HRA 01/17/1995 JOINT - 6289A
JOINT
CITY COUNCIL WORK SESSION
AND
HOUSING & REDEVELOPMENT AUTHORITY MEETING
MONDAY, JULY 179 1995
6:30 P.M.
WILLIAM BURNS
EXECUTIVE DIRECTOR OF HRA
CITY OF FRIDLEY
AGENDA
JOINT
CITY COUNCIL WORK SESSION
AND
HOUSING & REDEVELOPMENT AUTHORITY MEETING
MONDAY, JULY 17, 1995 6:30 P.M.
Location: Meeting Room I (Lower Level)
CALL TO ORDER
ROLL CALL
1. Presentation by Potential Developers 1 - 1 G
A. United Properties (6:45 pm - 7:25 pm) A
B. MEPC (7:30 pm - 8:10 pm) B
C. Galbreath (8:15 pm - 8:55 pm) C
B R E A K
2. Evaluation of Developers and Selection of Successful Company (9:00 pm - 9:45 pm) 2 - 2B
3.
Consideration of Density and Street Location Issues and Impact on Cost of
3-3S
Southwest Quadrant (9:45 pm -10:15 pm)
4.
Consider Acquisition of 380 - 57th Place for Transitional Housing Services, and
4 - 4P
Consider Management Agreement with ACCAP to Manage and Operate Transitional
Housing Services (10:15 pm - 10:45 pm)
CONSENT ITEMS FOR HRA:
1.
Approval of Minutes: June 8, 1995
2.
Authorize Acquisition of 5924 - 2nd Street N.E.
2 - 2B
3.
Establish public hearing for disposition of Lot 4, Block 1, Scherer Addition
3 - 3E
4.
Consider amendment to contract with Whitney Homes
4 - 4D
5.
Service contract with ACCAP for administration of HOME rehabilitation program
5 - 5N
6.
Monthly housing report
6 - 6A
7.
Revenue and Expenses
7 - 7D
ADJOURNMENT
r.
MEMORANDUM
® Municipal Center
6431 University Avenue N.E. Office of the City Manager
F
Fridley, MN 55432
William W. Burns
CITYOF (612) 571 -3450
FRI DLEY
TO: The Honorable Mayor and City Council
Fridley Housing and Redevelopment Authority Members
FROM: William W. Burris, City Manager
DATE: July 13, 1995
SUBJECT: Joint Meeting -Monday, July 17, 1995
MEETING SCHEDULE
There is a CounciUHRA meeting scheduled for Monday, July 17, 1995, at 6:30 p.m., in the
meeting rooms on the lower level of the Municipal Center. As you can tell from the attached
agenda, we will have a busy evening. I am hoping that we can conclude the meeting by
11:00 p.m. While I realize that you have very busy schedules, if it is possible for you to be
at the meeting by 6:30 p.m., it will help us to stay on schedule.
ISSUES TO BE RESOLVED
There are several main issues to be resolved at the meeting on Monday night. One of the
most important is the choice of developer for the Lake Pointe site. We also need to resolve
the following Southwest Quadrant issues so that we can proceed with the redevelopment of
this site:
1. We need to discuss the density issue. In addressing the density issue, we are
faced with one of three choices:
A. Spend an additional $1 million to build the 48 owner- occupied
condominiums that were originally planned.
B. Substitute about 26 attached townhomes for the 48 condominiums.
C. Substitute an 80 unit market rate senior high rise for the 48
condominiums.
1
Joint Meeting
July 13, 1995
Page Two
2. We need to discuss access issues for the Southwest Quadrant.
A. Configuration of the main access road.
B. Whether we comply with the County's requirement for construction of
additional lanes on Mississippi Street.
There are other HRA items that should be addressed separately by the HRA, including
consideration of ownership of the fourplex located at 57th Street.
MATERIALS
Attached are materials related to the Lake Point development project, including:
1. Copy of the Lake Pointe development proposals submitted by the three
developers.
2. Copy of staffs evaluation matrix for the proposals.
3. Copy of a letter sent to the three potential developers.
4. I have also prepared an evaluation matrix that you may use when evaluating
the three proposals. Please note that we will not be going through a formal
scoring process.
If you have any questions or would like additional materials, please contact either Barbara
Dacy (572 -3590) or myself (572- 3500). 1 look forward to seeing all of you on Monday
evening.
Thank you for your cooperation.
.I_:
1A
61
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FRIDLEY MUNICIPAL CENTER . 6431 UNIVERSITY AVE. N.E. FRIDLEY: MN 55432 • (612)571- 3450- F-AX (612) 571 -1287
June 29, 1995
Mr. David M. Jellison..
MEPC American Properties Inc.
1550 Utica Avenue South
Suite 120
Minneapolis, MN 55416
Dear Dave:
Thank you for your interest in our Lake Pointe site. As I indicated to you on the telephone,
we have decided to ask representatives of your company and the other companies that have
submitted Lake Pointe development proposals to make presentations before a combined
meeting of the Fridley City Council and the Fridley Housing and Redevelopment Authority
(HRA) on July 17, 1995, at the Fridley Municipal Center. The meeting will begin at 6:30
p.m. in the meeting rooms located on the lower level of the Municipal Center.
If you are interested in participating, you should briefly describe your company and the
resources it is willing to apply toward the development of the Lake Pointe site. As part of
this, you should describe the principals who would be involved in marketing and developing
the site and any expectations you would have of the City and the HRA. In general, however,
you are free to do what you think is necessary to make the most convincing case for choosing
your company.
In order to facilitate the evaluation process, staff will be providing members of the City
Council and the HRA with evaluation criteria. These criteria are likely to include the
following items:
1. Your company's ability to finance projects.
2. Your approach to marketing and planning.
H f-
Mr. David M. Jellison
June 29, 1995
Page 2
r
3. Your access to potential tenants and users.
4. Consistency of your development goals with the objectives of the City.
5. Your marketing strength.
6. Your development experience.
7. Your commitment to the north metropolitan area.
8. Your anticipated time frame for marketing and development.
9. The extent to which you require the financial participation of the City in the
marketing process.
10. The extent to which your presentation falls within our time limits.
In the interest of fairness, Barbara Dacy and I have randomly selected times for presentations
to be made by the representatives of the three companies. They are as follows:
6:45 - 7:25 p.m. United Properties
7:30 - 8:10 p.m. MEPC
8:15 - 8:55 p.m. The Galbreath Company
Since we have a very busy schedule for that evening, we would like to ask that you keep your
presentation to twenty (20) minutes in length. We would also like to allow another twenty
(20) minutes for questions and answers. While it is not real hospitable to ask you to leave
after your presentation, we believe that this process will probably work better that way.
Finally, we will be making copies of your proposals for each of the members of the City
Council and the HRA. If you have other materials that you would like to forward to them
prior to the meeting, please get them to us by noon on July 12, 1995.
1C
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Mr. David M. Jellison
June 29, 1995
Page 3
Thank you again for your interest in our project. No matter which company we ultimately
select, I believe that we are very .fortunate in having high quality firms and individuals as
participants in our process.
Sincerely,
164-V
William W. Burns
City Manager
AR
c: Ms. Leslie H. Jowett, RPA
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June 29, 1995
Mr. William Burns
City Manager
City of Fridley
6431 University Ave. N.E.
Fridley, MN 554324383
Dear Bill:
Per our recent conversation, you asked me about the experience the City of St. Louis Park has
had in dealing with MEPC as a developer.
MEPC is currently the largest taxpayer in St., Louis Park and has developed and operated the
Minneapolis West Business Park with a variety of office, industrial and retail uses.
Please understand that any comments I make are not to be construed as an endorsement of MEPC
for development projects under consideration in Fridley but merely represent the experience that I
have had either directly or indirectly in dealings in St. Louis Park.
I have found MEPC to be an outstanding property owner and developer in all respects. They have
developed only the highest quality development and have then maintained their property in an
exemplary condition. Their business dean s have been straijht forward and honest and they have
been very cooperative in complying with all City requirements. They often seem every bit as much
interested in seeing surrounding property develop appropriately as does the City. MEPC has been
a corporate contributor to the community with their time, talent and treasury. I believe that St.
Louis Park has always felt comfortable that any project they develop will be successful.
I hope my input has been helpful.
Sincerely,
K rlesW. e Y er
City Manager
5005 Minnetonka Boulevard St. Louis Park, Minnesota 55416 -2290
Phone: 612-924-25001 612- 924 -2663
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Minnesota Rea[ EstateJonrnal Page 9
fight a 96,000 square foot
)roperty in Brooklyn Park
or $26.04 per square foot.
7316 Aspen Lane, is 87
o four tenants. With this
ndustrial now owns more
square feet of industrial
vin Cities market.
chase is a 75,000 square
rial property in Madison
'or $1,995,000, or $26.60
That building is 100 Per-
e tenant.
isactions bring the REIT's
3roperties totaling 21 mil -
n 13 states.
OPMENT
- is in land
1 the UofM
- The Minneapolis Com-
)ment Agency (MCDA)
t dispute between the Uni-
!esota and St.Paul -based
- who gets a 30 -acre tract
South East Minneapolis
) area.
of the MCDA says the
help the two parties come
before a scheduled court
lace July 19, 20 and 21.
e Minneapolis City Coun-
M's proposal to develop
feet of office/warehouse
tys. The site is located in
ner of the 300 -acre SEMI,
*enue and 17th Avenue.
ear, CSM has had a pur-
e with the owner of the
)rthwestern Railroad.
J of M has decided to use
inent domain to take the
- eports. The University
the site to either develop
housing, athletic fields or
tm generating power plant
s alongside the Mississip-
says.
vice president of CSM,
.r has been talking with a
ial users for the industrial
sclined to say who they
the land value is.
has been working with
tax increment financing
L The site will need soil
ollution remediation due
railyard. Most of the pol-
sel fuel, Carland reports.
-- 80%
64 60%
C
MI
r 40%
20%
0%
Occupancy and Average Rate
Fourth Quarter by Region
Region
■ Occupancy ■ Average Rate
Galbreath
from page 1
had enough product to last 10 years,
but Hoeg got me to come up and the
market just blew me away," says Rick
Stone, who supervises the western half
of Galbreath's offices out of Denver.
Stone says the firm will consider specu-
lative industrial development and office
development anchored by significant
preleasing.
Galbreath had spent the last several
months looking at other ways of enter-
ing the market, including purchasing
office properties with turnaround poten-
tial. Sources say a Galbreath partnership
put in the second highest bid on Mid-
west Plaza in downtown Minneapolis,
and was close to purchasing 605 Water-
ford in Plymouth.
Purchasing a building would provide
Galbreath with a quick way into the fee
management business, where much of the
firm's national growth has been in recent
years. Galbreath, which manages close to
90 million square feet nationally, would
like to have a Twin Cities portfolio of up
to 5 million square feet in the next three
years, Stone says. He says he envisions the
Minnetonka office eventually employing
up to 10 professionals.
For now, however, the firm's duties will
be split between Hoeg, who will supervise
development and management for Gal-
breath, and Scholz, who will head up the
company's corporate consulting business.
"The market, from a developer's stand-
point, has had a kind of void since Tram-
mell Crow left," says Mark Brill of Brent-
wood Commercial, "and they are formida-
ble builders who do a nice project. But as
far as consulting and management, they are
going to be a new player in a busy market"
J
14 o
June 21, 1995
Mr. William W. Burns
City Manager
City of Fridley
6431 University Avenue NE
Fridley, MN 55432
Subject: Lake Pointe
Fridley, Minnesota
Dear Bill:
On behalf of United Properties, I want to thank you for giving us the opportunity this week to be
considered for the development of Lake Pointe.
We understand the City's goals for Lake Pointe to be as follows:
1. Sell land for appropriate development, consistent with an approved Master Development
Plan, custom designed for this major entrance to the City of Fridley.
2. Select an experienced developer who will make Lake Pointe its highest priority.
We believe that United Properties is ideally suited for this project for the following reasons:
• We are a local real estate company. Our development and marketing focus is in the Twin
Cities.
• Established in 1916, United Properties is also one of the largest full- service real estate
companies in the Twin Cities. We have over 220 employees, and therefore, have the
necessary resources to successfully develop Lake Pointe.
• United Properties is an experienced developer with a proven track record, having
developed over 3 million square feet of office and industrial space locally. We are also
very experienced business park developers:
Mendota Heights Business Park - Mendota Heights 210 acres
Parkers Lake Corporate Center - Plymouth
55 acres
Centennial Lakes - Edina
100 acres
Minnetonka Corporate Center - Minnetonka
100 acres
Burnhaven - Burnsville
1,200 acres
Lake Elmo Business Park - Lake Elmo
125 acres
Southbank - Phoenix, AZ
300 acres
3500 West 80th Street Minneapolis, Minnesota 55431 612 831 -1000 Fax: 612 893 -8804
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..:.... .... .,
._
June 21, 1995
Mr. William W. Burns
City of Fridley
Page 2
• United Properties is one of the leading Build -To -Suit developers in the Twin Cities.
Build -To -Suit projects could be an important . element of the overall Lake Pointe
development.
• United Properties is a very successful land marketing company. We will expose Lake
Pointe for sale to user companies, brokers. and other developers.
• United Properties has extensive experience working on behalf of third -party land owners,
such as Prudential and Minnesota Mutual Life. We understand results -based performance.
• United Properties is also a real estate marketing company with 30 licensed leasing brokers,
14 of which specialize in office space leasing. We will assign two of our brokers, with
primary marketing responsibilities, to Lake Pointe. In addition, Lake Pointe will be
exposed to the entire United Properties brokerage staff. All United Properties brokers
cooperate with outside brokers. This gives the City a broad network of coverage in the
market.
• Our Corporate - Real Estate Services group has established relationships with major
Minnesota companies, providing a variety of real estate services. Many of those
companies are located in Fridley and surrounding north - suburban communities. We
expect that some of the development will involve this select group of companies.
Success at Lake Pointe will largely require a strong, coordinated marketing effort to execute a
Master Development Plan. We propose the following plan, as a basis for an eventual
Development Agreement with Fridley.
A. Development
1. Planning - we will hire Robert L. Boland, Inc., St. Louis, Missouri, to prepare the
Master Development Plan for Lake Pointe. United Properties will pay this cost.
2.
Overall development of Lake Pointe could total between 500,000 SF to over
1,000,000 SF of eventual construction.
Collateral Materials - United Properties will develop marketing tools for
development projects and potential land sales. United Properties will pay the cost of
these related to actual development projects that it initiates. The City will reimburse
us for costs specifically related to land marketing, subject to a pre- approved budget
ssion of actual invoices.
June 21, 1995
Mr. William W. Burns
City of Fridley
Page 3
3. Speculative Office Project - we will design an office building for lease, in
accordance with the approved Master Development Plan. United Properties will
purchase the site for this project and commence construction subject to achieving
70% pre - leasing, and/or as required by financing terms.
Two United Properties leasing brokers will be assigned exclusive marketing
responsibility for this project, exposing the project to the entire market, including
prospective tenants and to the Twin Cities brokerage community.
Flexibility is the key. Lake Pointe offers the chance to develop a variety of building
sizes, which provides the market the flexibility of choice, and thereby quickens the
development of Lake Pointe based on actual pre - leasing results.
4. Build- To-Suit Projects - United Properties will market Lake Pointe to user
companies, on a sale or lease basis. We will purchase sites upon entering Build -To-
Suit contracts for specific corporate facility projects.
B. Land Marketing
1. United Properties will market sites at Lake Pointe for sale to corporate users, brokers
and developers. We will manage the sale process on behalf of the City. Any
proposed development would be coordinated with the approved Master Development
Plan. Land prices will be pre - determined with the City for each site and will be
reviewed annually thereafter.
2. United Properties will be compensated a commission for all land sales at Lake Pointe,
including projects developed by United Properties. An 8% sales commission will be
paid to United Properties. United Properties will compensate any participating
outside broker involved in individual transactions.
C. Land Management Services
1. United Properties can also provide the City additional real estate services, such as
accounting, street and utility design and construction, market analysistcustom reports,
real estate tax analysis, and soil correction coordination. Any such services will be
paid by the City on an hourly basis.
D. Exclusive Right to Develoa /Sell
1. The development agreement will be for a three year minimum term, extended
automatically in one year increments.
t -t _,*,.
T.
June 21, 1995
Mr. William W. Burns
City of Fridley
Page 4
If this outline of terms is acceptable, we will work with the City to prepare a mutually acceptable
Development Agreement.
We believe that Lake Pointe is an outstanding development opportunity for the "front door" of
the City of Fridley. Because of its proven track record with similar projects, we believe that
United Properties is best suited to market Lake Pointe for development and act as the project
developer on behalf of the City of Fridley. With the right development plan, and aggressive
marketing strategies,-we are confident that United Properties can successfully develop Lake
Pointe.
Thank you for considering United Properties for this exciting development marketing opportunity.
Very truly yours,
4VI�Z��
Dale J. Glowa
Senior Vice President
DJG /dgw
cc: Brian Carey
Jeff Lafavre
adAe*Wypmdoc
el�' P
PROPOSAL
To
The City of Fridley
Developer of Record Proposal
For
Lake Pointe Corporate Office Park
-4
MEPC AMERICAN PROPERTIES INC.
June 9, 1995
MEPC AMERICAN PROPERTIES INC.
MEPC American Properties Inc. is a wholly -owned subsidiary of London -based MEPC plc,
one of the worid's largest international property companies with more than $6 billion in
assets. During its 45 years of business, MEPC plc has acquired or developed more than
900 properties throughout the United Kingdom, Europe, Australia and the United States.
