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HRA 07/08/1993 - 6334
HOUSING AND REDEVELOPMENT AUTHORITY MEETING THURSDAY, JULY 8, 1993 7:30 P.M. WILLIAM BURNS EXECUTIVE DIRECTOR OF HRA CITY OF FRIDLEY ,AGENDA HOUSING & REDEVELOPMENT AUTHORITY MEETING THURSDAY, JULY 8, 1993, 7:30 P.M. Location: Council Chambers Fridley Municipal Center CALL TO ORDER ROLL CALL APPROVAL OF MINUTES: May 20, 1993 ACTION ITEMS: MEMO ON REQUEST FOR ASSISTANCE FOR SPORTS SPREE IN MOORE LAKE COMMONS. . . . . . . . . 1.1 -1.13 CONSIDER RESOLUTION REGARDING HOME IMPROVEMENT LOAN PROGRAM . . . . . . . . . . . . . 2.1 -2.16 CONSIDER RESOLUTION REGARDING HOME MORTGAGE ASSISTANCE PROGRAM. . . . . . . . . . . . 3.1 -3.8 CONSIDER RESOLUTION REGARDING RENTAL REHABILITATION LOAN PROGRAM. . . . . . . . . . . 4.1 -4.16 CONSIDER RESOLUTION REGARDING CONTRACT INSPECTORS FOR HOUSING REHABILITATION PROGRAMS. . . . . 5.1 -5.09 RESOLUTION ADOPTING ICMA RETIREMENT CORPORATION AS THE DEFERRED COMPENSATION PLAN PROVIDER FOR THE FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY . . . . . . . 6.1 CLAIMSAND EXPENSES . . . . . . . . . . . . . . . . . . 7.1 -7.5 INFORMATION ITEMS: DISCUSS STATUS OF RICE PLAZA . . . . . . . . . . . . . . 8.1 -8.9 MEMO ON MULTI -TECH SYSTEMS INTEREST IN LAKE POINTE SITE . . . . . . . . . . . . . . 9.1 -9.7 MEMO ON STATUS OF ALL TEMP EXPANSION PROJECT. . . . . .10.1 -10.3 OTHER BUSINESS CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 20, 1993 CALL TO ORDER: MOTION by Mr. Prairie, seconded by Mr. McFarland, to nominate John Meyer as the Acting Chairperson for the meeting. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. Acting Chairperson Meyer called the May 20, 1993, Housing & Redevelopment Authority minutes to order at 7:30 p.m. ROLL CALL: Members Present: John Meyer, Duane Prairie, Jim McFarland Members Absent: Larry Commers, Virginia Schnabel Others Present: William Burns, Executive Director of HRA Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator Rick Pribyl, Finance Director Craig Ellestad, Accountant Jim Casserly, Consultant Jerome Meyers, Sheet Metal Connectors APPROVAL OF APRIL 8. 1993. HOUSING & REDEVELOPMENT AUTHORITY MINUTES• MOTION by Mr. McFarland, seconded by Mr. Prairie, to approve the April 8, 1993, Housing & Redevelopment Authority minutes as written. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 1. CONSIDER SUBORDINATION AGREEMENT FOR SHEET METAL CONNECTORS: Ms. Dacy stated that Sheet Metal Connectors is about to complete the SBA loan process for permanent financing of its new building on Main Street. She stated that presented for HRA action are two agreements. One agreement is between the HRA and Northeast State Bank which will have the primary mortgage. The second agreement is between the Coon Rapids Development Company which processes the SBA 504 loan and the HRA. The SBA loan will have a second position. _ _ HOUSING & REDEVELOPMENT_ AUTHORITY MEETING,_MAY 20. 1993 - PAGE 2 Ms. Dacy stated that Jim Casserly has reviewed the .documents and advised that they are in proper form and in compliance with the development agreement. MOTION by Mr. Prairie, seconded by Mr. McFarland, to approve the Subordination Agreements and authorize execution by the HRA=Chair- person and Executive Director. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 2. CONSIDER RESOLUTION TO AUTHORIZE PARTICIPATION IN MHFA MINNESOTA CITY PARTICIPATION PROGRAM: Mr. Fernelius stated that the First Time Homebuyer Mortgage application was prepared the week of April 12, 1993, in order to meet the April 15, 1993, deadline. The application requested $2,249,999 in mortgage revenue bond allocation for the City of Fridley. At the May 11, 1993, meeting, Fridley was allocated $1,161,000. He recommended that the HRA approve the resolution authorizing participation in the MHFA Minnesota City Participation Program and approve the application. Mr. Prairie asked if one -half of the request is the typical amount that is awarded to a community. Mr. Fernelius stated that MHFA has an allocation formula based on a variety of minimum floor scenarios. He stated that $73 million were requested, and the pool available was only $47 million. Mr. Meyer stated that in the future, he would like to know more specifics about the allocation process and how final amounts are determined. MOTION by Mr. McFarland, seconded by Mr. Prairie, to approve the application to the MHFA Minnesota City Participation Program and to approve Resolution No. HRA 1 - 1993, Resolution Authorizing Participation in the MHFA Minnesota City Participation Program. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 3. CONSIDERATION OF ADDITIONAL IMPROVEMENTS IN COOPERATION WITH MISSISSIPPI STREET IMPROVEMENT PROJECT: Ms. Dacy stated that there were three parts to this item. The first part deals with the traffic flow on the Rice Plaza property. Ms. Dacy showed a video depicting how the parking would function after the additional right -of -way has been removed from the front of Rice Plaza. She stated that a driveway needs to be constructed to the rear of Rice Plaza and the parking lot striped in accordance HOUSING _ &_REDEVELOPMENT AUTHORITY MEETING, MAY 20, 1993 - PAGE 3 with the site plan shown on page 3.5. She stated the estimated cost of the additional driveway work and striping would be about $5,000. She stated there is an adequate surplus in the Mississippi Street improvement project budget to accommodate this expenditure. Ms. Dacy stated that the tenants are concerned about the:-drive- through traffic for the Dairy Queen passing in front of the Rice Plaza building. She stated that in order to provide for safe traffic movements, the improvements are necessary. MOTION by Mr. McFarland, seconded by Mr. Prairie, to authorize staff to execute the necessary documents to complete the improvement as shown on the plan in the agenda packet. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. Ms. Dacy stated that the second part of this item is the landscaping replacement at the Target and Holly Center sites. She stated the vegetation at the Holly Center site would not have to be replaced. She stated that because of that, the requested amount of money to replace vegetation in the project has been reduced to about $6,000. Ms. Dacy showed a video identifying six evergreen trees, a variety of shrubs, and five Crabapple trees that need to be removed. She stated that the row of Winged Euonymous along the trash enclosure on Mississippi Street will be transplanted to the front part of the Target site instead of being replaced. MOTION by Mr. Prairie, seconded by Mr. McFarland, to authorize staff to execute contracts to transplant or replace vegetation as necessary at a cost not to exceed $6,000. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. Ms. Dacy stated that the third part of this item was the corridor landscaping improvements at the intersection. She stated that as part of the University Avenue corridor improvement plans completed in the mid- 1980's, landscaping was proposed at every intersection along University Avenue. During the Mississippi Street project review in 1991, Anoka County indicated that the HRA should be responsible for the installation. She stated that it is cheaper for the HRA to bid and to install the landscaping since the County contractor typically charges a percentage overhead in addition to the subcontractor costs. Mr. Meyer asked who would be responsible for the maintenance. He stated that he recalled that the City and HRA had a number, of questions about maintenance issues. HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 20, 1993_- PAGE —4 Ms. Dacy recommended that the HRA authorize her to take quotes on what it would cost for the landscaping at the intersection and determine whether or not it would be appropriate to have it installed this fall or wait until the next budget year. Ms. Dacy stated that she will determine who will be responsible for the maintenance of the landscaping and advise the HRA of that when it is discussed. MOTION by Mr. Prairie, seconded by Mr. McFarland, to authorize staff to solicit quotes for the intersection landscaping and schedule final action for the HRA in August or September 1993 and to include information about maintenance responsibilities. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 4. CONSIDER AMENDED LEASEHOLD AGREEMENT FOR FRIDLEY PLAZA OFFICE BUILDING PARKING LOT: Ms. Dacy stated that she wants the HRA to table action on this item. She stated that she was having trouble contacting the property manager regarding the snow plowing language and the time- - frame for the sealcoating. MOTION by Mr. Prairie, seconded by Mr. McFarland, to table the item until the June 10, 1993, HRA meeting. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 5. CONSIDER RESOLUTION DESIGNATING OFFICIAL DEPOSITORIES: Mr. Pribyl stated that this resolution defines the Fridley State Bank as the official depository for the HRA. The resolution also provides that the City Manager, Finance Director, and Assistant Finance Director are the official signers for the HRA checks. MOTION by Mr. Prairie, seconded by Mr. McFarland, to approve Resolution No. HRA 2 - 1993, Resolution Designating Official Depositories for the Fridley Housing and Redevelopment Authority. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 6. CLAIMS AND EXPENSES: Mr. Ellestad reviewed the expenses for the period from April 8 - 13, 1993. Mr. Ellestad also added check numbers 2343 through 2350. MOTION by Mr. McFarland, seconded by Mr. Prairie, to approve the claims and expenses and to issuance of checks, numbers 2304 - 2350. 1, n HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 20, 1993 - PAGE 5 UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 7. PROPOSED STYROTECH PROJECT AT 61ST AVENUE /MAIN STREET:_ Mr. Burns stated that he wanted to add this item to the HRA agenda. He stated he was contacted by Everest Development Group regarding an interest by Styrotech Company to locate a 100,000 square foot building at the vacant parcel on the west side of Main Street and 61st Avenue. He stated that 450 of the building would be manufacturing, 50o warehousing, and the remaining 5% would be office. He stated the company manufactures styrofoam products like the underlayment for roofing. He estimated market value of the project would be $3 million, and the estimated tax value would be $2,500,000. The Company is also looking at Brooklyn Park. Mr. Burns stated that Brooklyn Park's tax increment program offers a pay -as- you -go program in the amount of $426,000. He stated this was the present value amount. He stated that, given the City's current TIF guidelines, it would be difficult to compete with the Brooklyn Park offer. Mr. Casserly stated he had prepared a memorandum dated May 20, 1993, describing a potential assistance package. He stated the package consists of a $100,000 pay -as- you -go revenue note and an $150,000 loan. He noted that was based on the project value of $3 million. He believed the project value could substantially increase to $5 million after all building and equipment costs are included. Mr. Casserly stated that the Brooklyn Park district is an older district such that they .do not have to compensate for the loss of local government aids. He stated Brooklyn Park is specifically being aggressive with manufacturing companies. This company's hourly wage is reasonably high; and, because of its unusual processing techniques, it requires a skilled labor force. Mr. Burns stated the company would employ approximately 60 -70 employees. He stated the amount of truck traffic per day would be 20 -30 trips. Mr. Prairie stated that FMC is reducing its labor force. He believe the loss in manufacturing jobs is very high. He questioned if the HRA should go beyond its guidelines in order to attract this type of company. Mr. McFarland asked if there were any pollution problems relating to the company. HOUSING & REDEVELOPMENT AUTHORITY MEETING MAY 20. 1993 - PAGE 6 Mr. Burns stated he was not aware of any problems with the Everest Group, but they did say that the company is not a hazardous waste generator. Mr. Casserly stated that they are not making the styrofoam product at this site but merely forming and cutting the product. Mr. Burns suggested that if the HRA wanted to pursue this company, he suggested that the HRA direct staff to finalize the project costs and re- figure a potential assisted package. Further, he suggested that the additional assistance would have to be compared to the HRA's cash flow because of the recent prioritization of HRA monies for housing programs. MOTION by Mr. Prairie, seconded by Mr. McFarland, to authorize Jim Casserly to revise the proposal to Styrotech based on a $5 million project cost and to direct staff to investigate the impact of the proposal on the HRA tax increment cash flow. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 8. STATUS REPORT ON HRA HOUSING REHAB PROGRAMS: Mr. Fernelius updated the HRA on the CDBG program, the HOME program, the MHFA home improvement loan program (MHFA Fix -up Fund), the Fannie Mae program, the HRA reserve fund, and the MHFA Rental Rehab Loan program. Mr. Fernelius stated that the pre- screening applications would be taken beginning Monday, June 14, 1993, and the application period would be extended to July 16, 1993. He stated that he and Barbara Dacy had made a video newsletter; and they are preparing a half - page ad for the Fridley Focus, and an extensive article in the summer newsletter. Mr. Fernelius stated that regarding the CDBG program, a contract will be presented to the HRA board at its June meeting. He stated the County has raised the grant amount from $9,000 to $11,000. He stated it is proposed that Fridley's program would be consistent with the County's. Mr. Fernelius stated that regarding the federal HOME program, this money would probably not be available until this fall. He suggested that the HRA consider raising the income guidelines to 500 of the area media income as published by HUD. He stated this would provide more flexibility for program recipients. Mr. Fernelius described a new proposal for the MHFA HOME improvement loan program. He stated that when he came on board, he understood this program to be a "gap" financing program. He stated that while trying to implement this program, he had a number HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 20, 1993 - PAGE 7 of concerns about this approach. He stated that it may not be fair to assist a very small group of people, many of whom may be a poor credit risk. Secondly, the subsidy level of HRA funds would be focused into a small number of households, reducing the HRA's ability to assist as many people as possible. Further, there may be a greater risk to the HRA in the. event of the borrower default. Mr. Fernelius stated that in order to encourage people to make improvements to their homes, assist those who qualify for a loan, maximum the HRA dollars, and reduce the risk to HRA funds, he is proposing that the program be administered such that the HRA would provide a no interest deferred loan based on the following: Loan Percentage Maximum Maximum Number Amount Reduction Assistance of Loans @ This Level Less than $5,000 100 $500 120 $5,001 to $10,000 12.5% $1,250 48 $10,001 to $15,000 150 $2,250 26 Mr. Fernelius stated that staff has determined a new name to refer to the Fannie Mae financing program. The new program name is the HOME Mortgage Assistance Program. He stated that Fay Wegner will - be submitted origination agreements to be approved by the HRA at its June meeting. Mr. Fernelius stated that he is recommending that they not prepare specific guidelines for the reserve fund until the first round of applications has been reviewed and approved. After that time, we will know more about the types of applications which will fall through the funding cracks, and the HRA can determine on a case - by -case basis how to handle those situations. Mr. Fernelius stated that the Rental Rehab Loan Program would be administered in a similar fashion to the proposal outlined for the MHFA home improvement loan program. He stated he has been working more on the single family programs in order to get the pre- screening application process started, but this program would be available this summer as well. The HRA did not have specific questions of staff. 9. RICE PLAZA UPDATE: Ms. Dacy had nothing further to report about the monthly rent statement for Rice Plaza. 10. FOLLOW -UP ON LAKE POINTE BID INFORMATION: Ms. Dacy stated that Mr. Meyer had requested this information to determine the alternate A and alternate B bid requests. HOUSING & REDEVELOPMENT AUTHORITY MEETING. MAY 20, 1993 - PAGE 8 11. FOLLOW -UP ON TAXES FOR HRA PROPERTY: Ms. Dacy stated that Mr. Commers had requested this information. She stated she had provided copies of the tax statements for the HRA property at the southwest quadrant. The reason why the taxes increased was not because of an increase in the property valuation, but because of the school district referendum. 12. MEMO OF HRA ANNUAL REPORT FOR SUMMER NEWSLETTER: Ms. Dacy stated that the summer newsletter will contain the HRA annual report. Articles will include a feature on the housing programs with a picture of Grant Fernelius. Also, a picture and article will be published about the Sheet Metal Connectors property and Bob's Produce redevelopment project. Hopefully, a drawing of the Mississippi Street reconstruction will be included, as well as some pictures. Mr. Prairie asked whether or not information was going to be published about the Lake Pointe property. t Ms. Dacy stated she has been working with Mr. Froehle on this, and it would be possibly a picture of the site and a short paragraph - on the result of the joint HRA and City Council meeting on May 8, 1993. She stated she had not yet had a chance to review this item with Mr. Burns. 13. UPDATE ON FRIDLEY TOWNE SOUARE REDEVELOPMENT PROJECT: Mr. Casserly reported that Mr. Wagner has said he needs to work on the final details on their partnership agreement with Don Fitch. Further, the construction financing with the bank had not been finalized, but Mr. Wagner reported that he does have control of the three properties. Mr. Casserly stated that Mr. Wagner had to resubmit the application to Walgreen since there was a change in management position in Walgreen's corporate structure. ADJOURNMENT: MOTION by Mr. Prairie, seconded by Mr. McFarland, to adjourn the meeting. Upon a voice vote, all voting aye, Acting Chairperson Meyer declared the motion carried and the May 20, 1993, Housing & Redevelopment Authority meeting adjourned at 9:05 p.m. Respectfully submitted, Xt,kw-"�2� Lynbe Saba Recording Secretary 0 Ouslnee De"Wopment*8jD!YJ=q, Inc. TO: Barbara Macy, City of Fridley Fria ey, Mousing -and Redevelopment Authority FRt`?M "atrick Vy. Felstr*g :.Brll 6water Financial Group DATE:: :'7uly 2, 1993. RE: T uSpo t lSports Sprees I wanted to. provide a follow-up based upon our meeting this past Monday. to discuss the status of ;the. uSp s project.: We, are pleased to *report that we, `- ave reached' sin agreement for' financitg with. a local bank for :the NuSports project in Fridley. This•reduees' the total futtding "gapes m. approximately $80,000. As a result, .we would like to amend our request-ldf iitA loan �funding:to -W,000--'f e Al_raise the additional $30,000 in equ � Y want .to emphasize that the locatl6n of the project in Fridley is signific!M as; Qs:will 'be the first. of a chain *Of Sports Spree centers to be located throughout the. upper ,midweSt: p %d s of Sports -Spin expect that thu cordate headquarters will be located in Fridley as a, part of the Fridley. option..• initially,. the corporate staff is anticipated 'to be rdlativei'y ;modest fthree'.to five pule), but .over time, , the employment associ4ted with the : dorporate . headquarters is antictpat l-.W g vw .to between 15 to 25 people. The company, is anticipatir►g art initial. public stock'.ofciit .tn tnid to ;late 1994. .p recognize that this.loan kuest'is unique in terms of the types of assistance 'th0. using• and Re vel .pMe Authority typically provides. We feel; however, !hat, the'.advaritascs. to,the center .itself and the location . of the corporate headquarters .provide an attractive. �eab te. which will benefit this area and the city 'vf Fridley' greatly,. in *terins of recognition slid. joti- °creation. We,* for. # •to .the oppbituoity to review this exciting project with you. At your next HiiA Masting. i Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 7, 1993 TO: - William Burns, Executive Director of BRA FRDM: Barbara Dacy, Cammity Develaptnent Director SLMM l': Request for BRA Funding of Wetland Consultant Study 1�,..,�.. In the spring of 1992 during preparation of the City's 1993 General Fund budget, staff determined that it was necessary to hire a consultant to inventory the City's wetlands. The consultant contract is necessary because of the passage of the Wetland Conservation Act of 1991 by the State legislature. We also knew that some sites located in tax increment districts would be affected by this law. TWO, examples are the locpback parcel in the southeast corner of 73rd Avenue and University Avenue which was established as Tax Increment District No. 10 and properties in the vicinity of 81st Avenue and Main Street and now Tax Increment District No. 3. Because of the impact on potential developments in tax increment district parcels, it was discussed that the cost of the study could be divided between the Public Works Department and the housing & Redevelopment Authority. Request for proposals were mailed to six envircrmmental consultants last month, and four responded. The lowest cost and the best proposal was submitted by Westwood Professional Services, Inc. , and Peterson Envir mental Consulting, Inc. The contract cost is $7,990. Approximately two-thirds, or $6,000, will be paid through the City's General Fund. It is requested that the BRA authorize up to $1,990 from the "non - program studies" line item of the 1993 budget. The 1993 budget allocated $28,000 for non -programmed studies. Staff recommends that the BRA authorize an expenditure not to exceed $1,990 to be used for a portion of the wetland consultant contract with Westwood Professional Services and Peterson Environmental. BD:ls M -93 -402 Westwood Professional Services, Inc. June 29, 1993 14180 Trunk Hwy. 5 Eden Prairie, MN 55344 612 - 937 -5150 Ms. Michele McPherson, Planning Assistant FAX 612 - 937 -5822 City of Fridley Community Development Department 6431 University Avenue Fridley, Minnesota 55432 Re: Scope of Work and Cost Proposal: Fridley Wetland Delineation and Evaluation Dear Ms. McPherson: As we discussed on June 25, Westwood Professional Services, Inc. and Peterson Environmental Consulting, Inc. are pleased and excited that the City of Fridley has selected the Westwood - Peterson team to provide wetland delineation and evaluation services. The two primary project personnel will be Mr. Rob Bouta of Westwood Professional Services and Mr. Ron Peterson of Peterson Environmental Consulting. Mr. Bouta will be the project manager and the primary person from Westwood working on the project He will conduct the majority of field work and coordinate with Westwood's Engineering Department to oversee the production digitized wetland maps. Mr. Bouta's charge rate is $55.00 /hour; CAD operators involved in preparation of digitized wetland maps will be billed at $45.00 /hour. Mr. Peterson will provide project oversight and quality control for wetland delineations and evaluations, and will contribute to strategic elements of the Final Report, with special attention to sequencing and Wetland Conservation Act administration recommendations. Mr. Peterson's time will be billed at $95.00; time for other Peterson Environmental staff who may be involved in this project will be billed at a lower rate. The Tasks we have agreed to provide are as follows: SCOPE OF WORK Task 1 Map and Aerial Photo Review to Identify Potential Wetland Locations Existing wetland maps will be reviewed in combination with half- section (1 "= 200'scale) aerial photographs to identify areas to be reviewed in the field to delineate and verify wetland boundaries. In addition to National Wetland Inventory Maps and Protected Waters Inventory Maps, Metropolitan Mosquito Control District Maps will be reviewed to identify potential wetland locations. Task 2 Field Verification of Wetland Locations Wetland locations will be verified in the field using the Federal Manual for Identifying and Delineating Jurisdictional Wetlands (Federal Interagency Committee for Wetland Delineation, 1989). In order to achieve efficient project implementation, wetland boundaries and wetland classifications will also be determined during this field review. Thus, Tasks 2 and 3 will be combined in actual project implementation. Task 3 Wetland Delineation and Classification Jurisdictional wetland boundaries will be delineated on 1" =200' scale aerial photographs. Wetlands will be classified according to Wetlands of the United States (U.S. Fish and Wildlife Service Circular 39; Shaw and Fredine,.1971) and Wetlands and Deepwater Habitats of the United States (FWS /OBS Publication 79/31; Cowardin et al. 1979). Although only the Circular 39 classification system was cited in the Request for Proposal, it will also be necessary to determine Cowardin classifications because the rules of the Wetland Conservation Act use abbreviated Cowardin classifications in evaluation of wetland values. NAnweee Pmtess se,4941" mw a wv. Ms. Michele McPherson June 29, 1993 Page 2 Additional information to be collected during the delineation site visit will include predominant vegetation species, water source, inlet /outlet characteristics, evidence of past degradation or partial drainage, and unique natural features. Wetlands classified as protected waters by the Minnesota DNR will also be noted. All information will be recorded on standard data sheets designed to meet the needs of the City. Task 4 Draft Report Preparation A narrative and tabulated report will be prepared to summarize the findings of the delineation and evaluation. Each basin will be given an alpha- numeric designation based on its location in the City. The report will address the location, size, classifications, sequencing level, predominant vegetation, inlet /outlet characteristics, jurisdiction, and watershed (hydrologic unit) of each basin. The list of wetland parameters to be included in the report will be open to potential revision to accommodate the needs of the City. An effort will be made to tabulate as much information as possible to facilitate quick referencing of wetland information. Task 5 Public Value and Sequencing Evaluation The RFP calls for the consultant to calculate, based on the proposed BWSR rules under the Wetland Conservation Act, the public value for each identified wetland. However, the rules do not provide a methodology that readily lends itself to establishing a numerical ranking of wetlands according to their public value. The wetland replacement matrix in the rules (and its ancillary formulas for inlet /outlet characteristics and hydrologic units) provides ratios for "out -of -kind" replacement of wetlands. However, the matrix does not provide any stand -alone rankings of the various wetland types. We will provide the City with each of the elements required in the BWSR rules for determining wetland replacement needs. These include: (1) Cowardin wetland classification, (2) inlet /outlet type, and (3) hydrologic unit With these data compiled for all identified wetlands, the City will be able to readily apply the wetland replacement matrix to any project for which wetland replacement is necessary. We believe this is the City's primary need to facilitate local administration of the Wetland Conservation Act However, if the City would also like to apply a qualitative ranking system to delineated wetlands that would be suitable for planning and protection prioritization, we are open.to modifications to this proposal. The report prepared under Task 4 will include a reproduction of the wetland value matrix contained in the BWSR rules and a translation of the abbreviated Cowardin classifications used in this matrix. The administrative rules set three levels of sequencing, which are based on the size of the wetland area to be filled or drained. Wetland fills of less than 400 square feet are considered de minimis and therefore eligible for a no -loss determination under the Act. For wetland fills of 400 to 4,356 square feet (i.e., < 0.1 acre), the City may make a sequencing determination without requiring a project justification submitted by the applicant Any project proposing more than 0.1 acre of wetland fill is subject to full sequencing under the Act The U.S. Army Corps of Engineers' Regional Conditions to Nationwide Permit 26 apply the de minimis determination to fills of less than one -half acre in isolated basins. In order to assist the City in determining acceptable sequencing, we will determine the size all wetlands encompassing one -half acre or less. The applicable sequencing level will be coded for each basin and explained in the report prepared under Task 4. Task 6 Final Report and Map Preparation City staff will be given an opportunity to review and recommend revision of the draft report prepared under Task 4. Prior to development of the Final Report, the consultants will meet with City staff to obtain comments on and discuss revisions to the Draft Report. Ten copies of the final report will be provided to the City in bound 81 12 x 11" format. Wetland boundaries will be delineated on aerial photographs, digitized in AutoCAD (Version 12), and exported to a disk in DXF format, which can be imported and read by ARC -INFO. Wetland boundaries and classifications will be drawn and labeled on a City map in AutoCAD and plotted for display at 24!'x 36". 9K Ms. Michele McPherson June 29, 1993 Page 3 PRO.IIECTSCHEDULE In developing this schedule, we have assumed that City Council approval of the proposed tasks and budget would be granted at the July 6 Council Meeting, and that work would begin on July 7. Date July August September October 15 1 15 1 15 1 15 Task 1 Map and Photo Review (July 6-12) am 2 Feld Verification of Wetland Locations (July 12 - July 26) am 3 Wetland Delineation and Classification (July 26 - September 7) 4 Draft Report Preparation (September 7 - September 24) 5 Public Value and Sequencing Evaluation (September 7 - September 24) mmmm m 6 Final Report and Map Preparation (September 7 - October 22) COSTAND 77MEES77AoE47ES We have estimated the fees for providing the requested services to total $7,990.00, which would be broken down by Task as follows: Task 1 Map and Aerial Photo Review 'mated Fee: $385.00 Westwood Professional Services Biologist: 7 hours 0 $55 /hour Task 2 Field Verification of Wetland Locations_ Estimated Fee: $770.00 Westwood Professional Services Biologist: 15 hours 0 $55 /hour Task 3 Wetland Delineation and Classification—.Estimated Fee. $3510.00 Westwood Professional Services Peterson Environmental Consulting Biologist: 50 hours @ $55 /hour President: 8 hours 0 $95 /hour Task 4 Draft Report Preparation.- ..-------Estimated Fee: $1165.10 Westwood Professional Services Peterson Environmental Consulting Biologist: 16 hours 0 $55 /hour President: 3 hours 0 $95 /hour Task 5 Public Value and Sequencing Evaluation..Estimated Fee: $220.00 (Determination of wetland area for all basins less than one -half acre in size) Westwood Professional Services Biologist: 4 hours 0 $55 /hour Task 6 Final Report and Map Preparation...... imated Fee: $1940.00 Westwood Professional Services Peterson Environmental Consulting Biologist: 7 hours 0 $55 /hour President: 5 hours 0 $95 /hour CAD Operator: 24 hours CAP $45 /hour 9L Ms. Michele McPherson June 29, 1993 Page 4 ASSUA&FMONS 1. The City will provide all maps and aerial photographs required for completion of the specified tasks. Blueprint copies of aerial photographs will be necessary for accurate delineation of wetland boundaries in the field. In some cases, it may also be desirable to review two -foot contour mapping. 2. The City will provide locational control points and distances required for registering digitized wetland boundaries. It will be necessary to identify control points such as section corners on the 1" = 2W scale aerial photographs to be used in the delineation. 3. Estimated fees do not include time for detailed meetings with City staff or presentation of findings at City Council meetings. We have assumed that most coordination with the City can be accomplished via telephone. However, we have included time for one meeting with City staff to discuss revisions to be made to the Draft Report. 4. All work will be invoiced from Westwood Professional Services. Invoices from Peterson Environmental Consulting will be passed on at cost to the Client. Although Westwood does not charge for project- related travel within the Metro area, project - related travel by Peterson Environmental Consulting will be invoiced at $0.28 /mile. COMPENS47ION The tasks listed in the foregoing Scope of Work will be provided on an hourly basis in accordance with the attached fee schedule and general contract conditions. We estimate the cost of completing these tasks to be $7,990.00. This amount includes duplication costs related to production of ten copies of the final report. The estimated fee of $7,990.0 will not be exceeded without prior authorization from you. Any special reports, studies, agency coordination, permit applications, revisions or other services not contained in the Scope of Work and ordered by the Client shall be performed on a per diem basis in accordance with the attached fee schedule. All work will be billed monthly, based on the pro -rata amount of work performed during the previous month. All invoices are due and payable upon receipt. All invoices outstanding thirty days or more from billing date will be charged a finance charge (interest) at the rate of 1.25° per month. Please let us know if you have any questions on this proposal or if you wish to explore any additional tasks. A signed and returned copy of this letter proposal, combined with City Council approval, will serve as our authorization to proceed. We appreciate this opportunity and look forward to working with you. Very truly yours, WESTWOOD PROFESSIONAL SERVICES, INC. Robin P. Bouta Wildlife Biologist Enclosures: fee schedule general contract conditions ACCEPTED AND APPROVED BY: William W. Burns, City Manager City of Fridley 9MDate Westwood Professional Services, Inc. 14180 Trunk Hwy. 5 Eden Prairie, MN 55344 612 - 937 -5150 FAX 612. 937 -5822 FEE SCHEDULE FOR PROFESSIONAL SERVICES MARCH 1. 1993 In general. where it is possible to determine in advance the SCOPE OF A PROJECT and the time and effort the Project will require. the fee basis for Engineering Services will be a percentage of construction cost or lump sum. Where this is impossible, because of the complex nature of work tasks that are variable in nature and where the time required is controlled by the Client, citizen involvements and environmental problems, where the time requirement is beyond the control of the Consultant, the following fee schedule will apply. Charges for Other Direct Costs and facilities furnished by Westwood are computed on the basis of actual cost plus 15 percent. Classification Hourly Rate PrincipalEngineer ............................................. ............................... ..........................85.00 Principal Planner/Landscape Architect ................ ............................. ... ..........................85.00 Principal Registered Land Surveyor .................... ............................... ..........................85.00 Senior Transportation Engineer .......................... ............................... ..........................75.00 Senior Project Engineer/Planner/Landscape Architect ....................... ..........................75.00 Project Engineer /Surveyor/Landscape Architect . ............................... ..........................65.00 Wildlife Biologist/Environmental Scientist ........... ............................... ..........................55.00 Survey Coordinator / Engineer ....................................................... ............................... 55.00 Senior Engineering Technician .......................... ......................... ...... ...........................5200 Planner/Landscape Architect .............................. ............................... ..........................48.00 Senior Construction Coordinator ...........................................:....... ............................... 52.00 ComputerDraftsman ................................................ ......................... ..........................45.00 Engineering Technician ...................................... ....:.......................... ..........................40.00 ConstructionObserver ................................................................ ........................... . . .. ..45.00 Associate Planner/Landscape Architect .............. ............................... ..........................40.00 Drafting, Technical Writer .................:................. ......................... . ..... ..........................35.00 Engineering Aide, Clerical/Graphic .......................... ......................... . . . . .. .....................30.00 Two - Person Survey Crew .................................... ........................ ...... ..........................80.00 Three -Person Survey Crew .......................................................... .......................... . .. .. 97.00 Expert Witness - Court Appearance/Deposition ............................. ..............................2 x rate No charge for mileage within the Twin City Metro area No charge for in -house computer or plotter time There is a finance charge of 1.25% per month (15% annual percentage rate) appP� adurges which have become more than 3o days past due based on dwa sh-wn on t#iginal invotCe. weawmod VMessmnsl Sm� N[ e w eWal oppm`mrtr amobYec GENERAL CONDITIONS TO CONTRACT /AGREEMENT W FOR PROFESSIONAL SERVICES Westwood Professional Services, Inc. SECTION 1. SCOPE OF WORK WESTWOOD PROFESSIONAL SERVICES. INC. (hereinafter called WESTWOOD) shall perform the services defined in this contract. and shall invoice the CLIENT for those services at the rates shown on the attached FEE SCHEDULE. For extended projects, the billing rates may increase on January 1st of each year at an annual rate not to exceed 10x. Any estimate of cost to the CLIENT as stated in this contract shall not be considered as a firm figure. but only as an estimate. unless otherwise specifically stated in the contract. WESTWOOD will provide additional services under this contract. as required to complete the assignment, and /or as authorized by the CLIENT and requested by the CLIENT with charges for those additional services invoiced at the stated rates. 2.1 WESTWOOD will not be responsible for the failure of others to perform in accordance with the specifications or contract documents, and WESTWOOD's services shall in no way relieve others of their responsibilities. 2.2 CLIENT will make available to WESTWOOD all known information regarding existing and proposed conditions of the site and project to be undertaken. CLIENT will immediately provide WESTWOOD with any new information which becomes available to it or its contractors which differs materially from information previously provided, but including all changes in plans. WESTWOOD has the right to rely on the information contained in documents provided by the CLIENT. WESTWOOD will use its best efforts to perform the work and accomplish the objectives defined in the scope of work within the estimated costs and schedule proposed. The estimated costs and schedule proposed are based on our best judgment of the requirements known at the time of the proposal. Successful completion within cost and schedule limits can be influenced - favorably or adversely - by r' • changes in work scope and schedule as dictated by client needs and by presently unforeseen circumstances. WESTWOOD will notify the CLIENT in advance if schedule or costs are expected to exceed the estimate. In such event. the CLIENT may wish to (1) authorize additional funds to complete the work as originally defined. (2) redefine the scope of work in order to fit the remaining funds. or, (3) request that work be stopped at a specific expenditure level. If option 3 is chosen. WESTWOOD will turn over such data, results and materials completed at the authorized level without further obligation or liability to either party except for payment for work performed. SECTION 4. PAVKNT. INTEREST AND BREAM 4.1 CLIENT agrees to pay invoices on receipt, and to pay interest on unpaid balances beginning thirty days after invoice date at the rate of 1.5x per month. but not to exceed the maximum rate established by law. 4.2 In the event CLIENT fails to pay WESTWOOD within SO days following the invoice date. WESTWOOD may consider the default a total breach of this Agreement and may, at its discretion, terminate all of its duties without liability to WESTWOOD or others. SECTION S. INSURANCE WESTWOOD will furnish certificates of insurance upon request. If the CLIENT requests increased insurance coverage. WESTWOOD will take out additional insurance, if obtainable. at the CLIENT'S expense, but shall have no liability beyond the limits and conditions of the insurance coverage. SECTION 6. HAZARDOUS WASTE Except as expressly provided elsewhere in this contract, WESTWOOD is under no duty or obligation to discover or disclose to CLIENT any knowledge regarding the existence of hazardous substances on the property covered by this agreement or adjoining properties. CLIENT agrees =o 1 of3 GENERAL CONDITIONS indemnify and hold WESTWOOD harmless from and against all claims related to hazardous substances arising out of or resulting from the performance of our work or hazardous substance - related claims against WESTWOOD arising from the work of others. SECTION 7. STANDARD OF CARE In performing its services, WESTWOOD will use that degree of care and skill ordinarily exercised under similar circumstances by reputable members of its profession practicing in the same locality. No other warranty is made or intended. SECTION 8. LIEN RIGfTS WESTWOOD hereby gives notice that. pursuant to Minn. Stat. Chapter 514. it retains the right to file a lien against real P*'operty in the event of non - payment of invoices for engineering. landscape architecture. surveying. planning or environmental services performed with respect to the subject property. The lien will be prepared and filed 'in accordance with pertinent laws of the State of Minnesota. Neither WESTWOOD nor CLIENT will be liable to the other for any indirect. incidental. special or consequential damages (including loss of anticipated profits, business interruption, good will or other economic or commercial loss), relating to the services rendered. SECTION 10. TERMINATION Either WESTWOOD or CLIENT may terminate this agreement by giving fourteen (14) days' written notice to the other party. In the event of such termination, for whatever cause, the CLIENT shall pay WESTWOOD the costs that WESTWOOD has incurred to the effective date of termination, including any obligations, commitments and unsettled claims plus any charges due and owing by the CLIENT as of the date of termination to include reasonable termination expenses. Uoon payment, any and all obligations and liabilities of the parties hereto shall terminate. SECTION 11. OWNERSHIP OF DOCUMENTS If requested, the Client will be provided reproducible copies of original drawings for their use. Original signed Drawings and Specifications as instruments of service are. and shall remain the property of WESTWOOD. whether the project for which they are made is executed, or not. WESTWOOD is.not to reuse these drawings, or any part thereof, for any other client that WESTWOOD may have, without the written approval of the CLIENT. These drawings are not to be used by the CLIENT on other Projects. or extensions to this project. except by agreement in writing and with appropriate compensation to WESTWOOD. SECTION 72 RELATIONSHIP OF PARTIES WESTWOOD will act solely as an independent contractor of the CLIENT and not as the CLIENT'S agent for any purpose. Neither WESTWOOD nor the CLIENT may enter into any agreement or assume any obligation for the other, and nothing herein may be construed to establish any Partnership. joint venture or principal - agent relationship between WESTWOOD and the CLIENT. SECTION 13. FORCE mAjEURE WESTWOOD will have no liability for any failure to perform or delay in performance due to any circumstances beyond its reasonable control. including. but not limited to. strikes. riots, wars, fire, flood. explosion. acts of nature. acts of government, labor disputes. delays in transportation or inability to obtain material or equipment. In the event of any delay in performance due to any such circumstances, the time for performance will be extended by a period of time necessary to overcome the effect of such delay. and the CLIENT will not be entitled to refuse performance or otherwise be relieved of any obligations: The CLIENT and WESTWOOD each binds itself, its successors. assigns and legal reoresentatives to the other party of this agreement and to the successors. assigns and legal representatives of such other party with respect to all ':)f3 GENERAL CONDITIONS Provisions of the agreement. Neither the CLIENT nor WESTWO00 shall assign, set over or transfer his interest in this agreement, in whole. or in part. without the prior written consent of the other. and any act in derogation hereof, shall. at the option of the non - assigning party. render the written agreement terminated. SECTION 15. ARBITRATION All claims, disputes and other matters in question arising out of. or relating to, this Agreement or the breach thereof shall be decided by arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association then obtaining unless the parties mutually agree otherwise in writing. This agreement to arbitrate shall be specifically enforceable under the prevailing arbitration law in the State of Minnesota. Notice of the demand for arbitration shall be filed in writing with the other party to this agreement and with the American Arbitration Association. The demand shall be made within a reasonable time after the claim, dispute or other matter in question has arisen. In no event, shall the demand for arbitration be made after the date when institution of legal or equitable proceedings based on.such claim, dispute or other matter in question would be barred by the applicable statute of limitation. All arbitrations will be conducted in Hennepin County, Minnesota. The award rendered by the arbitrators shall be final and Judgment may be entered upon it in accordance with applicable law in any court having jurisdiction thereof. Arbitrations of claims arising from this agreement shall not be consolidated with any other arbitration proceedings except by written consent of the parties. SECTION 16. ENTIRE AGREEMENT The CLIENT'S engagement of WESTW000 to perform work represents the CLIENT'S acceptance of the terms and conditions contained herein. which constitute the entire understanding between WESTWO00 and the CLIENT and suoersede and previous cdnmunications, representations or agreement by either party. whether oral or written. The terms and conditions contained herein take precedence over the CLIENT'S additional or different terms and cmWitions that may be contained in any purchase order, work order, invoice. gate pass, acknowledgement form, manifest or other document forwarded by the CLIENT to WESTWOOD to which notice of objection is hereby given. Unless otherwise agreed to in writing by an officer of WESTW000. the CLIENT'S engagement of WESTWO00 is limited to these terms and conditions. WESTWO00'S commencement of Performance will not be deemed or construed as acceptance of the CLIENT'S additional or different terms and conditions. No change of any of the terms or conditions herein will be valid or binding on either party unless in writing and signed by the owner or and officer of CLIENT and by an officer of WESTWOOD. If any of the provisions hereof are invalid under any applicable statute or rule of law, such provisions are. to that extent. deemed omitted. but the remaining terms and conditions of this agreement will remain otherwise in effect. There are no understandings. agreements. representations or warranties. express or implied, that are not specified herein respecting the subject hereof. SECTION 17. APPLICABLE LAW This agreement shall. be governed by the laws of the State of Minnesota. SECTION 18. EE0 /AA Westwood is an Equal Employment Opportunity /Affirmative Action Employer. 3 of 3 h For More Information, Contact Timothy P. Browne Browne & Browne Marketing (612) 449 -5116 NEWS RELEASE MRS4 Minneapolis, MN May 21, 1993 - NuSports Systems Inc., a Minneapolis -based family sports entertainment company, has announced the opening of their first Twin Cities facility located in the Moore Lake Commons Mall in Fridley near Highways I -694 and 65 (Central Avenue). Named Sports Spree Fun Parkrm, the 24,000 square foot indoor family entertainment center offers 25 different sports related activities priced at $0.25 to $3.75. Open year - round, the free- admission "pay -as- you - play" format, will be alcohol and smoke free. Construction on the all- indoor park has commenced and is scheduled to open early fall of 1993. Specifically designed for the entire family, Sports Spree Fun Park will be the first complete indoor family entertainment center in the Twin Cities with a sports and fitness related theme. The initial Park activities will include both fast and slow pitch baseball and softball batting cages, an 18 -hole miniature golf course featuring Pebble Beach's ocean -side 8th hole, Sports Bumper Cars, Softplay Fun and Fitness Center for Kids, basketball and volleyball Fun Court, video and sports skill games, billiards, and children and adult birthday party facilities and packages. Sports Spree will cater to group functions such as youth sports league meetings, baseball and basketball instructional clinics, softball team practices, fund raisers, company meetings and picnics, church functions, school field trips and parties. The court area and batting cages will feature an "overlook" elevated viewing area for people to watch basketball and volleyball. The year -round Park will also feature a Bridgeman's Soda more... SPORTS SPREE FUN PARKTM FRIDLEY MOORE LAKE OPENING MAY 21, 1993 Page two Fountain, a non - alcohol Sports Bar Restaurant with television monitors broadcasting live sporting events and a Sports Update Scoreboard. Sports Spree will periodically change activities based on sports entertainment trends with plans to offer the popular simulated "Sums Wrestling" for both youths and adults. A special section of the Park will be designated for sports memorabilia and changeable "museum" trophy items for display from local sports teams. A grand opening announcement and date will be made this July. Ankeny, Kell, Richter, Walsh Architects, who designed the multidimensional facility, have received national recognition and awards for community center architectural designs. NuSports Systems, Inc., began in 1992, has plans to develop 20 Sports Spree Fun Parks in major Midwestern markets with similar Parks slated for the Minneapolis/ St. Paul area. NuSports Systems' corporate staff, with extensive business experience in retail, sports and entertainment, has designed proprietary operations, marketing and market expansion systems under the Sports Spree Fun Park name. Sports Spree Fun Park is located in Fridley at 1001 E. Moore Lake Drive, Fridley, MN 55432, (612) 571 -3000. a° 0 1.1 Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 30, 1993 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Request for Assistance from NuSports Sports Spree Pat Pelstring of Business Development Services, Inc.