HRA 12/14/1995 CANCL - 6293HOUSING & REDEVELOPMENT AUTHORITY MEETING
THURSDAY, DECEMBER 14, 1995
7:30 P.M.
PUBLIC COPY
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1996 MEETING DATES
HOUSING & REDEVELOPMENT AUTHORITY - 7:30 P.M.
Thursday:
♦
January 11th
♦
February 8th
♦
March 14th
♦
April 11th
♦
May 9th
♦
June 13th
♦
July 11th
♦
August 8th
♦
September 12th
♦
October 10th
♦
November 14th
♦
December 12th
4�
CITY OF FRIDLEY
HOUSING & REDEVELOPMENT AUTHORITY MEETING
NOVEMBER 9, 1995
CALL TO ORDER:
Chairperson Commers called the November 9, 1995, Housing and
Redevelopment Authority meeting to order at 7:30 p.m.
ROLL CALL:
Members Present: Larry Commers, Virginia Schnabel, Jim
McFarland, John Meyer, Duane Prairie
Members Absent: None
Others Present: William Burns, Executive Director
Barbara Dacy, Community Development Director
Jim Hoeft, HRA Attorney
Jim Casserly, Financial Consultant
Rick Pribyl, Finance Director
Grant Fernelius, Housing Coordinator
Craig Ellestad, Accountant
David Zuk, 122 - 102nd Avenue
Carl Zuk, 281 Rice Creek Terrace
Dave Ristamaki, 18225 Deerwood Lane,
Wyoming, Minnesota
Oliver Tam, 1160 Fireside Drive
Brad Dunham, Whitney Homes
Diane Schommer, 543 Janesville Street
PPROVAL OF SEPTEMBER 14. 1995. HOUSING AND REDEVELOPMENT
AUTHORITY MEETING:
MOTION by Ms. Schnabel, seconded by Mr. Prairie, to approve the
September 14, 1995, Housing and Redevelopment Authority minutes
as written.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON CONNERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
CONSENT AGENDA:
I. CONSIDER APPROVAL OF CONTRACT FOR PREPARATION OF TRAFFIC,
NOISE. AND AIR STUDY, AND PREPARATION OF INDIRECT SOURCE
PERMIT APPLICATION
2. CONSIDER APPROVAL OF CONTRACT WITH LARKIN HOFFMAN DALY &
LINDGREN, LTD., FOR IMPLEMENTATION SERVICES FOR LAKE POINTE
ENVIRONMENTAL PERMITS
A I
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9. 1995 PAGE 2
3. CONSIDER RESOLUTION PLEDGING INCREMENTS FOR THE SERIES 1995A
BOND ISSUE
4. HYDE PARK HOUSING PROGRAM UPDATE
5. HOUSING PROGRAM UPDATE
6. HOUSING REPLACEMENT PLAN AND SCATTER -SITE PROGRAM UPDATE
7. SOUTHWEST QUADRANT BUDGET UPDATE
8. REVENUE AND EXPENSES
Mr. Ellestad distributed copies of additional expenses for
approval. These additional expenses reflect the pay off of the
three -year temporary bonds issued in 1992. These bonds are
maturing in December.
Mr. Hoeft stated the 1995A bonds are the same type of bond. This
is a three -year issue and would have the opportunity for early
call and reissue.
Mr. Commers asked what expenses are associated with the issuance
of these bonds.
Mr. Ellestad stated the total allowable expenses budgeted is
approximately - $10,000.
Mr. Commers asked if there was any payment or principal reduction
on the original issuance.
Mr. Ellestad stated no, there was only interest. This will be
only interest also.
NOTION by Mr. Prairie, seconded by Mr. Meyer, to approve the
consent agenda as presented.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COM ORO DECLARED
THE MOTION CARRIED UNANIMOUSLY.
CTION ITEMS:
9. CONDUCT PUBLIC HEARING REGARDING SALE OF PORTION OF 533
JANESVILLE STREET N.E.. AND APPROVE RESOLUTION AUTHORIZING
THE SALE THEREOF
NOTION by Ms. Schnabel, seconded by Mr. Meyer, to open the public
hearing.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED AND THE PUBLIC HEARING OPEN AT 7 :35 P.M.
HOUSING A REDEVELOPMENT AUTHORITY MTG.. NOVEMBER 9. 1995 PAGE 3
Mr. Fernelius stated the area in question is approximately 1,375
square feet of the parcel located at 533 Janesville Street. One
parcel measuring approximately 20 feet x 50 feet would be
conveyed to Mr. John Olson at 538 Kimball Street, and another
parcel measuring approximately 15 feet x 25 feet would be
conveyed to Mr. John Koehler at 528 Kimball Street. Both parties
have indicated an interest to pay the HRA $875.00 ($0.60 per
square foot) plus any survey and legal costs involved in the
transaction.
Mr. Fernelius stated the sale was subject to approval of a Lot
Split by the City Council. The Planning Commission approved the
Lot Split on October 18, and the request will be considered by
the City Council at their next meeting. If approved by the City
Council, the sale can proceed.
Ms. Schnabel asked if there were any easements through these
parcels.
Mr. Fernelius stated no.
No one was present from the public to comment on this item.
NOTION by Ms. Schnabel, seconded by Mr. Prairie, to close the
public hearing.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COM ORO DECLARED
THE MOTION CARRIED AND THE PUBLIC NEARING CLOSED AT 7:39 P.M.
Mr. Commers stated, since there are no objections or comments, he
would recommend approval of the request.
NOTION by Mr. Prairie, seconded by Ms. Schnabel, to approve a
Resolution to Approve the Sale of a Portion of the Property at
533 Janesville Street N.E.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COM ORO DECLARED
THE MOTION CARRIED UNANIMOUSLY.
10. CONDUCT PUBLIC HEARING REGARDING SALE OF SIX LOTS, LOCATED
AT 5720 POLK STREET 5973 - 3RD STREET, 5981 - 3RD STREET,_
5924 -2ND STREET 533 JANESVILLE STREET, AND 623 LAFAYETTE
STREET AND APPROVE RESOLUTION APPROVING THE SALE THEREOF
NOTION by Ms. Schnabel, seconded by Mr. Meyer, to open the public
hearing.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COM ORO DECLARED
THE NOTION CARRIED AND THE PUBLIC HEARING OPEN AT 7:42 P.M.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 4
Mr. Fernelius stated six sites were advertised for sale under the.
scattered -site program. Staff advertised for bids in the Twin
Cities Builders Association and also placed signs on the lots.
From that, staff received approximately 30 inquiries. Staff has
received offers on the lots, as follows:
5720 Polk Street - Four offers were received. The high bidder is
Whitney Homes with a bid of $20,000.
5924 - 2nd Street - Three offers were received. The high bidder
is Tam's Inc. with a bid of $12,000.
533 Janesville Street - Five offers were received. The high
bidder is Diane Schommer with a bid of $19,500.
5973 - 3rd Street - Three offers were received. The high bidder
is Tam's Inc. with a bid of $6,000.
5981 - 3rd Street - Three offers were received. There was a tie
in the bidding with Tam's Inc. and Whitney Homes both bidding
$4,000.
623 Lafayette Street - Three offers were received. The high
bidder is Tam's Inc. with a bid of $18,500.
Mr. Fernelius stated, at this point, the high bidders will need
to execute a sale and development agreement with the HRA within
45 days or December 24, 1995; and provide proof of a letter of
credit. The HRA would then approve the sale and development
agreements either in December or January. After the agreements
are approved, each bidder would then need to submit their house
plans and site plans for the HRA to review and approve. The
bidders then must finalize their construction schedule and close
on the actual sale of the lots in order to have title to the
property. They would then proceed to get the building permits
and any other approvals required. Work can then begin with the
understanding that the work is to be completed by June 30, 1996.
Mr. Fernelius stated staff's recommendation is to award the sale
of the properties to the high bidders subject to each bidder
agreeing to a sale and development agreement with the HRA by
December 24, 1995. Staff also recommends the HRA reject the
offers received for 5981 - 3rd Street and that this property be
rebid with a deadline of December 1, 1995.
Mr. Conners asked the location of this lot.
Mr. Fernelius stated both the 3rd Street properties are located
near the slip -off ramp from University onto 3rd Street. The lots
back up to University Avenue. This is a high traffic area and
there are several multi - family propertios in that area. There is
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 5
a concern on the part of the bidders that the house values may
not be very high. The bids reflect this concern.
Mr. Meyer stated the HRA has had experience with Whitney Homes.
He asked Mr. Fernelius what staff knew about the other high
bidders.
Mr. Fernelius stated he had done some checking. Mr. Tam is the
owner of Tam's Rice Bowl in Fridley. He has built a number of
homes, one of which was local. He has submitted some drawings of
the potential house plans that he would offer to prospective
buyers. He is licensed by the State of Minnesota as a building
contractor, and he has provided a list of his materials providers
and subcontractors. He is in the process of obtaining a letter
of credit from Northeast State Bank. He should be getting
approval on that in the next few weeks. If the award is made
tonight, he will have 45 days to provide that letter of credit
and firm up the house plans to be submitted for approval.
Mr. Fernelius stated Ms. Schommer is working with Four Diamond
Builders based in Coon Rapids. They have built 15 homes in the
two years they have been in business in the $90,000 to $145,000
price range in the northern suburbs. They are a licensed
building contractor. According to the City's building official,
they have a good reputation. Staff believes all bidders who have
submitted bids are responsible bidders.
Mr. Meyer asked if, in the case of Ms. Schommer, they were
dealing with an individual or a company.
Mr. Fernelius stated they were dealing with an individual in
terms of a development agreement. The builder will be providing
a letter of credit on Ms. Schommer's behalf. She has a building
contractor set up who would like to proceed. The builder has
submitted plans for a split entry home that he would like the BRA
to approve so they can get the building permit and start
construction this fall.
Mr. Meyer asked why the builder was not the bidder rather than
the individual.
Mr. Fernelius stated this was not set up as a requirement. The
bids were open to anyone who could meet the requirements. The
biggest requirement was a letter of credit. Whether the
individual or builder provides that letter of credit, the HRA has
the security it needs and Ms. Schommer has met the requirements
in that regard.
Mr. Prairie asked if both names could be put on the agreement.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 6
Mr. Hoeft stated they could but Ms. Schommer will be the only
party that is liable. The builder may want to be included on
those documents because he will be the one putting out the cash.
Mr. Commers stated he presumed Ms. Schommer would live on the
property. She has a builder to build her home. He did not see
that as being unusual.
Mr. Meyer asked, if we are giving a builder property to build a
home, why enter into an agreement with an individual.
Mr. Hoeft stated the homeowner is buying the lot.
Mr. McFarland stated the HRA is protected by the letter of credit
and the mortgage. The HRA has ample collateral.
Mr. Hoeft stated the bidder must meet all the requirements.
Mr. Meyer asked why staff recommended the property at 5981 - 3rd
Street not be sold.
Mr. Fernelius stated this was done to get a higher price and to
resolve the issue of who will actually get the lot.
Mr. Meyer stated there is also the option of selecting another
bidder than the high bidder. If we wish to award the lot to
Habitat for Humanity for $1.00, do we have the option of doing
that?
Mr. Fernelius stated the guidelines adopted by the HRA indicates
the bids would be awarded to the highest, most responsible
bidder.
Mr. Hoeft stated, because we have determined through staff's
investigation that the two bidders who tied for high bid are
responsible, we cannot just kick them out and award the bid to
someone else. We have the opportunity to reject the bids in this
case because there is a tie and then the HRA could make a policy
decision that, instead of putting this property on the floor,
they want to donate the property or sell the property for $1.00
to Habitat to Humanity. He did not feel the HRA could do that at
this point because that is not how the bids were presented.
Mr. Meyer stated, if we have determined a lot is not highly
esteemed by the bidders and there is a possibility for Habitat
for Humanity coming in and building a house, he would be o
interested in considering something like that.
Mr. Hoeft stated this has done that a number of times in Columbia
Heights where they have a number of new houses under the same
type of development contract. They have had some success there.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 7_
Mr. Commers asked for comments from the public.
Mr. Dunham stated Whitney Homes has the financing approved at the
same bank so they do not need the 45 days with respect to their
bid on 5981 - 3rd Street. They have a letter of credit for all
the lots for which they have bid. He felt Whitney Homes had done
a good job on those lots they have done. He provided pictures of
the homes built on these lots. He would like to suggest they get
the second lot.
