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02-02-2023 Housing & Redevelopment Authority Regular Meeting February 02, 2023 7:00 PM Fridley City Hall, 7071 University Avenue N.E. Agenda Call to Order Roll Call Action Items 1.Approval of HRA Expenditures from January 2023 2.Approval of the Minutes from the HRA Meeting of January 5, 2023 3.Approval of HRA Resolution No. 2023-03, Increasing Interest Rate on Non-Deferred Home Improvement Loans 4.Approval of HRA Resolution No. 2023-04, Approving Purchase of 1340 Mississippi Street N.E. 5.Approval of TIF Assistance 6.Approval of HRA Resolution No. 2023-06, Authorizing Execution and Delivery of a Contract for Private Redevelopment Informational Items 7.Update on Housing Programs Adjournment Upon request, accommodation will be provided to allow individuals with disabilities to participate in any City of Fridley services, programs, or activities. Hearing impaired persons who need an interpreter or other persons who require auxiliary aids should contact the City at (763) 572-3450. 2 Jufn!2/ AGENDA REPORT Meeting Date:February 2, 2023 Meeting Type:Housing & Redevelopment Authority Submitted By:Paul Bolin, Assistant Executive Director Title Approval of Expenditures Background Attached are the check reports for the month of January2023. Recommendation Staff recommend the HRA approve the expenditures for the period January 1 through 31, 2023. Attachments and Other Resources Check Reports Vision Statement We believe Fridley will be a safe, vibrant, friendly and stable home for families and businesses. 3 Jufn!2/ 4 Jufn!2/ 5 Jufn!3/ AGENDA REPORT Meeting Date:February 2, 2023 Meeting Type:Housing & Redevelopment Authority Submitted By:Paul Bolin, Assistant Executive Director Title Approval of the Minutes from the HRA Meeting of January 5, 2023 Background Recommendation Staff recommends the HRA approve the minutes from the meeting of January 5, 2023. Attachments and Other Resources HRA Minutes January 5, 2023 Vision Statement We believe Fridley will be a safe, vibrant, friendly and stable home for families and businesses. 6 Jufn!3/ Housing and Redevelopment Authority January 5, 2023 7:00 PM Fridley City Hall, 7071 University Avenue NE Minutes Call to Order Chairperson Showaltercalled the Housing and Redevelopment Authority meeting to order at 7:00 p.m. Present Elizabeth Showalter Gordon Backlund Troy Brueggemeier Rachel Schwankl Kyle Mulrooney Paul Bolin, HRA Assistant Executive Director Stacy Stromberg, Planning Manager Vickie Johnson, Development Consultant Action Items 1. Approval of Expenditures from November and December 2022. Motionby Commissioner Mulrooneyto approve the expenditures. Seconded by Commissioner Backlund. Upon a voice vote, all voting aye, Chair Showalterdeclared the motion carried unanimously. 2.Approvalof the Minutes of from the November 3, 2022,HRA Meeting. Motionby Commissioner Schwanklto approve the meeting minutesof November 3, 2022,as presented. Seconded by Commissioner Brueggemeier. Upon a voice vote, all voting aye, Chair Showalterdeclared the motion carried unanimously. 3. Resolution No. 2023-01 Designating Official Depositories for the Year 2023. Paul Bolin, HRA Assistant Executive Director, commented that the HRA is required to designate an official depository each year. He commented that Wells Fargo has the been the official bank of the City and HRA for many years and it is recommended to continue as such. Motionby Commissioner Backlundto approve HRA Resolution No. 2023-01 DesignatingWells Fargo as theOfficial Depositoryfor the Year 2023. Seconded by Commissioner Mulrooney. 7 Jufn!3/ Housing and Redevelopment Authority 01/05/2023 Minutes Page 2 Upon a voice vote, all voting aye, Chair Showalter declared the motion carried unanimously. 4. Designation of an Official Newspaper for 2023 Mr. Bolin stated that annually the City and HRA designate an official newspaper, used to make notice of public hearings and other legal publications. The Minneapolis Star Tribune has been the official newspaper for the past five years and it is recommended to continue as such. Motion by Commissioner Backlund to approve HRA Resolution No. 2023-02 designating the Minneapolis Star Tribune as the official legal newspaper of the Fridley Housing and Redevelopment Authority for the year 2023. Seconded by Commissioner Mulrooney. Upon a voice vote, all voting aye, Chair Showalter declared the motion carried unanimously. 5. Recommend Approval of S-2 Zoning, Master Plan Moon Plaza Redevelopment. Stacy Stromberg, Planning Manager, presented a rezoning request from Roers Companies. She stated that the applicant is requesting three land use items to allow for the redevelopment of the Moon Plaza; a Comprehensive Plan Amendment, Rezoning, and Plat. She stated that when a property is requested to be rezoned to S-2, Redevelopment District, the HRA must review the request. She provided background information on the Moon Plaza and the requested rezoning noting that the multi-family housing project will revitalize the property. She reviewed details of the proposed residential project that will provide 169 units of affordable housing with one-, two- and three-bedroom units. She also provided details on a housing study and traffic study completed by the applicant. She stated that the Planning Commission held a public hearing the previous night and unanimously recommended approval with the stipulations noted in the packet. This item will move forward to the City Council on January 9, 2023. The HRA has if there would be an impact to sewage flow from the change in use. There was also a question as to what would happen to the current commercial tenants. Ms. Stromberg commented that Engineering was comfortable with the proposal and proposed utilities. She replied that the property owner would manage the tenants. Andy Bollig, Roers Companies, commented that they are working with the landlord to follow the stipulations of the leases. He noted that the landlord has alerted the tenants of his plans to sell over the past few years and they are either working to relocate tenants or terminate leases in accordance with the proper terms. Mr. Bolin commented that staff is also working to ensure that relocation assistance can be provided if desired. The HRA asked and received confirmation that the entire project would be affordable housing. It was also noted that if the applicant is going to request TIF in the future, they should consider a portion of the units at a lower affordability. The HRA hoped that the businesses would attempt to 8 Jufn!3/ Housing and Redevelopment Authority 01/05/2023 Minutes Page 3 stay in Fridley and asked for details on the fire lane requested. Mr. Bollig provided details on the process that would be followed to verify income and noted that five percent of the units would be at 30 percent AMI. Ms. Stromberg provided details on the requested fire lane and the attempt of staff to make that more aesthetically pleasing and add more greenspace. She also provided details on the low occupancy rate at similar apartment buildings that were recently constructed. Motion by Commissioner Brueggemeier, to recommend approval of the Rezoning for the Moon Plaza at 6257 University Avenue from C-3, General Shopping to S-2, Redevelopment District. Seconded by Commissioner Schwankl. Upon a voice vote, all voting aye, Chair Showalter declared the motion carried unanimously. Informational Items 6. Housing Program Update. Mr. Bolin provided a summary of the HRA loans and other program activity during 2022. Adjournment Motion by Commissioner Brueggemeier to adjourn the meeting. Seconded by Commissioner Schwankl. Upon a voice vote, all voting aye, Chairperson Showalter declared the motion carried unanimously and the meeting adjourned at 7:28 p.m. Respectfully submitted, Melissa Moore City Clerk 9 Jufn!4/ AGENDA REPORT Meeting Date:February 2, 2023 Meeting Type:Housing & Redevelopment Authority Submitted By:Paul Bolin, Assistant Executive Director Title Increase Interest Rate for Home Improvement Loan Programs Background In 2018, the HRA lowered the interest rates, on its non-deferred Home Improvement Loans down to the interest rates for all consumer loans have risen dramatically. In fact, the Minnesota Housing Finance Agency is now charging a range of 5.75% up to 6.875% depending on the term of the loan. Neighboring communities are all raising their interest rates as well. Several years ago, the Authority used a formula (tied to the prime interest rate) that set interest rates for the loan programs. The daily changes made it difficult to market the loan program and it was determined to set a reasonable interest rate for the current market conditions and adjust it when the market makes large swings. An interest rate of 4% would still provide incentive for residents to reinvest in their homes, while providing a little extra return that the Authority can reloan. Recommendation Staff recommend the approval of HRA Resolution No. 2023-03, increasing the interest rate on non-deferred Home Improvement Loans from 2% to 4% effective March 1, 2023. Attachments and Other Resources HRA Resolution No. 2023-03 VisionStatement We believe Fridley will be a safe, vibrant, friendly and stable home for families and businesses. : Jufn!4/ Resolution No. 2023 - 03 Increasing Interest Rate on Non-Deferred Home Improvement Loans Whereas, the Fridley Housing and Redevelopment Authority (Authority), has provided Home Improvement Loans with interest since 1994, and; Whereas, the Authority has monitored and adjusted the interest rate charged to reflect current market conditions, and; Whereas, the current rate is well below the rates being charged by both the Minnesota Housing Finance Agency and commercial lenders. Now, therefore be it resolved, that, effective March 1, 2023, the interest rate charged on the -deferred Home Improvement Loans shall be 4%. Passed and adopted by the Housing and Redevelopment Authority in and for the City of nd Fridley this 2 day of February, 2023. _______________________________________________ Elizabeth Showalter Chairperson Attest: __________________________________________________ Walter T. Wysopal Executive Director 21 Jufn!5/ AGENDA REPORT Meeting Date:February 2, 2023 Meeting Type:Housing & Redevelopment Authority Submitted By:Paul Bolin, Assistant Finance Director Title Approval of Purchase 1340 Mississippi Street Background Since May 2021, the Authority has purchased three properties at the SE intersection of Mississippi Street and Old Central Avenue NE. After nearly two years of following the property at 1340 Mississippi through a forfeiture, probate and finally being offered for sale by Fannie Mae, the Authority has a signed purchase agreement on the property for $175,000. This acquisition now closes the gap on Mississippi Street and provides an area of approximately 3 acres for future development. Vision Statement We believe Fridley will be a safe, vibrant, friendly and stable home for families and businesses. 22 Jufn!5/ Recommendation Staff recommend the approval of HRA Resolution No. 2023-04, approving the purchase agreement and authorizing the Assistant Executive Director to sign documents needed to close on the property located at 1340 Mississippi Street. Attachments and Other Resources HRA Resolution No. 2023-04 Vision Statement We believe Fridley will be a safe, vibrant, friendly and stable home for families and businesses. 23 Jufn!5/ Resolution No. 2023 - 04 Approving Purchase of 1340 Mississippi Street NE Whereas, the Housing and Redevelopment Authority (Authority), has identified the area near the intersection of Mississippi Street and Old Central Avenue as a priority redevelopment area, and; Whereas, the Authority had initiated conversations to purchase properties in the area in 2019, resulting in purchasing three adjoining parcels, and; Whereas, the Fannie Mae Corporation has agreed to sell the home at 1340 Mississippi to the Authority for $175,000. Now, therefore be it resolved, that, the Authority approves the purchase and authorizes the Assistant Executive Director to sign documents necessary to close on 1340 Mississippi Street NE. Passed and adopted by the Housing and Redevelopment Authority in and for the City of nd Fridley this 2 day of February, 2023. _______________________________________________ Elizabeth Showalter Chairperson Attest: __________________________________________________ Walter T. Wysopal Executive Director 24 Jufn!6/ AGENDA REPORT Meeting Date:February 2, 2023 Meeting Type:Housing & Redevelopment Authority Submitted By:Paul Bolin, Assistant Executive Director Title Approval of TIF Assistance Background Pleasesee attached Staff report, memorandum from Financial Advisor Tammy Omdal and TIF Plan. Recommendation Staff recommend the approval of HRA Resolution No. 2023-05, approving TIF assistance. This item will receive a public hearing and consideration for approval at the February 13, 2023, City Council meeting. Attachments and Other Resources Staff Report Memorandum from Northland Public Finance (Tammy Omdal) TIF Plan for Proposed District #26 HRA Resolution No. 2023-05 Vision Statement We believe Fridley will be a safe, vibrant, friendly and stable home for families and businesses. 