HRA 06/12/1997 - 6277HOUSING & REDEVELOPMENT AUTHORITY MEETING
THURSDAY, JUNE 12, 1997
,?<O P.M.
0.100
WILLIAM BURNS
EXECUTIVE DIRECTOR OF HRA
CITY OF FRIDLEY
HOUSING & REDEVELOPMENT AUTHORITY MEETING
THURSDAY, JUNE 12, 1997 * * * 8:00 P.M. * * *
AGENDA
LOCATION: Council Chambers (upper level), Fridley Municipal Center
CALL TO ORDER
ROLL CALL
APPROVAL OF MINUTES: May 8, 1997
CONSENT AGENDA:
Consider Approval of a Resolution Adopting a Policy 1 - 1 G
Implementing Prevailing Wage Requirements
Election of Officers 2
Revenue and Expenses 3-313
PRESENTATION
Presentation by Pam Bloom, Lutheran Social Services, 4
City View Transitional Housing Program
ACTION ITEMS:
Consider Request for TIF Assistance, Gerald Paschke; 5-5D
7989 Main Street N.E. N
Consider Authorization of Funding for Highway 65 Street 6-6
Lights
INFORMATION ITEMS:
Update on Housing Replacement Program 7 - 7A
Housing Replacement Program Acquisition Policy 8 - 8B
Linn Redevelopment Project Update 9 - 9A
OTHER BUSINESS:
ADJOURNMENT
� 1
A
HOUSING &
CALL TO ORDER:
CITY OF FRIDLEY
AUTHORITY MEETING
MAY 8, 1997
Vice - Chairperson Schnabel called the May 8, 1997, Housing and
Redevelopment Authority meeting to order at 7:30 p.m.
ROLL CALL:
Members Present: Virginia Schnabel, Jim McFarland, John Meyer,
Duane Prairie
Members Absent: Larry Commers
Others Present: William Burns, Executive Director
Barbara Dacy, Community Development Director
Jim Casserly, Financial Consultant'
Grant Fernelius, Housing Coordinator
Rick Pribyl, Finance Director
Craig Ellestad,.Accountant
Frederic Knaak, City Attorney
Councilmember Billings
Paul & Joyce LaDuke, 6972 Lakeview Drive,.
Lino Lakes, Minnesota
Joe Harding, 821 Raymond Avenue, St. Paul,
Minnesota
Dan King, Linn Companies
Steven Schwartz, Dealers Manufacturing
Wade Carlson, West Central Environmental
Consultants
APPROVAL OF APRIL 10, 1997, HOUSING AND REDEVELOPMENT AUTHORITY
MEETING:
MOTION by Mr. Prairie, seconded by Mr. Meyer, to approve the
April 10, 1997, Housing and Redevelopment Authority.minutes as
written.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON DECLARED THE
MOTION CARRIED UNANIMOUSLY.
CONSENT AGENDA:
1. CONSIDER RESOLUTION AUTHORIZING EXECUTION OF DEVELOPMENT
CONTRACT, COMMERCIAL RAIL PROPERTIES, INC.
2. CONSIDER RESOLUTION APPROVING AND AUTHORIZING EXECUTION OF
TAX INCREMENT PLEDGE AGREEMENT RESPECTING $9,575,000 GENER
OBLIGATION TAX INCREMENT'REFUNDING BONDS, SERIES 1997A
HOUSING & REDEVELOPMENT AUTHORITY MTG., MAY 8, 1997 PAGE 2
3. REVENUE AND EXPENSES
Mr. Ellestad provided copies of additional expenses needing
approval as outlined in his memo dated May 8, 1997.
Mr. Meyer asked that the additional expenses be discussed as a
separate item.
MOTION by Mr. McFarland, seconded by Mr. Prairie, to approve the
Consent Agenda, except the additional expenses.
UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
ACTION ITEMS•
4. CONSIDER RESOLUTION AUTHORIZING EXECUTION AND DEVELOPMENT
CONTRACT, LINN PROPERTIES
Ms. Dacy stated at the last meeting a motion to authorize staff to
prepare a development.contract failed on a tie vote. The HRA did
approve the resolution to create Tax Increment Financing (TIF)
District No. 16 and.to modify the redevelopment program and
project area. Subsequently, the City Council on April 28 approved
its corresponding approvals to create the TIF district.
Ms. Dacy stated, since the HRA meeting, Mr. Casserly has met with
Chairperson Commers who had a number of concerns about the
proposal and subsequent to,that has met with -the developer. Mr.
Casserly has a presentation to update the HRA. At the conclusion
of Mr. Casserly's remarks, staff and Mr. Casserly will.be prepared
to answer any questions. Included in the agenda packet.is a copy
of the resolution to authorize the execution of the development
contract.
Mr.-Casserly-provided copies of his memo dated February 9, 1997,
regarding Project Recapture Provisions and copies-of a proposed
revenue -note. When he and Mr. Commers met, Mr. Commers' concern
was setting up a program where we.would be involved with a tenant
improvement assistance.program, and he.was concerned that while
that may be a worthwhile activity but with limited resources we
need to be careful about how we went about that. Mr. Commers also
pointed out that the HRA has had experiences where we have not
provided assistance where there has been questions involving some
major improvements. They reviewed this project. Mr. Casserly
emphasized that this is not a traditional kind of project. This
really fits into a redevelopment - program, and suggested this be
considered in several different ways.
KousING & REDEVELOPMENT ADTHORITY MTG., NAY 8, 1997 PAGE 3
Mr. Casserly stated half of the project is the demolition of
existing structures, land assembly, site preparation, etc. These
are the very traditional kinds of things the HRA has done for
years. The other half of the project is the restoration of an
existing building and bringing that building up to code. In using
that approach, Mr. Commers acknowledged that he thought the
additional costs were as had been presented or $,175,000, and that
he was comfortable with that figure. Mr. Commers asked Mr.
Casserly to figure out some arrangement to recapture some of the
HRA's investment acknowledging that part of this project seemed to
be more of a tenant improvement activity.
Mr. Casserly stated he went back and found a formula they had
worked on four years ago when trying to do the project across the
street. As you may recall, they had advanced pretty far with the
project. He found•a memo dated 1993 dealing with recapture
provisions, and it was essentially the provisions that had been
worked into a redevelopment contract for the northeast corner.
The.project ultimately did not proceed, but it was not because-of
the arrangements for the development contract. He faxed the memo
to Mr. Commers a few days ago and then spoke with him at length.
Mr. Commers felt comfortable and could support this if we were to
work out some arrangement with the redeveloper for recovery of
half of the investment in the project. Mr. Casserly spoke with
the redeveloper's representative, went through the formula and
explained that this is not cast.in stone.and needs to be worked
out for each .project. We are willing to work this out. They do
understand the concept is to try to recapture part of the
investment and the approach would be to essentially follow the
formula as laid out and cut the bottom line in half representing
that half of "the project is a more traditional redevelopment
project and half is more of a restoration. That is the approach
they have been trying to work out.
Mr. Casserly stated Mr. Harding is here representing Mr. Linn. He
has told.Mr. Harding that he thought this was workable. The
proposed revenue note shows the proposed cash flow. The
redevelopment contract would be very much like those recently done
with a revenue note for $175,000, then it would contain a
recapture provision for roughly half based on the formula.. This
needs to be fine tuned to fit this project.
Mr. Harding stated Mr. Linn was out of town and had asked him to
stand in. He spoke with Mr. Linn today subsequent to his
conversation with Mr. Casserly, and Mr. Linn is very much
generally in agreement but he does not quite understand it because
this just came to them yesterday: Mr—Linn is in agreement.with
his understanding of the proposal. Mr. Casserly and he have
wrestled with.the numbers but he thought they could come to some
HOUSING &.REDEVELOPIENT AUTHORITY MTG. , MAY 8, 1997 PAGE 4
accord. On Mr. Linn's behalf, he would like to say to get on with
the developers agreement and they will work it out. It has to
come back through the HRA anyway.
Ms. Schnabel stated it would appear that there are areas that
still have to be negotiated and worked out. Would something be
done for the next HRA meeting or should the HRA proceed at this
time?
Mr. Casserly stated they know what the improvements will be and
they have reviewed the expenditures and what is reimbursable. The
amounts are worked out. If the concept is acceptable to the HRA,
the only thing they would need to fine tune is the recapture
provisions which must be signed by Chairperson Commers and Mr.
Burns.. He would hope.the HRA could approve the resolution knowing
the final sign off would have to be approved.
Ms. Schnabel.asked if Mr. Harding was in agreement.
Mr. Harding stated they were.
MOTION by Mr: Meyer, seconded by Mr. Prairie, to 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 of Fridley and Linn Property
Holdings, L.L.C.
Ms. Schnabel stated she felt more comfortable to proceed with the
fact that Mr..Commers has had.a chance to review the request and
seems favorably inclined to approve.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SrH1U3EL
DECLARED THE MOTION CARRIED UNANIMUSLY.
Ms. Schnabel asked staff to report back in June.
5. CONSIDER ACQUISITION OF 5800 - 2ND STREET N.E.
Ms. Dacy stated Mr. Knaak was at the meeting to make a brief
presentation to.answer questions that were raised-at the last
meeting. The HRA can.then act on the request to purchase the
property at 5800 - 2nd Street.
Mr. Knaak stated he was asked to come to the meeting to answer
specific questions regarding.the use of the condemnation authority
for the purpose of acquiring single family housing in the City of
Fridley. He asked in response to that issue for some
clarification of what was specifically the issue that staff had in
mind. Ms. Dacy and staff did a good job of focusing his attention
HOUSING & REDEVELOPMENT AUTHORITY NTG., NAY 8, 1997 PAGE 5
on what the general inquiry was at the last meeting. In response
to that, he drafted a memo to Ms. Dacy, a copy of which has been
provided: He would like to go over the options that the HRA has
for condemnation with the City. The condemnation authority, in
the statutes that we are talking about, is authorit.y vested
exclusively in the City Council. In instances where .a hazardous
building or condition is believed to exist, the City can commence
procedure, pass an order which has the effect to commence
condemnation proceedings. By passing an action, the owner that
would have interest in resisting or not wanting abatement or
razing of the hazardous building to occur has 20 days to file an
answer and, at that point if there. is a contest as to whether or
not it is hazardous or whether or not it should be razed, there is
a trial on that issue.
Mr. Knaak stated, subsequent to that, if there is determination-in
favor of the City, the City has a number of options. They can
either follow through with the order and raze the building and /or,
in the language that he likes to use, use the alternative option
where it can raze the building and charge and assess those costs
to the property which would then hopefully be given back to the
City upon sale of the property.
Mr. Knaak stated another option available after the finding or
determination of hazardous conditions is condemnation. At that
point, the:HRA could commence condemnation proceedings and seek to
secure or purchase the property. That is a public purpose and the
City is allowed at that point to transfer the property to the HRA.
Mr. Knaak stated his understanding is that the crux of the
question is if .that is cheaper, is it effective, and is it a good
and viable alternative to voluntarily purchasing substandard
housing. His response to that generally is yes. Ordinarily it
would be better for the HRA to voluntarily acquire property. His
reason for making that statement is that ordinarily.the procedures
and processes that are followed are involved and tend to be
expensive. It is good for lawyers but not necessarily-good-for
lawyers' clients. Because this involves the involuntary
acquisition of private.property, there are .lot of procedural
pitfalls and processes that you must get through in order to
arrive at the end result. If the end result is the acquisition of
property, you have to go through in essence two separate judicial
proceedings in order to get there. It is a very effective
procedure. He has recommended.it for one particular case where
you have abandoned property and there is a serious hazard on site.
Ordinarily, you have no right to come in and raze a. building
because it is private property. Where you have situations where
there are public health and safety involved, you need to be able
to do some things. This is an expediting procedure which would
HOUSING 6 REDEVELOPMENT AUTHORITY MTG. MAY 8 1997 PAGE 6
allow the City to do what needs to be done in relatively extreme
cases. It is used quite sparingly for that purpose. He has been
in practice for 18 years and in that time he has dealt with nine
of these cases. Most of those cases were abatements. In only one
instance did the property end up with the City and that was a*
voluntary purchase agreement.
Mr. Knaak stated it is because of all the things that can happen.
For example, in one instance there was a lien holder who was
engaged in some speculation and by filing the answer to the
original complaint by the City was able to buy for themselves a
three -month delay which was almost all they needed to take full
possession of the property. That is not to say that this is not
an unavailable or unattractive alternative on some occasions.
When a property owner is not available and you are dealing with
what is clearly a hazardous condition, it is a method where you
could expedite the basis to raze the building and, once you have
razed the building, commence condemnation proceedings and follow
through and acquire the property. The way the statute is set up
as a practical matter, you are invariably better off trying to go
to a voluntary acquisition if you have a procedure in place to
assure that the price you are offering is close to the real price
or appraised value. As a practical matter as well, that is not.
likely to be much different from the condemnation proceedings with
all of the costs involved.
Mr. Meyer stated he did not have any real questions at this
moment. He understand the explanation of the statute. He would
like to discuss the matter in general. His concern arises because
of the amount of money that.we• are offering the owner of this .
property. As an example, his house is assessed at $35 /square
foot. As far as he knows, it a completely salable house. The.
habitable area in this residence is assessed at $75 /square foot.
As far as he is concerned, something is out of kilter with the
system of appraisal or acquisition with such a disparity between
an average salable home and this particular residence. It is
unconscionable, and he does not understand it. He thought there
should be other methods to achieve the result of getting rid of
substandard-homes in the City.of Fridley. He did not think they
should pay this kind of money. He understands the difficulty-and
the costs, but those are beside the point in a way. There are
other methods to achieve what we are trying to achieve and still
be fair.to the.owner.. If, for example, we would offer the owner
some amount of money. As he remembers.from the last meeting, this
is a house with 700 square feet, no basement floor, broken joists,
a caved in basement wall, deficient plumbing, bare electrical
wiring, and in need of exterior repair and paint. The house had a
For Sale sign on it. As far as he can see, he cannot conceive of
anyone buying that house. If we want to get rid of the house,
HOUSING & REDEVELOPMENT AUTHORITY NTG., MAY 8, 1997 PAGE 7
offer the owner $20,000 to $25,000 or something of that nature,
but certainly not anything what we are thinking of doing. Then,
if there is movement on the part of the owner, we could to other
things start condemnation proceedings, issue a memo listing the
deficiencies and demand that within a certain period of time to
abate those conditions otherwise there will be some action taken.
This would let the person know that we are serious in getting rid
of that house but not with the kind of money we are talking about.
Mr. Meyer stated he thought.this was something that goes beyond
this particular.residence. We have other residences in the City
that are marginal or substandard, and there are other owners who
will be asking for the same type of largess. He thought this was
wrong and expensive and, in addition, is a scandal on the
taxpayers of this community to give this kind of money for this
kind of housing just for the sake of getting rid of it.- There are
other methods that we should try, and he thought they should re-
examine their procedures. He is fully aware that the City
assessor and independent'appraiser have both blessed this figure.
His answer to that is that there is something wrong with the
system if this is the case.
Ms. $chnabel asked if there were any.other alternatives available.
Mr. Knaak stated, if you are dealing with something that is
generally a hazardous building, the burden is on the City, at
least once, to establish that there is a hazardous condition
before you can go much further with this. If you are dealing with
a nuisance which can be abated, certainly you can raise those
issues and you can say to the owner that you have a substandard
building with probably hazardous. conditions, here are our options
and the amount of time.we will give. for the owner. to abate these
conditions. It.has been his experience that the owner would
probably have abated the nuisance. Most people.who own a home do
try to keep it up. As a practical matter, a house in a
deteriorating condition.is often related to an owner's
deteriorating financial condition as well. As a practical.matter,
that does not seem to create much leverage. Actually going in,
doing. the abatement and assessing it does.take care of the problem
but it may also make the property less salable. The result.of the
cost for the necessary work to abate the nuisance may be assessed,
but by doing that you.may actually increase the cost of the
property that you are trying to recover to greater than what the
market will bear. Certainly, the City has a full range of options
available, and he did not know why at least some of that could not
be.communicated as part of a pro- active effort.
Mr. Burns stated that one of the topics that came up was how do we
spot a nuisance or a hazard. It was staff's opinion that, if the
HOUSING & REDEVELOPMENT AUTHORITY NTG. MAY 8 1997 PAGE 8
nuisance or hazard were not readily viewable from the curb, it is
difficult to assess that a hazard even exists. How easy is it to
enter homes to determine that these conditions exist?
Mr. Knaak stated it is very difficult. The most common use that
he is aware of is the garbage nuisance where there might be a
medical call where a medical person saw the garbage. It can be
difficult. In other cases, it is less difficult but the nuisance
is probably such that you would not need to do much about it.
Mr. Meyer asked if the building inspector could come in for any
reason.
Mr. Knaak.stated no, unless you
repairs or seeking information.
have an ordinance authorizing ei
reason for going in, if someone
a warrant for probable cause to
you can get a warrant but it is
are in the process of doing
As a practical matter, unless you
7try and you have a reasonable
refuses your entry, you will need
enter. Under some circumstances,
not easy.
Ms. Schnabel stated she has heard the terms hazardous, nuisance,
and substandard. She would like to know if there is a distinction
or if there is a definition for each.
Mr. Knaak stated there.are definitions for each. The ordinance
defines nuisance in the City code. Hazardous. as far as property.'
is defined as any building or property which because of inadequate
maintenance, dilapidation, physical damage, unsanitary conditions
or abandonment, constitutes a fire..hazard or a hazard to the
public safety or health.
Mr. Meyer asked if the statute talks about hazards to individual
within the home.
Mr. Knaak stated hazards to health would be garbage. Conditions
other than -that would have to.be a finding on the part of the City
and would have to be quite clear on.what that is. One would have
to persuade a judge to allow the City to intrude on private
property. The courts are reluctant to-do that. The courts have
been very circumspect in allowing cities to go any further than
they need to in order to address the hazard or nuisance.
Ms. Schnabel asked if the problem they are faced with was cbmmon
in other communities. Are there any other communities finding
some answers or success in trying to address these issues?
Mr. Knaak stated he did not have:multi- community experience. He
frankly.finds what the HRA is doing here intriguing because it is
easier and cheaper than what they are doing in other communities.
HOUSING & REDEVELOPMENT AUTHORITY MTG., MAY 8, 1997 PAGE 9
What he sees by and large is that by the time people are prepared
to use the ordinance and take action, they are dealing with a
significant level of neighborhood frustration. The City is
frustrated with repeated attempts to enforce zoning codes and in
dealing with eyesores over a long period of time and people will
resist efforts to do something about it. These tend to be very
difficult cases. To be seeing as he sees here a voluntary effort
strikes him as pretty imaginative. He did not know what
Minneapolis was doing. In other local communities he has not seen
anything like this. There are ways you can as a City leverage the
power that you have under the statutes to bring focus into
negotiations early on, but you need to be aware that there are
pitfalls. It really.is a vehicle of last resort. He recommended
it in Fridley because the owners were not around, there was a
genuine hazard with a broken sewer pipe in the basement, open.
paint cans, etc. Even in this case where there was clearly a real
pressing health and safety issue, it still took quite a long time
before they were able to get into the.building, abate and take
care of the problem. A better solution is to come up to the owner
and ask them if they are interested in selling the property. It
can save everyone a lot of grief. That seems the rational way of
doing it. If you cannot get a good price and you are forced to
abate the situation, then you do have with this condemnation
process a process with teeth but you must know that it is an
uphill fight:
Mr. Meyer stated they have had uphill fights before and have
pulled condemnation proceedings before, but it has not stopped
them from other causes completely besides hazardous and other
conditions. When working on the southwest quadrant project,-we
did not hesitate then. Now we are faced with the situation where
someone is asking us to pay too much for their property, and he
thought they must stop and say this is enough. He is sure it is
cheaper and les's grief, but it goes beyond that. We have to look
at other houses down the line. Are we.sending the message to
other owners of substandard houses that all they have to do is let
their house deteriorate and the City of Fridley and the HRA will
bail them out to the tune of a non - understandable assessment? How
many others are out there waiting for us to kowtow to this kind of
easy path? He thought this was a good-time to try something even
though-it costs us some dollars. Before going to'condemnation
proceedings, offer a low price such as he suggested. He did not
know the circumstances of the individual, The property now.is
probably unsalable. That person would be well advised to listen
to a minimal and fair offer. He thought this is the time to
decide that there is something wrong with the system of
approaching this and at least trying another.approach to these
substandard homes.
HOUSING & REDEVELOPMENT AUTHORITY MTG., MAY 8, 1997 PAGE 10
Ms. Dacy stated she would like to make two comments. One of the
general statements about whether we are going down a road where
the HRA would be duped into paying more costs than what the
property is worth and are we establishing a program to eventually
catch up with us and encourage people not to repair their homes.
Staff is saying that that is not the case. When staff approaches
the property, they have a variety of options available - voluntary
acquisition, tax forfeit procedures, etc. There are three or four
options that staff can bring to the HRA. Because of the right of
entry issues, their ability to walk into someone's home to get an
appraisal is through voluntary contact and by asking the person if
they are interested in selling their property. Staff approached
this acquisition on that basis. Unless the attorney advises
otherwise, based on.what staff knew when they approached this
site, staff 'had no basis to go into the home and identify hazards.
She thought it would not be appropriate to switch gears -on this
site. They approached this site with a series of options and
identified those which fit that particular acquisition. The City
Council is evaluating a point of sale ordinance which would
require correction of hazardous conditions at the time of the sale
of the property. That will not get at every one but that is in
the future for the City Council.
Ms. Dacy stated, secondly as far as this particular site and aside
from the cost issue, the scattered site program was set up to
acquire those properties that are in such a condition and /or.
design that would meet the criteria set out in the statute: There
is a risk that, if we make an offer at one -half the amount as has
been suggested, the owner would turn that down and the property
can remain on the market at an.amount higher than that suggested.
There is the possibility there could:be a buyer. This site meets
our criteria and she would like to see new construction and a new
home to jump start the neighborhood.
Ms. Dacy stated, as a third point, even if we would start
condemnation procedures for this property, her understanding is
that we could identify.these hazards and the owner could say
he /she could fix these and we still do not achieve the purpose of
removing a smaller house and creating newer housing stock in the
area. She did not disagree with finding the most.cost efficient
method to carry out the program. She is suggesting that staff is
doing that. Staff is looking at all the options and choosing the
right tool for the site. She thought they had gone too far with
this site. There is a legal issue here.and she would not
recommend that we change on this particular acquisition. Staff
needs some sense of direction that you want to continue the
voluntary acquisition program. The TIF laws are in place..
Mr. Prairie stated, because this transaction has been going on and
SOUSING & REDEVELOPMENT AUTHORITY MTG., MAY 8, 1997 PAGE 11
before they approve it, he thought they should consider Mr.
Meyer's concerns about homes in the future. Even if he voted for
it, he agreed with Mr. Meyer that we should try to be more cost
effective.
Ms. Schnabel asked if another commission in the City could take a
look at this. The City Council is looking at an ordinance. Could
another commission take a look at this and come up with some
recommendations about these kinds of issues that would lead us to
adopting -an ordinance that would help them in situations like this
in the future?
Ms. Dacy stated she thought this issue is an HRA issue. This is
true redevelopment. We modeled this program after the scattered
site. program in Richfield. Robbinsdale has been.doing this for a
number of years. Out of our program, the City of Crystal is doing
it. The Cities of Minneapolis and St. Paul got in the act after
we proposed our law. In terms of the code enforcement approach to
an acquisition process, it is obvious that the statutes are in
place, but there is also some significant criteria about what has
to be present in that particular structure. Staff is doing that
right now. If the house is owner occupied, it presents another
whole series of issues which makes the voluntary acquisition
cheaper. We do not.have to pay relocation costs. We do not have
to wait six to eight months to get through the condemnation
proceedings. We do not have to argue with the judge that this is
a hazard. The judge is going to defer to the property owner.
This slows.the rehab process. The program has been in place and
successful for the last few years and is cost effective. Staff is
saving the HRA money and recapturing some of the increment back
when a new house is constructed.
Mr. Burns stated he thought Ms: Dacy made a good point when she
stated this is the most effective tool in trying to accomplish the
goal. If we want to see a house rehabbed, it would not be
included in the scattered site program. Most of these properties
are not able to be rehabbed or are too small or the lot is too
small. There is something that we want removed. Code enforcement
does not accomplish that. The only tools we can use are
condemnation and voluntary sale. Both involve an appraiser. No
matter.which we are going to accomplish this objective, we still
have to rely on.the appraiser. If they are not doing their job
properly, there is another. He thought that the appraisers they
use know that there is the possibility of using a review
appraiser. In addition to that, we have our own internal assessor
that works for the assessing division of the finance division to
check on the appraiser. He thought there were plenty of checks
and balances to make sure we have a valid appraisal process. He
is very conscientious about getting the most value for the
HOUSING & REDEVELOPMENT AUTHORITY MTG. , MAY 8 1997 PAGE 12
taxpayers' money.
Ms. Schnabel stated she did not think anyone means this to be
critical of what the City is doing. She is in agreement of the
program. It just seems like ,a high price to pay for a property
that appears to be hazardous or in a nuisance state, and it is
looking for an alternative way to still obtain that property but
without paying such a price. On the other side, the owner could
say they want a fair price for what they have, the market price is
a fair price and they should not be penalized. She did not think
anyone was being critical of the staff or of the program.
Mr. Burns stated he was expressing frustration. If we have the
direction to accomplish the scattered site objective to remove
objectionable properties, we have no alternative than to rely on
the appraiser. Eventually, the tools rely on the appraisers. The
other disappointing aspect is the sale price of the properties.
We do go through a bidding process. It has not been very
attractive from the standpoint of acquisition or from the
standpoint of the sale price. The program does remove some
substandard properties.
Mr. Casserly stated it occurs to him-that the HRA appears to be
experiencing sticker shock. He has worked in other communities
where they have expressed this problem. He did not know if they
had been exposed•to the problems where a contamination issue has
been involved: What is frustrating is that from the municipal
side you believe that the property should.have.a much lower value
because of contaminants or pollution but he has never found the
price-to adequately reflect. that concern. That is what. the HRA is
experiencing in this situation. It does not work out how you
think it should. It is a matter of .having to experience it and
walking away constantly confused. It becomes more obvious when
you are dealing with a site that needs.remediation. He cannot
figure out why the acquisition price is not discounted by the cost
of the remediation. We have to go through an appraisal process .
for acquisition. We are stuck with that and have to work with it.
Mr. Meyer stated his answer to that is why. He has a house with
two floors that are habitable. The tax assessor says that house
is worth $35 /square foot. We are talking about giving $75 /square
foot to someone whose house cannot probably be sold. We are bound
by the tax assessor. We are bound by the appraisers. As far as.
he is concerned, that leaves a great unanswered question of why
are we bound by people who, if this is the case, cannot tell the
difference between a $75 /square foot house and a $35 /square foot
house. That has to be rubbish. There must be more justice in
assessing what people pay for taxes. He cannot believe that there
isn't something wrong.with a whole system that allows that to
HOUSING & REDEVELOPMENT AUTHORITY MTG., MAY 8, 1997 PAGE 13
continue. He thinks staff are excellent. The program is a good
one and administrated very well. He thought there was a point
where we put a check and a balance on a certain phase of the
acquisition. Somewhere we have a right to use our common sense to
go beyond the appraisers and assessors, if you please, and decide.
