HRA 11/13/1997 - 6282HOUSING & REDEVELOPMENT AUTHORITY MEETING
THURSDAY, NOVEMBER 13, 1997
7:30 P.M.
WILLIAM BURNS
EXECUTIVE DIRECTOR OF HRA
CITY OF FRIDLEY
HOUSING & REDEVELOPMENT AUTHORITY MEETING
THURSDAY, NOVEMBER 13, 1997 7:30 P.M.
AGENDA
LOCATION: Council Chambers (upper level), Fridley Municipal Center
CALL TO ORDER
ROLL CALL
APPROVAL OF MINUTES: October 9, 1997
CONSENT AGENDA:
Authorize Execution of Consent to Assignment and ............. 1 - 1 K
Acknowledgment, Columbia Park Properties
Consider Acquisition of 1545 - 75 h Avenue N.E . ............... 2-2E
Resolution Certifying Parcels for Phase II of the ................ 3-3K
Housing Replacement Program
Revenue and Expenses .... ............................... 4-4C
ACTION ITEMS:
Resolution Authorizing Execution of Second ................... 5 - 5R
Amendment to Contract for Exclusive Negotiations,
MEPC American Properties
Resolution Considering Policy for Subordination ............... 6-6D
Agreements for Housing Loan Program
INFORMATION ITEMS:
Participation in Minnesota Solutions Redevelopment ............ 7-7E
Initiative
Monthly Housing Report .... ............................... 8 - 8A
OTHER BUSINESS:
ADJOURNMENT
CITY OF FRIDLEY
HOUSING AND REDEVELOPMENT AUTHORITY MEETING
OCTOBER 9, 1997
Chairperson Comers called the October 9, 1997 Housing and
Redevelopment Authority meeting to order at 7:48 p.m.
ROLL CALL:
Members Present: Larry Commers, Virginia Schnabel, John Meyer
Members Absent: Jim McFarland, Duane Prairie
Others Present: William Burns, Executive Director
Barbara Dacy, Community Development Director
Jim Casserly, Financial Consultant
Craig Ellestad, Accountant
Richard Pribyl, Finance Director /Treasurer
Grant Fernelius, Housing Coordinator
Margaret Metzdorff, Remodeling Advisor
Craig Christensen, Semper Development
John Kohler, Semper Development
Leslie Jowett, MEPC American Properties
Dave Jellison, MEPC American Properties
Dennis Homel, Moore Lake Apartments
Norma Swanson, Theisen B. Partnership
Art Swanson, Theisen B. Partnership
Ellen Beeche, Semper Development
Jerry Paschke, Paschke Properties
William Hogan, 3165 Mississippi Street
MOTION by Mr. Meyer, seconded by Ms. Schnabel, to approve the
August 14, 1997, Housing and Redevelopment Authority minutes as
written.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
CONSENT AGENDA:
1. REVENUE AND EXPENSES
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the
Consent Agenda.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
ACTION ITEMS•
• �• Z- • . •.
Mr. Jellison provided an update of the master plan for the 1
Fridley Executive Center site and the status of the pending
contacts. This master plan has been switched to 100,000 square
feet of office service space. Pent Air Corporation was still in
the plan as they have reconsidered the Fridley Campus. Pent Air
Corporation is also looking at an existing building in Arden
Hills. The original plan for Pent Air included the plan areas 4,
5 & 6. With City approval, number 5 is a 60,000 square foot
corporate office space. Space 6 is a restaurant. Both fit the
parking ratios and land requirements of the site. The Hilton
Corp looking as a possible hotel site which would be similar to a
Hampton Inn concept, a business quality hotel. A representative
from Hilton was here today to look at the site.
Ms. Schnabel asked Mr. Jellison to identify what numbers 4 5 & 6
are.
Mr. Jellison stated number 4 of the original plan is a possible
restaurant site. Number 5 is a prototype Hampton Inn. Number 6
of the plan includes a bank with drive up tellers and second
floor office facility.
Ms. Schnabel asked, "Under the new proposal there wouldn't be a
restaurant ?"
Mr. Jellison stated, "If Pent Air comes back and says this is our
first choice. We left this open, that the Fridley HRA would have
to approve the office portion. If we shift Pent Air to number 3,
HOUSING & REDEVELOPMENT AUTHORITY MTG. OCTOBER 9. 1997 PAGE 3
you would still have other options open. We originally came with
them going on site 1 but they didn't want to put their corporate
headquarters on the far end of the site.
Chairperson Commers asked about the status of MEPC as a result of
the news of MEPC selling its United States portfolio.
Mr. Jellison reported, presently MEPC is going to spin off
operating groups of Australia and US. We are part of a billion
to 1.2 billion dollars which will continue to operate, as two
separate operating companies. Presently the US and Australia are
30% of the net asset of MEPC but 50% of its income. London has
not been doing the same as they have experienced a slower
turnaround. Our plans are to continue business as usual. We
have 250 million in development right now. All our funding is
held in the US operation.
Chairperson Commers asked will there be a new owner of MEPC? We
don't know what their philosophy is or what they will want to do?
Will you continue to develop the 6000 tower?
Mr. Jellison reported there were 6 buildings sold. Everything
that was not redevelopable, that was at its maximum value was
determined to be sold off. We have just finalized all the
bidding of the new 6000 tower. I can't tell you what our entity
will be when it is all done. We have a number of capital sources
that would like to keep the management team in place. The Colony
3 is a 385,000 sq. ft tower already under construction. We are
operating business as usual. If Pent Air says we are ready to
go, we are ready to proceed also. Pent Air would be a tenant to
lease the building as well as the tech -plan.
Chairperson Commers stated, "When we entered into the deal with
you we did so after looking at how you manage your property. If
we anticipate a different management, it may have an effect on
how we think about the plan."
Mr. Jellison stated we are fortunate that we receive many calls
stating tenants would like to get back into a MEPC building. We
plan to continue to operate as we always have. However, I can't
guarantee you that nothing will change. There aren't many
companies that have been in the US for 20 years that have only
sold 6 buildings out of the size portfolio that we manage. We
can't buy real estate because there is so much demand, it only
makes sense for us to develop. Everything we have developed in
D
HOUSING & REDEVELOPMENT AUTHORITY MTG. OCTOBER 9. 1997 PAGE 4
High Tech facilities have leased out very quickly.
Ms. Schnabel asked when will he have the High Tech proposal
Mr. Jellison reported he will have a site plan in approximately
2.5 weeks. Landscape and elevations will be ready shortly
thereafter. There will be glass all the way around the front of
the building, with 16 foot clear. The back area would be the
service door area. One door for shipping, one for receiving,
trash etc stored inside the building. A great image with a great
location. The difficulty is to build a building with 5 parking
stalls per thousand if it is all office. If it goes 50% high
tech and 50% office we need to accommodate the truck
requirements. We will look at 2 -3 different size tenants as well
to see if we can meet all these needs before building.
Ms. Schnabel asked what is the anticipated construction date?
Mr. Jellison replied we would try to start construction this
winter and blacktop in the spring.
Mr. Meyer stated that the MEPC news would have a chilling effect
on those looking at the High Tech site.
Mr. Jellison doesn't anticipate any negative feedback. A billion
and a half dollar real estate corporation with very little debt,
there aren't many of us around. Many buildings have been turned
back to insurance companies and financiers. MEPC has not had any
concerns raised from its tenants. Is it disturbing for us, yes.
Many people have gone through change for example 3M and the
Imation spin -off. MEPC has been sheltered but Mr. Jellison does
trust the MEPC management. In the long run we will continue to
do business as before. We have had many opportunities to buy
office buildings in other parts of the US but with the slower
results in the UK, we were not able. Mr. Jellison is not afraid
of the new MEPC. Think of real estate trusts, most want to get
to 1 billion dollar mark to justify themselves. MEPC is already
over 1 billion and Mr. Jellison doesn't see MEPC losing any
management people.
Mr. Burns asked Mr. Jellison to speculate, who are you talking
about purchasing MEPC, national companies or perhaps Twin City
companies.
Mr. Jellison stated we are talking about financial institutions
that would like to participate. National or Twin City companies
are probably too small to participate. We are not likely to
become part of OPUS, for example. We may become part of a major
financial institution.
3. REQUEST FOR LETTER OF SUPPORT FOR MHFA APPLICATION: DENNIS
•E
Mr. Fernelius stated Mr. Homel has a purchase agreement to buy
the Moore Lake Apartments, a 64 unit complex located at 5701
Central Avenue and 995 Lynde Drive. The current owners want to
sell the property and do not want to invest additional money into
the property. The $1.625 million sale is contingent upon
Minnesota Housing Finance Agency (MHFA) financing for both a
first mortgage to acquire the property and a second, deferred
mortgage to make substantial improvements to the buildings and
grounds. The Anoka County Assessor has the property valued at
$682,328.
Purchase Price $1,625,000
Rehabilitation 689,080
Financing and Carrying Fees 31,394
Misc. Fees 23,200
Total Uses $2,368,674
SOURCES
MHFA 1st Mortgage $1,397,423
MHFA ARIF Loan 300,000
MHFA Incentive Loan 480,000
Owner Equity 191,251
Total Sources $2,368,674
The plans include roof replacement, windows, boilers and water
heater replacements, siding, regrading around the perimeter of
the building, and upgrading units. 75 %of the units are required
to be maintained as affordable housing with a 1 bedroom unit
renting at $458 and a 3 bedroom at $ 705.
Mr. Fernelius stated Mr. Homel does have a pretty good track
record with a project similar to this one in Anoka and one in St
Paul. Mr. Fernelius visited the Anoka project and the City
reported positively on the project. The letter requested is to
HOUSING & REDEVELOPMENT AUTHORITY MTG. OCTOBER 9. 1997 PAGE 6
support his deferred loan application
Ms. Schnabel asked, at this point the HRA has not been asked to
contribute funds to this project?
No, Mr. Fernelius stated with regard to HRA financing, the owner
could apply for the Last Resort Rental Loan Program should MHFA
be unable to fund his entire deferred loan request of $300,000
but we are not committing dollars this evening.
Ms. Schnabel asked how does the HRA become involved in writing
this letter and will the City Council also show their support?
Mr. Fernelius stated it is a typical requirement showing support
of the project.
Ms. Dacy added the MFHA likes to see if the City supports the
concept of the project.
In this case the Council will not review the issue at this time.
This is a housing issue so it is referred to the HRA.
Chairperson Commers suggested staff refresh our memory about the
last resort program and report back at a future meeting.
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve and
authorize Mr. Burns to draft a letter showing support to Mr.
Homel's MHFA application in the rehabilitation of the Moore Lake
Apartments.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
a I WS .•-• • - - •.�
EM, FIRMWI. IM -- i
Ms. Dacy presented a review of a plan proposed by Walgreens at
the Northeast Corner of University Avenue & Mississippi Street.
The area consists of 2 single family homes and an existing
building located on 3.13 acres. In 1991, a multi - tenant plan
was approved. This first proposal included a Burger King drive
through around the building and a Walgreens pick up window as
well. This plan was 27,745 square feet, however, the plan did
not proceed. A second plan by Wagner Development was 1,000
square feet less.
HOUSING & REDEVELOPMENT AUTHORITY MTG. OCTOBER 9 1997 PAGE 7
Ms. Dacy stated the current proposal is a freestanding 13,905
square foot Walgreens building on 2.88 acres. The face brick
exterior has stucco accents with the entrance oriented toward the
intersection. This proposal does not include one of the two
single family lots. There is a full movement access area and a
right -in right -out drive west of the entrance. A pick up window
is included on the east side of the building. A detention pond
is proposed on the rear side of the building. The basis for
review is that the property is zoned S -2, Redevelopment District
which requires review not only by the Planning Commission and the
City Council, but also by the HRA. The intent is to allow for
mixed use development, maximum flexibility and determination of
the most appropriate plan for the best interest of the City. The
requested action is to change the 1991 plan to the proposed,
single entity and smaller building. The site is located in Center
City TIF District #1. The purpose of the district is to
accomplish a redevelopment project which better utilizes vacant
land, increases tax base and promotes proper use of plan. Staff
concerns are under utilized areas in the site. There is a lot of
land area used for parking, asphalt for the drive - through use
dictating the building be located in the center of the site. It
is possible to have the siltation and detention requirements
located underground. This is a single use versus a variety of
commercial uses. Walgreens has had very good success with this
type of approach with the pick up window. It is a smaller
project and there are advantages to having a smaller project as
there is more green area. The City should revisit the vision.
The Planning Commission will review the plan on October 15. The
City Council will review on October 27th. There is a 60 day
deadline of Nov. 11th.
Staff recommends denial of the revision.
Chairperson Commers asked about the western driveway. Is this
practical?
Ms. Dacy stated staff does not recommend approving the location
of the driveway as proposed based on the traffic analysis done 5
to 6 years ago. We are concerned this could cause additional
interruption. The area between the driveway and the intersection
is not appropriate.
Ms. Dacy also stated the tax increment of $13,000 was an early
estimate. Based on information given by petitioner, the
HOUSING & REDEVELOPMENT AUTHORITY MTG. OCTOBER 9 1997 PAGE 8
increment is actually $23,000 - $24,000. Walgreens is also
proposing to do the acquisition and demolition.
Mr. Commers asked originally did we talk of taking another
eastern property on Mississippi Street?
Ms. Dacy stated early in the process that was correct. When the
plan was approved Anoka County was ok with the driveway location
as proposed. This plan includes the first house on Mississippi
and then the house directly behind it on 66th.
Craig Christensen with Semper Development and John Kohler,
Architect, and Norma Swanson the property owner addressed the
Commission.
Mr. Christensen stated Walgreens has not requested public
assistance on the project. It appears that TIF discussion is not
relevant. Semper Development believes there are advantages to a
smaller project than proposed 6 years ago. There will be a lot
of green space, buffering and landscaping the neighborhood area.
We are able to comply with watershed requirements in a less
costly manner. We have spoken with many neighbors concerning the
project who are in favor of this project. We will create a very
long term, stable, national tenant making a long term commitment.
Mr. Commers asked who will own the building?
Mr. Christensen stated Semper Development will own and develop
the property with Walgreens as a long term lease.
Mr. Kohler reported the 14,000 sq. ft project has most of the
activity in the front, away from the residential area. The drive
through window is only for pick up of called in prescriptions. A
number of the neighbors have been contacted and requested the
fence extension and to keep the green space between commercial
and residential. The detention area will also become a good
buffer and be maintained, increasing the pine trees and replacing
the existing trees. Other comments from the neighbors were, they
want to see a project that will stay in the area for a very long
time rather than a tenant that comes and goes. The building will
be face brick on all sides costing about $72 a square foot to
construct. There is a tall glass front to the building with all
activity taking place in the front of the building.
