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HRA 06/03/2010 - 6254n JUNE 3, 2010 HRA Meeting Regular Meeting Agenda 7.00 n.m. City Hall, Council Chambers Call to order Roll call Action Items 1. Approval of expenditures 2. Approval of May 6, 2010, Meeting Minutes 3. Election of Officers 4. Approval of Housing Replacement Program 5. Approval of Sikh Society Property Purchase Informational Items 1. Home Remodeling Demonstration Program 2. Fridley Assisted Living, LLC (Faulkner project) 3. 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Seconded by Commissioner Gabel. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED 1. Approval of Expenditures MOTION by Commissioner Holm to approve the expenditures as presented. Seconded by Commissioner Meyer. Commissioner Holm said that several items on the report are related to costs associated with 831 Mississippi. He asked if these costs would be categorized under one section to look at upon completion of the project. Paul Bolin, HRA Assistant Executive Director, answered yes. Chairperson Commers asked if those costs have already been approved for that project. Mr. Bolin answered that is correct. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY 2. Approval of March 23, 2010, Meeting Minutes MOTION by Commissioner Meyer to approve the minutes as presented. Seconded by Commissioner Gabel. Commissioner Gabel asked for corrections on pages 2, 3 and 4. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MINUTES APPROVED AS AMENDED. 3. Public Hearing to consider the proposed sale of property to Fridley Assisted Living, LLC MOTION by Commissioner Gabel to open the public hearing. Seconded by Commissioner Eggert. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED AND THE PUBLIC HEARING OPENED AT 7:46 P.M. Paul Bolin, HRA Assistant Executive Director, said HRA has received an offer, from Jim Faulkner / Fridley Assisted Living, LLC, to purchase two vacant properties the HRA has owned since early 2000; 6352 Old Central Avenue and 1271 E. Moore Lake Drive. HRA purchased the , two parcels in early 2000 for a total price of $143,000. The parcels are not buildable in their current state due to the depth of organic soils. Currently over $500,000 is needed to correct soils and the properties have been off tax roles for 10 years. Mr. Bolin said that the Faulkner Group is seeking to obtain the parcels for $100,000. Faulkner will correct soils on both sites upon closing of sale. A senior assisted living project will be constructed upon completion of soil corrections, which will generate nearly $15,000 / year to the City in property tax. The second phase of assisted living will be constructed in the near future, generating additional tax revenue. Mr. Bolin said that this project has received approval from the Planning Commissions on the "master plan" for the site as it is located in an S -2 Redevelopment District. This item goes to City Council May I Oh. Staff recommends sale of the parcels to Mr. Faulkner's group by resolution. The terms of sale are included in the redevelopment agreement Commissioner Holm asked if Mr. Faulkner was in agreement with the terms of the sale. Jim Faulkner answered yes, and he met with Staff prior to the meeting and is in agreement as amended. Jim Casserly, Development Consultant, said that the changes are very minor, the significant change was the name. A closing date was also added along with payment information. Chairperson Commers asked about financing before the closing date. Mr. Casserly said that the lender wants to make sure this will go through. Staff will submit the changes tomorrow and copies will be distributed to members for next weeks for execution. Chairperson Commers asked what happens on a default if the first phase is done and not the second phase. Mr. Casserly said that if the second phase is not completed HRA has no rights to the property. Because the concept changed the commercial portion of this site would not be developed. Chairperson Commers asked what would be developed on this property if the memory care unit is not built. Scott Hickok, Community Development Director, said that a 19 unit memory care facility will be built but if it is not developed the developer would need approval from the Commission and Council to have the master plan amended. Commissioner Meyer asked what happens if phase one is not completed or abandoned like past experiences. Mr. Casserly said that if they start construction there will be a construction loan and HRA subordinated their rights to the construction loan. Commissioner Meyer asked if anything would happen to HRA. Chairperson Commers said HRA would be out of it as the money would be paid up front. Mr. Faulkner said he did not see this issue being a problem, construction will happen on this site. Commissioner Meyer asked how the soil would be improved. Mr. Faulkner said by removing and replacing, no piling. Commissioner Eggert asked when the financing piece would occur. Mr. Faulkner said the financing will be provided at closing. MOTION by Commissioner Gabel to close the public hearing. Seconded by Commissioner Holm. . ,1-� UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED AND THE PUBLIC HEARING CLOSED AT 8:04 P.M. MOTION by Commissioner Eggert to approve the motion to sell the two vacant properties at 6352 Old Central Avenue and 1271 East Moor Lake Drive Fridley Assisted Living LLC. Seconded by Commissioner Gabel. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED 4. Sikh Society Purchase Paul Bolin, HRA Executive Assistant Director, said that the Sikh Society delivered a letter asking that the HRA purchase their property located at 5831 University Avenue. HRA originally made an offer to purchase in 2007 as follows: $450,000 for land and building $ 20,000 for relocation $470,000 total Mr. Bolin said that comparable commercial / restaurant properties have decreased in value by 8 - 11 % since 2007. This parcel is not vital to redevelopment of University Avenue, therefore staff recommends the HRA only acquire for a reduced price of $414,000 + $20,000 for relocation. Chairperson Commers asked for clarification that the proposal is for $414,000 plus $20,000 for relocation. Mr. Bolin said that is staff s recommendation. Commissioner Meyer asked what would happen if the HRA chose not to purchase the property. Mr. Bolin said that HRA would not have the southern property and it would not be included in future redevelopment. In 2007 the actual value the assessors placed on the property was $270,000 but when the appraisal was done, because it was formerly a McDonalds with the kitchen intact and building was in good shape, the higher value remained. It is highly unlikely a