HRA 04/27/1983 HOUSING & REDEVELOPMENT AUTHORITY
MEETING
WEDNESDAY, APRIL 27, 1983 7:30 P.M.
City of Fridley
AGENDA
HOUSING & REDEVELOPMENT AUTHORITY MEETING WEDNESDAY, APRIL 27, 1983 7:30 P.M.
Location: Council Chamber (upper level)
CALL TO ORDER:
ROLL CALL:
PPROVE HOUSING & REDEVELOPMENT AUTHORITY MINUTES: MARCH 10, 1983
These are in agenda of cancelled meeting of April 14, 19831
CENTER CITY DISTRICT
-.. .. A. Hardware Building Update
—.<: 141 . MEMO (Executive Director)
'AN2. Lease Process
3. Status on existing lease property
Property Acquisition Update
1 . Dr. Ryan Automotive
Resolution : HRA 6-1983
'ISSSi2. Community Credit
Resolution : HRA 7-1983
\j3. Awarding Bids on Sale & Removal of 332 64th Avenue N.E.
Resolution: HRA 8-1983
GENERAL RESERVE SYSTEM DISCUSSION
C-JeAe RE LAKE DISTRICT
equest for Assistance by Tom Brickner for Property
velopment at 6211 Central Avenue N.E.
(Executive Director MEMO #83-37)
B. Request for "Right of Development for "202" Application
by St. Phillip's Human Services , Inc.
IV. FINANCIAL
A. Financial Report
B. Check Register
V. OTHER BUSINESS:
ADJOURNMENT:
CENTER CITY DISTRICT
1
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FROM EXECUTIVE DIRECTOR MEMO NO. 83_23
DATE April 7, 1983 TO ACTION INFO.
SUBJECT Housing & Redevelopment Authority
Hardware Building - 214 Mississippi Street
We removed Clothing Liquidator, Inc. from the Hardware Building on an unlawful detainer
order on April 4, 1983. This gave us back _the control of the building for purpose of
leasing again. This again raises the question on the terms that the HRA wants to
place on the leasing of the building. Placing an 18 month restriction on any new
tenant makes it nearly impossible to lease to any operation other than those with
potential risks.
If the HRA wishes to lease the building, I would suggest that we lease for a guaranteed
three years with 2 one year options. Within the two option years, the HRA would be
able to buy out the depreciated tenant improvements and remove the business at no
additional cost.
It may also be in our best interest to hire a leasing agent for that building so we
can try to pull in a first class tenant rather than relying on the limited contacts
that we generate at the City. I 've talked to Fred Levy, to get a feel of prices
in this area. He indicated that the average price range for 1 ,000 to 1 ,500 square
feet is about $6.00 per square foot triple net. The larger the space, the less per
square foot you would be able to draw. The top dollar on the hardware building
would probably be from $3.50 to $4.00, but with the market in this area, it could
be difficult to get.
The Lions Club has expressed an interest in leasing the hardware building for the
purpose of setting up their club operations. John Gargaro is putting together some
figures on what he feels he could rent the building for. They have been talking
initially about $2.50 per square foot with a 3 year lease with 2 one year options
with depreciated buy outs. The Lions want to discuss that with you at the April 14,
1983 meeting.
JLB/de
•
2
STANDARD LEASE PROCESS - APRIL 14, 1983
The following is the standard lease process to be followed on all new leases
and the maintenance of new and existing leases.
New Leases - 1. All leases shall be executed on standard lease forms
approved by the Attorney for the HRA.
2. There will be a staff review of required financial
documentation (such as, asset/liability report,
bank/financial credit reference checks, financial
statements of existing businesses, etc). This
review shall include the HRA Excutive Director, Lam,.
'Marrdgtr, Fess r .toy and the HRA attorney.
4.m,
3. The signing of the lease must be approved by the HRA
with a report from the Executive Director with written
approval from the HRA attorney.
4. All executed leases shall be accompanied by a first and
last month lease payment.
Maintenance of New and Existing Leases -
1. There shall be a standard late payment process set up
which triggers the sendingof pre-developed form
letters in the following matter.
a. 5 days late - registerei letter requesting
payment with 5% late fee - copy to the
attorney.
b. 10 days late - registered letter notifiying
the tenant and the HRA attorney that unlawful
retainer action is to be started.
2. This is set up for a quick step process, however, some
discretion is allowed to the Executive Director for cases
of unusual circumstances.
3
RE: Payment of rent at
Fridley. MN.
Dear Mr. :
This letter is put you on notice that we have not
received your rent payment. It is essential
that this payment, along with a 5% late fee be received
no later than 5 days from the date of this notice .
Failure to respond to this notice will start automatic
legal action.
payment due
If you have any questions concerning this notice, please
contact the Fridley Housing and Redevelopment Authority
at 571-3450.
Sincerely,
JERROLD L. BOARDMAN
Executive Director
Fridley Housing & Redevelopment Authority
cc: HRA Attorney
JLB/de
3/0/24/8
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RE: Action to Remove From Premises Due to Non-Payment
of Rent
Dear Mr. •
We have been forced to notify our attorney to start
legal action to remove you from the premises at
, Fridley, Mn. , for non payment of
rent. If we have not received payment within 5 days
from the date of this notice, we will be required to
follow through on the legal action started.
Please contact me at 571-3450. _
Sincerely,
JERROLD L. BOARDMAN
Executive Director
Fridley Housing & Redevelopment Authority
JLB/de
3/0/24/9
5
HRA RENT
MONTHLY DATE
LEASEE RENT OCCUPIED 1981 1982 1982
Clothing Liquidators* $3,140 1/83 None
Community Credit $550 8/82 $2,750 $1 ,650
Douthitt $190 + 29.22 9/78 $2,280 $2,280 570
Gary's** $225 7/80 $2,700 $2,400 None
Lifestyle Music $500 5/81 $4,000 $6,000 $1 ,000
Madsen Building $560 11/82 $560 $1 ,120
Magic Swirl $507 8/82 $2,535 507
Northwestern Bell $1 ,020 5/82 $8,160 $3,060
Royal Electric (Standard) $200 3/82 $220 $600
Royal Electric (Land) $20 9/78 $240 $240 $60
*In arrears - $3,420
**In arrears - $975
6
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SROM EXECUTIVE DIRECTOR MEMO NO. 83-24
DATE April 7, 1983 TO ACTION INFO.
iU BJE C T ACQUISITION OF DR. RYANS Housing & Redevelopment Authority
AUTOMOTIVE CLINIC
Please see attached copies of letters written concerning the acquisition of
the above noted property. We have been requested to take condemnation action by
Mr. Ryan's attorney. This process has been started. It is our hope to still be
able to reach some workable purchase arrangement on the property within the
restrictions of the Community Development Block Grant Funds. I should have ad-
ditional information at the April 14, 1983 meeting.