25 Jufn!6/ Resolution No. 2023 - 05 Authorizing Modification of The Redevelopment Plan for Redevelopment Project No. 1 and the Tax Increment Financing Plans for Tax Increment Financing Districts Nos. 6,11-13 and 17-25 to Reflect Increased Project Costs and Increased Bonding Authority within Redevelopment Project No. 1, Creating Tax Increment Financing District No. 26, and Adopting a Tax Increment Financing Plan Relating Thereto Whereas, Whereas, Whereas, Whereas, Whereas, Whereas, Now, therefore be it resolvedthat 26 Jufn!6/ Passed and adopted by the Housing and Redevelopment Authority in and for the City of nd Fridley this 2day of February, 2023. _______________________________________________ Elizabeth Showalter Chairperson Attest: __________________________________________________ Walter T. Wysopal Executive Director 27 Jufn!6/ 28 Jufn!6/ HRA ProjectSummary The Request Roers Companies is requesting Tax Increment Financing (TIF) assistancefor the redevelopment of the Moon Plaza property, located at 6257University Avenue N.E. The redevelopment will allow for the construction of a 169-unit affordable multi-family rental housing development.There are a number of extraordinary costs associated with the redevelopment that would prevent the project from moving forward without the assistance. Site Description and History The Moon Plaza Shopping Center was constructed between1963-1965. Over the years it has been home to wide variety of retail and office users including a dry cleaner, a beauty salon and barber shop, small grocery stores, military recruiting offices, a café, and many others. A photo from 1975 shows there once was a small a small photo matbuilding in the parking lot. The property sits onthe University st Avenue Service Drive, north of 61 Avenue. It is bordered by St. Williams Church to the south, small commercial users to the north, and Norwood Square, an affordable senior independent living community to the east. The property has been a source of criticism for many years, even datingback to 1985. At that time, the City Manager asked the Planning Coordinator to evaluate the vitality of the outdated, run-down strip center. The memo notes that the buildingslack of architectural character, sufficient tenant floor space, landscaping, attractive lighting, and other contemporary amenities commercial tenants are looking forhindered itsability to attract quality tenants. Over the last two Comprehensive Planning processes, staff has heard from many people in the community, who want to see something done with the outdated Center. Concerns raised werelikethat of the Holly Center:the poor condition of the structure and itsfaçade, an overabundance of parking, and lack of landscaping. As a result of community concerns and the overall condition of the property, ithas been placed in a redevelopment district in Њ 29 Jufn!6/ The property has been under the same ownership since the early 1990s. The owner has generally been responsive and willing to work with the City as issues have come up; however, with no major reinvestment in the building and property over the last 40 years, it has become very tired, and is in desperate need of redevelopment. Roers Companies started discussions with the property owner in early 2022 to potentially purchase the property. Roers has a letter of intent to purchase the property contingent upon these land use items being approved. Proposed Project The petitioner is proposing to redevelop the Moon Plaza property by constructing a new 169-unit affordable multi-family housing development. There will be a mix of 1 bedroom, 2 bedroom and 3- bedroom units, with rents affordable to households earning 60 percent of area median income (AMI). Eight of the units will be set aside for households making 30% or less of the AMI. There will be 265 parking stalls on site, with 167 of those underground. The building will be 5- stories along the east side, and the north and south sides of the building will step down to 4-stories. Common area amenities will include a community room, outdoor patio, resident storage areas, a dog wash station, a game room, a playground, a dog run, and a seating and gazebo area. A Moon Plaza Multifamily Redevelopment is a transformation of an existing aged retail strip center into a new affordable housing development. The project will create a high-quality development that enables lower than market rents making housing more accessible. It will target an underserved population of renters without sacrificing finish levels and amenities. The rent levels will be set to serve families and individuals who earn 60% of the area median income (AMI), which is an annual income of $56,320 for a family of 2, and $70,380 for a family of 4. Sixty percent AMI translates to monthly rents for this project being approximately $1,242 for a one-bedroom, $1,489 for a two-bedroom, and $1,717 for a 3-bedroom. Applicants will need to submit income eligibility that is verified by a rd 3 part Eight of the units will be set aside for households making 30% of the area median income. Ћ 2: Jufn!6/ The chart below shows the 2022 income limits for the Minneapolis-St. Paul Metropolitan Area, at 60% to 100% of AMI, based on household (HH) size, put together by the US Department of Housing and Urban Development (HUD). 5 for 2022. Income 1 Person 2 Person 3 Person 4 Person Limit HH HH HH HH 100% $82,740 $94,560 $106,390 $118,200 80% $62,600 $71,550 $80,500 $89,400 65% $53,536 $61,184 $68,832 $76,480 60% $49,280 $56,320 $63,360 $70,380 30% $24,650 $28,200 $31,700 $35,200 Comprehensive Plan Analysis and uses that are generally privately owned and operated for profitpetitioner requests the site - - identified Redevelopment 3.66-acre site, the proposed density is 46 units per 2030 Comp Plan acre. The site is near the Rapid Transit (BRT) st stops at 61 Avenue, and Mississippi Street, where higher density development may be warranted. Density at other recently constructed Multi- Family project locations are approximately: 35 units per acre at The Cielo Apartments, 32 units per acre at Fridley Station Village (Altair, Aura, & Ursa Apartments), and 36 units per acre at Axle Apartments. During the 2030 and 2040 Comprehensive Planning process, City staff continued to hear from like to see something done with the Moon Plaza property. The concerns raised were related to the condition of the structure, the façade, the abundance of parking, and lack of landscaping. The 2030 Comprehensive Plan (adopted in 2009) and the 2040 Comprehensive Plan Ќ 31 Jufn!6/ 2040 Comp Plan Additionally, the Metropolitan Council has allocated needed affordable housing units to Fridley. This allocation is addressed in the Housing Chapter. By 2030, the Met Council anticipates Fridley will need at least 122 housing units which are affordable to residents earning 51 to 80 percent of AMI. The petitionerproposes to build 169units at this affordability level. In theirhousing study, the petitionerestablishes significant demand for housing affordable to households earning 60 percent of AMI or less, more thanthe 122 units anticipated in the forecast. Moreover, thehousing study addresses providing housing to existing area residents, growth. Therefore, proposing to create 161units of housing affordable at 60percentAMIand 8 units at 30 percent AMIis consistent with the Comprehensive Plan. Site Plan Analysis The proposed project is a 169-unit affordable housing building that will have a mix of 1 bedroom, 2 bedrooms, and 3 bedrooms. Each unit will include a washer and dryer, stainless steel applies, quartz counter tops, and 9 ft. ceilings. Common area amenities include a community room, a game room, resident storages areas, an outdoor patio with a dog run, and tot lot, and sidewalk and connections to existing sidewalk and train systems. Parking The R-3, Multi-Family Ѝ 32 Jufn!6/ zoning code requires 339 parking stalls for this project, based on the breakdown of types of units, which is 1.57 stalls per unit. The petitioner is proposing 265 stalls, 167 of those will be underground and 98 will be surface stalls, which is deficient to the code requirements by 74 stalls. Though the -3, Multi-Family code regulations, it is consistent with the parking per unit ratios the City has approved for other recently constructed multi-family housing projects. The Axle Apartments and the Train Station Village Apartments have a parking ratio at 1.57 stalls per unit and have been operating without any on-street parking complaints. Housing Study Analysis The applicant provided a housing market study prepared by Novogradac, a real estate consulting The report defined a Market Area for analysis and utilized socio-economic and demographic characteristics to estimate demand for this new multi-family housing development. Overall, the report established a market need for at least 175 apartments affordable to households earning 60 percent of AMI. (Due to changes to the project from the time the report was commissioned, this is more than the number of units currently being proposed.) Due to the number of cost-burdened households within the Primary Market Area who pay more than 35 percent of their income for housing, the report predicts demand for and rapid uptake of the new apartments. The report notes as weaknesses the relatively smaller size of the units, compared to competitor properties. The proposed units are found to be 9.5 to 14 percent smaller than other average units; however, the report finds they are within the range of acceptable sizes. Additionally, the report finds that higher quality construction and building components will be an asset to offset any size-related drawbacks. Comparable properties have vacancy rates from zero to 6 percent, and on average this figure is quite low and indicates housing demand in the market. Additionally, several comparable propertiesincluding the recently-completed Low Income Housing Fridleymaintain waiting lists for their units. Employment characteristics in the Primary Market Areaincluding concentrations in healthcare and manufacturing income to remain relatively stable in the face of an economic downturn. Beyond local demand, at least 15 percent of residents are estimated to come from outside the Primary Market Area. The Ў 33 Jufn!6/ report notes that Fridley experiences a significant in-migration of workers who travel to Fridley to work but live outside the community. Staff Recommendation Staff recommends the Authority approve TIF request. Staff recommends the Authority approve Development Agreement with Roers. Џ 34 Jufn!6/ MEMORANDUM To:Paul Bolin, Fridley HRA Assistant Executive Director From: Tammy Omdal, Managing Director Jessica Green, Managing Director Date:January 18, 2023 Re:Tax Increment Financing (TIF) Assistance for Housing Project in Fridley (Moon Plaza) The Fridley Housing Redevelopment Authority (the “HRA”) requested that Northland review the revised Application from Roers Acquisitions LLC (the “Developer”) for tax increment financing assistance. In preparing this review, Northland relied on information included in the Application and subsequent follow-up information from the Developer. The Developer is requesting $6,126,000 from the HRA, in the form of tax increment financing, for the purpose of providing gap financing outside of Tax-Exempt Bonds and Federal Tax Credits the developer is seeking from other governmental entities. The financial assistance is proposed to be on a “pay-go” basis and payable over a term not to exceed 26 years. The project consists of the demolishing of the existing Moon Plaza retail strip center and constructing an approximate 168-unit residential apartment building plus underground and surface parking and associated amenity areas, both indoor and outdoor (the strd “Project”). The Project is located on University Avenue between 61 Ave NE and 63 Ave NE in Fridley (the “Property”). All apartment units will be affordable with income and rent restrictions at or below 60% of the area median income (AMI). The 2022 AMI for Anoka County as calculated by the U.S. Department of Housing and Urban Development is $118,200. The request is for the HRA to establish a redevelopment TIF district to capture the increase in property taxes from the Project to assist with the financing of the redevelopment of the site and development of the affordable housing project. Northland Securities, Inc. 150 South Fifth Street, Suite 3300, Minneapolis, MN 55402 Toll Free 1-200-851-2920, Main 612-851-5900, www.northlandsecurities.com Member FINRA and SIPC | Registered with SEC and MSRB 35 Jufn!6/ TIF District 26 January 18, 2023 Page 2 Northland reviewed the information submitted by the Developer related to land acquisition and construction costs, developer fees, operating expenses, and rental rates, among other items. We find the information provided to be within general industry standards. Exhibit A provides a preliminary source and use of funds for the approximate $49.5 million Project. The Developer anticipates the cost of the Project will likely increase as other project costs, including relocation costs, are taken into full account. Observations It is Northland’s observation that the Project, as proposed, is feasible only through assistance, in part from TIF combined with other public assistance. This observation may change if information about the Project changes. Financing redevelopment and construction of affordable housing takes multiple sources to achieve rents at affordable levels. Based on the Application, the Developer proposes to maximize public finance tools to include 4% Low-income Housing Tax Credits (LIHTC), Tax-Exempt Bonding, and TIF to assist with financing the Project. Tax-exempt bonding (first mortgage) is anticipated to finance approximately 49.8% of the costs of the Project. The Developer will defer a portion of the developer fee and rely on a letter of credit for the balance of funds. The deferred developer fee is not guaranteed. It will be paid from future net cash flow from the Project. Subject to the estimated terms of assistance, we find that the Project, as proposed, would not be reasonably expected to occur solely through private investment within the reasonably near future. Based on the pro forma developed by Northland, using information from the Developer and information independently prepared by Northland, we find the requested amount and duration for the assistance, subject to final terms of the first mortgage, to be reasonable and necessary. We estimate the Project is feasible with TIF assistance to the Developer in an amount no greater than $6,126,000, with a maximum term of 26 years and 5.0% rate. This is based on the HRA providing 90% of the TIF collected to payment on a note issued to the Developer, with assistance provided on a “pay-go” basis payable solely from TIF. The HRA would retain tax increments not payable to the Developer to pay administrative costs of the district (up to 10% of TIF). Exhibit B provides estimated tax increment (TIF) cash flow, increased property taxes from the Project, that will be captured to assist the Project. For purposes of the TIF Plan, the property classification for estimating property taxes is assumed at the “4a” classification (Rental Housing 4 or more units). Due to the LIHTC and limitations on rents, the Project may qualify for Class 4d (Qualifying Low Income Rental Property). If the Project is in fact classified as 4d for tax purposes, the estimated real estate taxes payable and therefore the tax increment will be less than is 36 Jufn!6/ TIF District 26 January 