MPEC American was founded in 1974 and since that time has developed or acquired
commercial properties throughout the United States. Current projects include office
buildings, shopping centers and industrial buildings in Atlanta, Chicago, Dallas, Kansas
City, Las Vegas, Washington D.C. and Minneapolis and Rochester, Minnesota.
Like the parent company, MEPC American maintains ownership and management of each
of its projects.
June 9, 1995
Proposal to the City of Fridley
Developer of Record Proposal
For
Lake Pointe Corporate Office Park
Parties: City of Fridley /MEPC American Properties Inc.
Project: Lake Pointe Corporate Office Park
Location: I -694 and Central Avenue
Fridley, Minnesota
Present Owner: City of Fridley
Developer: MEPC American Properties Inc.
Acreage: Approximately 33 acres
Use: Office park and other related services
Commencement
& Term: MEPC proposes to be designated the Developer of Record
commencing September 1, 1995 (or sooner) and to continue
this designation through December 31, 1997.
Renewal Term: We would also like to request upon mutual consent of both
parties this term could be renewed for an additional three
(3) year period.
Developers
Responsibilities: MEPC American Properties shall be responsible for all
costs associated with the marketing and development of
Lake Pointe Corporate Office Park. We would propose a
marketing plan as follows:
A - Establish office market data on this location and
determine the corporate users and amenities for space at
Lake Pointe Corporate Office Park.
vim
ti
Ii - Master plan Lake Pointe Corporate Office Park to
maximize the site and meet the requirements of the
corporate users (in building size, quality and floor plate) for
this location.
C - Develop marketing materials such as fliers and
brochures to assist in marketing efforts for mailings,
advertising, proposals to corporate users, broker parties,
press releases, etc. Scheduled timing of these marketing
events and materials would be provided to the City.
D - The official announcement to the public of Lake Pointe
Corporate Office Park would be achieved by:
Broker special event on site
News releases
Corporate user presentations
Prospect Mailings
Advertising throughout the Twin Cities
Owner's Responsibilities: The City of Fridley shall be responsible for the following:
Amending Cities original Indirect Source Permit
and associated Environmental Impact Statement
Furnish unencumbered land and or subsidize ramps
due to final density requirements.
Provide any necessary infrastructure changes due to
final site plan.
Resolution
r, , <y
DOUSING & REDE VELOPME NT AUTHORITY
Resolution
Commissioner
moved its adoption.
AND THE
CITY OF FRIDLEY
FRIDLEY, MINNESOTA
1995
introduced the following resolution and
RESOL UTION CONDITIONALL Y DESIGNA TING MEPC AMERICAN PROPERTIES
INC. AS DEVELOPER OF THE AREA AT THE INTERSECTION ON THE
NORTH SIDE OF INTERSTA TE 694 AND WEST SIDE OF HIGHWA Y 65
KNOWNAS LAKE POINTE CORPORATE OFFICE PARK.
WHEREAS, the Fridley Housing & Redevelopment Authority (hereinafter "HRA ") and
the City Council for the City of Fridley (hereinafter "City ") have approved this area for an
Office /Commercial Development Project;
WHEREAS, planning for development in the I- 694/Highway 65 area requires
cooperation with private developer(s) interested in making investments in the area;
WHEREAS, prior to contractually committing to developing the area, private developers
require time to plan and prepare for such development and in doing so make notable financial
commitments;
WHEREAS, MEPC American Properties Inc. (hereinafter "MEPC ") a worldwide
development company with its American headquarters in Dallas, Texas and a regional office in
Minneapolis, Minnesota*has shown interest in developing that portion of the I -695 & Highway
65 described above and;
WHEREAS, MEPC has requested from the HRA and the City a twenty -eight (28) month
time period during which it may have exclusive status as potential developer of the area
commonly known as Lake Point Corporate Office Park; and
WHEREAS, the I]RA and the City of Fridley have undertaken an active role to
encourage development of the Lake Point Corporate Office Park area through planning, purchase
of real property, relocation, soil correction, and environmental clean -up financed by tax
increment and other sources.
NOW, THEREFORE, BE IT RESOLVED, by the HRA and the City as follows:
1. MEPC is designated exclusive developer of the area north of 1 -694 and west of
Highway 65 depicted on the attached Exhibit A, for a term commencing September 1, 1995
through December 31, 1997.
2. MEPC will undertake planning, site design, marketing, and development efforts; all of
MEPC's plans and activities will be coordinated with the HRA and the City including but not
limited to all building, zoning and subdivision requirements; and MEPC understands that any
actual development must be preceded by a negotiated development agreement between the HRA
and the developer which development agreement shall contain terms satisfactory to the HRA.
3. In accordance with the objectives and authority of the Lake Pointe Corporate Office
Park plan, and Minnesota law, the HRA and the City have available various powers and financial
assistance tools to facilitate the development of the area. If the HRA and the City are satisfied as
to the site design, planning, marketing, financing, and development efforts of MEPC, the HRA
and the City are prepared to reasonably utilize its powers and financial assistance tools to
facilitate the establishment of a reasonable land price or subsidize ramps due to final density
requirements, and provide an environmental impact statement, indirect source permit and any
necessary infrastructure changes due to a final site plan.
4. The conditional designation is not contractually binding on the HRA and the City, but
is a statement of HRA and the City's willingness to work in good faith solely with MEPC until
December 31, 1997 unless MEPC fails to diligently pursue redevelopment efforts.
The following Commissioners voted in Favor:
The following Commissioners voted Against:
Chair
Attest:
Acting Executive Director
c
JUN 0 9 1995 M >'
T iZC ClableA Com.�a,rzy
12800 Whitewater Drive, Suite 170, Minnetonka, Minnesota 55343 TEL 612- 931 -2222 FAx 612- 931 -0996
June 8, 1995
Mr. William W. Burns
City Manager
City of Fridley
Municipal Center
6431 University Ave N.E.
Fridley, MN 55432
Dear Bill:
Please find enclosed the expanded introduction to the Phase I piece of our outline of
development services for The City of Fridley.
Thanks for opening your calendar to visit with Mike, Rick and me. We continue to be
excited about the possibility of working with you to catalyze the success of Lake Pointe.
Sincerely,
William K. Hoeg
Regional Senior Vice President
enclosure: Expanded Introduction to Phase I of June 3, 1995 outline
u1p\Bums.00F
A FULL SERVICE REAL ESTATE COMPANY
ATLANTA CHICAGO CINCINNATI CLEVELAND COLUMBUS DENVER FT. LAUDERDALE NEW JERSEY NEW YORK OAKLAND
ORLANDO PHILADELPHIA PITTSBURGH SACRAMENTO SAN FRANCISCO SAN JOSE STAMFORD WASHINGTON, D.C. LONDON MEXICO CITY
e. Process and Reporting
Phase I:
* We will implement a formal and systematic marketing program to access
tenants for Lake Pointe in the quickest manner possible. Our marketing will
include direct contact with:
*Decision Makers within Metro Area Businesses, including the 31
Fortune 500 Companies Based Locally
*Real Estate Brokers
*Economic Development Authorities
*Other Offices of The Galbreath Company
*Real Estate Lenders and Investors
*Real Estate Developers
* We will provide monthly written reports of our marketing and sales calls and
the status update of deals in progress.
* We will underwrite and execute the.first project at Lake Pointe with attention
being paid to the long term development issues of the Park.
Phase II:
* In concert with the final commitment for the first project at Lake Pointe we
hope to earn the right to become the developer of the Lake Pointe through
either the execution of a Development Contract or through an extension and
expansion of scope of our Phase I Development Services Contract.
* Phase II would include:
*An update of the City's goals and objectives for Lake Pointe.
*Land pricing
*Tax impacts
*Timing
*Funding programs, impacts
*Staffing
*Other
in
JUN 0 5 1995
T!Lz-
12800 Whitewater Drive, Suite 170, Minnetonka, Minnesota 55343 TEL 612 - 931 -2222 FAX 612 -931 -0996
June 3, 1995
Mr. William W. Burns
City Manager
City of Fridley
Municipal Center
6431 University Ave N.E.
Fridley, MN 55432
Dear Bill:
We consider it a privilege to have this opportunity to propose our capabilities for
representing The City of Fridley in developing Lake Pointe. The goal of developing
Lake Pointe in a re- emerging market is a responsibility for which we are confident that
we will be successful.
Attached are highlights of our proposal summarized in bullet -point format. In addition, I
have emphasized some of the local accomplishments of Mike Denny and me. Two key
attributes that may not be readily detected in our proposal are our commitment to and
enthusiasm for this opportunity - especially in light of this being The Galbreath
Company's first major visible project in Minnesota.
The Galbreath Company brings a tremendous array of talent and resources to this
assignment. We see our relationship with The City of Fridley as that of a business
partner. We want to maximize the land's tax value by successfully executing the
development potential while minimizing your risk for resource consumption, both in
terms of dollars and people.
Bill we appreciate the chance to work with you and are anxious to start work on Lake
Pointe immediately. Please feel free to call me directly at 931 -0688.
Sincerely,
Regional Senio� Vice President
enclosure: Bullet Point Summary of our proposal
u1p\Bw=2.00F
A FULL SERVICE REAL ESTATE COMPANY
ATLANTA CHICAGO CINCINNATI CLEVELAND COLUMBUS DENVER FT. LAUDERDALE NEW JERSEY NEW YORK OAKLAND
ORLANDO PHILADELPHIA PITTSBURGH SACRAMENTO SAN FRANCISCO SAN JOSE STAMFORD WASHINGTON, D.C. LONDON MEXICO CITY
T12.c��Gat�.C_r
Lake Pointe
City of Fridley
The Galbreath Company
The Best Choice
I. Goals and Objectives for Lake Pointe:
Secure a commitment with a credit worthy user to construct a three story or larger Class
A office building as quickly as possible, while setting the going forward framework for
maximizing density and maintaining the quality of a master planned business campus.
IL Why The Galbreath Company?
a. The Galbreath Company is one of the largest real estate companies in the world.
• Our Company was founded upon providing real estate services with integrity.
• We provide access to national and international deal flow
• The local operations are run by principals who have a primary stake in
the success of the local market.
• The Galbreath Company is the only full service real estate company in
the Twin Cities with an international scope.
• We have an internal merchant banking function which enables Galbreath
to successfully underwrite a wider band of credit amongst tenants resulting
in more deals being successfully being completed
• We have comprehensive development talent and resources within the
Company, including: finance, construction, master planning, architecture,
legal, property management, leasing, and asset management.
b. Lake Pointe will be The Galbreath Company's first major project in Minnesota.
• Importance of positive first impressions for Galbreath with the local
community.
• No conflict of interest. We will have a dedicated focus to Lake
Pointe's success.
* We are committed to Lake Pointe throughout the organization as evidenced
by having had the Vice Chairman come to Fridley three times within the
past 60 days to review Lake Pointe.
c. We are proposing a "partnering" type structure that provides for The City of Fridley
and Galbreath to have parallel objectives for Lake Pointe.
* An "owner's" perspective when dealing with prospects.
* A long term perspective versus a "brokerage" mentality.
* A developer's savvy when it comes to structuring the first deal to set the stage
for the long term success of the Park.
* Minimizing risk for the City by having a full disclosure relationship
with The Galbreath Company with mutually beneficial goals and objectives.
* A compensation format which is consistent with short and long term focus
for Lake Pointe
d. The enthusiasm, local experience and commitment of Will Hoeg and Mike Denny
to Lake Pointe.
* Lake Pointe has huge ramifications for Will Hoeg and Mike Denny because
the first impressions it will create for Galbreath within the local real estate,
finance, and general business community. Additionally, a project such as
Lake Pointe, will be tremendously positive for Hoeg's and Denny's image
within Galbreath.
* The deal flow that we have already generated for Lake Pointe on an informal
basis indicates the potential success of an exclusive relationship between the
parties.
* Our track record of developing master planned business parks in the Twin
Cities is excellent, we believe. Over the last ten years we have been involved
with over six million square feet of development, including Carlson Center,
Minnetonka Corporate Center, The Colonnade /Golden Hills Redevelopment,
Eagan Woods, Plymouth Business Center, Normandale Lake Office Park and
Minneapolis Industrial Park. We believe this depth of successful master
planned development experience provides us with the unique ability to
address all of Lake Pointe's needs.
* We believe that we have developed an excellent an open working chemistry
with staff members at The City of Fridley. This chemistry is critical to the
success of Lake Pointe.
F1
e. Process and Reporting
Phase I:
Secure a commitment with a credit worthy user to construct a three story or larger Class
A office building as quickly as possible, while setting the going forward framework for
maximizing density and maintaining the quality of a master planned business campus.
* We will implement a formal and systematic marketing program to access
tenants for Lake Pointe in the quickest manner possible. Our marketing will
include direct contact with:
*Decision Makers within Metro Area Businesses, including the 31
Fortune 500 Companies Based Locally
*Real Estate Brokers
*Economic Development Authorities
*Other Offices of The Galbreath Company
*Real Estate Lenders and Investors
*Real Estate Developers
* We will provide monthly written reports of our marketing and sales calls and
the status update of deals in progress.
* We will underwrite and execute the first project at Lake Pointe with attention
being paid to the long term development issues of the Park.
Phase II:
* In concert with the final commitment for the first project at Lake Pointe we
hope to earn the right to become the developer of the Lake Pointe through
either the execution of a Development Contract or through an extension and
expansion of scope of our Phase I Development Services Contract.
* Phase II would include:
*An update of the City's goals and objectives for Lake Pointe.
*Land pricing
*Tax impacts
*Timing
*Funding programs, impacts
*Staffing
*Other
• A comprehensive review of the master plan to identify and address the
then current market opportunities to maximize the potential of the site.
• A review and creation of a timeline for execution of transportation
issues including Highway 65 intersection improvements and the
renewal of the indirect source permit.
• The creation of The Lake Pointe Master Association which would
then create the Rules and Regulations for the Park, including:
*Building architectural review committee
*Signage program
*Landscaping program
*Lighting requirements
*Common area allocations
*Park cross easement language for items such as future parking
structures.
• An updated marketing plan.
• Final determination of public improvements
*Whose responsibility
*Which ones and when
These are the basic tenets from which we believe The Galbreath Company, with
Will Hoeg and Mike Denny as the point individuals, will be able to provide the City
of Fridley the best real estate service and execution for Lake Pointe.
u1p\DEVPKout.COF
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III. Fee Structure
We propose a contract for Phase I development services as follows:
• Initial term of eighteen months.
• Cancellation with cause at any time.
• Cancellation at the:City's sole discretion after nine months with
thirty days notice.
• Monthly retainer for the first twelve months paid as follows:
* $4000 per month in cash.
* $4000 per month accrued and paid at the end of twelve months,
unless contract is terminated for cause.
* Commission of $1.00 per rentable square foot of building area for
the first project, payable upon ground breaking.
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Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: July 14, 1995
TO: William Burns, Executive Director of the HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Southwest Quadrant: Density and Street Access
Issues
Density Issues
There are three options for consideration:
1. Maintain the 48 units of senior condominiums at an
additional cost to the HRA of $885,839.
2. Eliminate senior housing and add 24 additional units of
townhomes. There would be no additional cost to the HRA.
3. Substitute an 80 unit market rate senior apartment building
in place of the 48 condominiums. There is an additional
$277,073 required for this option.
A summary matrix entitled "Comparison of Senior Options" is
attached to compare the three options in terms of the project
density, the total project taxes, the taxes per unit, the total
project value, and the total additional cost to the HRA beyond
the original net budget cost of $2,400,000 (see attachment #1).
Staff does not recommend option #2 (all townhomes) because
eliminating the senior housing element from the redevelopment
plan would be contrary to the original intent of the project.
Further, it creates the lowest amount of value and taxes for the
project.
Option #1 creates the most amount of value ($14,409,000), but
creates the most amount of additional cost to the HRA at
$885,839. These costs can be reduced by reducing costs to the
developer via waiving the park dedication fees ($109,500) and
possibly waiving the Sewer Available Charge fees ($83,000). The
park fees and the SAC fees would have to be waived by the City
Council during the upcoming plat process. Despite these
additional costs, the existing HRA budget can assume the
Density and Street Access; Stonegate
July 14, 1995
Page 2
additional expenditures (see attachment #2).
Option #3 proposes 80 market rate senior units. Factored into
the financial analysis is approximately $78,000 of tax increment
assistance for 15 years. Option #3 produces the most amount of
annual taxes at $263,982. The project value is smaller than the
condominium option by about $412,855.
The decision becomes one of which priority the City Council and
the HRA would like to establish. If the priority is for an
owner- occupied unit which will create the most amount of value,
option #1 should be chosen. If the priority is to maximize the
number of units on the property and to create the most amount of
tax generation on an annual basis at the cheapest cost, then
option #3 should be- chosen.
In order for the project to proceed on a timely basis, one of
these options must be chosen so that the developer can finalize
the plans for final approval by the City Council.
Access Issues
There was a significant amount of discussion at the Planning
Commission meetings about where the proposed 3rd Street alignment
should be located. The Planning Commission recommended approval
of an alignment which proposes the street intersection 35 feet
east of the existing location of 3rd Street near the liquor
store. The Holly Center driveway would also be shifted 35 feet
to the east.
After Planning Commission consideration, Councilmember Billings
expressed concern about the configuration of the road into the
development. The City Council discussed this issue after its
June 26, 1995 meeting and directed staff to work with the
developer to develop an option such that the entrance into the
development does not look like it is a connection into the
neighborhood to the south. In other words, create an image that
the road serves only the development. After reviewing several
options with the developer, the developer is proposing to create
a barrier in the 3rd Street right -of -way just before intersecting
Satellite Lane. The barrier would force traffic needing to get
to Satellite Lane to use the private drives between the eight
unit townhomes. Fire lane access would still be provided for the
Fire Department (see attachment #3).