Mr. Commers asked if there are any pictures of existing Walgreens
• �' •'4 f +M �� •' • •:
facilities as proposed.
Mr. Kohler stated this design has a new look compared to the
existing facilities. In Brooklyn Park, there is an example of a
new development.
Ms. Dacy stated staff has taken a video of the White Bear Lake
Walgreens building.
Mr. Kohler stated the proposed design is different from the White
Bear Lake Walgreens.
Ms. Schnabel asked, will the detention area be mowed?
Mr. Kohler stated yes. There is a drain in the detention area
which does meet the Rice Creek Watershed requirements.. The soil
is sand so it will not hold water. Since 1991 Watershed
requirements have been upgraded and so has this plan.
Ms. Schnabel stated it appears there is an enormous amount of
parking stalls.
Mr. Kohler stated the parking stalls meet the City requirements,
94 parking spaces is a lot and they would like to make changes to
that requirement.
Ms. Dacy stated there are two issues to consider. The drive
through location and the circular route around the building
hampers future development. The drive through makes the building
be placed in the middle of the lot. There is a site further
north where this development will fit fine. The second issue is.,
does the City see this plan as part of the vision for the
downtown area? Perhaps the HRA doesn't know what they want on
this site right now, but Walgreens is filing an application right
now.
Mr. Commers stated the HRA approved a plan at that time, for that
developer. We don't have any other plan that we have approved
since.
Ms. Swanson, the property owner stated she has tried to develop
this property for 20 years. In the meantime Anoka County has
condemned numerous plans. The City has made it very difficult to
sell this property. The Swanson family feels the property needs
to be sold as a family member has passed away. Ms. Swanson is a
HOUSING & REDEVELOPMENT AUTHORITY WIG. OCTOBER 9 1997 PAGE 10
resident of this neighborhood and feels that this plan is a nice
attractive plan for the neighborhood. If this plan does not go
through, the current building will remain empty as Ms. Swanson
has lost her tenant.
Mr. Commers asked Jim Casserly, Financial Consultant, for his
analysis of the project.
Mr. Casserly is not sure of
project since the applicant
is clear this project would
Other proposals in the past
due to the project density.
debt service on the lot.
the role of tax increment in the
is not asking for tax increment. It
generate $40 - $45,000 in taxes.
would probably generate $60- $70,000
This would help pay the existing
Mr. Meyer stated this Walgreens proposal is noticeably superior
to the prior plan as he was concerned about the traffic density
with the prior plan. Mr. Meyer is also impressed with the green
areas and respect of the neighborhood. Therefore it appears to
be the most ideal use of this property. If 13,000 square feet
needs 94 parking spaces, we would have needed 184 parking spaces
of 24,000 sq. ft, as well as the drainage area, making Mr. Meyer
wonder how would we fit that development on this site. Therefore
Meyer is in favor of proceeding with this development.
Ms. Schnabel concurs with Mr. Meyer as she does not see a single
user as a disadvantage. It certainly is a nice clean
development. The amount of asphalt is a concern, especially 90
some parking spaces. Hopefully one of the other boards can make
an accommodation concerning the asphalt. Perhaps some
imaginative landscaping with additional plantings could be done.
Ms. Schnabel respects staffs opinions but concurs with Mr. Meyer
and is in favor of proceeding with this development.
Mr. Commers asked Mr. Casserly with regards to the project being
in our TIF district, what do we have to do?
Mr. Casserly stated the district would have to be re- certified,
removing these parcels and create a new district.
Mr. Burns stated that some of this decision is in the hands of
other boards, however the vision of this sight is the HRA instead
of the Planning Commission. In the past 9 years, this site has
not been established as a top priority. The economy has more out
there to consider right now in speculation and urges the HRA to
HOUSING & REDEVELOPMENT AUTHORITY MTG. OCTOBER 9 1997 PAGE 11
consider these issues. Mr. Burns recommended looking at this
site as well as other areas in regards to development.
Ms. Dacy stated Walgreens has filed an application and the City
is required to react to that application. On the other hand, we
are in the position of reacting rather than proacting as in the
case of the Lake Point Development. The petitioners are
frustrated as they have put together a plan which is compared to
a previous plan. However staff is in the position of reacting
and perhaps there may be an option that you may like more.
Ms. Swanson stated it makes her feel very bad that site is not a
top priority after working many times to put together a plan to
present to the City.
Ms. Dacy stated from a resource standpoint, the City has had to
prioritize its work.
Mr. Commers stated staff is asking us to deny this request. Mr.
Commers felt that at this point, based on the fact that there is
not a real concrete long term vision, making it difficult to
tell Mrs. Swanson she cannot go forward with this development.
Perhaps we can lay this aside until the next meeting.
Ms. Dacy stated the petitioner would have to consent to a delay
in the 60 day, November 11th timeframe. There is time for
Council to have two meetings on this topic, but not for the HRA
unless a special meeting is called.
MOTION by Mr. Meyer, seconded by Ms. Schnabel to recommend the
approval of the Walgreens project to the City Council.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
5. RESOLUTION AUT:•R •N OF •- MENT CONTRA
GERALD ..
t _ i_
Ms. Dacy.stated the resolution is to authorize the execution of a
development contract providing up to $60,000 of tax increment
assistance via a pay as you go approach. Construction has
progressed per the code requirements. Should the HRA wish to
approve the project, a motion to approve the resolution
authorizing the execution of the development contract is
recommended.
HOUSING & REDEVELOPMENT AUTHORITY MTG OCTOBER 9 1997 PAGE 12
Mr. Commers asked Mr. Paschke why has it been so difficult to
find out what is going on with this project?
Mr. Paschke reported the contractor had trouble reaching the
inspector and needed to fill the street over the weekend. It
was dug it out for inspection and refilled again.
Ms. Dacy stated it appeared that the sewer and water construction
proceeded prior to inspection. However this issue has been
addressed and inspections have taken place.
Ms. Schnabel asked what happens if there is a default on the
note, how can you pay it in full?
Ms. Dacy stated the proposed contract requires completion of the
project prior to issuing a Limited Revenue Note in the amount of
$60,000. The note requires two payments per year to the
developer beginning on August 1, 1999 and ending on August 1,
2005. The amount of each payment is defined by the note to be
the lesser amount of 90% of the tax increment generated or the
prescribed amount in the note of $6,242. On the maturity date of
the note on August 1, 2005, if there is any unpaid portion
remaining, the note will be deemed to have been paid in full.
The HRA will pay on the note up to the tax increment. I f there
is a gap, it will be noted paid in full. At a given date we say
the note is deemed paid in full.
Mr. Casserly stated this language is in all notes as a
termination date is required. Valuation, tax rates and class -
rate risks are passed on to the note holder.
MOTION by Ms. Schnabel , seconded by Mr. Meyer to approve the
resolution authorizing the execution of the development contract
between HRA and Gerald Paschke
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
6. PUBLISHING AGREEMENT WITH TWIN CITIES BUSINESS MONTHLY
Ms. Dacy stated since the September mailing of the proposal by
Twin Cities Business Monthly Magazine, staff was hoping to come
up with 3 users to participate in the Twin Cities Business
Monthly. Staff recommendation was to proceed with the project
HOUSING & REDEVELOPMENT AUTHORITY MTG. OCTOBER 9 1997 PAGE 13
with the understanding that HRA's contribution would not exceed
$5,000. MEPC would provide $5,000 and a variety of businesses
would be contacted to provide additional advertising support. In
order to complete the project, a minimum of $15,000 is required
by Twin Cities Business Monthly. Because of the timing of the
proposal, we are hampered as the Chamber is publishing a piece as
well, creating competition. MEPC American Properties has
indicated a willingness to increase its sponsorship to $7,500 to
provide 50% of the minimum $15,000. It is therefore proposed
that the HRA provide the remaining match of $7,500. Medtronic,
Onan and Target will be contacted to provide sponsorship or
advertising supporting the piece. A brief outline for the
Fridley Special Section of Twin Cities Business Monthly was
distributed. The publication will feature Fridley as receiving
high marks for fiscal responsibility and progressive vision; a
location, labor force and a "can do" business attitude as well
as highlight existing corporations such as Medtronic, Target and
Onan. The Publishing Agreement with Twin Cities Business
Monthly was also distributed. Should advertising and sponsorship
revenue fall below projections and the project end prematurely a
$2,000 "kill fee" will be assessed to the City. Part of our
money will go towards re- prints to be utilized to attract.people
to the community. Medtronic did exhibit some interest in
becoming a sponsor.
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to authorize the
executive director to sign the publishing agreement for no more
than $7,500 for the 8 page feature of the Twin Cities Business
Monthly.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
INFORMATION ITEMS•
7 REMODELING PLANBOOK
Mr. Fernelius stated Ms. Metzdorff has been the principal in this
project. This is a priority identified for 1998. It is
important to raise the awareness of remodeling. One of the
program challenges is that we are looking for ways to improve the
1950 -style rambler which lacks the modern amenities that people
desire. We are proposing to create a remodeling book for four
types of ramblers present in Fridley. Perhaps remodeling the
kitchen, a master bedroom or adding more living space. The
HOUSING & REDEVELOPMENT AUTHORITY MTG OCTOBER 9. 1997 PAGE 14
publication will detail a brief description of plans, code and
zoning issues, information on loan program resources,
definitions, and whether this is a do- it- yourself project or a
contractor project. Staff has revised the figures on this
project from $12,000 to an in -house project at a range of $2,500
to $3,000. This could be available for the spring remodeling
fair.
Ms. Metzdorff has researched
and provided a demonstration
a typical Fridley rambler dei
change in the floor plan. A
demonstrated giving a home a
appearance.
a 3D software for clients to utilize
of its use. Ms. Metzdorff displayed
nonstrating the software to display a
front porch bump -out was also
new definition to the outside
Mr. Fernelius stated the concept of this program came from the
Longfellow Neighborhood Planbook that focused on the bungalow
style home. This would be a helpful, hands -on project benefiting
many of the residents in Fridley.
Mr. Meyer stated he continues to be disappointed in the scope of
the work done in the remodeling program. The plan book is useful
information but has little or nothing to do with addressing the
issue of substandard housing. Mr. Meyer commends the concept of
a plan book, a public service to the community. The $55,000
maximum income limit is something Mr. Meyer criticizes in the
current program. We must be more realistic in defining our
income requirements for this money.
Ms. Dacy stated on the other side of-that, realistically when
someone is going to the expense of remodeling a kitchen or
bathroom, new code requirements are addressed at that time.
Therefore some of your objectives are being accomplished.
Chairperson Commers inquired if there has been inquiries
received?
Mr. Fernelius stated he is receiving calls everyday and is
optimistic that something is going to happen on some of these.
sites soon.
Mr. Meyer asked why do we have this $500 non refundable
participation fee? The requirements and references seem
HOUSING & REDEVELOPMENT AUTHORITY MTG OCTOBER 9 1997 PAGE 15
sufficient since the HRA determines a plan is not acceptable, it
does not seem to be a good selling point for our program. If we
don't get any real offers, we may want to consider dropping the
$500 fee. Are we a little rich in our asking price of our lots?
Mr. Fernelius stated we are trying to ensure that folks coming
here are serious because staff spends a lot of time meeting with
the builder or developer. These fees are collected in Richfield
and the builder treats it as a cost of the program. Based on the
information Mr. Fernelius has seen, the prices seem to be on the
bottom end of the market. The price seems to be fair and there
isn't a lot of available land in Fridley.
u1; a 0 DY •►
On September 24th Margaret Metzdorff submitted her resignation
notice as Remodeling Advisor. Her last day of employment is
November 4th.
Chairperson Commers asked what will we do with Margaret leaving?
Mr. Fernelius stated the City is checking with surrounding areas
to see if it is possible to share this position. Ms. Metzdorff
stated that by offering a full -time position with benefits you
can obtain a well rounded applicant with the ability to support
other projects during the off season for remodeling. The
greatest negative aspect of a sharing situation was to be gone
from your position for five days while serving the other city.
Mr. Fernelius reported they were aware of this short - coming and
would work hard to address those issues.
• ic c$ it -.
Chairperson Commers asked about the Moore Lake Racquet Club
settlement.
Mr. Pribyl, Finance Director, stated the assessor has determined,
because of the competition in the market with the introduction of
Lifetime Fitness taking a major portion of their business, the
business has actually decreased.
Mr. Commers asked what impact will this have on the tax increment
district?
Mr. Pribyl will take a look at that and report back.
HOUSING & REDEVELOPMENT AUTHORITY MTG OCTOBER 9 1997 PAGE 16
Chairperson Commers mentioned the memo about the Lake Pointe
Project and Changes to Intersection by MnDOT. He also asked about
the Anoka County Request for Levy Involvement.
Mr. Pribyl stated this levy is for Anoka County, not the City.
The HRA has acted on the City's levy.
Mr. Burns stated Council has completed their action on the levy
as well.
Mr. Commers asked we have made 52 loans this year? What happens
with this Hyde Park area?
Mr. Fernelius replied yes, with only 4 to Hyde Park. It comes
down to reminding people that the programs are out there. Survey
results indicated some are concerned about the condition of their
neighborhood and don't want to invest.
Ms. Dacy reported, this year we have been tied up with many
projects. We do constantly advertise and continue marketing
efforts on the program.
Chairperson Commers stated this was the specific focus of the
program, the rehabilitation of the Hyde Park neighborhood. We
need to get a good handle on why we aren't addressing Hyde Park.
Mr. Fernelius stated the City has acquired a number of lots in
that neighborhood. Redevelopment and investment in the 3 new
houses should bring some spin -off.
Mr. Meyer added the size of the loans in Hyde Park are
significantly lower that those of the others. It must be the
money, their income. If we look at this, and are concerned about
Hyde Park, are there other ways to "sweeten the pie ", be more
liberal, perhaps drop the income limit to a certain point if our
objective is to improve the housing stock. Will this accomplish
our goal?
Mr. Pribyl presented additional expenses needing approval.
Vendor Description Amount -
Appraisal Engineering Appraisal 1545 75th Ave 275.00
Herbst & Sons Housing & garage removal 6,000.00
Margaret Metzdorff Mileage 57.66
Tautes, Redpath & Co. 1996 Audit 2,542.00
Total: 8,874.66
Mr. Burns reported the demolition expense was for the property
located at 5800 2nd Street.