Mr. Commers stated he was not sure that would make-a difference
in terms of the criteria. They have had good experience dealing
with Whitney Homes.
Mr. Dunham stated he makes the case that Whitney Homes is
responsible and ready. They have all the licenses, the letter of
credit, and would not need the 45 days.
Mr. Prairie stated the rebid date is December 1, which is
relatively soon.
Mr. Hoeft stated, with regard to the responsibility factor, staff
has made its investigation. On that information, we have made a
determination that Tam and Whitney are responsible bidders.
While he understands Whitney Homes' position, Whitney must
remember they were in the same position as Tam's in the last
round of bids because we had no experience with them either.
Whitney proved to work out well, and the City had success in
dealing with them. We do have criteria that allows Tam's Inc. to
provide the financing and security in 45 days. If they did not
do that and because the award is contingent, the HRA would not
then have to rebid these properties but could move down to the
next highest responsible bidder. At that point, they could award
the bid to Whitney. Because Tam's Inc. in a responsible bidder,
we*have to allow them to meet the 45 day requirements. If they
do not perform, then we have a history to use for any other lots
that come up subsequently.
Mr. Conners asked if there were any other lots available through
the scattered -site program.
Mr. Fernelius stated one lot is now available. The goal for next
year is to have the same number as this year. Through the
housing replacement program, they can do up to ten lots per year.
Mr. Tam stated his family has been in Fridley for 23 years and
operates a restaurant here. They have been operating the
restaurant all that time. That shows they are just as
responsible as any others in the community. He appreciated all
the help and assistance from the City over the years.
f
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 8
Ms. Schommer stated she made the bid herself. The lot is next
door to her mother's house. She has been pre- approved. She has
checked the builder. She has given Mr. Fernelius the plans. The
house plan that she picked is already built in Elk River, if
anyone would like to look at it. She has all the financing and
every is set to go. They plan to close on February 29, if
everything goes well. She did not know what else she would need.
There were no additional comments from the public.
MOTION by Ms. Schnabel, seconded by Mr. Prairie, to close the
public hearing.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED AND THE PUBLIC HEARING CLOSED AT 8:03 P.M.
Mr. Commers stated staff's recommendation was included in the
agenda packet. He asked to make a recommendation to award the
lots to the five highest bidders and to withdraw the lot at 5981
- 3rd Street from consideration of the award.
Mr. Fernelius distributed a revised resolution which reflects the
this information.
OTION by Mr: Meyer, seconded by Mr. McFarland, to approve a
Resolution Authorizing of Sale of Real Property.
Mr. Meyer stated he assumed the omission of 5981 - 3rd Street
becomes a mute point and that this does not need to be mentioned
in the resolution.
Mr. Prairie asked if they needed to move to rebid this property
by a certain date.
Mr. Fernelius stated this could be done by a separate motion.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON DECLARED THE
MOTION CARRIED UNANIMOUSLY.
MOTION by Ms. Schnabel, seconded by Mr. Prairie, to authorize the
rebidding of the property located at 5981 - 3rd Street with the
bids to be submitted by December 1, 1995.
Mr. Meyer asked if there was any interest in assigning this lot
to Habitat for Humanity.
Mr. Prairie felt this would have to be done before the property
was open for bids.
Ms. Dacy stated that a Councilmember had suggested the same idea.
Staff concluded that, for the purpose of this process, it would
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 9
be best to continue the process as outlined and to rebid the
property. However, if the HRA wants to identify some of the lots
in the scattered -site program for low to moderate income housing
program and assign the property to Habitat for Humanity, that is
within the HRA ,1s purview. Habitat for Humanity has completed two
homes in the City. The first building constructed is in need of
maintenance. The second home is newer. Because we have gone so
far in this process, staff recommends to continue as outlined.
In the future, it is certainly an option. As a word of caution
with the housing replacement program, staff wants to include
those in the replacement program in order to get the property
back on the tax rolls. Lots for Habitat for Humanity would not
be tax exempt. She felt a policy statement should be developed.
There are costs involved with acquisition and demolition.
Mr. Prairie asked, if the HRA were to do this next year, would
you want to identify a parcel before bidding.
Ms. Dacy stated yes.
Mr. Commers stated, if the property were sold through that
program, the taxes would not be affected.
Ms. Dacy stated this was correct. Habitat for Humanity indicated
to Mr. Fernelius when they made their proposal that they would
need at least.one year to construct a home in order to-put
together the volunteer effort. If the City wants to pursue that,
perhaps they could find a neighborhood.to sponsor a lot and some
of the work. This is an opportunity for neighborhood
involvement. Staff has not, at this point, had time to put a
policy together.
Mr. Commers asked if there was any lot criteria. required.
Mr. Hoeft stated there are currently two properties in Columbia
Heights under contract. Habitat for Humanity wants a one -year
contract for one property and a two -year contract for the other.
They were interested in two other lots but there were some soil
concerns so they did reject those two lots.
Mr. Meyer stated the HRA was not out nearly as much money on a
$4,000 lot as they would be next year on a $15,000 or $20,000
lot. If there is any interest in giving a less expensive lot to
Habitat for Humanity, the HRA would not lose as much money.
Ms. Schnabel stated they must also consider the cost to acquire
the lot and for demolition. This has nothing to do with what the
bid is worth.
Mr. Meyer stated the HRA goes through similar expenses on all the
lots. If the lot is given to HaRRJtat,, there would not be extra
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 10
costs incurred.
Mr. Commers stated he felt, in this instance, they were too far
into the process to do this.
Ms. Dacy stated staff's reason for not recommending that as part
of this process is that we have responsible bidders ahead of
Habitat.
Mr. Hoeft stated in this case there is not a problem because of
the tie bid so it does provide an opportunity to make a policy
decision before rebidding. He agrees they may be too far into
the process. From a policy standpoint and from his experience
with Habitat, it may be better to approach them now with regard
to some lots we may have available in the spring or summer
because we can then have things up and running with them. They
sometimes require two years to get something on the lot. The HRA
must decide if they want property to sit empty for a period of
time or do they.want to work with Habitat to get something in
place.
Mr. Meyer stated he would assume that, if they made a bid, they
are ready to go. They may still want two years. Are we saying
we would preclude any interest in Habitat operation because it
may be one or two years? Regarding the statement that we are too
far into the process, we are rejecting bids and want rebids by
December 1. It is rather odd for us to claim we are too far down
the process to reverse our tracks. He brings it up for
discussion. It seems that this is an ideal time and an ideal lot
to do something for Habitat.
Ms. Dacy stated she did not disagree, but there is a policy issue
that the HRA and City Council needs to establish. In meeting
with Hyde Park residents, staff has told residents this would be
a part of the scattered -site program and that market rate housing
would be constructed. Staff has made some assurances to the
neighborhood. Staff continues to recommend that the lot be rebid
and that staff be directed to establish a policy for the future.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON CONNERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
11. CONSIDER RESOLUTION MODIFYING THE REDEVELOPMENT PLAN AND
CREATING TAX INCREMENT FINANCING DISTRICT NO. 14
Ms. Dacy stated the property is south of 73rd Avenue. The tract
is two lots consisting of approximately 6 acres. The frontage
road to the west is the University Avenue service road and 73rd
is to the north. Mr. John Allen of Industrial Equities is
proposing a 87,600 square foot, one -story building which would
span from west to east across the property with loading docks to
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9. 1995 PAGE _11
the south. The visitor and employee parking would be to the
north side of the building.
Ms. Dacy stated this project has been discussed previously. Mr.
Casserly met with Mr. Dennis Zylla, who manages Northco Business
Partnership. Soil tests have found soil problems throughout the
site. Because of these soil problems, they will have to excavate
a significant amount of soil from the site and replace it. The
most recent figures indicate that up to 27,000 yards of fill
would be imported into the site. Mr. Casserly had worked on a
soil correction assistance package for 8% to 10% of the project
costs which would be approximately $280,000 to $350,000. The
assistance would be split with 50% a grant and 50% a loan. In
order to provide the assistance, an economic development district
is proposed. The site is in a project area. If the BRA extends
the life of the district, it would go to the year 2006. The City
and the HRA could choose to terminate the district early or 2001
when the grant is recouped.
Ms. Dacy stated staff recommends the HRA approve the proposed
resolution authorizing modification to the project area and to
create a tax increment financing district.
Mr. Commers asked what the allocation was between the funds. Is
the movement of the storm sewer included in this?
Ms. Dacy stated yes, that is included. A storm sewer bisects the
site. Northco installed the storm sewer when the property was
originally platted anticipating two buildings..-The storm sewers
would be rerouted so the water goes into a pond toward the south
of the site, through a pipe to another pond to the north, and
then into the storm sewer system. Rice Creek Watershed District
prefers the proposed plan because it takes water through ponds
for treatment. The soil correction costs are approximately
$350,000 and the storm sewer costs are approximately $40,000.
Mr. Prairie asked if there was another TIP district close to this
site.
Ms. Dacy stated yes. The BRA created a TIP district in 1989 on
the site proposed for the liquor store. Northco was looking at
an office development but did not proceed. That is TIP district
#10.
Mr. Commers stated the HRA does not at this time have to make a
decision as to the life of the district. Can the EI A make it
full term and then reduce the amount of time in the future?
Mr. Casserly stated yes. TIP districts are usually set up for
the maximum duration. .
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 12
Mr. Commers asked for a cash flow analysis.
Mr. Casserly stated page 11M of the agenda packet shows the cash
flow analysis. On the estimated tax increment, there is $0.5
million on this project. He would recommend the HRA keep about
20% of the increment for program expenses which leaves available
increment of $420,000 for project expenses. They need to work
out the details of the development agreement which would come
back to the HRA in December. After working out the details of
the development agreement, he thought the level of assistance
would be approximately $300,000. One -half would be a loan and
one -half a grant. The loan would be repaid over a period of
time. Generally, the first two years accrue interest but defer
it, add it to the principal, and amortize the principal over
eight years. The project would be fully constructed in'1996 and
fully assessed in 1997. They would pay full taxes in 1998.
Mr. Casserly stated they would have nine tax increment years.
Because of the nature of the district, the last year or two
generates hardly any tax increment. This is very much like the
project the HRA was doing eight to ten years ago.
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve a
Resolution Modifying the Redevelopment Plan for Redevelopment
Project No. 1 and the Tax Increment Financing Nos.. 1, 2, 3, 6, 7,
9, 10, 11, 12 and 13 to Reflect Increased Project Costs Within
Redevelopment Project No. 1, and Creating Tax Increment Financing
District No. 14 and Adopting a Tax Increment Financing Plan
Relating Thereto.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
12. CONSIDER RESOLUTION TO APPROVE CONTRACT FOR EXCLUSIVE
NEGOTIATIONS WITH MEPC
Mr. Commers stated the HRA reviewed a draft of this contract
earlier. He asked Ms. Casserly to review the changes that had
been made.
Mr. Casserly stated there are only a few changes. They have
tried to establish some market values. They have been talking
about an office tract and a smaller commercial tract. This
agreement tries to lay the groundwork for MEPC to promote and
develop the site and to try to continue with the HRA's original
concept that it would help with parking treatments if they got
the right kind of density. This agreement recognizes that the
first building that goes in, particularly on the office tract, is
probably going to have surface parking. The next building that
goes in must have some type of structured parking and will
probably have to share the .structured parking with the first
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 13
building. In order to get the first building going in the office
tract, they want to encourage MEPC to be as aggressive as they
can. We set the parameters that it must be a minimum of three
stories. We have had a lot of discussion about this. They are
looking to move as quickly as they can but not to build
structured parking until the first building goes in. They would
sell the site for the first building and then put that purchase
price in reserve to put those funds back into the property to
help with the structured parking.
Mr. Casserly stated the rest of the agreement talks about setting
the time frame for such things as developing focus groups,
marketing plans, reports back, etc.
Mr. Casserly stated one other issue that came up which they
stressed is that, on the commercial tract, MEPC feels strongly
they need to develop a substantial portion of the commercial
tract to provide the amenities to get the kinds of office
development they want for the office tract. If the commercial
tract is developed first, it is with the office tract in mind and
in support of a high quality office development.
Mr. Prairie asked for an example of the type of amenities that
would be provided.