18, 2023 Page 3 estimated in Exhibit B and in the TIF Plan. The 4a class is used for purposes of the TIF Plan because the future property classification for purpose of property taxes is uncertain and depending on final facts the Project may or may not qualify. Without assistance the Project will not achieve a return on cost, net operating income divided by total development cost, greater than 6.0% until after year 18 of the TIF District (see Exhibit C). TIF is estimated to be necessary to achieve debt service coverage (greater than 1.2X). Developer compensation on these types of projects is typically the developer fee. It is common for a developer to defer a large portion of the developer fee to make the project work, as is proposed for the Project. The developer fee is paid out of cash flow, so the dollars are “at-risk” for the developer. For an affordable housing project, that does not involve extraordinary costs related to redevelopment of property, such as for this Project, we might typically expect the developer fee to be repaid over a 15-year term. For this Project, we estimate repayment will take longer due to the extraordinary costs of redevelopment, combined with the limitation on rents for affordable units. Use of Tax Increment Financing (TIF) A decision to deny the use of TIF does not necessarily mean that there will be no future improvements on the Property. A decision to approve may be made based on a finding that the Project, as proposed, would not be reasonably expected to occur solely through private investment within the reasonably near future. It does not mean that “no” development, housing or commercial, will occur on the site ever. The analysis shows that an induced development will yield a net increase in taxable market value of approximately $25 million (future value) for the site compared to the likely taxable market value of $2.5 million (future value) without TIF. Summary This memorandum was prepared to assist with evaluation of the request for assistance submitted by the Developer. The assumptions and estimated amounts provided in this memorandum and exhibits are subject to change. The key items to note from the memorandum are as follows: All 168 apartment units to be affordable with income restrictions at 60% of AMI. Income qualifications and rent requirements for the proposed public financing will be met. The public finance tools proposed include tax exempt bonding, 4% LIHTC, and TIF. The Developer has or will be submitting application to the state for the bonding allocation and LIHTC. This assistance is in addition to the request of the HRA to establish a TIF district. The Developer will defer a portion of the developer fee and provide equity in the estimated amount of $9,666,909 or 19.5% of the estimated costs for the Project. The 37 Jufn!6/ TIF District 26 January 18, 2023 Page 4 developer fee and contribution of equity will be repaid from future cash flow from the project with interest. Repayment will be based on net cash flow after debt service payments. The actual term of repayment will depend on the actual net cash flow. Reduction in rental income from either market conditions or an increase in the requirements for level of affordability will extend the term of repayment, among other factors. The Developer may request the HRA to consider approval of assignment of the proposed TIF revenue note to be issued by the HRA to the Developer to a third party. The assignment by the HRA is needed for the Developer to mortgage or leverage the TIF revenue note to provide cash for the Project. Northland’s review suggests the Project, as proposed, is feasible only through assistance, in part from TIF. The TIF assistance is to not exceed $6,126,000 payable over a term not to exceed 26 years. Unpaid principal amount will bear interest from the date of the TIF revenue note at the simple non-compounded rate of 5.0% per annum. The first payment date is to be August 1, 2025, and on each February 1 and August 1 thereafter to and including February 1, 2050. 38 Jufn!6/ TIF District 26 January 18, 2023 Page 5 EXHIBIT A Fridley, MN Fridley - Moon Plaza Developer Sources and Uses for Project Total% of TotalPer Unit Sources Debt$24,670,00049.8%$146,845 Low Income Tax Credit Equity$15,206,52630.7%$90,515 Developer Equity / Deferred Fee$9,666,90919.5%$57,541 Total Sources of Funds$49,543,435100.0%$294,901 Uses Land Acquisition$3,500,0007.1%$20,833 Construction$33,556,63267.7%$199,742 Interim Escrowed Funds$3,931,6097.9%$23,402 Lender/Invester Cash Reserves$911,0641.8%$5,423 Professional Services$1,550,0003.1%$9,226 Construction Financing Costs$564,5791.1%$3,361 Permanent Financing Costs$603,6011.2%$3,593 Closing Costs and Tax Credit Fees$387,9060.8%$2,309 Developer Fee$4,538,0449.2%$27,012 Total Uses of Funds$49,543,435100.0%$294,901 Number of Units168 39 Jufn!6/ TIF District 26 January 18, 2023 Page 6 EXHIBIT B Fridley, MN Tax Increment Financing District No. 26 (Redevelopment) Moon Plaza Projected Tax Increment Financing (TIF) Cash Flow Present TIF Taxes Taxable Captured Tax TIF Original Tax Available TIF Net Value Net District Payable Market Value Capacity for Retained by Ratefrom DistrictAvailable TIFAvailable YearYear(TMV)TIFHRA TIF 1202523,670,036266,307123.78%328,45532,846295,610275,656 2202633,892,821394,092123.78%486,06248,606437,456663,927 3202733,971,486395,075123.78%487,27448,727438,5471,034,411 4202834,050,334396,060123.78%488,49048,849439,6411,387,923 5202934,129,364397,048123.78%489,70948,971440,7381,725,240 6203034,208,579398,038123.78%490,93049,093441,8372,047,104 7203134,287,977399,031123.78%492,15449,215442,9382,354,222 8203234,367,559400,026123.78%493,38149,338444,0432,647,271 9203334,447,326401,023123.78%494,61149,461445,1502,926,895 10203434,527,279402,022123.78%495,84449,584446,2593,193,707 11203534,607,416403,024123.78%497,07949,708447,3713,448,296 12203634,687,740404,028123.78%498,31849,832448,4863,691,221 13203734,768,250405,034123.78%499,55949,956449,6033,923,017 14203834,848,948406,043123.78%500,80350,080450,7224,144,193 15203934,929,832407,054123.78%502,05050,205451,8454,355,235 16204035,010,904408,068123.78%503,30050,330452,9704,556,609 17204135,092,164409,083123.78%504,55350,455454,0984,748,756 18204235,173,613410,101123.78%505,80950,581455,2284,932,100 19204335,255,251411,122123.78%507,06750,707456,3605,107,043 20204435,337,079412,145123.78%508,32850,833457,4965,273,971 21204535,419,096413,170123.78%509,59350,959458,6345,433,250 22204635,501,304414,198123.78%510,86051,086459,7745,585,232 23204735,583,702415,228123.78%512,13151,213460,9185,730,250 24204835,666,292416,260123.78%513,40451,340462,0645,868,624 25204935,749,074417,295123.78%514,68051,468463,2126,000,657 26205035,832,047418,332123.78%515,96051,596464,3646,126,640 TOTAL = 12,850,4031,285,04011,565,3636,126,640 Key Assumptions for TIF Plan and Estimated Available TIF from District: 1 Taxable market value (TMV) annual growth assumption equal to approximately 0.25%. Original Tax Capacity Rate for purpose of the Plan is estimated based on Taxes Payable Year 2022.Certified tax 2 rate will not be known until time of certificatio of the TIF District by the County. 3Election for captured tax capacity is 100.00%. Assumes Property Class = 4a 4Base Tax Capacity is calculated based on a TMV = $2,365,500. 5Present Value (PV) calculated based on semi-annual payments and rate of 4.0%, estimated dated date 6Fiscal Disparities to be paid from outside of the TIF District. Housing is not subject to fiscal disparities. 7Estimates for Taxable Market Value (TMV) are preliminary for planning purposes only, actual amount will vary. 8Available TIF from District is after deducting State Auditor Fee (0.36% 9Analysis is based on the property being classified as 4a. A different property classification, such as 4d will impact the estimated Captured Tax Capacity for TIF and the estimated Available TIF from District. 3: Jufn!6/ TIF District 26 January 18, 2023 Page 7 2/ Total Deferred Developer Fee / Equity:1/ Total Development Cost (TDC):Notes:Deferred Developer Fee Balance7,820,6707,005,4916,075,3275,023,9283,844,7582,530,9851,075,473-Debt coverage without TIFDebt coverage with TIFReturn on Cost without TIFReturn on Cost with TIF Net Cash Flow Debt Service NOI with TIF Plus TIF RevenueNet Operating Income (NOI)2,318,3602,397,9892,479,2382,562, 1362,646,7192,733,0182,821,0682,910,9063,002,5653,096,084Less ExpensesGross Income (before TIF)4,178,5034,262,0734,347,3154,434,2614,522,9464,613,4054,705,6734,799,7874,895,7834,993,698Year of TIF DistrictCalendar YearDeferred Developer Fee Balance9,666,9099,666,9099,666,9099,666,9099,666,9099,666,9099,666,9099,666,9099,666,9099,666,9099,666,9099,666,9099,666,9099,129,7428,526,847Debt coverage without TIFDebt coverage with TIFReturn on Cost without TIFReturn on Cost with TIF Net Cash Flow Debt Service NOI with TIF Plus TIF RevenueNet Operating Income (NOI)1,529,5451,692,7071,738, 0391,776,6751,815,8811,855,6631,896,0261,936,9731,978,5092,020,6382,063,3642,106,6912,150,6232,195,1642,240,315Less ExpensesGross Income (before TIF)2,785,2113,159,2963,230,1193,294,7213,360,6163,427 ,8283,496,3853,566,3123,637,6393,710,3913,784,5993,860,2913,937,4974,016,2474,096,572Year of TIF DistrictCalendar Year 1,143,8692,771,3292,852,0872,934,4653,018,4973,104,2143,191,6513,280,8433,371,8233,464,6293,559,2961,825,1542,130,1632,176,5862,216,3162,256,6192,297,5012,338,9652,381,0162,423,6592,466,8972,510,7352 ,555,1772,600,2262,645,8862,692,160 1,627,4611,627,4621,627,4631,627,4641,627,4651,627,4661,627,4671,627,4681,627,4691,627,4701,860,1441,864,0841,868,0771,872,1251,876,2281,880,3881,884,6051,888,8811,893,2171,897,6151,121,9581,674,1001 ,504,8701,504,8701,576,3811,627,4601,627,4601,627,4601,627,4601,627,4601,627,4601,627,4601,627,4601,627,4601,627,4601,255,6661,466,5891,492,0801,518,0461,544,7341,572,1651,600,3581,629,3401,659,1301, 689,7541,721,2351,753,6001,786,8741,821,0831,856,257 703,197 452,970454,098455,228456,360457,496458,634459,774460,918462,064463,212295,610437,456438,547439,641440,738441,837442,938444,043445,150446,259447,371448,486449,603450,722451,845 1.151.191.241.291.351.401.451.511.561.621.701.751.801.851.911.962.022.072.132.194.7%4.8%5.0%5.2%5.3%5.5%5.7%5.9%6.1%6.2%5.6%5.8%5.9%6.1%6.3%6.4%6.6%6.8%7.0%7.2%204020412042204320442045204620472048204 91.100.750.860.890.870.870.890.920.940.970.991.021.051.071.101.631.271.451.471.431.411.441.461.491.521.541.571.601.631.653.1%3.4%3.5%3.6%3.7%3.7%3.8%3.9%4.0%4.1%4.2%4.3%4.3%4.4%4.5%3.7%4.3%4.4%4.5%4. 6%4.6%4.7%4.8%4.9%5.0%5.1%5.2%5.2%5.3%5.4%202520262027202820292030203120322033203420352036203720382039 16171819202122232425 1 1,224,625 456,063 Summary Pro Forma Based on Information Provided by Developer and Information Prepared by Northland 23 49,543,435 1,307,003 9,666,909 671,716 1,391,033 711,446 4 1,476,749 680,239 Preliminary Estimated Amounts 56 1,564,186 670,041 Moon PlazaFridley, MN EXHIBIT C 1,653,376 711,505 7 1,744,356 753,556 8 1,837,160 796,199 - 9101112131415 1,931,826 839,437 - 883,275 927,717 972,766 1,018,426 1,064,701 41 Jufn!6/ DRAFT MODIFIED AND RESTATED REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO. 1 AND TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT ()() FINANCING REDEVELOPMENT DISTRICT NO. 26 MOON PLAZA WITHIN REDEVELOPMENT PROJECT NO. 1 CITY OF FRIDLEY, MINNESOTA AND FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY PUBLIC HEARING DATE: ________________, 2023 PLAN APPROVED BY HRA DATE: __________________, 2023 PLAN APPROVED BY CITY COUNCIL DATE: __________________,2023 PLAN CERTIFICATION REQUEST DATE: _______________, 2023 PLAN CERTIFIED DATE: ________________, 2023 Northland Securities, Inc. 150 South Fifth Street, Suite 3300 Minneapolis, MN 55402 (800) 851-2920 Member NASD and SIPC Registered with SEC and MSRB 42 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 TABLE OF CONTENTS .........................................................1 Section 1.01 Introduction ......................................................................................1 Section 1.02 .........................................................................................4 Section 1.03 Plan Preparation ...............................................................................5 ...........................5 Section 2.01 Enabling Act; Statutory Authority .................................................5 Section 2.02 Statement and Finding of Public Purpose ....................................6 Section 2.03 Boundaries of Project Area ..............................................................6 .........................................................................6 Section 3.01 Statement of Objectives ...................................................................6 Section 3.02 Development Activities ...................................................................8 Section 3.03 Payment of Public Development Costs .........................................8 Section 3.04 Environmental Controls; Land Use Regulations .........................8 Section 3.05 Park and Open Space to be Created ..............................................8 Section 3.06 Proposed Reuse of Property ...........................................................8 Section 3.07 Administration and Maintenance of Project Area .......................9 Section 3.08 Amendments .....................................................................................9 Section 3.09 Findings and Declaration ................................................................9 .....................................................10 Section 4.01 Statutory Authority ........................................................................10 Section 4.02 Planned Development ...................................................................10 4.02.1 Project Description ....................................................................................10 4.02.2 City Plans and Development Program ..................................................10 4.02.3 Land Acquisition .......................................................................................10 4.02.4 Development Activities ............................................................................10 4.02.5 Need for Tax Increment Financing .........................................................10 Section 4.03 Tax Increment Financing District .................................................11 