restaurant use would go back into the building. Mr. Bolin said that the appraisal of $470,000 is not a real value for HRA but the site could be used as a restaurant because the building is constructed well. The reality is that as a vacant building it is only worth $270,000. If HRA thinks that the price should now reflect the decreased value of what has been happening with commercial restaurant properties, the $414,000 plus the $20,000 would be a more accurate number. Commissioner Eggert asked if this property is adjacent to current holdings which would extend the redevelopment area. Mr. Bolin answered yes, that is correct. Commissioner Gabel said that there are still several other sites that don't belong to HRA. It will be a while before HRA will be in a position to acquire the other pieces of property. There is really no urgency in this matter but if something did come up it would be nice to have this property. Eventually the price will go back up. Commissioner Holm said that the recommendation by staff is generous at $414,000 and HRA could live without that piece of property although it would be nice to have it. He is in favor of acquiring the site to fill out the Northeast Corridor but if the Sikh Society doesn't agree to the lower price it wouldn't be a deal. Commissioner Meyer said that the University Corridor is important to HRA now and in the future. The more HRA can control will benefit HRA in the future. Commissioner Eggert added that looking at future development; if this property is not purchased the property will just sit there. MOTION by Commissioner Holm to approve staffs recommendation to purchase the Sikh Society property for the price of $414,000 plus $20,000 relocation expenses. Seconded by Commissioner Eggert. UPON VOICE VOTE, CHAIRPERSON COMMERS, COMMISSIONER HOLM, COMMISSIONER GABEL AND COMMISSIONER EGGERT VOTING AYE, COMMISSIONER MEYER VOTING NAY, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED ON A 4/1 VOTE INFORMATIONAL ITEMS: 1. HRA Fund Balances for Planning Purposes Paul Bolin, HRA Assistant Executive Director, reviewed the HRA Fund Balances for Planning Purposes and noted highlights of activity in various HRA funds, provided a brief introduction to demonstrate the solvency of the HRA funds and ability to move forward with existing and proposed programs. There will be a work session held to answer specific fund questions in June. Greg Johnson, Financial Analyst, presented an overview of the 2010 HRA Cash Flow Projection. Commissioner Holm asked if there is no increase in the levy if that would mean no increase in the city's finances. Mr. Johnson said that is correct, Chairperson Commers asked how HRA is setting up loans and if a TIF district would be created for the Northstar Area. Jim Casserly, Development Consultant, said that HRA will try to take as much from Districts 11, 12 and 13 that they can. Districts 11, 12 and 13 can be used to repay the loans. Mr. Johnson said that currently there are ten active TIF districts. Commissioner Eggert said that he understands that no debt cash flow works pretty easy but also knows there are times to incur debt and times not to. Mr. Casserly said that the problem today is that HRA doesn't have a project that demands that type of capital investment. Maybe if something will get going around the Northstar that will allow HRA the opportunity to borrow on the capital markets. Right now the rates are extremely low. 2. Housing Replacement Program Paul Bolin, HRA Assistant Executive Director, said the April 6t' Legislation approved reauthorizing of the Housing Replacement Program (HRP). The program allows HRA to purchase up to 100 properties to demolish/rehab and place into a multi- phased scattered site Tax Increment (TI) District. HRA can construct / improve properties up to 150% of the average home value. The tax increment is determined by value of new improvements and requires a 25% non -TI match. Mr. Bolin said that with the unique housing market the housing replacement program requires a new approach. Current housing values are low and there are many investors in the market. Foreclosed properties have multiple offers pending and Staff are preparing a multi - pronged approach for review at the June meeting. Mr. Bolin said that staff has only had one month to digest and interpret the language approved by the legislature. There are many innovative ways to make the program work in the current market conditions. Staff will strive to stretch HRA resources through new partnerships and bring a well developed plan forward for consideration on June 6t'. Commissioner Holm asked if the maximum was 100 properties and what would happen if HRA decided to do 50. Jim Casserly, Development Consultant, said that there would be less than that. This allows an addition for another 78 properties. Commissioner Eggert asked if other cities participated in this program. Mr. Bolin said yes, a meeting was recently attended with other communities and that is how he found out about this program. Chairperson Commers asked if HRA would use the revolving loan to fund this project. Mr. Casserly answered yes, and other resources could be used as well. n 3. Home Remodeling Demonstration Program Paul Bolin, HRA Assistant Executive Director, announced the upcoming open house for the remodeling demonstration program at 831 Mississippi Street. The mid -point open houses will be held Sunday May 23`d from 11AM until 4PM and Wednesday May 26th from 4:30PM until 6:30PM. 4. Housing Loan Program Update Paul Bolin, HRA Assistant Executive Director, reviewed the Fridley HRA Loan Program Summary. In April two RLF Loans were closed which makes a year to date total of four RLF loans and one other loan closed year to date. There have been no remodeling advisor visits yet this year. There may be more demand for remodel visits with the remodeling project going on. This is a free service. NONAGENDA ITEMS: Chairperson Commers asked if staff had any updated numbers of people riding the Northstar. Mr. Bolin said that no official numbers have been received but they are going to do counts in April of actual ridership. Commissioner Meyer said that he also rode the train for a non Twins event and noticed that very few got on or off in Fridley. Commissioner Meyer noted that this is the 45th Anniversary of the Fridley Tornado which brought together the HRA. ADJOURNMENT: MOTION by Commissioner Gabel to adjourn. Seconded by Commissioner Holm. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE MEETING ADJOURNED AT 9:45 P.M. Respectfully Submitted, Krista Monsrud, Recording Secretary n 3 f Fridley Housing and Redevelopment Authority Action Item DATE: May 24, 2010 TO: William W. Bums, HRA Executive Director FROM: Paul Bolin, Assistant HRA Director SUBJECT: Election of Officers Article V, Section 3 of the Authority's by -laws requires the Board of Commissioners to annually elect a Chair and Vice Chair. Below is a list of the commissioners and the length of their current appointments. Commissioner End of Term John Meyer June 2011 Bill Holm June 2012 Pat Gabel (Vice Chair) June 2013 Lary Commers (Chair) June 2014 Stephen Eggert June 2015 Recommendation Staff recommends that the Authority elect a Chair and Vice Chair as required by the Authority's by -laws to serve through June 2011. ,1_*_� INFORMATIONAL ITEM ri HRA MEETING OF JUNE 30 2010 MY OF FRIDLEY Date: May 24, 2010 To: William Burns, City Manager From: Paul Bolin, Asst. Executive HRA Director Subject: _ Re- Authorization of Scattered Site Housing Replacement Proaram Introduction/Backeround The Fridley Housing and Redevelopment Authority (HRA) originally created the Housing Replacement Program in 1995 for the purpose of removing older, substandard housing and replacing it with new housing. The goals of the program are to: 1. Eliminate blighted and substandard homes through demolition. 2. Preserve and expand the City's tax base through new construction. 3. Encourage neighborhood revitalization through re- investment. (" 1 All of the 21 properties, previously acquired by the HRA, were purchased on a voluntary basis directly from the owner or through a foreclosure. Once acquired, the structures were demolished and the lots were then sold on a first -come, first -serve basis to private parties building market rate single family homes. In April 2010, Governor Pawlenty signed legislation giving the City of Fridley, along with seven other cities, the ability to create multi- phased scattered site housing replacement Tax Increment Districts. In Fridley's case, the new legislation simply reauthorized the HRA to reestablish it's Housing Replacement Program. Both the previous and new legislation allow the Housing Replacement Program properties to be included in scattered site tax. increment - financing districts. Once a parcel is included in the district, the HRA collects tax increment for a period of 15 years. The increment is used to help cover the costs of the program (acquisition and demolition), requires a 25% match from non -TIF sources. The rules for the HRP scattered site TIF Districts is less cumbersome to administer than traditional tax increment districts. Since the program originally began in 1995, the City has approved four phases (1995, 1997, 2001, 2004) and purchased a total of 21 sites. During the initial round of the Housing Replacement Program (1995 -2004) the Authority was very successful in encouraging reinvestment in parts of Hyde Park and Riverview Heights neighborhoods through acquisitions and construction of new homes. The extremely low home prices and high number of foreclosures make this an opportune time for the HRA to begin acquiring parcels for future phases of the Housing Replacement Program. One dilapidated home can affect an entire neighborhood, just as one new home can inspire a neighborhood. The return on the Authority's investment is the value of the new housing in the n community and the positive impacts on the neighborhoods. Property Acquisitions Staff has worked diligently to determine the best approach to implement and run this program under the current market conditions. Because there is currently so much competition from investors for foreclosed properties, Staff is recommending a partnership with the non -profit Twin Cities Community Land Bank (TCCLB). The partnership would provide an opportunity to purchase foreclosures directly from the lenders before they hit the open market through their "First Look" program. The "First Look" program requires some quick turnaround times for the HRA to make decisions on whether or not to move forward with a purchase. This program requires that staff be given some general authority to make purchase offers on properties eligible for the HRP, within the timelines required by the TCCLB. How does the TCCLB's "First Look" Program work? The TCCLB receives notice from lenders once the properties are cleared. through their redemption period, prior to being listed on the Multiple Listing Service. On a daily basis, the TCCLB will send a list of new Fridley properties (example below)for our consideration. NEW PROPERTIES FOR CONSIDERATION NCST ID PROGRAM ADDRESS CITY STATE ZIP SERVICER CONTACT CONTACT NAME. PHONE YES/NO -PASS 77 RICE RICK 763 - 746 - CREEK Bank of BANDEVMU 4944 REASON MPLA0908 FIRST LOOK WAY NE FRIDL EY MN 55432 America If the property is of interest to the HRA, a response is required within 1 business day. The HRA then has 5 days to view the property and determine if it may be of interest and request pricing from the lender. The lender will provide the fair market value and the discounted price for the HRA's consideration. It may take 1 -3 weeks to receive the pricing from the lender due to the sheer volumes of properties they are attempting to dispose. Once the pricing is received the HRA must accept the price or decline the purchase within 1 business day. If the HRA determines that it should move forward with purchasing the property, the TCCLB will prepare and send the purchase agreement and order a commitment for title insurance. The HRA must also submit $1,000 earnest money within 5 days of receiving the purchase agreement. The property closing will typically take place within the next 2 weeks. On average, it is typically only 1 month from initial notification to property closing. Staff will also use more typical means to find properties, namely the Multiple Listing Service and the City's Code Enforcement and Building Personnel. It may be possible to find homes that are in too poor of shape for the private market to rehabilitate on the MLS. Additionally, the City's field staff have a good handle on "problem" properties (vacant, dilapidated, etc.) and will continue to be a good source for potential properties. Are there other reasons to participate in the "First Look" program? The biggest benefit to participating in the program is not necessarily the Authority's ability to view homes before they are listed on the MLS, but to leverage significant investment from the private sector and promote owner occupancy of these properties. By participating in the program, the properties that the Authority does not/cannot purchase are then made available to a small list of approved developers selected by the TCCLB. This small group of developers may then purchase and rehab the home. Unlike the investors that are currently purchasing every fixable foreclosure the minute they hit the