The barrier would consist of brick pavers raised to a slightly
higher elevation than the public street. It would also be
narrower than the street (20 feet), but protected by surmountable
curbing. Its design needs to be carefully planned, but it could
3A
Density and Street Access; Stonegate
July 14, 1995
Page 3
be designed so that it looks like it is part of the
pedestrian /trail system.
Staff recommends that the City analyze this approach more
closely.
Mississippi Street Improvements
Anoka County will not issue a permit for work in the Mississippi
Street right -of -way to shift the street intersection to the east
35 feet without completing a significant amount of improvements
to Mississippi Street (see attachment #4). The City Manager
directed me to prepare a staff recommendation for this issue. He
stated that if staff believed that Anoka County's recommendation
was "ginger bread ", then we should not make a professional
recommendation to the City Council and HRA to implement it;
however, if it has engineering merit, then, despite its cost, the
City should closely evaluate it.
An alternative to shifting the road intersection 35 feet to the
east is to simply maintain the existing location of the 3rd
Street intersection into Mississippi Street (see attachment #5).
An Anoka .County permit would not be required since no work would
be completed within the right -of -way, hence, there would be no
requirement for the improvement.
A summary matrix of the pros and cons of each of the options has
been prepared (see attachment #6). If the cost issue is
eliminated, the proposed alignment to shift the road 35 feet to
the east and realign the Holly Center driveway is the best
alternative. Although it is painful to recommend an alternative
which costs an additional $162,000, after evaluating the design,
it is the safest and anticipates future traffic needs.
Staff recommends that the proposed alignment to shift the road
intersection 35 feet to the east be constructed. Staff also
recommends that, to the extent possible, some type of cost
sharing proposal be worked out with Holly Center and Rottlund
Homes to minimize costs to the HRA.
Summary
1. The City Council and the HRA must choose one of three
options for the construction of senior housing in the
northeast corner of the site.
2. A carefully designed pavement barrier is recommended to be
studied for 3rd Street.
WT:-1
Density and Street Access; Stonegate
July 14, 1995
Page 4
3. Staff recommends the Stonegate plan propose construction of
3rd Street 35 feet to the east of the existing street
intersection and that design include realigning the driveway
for Holly Center.
BD /dw
M -95 -402
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COMPARISON OF "SENIOR" OPTIONS
e
OTHER OPTIONS TO REDUCE HRA COSTS:
1. Waive $109,500 Park Dedication Fees (City Council to determine)
2. Waive $83,000 SAC Fees (City Council to determine)
ATTACHMENT #1
3G
Option #1
Option #2
Option #3
------------------------=-------------------------
--------------------------------------------------
(Senior Condo)
(All Townhomes)
(Senior Rental)
Total Project Units
146
122
178
Density
10.4 units /acre
8.7 units /acre
12.7 units /acre
Total Project Taxes
$219,869
$204,303
$263,982
Taxes /Unit
$1,505.95
$1,675.61
$1,483.04
Total Project Value
$14,409,000
$13,041,000
$13,996,145
Total Additional Cost
($885,839)
($14,160)
($277,073)
to the HRA (beyond
original budget of
$2,400,000)
OTHER OPTIONS TO REDUCE HRA COSTS:
1. Waive $109,500 Park Dedication Fees (City Council to determine)
2. Waive $83,000 SAC Fees (City Council to determine)
ATTACHMENT #1
3G
612 334. 3382
CASSERLY MOLZAHN 841 P02 JUL 14195
t�9= 31
CITY OF FRIDLEY, MINNESOTA
E
SWQ PREPARED BY CASSERLY 3H N & ASSOCIATES, INC. 14 -JUI -9
OPTION 1 OPTION 2
OPTION 3
*REVENUE
LAND SALES
0 984,000
1,028,000
TAX INCREMENT
1,074,169 952,478
1,253,881
TOTAL_ REVENUE
1,074,169 1,936,478
2,281,881
*EXPENSES
TOTAL EXPENSES
- 4,360,008. 4,350,638
4,958,954
SURPLUS/(DEFICIT)
(3,285,839) (2,414,160)
(2,677,073)
* MARKET VALUE
SENIOR CONDOS
HOMESTEAD AMOUNT
81,000
UNITS
48
SENIOR RENTALS
NON - HOMESTEAD AMOUNT
43,439
UNITS
80
TOWNHOME UNITS
HOMESTEAD AMOUNT
90,000 90,000
90,000
UNITS (DETACHED 8 UNIT)
48 72
48
HOMESTEAD AMOUNT
130,500 130,500
130,500
UNITS (1 STORY)
26 26
26
HOMESTEAD AMOUNT
117,000 117,000
117,000
UNITS (2 STORY)
24 24
24
NON - HOMESTEAD AMOUNT
UNITS (REHAB)
TOTAL MARKET VALUE
14,409,000 13,041,000
13,996,145
*TAXES
219,869 204,303
263,982
* TOTAL NUMBER OF UNITS
146 122
178
OPTION 1:
14.0 ACRE - NEW CONSTRUCTION
146 UNITS
NO LAND PAYMENTS TO AUTHORITY
OPTION 2:
14.0 ACRE - NEW CONSTRUCTION
122 UNITS
NO SENIOR COMPONENT
OPTION 3:
14.0 ACRE - NEW CONSTRUCTION
178 UNITS
CLASS RATE FOR SENIOR RENTALS - 2.3%
DEFICIT INCLUDES PV OF ANNUAL T.I. REQUEST: $78,000
ASSUMES TAX EXEMPT BONDS AND TAX CREDITS
SWQ PREPARED BY CASSERLY 3H N & ASSOCIATES, INC. 14 -JUI -9
=0
'•612 334 3382
• 612-334-3382 CPSSERLY MOLZAHN 833 P03 JUL 13'95 10:23
CITY OF FRMLEY, MINNESOTA
SOURCES & USES STATEMENT - OPTION I
SOURCES:
TAX INCREMENT
LAND SALES
TOTAL SOURCES
USES:
ACQUISITION
RELOCATION
DEMOLITION
PUBLIC IMPROVEMENTS (ROAD CONSTRUCTION)
SITE IMPROVEMENTS (PAVEMENT REMOVAL)
ISSUANCEIDWOUNTIFINANCIAL/
LEGOWNEGATIVE ARBITRAGE
CONTINGENCY
TOTAL USES
SURPLUS/(DEFien)
1.074,169
. .0
2,836,968
486,600
247,174
275,000
49.710
7.WA OF TAX INCREMENT 75,192
10-00% OF USES 396,3"
4,3e0,008
PREPARED By CASSERLY MOLZAHN & ASSOCIATES. INC.
31
(3-285,09)
13- Jul -95
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612 334 3382
612-37,4----382 t OSSE.Jk LY MOL?AHN 841 P03 JUL 14'95 09:31
CITY OF FRIDLEY, MINNESOTA
SOURCES & USES STATEMENT - OPTION 2
SOURCES:
TAX INCREMENT
LAND SALES
TOTAL SOURCES
USES:
ACQUISITION
RELOCATION
DEMOLITION
PUBLIC IMPROVEMENTS (ROAD CONSTRUCTION)
SITE IMPROVEMENTS (PAVEMENT REMOVAL)
ISSUANCE /DISCOUNT /FINANCIAL/
LEGAL/NEGATIVE ARBITRAGE
CONTINGENCY
TOTAL USES
SURPLUS /(DEFICIT)
962,478
984,000
1,936,478
2,836,968
486,600
247,174
276,000
42,710
7.005/6 OF TAX INCREMENT 66,673
10.00% OF USES - 395,513
SW02 PREPARED BY CASSERLY MOLZAHN & ASSOCIATES, INC.
3s]
4,350,538
(2,414,160)
14- Jul -95
3wos
. ........ ... --------- ....... ....... . .............
61 4-:3381-2' Ci=�SSERL-Y NOLZAH" 833 P05 JUL- 1^195 10:24
CITY OF FRIDLEY, MINNESOTA
SOURCES & USES STATEMENT - OPTION 3
SOURCES:
TAX INCREMENT
LAND SALES
TOTAL SOURCES
USES:
TIF PAYMENTS
RELOCATION
ACQUISITION
DEMOLITION
PUBLIC IMPROVEMENTS (ROAD CONSTRUCTION)
SITE IMPROVEMENTS (PAVEMENT REMOVAL)
ISSUANCEMISCOUNWINANCIA14
LEGAL/NEGATIVE ARBITRAGE
CONTINGENCY
TOTAL USES
SURPLUS/(OEFICM
1,253,881
1,02%000
2,281,881
531,916
486,600
2.838,968
247,174
278.000
42,710
7.00% OF TAX INCREMENT 87,772
10.00% OF USES 450.814
4,9W,954
PREPARED BY CASSERLY MOLZAHN & ASSOCIATES, INC.
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PROJECTS
1995 1 2,400,000
1996 (Net) 525,000
1997
1998
1999
2000
2001 1,900,000
2002 pntersecdoni
2003
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Assumption: N.E. Quad will pay for itself.
(1) 150,000 Frank's Used Cars
88,000 Gunderson Home
10,670 Plaza Area Tree Replacement
10,000 Banners for Mississippi St
4,500 2 Spare DecordWe Lights
— 2,550 DO Taxes — Last year
$265,720
File :1123DATAIHRAITIFPR095 pROJECTs.wk1 2/1/95
Unked To: CASHFLOW.wki
265,720 2,665,720
199s
787 500 (1) 1,312,500
1996
826,875 826,875
1997
0
1998
0
1999
1,900,000
2000
0
2001
0
2002
0
2003
0
2004
0
2005
0
2006
0
2007
0
2008
0
2009
0
2010
0
2011
0
2012
0
2013
0
2014
3M i
k
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KASOTA
ATTACHMENT #3 i
30
��`
____
r,V CONC. MEDIAN Vf-
�
_
TTACHMENT #4
CSAH 6 RECONSTRUCTION PROJECT
$2.00 400
ROTTLUND /FRIDLEY
8800.00
Bit. Sawcut
82.00 260
81.50 230
PRELIMINARY COST ESTIMATE
$520.00
DESCRIPTION
COSTAINIT QUANTITY
UNIT
AMOUNT
CSAH 6
$1,000.00 1
87.00 • 500
LS
TON
81,000.00
Remove Conc C &G
82.00 1,250
LF
$2,500.00
Remove Pipe Sewer
$8.00 200
LF
$1,600.00
Remove Conc Walk
80.75 5,900
SF
$4,425.00
Bit. Sawcut
Remove Bit Pavement
$1.50. 1,060
SLQO 1;070
LF
SY
81,590.00
Remove Conc Driveway
.
810,00 90
.
SY
$1,070.00
Remove Brick Pavers
80.50 1,080
SF
.$900.00
$540.00
Remove Catchbasin Manhole
8200.00 3
EA
8600.00
Relocate Hydrant
$1,250.00 1
EA
$1,250.00
Common Excavation
$2.00 800
CY
$1,600.00
Traffic Control @ 10%
$8,000.00 1
LS
$8,000.00
Aggregate Base CI 5
Bit1°n)nous Pavement
$7.00 760
TON
$5,320.00
Conic C &G
635.00 280
$6:00 1,825
TON
LF
$9,800.00
Medan 3' Conc Walk
81.50 2,120
SF
$10,950.00
$3,180.00
Const CS Manhole
52,500.00 3
EA
$7,500.00
15' RCP Sewer
Striping
$22.00 200
LF
$4,400.00
Field Survey
$3,500.00 1
$2,435.00
LS
$3,500.00
1
LS
$2,435.00
Subtotal
$71,160.00
Contingency 15%
610,674.00
Eng & Admin
15%
$12,275.10
Total
$94,109.10
Streetscape Improvements
Ornamental Lighting
Turf Establishment
$4,200.00 3
EA
812,600.00
Brick Pavers
$2.00 600
83.00 2,120
SY
SF
$7.200.00
4' Conc Walk
81.50 4,600
SF
$6,360.00
$6,900.00
Subtotal
$27,060.00
Contingency 15%
$4,059.00
Eng & Admin 15%
54,667.85
Total
$35,786.85
Holly Shopping Center
Remove Cons C &G
Common Excavation
$2.00 400
LF
8800.00
Bit. Sawcut
82.00 260
81.50 230
CY
LF
$520.00
Remove Bit Pavement
Relocate Irrigation System
$1.00 1,450
SY
$345.00
$1,450.00
Aggregate Base CI 5
$1,000.00 1
87.00 • 500
LS
TON
81,000.00
Bituminous Pavement
835.00 270
TON
$3,500.00
89,450.00
Conc
Field Survey
$6.00 375
61,200.00
LF
$2,250.00
1
LS
$1,200.00
Subtotal
$20,515.00
Contingency 15%
$3,077.25
Eng & Admin
15%
83,538.84
Total $27,131.09
Stonegate
Common Excavation
Aggregate Base CI 5
$2.00 125.
CY
$250.00
Bituminous Pavement
$7.00 80
$35.00 50
TON
TON
$560.00
Cone C &G
3' Conc Walk
$6.00 180
LF
$1,750.00
81,080.00
81.50 200
SF
$300.00
Subtotal
63,940.00
Contingency
15%
8591.00
Eng & Admin
15%
8679.65
Total $5,210.65
Grand Total $162,237.69
174Aay -95 CSAH6.WK1
30
Page 1
I = S I RE 3rd St.
- -- -Entrance Option ---- - - - - --
- PMENT
PROPOSE STONEGATE DE
I
o �
#5 ;
PROS AND CONS OF STREET
INTERSECTION LOCATION
CONS
N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N
EXISTING * Eliminates cost of $162,238
ALIGNMENT I
* No Anoka County permit
* Skews intersection more to
prevent traffic from °cutting
through° development
* Area could be reserved for
future improvements
* Eliminates one detached town -
home unit
* Potential irritation to Anoka
County
* May have to pay cost of improv-
ing Mississippi Street in the future
* Skew of intersection is awkward
* Future HOA may request City to
pay
N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N
PROPOSED
ALIGNMENT BY
DEVELOPER
(35' EAST OF
EXISTING
ALIGNMENT)
* Improvements are completed
for potential long-term traffic control
* Meets safety and design criteria
established by the County
* Provides better parking design
on Holly Center site
* Adds cost to the redevelopment
project
* County refuses to help pay for
improvements
N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N N
What are the safety and design criteria accomplished by the proposed alignment?
1.
4
3.
Provides protected turn lanes into Holly Center and Stonegate with protective raised
medians.
Provides adequate through -lanes on either side of turn lanes.
Extends width/taper of eastbound lane along the front of RAO Manufacturing to permit better
traffic maneuverability.
ATTACHMENT #6
/3S
{� Community Development Department
D HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: July 13, 1995
TO: William Burns, Executive Director of the HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: HRA Ownership of Four Plex at 380 - 57th Place
N.E.-for Transitional.Housing
The HRA tabled action on this request at its June meeting. The
City Council and staff are recommending that the HRA own the four
plex and lease it to ACCAP for transitional housing services.
Background
In September of 1994, the City supported ACCAP's application for
MHFA funding to acquire and rehabilitate a four plex located at
380 - 57th Place N.E. for transitional housing services. At that
time, the HRA agreed to provide rehabilitation assistance up to
50% of the rehabilitation costs, or $25,000 (the assistance was
to be split between a loan and a deferred loan).
MHFA funded the project, but not out of the original
"transitional housing program ". The funding was awarded from a
different program entitled "Publicly Owned Transitional Housing
and Battered Women and Other Crime Victims Facility Program ".
ACCAP had requested approximately $142,000; $92,000 was for the
acquisition and $50,000 was for the rehabilitation costs. ACCAP
has recently informed me that because MHFA funded the application
out of the publicly owned account, more money exists in that
account so that HRA assistance is not necessary.
ACCAP has also received a preliminary estimate from an architect
regarding the rehabilitation. It is estimated that
rehabilitation costs will approximate $84,605. Coupled with the
$92,000 acquisition cost, there is a total project cost of
$176,605 which MHFA will finance.
The "public owner" would lease to ACCAP who in turn will contract
with Lutheran Social Services to provide the transitional housing
service.
HRA Ownership of Four Plex
July 13, 1995
Page 2
Previous Council Review
The City Council discussed this issue in November 1994 and in
March 1995. In the March memo, staff had recommended County
ownership. The City Council asked staff to determine if County
ownership would mandate City participation in a County levy.
Current Status
Tim Yantos confirmed that ownership would not automatically
dictate the levy. Both the HRA and the City Council would have
to pass a resolution stating that the City is willing to be
subject to a County tax levy. Another resolution would,be needed
to request the County to own the four plex.
Yantos also stated, however, that Commissioner McCarron was
concerned about a policy being developed where the County is
asked to perform a service, and then asked not to have an ability
to recover any costs for performing the service.
Anoka County staff in the meantime has made a.recommendation to
the County HRA that the four plex be owned by the City (see
letter from Jerry Soma, Interim Division Manager, dated May 16,
1995).
Policy Changes
Since discussion of this item, a number of issues regarding the
City's ability to provide affordable housing has been raised as a
result of the Southwest Quadrant redevelopment. Conversion of
the four plex from a general market apartment building to one
that is targeted for affordable households in conjunction with a
social service project constitutes an addition of four affordable
housing units. Combined with the 18 Hyde Park cooperative units,
the City has added 22 affordable units to the City's housing
stock in the last six months.
Further, ACCAP has proposed that it would be willing to take on
additional cost responsibilities for managing the four plex. The
proposed agreement is attached:
1. They will be responsible for all insurance costs for the
property (paragraph 14 of the agreement).
2. ACCAP will assume all operating costs plus maintenance and
equipment replacement (paragraph 2 of the agreement).