If they say it cannot be done, maybe we shouldn't try to do it.
We had no reluctance in the southwest quadrant to take the
apartment buildings and take our chances with the commission set
up to appraise it because we wanted that property for other public
reasons. Let us do the same thing with this house.
Mr. Burns stated, in the case of the apartment buildings,
condemnation was a last resort. The City tried for months to
negotiate a purchase price before went to the condemnation
process.
Mr. Meyer stated there if we had offered twice as much as he
wanted or was entitled to, he probably would have taken it; That
is what we are doing with this property as well.
Mr. Burns stated in those condemnation cases we are ending up
paying 130% to 150% of the appraised value on those properties by
doing through the condemnation process.- In looking at the Suh
condemnation, that was a.bona fide rip off and the City paid for
it. We went through a condemnation process-that was a last
resort. That was the only way we were going to get that because
the owners would not negotiate fairly. .
Mr. Meyer stated we went through the process of condemning it,
turning it over to a commission to decide that. We did not
arbitrarily decide to just top fighting. We got disappointed. In
this case, he thought they had an excellent chance of getting
something different from what we are offering. Beyond this is the
precedent we would establish in dealing with some of these things.
He thought it was time to tighten our belts and do the hard thing.
Ms. Schnabel stated she suspected.that we have already entered
into negotiations on this particular property. While the points
are well taken, she thought they have to establish something for
the future, but she did not know that they could stop this at this
point.
Mr. Meyer stated this is just like any real estate sale. It isn't
over until it's over.
Councilmember Billings stated he.thought they had progressed from
the overall general topic to a more specific discussion of an -item
on the agenda. Unfortunately, he does not have enough detail to
HOUSING & REDEVELOPMENT AUTHORITY NTG., MAY 8, 1997 PAGE 14
adequately discuss that item on your agenda so he would prefer to
discuss the overall concept. He came to provide back up
information on some other items but this discussion has him
intrigued. He asked Mr. Meyer, out of curiosity, if his
determination of the square foot pricing included the land value.
Mr. Meyer stated on his appraisal he took $20,000 off for his lot
and he took $5,000 off the other lot. So basically it is
structure to structure.
Councilmember Billings stated he thought they would find on a more
plush home the value of the property becomes a smaller percentage
of the total value. On a home that is in sad shape, the land
value becomes a higher.percentage. He has.no idea what the
appraised value of the land and buildings on these sites are. He
was sure that anyone at home who is watching is going to agree
with.you that, if in fact someone had this on the market, the
first thing he would take a look at would be the.advertised price. _
That is a matter of public information. If that advertised price
is in the realm that Mr. Meyer is speaking of $25,000, then
perhaps you are right. Perhaps the.HRA should take a step back
and re- evaluate where they are at. He would hope that staff and.
the appraisers have taken that fact into consideration. If they
have not, he would be sadly disappointed. In a more general broad
term discussion, he thought.Mr. Meyer mentioned the fact that
there was some condemnation of apartment buildings across the
street: As you will recall, that was a decision that.was made
jointly between the HRA.and the City Council on a 9 to l vote.
Being the one dissenting vote on that, he would like to remind Mr.,
Meyer.that in addition to the cost of the acquisition, the
attorneys fees for the condemnation proceeding, and everything
else, the City paid a substantial sum of money in a lawsuit that
was brought by the occupants of the building.. Through no intent
of the City of Fridley, we somehow managed to do some damage to a
protected class of-people. His guess would be that if we start
looking at the occupants of these properties.that are in such sad
shape we-are probably going to find that they are close to or
below the poverty level in terms of income and we could find
ourselves being faced with an accusation that we would have to
defend in court at substantial..cost to the.City and /or the.HRA
that we are aggressively going out and persecuting this class of
people that cannot afford to maintain their houses. That is not
our intent. As I am sure you are aware, the courts in this land
are severely tilted toward the oppressed, actual or perceived. We
as a City would be perceived as those with deep pockets, and in
our society today we would ultimately lose that. That may be a
defeatist attitude, but he thought that is a practical attitude.
He cannot address the merits of the particular acquisition you
were discussing. He would hope that the HRA would use all
HOUSING & REDEVELOPMENT AUTHORITY MTG., MAY 8, 1997 PAGE 15
diligence and wisdom in making their determination on how they
vote. He thought that this one property notwithstanding the HRA,
staff, and the City Council is pursuing a reasonable course in the
acquisition of scattered sites.
Councilmember Billings stated another factor, all the HRA members
were probably here in the mid -60's when the HRA got started and it
got shelled many years and they were not able to accommodate any
of the things we should have been working on in the mid -60's until
the early 19801s. One of the reasons for that was the scare
tactics of a few people who went around the City and said, if you
elect this guy mayor, he is going to come in and tear down your
houses and they are going to be inside your houses looking at what
you are doing. Certainly, from a political standpoint, he thought
they need to be reassuring the citizens of the City that is not
something that we are advocating. He is not saying that we should
be spending $1 for a 50 cent ice cream cone. There are trade offs
and there are things that we have to take into consideration.
There are events that are well intended but are perceived as other
than well intended. If there are enough people out there that are
willing to be reactionary and militant, we could find ourselves
faced with a situation where we have to wait until the housing
falls down and then see where we are at. He didn't think any of
us wanted to do that. There is a balance somewhere. On this
particular piece of property, he did not know if this could be
achieved. Perhaps it makes sense to pay more because of the
peripheral things that you get.
Mr. Meyer stated he needed.-no reminder of the 1965 HRA. He was
one of the appointees at that time. In addition to people saying
that other people would tear down their houses, the other cry was
that the HRA would saddle your house with unconscionable tax
burdens to pay for renovating other people's properties. He knows
those forces have been mute for the last few years, but they are
still there. This is one reason he has been concerned on this
issue and other issues for.the scattered'sites, loans, etc., that
we create no scandal to the public to make them think that the HRA
is subsidizing people who can do things for themselves readily and
who are here getting special consideration. One way to do that is
to insure that our programs are.based on demonstrated need for the
community and aid is given to those people who truly need aid,.and
to watch how far beyond that line we step.
Ms. Schnabel stated.she thought the-HRA should-move ahead on this
particular proposal.
MOTION by Mr.. McFarland, seconded by Mr. Prairie, to approve the
purchase of 5800 - 2nd Street N.E. and to authorize the Executive
Director to execute the necessary documents to complete the
HOUSING & REDEVELOPMENT AUTHORITY MTG., MAY 8, 1997 PAGE 16
purchase.
UPON A VOICE VOTE, WITH MS. SCHMUML, ME, MCFARLAND, AND MR.
PRAIRIE VOTING AYE, AND MR. MEYER VOTING NAY, VICE- CHAIRPERSON
SCHNABEL DECLARED THE MOTION CARRIED BY A MAJORITY VOTE.
6. ADDITIONAL EXPENSES
Mr. Meyer asked how the acquisition got onto the additional
expenses.
Mr. Fernelius stated ordinarily they would not do this. Given the
circumstances with this particular acquisition and the timing, it
was necessary to.get approval of the check on the agenda. It was
done after the regular agenda went out and it would have been
considered as part of the acquisition. Had the HRA not approved
the acquisition, the check would not have been processed. That is
the reason behind the expense being on.the.agenda.
MOTION by Mr. Prairie, seconded by Mr. McFarland, to approve the
additional expenses as outlined in Mr. Ellestad's memo of May 8,
1997.
UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCMUMEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
INFORMATION ITEMS:
7. FRIDLEY EXECUTIVE CENTER UPDATE
Ms. Dacy stated she had no additional information to report. She
called MEPC to get an update but unfortunately they were unable to
connect. There-are two building proposals out there. At this
time, we don't. have any definitive responses.
Ms. Dacy stated she expects the draft inserts for the community
brochure at any time. She is waiting for the final proofs.which
she will bring before the HRA.
Mr. Meyer stated it seems as.though the HRA authorized the
brochure some time ago. What is the problem that this is being
delayed?
Ms. Dacy stated the brochure folder is done. When.they.prepared
the folder, it contained quotes from some of the major industries
in town and it was time consuming to get the quotes authorized.
On.the inserts, we have about eight different types of inserts on
a variety of topics. This required a lot of research which is
time consuming to put together.
HOUSING & REDEVELOPMENT AUTHORITY NTG., MY 8, 1997 PAGE 17
8. HOUSING FUND UPDATE
Mr. Fernelius stated last Wednesday, he, Ms. Dacy, Mr. Casserly
met with Michael Haley and Kathy Aanerud, who work for the
Minnesota Housing Finance Agency (MHFA), to discuss our request
for participation by the state in funding for our revolving loan
programs. The meeting went well. The MHFA representative seemed
interested in what we were doing. They did not commit to any
particular proposal, but they wanted to meet with us as well as
other first ring suburbs in similar situations to discuss ideas
and go from there. To that extent, it was a positive meeting. We
have more work to do. The sense that staff got from the meeting
was that it is going to take some time before something will
happen. There is a regional task force meeting next Wednesday
involving the first ring suburbs. He will be attending and will
report back at the next meeting.
Mr. Casserly stated a senator have introduced legislation asking
to do a study to analyze the needs of fully developed suburban
communities and to report back to the legislature. Whether the
timing will work for the next legislative session remains to be
seen. It may take longer than that. The entire state did 2100
loans for last year. For our community there were 130 loans for
the same year. That shows the disparity that exists for the
needs. They were interested but he thought they were interested
in the complexity of the program -and how it was being managed.
They were fascinated by how the originations were handled, how the
servicing was handled, the staff time and commitment,.-and saw it
as being cost effective.
9. CONSIDER THREE RESOLUTIONS FOR CONTAMINATION CLEAN- UP-PROGRAM
FOR DEALERS MANUFACTURING. 5130 MAIN STREET N.E.
Ms. Dacy stated this is a request to apply to the Department of
Trade and Economic Development (DTED) Contamination Clean -Up Fund
and the Metropolitan Council Tax Base Revitalization Fund. The
.request was brought to staff's attention by Dealers Manufacturing
Company. They have been in the City since the early 1960's and
are located at 5130 Main Street.. The request is to ask.the HRA to
act as the applicant and essentially the sponsor of a grant
application to each of the above funds. Each of these programs
have been set-up to provide funding sources for companies to.
conduct these types of projects. The total project.cost is
approximately $559,000 and includes costs that have been incurred
to date and also includes costs which will be incurred in the next
five years. 500 of the project cost is proposed to.be funded from
DTED and the remaining 50% would.come from the Metropolitan
Council application. DTED requires a local match which would come
from the HRA_ DTED staff suggested the Dealers Manufacturing
HOUSING & REDEVELOPMENT AUTHORITY NTG.,.MAY 8, 1997 PAGE 18
Company could provide the source of funds for the local match.
Ms. Dacy stated, usually when the HRA provides assistance, it does
recover its funds either through tax increment or through a loan
repayment. A grant has not been a policy of the HRA. The company
is willing to provide a source of funds for the local match.
There is a deadline of next Thursday for both of the grant
applications.
Ms. Dacy stated there is a concrete container under the building
which cracked and leaked contamination into the surface area
underneath the building. When this was detected, the company
hired a consultant in compliance of MPCA requirements that they
prepare an interim response plan for a clean up project. They
have also.installed a new technology well inside the building
which mixes water and air to treat the contaminants below the
surface. This system will be described in more detail by the
consultant.
Ms. Dacy stated, based on the information received to date, about
$273,000 has been spent on the clean -up by the company and they
anticipate spending $208,000 in the next five years. Essentially,
the grant applications will help reimburse the costs to date.
Ms. Dacy stated the HRA is being asked to act as the applicant.
The application form states either the City or a public entity
such as the HRA has to act as the applicant. The company's
consultant, however, would be responsible for preparing the
applications, reports and details. The HRA would essentially act
as a.pass- through agency. The HRA would be responsible for
.reviewing invoices of the work that has been completed and work to
be done verifying that it is consistent with the grant
applications and submitting the invoices to the state or council.
They give the money to the HRA and the HRA passes it on to the
company. After applying on.May 15, the decision would be made in
July. If the applications are awarded, there would be two
agreements that the HRA would enter.into at that time for
administration of the grant. Staff is suggesting a separate
agreement with the company to verify that 1) they would provide
the funds., 2) they would indemnify the HRA from any liability .
issues associated with the clean =up, and 3) they reimburse any
additional costs the City may incur as part of administrating the
grant.
Ms. Dacy stated the information provided includes a resolution
authorizing application to DTED fund, a resolution authorizing
application to the Metropolitan.Council fund, and a resolution
authorizing the chair and executive director to execute an
agreement with the company to verify the three conditions stated
HOUSING & REDEVELOPMENT AUTHORITY MTG., MAY 8, 1997 PAGE 19
above.
Ms. Dacy stated another minor detail is that DTED staff suggested
the payment of the company to act as a local match. She contacted
the DTED staff and asked for a letter from their office or from
the attorney general to verify that this would be an appropriate
source of funds. Typically in the TIF world, a developer payment
as a source of what the state calls "unrestricted funds" is not a
legal source of funds. This is different because it is a grant
application. Staff requested the letter before determination of
the award of the grant that this is appropriate. Staff met with
the company and thought they understood the City's position and
they have agreed to reimburse additional administrative costs.
Mr. Schwartz, Engineering Director for Dealers Manufacturing, and
Mr. Carlson, consultant, are present to answer questions.
Mr. Prairie asked what kind of services has the HRA provided in
the past like this.
Ms. Dacy stated this is new as far as she knew. We have done a
number of grant applications. Mr. Fernelius administers the CDBG
program and the home programs. It is not that it is unusual in
terms of doing the paperwork. These pollution clean -up programs
are really new in the industry. There is a series of programs and
grants to see if some of these contamination.issues'can be
corrected and to enable companies to be able to obtain financing.
so they can continue to operate. The environmental issues are.
putting such clouds on the title and financing issues that it is
becoming difficult for some companies to continue operation.
Mr. Prairie asked if the applications had been done by others
before and if that is now changing.
Ms. Dacy stated the tax based revitalization program was created
as part of the Livable Communities Act passed two years ago.
There were three sources of funds created to help communities
redevelop or create a buildable site for new development. She
believed the DTED grant had been available for two years.
Mr. Prairie stated that clean -ups have been done for 20 years.
Ms.. Dacy stated the federal source.of funds was called the Super
Funds. Some of those funds are administrated through the MPCA.
From what she understands, there are a number of those sites that
have used a substantial amount of the dollars available for that
in addition to funding cutbacks.. This is a local initiative,
local programs set up by the state and region to provide these
funds.
HOUSING & REDEVELOPMENT AUTHORITY NTG.., MAY 8, 1997 PAGE 20
Mr. Schwartz stated he was the Engineering Manager at Dealers
Manufacturing Company. The Dealers Manufacturing Company is a
Minnesota corporation organized in 1961. The company has re-
manufactured Ford engines and engine parts since 1944. The
company acquired Fleet Supply and Machine in 1983 which permitted
the company to expand its business to include distribution of
small to medium size diesel engines. In 1987, the company moved
its St. Paul operations to the Fridley facility. At this time,
the company undertook re- manufacturing diesel engines. They
currently re- manufacture medium size (150 -300 horsepower) diesel
engines at this site. In 1985, they moved the gasoline engine re-
manufacturing from Fridley to Portage, Wisconsin. By 1990, the
company had opportunities to expand its Ford dealership. They
sell basically through the Ford dealerships and have the territory
of North Dakota, South Dakota, Minnesota, Wisconsin and.the upper
peninsula of Michigan.
Mr. Schwartz stated the company positioned itself with warehouses
in Milwaukee and a central warehouse in Minneapolis. In 1996 the
company moved its corporate headquarters and its main distribution
center from the Fridley site to a facility in Brooklyn Center.
The company re- manufactures gasoline, automobile and truck
engines; diesel engines; engine components; and automobile parts.
The company.uses its warehouse facilities in Minneapolis and
Milwaukee to distribute products directly to Ford automobile and
truck dealers. The company also distributes products through Ford
and other re- manufacturers throughout the United States and
directly to Ford Motor Company.
Mr. Schwartz.stated the plant in Fridley is doing nothing but
diesel engines which they are-shipping to the lower 48 states and
to Canada. The.building in Fridley was constructed in.1961 for
the purpose of re- manufacturing gasoline engines and small parts.
It was originally 48,300 square feet. Subsequently with three
additions.were built, the most recent of 7,000 square feet last
year. Currently, they have.66,112 square feet. They currently
have 207 employees on two shifts.and will be adding a third shift
on Sunday. By.the.year 2001, they expect to have 417 employees on
three shifts. Sales are expected to continue to increase through
the year 2000.
Mr. Schwartz stated their employees are from the local area. 500
are from Fridley or the first tier of suburbs connected to
Fridley. Dealers Manufacturing has always been a good partner
with the City of Fridley. In 1995, Dealers received the Fridley
Pride Business Beautification Award in the city.
Mr. Schwartz stated May 2 was a big day for the company. They had
HOUSING & REDEVELOPMENT AUTHORITY NTG., MAY 8, 1997 PAGE 21
been working hard to obtain a QS9000 quality certification and.
last Friday they received unconditional approval. This meant they
had zero.-minor noncompliances. They have been supplier to Ford
Motor Company since 1993. With the current contamination on the
site, they are not able leverage any money against the property.
They have not applied for property tax relief due to the
contamination. They are paying full property taxes. Dealers
Manufacturing is applying for this grant aid to help with their
brown spot. They are requesting this because their capital is not
of infinite depth and without it they would have to make decisions
between the clean -up of the contamination, production equipment
and improvements, and enlargement to the facility.
Mr. Carlson provided handouts providing information on the history
of the project, site map, source area map, UVB cross section and
details, and cost estimates. Mr. Carlson is the environmental
consultant and has been working with Dealers Manufacturing since
19973. His experience with them is nothing but the very.best.
They are a pro- active company in addressing environmental
concerns.
Mr. Carlson stated the engine re- manufacturing process requires a
number of cleaning processes and in the earlier years a lot of
solvents were used. In 1986, Dealers was given an.order to
investigate a potential spill on their property. They thought it
was a spill on the ground surface. That started.with an
investigation in 1988 by the MPCA to investigate reported.spills.
This is now called a site screening investigation. In 1988, they
did not have voluntary investigation programs like today. All
they had was the Super Fund. Dealers Manufacturing went through
the scoring process and was placed on the list of priorities for
the Minnesota Super. Fund. In 1993, they were able financially to
address the contamination issues on the property. That is when he
came on board.
Mr. Carlson stated it started out simple with an overall quality
plan and where the.project would go. At.the time, they did not
know if there was a problem and how big the problem would be. In
1994, they completed both the Phase 1 and Phase 2 work. The Phase
2 work was very extensive and included a significant amount.of
drilling and a feasibility study. They identified some
contamination on the property.,: That contamination was in regard
to an old waste trap that was underneath the building. ..Dealers
had no idea that the problem had occurred. .With the practices-
back in the 1960's and 1970's, these solvents got into the waste.
stream. There was a waste trap below the floor slab that they
cleaned out routinely, but it did leak and soil and groundwater
was impacted.
HOUSING & REDEVELOPMENT AUTHORITY HTG., MAY 8,'1997 PAGE 22
Mr. Carlson stated in 1995 they conducted a pilot testing.
Because the problem was actually underneath the building, without
demolishing the building they had to dig everything up. They
looked at alternatives for treatment in place without causing
significant disruption to the business operations. They went
through a process of selecting remedial alternatives. They came
up with a new German technology which was installed in January
1995. The system has been operating for a year and they have seen
a significant clean -up on the site. This will be going on for the
next five years. Through this project, Dealers Manufacturing has
been able to operate on a voluntary basis, have been pro - active,
and have been able to reduce costs. Dealers has been recognized
by the MPCA as a model site. On the other side, it is very
costly.
Mr. Carlson reviewed the site map indicating the location of the
contamination. The source area map shows a close up view of the
inside of the building and the area of contamination under the
building.
Mr: Carlson stated the UVB cross section and details shows the
technology installed. They do not extract any groundwater to the
surface. They pump water from a lower screen in the well drilled
inside the building. The water is brought into the lower screen
and aerated in-place so what you have is an in place circulation
cell. Water passes through that stripping unit multiple times.
Contamination is drawn off by vacuum and exhausted off the top of
the building. They have been running this for 16 months and have
found it very cost effective.
Mr. Carlson stated the last page of the handout is a breakdown of
the costs including incurred costs and estimates of future costs.
Mr. Carlson stated, regarding the grant applications, typically
these programs work with the voluntary programs. They require
that you have an approved response action plan. Dealers
Manufacturing was a little unusual in the fact that they had to do
some immediate clean -up work and do some aggressive work in the
source area. Their interim response is working so well that they
will not have to go through a final stage. They have the
qualifications for meeting the requirements for the grant.
Dealers again is a little unusual because they are a responsible
party. If the property was vacated, the state Super Fund would
look for responsible parties for remediation-of the property. It
is a bit unusual, but the grants provide a good opportunity to get
reimbursed for some of the past costs and for future costs.
MOTION by Mr. Meyer, seconded by Mr. Prairie, to recommend
approval of a Resolution Authorizing Execution and Delivery of an
HOUSING & REDEVELOPmENT AUTHORITY MTG., MAY 8, 1997 PAGE 23
agreement By and Between the Housing& Redevelopment Authority In
and For the City of Fridley and Dealers Manufacturing Company for
a Pollution Clean -Up Program; a Resolution Authorizing Application_
for the Tax Base Revitalization Account; and a Resolution
Authorizing Application to the Department of Trade and Economic
Development for Contamination Clean -Up Funds for Dealers
Manufacturing.
UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
10. RESOLUTION IMPLEMENTING THE PROVISIONS OF PREVAILING.WAGE
nRDTNAM F.
Ms. Dacy stated no action is proposed. She provided-copies-of the
ordinance adopted by the City Council. The ordinance would not
apply for the following: a) projects with a value of $25,000 or
less, b) housing projects or programs for owner occupancy, c)
housing projects or programs for rental rehab with.eight or fewer
units, and d) and residential rehabilitation projects funded by
non -HRA or community funds. Unless otherwise indicated, staff
will place this on the June agenda to approve a corresponding
resolution as it applies to development contracts for the HRA
projects.
Mr. Meyer asked what the status was of this type of ordinance in
other communities.
Ms. Dacy stated, in the suburban community, the City may be the
first in terms of a local ordinance. It is typical for the
prevailing wages to apply in all suburban communities when state
funds or community funds are used.
Councilmember Billings stated he was available for questions The.
City Council adopted -the resolution setting the policy for the
implementation of the ordinance based on the policy of Anoka
County. Basically, they used their language primarily. The City
Council did on a unanimous request of the HRA implement a similar
policy for placing it in our development contracts so the
developer can.see how they are to interact with the their
contractors. He talked with Chairperson Commers about the
changes. Mr. Commers seemed to be comfortable with those changes
and, in concept, thought that the adoption of a policy by the HRA
was a reasonable practice.
11. HIGHWAY 65 STREET LIGHT DISCUSSION
Ms. Dacy stated a number of years ago the intersection design for
the Lake Pointe intersection was reviewed and approved by the City
and the HRA. A few months ago, we discussed this at the budget
HOUSING 6 REDEVELOPMENT AUTHORITY NTG., MAY 8, 1997 PAGE 24
workshop and she advised the HRA that the streetlight issue may be
coming up.
Ms. Dacy stated it is now time to revisit the issue. The City
receive ISTEA funds which reduced the HRA's involvement in the
project financially from $1.9 million down to $389,000. It is
appropriate to decide whether or not the City wants to pursue
installation of the street lights along Highway 65 north to East
More Lake Drive. The City Council discussed this at their meeting
last Monday. Councilmember Schneider was not able to attend the
meeting. However, a majority were in favor of the project if
staff would meet .individually with Councilmember Schneider, if the
HRA would evaluate the proposal and determine if it is also
agreeable, if there is any funding source which the HRA would be
the logical option,.and the mayor requested a neighborhood
meeting.
Ms. Dacy stated, while staff is not asking the HRA to decide
anything at this time, they are asking for general direction if
the HRA is willing to evaluate the proposal. The consultants for
the intersection design need to know whether or not to include it
in the plans and specifications by July 1. They do have time to
conduct a neighborhood meeting. Staff would then propose an
action item on the June agenda. She reviewed the proposed
location of the street lights.
Mr. Prairie asked what the street lights looked like.
Ms. Dacy stated there were a number of options. The lights are
basically the typical highway light that is 40 feet tall. The
standard could be square, round or fancier with decoration. The.
spacing is at 150 feet. NSP and MnDOT would have to review the
spacing according to their standards. The lights would be located
on either side.of the right -of -way as you go north on Highway 65
stopping at East Moore Lake Drive. There are approximately 26
standards and costs vary depending on the type of fixture selected
and the number required.
Ms. Dacy stated it was suggested at the City Council meeting that
before the neighborhood meeting the City should pick the standard
it would like to proceed with and provide an informational meeting
around that particular design. The neighbors invited would be
those on the west side of the lake and east of Central Avenue
across from the beach area. Staff would answer questions and
assure the residents that the lights would be just on the highway.
Ms. Dacy stated she brought this-to the HRA to bring it to their
attention, to answer questions, and to see if the HRA had any
initial comments on this proposal. These costs would-be in
HOUSING 6 REDEVELOPMENT AUTHORITY NTG., MAY 8, 1997 PAGE 25
addition to the $389,000. However, the City and HRA are
experiencing a savings because of the receipt of the ISTEA funds.
Ms. Schnabel asked if the purpose of the lighting was decorative
or for safety. Is this a requirement?
Ms. Dacy stated she thought the lighting could be both decorative
and for safety. MnDOT does not require the lighting. If we
choose to install it, the City would have to comply with their
standards, design criteria, height and wattage. What is permitted
is the same as what is represented in a memo from Mr. Flora 10
years ago. They are using the same assumptions as 10 years ago.
Ms. Schnabel stated, if MnDOT does not require it, the lighting
then becomes an option to do it on our own.
Ms. Dacy stated to choose to install the lighting becomes
decorative in purpose but, once they install it, they may have to
meet some criteria. The thought process 10 years ago was the
overall design and decorative approach. At that time, there was
the University Avenue corridor study and design standards
established. In reading the comprehensive plan from the 1980's,
there was a policy that the City in certain areas should invest in
design improvements to establish an attraction to the area, to
attract business and industry, and to try to improve the
appearance of the overall area.. One of the comments was that it
helps to add an identity to the community. That is the same
concept that was discussed a number of years ago.
Ms. Schnabel asked if there was any.statistics to indicate there.
is a safety factor on Highway 65 at night.
Ms. Dacy stated she can research that. There is a Highway 65
corridor committee. She did know that an.accident analysis was
done as part of their work program. They are looking at all the
intersections from Columbia Heights to the northern border of
Anoka County. They are looking at the entire road design and
signal systems. The design at I -694 will help in their traffic
flow. Staff did a video showing other examples of similar
projects in other communities.
Ms. Schnabel stated she was asking those questions because her
initial reaction is that she is not in favor of lights going up on
the lake. If we put in light standards, it can detract from the
lights that are there now. There is a certain something that
highlights the lake when lights shine on it. She would hate to
see us detract from that. She thought it was unique and a plus
for the City. She was not sure they needed this lighting.