MLS and turning them into rental properties, the properties purchased by the approved group of developers all come with deed restrictions that require owner occupancy. The approved developers must sell the homes to an owner - occupant and deed restrictions require that the home remain owner occupied for a minimum of 5 years. How will staff choose properties to purchase? Using HRA resources, staff intends initially to only purchase those properties that will most likely require demolition. Staff will work to purchase those properties that the private market most likely will not rehabilitate, that are dilapidated problem properties, or are strategically located in areas that are advantageous to future City or HRA projects. The idea is to get rid of the bad house on the block and inspire the rest of the neighborhood to reinvest in their properties. In all cases the properties to be purchased will meet the requirements of the enabling legislation. Namely the properties to be acquired for the HRP must be 1) a vacant parcel, 2) parcel containing a vacant house, or 3) a parcel containing structurally substandard houses. In order to take advantage of the "First Look" program, staff recommends that the Authority authorize staff to identify up to 3 properties (as a trial) qualifying for inclusion in the HRP and move forward with purchase agreements signed by the Chair or Vice -chair on behalf of the Authority. Disposition of Property: At this point in time, Staff sees no reason to change from the format previously used by the HRA to get the properties back on to the tax rolls. Staff will continue to monitor the overall housing market and recommend changes to the process if needed. A draft of the buyer's guide is attached to this memorandum. Staff Recommendation: Staff recommends the Authority approve the following three separate motions. 1)That the Authority approve a motion to continue the Housing Replacement Program. 2) That the Authority approve a motion to participate in the Twin Cities Community Land Bank's "First Look" program. 3) That the Authority authorize staff , with the approval of the Board Chair or Vice -chair & Executive Director, to purchase up to 3 homes for inclusion in the HRP. Fridley Housing Replacement Program Information Guide A Guide to Purchasing Vacant Lots through the Fridley HRH's Housing Replacement Program MAY 2010 - DRAFT Fridley Housing and Redevelopment Authority 6431 University Avenue N.E. Fridley, Minnesota 55432 May 2010 Equal Housing Opportunity Agency �1 ,..� Introduction The Fridley Housing and Redevelopment Authority (HRA) created the Housing Replacement Program in 1995 for the purpose of removing older, substandard housing and replacing it with new housing. The goals of the program are to: 1. Help eliminate blight. 2. Preserve and expand the City's tax base. 3. Encourage neighborhood revitalization through re- investment. All of the properties which are acquired by the HRA, are purchased on a voluntary basis directly from the owner or through a bank owned foreclosure. Once acquired, the structures are demolished and the lots are then sold on a first -come, first -serve basis. This guidebook describes what is required to purchase a lot and build a new home. Construction Standards The Housing Replacement Program is a new construction program only. New homes must be built by either 1) conventional, stick - built, on -site construction or 2) on -site panelized construction with pre - approval of the Fridley HRA staff. Unacceptable construction includes, but is not limited to manufactured housing (e.g. mobile homes), modular housing, or existing homes that are moved on site from another location. Home Design Guidelines One of the objectives of the Housing Replacement Program is to encourage home designs which are sensitive to existing neighborhoods. As an older community, the predominant home styles in Fridley include ramblers and Cape Cods; both of which are distinctive from most new homes built today. To assist both buyers and builders in understanding these design requirements, a special guidebook has been prepared entitled "Fridley Housing Replacement Program: A Patternbook for New Homes ". A copy of this book is attached and parties are encouraged to follow the guidelines carefully as they prepare their home plans. Owner Occupancy Requirement All homes built under the Housing Replacement Program must be owner- occupied. Builder Requirements Only licensed home builders are allowed to purchase an HRA lot and construct a new home. However, to make the program workable, individuals may reserve a lot for a r^� period of time and then find a builder or conversely builders may reserve a lot and then find a buyer. Additional information on this process is described in the next section. How to Reserve a Lot There are two options for reserving an HRA lot: Option 1 A home builder may reserve a site and then find a buyer. Option 2 An individual may reserve a site and then find a builder. To reserve a lot, you need to fill out a Lot Reservation Agreement (attached) and pay a reservation fee of $500.00. Checks should be made payable to the Fridley HRA. The fee is earnest money for the lot and will be credited toward to the purchase price. This fee is non - transferable to other HRA lots and can only be refunded in the event that you cannot qualify for financing. It usually takes one to two weeks to process your agreement. Once you receive the agreement back, you will have 60 days to submit the following information: 1. A signed purchase agreement between the builder and the buyer for the new home to be constructed. This agreement can be subject to contingencies, such as eligibility for financing and HRA approval. 2. A full set of house plans (prepared in accordance with the HRA's design guidelines). 