JLB/jh
7
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FROM EXECUTIVE DIRECTOR MEMO NO. 82-54A
DATE Juno 7g. 19117 TO ACTION INFO.
SUBJECT
Tom Ryan File
Acquisition of Dr. Ryan's Automotive
Clinic
Discussed acquisition with Tom Ryan, have agreed to hold off acquisition appraisal
until after the 1st of the year since property not needed to be removed until June,
1983
JLB/de
8
LAW OFFICES
SMITH, JUSTER, FEIKEMA, MALMON 8c HASKV ITZ
WYMAN SMITH CHARTERED
LEONARD T.JUSTER SUITE 1250
HENRY M. FEIKEMA •UILDERS EXCHANGE SUILDING
ALVIN S. MALMON MINNEAPOLIS,MINNESOTA 55402
RONALD 4HA5KV1T2 TELEPHONE 336.1461
C6i2;
CARL J. NEWOUIST
FriCE
MARK E.HAGGERTY FIVERSI OAVEN
JOHN M,WOLIN
5441 UNIYERSITr AVENUE.N.E.
J.CHRISTOPHER CUNEO FRIDLEv,MINNESOTA 55432
TELEPHONE (012) 571.6670
ASSOCIATES
6.WILLIAM EKSTRUM
STACEY A.DEKAL•
JAMES W. HOESCHLER
March 21, 1983
Mr. Jerry Boardman
City of Fridley Planner
City of Fridley
6431 University Avenue N. E.
Fridley, Minnesota 55432
Re: Ryan Automotive Condemnation
Dear Mr. Boardman:
As you are aware, our law firm represents Mr. Thomas Ryan in regard to the
condemnation of his property located at the corner of University Avenue and
64th in the City of Fridley. Recently the City and the HRA made a proposal
to purchase Mr. Ryan's building and land for the sum of $113,000.00 plus an
additional $19,746.00 for fixtures and an additional $4,371.00 for his
interest in his former tenants' property. This letter is to inform you that
Mr. Ryan does not accept your offer in the dollar amounts as stated. I feel
that the only way to resolve the matter will be to commence condemnation and
to argue the issue of damages before the commissioners and possibly the court
itself.
In order to assist the City, my client is willing to accept a "quick take"
which would mean that he would be paid the full amounts as described herein-
before plus relocation costs and reserve all rights that he has to contest
the value of the land, building, fixtures, and relocation damages. I have
ordered that the abstract be brought up to date in order that the city attorney
may review it and that a deed be given to the City for the property in exchange
for the monies stated herein reserving all rights that my client has to contest
the value as the City and the HRA have stated it. I should also inform you
that we have hired the appraisal firm of Newcombe and Hanson to do an independent
appraisal to determine what the real value of the pro—rty is.
Very Y";00111.
Henry H. Feikema
HHF/cv
cc: Thomas Ryan
9
RESOLUTION NO. HRA 6-1983
A RESOLUTION OF THE HOUSING AND REDEVELOPMENT AUTHORITY
OF THE CITY OF FRIDLEY DIRECTING CONDEMNATION AND
DETERMINING THE NECESSITY FOR AND AUTHORIZING THE
ACQUISITION OF CERTAIN PROPERTY BY PROCEEDINGS IN
EMINENT DOMAIN ON LOTS 12, 13 AND 14, BLOCK 4, BEE'S
ADDITION TO FRIDLEY PARK, 6389 UNIVERSITY AVENUE N.B.
WHEREAS, the Fridley Housing and Redevelopment Authority has previously
entered into a contract with Columbia Park Clinic for the acquisition of
the property at 6389 University Avenue N.E. , Fridley, Minnesota; and
WHEREAS, the Commissioners of the Fridley Housing and Redevelopment
Authority believe it is in the publilc interest to acquire the above
property;
NOW, THEREFORE BE IT RESOLVED by the Housing and Redevelopment Authority
of the City of Fridley, Minnesota, as follows:
1. Acquisition by the Fridley Housing and Redevelopment Authority
(herinafter referred to as the Fridley H.R.A. ) on the following
described property is neccesary for the purpose of the orderly
development of the Center City Tax Increment District and in order to
perform its contractual obligations with Columbia Park Clinic;
Lots 12, 13, and 14, Block 4, Ree's Addition to Fridley Park.
2. The Fridley H.R.A. attorney is authorized and directed on behalf
of the Fridley H.R.A. to acquire the real estate described above by
the exercise of the power of eminent domain pursuant to Minnesota
Statutes, Section 117.042. The attorney is further authorized to take
all actions necessary and desirable to carry out the purpose of this
resolution.
PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY
OF FRIDLEY THIS 14TH DAY OF APRIL, 1983.
CHAIRMAN
HOUSING AND REDEVELOPMENT AUTHORITY
ATTEST;
EXECUTIVE DIRECTOR
3/0/24/10
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FROM EXECUTIVE DIRECTOR MEMO NO. 83-26
)ATE April 7, 1983 TO ACTION INFO.
;OBJECT COKMUNITY CREDIT UPDATE Housing & Redevelopment Authority
Please see attached the memo from Dave Newman regarding the Community Credit
condemnation. He has indicated that an appraisal of the lease will be required
for the quick take action and should be completed as soon as possible. This will
also give us a basis for any possible negotiation with community credit. I have
taken the necessary steps to get that appraisal completed. I will keep you in-
formed of any future activity regarding this matter.
JLB/jh
11
MEMORANDUM
To: Jerrold Boardman
From: David P. Newman
Re : Community Credit Company
Date: April 8 , 1983
You asked for clarification of the procedure being followed
in the condemnation of the leasehold interest held by Community
Credit Company . Inasmuch as Community Credit Company appears
to be in possession of the property under a valid lease , the
only action available to the H.R.A. was condemnation, since
an unlawful detainer cannot be commenced against a tenant in
rightful possession.
In commencing the condemnation, we included a notice provision
in which we advised Community Credit that we intended to take
possession of the property on June 16 , 1983 . This was done
pursuant to M.S.A. Sec . 117.042. This statute provides that
if the City has an actual need for the property before the
determination of the award by the commissioners, then the public
body may take possession 90 days after notice is given by either
paying to the owner or depositing with the court , the amount
of the petitioner' s approved appraisal . Consequently , it will
be necessary for the H.R.A. to obtain an appraisal on the subject
property. This appraisal is different than the one performed
by the court appointed commissioners.
Although the appraisal does not need to be done at this time,
it must be completed prior to the expiration of the 90-day
period . In addition, I would ask that it be done soon enough
so that we would have time to apply to the court for an order
transferring possession of the property to us based upon our
appraisal .