HOUSING & REDEVELOPMENT AUTHORITY HTG., MAY 8, 1997 PAGE 26
Mr. McFarland asked why the cost burden falls on the HRA rather
than on the City.
Ms. Dacy stated it is a policy question that the City Council and
HRA have to work out. In this case 10 years ago, a lot of the
design improvements and installations have typically been paid for
by the HRA as part of a revitalization program. In the case
approved tonight on 57th Avenue, tax increment districts are
established to help pay for the cost. In the past, the City has
assumed the role by paying the electric and maintenance for the
street lights. She believed there was a lot of discussion on the
maintenance role and who does it. Because this intersection and
the highway links Lake Pointe and Moore Lake, she thought that was
why it was linked to the HRA. There will be an action item on the
June agenda requesting installation.
12. UPDATE ON OSBORNE ROAD
Ms. Schnabel stated staff's memo indicated they are still waiting
for enough participation.
13. UPDATE ON MEETING WITH ANOKA COUNTY
Mr. Fernelius stated the Anoka County expressed their concerns
that our decision to go with CEE has had the unintended
consequence of increasing their cost to administer the program.
Staff talked with them. Nothing was resolved. Staff reiterated
their position that the reason they chose CEE was to lower costs,
to consolidate services under one roof with one agency, and to
give better service to residents. Anoka County seemed to respect
that, but for some reason wanted Fridley staff to resolve that
issue which they did not feel was necessarily their
responsibility. The City has a contract with CEE for two years.
When that contract is over, staff would evaluate the options that
are available at that time.
14. FRIDLEY LOAN PROGRAM SUMMARY
Ms. Schnabel stated this was provided for their information.
15. AMERICAN - PLANNING ASSOCIATION NATIONAL CONFERENCE
Ms. Dacy attended the American Planning Association National
Conference held in San Diego.
ADJOURNMENT
MOTION by Mr. Prairie, seconded by Mr. Meyer, to adjourn the
meeting.
c,
HOUSING & REDEVELOPMENT AUTHORITY MTG., MAY 8, 1997 PAGE 27
UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED AND THE MAY 8, 1997, HOUSING AND
REDEVELOPMENT AUTHORITY MEETING ADJOURNED AT 9:50 P.M.
Respectfully submitted,
r,
+tip L'Vi '1 ( U'/
Lavonn Cooper
Recording Secretary
S I G N- I N S H E E T
HOUSING AND REDEVELOPMENT AUTHORITY MEETING, May 8, 1997
Nam
Address /Business
G�aLD11
LX
&n.42-
A
A
MEMORANDUM
HOUSING
REDEVELOPMENT
AUTHORITY
DATE: June 6, 1997
TO: William Bums, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Resolution Implementing the Provisions of Prevailing Wage
Ordinance
The City Council at its May 5, 1997 meeting adopted a resolution providing for the
implementation of the prevailing wage ordinance which was also adopted for second
and final reading at the same meeting. Councilman Billings requested that the HRA
adopt a similar resolution pertaining to the HRA's contracts and bids.
The proposed resolution, except for Section 4 which refers to the City Council
resolution, closely mirrors the City's resolution. The language ofthe resolution is .based
on contract language from the Anoka County Highway Department documents. The
resolution provides for a penalty of 5% of the contract amount if prevailing wages are
not properly paid in accordance with Ordinance No. 1095 and the proposed resolution.
RECOMMENDATION
Staff recommends that the HRA adopt the proposed resolution.
BD /dw
M -97 -271
1�
06/05/97 THU 15:31 FAX 612 885 5969 BRASS MONROE
KRAss
MONROE'
KRASS MONROE, P.A.
■ James IL casserly • ATTORNEYS AT LAW -
Dtred Dial• (612) 885-12%
MEMORANDUM
TO: Fridley Housing and Redevelopment Authority
Bill Burns, Executive Director
Barbara Dacy, Community Development Director
FROM: James R. Casseriy
RE: Resolution for the Payment of Prevailing Wages
Our File No. 9571 -12
DATE: June 5, 1997
444 FRIDLEY • R002-
;.s
Attached you will find a Resolution for the HRA regarding the payment of Prevailing Wages.
I have modeled this after Resolution 97 -38 adopted by the City to implement .Ordinance
1095.
The Resolution simply implements the Prevailing Wage .Ordinance for the Authority. In an
attempt to eliminate any confusion, I have attached a copy of the Ordinance to the HRA
Resolution. If there are any questions or problems, please give me a call.
JRC/kh
Encl
F%FRIDUM'ACORW
SUITE 1100 SOUTHPOINT OFFICE CENTER - 1650 Wen* 90-- ,STREET - BLOOMINGTON. MINNESOTA 55431 -1447
TELEPHONE 612/885.5 1A ;StuiLE 612/885.5969
06/05/97 THU 15:31 FAX 612 885 5969 BRASS MONROE
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE
CITY OF FRIDLEY
COUNTY OF ANOKA
STATE OF MINNESOTA
RESOLUTION NO.
X44 FRIDLEY @003
A RESOLUTION OF THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR
THE CITY OF FRIDLEY, MINNESOTA, FOR THE ADOPTION OF A POLICY AND
CONTRACT LANGUAGE IMPLEMENTING THE PROVISIONS OF ORDINANCE NO. 1095,
PROVIDING FOR THE PAYMENT OF PREVAILING WAGES ON CERTAIN PROJECTS
AND CONTRACTS WITHIN THE CITY
BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the
Housing and Redevelopment Authority in and for the City of Fridley, lV =esota (the "Authority ")
as follows:
Section 1. Recitals.
1.01. The City of Fridley, Minnesota (the "City'), has adopted a certain Ordinance,
Number 1095 (the "Ordinance'), providing for the payment of the .prevailing wage to workers
within the City under certain specified conditions and circumstances, which Ordinance is attached
as Exhibit A to this Resolution.
1.02. The City has adopted Resolution No. 97 -38 implementing the provisions of
Ordinance No. 1095.
1.03. The Authority wishes to provide specific guidance to the public and its own
employees, as well as contractors and others doing or wanting to do business with or in the City,
as to how it expects the Ordinance to be implemented in contracts and work governed :by the
Ordinance.
Section 2. Adoption of Policy for Payment of Prevailing Wages.
2.01 The Authority adopts as its policy concerning all bids and contracts
governed by the Ordinance that the following language, either fully or by express reference to the
Ordinance and this Resolution, shall be included in all such bids and contracts, and that this same
language shall operate as the ongoing policy of the Authority with respect to any such bids and
contracts:
The Contractor agrees that the Contractor's laborers and mechanics and any
subcontractor's, of any tier, laborers and mechanics who work on this project and who fall within
U
06/05/97 THU 15:31_141_012 885 5969 BRASS MONROE --» FRIDLEY JM 004.
Resolution No. , Page 2
any job classification established and published by the Minnesota Department of Labor and
Industry shall be paid, at a minimum, the prevailing wage rates as certified by said Department.
Each Contractor and subcontractor of any tier performing work on this project shall post on the
project the applicable prevailing wage rates and hourly basic rates of pay for the County or area
within which the project is being performed, including the effective date of any changes thereof,
in at least one conspicuous place for the information of the employees working on the project.
The information so posted shall include a breakdown of contributions for health and welfare
benefits, vacation, benefits, pension benefits and any other economic benefit required to be paid.
1. Definition.
The definition of "laborer" and " mechanic" used in connection. with prevailing wages shall
be that definition contained in 29CFR Part 5.2(m).
2. Submission of Payroll.
a. Upon request of the Authority, the contractor and subcontractors, if any, shall
submit to the Authority weekly for each week in which any contract work is
performed, a copy of all pdyrolls. The payroll submitted shall set out accurately
and completely all the information required to be maintained under Section
5.5(a)(3)(I) of regulations, 29CFR Part 5.
b. Each payroll submitted shall be accompanied by a "Statement of Compliance"
signed by the contractor or subcontractor or their agent who supervises the
payment of the persons employed under the contract and shall certify the
following. .
(1) That the payroll for the payroll period contains information of-the type
required to be maintained under Section 5.5(x)(3) of regulation 29CFR Part
5, and that such information is correct and complete.
(2) That each laborer or mechanic (including each helper, apprentice and
trainee) employed on the contract during the payroll period has been paid
the full weekly wages earned, without rebate, either directly or indirectly,
and that no deductions have been made either directly or indirectly from the
full wages earned.
(3) That each laborer or mechanic has been paid not less than the applicable
wage rates and fringe benefits or cash equivalent for the classification of
work performed as specified in the applicable wage determination
incorporated into the contract.
1C
U6/U5/97 THU 15:32 FAX 612 885 5969 BRASS MONROE FRIDLEY 1AD05
Resoltution No. , Page 3
(4) The contractor or subcontractor shall make the records required under this
paragraph available for inspection, copying or transcription by the Authority
and shall permit the Authority to interview employees during working hours
on the job. If the contractor or subcontractor fails to submit the required
records and make them available, the Authority may, after written notice to
the contractor, take such action as may be necessary to cause the suspension
of further payments, advance, or guarantee of funds.
3. Violation: Lim for Unpaid W—azes.
In the event of any violation by the contractor or subcontractor relating to the prevailing
wage provision in this contract, the contractor shall be liable for the unpaid wages.
4. Withholding of Unpaid Wa es
The Authority may, upon its own action, withhold or cause to be withheld from any
monies payable on account of work performed by the contractor or any subcontractor such sums
as the Authority may determine to be necessary to satisfy any liabilities of such contractor or
subcontractor for any unpaid wages as required herein
5: Fn Benefits.
The Contractor and subcontractor shall pay fringe benefits in the manner and in
accordance with the 1964 amendments to the, Davis -Bacon Act (Public Law 88 -349) and the
implementing regulations contained in 29CM Subpart B. 5.20, et seq.
6. Lignidated
If the Contractor or any subcontractor of any tier does not pay its laborers and mechanics
prevailing wages as provided herein, the Contractor shall be liable to and pay to the Authority, as
liquidated damages, as sum equal to five .percent (5°/a) of the contract amount. The Authority
may deduct any money due or coming due to the Contractor such sums as the Authority may
determine to be necessary to satisfy any liability of the Contractor to pay liquidated damages as
Provided herein. Any monies collected or deducted are not to be construed as penalty but as
liquidated damages to compensate the Authority for the Contractor's and/or subcontractor's
failure to pay prevailing wages. The rights'and remedies provided for in these specifications shall
be in addition to and not a limitation of any rights or remedies otherwise available at law. In any
lawsuit involving assessment or recovery of liquidated damages, the reasonableness of the charges
therefore shall be presumed, and the amount assessed shall be in addition to every other remedy
now or hereinafter enforceable at law, in equity, by statute or under contract.
1D
06/05/97 THU 15:32 FAX 612 885 5969 BRASS MONROE X44 FRIDLEY jjh 006
Resolution No. , Page 4
7_ Termination of Contract.
A violation of any of the above- stated provisions in a contract governed by the Ordinance
shall constitute a substantial breach of that contract and shall constitute ground for termination
Adopted by the Board of Commissioners of the Authority this day of
199.
ATTEST:
William W. Burns, Executive Director
Larry R. Commers, Chairman
1E
06/05/97 THU 15:32 FAX 612 885 5969 KRASS MONROE 444 FRIDLEY
ORDINANCE NO. 1095
AN ORDINANCE OF THE CITY OF FRIDLEY, K MESOTA, ADOPTING THE
PREVAILING HOIIRS OF LABOR AND PREVAILING WAGE RATS ON CERTAIN
PROJECTS FOR OR WITHIN THE CITY
The City Council of the City of Fridley-does ordain as follows:
SW&iVision ?. Legislative Findings. The City of Fridley finds it to
be in the best interest of its citizens that buildings and public works
projects constructed with City funds be constructed and maintained by the
best means and highest quality of labor reasonably available, and that
persons working under contract on buildings and public works projects
constructed in whole or in part with city funds should be compensated
according to the real value of the services they perform, which for
purposes of this ordinance, is defined as the prevailing wage and hours
of employment.as determined for the City by the Minnesota Department of
Labor and Industry, pursuant to Minnesota Statutes, Section 177.42,
subd. 6.
sUb ivision 2. Prevailing Wage and Hours .on Certain City- Related or
Funded Projects.
a. Wages paid for all work performed by contractors and
subcontractors that is financed in whole or in part by funds
obtained by bonds issued by the City, including but not
limited to Industrial Revenue Bonds, and all projects let
after May 1, 1997, financed by General Obligation Tax
Increment Bonds shall be paid in accordance with the
prevailing wage and hourly rate.
b. wages paid for all work performed by contractors and
subcontractors on any project let after May 1, 1997, that is
financed in whole or in part by City funds shall be-paid in
accordance with the prevailing wage and hourly rater
c. wages paid for all work performed on any project for a
Developer in conjunction with the Developer's development of
real property in the City if the Developer purchases said real
property from the City, or if the City grants or loans money
to the Developer for the development of said real property,
shall be in accordance with the prevailing wage and hourly
rate.
d. The term -City- shall refer to the City of Fridley and to all
related agencies, including, but not limited to all. Housing
and Redevelopment Authorities and Economic Development
Authorities created by the City of Fridley.
1F
Q 007
usiu5ia7 Ynu 15:83 FAX 612 885 5969 KRASS MONROE FRIDLEY �J008
Page 2 - -- ORDINANCE NO_- 1095
Subdivision 3. Exceptions. This ordinance shall not apply to the
following circumstances:
a_ Any project financed by City funds or bonds authorized by the
City as provided in Subdivision 2 that has a value of
$25,000.00 or less or a value equal to or less than the amount
required for sealed bids by Minnesota Statutes, Section
471 -345, subd. 3.
b. Any housing project or program within the City directed to or
marketed for owner occupancy; or
C. Any housing project or program directed at rental units
containing eight or fewer units; or
d- Any residential ,rehabilitation project, regardless of size,
entirely paid for with non -City funds.
PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 5TH
DAY OF MAY, 1997.
ATTEST:
WILLIAM A. CHAMPA - CITY CLERK
First Reading: March 31, 1997
Second Reading: May 5, 1997
Publication: May 15, 1997
1G
NANCY J_ JORGENSON - MAYOR
MEMORANDUM
HOUSING
REDEVELOPMENT
AUTHORITY
DATE: June 6, 1997
TO: William Bums, Executive Director of HRA L
FROM: Barbara Dacy, Community Development Director
SUBJECT: Annual Election of Officers
The HRA by -laws require an annual meeting to be held the second Thursday of June
for the purpose of electing officers of the Authority. On June 7, 1996, Larry Commers
was elected as Chairperson and Virginia Schnabel as Vice - Chairperson. This item has
been placed on the Consent Agenda to continue Mr. Commers and Ms.. Schnabel in
their current positions. If the HRA disagrees with these nominees, this item should be
removed from the Consent Agenda.
Staff recommends the HRA appoint Larry Commers as Chairperson and Virginia
Schnabel as Vice - Chairperson. -
BD /dw
M -97 -276
2
TO: FRIDLEY H.R.A
FROM: CITY OF FRIDLEY
RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES
MAY 1997
TOTAL EXPENDITURES - MAY 1997 :-:-:t21Alggt
File :.\EXDATAIHRAMF197BILL)ds Details
3
Account #'s for
Account #'s for
CR
HRA's Use
City's Use
Code
ADMINISTRATIVE BILLING:
ADMINISTRATIVE PERSONAL SERVICES
20,394.75
101 - 0000 -341 -1200
H1
ADMINISTRATIVE OVERHEAD
284.13
101 -0000- 336 -3000
HA
COMPUTER OVERHEAD
20626
101 -0000 - 336 -3000
HA
(For Micro & Mini computers)
TOTAL ADMINISTRATIVE BILLING :
460 - 0000 - 430 -4107
20.885.14
OPERATING EXPENSES:
OFFICE DEPOT - SUPPLIES
262- 0000 - 430 -4220
40.46
236-0000- 336 -3000
HA
USPS - POSTAGE
262 -0000- 430 -4332
64.55
236-0000 - 336 -3001
HA
STAR TRIBUNE - WANT AD
262 -0000- 430 -4334
110.98
236 - 0000 - 336 -3002
HA
CAREER TRACK INC - METZDORFF
262 -0000-430 -4337
75.00
236-0000 - 336 -3003
HA
USPS - POSTAGE
460-0000- 4304332
28.35
236-0000 -336 -3004
HA
AT &T -PHONE SERVICES
460 - 0000-4304332
4.26
236-0000- 336 -3005
HA
US WEST - PHONE SERVICE
460-0000- 430 -4332
24.54
236-0000- 336 -3006
HA
TOTAL OPERATING
EXPENSES:
348.14
BENEFITS EXPENSES:
CITY OF FRIDLEY - HEALTH INS
262 -0000- 219 -1001
0.00
236-00 0-219 -1001
11
CITY OF FRIDLEY - DENTAL INS
262 -0000- 219 -1100
0.00
236- 0000 - 21.9 -1100
12
CITY OF FRIDLEY - LIFE INS
262 -0000- 219 -1200
7.00
236 -0000- 219 -1200
13
TOTAL BENEFITS EXPENSES:
,00
TOTAL EXPENDITURES - MAY 1997 :-:-:t21Alggt
File :.\EXDATAIHRAMF197BILL)ds Details
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MEMORANDUM
HOUSING
REDEVELOPMENT
DATE: June 5, 1997
AUTHORITY
TO: William Bums, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Presentation Regarding City View Transitional Housing
Program
Pam Bloom and Bill Vanderwald of-Lutheran Social Services (LSS) will attend the-June
120 1997 HRA meeting to review the success of the transitional housing program at the
four -plex at 380 - 5r Place N.E. As you are aware, the HRA leases the building to
ACCAP who in turn works with LSS to deliver the transitional housing service. The
program has been in place since the Fall of 1995. Enclosed in the packet are folders
which contain the demographics of the families that have been served by the program.
and also copies of newspaper articles from the Star Tribune regarding the volunteerism
at the complex. Bloom reports that a majority of the families served are from Fridley or
the immediate area.
No action is needed on this item.
BDJdw
M -97 -268
P
MEMORANDUM
HOUSING
REDEVELOPMENT
AUTHORITY
DATE: June 6, 1997 �y
TO: William Bums, Executive Director of HRA'
FROM: Barbara Dacy, Community Development Director
SUBJECT: Consider Request for TIF Assistance; Gerald Paschke, 7989
Main Street N.E. .
BACKGROUND
In 1985, Gerald Paschke requested assistance from the HRA to construct a 34,932
square foot industrial building at 7989 Main Street N.E. The HRA provided $43,000 of
assistance for site preparation. This project was also completed in conjunction with
another.industrial building located at 8010 Ranchers Road N.E. Ron's Ice is currently
leasing a majority of the existing building on Main Street.
PROPOSED REQUEST
The developer has received a building permit to construct a 12,000 square foot addition
onto the building at 7989 Main Street N.E. As part of the addition, the developer has
submitted a letter stating that approximately $100,000 worth of site work was necessary
to remove poor soils and import news soils. The Chief Building Official reviewed a 1981
soils report regarding the area where the soil conditions existed and has verified the
severity of the soil condition and the amount of material that has been removed and
imported to the site.
The 12,000 square foot addition will produce $71,809 in tax increment by the end of the
district in 2007 (present value amount). The project cost of the 12,000 square foot
addition'is estimated to be approximately $304,000 (approximately $25 /square foot).
The addition brings the total value of the building to $1,244,650. Using the typical HRA
guideline of 5 %, the-amount of assistance equals $62,232.
5
TIF Assistance; Gerald Paschke
June 6, .1997
Page 2
Although the developer is requesting $100,000, the project will only generate enough
increment to match the 5% HRA guideline. Typically, the HRA approves a development
agreement prior to initiation of activity. The developer is requesting that the HRA
provide assistance based on the extraordinary costs of soil corrections in this area,
despite the fact that work has started on half of the project.
Should the HRA agree to the assistance, staff suggests that the development contract
be based on the typical procedure that the project be completed and that the tax
increment not be provided until a certificate of completion has been issued. It is also
recommended that a pay- as- you-go approach be used.
RECOMMENDATION
Staff recommends that the HRA authorize staff to prepare a development contract
providing $62,232 of tax increment assistance via a Limited Revenue Note and subject
to the developer completing the 12,000 square foot addition.
BD /dw
M -97 -273
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P.O. BOX 308, ROGERB, MN 55374
TELEPHONE (8121 428 -7711 FAX 4812) 428 -7712
May 1, 1997
Barb Dacy
City of Fridley
6431 University Avenue NE
Fridley, MN 55432
Dear Barb
This letter is written
at 7989 Main Street in
directly south of 7989
approximately
It will take/10,000 yaj
to correct the ground.
.with regard to the land I am developing
Fridley, MN. Actually the property is
Main.
-ds of material out and 10,000 yards in
The estimated cost is as follows:
The material out and in - $50,000.00
Labor and Equipment 45,000.00
Total material, labor and
equipment $95,000.00
If there is anything else you will need, please.call me at
428 -7711.
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MEMORANDUM
HOUSING
REDEVELOPMENT
DATE: June 6, 1997
AUTHORITY
TO: William Burns, Executive Director of HRA 4 A-
FROM: Barbara Dacy, Community Development Director
SUBJECT: Authorize Funding for Highway 65 Street Lights
At the meeting on May 8, 1997, the HRA expressed concerns about installing the street
lights along the Highway 65 causeway. Since that meeting, a significant amount of
work has been completed leading staff to recommend the following:
1. The HRA and City Council share the costs for the installation equally. A better cost
estimate has been determined since last month. Depending on the fixture selected,
the cost for the lights between the intersection and East Moore Lake Drive will range
from $104,000 (Executive Style) to $119,600 (Shepherd's Hook). Therefore, the
HRA cost would only be-$60,000. Installing the lights now as part of the intersection
work is the most opportune time to do so.
2. The Highway 65 intersection represents a "front door" to the City. The new
intersection plus the street lights will create a more positive impression of the City
and will convey a message that the City is committed to quality development and
improvements.
3. The Shepherd's Hook standard is recommended (see attached drawing). It mimics
the decorative standard already in place at East Moore Lake Drive and its "nautical"
appearance will accent Moore Lake.
The attached memo describes in more detail the information which has been gathered
in the last few weeks. The. City Council will discuss this item on June 9, 1997.
Highway 65 Street Lights
June 6, 1997
Page 2
RECOMMENDATION
Staff recommends that the HRA authorize up to $60,000 for installing street lights on
Highway 65 to East Moore Lake Drive, and direct SEH to include the lights in the bids
and specifications for the intersection.
BD /dw
M -97 -274
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COMPARISON OF COSTS
EXECUTIVE
FONTANA
HUMBOLDT
FRANKLIN III
$104,000
($4,000 /std)
$106, 600
($4,100 /std )
$111,800
($4,300 /std)
$104,000
($4,000/std)
SHEPHERD'S HOOK $119,600
($4,600/std)
6C
MEMORANDUM
DEVELOPMENT DIRECTOR
DATE: June 6, 1997
TO: William Bums, City Manager
FROM: `J Barbara Dacy, Community Development Director
SUBJECT: Highway 65 Street Light Discussion
Since City Council discussion on the Highway 65 street lights on May 5, 1997, staff has
gathered additional information to respond to a variety of inquiries.
1 Councilman Schneider requested accident history along Highway 65 during the day
and evening hours. SEH has requested MnDOT to submit this information;
however, MnDOT has been slow to respond. It is hoped that the information will be
available for Monday's meeting.
2. Councilwoman Bolkcom asked staff to find other communities where the
"Shepherd's Hook" standard was being used. The Shepherd's Hook is the common
name for the Lumec Domus which was shown to the City Council on May 5� 1997
(drawing attached). The cost per standard for this style is $4,600. The City of
Wayzata is installing this type of standard this week as part of its City -owned marina
redevelopment project of the former Minnetonka Boat Works (a 20 foot standard is
being installed versus the proposed 40 feet here). There are residential areas
surrounding the marina as well. We will be taking pictures or video either this
weekend or on Monday.
In addition, the City of Anoka has used the Shepherd's Hook standards in its park
next to the 1 -169 bridge (Two Rivers Historic Park). Photos have been taken of this
site (I have not yet personally seen the site as of yet).
3.. Additional research has been conducted about the number of standards which
would be required by MnDOT and NSP. SEH has advised that 25 standards would
up
ti
Highway 65 Street Lights
June 6, 1997
Page 2
be acceptable if they are 40 feet tall and have 400 watt high power sodium lights at
150 foot staggered spacing. This is consistent with the lowest estimate provided by
staff at the May meeting.
The consultant also advised that the proposed fixture has a flat glass which contains
the light source entirely. As a result, the light is directed straight down toward the
pavement. Some fixtures like the City's double ball decorative lights do not shield
the light source and the glare is controlled by the amount of wattage. There would
be a minimum of approximately 300 feet of distance between the Highway 65 lights
and the nearest home on Central Avenue, and a minimum of approximately 400 feet
between the lights and the nearest home on the west side of Moore Lake. The
distances on both sides increase to 800 -1,000 feet. During the evening, the
residents will see the ambient light from their windows, but they will not see a high
angle beam of light or the bare bulb. The. consultant states that they will see what is
known as "distant visual brightness ", and is confident that there will not be any
interference to the enjoyment of their property.
The lighting consultant also notes that the intensity of the lights is vastly different
from typical commercial uses which abut a residential area. For example, gas
station/convenience stores use brighter lights in the canopy and on the buildings to
illuminate the immediate area. These uses are typically located immediately
adjacent to multiple family or a single family residential area.
4. The HRA was concerned about the range of costs proposed on the light. standards
and why the HRA was responsible for all of the costs. The proposed cost, .based on
the type of fixture chosen, has now been reduced to between $104,000 (Executive_
Shoebox style) to $119,600 (Shepherd's Hook) based on the consultant's analysis.
It is proposed that the costs for the lighting be shared equally between Municipal
State Aid funds and the HRA, or $60,000 each.
ADVANTAGES
1. Installing lights along the causeway, no matter what type of standard, has historical
context in the fact that it was approved during the original intersection improvement
plan in 1987 at a similar cost (approximately $100,000 for the causeway lights).
2. The Highway 65 intersection represents one of the "front doors" of the community.
Reworking the intersection will not only accommodate the increasing traffic on
Highway 65 but will also clean -up and modernize the City's "front yard ".
sE
Highway 65 Street Lights
June 6, 1997
Page 3
During the daytime, the street lights provide another piece of "furniture" to decorate
the entrance into the City. When driving down the causeway, there are several
areas where the guardrails are rusted and broken away. This does not provide a
positive impression of the City. MnDOT should be contacted to repair these
sections of the guardrails. The light standards will be an attractive addition to this
stretch of roadway.
During the evening, the lights may help to improve driving conditions and therefore
may be able to prevent future accidents.
One of the HRA members felt that the additional lights would wash out the reflection
of the moon or other lights in. the area in Moore Lake. Because of the lake's size,
there should not be a total washout of the reflection since the lights will be directed
down toward the pavement.
3. Installing the lights as part of this project is the most opportune time to do so.
Delaying installation until the future will increase costs as a result of not having the
savings of contractor mobilization at the same time work is being completed on the
intersection.
