HRA 01/10/1991 'I
HOUSING AND REDEVELOPMENT AUTHORITY
MEETING, THURSDAY, JANUARY 10, 1991
7:30 P.M.
PUBLIC COPY
CITY OF FRIDLEY
AGENDA
HOUSING & REDEVELOPMENT AUTHORITY MEETING
THURSDAY, JANUARY 10, 1991, 7:30 P.M.
Location: City Council Chambers
Fridley Municipal Center
6431 University Avenue N.E.
CALL TO ORDER:
ROLL CALL:
APPROVAL OF MINUTES: December 13, 1990
ACTION ITEMS
RMS DEVELOPMENT AGREEMENT
RESOLUTION DESIGNATING OFFICIAL DEPOSITORIES FOR FRIDLEY HRA
ESTIMATES
CLAIMS
INFORMATION ITEMS:
TARGET PROJECT - Note potential for TIF request
UPDATE ON UCD PROJECT
UPDATE ON RICE PLAZA
MEMO REGARDING APPLICATION FEES AND PROCESS
INFORMATION REGARDING PAST HOUSING REHABILITATION PROGRAM
FRIDLEY OFFICE PLAZA BUILDING
STATUS OF TAX COLLECTIONS FOR VARIOUS TAX INCREMENT PROJECTS
1991 BUDGET (to be distributed at meeting)
OTHER BUSINESS
ADJOURNMENT
** Please note 7:30 p.m. meeting time! !
' � i
t
CITY OF FRIDLEY
HOUSING & REDEVELOPMENT AUTHORITY MEETING, DECEMBER 13, 1990
CALL TO ORDER:
Chairperson Commers called the December 13, 1990, Housing &
Redevelopment Authority minutes to order at 7:10 p.m.
ROLL CALL:
Members Present: Larry Commers, Virginia Schnabel, John Meyer,
Duane Prairie
Members Absent: Walter Rasmussen
Others Present: Bill Burns, Executive Director of HRA
Barbara Dacy, Planning Coordinator
Rick Pribyl, Finance Director
Paul Hansen, Accountant
Jim Hoeft, City Attorney
APPROVAL OF NOVEMBER 8, 1990, HOUSING & REDEVELOPMENT AUTHORITY
MINUTES:
MOTION by Mr. Prairie, seconded by Ms. Schnabel, to approve the
November 8, 1990, Housing & Redevelopment Authority minutes as
written.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
1. PROPOSED TAX INCREMENT TURNBACK TO SCHOOL DISTRICTS:
Mr. Burns stated that in addition to the agenda material, the HRA
members were given an updated memo entitled "Update on Information
Regarding Interest and Penalties on Delinquent Taxes from Skywood
Mall" .
Mr. Pribyl stated that as the HRA stipulated, he is bringing this
agreement to the HRA earlier than in the past so that the school
districts can incorporate this into their budgeting processes.
Staff has provided the HRA with an estimate of what they feel this
agreement will actually return to the various school districts
within the boundaries of the City of Fridley. This year the
estimated amount is $268,958, the most significant amount returned
to date.
Mr. Pribyl stated one item he wanted to clarify is in regard to the
penalties and interest on the Skywood Mall. In his memo he made
HOUSING & REDEVELOPMENT AUTHORITY MTG. , DEC. 13, 1990 PAGE 2
a comment regarding the windfall to School District #13 and
possibly holding back $113, 500. The Finance Department of the
Department of Education has just clarified what happens with those
penalties and interest. These penalties and interest are actually
part of a formula, just as the City has a formula for the levy
limit and the state aids. These penalties and interest for the
school district are part of their formula in their determination
of their per pupil aid that they received more in penalties and
interest because they are actually coming through with the tax
settlement that actually reduces their aid. So, School District
#13 is not privy to a windfall of $113,500, because their aids are
reduced proportionately by that amount. What really happens is the
State of Minnesota then is the benefactor of that $113,500; it is
not the school district. As it stands, he is asking the HRA's
approval of these agreements without any stipulations.
Mr. Burns stated that if the HRA withholds the $113, 500 turnback
to School District #13 , the State does not kick in with more aid.
Mr. Pribyl stated that in regard to the referendum return, this
amount of money does not enter into the State's calculations. So,
this amount of money would be a true return to the School District.
If the HRA holds back the $113 , 500 from School District #13, they
will not get that amount of money back from the State, because it
is not part of the apportionment process that is figured into their
taxes and the School District would be penalized for something they
did not even receive.
Mr. Commers stated there is a bigger policy issue that has been
raised every time they have discussed this subject, and that is
the purpose of the refunding to the school districts and the fact
that they are doing it now in December 1990 for the 1992 fiscal
year without knowing what, in fact, will be the HRA's financial
position. That raises issues in view of the fact that they have
a major project under dispute which may cause a significant
financial commitment from the HRA. He is not so sure the HRA can
just continue to promise the return of these funds to the school
districts two years in advance. The original reason was not that
this was going to be an ongoing process, but he did know there have
been a number of issues raised by the schools and they do have
problems, so it is very difficult to draw the line. But, from a
philosophical and policy point of view, it is something the HRA
will need to address again. He believed the HRA said they would
consider it this time; but it is something they will have to watch,
especially since the dollar amount has increased significantly.
Mr. Prairie stated that it might be prudent for the HRA to set a
maximum dollar limit on the return to the school districts and not
exceed that amount. Setting a limit would provide the HRA some
protection from these increases.
Mr. Burns stated he would like to make two observations:
HOUSING & REDEVELOPMENT AUTHORITY MTG. , DEC. 13, 1990 PAGE 3
1. It is important to go back to the rationale that supports
the HRA's option, and the rationale behind the
legislation gives the HRA this discretion that this
referendum money is money that was not anticipated at
the time the tax increment financing district was set
up.
2 . They have seen a lot of increase in their return to the
schools, but he believed as Moore Lake Commons and the
Moore Lake Racquet, Swim, & Health Club have been
completed that they are probably getting close to the
point in time when they will not see these large
increases.
Mr. Meyer stated that if they put a cap on the amount of money to
be returned to the school districts, the school districts would be
put on notice that they cannot continue to expect increasing
returns.
Mr. Pribyl stated the way the agreement is now written, it actually
stipulates that the increments will be returned. By approving and
signing the agreement, the HRA is bound to return the amount
collected.
Mr. Burns stated the HRA might want to consider tabling further
discussion and before voting on it, look at their revenue flow and
compare it with the projected projects. The HRA has not done that
for awhile, and it might be timely to do that as they start a new
year.
Mr. Commers stated that he thought the HRA should be honest with
the school districts that the HRA may not be able to continue
returning these kinds of monies in the future. He did think the
HRA should make a commitment to the school districts, but they
should make the commitment less than what it is--possibly $200,000.
Mr. Meyer stated he thought the HRA should send a noticeable signal
to let the school districts know that the HRA is trying to build
a noticeable reserve for any future needs the HRA might have.
MOTION by Mr. Meyer, seconded by Ms. Schnabel, to authorize a
referendum levy return to School Districts #11, #13, #14, and #16
in the amount of $200, 000, payable out of the referendum recovery
of 1991, payable to the school districts in 1991-92 ; the total
amount to be prorated among the four school districts.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
Mr. Pribyl stated the agreements will be modified to incorporate
this dollar change.
HOUSING & REDEVELOPMENT AUTHORITY MTG. , DEC. 13, 1990 PAGE 4
2. SIGN PERMIT FOR FRIDLEY PLAZA PHARMACY, FRIDLEY PLAZA OFFICE
BUILDING:
Ms. Dacy stated this request is brought to the HRA as a result of
the original development contract for the Fridley Plaza Office
building. The original development contract was quite specific on
the type of exterior signage allowed. There is no wall signage on
this building, except for the signs within the tenants' windows.
Staff wanted to bring this request before the HRA and the City
Council to make sure that this request is consistent with the
original intent of the development contract and the intent of the
redevelopment district.
Ms. Dacy stated the Fridley Plaza Pharmacy is proposing to put a
sign right above their tenant space on the south side of the
building across from the Fridley Plaza Clinic. The owners of the
pharmacy have received a number of complaints from their clients
regarding the clients' ability to see the pharmacy from 5th Street
and from their elderly patients coming from the clinic across the
street. The Fridley Plaza Pharmacy wants to put up a 17 sq. ft.
sign which will say "Pharmacy" . The height of the letters is about
18 inches, and the length is 11 feet 4 inches.
Ms. Dacy stated staff is recommending that the HRA approve the sign
permit request for the Fridley Plaza Pharmacy with the following
two stipulations:
1. The letters be a golden color consistent with other
window signage on the building;
2. No additional signage be permitted for the building
unless the HRA and the Council consents to accept
additional exterior signage for the building.
Ms. Dacy stated it was staff's interpretation that the original
intent to control the signage on this particular building was to
minimize the impact of the appearance from along University Avenue.
This particular sign would be on the south side of the building and
would not be very visible from University Avenue. However, if one
tenant has a sign, there is nothing to prevent another tenant from
petitioning for additional signage.
Ms. Dacy stated staff has expressed their recommendation to Tony
Krajeci, the building manager. Mr. Krajeci agreed with staff's
recommendation and stipulations.
Mr. Commers stated he believed one of the reasons the HRA put a
restriction on exterior signage was not with so much concern about
the appearance of the building from the University Avenue frontage,
but more because it was the HRA's desire to maintain control over
the exterior and general appearance of the building.
HOUSING & REDEVELOPMENT AUTHORITY MTG. , DEC. 13, 1990 PAGE 5
Mr. Commers stated he could certainly understand the desire and
need by the Fridley Plaza Pharmacy for this sign.
Mr. Meyer stated the sign is not going to be illuminated so that
is not an issue.
MOTION by Ms. Schnabel, seconded by Mr. Prairie, to approve the
sign request as proposed by the Fridley Plaza Pharmacy with the
following stipulations:
1. The letters be a golden color consistent with other
window signage on the building;
2 . No additional signage be permitted for the building
unless the HRA and the Council consents to accept
additional exterior signage for the building.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
Mr. Commers stated he was not sure the City Council had the right
of final approval on the development agreement for the Fridley
Plaza Office building. He believed it was just the HRA.
3 . ESTIMATES:
a. The Kordiak Company (Rice Plaza)
Mr. Hansen stated the HRA no longer needs to approve the
management fee for The Kordiak Company. It is part of
the check register and part of the normal operating
billing.
Mr. Commers stated it might be helpful for The Kordiak
Company to submit a written memo to the HRA on the status
of the tenants in terms of the rent payments.
Mr. Pribyl stated staff can contact Mr. Kordiak and find
out what his policies are as far as rent payments. Staff
can then give the HRA a monthly status report based on
the rent checks received.
4 . CLAIMS (2082-2089) :
MOTION by Ms. Schnabel, seconded by Mr. Prairie, to approve
the check register dated December 13, 1990, as submitted.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS
DECLARED THE MOTION CARRIED UNANIMOUSLY.
5. CONSIDERATION OF 1991 MEETING DATES:
•
HOUSING & REDEVELOPMENT AUTHORITY MTG. , DEC. 13, 1990 PAGE 6
The HRA members were in agreement with the following 1991
meeting dates, with the time of the meeting changed from 7:00
p.m. to 7 : 30 p.m.
January 10 July 11
February 14 August 8
March 14 September 12
April 11 October 10
May 9 November 14
June 13 December 12
6. PROPOSED AGREEMENT TO ASSIST PROPOSED NEW RMS PLANT WITH ONE-
HALF OUTSTANDING SPECIAL ASSESSMENTS:
Mr. Burns stated it is staff's plan to have either a
resolution or a very small development agreement prepared for
the January 10, 1991, HRA meeting.
Ms. Schnabel stated that the City Council will discuss this
proposed agreement on December 17, 1990. She stated she would
like staff to give the HRA a general report on the
discussions.