Mr. Casserly stated MEPC had mentioned a banking facility,
restaurant, the potential of have a day care facility, and /or the
potential of a hotel and lodging facility.
Mr. Prairie thought this would be a short, select list.
Mr. Casserly stated the amenities would'not be retail, but rather
service oriented activities. They want to develop focus groups
where they invite people in, talk about the development they
would like to see, and what kind of amenities are needed to
maximize the development. MEPC then would develop a master plan
for the site. This will be back before the HRA numerous times.
Mr. Casserly stated, at this point, it is important to get MEPC
going. They have a willingness to provide support. We do have
them on a pretty good time frame. It takes some time to put
these things together. From what he has seen, we appear to be in
a good development mode these days. There does seem to an
increasing need for space and, hopefully, we will be able to take
advantage of the low interest rates and the increased need. The
goal is to get a first office building under construction by July
1, 1997. If they cannot start by that date, we can get time
added on to that. The idea is to have the plans and programs put
together next year.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 14
Mr. Prairie stated the HRA's original time frame and MEPC's time
frame were different. Does this agreement reflect a time frame
that is somewhere in between these?
Mr. Casserly stated yes. MEPC was looking for two full years.
We were looking for a maximum of 1.5 years. We ended up with 1.5
years with an ability to extend it for 90 days if they have
signed agreements, etc.
Ms. Schnabel stated page 12I stated the agreement shall terminate
if a redevelopment contract is not executed by July 1, 1997. Is
that this contract?
Mr. Casserly stated no. This is a preliminary agreement. We
need to enter into a more formal, extensive agreement with them.
This agreement protects them and lays out some of the broad terms
on how we want the site developed and what they need to do. We
will need an extensive redevelopment contract but it is premature
to do that at this point.
Ms. Schnabel stated this agreement says the construction needs to
start on the same day as the termination of the contract. That
seems tight.
Mr. Casserly stated the construction date could be moved forward.
He left that in there because this will be negotiated as we go
along. He sees a contract in place by the end of next year. If
things are not going well, he would not want to take the time to
work through a contract if they are not making progress.
Mr. Commers stated he understands there is a write down of the
land with them assuming responsibility for structured parking.
We have to define the amount of structured parking.
Mr. Casserly stated this was correct. Parking will be a part of
the redevelopment agreement.
Mr. Casserly stated he is concerned that there is an open ended
commitment by the HRA for the infrastructure.
Mr. Casserly stated the HRA has the ultimate approval over that.
We have to agree to the master plan. If the master plan that we
agree to has some reconfiguration of load or utilities, we have
to take that into account. The only reason we would want to
change is for a better plan. It is open ended, but we have
control over that.
.Mr. Meyer asked Mr. Casserly to define Class A office space.
Mr. Casserly stated this is difficult to define.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9. 1995 PAGE 15
Mr. Meyer stated the agreement has something defined as Class A
office space but no definition of what Class A is. The building
can be up to three stories or 50,000 square feet. That is a
small building. This is also saying they can forget the office
space for some indefinite time and put up commercial. These
things worry him. Once the first office building is constructed
and there may be some commercial, the commercial that is put in
is dependent on a viable office space already in. The statement
that they need the commercial in first does not ring true to him.
You do not put in a bank or day care center or restaurant, etc.,
on empty land. You wait until there are people there. If they
were to do this, what is our risk?
Mr. Prairie stated the commercial would bother him more than the
Class A part because we are going to have a chance to look at
what goes in there. However, having commercial before the office
seems backward.
Mr. Commers stated they could end up with something on the
commercial tract that is marginal and nothing on the office
tract.
Mr. Meyer stated the commercial could also attract something less
than Class A.
Mr. Casserly stated in the original design we could not develop
commercial until a certain percentage of the office tract had
been developed or under contract. Of the items negotiated, that
was the one MEPC felt the strongest about. It seemed to him you
would not want to do the commercial tract until you saw the type
of office development. MEPC said it was probably just the
opposite. The way they can attract high quality tenants is if
they are developing simultaneously parts of the commercial tract
so the facilities will be available. MEPC is saying that has
been their experience.
Mr. Casserly stated they need to sort through the process. There
is a master plan in process. The HRA has a tremendous amount of
control over what goes in there.
Ms. Dacy stated, in the S -2 district, the HRA and City Council
must approve any use. If MEPC wanted a day care center first,
they would have to do a plat and other issues, and come back here
to get HRA approval. The HRA determines if the use is consistent
with the goals of the redevelopment plan. The issue of what
comes first will be discussed.
Mr. Meyer asked, if the HRA has a veto, what is the sense of this
document.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995_ PAGE 16
Mr. Casserly stated this document protects them. They will be
spending money out -of- pocket plus their time. This document is a
loose agreement. We could spend more time defining and working
through issues. We are still not exactly sure we can accomplish
what we want to see on the site. The process being suggested in
this document is what has to evolve over the next six months and
how we are going to accomplish these things. There is a process
where the HRA is to do a complete review on or about July 1,
1996.
Mr. Prairie stated this is fine as long as this does not mislead
MEPC as to what our intentions are.
Mr. Commers asked if a statement could be added to Section
2.2.(E) to the effect that this is subject to discussion and
mutual agreement of the HRA.
Mr. Casserly stated a statement could be more specific and state
this is "subject to individual approval by the HRA."
Mr. Meyer expressed concerns that this would still give the
developer the right to first develop the commercial amenities
before having the office use.
Mr. Commers stated that is why he recommended modifying the
paragraph giving MEPC the authority to develop the commercial
tract but making it clear to let them know that we retain very
specific project -by- project veto power without having to base it
on some kind of reasonable standards. If we do not like it, we
should be able to say no even though in other respects it may be
appropriate.
Ms. Schnabel asked if they wanted to say the commercial could not
be developed until they have provided some number of tenants for
an office building.
Mr. Commers stated that is the issue. MEPC states they need some
commercial to get the office.
Ms. Schnabel stated she understood they wanted to do the
commercial and office simultaneously.
Mr. Commers suggested that, once MEPC gets a certain number of
square feet released such as 50,000 square feet, the HRA would
then release a specified amount of commercial. Is that too
complicated?
Mr. Casserly stated he did not know how many uses could be made
on the site. He thought MEPC was saying they want the best
commercial amenities to attract the best kind of office user. If
that is left to the HRA's discretion, then I think the HRA would
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 17
be reasonably secure. There will be a consensus between MEPC and
the HRA about the amenities promoted. He could put in language
to be sure this is at your discretion and control.
Mr. Burns suggested the language, "While the office tract is a
priority, the HRA will consider commercial development that the
developer feels is essential for attracting users of office
space."
Mr. Prairie stated he did not think having a first class hotel on
the site would be a problem. A hotel could function on its own.
He was not sure about a restaurant. After that, the issue gets
more unclear. MEPC might want to market what they have up front.
He could not see a day care center going in first.
Mr. Burns stated he was also concerned. He was not sure of the
City Council and public's reaction to developing a restaurant
before an office development.
Mr. Meyer thought Mr. Burns suggestion was good. If we are going
to go to a restaurant, are we going to do something by itself on
40 acres where there may be an office? That is not the sort of
thing that would attract an office.
Mr. Commers asked Mr. Casserly to discuss this with MEPC and see
where it leads and then come back.
Mr. Casserly asked, because of time, would it be possible for
representatives of the HRA to review the language with the
understanding that there will be subsequent language that
addresses this concern. He would like to revise the document and
have it signed in the next few days.
Mr. Burns stated he would like to get started. He suggested
staff amend the document or the HRA give staff some flexibility
where the HRA can agree to everything else but this particular
section and give Mr. Casserly, Mr. Commers, and him permission to
work out the specific language prior to signing the document.
Mr. Meyer asked if anyone is concerned about a 50,000 square
foot, three -story building that is defined as loosely as Class A.
Mr. Burns stated we went into the process in the very beginning
and established these criteria. That is what we told MEPC we
wanted as a minimum. If we start changing that now, he thought
they would be guilty of reneging on their terms.
Mr. Commers agreed that 50,000 square feet is not a large
building. Usually these buildings have a 25,000 or 40,000 square
foot footprint.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 18
Ms. Schnabel asked if Mr. Meyer was not comfortable with the
controls the HRA has.
Mr. Meyer stated he was not comfortable in the sense that the
commercial can go first. There should be no allowance that the
commercial go first. The office should come first and then the
commercial. Mr. Burns made the point which gives the HRA
authority to negotiate. He thought they should take a stand that
the commercial cannot go first.
Mr. Burns stated they can try that and he thought that was
reasonable.
Mr. Meyer stated, regarding the 50,000 square feet, the HRA did
have a commitment to MEPC last March so that is acceptable.
Mr. Commers suggested that Mr. Casserly or Mr. Burns talk to MEPC
and see what-the best is that they can do. At that point, call
each HRA member and take a vote over the .phone as to whether the
HRA can support it. If the HRA does support, he will sign the
contract before the next meeting. While everyone is well
intentioned about what will happen, we also want to be careful.
_Mr. Burns asked the HRA to approve the agreement as it stands
with the exception of Section 2.2.(E) which would'be amended and
,a poll of the members be taken.
MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve a
Resolution Authorizing Execution and Delivery of a Contract for
Executive Negotiations By and Between the Housing and
Redevelopment Authority In and For the City of Fridley and MEPC
American Properties, Inc., subject to renegotiation of Section
2.2.(E) and approval of the language by the Housing and
Redevelopment Authority.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
Ms. Dacy provided an example of a brochure and advertisement for
the Lake Pointe site.
INFORMATION ITEMS:
13. SOUTHWEST OUADRANT UPDATE
Ms. Dacy stated the City Council has attempted to talk about the
senior condominium component on several occasions but were unable
to'reach a consensus. Since that meeting, the City Council has
been unable to discuss this item for a variety of reasons. Staff
will try to discuss this issue with the City Council within the
next ten days. She will provide an update at the next meeting.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 19
Ms. Schnabel stated she had attended the Council meeting where
the senior housing component was discussed. Initially, four
Councilmembers wanted to keep the condominiums and one was in
favor of doing something else. When the meeting was over, this
had changed to two Councilmembers who still wanted to keep the
condominiums as proposed and three who were willing to consider
something else.
Mr. Burns stated part of what makes this difficult is that the
Councilmembers are waiting for the property condemnation process
to end and to be more certain of the numbers. Staff also needs
to develop other alternatives to the senior housing issue.
Ms. Schnabel stated two Councilmembers had been approached by a
number of senior citizens who wanted to have housing, so the
Council feels they have made a commitment despite the fact that
the dollar amount has changed. They talked about other senior
housing in the City but the Council felt this was a good
location.
Mr. Commers stated he had read the article included in the agenda
packet and asked what it was they were saying.
Ms. Dacy stated-they are . trying to say that Rottlund - is working
with a senior housing developer on a project in Minnetonka.- What
the author does not understand is the Minnetonka project is for
rental apartments for seniors. In Fridley, we are talking about
owner occupied. Ms. Dacy was also not sure if the author was
referring to the empty nest housing when talking about costs.
Mr. Commers stated he interpreted the article as saying Rottlund
can build 115 senior housing units in Minnetonka but they cannot
do so in Fridley unless we subsidize the project.
Ms. Dacy stated the development they are talking about is rental.
The $115,000 mentioned in the article might be applying to the
proposed townhomes.
Mr. Commers asked staff to call the development representative
and see what they are talking about for this project.
Mr. Commers stated he understands that, if they get the
Cherrywood Apartments for the same per unit costs as the Keefe
award, we will have to add another $250,000 to our.budget rather
than what we have been concerned about.
Ms. Dacy stated this is correct. The Keefe award was not as high
as originally thought. They are appealing on the Suh
condemnation.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 20
OTHER BUSINESS:
14. FRANK'S USED CAR SITE
Mr. Burns stated the HRA authorized at the June meeting the
purchase of the Frank's Used Car site. At that time, staff did
not anticipate purchasing the two lots south of the estate. If
we would acquire those two lots to the south of Frank's and the
additional two adjacent residential lots, perhaps they could
create a residential development in this area. This would total
2.4 acres for possible development. He would like to see a
townhouse development. Ms. Dacy would like to see single family
homes and /or senior housing. He made some preliminary contacts
with the owners of these properties. He talked with the
representatives of the Gabrelcik estate and negotiated a price
for the two additional properties.