RECOMMENDED STANDARD
After reviewing the five different styles of standards, and after seeing a number of
examples, it is recommended that a black Shepherd's Hook style be installed. This
standard provides the following advantages:
1. The "hook" feature of the standard mimics the decorative light standard already
installed along East. Moore Lake Drive (and in other areas of the City), thereby
providing design continuity.
2. Because the standards are similar in design, the standards "link" the redevelopment
area at East Moore Lake Drive with the Fridley Executive Center site at Highway 65.
3. The design of the fixture is almost a nautical feature which accents Moore Lake.
4. The standard enhances the "identity" of the City and makes a statement that the
City is committed to quality development and improvements.
6F
ti
Highway 65 Street Lights
June 6, 1997
Page 4
RECOMMENDATION
Given the additional information obtained in the last several weeks, staff recommends
that the City Council agree to share the costs of installing the Shepherd's Hook
standard and include the standard as part of the bid specifications for the intersection
design. It is also suggested that the City Council and the HRA share the installation
costs; 50% to come from Municipal State Aid Funds and 50% from the HRA. It is
anticipated that the annual electric charge to the City would be approximately $6,000 -
$7,000 per year.
BD /dw
M -97 -267
6G
HOUSING & REDEVELOPMENT AUTHORITY fffETING, FEBRUARY 12, 1987 PAGE 16
Mr. Rasmussen asked if the HRA should be doing any kind of PR regarding this
impending lawsuit to protect their interests.
Mr. Newman stated the subject was raised at the last City Council meeting
about whether the City and the HRA should go on the offense and issue their
own press release.
(Mr. Prairie left the meeting at 10:15 p.m.)
Ms. Schnabel stated if people are--concerned about what is going on with that
property and rumours are flying around, maybe there was a need for some type
of press release and maybe Staff should start preparing for an article.
Mr. Newman stated he would caution the HRA members that if they do get.served
with any legal pavers that they note the date and the time and forward the
papers to him immediately. If any of the HRA members feel the need for
any further.discussion, he /she should let fir. Robertson know and they will
schedule a meeting.
Ms. Schnabel stated she would like to know whenever any of the HRA members
was served with papers, because she felt that was something the other members
should be aware of right away.
5. CONSIDERATION OF A RESOLUTION (1) REQUESTING THAT THE FRIDLEY CITY COUNCIL
Mr. Robertson stated this project was originally started to improve the easterly
entrance to the Lake Pointe project. As the HRA remembered, it was the project
that was required to, not only improve the entrance visually and .functionally,
but was also required by the Indirect Source Air Quality Permit.to- expedite
the traffic flow to reduce the air pollution.
Mr. Robertson stated the basic cost was not to exceed $1,661,784.40; however,
there were some additional costs the HRA might wish to consider in the future
on decorative lighting. He would also-call the HRA's attention to the memo given
to the HRA members regarding an informational meeting that was held the pre-
vious evening at City Hall with the people who own homes along Old Central Ave.
beyond the intersection.
Mr. Robertson stated tor. Flora was at the meeting to give some technical
background.
Mr. Flora stated that since the public hearing with the residents along Old
Central, there was some question about whether this was actually an acceptable
solution to the intersection at this time. So, they are working on some
alternative solutions to satisfy some of the concerns of the neighborhood, but
they were still looking at somewhere around $1.7 million for this intersection
improvement which was designed to handle the Lake Pointe Development, Highway
65, and the future traffic upstream and downstream from the intersection.
6H
HOUSING & REDEVELOPMENT AUTHORITY IIEETI14G FEBRUARY 12, 1987 PAGE 17
Nr. Flora stated that if the project goes. Staff has some suggestions. As
the HRA knew, they were doing a University Ave. Corridor study & in that study, the;
were looking at the "Fridley look ", certain light fixtures, plantings,
etc. If this was to be the Fridley look, the question was should the Fridley
look be continued to this location also.
at incorporating those types of lights If they do that, they should look
g
So, depending on the options, they were lookinggat atrangenof $4,000otoct.
$155,000 for the Fridley street lighting look.
Mr. Flora stated another item, with the Indirect Source Permit, was the Rice
Creek Road diversion. Part of that plan was that too many cars were coning
down Old Central to the Highway 65 /Old Central intersection, so the plan was
to divert the traffic from Old Central to Highway 65 through Rice Creek Road
by the Shorewood Shopping Center. That was another project that was
authorized by the HRA for preliminary plans to be prepared. At the informational
meeting with the neighborhood, the neighbors felt this was probably the first
priority because by moving the traffic off Old Central at the Old Central/ Rice
Creek Road intersection, some of the concerns could be resolved more satis-
factorily. So, Staff might be coming to the HRA to do this. Right now in
round numbers, that improvement would be $400,000. Staff was also looking
at whether they should also continue the Fridley look in this location if they do
it at the Highway 65/Old Central location. These were things the HRA would have to
decide.
Mr. Flora stated the item before the HRA at this meeting was the intersection.
Per the agreement with Mr. Weir.-and the HRA and the City was supposed. to work to
get this intersection done this construction season. The City was moving
forward, but they needed some approval from the HRA.
Councilperson Schneider stated he did not know if the City Council would hold
a public hearing or not, but he would be more comfortable if this resolution
came to the City Council without the HRA specifically requesting the City
Council not to hold a public hearing.
Mr. Qureshi stated there was no legal requirement to hold a public hearing,
but certainly the HRA or the City Council could hold a public hearing if they
wished. The HRA could delete that wording from the resolution.
Mr. Flora stated he would also like some kind of concensus from the HRA so
they can tell the consultant he can put the lighting into the plan so they
can be identified and the costs provided rather than doing it later. This
was certainly going to be another one of the focal points of the City.
Ms. Schnabel stated her problem was that as far as she knew the HRA had not
made any decision yet on the lighting along University Ave.
Mr. Robertson stated the HRA did approve the lighting at the intersections,
but not along the Corridor. After Staff received the recommendations-frnm
the Barton- Aschmann firm, staff did recommend a style of lighting standards.
It was
61
HOUSING & REDEVELOPMENT AUTHORITY MEETING, FEBRUARY 12, 1987 PAGE 18
his understanding that when the HRA approved the Staff report in December,
they approved that style of 1ightinq_ standards for the intersection. The
RRA_then hired Mr. Ellers, a former NSP lighting engineer, to specify the
lighting details, not only for the intersections, but for the entire corridor
to make sure all the lighting fit so they wouldn't have to redo the intersections
to match the corridor at some later time. They now have a design and layout
for the entire University Ave. corridor for the approved lighting style plus
preliminary recommendations for the commercial frontage road lighting. They
have not yet brought this to the HRA.
Mr. Robertson stated they were now beginning preliminary engineering designs
for Old Central'-and Highway 65 /Lake Pointe Drive entrap ice. Did
the HRA wish to make a commitment at this time to adopt those styles of lighting
standards for this intersection also?
MOTION BY IYR. RASMUSSEN, SECONDED BY MR. MEYER, TO ADOPT RESOLUTION NO.
HRA 2 -1987, DELETING THE LANGUAGE,. "AND WAIVE THE PUBLIC HEARING RELATING
THERETO ".
UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCHNABEL DECLARED THE
MOTION CARRIED UNANIMOUSLY.
The HRA members agreed Staff could proceed to incorporate the lighting design
into the plan all the way to Rice Creek Road, but that the HRA would like to
see all the plans before it is approved.
6. CLAIMS (1565- 1581):
MOTION BY MR. RASMUSSEN, SECONDED BY MR. MEYER, TO APPROVE THE CHECK
REGISTER AS PRESENTED.
UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCHNABEL DECLARED THE
MOTION CARRIED UNANIMOUSLY.
7. OTHER BUSINESS:
a. Update on Mississippi St. Intersection
Mr. Qureshi stated the intersection plans have been prepared. The
County originally had plans to do the East River Road /Rice Creek Bridge,
but they ran into some technical difficulties. Since the Mississippi Street
plans are ready, the County wishes to proceed on it this year if
possible. This plan was presented to the City Council and the members
of the City Council had some concerns. They recognized the improvements
would help move the traffic through the intersection, but their concern
was to make sure the neighborhood behind Holly Center still had access
to this road and be able to use it safely. The City Council requested
the County to look at the possibilities of providing some control of
the intersection in this location. The City received a letter from the
County stating that when this. development comes and they can identify a
cross intersection either at 2nd Street or.at the westerly entrance to the
Holly Shopping Cefiter, they will assist in providing a signal at that
4odation.' With that commitment, he felt.the City Council would be amiable
to the County proceeding with the project.
6J
' F DIRECTORATE
OF
PUBLIC WORKS
C11YOF MEMORAND -UM
HUDLLY
FROM: John G. Flora, Public Works Director
rATE: February 9, 1987
SUBJECT: Highway 65/100 Ztain Drive -In
i
With the development of the final plans for the improvement of Highway 65
and Lake Fbinte and Old Central intersection in support of the Woodbridge
Lake Pointe Development, our Consultant (S. E. H. ) has identif ied an
estimated cost of $1.7 million dollars as compared to my estimate of $1.6
million dollars.
With the development of the University Avenue Corridor Study, we have been
investigating the installation of Highway shoulder lights consisting of
40 -foot sharp - angled brown poles with box -type light fixtures and f rontage
road lights consisting of 14 -foot brown poles with two light box -type light
f ixtures pe r pol e.
where has been considerable discussion on extending the University Avenue
Corridor theme to the other major roads within the City. Accordingly, I
have prepared an estimate for incorporating the Univeristy Corridor
lighting system into the Highway 65 project.
I. Converting the existing lights in the project
to the 'corridor standard (7 each) . . . . . . . . . .$ 4,000.00
2. Installing highway lights through the
Highway 65 improvement,(2,3001) . . . . . . . . . . .$ 50,000.00
3. Extending the Highway 65 lights north to West
Moore Lake Drive (2,0001) . . . . . . . . .$ 50,000.00
4. Installing frontage road lights on Old Central
the length of the project on one side
only (1,1001) . . . . . . . . . . . . . . . . . . .$ 31,000.00
5. Extending frontage toad lights along Lake
Fbinte Drive with lights on two sides
within the project (3001) . . . . . . . . . . . . .$ 20,000.00
Installing the University Avenue Corridor standard highway and frontage
lights within the project would result in an additional cost of
approximately $105,000.0.. If it was desired to extened the lighting systerr.
across the entire Moore Lake causeway, the cost wc::*d be $155,000.00.
/ /'w- `17
It would be appropriate at this time for the HRA .to determine if they
desire to incorporate the City light scheme into the Highway 65 improvement
project and if so, to what extent, so that we may inform S. E. H. to ir,cl uae
the proper quantities in the specifications and contract documents.
Request guidance on how we should proceed with the Highway 65 improvement
proj ect.
'TcFits 6K
c.
With the development of the final plans for the improvement of Highway 65
and Lake Fbinte and Old Central intersection in support of the Woodbridge
Lake Pointe Development, our Consultant (S. E. H. ) has identif ied an
estimated cost of $1.7 million dollars as compared to my estimate of $1.6
million dollars.
With the development of the University Avenue Corridor Study, we have been
investigating the installation of Highway shoulder lights consisting of
40 -foot sharp - angled brown poles with box -type light fixtures and f rontage
road lights consisting of 14 -foot brown poles with two light box -type light
f ixtures pe r pol e.
where has been considerable discussion on extending the University Avenue
Corridor theme to the other major roads within the City. Accordingly, I
have prepared an estimate for incorporating the Univeristy Corridor
lighting system into the Highway 65 project.
I. Converting the existing lights in the project
to the 'corridor standard (7 each) . . . . . . . . . .$ 4,000.00
2. Installing highway lights through the
Highway 65 improvement,(2,3001) . . . . . . . . . . .$ 50,000.00
3. Extending the Highway 65 lights north to West
Moore Lake Drive (2,0001) . . . . . . . . .$ 50,000.00
4. Installing frontage road lights on Old Central
the length of the project on one side
only (1,1001) . . . . . . . . . . . . . . . . . . .$ 31,000.00
5. Extending frontage toad lights along Lake
Fbinte Drive with lights on two sides
within the project (3001) . . . . . . . . . . . . .$ 20,000.00
Installing the University Avenue Corridor standard highway and frontage
lights within the project would result in an additional cost of
approximately $105,000.0.. If it was desired to extened the lighting systerr.
across the entire Moore Lake causeway, the cost wc::*d be $155,000.00.
/ /'w- `17
It would be appropriate at this time for the HRA .to determine if they
desire to incorporate the City light scheme into the Highway 65 improvement
project and if so, to what extent, so that we may inform S. E. H. to ir,cl uae
the proper quantities in the specifications and contract documents.
Request guidance on how we should proceed with the Highway 65 improvement
proj ect.
'TcFits 6K
MEMORANDUM
HOUSING
REDEVELOPMENT
AUTHORITY
DATE: June 6, 1997
TO: William Bums, Executive Director of HRA ?"
FROM: Barbara Dacy, Community Development Director
Grant Femelius, Housing Coordinator
SUBJECT: Update on Housing Replacement Program
Staff is currently evaluating several changes to the housing replacement program. Our
intent is to improve the price received for the vacant lots and encourage better home
designs. As you recall, the HRA previously sold lots to the highest bidder and then
executed a development contract with the buyer to construct a home. Of the 12 sites
sold to date (11 homes were actually built), 10 were purchased by builders and 1 by an
individual.
In all cases the builders constructed the homes as originally proposed and for the most
part on time. In some cases extensions were granted to allow for more time to
construct the home. The homes are clearly an improvement to the neighborhoods and
will help to encourage additional private- sector investment.
Despite these accomplishments, we are somewhat disappointed with the lot sale prices
and the lack of different house designs. Most of the houses built to date have been the
same split -entry design.
What we have learned from the builders is that our current system forces them to build
homes on a speculative basis. Because of the inherent risk in building on spec, the
builders discount the price they are willing to pay for the land. Furthermore, the house
designs are relatively simple, low -cost and attractive to first-time buyers. We
acknowledge that this is a new program in Fridley and the original goal of replacing
substandard housing is working, however we believe we can do better.
The City of Richfield, which we have tried to model our program after, uses a system
which seems to strike a balance between good house design/higher lot
7
Update on Housing Replacement Program
June 6, 1997
Page 2
price and acceptable builder risk. Richfield establishes both the lot price and minimum
house price up front and then allows builders to reserve the lot for a specified period of
time. During this interim period, the builder will market the lot (usually through a realtor)
and once a buyer is found, executes a development agreement. Only buyer /builder
teams are allowed to purchase sites.
The advantage to the Richfield approach is that the builder is not forced to build a home
on spec. Instead, they have the ability to exclusively market a site and find an eligible
buyer. The buyer knows that the minimum requirements and can decide whether they
want to move forward. Once an offer is made, the City approves the package
(including house design) at the same time the development agreement is approved: A
copy of the Richfield Rediscovered Program is attached.
We are continuing to evaluate the Richfield approach and plan to make a
recommendation to the HRA at their July meeting. Our intent would be to make the
HRA's existing lot inventory available for sale by August 1997. No action is needed by
the HRA at this time.
GF/
W97 -270
[L!
City of Fridley
Community Development Department
MEMORANDUM
DATE: May 27, 1997
P
TO: William Bums, City Managerg�
FROM: Barbara Dacy, Community Development Director
Grant Femelius, Housing Coordinator
SUBJECT: Housing Replacement Program Acquisition Policy
In response to the issues raised at the May 8t' HRA meeting, staff has drafted a
proposed policy for future scattered site acquisitions. A summary of the policy
and implementation plan is attached.
Briefly, the policy outlines the scenarios in which it is appropriate to use the
City's authority to raze a home deemed to be hazardous, and when it is
appropriate to acquire a substandard home under the scattered site program.
As a first step, staff will develop a list of all homes built before 1960 and conduct
an exterior survey. From this survey, the list will be broken down further to
identify sites which are severely. deteriorated. Additional analysis will be required
to determine the following:
1. Whether the home is vacant or abandoned.
2. The property's current market value.
3. The potential to redevelop the site for a residential use.
4. The degree or severity of deterioration.
Staff is recommending that use of the hazardous building statutes be limited to
the most distressed housing that 1) cannot be redeveloped, and 2) is vacant or
abandoned. The Housing Replacement Program should continue to be used to
acquire substandard housing on a voluntary basis.
Unless otherwise directed, staff will use this policy for all future acquisition
activity. Please let us know if you have any questions.
M -97 -249
`A •
Housing Replacement Program
Acquisition Policy
I. OPTIONS
1) HAZARDOUS BUILDING ABATEMENT
This model would be used to require the repair or removal of a
hazardous house. The property owner must be given the
opportunity to take action on their own, however, if they fail to do so
the City would be required to go to court to enforce its order. If
upheld in court, the City could then proceed with the repair or
demolition and assess the costs against the property.
Because of the difficulty, expense and public sensitivity in pursuing
these types of cases, the practical application of the hazardous
building statutes should be limited to the following:
A hazardous house which is vacant or abandoned and
located on a site which could not be redeveloped (i.e.
unbuildable lot).
A hazardous house which is vacant or abandoned and
located on a site which could be redeveloped, but the
acquisition costs are too high or the site is not a
redevelopment priority.
2) HOUSING REPLACEMENT PROGRAM
This model would be used to carryout the voluntary acquisition and
removal of a substandard house. With respect to non- buildable
lots, up to four (4) contiguous sites could be acquired under the
program. Projects involving the acquisition of five (5) or more.
contiguous, non - buildable lots could be evaluated for inclusion in a
redevelopment tax increment district. Once acquired, the site /s
would be cleared and offered for redevelopment.
Scenarios in which this approach could be used are as follows:
A substandard house which is occupied and located on
either a buildable or non - buildable lot.
Owner is willing to sell.
The cost to acquire the site falls within the HRH's negotiation
guidelines.
00
II. IMPLEMENTATION
1)
2)
SCREENING PROCESS
a) Identify all properties built before 1960 and screen for the
lowest valued homes.
b) Examine exterior of these properties to evaluate condition.
c) Identify whether house is located on a buildable lot or
unbuildable lot.
d) Cross -check list of homes with code enforcement case
history.
EVALUATION PROCESS
a) No action is needed for sites on the list which contain a
home in good condition.
b) Sites which contain a home in fair condition which is still
suitable for occupancy will be mailed information on housing
rehabilitation programs.
c) Sites which contain a hazardous house which is vacant or
abandoned home will be evaluated for the abatement
process using the hazardous building statutes.
d) Sites which contain a substandard home will be evaluated
for the Housing Replacement Program. Factors to be
considered in choosing a site to acquire:
i.) Whether the site meets the definition of
"substandard" as required by law.
ii.) Whether the site contains a buildable lot. In addition,
it will be necessary to look at the current zoning and
determine whether a residential use is appropriate.
iii.) The cost to acquire the property.
Sites which meet the above tests will be prioritized for
potential acquisition. Staff will contact each owner to
determine their interest in selling, if successful, inspect each
property and have the house appraised. The final purchase
would be presented for HRA approval.
MEMORANDUM[
HOUSING
REDEVELOPMENT
DATE: June 6, 1997
AUTHORITY
TO: William Bums, Executive Director of HRA
9
FROM: Barbara Dacy, Community Development Director
SUBJECT: Linn Redevelopment Project Update
A copy of the development contract is included in the HRA packet. Since approval of
the resolution authorizing execution of the development agreement, Jim Casseriy met
with the developer on several occasions and then drafted the agreement. The
Chairperson and the Executive Director have reviewed and approved the concepts
contained in the agreement. The agreement provides for the following:
1. The Authority will agree to issue a Limited. Revenue Note in the amount of $175,000
(present value) when both parts of the project are completed. The agreement
provides for a completion date for the Goodyear Service Center by December 31,
1997 and for the retail center by December 31, 1999. Certificates of Completion for
both buildings must be issued prior to the Authority beginning payment on the note.
2. The agreement provides an incentive for the developer to own the project as long as
possible so that all of the tax increment can be received by the developer. If the
Goodyear Service Center is sold, the agreement provides that one half of the
principal of the note is deemed to be paid in full; therefore, the developer would not
receive one half of the revenue note (this requirement does not pertain to the retail
center). If the developer does not sell the building prior to the revenue note expiring
in 2012, the developer must pay the Authority $50,000 in a lump sum or based upon
terms contained in the agreement. If the building is sold prior to 2012, the developer
must pay one half of the principal amount already paid on the note, up to $50,000.
By the time of the HRA meeting, the developer will probably have closed on the -
property. It is also anticipated that the building permit for remodeling the service center
will be obtained this month.
41
Linn Redevelopment Project Update
June 6, 1997
Page 2
No action is needed by the HRA.
BD /dw
M -97 -275
90
MEMORANDUM
HOUSING
REDEVELOPMENT
DATE: June 6, 1997
AUTHORITY
TO: William Bums, Executive Director of HRA 44 l
FROM: Barbara Dacy, Community Development Director
SUBJECT: Repair on Bridgewater Drive
The Engineering Department has found a 200' - 300' section of Bridgewater Drive
which is badly cracked and broken up. The current pavement consists of a two inch
base course over a Class 5 granular base. The final layer of pavement has been
delayed on Bridgewater Drive or Lakepointe Drive until the property develops. The
base course, however, has lasted approximately 10 years.. The estimate received by
the Engineering" Department to repair area is estimated to be approximately $4,000.
No action is needed by the HRA on this item. The Engineering Department will proceed
with the minor repair.
BD /dw
M -97 -259
.A
MEMORANDUM
HOUSING
AND
REDEVELOPMENT
AUTHORITY
DATE: June 6, 1997
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Update on 1s' Time Home Buyer Program
The Anoka County HRA has completed their bond sale to fund a. first -time
homebuyer program. The County is currently in the process of finalizing
arrangements with local lenders to participate in the program and process
mortgages. Eligible, first -time homebuyers have the ability of accessing the
County's funds on first -come, first -serve basis. No specific allocation has been
set aside for individual cities in the County.
The program has the following features:
1. $3,060,000 is set aside for purchase -only transactions.
2. $1,020,000 is reserved for purchase -rehab transactions. A minimum of
$5,000 worth of rehab is required to qualify.
3. Borrower's have the option of a 7.20% rate mortgage or 7.40% with down
payment assistance up to 2% of the mortgage. The down payment
assistance is issued in the form of a deferred - second due upon sale or after
15 years, whichever comes first.
To qualify for the program borrowers must have an adjusted gross income less
than $45,840, plan to buy a home for less than $95,000, have good credit and
be a first -time buyer.
r �
1' Time Home Buyer Memo
June 5, 1997
Page 2
The program will be available until June 1, 1998 or earlier if the funds are
expended. Staff will work locally to promote the program and refer interested
buyers to participating lenders.
GF/
M -97 -269
Fridley HRA
Loan Program Summary
May 1997
Cry Wide Loans
Hyde Park Loans
Date
Date
Type of
Name
Address
Closed
Amount
Closed
Property
1 Moses
5180 Hughes Ave.
$
12,922
117/97
Single - Family
2 King
375 67th Ave. NE
$
11,306
1/28/97
Single - Family
3 Larson
6130 6th St NE
$
4,670
2/25197
Single - Family
4 Diedrich
46 66th Way N£
$
8,375
3111/97
Single - Family
5 Elverud
221 Rice Creek Terr.
$
4,839
3/12197
Single- Family
6 Zebra
6589 Clover Place
$
11,039
4/7/97
Single - Family
7 Westinfield
81 Rice Creek Way
$
25,000
4/8/97
Single- Family
8 Setering
71 66th Way NE
$
10,000
418197
Single - Family
9 Doherty
7315 East River Rd.
$
3,474
4/8/97
Single - Family
10 Westby
1467 Onondaga St.
$
10,000
4/22197
Single - Family
11 Mac iej
6400 Starfde Blvd.
$
9,500
4/29/97
Single - Family
12 Anderson
6800 Oakley St
$
7,500
4129/97
Single - Family
13 Olson
1442 64th Ave.
$
2,700
4129/97
Single - Family
14 Maile
6218 Carol Circle
$
2,000
516/97
Single - Family
15 Butler
5948 7th St NE
$
16,814
516197
Single - Family
16 Allard
516 54th Ave.
$
7,239
5/6/97
Single -Family
17 Warner
6930 Hickory Dr.
$
4,859
517197
Single - Family
18 Englebretson
1643 Gardena Ave.
$
3,800
5/13/97
Single- Family
19 Hart
861 Pandora Drive
$
13,200
5/13/97
Single- Family
20 Varcoe
974 Rice Creek Terrace
$
4,860
5/19/97
Single- Family
21 Miller
525 Bennett Drive
$
3,750
5/27/97
Single - Family
22 Larson
359 66th Avenue NE
$
10,380
5/27/97
Single - Family
22
Sub -Total
$ 188,227
Hyde Park Loans
Installment Loans
Existing Installment Loans Being Serviced by CRF 113
Principal Balance at Beginning of Month $ 1,476,471.39
Principal and Interest Payments Received $ 20,532.88
CRF Servicing Fees $ 568.50
Principal Balance at End of Month $ 1,462,012.48
Delinquencies -
Defaults -
II Deferred Loans
Existing Deferred Loans Being Serviced by CRF 7
Principal Balance at Beginning of Month $ 53,994.00
Principal and Interest Payments Received $ -
CRF Servicing Fees $ -
Principai Balance at End of Month $ 53,994.00
1997 LOAN ACTWITY REPORT
Date
Type of
Name
Address
Amount
Closed
Properly
1 Anderson
6061-65 3rd St NE
$ 6,621
1128/97
Duplex
2 Monson
6046 2 -1/2 St NE
$ 2,235
411/97
Single - Family,
3 Rocek
5791 2 -1/2 St NE
$ 1,837
418197
Single - Family,
3
Sub -Total
$ 10,693
25 Loans
Value
$198,920
End of April 1997
Installment Loans
Existing Installment Loans Being Serviced by CRF 113
Principal Balance at Beginning of Month $ 1,476,471.39
Principal and Interest Payments Received $ 20,532.88
CRF Servicing Fees $ 568.50
Principal Balance at End of Month $ 1,462,012.48
Delinquencies -
Defaults -
II Deferred Loans
Existing Deferred Loans Being Serviced by CRF 7
Principal Balance at Beginning of Month $ 53,994.00
Principal and Interest Payments Received $ -
CRF Servicing Fees $ -
Principai Balance at End of Month $ 53,994.00
1997 LOAN ACTWITY REPORT
Draft: June 4, 1997
CONTRACT
FOR
PRIVATE REDEVELOPMENT
By and Between
Blacklined to Draft
of May 19, 1997
THE HOUSING AND REDEVELOPMENT AUTHORITY
In and For
THE CITY OF FRIDLEY, MINNESOTA
LINN PROPERTY HOLDINGS, L.L.C.
This Instrument Drafted By:
KRASS MONROE, P.A.
Suite 1100 Southpoint Office Center
1650 West 82nd Street
Bloomington, MN 55431
612/885 -5999
James R. Casserly, Esq.