7 . STATUS OF THE CORRECTIVE ACTION AT 57TH PLACE:
Ms. Dacy stated she had just spoken that day with the MPCA
staff member following this project. As far as the MPCA is
concerned, they feel that Delta Engineering is continuing to
do the additional studies they want. She had also received
a telephone call from Jack Lemley of Ashland Oil that day.
Mr. Lemley wanted to know if the HRA would be discussing this
particular redevelopment area. She told Mr. Lemley that the
HRA would not be discussing it. She stated she asked him
where Rapid Oil is with their particular plans, and Mr. Lemley
said he could not discuss that at this time. They have agreed
to contact each other in January.
8 . STATUS OF UNIVERSITY/MISSISSIPPI STREET IMPROVEMENT PLANS:
Ms. Dacy stated that when the HRA discussed this item on
November 8, 1990, the Council was going to consider the
improvement issue at their November 13th special meeting.
The Council did that and agreed in concept with installing
the street lights and all the elements of the University
Avenue Corridor concept the HRA has agreed to pay for.
Ms. Dacy stated that in Mr. Flora's memo dated November 29,
1990, he stated that the City can expect an agreement from
Anoka County requesting approval and identifying the
appropriate fund participation, and this will come to the HRA
HOUSING & REDEVELOPMENT AUTHORITY MTG. , DEC. 13, 1990 PAGE 7
for approval. The County is in the process of amending their
plans.
Ms. Dacy stated that Councilmember Steve Billings is quite
concerned that when the new median is constructed down the
middle of Mississippi Street, it will block the full traffic
movement area where, the frontage road now intersects with
Mississippi. Councilmember Billings has received a lot of
comments from the neighborhood expressing a need to get out
of the neighborhood and be able to go both directions on
Mississippi. The Council has instructed Mr. Flora to come up
with a method to maintain some type of temporary access during
construction and until the southwest quadrant can be
developed.
Ms. Dacy stated that also in process, staff is still working
with Don Fitch, owner of the Dairy Queen, regarding the impact
this has on his drive-through. A meeting was scheduled with
Mr. Fitch last week, but he had to cancel that meeting.
Another meeting has not yet been rescheduled. Staff will be
working with Mr. Fitch on some type of temporary arrangement
to maintain his drive-through ability.
Ms. Dacy stated staff is proceeding with the appraisal on the
Dairy Queen to acquire that piece of property so that they can
convey the necessary road easements back to the Anoka County
for the improvements. After the property is acquired, they
would then execute a lease agreement with Mr. Fitch to allow
him to continue to operate his business. All of these issues
would have to be approved by the HRA.
Mr. Commers asked what is the HRA's responsibility in terms
of the temporary road.
Ms. Dacy stated the road costs will not be part of the HRA's
costs. The HRA costs will be the landscaping and all the
improvements that were part of the University Avenue Corridor
project.
Mr. Burns stated the road costs are $20, 000, and it is the
City's responsibility.
9. STATUS OF PROPOSED FRIDLEY TOWN SQUARE DEVELOPMENT AGREEMENT:
Mr. Burns stated there are two parts to this discussion. The
first part is to include a Burger King drive-through as part
of this development. The second part has to do with Jim
Casserly's Equity Participation Agreement.
Ms. Dacy stated staff has scheduled a meeting with Scott
Erickson for Tuesday, December 18, 1990, to look at all the
potential impacts of this proposal. Mr. Erickson wants to
HOUSING & REDEVELOPMENT AUTHORITY MTG. , DEC. 13, 1990 PAGE 8
locate a Burger King at the west end of the building toward
University Avenue. This particular Burger King tenant is the
same owner that operates across University Avenue in the
southwest quadrant now. They want to have a drive-through
window at the rear of the building, and the traffic, as it
enters the site, would have to go to the rear-end of the site,
go around the rear of the building, customers would place
their orders at the west end of the building, pick up their
food, and then go all the way down to the Mississippi side and
exit that entrance.
Ms. Dacy stated staff has a number of concerns about the
Burger King drive-through. Staff has advised Mr. Erickson
that if he intends to pursue the drive-through, because it is
a substantial change to the originally approved development
plan by the Planning Commission, HRA, and Council, he will
have to back through the process. The surrounding property
owners would have to be renotified, a public hearing would be
conducted by the Planning Commission, the HRA would review the
new plan to see if it is consistent with its redevelopment
objectives, and the Council would review it in terms of their
rezoning decision.
Ms. Dacy stated that the HRA might have to consider this as
early as the January meeting. Staff is very concerned about
the traffic pattern because of the drive-through activity,
the noise from the speaker box to take customers' orders, and
the odors generated by the Burger King facility. The
neighbors were also very concerned about these things.
Mr. Commers stated he believed this proposed change would have
a significant impact on Mr. Casserly's Equity Participation
Agreement.
Mr. Prairie asked if the HRA has ever seen a financial
statement for the developer. He would be interested in
knowing the strength of the developer.
Mr. Burns stated staff can have a financial statement
available for the HRA at the January meeting.
Mr. Burns stated that because of the HRA's high level of
participation, which is around 10%, Mr. Casserly is
recommending the HRA should expect to benefit in any windfall
profit which the developer might make as a result of selling
this project in the future. In order to do that, Mr. Casserly
has developed an equity participation formula that is very
similar to formulas used for multi-family housing projects
that have been built in places like White Bear Lake, Shakopee,
Inver Grove Heights, North St. Paul, St. Paul, and
Minneapolis.
t. 1
HOUSING & REDEVELOPMENT AUTHORITY MTG. , DEC. 13, 1990 PAGE 9
Mr. Burns stated that in order to arrive at the end result,
which is the City's share in windfall profits, you first
multiply the net appreciation of the project by the ratio of
HRA equity participation to the developer's equity
participation. In this case, the HRA's equity participation
is $250, 000. The developer's equity participation is
$350, 000. That ratio is 71% based cn $250,000 to $350,000.
As a result of negotiations between Mr. Casserly and Mr.
Erickson, there is a minimum return to the HRA that is
specified as $100, 000 and a maximum return is specified as •
$250, 000. There is also an agreement that there will be no
sale of the project by the developer until two years after
the issuances of the certificate of occupancy. It is also
agreed that the project will be sold by the end of the seventh
year. If it is not sold by the end of the seventh year, then
the HRA will retrieve its money based on an appraisal of the
project at the end of the seventh year. So, again, the HRA's
return is based on the current appraisal.
Mr. Burns stated net appreciation is determined by looking at
the sale price and then subtracting from the sale price the
developer's investment, which is $350, 000, and the developer's
return on investment, which is anticipated at 15% per year.
Mr. Burns stated the idea is not necessarily that the HRA is
an equity partner that shares equally in the profit. Staff
realizes that the developer has taken much of the risk himself
and is in the business of developing and deserves a reasonable
cash on cash return. What the HRA is trying to ensure that
if there is a windfall profit above and beyond the reasonable
rate of return that the HRA participate in it, since the
original participation was higher than normal. There is no
sharing of any losses by the City. There is no participation
in any negative situations.
Mr. Commers stated that it seemed to him that at a minimum
any excess payments that the HRA is making over their normal
increment should come off first. The HRA has established a
guideline in terms of what they will contribute to a project,
and they have tried to enforce that guideline uniformly. If,
in this project, they are giving more than what they uniformly
give, then he thought at least that portion should come back
off before the developer gets all his profit and his return
on investment.
Mr. Commers stated that he wondered if the developer would be
willing to give the HRA's investment back without any return
on it; then take his return on investment and give the HRA
some lesser amount in the appreciation. That then puts the
HRA more in the position of a mortgage, because it gives the
HRA priority in the project before the developer.
I
HOUSING & REDEVELOPMENT AUTHORITY MTG. , DEC. 13, 1990 PAGE 10
•
Mr. Burns stated he will relay these comments and questions
to Mr. Casserly so they can be addressed at the next meeting.
This is strictly an informational item at this time.
Mr. Commers stated the HRA should see the proformas put
together for the shopping center. It would be interesting to
see what the developer expects the projected income for the
project to be 2-5 years from now.
Mr. Burns stated Mr. Casserly has that information, and they
•
will bring that to the January meeting.
10. OTHER BUSINESS:
Mr. Burns stated that Ms. Dacy and he have been trying
to
assess all the HRA's projects; and as they do that, to develop
their thoughts about the work program for the next few months.
s.
At the meeting, the HRA members had received a copy
of 1991 HRA workplan listing all the projects and some of the
steps they are anticipating taking at the staff level in the
near term future. This is for the HRA's review.
Ms. Dacy stated the workplan is divided into three parts:
Economic Development Activities the HRA has underway; Housing
issues, and Administration issues. She stated this workplan
ir
s
ranizeathetHRA'saagendaseandwtokmakeksuredtherefore,
,
that to
things
orgare
done on time.
ADJOURNMENT:
MOTION by Ms. Schnabel, seconded by Mr. Prairie, to adjourn the
meeting. Upon a voice vote, all voting aye, Chairperson Commers
declared the motion carried and the December 13, 1990, HRA meeting
adjourned at 9:25 p.m.gRes ctfully subm tt11ed,
yn 3 `:aba
Recording Secretary
w
ACTION ITEMS
r
r 0
1-7i
Community Development Department
f----N HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
TO: Housing and Redevelopment Authority Members 0•
PROM: William W. Burns, Executive Director of the HRA
DATE: January 2, 1991
SUBJECT: RMS Agreement
I am happy to forward to you the agreement with RMS that has been
prepared by Jim Casserly. In essence, the agreement provides that
the City of Fridley will reimburse RMS for one-half of the special
assessments that were due on their property as of December 15,
1990. Rick Pribyl and I estimate that the current value of the
outstanding assessments is in the neighborhood of $91,000.
Reimbursement will not occur until RMS has received a certificate
of completion of their approximately 75,000 square foot building.
The attached materials will provide additional details.
I have reviewed the agreement with Jim Casserly, Virgil Herrick,
and Rick Pribyl, and they concur with the agreement as it is
written. In view of their agreement, and in view of the
contribution of the RMS project to the Fridley economy, I recommend
the agreement for your approval.
WWB:rsc
Attachments
RMS PROPOSAL
1 . HRA will consider $50,000 payment to RMS
Corporation to be used to cover 50% of the
cost of storm sewer improvements to proposed
RMS building site.
2. Agreement to be considered at January 10, 1991 ,
HRA meeting.
3 . Assessments are for Projects 88-4, 89-1 , and
89-2, for street widening, resurfacing, and
storm sewer.
4. RMS Corporation:
a. Is the manufacturer of parts for the aircraft
industry and large companies requiring precision
metal parts.
b. Currently employs 248 people.
c. At different locations: Baker Street, Osborne
Road, and 81st Avenue.
d. Also has recently leased 2,500 square feet at
Martens/Brenny building on 83rd Avenue.
e. Plans the purchase of 8.9 acres at northwest
corner of Osborne Road and Main Street.
f. Plans construction of 70,000 to 80,000 square
foot building.
g. Estimated Cost: $4,000,000 to $5,000,000.
h. Taxes based on $2.75/sq. ft. = $206,225
per year. Local = $3 3 ,000 per year.
i. Will employ 15-75 people; possibly as many as
140-150 jobs.
j . RMS a privately-held subsidiary of Cretex
Corporation of St. Cloud.
k. Another division of Cretex is expected to move
into the 12,000 sq. ft. facility on Osborne Road.
5. Justifications:
a. The project is consistent with the objectives of
the HRA's redevelopment plan for subject area.
b. Assistance will enablethe City to retain 250
jobs.
c. The proposed project will add 50-75 new jobs.
d. Property tax benefit ($33,000 per year) is
supposed to cover cost within two years.
e. The proposed level of assistance is about 1-2%
of the total construction value.
. 15
,
1 ..�....
-
.. I. , 1 -1. :,
1 II: 76—N
. s, i. s 3
at
4111414,1250
% bift W me 1St , . IN III•.ir
V:its .1.
am- 0 i ? I % 66,. d id • ft
es,t /w p41.