3. Evidence that the builder has construction financing for the new home and the home buyer has qualified for permanent financing. Once these items are in place, the HRA board will meet to review the project and authorize the sale of the land to the builder. In addition, the HRA will approve a Contract for Private Redevelopment with the builder. This document spells out the obligations of each party and the details of the project. Overview of Development Process Step Activity Anticipated Time Frame n 6 Step 1: Lot Reservation Step 2: Builder /Buyer works on preparing plans, Up to 60 days arranging financing and executing a purchase agreement. Must be submitted to HRA within this time frame. Step 3: HRA staff review of plans and related Up to 30 days project documents. Step 4: HRA meeting to review and approve the Up to 30 days project. Builder can submit application and plans to City for building permit. Step 5: Developer and HRA execute development No later than 30 contract. days after HRA approval. Step 6: Closing. HRA sells lot to builder and No later than 60 conveys title. days after HRA approval. Step 7: Construction Maximum of 120 days, weather permitting. Available Lots See the Appendix for more information and a price list. Questions For more information, contact the Housing Coordinator at 763- 572 -3591. f ACTION ITEM HRA MEETING OF JUNE 31201-0 QTY OF FRIDLEY Date: May 26, 2010 To: William Bums, City Manager From: Paul Bolin, Asst. Executive HRA Director Subject: Sikh Society Provertv Purchase Last month the Authority authorized staff to submit a purchase offer to the Sikh Society for their property located at 5831 University Avenue. The amount offered was a total of $434,000 ($414,000 for the property and $20,000 for relocation). This amount was an 8% decrease under the $470,000 offer previously made to the Sikh Society in 2007, and was based on comparable decreases in property values on similar properties. Staff met with Sikh Society Representatives a few times over the past few weeks. The Sikh Society made a counter offer, requesting a total of $450,000 and the ability to lease the property for 6 months while the prepare and move to their new worship space. Staff believes that $450,000 is too much to pay for this property and countered back with a total of $444,000 and the ability to lease the property for 6 months, pending approval from the Authority. The President of the Sikh Society has verbally agreed to the $444,000, pending Authority approval. Staff anticipates receiving the signed purchase agreement prior to your meeting next Thursday. Staff Recommendation: Staff recommends the Authority approve the purchase of the property for a total of $444,000 ($424,000 for the property and $20,000 relocation). Further staff recommends that the Authority lease the property back to the Sikh Society for no more than 6 months at a rate of $1 /month. INFORMATIONAL ITEM HRA MEETING OF JUNE 312010 My OF FRIDLEY Date: May 27, 2010 To: William Burns, City Manager From: Paul Bolin, Asst. Executive HRA Director Subiect: Home Remodelina Proaram Update The remodeling project has continues to move forward without any glitches. The Lennox Builders and Tim Van Auken continue to be excellent to work with. Because of the nice weather, we remain ahead of schedule and will have no problem completing the work prior to the July open house dates. Open House Update The 1/2 way to completion open houses will be held on Sunday, May 23, from 11 a.m. to 4 p.m., and Wednesday, May 26, from 4:30 p.m. to 6:30 p.m. We had approximately 300 people n through the home on Sunday and more than 60 attendees on Wednesday evening. People continue to be excited about the project and we received many positive comments from those attending the event. The bulk of the attendees were Fridley residents and a large number of them had attended the pre - remodel open house. Remodel Update Framing in of the addition and interior walls is now complete. Insulation and sheetrock installation will start next week, after the plumber and electrician have finished their work. W INFORMATIONAL ITEM Ir HRA MEETING OF JUNE 30 2010 Cr1Y OF FRIDLEY uate: may 1ti, 1ui u To: William Bums, City Manager From: Paul Bolin, Asst. Executive HRA Director Subject: Update on Land Sale to Fridlev Assisted Livina. LLC Mr. Faulkner continues to move forward with plans to develop a 40 unit assisted living / memory care building for seniors on the Old Central property and a 19 unit memory care facility on the E. Moore Lake Drive site. Fridley Assisted Living, LLC (Faulkner's development group) have now had a chance to review and approve the development/purchase agreement prepared by Attorney Casserly. We anticipate a closing to happen within the next few weeks. The City Council approved the Code required "master plan" at their May 10th meeting. Additionally Mr. Faulkner is close to obtaining necessary permits from the Rice Creek �--� Watershed District. Staff will provide a brief update next Thursday evening. ,.. Fridley HRA Housing Program Summary Cover Page June 3, 2010 HRA Meeting W Report Loan Application Summary Loan Origination Report Remodeling Advisor Description Loan application activity (e.g. mailed out, in process, closed loans) for May and year -to -date. Loan originations for May and year -to- date. Shows the number of field appointments scheduled and completed for the Remodeling Advisor Services administered by Center for Energy and Environment. -�-� eA "- V- S +--a �-F �. � -� � e C e ,vim O S �A C'- Ce 00f- +IS �-o V- 6466 - VI Lee L H:4- Paul's DocumentsUHRMHRA Agenda Items\2010Uune 3, 2010\Housing Program CoverJune.doc Vokr FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY June 3, 2010 w Sam 1. Northstar The special trains being run for Twins games have exceeded all expectations and have been standing room only. It is hoped that those using the train for these games will continue to ride it regularly for commuting as well. Just this week, Metro Transit informed us that they will now be running 8 cars for all Twins games that they service. This is up from the 4 cars they started the season with. This also means that the trains will have to "double stop" at each platform as there is only room on each platform for 4 -5 cars. Adam Harrington, of MetroTransit, is working to coordinate a meeting with City Staff and Medtronic reps to go over the results of the special counts they did of our station in April and to further discuss the potential of a shuttle for those working in Fridley. Adam did also provide some updated numbers for April, simply based on fares purchased. The numbers, attached, are very encouraging as ridership has increased over March numbers at every stop. In Fridley, the number of average daily trips double from 50 to 101! 2. The Waters of Fridley Trident Development, St Cloud, has applied for a "master plan" approval to construct a 72 unit senior building on the former Sandee's site located at 6490 Central Avenue. The 72 units will include 14 memory care units, 51 assisted living units, and 8 independent care units. Project information is attached. The master plan will go to the City Council for approval on June 28th. Housing studies done by Maxfield Research identify plenty of demand for this type of housing. This project will not, according to Jim Faulkner, alter his plans to the south of this project as there is a pent up demand for this type of housing that Fridley is currently lacking. 