-, represents Sports Spree, a family /entertainment center. Sports Spree is proposing to locate in the.Moore Lake Shopping Center (the former Country Club Market site). Pelstring has requested the HRA assist Sports Spree in the amount of $50,000 via a loan over 10 years at an interest rate of 7.5 %. Background The Sports Spree facility is proposed to be the first of four indoor family entertainment centers in the Twin Cities metropolitan area. Each center will include different activities such as miniature golf, batting cages, bumper cars, video games, etc. The Building Division is currently reviewing the building permit application to remodel the tenant space at Moore Lake Shopping Center. Request The total cost of the project to locate in the Moore Lake Shopping Center is $900,000. Pelstring has indicated that Western State Bank has tentatively committed to providing $250,000 worth of financing. About $500,000 has been raised from-investors leaving a gap of $150,000. Policy Issues The HRA has not previously considered or funded tax increment assistance for a leasehold /tenant improvement. While the HRA has assisted projects via second mortgages or other loans, they have all been for free - standing buildings. The Moore Lake Shopping Center is within the redevelopment project area but is not within the tax increment district; therefore, the HRA does not collect tax increment from this parcel. Our policy guidelines developed last year did not specifically address leasehold or tenant improvements. 1.2 Request for Assistance from NuSports Sports Spree June 30, 1993 Page 2 A loan could be executed since the project is within the redevelop- ment project area; however, the level of risk is increased since the HRA does not receive tax increment from the parcel. While the loan would contain a guarantee from the owners if the loan payments were not made, the HRA's risk is increased without the additional tax increment to rely on. Funding a project of this type would require establishment of specific policy guidelines and parameters. Previous requests from other tenants in the community have been rejected at a staff level because previous history from the HRA has not been to provide assistance for tenants. Finally, the HRA reviewed the cash flow analysis for the budget recently, and it was determined that our cash flow should be prioritized for housing programs, redevelopment of the Lake Pointe site, and the southwest quadrant. Recommendation It is exciting that the Sports Spree ownership has chosen Fridley for its first location in the metropolitan area. Occupying the former Country Club Market site will add to the vitality of the redevelopment area. Unfortunately, because of previously established priorities and policies, staff recommends that the HRA not pursue further negotiations for assistance on this project. We have attached correspondence from the petitioner as well as background information about the business and proposal. BD:ls M -93 -383 bLJ 1iVL . • JUL- 022-'93 FR 09:35 ID:BDS INC. TEL N0:786-9034 t#176,P02 s ~r ' �uatrxess D�vefop a �t t�rioes,•Inc. TO: " Baibaft- bacy,, City of Fridley ; ;1riey. Housing and Redevelopment Authority FROM:: `irk: i1V. I'eistriri BiridgGwater Pistancial Group DATE:, : i* --:2. -1993 . . - '&Sppwspbrts Spree I walitcd to-liroyide a follow -up based upon our meeting this past Monday to discuss. the status of the- NuSports project. We are pleased ,to report that • we have ' reached' axe anent• for f bt with' a •local bank for the NuSports project in Fridley. "This reduces irhe .tom funding "gap ": tb apprbaimat i)+ $Bd,Ot10.. Asa result, we- would like to amend our ' requot• Air W T w- ant ta�emphas* •that the location of the project•in Fridley is signs icaet as•al�is.will tie the fim.bf �a;ebamn of Sports Spree centers to be looted throughout the upper •midw .9 princ#Ws of Sports.Spree.expect that the corporaxe headquarters will be located•in�.F=ldtdy O.a part of the Fridley► operation.' Itdtially; the corporate staff is anticipated to be relatively.mo .oat:(th= to five p6opie), :but , ovo time, the employment • associated with the corporate hrad u�rrters is anticlpatd:t©. 9raw to between 15 to 25 pex�ple. The trompaany. is .anticipating _an,.initial.public offering the •stook yin: mid to late 1994: -We thait•tliis loan request is unique in terms of the types of assistance .tlieIIoµsing and Red6veloprrient- Atiithtlrity typically provides.. We .feel, 'however, that .the •a6atttai'es to the center :itself :arid rile .location. of the. corporate headquarters provide 'attractiVie ftul which Will benefit this areal and the city of Fridley greatly, in- terms of recognition• -and Job;dreation. We look•forW&d to the opportunity to review Ibis exciting project -with you:ut .yout next JIM • tr►eetirtg. , . •, • • -__. .. _ ..._......_ic.. �..84.. SAM eWAA4 6L.....e.•R10 /CAI1_7070� v-IS�fI -A?�91 a Ms. Barb Dacy May 24, 1993 Page 2. -Your consideration of this request is based upon-the.following economic_ factors,-.as'they relate. to the City; of Fridley: - 1 Provides -Additional Job Opportunities for Area Residents. The' company expects to retain 5 full- time professional. staff,- and anticipates - having approximately 6 part-time employees. Many of -these jobs, will .be ,available during- the -summer months; and can R rovide em P to y ent for the . ou. th. and hi h- school a g ed residents of the community., 2 :,; Impact on Moore :Lake :Centaer..ry Tre' stark dip of SlnortSpree.NuSports in the Moore Fake shopping center will 'have: a positive 1M. pact on the, overall redevelopment of this shopping center The space has been: unoccupied; on a permanent basis, since the.closmg vF the,:Country..Ciub "1Vlaket. ; In addition, as;we ;understaiiid; `the current :tenant mix lias not supported - additional leasing It is clear that alae draw from NuSports``should aid in' the generation of additional tenants to suppoxt the zenter 3-: Increased Tax Increment Revenues - The development of the ,Sports - Spree/NuSports: f facility will likely iesult,in an overall.increased valtataon':=of thecenter,. As:a result, the City can_ exp&t.addidonal TIF funding, estimated 'at $10-15;000 =per ;year - :from. Smarts Spree; .which w..0 be. provided -for the* City's 3'ax° Increment Financing- Program: ' .You . will note that the general partners of $ports Spree are'requesting a .ioah at market interest rates; which :will. provide additional income . to the : Mousing. and Redevelopment Authozity The -increased :tax -revenues will: represent ,a.: net increase to the City's Tax Increment Financing program. 4 Recreational Activities for Area... Residents' and Children ': The .Sports, Spree - concept is alcohol .and -srrioke :free,: and . the activities :,withmn the center will .provide additional opportunities for area youth -to` seek worthwhile activities. We recognize> that this -request is "somewhat :unique , W , ave•,discussed this project with you previously, but had: not pursued City %HRA : assistance, as we were confident that the equity commitment would-, sufficiently generate:conventional lending interest..-To date, however; this financing has, not been , available, and we are seeking; your assistance to assure that this rthwhile 'ect will _be built in the City of Fridley.'. el Y� Patrick..W. Pelstring S SPORTS SPREE LIMITED PARTNERSHIP I EXE'CU77VE SUMMARY ie • 1 1.6 NuSports Systems, Inc. is a C- Corporation started in March of 1992 that acts as the general partnership for the purpose of managing indoor family entertainment centers. The first six centers will be structured as limited partnerships. The proposed schedule is to have 14 centers in operation in the next five years (1993 -1997). Each center. will include over 20 different activities. Some of those activities will be miniature golf, batting cages, bumper cars, video games, etc. The centers will be designed around a sports theme and will contain colorful signage /marquee and a high- impact color scheme and layout throughout the facility. The first facility will be located in Fridley, Minnesota at Moore Lake Commons, one mile north of I-694 on Highway 65. Sports Spree will be leasing a facility that was previously a Country Club Market which is 23,980 square feet. This first facility is scheduled to open August 1, 1993. M *m o Ini a "I DO i Market research studies conducted by the International Association of Amusement Parks and Attractions (IAAPA) and J.L.A. Research and Development indicate there is a large demand for indoor family entertainment centers that provide participatory sports attractions combined with games and good food. Some of the reasons for the increased demand include: reasonable cost per visit, excellent form of family entertainment, good group activity, attractions are types that have been enjoyed for years -- they are not fads, and the variety of activities available in one location. I 1.7 The piroject involves improvements to the facility, equipment purchases and • = ' working capital... The detailed project budget is as follows: IibY� Marketing: $79,000 • Brochures $15,000 • Promotional Sheets 5,000 • Grand Opening 20,000 • Photography 3,000 • Public Relations 4,000 • Creative 5,000 • Graphics /Signage 27,000 Development: 42,500 • Travel 2,000 • Fee 36,500 • Feasibility Study 4,000 Improvements 340,000 Architect: 35,000 • Schematic 3,000 • Working Drawings 25,000 • Prints, etc. 3,000 • Creative/Renderings 4,000 Legal: 6,000 • Lease 2,200 • Partnership 2,500 • Other 1,300 Accounting: 2,000 1.8 Restaurant: 50,000 • Consulting Fee 5,000 . • F, F & E 40,000 • Opening Expenses 5,000 Equipment: • • 302,000 • Batting Cages 40,000 • Miniature Golf 55,000 • Bumper Cars 75,000 • Basketball Court 7,000 • Children's Challenge 30,000 • Televisions and Sound Systems 15,000 • Bowling 60,000 ' • Miscellaneous 20,000 Working Capital and Contingency 43,500 r TOTAL USES OF FUNDS $20-0,000 SOURCES OF FUNDS Bank $324,000 NuSports Systems, Inc. 450,000 Limited Partners 126,000 TOTAL SOURCES OF FUNDS $9001000 1.9 MI- _- I • Sports 'Spree is projecting sales of $630,000 in year one and $935,460 for year two, with net incomes of $71,426 and $273,526, respectively. The projected cash flow coverage ratio for year one is 2.9:1 and for year two is The partners will be injecting $576,000 equity which results in a profocma debt-to-equity ratio of .56:1. The proforma current ratio is 2.17:1. The average account balance of the partnership is anticipated to be approximately $50,000. The cash balance of NuSports Systems is anticipated to be in excess of $100,000. After the IPO, it is anticipated this balance would increase to $500,000. COLLATERAL ANALYSIS The loan will be secured by the equipment to be purchased along with a $100,000 cash reserve account, as follows: Equipment $342,000 Less: Net Bank Loan (225,0001 EXCESS COLLATERAL $117,000 This gives the bank a 66 percent loan -to- value. Personal guaranties will be available from four individuals who will form an investment partnership to hold stock in this project. In addition to the original $100,000, the company will contribute $15,000 per quarter into the reserve account to further secure the loan. This would result in a cash reserve equalling the outstanding debt within 28 months. 1.10 MANAGEMENT In addition to the cash flow, the management team is one of the greatest .strengths of this project. The management team has extensive experience in site research, design, retailing, operations, marketing, and indoor family entertainment. There wiH -be six members of the Board of Directors, a three - member Board of Advisors, a Managing Director, a Manager, an Assistant Manager, and 11 full -time and part-time employees. Sports Spree Limited Partnership I will be the borrowing entity. NuSports Systems, Inc. is the managing partner. SUNEVI_ARY This project has been developed by highly successful and highly motivated individuals who have experience directly related to this operation. A substantial amount of research has been performed to ensure that the product, the site, the marketing plan, and the management team are the best available to make this project a success. The business strategy involves maintaining modest salary levels with performance bonuses linked to actual results, maintaining a low debt-to-equity ratio for each project and positioning the centers to be the industry leaders. Ultimately, the company plans an IPO for $4,000,000. i� 0.4, A A "' Z A K O A� N.dp E� A °"a A Eod amA = -- ..F��d �o>��a q>�u �s�.aa�EE aE Ergo R V N A a E y r ON i4 p� d day `� V"'� y dy •�►A a-f p..d. °��� u'� A :0 O y •� G7 �V r E� R Cd ° CI A 'r °� ° —�i Qay� Qn O Ar"- 90$eo�A� o C 'C C ��°�AA Ao CL. Be °ooAO'g l$Q L O m Sew$ Aa$a % ;.a S 3 �7° Op "HO •d~•EE`�'o-ea- .�O�a°�e v OIA vS°'=9 °o0 8 gs ° cc a— r L 1.0 p� M ii aa.u.5 9 MIA �' ► a9 a � ivd m��� WZ 0 .J � a cn CM/:) .w d W w z O v d 5� w �Y Q U �1 e O • O bA z -vlov���� �o�+DOEeb+'� °C 00 28 �. V A , W9 E mm d"=& -0 !z > OO �+ o5do unM Ai"'a0p7�10 r �� A 2.O vt a0 Z at A 6A1Z.0 aO YOa A�C r H= i A O Od'Oi.—b- t ° ow W 0 if-10 r iii 0=.O a -.270 e a A W Q 0 Q d 0 1L Ml:5 S i A O �+ 9 O E- E31. cCE OC�ACC�� C AO6d C6 E Arm E= SEE of, gEjA oa 6006.. d °a1 AvA�.s y C O �� B C dV i dam' C $ ° S E — I S, ao d o .9 "Mo'e �E� �pdt — s°d CrO yA4mC --� apNI�iS idr it A Al duo �9� d i1 E" =E — =- A'cc co gv• 6. � W co- r Ac O °� C� p.0 `� 40 eA °�� �v a ` �E eE�'-�q= pp V �p CMpz— A O A :V C, 45 fA a� EOO� Al I. For More Information, Contact Timothy P. Browne Browne & Browne Marketing (612) 449 -5116 1,12 NEWS RELEASE For Immediate Release MULTI -SPORT FAMILY ENTERTAINMENT CENTER, SPORTS SPREE FUN PARKTM, TO OPEN IN FRIDLEY Minneapolis, MN May 21, 1993 - NuSports Systems Inc., a Minneapolis -based family sports entertainment company, has announced the opening of their first Twin Cities facility located in the Moore Lake Commons Mall in Fridley near Highways 1 -694 and 65 (Central Avenue). Named Sports Spree Fun ParkTM, the 24,000 square foot indoor family entertainment center offers 25 different sports related activities priced at $0.25 to $3.75. Open year - round, the free - admission "pay -as- you -play" format, will be alcohol and smoke free. Construction on the all- indoor park has commenced and is scheduled to open early fall of 1993. Specifically designed for the entire family, Sports Spree Fun Park will be the first complete indoor family entertainment center in the Twin Cities with a sports and fitness related theme. The initial Park activities will include both fast and slow pitch baseball and softball batting cages, an 18 -hole miniature golf course featuring Pebble Beach's ocean -side 8th hole, Sports Bumper Cars, Softplay Fun and Fitness Center for Kids, basketball and volleyball Fun Court, video and sports skill games, billiards, and children and adult birthday party facilities and packages. Sports Spree will cater to group functions such as youth sports league meetings, baseball and basketball instructional clinics, softball team practices, fund raisers, company meetings and picnics, church functions, school field trips and parties. The court area and batting cages will feature an "overlook" elevated viewing area for people to watch basketball and volleyball. The year -round Park will also feature a Bridgeman's Soda more... FRIDLEY, MN 55U2 612 - 511 -poo 1.13 SPORTS SPREE FUN PARKTM FRIDLEY MOORE LAKE OPENING MAY 219 1993 Page two Fountain, a non - alcohol Sports Bar Restaurant with television monitors broadcasting live sporting events and a Sports Update Scoreboard. Sports Spree will periodically change activities based on sports entertainment trends with plans to offer the popular simulated "Sums Wrestling" for both youths and adults. A special section of the Park will be designated for sports memorabilia and changeable "museum" trophy items for display from local sports teams. A grand opening announcement and date will be made this July. Ankeny, Kell, Richter, Walsh Architects, who designed the multidimensional facility, have received national recognition and awards for community center architectural designs. NuSports Systems, Inc., began in 1992, has plans to develop 20 Sports Spree Fun Parks in major Midwestern markets with similar Parks slated for the Minneapolis/ St. Paul area NuSports Systems' corporate staff, with extensive business experience in retail, sports and entertainment, has designed proprietary operations, marketing and market expansion systems under the Sports Spree Fun Park name. Sports Spree Fun Park is located in Fridley at 1001 E. Moore Lake Drive, Fridley, MN 55432, (612) 571 -3000. I I I.j ilk �( WHAT: WHEN: 1.14 NEWS RELEASE SPORTS SPREE FUN PARKTM FACT SHEET May 21, 1993 Sports Spree Fun ParkTM Twin Cities First Sports Themed Indoor Family Entertainment Center, a smoke/alcohol free environment. Opening late summer /early fall 1993 WHERE: Sports Spree Fun ParkTM 1001 E. Moore Lake Drive (Moore Lake Commons Shopping Center) Fridley, MN 55432 (just north of I-694 on Hwy 65 (Central Avenue) (612) 571 -3000 WHO: NuSports Systems Inc. 601 Lakeshore Drive, Carlson Center, Minnetonka, MN 55305 Architect: Ankeny, Kell, Richter & Walsh Architects, P.A. Contractor. Building Environments Inc. Marketing: Browne & Browne Marketing Inc. ACTIVITIES: Over 25 participative sports related activities for kids, teens and families. Fast and slow pitch baseball and softball batting cages, 18-hole miniature golf, sports and skill games, Sports Bumper Cars, Softplay Fun and Fitness Center for Kids, basketball and volleyball court, billiards, Sports Bar Restaurant, Bridgeman's Soda Fountain, live sports telecasts on big screens, private rooms for birthdays or company or group meetings. GROUP EVENTS: Private parties, birthday parties and company holiday and family parties and picnics, baseball/softball league and team meetings, awards banquets, fund raisers, and club, church and school group outings. MARKETING: Various added value patron activities such as Sports Spree education and training sessions, Health & Safety Fairs, a costume mascot, official sponsor days and events, Club Spree for guests who visit frequently, sports celebrity appearances, a local "Athlete of the Week" recognition and more. HOURS: SIZE: STAFF: ADDITIONAL INFORMATION: Open year round, seven days a week. 24,000 Square Feet General Manager, Assistant Manager to be hired full-time; 12 full and part -time guest relations staff. Tim Browne, Browne & Browne Marketing Inc. (612) 449 -5116. 2.1 e Community Development Department U HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 1, 1993 TO: William Burns, Executive Director of HRA d4(-V- FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Resolution Authorizing Home Improvement Loan Program Proposed for HRA consideration is the first of three resolutions which must be adopted by the HRA in order to implement our various housing rehab programs. This resolution pertains to the Home Improvement Loan Program. The resolution accomplishes several functions including: 1. Establishes the program and area of operation. 2. Provides for delegation of certain powers and duties. 3. Authorizes execution of an agreement between the HRA and Fridley State Bank-for the program. As you will recall, the purpose of this program is to provide low interest loans to owner /occupants of 1 -4 unit properties. Owners can borrow up to $15,000 for a maximum term of 15 years at an interest rate of 3 -9 3/4 %. To qualify for the program, a borrower must: 1. Have a gross annual income of $41,000 or less. 2. Have a good credit history and demonstrated ability to repay the loan. 3. Have sufficient equity in their home if security is required. The bulk of the financing will be provided through the Minnesota Housing Finance Agency (MHFA); however, the HRA will provide deferred loans to help owners reduce their borrowing costs. HRA funds will be used in conjunction with the MHFA program as follows: c 2.2 Resolution Authorizing Home Improvement Loan Program July 1, 1993 Page 2 If the applicant The HRA will provide borrows from MHFA: deferred payment loan: Not to exceed: Up to $5,000 equal to 10% of the MHFA $500 loan amount $5,001 to $10,000 120 of the MHFA loan $1,250 $10,001 to $15,000 15% of the MHFA loan $2,250 The HRA loan does not have to be repaid until the owner sells his /her home. We will work with Fridley State Bank to process loans after the applicants have gone through the pre- screening process. We anticipate to start making loans some time in August. GF:ls M -93 -387 2.3 RESOLUTION NO. A RESOLUTION ESTABLISHING A HOME IMPROVEMENT LOAN PROGRAM; ESTABLISHING THE AREA OF OPERATION; PROVIDING FOR THE DELEGATION OF CERTAIN POWERS AND DUTIES; AUTHORIZING THE EXECUTION OF A MEMORANDUM OF UNDERSTANDING BY AND BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY AND THE FRIDLEY STATE BANK. BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority "), as follows: Section 1. Recitals. 1.01. It has been proposed that the Authority establish a Home Improvement Loan Program (the "Program ") for the residents of the City of Fridley (the "City "). 1.02. It has been further proposed that the Authority participate with the Minnesota Housing Finance Agency (the "M.H.F..A. ") to secure funding and that the Authority provide its funds for additional assistance. 1.03. It has been further proposed that the Authority enter into the necessary agreements to implement the Program including a Memorandum of Understanding (the "Memorandum ") with the Fridley State Bank (the "Bank ") as a participating lender. Section 2. Findings. 2.01. The Authority hereby finds that its area of operation in which to implement the Program is the area within the territorial boundaries of the City as provided for in Minnesota Statutes, Section 469.002, Subd. 8. 2.02. The Authority hereby finds that the adoption of the Program promotes the purposes of the Authority as those purposes are defined in Minnesota Statutes, Section 469.001, et sect. (the "Act "). 2.03. The Authority hereby finds that the Program will assist in the alleviation of shortages of decent, safe and sanitary residential housing available within the City at prices affordable to persons and families of low or moderate income as described therein. 2.04. The Authority hereby finds that preservation of the quality of life in the City is dependent upon the maintenance, provision, and preservation of an adequate housing stock; that accomplishing 2.4 Page 2 - Resolution No. the is a public purpose in that there are many residences in the City which require rehabilitation; that a need exists to provide in a timely fashion affordable housing to persons of low and moderate income as described in the Act and herein residing and expected to reside in the City; that many owners, would -be purchasers or providers of residences are unable to obtain mortgage credit for rehabilitation of residences under current market conditions; and that in establishing its Program the Authority is acting in all respects to benefit the citizens of the City and to serve a public purpose in improving and otherwise promoting their health, welfare and prosperity. Section 3. Authorization of Program. 3.01. The Authority hereby approves and adopts the Program as described on Schedule A attached to this Resolution. Section 4. Delegation of Power and Duties. 4.01. In accordance with the Act, specifically Minnesota Statutes, Section 429.012, Subd. 1(3), and in accordance with the Program Description and Guidelines, the officers, agents and employees of the Authority are hereby authorized to take such actions as may be necessary to implement the Memorandum and operate the Program. 4.02. The Executive Director or Housing Coordinator are hereby authorized to execute all documents relating to the approval and closing of any loans provided for in the Program. Section S. Authorization for Execution of Memorandum. 5.01. The Authority hereby approves the Memorandum substantially in the form presented to the Authority and authorizes its Chairman and Executive Director to execute the Memorandum on behalf of the Authority with such additions and modifications as those officers may deem desirable or necessary as evidenced by the execution thereof. 2.5 Page 3 - Resolution No. PASSED AND ADOPTED BY THE FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF FRIDLEY THIS DAY OF , 1993. LAWRENCE R. COMMERS - CHAIRPERSON ATTEST: WILLIAM W. BURNS - EXECUTIVE DIRECTOR 2.6 CERTIFICATION I, William W. Burns, Executive Director of the Housing and Redevelopment Authority in and for the City of Fridley, County of Anoka, Minnesota, hereby certify that the foregoing is a true and correct copy of Resolution No. passed by the Authority on the day of , 1993. WILLIAM W. BURNS - EXECUTIVE DIRECTOR 23 SCHEDULE A DESCRIPTION AND GUIDELINES FOR THE HOME IMPROVEMENT LOAN PROGRAM Loan Description M.H.F.A. Primary Loan: Rates from 3 -9.75% up to $15,000 for a maximum term of 15 years. Authority Deferred Loan: A percentage of the Primary Loan up to $2,250 as described below. Funding Sources Minnesota Housing Finance Agency for Primary Loan; Authority for Deferred Loan. Participating Lender Fridley State Bank. ualifications Income Limits: $41,000 Underwriting: Normal Bank Standards Equity: Normal Bank Loan to Value Percentage Property Type: Owner Occupied 1 to 4 Unit Properties Program Enhancements For a limited time period the Authority will defer part of the borrower's cost by providing a Deferred Loan without interest. Deferred Loan works as follows: M.H.F.A. Primary Authority Deferred Loan Loan Amount Percentage Maximum Limit < $5,000 10% $ 500 $5,001- $10,000 12.5% $1,250 > $10,001 15% $2,250 Authority Deferred Loan financing. property. 2.8 Loan will be secured, but subordinate to Primary Deferred Loan must be repaid upon sale of General Requirements Applications for the Home Improvement Loan Program will be accepted by the Authority, beginning on June T14, 1993 through July 16, 1993. Additional application periods may be established by the Authority. After the closing date, the applications will be reviewed for general eligibility (i.e.' compliance with income guidelines, property type, etc.), then those which meet this test will be ranked based on: 1) Age of property 2) Type of improvement 3) Location of property 4) Applicant's income Points will be awarded for each category; those with high scores will receive the first priority on program funds (including the program enhancements for the loan programs). Applicants for the loan programs will be directed to the participating lenders after a property inspection has been completed. In the event demand exceeds the funding supply, a waiting list will be maintained. MEMORANDUM OF UNDERSTANDING Home Improvement Loan Program THIS AGREEMENT, dated this day of , 19_, by and between the Fridley Housing and Redevelopment Authority (hereinafter referred to as the "HRA ") a public body corporate and politic existing under the laws of the State of Minnesota, and Fridley State Bank (here- inafter referred to as the "Lender ") a WITNESSETH: WHEREAS, the parties have discussed their joint participation in delivering the Minnesota Housing Finance Agency's Home Improvement Loan Program (hereinafter referred to as the "Program "); and WHEREAS, this agreement is not intended to void or supercede any agreement the Lender has with the Minnesota Housing Finance Agency (hereinafter referred to as the "MHFA") for the Program. NOW, THEREFORE, the parties hereto do hereby consent and agree as follows: 1. The purpose and intent of this agreement is to outline the responsibilities of each party with respect to funds provided by the HRA for deferred loans (hereinafter referred to as "Deferred Loan ") to be used in conjunction with the Program. 2. The HRA will perform a prescreening process to: a) Market the Program to residents of the City of Fridley. b) Take preliminary applications. c) Select a pool of candidates, by confirming compliance with the income limits and property type requirements for the Program and ranking candidates based on criteria established by the HRA. d) Request a cursory credit investigation from the Lender. e) Conduct an inspection of the candidate's property to determine the minimum improvements that must be included in the appli- cation. f) Refer candidates selected through the prescreening process to the Lender to make an application for the Program. 3. The Lender will perform the following functions: a) Maintain a supply of and assist applicants with the Program application. b) Process applications including income verification, loan underwriting, credit investigation, title check, document preparation and any other activities as defined in the MHFA Home Improvement Loan Procedural Guide and related participation documents. 4. The HRA will provide, subject to its approval, Deferred Loans to eligible borrowers. 5. Deferred Loans shall be defined as a loan without interest, secured to the property to be improved by a mortgage, in an amount equal to the following: Primary Loan Amount $0 - $5,000 $5,001 - $10,000 $10,001 - $15,000 HRA Deferred Loan lot of Primary Loan Amount not to exceed $500 12.5% of Primary Loan Amount not to exceed $1,250 15% of Primary Loan Amount not to exceed $2,250 2.9 S. (cont.) Said Deferred Loan may be applied either A) against the primary loan, or B) be used in addition to the primary loan, but only where the eligible improvement costs exceed what the Borrower has been approved to receive under the Program. Option B is subject to HRA approval. 6. Eligible borrowers (hereinafter referred to as the "Borrower ") are defined as those individuals who meet the criteria of the Program as defined by the MHFA Home Improvement Loan Program Procedural Guide and have been approved by the Lender. 7. The primary loan shall be defined as a loan approved by the Lender and financed through the Program. 8. The Lender Will submit a Request for Deferred Loan Commitment to the HRA on a form as evidenced by Exhibit A with the necessary attachments. The HRA shall have 5 business days from the receipt of the request to notify the Lender of its approval. The HRA will forward a check or transfer funds in the amount of the Deferred Loan to an escrow account maintained by the Lender on behalf of the Borrower. 9. The Lender shall ensure that the Borrower executes at the time Of closing all documents necessary to secure the Deferred Loan, including but not limited to the Deferred Loan Repayment Agreement and Mortgage (hereinafter referred to as the "Mortgagee) as evidenced by Exhibit B and an escrow agreement as evidenced by Exhibit C. 10. Further, Lender shall submit the Mortgage to Anoka County for Proper recording. Lender shall.submit to the HRA an invoice for all recording fees incidental to the Mortgage. The HRA shall provide the Lender with a supply of blank Mortgage forms. Upon receipt of the recorded mortgage from Anoka County, the Lender shall promptly return said document to the HRA. 11. The Lender shall disburse the Deferred Loan funds held in escrow to the Borrower upon receipt of a fully executed Completion Certificate, as evidenced by Exhibit D. 12. This agreement may be modified from time to time, but only in ion, writing and by mutual consent of the parties. In addition, this agreement may be terminated with or without cause io either party by giving at least 30 days written notice. IN WITNESS WHEREOF, the parties hereto, by and through their authorized representatives, have set their hands and executed this Agreement the day and date stated next to their signature. FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY The day of 19 By:_ Its: 19e day of By:_ FRIDLEY STATE BANK The day of 19 • By :_ Its: 19e day of By :_ C: wavwu Its: 2.10 Fridley Housing and Redevelopment Authority Home Improvement Loan Program REQUEST FOR DEFERRED LOAN COMMITMENT Date: To: Grant Fernelius Fridley HRA 6431 University Avenue N.E. Fridley, MN 55432 From: Fridley State Bank 6315 University Avenue N.E. Fridley, MN 55432 Borrower Information Name /s: Property Address: Please attach copies of the following documents to this form: - Signed Application - Credit Bureau Report - Income Verification - Title Verification - Contractor Bid /s - Contractor Warranty Loan Information 1) Home Improvement Loan Amount: $ 2) Requested Deferred Loan Amount $ 3) Estimated Closing Date: FRIDLEY STATE BANK Signature Title Phone No. KRA Approval Exhibit A 2.11 I hereby approve this Request for a Deferred Loan Commitment in the amount of $ to This Commitment will expire in 30 days, unless the HRA authorizes written extension. Approval is subject to the terms and conditions described in Memorandum of Understanding between Fridley HRA and Fridley State Bank. Signature Title Date Exhibit B 2.12 FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY HOME IMPROVEMENT LOAN PROGRAM DEFERRED LOAN REPAYMENT AGREEMENT AND MORTGAGE THIS AGREEMENT, made and entered into this day of , 19 , (hereinafter referred to as "Effective Date "), by and between (hereinafter collectively referred to as "Borrower "), and 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, having its principal office at 6431 University Avenue N.E., Fridley, Minnesota 55432 (hereinafter referred to as "Lender "). WHEREAS, on Lender agreed to provide Borrower with a no interest loan (hereinafter referred to as "Deferred Loan "), in the amount of Dollars ($ ), the receipt of which is hereby acknowledged by Borrower, for the purpose of completing rehabilitation work on the real estate legally described below; and WHEREAS, Borrower and Lender desire to set forth herein the provisions for Borrower's repayment of the Deferred Loan, and to provide for securing said repayment with a mortgage (hereinafter referred to as "Mortgage ") on the real estate legally described below. NOW, THEREFORE, in consideration of said Deferred Loan and in accordance with Minnesota Statutes, the parties do hereby agree as follows: 1. Borrower covenants and agrees with Lender to pay to the order of Lender he principal sum of the Deferred Loan, without interest, at the Office of Lender in Fridley, Minnesota, or at such other place as Lender may designate in writing delivered or mailed to Borrower, upon the occurrence of any of the following events after the Effective Date: a. When the real estate legally described below is sold, transferred, or otherwise conveyed (whether by deed, contract for deed, or otherwise); and whether voluntary or involuntary, either while Borrower is living or by reason of the death of Borrower (excluding the transfer of said property by operation of law or devise to a surviving Borrower joint tenant or former joint tenant in common, for so long as said surviving Borrower joint tenant, devisee or owner occupies said property as his or her principal place of residence); or b. When the real estate legally described below ceases for any reason to be Borrower's principal place of residence. paragraphyI shall be madefn telater than the thirtieth hirtunder h (30h) day after tthe earlier of the following: (a) the date of the sale, transfer, or other conveyance referred to in paragraph 1(a), above, or (b) the date upon which the real estate ceases to be Borrower's principal place of residence as provided in paragraph 1(b) thereof. 2. As security for Borrower's personal covenant and obligation for repayment as herein provided, and subject to the terms and conditions of this Agreement, Borrower hereby grants, and the Lender shall and hereby does have, a Mortgage lien on the real estate legally described below, together with all hereditaments and appurtenances thereto, in the full amount necessary to satisfy repayment of said Deferred Loan. The said real estate subject to said Mortgage lien is situate in Anoka County, Minnesota, and is legally described as follows: -1- 3. Promptly after the date of any sale, transfer or other conveyance of 2.13 the above - described real estate, or.promptly after the date upon which said real estate ceases to be Borrower's principal place of residence, Borrower or his /her heirs, executors, representatives, hereby covenant and agree to give notice to Lender thereof. 4. In the event Borrower or his /her heirs, executors, representatives shall fail or refuse to make a required payment within said limited period as described in paragraph 1, Lender may, with or without notice to Borrower, foreclose said lien in the same manner as action for foreclosure of mortgages upon real estate, as provided by statute. 5. This Agreement shall run with the aforesaid real estate and shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, representatives, successors, and assigns. 6. If this Agreement is executed by a contract for deed vendor of the property, as one of the Borrower's, such execution shall be deemed for the purpose of establishing and continuing the existence of the indebtedness described herein and the lien granted herein. However, in the event of default of the terms hereof, neither Lender nor its assigns shall take any action against such contract for deed vendor except such as may be necessary in order to subject to the satisfaction of said indebtedness of the real estate legally described herein. IN TESTIMONY WHEREOF, the parties have executed this Agreement as of the day and year first above written. BORROWER STATE OF MINNESOTA ss. COUNTY OF FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY By: Its: By: Its: On this day of , 19 , before me a Notary Public within and for said County, personally appeared , to me known to be the persons) described in, and who executed the foregoing instrument, and acknowledged that he_ executed the same as free act and deed. STATE OF MINNESOTA ss. COUNTY OF Notary Public On this day of , 19 , before me a Notary Public within and for said County, personally appeared , to me known to be the person(s) described in, and who executed the foregoing instrument, and acknowledged that _he_ executed the same as free act and deed. Notary Public -2- STATE OF MINNESOTA ss. COUNTY OF On this day of , 19 , before me a Notary Public within and for said County, personally appeared , to me known to be the persons) described in, and who executed the foregoing instrument, and acknowledged that he executed the same as free act and deed. Notary Public STATE OF MINNESOTA ) COUNTY OF ) ss. ) On this day of , 19 , before me a Notary Public within and for said County, personally appeared n, and who executed the foregoing instrument, and acknowl dged thatscrhe executed the same as free act and deed. -- Notary Public Tax Statements for the real property described in this instrument should be sent to: This instrument was drafted by. Fridley Housing and Redevelopment Authority 6431 University Avenue N.E. Fridley, Minnesota 55432 ? ?? exempt from mortgage registration tax ? ?? -3- B:\REPAYMEN 2.14 Exhibit c 2.15 FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY HOME IMPROVMENT LOAN PROGRAM ESCROW AGREEMENT THIS AGREEMENT, made and entered into this day of , 19 (hereinafter referred to as the "Effective Date ") by and between 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, having its principal office at 6431 University Avenue N.E., Fridley, Minnesota 55432 (hereinafter referred to as "Agent "), and (hereinafter collectively referred to as "Borrower" WHEREAS, on Agent agreed to provide Borrower with a no- interest loan (hereinafter referred to as "Deferred Loan ") , in the amount of Dollars ($ ), for the.purpose of completing rehabilitation work on the real estate legally described below (SEE EXHIBIT 1); and WHEREAS, said Deferred Loan was funded in conjunction with primary financing obtained through the Minnesota Housing Finance Agency's Home Improvement Loan Program (hereinafter referred to as "Primary Loan "); and WHEREAS, proceeds from said Primary Loan have already been disbursed to Borrower for the purpose of completing rehabilitation work on the real estate legally described below (SEE EXHIBIT 1); WHEREAS, Borrower and Agent desire that the proceeds of said Borrower's Deferred Loan be placed into an escrow account for distribution to a contractor, so as to be assured that the Deferred Loan funds will be devoted for the purposes of completing eligible improvements as described in the Borrower's Credit Application. NOW, THEREFORE, the parties do hereby agree as follows: 1. Borrower shall and hereby does deposit the proceeds of the Deferred Loan in the amount of $ , with Agent, the receipt of which is hereby acknowledged by Agent, to be placed into Agent's trust account for disbursement in.the manner hereinafter provided. 2. That the funds held in escrow be released to the Borrower after completion of all improvements and satisfactory inspection by Agent. 3. That the borrower is responsible for ensuring that all work is in compliance with state and local codes and all necessary permits are obtained, and further that all contractors are properly licensed, bonded and insured. 4. That Borrower and Agent execute a Completion Certificate prior to disbursement of said funds held in escrow. 5. The parties hereto agreee that upon the discharge of the duties undertaken herein by Agent in accordance with the provisions as set forth, the Agent shall have no further liability to the Borrower arising from this Escrow Agreement. 6. This Escrow Agreement is not assignable without mutual written consent of both parties. 7. This Escrow Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, exec- utors, administrators, successors, and assigns. Page 1 IN WITNESS WHEREOF, the parties hereto have executed this Escrow Agreement the day and year first above written. IN PRESENCE OF: (Witness) IN PRESENCE OFs (witness) (Witness) E%HIBIT 1 Legal description of property, to wit: Page 2 AGENT Fridley Housing and Redevelopment Aut ority (Signature of Agent) BORROWER (Signature of Borrower) (Signature of Borrower) 2.15 e s Fridley Housing and Redevelopment Authority Home Improvement Loan Program Borrower /s Loan Number BORROWER Completion Certificate Address I (we) hereby certify that all of the work described in - application has been completed and is in full compliant terms and conditions of the Escrow Agreement dated Borrower Borrower AGENT Date Date 2.16 Exhibit D my credit e with the The undersigned hereby certifies that the above - referenced work has been completed and inspected and meets the requirements of Fridley Home Improvement Loan Program. The funds held in escrow may be disbursed to the borrower. Fridley Housing and Redevelopment Authority Housing Coordinator Inspector B: \COMPFORM Date Date r� 3.1 Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 1, 1993 TO: William Burns, Executive Director of HRA1� FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Resolution Authorizing Home Mortgage Assistance Program Proposed for HRA consideration is the second resolution which must be adopted. This resolution pertains to the. Home Mortgage Assistance Program. The resolution authorizes the following: 1. Establishment of the program and area of operation. 2. Delegates certain powers and duties. 3. Execution of a Mortgage Origination Agreement with United Mortgage. This program provides assistance to homeowners /homebuyers for down payment, closing costs, and /or home rehabilitation work. HRA funds will be issued in the form of a deferred payment loan that does not have to be repaid until the owner sells his /her home. For homeowners, there are two options: 1. Refinance and Rehab An owner can receive a deferred payment loan for up to 5% of the mortgage amount not to exceed $6,000. Restrictions: First mortgage cannot exceed $120,000. Home value cannot exceed $126,000. At least 10% of the mortgage must be used for home rehabilitation. 2. Rehab Only An owner who wishes to complete the minimum of $15,000 worth of rehab can receive a deferred payment loan for up to 10% of the rehab mortgage amount not to exceed $3,795. In addition to any closing costs, the HRA funds can also be used to pay for part of the rehab work. 3.2 Resolution Authorizing Home Mortgage Assistance Program July 1, 1993 Page 2 For homebuyers, there are two options as well: 1. Purchase and Rehab A buyer can receive a deferred payment loan for up to 5% of the first mortgage amount not to exceed $6,000. Restrictions: Same as Refinance and Rehab Option. 2. Purchase Only This option is only available to buyers who will be converting the property from non - homestead status to homestead status. The HRA will provide a deferred loan for up to 3% of the first mortgage amount, not to exceed $3,600. Restrictions: First mortgage cannot exceed $120,000. Home value cannot exceed $126,000. After the pre- screening process has been completed, the HRA will perform an inspection of the property to ensure code - related repairs are made. Applicants will then have 30 days to make a mortgage application with United Mortgage. GF:ls M -93 -392 zz 3.3 RESOLUTION NO. A RESOLUTION ESTABLISHING A HOME MORTGAGE ASSISTANCE PROGRAM; ESTABLISHING THE AREA OF OPERATION; PROVIDING FOR THE DELEGATION OF CERTAIN POWERS AND DUTIES; AUTHORIZING THE EXECUTION OF A MORTGAGE ORIGINATION AGREEMEri'1' BY AND BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY AND UNITED MORTGAGE CORPORATION. BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority "), as follows: Section 1. Recitals. 1.01. It has been proposed that the Authority establish a Home Mortgage Assistance Program (the "Program ") for the residents of the City of Fridley (the "City "). 1.02. It has been further proposed that the Authority enter into the necessary agreements to implement the Program including a Mortgage Origination Agreement (the "Origination Agreement ") with United Mortgage Corporation (the "Bank ") as participating lender. Section 2. Findings. 2.01. The Authority hereby finds that its area of operation in which to implement the Program is the area within the territorial boundaries of the City as provided for in Minnesota Statutes, Section 469.002, Subd. 8. 2.02. The Authority hereby finds that the adoption of the Program promotes the purposes of the Authority as those purposes are defined in Minnesota Statutes, Section 469.001, et sea. (the "Act "). 2.03. The Authority hereby finds that the Program will assist in the alleviation of shortages of decent, safe and sanitary residential housing available within the City at prices affordable to persons and families of low or moderate income as described therein. 2.04. The Authority hereby finds that preservation of the quality of life in the City is dependent upon the maintenance, provision, and preservation of an adequate housing stock; that a6complishing this is a public purpose in that there are many residences in the City which require rehabilitation; that a need exists to provide in a timely fashion affordable housing to persons of low and moderate income as described in the Act and herein residing and expected to reside in the City; that many owners, would -be 34 A Page 2 - Resolution No. purchasers or providers of residences are unable to obtain mortgage credit for rehabilitation of residences under current market conditions; and that in establishing its Program the Authority is acting in all respects to benefit the citizens of the City and to serve a public purpose in improving and otherwise promoting their health, welfare and prosperity. Section 3. Authorization of Program. 3.01. The Authority hereby approves and adopts the Program as described in the Origination Agreement and on Schedule A attached to this Resolution. Section 4. Delegation of Power and Duties. 4.01. In accordance with the Act, specifically Minnesota Statutes, Section 429.012, Subd. 1(3), and in accordance with the Program Description and Guidelines, the officers, agents and employees of the Authority are hereby authorized to take such actions as may be necessary to implement the Origination Agreement and operate the Program. 4.02. The Executive Director or Housing Coordinator are hereby authorized to execute all documents relating to the approval and closing of any loans provided for in the Program. Section 5. Authorization for Execution of the Origination Agreement. 5.01. The Authority hereby approves the Origination Agreement substantially in the form presented to the Authority and authorizes its Chairman and Executive Director to execute the Origination Agreement on behalf of the Authority with such additions and modifications as those officers may deem desirable or necessary as evidenced by the execution thereof. I- w 3.5 Page 3 - Resolution No. PASSED AND ADOPTED BY THE FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF FRIDLEY THIS DAY OF Ir 1993. LAWRENCE R. COMMERS - CHAIRPERSON ATTEST: WILLIAM W. BURNS - EXECUTIVE DIRECTOR 3.6 CERTIFICATION I, William W. Burns, Executive Director of the Housing and Redevelopment Authority in and for the City of Fridley, County of Anoka, Minnesota, hereby certify that the foregoing is a true and correct copy of Resolution No. passed by the Authority on the day of , 1993. WILLIAM W. BURNS - EXECUTIVE DIRECTOR W 3.7 SCHEDULE A DESCRIPTION AND GUIDELINES FOR THE HOME MORTGAGE ASSISTANCE PROGRAM Loan Description No- interest, deferred payment loan (Deferred Loan) for help with down payment, closing costs and home rehabilitation. Funding Source The Authority. Participating Lender United Mortgage Corporation. Qualifications Income Limits: $55,000 Underwriting: Normal Bank Standards Equity: Normal Bank Loan to Value Percentage Property Type: Owner Occupied 1 to 4 Unit Properties Program Specifics As described above, this program provides down payment and closing cost assistance to both homebuyers and homeowners. Homeowners who wish to either: 1) Refinance and rehab their home, receive a Deferred Loan of 5% of the first mortgage, not to exceed $6,000. Restrictions: a) 10% of the total mortgage amount must be used for rehabilitation. b) Mortgage cannot exceed $120,000. c) Home value cannot exceed $126,500. FHA, VA or conventional first mortgage financing is eligible. 2) Rehabilitate their homes, receive a Deferred Loan of 10% of the mortgage amount, not to exceed $3,795. Funds may be used for closing costs and home rehabilitation. 3.8 Restrictions: a) Minimum amount of rehab $15,000; maximum not to exceed 30% of home value or $37,950. For homebuyers who wish to: 1 ) Purchase a home, the Deferred Loan is 3% of the first mortgage amount, not to exceed $3,600. Restrictions: a) Only allowed for the conversion of non - homestead property to homestead property. b) Maximum mortgage cannot exceed $120,000. Home value cannot exceed $126,500. 2) Purchase and rehab a home, the Deferred Loan is 5% of the mortgage amount, not to exceed $6,000. Restrictions: a) Same as with homeowners who wish to refinance and rehab their home as descried above. General Requirements Applications for the Home Mortgage Assistance Loan Program will be accepted by the Authority, beginning on June 14, 1993 through July 16, 1993. Additional application periods may be established by the Authority. After the closing date, the applications will be reviewed for general eligibility (i.e. compliance with income guidelines, property type, etc.), then those which meet this test will be ranked based on: 1) Age of property 2) Type of improvement 3) Location of property 4) Applicant's income Points will be awarded for each category; those with high scores will receive the first priority on program funds (including the program enhancements for the loan programs). Applicants for the loan programs will be directed to the participating lender. In the event demand exceeds the funding supply, a waiting list will be maintained. 