4.03.1 Designation ................................................................................................11 4.03.2 Boundaries of TIF District ........................................................................11 4.03.3 Type of District ..........................................................................................11 Section 4.04 Plan for Use of Tax Increment ......................................................11 4.04.1 Estimated Tax Increment..........................................................................11 4.04.2 Fiscal Disparities Election ........................................................................12 4.04.3 Public Development Costs .......................................................................12 4.04.4 Estimated Sources and Uses of Funds ...................................................12 Figure 4 Estimated Sources and Uses of Funds ....................................13 4.04.5 Administrative Expense ...........................................................................13 4.04.6 County Road Costs ...................................................................................14 4.04.7 Bonded Indebtedness ...............................................................................14 4.04.8 Duration of TIF District ............................................................................14 4.04.9 Estimated Impact on Other Taxing Jurisdictions .................................14 4.04.10Prior Planned Improvements ..................................................................15 DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 I 43 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 ......................................................15 Section 5.01 ..................................................................15 Section 5.02 ..................15 Section 5.03 4-Year Knockdown Rule ................................................................16 Section 5.04 Pooling/5-Year Rule........................................................................16 Section 5.05 Financial Reporting and Disclosure Requirements ...................16 Section 5.06 Business Subsidy Compliance ......................................................16 ..........................................................................................................................17 Exhibit I Present Value Analysis ..................................................................17 Exhibit II Projected Tax Increment ................................................................18 Exhibit III Impact on Other Taxing Jurisdictions..........................................19 Exhibit IV Estimated Tax Increment Over Life of District ..........................20 Exhibit V Maps of Project Area and TIF Districts .......................................21 Exhibit VI Description of parcels in TIF District ...........................................23 Exhibit VII Report for Redevelopment Findings ...........................................24 DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 II 44 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 ARTICLE I INTRODUCTION AND DEFINITIONS SECTION 1.01 INTRODUCTION This Redevelopment Plan for Redevelopment Project No. 1 of the Fridley Housing and Redevelopment Authority of the City of Fridley is intended to supersede and restate the activities described in the Redevelopment Plan for Redevelopment Project No. 1 as originally establishment of Tax Increment Financing District No. 25 (Holly Center) and the adoption of a Tax Increment Financing Plan. Tax Increment Financing District Nos. 6, 12, 13, 17, 18, 19, 20, 21, 22, 23, 24, 25, and the Housing Replacement TIF District, and the Tax Increment Financing Plans related thereto, within The City of Fridley and the Fridley Housing and Redevelopment Authority (HRA) propose Financing (Redevelopment) District No. 26 within the Redevelopment Project No. 1 to assist 168 unit residential apartment building and related improvements by a private developer. established within its boundaries. The Redevelopment Plan describes the City’s objectives for Redevelopment Project No. 1 through the establishment of a Tax Increment Financing Plan and use of Tax Increment Financing (Redevelopment) District No. 26. Below is a summary of the municipal action that has been taken in connection with Redevelopment Project No. 1 to date and as proposed: Redevelopment Project No. 1: • May 15,1979: A Redevelopment Plan for Center City was adopted. Prior to the enactment originally adopted Redevelopment Plan. • April 6, 1981: A Redevelopment Plan and a Tax Increment Financing Plan were adopted and a Redevelopment Project and Tax Increment Financing District were created for the Moore Lake Redevelopment Area. • November 23, 1981: A Redevelopment Plan and a Tax Increment Financing Plan were adopted and a Redevelopment Project and Tax Increment Financing District were created for the North Area Redevelopment Area. • August 22, 1983 project areas included in the Redevelopment Plans for Moore Lake and North Area and was redesignated as Redevelopment Project No. 1. The Center City Redevelopment Area was redesignated as Tax Increment Financing District No. 1; the Moore Lake Redevelopment Area was redesignated as Tax Increment Financing District No. 2 and the North Area Redevelopment Area was redesignated as Tax Increment Financing • December 19, 1983: The Redevelopment Plan, including its existing Tax Increment No. 4 (Skywood Mall) and the adoption of a Tax Increment Financing Plan. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 1 45 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 • February 27, 1984: The Redevelopment Plan, including its existing Tax Increment No. 5 (Paschke) and the adoption of a Tax Increment Financing Plan. • February 25, 1985: The Redevelopment Plan, including its existing Tax Increment bond and the Tax Increment Financing Plans for Tax Increment Financing Districts Nos. 4 (Skywood Mall) and 5 (Paschke) were incorporated into the Redevelopment Plan. • November 18, 1985: The Redevelopment Plan, including its existing Tax Increment Increment Financing District No. 6 (Lake Pointe) and the adoption of a Tax Increment Financing Plan. • September 22, 1986: The Redevelopment Plan, including its existing Tax Increment Increment Financing Districts Nos. 7 (Rice Creek Business Center) and 8 (Shorewood Inn) and the adoption of Tax Increment Financing Plans. • December 22, 1986: The Redevelopment Plan, including its existing Tax Increment • April 20, 1987: The Redevelopment Plan, including its existing Tax Increment Financing • June 26, 1989: The Redevelopment Plan, including its existing Tax Increment Financing creation of Tax Increment Financing District No. 9 (Old Central/Onan) and the adoption of a Tax Increment Financing Plan. • February 26, 1990: The Redevelopment Plan, including its existing Tax Increment costs, the creation of Tax Increment Financing District No. 10 (Northco Phase 111) and the adoption of a Tax Increment Financing Plan. • July 1, 1991: The Redevelopment Plan, including its existing Tax Increment Financing the creation of Tax Increment Financing District No. 11 (University/Osborne) and the adoption of a Tax Increment Financing Plan. • January 6, 1992: The Redevelopment Plan, including its existing Tax Increment Financing the creation of Tax Increment Financing District No. 12 (McGlynn Bakeries) and the adoption of a Tax Increment Financing Plan. • July 6, 1992: The Redevelopment Plan, including its existing Tax Increment Financing • September 13, 1993: The Redevelopment Plan, including its existing Tax Increment costs. • December 31, 1994: The Redevelopment Plan, including its existing Tax Increment District No. 4 (Skywood Mall). • February 13, 1995: The Redevelopment Plan, including its existing Tax Increment costs, the creation of Tax Increment Financing District No. 13 (Satellite Lane Apartments) and the adoption of a Tax Increment Financing Plan. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 2 46 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 • December 11, 1995: The Redevelopment Plan, including its existing Tax Increment Increment Financing District No. 14 (Industrial Equities Project) and the adoption of a Tax Increment Financing Plan. • December 31, 1995: The Redevelopment Plan, including its existing Tax Increment District No. 5 (Paschke). • December 31, 1996: The Redevelopment Plan, including its existing Tax Increment District No. 8 (Shorewood Inn). • April 28, 1997: The Redevelopment Plan, including its existing Tax Increment Financing creation of Tax Increment Financing Districts Nos. 15 (Commercial Rail Properties, Inc.) and 16 (Linn Property Holdings, LLC) and the adoption of Tax Increment Financing Plans. • December 13, 1999: The Redevelopment Plan, including its existing Tax Increment costs. • December 11, 2000: The Redevelopment Plan, including its existing Tax Increment Increment Financing District No. 17 (Gateway East) and the adoption of a Tax Increment Financing Plan. • December 31, 2000: The Redevelopment Plan, including its existing Tax Increment District No. 10 (Northco Phase III). • April 9, 2001: The Redevelopment Plan, including its existing Tax Increment Financing • June 24, 2002: The Redevelopment Plan, including its existing Tax Increment Financing 15 (Commercial Rail Properties, Inc.). • December 8, 2003: The Redevelopment Plan, including its existing Tax Increment authority. • August 8, 2005: The Redevelopment Plan, including its existing Tax Increment Financing the creation of Tax Increment Financing District No. 18 (Gateway West) and the adoption of a Tax Increment Financing Plan. • February 26, 2007: The Redevelopment Plan, including its existing Tax Increment authority, the creation of Tax Increment Financing District No. 19 (5110 Main Street) and the adoption of a Tax Increment Financing Plan. • April 9, 2012: The Redevelopment Plan, including its existing Tax Increment Financing the creation of Tax Increment Financing District No. 20 (RER/BAE) and the adoption of a Tax Increment Financing Plan; and the creation of Hazardous Substance Subdistrict District No. 20A (RER/BAE HSS Subdistrict) and the adoption of a Tax Increment Financing Plan. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 3 47 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 • October 8, 2012: The Redevelopment Plan, including its existing Tax Increment Financing the creation of Tax Increment Financing District No. 21 (Gateway Northeast TIF District) and the adoption of a Tax Increment Financing Plan. • May 6. 2013: The Redevelopment Plan, including its existing Tax Increment Financing the creation of Tax Increment Financing District No. 22 (Northstar Transit Station District) and the adoption of a Tax Increment Financing Plan. • September 12, 2016: The Redevelopment Plan, including its existing Tax Increment authority, the creation of Tax Increment Financing District No. 23 (Redevelopment Project 2016) and the adoption of a Tax Increment Financing Plan. • June 11, 2018: The Redevelopment Plan, including its existing Tax Increment Financing the creation of Tax Increment Financing District No. 24 (Stacks VIII) and the adoption of a Tax Increment Financing Plan. • September 14, 2020: The Redevelopment Plan, including its existing Tax Increment authority, the creation of Tax Increment Financing District No. 25 (Holly Center) and the adoption of a Tax Increment Financing Plan. • Proposed for February 13, 2023: The Redevelopment Plan, including its existing Tax and increased bonding authority, the creation of Tax Increment Financing District No. 26 (Moon Plaza) and the adoption of a Tax Increment Financing Plan. SECTION 1.02 DEFINITIONS For the purposes of this document, the terms below have the meanings given in this section, 1. “Authority” means the Fridley Housing and Redevelopment Authority of the City. 2. “City” means the City of Fridley, Minnesota. 3. “City Council” means the City Council of the City. 4. “County” means Anoka County, Minnesota. 5. “Developer” means a private party undertaking construction within the TIF District. 6. “Development” means the construction of an approximate 168 unit residential apartment building plus underground and surface parking and associated amenity areas, both indoor and outdoor within the boundaries of the TIF District by the Developer. 7. “Enabling Act” means Minnesota Statutes, Sections 469.001 through 469.047, as amended and supplemented from time to time. 8. “HRA” means the Authority. 9. “Land Use Regulations” means all federal, state and local laws, rules, regulations, ordinances, and plans relating to or governing the use of development of land in the City, including but not limited to environmental, zoning and building code laws and regulations. 10. “Project Area” means the boundaries of the Redevelopment Project. 11. “Project Costs” means Public Development Costs. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 4 48 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 12. “Public Development Costs” means the public development cost of the development activities that will or are expected to occur within the Project Area or within the TIF District. 13. “Redevelopment Plan” means the Redevelopment Plan for the Redevelopment Project, as the same may, from time to time, be amended or supplemented (included within this document in Article III). 14. “Redevelopment Project” means Redevelopment Project No. 1 of the HRA, as the same may, from time to time, be amended or supplemented. 15. “School District” means Independent School District No. 14 (Fridley School District). 16. “State” means the State of Minnesota. 17. “Tax Increment Financing Bonds” means any bonds or other obligations issued pursuant to Minnesota Statutes Section 469.174, Subd. 3, which may include general obligation tax and interfund loans or advances, among other types. 18. established in the future within the Project Area. 19. “Tax Increment Financing Plan” or “Plan” means the plans adopted by the City and HRA for any Tax Increment Financing District. 20. “TIF Act” means Minnesota Statutes, Sections 469.174 through 469.1794, as amended, both inclusive. 21. “TIF District” means Tax Increment Financing (Redevelopment) District No. 26 (Moon Plaza). 