3. ACCAP will agree to pay the City's portion of the real
estate taxes (paragraph 6 of the agreement).
;a
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HRA Ownership of Four Plex
July 13, 1995
Page 3
4. ACCAP will make up the difference between the sale price of
the four plex and the original mortgage price if a forced
sale is dictated prior to the expiration of the 20 year
mortgage (paragraph 13 of the agreement).
5. ACCAP will act as a lead contact regarding any property
maintenance or neighborhood issues (no public hearing is
required).
The agreement is now being reviewed by Jim Hoeft. If there are
any substantive changes, those will be presented Monday evening.
RECOMMENDATION
Staff recommends that the Fridley HRA own the four plex.
Ownership would assist the City in meeting an affordable housing
goal, and secondly, the property management agreement seems to
resolve any financial, legal, or insurance risks. City ownership
would eliminate any question regarding the provision of County
services within the City and its implications for a future County
tax levy. Finally, there will be no costs to the HRA for the
project, other than administrative expenses.
BD /dw
M -95 -397
~N Cc,,
COUNTY OF ANOKA
HUMAN SERVICES DIVISION
ADMINISTRATION & FINANCE
GOVERNMENT CENTER • 2100 3RD AVENUE • ANOKA, MN 55303 -2264
ADMINISTRATION 612 -422 -7000 FAX: 612-422-6987
FINANCE 612 -422 -7092 FAX: 612-422-6988
May 16, 1995
Dr. William W. Burns, City Manager
City of Fridley
6431 University Avenue NE
Fridley, MN 55432
Dear Dr. Burns:
This letter is to express the support of the Anoka County Human Services Division for the use
of the four -plex located at 380 57th Place for transitional housing for families. There is a major
need in Anoka County for such housing. Our desire is that this house provide a stable, safe
environment for homeless families with children. We believe the housing and services provided
at this location will provide an appropriate response to families in crisis. Anoka County is
currently forced to place some homeless families in motel units until more suitable housing can
be located. While this can serve as an immediate response to the needs of a homeless family,
it is a poor approach for more than a night or two.
It is our understanding that the Minnesota Housing Finance Agency (MHFA) funding received
by the Anoka County Community Action Program (ACCAP) for the purchase and renovation of
this property can only be used if the property is transferred to public ownership. Since we are
interested in this property for use as transitional housing, we hope that this transfer of ownership
can occur. A municipal or county HRA would be a public entity that could hold title to this
property. Therefore, we are requesting that the Fridley HRA consider holding title to this
property so that we can utilize the MHFA funding to meet this need.
We would like to discuss this concept and determine the city's interest in holding title to the
property. I've asked Edna Hoium of our staff to call you in the next week to answer any
questions you might have and determine how you would like to proceed in this matter. Thank
you in advance for your consideration.
Sincerely,
4Jerryoma q4 u n
Interim Division Manager dU 1:1
:gd .�
4C _ V-PCw�uch- ti Cl-�,t.+Aculk
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`iKtltti?k Kew,' Pi�ii: w�.` it; w:l �: t: 2wtiA3£ i��ff4- �.'' RR�.`; D. tiiwtr .�a:KKxKti•;�:�{.K.n..,..... ... ....�..... -. ,
PROPERTY MANAGEMENT AGREEMENT
This Agreement, made and
Housing and Redevelopment
politic, organized under
University Avenue N.E.,
referred to as the '!HRA"
Program, Inc., Minnesota
Avenue N.E., Suite 3,45,
referred to as "ACCAP ".
WITNESSETH THAT:
entered into by and between the Fridley
Authority, a public body, corporate and
Minn. Stat. S 469.090 et. seq., 6431
Fridley, Minnesota, 55432, hereinafter
and the .Anoka County Community Action
private nonprofit corporation, 1201 89th
Blaine, Minnesota 55434, hereinafter
WHEREAS, the HRA owns a four (4) plex situated in the City of
Fridley, County. of. Anoka, 'State of Minnesota, legally
described as Lots 12 & 13, Block 6, City View
(hereinafter the "Property "); and,
WHEREAS, there is a demonstrated need for short term transitional
housing for low income residents, particularly for
families from the City of Fridley and County of Anoka;
and,
WHEREAS, ACCAP has adopted a transitional housing program designed
to assist in fulfilling said demonstrated need for such
short term housing; and,
WHEREAS, this property has been adapted to help fulfill the need
for such short term housing; and,
WHEREAS, ACCAP in conjunction with other sponsoring agencies has
formulated a transitional housing project to help fulfill
the need for short term transitional housing, and,
WHEREAS, to implement the transitional housing program, ACCAP
desires to manage this Property and lease said Property
to Lutheran Social Services, Inc. who will make this
Property available for their clients to live in as part
of their transitional housing project; and,
WHEREAS, ACCAP is experienced in the business of operating and
managing a property similar to the above described
Properties.
NOW THEREFORE, in consideration of the mutual covenants and
agreement contained herein, the parties do covenant and
agree as follows:
1. EXCLUSIVE RIGHT TO MANAGE
The HRA hereby grants to ACCAP the exclusive right to manage this
Property and ACCAP accepts the appointment, subject to the terms
all
Property Management Agreement
June, 1995
page 2
and conditions set forth in this Agreement. This Property to be
managed by ACCAP under this Agreement consists of one (1) four (4)
unit:apartment situated in .the.Ci.ty of Fridley, County of Anoka,:
State of Minnesota, legally described as Lots 12 & 13, Block 6,
City View. ACCAP shall be in exclusive control and possession of
this Property and the HRA shall not be liable for any injury or any
damage to any property or to any person happening on or about this
Property or any person thereon. ACCAP shall be responsible to
lease this Property to the sponsoring agency, Lutheran Social
Services, Inc. or an equivalent nonprofit transitional housing
provider acceptable to the HRA, who. will make this- Property
available to their clients in the transitional housing project.
2. MAINTENANCE AND REPAIR
ACCAP shall, at all times during the term of this Agreement, at its
own cost and expense, repair, replace and maintain in a good, safe
and substantial condition, any buildings and any improvements,
additions, and alterations thereto on this Property, and shall use
all reasonable precautions to prevent waste, damage or injury to
this Property. ACCAP shall maintain this Property in good repair
including, but not limited to cleaning, painting, decorating,
plumbing, carpentry, groundscare and such other maintenance or
repair work as may be necessary. ACCAP further agrees to maintain
this Property in compliance with all applicable health and safety
laws of the State and of local units of Government where this
Property is located. At all time during the term of this
Agreement, ACCAP shall maintain and repair this Property so it
shall not be in such a condition as to constitute a violation of
any applicable, State, County, or City health, housing, building
fire prevention, or housing maintenance codes.
3. RECORDS AND REPORTS
ACCAP shall keep books, accounts and records that reflect all
revenue and any expenditures incurred in connection with the
management and operation of this Property. ACCAP shall also keep
records of the number, type, category and length of residency of
the people served under the transitional housing project. The
books, accounts and records shall be maintained at ACCAP's
principal place of business. ACCAP shall, during regular business
hours, make _the books, accounts and records required to be
maintained hereunder, available to the HRA or the representatives
of the HRA for examination and audit upon reasonable notice.
Within sixty (60) days of the end of
shall prepare and deliver the HRA a
number, types, categories and length
4E
each calendar year, ACCAP
detailed statement of the
of residency of the people
Property Management Agreement
June, 1995
page 3
served under the project and a detailed statement of the revenues
received and expenditures incurred and paid during the calendar
year that resulted from the operations of this Property and the
transitional housing project.
4. BANK ACCOUNT
ACCAP shall deposit (either directly or in a depository bank for
transmittal, all revenues from this Property into an account
maintained at a national or state member bank who is a member of
the. Federal Deposit Insurance Corporation. ACCAP shall keep a
detailed record of deposits and withdrawals from said account so as
to adequately insure that the monies from the transitional housing
project can be accounted for. With the revenues deposited in said
account, ACCAP shall pay all items with respect to this Property.
S. UTILITIES
All applications and connections for necessary utility services on
this property shall be made in the name of ACCAP only, and ACCAP
shall be solely liable for utility charges as they become due,
including those for sewer, water, gas, electricity and telephone
services.
6. TAXES AND SPECIAL ASSESSMENTS
ACCAP shall pay any and all taxes and special assessments on this
Property which may arise during the term of this Agreement. ACCAP
agrees that for the tax years that this property will be in exempt
status, ACCAP will reimburse the HRA for the local share of
property taxes on this property as reflected at its current tax
classification rate. The HRA will invoice ACCAP by August 1st of
the respective years ad ACCAP will make the payment to the HRA by
October 15th.
7. ALTERATIONS AND IMPROVEMENTS
ACCAP shall make no alterations to the buildings on this Property
or construct any building or make other improvements on this
Property which exceed $5,000.00 without the prior written consent
of the HRA. All alterations, changes or improvements located,
constructed or placed on this Property by ACCAP shall, unless
otherwise provided by written agreement between the parties, be the
property of the HRA.
B. USE OF THIS PROPERTY
This Property shall be used and occupied solely by individuals
4F
Property Management Agreement
June, 1995
page 4
placed by the sponsoring agencies in the transitional housing
project. ACCAP shall maintain and operate the transitional housing
project on this Property in accordance with all current State,
County, municipal health and safety regulations. ACCAP shall not
use or permit this Property or any part thereof to be used for any
purpose other than the purpose or purposes stated herein.
9. SURRENDER OF THIS PROPERTY
At the expiration or termination of this Agreement or any
subsequent agreement, ACCAP shall vacate and surrender this
Property in as good a state and condition as they were after the
completion of the rehabilitation work, reasonable wear and tear
excepted.
10. INDEPENDENT CONTRACTOR
It is agreed that nothing herein contained is intended or should be
construed in any manner as creating or establishing a relationship
of co- partners between the parties hereto. ACCAP is and shall
remain an independent contractor with respect to all services and
liabilities performed under this Agreement. All individuals hired
by ACCAP pursuant to this Agreement shall be considered employees
of ACCAP and shall not be considered employees of the HRA for any
purpose or in-any manner whatsoever.
11. NO PROPERTY INTEREST CREATED
Nothing contained in this Agreement shall be deemed to create or
shall be construed as creating in ACCAP any property interest in or
to this Property.
12. INDEMNIFICATION
The HRA shall not be liable for any loss, injury, death or damage
to persons whose property which at any time amy be suffered or
sustained by ACCAP or by any person who may at any time using or
occupying or visiting this Property or be in, on, or about the
same, whether such loss, injury, death or damage shall be caused by
or any way result from or arise out of any act, omission, or
negligence of ACCAP or of any occupant sponsoring agency, visitor,
or user of any portion of this Property, or shall result from or be
caused by any other matter or thing whether of the same kind as or
of a different kind than the matters or things above set forth.
ACCAP shall indemnify the HRA against all claims, liabilities, loss
or damage whatsoever on account of any such loss, injury, death or
damage.
4G
Property Management Agreement
June, 1995
page 5
13. HOLD HARMLESS
ACCAP agrees to hold harmless the HRA for any shortfall in the
operation of this property, as well as any shortfall associated
with the applicable rules and regulations of the Minnesota Housing
Finance Agency and the underlying mortgage on this property.
14. INSURANCE
ACCAP shall, at all times during the term of this Agreement, and at
ACCAP PIs sole expense, keep all -'improvements, which- are now or
hereafter a part of this Property insured against loss or damage by
fire and the extended coverage hazards for the replacement value of
such improvements. Full replacement value cannot be mutually
agreed upon, then full replacement value shall be determined by the
Anoka County - Assessor. ACCAP shall also maintain in effect
throughout the term of this Agreement personal injury liability
insurance covering the premises and its appurtenances and the
sidewalk fronting thereon in the amount of $200,000.00 for property
damage and /or injury to or death of any one person and $600,000 for
property damage and /or injury to or death of any number of persons
in one occurrence. ACCAP shall at the time of the execution of
this Agreement and from time to time thereafter provide proof of
said insurance.
In the event of any loss, damage, or destruction of this Property,
any proceeds from said policies shall be paid to the HRA who, in
its sole discretion, shall determine whether the proceeds shall be
used to repair or replace any and all improvements on this
Property. In the event the proceeds are not used to repair or
replace the improvement on this Property, the proceeds shall be
used for a purpose which is consistent with those of the
transitional housing project or to satisfy the MHFA Repayment
Agreement. ACCAP shall have the HRA named as additional insured on
all insurance policies required herein.
14. ASSIGNMENT
Neither party to this Agreement shall assign the Agreement, nor any
interest or rights therein, without the written consent of the
other.
15. RIGHT OF ENTRY
The HRA and the HRA's appointed agents reserve the right to enter
this Property at all reasonable hours upon reasonable notice during
the term of this Agreement and any renewal thereof for the purpose
of inspecting this Property and all building improvements thereon.
4H
Property Management Agreement
June, 1995
page 6
16. LIENS
ACCAP shall keep this Property and every part thereof and all
buildings and other improvements at any time located thereon free
and clear of any and all mechanics, materialmans and other liens
for or arising out of or in connection with work or labor done,
service performed or materials or appliances used or furnished for
or in connection with any operation of ACCAP, any alteration,
improvements or repairs or additions which ACCAP may make or permit
or cause to be made, or any work or construction by, for or
permitted by ACCAP on or about this-Property, or-any obligations of
any kind incurred by ACCAP, and at all times promptly and fully
pay, discharge any and all claims on which any such lien may or
could be based, and to indemnify the HRA and this Property against
all such liens and claims of liens and suits or other proceedings
pertaining thereto, provided, however, that ACCAP shall not be
responsible to pay or discharge any lien upon said Property if the
lien is not the result of their actions under the terms of this
Agreement.
17. TERM OF AGREEMENT
This Agreement shall be for a term commencing on ,
1995 and ending on 11 2000, and any further
extensions as agreed to by the parties, the date of signatures
notwithstanding.
18. LICENSE OF ACCAP
ACCAP shall at all times during the term of this Agreement maintain
such licenses and permits as are required for any of the various
services to be performed by ACCAP or the sponsoring agencies.
19. TERMINATION OF AGREEMENT
The HRA may terminate this Agreement upon ACCAP's failure to
perform or abide by any of the terms or conditions herein. Prior
to termination, the HRA shall give to ACCAP, written notice of the
grounds for termination and allow ACCAP reasonable time to remedy
the conditions.
20. EQUAL EMPLOYMENT OPPORTUNITY - CIVIL RIGHTS
During the term of this Agreement, ACCAP agrees to the following:
No person shall, on the grounds of race, color, religion, age, sex,
disability, marital status (affectional preference), public
assistance status, criminal record, creed, or national origin, be
excluded from full employment rights in, participation in, or
41
Property Management Agreement
June, 1995
page 7
denied the benefit of, or be otherwise subject to discrimination
under any program, service or activity under the provisions of any
and all applicable Federal and State laws against discrimination
including the Civil Rights Act of 1964. ACCAP will furnish to the
HRA all reports required by Executive Order No. 11246 and Revised
Order No. 4, and by the rules and regulations and orders of the
Secretary of Labor, Minnesota Department of Human Services, for
purposes of investigation to ascertain compliance with such laws,
regulations and orders.
21. DATA PRACTICES
All data collected, created, received, maintained or disseminated
or used for any purposes in the course of ACCAP's performance of
this Agreement is governed by the Minnesota Government Data
Practices Act, Minnesota Statutes 1984, Section 13. 01, et. seq., or
any other applicable state statutes and any state rules adopted to
implement the Act, as well as State statutes and Federal
regulations on data privacy. ACCAP agrees to abide by these
statutes, rules and regulations as they may be amended.
22. MODIFICATIONS
This Agreement may not be modified unless such modification is in
writing and signed by both parties to this Agreement.
23. NOTICES
Any notice or demand required by the provisions of this Agreement
to be given to the HRA or ACCAP shall be deemed to have been given
adequately, if sent by certified mail, to the following address:
ACCAP: Anoka County Community Action Program, Inc.
1201 89th Avenue N.E., Suite 345
Blaine, Minnesota 55434
Attn: Executive Director
HRA: Fridley HRA
6431 University Avenue N.E.
Fridley, Minnesota 55432
Attn: Executive Director
IN WITNESS WHEREOF, the parties have executed this Agreement on the
day and year first above written.
FRIDLEY HOUSING AND ANOKA COUNTY COMMUNITY ACTION
AND REDEVELOPMENT AUTHORITY PROGRAM, INC.
4J
Property Management Agreement
June, 1995
page 8
Date
Executive Director
Date
ch
_~`..~~`~~.~~..'^~~~~```.`."~=`~°"°~°`'/°
Patrick McFarland Date
Executive Director
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Date
.
11AP -23 -1 9-5 14:42
Darwin Li.ndlahl
Architect
STATEMENT OF PROBABLE CONSTRUCTION COST
City View Apartments
380 - 58th Place N.E.
Fridley, MN
File No: 9503
March 23, 1995
The following is a breakdown of the estimated construction cost for the necessary
improvement/maintenance items.
1. UNIT #1
P. 06
A.
Replace unit entry doors (front and back)
$ 920.00
B.
Replace unit interior doors as required
900.00
C.
Renovation of Kitchen
970.00
D.
Renovation of Bathroom as required
1,850.00
E.
Replacement of carpet and vinyl flooring
1,200.00
F.
Miscellaneous radiation cover repairs
100.00
G.
Replace smoke detector
50.00
Total estimated cost for Unit #1
$ 5,940.00
2. UNIT #2
A.
Replace unit entry doors (front and back)
$ 920.00
B.
Replace unit interior doors as required
500.00
C.
Renovation of Kitchen
970.00
D.