It is my understanding that you have also asked our office
to commence condemnation proceedings on the property owned
by Tom Ryan. Again, we will draft the documents so as to provide
for 90-day possession and they will be prepared so that they
can be served as soon as the H.R.A. has adopted a resolution
authorizing the condemnation.
RESOLUTION NO. HRA 7-1983 12
A RESOLUTION OF THE HOUSING AND REDEVELOPMENT AUTHORITY
OF THE CITY OF FRIDLEY DIRECTING CONDEMNATION AND
DETERMINING THE NECESSITY FOR AND AUTHORIZING THE
ACQUISITION OF CERTAIN PROPERTY BY PROCEEDINGS IN
EMINENT DOMAIN ON THE LEASEHOLD INTEREST HELD BY
COMMUNITY CREDIT COMPANY, 6339 UNIVERSITY AVENUE I.E.
WHEREAS, the Fridley Housing and Redevelopment Authority has previously
entered into a contract with Columbia Park Clinic for the acquisition of
the property at 6339 University Avenue N.E. , Fridley, Minnesota; and
WHEREAS, the Commissioners of the Fridley Housing and Redevelopment
Authority at their meeting of March 10 , 1983, concurred in the
recommendation of its executive director to acquire the leasehold interest
in the above property in order to be able to perform under the terms of the
contract which the Fridley Housing and Redevelopment Authority entered into
with Columbia Park Clinic;
NOW, THEREFORE BE IT RESOLVED by the Housing and Redevelopment Authority of
the City of Fridley, Minnesota, as follows:
1 . Acquisition by the Fridley Housing and Redevelopment Authority
(herinafter referred to as the Fridley H. R. A. ) on the following
described property is necessary for the purpose of the orderly
development of the Center City Tax Increment District and in order to
perform its contractual obligations with Columbia Park Clinic;
The leasehold interest held by Communtiy Credit Co. over a
portion of Lots Four (4) through Eleven (11) , except the easterly
30 feet of Lots Four (4) through Seven (7) inclusive, all in
Block Four (4) Ree's Addition to Fridley Park, County of Anoka,
State of Minnesota.
2. The Fridley H.R.A. attorney is authorized and directed on behalf
of the Fridley H.R.A. to acquire the leasehold interest in the real
estate described above by the exercise of the power of eminent domain
pursuant to Minnesota Statutes, Section 117.042. The attorney is
further authorized to take all actions necessary and desirable to
carry out the purpose of this resolution.
PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY
OF FRIDLEY THIS 14TH DAY OF APRIL, 1983.
CHAIRMAN
HOUSING AND REDEVELOPMENT AUTHORITY
ATTEST;
EXECUTIVE DIRECTOR
3/0/24/11
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FROM EXECUTIVE DIRECTOR MEMO NO. 83-25
DATE April 7, 1983 TO ACTION INFO.
SUBJECT BIDS FOR THE SALE AND REMOVAL OF Housing & Redevelopment Authority
THE SINGLE FAMILY HOME AT 332
64TH AVE. N.E.
Please see the attached bids that were received for the sale and removal of
the above noted single family home. The high bid was Safeway Movers at $5,800.00.
The house is set for removal on May 2, 1983. This bid calls for the removal
of the house structure from the site. All movers will be notified by letter, fol-
lowing HRA awarding of the sale at the April 14, 1983 meeting.
I am also enclosing copies of the bids for the removal of the garage at 336
64th Ave. N.E. The demolition and removal was completed as required under our
contract with Columbia Park Clinic. H & S Asphalt Company was low bid at $3,750.00.
JLB/j h
_.._ __
14
RESOLUTION NO. H' -1983
A RESOLUTION OF THE HOUSING AND REDEVELOPMENT AUTHORITY
OF THE CITY OF FRIDLEY APPROVING THE SALE OF THE
RESIDENTIAL STRUCTURE AT 332 64TH AVENUE N.E. , AID
AWARDING THE BID TO SAFEWAY MOVERS.
WHEREAS, the Fridley, Housing and Redevelopment Authority has purchased the
residential property at 332 64th Avenue N.E. as part of the Center City
Redevelopment District; and
WHEREAS, the land associated with this purchas has been deeded to the
Columbia Park Properties as a condition of the "Contract for Private
Development" between the Fridley Housing and Redevelopment Authority and
the Columbia Park Properties; and
WHEREAS, the Fridley Housing and Redevelopment Authority is responsible for
the removal of the structure from the aboved noted property.
NOW, THEREFORE BE IT RESOLVED by the Housing and Redevelopment Authority of
the City of Fridley, Minnesota:
$(:b That they hereby approve the sale of the single family structure
located on Lots 1 , 2 and 3, and the Northerly 7 1/2 feet of Lot 4,
except the Easterly 54 ft. thereof, Block 4, Ree's Addition to Fridley
Park, generally described as 332 64th Avenue N.E. , Fridley, Minnesota.
V That they hereby award the bid sale to Safeway Movers for
$5,800.00 to move the structure from the above described site.
PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY
OF FRIDLEY THIS 14TH DAY OF APRIL, 1983.
HAIRMAN
OUSING AND REDEVELOPMENT AUTHORIT
ATTEST;
EXECUTIVE DIRECTOR
3/0/24/12
•
15
117-4 stitti CITY OF FRIDLEY
6431 UNIVERSITY AVENUE N.E., FRIDLEY, MINNESOTA 55432
TELEPHONE ( 612)571-3450
April 7, 1983
• r
•
Safeway Movers, Inc.
8955 - 235th Street North
Forest Lake, MN 55025
Dear Sirs:
At the regular H.R.A. meeting on April 14, 1983, you will be awarded
the house located at 332 - 64th Avenue N.E. The price you quoted
the City of Fridley was $5,800. We require a certified check in the
amount specified made out to the Fridley Housing and Redevelopment
Authority. The check must be received prior to any activity on the
property.
As per our agreement, the house must be moved out of the City on or
about May 2, 1983. It is imperative to the surrounding construction
that this project be completed as soon as possible after May 1, 1983.
Thank you for your cooperation and we look forward to working with
you.
Sincerely,
John G. Flora
Director of Public Works
JGF/mc
cc: Jerry Boardman
Mark Burch
Del Zentgraf
1-6
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❑
SEND VIA
SPEEDWRITER MESSAGE SENDER 1TP( OR MRi1( M(SS•GE PULL OUT 'EL(O* SSW REGULAR MAIL
MAIL *.,,TE PhD Plhe COFIES 1C ►DDRISS(E ❑
AIR MAIL
►DDR(SSEE Iva Tl RIPI' R(EP WW1( COPY RE1UPh T..( P1PIR
Poo 4I 0 SPECIAL DELIVERY
FROM: DALE MOVERS. INC. [] Vn,' Tpn u PLEASE REPLY
7B16CENTRAL.AVE..N E. REPLY NOT NEEDED
MINNEAPOLIS. MINN. 65432
P,-. 784-426° March 30, 1983
DATE
SUBJECT
To.