4 CITY OF FRIDLEY HOUSING REHABILITATION PROGRAM MIDDLE INCOME HOUSING PROGRAM MORTGAGE ORIGINATION AGREEMENT By and Between Lender and the City of Fridley HRA Dated as of July _,1993 Lender's Deferred Loan Allocation S a a TABLE OF CONTENTS Pa Preamble..................................................................................... ............................... 1 ARTICLE I Definitions, Rules of Interpretation and Standards Section1.01. Definitions ............................................................. ............................... 2 Section 1.02. Rules of Interpretation ........................................... ............................... 6 Section1.03. Standard ................................................................ ............................... 7 ARTICLE II Representations Section 2.01. Representations, Warranties and Covenants of the Issuer ....................... 8 Section 2.02. Representations, Warranties and Covenants of the Lender ..................... 8 ARTICLE III Program Allocations; Transfer of Program Allocation Section 3.01. Initial Program Allocation ...................................... ............................... 11 Section 3.02. Transfer by a Lender of its Program Allocation ...... ............................... 11 Section 3.03. Revocatoin or Termination of Program Allocation .. ............................... 11 ARTICLE IV Origination Period; Commitment to Sell and Purchase Deferred Loans Section 4.01. Originiation Period .................................................. ..........................::... 12 Section 4.02. Commitment to Sell and Purchase Deferred Loans .. ............................... 12 Section 4.03. Timing of Funding of Deferred Loans ...................... ............................... 12 Section 4.04. Preliminary Deferred Loan Approval; Recertification .............................. 12 Section 4.05. Maintenance of Mortgage Files ................................ ............................... 15 Section 4.06. Defective Documents and Non - Qualifying Loans; Repurchase of Deferred Loans by Lender ......... ............................... 15 Section 4.07. Monthly Status Report ............................................ ............................... 16 ARTICLE V Deferred Loan and Primary Loan Requirements Section5.01. General ................................................................... ............................... 18 Section 5.02. Deferred Loan Terms .............................................. ............................... 18 P Section 5.03. Primary Loan Terms ................................................ ............................... 19 Section 5.04. Mortgagors - Income Requirements ......................... ............................... 19 Section 5.05. No First -Time Homebuyer Requirement .............. ............................... 20 Section 5.06. Maximum Mortgage Amount ................................... ............................... 20 Section 5.07. Eligible Homes; Two -Unit Homes; Personal Property .............................. 20 Section 5.08. No Discrimination .................................................... ............................... 21 Section 5.09. New Mortgages ....................................................... ............................... 21 Section 5.10. Refinancing/Rehabilitation Loans ............................... ............................... 21 Section 5.11. Acquisition/Rehabilitation Loans ............................... ............................... 22 Section 5.12. Origination Fees and Closing Costs, Disbursement of DeferredLoans ................................................... ............................... 22 ARTICLE VI Lenders Obiligation to Verify Mortgage Requirements; Lenders Representations as to Loans Section 6.01. Independent Verfications by Lender .......................... ............................... 23 Section 6.02. Representations, Warranties and Covenants of Lender ConcerningLoans ............................................... ............................... 24 ARTICLE VII Servicing of Deferred Loans Section 7.01. Lender to Service Deferred Loans ............................. ............................... 28 Section7.02. No Assumptions ........................................................ ............................... 28 ARTICLE VIII Lender Section 8.01. Liability of Lender ..................................................... ............................... 29 Section 8.02. Merger or Consolidation of Lender ............................ ............................... 29 Section 8.03. Limitation on Liability of Directors, Officers, Employees and Agents of Lender .......................... ............................... 29 Section 8.04. Lender Not to Resign ................................................ ............................... 29 Section 8.05. Access to Certain Documentation and Certain Information Regarding the Deferred Loans ........... ............................... 29 Section8.06. Notifications .............................................................. ............................... 29 ARTICLE IX Termination, Defaults and Remedies Section 9.01. Cause of Termination Defined; Remedies ................. ............................... 30 Section 9.02. Appointment of Successor ........................................ ............................... 31 Section 9.03. No Remedy Exclusive .............................................. ............................... 31 Section 9.04. Agreement to Pay Attorneys' Fees and Expenses ...... ............................... 31 Section 9.05. Liability of Fridley .................................................... ............................... 31 Section 9.06. Survival upon Termination ....................................... ............................... 31 7 ARTICLE X Miscellaneous Provisions Section 10.01. Revisions by Supplemental Notice ........................... ............................... 32 Section 10.02. Other Amendments, Changes and Modifications ...... ............................... 32 Section 10.03. Recordation of Agreement ..................................... 32 ............................... Section 10.04. Governing Law ...................................................... ............................... Section10.05. Notices 32 .................................................................. ............................... Secton10.06. Severability 33 ............................................................ ............................... Section 10.07. Further Assurances and Corrective Instruments ...... ............................... 33 33 Section 10.08. Term of Agreement .... ............................... 33 ........ ........ .... ....................... Section 10.09. No Rights Conferred on Others ............................. ............................... Section 10.10. Discretion of Issuer 33 .......... ............................... ................ ..................... Section 10.11. Counterparts 33 .................... ............................... .......... ........................... 33 Section 10.12. Forms of Exhibits; Guidelines ................................ ............................... 33 Section 10.13. Limitation on Liability of Directors, Officers, Employees and Agents .... 34 Signatures.................................................................................... ............................... 35 Exhibit A Exhibit B Exhibit C Exhibit D Exhibit E Exhibit F Exhibit G Exhibit G -1 Exhibit H Exhibit H -1 Exhibit I Exhibit J Exhibit K Exhibit L Exhibit M Exhibit N TO FOLLOW E:7 A P MORTGAGE ORIGINATION AGREEMENT THIS MORTGAGE ORIGINATION AGREEMENT, dated as of July _, 1993, is by, between and among: (1) the City of Fridley Housing and Redevelopment Authority (or the "Issuer "); (2) the entity designated as Lender on the cover page and the Lender's signature page hereof (the "Lender "). WITNESSETH: WHEREAS, the Issuer has made available fund to provide funds to acquire Deferred Loans made to low and moderate income persons or families at below - market interest rates; V4-1EREAS, the Lender has offered to originate Deferred Loans which comply with all of the requirements of this Agreement and to sell such Deferred Loans to the Issuer as provided herein; WHEREAS, the Issuer has determined to implement a housing finance program in the jurisdictions of the City of Fridley, Minnesota, to finance a portion of the cost of acquisition and rehabilitation of Homes (as hereinafter defined) by low or moderate income persons or families at below - market interest rates; and WHEREAS, the Lender has offered to originate Deferred Loans as provided in this Agreement for sale by the Lender to the Issuer pursuant to the Issuer's housing finance program, and the Issuer has accepted the Lender's offer. Therefore, for and in consideration of the premises and the mutual covenants, representations, and agreements hereinafter contained, the parties hereto hereby agree as follows: ARTICLE I Definitions, Rules of Interpretation and Standards Section 1.01. Definitions. The following words and phrases shall have the following meanings: "Acquisition/Rehabilitation Loan" means a Primary'Loan made to acquire and Rehabilitate a Home, which complies with the requirements of Section hereof. "Agreement" means this Mortgage Origination Agreement and all Supplemental Notices, exhibits, amendments and supplements thereto and hereto. "Annual Family Income" has the meaning given it in Section (b) hereof. "Business Day" means any day other than (i) a Saturday or Sunday or (ii) a day on which banking institutions in Minneapolis, Minnesota are authorized or required by law or executive order to close and offices of the Issuer are open for business. "City" means the City of Fridley. "Closing Date" means date on which a Deferred Loan is closed by the Lender. "Commit" or "Commitment" means a binding written commitment by the Lender to a prospective Mortgagor, in a form customarily used in the mortgage lending industry, to finance the purchase or rehabilitation of a particular Home with a Primary Loan and a Deferred Loan, which Commitment shall specify a stated expiration date and stated principal amount for each loan and a maximum interest rate for the Primary Loan and a stated rate for the Deferred Loan. "Cure Period" shall have the meaning assigned to it in Section "Default" means one of the events specified in Section "Defect" or "Defective" shall have the meanings assigned such terms in Section "Deferred Loan" means the loan made by the Lender to a Mortgagor which loan is evidenced by a Deferred Note and secured by a Deferred Mortgage and which loan is purchased by the Issuer. Each Deferred Loan shall have the terms and be in an amount as provided in Section hereof "Deferred Loan Rate" means the interest rate per annum with respect to the Deferred Loans, which rate of interest shall be 1% per annum simple interest. "Deferred Mortgage" means the written instrument securing the related Deferred Loan and encumbering a Home, which instrument shall be in the form of Exhibit_ attached hereto. Each Deferred Mortgage shall be subordinate to the related Primary Mortgage. 10 "Deferred Note" means the promissory note executed to evidence the Mortgagor's obligation to repay the Deferred Loan, in substantially the form of Exhibit _hereof. "Errors and Omissions Insurance Policy" means a standard form insurance policy acceptable to the Issuer, in form and substance as required by the FHLMC or FNMA, insuring against losses from errors or omissions in the conduct of a business. "Fidelity Bond" means a standard form fidelity bond, in form and substance as required by FNMA. "FNMA" means the Federal National Mortgage Association, or any successor to its functions. "FNMA Guide" means the FNMA Selling Guide then in effect on the date of its application, if any, hereunder. "Home" means residential real property located in the City and eligible for financing with a Deferred Loan pursuant to Section "HUD" means the United States Department of Housing and Urban Development, and any successor to its functions. "Income Limit" means the maximum Annual Family Income permitted under the Program for determined pursuant to Section "Issuer" means the City of Fridley Housing and Redevelopment Authority. "Lender" means the lending institution referenced on the cover page hereof and which executed this Agreement on the final execution page hereof. As the context may require, the term "Lenders" further includes all, or any one, of the financial institutions (including the Lender) which have signed agreements with the Issuer similar to this Agreement with respect to the Program. "Maximum Mortgage Amount" means the maximum mortgage amount permitted by the program, determined pursuant to Section "Mortgage File" means the mortgage documents (or photocopies, microfilm or micro fiche copies thereof) listed in Exhibit—to this Agreement pertaining to a particular Deferred Loan and the related Primary Loan. "Mortgagor" means any person who has a present ownership interest in a Home subject to a Deferred Loan and/or executes the Deferred Mortgage (but does not include any person who executed a Deferred Note only as a guarantor or co- signor and who does not occupy the Home or have such a present ownership interest). 11 "Mortgagor Survey" means the Mortgagor Survey Form attached as Exhibit _and required by Section for each Deferred Loan. "Mortgagor's Affidavit and Certification" means the forms of Mortgagor's Certification as to Income and Residency, Mortgagor's Affidavit and Certification, attached hereto as Exhibit_ (as such Exhibit may be modified pursuant to Section , on which each prospective Mortgagor must certify certain matters to comply with the requirements of this Agreement. "Non- Qualifying Loan" shall have the meaning assigned to it in Section "Notice Address" means: (a) As to the Issuer: Grant Fernelius City of Fridley 6431 University Ave. NE Fridley, MN 55432 (b) As to the Lender, the address shown on the Lender's execution page of this Agreement. "Notice of Acceptance" means the notice executed by the Issuer and delivered to the Lender accepting the Lender's offer to originate Deferred Loans pursuant to this Agreement. 12 R "Origination Period" means the period of time stated in the Notice of Acceptance which shall end on , 199, unless extended by the Issuer. "Permitted Encumbrances" means liens, encumbrances and clouds on the legal title of a Home permitted by FNMA. "Primary Loan" means the first or second mortgage loan made by the Lender to the Mortgagor with respect to a Home in conjunction with a Deferred Loan, which primary loan is one of the types specified in Section hereof . "Primary Mortgage" means the written instrument securing the related Primary Loan and encumbering a Home, which instrument shall be the then - effective FNMA with a rider in substantially the form of Exhibit _hereto. "Primary Note" means the promissory note executed to evidence the Mortgagor's obligation to repay the Primary Loan, which shall be the then - effective form of mortgage note required by FNMA, approved under the GNMA Guide, with such modifications or riders or addenda as may be required by the terms hereof and with a rider in the form of Exhibit _hereto. "Program" means the program to purchase with proceeds of the Bonds, Deferred Loans made to finance a portion of the cost of acquisition and / or rehabilitation of Homes by qualifying Mortgagors. "Program Allocation" has the meaning given it in Section hereof. "Qualified Appraiser" means a FNMA qualified appraiser. "Qualifying Loan" means a Deferred Loan which meets the requirements of this Agreement and is eligible to be purchased by the Issuer. "Refinance/Rehabilitation Loan" means a Primary Loan made to refinance the Mortgagor's existing financing with respect to the Home and to finance Rehabilitation, as provided in Section hereof. "Rehabilitation" means the improvement of a Home to improve the basic livability of the Home or the improvement of the Home to a decent, safe and sanitary condition, requiring more than routine or minor repairs or improvements . Such work may very in degree from gutting and extensive reconstruction to cosmetic improvements coupled with cure of a substantial accumulation of deferred maintenance, and may include the construction or rehabilitation of an attached or detached garage and a driveway, room additions, repair of sidewalks, improvement to achieve energy efficiency and other similar expenditures, but not including the improvement of sheds, storage facilities or other buildings or facilities attached to or adjacent to a Home other than a garage (or driveway), and not including swimming pools, decks, patios, saunas, spas or other purely recreational facilities. All rehabilitation work must be done by bonded contractors. 13 "Request for Approval" means the document set forth in Exhibit _ hereto, with all attachments required therein. "Seller" means the person or entity which sells a Home to a Mortgagor, which term shall not include any real estate agent or broker unless such agent or broker holds an ownership interest in the Home. "Seller Survey" means the Seller Survey Form attached as Exhibit I and required by Section for. each mortgage Loan. "State" means the State of Minnesota, and any successor to its functions. "Supplemental Notice" means a written notice from the Issuer to all affected Lenders, by which the Issuer exercises its reserved right to modify certain provisions of this Agreement as provided in Section Section 1.02. Rules of Interpretation The following principles govern the interpretation of other words: and phrases used in this Agreement: (a) Captions, titles or headings precedingany article, section or subsection herein, and any table of contents or index attached hereto, are solely for convenience of reference and are not part of this agreement, and shall not affect its meaning, construction, or effect. (b) Terms such as "herein ", "hereunder ", "hereby ", and "hereof' refer to this Agreement and not to any particular section hereof unless so indicated; "heretofore" and "hereafter" mean before and after the date of execution and delivery of this Agreement. (c) Words importing the masculine, feminine or neuter genders include the other genders. (d) Except as to Mortgagors, words importing persons include firms, associations, corporations, and other entities. (e) Words importing the singular number include the plural number, and vise versa. (f) All references in this instrument to designated "Articles ", "Sections ", "Exhibits ", "Schedules" and other subdivisions are to the designated Articles, Sections, Exhibits, Schedules and other subdivisions of this instrument as originally executed or to Exhibits or Schedules as modified, amended or replaced pursuant hereto . (g) All accounting terms not otherwise defined herein have -the meanings assigned to them in accordance with generally accepted accounting principles. 14 0 (h) Words or terms in this Agreement capitalized but not defined herein shall have the meaning given those words or terms in the Resolution. (i) Articles, sections, subsections, clauses and exhibits mentioned by number or letter only are those so numbered or lettered which are contained in this Agreement . Section 1.03. Standard . The Lender shall perform its duties and obligations under this Agreement with the degree of care and skill ordinarily exercised by mortgage lenders located or doing business in the City; except that to the extent that this Agreement imposes a higher or different standard upon the Lender, the Lender shall comply with such higher or different standard. 15 ARTICLE II Representations Section 2.01 . Representations Warranties and Covenants of the Issuer. The Issuer represents and warrants to, and covenants with, the Lender and the Issuer that: (a) Public Purposes. The Issuer has found and determined that the purchase of Deferred Loans under the terms hereof and the Resolution will assist in the alleviation of shortages of decent, safe and sanitary residential housing available within the City at prices affordable to persons and families of low or moderate income as described herein. The Issuer has found and determined that preservation of the quality of life in the City is dependent upon the maintenance, provision, and preservation of an adequate housing stock; that accomplishing this is a public purpose in that there are many residences in the City which require rehabilitation; that a need exists to provide in a timely fashion affordable housing to persons of low and moderate income as described in the Act and herein residing and expected to reside in the City; that many owners, would -be purchasers or providers of residences are unable to obtain mortgage credit for Rehabilitation of residences under current market conditions; and that in establishing its Program the Issuer is acting in all respects to benefit the citizens of the City and to serve a public purpose in improving and otherwise promoting their health, welfare and prosperity. (b) Compliance: Power and Authority. The Issuer has complied with all of the provisions of the Constitution and laws of the State, this Agreement, the Resolution and the transactions contemplated thereby, and has full power and authority to consummate all transactions contemplated by this Agreement, the Resolution and the Bonds and any and all other agreements, documents and instruments relating thereto. Section 2.02. Representation Warranties and Covenants of the Lender. The Lender represents and warrants to, and covenants with, the Issuer that: (a) Due Organization and Authority The Lender is a public body corporate and duly organized and existing under the laws of the State of Minnesota, is duly authorized to transact business in the State, and customarily provides service or otherwise aids in financing mortgages located in the State. (b) Supervision. Merger or Consolidation The Lender agrees that during the term of this Agreement its mortgage lending activities will remain subject to supervision and examination by State or federal authorities, as may be applicable, and that it will remain in good standing and qualified to do business under the laws of the United States of America and the State of Minnesota, will not dissolve or otherwise dispose of all or substantially all of its assets, and will not voluntarily consolidate with or merge into any other entity or permit one or more other entities to consolidate with or merge into it, provided, that the Lender may, without violating this subsection, with the prior written consent of the Issuer consolidate with or merge into another 16 b r entity, or permit one or more entities to consolidate with or merge into it, or sell or otherwise transfer to another such entity all or substantially all of its assets as an entirety and thereafter dissolve; provided that the mortgage lending activities of the surviving, resulting or transferee entity, as the case may be, shall be subject to the supervision and examination of the State or federal authorities, as may be applicable, and shall assume in writing all of the obligations of the Lender hereunder, and in such case the Issuer shall release the Lender in writing, concurrently with, and contingent upon such assumption, from all liability hereunder. The lender shall not transfer or assign its rights under this Agreement other than as provided in the preceding paragraph without the prior written consent of the Issuer . (c) Power and Authority. The Lender has full power and authority to execute and deliver its Offer to Originate and this Agreement, to accept the terms hereof, and to enter into the transactions contemplated hereby, and the execution, acceptance and performance hereof has been duly authorized by all necessary corporate and other action. (d) No Conflict or Breach. The execution and delivery of the Offer to Originate and this Agreement, the consummation of the transactions contemplated hereby, and.the fulfillment of or compliance with the terms and conditions hereof, do not conflict with or result in any breach or violation of any of the terms, conditions or provisions of any applicable laws, regulations, rules, orders or decisions, or any agreement or instrument, to which the Lender is now a party or by which it is bound, or constitute a default under any of the foregoing. (e) Authorized to Make Loans. The Lender is currently authorized to make mortgage loans eligible for purchase by FNMA under the FNMA Guide. (f) FNMA. The Lender is an FNMA- approved mortgagee in good standing. (g) FNMA Compliance. The Lender will comply, as to the Primary Loans with the FNMA Guide and with all FNMA rules and regulations of FNMA applicable to the Primary Loans, (ii) with respect to each Primary Loan, with all the requirements of, and the "Representations and Warranties of Lender" set forth in, the [FNMA Guide], (iii) as to each Primary Loan and each Deferred Loan, the provisions of this Agreement, and (iv) any and all applicable laws governing or regulating the origination of mortgage loans. (h) No FiduciM Relationship or Interest in Funds. Notwithstanding any other provisions of this Agreement, under no circumstances shall this Agreement or the relationship between the Issuer and Lender created thereby be construed as creating a fiduciary relationship between the Issuer and Lender, or as granting to, or creating in, the Lender any legal or equitable interest, right or title in or to any funds or assets held under the Resolution. 17 (i) Indemnification. The Lender will indemnify and hold harmless the Issuer, and their officers, directors, employees and agents against liability for all claims, causes of action, costs and expenses (including attorneys' fees), judgments, fines and penalties that may be related to or arise out of any act or omission of the Lender hereunder or any violation of law resulting from an act or omission of the Lender hereunder. 6) Nondiscrimination. The Lender will comply with the applicable nondiscrimination provisions of the Civil Rights Act of 1964, the regulations promulgated thereunder, and Executive Order 11 246, Equal Employment Opportunity, dated September 24, 1965. (k) Performance. The Lender fully recognizes that the obligation of the Lender contained in this Agreement does not constitute an obligation of the Lender only to make a good faith effort to perform hereunder and that the Lender is not able to resign its duties hereunder, but rather that the failure to perform is an event of Default and may result in the enforcement of any or all of those remedies and damages set forth herein. (1) Expectation of Performance At the date hereof and the date of the actual execution hereof, the Lender does not believe, nor does it have any reason or cause to believe, that it cannot perform each and every covenant and agreement contained in this Agreement. (m) Representations in Certificates The representations and information set forth in the certificates and other documents to be provided to the Issuer in connection with the purchase by the Issuer of each Deferred Loan will be true and accurate and may be relied upon by the Issuer. (n) No Litigation. There is no litigation pending, or, to the Lender's knowledge, threatened, affecting the right of any of the present members of the governing body (whether a board of directors or board of commissioners or other group) or officers of the Lender to their respective offices or their jurisdiction or authority over the affairs of the Lender, nor in any way questioning the execution or validity of this Agreement; there are no other legal or governmental proceedings other than ordinary routine litigation incidental to the business conducted by the Lender pending or (to the best of the Lender's knowledge) threatened or contemplated by which the Lender may be bound or to which any property of the Lender is or may be subject, which, if determined adversely to the Lender, would individually or in the aggregate have a material adverse effect on the ability of the Lender to perform its obligations hereunder or on the financial position or results of the operations of the Lender or result in money damages arising out of an alleged error or omissions claim. HNJ ARTICLE III Program Allocation; Transfer of Program Allocation Section 3.01. Initial Prog[am Allocation. (a) General. As of the date hereof; the Lender is authorized to originate Deferred Loans as described in Section hereof in connection with Primary Loans described in _ hereof, in the aggregate principal amount set forth on the cover page hereof for sale to the Issuer pursuant to the Program. Such dollar amount is referred to herein as the Lender's "Program Allocation" . (b) Restriction on Acquisition Loans. No more than 25% of the Program Allocation may be used for Deferred Loans made in connection with Acquisition Loans, and, conversely, not less than 75% of the Program Allocation must be used for Deferred Loans made in connection with Acquisition/Rehabilitation Loans and/or Refinancing/Rehabilitation Loans. (c) Transfer of Program Allocation. The Lender may transfer part or all of its Program Allocation to another mortgage lender with the consent of the Issuer pursuant to Section below. The Lender's Program Allocation may be revoked pursuant to Section _ below. Section 3.02. Transfer by a Lender of its Pro,gxam Allocation. The Lender may voluntarily transfer all or a part of its Program Allocation to another Lender which has already executed an Agreement with the prior written consent of the Issuer. Any such transfer shall be evidenced by written agreement acceptable to the Issuer. Section 3.03. Revocation or Termination of Program Allocation. (a) The Lender's remaining Program Allocation will terminate automatically at the end of the Origination Period and the Lender has no right to any extension of the Origination Period. (b) The Lenders Program Allocation may also be terminated in the event of a Default under Section 19 ARTICLE IV Origination Period; Commitment to Sell and Purchase Deferred Loans Section 4.01. Origination Period . The Origination Period is the period of time during which the Issuer will purchase Deferred Loans from the Lender upon submission to the Issuer by the Lender of the documents described in Section _hereof, in form and substance satisfactory to the Issuer and upon the other conditions set forth in Section hereof . It is the Lender's responsibility to Close Deferred Loans and submit the required documents, certifications and information to the Issuer to enable the Issuer to process the submission and arrange for purchase of the Deferred Loan on or before the last day of the Origination Period. The Issuer will not be required to waive or accelerate any review or processing period if the Lender fails to Close a Deferred Loan sufficiently in advance of the end of the Origination Period to allow the Issuer to process and review the Deferred Loan within normal time periods. Section. 4.02 . Commitment to Sell and Purchase Deferred Loans . The Lender hereby agrees to sell to the Issuer, or fund with moneys provided by the Issuer, and the Issuer hereby agrees to purchase, or fund, and take delivery of Deferred Loans which comply with the requirements of Section hereof from the Lender at a price equal to one hundred percent (100 %) of the outstanding principal amount thereof. Notwithstanding the foregoing, the Issuer will not purchase from the Lender (i) Deferred Loans in an aggregate principal amount exceeding the Lender's Program Allocation or (ii) Deferred Loans made in connection with Acquisition Loans to the extent that such Deferred Loans exceed 25% of Lender's Program Allocation. The Issuer's obligation to fund Qr purchase Deferred Loans is subject to the following: (a) the Issuer will not be required to purchase any Deferred Loan which does not comply with the requirements of Section _ and which is not made in connection with a Primary Loan which meets the requirements of Section hereof . Section 4.03. Timing of Funding of Deferred Loans. In order to receive funding for a Deferred Loan, the Lender must submit to the Issuer during the Origination Period, at least ten (10) business days in advance of the proposed closing, a Request for Deferred Loan Check, in the form of Exhibit _hereto, or a completed Request for Prior Approval in the form of Exhibit _attached hereto in which the Lender has requested a check to fund the Deferred Loan. The Issuer will cause a check sufficient to fund the Deferred Loan to the Lender by first class mail within such ten (10) Business Days following receipt of such request. Section 4.04. Preliminary Deferred Loan Approval. Recertification (a) Preliminary Ap rpp oval. At the Lender's option, a Request for Prior Approval, including the documents listed therein, may be submitted to the Issuer on behalf of the Issuer for preliminary Program compliance approval prior to a Closing pursuant to procedures established by the Issuer. The Issuer shall notify the 20 Lender whether the loan is approved for funding within five (5) Business Days following receipt of the Request for Prior Approval. A preliminary Program compliance approval shall be effective for Deferred Loans Closed within ninety (90) days after the granting thereof as to existing Homes (excluding Homes financed by Rehabilitation Loans), and one hundred eighty (180) days for new Homes or Homes financed by Acquisition/Rehabilitation Loans or Refinancing/Rehabilitation Loans. If the Lender does not obtain the preliminary Program compliance approval by the Issuer set forth in subparagraph (a) above for a Deferred Loan, then the Lender shall fund the Deferred Loan itself and deliver to the Issuer the Request for Approval together with the Mortgage File in connection with the Deferred Loan for purchase by the Issuer. The Issuer shall purchase complying Deferred Loans submitted to it within ten (10) Business Days following submission. The Lender shall bear all costs of preparing and furnishing the Request for Approval and the Mortgage File to the Issuer. The Request for Approval and the Mortgage File will be reviewed by the Issuer pursuant to procedures established for all Lenders by the Issuer. Upon the Issuer's approval of the Deferred Loan for funding on the Closing Date or for purchase following the Closing Date, the Issuer will (i) deliver an advice of purchase to the Lender signed by the Issuer as evidence of such approval. Any Deferred Loan with respect to which the Request for Approval and the Mortgage File or either of them is deemed to be defective will be returned to the Lender by the Issuer with all instruments submitted in accordance with this Section. To be funded or purchased, such defective Deferred Loan must be resubmitted in accordance with the procedures of this Section. The examination and acceptance of a Request for Approval and Mortgage File by the Issuer hereunder shall not constitute a waiver of any warranty, representation or covenant by the Lender or the Mortgagor with respect to the Deferred Loan to which the Request for Approval pertains. (b) Mortgage File; Warranty: Review. Within thirty (30) days after the Lender has closed the Deferred Loan, or such shorter time as the Issuer shall require (but not less than seven (7) days), the Lender shall deliver to the Issuer all of the documents described in Part 1 of Exhibit_ (the "Mortgage File "). The Lender hereby warrants that all copies will be true and accurate copies of the respective original documents and instruments. The Issuer shall have at least fifteen (15) Business Days to review such documents and instruments and will return to the Lender, for appropriate curative action pursuant to Section any such document or instrument which is defective in any material respect. Upon resubmittdl, said review period shall begin anew. (c) Assignment, Endorsement. In the case of a Deferred Loan which was originated in the name of the Lender and which the Lender has funded and submits to the Issuer for purchase prior to the delivery of the Mortgage File to the Issuer (i) the Lender shall record or file for record an Assignment of Mortgage in all offices necessary to perfect the assignment of the Deferred Mortgage to the Issuer under the laws of the State and shall endorse the Deferred Note to the order of the City of Fridley HRA. The Lender shall also provide to the Issuer or the Issuer such other reports or information regarding the Deferred Loan being sold by such Lender as may be 21 reasonably requested by either of them. The Lender shall give the Mortgagor the notice of assignment required by Minnesota Statutes, Section 47.205 . (d) Originals or Certified Copies Notwithstanding the delivery procedures of this Section the Issuer, in its discretion, may accept Mortgage Files which contain certified copies of the Deferred Mortgage and the Assignment of Note and Mortgage in lieu of the originals of the same and a valid commitment for the issuance of a mortgagee's title insurance policy in lieu of a title insurance policy, and may approve the pertinent Deferred Loan for purchase without such originals or certificate if the Mortgage File is otherwise complete, and the Deferred Loan is qualified in all respects under all the terms and conditions of this Agreement. The original recorded Deferred Mortgage and original recorded Assignment of Note and Mortgage and the title insurance policy must be submitted to the Issuer within fortyfive (45) days from the Purchase Date of the subject Deferred Loan or as soon thereafter as such documents are available from the appropriate land records office or federal agency. The Issuer shall, upon receipt of such originals and certified copies, if applicable, file copies of the same with the related Mortgage File. (e) Funding or Purchase Date, The funding or purchase of Deferred Loans hereunder shall take place on a date arranged between the Issuer and Lender consistent with Section 4.04(x). In the case of a Deferred Loan initially funded by the Lender and submitted to the Issuer for purchase by the Issuer, the Lender shall notify the Mortgagor in writing within ten (10) days of purchase (with a copy to the Issuer) that checks, money orders or other remittances in payment of the Deferred Loan must be paid to the order of the Issuer following purchase of the Deferred Loan. (f) Review. The Issuer shall not be obligated to fund any Deferred Loan unless (i) the Request for Deferred Loan Check has been received by the Issuer at least ten (10) Business Days prior to the Closing Date, and (ii) the Request for Approval is received by the Issuer for review at least five (5) Business Days prior to the funding date. The Issuer shall not be obligated to purchase any Deferred Loan initially funded by the Lender unless such Deferred Loan has been submitted to the Issuer for purchase by the Issuer not later than thirty (30) days following the Closing Date, or such later date as may be approved by the Issuer for good cause. (g) Delivery. The Lender shall deliver the original executed Deferred Mortgage, Deferred Note and Assignment of Mortgage to the Issuer in the following manner: (i) any Deferred Note initially funded by the Lender shall bear an endorsement set forth on the back thereof in a form approved by the Issuer, and be executed by a duly authorized officer of the Lender; (ii) any Deferred Note initially funded by the Issuer shall be made to the order of the Issuer; (iii) the related Deferred Mortgage (together with the Assignment of Mortgage in the case of a Deferred Loan initially funded by the Lender) or a true and correct copy of such executed Deferred Mortgage (and Assignment of Mortgage if applicable), and evidence that the originals 22 thereof have been delivered for recording in the office of the county recorder or registrar of titles of Anoka County. The Lender shall further take any other action as the Issuer may direct to cause the proper filing or recording of the Deferred Mortgage (and Assignment of Mortgage, if applicable) in such other places and in such other manner, form or condition satisfactory to the Issuer as is necessary to perfect. the Issuer's interest in each such Deferred Note and related Deferred Mortgage. The delivery of the Deferred. Note and related Deferred Mortgage (and Assignment of Mortgage, if applicable) shall be accompanied with evidence of payment of all applicable documentary stamp and other excise taxes, all intangible taxes and all recording fees . (h) Recertification. Upon request of the Issuer, the Lender shall submit to the Issuer the Request for Prior Approval and Mortgagor's Certifications in an updated form (if deemed necessary by the Issuer) in connection with the purchase of a Deferred Note initially funded by the Lender. (i) Supplemental Checklist or Certification. The Issuer may at its option require, as a condition of preliminary approval and funding or purchase in addition to the certifications and documents called for herein, submission of properly completed supplemental checklists or certifications for the purpose of documenting the Lender's compliance with the terms and conditions hereof. Section 4.05. Maintenance of Mortgage Files. (a) The services shall, at its own expense, maintain the Mortgage File. During the term that the Deferred Loan is outstanding, the services shall retain, with respect to such Deferred Loan, all affidavits, certifications and similar representations executed by the Mortgagor or others in connection with the Deferred Loan, with attachments. In addition, each Mortgage File shall be maintained by the services for a minimum of three (3) years from the date the Deferred Loan is fully paid or otherwise terminated. The Mortgage Files shall be kept at the servicer's regular place of business or at its principal place of business and shall be available for inspection by the Issuer during the servicer's regular business hours. (b) Lender . The Lender shall maintain all Deferred Loan application materials, documents and memoranda for three (3) years after the Closing Date, unless a longer period is required by law. Section 4.06. Defective Documents and Non -Quali niz Loans Repurchase of Deferred Loans by Lender. If any document or documents constituting a part of the original Mortgage File is or are defective in any material respect, or if it is determined that a Deferred Loan is a Non - Qualifying Loan (as defined below), the Issuer, whichever shall have knowledge thereof; shall immediately notify the Lender. Such notice shall specify the defect or defects in question. The Lender shall cure the defect within a period of thirty (30) days from the earlier of the time the Lender discovers such defect or the Lender receives notice of such defect from the Issuer (the "Cure Period ") . "Defect" or "Defective" for purposes of this Section _ shall mean a defect in the Primary Loan, Deferred Loan or Mortgage File which causes the Deferred Loan to be a Non - Qualifying Loan. 23 The Lender hereby covenants and agrees that, if any Defect cannot be cured within the Cure Period, the Lender will, not later than thirty (30) days after expiration of the Cure Period, repurchase (in immediately available funds) the related Deferred Loan from the Issuer at a price equal to one hundred percent (100 %) of the principal remaining unpaid on such Deferred Loan, plus accrued but unpaid interest on the Deferred Loan to the date of the repurchase. The purchase price for the repurchased Deferred Loan shall be delivered by the Lender to the Issuer, whereupon the Issuer shall release the related Deferred Note and Deferred Mortgage to the Lender and reassign the Deferred Mortgage to the Lender. The amount paid to repurchase the Deferred Loan shall be treated by the Issuer as a prepayment of the Deferred Loan. The Lender hereby covenants and agrees that if any Deferred Loan is determined by Issuer to be a Non - Qualifying Loan and the defect causing the Deferred Loan to be Non - Qualified cannot be cured, the Lender will repurchase such Deferred Loan. If the Issuer determines that the defect in the Deferred Loan is attributable to the fault of the Mortgagor or a misrepresentation of the Mortgagor or Seller, the Issuer may at its option direct the Lender to cooperate in enforcement or foreclosure of the Deferred Loan, in lieu of repurchase; provided that it is not possible for the Issuer to foreclose such Deferred Loan, the Lender shall be required to repurchase such Deferred Loan on the terms and conditions set forth in the preceding paragraph. As used herein, the term "Non- Qualifying Loan" shall mean and include any Deferred Loan purchased hereunder with respect to which: (a) Mortgagors fail to occupy the related Home as a principal residence within sixty (60) days after execution of the related Deferred Mortgage, or Section_ is not otherwise met as of the Closing Date. (b) The related residence is not a Home, as defined in Section (c) The Purchase Price of the Home exceeded the Maximum Purchase Price. (d) The related Primary Loan did not meet the requirements of Section hereof on the Closing Date. (e) The current Annual Family Income of the Mortgagor(s) exceeded the applicable Income Limit on the Closing Date. (i) The Deferred Loan fails to comply with any of the applicable provisions of Article V. (g) Any statements contained in any of the affidavits, certifications or representations of the Mortgagor or Lender are determined to be incorrect, untrue, misleading or fraudulent as of the Closing Date. 24 (h) The Deferred Loan otherwise fails to comply with all the terms and conditions of this Agreement, including but not limited to a breach of one or more of the warranties, representations and covenants of the Lender contained in Section Section 4.07. Monthly Status Report. By the fifth (5th) day of each month until the Lender has Closed Deferred Loans equal to its Program Allocation, the Lender must provide to the Issuer a status report prepared by the Lender, in the form approved by the Issuer, setting forth the required information as of the last business day of the preceding month. In the event the Lender fails to file the report required under this Section the Issuer may refuse to purchase any Deferred Loans from the Lender unless and until such failure is cured. 25 ARTICLE V Deferred Loan and Primary Loan Requirements Section 5.01. General. The Issuer is able to provide below -market interest rate funds for the purchase of Deferred Loans through the issuance of the Bonds issued pursuant to the Act. The Act contains certain requirements with respect to the Deferred Loans. These requirements are set forth in this Agreement. It is the responsibility of the Lender to assure that each of the requirements listed in this Article V are met with respect to the Deferred Loans and the Primary Loans. Each Deferred Loan is to be made in connection with, and are to be subordinate to, a specific Primary Loan which is either an Acquisition Loan, Acquisition/Rehabilitation Loan or Refinancing/Rehabilitation Loan. Section 5.02. Deferred Loan Terms. (a) General. Each Deferred Loan shall be made to a Mortgagor to finance certain costs of acquiring, rehabilitating or refinancing a Home as provided in this Article V. Each Deferred Loan will be subject to final review by the Issuer hereunder prior to purchase. (b) Specific Terms. Each Deferred Loan shall be for a Home located in the City and: (i) shall bear simple interest at the rate of 1% per annum; (ii) will provide for the entire principal amount to be payable at maturity or upon prior prepayment at the option of the Mortgagor, and will provide for the entire principal amount to become immediately due and payable upon sale of the financed Home or if the Home ceases to be the principal residence of the Mortgagor, and will provide that the payment of interest shall be deferred and payable in full only upon the payment of the principal amount of the deferred loan; (iii) will mature on the final maturity date of the related Primary Loan; (iv) will not be assumable; 26 (vi) will be made in connection with a Primary Loan which complies in all respects with the requirements of Section hereof, (vi) shall be in a principal amount not exceeding (A) two percent (3 %) (maximum $3,600) of the principal amount of the Primary Loan, in the case of Acquisition Loans; and (B) five percent (5 %) (maximum $6,000) of the principal amount of the Primary Loan, in the case of Acquisition/Rehabilitation or Refinancing/Rehabilitation Loans; and (vii) shall be evidenced by a Deferred Note in the form of Exhibitor Exhibit hereto and shall be secured by a Deferred Mortgage in the form of Exhibit or _ hereto. (c) Title Policy. Each Deferred Loan shall be the subject of a mortgagee's title insurance policy or a valid commitment for the issuance of a mortgagee's title insurance policy insuring the lien of the Deferred Mortgage on the Home, subject only to the Primary Loan and matters which are Permitted Encumbrances with respect to the Primary Loan. (d) Use of proceeds. Proceeds of the Deferred Loan shall be applied, at the option of the Mortgagor, to pay closing costs of, or a portion of the down payment for, the Primary Loan, or to pay a portion of the cost of acquiring, rehabilitating or refinancing the Home, thereby reducing the principal amount of the Primary Loan. (e) Condominiums, Townhouses and PI s There is no restriction on the number or percentage of planned unit development, condominium or townhouse Homes which may be financed by Deferred Loans and Primary Loans under the Program. (f) Manufactured Homes. With respect to manufactured Homes, each such Home must be permanently affixed to the real estate and must meet applicable FNMA standards . Section 5.03. Primary Loan Terms. Each Primary Loan shall be made to a Mortgagor who meets the requirements of Section , to finance a Home as provided in this Article V. Each Primary Loan must comply with the FNMA Guide, subject only to Permitted Encumbrances, be made in accordance with the Lender's then - current underwriting policies, and meet the then - current criteria set forth in the FNMA Guide. Each Primary Loan shall be either an Acquisition Loan, Acquisition/Rehabilitation Loan or Refinancing/Rehabilitation Loan. (b) Specific Terms. Each Primary Loan: (i) shall bear interest at the Lender's then current interest rate for such loans; (ii) will mature not more than thirty (30) years from the date of Closing; (i/ i) will not be assumable; and ()v) will comply in all respects to the FNMA Guide and FNMA rules and reugulations. 