Renovation of Bathroom as required
1,850.00
E.
Replacement of carpet and vinyl flooring
1,200.00
F.
Replace light fixtures as required
100.00
G.
Replace smoke detector
50.00
Total estimated cost for Unit #2
$ 4,760.00
3_ UNIT #3
A.
Replace unit entry doors (front and back)
$ 920.00
B.
Replace unit interior doors as required
900.00
C.
Renovation of Kitchen
970.00
D.
Renovation of Bathroom as required
1,850.00
E.
Replacement of carpet and vinyl flooring
1,200.00
G.
Replace smoke detector
50-40
Total estimated cost for Unit #3
$ 5,890.00
1(605)535 -301)7
3836 Hampshire Ave. N.
Minneapolis, MN 55427
4L
_rIAP- 1'=95 14:43 P.07
4. UNIT #4
A.
Replace unit entry doors (front and back)
$ 920.00
B.
Replace unit interior doors as required
900-00
C.
Renovation of Kitchen
970.00
D.
Renovation of Bathroom as required
1,850.00
E.
Replacement of carpet and vinyl flooring
1,200.00
F.
Replace light fixtures as required
50.00
G.
Replace smoke detector
50.00
Total estimated cost for Unit #4
$ 5,940.00
a.INTF -RIOR COMMON SPACES
A. laundry room vinyl the floor $ 650.00
B. Stair way flooring replacement 760.00
C. Light fixture replacement 500.00
D. Electrical circuit breaker replacement _1.050.00
Total estimated cost for common spaces $ 2960.00
6. BUILDING EX'T'ERIOR
A. Window replacement $ 10,600.00
B. Entry door replacement ( front and back) 1,000.00
C. Re- roofing 2,600.00
D. Augment attic insulation 500.00
E. Re -dash stucco 2,700.00
F. Replace gutters and downspouts 1,800.00
G. Aluminum fascia/soffit 975.00
1. Intercom system at front door 750.00
Total estimated cost for building exterior $ 20,925.00
7. SITE IMPROVEMENTS
A. Trash enclosure S 2,800.00
B. Landscaping 1,000.00
C. Construct new four stall garage 22,500.00
C. Parking lot overlay 3.500.00
Total estimated cost of site improvements $ 28.800 �0
Total estimated construction cost $ 73,255.00
General conditions (5 °!0) 3,660.00
Contractor's overhead and profit (10 %) 7&aQ-00
Total Estimated Project Construction Cost $ 84.605.00
page 2 of 2
4Mrnlrnf O nr7
380 57th Place
Transitional Housing Project
ACCAP and Lutheran Social Services
BACKGROUND:
1. ACCAP applies for MHFA funding in September 1994 to acquire
and rehab 4 -plex.
2. Funding source was titled "Transitional Housing Program ".
PROJECT DETAILS:
1. Purchase price: $92,000
2.
Rehab costs:
$84,605
3.
Total requested:
$176,605
4.
Garage could
be constructed on the site with variances (site
is a double
fronted
lot).
5.
The building
has 3 two bedrooms and 1 one bedroom.
6.
MHFA funding
is a 20
year deferred loan; if property is sold,
MHFA must be
repaid
in its entirety.
CURRENT STATUS:
1. MHFA funded the request, but from a different program account
which mandates ownership by a "local government unit."
2. The title of the program is "Publicly -Owned Transitional
Housing and Battered Women and Other Crime Victims Facility
Program ".
3. Lutheran Social Services (LSS) was contacted by ACCAP to act
as the "provider" of the transitional housing service. The
public owner would lease to ACCAP who would in turn contract
with LSS to provide the services.
4. LSS wants to expand its service delivery into Anoka County
given the demand for this type of service.
5. ACCAP states that additional funding exists in the new MHFA
account to fund all rehab costs plus additional expenses like
a new garage. HRA assistance is not needed for this project.
6. There are two tenants in the building on a month to month
lease. ACCAP will lease one of the units to a "caretaker ".
The existing tenants may be transferred to the coop buildings
in Hyde Park.
4N
TRANSITIONAL HOUSING:
1. Anoka County receives 200 to 300 calls per month from people
seeking housing.
2. Motels have been used to fill some of the demand, but are not
solutions for families in crisis.
3. Transitional housing is temporary housing with support
services.
4. By providing temporary housing, support services can then be
provided to the families /individuals to stabilize the
immediate problems, and then help them find permanent housing.
LUTHERAN SOCIAL SERVICES:
1. LSS is owned by the six Minnesota synods of the Evangelical
Lutheran Church in America.
2. Programs include outreach to youth at -risk, programs for the
disabled persons, counseling, senior services, and housing and
advocacy.
3. Funding is obtained from United Way, church congregations, and
other private foundations or grant sources.
4. Funding for the Fridley project would be obtained on an annual
basis from the sources identified above.
S. Potential tenants must be screened by LSS prior to occupancy.
Individuals needing chemical dependcy, abuse counseling, or
mental health services are referred to other programs or
resources.
6. The one bedroom unit would be occupied by a permanent tenant;
the tenant would not be an employee of LSS.
7.. LSS would provide ongoing couseling and case management
services to the occupants.
8. Rents to be charged are $400 for the two bedroom units and
$350 for the one bedroom unit.
9. This is NOT a drop -in shelter; all occupants must be screened.
10. LSS leases two homes from HUD to provide other services; one
is in Coon Rapids and the other is located at 6130 Starlite
Circle in Fridley.
OWNERSHIP RESPONSIBILITIES:
1. There are two options: City /HRA ownership and Anoka County
HRA ownership.
2. Anoka County ownership would require execution and approval
of a Joint Powers Agreement, and prior to this, resolutions
from the HRA and City Council requesting the Anoka County HRA
to perform this service. Anoka County has indicated that it
does not to own the four plex and would like the City or City
HRA to own it.
3. Despite who owns the buildings, ACCAP will agree to the
following
a. The building.will be leased to ACCAP, who in turn will
execute a provider agreement with Lutheran Social
Services to provide the transitional housing service.
b. ACCAP will provide insurance for the property (based on
replacement value), personal injury liability, and
property damage-.liability insurance.
C. ACCAP will assume all operating costs plus maintenance
and equipment replacement.
d. ACCAP will pay the City's portion of the real estate
taxes.
e. ACCAP will act as the lead contact regarding any property
or neighborhood issues.
f. If the owner is forced to sell the property prior to
expiration of the 20 year mortgage, ACCAP will make up
the difference between the sale price and the original
mortgage price.
4. ACCAP would complete rehab and renovation prior to conveying
to new owner.
5. Service provider would be responsible for reserve account for
future improvements.
RECOMMENDATION:
Staff recommends that the City HRA assume ownership of the four -
plex subject to execution of a Property Maintenance Agreement with
ACCAP with the provisions listed in #3 above.
i
CONSENT ITEMS FOR HRA
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 8, 1995
CALL TO ORDER:
Chairperson Commers called the June 8, 1995, Housing &
Redevelopment Authority meeting to order at 7:38 p.m.
ROLL CALL:
Members Present: Larry Commers, Virginia Schnabel, Jim
McFarland,.Duane Prairie
Members Absent: John Meyer-
Others Present: William Executive Director
Barbara Dacy, Community Development.Director
Scott Hickok, Planning Coordinator
Jim Casserly, Financial Consultant
Grant Fernelius, Housing Coordinator
Craig Ellestad, Accountant
APPROVAL OF MAY 11 1995 HOUSING AND REDEVELOPMENT AUTHORITY
MINUTES•
MOTION by Ms. Schnabel, seconded by Mr. McFarland, to approve the
May 11, 1995, Housing and Redevelopment Authority minutes as
written.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
CONSENT AGENDA:
1. APPROVE BILL OF SALE FOR REMOVAL OF GUNDERSON HOME AT 5707
WEST MOORE LAKE DRIVE N.E.
2. MONTHLY HOUSING REPORT
3. SOUTHWEST QUADRANT BUDGET EXPENSE
4. REVENUE AND EXPENSES
Mr. Ellestad provided copies of additional expenses to be
approved with those previously submitted.
NOTION by Mr. McFarland, seconded by Mr. Prairie, to approve the
Bill of Sale for Removal of Gunderson home at 5707 West Moore
Lake Drive N.E.; to approve the Monthly Housing Report; to
approve the Southwest Quadrant Budget Expense; and to approve
check register #25538 through #25576 plus the additional expenses
contained in the memo of June 8, 1995, from Mr. Ellestad for a
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 8, 1995 PAGE 2
total of $16,671.21.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION.CARRIED UNANIMOUSLY.
ACTION ITEMS•
5. AWARD OF BIDS FOR SOUTHWEST QUADRANT DEMOLITION
Ms. Dacy stated staff's recommendation is to award the demolition
contract to Herbst and Son for $194,200 and to award the salvage
contract to Bauer Wrecking and Salvage Company for $10,000. The
two amounts combined give the HRA the best price for the .
demolition and salvage of items in the redevelopment area. This
is the most cost efficient and is below the anticipated budget.
In-light-of the events of -the potential lawsuits, • a •motion to--
approve would be subject to execution of-a settlement agreement..
Mr. Dacy stated they have worked with the contractors before on
Rice Creek Plaza. They were very cooperative to work with.
Staff expects their full cooperation.
MOTION by Ms. Schnabel, seconded by Mr. McFarland, to award the
demolition bid to Herbst and Son FOR $194,200 and to award the
salvage bid to Bauer Wrecking and Salvage Company FOR $10,000
subject to the execution of a settlement agreement.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON CONNERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
6. CONSIDER PURCHASE OF FRANK'S USED CAR PROPERTY
Mr. Burns stated staff has been working on this for some time.
The agreement arrived at would have the HRA paying $150,000 for
the property under certain conditions. The most important is for
the heirs to complete the clean up of the site and to provide a
statement of closure from the PCA. He is insisting on that
before closing on the property, and he has communicated this to
the realtor representing the estate. The other part is to waive
the right to relocation payments. There will be no separate
payment for the fixtures. In purchasing the building, we are
also purchasing the fixed assets. There is no separate fixed
asset payment. The environmental portion is not that
complicated. There are some tanks to be removed and the soil
around the tanks will likely need to be excavated. There was
likely some leaking or spilling. There is a well on site to be
capped.
Mr. Commers asked if the family would be eligible for assistance.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 8, 1995 PAGE 3
Mr. Burns stated he believed the family would be eligible for
petrol fund assistance on the tanks. He did not get a formal
appraisal. They got a budget appraisal similar to what they got
for the Southwest Quadrant project. The appraiser indicated that
he recognized $154,000 as the top amount. The appraiser arrived
at this by recognizing that we could face potential condemnation
and relocation costs, clean up costs, and included the fixed
assets. Based on that, he felt that $154,000 was the top value.
Mr. Burns also had a separate meeting with the City Attorney and
appraiser on all the properties and identified a negotiating
strategy. The $150,000 level was supported by that meeting.
This was reviewed with the City Council. Mr. Burns indicated
they were at that time at $140,000 and the seller at $160,000.
He was encouraged by some of the Councilmembers to delay the
process of acquiring the property. There was no objection to
that strategy..'Based on'that,-he.went ahead. He,mey have been
able to'do better. He thought they had a fair price. "The owners
are facing some of the costs associated with-the clean up. He
believed this was fair for all.
Mr. Commers asked Mr. Burns to address the memo from
Councilmember Billings dated June 8, 1995, regarding Frank's Used
Cars.
Mr. Burns stated Councilmember Billings is pointing out there was
not a binding auction for the property earlier this spring. One
bid on the property was for approximately $95,000. Mr. Burns
believed that is what Councilmember Billings is referring to and
wondering why we are offering more. One must recognize that the
situation might be different for the private sector. However, if
you consider the alternative to a negotiated settlement is
condemnation, then this deal becomes acceptable in light of
condemnation.
Mr. Prairie stated he assumed there was information the bidders
did not have. Would the buyer take responsibility for the clean
up? There may be other things we cannot see.
Mr. Burns stated he did not know the conditions placed on the
buyer. There may be other things. The price we bid for Custom
Mechanical was substantially higher than what we are offering for
this property.. That helped set a comparison for this property as
well. The other source of advise was from Mr. Herrick who has a
good knowledge of commercial real estate. He stated, if you buy
commercial property along a major highway for $3.00 a foot, you
have paid an acceptable price. He did acknowledge that $150,000
would be an expected purchase price.
Mr. Prairie asked if the City Council was satisfied with this.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 8, 1995 PAGE 4
Mr. Burns stated he did not know why Councilmember Billings is
not satisfied at this point. He has had opportunities to
indicate his dissatisfaction. In the negotiating process, Mr.
Burns reported where he was in the process. He puts together a
weekly report of the.City Manager and -the City Council reads it
carefully. If there is an objection, he-usually hears about it.
In this instance, he did not hear any comments.
Mr. Commers stated it looks as if the issue is that the appraisal
is less than $100,000, but with the condemnation costs it would
be $150,000.
Mr. Burns stated the.appraisal was over $100,000 on the -
preliminary estimate. He recognizes that the tax assessor had
.the property on -the books . for $108, 000 to $110, 00.0. - He .
recognized we.were going to pay the market price. They worked
from there to consider the avoidance items and came up with
-$154,000.
Ms. Schnabel stated she was curious about the estate being
responsible for the environmental clean up. Is that something
they will hire done?
Mr. Burns stated they have to. Staff had a Phase I audit done
for that property. Our consultant says they would have to hire a
consultant approved by the PCA who will them take them through
the Phase II, a remedial action plan and through the
implementation plan to follow up. The MPCA will take the word of
this consultant if the consultant agrees to give a clean bill of
health and will issue a closure statement. They will not do it
if the work is done without appropriate approval. He has told
the estate the HRA will not take the property without a closure
statement.
Ms. Schnabel asked if the heirs are local.
Mr. Burns stated the person he had spoken with lived near St.
Cloud. He thought the other family members were local. Most of
the negotiations have occurred between Mr. Burns and the realtor
representing the owners. A closing date will be established when
the work has been completed.
Mr. McFarland asked what would be done with the property.
Mr. Burns stated they would do the same as they did with the
Custom Mechanical site. It will be cleared and converted for
residential purposes. The property would be sold to a building
contractor to build the type of housing the HRA would like to
have built.
Mr. McFarland stated the closure does not necessarily indicate
the property is cleaned entirely. They have property that has
been contaminated. As long as they do not break the surface,
they will get a closure statement. If you do break ground, you
will need to clean it up.
Mr. Burns stated they did a Phase I to protect themselves. There
are fuel tanks in the - ground so the family will have to clean
that up. The other items are minor such as asbestos which is
above ground but we insist they take that out as well. If there
are floor tiles as well, we may be willing to concede.
Mr. Commers stated he would like to verify that the closure.does
remove us from any liability from the underground tank clean up.
Mr. McFarland-stated the petrol fund•will'riot allow their
liability to pass from-the owner to the buyer. If the petrol
fund would protect the sellers, that right would not pass to us
as a buyer.
Mr. Casserly stated, as a public authority, you are in a
different position. You are not going to be a responsible party
when you buy the property. The problem is,.if you acquire it, it
does not mean that it is saleable. You do not have direct
liability. It would have to be cleaned up. There could be a
significant difference if there is significant pollution.
Ms. Schnabel stated that is why she asked about the heirs to the
estate so the HRA does not get something that is not anticipated.
Mr. Casserly stated the problem is finding someone who has the
resources to clean it up. What is commonly happening -is that the
properties are being forfeited to the state.
Mr. Commers stated the HRA is not closing or paying any money
until the property has been cleaned up and all problems solved.
With that contingency, we are not going forward until it has been
taken care of.
Ms. Schnabel asked if the HRA was eligible for Superfund monies.
Mr. Burns stated he thought they might if they owned property
with oil contamination. It does not apply to all types of
contamination.
Ms. Schnabel stated, if the heirs were not able to carry this
through and if we offer a lesser amount and applied for Superfund
monies, would that be feasible.
Mr. Prairie stated the buyer usually does not want to take that
gamble.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE S. 1995 PAGE 6
Ms. Dacy stated, in the case of the Lake Pointe site, if you not
aware of the contamination issue when buying, you take on a
voluntary responsibility to resolve the problem and you can
become eligible for petrol funds.
Mr. Casserly stated the petrol fund is a no fault program funded
through the gas tax program and a unique program that works
extremely well. If you have petrol -based contamination problems,
the fund supplies resources to do it. The fund can continue to
replenish itself because it uses gas tax funds.
Mr. Prairie stated there is no question about cleaning that area.
They have talked about it for a number of years.
Mr. Commers asked how the property was zoned.
'Mr. Burns stated the current * zoning -.is considered-non-conforming
as a commercial use and it goes back to residential when the
owners cease to exist. These are spot zonings.
Mr. McFarland stated he would assume that Leisch and Associates
are qualified and they would give proper counsel.
OTION by Ms. Schnabel, seconded by Mr. Prairie, to approve the
acquisition of Frank's Used Cars at the price of $150,000 subject
to the clean up of the property, receiving verification that the
property has been cleaned, waiving the relocation benefits by the
property owner, and the acquisition of fixed assets.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
INFORMATION ITEMS•
7. CONSIDER TIF ASSISTANCE FOR NORTHCO
Mr. Burns stated, about four to six weeks ago, Mr. Zylla
approached him with a proposal to consider providing tax
increment financing for the construction of a storm sewer and for
soil correction along 73rd Avenue. It occurred to him that the
HRA is riding a bubble of considerable industrial and commercial
development at this time, and this may be the time to consider
the request. There has been a relaxation of the penalties on tax
increment financing so it may be timely to work with Northco.
Mr. Casserly has worked with Mr. Zylla to find out more about the
project and identify how we might help.