City of Fridley
6431 University Ave NE RE: House on 64 Ave NE
Fridley, MN 55432
Attn: Del
—MESSAGE
I •
Our bid for house and garage to be removed from property.
Removal will proceed on 24 hours notice. $2651.00
POLO
mane TWO THOUSAND SIX HUNDRED FIFTY ONE DOLLARS.
TO Ptt
IPT1I DOS
SDr►LOPS
SIGH MERE /
Dale E. PetervAtli President
—REPLY
1.
(SIGH MERE
J
ADDRESSEE: PLEASE KEEP WHITE COPY AND RE_TI Rs. PINK COPY
1Jrnpnnttl Page No. of Pag�_`-t
/
SAFEWAY HOUSE MOVERS, INC.
8955235th Street North
FOREST LAKE, MINNESOTA 55025
Phone 464-2037
PROPOSAL SUBMITTED TO 7/fY GATE
., 4, 7 . YC4/—AIA)D3? 3— 07Y su
STIIEEr4-4914— JOB NAME
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CITY. STATE AND ZIP CODE JOB LOCATION
ARCHITECT WE Of RAMS JOB PHONE
We hereby submit specifications and estimates for _
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lir FropnBr hereby to furnish material and labor — complete in accordance with above specifications. for the sum of
_ • 1��/ Ci+ -- �.rl...�— dollar s($_:i O '� Y Vikl:c.-.'"IIE-d---- --...".......--Tment be mades � 4
All material is ng Stan tostandard
be as t% Any All Stork to be completed fin a veKunsnlra Authorizedn, v ] y�
manner according to standard pactrces Any aKeratrpn a devytron from above specrfru ees•!(/���
frons rn.dwrng extra costs .,n be executed only upon...teen orders.and cot become an Signature
gem charge over and above the estimate All agreements contingent upon stokes.accidents Notr This proposal may be
or deter beyond our control Owner to carry fire.tornado and other necessary insurance
Our.pikers are Hifi covered by worsmen's Compensation Insurance withdrawn by us if not accepted within days.j
Arrrptanrr Of rropoBa1 —The above prices. specifications _
and conditions are satisfactory and are hereby accepted. You are authorized Signature
to do the work as specified Payment will be made as outlined above.
Signature
Date of Acceptance 1
19
GENERAL RESERVE SYSTEM DISCUSSION
20
MOO RE LAKE DISTRICT
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=ROM EXECUTIVE DIRECTOR MEMO NO.83-37
)ATE April 20, 1983 TO ACTION INFO.
,U BJE CT Housing & Redevelopment Authority X
Request from Tom Brickner
I met with Mr. Brickner on April 19, 1983 to see if there was any feasible way for
the HRA to assist the development without taking a direct acquisition role on the
property. If the HRA gets involved, I strongly feel that we will have to go to
condemnation to reach an agreeable purchase price with Mr. Skinner. Tom indicated
that he would talk to Mr. Skinner to find out what his total asking price is and
evaluate the present structure to see what value it would have to him.
If Mr. Brickner feels that he will not be able to purchase the property directly from
Mr. Skinner, the HRA would be well advised to hold on this matter until such time as
they can show progress on the Max Saliterman property. Any action from the HRA in
that area may create unnecessary citizen reaction. I 've explained this to Mr. Brickner,
and he indicated that there is no real hurry on his part, but that he would like to
finish off the area.
11
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83-28
FROM EXECUTIVE DIRECTOR MEMO NO.83-28
DATE March 7, 1983 TO ACTION INFO.
SUBJECT Housing & Redevelopment Authority x
Letter from Tom Brickner Requesting
Assistance for Continueation of his
Heather Hills West Development
Please see attached letter from Tom Brickner, requesting HRA assistance for the
continuation of his development to the north for the completion of Heather Hills
West. In looking at the proposal , I would recommend caution on the part of the
HRA to not be a catalyst, but assist as needed within the limitations of funds
generated by the proposal .
I have estimated that the proposal would generate six single family lots for homes
between $200,000 - $250,000. That kind of development would generate approximately
$100,000 in tax increment funds. If the HRA is interested in assisting in this
proposal, I would suggest that the HRA assist Mr. Brickner in a negotiated purchase
between himself and Mr. Skinner up to the amont of money available in the project
and then only in the amount necessary to make it a viable project.
I will discuss this further with Mr. Brickner prior to the April 14, 1983 meeting.
JLB/de
...., Designers & Builders of
i.essT.wso Fashionable Homes Since 1963ipumme 23
ISS
IX1�E R B UI Lb
Cd
4?/g. Inc. bs
574 - 9 871
6249 BEN MORE DR. FRIDLEY, MN. 55432
March 18, 1983
Mr. Jerry Boardman
City of Fridley
6431 University Ave. N.E.
Fridley, Mn. 55432
RE: Ralph Skinner Property
6211 Central Ave. N.E.
Fridley, Mn. 55432
Dear Jerry:
Brickner Builders', Inc. is interested in purchasing the Ralph
Skinner property, which is adjacent to our Heather Hills West development.
Our Heather Hills West homes are in the upper price bracket, and if
we are allowed to continue development to the North, by building compatible
homes, I feel it will be beneficial to our customers and the city will
benefit from higher taxes because of the price range of the homes.
Because this is in the redevelopment area, if the HRA purchases this
land, I would like the opportunity to buy the cleared land.
Our proposed offer is $65,000.00. Your consideration of this offer
would be appreciated.
Since -/1
oma.s E. Brickner
Brickner Builders' , Inc.
VO
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25, 200
Attention: Jerry =oarcrar.
Planning Cor.r.i t t :e /02 Bao
Citi of Fridley
t .re., Gr: frr sz ).c tc ._ty of , , t4r. • 1 ,E
ef Yrrp- y, ( le^-7 and r1L'?incs ) lccatea at 6217 Centre.' Ave. ?:. . Frilcy,
' r. , w -!ch le-al description is; lots 20 and 21, auditors cu":ivirior. Hurter 2?,
^: Ccunty, F'n. , ac. in, with the fcliowing exceptions: furnishinm and
arl:iancer in the -.cuss and a:1 tools, yrrk JEnches, shelving, ca:inet-., F,�^
furnace an rrcncrails in F'►rage. All eclu i nest, power or r.?::; 1 u7u.?7 er
inelden'__- t^ c_ t:.. ;r€-- -=. .
_hc -_ a- _ total cf tee sale lr:ce offer it ^ : E1€;hi: Fi-e
T.'.cur ar.d Cola: s, ( :2'5,000.00 ). This offer shall end=e sixty. ( 'C )
days frcm the date cf this 1:.-tr-..r.ent and nhall auteratically ex:irc at that
time if net accepted.