` e0libi[AC$ LAMt
ilk •
V 9
11 ! ~ / ea
B
I II
.• T
if Ir ` I
ime— , =ll• '� l'1
It1 5 Z �Oe, a g ,
Nam. .... _ •
��` de0+ � ea lC aev NIL
z
s
ili VC/
1 d o1
1ila
p .j s .
1 7.4 g i
1 A N ~ .1.1
CS
1 $
i a7. • . o
1 .E. 2 ....."
E1‘
00% tii . • i
ell
� 1
• O� an
• 44, 41 , NR :
ogo .0
. . .0
ism
. ri, vil Imp I)
7 iimmi
.0".4....
lig,„
4 111011/4. %\Ili ° . ..
cn - - 1116
0 Q
.J
Casserly Molzahn & Associates, Inc.
215 South 11th Street, Suite 200 • Minneapolis • Minnesota 55403
Office(612)342-2277 • Fax(612)332-4765
MEMORANDUM
TO: Cy of Fridley
illiam Burns, City Manager
RMS Company
Dennis Forcelle, President
G •
FROM: James R. Casserly 4.
DATE: December 20, 1990
RE: Contract for Private Redevelopment
Enclosed you will find a copy of the Contract for Private
Redevelopment with the appropriate Schedules and accompanying
Resolution. The Authority uses a form of this Contract for any
project for which it is providing its funds. You will note a
number of references to public purposes. This is necessary so
the Authority has the ability to use its funds.
Essentially what the Contract purports to do is reimburse RMS for
one half of the special assessments owing as of December 15,
1990 . This reimbursement may be made to either the City to
directly reduce the outstanding special assessments or to RMS if
they have paid the specials prior to the distribution of the
funds. The payment will only take place when the building is
completed and has a minimum valuation of at least $3, 000, 000 .
The building must be completed prior to June 1 , 1992 in order for
the payments to be made.
We have made every effort to keep this Contract as simple as
possible and yet give effect to the intentions of the parties
within the parameters of the law.
Please contact me if there are any questions, suggestions or
changes.
JRC/db
encls
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE
CITY OF FRIDLEY
COUNTY OF ANOKA
STATE OF MINNESOTA
RESOLUTION NO.
A RESOLUTION AUTHORIZING EXECUTION AND DELIVERY OF A CONTRACT
FOR PRIVATE REDEVELOPMENT BY AND BETWEEN THE HOUSING AND
REDEVELOPMENT AUTHORITY IN AND FOR THE CITY FRIDLEY AND RMS
COMPANY.
BE IT RESOLVED by the Board of Commissioners (the
"Commissioners") of the Housing and Redevelopment Authority in
and for the City of Fridley, Minnesota (the "Authority" ) as
follows:
Section 1 . Recitals.
1 .01 . It has been proposed that the Authority enter into
a Contract For Private Redevelopment (the "Contract") with RMS
Company (the "Redeveloper" ) .
Section 2. Findinas.
2 .01 . The Authority hereby finds that it has approved
and adopted a development program known as the Modified
Redevelopment Plan for its Redevelopment Project No. 1 (the
"Redevelopment Program")pursuant to Minnesota Statutes, Section
469.001 et seq.
2.02 . The Authority hereby finds that the Contract
promotes the objectives as outlined in its Redevelopment Program.
Section 3 . Authorization for Execution and Delivery.
3. 01 . The Chairman and the Executive Director of the
Authority are hereby authorized to execute and deliver the
Contract when the following condition is met:
Substantial conformance of a Contract to the
Contract presented to the Authority as of
this date.
1
Adopted by the Board of Commissioners of the Authority this
day of 19_
Chairman
ATTEST:
Executive Director
2
Draft: December 20, 1990
CONTRACT
FOR
PRIVATE REDEVELOPMENT
By and Between
THE HOUSING AND REDEVELOPMENT AUTHORITY
In and For
THE CITY OF FRIDLEY, MINNESOTA
And
RMS COMPANY
This document was drafted by:
Casserly Law Office, P.A.
215 South 11th Street
Minneapolis, Minnesota 55403
•
TABLE OF CONTENTS
Page
ARTICLE I
Definitions
Section 1 . 1 Definitions 3
ARTICLE II
Representations and Warranties
Section 2 . 1 Representations by the Authority 5
Section 2. 2 Representations and Warranties by the
Redeveloper 5
ARTICLE III
Undertakings of Authority and Redeveloper
Section 3. 1 Payment of Public Improvement Costs 7
ARTICLE IV
Construction of Minimum Improvements
Section 4. 1 Construction of Minimum Improvements 8
Section 4.2 Completion of Construction 8
Section 4. 3 Certificate of Completion 8
ARTICLE V
Additional Provisions
Section 5. 1 Conflict of Interests 10
Section 5. 2 Restrictions on Use 10
Section 5. 3 Titles of Articles and Sections 10
Section 5. 4 Notices and Demands 10
Section 5. 5 Counterparts 10
SIGNATURES 11
SCHEDULE A Description of Redevelopment Property 14
SCHEDULE B Public Improvement Costs 16
SCHEDULE C Certificate of Completion 17
CONTRACT FOR PRIVATE REDEVELOPMENT
THIS AGREEMENT, made on or as of the day of
, 19 by and between the Housing and Redevelopment
Authority in and for the City of Fridley, Minnesota (the
"Authority") , a political subdivision of the State of Minnesota
organized under the Constitution and laws of the State of
Minnesota and RMS Company, a Minnesota corporation (the
"Redeveloper") ,
WITNESSETH:
WHEREAS, the Board of Commissioners (the "Board") of the
Authority has determined that there is a need for development and
redevelopment within the corporate limits of the City to provide
employment opportunities, to provide adequate housing in the
City, including low and moderate income housing and housing for
the elderly, to improve the tax base and to improve the general
economy of the City and the State of Minnesota;
WHEREAS, in furtherance of these objectives, the Authority
has established, pursuant to Minnesota Statutes, Sections 469 . 001
et seq. (the "Economic Development Act" ) , the development program
known as the Modified Redevelopment Plan for its Redevelopment
Project No. 1 (which program, as amended, and as it may be
amended, is hereinafter referred to as the "Redevelopment
Program") in the City to encourage and provide maximum
opportunity for private development and redevelopment of certain
property in the City which is not now in its highest and best
use;
WHEREAS, major objectives in establishing the Redevelopment
Program are to:
1 . Promote and secure the prompt redevelopment of certain
property in the Redevelopment Program, which property is not now
in its highest and best use in a manner consistent with the
City' s Comprehensive Plan and with a minimum adverse impact on
the environment, and thereby promote and secure the redevelopment
of other land in the City.
2. Maintain the employment of 248 people with the
opportunity of employing an additional 50 to 75 people within the
Redevelopment Program and the City for residents of the City and
the surrounding area, thereby improving living standards,
reducing unemployment and the loss of skilled and unskilled labor
and other human resources in the City.
1
3. Secure the increase of commercial property subject to
taxation by the City, the Independent School District, Anoka
County, and the other taxing jurisdictions in order to better
enable such entities to pay for governmental services and
programs required to be provided by them.
4. Provide for the financing and construction for public
improvements in and adjacent to the Redevelopment Program
necessary for the orderly and beneficial redevelopment of the
Redevelopment Program and adjacent areas of the City.
5 . Promote the concentration of new desirable industrial,
office, and other appropriate redevelopment in the Redevelopment
Program so as to maintain the area in a manner compatible with
its accessibility and prominence in the City.
6. Encourage local business expansion, improvement, and
redevelopment, whenever possible.
7. Create a desirable and unique character within the
Redevelopment Program through quality land use alternatives and
design quality in new or remodeled buildings.
8. Encourage and provide maximum opportunity for private
redevelopment of existing areas and structures which are
compatible with the Redevelopment Program; and
WHEREAS, in order to achieve the objectives of the Authority
and City in creating the Redevelopment Program the Authority is
prepared assist with the Public Improvement Costs; and
WHEREAS, the Authority believes that the development and
redevelopment of the Redevelopment Program pursuant to this
Agreement, and fulfillment generally of the terms of this
Agreement, are in the vital and best interests of the Authority
and the health, safety, morals and welfare of its residents, and
in accord with the public purposes and provisions of applicable
federal, state and local laws under which the development and
redevelopment are being undertaken and assisted;
NOW, THEREFORE, in consideration of the premises and the
mutual obligations of the parties hereto, each of them does
hereby covenant and agree with the other as follows:
2
ARTICLE I
Definitions
Section 1 . 1 Definitions. In this Agreement, unless a
different meaning clearly appears from the context:
"Act" means Minnesota Statutes, Section 469 . 001 et seq.
"Agreement" means this Agreement, as the same may be from
time to time modified, amended, or supplemented.
"Authority" means the Housing and Redevelopment Authority in
and for the City of Fridley, Minnesota.
"Certificate of Completion" means the certification, in the
form of the certificate contained in Schedule C attached to and
made a part of this Agreement, provided to the Redeveloper,
pursuant to Section 4.3 of this Agreement.
"City" means the City of Fridley, Minnesota.
"Construction Plans" means the plans, specifications,
drawings and related documents on the construction work to be
performed by the Redeveloper on the Redevelopment Property which
the City requests prior to the issuance of its building permit.
"Council" means the Council of the City.
"County" means the County of Anoka, Minnesota.
"Minimum Improvements" means the interior and exterior
improvements to the Development Property, including landscaping,
parking and related facilities, to be constructed by the
Redeveloper upon the Development Property pursuant to this
Agreement, as such improvements are defined in the Construction
Plans therefore and which Minimum Improvements shall consist of a
75, 000 square foot office and manufacturing facility which shall
have a minimum market value upon completion of $3, 000, 000.
"Minnesota Environmental Policy Act" means the statutes
located at Minnesota Statutes, Sections 116D.01 et seq. , as
amended.
"Minnesota Environmental Rights Act" means the statutes
located at Minnesota Statutes, Sections 116B. 01 et seq. , as
amended.
"National Environmental Policy Act" means the federal law
located at 42 U.S.C. Sub. Sect. 4331 et seq. , as amended.
3
"Public Improvement Costs" means those costs described on
Schedule B attached to this Agreement. The Public Improvement
Costs represent the balances owing on special assessments levied
by the City as of December 15, 1990.
"Redeveloper" means RMS Company, a Minnesota corporation.
"Redevelopment Program" means the modified redevelopment
program adopted by the Authority for its Redevelopment Project
No. 1 , as amended.
"Redevelopment Property" means the real property described
in Schedule A of this Agreement.
"State" means the State of Minnesota.
"Unavoidable Delays" means delays which are the direct
result of strikes, delays which are the direct result of
unforeseeable and unavoidable casualties to the Minimum
Improvements, the Redevelopment Property or the equipment used to
construct the Minimum Improvements, delays which are the direct
result of governmental actions, delays which are the direct
result of judicial action commenced by third parties, citizen
opposition or action affecting this Agreement or adverse weather
conditions or acts of God.
4
ARTICLE II
Representations and Warranties
Section 2. 1 Representations hy the Authority. The Authority
makes the following representations as the basis for the
undertaking on its part herein contained:
(a) The Authority is a public body duly organized and
existing under the laws of the State. Under the provisions of
the Act, the Authority has the power to enter into this Agreement
and carry out its obligations hereunder.
(b) The Authority has approved the Redevelopment Program in
accordance with the terms of the Act.
(c) The Authority proposes to pay for certain public
improvements in accordance with the Redevelopment Program.
(d) The Authority will cooperate with the Redeveloper with
respect to any litigation commenced by third parties in
connection with this Agreement.
Section 2. 2 Representations and Warranties hi the
Redeveloper. The Redeveloper represents and warrants that:
(a) The Redeveloper will construct, operate and maintain
the Minimum Improvements in accordance with the terms of this
Agreement, the Redevelopment Program and the Tax Increment Plan
and all local, state and federal laws and regulations (including,
but not limited to, environmental, zoning, building code and
public health laws and regulations) .
(b) At the time the Certificate of Completion is issued, the
Minimum Improvements shall have a market valuation for the
computation of ad valorem property tax of not less than $3, 000, 000 .