22. document in Article IV). SECTION 1.03 PLAN PREPARATION The document was prepared for the City and HRA by Northland Securities, Inc. ARTICLE II STATEMENT OF PUBLIC PURPOSE AND AUTHORITY SECTION 2.01 ENABLING ACT; STATUTORY AUTHORITY Authority and the City, to establish and designate redevelopment projects within the City and to establish, develop and the administer redevelopment plans therefor to meet the needs and In accordance with the purposes set forth in the Enabling Act, the Authority and the City have established the Redevelopment Project comprised of the parcels listed in Exhibit VI and have The Enabling Act and the approval of the Redevelopment Plan by the City authorizes the Authority to undertake redevelopment activities within the Project Area and, at a date approval, to establish and designate Tax Increment Financing Districts within the Project Area and to adopt and implement Tax Increment Financing Plans to accomplish the objective of the Redevelopment Plan. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 5 49 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 SECTION 2.02 STATEMENT AND FINDING OF PUBLIC PURPOSE The Authority has determined that there is a need to take certain actions designed to encourage, ensure and facilitate development and redevelopment of under-utilized and unused land located within the corporate limits of the City. These actions will provide additional employment opportunities for residents of the City and the surrounding area, and improve public services, and improve the general economy of the City, the County, and the State. The Authority has determined that the property within the Project Area is either under- utilized or unused due to a variety of factors, including inadequate public parking to serve the property, small parcels, non-conforming uses, vacant or under-utilized property, possible environmental conditions, obsolete building design and site layout, poor access and parking, and lack of streetscaping and visual appeal that is needed to make this a viable business district. These factors have resulted in a lack of private investment. As a result, the property within the Project Area is not providing adequate employment opportunities, and is not contributing, to its full potential. Therefore, it is necessary for the Authority to exercise its authority under the Enabling Act to develop and implement a program designed to encourage, ensure and facilitate the commercial and mixed use development and redevelopment of the property located in the Project Area, to further and accomplish the desired public purposes for the Project Area as The land in the Project Area would not be developed or redeveloped solely through private investment in the foreseeable future. The welfare of the City, County, and the State of Minnesota commerce by the Authority. SECTION 2.03 BOUNDARIES OF PROJECT AREA The area within the Project Area is described in Exhibit V. The Project Area is inclusive of all immediate adjacent roadways, rights-of-way and other areas wherein will be installed or upgraded the various public improvements necessary for and part of the overall project. the Authority and the City seek to accomplish or encourage with respect to such property, constitutes a “redevelopment project” and a “redevelopment plan” within the meaning of Section 469.002, Subd. 14 and 16 of the Enabling Act. ARTICLE III REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO. 1 SECTION 3.01 STATEMENT OF OBJECTIVES necessary and in the best interests of the City and its residents and is necessary to give the Authority and the City the ability to meet certain public purpose objectives that would not be obtainable in the foreseeable future without intervention by the Authority in the normal development process. through the implementation of the Redevelopment Plan: DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 6 4: Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 1. Promote and secure the development and redevelopment of property in the Project Area in a manner consistent with the City’s planning, and with a minimal adverse impact on the environment, which property is less productive because of the lack of proper utilization and lack of investment, and thereby promoting and securing the development of other land in the City; 2. Promote and secure additional employment opportunities within the Project Area and the City for residents of the City and the surrounding area, thereby improving living standards and preventing unemployment and the loss of skilled and unskilled labor and other human resources in the City; 3. Secure the increase in value of property subject to taxation by the City, School District, public improvements and governmental services and programs required to be provided by them; 4. Secure the construction and providing moneys for the payment of the cost of public improvements in the Project Area, which are necessary for the completion of the 5. Promote a compatible mix of commercial and industrial, institutional, and residential land uses. 6. Encourage the expansion and improvement of local business, and enhancing the economic vitality of existing and new businesses. 7. 8. Provide for adequate streets, utilities, and other public improvements and facilities to enhance the area for both new and existing development. 9. Create a desirable and unique character within the Project Area through quality land use alternatives and design quality in new buildings that create a safe environment for pedestrians, that can be maintained for the long run. 10. Support the physical connection to local trails, open space, and other community institutions. 11. Enhance the integrity of residential neighborhoods adjacent to the Project Area. 12. Provide and secure the development of increased opportunities for families to reside in wide array of services without regard to income, and for residents looking for a wide range of multi-family units. 13. Enhance the long term viability of the Project Area by facilitating: • Land uses that complement and support existing businesses; • New businesses that enhance the commercial market; • Visual quality of the streetscape, landscape, site plan and building types of new developments; • Mixed use housing development where appropriate; and • Safe access and convenient parking. SECTION 3.02 DEVELOPMENT ACTIVITIES activities pursuant to the Enabling Act, the TIF Act and other applicable state laws, and in doing DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 7 51 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 so anticipates that the following may, but are not required, to be undertaken by the Authority: (a) The making of studies, planning, and other formal and informal activities relating to the Redevelopment Plan. (b) The implementation and administration of the Redevelopment Plan. (c) The rezoning of land within the Project Area. (d) The acquisition of property, or interests in property, by purchase or condemnation, which acquisition is consistent with the objectives of the Redevelopment Plan, (e) The preparation of property for use and development in accordance with applicable Land Use Regulations and any development agreements, including demolition of structures, (f) The resale of property to private parties. (g) The construction or reconstruction of improvements as described in the Tax Increment Financing Plans for the Tax Increment Financing Districts within the Project Area. of the Redevelopment Plan, and the use of tax increments or other funds available to the City incurred or to be incurred by it. (i) The use of tax increments to pay debt service on the Tax Increment Financing Bonds or otherwise pay or reimburse with interest the Public Development Costs of the Redevelopment Plan. SECTION 3.03 PAYMENT OF PUBLIC DEVELOPMENT COSTS It is anticipated that the Public Development Costs of the Redevelopment Plan will be paid primarily from proceeds of Tax Increment Financing Bonds or from tax increments from the Tax Increment Financing Districts with the Project Area, among other sources of revenue the Authority may provide for payment of Public Development Costs. SECTION 3.04 ENVIRONMENTAL CONTROLS; LAND USE REGULATIONS All municipal actions, public improvements and private development shall be carried out in a manner consistent with existing environmental controls and all applicable Land Use Regulations. SECTION 3.05 PARK AND OPEN SPACE TO BE CREATED Park and open space within the Project Area, if created, will be created in accordance with the SECTION 3.06 PROPOSED REUSE OF PROPERTY The Redevelopment Plan contemplates that the Authority may acquire property and reconvey the same to another entity. Prior to formal consideration of the acquisition of any property, the Authority will require the execution of a binding development agreement with respect thereto and evidence that tax increments or other funds will be available to pay the Public Development Costs associated with land acquisition. It is the intent of the Authority to negotiate the acquisition of property whenever possible. Appropriate restrictions regarding the reuse and redevelopment of property shall be incorporated into any development agreement to which the Authority is a party. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 8 52 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 SECTION 3.07 ADMINISTRATION AND MAINTENANCE OF PROJECT AREA Maintenance and operation of the Project Area will be the responsibility of the Director of the Authority, who shall serve as administrator of the Project Area. Each year the administrator of the Project Area will submit to the Authority the maintenance and operation budget for the following year. The administrator will administer the Project Area pursuant to the Enabling Act; provided, however, that such powers may only be exercised at the direction of the Authority. No action authorization by the Authority. SECTION 3.08 AMENDMENTS The Authority reserves the right to alter and amend the Redevelopment Plan, subject to the enlarge or reduce the size of the Project Area. SECTION 3.09 FINDINGS AND DECLARATION (a) The land in the Project Area would not be made available for redevelopment without the opportunity consistent with the needs of the locality as a whole, for the redevelopment of the area by private enterprise. (c) The Redevelopment Plan conforms to the general plan for development of the City as a whole. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 9 53 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 ARTICLE IV TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 26 SECTION 4.01 STATUTORY AUTHORITY The TIF District and the TIF Plan are established under the authority of the TIF Act. SECTION 4.02 PLANNED DEVELOPMENT 4.02.1 Project Description The Developer proposes the construction of an approximate 168 unit residential apartment building plus underground and surface parking and associated amenity areas, both indoor and outdoor within the boundaries of the TIF District. 4.02.2 City Plans and Development Program In addition to achieving the objectives of the Redevelopment Plan, the development is consistent with and works to achieve the development objectives of the Authority and the City. The TIF Plan for the TIF District conforms to the general plan for development or redevelopment of the City as a whole. The proposed development plan for the Development in the TIF District has been reviewed by the Planning Commission and the City Council. 4.02.3 Land Acquisition The Authority or the City do not intend to acquire property within the TIF District. 4.02.4 Development Activities As of the date of approval of the TIF Plan, there are no development activities proposed in the TIF Plan that are subject to contracts. 4.02.5 Need for Tax Increment Financing In the opinion of the City, the Development would not reasonably be expected to occur solely through private investment within the foreseeable future and the increased market value of would be less than the increase in the market value estimated to result from the Development after subtracting the present value of the projected tax increments for the maximum duration of • and site improvement and preparation costs to allow for the Developer to proceed with construction of the Development. • A comparative analysis of estimated market values both with and without establishment of the TIF District and the use of tax increments has been performed as described above and is shown in Exhibit I. This analysis indicates that the increase in estimated market value of the Development (less the present value of the projected tax increments for the maximum the establishment of the TIF District. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 10 54 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 SECTION 4.03 TAX INCREMENT FINANCING DISTRICT 4.03.1 Designation This TIF District is designated Tax Increment Financing (Redevelopment) District No. 26 (Moon Plaza). 4.03.2 Boundaries of TIF District The boundaries of the TIF District are depicted in Exhibit V. The TIF District is located adjacent to University Avenue, on the west side, between 61st Ave NE and 63rd Ave NE in Fridley). The boundaries of the TIF District include the following two parcels listed below and the immediate adjacent roads and right of way. 1. 14-30-24-34-0004 2. 