Or
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28
THE CITY OF E ••N..•.•..p.. N..7 •.•.•..
HOUSING N..:h•a::"\ ..... ..:.N • N�N.NN.N_
�N.N GN•:•••
and ....� .,. ..N. •
l :2ir
.N. , .=.• ...N.
REDEVELOPMENTi`='�N'� '`'�N'
MEMORANDUM..••..N. `I� ••.NWI
AUTHORITY ....N.. :r:i..... : ':::• I6:4
•••
MVO •WorailININIIPOO. MO
FRIDLEY ••
'ROM EXECUTIVE DIRECTOR MEMO NO.83-27
•'ATE April 7, 1983 TO ACTION INFO.
U BJE CT ST. PHILLIPS REQUEST FOR "RIGHT TO Housing & Redevelopment Authority x
DEVELOP A PROPOSED 202 PROJECT IN
PHASE III OF THE FRIDLEY MOORE LAKE
REDEVELOPMENT PROJECT."
St. Phillips Human Services, Inc. has requested a "Right of Development"
from the HRA for the above noted project. The project is similar to the one ap-
plied for in 1982 and denied by HUD in their overall ranking of projects. The
project as presented will generate approximately $325,000 in usable tax increment
funds based on conservative capitalized interest estimates. I have attached a
"Right of Development Letter" for this project for your consideration.
We have taken the necessary action requested by the HRA for soil compaction
tests on that site. Soil Exploration Company is working directly with the
architect for St. Phillips Human Service, Inc. to provide the appropriate in-
formation they need for site analysis.
JLB/j h
• N•NN......N...•N.
TIME CITY OF .... .:::ii.�:.-......• _• L N•N
•• N .•NN•••.•
HOUSING ::� ;....N ...:�:: ':N';•--- ``•N.....N. ..:
Arsorgif •• �• MB: •NN
and --,y^
(11; REDEVELOPMENT W„ •
4 2000 ••N•
AUTHORITY ; f ::::: ::::: .
F F71 D ...44
. :::N•••.
April 15, 1983
St. Phillips Human Services, Inc.
6180 Highway #65 N.E.
Fridley, Mn 55432
RE: Right to development 202 Project in Phase III of the Fridley Moore Lake
Redevelopment Project
Dear St. Phillips Human Services, Inc. :
The Fridley Housing and Redevelopment Authority at their April 14, 1983 meeting approved
your request for Right to Develop a portion of Phase III of the Moore Lake Redevelopment
Project. This approval is based on your preliminary presentation to the Housing and
Redevelopment Authority on April 14, 1983, for the minimum development of a 60 unit
Elderly /Handicap Housing Project. This approval is also contingent upon the following
factors and these contingencies shall only be removed by decision of the Fridley Housing
and Redevelopment Authority.
1. That until final plans are accepted by the Fridley Housing and Redevelopment
Authority, (final plans include final architectural drawings, letter of
commitment for financing and a signed disposition agreement between the
Fridley HRA and St. Phillips Church). St. Phillips Church is acting on its
own risk and shall not assume that the Fridley HRA is morally or legally bound.
2. That St. Phillips Church proceed to work on the submission of a 202 applica-
tion to the Department of Housing and Urban Development. Approval of site
plan by the HRA will require St. Phillips Church to proceed on a schedule
of work leading to financial commitment for construction to begin October,
1984. This time period will be extended only by the approval of the HRA. The
schedule of work shall be jointly established by the HRA and St. Phillips
Church upon acceptance of this selection. Each party shall keep the other
informed of potential problems and delays. If, in the opinion of the Housing
Authority, St. Phillips Church is not proceeding in a timely and positive fashion,
or if the application submitted to HUD is denied, the HRA may withdraw this
selection.
3. That the selection herein given allows St. Phillips Church exclusive rights
within the law to promote, study and plan for the redevelopment of that portion
of land area in Phase III generally decribed as follows:
The southwest corner of Central Avenue N.E. and Rice Creek Road N.E.
_ St. Phillips Human Services, Inc.
Page 2
April 15, 1983
4. That the HRA shall guarantee St. Phillips Church that they will acquire the
necessary property for the project. (The actual site can be redefined based
on the actual cost of the site to the HRA provided the site meets the necessary
City codes) and sell the project site to St. Phillips Church for the project.
The purchase price to St. Phillips church shall be determined by a Court
established or negotiated value on the original acquisition less $325,000
in tax increment funds. (The $325,000.00 in tax increment funds are based on
the development of 60 units with a building value of $2,000,000 paying an
estimated $69,000 in taxes).
Other reasonable and legal alternatives for public assistance to the developer
shall be explored by the HRA. These funds may be available to write down
additional cost on the project. These funds include, but are not limited to,
1984 Community Development Block Grant funds, additional tax increment funds
from the overall district, delayed assessments, donations, etc.
5. That St. Phillips Church agrees to provide the HRA and its staff such plans and
financial projections as necessary as determined by the HRA to allow for accurate
land use analysis, site plan analysis, financial analysis and legal analysis.
6. It is understood and agreed by St. Phillips Church that this selection may be
terminated for cause by the HRA at any time prior to the execution of the
disposition agreements and that St. Phillips Church agrees to hold the HRA
harmless for any damages or expenses incurred under this selection.
Please contact me when it is convenient for you so that we may be able to set up the
necessary work schedules so that the project can move ahead in a timely manner. Also,
would you sign a copy of the letter enclosed and return it to me so I know that you have
received and understood the conditions laid out by the HRA and will proceed in a timely
manner toward final action between yourself and the Fridley Housing & Redevelopment Authority.
If you have any questions or if I can be of assistance to you, please feel free to call me
at 571-3450.
Sincerely,
JERROLD L. BOARDMAN
Executive Director
Fridley Housing & Redevelopment Authority
JLB/de St. Phillips Human Services, Inc.
C-83-26 By
PLEASE SIGN AND RETURN
.,- -,oc.
