HRA 10/01/1998 - 6303z
HOUSING & REDEVELOPMENT AUTHORITY MEETING
THURSDAY, OCTOBER 1, 1998
7:30 P.M.
PUBLIC COPY
(Please return to Community Development Department)
CITY OF FRIDLEY
HOUSING & REDEVELOPMENT AUTHORITY MEETING
SEPTEMBER 3, 1998
Vice - Chairperson Schnabel called the September 3, 1998, Housing and
Redevelopment Authority meeting to order at 7:30 p.m.
ROLL CALL:
Members Present: Virginia Schnabel, Pat Gabel, John Meyer, Jim McFarland
Members Absent: Lary Commers
Others Present: Barb Dacy, Community Development Director
William Bums, City Manager
Grant Femelius, Housing Coordinator
Jim Casserly, Financial Consultant
Rick Pribyl, Finance Director
Craig Ellestad, Accountant
Dennis Schneider, Councilmember
Nancy Jorgenson, Mayor
Guy & Kathy Jordan, 6540 E. River Road, #224
APPROVAL OF MINUTES:
June 26,1998:
MOTION: by Ms. Gable, seconded by Mr. Meyer, to approve the June 26, 1998,
Emergency Housing and Redevelopment Authority meeting minutes as written.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve the August 6,
1998 Housing and Redevelopment Authority minutes as written.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
CONSENT AGENDA:
Vice - Chairperson Schnabel noted that a list of additional expenses requiring
HRA approval was distributed for review. She asked if the HRA wished to
remove any of the Consent Agenda items for further discussion.
Mr. McFarland asked that Item 1 be removed. Vice - Chairperson Schnabel
asked that Item 5 be removed.
MOTION by Mr. McFarland, seconded by Ms. Gabel, to approve the Consent
Agenda with the exception of Item 1, Clarification Regarding Acquisition of 5859
3`d Street and Item 5, Claims & Expenses.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UANIMOUSLY.
1. DISCUSSION ON CLARIFICATION REGARDING ACQUISITION OF
5859 3RD STREET
Mr. Fernelius explained that this item was before the HRA at its July meeting. At
that time, staff had negotiated a purchase price of $43,000 with Mid America
Bank who had received the property through a foreclosure. Prior to that
meeting, staff discovered that there was approximately $9,780 in outstanding
water bills and delinquent taxes on the property. It was felt that the HRA should
reduce the purchase price by the amount of the delinquencies, and the HRA
authorized the acquisition in the amount of $34,000.
Mr. Fernelius stated that since that time, staff has been working with Norwest
Bank to coordinate the closing. However the loan officer has indicated that the
bank is essentially paying for the delinquencies twice by reducing the sale price
to $33,220 and then again by bringing a check to closing for the amount of the
delinquencies. Therefore, they are unwilling to sign the purchase agreement as
presented. It has been suggested that the funds be deducted by the title
company at the closing and paid to the City and County directly. Staff is
therefore recommending that the HRA reauthorize the purchase of 5859 3'
Street N.E. for the $43,000 subject to Noblest Bank paying the delinquent taxes
and water bill in the amount of $9,780.
Mr. McFarland stated he questions the accuracy of the appraisal, which came in
at $46,000, and feels perhaps the HRA is paying too much for the property. He
asked what the HRA could expect the lot to sell for.
Mr. Fernelius stated similar lots have been sold for between $20,000 and
$25,000. This particular lot is a little larger.
Mr. McFarland noted that the HRA can expect to spend approximately $5,000 to
have the home removed.
Mr. Femelius explained that these costs have not been deducted from the
purchase price in the past.
Ms. Dacy explained that this property has been vacant for approximately two
years. She is concerned that if the property remains as is, the bank may just
choose to walk away from the property at some point.
Mr. Bums asked if the property is "nonconforming ".
Ms. Dacy responded that she did not believe so.
Mr. McFarland stated this is a case where the bank made a loan for
improvements and the improvements were never made. Therefore, the loan
nearly doubled, and the value of the house remained the same. If the bank
maintains ownership, they will likely complete minimal improvements to make it
salable. Nonetheless, he does not feel the HRA should pay more for the
property than it is worth.
Ms. Dacy noted that if the HRA desired, she could request that the City's
appraiser review the appraisal of the property.
Mr. McFarland asked whether the HRA obtains their own appraisal on the
properties.
Mr. Fernelius stated that this is normally the case; however, due to timing issues,
the HRA did not obtain their own appraisal on this property.
Ms. Schnabel stated she would like to have the City obtain an appraisal on the
property and hold off on any decisions until that has been completed.
MOTION by Mr. McFarland, seconded by Ms. Gabel to re- authorize the
purchase of the property at 5859 Third Street N.E. for $43,000 subject to
Norwest Bank paying the delinquent taxes and water bill in the amount of
$9,780.
UPON A VOICE VOTE, TWO VOTING AYE, AND TWO VOTING NAY
( SCHNABEL AND MEYER), VICE - CHAIRPERSON SCHNABEL DECLARED
THE MOTION FAILED.
Staff will obtain an appraisal of the property per request and bring this issue
before the HRA for reconsideration.
5. DISCUSSION ON CLAIMS & EXPENSES:
Vice - Chairperson Schnabel asked for clarification on the $259,704.71 in
Administrative expenses for the month of August.
Mr. Ellestad stated that this is a reimbursement for general obligation bonds that
were paid by the City.
MOTION by Ms. Gabel, seconded by Mr. McFarland to approve the Claims and
Expenses as presented.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
- • • • - • • • ; • •�
Mr. Femelius explained that this item was previously scheduled for the August
HRA meeting. At that time, Mr. And Mrs. Jordan were in the process of obtaining
bids on their home plans and discovered that it was more costly than they could
afford. Since that time, they have drafted a new plan and are seeking approval.
The new plan is a split -entry design with 1,085 square feet finished and 420
square feet of unfinished space in the lower level. The plan also includes a two -
car attached garage.
Mr. Femelius stated that the proposal states that Mr. And Mrs. Jordan will need
to close and take title to the property by October 1, 1998, and start construction
by November 15, 1998. The home must be completed by June 15, 1999.
Mr. and Mrs. Jordan were present to answer questions. Mr. Jordan stated that
the costs once again came in slightly higher than they anticipated, but they feel
that they are manageable. He stated they are appreciative of the HRH's
completion of the soil boring tests, and that they have included in their plans both
an inside and outside drain tile system to address any drainage concerns.
MOTION by Mr. Meyer, seconded by Ms. Gabel to approve Resolution No. HRA
15 -1998. A Resolution Authorizing the Execution and Delivery of a Contract for
Private Redevelopment by and between the Housing and Redevelopment
Authority in and for the City of Fridley, Minnesota and Guy W. Jordan and
Catherine S. Jordan.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
INFORMATION ITEMS:
Mr. Femelius explained that the City had Braun Intertec drill a test hole on each
of the sites. The findings indicated that because of the way the site is currently
graded, a lot of water tends to collect in one particular area. The borings have
shown that there is a layer of clay approximately 5 -11 feet down below the
surface, and surface water is draining through the top sandy soil and percolating
down to the clay layer. It appears that the soil is suitable to build on but that a
drain tile system will need to be installed along with waterproofing the outside of
the block wall. In addition, with proper grading, it is not believed that there will
be any major problems.
Mr. Femelius distributed a copy of the Monthly Housing Program Summary for
the month ending July 1998 for the Board's review.
Ms. Dacy noted that there were two additional items which she would like to
bring before the HRA.