27 (c) FNMA Eligible. Each Primary Loan shall be eligible for purchase under the FNMA Guide. Section 5.04. Mortgagors - Income Requirements . (a) Annual Family Income . The Annual Family Income of a Mortgagor must be calculated including the income of both the Mortgagor and any other person who is expected to live in the Home being financed. Annual Family Income will be calculated in accordance with Exhibit hereof, but is, in general, the gross monthly income of the Mortgagor multiplied by 12. Gross monthly income is the sum of monthly gross pay, any additional income from overtime, part-time employment, bonuses, dividends, interest, royalties, pensions, VA compensation, net rental income, etc.; and other income (such as alimony, child support, public assistance, sick pay, social security benefits, unemployment compensation, income received from trusts, and net income received from business activities or investments) . Information with respect to gross monthly income may be obtained from available loan documents executed during the 4 -month period ending on the date of the closing of the Deferred Loan and the Primary Loan, provided that any gross monthly income not included on the loan documents must be included by the Lender in determining gross monthly income for the purposes of compliance with the income limitations provided for in this Agreement. Thus, for example, if the Mortgagor does not include alimony on the loan documents, the Lender in determining gross monthly income must determine the amount of alimony and add that amount to the amount shown on the loan documents. Net rental income is gross rental income less expenses (including depreciation if calculated on a straight -line basis, but not including expenditures for business expansion or amortization of capital indebtedness) calculated either (i) on the basis of actual gross rental income and expenses for the previous year it in fact, the property has been in operation, or (ii) on the basis of projected gross rental income, assuming that net rental income will be twenty -five percent (25 %) of such projected gross rental income in the event there is no operating history for the rental property. Net rental income projected for the additional unit or units in a two unit Home must be taken into account for purposes of calculating income under this section. (b) Income Limits. (i) General. Each Primary Loan and Deferred Loan must be made to a Mortgagor whose Annual Family Income is not greater than $55,000, calculated by deducting from Annual Income $750 for each adult in the family up to two and $500 for each dependent. Section 5.05. N_ o First -Time Homebuyer Requirement. Mortgagors need not be first -time homebuyers. Section 5.06. Maximum Mortgage Amount. (a) The Maximum Mortgage Amount of a Home is $120,000. (a) Maximum Mortgage Price Revisions. The Issuer shall deliver to the Lender a Supplemental Notice from time to time when new Maximum Mortgage Prices are established by the Issuer. W Section 5.07. Eligible Homes- Two -Unit Homes- Personal Property. A Home shall be eligible for financing through a Deferred Loan if such Home meets the criteria and limitations of this Section. (a) Eligible Homes. A Home shall be eligible for financing through a Primary Loan and Deferred Loan if it is a single - family or two - family private detached or attached owner- occupied house, rowhouse, townhouse, or condominium unit containing complete living facilities and facilities functionally related and subordinate thereto and land appurtenant thereto, which is located within the City, (i) which is designed and intended primarily for residential housing (not more than fifteen percent (15 %) of the total area of which is used in a trade or business, including child care services on a regular basis for compensation) for one family or two families, (ii) one -unit of which will be occupied by the owner as his or her principal residence within a reasonable time (within 60 days) after Closing of the Deferred Loan, (iii) the Purchase Price of which does not exceed the Maximum Purchase Price, and (iv) which appurtenant land reasonably maintains the basic livability of the residence and does not provide, other than incidentally, a source of income to the Mortgagor (provided, however, that rental of the non - owner - occupied units in a two -unit Home shall not be deemed to be using a Home other than for a residential purpose) . Mobile homes, rental houses or vacation homes and factory-made housing where such factory-made housing is not permanently affixed to real property and not deemed real property under the laws of the State may not be financed under the Program . (b) Personal Property. Personal property, such as appliances, furniture, etc. which under State law does not constitute a fixture, may not be financed with proceeds of the Primary Loan or Deferred Loan. Section 5.08. No Discrimination . The Lender may not: (a) agree with any person to allocate or reserve any portion of its Program Allocation for Homes to be sold by such person, or (b) enter into or agree to a forward commitment of all or any portion of its Program Allocation other than to individual prospective Mortgagors. The Lender must consider all applications for Deferred Loans in the order in which they are received, or in any other manner designated by the Issuer on a fair and equal basis, may not arbitrarily reject a Deferred Loan application because of the location within the City and I or age of the property, and may not, in the case of a proposed Mortgagor, arbitrarily vary the terms of a loan or the application procedures therefor or reject a Deferred Loan applicant in violation of the Federal Equal Credit Opportunity Act or of State laws against discrimination or in violation of any State or local law. No Lender shall enter into any agreement or arrangement with any person, firm or corporation to prefer any applicant or group of applicants for such loans without the express written approval of the Issuer. In accepting, evaluating and acting upon applications, the Lender shall comply, if applicable, with the Federal Equal Credit Opportunity Act and Regulation B promulgated thereunder, A State laws against discrimination and the regulations thereunder and the Real Estate Settlement Procedures Act of 1974. 29 Section 5.09. New Mortgages. (a) General. Except as provided in subsection (b) below and except in connection with a Refinancing/Rehabilitation Loan, no part of a Deferred Loan or a related Primary Loan may be used to acquire or replace an existing mortgage. (b) Exceptions . Notwithstanding clause (a) of this Section_ , the replacement of construction period loans, bridge loans or interim financing (with a term not longer than twenty -four (24) months or less) will not be treated as the acquisition or replacement of an existing mortgage. Clause (a) above does not apply to a Refinancing/Rehabilitation Loan. Section 5.10. Refinancing/Rehabilitation Loans. (a) Rehabilitation. Primary Loans may be made as Refinancing/Rehabilitation Loans, and the proceeds thereof may be used to acquire or discharge any lien or interest in the Home, only if each of the following additional requirements is satisfied: (i) The Mortgagor to whom the Refinancing/Rehabilitation Loan is made will be the first resident of the Home after completion of the Rehabilitation; (i) The total expenditure for the Rehabilitation equals ten percent (10 %) or more of the Mortgagor's "adjusted basis" in the Home determined at the time of completion of the Home. (V) Either (a) the Rehabilitation has been completed on the date the Deferred Loan is closed, or (b) there is compliance with the provisions of subsection (d) of this Section (b) Policy of Title Insurance. The mortgagee's policy of title insurance for a Refinancing/ Rehabilitation Loan shall be endorsed to delete the standard exception for mechanics' or materialmens' liens arising prior to the date of the Primary Loan. (c) Escrow for Completion. If the Rehabilitation work has not been completed, the Mortgagor shall establish an escrow fund with an institution pursuant to the requirements of the FNMA Guide, and subject to escrow instructions acceptable to the Lender, which escrow must be funded in an amount adequate to pay for any remaining work. (d) ExMtions to Other Requirements. Refinancing/Rehabilitation Loans are not subject to the new mortgage requirement, set forth in Section Section 5.11. Acquisition/Rehabilitation Loans. The Lender may originate Primary Loans and Deferred Loans which finance the acquisition and Rehabilitation of a Home, subject to the following conditions and limitation: (a) Existing Indebtedness. The proceeds of an Acquisition/Rehabilitation Loan may not be applied to refinance or pay any indebtedness secured by the home as to which the Mortgagor is the obligor except a construction, bridge or interim loan as permitted by Section hereof. 30 (b) Capital Costs. Costs of Rehabilitation financed with proceeds of an Acquisition/Rehabilitation Loan under this Section 5.10 must be capital costs. In general capital costs are costs for permanent improvements or betterments which appreciably prolong the life or enhance the value of the Home, for example, replacement of a furnace, roof, kitchen cupboards, bathroom fixtures or floor surfaces (new tile or wall to wall carpeting). Maintenance expenses generally are not capital costs, for example, painting or wallpapering (unless the painting or wallpapering is done in connection with the replacement or addition of a wall). Section 5.12. Origination Fees and Closing Costs. Disbursement of Deferred Loans. (a) The Lender may not charge origination fees or closing costs with respect to Primary Loans which exceed such fees and costs normally charged by the Lender in connection with comparable loans. (b) It is expected that a title company will disburse proceeds of Deferred Loans on the date the Deferred Note is executed or as soon thereafter as is customary. 31 ARTICLE VI Lender's Obligation to Verify Mortgage Requirements; Lender's Representations as to Loans Section 6.01. Independent Verifications by Lender. The Lender must undertake reasonable investigations to determine with respect to each Deferred Loan that: (a) Principal Residence: Occupancy. The Mortgagor must occupy the related Home within sixty (60) days of the date the Deferred Note is executed and must thereafter intend to maintain the property as his or her principal residence. A residence used as an investment or rental property (except as to the second unit of a multi -unit Home) or a recreational home does not satisfy the requirements of a principal residence. The Lender must require the Mortgagor to execute the Mortgagor's Affidavit and Certification (attached hereto as Exhibit ) together with the Mortgagor's Certification as to Income and Residency (attached hereto as Exhibit __j . Such Mortgagor's Affidavit and Certification will normally satisfy the reasonable investigation requirement. The Mortgagor's Affidavit and Certification, the Primary Mortgage and the Deferred Mortgage shall provide that if the Mortgagor ceases to use the Home as his or her primary residence, the Primary Loan and the Deferred Loan may be accelerated and the Primary Mortgage and the Deferred Mortgage shall be foreclosed. Notwithstanding the foregoing, in lieu of accelerating the Primary Loan and the Deferred Loan in the event the Mortgagor fails to occupy the Home as his or her principal residence, the Mortgagor may preps— the Deferred Loan or the Lender may repurchase the related Deferred Loan from the Issuer. (b) New Mortgage. No part of the Primary Loan or Deferred Loan proceeds (other than the proceeds of a Refinancing/Rehabilitation Loan) may be used to acquire or replace an existing mortgage or other owner financing for which the Mortgagor is the obligor or an obligor. The Lender may satisfy its reasonable investigation obligation by reviewing the closing statement. The Mortgagor may have had a construction period loan, bridge loan or similar temporary initial financing with a term of twenty -four (24) months or less with respect to the Home and may use the proceeds of the Primary Note and Deferred Note to repay such financing. In the case of a Refinancing/Rehabilitation Loan, existing indebtedness secured by an interest in the Home may be paid and discharged from- the proceeds of such loan and the related Deferred Loan, but only to the extent of the outstanding principal balance of such indebtedness, plus accrued interest thereon, if any, for a period not exceeding two (2) months. A contract for deed for the Home requiring a final payment within twenty -four months from its execution constitutes temporary initial financing. The Lender must obtain an affidavit of the Mortgagor (included in the Mortgagor's Affidavit and Certification which is attached as Exhibit _) showing compliance with this requirement. (c) Income. The current Annual Family Income of the Mortgagor(s) may not exceed the Maximum Household Income Limit determined pursuant to Section . The Mortgagor's Certification as to Income and Residency must have been executed no more than four (4) months 32 prior to the Closing Date. The Lender shall review such Mortgagor's Certification, employment verifications and any relevant documents in the Mortgage File for the purpose of verifying the Annual Family Income of the Mortgagor. (d) Seller and Mortgagor Survey Forms. For each Deferred Loan, the Lender shall obtain from the seller of the Home a completed Seller Survey, in the form of Exhibit _hereto (or such other form as the Issuer may from time to time prescribe), and shall similarly obtain from the Mortgagor a completed Mortgagor Survey, in the form of Exhibit J hereto (or such other form as the Issuer shall from time to time prescribe). The completed Seller Survey and Mortgagor Survey shall be sent to Issuer within ten (10) days after closing of the Deferred Loan. (e) Lender Determinations. Prior to Purchase of the Deferred Loan by the MCDA, the Lender shall determine whether the Home (i) constitutes a completed residential unit, (ii) includes real property in excess of allowable limits, (iii) shows evidence of use or design for use in a trade or business of the Mortgagor, and (iv) is or is to be occupied by the Mortgagor as the Mortgagor's principal residence. The Lender shall make any examinations or investigations deemed necessary or advisable by the Issuer or reasonably required by the Issuer to determine that all of the requirements for the origination of Deferred Loans and Primary Loans, as set forth in this Agreement, have been met. The obligations of the Lender pursuant to this Section 6.01 shall inure to the benefit of the Issuer. Section 6.02. Representations, Warranties and Covenants of Lender Concerning Loans. The Lender hereby represents and warrants to, and covenants with, the Issuer: (a) Request for Prior Approval, All Applicable Requirements. The information set forth in each Request for Prior Approval will be true and correct. Each Primary Loan and Deferred Loan has been Closed after the commencement date of the Origination Period. Each Primary Loan and Deferred Loan satisfies all applicable requirements set forth in this Agreement. (b) Residence: Standards: Purposes: etc. Each Primary Loan will be secured by a Primary Mortgage which shall constitute a first or second mortgage lien on a Home (as defined herein) occupied by the Mortgagor as such Mortgagor's permanent place of residence and located within the boundaries of the City, will be made substantially in accordance with the Lender's then - current standard underwriting policies, the underwriting standards set forth in the FNMA Guide, and the requirements established hereby, will be made for the purpose acquiring, acquiring and rehabilitating or refinancing and rehabilitating for suchresidence and not for the purpose of refinancing any existing loan (other than as permitted by Section 5.08), will have n a term not longer than thirty (30) years, will be made to a qualified Mortgagor, and will not be assumable. (c) FNMA Program. All Primary Loans shall conform to the requirements of the FNMA Guide. 33 (d) Lien: Encumbrances. As of the Purchase Date, each Deferred Loan will be secured by a Deferred Mortgage, which will constitute a valid lien on the property financed by the Deferred Loan. (e) Waivers and Alterations. The terms, covenants and conditions of the Deferred Loan shall not have been (and shall not, prior to the Purchase Date), be waived, altered, impaired or modified in any respect which would materially affect the value, validity, enforceability or prompt payment of the Deferred Loan, or the enforceability of the lien securing the Deferred Loan, except for such waivers, alterations and the like accomplished by the Lender prior to the Purchase Date and disclosed in writing to and acceptable to the Issuer. (f) Filing and Recordation. Each Deferred Mortgage and the Assignment of Mortgage to the Issuer shall be filed and recorded in the public land records of Hennepin County. (g) Liens. As of the Purchase Date, as to each Deferred Mortgage, there shall be no mechanics', laborers', or materialman's liens or claims therefor outstanding for work, labor, or materials affecting the property encumbered by the Deferred Mortgage securing the Deferred Mortgage that are or might be or become liens prior to, or equal with, the lien of the Deferred Mortgage, unless title insurance with respect to the Home insures against such risk. (h) Good Repair. To the best knowledge of the Lender, physicsl property financed or improved by the Deferred Loan shall be free of material damage and shall be in general good repair on the Purchase Date except to the extent any physical deficiencies. will be corrected by work to be financed from the proceeds of an Acquisition/Rehabilitation Loan or Refinancing/Rehabilitation Loan. (i) Disclosures. Each Deferred Loan, at the time of Closing, shall have conformed to all disclosures required to be made by the Real Estate Settlement Procedures Act and the Federal Truth -in- Lending Act, the Federal Equal Credit Opportunity Act, State laws against discrimination and all other applicable state and federal laws and regulations, and notice of assignment shall have been given. 0) Usury. Each Deferred Loan, at the time of Closing, shall have complied with applicable State and federal usury laws. (k) No Conve, a� nce. To the best knowledge of the Lender, the Mortgagor shall not have conveyed such Mortgagor's right, title to or interest in the property to any party. (1) Credit. As of the Purchase Date, the Lender has no knowledge of any acts or circumstances, economic or otherwise, which may have an adverse effect on the credit of any Mortgagor, the prospect of prompt payment of any Primary Loan or Deferred Loan or the value of any security therefor other than as described in the Primary Loan application. (m) Capacity to Repay. The Lender has reviewed applicable credit reports and related documents required in connection with any application by the potential Mortgagor to assure itself; prior 34 approving such application, that such potential Mortgagor has the capacity to repay the Primary Loan and Deferred Loan. 35 (n) Prudent. As of the Purchase Date, the Lender has no knowledge of any circumstances or condition with respect to the Mortgagor, Home, Primary Loan or Deferred Loan or any related document that could reasonably be expected to cause the Deferred Loan to become delinquent or to adversely affect the value of the Deferred Loan. (o) Others' Representations. As of the Purchase Date, the Lender has no knowledge or other reason to believe that any of the representations and statements contained in the affidavits of the Mortgagor and Lender are not true and correct. (p) Pro ems, Use. The Deferred Loan and Home are in compliance with all governmental statutes, regulations and rules relating to the use of the property including, but not limited to, building and zoning codes, environmental laws and platting requirements. (q) Reservations. The Deferred Loan, at the time Committed and at the time Purchased, did not and does not cause the Lender to violate any reservations of its Program Allocation, including without limitation reservations as set forth in Section _ (b) and reservations for particular types of Primary Loans as set forth in Section (r) Lender Representation. As of the Purchase Date, the representations, warranties and covenants of the Lender set forth in Section remain true and are in full force and effect. (s) Building Code. The Lender shall have received for each newly constructed Home securing a Deferred Loan a certificate of a local building inspector that the Home complies with the requirements of the state building code, set forth under Minnesota Statutes, Sections 16.83 et seq., as then in effect. (t) Municipal Utilities. Each Home securing a Primary Loan and Deferred Loan is serviced by municipal water and sewer utilities. (u) Annexation Area. The Home is not located in any previously unincorporated real property annexed by the City since September 1, 1992. (v) Conformance to Agreement . The Primary Loan and Deferred Loan conform in all other respects to this Agreement. (w) No Funds Advanced. As of the Purchase Date of the Deferred Loan, the Lender has not advanced any funds to or on behalf of the Mortgagor except as financed by the Primary Loan or Deferred Loan. 36 It is understood and agreed that the representations, warranties and covenants set forth in this Section shall survive the sale of the Deferred Loans by the Lender to the Issuer and that the representations, warranties and covenants shall inure to the benefit of the transferees and assigns of the Issuer, which, under the Resolution, include the Bondholders. Upon discovery by the Lender of a breach of any of the foregoing representations, warranties and covenants which materially and adversely affects the value of any Deferred Loan or the interest of the Issuer in any Deferred Loan, the party discovering such breach shall give prompt written notice to the other. A breach of these representations, warranties and covenants shall give rise to the rights and obligations with respect to cure, replacement or repurchase set forth in Section 37 ARTICLE VII Servicing of Deferred Loans Section 7.01. Issuer to Service Deferred Loans. Section 7.02. No Assumptions. The Primary Loans and the Deferred Loans shall not be assumable. ARTICLE VIII Lender Section 8.01. Liability of Lender. The Lender shall be liable hereunder only to the extent that obligations are explicitly imposed upon and undertaken by the Lender. For failure to originate the amount of Deferred Loans in its Program Allocation, the Lender will be required to forfeit its Commitment Fee as liquidated damages and not as a penalty, and shall be liable for no further damages as a result of its failure to originate. Section 8.02. Merger or Consolidation of Lender. Any entity into which the Lender may be merged or consolidated, or any entity resulting from any merger, conversion or consolidation to which the Lender shall be a party, or any entity succeeding to the business of the Lender shall be the successor of the Lender hereunder, without the execution or filing of any document or instrument, except as provided in Section , or any further act on the part of any of the parties hereto . Section 8.03. Limitation on Liability of Directors, Officers. Employees and Agents of Lender. No commissioner, director, officer, employee or agent of the Lender shall be under any personal liability to the Issuer for any action taken (or for refraining from the taking of any action) in good faith pursuant hereto, or for errors in judgment. Section 8.04. Lender Not to Resign. The Lender shall not resign from the obligations and duties hereby imposed on it except upon determination that its duties hereunder are no longer permissible under applicable law or regulation. Any such determination permitting the resignation of the Lender shall be evidenced by an opinion of counsel satisfactory to the Issuer to such effect delivered to the Issuer. No such resignation shall become effective until another Lender shall have assumed the Lender's responsibilities and obligations hereunder. Section 8.05. Access to Certain Documentation and Certain Information Regarding the Deferred Loans. The Lender shall provide to the Issuer and their respective examiners access to the documentation ( which may be on microfilm) regarding the Deferred Loans requested by them, such access being afforded without charge and during normal business hours at the offices of the Lender designated by it. Section 8.06. Notifications. The Lender shall deliver to the Issuer copies of all reports, correspondence, statements, notices or other written communications of the Lender delivered to the Issuer pursuant to this Agreement at the time so delivered. The Issuer shall be entitled to rely upon such written communications of the Lender. A party may waive in writing receipt of any of the foregoing from time to time by notice given to the delivering party. The Issuer shall each provide the others with information, records or such assistance reasonably requested by the others and otherwise cooperate with the others as reasonably requested. 39 ARTICLE IX Termination, Defaults and Remedies Section 9.01. Cause of Termination Defined; Remedies. Upon the happening of any one or more of the following events the Issuer may terminate this Agreement with respect to the Lender and reallocate its unused Program Allocation (without compensation therefor) to other Lenders under the Program, or take whatever action at law or in equity as may appear necessary or desirable to enforce performance or observance of any obligation, agreement, or covenant of the Lender hereunder: (a) Failure by the Lender duly to observe or perform in any material respect any covenant, conditions or agreement required by this Agreement to be observed performed, for a period of thirty (30) days after written notice, specifying such failure and requesting that it be remedied, given to the Lender by the Issuer, unless the Issuer shall agree in writing to an extension of such time prior to its expiration; provided, however, if the failure stated in the notice cannot be corrected within the applicable period, the Issuer will not unreasonably withhold its consent to an extension of such time if corrective action is instituted by the Lender within the applicable period and diligently pursued until the default is corrected; (b) The Issuer has required the repurchase of a Deferred Loan as a result of a failure of the Lender to abide by the provisions of this Agreement, and the Lender has not timely repurchased said Deferred Loan upon proper notice hereunder; (c) A decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator or receiver or liquidator in any insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings, or for the winding up or liquidation of its affairs, shall have been entered against the Lender and such decree or order shall have remained in force undischarged or unstayed for a period of sixty (60) days; (d) The Lender shall consent to or have imposed on itself the appointment of a conservator or receiver or liquidation in any insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings of or relating to the Lender or of or relating to all or substantially all of its property; (e) The Lender shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable insolvency or reorganization statute, make an assignment for the benefit of its creditors, or voluntarily suspend payment of its obligations; (f) Merger, consolidation or sale of substantially all of the Lender's assets, or assignment of the Lender's rights and obligations under this Agreement without any prior written consent required pursuant to Sections and 40 (g) The Issuer shall discover or be notified that any representation of or warranty by the Lender to the Issuer is false in any material respect; or (h) There occurs prior to the Purchase of any Deferred Loan a change in status of the Lender originating such Deferred Loan with respect to the Lender's approval as either an FNMA approved mortgagee. Section 9.02. Appointment of Successor. At the time the Lender receives a notice of termination, the Issuer shall succeed to all rights and obligations of the Lender. As compensation therefor, the Issuer shall be paid such compensation available to the replaced Lender ; provided, however, such fee shall only be payable from funds which the Lender would have been entitled to receive if the Lender had continued to act hereunder. Section 9.03. No Remedy Exclusive. Unless otherwise expressly provided, no remedy herein conferred or reserved is intended to be exclusive of any other available remedy, but each remedy shall be cumulative and shall be in addition to other remedies given hereunder or existing at law or in equity. No delay or omission to exercise any right or power accruing hereunder upon the happening of any event set forth in Sections or shall impair any such right or power or shall be construed to be a waiver thereof, but any such right or power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the Issuer to exercise any remedy reserved to it in this Article, it shall not be necessary to give any notice, other than such notice as may be required in this Article. Section 9.04. Agreement to Pay Attorney s' Fees and Expenses. In the event the Lender should fail to perform its obligations under any of the provisions hereof and the Issuer should employ attorneys or incur other expenses for the enforcement of performance or observance of any obligation or agreement on the part of the Lender herein contained, the Lender agrees that to the extent permitted by law it will pay or reimburse the Issuer or MCDA on demand, the reasonable fees of attorneys and such other incurred expenses. Section 9.05. Liability of Issuer. The Issuer shall not be liable for the appointment or removal of a successor Lender or owe any duty with respect to such appointment or removal, except for its own willful misconduct and except to the extent of its obligations to assure proper servicing hereunder. Section 9.06. Survival upon Termination . The remedy of termination provided for in this Section shall not be the exclusive remedy for the origination or delivery for purchase of a Non - Qualifying Loan. The Lender shall remain obligated to repurchase any such Non - Qualifying Loan pursuant to Section notwithstanding any termination of this Agreement. Upon termination, a Lender shall turn over Deferred Loans in process (at no compensation or fee therefor) as directed by the Issuer for reallocation to other Lenders to complete. 41 ARTICLE X Miscellaneous Provisions Section 10.01. Revisions by Supplemental Notice . The Issuer in its discretion upon obtaining an opinion of Bond Counsel may issue one or more Supplemental Notices revising the provisions of this Agreement, including, without limitation, revisions which: change the Income Limit for all Deferred Loans and Primary Loans; or change the Maximum Mortgage Amount for all Homes or for specified types of Homes. The Issuer may not, however, revise this Agreement by the issuance of any Supplemental Notice which: (a) shortens the Origination Period; (b) imposes upon the Lender, without the Lender's consent, substantial additional duties or obligations with respect to the origination of Deferred Loans; (c) substantially restricts the class of eligible mortgagors; (d) limits the fees and charges which the Lender is permitted to charge hereunder, or (e) causes any Deferred Loan originated in accordance with the terms hereof not to be a Qualifying Loan. provided however, that the Issuer may revise this Agreement in the manner specified in clauses (a) through (f), inclusive, or in any other manner, by Supplemental Notice, if such action is required to assure compliance with federal or State law. Any such change shall only apply prospectively to Deferred Loans not delivered for Purchase. Section 10.02 . Other Amendments _ Changes and Modifications . Subsequent to the issuance of the Bonds and prior to their payment in full (or provision for the payment thereof having been made in accordance with the provisions of the Resolution ), this Agreement may be amended , changed , modified , altered or terminated only as provided in the Resolution and with the written consent of the Issuer. Section 10.03. Recordation of Agreement. This Agreement, or a memorandum of any portion or portions hereof executed by the Issuer and Lender, is subject to recordation among the land records of any County in this State, and in any other appropriate public office or elsewhere on direction by the Issuer. Section 10.04. Governing Law. This Agreement shall be construed in accordance with the laws of the State, or, if applicable the laws of the United States, and the obligations, rights and remedies of the parties hereunder shall be determined in accordance with such laws. 43 Section 10.05. Notices. All notices, certificates or other communications hereunder shall be sufficiently given and shall be deemed given when delivered or mailed by certified or registered mail, postage prepaid, return receipt requested, addressed to the appropriate Notice Address. A duplicate copy of each notice, certificate or other communication given hereunder to the Issuer or Lender shall also be given to the others. Any party hereto may, by notice given to the other parties hereunder, designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent. Section 10.06. Severability. In the event any provision hereof shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provisions hereof. Section 10.07. Further Assurances and Corrective Instruments. To the extent permitted by law, the Issuer and Lender agree that they will, from time to time, execute, acknowledge and deliver, or cause to be executed, acknowledged and delivered, such supplements hereto and such further instruments as may reasonably be required for carrying out the intention hereof or facilitating the performance hereof. Section 10.08. Term of Agreement . This Agreement shall be in full force and effect from the date hereof and shall continue in effect so long as any of the Bonds are Outstanding or any Deferred Loan purchased hereunder remains outstanding, whichever is longer, or until such time as terminated pursuant to Article IX. Section 10.09. No Rights Conferred on Others. Nothing herein shall confer any right upon any person other than the Issuer and Lender. Section 10.10. Discretion of Issuer. With respect to any disputes between the Issuer and Lender which arise concerning the terms and provisions hereof; the meaning thereof or decisions to be made thereunder, the judgment of the Issuer shall govern . Section 10.11. Counterparts. This Agreement may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument: Section 10.12 . Forms of Exhibits_ Guidelines . The forms of the documents set forth as Exhibits to this Agreement may be changed (including changes to make more than one version available, each stating only information or requirements pertinent to particular types of Primary Loans or Deferred Loans, or excluding matters relating to specific loans for which such matters are not pertinent) by the Issuer provided that any such change shall not: (a) adversely affect the security for a Deferred Loan; or (b) change the requirements of this Agreement. 44 In addition, the Issuer may from time to time issue guidelines for the application for the various terms and conditions hereof. Section 10. U.—Limitation on Liability of Directors Officers Employees and Agents No director, officer, employee, commissioner or agent of the Issuer shall be under any personal liability to the Lender for any action taken (or for refraining from the taking of any such action) in good faith pursuant hereto, or for errors in judgment. 46 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of July , 1993, by their officers duly appointed and authorized. Lender By Its 47 e EXHIBIT A MORTGAGE FILE PART I 1. The original and one (1) copy of the executed Deferred Note (in the provided form of Exhibit G or G -1 of the Mortgage Origination Agreement) endorsed as provided in the Mortgage Origination Agreement. 2. One (1) certified copy of the original Deferred Mortgage (in the form of Exhibit H or H -1 of the Mortgage Origination Agreement) which has been sent for recording. 3. One (1) certified copy of the Assignment of Mortgage to the Issuer with recording information (together with one (1) certified copy of intervening Assignments of Mortgage, if applicable). 4. A mortgagee's junior policy of title insurance in American Land Title Association approved form in an amount equal to the principal amount of the Deferred Loan. 5• A certified copy of the HUD -1 Settlement Statements, executed by the Mortgagor, Seller and Settlement Agent relating to the Deferred Loan and the Primary Loan. 6e A certified copy of the Primary Note and Primary Mortgage. 7• If not submitted in a prior approval request, the following items should be submitted: (a) copy of the upfront application form; (b) copy of the verification(s) of house- hold income (for self employed borrowers, and a year -to- date profit and loss); (c). a certified copy of the purchase agreement together with all addenda; (d) Seller's Survey Form; and (e) Mortgagor's Survey Form. 8• All documents which are required to be retained by Federal or State laws, statutes or regulations, including copies of any disclosure statements required by such laws. A certified copy of the Good Faith Estimate of Settlement Costs and a certified copy of the Truth -in- Lending Disclosure Statement for the Deferred Loan, 9• Evidence of satisfactory completion of all documentation required by the Request for Approval. 10. Properly completed Mortgagor Affidavit and Certification. 11. Evidence of compliance with any applicable building code requirements. PART II The following shall be delivered to the Issuer within Z(60) days of the Purchase date. Failure to deliver on a timely basis shall cause a Deferred Loan to be a Non - Qualifying Loan as defined in section 4.06 of the Mortgage Origination Agreement. 1. Recorded Deferred Mortgage. 2. Recorded Assignments of Deferred Mortgage, if needed, together with all recorded intervening assignments of Mortgage, if any. 3. Mortgagees junior Policy of Title Insurance and all applicable endorsements and attachments. 4• Any other documents as required by the Issuer. PART III The following shall be delivered to the Issuer within ten (10) calendar days of the completion of the construction work of a loan involving rehabilitation work. together photographs. py of appraisers final inspection report P graphs. 2. Copy of final bids and any change orders regarding the Rehabilitation. 3. Any other documents as required by the Issuer. EXHIBIT B ' REQUEST FOR DEFERRED LOAN CHECK FRIDLEY MIDDLE INCOME HOUSING PROGRAM Date: To: Grant Fernelius City of Fridley 6431 University Ave. NE Fridley, MN 55432 Mortgagor(s): Property Address: Fridley, Minnesota 554 Loan Type: Refinance /Rehab (maximum deferred loan is 5$ of refinancing cost plus qualifying Rehabil- (check one) itation). Acquisition /Rehab (maximum deferred loan is 5% or $6,000 of Acquisition Cost plus qualifying Rehabilitation). Acquisition (maximum deferred loan is 3% or $3,600 of Acquisition Cost). Lender's Mortgage Amount: Acquisition Cost: Refinancing Cost: Qualifying Rehabilitation Cost: Deferred Loan Amount: Title Company: Closing Location: (address) Title Insurance File Number: Closing Date: Mail Check To : (Lender's address) Call contact person to have Lender pick up check Make Check Payable To: or I hereby certify that the Deferred Loan which is the subjct this request meets the requirements of the Mortgage origineation of Agreement. I f any questions should arise, please contact: Signature Lender Contact Person Telephone Number Lender Company Name company Address City, State, Zip Attn: For this purpose, "Rehabilitation" is defined as the improvement of a Home to improve the basic livability of the Home or the improvement of the Home to a decent, safe and sanitary condition, requiring more than routine or minor repairs or improvements. Such work may vary in degree from gutting and extensive reconstruction to cosmetic improvements coupled with cure of a substantial accumulation of deferred maintenance, and may include the construction or rehabilitation of an attached or detached garage and a driveway therefor, room additions, repair of sidewalks, improvement to achieve energy efficiency and other similar expenditures, but not including the improvement of sheds, storage facilities or other buildings or facilities attached to or adjacent to a Home other than a garage (or driveway therefor), and not including swimming pools, decks, patios, saunas, saps or other purely recreational facilities. All rehabilitation work must be done by bonded contractors licensed in Minneapolis. The check will not be released until the Deferred Loan has been approved for funding or purchase by the Issuer as evidenced by the execution on behalf of the Issuer of the approval set forth on Exhibit C of the Origination Agreements. EXHIBIT C REQUEST FOR APPROVAL FRIDLEY MIDDLE INCOME HOUSING PROGRAM Date: To: Grant Fern Prior to Closing City of Fridley 6431 University Ave. NE Approval following Fridley, MN 55432 Closing Date (no prior approval) Lender: Lender's Fax #: Mortgagor(s): Property Address: Fridley, Minnesota 554 Lender's Mortgage Amount: $ Primary Refinance /Rehab Loan Type: (check one) Purchase /Rehab Acquisition The following documents ar hereby submitted for approval of a Deferred Loan under the Mortgage Origination Agreement. Request for deferred loan check (if ordering at the same time.) Copy of Application Copy of Purchase Agreement and Addenda Copy of Income Verification from all sources. (For self employed borrowers, include complete copies of last two years federal tax returns and a year - to -date profit and loss statement.) Copy of Mortgagor's Affidavit and Certification Seller's Survey Form Mortgagors Survey Form I hereby certify that this request meets the requirements of the Mortgage Origination Agreement dated July 1, 1993, between the City of Fridley Housing and Redevelopment Authority referenced below. If any questions should arise, please contact: Signature Company Name Lender Contact Person Company Address Telephone Number City, State, Zip APPROVAL The above- referenced documents have been received by the Issuer and the above- referenced Deferred Loan is hereby approved for: Purchase following Closing r Dated: Providing a check for the funding of the Deferred Loan at Closing CITY OF,FRIDLEY HRA By Loan Officer EXHIBIT D MORTGAGORIS AFFIDAVIT AND CERTIFICATION The undersigned, as a prospective mortgagor of a second mortgage loan (a "Deferred Loan ") made in connection with the City of Fridley Middle Income Housing Program, 1993 (the "Program "), being first duly sworn (or affirmed) under oath, hereby states and certifies that: 1. Home. I have applied for a Deferred Loan under the Program, which loan will be secured by a mortgage which is subordinate to my primary financing ( "Primary Loan ") for the Home, and I will use the proceeds of the Primary Loan for one of the following types of financing for a home (the "Home ") located in the City of Fridley: (a.) Acquisition: to finance the purchase by me of a single family residence or duplex; (b.) Refinancing /Rehabilitation: to refinance my existing financing for the home and rehabilitate the Home, meeting the following requirements: (i) I will be the first resident of the Home after completion of the Rehabilitation; (ii) The total expenditure for the Rehabilitation equals ten percent (101%) or more of my "adjusted basis" (determined for Purpose of federal income taxation) in the Home determined at the time of completion of the Rehabilitation. (c.) Acquisition /Rehabilitation: to finance my pur- chase of the Home and not less than $15,000 of Rehabil- itation of the Home. Costs of Rehabilitation financed with proceeds of an Acquisition /Rehabilitation Loan must be capital costs. In general, capital costs are costs for permanent improvements or betterments which appre- ciably prolong the life cr enhance the value of the Home, for example, replacement of a furnace, roof, kitchen cupboards, bathroom fixtures or floor surfaces (new tile or wall to wall carpeting). Maintenance expenses generally are not capital costs, for example, painting or wallpapering (unless the painting or wallpapering is done in connection with the replacement or addition of a wall). For purposes of loans described in b and c above, "Rehabilitation: means the improvement of a Home to improve the basic livability of the Home or the improvement of the Home to a decent, safe and sanitary condition, requiring more than routine or minor repairs or improvements. Such work may vary in degree from gutting and extensive reconstruction to cosmetic improve- ments coupled with cure of a substantial accumulation of deferred maintenance, and may include the construction or rehabilitation of an attached or detached garage and a driveway therefor, room additions, repair of sidewalks, improvement to achieve energy efficiency and other similar expenditures, but not including the improvement of sheds, storage facilities or/other buildings or facilities attached to or adjacent to a Home other than a garage (or driveway therefor), and not including swimming pools, decks, patios, saunas, spas or other purely recreational facilities. A legal description of the home is attached to this Certificate, or is: �r 2. ,About the Home The Home includes a residential unit for one, or two fami- 1(y)(ies). The Home is a private family dwelling, or a townhouse or condominium dwelling, and (other than the extra unit-in a two - family residence) will be occupied by me alone or by me and my family. The land to be purchased as part of the home is included with and appurtenant to the improvements purchased as part of the Home. Such land reasonably maintains the basic liability of the Home, and the quantity of land is not excessive when compared with lot sizes of residences in the area, and the land does not and will not provide, other than incidentally, a source of income to me. 3. Principal Residence I either presently occupy the Home, in the case of a Refinancing /Rehabilitation, or intend to occupy the Home within no more than sixty (60) days from the date hereof as my primary and permanent residence; I have no present intention to sell, lease, rent, or otherwise dispose of the Home; upon occupancy of the Home, I will not have any other permanent or primary residence; and i am not purchasing the Home primarily for purposes of a trade or business, for investment purposes, or as a recreational home. (A home more than 15% of the total area of which is reasonably expected to be used in trade or business, including child care services on a regular basis for compensation, is used "primarily for purposes of a trade or business ".) I UNDERSTAND THAT THE PRIMARY MORTGAGE AND THE DEFERRED MORTGAGE EXECUTED BY ME IN CONNECTION WITH THE LOAN PROVIDES THAT IF I FAIL TO OCCUPY THE HOME AS MY PRIMARY RESIDENCE, THE LOAN MAY BE ACCELERATED AND SUCH MORTGAGES FORE- CLOSED. 4• New Mortgage Except in the case of a Refinancing /Rehabilitation Loan, no part of the loan proceeds is or will be used to acquire or replace an existing mortgage, and I did not have a mortgage (whether or not paid off) on the Home at any time prior to the execution of the Primary Mortgage or Deferred mortgage (except that I may have a construction period loan, bridge loan or temporary initial financing with a term of twenty -four (24) months or less with respect to the Home and may use the proceeds of the mortgage to repay such financing). S.- Maximum Mortgage The maximum mortgage of the Home, excluding personal property but including fixtures, is $120,000 or less, and reflects all amounts paid or to be paid to the seller in order to acquire the Home. None of the proceeds of the Deferred Loan will be used to purchase personal property such as appliances which are not built in, furniture, a television, a radio or any other item which does not constitute a fixture. The purchase price of the Home is as stated in the purchase.agreement for the Home. The purchase agreement is attached to this Certificate or I have supplied a separate copy of it certified by myself and the Seller as being a true and correct copy, together with any addenda, modifications or amendments attached, of it in its final complete form. I am purchasing from the seller of the Home the following personal property at the following prices, which prices do not exceed the fair market value of such personal property: Personal Propertv Price 6. Acquisition Cost - Rehabilitation (a.) Acquisition /Rehabilitation Loan. If the Primary Loan is a Acquisition /Rehabilitation Loan, the acquisition cost shall include both the cost of acquiring the Home from the Seller and all amounts paid or to be paid for Rehabilitation of the Home, excluding the value of any labor contributed by the Mortgagor or a member of the mortgagor's family. (b.) Refinancing /Rehabilitation Loan. If the Primary Loan is a Refinancing /Rehabilitation Loan, the acquisition cost shall be an amount equal to the Mortgagor's adjusted basis in the Home as of the completion of the Rehabilitation, including actual cost of the Rehabilitation work. 7. Accuisition Cost - Described. I understand that for the purposes of the foregoing the acquisition cost of the Home is the cost of acquiring the Home from the seller as completed residential unit. The acquisition cost includes: (a.) All amounts paid, either in cash or in kind, by the purchaser (or a related party or for the benefit of the purchaser) to the seller (or a related party or for the benefit of the seller) as consideration for the residence. (b.) If a residence is incomplete, the reasonable cost of completing the residence whether or not the cost of completing construction is to be financed with proceeds of the mortgage loan. (c.) Where a residence is purchased subject to a ground rent, the capitalized value of the ground rent shall be included in the Purchase Price. Such value shall be computed using a discount rate determined by the Issuer. (d.) Fixtures, such as wall -to -wall carpeting, light fixtures and curtain rods. The acquisition cost does not include: NO Personal property purchased from the seller, except to the extent the cost of such property exceeds its fair market value. •(x.) The usual and reasonable settlement or financing costs. Settlement costs include titling and transfer costs,. title insurance, survey fees, or other similar costs. Financing of costs include credit reference fees, legal fees, appraisal expenses, "points" which are paid by the purchaser (but not the seller, even though borne by the purchaser through a higher acquisition cost) or other costs of financing the residence. (y.) The value of services performed by any purchasers family in completing the residence. . For purposes of the preceding sentence, the family of an individual includes only the individual's brothers and sisters (whether by whole or half blood), spouse, ancestors, and lineal descendants. (z.) The cost of land which has been owned by any purchaser for at least two (2) years prior to the date on which construction of the residence begins. I have not entered into any .contract or agreement, express or implied, to obtain the performance of additional construction on the Home. 8. No Assumption. I understand that neither the Primary Loan nor the Deferred Loan is assumable. 9. Income, The Annual Family Income of my family is $ I understand that Annual Family Income includes total income from all sources (before taxes and withholding) of all adult persons residing or intending to reside in the Home. Annual Family Income is defined as "the current family income of a potential Mortgagor and shall in any event include the current gross income of all persons who live or intend to live with such Mortgagor in the same dwelling unit (other than persons under i8 years of age who are not primarily liable or secondarily liable on the not), but exclusive or an cc- signer of a Note who does not live or intend to live in the Home, as evidenced by documentation satisfactory to the Lender." 10. Other Owners. All persons obtaining an interest in the Home have executed this Certificate or a similar certificate. 