MOTION by Ms. Schnabel, seconded by Mr. Meyer to approve the
additional expenses as presented by Mr. Pribyl.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
Mr. Burns reported he is in the process of formalizing a
business survey and is distributing to the commissions for their
input.
OTI N by Mr. Meyer, seconded by Ms. Schnabel, to adjourn the
meeting at 10:15 p.m.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED AND THE OCTOBER 9, 1997, HOUSING AND
REDEVELOPMENT AUTHORITY MEETING ADJOURNED AT 10:15 P.M.
Respectfully submitted,
Debbie Kidder
Recording Secretary
S I G N- I N S H E E T
HOUSING AND REDEVELOPMENT AUTHORITY MEETING, October 9, 1997
Name
Address /Business
0 w
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MEMORANDUM
HOUSING
AND
REDEVELOPMENT
AUTHORITY
DATE: November 7, 1997
TO: William W. Bums, Executive Director of HRA�
FROM: Barbara Dacy, Community Development Director
SUBJECT: Authorize Execution of Consent to Assignment and
Acknowledgment, Columbia Park Properties
BACKGROUND
Columbia Park Properties is building a new facility in Andover. As part of the financing
arrangements with its lender, Columbia Park Properties is entering into a Collateral
Assignment of Lease and Power of Attorney with the bank. This document assigns
Columbia Park's rights and responsibilities as a tenant in the parking lot lease with the
Authority (the parking area along 5th street) to the bank in the event Columbia Park
defaults under the terms of its loan agreement with the bank.
REQUEST
The Collateral Assignment requires that the Authority execute a "Consent to Assignment
and Acknowledgment". The Consent merely states that the Authority will recognize the
bank as the holder of the assignment if necessary. It does not change the Authority's
lease nor does it diminish the bank's responsibility to abide by the Authority's lease terms.
Casserly has reviewed both documents and has suggested a minor modification to the
notification requirements in both documents (see attached letter from Casserly to the
bank's legal counsel).
V *0161 Til F&I FA N61IT-lu C:
Staff recommends the HRA authorize the Chairperson and the Executive Director to
execute the Consent to Assignment and Acknowledgment after resolution of the
notification requirements as suggested by the Authority's legal counsel.
BD/
M- 97-474
11
11/04/97 TUE 14:50 FAX 612 885 5969 BRASS MONROE 002`�
a
KRASS MONROE, P.A.
A T T 0 R N 6 Y S A T L A W
■ James R. Casserly
Email jameso@JCraWwnroeosm
DireaJ)W (612) 88S -1296
November 4, 1997
VIA FACSIMILE (612) 672 -3777
Ron B. Peterson
MESSERLI & KRAMER, P.A.
1800 Fifth Street Towers
150 South Fifth Street
Minneapolis, MN 55402
Re: Collateral Assignment of Lease and Power of Attorney by Columbia Park Properties,
L.L.P. to First National Lender of Elk River
Our File No. 9571 -5
Dear Mr. Peterson:
On behalf of the Fridley Housing and Redevelopment Authority, I have reviewed the
above Collateral Assignment and the Amended and Restated Leasehold Agreement. Our only
concern is with Section 12. Lessor Notifications. That section requires an additional notice with
an additional time period. Since the Lease does not expire until December 20, 2081, adding
additional notice requirements seems to be an unreasonable request given that the HRA has to
track hundreds of trawa t►c 'ons (See also Paragraph 3 of the Consent to Assignment).
The balance of the Collateral Assignment and Consent to Assignment are acceptable.
Please advise.
Very truly yours,
KRASS MONROE, P A.
J es R. Casserly
rney at Law
JRC \jmm
Cc: City of Fridley
Attn: Barbara Dacy
r,. WPOATA\FIFRMUM4\COIkUSTMON.DOC
Suite 1100 Southpoint office Center
1650 West 82nd Street. Minneapolis. Minnesota 55431 -1447
Telephone 612.885.5999 Facsimile 612.885.5969 1A
0G.T. -22' 9 (1+EU) 11:lU )MSEKLI J, MAK IEK ILL.01' b �= r. Ui_
CONSENT TO ASSIGNIN ENT
AND ACR' NOWLEDGMENT
The Housing and Redevelopment Authority in and for the City of Fridley, Minnesota
( "HRA "), Lessor, hereby:
1. Consents to the foregoing Collateral Assignment of Lease ( "Assignment ") and consents to
the collateral assignment to the Lender of all rights and privileges contained in the
foregoing Assignment and agrees that in the event the Lender exercises its rights
pursuant to the Assignment, the undersigned will recognize the Lender as the holder
of the present assignment of Assignor's rights in the Lease in accordance with the
terms and conditions of the Collateral Assignment.
2. Acknowledges that the Lease is in full force and effect and that the Assignor is not in
default thereunder as of the date hereof.
3. Acknowledges its obligations contained in the Collateral Assignment to provide no
less than ten (1 U) days' written notice to the Lender and to provide the Lender an
opportunity to cure any defaults of the Assignor under the Lease.
Date: October ____, 1997
STATE OF MINNESOTA )
) ss.
COUNTY OF
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
FRIDLEY, MINNESOTA
By:
Printed Name:
Title:
The foregoing instrument was acknowledged before me this day of October, 1997,
by the of The
Housing and Redevelopment Authority in and for the City of Fridley, Minnesota, a Minnesota
body corporate and politic, on behalf of the City.
Notary Public
IK
UGI. '.G 7' OiLU1 11 UO t1 )OLALI y 10,. -VILA
ILL-U1- V - V -V-
COLLATERAL ASSIGNMENT OF LEASE
AND
POWER OF ATTORNEY
COLLATE ASSIGNMENT, by COLUMBIA PARK. PROPERTIES, L.L.P., a
Minnesota limited liab lity partnership ( "Assignor ") -to FIRST NATIONAL LENDER OF ELK
RIVER, a national banking association ( "Lender ") dated this day of October, 1997 ( "Collateral
Assignment ").
RECITALS:
A. Furs= it to a certain loan commitment dated October 16, 1997 ( "Commitment "),
Lender agreed to advance funds to Assignor for the purpose of constructing an office
medica I facility and all items necessary to complete and equip the facility on a
certain parcel of real property located in Andover, Minnesota (the "Land ").
B. Assign r is the fee owner of certain real property located at 6401 University Avenue
N.E., idley, Minnesota 55432 (the "Fridley Building ");
B. Pursua it to the terms of that certain Amended and Restated Leasehold
Agreer ient dated October 14, 1993 ("Lease"), by and between The Housing and
Redev lopment Authority in and for the City of Fridley, Minnesota ( "Lessor")
and As ignor's predecessor -in- interest, Columbia Park Properties, a Minnesota
genera partnership, Assignor leases from the Lessor a portion of real property
adj acei t to the Fridley Building, as legally described on the attached Exhibit A
(the'? emises "), for the purposes of providing parking to Assignor's employees,
invitee and customers.
C. Pursua it to the Commitment, Lender has agreed to advance funds upon the execution
and de very by Assignor of a Promissory Note in the amount of Three Million Five
Hun d Thousand and No /100 Dollars ($3,500,000.00) (the "Note ") executed and
deliver d pursuant to a Loan Agreement between the Lender and the Assignor
relatin to the advance and disbursement of funds for the construction of the
perma4ent improvements to the Premises ( "Loan Agreement ").
1C
i1Ci. - ?? 9" Ii1EDl 11 06 �IESSERLI IiRAtiIER TEL : 61? 6 "2 S "a? F,006
D. Pursuant to the Loan Agreement, the Assignor has executed and delivered to the
Lender as collateral security for the Note and the sums advanced pursuant to the
Loan Agreement, a Combination Mortgage and Security Agreement, Assignment of
Leases and Rents, UCC Financing Statements, and other documents as described in
the Loan Agreement; the foregoing documents, along with the Note and the Loan
Agreement, are herein referred to as the "Loan Documents ".
E. Pursuant to the Commitment and the Loan Agreement, the Lender has required that
the Assignor, as Tenant under the Lease, assign as collateral security for the
performance of the Note and the Loan Documents its interest as Tenant under the
Lease.
NOW, THEREFORE, in consideration of the foregoing Recitals which are incorporated;
herein, One Dollar ($1.00) and other good and valuable consideration and the advance of funds;
pursuant to the Loan Agreement and the Note, Assignor agrees as set forth below:
AGREEMENTS:
Section 1. Assignment. Assignor does hereby sell, assign and transfer to all of its right, title; estate
and interest as Tenant in the Lease, a copy of which is attached hereto as Exhibit "B ", and all options
to renew as contained in the Lease, to secure to Lender the repayment of: (i) Initial and future loans
made pursuant to the Loan Agreement; (ii) All other liabilities, advances or other sums due or to
become due under the Loan Agreement or the Loan Documents; and (iii) Any funds expended 6y
Lender to protect the validity of the Lease and the performance of the covenants, agreements and
obligations of the Assignor under the Lease; provided, that this Collateral Assignment shall not take
effect unless and until there shal l have occurred an event of default as defined in the Loan
Documents.
Section 2. Collateral Effect. This assignment by Assignor is intended to be a Collateral Assignment
and not a present assignment. Lender, at its option and in its sole discretion, may exercise its rights
under this Collateral Assignment in the event of a default in the payment or performance of the Note,
the Loan Agreement or the Loan Documents, or a default under the Lease.
Section 3. Representations_And_Warranties, As an inducement to the Lender to accept this
Collateral Assignment as security for payment of the Note and the Loan Documents, Assignor,
covenants, represents and warrants with and to the Lender as follows:
A. Assignor will not sell, convey, assign, pledge, mortgage, grant a security interese in,
or otherwise encumber all or any part of its interest in the Lease without the prior
written consent of the Lender. '
B. Assignor has made no other assignment, transfer, conveyance, pledge, mortgage or
grant of a security interest in the Tease.
C. The execution and delivery of this Collateral Assignment has been duly authoni d
by all necessary limited liability partnership governance action applicable to the'
2
1D
-?? 9�i11E0i 11:0" lIESSERLI R KRAMER TEL :61? 6 S "S? F.00-
Assignor and no approval of or filing with any governmental body, agency or official
is required or will affect the validity of the execution and delivery of this Collateral
Assigmnent.
D. Assignor has good right, title, and interest in and to the Lease and to possession
thereunder, and the full legal authority to assign the interest of Assignor under the
Lease; no other person or entity has any right, title or interest in and to the Premises.
E. Assignor has duly and punctually performed all the terms, covenants and conditions
of the Lease on Assignor's part to be kept, observed and performed,
F. The Lease is the valid and legal binding obligation. of the Assignor and has not been
modified and is in full force and effect as shown on Exhibit "B" attached hereto.
G. Assignor covenants and agrees to observe, perform and discharge, duly and
punctually, all the obligations, covenants, agreements, terms and conditions of the
Lease on the part of Assignor to be kept, observed and performed and to give prompt
written notice to Lender of any failure on the part of Assignor to observe, perform
and discharge any of the obligations, covenants, agreements, terms, and conditions.
H. Assignor covenants and agrees that it shall not agree to any modification, amendment
or alteration of the Lease without the advance written consent of the Lender.
Section 4. Power of Attomey, Assignor, until payment in full of the Note, and until any sums due
under the Loan Agreement and the Loan Documents have been fully paid, does hereby irrevocably
make, constitute and appoint the Lender, its true and lawful attorney in fact and in Assignor's name,
place and stead to do any of the following acts:
A. To exercise, assert and prosecute from time to time, by legal action or otherwise, any
and all claims, demands and causes of action arising, directly or indirectly, out of or
from the Lease or any amendment thereto, which Assignor may have against the
Lessor, its successors or assigns, or any other person or entity, and to settle,
compromise and adjust any such claims, including the right to receive any and all
monies that may be now or hereafter due and payable to Assignor arising out of any
such claim.
B. To advance and pay, at the option of Lender, without any duty or obligation on the
part of the Lender so to do, any and all sums which the Lender at any time deems
necessary or advisable for the purpose of preserving the Lease or the Premises, or of
paying, performing or enforcing the Lease, and any sums so advanced or paid by the
Lender shall be added to the amount due under the Note and shall be payable or
reimbursable by Assignor to the Lender upon its demand, together with interest
thereon, from the date of the advance at the rate specified in the Note.
C. To do and perform any and all other acts necessary or incident to the performance
and execution of the powers herein expressly granted, with power to do and perform
3
1E
OC-T. - 2' 9- (WED) 11, 0$ MESSERLI & KR AMER TEL.612 67? 5 "3? P.008
all acts, hereby authorized as fully to all intent and purposes as Assignor might or
could do with the full power of substitution.
D. It is understood that the above powers given by Assignor to the Lender, including its
successors and assigns, may be exercised solely at the Lender's option but without
any duty or obligation of Lender so to do.
E. All former powers of attorney made by Assignor in respect to the Lease and the
Premises are hereby revoked.
Section 5. Lease Payment Obligations, Assignor shall remain primarily liable for all rent, taxes,
insurance and all other sums due or to become due and payable under the Lease, and for all
obligations arising with respect to the Lease or the possession of the Premises by Assignor, prior to
the exercise by the Lender of any remedies to perfect its right in the Lease and the Premises.
Section 6. Events of Default/Remedies. Assignor agrees that upon default in any payments due or
to become due under the Note, the Loan Agreement or the Loan Documents, the Lender may enforce
this Assignment without first resorting to or exhausting any other security or collateral given to
secure the Note or sums advanced pursuant to-the Loan Agreement; provided, however, nothing
contained herein shall prevent the Lender from exercising any other right or remedy under any other
document or instrument evidencing or securing the Note, the Loan Agreement or the Loan
Documents.
Section 7. Waiv r Cumulative Remedies. No failure by the Lender to exercise any of the rights,
remedies, terms, covenants and conditions of this Collateral Assignment for any period of time or at
any time shall be construed or deemed to be a waiver of any such right, remedy, term, covenant and
condition, and nothing contained herein and nothing done or admitted to be done by the Lender
pursuant to this Collateral Assignment shall be deemed a waiver by the Lender of any of its rights
and remedies under the Note, the Loan Agreement or the Loan Documents, or to derive the full
benefit of any rights or remedies granted to the Lender pursuant to the Note, the Loan Agreement
and the Loan Documents. The rights of the Lender to collect the sums due pursuant to the Note and
the Loan Agreement, to enforce any other security granted therefor or to enforce any other right or
remedy under this Collateral Assignment, may be exercised by the Lender upon default, either prior
to, simultaneously with, or subsequent to, any such other action hereinabove described, and shall not
be deemed an election of remedies.