TABLE OF CONTENTS
Pacte
ARTICLE I
Definitions
Section 1.1. Definitions 3
ARTICLE II
Representations and Warranties
Section 2.1. Representations by the Authority 6
Section 2.2. Representations and Warranties by the
Redeveloper 6
ARTICLE III
Site Improvements;
Undertakings of Authority and Redeveloper
Section 3.1. - Construction of Site Improvements 9
Section 3.2. Reimbursement for Site Improvements 9
Section 3.3 Repayment 9
ARTICLE IV
Construction of Minimum Improvements
Section
4.1.
Construction of Minimum Improvements
10
Section
4.2.
Construction Plans
10
Section
4.3.
Completion of Construction
11
Section
4.4.
Certificate of Completion
11
ARTICLE V
Tax Increment
Section 5.1. Tax Increment Certification 13
ARTICLE VI
Prohibitions Against Assignment and Transfer; Indemnification
Section
6.1.
Representation as to Redevelopment
14
Section
6.2.
Prohibition Against Transfer of
Property and Assignment of Agreement
14
Section
6.3.
Release and Indemnification Covenants
15
Section
6.4
Subordination
15
ARTICLE VII
Events of Default
Section
7.1.
Events of Default Defined
16
Section
7.2.
Remedies on Default
17
Section
7.3.
No Remedy Exclusive
17
Section
7.4.
No Additional Waiver Implied by One Waiver
17
Section
7.5.
Agreement to Pay Attorney's Fees
20
Section
8.6.
and Expenses
17
ARTICLE VIII
Additional Provisions
Section 8.1. Conflict of Interest; Authority
ARTICLE IX
Termination of Agreement; Expiration
Section 9.1. Termination 21
Section 9.2. Sections to Survive Termination 21
SIGNATURES 22
SCHEDULE
A
Representatives Not Individually Liable
19
Section
8.2.
Equal Employment Opportunity
19
Section
8.3.
Titles of Articles and Sections
19
Section
8.4.
Notices and Demands
19
Section
8.5.
Counterparts
20
Section
8.6.
Time of the Essence
20
Section
8.7
Future Development
20
ARTICLE IX
Termination of Agreement; Expiration
Section 9.1. Termination 21
Section 9.2. Sections to Survive Termination 21
SIGNATURES 22
SCHEDULE
A
Description of Redevelopment Property
Located in Ramsey County, Minnesota
24
SCHEDULE
B
Certificate of Completion
25
SCHEDULE
C
Note
27
SCHEDULE
D
Quality Enhancements
31
SCHEDULE
E
Site Improvements
32
SCHEDULE
F
Minnesota Business Assistance Form
33
SCHEDULE
G
Site Plan
34
SCHEDULE
H
Authority Mortgage
35
CONTRACT FOR PRIVATE REDEVELOPMENT
THIS AGREEMENT, made on
1997 by and between the Hous
and for the City of Fridley,
political subdivision of the
the Constitution and laws of
Property Holdings, L.L.C., a
"Redeveloper "),
WITNESSETH:
or as of the day of ,
ing and Redevelopment Authority in
Minnesota (the "Authority "), a
State of Minnesota organized under
the State of Minnesota and Linn
limited liability company (the
WHEREAS, the Board of Commissioners (the "Board ") of the
Authority has determined that there is a need for development and
redevelopment within the corporate limits of the City to provide
employment opportunities, to,provide adequate housing in the
City, including low and moderate income housing and housing for
the elderly, to improve the tax base and to improve the general
economy of the City and the State of Minnesota;
WHEREAS, in-furtherance of these objectives, the Authority
has adopted, pursuant to Minnesota Statutes, Sections 469.001 et
seq. (the "Act "), a development program known as the Modified
Redevelopment Plan (the "Redevelopment Plan ") and established
Redevelopment -Project No. 1 (the "Project Area ") in the City to
encourage and provide maximum opportunity for private development
and redevelopment of certain property in the City which is not
now in its highest and best use;
WHEREAS, major objectives in establishing the Project Area
are to:
1. Promote and secure the prompt redevelopment of certain
property in the Project Area, which property is not now in its
highest and best use in a manner consistent with the City's
Comprehensive Plan and with a minimum adverse impact on the
environment, and thereby promote and secure the redevelopment of
other land in the City.
2. Provide additional employment opportunities within the
Project Area and the City for residents of the City and the
surrounding area, thereby improving living standards, reducing
unemployment and the loss of skilled and unskilled labor and
other human resources in the City.
3. Prevent the deterioration and secure the increase of
commercial /industrial property subject to taxation by the City,
the Independent School Districts, Anoka County, and the other
taxing jurisdictions in order to better enable such entities to
pay for governmental services and programs required to be
provided by them.
4. Provide for the financing and construction for public
improvements in and adjacent to the Project Area necessary for
the orderly and beneficial redevelopment of the Project Area and
adjacent areas of the City.
5. Promote the concentration of new desirable industrial,
office, and other appropriate redevelopment in the Project Area
so as to maintain the area in a manner compatible with its
accessibility and prominence in the City.
6. Encourage local business expansion, improvement, and
redevelopment, whenever possible.
7. Create a desirable and unique character within the
Project Area through quality land use alternatives and design
quality in new or remodeled buildings.
8. Encourage and provide maximum opportunity for private
redevelopment of existing areas and structures which are
compatible with the Project Area; and
WHEREAS, in order to achieve the objectives of the Authority
and City in creating the Project Area the Authority is prepared
to assist the Redeveloper with the costs of the Site Improvements
in accordance with this Agreement; and
WHEREAS, the Authority believes that the development -and
redevelopment of the Redevelopment Property pursuant to this
Agreement, and fulfillment generally of the terms of this
Agreement, are in the vital and best interests of the Authority
and the health, safety, morals and welfare of its residents, and
in accord with the public purposes and provisions of applicable
federal, state and local laws under which the development and
redevelopment are being undertaken and assisted;
NOW, THEREFORE, in consideration of the premises and the
mutual obligations of the parties hereto, each of them does
hereby covenant and agree with the other as follows:
K
ARTICLE I
Definitions
Section 1.1. Definitions. In this Agreement, unless a
different meaning clearly appears from the context:
"Act" means Minnesota Statutes, Sections 469.01 et seq.
"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.
"Authority Mortgage" means a mortgage which is secured by
the Redevelopment Property, their form of which is attached hereto
as Schedule H.
"Available Revenue" means the greater of: (a) 800 of the Tax
Increment from the Tax Increment District plus the contributions
required by the City making an election as provided in Minnesota
Statutes, Section 273.1399; or (b) 90% of the Tax Increment.
"Certificate of Completion" means the certification, in the
form of the certificate contained in Schedule B attached to and
made a part of this Agreement, provided to the Redeveloper,
pursuant to Section 4.4. of this Agreement.
"City" means the City of Fridley, Minnesota.
"Construction Plans" means the plans, specifications, drawings
and related documents on the construction work to be performed by
the Redeveloper on the Redevelopment Property which (a) shall be as
detailed as the plans, specifications, drawings and related
documents which are submitted to the building official of the City,
with an application for a building permit for the Minimum
Improvements and (b) shall include at least the following for each
building: (1) site plan; (2) foundation plan; (3) floor plan for
each floor; (4) elevations (all sides); (5) facade and landscape
plan; and (6) such other plans or supplements to the foregoing
plans as the City may reasonably request.
"Council" means the City Council, the governing body of the
City.
"County" means the County of Anoka, Minnesota.
"Event of Default" means any Event of Default described in
Section 7.1 of this Agreement.
3
"Minimum Improvements" means the improvements to the
Redevelopment Property, including landscaping, parking and
related facilities, to be constructed by the Redeveloper upon the
Redevelopment Property pursuant to this Agreement; the Minimum
Improvements shall consist of a new retail center consisting of
approximately 7,980 square feet the "Retail Center Minimum
Improvement ") and the remodeling and rehabilitation of the
existing service center of approximately 8,640 square feet JLhe
"Service Center Minimum Improvements "). The Minimum
Improvements include the retail center enhancements described on
Schedule D of this Agreement, and the Minimum Improvements are
further described on the Site Plan attached as Schedule G to this
Agreement.
"Minnesota Critical Areas Act" means the statutes located at
Minnesota Statutes, Section 116G.01 et seq., as amended.
"Minnesota Environmental Policy Act" means the statutes
located at Minnesota Statutes, Sections 116D.01 et seq., as
amended.
"Minnesota Environmental Rights Act" means the statutes
located at Minnesota Statutes, Sections 116B.01 et seq., as
amended.
"National Environmental Policy Act" means the federal law
located at 42 U.S.C. Sub. Sect. 4331 et seq., as amended.
"Note" means the Limited Revenue Tax Increment Note of 1997
attached as Schedule C. The Note shall be payable from Available
Revenue.
"Project" means the Redevelopment Property and the Minimum
Improvements.
"Project Area" means Redevelopment Project No. 1, as
amended, established in accordance with the Act.
"Redeveloper" means Linn Property Holdings, L.L.C., a
Minnesota limited liability company, and its successors or
assigns.
"Redevelopment Plan" means the modified redevelopment plan
adopted by the Authority for its Project Area, as amended.
"Redevelopment Property" means the real property upon which
the Minimum Improvements are to be constructed, which real
property is described on Schedule A of this Agreement.
"Site Improvements" means those improvements, with their
itemized costs, described on Schedule E and which are qualified
improvements to the Redevelopment Property.
4
"State" means the State of Minnesota.
"Tax Increment" means only that portion of the real estate
taxes paid with respect to the Redevelopment Property which is
remitted to the City as tax increment pursuant to the Tax
Increment Act.
"Tax Increment Act" means the Tax Increment Financing Act,
Minnesota Statutes, Sections 469.174 to 469.179, as amended and
as it may be amended.
"Tax Increment District" means Tax Increment Financing
District No. 16 created by the Council within the Project Area
through its adoption of a tax increment financing plan pursuant
to the Tax Increment Act.
"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, outside the reasonable
control of the Party claiming its occurrence, which are the
direct result of strikes, other labor troubles, acts of third
parties, unforeseen environmental issues and soil conditions,
labor and /or material shortages, unusually severe adverse
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
(including the City) which directly result in delays.
5
ARTICLE II
Representations and Warranties
Section 2.1. Representations by the Authority. The
Authority makes the following representations as the basis for
the undertaking on its part herein contained:
(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 has created, adopted and approved the
Redevelopment Plan in accordance with the terms of the Act.
(c) The Authority has created, adopted and approved the Tax
Increment District pursuant to the Tax Increment Act.
(d) The Authority proposes to reimburse the Redeveloper for
the qualified tax increment eligible costs, which will
principally be the Site Improvements.
(e) The Authority will cooperate with the Redeveloper with
respect to any-litigation commenced by third parties in
connection with this Agreement.
(f) The Authority makes no representation, guarantee, or
warranty, either express or implied, and hereby assumes no
responsibility or liability as to the Redevelopment Property or
its condition (whether regarding soils, pollutants, hazardous
wastes or otherwise) or that the Redevelopment Property shall be
suitable for the Redeveloper's purposes or needs.
Section 2.2. Representations and Warranties by the
Redeveloper. The Redeveloper represents and warrants that:
(a) As of the date of execution of this Agreement, the
Redeveloper has received no written notice or written
communication from any local, state or federal official that the
activities of the Redeveloper or the Authority in the Tax
Increment District may be or will be in violation of any
environmental law or regulation.
(b) The Redeveloper will construct, operate and maintain
the Minimum Improvements upon the Redevelopment Property in
accordance with this Agreement and all applicable local, State
and Federal laws and regulations (including without limitation
environmental, zoning, building code and public health laws and
regulations).
(c) The Redeveloper will obtain all required permits,
licenses and approvals, and will meet, in a timely manner, all
requirements of all applicable local, state and federal laws and
regulations which must be obtained or met before the Minimum
Improvements may be lawfully constructed.
(d) The Redeveloper is a Minnesota limited liability
company 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 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.
(e) The Redeveloper agrees that it will cooperate with the
Authority with respect to any litigation commenced by third
parties in connection with this Agreement.
(f) Whenever any Event of Default occurs and the Authority
shall employ attorneys or incur other expenses for the collection
of payments due or to become due or for the enforcement or
performance or observance of any obligation or agreement on the
part of the Redeveloper under this Agreement, the Redeveloper
agrees that it shall, within ten (10) days of written demand,
accompanied by a written itemization of fees and expenses, by the
Authority, pay to the Authority the reasonable fees of such
attorneys and such other expenses so incurred by the Authority.
(g) The financing arrangements which the Redeveloper has
obtained or will obtain, to finance acquisition or construction
of the Minimum Improvements, together with financing provided by
the Authority pursuant to this Agreement, will be sufficient to
enable the Redeveloper to successfully complete the Minimum
Improvements as contemplated in this Agreement.
(h) The Redeveloper represents that it would not be able to
undertake the Project in the reasonably foreseeable future
without the assistance to be provided by the Authority under this
Agreement.
(i) The Redeveloper represents that the completed Project
is reasonably expected to have a meet vaitte cost of
approximately $959,''99 ^^ $1,550,000 on January 1, 1998 2000. f-&r-
r _ real estate ja .
(j) The construction of the Minimum Improvements, in the
opinion of the Redeveloper, would not reasonably be expected to
occur solely through private investment within the reasonably
foreseeable future without the assistance provided by the
Authority pursuant to this Agreement.
(k) The Authority has provided to the Redeveloper, and the
Redeveloper acknowledges receipt of, a copy of Laws of Minnesota
for 1995, Chapter 224, Section 58, codified as Minnesota
Statutes, Section 116J.991, and entitled "Public Assistance to
Business; Wage and Job Requirements," requiring that within 2
years of receiving the assistance provided pursuant to this
Agreement, which for this purpose shall be deemed to be the 2
year period beginning on the date the Certificate of Completion
is issued in accordance with Section 4.4, the Redeveloper shall
comply with certain jobs and other obligations stated in the
above - mentioned statute. The Redeveloper hereby covenants to
comply with said obligations, and the Parties agree that said
goal level shall be the creation of 8 jobs within the applicable
2 year period. The Redeveloper acknowledges and agrees that, as
required by this statutory provision, failure to meet said goals
will result in an .Event of Default hereunder and in an obligation
of the Redeveloper to repay all of the assistance provided
pursuant to this Agreement. The Redeveloper further agrees that
said jobs shall have an hourly wage of at least 10.00 per hour.
This subparagraph shall not be construed as imposing on the
Redeveloper any obligation beyond the scope and purpose of the
above - mentioned statute to maintain or provide minimum employment
and wage levels. The Redeveloper further agrees to provide to
the Authority in a timely manner, or to the State of Minnesota,
as may be applicable, any information that is reasonably
necessary to comply with the above - mentioned statute and in
particular the information necessary to complete the Minnesota
Business Assistance Form attached as Schedule F to this
Agreement, provided, however, that the Redeveloper's obligation
to provide the information referred to in this sentence shall
terminate once the Redeveloper has achieved the requirements
contained in this Section 2.2(k).
(1) For the construction of the Minimum Improvements the
Redeveloper will pay wages in accordance with the prevailing wage
rate as that term is defined in Ordinance No. 1095 of the City's
Code.
(m) The Redeveloper shall not allow any use or occupancy of
the Project by a "Sexually Orientated Business" as defined in
Ordinance No. 965 of the City's Code.
a
ARTICLE III
Site Improvements;
Undertakings of Authority and Redeveloper
Section 3.1. Construction of Minimum Improvements and Site
Improvements. The Redeveloper shall construct the Minimum
Improvements and Site Improvements on the Redevelopment Property
and will maintain, preserve and keep the Minimum Improvements and
Site Improvements in good repair and condition.
All contracts for construction of the Minimum Improvements
and Site Improvements shall provide that payments for the work
thereunder are the sole obligation of the Redeveloper. Neither
the City nor the Authority shall have any obligation under such
contract.
Section 3.2. Reimbursement for Site Improvements. (a) The
Redeveloper shall pay contractors, subcontractors, and /or
construction managers with whom the Redeveloper has entered into
contracts.
Upon:
1) submission to the Authority of invoices from such
contractors and certifications signed by the Redeveloper's
project architect to the effect that the costs for which payment
was made have been incurred in connection with the Site
Improvements and upon receipt of lien waivers from such
contractors, subcontractors, and /or construction managers, and
2) issuance of the Certificate of Completion pursuant to
Section 4.4 hereof, and
3) execution and recording (at Redeveloper's expense) of the
Authority Mortgage,
then the Authority shall pay as reimbursement for such Site
Improvements and other qualified tax increment eligible costs,
which will principally be the Site Improvements, the total of
such costs by delivery of the Note in accordance with this
Section and Section 4.4.
(b) The maximum amount of reimbursement for the qualified
tax increment costs which will principally be the Site
Improvements can not exceed the principal amount of the Note. In
the event the costs of the Site Improvements are less than the
principal amount of the Note, then the Note principal and
payments shall be reduced accordingly.
Section 3.3 Repayment Amount. Upon the Transfer (as defined
in the Authority Mortgage) of the Redevelopment Property, or any
part thereof, the Redeveloper shall pay the Repayment Amount (as
defined in the Authority Mortgage), if any. Upon the receipt of
the Repayment Amount, the Authority shall deliver a satisfaction,
in recordable form, of the Authority Mortgage.
9
ARTICLE IV
Construction of Minimum Improvements
Section 4.1. Construction of Minimum Improvements. The
Redeveloper agrees that it will construct the Minimum
Improvements on the Redevelopment Property in accordance with
this Agreement and the approved Construction Plans.
Section 4.2. Construction Plans. (a) Prior to the
Redeveloper's commencement of construction of the Minimum
Improvements the Redeveloper shall submit to the Authority
Construction Plans for the Minimum Improvements. The
Construction Plans shall provide for the construction of the
Minimum Improvements and shall be in conformity with this
Agreement and.all applicable state and local laws and
regulations. The Authority shall approve the Construction Plans
in writing if: (i) the Construction Plans conform to the terms
and conditions of this Agreement; (ii) the Construction Plans
conform to all Federal, State and local laws, ordinances, rules
and regulations applicable to the construction of the Minimum
Improvements; (iii) the Construction Plans are adequate to
provide for the construction of the Minimum Improvements; and
(iv) no Event of Default has occurred and is continuing. No
approval by the Authority shall relieve the Redeveloper of the
obligation to comply with the terms of this Agreement. No
approval by the Authority shall constitute a waiver of any Event
of Default. If approval of the Construction Plans is requested
by the Redeveloper in writing at the time of submission, such
Construction Plans shall be deemed approved unless rejected in
writing by the Authority, in whole or in part. Such rejection
shall set forth in detail the reasons therefore, and shall be
made within ten (10) days after the date of their receipt by the
Authority. If the Authority rejects any Construction Plans in
whole or in part, the Redeveloper shall submit new or corrected
Construction Plans within thirty (30) days after written
notification to the Redeveloper of the rejection. The provisions
of this Section relating to approval, rejection and resubmission
of corrected Construction Plans shall continue to apply until the
Construction Plans have been approved by the Authority. The
Authority's approval shall not be unreasonably withheld.
(b) If the Redeveloper desires to make any material change
in the Construction Plans after their approval by the Authority,
then the Redeveloper shall submit the proposed change to the
Authority for its approval. If the Construction Plans, as
modified by the proposed change, conform to the requirements of
this Section 4.2 of this Agreement with respect to such
previously approved Construction Plans, the Authority shall
approve the proposed change and notify the Redeveloper in writing
of its approval. Such change in the Construction Plans shall, in
any event, be deemed approved by the Authority unless rejected,
10
in whole or part, by written notice by the Authority to the
Redeveloper, setting forth in detail the reasons therefore. Such
rejection shall be made within five (5) business days after
receipt of the notice of such change. A material change shall
mean a change which individually, or in aggregate with all prior
changes, affects the cost of the Minimum Improvements by One
Hundred Thousand and 00 /100 Dollars ($100,000) or more.
Section 4.3. Completion of Construction. (a) Subject to
Unavoidable Delays, the Redeveloper shall have substantially
completed the construction of the Service Center Minimum
Improvements by December 31, 1997 and the Retail Cep Mine
Improvements ky December 31-, 1999. All work with respect to the
Minimum Improvements to be constructed or provided by the
Redeveloper on the Redevelopment Property shall be in substantial
conformity in all respects with the Construction Plans as
submitted by the Redeveloper and approved by the Authority.
(b) The Redeveloper agrees for itself, its successors and
assigns, and every successor in interest to the Redevelopment
Property, or any part thereofand he Redevelep
Deed — shall — eArrc: aiT- t-- eeiTe- rrusrts en the pai-t feL-
itself and its sueeessers and
assigns, , and
its sueeesseL-s and assigns, shall promptly begin and diligently
prosecute to completion the redevelopment of the Redevelopment
Property through the construction of the Minimum Improvements
thereon, and that such construction shall in any event be
substantially completed within the period specified in this
Section 4.3.
Section 4.4. Certificate of Completion. (a) Promptly
after completion of the Minimum Improvements in accordance with
the provisions of this Agreement relating to the obligations of
the Redeveloper to construct such improvements (including the
date for completion thereof) and this Section 4.4, the Authority
shall execute and deliver to the Redeveloper the Certificate of
Completion. The Certificate of Completion shall be a conclusive
determination and conclusive evidence of the satisfaction and
termination of the agreements and covenants in this Agreement
with respect to the obligations of the Redeveloper and its
successors and assigns, to construct the Minimum-Improvements and
the date for the completion thereof.
(b) If the Authority shall refuse or fail to provide the
Certificate in accordance with the provisions of this Section 4.4
the Authority shall, within twenty (20) days after written
request by the Redeveloper, provide the Redeveloper with a
written statement, indicating in adequate detail in what respects
the Redeveloper has failed to complete the Minimum Improvements
in accordance with the provisions of this Agreement, or is
otherwise in default, and what measures or acts it will be
necessary, in the opinion of the Authority, for the Redeveloper
to take or perform in order to obtain a Certificate of
11
Completion.
(c)
deemed to
The construction of the Minimum Improvements shall be
be completed when the City has issued its certificate
cy for both the Reail Center Minimum Improvements and
e Center Minimum Improvements. the pe en of the
12
ARTICLE V
Tax Increment
Section 5.1. Tax Increment Certification. Pursuant to the
Redevelopment Plan, the Authority has pledged and shall
appropriate the Available Revenue to the payment of the principal
of and interest on the Note, said payment to be made in
accordance with the terms and provisions as stated in the Note.
13
ARTICLE VI
Prohibitions Against Assignment and Transfer; Indemnification
Section 6.1. Representation as to Redevelopment. The
Redeveloper represents and agrees that its purchase of the
Redevelopment Property, and its other undertakings pursuant to
this Agreement, are, and will be used, for the purpose of
redevelopment of the Redevelopment Property and not for
speculation in land holding. The Redeveloper further recognizes
that, in view of (a) the importance of the redevelopment of the
Redevelopment Property to the general welfare of the Authority;
(b) the substantial financing and other public aids that have
been made available by the Authority for the purpose of making
such redevelopment possible; and (c) the fact that any act or
transaction involving or resulting in a significant change in the
identity of the parties in control of the Redeveloper or the
degree of their control is for practical purposes a transfer or
disposition of the property then owned by the Redeveloper, the
qualifications and identity of the Redeveloper are of particular
concern to the Authority. The Redeveloper further recognizes
that it is because of such qualifications and identity that the
Authority is entering into the Agreement with the Redeveloper,
and, in so doing, is further willing to accept and rely on the
obligations of-the Redeveloper for the faithful performance of
all undertakings and covenants hereby by it to be performed.
Section 6.2. Prohibition Against Transfer of Property and
Assignment of Agreement. Also, for the foregoing reasons the
Redeveloper represents and agrees that prior to the issuance of
the Certificate of Completion:
Except for the purpose of obtaining financing necessary to
enable the Redeveloper or any successor in interest to the
Redevelopment Property, or any part thereof, to perform its
obligations with respect to making the Minimum Improvements under
this Agreement, and any other purpose authorized by this
Agreement, the Redeveloper has not made or created and will not
make or create or suffer to be made or created any total or
partial sale, assignment, conveyance, or lease (excluding tenant
leases), or any trust or power, or transfer in any other mode or
form of or with respect to the Agreement or the Redevelopment
Property or any part thereof or any interest therein, or any
contract or agreement to do any of the same, without the prior
written approval of the Authority. Any such transfer shall be
subject to the provisions of this Agreement. Notwithstanding the
foregoing, the Redeveloper may transfer the Redevelopment
Property to any corporation or other entity controlling,
controlled by, or under common control with the Redeveloper.
Section 6.3. Release and Indemnification Covenants. (a)
14
The Redeveloper covenants and agrees that the Authority and the
governing body members, officers, agents, servants and employees
thereof shall not be liable for and agrees to indemnify and hold
harmless the Authority and the governing body members, officers,
agents, servants and employees thereof against any loss or damage
to property or any injury to or death of any person occurring at
or about or resulting from any defect in the Minimum
Improvements, except for any loss resulting from negligent,
willful or wanton misconduct of any such parties.
(b) Except for any negligent or willful misrepresentation
or any negligent, willful or wanton misconduct of the following
named parties, the Redeveloper agrees to protect and defend the
Authority and the governing body members, officers, agents,
servants and employees thereof, now or forever, and further
agrees to hold the aforesaid harmless from any claim, demand,
suit, action or other proceeding whatsoever by any person or
entity whatsoever arising or purportedly arising from this
Agreement or the transactions contemplated hereby or the
acquisition, construction, installation, ownership, and operation
of the Minimum Improvements.
(c) The Authority and the governing body members, officers,
agents, servants and employees thereof shall not be liable for
any damage or injury to the persons or property of the
Redeveloper or its officers, agents, servants or employees or any
other person who may be about the Redevelopment Property or
Minimum Improvements due to any act of negligence of any person,
other than the negligence and misconduct of Authority employees
or those employed or engaged by the Authority.
(d) All covenants, stipulations, promises, agreements and
obligations of the Authority contained herein shall be deemed to
be the covenants,' stipulations, promises, agreements and
obligations of the Authority and not of any governing body
member, officer, agent, servant or employee of the Authority in
the individual capacity thereof.
Section 6.4 Subordination and Assignment. The Authority
recognizes that the Redeveloper may finance the construction of
the Minimum Improvements ( "Construction Loan ") and that in order
to do so, the construction lender will require a first mortgage
or other lien ( "Mortgage ") on the Redevelopment Property which is
prior to the rights of the Authority under this Agreement and mater
require � assignment of the Redeveloper's interest under this
Agreement. The Authority agrees that at the time of the closing
of the Construction Loan it will enter into a subordination
agreement and a consent to assignment in form and content
acceptable to the construction lender.
15
ARTICLE VII
Events of Default
Section 7.1. Events of Default Defined. Prior to the
issuance of the Certificate of CoLnpletion, the following shall be
"Events of Default" under this Agreement and the term "Event of
Default" shall mean, whenever it is used in this Agreement
(unless the context otherwise provides), any one or more of the
following events:
(a) Failure by the Redeveloper to pay when due any payments
or to provide any funds required to be paid or provided under
Article III of this Agreement.
(b) Failure of the Redeveloper to submit satisfactory
Construction Plans in accordance with Section 4.2 of this
Agreement.
(c) Failure by the Redeveloper to complete construction of
the Minimum Improvements pursuant to the terms, conditions and
limitations of Article IV of this Agreement.