11. No Other Program Loan I have not previously received a Deferred Loan under the Program. 12. CONSEQUENCE OF FALSE STATEMENTS I RECOGNIZE AND UNDERSTAND THAT FALSELY STATING THE INFORMATION CONTAINED IN THIS CERTIFICATE MAY CONSTITUTE A DEFAULT UNDER THE LOAN NOTE, AND THAT IN THE EVENT OF SUCH A DEFAULT OR ANY OTHER DEFAULT UNDER THE DEFERRED LOAN NOTE, THE HOLDER OF THE NOTE MAY EXERCISE ANY REMEDY UNDER THE DEFERRED LOAN NOTE, INCLUDING, BUT NOT LIMITED TO , ACCELERATING THE DEFERRED LOAN, AT WHICH TIME I MUST IMMEDIATELY REPAY THE DEFERRED LOAN: AND THAT ANY SUCH FALSE STATEMENT MAY CONSTITUTE FRAUD PUNISHABLE IN ACCORDANCE WITH THE LAWS OF THE STATE OF MINNESOTA. 13. Program. I understand that the information provided herein and information submitted as part of my loan application will be reviewed by the Minneapolis Community Development Agency and will be available to the City of Fridley, as the Issuer, as part of the Issuer's Fridley Middle Income Housing Program, 1993 (the "Program "). Dated: 1 19_ Purchaser Purchaser Attach legal description of the Home, unless described in text. Attach purchase agreement for the Home, unless certified copy given. STATE OF MINNESOTA ) COUNTY OF I ) SS. Signed and sworn to (or affirmed) before me on 19_, by (Seal, if any) Notary Public My commission expires: Attach legal description here, unless described in text. Attach Purchase Agreement, unless certified copy given. P EXHIBIT E MORTGAGE LENDER'S AFFIDAVIT I, a duly authorized and acting officer of the Lender which will originate the Mortgage Loan, do hereby depose and say, for and on behalf of the Mortgage Lender: 1. I have examined the Mortgagor's Affidavit and Certification and the Seller's Affidavit and Certification. 2. The Lender is not aware of any facts or circumstances that would cause it to question the truth or completeness of any portion of such Affidavits. 3. In the course of processing the documents concerning the mortgagor's residency prior to executing the contract of sale, nothing has come to the Lender's attention which would lead it to believe that any of the information supplied by the Mortgagor or any party is false or misleading. 4. The processing fees and closing costs paid by the Mortgagor are reasonable and customary. 5. Each investigation undertaken by the lender has been thoroughly undertaken and has provided no information which would lead the Mortgage Lender to believe that the results of such investigations are in any way false or misleading. MORTGAGE LENDER By: STATE OF MINNESOTA ) COUNTY OF 1 SS. Signed and sworn to (or affirmed) and acknowledged before me on , as of Notary Public My commission expires: EXHIBIT F CHECK TRANSMITTAL FORM FRIDLEY MIDDLE INCOME HOUSING PROGRAM To: From: Grant Fernelius City of Fridley 6431 University Ave. NE Fridley, MN 55432 Date: RE: Title Insurance File Number: Title Company: Primary Lender: Mortgagor (s) : Subject Property: Fridley, Minnesota 554_ The City of Fridley is providing a Deferred Loan in the amount of $ pursuant to the Mortgage Origination Agreement dated July It 1993; between and among the Lender, City of Fridley in connection with the above loan. A check made out to the Lender or the Title Company for the amount of the Deferred Loan is attached hereto. If this closing does not take place within five (5) days of the date these the chea closing instructions, you are instructed to return ck to Issuer at the following address: Grant Fernelius City of Fridley 6431 University Ave. NE Fridley, MN 55432 If you have any questions, please call at IN d EXHIBIT I SELLER SURVEY FORM The Fridley Middle Income Housing program is designed to make Fridley an attractive place to live for middle income owners and buyers. You can help us measure the success of the program and plan new programs by completing this brief questionnaire. This information is needed for statistical purposes only and will be kept confidential. 1. Street address of property being sold: Fridley, MN 554_ 2. Is property currently: (a) owner occupied (b) rental property (c) refinance /rehab (d) repossessed (e) new construction (f) vacant /in estate (g) other 2a. How may people currently live (or most recently lived) in the home? 3. How may bedrooms are there in the property being sold? 4. At your new home, will you be: (a) owning (b) renting (c) other 4a. Will your new home cost: (a) less than (b) more than (c) equal to the property being sold? 5. Will you be moving to a: (a) detached single family home (b) apartment building, including rental, cooper- ative, condominium, highrise (c) townhouse (d) other 5a. If you are moving to a townhouse or apartment building outside of your neighborhood, would you have preferred staying in your neighborhood if a similar unit had been available? (a) ves (b) no (c) no difference /not sure 6. Where is your new home located? City: State: Zip Code: 7. Why ar you moving: (Check as anv reasons as apply) (a) desire new home (b) desire larger unit (c) desire smaller unit (d) lower taxes (e) health reasons (f) new home easier to maintain (g) _job related reasons (e.g., closer to work and new job) (h) lower energy costs (i) better school opportunities (j) more desirable neighborhood (quieter, more secure, etc.) (k) need equity from current home (1) better services /amenities (recreational facilities, special services, etc.) (m) _refer rental to ownership (n) closer to friends /relatives (o) family related (marriage, divorce, etc.) (P) other (please describe EXHIBIT J FRIDLEY MIDDLE INCOME HOUSING PROGRAM, 1993 MORTGAGOR SURVEY FORM Property Address: City: Zip Code: Purchase Price: $ Mortgagor's Age: Annual Family Income: $ Mortgagor's Previous Residence: ( ) Minneapolis ( ) Saint Paul ( ) Outside of Minneapolis or Saint Paul Zip Code at Previous Residence: Previous Tenure: ( ) Owned prior home ( ) Rented prior home ( ) Other Amount of Prior Rental: $ Family Size: Number of Children: Age of Children: (For Female Headed Households): ( ) Single Family ( ) Females with Children ( ) Other Racial /Ethnic Group: ( ) Caucasian ( ) Hispanic ( ) Black ( ) Asian ( ) American Indian ( ) Not Indicated /Other Application Date: EXHIBIT R LENDER'S MONTHLY STATUS REPORT FRIDLEY MIDDLE INCOME HOUSING PROGRAM Date: To: Grant Fernelius City of Fridley 6431 University Ave. NE Fridley, MN 55432 Number of deferred loans in process $ amount of deferred loans in process Number of deferred loans closed $ amount of deferred loans closed If any questions should arise, please contact: Signature Lender Contact Person Telephone Number company Name Company Address City, State, Zip ft ., EXHIBIT L ASSIGNMENT OF NOTE AND MORTGAGE KNOW ALL PERSONS BY THESE PRESENTS that a corporation duly organized and existing under the laws of , party of the first part, in consideration of the sum of Dollars, in hand paid by the Minneapolis /Saint Paul Housing Finance Board, a joint powers board organized and existing under the laws of , party of the second part, receipt whereof is hereby acknowledged, does hereby sell, assign, transfer, and set over, to said party of the second part, its successors and assigns, that certain second mortgage executed by ' as mortgagor, to as mortgagee, bearing the date of the day of 199_, filed for record in the office of the County Recorder /Registrar of Titles of the County of and State of Minnesota, on the day of , 199_, and recorded in Book , of , page as Document No. , and the Mortgage Note relating thereto. IN TESTIMONY WHEREOF, the said party has caused these presents to be executed in its corporate name by its and its corporate seal to be hereunto affixed this day of , 199_ (SEAL) By Its STATE OF MINNESOTA ) COUNTY OF as This instrument was acknowledged before me on 199 , by as of ( SEAL) Notary Public My Commission Expires This Instrument was drafted by: NOTE , 19 Fridley MN 554 Property Address City State Zip Code 1. BORROWER'S PROMISE TO PAY In return for a loan that I have received, I promise to pay U.S. $ (this amount will be called "principal "), plus interest, to the order of the Lender. The Lender may transfer this Note. The Lender or anyone who takes this Note by transfer and who is entitle to receive payments under this Note will be called the "Note Holder ". 2. INTEREST Twill pay interest at a yearly rate of 1% simple interest. Interest will be charged on that part of principal which has not been paid. Interest will be charge beginning on the date of this Note and continuing until the full amount of principal has been paid. 3. PAYMENTS I will pay principal and interest by making a payment of U.S. $ on (maturity date) If, on , I still owe amounts under this Note, I will pay all those amounts, in full, on that date. I w 1 l l m a k e m y p a y m e n t a t the Note Holder. or at a different place if required by 4. BORROWER'S FAILURE TO PAY AS REQUIRED (A) Late Charge for Overdue Payments If the Note Holder has not received the full amount of any of my payments by the end of 30 calendar days after the date it is due, I will pay a late charge to the Note Holder. The amount of the charge will be 1 of my overdue payment, but not less than U.S. $ and not more than U.S. $ I will pay this late charge only once on any late payment. (B) Notice From Note Holder If I do not pay the full amount of the required payment on time, the Note Holder may send me a written notice telling me that if 2 do no pay the overdue amount by a certain date I will be in default. That date must be at least 30 days after the date on which the notice is mailed to me. (C) Default If I do not pay the overdue amount by the date stated in the notice described in (B) above, I will be in default. If I am in default,'the Note Holder may require me to pay immediately the full amount of principal which has not been paid and all the interest that I owe on that amount. Even if, at a time when I am in default, the Note Holder does not require me to pay immediately in full as described above, the Note Holder will still have the right to do so if I an in default at a later time. (D) Payment of Note Holder's Costs and Expenses If the Note Holder has required me to pay immediately in full as described above, the Note Holder will have the right to be paid back for all of its costs and expenses to the extent not prohibited by applicable law. Those expenses include, for example, reasonable attorneys' fees. 5. THIS NOTE SECURED BY A MORTGAGE in addition to the protections given to the Note Holder under this Note, a Mortgage, dated 19 protects the Note Holder from possible losses which might result if I do not keep the promises which I make in this Note. That Mortgage describes how and under what conditions I may be required to make immediate payment in full of all amounts that I owe under this Note. 6. BORROWER'S PAYMENTS BEFORE THEY ARE DUE I have the right to make payments of principal at any time before they ar due. A payment of principal only is known as a "prepayment ". When I make a prepayment, I will tell the Note Holder in a letter that I am doing so. A prepayment of all of the unpaid principal isknown as a "full prepayment ". A prepayment of only part of the unpaid principal is known as a "partial prepayment ". I may make a full prepayment or a partial prepayment without paying any penalty. The Note Holder will use all of my prepayments to reduce the amount of principal that I owe under this Note. I may make a full or partial prepayment at any time. 7. BORROWER'S WAIVERS I waive my rights to require the Note Holder to do certain things. Those things ar: (A) to demand payment of amounts due (know as "presentment ") ; (B) to give notice that amounts due have not been paid (know as "notice of dishonor "); (C) to obtain an official certification of nonpayment (know as a "protest "). Anyone else who agrees to keep the promises made in this Note, or who agrees to make payments to the Note Holder if I fail to keep my promises under this Note, or who signs this Note to transfer it to someone else also waives these rights. These persons are known as "guarantors, sureties and endorsers ". S. GIVING OF NOTICES Any notice that must be given to me under this Note will be given by delivering it or by ;mailing it by certified mail addressed to me at the Property Address above. A notice will be delivered or mailed to me at a different address if I give the Note Holder a notice of my different address. Any notice that must be given to the Note Holder under this Note will be given by mailing it by certified mail to the Note Holder at the address stated in Section 3 above. A notice will be mailed to the Note Holder at a different address if I am given a notice of that different address. 9. RESPONSIBILITY OF PERSONS UNDER THIS NOTE If more than one person signs this Note, each of us is fully and personally obligated to pay the full amount owed and to keep all of the promises made in this Note. Any guarantor, surety, or endorser of this Note (as described in Section 7 above) is also obligated to do these things. The Note Holder may enforce its rights under this Note against each of us individually or against all of us together. This means that any one of us may be required to pay all of, the amounts owed under this Note. Any person who takes over my rights or obligations under this Note will have all of my rights and must keep all of my promises made in this Note. Any person who takes over the rights or obligations of a guarantor, surety, or endorser of this Note (as described in Section 7 above) is also obligated to keep all of the promises made in this Note. 10. Borrower Borrower Borrower * The full principal amount of this Note and all accrued interest will be declared immediately due and payable by the Lender if: (a) all or part of the property described in the Mortgage referred to in paragraph 5 (the "Property ") is sold; or (b) if I fail to occupy the Property as my principal residence; or (c) if I omit or misrepresent a material fact in any documents executed in connection with this Note. MORTGAGE THIS MORTGAGE is made this day of 1 9 b e t w e e n t h e M o r t g a g o r (herein "Borrower "), and the Mortgagee City of Fridley a corporation organized and existing under the laws of the State of Minnesota whose address is herein "Lender"). WHEREAS, Borrower is indebted to Lender in the Principal sum of U.S. $ which indebtedness is evidenced by Borrower's note dated and extensions and renewals thereof (herein "Note "), providing for principal and interest, if not sooner paid, due and payable on TO SECURE to Lender the repayment of the indebtedness evidenced by the Note, with interest thereon; the payment of all other sums, with interest thereon, advanced in accordance herewith to protect the security of this Mortgage; and the performance of the covenants and agreements of Borrower herein contained. Borrower does hereby grant and convey to Lender, with power of sale, the following described property. located in the County of Hennepin State of Minnesota: which has the address of Street Minnesota City State Zip Code (herein "Property Address "); TOGETHER with all the improvements now or hereafter erected on the property, and all easements, rights, appurtenances and rents, all of which shall be deemed to be and remain a part of the property covered by this Mortgage; and all of the foregoing, together with said property (or the leasehold estate if this Mortgage is on a leasehold) are hereinafter referred to as the "Property ". Borrower covenants that Borrower is lawfully seized of the estate hereby conveyed and has the right to grant and convey the Property, and that the Property is unencumbered, except for encumbrances of record. Borrower covenants that Borrower warrants and will defend generally the title to the Property against all claims and demands, subject to encumbrances of record. UNIFORM COVENANTS. Borrower and Lender covenant and agree as follows: I.' Payment of Principal and Interest. Borrower shall promptly pay when due the principal and interest indebtedness evidenced by the Note and late charges as provided in the Note. 2. Application of Payments. Unless applicable law provides otherwise, all payments received by Lender under the Note and paragraph 1 hereof shall be applied by Lender first to interest payable on the Note, and then to the principal of the Note. 3. Prior Mortgages and Deeds of Trust; Charges; Liens. Borrower shall perform all of Borrower's obligations under any mortgage, deed of trust or other security agreement with a lien which has priority over this Mortgage, including Borrower's covenants to make payments when due. Borrower shall pay or cause to be paid all taxes, assessments and other charges, fines and impositions attributable to the Property which may attain a priority over this Mortgage, and leasehold payments or ground rents, if any. 4. Hazard Insurance. Borrower shall keep the improvements now existing or hereafter erected on the Property insured against loss by fire, hazards included within the term "extended coverage ", and such other hazards as Lender may require and in such amounts and for such periods as Lender may require. In the event of loss, Borrower shall give prompt notice to the insurance carrier and Lender. Lender may make proof of loss if not made promptly by Borrower. If the Property is abandoned by Borrower, or if Borrower fails to respond to Lender within 30 days from the date notice is mailed by Lender to Borrower that the insurance carrier offers to settle a claim for insurance benefits. Lender is authorized to collect and apply the insurance proceeds at Lender's option either to restoration or repair of the Property or to the sums secured by this Mortgage. 5. Preservation and Maintenance of Property; Leaseholds; Condominiums; Planned Unit Developments. Borrower shall keep the Property in good repair and shall not commit waste or permit impairment or deterioration of the Property and shall comply with the provisions of any lease if this Mortgage. is on a leasehold. If this Mortgage is on a unit in a condominium or a planned unit development, Borrower shall perform all of Borrower's obligations under the declaration or covenants creating or governing the condominium or planned unit development, the by -laws and regulations of the condominium or planned unit development, and constituent documents. 6. Protection of Lender's Security. If Borrower fails to perform the covenants and agreements contained in this Mortgage, or if any action or proceeding is commenced which-materially affects Lender's interest in the Property, then Lender, at Lender's option, upon notice to Borrower, may make such appearances, disburse such sums, including reasonable attorneys' fees, and take such action as is necessary to protect Lender's interest. If Lender required mortgage insurance as a condition of making the loan secured by this Mortgage, Borrower shall pay the premiums required to maintain such insurance in effect until such time as the requirement for such insurance terminates in accordance with Borrower's and Lender's written agreement or applicable law. Any amounts disbursed by Lender pursuant to this paragraph 7, with interest thereon, at the'Note rate, shall become additional indebtedness of Borrower secured by this Mortgage. Unless Borrower and Lender agree to other terms of payment, such amounts shall be payable upon notice from Lender to Borrower requesting payment thereof. Nothing contained in this paragraph 7 shall require Lender to incur any expense or take any action hereunder. 7. Inspection. Lender may make or cause to be made reasonable entries upon and inspections of the Property, provided that Lender shall give Borrower notice prior to any such inspection specifying reasonable cause therefor related to Lender's interest in the Property. &y 8. Condemnation. The proceeds of any award or claim for damages, direct or consequential, in connection with any condemnation or other taking of the Property, or part thereof, or for conveyance in lieu of condemnation, are hereby assigned and shall be paid to Lender, subject to the terms of any mortgage, deed of trust or other security agreement with a lien which has priority over this Mortgage. 9. Borrower Not Released; Forbearance By Lender Not a Waiver. Extension of the time for payment or modification of amortization of the sums secured by this Mortgage granted by Lender to any successor in interest of Borrower shall not operate to release, in any manner, the liability of the original Borrower and Borrower's successors in interest. Lender shall not be required to commence proceedings against such successor or refuse to extend time for payment or otherwise modify amortization of the sums secured by this Mortgage by reason of any demand made by the original Borrower and Borrower's successors in interest. Any forbearance by Lender in exercising any right or remedy hereunder, or otherwise afforded by applicable law, shall not be a waiver of or preclude the exercise of any such right or remedy. 10. Successors and Assigns Bound; Joint and Several Liability; Cc- signers. The covenants and agreements herein contained shall bind, and the rights hereunder shall inure to, the respective successors and assigns of Lender and Borrower, subject to the provisions of paragraph 16 hereof. All covenants and agreements of Borrower shall be joint and several. Any Borrower who co -signs this Mortgage, but does not execute the Note, (a) is co- signing this Mortgage only to mortgage, grant and convey that Borrower's interest in the Property to Lender under the terms of this Mortgage, (b) is not personally liable on the Note or under this Mortgage, and (c) agrees that Lender and any other Borrower hereunder may agree to extend, modify, forbear, or make any other accommodations with regard to the terms of this Mortgage or the Note without that Borrower's consent and without releasing that Borrower or modifying this Mortgage as to that Borrower's interest in the Property. 11. Notice. Except for any notice required under applicable law to be given in another manner, (a) any notice to Borrower provided for in this Mortgage shall be given by delivering it or by mailing such notice by certified mail addressed to Borrower at the Property Address or at such other address as Borrower may designate by notice to Lender as provided herein, and (b) any notice to Lender shall be given by certified mail to lender's address stated herein or to such other address as Lender may designate by notice to Borrower as provided herein. Any notice provided for in this Mortgage shall be deemed to have been given to Borrower or Lender when given in the manner designated herein. laws applicable ntog l this Mortgage shall ll he the tlaws dofothe Jurisdiction in which the Property is located. The foregoing sentence shall not limit the applicability of Federal law to this Mortgage. In the event that any provision or clause of this Mortgage or the Note conflicts with applicable law, such conflict shall not affect other provisions of this Mortgage or the Note which can be given effect without the conflicting provision, and to this end the provisions of this Mortgage and the Note are declared to be severable. As used herein, "costs ", "expenses" and "attorneys' fees" include all sums to the extent not prohibited by applicable law or limited herein. 13. Borrower's Copy. Borrower shall be furnished a conformed copy of the Note and of this Mortgage at the time of execution or after recordation hereof. 14. Rehabilitation Loan Agreement. Borrower shall fulfill all of Borrower's obligations under any home rehabilitation, improvement, repair, or other loan agreement which Borrower enters into with Lender. Lender, at Lender's option, may require Borrower to execute and deliver to Lender, in a form acceptable to Lender, an assignment of any rights, claims or defenses which Borrower may have against parties who supply labor, materials or services in connection with improvements made to the Property. 15. Transfer of the Property or a Beneficial Interest in Borrower. If all or any part of the Property or any interest in r it is sold or transferred (or if a beneficial interest in Borrower is sold or, transferred and Borrower is not a natural person) without Lender's prior written consent, Lender may, at its option, require immediate payment in full of all sums secured by this Mortgage. However, this option shall not be exercised by Lender if exercise is prohibited by federal law as of the date of this Mortgage. If Lender exercises this option, Lender shall give Borrower notice of acceleration. The notice shall provide a period of not less than 30 days from the date the notice is delivered or mailed within which Borrower must pay all sums secured by this Mortgage. If Borrower fails to pay these sums prior to the expiration of this period, Lender may invoke any remedies permitted by this Mortgage without further notice or demand on Borrower. NON - UNIFORM COVENANTS. Borrower and Lender further covenant and agree as follows: 16. Acceleration; Remedies. Except as provided in paragraph 16 hereof, upon Borrower's breach of any covenant or agreement of Borrower in this Mortgage, including the covenants to pay when due any sums secured by this Mortgage, Lender prior to acceleration shall give notice to Borrower as provided in paragraph 12 hereof specifying: (1) the breach; (2) the action required to cure such breach; (3) a date, not less than 30 days from the date the notice is mailed to Borrower, by which such breach must be cured; and (4) that failure to cure such breach on or before the date specified in the notice may result in acceleration of the sums secured by this Mortgage and sale of the Property. The notice shall further inform Borrower of the right to reinstate after acceleration and the right to bring a court action to assert the nonexistence of a default or any other defense of Borrower to acceleration and sale. If the breach is not cured on or before the date specified in the notice, Lender, at Lender's option, may declare all of the sums secured by this Mortgage to be immediately due and payable without further demand and may invoke the power of sale hereby granted and any other remedies permitted by applicable law. Lender shall be entitled to collect all reasonable costs and expenses incurred in pursuing the remedies provided in this paragraph 17, including, but not limited to, reasonable attorneys' fees. If Lender invokes the power of sale, Lender shall cause a copy of a notice of sale to be served upon the person, if any, in possession of the Property. Lender shall publish a notice of sale and the Property shall be sold at public auction in the manner prescribed by applicable law. Lender or Lender's designee may purchase the Property at any sale. The proceeds of the sale shall be applied in the following order: (a) to all sums secured by this Mortgage; (b) to all reasonable costs and expenses of the sales, including, but not limited to, reasonable attorneys' fees and costs of title evidence; and (c) the excess, if any, to the person or persons legally entitled thereto. 17. Borrower's Right to Reinstate. Notwithstanding Lender's acceleration of the sums secured by this Mortgage due to Borrower's breach. Borrower shall have the right to have any proceedings begun by Lender to enforce this Mortgage discontinued at any time prior to the earlier to occur of (i) sale of the Property pursuant to the power of sale contained in this Mortgage or (ii) entry of a judgment enforcing this Mortgage if: (a) Borrower pays Lender all sums constituting the default actually .existing under this Mortgage and the Note at the commencement of foreclosure proceedings under this Mortgage; (b) Borrower cures all breaches of any other covenants or agreements of Borrower contained in this Mortgagee; (c) Borrower pays all reasonable expenses incurred by Lender in enforcing the covenants and agreements of Borrower contained in this Mortgage, and in enforcing Lender's remedies as provided in paragraph 17 hereof, including, but not limited to, reasonable attorneys' -fees; and (d) Borrower takes such action as Lender may reasonably require to assure that the lien of this Mortgage, Lender's interest in the Property and Borrower's obligation to pay the sums secured by this Mortgage shall continue unimpaired. Upon such payment and cure by Borrower, this Mortgage and the obligations secured hereby shall remain in full force and effect as if no acceleration had occurred. 18. Assignment of Rents; Appointment of Receiver. As additional security hereunder, Borrower hereby assigns to Lender the rents of the Property, provided that Borrower shall, prior to acceleration under paragraph 17 hereof or abandonment of the Property, have the right to collect and retain such rents as they become due and payable. Upon acceleration under paragraph 17 hereof or abandonment of the Property, and at any time prior to the expiration of any period of redemption following sale of the Property, lender shall be entitled to have a receiver appointed by a court to enter upon, take possession of and manage the Property and to collect the rents of the Property including those past due. All rents collected by the receiver shall be applied first to payment of the costs of management of the Property and collection of rents, including, but not limited to, receiver's fees, premiums on receiver's bonds and reasonable attorneys' fees, and then to the sums secured by this Mortgage. The receiver shall be liable to account only for those rents actually received. 19. Release. Upon payment of all sums secured by this Mortgage, Lender shall discharge this Mortgage without charge to Borrower. Borrower shall pay all costs of recordation, if any. 20. Waiver of Homestead. Borrower hereby waives all right of homestead exemption in the Property. 21. Acceleration. Lender may declare all amounts secured by this Mortgage due and payable if: (a) Borrower fails to occupy the Property as his or her principal residence; or (b) Borrower omits or misrepresents a material fact in any documents executed in connection with this Mortgage. REQUEST FOR NOTICE OF DEFAULT AND FORECLOSURE UNDER SUPERIOR MORTGAGES OR DEEDS OF TRUST Borrower and Lender request the holder of any mortgage, deed of trust or other encumbrance with a lien which has priority over this Mortgage to give Notice to Lender, at Lender's address set forth on page one of this Mortgage, of any default under the superior encumbrance and of any sale or other foreclosure action. IN WITNESS WHEREOF, Borrower has executed this Mortgage. Borrower Borrower STATE OF MINNESOTA Count ss: The foregoing instrument was acknowledged before me this by (date) (person acknowledging) My commission Expires: Notary Public This instrument was prepared by of (Name) (Address) Minnesota. a° 0 4A-, Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 1, 1993 04- . TO: William Burns, Executive Director of HRA 41 FROM: Barbara Dacy, community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Resolution Authorizing Rental Rehabilitation Loan Program Proposed for HRA consideration is the last of the resolutions which must be adopted. This resolution authorizes implementation of the Rental Rehabilitation Loan Program which is funded through the Minnesota Housing Finance Agency. The program will provide low interest loans for improvements to residential rental property. Eligible owners can borrow up to $15,000 for single unit properties or the lesser of $8,000 per unit or $40,000 per building for multi- unit properties. In an effort to reduce the borrower's costs, the HRA will provide a deferred loan in conjunction with the primary loan. The deferred loan will be equal to 10% of the primary loan. The HRA loan does not have to be repaid until the property is sold. Fridley State Bank has agreed to take applications and perform underwriting functions for the HRA. The Bank will also close the primary loans and the HRA deferred loans. The HRA will conduct initial and final inspections. We hope to have this program available in early August. GF:ls M -93 -393 4.2 RESOLUTION NO. A RESOLUTION ESTABLISHING A RENTAL REHABILITATION LOAN PROGRAM; ESTABLISHING THE AREA OF OPERATION; PROVIDING FOR THE DELEGATION OF CERTAIN POWERS AND DUTIES; AUTHORIZING THE EXECUTION OF A MEMORANDUM OF UNDERSTANDING BY AND BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY AND THE FRIDLEY STATE BANK; AUTHORIZING EXECUTION OF AN ADMINISTRATION CONTRACT WITH THE MINNESOTA HOUSING FINANCE AGENCY. BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority "), as follows: Section 1. Recitals. 1.01. It has been proposed that the Authority establish a Rental Rehabilitation Loan Program (the "Program ") for the residents of the City of Fridley (the "City "). 1.02. It has been further proposed that the Authority participate with the Minnesota Housing Finance Agency (the "M.H.F.A. ") to secure funding and that the Authority provide its funds for additional assistance and that the Authority enter into an Administration Contract with the M.H.F.A. 1.03. It has been further proposed that the Authority enter into the necessary agreements to implement the Program including a Memorandum of Understanding (the "Memorandum ") with the Fridley State Bank (the "Bank ") as a participating lender. Section 2. Findings. 2.01. The Authority hereby finds that its area of operation in which to implement the Program is the area within the territorial boundaries of the City as provided for in Minnesota Statutes, Section 469.002, Subd. 8. 2.02. The Authority hereby finds that the adoption of the Program promotes the purposes of the Authority as those purposes are defined in Minnesota Statutes, Section 469.001, et sea. (the "Act "). 2.03. The Authority hereby finds that the Program will assist in the alleviation of shortages of decent, safe and sanitary residential housing available within the City.at prices affordable to persons and families of low or moderate income as described therein. 2.3 Page 2 - Resolution No. 2.04. The Authority hereby finds that preservation of the quality of life in the City is dependent upon the maintenance, provision, and preservation of an adequate housing stock; that accomplishing the is a public purpose in that there are many residences in the City which require rehabilitation; that a need exists to provide in a timely fashion affordable housing to persons of low and moderate income as described in the Act and herein residing and expected to reside in the City; that many owners, would -be purchasers or providers of residences are unable to obtain mortgage credit for rehabilitation of residences under current market conditions; and that in establishing its Program the Authority is acting in all respects to benefit the citizens of the City and to serve a public purpose in improving and otherwise promoting their health, welfare and prosperity. Section 3. Authorization of Program. 3.01. The Authority hereby approves and adopts the Program as described on Schedule A attached to this Resolution. Section 4. Delegation of Power and Duties. 4.01. In accordance with the Act, specifically Minnesota Statutes, Section 429.012, Subd. 1(3), and in accordance with the Program Description and Guidelines, the officers, agents and employees of the Authority are hereby authorized to take such actions as may be necessary to implement the Memorandum and operate the Program. 4.02. The Executive Director or Housing Coordinator are hereby authorized to execute all documents relating to the approval and closing of any loans provided for in the Program. Section S. Authorization for Execution of Memorandum. 5.01. The Authority hereby approves the Memorandum substantially in the form presented to the Authority and authorizes its Chairman and Executive Director to execute the Memorandum on behalf of the Authority with such additions and modifications as those officers may deem desirable or necessary as evidenced by the execution thereof. Section 6. Authorization for Execution of Administration Contract. 6.01. The Authority hereby approves the Administration Contract substantially in the form presented to the Authority and authorizes its Chairman and Executive Director to execute the Administration Contract on behalf of the Authority with such additions and modifications as those officers may deem desirable or necessary as evidenced-by the execution thereof. Page 3 - Resolution No. PASSED AND ADOPTED BY THE FRIDLEY HOUSING AUTHORITY OF THE CITY OF FRIDLEY THIS 1993. ATTEST: 4.3 AND REDEVELOPMENT DAY OF , LAWRENCE R. COMMERS - CHAIRPERSON WILLIAM W. BURNS - EXECUTIVE DIRECTOR 4.4 CERTIFICATION I, William W. Burns, Executive Director of the Housing and Redevelopment Authority in and for the City of Fridley, County of Anoka, Minnesota, hereby certify that the foregoing is a true and correct copy of Resolution No. passed by the Authority on the day of , 1993. WILLIAM W. BURNS - EXECUTIVE DIRECTOR f 4.5 SCHEDULE A DESCRIPTION AND GUIDELINES FOR THE RENTAL REHABILITATION LOAN PROGRAM Loan Description M.H.F.A. Primary Loan: At 7.45% for rental property improvements. Maximum term of 15 years; amount based on number of units in the building; $15,000 maximum for single -unit, lesser of $8,000 per unit or $40,000 per building. Authority Deferred Loan: 10% of the M.H.F.A. Primary Loan. Funding Sources Minnesota Housing Finance Agency (M.H.F.A.) for Primary Loan; Authority for Deferred Loan. Participating Lender Fridley State Bank. ualifications Income Limits: N/A Underwriting: Normal Bank Standards Equity: Normal Bank Loan to Value Percentage Property Type: Any Residential Rental Property; Property is Subject to other M.H.F.A. Program Requirements Program Enhancements Deferred Loan will be secured, but subordinate to the Primary Loan. The Deferred Loan principal payment is deferred until property is sold. No interest is charged on the Deferred Loan. t MINNESOTA HOUSING FINANCE AGENCY RENTAL REHABILITATION LOAN PROGRAM 4.6 ADMINISTRATION CONTRACT THIS AGREEMENT, dated this day of , 198 , by and between the Minnesota Housing Finance Agency, 400 Sibley Street - Suite 300, St. Paul, Minnesota 55101 (hereinafter called "the MHFA") and of Minnesota (herein- after called the "Administering Entity "). W I T N E S S E T H WHEREAS, under the provisions of Chapter 462A of Minnesota Statutes, MHFA is author- ized to make or *purchase loans, the proceeds of which are to be expended for energy improvements to rental properties necessary to bring the improved properties into compli- ance with Subdivision 3 of Minnesota Statutes Chapter 116J.27, and for such other moder- ate rehabilitation as is approved by MHFA pursuant to the MHFA Rental Rehabilitation Loan Program (hereinafter called "the Program "); and WHEREAS, an additional requirement of the Program is that at the time of closing of the loan the dwelling units in the property to be improved be rented or intended for ren- tal primarily to Persons and Families of Low and Moderate Income as defined in the Program and in MHFA Rules and Regulations; and WHEREAS. MHFA desires to obtain the services of the Administering Entity in locating properties suitable for participation in the Program and to otherwise assist in the imple- mentation of the Program so as to maximize the benefits afforded by it and the Administer- ing Entity is willing to provide those services on the basis of the terms and conditions set forth below; and WHEREAS, _ agreed to apply chase that are Entity. to MHFA to participate funded under the Program is an authorized MHFA lender and has in the Program and submit to MHFA Notes for pur- and made in consultation with the Administering NOW, THEREFORE, in consideration of the covenants herein contained and the mutual benefits to be derived therefrom, it is hereby agreed between the parties hereto as fol- lows: 1. This Administration Contract shall consist of the terms and conditions hereof. and of the MHFA Rental Rehabilitation Loan Program Procedural Manual (hereinafter called "the Procedural Manual "), as from time to time amended and supplemented, the provisions of which are hereby incorporated by reference into this Administration Contract. 2. The Administering Entity represents and warrants that it is a legally constituted pub- lic or governmental entity or nonprofit incorporated organization and that it shall maintain adequate capital and personnel for the proper administration of this Adminis- tration Contract. 3. The Administering Entity commencing from the date hereof and in accordance with the provisions of the Procedural Manual, shall have the responsibilities and perform the services as follows: (a) Upon request, submit to MHFA a copy of the HUD Equal Opportunity Housing Plan and the Administrative Plan applicable to its operations for review by the Fair Hous- ing /Equal Opportunity staff; and (b) Identify properties within its area of responsibility which are Eligible Proper- ties under this Manual; and C 4.7 (c) Contact owners of such Properties who are eligible Borrowers under the Program to determine their interest in the Program; and (d) Communicate with the participating lending institution (hereinafter called "the Seller ") which will fund the note (hereinafter called "the Note ") to be acquired by MHFA under this Program; and (e) Assist the applicants in the preparation of MHFA loan application materials for submission to the Seller; and (f) In accordance with applicable Program requirements, enter into an Escrow Agree- ment with Borrowers whereby the Administering Entity shall hold the proceeds of the loan and disburse them as progress payments to the contractor(s); and (g) In accordance with applicable Program requirements, inspect. the site during con- struction and prior to final disbursement of funds to the contractor(s) to insure that the improvements are constructed in accordance with the plans and specifi- cations agreed to between the Borrower and contractor(s), that good workmanship and materials are used, and that the Property is brought into compliance with the state rental property energy standards; and (h) Upon request, assist MHFA or its agent with loan collection efforts. 4. This Administration Contract may be terminated at any time by either party hereto upon ten days prior written notice to the other party. In the event of such termination, Administering Entity agrees to perform the services provided herein for all properties for which loans under the Program are closed by the Seller. 5. Any notice required hereunder shall be sufficient only if in writing, and sent by pre- paid, registered, or certified mail (return receipt requested) to the business address of the other party hereto. Such business address shall be that address specified herein or such different address as may hereafter be specified by either party by written notice to the other. 6. Administering Entity shall receive compensation for its services hereunder only in the manner specifically provided in the Procedural Manual. 7. Neither party may assign its rights or obligations under this Administration Con- tract. No change or modification of the terms or provisions of this Administration Contract shall be binding on MHFA unless such change or modification be in writing and be signed by an authorized official of MHFA. Neither the failure by MHFA in any one or more instances to insist upon the observance or performance of any term or provi- sion thereof, nor the failure of MHFA to exercise any right, privilege, or remedy con- ferred herein or afforded by law, shall be construed as waiving any breach of any term, provision, or the right to exercise such right, privilege or remedy thereafter. 10/13/86 0121f 1 l 4.8 This Administration Contract embodies the entire agreement between MHFA and the Admin- istering Entity and there are no other agreements, either oral or written, between the parties on the subject matter hereof. 8. All matters, whether in tort or in contract, relating to the validity, construction, performance or enforcement of this Administration Contract shall be determined accord- ing to the laws of the State of !Minnesota. 9. If any term or provision of this Administration Contract is finally adjudged by any court to be invalid, the remaining terms and provisions shall remain in full force and effect, and they shall be interpreted, performed, and enforced as 'if said invalid provision did not appear herein. IN WITNESS WHEREOF. the parties hereto have set their hands the day and year above written. IN PRESENCE OF: ADlMINISTERING ENTITY (Name of Agency) IN PRESENCE OF: By: Its: By: Its: MINNESOTA HOUSING FINANCE AGENCY 10/13/86 0121f MEMORANDUM OF IINDERSTANDING 4 ■9 Rental Rehabilitation Loan Program THIS AGREEMENT, dated this day of , 19 , by and between the Fridley Housing and Redevelopment Authority (hereinafter referred to as the "HRA") a public body corporate and politic existing under the laws of the State of Minnesota, and Fridley State Bank (here- inafter referred to as the "Lender ") a WITNESSETHS WHEREAS, the parties have discussed their joint participation in the Minnesota Housing Finance Agency's Rental Rehabilitation Loan Program (hereinafter referred to as the "Program ") and have entered into separate agreements with the Minnesota Housing Housing Finance Agency for administration of the Program; and WHEREAS, this agreement is not intended to void or supercede any agreements either party has with the Minnesota Housing Finance Agency (hereinafter referred to as the "MHFA ") for the Program. NOW, THEREFORE, the parties hereto do hereby consent and agree as follows; 1. The purpose and intent of this agreement is to outline the responsibilities of each party with respect to funds provided by the HRA for deferred loans (hereinafter referred to as "Deferred Loan ") to be used in conjunction with the Program. 2. The HRA will provide, subject to its approval, Deferred Loans to eligible borrowers. 3. Deferred Loans shall be defined as a loan without interest, secured to the property to be improved by a mortgage, in an amount equal to 10% of the primary loan amount. Said Deferred Loan may be applied either A) against the primary loan, or B) be used in addition to the primary loan, but only where the eligible improvement costs exceed what the Borrower has been approved to receive under the Program. Option B is subject to HRA approval. 4. Eligible borrowers (hereinafter referred to as the "Borrower ") are defined as those individuals who meet the criteria of the Program as defined by the MHFA Rental Rehabilitation Loan Program Procedural Guide and have been approved by the Lender. 5. The primary loan shall be defined as a loan.approved by the Lender and financed through the Program. 6. The Lender will submit a Request for Deferred Loan Commitment to the HRA on a form as evidenced by Exhibit A with the necessary attachments. The HRA shall have 5 business days from the receipt of the request to notify the Lender of its approval. The HRA will forward a check or transfer funds in the amount of the Deferred Loan to an escrow account maintained.by the Lender on behalf of the Borrower. 7. The Lender shall ensure that the Borrower executes at the time of closing all documents necessary to secure the Deferred Loan, including but not limited to the Deferred Loan Repayment Agreement and Mortgage (hereinafter referred to as the "Mortgage ") as evidenced by Exhibit B, and an escrow agreement as evidenced by Exhibit C. S. Further, Lender shall submit the Mortgage to Anoka County for proper recording. Lender shall submit to the HRA an invoice for all recording fees incidental to the Mortgage. The HRA shall provide the Lender with a supply of blank Mortgage forms. Upon receipt of the recorded mortgage from Anoka County, the Lender shall promptly return said document to the HRA. 9. The Lender shall disburse the Deferred Loan funds held in escrow to the Borrower upon receipt of a fully executed Completion Certificate, as evidenced by Fxhibit D. 3 4.10 10. This agreement may be modified from time to time, but only in writing and by mutual consent of the parties. In addition, this agreement may be terminated with or without cause by either party by giving at least 30 days written notice. IN WITNESS WHEREOF, the parties hereto, by and through their authorized representatives, have set their hands and executed this Agreement the day and date stated next to their signature. FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY The day of , By:_ 19 Its.: The day of , By:_ 19 Its. FRIDLEY STATE BANK The day of , By: 19 Its: The day of , By: 19 Its: c:\WP\NW Exhibit A 4.11 Fridley Housing and Redevelopment Authority Rental Rehabilitation Loan Program REQUEST FOR DEFERRED LOAN COMMITMENT Date: To: Grant Fernelius Fridley HRA 6431 University Avenue N.E. Fridley, MN 55432 From: Fridley State Bank 6315 University Avenue N.E. Fridley, MN 55432 Borrower Information Name /s: Property Address: Please attach copies of the following documents to this form: - Signed Application - Credit Bureau Report - Income Verification (if applicable) - Title Verification - Contractor Bid /s Loan Information 1).Rental Rehab Loan Amount: $ 2) Requested Deferred Loan,Amount $ 3) Estimated Closing Date: FRIDLEY STATE Signature Title Phone No. HRA Approval I hereby approve this Request for a Deferred Loan Commitment in the amount of $ to This Commitment will expire in 30 days, unless the HRA authorizes written extension. Approval is subject to the terms and conditions described in Memorandum of Understanding between Fridley HRA and Fridley State Bank. Signature Title Date t Exhibit B 4.12 FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY RENTAL REHABILITATION LOAN PROGRAM DEFERRED LOAN REPAYMENT AGREEMENT AND MORTGAGE THIS AGREEMENT, made and entered into this day of , 19 , (hereinafter referred to as "Effective Date "), by and between (hereinafter collectively referred to as "Borrower "), and 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, having its principal office at 6431 University Avenue N.E., Fridley, Minnesota 55432 (hereinafter referred to as "Lender "). WHEREAS, on Lender agreed to provide Borrower with a no- interest loan (hereinafter referred to as "Deferred Loan "), in the amount of Dollars ( ), the receipt of which is hereby acknowledged by Borrower, for the purpose of completing rehabilitation work on the real estate legally described below; and WHEREAS, Borrower and Lender desire to set forth herein the provisions for Borrower's repayment of the Deferred Loan, and to provide for securing said repayment with a mortgage (hereinafter referred to as "Mortgage ") on the real-estate legally described below. NOW, THEREFORE, in consideration of said Deferred Loan and in accordance with Minnesota Statutes, the parties do hereby agree as follows: 1. Borrower covenants and agrees with Lender to pay to the order of Lender the principal sum of the Deferred Loan, without interest, at the office of Lender in Fridley, Minnesota, or at such other place as Lender may designate in writing delivered or mailed to Borrower, upon the occurrence of any of the following events after the Effective Date: a. When the real estate legally described below is sold, transferred, or otherwise conveyed (whether by deed, contract for deed, or otherwise); and whether voluntary or involuntary. Repayment of the Deferred Loan as required under the terms of this paragraph 1 shall be made not later than the thirtieth (30th) day after the earlier of the following: (a) the date of the sale, transfer, or other conveyance referred to in paragraph 1(a), above. 