Mr. Pribyl, Finance Director, explained that this bond would actually be the final
permanent issue related to the money which was originally required to purchase
the Lake Pointe property. In 1992, the City issued $4,030,000, which was a two -
year temporary issue. A $4,090,000 issue replaced this one in 1995. Temporary
issues are no longer allowable, and this permanent issue will finance the Lake
Pointe site.
MOTION by Ms. Gabel, seconded by Mr. Meyer to adopt Resolution No. HRA
16 -1998, A Resolution Approving and Authorizing Execution of Tax Increment
Pledge Agreement Respecting $4,185,000 Taxable General Obligation Tax
Increment Bonds, Series 19988.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
DISCUSSION ON TERMS FOR REDEVELOPMENT CONTRACT WITH
MEDTRONIC:
Ms. Dacy explained that on August 20, 1998, Mr. Casserly and she met with
Medtronic's negotiating team and arrived at a conceptual agreement on the
terms of the redevelopment agreement. Both sides agreed to go back to their
respective Boards to obtain input. Ms. Dacy presented the terms to the City
Council at the August 24 meeting. Since that time, however, Medtronic has
made some changes, and a new list of terms has been verbally agreed upon by
them which she wished to present to the HRA. She stated she would like to
obtain approval of the concepts, subject to concurrence by the HRA
Chairperson.
Ms. Dacy went through the original goals, which were presented at the end of
June. These included:
1) maximizing the density on the site;
2) wanting to have it supported by structured parking and parking ramps;
3) wanting a significant tax base and revenue for the citizens of Fridley;
4) wanting to recover at least some of the Authority's costs;
5) wanting a well designed campus;
6) wanting it to be compatible with the surrounding area.
Ms. Dacy stated she believes that a new look at the entire site from what was
originally proposed by MEPC will be necessary in order to accomplish the goals
for Medtronic. They originally came in wanting the land for free and 100% of the
tax increment, which was based upon a previous proposal. The first phase of
the development will be given to them for $1.00; however, the future phases will
be paid for based on a schedule of "holding payment costs ". Also agreed upon
was a sharing of the tax increment. They will take 80% of the tax increment and
the HRA will take 20% up to a present value of $3.3 million (this assumes that
they build 1,000,000 square feet of office space). Thereafter, they will take
97.5% and the HRA will take 2.5 %.
Ms. Dacy stated the City and Medtronic have agreed on a performance schedule
of Medtronic accomplishing certain amounts of square footage before they have
the ability to obtain the remaining land. She presented an example of the
construction threshold requirements, the calculations of the land holding
payments, the tax increment, and the commercial restrictions. She stated that
240,000 square feet of office space must be constructed before the commercial
facilities can be built. The amount of land for commercial development cannot
exceed 356,866 square feet.
Mr. Casserly stated the commercial restrictions were put in place as a
compromise. At this time, Medtronic is exploring their options; however, the City
has indicated that the majority of the land was not intended to be used for
commercial purposes.
Ms. Dacy went through the terms for the redevelopment vel pmeent contract, which had
been negotiated between Medtronic and the ty
Ms. Schnabel asked if there are any minimum requirements for open space.
Ms. Dacy explained that the agreement would address maximum amount
determine the actual of
building coverage. There are many issues which will determ
amount of green space such as storm ponds, ramps, entry features, etc.
Building site coverage cannot exceed 40% of the site. terms of the
Mayor Jorgenson stated that Item edtronic page
us ng tax redevelopment contract refers increment moneys it
receives from the HRA on any statutorily authorized eligible expenditure
including "road and utility realignments ". She stated that roads are already put in
previously using tax increment financing, and she was concerned that this may
be a single use item within a tax increment district.
Mr. Casserly explained that in the light of the district, changes could be made in
the infrastructure.
Ms. Dacy explained that in 1987 the City had to make a decision to make ve his
site marketable and it was done knowing what would that was
the site in
Unfortunately, there was now y of know
the future.
Councilmember Schneider noted that the cost for this would be approximately
2% of the overall value of the development.
Mayor Jorgenson stated she is concerned that the legislature will look at this as
a one -time allowable expense within the tax increment at adlatri timed she does not
want to see the City become liable for the expense
Ms. Dacy noted that #14 basically states that Medtronic cannot leave any
unusable parcels. Item #24 states that the City /HRA will provide Medtronic with
all environmental studies, tests and analyses. bThis for any a'ddit onal
was completed two years ago. Medtronic w responsible
environmental testing it desires to complete on the site.
Ms. Dacy stated Item #34 does not relate to the redevelopment project; however,
Medtronic views this as very important to their existing campus on Rice Creek.
They would like a full access on Highway 65 to their Rice Creek campus. The
City /HRA has advised them that they will initiate a traffic analysis to see if
MNDOT will permit that.
MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve the terms and
concepts for the Redevelopment Contract with Medtronic as presented dated
September 3, subject to the final confirmation of the Chairperson.
Mayor Jorgenson asked if #35, which states that Medtronic will not be assessed
for any of the improvements necessitated by the Traffic Plan, has ever been
done before, especially in the case where it is necessary due to their
development.
Mr. Casserly stated he did not know if there is an example within the City where
this has occurred; however, it is not unusual when doing office parks and large
scale commercial development that the community will put in public
improvements to address all of the traffic concerns. With the economic state
over the past years, the City has lost almost twelve years of its ability to collect
increment on the site. If they had that ability, they would have been able to
address many of the issues. He stated that this is a land use that will affect the
community for the next 50 to 100 years and it will offer an unusual amount of
opportunities for the City of Fridley.
UPON A VOICE VOTE, ALL MEMBERS VOTING AYE, VICE - CHAIRPERSON
SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY.
ADJOURNMENT:
MOTION by Ms. Gabel, seconded by Mr. Meyer, to adjourn the HRA meeting.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE SEPTEMBER 3, 1998, MEETING OF THE HOUSING AND
REDEVELOPMENT AUTHORITY ADJOURNED AT 9:50 P.M.
I spectfully/�subQmitted,
d'YYlG�1�GL (0, �U&. 4�
amara D. Saefke (�
Recording Secretary
DATE: September 25, 1998
MEMORANDUM
HOUSING
AND
REDEVELOPMENT
AUTHORITY
TO: William W. Bums, Executive Director of HRA 0 PX
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Consider Participation in the North Metro Home and Garden Fair
The Cities of Arden Hills, Blaine, New Brighton, and Mounds View are in the process of
organizing a joint remodeling fair for February 1999. The fair is tentatively scheduled
for Saturday, February 6, 1999, at the new Mounds View Community Center. The
multi -city remodeling fair is an outgrowth of the 1 -35 W study group that includes a
number of cities along Interstate 1 -35 W in the north metro area. Although not a
member of the study group, Fridley was asked to participate in the North Metro fair due
to its proximity to the sponsor cities and its previous experience with remodeling fairs.
Due to the relatively short timetable, the organizing committee is asking for
commitments from each participating city by early October. Each city would contribute
$2,000 for the event and the money would be used to pay for such things as marketing,
booth rental, postage, a part-time event coordinator, printing, etc. The requested
amount is less than previous HRA expenditures for a typical fair (roughly $8,500 per
fair).
The concept of a multiple city fair has been discussed at the staff level for a couple of
years. The last two fairs have seen lower attendance and a lack of sponsorships by
local home improvement companies. Although the fair has received good comments
from residents, staff is concerned that growing competition from other cities may result
in fewer contractors and vendors.
The advantages of a joint fair are:
1. A multi -city fair is likely to draw more people and therefore be more attractive to
potential vendors, sponsors and other participants.
1
North Metro Home and Garden Fair
September 25, 1998
Page 2
2. A multi -city approach allows for both the sharing of costs and administrative
responsibilities. The fair takes a tremendous amount of time to plan and
organize. Further, it is difficult to ask community development department
staff to volunteer their time on a weekend.