I
) . '°�°`► 31
ai 3 � � ova 3 , i
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- p i I d
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32
EXHIBIT 1 . 00 5/25/82
BONK ISSUE DETERMINATION FOR:
FRIDLEY MN 1983 TAX INCREMENT FINANCING
CONTRACT COSTS 395, 586
LEGAL, FISCAL R ADMINISTRATION 2. 50% 12, 500
SUBTOTAL 405, 086
LESS FUNDS AVAILABLE:
CASH FLOW DURING CONSTRUCTION 17, 890
17, 890
SUBTOTAL 390 , 196
LESS INVESTMENT [1 . 00 YEARS Of 13 . 00%] 64, 999
NET PROJECT COST 325, 197
INTEREST DURING CONSTRUCTION [2 . 75 YEARS @ 12. 00%] 165, 000
PRINCIPAL AMOUNT NEEDED 490 , 197
DISCOUNT ALLOWANCE [2 . 00%] 9, 803
SUB TOTAL 500 , 000
ADDITIONAL CONTINGENCY E . 000%] 0
BOND ISSUE 500 , 000
DISC 1 FILE 30 PROGRAM COPYRIGHT BY EHLERS & ASSOC, INC . 1/12/1981
i 364
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FINANCIAL
35
OTHER ITEMS
I
1
INFORMATIONAL ITEMS ONLY- NOT ON AGENDA
I
k THE CITY OF �•�•NN••
4.4-01 HOUSING ;Immo" �.... ..:r:::•�• :•
and ... '
REDEVELOPMENT N•.r MEMORANDUM \_--:
(\VA AUTHORITY ......
OWO
DSO
,�,. •
' : „ i.......! I
FRIDLEY
FROM EXECUTIVE DIRECTOR MEMO NO. 83-22
DATE March 28, 1983 TO ACTION INFO.
SUBJECT Nasim M. Qureshi y
Status of ELO Engineering IRA X
As we had indicated to the City Council and the HRA during our previous discussion
on the General Reserve Fund System, ELO Engineering had intended to move to Coon
Rapids to develop a new facility. They had decided not to locate in Fridley because
of the benefits that were being promoted by the City of Coon Rapids to draw in new
business.
We have been working with Mark Haggerty, who is representing ELO. Mark has convinced
ELO to hold off on making a commitment with Coon Rapids based on the possibility of
providing assistance through the General Reserve Fund System that we are looking at
with Piper, Jaffray & Hopwood.
If they stay in Fridley, they would be looking at expanding their present facility
by connecting their existing building to the South. The building to the South is
presently vacant and they have taken an option on the property until June 30, 1983.
Mark has indicated that they have been able to arrange bank financing on this project
subject to a workable reserve system. This may be an ideal first project for the
reserve system provided that the City Council and the Housing & Redevelopment Authority
concur with the programs that will be presented by O'Conner Hannon for the system.
We will continue to work closely on this matter and keep you informed on its progress.
JLB/de
34_
.,
S 1/2 SEC. 2. T 30,
CITY OF FR/DLEY
CITY OF SPRING LAKE PAI
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} REDEVELOPMENT .....
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FRIDLEY _ =..N.:..
FROM EXECUTIVE DIRECTOR MEMO NO. 83-30
DATE March 8, 1983 TO ACTION INFO.
SUBJECT Housing & Redevelopment Authority X
Possibility for Stock Piling Fill for North
Area District
If we are going to make the North District work, it will take a considerable amount of
granular fill to assist projects with major soil problems. As one means of providing
this fill , we are considering the possiblility of setting up space for stockpiling
excess granular fill from various projects within the Twin Cities Area. I have been
working with the City Manager and the Public Works Department in trying to set up
the potential for stockpiling.
I will keep you informed on any development with regard to this item.
JLB/de
37
WriterqUestiàns FridIyHRA1
But the HRA apparently operates The upcoming mayoral report
To the editor: . under entirely different economic (published just before elections)
Two years ago,the Fridley Hous- principles. won't highlight the quagmire the
, ing and Redevelopment Authority The final insult to taxpayers in- HRA has created. The city council
(HRA) used federal tax dollars to telligence is to learn that Jerry has seems to feel they don't have con-
buy the Fridley Hardware building rented the building to a "flea mar- trol or responsibility for the HRA
for something like$200,000. ket" but after several months has yet the mayor appoints HRA mem-
one knows our , ' •• sta e never received any rent. bers.
• nig" �,���n�• • to urn. Think for a minute. Money the yhile Holly Center is
1 federal government in effect bor- unable io ittrA ilt.a.._�, `•ijor
c v
c HRA Executive Director rowed, used to buy a building to ire,your A stiill]l envisions
Jerrold (Jerry) Boardman then leave it vacant and in desperation, nnolfi' major shopping center
elected to leave the building vacant, renting it out to a group that pays across the street.
baking in the hot summer sun. If a you no ren o I .it Can we taxpayers afford to allow
few of us taxpayers had directlyg r f crag an ti4,96.T.•_!
c .6 this financial bungling to continue?
invested money in this building, eante 'w'? # t+++w a Michael J.Larson
would we have left it vacant and 7trr'i-d BRA a d�gur city Fridley
made no effort to produce a return r i v e s1itfrc rea rd'for'tax
on our investment? Ofnot. oars.
i
50
6230 Jupiter Drive N.E.
Fridley, Minnesota 55432
March 23, 1983
Jerry Boardman
HRA Director
6431 University Avenue
Fridley, Minnesota 55432
Mr Boardman,
If the enclosed article in the recent Fridley Sun is correct, I 'm
just as mad as Michael Larson.
We have been home owners and taxpayers in Fridley since 1957 and
have seen a steady deterioration of grocery shopping facilities
in our area. The exodus through the years of National, Penny' s,
Red Owl and I understand that Cub will soon depart, has left
Fridley with little choice in grocery shopping.
To the average taxpayer, paying $200,000.00 for the hardware
building seems out of line.
A stranger driving through Fridley' s "Downtown" is not impressed
with the vacant buildings and barren lots.
:',hat do you eorle have n mind?
I will look forward to your reply.
Since e
11100
Keit
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i c -A...e....ec, )14.....„,,, — 7716-44.4 3 c), / '.1'3
N
Larson : role of HRA •
To the editor: First, our HRA tears down the excess of $200,000 for landscaping
Well, our property tax park, cutting down beautiful the new park. (Taxpayers may be
statements sure made interesting mature oak and other trees. interested to know that at the time
reading this past week. Second, through their tax incre- the bids for this project were ac-
The portion of our taxes that goes ment districts,they restructure the cepted last week,the drawings ap-
to our schools is justified because entire area around city hall. The parentiy made no provision for the
the education of our children is our buildings within the district won't handicapped.)
most important social endeavor. provide additional tax dollars for The net result?
The school board sees to it that our our schools,the county or the city. The HRA spends something like
tax dollars are spent effectively and For up to 20 years.the property in a $500.000 to achieve a marginally
efficiently. tax increment district no longer improved park and parking area,
• The city council should take ac- contributes to the growth in our tax the burden for funding our schools
tion though to reduce the role of the base. The net effect is that that and government for the next 20
Housing and Redevelopment Au- burden is placed on homeowners. years is placed more on the backs of
thority (HRA). I'm convinced Third. the HRA spends around homeowners and we have a park
we're headed for trouble that will $300.000 buying the Fridley Center with young trees to replace a park
affect our ability and our willing- building that houses several busi- with mature trees.
ness to support all our taxing dis- nesses. The purpose? To bulldoze For my money. the more we.
tricts,especially our schools. the building to replace some park- restrict HRA activities the better
Look at what has happened to ing areas. for us all.