2. As security for Borrower's personal covenant and obligation for repayment as herein provided, and subject to the terms and conditions of this Agreement, Borrower hereby grants, and the Lender shall and hereby does have, a Mortgage lien on the real estate legally described below, together with all hereditaments and appurtenances thereto, in the full amount necessary to satisfy repayment of said Deferred Loan. The said real estate subject to said Mortgage lien is situate in Anoka County, Minnesota, and is legally described as follows: 3. Promptly after the date of any sale, transfer or other conveyance of the above - described real estate, Borrower or his /her heirs, executors, representatives, hereby covenant and agree to give notice to Lender thereof. 4. In the event Borrower or his /her heirs, executors, representatives shall fail or refuse to make a required payment within said limited period as described in paragraph 1, Lender may, with or without notice to Borrower, foreclose said lien in the same manner as action for foreclosure of mortgages upon real estate, as provided by statute. -1- 5. This Agreement shall run with the aforesaid real estate and shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, representatives, successors, and assigns. 6. If this Agreement is executed by a contract for deed vendor of the property, as one of the Borrower's, such execution shall be deemed for the purpose of establishing and continuing the existence of the indebtedness described herein and the lien granted herein. However, in the event of default of the terms hereof, neither Lender nor its assigns shall take any action against such contract for deed vendor except such as may be necessary in order to subject to the satisfaction of said indebtedness of the real estate legally described herein. IN TESTIMONY WHEREOF, the parties have executed this Agreement as of the day and year first above written. FRIDLEY HOUSING AND BORROWER REDEVELOPMENT AUTHORITY By: Its: By: Its: STATE OF MINNESOTA ) COUNTY OF ss. On this day of , 19 , before me a Notary Public within and for said County, personally appeared to me known to be the person(s) described in, and who executed the foregoing instrument, and acknowledged that _he executed the same as free act and deed. Notary Public STATE OF MINNESOTA COUNTY OF ; SS. On this day of , 19 , before me a Notary Public within and for said County, personally appeared in, and who executed the foregoing instrument, and acknowledged sthats —heed executed the same as free act and deed. Notary Public STATE OF MINNESOTA COUNTY OF ss. On this day of , 19 , before me a Notary Public within and for said County, personally appeared to me known to be the Personns) described in, and who executed the foregoing instrument, and acknowledged that he executed the same as free act and deed. Notary Public 0= 4.13 t STATE OF MINNESOTA ) ss. COUNTY OF ) On this day of , 19 , before me a Notary Public within and for said County, personally appeared , to me known to be the person(s) described n, and who executed the foregoing instrument, and acknowledged that he_ executed the same as free act and deed. Tax Statements for the real property described in this instrument should be sent to: This instrument was drafted by: Fridley Housing and Redevelopment Authority 6431 University Avenue N.E. Fridley, Minnesota 55432 ? ?? exempt from mortgage registration tax ? ?? -3- B:\REPAYMEN Notary Public 4.14 Exbibit C 4.15 HIHN &SOTA MOUSING FLNANCS AG&KCY RE1� ='AL REKABILITATIOK LOAN PRWJM ESCROW AGREEMENT TKIS AGREElMNP, made and entered into this _ day of 19 , by and between of having its fice at (hereinafter called "the Agent°,%, and ' Minnesota Of collectively called "the Borrower -). ' Minnesota (hereinafter WITNESSETM: WKEREAS, the Minnesota Mousing Finance Agency (hereinafter called 'the MKFA ) is the purchaser of a loan to improve Borrower's residen- tial rental property located on. the following describe tract, to wit: which loan is in the original principal sum of $ dated , 198 (hereinafter called -the and Is Loan-); and WMBREAS, said Loan was funded pursuant to the aMFA Rental Rehab_ 111tation Loan Program (hereinafter called -the program"), the pro - ceds of which Loan are to be expended for energy Improvements sary to bring the subject property into neces- compliance with Subdivision 3 of Minnesota Statutes Chapter 116.7.27, and for such other rehabili_ tation as is approved by MKFA pursuant to said program; and WHEREAS, the Borrower, the Agent, and MKPA desire that the pro_ cases of said Borrower's Loan be placed into For disbursement to a contractor, so as to be assured that the Loan an escrow account t or will be devoted to the purposes provided a the program. A►OW of THEREFORE, in consideration of an Escrow administration fee ; paid by Borrower to Agency herein contained and the mutual benefits to be der ved therefrom cov enants It agreed between the parties hereto as follows: 1. The Borrower shall and hereby does deposit the proceeds of the Loan in the amount of f sufficiency of which with the Agent, the receipt and are hereby acknowledged by Agent, to be Placed into Agent's trust account for disbursement in the manner hereinafter provided. 2. Agent -shall review the contract(s) entered into between Borrower and the contractor(s), to be assured that vide(s), as a minimum, the following; the contract(s) pro_ a. That the total contract sum for construction shall not exceed for all materials supplied and services performed, of which total the shall not exceed amount funded by this Loan b• That the cons tructlon to be performed shall under the requirements of be the pr authorized exceed the plans ands Program and shall meet or to exceed th t,, _ � _ pecificatigns for such work as agreed �r -N,-N, ari :;orLraczor(sJ. C. That construction be completed within mencement of construction, Provided that ally co ttrttcuon must be completed within nine months of the date of the note secured by the Mortgage. d. That contractor(s) deliver to Borrower a warranty. e. That the contractor(s) provide evidence of workman's compen- sation Insurance coverage. , . ... f. That the contractor(s) deliver lien waivers and sworn con- struction statements to Agency for each required draw of the construction contract amount. g. That the Borrower approve all construction draws. 3. That construction draws be in such numbers and amounts as to pro- tect the Borrower's interest in the successful completion of con- struction. 4. That a reasonable retatnage be withheld from the contractor(s) before completion of construction. S. Agent shall inspect the site during construction and prior to final disbursement of funds to the contractor(s) to insure that the improvements are constructed in accordance with the plans and specifications agreed to between the Borrower and 'contractor(s), that good workmanship and materials are used, and that the struc- ture is brought into compliance with Subdivision 3 of Minnesota Statutes Chapter 116J.27. 6. The Agent shall receive compensation for its services hereunder only in the manner specifically provided in the Procedural Manual. 7. The parties hereto agree that upon the discharge of the duties undertaken herein by the Agent in accordance with the provisions as set forth, the Agent shall have no further liability to the Borrower arising from this Escrow Agreement. 8. This Escrow Agreement is not assignable without the prior written consent of ANFA. 9. This Escrow Agreement shall be binding upon and inure to the bene- fit of the parties hereto and their respective heirs, executors, administrators, successors, and assigns. IN WITNESS WHEREOF, the parties hereto have executed this Escrow Agreement the day and year first above written. IN PRESENCE OF: IN PRESENCE OF: By AGENT (Name of Agency) 4.16 MINNESOTA HOUSING FINANCE AGENCY Exhibit D RENTAL REHABILITATION LOAN PROGRAM COMPLETION CERTIFICATE Borrower MHFA Loan No. Property Address CONTRACTOR Fridley HRA Administering Entity The undersigned hereby certifies that the improvements contemplated by the MHFA Credit Application for a Rental Rehabilitation Loan pertaining to the above Loan, have been completed in their entirety and in accordance with the agreement(s) between the undersigned and the owner(s) relating thereto, and that all performed by the undersigned is subject to and in conformity with the Contractor Warranty. Contractor Contractor's Address City State zip Phone X $ Signature Date Paid Amount BORROWER I (we) hereby certify that the contractor listed above has completed the work and /or delivered all materials for the home improvements specified in the MHFA Credit Application for the above- referenced loan, in full compliance with the terms of the contract evidencing the agreement between the undersigned and said contractor. The undersigned further hereby authorize(s) the Administering Entity and acting as Agent to disburse in my (our) behalf MHFA Loan Funds held in escrow. Said disbursement shall be made directly to the contractor contributing services or materials for the approved improvements. X Signature Date ADMINISTERING ENTITY The undersigned, acting as Administering Entity and Agent, hereby certifies that the above- referenced loan is in conformity with the MHFA Rental Rehab- ilitation Loan Program Administration Contract and Procedural Manual including, specifically the requirements therein provided for dwelling energy efficiency; that the improvements which are the subject of the loan have been completed; that the Administering Entity's Participation Procedures as set forth in the Procedural Manual are applied to the above loan, true and correct; and that this Completion Certificate is given as evidence of the Administering Entity's compliance with the provisions os the Rental Rehab- ilitation Loan Program Administration Contract. X Housing Coordinator Date X Inspector Date C:\PdWCMPCRT 4.17 i 5.1 Community Development Department HousmG arm REDEVELOPMENT AtTTHORITY City of Fridley DATE: July 1, 1993 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Resolution Regarding Contract Inspectors for Housing Rehabilitation Program Proposed for HRA consideration is a resolution which authorizes staff to enter into an agreement for inspection services. All properties financed through our programs will be inspected prior to committing HRA funds. The inspection will ensure that the property meets basic. code requirements (i.e., electrical, plumbing, mechanical, health and safety). We met with Tom Blaz_ina, Chief Building Official, to develop a list of minimum qualifications for the inspectors. He suggested we contract with building inspectors from other communities. Inspections could be conducted in the evening which would obviously be convenient for the homeowner. Our plan is to utilize two to three contract inspectors for the program and compensate them on a flat rate basis of $105 for initial inspections and $70 for final inspections (if necessary). In order to meet the program. schedule, we will need to have. the inspectors under contract by no later than August 1, 1993. GF:ls M -93 -394 � a 5.2 RESOLUTION NO. A RESOLUTION AUTHORIZING EXECUTION OF A CONTRACT FOR HOUSING REHABILITATION INSPECTION SERVICES. BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority "), as follows: Section 1. Recitals. 1.01. It has been proposed that the Authority provide housing inspections for its loan programs and contract with independent inspectors for the inspection of properties. Section 2. Findings. 2.01. The Authority has developed several housing rehabilitation programs which require the inspection of properties. Section 3. Authorization. 3.01. The Executive Director or Housing Coordinator are hereby authorized to select independent fee inspectors for the inspection of properties. 3.02. The Authority hereby approves the Contract for Housing Rehabilitation Inspection Services (the "Contract ") substantially in the form presented to the Authority and hereby authorizes the Executive Director or Housing Coordinator to execute the Contract on behalf of the Authority with such additions and modifications as those persons may deem desirable or necessary as evidenced by the execution thereof. PASSED AND ADOPTED BY THE FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF FRIDLEY THIS DAY OF , 1993. LAWRENCE R. COMMERS - CHAIRPERSON ATTEST: WILLIAM W. BURNS - EXECUTIVE DIRECTOR 5.3 CERTIFICATION I, William W. Burns, Executive Director of the Housing and Redevelopment Authority in and for the City of Fridley, County of Anoka, Minnesota, hereby certify that the foregoing is a true and correct copy of Resolution No. passed by the Authority on the day of , 1993. WILLIAM W. BURNS - EXECUTIVE DIRECTOR F 5.4 contract for Housing Rehabilitation Inspection Services THIS AGREEMENT, entered into as of this day of , 1993, by and between the Fridley Housing and Redevelopment Authority (here- inafter referred to as the "HRA") a public body corporate and politic exist- ing under the laws of the State of Minnesota, and (hereinafter referred to as the "Contractor ") an individual residing at WITNESSETH: WHEREAS, the HRA has determined the need to preserve the existing housing stock within the City of Fridley, Minnesota; and WHEREAS, the HRA has developed several housing rehabilitation programs to meet these needs; and WHEREAS, the HRA has determined that it is necessary to conduct inspections of properties which will benefit from said programs; and WHEREAS, the HRA has determined it would be cost efficient to contract said inspections with an independent fee inspector and desires to engage the professional services of the Contractor. NOW, THEREFORE, the parties hereto mutually agree as follows: 1. Scope of Services: The Contractor shall perform all of the services under this Agreement in connection with the housing rehabilitation programs, including: 1) Determine the existing conditions of the electrical, plumbing, structural, and health and safety systems. 2) Develop a list of minimum improvements which must be corrected. The Contractor shall use an inspection form approved by the HRA to complete the report (see Exhibit A). 2. Time of Performance: The services of the Contractor are to be conducted on a project -by- project basis. The Contractor shall only proceed with an inspection after receiving an Inspection Work Order (see Exhibit B). The Contractor shall commence the inspection within a reasonable time period, but in no event later than 10 business days after receipt of the Inspection Work Order. The inspection shall be conducted and completed in a professional manner and between the hours of 8:00 a.m. and 9:00 p.m. The Contractor shall be responsible for contacting the owner and scheduling the inspection; the Contractor shall make every effort to accommodate the owner by scheduling a time that is convenient for the owner. The owner shall be furnished with a written copy of the report within 5 business of the inspection, and the original must be submitted to the HRA during the same period. 5.5 3. Compensation: Compensation shall be paid to the Contractor based on the following fee schedule: $105.00 Initial Inspection $70.00 Final Inspection Compensation shall cover all costs related to the inspection, including overhead, mileage, phone, etc. 4. Method of Payment: The HRA shall pay the Contractor once a month for services completed. In order to receive payment, the Contractor must furnish an invoice to the HRA by first Wednesday of the month. The invoice must clearly identify the following: a) Name and address of property owner b) Date of inspection c) Amount due to Contractor The HRA will verify that the original inspection report was received and a copy sent to the property owner. Payment will then be processed and sent to the Contractor at the address identified above by the 15th of the month. S. Amendments: This Agreement may be amended from time to time, but only mutual written consent of the parties. 6. Assignment and Subcontracting: The Contractor may not assign or subcontract any portion of this Agreement without the written consent of the HRA, and it is further agreed that said consent must be sought by the Contractor not less than fifteen (15) days prior to the date of any proposed assignment. 7. Hold Harmless and Indemnification: The Contractor agrees to protect and save the HRA, its Board of Commissioners, agents, and employees while acting in the scope of their duties as such, harmless from and against all claims, demands, and causes of action of any kind or character, including the cost of defense thereof, arising in favor of the Contractor on account of personal injuries, death or damage to property arising out of services performed or omissions of services or in any way resulting from acts or omissions of the Contractor. 8. Data Privacy: All information generated as a result of the Contractors services are considered confidential. The Contractor shall refrain from disclosing any of the information contained in the report with anyone except, the property owner, HRA or authorized employees of the City of Fridley. 9. Termination: This Agreement may be terminated, with or without cause by the HRA, by providing the Contractor with written notice. Any work in progress, including inspection reports, notes, etc. shall be forwarded to the HRA immediately, and the Contractor shall be 5.6 9. Termination (cont.): compensated on a pro -rata basis for said work. 10. Nondiscrimination: The Contractor shall comply with all federal, state and local laws prohibiting discrimination on the basis of age, sex, marital status, race, creed, color, national origin, reliance on public assistance or the presence of any sensory, mental or physical handicap. IN TESTIMONY HEREOF, the parties hereto have executed this agreement. FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY Executed this day of , 19 CONTRACTOR By: Its: Executed this day of By: , 19 Its: C: \WP \REHABCON 5.7 FRIDLEY BRA HOUSING REHABILITATION INSPECTION REPORT EXHIBIT A The purpose of this report is determine the minimum improvements which must be corrected as part of•the Fridley Housing Rehabilitation Program. The intent of this report is ensure that basic code related items are addressed as part of the financial assistance package. Note to Inspector: If more space is needed, please use reverse side of this page. Property Address: Inspection Date: ELECTRICAL SYSTEM 5.8 HEALTH AND SAFETY SYSTEMS I hereby certify that I have inspected the above property and have noted all code related corrections for the systems identified. I have provided the homeowner with a copy of this report and will forward the original the Fridley HRA. Inspector's Signature Date A 5.9 EXHIBIT B: Inspection Work order Date Issued: To: From: Grant Fernelius, Housing Coordinator Fridley HRA 6431 University Avenue N.E. Fridley, MN 55432 #572 -3591 You are hereby authorized to proceed with the following inspection: Initial Property Inspection Final Property Inspection Address Owner City State zip Phone Please contact the owner directly to schedule the inspection. The above inspection must be completed within 10 business days of the issuance of this work order. After completing the inspection, please send a copy of your report to the owner and the original to the HRA. If you have any questions, please feel free to call me at 572 -3591. Sincerely, Grant Fernelius Housing Coordinator 6.1 MOCU ION NO. - 1993 •JDti �) • / • • 1 M •J PQ, ID wti•J• • C tt I` 1)D1 al•J•J7/ M! I' V ••�• 11)DI• 6)' Y 1 • 11 •(q' ti 1 'JD 1) Di 4),.wQkj � it)• WHEREAS, the Fridley housing & Redevelcpent Authority has employees rendering valuable services; and WHEREAS, the establishment of a deferred oompensaticn plan for such employees serves the interests of the Employer by enabling it to provide reasonable retirement security for its employees, by providing increased flexibility in its personnel mane , gem�mt systestm and by assisting in the attraction and retention of competent personnel; and WHEREAS, the Employer has deternmined that the establishment of a deferred compensation plan to be achniumistertaci by the ICMA Retirement Corporation serves the above objectives; and WHEREAS, the Employer desires that its deferred compensation plan be by the ICNA. Ret=mient Corporation, and that the funds held under such plan be invested in the ICMA Retirement Trust, a trust established by public employers for the collective investment of funds held under their retirement and deferred compensation plans; NOW THMUMIRE BE IT RESOLVED that the Employer hereby adopts the deferred compensation Plan (the "Plan ") in the form Of: The ICMA Retirement Corporation Deferred Ccmpensation Plan, and BE IT FURS RESOLVED that the Employer hereby executes the Declaration of Trust of the ICMA. Retirement Trust, and BE IT FURTHER RESOLVED that the Finance Director shall be the coordinator for this program; shall receive necessary reports, notices, etc. from the ICMA Retirement Corporation or the ICMN Retirement Trust; shall cast, on behalf of the Employer; any required votes under the ICMIL Retirement Trust; may delegate any a, kmni.strative duties relating to the Plan to aRpr* pr ate depar netts; and is authorized to execute all necessary agreements with ICMA Retirement Corporation incidental to the administration of the Plan. PASSED AND ADOPTED BY THE FRS>~.v HOLISM & AMEX= T= DAY OF , 1993. l ti pi 'M Mt. IDi'+. M h 1•J �• t 19 . 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O1Df- (,N fl- N f-1-P- NFNPI�I�P- J Q r 0 lWh Q 7.1 TO: FRIDLEY H.RA FROM: CITY OF FRIDLEY RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES MAY 1993 :................... ............................... ................... ............................... ADMINISTRATIVE BILLING: ADMINISTRATIVE PERSONAL SERVICES ADMINISTRATIVE OVERHEAD TOTAL ADMINISTRATIVE BILLING : OPERATING EXPENSES: MIRCOWAREHOUSE — WP 5.1 & DIRECT ACCESS POSTAGE BY PHONE — POSTAGE CITY OF FRIDLEY — PETTY CASH CITY OF FRIDLEY — MINNEGASCO & EMBOSSER CITY OF FRIDLEY — NSP TOTAL OPERATING EXPENSES: TOTAL EXPENDITURES — MAY 1993 File :1123DATA \HRA \MF193BILLwM Account #'s for HRA's Use 7.2 .s Account #'s for City's Use 13.842.00 101 - 0000 - 341 -1200 250.00 101 - 0000 -336 -3000 460-0000-430-4330 14.092.00 361.22 236 -0000- 336 -3000 28.72 236- 0000 -336 -3000 11.53 236- 0000 -336 -3000 21.67 236- 0000 - 208 -3000 7.03 236- 0000 -208 -3000 430.17 TO: FRIDLEY H.RA FROM: CITY OF FRIDLEY RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES JUN 1993 ADMINISTRATIVE BILLING: ADMINISTRATIVE PERSONAL SERVICES ADMINISTRATIVE OVERHEAD TOTAL ADMINISTRATIVE BILLING: OPERATING EXPENSES: NYSTROM PUBLISHING - SUMMER NEWSLETTER TOTAL OPERATING EXPENSES: TOTAL EXPENDITURES - JUN 1993 File: \123DAT*HRA\T1F1938lLL.wM Account #'s for HRA's Use 7.3 Account #'s for City's Use 13,842.00 101 - 0000 - 341 -1200 250.00 101 - 0000 - 336 -3000 460-0000-430-4330 14.092.00 460 -0000- 430 -4335 1031.00 236- 0000 - 336 -3000 1.031.00 .- wlIn I 0 O I O W a E6 a o� I °C I li In tee, W OC IW- U' °a h a_ o 9 6 W OC J W GI �I d 1-- rW+ Wli Z I mw go dias 1 w 1 10 O I s ui 1 M J�u d '°e ne 1 U,p� a a Z I \ �b GN qq2 Z�Ntt ~NYN£ J C7 O . wZ� � 3 �iz�olimoo GM01"4000;c00000 �VN�05_8M1�00 O.— N O —9 880088888888 COGOORNONN00 1 1 1 1 1 1 1 1 M§8888888 00 00 00 O c NNNNti$$Noti M M M M M M M M M M M pl, 91, kell ekkkckell b b b b b b b b b b m In 0 � N O � W I <- O � O�O�^ S <a6~6 G7 m m N N G 7.4 — M CO . 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In 1991, the HRA adopted a gradual "phase -out policy ". Since the HRA bought the building in 1990, the number of tenants has decreased from eight (full occupancy) to four. At the end of 1991, revenues exceeded expenditures by $47,000. In 1992, revenues dropped to $8,888, because three major tenants left (Norge Village, Metz Bakery, and Rapit Printing). The 1993 projected balance is a deficit of $8,130. Current Status A number of issues .*are important for the HRA's decision: 1. Four out-of the eight rental bays are occupied. Two of the four tenants have recently indicated a desire to leave by September 1, 1993. Arland Breyer, President of Cinnamon Skin Tans, will be present at the HRA meeting to discuss breaking the lease with the HRA.to occupy another building in Fridley. My Sister's Closet /Bargains, Bargains is also seeking new tenant space and has indicated verbally that they would like to vacate the building by September 1, 1993. 2. Cinnamon Skin Tans has a lease through December 31, 1993, and My Sister's Closet is on a month to month lease. If Cinnamon Skin Tans is permitted to leave for September 1, 1993, the operating deficit for Rice Plaza would be $14,090. 8.2 Discuss Status of Rice Plaza July 1, 1993 Page 2 Staff had advised Mr. Breyer that we would not consider a September 1 vacancy date, although we would consider a November 1 vacancy date in order to. minimize our losses. My Sister's Closet is on a month to month lease and can vacate with 30 days' notice. The operating deficit for an 11/1 vacancy would be $12,530. Again, if all tenants remain in the building, our original project of a deficit of $8,000 appears to be on target. 3. The Hong Kong Kitchen lease expires at the end of October 1993. After this point in time, all leases, except Cinnamon Skin Tans, are on a month to month lease and the HRA could give a 30 day notice to vacate. 4. The filing deadline to request the County to have the property become tax exempt is July 1. Therefore, if the building is demolished at the end of 1993 or in 1994, the HRA is still responsible for the 1994 taxes (1993 taxes are $30,574). 5. In March of 1992, Darrel Clark obtained a demolition estimate of about $25,000 to remove the building. We believe that number is still accurate. 6. The HRA's carrying cost for the property would amount to the taxes, plus the cost to plow the parking lot during the winter to provide access to the Dairy Queen and to mow the lawn to the rear of the parcel. Approximate maintenance costs are $2,000. Again, after 1994, the carrying costs would simply be the mowing and plowing, because we would obtain tax exemption for the parcel. 7. It should also be remembered that the calculations for the operating revenues and expenditures for Rice Plaza do not contain any type of amortization for the original acquisition price of $1 million. The property tax is the largest expense for the building. This year will be the first year that the revenues from the tenants will not be able to retire all of the costs necessary to keep the property at a break -even point. 8. If Cinnamon Skin Tans and My Sister's Closet vacate, staff recommends that the HRA not proceed with the driveway improvement to the rear of the building. We 8.3 Discuss Status of Rice Plaza July 1, 1993 Page 3 had recommended this improvement at the May meeting because of the conflict between the drive- through traffic and the tenant traffic in front of the building. This would be a savings of about $4,000 - 5,000. If only two tenants remain in the building this fall, the traffic conflicts are minimal. Recommendation At this point in time, no direct discussion with any of the tenants has occurred regarding demolition and relocation of the tenants. Despite the outcome of Cinnamon Skin Tans, by January 1, 1994, it is very likely that only two tenants will remain in the building. Staff recommends the following: 1. The property manager, Jim Kordiak, should be directed to contact all the tenants about the HRA's intent to demolish the building in January 1994. The tenants should be interviewed as to their business plans and ability to relocate to another location. The tenants should be told that they must relocate no .later than February 1, 1994. If there are any problems from any of the tenants, there is sufficient time to deal with these .problems before the anticipated demolition date. 2. The HRA should direct staff to withhold the driveway improvements to the rear of the Rice Plaza building. 3. After all tenants have vacated the building, staff should be directed to take bids for demolition of the building. 4. After demolition is completed, staff should be directed to file the necessary applications to request tax exemption on the property. BD:ls M -93 -389 8.4 June 2321993 City of Fridley HRA Fridley, Minnesota 55432 RE: 248 Mississippi Street Cinnamin Skins/T's Hair Plus at 248 Mississippi Street would like to terminate our lease effective September 1, 1993. We have an opportunity to relocate in Fridley where we will. be able to keep our business afloat. Due to this years road construction and the decrease in parking availability including the Dairy Queen drive thru, our business revenue had dropped approximately 45 %. We feel the current location has poor HVAC and is in dire need of renovating which would cost a considerable amount of money to do. We have also heard rumors to the effect that the building will be demolished in the spring of 1994 which will leave us without a place of business. We would appreciate if you would expedite a response to this request. If you have any questions, please feel free to contact me at 631 -2581. Sincerely, Arland F. Breyer, Pres dent LA Ventures, Inc dba Cinnamin Skins/T's Hair Plus w. 1. 2. 3. 4. 5. 6. es f P-0µ J(?73 1993 RICE PLAZA ANALYSISC7V ' "Gradual Phase -Out" option selected September 1992. Projected balance for 1992 was $9,598.00 based on five out of eight bays rented 1992 actual balance is: $46,612.50 Rent payments - 29,119.37 Taxes 4,605.49 Maintenance /Management fees 4.000.00 Insurance $ 8,887.64 1993 projected balance is: $31,044.00 Rent payments 4,600.00 Maintenance 4,000.00 Insurance 30,574.00 Taxes ($8,130.00) Hong Kong Kitchen lease expires October 31,.1993. Cinnamon Skin Tan lease (under new ownership) expires December 31, 1993. w 8.6 HOUSING & REDEVELOPMENT AUTHORITY MTG. , SEPT. 10 1992. PAGE 5 MOTION by Mr. Prairie, seconded by Mr. Meyer, to approve check registers dated August 6 and September 10, 1992, as presented. UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 5. REVISED PARKING LEASE BETWEEN HRA AND COLUMBIA PARK PROPERTIES: Ms. Dacy stated that Jim Hoeft wanted the HRA to know that he and the attorney for Columbia Park Properties are still working on a revised parking lease. There have been a number of leases and documents pertaining to this property, so the intent is to combine everything into one document. When the document is completed, it will be signed by the Chairperson and .Executive direct6r. H.06. RICE PLAZA UPDATE: Ms. Dacy stated that when staff and the HRA.were reviewing the 1992 budget, they looked at Rice Plaza and the income •iersus. the expenditures. At that time., there-were only three vacant spaces out of eight rental spaces. At the*end of 1991, balance of. revenues minus expenditures equalled an excess of about $47,000. Ms. Dacy stated that last year the HRA discussed-three options: 1. Existing status,- with tenant improvements (about $15, 000) 2. Demolishing the building in March 1992 3. Gradual phase -out Ms. Dacy stated the option chosen at that time was option #3. About $2,500 was allocated -in the budget for -a trash enclosure and sign improvements. Ms. Dacy stated that a number of tenants have now left the building. The most recent tenant, Rapit Printing, will Le vacating effective October 1, 1992, and will be moving to the old Zantigo building on University Avenue. Ms. Dacy .stated that five-out of eight rental spaces are now vacant. One of the remaining three tenants, Hong Kong Kitchen,. is on a lease until October 1993. The other two tenants, Cinnamon Skin Tan and Bargains, Bargains•are on a-month -to -month basis.. Ms. Dacy stated that as compared to the 1991 balance o. revenues minus expenditures of $47,000, projecting the revenues -Dut•to the end of 1992 minus the expenditures, they will have positive balance of about $9,600. However, with only three spact --s rented, 8.7 HOUSING & REDEVELOPMENT AUTHORITY MTG. SEPT. 10 1992 PAGE 6 by the end of 1993, the revenues minus expenditures will be a negative $16,900. Ms. Dacy outlined the costs of comparing the three options (option #1•- Current tenants with improvement; option #2 - Demolish 1993; option #3 - Gradual phase -out. Based on Mr. Kordiak's opinion that he cannot.re -lease any space without improving the appearance of the building and the HRA's discussion -last year, option #1 really isn't an option. That leaves options #2 and #3. If the HRA decides to demolish the building, they would probably have to break Hong Kong Kitchen's lease. -.and have to pay relocation expenses. Demolishing the building will cost about $25,000 plus the normal operating expenses.plus taxes,.so it will cost about $1.00,000 to demolish the building.. She stated •that with gradual phase -out option, while they don't have the demolition expense, they begin to lose money because of lack of tenants. Ms. Dacy stated staff is recommending that the HRA not take any action on -the building until the end of 1992 and see if any of the tenants. can be relocated in the Fridley Town Square development. More information on that development should be forthcoming in the next one to -two months. If the tenants do not.relocate•to Fridley Town Square, staff recommends the HRA''strongly consider demolishing the building in 1993. A potential time would be to do it in con- junction with the Mississippi Street improvement project by Anoka County next spring.- = -,- . ° Mr. Burns suggested the HRA wait to see what happens. If. Hong Kong Kitchen does not break its lease, them maybe the . s ould wai to demolish the building .until October 1993 when the Hong Kong Kitchen lease expires. That way the HRA would not have to pay relocation expenses. Ms. Schnabel stated staff's analysis appears to be .would agree wi th r s, a e ETV7—wait ETV —wait on current enants;.Vith the Fridley Town Square ciev current tenants. Mr. Meyer and Mr. Prairie agreed. 7. REQUEST-BY TIM WERNER REGARDING LAKE POINTE SITE: sound. She — acisions to Ms. Dacy stated Mr. Werner is running against Alice Johnson for State Representative: Because Mr. Werner believes the metro area should better pursue bus service, he has inquired as to whether. or not the HRA would be willing to establish a park -and -ride site at the immediate intersection of Highway 65 and West Moore Lake Drive (where the bank, hotel, and restaurant buildings are proposed in the original.Lake Pointe plan). Mr. Werner has been calling her weekly regarding this issue. She stated she has told Mr. Werner that the HRA is looking at a lot of options for the Lake Pointe site. o2c IS 00 ooG d .J i FRIDLEY HRA 6431 UNIV AVE NE FRIDLEY, MN 55432 Edaad M. TMA& avow Property Reawds and Tmam ANOKA COUMY ado 3W Awew. IN 1993 Amia MN susw amsamo PROPERTY DESCRIPTION SYLVAN HILLS PLAT 7 LOT 1 BLOCK 1 i� lac I �azGl Property Class- Now improvement - Market Value: I. Use this amount on Form MAPR to see N 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 Forrt M -1 PR . YOUR PROPERTY TAX And How tf is Reduced B The State 3. Your property tax before reduction by state pata aic s and crec Its. . .. . 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 • . . . . -77-7-77-7= . . . . . . . 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.S .. . . pedal assessments added to this tax bill . . . _ _ _ 14.Your total property tax and special assessments . IS.Pay this amount no later than May 15, 1993 .. . 16.Pay this amount no later than October 15, 1993 . . . . .. . . . COMM -IND COMM71ND N/A 0 579600 579600 8.8 PAP 0 0.00 0.00 0.00 0.00 51678.80 53252.18 M<- 22559.43 22677.60 0.00 0.00 0.00 29119 37 0.00 - 3037 8 0.00 0.00 0.00 0.00 21162.35 7957.02 29119.37 29119.37 PLEASE WCLUDE PIN NUMBER ON CHECK PLEASE INCL -1! PIN NUMBER ON p1Ep( Pw R14 30 24 32 nnsA as Pmt PAY THIS AMOUNT 15287.29 FRIDLEY HRA 6431 UNIV AVE NE FRIDLEY, MN 55432 005381902001528729 PAY THIS AMOUNT FRIDLEY MRA 6431 UNIV' AVE NE FRIDLEY, MN 55432 0.00 0.00 0.00 0.00 20310.38 9654.29 60q.g1<- 30574.58 0.00 30574.58 15287.29 15287.29 15287.29 005381901001528729 00538190F003057458 - --- ------ - - - - - -- --- ------ --- ---- ---- - - ANOKA COUNTY PAYABLE 1993 STATE PAID PROPERTY TAX REFUND INFORMATION Market 1992 1993 Owner. FRIDLEY HRA M - ar ket Value: R14 30 24 32 0058 06431 UNIVERSITY AVE NE M 579600 579600 FRIDLEY, MN 55432 New Construction Value: N/A 0 Property class: Taxpayer. COMM -IND COMM -IND FRIDLEY HRA 6431 UNIV AVE NE FRIDLEY MN 55432 L air 1 Amount to use in faGng out your property tax refurxt form M -1 PR, if eligible .......... ............................... Line 2 Amount to use in riUing out scbedute 1 of form M -1 PAd efu7ble ........ 0.00 0.00 If this box Is checked, you owe delinquent taxes . . . .. .. . Detadrdds stub and htdadettwtthyaw ; .;•o < "- :::.:...::x.:a.+ ;:a> s ri>s:;,.:::: ':..z.: " >.<x "sip.: ". <z.:... ". �,,. „:::::... ----------- - - - - P l E�tTY TAiQfiE'ittO1 MA$;Ot°�A�!I A1iil�2'"�84� oYm when a- a - - ----------------------- PIN: 1993 MKT/VAL PAY 1994 579,600 R14 30 24 32 0058 City: FRIDLEY LOCAL BOARD OF REVIEW Property Class. COMM -IND FRIDLEY CIVIC CENTER COUNTY ASSESSOR 323 5479 06431E UNIVERSITY AVE NE APRIL 05,1993 AT 7:30 PM COUNTY BD. OF EQUALIZATION FRIDLEY, TO APPEAR CALL LOCAL ASSR. ANOKA COUNTY GOV. CENTER MN 55432 AT 571 3450 JUNE 17,1993 AT 9:00 AM T1V017A1- -- 7700aa0T �i I I- Z W Q vii O) a U pq 6 tV W N N N O O LO N EA m L 'Q Y O O m c as ti m m L 'O .a L 3 N r L a+ O N L m LL c O_ N m CL X m N N N C m L U C Y C O I 9 N_ N m Q m m N t6 m C C Y co C O N C r C m (U cl I Y 3 a a eo rn F m 8.9 r _ 9.1 Community Development Department PLANNING DIVISION City of Fridley DATE: June 21, 1993 TO: William Burns, City Manager 4A FROM: ✓ Barbara Dacy, Community Development Director SUBJECT: Interested Party at Lake Pointe Site John Ryden from CB Commercial contacted me on Wednesday, June 16, 1993 about an interest from Multi Tech Systems to relocate its headquarters from the Moundsview Business Park to approximately ten acres of the Lake Pointe site. Multi Tech would build a one story, 70,000 square foot building with a portion of it as a two story office complex. Multi' Tech Systems manufactures modems. Ryden advised that there could be a potential of a 30,000 square foot expansion for a total of 100,000 square feet. Although Ryden couldn't confirm the exact number of employees, Multi Tech Systems probably employs anywhere between* 50 - 100 employees. Multi Tech is looking for a high -tech image site rather than the typical manufacturing /warehouse industrial park appearance. I advised Ryden of the HRA and City Council discussion in May. I told him that I thought that this proposal is not consistent with the vision that the HRA and City Council have for the property; however, I would advise them of this interest in the case that I may be mistaken. Let me know if you need further information. BD /dn M -93 -358 9.2 1. Bill Tobin, the consultant, began the meeting. by asking each participant what his /her expectations were for the meeting. In general, the participants agreed that they expected the meeting to identify acceptable uses for Lake Pointe and to arrive at some conclusions as to how we can accomplish those uses and create goals related to those uses. 2. HRA Chairperson Larry Commers indicated he expected the meeting to produce a plan and a strategy for the implementation of a plan. 3. Mayor Nee indicated that he wanted us to confirm or modify our broad goal for the property. In other words, he wants us to review and reach consensus on development choices. 4. Councilmember Dennis Schneider said that he believes that market forces will determine what we do. He wants to see if what is out in the market is acceptable. He wants us to be able to respond to opportunities that arise in the market place. 5. Councilmember Nancy Jorgenson said that she does not want to see a K Mart or Menard's development in that area. She wants quality development that remains consistent with what we told the neighborhood. She likes the hotel /conference center approach and wants us to focus on the north metro area as a market place. 6. HRA member Virginia Schnabel said she would like to leave the meeting with a plan of development. She thinks we should be open to looking at different alternatives other than those included in the original vision of the property. 7. Councilmember Steve Billings said that he had no preconceived notion or expectation about the meeting. He said that he is concerned as a council member who inherited the site as it is in his ward. He pointed out that if we come up with a plan different from the original idea, he will need to .discuss it with the neighborhood. 8. HRA member Duane Prairie said that he sees us sharing information at the meeting and updating and finding out what is available in the marketplace today. He said that our original goals were very high; however, he does not want to lower the goals too much. 9. HRA member John Meyer said he wants Bill Tobin to tell us what is marketable for the site. 9.3 10. We then discussed background data on the site. I presented information on the land area and various land use actions that had occurred, including zoning and planning actions. I also talked about utility locations and planned intersection improvements. In addition, I addressed the extent to which the City's comprehensive plan and the modified development plan had bearing on the Lake Pointe site. 11. Barbara Dacy presented her material outlining the carrying costs for the Lake Point site. There was considerable discussion regarding the carrying costs for the site. 12. Councilmember Nancy Jorgenson said she wants the costs laid out in a cash flow format. She would like to see in detail what we are paying for each year. 13. Bill Tobin then led a discussion of what was expected for the site and what the goals were. 14. Bill Tobin said that today's real estate market is dead. He said that the banking and investment community offer. limited opportunities. Credit is starting to loosen up in some areas. He said that there is not a lot of sales activity, and buildings that are selling are selling at dramatic discounts that are below replacement costs. 15. Bill Tobin then described the Northwest Business Campus at the intersection of Highway 55 and 1-494. He said it was a combined North Memorial /Abbott Northwestern project offering core medical services and supporting medical services. The site sold for $3 per foot, and the acreage is 38 acres which is similar to the Lake Pointe site. He said that the plan density is around 750,000 square feet, which is similar to our proposed density for the Lake Pointe site. 16. He said that gambling and medical are the two segments of the economy that seem to be alive right now. Medical, however, is on hold until it is known what the Clinton administration is going to' do with health insurance and the health care industry. 17. He indicated that the Northwest Business Campus is owned by Prudential and is being marketed by a broker. The broker, however, did not find Abbott Northwestern. Abbott simply walked in and bought it. 18. We then went into a discussion on the strengths and weaknesses of the Lake Pointe site. Among the strengths identified were transportation, highway access, location, visibility, Fridley schools, presence of a large number of headquarters /companies in Fridley, low taxes and utility rates, and employment base. 2 9.4 19. The weaknesses identified for the site were the perception of the area and the metropolitan area as a whole. It was also pointed out that this is a poorer multi- tenant market and the site offers poor proximity to the airport. 20. With respect to specific objectives for the site, Councilmember Nancy Jorgenson said that the most important thing for her is that she wants to change the perception of the north metro area. 21. With respect to financial objectives, Councilmember Nancy Jorgenson said that we should break even on the site. 22. HRA Chairperson Larry Commers said he would like to develop the site as a corporate headquarters site, and long-term, he would like to break even, at least by the time tax increment district has expired. He said he is not concerned about maximizing the density on the site, as long as it gets the quality of development he would like to see. 23. With respect to timing, Councilmember Nancy Jorgenson said she would like to see something done in two years. HRA member John Meyer said that was unrealistic. HRA member Duane Prairie said we need a five -year plan. Mayor Nee said he would like to see 25 percent of the land used in five years (that means about 10 acres). Councilmember Dennis Schneider indicated a strong preference for having Medtronic develop the property. 24. HRA member Virginia Schnabel said we need to develop a strategy for selling the site- -under what circumstances and with whom will the cost be written down, and how much of the cost will be written down for different users. 25. HRA member John Meyer said that we should sweeten the pot to get Medtronic to develop the land. 26. Councilmember Steve Billings said that we need to think beyond Medtronic. 27. Councilmember Nancy Jorgenson suggested putting together a marketing piece including a video for the site. 28. Councilmember Steve Billings said that if we want to break even, we need to get two to three 100,000 square foot buildings in the near future. 29. Councilmembers Steve Billings and Dennis Schneider indicated a willingness to give away large parcels of land for a commitment to a 100,000 square foot building now. 3 9.5 30. HRA Chairperson Lary Commers indicated that he does not like the location and site of the Wedgewood Business Center. He said it is one - story project that is spread out on the site. He said he would like to hold out for a "signature« type of deal. (By that I assume he means the corporate headquarter's type of deal. 31. HRA member Virginia Schnabel said she thinks we should share our focus with people. 32. Bill Tobin indicated that he thinks we should dress up the intersection. The entrance to the property also needs to be upgraded. He also thinks we should renew the MPCA permit and if possible, get natural gas to the site. 33. The group agreed that they do not like the one -story, high tech manufacturing buildings. They said they are willing to hold out two to five years in order to get our ideal. 34. HRA Chairperson Larry Commers wants us to revise our cash flow analysis for the HRA and factor in costs of intersection improvements. 35. Councilmember Dennis Schneider suggested separating the intersection improvements that need to be. done to improve the marketability of the site from those that are necessary for traffic congestion and the mediation 'of air pollution. 36. The group agreed that they want us to do the type of things now to get the site ready for use, such as the natural gas hook up, modified intersection improvements, acquisition of the two properties, and acquisition of MPCA indirect source permits. 37. Bill .Tobin thinks that we should send a marketing brochure and letter to ten to twelve companies. He said we should help plant the seed for future building. He said they probably will not build now, but by contacting them and advertising with them at this point, we will plant the seed that the site is available when they are ready to build. He said that we should do some further exploration of the medical campus concept. 38. Mayor Nee suggested that we send a promotional piece to brokers and pursue an open listing of the property. 39. Bill Tobin said we need a single market brochure with different cover letters written to appeal to the different industrial targets. 40. He said that with respect to brokers, we could do it on a very personal basis and invite five or so brokers to breakfast every month. 4 9.6 41. Councilmember Nancy Jorgenson said that she wants us to address Duane Flatten's problems on the east side Highway 65 intersection. She said she thinks Flatten wants out of the agreement with the City. He does not want to keep up the property as he had agreed to. She thinks at the very least, we should clean it up and spray for weeds. 42. Councilmember Steve Billings thinks we need signs on the property. He would like a big 16' x 16' sign in the middle, and a 4'x 8' sign at the entrance, letting people know that the property is a development site and not a park. 43. We ended the meeting by summarizing our conclusions: A. We should not be ready to abandon the corporate headquarters vision for the Lake Pointe site. The idea of having one -story, high tech manufacturing campus similar to the Northwest Business Campus was rejected at this point in time. We have been asked to prepare a marketing brochure and letters B. Shat would be directed toward the twenty -five major corporations in Minnesota, or at least a very large .number of corporations in Minnesota that have been identified by standard industrial code. C. We have been asked to send a letter and a brochure to area real estate brokers and to pursue an open listing approach to marketing the property. D. We have been asked to do a number of things that will help us get the property ready for immediate use. E. They suggested that we at least look into acquiring the two option properties on the north side of West Moore Lake Drive. The group also suggested that we renew the MPCA permit. F. They suggested that we have Minnegasco hook up the site to natural gas. G. It has been suggested that we investigate the possibility of doing some of the intersection improvements and that we create some sort of a monument at the entrance to the site to make it more noticeable. h H. It has been suggested that we put some signs out on the property itself that are visible from the highway. I. We need to conduct some more specific research on the medical sector. 5 9.7 44. Before the meeting ended, we briefly discussed the compromise arrangement reached with Don Fitch for the acquisition of the Dairy Queen site with respect to the development of the 10,000 Auto Parts site. Everyone agreed that we should give Mr. Fitch an additional $35,000 for the Dairy Queen site. It was also recognized that Mr. Fitch's $200,000 would become part of the investment in the development of the 10,000 Auto Parts site. Mr. Fitch has agreed to ask for no relocation costs and no additional interest on the amount that has already been awarded. He has also agreed that the $35,000 additional stipend will be included as part of the City's equity in the Fridley Town Square project and that a total of $335,000 will be used in applying to the future equity participation agreement. 