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HRA 05/13/1993 - 6333HOUSING AND REDEVELOPMENT AUTHORITY MEETING THURSDAY, MAY 13, 1993 7:30 P.M. WILLIAM BURNS EXECUTIVE DIRECTOR OF HRA _ r CITY OF FRIDLEY AGENDA HOUSING & REDEVELOPMENT AUTHORITY MEETING THURSDAY, MAY 13, 1993, 7:30 P.M. Location: Council Chambers Fridley Municipal Center 6431 University Avenue N.E. CALL TO ORDER ROLL CALL APPROVAL OF MINUTES: April 8, 1993 ACTION ITEMS: CONSIDER SUBORDINATION AGREEMENT FOR SHEET METAL CONNECTORS . . . . . . . . . . . . . . . 1.1 -1.15 CONSIDER RESOLUTION TO AUTHORIZE PARTICIPATION INMHFA MINNESOTA CITY PARTICIPATION PROGRAM. . . . . . 2.1 -2.11 CONSIDER PROPOSAL FOR IMPROVEMENTS IN COOPERATION WITH MISSISSIPPI STREET IMPROVEMENT PROJECT . . . . . 3.1 -3.9 IDER'REVISED LEASEHOLD AGREEMENT FOR THE IDLEY PLAZA OFFICE BUILDING PARKING LOT . . . . . . . 4.1 -4.11 ONSIDER RESOLUTION DESIGNATING`OFFICIAL DEPOSITORIES 5.1 -5.2 IMS AND EXPENSES . . . . . . . . . . . . 6.1 -6.3 y INFORMATION ITEMS: STATUS OF HOUSING PROGRAM IMPLEMENTATION. . . . . . . . 7.1 -7.5 RICE PLAZA UPDATE . . . . . . . . . . . . . . . . . . . 8.1 FOLLOW -UP ON LAKE POINTE BID INFORMATION. . . . . . . . 9.1 FOLLOW -UP ON TAXES FOR HRA PROPERTY . . . . . . . . . .10.1 -10.4 MEMO ON HRA ANNUAL REPORT FOR SUMMER NEWSLETTER . . . .11.1 OTHER BUSINESS ADJOURNMENT CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL So 1993 CALL TO ORDER: Chairperson Commers called the April 8, 1993, Housing & Redevelopment Authority meeting to order at 7:30 p.m. ROLL CALL: Members Present: Larry Commers, Virginia Schnabel, John Meyer, Duane Prairie, Jim McFarland Members Absent: None Others Present: William Burns, City Manager Barbara Dacy, Community Development Director Rick Pribyl, Finance Director Craig Ellestad, Accountant Grant Fernelius, Housing Coordinator Appointee APPROVAL OF JANUARY 9 1993 JOINT CITY COUNCILIHRA MINUTES AND JANUARY 14, 1993 HOUSING & REDEVELOPMENT AUTHORITY MINUTES: MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the January 9, 1993, Joint City Council /HRA minutes and January 14, 1993, Housing & Redevelopment Authority minutes as written. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 1. CONSIDER APPOINTMENT FOR HOUSING COORDINATOR Ms. Dacy stated staff is recommending that the HRA appoint Mr. Fernelius as Housing Coordinator. Out of 77 candidates, five were interviewed and Mr. Fernelius was the top candidate. Mr. Fernelius stated he was honored to be considered a finalist. He looks forward to the opportunity to work with the HRA. MOTION by Mr. Prairie, seconded by Mr. Meyer, to accept the recommendation of staff to appoint Mr. Grant Fernelius as Housing Coordinator. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. Ms. Dacy stated a related item has come up which is a cooperative purchase agreement. Because the HRA has essentially hired an . HOUSING & REDEVELOPMENT AUTHORITY MEETING. APRIL So 1993 PAGE 2 employee, this document is a joint powers agreement between the HRA and Anoka County so this employee can be put on the group insurance coverage similar to what the City now does for its current employees. Staff recommends the HRA approve the joint powers agreement and authorize the Executive Director and the Chairperson to sign the agreement. Mr. Meyer asked if this was ongoing for things other than insurance. Is there not something already in force? Ms. Dacy stated there is an agreement in force with the City but not the HRA as a separate entity. MOTION by Ms. Schnabel, seconded by Mr. McFarland, to recommend approval and to authorize the Executive Director and Chairperson to sign the joint powers agreement. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 2. AWARD BID FOR MAINTENANCE OF LAKE POINTE SITE Ms. Dacy stated bids were received for the Lake Pointe Development Maintenance Project No. 244 and the low bidder was Jon Isaacson Lawn Care with a bid of $24,173.00. Mr. Commers asked if the company was bonded. Ms. Dacy stated, yes. They are bonded and must submit it to the Public Works Department. She believed the City had received this from the Jon Isaacson Lawn Care company. MOTION by Mr. Prairie, seconded by Mr. Meyer, to approve awarding the bid for the Lake Pointe Development Maintenance Project No. 244 to Jon Isaacson Lawn Care for $24, 173.00. Mr. Commers asked what was included in Alternates A and B. Ms. Dacy stated she was not sure and did not have the documents at this time. Mr. Prairie stated he would assume these were items that, if above budget, would not be done. Mr. Meyer asked if the deletion or acceptance of the alternates would change the low bidder. Ms. Dacy stated, no. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. a HOUSING & REDEVELOPMENT AUTHORITY MEETING. APRIL 8, 1993 PAGE 3 3. CONSIDER APPROVAL OF SATISFACTION OF MORTGAGE FOR 5831 - 3RD STREET N. E. Mr. Commers stated the HRA is asked to approve the satisfaction of the Peterson mortgage, and the HRA has one other home on this program. Staff is recommending the HRA give the Executive Director authority to satisfy that mortgage when it comes due. Ms. Schnabel stated the satisfaction has already been done, and it looks as if the Petersons have lived up to the terms' of the agreement. MOTION by Mr. Schnabel, seconded by Mr. Prairie, to endorse the mortgage satisfaction to Orlin and Darlene Peterson and to authorize the Executive Director to execute the remaining mortgage satisfaction when necessary as long as the program requirements are met. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 4. HRA BUDGETS FOR 1993 Ms. Dacy stated a copy of the 1993 budget was included in the agenda. Projects occurring in 1993 include: 1) the Mississippi Street reconstruction project; 2) Lake Pointe marketing; 3) housing programs; 4) University Avenue signal improvements; 5) Fridley Town Square and Dairy Queen issue; and 6) redevelopment of the southwest quadrant. Ms. Dacy referred to the Projection of Annual Accumulated Balance and stated staff has verified all revenue columns and expenditure columns. In 1995 and 1999, while there is a negative annual balance, the cumulative balance is positive. In 1995, the bond payment for Lake Pointe is due and in 1999 the'�final bond payment for another issue is due. Staff has estimated the revenue side very conservatively, assuming there is no new growth. For example, the tax increment from Wa1Mart is not included. Ms. Dacy stated that in terms of operating expenses, given the initial focus on housing programs, staff has separated the budget into two budgets for better tracking. The HRA is right on budget for the housing coordinator fund. In the operating budget, staff is projecting approximately a 20 increase in the overall operating expenses. Because there will be a number of one -time expenses in 1993, some expenses will drop off in 1994. Ms. Dacy stated that at a previous meetings, the HRA wanted staff to analyze legal services and how much is being spent. The amount �. >.z. wa. .7.` .R s • •il � tit_ ``;ti2•i2�,h`l::i:.tivai::i:iai• �tfii�i HOUSING & REDEVELOPMENT AUTHORITY MEETING. APRIL 8, 1993 PAGE 4 spent is on budget for both legal firms, Barna, Guzy, and Casserly. Ms. Dacy stated that the HRA also asked staff to look at Rice Plaza. In 1992, they had a positive balance. However, in 1993, they can expect a negative balance because of the current tenant mix. Later this year, she recommends revisiting that issue and determining whether or not to proceed with demolition of the building. All leases will expire by the end of this year. Mr. Commers stated the tax increment projection is based without WalMart and Springbrook and is based on the current growth. Is there any appreciation on taxes included? Mr. Pribyl stated these are the numbers received for pay 1992 and inserted any increases that we know of in the next year. There is no appreciation of property for future years. Revenues are actual based on the agreements in existence today. Ms. Commers asked if interest earnings were calculated at 50. Mr. Pribyl stated that was correct. That is 5% on the cumulative balance. Mr. Commers stated that the worksheet is good planning purposes, but the school district refunds should be footnoted that this is not an obligation. Mr. Pribyl stated this spread sheet is a planning device for the HRA and not a public document. Mr. Commers is correct in saying that at any point these can be discontinued. Mr. Commers stated that for planning purposes, this is good to include. Mr. Pribyl stated he would add a footnote. Mr. Burns stated this number has been considerably less when taking into account delinquencies. Mr. Pribyl stated, yes. It is dependant on the property. Mr. Commers asked if the 1992 refund was short. Mr. Pribyl stated they are actually still working on the last half of pay 1992. It is probably closer to the upper $200,000 figure. That amount includes Lake Pointe. Mr. Prairie asked if this is the one that was discussed by the Council. It might be good to put in the new numbers on the whole thing. HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL S. 1993 PAGE 5 Mr. Pribyl stated these are projections and these will be updated. Next year, he will have the newest projection for 1993. All they can do is use the last actual figures for future projections. Mr. Burns stated staff does not have that information. The best they can do is provide 1990 and 1991 actual. Mr. Pribyl stated for 1992 it is something less than $100,000 but still between $50,000 and $100,000 but he did not know exactly what that figure is. Mr. Burns stated staff can provide projected actuals for the next meeting. Ms. Schnabel asked if they wanted actual as well as projected. Mr. Prairie stated that if the projection is off by 30e, he did not want it at this time. Mr. Pribyl stated it is only at this part of the fiscal year that staff can provide this to the HRA. In June and July, staff will get the "pay for 1993" and will be processing that for the next agreement period. It is still a guess because they do not know what the abatements and other tax petitions will be. Mr. Prairie stated he thought the school districts need it in May. Mr. Pribyl stated he can only give the most current numbers that are available. Mr. Commers stated the next issue relates to the salaries for the City and referred to the document on how much is spent on HRA time. Mr. Burns stated the City estimates the time allocated for the HRA and charges that percentage of salaries to the HRA. Each person is asked approximately how much time is spent for the HRA and that is the amount of time they include. Mr. Pribyl stated they are still using the same percentages used in the last two budgets. Mr. Prairie stated this is the equivalent of three full -time staff. Mr. Burns stated this-seems correct. It was calculated before and he thought that is what they came up with. Mr. Prairie stated $168,000 is more than the previous year. Mr. Burns.stated this reflects 3% increase over last year. ------------ - ----------- faV{14T{16 aicia�wlHSSd{ittid6iV >:J�Ji1i HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 6 Ms. Schnabel asked if the Housing Coordinator position was included. Mr. Burns stated, no. Staff thought it best to keep track of that separately. Mr. Commers stated the legal fees seemed high. Ms. Dacy stated the budgeted amount is the same as last year and the year before. Ms. Dacy stated professional services includes more than attorney fees. Staff is recommending reserving $30,000 for Lake Pointe consultant services. In terms of attorney fees, Barna, Guzy are under budget and Casserly is within $2,000. Mr. Prairie stated fees were less last year. Ms. Dacy stated Casserly had a lot of time involved with Lake Pointe. Mr. Commers asked if staff anticipates any major projects at this time. Ms. Dacy stated the projects are included in the capital improvements section. Mr. Commers stated none of that takes legal services. Ms. Dacy stated this is correct. Mr. Prairie stated there is another $30,000 for Lake Pointe for a total of $60,000. Ms. Dacy stated $30,000 is for the consultant fee and $30,000 for advertising. Mr. Burns stated this is a best guess at this point. Mr. Commers stated it was his understanding that the City would do the rental inspections. Mr. Burns stated the budget includes rehab inspections. Ms. Dacy stated these are single family rehab programs which are separate from the rental unit inspections. Mr. Burns stated that when they start talking about the screening process, inspections will be discussed more. HOUSING & REDEVELOPMENT AUTHORITY MEETING. APRIL So 1993 PAGE 7 Ms. Schnabel asked if the inspector is someone who will be hired to inspect for the HRA. Ms: -_Dacy stated these will be contracted services. Mr. Fernelius will be responsible for evaluating to see that they are qualified, and inspectors will be assigned to applicants who are receiving monies. He will have a pool of inspectors and will have contracts based on an hourly rate. Mr. Commers asked if it is necessary to have certification so, as government agencies approve property and they say it meets requirements, it is accepted. Ms. Dacy stated if property is inspected for MHFA the property may have different requirements. Staff is setting up minimum requirements for these inspectors. Staff has contacted communities with truth in sales ordinances and has a list of inspectors who work in these cities. Staff will contact these people to see if they are interested in providing service here. Mr. Commers referred to Rice Plaza. It seemed that for the condition of that Plaza and the income generated, the taxes should be abated. Ms. Dacy stated that as long as this is an income generating property, taxes will have to be paid. Mr. Commers stated he believed the taxes should be reduced significantly. What is the fair market value from the appraiser? Ms. Dacy stated taxes went up from 1992 because of class rate changes. She did not think the value was raised but there was a different method of calculating. Mr. Burns stated he also thought the taxes should have come down. Ms. Dacy stated that sometime in the future the HRA needs to decide whether to continue or get out. Mr. Commers stated the building does not have a great deal of value. The only value is the land value. As a result, it would seem that they could ask the County to significantly reduce the taxes. Mr. Pribyl stated they can file a request when paying the first half taxes. He can check and provide a report from the assessor. Mr. Prairie asked when the HRA needs to discuss what to do. It is not fair to the renters to wait until the last 60 to 90 days. Ms. Commers stated they should also look at what it will cost to demolish the building. ��, axxratsan�ursas<sexxxxxsrsta� HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL S. 1993 PAGE 8 Ms. Dacy stated that about one year ago, an estimate for demolition was about $25,000. Staff is planning to schedule this discussion during June or July. Mr. Commers stated they don't have what all of the debt services are. Mr. Pribyl stated they have three different bond issues that are still outstanding. There is no other long term debt. Mr. Commers stated that based on the analysis, if they assume these numbers are accurate, what is available for development between now until the year 2000.. Mr. Pribyl stated that if the HRA does nothing now until the year 2000, they would have accumulated a balance of $4.4 million. If funds are used, the cumulative balance would be less because less interest would be earned. Mr. Commers asked, out of this amount, what is the accumulated interest? Mr. Pribyl stated there is a significant amount of interest, perhaps $2.5 million to $3 million. Mr. Commers stated that if they use funds, they have only $1 million. What happens on Lake Pointe if they want to put $4 million into it? Mr. Pribyl stated they have a cumulative balance that will carry the 1995 debt service payment. There is a huge incentive at Lake Pointe which is the land value. Mr. Burns stated the incentives are the land writedown and the parking ramp. They need intensive development to warrant a parking ramp. Mr. Commers stated there is no balance sheet to show the HRA what they have. Mr. Pribyl stated he is working on it now. He does not have it for 1992. What the Commission is seeing in the cumulative balance is what the balance actually is. This is the cash position but not the property that is owned. Mr. Commers stated this is not as good as it should be. Mr. Pribyl stated that with the situations at Lake Pointe and the City Center, they have still kept cumulative balance. HOUSING & REDEVELOPMENT AUTHORITY MEETING. APRIL S. 1993 PAGE 9 Mr. Commers stated that the HRA will have to be much more careful and be sure projects will break even. Mr. Pribyl stated that with Lake Pointe, he thought the land incentive is attractive if they get a developer that can handle that size of property. Mr. Commers stated that assuming that takes place, that is a balance sheet item and will have no effect on the budget. Mr. Burns stated that in terms of economic development items, it is going to orient them to a pay -as- you -go approach for economic development projects that arise. Mr. Commers asked how pay -as- you -go affects this. Mr. Pribyl stated it does in that they have income on the tax increment side and expenses going out. Mr. Burns stated you cannot pay out more than what you are getting. If the increment is not there, you don't pay. At a minimum, they get the 10% administrative fee up front. Mr. Pribyl stated ordinarily it would positively impact that statement. Mr. Commers asked what made up the rental income. Ms. Dacy stated they received rental revenue from Fridley Liquor Warehouse, Fridley Plaza Office parking lot, Dairy Queen, the oil changing facility, and Rice Plaza. The worksheet assumes no income from Rice Plaza in 1994; and, as of 1997, the southwest quadrant would be redeveloped. The Fridley Office Plaza parking lot rent is for 30 years. Mr. Commers asked, other than Rice Plaza properties, are there any other associated maintenance expenses? Ms. Dacy stated there Office building, but charges to the HRA on said they would like coating and striping. showing wear. Rental that lot. is parking rent exceed; that in the to talk "to The project income will lot maintenance for the Plaza S costs. There are no direct last year or two. Owners have us about a schedule for seal is about eight years old and is cover maintenance expenses for Ms. Dacy stated that because of the housing issues, staff could not do the budget earlier but will try to go through this discussion for 1994 in November or December. For clarification of the utility services #4338, Lake Pointe has an irrigation system and she received a late bill from the utility department for 1992. y9L' R? dSH' SS.` ilitiitf: 57i: iti2tii; ti2i::. KT] HH� f:4K:itiii:i`S2fM�2.k:j:hR2i$ ill.' kisissi�3di22f�; Yti72i+g 8uiS3i21�. 7i. T: �: hR3tf# 3E3t3Zw��h: �Lfki�:: w.: i; isisiYitS2l iSt' r9: i. KtfESEH3L4ti2i2ttYlHf.° 7l RHtit52v` SiSdiC415tH�ifna .�..�+r+ru.:.a:. >.: a.:.:v: HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 10 Budgeted was $3,000 and she would like the HRA to allocate an additional $3,400 to cover the existing expenses for the water bill. The total should be $6,400. Mr. Commers asked if trees would be replaced in the plaza. Ms. Dacy stated that nothing has been done with the tree replacement project for two years. Two years ago, several locust trees were removed and budgeted for replacement but staff did not move on it. This is to bring it to the Commission's attention and the HRA can eliminate it or direct staff to do the project. Mr. Commers asked what is done on litigation settlements. There is another potential $40,000 for the Dairy Queen. Ms. Dacy stated that number represents that Fitch to date has been awarded $125,000 and this reflects the remaining funds. MOTION by Mr. McFarland, seconded by Mr. Prairie, to approve the budget as presented with the amendment to #4338 for a total of $6,400 for utility services (water). UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 5. CLAIMS AND EXPENSES Mr. Pribyl stated there are some additions to the check register. Mr. Ellestad stated it is difficult to present a complete register because of when the meetings are scheduled so he will present additions. These are #2307 to Steve and Paul Barnacle for February and March snow plowing in the amount of $230.00. There are two checks #2305 which will be combined and go out in one check. The next is to First Choice for $446.98 for a modem for Mr. Casserly. Mr. Commers stated he thought that should be his expense. It should be his responsibility to provide for the needs of his clients. Mr. Burns stated they tried to work with his equipment and his equipment did not work. He thought this would reduce legal fees. Mr. Ellestad stated the next is to American Express for $94.00 for lunches to discuss Lake Pointe; Casserly Law offices for $2,273.50 March legal services, and Kordiak Company for $135.99 for the March management fee. MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the claims and expenses as amended. HOUSING A REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 11 UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED. 6. ADDITIONAL FINANCING FOR FRIDLEY TOWN SQUARE Mr. Commers asked if Mr. Burns had any meetings with Mr. Wagner. Mr. Burns stated he has not met with Mr. Wagner personally. Mr. Casserly has met with them. He talked with Lowell Wagner over the phone and reiterated his position. Mr. Fitch has asked for a $35,000 additional settlement on the Dairy Queen. Staff believes the HRA should stay with the original proposal. This is to update the Commissioners unless the HRA decides otherwise. Mr. Meyer asked if the option was to face the possibility of taking legal action. Mr. Burns stated Mr. Fitch has filed an appeal and it could be that he will follow it through the court system. It could cost additional money. Mr. Commers stated three independent appraisers have made an assessment of value. When these people testify that this is the value, it will be very hard to overcome that. Usually the court will put the greatest weight on what these people say. He has moving benefits also and an allowance for fixtures. 7. REVIEW SCREENING PROCESS FOR REHAB LOAN APPLICATIONS Ms. Dacy stated what staff heard at the joint meeting was that the HRA wants to pursue a pre- screening method. She talked to the Minneapolis Community Development Association (MCDA), City of St. Paul and some of the bankers to see what they want in terms of an application. Staff talked to Mr. Gene Malis who has helped set up some rehab programs. Ms. Dacy stated she has tried to set up an application review schedule with a rating schedule to score applicants. The potential time frames are to start advertising in May, 1993, and establish the application window to send out application and receive them back allowing approximately 30 -45 days. They would close applications, then have two weeks where the Housing Coordinator would look-at the applications and sort by income for CDBG, MHFA, etc. Using a rating system, the Housing Coordinator would go through and score the applications that could be funded. If they get a flood of applications, they may have to tell some applicants that the HRA cannot fund their application. If that happens, once the first set of applications gets up and running, they could open another window in August. Potentially, depending on the response and funding, they could possibly have four opportunities for HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL So 1993 PAGE 12 residents to apply for these programs. She thought the City would get a lot of response and thought funds would go fast. Ms. Dacy stated that in terms of the rating system, they started with a list of 15 criteria and then set priorities according to the HRA and Council recommendations. The rating will be according to age of home, income, a priority list of homes, and the value of code - related work. When the Council reviewed this, they liked the system, but asked the HRA to use how long an owner has lived in the community as a tiebreaker if necessary. Ms. Dacy stated staff also developed a potential application form. The first page is basic information about who the owner is and the type of dwelling. No application will be approved if there is illegal activity at the home. At the bottom is a list of code - related work which will help in reviewing applications. The last page is to get preliminary information as to the range of debt and range of income. They are asking for a copy of 1040 or 1040A to verify income. After the grant goes through and they determine who will be receiving money, the next step is to call a rehab inspector to look at the building, see if the work to be done is okay and if there is any other work that needs to be done. The inspector will review the results with the Housing Coordinator and implement the program from there. Ms. Schnabel asked if the questions on the application are in keeping with questions that are needed for the CDBG or the other programs that are potential funding for these projects. Ms. Dacy stated the financial information is more for the loan programs. The banks and administrative programs will need this information up front before creating loans. This is probably asking for more than is needed for CDBG, but staff is trying to create one all purpose form. Ms. Schnabel asked if marital status is necessary information. Ms. Dacy stated it is necessary for refinancing debt. They want to see if there are agreements for child support or other issues like alimony. Mr. Meyer asked what procedure will be ''used to advertise the program and the dates. Ms. Dacy stated that, first, a direct mail approach will be used to contact people on the priority list. Staff will develop a brochure and let them know these programs are available-. Second, an ad in the Focus or an article on the programs will be printed. Staff has budgeted for the program up to eight 1/4 page ads. Further, she wants to crosstrain all inspectors to be aware that these programs are available and ask people to call. HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 11 UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COM ORO DECLARED THE MOTION CARRIED. 6. ADDITIONAL FINANCING FOR FRIDLEY TOWN SQUARE Mr. Commers asked if Mr. Burns had any meetings with Mr. Wagner. Mr. Burns stated he has not met with Mr. Wagner personally. Mr. Casserly has met with them. He talked with Lowell Wagner over the phone and reiterated his position. Mr. Fitch has asked for a $35,000 additional settlement on the Dairy Queen. Staff believes the HRA should stay with the original proposal. This is to update the Commissioners unless the HRA decides otherwise. Mr. Meyer asked if the option was to face the possibility of taking legal action. Mr. Burns stated Mr. Fitch has filed an appeal and it could be that he will follow it through the court system. It could cost additional money. Mr. Commers stated three independent appraisers have made an assessment of value. When these people testify that this is the value, it will be very hard to overcome that. Usually the court will put the greatest weight on what these people say. He has moving benefits also and an allowance for fixtures. 7. REVIEW SCREENING PROCESS FOR REHAB LOAN APPLICATIONS Ms. Dacy stated what staff heard at the joint meeting was that the HRA wants to pursue a pre- screening method. She talked to the Minneapolis Community Development Association (MCDA), City of St. Paul and some of the bankers to see what they want in terms of an application. Staff talked to Mr. Gene Malis who has helped set up some rehab programs. Ms. Dacy stated she has tried to set up an application review schedule with a rating schedule to score applicants. The potential time frames are to start advertising in May, 1993, and establish the application window to send out application and receive them back allowing approximately 30 -45 days. They would close applications, then have two weeks where the Housing Coordinator would look at the applications and sort by income for CDBG, MHFA, etc. Using a rating system, the Housing Coordinator would go through and score the applications that could be funded. If they get a flood of applications, they may have to tell some applicants that the-HRA cannot fund their application. If that happens, once the first set of applications gets up and running, they could open another window in August. Potentially, depending on the response and funding, they could possibly have four opportunities for HOUSING & REDEVELOPMENT AUTHORITY MEETING. APRIL S. 1993 PAGE 12 residents to apply for these programs. She thought the City would get a lot of response and thought funds would go fast. Ms. Dacy stated that in terms of the rating system, they started with a list of 15 criteria and then set priorities according to the HRA and Council recommendations. The rating will be according to age of home, income, a priority list of homes, and the value of code - related work. When the Council reviewed this, they liked the system, but asked the HRA to use how long an owner has lived in the community as a tiebreaker if necessary. Ms. Dacy stated staff also developed a potential application form. The first page is basic information about who the owner is and the type of dwelling. No application will be approved if there is illegal activity at the home. At the bottom is a list of code - related work which will help in reviewing applications. The last page is to get preliminary information as to the range of debt and range of income. They are asking for a copy of 1040 or 1040A to verify income. After the grant goes through and they determine who will be receiving money, the next step is to call a rehab inspector to look at the building, see if the work to be done is okay and if there is any other work that needs to be done. The inspector will review the results with the Housing Coordinator and implement the program from there. Ms. Schnabel asked if the questions on the application are in keeping with questions that are needed for the CDBG or the other programs that are potential funding for these projects. Ms. Dacy stated the financial information is more for the loan programs. The banks and administrative programs will need this information up front before creating loans. This is probably asking for more than is needed for CDBG, but staff is trying to create one all purpose form. Ms. Schnabel asked if marital status is necessary information. Ms. Dacy stated it is necessary for refinancing debt. They want to see if there are agreements for child support or other issues like alimony. Mr. Meyer asked what procedure will be used to advertise the program and the dates. Ms. Dacy stated that, first, a direct mail approach will be used to contact people on the priority list. Staff will develop a brochure and let them know these programs are available. Second, an ad in the Focus or an article on the programs will be printed. Staff has budgeted for the program up to eight 1/4 page ads. Further, she wants to crosstrain all inspectors to be aware that these programs are available and ask people to call. V HOUSING & REDEVELOPMENT AUTHORITY MEETING. APRIL 8, 1993 PAGE 13 Mr. Meyer asked when the City Newsletter comes out. Ms. Dacy stated the newsletter comes out four times per year. This probably will not give them the best timing, but she can put in some information about the programs. Last year the HRA used the newsletter for their annual report. She has received about 15 calls from the article in the winter edition. Mr. Meyer stated he thought this sounded very good. The tie breaker seems somewhat academic, but an applicant can be picked up the next time a program is offered. Ms. Dacy stated this could depend on the number of applicants. There may be just one window depending on the number of applications. Mr. Meyer stated a person may be waiting regardless. If the Council feels the applicants should not be on a first -come, first - serve basis, then they can use length of residence. Mr. Commers stated he had no preference. Do whatever is fair. Ms. Schnabel stated she had a problem with page 7.7. She did not know how widespread this information goes but she thought the information should be confidential. Ms. Schnabel asked that on the priority list, did staff think anyone might be offended if they are on a list like this? Ms. Dacy stated that while she cannot control their reaction, the sites are in need of work. Perhaps the program is better served if they identify specific addresses. The Council and HRA wanted to revisit the programs every six months. She was concerned that many people would end up being missed and not have property included that the City wanted included. Mr. Commers stated they need to get started. If something comes up, it can be discussed and adjustments made as necessary. 