14-30-24-34-0005 The description of the two parcels within the TIF District is provided in Exhibit VI. 4.03.3 Type of District The TIF District is established as a “redevelopment” district pursuant to Section 469.174, Subd. 10 of the TIF Act. The property within the TIF District meets the statutory criteria for The Authority contracted with LHB, Inc. to inspect and evaluate property within the TIF District. As summarized in the table below, the TIF District has a coverage calculation of 100%, than 50% of the buildings, not including outbuildings, are structurally substandard, pursuant substandard buildings are reasonably distributed. Exhibit VII includes the “Report of Inspection Procedures and Results for Determining report are summarized as follows: Number of Parcels.............................................................................................................1 Site Area Included (square feet) ...........................................................................158,994 Area of Improved Parcels (square feet) ..............................................................158,994 Percent of Area Improved ........................................................................................100% Number of Parcels with Buildings .................................................................................1 Number of Buildings found Substandard .....................................................................1 Percent of Buildings found Substandard ...............................................................100% SECTION 4.04 PLAN FOR USE OF TAX INCREMENT 4.04.1 Estimated Tax Increment The original net tax capacity of value of the TIF District will be set by the County upon request This amount is estimated based on the most recent published estimated market value of The estimated net tax capacity of the property after completion of the Development (for tax DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 11 55 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 captured tax capacity for the creation of tax increment. The total local tax rate for taxes payable in 2022 is approximately 123.78%. The TIF Plan assumes this rate as the original local tax rate for purposes of estimating future tax increment for the TIF County will certify the original local tax rate that will apply to the TIF District. The original local to the general education levy under Minnesota Statutes section 126C.13, that apply to a property resulting tax capacity rate is the original local tax rate for the life of the TIF District. year 2026) assuming the Development is completed in 2024. The actual tax increment will vary value produced by the Development and the changes in property value and state tax policy over the duration of the TIF District. The City and the Authority elect to retain 100% of the captured tax capacity value for the duration of the TIF district. Exhibit II contains the projected tax increment over the life of the TIF District, including present value of the future tax increments. 4.04.2 Fiscal Disparities Election The Authority hereby elects the method of tax increment computation set forth in Minnesota Statutes, Section 469.177,Subdivision 3, clause (a) if and when commercial/industrial development occurs within the TIF District, which is not anticipated. 4.04.3 Public Development Costs The Authority will use tax increment to pay Public Development Costs. The Authority anticipates the use of tax increment to pay administrative expenses for the TIF District and to reimburse the Developer on a pay-go basis for certain Public Development Costs. A contract costs eligible for reimbursement and the means of disbursing tax increments collected by the Authority to the Developer, including terms for payment. revenue notes, to be issued will be set pursuant to a contract with the Developer. The Authority Development Costs associated with the development in the TIF District. 4.04.4 Estimated Sources and Uses of Funds The estimated sources of revenue, along with the estimated Project Costs of the TIF District, are itemized in Figure 4 on the next page. The City and the Authority reserve the right to administratively adjust the amount of any of the Project Cost items listed in Figure 4, so long as the total Project Costs amount, not including 4.04.5 Administrative Expense The Authority reserves the right to use up to ten percent (10%) of the tax increment revenues distributed from the County, net of any required fees paid to the State and County, to pay administrative costs of the Authority for the TIF District. The Authority may use these monies to pay for and reimburse the Authority for costs of administering the TIF district as allowed by the TIF Act. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 12 56 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 The maximum amount of tax increment revenue planned to pay administrative expense is shown in Figure 4. Anticipated administrative expenses of the TIF District include annual audit of the fund for TIF District, preparation of annual reporting, legal publication of annual report, consulting and legal costs for administration of the development agreement for the TIF District, among other administrative costs that may be incurred. FIGURE 4 ESTIMATED SOURCES AND USES OF FUNDS Fridley HRA Tax Increment Financing District No. 26 Projected Tax Increment Moon Plaza Total Estimated Tax Increment Revenues (from tax increment generated by the district) Tax increment revenues distributed from the county$12,850,000 Interest and investment earnings$200,000 Sales/lease proceeds$0 Market value homestead credit$0 Total Estimated Tax Increment Revenues$13,050,000 Estimated Project/Financing Costs (to be paid or financed with tax increment) Project costs Land/building acquisition$3,500,000 Site improvements/preparation costs$2,500,000 Utilities$0 Other qualifying improvements$0 Construction of affordable housing$0 Administrative costs$1,285,000 Estimated Tax Increment Project Costs$7,285,000 Estimated financing costs Interest expense$5,765,000 Total Estimated Project/Financing Costs to be Paid from Tax Increment$13,050,000 Estimated Financing Total amount of bonds to be issued$7,285,000 4.04.6 County Road Costs The Development will not substantially increase the use of county roads and necessitate the need to use tax increments to pay for county road improvements. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 13 57 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 4.04.7 Bonded Indebtedness The total estimated amount of Tax Increment Financing Bonds to be issued is shown in Figure 4. The issuance of general obligation bonds is not planned. The Authority intends to use tax of Tax Increment Financing Revenue Note, payable solely from tax increments from the TIF District, to reimburse certain Public Development Costs pursuant to a contract with the Developer. costs, under Section 469.176, Subd. 4 of the TIF Act, from the general fund of the Authority or any other fund under which there is legal authority to do so, subject to the following provisions: (a) Not later than 60 days after money is transferred, advanced, or spent, whichever is earliest, the loan or advance must be authorized by resolution of the City or of the Authority, whichever has jurisdiction over the fund from which the advance or loan is authorized. (b) The resolution may generally grant to the City or the Authority the power to make districts. The resolution may be adopted before or after the adoption of the tax increment advance or loan is to be repaid. (c) The terms and conditions for repayment of the loan must be provided in writing. The or 549.09 are from time to time adjusted. Loans or advances may be structured as draw- down or line-of-credit obligations of the lending fund. Subd. 6 of the TIF Act: (1) the amount of any interfund loan or advance made in a calendar year; and (2) any amendment of an interfund loan or advance made in a calendar year. 4.04.8 Duration of TIF District The duration to collect and spend tax increments on eligible purposes is set at the duration of 4.04.9 Estimated Impact on Other Taxing Jurisdictions Exhibits III and IV show the estimated impact on other taxing jurisdictions if the maximum projected retained captured net tax capacity of the TIF District was hypothetically available to the other taxing jurisdictions. The City and the Authority believe that there will be no adverse impact on other taxing jurisdictions during the life of the TIF District, since the Development will not occur without the establishment of the TIF District and the provision of public assistance. A positive impact therein becomes part of the general tax base. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 14 58 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 The City and the Authority anticipate minimal impact of the Development on city-provided services. There will be no borrowing costs to the City or the Authority for the Project. A manageable increase in water and sewer usage is expected. It is anticipated that there may be a 4.04.10 Prior Planned Improvements There have been no building permits issued in the last 18 months in conjunction with any of the properties within the TIF District. The Authority will include this statement with the request for ARTICLE V ADMINISTERING THE TIF DISTRICT SECTION 5.01 FILING AND CERTIFICATION 1. Upon adoption of the TIF Plan by the City and the Authority, the Authority, or its designee, of the State Auditor. 2. The Authority, or its designee, shall request that the County certify the original net tax capacity and net tax capacity rate of the TIF District. To assist the County Auditor in this process, the Authority, or its designee, shall submit copies of this document, inclusive of the TIF Plan, the resolutions of the City and Authority establishing the TIF District and adopting the TIF Plan, and a listing of any prior planned improvements. SECTION 5.02 MODIFICATIONS OF THE TAX INCREMENT FINANCING PLAN The City and the Authority reserve the right to modify the TIF District and the TIF Plan. Under the TIF Act, the following actions can only be approved after satisfying all the necessary Reduction or enlargement in the geographic area of the Development District or the TIF District. Increase in the amount of bonded indebtedness to be incurred. Increase in the amount of capitalized interest. Increase in that portion of the captured net tax capacity to be retained by the Authority. Designation of additional property to be acquired by the City or the Authority. TIF District and (2) the current net tax capacity of the parcels eliminated equals or exceeds the net tax capacity of those parcels in the TIF District’s original net tax capacity, or the City and the Authority agree that the TIF District’s original net tax capacity will be reduced by no more than the current net tax capacity of the parcels eliminated. that reduces or enlarges the geographic area of the TIF District. The geographic area of the TIF the TIF District. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 15 59 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 - SECTION 5.03 4YEAR KNOCKDOWN RULE improvement of an adjacent street, has commenced on a parcel located within the TIF District, then that parcel shall be excluded from the TIF District and the original net tax capacity shall be of a new street, relocation of a street, or substantial reconstruction or rebuilding of an existing evidence that the required activity has taken place for each parcel in the TIF District. If a parcel is excluded from the TIF District and the City, Authority, or owner of the parcel subsequently commences any of the above activities, the Authority shall certify to the County Auditor that such activity has commenced and the parcel shall once again be included in the TIF District. The County Auditor shall certify the net tax capacity of the parcel, as most recently of the TIF District. - SECTION 5.04 POOLING/5YEAR RULE It is not anticipated that tax increments will be spent outside the TIF District (except allowable administrative expenses), but such expenditures are expressly authorized in the TIF Plan. SECTION 5.05 FINANCIAL REPORTING AND DISCLOSURE REQUIREMENTS The Authority will comply with the annual reporting requirements of state law pursuant to the submit a report on the TIF district on or before August 1 of each year. The Authority must also annually publish in a newspaper of general circulation in the City an annual statement for each The reporting and disclosure requirements outlined in this section begin with the year the and all tax increments have been spent or returned to the county for redistribution. Failure to of distribution of tax increment. SECTION 5.06 BUSINESS SUBSIDY COMPLIANCE Statutes, Sections 116J.993 to 116J.995, as amended. The Development is for a housing project and therefore the Authority anticipates that the business subsidy requirements will not apply. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 16 5: Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Exhibit I Fridley HRA Tax Increment Financing District No. 26 Present Value Analysis As Required By Section 469.175(3)(2) of the TIF Act 1 1 Estimated Future Market Value w/ Tax Increment Financing35,832,047 2 Payable 2022 Market Value2,365,500 3 Market Value Increase (1-2)33,466,547 4 Present Value of Future Tax Increments7,640,455 5 Market Value Increase Less PV of Tax Increments25,826,093 1 6 Estimated Future Market Value w/o Tax Increment Financing2,506,650 7 Payable 2022 Market Value2,365,500 8 Market Value Increase (6-7)141,150 2 9 Increase in MV From TIF25,684,943 1 Assume approximately 0.25% annual appreciation over 26 year life of district. 2 Statutory compliance achieved if increase in market value from TIF (Line 9) is greater than or equal to zero. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 17 61 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Exhibit II Fridley, MN Tax Increment Financing District No. 26 (Redevelopment) Moon Plaza Projected Tax Increment Financing (TIF) Cash Flow TIF Taxes Original Captured Tax Taxable Market Original Tax Available TIF District Payable Tax CapacityBase Tax Capacity for PV Available TIF Value (TMV)Ratefrom District YearYearCapacityTIF 1202523,670,036295,87529,569266,307123.78%328,455310,549 2202633,892,821423,66029,569394,092123.78%486,062752,267 3202733,971,486424,64429,569395,075123.78%487,2741,177,892 4202834,050,334425,62929,569396,060123.78%488,4901,588,010 5202934,129,364426,61729,569397,048123.78%489,7091,983,186 6203034,208,579427,60729,569398,038123.78%490,9302,363,965 7203134,287,977428,60029,569399,031123.78%492,1542,730,869 8203234,367,559429,59429,569400,026123.78%493,3813,084,406 9203334,447,326430,59229,569401,023123.78%494,6113,425,061 10203434,527,279431,59129,569402,022123.78%495,8443,753,304 11203534,607,416432,59329,569403,024123.78%497,0794,069,588 12203634,687,740433,59729,569404,028123.78%498,3184,374,347 13203734,768,250434,60329,569405,034123.78%499,5594,668,001 14203834,848,948435,61229,569406,043123.78%500,8034,950,955 15203934,929,832436,62329,569407,054123.78%502,0505,223,600 16204035,010,904437,63629,569408,068123.78%503,3005,486,309 17204135,092,164438,65229,569409,083123.78%504,5535,739,446 18204235,173,613439,67029,569410,101123.78%505,8095,983,359 19204335,255,251440,69129,569411,122123.78%507,0676,218,383 20204435,337,079441,71329,569412,145123.78%508,3286,444,844 21204535,419,096442,73929,569413,170123.78%509,5936,663,052 22204635,501,304443,76629,569414,198123.78%510,8606,873,308 23204735,583,702444,79629,569415,228123.78%512,1317,075,902 24204835,666,292445,82929,569416,260123.78%513,4047,271,114 25204935,749,074446,86329,569417,295123.78%514,6807,459,211 26205035,832,047447,90129,569418,332123.78%515,9607,640,455 TOTAL = 12,850,4037,640,455 Key Assumptions for TIF Plan and Estimated Available TIF from District: 1 Taxable market value (TMV) annual growth assumption equal to approximately 0.25%. 