(d) Failure by the Redeveloper to substantially observe or
perform any material covenant, condition, obligation or agreement
on its part to be observed or performed hereunder.
(e) The Redeveloper shall:
(i) file any petition in bankruptcy or for any
reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under the United
States Bankruptcy Code or under any similar federal or state
law; or
(ii) make an assignment for the benefit of its
creditors; or
(iii) admit in writing its inability to pay its debts
generally as they become due; or
(iv) be adjudicated as bankrupt or insolvent; or if a
petition or answer proposing the adjudication of the
Redeveloper as a bankrupt or its reorganization under any
present or future federal bankruptcy act or any similar
federal or state law shall be filed in any court and such
petition or answer shall not be discharged or denied within
ninety (90) days after the filing thereof; or a receiver,
trustee or liquidator of the Redeveloper or of the
Redevelopment Property, or part thereof shall be appointed
in any proceeding brought against the Redeveloper and shall
not be discharged within ninety (90) days after such
16
appointment, or if the Redeveloper shall consent to or
acquiesce in such appointment.
Subsequent the issuance of
the Certificate of Completion, an Eve f Default shall mean
above the nonpayment f gn proo�ertvQ taxes. JAL
Section 7.2. Remedies on Default. Whenever any Event of
Default referred to in Section 7.1 of this Agreement occurs, the
Authority may take any one or more of the following actions after
providing thirty days' written notice to the Redeveloper of the
Event of Default, but only if the Event of Default has not been
cured within said thirty days, or if the Event of Default is by
its nature incurable within said thirty day period, and the
Redeveloper fails to provide the Authority with written
assurances, deemed satisfactory in the reasonable discretion of
the Authority, that the Event of Default will be cured as soon as
reasonably possible:
(a) Suspend its performance under this Agreement and the
Note until it receives assurances from the Redeveloper, deemed
adequate by the Authority, that the Redeveloper will cure its
default and continue its performance under this Agreement.
(b) Terminate this Agreement.
(c) Withhold the Certificate of Completion.
Section 7.3. No Remedy Exclusive. No remedy herein
conferred upon or reserved to either party to this Agreement is
intended to be exclusive of any other available remedy or
remedies, but each and every such remedy shall be cumulative and
shall be in addition to every other remedy given under this
Agreement or now or hereafter existing at law or in equity or by
statute. No delay or omission to exercise any right or power
accruing upon any default shall impair any such right or power or
shall be construed to be a waiver thereof, but any such right and
power may be exercised from time to time and as often as may be
deemed expedient. In order to entitle the Authority or the
Redeveloper to exercise any remedy reserved to it, it shall not
be necessary to give notice, other than such notice as may be
required in this Article VII.
Section 7.4. No Additional Waiver Implied by One Waiver.
In the event any agreement contained in this Agreement should be
breached by either party and thereafter waived by the other
party, such waiver shall be limited to the particular breach
waived and shall not be deemed to waive any other concurrent,
previous or subsequent breach hereunder.
Section 7.5. Agreement to Pater Attorney's Fees and Expenses.
17
Whenever any Event of Default occurs and the Authority shall
employ attorneys or incur other expenses, such fees and expenses
shall be paid in accordance with Section 2.2(f) of this
Agreement.
18
ARTICLE VIII
Additional Provisions
Section 8.1. Conflict of Interest; Authority
Representatives Not Individually Liable. No member, official, or
employee of the Authority shall have any personal interest,
direct or indirect, in this Agreement, nor shall any such member,
official, or employee participate in any decision relating to the
Agreement which affects his personal interests or the interests
of any corporation, partnership, or association in which he is,
directly or indirectly, interested. No member, official, or
employee of the Authority shall be personally liable to the
Redeveloper, or any successor in interest, in the event of any
default or breach by the Authority or for any amount which may
become due to the Redeveloper or successor or on any obligations
under the terms Qf this Agreement, except in the case of willful
misconduct.
Section 8.2. Equal Employment Opportunity. The
Redeveloper, for itself and its successors and assigns, agrees
that during the construction of the Minimum Improvements provided
for in this Agreement that it will comply with all applicable
equal employment opportunity and non - discrimination laws,
ordinances and regulations.
Section 8.3. Titles of Articles and Sections. Any titles
of the several parts, Articles, and Sections of this Agreement
are inserted for convenience of reference only and shall be
disregarded in construing or interpreting any of its provisions.
Section 8.4. Notices and Demands. Except as otherwise
expressly provided in this Agreement, a notice, demand, or other
communication under this Agreement by either party to the other
shall be sufficiently given or delivered if it is dispatched by
registered or certified mail, postage prepaid, return receipt
requested, transmitted by facsimile, delivered by a recognized
overnight courier or delivered personally; and
(a) in the'case of the Redeveloper, is addressed to or
delivered personally to the Redeveloper at The Linn Companies,
Attention: Stephen L Linn, 1561 Woodlane Drive, Woodbury,
Minnesota 55125 -2222.
(b) in the case of the Authority, is addressed to or
delivered personally to The Housing and Redevelopment Authority
In and For the City of Fridley, 4701 Highway 61, Fridley,
Minnesota, 55110, Attention: Executive Director.
or at such other address with respect to either party as that
party may, from time to time, designate in writing and forward to
the other as provided in this Section.
19
Section 8.5. Counterparts. This agreement is executed in
any number of counterparts, each of which shall constitute one
and the same instrument.
Section 8.6. Time of the Essence. Time is of the essence
of this Agreement.
ARTICLE IX
Termination of Agreement; Expiration
Section 9.1. Termination. The Authority may terminate this
Agreement as provided herein, and otherwise this Agreement shall
terminate upon payment of the Note and the satisfaction of the
Authority Mortgage in accordance with its terms and the discharge
of all of the Redeveloper's and Authority's other obligations
hereunder, but no such termination shall terminate any
indemnification or other rights or remedies arising hereunder due
to any Event of Default which occurred prior to such termination.
Section 9.2. Sections to Survive Termination. Section 6.3
shall, in addition to the other surviving provisions referenced
in Section 9.1, survive the termination of this Agreement.
IN WITNESS WHEREOF, the Authority has caused this Agreement
to be duly executed in its name and behalf by its duly authorized
representatives, and the Redeveloper has caused this Agreement to
be duly executed.in its name and behalf by its duly authorized
representatives on or as of the date first above written.
21
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
OF FRIDLEY, MINNESOTA
By
Its Chairman
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, on behalf of said
Authority.
Notary Public
Authority Signature Page - Contract For Private Redevelopment
22
Dated:
LINN PROPERTY HOLDINGS, L.L.C.
By
Stephen L. Linn
Its
STATE OF )
) ss
COUNTY OF )
On this ' day of 199 before me, a
notary public within and for County, personally
appeared Stephen L. Linn to me personally known who by me duly
sworn, did say that he is the of
Linn Property Holdings, L.L.C., a limited liability company, and
acknowledged the foregoing instrument on behalf of said company.
Notary Public
Redeveloper Signature Page - Contract for Private Redevelopment
23
SCHEDULE A
DESCRIPTION OF REDEVELOPMENT PROPERTY
The Redevelopment Property is described as follows:
24
CERTIFICATE OF COMPLETION
WHEREAS, the Housing and Redevelopment Authority In and For
the City of Fridley, Minnesota, a political subdivision of the
State of Minnesota (the "Authority ") and Linn Property Holdings,
L.L.C. (the "Redeveloper ") have entered into a Contract for
Private Redevelopment (the "Agreement ") dated , 199,
regarding certain real property legally described in the attached
Exhibit 1 (hereinafter referred to and referred to in the
Agreement as the "Redevelopment Property "); and
WHEREAS, the Agreement contains certain conditions and
provisions requiring the Redeveloper to construct improvements
upon the Redevelopment Property (hereinafter referred to and
referred to in the Agreement as the "Minimum Improvements "); and
WHEREAS, Section 4.4 of the Agreement requires the Authority
to provide an appropriate instrument promptly after the
substantial completion (as defined in the Agreement) of the
Minimum Improvements so certifying said substantial completion;
NOW, THEREFORE, in compliance with said Section 4.4 of the
Agreement, this is to certify that the Redeveloper has
substantially completed the Minimum Improvements in accordance
with the conditions and provisions of the Agreement relating
solely to the obligations of the Redeveloper to construct the
Minimum Improvements (including the dates for beginning and
completion thereof), and this certification shall be a conclusive
determination of satisfaction and termination of the agreements
and covenants in the Agreement with respect to the obligations of
the Redeveloper, and its successors and assigns, to construct the
Minimum Improvements and the dates for the beginning and
completion thereof.
Dated: , 19
25
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
OF FRIDLEY, MINNESOTA
By
Its Chairman
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, on behalf of said
Authority.
This document was drafted by:
Notary Public
KRASS MONROE, P.A.
Suite 1100 Southpoint Office Center
1650 West 82nd Street
Minneapolis, Minnesota 55431
612/885 -5999
►T
SCHEDULE C
NOTE $175,000
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF ANOKA
THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR
THE CITY OF FRIDLEY, MINNESOTA
LIMITED REVENUE TAX INCREMENT NOTE OF 1997
(LINN PROJECT)
The Housing and Redevelopment Authority In and For the City of
Fridley, Minnesota (the "Authority "), hereby acknowledges itself to
be indebted and, for value received, promises to pay to the order
of Linn Property Holdings, L.L.C. or its registered assigns (the
"Registered Owner ") solely from the source, to the extent and in
the manner hereinafter provided, the principal amount of this Note,
being One Hundred Seventy Five Thousand Dollars ($175,000) (the
"Principal Amount "), together with interest thereon from the
Interest Commencement Date hereinafter defined Augut1, 1-99q at a
rate of 8.50, on the dates described below (the "Scheduled Payment
Dates ") and in the amounts as hereinafter defined (the "Scheduled
Payments "). The Scheduled Payment Dates are August 1, 1999, and
the 1st day of February and August thereafter until and including
February 1, 2012..
The Interest Commencement Date shall be the date on which the
Authority issues its Certificate of Completion which is defined in
the Contract for Private Redevelotment between the Authority and
the Registered Owner dated as f the
"Agreement ").
The Principal Amount is subject to prepayment at the option of
the Authority in whole or in part on any Scheduled Payment Date.
Each payment on this Note is payable in any coin or currency
of the United States of America which on the date_ of such payment
is legal tender for public and private debts and shall be made by
check or draft made payable to the Registered Owner and mailed to
the Registered Owner at its postal address within the United States
which shall be designated from time to time by the Registered
Owner.
The Note is a special and limited obligation and not a general
obligation of the Authority, which has been issued by the Authority
pursuant to and in full conformity with the Constitution and laws
of the State of Minnesota, including Minnesota Statutes, Section
469.178, Subdivision 4, to aid in financing a "project" of the
Authority, as therein defined, consisting generally of defraying
27
certain public redevelopment costs incurred and to be incurred by
the Authority within and for the benefit of its Redevelopment Plan.
THE NOTE IS NOT A GENERAL
CITY OR THE STATE OF MINNESOTA
AUTHORITY, THE CITY, THE STATE
THEREOF SHALL BE LIABLE ON THE
OUT OF ANY FUNDS OR PROPERTIES
REVENUE, AS DEFINED BELOW.
OBLIGATION OF THE AUTHORITY, THE
(THE "STATE "), AND NEITHER THE
NOR ANY POLITICAL SUBDIVISION
NOTE, NOR SHALL THE NOTE BE PAYABLE
OTHER THAN AVAILABLE mT V - NGRE;MB?P +
The Scheduled Payment of this Note due on any Scheduled
Payment Date is payable solely from and only to the extent of the
"Available Revenue" which is defined in the Genti-aetrer Private
as of (the "Agreefae Agreement.
The Authority shall pay on each Scheduled Payment Date to the
Registered Owner the Available Revenue. On February 1, 2012, which
is the final Scheduled Payment Date and the maturity date of this
Note, any unpaid portion shall be deemed to have been paid in full.
If a Transfer occurs, as defined in the Authority Mortgage
between the Registered Owner and the Authority dated
then one half of the outstanding principal ownin on this Note
shall be dew to have been mod. in full.
This Note shall not be payable from or constitute a charge
upon any funds of the Authority, and the Authority shall not be
subject to any liability hereon or be deemed to have obligated
itself to pay hereon from any funds except the Available Revenue,
and then only to the extent and in the manner herein specified.
The Authority makes no representation or covenant, express or
implied, that the revenues described herein will be sufficient to
pay, in whole or in part, the amounts which are or may otherwise
become due and payable hereunder.
The Authority's payment obligations hereunder shall be further
conditioned on the fact that there shall not at the time have
occurred and be continuing an Event of Default under the Agreement,
and, further, if.pursuant to the occurrence of an Event of Default
under the Agreement the Authority elects to terminate the
Agreement, the Authority shall have no further debt or obligation
under this Note whatsoever. Reference is hereby made to the
provisions of the Agreement for a fuller statement of the
obligations of the Redeveloper and of the rights of the Authority
thereunder, and said provisions are hereby incorporated by
reference into this Note to the same extent as though set out in
full herein. The execution and delivery of this Note by the
Authority, and the acceptance thereof by the Redeveloper, as the
initial Registered Owner hereof, shall conclusively establish this
Note as the "Note" (and shall conclusively constitute discharge of
28
the Authority's obligation to issue and deliver the same to the
Redeveloper) under the Agreement.
The Registered Owner shall never have or be deemed to have the
right to compel any exercise of any taxing power of the Authority
or of any other public body, and neither the Authority nor any
council member, board member, officer, employee or agent of the
Authority, nor any person executing or registering this Note shall
be liable personally hereon by reason of the issuance or
registration hereof or otherwise.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions,
and things required by the Constitution and laws of the State of
Minnesota to be done, to have happened, and to be performed
precedent to and in the issuance of this Note have been done, have
happened, and have been performed in regular and due form, time,
and manner as required by law.
This Note may be assigned but upon such assignment the
assignor shall promptly notify the Executive Director of the
Authority at the offices of the Authority by registered mail, and
the assignee shall surrender the same to the Authority either in
exchange for a new fully registered Note or for transfer of this
Note on the registration records for the Note maintained by the
Authority. Each such assignee shall take this Note subject to the
foregoing condition and subject to all provisions stated or
referenced herein.
The Authority has elected to issue this Note as a non -tax
exempt obligation and accordingly does not anticipate that the
interest on this Note is or will be generally exempt from federal
or state income taxes, and the Authority makes no representation or
covenant with respect to any such exemption.
IN WITNESS
executed by the
Director and has
WHEREOF, the Authority has caused
manual signatures of its Chairman
caused this Note to be dated
Chairman
This document was drafted by:
KRASS MONROE, P.A.
Suite 1100 Southpoint Office Center
1650 West 82nd Street
Minneapolis, MN 55431
James R. Casserly, Esq.
612/885 -5999
F \FRIDLEY \7 \D0C \C0NTRACT
29
this Note to be
and Executive
199.
Executive Director
CERTIFICATE OF REGISTRATION
It is hereby certified that the foregoing Note, as originally
issued on , 1997, was on said date registered in
the name of Linn Property Holdings, L.L.C. and that, at the request
of said Registered Owner of this Note, the undersigned has this day
registered this Note as to principal and interest on the Note in
the name of such Registered Owner, as indicated in the registration
blank below, on the books kept by the undersigned for such
purposes.
Name of
Registered Owner
Linn Property
Holdings, L.L.C.
Date of
Registration
30
199_
Signature of
Executive Director
SCHEDULE D
RETAIL CENTER ENHANCEMENTS
See Schedule D -1 attached for a listing of the Retail Center
Enhancements
31
Demolition
Acquisition
Site Preparation
Site Utilities
Irrigation
Landscaping
Retaining Walls
SCHEDULE E
SITE IMPROVEMENTS
32
SCHEDULE F
114NES07.
Trade & Nlinnesota Business Assistance Form
Economic
Development
Please type or print in dark ink.
1. Funding government agency name
11. Date of business assistance agreement
2. Agency street address
13. Hourly wage level goals for business receiving assistance
3. City
4. Zip Code
5. Phone number (area code)
6. Fax number (area code)
7. Contact name
8. Type of government agency
_ City _County _Regional _State
Other (Please indicate)
9. Name of TIF district (if applicable)
10. Name of business receiving assistance
11. Date of business assistance agreement
12. Job creation goals for business receiving assistance
13. Hourly wage level goals for business receiving assistance
14. Actual jobs created since business received assistance
15. Actual average hourly wage paid to employees hired since
business received assistance
16. Last date actual wage and job creation levels documented
* Please complete one form for each business project your agency assisted with $25,000 or more in public funds.
Do not submit this form if assistance has not been provided to a business.
Please send completed form annually by April 1 to:
Minnesota Business Assistance Form — AEO
Minnesota Department of Trade and Economic Development
Analysis and Evaluation Office
500 Metro Square
121 East 7th Place
St. Paul, Minnesota 55101
33
or fax report to:
(612) 215 -3841
For information, call:
(612) 297 -2335 or 1-800-657-3858
SCHEDULE G
SITE PLAN
34
SCHEDULE H
AUTHORITY MORTGAGE
This Indenture, made this day of 199_, between
Linn Property Holdings, L.L.C., a Minnesota limited liability
company (the "Mortgagor "), and the Housing and Redevelopment
Authority in and for the City of Fridley, Minnesota (the
"Mortgagee "):
WITNESSETH:
That Mortgagor, in consideration of the Mortgagee's covenants
and agreements made under that certain Contract for Private
Redevelopment by and between the Mortgagee and Mortgagor, dated as
of , 199 (the "Agreement "), and in order to secure the
payment by the Mortgagor of all amounts required to be paid under
the Agreement as provided in Section 3.3 of the Agreement, and
further in consideration of the sum of One Dollar ($1.00), to
Mortgagor in hand paid by Mortgagee, the receipt whereof is hereby
acknowledged, does hereby convey unto Mortgagee, forever, real
property in Anoka County Minnesota, described as follows:
See Exhibit 1 attached
together with all hereditaments, improvements and appurtenances
belonging thereto (the "Property ").
TO HAVE AND TO HOLD THE SAME, to Mortgagee forever. Mortgagor
covenants with Mortgagee as follows: That Mortgagor is lawfully
seized of the Property and has good right to convey the same; that
the Property is free from all encumbrances, except as follows:
that Mortgagee shall quietly enjoy and possess the same; and that
Mortgagor will warrant and defend the title to the same against all
lawful claims not hereinbefore specifically excepted.
PROVIDED, NEVERTHELESS, that if Mortgagor shall pay Mortgagee
all amounts payable by the Mortgagor under Section 3.3 of the
Agreement which amounts shall not exceed the sum of $50,000, and
shall repay to Mortgagee, at the times and with interest as
35
specified, all sums advanced in protecting the lien of this
Mortgage, in payment of taxes on the Property and assessments
payable therewith, insurance premiums covering buildings thereon,
principal or interest on any prior liens, expenses and attorney's
fees herein provided for and sum advanced for any other purpose
authorized herein, and shall keep and perform all the covenants and
agreements herein contained, then this Mortgage shall be null and
void, and shall be released at Mortgagor's expense.
AND MORTGAGOR covenants with Mortgagee as follows:
1. To pay the amounts as specified in the Agreement and
2. To pay all real estate taxes and special assessments now
due or that may hereafter become liens due against the Property
before penalty attaches thereto;
3. To keep all buildings, improvements and fixtures now or
later located on or a part of the Property insured against loss by
fire, extended coverage perils, vandalism, malicious mischief and,
if applicable, steam boiler explosion, for at least the amount of
the Mortgage at all times while any amount remains unpaid under
this Mortgage. If any of the buildings, improvements or fixtures
are located in a• federally designated flood prone area, and if
flood insurance is available for that area, Mortgagor shall procure
and maintain flood insurance in amounts reasonably satisfactory to
Mortgagee. Each insurance policy shall contain a loss payable
clause in favor of Mortgagee
affording all rights and privileges customarily provided under the
so- called standard mortgage clause. The insurance shall be issued
by an insurance company or companies licensed to do business in the
State of Minnesota and acceptable to the Mortgagee. the insurance
policies shall provide for not less than ten (10) days written
notice to Mortgagee before cancellation, non - renewal, termination,
or change in coverage, and Mortgagor shall deliver to Mortgagee a
duplicate original or certificate of such insurance policies.
4. To pay, when due, both principal and interest of all
prior liens or encumbrances, if any, and keep the - P:Fep_ e
5. To commit or permit no waste on the Property and to keep
it in good repair.
6 . Te- eemplete- -ferthwith afty -f=r == - - eats = hi h may
herea_ftei- be re eL- ,eeurse -ef eenstLdetien --ems -- the -PiFep rtl ; and
46. To pay any other expenses and reasonable attorney's fees
incurred by Mortgagee by reason of litigation with any third party
for the protection of the lien of this Mortgage.
36
47. To immediately pay the Repayment Amount (as defined
below) if there is a Transfer (as defined below) of the Property or
any part thereof. The Mortgagor may use the InStallmPni- n„+ -;,,,,
unde�ee� ten eenti -el a --A4� --tgei-- er---the r ei-ty m , be
- -��
transfeLcred te Stephen I= '
to the
a�rr.-
"Repayment Amount" means one half of the
by -a fi-aet= -the
Value„
is
ear erate:e
ameunt -ef the -Equity - liavestffte=t
of whieh
(as
the aggL-egate
defiired berew;-
thei-e t f the-
PeL-tg-ags
-acrd -the a.. .,ter
e e r- e-made -may-
efthe -EEfaity
,
!RvesteieRt
prepaymeRto
is this
the Mertgageic's
-Net Tet-alr
PLce art..
of whieh sum e
!RvestmeRt (as defined
-
!
ew) the
"FaiL- Market
Value„
faeans
the - sales
-prree -ethe
Prepe-t less-
breleei-Is
fees
-ethe - -ts
j,
TL-anafe3F
and
the PL-
L ees
in
e€ - sale,
r,imed- upaY
Mv
of
epe3Ft j .
the ev:ent
that a Transfe
s deemed
than
t have
the
-e ed
Fali- Mai-ket
by -- -----
Value
=f
an event ether-
be as- agreed
open between
a sale,
the - MertgagezzMeLctqagee
shall
.
if
bezeaehed,the
Fa'
M,_e-
ne- ueh agr-eefaent
aan
M
soal:ue shall be
deterfarned
by- thi-ee-
-(3) app-
- -- -- - ,
ene
seleeted by the
- MerrtgageLc,
- eRe-
geleeted the
,
ON-
0 INN
"FaiL- Market
Value„
faeans
the - sales
-prree -ethe
Prepe-t less-
breleei-Is
fees
-ethe - -ts
j,
TL-anafe3F
and
the PL-
L ees
in
e€ - sale,
r,imed- upaY
of
epe3Ft j .
the ev:ent
that a Transfe
s deemed
than
t have
the
-e ed
Fali- Mai-ket
by -- -----
Value
=f
an event ether-
be as- agreed
open between
a sale,
the - MertgagezzMeLctqagee
shall
.
if
bezeaehed,the
Fa'
M,_e-
ne- ueh agr-eefaent
aan
M
soal:ue shall be
deterfarned
by- thi-ee-
-(3) app-
- -- -- - ,
ene
seleeted by the
- MerrtgageLc,
- eRe-
geleeted the
,
37
and then,_ ti.a seleeted by
investment" means a!!
fi-em
-a
said
by ef - -.said
0
tyiC� —c��
a.-, a ...,-a- ,1
said appraisal,
ci�
r-Z1 shall e'nt L-e l .
by 'ant i
the
redideee - the ei rn,
y __alu
-tPad Bests
ef--a sale,
—ceding breleerage - fees,
and by eests
ef the
"Meictgagei' s'-Net Tetal
of the- MeL-tgagereentLcihuted
investment" means a!!
fi-em
ef tie -funda
ebtained
t
time t ► tifae
ze t4iC
imrrteoFement
�re- e
eT- ra-iis -f-er faced to the
,
t
aRy payment
impreveftent -Le., (as defined
ef 19 -Ine_: r a fa. de eat
belew) rte irr� -rzztr
"Impr-&�rement
Mertgager-
T=ean" Faeans
te finanee -tire
the lean
'
ebtained
t
by the
'
the Pi-epe
imrrteoFement
�re- e
eT- ra-iis -f-er faced to the
en and eenst
t f
lead
seeurre.7 b
Rd
a first s +
-s— crhere•�'�wrhieh
the +- _ .
Is
a- +
-- --1'
- -- -- =fig-
ten
age- ��P-
the Mertgager,the
�e- :�-
er- �i-�l� the
issues
prrer
debt -
eensent
te-
ef -
the
ee- -e-€
any
is
refinanee
in
evement
the
-Leali
standing debt
,
eh
net nemeess
of
l
inn in
g
#
need
refinaneing—
i der
- plus -i-easenab
in additren
to
e-ee st
, the
t
s __ red
MeLetg-ager agrees
-fie
in its l
Bens -(and
eensent
-ewe
Bens ent- -te ,
s e e
"it
!A-vestment"
t teta -fie e .ti.ai
t-e the
means
Elate e
�re- e
eT- ra-iis -f-er faced to the
payments
MertgageLc,
aC. C3erTi'CLSleCy'dPl
Irye- reftent--
,
by the
as --
registered
-ewe- ,
the LiffliCCCii Revenue
-"GTl
Net-e
Ci2 'e-Tr1- ['RTe
-ef 199n (TinnPrefeet)
- IC
.
"Transfer" or "Transferred" means the sale or conveyance
of the Property whether by deed, contract, lease or
otherwise or any change in the identity of the Mortgagor
except as provided abeve-in this rai-agrap 8. if a
VVIAll VGA !-/.Z - -ZJ-v a- i, - - -- , +-.-. .. - --
be- deemed -te- have - eeeu3Fred -en that Elate . herein. If a
-Li- payment of the Note as provided for in the
events
38
In case of failure to pay said real estate taxes and soe
assessments, prior liens or encumbrances, expenses and reasonable
attorney's fees as above specified, or to insure said buildings,
improvements, and fixtures and deliver the policies as aforesaid,
Mortgagee may pay such real estate taxes, special assessments,
prior liens, expenses and attorney's fees and interest thereon, or
obtain such insurance, and the sums so paid shall bear interest
from the date of such payment at the same rate of 8.501 per annum,
and shall be impressed as an additional lien upon the Property and
be immediately due and payable from Mortgagor to Mortgagee and this
Mortgage shall from date thereof secure the repayment of such
advances with interest.
In case of default in any of the foregoing covenants, and the
passage of any applicable periods of cure or notice set forth in
the Agreement, Mortgagor confers upon the Mortgagee the option of
declaring the unpaid balance of the Note and the interest accrued
thereon, together will all sums advanced hereunder, immediately due
and payable without notice, and hereby authorizes and empowers
Mortgagee to foreclose this Mortgage by judicial proceedings or to
sell the Property at public auction and convey the same to the
purchaser in fee simple in accordance with the statute, and out of
the moneys arising from such sale to retain all sums remaining due
under this Mortg seeure , with interest and all legal
costs and charges of such foreclosure and the maximum attorney's
fees permitted by law, which costs, charges and fees Mortgagor
agrees to pay.
The terms of this Mortgage shall run with the Property and
bind the parties hereto and their successors in interest.