3. Joining forces avoids potential scheduling conflicts that would result if each city held
their own fair.
The disadvantages of a joint fair are:
1. This particular fair has no track record or experience (with the exception of Fridley)
that can be used to draw in contractors and other vendors.
2. Moving the fair outside of the city may reduce the number of Fridley residents who
will attend.
3. Holding the event in the February might be too early in the season when people
might not be as interested in attending.
After evaluating these issues, we believe it is worthwhile pursuing a joint fair in 1999. If
the combined fair isn't successful, we always have the option of conducting our own fair
in 2000.
Recommendation
Staff recommends that the Authority adopt the attached resolution authorizing
participation in the North Metro Home and Garden Fair and a financial contribution of
$2,000.
gf
M -98 -199
1 -A
HRA RESOLUTION NO.
A RESOLUTION AUTHORIZING PARTICIPATION IN THE 1999 NORTH METRO
HOME AND GARDEN FAIR AND A FINANCIAL CONTRIBUTION OF $2,000.
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 authorize participation in the 1999 North
Metro Home and Garden Fair (the "Fair ") with the cities of Mounds View, New
Brighton, Blaine and Arden Hills (the "Participating Cities ") and contribute
$2,000 toward the costs of the Fair.
Section 2. Findings
2.01 The Authority hereby finds that participation in the Fair is consistent with the
goals of its housing program to help improve the condition and livability of
Fridley's housing stock through education and the sharing of information.
2.02 The Authority hereby finds that the most cost - effective and efficient means of
conducting a remodeling fair is to combine efforts with the Participating Cities.
2.03 The Authority hereby finds that it is necessary to make a financial contribution to
assist in the planning, organizing and production of the Fair.
Section 3. Authorization to Participate and Make Financial Contribution
3.01 The Authority hereby authorizes participation in the Fair and a financial
contribution of $2,000.
PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOTA, THIS
DAY OF '199
LAWRENCE R. COMMERS - CHAIR
ATTEST:
WILLIAM W. BURNS - EXECUTIVE DIRECTOR
1 -B
TO: FRIDLEY H.R.A
FROM: CITY OF FRIDLEY
RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES
SEPTEMBER 1998
ADMINISTRATIVE BILLING:
ADMINISTRATIVE PERSONAL SERVICES
ADMINISTRATIVE OVERHEAD
COMPUTER OVERHEAD
(For Micro & Mini computers)
TOTAL ADMINISTRATIVE BILLING:
OPERATING EXPENSES:
LISPS - POSTAGE
SNYDER'S -FILM PROCESSING
US WEST - TELEPHONE
USPS - POSTAGE
CITY - INS ALLOC, JAN -AUG
Account Vs for
HRA's Use
Account Vs for CR
City's Use Code
TOTAL OPERATING EXPENSES:
BENEFITS EXPENSES:
CITY OF FRIDLEY - HEALTH INS 262 - 0000 - 219 -1001
CITY OF FRIDLEY - DENTAL INS 262 - 0000 - 219 -1100
CITY OF FRIDLEY - LIFE INS 262- 0000 - 219 -1200
TOTAL BENEFITS EXPENSES:
TOTAL EXPENDITURES - SEPTEMBER 1998
File: \EXDATA\HRA \TIF\98BILL.xis Details
2
97. 91.83
0.00 236- 0000 - 219 -1001 11
0.00 236- 0000 - 219 -1100 12
3.50 236 - 0000 - 219 -1200 13
W.1
21, 006.58
101- 0000 - 341 -1200
HI
292.58
101- 0000 - 336 -3000
HA
212.42
101- 0000 - 336 -3000
HA
100 - 0000 - 430 - 4107
21.511.58
262 - 0000 - 430 -4332
23.94
236- 0000 - 336 -3000
HA
100 - 0000 - 430 -4221
9.14
236- 0000 - 336 -3000
HA
100 - 0000 - 430 -4332
23.83
236 - 0000 - 336 -3000
HA
100 - 0000 - 430 -4332
8.92
236 - 0000 - 336 -3000
HA
100 - 0000 - 430 -4336
7,926.00
236- 0000 - 336 -3000
HA
TOTAL OPERATING EXPENSES:
BENEFITS EXPENSES:
CITY OF FRIDLEY - HEALTH INS 262 - 0000 - 219 -1001
CITY OF FRIDLEY - DENTAL INS 262 - 0000 - 219 -1100
CITY OF FRIDLEY - LIFE INS 262- 0000 - 219 -1200
TOTAL BENEFITS EXPENSES:
TOTAL EXPENDITURES - SEPTEMBER 1998
File: \EXDATA\HRA \TIF\98BILL.xis Details
2
97. 91.83
0.00 236- 0000 - 219 -1001 11
0.00 236- 0000 - 219 -1100 12
3.50 236 - 0000 - 219 -1200 13
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4
MEMORANDUM
HOUSING
REDEVELOPMENT
AUTHORITY
DATE: September 25, 1998
TO: William W. Burns, Executive Director of HRA'"
FROM: Barbara Dacy, Community Development Director
Grant Femelius, Housing Coordinator
SUBJECT: Reconsider Acquisition of 5859 3`d St. NE
At the September 3, 1998, meeting, the HRA tabled consideration of this item pending
a review appraisal of the property. Staff has ordered a review appraisal of the property
and will provide a report of the findings and a recommendation at the October 1s' HRA
meeting.
gf
M -98 -201
3
MEMORANDUM
HOUSING
AND
REDEVELOPMENT
AUTHORITY
DATE: September 25, 1998 �,,�
TO: William W. Bums, Executive Director of HRA 401
FROM: Barbara Dacy, Community Development Director
Grant Femelius, Housing Coordinator
SUBJECT: Proposal by Affordable Suburban Housing to Develop a Vacant Lot
at 5800 2nd Street
Affordable Suburban Housing, Inc., a non - profit housing developer based in
Bloomington, is interested in purchasing and developing the vacant lot at 5800 2nd
Street. Their goal is to construct a new home that would be made available for sale to
a moderate income, first -time buyer. Currently, this is defined as 80% of median
income or approximately $45,000 for a family of four.
The developer would be required to meet all of the HRA's customary requirements
including pre - selling the lot to a qualified buyer, submitting house plans for HRA
approval which meet the design criteria, and execution of a contract for private
development. There is, however, one distinction that would be required in order to
make the home affordable to a first -time buyer. The HRA typically requires cash up
front for the lot. Under this proposal, the HRA would sell the lot for $1.00 and then take
out a second mortgage for the land cost ($22,000). Payment of the second mortgage
would be deferred until the home is sold or is no longer occupied by the original buyer.
Again, the goal of this proposal is provide a moderate income family with the
opportunity of owning a new home. Obviously, the family must be able to.qualify for a
mortgage loan to buy the house, but deferring the land cost reduces the overall
mortgage required and helps keep the monthly payments affordable.
The developer recently constructed two homes in Richfield under the same terms and
conditions.
The advantage to this approach is that the HRA can redevelop a site which has been
difficult to market. The lot is located adjacent to several small multiple family buildings.
The lot has been on the market for over a year and no offers have been made on the
site. Callers have noted that the adjacent properties make it less desirable than other
lots in the neighborhood.
4
New Home, Proposal
September 25, 1998
Page 2
Bill Schatzlein, Executive Director of Affordable Suburban Housing, will be in
attendance to answer questions about his proposal.