Mr. Casserly stated Mr. Zylla had indicated they have been
pursuing several users. The one that is most likely they were
not sure they could do with fall construction. The development
is for winter or early spring. He would like to identify the
HOUSING & REDEVELOPMENT AUTHORITY MEETING. JUNE 8, 1995 PAGE 7
costs, find out if the HRA would be amenable to some assistance,
and try to put together a package. They are still trying to give
us values and to better identify the costs. It is important that
they are able to qualify this as a tax increment district and
they must meet the requirements. He thought he would be able to
report more in July. Because of this site, they had a proposal
before the HRA five years ago. They were trying to create a
development district. There was very little assistance that
could be provided. It may be timely to look.at it again and also
find out, if we were to create a tax increment district, if we
would be able to generate real assistance.
Mr. Burns stated he would like to know if the HRA would like
staff to continue to work with them or is this something you do
not want-to do.
Mr. Commers stated the HRA has a number of priorities and -is
having some economic issues that will cost the HRA a lot. If
this is a nice project, he hate to leave it, but then again he
thought the HRA was better served to concentrate on what they
were now doing.
Mr. Burns stated he thought they were looking at a pay -as- you -go
type of project which would be based on the revenue the project
generates, and it will generate revenue for other projects.
Mr. Casserly stated the taxes paid are substantial. There are
some peculiarities with doing this type of project, but this is
not a net cost to the HRA.
Ms. Schnabel stated the HRA did not have enough information at
this point to say yes or no.
Mr. Commers stated the HRA could look at it, see where the HRA
is, and see how it works out.
Mr. Burns stated he did not foresee a lot of complications with
this project. If they were asking for some variances, there
might be opposition from the neighborhood. He did not think
Northco was asking for any variances, and he did not think there
would be complications.
8. UPDATE ON HOUSING REPLACEMENT LEGISLATION
Mr. Fernelius stated the bill authorizing the pilot housing
replacement program was signed into law. Next month, staff will
be coming back to the HRA and working with the City Council to
formalize this program. There is an actual housing replacement
program that staff needs to put together. Both the HRA and City
Council need to adopt the program. Staff will be coming back in
July or August with this program.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 8, 1995 PAGE 8
Mr. Commers asked if they needed to be concerned about the Fair
Housing Act.
Mr. Casserly stated he had prepared a three -page program analysis
based on the legislation which he sent to Greene and Espel. They
thought this was positive. The only time that there would be a
problem is if the HRA is involved in condemnations. If the HRA
operates on a voluntary basis, there should be no problem. If we
stick to the criteria as laid out in the legislation which
includes that the sites are to be vacant or substandard, there
should not be a problem. He will work with staff to define this
as part of the policy. Even if they have to enter into a
condemnation, it will be part of the program established..
Mr. Commers stated, as .long as this has been recommended by legal
counsel and they -see no problems,. the. .HRA will take _ a look at it.
Ms. Dacy stated a letter from Mr. Czech was included in the
agenda packet for the HRA's information.
Mr. Commers stated they also had received information on site at
1207 Gardena. Is assistance being at this point?
Ms. Dacy stated the owner is pursuing a buyer.
Mr. Commers asked if the two homes on Glencoe Street had been
demolished.
Mr. Fernelius stated the two homes had been taken down the day
before the meeting.
Mr. Commers asked the status of the execution of a development
contract.
Mr. Fernelius stated the development contract had been drafted,
signed and ready to go.
Mr. Commers asked what is going to happen with the excess
liability insurance coverage.
Ms. Dacy stated staff has asked Mr. Hunt to prepare some
estimates. If the HRA wishes to pursue additional coverage, they
will do so.
Mr. Commers stated the problem is that he did not know that the
HRA would feel comfortable knowing they have personal liability
if there is a judgment over $600,000. That may put a damper on
things. This does not address excess coverage on those kinds of
cases that we are not limited to $600,000 under the statutes. If
there would be a $1 million judgement and although the City's
coverage is $600,000, there could be an excess judgement for
HOUSING & REDEVELOPMENT AUTHORITY MEETING JUNE 8 1995 PAGE 9
$400,000. That is a concern.
Ms. Dacy thought this information addressed that concern.
Mr. Burns stated the question is whether we want to purchase the
excess liability coverage.
Mr. Commers stated the information as provided says to him that
the City in.normal circumstances has limited liability to
$600,000. If they want to, we can purchase non - waiver coverage
which would give us excess coverage in those cases where the
statutory limits do not apply. Where the statutory limits do
apply, the City would not would not pay claims over $600,000 per
occurrence. The issue is whether to pick up the non - waiver
coverage for anything over $600,000 in those cases where the
$600,000 limit does'not apply.. In,his opinion, it seets*that'the
City should do something to-take sure the HRA members do not have
personal liability. There may be a way the City can do that
without the City buying the insurance, at least as far as the HRA
is concerned. For example, perhaps the City could pass a
resolution indemnifying the HRA if there is ever a judgement.
Perhaps there is some way the City's legal.staff could look at
that and see if there is an option.
Mr. McFarland stated he thought this had been done on the State
level. There was a law passed within the last three years.
Mr. Commers asked staff to look at that and see what it is. This
is an issue that requires some solution. In looking at the
information, he was not sure that $1 million in coverage was
sufficient.
Mr. Burns stated that is with $2 million in annual expenses. For
1995, the HRA's budget is higher. He will try to get more
clarification.
Mr. Casserly stated there is a completely different issue. The
HRA should not be getting insurance that covers increased
exposure. You only want to cover your exposure. The HRA may be
responsible for things which the members are not. The members do
not need to be covered for hundreds of thousands of dollars, but
rather for those things you are exposed to.
Mr. Commers stated they may have an insurable interest. If they
have a $10 million pool that we are dealing and someone gets a $5
million judgement, they could take away from what the HRA is
trying to do. Other than that, that is the HRA's interest. We
have exposure of the officers and directors and that is what we
want coverage for. It is possible that the members could be sued
individually. The real issue is that members would have
potential personal exposure.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 8, 1995 PAGE 10
Mr. Burns stated he thought the members were covered but he did
not know to what limits. He will look at this further and report
back.
9. CONSIDER INFORMATION REGARDING LAKE POINTE SITE
Ms. Dacy stated she met with a representative Towle Real Estate
on Tuesday. She put them in touch with a representative from
MEPC. This is related to the HRA's goals for the site which is
why staff is bringing this to the HRA's attention. Staff is
still working with MEPC and Galbraith. Staff will be coming back
in July on a proposal from MEPC-and Galbraith.
Mr. Burns stated Medtox Laboratories is very interested in the
site.. This is one of-two or' three sites they -.are considering.
If we want them,* we have a.reason4ble chance. The problem is
that they want a two- story, 80,000 square foot building with
surface parking. They are looking to do that on seven acres. If
you apply that density for the seven acres, to the large-parcel
designated for office space, that is 250,000 square feet of
density. We are looking for 500,000 square feet of density.
Mr. Burns stated he would report the information and if the HRA
wishes to pursue the project, staff would get back to them.
otherwise, he encouraged them to work with one of the two
prospective developers for the site and consider leasing space.
The representative seemed to be willing to do that.
Mr. Commers stated this was fine at this point. They would see
what happens.
10. CITY OWNERSHIP OF FOUR PLEX AT 380 - 57TH PLACE N.E. FOR
TRANSITIONAL HOUSING
Ms. Dacy stated this discussion has been going on since
September. Originally, the HRA supported ACCAP's application to
purchase, rehab and operate a four -plex for transitional housing
services. During the funding cycle, the MHFA indicated the
transitional housing program was filled. However, the MHFA put
the application into another category of public ownership and
provided funding. The good news is that ACCAP no longer needs
financial assistance on this project from the HRA. They can
fully fund the acquisition and rehabilitation. However, a public
entity must own the building. Staff discussed the ownership
issue with the City Council. The Council was concerned that
County ownership may dictate the City becoming eligible for or
responsible for paying a part of a levy by the County. Staff
.contacted the County about that, who stated ownership would not
dictate that. The HRA and City Council would have to pass a
resolution to request it. However, they did have a policy
problem with the City asking the County to own it and then to ask
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 8, 1995 PAGE 11
that they not be reimbursed for expenses for performing services.
A second issue raised was the affordable housing issues raised
with the Southwest Quadrant redevelopment project. This project
would convert four units into affordable housing. ACCAP is
committed to this project, and they have guaranteed to take on
the operating expenses, insurance costs, real estate taxes and,
if there is a forced sale of the property before the expiration
of the mortgage, they pare willing to pay the gap between what the
property is selling for and the remainder of the mortgage. ACCAP
wants to complete this project.
Ms. Dacy stated a model is Blaine's Economic Development
Authority's agreement with ACCAP for four homes for a battered
women's program. The only difference in this case is that ACCAP
is guaranteeing to cover the gap in a forced sale situation.
Ms. Dacy . stated staff wanted to bring this to the attention of
the HRA. This item is also scheduled for City Council discussion
on Monday. The Councilmember for this ward will recommend that
the City strongly consider taking ownership. It makes sense that
the HRA be the owner of the property given the housing function.
There have been new pieces of information coming up in the last
few months, and staff feels it prudent to bring this to your
attention.
Mr. Commers stated it is difficult to recommend without an
opportunity to read over the information.
Ms. Dacy stated there is no problem with having this item on the
July agenda for a final determination.
Mr. Commers asked staff to add this to the July agenda along with
the City Council information.
11. PROPOSAL FROM REDEEMER LUTHERAN CHURCH
Mr. Burns stated he had met with the pastor of Redeemer Lutheran
Church and the chair of the Planning Commission. Redeemer is on
Mississippi Street, is out of space and wants to expand. They
now need space for overflow parking. Their plan is to purchase
19 properties in an area bounded by Mississippi, Ashton and 64th
Way with the exception of the Spur station.. Eventually, they
want to move their complex to this area and face East River Road
rather than Mississippi Street.
Mr. Burns stated Redeemer is expanding rapidly. In the past,
they have asked for room in the park and the neighborhood has
been hostile -to that. The railroad tracks are an obstacle. 6409
East River Road is a vacant property that we have under contract
for Whitney Homes. Redeemer wants the City to void that
property. They consider this a key piece of property to acquire
HOUSING & REDEVELOPMENT AUTHORITY MEETING JUNE 8, 1995 PAGE 12
and it will be much more expensive for them if there is a home
there. There is no definite time frame. He tried to get an idea
of how committed the church was to this proposal. The request
appears to be from two individuals who came in to see him. He
did not think there had been a membership vote.
Mr. Burns is bringing this before the HRA. There are two sides.
The church emphasizes.values and supports youth. This church has
a lot to offer. It is a good community asset. On the other
hand, buying 19 parcels is also taking away property taxes. You
may also conclude that this would take away affordable housing.
The parishioners are planning to go to property owners and
purchase.one parcel at.a time. The question is whether or.not
the congregation wants to do this right now. He thought they had
talked.to Whitney directly.
Mr. Commers asked if the issue is that, if Whitney Homes is
willing to sell to the church, will we Void the contact.
Mr. Burns stated he was not sure what mechanism they would use to
settle the matter. Staff is asking the HRA if you want to
consider approaching Whitney. Are we willing to let Whitney out
of a development contract?
Ms. Schnabel asked, if we do that and the church fails to
proceed, then they are stuck with a vacant tax exempt property.
Mr. Prairie stated this seemed like a lot of property. vHow many
acres does the church have now?
Mr. Burns stated he estimated they would have four acres. It is
not a large parcel. They did come in earlier and talked about
adding a second floor to the education building and wanted to
expand the parking. We talked about different alternatives.
Mr. Fernelius stated the proposed parcel is part of the scattered
site program which we would include in our housing replacement
program and could potentially recoup some of the expenses.
Another issue is the developer is in the process of marketing
this property. Our agreement goes through the end of October
when the home is to be completed. He suggested they wait and see
if the property is marketable first, and then consider doing
something with the church at that time since their plans are so
preliminary at this point.
Mr. Commers stated the real issue is whether we would place that
development of a home as a priority if in fact they really are
going to expand.
Mr. Prairie stated they have no drawings, but that could change.
The idea could even be voted down.
6
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 8, 1995 PAGE 13
Mr. Burns stated it may be a logical step to regard getting a
show of support from the congregation or some sort of a plan.
Mr. Dacy stated, at the last meeting, they discussed 1207 Gardena
which is similar in that a person from the neighborhood came
forward asking the HRA to purchase a property so the neighborhood
could buy it. The discussion indicated the intent is to purchase
and build on the property. These are similar because it is a
neighborhood property-owner who wants to clear land for something
other than its intended use.
Mr. Burns stated it would be difficult to ask them to request a
show of support.
Ms. Schnabel stated it seems the church is not prepared at this -
point to'perceive what,they.want as a project. She thought-they-
in some ways take their.chances.—If they go through their plan'
as they see it, buy the properties, they will just have to face
that chance and buy this property if it has been already
developed. She did not think the HRA should make special
accommodations for something that is so preliminary at this
point. She thought the HRA has a plan in place and that they
should proceed.
Mr. Prairie stated the church should be able to assure the HRA
that there is at least a 50/50 chance of this happening.
12. UPDATE ON SOUTHWEST QUADRANT
Mr. Commers stated the public portion of the meeting is
temporarily adjourned to receive an update regarding the
Southwest Quadrant and will be conducting a closed meeting with
respect to the information that shall be provided.
MOTION by Ms. Schnabel, seconded by Mr. Prairie, to adjourn the
meeting.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED AND THE JUNE 8, 1995, HOUSING AND
REDEVELOPMENT AUTHORITY MEETING ADJOURNED AT 9:34 P.M.
Respectfully submitted,
Lavonn Cooper
Recording Secretary
I _
DATE:
TO:
FROM:
SUBJECT:
Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
July 13, 1995
William Burns, Executive Director of HRA
Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
Authorization-to Acquire "5924 - 21hd Street N.E.
This is a one story, single - family home located in the Hyde Park
neighborhood and is owned by Rodger Geyer, 4466 Constance
Boulevard, Ham Lake, MN. The property has suffered from deferred
maintenance and has structural problems, most notably a severely
rotted roof over the back addition. Due to the condition of the
home, its small size and design, it is a good candidate for the
program.
The house was built in 1948 and is located on an 80 ft. x 129 ft.
lot which is considered buildable by City code. The County has
the house valued for taxes purposes at $47,697 ($21,140 land;
$20,603 building and $5,954 special feature). Staff had the
property appraised by Richard Erickson of Appraisal Engineering
Bureau for $36,000. The owner agreed to sell for $38,000 which
is within HRA negotiation guidelines.
Once acquired, the home will be torn down and the lot re -sold
through our Housing Replacement program. It is worth noting that
this is the second property acquired in Hyde Park this year, and
the 12th property purchased since the program began last year.
Recommendation
Staff recommends that the HRA approve the purchase of 5924 2nd
St. for $38,000 and further that the HRA Director is authorized
to execute all documents necessary to complete the purchase.
GF/
M -95 -398
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Scattered Site Acquisition / Housing Replacement Program
Status Report
Buildable Lots
Address
1 6409 East River Rd.
2 8280 East River Rd.
3 539 Glencoe St. ( *)
4 547 Glencoe St. ( *)
5 677 Hugo St
6 187 Longfellow St
7 540 Hugo St ( *)
8 550 Hugo St ( *)
9 533 Janesville
10 5924 2nd St
Non — Buildable Lots
Address
1 6000 2nd St
2 683 Glencoe St
Acquired Demolished
7/94
8/94
6/94
8/94
2/95
5/95
11/94
5/95
9/94
11/94
4/94
8/94
5/95
Pending
9/94
11/94
5/95
Pending
Pending Pending
Acquired Demolished
Pending Pending
9/94 5/95
07/13/95
Sold Builder /Owner
Yes
Whitney Homes
Yes
Whitney Homes
Yes
Whitney Homes
Yes
Whitney Homes
Yes
Whitney Homes
Yes
Whitney Homes
No
HRA
No
HRA
No
HRA
No
HRA
Sold Builder /Owner
Pending ** HRA
No HRA
Notes:
* — Lots will be combined.
** — Property will either be sold or leased to ACCAP which owns a fourplex next door.
Site may be re —used for additional parking spaces and /or garage.
r �
Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: July 13, 1995
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Establish Public Hearing Date for the Disposition
of Lot 4, Block 1, Scherer Addition
This is a vacant parcel of land located along East River Rd., two
lots north of the Locke Lake dam. It was purchased by Anoka
County several years ago for a road project and the home was torn
down. Since then, the lot has remained vacant and unbuildable
due to a utility easement which runs across the middle of the
property.
The neighbor to the south approached the County about buying the
property, however by law the County is unable to sell the
property to a private party. The County approached the HRA about
the possibility of acting as an intermediary to acquire and then
re -sell the property to Roberta Moore.
Ms. Moore has agreed to purchase the property for $6,800 and
cover any legal costs associated with the transaction. However,
before the property can be conveyed to Ms. Moore, the HRA is
required to hold a public hearing.
The hearing will be held at the next regular meeting of the HRA
on August 10th.
Recommendation
Staff recommends that the HRA call a public hearing for August
10, 1995 for the disposition of Lot 4, Block 1, Scherer Addition.
GF/
M -95 -399
r 1
Community Development Department
HOUSING AND REDEVELOPMENT .AUTHORITY
City of Fridley
DATE: March 3, 1995 1"
TO: William W. Burns, Executive Director of HRA 44
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Consider Temporary Purchase of Vacant Lot from
Anoka County
On February 8th staff was contacted by Mike Kelly from the Anoka
County Highway Department about a vacant parcel they own along
East River Road just north of the Locke Lake dam. -
Kelly indicated that they were contacted by -the homeowner
immediately to the south of the site concerning their interest in
buying the parcel. The County apparently has. no need - for the
property (it was acquired several years for .a road project and
the home was removed) and doesn't want to continue to-maintain
it. Roberta Moore who lives south of the site, has expressed
interest in buying the property (see attached-letter)--and
enlarging her yard.