Mr. Burns stated an addendum was added to the purchase agreement
that would require the heirs to take care of the environmental
issues including capping a well, removing fuel tanks, cleaning up
the ground around the tanks, removing fluorescent lights and
ballasts, and removing asbestos, if any. They have capped the
well, removed fluorescent lighting.and ballasts, removed the
tanks and cleaned the soil.. Mr. Burns understands the heirs are
about to get a closure letter. The only thing holding this up is
the MPCA has concerns.about whether the soil has been disposed of
properly.
Mr. Burns stated, in negotiating with the Gabrelcik's for the two
additional lots, he agreed the City could take responsibility for
asbestos removal.out of the purchase agreement. The attorney for
the family came back with a second addendum in response. There
is no disagreement in principle, but there is some disagreement
over the language in the second addendum.
Mr. Burns asked the HRA to approve the purchase of the Frank's
Used Car site and the two additional vacant lots for $165,000
with the understanding that,-.before closing on the property, we
will have a closure statement and assuming they can work out the
language included in the second addendum.
Mr. Commers asked if the dispute was over the economics.
Mr. Burns stated no. The dispute is in the interpretation of the
language. If they get a closure statement from the MPCA, it
should be all right.
Mr. McFarland asked if they would be assuming liability for any
lingering pollution.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9. 1995 PAGE 21
Mr. Burns stated that is something the attorney would have to
clarify.
Mr. McFarland stated, in his experience, they had been given a
closure statement from the MPCA but it said that, if ground were
ever broken, it would have to be re- examined and any pollution
found, if any, would have to be cleaned up before construction
could begin. He also did not know if the petrol fund transfers
from owner to owner.
Mr. Commers stated, if we get a contingent closure letter, that
opens it up again when starting construction.
Mr. Prairie stated this would be at the top of the list of the
things for the attorney to consider.
Mr. Burns stated the document stated the seller is responsible
for capping the existing well, removal of any tanks -on the
property, removal of all contaminated soil, removal of all
fluorescent light bulbs and ballast, removal of all groundwater
contamination, and asbestos if any. The seller is to.obtain the
appropriate documentation as to the completion of these items.
Our attorney felt this covers it, but we did waive the asbestos
portion. It is possible that, in the future, someone could open
the ground and find more pollution after we had acquired the
property. We would then be responsible. He thought they were
eligible to apply for petrol funds in that instance. .
Mr. Casserly stated this was correct. As long as it is eligible
to be reimbursed by the petrol fund, it does not matter who is
the owner. A governmental agency may get a larger reimbursement
than the private section.
Mr. Meyer stated, if we find pollution at a later time, we are
still liable.
Mr. McFarland stated, if the petrol fund transfers, the liability
is only lot. He was told the petrol fund does not go along with
it. It is possible it will transfer after it has been
determined.
Mr. Burns stated, in either case, we are not trying to protect
ourselves from this type of event. We are saying the family
needs to clean up what is there and demonstrate this has been
done through a closure statement. We are not trying to claim
indemnification from future contamination. If the HRA wants
that, this will need to be negotiated.
Mr. Casserly stated, under the current law, the prior owners and
everyone who had contributed to the problem are all liable. If
the HRA purchases a site that has pollution on it and the HRA
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9. 1995 PAGE 22
does not worsen it, the HRA is not liable. The problem is that
you have a site you cannot do anything with. An HRA does not
take on the same liability as other purchasers would take on, but
you would have a site you could not use.
Mr. Casserly stated, regarding the petrol fund, if there is
contamination and it is cleaned up to the degree required in the
work plan, there is nothing more one can do. If you find
contamination subsequent to closure, that is no different than
any purchaser trying to develop a site.
Mr. McFarland stated, if you have access to the petrol fund, this
fund will make the cost manageable. If the fund will follow to
the new owner, it will protect to 90% of the costs.
Mr. Casserly stated the only issue becomes whether the
contamination is eligible. If it is, it would be reimbursed.
Mr. Burns stated the Gabrelcik's have done the clean up. The
clean up has been approved. The only issue is the approval of
the disposal of the soil removed from the site. The family .
expects to receive the letter in a few days. The family would
like to close on or before December 1.
Mr. Commers asked Mr. Burns. to ask the.attorney to tell us that, .
if something happens when ground is broken, we have the petrol
fund.
Mr. Burns stated he had discussed this with Liesch and
Associates, and he thought Mr. Davis had said we were protected
by the petrol fund as long as it was a petroleum contamination.
Mr. Commers stated, if the MPCA letter is contingent, it creates
other issues.
Mr. Burns stated he will not sign if anything other than a non-
contingent letter is received.
NOTION by Mr. Meyer, seconded by Mr. Prairie, to authorize the
Executive Director to enter into a purchase agreement for
$165,000 for the Frank's Used Car site and two adjacent vacant
lots, contingent upon receipt of a satisfactory closure letter
from the MPCA.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON CONNERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
15. J. R. AUTO SITE
Ms. Dacy stated the owner of JR's Auto on University Avenue
contacted her regarding the sale of this property. Mr. Schuur,
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 23
the owner, contacted her to determine if the HRA was interested
in evaluating the purchase of the property. Mr. Schuur was aware
that the HRA had looked at the property earlier as part of a
redevelopment plan. Ms. Dacy asked the HRA for permission to
further investigate the possible acquisition and to discuss other
items such as a Phase I audit.
Ms. Dacy stated there are four parcels available. The building
is in poor condition. The property may be eligible for tax
increment financing. Perhaps staff should investigate this if
the HRA would like to use this property in conjunction with the
Frank's Used Car site. Perhaps staff could check into this
further and come back at the next meetings.
Mr. Commers asked what issue would arise if, for example, the HRA
would take out a duplex or a residential home.
Ms. Dacy stated staff would need to update the housing plan. The
City Council recently elected to participate in the Livable
Communities Act, which means we are adopting principles that
support a balanced housing supply. We have to submit an action
plan by June 30,- 1996, and initiate and adopt a fair housing
ordinance.
Mr. Commers' asked, if a duplex was taken out, -would they have to
replace that housing.
Ms. Dacy stated there is no state law requirement, but-the
attorney is saying to adopt a plan as to how you do provide
affordable housing.
Mr. Hoeft stated the City of Columbia Heights is looking to
establish criteria for a certain percentage of affordable housing
so that there is not necessarily replacement housing as long as
you do not fall below a certain percentage of affordable housing.
Ms. Schnabel asked what was located next to the duplex going
east.
Ms. Dacy stated there is an apartment building, vacant land, and
then single family homes.
Mr. Commers asked staff to continue to talking with Mr. Schuur.
Mr. Commers stated the HRA has many thing going on requiring up
front cash. He would like to see a periodic cash flow statement
and asked Mr. Pribyl to provide that information.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOVEMBER 9, 1995 PAGE 24
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to adjourn the
meeting.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON CONNERS DECLARED
THE MOTION CARRIED AND THE NOVEMBER 90 19950 HOUSING AND
REDEVELOPMENT AUTHORITY MEETING ADJOURNED AT 10:05 P.M.
Respectfully submitted,
-&071111 dqX4 l
Lavonn Cooper
ld u'
Recording Secretary
• P
S I G N— I N S H E E T
HOUSING AND REDEVELOPMENT AUTHORITY MEETING, . November 9, 1995
Name
Address /Business
lam-
�ZZ ioL 0" /AL�f-z
beer , ocx4 f�►v (.v o,•v��r�
Hyde Park Housing Programs
Through 11/30/95
Single Family Programs /Services
Applications Received
Building Analysis
HRA Matching Deferred Loans
CEE Home Improvement Loans
CEE Home Energy Loans
Owner's Equity
Rental Property Programs /Services
Applications Received
Building Analysis
HRA Matching Deferred Loans
CEE Rental Rehab & Energy Loans
Owner's Equity
YTD YTD
No. Amount
15 N/A
14 N/A
Sub —Total 1 3 $9,331
12
11
Sub —Total (- 4 $36,000
Grand Totals 7 $45,331
1
--
TO: FRIDLEY H.R.A
FROM: CITY OF FRIDLEY
RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES
NOVEMBER 1995
NOVEMB,Fi....
ADMINISTRATIVE BILLING:
ADMINISTRATIVE PERSONAL SERVICES
ADMINISTRATIVE OVERHEAD
COMPUTER OVERHEAD
(For Micro & Mini computers)
TOTAL ADMINISTRATIVE BILLING:
OPERATING EXPENSES:
US WEST —TELEPHONE SERVICE
STAR TRIBUNE — AD REMODEL COUNSELOR
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
460-0000-430-4107 15.429.50
•••• • •cry.
TOTAL OPERATING EXPENSES:
262 -0000 -219 -1001
262 -0000- 219 -1100
262 -0000 -219 -1200
TOTAL BENEFITS EXPENSES
13.48 236 -0000- 336 -3000
540.00 236- 0000 - 336 -3000
553.48
0.00 236 -0000- 219 -1001
0.00 236 -0000- 219 -1100
0.00 236 -0000- 219 -1200
0.00
TOTAL EXPENDITURES — NOVEMBER 1995 jjjj&&
File : 1123DATAWRAITIF195BILL.wk1 Details
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MEWORANDUM
® Municipal Center
6431 University Avenue Northeast William C. Hunt
Fridley, Minnesota 55432 Assistant to the City Manager
CmrOF (612) 572 -3507
FMDLEY FAX: (612) 571 -1287
Memo to: Barbara Dacy, Director of Community Development
From: William C. Hunt, Assistant to the City Manager f
Subject: Resolution Authorizing Pay Increase for HRA Employees
Dater December 5, 1995
Since the HRA is a distinct entity it will be necessary for its board to
authorize salary increases for employees. I have adapted the resolution we
used for the Fridley City Council to apply to the needs of the HRA. In order
to provide salary increases effective January 1, 1996 it will be necessary for the
HRA to take action on this matter at its meeting of December 14, 1995. I
recommend that you present this matter for action at the above mentioned
meeting. If I can be of any further assistance let me know..
WCHIjb
RESOLUTION NO. HRA -1995
A RESOLUTION AUTHORIZING AN INCREASE IN COMPENSATION FOR
FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY EMPLOYEES FOR
THE 1996 CALENDAR YEAR
WHEREAS, it is the intention of the Fridley Housing and Redevelopment
Authority (HRA) to provide fair and equitable compensation to Employees
within budgetary constraints; and
WHEREAS, the Fridley HRA intends to comply with the Minnesota Local
Government Pay Equity Act; and
WHEREAS, Staff of the City of Fridley have reviewed the HRA's financial
position as well as economic indicators and compensation adjustments by
comparable employers; and
WHEREAS, an adjustment of employee salaries and benefits is warranted;
NOW, THEREFORE, BE IT RESOLVED by the Fridley Housing and
Redevelopment Authority that the following adjustments be authorized for
employees of the Fridley HRA, with the exception of employees who are
members of a bargaining unit, effective January 1, 1996:
I. A general increase of 2.0 percent in employee salaries.
2. Mileage reimbursement at the rate of $0.30 per mile.
PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF
FRIDLEY THIS DAY OF , 1995.
WILLIAM J. NEE - MAYOR
WILLIAM A. CHAMPA - CITY CLERK
j.10
r _
Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: December 8, 1995
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Establish Public Hearing for Sale of 5981 - 3rd
Street N.E. and 683 Glencoe Street N.E.
5981 - 3rd Street N.E.
At the November HRA meeting, two bids were received for this lot.
Both bidders submitted identical $4,000 offers and in response
the HRA rejected both bids and requested new bids. Bids were due
on December 1, 1995 and the same parties submitted offers which
are shown below.
Bidder
Offer
security
Tams, Inc. $5,100 $500 Cashier's Check
Whitney Homes $5,050 $500 Bank Money Order
Although the bids are less than the lot at 5973 - 3rd Street
N.E., staff feels that the bid is acceptable given the location,
surrounding market values, and the risk involved.
The HRA can't award the bid until
this time staff is requesting that
hearing for January 11, 1996.
683 Glencoe Street N.E.
a public hearing is held. At
the HRA establish a public
As you may recall, the HRA acquired this property in the Fall of
1994 and subsequently tore down the existing dwelling and a
garage. The lot is 50' x 110' in dimension which is too small
under City Code for building a new home. The parcel is adjacent
to several homes which are in fairly good condition and not
suitable for acquisition.