Section 8. Reassignment. In the event the Lender exercises its rights under this Collateral
Assignment, the Lender shall have the power and right to reassign its interest under the Lease to any
third party without the consent of any person or party, including the Lessor. Such Assignment shall
not be subject to the consent of the Lessor.
Section-9. Merger. Neither the fact that the Lease may be held, directly or indirectly, by or for the
account of any person or entlty which shall have an interest in the fee simple title to the Premises,
nor operation of law, nor any other event, shall merge the Lease with the fee simple title to Premises
as long as any of the indebtedness secured by the Note, the Loan Agreement and the Loan
Documents shall remain unpaid, unless the Lender shall consent in writing to such merger.
4
IF
-?1. 9- (1tiED) 11:08 )IESSERLI &. KR MER TEL:612 6-?
Section 10. Defeasanee. Upon payment in full of the Note and any sums due under the Loan
Agreement and/or the Loan Documents secured by this Collateral Assignment, this Collateral
Assignment shall become void and of no further force or effect, and upon the request of the
Assignor, and at the expense of the Assignor, the Lender will supply the Assignor with appropriate
satisfactions, releases, terminations and discharges of this Collateral Assignment. Notwithstanding
the foregoing, any affidavit, certificate, letter or statement of any authorized officer of the Lender
stating that any portion of the funds due pursuant to the Note, the Loan Agreement, or the Loan
Documents remains unpaid, shall be and constitute conclusive evidence of the validity an or
effectiveness in continuing enforceability of this Collateral Assignment. Any person,
corporation may and is hereby authorized by Assignor to rely on such affidavit, certificate, letter or
statement.
Section 11 Exercise of R.i�hts. The Lender may exercise its right under this Collateral Assignment
to become the Lessee under the Lease to obtain possession of the Premises and to take possession
and control thereof byi providing written notice of the exercise of such right to the Lessor and to the
Assignor. Such notice shall be in writing and shall be effective five (5) days after it is deposited in
the United States Mail in accordance with the provisions of Section 11 of this Collateral Assignment,
or five (5) days after personal delivery to the parties.
Section 12. Lessor N�c tifications. Lessor agrees that it shall provide written ould cause a termination
the existence of any default by the Assignor pursuant to the Lease which
or cancellation of the Lease at least ten (10) days prior to declaring any such cancellation or
termination against the Assignor under the Lease.
Section 13. Notices. Any notice, demand or other communication given or to be given pursuant to
the terms of this Collateral Assignment shall be in writing and shall be delivered by personal service
or sent by certified or registered mail, return receipt request, postage pre-paid and addressed as
follows:
ASSIGNOR: Columbia park Properties, L.L.P.
Attn: Spencer Johnson, Executive Managing Partner
! ! 6401 University Avenue N.E.
Fridley, Minnesota 55432
I'
LEER: ; , First National Lender of Elk River
Attn: Robert Smith
1121 West Highway 10
Anoka, MN 55303
or at such other address!within the United States or to the attention of such other personas any party
shalt have designated iri writing to the other party in accordance with th e provisions of this Section.
Any, notice, demand or other communication United States Mail in accordance Sect on.
effective five (5) days! after its deposit into the
i
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1 I
1G
OAT. -??' 9 -(WED) 11 :09 YiESSERLI & [iR AR TEL :612 6 "2 5 "52 P.0410
Section 14. Miscellaneous.
A. Successors and Assigns. The terms, covenants, agreements, conditions and
warranties contained herein and the powers granted hereby shall run with the land
and shall inure to the benefit of, and bind the parties hereto and their respective
successors and assigns.
B. Governine Law. Assignor expressly agrees that this Assignment is performable in
the State of Minnesota, and shall be governed by and construed in accordance with
the laws of the State of Minnesota.
C. Invalidi . If any provision of this Collateral Assignment or the application thereof
to any entity, person or circumstance shall be invalid or unenforceable to any extent,
the remainder of this Collateral Assignment and the application of such provision to
the other entities, persons or circumstances shall not be affected thereby, and shall be
enforced to the greatest extent permitted by law.
D. Entire Agreement/Modiiication. This Collateral Assignment contains the entire
agreement between the parties hereto pertaining to the subject matter hereof. No
variations, modifications or changes of this Collateral Assignment shall be binding
upon any party hereto unless set forth in a document duly executed by and on behalf
of such party.
E. Counterparts. This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original and all of which together shall constitute one
and the same instrument.
IN WITNESS WHEREOF, the undersigned Assignor has caused this Collateral Assignment
of Lease to be executed as of the day of October, 1997.
COLUMBIA PARK PROPERTIES, L.L.P.,
a Minnesota limited liability partnership
By:
6
1H
Spencer Johnson
Executive Managing partner
-22'911(WED) 1109 MESSERLI & KRAMER
STATE OF MINNESOTA )
TEL;612 672 3732
COUNTY OF )
The foregoing instrument was acknowledged before me this day of October, 1997,
by Spencer Johnson, the Executive Managing Partner of Columbia Park Properties, L.L.P., a
Minnesota limited liability partnership, on behalf of the partnership.
THIS INSTRUMENT DRAFTED BY:
MESSERLI & KRA.MER P.A. (RBP)
1800 fifth Street Towers
150 South Fifth Street
Minneapolis, Minnesota 55402
(612) 672 -3600
7
11
Notary Public
P. 011 `
JCT° -22' 9'(WLED) 1i:10 MESSERLI k KRAMER TEL:612 6 -2 •i j2 r, C!J
Leaal Description of Premiseg
I 9
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OCT, -??' 9' (WEDi 11:10 MESSERLI R KRAMER TEL :61? 6 -2 5 -32 P. 014
MAT: 3069321
1*14161001 :
Amended; and Restated Leasehold Agreement
between The Housing and Redevelopment Authority
in and for the City of Fridley, Minnesota, Lessor,
and
Columbia Park Properties, L.L.P.,
a Minnesota limited liability partnership,
j successor -in- interest to
Columbia Park Properties,
a Minnesota general partnership, Assignor
i
10
1K
EXHIBIT B
MEMORANDUM
HOUSING
AND
REDEVELOPMENT
AUTHORITY
DATE: November 7, 1997
TO: William Bums, Executive Director of HRA 0
FROM: Barbara Dacy, Community Development Director
Grant Femelius, Housing Coordinator
SUBJECT: Consider Acquisition of 1545 - 76h Avenue NE
This is a single family home located in the northeast comer of the City on 75' Avenue
between Arthur St. and Lakeside Dr. The house, which was built in 1956, is a one story
bungalow structure consisting of two bedrooms, a bathroom, a kitchen and an
unfinished basement. The house has 720 finished square feet of livable area. There is
also a small one -car, detached garage on site.
The house was identified as a priority property during the windshield condition study
done this past Spring. The house is relatively small in size and has suffered from
deferred maintenance, including siding and interior remodeling. The house is also
located a considerable distance from the street and doesn't match the building lines of
surrounding properties.
The house was appraised at $59,900 and is assessed for tax purposes at $61,900
($27,200 for the land and $34,700 for the building). The owner has agreed to sell for
$60,000 which is within the HRH's purchase price guidelines. The median value of
surrounding properties is $102,770. If acquired, the house and garage would be tom
down and the lot sold for redevelopment.
The purpose of this acquisition is to acquire and remove a substandard home which
over time will likely decline in both value and condition. As you recall from our previous
discussions, the role of the HRA's program is to intervene before blighting conditions
spread throughout a neighborhood. Adjoining property owners may be less willing to
invest in their own homes if housing conditions continue to decline. Because the
house is not considered hazardous, there is very little the City can do from a code
2
Acquisition Memo
November 7, 1997
Page 2
perspective to improve the property. Further, due to the condition, floor plan, and
location on the lot, there are few economic reasons to invest rehab dollars into the
home.
We should also mention that at the June 12, 1997 HRA meeting staff reviewed a new
acquisition policy in which the HRA can acquire properties using the following criteria:
1. The property is substandard in condition.
2. The home is occupied.
3. The owner is willing to sell.
4. The purchase price falls within the HRA's negotiation guidelines:
Attached is a site map showing the location of the property and several pictures of the
home. This would be a voluntary sale and the owner would not receive any relocation
benefits.
•ilu 9 AKORII
Staff recommends that the HRA approve the purchase of 1545 -75' Avenue NE from
Kurt D. Jones for $60,000. Further the Executive Director is authorized to sign all
documents necessary to complete the purchase.
GF/
M- 97-470
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1545 75th Avenue NE
Fridley, Minnesota
EXTERIOR SUBJECT PHOTOGRAPHS
3. Rear of Subject - Northwest Corner
4. Subject's Front Yard Viewed Southeasterly
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4. Subject's Front Yard Viewed Southeasterly
APPRAISAL ENGINEERING BURSA U INC-
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MEMORANDUM
HOUSING
REDEVELOPMENT
AUTHORITY
DATE: November 7, 1997
William Bums Executive Director of HRA
TO. (r�
FROM: Barbara Dacy, Community Development Director
Grant Femelius, Housing Coordinator
SUBJECT: Resolution Certifying Parcels for Phase II of the Housing
Replacement Program
On October 23, 1995 the HRA created a Housing Replacement District Plan for
Housing Replacement District No. 1. The Housing Replacement Program is a financial
tool for the HRA to use in recouping some of the costs of acquiring and redeveloping
substandard residential property. The HRA can collect tax increment from the new
home for a period of fifteen years.
The program allows the HRA to designate up to ten sites per year over a ten year
period. No more than fifty sites can be included in the program. This arrangement
gives the HRA the greatest flexibility to assemble a sufficient number of sites for
certification at onetime. For example, in 1996 the-HRA had depleted its inventory of
sites and therefore did not certify any sites into the program.
Eight sites were designated in Phase I in 1995. This year we are proposing to include
five more sites which will make a total of thirteen parcels. Once the sites are
designated by the HRA on November 13, 1997, the City Council must also approve a
separate resolution at their meeting on November 24, 1997. The list is then sent to the
County for final certification.
The Phase II parcels include the following:
530 Hugo St. NE
1545 - 75v' Avenue NE
5925 Main Street NE
3
Housing Replacement Program Memo
November 7, 1997
Page 2
5857 Main Street NE
5800 2 "a Street NE
The sites are currently offered for sale and will likely be developed in 1998. As a
result, the property value for tax purposes would be determined as of January 1, 1999
for taxes payable in 2000, the first year increment would be generated.
Jim Casserly has prepared a resolution for the HRA to approve, a copy of which is
attached.
IVX•1i �- •
Staff recommends that the HRA approve the resolution certifying parcels for Phase II of
the Housing Replacement Program.
GF/
M- 97-471
3A
r s
i
11/06/97 THU 14:05 FAX 612 885 5969 BRASS MONROE 0 002
KRASS MONROE, P.A.
ATTORNEYS AT LAW
■ James R. Casserly
Email jamesc@krassmonrce -com
Direct Dial (612) 885 -1296
MEMORANDUM
To: City of Fridley
Attn: Grant Femelius, Housing Coordinator
From: James R. Casserly
Date: 11/06/97
Re: Phase H of Housing Replacement Program
Our File No. 9571 -13
Enclosed please find the following.
1. A proposed Phase II for your Housing Replacement Program including maps,
estimated project cost and estimated impact.
2. A Resolution authorizing adoption of Phase II by the Authority.
Given the new class rates, we are estimating that the potential tax increment resulting from the
inclusion of the properties in Phase II will amount to approximately $5,615.50 per year. Over 15
years, which is the length of time the Authority may collect the tax increment, the Authority
should receive in excess of $84,000 for its Housing Replacement Program activities.
If there are any additional questions or problems, please give us a call.
JRCrmm
Encl.
G.WMATAWR 0LM13%COR*MJRC.00C
SURE 1100 SOUTHPOINT OFFICE CENTER • 1650 WEST 82ND STREET • BLOOMINGTON, MINNESOTA 55431 -1447
TELEPHONE 61205 -5999 • FACSNALE 612105.5969
3B
11/06/97 THU 14:06 FAX 612 885 5969 BRASS MONROE 9 003
ARTICLE III
PHASE II
Section 3.1. Syecific Development Activity. As of November 24, 1997, the Authority
intends to enter into the following proposed development activities for this Phase: acquire and
redevelop the properties at 530 Hugo St NE, 5925 Main St. NE, 5857 Main St. NE, 5800 tad St.
NE, and 1545 75`h Ave. NE.
Section 3.2. Estimated Proiect Costs. The estimated Project costs for this Phase are
listed on Exhibit I -A.
Section 3.3. Estimated Market Value. The estimated market value for each housing unit.
in Phase II can not exceed 150% of the average market value of single family housing in the
City. As of January 2, 1997, the average market value is $94,282 and 150% of that number is
$141,000. Upon completion of Phase II, the market value of the housing units included in Phase
II are estimated to be between $95,000 and $110,000.
Section 3.4. Original Tax Capacity. The original tax capacity for this Phase, as most
recently certified by the Commissioner of Revenue on January 2, 1997, is estimated to be $1,214.
Section 3.5. Estimated Captured Tax Capacity. Upon completion of the proposed
development activities, the estimated captured tax capacity of this Phase, on January 2, 1999, is
estimated to be $4,941.
Section 3.6. Original Tax Capacity Rate. The blended pay 1997 tax capacity rate is
113.651% (City 15.242; County 30.091; the average of Other 6.676 and Other 7.950; and, the
average of ISD #1155.588, ISD #14 66.159, and ISD #16 61268). See Exhibit I -B for
itemization.
Section 3.7. Estimated Tax Increment. Tax increment for this Phase has been calculated
at approximately $5,615.50 assuming a static tax capacity rate and a valuation increase of zero
percent (0 %) compounded annually.
Section 3.8. Duration Limits. Tax increment from this Phase is payable to the Authority
for fifteen (15) years from the date of receipt of the first tax increment. Assuming the first tax
increment is received in 2000, this Phase will terminate in 2014.
Section 3.9. Identification of Parcels. The parcels to be included in this Phase include:
3 -1
3C
11/06/97 THU 14:06 FAX 612 885 5969 RRASS MONROE Q004
03- 30 -24 -23 -0085
23 -30- 24-22 -0080
23- 30 -24 -23 -0102
23- 30 -24 -23 -0095
12- 30 -24 -11 -0071
530 Hugo St. NE
5925 Main St. NE
5857 Main St. NE
58002 nd St. NE
1545 75'h Ave. NE
and are illustrated on the attached Exhibit III — A.