45. The meeting ended at approximately 12:30 p.m. 46. The following individuals attended the meeting: Mayor William Nee, Councilmember -at -Large Nancy J. Jorgenson, Councilmember Steve Billings, Councilmember Dennis Schneider, HRA Chairperson Larry Commers, HRA member Virginia Schnabel, HRA member John Meyer, HRA member Duane Prairie, and HRA member Jim McFarland, Barbara Dacy and William Burns (staff), Jim Casserly and Bill Tobin (consultants). LV r� 10.1 Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 1, 1993 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Status on All Temp Expansion Project At the April 8, 1993, meeting, the Executive Director presented a request by All Temp for tax increment financing assistance for expansion of the existing All Temp facility at 5400 Main Street. All Temp is awaiting a final decision from a potential tenant for freezer space within the existing building. If the tenant agrees to occupy the facility, All Temp intends to expand the building 60,000 - 70,000 -square feet for additional space for another potential tenant. Mr. John .Holman from All Temp contacted Jim Casserly this week and notified him that he is still awaiting a decision from potential. tenants. The necessary legislation to initiate a tax increment district may be presented at the August 1993 meeting. No action is- needed on this item at this time. BD:ls M -93 -386 r \ N oho G Q. 10.2 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 project. The project can legally be funded through TIF and an Economic Development Tax Increment District could be created. If they .B A 10.3 HOUSING & REDEVELOPMENT AUTHORITY MEETING APRIL 8 1993 PAGE 1 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, Lavonn Cooper Recording Secret a° 0 Community Development Department PLANNING DIVISION City of Fridley DATE: July 1, 1993 TO: William Burns, City Manager A FROM: i/Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Reuse of Property at 5720 Polk Street N.E. ACCAP has notified us that they would not be interested in rehabilitating the existing structure and relocating it on the property. The cost to accomplish this option is too excessive. We are therefore recommending that the City proceed to demolish the _existing structure. Demolition costs will be reimbursed by MSAS monies. Grant Fernelius and I have discussed two options regarding reuse of the property: 1. ACCAP's typical policy is to request cities to donate the property for construction of a new home. ACCAP has indicated that a house on this particular lot would be valued between $65,000 - $80,000. ACCAP has indicated a willingness to buy the property from the City at 50% of its market value which is consistent with ACCAP's policy of purchasing tax forfeit lots from Anoka County. If ACCAP were to purchase the property, the City would probably receive $12,300 since the land value on the property is $24,600. ACCAP would then construct a home on the property in the immediate future. They have also indicated a willingness to work with the City on screening from Moore Lake Apartments as well as details about the type of structure. ACCAP notes that despite the value on the home, it would still meet the first time home buyer or affordable housing objective. 2. The second option is based on a scattered -site development model by the City of Richfield. We would package this vacant lot plus the vacant lot at Broad Avenue and Lafayette Street, and possibly two or three other lots scattered in the community and negotiate with a builder to purchase the lots and construct homes on the properties. The type of home and Reuse of Property at 5720 Polk Street N.E. July 1, 1993 Page 2 value could be specified with the builder and a mutually beneficial purchase price could be negotiated. The sales from the four or five lots, potentially $20, 000 each or $100,000 total, could be coupled with the $100,000 scattered -site acquisition budget from the HRA and could be used to purchase blighted properties within neighborhoods. The Community Development Department is currently compiling a list of "blighted properties" which would be eligible for this type of acquisition. An example of a property would be the Erickson property on Ely Street. While this option is very appealing, the City Council should be aware that it will take six to eight months to develop this program given our other program priorities for the single family rehabilitation, multiple family rehabilitation, and rental licensing projects. Also, we have not solicited any type of interest from the building community, so we do not know if the Richfield model would work in the City of Fridley. Meanwhile, the City would continue to be responsible- mar maintaining the vacant lot at 5720 Polk Street N.E. Recommendation Staff recommends that the City Council authorize us to pursue Option #2 to develop a scattered -site lot sale program in order to generate funds to eliminate blighted properties. Further, staff will proceed to have the Branco home demolished the week of July 7, 1993. BD /dn M -93 -384 HOUSING AND REDEVELOPMENT AUTHORITY MEETING THURSDAY, JULY 8, 1993 7 :30 P.M. PUBLIC COPY NNW A CITY OF FRIDLEY A G E N D A HOUSING & REDEVELOPMENT AUTHORITY MEETING THURSDAY, JULY 8, 1993, 7:30 P.M. Location: Council Chambers Fridley Municipal Center CALL TO ORDER ROLL CALL APPROVAL OF MINUTES: May 20, 1993 ACTION ITEMS: MEMO ON REQUEST FOR ASSISTANCE 1. 1-1.13 FOR SPORTS SPREE IN MOORE LAKE COMMONS CONSIDER RESOLUTION REGARDING 2.1-2. 16 HOME IMPROVEMENT LOAN PROGRAM CONSIDER RESOLUTION REGARDING 3. 1-3.8 HOME MORTGAGE ASSISTANCE PROGRAM CONSIDER RESOLUTION REGARDING 4.1-4.16 RENTAL REHABILITATION LOAN PROGRAM CONSIDER RESOLUTION REGARDING CONTRACT 5. 1-5.09 INSPECTORS FOR HOUSING REHABILITATION PROGRAMS RESOLUTION ADOPTING ICMA RETIREMENT CORPORATION AS THE DEFERRED COMPENSATION PLAN PROVIDER FOR THE 6. 1 FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY 7. 1-7 .5 CLAIMS AND EXPENSES INFORMATION ITEMS: 8. 1-8.9 DISCUSS STATUS OF RICE PLAZA MEMO ON MULTI-TECH SYSTEMS 9.1-9.7 INTEREST IN LAKE POINTE SITE MEMO ON STATUS OF ALL TEMP EXPANSION PROJECT 10.1-10.3 OTHER BUSINESS ADJOURNMENT 01MIIMI , i W -.-.-... -.-, .c.:.x. .... - z; �z•.•xiisxr1WSz..zv:•: - z.:c.. ate,..,.,. •----___ , CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 20, 1993 CALL TO ORDER: MOTION by Mr. Prairie, seconded by Mr. McFarland, to nominate John Meyer as the Acting Chairperson for the meeting. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. Acting Chairperson Meyer called the May 20, 1993, Housing & Redevelopment Authority minutes to order at 7:30 p.m. ROLL CALL: Members Present: John Meyer, Duane Prairie, Jim McFarland Members Absent: Larry Commers, Virginia Schnabel Others Present: William Burns, Executive Director of HRA Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator Rick Pribyl, Finance Director Craig Ellestad, Accountant Jim Casserly, Consultant Jerome Meyers, Sheet Metal Connectors APPROVAL OF APRIL 8, 1993 , HOUSING & REDEVELOPMENT AUTHORITY MINUTES: MOTION by Mr. McFarland, seconded by Mr. Prairie, to approve the April 8, 1993 , Housing & Redevelopment Authority minutes as written. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 1. CONSIDER SUBORDINATION AGREEMENT FOR SHEET METAL CONNECTORS: Ms. Dacy stated that Sheet Metal Connectors is about to complete the SBA loan process for permanent financing of its new building on Main Street. She stated that presented for HRA action are two agreements. One agreement is between the HRA and Northeast State Bank which will have the primary mortgage. The second agreement is between the Coon Rapids Development Company which processes the SBA 504 loan and the HRA. The SBA loan will have a second position. �.'�,,,-••,�rv'�b',u`i1a n e ec a naar........v.w 1iii1Sri14tlOi5�i1i2iW; HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 20, 1993 - PAGE 2 Ms. Dacy stated that Jim Casserly has reviewed the documents and advised that they are in proper form and in compliance with the development agreement. MOTION by Mr. Prairie, seconded by Mr. McFarland, to approve the Subordination Agreements and authorize execution by the HRA=Chair- person and Executive Director. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 2. CONSIDER RESOLUTION TO AUTHORIZE PARTICIPATION IN MHFA MINNESOTA CITY PARTICIPATION PROGRAM: Mr. Fernelius stated that the First Time Homebuyer Mortgage application was prepared the week of April 12, 1993, in order to meet the April 15, 1993, deadline. The application requested $2,249,999 in mortgage revenue bond allocation for the City of Fridley. At the May 11, 1993, meeting, Fridley was allocated $1, 161, 000. He recommended that the HRA approve the resolution authorizing participation in the MHFA Minnesota City Participation Program and approve the application. Mr. Prairie asked if one-half of the request is the typical amount that is awarded to a community. Mr. Fernelius stated that MHFA has an allocation formula based on a variety of minimum floor scenarios. He stated that $73 million were requested, and the pool available was only $47 million. Mr. Meyer stated that in the future, he would like to know more specifics about the allocation process and how final amounts are determined. MOTION by Mr. McFarland, seconded by Mr. Prairie, to approve the application to the MHFA Minnesota City Participation Program and to approve Resolution No. HRA 1 - 1993, Resolution Authorizing Participation in the MHFA Minnesota City Participation Program. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 3. CONSIDERATION OF ADDITIONAL IMPROVEMENTS IN COOPERATION WITH MISSISSIPPI STREET IMPROVEMENT PROJECT: Ms. Dacy stated that there were three parts to this item. The first part deals with the traffic flow on the Rice Plaza property. Ms. Dacy showed a video depicting how the parking would function after the additional right-of-way has been removed from the front of Rice Plaza. She stated that a driveway needs to be constructed to the rear of Rice Plaza and the parking lot striped in accordance 4 HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 20, 1993 - PAGE 3 with the site plan shown on page 3.5. She stated the estimated cost of the additional driveway work and striping would be about $5, 000. She stated there is an adequate surplus in the Mississippi Street improvement project budget to accommodate this expenditure. Ms. Dacy stated that the tenants are concerned about the: drive- through traffic for the Dairy Queen passing in front of the Rice Plaza building. She stated that in order to provide for safe traffic movements, the improvements are necessary. MOTION by Mr. McFarland, seconded by Mr. Prairie, to authorize staff to execute the necessary documents to complete the improvement as shown on the plan in the agenda packet. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. Ms. Dacy stated that the second part of this item is the landscaping replacement at the Target and Holly Center sites. She stated the vegetation at the Holly Center site would not have to be replaced. She stated that because of that, the requested amount of money to replace vegetation in the project has been reduced to about $6,000. Ms. Dacy showed a video identifying six evergreen trees, a variety of shrubs, and five Crabapple trees that need to be removed. She stated that the row of Winged Euonymous along the trash enclosure on Mississippi Street will be transplanted to the front part of the Target site instead of being replaced. MOTION by Mr. Prairie, seconded by Mr. McFarland, to authorize staff to execute contracts to transplant or replace vegetation as necessary at a cost not to exceed $6,000. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. Ms. Dacy stated that the third part of this item was the corridor landscaping improvements at the intersection. She stated that as part of the University Avenue corridor improvement plans completed in the mid-1980's, landscaping was proposed at every intersection along University Avenue. During the Mississippi Street project review in 1991, Anoka County indicated that the HRA should be responsible for the installation. She stated that it is cheaper for the HRA to bid and to install the landscaping since the County contractor typically charges a percentage overhead in addition to the subcontractor costs. Mr. Meyer asked who would be responsible for the maintenance. He stated that he recalled that the City and HRA had a number of questions about maintenance issues. iUL:Kctfa' x Y HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 20, 1993 - PAGE 4 Ms. Dacy recommended that the HRA authorize her to take quotes on what it would cost for the landscaping at the intersection and determine whether or not it would be appropriate to have it installed this fall or wait until the next budget year. Ms. Dacy stated that she will determine who will be responsible for the maintenance of the landscaping and advise the HRA of that when it is discussed. MOTION by Mr. Prairie, seconded by Mr. McFarland, to authorize staff to solicit quotes for the intersection landscaping and schedule final action for the HRA in August or September 1993 and to include information about maintenance responsibilities. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 4. CONSIDER AMENDED LEASEHOLD AGREEMENT FOR FRIDLEY PLAZA OFFICE BUILDING PARKING LOT: Ms. Dacy stated that she wants the HRA to table action on this item. She stated that she was having trouble contacting the property manager regarding the snow plowing language and the time- frame for the sealcoating. MOTION by Mr. Prairie, seconded by Mr. McFarland, to table the item until the June 10, 1993, HRA meeting. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 5. CONSIDER RESOLUTION DESIGNATING OFFICIAL DEPOSITORIES: Mr. Pribyl stated that this resolution defines the Fridley State Bank as the official depository for the HRA. The resolution also provides that the City Manager, Finance Director, and Assistant Finance Director are the official signers for the HRA checks. MOTION by Mr. Prairie, seconded by Mr. McFarland, to approve Resolution No. HRA 2 - 1993, Resolution Designating Official Depositories for the Fridley Housing and Redevelopment Authority. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 6. CLAIMS AND EXPENSES: Mr. Ellestad reviewed the expenses for the period from April 8 - 13, 1993. Mr. Ellestad also added check numbers 2343 through 2350. MOTION by Mr. McFarland, seconded by Mr. Prairie, to approve the claims and expenses and to issuance of checks, numbers 2304 - 2350. • "^'c+uLiitiil::.w+htu.V'avvucaa*cwcY<wc<xxxwiaacx+c+xxwoarxvxmcw �iJ7i:�i�7i2aJ71iH5AiSL{ZKRf2HSifdiitZtisTR HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 20, 1993 - PAGE 5 UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 7. PROPOSED STYROTECH PROJECT AT 61ST AVENUE/MAIN STREET: Mr. Burns stated that he wanted to add this item to the HRA agenda. He stated he was contacted by Everest Development Group regarding an interest by Styrotech Company to locate a 100,000 square foot building at the vacant parcel on the west side of Main Street and 61st Avenue. He stated that 45% of the building would be manufacturing, 50% warehousing, and the remaining 5% would be office. He stated the company manufactures styrofoam products like the underlayment for roofing. He estimated market value of the project would be $3 million, and the estimated tax value would be $2,500, 000. The Company is also looking at Brooklyn Park. Mr. Burns stated that Brooklyn Park's tax increment program offers a pay-as-you-go program in the amount of $426,000. He stated this was the present value amount. He stated that, given the City's current TIF guidelines, it would be difficult to compete with the Brooklyn Park offer. Mr. Casserly stated he had prepared a memorandum dated May 20, 1993, describing a potential assistance package. He stated the package consists of a $100,000 pay-as-you-go revenue note and an $150,000 loan. He noted that was based on the project value of $3 million. He believed the project value could substantially increase to $5 million after all building and equipment costs are included. Mr. Casserly stated that the Brooklyn Park district is an older district such that they do not have to compensate for the loss of local government aids. He stated Brooklyn Park is specifically being aggressive with manufacturing companies. This company's hourly wage is reasonably high; and, because of its unusual processing techniques, it requires a skilled labor force. Mr. Burns stated the company would employ approximately 60-70 employees. He stated the amount of truck traffic per day would be 20-30 trips. Mr. Prairie stated that FMC is reducing its labor force. He believe the loss in manufacturing jobs is very high. He questioned if the HRA should go beyond its guidelines in order to attract this type of company. Mr. McFarland asked if there were any pollution problems relating to the company. ..:zVM".4:,•;VV:zt.,tzt;t7 1 t tzt`t;:Tt,,iJ 4W, R iit3iit%;';3�i:3ii~: :�;••;~•• 3k.Yii3�3iz13 HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 20, 1993 - PAGE 6 Mr. Burns stated he was not aware of any problems with the Everest Group, but they did say that the company is not a hazardous waste generator. Mr. Casserly stated that they are not making the styrofoam product at this site but merely forming and cutting the product. Mr. Burns suggested that if the HRA wanted to pursue this company, he suggested that the HRA direct staff to finalize the project costs and re-figure a potential assisted package. Further, he suggested that the additional assistance would have to be compared to the HRA's cash flow because of the recent prioritization of HRA monies for housing programs. MOTION by Mr. Prairie, seconded by Mr. McFarland, to authorize Jim Casserly to revise the proposal to Styrotech based on a $5 million project cost and to direct staff to investigate the impact of the proposal on the HRA tax increment cash flow. UPON A VOICE VOTE, ALL VOTING AYE, ACTING CHAIRPERSON MEYER DECLARED THE MOTION CARRIED UNANIMOUSLY. 8. STATUS REPORT ON HRA HOUSING REHAB PROGRAMS: Mr. Fernelius updated the HRA on the CDBG program, the HOME program, the MHFA home improvement loan program (MHFA Fix-up Fund) , the Fannie Mae program, the HRA reserve fund, and the MHFA Rental Rehab Loan program. Mr. Fernelius stated that the pre-screening applications would be taken beginning Monday, June 14, 1993, and the application period would be extended to July 16, 1993 . He stated that he and Barbara Dacy had made a video newsletter; and they are preparing a half- page ad for the Fridley Focus, and an extensive article in the summer newsletter. Mr. Fernelius stated that regarding the CDBG program, a contract will be presented to the HRA board at its June meeting. He stated the County has raised the grant amount from $9,000 to $11,000. He stated it is proposed that Fridley's program would be consistent with the County's. Mr. Fernelius stated that regarding the federal HOME program, this money would probably not be available until this fall. He suggested that the HRA consider raising the income guidelines to 50% of the area media income as published by HUD. He stated this would provide more flexibility for program recipients. Mr. Fernelius described a new proposal for the MHFA HOME improvement loan program. He stated that when he came on board, he understood this program to be a "gap" financing program. He stated that while trying to implement this program, he had a number ---- . ocx+�t,:stacitli4Dtiiiit} .f;?'f�.;+rz.` Z- titiizzi# 3i3iaiH;ivi3} ii 41 HOUSING & REDEVELOPMENT AUTHORITY MEETING MAY 20 199 - PAGE 7 of concerns about this approach. He stated that it may not be fair to assist a very small group of people, many of whom may be a poor credit risk. Secondly, the subsidy level of HRA funds would be focused into a small number of households, reducing the HRA's ability to assist as many people as possible. Further, there may be a greater risk to the HRA in the event of the borrower default. Mr. Fernelius stated that in order to encourage people to make improvements to their homes, assist those who qualify maximum the HRA dollars, and reduce the risk to HRA funds, heais proposing that the program be administered such that the HRA would provide a no interest deferred loan based on the following: Loan Percentage Maximum Ner Amount Reduction Assistance of Loans m@mThisLevel Less than $5,000 10g $5, 001 to $10, 000 12.5% $1,2500 148 $10, 001 to $15, 000 15% 2 $2,250 26 Mr. Fernelius stated that staff has determined a new name to refer to the Fannie Mae financing program. The new program name is the_ HOME Mortgage Assistance Program. He stated that Fay Wegner will be submitted origination agreements to be approved by the HRA at its June meeting. Mr. Fernelius stated that he is recommending that they not prepare specific guidelines for the reserve fund until the first round of applications has been reviewed and approved. After that time, we will know more about the types of applications which will fall through the funding cracks, and the HRA can determine on a case- by-case basis how to handle those situations. Mr. Fernelius stated that the Rental Rehab Loan Program would be administered in a similar fashion to the proposal outlined for the MHFA home improvement loan program. He stated he has been working more on the single family programs in order to get the pre- screening application process started, but thisavailable this summer as well. program would be The HRA did not have specific questions of staff. 9. RICE PLAZA UPDATE: Ms. Dacy had nothing further to report about the monthly rent statement for Rice Plaza. 10. FOLLOW-UP ON LAKE POINTE BID INFORMATION: Ms. Dacy stated that Mr. Meyer had requested this information to determine the alternate A and alternate B bid requests. ........... ...: tz 43 , ' ,..,zaaai,l •,. t .Silfat£tuttiSacoiczasm,...,,,.,0,,...,.........,.�.....__ , , i.•ti-2 t+sue l tz C 'i,tr,'' 'a • il HOUSING & REDEVELOPMENT AUTHORITY MEE ING MAY 20 1993 - PAGE 8 • 11. FOLLOW-UP ON TAXES FOR HRA PROPERTY• Ms. Dacy stated that Mr. Commers had requested this information. She stated she had provided copies of the tax statements heor taxes HRA property at the southwest quadrant. The reason why the tax increased was not because of an increase in the property valubut because of the school district referendum. 12. MEMO OF HRA ANNUAL REPORT FOR SUMMER NEWSLETTER: the Ms. Dacy stated that the summerinclude to er re will ont in housing annual report. Articles will programs with a picture of Grant Fernelius. Also, a picture and e Sheet ors article will be published about h Metal Hopefully drawingrof and Bob's Produce redevelopment Project the Mississippi Street reconstruction will be included, as well as some pictures. Mr. Prairie asked whether or not information was going to be published about the Lake Pointe property. Msstated she has been working with Mr. Froehle on this, and it would be possibly a picture icture of the site and a short paragraph t on the result of the joint HRA and City Council meeting on May 8, 1993. She stated she had not yet had a chance to review this item with Mr. Burns. 13. UPDATE ON FRIDLEY TOWNE S UARE REDEVELOPMENT PROJECT: Mr. Casserly reported that Mr. Wagner has regiment with Don workcon the final details on their partnership agith the bank had not been Further, the construction financing finalized, but Mr. Wagner reported that he does have control of the three properties. Mr. Casserly stated that Mr. Wagner had to resubmit the application to to Walgreen since there was change in management position in Walgreen's corporate structure. ADJOURNMENT• • seconded by Mr. McFarland, to adjourn the MOTION by Mr. Prairie, a Acting meeting. Upon a voice vote, all voting aye, 1993 ,Chairpersonirr & Meyer declared the motion gid and the adjourned aty9?0,05 p.m. Redevelopment Authority meeting Respectfully submitted, Ly a Saba Recording Secretary 4 2.1 / Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 1, 1993 TO: William Burns, Executive Director of HRA 4JI FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Resolution Authorizing Home Improvement Loan Program Proposed for HRA consideration is the first of three resolutions which must be adopted by the HRA in order to implement our various housing rehab programs. This resolution pertains to the Home Improvement Loan Program. The resolution accomplishes several functions including: 1. Establishes the program and area of operation. 2. Provides for delegation of certain powers and duties. 3 . Authorizes execution of an agreement between the HRA and Fridley State Bank for the program. As you will recall, the purpose of this program is to provide low interest loans to owner/occupants of 1-4 unit properties. Owners can borrow up to $15,000 for a maximum term of 15 years at an interest rate of 3-9 3/4%. To qualify for the program, a borrower must: 1. Have a gross annual income of $41,000 or less. 2. Have a good credit history and demonstrated ability to repay the loan. 3. Have sufficient equity in their home if security is required. The bulk of the financing will be provided through the Minnesota Housing Finance Agency (MHFA) ; however, the HRA will provide deferred loans to help owners reduce their borrowing costs. HRA funds will be used in conjunction with the MHFA program as follows: i 2.2 Resolution Authorizing Home Improvement Loan Program July 1, 1993 Page 2 If the applicant The HRA will provide borrows from MHFA: deferred payment loan: Not to exceed: Up to $5,000 equal to 10% of the MHFA $500 loan amount $5,001 to $10, 000 12% of the MHFA loan $1, 250 $10, 001 to $15,000 15% of the MHFA loan $2,250 The HRA loan does not have to be repaid until the owner sells his/her home. We will work with Fridley State Bank to process loans after the applicants have gone through the pre-screening process. We anticipate to start making loans some time in August. GF:ls M-93-387 1w t 2.3 RESOLUTION NO. A RESOLUTION ESTABLISHING A HOME IMPROVEMENT LOAN PROGRAM; ESTABLISHING THE AREA OF OPERATION; PROVIDING FOR THE DELEGATION OF CERTAIN POWERS AND DUTIES; AUTHORIZING THE EXECUTION OF A MEMORANDUM OF UNDERSTANDING BY AND BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY AND THE FRIDLEY STATE BANK. BE IT RESOLVED by the Board of Commissioners (the "Commissioners") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority") , as follows: Section 1 . Recitals. 1 .01 . It has been proposed that the Authority establish a Home Improvement Loan Program (the "Program") for the residents of the City of Fridley (the "City") . 1 .02. It has been further proposed that the Authority participate with the Minnesota Housing Finance Agency (the "M.H.F.A.") to secure funding and that the Authority provide its funds for additional assistance. 1 .03. It has been further proposed that the Authority enter into the necessary agreements to implement the Program including a Memorandum of Understanding (the "Memorandum") with the Fridley State Bank (the "Bank") as a participating lender. Section 2. Findings. 2.01 . The Authority hereby finds that its area of operation in which to implement the Program is the area within the territorial boundaries of the City as provided for in Minnesota Statutes, Section 469.002, Subd. 8. 2. 02. The Authority hereby finds that the adoption of the Program promotes the purposes of the Authority as those purposes are defined in Minnesota Statutes, Section 469.001 , et seq. (the "Act") . 2. 03 . The Authority hereby finds that the Program will assist in the alleviation of shortages of decent, safe and sanitary residential housing available within the City at prices affordable to persons and families of low or moderate income as described therein. 2. 04. The Authority hereby finds that preservation of the quality of life in the City is dependent upon the maintenance, provision, and preservation of an adequate housing stock; that accomplishing 4 2.4 Page 2 - Resolution No. the is a public purpose in that there are many residences in the City which require rehabilitation; that a need exists to provide in a timely fashion affordable housing to persons of low and moderate income as described in the that and manherein y nersresiding and expected to reside in the City; purchasers or providers of residences are unable to obtain mortgage credit for rehabilitation of residences under current market conditions; and that in establishing its Program the Authority is acting in all respects to benefit the citizens of the City and to serve a public purpose in improving and otherwise promoting their health, welfare and prosperity. Section 3. Authorization of program. 3 .01 . The Authority hereby approves and adopts the Program as described on Schedule A attached to this Resolution. Section 4. Delegation of Power and Duties. 4.01 . In accordance with the Act,and specifically nnesota with the tProgram Section 429.012, Subd. 1 (3) , n Description and Guidelines, the officers, agents and employees of take such actions as may c Autho to are hereby the Memorandumo and operate the Program. be necessary to implement r are 4.02 . The Executive Director or relating to theapprovalrand authorized to execute all documents closing of any loans provided for in the Program. Section 5 . Authorization for Execution of Memorandum. 5 .01 . The Authority hereby approves the Memorandum substantially in the form presented to the Authority and authorizes its Chairman and Executive Director to execute the Memorandum on behalf of the Authorityam with able ch or necessary ations and s evidenced by the ifications as those officers execution may deem desirable thereof. r , • 2.5 Page 3 - Resolution No. PASSED AND ADOPTED BY THE FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF FRIDLEY THIS DAY OF 1993. • LAWRENCE R. COMMERS - CHAIRPERSON ATTEST: WILLIAM W. BURNS - EXECUTIVE DIRECTOR � ry a 3.1 Community Development De artment n, HOUSING AND RED p EVELOPMENT AUTHORITY City of Fridley DATE: July 1, 1993 TO: William Burns, Executive Director of HRA 410 FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Resolution Authorizing Home Mortgage Assistance Program Proposed for HRA consideration is the second resolution which must be adopted. This resolution pertains to the Home Mortgage Assistance Program. The resolution authorizes the following: 1. Establishment of the program and area of operation. 2. Delegates certain powers and duties. 3. Execution of a Mortgage Origination Agreement with United Mortgage. This program provides assistance to homeowners/homebuyers for down payment, closing costs, and/or home rehabilitation work. HRA funds will be issued in the form of a deferred payment loan that does not have to be repaid until the owner sells his/her home. For homeowners, there are two options: 1. Refinance and Rehab An owner can receive a deferred payment loan for up to 5% of the mortgage amount not to exceed $6, 000. Restrictions: First mortgage cannot exceed $120,000. Home value cannot exceed $126,000. At least 10% of the mortgage must be used for home rehabilitation. 2. Rehab Onl An owner who wishes to complete the minimum of $15, 000 worth of rehab can receive a deferred payment loan for up to 10% of the rehab mortgage amount not to exceed $3, 795. In addition to any closing costs, the HRA funds can also be used to pay for part of the rehab work. 3.2 Resolution Authorizing Home Mortgage Assistance Program July 1, 1993 Page 2 For homebuyers, there are two options as well: 1. Purchase and Rehab A buyer can receive a deferred payment loan for up to 5% of the first mortgage amount not to exceed $6,000. Restrictions: Same as Refinance and Rehab Option. 2. Purchase Only This option is only available to buyers who will be converting the property from non-homestead status to homestead status. The HRA will provide a deferred tloan ofor eup to eto 3%$of600e first mortgage amount, Restrictions: First mortgage cannot exceed $120,000. Home value cannot exceed $126,000. After the pre-screening process has been completed, the HRA will perform an inspection of the property to ensure code-related repairs are made. Applicants will then have 30 days to make a mortgage application with United Mortgage. GF:ls M-93-392 • 4 a 3.3 RESOLUTION NO. A RESOLUTION ESTABLISHING A HOME MORTGAGE ASSISTANCE PROGRAM; ESTABLISHING THE AREA OF OPERATION; PROVIDING FOR THE DELEGATION OF CERTAIN POWERS AND DUTIES; AUTHORIZING THE EXECUTION OF A MORTGAGE ORIGINATION AGREEMENT BY AND BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY AND UNITED MORTGAGE CORPORATION. BE IT RESOLVED by the Board of Commissioners (the "Commissioners") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority") , as follows: Section 1 . Recitals. 1 .01 . It has been proposed that the Authority establish a Home Mortgage Assistance Program (the "Program") for the residents of the City of Fridley (the "City") . 1 .02. It has been further proposed that the Authority enter into the necessary agreements to implement the Program including a Mortgage Origination Agreement (the "Origination Agreement") with United Mortgage Corporation (the "Bank") as participating lender. Section 2. Findings. 2.01 . The Authority hereby finds that its area of operation in which to implement the Program is the area within the territorial boundaries of the City as provided for in Minnesota Statutes, Section 469.002, Subd. 8. 2.02. The Authority hereby finds that the adoption of the Program promotes the purposes of the Authority as those purposes are defined in Minnesota Statutes, Section 469.001 , et seg. (the "Act") . 2 .03. The Authority hereby finds that the Program will assist in the alleviation of shortages of decent, safe and sanitary residential housing available within the City at prices affordable to persons and families of low or moderate income as described therein. 2.04. The Authority hereby finds that preservation of the quality of life in the City is dependent upon the maintenance, provision, and preservation of an adequate housing stock; that accomplishing this is a public purpose in that there are many residences in the City which require rehabilitation; that a need exists to provide in a timely fashion affordable housing to persons of low and moderate income as described in the Act and herein residing and expected to reside in the City; that many owners, would-be 3,4 Page 2 - Resolution No. purchasers or providers of residences are unable to obtain mortgage credit for rehabilitation of residences under current market conditions; and that in establishing its Program the Authority is acting in all respects to benefit the citizens of the City and to serve a public purpose in improving and otherwise promoting their health, welfare and prosperity. Section 3. Authorization of Program. 3 .01 . The Authority hereby approves and adopts the Program as described in the Origination Agreement and on Schedule A attached to this Resolution. Section 4. Delegation of Power and Duties. 4.01 . In accordance with the Act, specifically Minnesota Statutes, Section 429.012, Subd. 1 (3) , and in accordance with the Program Description and Guidelines, the officers, agents and employees of the Authority are hereby authorized to take such actions as may be necessary to implement the Origination Agreement and operate the Program. 4.02 . The Executive Director or Housing Coordinator are hereby authorized to execute all documents relating to the approval and closing of any loans provided for in the Program. Section 5. Authorization for Execution of the Origination Agreement. 5.01 . The Authority hereby approves the Origination Agreement substantially in the form presented to the Authority and authorizes its Chairman and Executive Director to execute the Origination Agreement on behalf of the Authority with such additions and modifications as those officers may deem desirable or necessary as evidenced by the execution thereof. • , 3.5 Page 3 - Resolution No. PASSED AND ADOPTED BY THE FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF FRIDLEY THIS DAY OF 1993. LAWRENCE R. COMMERS - CHAIRPERSON ATTEST: WILLIAM W. BURNS - EXECUTIVE DIRECTOR 3.6 CERTIFICATION I, William W. Burns, Executive Director of the Housing and Redevelopment Authority in and for the City of Fridley, County of Anoka, Minnesota, hereby certify that the foregoing is a true and correct copy of Resolution No. passed by the Authority on the day of , 1993. WILLIAM W. BURNS - EXECUTIVE DIRECTOR 3.7 SCHEDULE A DESCRIPTION AND GUIDELINES FOR THE HOME MORTGAGE ASSISTANCE PROGRAM Loan Description No-interest, deferred payment loan (Deferred Loan) for help with down payment, closing costs and home rehabilitation. Funding Source The Authority. Participating Lender United Mortgage Corporation. Qualifications Income Limits: $55, 000 Underwriting: Normal Bank Standards Equity: Normal Bank Loan to Value Percentage Property Type: Owner Occupied 1 to 4 Unit Properties Program Specifics As described above, this program provides down payment and closing cost assistance to both homebuyers and homeowners. Homeowners who wish to either: 1 ) Refinance and rehab their home, receive a Deferred Loan of 5% of the first mortgage, not to exceed $6, 000. Restrictions: a) 10% of the total mortgage amount must be used for rehabilitation. b) Mortgage cannot exceed $120, 000. c) Home value cannot exceed $126, 500. FHA, VA or conventional first mortgage financing is eligible. 2) Rehabilitate their homes, receive a Deferred Loan of 10% of the mortgage amount, not to exceed $3, 795. Funds may be used for closing costs and home rehabilitation. , 3.8 Restrictions: a) Minimum amount of rehab $15,000; maximum not to exceed 30% of home value or $37,950. For homebuyers who wish to: 1 ) Purchase home,a exceed Deferred f red Loan is 3% of the first mortgage amount, not to Restrictions: a) Only allowed for the conversion of non-homestead property to homestead property. b) Maximum mortgage cannot exceed $120,000. Home value cannot exceed $126,500. 2) Purchase and rehab a home, the $6 Opp red Loan is 5% of the mortgage amount, not to Restrictions: a) Same as with homeowners who wish to refinance and rehab their home as descried above. General Requirements Applications for the Home Mortgage Assistance Loan Program will be accepted by the Authority, beginning on June 14, 1993 through July 16, 1993. Additional application periods may be established by the Authority. After the closing date, the applications will be reviewed for general eligibility (i.e.hen thoselance which with meet this etestldwill elinebe property type, ranked based on: 1 ) Age of property 2) Type of improvement 3) Location of property 4) Applicant' s income Points will be awarded for each category; those with high scores will receive the first priority on program funds ( udfng the r the program enhancements for the loan programs) . Applicants loan programs will be directed to the participating lender. In the event demand exceeds the funding supply, a waiting list will be maintained. ' 'J Community Development Department 1 HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 1, 1993 TO: T • William Burns, Executive Director of HRA dit FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Resolution Authorizing Rental Rehabilitation Loan Program Proposed for HRA consideration is the last of the resolutions which must be adopted. This resolution authorizes implementation of the Rental Rehabilitation Loan Program which is funded through the Minnesota Housing Finance Agency. The program will provide low interest loans for improvements to residential rental property. Eligible owners can borrow up to $15,000 for single unit properties or the lesser of $8,000 per unit or $40,000 per building for multi- unit properties. In an effort to reduce the borrower's costs, the HRA will provide a deferred loan in conjunction with the primary loan. The deferred loan will be equal to 10% of the primary loan. The HRA loan does not have to be repaid until the property is sold. Fridley State Bank has agreed to take applications and perform underwriting functions for the HRA. The Bank will also close the primary loans and the HRA deferred loans. The HRA will conduct initial and final inspections. We hope to have this program available in early August. GF:ls M-93-393 4.2 RESOLUTION NO. A RESOLUTION ESTABLISHING A RENTAL REHABILITATION LOAN PROGRAM; ESTABLISHING THE AREA OF OPERATION; PROVIDING FOR THE DELEGATION OF CERTAIN POWERS AND DUTIES; AUTHORIZING THE EXECUTION OF A MEMORANDUM OF UNDERSTANDING BY AND BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY AND THE FRIDLEY STATE BANK; AUTHORIZING EXECUTION OF AN ADMINISTRATION CONTRACT WITH THE MINNESOTA HOUSING FINANCE AGENCY. BE IT RESOLVED by the Board of Commissioners (the "Commissioners") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority") , as follows: Section 1 . Recitals. 1 .01 . It has been proposed that the Authority establish a Rental Rehabilitation Loan Program (the "Program") for the residents of the City of Fridley (the "City") . 1 . 02 . It has been further proposed that the Authority participate with the Minnesota Housing Finance Agency (the "M.H.F.A.") to secure funding and that the Authority provide its funds for additional assistance and that the Authority enter into an Administration Contract with the M.H.F.A. 1 .03. It has been further proposed that the Authority enter into the necessary agreements to implement the Program including a Memorandum of Understanding (the "Memorandum") with the Fridley State Bank (the "Bank") as a participating lender. Section 2. Findings. 2. 01 . The Authority hereby finds that its area of operation in which to implement the Program is the area within the territorial boundaries of the City as provided for in Minnesota Statutes, Section 469 .002, Subd. 8. 2.02. The Authority hereby finds that the adoption of the Program promotes the purposes of the Authority as those purposes are defined in Minnesota Statutes, Section 469 .001 , et sea. (the "Act" ) . 2.03. The Authority hereby finds that the Program will assist in the alleviation of shortages of decent, safe and sanitary residential housing available within the City at prices affordable to persons and families of low or moderate income as described therein. 2.3 Page 2 - Resolution No. 2. 04. The Authority hereby finds that preservation of of life in the City is dependent upon the maintenance, tpe quality rovisi and preservation of an adequate housing stock; that accomplishing the is a public purpose in that there are many residences in theg City which require rehabilitation; that a need exists to provide in a timely fashion affordable housing to persof low and moderate income as described in the Act and herein residing and expected to reside in the City; purchasersxeed or that many owners, would-be providers of residences are unable to obtain mortgage credit for rehabilitation of residences under current market conditions; and that in establishing its Program the Authority is acting in all respects to benefit the citizens of the City and to serve a public purpose in improving and otherwise promoting their health, welfare and prosperity. Section 3. Authorization of Pro ram. 3.01 . The Authority hereby approves and adopts the Program as described on Schedule A attached to this Resolution. Section 4. Delegation of Power and Duties. 4.01 . In accordance with the Act, specifically Minnesota Statutes, Section 429.012, Subd. 1 (3) , and in accordance with the Program Description and Guidelines, the officers, agents and employees of the Authority are hereby authorized to take such actions as may be necessary to implement the Memorandum and operate the Program. 4. 02. The Executive Director or Housing Coordinator are hereb authorized to execute all documents relatingto the a y closing of any loans provided for in the Program. PProval and Section 5. Authorization for Execution of Memorandum. 5.01 . The Authority hereby approves the Memorandum substantially in the form presented to the Authority and authorizes its Chairman and Executive Director to execute the Memorandum on behalf of the Authority with such additions and modifications as those officers may deem desirable or necessary as evidenced by the execution thereof. Section 6. Authorization for Execution of Administration Contract. 6. 01 . The Authority hereby approves the Administration Contract substantially in the form presented to the Authority and authorizes its Chairman and Executive Director to execute the Administration Contract on behalf of the Authority with such additions and modifications as those officers may deem desirable or necessary as evidenced by the execution thereof. 4.3 Page 3 - Resolution No. PASSED AND ADOPTED BY THE FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF FRIDLEY THIS DAY OF 1993. LAWRENCE R. COMMERS - CHAIRPERSON ATTEST: WILLIAM W. BURNS - EXECUTIVE DIRECTOR ,► 5.1 , Community Development Department \ HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 1, 1993 TO: William Burns, Executive Director of HRA L/0 FROM: Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Resolution Regarding Contract Inspectors for Housing Rehabilitation Program Proposed for HRA consideration is a resolution which authorizes staff to enter into an agreement for inspection services. All properties financed through our programs will be inspected prior to committing HRA funds. The inspection will ensure that the property meets basic code requirements (i.e. , electrical, plumbing, mechanical, health and safety) . We met with Tom Blazina, Chief Building Official, to develop a list of minimum qualifications for the inspectors. He suggested we contract with building inspectors from other communities. Inspections could be conducted in the evening which would obviously be convenient for the homeowner. Our plan is to utilize two to three contract inspectors for the program and compensate them on a flat rate basis of $105 for initial inspections and $70 for final inspections (if necessary) . In order to meet the program schedule, we will need to have the inspectors under contract by no later than August 1, 1993. GF:ls M-93-394 5.2 RESOLUTION NO. A RESOLUTION AUTHORIZING EXECUTION OF A CONTRACT FOR HOUSING REHABILITATION INSPECTION SERVICES. BE IT RESOLVED by the Board of Commissioners (the "Commissioners") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority") , as follows: Section 1 . Recitals. 1 .01 . It has been proposed that the Authority provide housing inspections for its loan programs and contract with independent inspectors for the inspection of properties. Section 2. Findings. 2.01 . The Authority has developed several housing rehabilitation programs which require the inspection of properties. Section 3. Authorization. 3.01 . The Executive Director or Housing Coordinator are hereby authorized to select independent fee inspectors for the inspection of properties. 3.02. The Authority hereby approves the Contract for Housing Rehabilitation Inspection Services (the "Contract") substantially in the form presented to the Authority and hereby authorizes the Executive Director or Housing Coordinator to execute the Contract on behalf of the Authority with such additions and modifications as those persons may deem desirable or necessary as evidenced by the execution thereof. PASSED AND ADOPTED BY THE FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF FRIDLEY THIS DAY OF 1993. LAWRENCE R. COMMERS - CHAIRPERSON ATTEST: WILLIAM W. BURNS - EXECUTIVE DIRECTOR 5.3 CERTIFICATION I, William W. Burns, Executive Director of the Housing and Redevelopment Authority in and for the City of Fridley, County of Anoka, Minnesota, hereby certify that the foregoing is a true and correct copy of Resolution No. passed by the Authority on the day of , 1993. WILLIAM W. BURNS - EXECUTIVE DIRECTOR 5.4 Contract for Housing Rehabilitation Inspection Services THIS AGREEMENT, entered into as of this day of , 1993, by and between the Fridley Housing and Redevelopment Authority (here- inafter referred to as the "HRA") a public body corporate and politic exist- ing under the laws of the State of Minnesota, and (hereinafter referred to as the "Contractor") an individual residing at WITNESSETH: WHEREAS, the HRA has determined the need to preserve the existing housing stock within the City of Fridley, Minnesota; and WHEREAS, the HRA has developed several housing rehabilitation programs to meet these needs; and WHEREAS, the HRA has determined that it is necessary to conduct inspections of properties which will benefit from said programs; and WHEREAS, the HRA has determined it would be cost efficient to contract said inspections with an independent fee inspector and desires to engage the professional services of the Contractor. NOW, THEREFORE, the parties hereto mutually agree as follows: 1. Scope of Services: The Contractor shall perform all of the services under this Agreement in connection with the housing rehabilitation programs, including: 1) Determine the existing conditions of the electrical, plumbing, structural, and health and safety systems. 2) Develop a list of minimum improvements which must be corrected. The Contractor shall use an inspection form approved by the HRA to complete the report (see Exhibit A) . 2. Time of Performance: The services of the Contractor are to be conducted on a project-by-project basis. The Contractor shall only proceed with an inspection after receiving an Inspection Work Order (see Exhibit B) . The Contractor shall commence the inspection within a reasonable time period, but in no event later than 10 business days after receipt of the Inspection Work Order. The inspection shall be conducted and completed in a professional manner and between the hours of 8:00 a.m. and 9:00 p.m. The Contractor shall be responsible for contacting the owner and scheduling the inspection; the Contractor shall make every effort to accommodate the owner by scheduling a time that is convenient for the owner. The owner shall be furnished with a written copy of the report within 5 business of the inspection, and the original must be submitted to the HRA during the same period. 5.5 3. Compensation: Compensation shall be paid to the Contractor based on the following fee schedule: $105. 00 Initial Inspection $70.00 Final Inspection Compensation shall cover all costs related to the inspection, including overhead, mileage, phone, etc. 4. Method of Payment: The HRA shall pay the Contractor once a month for services completed. In order to receive payment, the Contractor must furnish an invoice to the HRA by first Wednesday of the month. The invoice must clearly identify the following: a) Name and address of property owner b) Date of inspection c) Amount due to Contractor The HRA will verify that the original inspection report was received and a copy sent to the property owner. Payment will then be processed and sent to the Contractor at the address identified above by the 15th of the month. 5. Amendments: This Agreement may be amended from time to time, but only mutual written consent of the parties. 6. Assignment and Subcontracting: The Contractor may not assign or subcontract any portion of this Agreement without the written consent of the HRA, and it is further agreed that said consent must be sought by the Contractor not less than fifteen (15) days prior to the date of any proposed assignment. 7. Hold Harmless and Indemnification: The Contractor agrees to protect and save the HRA, its Board of Commissioners, agents, and employees while acting in the scope of their duties as such, harmless from and against all claims, demands, and causes of action of any kind or character, including the cost of defense thereof, arising in favor of the Contractor on account of personal injuries, death or damage to property arising out of services performed or omissions of services or in any way resulting from acts or omissions of the Contractor. 8. Data Privacy: All information generated as a result of the Contractors services are considered confidential. The Contractor shall refrain from disclosing any of the information contained in the report with anyone except, the property owner, HRA or authorized employees of the City of Fridley. 