Over the course of the last several months, staff has been
evaluating options on what to do with this property since it is
i
Vacant Lots;
5981 - 3rd Street and 683 Glencoe Street
December 8, 1995
Page 2
nonbuildable. Because of its location and the configuration of
adjacent parcels, the only feasible option would be to sell the
entire lot to the neighbor at 681 Glencoe Street N.E. A map of
the site is attached for your reference.
Staff contacted a relative of the owner, Joe Paulzine, and
received a positive response about buying the property. Mr.
Paulzine is disabled and has limited financial resources to
purchase the property, however, his mother has agreed to give him
the funds to buy the lot. After several conversations with Berma
Paulzine, she has agreed to pay $3,000 for the property. This
price represents about $.54 per square foot, which is about
average for what the HRA has received in the past for its
nonbuildable residential lots.
Recommendation
Award of these properties cannot be made until a public hearing
has been conducted. At this time, staff recommends that the HRA
establish a public hearing for January 11, 1996.
GF/
M -95 -607
7A
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Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: December 8, 1995
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
,Grant Fernelius, Housing Coordinator
SUBJECT: Consider Approval of Sale and Development
Agreements and House Plans with Buyers of Vacant
Lots
In order to proceed with the development of the five lots sold
this Fall, the HRA must approve separate development agreements
with each buyer. In addition, the HRA has the ability to review
and approve the buyer's house plans before they start
construction. This provision insures the BRA that the homes meet
the minimum design guidelines of the program. A list of these
guidelines is attached.
Development Agreements
Each buyer is required to execute a Sale and Development
Agreement with the HRA. Copies of the agreements are attached.
The contracts are identical to what has been used in the past.
The major provisions of the agreement will be as follows:
1. Buyer will construct a single - family home with a minimum
sales price of $80,000 on or before June 30, 1996.
2. Buyer must submit house plans for HRA approval on or before
February 26, 1996.
3. Buyer shall pay $500 down at time of bid for the lot and pay
the balance owing at the time the house is completed. To
ensure repayment Buyer shall sign a loan note and mortgage
running in favor of the HRA. The loan will accrue interest
at 5% until it is paid in full.
4. Buyer shall provide a letter of credit in the amount of
$50,000 per house to be constructed. Buyer must provide
letter of credit on or before December 24, 1995.
Development Contract
December 8, 1995
Page 2
5. In the event of default the HRA has the ability to call the
loan due and payable; foreclose the mortgage; and /or draw
upon the letter of credit to complete the house.
House Plans
Of the three buyers, Oliver Tam and Diane Schommer have prepared
house plans which are ready for HRA review. Copies of their
house plans are attached. Below is a brief description of the
homes.
House #1: 533 Janesville Street N.E.
Buyer: Diane Schommer
House Price: $94,800 (Lot - $19,500)
House design: Modified 2 story design, 2 bedrooms, full
bath, and living room on upper level; entry
foyer, kitchen and eating area on main level;
unfinished lower level (suitable for family
room, future bedroom, den and utility room).
Total square footage = 1539. Two car
attached garage.
Exterior Vinyl siding with brick veneer on lower half
Materials: of front.
Contractor: Four Diamond Builders
Houses #2 -#4: 5924 - 2nd Street N.E.
5973 - 3rd Street N.E.
623 Lafayette Street NE
Buyer: Oliver Tam d /b /a Tams, Inc.
Proposed House Price: 5924 - 2nd Street NE (est. $95,000)
5973.- 3rd Street NE (est. $85,000)
623 Lafayette St. NE (est. 100,000)
Home Design: Split entry design, 2 bedrooms, 1 bath,
kitchen /dining room, and living room on upper
level; utility room and unfinished space on
lower level. Total square footage = 1,951.
Two car attached garage.
Exterior Vinyl siding with brick.
Materials:
Contractor: Tams, Inc.
Development Contract
December 8, 1995
Page 3
Whitney Homes anticipates that it will have house plans ready by
the January 1996 HRA meeting.
Recommendation
Staff recommends that the HRA approve Sale and Development
Agreements for Diane Schommer, Tams, Inc., and Whitney Homes. In
addition, staff also recommends that the HRA approve the house
plan designs as submitted by Diane Schommer. and Tams, Inc.
GF/
M -95 -608
DRAFT 12 -4 -95
SALE & DEVELOPMENT AGREEMENT
RELATING TO
533 Janesville Street
BY AND BETWEEN THE
FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY
DIANE SCHOMMER
f T
SALE & DEVELOPMENT
THIS AGREEMENT, made and entered into this day of
199_, by and between the Fridley Housing and
Redevelopment Authority, (hereinafter called the "HRA"), and
Diane Schoomer (hereinafter called the "Developer ");
WITNESSETH THAT, in the joint and mutual exercise of their
powers and in consideration of the mutual covenants contained
herein, the parties recite and agree as follows:
Section 1. Recitals.
1.01. The property. The HRA now owns the property
described in the attached Exhibit "A ", (the "Property "), located
in the City of Fridley, Anoka County, Minnesota.
1.02. Facilities and Project. The Developer, in accordance
with HRA approval, plans to construct or cause to be constructed
on the Property a single family home. The Developer shall
provide the HRA with a copy of its plans and specifications
showing details on the style, exterior architectural features,
materials, color selections, etc. of the home to be constructed,
which plans and specifications shall be submitted to the HRA for
review and approval prior to the issuance of any building permits
on the Property..
Section 2. Sale /Purchase of ProReerty.
2.01. 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 $19,500.00. Developer will
purchase the Property by Quit Claim Deed with a minimum down
payment of $ Soo. O0 . The balance of $ 19.000. 00 will be carried
on a purchase money mortgage (Exhibit B) at 5 %, which mortgage
and interest will be due and payable no later than -Tw1Q- 30, 199 1p,
at which time, if Developer is in full compliance with this
agreement, Developer will be provided with a Warranty Deed and
Satisfaction of Mortgage.
Section 3. Developer's Representations. The Developer hereby
represents, warrants and covenants to the HRA that as of the date
of this agreement the statements set forth in this section are
true and correct.
3.01. Litigation. There are no pending or, to the
knowledge of the Developer, threatened actions or proceedings
before any court or administrative agency which will materially
adversely affect the financial condition of the Developer or the
ability of the Developer to perform its obligations under this
Agreement.
3.02. Compliance. The Developer will comply with and duly
and promptly perform all of its obligations under this Agreement
and all related documents and instruments. Developer will also
comply with all State and local codes /ordinances.
Section 4. Developer's Undertakings.
4.01. Site Grading. Developer will be responsible for
establishing and adhering to site grading plans, which plans
shall be submitted to the HRA on or before Vebvva 4lv 11%. The
grading plans shall at a minimum specify house t pe, finish
grades and drainage pattern.
4.02 New Construction. Developer shall be solely
responsible for the construction of the single family home on the
Property by TVhe.30, 14tRo The minimum value of said home
shall be $80,000.00.
4.03. Floor Plan. Developer will be responsible for
submitting to the HRA, and obtaining pre - approval of the floor
plans -and front elevations of the home proposed to be constructed
on the Property. Said pre - approval must be obtained before the
HRA will issue any building permits to Developer.
4.04. Landscaping. Developer will provide a $500.00
yard /landscaping package included in the price of the home. Said
package will specify, at a minimum, tree sizes /type /number,
sodded yards, foundation plantings /beds, and any necessary
retaining walls.
4.05. Fees and Charges. The Developer will pay, when due,
all permit fees, connection charges, user charges or other
charges lawfully imposed by the City with respect to the
Property.
section 5. City's Undertakings.
5.01. Existing Improvements. The City will be responsible
for removing any existing structure, foundation and debris from
the Property and will assure that all water and sewer services
are stubbed to the boulevard at no cost to Developer.
Section 6. Security.
6.01. Letter of Credit. The Developer will provide the HRA
with a Letter of Credit in an amount equal to the anticipated
cost of the improvements to be made on the Property. The form of
the Letter of Credit shall be as set forth in Exhibit C (or
substantially similar as determined in the sole discretion of the
HRA). The Developer will be responsible for submitting the
Letter of Credit to the HRA for approval as to form and amount,
which approval must be obtained before any building permits will
issue. As improvements are made to the property, the HRA agrees
to negotiate with Developer certain incremental reductions in and
to said Letter of Credit based upon the value of the improvements
made.
Section 7. Default. The failure to meet any condition of this
Agreement shall be an event of default.
7.01. Remedies. If an event of default occurs and is not
cured within 30 days of receiving written notice of said default,
the HRA may take one or more of the following actions:
a. suspend performance under this Agreement;
b. terminate the Agreement, thereby rendering void
any promises or approvals contained in this
Agreement;
c. draw upon the Letter of Credit as referenced in
paragraph 6 herein;
d. foreclose upon the mortgage referenced herein as
provided by Minnesota law.
Section S. Notices. All notices hereunder shall be in writing
and either delivered personally or mailed by certified mail,
postage prepaid, addressed to the parties at the following
addresses:
PM
Fridley Housing and Redevelopment Authority
6431 University Ave. N.E.
Fridley, MN 55432
Attention: Grant Fernelius
Developer
Diane Schoomer
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.
91
FRIDLEY HOUSING AND
REDEVELOPMENT AUTHORITY
By:
William W. Burns
Its: Executive Director
By:
Lawrence R. Commers
Its: Chairperson
DEVELOPER
Diane Schoomer
STATE OF MINNESOTA )
) ss.
COUNTY OF ANOKA )
On this ' day of , 199_, 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
STATE OF MINNESOTA )
) ss .
COUNTY OF ANOKA )
On this day of , 199_, 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
within and for said County,
being by me duly sworn, did
in the foregoing instrument,
as her free act and deed.
f: \mimic \jdh \schoomer.hra
199_, before me, a Notary Public
appeared to me personally known, who,
say that she is Diane Schoomer named
and that this instrument was signed
Notary Public
lu
EXHIBIT "A"
Lots 15, 16 and 17, Block E, RIVERVIEW HEIGHTS, Anoka County,
Minnesota.
. . . . . . . . . . . .
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DRAFT 12 -4 -95
SALE & DEVELOPMENT AGREEMENT
RELATING TO
5720 Polk Street
BY AND BETWEEN THE
FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY
AND
WHITNEY HOMES, INC.
SALE & DEVELOPMENT AGREEMENT
THIS AGREEMENT, made and entered into this day of
, 199_, by and between the Fridley Housing and
Redevelopment Authority, (hereinafter called the "HRA"), and
Whitney Homes, Inc. (hereinafter called the "Developer ");
WITNESSETH THAT, in the joint and mutual exercise of their
powers and in consideration of the mutual covenants contained
herein, the parties recite and agree as follows:
Section 1. Recitals.
1.01. The property. The HRA now owns the property
described in the attached Exhibit "A ", (the "Property "), located
in the City of Fridley, Anoka County, Minnesota.
1.02. Facilities and Project. The Developer, in accordance
with HRA approval, plans to construct or cause to be constructed
on the Property a single family home. The Developer shall
provide the HRA with a copy of its plans and specifications
showing details on the style, exterior architectural features,
materials, color selections, etc. of the home to be constructed,.
which plans and specifications shall be submitted to the HRA for
review and approval prior to the issuance of any building permits
on the Property.
Section 2. Sale /Purchase of Property.
2.01. 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 $20,000.00. Developer will
purchase the Property by Quit Claim Deed with a minimum down
payment of $ 00.00 . The balance of $19.500.00 will be carried
on a purchase money mortgage (Exhibit B) at S which mortgage
and interest will be due and payable no later than Tvl-C 3Oi 1°19(0,
at which time, if Developer is in full compliance with this
agreement, Developer will be provided with a Warranty Deed and
Satisfaction of Mortgage.
Section 3. Developer's Representations. The Developer hereby
represents, warrants and covenants to the HRA that as of the date
of this agreement the statements set forth in this section are
true and correct.
3.01. No Disability. The Developer is a corporation,
authorized to do business in the State of Minnesota.
1*611I
3. 02. Litl
knowledge of the
before any court
adversely affect
of the Developer
obligations under
ation. There are no pending or, to the
Developer, threatened actions or proceedings
or administrative agency which will materially
the financial condition, business or operation
or the ability of the Developer to perform its
r this Agreement.