3 -2
3D
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11/06/97 THU 14:07 FAX 612 885 5969
BRASS MONROE R006
.W MOW
ESTIMATED PROJECT COSTS
TOTAL PROJECT COSTS AS OF OCTOBER 23, 1995
Site Acquisition
$2,000,000
Relocation
$ 250,000
Demolition
$ 2002,000
Site Preparation
$ 250,000
Pollution Abatement
$ 125,000
Public Improvements
$ 125,000
Administrative Expense
$ 125,000
Total District Project Costs
$3,075,000
PHASE I PROJECT COSTS AS OF OCTOBER 23, 1995
Site Acquisition $ 50,300
Demolition $ 17,200
Site Preparation $ 2,000
Pollution Abatement $ 2,000
Administrative Expense $ 10,000
Total Phase I Project Costs $ 181,500
PHASE II PROJECT COSTS AS OF NOVEMBER 24, 1997
Site Acquisition $295,000
Demolition $ 56,000
Site Preparation $ 2,500
Administrative Expenses $ 6,500
Total Phase II Project Costs $360,000
I -A -1
3F
11/06/97 THU 14:08 FAX 612 885 5969 BRASS MONROE 2 007
EXHIBIT I -B
ESTIMATED IMPACT OF HOUSING REPLACEMENT DISTRICT NO. 1
PHASE II ONLY
IMPACT ON TAX BASE
IMPACT ON TAX RATE
TAX
ORIGINAL
ESTIMATED
CAPTURED
DISTRICT
RATE
TAX
TAX
TAX
TAX
AS %
ENTITY
BASE
CAPACITY
CAPACITY
CAPACITY
OF TOTAL
City of Fridley
27,404,055
1,214
6,155
4,941
.0.018%
County of Anoka
181,392,020
1,214
6,155
4,941
0.003%
ISD #11
1,184,407
1,214
6,155
4,941
.0.417%
IMPACT ON TAX RATE
Assumes construction would have occurred without the creation of Phase If of Housing Replacement
District No. 1. If construction is a result of Phase 11, the impact is $0.
3G
TAX
% OF
TAX
TAX RATE
ENTITY
RATE
TOTAL
INCREMENT
INCREASE
City of Fridley
0.15242
14.17%
753
0.003%
County of Anoka
0.30091
27.97%
1,487
0.001%
ISD #11
0.55588
51.66%
2,747
0.233%
Other
0.06676
6.20%
330
1.07597
100.00%
5,316
Assumes construction would have occurred without the creation of Phase If of Housing Replacement
District No. 1. If construction is a result of Phase 11, the impact is $0.
3G
if
11/06/97 THU 14:08 FAX 612 885 5969 RRASS MONROE
EXHIBIT I -B
ESTIMATED IMPACT OF HOUSING REPLACEMENT DISTRICT NO. 1
PHASE II ONLY
IMPACT ON TAX BASE
2008
IMPACT ON TAX RATE
TAX
ORIGINAL
ESTIMATED
CAPTURED
DISTRICT
RATE
TAX
TAX
TAX
TAX
AS %
ENTITY
BASE
CAPACITY
CAPACITY
CAPACITY
OF TOTAL
City of Fridley
27,404,055
1,214
6,155
4,941
0.018%
County of Anoka
181,392,020
1,214
6,155
4,941
0.003%
ISD #14
12,054,839
1,214
6,155
4,941
0.041%
IMPACT ON TAX RATE
* Assumes construction would have occurred without the creation of Phase II of Housing Replacement
District No. 1. If construction is a result of Phase II, the impact is $0.
I -- -
3H
TAX
% OF
TAX
TAX RATE
ENTITY
RATE
TOTAL
INCREMENT
INCREASE
City of Fridley
0.15242
12.90%
753
0.003%
County of Anoka
0.30091
25.46%
1,487
0.001%
ISD #14
0.66159
55.99%
3,269
0.027%
Other
0.06676
5.65%
330
1.18168
100.00%
5,839
* Assumes construction would have occurred without the creation of Phase II of Housing Replacement
District No. 1. If construction is a result of Phase II, the impact is $0.
I -- -
3H
11/06/97 THU 14:08 FAX 612 885 5969 BRASS MONROE 9 009
EXHIBIT I -B
ESTIMATED IMPACT OF HOUSING REPLACEMENT DISTRICT NO. 1
PHASE II ONLY
IMPACT ON TAX BASE
IMPACT ON TAX RATE
TAX
ORIGINAL
ESTIMATED
CAPTURED
DISTRICT
RATE
TAX
TAX
TAX
TAX
AS %
ENTITY
BASE
CAPACITY
CAPACITY
CAPACITY
OF TOTAL
City of Fridley
27,404,055
1,214
6,155
4,941
0.018%
County of Anoka
181,392,020
1,214
6,155
4,941
0.003%
ISO #16
8,669,981
1,214
6,155
4,941
0.057%
IMPACT ON TAX RATE
* Assumes construction would have occurred without the creation of Phase II of Housing Replacement
District No. 1, if construction is a result of Phase II, the impact is $0.
31
TAX
% OF
TAX
TAX RATE
ENTITY
RATE
TOTAL
INCREMENT
INCREASE
City of Fridley
0.15242
13.31%
753
0.003%
County of Anoka
0.30091
26.27%
1,487
0.001%
ISD #16
0.61268
53.49%
3,027
0.035%
Other
0.07950
6.94%
393
1.14551
100.00%
5,660
* Assumes construction would have occurred without the creation of Phase II of Housing Replacement
District No. 1, if construction is a result of Phase II, the impact is $0.
31
11/06/97 THU 14:08 FAX 612 885 5969 KRASS HONROE Zola
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE
CITY OF FRIDLEY
COUNTY OF ANOKA
STATE OF MINNESOTA
RESOLUTION NO.
A RESOLUTION AMENDING THE HOUSING
REPLACEMENT DISTRICT PLAN FOR HOUSING
REPLACEMENT DISTRICT NO. I TO INCLUDE PHASE II
BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the Housing and
Redevelopment Authority In and For the City of Fridley (the "Authority ") as follows:
Section 1. Recitals.
1.01. It has been proposed that the Authority amend the Housing Replacement District Plan (the
"Plan') for Housing Replacement District No. 1 (the "District ") to include Phase II, pursuant to and
in accordance with Laws of Minnesota 1995, Chapter 264, Article 5, Sections 44 through 47,
inclusive, as amended and supplemented from time to time.
1.02. The Authority has performed all actions required by law to be performed prior to the approval
and adoption of an amended Plan.
1.03. The Authority hereby determines that it is necessary and in the best interests of the City and
the Authority at this time to amend the Plan for the District to include Phase H in order to further
achieve the Authority's and City's goal of acquiring blighted, undeveloped or underdeveloped parcels
for redevelopment or rehabilitation, and for resale as market rate housing.
Section 2. Findings.
2.01. The Authority hereby finds that the adoption and implementation of the amended Plan is
necessary to assure the development and redevelopment of market rate housing within the City.
2.02. The Authority hereby finds that the amended Plan conforms to the comprehensive plan of the
City for the development and redevelopment of the City as a whole.
2.03. The Authority hereby finds that the amended Plan affords maximum opportunity consistent
with the sound needs of the City as a whole for development and redevelopment within the District
by private enterprise.
3J
11/06/97 THU 14:09 FAX 612 885 5969 RRASS MONROE Roil
Page 2 - Resolution No.
2.04. The Authority hereby finds that the approval and adoption of the amended Plan is intended
and, in the judgment of this Authority, its effect will be to promote the public purposes and
objectives specified in the Plan.
Section 3. Approval and Adoption of The Amended Plan.
3.01. The amended Housing Replacement District Plan for Housing Replacement District No. 1 to
include Phase H is hereby approved and adopted by the Commissioners of the Authority.
Section 4. Filing of Plan.
4.01. Upon approval and adoption of the amended Plan, the Authority shall cause said amended
Plan to be filed with the Minnesota Department of Revenue.
PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY IN
AND FOR THE CITY OF FRIDLEY THIS DAY OF _V1997.
LAWRENCE R. COMMERS - CHAIR
ATTEST:
WILLIAM W. BURNS - EXECUTIVE DIRECTOR
G:\ WPOATA \F \FRIDLEY \13 \DOC \RRARESII.DOc
3K
TO: FRIDLEY H.R.A
FROM: CITY OF FRIDLEY
RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES
OCTOBER 1997
Account Vs for
HRA's Use
ADMINISTRATIVE BILLING:
ADMINISTRATIVE PERSONAL SERVICES
ADMINISTRATIVE OVERHEAD
COMPUTER OVERHEAD
(For Micro & Mini computers)
TOTAL ADMINISTRATIVE BILLING: 460- 0000 - 430 -4107
OPERATING EXPENSES:
USPS - POSTAGE 262- 0000 - 430 -4332
US WEST - PHONE 460 - 0000 - 430 -4332
USPS - POSTAGE 460- 0000 - 430 -4332
TOTAL OPERATING EXPENSES:
BENEFITS EXPENSES:
Account Vs for
CR
City's Use
Code
20,394.75 101 - 0000 - 341 -1200
H1
284.13 101- 0000 - 336 -3000
HA
206.26 101- 0000 - 336 -3000
HA
`"ESCI
41.51 236 - 0000 - 336 -3000
45.67 236- 0000 - 336 -3000
61.93 236 - 0000 - 336 -3000
149.11
CITY OF FRIDLEY - HEALTH INS 262 -0000 -219 -1001 742.36 236 - 0000 - 219 -1001
CITY OF FRIDLEY - DENTAL INS 262- 0000 - 219 -1100 45.06 236 -0000- 219 -1100
CITY OF FRIDLEY - LIFE INS 262- 0000 - 219 -1200 7.00 236- 0000 - 219 -1200
TOTAL BENEFITS EXPENSES: 794.42
TOTAL EXPENDITURES - OCTOBER 1997
File: \EXDATA\HRA \TIF\97BILL.xis Details
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MEMORANDUM
HOUSING
REDEVELOPMENT
AUTHORITY
DATE: November 7, 1997
TO: William W. Bums, Executive Director
FROM: Barbara Dacy, Community Development Director
SUBJECT: Resolution Authorizing Execution of Second Amendment to
Contract for Exclusive Negotiations, MEPC American
Properties
The HRA approved the First Amendment to the Contract for Exclusive Negotiations on
August 14, 1997 to extend the terms of the agreement to November 1, 1997. A Second
Amendment is necessary to provide staff and MEPC with additional time to complete the
negotiations for the development agreement for construction of the one story 100,000
square foot office /showroom building at the west end of the site.
MEPC presented a preliminary site plan to staff on November 5, 1997 (attached). MEPC
will be required to plat the property and complete the required land use approvals. A
tentative date for construction was set for April 1, 1998.
The Second Amendment extends the terms of the original contract to January 31, 1998.
A development agreement will be prepared and scheduled for HRA consideration at its
January 1998 meeting.
1 -001IF �Ia
Staff recommends the HRA approve the attached resolution authorizing execution of the
Second Amendment to the Contract for Exclusive Negotiations.
.0
M- 97-475
E
k1/06/97 THU 10:37 FAX 612 885 5969 KRASS MONROE
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF FRIDLEY
COUNTY OF ANOKA, STATE OF MINNESOTA
RESOLUTION NO.
A RESOLUTION AUTHORIZING EXECUTION AND
DELIVERY OF A SECOND AMENDMENT TO THE
CONTRACT FOR EXCLUSIVE NEGOTIATIONS BY AND
BETWEEN THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF FRIDLEY AND
MEPC AMERICAN PROPERTIES, 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
"Authority ") as follows:
Section 1. Recitals.
1.01 It has been proposed that the Authority enter into a Second Amendment
to the Contract for Exclusive Negotiations (the "Amendment") with MEPC American
Properties, Inc. (the "Redeveloper ").
Section 2. Fes.
2.01 The Authority hereby finds that it has approved and adopted a development plan
known as the Modified Redevelopment Plan for its Redevelopment Project No. 1 (the
"Redevelopment Plan ") pursuant to Minnesota Statutes, Section 469.001 et sec
2.02 The Authority hereby finds that it has approved and executed a Contract for
Exclusive Negotiations between the Authority and the Redeveloper effective as of December 1,
1995 and a First Amendment to the Contract effective as of August 13, 1997.
Section 3. Authorizations.
3.01 The Chairman and the Executive Director (the "Officers ") of the Authority
are hereby authorized to execute and deliver the Second Amendment when the following
condition is met: .
Substantial conformance of a Second Amendment to the Second Amendment
presented to the Authority as of this date with such additions and modifications
as the Officers may deem desirable or necessary as evidenced by the execution
thereof;
Adopted by the Council of the City this day of , 199—.
ATTEST:
Executive Director
G:\ WPDATA \F \FRIDLEY \14 \DDC \2AMENRES.DCC
Chairman
�E-
0007
11/06/97 THU 10:36 FAX 612 885 5969 BRASS MONROE R002
EXECUTION: November 13, 1997
SECOND AMENDMENT
TO THE
CONTRACT
FOR
EXCLUSIVE NEGOTIATIONS
By and Between
THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF FRIDLEY, MINNESOTA
And
MEPC AMERICAN PROPERTIES, INC.
This document was drafted by:
Krass Monroe, P.A.
Suite 1100 Southpoint Office Center
1650 West 82nd Street
Minneapolis, Minnesota 55431
James R. Casserly
5C
11/06/97 THU 10:36 FAX 612 885 5969 BRASS MONROE Q003
SECOND AMENDMENT
TO THE
CONTRACT FOR EXCLUSIVE NEGOTIATIONS
THIS AGREEMENT is made on or as of this 13th day of November, 1997 by and
between the Housing and Redevelopment Authority in and for the City of Fridley, having its
principal offices at 6431 University Avenue N.E., Fridley, Minnesota, 55432, and MEPC
American Properties, Inc., a Delaware corporation with its Minnesota office at 1550 Utica
Avenue South, Suite 120, Minneapolis, Minnesota 55416.
WITNESSETH:
WHEREAS, the Authority and the Redeveloper entered into a Contract for Exclusive
Negotiations effective as of December 1, 1995 and a First Amendment to the Contract effective
as of August 13, 1997 (collectively the "Contract" - Capitalized Terms not defined in this
Agreement are defined in the Contract); and
WHEREAS, the Authority and Redeveloper desire to amend the Contract to further the
purposes set forth therein;
NOW, THEREFORE, in consideration of the premises and the mutual obligations of
the parties hereto, the parties hereby agree as follows:
Section 1. First Amendment Voided. The First Amendment to the Contract is hereby
declared null and void.
Section 2. Termination Extended.