Under state law, the County.is unable to convey the property
directly to a private party, but can.convey it to another
governmental body such as an HRA. In essence, the County would
sell the property to the HRA for an agreed upon price and then
the HRA could turn around and sell it to a third party.
We did consider the lot as a potential new home site, but have
concluded that it may be difficult to market due to its location
along East River Road.
Unless otherwise directed, Staff will proceed with negotiations
on the purchase and conveyance of the lot with the understanding
-that the HRA will not bear any expenses in the transaction.
GF/
M -95 -143
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CITY OF FRIDLEY
HOUSING & REDEVELOPMENT AUTHORITY MEETING, MARCH 9, 1995
CALL TO ORDER:
Chairperson Commers called the March 9, 1995, Housing and
Redevelopment Authority meeting to order at 7:40 p.m.
ROLL CALL'
Members Present: Larry Commers, Virginia Schnabel, Duane
Prairie
Members Absent: Jim McFarland, John Meyer
Others Present: William Burns, Executive'Director
Barbara Dacy, Community.Development Director
Jim Casserly, Financial Consultant
Grant Fernelius, Housing Coordinator
Craig Ellestad, Accountant
Tom Stanek, 7035 Willow Lane
Bert McElrath, Norway Pine Builders
APPROVAL OF FEBRUARY 9. 1995. HOUSING AND REDEVELOPMENT AUTHORITY
( MINUTES:
MOTION by Ms. Schnabel, seconded by Mr. Prairie, to approve the
February 9, 1995, Housing & Redevelopment Authority minutes as
written.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
CONSENT AGENDA:
1. AUTHORIZE 1995 HOME FUND APPLICATION TO ANOKA COUNTY AND
AUTHORIZE HRA MATCHING FUNDS
2. CONSIDER ACQUISITION OF THREE.SCATTERED -SITE PROPERTIES_:
6200 - 2nd Street
540 Hugo Street
533 Janesville Street
3. CONSIDER APPROVAL OF RESOLUTION AND MEMORANDUM OF
UNDERSTANDING WITH NORTHEAST STATE BANK TO PARTICIPATE IN
MHFA / FRIDLEY HOME IMPROVEMENT PROGRAM
4. CONSIDER ACQUISITION OF ANOKA COUNTY PROPERTY AT 6765 EAST
RIVER ROAD
`' 1� . 5. MONTHLY HOUSING REPORT
�
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HOUSING & REDEVELOPMENT AUTHORITY MEETING MARCH 9 1995 PAGE 2 r
6. REVENUE AND EXPENSES
MOTION by Ms. Schnabel, seconded by Mr. Prairie, to authorize the
1995 Home Fund Application to Anoka County and authorize H$A
matching funds; to authorize the Executive Director to proceed
with acquisition of three scattered site properties located at
6200 - 2nd Street, 540 Hugo Street, and 533 Janesville Street; to
approve a Resolution 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 Northeast State
Bank of Minneapolis; to authorize acquisition of Anoka County
property located at 6765 East River Road; to receive the Monthly
Housing Report; and to check register #25434 through #25464 as
submitted.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
ACTION ITEMS•
7. CONSIDER AWARD OF BIDS FOR SCATTERED -SITE PROPERTIES
Mr. Fernelius stated staff contacted 15 builders to solicit
interest in bidding on the lots. Two parties submitted bids for f
the properties. A summary of the bids was distributed. The two l
bidders are Tollefson Homes and Norway Pine Builders. Mr.
McElrath, Norway Pine Builders, has submitted some additional
materials about the company. Staff's recommendation is for the
HRA to authorize the sale of the lots located at 6409 East River
Road, 8280 East River Road and 187 Longfellow Street to Tollefson
Homes. Staff does not recommend that the bid be awarded for the
last two properties. Staff makes this recommendation based upon
the fact that Norway Pine Builders does not want to enter into a
development contract as required. Norway Pine Builders is
essentially offering a cash offer for the lots and would not
enter into the development agreement or provide a letter of
credit. They would be buying the properties and constructing
homes on those lots. The HRA would have essentially no means of
insuring that homes are actually constructed. Therefore, staff
is recommending awarding the bid to Tollefson Homes who would
agree to enter into a development contract. Staff feels the
offer made for 677 Hugo Street and 539 and 547 Glencoe Street is
not adequate.
Mr. Commers asked why there were such low bids for 677 Hugo
Street and 539 and 547 Glencoe Street.
Mr. Fernelius stated he could not explain the rationale.
Ms. Dacy stated Mr. Brad Dunham, on behalf of Tollefson Homes, }
called and stated the reason for the bids as they are is because
3D
9 t
MAY 23, 1995
�_0Ur.T StlFIVE jF - i.= T. - - -- _ _
Pte-
COUNTY OF ANOKA
Office Of rite Coway Asse.mor
Government Center
2100 3rd Avenue, Anoka, Minnesota 55303 -2281
612- 323 -5475 Fax: 612-323-5421
MEMO TO: MIKE KELLY
HIGHWAY RIGHT jQF -1KAY
FROM: ED THURSTON
ANOKA. COUNTY ZJSSESSOR
RE: PIN 15 30 24 12 0067. LOT 4, BLOCK 1, SCHERER ADDITION.
CITY OF FRIDLEY
ESTIMATED MARKET VALUE AFTER RIGHT -OF -WAY TAKING.
The current estimated market value of the above referenced
unimproved real property is $6,800. The estimated market value
conclusion assumes that the property is unbui.ldable and has no
legal access to a public street.
if you have any questions concerning this matter, please Gall me
at 323-5499.
t�
at°
Fmmnlnvar
r �
Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: July 13, 1995
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Consider Amendment-to Contract with Whitney Homes
Whitney Homes closed on the purchase of the scattered site lots
at 8280 and 6409 East River Rd. and 187 Longfellow St. on July 5,
1995. The builder is currently in the process of obtaining the
necessary building permits from the City and plans to start
construction next week.
The development contract
specifies that they will
HRA's mortgage by August
closing, the developer is
10, 1995.
Recommendation
between the HRA and Whitney Homes
have the home completed and pay off the
14, 1995. However, due to the delayed
requesting an extension to September
Staff recommends that the HRA approve an amendment to the
development contract with Whitney Homes which extends the
completion date to September 10, 1995.
GF/
M -95 -400
DRAFT 7 -11 -95
ADDENDUM TO THE
SALE & DEVELOPMENT AGREEMENT
RELATING TO
8280 East River Road
6409 East River Road
187 Longfellow Street
BY AND BETWEEN THE
FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY
1
WHITNEY HOMES, INC.
I u
� r
THIS ADDENDUM, is made and entered into this
, 1995, by and between the Fridley Housing and
Redevelopment Authority, (hereinafter called the "HRA"),
Whitney Homes, Inc. (hereinafter called the "Developer ")
WHEREAS, the parties executed the original Sale and
Development Agreement referenced above on
and
day of
and
1995;
WHEREAS, the parties have mutually agreed that the dates set
forth in paragraphs 2.01 and 4.02 of the original Sale and
Development Agreement shall be modified.
NOW, THEREFORE, in the joint and mutual exercise of their
powers and in consideration of the mutual covenants contained in
the Sale and Development Agreement dated , 1995,
and the provisions as set forth below, the parties hereto agree
to amend said original agreement as follows:
112.01. Sale. The HRA agrees to sell the Property to
Developer and the Developer agrees to purchase the Property
from the HRA for the purchase price of $42,500.00.
Developer will purchase the Property by Quit Claim Deed
with a minimum down payment of $1,500.00. The balance of
$41,000.00 will be carried on a purchase money mortgage
(Exhibit B) at 5.0 0, which mortgage and interest will be
due and payable no later than , 1995, at which
time, if Developer is in full compliance with this
agreement, Developer will be provided with a Warranty Deed
and Satisfaction of Mortgage."
114.02 New Construction. Developer shall be solely
responsible for the construction, marketing and sale of the
single family homes on the Property by , 1995.
The minimum selling price of said homes shall be
$80,000.00."
IN WITNESS WHEREOF, the HRA has caused this Agreement to be
executed by its duly authorized officers; and the Developer has
executed this Agreement the day and year first above written.
a
47
FRIDLEY HOUSING AND
REDEVELOPMENT AUTHORITY
By:
William W. Burns
Its: Executive Director
B-Z
Lawrence R. Commers
Its: Chairperson
WHITNEY HOMES, INC.
By:
Its:
STATE OF MINNESOTA
ss.
COUNTY OF ANOKA
On this day of 01 1995, before me, a Notary Public
within and for said County, appeared to me personally known, who,
being by me duly sworn, did say that he is William W. Burns named
in the foregoing instrument, the Executive Director of the
Fridley Housing and Redevelopment Authority, a body politic and
corporate under the laws of the State of Minnesota, and that this
instrument was signed as his free act and deed.
Notary Public
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STATE OF MINNESOTA )
ss.
COUNTY OF ANOKA )
On this day of , 1995, before me, a Notary Public
within and for said County, appeared to me personally known, who,
being by me duly sworn, did say that he is Lawrence R. Commers
named in the foregoing instrument, the Chairperson of the Fridley
Housing and Redevelopment Authority, a body politic and corporate
under the laws of the State of Minnesota, and that this
instrument was signed =as his free act and deed.
Notary Public
STATE OF MINNESOTA )
ss.
COUNTY OF ANOKA )
On this day of , 1995, before me, a Notary Public
within and for said County, appeared to me personally known, who,
being by me duly sworn, did say that he is
named in the foregoing instrument, the
of Whitney Homes, Inc., a corporation under the. laws of the State
of Minnesota, on behalf of the corporation, and that this
instrument was signed as his free act and deed.
f: \mrnicXJdh\fhradevk.aad
Notary Public
I _
Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: July 13, 1995
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Consider Service Contract with Anoka County
Community-Action Program (ACCAP) for
Administration of the HOME- funded Housing
Rehabilitation Program
Since 1993, the City and HRA have used both CDBG and HOME funds
to provide grants to low- income homeowners for improving their
homes. Due to the tremendous amount of time and staffing
required, we have contracted with ACCAP to help administer the
program.
As in previous years the City will market the program, take
applications and identify those who are eligible for the program.
ACCAP will provide inspection services, work write -ups, help the
homeowner obtain estimates and select a contractor, monitor work
performance, and conduct inspections. ACCAP has agreed to
administer its portion of the program for $10,313.
This year, the HRA received $75,000 in HOME funds and must
provide a 25% match or $18,750. Up to 5% of the entire budget or
$4,688 can be used for administration purposes. This leaves a
balance of $5,625 which must be paid separately by the HRA. We
would like to point out that this expense was included in the
1995 budget.
As a final note, these funds will only be used in the Hyde Park
neighborhood.
Recommendation
Staff recommends that the HRA approve the Service Contract with
ACCAP to administer the housing rehabilitation program for a
total cost not to exceed $10,313.
GF/
M -95 -401
` ` Equal Opportunity Employer ' ' ' 1995 HOME Funds
SERVICE CONTRACT
between
ANOKA COUNTY COMMUNITY ACTION PROGRAM, INC.
and
FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY
THIS AGREEMENT, made this day of 1995, the date of the signatures of the
parties herein notwithstanding; -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 (the
'Authority', and the Anoka County Community Action Program, Incorporated, a 501(c)(3) rion- profit
corporation, with its offices at 1201 - 89th Avenue N.E., Blaine, Minnesota 55434 (the 'Contractor").
WITNESSETH THAT:
WHEREAS, The HOME Investments Partnerships Act (the HOME Investment Partnerships Program)
provides assistance to state and local governments to strengthen public- private partnerships to provide
more affordable housing; and
WHEREAS, the Authority has submitted an application for the HOME Investment Partnerships Program
to Anoka County; and
WHEREAS, said application has received preliminary approval from Anoka County and is currently
pending approval by the United States Department of Housing and Urban Development for the
expenditure of funds to deliver the Fridley Home Improvement Grant Program (the 'Program'; and
WHEREAS, the Contractor has agreed to jointly administer said Program for the Authority, which
proposal has been accepted by the Authority.
NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties agree as
follows:
1. TERM
The project to be accomplished by the Contractor hereunder shall run from a 1995 to
1996, unless earlier terminated as provided herein, or until all obligations set forth in
this agreement have been satisfactorily fulfilled, whichever occurs first.
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5A
w �
2. SERVICES TO BE PROVIDED
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A The Contractor shall provide the following services to administer the Program:
(1) Verify property title records, prepare repayment agreements for signature by
Program recipients, and insure said repayment agreements are properly,
recorded with Anoka County.
(2) Coordinate and conduct inspections of properties to be improved under the
Program and prepare bid specifications for work to be performed.
(3) Assist Program recipients in obtaining estimates for the work to be performed.
In addition, providelhe Program recipient-with the'options available In
selecting contractors.
(4) Meet with Program recipients to review estimates and select a contractor per
the Program requirements.
(5) Insure that the successful contractor complies with the applicable HUD and
County regulations.
(6) Monitor performance of rehabilitation work and assist Program recipient in
resolving disputes with contractors, as necessary.
(7) Conduct interim and final inspections and prepare the necessary documents to
process payment to the contractor. Said documents shall be routed through
the Authority's Housing Coordinator for approval prior to submission to Anoka
County for processing.
B. In addition to the processing steps outlined above, the Contractor shall provide the
following services:
(1) Compile and maintain lists of participating construction contractors.
(2) Comply with the Housing Rehabilitation Procedures Guide, as amended from
time to time.
(3) Provide the Authority of Fridley with monthly reports on the status of program
applications.
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(4) Make payments to contractors on a timely basis, in compliance with the
Federal "three-day rule.
(5) Acquire mechanic's liens from all contractors, subcontractors, and material
suppliers, prior to release of any payments.
C.- In addition, the Contractor shall proceed with the administration of the Program as
;contained' in the Pfagram Budget, attache'as Exhibit Aand- made apart of `this
contract by reference, representing Contractor's minimum responsibilities to the extent
that said proposals have not been accomplished prior to the date of this Contract as
entered into and to the extent said proposals do not contradict the standards and
requirements referred to above.
D. It shall be the responsibility of the Contractor to meet all standards and satisfy all
requirements expressed in Title 1 of the Housing and Community Development Act of
1974 as amended and the HUD Implementary Regulations at 24 CFR, Part 570, and
any other applicable federal statutes, rules, or regulations established now or hereafter,
and any applicable statutes, rules, regulations, or guidelines established now or
hereafter by the State of Minnesota or any of its agencies. Should it appear to the
Contractor at any time during the course of implementing said project, that the work to
be done has not been explained or described in sufficient detall, or with sufficient
clarity, or should it appear that any plan, proposal, or other material confect with any
standards or requirements imposed by statute, regulation, or HUD, the Contractor shall
promptly apply to the Authority's Housing Coordinator or other designated
representative. In no event shall the Contractor proceed with administration of said
project in uncertainty. The Contractor shall comply with the following requirements and
standards of OMB Circular No. A-1 22, "Cost Principles for Non Profit Organizations" or
OMB Circular No. A -21, "Cost Principles for Educational Institutions', as applicable, and
with the following Attachments to OMB Circular No. A-1 10:
(1) Attachment A, 'Cash Depositories% except for paragraph 4 concemdng deposit
insurance;
(2) Attachment B. 'Bonding and Insurance';
(3) Attachment C. 'Retention and Custodial Requirements for Records', except that
in lieu of the provisions of paragraph 4, the retention period for records
pertaining to individual CDBG activities starts from the date of submission of
the annual performance and evaluation report, as prescribed in 570.507, in
which the specific activity Is reported on for the final time;
5C
(4) Attachment F, 'Standards for Financial Management Systems';
(5) Attachment H, 'Monitoring and Reporting Program Performance', paragraph 2;
(6) Attachment N. 'Property Management Standards', except for paragraph 3
concerning the standards for real property, and except that paragraphs 6 and 7
are so modified so that
() In all cases in which personal property is sold, the proceeds shall be
program income, and
(i) Personal property not needed by the subrecipient for CDBG activities
shall be transferred to the, 'ecipient for the CDBG' program or shall be
retained after compensating the recipient; and
(7) Attachment O, 'Procurement Standards'.
3. PROJECT METHODOLOGY AND PROCEDURE
The Contractor, in providing the services described in Section 2 of this Contract, shall employ methods
and procedures that are deemed to be appropriate, reliable, and professional by individuals, firms, and
associations regularly engaged in work of a similar nature. The methods and procedures employed
shall include those required by the sources of authority specified in Section 2, herein, but shall not
necessarily be limited to such methods and procedures.
4. PROJECT EVALUATION AND ACCEPTANCE
In order that the Authority may be kept informed of the Contractor's progress and properly evaluate the
success of the Contractor in achieving the Contract goals, the Authority may make suggestions,
criticisms, and recommendations to the Contractor and the Contractor shall on a monthly basis and at
other times upon request by the Authority, send a written progress report to the Authority's Housing
Coordinator. Said report shall a) summarize the activities and progress of the Contractor to date, b)
detail special problems or difficulties that have arisen during the course of the project which need to be
brought to the attention of the Authority and c) summarize any other information, problems, or
proposals which the Authority needs to know in order to properly evaluate the actions of the Contractor
in working towards the Contract goal. The Contractor shall thoroughly and conscientiously implement
the proposals, recommendations, and criticisms of the Authority or its designated representative, in
writing, before proceeding further with the implementation of the program so that the goals of this
Contract may be met to the satisfaction of the Authority.