3. Cub Foods Redevelopment We should see work starting to happen fairly soon on this site. The City has been actively working on its lease for its new space and McDonalds has agreed to take one of the outlots along 57th Avenue. Hope everyone has a safe and enjoyable Memorial Day Weekend! We'll see you at 6PM on Thursday. E ' 1 / 1 O MON rLO ,t N N N r N N N N N a m trnn O rCN— TT�ONNnWrn(OCDrnCDNnMI — —T — NT _ cc D C N Cl) cn cn A i-5 CD Cn LO C) fDONM co r Or �rrO�rn Q:ANr -NIti r /m wY/ W M CD CDrn Orn nnM■� n N M N 0 N O M N I M N N r N N M N N L cc s i ov coNrnrncDrno MNM =Mmglq 0 W COCOM NCD to ntD� O ZC O 2 T 0 mom oNmcomrnncotonrnlN = nrnu�ncDco n v Cl) 1n V CO O m LO t0 N L6 0 ° N M L -'tnOqtrnOMrnn LaCrr) Q. a s 9LnrncoinoornnCO mO�r�ONcl O CDE nNN 'Wn LO LO Nra vCO; ,rna, O L gO�I'CDNrnrnOrnOco O ED Cl wnmr NN CD r mW t, oC � 06 C C6 CV CD Ui n ml � N a m O Q J O> Y CO0 m ll CO Q Y m �IJcc CCC a O OWm rn O m W Q 0 LL y O Co W rn Q' G• O O N ui N T CQ 2 .y f3 F- O m 2 THE WATERS OF FRIDLEY ,..� 6490 CENTRAL AVE NE FRIDLEY, MN Building Description 72 unit, three story `elevator, building, 8 tuck -under parking stalls, 49 surface parking spaces, single phase development, porch, various offices for staff, laundry, facilities, wood framed construction, fire sprinkled, resident call center. Gross Building Area.: approx.74,569 square feet unit Mix 14 studio memory care units 44 one bedroom assisted living units 6 one bedroom independent care units 7 two bedroom assisted living units 2 two bedroom independent care units Site Area 174,000 sq. ft. approximately 3.9 acres +/- Legal Description 6490 Central Ave NE/Lots 1, 2 & 3 Auditors Subdivision #88, Fridley, Anoka County, Minnesota Density/Lot Coverage 18 units per acre /2,417 sq. ft. per unit net Amenities; Community Room and Fitness Facility Walking distance to proposed public library One block away from Allina Clinic Security lighting and controlled building access Storage spaces available for residents Site staffed 24 hours a day Coffee Shop Private dining room Salon Commercial grade spa available Laundry facilities in congregate and assisted living units Independently controlled thermostats in each unit Library/Media center Facility owned van for transportation Social programming 'Developed by Trident Development, LLC and Tealwood Management General Contractor Lyon Contracting and Development, Inc Operations Management Tealwood Management, LLC r"� r -A Log x Asa_ �: i � rtrli tear f t 1 I � t � FM= z fpr t j al t aJt My, y1 i i' I ' 3 yr1 r I 1 1 t 1 P _— [ p t � t E9 1' r I 1 a IT I � --'----'------ EP .i I CENTRAL AVE. 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D ' 20 Do Twin Cities Community Land Bank The Twin Cities Community Land Bank is a nonprofit Building Neighborhoods Strengthening Communities organization that was formed by the Family Housing Fund as a strategic tool for government, neighborhood based organizations, community development corporations, and nonprofit and for profit developers to further community -based economic development and affordable housing goals. The Fund and its public /private partners have designed and implemented this highly innovative tool to respond quickly and effectively to the challenges and opportunities of the foreclosure crisis and to further regional growth objectives linking housing, jobs, transportation, and education. Building Neighborhoods, Strengthening Communities The Twin Cities Community Land Bank is designed to operate on a large scale and over a broad geographic area, including the cities of Minneapolis and Saint Paul and the surrounding cities and counties in the seven - county metropolitan area. The Land Bank will coordinate across multiple sectors of interest and takes both an immediate and long -term view toward the development and re- building of communities. The Land Bank will coordinate housing policies and programs with broader community development objectives, including jobs, economic opportunities, transportation, public safety, schools, human services, green building and design, and homeownership counseling and support. As a nonprofit limited liability company, it is designed to be highly flexible and responsive and is able to leverage additional public and private dollars to accomplish the goals of neighborhood stabilization and recovery. $30 million Committed to Support Neighborhood Revitalization Efforts The Twin Cities Community Land Bank has raised and committed $30 million to advance neighborhood recovery in the Twin Cities metropolitan area. While this funding has been allocated across the metro- politan area, it has been concentrated in specific neighborhoods to spur transformative change through a concentration of resources and support. Twin Cities Community Land Bank's funds will be used for property acquisition, rehabilitation /redevelopment, and holding costs for properties that are banked for varying terms based on market absorption. Creating Sustainable Homeownership and Rental Opportunities Maximizing Neighborhood Stabilization Program Investments in the Community As a part of the national Neighborhood Stabilization Program (NSP), Twin Cities Community Land Bank intends to purchase for its public and private partners, 2000 residential properties and parcels in targeted communities, with the goal of rehab or redevelopment of the properties. and creating sustainable home- ownership or rental opportunities for individuals and families. Twin Cities Community Land Bank will be an interim acquisition lender for its public and private partners that are NSPI grantees /sub grantees and NSP2 applicants— advancing funds to allow its partners to respond quickly and strategically to acquisition and redevelopment opportunities. The Land Bank will also act as a lender to developers undertaking rehabili- tation and new construction. Finally, Twin Cities Community Land Bank will provide additional community services to address barriers to community revitalization, such as developing creative homeownership financial products and coordinated neighborhood marketing. Enhancing the National Community Stabilization Trust's First Look and Aged /Targeted Bulk Purchase Programs The National Community Stabilization Trust's (NCST) groundbreaking REO acquisition program, also known as First Look and Aged /Targeted Bulk Purchase, was launched in the Twin Cities metropolitan area — attesting to the Twin Cities' highly regarded, coordinated, and effective community approach to the foreclosure crisis. The NCST First Look program provides an efficient and cost effective mechanism for transferring vacant and foreclosed properties directly from banks and servicers to approved buyers at an adjusted and highly favorable price before properties go on the open market. The Aged /Targeted Bulk Purchase program provides an opportunity to purchase clustered properties, thus magnifying the opportunity to significantly improve a neighborhood. Two nonprofit organizations (Greater Metropolitan Housing Corporation and Dayton's Bluff Neighborhood Housing Services) have been managing this program in the Twin Cities on a pilot basis. As of September 1, 2009, the Twin Cities Community Land Bank assumed the role of manager of the NCST program in Minneapolis and Hennepin County. After allocation of NSP2 awards, Twin Cities Community Land Bank will expand its management of the NCST program metro -wide. Twin Cities Community Land Bank Guiding Principles The Twin Cities Community Land Bank works with its public, private, nonprofit, and community partners with the ultimate goal of supporting the creation of vibrant, sustainable homes, neighborhoods, and communities throughout the Twin Cities metropolitan area. In order to achieve this goal, the Twin Cities Community Land Bank is guided by the following eight main principles. 