3.03. Compliance. The Developer will comply with and duly
and promptly perform all of its obligations under this Agreement
and all related documents and instruments. Developer will also
comply with all State and local codes /ordinances.
Section 4. Developer's Undertakings.
4.01. Site Grading. Developer will be responsible for
establishing and adhering to site grading plans, which plans
shall be submitted to the HRA on or before rebvua lgR(o . The
grading plans shall at a minimum specify house t )(Pe, finish
grades and drainage pattern.
4.02 New Construction. Developer shall be solely
responsible for the construction, marketing and sale of the
single family home on the Property by lbk -,C3o� MIR(p . The
minimum selling price of said home shall be $80,000.00.
4.03. Floor Plan. Developer will be responsible for
submitting to the HRA, and obtaining pre - approval. of the floor
plans and front elevations of the home proposed to be constructed
on the Property. Said pre- approval must be obtained before the
HRA will issue any building permits to Developer.
4.04. Landscaping. Developer will provide a $500.00
yard /landscaping package included in the sale price of the home.
Said package will specify, at a minimum, tree sizes /type /number,
sodded yards, foundation plantings /beds, and any necessary
retaining walls.
4.05. Fees and Charges. The Developer will pay, when due,
all permit fees, connection charges, user charges or other
charges lawfully imposed by the City with respect to the
Property.
Section S. City's Undertakings.
5.01. Existing Improvements. The City will be responsible
for removing any existing structure, foundation and debris from
the Property and will assure that all water and sewer services
are stubbed to the boulevard at no cost to Developer.
�i
section 6. security.
6.01. Letter of Credit. The Developer will provide the HRA
with a Letter of Credit in an amount equal to the anticipated
cost of the improvements to be made on the Property. The form of
the Letter of Credit shall be as set forth in Exhibit C (or
substantially similar as determined in the sole discretion of the
HRA). The Developer will be responsible for submitting the
Letter of Credit to the HRA for approval as to form and amount,
which approval must be obtained before any building permits will
issue. As improvements are made to the property, the HRA agrees
to negotiate with Developer certain incremental reductions in and
to said Letter of Credit based upon the value of the improvements
made.
Section 7. Default. The failure to meet any condition of this
Agreement shall be an event of default.
7.01. Remedies. If an event of default occurs and is not
cured within 30 days of receiving written notice of said default,
the HRA may take one or more of the following actions:
a. suspend performance under this Agreement;
b. terminate the Agreement, thereby rendering void
any promises or approvals contained in this
Agreement;
c. draw upon the Letter of Credit as referenced in
paragraph 6 herein;
d. foreclose upon the mortgage referenced herein as
provided by Minnesota law.
Section 8. Notices. All notices hereunder shall be in writing
and either delivered personally or mailed by certified mail,
postage prepaid, addressed to the parties at the following
addresses:
MW
Fridley Housing and Redevelopment Authority
6431 University Ave. N.E.
Fridley, MN 55432
Attention: Grant Fernelius
Developer
Whitney Homes, Inc.
311 Sunrise Lane
Champlin, MN 55316
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.
FRIDLEY HOUSING AND
REDEVELOPMENT AUTHORITY
By:
William W.'Burns
Its: Executive Director
By:
Lawrence R. Commers
Its: Chairperson
WHITNEY HOMES, INC.
By:
Its:
STATE OF MINNESOTA )
) ss.
COUNTY OF ANOKA )
On this day of , 199_, 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
STATE OF MINNESOTA )
) ss.
COUNTY OF ANOKA )
On this day of 199_, 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 , 199_, 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
of Minnesota, on behalf of the corporation, and that this
instrument was signed as his free act and deed.
f: \municUdh\polkdevk.hra
E90 M
Notary Public
State
EXHIBIT '•A"
Lot 3, Block 2, Sexter Addition, except the South 35 feet
thereof.
DRAFT 12 -4 -95
SALE & DEVELOPMENT AGREEMENT
RELATING TO
5924 - 2nd Street
5973 - 3rd Street
623 Lafayette Street
BY AND BETWEEN THE
FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY
D
TAM'S, INC.
U&
SALE & DEVELOPMENT AGREEMENT
THIS AGREEMENT, made and entered into this day of
, 199_, by and between the Fridley Housing and
Redevelopment Authority, (hereinafter called the "HRA"), and
Tam's, Inc. (hereinafter called the "Developer ");
WITNESSETH THAT, in the joint and mutual exercise of their
powers and in consideration of the mutual covenants contained
herein, the parties recite and agree as follows:
Section 1. Recitals.
1.01. The property. The HRA now owns the property
described in the attached Exhibit "A ", (the "Property "), located
in the City of Fridley, Anoka County, Minnesota.
1.02. Facilities and Project. The Developer, in accordance
with HRA approval, plans to construct or cause to be constructed
on the Property single family homes. The Developer shall provide
the HRA with a copy of its plans and specifications showing
details on the style, exterior architectural features, materials,
color selections, etc. of each home to be.constructed, which
plans and specifications shall be submitted to-the HRA for review
and approval prior to the issuance of any building permits on the
Property.
Section 2. Sale /Purchase of Property.
2.01. 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 $36,500.00. Developer will
purchase the Property by Quit Claim Deed with a minimum down
payment of $ 4500. 00 . The balance of $35,000. 00 will be carried
on a purchase money mortgage (Exhibit B) at S %,-which mortgage
and interest will be due and payable no later than Tuvw- 30, Ick"I(p,
at which time, if Developer is in full compliance with this
agreement, Developer will be provided with Warranty Deeds and
Partial Releases /Satisfaction of Mortgage.
Section 3. Developer's Representations. The Developer hereby
represents, warrants and covenants to the HRA that as of the date
of this agreement the statements set forth in this section are
true and correct.
3.01. No Disability. The Developer is a corporation,
authorized to do business in the State of Minnesota.
ja
3.02. Litj
knowledge of the
before any court
adversely affect
of the Developer
obligations under
ration. There are no pending or, to the
Developer, threatened actions or proceedings
or administrative agency which will materially
the financial condition, business or operation
or the ability of the Developer to perform its
r this Agreement.
3.03. Compliance. The Developer will comply with and duly
and promptly perform all of its obligations under this Agreement
and all related documents and instruments. Developer will also
comply with all State and local codes /ordinances.
Section 4. Develover's Undertakinas.
4.01. Site Grading. Developer will be responsible for
establishing and adhering to site grading plans, which plans
shall be submitted to the HRA on or before Qbrg4 ?l0 LO . The
grading plans shall at a minimum specify house type, finish
grades and drainage pattern.
4.02 New Construction. Developer shall be solely
responsible for the construction, marketing and sale of the
single family homes on the Property by ?vKc 30. 101%o . The
minimum selling price of each home shall be $80;000.00.
4.03. Floor Plan. Developer will be responsible for
submitting to the HRA, and obtaining pre - approval of the floor
plans and front elevations of the homes proposed to be
constructed on the Property. Said pre - approval must be obtained
before the HRA will issue any building permits to Developer.
4.04. Landscaping. Developer will provide a $500.00
yard /landscaping package included in the sale price of each home.
Said package will specify, at a minimum, tree sizes /type /number,
sodded yards, foundation plantings /beds, and any necessary
retaining walls.
4.05. Fees and Charges. The Developer will pay, when due,
all permit fees, connection charges, user charges or other
charges lawfully imposed by the City with respect to the
Property.
Section S. City's Undertakings.
5.01. Existing Improvements. The City will be responsible
for removing any existing structure, foundation and debris from
the Property and will assure that all water and sewer services
are stubbed to the boulevard at no cost to Developer.
• lA
Section 6. security.
6.01. Letter of Credit. The Developer will provide the HRA
with a Letter of Credit in an amount equal to the anticipated
cost of the improvements to be made on the Property. The form of
the Letter of Credit shall be as set forth in Exhibit C (or
substantially similar as determined in the sole discretion of the
HRA). The Developer will be responsible for submitting the
Letter of Credit to the HRA for approval as to form and amount,
which approval must be obtained before any building permits will
issue. As improvements are made to the property, the HRA agrees
to negotiate with Developer certain incremental reductions in and
to said Letter of Credit based upon the value of the improvements
made.
section 7. Default. The failure to meet any condition of this
Agreement shall be an event of default.
7.01. Remedies. If an event of default occurs and is not
cured within 30 days of receiving written notice of said default,
the HRA may take one or more of the following actions:
a. suspend performance under this Agreement;
b. terminate the Agreement, thereby rendering void
any promises or approvals contained in this
Agreement;
c. draw upon the Letter of Credit as referenced in
paragraph 6 herein;
d. foreclose upon the mortgage referenced herein as
provided by Minnesota law.
section 8. Notices. All notices hereunder shall be in writing
and either delivered personally or mailed by certified mail,
postage prepaid, addressed to the parties at the following
addresses:
HRA
Fridley Housing and Redevelopment Authority
6431 University Ave. N.E.
Fridley, MN 55432
Attention: Grant Fernelius
Developer
Tam's, Inc.
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.
FRIDLEY HOUSING AND
REDEVELOPMENT AUTHORITY
By:
William W. Burns
Its: Executive Director
By:
Lawrence R. Commers
Its: Chairperson
TAM'S, INC.
By:
Its:
STATE OF MINNESOTA )
) ss.
COUNTY OF ANOKA )
On this day of , 199_, 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
am
STATE OF MINNESOTA )
ss.
COUNTY OF ANOKA )
On this day of , 199_, 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 ' 199, 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 Tam's, 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: \mimic \1dh \tamdevk.hra
M��
Notary Public
EXHIBIT "A"
gfto 9
Lots., Block A", Hyde Park, Anoka County, Minnesota.
Lots 27 and 28, Block 12, Hyde Park, Anoka County, Minnesota.
Lot 26, Block C, RIVERVIEW HEIGHTS, Anoka County, Minnesota, and
that part of all of the vacated Broad Avenue
N.E., lying southerly of the westerly extension
of the northerly line and northerly of the
westerly extension of the southerly line of said
Lot 26.
Reserving and subject to easements for bikeway
and walkway purposes in favor of the City of
Fridley, over the westerly 15 feet and that part
of the northerly 10 feet lying within vacated
Broad Avenue thereof, and northwesterly of a
line drawn from points distant 12.0 feet
southerly and northeasterly of the intersection
point of the interior easements lines.
Also reserving and subject to an easement for
access purposes in favor of the property
adjacent westerly, lying southerly of a line
drawn from the most southerly corner of Lot 26,
Block C to a point distant 11.30 feet northerly
of the intersection of the westerly extension of
the southerly line of said Lot 26 with the
westerly line of vacated Broad Avenue.
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Casserly Molzahn & Associates, Inc.
Suite 1100 Southpoint Office Center • 1650 West 82nd Street • Minneapolis, Minnesota 55431 -1447
Office (612) 885 -1298 • Fax (612) 885 -1299
M E M O R A N D U M
TO: City of Fridley
Attn: William Burns, City Manager
arbara Dacy, Community Development Director
FROM: James R. Casserly
Mary E. Molzahn
RE: Contract for Private Redevelopment By and Between the
Fridley HRA and Industrial Equities, LLP
DATE: December 6, 1995
Enclosed is the December 4, 1995 draft of the Contract for
Private Redevelopment between the above parties. In
consideration for the Redeveloper's construction of an 88,000
square foot office /manufacturing /warehouse facility, the
Authority will assist the Redeveloper with utility relocation and
site preparation costs in an amount not to exceed $280,000. This
represents less than 10 percent of the total project cost.
The Contract provides in Article 3 that $140,000 will be paid as
a grant and $140,000 will be provided as a loan.
Schedule D attached to the Contract is a copy of the Note.
Interest will commence August 1, 1996 at five percent per annum.
The Note will be paid in semi - annual installments of $10,994.93
commencing August 1, 1998 and continuing until August 1, 2006.
Interest is calculated at a rate of five percent per annum.
The amount of the assistance and the allocation between a loan
and a grant are identical to the Redevelopment Contract the
Authority just recently approved for AGRO -K. As with the AGRO -K
Contract, the Note will be secured by a second mortgage recorded
against the property and will be personally guaranteed by John
Allen, the principal owner of the Redeveloper, Industrial
Equities, LLP.
There is one change from the AGRO -K Contract. With AGRO -K, the
Authority provided the loan and grant prior to the construction
of the new facility (this was principally the result of S.B.A.
financing). In this contract, loan and grant will not be
provided until the building is completed, a certificate of
occupancy has been issued and the Authority has provided its
�J
Certificate of Completion.