8. DESCRIBE FUTURE MARKETING ACTIVITIES FOR LAKE POINTE AND SOUTHWEST QUADRANT Mr. Burns stated he is recommending a meeting with the HRA and City Council on May 8th. In January, Mr. Commers, the Mayor, Mr. Casserly, Ms. Dacy, and he talked about marketing Lake Pointe. Staff talked to Jim Winkels to identify a list of realtors to market the site and then interviewed them. He believed they all agree that this is an attractive site but at the same time they think the original vision will be difficult to accomplish. There is no market for office space and a worse market for hotel/ HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 14 conference center space. A more real focus would be high tech office building for manufacturing and office space. The other thing is that they are probably going to focus on the metro area because of the tax climate and adverse business factors. Mr. Burns stated the group talked about the name but the majority thought it should be called the Lake Pointe Business Center. Mr. Burns stated another suggestion was that they not spend as much on marketing but spend money for a monument at the site entrance. A market brochure needs to be prepared that can be sent to prospective clients. A number of decisions need to be made about uses and timing for those uses. The tax increment district expires in the year 2009. Do they want to try to attract uses in two to three years or wait five to ten years? Uses and timing are two very important things. They also need to focus on how to market. He is leaning toward a broker approach because of the limitations of staff. When talking about a real estate broker approach, some provide only a broker service. Others are also developers and builders. They can also use a developer approach. It is too early to rule that out. Perhaps the market is not right for anything and they may want to consider not doing anything for several years. Mr. Burns stated he is recommending hiring Bill Tobin to organize a strategic planning session and to meet with the HRA and Council on May 8 for a fee of $2,000. Mr. Tobin was brought to his attention by Mr. Winkels. Mr. Tobin has worked with Medtronic. He is interested in being a consultant. He thought Mr. Tobin would serve the City well, and he would be very helpful in wording and designing an RFP and helping to evaluate responses. He stated he would like to move ahead as quickly as possible. Mr. Commers asked if Mr. Tobin would do the meeting, planning, and report for $2,000 and after that he would be on an hourly basis. Mr. Burns stated, yes. He is willing to go on a fee per project if the City needs that. Mr. Meyer stated it would be nice to get together on May 8 but it seems the things to be discussed and things the HRA is being asked for decisions on are things he does not know much about. He thought these are things that Mr. Tobin should tell us. The HRA needs someone who will tell the HRA what they will be faced with or what approach to use in marketing. Mr. Burns stated it is important to know that the City Council and HRA are buying into a particular set of guidelines. A quality development on this site is a priority. Mr. Tobin is in a good position to steer them in the right direction for the uses the HRA might identify and to help bring them to a consensus. M s HOUSING S REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE is Mr. Prairie stated that if they want to develop at the level they want, they may have to wait seven or eight years. Mr. Meyer stated he wants the expert.'s guidance as opposed to guiding the expert. Mr. Commers asked if he wanted alternatives. Mr. Meyer stated he wants to be told the facts of what is out there and what is realistic. He wants to hear his expertise. Mr. Burns stated he has not yet structured the meeting. He can structure it so the HRA can hear the types of things Mr. Tobin feels they can do now and do two or three years out. Mr. Meyer stated to inform us of what is out there is important. Mr. Prairie asked if Mr. Tobin could present what would happen if the HRA waited two years or five years and the consequences. Ms. Schnabel asked if there are people in the corporate development center. Mr. Burns stated the biggest tenant is a company called Multi -Tech. Ms. Schnabel asked if it would be of some value to get someone who is involved in that development to talk to the HRA to find out how they proceeded, or has Mr. Burns talked to them? Mr. Burns stated he has talked to them. Ms. Schnabel asked if they want someone geared to a suburban area as opposed to downtown. Mr. Burns stated that if they start focusing on a person who has developed a particular parcel or who is currently developing, they will hear a sales pitch as opposed to a person who is objective about it. That is the kind of person I have tried to bring to you. This individual has demonstrated strong knowledge of real estate. Mr. Commers stated he thought this was a good start. They may raise even more questions and may need to do something else. It would be a good idea if he did have some things in mind as to what would be viable choices. Ms. Schnabel asked what about the southwest quadrant. Mr. Burns stated they have not talked about this. In conversations with one broker, he recommended the City try to attract a medical project such as a clinic. He thought Lake Pointe took priority. HOUSING &REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 16 Mr. Meyer asked if the meeting needed to be three hours. He would prefer 9 a.m. to it a.m. or 9 a.m. to 12 "noon. Then everyone has the afternoon free. Mr. Burns stated he can make it earlier. He would recommend that this be considered an HRA meeting rather than a Council meeting. He will tentatively assume the meeting is May 8 from 9 a.m. to 12 noon. Ms. Dacy stated she is requesting the Commission concur with the recommendation that, if necessary, the local match would come out of reserves that have been identified. She will find out more at a later point in time. The Commission concurred. 10. RICE PLAZA UPDATE Mr. Commers stated they had talked about and have the March rental information. This is for the Commission's information. 11. MISSISSIPPI STREET IMPROVEMENT PROJECT Ms. Dacy stated that as part of the_ Mississippi Street improvement, she has requested the contractor park their trailer behind Rice Plaza and access by 3rd Street. Ms. Dacy is requesting the HRA pass a motion for the County to make a minor modification to save a 100- year -old oak tree next to the Target property on Mississippi Street. This is a double trunk tree and she is asking the public works department to route the sidewalk around the tree rather than remove it. Siah St. Clair has looked at the tree and stated this is a white oak which is very hardy. There will be a two -foot grade cut and with the sidewalk rerouted, he is confident the tree will survive. These trees have a life expectancy of 300 -500 years. Mr. Commers asked why not do the sidewalk on the side away from the curb. Ms. Dacy stated they could do it that way also. There is another oak tree in the median and the sidewalk would have to be routed in between the two trees. Mr. Prairie asked if there were any safety concerns. Ms. Dacy stated it is better to have the sidewalk separated from the curb but there are instances where sidewalks butt up against the curb. HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 17 Mr. Commers asked if there would be extra cost. Ms. Dacy stated she thought it would even out. They would have to build a two foot retaining wall which would even out with the cost of brick. OTION by Mr. McFarland, seconded by Ms. Schnabel, to recommend rerouting the sidewalk to save the white oak tree. UPON A VOICE VOTE,, ALL VOTING AYE,, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 12. OTHER BUSINESS Mr. Burns stated there are signs the industrial sector of the economy is improving. He has been getting contacts at the City. This is on behalf of the All -Temp Corporation located on Ninth Street just north of Kurt Manufacturing. They sent a letter describing a 50,000 square foot addition they would like to build on to their building, but they have some problems building it in Fridley as far as sprinkler systems in refrigerated space. They also have to provide for storm water detention and that is difficult with the lack of storm drains on Main Street. They will still have to provide for storm detention, but next year the County is planning to install a storm drain line so that will help. They do have a customer in Monticello that needs the frozen storage, and this customer and the City of Monticello is offering financial incentives to build a facility there. They are asking how they can solve these problems and asking what financial incentives Fridley may have. Mr. Burns stated Mr. Holman represents two companies - All -Temp Distribution and All -Data Storage. The two companies employ 53 people. They occupy 425,000 square feet next to Kurt Manufacturing. One -third of the building is leased to American Converters and Land O'Lakes. All -Temp provides food distribution services for a number of frozen food producers. All -Temp has annual sales of $3.5 million and All -Data, a records storage business, has $1.0 million in sales. The project is a 50,000 square foot facility to be built.: - - -to serve two prospective customers. Estimated cost is $3.0 million with an expected tax value of $20 per square foot. They plan to hire 15 to 20 new employees with an average salary of $28,000. They hope to begin construction in 1993. There is the potential of another client requiring 10,000 to 15,000 square feet and, if that happens, they will have to go somewhere else. They also need a rail site. Mr. Burns stated he has asked Mr. Casserly to review the project. The project can legally be funded through TIF and an Economic Development Tax Increment District could be created. If they HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 18 accept $3 million as the project costs and apply the 5% guideline, they could provide up to $150,000 as a grant incentive or a pay - as- you -go incentive. Alternatively, Mr. Casserly suggests considering a combination loan and revenue note package. Mr. Burns stated there are issues other than space. The site is tight and Kurt uses the property for parking. If All -Temp is to build, Kurt would not have use of the property and Kurt is at maximum lot coverage. There are some density problems for Kurt. They are looking at a site across from Holiday Plus. Mr. Prairie asked why not go ahead with it. Mr. Burns stated he did not see anything wrong. He recommended going ahead, but he did not want to go with a grant. He has not given an opportunity to Mr. Casserly to present his idea. Mr. Commers stated he agreed with the concept to go ahead and see where it goes. Mr. Burns stated this is a distribution business rather than a manufacturing business but it is a worthwhile enterprise and it is worthwhile to support an existing industry. Mr. Commers stated to go forward and see what can be done. Mr. Meyer asked that regarding the sprinkler system, is it the City that must approve? Mr. Burns stated it is the State Building Code which the City interprets as requiring a sprinkler system. Mr. Burns stated the building is very cold and it is very expensive to install a sprinkler system. Ms. Dacy stated they can get an opinion. ADJOURNMENT MOTION by Ms. Schnabel, seconded by Mr. McFarland, to adjourn the meeting. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED AND THE APRIL 8, 1993, HOUSING & REDEVELOPMENT AUTHORITY MEETING ADJOURNED AT 10:10 P.M. Res ectfully submitted, K-4701� Lavonn Cooper Recording Secret V 1:1 C% Community Development Department D HousnvG axn REnEVErormErrr AuTaoRrry City of Fridley DATE: TO: William Burns, Executive Director of HRA 440, FROM: Barbara Dacy, Community Development Director SUBJECT: Consideration of Subordination Agreements for Sheet Metal Connectors Sheet Metal Connectors is about to complete the SBA loan process for permanent financing of its new building on Main Street. The financing structure for a SBA loan includes a bank loan secured for at least 50% of the total project costs, the SBA loan constitutes 40% of the project costs, and the owner's equity constitutes the remaining lot of the project costs. The HRA's assistance took the_form of a $200,000 loan and was subordinated to the construction financing-placed by Northeast State Bank. At this time, the permanent financing must be obtained in order to take out the construction financing; therefore, the HRA's assistance must take a third position to the bank loan and the SBA loan. Michael Hurley, attorney for Northeast State Bank, has submitted a synopsis of the project loans and loan amounts. He has also prepared two subordination agreements for consideration and execution by the HRA. The HRA mortgage will be subordinated to the Northeast State Bank loan and the SBA loan from the Coon Rapids Development Company. We have asked Jim Casserly to review the documents, and he has advised us that they are in proper form and in compliance with the Development Agreement. Further, the $200,000 loan was secured by a personal guarantee from Jerome Myers. This proposal is similar to the HRA's assistance in the Advance Company's project on Central Avenue. In that case, Mr. Ritterman also obtained SBA financing. Recommendation Staff recommends that the HRA approve the attached subordination agreements and authorize execution by the HRA Chairperson and the Executive Director. BD:ls M -93 -253 M INC... #821 P02 .--. -- MAY- 06 -'93 THU 10:57 ID:BDS INC. TEL h10: 7� -9034 1.2 rm The following is a listing of the uses and sources of funds for the building construction project in Fridley: Land Building Construction Contingencies /Soft Costs SUBTOTAL Plus: SBA Debenture Pricing TOTAL USES OF FUNDS WW Bank SBA (Including Debenture Pricing) City of Fridley - I-IRA Owners' Equity TOTAL SOURCES OF FUNDS $ MOM 2,139,112 100,000 $2,414,112 $ 786,112 750,000 200,000 ° ROBERT A. GUZY BERNARD E. STEFFEN RICHARD A. MERRILL ROBERT C. HYNES, :RICHARD A. BEENS DARRELL A. JENSEN JEFFREY S. JOHNSON RUSSELL H. CROWDER ]ON P. ERICKSON LAWRENCE R. JOHNSON DAVID A. COSSI THOMAS P. MALONE MICHAEL E HURLEY May 4, 1993 Df"IS 13ki Barna, Guzy & Steffen, Ltd. ATTORNEYS AT LAW 400 Northtown Financial Plaza 200 Coon Rapids Boulevard Minneapolis, MN 55433 (612) 780 -8500 FAX (612) 780 -1777 Ms. Barb Dacy Fridley HRA 6431 University Ave Ne Fridley, MN 55432 1.3 SHARON L HALL VIRGIL C. HERRICK HERMAN L. TALLE PAMELA M. HARRIS CHARLES M.SEYKORA WILLIAM M. HANSEN DANIEL D. GANTER, JR. BEVERLY K. DODGE GREGG V. HERRICK JAMES D. HOEFT JOAN M. QUADE SCOTT M. LEPAK STEVEN L MACKEY RE: Sheet Metal Connectors / Jerome Myers / MSCJ, Inc. Dear Ms. Dacy: I have been requested by Mr. Jerome Myers sole shareholder of Sheet Metal Connectors ( "Sheet Metal ") and MSCJ, Inc. ( "MSCJ") tc outline the steps he is taking,to refinance the existing debt against the facility his company has constructed at 5850 Main Street NE, Fridley, MN ( "Project "). I represent Northeast State Bank, the construction and takeout lender on this project. Northeast State Bank lent Sheet Metal 1.4 million dollars in August of 1992 by and through a line of credit for the purpose of constructing a building on the Project. The HRA gave a $200,000 loan to MSCJ for the purpose of land acquisition and construction of the Project. To secure payment of the $200,000 note, the HRA took a mortgage against the Project and a personal guaranty of Mr.:Myers. Currently, the Project has a first mortgage against it in the original amount of 1.4 million dollars in favor of Northeast State Bank and a second mortgage against it in the amount of $200,000 in favor of the Fridley HRA. The outstanding principal balance on the line of credit secured by the first mortgage in favor of Northeast State Bank is $728,000.00. Sheet Metal and MSCJ are in the process of obtaining permanent financing for the Project. Sheet Metal has applied for a $750,000 loan from the Small Business Administration ( "SBA") under a SBA 504 loan program. Northeast State Bank has agreed to provide financing for the Project in the amount of $872,000. Northeast State Bank and the SBA have requested that the $200,000 second mortgage from the Fridley HRA be subordinated to the new debt. The SBA will close on this transaction, issue debentures and fund the note in July of 1993. At closing, Northeast State Bank will leave the existing first mortgage in place. A second An Equal Opportunity Employer 1.4 May 4, 1993 Page 2 mortgage will be placed on record in favor of Northeast State Bank in the amount of $872,000. A third mortgage in favor of the -SBA will be placed of record in the amount of $750,000. As I indicated above, the current outstanding principal balance of the first mortgage in favor of Northeast State Bank is $728,000. Northeast State Bank has agreed not to extend any further credit under the first mortgage and agrees that the $728,000 will remain in place until the SBA debentures are sold and the note funded. The SBA will use the $750,000 from the sale of the debenture to pay in full the first mortgage held by Northeast State Bank. At that time, Northeast. State Bank will satisfy their first mortgage. After satisfaction of.the first mortgage, the Project will be encumbered by a first mortgage in favor of Northeast State Bank in the amount of $872,000, a second mortgage in favor of the SBA in the amount of $750,000 and a third mortgage in favor of the Fridley HRA in the amount of $200,000. In order to accomplish the above referenced transaction, Sheet Metal, MSCJ and Mr. Myers are requesting that the Fridley HRA subordinate its $200,000 mortgage to the first mortgage now held by Northeast State in the amount of 1.4 million, the second mortgage to be placed of record in favor of Northeast State Bank in the amount of $872,000 and a third mortgage to be placed of record in favor of the SBA in the amount of $750,000. Again, after the SBA debenture is sold and the note funded, the proceeds will be used to pay off the existing first mortgage in favor of Northeast State Bank with a current outstanding principal balance of approximately $728,000. At that time, the first mortgage will be satisfied and the Fridley HRA mortgage will be in a third position. I enclose copies of proposed Subordination Agreements. Please review this information and let me know if you require any further information for presentation to the HRA. Thank you for your time.and attention. "1y, ey MFH:set Enclosure cc: Mr. Jerome Mr. Robert Mr. Robert Myers, Sheet Metal Connectors Schwartz, Attorney at Law Jensen, Northeast State Bank Ab y SUBORDINATION AGREEMENT 1.5 THIS AGREEMENT, entered into on May , 1993, by and between Northeast State Bank of Minneapolis, a Minnesota corporation ( "Bank "); the Housing and Redevelopment Authority in and for the City of Fridley, a public body corporate and politic organized under the laws of the State of Minnesota ("HRA "); and Sheet Metal Connectors, Inc., a Minnesota corporation and MSCJ, Inc., a Minnesota corporation ( "Co- Borrowers"). WHEREAS, MSCJ, Inc., a Minnesota corporation ( "Owner ") is the fee owner of that certain real property in Anoka County, Minnesota, legally described on the attached Exhibit A ( "Property ") ; WHEREAS, HRA is the owner and holder of a mortgage currently encumbering the Property, which mortgage is dated September 1, 1992, and was filed for record on March 4, 1993 as Anoka County Recorder Document No. 1025984 ("HRA Mortgage "); and WHEREAS, Bank has agreed to loan Eight Hundred Seventy -two Thousand and 00 /100ths Dollars ($872,000.00) to Co- Borrowers, which loan shall be evidenced by a note ( "Bank Note ") and secured by a mortgage dated May , 1993, on the Property ( "Bank Mortgage "); WHEREAS, Bank has expressly conditioned its duty to advance the funds to Co- Borrowers upon the Bank Mortgage and Bank Note being prior and superior to the HRA Mortgage; and WHEREAS, HRA has agreed to subordinate the HRA Mortgage to the Bank Mortgage and Bank Note in order to facilitate the receipt of the loan by Co- Borrowers. NOW, THEREFORE, in consideration of One Dollar and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged and of the covenants, promises, and conditions contained herein, the parties agree as follows: SECTION 1. SUBORDINATION HRA hereby covenants and agrees that the HRA Mortgage shall be considered, and in all respects shall be, subordinate to the Bank Mortgage and Bank Note and any extensions or renewals of the Bank Mortgage or the Bank Note; provided, however, that the amount of this subordination shall not exceed the original amount of $872,000.00 with interest thereon as provided in the Note, together with all other costs or expenses advanced pursuant to the terms of the Bank Mortgage or Bank Note and the statutory fees allowed upon the foreclosure of the Bank Mortgage. SECTION 2. FURTHER ASSURANCES HRA covenants and agrees that if reasonably deemed necessary by a title company or an attorney for a title company to properly document the subordination by HRA contained in this Agreement, then HRA shall duly execute and deliver to Bank and such title company any instrument, document, conveyance, release or waiver which will more fully and adequately subordinate the right, title, estate, lien and 1.6 interest of HRA to the right, title, estate, lien or interest of Bank. SECTION 3. MISCELLANEOUS A. All rights and obligations arising out of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties hereto. B. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Minnesota. C. This Agreement shall remain in full force and effect until 30 days after all amounts due Bank pursuant to the Bank Mortgage and Bank Note have been fully paid and satisfied, and thereafter it shall terminate. After said termination, the parties shall execute such documents or instruments as may be necessary or required to remove any cloud on title caused by this Agreement. D. This Agreement or a memorandum thereof may be recorded in the appropriate offices in Anoka County, Minnesota to protect and give notice of the respective rights of Bank and HRA hereunder. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed the year and day above first written. Northeast State Bank of Minneapolis, a Minnesota corporation By: Its: Housing and Redevelopment Authority in and for the City of Fridley, a public body corporate and politic organized under the laws of the State of Minnesota By: Its: Sheet Metal Connectors, Inc., a Minnesota corporation By: Its: -2- u 1 ■7 MSCJ, Inc., a Minnesota corporation By: Its: STATE OF MINNESOTA) ) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this of May, 1993, by , the of Northeast State Bank of Minneapolis, a Minnesota corporation, on behalf of the corporation. Notary Public STATE OF MINNESOTA) ) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this day of May, 1993, by , the of the Housing and Redevelopment Authority in and for the City of Fridley, a public body corporate and politic under the laws of the State of Minnesota, on behalf of the City. Notary Public STATE OF MINNESOTA) ) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this day of May, 1993, by the of MSCJ, Inc., a Minnesota corporation, on behalf of the corporation. Notary Public -3- 1.8 STATE OF MINNESOTA) ) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this day of May, 1993, by , the of Sheet Metal Connectors, Inc., a Minnesota corporation on behalf of the-corporation. THIS INSTRUMENT WAS DRAFTED BY: BARNA, GUZY & STEFFEN, LTD. 400 Northtown Financial Plaza 200 Coon Rapids Boulevard Minneapolis, Minnesota 55433 F: \realest \sln \mscj.sub Notary Public -4- 1.9 SUBORDINATION AGREEMENT THIS AGREEMENT, entered into on May , 1993, by and between Coon Rapids Development Company, a Minnesota corporation ("CRDC"); the Housing and Redevelopment Authority in and for the City of Fridley, a public body corporate and politic organized under the laws of the State of Minnesota ( "HRA "); and Sheet Metal Connectors, Inc., a Minnesota corporation and MSCJ, Inc., a Minnesota corporation ( "Co- Borrowers"). WHEREAS, MSCJ, Inc., a Minnesota corporation ( "Owner ") is the fee owner of that certain real property in Anoka County, Minnesota, legally described on the attached Exhibit A ( "Property "); WHEREAS, HRA is the owner and holder of a mortgage currently encumbering the Property, which mortgage is dated September 1, 1992, and was filed for record on March 4, 1993 as Anoka County Recorder Document No. 1025984 ( "HRA Mortgage "); and WHEREAS, CRDC has agreed to loan Seven Hundred Fifty Thousand and 00 /100ths Dollars ($750,000.00) to Co- Borrowers, which loan shall be evidenced by a note ("CRDC Note ") and secured by a mortgage dated May 1993, on the Property ("CRDC Mortgage "), which note will be guaranteed by the U.S. Small Business Administration; WHEREAS, CRDC has expressly conditioned its duty to advance the funds to the Co- Borrowers upon the CRDC Mortgage and CRDC Note being prior and superior to the HRA Mortgage; and WHEREAS, HRA has agreed to subordinate the HRA Mortgage to the CRDC Mortgage and CRDC Note in order to facilitate the receipt of the loan by Co- Borrowers. NOW, THEREFORE, in consideration of One Dollar and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged and of the covenants, promises, and conditions contained herein, the parties agree as follows: SECTION 1. SUBORDINATION HRA hereby covenants and agrees that the HRA Mortgage shall be considered, and in all respects shall be, subordinate to the CRDC Mortgage and CRDC Note and any extensions or renewals of the CRDC Mortgage or CRDC Note; provided, however, that the amount of this subordination shall not exceed the original amount of $750,000.00 with interest thereon as provided in the Note, together with all other costs or expenses advanced pursuant to the terms of the CRDC Mortgage or CRDC Note and the statutory fees allowed upon the foreclosure of the CRDC Mortgage. SECTION 2. FURTHER ASSURANCES HRA covenants and agrees that if reasonably deemed necessary by a title company or an attorney for a title company to properly document the subordination by HRA contained in.this Agreement, then HRA shall duly execute and °deliver to CRDC and such title company any instrument, document, conveyance, release or waiver which will more 1.10 fully and adequately subordinate the right, title, estate, lien and interest of HRA to the right, title, estate, lien or interest of CRDC. SECTION 3. MISCELLANEOUS A. All rights and obligations arising out of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties hereto. B. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Minnesota. C. This Agreement shall remain in full force and effect until 30 days after all amounts due CRDC pursuant to the CRDC Mortgage and CRDC Note have been fully paid and satisfied, and thereafter it shall terminate. After said termination, the parties shall execute such documents or instruments as may be necessary or required to remove any cloud on title caused by this Agreement. D. This Agreement or a memorandum thereof may be recorded in the appropriate offices in Anoka County, Minnesota to protect and give notice of the respective rights of CRDC and HRA hereunder. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed the year and day above first written. Coon Rapids Development Company, a Minnesota corporation By: Its: Housing and Redevelopment Authority in and for the City of Fridley, a public body corporate and politic organized under the laws of the State of Minnesota By: Its: -2- r ti 1.11 Sheet Metal Connectors, Inc., a Minnesota corporation By: Its: MSCJ, Inc., a Minnesota corporation By: Its: STATE OF MINNESOTA) ) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this of May, 1993, by , the of Coon Rapids Development Company, a Minnesota corporation on behalf of the corporation. STATE OF MINNESOTA) ) ss. COUNTY OF ANOKA ) The foregoing instrument wa of May, 1993, by of the Housing and Redevelopment Fridley, a public body corporate State of Minnesota, on behalf of Authority in and for the City of Notary Public s acknowledged before me this day , the Authority in and for the City of and politic under the laws of the the Housing and Redevelopment Fridley. Notary Public -3- 1.12 STATE OF MINNESOTA) ) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this day of May, 1993, by the of MSCJ, Inc., a Minnesota corporation, on behalf of the corporation. Notary Public STATE OF MINNESOTA) ) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this day of May, 1993, by ' the of Sheet Metal Connectors, Inc., a Minnesota corporation on behalf of the corporation. THIS INSTRUMENT WAS DRAFTED BY: BARNA, GUZY & STEFFEN, LTD. 400 Northtown Financial Plaza 200 Coon Rapids Boulevard Minneapolis, Minnesota 55433 F: \realest \sln \mscj- sba.sub Notary Public -4- 1.13 U ARTICLE VIII Mortaacae Financina Section 8.1 Limitation Upon Encumbrance of Property. Prior to the completion of the Minimum Improvements, as certified by the Authority, neither the Redeveloper nor any successor in interest to the Redevelopment Property or any part thereof shall engage in any financing or any other transaction creating any mortgage or other encumbrance or lien upon the Redevelopment Property, other than Permitted Encumbrances, whether by express agreement or operation of law, or suffer any encumbrance or lien to be made on or attach to the Redevelopment Property., other than Permitted Encumbrances, except: (a) For the purposes of obtaining funds only to the extent necessary for financing of the Minimum Improvements including, but not limited to, labor and materials, equipment, professional fees, real estate taxes, construction interest, organizational and other indirect costs of development, costs of constructing the Minimum Improvements, an allowance for contingencies, acquisition cost of the Redevelopment Property, costs of originating the Mortgage and customary financing costs. (b) Only upon the prior written approval of the Authority in accordance with Sections 8.1 and 8.2. The Authority shall not approve any Mortgage which does not contain terms that conform to the terms of Section 8.5, except as provided in Section 8.6 of this Agreement. Section 8.2 Approval of mortgage. The Authority shall approve a Mortgage if: (a) The Authority first receives a copy of all mortgage documents.' (b) The Mortgage loan, together with other funds available to the Redeveloper, will, in the reasonable judgment of the Authority, be sufficient to construct the Minimum Improvements; however, the Mortgage and Authority Mortgage shall not secure an amount greater than 90% of the costs described in Section 8.1(a). (c) The Authority is not entitled under Section 5.2 to exercise any of the remedies set forth therein as a result of an Event of Default. (d) The Authority determines that the terms of the Mortgage conform to the terms of Section 8.5. 17 1-14. However, the approval of a Mortgage by the Authority shall not be unreasonably withheld. Any Mortgage which is subordinated to the rights of the Authority under this Agreement may be granted in all or any part of the Redevelopment Property without the approval of the Authority. Section 8.3 Notice of Default: Covv.to Mortgagee. Whenever the Authority shall deliver any notice or demand to the Redeveloper with respect to any breach or default by the Redeveloper in its obligations or.covenants under this Agreement, the Authority shall at the same time forward a copy of such notice or demand to each Holder of any Mortgage authorized by this Agreement at the last address of such Holder shown in the records of the Authority. Section 8.4 Mortgagee's Option to Cure Defaults. After any breach or default referred to in Section 8.3, each such Holder shall (insofar as the rights of the Authority are concerned) have the right, at its option, to cure or remedy such breach or default (or such breach or default to the extent that it relates to the part of the Redevelopment Property covered by its mortgage) and to add the cost thereof to the Mortgage debt and the lien of its Mortgage; provided, however, that if the breach or default is with respect to construction of the Minimum Improvements, nothing contained in this Section or any other Section of this Agreement shall be deemed to require such Holder, either before or after foreclosure or action in lieu thereof, to undertake or continue the construction or completion of the Minimum Improvements, provided that any such Holder shall not devote the Redevelopment Property to a use inconsistent with the Redevelopment Plan or this Agreement without the agreement of the Authority. Section 8.5 Authority's Option to Cure Defer on Mortgage. Any Mortgage, unless such requirement is waived by the Authority, executed by the Redeveloper with respect to the Redevelopment Property or any improvements thereon shall provide that, in the event that the Redeveloper is in default under any Mortgage authorized pursuant to this Article VIII, the Holder shall notify the Authority in writing of: (a) The fact of the default. (b) The elements of the default. (c) The actions required to cure the default. If the default is an "Event of Default" under such Mortgage, which shall entitle such Holder to foreclose upon the Redevelopment Property, the Minimum Improvements or any portion thereof, and any applicable grace periods have expired, the Authority shall have, and each Mortgage executed by the 18 A 1.1s Redeveloper with respect to the Redevelopment Property or any improvements thereon shall provide that the Authority shall have such an opportunity to cure the "Event of Default" within such reasonable time period as the Holder shall deem appropriate. Section 8.6 Subordination and Modification for the Benefit of Mortgagees. (a) In addition to the subordination of the Authority Mortgage, in order to facilitate the obtaining of financing for the construction of the Minimum Improvements by the Redeveloper, the Authority agrees to subordinate its rights under this Agreement to the Holder of a Mortgage for the purposes described in Section 8.1(a) of this Agreement. (b) In order to facilitate the obtaining of financing for the construction of the Minimum Improvements, the Authority agrees that it shall agree to any reasonable modification of this Article VIII or waiver of its rights hereunder to accommodate the interests of the Holder of a Mortgage, provided, however, that the Authority determines, in its reasonable judgment, that any such modification(s) will adequately protect the legitimate interest and security of the Authority with respect to the Redevelopment Property. 19 ry- a 2.1 Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: May 5, 1993 TO: William Burns, Executive Director of HRA.J 4A FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: First -time Homebuyer Mortgage Program On April 30, 1993 we were notified by the Minnesota Housing Finance Agency that our application for the Minnesota City Participation Program (MCPP) had been received. Our application was. one of sixty submitted for a total amount of $73,635,998.00. As a result, individual allocations will be reduced significantly. Attached is a spreadsheet prepared by MHFA which describes several allocation options. These options show the potential bond authority which may be allocated by 1) a proportional reduction, and 2) proportional reductions with various "floor" allocations. Based on these scenarios, we will receive anywhere from $1,453,107 to $1,166,129. The final amount will be decided at a group meeting to be held at MHFA offices on Monday, May 12, 1993. It is important to point out that legal authority to issue mortgage revenue bonds has not been approved by Congress. It is uncertain when federal authority will be renewed, however the most optimistic projection is mid - summer. After the May 12th meeting, MHFA will begin drafting agreements for each city to sign. Once the ability to issue bonds has been authorized by Congress, MHFA will request each city to execute the agreement and submit a new deposit and application fee based on their respective allocation amount. The deposit will be refunded approximately two weeks after the bond sale. (The deposit and application fee we submitted with our original application will be returned on May 12th.) Staff Recommendation Staff recommends that the HRA approve the MCPP application and Resolution No. HRA 1 - 1993 authorizing participation in the MCPP. M -93 -256 O 2.2 1 O 1-4 Go a% cq CD m C, w 0� Ln w 0 m 0 N c c5 m m R cq 10 'o 0 10 Q -4 lm cq -4 rl m a m CD C� C% Go 0 co -1 1� � 1� 1� -! Ct -! li ll� 1� ll� m CD N ll� ll� 11! N 1� N -'DO co Ct 1-4 0% C, C) :, CD- at .0 Q 0 C, 0 N 14 a Ln c- . . U; a% w 6 c, cn- a -1 o w o C; W* w t, 0 w 0 m C3, v m . 