1. Enable the efficient and effective acquisition, holding, and marketing of properties acquired through various neighborhood recovery efforts. 2. Reduce the public cost of holding land through efficiencies of coordination and scale. 3. Efficiently and creatively aggregate capital to support a large scale land acquisition, disposition, and marketing effort. 4. Provide opportunities for community and neighborhood engagement in the development of foreclosed properties, particularly among communities of color. S. Promote best practices in planning and design, including high architectural standards, energy efficiency, green land and construction standards, and housing development to transportation linkages. 6. Coordinate housing policies and programs with broader community development objectives, including jobs, economic opportunities, transportation, public safety, schools, human services, and homeowner- ship counseling and support— particularly among communities of color. 7. Provide affordable, sustainable homeownership opportunities for low and moderate - income families while reducing the disparity between homeownership rates for whites and communities of color. B. Provide business and contracting opportunities for communities of color. Contact Rebecca L. Rom PH 612- 238 -8210 Twin Cities Community Land Bank FAx 612 - 238 -8219 615 First Avenue NE, Suite 410 WEB www.tcciandbank.org Minneapolis, Minnesota 55413 E becky.rom @tcclandbank.org October 2009 T,, - ,! -, r r -,1 d F ­ i. PLC _ J , �t rr _ F,ifl -! N S JSIna F_i'�d 6/3/2010 FIRST LOOK PARTNERS ACTIVE: Hennepin County (50 Cities) County Program (41) EC, Engstrom, GKP, GMHC, MHS, REE, SH, TC (8 total) Minneapolis AH, CLCLT, CPED, EC, EH, Engstrom, GM, GMHC, Legacy, MHD, MHS, NHS, PPL, PRG, SH, TC, TCH, UHW (18 total) Brooklyn Park City, EC, Engstrom, GM, GMHC, MHS, PRG, Rains, SH, TC, TCH (11 total) Brooklyn Center City, EC, Engstrom, GC &I, GMHC, MHS, SH, TC (8 total) Champlin City, EC, Engstrom, MHS, TCH (5 total) Crystal City, EC, Engstrom, GMHC, MHS, PPL, SH, TC (8 total) Mound TCH (1 total) New Hope EC, Engstrom, GC &I, GMHC, MHD, MHS, SH, TC, TCH (9 total) Richfield City, EC, Engstrom, GM, GKP, GMHC, MHD, MHS, PPL, SH (10 total) Robbinsdale EC, Engstrom, GM, GKP, GMHC, MHS, REE, SH, TC (9 total) Anoka County (4 Cities) Anoka City, EC, Engstrom, GMHC, MHS (5 total) Columbia Heights City, EC, Engstrom, GMHC, MHS, SH (6 total) Coon Rapids City, EC, Engstrom, Legacy, MHS, SH (6 total) Fridley City, EC, Engstrom, GKP, GMHC, MHS, REE, SH (8 total) Carver County (15 Cities) EC, Engstrom, GKP, MHS, REE, SH (6 total) Ramsey County (16 Cities) County Program (12) Crockett Builders, EC, Engstrom, MHS, Parvanue, SH (6 total) Falcon Heights EC, Engstrom, GKP, GMHC, Legacy, MHS, REE, SH (8 total) Mounds View EC, Engstrom, GMHC, MHS, SH (5 total) Roseville City, EC, Engstrom, GMHC (4 total) Shoreview City, EC, Engstrom, GMHC, Legacy, MHS, SH (7 total) Scott County (9 Cities) EC, Engstrom, GKP, GMHC, MHS, REE (6 total) Washington County (1 City) Woodbury City, Dayton's Bluff, EC, Engstrom, GC &I, GKP, Legacy, MHS, PRG, REE, SH (11 total) See Abbreviations on next page PENDING: Counties: Anoka (14), Dakota (19), and Washington (27) Cities: Maplewood and Minnetonka ,/-11 /"1 . DEVELOPERS 6/3/2010 ABBR Entity Name AH Alliance Housing Incorporated NP Anoka City of Anoka City BC City of Brooklyn Center City BP City of Brooklyn Park City Champlin City of Champlin City Columbia Heights City of Columbia Heights City CR City of Coon Rapids City Crystal City of Crystal City Fridley City of Fridley City CLCLT City of Lakes Community Land Trust NP CPED City of Minneapolis Community Planning and Economic Development NP New Hope City of New Hope City Richfield City of Richfield City Robbinsdale City of Robbinsdale City Roseville City of Roseville City Shoreview City of Shoreview City Woodbury City of Woodbury City Crockett Crockett & Crockett Builders, Inc. FP DB Dayton's Bluff Neighborhood Housing Services NP EC Everwood Company, LLC FP EH EthnicHome LLC (also called NH Housing) FP Engstrom Robert Engstrom Capital Management, LLC FP GC &I Global Construction & Investment, Co., Inc. FP GMHC Greater Metropolitan Housing Corporation NP GKP Greenkey Partners LLC FP Legacy Legacy Management & Development Corporation FP MHD Minneapolis Home Development LLC FP MHS MyHomeSource NP NHS Neighborhood Housing Services of Minneapolis NP Parvenue Parvenue Properties, LLC FP PPL Project for Pride in Living NP PRG Entity is called PRG, Inc. NP Rains Rains Properties, LLC REE Real Estate Equities Opportunity Ventures FP SH Minneapolis Community Trust LLC (Sarah Huss) FP TC Thor Construction /Stairstep Foundation FP TCH Twin Cities Habitat for Humanity NP UHW Urban Homeworks NP ® Elol Qp�- E= Ell 0 Twin Cities Community Land Bank I Building Neighborhoods Strengthening Communities The Twin Cities Community Land Bank is a nonprofit organization that was formed by the Family Housing Fund as a strategic tool for government, neighborhood based organizations, community development corporations, and nonprofit and for profit developers to further community -based economic development and affordable housing goals. The Fund and its public /private partners have designed and implemented this highly innovative tool to respond quickly and effectively to the challenges and opportunities of the foreclosure crisis and to further regional growth objectives linking housing, jobs, transportation, and education. Building Neighborhoods, Strengthening Communities The Twin Cities Community Land Bank JCC Land Bank) operates on a large scale and over a broad geographic area, including the cities of Minneapolis and Saint Paul, and