A. Section S.1B of the Contract is hereby deleted.
B. Section 5.1C of the Contract is amended by deleting "August 1, 1997' in the
second line and substituting in its place the following: "January 31, 1998 ".
Section 3. Agreement Supersedes Contract. The terms and conditions contained in this
Agreement shall supersede any conflicting provisions contained in the Contract.
IN WITNESS WHEREOF, the Authority has caused this Second Amendment to the
Contract for Exclusive Negotiations to be duly executed in its name and behalf and the
Redeveloper has executed this Second Amendment to Contract for Exclusive Negotiations on
or as of the date first above written.
5D
11/06/97 THU 10:37 FAX 612 885 5969 KRASS MONROE Q 00A
Dated:
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF FRIDLEY, MINNESOTA
By
Its
By
Its
STATE OF MINNESOTA )
)ss
COUNTY OF RAMSEY )
On this day of , 199_ before me, a notary public within and
for Anoka County, personally appeared and to me
personally known who by me duly sworn, did say that they are the Chairman and Executive
Director of the Housing and Redevelopment Authority in and for the City of Fridley,
Minnesota, a political subdivision of the State of Minnesota, and acknowledged the
foregoing instrument on behalf of said Authority.
Notary Public
G:\ WPDATA \F \FRIDLEY \14 \DOC \2AMENCON.DOC
Authority Signature Page
Second Amendment to Contract for Exclusive Negotiations
2
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11/06/97 THU 10:37 FAX 612 885 5969 BRASS MONROE 9 005
Dated:
MEPC AMERICAN PROPERTIES, INC.
By:
Its:
By:
Its:
STATE OF )
)ss
COUNTY OF )
On this day of , 199 before me, a notary public within and
for County, personally appeared _ and
the and of
MEPC Properties, Inc., a Delaware corporation, and acknowledged the foregoing instrument
on behalf of said corporation.
Notary Public
G:\ WPDATA \F \FRIDLEY \14 \DOC \2AMENCON.DOC
Redeveloper Signature Page
Second Amendment to Contract for Exclusive Negotiations
3
5F
11/06/97 THU 10:37 FAX 612 885 5969 KRASS MONROE 9 006
SCHEDULE A
5G
EXECUTION: December 1, 1995
CONTRACT FOR EXCLUSIVE NEGOTIATIONS
THIS AGREEMENT, effective as of this 1st day of December,
1995 is between the Housing and Redevelopment Authority in and
for the City of Fridley, having its principal offices at 6431
University Avenue N.E., Fridley, Minnesota, 55432, and MEPC
American Properties, Inc., a Delaware corporation with its
Minnesota office at 1550 Utica Avenue South, Suite 120,
Minneapolis, Minnesota 55416.
WHEREAS, the Redeveloper is proposing to develop the area
identified on the map attached as Schedule A and is requesting
that the Authority negotiate exclusively with the Redeveloper
while the area is being studied, designed and marketed.
WHEREAS, the Authority is willing to negotiate exclusively
with the Redeveloper provided certain conditions described below
are met.
NOW, THEREFORE, in consideration of the premises and the
mutual obligations of the parties hereto, each of them does
hereby covenant and agree with the other as follows:
Section 1.1. Definitions. In this Agreement unless a
different meaning clearly appears from the content:
"Agreement" means this Agreement, as the same may be from
time to time modified, amended, or supplemented.
"Authority" means the Housing and Redevelopment Authority in
and for the City of Fridley, Minnesota.
"City" means the City of Fridley, Minnesota.
"Council" means the Council of the City.
"Marketing Plan" means the program to market the
Redevelopment Project. The Marketing Plan is further described
on Schedule B attached to this Agreement.
"Master Plan" means the plan detailing the overall
development of the Redevelopment Project as a corporate office
park with a commercial component on the Commercial Tract. The
Master Plan shall be prepared by the Redeveloper and approved by
the Authority and the City.
"Minimum Improvements" means as follows:
A. For the Office Tract it is the construction of Class A
office buildings of not less than 50,000 square feet
SH
and containing not less than three stories for each
building. The office buildings may contain some
ancillary space for service retail that is needed to
promote and develop a Class A corporate office park.
B. For the Commercial Tract it includes any use described
for the Office Tract and further includes commercial
uses such as restaurants, banks, day care centers,
hotels, medical clinic, convention center and service
retail but not general retail.
"Party" means a party to this Agreement.
"Purchase Price" means the amount to be paid by the
Redeveloper for the Redevelopment Property. The Purchase Price
for the Office Tract shall be an amount equal to fifty percent
(50%) of the market value established by an independent appraiser
selected by mutual agreement of the Authority and the
Redeveloper, provided that the appraiser shall have determined
the value within nine (9) months of the date of closing. Only
the first building in the Office Tract will be eligible, provided
that the building does not exceed 80,000 square feet, for the
Purchase Price described above. Since subsequent buildings in
the Office Tract will have structured parking, the Purchase Price
shall be ten dollars ($10.00) for each parcel.
The Purchase Price for parcels in the Commercial
an amount equal to seventy -five percent (750) of
established by an independent appraiser selected
agreement of the Authority and the Redeveloper,
appraiser shall have determined the value within
of the date of closing.
Tract shall be
the market value
by mutual
provided that the
nine (9) months
"Purchase Price Payments" means payments received by the
Authority for the Purchase Price.
"Redeveloper" means MEPC American Properties, Inc., a
corporation organized and existing under the laws of the State of
Delaware.
"Redevelopment Contract" means the Contract for Private
Redevelopment described in Section 4 of this Agreement.
"Redevelopment Project" means the Redevelopment Property and
the Minimum Improvements.
"Redevelopment Property" means the real property described
in Schedule A of this Agreement. That portion to the west
compromising approximately 24.56 acres shall be referred to as
the Office Tract. That portion to the East comprising
approximately 8.21 acres shall be referred to as the Commercial
Tract.
2
51
"State" means the State of Minnesota.
"Tax Increment" means only that portion of the real estate
taxes paid solely with respect to the Redevelopment Property
(which is part of the property in the Tax Increment District) and
which is remitted to the City as tax increment pursuant to the
Tax Increment Act.
"Tax Increment Act" means Minnesota Statutes, Sections
469.174 - 469.179.
"Tax Increment District" means Tax Increment Financing
District No. 6 created by the Council in connection with the
Redevelopment Program.
"Tax Increment Plan" means the tax increment financing plan
adopted by the Authority in connection with the creation of the
Tax Increment District.
"Unavoidable Delays" means delays which are the direct
result of strikes, other labor troubles, unusually severe or
prolonged bad weather, Acts of God, fire or other casualty to the
Minimum Improvements, litigation commenced by third parties
which, by injunction or other similar judicial action, directly
results in delays, or acts of any federal, state or local
governmental unit which directly result in delays.
Section. 2.1. Representations by the Authority. The
Authority represents as follows:
(A) The Authority is a public body duly organized and
existing under the laws of the State. Under the provisions of
the Act, the Authority has the power to enter into this Agreement
and carry out its obligations hereunder.
(B) The Authority is the fee owner of the Redevelopment
Property
(C) The Authority shall use all Purchase Price Payments to
reimburse the Redeveloper for the costs of structured parking in
the Office Tract.
Section 2.2. Representations by the Redeveloper. The
Redeveloper represents as follows:
(A) The Redeveloper is a Delaware corporation, organized
and existing in good standing under the laws of Minnesota, is
authorized to transact business in the State, has duly authorized
the execution of this Agreement and the performance of its
obligations hereunder, and neither the execution and delivery of
this Agreement, the consummation of the transactions contemplated
hereby, nor the fulfillment of or compliance with the terms and
3
51
conditions of this Agreement will constitute a breach of any
obligations of the Redeveloper under the terms and conditions of
any indebtedness, agreement or instrument of whatever nature to
which Redeveloper is now a party or by which it is bound, which
breach will materially adversely affect the ability of
Redeveloper to perform its obligations under this Agreement.
(B) The Redeveloper's mission for this Redevelopment
Property is to develop multi- tenant, multi -story office buildings
with support services commensurate with successful office parks.
(C) The Redeveloper will pursue all prospective users
including those interested in build -to -suit or land purchases
which fulfill the economic and aesthetic vision described in B
above and conform to the Master Plan.
(D) While the Office Tract has priority for development,
the Authority will not unreasonably withhold its approval of
those projects in the Commercial Tract that are identified in the
Master Plan and are essential in attracting users to the Office
Tract.
(E) The first office building may have temporary surface
parking but will be designed to accommodate structured parking of
two or more levels. With the development of a second building,
the two buildings will be served by a combination of structured
and surface parking. Subsequent buildings will be constructed
with structured parking but may also have surface parking.
Section 3.1. Redeveloper Responsibilities. The Redeveloper
shall be responsible for all costs associated with the marketing
and development of the Redevelopment Project. The Redeveloper
shall implement the Marketing Plan generally as follows:
A. Establish office market data on this location and
determine the corporate users and amenities for space
in the Redevelopment Project.
B. Review any previous plans and design a Master Plan as
necessary to maximize the site and meet the
requirements of the corporate users (in building size,
floor plate, quality, timing and market rate) for this
location. The Master Plan will be presented to the
City and Authority for their review and approval, and
the Redeveloper shall reasonably adjust the Master Plan
consistent with market needs as requested by the City
and Authority.
C. Develop marketing materials such as fliers and
brochures to assist in marketing efforts for mailings,
advertising, proposals to corporate users, broker
parties, press releases, etc. Scheduled timing of
4
5K
these marketing events and materials are set forth in
Exhibit B.
D. The official announcement to the public of the
Redevelopment Property would be achieved by the
activities shown on Exhibit B including:
Broker special event on site
News releases
Corporate user presentations
Mailings to prospects
E. Investigate the adequacy of soils, utilities, and
street systems for the Master Plan.
F. Review and comment upon the adequacy of the existing
indirect source permit and environmental assessment
worksheet for the Master Plan implementation.
G. Review and comment upon the adequacy of existing
ordinances to facilitate development of the Master
Plan.
H. Investigate the status of title, and review existing
environmental reports furnished by the Authority
regarding any hazardous substances on the Redevelopment
Property.
I. Every 90 days provide a written activities report to
the Authority which describes the Redeveloper's
activities pursuant to this Agreement.
J. Cooperate with the City and Authority in reasonable and
appropriate ways.
Section 3.2. Authority Responsibilities. The Authority
shall be responsible for the following:
A. Indirect source permit and associated traffic analyses
(amended and /or reactivated original) for the
Redevelopment Property.
B. Prepare any necessary environmental assessment
worksheet, environmental impact statement or
modification thereof.
C. Conduct any additional required environmental
investigation.
D. Provide any necessary infrastructure changes, including
street and intersection improvements, due to the Master
Plan.
5
5L
E. Refer all third party inquiries regarding use,
availability, and development potential of the
Redevelopment Property to the Redeveloper.
F. Recommend changes to City ordinances to facilitate
development consistent with the Master Plan.
G. Cooperate with the Redeveloper in reasonable and
appropriate ways.
H. Conduct a comprehensive review of Redeveloper's
performance under this Agreement on at least September
1, 1996 and March 1, 1997.
Section 4.1. Contract for Private Redevelopment. Provided
that this Agreement is not in default and any time after
Authority approval of the Redeveloper's Master Plan, at either
Party's request, the Parties shall negotiate in good faith and
execute the Redevelopment Contract within forty -five (45) days
after the request. The Redevelopment'Contract shall address the
issues involving the development of the Redevelopment Property
including the following:
A. The Purchase Price
B. Timing of the Minimum Improvements
C. Composition of the Minimum Improvements
D. Timing of any site improvements or public improvements
E. Redeveloper guarantees
F. Duration
G. Application of Purchase Price Payments to structured
parking
Section 5.1. Termination. This Agreement shall terminate
as follows:
A. If by August 1, 1996 the Redeveloper has not completed
the program elements as outlined in the Marketing Plan
or this Agreement.
B. If the Redeveloper, has not commenced construction of
an office building in the Office Tract by August 1,
1997, said time to be extended by Unavoidable Delays.
The August 1, 1997 date shall be extended to November
1, 1997 if the Redeveloper has provided a letter of
intent, lease or commitment to lease for an office
building.
5M
C. If the Parties have not executed a Redevelopment
Contract by August 1, 1997.
Section 5.2. Effect. The Parties agree that upon
termination of this Agreement they shall have no further
obligation to each other except as provided for in this Agreement
and the Parties further agree to execute any document reasonably
necessary to give effect to a termination.
Section 6.1. Additional Provisions:
A. The Redeveloper shall not assign this Agreement.
B. The Redeveloper shall hold the Authority and the City,
their agents, officers and employees harmless from any
of the Redeveloper's acts or the acts of those
operating under its direction with regard to marketing,
development, construction, sale and all other
activities contemplated by this Agreement.
C. The Parties are not partners in the development of the
Minimum Improvements or in any activities contemplated
by the Agreement.
D. If requested by the Authority, the Redeveloper shall
provide evidence of a general liability insurance
policy in an amount of one million ($1,000,000) per
person and two million ($2,000,000) per occurrence
naming the City and the Authority as insured parties
and which requires a 30 -day written notice of
cancellation to the City and the Authority.
IN WITNESS WHEREOF, the Authority has caused this Agreement
to be duly executed in its name and behalf and the Redeveloper
has caused this Agreement to be duly executed on or as of the
date first above written.
7
5N
Dated: CJI-t � 6 14 S E
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
OF FRIDLEY, MINNESOTA
By a�L
Its Chairman
And by -
Its Executive Director
STATE OF MINNESOTA )
ss
COUNTY OF ANOKA )
On this 1p� day of �— 199 ,1 before me, a
not pry public i r Anok C,�inty, pegs,�jna y ap eared
IZa �%Lo me
personally known who by me duly sworn, did say that they are the
Chairman and Executive Director of the Housing and Redevelopment
Authority in and for the City of Fridley, Minnesota, a political
subdivision of the State of Minnesota, and acknowledged the
foregoing instrument on behalf of said Authority.
i
ROBERTA S. COLLINS
NOTARY PUBLIC - MINNNESOTA Xot ary Public
ANOICA CCUNTY
My Comm. Exp. Jza. LS. =3
Authority Signature Page — Contract for Exclusive Negotiations
:3
50
D
Dated: December 15, 1995
TEXAS
STATE OF i�4I•iGTA )
)ss
COUNTY OF nAT_T eC )
MEPC American
s, Inc.
By t ` —
Do . Fuller
Its Senior
Vice �President
By
Richard A. Weiblen
Its Vice President Property Mgmt.