(c) The Minimum Improvements, as of the date of transfer of
the Redevelopment Property, will be an allowed use under the
zoning ordinance of the City.
(d) As of the date of execution of this Agreement, the
Redeveloper has received no notice or communication from any
local, state or federal official that the activities of the
Redeveloper or the Authority in the Redevelopment Program may be
or will be in violation of any environmental law or regulation.
As of the date of execution of this Agreement, the Redeveloper is
aware of no facts, the existence of which would cause it to be in
violation of any local, state or federal environmental law,
regulation or review procedure or which would give any person a
valid claim under the Minnesota Environmental Rights Act.
5
(e) The Redeveloper will use its best efforts to obtain, in
a timely manner, all required permits, licenses and approvals,
and will meet, in a timely manner, all requirements of all
applicable local, state and federal laws and regulations which
must be obtained or met before the Minimum Improvements may be
lawfully constructed.
(f) The Redeveloper is a corporation, organized and
existing under the laws of the State of Minnesota.
(g) Except for any negligent, willful or wanton misconduct
of the City, the Authority their respective members, officers,
agents and employees the Redeveloper agrees that it will
cooperate with the Authority and shall indemnify the Authority
and the City against all costs, including the costs of defense
incurred by the Authority through an attorney of its choosing,
with respect to any litigation commenced by third parties in
connection with this Agreement.
6 •
ARTICLE III
Undertakings of Authority and Redeveloper
Section 3 . 1 Payment of Public Improvement Costs. Upon the
issuance of the Certificate of Completion in accordance with
Section 4.3 of the Agreement, the Authority shall pay one half of
the Public Improvement Costs. If the Redeveloper has paid the
Public Improvement Costs prior to the issuance of the Certificate
of Completion, then the Authority shall reimburse the Redeveloper
one half of the Public Improvement Costs. If the Redeveloper has
not paid the Public Improvement Costs, then the Authority shall
pay the City one half of the Public Improvement Costs to reduce
any outstanding special assessments that are part of the Public
Improvement Costs against the Redevelopment Property. As a
result of prepayments, if the outstanding balance of the special
assessments is less than one half of the Public Improvement
Costs, then the difference shall be paid to the Redeveloper.
7
ARTICLE IV
Construction Qf Minimum Improvements
Section 4. 1 Construction of Minimum Improvements. The
Redeveloper agrees that it will construct the Minimum Improvements
on the Redevelopment Property in accordance with the approved
Construction Plans.
Section 4.2 Completion of Construction. Subject to
Unavoidable Delays, the Redeveloper shall achieve substantial
completion of the construction of the Minimum Improvements by June
1 , 1992. All work with respect to the Minimum Improvements to be
constructed or provided by the Redeveloper on the Redevelopment
Property shall be in conformity with the Construction Plans as
submitted by the Redeveloper and approved by the City.
The Redeveloper agrees for itself, its successors and assigns,
and every successor in interest to the Redevelopment Property, or
any part thereof, that the Redeveloper, and such successors and
assigns, shall diligently prosecute to completion the development
of the Redevelopment Property through the construction of the
Minimum Improvements thereon, and that such construction shall in
any event be completed within the period specified in this Section
4. 3 of this Agreement subject to Unavoidable Delays.
Section 4.3 Certificate of Completion.
(a) Promptly after substantial completion of the Minimum
Improvements in accordance with those provisions of the Agreement
relating to the obligations of the Redeveloper to construct the
Minimum Improvements (including the date for completion thereof) ,
the Authority will furnish the Redeveloper with an appropriate
instrument so certifying. Such certification by the Authority
shall be (and it shall be so provided in the certification itself)
a conclusive determination of satisfaction and termination of the
agreements and covenants in the Agreement with respect to the
obligations of the Redeveloper, and its successors and assigns, to
construct the Minimum Improvements and the date for the completion
thereof.
(b) If the Authority shall refuse or fail to provide any
certification in accordance with the provisions of this Section 4 . 4
of this Agreement, the City shall, within ten (10) days after
written request by the Redeveloper, provide the Redeveloper with a
written statement, indicating in adequate detail in what respects
the Redeveloper has failed to complete the Minimum Improvements in
accordance with the provisions of the Agreement, or is otherwise in
default, and what measures or acts it will be necessary, in the
opinion of the Authority, for the Redeveloper to take or perform in
order to obtain such certification.
8
(c) The construction of the Minimum Improvements shall be
deemed to be substantially completed when the Redeveloper has
received an occupancy permit from the City' s building inspector,
which permit shall not be unreasonably withheld.
9
ARTICLE V
Additional Provisions
Section 5. 1 Conflict of Interests. No member, official, or
employee of the Authority shall have any personal interest,
direct or indirect, in the Agreement, nor shall any such member,
official or employee participate in any decision relating to the
Agreement which affects his personal interests or the interests
of any corporation, partnership, or association in which he is,
directly or indirectly, interested.
Section 5.2 Restrictions on Use. The Redeveloper shall not
discriminate upon the basis of race, color, creed, sex or
national origin in the sale, lease, or rental or in the use or
occupancy of the Redevelopment Property or any improvements
erected or to be erected thereon, or any part thereof.
Section 5 . 3 Titles of Articles and Sections. Any titles of
the several parts, Articles and Sections of the Agreement are
inserted for convenience of reference only and shall be
disregarded in construing or interpreting any of its provisions.
Section 5 . 4 Notices and Demands. Except as otherwise
expressly provided in this Agreement, a notice, demand, or other
communication under the Agreement by either party to the other
shall be sufficiently given or delivered if it is dispatched by
registered or certified mail, postage prepaid, return receipt
requested, or delivered personally; and
(a) in the case of the Redeveloper, is addressed to or
delivered personally to the mailing or delivery address the
Redeveloper will, from time to time, furnish to the Authority;
and
(b) . in the case of the Authority, is addressed to or
delivered personally to the Housing and Redevelopment in and for
the City of Fridley, Minnesota, or at such other address as the
City may, from time to time, designate in writing and forward to
the Redeveloper.
Section 5. 5 Counterparts. This Agreement is executed in any
number of counterparts, each of which shall constitute one and
the same instrument.
10
IN WITNESS WHEREOF, the Authority has caused this Agreement
to be duly executed in its name and behalf and the Redeveloper
has caused this Agreement to be duly executed on or as of the
date first above written.
By
Its Chairman
And by
Its Executive Director
By
Its
By
Its
11
STATE OF MINNESOTA )
)ss
COUNTY OF ANOKA )
On this day of , 19 before me, a
notary public within and for Anoka County, personally appeared
and to me personally known who by
me duly sworn, did say that they are the Chairman and Executive
Director of the Housing and Redevelopment Authority in and for
the City of Fridley, Minnesota, a political subdivision of the
State of Minnesota, and acknowledged the foregoing instrument on
behalf of said Authority.
Notary Public
12 •
STATE OF MINNESOTA )
)ss
COUNTY OF ANOKA )
On this day of , 19 before me, a
notary public within and for
and personally appeared
the and
, respectively, of RMS Company, a Minnesota
corporation, and acknowledge the foregoing instrument on behalf
of said corporation.
Notary Public
13
SCHEDULE A
DESCRIPTION OF REDEVELOPMENT PROPERTY
Lot 5, Revised Auditor' s Subdivision No. 77, Anoka County,
Minnesota, EXCEPTING THEREFROM the two following described
. parcels:
1. All that part of Lot 5, Revised Auditor' s Subdivision No.
77, described as follows: Commencing at the intersection of
the centerline of Osborne Road a.$ now laid out with the
Easterly right-of-way line of Northerrri •Pacific Railroad, said
point._being :1320._57i7feet7Southerly-as measured -along said -
Easterly..right=of-way 1-ine'from the North line of Section 10,
Township 30, Range 24; thence Northeasterly along said
centerline of. Osborne Road a •distance of 436. 50 feet ; thence
deflecting to the left 66 degrees, 43 minutes, 20 seconds, a
distance -of 436. 50 feet ; thence Southwesterly parallel with
the centerline -of- said Osborne Road to-the Easterly
right-of.-way line of Northern-.Pee i f ic Railroad.; -thence
SoutherAy:. •long :.said :Easterly -right-of-way -1 irit tolthe point .
of beginning.
2. That part of Lot 5, Revised Auditor' s Subdivision No. 77,
Anoka County, Minnesota, described as follows:
Commencing at the . intersection of the center line of Osborne
Road, as now laid out, with the Easterly right-of-way line of
Northern Pacific Railroad; thence northeasterly along said
center 1 ine .of _fisborne•_Road, _43G.50 feet, said center 1 ine .has
an assumed bearing of -i4orth:r51 '-degrees; • 03.minutes, 20 seconds
East ; thence North 15 degrees, 40 .minutes, 00 seconds West, la
distance of-436. 5 'feet -to-the point • of ibeg'inning+ '-.thence South
51 degrees, 03 :minutes, .20 .seconds•.West, arallel ;,with .the.. �.;,.;. _
. center,.line .of•. afd _asbo e.:�Road�:�436. f et' '.tst'�t�ie-Eas�erly. �:.::
right-cf-way -1-it,e ;id f+safdatsIQrttiernr,Rac•if fiiRai i^oad :thence - .
_1`!or_therly,''along sand _
ast_-er�i:" ight=of-i . :_ t__. .__•_ -.. _
*intersection of.-=t he north �l the said=tot 5 tTi en allorth_8.9__
degrees, -57 minutes, 31 .seconds•East;:-along :said -north :1ine, t ,
425. 48 feet to its intersection with a line bearing North 18
degrees, 05 minutes, 56 seconds West from the point of
beginning; thence South 18 degrees, 05 minutes, 56 seconds
East, a distance of 596. 44 feet to the point of beginning. .
r
14
ALSO:
That part of the Northwest Quarter of the Northwest Quarter •of
Section 11, Township 30, Range 24, Anoka County, Minnesota,
described as follows: Commencing at the intersection of the
northwesterly right of way line of Osborne Road, as the same
is now laid out and traveled, and the west line of said
Section 11 ; thence North 51 - degrees, 03- minutes, 20 seconds
East, along said right of way line, said bearing is assumed,
364. 27. •feet ; -thence-on-a.tangent.ial •.curve- to-the left, having a
radius.-of:-20 feet,r e, tra•l.tar 41.e..Qi .81:=degr.._r?e;'•.".3• m-i-nutes,-=54 ;-
seconds; _ -W Ce'_ f;z28:4Tsfeetlt h . .=degrees 20"
minutes, 34 seconds •West,-tangent -to last described curve,
37. 66 feet ; thence on=a. tangent.ial curve to the left, - having a
radius of 661. 50 feet, central angle of 16 degrees, 01 minute,
01 second, a distance .of 184. 92 .feet ; thence North .46 degrees, -
21 minutes, .35 .seconds West ' tangent to. last described curve,
168. 36 feet ; thence•on•.a. tangential--curve tothe right, -having -
a radius of .254. 52•-fee.t,• central._angle. of 45 degrees,
minutes, 55 seconds,.. a.-distance -of 201. 37 feet ; .thence. North_ 1 _
degree, 01 minute(•40 -seconds West, tangent to last _described
curve, -to the North -Line .of Lot 5, Revised Auditor' s
Subdivision No. . 777; . .._ .
thence easterly, along said north line, 33 feet to the
northwest corner of said Section 11 and the actual point of
beginning; thence South 1 degree, 01 minute, 40 seconds East a
distance of 53. 14 feet ; thence on a tangential curve to the
left, having a radius of 221. 52 feet, a distance of 175. 26
feet ; thence South 46 degrees, 21 minutes, 735_seconds_ East .. . _
tangent to-last described -curve, 168. 36=•feeti'.'thence
tangential curve to the right, having a radius -of. 694. 50 feet, :a
distance of =194. 15 feet ; thence .South •30 degrees,': 20=minutes;•
34 seconds .East, tangent. to last .described. curve, -83..24 Ieet
. to the center:l ine •of_said -Dsbor ecRoad;.;thence,.al-bnb tfi ,t,"
center.l.ine :of. Osborne Road ?:to ,the Westanl ,i.2i0 ,nf= ?d �=�,.:
Sect ios ! 11 ;• thence-Northerly--,along !the Lest rl ne�o ==771.