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HRA 1 - 1993 RESOLUTION AUTHORIZING PARTICIPATION IN THE MHFA MINNESOTA CITY PARTICIPATION PROGRAM WHEREAS, the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority ") finds it desirable to encourage home ownership opportunities; and WHEREAS, the Authority finds it cost - prohibitive to issue mortgage revenue bonds on its own; and WHEREAS, the Authority has been invited to participate in the Minnesota City Participation Program offered by the Minnesota Housing Finance Agency (the "MHFA"); and WHEREAS, said program would issue bonds on behalf of the Authority for the purposes of providing low interest mortgage financing to first -time homebuyers. NOW, THEREFORE, BE IT RESOLVED that the Housing and Redevelopment Authority in and for the City of Fridley hereby authorizes and directs staff to submit an application for the MHFA Minnesota City Participation Program and further authorizes the Chairperson and Executive Director to enter into the necessary agreements for the implementation of the program. PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY THIS 13TH DAY OF MAY 1993. LAWRENCE R. COMMERS, CHAIRPERSON ATTEST: WILLIAM W. BURNS, EXECUTIVE DIRECTOR . 4'. -- APPLICATION FOR FUNDING MINNESOTA HOUSING FINANCE AGENCY 1993 MINNESOTA CITY PARTICIPATION PROGRAM FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY 6431 UNIVERSITY AVENUE N.E. FRIDLEY, MINNESOTA 55432 April 14, 1993 2.5 2.6 APPLICATION FOR FUNDING MINNESOTA HOUSING FINANCE AGENCY 1993 MINNESOTA CITY PARTICIPATION PROGRAM I. ELIGIBLE ORGANIZATION (a) Name and Address of Organization Fridley Housing and Redevelopment Authority 6431 University Avenue N.E. Fridley, MN 55432 (b) Name and Phone Number of Contact Person Grant Fernelius, Housing Coordinator, #572 -3591 (c) Bond Allocation Meeting Representative Same as (b) (d) Type of Organization HRA (e) $2,249,999, 28 loans at an average of $78,256 per loan II. ORIGINATING LENDER See attached letters of intent from Marquette Bank Brookdale and Metropolitan Federal Bank. III. HOUSING PLAN (a) & (b) Description of Principal Housing Needs In 1991,. the Housing and Redevelopment Authority commissioned the Maxfield Research Group to complete a housing market analysis of the City's housing stock. As a result of the market study, the City of Fridley conducted an in -house strategic planning process to develop recommendations to the City Council and the Housing and Redevelopment Authority to initiate an aggressive housing program. An Executive Summary of the study is attached. (c) Action Plan to Address Housing Needs To address some of the needs identified in the study, the City Council and HRA have either established or agreed to participate in the following programs: 2.7 APPLICATION FOR FUNDING MINNESOTA HOUSING FINANCE AGENCY 1993 MINNESOTA CITY PARTICIPATION PROGRAM PAGE 2 CDBG Housing Rehabilitation Program $181,000 has been allocated for this activity which will provide interest free grants to low income homeowners. HOME Housing Rehabilitation Program $70,000 'has been allocated under this program which provide grants similar to those described above. MHFA Great Minnesota Fix -Up Fund The HRA has allocated approximately $60,000 to provide gap financing for eligible households. Applicants who cannot afford the additional improvements which may be required and exceed the amount approved by the bank and MHFA may apply under this unique program to borrow up to $5,000 interest -free. MHFA Rental Rehab Loan Program Approximately $110,000 has been allocated to provide gap financing for multi - family owners who need additional improvements but cannot afford the cost beyond what is approved by the bank and MHFA for a loan. Fannie Mae - The HRA will allocate approximately $100,000 to enable eligible households to refinance their homes in conjunction with moderate rehabilitation. The funds would be used to provide loans of up to $6,000 for such purposes as interest -rate reduction, down payment assistance, closing costs, etc. Reserve Fund - $50,000 will be allocated to assist individuals who are ineligible for any other program or assistance. It should be noted that the programs described above are in the planning process but are anticipated to be operational by mid - summer 1993. (d) N/A (e) Plan Implementation and Administrative Capacity The housing rehabilitation programs described above will be administered in cooperation with the following organizations: ev�IMN&bw Yir3' IVNIV.. -I". 2.8 APPLICATION FOR FUNDING MINNESOTA HOUSING FINANCE AGENCY 1993 MINNESOTA CITY PARTICIPATION PROGRAM PAGE 3 - Fridley HRA - Anoka County Community Action Program, Inc. - Fridley State Bank IV. PROGRAM SPECIFICS (a) How Program Fits into Comprehensive Housing Plan The Fridley first -time homebuyer program will complement efforts by the City and HRA to improve the housing stock and provide opportunities to strengthen the livability of the community. The HRA's current financial position dictates that programming efforts are better suited to assisting homeowners via small grants or loans. The MCPP provides mortgage financing aimed at a market which the HRA is financially incapable of addressing. It is anticipated that the program will attract or retain younger households (those in the 18 -34 year old age group) in the community who may otherwise live elsewhere. (b) Borrower Income Limits The Fridley program will utilize the maximum income limits allowed under the MCPP. According to the 1990 census, the average household income was $36,855. Assuming some adjustments to this figure since 1990, it is still expected that an average household would qualify for the program. (c) Purchase Price Limits Although the Fridley program will incorporate the maximum purchase price limits allowed, the HRA may petition to increase the price limit at a later date. (d) N/A (e) N/A (f) N/A (g) N/A (h) Why Program is Good Candidate for Funding The Fridley MCPP would be a good candidate for funding due to the fact that the program has not been previously offered. Further, the Maxfield study indicated that ti 2.9 APPLICATION FOR FUNDING MINNESOTA HOUSING FINANCE AGENCY 1993 MINNESOTA CITY PARTICIPATION PROGRAM PAGE 4 Fridley, unlike other cities in the study area, had an increase in the number of households in the 18 -34 age group between 1980 -1990. The City is therefore uniquely positioned to retain these households in the community by providing an opportunity for young households to move through the housing life cycle and purchase a single family home. The Maxfield study also identified a strong single family market in Fridley. Housing values have remained relatively stable making homes attractive and affordable to first -time buyers. V. ECONOMIC VIABILITY It is anticipated there will be sufficient demand for the MCPP funds. Based on data provided by the City's Assessing Department, in 1992 there were 303 single family home sales. Below is a chart which shows the number of sales and average sales f h price or omes in selected price ranges: No. of Percent Price Range Sales of Total Average Price $10,000 - $49,999 7 2% $ 45,298 $50,000 - $59,999 10 3% $ 55,010 $60,000- $69,999 39 13% $ 65,984 $70,000 - $79,999 75 25% $ 75,853 $80,000- $89,999 71 23% $ 84,162 $90,000 - $99,999 40 13% $ 94,206 $100,000 + 61 20% $127,285 As evidenced by these statistics, more than 40% of the sales were in the $80,000 category or less and approximately 2/3 of the sales were in the $90,000 category or less. Many of these homes would be suitable for purchase by first -time buyers. VI. NEW CONSTRUCTION Due to limited activity, new construction will not be included as part of the Fridley MCPP. VII. SIGNATURE William W. Burns Date Executive Director Fridley HRA U. Marquette Bank Brookdale... 5620 Brooklyn Boulevard Brooklyn Center. MN 55429 -3084 (612) 561 -2530 April 12, 1993 Mr. Grant Fernelius City of Fridley 6431 University Avenue N.E. Fridley, Minnesota 55432 RE: 1993 Minnesota City Participation Program Dear Mr. Fernelius: 2.10 This letter shall serve as Marquette Bank Brookdale's intent to participate in the above referenced mortgage program in your community. Please note that any future correspondence relative to this program should be directed to the attention of Karen DuCharme, Assistant Vice President, Mortgage Department. Sincerely, Karen L. DuCharme Assistant Vice President Mortgage Department 04 -12 -1993 17:07 22S-1310 The Heartlands Bank? For Home Loans. April 12, 1993 City of Fridley 6431 University Avenue N. E. Fridley, MN 55432 Attn: Grant Fernelius Dear Mr. Fernelius: hEIROPOLITAN FEDERAL BANK i W 2.11 P.02 Please accept this letter as confirmation that Metropolitan Federal Bank is willing to be a lender for the City iof Fridley under Minnesota Housing Finance Agency's Minnesota City Participation Program. If there is any other information you need, to contact me at 225 -7215. Sincerely, METROPOLITAN FFDERAL BANK, fob 4L,&� !10 -r ... ............. 1, ............. . ...... Colleen p. O'Kane vice President cpo pleape do not hesitate MT"M W iMtRU W= N1dMG • 486 AODW STREET NORTH • Sr PAU1. MN 55101 -8019 • *10W (618j885-7W0 • MX (618 .7306 COME "atom LOW 3,1 Community Development Department D HousnvG arm REnEVEropMErrr AuTHoxiry City of Fridley DATE: Mav 6. TO: William Burns, Executive Director of HRA44 V FROM: Barbara Dacy, Community Development Director SUBJECT: Consideration of Additional Improvements in Cooperation with Mississippi Street Improvement Project The Mississippi Street improvement project was initiated on April 12, 1993. A number of issues have come to our attention which the HRA needs to review and provide additional direction to staff. 1. Rice Plaza Traffic Flow It was originally contemplated that the drive - through traffic for the Dairy Queen would have to be realigned from its current location to the front of Rice Plaza and then exit to the rear of the Rice Plaza building. In fact, as part of the 1991 lease agreement with Dairy Queen, the HRA agreed to pay for the costs of the realignment. The HRA is not now obligated as part of the Dairy Queen lease to make those improvements because the Mississippi Street improvement project did not start until July 1, 1992, as stipulated in the Dairy Queen lease. Unanticipated, however, was the impact of the street widening on the Rice Plaza parking lot. The contractor has identified on the parking lot pavement where the new curb line would be placed after the widening of Mississippi Street. It was determined that there was only 38 feet from the edge of the new curb to the east end of the building. The distance widens toward the west end of the building. Staff conducted "parking tests" on site as well as measuring parking spaces and driving lanes to determine if Proper traffic flow could be achieved on the property. We have also received complaints from tenants about the traffic flow on the property. We received one letter objecting to the Dairy Queen traffic being routed in front of the Rice Plaza building. In order to provide for proper traffic safety on site, staff has developed a striping and improvement plan to accommodate traffic from the Rice Plaza building and the Dairy Queen Mississippi Street Improvement Project May 6, 1993 Page 2 2. 3.2 drive - through (see attached) . The plan proposes a one -way driving and parking condition from west to east. A separate lane will be striped for Dairy Queen traffic. Angled parking space stripes will be added to the front of the building. While the Dairy Queen traffic will continue to exit from the existing driveway, Rice Plaza traffic will need to be routed to the rear of the building on a new driveway to connect to Third Street. Using the existing pavement at the rear of the building is unsafe because of poor sight lines, broken pavement, and proximity to loading areas. Estimated cost for the improvement is $5,000. The County has agreed to perform the pavement work; a separate contract with a striping company would be executed. The budgeted amount for this project is $300,000. Current estimates for HRA costs are $250,000 plus about $30,000 in engineering fees (County ;and MnDOT changes) . There is an adequate surplus in the Mississippi Street improvement budget to accommodate this expense. Recommendation: Staff recommends that the HRA authorize staff to execute the necessary documents to complete the improvement as shown on the attached plan. Landscaping Replacement at Target and Holly Center Sites First, the good news! The County has agreed to save the White Oak on the Target site, and the sidewalk will be routed around the tree. The bad news is that some of the vegetation along the Target and Holly Center sites will be affected by the street widening. When the landscaping was originally installed, bushes and shrubs were located in anticipation of the street widening. Unfortunately, the construction area around the right -of -way will necessitate the following: (1) Removal of four evergreens at the southwest corner of 5th Street and Mississippi Street (2) Removal of two evergreens on the west side of the Target driveway (3) Removal of bushes and five Crab trees along the north side of the Target building (4) Removal of all vegetation along the Holly Center parking lot. We have instructed the contractor to save as much as possible. 3.3 Mississippi Street Improvement Project May 6, 1993 Page 3 In the case of the Holly Center site, the City assessed the cost of the landscaping as part of the parking lot improvement project. Target installed its landscaping as part of its development project. The HRA owns the property surrounding the Target building including the parking lot. Because the existing property owners have already incurred the initial expense for the landscaping and because removal of the vegetation will significantly detract from the appearance of the intersection, staff recommends that the vegetation be transplanted or replaced. Further, without the landscaping, the properties would be in violation of existing landscaping ordinance requirements. We have obtained quotes from two landscaping companies. Replacement of all the vegetation would total approximately $9,600; this includes transplanting the Crab trees and replacement of the evergreens. Again, enough surplus exists in the improvement budget. Recommendation: Staff recommends that the HRA authorize staff to execute contracts to transplant or replace vegetation as necessary at a cost not to exceed $9,600. 3. Landscaping at the Intersection As part of the University Avenue Corridor improvement plans, landscaping was proposed at every intersection along University Avenue. During the Mississippi Street project review in 1991, staff requested the County to include the intersection landscaping as part of the project. In a letter dated March 15, 1991, to John Flora, the County requested the City to install the plantings in the fall after construction. As you know, the project was delayed one year, and the County proceeded to let the contract without the landscaping element. It is cheaper for the HRA to bid and to install the landscaping. Apparently, according to the County, it is typical for the general contractor to add a specified percentage increase on top of the subcontractor cost. The vegetation in the intersection would be located at each of the four corners and along the abutting rights -of -way. Given the expenses cited above, we should solicit quotes from landscaping companies to determine the cost of the landscaping improvements. At that time, the HRA can decide whether to proceed with a fall installation or wait until the next budget year. After expenses for items 1 and 2 above, about 95% of the budget will be expended. We should have final costs from the County in August. 3.4 Mississippi Street Improvement Project May 6, 1993 Page .4 Recommendation: Staff recommends that the HRA authorize staff to solicit quotes for the intersection landscaping and schedule final action for the HRA in August or September. BD:ls M -93 -254 4 3.5 6 I i .k tWa�maeo!1 . � �. L� �.TA � +:• �"1 41z` i In JA_ 1 . 00 IIo I I a 8 I is m Ix C4 3943 118 1SD(3 - r q X75 � .sa f O 4 ♦ AZ Engineering Sewer Water Parks Streets Maintenance MEMORANDUM TO: Barb Dacy, Community Development Director PW93 -142 FROM: Scott Erickson, Asst Public Works Director 9LI DATE: April 20, 1993 SUBJECT: Rice Plaza Driveway Extension Cost Estimate Per our conversation, the following cost estimate was generated to construct a 20-ft wide' temporary asphalt drive (one -way traffic) behind Rice Plaza to direct the flow of traffic at this location out to 3rd Street. The estimated cost breakdown is as follows: 2' /z thick - #2341 asphalt wear course 4-in. thick - Class 5 base material Common excavation No parking and one -way templates Signs Parking lot striping Total Estimated Cost vt w boo �Z x7 _g� $2,000 1,000 600 200 100 800 Depending on the timing of this work, we may be able to include this with the current County reconstruction contract with Forest Lake Contracting. The alternative options are to include the work in our 1993 street reconstruction project or let a separate contract. Let us know if you would like to proceed with this construction. SE:cz W_ CIIYOF FRUX" 1 3.8 COUNTY OF AN Department of Highways Paul K. Ruud, Highway Engineer 1440 BUNKER LAKE BLVD NW, ANDOVER,,MINNESOTA March 15, 1991 City of Fridley 6431 University Avenue NE Fridley, MN. 55432 Attention: John Flora Director of Public Works Regarding: Mississippi Street Improvement SAP 02- 606 -08 Dear Mr. Flora: We have received your letter dated February 27, 1991, regarding final adjustments in the plans prior to bid letting. I have the following comments on your letter. 1) Page 3 the median note on concrete paving stone pavement appears to be appropriate. from my perspective. 2) The Anoka County Highway Department has long used lanin stone for retaining walls and in the interest of continued consistency would prefer to use lanin stone rather than key stones. 3� The Cit}�s standard sidewalk is 5 feet wide. The drawing indicates sidewalk 5 feet 21/2 inches in width on some locations. This is to allow for a straight backside to the sidewalk and allow for the placement of the concrete paving stone pavement in a checker board type pattern as requested by the City. 4) The City method for securing the concrete paving stone pavement has been added to the plans. 5) The note regarding B618 Concrete Curb and Gutter has been relocated to a more appropriate location. 6 & 8) Quantities have been included or will be included by Change Orders to accomplish this construction at the time you provide them for us. 7) 250 Tons of bituminous material has been added for parking lot in front of the municipal liquor warehouse. 9) The two street lights in conflict with the entrance to Billings Drive have been relocated immediately to the west side of the driveway. Affirmative Action / Equal Opportunity Employer 50Z 10) Stamark material has been specified the intersection in lieu of painting. The maintenance of this Stamark material. 3.9 at the stop bars and cross walks at City will be responsible for 11) Because of the anticipated lateness of construction and the problems that Anoka County foresees in providing the plantings called for in the Barton - Aschman Corridor Plan. We suggest that the City of Fridley provide for those plantings in the Spring of 1992 following construction. Our plans include the preparation of an area for these plantings, but feel the most appropriate for you to not only provide the plantings but also provide the guidance and administration necessary for their installation. In addition we would anticipate poor survival over the Winter of 1991 - 1992, should they be planted in the Fall and considering the fragile condition of newly planted shrubs along with the anticipated amount of sand /salt spray which they will undoubtedly receive at that location. The total cost of these plantings will be borne by the City in either case and it would seem appropriate that the City install them in the Spring of 1992. Hopefully these items to the City of Fridley. Agreement and shoul additional information will be consistent with our recent discussions and acceptable I am in the process of revising the proposed Cost Sharing d have that to you in the relatively near future. If you need in the interim, please call myself. Olson, PE County Engineer e 4.1 C% Community Development Department D HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley May 6, 1993 Burns, Executive Director of HRA 4pl- William Barbara Dacy, Community Development Director LCT: Consider Amended Leasehold Agreement for Fridley Plaza Office Building Parking Lot February 13, 1992, the HRA approved a third amendment to the leasehol cement between the HRA and Columbia Park Properties to correct a lega - ription error. At that time, the attorney for Columbia Park Properties Hurley, suggested that since the amendment was the third amendment, leasehold agreement should be prepared to incorporate all previou urther, Columbia Park Properties hired Frauenshuh Companies to manage t ffice building. Staff has met Frauenshuh Companies on a number of occasio egarding the ongoing maintenance issues including snow removal, parking 1 aintenance, and lawn and irrigation maintenance. None of the previo easehold agreements specifically stated maintenance responsibilities. These two factors have led both staff and Columbia Park Properties to a revised leasehold agreement. Since the Fridley Plaza Office Building was constructed, the City has responsible for maintaining the irrigation system to the boulevard a along Fourmies Avenue and 5th Street, as well as to the vegetation in Plaza area. Further, the City has been responsible for the lawn vegetation maintenance in these area as well as snow removal miscellaneous parking lot items. The original lease agreement stipulated an $800 per month rental payment As the HRA will recall, the former owners of the property were in arrears an an agreement was made to waive $9,200 in delinquent rental payments upo payment of $10,000 and satisfactory payment of the rent for three years unti April 1, 1994. The current owners are paying the rent on time. 4.2 Amended Leasehold Agreement for Fridley Plaza Office Building Parking Lot May 6, 1993 Page 2 The original lease also stipulated a term of 99 years. The term of the proposed lease has not changed. The original lease also provided the property owners with the option to purchase the parking lot at the termination of the lease in the year 2081 (see paragraph 5 in proposed lease). Paragraph 6 of the proposed lease specifies maintenance responsibilities. Columbia Park Properties will be responsible for ongoing snowplowing of the parking lot, and the City will be responsible for removing the piles of snow within 72 hours. This has been the general arrangement between the City and the building owner in the past. The City is also responsible for street and parking lot lighting. There is no change to this responsibility. Since the parking lot was constructed, the parking lot has not been sealcoated or restriped. Columbia Park Properties is requesting that the parking lot be sealcoated and striped this year. The proposed agreement proposes a semi - annual striping and sealcoating of the parking lot. A semi- annual schedule is excessive. Staff recommends the lot be sealcoated and striped once every four years. Estimated cost of the sealcoat and the striping is approximately $2,400- 3,400. The annual rent payments of $9,600 could be used to defray the maintenance expenses. The proposed agreement also provides for the continuing maintenance of the lawn and shrubbery in the boulevard areas along the streets. Any vegetation, however, within the Columbia Park Properties' property lines (see attached survey) would be the property owner's responsibility. At some time in the future, the parking lot may have to be repaved. The agreement stipulates that the HRA would be responsible for this cost. An estimated cost for repaving is approximately $4,500. Finally, the agreement proposes that the HRA sweep the parking lot in the spring and in the fall. The Public Works Department has swept the parking lot according to this schedule. Recommendation Staff recommends that the HRA authorize the Chairperson and Executive Director to execute the revised leasehold agreement subject to amending paragraph 6C, the last sentence, to read: "...the option parcel shall be sealcoated and striped once every four years." Further, staff recommends the HRA authorize staff to execute contracts to have the parking lot sealcoated and striped in cooperation with the property owner. BD:ls M -93 -259 Ile \0.`O E L \T W% s ae-sT yo-E N 1eOZ 20-¢ - SBB'STyO'C- /i .4ppr1o>< �06t T /fin Ivafe� \�N\) MO W57' 4i0' 1 h \ N1• oz! zo % M M&8'37'%44 b o v 4.3 • - I B•��a-e�. e.G M'•- Bf�68 %YS E /S3.p8 A /o/OK edyc '� /�.i.,;ine�.a 17 5: •'F Bee /ay. -��+:: Jt': .� - 'Q�oProx iJ ryiound 6/a �� 3 .fit• r�} Fridley Plaza Office Bldg. — 6401 Un _ 0 �versity Ave. N.E. ;::`: ' :• - -:• :: f• �G o tj k n- 3 —ST —Brick 14 � N 4 h s , : ' o ' E�scw ivr B 11386.4 S.F. tj MN Tire Cer. or /'1t Q,a. e Fourmis •Ave -: t s -I- w "W"m - jr IV- 77\ 612 780 1777 FROM BRRNA GUZY S. 6.1993 13938 P. Z 4.4. AMBNDED MW RNGTATSD X MWM0LD This Amended and Restated Leasehold Agreement, entered into this day of May, 1993, by and between THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOM (hereinafter called the "HRA "), and COLUMBIA PARK PROPERTIES, a Minnesota Partnership (hereinafter called "Redeveloper "). WHEREAS, on the 20th day of September, 1982, the HRA and the Fridley Office Plaza Building Partnership entered into a Leasehold Agreement ( "Leasehold Agreement ") which required the HRA to provide the Fridley Plaza office Building Partnership with a non- exclusive right to lease a 166 car parking lot; and WHEREAS, the Leasehold Agreement was amended pursuant to Amendment to Leasehold Agreement, dated August 1, 1988, providing for the construction of a parking ramp on the site of the parking lot; and WHEREAS, the Leasehold Agreement was further amended by rrdtAt..,.- - dated -February 22, 1989, which revised the legal ie on of the property subject to the Leasehold Agreement to Fridley Plaza Office building Partnership additional ngress and grass aec 'pss to the parking ramp parcel; and WHEREAS, the HRA-Atd the ridley Plaza office Building P nership entered intd�; at ertain Memorandum of Leasehold A ement, dated February 2, 989, filed March 9, 1989, in the 0 ae of the Anoka County ee rder as Document No. 842658, to e to ish the Leasehold Agr�em nt of record; and WH , the Fridley Plaz Office Building Partnership a igned is interest in the Leasehold Agreement to Performance I estmen s, a Minnesota Pattn rship, by Assignment, dated March 3, 1989; nd :i WHER S;`PPrf Ave tments assigned its interest in it easehold Agreement to Red veloper by assignment of Leasehold Interes s'�"'cia ed August 29, 19 1; and WHEREAS, the parties to this Agreement have discovered that the new legal description is not correct and the parties agree that the Leasehold Agreement, as amended, should be further amended and restated to clarify the terms and conditions thereof. NOW, THEREFORE, the parties to this Agreement, in consideration of the promises, covenants and agreements made by each to the other, do hereby agree to amend and restate the Leasehold Agreement as follows., 14 Lase / Purpose. The HRA hereby leases to the Redeveloper the property described on Exhibit A ( "Leasehold Property ") attached hereto for the purpose and non - exclusive use of the property for parking of vehicles associated with the use 01L risu 1 rrr FROM BARNA SUZY 5. 6.1993 13:39 P. 3 . 4.5 and operation of the building located on land owned by Redeveloper and described on Exhibit B attached hereto ( "Redeveloper Property "). Further, the HRA grants to Redeveloper or any future holder of the lesseel's interest herein, for the benefit of the Redeveloper Property, the non - exclusive right of ingress and egress over and across the Leasehold Property. This lease shall be binding upon the heirs, successors and assigns of the Redeveloper. The Leasehold Property includes the parking lot and bi -level ramp. 2. Term of Lease. The term of the Lease commenced September 20, 1982 and continues until September 20, 2081, unless sooner terminated as provided herein. 3. Monthly Rent. The Redeveloper shall pay as and for the rental of the Leasehold Property as defined herein, the sum of Eight Hundred and No /100 Dollars ($500.00) per month. Rental payments are due on the first day of the month and shall be considered late after the tenth day of the month. 4• ck Rent. Performance Investments, a Previous holder of the Lessee's interest in the Leasehold Property was delinquent in lease payments under the Leasehold Agreement in the amount of $19,20o.00. In consideration of the payment of $10,000.00 to the HRA by Redeveloper, the HRA agreed to waive and forego $91apo.0o in delinquent rental payments awed under the Leasehold Agreement on the condition that Redeveloper PAYS all rental payments when due or within 30 days after receipt of written notice of the payment being due, for all monthly rental payments which are due through April 1, 1994. On April 1, 1994, if Redeveloper has paid all rental payments due and owing as provided herein, then in such event, all delinquent rent referred to herein shall be deemed forgiven. In the event Redeveloper fails to pay any rental payments within thirty days after receipt of written notice as provided herein, then in such event, in addition to any other remedies available, the HRA may demand that the additional $9,200.00 in delinquent rental payments be paid in full immediately. 5. Option to E chase. Upon the expiration of the lease term as provided herein, assuming Redeveloper has not defaulted under the terms and conditions of said lease, then in such event, the Redeveloper shall have the option to purchase from the HRA the real property described on Exhibit C attached hereto ( "Option Parcel "). The purchase price for Option Parcel shall be its fair market value at the time the option is exercised. In the event Redeveloper exercises this option, then in such event, Redeveloper and the HRA shall close on the purchase of the option Parcel within 90 days after the expiration of the Leasehold Agreement. The HRA shall be obligated to deliver marketable title to the Option Parcel free of any liens or encumbrances delinquent taxes and special assessments. The Redeveloper may -2- 612 780 1777 FROM BRRNA OUZY . �_ . ..� ..,... �.. .. �.. ,. _,.. .- ,..��. �.� ... ,..U.., i:.�.�:L- �.'v'.��• •- •mac-- S`L'�.Li�:^,"^!y ssu.��::.�:�:i.: 5. 6.1993 13339 4.6 P. 4 exercise this option only be delivering written notice of its option tv purchase by certified mail or by hand delivering to the MM not more than twelve months nor less than six months prior to September 20, 2081. In the event the HRA and Redeveloper cannot come to an agreement as to the fair market value of the Option Parcel, within thirty days after the Notice of Option to Purohase has been delivered as provided herein, then in such event, the fair market value of the Option Parcel shall be determined in the following manner: Both the HRA and the Redeveloper shall each select an MAI certified appraiser and they shall each mutually agree upon a third MAI certified appraiser. The average of the three (3) appraisals shall them be the fair market value. Both the HRA and the Redeveloper will pay for the cost of the appraiser which they appoint and shall share equally in the fees incurred for the third appraiser. 6. Maintenance of the Leasehold Property. (i1) Snow Removal. Redeveloper shall be obligated to provide the snow removal, at its sole cost and expense, of the Option Parcel, which property is included in the Leasehold Property and shown as the cross- hatched parcel on Exhibit D hereto. Nothing herein provided shall obligate Redeveloper to do any snow removal on any remaining portion of the Leasehold Property. All snow removal on sidewalks connecting the option Parcel and Redeveloper's property shall be completed by Redeveloper at its sole cost and expense. Redeveloper shall be obligated to push all snow accumulations from the Option Parcel to an area of the Option Parcel which shall be agreed upon by the City and Redeveloper. Within 72 hours after placing said snow in the area of the Option Parcel described above, the HRA agrees to remove, at their sole cost and expense, the snow placed in said area by the Redeveloper. (b) Street and Parking Lot. All lighting of streets and parking lot which is adjacent to the Redeveloper's property and serves said Leasehold Property, shall be paid by the MM. (c) MaiAtenance, seal coating and Striping the option Parcel Leasehold Property. All maintenance, seal coating, striping and resurfacing of the option Parcel shall be undertaken and completed by the HRA at its sole cost and expense. All striping, seal coating or resurfacing of the Option Parcel shall be done on an as needed basis. The Redeveloper shall contact the-KRA and notify the HRA of its request for any such maintenance, seal coating and striping of the Option Parcel. The HRA and Redeveloper agree that -3- 612 780 1777fi FROM BARNA 6UZV S. 6.1993 13140 P. 5 4.7 the Option Parcel shall be seal coated and striped at least semi - annually. (d) Maintenance of Lava and Shrubbery. Any lawn area, shrubbery located on the Redeveloperls Property shall be maintains] by Redeveloper at its sole Cost and expense. Any lawn area or shrubbery lying outside of the Redeveloper's Property and included within the Leasehold Property hereto shall be maintained at the sole cost and expense of the HRA. (e) Paving and Curbing of Leasehold property. Any paving and curbing replacement of the Option Parcel shall be at the sole cost and expense of the HRA. (f) Parking Lot sweeping. The HRA shall, at least once each spring and once each fall, during the lease term, sweep the Option Parcel. 