On this 15th day of nar- =168Z , 199-5- before me, a
notary public within and for _ County, personally appeared
nnnn x_ Fu11 Pr , the Senior Vice �s es=� of MEPC
Properties, Inc., a no,nwnre corporation, and acknowledged
the foregoing instrument on behalf of said corporation.
n atrtAtW- %06,gj
Notary Public
State of Texas
Commission Expiros 1= 6=9r
Redeveloper Signature Page – Redevelopment Contract
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SCHEDULE B
FRIDLEY MARKETING PROGRAM
Press Release:
Signage:
Flyer Created and
Mailed Users & Brokers:
Focus Group for
Office Users:
Master Plan Review:
Press Release:
Direct Mail Piece to
Brokers:
Broker Event on Site:
Quarterly Updates:
Upon execution of the Agreement
Revise signage showing
Redeveloper as contact
January 1996
January 1996
February 1996
Planning review would commence
after information is provided by
the first focus group.
Redeveloper will then present
the preliminary Master Plan to
the City and Authority for
Authority response and review by
April 15, 1996, the Authority
shall review and or approve or
modify the preliminary Master
Plan by May 15, 1996.
Upon review and approval of
preliminary Master Plan
June 1996
July 1996
Redeveloper will provide updates
to the Brokerage community on a
quarterly basis. This
development project will be in
the annual Redeveloper vacancy
update
Redeveloper would meet with the
Authority quarterly to provide
project updates
Continuing marketing efforts would be evaluated and put in place
as needed after August 1, 1996.
5R
t".
MEMORANDUM
HOUSING
WW1
REDEVELOPMENT
AUTHORITY
DATE: November 7, 1997
TO: William Bums, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Femelius, Housing Coordinator
SUBJECT: Consider Policy for Subordination Agreements for Housing
Loan Program
In October 1997, staff was contacted by a resident who had received a Fridley home
improvement loan and was requesting a loan subordination agreement in order to
refinance their first mortgage. In this case, the borrower's new mortgage lender would
be in a subordinate position after paying off the old mortgage and the HRA would move
into first position.
In general, mortgage lenders will not approve financing unless they are in first position.
As a practical matter, either the HRA loan has to be paid off or the HRA must agree to
subordinate its debt to the new mortgage company. Most or our borrower's do not
have the financial resources to pay off the HRA's loan pre - maturely. More importantly,
the HRH's low interest rate makes it attractive for most homeowners to continue making
their payments rather than pay-off early or refinance. By not subordinating, the
borrower has few options until the HRA loan is paid in full, which in some cases can
take up to twenty years.
Because agreeing to a loan subordination can affect the HRA's ability to re -coup funds
in the event of a default and foreclosure, there are financial and policy implications for
the HRA. To date this issue has not been discussed with the HRA. As part of our
research process, staff has talked with HRA Commissioner McFarland and officials at
Anoka County and the Minnesota Housing Finance Agency. Adopting a policy now will
establish sound criteria for evaluating future requests.
L•e
Loan Subordination Memo
November 7, 1997
Page 2
Loan Subordination Policy
The underlying assumption of the subordination policy is that the HRA should not be in
a worse security position. In other words, the total of all encumbrances against the
property should not exceed the market value of the property after the subordination.
Also, any net proceeds from the refinancing must either be used for closing costs or
other expenses incidental to the transaction. The borrower should not be taking equity
out of the house for other purposes such as consolidation loans, car loans, etc.
Below are the proposed criteria for evaluating a subordination request.
1. The borrower is current on their loan payments to the HRA.
2. The borrower has not filed for bankruptcy subsequent to receipt of the
HRA's loan.
3. No other liens or encumbrances (i.e. mechanic's liens, 3'd mortgages, etc.)
have been filed against the property.
4. Subordination only to a TO mortgage.
5. The borrower will only use the loan proceeds to pay for closing costs or
other expenses incidental to the transaction. The HRA will not sub - ordinate if the
borrower receives "cash out" of the transaction.
6. The combined loan -to -value ratio of the new first mortgage and the
HRA's debt shall not exceed 100% of the value of the property.
7. The borrower must either furnish a copy of the new lender's appraisal or
pay for a separate appraisal conducted by a licensed real estate
appraiser.
Jim Casserly has prepared a resolution for the HRA to approve, a copy of which is
attached. We should also mention that the borrower who made the initial request,
Jerry Butler, will likely attend the HRA meeting on November 13"'.
• ILORNI
•
Staff recommends that the HRA approve the resolution establishing a policy for the
subordination of loans in the HRA's loan programs.
GF/
M- 97-472
t.
11/05/97 WED 15:48 FAX 612 885 5969 BRASS MONROE 9 002
HRA RESOLUTION NO.
A RESOLUTION ESTABLISHING A POLICY FOR THE
SUBORDINATION OF HOUSING LOANS OF THE HOUSING
AND REDEVELOPMENT AUTHORITY IN AND FOR THE
CITY OF FRIDLEY; PROVIDING FOR THE DELEGATION OF
CERTAIN POWERS AND DUTIES.
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 Authority has previously established, by HRA Resolution Nos. 3 -1993, 4 -1993, 16-
1995 and 8 -1996 housing rehabilitation programs which, among other things, provided
for the making of loans funded by the Authority (collectively the "Loan Program") in the
City of Fridley.
1.02. It has been proposed that the Authority now adopt a policy regarding the subordination of
its loans in the Loan Program.
Section 2. Findings.
2.01. The Authority hereby finds that the Loan Program promotes the purposes of the
Authority as those purposes are defined in Minnesota Statutes, Section 469.001, a sea.
(the "Act').
2.02. The Authority hereby finds that the Loan Program assists in the preservation,
maintenance and provision of adequate housing stock; that accomplishing this is a public
purpose in that there are many residences in the City which require rehabilitation.
2.03. The Authority hereby finds that participants in the Loan Program may have a need to
refinance debt which is secured by a mortgage superior to the Authority's mortgage.
Section 3. Adoption of Policy.
3.01. The Authority hereby approves and adopts the Subordination Policy as described on
Schedule A attached to this Resolution (the "Subordination Policy ").
• .
11/05/97 WED 15:48 FAX 612 885 5969 BRASS MONROE IM002
Section 4. Delegation of Powers and Duties.
4.01. The Executive Director or the Chairman of the Authority are hereby authorized to
approve the subordination of any Authority debt in accordance with the Subordination
Policy and to execute any documents necessary to implement the Subordination Policy.
PASSED AND ADOPTED BY THE FRIDLEY HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF FRIDLEY THIS DAY OF NOVEMBER,
1997.
LAWRENCE R. COMMERS — CHAIRPERSON
ATTEST:
WILLIAM W. BURNS — EXECUTIVE DIRECTOR
QAWMATA1F%=LM21D0C0RARML.D0C
-2-
11/05/97 WED 15:48 FAX 612 885 5969 BRASS NONROE 9 004
SCHEDULE A
SUBORDINATION POLICY
Intmduction
The following policy covers all loans issued by the Authority through its
Program, including; housing rehabilitation
1. Single Family Revolving Loan Program
2. Single Family Last Resort Loan Program
3. Multiple Family Last Resort Loan Program
4. Hyde Park Matching Deferred Loan Program (Single Family)
5. Hyde Park Matching Deferred Loan Program (Multiple Family)
6. Hyde Park Last Resort Loan Program (Single Family)
7. Hyde Park Last Resort Program (Multiple Family)
8. Home Mortgage Assistance Program
9. Home Improvement "Gap" Loans
Loan Subordination Re uirements
The Authority will subordinate its secured debt under the following conditions:
1. The borrower is current on their loan payments to the Authority;
2. The borrower has not filed for bankruptcy subsequent to receipt of the Authority's loan;
3. No other liens or encumbrances have been filed against the property;
4. Subordination only to a 0 mortgage;
5. The borrower is only using the loan proceeds to pay for closing costs or other expenses
incidental to the transaction. The Authority will not
" cash out" of the transaction. subordinate if the borrower receives
6. The combined loan -to -value ratio of the new first mortgage and the Authority's debt shall not
exceed 100% of the market value of the property.
7. To determine market value the borrower must either furnish a copy of a new lender appraisal
or pay for separate appraisal conducted by a licensed real estate appraiser.
-3-
• 9
MEMORANDUM
HOUSING
I 1
REDEVELOPMENT
AUTHORITY
DATE: November 7, 1997
TO: William Bums, Executive Director of HRA40-
FROM: Barbara Dacy, Community Development Director
Grant Femelius, Housing Coordinator
SUBJECT: Participation in Minnesota Solutions Redevelopment
Initiative
In July 1997, several fully developed suburban communities began meeting to discuss
redevelopment issues, particularly in response to proposed changes to tax increment
financing at the last session of the State Legislature. The group joined forces with
Minnesota Solutions, a non - profit organization, directed by Bonnie Balach. You may
recall, that her organization was involved in Fridley's efforts at the State Legislature two
years ago to establish the Housing Replacement Program.
The focus of Minnesota Solution's Redevelopment Initiative is to build a coalition of
support for redevelopment programs. The group has developed a two year work plan
(copy attached) which will begin by defining the pertinent issues, developing grass roots
support, arranging hearings and testimony, and finally producing a bill and legislative
agenda. Among the goals are to create an urban renewal tax increment district,
redevelopment fund and /or other incentives to meet redevelopment needs.
Minnesota Solutions is requesting contributions of $800.00 per year for the next two
years to help support their efforts. Staff has identified sufficient funds in the 1997 HRA
budget to cover participation for this year. An additional $800.00 will be programmed
into the 1998 HRA budget.
Unless otherwise directed, staff will remit the necessary funds to Minnesota Solutions to
participate in the Redevelopment Initiative. We will provide you with updates at future
HRA meetings.
GF/
M- 97-473
7
01. - /11/1994 19:51 6126534926 BONNIE BALACH PAGE 01
Minnesota
Solutions, Inc.
• STATEWIDE VOICE FOR LEGISLATiVE SOLUTIONS •
October 7, 1997
TO: Grant Fernelius
City of Fridley
FR: Dave Anderson. Acting Chair
City of St Louis Park
RE: Minnesota•Rgdev_elonment Initiative
I'm writing to fvrinall% request the participation of your city/organization in Minnesota S lutions —
the only statewid•.- nrV mixation to have a singular focus on redevelopment. Over the neNt two
legislative sesslo,1% YX W"II launch an ambitious redevelopment agenda, which we hope will begin
to set the stag, fora statewide policy on redevelopment. We have developed a draft of a mission
document that %q1jiasjvciftcs regarding Minnesota Solutions and this redevelopment nitiative.
Because Minnl gala Slltutinns has resources already dedicated to this enterprise, the nee for
additional funds it rl411irnal. We are asking each city/organization to contribute 5800.00 per year
for the next two m 'that will give us approximately $45,000 to $50,0000 to put our, ork plan
into action. we C-4:otached a copy of our work plan for your review and welcome an
comments you might have.
This endeavor is Ilmg over due. Last session was another difficult one for redevelopme efforts
statewide. Redawloptrtent is complex and costly and the traditional tools for urban ren al, tax
increment finamial for instance, cannot in itself leverage the high cost, complexity anc risk
involved in develor►ng previously used or difficult urban sites. There is considerable w rk to be
done in teams of - -ducal ing lawmakers and building a political base that will make this iTpportant
public issue a prio>!l-I the Capitol. We urge you to join in this important initiative.
We have enclosed a core of our next meeting notice. We hope you can attend and help
formalize our structure and approval process as well as engage in lively debate with Gin
Yingling, SierftChb -1, she discusses the interest that organization has in redevelopme
We look forward to hearing from you.
attachments
Smite I1011 7-1' 11rFIr.E CB;TSR . 16 -ir - - –1MD STRKgt • Bl.f)AVIbGTAr, 1dINNB9pT�
'TMLBVNnN¢ 612/88 7A FiGSIy1LF 612/88.5+.5969
It.
1.1417
61/11/1994 19:51 6126534926 BONNIE BALACH PAGE 05
Minnesota
Solutions, Inc.
■ STATEW10b VOICE FOR LEGISLATIVE SOLUTIONS •
MINNESOTA REDEVELOPMENT INITIATIVE
What Is the problem? Redevelopment is complex and costly. Local financial resources
inadequate and redevelopment will not occur in the absence of public sector investment. In
addition, there has been ro statewide group with a singular focus on redevelopment to sha this
type of agenda and propel it through a legislature and governors office for which the redev opme
needs of older cities have not been a high priority.
What is redevelopment? Broadly defined, it is the recycling or revitalization of "used" pr
primarily old commercia! or industrial sites. Redevelopment can involve the demolition of b ighted,
vacant, obsolete or structurally unsound buildings, updating of existing structures within a
redevelopment area. or a combination of both.
Why is public Investment warranted? There is no incentive for the private sector to tack+ dI ficult
infill projects or redevelop old industrial, residential or commercial property when undeve
parcels of land are available Public sector investment is required to induce private develo of
these difficult sites It is a good public investment. Reuse of existing public infrastructure, ' b
creation in older cities where social problems and unemployment are exacerbated by aalbe
industrial property declining property values, transportation, public coasts of providing new
infrastructure in outlying areas and environmental issues should drive state and federal inv
in this area. However this has not been the case. The only tools designed to encourage irban
renewal in the absence of contamination — UDAG, CDBG and TIF — have either disappeaed,
declined or been reformed until no longer useful, particularly for very difficult redevel
projects. Economic development incentives, on the other hand, have remained strong and
particularly last session received a legislative boost, contributing even more to the uneven playing
field that exists between the development of greenfields and redevelopinwit.
What Is the "Solution ?" The legislative delegations representing members of this coalftk n will
introduce a bill that will represent, by its many components. a statewide policy with respect to
redevelopment. Some proposed facets:
• Increase TIF fund at the Department of Revenue.
• Create a statewide redevelopment fund.
• Propose specific changes in current TIF law provisions to facilitate redevelopment,
• Provide tools to preserve historic property throughout the state.
• Create "urban renewal" TIF districts.
• Provide state incentives for collaborative efforts Involving redevelopment, job crest
affordable housing and transportation.
• Require trnrinmir impact statements for general economic law development props
What Is Minnesota Solutions? Cities and organizations statewide with dill loo infill or
industrial redevelopment needs have come together to collectively educate the legislature d
governors office about redevelopment issues and build a political base from which to la a major
legislative initiative Minnesota Solutions is focussed solely on making toots to facilitate
redevelopment a legislative priority.