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5D
Any deviations from the goals, standards, and requirements of the project as determined by said
designated representatives of the Authority shall be corrected by the Contractor before proceeding
further with the implementation of said project.
5. PROJECT ADMINISTRATION. PERSONNEL AND RECORDS
A. The Contractor shall engage in the implementation of the Program, such individuals as
are necessary for I.ts proper completion. The Contractor warrants and represents that
all of its employees.shall be properly trained, competent and qualified to
perform the tasks assigned to them. The Contractor shall provide the Authority with
such information regarding the qualifications of said individuals as required by the
Authority to verify that present and subsequent services are being rendered by
competent and trained people. AU individuals engaged by'the Contractor to perform
services under this Contract must receive express approval of the Authority before
commencing any services under the Contract. Any or all of said individuals may be
regular employees of the Contractor or may be specifically employed by the Contractor
as independent contractors to work on the implementation of said project. However,
the Contractor shall riot subcontract with any other firms, associations, consulting
agencies, or other organizations for the implementation of the Program, without the
expressed written approval of the Authority.
B. The Contractor shall maintain records on all individuals employed by it In the
implementation of the Program. Said records shall show the name and qualifications
of each such 'individual, the hourly rate of pay for each such individual, and the number
of hours worked by each such individual, and the days on which such hours were
worked. The Contractor shall also maintain, and complete in correct form, all other
records required by the rules, regulations, or guidelines of HUD or by Title I of the
Housing and Community Development Act of 1974 as amended and the HUD Imple-
mentary Regulations at 24 CFR, Part 570. The Contractor further agrees to maintain all
such required records for three years after receipt of final payment or until all other
pending matters are closed.
6. DATA PRIVACY
All data collected, created, received, maintained, or disseminated, or used for any purposes in the
course of the Contractor performance of this Agreement is governed by the Minnesota Government
Data Practices Act, Minnesota Statutes 1984, Section 13.01 et. seq. or any other applicable State
statutes and any State rules adopted to implement the Act, as well as State statutes and Federal
regulations on data privacy. The Contractor agrees to abide by these statutes, rules, and regulations
and as they may be amended.
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7. NONDISCRIMINATION
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A. General
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, sexual orientation, or.
the presence of any sensory; mental, or physical handicap or any other basis now or hereafter
prohblted by Law-. These"regnirements are specified in Section 109 of the-Housing and
Community Development Act of 1974; Civil Rights Act of 1964, Title VI; Civil Rights Act of 1968,
Title Vill; Executive Order 11063; Executive Order 11246; Section 3 of the Housing and Urban
Development Act of 1968; and Minnesota Statutes Chapter 363. Specifically, the- Contractor is
prohibited from taking any discriminatory actions defined in the HUD Regulations at 24 CFR
570.602(b)'(1 -3) and shall take -such. affirmative and- corrective actions as are. required by the
Regulations at CFR 570.602(b)(4).
B. Program Benefit
The Contractor shall not discriminate against any resident or Program recipient by denying
benefit from or participation in any block grant funded activity on the basis of race, color, sex,
or national origin. (Civil Rights Act of 1964, Title VI; Civil Rights Act of 1968, Title VII; Section
109, Housing and Community Development Act of 1974).
C. Fair Housing
The Contractor shall take necessary and appropriate actions to prevent discrimination on the
basis of Minnesota State law or federal law in federally assisted housing and lending practices
related to bans insured or guaranteed by the federal government. (Civil Rights Act of 1968,
Title VII; Executive Order 11063; Minnesota Statutes Chapter 363).
D. Employment
1. In all solicitations under this Agreement, the Contractor shall state that all
qualified applicants will be considered for employment. The words 'equal
opportunity employer` in advertisements shall constitute compliance with this
section.
2. The Contractor shall not discriminate against an employee or applicant for
employment in connection with this Agreement because of age, marital status,
race, creed, color, national origin, sexual orientation, or the presence of any
5F
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sensory, mental, or physical handicap, except when there is a bona fide
occupational limitation. Such action shall include, but not be limited to the
following: Employment, upgrading, demotion or transfer, recruitment or
recruitment advertising, layoff or termination, rates of pay or other forms of
compensation, and selection for training. (Executive Order 11246 as amended
and Minnesota Statutes Chapter. 363.)
3. To the greatest extent feasi] le; the Contractor shall provide training and ...
employment opportunities for lower income residents within the area served by
block grant assisted projects (Section 3, Housing and Community
Development Act of IM, as amended).
E Contractors and Suppliers
No contractor, subcontractor, union, or vendor engaged in any activity under
this Agreement shall discriminate in the sale of materials, equipment, or labor
on the basis of age, sex, marital status, race, creed, color, national origin,
sexual orientation, or the presence of any sensory, mental, or physical
handicap. Such practices include upgrading, demotion, recruiting, transfer,
layoff, termination, pay rate, and advertisement for employment. (Executive
Order 11246 as amended and Minnesota Statutes Chapter 363).
2. All firms and organizations described above shall be required to submit to the
Agcy certificates of compliance demonstrating that they have, in fact,
complied with the foregoing provisions; provided, that certificates of
compliance shall not be required from firms and organizations on contracts
and /or yearly sales of less than $10,000.
3. To the greatest extent feasible, the Contractor shall purchase supplies and
services for activities under this agreement from vendors and contractors
whose businesses are located in the area served by block grant funded
activities or owned in substantial part by project area residents. (Section 3,
Housing and Community Development Act of 1M, as amended.)
F. Notice
1. The Contractor shall include the provisions of the appropriate subsections A, B,
C, D, and E of this section in every contract or purchase order for goods and
services under this Agreement and shall send to each labor union or
representative of workers with which it has a collective bargaining agreement
or other contract or understanding a notice advising the said labor union or
workers representative of the commitments made in these subsections.
5G
2. In advertising for employees, goods, or services for activities under this Agreement, the
Contractor shall utilize minority publications in addition to publications of general
circulation.
8. EARLY TERMINATION
This Agreement may be terminated by the Authority at any time, with or without cause, upon 30 days
written notice, delivered by mail or in person, to the Contractor. This Agreement may be terminated by
the Authority immediately upon the receipt by the Authority of notice of the loss of federal funding for
the Community Development Block Grant Program (CDBG). For purposes of giving notices hereunder,
the address of the Contractor is 1201 - 89th Avenue N.E. Blaine, MN 55434. Upon termination, the
Contractor shall be entitled_ to receive as compensation, payment for work actually performed to the
date of termination
as determined by the schedule of payment referred to in Section 10 (Compensation).
9. DEFAULT AND REMEDY
A Any of the following constitutes a default on the part of the Contractor.
(1) Failure to proceed with the implementation of the Program at a pace
reasonably calculated to implement such program within the time limits stated
herein;
(2) Failure to conscientiously abide by the directions of the Authority.
(3) Failure to abide by any other term or condition of this Contract.
B. In the event of default, the Authority shall have the option of terminating this Contract
upon written notice of termination sent to the Contractor at its address written above.
Termination shall be effective immediately upon receipt of notice of termination by the
Contractor, or at such later date as the written notice shall state. Upon termination, the
Authority may recover from the Contractor any and all damages directly or
consequently arising out of the breach of this contract or failure to perform the same
by the Contractor.
10. COMPENSATION
As complete compensation for the services to be performed hereunder by the Contractor, the
Contractor apply for reimbursement of administration expenses directly from Anoka County, but only
after receiving written approval from the Authority authorizing said reimbursement.
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5H
In no event shall the total payment exceed the sum of the administrative fee column in Exhibit A
The Contractor agrees that all compensation received will be used to compensate the Contractor only
for costs incurred in providing necessary services hereunder, and for no other purposes. Any
compensation received by the Contractor in excess of said necessary costs shall be promptly refunded
to the Authority upon termination of this contract or upon demand by the Authority.
11. INDEPENDENT CONTRACTOR
The relationship of the Contractor to the Authority is that of an independent contractor. Nothing in.this
Contract shall be construed so as to deem any employee or agent of the Contractor an employee of
the Authority for any purpose.
12. GOODS AND SERVICES NOT PROVIDED FOR
No claim for goods or services furnished by the Contractor not provided for by the terms of this
Contract, or by duly authorized alterations or modifications of this Contract, will be honored by the
Authority.
13. CHANGES IN THE CONTRACT
The Authority shall notify the Contractor in writing at least five days before any change in this Contract
is to take effect.
14. ASSIGNMENTS AND SUBCONTRACTING
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A The Contractor shall not assign any portion of this Agreement without the written
consent of the Authority, and it is further agreed that said consent must be sought by
the Contractor not less than thirty (30) days prior to the date of any proposed
assignment.
B. Any work or services assigned or subcontracted hereunder shall be subject to each
provision of this Agreement and proper bidding procedures contained therein. The
Contractor agrees that it is as fully responsible to the Authority for the acts and
omissions of its subcontractors and of their employees and agents, as it is for the acts
and omissions of its own employees and agents.
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15. INDEMNIFICATION
The Contractor agrees to indemnify, defend, and hold harmless the Authority (including its Council
members, officers, and employees) from all claims, losses, or damages which they, or any of them
shall be legally obligated to pay as a consequence of any negligent act or omission, any intentional
tort, or any violation of the terms of this agreement, by the Contractor (including its officers,
Employees, and agents) in the performance of its services that are the subject of this agreement:
16. REVERSION OF ASSETS
Upon the expiration or termination of this agreement, the Contractor shall transfer to the Authority any
CDBG funds on hand or in the accounts receivable attributable to the use of CDBG funds. In addition,
at the expiration or termination of this agreement; any real property under the Contractors control that
was acquired or improved in whole or in part with CDBG funds in excess of $25,000.00 shall be
disposed of in a manner which results in the agency being reimbursed in the amount of the current fair
market value of the property less any portion thereof attributable to the expenditures of non -CDBG
funds for acquisition of, or improvement to, the real property. Such reimbursement shall not be
required if the conditions of 24 CFR State Statute 570.503(b)(8)@ are met and satisfied.
17. DISPOSITION OF PROGRAM INCOME
Upon the expiration or termination of this agreement, program income shall be returned by the
Contractor to the Authority.
18. INSURANCE
The Contractor shall comply with the following insurance requirements:
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A Public Liability Insurance
The Contractor shall obtain and maintain continuously during the term of this
agreement general liability insurance of an amount not less than One Million and
no /100 ($1,000,000.00) Dollars which covers bodily injury and property damage and an
umbrella excess liability policy of Three Million and no /100 ($3,000,000.00) Dollars and
provide proof of Workers Compensation Insurance pursuant to the Statutes of the
State of Minnesota The general liability insurance policy and umbrella excess liability
policy shall name the Authority as an additional insured.
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19.
B. Proof of Insurance
The Contractor shall provide certificates of insurance required under this section, or,
upon request of the Authority, duplicates of the policies as evidence of the insurance
protection afforded. Such insurance policies shall not be reduced or cancelled without
sixty (60) days prior written notice to the Authority.
ENTIRE AGREEMENT /REQUIREMENT OF A WRITING
It is understood and agreed that the entire agreement of the parties is contained herein and that this
Contract supersedes all oral agreements and negotiations between the parties relating to the subject
matter hereof as well as any previous Contract presently in effect between the Authority and the
Contractor relating to the subject matter hereof. -Any alterations, variations; modifications, or waivers of
the provisions of this Contract shall be valid only when they have been reduced to writing and duly
signed by the parties.
20. EXHIBITS
The following attachments listed below are hereby incorporated in this agreement and made a part
hereof:
Exhibit A - Program Budget
Exhibit B - Certification
Exhibit C - 24 CFR 85; Contracting with small and minority firms, women's business enterprise,
and labor surplus area firms.
IN WITNESS WHEREOF, the parties here hereunder set their hands as of the date written below:
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF FRIDLEY
By
Date:
By
Date:
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ANOKA COUNTY COMMUNITY
ACTION PROGRAM, INC.
By —
Date:
By —
Date:
5K
EXHIBIT A - PROGRAM BUDGET
Source Amount
1995 HOME Allocation =
$75,000
HRA Funds
$24,375
Total So af c as
$99,375
Uses
I. Administration
HOME Funds
$3,750
HRA. Funds
$6,563
Sub-Total
$10,313
II. Home Improvement Grants
HOME Funds
$71,250
HRA Funds
$17,812
Sub-Total
$89,062
7ota( Uses
$99,375
5L
Exhibit B
CERTIFICATION
The Undersigned, on behalf of the Agency, certifies, to the best of his or her knowledge and
belief, that:
(1) No Federal appropriated funds have been paid or will be paid, by or on behalf of the
undersigned, to any person for influencing or attempting to.influence an officer or employee of
any agency, a Member of Congress, an officer or employee of Congress, or an employee of a
Member of Congress in connection with the awarding of any Federal contract, the making of any
Federal grant, the making of any Federal loan, the entering into of any cooperative agreement,
and the extension, continuation, renewal, amendment, or modification of any Federal contract,
grant, loan, or cooperative agreement.
(2) if any funds other than Federal appropriated funds have been paid or will be paid to any
person for influencing or attempting to influence an officer or employee of any agency, a Member
of Congress, an officer or employee of Congress, or an employee of a Member of Congress in
connectiori with this Federal contract, grant, loan, o_ r cooperative agreement, the undersigned
shall complete and submit Standard Form 4-LL, °Disclosure Form to Report Lobbying," in
accordance with. its instructions.
(3) The undersigned shall require that the language of this certification be included in the
award documents for all subawards at all tiers (including subcontracts, subgrants, and contracts
under grants, loans, and cooperative agreements) and that all subrecipients shall certify and
disclose accordingly.
This certification is a material representation of fact upon which reliance was placed when this
transaction was made or entered into. Submission of this certification is a prerequisite for making
or entering into this transaction imposed by section 1332, title 31, U.S. Code. Any person who
fails to file the required certification shall be subject to a civil penalh, of not less than S10,000 and
not more than Sf 00,000 for each such failure.
AGENCY
By:
Its:
Date:
By:
Its:
Date:
5M
(24 CFR 85)
Administrative Requirements for Grants and
Cooperative Agreements to State, Local & Federally
Recognized Indian Tribal Governments
(e, Controc :rng Willi smaii and
minori :yfirms. women's business
en[e_ prise and labor surplus area firm .s.
(1) The grantee and subgrente° will lake
'all i•eces--y affirirative steps to 'assure
that minority firms. women's business
enterprises. and labor surplus area rams
are used when possible.
(2) Affirmative steps shall include:
(i) Placing qualified small and
minority businesses and womens
business enterprises on solicitation lists:
(ii) Assuring that small and minority
businesses. and women's business
enterprises are solicited whenever they
are potential sources:
(iii) Dividing total requirements: waen
economically feasible. into smaller tasks
or quantities to permit maximum
par:icipat ?on by small and minority
bus-Mess. and worrer.'s business
enterprises:
fiv) Es :ablishi-rg deliver: schedules.
••herd the reg::iieme : pe.: -its. k is
enco::rzge participatio-. by small,
and
n:noritr business. and women's
busNess eaerpr:ses:
(vj Using the se:zices and assistarze ,
::ae S -z" Business r- _dministratic =. i
'-rr the Minority Business Deveioprner.: ;
Sgencv o:.::e De;a - :nezt of Co-:.....:__.
(vi) Ree�ijnt! the
joco Ir2cts are :G be et. to take t. ^.e '
i inmative steps listen in paragrzphs
,!t31 of this section..
5N
Exhibit c
e
to
b+
O
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TO: FRIDLEY H.R.A
FROM: CITY OF FRIDLEY
RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES
JUNE 1995
................... ...............................
ADMINISTRATIVE BILLING:
ADMINISTRATIVE PERSONAL SERVICES
ADMINISTRATIVE OVERHEAD
COMPUTER OVERHEAD
(For Micro & Mini comp)
TOTAL ADM.INISTRATJVE BILLING:
OPERATING EXPENSES:
POSTAGE BY PHONE — POSTAGE
POSTAGE BY PHONE — POSTAGE
POSTMASTER — POSTAGE, PERMIT #2886
AT &T — LONG DISTANCE
US WEST — TELEPHONE SERVICE
AMERICAN EXPRESS — LUNCH
BENEFITS EXPENSES:
CITY OF FRIDLEY — HEALTH INS
CITY OF FRIDLEY — DENTAL INS
CITY OF FRIDLEY — LIFE INS
Account #'s for
HRA's Use
Account #'s for
City's Use
14,967.25 101- 0000 -341 -1200
267.83 101 - 0000 - 336 -3000
194.42 101 - 0000 - 336 -3000
4607-0000 - 430 -4107 •15429.50
262 - 0000 - 430 -4332
460 -0000- 430 -4332
460- 0000 - 430 -4332
460- 0000 -430 -4332
460 -0000- 430 -4332
460 -0000- 430 -4337
TOTAL OPERATING EXPENSES:
262 -0000- 219 -1001
262 -0000- 219 -1100
262 -0000 -219 -1200
TOTAL BENEFITS EXPENSES:
TOTAL EXPENDITURES — JUNE 1995
FUe : %123DATAVHRA %MFXl3lWNG.wkt Details
13.54
236- 0000 - 336 -3000
12.55
236- 0000 - 336 -3000
1,060.46
236- 0000 - 336 -3000
4.15
236 -0000- 336 -3000
13.29
236 - 0000 - 336 -3000
44.33
236- 0000 -336 -3000
1.148.32
0.00 236 -0000- 219 -1001
41.06 236 -0000- 219 -1100
0.00 236 -0000- 219 -1200
41.06
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