7. Real Estate Taxes and SRecial Assessments. All real estate taxes or special assessments levied against the Leasehold Property shall be paid by the HRA, 8. Djfault. In the event of any default or failure to pay rent under the terms and conditions provided herein and Redeveloper fails to cure said default within 30 days after receipt of written notice from iiRA, then in such event, the HRA may terminate the lease. The only remedy of the HRA for failure to Pay the rent or any other violation of this lease shall be termination of this lease. IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed as of the day and year first above written. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOTA By. • Lawrence R. Commers Its: Chairman By: William W. Burns Its: Executive Director -4- 612 780 1777 FROM BARNR SUZY STATE OF MINNESOTA) COUNTY OF ss. ) 5. 6.1993 13941 4.8 P. 6 The foregoing instrument was acknowledged before me this day of 1993, by Lawrence R. Commers, Chairman' and William W. Burnes, Executive Director, of The Housing and Redevelopment Authority in and for the City of Fridley, Minnesota a political subdivision of the State of Minnesota, on behalf of said Authority. Notary Public COLUMBIA PARK PROPERTIES By. • A Managing Partner By. • A Managing Partner STATE OF MINNESOTA) COUNTY OF ss. The foregoing instrument was acknowledged before me this day of , 19931, by an t� Propert es, a Pat-tnersh Managing partners o Columb a Park Minnesota on behalf of the Partnershipws of the state of THIS INSTRUMENT WAS DRAFTED BY: BARNA, GUZY & STEFFEN, LTD. 400 Northtown Financial Plaza 206 Coon Rapids Boulevard Minneapolis, MN 55433 (612) 780 -8500 (MF$) -5- Notary Publ o b12 780 1777 FROM BARNA SUZY 5. 6.1993 13:41 Z=IDZT A TMOMOLD PROPERTy 4.9 Lot 15 and all that part of Lot 7, Block 1, Fridley Plaza Center, Anoka County, Minnesota lying easterly of the following described line, Commencing at the northwest corner of Lot 14, said Block 1; thence North 89 degrees 58 minutes 45 seconds East,-along the north line of said Lot 14, a distance of 13.00 feet, to the point of beginning of the line to be described; thence North 0 degrees 47 minutes 15 seconds East a distance of 213.23 feet to a point on the line Common to Lots 6 and 7, said Block 1, said point being 3.00 feet westerly from the southeasterly corner of said Lot 6, and said line there terminating. -6- P. 612 780 1777 FROM BARNR 6UZY 5. 6.1993 13241 p, B ZJMZBIT e RDav&LOPER PROPIMTT 4.10 Lot 14, Block 1, Fridley Plaza Center, according to the recorded plat thereof, and situate in Anoka County, Minnesota. -7- 612 780 1777 FROM BARMA SUZY TO be determined. 5. 6.1993 13142 WMIBIT Q OPTION PARONL -e- 4.11 P. 9 TO: WILLIAM W. BURNS, CITY MANAGER .A FROM: RICHARD D. PRIBYL, FINANCE DIRECTOR 5.1 SUBJECT: RESOLUTION DESIGNATING OFFICIAL DEPOSITORIES DATE: May 6, 1993 Attached you will find the resolution that ordinarily is placed on the agenda the first meeting of January. Due to an oversight we did not prepare this resolution for the HRA until recently. This resolution assigns the Fridley State Bank as the Official Depository for the HRA. The resolution also provides that the City Manager, Finance Director and the Assistant Finance Director as the official signers for the HRA checks. RDP /me Attachment 5.2 RESOLZTl'I@i W. EMA 2 - 1993 Y:I" 11 ) t 6)DVI 61 • ', [54 Ij 6:'40' IT IS HEREBY RESOLVED that the Fridley State Bank is hereby designated as a depository for the funds of this corporation. IT IS FUG RESOLVED that checks, drafts or other withdrawal orders issued against the funds of this corporation on deposit with said bank shall be signed by two of the following: Richard D. Pribyl, Finance Director-Treasurer William W. Burns, Executive Director /City Manager Howard D. Koolick, Assistant Finance Director and that said bank is hereby fully authorized to pay and charge to the acct of this corporation any checks, drafts, or other withdrawal orders. BE IT FURnm RESOLVED that all transactions, if any, relating to deposits, withdrawals, re- discounts and borrowings by or on behalf of this corporation with said bank prior to the adoption of this resolution be, and the same hereby are, in all things ratified, approved and confirmed. BE IT FUR RESOLVED that any bank or savings and loan may be used as depositories for invest purposes so long as the invests comply with authorized invests as set forth in Minnesota Statutes. BE IT FURTHER RESOLVED that the signatures of two of the following named City employees are required for withdrawal of BRA investment funds from savings and loan associations: Richard D. Pribyl, Finance Director - Treasurer William W. Burns, Executive Director /City Mgr. Howard D. Koolick, Assistant Finance Director BE IT FUG RESOLVED that any brokerage firm may be used as a depository for investment purposes so long as the investments ccuply with the authorized invents as set forth in Minnesota Statutes. PASSED AND ADOPTED BY TBE HOUSING AND REDEVEIOPNM AIMMRITY OF 'IHE CITY OF FRIDLEY THIS 13TH OF MAY, 1993. I 1 I M R�;yIS(I�i�a. M� /L V4 VI -1 ., U-1 e Z i Q °v0 °aCd°avc roo ooMma<0immbl '.001sotv-#°o4c0°QOo -r m -i ... .< < # 01 a�fii�0�IIttM i�tN0.00, M00Aat .pi)i,-.tt'r4NV) 0MVig!fi1l0N0M0� 01 1 ; v0• rota vMM00-,icv 0 10 1�-0*aN0Maav0 VA v NV4Nst V 0M<00v3smm0ma4r l.V 10 a OM d. A of .+ CD 4r ra N v 011` bj -0 1 # a 1t 1 1 t : 1 i i # 1 1 1 i ' i # i 1 H i U I W � 1 u M 1 t A t ! 6 I ! 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MM0%M0,M00,010'I0. w01I9M0MaM0.iA \\\ \\\\\\\ \\\\\\%I%,N%\N. \N,1\\\I\a�IM1a1 tnMMMMMMMMM6iNAO O�MMMMMMMMMMMMM M M a.aaa.+aaa.+aa14 -1vi M \ a vvvvvvvvvvvvvvvv r)biinin nnin nb mine inin»bj nin nin e C F 0 F W Lh z C L P A 6.1 TO: FRIDLEY H.R.A FROM: CITY OF FRIDLEY RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES APRIL 1993 ADMINISTRATIVE BILLING: ADMINISTRATIVE PERSONAL SERVICES ADMINISTRATIVE OVERHEAD TOTAL ADMINISTRATIVE BILLING: OPERATING EXPENSES: POSTAGE BY PHONE - POSTAGE CITY OF FRIDLEY - 92 LANIER COPIER ALLOCATION TOTAL OPERATING EXPENSES: TOTAL EXPENDITURES - APRIL 1993 He : \1 23DATA\HRA\TlF\93BlLLwkl 6.2 13,842.00 460-0000-430-4330 - 14,092.00 460-0000-430-4332 42.63 460-0000-208-0000 27.74 70*.37 9 t d O ui 190 ag�a z u u W OC W 6 cm (yu OC J J I m r- I N C7 1 O 01 t M I 1 ell � � P w u Vs I I I I 6 I W 1 O I a j 0 0 0 E W + u•.0 x o>-o to�oo i� «J+Y►oC+W Z2Y Y C7 � RUH I{��- , 1 1 it aa�1�S �CF. 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ION`QN . 11ti 11N NNNNN M M M M M M M M M M M M M M M M M Ln \ \s\\ Y1N V1{l1 v1h NV1 V1N1H1 V11AMMMNI SHWIM "990,12 tiMf` So O2 N W 1cC F- vC.2v !�I N W 9 2 O 4M VJ g 6.3 r � i 7.1 Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: May 5, 1993 TO: William Burns, Executive Director of HRA440 FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Status Report on HRA Housing Rehab Programs This is to provide an update on the status of the various housing rehab programs. CDBG Home Improvement Grant Program For the past couple of weeks Grant has been preparing an administrative plan for this program. To date, he has identified the major implementation tasks and received approval from Anoka County to split administrative responsibilities between the HRA and ACCAP. On May 5th, Grant sent a letter to Patrick McFarland of ACCAP soliciting their involvement to jointly administer the program. Hopefully by the end of the week we can schedule a meeting with ACCAP to discuss our ideas and begin negotiations on the matter. If all goes well we could begin taking applications by mid June. HOME Rehab Grant Program Funding for this program won't be available until later this year, possibly not even until this fall. However, we have made a revision to the income guidelines for the program. In the original application sent to HUD, we stated that we would use the rules of the existing rehab grant (i.e. CDBG) program. As you are aware, the income guidelines for the CDBG program are extremely low and exclude many homeowners who potentially won't qualify for a loan. In an effort to assist these individuals, we have raised the income guidelines to 500 of area median income as published by HUD. A comparison of the income guidelines is shown on the next page. 7.2 Memo to William Burns May 5, 1993 - Page 2 Household Size Old Limit New Limit 1 $9,668 $17,350 2 $12,644 $19,850 3 $15,620 $22,300 4 $18,832 $24,800 5 $22,044 $26,800 6 $25,260 $28,750 7 $28,472 $30,750 8 $31,684 $32,750 Because we will be using the same delivery method as the Home Improvement Grant Program (i.e. joint administration with ACCAP), we will already have the procedures in place to begin taking applications by the time HOME funds become available. As a result, we shouldn't have any additional delays in starting the program. As with the CDBG program, we plan on conducting a pre- screening process to ensure that funds are directed to those most in need. MHFA Home Improvement Loan Program Also over the past several weeks, Grant has been reviewing the HRA plan to provide so called "gap" financing to be used in conjunction with the MHFA Home Improvement Loan Program. As you are aware, several changes have been suggested by Grant on the use of HRA funds. Originally, the concept was to assist those borrowers who couldn't qualify for all of the necessary financing through the bank. In looking at this plan more closely, several issues came up. Based on experience, it appears that someone would fall into the gap for one of two reasons: 1. High debt load 2. Lack of equity Under most other circumstances (i.e. bad credit, ineligible improvements, over - income, etc.) the applicant would be rejected and unable to secure any type of MHFA loan financing. Looking at this issue from a practical perspective, the following questions were raised: 1. Is it fair to assist what is essentially a small group of people, many of whom are marginal or even poor credit risks (for whatever reason)? 7.3 Memo to William Burns May 5, 1993 - Page 3 2. Is the subsidy level too high, thereby concentrating HRA resources in fewer households and effectively reducing its ability to assist as many people as possible? In addi- tion, there is also greater risk to the HRA in the event of borrower default. 3. Are we losing control of the process by allowing the bank to decide which applicants fall into the "gap "? As an alternative to this approach, Grant suggested a program which would utilize HRA funds to reduce the principal amount of loans for eligible borrowers. The concept would be to 1) encourage people to make improvements to their homes, 2) assist those who qualify for a loan (i.e. good credit risk) , 3) maximize HRA dollars by reducing the subsidy level, and 4) reduce risk to HRA funds. Applications would be pre - screened and scored using the point system discussed previously. Once scored, the applications would be forwarded to the Fridley State Bank (FSB) for loan processing. FSB would notify the HRA of the eligible borrowers as each application is processed. Those who qualify for an MHFA loan, would receive a reduction in principal as outlined below: Loan Amount Percentage Reduction Less than $5,000 10% $5,001 to $10,000 12.5% $10,001 to $15,000 150 Maximum Maximum Number Assistance of Loans @ This Level $500 120 $1,250 48 $2,250 26 The actual savings to the borrower could even be greater due to the reduction in finance costs (assuming no pre - payment). The HRA assistance would be provided in the form of a grant; co- terminus with the MHFA loan. If the homeowner remains in the home, the HRA assistance would not have to be repaid. If on the other hand, the owner sells or refinances (at which time the MHFA loan would have to paid off) , the HRA grant would be repaid. The amount to be repaid would be in proportion to the outstanding balance on the MHFA loan. Assuming we receive HRA concurrence on the plan, we could offer the program at the same time we take applications for the CDBG program; hopefully some time in mid -June. The next step would be to formalize the procedures and finalize written details with FSB. 7.4 Memo to William Burns May 5, 1993 - Page 4 Fannie Mae Program On April 30, 1993 Grant met with Fay Wegner of Miller & Schroeder Financial, Inc. to discuss the Fannie Program. At the meeting Fay reviewed the program, various lender requirements, and an overview of the underwriting process. After discussing the specifics the HRA program, Fay indicated she would prepare a sample mortgage origination agreement for our attorney's review. The agreement would be used by the HRA and lender to outline the responsibilities of each party. One issue which has come up in subsequent discussions concerns whether certain improvements, such as a deck or fireplace could be financed under our program, assuming the improvements are a part of a larger project to upgrade the property. An example which came to mind was someone expanding a kitchen or family room which may include one of the improvements mentioned above. Although these items were previously declared ineligible, it would be important to know if these improvements would be allowed as part of the larger project. Unless otherwise directed, we will not allow these items as eligible expenses. Fay also stated that Norwest and United Mortgage expressed interest in participating in the program. Assuming the agreement is acceptable, we could probably have the program in place and ready for applications by late June or early July. HRA Reserve Fund As we discussed at our meeting on May 3rd, there are several concerns over this program. Potential candidates for this pool are identified below: Home Improvement Loan - Over income (more than $41,000) - Bad credit (late payments, a bankruptcy, unsatisfied judge- ments or liens). - High debt load - Home occupation which exceeds 15% of floor area. - Lack of equity in home. Home Improvement Grant - Over income based on guide- lines for family size. - Owner occupied triplex. or fourplex. - Home occupation which exceeds 15% of floor area. - Assets exceed $25,000 7.5 Memo to William Burns May 5, 1993 - Page 5 - Ineligible improvement /s There are also issues such as what happens when the property is purchased on a contract for deed and the vendor is unwilling to sign the mortgage or lien agreement; how do we determine feasibility of rehabbing a severely distressed or substandard property? We would like to leave program requirements for this fund flexible until we have a better idea of who may fall into this category after the first round of applications. MHFA Rental Rehab Loan Program As we discussed at our meeting on May 3rd, the same type of questions came up after evaluating the HRA's original plan to provide "gap" financing ". Since it is anticipated that only a small percentage of applicants would fall into a financing gap, the alternative would be to encourage more owners to improve their properties through an incentive -based approach. - The most workable solution appears to a principal reduction program similar to that proposed for the home improvement loan program. Any owner who would qualify for a loan through the program, could have the principal amount of their loan reduced by 100. The actual reduction would depend on the number of units in the building. The HRA assistance would be co- terminus with the loan; it would only have to be repaid in the event the owner sold the property prior paying off the MHFA loan. Again, the HRA assistance would be repaid in the proportion to balance outstanding on the MHFA loan. If the plan is acceptable to the HRA Board, we could approach Fridley State Bank and MHFA with the proposal. I would expect program implementation by early to mid June. M -93 -257 Projected No. MHFA Maximum Maximum of Loans @ Loan Amount Reduction this Amount Single -Unit $15,000 $1,500 73 Building Multi -Unit Lesser of $8,000 $4,000 27 Building per unit or $40,000 per bldg. The HRA assistance would be co- terminus with the loan; it would only have to be repaid in the event the owner sold the property prior paying off the MHFA loan. Again, the HRA assistance would be repaid in the proportion to balance outstanding on the MHFA loan. If the plan is acceptable to the HRA Board, we could approach Fridley State Bank and MHFA with the proposal. I would expect program implementation by early to mid June. M -93 -257 e� rn I �Z Al LLI ocr)i v� a w cc LL C N 7 O N O c0 69 U m 0 7 t m O N O O O N 49 O co 0 69 C H C Y co c 0 C C d a N O al N N O O N m v Y O O L m U C Y of V O Y O i+ m m U SD C 'O O N 'O N 3 Y m t U L U N c d a t U I m m t v v t 3 N w O N L LL c O r co CL O r N m m N N 0 C m t rn c Y m C O I M r M N N m a m C I� C Y CO c 0 N C 'N' U � I .- Y 3 a 0) F ............ 8.1 LAKE POINTE DEVELOPMENT MAINTENANCE PROJECT NO. 244 PROPOSAL FOR LAKE POINTE DEVELOPMENT MAINTENANCE PROJECT NO. 244 Proposal of: j ,$4pC.S0 J'S �Awt1 5 ibis . Ra 11 t� Street Address o � . 55 nflq City, State Zip . Code 9.1 To furnish and deliver all materials and to do and perform all work, in accordance with the cl, contract and specifications on file in the office of the Public Works Director and the "Special Provisions" contained herein for: LAKE POINTE DEVELOPMENT MAINTENANCE PROJECT NO. 244 (Mowing,-lawn fertilizing, . cleanup, etc., as spelled out in the specifications) ALTERNATE A Tree Pruning and Wrapping ALTERNATE B Tree Fertilization for Deciduous and. Conifers (Alternate B bid is based on () liquid () dry fertilizing) TOTAL BID (BASE BID + A + B) AL BID $ a3�-41 17 , _ $_3_5D $ 3.50-'-06 o? '7 . / I3. ° y (figures) 'nalred 7-71 rep CEO /I a-e5 E BID + A + B) WRITTEN IN WORDS P!A4 In r � J 10.1 Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley n TO: William Burns, Executive Director of HRA FROM:. Barbara.Dacy, Community Development Director SUBJECT: Follow -up on Taxes for HRA Property The HRA inquired about the increase in taxes for HRA -owned property in the southwest quadrant. I have attached the property tax state- ments for 1993. The values have remained the same for each property; however, the tax increase is as a result of the recent school referendum for School District #14. If you need further information, please let me know. BD:ls M -93 -258 IT OF PROPERTY TAXES PAYABI FRIDLEY H R A 6431 UNIVERSITY AVE NE FRIDLEY, MN 55432 - ------- ••---------------- -xxx[.....x +K�4.K..wT>i iXTtXKWITUIKiX)iJ02K1Lf EdWM M. Tnmk% Divisor Manager'10.2 COUNTY 2100 Std Avenue ,T _E IN 1993 Atmke, Mu 5eao3 323 -6400 PROPERTY DESCRIPTION li(. t THAT PRT OF LOTS 4 THRU 11 INC BLK 12 LOWELL ADD TO FRIDLEY PARK DESC AS FOL: KI-A 11y foss Property Class: New improvements COMM -IND N/A COMM-IND 0 Market Value: 114400 114400 1. Use this amount on Form M -1 PR to see if you are eligible for a property tax refund. File by August 15. It box is checked, you owe delinquent taxes and are not eligible . . ..... . ... . Q 0.00 2. Use this amount for the special property tax refund on schedule 1 of Form M -1PR . . . . . . . . . . . 0.00 YOUR PROPERTY TAX And How His Reduced By The State 3. Your property tax before reduction by state paid aids an credits . . . . . 7555.83 7699.03 -4 4. Aid paid by the State of Minnesota to reduce your property tax . . . . 3298.36 3264.77 5. Credits paid by the State of Minnesota to reduce your property tax: A. Homestead and agricultural credit . . . . . . . . . . . . . . . . . . 0.00 0.00 B. Agricultural Preserve Credit . . . . . . . . . . . . . . . . . . . 0.00 0.00 6. Your property tax after reduction by state paid credits . . --tF7- WHERE YOUR PROPERTY TAX DOLLARS GO 0.00 0.00 7. County . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8. City or town . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . 0.00 0.00 9. School district. . ..... . . . . . . . . . . .. . . . . 0.00 0.00 10.Special taxing districts . . . . . . . . . . . . . . . . . . . . . . . 0.00 0.00 10A. Tax Increment . . . . . . . . . . . . . . . . . . . . . . . . . 3093.88 2923.41 108. Fiscal Disparity Tax . . . . . . . . . . . . . . . . . . . 1163.59 1390.47 11.Voter approved Referenda Levies. . . . . . . . . . . . . . . 0.00 12.Total property taxes before special assessments . . . . . . . . . . 4257.47 4434.26 13.Special assessments added to this tax bill. . . . . . . . . . . . 0.00 0.00 14.Your total property tax and special assessments . . . . . . 4257.47 4434.26 15.Pay this amount no later than May 15, 1993 . . . . . . . . . . . 2217.13 16.Pay this amount' no later than October 15, 1993 . . . . . . . . . 2217.13 PLEASE INCLUDE PIN NUMBER ON CHECK PLEASE INCLUDE PIN NUMBER ON CHECK PIN: R14 30 24 32 0001 NA PIN:* R14 30 24 32 0001 NA ° MAM nos PAYASW Ta ANOKA COUNTY NNW CHEM PAYAeae To ANOKA COUNTY 21003rd Avenue. Anoka, MN 55303. 2100 3rd Avenue. Atmka. MN 55303 PAY T140S AMOUNT 2217.13 'PAY T10S AMOUNT 2217.13 FRIDLEY H R A 6431 UNIVERSITY AVE NE FRIDLEY, MN 55432 004994732000221713 FRIDLEY H R A 6431 UNIVERSITY AVE NE FRIDLEY, MN 55432 004994731000221713 00441473F000443426 •-------------------------------------------------------------------------- ANOKA COUNTY PAYABLE 1993 STATE PAID PROPERTY TAX REFUND INFORMATIO 1992 1993 Owner: FRIDLEY H R A PIN: R14 30 24 32 0001 6490 UNIVERSITY NE Market Value: 114400 114400 FRIDLEY, INN 55432 New Construction Value: N/A 0 Property class: Taxpayer: COMM -IND COMM -IND FRIDLEY H R A 6431 UNIVERSITY AVE NE FRIDLEY,MN 55432 line 1 Amount to use in filling out your property tax refund form M -1 PR, if eligible .......................................... 0.00 Line 2 Amount to use in fling out schedule 1 of form M -1PR, if eligible ........ 0.00 If this box Is checked, you owe delinquent taxes . . . . . .. . Q vatech rife slab and lrmdade It with your M- fps loan when applying fore reland ------- ------------------------------- L1RA PIN: R14 30 24 32 0001 1993 MKT/VAL PAY 1994 114,400 City: FRIDLEY Property Class: COMM -IND LOCAL BOARD OF REVIEW FRIDLEY H R A FRIDLEY CIVIC CENTER COUNTY ASSESSOR 323 5479 6490 UNIVERSITY NE APRIL 05,1993 AT 7:30 PM COUNTY BD. OF EQUALIZATION FRIDLEY, MN 55432 TO APPEAR CALL LOCAL ASSR. ANOKA COUNTY GOV. CENTER AT 571 3450 JUNE 17,1993 AT 9:00 AM nv017Ai --- Z2004M E wd M. Trask& Diaisien Munwmr. - - FRIDLEY HRA SYLVAN HILLS PLAT 7 6431 UNIV AVE NE LOT 1 FRIDLEY, MN 55432 BLOCK 1 Tt lLe Phu Property Class: New fmprovemenu Market Value: 1. Use this amount on Form M -1 PR to see 0 you are eligible for a property tax refund. File by August 15. If box is checked, you owe delinquent taxes and are not eligible . .. ..... . 2. Use this amount for the special property tax refund on schedule 1 of Four M -1 PR . . . YOUR _PROPERTY TAX And How tf fs Reduced The State 3. Your property tax before reduction by state pW alas and cr 4. Aid paid by the State of Minnesota to reduce your property tax . . . . . 5. Credits paid by the State of Minnesota to reduce your property tax: A. Homestead and agricultural credit . . ..... . B. Agricultural Preserve Credit . . . 6. Your property tax after reduction by state paid credits . . WHERE YOUR PROPERTY TAX DOLLARS GO 7. County • . . . . . . . . . . . . . . . . . . . . . . . . . . . 8. City or town . . . . . . . . . . . .. . . .. . . . . . . ...... . . . . . . . 9. School district . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.Special taxing districts . . . . . . . . . . . . 10A. Tax Increment . . . . . . . . . . . . . . . . . . . . . . 108. Fiscal Disparity Tax . ... . . . . . . . 11.Voter approved Referenda Levies.. . .... . . . . 12.Total property taxes before special assessments . . . . . . . . 13.Special assessments added to this tax bill. . . 14.Your total property tax and special assessments . IS.Pay this amount no later than May 15, 199.3 . . . . I B.Pay this amount no later than October 15. 1993 . . _ - - - � � _ ioa �lQj9i COMM -IND COMM -IND N/A 0 579600 579600 PLEASE INCLUDE FIN NUMBER ON CHECK PLEASE INCLUDE PIN NUMBER ON CHECK PIN' R14.30 24 32 0058 NA Pw: R14 30 24 32 0058 NA MAKE CHECKS PAYABLE TO: ANnKA (YU WrV PAY THIS AMOUW 15287.29 FRIDLEY HRA 6431 UNIV AVE NE FRIDLEY, MN 55432 005381902001528729 PAY THIS AMOUNT 15287.29 FRIDLEY HRA 6431 UNIV AVE NE FRIDLEY, MN 55432 005381901001528729 00538190F003057458 ---------------------------- -.-------------------------------------------------- ANOKA COUNTY PAYABLE 1993 STATE PAID PROPERTY TAX REFUND INFORMATION 1992 1893 Owner- FRIDLEY HRA PIN: R14 30 24 32 0058 06431 UNIVERSITY AVE NE Market Value: 579600 579600 FRIDLEY, MN 55432 New Construction Value: N/A 0 Property class: Taxpayer: COMM-IND COMM -IND FRIDLEY HRA 6431 UNIV AVE NE Line 1 Amount to use in filling out your property tax FRIDLEY,MN 55432 refund torn M -1 PR, if eligible .... 0.00 Line 2 Amount to use in filling out schedule t of torn M-1 PR, it eligible ........ 0_00 If this box is checked, you owe delinquent taxes . . . . . .. . Q aetear a& eh a and hWkIdo It w/th yow .. A&IM rmm When 0flWyhV lore iefuNd -------------- ---- - ---------------- - -°-- PIN: R14 30 24 32 0058 1993 MKT /VAL PAY 1994 579,600 Cgy. FRIDLEY LOCAL BOARD OF REVIEW FRIDLEY CIVIC CENTER APRIL 05,1993 AT 7:30 PM TO APPEAR CALL LOCAL ASSR. AT 571 3450 TIVOIZAi --- ZM507 Property Class: COUNTY ASSESSOR 323 5479 COUNTY BD. OF EQUALIZATION ANOKA COUNTY GOV. CENTER JUNE 17,1993 AT 9:00 AM COMM -IND FRIDLEY HRA 06431 UNIVERSITY AVE NE FRIDLEY, MN 55432 0.00 0.00 51678.80 53252.18 <- �'�-"' 22559.43 22677.60 0.00 0.00 0.00 - 29T19.37 0.00 - 3pS7g;38 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 21162.35 20310.38 7957.02 0.00 9654.29 - 29119.37 0.00 609-91< 30574.58 29119.37 0.00 30574.58 15287.29 15287.29 PLEASE INCLUDE FIN NUMBER ON CHECK PLEASE INCLUDE PIN NUMBER ON CHECK PIN' R14.30 24 32 0058 NA Pw: R14 30 24 32 0058 NA MAKE CHECKS PAYABLE TO: ANnKA (YU WrV PAY THIS AMOUW 15287.29 FRIDLEY HRA 6431 UNIV AVE NE FRIDLEY, MN 55432 005381902001528729 PAY THIS AMOUNT 15287.29 FRIDLEY HRA 6431 UNIV AVE NE FRIDLEY, MN 55432 005381901001528729 00538190F003057458 ---------------------------- -.-------------------------------------------------- ANOKA COUNTY PAYABLE 1993 STATE PAID PROPERTY TAX REFUND INFORMATION 1992 1893 Owner- FRIDLEY HRA PIN: R14 30 24 32 0058 06431 UNIVERSITY AVE NE Market Value: 579600 579600 FRIDLEY, MN 55432 New Construction Value: N/A 0 Property class: Taxpayer: COMM-IND COMM -IND FRIDLEY HRA 6431 UNIV AVE NE Line 1 Amount to use in filling out your property tax FRIDLEY,MN 55432 refund torn M -1 PR, if eligible .... 0.00 Line 2 Amount to use in filling out schedule t of torn M-1 PR, it eligible ........ 0_00 If this box is checked, you owe delinquent taxes . . . . . .. . Q aetear a& eh a and hWkIdo It w/th yow .. A&IM rmm When 0flWyhV lore iefuNd -------------- ---- - ---------------- - -°-- PIN: R14 30 24 32 0058 1993 MKT /VAL PAY 1994 579,600 Cgy. FRIDLEY LOCAL BOARD OF REVIEW FRIDLEY CIVIC CENTER APRIL 05,1993 AT 7:30 PM TO APPEAR CALL LOCAL ASSR. AT 571 3450 TIVOIZAi --- ZM507 Property Class: COUNTY ASSESSOR 323 5479 COUNTY BD. OF EQUALIZATION ANOKA COUNTY GOV. CENTER JUNE 17,1993 AT 9:00 AM COMM -IND FRIDLEY HRA 06431 UNIVERSITY AVE NE FRIDLEY, MN 55432 Edward M. Tresta. DlVamn Mm - - FRIDLEY CITY OF HRA SYLVAN HILLS PLAT 5 6431 UNIVERSITY AVE NE CITY OF FRIDLEY FRIDLEY, MN 55432 E 75.1 FT OF N 158 FT OF aProperty Class: Market Value: 1. Use this amount on Form- M -1PR to see If you are eligible for a property tax refund. File by August 15. If box is checked, you owe delinquent taxes and are not eligible . . . 2. Use this amount for the special property tax refund on schedule 1 of Form M- 1PR .. ............................... YOUR PROPERTY TAX And HowKLSReducedl3 7heState 3. Your property tax before reduction by state p and crectits 4. Aid paid by the State of Minnesota to reduce your property tax . . .. . . 5. Credits paid by the State of Minnesota to reduce your property tax. A. Homestead and agricultural credit . . . . . . .. ... . .. .. . . B. Agricultural Preserve Credit . . . . . . . . . . . . . . . . . . . . . 6. Your property tax after reduction by state paid credits .. . . .. . . WHERE YOUR PROPERTY TAX DOLLARS GO 8. City or town . . . . 9. School district. . 10.Special taxing districts . 10A. Tax Increment . . . . . . . . . . . . . . . . . . . . . . . . . . . 10B. Fiscal Disparity Tax . . . . . . . . . . . . . . . . . . . . . . . . I1.Voter approved Referenda Levies.. . . . .. .. . . . . .. . 12.Total property taxes before special assessments . . . . . . . . . . . 13.Special assessments added to this tax bill . . . . . . . . . . . 14.Your total property tax and special assessments . . . . . . . 15.Pay this amount no later than May 15, 1993 . . . . . . . . . . . - 16.Pay this amount no later than October 15, 1993 . . . . . . . . . PLEASE INCLUDE PIN NUMBER ON CHECK COMM -IND N/A 69200 0.00 4283.11 1869.71 0.00 0.00 0.00 0.00 0.00 0.00 1753.80 659.60 2413.40 2413.40 PLEASE WCLUDE PW NUMBER ON CHECK COMM- IND 0 69206 0.00 10.4 92" 4351.61 �-- 1843.26 0.00 0.00 -Z50H :-35 0.00 0.00 0.00 0.00 1651.38 784.15 72.82 2508.35 2508.35 1254.18 1254.17 Pm' R14 30 24 32 0051 NA PW: R14 30 24 32 0051 NA MAKE CHECKS PAYABLE To: ANOKA COUNTY MARE mars PATAB.E TO: ANOKA COUNTY 2100 3rd AvBwe. M*1 MN 55303 2100 3rd Avem9. AnOlck MN 54303 PAY THIS AMOUNT 1254.17 PAY nas AMOUNT 1254.16 FRIDLEY CITY OF HRA FRIDLEY CITY OF HRA 6431 UNIVERSITY AVE NE 6431 UNIVERSITY AVE HE FRIDLEY, MN 55432 FRIDLEY, MN 55432 005381272000125417 005381271000125418 00538127F000250835 h6- COUNTY PAYABLE 1993 STATE PAID PROPERTY TAX REFUND INFORMATION 1992 1993 Owner: FRIDLEY CITY OF HRA PIN: R14 30 24 32 0051 6401 UNIVERSITY AVE NE Market Value: 69200 69200 FRIDLEY, MN 55432 New Construction Value: N/A 0 Property class: Taxpayer: COMM-IND COMM -IND FRIDLEY CITY OF HRA 6431 UNIVERSITY AVE HE FRIDLEY,NN 55432 Line 1 Amount to use in fiTM out your property tax 0.0 0 refund form M-1 PR if eligible ........................ ................ 0.00 Line 2 Amount to use in filling out schedule / of form M -1 PR ii eligible ....... . If this box Is checked, you owe delinquent taxes ... .. . .. Q eared, me anm aad fadade ff with your A#4PR form when amlyhng for a refund ---------- ------------------------------ PIPEIR1tllLItifll13CE143R ,fAt<ittJiRy'�, f$ PIN: R14 30 24 32 0051 1993 MKT/VAL PAY 1994 69,200 irlihy FRIDLEY LOCAL BOARD OF REVIEW FRIDLEY CIVIC CENTER APRIL 05,1993 AT 7 :30 PM TO APPEAR CALL LOCAL ASSR. AT 571 3450 T1VOIZAI-- -Z3004805 Property Class: COUNTY ASSESSOR 323 5479 COUNTY BD. OF EQUALIZATION ANOKA COUNTY GOV. CENTER JUNE 17,1993 AT 9:00 AM Comm -IND FRIDLEY CITY OF HRA 6401 UNIVERSITY AVE HE FRIDLEY, MN 55432 J 1 1.1 Community Development Department PLANNING DIVISION City of Fridley DATE: April 28, 1993 TO: Jim Froehle FROM: (/Barbara Dacy SUBJECT: Summer Newsletter My staff has reviewed your list of proposed topics for the Summer Newsletter. To follow is a list of our suggestions. 1. HRA 1992 Annual Report. A. Feature on Grant Fernelius, new Housing Coordinator, including his picture. B. Brief update on housing programs; possible introduction of the "Fannie Mae" mortgage program. C. Feature on Sheet Metal Connector industry and site. D. Mississippi Street reconstruction. E. Update on McGlynn Bakeries' rehabilitation. F. Possible update on Northeast Quadrant redevelopment. 2. Curbside recycling reminder signs available through Lisa Campbell. Maybe we can get together on Wednesday, May 5, 1993 and work together on the articles. Thank you! BD /dn L m HealthPartners F00 April 28, 1993 Mr. William W. Burns City Manager Fridley Municipal Center 6431 University Avenue N.E. Fridley, MN 55432 Dear Mr. Bums: APR 3 0 190 HealthPartners 2829 University Avenue Southeast Minneapolis, Minnesota 55414 612 - 623 -8400 Thank you for sending us the information about the "Southwest Quadrant" site. We have clinics in Spring Lake Park, Arden Hills and Brooklyn Center. At this time, I do not feel a clinic in Fridley would be benificial for HealthPartners. We will keep the information on file for future reference. Director, Real /kmg The HealthPartners family of health plans includes Group Health and MedCenters. G12-334-33B2 CA SERL`r'MOLZAHNFL I NT 291 R01,-02 MRY 20193 14:47 iCasscrly M[olzahn & Associates, Inc, 216 South 11th Strut, Suite 300 • Minneapolis • Minnesota 55403 Oft(ae (612) 342 -2277 9 Fax (612) SPAS 3 3 4 - 3 3 8 2 FACSIMILE MESSAGE DATE May 20, 1993 PLEASE I)ELIVER THE FOLLOWING PAGES IMMEDIATELY_ TO Bill Burns & Barb DaCy LOCATION City of Fridl8y FAX NUMBER 571 -1287 NUMBER OF PAGES SENT (INCLUDING THIS PAGE) 2 FROM JAMES R AS ERLY TELEPHONE NUMBER 612 -342 -2279 FAX NUMBER 612-334-3382 IF YOU DO NOT RECEIVE ALL PAGES OR IF TH2RE IS A PROBLEM WITH THE TRANSMISSION, PLEASE CALL AS SOON AS POSSIBLE. OIL )04 JJaL 612- 334- 3382 � ASSERL''r'MOLZRHNFL I NT 291 P02, - -02 P`IPY 20'93 14:48 Gasserly Molzahn & Associates, Inc. 215 South 11th Street, Suite 300 • N' A'Is * Minnesota 55403 Office (612) 342 -2277 + Fax (612) 33-, ,:382 MEM RAND UM FROM: James R. Casserly Mary E. Molzahn DATE: May 19, 1993 RE: pending Tax Increment projects Ther, re a number of changes to the Tax Incremer t. A... < contained 3e File 427 passed by the Legislature last t'..-day night f , " 1993. some changes dealing with housing and poll, °.., H elpful or have the potential to be helpful; ' } � clhan- �. ping with limiting the use of developer payment ' a compen.s ity for its lost LGA /HACA are definitely detrimental. Most of tha- e changes will take effect for tax increment districts for which a request for certification is made to the county on or after August 1, 1993. If you have any projects in the planning stage which require the creation of a tax increment district within the next 18 months (by December 31, 1994), you should consider -os and cons of establishing the district prior to August 1, The Governor has not yet signed House File 427 but we are not aware of any problems and we are assuming it will become law. Please call us with any questions. Assuming House File 427 is signed, we will soon be sending you our 1993 Deskbook on tax increment. JRC,MEM /db HOUSING AND REDEVELOPMENT AUTHORITY MEETING 02.0 THURSDAY, MAY 14, 1993 7:30 P.M. PUBLIC COPY CITY OF FRIDLEY AGENDA 1 HOUSING & REDEVELOPMENT AUTHORITY MEETING THURSDAY, MAY 13, 1993, 7:30 P.M. Location: Council Chambers Fridley Municipal Center 6431 University Avenue N.E. CALL TO ORDER ROLL CALL APPROVAL OF MINUTES: April 8, 1993 ACTION ITEMS: CONSIDER SUBORDINATION AGREEMENT FOR SHEET METAL CONNECTORS 1. 