Eisenhower Park as an example. Finally, the HRA will spend in Michael Larson,
Fridley
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4-. ..
Writer criticizes
`urban renewal' .
To the editor: ceived special recognition from the'
In 1965 the voters of Fridley told governor, no urban renewal — no
the city council, at the polls, that special tax incentives.
they didn't want what was then But alas.The pro urban renewal
called Urban Renewal. people don't give up.They are using
Most of us know there is no such the same old book with a new cover.
thing as a free lunch and could see- All the same old claims, the same
the folly of urban renewal.We could dangers. Housing and Redevelop
see that all the projects throughout ment Authority still has the right to
the nation had failed and Fridley's condemn property; the same way
would surely fail also.Fridley quali- of robbing the established business
lied for urban renewal only because to give a handout to the new busi-
of the flood and tornado. ness while telling us it will cost us
Mayor Nee and his followers said nothing. Believe me, it's the tax-
we needed urban renewal to re- payer who must foot the bill. You
build; to redevelop the flood plain; and I make up for the lost revenues
to remove those ugly power lines of the businesses that were driven
from University Ave.; to attract out. You and I pay for the lost
new industry and commercial de-' revenues that would normally have
velopment; etc. They had a $3 been collected from the newly at-
million,five year plan. tracted business.
We, who believe in our free en- Now they call it "Tax Increment
terprise system said,"We can do all Financing." but it's just — Nee's
of these things in less than five Urban Renewal. And the
years without urban renewal," — philosophy seems to be:never mind
and. we did. People rebuilt their the people said,"—we don't want it
tornadodamaged property and in —,"just change the name and give
nearly all cases greatly improved it to them anyway, after all, big
their property. Unless the Missis- brother knows best.
sippi rises above the 100 year year Look what Fridley did with tax
flood of 1965, the "Fridley Flood increment financing compared to
Plain" has been made safe by the what they are doing with Nee urban
dyke built without urban renewal. renewal.Example: the half million
The ugly power lines are gone from dollar "improvement" program
University Ave. — no cost to the around city hall.
taxpayer. We attracted so much Jack O.Kirkham
new industry in 1967 that we re- 430 67th Ave.NE
Fridley
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St. Poul Pioneer Press/Dispatch Monday, February 2L 1983
, r .
Sliding_tax
•
revenues________ _
rraiSequestions abonds
_. ,
By Patrick Boyle ' -. - `It'a not realistic to wry that a
Los Angeles noes will default on its debt, bot
there is concern about the lower ; Personal finance
It was a bondholder's nightmare levels of government," said Tom
come true. Gamello, a credri analyst with the States probably Mount San Jacinto State Wall Street firm of Prescott,Ball p y
Park Authority sold $8.15 million & Turben Inc. "A state in trouble won't default on
in revenue bonds in the early 1960s has to preserve its fiscal integrity, 'ts debts, but there is
to build the Palm Springs, Calif., and that means local ��
aerial tramway up the aide of the dependent on stale ofd could av concern about
mountain. But train ticket sales fer."
fell short of expectations, and in Rating cuts are often of as
November 1966, three years after much concern to taxpayers as to local government.
the tram went into operation, the investors. Government agencies
park authority missed an interest sell general obligation bonds as a near what they were in the Great
payment to the bondholders. The form of long-term borrowing, as- nDepression,"rwhothey said Guy
bonds were declared in default, ing the proceeds to finance the 'manager municipal Wickwire,bond
and, at one point,the interest pay- construction of schools, officePana for of twoy Group, Bos-
meats were running as much as buildings, highways, prisons and ton-based mutual fund holding•
two years late. other government projects. They
also sell short-term notes in . company. "And we don't antici-
edSucb horror stories are recount- may pate the strains will become
more often these days by manic- , anticipation of using expected tax that that the
The strains
roves-
ipal bond traders watching the de- receipts to pay back the lenders. I torhis prows much assuredri ves-
clice in the credit ratings of states .a mately being paid off."
and local government borrowers. Rating important Indeed, even long-term
The long recession has pinched the The interest rates are often holders f the Palm theSogs
tax revenues of government ager- ' lower than what the government way bonds are being paid off,tram-
cies throughout the nation,making agency would have to pay to boa- though a bitrbehind schedule.
al-
it more difficult for them to pay row from a bank, but investors Tram manager behind
Ficker says
past debts while still providing have an incentive to buy munici- that payments to arey
services to the citizens of their pal bonds because the interact , now running about 1 bondholders months late,
communities. earnings are exempt from federal, but that should beo back on
While there have been no major and sometimes state, income tan- schedule theyby May .
defaults since the Depression,lead- es. The bond rating-helps deter-
ing bond analysts have lowered the mine the interest rate,and thus is But of more immediate concern
credit ratings of hundreds of gov- extremely important to the issu- to bondholders than outright de-
ernment agencies, raising goes- ing agency and its taxpayers. fault is what can happen to the
tions about how secure an invest- A difference of 4one-fourth of a market value of a bond backed by
went is in the debt obligations of percentage point in the interest a government agency whose bond
municipal governments,school cis- rate on a $100-million issue could rating has been cut by Standard&
trick or other entities. cost the agency an extra 250 000 Poor's Corp. or Moody's Investors
•• ,• . ' a year in interest payments,or 5 ServiceInc., the two major Wall
Street bond-rating agencies.
Risk higher • i�r`` Ilion over the life of a 20�ear '
bond issue. •
Most analysts and investment idvisers agree that investing in municipal bonds is a little more g Some analysts contend that,
given the economic pinch govern-
risky than it was a few years ago, meats are facing, the prospect of
primarily because so many mu- a state or local government bor-
nicipalities have gotten into sari- rower having trouble meeting its
ous fiscal trouble. -- -� debt payments on time should not
A recent survey by the TI[cmSd- be ruled out.But at the same time,
experts say, certain municipal
pal Finance Officers Association bond issues continue to rank
found that U.S_ci ides were ezpect- among the best and most secure of
iiig an average 1982 bud et deficit investment values.
of ;10 per capita, comps a "The strains today are nowhere
fcaPita i .•the National Association of
State Budget Officers says that
the 50 states, which ended fiscal
1981 with an aggregate surplus of
$5 billion, expect to have an ag-
.gregate deficit of $2 billion in fis-
cal 1983.