•t •. •i
Unless otherwise directed, staff will proceed with negotiations to sell the lot as outlined
above to Affordable Suburban Housing, Inc. The developer would be required to sign
a participation agreement reserving the site for up to 60 days during which time he
would find a buyer and draft house plans. A complete package, including a house plan,
specs and a development contract would be brought back to the HRA for their review
sometime in November or December.
gf
M -98 -202
4 -A
,Sc EP -24 -98 THU 02:05 PM SCHATZLEINa ASSOCIATES 612 835 5498 P.01
CONN'k
Affordable Suburban Housing, Inc.
A non-profit housing corporation
Bill Schatilein Telephone (612) 835 -5498
Executive Director Fax (612) 835 -4586
10306 Morris Road
Bloomington. MN 55437
September 24, 1998
Mr. Grant Fernelius, Housing Coordinator
City of Fridley
Fridley Municipal Center
6431 University Ave. N.E.
Fridley, MN. 55432
Dear Mr. Fernelius:
Affordable Suburban Housing, Inc. is a non - profit housing corporation established in
1990. We have a New Construction Single Family Affordable Housing Program.
We propose to build a new home under this program in Fridley on the lot the Housing
Authority has available at 5800 2nd Street. The way the program has worked in
Richfield is that ASH agrees to sell the home to a first time home buyer with income
that does not exceed 80% of the median income for the area. The HRA provides the
buyer with a second mortgage in an amount equal to the value of the land. The second
mortgage has no interest and no payments are made. The second mortgage is due if
the buyer no longer occupies the property, or sells the property.
ASH would reserve the lot from the HRA, find a buyer that is qualified, work with a
builder, the buyer, and the HRA to find a house plan that meets the buyers needs, fits
on the lot, and is compatable with the surrounding neighborhood. ASH would also
work with the buyer, and a mortgage company, to have the buyer pre - qualified for a
first mortgage. All of the elements of the transaction would be presented to the HRA for
their approval, and authorization to enter into a redevelopment contract with ASH.
ASH would purchase the lot from the HRA in order to own it during construction. At the
final closing the buyer would sign a first mortgage with the mortgage company, and a
second mortgage with the HRA.
SEP -24 -98 THU 02:06 PM SCHATZLEIN*ASSOCIATES 612 835 5498
2.
ASH builds a good quality single family home. This method of financing makes the
home much more affordable for the buyer. By borrowing the cost of the land from the
HRA the buyer saves on the interest cost, the down payment, and the closing costs.
Please let me know if the HRA would be interested in this type of affordable new single
family housing program. If they are interested we can proceed to work with you on the
details in order to implement this program in Fridley. I look forward to working with you.
Sincerely,
Bill Schatzlein
Executive Director
4 -C
oSEP -24 -98 THU 02:07 PM SCHATZLEINFASSOCIATES 612 835 5498 P.03
Affordable Suburban Housing, Inc. -
A iron profil howing corporation
SOLD AND UNDER CONSTRUCTION
The list price is $140,500 but the City of Richfield will provide a second mortgage of
$26,000 which allows the buyer to pay only $114,500 at closing ( subject to final
approval by the Richfield Housing and Redevelopment Authority). This second
mortgage carries no interest charge. The principal balance on the second mortgage
will be due upon sale of the home in the future. Since 95% financing is available, a
down payment of $5725 and approximately $3500 in closing cost is all that is required.
Potential. buyers qualify for this outstanding opportunity based on the size of their
families and their income level. For example,.buyers with four family members earning
no more than $48,640 are eligible for consideration. Call Executive Director Bill
Schatzlein at the number listed below for more information.
Property Description:
Home size 1,125 sq. ft.
` Attached double car garage
' Full Basement
' 1.5 bathrooms
Lot size 134 ft. x 50 ft.
Partial brick front
' Maintenance - free vinyl siding
' Walk -in closets
ROOM Dimensions:
Living Room
" Kitchen
Dining Room
' Bedroom
" Bedroom
` Bedro :m
Contact:
12'6 "x15'6"
11'6 "x 8'0"
7' 6" x 10' 0"
12'0 "x10'0"
8'6 "x12'0"
9'6 "x10'6"
Bill Schatzlein
835 -5498
6320 15th Avenue So.
4 -p Richfield, Mn.
MEMORANDUM
HOUSING
AND
REDEVELOPMENT
AUTHORITY
DATE: September 24, 1998
TO: William Burns, Executive Director of HRA rf
FROM: Barbara Dacy, Community Development Director
SUBJECT: Consider Resolution Authorizing Execution of a Letter of Intent
with Medtronic, Inc.
Background
At the September 3, 1998, HRA meeting, the HRA passed a motion approving the
terms of the development contract based on the memo prepared by staff dated
September 3, 1998. The HRA conditioned the action on review and approval by the
Chairperson.
On September 4, 1998, staff discussed the terms with Chairperson Commers. He
suggested that a letter of intent be prepared and signed by Medtronic. Since that time,
the Medtronic officials have suggested clarifications to the terms of the September 3,
1998, memo to be incorporated in the letter of intent.
Medtronic officials have signed the letter of intent as of Thursday, September 24, 1998.
Letter of Intent
There were no changes to the financial terms of the contract (i.e., land sale or tax
increment ratios). Most of the changes are clarifications but to follow is a bullet
summary of the more substantive changes:
• Paragraph 4: The amount of land to be conveyed to Medtronic for each phase has
been clarified to differentiate between buildable and unbuildable square footage.
The HRA will convey 1.9 square feet of land for each square foot of building (1.9 is
the result of dividing the net average of the site by 750,000 square feet of building).
5
Medtronic Letter of Intent
September 24, 1998
Page 2
In addition, the HRA will provide up to approximately 27% of additional land for
streets, ponds, or other uses at no cost to Medtronic.
Paragraph 12: Medtronic may utilize the "Alternative Urban Area -wide Review"
(AUAR) procedure in the State's Environmental Quality Board rules. This procedure
is an alternative to a typical environmental impact statement. The purpose of an
AUAR is to evaluate the impacts of development in an area or corridor, especially
when phasing or project timing is not well defined. Staff will be meeting with
Medtronic officials and their environmental attorneys on Thursday, October 1, 1998,
about this alternative. An additional update can be provided at Thursday's meeting.
Paragraph 34: An additional sentence has been added to paragraph 34 to suggest
that the City would support any suitable alternative for additional access (including a
full intersection) to the existing Rice Creek campus facility from Highway 65,
assuming it meets state and county guidelines and is recommended by a mutually
agreeable traffic consultant.
Once the letter of intent is approved by the HRA, the next step is to prepare the
development contract. Medtronic officials must now decide how large the campus will
be in order to determine the appropriate environmental review procedure.
Recommendation
Staff recommends that the HRA approve the attached resolution and authorize the
Executive Director and Chairperson to execute the Letter of Intent from Medtronic, Inc.,
dated September 24, 1998.
BD:Is
M -98 -200
5 -A
HRA RESOLUTION NO.
A RESOLUTION AUTHORIZING EXECUTION AND DELIVERY OF A
LETTER OF INTENT BY AND BETWEEN THE HOUSING AND
REDEVELOPMENT AUTHORITY IN AND FOR THE CITY FRIDLEY,
MINNESOTA AND MEDTRONIC, 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 Letter of Intent (the "Letter ") with
Medtronic, Inc. (the "Redeveloper ").
Section 2. Findings.
2.01. The Authority hereby finds that it has approved and adopted a development program known
as the Modified Redevelopment Plan for its Redevelopment Project No. 1 (the
"Redevelopment Program ") pursuant to Minnesota Statutes, Section 469.001 et seq.
2.02. The Authority hereby finds that the Contract promotes the objectives as outlined in its
Redevelopment Program.
Section 3. Authorization for Execution and Delivery.