Section 11-•to:the actual -point of-beginning: and=7there; _'=_ --_ _ "
terminating.- - - �
15
SCHEDULE B
PUBLIC IMPROVEMENT COSTS
Water/Sewer: Laterals $ 555 .36
112.88
Subtotal $ 668.24
Storm Sewer: Mains, Laterals $ 1 , 008.79
1 , 647 .07
39, 079. 10
481 . 16
785 . 56
13, 026.37
Subtotal $56, 028.05
Streets: Surfacing, Curb/Gutter, Sidewalk $ 2, 003.80
4, 356. 11
2, 125 . 74
9, 070 . 87
2,937 . 25
12, 534 . 30
Subtotal $33, 028. 07
Total $89, 724. 36
16
SCHEDULE C
CERTIFICATE OF COMPLETION
WHEREAS, the Housing and Redevelopment Authority in and for
the City of Fridley, Minnesota, a Minnesota municipal corporation
(the "Authority") and RMS Company, a Minnesota corporation (the
"Redeveloper") have entered into a Contract for Private
Redevelopment (the "Agreement") dated , 19_,
regarding certain real property referred to in the Agreement as
the "Redevelopment Property" located in Redevelopment Project No.
1 in the City; and
WHEREAS, the Agreement contains certain conditions and
provisions requiring the Redeveloper to construct improvements
upon the Redevelopment Property (hereinafter referred to and
referred to in the Agreement as the "Minimum Improvements") ; and
WHEREAS, Section 4.3 of the Agreement requires the Authority
to provide an appropriate instrument promptly after the
substantial completion (as defined in the Agreement) of the
Minimum Improvements so certifying said substantial completion;
NOW, THEREFORE, in compliance with said Section 4.3 of the
Agreement, this is to certify that the Redeveloper has
substantially completed the Minimum Improvements in accordance
with the conditions and provisions of the Agreement relating
solely to the obligations of the Redeveloper to construct the
Minimum Improvements (including the date for completion thereof) ,
and this certification shall be a conclusive determination of
satisfaction and termination of the agreements and covenants in
the Agreement with respect to the obligations of the Redeveloper,
and its successors and assigns, to construct the Minimum
Improvements and the date for completion thereof.
Dated: , 19
17
1 ' 1
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
OF FRIDLEY, MINNESOTA
By
Its
By
Its •
STATE OF MINNESOTA )
)ss
COUNTY OF ANOKA )
On this day of , 19 before me, a
notary public within and for Anoka County, personally appeared
and to me personally known who by
me duly sworn, did say that they are the Chairman and Executive
Director of the Housing and Redevelopment Authority in and for
the City of Fridley, Minnesota, a political subdivision of the
State of Minnesota, and acknowledged -the foregoing instrument on
behalf of said Authority.
Notary Public
This instrument was drafted by:
Casserly Law Office, P.A.
215 South 11th Street
Minneapolis, Minnesota 55403
•
18
RESOLUTION NO. KRA - 1991
RESOLUTION DESIGNATTAV OFFICIAL DEPOSITORIES FOR
THE FRIDLEY EDUSIAV AND REDEVELOPMENT AUTHORITY
IT IS HEREBY RESOLVED that the Fridley State Bank is hereby designated as a
depository for the funds of this corporation.
IT IS FUG RESOLVED that checks, drafts or other withdrawal orders issued
against the funds of this corporation on deposit with said bank shall be signed
by two of the following:
Richard D. Pribyl, Finance Directo
William W. Burns, City Manager
David J. DuBord, Assistant Finance Director
and that said bank is hereby fully authorized to pay and charge to the account
of this corporation any checks, drafts, or other withdrawal orders.
BE IT FURTHER RESOLVED that all transactions, if any, relating to deposits,
withdrawals, re-discounts and borrowings by or on behalf of this corporation with
said bank prior to the adoption of this resolution be, and the same hereby are,
in all things ratified, approved and confirmed.
BE IT FURTHER RESOLVED that any bank or savings and loan may be used as
depositories for investment purpoecz so long as the investments comply with
authorized investments as set forth in Minnesota Statutes.
BE IT FURTHER RESOLVED that the signatures of two of the following named City
employees are required for withdrawal of BRA investment funds from savings and
loan associations:
Richard D. Pribyl, Finance Director-Treasurer
William W. Burns, City Manager
David J. DuBord, Assistant Finance Director
BE IT FURTHER RESOLVED that any brokerage firm may be used as a depository for
investment purpose so long as the investments comply with the authorized
investments as set forth in Minnesota Statutes.
PASSED AND ADOYiED BY THE HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF
FRIDLEY THIS DAY OF , 1991.
LAWRENCE R. COMMERS, CHAIRMAN
ATTEST:
WILLIAM W. BURNS
EXECUTIVE DIRECTOR
DATE 01/04/91 CITY OF FRIDLEY - HFA
PAGE 1
PROGRA" PODS ' CHECK REGISTER
CHECK RUN Pr TCH a :0012 002 HRA
VENDOR DISC. JOB
DESCRIPTION INV 4 PO/INV 4 SEQ $ PCNT AMOUNT ACCT NUMBER NMBR MESSAGES
2090 **** C:HECI:—PREPAID t+++
800176 BRIGGS AND MORGAN PROF. ASSOC.
LEGAL SERV/DISB4JRSMENTS—L 00384-01 IPZI4A0.0000 542.70 DR460-20200
ACCOUNTS PAYABLE
542.70 CR460-10100 CASH
++++ TOTAL VENDOR ****
$ 542.70
2091 +++t CHECK—PREPAID ****
C00044 CASSERLY LAW OFFICE
DECEMBER LEGAL SERVICES 00385-01 IPZI2N0.0000 794.50 DP450-20200
ACMCRrT'3 PAYABLE
794.50 CR450-10100 CASH
DECEMBER LEGAL SERVICES 00385-02 1PZI3WO.00000 22.50 DR452-20200
ACCOUNTS PAYABLE
22.50 CR452-10100 CASH
DECEMBER LEGAL SERVICES
00385-03 IPZI410.0000 700.50 DR455-20200 ACCOUNTS PAYABLE
700.50 CR455-10100 CASH
DECEMBER LEGAL SERVICE 00355-44 1PZI4D0.0000 848.00 DR460-20200 ACCOUNTS PAYABLE
848.00 CR460-10100 CASH
**** TOTAL VENDOR ****
$ 2,365.50
2092 t*tt CHECK—PREPAID ****
FC5i072 FIRST TRUST
BOND PAYMENT GO SER 90 0 386-01 1PZI2H0.0000 324,565.00 DR3 3-20200
ACCOUNTS PAYABLE
tttt TOTAL VENDOR **** 324,565.00 CR3S3-10100 CASH
$ 324,565.00
2093 **** CHECK—PREPAID t***
H00019 HEFRICK & NEWMAN
DECEMBER LEGAL SERVICES 00387-02 1PZI450.0000
150.00 [R455-20200 ACCOUNTS F'AYhBLE
DECEMBER LEGAL SERVICES150.00 CR455-10100 CASH
00387-01 1PZI4H0.0000 330.00 DR460-20200 ACCOUNTS PAYABLE
330.00 CR460-10100 CASH
t+tt TOTAL VENDOR **** $ 480.00
**** TOTAL NUMBER OF CHECKS I,RITTEN : 000000 **** TOTAL DOLLARS FOR CHECKS WRITTEN : $ 327,953.20 t*** LAST CHECK NUMBER : 00208c
INFORMATION ITEMS
Community Development Department
FA HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: January 3, 1991
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Proposed Request for HRA Assistance from First
Western Development Corporation
I met with Mike Spriggs, Vice President of First Western
Development Corporation, on Tuesday, December 18, 1990 regarding
a potential application for soil correction assistance on the site
at the southwest corner of 85th and University Avenues. This
parcel is part of area #3 of the redevelopment plan which was
established as a result of very poor soil conditions in the area.
I gave the developer the HRA's new application forms for TIF
assistance. The developer did not indicate the amount of the
assistance requested since his engineering consultant (Westwood
Engineering) was still in the process of completing the site
analysis. Attached is a preliminary memo from Westwood Engineering
regarding the earthwork and storm sewer requirements necessary on
the site. It identifies a total estimated grading cost of slightly
less than $1, 000, 000. The amount and cost of removing the poor
soil from the site and the amount of fill to replace it to the
existing elevation still needs to be determined.
The developers are proposing to construct a shopping center
totalling 126, 500 square feet, a 113,000 square foot Target store,
and two restaurant sites totalling 16, 100 square feet. The site
now contains about 5 acres of wetland area. As a requirement of
the Army Corp permit which the developer has received, the
developer has to provide an off-site mitigation project to account
for the destruction of lost wetlands. The off-site mitigation
project is located at Meadowlands Park north of Mississippi Street
and south and east of 68th Avenue and Kennaston Drive.
Also necessary at the 85th Avenue site will be the construction of
the remaining link of the frontage road along the west side of
University Avenue. This also may mean installation of traffic
signals at 83rd and University Avenues. The HRA should be aware
that staff will be researching the possibility of adding the
typical intersection improvements recommended in the University
Avenue Corridor study at 83rd and 85th Avenues.
No action is needed on these issues at this time. The HRA may
consider the application at the February or March meetings.
M-90-920
11 ...--- \
0- ( \ (- 4f. '
, \
P7Th er
k, _ __ ___ HENT3
L.
lg,_ . � t
1 . . 0, l\ % L!LL
Rr 0 0
d NS
1 .1
B
h I, .p s
!IV I 41
_ M i V U
I . — ----,_ _-_2 0_.a_ ___0 c-14
t 1W; t rt pi._ ,,
x.
c=:„ o
•
f' D 1
t
‘7.
•
S riii
iiir
L tA 4
/1 f.
J
J
r '
MEMORANDUM1 .
7[1:41125
December 4, 1990
To: Tim Erkkila, Westwood
From: Dwight Jelle, Westwood
Re: Northtown Plaza Earthwork and Storm Sewer Requirements
The above mentioned site contains several inhibiting factors with respect to
the overall mass grading and storm sewer design and function. We have
analyzed the soil requirements along with the storm water runoff requirements
and have prepared this memo as an outline of our findings.
MASS GRADING:
We refer you to the preliminary soil investigation of the subject site
prepared by Braun dated March 13, 1989. They refer to several grading
requirements including specific organic material removal, water table
management, and backfilling. Generally the site consists of an average "1/2
foot near the eastern portion of the site to 6 feet near the western portion"
(YMCA parcel) . For estimating earthwork requirements, we halassumed an
average depth of 4'-0" of highly compressible organic materialthat will have
to be completely removed under building and parking areas.
The report also refers to having building pad elevations at a level
approximately 4'-0" above the existing ground surface. We have not followed
this in all cases and believe that additional de-watering and subsurface drain
tiles will be required to keep the water table at a desirable level.
Attached to this memo is an estimate of the grading costs, not including de-
watering or other specialized cost items, that may be included with this
project. We have assumed that major costs involved will be the exportation of
organic materials and the importation of engineered fill to balance the site.
We feel that the site is at it's lowest possible elevations due to storm water
and ground water requirements.
STORM WATER RUNOFF
The storm water runoff requirements for this site involve the water quantitiy,
quality and existing drainage that passes through the site.
The city of Fridley restricts the allowable discharge of storm water runoff to
the pre-development 1-year, 24-hour storm event. This has been determined to
be approximately 11 .5 cubic feet per second (CFS) . The water must pass
through a storm water detention pond that is located in the northwest corner
of the property and discharge at a point near the existing inlet structure
adjacent to the residential development on the west.
The existing water elevations at the outlet location have been determined by
field crews to be approximately 864.00. We are required to hold building
elevations high enough to allow subsurface storm sewers to properly drain the
site to the northwest pond and back to the outlet location.