IN TESTIMONY WHEREOF, Mortgagor has hereunto set its hand the
day and year first above written.
39
F \FRIDLEY \7 \DOC \CONTRACT
EXHIBIT 1
LEGAL DESCRIPTION
41
40
C M. QW-travel
con and sales M.,
'A.
S-I*s show do 75% ofourreuias
travel regularly on business. But if
You want to hit am where JW live,
our navel RWE section is the ptsee
to advert=
After 8% am S7,0W offt am's
101) -WOK managers and bW-
vans ommseadOyBtaftwevery
%V& gone 0M 0110 it an the mad
with than
To make Your Spare reservation mU
388.2124.
28&2123
k REGION
,from page 39
compete' for ecorromile-&—mopit
jobs." said Joseph Stmras, mcutiv,
Of the North Metto Mayors AssQphg
54,568. households and 94,431 jobs. Major Thr2d projects. Include, Improve
s. Corl)(01110113 located here include General lilghwy'100 frorn Highway 55 all
Mills Inc;, Graco Inc., Tmuim Co. and Grow through Brooklyn Center -71ist p
Biz International Inc. in Golden Valley. expected to 11119511dW Wid" the
Fridley Is home to Medtronic Inc. and The Years. -lWs a big: success for
Roalund Co. Inc., while New Hope is the
headquarters for Navarre Corp.
Center, RObblinsdale..Cry" Now I
Golden VORON" Strauss a",-,
Although some new development is occur.
The expansion of Highway 6
ring, activity in this older region is being dri-
ven largely by redevelopment projects. In the
called the Norther Crosstown, is an
project that will have a major IMPVA
Valley square Redevelopment Arm for
examPlo an 8-acre site located at the comer
northwestern
I
will con,= Brocklyu, Park Map
to
of Highway 55 and Wisconsin Avenue, devel-
and win parallel the Highway 620
Opera am proposing a 120,000-square-foot
office space.
in the south
Golden Valley was ranked among the top
0
75 cities in the metro area for
It's rot as caw, to
commerciallindustrial per-its granted in
19 with$7 million. Fridley is another active
4 "'first4ier
ariesoi
of the in,
cities C
suburb with 1995 permits valued at
$122 million, according to the Met Council.
Rockford,
H.Dvcr Champlin. rinit"Da"
The bulk of the northwest metro's new res-
idential and commercial development is
Andover, Bums,' Oak Grove
Ham Lake. Both reddential-and
Occurring in the middle-ring suburbs. Cities
include Map I lo Grove, Brooklyn Park, Osseo,
expansion ared- yll0rougingth,
outer-ring * c:ommunidm Major crap
Coriu� Rapids and Blaine. These communities
. p
located
WateedhereinrA
am home to 208,966 people, 72,723 house-
holds and. 64,2M jobs.
Anoka, amt Ultra pat, lzx.. of Rogeri"
Many of these cities ranked among the top
`20
Residential development hene, is':
rise, but home values vary; Amang-ti
communities in the metro area for single-
family home-building permits in 1996.
p, 5
aiab q
Plymouth reported 441; Brooklyn Park, 433;
Maple Grove, 356; Blaine, 263; and Coon
mits in 1996. and Ramsey. wh
Residential Permit values raw act
Rapids, 7
'43. The average value of a new
board from an average of $98= in I
home ranged from $109,689 in Blaine to
$84,720 in Coon Rapids. Top ranking middle-
'K
ring suburbs for new commercialfMdustrial
crininuerciaijindusarial permit Vah,, is
Permits in 1995 included Coon Rapids at $34
million, Plymouth at $18.4 million, Maple
1995 include Anoka with $13 mW
Champlin with $9.2 nuffirm.
Grove at $16.5 million and Brooklyn Park at
$13.3 million according to the met council.
In many cases, outer ring cities A
"Plymouth hosts a variety of major corpo-
going a marsiorrandon &ahliS6
communities such ao, BUN% Elk RD
red— including Polaris Industries Inc.,
Mirmi-h Corp., Grand Casinos Inc., Wes
Zinuatermar, aro'being.Weived.by.in
oftb
now TWin Clties,"stibu;t"
Homes Inc. Norstim Inc., In Home Health
Inc. and Braun's Fashions Corp. Other major
are capitalizing on the �=
attract new business. --
employers include Computer Network
'We- all really . aware of the fe
Technology Corp. in Maple Grove, and
Datuark International and Network Systems
industry is needed fairthe tax bW sid
Rose, director of the Economic DOW&
Corp. in Brooklyn Park,
Plymouth has been very active in recent
S-I*s show do 75% ofourreuias
travel regularly on business. But if
You want to hit am where JW live,
our navel RWE section is the ptsee
to advert=
After 8% am S7,0W offt am's
101) -WOK managers and bW-
vans ommseadOyBtaftwevery
%V& gone 0M 0110 it an the mad
with than
To make Your Spare reservation mU
388.2124.
28&2123
k REGION
,from page 39
compete' for ecorromile-&—mopit
jobs." said Joseph Stmras, mcutiv,
Of the North Metto Mayors AssQphg
54,568. households and 94,431 jobs. Major Thr2d projects. Include, Improve
s. Corl)(01110113 located here include General lilghwy'100 frorn Highway 55 all
Mills Inc;, Graco Inc., Tmuim Co. and Grow through Brooklyn Center -71ist p
Biz International Inc. in Golden Valley. expected to 11119511dW Wid" the
Fridley Is home to Medtronic Inc. and The Years. -lWs a big: success for
Roalund Co. Inc., while New Hope is the
headquarters for Navarre Corp.
Center, RObblinsdale..Cry" Now I
Golden VORON" Strauss a",-,
Although some new development is occur.
The expansion of Highway 6
ring, activity in this older region is being dri-
ven largely by redevelopment projects. In the
called the Norther Crosstown, is an
project that will have a major IMPVA
Valley square Redevelopment Arm for
examPlo an 8-acre site located at the comer
northwestern
I
will con,= Brocklyu, Park Map
to
of Highway 55 and Wisconsin Avenue, devel-
and win parallel the Highway 620
Opera am proposing a 120,000-square-foot
office space.
in the south
Golden Valley was ranked among the top
0
75 cities in the metro area for
It's rot as caw, to
commerciallindustrial per-its granted in
19 with$7 million. Fridley is another active
4 "'first4ier
ariesoi
of the in,
cities C
suburb with 1995 permits valued at
$122 million, according to the Met Council.
Rockford,
H.Dvcr Champlin. rinit"Da"
The bulk of the northwest metro's new res-
idential and commercial development is
Andover, Bums,' Oak Grove
Ham Lake. Both reddential-and
Occurring in the middle-ring suburbs. Cities
include Map I lo Grove, Brooklyn Park, Osseo,
expansion ared- yll0rougingth,
outer-ring * c:ommunidm Major crap
Coriu� Rapids and Blaine. These communities
. p
located
WateedhereinrA
am home to 208,966 people, 72,723 house-
holds and. 64,2M jobs.
Anoka, amt Ultra pat, lzx.. of Rogeri"
Many of these cities ranked among the top
`20
Residential development hene, is':
rise, but home values vary; Amang-ti
communities in the metro area for single-
family home-building permits in 1996.
active outer-ring subuft for new ra
development ate Andover with 272 a
Plymouth reported 441; Brooklyn Park, 433;
Maple Grove, 356; Blaine, 263; and Coon
mits in 1996. and Ramsey. wh
Residential Permit values raw act
Rapids, 7
'43. The average value of a new
board from an average of $98= in I
home ranged from $109,689 in Blaine to
$84,720 in Coon Rapids. Top ranking middle-
to the 21 permits in Corcoran that a,
$279,517. Top ranking outer ring sub,
ring suburbs for new commercialfMdustrial
crininuerciaijindusarial permit Vah,, is
Permits in 1995 included Coon Rapids at $34
million, Plymouth at $18.4 million, Maple
1995 include Anoka with $13 mW
Champlin with $9.2 nuffirm.
Grove at $16.5 million and Brooklyn Park at
$13.3 million according to the met council.
In many cases, outer ring cities A
"Plymouth hosts a variety of major corpo-
going a marsiorrandon &ahliS6
communities such ao, BUN% Elk RD
red— including Polaris Industries Inc.,
Mirmi-h Corp., Grand Casinos Inc., Wes
Zinuatermar, aro'being.Weived.by.in
oftb
now TWin Clties,"stibu;t"
Homes Inc. Norstim Inc., In Home Health
Inc. and Braun's Fashions Corp. Other major
are capitalizing on the �=
attract new business. --
employers include Computer Network
'We- all really . aware of the fe
Technology Corp. in Maple Grove, and
Datuark International and Network Systems
industry is needed fairthe tax bW sid
Rose, director of the Economic DOW&
Corp. in Brooklyn Park,
Plymouth has been very active in recent
Partnership ofwd& County-
Residential growth is
going -040
years, and much of its land has already been
n
developed. Maple Grove also is seeing
in Sh-bume Capnty�parily . is&
aide the 149 Council's . becai
increased development activity with only
about one-half of the city &welopej Growth
and them an few barWd=Wf,�bM=de
said Micheal DW,1 g deveU
that started out as residential is now shifting to
mm-W and Industrial. one new area the
coordinator If Sb,,b,,,a Co, V,'
, . 94
am ft hSteavowing Utuy In rest
city I- targeted for new development is a
2000 -are former gravel pit.
-
growth in the stank" Dm;i sdiril-` *�,X
I . ; A.
Shaba= ODMIY� IR-W
Although Brooklyn Park is an older corn-
�917*
i!
family permits In 1996 wWart 0'e'rem
munity, it still has one-third of its land yet to
develop. `The city at this point is taking a
of $97,389. And along with the fadA
growth comes Increased Oita U* to attrio
very close look at what kind of mix of hoes-
ing they want in the city as a total, while they
business tD the area- :-
71te big economic development h�;
still be- sae third of the land to make
re
changes in the balance," said Marge
land, people' and resom= Mia cftyij
River, for 0XIMIPIC, Plans to add an add
Friederichs, executive vice president of the
North Hennepin Chamber of Commerce.
400 acres of Industrial property, wbji
Lake is working to bring 60 actres ofini
Economic development in Anoka County
has focused almost exclusively on attracting
al land on-line along Highway Omy lO.Nc
Elk River; Zinimerm Also 1;_waxld
the emerging technology -based companies,
said Roger Jensen, executive director of the
expand its city land by timeating no*
land and axmfnding water and sewer
Anoka County Economic Development
Partnerabip. The partnership capitalized on
=
one obstacle for business growth In
---g communities is the Knew
the fact Medtronic was based in Fridley,
and the corporation was spinning off a lot of
already tight labor market Budmw
concerned that's lack of qualified a*
new companies, Jensen said. One of the big
successes has been the development of the
will affect their 'ability . to SW4�
Sherburne County solution. is to par
Minnesota Medical Enterprise Park in Coon
Rapids.
"school-to--woW program to get sin
A major focus for many of these crimmu.
into avail" jobs as well as educating
ocam on available resouz�-
nitres as Is improving the transportation inim-
smLcWm 'fransportalion obviously is key to
is
d
a
X
In as
Northwest
Metr6
load
rovx+ moves
X: J
reanto the fast lane
n�estment'to follow Highway 610
�ro Prise
"Highway 100 absolutely
is our next big
F
priority in this area." said Tinklenberg, who
nm&*w Suburbs primed for ,Or,
of fob" am 0 remains active with " regional .
over the next Organizations that have been lobbying feder.
=tth.
Plearned al and state officials to bring more tram.
or S now roadway ponadon firadiag into the northwest Sub.
-of-Arbusands more urbs. 1 don't think you have to ten anybody
day who's driven on that road between [inter -
'dniCfion iislated "to` begin next states] 394 and 694 that something has to be
On rte fast phase OF Highway 610, done soon.-
which will
But few area communities have escaped
edt Foos Raplda and Blaine across the at least some traffic problems In recent
A'0 bridge over the Years, and as more new development moves
MD- Brooklyn Park and out to the far corners of the nwhvpo&m
VbJM complete, the $145 area the traditional commuting - patterns
In PlqeCt W&UMY Will extend west through the region are changing a well, said
4R* GOO- Odadd A-Rewand much- Curt Larson, an economic development spe.
terstates 94 and 35W, cialist for the city of Blaine.
kb,VbWi,'ft D10way] 610 tarok is more of the driving is from Suburb to
to sput'a lot of hdlstriW and com- suburb rather than to and from the central
ard" SCOW& for U$:,' said Scott Clark, cities, he Observes, which in turn is forcing uNt3 . OPMeat director in city planners to grapple with growing con-
dyapark."Waareal opportunity for us gestion on secondary roads and Streets odg_
4
to MOM bshmci 10 the City With a inally designed to handle far less traffic.
2' 6e traditional outatla-truing- di-- SO far, Larson said the escalating truffl,
on
new ties while coupled with a relative lack of state and fed-
for those high"- eral funding in the past for road repairs and
ra industrial [Properties] and —Pu- new 60ustruction has yet to advergely nifect
L_Velomeft• - development is the northwestern Suburbs.
L416 in Other cities along the project "We've been pretty busy here and expect
ftWWI volo6d high exPectatim that to stay that way for a long time," he Said.
Ibrth.,',Civsstown will uabor in an "But when you look at how fad other areas
led " period
of Tilt bnlldiag anti job have grown after they built roads like the
—them Crosstown [Highway 623. you can
tumid of Sig. we the huge impact a now road can have. I
Of the just think this am Probably Would have
lk� the divi- developed much more quickly if they had
In Anoka built [Highway 610110 or 20 years.ago.7
or Of Blaine.
omits not Drily go ing Bridging the
gap
tie'1{ate area Longer torm, maw community officials
SnYual
of bridge said another dge across the Mississippi
pliich between Anoka and the Highway 610 cross-
Of the ing eventually will be needed to foster those
it has burgeoning economic ties between cities in
IVI `otimmon
identity the northwest suburbs.
* and northwestern sub- Work on a new Mississippi River bridge
6,tShOtdd work to aid future efforts to In Anoka
Should be completed by next aum-
ethe lufreshncture. mer, said Robert Kirchner, the city's com-
munity development director. But he Said
Won iffiesd "T. that Project is not expected to sigofficantly
Z fterone Was predicting that the new add to the overall capacity of the axis tag
iota' Would be a tin
Wan; panacea, structures In the area to carry traffic across
'—k is needed the river and that a larger bridge Will need to
r mdat bIghWdys.ln,ft am to alle- be built.
18olng tuft dfffioultIes, "Mat's probably the most Important
. matte persiftnt bottlmecks am infraStraer"a improvement that We Could
B$h*O 109 through Golden Valley, do," he said. "Not having that bridge hasn't
Mob
, J.&.pbinU north and on really affected residential or commercial
1, 9416" 1 development around here too much because
an _! we get a lot of our labor force traveling in
I USF from central Minnesota. Where I think that a
10 new bridge Will have the most benefit are in
least diRgOrW froth die St. Cloud those communities to our South by helping
tOOA Mk RhT4 Anoka and Coon maintain their accessibility to the rest of the
metro area:'
42 CltjB, inesa� t' 1
a'
Busirrew in the
Northwest
Meto
k�
4 f
J * A'--'
I
�,W,
Commercial
prod, �.� Y
are reshaping chid l .4
� a
In nortl�iwest sub :#
. . . . . . . .
Construction boom, ci b c 3 a
ByMerlin'Keller
between the Cities
Co1°"8 "
and
arrival of a Target store and Cpbbda.gS
As the road goes, so goes retail develop-
highway 169. A muribef: of
meat. The adage holds true is the northwest
satellites Including branch badta
metro area, where development is shaped by
fmnchim and autorelated rttail
such highly traversed routes as Interstate 94,
up alongside the; two stores, sun
Highway 65 and new connecting routes that
Radio Shack to s and
Will link laterstate 35W and I -94 and other
Bagel
ag Haltmy. Add;a 61,000- sgpappfiat
highway sections in what many refer to as
Menards store and a 60,000.square•&t� Wit[
the North Crosstown.
Foods am Highway 169 on the eastt ,,of
But marls alone aren't responsible for the
tha blgbway amt the pie= help total tt�gh,
boom in commercial development there.
ly $14 million in 1996 in remit dgvaLapr>ojtt
Other factors such as demographic changes,
that Stelnmap has am since taking l
the growth of industrial and manufacturing
Job just trine montlte Age., yF ;
sites and general community needs for retail
"Our commercial rem8'davelopmant was
properties, big and small, franchises or inde-
stronger Iasi you than our Wk%tdal,1111
Pendants, all work together in forming the
noted
commercial landscape that winds its way
from Elk River to Maple Grove, Brooklyn
Meanwhile queries frorn brand yams
hotels from both the East and Wgstposgts
Park and Brooklyn Center, Fridley and into
have also crossed Steinman's' desk.: Also
Coon Rapids and Blaine.
pending is 60,01)0- square -foot Ml4rYgst
Elk River
Sports Federation of the Twin, a
sports complwt for Aft, ficttaioing igd.togrf
A trailer park occupying 70 acres of land
namems not uallb one built fn. Blift -A ia:
around Elk River is closing soon, freeing up
1985. The federation pas oast a.lQlrr!?r of
soother 70 acres of land zoned mostly for
eomnmrclal purposes. According to Paul
intent to city offices,,ys, ;
Today the driving t lem�ts ofglj Rh s
Steinman director of economic develop.
meta in Elk River, the cloning is just aaoth•
retail development, re&o huvdy vpJtbJ
community, ramilpis and the
ar si of the times on the city's !an ty' busy Gavel-
aPment agenda Steinman said that Griffin
don't save to . doal'Whh the Met
over issues ,of planting
^os. of Minneapolis is currently looking for
Steinman said The asy's low tau
Mm" "big -box" anchor tenants for a
a� new
maple
ihopping district on the property in the
the population's dedte m have a foll;:seoe
FBghway 10 and 169 quadrant.
Last year, the scenic little stop halfway
retail environmem make' it attYgclivevtol
retailers who see rim poteNial 'he adds h eh
:r
LVXuVe
years of talk about building a large
mall in Maple -Grove with at least
)r developers on either a gravel-
to or a rates 100 -acre treat of land
V the Ossee School District, talk
I is all the city has to show for real -
wmmerclel pmjeets.'Onthe other
0 street improvements along Elm
ulevard, lots of office development
ashtg �natruction of singlafemily
mtinne to draw brace retailers to
,—.dean, Maple
see a regional shopping center
ii Madsen said. Part of the imped-
s [bet not !o Maple Orove 3s
mmy teglottal malls
ion to 13•,nilB{on equate feet are
u anywhere auymora" Ie probably
sip either• that Northtoavn Mall affi
e Center are both within 15 miles
V.`Tbat aaid,'the city seems to be
ing a healthy infusion of new
s along Ehn Creek Boulevard, and
rding-Famous Dave's BBty, along
hotels as well as some larger storm
t the wofti .
Hampton Im opened last week, in
str Ehn Creek Boulevard and I -94
sen describes as "die downtown
ie lack of:a bettee'wonl," A- new
ituendedStayAmerlce, catering to
ieople ib foam tot a few days, •is
the sounh end of toaro
s'1h[get store, dther a Superstore
athad building located at 95th
ad 144, eeettts to be the biggest
dopmept thme days,-with 189,000
d in &a offing. "foget hasn't told
at type store they're building yet,
will open, but they're making site
[.. Center
kdale"tor has long been the retail
a Brooklyn Cromer; a burg of 30,000
L, But Brockdale is emblematic of
a retail locations, whom retail devel-
Ttas already puked and redevelop -
;$ue buzzword of the day.' Many of
00 "for Bmokdale's largest tenants
ly are tip this yeay fliaBag ap-wa-
ftim mall may be, in ttonbht {f any
ooil Mara dtase,ittmcaa,'bui I•am
'_ablt4f poshtrjng on the pert of the
°isld[P6n Vhmei, head of the city's
(andponingdVertment forthe past
Matzen does say that the mall she
d of smte foods fora water diversion
F now the hot redevelopment areas
mg.. 67th Avenue and Brooklyn
zd. where a 70,000 -square-foot
r Foods is under construction, with a
�Walgreen , Drug Store and a
rod Video. And. a new 85 -unit
-hm bt Su tes, with a TO Fridays
on its west aide :and room for
"Stamant on its east wing, should
on said the areas [tear 69th and 70th
and Bmoldyn Boulevard could also
rielopment, some oP it tied to the
road- widening improvement 'plans
are Hennepin County officials. The
truly. has a preliminary agreement
developer to-build "neighborhood -
busireasev ".at 69th Avenue, but big
seem to bee thing of the past.
Brooklyn Park
Retail growth in Brooklyn Park over the
past five years has been "tremendous;'
according to Soon Clark, deputy community
development director. The area near West
Broadway Avenue and Brooklyn Boulevard
is anchored by three shopping centers with
Bt like 'Target, Cub Foods and First
"We've taken care of much of our retail
needs in that period," Clark aeid. 'These
days it's fairly slow. The additional room for
growth — and what out residents say we
need now — are more traditional retail
stores like a coffee house, a Bruegger's
Bagel shop, movie theaters and a bookstore
and free- standing sit -down restaurant."
Like Its surrounding communities with
no more major development lots to offer,
Brooklyn Park is re- examining its tamil
strengths and looking at ways it can reinvest
m smaller neighborhood businesses in lieu
of developing bigger properties. While Clerk
and others say the city has some specialized
commercial concerns such as building recre-
ational areas like a golf course, more study
is currently going into "the next generation
of retail," including the development poten-
tial along Highway 610.
Ridley
Fridley has pretty much seen it all. So
much of it in fact that it's down to 89 acres
of vacant industrial property and 33 acres
programmed for class 'A' corporate office
space and supportive commercial services.
Wal -Mart built a large - format store in the
ewly'90s, Home Depot followed in 1995 on
a 14 -flare site and other commercial names
such as Slumberland have helped round out
Fridley's retail climate.
'The big news is a possible remodeling
of the Holiday Foods" at University Avenue
and Interstate 694, said Barbara Dacy, com-
munity development director.
Dacy notes that the area is fully devel-
oped compared to Blaine or Eden Prairie.
Fridley, like Brooklyn Park and Brooklyn
Center, is focusing on remodeling and site
improvements of existing retail areas. "Our
goal is to find redevelopment opportunities
that work, those that fit into neighborhoods
and that can enhance our tax base," she said.
Coon Rapids
Coon Rapids, like Elk Rivet and Blaine,
is enjoying a boom in retail development In
addition to neighboring Northtown Mail in
Blaine with its myriad stores running the
gamut from SportMart to Michael's Crafts, a
360,000- square-foot shopping cantor deval-
oped by Ryan Cos. called Riverdale
Commons is scheduled to begin in the near
future with storm like Target and Kohla, said
Lee Starr, the community development
director.
"We're getting our share of midlevel
hotels these days, too," he noted, including
Marriott, Carlson Country Suites and a
Holiday Inn. And movie theaters: two pro-
jects with 28 screens are moving forward.
"We've been under- screened for a long
time," said Starr.
Add to the movies and coffee a 190,000 -
square -foot community shopping center
with a large grocery and drug store on the
city's east side, recently approved by the city
and about to be built by the Robert Muir Co.,
and Coon Rapids, along with the others that
neighbor it, is poised to enter the next centu-
ry in a relatively expansive mode. ■
: May 16`1997 43
44 cltysuwnm�p 4`1997
ly Downtown Tax Increment District i
Robbinsdale, Minniesot
a
C
0 Redevelopment of
- Downtown Site
42nd and West 8 o edway
n
nin the rev Ulijaden ofDoivntaw
4
The Economic Developmeut Autbm* sede etem
GDO proposals for a 15,000 4 L Do.. d.
U
two bWWIW The MA is Open to dither rehab-muse cifdknolWon
and new dawlOPMeat, 14 d1ber case. the RDA destres reoor-,.,
restaurant uses In bullifiall(s) living a -Mula bar dgdp
Deadline for -51101110 Is 4:36 p L, June 2 A
Peons rho run mi&
bi have to be tough
But 5
r don't hwe to be
ugkr reach.
_J
7
11P 3-,
The singer the business the greater the mmaber of roles the
OVA=
OW top MMM9= base to Ild Ordinarily, this makes them a little
distracted,
But our Small Bytes EXTRA has . way of getting their
aftention. After all, its filled with information they can use. Not to
mention ads fmm =UP-i- that can help them get by a little
Ca us at 28S-2W tD reserve your ad.
PUSUCATION DATE: RESERVE SPACE BY.
FRIDAY, MAY 30, 1 "7 FRIDAY, MAY 16, 1 997
0 B PS—p.6 SOW
T he Business Jotirrlal
ai Y
288-2123..
ti
N
Business in the
Northwest
Metrn
A
.Q
In an effort to provide more insight into the �,
area, we asked community development'reiprejenta
three communities, Brooklyn Park C,60WR
to respond to surveys about their cities. Their,respa
a the northwest suburbs:*-.
mffffl�� * . `
What is the city's population?
"In
In Im. Miscellaneous
will oecurhududlng=t�_00�
.61,000
SI-P IM, hotal, and multt4aaant Odloo
What are the major local employers?
COUNtructed throughout the city t:
companies as W" Cos, AckqdXotlmn
Damark. 200 erqployees� Network
System, 500 employees; Siemens, 4o4
and Ryan Construction C os,
employees; County Sent, 358 employees;
He- do you ibinir take yow,-
Cgerpiltar Paying Products. 350 employ.
ees; Meyers Printing, 300 employees;
area to be fully developed? ;l%
20 Yew 4iaa ma
Avw- Cardiovascular, 200 employees
Which industries drive the local econo-
What's On Your community's wish Ilst to
terms of developments or hdkastn1"-,
MY? ,
The city has a strong balance between
inveshuntbythestate? .,
Economic assistance along t - he.!TA,610:
retail commercial, a diversified manufactur.
Ing base (emphasizing printing, packaging,
corridor to ensure the Idilbast and be y:
industrial
distributing and recent medical facilities)
and commercial USK
of efforts to maintain a prabusinesa dater
and education — this includes the public
school systems, community college and a
a proactive position to
Of T.H. 610 from TIRL 169 W
vocational institute.
MAPIO Grove to 1-94; to
P1n8w(t1t rite
What major developments have been
state, with the North;
Association to aacdhAtave
to uAchleve
completed recently or are pending In
your area?
al objectives,
The city has recently opened 190 acres
of land for development as pan of an
Economic Development Tax Increment
Financing District Utilities are being
tended into this area in June and develop-
ment will start late in 1997.
As pan of this new Economic
Development Tax Increment Financing
What Is the city's pop-1-flan?
District, OPUS Corp. has optioned for 50
=0 and has completed a Mager
Development
59,688 (most recent
Council estimate for April 1, 1993)
Agreement with the city-$
Economic Development Authority.
What are the.ingfor local ernptloyqr�741'jf'
Ryan Construction Cos. is in the process
of completing the development of 90 acres
Allina Mercy Medical Centir, - �t-P4
Honeywell, Commercial Flight SYS104411
of property in the Northinix! Industrial Park.
Coon Rapids medical center
lWOr tenants to date have included Avecor
:ardlovascular, Recovering Engineering,
'taln
Ramsey COMMM]hy CDII9V; Vincent,
Metal Goods; John Roberts Cm.