2 Original Tax Capacity Rate for purpose of the Plan is estimated based on Taxes Payable Year 2022.Certified tax rate will not be known until time of certification of the TIF District by the County. 3Election for captured tax capacity is 100.00%. Assumes Property Class = 4a 4Base Tax Capacity is calculated based on a TMV = $2,365,500. 5Present Value (PV) calculated based on semi-annual payments and rate of 4.0%, estimated dated date 6/1/2024. 6Fiscal Disparities to be paid from outside of the TIF District. Housing is not subject to fiscal disparities. 7Estimates for Taxable Market Value (TMV) are preliminary for planning purposes only, actual amount will vary. 8Available TIF from District is after deducting State Auditor Fee (0.36% of tax increment from property). 9Analysis is based on the property being classified as 4a. A different property classification, such as 4d will impact the estimated Captured Tax Capacity for TIF and the estimated Available TIF from District. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 18 62 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Exhibit III Fridley HRA Tax Increment Financing District No. 26 Impact on Other Taxing Jurisdictions (Taxes Payable 2022) Annual Tax Increment Estimated Annual Captured Tax Capacity (Full Development)$418,332 Payable 2022 Local Tax Rate123.783% Estimated Annual Tax Increment$517,824 Percent of Tax Base Net Tax Captured Percent of Capacity Tax Total NTC (NTC)Capacity Fridley, MN44,207,182418,3320.95% Anoka County464,194,710418,3320.09% ISD 1419,839,680418,3322.11% Dollar Impact of Affected Taxing Jurisdictions Net Tax Tax Added Local Capacity % of TotalIncrement Tax Rate (NTC)Share Fridley, MN45.242%36.549%189,2620.428% Anoka County29.605%23.917%123,8470.027% ISD 1443.699%35.303%182,8070.921% Other5.237%4.231%21,908 Totals123.783%100.000%517,824 NOTE NO. 1: Assuming that ALL of the captured tax capacity would be available to all taxing jurisdictions even if the City does not create the Tax Increment District, the creation of the District will reduce tax capacities and increase the local tax rate as illustrated in the above tables. NOTE NO. 2: Assuming that NONE of the captured tax capacity would be available to the taxing jurisdiction if the City did not create the Tax Increment District, then the plan has virtually no initial effect on the tax capacities of the taxing jurisdictions. However, once the District is established, allowable costs paid from the increments, and the District is terminated, all taxing jurisdictions will experience an increase in their tax base. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 19 63 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Exhibit IV Fridley, MN Tax Increment Financing (Redevelopment) District No. 26 Estimated Tax Increments Over Maximum Life of District Based on Pay 2022 Tax Rate =123.783%45.242%29.605%43.699%5.237% NewEstimatedCityCountySchoolOther TIFTaxesTaxableNewBaseCapturedTotalTIFTIFTIFTIF DistrictPayableMarketTaxTaxTaxTaxRelatedRelatedRelatedRelated YearYearValueCapacityCapacityCapacityIncrementsShareShareShareShare 1202523,670,036295,87529,569266,307329,642120,48278,840116,37313,947 2202633,892,821423,66029,569394,092487,818178,295116,671172,21420,638 3202733,971,486424,64429,569395,075489,035178,740116,962172,64420,689 4202834,050,334425,62929,569396,060490,255179,186117,254173,07420,741 5202934,129,364426,61729,569397,048491,478179,633117,546173,50620,793 6203034,208,579427,60729,569398,038492,704180,081117,839173,93920,845 7203134,287,977428,60029,569399,031493,932180,530118,133174,37320,896 8203234,367,559429,59429,569400,026495,164180,980118,428174,80720,949 9203334,447,326430,59229,569401,023496,398181,431118,723175,24321,001 10203434,527,279431,59129,569402,022497,635181,883119,019175,68021,053 11203534,607,416432,59329,569403,024498,875182,336119,315176,11721,107 12203634,687,740433,59729,569404,028500,118182,790119,612176,55621,160 13203734,768,250434,60329,569405,034501,364183,246119,910176,99621,212 14203834,848,948435,61229,569406,043502,612183,702120,209177,43721,264 15203934,929,832436,62329,569407,054503,864184,159120,508177,87921,318 16204035,010,904437,63629,569408,068505,118184,618120,808178,32121,371 17204135,092,164438,65229,569409,083506,376185,077121,109178,76521,425 18204235,173,613439,67029,569410,101507,636185,538121,411179,21021,477 19204335,255,251440,69129,569411,122508,899186,000121,713179,65621,530 20204435,337,079441,71329,569412,145510,165186,463122,015180,10321,584 21204535,419,096442,73929,569413,170511,434186,926122,319180,55121,638 22204635,501,304443,76629,569414,198512,706187,391122,623181,00021,692 23204735,583,702444,79629,569415,228513,981187,857122,928181,45021,746 24204835,666,292445,82929,569416,260515,259188,324123,234181,90121,800 25204935,749,074446,86329,569417,295516,540188,792123,540182,35421,854 26205035,832,047447,90129,569418,332517,824189,262123,847182,80721,908 Total 12,896,8324,713,7223,084,5164,552,956545,638 Note: The Estimated Total Tax Increment shown above is before deducting the State Auditor's fee, which is payable at a rate of 0.36% of the Total Tax Increment collected. Exhibit II provides Estimated Total Tax Increment after deducting for the State Auditor's fee. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 20 64 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 EXHIBIT V Boundaries of Redevelopment Project No. 1 and Boundaries of TIF District No. 26 Redevelopment Project Area and Tax Increment Financing Districts O SBORNE R D NE 63RD AVE 6299 6279 350 6257 6200 MISSISSIP PI ST NE 6120 694 § ¨¦ 694 § ¨¦ Sfefwfmpqnfou!Qspkfdu!Bsfb jo!xijdi!Uby!Jodsfnfou!nbz cf!Tqfou Qspqptfe!UJG!Ejtusjdu!$37!jo xijdi!Uby!Jodsfnfou!nbz!cf Hfofsbufe 11/361/62 Njmft DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 21 65 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 EXHIBIT V - continued Boundaries of Redevelopment Project No. 1 and Existing TIF Districts within Boundaries DRAFT FOR HRA MEETING, FEBRUARY 2, 202322 66 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 EXHIBIT VI Description of Parcels within Tax Increment Financing District No. 26 DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 23 67 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 EXHIBIT VII Increment Financing District Prepared by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 24 68 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 SFQPSU!PG!JOTQFDUJPO!QSPDFEVSFT!BOE!SFTVMUT GPS EFUFSNJOJOH!RVBMJGJDBUJPOT PG!B UBY!JODSFNFOU!GJOBODJOH!EJTUSJDU NPPO!QMB\[B SFEFWFMPQNFOU!UJG!EJTUSJDU! Qsfqbsfe!gps DJUZ!PG!GSJEMFZ-!NJOOFTPUB Efdfncfs!34-!3133 DRAFT FOR HRA MEETING, FEBRUARY 2, 202325 69 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Ubcmf!pg!Dpoufout! Qbsu!2;!Fyfdvujwf!Tvnnbsz!//////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////!3 Purpose of the Evaluation ........................................................................................................................................................ 2 Scope of Work ......................................................................................................................................................................... 2 Conclusion ............................................................................................................................................................................... 3 Qbsu!3;!Njooftpub!Tubuvuf!57:/285-!Tvcejwjtjpo!21!Sfrvjsfnfout!///////////////////////////////////////////////////////////////////////!4 Interior Inspection .................................................................................................................................................................... 3 Exterior Inspection and Other Means ...................................................................................................................................... 3 Documentation ......................................................................................................................................................................... 3 Qualification Requirements ...................................................................................................................................................... 3 1. Coverage Test .................................................................................................................................................................... 3 2. Condition of Buildings Test ................................................................................................................................................. 4 3. Distribution of Substandard Buildings ................................................................................................................................. 5 Report by LHB, Inc. Qbsu!4;!Qspdfevsft!Gpmmpxfe!////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////!6 Qbsu!5;!Gjoejoht!/////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////!6 1. Coverage Test ..................................................................................................................................................................... 5 2. Condition of Building Test .................................................................................................................................................... 6 3. Distribution of Substandard Structures ................................................................................................................................ 8 Qbsu!6;!Ufbn!Dsfefoujbmt!//////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////!: Bqqfoejdft!////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////!: BQQFOEJY!B!Property Condition Assessment Summary Sheet BQQFOEJY!C!Building Code, Condition Deficiency and Context Analysis Reports BQQFOEJY!D!!Building Replacement Cost Reports Code Deficiency Cost Reports Photographs Moon Plaza Redevelopment TIF District LHB Project No. 221327.00 Page 1 of 9Final Report DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 26 6: Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Qbsu!2;!Fyfdvujwf!Tvnnbsz! Qvsqptf!pg!uif!Fwbmvbujpo! LHB was hired by the City of Fridley to inspect and evaluate the properties within a Tax Increment Financing Redevelopment District (“TIF District”) proposed to be established by the City. The proposed TIF District is located at 6257 University Avenue NE in Fridley, MN (Diagram 1). The purpose of LHB’s work is to determine whether the proposed TIF District meets the statutory requirements for coverage, and whether one (1) building on two (2) parcels, located within the proposed TIF District, meets the qualifications required for a Redevelopment District. Report by LHB, Inc. Ejbhsbn!2;!Qspqptfe!UJG!Ejtusjdu! Tdpqf!pg!Xpsl! The proposed TIF District consists of two (2) parcels with one (1) structure. The building was inspected on November 30, 2022. Building Code and Condition Deficiency reports are in Appendix B. Moon Plaza Redevelopment TIF District LHB Project No. 221327.00 Page 2 of 9Final Report DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 27 71 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Dpodmvtjpo After inspecting and evaluating the properties within the proposed TIF District and applying current statutory criteria for a Redevelopment District under Minnesota Statutes, Section 469.174, Subdivision 10, it is our professional opinion that the proposed TIF District qualifies as a Redevelopment District because: The proposed TIF District has a coverage calculation of 100 percent which is above the 70 percent requirement. 