Northtown Plaza Earthwork and Storm Sewer Requirements
December 4, 1990
Page 2
Currently there is a ditch the bisects the property as noted on the grading
plan. This ditch carries approximately 190 CFS of storm water runoff from
University Avenue. Because we are piping this system through the site, we
have essentially formed a "Utility wall" with this piping system (we cannot
pass storm pipes from the Target store and employee lots through into the pond
system) . Because of the runoff quantity and additional quality restrictions,
we are proposing to pipe approximately 20 CFS from the University Avenue
runoff internally through the site to make up for the water that can not be
treated from the Target store.
Prior to construction, Mn/DOT will have to review and approve this concept.
SITE EARTHWORK ANALYSIS
Iwo "e0N***•-ttt0""7""p000OOM��0"OOt "10�OO000SW�000O01IStf\�a
DATE: 03-Dee-90 UNIT ESTIMATED
PROJECT: NORTHTOWN PLAZA - FRIDLEY COST COST
PROJECT NUMBER: 90560
DESIGNER: DWIGHT & BRIAN
NETN00 OF ANALYSIS: OCA
CALCULATIONS EXISTING TO PROPOSED? • YES
TOTAL SITE AREA TO BE GRADED: 29.6 ACRES
TOTAL HARD SURFACE AREA: 25.0 ACRES
GROSS CUT: 91680 CU.YD. $0.95 $87,096
AREA IN CUT: 14.8 ACRES
GROSS FILL: 69453 CU.YD.
AREA IN FILL: 14.8 ACRES
EXPANSION FACTOR FOR CUTS: 100.002
CQIPACTION FACTOR FOR FILLS: 130.002
AVERAGE TOPSOIL DEPTH: 4.00 FEET
TOPSOIL STRIPPING IN FILL AREAS 95509 CU.YD. $0.95 $90,734
TOPSOIL IN CUT AREA 95509
CLEAN MATERIAL EXCAVATED: (EXPANDED) -3829 CU.YD.
AREA TO BE INCLUDED FOR SUBGRADE EXCAVATION: 4 ACRES
DEPTH OF SUBGRADE EXCAVATION: 0.6667 FEET
SUBGRADE EXCAVATION: (EXPANDED) , 4302 CU.YD. $1.00 $4,302
DEPTH OF PAVEMENT/GRANULAR: 0.6667 FEET
VOLUME OF HOLD-OOWN MATERIAL: (EXPANDED) 26890 CU.YD.
TOPSOIL TO BE WASTED OFF SITE: (USED TO BALANCE) 120000 $2.00 $240,000
SUBTOTAL MATERIAL AVAILABLE (LV): 98382 CU.YO.
MATERIAL BACXFIULED: (USING COMPACTION FACTORS) 220044 CU.YO.
SUBSIDENCE FACTOR: 0.1 FEET
AREA TO BE INCLUDED IN SUBSIDENCE: 29.0 ACRE
VOLUME COMPACTED DUE TO SUBSIDENCE: 4679 CU.YD.
SUBTOTAL MATERIAL NEEDED (LV): 224723 QJ.YD.
EXCESS/<SMORTAGEi. OF MATERIAL: -126341 CU.YD. $4.50 $568,534
ADJUSTMENT REQUIRED TO BALANCE SITE: (RAISE/<LOWER>) -2.65 FEET
ESTIMATE OF "GO00" MATERIAL AVAILABLE: 27363 CU.YO.
ESTIMATE OF "000D" MATERIAL NEEDED: 189800 CU.YD.
EXCESS/4SHORTAGE> OF "G000" MATERIAL: -162436 CU.YD.
ADJL3TrENT REQUIRED TO BALANCE SITE: (RAISE/(LOWER)) -3.40 FEET
T3TA,. ESTIw►TED GRADING COST: $990.666
MEMORANDUM
Municipal Canter
6431 Univaraity Avanua N.E. Office of the City Manager
Fridley, MN 55432 William W. Burns
CITYOF (612) 571-3450
FRIDLEY
TO: The Honorable Mayor and City Council
FROM: William W. Burns, City Manage40.
DATE: January 2, 1991
SUBJECT: Fridley Town Square Project
As most of you are aware, Scott Erickson, the developer for the
Fridley Town Square project, has recently told us that he plans to
incorporate a Burger King on the north side of that project. Our
traffic consultant, Barton-Aschman, told us that a Burger King will
generate between 75 to 130 additional vehicle trips during the p.m.
peak hour into and out of the shopping center. Moreover, the
additional traffic will result in reducing the level of service of
the intersection from a Level D intersection to a Level E
intersection. This is true, of course, for the p.m. peak hour.
In addition to our concern for the traffic impact at the
intersection of Mississippi Street and the entrance into the
planned shopping development, we are also concerned about the
impact of the Burger King traffic behind the shopping development.
First, we are concerned about the conflict of this traffic with
vehicles that are loading and unloading at the Walgreen's store.
We are also concerned about vehicle noise, such as the noise that
comes from loud mufflers and noise from the speaker system
associated with the drive-thru. Additionally, we are concerned
with odors from Burger King that may affect the adjacent
neighborhood.
In view of staff concerns, we held a meeting with Scott Erickson,
Steve Billings and Mayor Nee before the Christmas holidays. During
our meeting, it was decided that we would have further discussions
with other council members on the evening of the Meadowlands
meeting which was held on Tuesday, December 18, 1990.
Additionally, I had telephone discussions with each of you
(December 19 and 20) . Although there is no unanimity in your
opinion, my interpretation of Council's feelings is that unless
there is a way to mitigate the impact of the additional traffic,
Council is not interested in approving Mr. Erickson's change in
plans.
Memo to Mayor and City Council
January 2, 1991
Page Two
After discussing the matter further with Barton-Aschman, it seems
apparent that there is only one way to mitigate the impact of the
traffic. That would occur by moving the point of ingress and
egress to the shopping center further east. This would mean buying
additional property. In talking with Scott Erickson about this
possibility, Mr. Erickson pointed out that Walgreen's will in all
likelihood not agree to move the driveway. In general, he is not
at all enthusiastic about this possibility, even if the HRA agrees
to purchase the additional property.
In view of the absence of any easy mitigation of the traffic
problem, I left Mr. Erickson with the general message that he
should be thinking very seriously about finding a substitute tenant
for Burger King. Mr. Erickson is adamant in not wanting to find
a susbstitute for Burger King. He said that he has scoured the
countryside high and low, and feels that it would be impossible to
find someone else. He also is not satisfied with accepting
rejection over the telephone, and has demanded that he be able to
invoke the process defined in the S-2 section of our zoning
ordinance. This process defines a way for Planning and Council
approval of significant changes in development plans for S-2
property.
After discussing this matter with Barbara Dacy and Virgil Herrick,
it seems that the following schedule of events is in order:
1. January 7, 1991: Informal review of the situation after
the Council meeting.
2. January 10. 1991: Informal review of the situation at
the HRA meeting.
3. January 23. 1991: Public hearing on the proposed change
before the Planning Commission.
4. February 11. 1990: City Council consideration of the
proposed change. (I believe that this does not require
a public hearing. )
Although I have tried carefully to determine individual Council
member's feelings about the Fridley Town Square project, I may or
may not be reflecting your opinions accurately. Hopefully, our
discussion on Monday, January 7, 1991, will serve to clearly
establish your direction on this issue.
Thank you for taking the time to review this matter.
WWB:rsc
18-Dec-90
RICE PLAZA 1990 RENT
AUG SEPT OCT NOV DEC
NORGE VILLAGE 1,100.00 1,100.00 1,152.00 1,113.56 1 M.1)
METZ BAKING 700.00 700.00 700.00 700.00 730.50
CHILDREN CHARM 675.00 675.00 797.15 872.52 869.75
HONG KONG KITCHEN 725.00 725.00 746.84 755.69 752.97
MY SISTER'S CLOSET 700.00 700.00 921.84 855.69 PAID
1. T'S HAIR PLUS 725.00 0.00 500.00
2. CINNAMON SKIN TAN 850.00
RAPIT PRINTING 850.00 850.00 889.00 926.72 889.00
TOTAL 6,325.00 4,750.00 5,206.83 5,224.18 3,742.22
YEAR TO DATE 11,075.00 16,281.83 21,506.01 25,248.23
1. Out of business; Kordiak will be advertising leasing of the space
wtthin the next two weeks.
2. HRA approved rent forgiveness. Kordiak still pursuing payment during
winter months.
Community Development Department
fl___/
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: January 3, 1991
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Application Fees and Process
At the December 13, 1990 meeting, the HRA inquired as to the status
of the TIF application process. Attached are the three handouts
that we will be giving to developers. The HRA approved these
procedures and fees at their July 19, 1990 meeting (see attached
minutes) .
The submittals consist of the following:
1. Policy statement regarding TIF administrative costs including
the schedule of fees.
2 . Agreement form which the developer would execute with the HRA
for an application.
3 . A three page application form.
Unless otherwise directed, we will continue to use these forms.
BD/dn
M-90-921
AGREEMENT FORM
Chairman and Commissioners of the
Housing and Redevelopment Authority
City of Fridley
6431 University Avenue N.E.
Fridley, MN 55432
RE: Application of for Tax Increment Financing
of a Project
Chairman and Commissioners of the
Housing and Redevelopment Authority:
This Letter of Agreement (the "Agreement") is given by
as (a) (the) (general partner) (president-vice
president) of , a organized
under the laws of the State of Minnesota (the "Applicant") in
connection with the review and consideration of Tax Increment
Financing for the (the "Project") by the Housing
and Redevelopment Authority in and for the City of Fridley (the
"HRA") . In consideration, the Applicant hereby covenants and
agrees as follows:
1. Consulting Services
The HRA shall have the right to employ legal counsel, bond
counsel, accounting, real estate, financial, engineering,
architectural, and other consultants to review the proposed
Project and all proposed financing therefor in accordance with
the Policy Statement (the "Policy Statement") attached to this
letter.
2. Other Costs and Expenses
The HRA shall also have the right to allocate and charge to
the proposed Project costs and expenses for photocopies,
publications, postage, and other similar items rendered or
incurred with respect thereto.
3. Payment of Costs
The Applicant shall pay all costs, expenses, and consulting
services incurred by the HRA with respect to the Project and
the issuance of Tax Increment Obligations to finance all or
part of the cost thereof, including but not limited to costs
and expenses of the types enumerated in paragraphs 1 and 2,
whether or not the Project is approved and constructed or the
HRA issues Tax Increment Obligations therefor. The Applicant
submits herewith a check in the amount of $ , the
proceeds of which may be deposited in a savings account by the
HRA and used and disbursed by the HRA to pay such costs,
Agreement Form
Page 2
expenses, and consulting services when due. Upon completion
of consideration of the Project or the issuance of Tax
Increment Obligation therefore, all such costs, expenses, and
consulting services not otherwise paid shall be paid from such
deposit by the HRA and any unexpended balance of such deposit
shall be returned to the Applicant. The fees advanced by the
Applicant and expended for costs, expenses, and consulting
services may be reimbursed in accordance with the Policy
Statement.
4 . Termination of Consideration
The City of Fridley (the "City") and the HRA shall have the
right at any time prior to the adoption of a resolution
approving the documents pursuant to which Revenue Obligations
are to be issued and their issuance, to terminate its
consideration of Applicant's Project and the issuance of Tax
Increment Obligations to finance the cost thereof, without any
liability of the City or the HRA, their respective officers,
employees and agents.
Applicant hereby releases the City and the Authority, their
respective officers, employees and agents, from any claims or
causes of action which it may have against them or any of them
for any costs, expenses, losses, damages or liabilities which
it may incur in connection with the City's and the HRA's
consideration of the Project; the failure of the City and the
HRA, in their discretion, to issue Tax Increment Obligations
for the Applicant's Project; the issuance and sale of the Tax
Increment Obligations; the construction of the Project; or any
other matter or thing of any type or nature whatsoever which
may arise in connection with any of the foregoing.