St. Paul Pioneer Press/Dispatch • Monday, Feb. 21 , 1983
S&P recently lowered its rating on long-term Treasury bills used management of the public entity cause Texas has an_ ;11 billio-
t California's debt from "AA- to be about 65 percent, but that and their ability to raise addi- twdge_jyrplus and issues 3e
lus" to "AA" — better than the the ratio is now about 75 percent. tinnal income in tight economic ids.its debt is mom attracti-
&P ratings of only seven other In other words,the municipalities times,"says Robert Hedrick, vice to investors than is Vira;n,a•S.
tater and worse than the "AAA" must pay more to borrow on the president and manager of public
sting the state had as recently as public debt market finance at Crocker National Bank "Investors have to watch fa
980, before the tax-cutting ef- "That's a very serious rhange, in San Francisco. safety first, then liquidity and tht-
ects of Proposition 13 began to be and there does not appear to be Because of these intangible fac- yield,"says Marilyn Cohen, a bor.
elt. During all of 1982, _Moody's any reason to believe that the ra- tom adds_, two issues with tie specialist with the Beverly Hil►,
owered its credit rating-6j 263 do will improve,"Kelley said. kame credit rating mAy not trade Calif., investment firm of Canto
issue com_pa�g a the§arn prize. ,For example, Fitzgerald & Co. "It used to be tk.
O onl 62�uctions in For a bondholder, the change in ne says, both Virginia and Texas other way around. You looked-,-
'g81 Y a credit rating of the government agency backing his investment is have 'XAA bond raticps-,but 1 yield first."
These cuts have not only affect- usually of little concern if he plans _ _ -_
d the prices of some bonds al- to keep the bond to maturity. If
-eady in the market,but they have the investor buys a 20-year gener •
-
ilso raised the interest rates gov- al obligation bond with an 8.5 per-
Irnment entities must pay on new cent interest rate, he will get an
iebt issues. This can be good for interest payment of;85 a year for
he investor looking for tax-free each $1,000 invested, regardless
income, but bad for the state, of what happens to the bond rating
school district or power authority or to the bond's price in the mar-
issuing the bonds. ket.
"We like to say that the triple-A The investor is usually only con-
rating is an endangered species." cerned about the rating or the
said Joseph Kelley, assistant di- market value if be decides to sell
rector of the Government Finance the bond. Bond specialists say the
Research Center of the Municipal effect of a rating cut on bond
Finance Officers Association in prices is not easily measured.The
Washington,D.C. price of an individual bond in the
Interest rates on new municipal secondary market depends on a
bond issues tend,to rise with the number of factors, including the
amount of risk investor takes relative size of the government
in buying the debt instrument,and agency, the volume of bonds out-
Kelley says those rates have in- standing and the extent to which
creased significantly in the last the agency's financial difficulties
two years as a result of changes in became public knowledge before
the tax laws and the fiscal prob- any rating change.
lems of issuing agencies. "All municipal bond credit rat-
Kelley says that the ratio of mu- Ings are based on the economy of.
nicipal bond interest rates to rates the region, the soundness u( *el
HERRICK & NEWMAN. P.A.
V,wGR C.MEwwICK ATTORNEYS AT LAW 11279 UNIVERSITY AVENUE h t
DAVID P.NEWMAN FRIDLEY,MINNESOTA 55432
April 13 , 1983 571.38S0
•
Mr. Sid Inman
City of Fridley
6431 University Avenue N.E.
•
Fridley, Minnesota 55432
Dear Mr. Inman:
You inquired as to whether or not the hardware building owned
by the H.R.A would be exempt from real estate taxes if the
premises were leased to a non-profit organization. It is my
opinion that the building would not be exempt from real estate
taxation.
In reviewing the statutes on this matter, it is best to assume
that all property is subject to real estate taxes unless an
explicit exception is provided. There are some exemptions for
institutions of purely public charity, M . S .A. Section 272 .02 ,
Subdivision 1 ( 6 ) . However, I do not believe that the Lions
meet this definition. There is an attorney general ' s opinion
which does state that property leased to a non-profit curling
club corporation would be taxable , Op. Atty. Gen. , 4-J , Nov.
13 , 1970.
There are some additional statutes which appear to be somewhat
contradictory and are confusing. I have reviewed this matter
with both the League of Cities and the Anoka County Assessor
and both of those parties have informed me that it would be
their opinion that the property would be subject to taxation.
Regardless, even if the property were deemed to be exempt ,
M.S.A. Section 272 . 68 Subd . 3 , states that if the public author-
ity leases the property and it remains exempt from taxation,
then the rent must be a reasonable rate and 30% of all rental
received must be paid to the County Treasurer.
In summary, it is my opinion that the property is subject to
taxation, although, a contrary argument could be made. As a
practical matter, though , the County Assessor will take the
position that it is subject to taxation and even if it is not ,
30% of all rent must be paid to the County Treasurer.
Sincerely yours,
David P. Newman
DPN:kao
•Ac: Jerry Boardman
MEMORANDUM
April 7 , 1983
MEMO TO: Mr . Jerrold L. Boardman
Executive Director
Fridley Housing and Redevelopment Authority
MEMO FROM: Mr . David P. Newman P'—
Assistant City Attorney
SUBJECT: Clothing Liquidators, Inc .
You inquired of our office as to whether or not a mechanic ' s
lien could be filed against real property owned by the
Fridley H .R.A.
It would be my opinion that it could not . The reason for this
is that the courts have generally held that mechanics liens could
not be filed against property held for the public purpose ,
Burlington Manufacturing Company vs . Board of Court House , etc . ,
Commissioners, 67 Minn. 327 , 69 N .W. 1091 ( 1897 ) . I should
caution you that every court decision on this topic has
dealt with property which was being used for public purpose .
In the present situation, it could be argued that since the
H . R .A . was leasing the property to a private individual that
the property was not being used for a public purpose .
However , it would still be my opinion that a lien could not
be filed because the reasoning behind the court ' s decision
still applies .
The reason why the courts have not allowed the filing of
mechanics liens is based upon M. S .A. Section 465 . 13 . This
Statute provides that once a judgment is obtained against
the municipality, then upon the judgment being presented to
the city clerk, he must immediately pay the judgment if
there is sufficient funds available . The courts have reasoned
that since there is this method to insure the payment of
judgments, then contractors do not need the extraordinary
relief which is provided by the mechanic ' s lien statute .
The result is that the contractor cannot file a mechanic ' s
lien but upon obtaining a judgment against the City of
Fridley, he must then be immediately paid .
In reviewing this matter , it would also be my opinion that
if the contractor were to sue the City for the amount owed ,
that he would prevail . The basis for this opinion is that
1) we instructed the tenant to procure these repairs so he
was acting on our behalf when he had the windows repaired ;
2) the H . R.A. has benefited from this work and it would be
inequitable to allow the H. R.A. to obtain the benefits
without paying for them.
In summary, it would be my opinion that the contractor
probably could not successfully foreclose on his mechanic ' s
lien but that he could bring a separate lawsuit against the
City and prevail on that .
.N!
I