The Contract is very similar to other contracts the Authority has
approved over the last ten years. However, there is one new
provision which is a result of recent state law changes. That is
found in Section 2.2(i) on page 7 of the Contract. The
Redeveloper represents in that section that a certain number of
new jobs will be created at certain wage levels. We will be
discussing the number of jobs and the wage levels further with
the Redeveloper and will insert the appropriate numbers.
The Contract helps the Authority achieve its goals and provides
as much security as seems reasonable for the Authority's loan.
We recommend its approval. If there are any questions or
problems, please give a call.
JRC /MEM /kh
CC: John Allen
Encl
MO
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE
CITY OF FRIDLEY
COUNTY OF ANOKA
STATE OF MINNESOTA
RESOLUTION NO.
A RESOLUTION AUTHORIZING EXECUTION AND DELIVERY OF A CONTRACT
FOR PRIVATE REDEVELOPMENT BY AND BETWEEN THE HOUSING AND
REDEVELOPMENT AUTHORITY IN AND FOR THE CITY FRIDLEY AND INDUSTRIAL
EQUITIES, LLP.
BE IT RESOLVED by the Board of Commissioners (the
"Commissioners ") of the Housing and Redevelopment Authority in and
for the City of Fridley, Minnesota (the "Authority ") as follows:
Section 1. Rec =tals.
1.01. It has been proposed that the Authority enter into a
Contract For Private Redevelopment (the "Contract ") with Industrial
Equities, LLP (the "Redeveloper ").
Section 2. Findinas.
2.01. The Authority hereby finds that it has approved and
adopted a development program known as the Modified Redevelopment
Plan for its Redevelopment Project No. 1 (the "Redevelopment
Program ")pursuant to Minnesota Statutes, Section 469.001 et sect.
2.02. The Authority hereby finds that the Contract
promotes the objectives as outlined in its Redevelopment Program.
Section 3. Authorization for Execution and Delivery.
3.01. The Chairman and the Executive Director of the
Authority are hereby authorized to execute and deliver the Contract
when the following condition is met:
Substantial conformanc.e.of a Contract to the Contract
presented to the Authority as of this date.
Adopted by the Board of Commissioners of the Authority this
day of , 199_.
ATTEST:
Executive Director
Chairman
•
INDUSTRIAL EQUITIES L.L.P.
Development and Investments
TEL 612 591 0892 1660 South Highway 100, Suite 536W, Minneapolis, Minnesota 55416 FAX 612 591 1383
October 19, 1995
Ms. Barb Dacy
Community Development Director
City of Fridley
6431 University Avenue NE
Fridley, MN 55432
1017-M:7A
As you know, Industrial Equities has a preliminary interest.in developing the 6.8 acre Northco
Business Center. site that.is located at 73rd. and University:. with a Speculative multi tenant `88,000
square .foot business center. Because site has.significant.soil correction and utility relocation
issues our current and future interests must be contingent upon establishing a reasonable tax
increment and financing distdct .that is consistent with . the plans that have been discussed
between Northco, James Casserly and the City. Without soil correction and utility relocation
assistance this project, like others considered before it, cannot proceed, and the future
development is quite unlikely.
Based on our discussions and your previous discussions with Northco, it appears that the HRA
and the City Council will favorably consider establishing a tax increment finance district for this
site. Accordingly, I have developed preliminary project designs and made the required
..applications_to.the-City and .Rice Street Watershed;Distdot.toallow for the sites preparation and
correction. As I understand it, the District cannot be formally established prior to December
12, 1995. However, assuming the City would support this proposal, Industrial Equities would
like to do preliminary site preparation prior to that date so as to allow for construction through
the winter. This site preparation would include.anly tree removal and general site grading that
would allow for specific soil correction and preparation for the importing of the required select
material to correct and raise the elevation of the site after the approval is granted.
Unfortunately, if this early access is not possible, site grading must be delayed until late April
of 1996, and construction completion will be delayed by over five months.
Barb, if T.I.F. is not going to be available on this project we clearly do not want to get out in
front. of the headlights and invest any more time or money. However, if the City supports this
Project, we would like to take the allowable steps which would bring this project on line in the
Spring of 1996.
9C
Ms. Barb Dacy
October 19, 1995
Page 2
Industrial Equities is enthusiastic about the possibility of developing this project in Fridley
because businesses like doing business in Fridley. The City works for both the employees and
the employers. You have virtually no vacancy but you have no expansion space to expand your
existing companies much less attract desirable new employers. Industrial Equities believes a
high quality energy efficient business center could fill this void for both Fridley and businesses
in the City. I look forward to discussing in greater detail with you the HRA and City Council's
response to this request.
If.you ;'e any queens; dl da not hesitaWAG 2dvise.
Yours very truly,
John N. Allen
JNA/gw
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CIVY. OF FRIDLEY
TEL: 61,2 -571, -1287
Oct--
23 , 95 16 =1-3�-No . — .
Principal
Business or Product of the
Company?
Is the Proposed Project a Now Facility' or Rehabilitation and /or
Expansion of Existing Facility?
VW , it L
Industrial/Commercial/Residential:
What is the Present Employment of Your Firm:
What is Your Estimate of Employment One Year After Completion of
Project:
What is Your Estimate of Employment Five Years After Completion of
Project:
Total Estimated Project Cost:
Total Estimated Construction Costs: 0A vev
Potential Other Use(s) of Proposed Development:
Will this Development Attract Other Related Industries:
Yes No
How? ' IZ.p Vlt as
What Types? � ova
What is. the Current Zoning Status of the Project Bite? T' —k
In Rezoning, will Zoning Variances or Conditional Use Permits be
Required in Connection with the Project?
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CITY OF FRIDLEY TEL: 612 -571 -1287 —0c—" = 3 .006 7Q
Is the Property Properly Subdivided for the proposed tlse?
4; 2
Has Site Approval been Obtained for this Project?
If So, When?
By Planning Commission?
By City Council?
Have You Applied for Conventional Financing for the Project?
Yes No
If Yes, Provide Details on Separate Sheet, ON. Information to
Attach"
If No, Why Not?
Please include:
State Public Purpose
T--- Description of Project
Schematic Drawing of Project
-j Breakdown of Project Costs
Amount of Subsidy Request
Construction Schedule
Legal Description - (Include PIN's)
Other Pertinent Information
Deposit
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Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: December 8, 1995
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Southwest Quadrant
CITY COUNCIL RECOMMENDATION
The City Council discussed the Southwest Quadrant at its workshop
session on November 20, 1995. In preparation for that meeting,
the two Councilmembers who wanted to retain the condominiums were
asked to identify their concerns if the senior condominiums were
eliminated from the development plan.
Abandoning the senior condominium element seemed to equate to not
providing affordable owner - occupied housing for seniors in the
community. Therefore, Rottlund was asked to develop another
housing style which would appeal to seniors in an affordable
price range ($90,000 - $120,000).
Rottlund developed what ended up being three additional site
plans. Todd Stutz from Rottlund Homes attended the meeting, and
a lengthy discussion occurred. The third alternative (which has
become known as Option #6) was agreed -upon by the City Council
and is recommended to the HRA. A copy of the proposed site plan
is included in your packets.
The plan can best be described in two parts. The first part is
the area east of 3rd Street and immediately adjacent to
University Avenue; this area would contain 62 units of a three -
story product. Four eight -unit buildings-are proposed in the
southeast part of the site, and then 30 units of three -story
townhomes are proposed around the proposed plaza area in the
northeast part of the site.
The second part, or the west side of 3rd Street, would be three
groupings of townhomes:
A) No more than 20 homes selling between $90,000 - $110,000,
B) 20 homes selling between $110,000 - $120,000, and
C) 20 homes selling between $120,000 - $130,000.
1n
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Southwest Quadrant
December 8, 1995
Page 2
It is the City Council's intent that the 20 homes in the $90,000
- $110,000 price range would be one -story townhomes, and that the
homes in the other two price categories would be a mixture of
one- and two -story homes depending on what the market dictates.
Stutz was amenable to the proposed plan, but wanted to meet with
myself and Jim Casserly to start identifying the key aspects of
the development contract. Of particular concern to Stutz is the
prevailing wage requirement in the development contract.
Casserly and I will be meeting with Stutz on Friday, December 8,
1995 to outline the financial issues to be addressed in the
development contract.
In addition, Casserly's office is working on a revised cash flow
analysis based on a revised tax increment projection,.land sale
negotiation, and revised phasing plan beginning in 1996. This
will be distributed at the HRA meeting.
OTHER RELATED ISSUES
In the meantime, staff has initiated the process with Anoka
County to request them to pay for 1/4 of the Mississippi Street
improvement cost. The owners of Holly Center have agreed to pay
for up to 1/4 of the intersection cost via a special assessment
procedure. The developer's share will be negotiated through the
land sale price. Therefore, the cost to the HRA instead of
$160,000 as originally anticipated would be reduced by 3/4.
Anoka County hopes to respond to our request by the.second
meeting in January. Before final plans and drawings are
prepared, however, Stutz wants to begin resolving some of the
details on the development contract. After our meeting on
Friday, December 8, 1995, staff will have an updated report for
the HRA at Thursday's meeting.
The Remedial Investigation plan for the former Fast Lube site has
been completed and submitted to MPCA. The plan recommends two
more quarterly sampling events be conducted at the four
monitoring well sites. If contaminant levels continue to be at
low levels, the consultant may request the MPCA issue a closure
letter. The plan found no contamination risk to other wells in
the City. Typical remediation procedures such as soil venting
and groundwater pumping may not be necessary, according to the
consultant.
RECOMMENDATION
Staff would like the HRA to review the revised plan, the revised
cash flow, and provide direction to staff and the developer if
ino
Southwest Quadrant
December 8, 1995
Page 3
the plan should be pursued. As of this time, there is a
unanimous conclusion from the City Council that this plan is
acceptable to them and addresses their concerns.
BD /dw
M -95 -609
J
Community Development Department
HOUSING AND REDEVELOPMENT AUTmRITy
City of Fridley
DATE: December 8, 1995
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Review Development Options for Sites on University
Avenue
On Thursday evening, options will be presented to the HRA
reviewing potential development scenarios on the Frank's Used Car
site, the JR's Automotive site on the east side of University,
and Block 22, Hyde Park. We are developing these options for HRA
review and ultimately City Council review in order to determine a
preferred land use. We will also be working with Jim Casserly's
office to make some general projections for potential expenses
and revenues for each of these options. In addition, a
neighborhood review process will also need to occur early on
prior to initiation of RFP's.
BD /dw
M -95 -610
11 I
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Community Development Department
D HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: December 8, 1995
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Draft 1996 Budget
The draft 1996 budget is now being prepared in anticipation of
HRA review at its January meeting. We are now completing
research on the costs associated with redeveloping the Frank's
Used Cars site and other sites; those will then be incorporated
into the 1996 budget.
BD /dw
M -95 -612
12
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Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: December 8, 1995
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Lake Pointe Update
The Contract for Exclusive Negotiations with MEPC has been
modified according to the HRA direction at the November meeting.
Section 2.2(D) was amended to accommodate the HRA's concern.
Casserly worked in close contact with the City Manager and the
Chairperson to finalize the language.
An important fact to remember is that the contract requires the
redeveloper to present the master plan of the site to the City
and HRA for review and approval. Therefore, the HRA will have
direct input on the types of uses that should occur in the
commercial tract.
A copy of the final contract is attached.
BD /dw
M -95 -611
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DRAFT: December 1, 1995
CONTRACT FOR EXCLUSIVE NEGOTIATIONS
THIS AGREEMENT, effective as of this 1st day of December,
1995 is between the Housing and Redevelopment Authority in and
for the City of Fridley, having its principal offices at 6431
University Avenue N.E., Fridley, Minnesota, 55432, and MEPC
American Properties, Inc., a Delaware corporation with its
Minnesota office at 1550 Utica Avenue South, Suite 120,
Minneapolis, Minnesota 55416.
WHEREAS, the Redeveloper is proposing to develop the area
identified on the map attached as Schedule A and is requesting
that the Authority negotiate exclusively with the Redeveloper
while the area is being studied, designed and marketed.
WHEREAS, the Authority is willing to negotiate exclusively
with the Redeveloper provided certain conditions described below
are met.