3.01. The Chairman and the Executive Director of the Authority (the "Officers ") are hereby
authorized to execute and deliver the Letter with such additions and modifications as the
Officers may deem desirable or necessary as evidenced by their execution.
PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY IN
AND FOR THE CITY OF FRIDLEY, MINNESOTA, THIS DAY OF
199
LAWRENCE R. COMMERS - CHAIRMAN
ATTEST:
WILLIAM W. BURNS — EXECUTIVE DIRECTOR
G : \WPDATA*'FRMLEY\20 \DOMCONTRACT RESOLUTION.DOC
-M
Medtronic Q
September 24, 1998
Housing and Redevelopment Authority
in and for the City of Fridley, Minnesota
6431 University Avenue Northeast
Fridley, MN 55432
Attn: Lawrence R. Commers, Chairperson
William W. Burns, Executive Director
Re: Letter of Intent
Dear Messrs. Commers and Burns:
Medtronic, Inc.
7000 Central Avenue NE
Minneapolis, MN 55432 -3576 USA
Internet: www.medtronic.com
Telephone: (612) 514 -4000
This Letter of Intent is to confirm Medtronic's intention to acquire from the Housing
and Redevelopment Authority the Fridley Executive Center site (the "Site ") under the
following terms and conditions:
The HRA will retain ownership of the Site until such time that Medtronic
exercises its options to acquire additional land.
2. Medtronic will start construction of its first building before July 1, 1999, and the
building must be completed as of December 31, 2000. If the building is not
completed on that date, then it will pay taxes as though it were completed. Taxes
will be paid in the form of a payment in lieu of taxes (PILOT) directly to the HRA
with the first PILOT payable in 2002 calculated as follows:
A market valuation of $13.5 million x the class rates in effect for the applicable
years (currently 3.5 percent) x the tax rates of all the taxing jurisdictions in which
the property is located (in our assumptions we have averaged the tax rates of the
last five years and the result is 1.3242) x 20 percent. An example is as follows:
$13.5 million x 3.5% x 1.3242 x 20% _ $125,137.
3. The land price for the first building will be $1.00.
4. The HRA will provide a net of 1.903 square feet of land for each square foot of
building. The HRA will also provide up to approximately 27% of additional land
for streets, easements and related uses. Medtronic's options will apply to the
entire Site including the area that was previously designated as commercial. 1.903
is the result of dividing 1,427,461 square feet by 750,000. The land acquired and
the land retained by the City shall be in reasonably sized parcels subject to the
acknowledgement by the City that if Medtronic's first phase includes its corporate
5 -C
c
4
Housing and Redevelopment Authority
In and for the City of Fridley, Minnesota
September 24, 1998
Page 2
headquarters executive offices, Medtronic may need more land surrounding such
building and at the entrance to the project to obtain a type of presence suitable to a
corporate headquarters location.
5. In order for Medtronic to maintain its option rights, it must have built or have
under construction the following aggregate amount of building area at the
following times:
a) 150,000 gross square feet by July 1, 1999.
b) 240,000 gross square feet by June 1, 2003.
c) 400,000 gross square feet by June 1, 2006.
d) 500,000 gross square feet by June 1, 2008.
If Medtronic does not meet the minimum building square foot threshold
requirements described above, Medtronic may purchase the remaining land at
$3.00 per square foot as adjusted by the Consumer Price Index (CPI). The CPI
adjustment will be prorated for each month and will commence the later of the
actual closing date or April 1, 1999. This option does not apply unless a
minimum of 240,000 aggregate gross square feet of building has been constructed
and/or is under construction prior to the purchase date. The purchase price
payments belong to the HRA and are not to be treated as tax increment for the
purposes of the Redevelopment Contract.
For the purposes of this section, construction shall be deemed to have commenced
if the footings or foundations for the space referred to in the building permit has
been completed subject to unavoidable delays.
Listed below are some examples:
a) One 150,000 square foot building is constructed and there is nothing
further under construction on May 31, 2003. Medtronic loses all
option rights as of May 31, 2003, and the City/HRA can develop the
remainder of the Site as they deem appropriate.
b) 200,000 square feet of building has been constructed and there is no
additional construction as of May 31, 2003. Medtronic loses all option
rights as in example "a" above.
c) Medtronic has constructed or commenced construction on an aggregate
of 250,000 gross square feet of building but there is no additional
construction as of May 31, 2006. Medtronic has the right to acquire
5 -D
Housing and Redevelopment Authority
In and for the City of Fridley, Minnesota
September 24, 1998
Page 3
the balance of the Site at $3.00 a square foot as adjusted by the CPI
and must exercise its option prior to June 1, 2006.
d) Medtronic has constructed or commenced construction on an aggregate
of 450,000 gross square feet of building (assuming above thresholds
are met) and does not have any additional building under construction
as of May 31, 2008. Medtronic has the option to purchase the balance
of the land at $3.00 per square foot as adjusted by the CPI and must do
so prior to June 1, 2008.
6. Assuming the construction thresholds are met, whenever Medtronic exercises an
option to acquire additional land it will pay the HRA a land holding payment at
the time of closing calculated as follows:
Commencing one month after closing of the first parcel, an amount equal to
1 /12`x' of 25 (.02083)¢ per month per usable square foot will begin to accrue. This
is a cumulative amount with each month being added to the total. After one year,
the cumulative total would be 25¢ per square foot; after the second year 50¢, after
the third year 75¢ and so forth.
An example of these calculations are as follows:
Medtronic needs land to construct a 100,000 square foot facility. The Authority
provides 190,300 square feet of land 48 full months after the conveyance of the
first parcel (100,000 x 1.903 the agreed land to building ratio) x $1.00 (25 _ 12) x
48) _ $190,300.
The land holding payments will not apply to land purchased pursuant to paragraph
5 above.
Medtronic may acquire portions of the Site for the land holding payments any
time it needs additional land for the construction of its buildings (again assuming
the space threshold requirements are met). Once it has constructed or commenced
construction on an aggregate of 500,000 gross square feet of building(s),
Medtronic may, at any time prior to June 1, 2008, purchase the remaining Site or
it will lose its options rights and the City/HRA may develop the balance of the
Site as they deem appropriate, provided the remaining development shall be
consistent with a first class suburban office park with minimum building quality
standards as described in paragraph 32. Medtronic shall make such payments for
"usable" square footage only.
5 -E
c
. � a
Housing and Redevelopment Authority
In and for the City of Fridley, Minnesota
September 24, 1998
Page 4
7. Tax increment that is generated from any development on the Site (either office or
commercial) will be allocated as follows:
The Authority shall retain 20% of the increment until the it has recovered the
present value of $3.3 million calculated at a present value, based on an interest
rate of 6.75% compounded annually from April 1, 1999. Once a present value of
$3.3 million has been achieved, then the HRA will retain 2.5% of the tax
increment with Medtronic receiving 97.5 %.
8. Medtronic will only spend the tax increment it receives from the HRA on any
statutorily authorized eligible expenditure including but not limited to the
following:
a) Parking.
b) Road and utility realignments.
c) Street Lighting.
Medtronic's expenditures for qualifying expenses shall also accrue interest at
6.75% from the date of such expenditure, compounded annually, and Medtronic
shall be entitled to reimbursement from its share of TIF proceeds until all such
qualifying expenditures and the accrued interest thereon, has been paid.
9. The parking requirements will be the normal City requirements of four cars per
1,000 rentable square feet of "office" building area.
10. Seventy-five percent (75% ) of the parking spaces for the first building must be
constructed as structured parking. Subsequent buildings shall provide for a
minimum of 85% of the parking spaces to be constructed as structured parking.