S1 trK 111111 • •.1 1III,-; IsT (IF Fir E cCNtEt . 18-50 WRee u•1.... '�TtCET . B1,011141\GTO4. Mlnrt%nTA 5-5431.1447
TEtEPHonc 612/885.43 7B NILE 612/885.5969
01/11/1994 19:51
6126534926
BONNIE BALACH
"MINNESOTA REDEVELOPMENT AGENDA"
PROPOSED WORK PLAN
This proposed agenda represents a two -year effort. Although most of the work will t
prior to the commencement of the next legislative session, the next session is a bon
than a funding yttr and our focus for additional dollars will span the next two sessic
accordingly.
I. Develop statement of purpose to include:
A. Composition -- identify cities with redevelopment needs.
B. Legislative agenda for redevelopment needs statewide.
C. Need.
11. Grassroots strategy for legislative support:
A. Identify participants in fully developed community consortium.
B. Minnesota Solutions staff to work individually with members to Men
11k1 vers of the community interested in redevelopment.
PAGE 03
e done
ling, rather
�3to5
C. Build data base of community folks and city staff to be easily sorted b legislative
district and legislative committee.
D. Set up meetings with legislators representing fully developed cities St; tewide to
include city staff, community leaders identified in above process and I Ainnesota
Solutions staff to talk about the legislative agenda.
E. Arrange meetings between governor's office and leadership and legi ators
representing fully developed communities statewide. Pertinent committee chairs
Should receive attention as well.
III. Arrange hearings and testimony for "Minnesota Redevelopment Initiative .n
IV. Communicate status of project by E -mail or fax to members.
V. Documents to be produced:
A. A bill representing a legislative agenda for fully developed communitic s should
be introduced at the beginning of session. This bill should be a comp ehensive
bill with many articles representing a state policy with respect to redo elopment.
There should be sufficient jackets for legislators representing fully developed
communities statewide to all be included as bill authors. Possible elements:
I Urban renewal tax increment financing district.
2. Redevelopment fund.
7C
1
61/11/1994 19:51
Vi.
6126534926
BONNIE BALACH
Incentives for regional approaches to redevelopment needs.
A. State grants.
B. Relief from TIF restrictions.
C. Others?
B. Briefing papers to support legislative requests.
C. TIF primer.
D. Summary of studies and ideas for funding redevelopment already put
I . Citizens League Studies
2. Metropolitan Council study.
3 Brownfield consortium.
4. Others?
E. Session summary.
Monitor state task forces charged with responsibilities for TIF and other econ
development efforts:
7D
PAGE 84
es:
0i/11/1994 19:51 6126534926 BONNIE BALACH
Minnesota
Solutions, Inc.
q $TATEWIDE V(jICF, FOR LECISLATIVE SOLUTIONS •
INVOICE
October 8, 1997
TO: Grant Femelius
City of Fridley
FR: Dave Anderson, Acting Chair
City of St Louis Perk
RE: Minnesota Solutions Contribtftn
DUE AND PAYABLE UPON RECEIPT
For development and lobbying of the - Minnesota Redevekpreent Initiative"
for the 1998 legislative session, the City of Fridley Contribution ...............................
Please make cherks, payable to Minnesota Solutions and mail to:
Bonnie Balach
Minnesota Solutions
Suite 1100 Southpoint Office Center
1650 West 82nd Street
Rloomington, MN 55431 -1447
PAGE 82
.
CriTr. IIg4 nrrlCE CEYTCR • 163 12Yp STREET • P1.00MINGTOY. (Ninnralntl 354 31.1447
TRotpHumE 612/8F 7E, FAC31mms 612/885.6988
LOAN ORIGINATION REPORT
October 1997
Year- to-Date
City Wide Loans and Graruta
CDBG
HRA
MHFA
HOME
Date
Type of
Name
Address
Loans
Loans
Grants
TOW
Closed
Property
Program
1 Moses
5180 Hughes Ave.
$ 12,922 $
$
-
$ 12,922
117/97
SngleFamily
HRA 5%
2 King
375 67th Ave. NE
$ 11,306 $
$
-
$ 11,308
128197
Sbgle Fan*y
HRAS%
3 Larson
6130 8th St NE
$ 4,670 $
- $
-
$ 4,670
2!25197
ShVe -Family,
HRA 5%
4 Diedrich
46 88th Way NE
$ 8,375 $
- $
-
$ 8,375
3/11/97
Single- Family
HRA 5%
5 Elverud
221 Rice Creek Terr.
$ 4,839 $
$
-
$ 4,8319
3112/97
Shgle -Family
HRA 5%
6 Zebro
6589 Clam Pl.
$ 11,039 $
- $
-
$ 11,039
4!7/87
Si gle -Family
HRA 5%
7 Westirdield
92 Rice Creek Way
$ 25,000 $
- $
-
$ 25,000
418/97
Shgle -Family
HRA 5%
8 Setering
71 68th Way NE
$ .10,000 $
$
-
$ 10, 000
4/8197
Si gle -Famly
Last Resort Deterred
9 Doherty
7315 East River Rd
$ 3,474 $
- $
-
$ 3,474
416197
Shgle -Family
HRA 5%
10 Westby
1467 Onondaga St
$ 10,000 $
- $
-
$ 10,000
4/22187
Single-Family
HRA 5%
11 Medej
6400 Startits Blvd
$ 9,50 $
- $
-
$ 9,500
4rdW7
Sngle -Family
HRA 5%
12 Anderson
6800 Oakley SL
$ 7,500 $
- $
-
$ 7,500
429197
Single-Family
HRA 5%
13 Olson
1442 848( Ave. NE
$ 2,700 $
- $
-
$ 2.700
4/29197
Si gle-FamBy
HRA 5%
14 Mello
6218 Carol CI.
$ 2,000 $
- $
-
$ 2,000
518197
Single-Family
HRA 5%
15 Butler
5948 7th St NE
$ 16,814 $
- $
-
$ 16,814
516!97
Single -Family
HRA 5%
16 Allard
516 54th Ave. NE
$ 7,239 $
- $
-
$ 7,239
5/8197
Single -Family
HRA 5%
17 Warner
69310 Hickory Dr.
S 4,859 $
- $
-
$ 4.659
5/7/97
Shgie -Family
HRA 5%
18 Englebrefson
1643 Gardens Ave.
S 3,800 $
- $
-
$ 3,800
5113/97
Single -Family
HRAS%
19 Hart
861 Pandora Dr.
$ 13,200 $
- $
-
$ 13,200
5/13197
Single-Family
HRA 5%
20 Varroe
974 Rice Creek Terr.
$ 4,800 $
- $
-
$ 4,850
5/1987
"le -Fancy,
HRA 5%
21 Miller
525 Seared Dr.
$ 3,750 $
$
-
$ 3,750
527197
Single-Family
HRA 5%
22 Larson
359 BBth Ave. NE
$ 10,380 $
- $
-
$ 10,380
527197
Slogle-Famlly
HRA 5%
23 Larson
5980 4th St NE
$ 15,594 $
- $
$ 15494
6117/97
Shgle -Family
HRA 5%
24 Brack
5621 Hodzon Dr.
$ 11,000 $
- $
-
$ 11,000
6124197
Shgle -Fancy
HRA 5%
25 Hatched
1313 Hillwind Rd.
$ - $
5,000 $
$ 5,000
4111197
Single-Family
MHFA Energy Loan
26 Massey
5941 8th St NE
$ - $
51000 $
-
$ 5,000
5123/97
Single-Family
MHFA Energy Loan
27 Schiil
560lrordonSt
$ 6,140 $
$
-
$ 6,140
7/1197
Shlgle•Family
HRA 5%
28 Czech
7665 Barron Dr.
$ - $
2,700 $
-
$ 2,700
7/1/97
Shgle•Fan nily
MHFA Energy Loan
29 Blegen
275 Ironton St
$ 6,508 $
- $
-
$ SAN
7/1/97
Siille -Family,
HRA 5%
30 Kaye
585 Roe Creek Ter.
$ 8.400 $
- $
-
$ 8,460
718197
Single -Family
HRA 5%
31 King
1505 Ferndale Ave.
$ 24,046 $
- $
-
$ 24,046
7/8197
Sngle -Family,
HRA 5%
32 Wasse nan
340 Hugo St
$ 22,550 $
- $
-
$ 22,550
722197
Single-Family,
HRA 5%
33 Samuelson
593 Roe Creek Terr.
$ 8,600 $
- $
-
$ 81600
7129197
Single - Family
HRA 5%
34 Pierce
572 Rice Credo Terr.
$ 18,522 $
- $
-
$ 18,522
722/97
Shgle -Family
HRA 5%
35 Amax
6121 Sunrise Dr.
$ - $
- $
8,908
$ 8,908
Pen"
Shgte -Family
CDBG Grant
36 Holm
6120 Sunrise Dr.
$ - $
- $
7,238
$ 7,236
7/17197
Shgle -Fam9y
CDBG Grant
37 Loan
1334 761h Ave. NE
$ 13,107 $
- $
-
$ 13,107
722197
Single - Fam9y
HRA 5%
38 Ramsey
1340 64th Ave. NE
$ 25,000 $
14,600 $
-
$ 39,600
815197
Shgle -Family,
HRA 5%
39 Jacobson
6606 Brookvlovr Dr.
$ 18,286 $
- $
-
$ 18,288
8112197
Shgle -Family
HRA 5%
40 Wells
6553 Oakley Dr.
$ 1,937 $
- $
-
$ 1,937
8112197
Sngle -Family
HRAS%
41 Scherber
1376 66th Ave. NE
$ 2,837 $
- $
-
$ 2,037
8112/97
Single-Family
HRA 5%
42 Keay
5771 Central Ave. NE
$ 18,448 $
- $
-
$ 181448
8119/97
Single -Family
HRA 5%
43 Wassemmn
340 Hugo St
$ 11900 $
- $
-
$ 1,900
8119/97
Single-Family
IRA 5%
44 Bissonette
6001 Woody Ln.
$ 19,793 $
- $
-
$ 19,793
8/19197
Single-Farotly
HRA 5%
45 Barron
5331 5th St NE
$ 2,014 $
- $
-
$ 2,014
9/18197
Shgle -Farn ly
HRA 5%
46 Milich
71 63-12 Way NE
$ 2,097 $
- $
-
$ 2,097
919197
Shgle-Family
HRA 5%
47 Crosser
5812 5th St NE
$ 8,700 $
- $
-
$ 8,700
9!9197
Siille -Family
IRA 5%
48 Grade
7398 Melody Dr.
$ 2,100 $
- $
-
$ 2,100
919197
Single-Family
HRA 5%
49 WeitonSntlth
5632 8th St NE
$ 9,165 $
- $
-
$ 9,165
9/9197
ShgleFamily
HRA 5%
50 Holmberg
6150 Sunrise Dr.
$ 7,538 $
- $
-
$ 7,538
923197
Shgle-Family
HRA 5%
51 Cutler
7513 East Rim Rd.
$ 1,936 $
- $
-
$ 1,936
923197
Slrgle-Fam ly
HRA 5%
52 Johnson
6800 Monroe St.
$ 19,244 $
- $
-
$ 19,244
8123197
Sog(e -Family
KRA 5%
53 Erickson
231 Longfellow St
$ 62W $
- $
-
$ 8200
9123197
Single - Family
HRA 5%
54 Rattan
4769 Main St NE
$ 5,685 $
- $
-
$ 5,685
9/3087
Shgle -Family
HRA 5%
55 Koop
578 Ironton St
S 4,520 $
- $
-
$ 4,520
1018197
Si gWFartdly
HRA 5%
56 Nelson
6090 Woody Lm
$ 8,351 $
- $
$ 8,351
10/14/97
Shgle-Family
HRA 5%
57 Miller
6045 2 -12 St NE
$ - $
4,722 $
-
$ 4,722
10/14197
Shgle -Family
HRA 5%
58 Haldomon
514 Dover St
$ 25,000 $
- $
-
$ 25.000
10/14/97
Sigle -Family
HRA 5%
59 Price
7449 Melody Dr.
$ 11,588 $
- $
-
$ 11,568
10128197
Shgle•Family
HRA 5%
60 Marvin
7829 Alden Way
$ 25,000 $
- $
-
$ 25.000
102aw
Shigle-Fantlly
HRA 5%
00 Loans and Grano
Sub - Totals
$ 549,250 $
32,022 $
16,144
$ 597,416
Hyde Park Loans and Grants
1 Alderson
6061 -65 3rd St NE
$ 6,621 $
- $
-
$ 8,621
12887
Duplex
Hyde Park Matching Deferred
2 Monson -
0048 2 -12 St NE
$ 2,235 $
- $
-
$ 2,235
411/97
Shgle -Family
Hyde Park Maohing Deterred
3 Rocek
5791 2 -12 St NE
$ 1,837 $
- $
-
$ 1,837
4/8197
Single -Family
Hyde Park Matcdng Deferred
4 Anderson -
6001 -65 3rd St NE
$ 1,379 $
- $
-
$ 1,379
8K1,97
Duplex
Hyde Park MaW*V Deferred
5 Johnson
800'1 -53 3rd St NE
$ 4,492 $
- $
-
$ 4,492
9115197
Triplex
Hyde Park Matching Deterred
5 Loans and Grants
Sub-Totais
$ 16,564 $
$
$ 18Ji84
8S
Grand Totals
$ 585,814 $
32,022 $
16,144
$ 613,980
LSR - SEP 97
LOAN SERVICING REPORT
End of September 1997
Installment Loans
Number of Loans
150
Total Principal Issued
$
1,926,876.06
Principal Balance at Beginning of Month
$
1,774,467.16
Principal Payments
$
10,846.40
Principal Balance at End of Month
$
1,763,620.76
Interest Payments
$
- 7,475.54
Late Fees
$
44.89
CRF Servicing Fees
$
(816.00)
Net Interest Received
$
6,704.43
Net Payments Received
$
17,550.83
Deferred Loans
Number of Loans 23
Total Principal Issued $ 123,033.00
Principal Balance at Beginning of Month $ 123,033.00
Principal Payments $ 36.40
Principal Balance at End of Month $ 122,996.60
Interest Payments $ 1.80
Late Fees $ _
CRF Servicing Fees $ _
Net Interest Received $ 1.80
Net Payments Received $ 38.20
TOTAL PAYMENTS RECEIVED (THIS MONTH) $ 17,589.03
TOTAL PRINCIPAL ISSUED ** $ 2,049,909.06
TOTAL OUTSTANDING PRINCIPAL ** S'1,886,617.36
Notes:
* Covers most recent reporting period. CRF remits payments and loan servicing
reports approximately 15 days after end of previous month.
** Since program inception.
P*,^'
8A