1-1.15 CONSIDER RESOLUTION TO AUTHORIZE PARTICIPATION IN MHFA MINNESOTA CITY PARTICIPATION PROGRAM 2.1-2. 11 CONSIDER PROPOSAL FOR IMPROVEMENTS IN COOPERATION WITH MISSISSIPPI STREET IMPROVEMENT PROJECT 3.1-3.9 CONSIDER REVISED LEASEHOLD AGREEMENT FOR THE FRIDLEY PLAZA OFFICE BUILDING PARKING LOT 4. 1-4. 11 CONSIDER RESOLUTION DESIGNATING OFFICIAL DEPOSITORIES 5. 1-5.2 CLAIMS AND EXPENSES 6.1-6.3 INFORMATION ITEMS: STATUS OF HOUSING PROGRAM IMPLEMENTATION 7. 1-7.5 RICE PLAZA UPDATE 8.1 FOLLOW-UP ON LAKE POINTE BID INFORMATION 9. 1 FOLLOW-UP ON TAXES FOR HRA PROPERTY 10. 1-10.4 MEMO ON HRA ANNUAL REPORT FOR SUMMER NEWSLETTER . . . 11. 1 OTHER BUSINESS ADJOURNMENT E r 1 CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 CALL TO ORDER: Chairperson Commers called the April 8, 1993, Housing & Redevelopment Authority meeting to order at 7:30 p.m. ROLL CALL: Members Present: Larry Commers, Virginia Schnabel, John Meyer, Duane Prairie, Jim McFarland Members Absent: None Others Present: William Burns, City Manager Barbara Dacy, Community Development Director Rick Pribyl, Finance Director Craig Ellestad, Accountant Grant Fernelius, Housing Coordinator Appointee APPROVAL OF JANUARY 9, 1993, JOINT CITY COUNCIL/HRA MINUTES AND JANUARY 14, 1993, HOUSING & REDEVELOPMENT AUTHORITY MINUTES: MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the January 9, 1993, Joint City Council/HRA minutes and January 14, 1993, Housing & Redevelopment Authority minutes as written. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 1. CONSIDER APPOINTMENT FOR HOUSING COORDINATOR Ms. Dacy stated staff is recommending that the HRA appoint Mr. Fernelius as Housing Coordinator. Out of 77 candidates, five were interviewed and Mr. Fernelius was the top candidate. Mr. Fernelius stated he was honored to be considered a finalist. He looks forward to the opportunity to work with the HRA. MOTION by Mr. Prairie, seconded by Mr. Meyer, to accept the recommendation of staff to appoint Mr. Grant Fernelius as Housing Coordinator. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. Ms. Dacy stated a related item has come up which is a cooperative purchase agreement. Because the HRA has essentially hired an 4 HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 2 employee, this document is a joint powers agreement between the HRA and Anoka County so this employee can be put on the group insurance coverage similar to what the City now does for its current employees. Staff recommends the HRA approve the joint powers agreement and authorize the Executive Director and the Chairperson to sign the agreement. Mr. Meyer asked if this was ongoing for things other than insurance. Is there not something already in force? Ms. Dacy stated there is an agreement in force with the City but not the HRA as a separate entity. MOTION by Ms. Schnabel, seconded by Mr. McFarland, to recommend approval and to authorize the Executive Director and Chairperson to sign the joint powers agreement. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 2. AWARD BID FOR MAINTENANCE OF LAKE POINTE SITE Ms. Dacy stated bids were received for the Lake Pointe Development Maintenance Project No. 244 and the low bidder was Jon Isaacson Lawn Care with a bid of $24, 173.00. Mr. Commers asked if the company was bonded. Ms. Dacy stated, yes. They are bonded and must submit it to the Public Works Department. She believed the City had received this from the Jon Isaacson Lawn Care company. MOTION by Mr. Prairie, seconded by Mr. Meyer, to approve awarding the bid for the Lake Pointe Development Maintenance Project No. 244 to Jon Isaacson Lawn Care for $24, 173.00. Mr. Commers asked what was included in Alternates A and B. Ms. Dacy stated she was not sure and did not have the documents at this time. Mr. Prairie stated he would assume these were items that, if above budget, would not be done. Mr. Meyer asked if the deletion or acceptance of the alternates would change the low bidder. Ms. Dacy stated, no. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 3 3. CONSIDER APPROVAL OF SATISFACTION OF MORTGAGE FOR 5831 - 3RD STREET N.E. Mr. Commers stated the HRA is asked to approve the satisfaction of the Peterson mortgage, and the HRA has one other home on this program. Staff is recommending the HRA give the Executive Director authority to satisfy that mortgage when it comes due. Ms. Schnabel stated the satisfaction has already been done, and it looks as if the Petersons have lived up to the terms of the agreement. MOTION by Mr. Schnabel, seconded by Mr. Prairie, to endorse the mortgage satisfaction to Orlin and Darlene Peterson and to authorize the Executive Director to execute the remaining mortgage satisfaction when necessary as long as the program requirements are met. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 4. HRA BUDGETS FOR 1993 Ms. Dacy stated a copy of the 1993 budget was included in the agenda. Projects occurring in 1993 include: 1) the Mississippi Street reconstruction project; 2) Lake Pointe marketing; 3) housing programs; 4) University Avenue signal improvements; 5) Fridley Town Square and Dairy Queen issue; and 6) redevelopment of the southwest quadrant. Ms. Dacy referred to the Projection of Annual Accumulated Balance and stated staff has verified all revenue columns and expenditure columns. In 1995 and 1999, while there is a negative annual balance, the cumulative balance is positive. In 1995, the bond payment for Lake Pointe is due and in 1999 the final bond payment for another issue is due. Staff has estimated the revenue side very conservatively, assuming there is no new growth. For example, the tax increment from WalMart is not included. Ms. Dacy stated that in terms of operating expenses, given the initial focus on housing programs, staff has separated the budget into two budgets for better tracking. The HRA is right on budget for the housing coordinator fund. In the operating budget, staff is projecting approximately a 2% increase in the overall operating expenses. Because there will be a number of one-time expenses in 1993, some expenses will drop off in 1994. Ms. Dacy stated that at a previous meetings, the HRA wanted staff to analyze legal services and how much is being spent. The amount w: {tijf j itgi{t2{{S Ailp3tiA" tiummtAggizo.22bbli. f 3i21iiliigiktid3 ,888888 aa88$.;8>it»x :i:iiz i iii i;ia:i:i:i7 iakikit3t3k3i4$t3i32 Y3tiF3g8z,limiliziYsmags2stRs2sisa:f2AN;g2sin,ig i1Q{M:il***0-i HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 4 p spent is on budget for both legal firms, Barna, Guzy, and Casserly. Ms. Dacy stated that the HRA also asked staff to look at Rice Plaza. In 1992, they had a positive balance. However, in 1993, they can expect a negative balance because of the current tenant mix. Later this year, she recommends revisiting that issue and determining whether or not to proceed with demolition of the building. All leases will expire by the end of this year. Mr. Commers stated the tax increment projection is based without WalMart and Springbrook and is based on the current growth. Is there any appreciation on taxes included? Mr. Pribyl stated these are the numbers received for pay 1992 and inserted any increases that we know of in the next year. There is no appreciation of property for future years. Revenues are actual based on the agreements in existence today. Ms. Commers asked if interest earnings were calculated at 5%. Mr. Pribyl stated that was correct. That is 5% on the cumulative balance. Mr. Commers stated that the worksheet is good planning purposes, but the school district refunds should be footnoted that this is not an obligation. Mr. Pribyl stated this spread sheet is a planning device for the HRA and not a public document. Mr. Commers is correct in saying that at any point these can be discontinued. Mr. Commers stated that for planning purposes, this is good to include. Mr. Pribyl stated he would add a footnote. Mr. Burns stated this number has been considerably less when taking into account delinquencies. Mr. Pribyl stated, yes. It is dependant on the property. Mr. Commers asked if the 1992 refund was short. Mr. Pribyl stated they are actually still working on the last half of pay 1992. It is probably closer to the upper $200,000 figure. That amount includes Lake Pointe. Mr. Prairie asked if this is the one that was discussed by the Council. It might be good to put in the new numbers on the whole thing. HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 5 Mr. Pribyl stated these are projections and these will be updated. Next year, he will have the newest projection for 1993. All they can do is use the last actual figures for future projections. Mr. Burns stated staff does not have that information. The best they can do is provide 1990 and 1991 actual. Mr. Pribyl stated for 1992 it is something less than $100,000 but still between $50,000 and $100,000 but he did not know exactly what that figure is. Mr. Burns stated staff can provide projected actuals for the next meeting. Ms. Schnabel asked if they wanted actual as well as projected. Mr. Prairie stated that if the projection is off by 30%, he did not want it at this time. Mr. Pribyl stated it is only at this part of the fiscal year that staff can provide this to the HRA. In June and July, staff will get the "pay for 1993" and will be processing that for the next agreement period. It is still a guess because they do not know what the abatements and other tax petitions will be. Mr. Prairie stated he thought the school districts need it in May. Mr. Pribyl stated he can only give the most current numbers that are available. Mr. Commers stated the next issue relates to the salaries for the City and referred to the document on how much is spent on HRA time. Mr. Burns stated the City estimates the time allocated for the HRA and charges that percentage of salaries to the HRA. Each person is asked approximately how much time is spent for the HRA and that is the amount of time they include. Mr. Pribyl stated they are still using the same percentages used in the last two budgets. Mr. Prairie stated this is the equivalent of three full-time staff. Mr. Burns stated this seems correct. It was calculated before and he thought that is what they came up with. Mr. Prairie stated $168,000 is more than the previous year. Mr. Burns stated this reflects 3% increase over last year. HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 6 Ms. Schnabel asked if the Housing Coordinator position was included. Mr. Burns stated, no. Staff thought it best to keep track of that separately. Mr. Commers stated the legal fees seemed high. Ms. Dacy stated the budgeted amount is the same as last year and the year before. Ms. Dacy stated professional services includes more than attorney fees. Staff is recommending reserving $30,000 for Lake Pointe consultant services. In terms of attorney fees, Barna, Guzy are under budget and Casserly is within $2,000. Mr. Prairie stated fees were less last year. Ms. Dacy stated Casserly had a lot of time involved with Lake Pointe. Mr. Commers asked if staff anticipates any major projects at this time. Ms. Dacy stated the projects are included in the capital improvements section. Mr. Commers stated none of that takes legal services. Ms. Dacy stated this is correct. Mr. Prairie stated there is another $30,000 for Lake Pointe for a total of $60,000. Ms. Dacy stated $30,000 is for the consultant fee and $30,000 for advertising. Mr. Burns stated this is a best guess at this point. Mr. Commers stated it was his understanding that the City would do the rental inspections. Mr. Burns stated the budget includes rehab inspections. Ms. Dacy stated these are single family rehab programs which are separate from the rental unit inspections. Mr. Burns stated that when they start talking about the screening process, inspections will be discussed more. • • HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 7 Ms. Schnabel asked if the inspector is someone who will be hired to inspect for the HRA. Ms. Dacy stated these will be contracted services. Mr. Fernelius will be responsible for evaluating to see that they are qualified, and inspectors will be assigned to applicants who are receiving monies. He will have a pool of inspectors and will have contracts based on an hourly rate. Mr. Commers asked if it is necessary to have certification so, as government agencies approve property and they say it meets requirements, it is accepted. Ms. Dacy stated if property is inspected for MHFA the property may have different requirements. Staff is setting up minimum requirements for these inspectors. Staff has contacted communities with truth in sales ordinances and has a list of inspectors who work in these cities. Staff will contact these people to see if they are interested in providing service here. Mr. Commers referred to Rice Plaza. It seemed that for the condition of that Plaza and the income generated, the taxes should be abated. Ms. Dacy stated that as long as this is an income generating property, taxes will have to be paid. Mr. Commers stated he believed the taxes should be reduced significantly. What is the fair market value from the appraiser? Ms. Dacy stated taxes went up from 1992 because of class rate changes. She did not think the value was raised but there was a different method of calculating. Mr. Burns stated he also thought the taxes should have come down. Ms. Dacy stated that sometime in the future the HRA needs to decide whether to continue or get out. Mr. Commers stated the building does not have a great deal of value. The only value is the land value. As a result, it would seem that they could ask the County to significantly reduce the taxes. Mr. Pribyl stated they can file a request when paying the first half taxes. He can check and provide a report from the assessor. Mr. Prairie asked when the HRA needs to discuss what to do. It is not fair to the renters to wait until the last 60 to 90 days. Ms. Commers stated they should also look at what it will cost to demolish the building. {'v( ... -n.•.•..•• •-.•e-•- "+'•v' •.=S213iZt7WSNIWWH.Hay.Titireatkn•a.w•a................ HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 8 Ms. Dacy stated that about one year ago, an estimate for demolition was about $25,000. Staff is planning to schedule this discussion during June or July. Mr. Commers stated they don't have what all of the debt services are. Mr. Pribyl stated they have three different bond issues that are still outstanding. There is no other long term debt. Mr. Commers stated that based on the analysis, if they assume these numbers are accurate, what is available for development between now until the year 2000. Mr. Pribyl stated that if the HRA does nothing now until the year 2000, they would have accumulated a balance of $4.4 million. If funds are used, the cumulative balance would be less because less interest would be earned. Mr. Commers asked, out of this amount, what is the accumulated interest? Mr. Pribyl stated there is a significant amount of interest, perhaps $2 . 5 million to $3 million. Mr. Commers stated that if they use funds, they have only $1 million. What happens on Lake Pointe if they want to put $4 million into it? Mr. Pribyl stated they have a cumulative balance that will carry the 1995 debt service payment. There is a huge incentive at Lake Pointe which is the land value. Mr. Burns stated the incentives are the land writedown and the parking ramp. They need intensive development to warrant a parking ramp. Mr. Commers stated there is no balance sheet to show the HRA what they have. Mr. Pribyl stated he is working on it now. He does not have it for 1992 . What the Commission is seeing in the cumulative balance is what the balance actually is. This is the cash position but not the property that is owned. Mr. Commers stated this is not as good as it should be. Mr. Pribyl stated that with the situations at Lake Pointe and the City Center, they have still kept cumulative balance. ____....,......,..,axvoaa:titctiNaitLiiiiit ++z�vt pan,nzuaax ..wu...ao+.u.-.vr..o<acx, - nrczswutwra::iw • HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 9 Mr. Commers stated that the HRA will have to be much more careful and be sure projects will break even. Mr. Pribyl stated that with Lake Pointe, he thought the land incentive is attractive if they get a developer that can handle that size of property. Mr. Commers stated that assuming that takes place, that is a balance sheet item and will have no effect on the budget. Mr. Burns stated that in terms of economic development items, it is going to orient them to a pay-as-you-go approach for economic development projects that arise. Mr. Commers asked how pay-as-you-go affects this. Mr. Pribyl stated it does in that they have income on the tax increment side and expenses going out. Mr. Burns stated you cannot pay out more than what you are getting. If the increment is not there, you don't pay. At a minimum, they get the 10% administrative fee up front. Mr. Pribyl stated ordinarily it would positively impact that statement. Mr. Commers asked what made up the rental income. Ms. Dacy stated they received rental revenue from Fridley Liquor Warehouse, Fridley Plaza Office parking lot, Dairy Queen, the oil changing facility, and Rice Plaza. The worksheet assumes no income from Rice Plaza in 1994; and, as of 1997, the southwest quadrant would be redeveloped. The Fridley Office Plaza parking lot rent is for 30 years. Mr. Commers asked, other than Rice Plaza properties, are there any other associated maintenance expenses? Ms. Dacy stated there is parking lot maintenance for the Plaza Office building, but rent exceeds costs. There are no direct charges to the HRA on that in the last year or two. Owners have said they would like to talk to us about a schedule for seal coating and striping. The project is about eight years old and is showing wear. Rental income will cover maintenance expenses for that lot. Ms. Dacy stated that because of the housing issues, staff could not do the budget earlier but will try to go through this discussion for 1994 in November or December. For clarification of the utility services #4338, Lake Pointe has an irrigation system and she received a late bill from the utility department for 1992. f ., _0.1,0,50,,sw,.?5)05 ..,>.,,.iibbi,hh: 5A1>i i 5,1) • HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 10 Budgeted was $3,000 and she would like the HRA to allocate an additional $3,400 to cover the existing expenses for the water bill. The total should be $6,400. Mr. Commers asked if trees would be replaced in the plaza. Ms. Dacy stated that nothing has been done with the tree replacement project for two years. Two years ago, several locust trees were removed and budgeted for replacement but staff did not move on it. This is to bring it to the Commission's attention and the HRA can eliminate it or direct staff to do the project. Mr. Commers asked what is done on litigation settlements. There is another potential $40,000 for the Dairy Queen. Ms. Dacy stated that number represents that Fitch to date has been awarded $125, 000 and this reflects the remaining funds. MOTION by Mr. McFarland, seconded by Mr. Prairie, to approve the budget as presented with the amendment to #4338 for a total of $6,400 for utility services (water) . UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 5. CLAIMS AND EXPENSES Mr. Pribyl stated there are some additions to the check register. Mr. Ellestad stated it is difficult to present a complete register because of when the meetings are scheduled so he will present additions. These are #2307 to Steve and Paul Barnacle for February and March snow plowing in the amount of $230.00. There are two checks #2305 which will be combined and go out in one check. The next is to First Choice for $446.98 for a modem for Mr. Casserly. Mr. Commers stated he thought that should be his expense. It should be his responsibility to provide for the needs of his clients. Mr. Burns stated they tried to work with his equipment and his equipment did not work. He thought this would reduce legal fees. Mr. Ellestad stated the next is to American Express for $94.00 for lunches to discuss Lake Pointe; Casserly Law offices for $2,273.50 March legal services, and Kordiak Company for $135.99 for the March management fee. MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the claims and expenses as amended. HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 11 UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMERS DECLARED THE MOTION CARRIED. 6. ADDITIONAL FINANCING FOR FRIDLEY TOWN SOUARE Mr. Commers asked if Mr. Burns had any meetings with Mr. Wagner. Mr. Burns stated he has not met with Mr. Wagner personally. Mr. Casserly has met with them. He talked with Lowell Wagner over the phone and reiterated his position. Mr. Fitch has asked for a $35, 000 additional settlement on the Dairy Queen. Staff believes the HRA should stay with the original proposal. This is to update the Commissioners unless the HRA decides otherwise. Mr. Meyer asked if the option was to face the possibility of taking legal action. Mr. Burns stated Mr. Fitch has filed an appeal and it could be that he will follow it through the court system. It could cost additional money. Mr. Commers stated three independent appraisers have made an assessment of value. When these people testify that this is the value, it will be very hard to overcome that. Usually the court will put the greatest weight on what these people say. He has moving benefits also and an allowance for fixtures. 7. REVIEW SCREENING PROCESS FOR REHAB LOAN APPLICATIONS Ms. Dacy stated what staff heard at the joint meeting was that the HRA wants to pursue a pre-screening method. She talked to the Minneapolis Community Development Association (MCDA) , City of St. Paul and some of the bankers to see what they want in terms of an application. Staff talked to Mr. Gene Malis who has helped set up some rehab programs. Ms. Dacy stated she has tried to set up an application review schedule with a rating schedule to score applicants. The potential time frames are to start advertising in May, 1993, and establish the application window to send out application and receive them back allowing approximately 30-45 days. They would close applications, then have two weeks where the Housing Coordinator would look at the applications and sort by income for CDBG, MHFA, etc. Using a rating system, the Housing Coordinator would go through and score the applications that could be funded. If they get a flood of applications, they may have to tell some applicants that the HRA cannot fund their application. If that happens, once the first set of applications gets up and running, they could open another window in August. Potentially, depending on the response and funding, they could possibly have four opportunities for ..-••-•-•- •-., -'. ..t;.,,:. i x•4`•xv i2itiai;;;a:ni:i x ......,.2:1i>:wcux+aaxx.a.auc....es.,..........................,.....�_ _. HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 12 residents to apply for these programs. She thought the City would get a lot of response and thought funds would go fast. Ms. Dacy stated that in terms of the rating system, they started with a list of 15 criteria and then set priorities according to the HRA and Council recommendations. The rating will be according to age of home, income, a priority list of homes, and the value of code-related work. When the Council reviewed this, they liked the system, but asked the HRA to use how long an owner has lived in the community as a tiebreaker if necessary. Ms. Dacy stated staff also developed a potential application form. The first page is basic information about who the owner is and the type of dwelling. No application will be approved if there is illegal activity at the home. At the bottom is a list of code- related work which will help in reviewing applications. The last page is to get preliminary information as to the range of debt and range of income. They are asking for a copy of 1040 or 1040A to verify income. After the grant goes through and they determine who will be receiving money, the next step is to call a rehab inspector to look at the building, see if the work to be done is okay and if there is any other work that needs to be done. The inspector will review the results with the Housing Coordinator and implement the program from there. Ms. Schnabel asked if the questions on the application are in keeping with questions that are needed for the CDBG or the other programs that are potential funding for these projects. Ms. Dacy stated the financial information is more for the loan programs. The banks and administrative programs will need this information up front before creating loans. This is probably asking for more than is needed for CDBG, but staff is trying to create one all purpose form. Ms. Schnabel asked if marital status is necessary information. Ms. Dacy stated it is necessary for refinancing debt. They want to see if there are agreements for child support or other issues like alimony. Mr. Meyer asked what procedure will be used to advertise the program and the dates. Ms. Dacy stated that, first, a direct mail approach will be used to contact people on the priority list. Staff will develop a brochure and let them know these programs are available. Second, an ad in the Focus or an article on the programs will be printed. Staff has budgeted for the program up to eight 1/4 page ads. Further, she wants to crosstrain all inspectors to be aware that these programs are available and ask people to call. HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 11 UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED. 6. ADDITIONAL FINANCING FOR FRIDLEY TOWN SQUARE Mr. Commers asked if Mr. Burns had any meetings with Mr. Wagner. Mr. Burns stated he has not met with Mr. Wagner personally. Mr. Casserly has met with them. He talked with Lowell Wagner over the phone and reiterated his position. Mr. Fitch has asked for a $35, 000 additional settlement on the Dairy Queen. Staff believes the HRA should stay with the original proposal. This is to update the Commissioners unless the HRA decides otherwise. Mr. Meyer asked if the option was to face the possibility of taking legal action. Mr. Burns stated Mr. Fitch has filed an appeal and it could be that he will follow it through the court system. It could cost additional money. Mr. Commers stated three independent appraisers have made an assessment of value. When these people testify that this is the value, it will be very hard to overcome that. Usually the court will put the greatest weight on what these people say. He has moving benefits also and an allowance for fixtures. 7. REVIEW SCREENING PROCESS FOR REHAB LOAN APPLICATIONS Ms. Dacy stated what staff heard at the joint meeting was that the HRA wants to pursue a pre-screening method. She talked to the Minneapolis Community Development Association (MCDA) , City of St. Paul and some of the bankers to see what they want in terms of an application. Staff talked to Mr. Gene Malis who has helped set up some rehab programs. Ms. Dacy stated she has tried to set up an application review schedule with a rating schedule to score applicants. The potential time frames are to start advertising in May, 1993, and establish the application window to send out application and receive them back allowing approximately 30-45 days. They would close applications, then have two weeks where the Housing Coordinator would look at the applications and sort by income for CDBG, MHFA, etc. Using a rating system, the Housing Coordinator would go through and score the applications that could be funded. If they get a flood of applications, they may have to tell some applicants that the HRA cannot fund their application. If that happens, once the first set of applications gets up and running, they could open another window in August. Potentially, depending on the response and funding, they could possibly have four opportunities for HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 12 residents to apply for these programs. She thought the City would get a lot of response and thought funds would go fast. Ms. Dacy stated that in terms of the rating system, they started with a list of 15 criteria and then set priorities according to the HRA and Council recommendations. The rating will be according to age of home, income, a priority list of homes, and the value of code-related work. When the Council reviewed this, they liked the system, but asked the HRA to use how long an owner has lived in the community as a tiebreaker if necessary. Ms. Dacy stated staff also developed a potential application form. The first page is basic information about who the owner is and the type of dwelling. No application will be approved if there is illegal activity at the home. At the bottom is a list of code- related work which will help in reviewing applications. The last page is to get preliminary information as to the range of debt and range of income. They are asking for a copy of 1040 or 1040A to verify income. After the grant goes through and they determine who will be receiving money, the next step is to call a rehab inspector to look at the building, see if the work to be done is okay and if there is any other work that needs to be done. The inspector will review the results with the Housing Coordinator and implement the program from there. Ms. Schnabel asked if the questions on the application are in keeping with questions that are needed for the CDBG or the other programs that are potential funding for these projects. Ms. Dacy stated the financial information is more for the loan programs. The banks and administrative programs will need this information up front ise fore creating forl CDBGoans. This but staff iss try ngbto ly asking for more than create one all purpose form. Ms. Schnabel asked if marital status is necessary information. Ms. Dacy stated it is necessary for refinancing debt. They want to see if there are agreements for child support or other issues like alimony. Mr. Meyer asked what procedure will be used to advertise the program and the dates. Ms. Dacy stated that, first, a direct mail approach will be used to contact people on the priority list. Staff will develop a brochure and let them know these programs are available. rend, an ad in the Focus or an article on the programs will be pa e ted. Staff has budgeted for the program up to eight 1/4 p g Further, she wants to crosstrain all ask people to call. inspectors be aware that these programs are available HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 13 4 Mr. Meyer asked when the City Newsletter comes out. Ms. Dacy stated the newsletter comes out four times per year. This probably will not give them the best timing, but she can put in some information about the programs. Last year the HRA used the newsletter for their annual report. She has received about 15 calls from the article in the winter edition. Mr. Meyer stated he thought this sounded very good. The tie breaker seems somewhat academic, but an applicant can be picked up the next time a program is offered. Ms. Dacy stated this could depend on the number of applicants. There may be just one window depending on the number of applications. Mr. Meyer stated a person may be waiting regardless. If the Council feels the applicants should not be on a first-come, first- serve basis, then they can use length of residence. Mr. Commers stated he had no preference. Do whatever is fair. Ms. Schnabel stated she had a problem with page 7.7. She did not know how widespread this information goes but she thought the information should be confidential. Ms. Schnabel asked that on the priority list, did staff think anyone might be offended if they are on a list like this? Ms. Dacy stated that while she cannot control their reaction, the sites are in need of work. Perhaps the program is better served if they identify specific addresses. The Council and HRA wanted to revisit the programs every six months. She was concerned that many people would end up being missed and not have property included that the City wanted included. Mr. Commers stated they need to get started. If something comes up, it can be discussed and adjustments made as necessary. 8. DESCRIBE FUTURE MARKETING ACTIVITIES FOR LAKE POINTE AND SOUTHWEST QUADRANT Mr. Burns stated he is recommending a meeting with the HRA and City Council on May 8th. In January, Mr. Commers, the Mayor, Mr. Casserly, Ms. Dacy, and he talked about marketing Lake Pointe. Staff talked to Jim Winkels to identify a list of realtors to market the site and then interviewed them. He believed they all agree that this is an attractive site but at the same time they think the original vision will be difficult to accomplish. There is no market for office space and a worse market for hotel/ . _ - .. .. - ...tit..z.:.,>... ,.. ...a.>...._,.,..�.,........ HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 14 F conference center space. A more real focus would be high tech office building for manufacturing and office space. The other thing is that they are probably going to focus on the metro area because of the tax climate and adverse business factors. Mr. Burns stated the group talked about the name but the majority thought it should be called the Lake Pointe Business Center. Mr. Burns stated another suggestion was that they not spend as much on marketing but spend money for a monument at the site entrance. A market brochure needs to be prepared that can be sent to prospective clients. A number of decisions need to be made about uses and timing for those uses. The tax increment district expires in the year 2009. Do they want to try to attract uses in two to three years or wait five to ten years? Uses and timing are two very important things. They also need to focus on how to market. He is leaning toward a broker approach because of the limitations of staff. When talking about a real estate broker approach, some provide only a broker service. Others are also developers and builders. They can also use a developer approach. It is too early to rule that uto erhaps con ider the market is not not doing anythingght for for several lyears. and they may wantt Mr. Burns stated he is recommending hiring Bill Tobin to organize a strategic planning session and to meet with the HRA and Council on May 8 for a fee of $2,000. Mr. Tobin was brought to his attention by Mr. Winkels. Mr. Tobin has worked with Medtronic. He is interested in being a consultant. He thought Mr. Tobin would serve the City well, and he would be very helpful in wording and designing an RFP and helping to evaluate responses. He stated he would like to move ahead as quickly as possible. Mr. Commers asked if Mr. Tobin would do the meeting, planning, and report for $2,000 and after that he would be on an hourly basis. Mr. Burns stated, yes. He is willing to go on a fee per project if the City needs that. Mr. Meyer stated it would be nice to get together on May 8 but it seems the things to be discussed and things the HRA is being asked for decisions on are things he does not know much about. He thought these are things that Mr. Tobin should tell us. The HRA needs someone who will tell the HRA what they will be faced with or what approach to use in marketing. Mr. Burns stated it is important to know that the City Council and HRA are buying into a particular set of guidelines. A quality development on this site is a priority. Mr. Tobin is in a good position to steer them in the right direction for the uses the HRA might identify and to help bring them to a consensus. • HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 15 • Mr. Prairie stated that if they want to develop at the level they want, they may have to wait seven or eight years. Mr. Meyer stated he wants the expert's guidance as opposed to guiding the expert. Mr. Comers asked if he wanted alternatives. Mr. Meyer stated he wants to be told the facts of what is out there and what is realistic. He wants to hear his expertise. • Mr. Burns stated he has not yet structured the meeting. He can structure it so the HRA can hear the types of things Mr. Tobin feels they can do now and do two or three years out. Mr. Meyer stated to inform us of what is out there is important. Mr. Prairie asked if Mr. Tobin could present what would happen if the HRA waited two years or five years and the consequences. Ms. Schnabel asked if there are people in the corporate development center. Mr. Burns stated the biggest tenant is a company called Multi-Tech. Ms. Schnabel asked if it would be of some value to get someone who is involved in that development to talk to the HRA to find out how they proceeded, or has Mr. Burns talked to them? Mr. Burns stated he has talked to them. Ms. Schnabel asked if they want someone geared to a suburban area as opposed to downtown. Mr. Burns stated that if they start focusing on a person who has developed a particular parcel or who is currently developing, they will hear a sales pitch as opposed to a person who is objective about it. That is the kind of person I have tried to bring to you. This individual has demonstrated strong knowledge of real estate. Mr. Commers stated he thought this was a good start. They may raise even more questions and may need to do something else. It would be a good idea if he did have some things in mind as to what would be viable choices. Ms. Schnabel asked what about the southwest quadrant. Mr. Burns stated they have not talked about this. In conversations with one broker, he recommended the City try to attract a medical project such as a clinic. He thought Lake Pointe took priority. HOUSING &REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 16 • Mr.prefer Meyer m e to 11 a.m.if the meeting 9 a.m.needed to 12 noon. Then everyone three hours. He ould has prefer the afternoon free. Mr. Burns stated he can make it earlier. He would recommend that this be considered an HRA meeting rather than a Council meeting. He will tentatively assume the meeting is May 8 from 9 a.m. to 12 noon. 9. HOME PROGRAM Ms. Dacy stated she is requesting the Commission concur with the recommendation that, if necessary, the local match would come out of reserves that have been identified. She will find out more at a later point in time. The Commission concurred. 10. RICE PLAZA UPDATE Mr. Commers stated they had talked about and have the March rental information. This is for the Commission's information. 11. MISSISSIPPI STREET IMPROVEMENT PROJECT Ms. Dacy stated that as part of the Mississippi Street improvement, she has requested the contractor park their trailer behind Rice Plaza and access by 3rd Street. Ms. Dacy is requesting the HRA pass a motion for the County to make a minor modification to save a 100-year-old oak tree next to the Target property on Mississippi Street. This is a double trunk tree and she is asking the public works department to route the sidewalk around the tree rather than remove it. Siah St. Clair has looked at the tree and stated this is a white oak which is very hardy. There will be a two-foot grade cut and with the sidewalk rerouted, he is confident the tree will survive. These trees have a life expectancy of 300-500 years. Mr. Commers asked why not do the sidewalk on the side away from the curb. Ms. Dacy stated they could do it that way also. There is another oak tree in the median and the sidewalk would have to be routed in between the two trees. Mr. Prairie asked if there were any safety concerns. Ms. Dacy stated it is better to have the sidewalk separated from the curb but there are instances where sidewalks butt up against the curb. ti HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 17 Mr. Commers asked if there would be extra cost. Ms. Dacy stated she thought it would even out. They would have to build a two foot retaining wall which would even out with the cost of brick. MOTION by Mr. McFarland, seconded by Ms. Schnabel, to recommend rerouting the sidewalk to save the white oak tree. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 12. OTHER BUSINESS Mr. Burns stated there are signs the industrial sector of the. economy is improving. He has been getting contacts at the City. This is on behalf of the All-Temp Corporation located on Ninth Street just north of Kurt Manufacturing. They sent a letter describing a 50,000 square foot addition they would like to build on to their building, but they have some problems building it in Fridley as far as sprinkler systems in refrigerated space. They also have to provide for storm water detention and that is difficult with the lack of storm drains on Main Street. They will still have to provide for storm detention, but next year the County is planning to install a storm drain line so that will help. They do have a customer in Monticello that needs the frozen storage, and this customer and the City of Monticello is offering financial incentives to build a facility there. They are asking how they can solve these problems and asking what financial incentives Fridley may have. Mr. Burns stated Mr. Holman represents two companies - All-Temp Distribution and All-Data Storage. The two companies employ 53 people. They occupy 425, 000 square feet next to Kurt Manufacturing. One-third of the building is leased to American Converters and Land O'Lakes. All-Temp provides food distribution services for a number of frozen food producers. All-Temp has annual sales of $3.5 million and All-Data, a records storage business, has $1. 0 million in sales. The project is a 50,000 square foot facility to be built to serve two prospective customers. Estimated cost is $3. 0 million with an expected tax value of $20 per square foot. They plan to hire 15 to 20 new employees with an average salary of $28, 000. They hope to begin construction in 1993. There is the potential of another client requiring 10, 000 to 15, 000 square feet and, if that happens, they will have to go somewhere else. They also need a rail site. Mr. Burns stated he has asked Mr. Casserly to review the The project can legally be funded through TIF and an Economic Development Tax Increment District could be created. If they 1 HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 18 Pguideline, I accept $3 million as the project costs and apply the 5% they could provide up to $150,000 as a grant incentive or a pay- as-you-go incentive. Alternatively, Mr. Casserly suggests considering a combination loan and revenue note package. Mr. Burns stated there are issues other than space. The site is tight and Kurt uses the property for parking. If All-Temp is to build, Kurt would not have use of the property and Kurt is at maximum lot coverage. There are some density problems for Kurt. They are looking at a site across from Holiday Plus. Mr. Prairie asked why not go ahead with it. Mr. Burns stated he did not see anything wrong. He recommended going ahead, but he did not want to go with a grant. He has not given an opportunity to Mr. Casserly to present his idea. Mr. Commers stated he agreed with the concept to go ahead and see where it goes. Mr. Burns stated this is a distribution business rather than a manufacturing business but it is a worthwhile enterprise and it is worthwhile to support an existing industry. Mr. Commers stated to go forward and see what can be done. Mr. Meyer asked that regarding the sprinkler system, is it the City that must approve? Mr. Burns stated it is the State Building Code which the City interprets as requiring a sprinkler system. Mr. Burns stated the building is very cold and it is very expensive to install a sprinkler system. Ms. Dacy stated they can get an opinion. ADJOURNMENT MOTION by Ms. Schnabel, seconded by Mr. McFarland, to adjourn the meeting. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON 3, HOUSINGCOMERS REDEVELOPMENT EDTHE MOTION CARRIED AND THE APRIL 8, AUTHORITY MEETING ADJOURNED AT 10:10 P.M. Res ectfully submitted, Lavonn Cooper Recording Secret 1.1 flL 1 Community Development Department HOUSING AND p REDEVELOPMENT AUTHORITY City of Fridley DATE: May 6, 1993 TO: William Burns, Executive Director of HRA ,1 4f a FROM: Barbara Dacy, Community Development Director SUBJECT: Consideration of Subordination Agreements for Sheet Metal Connectors Sheet Metal Connectors is about to complete the SBA loan process for permanent financing of its new building on Main Street. The financing structure for a SBA loan includes a bank loan secured for at least 50% of the total project costs, the SBA loan constitutes 40% of the project costs, and the owner's equity constitutes the remaining 10% of the project costs. The HRA's assistance took the form of a $200,000 loan and was subordinated to the construction financing placed by Northeast State Bank. At this time, the permanent financing must be obtained in order to take out the construction financing; therefore, the HRA's assistance must take a third position to the bank loan and the SBA loan. Michael Hurley, attorney for Northeast State Bank, has submitted a synopsis of the project loans and loan amounts. He has also prepared two subordination agreements for consideration and execution by the HRA. The HRA mortgage will be subordinated to the Northeast State Bank loan and the SBA loan from the Coon Rapids Development Company. We have asked Jim Casserly to review the documents, and he has advised us that they are in proper form and in compliance with the Development Agreement. Further, the $200,000 loan was secured by a personal guarantee from Jerome Myers. This proposal is similar to the HRA's assistance in the Advance Company's project on Central Avenue. In that case, Mr. Kitterman also obtained SBA financing. Recommendation Staff recommends that the HRA approve the attached subordination agreements and authorize execution by the HRA Chairperson and the Executive Director. BD:ls M-93-253 HDS INC. !#821 P02 __. _ MAY-06-'N93 THU 10:5? ID-BDS INC. TEL NO 786-9034 li 1.2 • 1 f kiiwe pROJEcT FINANCING The following is a listing of the uses and sources of funds for the building construction project in Fridley: USES OF FUNDS , 175,000 Land � 139,0,112 139 Building Construction 2, �4 Contingencies/Soft Costs - $2,414,112 SUBTOTAL _�� Plus: SBA Debenture Pricing - TOTAL USES OF FUNDS SialLail SOURCES OF FUNDS Bank $ 786,112 SBA (Including Debenture Pricing) 750,000 of FridleyHRA Cxty - 200,000 Owners' Equity _lig1.0114 TOTAL SOURCES OF FUNDS 2.06.112 • ROBERT A.GUZY BERNARD E.STEFFEN 1.3 SHARON L.HALL RICHARD A.MERRILLBGS VIRGIL C.HERRICK ROBERT C.HYNES HERMAN L.TALLE RICHARD A.BEENS PAMELA M.HARRIS DARRELL A.JENSEN CHARLES M.SEYKORA JEFFREY S.JOHNSON Barna, Guzy & Steffen, Ltd. RUSSELL H.CROWDER WILLIAM M.HANSEN JON P.ERICKSON DANIEL D.CANTER,]R. Al I ORNEYS AT LAW BEVERLY K.DODGE LAWRENCE R.JOHNSON GREGG V.HERRICK DAVID A.COSSI 400 Northtown Financial Plaza JAMES D.HOEFT MTHOMAS P.MALONE 200 Coon Rapids Boulevard JOAN scan-M LEPDAK MICHAEL F.HURLEY Minneapolis,MN 55433 STEVEN L.MACKEY (612)780-8500 FAX(612) 780-1777 May 4, 1993 Ms. Barb Dacy Fridley HRA 6431 University Ave Ne Fridley, MN 55432 RE: Sheet Metal Connectors / Jerome Myers / MSCJ, Inc. Dear Ms. Dacy: I have been requested by Mr. Jerome Myers sole shareholder of Sheet Metal Connectors ("Sheet Metal") and MSCJ, Inc. ("MSCJ") to outline the steps he is taking to refinance the existing debt against the facility his company has constructed at 5850 Main Street NE, Fridley, MN ("Project") . i represent Northeast State Bank, the construction and takeout lender on this project. Northeast State Bank lent Sheet Metal 1.4 million dollars in August of 1992 by and through a line of credit for the purpose of constructing a building on the Project. The HRA gave a $200,000 loan to MSCJ for the purpose of land acquisition and construction of the Project. To secure payment of the $200,000 note, the HRA took a mortgage against the Project and a personal guaranty of Mr. Myers. Currently, the Project has a first mortgage against it in the original amount of 1.4 million dollars in favor of Northeast State Bank and a second mortgage against it in the amount of $200,000 in favor of the Fridley HRA. The outstanding principal balance on the line of credit secured by the first mortgage in favor of Northeast State Bank is $728, 000.00. Sheet Metal and MSCJ are in the process of obtaining permanent financing for the Project. Sheet Metal has applied for a $750, 000 loan from the Small Business Administration ("SBA") under a SBA 504 loan program. Northeast State Bank has agreed to provide financing for the Project in the amount of $872,000. Northeast State Bank and the SBA have requested that the $200,000 second mortgage from the Fridley HRA be subordinated to the new debt. The SBA will close on this transaction, issue debentures and fund the note in July of 1993. At closing, Northeast State Bank will leave the existing first mortgage in place. A second An Equal Opportunity Employer 1.4 May 4, 1993 Page 2 mortgage will be placed on record in favor of Northeast State Bank in the amount of $872,000. A third mortgage in favor of the SBA will be placed of record in the amount of $750,000. As I indicated above, the current outstanding principal balance of the first mortgage in favor of Northeast State Bank is $728,000. Northeast State Bank has agreed not to extend any further credit under the first mortgage and agrees that the $728,000 will remain in place until the SBA debentures are sold and the note funded. The SBA will use the $750,000 from the sale of the debenture to pay in full the first mortgage held by Northeast State Bank. At that time, Northeast . State Bank will satisfy their first mortgage. After satisfaction of the first mortgage, the Project will be encumbered by a first mortgage in favor of Northeast State Bank in the amount of $872,000, a second mortgage in favor of the SBA in the amount of $750,000 and a third mortgage in favor of the Fridley HRA in the amount of $200, 000. In order to accomplish the above referenced transaction, Sheet Metal, MSCJ and Mr. Myers are requesting that the Fridley HRA subordinate its $200, 000 mortgage to the first mortgage now held by Northeast State in the amount of 1.4 million, the second mortgage to be placed of record in favor of Northeast State Bank in the amount of $872, 000 and a third mortgage to be placed of record in favor of the SBA in the amount of $750, 000. Again, after the SBA debenture is sold and the note funded, the proceeds will be used to pay off the existing first mortgage in favor of Northeast State Bank with a current outstanding principal balance of approximately $728,000. At that time, the first mortgage will be satisfied and the Fridley HRA mortgage will be in a third position. I enclose copies of proposed Subordination Agreements. Please review this information and let me know if you require any further information for presentation to the HRA. Thank you for your time and attention. 'ricer ly, Michael F. Hu ey MFH:set Enclosure cc: Mr. Jerome Myers, Sheet Metal Connectors Mr. Robert Schwartz, Attorney at Law Mr. Robert Jensen, Northeast State Bank S SUBORDINATION AGREEMENT 1'5 THIS AGREEMENT, entered into on May , 1993, by betwen Northeast State Bank of Minneapolis, a Minnesota corporationd("Bank") the Housing and Redevelopment Authority in and for the City of Fridley, a public body corporate and politic organized under the laws of the State of Minnesota ("HRA") ; and Sheet Metal Connectors, Inc. , a - Minnesota corporation and MSCJ, Inc. , a Minnesota corporation ("Co- Borrowers") . WHEREAS, MSCJ, Inc. , a Minnesota corporation ("Owner") is the fee owner of that certain real property in Anoka County, Minnesota, legally described on the attached Exhibit A ("Property") ; WHEREAS, HRA is the owner and holder of a mortgage currently encumbering the Property, which mortgage is dated September 1, 1992, and was filed for record on March 4, 1993 as Anoka County Recorder Document No. 1025984 ("HRA Mortgage") ; and WHEREAS, Bank has agreed to loan Eight Hundred Seventy-two Thousand and 00/100ths Dollars ($872, 000. 00) to Co-Borrowers, which loan shall be evidenced by a note ("Bank Note") and secured by a mortgage dated May , 1993, on the Property ("Bank Mortgage") ; WHEREAS, Bank has expressly conditioned its duty to advance the funds to Co-Borrowers upon the Bank Mortgage and Bank Note being prior and superior to the HRA Mortgage; and WHEREAS, HRA has agreed to subordinate the HRA Mortgage to the Bank Mortgage and Bank Note in order to facilitate the receipt of the loan by Co-Borrowers. NOW, THEREFORE, in consideration of One Dollar and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged and of the covenants, promises, and conditions contained herein, the parties agree as follows: SECTION 1. SUBORDINATION HRA hereby covenants and agrees that the HRA Mortgage shall be considered, and in all respects shall be, subordinate to the Bank Mortgage and Bank Note and any extensions or renewals of the Bank Mortgage or the Bank Note; provided, however, that the amount of this subordination shall not exceed the original amount of $872,000.00 with interest thereon as provided in the Note, together with all other costs or expenses advanced pursuant to the terms of the Bank Mortgage or Bank Note and the statutory fees allowed upon the foreclosure of the Bank Mortgage. SECTION 2. FURTHER ASSURANCES HRA covenants and agrees that if reasonably deemed necessary by a title company or an attorney for a title company to properly document the subordination by HRA contained in this Agreement, then HRA shall duly execute and deliver to Bank and such title company any instrument, document, conveyance, release or waiver which will more fully and adequately subordinate the right, title, estate, lien and 1.6 interest of HRA to the right, title, estate, lien or interest of Bank. SECTION 3 . MISCELLANEOUS A. All rights and obligations arising out of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties hereto. B. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Minnesota. C. This Agreement shall remain in full force and effect until 30 days after all amounts due Bank pursuant to the Bank Mortgage and Bank Note have been fully paid and satisfied, and thereafter it shall terminate. After said termination, the parties shall execute such documents or instruments as may be necessary or required to remove any cloud on title caused by this Agreement. D. This Agreement or a memorandum thereof may be recorded in the appropriate offices in Anoka County, Minnesota to protect and give notice of the respective rights of Bank and HRA hereunder. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed the year and day above first written. Northeast State Bank of Minneapolis, a Minnesota corporation By: Its: Housing and Redevelopment Authority in and for the City of Fridley, a public body corporate and politic organized under the laws of the State of Minnesota By: Its: Sheet Metal Connectors, Inc. , a Minnesota corporation By: Its: -2- 1.7 MSCJ, Inc. , a Minnesota corporation By: Its: STATE OF MINNESOTA) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this of May, 1993, by the of Northeast State Bank of Minneapolis, a Minnesota corporation, on behalf of the corporation. Notary Public STATE OF MINNESOTA) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this day of May, 1993, by , the of the Housing and Redevelopment Authority in and for the City of Fridley, a public body corporate and politic under the laws of the State of Minnesota, on behalf of the City. Notary Public STATE OF MINNESOTA) COUNTY OF ANOKA ) ss. ) The foregoing instrument was acknowledged before me this day of May, 1993, by the of MSCJ, Inc. , a Minnesota corporation, on behalf of the corporation. Notary Public -3- 1.8 STATE OF MINNESOTA) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this day . of May, 1993, by , the of Sheet Metal Connectors, Inc. , a Minnesota corporation on behalf of the corporation. Notary Public THIS INSTRUMENT WAS DRAFTED BY: BARNA, GUZY & STEFFEN, LTD. 400 Northtown Financial Plaza 200 Coon Rapids Boulevard Minneapolis, Minnesota 55433 F:\realest\sln\mscj.sub -4- 1.9 SUBORDINATION AGREEMENT THIS AGREEMENT, entered into on May Coon Rapids Development Company, a Minnesota corporationy("CRDc") ;and t between Housing and Redevelopment Authority in and for the City of Coon public body corporate and politic organized under the laws of the State of Minnesota ("HRA") ; and Sheet Metal Connectors, Inc. , a Minnesota corporation and MSCJ, Inc. , a Minnesota corporation ("Co- Borrowers") . WHEREAS, MSCJ, Inc. , a Minnesota corporation ("Owner") is the • fee owner of that certain real property in Anoka County, Minnesota, legally described on the attached Exhibit A ("Property") ; WHEREAS, HRA is the owner and holder of a mortgage currently encumbering the Property, which mortgage is dated September i, 1992, and was filed for record on March 4, 1993 as Anoka County Recorder Document No. 1025984 ("HRA Mortgage") ; and WHEREAS, CRDC has agreed to loan Seven Hundred Fifty Thousand and 00/100ths Dollars ($750, 000. 00) to Co-Borrowers, which loan shall be evidenced by a note ("CRDC Note") and secured by a mortgage dated May , 1993, on the Property ("CRDC Mortgage") , which note will be guaranteed by the U.S. Small Business Administration; WHEREAS, CRDC has expressly conditioned its duty to advance the funds to the Co-Borrowers upon the CRDC Mortgage and CRDC Note being prior and superior to the HRA Mortgage; and WHEREAS, HRA has agreed to subordinate the HRA Mortgage to the CRDC Mortgage and CRDC Note in order to facilitate the receipt of the loan by Co-Borrowers. NOW, THEREFORE, in consideration of One Dollar and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged and of the covenants, promises, and conditions contained herein, the parties agree as follows: SECTION 1. SUBORDINATION HRA hereby covenants and agrees that the HRA Mortgage shall be considered, and in all respects shall be, subordinate to the CRDC Mortgage and CRDC Note and any extensions or renewals of the CRDC Mortgage or CRDC Note; provided, however, that the amount of this subordination shall not exceed the original amount of $750, 000. 00 with interest thereon as provided in the Note, together with all other costs or expenses advanced pursuant to the terms of the CRDC Mortgage or CRDC Note and the statutory fees allowed upon the foreclosure of the CRDC Mortgage. SECTION 2. FURTHER ASSURANCES HRA covenants and agrees that if reasonably deemed necessary by a title company or an attorney for a title company to properly document the subordination by HRA contained in this Agreement, then HRA shall duly execute and deliver to CRDC and such title company any instrument, document, conveyance, release or waiver which will more 1.10 fully and adequately subordinate the right, title, estate, lien and interest of HRA to the right, title, estate, lien or interest of CRDC. SECTION 3. MISCELLANEOUS A. All rights and obligations arising out of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties hereto. B. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Minnesota. C. This Agreement shall remain in full force and effect until 30 days after all amounts due CRDC pursuant to the CRDC Mortgage and CRDC Note have been fully paid and satisfied, and thereafter it shall terminate. After said termination, the parties shall execute such documents or instruments as may be necessary or required to remove any cloud on title caused by this Agreement. D. This Agreement or a memorandum thereof may be recorded in the appropriate offices in Anoka County, Minnesota to protect and give notice of the respective rights of CRDC and HRA hereunder. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed the year and day above first written. Coon Rapids Development Company, a Minnesota corporation By: Its: Housing and Redevelopment Authority in and for the City of Fridley, a public body corporate and politic organized under the laws of the State of Minnesota By: Its: -2- 1.11 Sheet Metal Connectors, Inc. , a Minnesota corporation By: Its: MSCJ, Inc. , a Minnesota corporation By: Its: STATE OF MINNESOTA) COUNTY OF ANOKA ) ss. The foregoing instrument was acknowledged before me this of May, 1993, by the of Coon Rapids Development Company, p of the corporation. P y� a Minnesota corporation on behalf Notary Public STATE OF MINNESOTA) COUNTY OF ANOKA ) ss. The foregoing instrument was acknowledged before me this day of May, 1993, by the of the Housing and Redevelopment Authority in and for the City of Fridley, a public body corporate and politic under the laws of the State of Minnesota, on behalf of the Housing and Redevelopment Authority in and for the City of Fridley. Notary Public -3- 1.12 STATE OF MINNESOTA) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this day of May, 1993, by , the of MSCJ, Inc. , a Minnesota corporation, on behalf of the corporation. Notary Public STATE OF MINNESOTA) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this day of May, 1993, by , the of Sheet Metal Connectors, Inc. , a Minnesota corporation on behalf of the corporation. Notary Public THIS INSTRUMENT WAS DRAFTED BY: BARNA, GUZY & STEFFEN, LTD. 400 Northtown Financial Plaza 200 Coon Rapids Boulevard Minneapolis, Minnesota 55433 F:\realest\sln\msc!-sba.sub —4— 1.13 ARTICLE VIII Mortgage Financing Section 8.1 Limitation Upon Encumbrance of Property. Prior to the completion of the Minimum Improvements, as certified by the Authority, neither the Redeveloper nor any successor in interest to the Redevelopment Property or any t engage in any financing or any other transaction rcreatingfanyall mortgage or other encumbrance or lien upon the Redevelopment Property, other than Permitted Encumbrances, whether by express agreement or operation of law, or suffer any encumbrance or lien to be made on or attach to the Redevelopment Property, other than Permitted Encumbrances, except: (a) For the purposes of obtaining funds only to the extent necessary for financing of the Minimum Improvements including, but not limited to, labor and materials, equipment, professional fees, real estate taxes, construction interest, organizational and other indirect costs of development, costs of constructing the Minimum Improvements, an allowance for contingencies, acquisition cost of the Redevelopment Property, costs of originating the Mortgage and customary financing costs. (b) in accordanceywith upon Sections o8. 1r rande8.2 n approval of the Authority The Authority shall not approve any Mortgage which does not contain terms that conform to the terms of Section 8.5, except as provided in Section 8.6 of this Agreement. Section 8.2 App rpval of Mortgage. The Authority shall approve a Mortgage if: (a) The Authority first receives a copy of all mortgage documents. ' (b) The Mortgage loan, together with other funds available to the Redeveloper, will, in the reasonable judgment of the Authority, be sufficient to construct the Minimum Improvements; -*— however, the Mortgage and Authority Mortgage shall not secure an amount greater than 90% of the costs described in Section 8. 1 (a) . (c) The Authority is not entitled under Section 5.2 to exercise any of the remedies set forth therein as a result of an Event of Default. (d) The Authority determines that the terms of the Mortgage conform to the terms of Section 8.5. 17 1. S 1.14 • However, the approval of a Mortgage by the Authority shall not be unreasonably withheld. Any Mortgage which is subordinated to the rights of the Authority under this Agreement may be granted in all or any part of the Redevelopment Property without the approval of the Authority. Section 8.3 Notice of Default; Cony. to Mortgagee. Whenever the Authority shall deliver any notice or demand to the Redeveloper with respect to any breach or default by the Redeveloper in its obligations or covenants under this Agreement, the Authority shall at the same time forward a copy of such notice or demand to each Holder of any Mortgage authorized by this Agreement at the last address of such Holder shown in the records of the Authority. Section 8.4 Mortgagee' s Option to Cure Defaults. After any breach or default referred to in Section 8.3, each such Holder shall (insofar as the rights of the Authority are concerned) have the right, at its option, to cure or remedy such breach or default (or such breach or default to the extent that it relates to the part of the Redevelopment Property covered by its mortgage) and to add the cost thereof to the Mortgage debt and the lien of its Mortgage; provided, however, that if the breach or default is with respect to construction of the Minimum Improvements, nothing contained in this Section or any other Section of this Agreement shall be deemed to require such Holder, either before or after foreclosure or action in lieu thereof, to undertake or continue the construction or completion of the Minimum Improvements, provided that any such Holder shall not devote the Redevelopment Property to a use inconsistent with the Redevelopment Plan or this Agreement without the agreement of the Authority. Section 8.5 Authority' s Option to Cure Default on Mortgage. Any Mortgage, unless such requirement is waived by the Authority, executed by the Redeveloper with respect to the Redevelopment Property or any improvements thereon shall provide that, in the event that the Redeveloper is in default under any Mortgage authorized pursuant to this Article VIII, the Holder shall notify the Authority in writing of: (a) The fact of the default. (b) The elements of the default. (c) The actions required to cure the default. If the default is an "Event of Default" under such Mortgage, which shall entitle such Holder to foreclose upon the Redevelopment Property, the Minimum Improvements or any portion thereof, and any applicable grace periods have expired, the Authority shall have, and each Mortgage executed by the 18 • 1.y5 Redeveloper with respect to the Redevelopment Property or any improvements thereon shall provide that the Authority shall have such an opportunity to cure the "Event of Default" within such reasonable time period as the Holder shall deem appropriate. Section 8.6 Subordination and Modification for the Benefit of Mortaaaees, (a) In addition to the subordination of the Authority Mortgage, in order to facilitate the obtaining of financing for the construction of the Minimum Improvements by the Redeveloper, the Authority agrees to subordinate its rights under this Agreement to the Holder of a Mortgage for the purposes described in Section 8. 1 (a) of this Agreement. (b) In order to facilitate the obtaining of financing for the construction of the Minimum Improvements, the Authority agrees that it shall agree to any reasonable modification of this Article VIII or waiver of its rights hereunder to accommodate the interests of the Holder of a Mortgage, provided, however, that the Authority determines, in its reasonable judgment, that any such modification(s) will adequately protect the legitimate interest and security of the Authority with respect to the Redevelopment Property. 19 t 2.1 Community Development Department partment =Ni HOUSING AND REDEVELOPM ENT AUTHORITY City of Fridley DATE: May 5, 1993 q. TO: William Burns, Executive Director of HRA4 r ~ FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: First-time Homebuyer Mortgage Program On April 30, 1993 we were notified by the Minnesota Housing Finance Agency that our application for the Minnesota City Participation Program (MCPP) had been received. Our application was one of sixty submitted for a total amount of $73,635,998.00. As a result, individual allocations will be reduced significantly. Attached is a spreadsheet prepared by MHFA which describes several allocation options. These options show the potential bond authority which may be allocated by 1) a proportional reduction, and 2) proportional reductions with various "floor" allocations. Based on these scenarios, we will receive anywhere from $1,453, 107 to $1, 166, 129. The final amount will be decided at a group meeting to be held at MHFA offices on Monday, May 12, 1993. It is important to point out that legal authority to issue mortgage revenue bonds has not been approved by Congress. It is uncertain when federal authority will be renewed, however the most optimistic projection is mid-summer. After the May 12th meeting, MHFA will begin drafting agreements for each city to sign. Once the ability to issue bonds has been authorized by Congress, MHFA will request each city to execute the agreement and submit a new deposit- and application fee based on their respective allocation amount. The deposit will be refunded approximately two weeks after the bond sale. (The deposit and application fee we submitted with our original application will be returned on May 12th. ) Staff Recommendation Staff recommends that the HRA approve the MCPP application and Resolution No. HRA 1 - 1993 authorizing participation in the MCPP. M-93-256 2.2 r.1 �A. . ' �--� O ,..