Grade level parking spaces within or beneath parking structures are, for the
purposes of this section, considered included in structured parking.
11. The building Site coverage shall be in accordance with the City zoning
requirement or as provided for in a PUD and the ratio may be up to 40 %.
12. The City/HRA agree that the Site is suitable for the construction of 1.6 million
square feet of development. Medtronic acknowledges that the site has been
previously approved and permitted for approximately 750,000 square feet of
development which the City/HRA believes can be modified to approximately 1
million square feet with environmental review. If Medtronic wishes to have
additional development on the Site (above 1,000,000 square feet) then the
5 -F
Housing and Redevelopment Authority
In and for the City of Fridley, Minnesota
September 24, 1998
Page 5
d
City/HRA will cooperate in every way possible to achieve the maximum
allowable density on the Site. The City/HRA and Medtronic understand further
that other regulatory agencies will be involved in the final determination.
However, to the extent that Medtronic (or other suitable entity) prepares an
Environmental Impact Statement ( "EIS ") or an Alternative Urban Area -wide
Review ( "AUAR ") the City will support such request. Any costs to obtain
approvals in excess of 750,000 square feet from environmental regulators will be
the responsibility of Medtronic but the City will provide Medtronic with the work
it has already completed.
The City acknowledges that Medtronic may immediately seek approval of an EIS
or AUAR for up to 1.6 Million square feet of building area on the site. If
Medtronic chooses to do so, the City shall use reasonable efforts to cooperate with
and to expedite its work with respect to such EIS or AUAR. The City further
agrees that the closing of the first parcel of land may be postponed until
satisfactory approval of such EIS or AUAR and such postponement would be an
unavoidable delay event as referenced in paragraph 5.
13. The City will approve a building height of up to 10 stories for buildings within the
project. The overall height of such building(s) shall be high enough to permit a 15
foot clear 1" level (finished to the bottom of a completed ceiling) and 10 foot
clear (finished below a completed ceiling for each other level). In addition
Medtronic shall be able to place mechanical equipment (HVAC etc.) on the roof
of the building in accordance with the City's building code.
14. Medtronic can locate its first building anywhere on the Site. However, its location
must allow the remainder of the Site to achieve 750,000 gross square feet of
development (which includes all Medtronic buildings constructed or under
construction) and there must be no unbuildable parcels. The 750,00 square feet
assume that approximately 20% of the gross area of the Site which is 41.63 acres
will be unbuildable and that the City/HRA will provide the necessary easements
on the unbuildable land to facilitate the development on the buildable land. The
City/HRA recognize that Medtronic will not have to pay for more than 1,427,461
square feet of land less the land received for the first building in accordance with
paragraphs 3 and 4.
15. Permitted uses on the Site for Medtronic shall be the same as its uses at the Rice
Creek Campus which include the following:
a) Light assembly of any products Medtronic sells from time to time.
b) Research and development activities.
5 -G
R
Housing and Redevelopment Authority
In and for the City of Fridley, Minnesota
September 24, 1998
Page 6
c) Some warehousing activities (needed for its product assembly on the
Site).
d) Conference and training facilities.
e) Office activities and reasonably related uses.
f) Uses reasonably incident to a primary or secondary headquarters facility
for a United States manufacturing company.
g) Retail uses to the extent indicated in paragraph 18.
Medtronic intends to use the Site primarily for office purposes.
16. Medtronic will have the right to add to, realign or vacate portions of the roads and
utilities at its expense. Medtronic must meet City engineering standards and pay
for any costs associated with the realignment including survey and platting costs.
17. The existing roads are currently intended to be City streets. At Medtronic's
request, the City will convey the streets to Medtronic. Medtronic will be
responsible for the maintenance of any streets conveyed to it; the City will be
responsible for the maintenance of any streets it retains. Any roads which
Medtronic constructs on the Site and which meet City standards for public streets
may be conveyed to the City (or not purchased by Medtronic) and the City shall
thereafter maintain such roads as public streets. Medtronic shall not be required to
pay for the land area required for any roadways.
18. Medtronic may develop a portion of the Site for commercial uses in accordance
with the following conditions:
a) Commercial uses include hotel facilities, convention facilities, daycare
facilities, financial institutions and sit -down restaurants.
b) The amount of usable land area to be used for commercial use shall be
limited to 356,866 square feet (inclusive of parking for such use).
c) There will be no sale of land for such uses until Medtronic has constructed
or commenced construction of 240,000 gross square feet of building space.
d) Land will be sold at $6.00 per square foot as adjusted by the CPI described
in paragraph 5. The HRA will accept a corporate note (the "Note ") in the
5 -H
Housing and Redevelopment Authority
In and for the City of Fridley, Minnesota
September 24, 1998
Page 7
amount of the purchase price (less the payment required under paragraph
6) bearing an interest rate of 6.75% per annum commencing with the
closing date of such sale. The principal and interest on the Note shall be
paid in full on the date the Medtronic options or rights expire because
Medtronic has not satisfied a construction threshold requirement which
shall be either June 1, 2006, or June 1, 2008, as described in paragraph 5.
The Note and all accrued interest thereon shall be waived and deemed paid
in full on the date that Medtronic has timely satisfied the 500,000 square
foot construction threshold requirement. [Note that the structure of this
obligation may have to change to avoid Medtronic having a taxable event
as a result of cancellation of indebtedness income upon meeting the
500,000 gross square foot threshold.]
e) The land holding payment described in paragraph 6 must be paid.
19. The normal City requirements will apply to the issuance of building permits,
provided, however, the City will expedite the permitting and plan approval
process to the greatest extent possible within the existing statutes regulations and
ordinances.
20. Medtronic will pay the customary City fees for connection charges, building
permits and park dedication.
21. The normal City procedures shall be followed for the approval of the Site plans
and the building plans.
22. A master plan shall be prepared by Medtronic for review and approval by the
HRA, the planning commission and the City council. The master plan shall be
consistent with the terms hereof. The City, the HRA and the planning commission
shall expedite their approval process as provided in paragraphs 19 and 37. Once
the master plan has been agreed to by Medtronic and approved by the City,
planning commission and HRA then the only restrictions on the Site will be those
imposed by the master plan and the normal and customary City zoning and land
use requirements with the restrictions agreed to by Medtronic and the City/HRA
in the Contract for Private Redevelopment.
23. The City/HRA will provide Medtronic will all soil tests and studies that it has in
its possession. Any future studies will be an expense of Medtronic.
24. The City/HRA will provide Medtronic with all environmental studies, tests and
analyses that it has in its possession. Medtronic may do any additional
54
Housing and Redevelopment- Authority
In and for the City of Fridley, Minnesota
September 24, 1998
Page 8
environmental testing it deems appropriate at its expense. Medtronic must
complete its environmental due diligence prior to January 1, 1999.
25. The HRA represents that it has no knowledge of the presence of any hazardous
materials on the Site.
26. The HRA shall provide marketable title to all portions of the Site and shall pay for
a title commitment for the entire Site when it provides the title commitment for
that portion of the Site needed for the first building. The first title commitment
must evidence that the HRA has marketable title and that there are no claims
superior to Medtronic's option on the balance of the Site. In addition, the
Authority shall provide a survey of the entire Site as the Site is currently
constituted. Medtronic shall pay for all costs associated with a survey for the Site
necessary for the first building and all subsequent buildings. Medtronic shall pay
for the title commitment for each subsequent phase and shall pay all costs of re-
platting, lot splits or any other costs associated with the conveyance of subsequent
phases.
27. There will be no minimum valuation agreements.
28. There will be no special assessments for any improvements to the Site prior to the
date of the Redevelopment Contract or for the Highway 65/West Moore Lake
Drive intersection improvements or the University Avenue access improvements.