9. Termination: This Agreement may be terminated, with or without cause by the HRA, by providing the Contractor with written notice. Any work in progress, including inspection reports, notes, etc. shall be forwarded to the HRA immediately, and the Contractor shall be 5.6 9. Termination (cont. ) : compensated on a pro-rata basis for said work. 10. Nondiscrimination: The Contractor shall comply with all federal, state and local laws prohibiting discrimination on the basis of age, sex, marital status, race, creed, color, national origin, reliance on public assistance or the presence of any sensory, mental or physical handicap. IN TESTIMONY HEREOF, the parties hereto have executed this agreement. FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY Executed this day of By: , 19 Its: CONTRACTOR Executed this day of By: , 19 Its: C:\WP\REHABCON s 6.1 RESOLUTION D. - 1993 RESOLUTION ADOPTING ICE RETIRINEw CORPORATION AS THE DEFERRED COMPENSATION PLAN PROVIDER FOR THE FRIDLEY HOUSING & REDEVELOPMENT AUIHORITY SEAS, the Fridley Housing & Redevelopt Authority hasloyees rendering valuable services; and WHEREAS, the establishment of a deferred compensation plan for such employees serves the interests of the Employer by enabling it to provide reasonable retirement security for its employes, by providing increased flexibility in its personnel management system, and by assisting in the attraction and retention of competent personnel; and MEREAS, the rployer has determined that the establishmwnt of a deferred compensation plan to be administered by the IGAA Retirement Corporation serves the above objectives; and WHEREAS, the thployer desires that its deferred compensation plan be administered by the ICE Retirement Corporation, and that the funds held under such plan be invested in the Imo' Retirement Trust, a trust established by public employers for the collective investment of funds held under their retiramn„nt and deferred compensation plans; NOW THEREFORE BE IT RESOLVED that the Employer hereby adopts the deferred compensation plan (the "Plan") in the form of: The ICNA Retire ent Corporation Deferred Compensation Plan, and BE IT FURTHER RESOLVED that the Employer hereby executes the Declaration of Trust of the ICMA Retirement Trust, and BE IT FURTHER RESOLVED that the Finance Director shall be the coordinator for this program; A,shall receive necessary reports, notices, etc. frau the ICMA Retirement Corporation or the IC Retirement Trust; shall mot, on behalf of the Employer; any required votes under the IONA Retirement Trust; may delegate any administrative duties relating to the Plan to appropriate departments; and is authorized to execute all nfethe agreements with ICE Retirement Corporation incidental to the administration o . PASSED AND ADOPTED BY THE FRIDLEY HOUSING & REDEVEWPMENT AUIFIORITY THIS , 1993. DAY OF LAWRENCE R. CaimERS - CHAIRMAN ATTEST: WILLIAM W.BURNS - EXECUTIVE DIRECTOR r r 701 r I H I 670N0,O0)OO +MOOroO..00•00000.0O1.0000 NON0000 0 i Z i 1-41Cn7A•00041.441001A41NNC470t'JU3A.+OONN.•ti` Q'OA00 0) I DI • )o • - • • O • t • sO0 • 1• s 0 • 3 . • 1 • • • • • • •O 4 I D I Ar-tM ` o04As4OiAM40OrC40NsQ04v4.,U701MO1 O A I Z i 0v0.+M03C40.i MNA•ONO 471'41M0v0-6.4ChCO sOMI-QNMOONN O 111 0i C i Ad' C4.•i.I47 0.i C: .•L M t`OA.iC •t. ol47MC4`O .+047.{47 C4 C i 47.t M N N M C4 •L. C .i 4-4 r N M N ('I Os V I I 1M N i i i i i 1 i i i i • i . i i L i I * �X01 C4JCOC QLU-t 0) C I H CL M H O C1). 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Z OWOUN)-CCiZOWUH UZUIU-CO CC CC CC CC JH - •t O JQ7-0Y CCC QJJCC3CCC 0)-} HHH?-CLYYQ=O 41 I CC CLAWOQ • L5 •1:CC 000UI •OWW C •CCCO W QQZ W H t D CWZJUHCZWdZWYZOWZCLWJJCYQWCCHHHJ7-I-4HOO.L5 .i D r A i ZOIWAC44 4 HZ •W0)CCWQZH 4 ZA0YWZZCNOWAHAAHCYH 47 Q Z LC 07 p_!4 C X al CO it CO Ld 03 <C CL<CitC4NZHHOHCCZZCCCCiYHOCCLCHQD W CQWCY00 •OH 4 CCCJWNHO 4 HCCXit CCOWHHHCCZ000SQ gr H > CO 044 LC.HYZHZZU' C.)L)43 1-4 i:1.-it 1:LL LL<I<CO C.)44 4.LLU.LLHYYZNH .L z W 1 PI a A 0 \ J .+J W 00> \ICiW L N to A 1:Id LStt A MMMMMMMMMMMMMMMMMMMM PIMP)PIMP,MMMMMMMMMM WZL5 AAAAAAAAAAAAAAAAAAAAAAAA Ch.AAAAAAAAAAA CC Q Z Y W N. \\\\N.\\\N.\N.\N.\\\\\\N.\\\\\\\\N.\\\N.\\ Q CC H U H v C'Q•Q Q•m-1-d's f'Ar N 47 67 47 41 n 47 47 0 0 0)0 03 CO O CO CO CO 03 0 CO CO CO 0 CO CO CL 0 CO W C .+.t.+.1.+.i rt.i.i.t 0.t.+.i.t.+.i.+.L.+.4 O O O O O O O O O O O O O O O WCa X0L \\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\ cC CC. 0 0 I 41 41 61 41 UI 41 41 In 47 41 v0 v0.0.0 v0.0.0.0.0 v0.0 N r-N N N N N N N N N N r'-I-t` 7.2 TO: FRIDLEY H.R.A FROM: CITY OF FRIDLEY RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES MAY 1993 Account#'s for Account#'s for HRA's Use City's Use :................................................ ADMINISTRATIVE BILLING: ADMINISTRATIVE PERSONAL SERVICES 13,842.00 101-0000-341-1200 ADMINISTRATIVE OVERHEAD • 250.00 101-0000-336-3000 TOTAL ADMINISTRATIVE BILLING : 460-0000-430-4330 14,092.00 OPERATING EXPENSES: MIRCOWAREHOUSE—WP 5.1 &DIRECT ACCESS 460-0000-430-4221 361.22 236-0000-336-3000 POSTAGE BY PHONE—POSTAGE 460-0000-430-4332 28.72 236-0000-336-3000 CITY OF FRIDLEY—PETTY CASH 460-0000-430-4337 11.53 236-0000-336-3000 CITY OF FRIDLEY— MINNEGASCO&EMBOSSER 450-0000-202-0000 21.67 236-0000-208-3000 CITY OF FRIDLEY—NSP 455-0000-202-0000 7.03 236-0000-208-3000 TOTAL OPERATING EXPENSES : 430.17 .............................. TOTAL EXPENDITURES — MAY 1993 File:t123DATA\HRA\TIF193BILL.wk1 7.3 TO: FRIDLEY H.R.A FROM: CITY OF FRIDLEY RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES JUN 1993 Account#s for Account#'s for HRA's Use City's Use ADMINISTRATIVE BILLING: ADMINISTRATIVE PERSONAL SERVICES 13,842.00 101-0000-341-1200 ADMINISTRATIVE OVERHEAD 250.00 101-0000-336-3000 TOTAL ADMINISTRATIVE BILLING : 460-0000-430-4330 14,092.00 OPERATING EXPENSES: NYSTROM PUBUSHING— SUMMER NEWSLETTER 460-0000-430-4335 1031.00 236-0000-336-3000 TOTAL OPERATING EXPENSES : 1,031.00 TOTAL EXPENDITURES — JUN 1993 File:\123DATA\HRA\TIF\93BILL.wM 7.4 • .-in u1 0l O W 0 CO W a05s az c[ u v w 0 0 s (,� Y w G.N-�(no <�z< _.'UCCWGcU-mco I I IY IEe 1 1Ec Ym >. )-)-r� > )->- 1 1 M 0 Gil 1- LIP.1888 28888 ^ M G .411O • • 8 Y • 00000 0N W � O CD 0Is I- �NM1:0 •b%O - O iCZ CC O\^ 00 W - .-N I- 0 O U N < Z pW 888 00000000 0 W [mom p Q S p o p p o <2 W 1 j 1 I ( 1 0p1 i 01 1 0p1• 4125 • • () =0C NCO NNNNONNOO (J 00 LLLLmmJJ NNNNNNYNNYY O�OsA O ,0,0.0.0,0'00,0'000 J U M M M M M M—M M-- < 1 81, 811 1 p1 p1 p1 1 pt pI p1 p1 p1 O Opp 0 0 0 O Oa O O 00 pOp U U U J M O M M M M p M M 0 0 «l- $ 2$$2 20s7 mm 0 W I- W.4 K Oi W p\�\\\\�\\\\� ZN N Z 'O b b'0'0 b'0'0 b'0'0 O G owl u2 so'now U p� O W ' a � • Kid N 7.5 ,-M CO P O Dow Q•..m 0-K£ W M 0_2 O I- 0 O 0 f-a o 2 w 8. - mac. 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M 0 w \\\\\\\\\\\\\ J Q F 0000000000000 < M M M M M M M M M M M M M 2 CO I- O \\\\\\\\\\\\\ 0 W •0.0.0.0•O.0.0.0 NO,0.O.O.O • £ F- M 0_ C...)0, 0 '- Q \ -1 0_ N M M> W 2 Q •O,-O W Inst st v1.0.0.0.OF-F- CO CO 1- PPPP0•PPPP0•PPO• ~ x iii cc CO CO Ca CO CO CO CO CO CO CO CO CO CO 2 O U w£C7 cc Q 2 In Q .-.. 2 0. N W O 0 Q CC CC Cl.0_= I J 8.1 nI Community Develo ment De artment ii\ HOUSINGP P AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 1, 1993 ni0 t TO: William Burns, Executive Director of HRA A FROM: Barbara Dacy, Community Development Director SUBJECT: Discuss Status of Rice Plaza Background During the 1993 budget discussion, the HRA requested a cash flow analysis on Rice Plaza in order to determine whether it was appropriate to demolish the building in 1993 or 1994. In 1991, the HRA adopted a gradual "phase-out policy". Since the HRA bought the building in 1990, the number of tenants has decreased from eight (full occupancy) to four. At the end of 1991, revenues exceeded expenditures by $47,000. In 1992, revenues dropped to $8,888, because three major tenants left (Norge Village, Metz Bakery, and Rapit Printing) . The 1993 projected balance is a deficit of $8, 130. Current Status A number of issues are important for the HRA's decision: 1. Four out of the eight rental bays are occupied. Two of the four tenants have recently indicated a desire to leave by September 1, 1993. Arland Breyer, President of Cinnamon Skin Tans, will be present at the HRA meeting to discuss breaking the lease with the HRA to occupy another building in Fridley. My Sister's Closet/Bargains, Bargains is also seeking new tenant space and has indicated verbally that they would like to vacate the building by September 1, 1993. 2. Cinnamon Skin Tans has a lease through December 31, 1993, and My Sister's Closet is on a month to month lease. If Cinnamon Skin Tans is permitted to leave for September 1, 1993, the operating deficit for Rice Plaza would be $14,090. 6 8.2 Discuss Status of Rice Plaza July 1, 1993 Page 2 Staff had advised Mr. Breyer that we would not consider a September 1 vacancy date, although we would consider a November 1 vacancy date in order to minimize our losses. My Sister's Closet is on a month to month lease and can vacate with 30 days' notice. The operating deficit for an 11/1 vacancy would be $12,530. Again, if all tenants remain in the building, our original project of a deficit of $8,000 appears to be on target. 3 . The Hong Kong Kitchen lease expires at the end of October 1993. After this point in time, all leases, except Cinnamon Skin Tans, are on a month to month lease and the HRA could give a 30 day notice to vacate. 4. The filing deadline to request the County to have the property become tax exempt is July 1. Therefore, if the building is demolished at the end of 1993 or in 1994, the HRA is still responsible for the 1994 taxes (1993 taxes are $30, 574) . 5. In March of 1992, Darrel Clark obtained a demolition estimate of about $25,000 to remove the building. We believe that number is still accurate. 6. The HRA's carrying cost for the property would amount to the taxes, plus the cost to plow the parking lot during the winter to provide access to the Dairy Queen and to mow the lawn to the rear of the parcel. Approximate maintenance costs are $2,000. Again, after 1994, the carrying costs would simply be the mowing and plowing, because we would obtain tax exemption for the parcel. 7. It should also be remembered that the calculations for the operating revenues and expenditures for Rice Plaza do not contain any type of amortization for the original acquisition price of $1 million. The property tax is the largest expense for the building. This year will be the first year that the revenues from the tenants will not be able to retire all of the costs necessary to keep the property at a break-even point. 8. If Cinnamon Skin Tans and My Sister's Closet vacate, staff recommends that the HRA not proceed with the driveway improvement to the rear of the building. We 8.3 Discuss Status of Rice Plaza July 1, 1993 Page 3 had recommended this improvement at the May meeting because of the conflict between the drive-through traffic and the tenant traffic in front of the building. This would be a savings of about $4,000-5,000. If only two tenants remain in the building this fall, the traffic conflicts are minimal. Recommendation At this point in time, no direct discussion with any of the tenants has occurred regarding demolition and relocation of the tenants. Despite the outcome of Cinnamon Skin Tans, by January 1, 1994, it is very likely that only two tenants will remain in the building. Staff recommends the following: 1. The property manager, Jim Kordiak, should be directed to contact all the tenants about the HRA's intent to demolish the building in January 1994. The tenants should be interviewed as to their business plans and ability to relocate to another location. The tenants should be told that they must relocate no later than February 1, 1994. If there are any problems from any of the tenants, there is sufficient time to deal with these problems before the anticipated demolition date. 2. The HRA should direct staff to withhold the driveway improvements to the rear of the Rice Plaza building. 3. After all tenants have vacated the building, staff should be directed to take bids for demolition of the building. 4. After demolition is completed, staff should be directed to file the necessary applications to request tax exemption on the property. BD:ls M-93-389 BA June 23, 1993 City of Fridley HRA Fridley, Minnesota 55432 RE: 248 Mississippi Street Dear HRA: Cinnamin Skins/T's Hair Plus at 248 Mississippi Street would like to terminate our lease effective September 1, 1993. We have an opportunity to relocate in Fridley where we will be able to keep our business afloat. Due to this years road construction and the decrease in parking availability including the Dairy Queen drive thru, our business revenue had dropped approximately 45%. We feel the current location has poor HVAC and is in dire need of renovating which would cost a considerable amount of money to do. We have also heard rumors to the effect that the building will be demolished in the spring of 1994 which will leave us without a place of business. We would appreciate if you would expedite a response to this request. If you have any questions, please feel free to contact me at 631-2581. Sincerely, Arland F. Breyer, Pres dent LA Ventures, Inc dba Cinnamin Skins/T's Hair Plus 8.5FP-MX 1993 RICE PLAZA ANALYSIS 74-17bee I TVIcKeT-T 1. "Gradual Phase-Out" option selected September 1992. 2. Projected balance for 1992 was $9,598.00 based on five out of eight bays rented 3. 1992 actual balance is: $46, 612 .50 Rent payments - 29,119. 37 Taxes - 4, 605.49 Maintenance/Management fees - 4, 000.00 Insurance $ 8,887. 64 4. 1993 projected balance is: $31,044 . 00 Rent payments 4, 600. 00 Maintenance 4,000.00 Insurance 30,574 .00 Taxes ($8,130. 00) 5. Hong Kong Kitchen lease expires October 31, 1993 . 6. Cinnamon Skin Tan lease (under new ownership) expires December 31, 1993 . 1 I I 0 U I I I I 8.6 HOUSING & REDEVELOPMENT AUTHORITY MTG. , SEPT. 10, 1992 PAGE 5 MOTION by Mr. Prairie, seconded by Mr. Meyer, to approve check registers dated August 6 and September 10, 1992, as presented. UPON A VOICE VOTE, ALL VOTING AYE, VICE-CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 5. REVISED PARKING LEASE BETWEEN HRA AND COLUMBIA PARK I. . PROPERTIES: Ms. Dacy stated that Jim Hoeft wanted the HRA to know that he and the attorney for Columbia Park Properties are still working on a 11 revised. parking lease. There have been a number of Leases and documents pertaining to this property, so the intent is to combine . everything into one document. When the document is completed, it will be signed by the Chairperson and Executive director. 4(6. RICE PLAZA UPDATE: - !,y Ms. Dacy. stated that when staff and the HRA. were reviewing the 1992 budget, they looked at Rice Plaza and the income versus the expenditures. At that time, there were only three vacant spaces . out of eight rental spaces. At the end of 1991, balance of revenues minus expenditures equalled an excess of about $47, 000. Ms. Dacy stated that last year the HRA discussed three options: 1. Existing status,- with tenant improvements (abo',t $15, 000) • _ 2 . Demolishing the building in March 1992 • 3 . Gradual phase-out Ms. Dacy stated the option chosen at that time was option #3. About $2,500 was allocated in the budget for a trash enclosure- and sign improvements. Ms. Dacy stated that a number of tenants have now left the building. The most recent tenant, Rapit Printing, will he vacating effective October 1, 1992, and will be moving to the old Zantigo building on University Avenue. I Ms. Dacy .stated that five but of eight rental spaces are now vacant. One of the remaining three tenants, Hong Kong Kitchen,- is on a lease until October 1993 . The other two tenants, Cinnamon Skin Tan and Bargains, Bargains are on a. month-to-month basis. . Ms. Dacy stated that as compared to the 1991 balance or revenues minus expenditures of $47, 000, projecting the revenues sut to the 1 end of 1992 minus the expenditures, they will have a positive balance of about $9, 600. However, with only three spaces rented, 1 1 8.7 HOUSING & REDEVELOPMENT AUTHORITY MTG. , SEPT. 10, 1992 PAGE 6 by the end of 1993, the revenues minus expenditures will be a negative $16, 900. Ms. Dacy outlined the costs of comparing the three options (option #1 - Current tenants with improvement; option #2 - Demolish 1993 ; option #3 - Gradual phase-out. Based on Mr. Kordiak's opinion that he cannot re-lease any space without improving the appearance of the building and the HRA's discussion last year, option #1 really isn't an option. That leaves options #2 and #3 . If the HRA decides to demolish the building, they would probably have to break Hong Kong Kitchen's lease' and have to pay relocation expenses. Demolishing the building will cost about $25, 000 plus the normal operating expenses .plus taxes, so it will cost about $100, 000 to demolish the building. She stated - that with gradual phase-out option, while they don't have the demolition expense, they begin to lose money because of lack of tenants. . Ms. Dacy stated staff is recommending that the HRA not take any action on the building until the end of 1992 and see if any of the tenants can be relocated in the Fridley Town Square development. More information on that development should be forthcoming in the next one to two months. If the tenants do not relocate to Fridley Town Square, staff.recommends the HRA'strongly consider demolishing the building in 1993 . A potential time would be to do it in con- junction with the Mississippi Street improvement project by Anoka County next spring. Mr. Burns suggested the HRA wait to see what happens. If Hong Kong Kitchen does not break its lease, them maybe the HRA should wai€ to demolish the building . until October 1993 when the Hong Kong Kitchen lease expires. That way the HRA would not have to pay relocation expenses. • Ms. Schnabel stated staff's analysis appears to be very sound. She wou d agree wi r. s a HRA wait on any decisions to -see wha apb ens_ with the Fridley Town Square development and the current tenants Mr. Meyer and Mr. Prairie agreed. 7. - REQUEST BY TIM WERNER REGARDING LAKE POINTE SITE: 11[ Ms. Dacy stated Mr. Werner is running against Alice Johnson for State Representative. Because Mr. Werner believes the metro area should better pursue bus service, he has inquired as to whether or not the HRA would be willing to establish a park-and-ride site at the immediate intersection of Highway 65 and West Moore Lake Drive (where the bank, hotel, and restaurant buildings are proposed in the original Lake Pointe plan) . Mr. Werner has been calling her weekly regarding this issue. She stated she has told Mr. Werner that the HRA is looking at a lot of options for the Lake Pointe site. 1113 O`2'68111 11; Edward M.Tresk&Denson Manage,. f• no r oka 'ANOKA COUNTY ,w�OQau,00 TY2210an003 Aveakabnue e . STATEMENT OF PROPERTY TAXES PAYABLE IN 1993 Maaa..0 55303 323-5400 8'8 t+ j re c .. ` 1 ,<,`-'3 ,.._.... l -"c< " Yk .' PROPERTY DESCRIPTION T-I. 12` J/Llf)0 c c O i/ OWNER FRIDLEY HRA � SYLVAN HILLS PLAT 7 ft 6431 UNIV AVE NE LOT 1 'J FRIDLEY, MN 55432 BLOCK 1 t 7A • Pit, I /Cat. Property Class: 111 COMM-IND COMM-IND 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 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 11 Is Reduced By The State 3.Your property tax before reduction by state paid aids and credits 51678.80 53252.18 f 4.Aid paid by the State of Minnesota to reduce your property tax 22559.43 22677.60 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 29119.37 .tub/4.bti ' 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 21162.35 20310.38 108.Fiscal Disparity Tax 7957.02 9654.29 11.Voter approved Referenda Levies 0.00 609.91� 12.Total property taxes before special assessments 29119.37 30574.58 13.Special assessments added to this tax bill 0.00 0.00 14.Your total property tax and special assessments 29119.37 30574.58 15.Pay this amount no later than May 15,1993 15287.29 - _ 16.Pay this amount no later than October 15,1993 15287.29 .tSECOND4 Cv 1 'r .,, istRt,fax -, glPsarestalslax a. ,g1Mr-.11, .3 - .. e., .:*Le�k.:,;" ..: ' Lit '1- � s+^shy ". ? f 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 0058 NA PIN: R14 30 24 32 0058 NA - MAKE CHECKS PAYABLE TO ANOKA COUNTY MAKE camas PAYABLE TO ANOKA COUNTY 2100 3N Avenue,Anoka,MN 55303 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 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 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 AI-1PR form when applying for a refund PROPERTYVALUATIORNOTICE.IIS:OFJANUARY219931. PIN' R14 30 24 32 0058 1993 MKT/VAL PAY 1994 579,600 City: FRIDLEY Property Class: COMM-IND LOCAL BOARD OF REVIEW FRIDLEY HRA FRIDLEY CIVIC CENTER COUNTY ASSESSOR 323 5479 06431 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 TIVOIZAI---Z100.50T . s 8.9 1 C D >., 8rn8occCO La ev NI` N- O N F �- f� in T 8888LQi N- N- louiopT Cd or Z: co CO O N N CV 3 N. to N (r) to - CV N Li- N Q �y-�1 ' ad j 8 8 8 8 n W :Y .• In gil _O r CC f\ O 0 CV co cyj 0 0 IC 0 N W. to co » r. �? O Zr) M Q M Q Qco CO r «.c 0) Co r CV in co 3 1: (2• 1"- f- f- CV .c CV CV ` 11- C « •- to c . :» co v o <.<:: f- ppCfl C) to o ai of ai =< Co oO O Co to y corn 0) Y '. f . N. N. n •r O CVU _ '� N O N ?; M to o >` v Y ;.>:::i: cV to c X X .. ::::al ,i:io88p88 ") N O . _ w t W Eif O � �Op O O LO fCo . ui 6 v i t- co o f` to C') .3 N ., N w c LL:: CC C� 0 t as o :;:_::: d' CO v s c c E > fA t` 'n 3 t I- ::::.::::. o :iN W U i i2 c 1= :i::. trl O : CO 8Ch 0) C t UL En toN :> CO n e7 C9: N- O O 1- a a c y occ ow c w o 0 co Q 0) 1 N CV N o 2 i Y § H a7:: f� c o a to 0 c Ts .5 :. c .o L LL OC c N 1"- 13 :::':::::: Z 0 ::; ` Cr) f Y _ _ = qZ .. of IYFU- � 4Z • W v < Q Y Z CC Q F- a O : :::;: = Q Q O Q rn Y ; >:: UOI- m2 0 q �~` zZzcnO O F a 0)Z:: tr ( Q CC = W cH` � ZZcccc O W ai U 1 [ 2 O _ Q E— I— } Q `: U = Umco LL .#t * ti 9.1 / Community Development Department PLANNING DIVISION City of Fridley DATE: June 21, 1993 TO: • William Burns, City Manager FROM: VBarbara Dacy, Community Development Director SUBJECT: Interested Party at Lake Pointe Site John Ryden from CB Commercial contacted me on Wednesday, June 16, 1993 about an interest from Multi Tech Systems to relocate its headquarters from the Moundsview Business Park to approximately ten acres of the Lake Pointe site. Multi Tech would build a one story, 70,000 square foot building with a portion of it as a two story office complex. Multi Tech Systems manufactures modems. Ryden advised that there could be a potential of a 30,000 square foot expansion for a total of 100,000 square feet. Although Ryden couldn't confirm the exact number of employees, Multi Tech Systems probably employs anywhere between 50 - 100 employees. Multi Tech is looking for a high-tech image site rather than the typical manufacturing/warehouse industrial park appearance. I advised Ryden of the HRA and City Council discussion in May. I told him that I thought that this proposal is not consistent with the vision that the HRA and City Council have for the property; however, I would advise them of this interest in the case that I may be mistaken. Let me know if you need further information. BD/dn M-93-358 9.2 COMMENTS FROM HRA/COUNCIL WORK SESSION SATU R DAY. MAY 8, 1993 1. Bill Tobin, the consultant, began the meeting by asking each participant what his/her expectations were for the meeting. In general, the participants agreed that they expected the meeting to identify acceptable uses for Lake Pointe and to arrive at some conclusions as to how we can accomplish those uses and create goals related to those uses. 2. HRA Chairperson Larry Commers indicated he expected the meeting to produce a plan and a strategy for the implementation of a plan. 3. Mayor Nee indicated that he wanted us to confirm or modify our broad goal for the property. In other words, he wants us to review and reach consensus on development choices. 4. Councilmember Dennis Schneider said that he believes that market forces will determine what we do. He wants to see if what is out in the market is acceptable. He wants us to be able to respond to opportunities that arise in the market place. 5. Councilmember Nancy Jorgenson said that she does not want to see a K- Mart or Menard's development in that area. She wants quality development that remains consistent with what we told the neighborhood. She likes the hotel/conference center approach and wants us to focus on the north metro area as a market place. 6. HRA member Virginia Schnabel said she would like to leave the meeting with a plan of development. She thinks we should be open to looking at different alternatives other than those included in the original vision of the property. 7. Councilmember Steve Billings said that he had no preconceived notion or expectation about the meeting. He said that he is concerned as a council member who inherited the site as it is in his ward. He pointed out that if we come up with a plan different from the original idea, he will need to .discuss it with the neighborhood. 8. HRA member Duane Prairie said that he sees us sharing information at the meeting and updating and finding out what is available in the marketplace today. He said that our original goals were very high; however, he does not want to lower the goals too much. 9. HRA member John Meyer said he wants Bill Tobin to tell us what is marketable for the site. � r , 9.3 10. We then discussed background data on the site. I presented information on the land area and various land use actions that had occurred, including zoning and planning actions. I also talked about utility locations and planned intersection improvements. In addition, I addressed the extent to which the City's comprehensive plan and the modified development plan had bearing on the Lake Pointe site. 11. Barbara Dacy presented her material outlining the carrying costs for the Lake Point site. There was considerable discussion regarding the carrying costs for the site. 12. Councilmember Nancy Jorgenson said she wants the costs laid out in a cash flow format. She would like to see in detail what we are paying for each year. • 13. Bill Tobin then led a discussion of what was expected for the site and what the goals were. 14. Bill Tobin said that today's real estate market is dead. He said that the banking and investment community offer limited opportunities. Credit is starting to loosen up in some areas. He said that there is not a lot of sales activity, and buildings that are selling are selling at dramatic discounts that are below replacement costs. 15. Bill Tobin then described the Northwest Business Campus at the intersection of Highway 55 and 1-494. He said it was a combined North Memorial/Abbott Northwestern project offering core medical services and supporting medical services. The site sold for$3 per foot, and the acreage is 38 acres which is similar to the Lake Pointe site. He said that the plan density is around 750,000 square feet, which is similar to our proposed density for the Lake Pointe site. 16. He said that gambling and medical are the two segments of the economy that seem to be alive right now. Medical, however, is on hold until it is known what the Clinton administration is going to do with health insurance and the health care industry. 17. He indicated that the Northwest Business Campus is owned by Prudential and is being marketed by a broker. The broker, however, did not find Abbott Northwestern. Abbott simply walked in and bought it. 18. We then went into a discussion on the strengths and weaknesses of the Lake Pointe site. Among the strengths identified were transportation, highway access, location, visibility, Fridley schools, presence of a large number of headquarters/companies in Fridley, low taxes and utility rates, and employment base. 2 9.4 19. The weaknesses identified for the site were the perception of the area and the metropolitan area as a whole. It was also pointed out that this is a poorer multi-tenant market and the site offers poor proximity to the airport. 20. With respect to specific objectives for the site, Councilmember Nancy Jorgenson said that the most important thing for her is that she wants to change the perception of the north metro area. 21. With respect to financial objectives, Councilmember Nancy Jorgenson said that we should break even on the site. 22. HRA Chairperson Larry Commers said he would like to develop the site as a corporate headquarters site, and long-term, he would like to break even, at least by the time tax increment district has expired. He said he is not concerned about maximizing the density on the site, as long as it gets the quality of development he would like to see. 23. With respect to timing, Councilmember Nancy Jorgenson said she would like to see something done in two years. HRA member John Meyer said that was unrealistic. HRA member Duane Prairie said we need a five-year plan. Mayor Nee said he would like to see 25 percent of the land used in five years (that means about 10 acres). Councilmember Dennis Schneider indicated a strong preference for having Medtronic develop the property. 24. HRA member Virginia Schnabel said we need to develop a strategy for selling the site--under what circumstances and with whom will the cost be written down, and how much of the cost will be written down for different users. 25. HRA member John Meyer said that we should sweeten the pot to get Medtronic to develop the land. 26. Councilmember Steve Billings said that we need to think beyond Medtronic. 27. Councilmember Nancy Jorgenson suggested putting together a marketing piece including a video for the site. 28. Councilmember Steve Billings said that if we want to break even, we need to get two to three 100,000 square foot buildings in the near future. 29. Councilmembers Steve Billings and Dennis Schneider indicated a willingness to give away large parcels of land for a commitment to a 100,000 square foot building now. 3 9.5 30. HRA Chairperson Larry Commers indicated that he does not like the location and site of the Wedgewood Business Center. He said it is one- story project that is spread out on the site. He said he would like to hold out for a "signature" type of deal. (By that I assume he means the corporate headquarter's type of deal. 31. HRA member Virginia Schnabel said she thinks we should share our focus with people. 32. Bill Tobin indicated that he thinks we should dress up the intersection. The entrance to the property also needs to be upgraded. He also thinks we should renew the MPCA permit and if possible, get natural gas to the site. 33. The group agreed that they do not like the one-story, high tech manufacturing buildings. They said they are willing to hold out two to five years in order to get our ideal. 34. HRA Chairperson Larry Commers wants us to revise our cash flow analysis for the HRA and factor in costs of intersection improvements. 35. Councilmember Dennis Schneider suggested separating the intersection improvements that need to be done to improve the marketability of the site from those that are necessary for traffic congestion and the mediation of air pollution. 36. The group agreed that they want us to do the type of things now to get the site ready for use, such as the natural gas hook up, modified intersection improvements, acquisition of the two properties, and acquisition of MPCA indirect source permits. 37. Bill Tobin thinks that we should send a marketing brochure and letter to ten to twelve companies. He said we should help plant the seed for future building. He said they probably will not build now, but by contacting them and advertising with them at this point, we will plant the seed that the site is available when they are ready to build. He said that we should do some further exploration of the medical campus concept. 38. Mayor Nee suggested that we send a promotional piece to brokers and pursue an open listing of the property. 39. Bill Tobin said we need a single market brochure with different cover letters written to appeal to the different industrial targets. 40. He said that with respect to brokers, we could do it on a very personal basis and invite five or so brokers to breakfast every month. 4 • 9.6 41. Councilmember Nancy Jorgenson said that she wants us to address Duane Flatten's problems on the east side Highway 65 intersection. She said she thinks Flatten wants out of the agreement with the City. He does not want to keep up the property as he had agreed to. She thinks at the very least, we should clean it up and spray for weeds. 42. Councilmember Steve Billings thinks we need signs on the property. He • would like a big 16' x 16' sign in the middle, and a 4'x 8' sign at the entrance, letting people know that the property is a development site and not a park. 43. We ended the meeting by summarizing our conclusions: A. We should not be ready to abandon the corporate headquarters vision for the Lake Pointe site. The idea of having one-story, high tech manufacturing campus similar to the Northwest Business Campus was rejected at this point in time. B. We have been asked to prepare a marketing brochure and letters hat would be directed toward the twenty-five major corporations in Minnesota, or at least a very large number of corporations in Minnesota that have been identified by standard industrial code. C. We have been asked to send a letter and a brochure to area real estate brokers and to pursue an open listing approach to marketing the property. D. We have been asked to do a number of things that will help us get the property ready for immediate use. E. They suggested that we at least look into acquiring the two option properties on the north side of West Moore Lake Drive. The group also suggested that we renew the MPCA permit. F. They suggested that we have Minnegasco hook up the site to natural gas. G. It has been suggested that we investigate the possibility of doing some of the intersection improvements and that we create some sort jr_ of a monument at the entrance to the site to make it more noticeable. , Nt It has been suggested that we put some signs out on the property itself that are visible from the highway. I. We need to conduct some more specific research on the medical sector. 5 » . . 9.7 44. Before the meeting ended, we briefly discussed the compromise arrangement reached with Don Fitch for the acquisition of the Dairy Queen site with respect to the development of the 10,000 Auto Parts site. Everyone agreed that we should give Mr. Fitch an additional $35,000 for the Dairy Queen site. It was also recognized that Mr. Fitch's $200,000 would become part of the investment in the development of the 10,000 Auto Parts site. Mr. Fitch has agreed to ask for no relocation costs and no additional interest on the amount that has already been awarded. He has also agreed that the $35,000 additional stipend will be included as part of the City's equity in the Fridley Town Square project and that a total of$335,000 will be used in applying to the future equity participation agreement. 45. The meeting ended at approximately 12:30 p.m. 46. The following individuals attended the meeting: Mayor William Nee, Councilmember-at-Large Nancy J. Jorgenson, Councilmember Steve Billings, Councilmember Dennis Schneider, HRA Chairperson Larry Commers, HRA member Virginia Schnabel, HRA member John Meyer, HRA member Duane Prairie, and HRA member Jim McFarland, Barbara Dacy and William Burns (staff), Jim Casserly and Bill Tobin (consultants). 6 w- + / Community Development Department \ HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 1, 1993 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Status on All Temp Expansion Project At the April 8, 1993, meeting, the Executive Director presented a request by All Temp for tax increment financing assistance for expansion of the existing All Temp facility at 5400 Main Street. All Temp is awaiting a final decision from a potential tenant for freezer space within the existing building. If the tenant agrees to occupy the facility, All Temp intends to expand the building 60, 000-70, 000 square feet for additional space for another potential tenant. Mr. John Holman from All Temp contacted Jim Casserly this week and notified him that he is still awaiting a decision from potential tenants. The necessary legislation to initiate a tax increment district may be presented at the August 1993 meeting. No action is needed on this item at this time. BD:ls M-93-386 00 10.2 N c �'� 'S ausING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 17 O G 0 co 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 project. The project can legally be funded through TIF and an Economic Development Tax Increment District could be created. If they 10.3 HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 8, 1993 PAGE 1 (:::!/! 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, Lavonn Cooper Recording Secret Y CI Community Development Department E:\ HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 2, 1993 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Tax Increment Financing Request from Victor Rosenblum On July 1, 1993, I received the attached packet from Bridgewater Financial Group which represents Victor Rosenblum, a president of a plating company interested in locating a 29,000 square foot facility in the Great Northern Industrial Park at 51st Way and Industrial Boulevard (southeast of East River Road and I-694) . Because the information was received just prior to publishing the HRA agenda for July 8, staff has not had time to properly analyze the request. Prior to the July 8 meeting, we will conduct a preliminary analysis for a verbal report to the HRA. This should be discussed after the regular agenda items. BD:ls M-93-395 BRIDGEWATER . FINANCIAL GROUP June 30, 1993 Ms. Barbara Dacy Planning Coordinator City of Fridley 6431 University Avenue N.E. Fridley, Minnesota 55432 RE: VICTOR ROSENBLUM Dear Barbara: Attached please find the Tax Increment Financing application regarding the above- referenced project. I would appreciate it if you would-review this information and let me know your feelings regarding the feasibility of this financing request. Please give me a call if you have any questions. Sincerely, BRIDGEWATER FINANCIAL GROUP, INC. . , 1 -eib-r Deborah L. Gustafson President DLG/tlb Enc. 4205 Lancaster Lane North• Suite 1000• Minneapolis,MN 55441• (612)550-9030• (800)642-6258• (612)550-9221 FAX APPLICATION FORM FOR TAY INCR +MEN'n FTNANC±NG Business Name: To Be Determined Address: xxxx 51st Way, Fridley, Minnesota 55432 Type (Partnership, etc.) : Corporation Representative: Victor Rosenblum Telephone: 645-0787 Name of Counsel Steve Rutzig Name_and Telephone of Accountant: Sandy Brody 227-8441 List of Financial References: Name/Address/Contact/Telephone Liberty Bank - St. Paul, Minnesota Tim Macke 646-8681 Other Comments Pertinent to Your Application: This will be a spin-off of the St. Paul location. Have You Ever Filed for Bankruptcy? If Yes, provide details on seprate sheet No x Have You Ever Defaulted on any Loan Commitment? Yes If Yes, provide details on separate --sheet No X ORP'LATION CONC�u*rr*JG APP Ire PROPOSED PRO.TEf'Z' Location of Proposed Development: (Attach a Drawing) The corner of 51st Way and Industrial Boulevard Nature of Proposed Business: Plating Job Shop • Principal Business or Product of the Company? Plating Is the Proposed Project a New Facility or Rehabilitation and/or Expansion of Existing Facility? New Facility _. Industrial/Commercial/Residential: Industrial What is the Present Employment of Your Firm: 80 at existing location • What is Your Estimate of Employment One Year After Completion of Project: 30 - at new location What is Your Estimate of Employment Five Years After Completion of Project: 80 - at new location Total Estimated Project Cost: $2.25 Million Total Estimated Construction Costs: $1 Million Potential Other IIse(s) of Proposed Development: The development will- be a 29.000 square foot office/production that could be used for many other purposes. Will this Development Attract Other Related Industries: Yes X No How? Other manufacturers need plating facilities in the area. What Types? Machine shops, manufacturers - What is the Current Zoning Status of the Project Site? Industrial In Rezoning, will Zoning Variances or Conditional Use Permits be Required in Connection with the Project? -2- r • Is the Property Properly Y Subdivided for the Proposed Use? Yes Has Site Approval been Obtained for this Project? Yes If So, When? May 18, 1993 By Planning Commission? By City Council? Have You Applied for Conventional Financing for the Project? • •:Yes x Nb If Yes, Provide Details on Separate Sheet, "H. Information to Attach" If No, Why Not? INFORMATION TO ATTAC1 Please include: State Public Purpose Description of Project _ Schematic Drawing of Project Breakdown of Project Costs Amount of Subsidy Request Construction Schedule Legal Description - (Include PIN's) Other Pertinent Information Deposit -3- y • EXHIBIT A PUBLIC PURPOSE ..• .Gv.i....vv�y r.>}'t•: .AT'i•t•i;';',,.-rfi}. .. ...Y:.. :..4..:'.+�'..�::.-b.v�'':.,`•o..rF.Or.r}i.:`.r..:,::•::•:Cx:::r:::-:..vi.:..::r...ir:.:::...:i:..:::.:.:::..::•.:.:r..:..�.i.:.'.::r..:::.:.::.i.::.s.:r:...::r•.r4::::.�:::::::Writ:•}rr`:•r:;CT»:-ir:•r::.. ii!2:: '•":v3�.:.•:x•: i-.•Yr..:/.:T.r}v�w .:.i%v;:F4n 4rqf.••.�7r.i 4 v • ti v }i This project will bring a $2,250,000 investment into the City of Fridley. The project will involve approximately $1,250,000 in real estate and $1,000,000 in equipment. In addition, the project will generate 30 new jobs initially and up to 80 jobs within five years. These will be new jobs,. not jobs relocated from another facility. Also, this project will generate approximately $60,000 in property taxes on an annual basis. Due to the large investment associated with this project it would not be feasible without the assistance of Tax Increment Financing. . . • EXHIBIT B DESCRIPTION OF PROJECT :.MGM.. _ r:•{r • :.}Ylt{•:?8}:•}::.^C4:{nn•+}. :J T.y qq,- •3}. •?...• •.L {ih`. .•4 y•. x<?.r}:{.• r. .: 1.; .:.. ... .. .... A.'.'::.--:.i:::::::.'rii:;ii:}v::i4}iii}}i:}}}.::}:Si i':i;{!:.: +vr+�•}i}?i3>s" M1''}'ti •.....} .,.,v. v.. :.:x:? Y r ,.. .;: {.vr. :{i:{rv:.t{v i:: .' ::. .......... .6•.{}::-niiiY::i::iin:•....;$:.;.rr....}v4{Xf.•... 1... .i y� �";�[v�,j',,y'', r:.�> h..:;}i�.}:isi:'ism''i'J:t:i?iTi::}:}}ii}i}:::.i?T:?fi:•isi{iiiiT::i:::i::i:•'•}::'?i{{:-i:in•.•.:::.v. .:n•Y•�•.O� R' la4iv?f•'k32t:j�{f,�:,' ��S�a �f {. 'v�}ff.{}v..v iri'!'•}:r44..Y;if•' { v.}r.i.•istii`�::L:v:}isrvi:�:`•is�iii:isiii:�:�?::i`i:�i:-}::i::i:ti�:}�:ii:�i:�ii:ijii:-:�{{ii�}isi:}::i?{4:,i?•iti�::�u{::i:�v`. ..A f This project will include the purchase of approximately 4.75 acres on the corner of 51st Way and Industrial Boulevard in Fridley. The company is proposing to construct a 29,000 square foot office/production facility in addition to the purchase of approximately $1,000,000 of equipment. EXHIBIT C SCHEMATIC DRAWING OF THE PROJECT • ... :Ak•}J-'::v.}i: '4:{'i:;vir:.t;'"'....v.:.... :nw::.i-?:i-:.vr:f.fii}i::-}:}:..:1-i Mi ..... ..... �.. Q[}: •::••.-"::{:}•::M.{}:fvl v."v.'\:::n.•:._:::is is•.'...: -v ••\0,.�•.�.tix.. . Y: {•, •.W ...�. .:.K.,tp..\::::::'::'•:?•:.::::....::.h\}.i{::;:'•i•:!k':':iiii{:l:}Yir 4 L�rh'Jjt.�'6,':�iy: • v:'L..:..•. .n:}:•}:i4:}ii:{}:w:n:• ;.:�::;::c•'�':i::}::;.x.:..::::::.:....::.�:::::::{r:}:•xt•:t::r•:}::i:>:::•}:•}::::;,N•.c{•::.•.r.....� ,{:::{}.}. ,^.2.:::c:....::..:.:r`:-::}:•}}:•::.>}:-}:it•::::r.-::`:i;:>:;:tis:::::ir:`::•}>::•:}}::i::.:i:: : .;X•: •tea �.,� �{ v� y•h %gR:r• w :•}n:;.:::-:,}•t::::}rt•}:.}:-}:.r>::-xi•}:•::•::> :•::<• ::::}::}•: ..::::•::.a:.:.,.fa'���«i'�' w.{...ctfK"G3 • ., A•.},•'`.�¢ .•AW0049K• •: 4.S�Gm'{•:G'WO��h�:t•: vN�k-.A•::v:•:v.�.v3nJx:::.v-::::.�:::::.�xx....:........n.n.....:::.{-:::iiri}:i:.::Y::::iiiC This information is not yet available. • EXHIBIT D BREAKDOWN OF PROJECT COSTS .w.ti.:.x...::::::::.x:nwxi::vyv.: -:.x.}:}:-}:}:: ':";}`:}:.::;:;:::::::::}-:::..:}:?i:i..•: /v`.":":s?":.:< ..•?nK}:•Si}.....:...... .....:?• ��v^v';t•%Y' .:?}.�:i.`::+C:i:..}"..}i.`}".vn.,...:......::n::...........n......}.::n....:}:o:_:.}w::::::a9:x.'v:::.v.:.x•v :.::v • `n ;/.`55��"ea&ko .•:s cif•:?::.vr�'i>.Li:::iii4}�::v:4i:}i;:::iii::.v :°:iiiii:::4}}}:-}:�:???4}}}}:v':i:}:iii`i::r}'}:?:?•}:}:4{•}}:?n:•}:•}:;i}:-0}:?�:•:: ..}::1. ..........:.......:::::::::::r:.w:::•.J.:?-.vv:nuv:{•}}:-}}::??}}iFk Y4:Y::r�}•i•:-:4r{Oiv }fiivi}`i}n:GQ:.R fib The preliminary breakdown of project costs is as follows: Land Acquisition $ 250,000 Building Construction 1,000,000 1,000.000 Equipment Purchase TOTAL $2,250,000 a EXHIBIT E AMOUNT OF SUBSIDY REQUEST ru:v^-.x<c:....v.;.tox.:t,.:i::cry.F::n,;::`:;.::.':::uA::::=:;:`:;;::to-^af•<al�+.x.;:<•c:. r•+•c�`F, t�.,,. ':fiN4 .<?i , may• p.tw::t•:;5:;;x$:,•;.:. ?tii�S:;r:::::::.:'-�2•'::.:, y' +§'+<,.y. :..•':' :. ::t.>:`:au•`:::ki�y•%�>:'l.9.`ta#'t�c++:;;.,+;;.+'uc - a .tt +�• :•xo:•yt::t .:..}., ...:..� ...• •• :. ::�,.,:w•atw.•.ut:aato:i;>:::aa:-;:ao:::atta:.::r»:n:::a:.. ............. The company is requesting assistance in the amount of $125,000. EXHIBIT F CONSTRUCTION SCHEDULE �:vy:j!::"i^i.:i:::i.}w?': i :}:i.v:::i:::ii :+:ii}}i}}:•}ii}}:..}::v-: in\;nv..x v xx. 'iS�•:t•.v.{v +' Sr. ..\ \n AS+^vv.{:.}:i`^:"::.::::is}i:i:.»}:.}iY:::nv:.igi:: n::::{i.} }k'�v . a _ y ��. .... � ::::vi(:'isi4;.}:•}:}}}}::•}}};:iiTisu�:i�iii:J}i}}}}:i•:i-}}:i::�i:i^:4Y'.ii'�"vvv:':'}:.... y:..\ .v} .'nv v;:r v:`titi�{-::�i$:: :..•} .i.h..r :\'• i:•.\:'}vr< Yv i•: •vNv `2� Y A. ..vf?4'ryvv.. f'in.... .: � ''����_ iy.•:::::::.v:::w:::.v?.::6:5.}:viv}i":.::i••ii:!in:•iii:::4:i4}i'-:i 4i:•n4 v.}h}::.}iii`O:iivv.J:.... .....•w`'3C +.+a$ i�OS:iiv'::riSi?:i;:i%i-:::i�Sii?::::}�?-'i:':::iij::;i::�4(:j::ii:i?iiri::iii ii�>tiii'ri i:;:;;iY:i:i•}i::L}::::{.}:ni:: x?i? +}:: ....v.....v::::nv:::n\Yvv�-:%n�-.•'•'l:W m: +fAD Construction is expected to start in mid-September, 1993 and the construction period is expected to be approximately 120 days. . EXHIBIT G LEGAL DESCRIPTION Lot 1, Block 5 - Grant Northern Industrial Center PIN# 27-30-24-12-0002 EXHIBIT H �r`.t''��"' °�.�c•.•:::>t�'m'.k.....rc.�,.x�, �ac .y,�;:s«M}�:ts...: :,{.}y,,-h'ttt<4:<::..,y;sw.:. r-...ti.. : .v:.t Q.�}v �: :7h. N}}}:i}ii:"L}}:hi'•i}':}}}i::}:'•: :}4.......v.. :•}:M}v�i:.. \:::uv:.• 4v::...vrr'•.v...,.:v-..}}v.: .,,�'{•'.•'•::}}:-.v..�v'�2t•:v'-v:•-:vi. .• .: -'i. n •... :ii}+k•}:n:':: 4.. vn\.......\::.}:{t.A. :•�t::::i'Yliiixn3': ::v4gT w:X v:i... ::::w}:;; irf-.}r}.:4.��.•.C�m..�. :v}F.}::::w..�.�}::kF}:-}:;.,w:::::v..:. hv,.:t-'F}ivR.h.rn:........ :34:.:n};}}`C+ :`v"•M.4.v.:::}v F.v. : {:•:vi:{. .}•:r4•.v. ..f$$.}},.{.•.�:.•.v{•..r}4.}}:4::.v}:A¢:....:::.v} r.::•v:v.•v. .}.�•:•::$•vv ':. .....rv:::::.....:..rxr:}}:bi tn:4}:vv.:....n...:..:}.:.v•....v .... •:•v y}{.;r{.,ti::::.`.}::.}•{{y.4:...h:x::::.xi.::..v:::.v::::::::::t•:-:.}::.}v::.:.ri:•:Fi}}:i::::::::::.v::.::v:v:::x......:..............:::::rv.Y.............:�':• ' m �a�:cx�'c'S•'•i.'::E:hv`'�Cd':.i:`}7 r:�.- ;:,y c. < -kFs:c-c{sk`;t;:v:.'•.:t-•4}}}}:4}}}s ..,.y'�'''.h:4F}}•.:y..:.:s�{vvt Cv'ivh imvnv yy�� v:}.. ¢'::4':-i:ivi'::�ii::}�:i:::iiitj yi::::'::i-i'4:}:r4i:':}'•. ...4x.:�tlivx•.tivvv:lxm:/.•.n:}i}:Li}}isF:i::v'::�-...�:':'i:-}:'::: �v{}hi;: :.:\.::.44.:k:f%.}�.O•:': ��J� . :.vn::?:iv:v}}}}:isi:-.F}::v::4}nt-}xxir.-.{w.{yw::.vtv}.Fw. .vv,.wwy�vSs-•Y• 1. The company is in the process of applying for a Small Business Administration loan for the primary financing for the project. 2. Mr. Rosenbium's existing company has been in business for over 40 years and has been a very successful operation. 3. The average payroll for the new employees will be $12.00 per hour. u p I Community Development Department PLANNING DIVISION City of Fridley DATE: July 1, 1993 TO: William Burns, City Manager ill FROM: ✓Barbara Dacy, Community Development Director Grant Fernelius, Housing Coordinator SUBJECT: Reuse of Property at 5720 Polk Street N.E. ACCAP has notified us that they would not be interested in rehabilitating the existing structure and relocating it on the property. The cost to accomplish this option is too excessive. We are therefore recommending that the City proceed to demolish the existing structure. Demolition costs will be reimbursed by MSAS monies. Grant Fernelius and I have discussed two options regarding reuse of the property: 1. ACCAP's typical policy is to request cities to donate the property for construction of a new home. ACCAP has indicated that a house on this particular lot would be valued between $65,000 - $80,000. ACCAP has indicated a willingness to buy the property from the City at 50% of its market value which is consistent with ACCAP's policy of purchasing tax forfeit lots from Anoka County. If ACCAP were to purchase the property, the City would probably receive $12, 300 since the land value on the property is $24,600. ACCAP would then construct a home on the property in the immediate future. They have also indicated a willingness to work with the City on screening from Moore Lake Apartments as well as details about the type of structure. ACCAP notes that despite the value on the home, it would still meet the first time home buyer or affordable housing objective. 2. The second option is based on a scattered-site development model by the City of Richfield. We would package this vacant lot plus the vacant lot at Broad Avenue and Lafayette Street, and possibly two or three other lots scattered in the community and negotiate with a builder to purchase the lots and construct homes on the properties. The type of home and • Reuse of Property at 5720 Polk Street N.E. July 1, 1993 Page 2 value could be specified with the builder and a mutually beneficial purchase price could be negotiated. The sales from the four or five lots, potentially $20,000 each or $100, 000 total, could be coupled with the $100,000 scattered-site acquisition budget from the HRA and could be used to purchase blighted properties within neighborhoods. The Community Development Department is currently compiling a list of "blighted properties" which would be eligible for this type of acquisition. An example of a property would be the Erickson property on Ely Street. While this option is very appealing, the City Council should be aware that it will take six to eight months to develop this program given our other program priorities for the single family rehabilitation, multiple family rehabilitation, and rental licensing projects. Also, we have not solicited any type of interest from the building community, so we do not know if the Richfield model would work in the City of Fridley. Meanwhile, the City would continue to be responsible for maintaining the vacant lot at 5720 Polk Street N.E. Recommendation Staff recommends that the City Council authorize us to pursue Option #2 to develop a scattered-site lot sale program in order to generate funds to eliminate blighted properties. Further, staff will proceed to have the Branco home demolished the week of July 7, 1993. BD/dn M-93-384 . • flr7 Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 7, 1993 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Develo pment Director SUBJECT: Request for HRA Funding of Wetland Consultant Study Background In the spring of 1992 during preparation of the City's 1993 General Fund budget, staff determined that it was necessary to hire a consultant to inventory the City's wetlands. The consultant contract is necessary because of the passage of the Wetland Conservation Act of 1991 by the State Legislature. • We also knew that sane sites located in tax increment districts would be affected by this law. Two examples are the loopback parcel in the southeast corner of 73rd Avenue and University Avenue which was established as Tax Increment District No. 10 and properties in the vicinity of 81st Avenue and Main Street and now Tax Increment District No. 3. Because of the impact on potential developments in tax increment district parcels, it was discussed that the cost of the study could be divided between the public Works Department and the Housing & Redevelopment Authority. Proposal Request for proposals were mailed to six environmental consultants last month, and four responded. The lowest cost and the best proposal was submitted by Westwood Professional Services, Inc., and Peterson Environmental Consulting, Inc. The contract cost is $7,990. Approximately two-thirds, or $6,000, will be paid through the City's General Fund. It is requested that the HRA authorize up to $1,990 from the "non program studies" line item of the 1993 budget. The 1993 budget allocated $28,000 for non programmed studies. Recommendation Staff rends that the BRA authorize an expenditure not to exceed $1,990 to be used for a portion of the wetland consultant contract with Westwood Professional Serviops and Peterson Environmental. BD:ls M-93-402 r t