� Cp 01 N 0 0 0 O N O N N N U1 0 C0 0 C0 0 01 co N O N 1.01 O O O O CT c+1 N - ao w o m CN0000tvc' `;:4 om .c.:1c'IN2 � o oorfiIll 0 � a0000mN .... Ul O U1 01 t0 .--I U1 U1 O N Ul N O .-i U1 U1 t0 O CC U1 N O t0 O4 U1 U1 t0 N Ci U7 O a c•1 U1 O V• O N U1 .--1 N N U1 N N C11 N ."1 01 C11 N N 01 N N N 1� N ., N 01 CO V' Ut N Ut ri N C/1 co in 40 L? N tR C? • 1? Z7 Z? C/D N [R <h 4T t? N CI} N LT VT i? K t? !? [? CR N f? 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C .a•1.H 0 W H 00,14 V•14 W•L-1 N 9►1 W U.� a O w 014 '0 0 'VC4 0 coo b1 mi, o'i <CD m co�0 U.0 9-1 w 4.).0 ii.0 w4 A4 .0.0 > wA °lj ° " A°' ° � °� 0 ° ° w ° °U a a as aa aa Cl) nac) U C.) a w w 0x$ ca aaa xu c x x a as 2.4 RESOLUTION NO. HRA 1 - 1993 RESOLUTION AUTHORIZING PARTICIPATION IN THE MHFA MINNESOTA CITY PARTICIPATION PROGRAM WHEREAS, the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority") finds it desirable to encourage home ownership opportunities; and WHEREAS, the Authority finds it cost-prohibitive to issue mortgage revenue bonds on its own; and WHEREAS, the Authority has been invited to participate in the Minnesota City Participation Program offered by the Minnesota Housing Finance Agency (the "MHFA") ; and WHEREAS, said program would issue bonds on behalf of the Authority for the purposes of providing low interest mortgage financing to first-time homebuyers. NOW, THEREFORE, BE IT RESOLVED that the Housing and Redevelopment Authority in and for the City of Fridley hereby authorizes and directs staff to submit an application for the MHFA Minnesota City Participation Program and further authorizes the Chairperson and Executive Director to enter into the necessary agreements for the implementation of the program. PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY THIS 13TH DAY OF MAY 1993. LAWRENCE R. COMERS, CHAIRPERSON ATTEST: WILLIAM W. BURNS, EXECUTIVE DIRECTOR 2.5 APPLICATION FOR FUNDING MINNESOTA HOUSING FINANCE AGENCY 1993 MINNESOTA CITY PARTICIPATION PROGRAM FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY 6431 UNIVERSITY AVENUE N.E. FRIDLEY, MINNESOTA 55432 April 14, 1993 2.6 APPLICATION FOR FUNDING MINNESOTA HOUSING FINANCE AGENCY 1993 MINNESOTA CITY PARTICIPATION PROGRAM I. ELIGIBLE ORGANIZATION (a) Name and Address of Organization Fridley Housing and Redevelopment Authority 6431 University Avenue N.E. Fridley, MN 55432 (b) Name and Phone Number of Contact Person Grant Fernelius, Housing Coordinator, #572-3591 (c) Bond Allocation Meeting Representative Same as (b) (d) Type of Organization HRA (e) $2 , 249,999, 28 loans at an average of $78 ,256 per loan II. ORIGINATING LENDER See attached letters of intent from Marquette Bank Brookdale and Metropolitan Federal Bank. III. HOUSING PLAN (a) & (b) Description of Principal Housing Needs In 1991, the Housing and Redevelopment Authority commissioned the Maxfield Research Group to complete a housing market analysis of the City's housing stock. As a result of the market study, the City of Fridley conducted an in-house strategic planning process to develop recommendations to the City Council and the Housing and Redevelopment Authority to initiate an aggressive housing program. An Executive Summary of the study is attached. (c) Action Plan to Address Housing Needs To address some of the needs identified in the study, the City Council and HRA have either established or agreed to participate in the following programs: 2.7 APPLICATION FOR FUNDING MINNESOTA HOUSING FINANCE AGENCY 1993 MINNESOTA CITY PARTICIPATION PROGRAM PAGE 2 CDBG Housing Rehabilitation Program $181,000 has been allocated for this activity which will provide interest free grants to low income homeowners. HOME Housing Rehabilitation Program $70,000 has been allocated under this program which provide grants similar to those described above. MHFA Great Minnesota Fix-Up Fund The HRA has allocated approximately $60, 000 to provide gap financing for eligible households. Applicants who cannot afford the additional improvements which may be required and exceed the amount approved by the bank and MHFA may apply under this unique program to borrow up to $5, 000 interest-free. MHFA Rental Rehab Loan Program Approximately $110, 000 has been allocated to provide gap financing for multi-family owners who need additional improvements but cannot afford the cost beyond what is approved by the bank and MHFA for a loan. Fannie Mae - The HRA will allocate approximately $100, 000 to enable eligible households to refinance their homes in conjunction with moderate rehabilitation. The funds would be used to provide loans of up to $6,000 for such purposes as interest-rate reduction, down payment assistance, closing costs, etc. Reserve Fund - $50, 000 will be allocated to assist individuals who are ineligible for any other program or assistance. It should be noted that the programs described above are in the planning process but are anticipated to be operational by mid-summer 1993 . (d) N/A (e) Plan Implementation and Administrative Capacity The housing rehabilitation programs described above will be administered in cooperation with the following organizations: 2.8 APPLICATION FOR FUNDING MINNESOTA HOUSING FINANCE AGENCY 1993 MINNESOTA CITY PARTICIPATION PROGRAM PAGE 3 - Fridley HRA - Anoka County Community Action Program, Inc. - Fridley State Bank IV. PROGRAM SPECIFICS (a) How Program Fits into Comprehensive Housing Plan The Fridley first-time homebuyer program will complement efforts by the City and HRA to improve the housing stock and provide opportunities to strengthen the livability of the community. The HRA's current financial position dictates that programming efforts are better suited to assisting homeowners via small grants or loans. The MCPP provides mortgage financing aimed at a market which the HRA is financially incapable of addressing. It is anticipated that the program will attract or retain younger households (those in the 18-34 year old age group) in the community who may otherwise live elsewhere. (b) Borrower Income Limits The Fridley program will utilize the maximum income limits allowed under the MCPP. According to the 1990 census, the average household income was $36,855. Assuming some adjustments to this figure since 1990, it is still expected that an average household would qualify for the program. (c) Purchase Price Limits Although the Fridley program will incorporate the maximum purchase price limits allowed, the HRA may petition to increase the price limit at a later date. (d) N/A (e) N/A (f) N/A (g) N/A (h) Why Program is Good Candidate for Funding The Fridley MCPP would be a good candidate for funding due to the fact that the program has not been previously offered. Further, the Maxfield study indicated that 2.9 APPLICATION FOR FUNDING MINNESOTA HOUSING FINANCE AGENCY 1993 MINNESOTA CITY PARTICIPATION PROGRAM PAGE 4 Fridley, unlike other cities in the study area, had an increase in the number of households in the 18-34 age group between 1980-1990. The City is therefore uniquely positioned to retain these households in the community by providing an opportunity for young households to move through the housing life cycle and purchase a single family home. The Maxfield study also identified a strong single family market in Fridley. Housing values have remained relatively stable making homes attractive and affordable to first-time buyers. V. ECONOMIC VIABILITY It is anticipated there will be sufficient demand for the MCPP funds. Based on data provided by the City's Assessing Department, in 1992 there were 303 single family home sales. Below is a chart which shows the number of sales and average sales price for homes in selected price ranges: No. of Percent Price Range Sales of Total Average Price $10, 000-$49,999 7 2% $ 45, 298 $50,000-$59,999 10 3% $ 55,010 $60, 000-$69,999 39 13% $ 65,984 $70, 000-$79, 999 75 25% $ 75,853 $80,000-$89,999 71 23% $ 84, 162 $90, 000-$99, 999 40 13% $ 94,206 $100, 000 + 61 20% $127, 285 As evidenced by these statistics, more than 40% of the sales were in the $80, 000 category or less and approximately 2/3 of the sales were in the $90,000 category or less. Many of these homes would be suitable for purchase by first-time buyers. VI. NEW CONSTRUCTION Due to limited activity, new construction will not be included as part of the Fridley MCPP. VII. SIGNATURE 942/44(41/7 William W. Burns 7 / y Date Executive Director Fridley HRA y Marquette Bank 2.10 Brookdale.�., 5620 Brooklyn Boulevard Brooklyn Center,MN 55429-3084 (612)561-2530 • April 12, 1993 Mr. Grant Fernelius City of Fridley 6431 University Avenue N.E. Fridley, Minnesota 55432 RE: 1993 Minnesota City Participation Program Dear Mr. Fernelius: This letter shall serve as Marquette Bank Brookdale' s intent to participate in the above referenced mortgage program in your community. Please note that any future correspondence relative to this program should be directed to the attention of Karen DuCharme, Assistant Vice President, Mortgage Department. Sincerely, • Karen L. DuCharme Assistant Vice President Mortgage Department 04-12-1993 17:07 225 7310 METROPOLITAN FEDERAL BANK P.02 The Heartland§ Bank- 2.11 For Home Loans. METR ' . A ,. FEDETL BANK ,, AFOXIIAL WANNAM PM INSURED April 12, 1993 • City of Fridley 6431 University Avenue N. E. Fridley, MN 55432 Attn: Grant Fernelius Dear Mr. Fernelius: Please accept this letter as confirmation that Metropolitan Federal Bank is willing to be a lender for the City ! of Fridley under Minnesota Housing Finance Agency's Minnesota City Participation Program. If there is any other information you need, please do not hesitate to contact me at 225-7215. Sincerely, METROPOLITAMEDERAL BANK, fsb 7C,9 Colleen P. o Kane Vice President cpo • • METROPOUDIN FEDERAL BANK BURDUIG•425 ROBERT STREET NORM•St PAU1,t4N 55101-2019 •Pt1ONE(612)225.7000•FAX(612)225.7305 cow.*swam ta�o[x c 3.1 Community Development Department p t \ HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: May 6, 1993 TO: William Burns, Executive Director of HRA 4 FROM: Barbara Dacy, Community Development Director SUBJECT: Consideration of Additional Improvements in Cooperation with Mississippi Street Improvement Project The Mississippi Street improvement project was initiated on April 12, 1993. A number of issues have come to our attention which the HRA needs to review and provide additional direction to staff. 1. Rice Plaza Traffic Flow It was originally contemplated that the drive-through traffic for the Dairy Queen would have to be realigned from its current location to the front of Rice Plaza and then exit to the rear of the Rice Plaza building. In fact, as part of the 1991 lease agreement with Dairy Queen, the HRA agreed to pay for the costs of the realignment. The HRA is not now obligated as part of the Dairy Queen lease to make those improvements because the Mississippi Street improvement project did not start until July 1, 1992, as stipulated in the Dairy Queen lease. Unanticipated, however, was the impact of the street widening on the Rice Plaza parking lot. The contractor has identified on the parking lot pavement where the new curb line would be placed after the widening of Mississippi Street. It was determined that there was only 38 feet from the edge of the new curb to the east end of the building. The distance widens toward the west end of the building. Staff conducted "parking tests" on site as well as measuring parking spaces and driving lanes to determine if proper traffic flow could be achieved on the property. We have also received complaints from tenants about the traffic flow on the property. We received one letter objecting to the Dairy Queen traffic being routed in front of the Rice Plaza building. In order to provide for proper traffic safety on site, staff has developed a striping and improvement plan to accommodate traffic from the Rice Plaza building and the Dairy Queen 3.2 Mississippi Street Improvement Project May 6, 1993 Page 2 drive-through (see attached) . The plan proposes a one-way driving and parking condition from west to east. A separate lane will be striped for Dairy Queen traffic. Angled parking space stripes will be added to the front of the building. While the Dairy Queen traffic will continue to exit from the existing driveway, Rice Plaza traffic will need to be routed to the rear of the building on a new driveway to connect to Third Street. Using the existing pavement at the rear brokenof the building is unsafe because of poor sight lines, pavement, and proximity to loading areas. Estimated cost for the improvement is $5,000. The County has agreed to perform the pavement work; a separate contract with a striping company would be executed. The budgeted amount for this project is $300, 000. Current estimates for HRA costs are $250,000 plus about $30, 000 in engineering fees (County ;and MnDOT changes) . There is an adequate surplus in the Mississippi Street improvement budget to accommodate this expense. staff Recommendation: Staff recommends docat uments to complete the HRA authorize the improvement to execute the necessary do as shown on the attached plan. 2. Landscaping Replacement at Target and Holly Center Sites First, the good news! The County has agreed to save the White Oak on the Target site, and the sidewalk will be routed around the tree. The bad news is that some of the vegetation along the Target and Holly Center sites will be affected by the street widening. When the landscaping was originally installed, bushes and shrubs were located in anticipation of the street widening. Unfortunately, the construction area around the right-of-way will necessitate the following: (1) Removal of four evergreens at the southwest corner of 5th Street and Mississippi Street (2) Removal of two evergreens on the west side of the Target driveway (3) Removal of bushes and five Crab trees along the north side of the Target building (4) Removal of all vegetation along the Holly Center parking lot. We have instructed the contractor to save as much as possible. 3.3 Mississippi Street Improvement Project May 6, 1993 Page 3 In the case of the Holly Center site, the City assessed the cost of the landscaping as part of the parking lot improvement project. Target installed its landscaping as part of its development project. The HRA owns the property surrounding the Target building including the parking lot. Because the existing property owners have already incurred the initial expense for the landscaping and because removal of the vegetation will significantly detract from the appearance of the intersection, staff recommends that the vegetation be transplanted or replaced. Further, without the landscaping, the properties would be in violation of existing landscaping ordinance requirements. We have obtained quotes from two landscaping companies. Replacement of all the vegetation would total approximately $9, 600; this includes transplanting the Crab trees and replacement of the evergreens. Again, enough surplus exists in the improvement budget. Recommendation: Staff recommends that the HRA authorize staff to execute contracts to transplant or replace vegetation as necessary at a cost not to exceed $9, 600. 3 . Landscaping at the Intersection As part of the University Avenue Corridor improvement plans, landscaping was proposed at every intersection along University Avenue. During the Mississippi Street project review in 1991, staff requested the County to include the intersection landscaping as part of the project. In a letter dated March 15, 1991, to John Flora, the County requested the City to install the plantings in the fall after construction. As you know, the project was delayed one year, and the County proceeded to let the contract without the landscaping element. It is cheaper for the HRA to bid and to install the landscaping. Apparently, according to the County, it is typical for the general contractor to add a specified percentage increase on top of the subcontractor cost. The vegetation in the intersection would be located at each of the four corners and along the abutting rights-of-way. Given the expenses cited above, we should solicit quotes from landscaping companies to determine the cost of the landscaping improvements. At that time, the HRA can decide whether to proceed with a fall installation or wait until the next budget year. After expenses for items 1 and 2 above, about 95% of the budget will be expended. We should have final costs from the County in August. 3.4 Mississippi Street Improvement Project May 6, 1993 Page 4 Recommendation: Staff recommends that the HRA authorize staff to solicit quotes for the intersection landscaping and schedule final action for the HRA in August or September. BD:ls M-93-254 . ( - .• • . ."'',,",::- I ,_____ _____. ..-, ...,,,,a1:'; ''2.:;.:.-..,,' • ..„.; z.,:•.. . ,„.* • : • :. I ,..-,.. : ----• ,--,,, - -t,..:t',•-, 4,,rij' --0.'" - •--- 3.5 .1. - .,.., ..., .,,,..,... .-,...:.:-.-..) - I .:...:,,.:„...,..,„,,.....,- , ..,I --174-4-4,--,' -.4,4,%;:aiNi"oz,v_., . . . :, ..x., .,,,r.:. ;•-00:0•••,. .5.1F7,,,, ... _, ._...- ,,r7.r 4,-iii,01,....•.:,. .• .• •• --„,,,,,i-,,,,.',,,,:.,-' •• „ . .... ..,..e• ... i --- ---,t‘ • ,-, .,,,,.4,..-1:::,r.S.2.4%,•A A.,.- ". •••,r`...4,--. -..--.:-.----r.ii7; . .. 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"....• • : . .--',' ' ,..:. . .., •..,-... . ,..,. ..;:: ..,!...,., -:'.-,',i,. ;:•. ...;:r•si..:•-• * .47,j,7-,,, 5:.,.,#,P, ..„,--,1,mt ...........77.'Aottlf • ,,.„,,,n,1,-...,_- ,,,,,„•;,,..-;,.., ....,.;..-.,,,- •,.7..titilv„, Engineering Seatewerr 3.6 W W Y O Parks 0 3 Streets U Maintenance — W J CC CO 0a MEMORANDUM TO: Barb Dacy, Community Development Director PW93-142 FROM: Scott Erickson, Asst Public Works Director DATE: April 20, 1993 SUBJECT: Rice Plaza Driveway Extension Cost Estimate Per our conversation, the following cost estimate was generated to construct a 20-ft wide temporary asphalt drive (one-way traffic) behind Rice Plaza to direct the flow of traffic at this location out to 3rd Street. The estimated cost breakdown is as follows: 21/2 thick - #2341 asphalt wear course (9,cti '� '2 _44 $2,000 4-in. thick - Class 5 base material 1,000 Common excavation 600 No parking and one-way templates 200 Signs 100 Parking lot striping 800 Total Estimated Cost 5� Depending on the timing of this work, we may be able to include this with the current County reconstruction contract with Forest Lake Contracting. The alternative options are to include the work in our 1993 street reconstruction project or let a separate contract. Let us know if you would like to proceed with this construction. SE:cz FRIDLLEEY iI II f 3•� lekA(10Z1/�-�1 21, &-,,y- - -- ,.hL.--1.<127471/214j1 - -ee( I st-Ld al-711 it_ ,,21 7-tadt- 47/24 ,4%,-, 24,-(;a_11 ,// 144-71.ti am' 4'7"_� _ I � .otz(-07 447.k (77„fr,44 te,„; / 1 t 717: /1-- ty7 r r J � , r'' 3.8 °~p `°°� COUNTYOFANLV Department of Highways Paul K. Ruud, Highway Engineer M"rNE S°,P,i. 1440 BUNKER LAKE BLVD NW,ANDOVER, MINNESOTA ___ - _ -_ . _ _ ____ March 15, 1991 City of Fridley 6431 University Avenue NE Fridley, MN. 55432 Attention: John Flora Director of Public Works Regarding: Mississippi Street Improvement SAP 02-606-08 Dear Mr. Flora: We have received your letter dated February 27, 1991, regarding final adjustments in the plans prior to bid letting. I have the following comments on your letter. 1) Page 3 the median note on concrete paving stone pavement appears to be appropriate from my perspective. 2)The Anoka County Highway Department has long used lanin stone for retaining walls and in the interest of continued consistency would prefer to use lanin stone rather than key stones. 3)The City's standard sidewalk is 5 feet wide. The drawing indicates sidewalk 5 feet 21/2 inches in width on some locations. This is to allow for a straight backside to the sidewalk and allow for the placement of the concrete paving stone pavement in a checker board type pattern as requested by the City. 4)The City method for securing the concrete paving stone pavement has been added to the plans. 5) The note regarding B618 Concrete Curb and Gutter has been relocated to a more appropriate location. 6 & 8) Quantities have been included or will be included by Change Orders to accomplish this construction at the time you provide them for us. 7)250 Tons of bituminous material has been added for parking lot in front of the municipal liquor warehouse. 9)The two street lights in conflict with the entrance to Billings Drive have been relocated immediately to the west side of the driveway. Affirmative Action / Equal Opportunity Employer AN 3.9 -2- 10) Stamark material has been specified at the stop bars and cross walks at the intersection in lieu of painting. The City will be responsible for x maintenance of this Stamark material. 11) Because of the anticipated lateness of construction and the problems that Anoka County foresees in providing the plantings called for in the Barton- Aschman Corridor Plan. We suggest that the City of Fridley provide for those plantings in the Spring of 1992 following construction. Our plans include the preparation of an area for these plantings, but feel the most appropriate for you to not only provide the plantings but also provide the guidance and administration necessary for their installation. In addition we would anticipate poor survival over the Winter of 1991 - 1992, should they be planted in the Fall and considering the fragile condition of newly planted shrubs along with the anticipated amount of sand/salt spray which they will undoubtedly receive at that location. • The total cost of these plantings will be borne by the City in either case and it would seem appropriate that the City install them in the Spring of 1992. Hopefully these items will be consistent with our recent discussions and acceptable to the City of Fridley. I am in the process of revising the proposed Cost Sharing Agreement and should have that to you in the relatively near future. If you need additional information in the interim,please call myself. dincerely, f IF Jo;G. Olson, PE D ..uty County Engineer 4.7 HCommunity Development Department UING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: May 6, 1993 0: William Burns, Executive Director of HRA J, ' ' ROM: Barbara Dacy, Community Development Director SUBJECT: Consider Amended Leasehold Agreement for Fridley Plaza Office Building Parking Lot Background $n February 13, 1992, the HRA approved a third amendment to the leasehol• agreement between the HRA and Columbia Park Properties to correct a lega description error. At that time, the attorney for Columbia Park Properties, like Hurley, suggested that since the amendment was the third amendment, - new leasehold agreement should be prepared to incorporate all previou- agreements. Further, Columbia Park Properties hired Frauenshuh Companies to manage the office building. Staff has met Frauenshuh Companies on a number of occasion- regarding the ongoing maintenance issues including snow removal, parking lou aintenance, and lawn and irrigation maintenance. None of the previou- leasehold agreements specifically stated maintenance responsibilities. These two factors have led both staff and Columbia Park Properties to suggest a revised leasehold agreement. Agreement Since the Fridley Plaza Office Building was constructed, the City has been responsible for maintaining the irrigation system to the boulevard area•. along Fourmies Avenue and 5th Street, as well as to the vegetation in thy• Plaza area. Further, the City has been responsible for the lawn an4 vegetation maintenance in these area as well as snow removal ant; miscellaneous parking lot items. The original lease agreement stipulated an $800 per month rental payment As the HRA will recall, the former owners of the property were in arrears an; an agreement was made to waive $9,200 in delinquent rental payments upo payment of $10, 000 and satisfactory- payment of the rent for three years unti April 1, 1994. The current owners are paying the rent on time. i 4.2 . • Amended Leasehold Agreement for Fridley Plaza Office Building Parking Lot May 6, 1993 Page 2 The original lease also stipulated a term of 99 years. The term of the proposed lease has not changed. The original lease also, provi ad the a the property owners with the option to purchase the parking l 5 in proposed termination of the lease in the year 2081 (see paragraph lease) . Paragraph 6 of the proposed lease specifies maintenance responsibilities. Columbia Park Properties will be responsible for ongoing snowplowing of the parking lot, and the City will be responsible for removing the piles of snow within 72 hours. This has been the general arrangement between the City and the building owner in the past. The City is also responsible for street and parking lot lighting. There is no change to this responsibility. Since the parking lot was constructed, the parking lot has not been sealcoated or restriped. Columbia Park Properties is requesting that the parking lot be sealcoated and striped this year. The proposed agreement proposes a semi-annual striping and sealcoating of the parking lot. A semi- annual schedule is excessive. Staff recommends the lot be sealcoated and striped once every four years. Estimated cost of the sealcoat and the striping is approximately $2,400-3,400. The annual rent payments of $9,600 could be used to defray the maintenance expenses. The proposed agreement also provides for the continuing maintenance of the lawn and shrubbery in the boulevard areas along the streets. Any vegetation, however, within the Columbia Park Properties' property lines (see attached survey) would be the property owner's responsibility. he At some time in the thaure,t the HRA would be responsiblete parking lot may have tfore this acost. TAn agreement stipulates estimated cost for repaving is approximately $4,500. Finally, the agreement proposes that the HRA sweep the parking lot in the spring and in the fall. The Public Works Department has swept the parking lot according to this schedule. Recommendation Staff recommends that the HRA authorize the Chairperson and Executive Director to execute the revised leasehold agreement subject to amending paragraph 6C, the last sentence, to read: " . . .the option parcel shall be mmends the HRA author and strip t execute everyonce contracts to ha e t e park g lot a . Further, o HRA sealcoated authorize staff and striped in cooperation with the property owner. BD:ls M-93-259 4.3 yta ye • . .4-ktx , ff.°9 . , r G Sf�� • C -f :-. VA q'e v : is a0 In • • t i• F A.\ I`^ it Co n s><iac Rion iQiG •o -7 'L Et./"Csx. C•6 ae'sYwor. 5 yS 8 - 4/rr r. Gi9G 1uirir11s443 ir.*:'4.%:':'s:....?.:::•:ff,„•'1 ilgrj•z.7."--.;:%'::,:-.-.3i ESM'Aivrt-;•••:::.;:./...,,-.-,-.,.•• , ....--•• .•:•,,, „,.. - Afrirrox- thy, a:ye:wool.17ec .0ek zo Se6•Sl'40'C-6.A 11 03y .nefe- !!' , . • J \Y1 1/11,1 —e�X6 J _ =.t I Fridley Plaza Office Bldg. ` +-1 mi Jotsf oo jal V .,'. !1�..: '�i. i.Q - • water f! f 6G01 Unwersity N.E. o• `- f-' Seivrc Ave, !:•; _ e �ti. G - It �Appre�r.: .s __3—ST—Brick `._; f ilk()Scrla _. ' ' EaseMcivr i B e �t ` 3 11,386.4 S.F. It 441 \ \ #.1:-:;!:;:t. OW 20 t �L `\ : ,-,kg -,--.;':.... y t , �`, % \\ I :t:_ ' Ewe'` = � � r p Al• I NB8 59'40•Ip `.•r'• C_ •.-.Air'. -cZ�_ _ r -� / / '} I it CJ y r� 4[ ? s bpi' ` � rifiliN44M, r?ti f,,, \\,\ . R 4 „t ........„.„4„ . .. . ':c s. s ,...„,,,„,,,...,,,,,. \ .. hN - TMQ w C oat. O.`.: or /y� s� .aN Vo Ny/ \'? r?P/ie•c . , Y— r«•,s Fourmi :: Tom,:;r_ es Ave. , p !k i, t 1'3 � •#j ram,-;'r•r7 .. j�.:< :;.:1 •' trig '. s•.6.. z. . c.:a;cJ�i}. .;-� �:r, < '3 ' 7 " -- 'e`er c ,^ 612 780 1777 FROM BRRNR GUZY 5. 6. 1993 13:38 P. 2 4.4 AMENDED AND RESTATED LEASEHOLD AGREEMENT This Amended and Restated Leasehold Agreement, entered into this day of May, 1993, by and between THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FapdT�pLUMBIA PARK PROFERTIESE CITY OF FRIDLEY, ESaTA (hereinafter called the "HRA") , Minnesota Partnership (hereinafter called "Redeveloper") . WHEREAS, on the 20th day of September, 1982, the HRA and the Fridley Office Plaza Building Partnership entered into a Leasehold Agreement ("Leasehold Agreement") which required the HRA to provide the Fridley Plaza Office Building Partnership with a non-exclusive right to lease a 166 car parking lot; and WHEREAS, the Leasehold Agreement was amended pursuant to Amendment to Leasehold Agreement, dated August 1, 1988, providing for the construction of a parking ramp on the site of the parking lot; and -ea WHEREAS, the Leasehold Agreement was further amended by 1 , = ,, - t.,.--dated- February 22, 1989, which revised the legal d= -cription of the property subject to the Leasehold Agreement to a i .rd the Fridley F aza Office building Partnership additional v= icle ingress and iS,, grass acc' es to the parking ramp parcel; and WHEREAS, the HRA atd the ridley Plaza Office Building P- . nership entered into., hat ertain Memorandum of Leasehold A, -ement, dated February 2, 989, filed March 9, 1989, in the 0 f , ce of the Anoka County ec rder as Document No. 842658, to eta ish the Leasehold Agrem nt of record; and WH. 'EAS, the Fridley Plaz4 Office Building Partnership a, =igneelts interest in the L6asehold Agreement to Performance I estmen s, a Minnesota Partn rship, by Assignment, dated March 3, 1989; nd i WHER 87-perfdrmantt-I ve tments assigned its interest in t , Leasehold Agreement to Red veloper by assignment of Leasehold Interests,'--dated August 29, 1.9 1; and WHEREAS, the parties to this Agreement have discovered that the new legal description is not correct and the parties agree that the Leasehold Agreement, as amended, should be further amended and restated to clarify the terms and conditions thereof. NOW, THEREFORE, the parties to this Agreement, in consideration of the promises, covenants and agreements made by each to the other, do hereby agree to amend and restate the Leasehold Agreement as follows: 1. pease / Purpose. The HRA hereby leases to the Redeveloper the property described on Exhibit A ("Leasehold Property") attached hereto for the purpose and non-exclusive use of the property for parking of vehicles associated with the use lfff FROM BPRNR 6UZV 5. 6. 1993 13:39 P. 3 . 4.5 and operation of the building located on land owned by Redeveloper and described on Exhibit B attached hereto ("Redeveloper Property") . Further, the HRA grants to or any future holder of the lessee's interest herein, for thebenefit of the Redeveloper Property, the non-exclusive right of ingress and egress over and across the Leasehold Property. This lease shall be binding upon the heirs, successors and assigns of the Redeveloper. The Leasehold Property includes the parking lot and bi-level ramp. 2. Term of Lease. The term of the Lease commenced September 20, 1982 and continues until September 20, 2081, unless sooner terminated as provided herein. 3. Monthly Rent. The Redeveloper shall pay as and for the rental of the Leasehold Property as defined herein, the sum of Eight Hundred and No/100 Dollars ($800.00) per month. Rental payments are due on the first day of the month and shall be considered late after the tenth day of the month. 4. 7orgiyepess of Back Rent. Performance Investments, a previous holder of the Lessee's interest in the Leasehold Property was delinquent in lease payments under the Leasehold Agreement in the amount of $19,200.00. In consideration of the payment of $10,000.00 to the HRA by Redeveloper, the HRA agreed to waive and forego $9,200.00 in delinquent rental payments owed under the Leasehold Agreement on the condition that Redeveloper pays all rental payments when due or within 30 days after receipt of written notice of the payment being due, for all monthly rental payments which are due through April 1, 1994. On April 1, 1994, if Redeveloper has paid all rental payments due and owing as provided herein, then in such event, all delinquent rent referred to herein shall be deemed forgiven. In the event Redeveloper fails to pay any rental payments within thirty days after receipt of written notice as provided herein, then in such event, in addition to any other remedies available, the HRA may demand that the additional $9,200.00 in delinquent rental payments be paid in full immediately. 5. Option to purchase. Upon the expiration of the lease term as provided herein, assuming Redeveloper has not defaulted under the terms and conditions of said lease, then in such event, the Redeveloper shall have the option to purchase from the HRA the real property described on Exhibit C attached hereto ("Option Parcel") . The purchase price for Option Parcel shall be its fair market value at the time the option is exercised. In the event Redeveloper exercises this option, then in such event, Redeveloper and the HRA shall close on the purchase of the Option Parcel within 90 days after the expiration of the Leasehold Agreement. The HRA shall be obligated to deliver marketable title to the Option Parcel free of any liens or encumbrances delinquent taxes and special assessments. The Redeveloper may -2- 612 780 1777 FROM BARNA 6UZY 5. 6. 1993 13239 4.6 P• 4 exercise this option only be delivering written notice of its option to purchase by certified mail or by hand delivering to the HRA not more than twelve months nor less than six months prior to September 20, 2081. In the event the ERA and Redeveloper cannot come to an agreement as to the fair market value of the Option Parcel, within thirty days after the Notice of Option to Purchase has been delivered as provided herein, then in such event, the fair market value of the Option Parcel shall be determined in the following manner: Both the HRA and the Redeveloper shall each select an MAI certified appraiser and they shall each mutually agree upon a third MAI certified appraiser. The average of the three (3) appraisals shall then be the fair market value. Both the HRA and the Redeveloper will pay for the cost of the appraiser which they appoint and shall share equally in the fees incurred for the third appraiser. 