NOW, THEREFORE, in consideration of the premises and the
mutual obligations of the parties hereto, each of them does
hereby covenant and agree-with tht other as follows:
Section 1.1. Definitions. In this Agreement unless a
different meaning clearly appears from the context:
"Agreement" means this Agreement, as the same may be from
time to time modified, amended, or supplemented.
"Authority" means the Housing and Redevelopment Authority in
and for the City of Fridley, Minnesota.
"City" means the City of Fridley, Minnesota.
"Council" means the Council of the City.
"Marketing Plan" means the program to market the
Redevelopment Project. The Marketing Plan is further described
on Schedule B attached to this Agreement.
"Master Plan" means the plan detailing the overall
development of the Redevelopment Project as a corporate office
park with a commercial component on the Commercial Tract. The
Master Plan shall be prepared by the Redeveloper and approved by
the Authority and the City.
"Minimum Improvements" means as follows:
A. For the Office Tract it is the construction of Class A
office buildings of not less than 50,000 square feet
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and containing not less than three stories for each
building. The office buildings may contain some
ancillary space for service retail that is needed to
promote and develop a Class A corporate office park.
B. For the Commercial Tract it includes any use described
for the Office Tract and further includes commercial
uses such as restaurants, banks, day care centers,
hotels, medical clinic, convention center and service
retail but not general retail.
"Party" means a party to this Agreement.
"Purchase Price" means the amount to be paid by the
Redeveloper for the Redevelopment Property. The Purchase Price
for the Office Tract shall be an amount equal to fifty percent
(500) of the market value established by an independent appraiser
selected by mutual agreement of the Authority and the
Redeveloper, provided that the appraiser shall have determined
the value within nine (9) months of the date of closing. Only
the first building in the Office Tract will be eligible, provided
that the building does not exceed 80,000 square feet, for the
Purchase Price described above. Since sub8equent buildings in
the Office Tract will have structured parking, the Purchase'Price
shall be ten dollars ($10.00) for each parcel.
The Purchase Price for parcels in the Commercial Tract.shall be
an amount equal to seventy -five percent (75%) of the market value
established by an independent appraiser selected by mutual
agreement of the Authority and the Redeveloper, provided that the
appraiser shall have determined the value within nine (9) months
of the date of closing.
"Purchase Price Payments" means payments received by the
Authority for the Purchase Price.
"Redeveloper" means MEPC American Properties, Inc., a
corporation organized and existing under the laws of the State of
Delaware.
"Redevelopment Contract" means the Contract for Private
Redevelopment described in Section 4 of this Agreement.
"Redevelopment Project" means the Redevelopment Property and
the Minimum Improvements.
"Redevelopment Property" means the real property described
in Schedule A of this Agreement. That portion to the west
compromising approximately 24.56 acres shall be referred to as
the Office Tract. That portion to the East comprising
approximately 8.21 acres shall be referred to as the Commercial
Tract.
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A
"State" means the State of Minnesota.
"Tax Increment" means only that portion of the real estate
taxes paid solely with respect to the Redevelopment Property
(which is part of the property in the Tax Increment District) and
which is remitted to the City as tax increment pursuant to the
Tax Increment Act.
"Tax Increment Act" means Minnesota Statutes, Sections
469.174 - 469.179.
"Tax Increment District" means Tax Increment Financing
District No. 6 created by the Council in connection with the
Redevelopment Program.
"Tax Increment Plan" means the tax increment financing plan
adopted by the Authority in connection with the creation of the
Tax Increment District.
"Unavoidable Delays" means delays which are the direct
result of strikes, other labor troubles, unusually severe or
prolonged bad weather, Acts of God, fire or other casualty to the
Minimum Improvements, litigation commenced by third parties
which, by injunction or other similar judicial action, directly
results in delays, or acts of any federal, state or local
governmental unit which directly result in dela3is.
Section. 2.1. Representations by the Authority. The
Authority represents as follows:
(A) The Authority is a public body duly organized and
existing under the laws of the State. Under the provisions of
the Act, the Authority has the power to enter into this Agreement
and carry out its obligations hereunder.
(B) The Authority is the fee owner of the Redevelopment
Property
(C) The Authority shall use all Purchase Price Payments to
reimburse the Redeveloper for the costs of structured parking in
the Office Tract.
Section 2.2. Representations by the Redeveloper. The
Redeveloper represents as follows:
(A) The Redeveloper is a Delaware corporation, organized
and existing in good standing under the laws of. Minnesota, is
authorized to transact business in the State, has duly authorized
the execution of this Agreement and the performance of its
obligations hereunder, and neither the execution and delivery of
this Agreement, the consummation of the transactions contemplated
hereby, nor the fulfillment of or compliance with the terms and
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conditions of this Agreement will constitute a breach of any
obligations of the Redeveloper under the terms and conditions of
any indebtedness, agreement or instrument of whatever nature to
which Redeveloper is now a party or by which it is bound, which
breach will materially adversely affect the ability of
Redeveloper to perform its obligations under this Agreement.
(B) The Redeveloper's mission for this Redevelopment
Property is to develop multi - tenant, multi -story office buildings
with support services commensurate with successful office parks.
(C) The Redeveloper will pursue all prospective users
including those interested in build -to -suit or land purchases
which fulfill the economic and aesthetic vision described in B
above and conform to the Master Plan. -
(D) While the Office Tract has priority for development,
the Authority will not unreasonably withhold its approval of
those projects in the Commercial Tract that are identified in teh
Master Plan and are essential in attracting u sers to the Office
Tract.
(E) The first office building may have temporary surface
parking but will be designed to accommodate structured parking of
two or-more levels. With the development of a second building,
the two buildings will be served by a combination of structured
and surface parking. Subsequent buildings will be constructed
with structured parking but may also have surface parking.
Section 3.1. Redeveloper Responsibilities. The Redeveloper
shall be responsible for all costs associated with the marketing
and development of the Redevelopment Project. The Redeveloper
shall implement the Marketing Plan generally as follows:
A. Establish office market data on this location and
determine the corporate users and amenities for space
in the Redevelopment Project.
B. Review any previous plans and design a Master Plan as
necessary to maximize the site and meet the
requirements of-the corporate users (in building size,
floor plate, quality, timing and market rate) for this
location. The Master Plan will be presented to the
City and Authority for their review and approval, and
the Redeveloper shall reasonably adjust the Master Plan
consistent with market needs as requested by the City
and Authority.
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
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these marketing events and materials are set forth in
Exhibit B.
D. The official announcement to the public of the
Redevelopment Property would be achieved by the
activities shown on Exhibit B including:
Broker special event on site
News releases
Corporate user presentations
Mailings to prospects
E. Investigate the adequacy of soils, utilities, and
street systems for the Master Plan.
F. Review and comment upon the adequacy of the existing
indirect source permit and environmental assessment
worksheet for the Master Plan implementation.
G. Review and comment upon the adequacy of existing
ordinances to facilitate development of the Master
Plan.
H. Investigate the status of title, and review existing
environmental reports furnished by the Authority
regarding any hazardous substances on the Redevelopment
Property.
I. Every 90 days provide a written activities report to
the Authority which describes the Redeveloper's
activities pursuant to this Agreement.
J. Cooperate with the City and Authority in reasonable and
appropriate ways.
Section 3.2. Authoritv Responsibilities. The Authority
shall be responsible for the following:
A. Indirect source permit and associated traffic analyses
(amended and /or reactivated original) for the
Redevelopment Property.
B. Prepare any necessary environmental assessment
worksheet, environmental impact statement or
modification thereof.
C. Conduct any additional required environmental
investigation.
D. Provide any necessary infrastructure changes, including
street and intersection improvements, due to the Master
Plan.
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E. Refer all third party inquiries regarding use,
availability, and development potential of the
Redevelopment Property to the Redeveloper.
F. Recommend changes to City ordinances to facilitate
development consistent with the Master Plan.
G. Cooperate with the Redeveloper in reasonable and
appropriate ways.
H. Conduct a comprehensive review of Redeveloper's
performance under this Agreement on at least September
1, 1996 and March 1, 1997.
Section 4.1. Contract for Private Redevelopment. Provided
that this Agreement is not in default and any time after
Authority approval of the Redeveloper's Master Plan, at either
Party's request, the Parties shall negotiate in good faith and
execute the Redevelopment Contract within forty -five (45) days
after the request. The Redevelopment Contract shall address the
issues involving the development of the Redevelopment Property
including the following:
A. The Purchase Price
B. Timing of the Minimum Improvements
C. Composition of the-Minimum Improvements
D. Timing of any site improvements or public improvements
E. Redeveloper guarantees
F. Duration
G. Application of Purchase Price Payments to structured
parking
Section 5.1. Termination. This Agreement shall terminate
as follows:
A. If by August 1, 1996 the Redeveloper has not completed
the program elements as outlined in the Marketing Plan
or this Agreement.
B. If the Redeveloper, has not commenced construction of
an office building in the Office Tract by August 1,
1997, said time to be extended by Unavoidable Delays.
The August 1, 1997 date shall be extended to November
1, 1997 if the Redeveloper has provided a letter of
intent, lease or commitment to lease for an office
building.
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C. If the Parties have not executed a Redevelopment
Contract by August 1, 1997.
Section 5.2. Effect. The Parties agree that upon
termination of this Agreement they shall have no further
obligation to each other except as provided for in this Agreement
and the Parties further agree to execute any document reasonably
necessary to give effect to a termination.
Section 6.1. Additional Provisions:
A. The Redeveloper shall not assign this Agreement.
B. The Redeveloper shall hold the Authority and the City,
their agents, officers and employees harmless from any
of the Redeveloper's acts or the acts of those
operating under its direction with regard to marketing,
development, construction, sale and all other
activities contemplated by this Agreement.
C. The Parties are not partners in the development of the
Minimum Improvements or in any activities contemplated
by the Agreement.
D. If requested.by the Authority,. the Redeveloper shall
Provide evidence of a general liability insurance
Policy in an amount of one million ($1,000,000) per
person and two million ($2,000,000) per occurrence
naming the City and the Authority as insured parties
and which requires a 30 -day written notice of
cancellation to the City and the Authority.
IN WITNESS WHEREOF, the Authority has caused this Agreement
to be duly executed in its name and behalf and the Redeveloper
has caused this Agreement to be duly executed on or as of the
date first above written.
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Dated:
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
OF FRIDLEY, MINNESOTA
By
Its Chairman
And by
Its Executive-Director
STATE OF MINNESOTA )
ss
COUNTY OF ANOKA )
On this day of 199 before me, a
notary public within and for Anoka County, personally appeared
and.* to me
personally -known who by me duly sworn; did say that they are the
Chairman and Executive Director of the Housing and Redevelopment
Authority in and for the City of Fridley, Minnesota, a political
subdivision of the State of Minnesota, and acknowledged the
foregoing instrument on behalf of said Authority.
Notary Public
Authority Signature Page — Contract for Exclusive Negotiations
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Dated:
MEPC American Properties, Inc.
By
STATE OF MINNESOTA )
)ss
COUNTY OF )
Its
On this day of , 199 before me, a
notary public within and for County, personally appeared
the of MEPC
Properties, Inc., a corporation, and acknowledged
the foregoing instrument on behalf of said corporation.
Notary Public
Redeveloper Signature Page — Redevelopment Contract
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SCHEDULE B
FRIDLEY MARKETING PROGRAM
Press Release:
Signage:
Flyer Created and
Mailed Users & Brokers:
Focus Group for
Office Users:
Master Plan Review:
Up Press Release:
Direct Mail Piece to
Brokers:
Broker Event on Site:
Quarterly Updates:
Upon execution of the Agreement
Revise signage showing
Redeveloper as contact
January 1996
January 1996
January 1996
Planning review would commence
after information is provided by
the first focus group.
Redeveloper will then present
the preliminary Master Plan to
the City and Authority for
Authority response and review by
March 15, 1996, the Authority
shall review and or approve or
modify the preliminary Master
Plan by April 15, 1996.
Upon review and approval of
preliminary Master Plan
May 1996
June 1996
Redeveloper will provide updates
to the Brokerage community on a
quarterly basis. This
development project will be in
the annual Redeveloper vacancy
update
Redeveloper would meet with the
Authority quarterly to provide
project updates
Continuing marketing efforts would be evaluated and put in place
as needed after July 1, 1996.
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