5. Indemnification
Applicant agrees to indemnify and hold the City and the HRA,
their respective officers, employees and agents harmless from
and against any and all losses, claims damages, expenses or
liabilities, including attorneys' fees incurred in their
defense, to which the City and the HRA, their respective
officers, employees and agents or any of them may become
subject in connection with the City's and the HRA's
consideration, issuance or sale of the Tax Increment
Obligations for Applicant's Project and the carrying out of
the transactions contemplated by this Agreement and any
resolutions adopted or Agreements executed by the City and the
HRA in connection with the issuance of Tax Increment
Obligations for Applicant's Project.
Agreement Form
Page 3
6. Assignment
The Applicant shall have no right to assign any claimed rights
it may acquire by reason of any action taken with respect to
Applicant's Project and the issuance of Tax Increment
Obligations therefor by the City and the HRA or their
respective officers, employees, or agents.
7. Fffective Date
The effective date of this Agreement is
Very truly yours,
Applicant
By
Its
Date
POLICY STATEMENT ON COVERING
TAX INCREMENT FINANCING (TIF) ADMINISTRATIVE COSTS
(adopted by ERA July 19,• 1990)
1. purpose
This Policy Statement establishes a policy and a procedure to cover
costs associated with processing a TIF request.
2. Intent
Inquiries are being received regarding the appropriateness or
availability of TIf monies for a project. The HRA does not employ
staff who are technically knowledgeable on TIF's. It is the intent
of this policy to provide expert assistance at no cost to the
general public.
3. Inquiries
a. General Inquiries
Staff personnel shall respond to general inquiries. This
assistance shall be general in nature for which no detail
or specialized knowledge is required.
b. Specific Inquiries
Once information or assistance is requested requiring
knowledge and/or assistance of a fee basis consultant to
the HRA, Section 4 (below) becomes operative.
4. Processing Specific Inauiries Throuah Authority Decision
a. When a point is reached that:
(1) consultant assistance is required, or
(2) an inquiry turns into a written proposal for
Authority consideration of a TIF application, and
the applicant shall be notified that a fee shall be
paid to the HRA.
b. No further activity shall occur until the fee is paid.
Once the fee is paid, the process shall continue.
c. Upon the discontinuance of the process or a final
determination by the Authority on an application, any
unexpended monies shall be returned to the applicant.
POLICY STATEMENT ON COVERING TAX INCREMENT
FINANCING (TIF) ADMINISTRATIVE COSTS
Page 2
5. Fees
a. The initial deposit amount shall be:
(1) for a request of $500,000 or less, $2,500;
(2) for a request of $500,000 to $1,500,000, $5,000;
(3) For a request of $1,500,00 or more, $7,500.
b. At any time the amount of deposit falls below $1,000, the
applicant shall deposit, within ten (10) days of written
notification, an amount to restore it to the initial
deposit amount.
6. Use of Fees
a. Fees shall be used for the cost of securing appropriate
consultants to assist the HRa in processing the inquiry
or application. Representatives of appropriate
consultants include, but are not limited to, HRA
Attorney, Planning Consultant,- Development and Financial
Consultant, Bond Counsel, Traffic and other consulting
engineers. The determination and use of HRA consultants
is and remains the exclusive determination of the BRA.
b. To all Consultant's invoices, there shall be added a 5%
administrative charge for the processing of such
invoices.
c. Upon completion of any inquiry or decision on a TIF
application, the BRA shall render a total of all claims
and charges paid. The HRA shall refund any outstanding
balance.
d. If TIF is approved then the applicant shall be reimbursed
its fees from bond proceeds or tax increments but only
if such reimbursement is statutorily authorized and
financially feasible.
APPLICATION FORM FOR TAX INCREMENT FINANCING
Business Name:
Address:
Type (Partnership, etc. ) :
Representative:
Telephone:
Name of Counsel:
Name and Telephone of Accountant:
List of Financial References: Name/Address/Contact/Telephone
Other Comments Pertinent to Your Application:
Have You Ever Filed for Bankruptcy? Yes No
If Yes, provide details on separate sheet
Have You Ever Defaulted on any Loan Commitment? Yes No
If Yes, provide details on separate sheet
INFORMATION CONCERNING APPLICANT'S PROPOSED PROJECT
Location of Proposed Development: (Attach a Drawing)
Nature of Proposed Business:
Principal Business or Product of the Company?
Is the Proposed Project a New Facility or Rehabilitation and/or
Expansion of Existing Facility?
Industrial/Commercial/Residential:
What is the Present Employment of Your Firm:
What is Your Estimate of Employment One Year After Completion of
Project:
What is Your Estimate of Employment Five Years After Completion of
Project:
Total Estimated Project Cost:
Total Estimated Construction Costs:
Potential Other Use(s) of Proposed Development:
Will this Development Attract Other Related Industries:
Yes No
How?
What Types?
What is the Current Zoning Status of the Project Site?
In Rezoning, will Zoning Variances or Conditional Use Permits be
Required in Connection with the Project?
-2-
•
Is the Property Properly Subdivided for the Proposed Use?
Has Site Approval been Obtained for this Project?
If So, When?
By Planning Commission?
By City Council?
Have You Applied for Conventional Financing for the Project?
Yes No
If Yes, Provide Details on Separate Sheet, "H. Information to
Attach"
If No, Why Not?
INFORMATION TO ATTACH
Please include:
State Public Purpose
Description of Project
Schematic Drawing of Project
Breakdown of Project Costs
Amount of Subsidy Request
Construction Schedule
Legal Description - (Include PIN's)
Other Pertinent Information
Deposit
-3-
HOUSING & REDEVELOPMENT AUTHORITY MTG. JULY 19, 1990 PAGE 3
but want to get some indication that both the City Council and
HRA are willing to proceed to do further analysis. Since Dave
Newman is leaving as HRA attorney, staff does not know how the
work is going to be divided on this project. He stated he does
not feel comfortable proceeding until he gets a clear idea of
what the assignments are going to be. Also, staff needs some
opinion from the City Council whether they are interested in
having the HRA proceed with such an arrangement where the HRA
would end up owning Village Green and hiring a property manager
to operate the facility so that they could ensure the
continuation of low and moderate income housing.
r. Robertson stated that at this meeting, he is recommending the
HRA implement a policy statement to charge an administrative fee
;;t4
of $7,500. He would also like some indication of the HRA's level
of interest in proceeding at this point.
Mr. Commers stated they should first address the policy
statement.
Mr. Robertson stated the administrative fee of $7, 500 for
recovering some of front-end costs for the analysis of
development proposals. Mr. Casserly helped staff develop this.
It is based on the experience they have had on the number of
projects where the financial analyses and feasibility studies
were done and then, for some reason or another, the projects were
not able to proceed and they were not even able to recover the
administrative costs through the additional tax increment
revenues. This fee would be refundable if and when the project
did proceed.
Mr. Commers asked if this policy is typical.
Mr. Casserly stated this concept is used in a number of cities.
He believed it is within the range of what is reasonable. The
policy tries to do two things:
1. To separate those developers who are just making
inquiries from those developers who really want to do
some projects.
2. To cover some of the HRA cash flow drain at the
inception of these things. There are a lot of up-front
expenses that take a long time to recover.
Mr. Commers stated that in terms of rendering services, the HRA
funds come from taxes so that is a consideration in how they
spend the money. Also, in the past the HRA has imposed certain
requirements upon developers such as letters of credit or asked
them to do studies or put up money to pay for certain things on
more of ad hoc basis. So, there are two sides to this issue.
}LOUSING & REDEVELOPMENT AUTHORITY MTG. JULY 19. 1990 PAGE 4
Mr. Robertson stated there is a circuit-breaker in the policy
statement (Section VI, Subd. C) which states: "Upon completion
of any inquiry or decision on a TIF application, the HRA shall
render a total of all claims and charges paid. The HRA shall
refund any outstanding balance."
Mr. Casserly stated he thought this is policy that will be very
helpful. As the HRA gets into very difficult redevelopment
projects where the HRA is out seeking redevelopers, this is not
the kind of policy that makes sense. So, the HRA does not have
to impose this policy when the HRA is initiating redevelopment.
This policy is trying to address the problem of developers coming
in and making application to use the powers and funds that are
available to the HRA for projects that are very specific to the
developers.
Mr. Casserly stated the HRA might want to implement the policy
and then review it in six months to see what the implications
are.
Mr. Meyer stated they can try the policy for a year. He asked
what some other cities are doing.
Mr. Casserly stated Arden Hills has this identical policy. New
Brighton is trying it on an ad hoc basis. On their last project,
they charged $6,000 for the initial work and were requesting
another $12,000 to complete what was rather a complex project.
White Bear Lake has a policy of getting between $2,500-5,000.
They try to gauge the difficulty of the work, and normally
anticipate a fee of somewhere between $7,500 and $12,500. That
has been uniform for two years. Again, when White Bear Lake
initiates a redevelopment project, they do not charge anything.
He stated it varies considerably between communities and those
that are into it more have developed more of a concern about some
of their out-of-pocket costs.
Mr. Prairie stated that since there seems to be some flexibility,
he would agree to trying the policy. If it doesn't work, they
can always change it.
Mr. Commers asked what happens of a developer does not pay the
fee.
Mr. Casserly stated the HRA does not approve the project. What
staff normally suggests when they prepare resolutions, the HRA
direct that the resolutions not be delivered or executed until
such time as the payment has been received. There is a letter
that goes with the policy statement in which the applicant signs
in which the applicant agrees to pay for these costs.
Ms. Schnabel stated the concept is good. The City charges its
own residents fees for variances, special use permits, etc. So,
v ,
HOUSING & REDEVELOPMENT AUTHORITY MTG. JULY 19, 1990 PAGE 5
it does not seem like a bad thing to charge a fee for other
things that involve staff time. She was -in agreement with the
fees as outlined in the policy statement.
MOTION by Mr. Rasmussen, seconded by Ms. Schnabel, to approve the
proposed "Policy Statement Tax Increment Financing (TIF)
Administrative Costs".
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
Mr. Comers suggested staff set up a statement for each applicant
for the next six months to see how it goes.
Mr. Robertson stated Dick Bienapfl is representing ASPRE, Inc.
Mr. Bienapfl has asked to have the HRA address their feelings
about proceeding with further analysis of a project of this type.
This is a very unique proposal and will require a lot of
analytical work.
Mr. Bienapfl stated the concept is basically that of attempting
to utilize the existing the Section 8 housing in the City of
Fridley, specifically, Village Green, in a sale mode that will
result in that housing being maintained as low income housing for
the life its contract and beyond that; at the same time,
capturing some of the revenues from the project to produce as
much as another 100 units of low income housing for the community
as well. It is very complicated. They have been working with
HUD, the Minnesota Housing Finance Agency, the owners of Village
Green, and Mr. Robertson and various other staff members to see
if this concept is something that makes some policy sense to the
City of Fridley. They have been working with staff to try to
identify some housing which is below standard, at risk, that,
utilizing this overall concept they are proposing, will allow
them to acquire and rehabilitate that housing and keep it on the
marketplace at low and moderate income rates.
Mr. Bienapfl stated he is just looking for some guidance from the
HRA that says they are generally interested in looking at this
proposal further. He has been told by Mr. Robertson that, due to
various changes in staff and a heavy workload, it might be at
least two months before they can pursue this with any vigor;
however, there are a lot of things they can do during the next
couple of months towards bringing a much more definitive proposal
to the HRA.
Mr. Robertson stated staff is also going to do a summary of this
and present to the City Council in the near future to get the
some reaction and policy direction from the Council.
Ms. Schnabel stated that several times it was stated in the
information received in the agenda packet that there have been
•
•
Community Development Department
0 J 1 HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: January 3,. .1991
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Information on Past Housing Rehabilitation
Programs
The HRA inquired at the December 13, 1990, meeting about the
history of the housing rehabilitation program in Fridley. I
discovered the files for this program in two boxes in the vault.