29. The HRA shall be responsible for the maintenance of the Site to which it retains
title including mowing and watering.
30. The City's prevailing wage ordinance is applicable to the construction of the
improvements to the Site.
31. The City /HRA is responsible for collecting information for the State of Minnesota
regarding wage and job goals. Medtronic needs to provide a reasonable estimate
of the increased employment that may result in the State of Minnesota after the
construction is completed.
32. The minimum building quality standards shall not be less than those used at
Medtronic's Rice Creek Campus or its Shoreview Building or its Neuro facility
adjacent to Sullivan Lake in Columbia Heights.
33. The City/HRA will continue to work with Medtronic to solve the Highway 65
interchange concerns and to allow for the maximum density on the Site.
.. 54
Housing and Redevelopment Authority
In and for the City of Fridley, Minnesota
September 24, 1998
Page 9
34. Rice Creek Campus Intersection on Highway 65: The City/HRA will use their
best efforts to modify the intersection consistent with Medtronic goals and State
and County guidelines. The City will not commit local revenues but will use its
best efforts to secure County, Regional, State or Federal funding to pay for the
intersection improvements. After completion of an analysis of access options to
the West of the Rice Creek facility by a traffic consultant acceptable to the City
and Medtronic, the City agrees to support a full intersection and any other options
that are agreeable with the state and county guidelines and are recommended by
the traffic consultant.
35. University Avenue Access: When development on the Site increases traffic usage
(or can be reasonably expected to increase traffic usage) on 7`h Street (exceeding
MN Dot. standards), then the City and Medtronic will cooperatively design a
traffic plan (the "Traffic Plan") for access to University Avenue that will:
1. Accommodate the increased traffic.
2. Address neighborhood concerns.
3. Be consistent with the City's transportation plans.
Medtronic will not be assessed for any of the improvements necessitated by the
Traffic Plan and the City will implement the Traffic Plan as it has available local
funds and as it secures County, Regional, State or Federal funds for this purpose.
36. Acquisition of additional houses: Provided the statutory authorization for
acquisition of sites is not changed and that the required public purpose findings
can be upheld, the City/HRA will acquire or facilitate the acquisition of 4 -7
houses at the east end of the Site. These houses would be acquired to facilitate a
master plan that would provide for a corporate headquarters office park. Because
of the impact of the residents of these houses, Medtronic must notify the City
within 24 months of the date of the Development Agreement if it needs the City's
participation in the acquisition. Medtronic would be responsible for all costs
involved in the acquisition and transfer of the houses to Medtronic. The
City/HRA will initiate the process whereby it will include the parcels in the City's
Redevelopment Project No. 1.
37. The City/HRA will make a representation that they do not anticipate any
unreasonable design evaluation.
5 -K
Housing and Redevelopment Authority
In and for the City of Fridley, Minnesota
September 24, 1998
Page 10
Please indicate your acceptance and approval of the foregoing statement of our intention,
which intention is subject in all respects to the execution and delivery of the definitive Contract
for Private Redevelopment. This letter does not constitute an offer to purchase the Site, or an
agreement with respect thereto, and shall not create any rights and obligations on the part of the
parties until such Contract for Private Redevelopment is approved by our board of directors and
your board of commissioners.
Very truly yours,
Medtronic Inc.
Its: P a
Accepted and approved this day of September, 1998.
Housing and Redevelopment Authority in and for the City of Fridley, Minnesota
By: By.
Its: Its:
G: \WPDATA\F\FRIDLEY\20 \COR\LETTER OF INTENTDOC
5 -L
DATE: September 25, 1998
MEMORANDUM
HOUSING
REDEVELOPMENT
AUTHORITY
TO: William W. Bums, Executive Director of HRA,7,0
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Housing / Special Projects Intern
We are pleased to report that a finalist has been selected for the Housing / Special
Projects Intern position. Ben Martig is a graduate student at the University of
Minnesota's Humphrey Institute. Ben was selected from a field of twelve students who
expressed interest in the position. - He has spent the last year working for the City of
Cottage Grove as a planning intem while pursuing a Master of Planning degree.
Ben's responsibilities in Fridley will focus on both housing and planning issues.
Initially, he will analyze the impact of the HRA's housing programs on the City and
explore potential changes that might be appropriate to improve the programs. In
addition, he will look at the scattered site redevelopment program and collect
information from other cities who have similar programs. He will also assist with some
of the tasks required to update the City's comprehensive plan.
Technically, he will be employed by the University of Minnesota and the HRA will pay
for only 40% of his time. The HRA's cost will be approximately $6,032 for the internship
program.
Ben will be working 16 hours a week for approximately nine months. He will start work
on September 23, 1998, and have regular office hours Monday through Thursday, from
1:00 p.m. to 5:00 p.m. He will share office space with the remodeling advisor who
works in the mornings. His internship will end in the spring of 1999.
We are pleased that Ben has joined the staff and will provide updates on his progress
in the coming months.
gf
M -98 -203
a
Date: October 1, 1998
To: HRA Commission Members
From: Craig Ellestad, Accountant
Subject: Additional Expenses Needing Approval
VENDOR
Braun Intertec
CEE
Gerloff, Robert
HRA Housing
Lake State Reality
DESCRIPTION
AMOUNT
Soil Testing - 530 & 540 Hugo
1,649.75
3 Orig, 3 Post & Marketing
1,440.00
Remodeling Planbook
12,500.00
3 City Wide Home Loans
25,399.87
Appraisal 5859 3rd St
300.00
File:\EXDATAXHRA\MISCW DD- EXP.)ds
Total: $41,289.62
.r
Fridley HRA
Monthly Housing Program Summary
October 1, 1998
1. Loan Origination Report
Covers the loans and grants issued in 1998, through 9- 25 -98. This report
shows activity both city -wide and in the Hyde Park neighborhood.
2. Loan Servicing Report
Covers HRA funded loans only. Report summarizes all of the loans being
serviced (including prior years) by the Community Reinvestment Fund
(CRF) for the most recent reporting period, 8- 31 -98.
3. Delinquent Loan Report (see attached memo)
Report shows the number of loans that are considered delinquent. There
are four categories (1 month, 1 -2 months, 2 -3 months, over 3 months).
The report also shows the total amount of delinquent payments along with
the total loan principal outstanding. Report covers activity through
8- 31 -98.