the surrounding cities and counties in the seven- county metropolitan area. The Land Bank coordinates across multiple sectors of interest and takes both an immediate and long -range view toward the development and re- building of communities. As a nonprofit limited liability company, it is designed to be highly flexible and responsible and to leverage additional public and private,dollars to accomplish the goals of neighborhood stabilization and recovery. The Land Bank has raised and committed over $30 million to advance neighborhood recovery throughout the Twin Cities metropolitan area. Early efforts have been concentrated in specific neighborhoods to spur transformative change through a concentration of resources and support. TCC Land Bank's funds will be used primarily for property acquisition and rehabilitation /redevelopment. New Partnership Opportunity —REO Property Acquisition Program TCC Land Bank established a partnership with the National Community Stabilization Trust (NCST) in a national initiative designed to facilitate the transfer of foreclosed and abandoned properties from financial institutions to local governments and their nonprofit and private partners. The purpose of the REO Property Acquisition Program is to achieve sustainable rehabilitation and resale or rental of foreclosed homes, and to encourage housing market activity and neighborhood stability. The program provides access to properties that can be obtained by approved developer partners or local governments at a discount in order to transfer the properties to responsible homebuyers or rental property owners. First Look and Aged /Targeted Bulk Sale Programs The REO Property Acquisition Program consists of two programs: First Look and Aged /Targeted Bulk Sale. The First Look program allows the purchase of vacant and foreclosed homes before they are publicly listed through traditional REO procedures. Prices are calculated on a discount formula based on cost savings experienced by the lender avoiding certain holding and transaction costs. The price also takes into account the need for below market pricing to enable purchasers to comfortably undertake rehab projects. The Aged /Targeted Bulk Sale program allows the purchase of currently listed foreclosed homes at an additional discount. r_ Partnering with the TCC Land Bank and the REO Property Acquisition Program NCST requires a single point of contact and a single acquisition entity in order to maintain an efficient process for the lenders. As such, TCC Land Bank acts as the local intermediary for the Twin Cities metro- politan area and in this capacity has designed and implemented an efficient and streamlined internet- based system that provides direct access to properties by communities and their approved developers. This robust system is coordinated with funding sources and community rehab standards and drives NSP compliance. To join this program and gain access to properties that are available for sale at a discount within their jurisdictions, cities and counties should contact TCC Land Bank and provide a list of applicable zip codes of target areas. Cities and counties define what areas they would like to be eligible for this program. The program is designed for "distressed neighborhoods" or "distressed properties." The city or county could choose to only make available those areas that are within target areas or the city or county could deter- mine that any foreclosure in the city /county could be considered distressed (although luxury properties are to be excluded). If NSP funding is involved, the city /county will need an Intermediary Agreement with the Land Bank to maintain the foreclosure status of the properties. The city /county approves developers who will have direct access to the program. Finally, the city /county defines what, if any, additional criteria it may require of developers working in its community. In conclusion, participation will require the completion of an agreement with the city /county and TCC Land Bank, agreements with approved developers, and the designation of distressed areas within the city's or county's boundaries. There is a transaction fee that is charged for each transfer. Contact Us For more information on the REO Property Acquisition Program, or questions regarding the TCC Land Bank, please contact the main office or one of the Land Bank staff members listed below. TCC Land Bank Staff Rebecca L. Rom, President PH 612- 238 -8213 E becky.rom @tcclandbank.org Shawn Huckleby, Vice President PH 612- 238 -8752 E shawn.huckleby @tcclandbank.org Margo Geffen, Program Manager PH 612- 238 -8214 E margo.geffen @tcclandbank.org Mikeya Griffin, Paralegal PH 612 - 238 -8755 E mikeya.griffin @tcclandbank.org Updated February 2010 Main Office Twin Cities Community Land Bank LLC 615 First Avenue NE, Suite 410 Minneapolis, MN 55413 PH 612- 238 -8210 E info @tcclandbank.org WEB www.tcclandbank.org /°"� T,r,,:n Cities Ccmr:,: ni':. Laiitl E;a'I. LLC is o sub'_idi iy of thr- Faniav I oijsing Furid Twin Cities I Community Land Bank Building Neighborhoods Strengthening Communities TCCLB Community Standards • Owner Occupancy —TCCLB requires that every single family property be sold to an owner occupant. Each owner occupant is required to place a 5 year owner occupancy Covenant on the property. • Hiring- Developer must demonstrate how it will assist people who represent the communities most heavily impacted by the foreclosure crisis, including communities of color (through employment or contracting or otherwise). • MN Green Communities- Each developer is required to complete rehabilitation in accordance with MN Green Community Rehab Standards. • Rehabilitation standards- All rehabilitation must be completed in compliance with HUD Housing Quality Standards and local building code requirements. • Homebuyer Education- Properties resold to first time homebuyers must complete a homebuyer education class. • Developer Certification- Developer must certify to completing the properties in accordance with all of the program requirements above. Developer must certify that the property meets all FHA financing standards, the roof and furnace have an estimated useful life of at least five (5) years, lead paint for homes built before 1978 was remediated in compliance with guidelines and procedures provided by HUD and any asbestos discovered was disclosed and properly remediated . • Developer Reporting- Developers are required to complete a homebuyer demographic form at resale. Developers are also required to report on progress of properties in their inventory. Additionally, each Municipality has the ability to layer on any additional standards they may want for their community.