Between 1977 and 1982, the City carried out at least three housing
programs including rental rehabilitation loans, assistance for
rehabilitation of single family detached houses, and acquisition
of scattered sites of substandard units for the Large Family
Ownership Program.
Attached is a newspaper article from October 1978 which outlined
the three programs initiated by the City and the HRA for
rehabilitation assistance and assistance for new single family
detached homes (Large Family Ownership Program) . About 100 homes
were assisted with CDBG funds for home improvements. The number
of rental units assisted could not be determined. There were 15
properties identified as substandard in the City's Housing
Assistance Plan prepared in 1979. Of those properties, I found six
acquisition files where the HRA acquired those properties and sold
them to new home owners eligible for the Large Family Ownership
Program. Attached is a description of the selection procedure for
the program and the program components. If the homeowner lived at
the site for ten years, the mortgage amount would be forgiven. The
HRA will have to file mortgage satisfaction documents at the
Recorder's Office when the ten years have elapsed on the subject
properties.
These programs were aimed at improving the housing quality in the
Hyde Park and Riverview Heights areas. It appears that the program
was very successful and achieved the objectives which were set for
these two areas.
BD:ls
M-91-02
October 1978
tl
•
.�
,�. ; Councii paves way
for $250,000 • •
HUD
fund proposal
The Fridley City Council voted personal gain.
Monday evening to submit a letter of Only those units which are open to
intent to the Metropolitan Council federal Section 8 low income housing
which places the city in contention • subsidies will qualify for the loans.
for $250,000 in Housing and Urban The maximum low-interest loan is
Development (HUD) Community set at$10,000 at six percent interest.
Development Block Grant funds. A total of$90,000 would be available
By a 4-1 margin the council ap- for this part of the program.
proved a modified version of a Frid- — Home ownership assistance.
ley Planning Commission proposal This phase of the program would
for squiring the HUD funds which provide 10- 12 interest free loans of
were recently made available for low up to$4,000 to cover the initial down
and moderate income housing in the payments and closing costs of pur-
tetropolitan area. chasing a home.The program would
In order to qualify for the funds "make home ownership more avail-
municipalities are required to submit able to low and moderate income
a letter indicating interest in the 'large families' (over five people)."
monies no later than Oct.6.The letter The loan money would be distri-
is not a formal application for the buted through private neighborhood
federal funds. organizations.There would be$40,000
. The proposal approved by the available for this phase of the prog-
council is in the form of a three part ram.
program to help rehabilitate rind re- COUNCILMAN Ed Hamernik cast
aovate areas of the city suffering the one dissenting vote for the prog-
from urban decay. ram.Although Hamernik said he was
: The three steps in the proposal are: not "entirely in favor of the entire
—Acquisition of scattered site sub- project," he voiced his greatest ob-
standard units. This portion of the jections concerning the rental unit
program would utilize federal funds low-interest loans.
to acquire single family housing in The potential for the misuse.of the
the city which is beyond repair. The low interest loan money by apart-
homes on the acquired lots would be ment owners coupled with what
demolished and the families relocat- Hamernik viewed as questionable
ed. The cost of the site acquisition benefits to renters helped sway his
i budgeted at$20,000 per unit and.the vote in opposition to the proposal.
cost of relocation at$10,000. IN OTHER ACTION the council
' According to the Planning Corn- approved an expansion of the munic-
'mission, there are approximately$5 ipal liquor store in the Holly Center.
-to 30 substandard units in the city The back of the store will be extended
beyond rehabilitation. Since there is in order to provide additional storage
,' my 6120,000 proposed for this portion space and cooler space for wines and
of the program,only four sites could beer.
be aquired. Liquor store manager Bob
—Rental unit rehabilitation loans. McGuire and city Finance Director
his portion of the program would Marvin Brunsell had argued that the
r.provide low-interest loans to apart- additional space was needed in order
anent owners for the purpose of up- to promote sales in the store.At pres-
grading Mien or rental nila,goia Sicily store ptnducrn.a better
In the city..A stipulation imposed per square feotthan the city's
e(Won this program by the council other liquor store at 6289 Hwy.65 NE.
would provide for a matching invest- Brunstll and McGuire contended,
Meet in order tp-iasure against mis- however,that improvements planned
i.e of grant money. for the Holly Center and the future
There was a concern by some needs of the liquor store, coupled
z.eeouncil members that owners of ren- with a present shortage of storage
-tal property would use the low- space, necessitate expansion of that
tjlpWest Ins as an opporrttunnity for facility. •: •
SELECTION PROCEDURE FOR
LARGE FAMILY HOME OWERSHIP PROGRAM
1. Large Family Classification - This requires a family size of five or more
persons.
2. Income Eligibility - The family income must be verified and fall within
the Section 8 income guidelines as laid out by HUD.
Number of Persons Income Limits
Five $17,850
Six $18,900
Seven $19,950
Eight or More $21 ,000
3. Must meet qualifications of 235-265 Housing Program administered by HUD.
(Maximum construction cost $52,800 - Maximum mortgage allowed $44,000).
4. Selection of families by the Fridley Housing and Redevelopment Authority
will be done on a first come basis, and will be numbered as applications
as received.
5. A listing of approved contractors will be set up and distributed to
eligible families so that they may select house plans more suitable
to their needs, with review and approval by the Housing & Redevelopment
Authority staff to review budget considerations.
JLB/de
r n
The City of Fridley has obtained. Community Development Block Grant
Bonus funds to provide opportunities for home ownership for large family, low
and moderate income households. Using the CDBG funds, Fridley can write down
the land costs and enable the construction of homes that fall within the price
guidelines of the Minnesota Housing Finance Agency Affordable Homes Program.
This program offers a substantial interest rate break for the eligible home
buyer. With lower interest rates, home ownership is made possible by keeping
the monthly housing payment within the means of low to moderate income families.
The qualifications for family participation are as follows:
1. Large family - at least five persons.
2. Family must apply for, and qualify for, a mortgage either through
the Minnesota Housing Finance Agency, affordable home participating
lender, or a Section 265 FHA lender.
3. Family income must fall within the Section 8 income guidelines.
4. Must have funds for down payment and closing costs.
For further information on the large family housing program, please call
571-3459, extension 163.
77 Community Development Department
1---\ HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
� P.
TO: Housing and Redevelopment Authority Members+•'
FROM: William W. Burns, Executive Director of the HRA
DATE: January 2, 1991
SUBJECT: Request from Potential Buyer of
Fridley Plaza Office Building
Shortly before Christmas, I was approached by Mr. Dan Cardona, who
claims to represent a group that is headed by Jerry Caputa.
According to Mr. Cardona, the Caputa group is investigating the
possibility of buying the Fridley Plaza office building for
approximately $850,000. The question they raised is whether or not
the HRA would be willing to consider a reduction in taxes for the
building, and a reduction in the fee that the HRA charges for the
rental of the parking ramp. They also asked that I provide a copy
of the development agreement, the second mortgage agreement the HRA
has with the owners of the office building, and the rental lease
agreement for the parking ramp.
After providing the documents and taking the time to examine them,
as well as to think about their requests, it occurred to me that
there is not much advantage to the HRA in meeting these requests.
The taxes are guaranteed by the development agreement in the amount
of approximately $73,000 per year. If we were to give in on this
item, we would in all likelihood be opening up a Pandora's box that
others would want to take advantage of. As for the rental
agreement for the parking ramp, I suggested to Mr. Cardona that
the group provide any written documentation that they could find
that would indicate that this price was too high.
Also, in responding to their requests, I suggested that if they
wanted to prepare a presentation for the HRA, I would be happy to
put them on a future HRA agenda, and to give them time to carefully
state their case to you.
To date, I have not heard any further from Mr. Cardona or Mr.
Caputa. If I do, I will keep you informed.
WWB:rsc
1
,
e
0 I- 7 Community Development Department
F.-A HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
TO: Housing and Redevelopment AuthoritX Members
FROM: William W. Burns, City Manager r`,ivy
DATE: January 2, 1991 {1
SUBJECT: Status of Tax Collections for
Various Tax Increment Projects
At the last HRA meeting, we were discussing the turnback of TIF
revenue to the schools. As part of that discussion, questions were
raised about the potential for additional growth in the money that
is turned back to the school systems.
In view of that discussion, I asked the Finance Department to look
at our various projects and determine where we are versus
projections for those projects. As you can see from the attached
table, we still have quite a bit of tax capacity growth for the
Northwest Racquet Club in 1992. Unfortunately, in other areas, we
are losing tax value due to the depressed market for office space
and other commercial uses. At this point, I have not calculated
any net impact. However, the table does give a good overall view
of potential project revenues.
Rick Pribyl and Paul Hansen should be available Thursday night to
respond to any questions you may have.
WWB:rsc
Attachment
w Co U U 0 0 0 CO 0 0 0 0 0 0 Q 0 0
F-►2) Q hi 'Cl... cD CD ". N a M o) 0 U co N
2 a. rU) N 0) i-
t } Q cio i CD N N CD H (Vc' 9 9 9 i9 9 H 07 Q• y a C) N i 44 C0a E9N W g v W rn
W CO) 0 0 0 0 00 0 0 0 0 0 w N O o
H sp O O O I- p) 0 0
U 0 O co U = Q 0 COO
O O ^ CD
CO cy N N N 07 (A C9 44
K) T
co rn
0 _ O an O o CO O Co
W N U ^ N U) F- CD 0 d' 0) 0 0 0 0 O O
F.. co Q ^ N 0 U) CO 0) LL 77 O) cD
a v C7 F- N - Lo t: N. 0 CA cin
r
2 >- Q c0 0 CO N n TiN 1- N C to T T UJ N CO
10 CI '9 W < N 49
p a X N ET9 49 0 i9 49 y m E9 fA E9 5 d 0 49
W F. v 0) 0 It W O
a ¢ rn
'o 0
o, 0-
to"
oa 0 0 0 0 O o o 4- 4 0 0 0 o 0 N C) 0 0 F- coO O 0 El O O o w I- 0 0
>- 2 'To U U cN•) U CDD O C C 0 0 0 0 0 CO
Q W N Cr) LA N in Co) co 0 m 0 0 0 W < COD COO
a N N T Cr) i9 C9 i9 i9 C9 ¢ Cn ^Q
T CA T (9 T N C T W a CV C�?
rn 49 69 a .- '9 a w O '9
E Y 0 CC
O Fs w
^o «. E N cn 1- O to cD Tr 13 It) 0
C Q . Cr)r) st 0 et .-- N O O N N N CD
C') >.. U
� C
Q (N o T N E9 H a d 49 49 49 - '- 69
r. C9
oX cv iR FA y C d b9
ILI
_zz 0
O E 0
~ T O O O 0 0 O O O w O O o --� 0 0
Up) N Cr) T 0 CD r) T ate.. k- CD O 4N. J O COD
7 co. cm CO 1f) i Cr) T N O CA CA T
O) 0)
O } T F- N Cr) 0 U) T Ll CO 0 CA F- U)
N ¢ a w N v N N N Cr) T O co Cn CA CO cn U) 0)
F. a. N L T of 49 49 49 I 49 49 W (y
O ¢ C 0E-
O a a 0 0 o 0 o o € N Z o ca
N W W CO Z Z O Z
2 F- W V coo co co co U 'V COD O m < W o O
Z M N N M K K ; 3 Z Q I Z Z Q Z
W p
¢ co 0 49 49 m O _ V, >
¢ WT C .' 2Q
O
O w N
2 mLu
Cn a LL z
O F- co C C co(C 0 y W
U W °� U Y W o C U
to Y U Ul ti o Z Q m m CC to w ,::
LL
0
F- 5Z v O m 5 a 9 o m•E a > > Z $
¢ U W a U Y 0 = 0 z a a y Z Z O
F- ¢ ¢ a 2 v) z a- ¢ 0 > L m > > a W cn
Q N o = Z ala D.
G o 0 a N Y O¢ Q
U. C x y N 1 m E P) P° 5 czn con
F- Ilk Niv,
COC) F- O F- T Cr) 10 CD 03