4. Other Information
None
Monthly Housing Report Cover (9 -25-98 HRA)
IN
LOAN ORIGINATION REPORT
Month Ending
Sep -98
Cft-Wid_e Loans and Gran
Total $ 9,277.18 1 $ - - $ 5,415.08 1 $ 14,69226 2
$ 489,652.82 36 $ 5,897.00 1 $ 38,044.00 3 $ 533,593.82 40
1998 (AUG) LOAN ACTMTY REPORT
LO.R. -AUG 1999
9/23198
I
HRA
MHFA
CDBG 'HOME
Date
Type of
Name
Address
Loans
Loans
Grants
Total
Closed
Property
Program
Reineck 143 - Horizon Circle $ 23,978.98 1 $ $ $ 23,978.98 1 127/98 Single - family 5% Loan
Flan 6558 Oakley St. $ 8,800.00 1 $ $ $ 8,800.00 1 3117/98 Single - family 5% Loan
Mahoney 261-67th Ave. NE $ - $ - $13,383.00 1 $ 13,383.00 1 3/9/98 Single - family CDBG Grant
Ecker 6380 Stariite Blvd. $ $ $ 9,621.00 1 $ 9,621.00 1 1/16/98 Single - family CDBG Grant
Marciniak 601 - 58th Ave. NE $ $ $15,040.00 1 $ 15,040.00 1 328/98 Single - family CDBG Grant
Harlander 136 - River Edge Way $ 25,000.00 1 $ $ $ 25,000.00 1 421/98 Single - family 5% Loan
Van Auken 1475 - 73rd Ave. NE $ 6,000.00 1 $ $ $ 6,000.00 1 423/98 Single - family 5% Loan
Marciniak 617 - Hugo St. NE $ 4.922.86 1 $ $ $ 4,922.86 1 515/98 Single - family 5% Loan
Hinrichs 7355 Hayes St. NE $ 3,900.00 1 $ $ $ 3,900.00 1 515/98 Single - family 5% Loan
Dirkes 680 - Ironton St. NE $ 2,400.00 1 $ $ $ 2,400.00 1 5/5/98 Single- family 5% Loan
Dougherty 7420 Concerto Curve $ 16,118.19 1 $ $ $ 16,118.19 1 5/12/98 Single- family 5% Loan
Bailey 1828 Gardena Ave. NE $ 9,900.00 1 $ $ $ 9,900.00 1 5/19/98 Single -family 5% Loan
Nelson 7530 Tempo Terr. $ 13,35525 1 $ $ $ 13,35525 1 5119/98 Single-family 5% Loan
Zelenak 7526 - 4th St. NE $ 7,500.00 1 $ $ $ 7,500.00 1 5/19198 Single- family 5% Loan
Kok 6517 McKnley St. NE $ 23,077.00 1 $ $ $ 23,077.00 1 5/19/98 Single - family 5% Loan
Miller 591 - Dover St. NE $ 25,000.00 1 $ $ $ 25,000.00 1 528/98 Single - family 5% Loan
Smith 4610 2 -12 St. NE $ 12,400.00 1 $ $ $ 12,400.00 1 62198 Single - family 5% Loan
Gunia 117 - Alden Circle $ 25,000.00 1 $ $ $ 25,000.00 1 6098 Single- family 5% Loan
Cannon 6750 Monroe St. NE $ 23,287.73 1 $ $ $ 23,287.73 1 619/98 Single-family 5% Loan
Borman 120 River Edge Way $ 23,923.94 1 $ $ $ 23,923.94 1 6/9/98 Single - family 5% Loan
Maki 7341 Concerto Curve $ 3,775.00 1 $ $ $ 3,775.00 1 6130198 Single family 5% Loan
Harff 1311 - Creek Park Ln. $ 20,000.00 1 $ $ $ 20,000.00 1 6130/98 Single family 5% Loan
Leslie 600 - Hugo St. $ 24,425.00 1 $ $ $ 24,425.00 1 721/98 Single family 5% Loan
Peterson 6757 Washington St. $ 10,000.00 1 $ $ $ 10,000.00 1 721/98 Single family 5% Loan
Nelson 250 - 61st Ave. S 22,940.12 1 $ $ $ 22,940.12 1 721/98 Single family 5% Loan
Klein 5974 - 4th St. $ 23,270.00 1 $ $ $ 23,270.00 1 7130/98 Single family 5% Loan
Jacob 6251 Rainbow Dr. $ 11,500.00 1 $ $ $ 11,500.00 1 8/4/98 Single family 5% Loan
Berg 5624 - Innsbruck CL N $ 2,385.00 1 $ $ $ 2,385.00 1 814/98 Single family 5% Loan
Anderson 6442 Van Buren St. $ 1,106.00 1 $ $ $ 1,106.00 1 814/98 Single family 5% Loan
Simonson 800 Pandora Dr. $ 22,260.00 1 $ $ $ 22,260.00 1 814/98 Single family 5% Loan
Johnson 6800 Monroe St. $ - $5,897.00 1 $ $ 5,897.00 1 814/98 Single family MHFA Loan
Hamm 563 - Janesville St. $ 6,133.00 1 $ $ $ 6,133.00 1 8/11/98 Single family 5% Loan
Bartlett 5085 Topper Ln. $ 10,93729 1 $ $ $ 10,93729 1 8111198 Single family 5% Loan
Hendrickson 6431 Baker St. $ 13,085.00 1 $ $ $ 13,085.00 1 8131/98 Single family 5% Loan
Notsch 1020 Lynda Dr. $ 15.940.00 1 $ $ $ 15,940.00 1 9/1/98 Single family 5% Loan
Stolle 6005 - 5th St. $ 12,655.41 1 $ $ $ 12,655.41 1 9/1/98 Single family 5% Loan
Wilke 6723 - Overton Dr. $ 11,339.87 1 $ $ $ 11,339.87 1 9115/98 Single family 5% Loan
Martin 580 - IGmball St. $ 7,400.00 1 $ $ $ 7,400.00 1 92098 Single family 5% Loan
Prentice 6950 - Hickory Dr. $ 6,660.00 1 $ $ $ 6,660.00 1 922/98 Single family 5% Loan
Total $ 480,375.64 35 $ 5,897.00 1 $ 38,044.00 3 $ 524,316.64 39
Hyde Park Loans and Grants
Name
Address
HRA
Loans
MHFA
Loans
CDBG / HOME
Grants
Total
Date
Closed
Type of
Property
Program
Kroone 5933 Main St. NE $ 9.277.18 1 $ $ - $ 9,277.18 1 623198 Single family 5% Loan
Hughes 6060 - 3rd St. NE $ $ $ 5,415.08 1 $ 5,415.08 1 9115198 Single family CDBG Grant
Total $ 9,277.18 1 $ - - $ 5,415.08 1 $ 14,69226 2
$ 489,652.82 36 $ 5,897.00 1 $ 38,044.00 3 $ 533,593.82 40
1998 (AUG) LOAN ACTMTY REPORT
LO.R. -AUG 1999
9/23198
I
OR
LOAN SERVICING REPORT
Month Ending
August 1998
Installment Loans
Number of Loans in Portfolio 176
Principal Payments $ 14,986.52
Interest Payments $ 8,327.73
Late Fees $ -
$ 23,314.25
Ending Principal Balance 1 $ 2,038,819.98
Deferred Loans
Number of Loans in Portfolio
23
Principal Payments
$
6,286.73
Interest Payments
$
118.11
Late Fees
$
-
$
6,404.84
Ending Principal Balance
$ 112,224.65
Totals
Total Loans in Portfolio
199
Principal Paid
$
21,273.25
Interest Paid
$
8,445.84
Late Fees Paid
$
-
$
29, 719.09
CRF Monthly Servicing Fee
$
921.00
NET FUNDS RECEIVED
$
28,798.09
TOTAL OUTSTANDING LOAN PRINCIPAL 1 $ 2,151,044.63
1998 (AUG) LOAN ACTIVITY REPORT
LSR - JUL 1998
9/23/98
Number of Loans (197)
Total of Payments Due
Outstanding Principal
% of Portfolio
Fridley Loan Program
Loan Delinquencies
9/1/97
16 1 0 5
$ 2,530.55 $ 560.98 $
$ 205,321.63 $12,889.04 $
9.5% 0.5%
File: DELINQUENCIES
Worksheet: LOAN DELIQUENCIES
Date: 9 /23/98
- $ 2,573.03
- $ 46,193.54
0.0% 2.1%
9/23/98
1 to 2
2 to 3
Over 3
1 Month
Months
Months
Months
16 1 0 5
$ 2,530.55 $ 560.98 $
$ 205,321.63 $12,889.04 $
9.5% 0.5%
File: DELINQUENCIES
Worksheet: LOAN DELIQUENCIES
Date: 9 /23/98
- $ 2,573.03
- $ 46,193.54
0.0% 2.1%
9/23/98