Industries, Dealers Manufacturing and
WO Multi-tenant buildings.
Ramsey TOO4.
Bay
In June T.H. 610 will start construct, .
h1c.
imn T.H. 252 westerly to T.H. 169. When
11timately completed this highway system
Which Ind
vill serve as a major thoroughfare connect-
r1g Interstate 35 to Interstate 94. This high-
MY?
Health cane, education printing, jeno... ., _1�
My will serve as a catalyst for continuing
space, wood products6 plastics, metals
tribution and fabrication, precision macld,_
Idustrial development and will greatly
ing
trengthen the overall economic, position of
�r
t major developments have been
Which industries drive the local e
Whietl recently or are pending In
my?
pi, ? . ;,.,. . ,
Comptetab Allies Heart Cotner (48;000
The manufacturing Industry is d
icant driver of Elk River's local ecc
sand "feet)] Comfort Lttt (56 sttlta), City
Twenty core manufacturers provide
ti
employment for about 1,500 peopb
y;:Gmean.Hay Packaging (204900
average pay range of $12 to $17 pe
uptofeet), Matrion- Fairfield inn (59
kpti)r'Home Depot (104,000 square feet),
What major developments have I
21V1irmnitme (175,000 egttera feet), John
completed recently or are pan &
keris Printing Addition (65,000 square
your area?
4) ;,LifedmeFitoess.(108,000square
A$1 million, 17,000-square-fix
a)oNmthtown Village shopping comer
trial facility constructed for 1,ePeb
BOAM square feet), Possis Medical
in Rail 10 Industrial Park; construc
0,000 equate feet), Vincent Meted Goods
90,000- square -foot single -use rend
t,
completion of Elk Park Center con
complex including Cub Foods and
Under conyWction. Couturiers Printing
for a total of 325,000 additional sq
944 square feat), ECM Publishing
of retail space; recently completed
2,000'sgdgw fi4 Holiday tan Express
square-foot construction of Sax Fo
3 a"& Outback Steakhtluse • '
Thug and 161,000 -square-foot Me
Approved; Anheuser -Busch distribution
4?f�°
e
b.the
f the
I von.
p j}
in
•
What Is the city's popnlation?
�'dlhe thy of Elk River's population at the
*d of 1996, was' approximately 15,000.
S rri
What ere rho t»ejgr local employers?
-Mg{or local employers include the fol-
ltxryng , United Power Association, 425
eropldyees-. Tescbm Corp., 331. employees;
Cisardian AnWjs of Elk'River, 236 employ -
ees; Target, 202 employees; Cub Foods,
200 employees; Alhool Manufacturing, 180
What Is on your community's v
terms of developments or hd m
investment by the state?
Elk River has a significant tta
struct a new ttansportadontutilith
in the eastern portion of our city.
portation corridor will provide of
for approximately 200 to 300 ads
acres of industrially zoned prope
Funding of this new mu sportedc
is a high priority in order to race
River's future needs for providin
al jobs for its residents and a div
base.
Funding of stank sewer and v
ties along this corridor is anothe
where the city may look to the s
Minnesota to provide a source o.
Ckyoudo tms May, 16 1997 . 45
t major developments have been
Which industries drive the local e
Whietl recently or are pending In
my?
pi, ? . ;,.,. . ,
Comptetab Allies Heart Cotner (48;000
The manufacturing Industry is d
icant driver of Elk River's local ecc
sand "feet)] Comfort Lttt (56 sttlta), City
Twenty core manufacturers provide
Co6a'Rapids City center (16000 square
employment for about 1,500 peopb
y;:Gmean.Hay Packaging (204900
average pay range of $12 to $17 pe
uptofeet), Matrion- Fairfield inn (59
kpti)r'Home Depot (104,000 square feet),
What major developments have I
21V1irmnitme (175,000 egttera feet), John
completed recently or are pan &
keris Printing Addition (65,000 square
your area?
4) ;,LifedmeFitoess.(108,000square
A$1 million, 17,000-square-fix
a)oNmthtown Village shopping comer
trial facility constructed for 1,ePeb
BOAM square feet), Possis Medical
in Rail 10 Industrial Park; construc
0,000 equate feet), Vincent Meted Goods
90,000- square -foot single -use rend
78,000 square feet), YMCA (68,000
completion of Elk Park Center con
complex including Cub Foods and
Under conyWction. Couturiers Printing
for a total of 325,000 additional sq
944 square feat), ECM Publishing
of retail space; recently completed
2,000'sgdgw fi4 Holiday tan Express
square-foot construction of Sax Fo
3 a"& Outback Steakhtluse • '
Thug and 161,000 -square-foot Me
Approved; Anheuser -Busch distribution
construction of a 45,000- square-fo
eater (145,800 equate feet), Cineplex
ution/warehouse facility for expan
&on Theaters (12 screens), Kerasotes
existing business.
&ftwrs *(16 screens), Frito-Lay
Pendingtfuture development im
hfiibution Center (48,000 slluare feet),
15,000 - square -foot expansion of a
lei" ekpansioti (44,300 square feet) .
business in the Elk River Indushia
foaidale commons shopping center
70-acre commercial/industrial dev
Ml,000 square feet); Quality Stetllization
at the corner of Highway 169 and
00ces (27,800 square feet) ,
Street; a 280 -acre residential dove
C. >,: �•,a-
in east Elk River —homes atana
fort long do you think it will take Coon
price of approximately $150,000 -
;a 6 to be folly developed?
construction of 30,000- square-foo
*' ls.tmtidpated lhb city will be fully
tenant industrial facility; construct
OOd,p d,by.2014�
d
60,000 -square-foot facility for Mi
Sports Federation; 40,000- squaw-
�t "a dti'yoh2 d'elsh list B►
hotelfrestaumnt project (future).
Bettis of development or Infrastructure
by.the state?
How long do you think it will to
Highway 10, north of
area to be fully developed?
STImpmvamenta-.to
eHighway 10 improvements currently
There is enough vacant land a,
txttlsnuctloa ` '
take Elk River well beyond its cm
a� - --
year comprehensive plan.
•
What Is the city's popnlation?
�'dlhe thy of Elk River's population at the
*d of 1996, was' approximately 15,000.
S rri
What ere rho t»ejgr local employers?
-Mg{or local employers include the fol-
ltxryng , United Power Association, 425
eropldyees-. Tescbm Corp., 331. employees;
Cisardian AnWjs of Elk'River, 236 employ -
ees; Target, 202 employees; Cub Foods,
200 employees; Alhool Manufacturing, 180
What Is on your community's v
terms of developments or hd m
investment by the state?
Elk River has a significant tta
struct a new ttansportadontutilith
in the eastern portion of our city.
portation corridor will provide of
for approximately 200 to 300 ads
acres of industrially zoned prope
Funding of this new mu sportedc
is a high priority in order to race
River's future needs for providin
al jobs for its residents and a div
base.
Funding of stank sewer and v
ties along this corridor is anothe
where the city may look to the s
Minnesota to provide a source o.
Ckyoudo tms May, 16 1997 . 45
SS
s d workerslat't
77
he United D
to industry. Ty the future ]
M artillery system that is one
lg
,l
4 k le
�i
11A�1 A,
�eb
ery `
topes:
se
Fred Strader, dhdek
[ant near the "` troci4 direetm of s
teen a Twin 1' Defense plant In Fd
years. It has s
them Pump,
ease — or to
ved with the
t swelled to
I,Aen the
(e oae of the
eNavy'S blessing"
4 owns 40
"Because [order] volumes
ntract also
The CAWdmNd tofiieI
f chance to
swffAodvqmmtfmwesent
production
men
�ected to be
fly
tough Fred
do the electronics. The altems
ad general
thing.
FMC's defense op retions.fa
the Fridley plant for three.
success of a
United Defense was one of tl
tegy for the
- Hdatlotm."
;traditional
It shtco has been joined 6y
[ wArmy as
1993,.whetrthe Pentagon beg
from being
for defense- Industry conao dt
er to an en-
there have been more than 2
[e.And,wlth
Peat.•
among d nsecontractors.I
Tense
Wative rela-
announced deals
Bon, including Boeing's $14 1
'
chase of McDoanell Douglas C
And contractors that' efen
t
e times. It's
cooperating In neW wwaayyss
Suadat cited Navy mlasUe I
WC Corp.,
used to . produced by bolt
dley plant
and Lockheed Mardn
HBI P
.
efettse and
eNavy'S blessing"
4 owns 40
"Because [order] volumes
]ion, one of
Navy decided It made sense I
dquartered
ourselves to form a cooperatle
dsville, Ky.,
said. "With the Navy's bless
=Thework
— we do the mechanical
forma. The
do the electronics. The altems
O'mtilion.
us is out a f the business."
le business
Ztian
7Wm to CRUSADER on D4
a'beeps
with
S'e
ring up more
plans changes . I
esentatives' _
160 are independent con -_ r A
n ui Fndley have been fighting'to` sure%
b ter, thanks in large part to a $1 billign;'l
n
,,stop priorities for modernization.
z:
tii ' r
NNW x1igarmralmmmgm , Min HeUIeWMW Auto Wo*m localwowon6AndArlenYYR �S
$01 end 1XIM MI211mm, have worked with downsldng eM ommoad t isNlsa anti¢ IknlOed e j
I.UY ere Pkft theh hopes o n fie AnWa unmade Datd wOWy projoo ."
. The changing face of United Drfense, . � - p
1982 was the post-World War U peak empl pnw h ta
UnbdDefenseplant fotmeg FMC COry, In the it
vu74 M7J `�
> Biggest customm U.S Navy
> Primary pod" :. Mark motel
and Mark 26 missile 'system for the Army
launching systems
> Totel e mpkyeas 4 100 t
1,500 � ••��' -r "`�a
> United Auto Work• 2800 0 450y A0�
W.. e mllm maindecta-
re
bng empbyeea Sv
a; s Egnghnees 30o to 400 TOO, plus 100. myl
inmate, gel "tfj
A wNhfully > Buelne� ownarehip FMC Corp UnitedD9le�se yJehU�
-ti' dy Wre .Of FM¢
'
¢' and la the tpaitaBing a .
:ars'and at vier Hardoocwnsg4tpnr
aurh con-
and
Pty
tand �^
note. Since awarded N ahoutduee ye$e is d to operategimam
rlous push
save costs, Sauce United Defense Y
le_ mergers,
,r� ��,y, k
F alone pde• dollars m e• fhafotm`OandLF,�4 r
-
ag $40 bU .' r rr
stock ur. , r "i
binhtg are : for Harsoo Coqµ Janes tease t fotm'Ut �' ° '
example, a Defense,The has
its, which its focus from
p meMeahalrngto S
Defense naerhrg and system tain deYebpmgnW �,�.�{ � ,�t jyy
In b®otm of oott�mtt 190 donate
were down, the 300
or.,l:pckheed and 250
n'agreement," he 200
Z& we split the
eme`endthey 15D
eve is that one of 1000
D 'as '8a '64 '66'Sa 'e'r 'ss 'ba 90 T%1 11213 'o
Source: US office of Mwftement and ataget
lies of class rings, schooll�
[an, vice president ^of corporate NOW Dh
e biiiness communications, veteral
"Our research showed that aturateac;
Vid Adpi8 there was some confusion among take am
r - °' consumers he sa'.d. 'We believe the Ceiba
cz
uj
z
17
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fic 11 0 1 m -8 L-0 101
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06/12/97 THU 16:53 FAX 612 885 5969 KRASS MONROE
A s s
MONRUE
KRASS 110-'AOE, r.A
■ James R Casserly 'ATTORNEYS Ax LAMP.
Diced D&4 (612) 88512296
FA,CSIlVQI,E COVE)Lt S + �T
Date: Z
-►-+ -+ FRIDLEY R001
THE INFORMATION CONTAINED IN THIS FACSIMILE MESSAGE AND IN THE ACCOMPANYING DOCUMENTS IS CONFIDENTIAL AND
PRIVILEGED AS ATTORNEY- CLIENT COMMUNICATION. IT IS INTENDED ONLY FOR THE USE OF THE RECIPIENT NAMED BLOW.
IF YOU ARE NOT THE INTENDED RECIPIENT, OR THE EMPLOYEE OR AGENT RESPONSIBLE TO DELIVER THIS MESSAGE TO THE
INTENDED RECIPIENT, YOU ARE HEREBY NOTIFIED THAT ANY DISCLOSURE, COPYING, OR DISTRIBUTION OF THE CONTENTS OF
TNIS TRANSMISSION IS STRICTLY PROHIBITED. IF YOU HAVE RECEIVED THIS FAX IN ERROR, PLEASE NOTIFY US IMMEDIATELY
BY TELEPHONE TO ARRANGE FOR RETURN OF THE ORIGINAL DOCUMENTS TO US.
To: q: � ctc Fax No:
From: DAMES R. CASSERLY Our File No.
Re: IVOCC ` 5
Also to be sent by Mail: Yes ✓No
W42 vVo-J 40
Please call (612) 885 -1298 if X pages are not received (Including cover),
b
m
SUTIE 1100 SOUTHPOLNT OFFICE CENTER - 1650 WEST 87.ND STREET • BLOONIINGTON, MU4NESOTA 55431 -1447
TELEPSON$ 612=5 -5999 • FACSEWLE 612/885.5969
06/12/97 THU 16:53 FAX 612 885 5969 KR9SS MONROE -►a-► FRIDLEY
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE
CITY OF FRIDLEY
COUNTY OF ANOKA
STATE OF MINNESOTA
RESOLUTION NO.
A RESOLUTION AUTHORIZING AN EXTENSION OF TIME FOR THE
bELIVERY OF A CONTRACT FOR PRIVATE REDEV
HOUSING AND REDEVELOPMENT AUTHORI EN THE
TY IN AND ELOPMENT BY AND BETWE FOR THE CITY FRIDLEY AND
NOAH'S ARK OF MINNESOTA, INC.
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 "Authorityn) as follows:
Section 1. Reels
1.01. The Authority has authorized on March 13, 1997, the
execution and delivery of a Contract For Private Redevelopment (the
"Contract ") with Noah,s Ark of Minnesota, Inc. (the "Redeveloper").
1.02. The Authority's Resolution of March 13, 1997,
required that certain conditions be met by July 1, 1997.
Section 2. Fin_ d g.
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 Eta` tom, Section 469.001 At sear,
2.02. The Authority hereby finds that the Contract
promotes the objectives as outlined in its Redevelopment Program.
2.03 The Redeveloper requires
September 1, 1997 to secure the fnancing fortthelprojectlme to
contemplated by the Contract.
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
if the following conditions are met by September 1, 1997:
I. Substantial conformance of a Contract to the Contract
presented to the Authority as of this date; and
2. A final approval by the City of Fridley of a housing
revenue bond to finance the project described in the Contract.
la 002
L 08/12/97 T$U 16:54 FAX 812 885 5969 BRASS MONROE FRIDLEY R] 003
Page 2 -- Resolution No.
i
Adopted by the Board of Commissioners of the Authority this
day of 199
Chairman
ATTEST:
Executive Director
Date: June 12, 1997
To: HRA Commission Members
From: Craig Ellestad, Accountant
Subject: Additional Expenses Needing Approval
VENDOR
Frederic Knaak
Krass Monroe
Plastics to Go
File:\EXDATA\H RA\MISCW DD- EXP.)ds
DESCRIPTION
Legal Expenses - Various
Legal Expenses - Various
Plastic brochure holder.
AMOUNT
1,214.00
7,336.42
98.51
Total : $6,645-93
■ James R Casserly
Direct Dial• (612) 885-1296
KRASS
MONROE
KRASS MONROE, P.A.
- ATTORttEYS AT LAW -
MEMORANDUM
TO: Fridley Housing and Redevelopment Authority
l Burns, Executive Director
Barbara Dacy, Community Development Director
FROM: James R. Casserly
RE: Resolution for the Payment of Prevailing Wages
Our File No. 9571 -12
DATE: June 5, 1997
M
i
Attached you will find a Resolution for the HRA regarding the payment of Prevailing Wages.
I have modeled this after Resolution 97 -38 adopted by the City to implement .Ordinance
1095.
The Resolution simply implements the Prevailing Wage Ordinance for the Authority. In an
attempt to eliminate any confusion, I have attached a copy of the Ordinance to the HRA
Resolution. If there are any questions or problems, please give me a call.
JRC /kh
Encl
FTMLEYMCOMM7
SUITE 1100 SOUTHPOINT OFFICE CENTER - 1650 WEST 82ND STREET - BLOOMINGTON, MINNESOTA 55431-1447
TELEPHONE 612/885.5999 - FACSIMILE 612/885.5969
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE
CITY OF FRIDLEY
COUNTY OF ANOKA
STATE OF MINNESOTA
RESOLUTION NO.
A RESOLUTION OF THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR
THE CITY OF FRIDLEY, MINNESOTA, FOR THE ADOPTION OF A POLICY AND
CONTRACT LANGUAGE IMPLEMENTING THE PROVISIONS OF ORDINANCE NO. 1095,
PROVIDING FOR THE PAYMENT OF PREVAILING WAGES ON CERTAIN PROJECTS
AND CONTRACTS WITHIN THE CITY
BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the
Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority ")
as follows:
Section 1. Recitals.
1.01. The City of Fridley, Minnesota (the "City "), has adopted a certain Ordinance,
Number 1095 (the "Ordinance "), providing for the payment of the prevailing wage to workers
within the City under certain specified conditions and circumstances, which Ordinance is attached
as Exhibit A to this Resolution.
1.02. The City has adopted Resolution No. 97-38 implementing the provisions of
Ordinance No. 1095.
1.03. The Authority wishes to provide specific guidance to the public and its own
employees, as well as contractors and others doing or wanting to do business with or in the City,
as to how it expects the Ordinance to be implemented in contracts and work governed by the
Ordinance.
Section 2. Adoption of Polic y for Payment of Prevailing W_ ages.
2.01 The Authority adopts as its policy concerning all bids and contracts
governed by the Ordinance that the following language, either fully or by express reference to the
Ordinance and this Resolution, shall be included in all such bids and contracts, and that this same
language shall operate as the ongoing policy of the Authority with respect to any such bids and
contracts:
The Contractor agrees that the Contractor's laborers and mechanics and any
subcontractor's, of any tier, laborers and mechanics who work on this project and who fall within
Resolution No. , Page 2
any job classification established and published by the Minnesota Department of Labor and
Industry shall be paid, at a minimum, the prevailing wage rates as certified by said Department.
Each Contractor and subcontractor of any tier performing work on this project shall post on the
project the applicable prevailing wage rates and hourly basic rates of pay for the County or area
within which the project is being performed, including the effective date of any changes thereof,
in at least one conspicuous place for the information of the employees working on the project.
The information so posted shall include a breakdown of contributions for health and welfare
benefits, vacation, benefits, pension benefits and any other economic benefit required to be paid.
Definition.
The definition of "laborer" and "mechanic" used in connection with prevailing wages shall
be that definition contained in 29CFR Part 5.2(m).
2. Submission of Payroll.
a. Upon request of the Authority, the contractor and subcontractors, if any, shall
submit to the Authority weekly for each week in which any contract work is
performed, a copy of all payrolls. The payroll submitted shall set out accurately
and completely all the information required to be maintained under Section
5.5(a)(3)(I) of regulations, 29CFR Part 5.
b. Each payroll submitted shall be accompanied by a "Statement of Compliance"
signed by the contractor or subcontractor or their agent who supervises the
payment of the persons employed under the contract and shall certify the
following:
(1) That the payroll for the payroll period contains information of the type
required to be maintained under Section 5.5(a)(3) of regulation 29CFR Part
5, and that such information is correct and complete.
(2) That each laborer or mechanic (including each helper, apprentice and
trainee) employed on the contract during the payroll period has been paid
the full weekly wages earned, without rebate, either directly or indirectly,
and that no deductions have been made either directly or indirectly from the
full wages earned.
(3) That each laborer or mechanic has been paid not less than the applicable
wage rates and fringe benefits or cash equivalent for the classification of
work performed as specified in the applicable wage determination
incorporated into the contract.
Resoltution No. , Page 3
(4) The contractor or subcontractor shall make the records required under this
paragraph available for inspection, copying or transcription by the Authority
and shall permit the Authority to interview employees during working hours
on the job. If the contractor or subcontractor fails to submit the required
records and make them available, the Authority may, after written notice to
the contractor, take such action as may be necessary to cause the suspension
of further payments, advance, or guarantee of funds.
3. Violation: Liabilily for Unpaid Wages.
In the event of any violation by the contractor or subcontractor relating to the prevailing
wage provision in this contract, the contractor shall be liable for the unpaid wages.
4. Withholding of Unpaid Wes.
The Authority may, upon its own action, withhold or cause to be withheld from any
monies payable on account of work performed by the contractor or any subcontractor such sums
as the Authority may determine to be necessary to satisfy any liabilities of such contractor or
subcontractor for any unpaid wages as required herein.
5. Fringe Benefits.
The Contractor and subcontractor shall pay fringe benefits in the manner and in
accordance with the 1964 amendments to the Davis -Bacon Act (Public Law 88 -349) and the
implementing regulations contained in 29CFR, Subpart B, 5.20, et seq.
6. Liquidated Damages.
If the Contractor or any subcontractor of any tier does not pay its laborers and mechanics
prevailing wages as provided herein, the Contractor shall be liable to and pay to the Authority, as
liquidated damages, as sum equal to five percent (5 %) of the contract amount. The Authority
may deduct any money due or coming due to the Contractor such sums as the Authority may
determine to be necessary to satisfy any liability of the Contractor to pay liquidated damages as
provided herein. Any monies collected or deducted are not to be construed as penalty but as
liquidated damages to compensate the Authority for the Contractor's and/or subcontractor's
failure to pay prevailing wages. The rights and remedies provided for in these specifications shall
be in addition to and not a limitation of any rights or remedies otherwise available at law. In any
lawsuit involving assessment or recovery of liquidated damages, the reasonableness of the charges
therefore shall be presumed, and the amount assessed shall be in addition to every other remedy
now or hereinafter enforceable at law, in equity, by statute or under contract.
Resolution No. , Page 4
7. Termination of Contract.
A violation of any of the above - stated provisions in a contract governed by the Ordinance
shall constitute a substantial breach of that contract and shall constitute ground for termination.
Adopted by the Board of Commissioners of the Authority this day of
199.
Larry R. Commers, Chairman
ATTEST:
William W. Burns, Executive Director,
ORDINANCE NO. 1095
AN ORDINANCE OF THE CITY OF FRIDLEY, MINNESOTA, ADOPTING THE
PREVAILING HOURS OF LABOR AND PREVAILING WAGE RATE ON CERTAIN
PROJECTS FOR OR WITHIN THE CITY
The City Council of the City of Fridley does ordain as follows:
Subdivision 1 Legislative Findings. The City of Fridley finds it to
be in the best interest of its citizens that buildings and public works
projects constructed with City funds be constructed and maintained by the
best means and highest quality of labor reasonably available, and that
persons working under contract on buildings and public works projects
constructed in whole or in part with City-funds should be compensated
according to the real value of the services they perform, which for
purposes of this ordinance, is defined as the prevailing wage and hours
of employment as determined for the City by the Minnesota Department of
Labor and Industry, pursuant to Minnesota Statutes, Section 177.42,
subd. 6.
Subdivision --2. Prevailing Wage and Hours on Certain City - Related or
Funded Projects.
a. Wages paid for all work performed by contractors and
subcontractors that is financed in whole or in part by funds
obtained by bonds issued by the City, including but not
limited to Industrial Revenue Bonds, and all projects let
after May 1, 1997, financed by General Obligation Tax
Increment Bonds shall be paid in accordance with the
prevailing wage and hourly rate.
b. Wages paid for all work performed by contractors and
subcontractors on any project let after May 1, 1997, that is
financed in whole or in part by City funds shall be paid in
accordance with the prevailing wage and hourly rate.
C. Wages paid for all work performed on any project for a
Developer in conjunction with the Developer's development of
real property in the City if the Developer purchases said real
property from the City, or if the City grants or loans money
to the Developer for the development of said real property,
shall be in accordance with the prevailing wage and hourly
rate.
d. The term "City" shall refer to the City of Fridley and to all
related agencies, including, but not limited to all Housing
and Redevelopment Authorities and Economic Development
Authorities created by the City of Fridley.
Page 2 - -- ORDINANCE NO. 1095
Subdivision 3. Exceptions. This ordinance shall not apply to the
following circumstances:
a. Any project financed by City funds or bonds authorized by the
City as provided in Subdivision 2 that has a value of
$25,000.00 or less or a value equal to or less than the amount
required for sealed bids by Minnesota Statutes, Section
471.345, subd. 3.
b. Any housing project or program within the City directed to or
marketed for owner occupancy; or
C. Any housing project or program directed at rental units
containing eight or fewer units; or
d. Any residential rehabilitation project, regardless of size,
entirely paid for with non -City funds.
PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 5TH
DAY OF MAY, 1997.
NANCY J. JORGENSON - MAYOR
ATTEST:
WILLIAM A. CHAMPA - CITY CLERK
First Reading: March 31, 1997
Second Reading: May 5, 1997
Publication: May 15, 1997
KRASS
MONROE
KRASS MONROE, P.A.
■ James R Casserly • ATTORNEYS AT LAW
Direct Dial (612) 885-1296
MEMORANDUM
TO: Fridley Housing and Redevelopment Authority
Larry Commers, Chairman
,,Biel Burns, Executive Director
Barbara Dacy, Community Development Director
LeVander, Gillen & Miller
Attn: Kenneth J. Rohlf, Esq.
Linn Property Holdings
Attn: Stephen L. Linn
FROM: James R. Ca5serly
RE: June 4, 1997 Draft of the Contract for Private Redevelopment By and Between the
Housing and Redevelopment Authority in and for the City of Fridley, Minnesota
and Linn Property Holdings, L.L.C.
Our File No. 9571 -7
DATE: June 5, 1997
Enclosed each of you will find a blacklined copy of the above draft. In addition, Barbara
Dacy will find a draft which incorporates the changes. This latter version is the one that
should be used in the HRA packages.
I have tried to incorporate all of Kenneth Rohlf's suggestions, except those involving an
assignment of the Contract. I have tried to make it clear in Section 6.4 that an assignment
will be acceptable. This issue generally dealt with in a subordination agreement, which
typically contains an assignment of the Contract for Private Redevelopment. Lender or
Lender's counsel should be sending me a form for the Consent and Subordination
Agreement.
SUITE 1100 SOUTHPOINT OFFICE CENTER - 1650 WEST 82ND STREET - BLOOMINGTON, MINNESOTA 55431 -1447
TELEPHONE 612/885.5999 - FACSIMILE 612/885.5969
The issue of the Repayment Amount, which is the subject of my memo of May 29, 1997 has
been incorporated and is reflected in the Note (see pages 27 -28) and in the Authority
Mortgage (see pages 37 -39). Again, please review these provisions carefully to make sure
they reflect the business terms upon which we have agreed. Any changes or suggestions
should simply be marked up on the appropriate pages and faxed back to me.
If this draft is acceptable to everyone, I will prepare execution copies and send out signature
pages. I do need a legal description of the redevelopment property. Possibly Ken Rohlf
would have that available. Again, thank you for your cooperation in these matters.
JRC /kh
Encl
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