6. Maintenance Qf the Leasehold Property. (a) Snow Removal. Redeveloper shall be obligated to provide the snow removal, at its sole cost and expense, of the Option Parcel, which property is included in the Leasehold Property and shown as the cross-hatched parcel on Exhibit 0 hereto. Nothing herein provided shall obligate Redeveloper to do any snow removal on any remaining portion of the Leasehold Property. All snow removal on sidewalks connecting the Option Parcel and Redeveloper's property • shall be completed by Redeveloper at its sole cost and expense. Redeveloper shall be obligated to push all snow accumulations from the Option Parcel to an area of the Option Parcel which shall be agreed upon by the City and Redeveloper. Within 72 hours after placing said snow in the area of the Option Parcel described above, the HRA agrees to remove, at their sole cost and expense, the snow placed in said area by the Redeveloper. (b) Street and Parking Lot. All lighting of streets and parking lot which is adjacent to the Redeveloper's property and serves said Leasehold Property, shall be paid by the HRA. (c) Maintenance, seal coating and Striping the Option Parcel Leasehold Property. All maintenance, seal coating, striping and resurfacing of the option Parcel shall be undertaken and completed by the HRA at its sole cost and expense. All striping, seal coating or resurfacing of the Option Parcel shall be done on an as needed basis. The Redeveloper shall contact the HRA and notify the HRA of its request for any such maintenance, seal coating and striping of the Option Parcel. The HRA and Redeveloper agree that -3- 612 780 1777 ... , .,,...,�� FROM BARNA GUZY 5. 6.1993 13:40 P. 5 4.7 the Option Parcel shall be seal, coated and striped at least semi-annually. (d) Ka►intenano• of Lawn and Shrubbery. Any lawn area, shrubbery located on the Redeveloper's Property shall be maintained by Redeveloper at its sole cost and expense. Any lawn area or shrubbery lying outside of the Redeveloper's Property and included within the Leasehold Property hereto shall be maintained at the sole cost and expense of the HRA. (e) Paving and Curbing of Leasehold Property. Any paving and curbing replacement of the Option Parcel shall be at the sole cost and expense of the HRA. (f) Parking Lot Sweeping. The HRA shall, at least once each spring and once each fall, during the lease term, sweep the Option Parcel. 7. Real Estate Taxes and Special Assessments. All real estate taxes or special assessments levied against the Leasehold Property shall be paid by the HRA. 8. Mgt. In the event of any default or failure to pay rent under the terms and conditions provided herein and Redeveloper fails to cure said default within 30 days after receipt of written notice from HRA, then in such event, the HRA may terminate the lease. The only remedy of the HRA for failure to pay the rent or any other violation of this lease shall be termination of this lease. IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed as of the day and year first above written. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOTA By:. Lawrence R. Comers Its: Chairman By: . Willem W. Burns Its: Executive Director -4- immommimmemimw 612 780 1777 FROM BARNA GUZY 5. 6. 1993 13:41 4.8 P. 6 STATE OF MINNESOTA) ) Ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of 1993, by Lawrence R. comers, Chairman and William W. Burns, Executive Director, of The Housing and Redevelopment Authority in and for the City of Fridley, Minnesota a political subdivision of the State of Minnesota, on behalf of said Authority. Notary Publ c • COLUMBIA PARK PROPERTIES By: A Managing Partner By: A Managing Partner STATE OF MINNESOTA) ) es. COUNTY OF ) The foregoing instrument was acknowledged before me this day of _ , 1993, by ann , Managing Partners of Columbia Park Properties, a Partnership under the laws of the state of Minnesota on behalf of the Partnership. Notary Publ a THIS INSTRUMENT WAS DRAFTED BY: BARNA, GUZY & STEFFEN, LTD. 400 Northtown Financial Plaza 200 Coon Rapids Boulevard Minneapolis, MN 55433 (612) 780-8500 . (MPH) -5- FROM • 5. 6. 1993 13:41 BARNA BUZY P. 4.9 EXHIBIT A LEASEHOLD PROPERTY Lot 15 andthat part of Lot $s" Plaza Center,allnoka County, 7, Block 1, Fridley of the following describe Minnesota, lying Commencing at tsthe northwest corner of Lot 14, Isaid Block 1; thence North 89 degrees 58 minutes 45 seconds East, along the north line of said Lot 14, a distance of 13.00 feet, to the point of beginning of the line to be described; thence North 0 degrees 47 minutes 15 seconds East a distance of 213. 23 feet to a point on the line common to Lots 6 and 7, said Block 1, said point being 3. 00 feet westerly from the southeasterly corner of said Lot 6, and said line there terminating. -6- 612 780 1777 FROM BARNA GUZY 5. 6. 1993 13:41 P. 8 4.10 EXHIBIT B REDEVELOPER PROPERTY Lot 14, Block 1, Fridley Plaza center, according to the recorded plat thereof, and situate in Anoka County, Minnesota, -7- FROM BARNA SUZY { +. 6.1993 13:42 P 4.11 . 9 EXBIBIT C OPTION ARCM To be determined. -8 I. • • _ FROM 5. 6.1993 13:42 BARNA 6UZY P. 9 4.11 EXHIBIT C OPTION PARCEL To be determined. • -e- . , 4 . __________-.....==== =MINIIIIIIIIIMM 5.1 :${\:ii'::v::j''v'.:}':. 4:•-tif'(:i$i?C$isi$ii':i::i:}^is�?i:$$isiiv'::$i}::::i:::: ::Ji:Yv$:ti:${{��$iiii:$::u'fi:?Fi:}:}iv.�..��?'�$$i'.::::iiv�:}i'::::i{$$::i:"L:ii$~�$}�;iij:vi:Y.::L:i:-iii::;F;ii-:.::}:i;iT::}$$:v:::::$: .fi :i$ffi$iY:• ............ t.-t.t•a::.........:�::>::::::..}:.}:`.}:.,::::a};.. ,.,a:r{::..:v f r:r,.u.........:r.•::.�: ...................... ......................:.............:.......... .o.' ....... ............................ ............... ............ 2.n..;.. f. ,,t•..:::::::.....-"--.........................-r:::::::::::::::is}-•i:{•}::.}:.}i:.:�.�• ..... ............ .................................... .................:.....................................r....::......... r.n...}.::.:.:::.::;tt•::}:..:..nn.••„•.{;:.:�..:::::::::::::::::.�::::.�:::.�::r::.�:.t.::......,..;.......rr::if.::•.Yf-: ....:::............. .........................w:::n:v:v;...................,, ............... ........... ............::::n.........::v./ .%v}}}::}::::v::::::::::::::v:::::.v:.v::::::::::............::::::::::::::v::...............n..:.}/.}.;{.;....x:�f.'..::::::. t•F•...;n.; ..tv ..i}}}}}}}}i}}}})i:-i}iiii}:a}}}v.vi.'nw;w::a}}}}:v:•Yf v•...... •.•••.. ......::........:•,v:....-.n...:n.:.'..:::..v....... ..........xv.-...........:{w.v:.v:::.:�:.::v::.v::;,vf.•iv.a..:::::.......::.: A' ...:::. .. ..•:./'::.t:.}%: .... ...................... ........nt$}r,........t:....Y...:.}Y ::::::::::.Y.:a ... .:. f..:v-.+.:•}.v:}.{{w ............:..t:^'•::y'•}'G:�i}:::::ni}:':::::.v:::.vv.:}}:�}:•:i:,v.;.. xv/•: r •.:{ 1 y}:.}:•}}:ti?{:n.:v}}.vvv}.:.::::{.:av::}}}}:!!.}}}}:}}}:n n?.}.:v}+}}$i:n-•}n..:-..::. v::/.}:-}::.tiCa\n{� -v5w:::::::::•:•w:::.v:.v:: t'v'4 rr.{:•:v.•}}}T.t"I :•:fi b} }:::'ti j$:vn.............::. rr r. 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Yty}':4}'':'+{�d�Y.}ai}}}:-i:v^u:}r'. •%:i{:::}�?f::;i:{:.r.;::• f . :•Y�Yf .tsficr..#�'�,�v}.,;:{i6.?.}:u`;S#:}'s:$:3:::v:},'•. :.:o} 'c x:}•{ :t,;:fw:::}}w:}:a•:_rw:::::-}:{v::n+-y;}Y{'> t`•.'• tn.v.{},tf, ....•+.•:C{C}t#,...:::C.:+}y,:{:\::f{:::v;ti:?{?::5\::'.•.'..}.t• , + }iv?C,i:i.• .. r{..v:::.•: :.. >y:::#.:::#:ivt...r{,3.. :4\.:hv:n}::::i....:...:.::.v.:v:::::::v....?"fr'g:.-yr:'S.,...A i::ti..+•?af'':Y .•::: ..}r.:.\......::.......:.::::;::::::::::::::::}}};:}r{:t;}Fa.�.•}Y.:.':..v�.�GM r:�tvv,..' yr�Il��i'•.�+••-•.�i•}"'4.•.•'.::: }:n+�.{iii:}}::ty:}$}v::ti.}'}.v.{{{ •:.{a`..•...•..... ..:+-: :r..::.:::}::x::::::}yi}#:. n.}.v,•nv:::::::::.t.t..nn:v:vn•:{ f..vvx.•�•i�'SO�ivy'•xt• •• TO: WILLIAM W. BURNS, CITY MANAGER 4I FROM: RICHARD D. PRIBYL, FINANCE DIRECTOR SUBJECT: RESOLUTION DESIGNATING OFFICIAL DEPOSITORIES DATE: May 6, 1993 Attached you will find the resolution that ordinarily is placed on the agenda the first meeting of January. Due to an oversight we did not prepare this resolution for the HRA until recently. This resolution assigns the Fridley State Bank as the Official Depository for the HRA. The resolution also provides that the City Manager, Finance Director and the Assistant Finance Director as the official signers for the HRA checks. RDP/me Attachment 5.2 RESOLUTION Imo. BRA 2 - 1993 RESOLUTION DESIGNATING OFFICIAL DEPOSITORIES FOR THE FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY IT IS HEREBY RESOLVED that the Fridley State Bank is hereby designated as a depository for the funds of this corporation. IT IS FURTHER RESOLVED that checks, drafts or other withdrawal orders issued against the funds of this corporation on deposit with said bank shall be signed by two of the following: Richard D. Pribyl, Finance Director-Treasurer William W. Burns, Executive Director/City Manager Howard D. Koolick, Assistant Finance Director and that said bank is hereby fully authorized to pay and charge to the account of this corporation any checks, drafts, or other withdrawal orders. BE IT FURTHER RESOLVED that all transactions, if any, relating to deposits, withdrawals, re-discounts and borrowings by or on behalf of this corporation with said bank prior to the adoption of this resolution be, and the same hereby are, in all things ratified, approved and confirmed. BE IT FURTHER RESOLVED that any bank or savings and loan may be used as depositories for investment purpoocs so long as the investments amply with authorized investments as set forth in Minnesota Statutes. BE IT FURTHER RESOLVED that the signatures of two of the following named City employees are required for withdrawal of HRA investment funds fran savings and loan associations: Richard D. Pribyl, Finance Director-Treasurer William W. Burns, Executive Director/City Mgr. Howard D. Koolick, Assistant Finance Director BE IT FURTHER RESOLVED that any brokerage firm may be used as a depository for investment purposes so long as the investments comply with the authorized investments as set forth in Minnesota Statutes. PASSED AND ADOYI BY THE HOUSING AND REDEVELDPmENT AUTHORITY OF THE CITY OF FRIDLEY THIS 13TH OF MAY, 1993. LAWRENCE R. COMMERS, CHAIRMAN ATTEST: WILLIAM W. BURNS EXECUTIVE DIRECTOR 7.1 11' / Community Development Department \ HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: May 5, 1993 TO: William Burns, Executive Director of HRA410 4 FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Status Report on HRA Housing Rehab Programs This is to provide an update on the status of the various housing rehab programs. CDBG Home Improvement Grant Program For the past couple of weeks Grant has been preparing an administrative plan for this program. To date, he has identified the major implementation tasks and received approval from Anoka County to split administrative responsibilities between the HRA and ACCAP. On May 5th, Grant sent a letter to Patrick McFarland of ACCAP soliciting their involvement to jointly administer the program. Hopefully by the end of the week we can schedule a meeting with ACCAP to discuss our ideas and begin negotiations on the matter. If all goes well we could begin taking applications by mid June. HOME Rehab Grant Program Funding for this program won't be available until later this year, possibly not even until this fall. However, we have made a revision to the income guidelines for the program. In the original application sent to HUD, we stated that we would use the rules of the existing rehab grant (i.e. CDBG) program. As you are aware, the income guidelines for the CDBG program are extremely low and exclude many homeowners who potentially won't qualify for a loan. In an effort to assist these individuals, we have raised the income guidelines to 50% of area median income as published by HUD. A comparison of the income guidelines is shown on the next page. . . ....... .. .. .. 7.2 Memo to William Burns May 5, 1993 - Page 2 Household Size Old Limit New Limit 1 $9, 668 $17,350 2 $12, 644 $19,850 3 $15,620 $22, 300 4 $18,832 $24,800 5 $22 , 044 $26,800 6 $25,260 $28,750 7 $28,472 $30,750 8 $31, 684 $32,750 Because we will be using the same delivery method as the Home Improvement Grant Program (i.e. joint administration with ACCAP) , we will already have the procedures in place to begin taking applications by the time HOME funds become available. As a result, we shouldn't have any additional delays in starting the program. As with the CDBG program, we plan on conducting a pre-screening process to ensure that funds are directed to those most in need. MHFA Home Improvement Loan Program Also over the past several weeks, Grant has been reviewing the HRA plan to provide so called "gap" financing to be used in conjunction with the MHFA Home Improvement Loan Program. As you are aware, several changes have been suggested by Grant on the use of HRA funds. Originally, the concept was to assist those borrowers who couldn't qualify for all of the necessary financing through the bank. In looking at this plan more closely, several issues came up. Based on experience, it appears that someone would fall into the gap for one of two reasons: 1. High debt load 2. Lack of equity Under most other circumstances (i.e. bad credit, ineligible improvements, over-income, etc. ) the applicant would be rejected and unable to secure any type of MHFA loan financing. Looking at this issue from a practical perspective, the following questions were raised: 1. Is it fair to assist what is essentially a small group of people, many of whom are marginal or even poor credit risks (for whatever reason) ? 7.3 Memo to William Burns May 5, 1993 - Page 3 2. Is the subsidy level too high, thereby concentrating HRA resources in fewer households and effectively reducing its ability to assist as many people as possible? In addi- tion, there is also greater risk to the HRA in the event of borrower default. 3 . Are we losing control of the process by allowing the bank to decide which applicants fall into the "gap"? As an alternative to this approach, Grant suggested a program which would utilize HRA funds to reduce the principal amount of loans for eligible borrowers. The concept would be to 1) encourage people to make improvements to their homes, 2) assist those who qualify for a loan (i.e. good credit risk) , 3) maximize HRA dollars by reducing the subsidy level, and 4) reduce risk to HRA funds. Applications would be pre-screened and scored using the point system discussed previously. Once scored, the applications would be forwarded to the Fridley State Bank (FSB) for loan processing. FSB would notify the HRA of the eligible borrowers as each application is processed. Those who qualify for an MHFA loan, would receive a reduction in principal as outlined below: Loan Percentage Maximum Maximum Number Amount Reduction Assistance of Loans @ This Level Less than $5, 000 10% $500 120 $5,001 to $10, 000 12.5% $1,250 48 $10, 001 to $15,000 15% $2,250 26 The actual savings to the borrower could even be greater due to the reduction in finance costs (assuming no pre-payment) . The HRA assistance would be provided in the form of a grant; co- terminus with the MHFA loan. If the homeowner remains in the home, the HRA assistance would not have to be repaid. If on the other hand, the owner sells or refinances (at which time the MHFA loan would have to paid off) , the HRA grant would be repaid. The amount to be repaid would be in proportion to the outstanding balance on the MHFA loan. Assuming we receive HRA concurrence on the plan, we could offer the program at the same time we take applications for the CDBG program; hopefully some time in mid-June. The next step would be to formalize the procedures and finalize written details with FSB. 7.4 Memo to William Burns May 5, 1993 - Page 4 Fannie Mae Program On April 30, 1993 Grant met with Fay Wegner of Miller & Schroeder Financial, Inc. to discuss the Fannie Program. At the meeting Fay reviewed the program, various lender requirements, and an overview of the underwriting process. After discussing the specifics the HRA program, Fay indicated she would prepare a sample mortgage origination agreement for our attorney's review. The agreement would be used by the HRA and lender to outline the responsibilities of each party. One issue which has come up in subsequent discussions concerns whether certain improvements, such as a deck or fireplace could be financed under our program, assuming the improvements are a part of a larger project to upgrade the property. An example which came to mind was someone expanding a kitchen or family room which may include one of the improvements mentioned above. Although these items were previously declared ineligible, it would be important to know if these improvements would be allowed as part of the larger project. Unless otherwise directed, we will not allow these items as eligible expenses. Fay also stated that Norwest and United Mortgage expressed interest in participating in the program. Assuming the agreement is acceptable, we could probably have the program in place and ready for applications by late June or early July. HRA Reserve Fund As we discussed at our meeting on May 3rd, there are several concerns over this program. Potential candidates for this pool are identified below: Home Improvement Loan Home Improvement Grant - Over income (more than $41, 000) - Over income based on guide- lines for family size. - Bad credit (late payments, a bankruptcy, unsatisfied judge- - Owner occupied triplex. ments or liens) . or fourplex. - High debt load - Home occupation which exceeds 15% of floor area. - Home occupation which exceeds 15% of floor area. - Assets exceed $25,000 - Lack of equity in home. • 7.5 Memo to William Burns May 5, 1993 - Page 5 - Ineligible improvement/s There are also issues such as what happens when the property is purchased on a contract for deed and the vendor is unwilling to sign the mortgage or lien agreement; how do we determine feasibility of rehabbing a severely distressed or substandard property? We would like to leave program requirements for this fund flexible until we have a better idea of who may fall into this category after the first round of applications. MHFA Rental Rehab Loan Program As we discussed at our meeting on May 3rd, the same type of questions came up after evaluating the HRA's original plan to provide "gap" financing". Since it is anticipated that only a small percentage of applicants would fall into a financing gap, the alternative would be to encourage more owners to improve their properties through an incentive-based approach. The most workable solution appears to a principal reduction program similar to that proposed for the home improvement loan program. Any owner who would qualify for a loan through the program, could have the principal amount of their loan reduced by 10%. The actual reduction would depend on the number of units in the building. Projected No. MHFA Maximum Maximum of Loans @ Loan Amount Reduction this Amount Single-Unit $15, 000 $1,500 73 Building Multi-Unit Lesser of $8, 000 $4, 000 27 Building per unit or $40, 000 per bldg. The HRA assistance would be co-terminus with the loan; it would only have to be repaid in the event the owner sold the property prior paying off the MHFA loan. Again, the HRA assistance would be repaid in the proportion to balance outstanding on the MHFA loan. If the plan is acceptable to the HRA Board, we could approach Fridley State Bank and MHFA with the proposal. I would expect program implementation by early to mid June. M-93-257 M . 1 8.1 a al Ln o }, S r S S a) r Q'• gNCNo82 r 0:. C") lA N. t0 a H N u_ a> r 06 C 0 O r as 6; O ', Y "' O r `O 5 co.21 o y O vi O Y 047) < N r `n ce ,32:*: $ a68Sti I rci . o r o , � zi Lt< `n � � tiN P w J `> N I-- a i c O gii (0 (h LA i5 0, x CI) S S Tr ES u) of : 28O a) F: u> rn ate: N- ti4r0 o 'al z, r 0 N O N v N O a ' m Y ;.: a O coN N to t !Q 8 C'J O Q Q O os cCM .y V V Cr) co aJ 3 'd ... a ) r Ill ") bid ii) fA w U — as as Ca aUuw ~ (0 C p 0O a> :? C a H U H S ige: 8 p 8 03 a) a) Y 0 t 'd 4 Y Z � O O r aj aj p °aC o p p« Q cm V F a,a7: n Nid o C p a) Cca> >:: 11 U r r C .CU. O O U �. U c = U a I I WO :':;:z:::` L Lu ?>ib W -a (n F— g .a . .. o 13 :. zOzw p cc W , � 9ZZ � 0E— � _ 0 = OZ � ¢ O >- H LAKE POINTE DEVELOPMENT MAINTENANCE PROJECT NO. 244 PROPOSAL FOR 9.1 • LAKE POINTE DEVELOPMENT MAINTENANCE PROJECT NO. 244 Proposal of: �.,...SAAC,so1C'`S Lilco '�- ibs me0- Roi lit, Street Address .0�+rs, r1 n. 55 Y)'4 City, State Zip Code To furnish and deliver all materials and to do and perform all work, in accordance with the r contract and specifications on file in the office of the Public Works Director and the "Special 111 Provisions" contained herein for: . LAKE POINTE DEVELOPMENT MAINTENANCE PROJECT NO. 244 i . BA SE BID i (Mowing, lawn fertilizing, cleanup, etc., as spelled out in the specifications) $ al 3,11 i .°o-- i ALTERNATE A i Tree Pruning and Wrapping $ 50 o. 3 ALTERNATE B Tree Fertilization for Deciduous and Conifers . $ 3 50. c o (Alternate B bid is based on - ( ) liquid ( ) dry fertilizing) i TOTAL BID (BASE BID + A + B) $ ay /70 o0 (figures) . $ /S/n 11 4 4 .sArld , On.( Aur)d rea a td Y-4)r'eo do ii€- - TOTAL BID (BASE BID + A + B) WRITTEN IN WORDS I 22 L. I 10. ■ Community Development Department • r \ HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: may a, iyys TO: William Burns, Executive Director of HRA FROM: Barbara. Dacy, Community Development Director SUBJECT: Follow-up on Taxes for HRA Property The HRA inquired about the increase in taxes for HRA-owned property in the southwest quadrant. I have attached the property tax state- ments for 1993. The values have remained the same for each property; however, the tax increase is as a result of the recent school referendum for School District #14. If you need further information, please let me know. BD:ls M-93-258 Edward M.Treska,Division Manager. 0 Properly Records and Taxation ANOKA COUNTY ANOKA COUNTY 2100 3r0 Avenue STATEMENT OF PROPERTY TAXES PAYABLE IN 1993 MN..MN 55303 323-5400 - PROPERTY DESCRIPTION Aare) OWNER FRIDLEY H R A THAT PRT OF LOTS 4 THRU 11 6431 UNIVERSITY AVE NE INC BLK 12 LOWELL ADD TO FRIDLEY, MN 55432 FRIDLEY PARK DESC AS FOL: 1/G I1/1 (d Ss Property Class: COMM-IND COMM-IND / New improvements N/A 0 1 Market Value: 114400 114400 1. Use this amount on Form M-1 PR to see if you are eligible for a property ► tax refund.File by August 15.If box is checked,you owe delinquent taxes and are not eligible ED 0.00 2. Use this amount for the special property tax refund on schedule 1 of Form M-1PR 0.00 YOUR PROPERTY TAX And How It is Reduced By The State 3.Your property tax before reduction by state paid aids and credits 7555.83 7699.03 44"---"" 4.Aid paid by the State of Minnesota to reduce your property tax 3298.36 3264.77 5.Credits paid by the State of Minnesota to reduce your property tax: A.Homestead and agricultural credit 0.00 0.00 B.Agricultural Preserve Credit 0.00- 0.00 6.Your property tax after reduction by state paid credits 4257.47 44.34.26 WHERE YOUR PROPERTY TAX DOLLARS GO 7.County 0.00 0.00 8.City or town 0.00 0.00 9.School district 0.00 0.00 10.Special taxing districts 0.00 0.00 10A.Tax Increment 3093.88 2923.41 10B. Fiscal Disparity Tax 1163.59 1390.47 11.Voter approved Referenda Levies 0.00 120.3814=8 -• 12.Total property taxes before special assessments 4257.47 4434.26 13.Special assessments added to this tax bill 0.00 0.00 14.Your total property tax and special assessments 4257.47 4434.26 15.Pay this amount no later than May 15, 1993 2217.13 -- 16.Pay this amount no later than October 15, 1993 . . 2217.13 3 SEoDND 1 ALFMA1t. P 7P l Y sV Ajk RS1"i'i $3 'tlfn I�PhYMr Ni �payaBla 9 ttETti 85 � NN31'tftS�TtJF31Nt#�I+.li;1(tuli �r. :,�,,� .� TO AVOID PENALTY,PAY ON OR BEFORE OCT 15 TO AVOID PENALTY,PAY ON OR BEFORE MAY 15 PLEASE INCLUDE PIN NUMBER ON CHECK PLEASE INCLUDE PIN NUMBER ON CHECK PIN: R14 30 24 32 0001 NA PIN: R14 30 24 32 0001 NA MAKE CHECKS PAYABLE TO: ANOKA COUNTY MAKE CHECKS PAYABLE TO. ANOKA COUNTY 2100 3rd Avenue,Anoka.MN 55303 2100 3rd Avenue,Anoka,MN 55303 PAY THIS AMOUNT 2217.13 PAY THIS AMOUNT 2217.13 FRIDLEY H R A FRIDLEY H R A 6431 UNIVERSITY AVE NE 6431 UNIVERSITY AVE NE FRIDLEY, MN 55432 FRIDLEY, MN 55432 004994732000221713 004994731000221713 00499473F000443426 ANOKA COUNTY PAYABLE 1993 STATE PAID PROPERTY TAX REFUND INFORMATION 1992 1993 Owner: FRIDLEY H R A PIN: R14 30 24 32 0001 6490 UNIVERSITY NE Market Value: 114400 114400 FRIDLEY, MN 55432 New Construction Value: N/A 0 Property class: Taxpayer: COMM-IND COMM-IND FRIDLEY H R A 6431 UNIVERSITY AVE NE FRIDLEY,MN 55432 Line 1 Amount to use in filling out your property tax refund form M-1PR,if eligible 0.00 Line 2 Amount to use in filling out schedule 1 of form M-1PR,if eligible 0.00 If this box Is checked,you owe delinquent taxes riDetach this stub and Include it with your M-IPR form when applying for a refund PROPERT1GVALlL47 t+�1: .,,A. � ft„AF f�fl9.,a PIN: R14 30 24 32 0001 . 1993 MKT/VAL PAY 1994 114,400 City: FRIDLEY Property Class: COMM-IND LOCAL BOARD OF REVIEW FRIDLEY H R A FRIDLEY CIVIC CENTER COUNTY ASSESSOR 323 5479 6490 UNIVERSITY NE • APRIL 05,1993 AT 7:30 PM COUNTY BD. OF EQUALIZATION FRIDLEY, MN 55432 TO APPEAR CALL LOCAL ASSR. ANOKA COUNTY GOV. CENTER AT 571 3450 JUNE 17,1993 AT 9:00 AM T1VOHzA1---22004503 ANOKA COUNTY Edward M.cord a,orvi5wn Manager, Property Records and Taxation STATEMENT OF PROPERTY TAXES PAYABLE IN 1993 MN 3032323a5Avenue 400 10.3 PROPERTY DESCRIPTION OWNER .. oowsz"•a .. . .:. T1 FRIDLEY HRA SYLVAN HILLS PLAT 7 4 6431 UNIV AVE NE LOT 1 FPRIDLEY(,//�MN 55432 BLOCK 1 {) r�il ic, "L Property Class: COMM-IND COMM-IND l New improvements N/A 0 Market Value: 579600 579600 1.Use this amount on Form M-1 PR to see if you are eligible for a property • f • tax refund. File by August 15.If box is checked,you owe delinquent taxes and are not eligible ED 2.Use this amount for the special property tax refund on schedule 1 of Form 0.00 M-1PR YOUR PROPERTY TAX AndHowItIsReducedB TheState 0.00 3.Your property tax before reduction by state paid aids and credits 4.Aid paid by the State of Minnesota to reduce your property tax 22559.43 22677.60 1�----� 5.Credits paid by the State of Minnesota to reduce your property tax: 22559.43 22677.60 A. Homestead and agricultural credit B.Agricultural Preserve Credit 0.00 0.00 6.Your property tax after reduction by state paid credits 0.00 0.00 WHERE YOUR PROPERTY TAX DOLLARS GO 29II9.37 30bi4.b8 7.County 8.City or town 0.00 0.00 9.School district 0.00 0.00 10.Special taxing districts 0.00 0.00 10A.Tax Increment 0.00 0.00 10B. Fiscal Disparity Tax 21162.35 20310.38 11.Voter approved Referenda Levies 7957.02 9654.29 12.Total property taxes before special assessments 0.00 574.58� 13.Special assessments added to this tax bill 29119.37 30574,58 14.Your total property tax and special assessments 0.00 4.58 15.Pay this amount no later than May 15, 1993 29119.37 30574.58 - 16.Pay this amount no later than October 15, 1993 15287.29 $ECOND �n Bea satatetaxes 15287 29 T" ,,. ',, y 4Bhls larr 2 FiRST• re' Ar4 z Aaatestafi►tax 't F114alf rS V .R PLEt c�,isab 5 :AE1#04:C .. 4 s pae a,199 '� TO AVOID PENALTY,PAY ON OR BEFORE OCT 15 TO AVOID PENALY,AY ON OR BEFORE MAY 15 PLEASE INCLUDE PIN NUMBER ON CHECK PLEASE INCLUDE PIN NUMBER ON CHECK PIN: R14 30 24 32 0058 NA PIN: MAKE CHECKS PAYABLE TO: ANOKA COUNTY RA 4 24 00 UN NA 2100 3rd Avenue,Anoka,MN 55303 MAKE CHECKS PAYABLEE T TO: ANOKA COUNTY 2100 3rd Avenue,Anoka,MN 55303 PAY THIS AMOUNT 15287.29 PAY THIS AMOUNT 15287.29 FRIDLEY HRA FRIDLEY HRA 6431 UNIV AVE NE 6431 UNIV AVE NE FRIDLEY, MN 55432 FRIDLEY, MN 55432 005381902001528729 005381901001528729 00538190F003057458 ANOKA COUNTY PAYABLE 1993 STATE PAID PROPERTY TAX REFUND INFORMATION 1992 1993 Owner: FRIDLEY HRA PIN: R14 30 24 32 0058 6431 Market Value: 579600 FRIDL UNIVERSITY, MN4 AVE NE 579600 New Construction Value: FRIDLEY MN 55432 N/A 0 Property class: Taxpayer: COMM-IND COMM-IND FRIDLEY HRA 6431 UNIV AVE NE FRIDLEY,MN 55432 Line 1 Amount to use in filling out your property tax refund form M-1PR,if eligible 0.00 Line 2 Amount to use in filling out schedule 1 of form M-1PR,if eligible 0.00 If this box is checked,you owe delinquent taxes n Detach this stub and Include It with your ROPS IYSI M-1PR tone when applying fora refund ^ P 'p ;Rt: , :gx`.IANUA & t 3 PIN: R14 30 24 32 0058 1993 MKT/VAL PAY 1994 579,600 City: FRIDLEY LOCAL BOARD OF REVIEW Property Class: COMM-IND E FRIDLEY CIVIC CENTER COUNTY ASSESSOR 323 5479 06431 UNI ERSITY AVE NE APRIL 05,1993 AT 7:30 PM COUNTY BD. OF EQUALIZATION FRIDLEY, MN 55432 TO APPEAR CALL LOCAL ASSR. ANOKA COUNTY GOV. CENTER AT 571 3450 JUNE 17,1993 AT 9:00 AM TIVOIZAI---Z2004507 Edward M.Treska,Division Manager. ANOKA COUNTY Propeny xatten ANOKACou�s o03 Avenue 10.4 j STATEMENT OF PROPERTY TAXES PAYABLE IN 1993 Anoka.MN 55303 323-5400 - e "' ---:',t s vo y , PROPERTY DESCRIPTION OWNER FRIDLEY CITY OF HRA SYLVAN HILLS PLAT 5 6431 UNIVERSITY AVE NE CITY OF FRIDLEY t FRIDLEY, MN 55432 E 75.1 FT OF N 158 FT OF 1"1 � f!, ,., 4 • 0 A Property Class: COMM I ND COMM I ND 4f.1 New improvements N/A 0 1`�1V Market Value: 69200 69200 1.Use this amount on Form M-1 PR to see if you are eligible for a property S tax refund.File by August 15.If box is checked,you owe delinquent taxes and are not eligible = 0.00 2.Use this amount for the special property tax refund on schedule 1 of Form M-1PR 0.00 YOUR PROPERTY TAX And How It Is Reduced By The State 3.Your property tax before reduction by state paid aids and credits 4283.11 4351.61 411(------+ 4.Aid paid by the State of Minnesota to reduce your property tax 1869.71 1843.26 5.Credits paid by the State of Minnesota to reduce your property tax: A.Homestead and agricultural credit 0.00 0.00 B.Agricultural Preserve Credit 0.00 0.00 6.Your property tax after reduction by state paid credits 2413.40 25Ud..i5 WHERE YOUR PROPERTY TAX DOLLARS GO 7.County 0.00 0.00 8.City or town 0.00 0.00 9.School district 0.00 0.00 10.Special taxing districts 0.00 0.00 10A.Tax Increment 1753.80 1651.38 10B.Fiscal Disparity Tax 659.60 784.15 11.Voter approved Referenda Levies 0.00 72.82 12.Total property taxes before special assessments 2413.40 2508.35 13.Special assessments added to this tax bill 0.00 0.00 14.Your total property tax and special assessments 2413.40 2508.35 15.Pay this amount no later than May 15, 1993 1254.18 - 16.Pay this amount no later than October 15, 1993 1254.17 afi rs 3`x RS..w--•E�•:-, - Rea/er#1114 axles SECOND'fiAt� A �Z3 � �W estate taxer paya4u r988 RETURN.THtS RWfTHP 1i MBMT RE URN t STU5WITHPAYMENT s„ .., • TO AVOID PENALTY,PAY ON OR BEFORE OCT 15 TO AVOID PENALTY,PAY ON OR BEFORE MAY 15 PLEASE INCLUDE PIN NUMBER ON CHECK PLEASE INCLUDE PIN NUMBER ON CHECK PIN: R14 30 24 32 0051 NA PIN: R14 30 24 32 0051 NA - MAKE CHECKS PAYABLE TO: ANOKA COUNTY MAKE CHECKS PAYABLE TO: ANOKA COUNTY 2100 3rd Avenue,Anoka,MN 55303 2100 3rd Avenue,Anoka,MN 55303 PAY THIS AMOUNT 1254.17 PAY THIS AMOUNT 1254.18 FRIDLEY CITY OF HRA FRIDLEY CITY OF HRA 6431 UNIVERSITY AVE NE 6431 UNIVERSITY AVE NE FRIDLEY, MN 55432 FRIDLEY, MN 55432 005381272000125417 005381271000125418 00538127F000250835 ANOKA COUNTY PAYABLE 1993 STATE PAID PROPERTY TAX REFUND INFORMATION 1992 1993 Owner: FRIDLEY CITY OF HRA ' PIN: R14 30 24 32 0051 6401 UNIVERSITY AVE NE Market Value: 69200 69200 FRIDLEY, MN 55432 New Construction Value: N/A 0 Property class: Taxpayer: COMM-IND COMM-IND FRIDLEY CITY OF HRA 6431 UNIVERSITY AVE NE FRIDLEY,MN 55432 Line 1 Amount to use in filling out your property tax 0.00 refund form M-1PR,if eligible 0.00 Line 2 Amount to use in filling out schedule 1 of form M-1 PR,if eligible a If this box is checked,you owe delinquent taxes Detach this stub and include It with your At-IPR form when applying fora refund PROPERTY YAt�' f3�"�7TPE�8.�3�AN�AF�C�� ,.,.. ,. PIN: R14 30 24 32 0051 1993 MKT/VAL PAY 1994 69,200 City. FRIDLEY Property Class: COMM-IND LOCAL BOARD OF REVIEW FRIDLEY CITY OF HRA FRIDLEY CIVIC CENTER COUNTY ASSESSOR 323 5479 6401 UNIVERSITY AVE NE APRIL 05,1993 AT 7:30 PM COUNTY BD. OF EQUALIZATION FRIDLEY, MN 55432 TO APPEAR CALL LOCAL ASSR. ANOKA COUNTY GOV. CENTER AT 571 3450 JUNE 17,1993 AT 9:00 AM T1vn1ZA1---710O1506 11.1 U Community Development Department PLANNING DIVISION City of Fridley DATE: April 28, 1993 TO: Jim Froehle FROM: VBarbara Dacy SUBJECT: Summer Newsletter My staff has reviewed your list of proposed topics for the Summer Newsletter. To follow is a list of our suggestions. 1. HRA 1992 Annual Report. A. Feature on Grant Fernelius, new Housing Coordinator, including his picture. B. Brief update on housing programs; possible introduction of the "Fannie Mae" mortgage program. C. Feature on Sheet Metal Connector industry and site. D. Mississippi Street reconstruction. E. Update on McGlynn Bakeries' rehabilitation. F. Possible update on Northeast Quadrant redevelopment. 2. Curbside recycling reminder signs available through Lisa Campbell. Maybe we can get together on Wednesday, May 5, 1993 and work together on the articles. Thank you! BD/dn r APR 30 1993 '��" HealthPartners HealthPartners ��Q 2829 University Avenue Southeast Minneapolis,Minnesota 55414 612-623-8400 ri April 28, 1993 Mr. William W. Burns City Manager Fridley Municipal Center 6431 University Avenue N.E. - Fridley, MN 55432 Dear Mr. Burns: Thank you for sending us the information about the "Southwest Quadrant" site. We have clinics in Spring Lake Park, Arden Hills and Brooklyn Center. At this time, I do not feel a clinic in Fridley would be benificial for HealthPartners. We will keep the information on file for future reference. Si el Ro ert S. 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Rkt2Riiilf23YrUasisisiaasisi;isi;ia:ia:xu�iaatxe>ex,t.:.;,:.:.asas 6.2 TO: FRIDLEY H.R.A FROM: CITY OF FRIDLEY RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES APRIL 1993 :.:::::::::Apt I ADMINISTRATIVE BILLING: ADMINISTRATIVE PERSONAL SERVICES 13,842.00 ADMINISTRATIVE OVERHEAD 250.00 TOTAL ADMINISTRATIVE BILLING : 460-0000-430-4330 14,092.00 OPERATING EXPENSES: POSTAGE BY PHONE POSTAGE 460-0000-430-4332 42.63 CITY OF FRIDLEY- 92 LANIER COPIER ALLOCATION 460-0000-208-0000 27.74 TOTAL OPERATING EXPENSES : 70.37 TOTAL EXPENDITURES - APRIL 1993 $ '4 :�62 37> File:\123DATA\HRA\TIF\93BILL.wk1 6.3 Ramman • • .-M•7 v 0 ow < m a2 ('I- I-2 K 0 Zip u u 1- u W 0 0 0 0 1/10. <2WF-ZN=�2<Z W= U 0' 0- �J1 a.ti o S In 00,-0Y�0w002�....E w .J... -YUU' Z 0Y0E>- tY Y•�•W22Y _Ju<c°C=u<<< W.. V)UU. 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