100 percent of the buildings are structurally substandard which is above the 50 percent requirement. The substandard buildings are reasonably distributed. The remainder of this report describes our process and findings in detail. Qbsu!3;!Njooftpub!Tubuvuf!57:/285-!Tvcejwjtjpo!21! Sfrvjsfnfout The properties were inspected in accordance with the following requirements under Minnesota Statutes, Section 469.174, Subdivision 10(c), which states: Joufsjps!Jotqfdujpo! “The municipality may not make such determination \[that the building is structurally substandard\] without an interior Report by LHB, Inc. inspection of the property...” Fyufsjps!Jotqfdujpo!boe!Puifs!Nfbot! “An interior inspection of the property is not required, if the municipality finds that (1) the municipality or authority is unable to gain access to the property after using its best efforts to obtain permission from the party that owns or controls the property; and (2) the evidence otherwise supports a reasonable conclusion that the building is structurally substandard.” Epdvnfoubujpo “Written documentation of the findings and reasons why an interior inspection was not conducted must be made and retained under section 469.175, subdivision 3(1).” Rvbmjgjdbujpo!Sfrvjsfnfout! Minnesota Statutes, Section 469.174, Subdivision 10 (a) (1) requires three tests for occupied parcels: 2/!DPWFSBHF!UFTU! a.Minnesota Statutes, Section 469.174, Subdivision 10(a)(1) states: “parcels consisting of 70 percent of the area of the district are occupied by buildings, streets, utilities, or paved or gravel parking lots…”The coverage required by the parcel to be considered occupied is defined under Minnesota Statutes, Section 469.174, Subdivision 10(e), which states: “For purposes of this subdivision, a parcel is not occupied by buildings, streets, utilities, paved or gravel parking lots, or other similar structures unless 15 percent of the area of the parcel contains buildings, streets, utilities, paved or gravel parking lots, or other similar structures.” Moon Plaza Redevelopment TIF District LHB Project No. 221327.00 Page 3 of 9Final Report DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 28 72 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 3/!DPOEJUJPO!PG!CVJMEJOHT!UFTU! a.Minnesota Statutes, Section 469.174, Subdivision 10(a) states: “…and more than 50 percent of the buildings, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance;” b.Structurally substandard is defined under Minnesota Statutes, Section 469.174, Subdivision 10(b), which states: “For purposes of this subdivision, ‘structurally substandard’ shall mean containing defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance.” i.We do not count energy code deficiencies toward the thresholds required by Minnesota Statutes, Section 469.174, Subdivision 10(b) defined as “structurally substandard”, due to concerns expressed by the State of Minnesota Court of Appeals in the Walser Auto Sales, Inc. vs. City of Richfield case filed November 13, 2001. c.Buildings are not eligible to be considered structurally substandard unless they meet certain additional criteria, as set forth in Subdivision 10(c) which states: “A building is not structurally substandard if it follows the building code applicable to new buildings or could be modified to satisfy the building code at a cost of less than 15 percent of the cost of constructing a new structure of the same square footage and type on the site. The municipality may find that a building is not disqualified as structurally substandard under the preceding sentence based on reasonably available evidence, such as the size, type, and age of the building, the average cost of plumbing, electrical, or structural repairs, or other similar reliable evidence.” Report by LHB, Inc. “Items of evidence that support such a conclusion \[that the building is not disqualified\] include recent fire or police inspections, on-site property tax appraisals or housing inspections, exterior evidence of deterioration, or other similar reliable evidence.” i.LHB counts energy code deficiencies toward the 15 percent code threshold required by Minnesota Statutes, Section 469.174, Subdivision 10(c)) for the following reasons: 1)The Minnesota energy code is one of ten building code areas highlighted by the Minnesota Department of Labor and Industry website where minimum construction standards are required by law. 2)Chapter 13 of the 2015 Minnesota Building Code states, “Buildings shall be designed and constructed in accordance with the International Energy Conservation Code.” Furthermore, Minnesota Rules, Chapter 1305.0021 Subpart 9 states, “References to the International Energy Conservation Code in this code mean theMinnesota Energy Code…” 3)Chapter 11 of the 2015 Minnesota Residential Code incorporates Minnesota Rules, Chapters, 1322 and 1323 Minnesota Energy Code. 4)The Senior Building Code Representative for the Construction Codes and Licensing Division of the Minnesota Department of Labor and Industry confirmed that the Minnesota Energy Code is being enforced throughout the State of Minnesota. 5)In a January 2002 report to the Minnesota Legislature, the Management Analysis Division of the Minnesota Department of Administration confirmed that the construction cost of new buildings complying with the Minnesota Energy Code is higher than buildings built prior to the enactment of the code. 6)Proper TIF analysis requires a comparison between the replacement value of a new building built under current code standards with the repairs that would be necessary to bring the existing building up to current code standards. For an equal comparison to be made, all applicable code chapters should be applied to both scenarios. Since current construction estimating software automatically applies the construction cost of complying with the Minnesota Energy Code, energy code deficiencies should also be identified in the existing structures. Moon Plaza Redevelopment TIF District LHB Project No. 221327.00 Page 4 of 9Final Report DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 29 73 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 4/EJTUSJCVUJPO!PG!TVCTUBOEBSE!CVJMEJOHT a.Minnesota Statutes, Section 469.174, Subdivision 10, defines a Redevelopment District and requires one or more of the following conditions “reasonably distributed throughout the district.”: “(1) Parcels consisting of 70 percent of the area of the district are occupied by buildings, streets, utilities, paved or gravel parking lots, or other similar structures and more than 50 percent of the buildings, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance; (2)the property consists of vacant, unused, underused, inappropriately used, or infrequently used rail yards, rail storage facilities, or excessive or vacated railroad rights-of-way; (3)tank facilities, or property whose immediately previous use was for tank facilities…” b.Our interpretation of the distribution requirement is that the substandard buildings must be reasonably distributed throughout the district as compared to the location of all buildings in the district. For example, if all the buildings in a district are located on one half of the area of the district, with the other half occupied by parking lots (meeting the required 70 percent coverage for the district), we would evaluate the distribution of the substandard buildings compared with only the half of the district where the buildings are located. If all the buildings in a district are located evenly throughout the entire area of the district, the substandard buildings must be reasonably distributed throughout the entire area of the district. We believe this is consistent with the opinion expressed by the State of Minnes ota Court of Appeals in the Walser Auto Sales, Inc. vs. City of Richfield case filed November 13, 2001. Report by LHB, Inc. Qbsu!4;!Qspdfevsft!Gpmmpxfe! LHBinspected one building on the interior and exterior during the day of November 30, 2022. Qbsu!5;!Gjoejoht! 2/Dpwfsbhf!Uftu a.The total square foot area of the parcels in the proposed TIF District were obtained from City records, GIS mapping and site verification. b.The total square foot area of buildings and site improvements on the parcels in the proposed TIF District were obtained from City records, GIS mapping and site verification. c.The percentage of coverage for each parcel in the proposed TIF District was computed to determine if the 15 percent minimum requirement was met. The total square footage of parcels meeting the 15 percent requirement was divided into the total square footage of the entire district to determine if the 70 percent requirement was met. GJOEJOH The proposed TIF District met the coverage test under Minnesota Statutes, Section 469.174, Subdivision 10(e), which resulted in parcels consisting of 100 percent of the area of the proposed TIF District being occupied by buildings, streets, utilities, paved or gravel parking lots, or other similar structures (Diagram 2). This exceeds the 70 percent area coverage requirement for the proposed TIF District under Minnesota Statutes, Section 469.174, Subdivision (a) (1). Moon Plaza Redevelopment TIF District LHB Project No. 221327.00 Page 5 of 9Final Report DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 30 74 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. Ejbhsbn!3!!Dpwfsbhf!Ejbhsbn! Shaded area depicts a parcel more than 15 percent occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures 3/!Dpoejujpo!pg!Cvjmejoh!Uftu! b/CVJMEJOH!JOTQFDUJPO! i.The first step in the evaluation process is the building inspection. After an initial walk-thru, the inspector makes a judgment whether a building “appears” to have enough defects or deficiencies of sufficient total significance to justify substantial renovation or clearance. If it does, the inspector documents with notes and photographs code and non-code deficiencies in the building. c/SFQMBDFNFOU!DPTU! i.The second step in evaluating a building to determine if it is substandard to a degree requiring substantial renovation or clearance is to determine its replacement cost. This is the cost of constructing a new structure of the same square footage and type on site. Replacement costs were researched using R.S. Means Cost Works square foot models for 2022. Moon Plaza Redevelopment TIF District LHB Project No. 221327.00 Page 6 of 9Final Report DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 31 75 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 ii.A replacement cost was calculated by first establishing building use (office, retail, residential, etc.), building construction type (wood, concrete, masonry, etc.), and building size to obtain the appropriate median replacement cost, which factors in the costs of construction in Fridley, Minnesota. iii.Replacement cost includes labor, materials, and the contractor’s overhead and profit. Replacement costs do not include architectural fees, legal fees or other “soft” costs not directly related to construction activities. Replacement cost for each building is tabulated in Appendix A. d/DPEF!EFGJDJFODJFT! i.The next step in evaluating a building is to determine what code deficiencies exist with respect to such building. Code deficiencies are those conditions for a building which are not in compliance with current building codes applicable to new buildings in the State of Minnesota. ii.Minnesota Statutes, Section 469.174, Subdivision 10(c), specifically provides that a building cannot be considered structurally substandard if its code deficiencies are not at least 15 percent of the replacement cost of the building. As a result, it was necessary to determine the extent of code deficiencies for each building in the proposed TIF District. iii.The evaluation was made by reviewing all available information with respect to such buildings contained in City Building Inspection records and making interior and exterior inspections of the buildings. LHB utilizes the current Minnesota State Building Code as the official code for our evaluations. The Minnesota State Building Code is a series of provisional codes written specifically for Minnesota only requirements, adoption of several international codes, and amendments to the adopted international codes. iv.After identifying the code deficiencies in each building, we used R.S. Means Cost Works 2022; Unit and Assembly Costs to determine the cost of correcting the identified deficiencies. We were then able to compare the correction costs with the replacement cost of each building to determine if the costs for correcting code deficiencies meet the required 15 percent threshold. Report by LHB, Inc. GJOEJOH One (1) out of one (1) buildings (100 percent) in the proposed TIF District contained code deficiencies exceeding the 15 percent threshold required by Minnesota Statutes, Section 469.174, Subdivision 10(c). Building Code, Condition Deficiency and Context Analysis reports for the buildings in the proposed TIF District can be found in Appendix B of this report. e/TZTUFN!DPOEJUJPO!EFGJDJFODJFT! i.If a building meets the minimum code deficiency threshold under Minnesota Statutes, Section 469.174, Subdivision 10(c), then for such building to be “structurally substandard” under Minnesota Statutes, Section 469.174, Subdivision 10(b), the building’s defects, or deficiencies should be of sufficient total significance to justify “substantial renovation or clearance.” Based on this definition, LHB re-evaluated each of the buildings that met the code deficiency threshold under Minnesota Statutes, Section 469.174, Subdivision 10(c), to determine if the total deficiencies warranted “substantial renovation or clearance” based on the criteria we outlined above. ii.System condition deficiencies are a measurement of defects or substantial deterioration in site elements, structure, exterior envelope, mechanical and electrical components, fire protection and emergency systems, interior partitions, ceilings, floors, and doors. iii.The evaluation of system condition deficiencies was made by reviewing all available information contained in City records and making interior and exterior inspections of the buildings. LHB only identified system condition deficiencies that were visible upon our inspection of the building or contained in City records. We did not consider the amount of “service life” used up for a particular component unless it was an obvious part of that component’s deficiencies. iv.After identifying the system condition deficiencies in each building, we used our professional judgment to determine if the list of defects or deficiencies is of sufficient total significance to justify “substantial renovation or clearance.” Moon Plaza Redevelopment TIF District LHB Project No. 221327.00 Page 7 of 9Final Report DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 32 76 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 GJOEJOH In our professional opinion, one (1) out of one (1) buildings (100 percent) in the proposed TIF District are structurally substandard to a degree requiring substantial renovation or clearance, because of defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance. This exceeds the 50 percent requirement of Subdivision 10a(1). 4/Ejtusjcvujpo!pg!Tvctuboebse!Tusvduvsft e.Much of this report has focused on the condition of individual buildings as they relate to requirements identified by Minnesota Statutes, Section 469.174, Subdivision 10. It is also important to look at the distribution of substandard buildings throughout the geographic area of the proposed TIF District (Diagram 3). GJOEJOH The parcels with substandard buildings are reasonably distributed compared to all parcels that contain buildings. Report by LHB, Inc. Ejbhsbn!4!!Tvctuboebse!Cvjmejoht! Shaded yellow area depicts parcels with buildings. Shaded orange area depicts substandard buildings. Moon Plaza Redevelopment TIF District LHB Project No. 221327.00 Page 8 of 9Final Report DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 33 77 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Qbsu!6;!Ufbn!Dsfefoujbmt! Njdibfm!B/!Gjtdifs-!BJB-!MFFE!BQ!.!Qspkfdu!Qsjodjqbm0UJG!Bobmztu! Michael has 34 years of experience as project principal, project manager, project designer and project architect on planning, urban design, educational, commercial, and governmental projects. He has become an expert on Tax Increment Finance District analysis assisting over 100 cities with strategic planning for TIF Districts. He is an Architectural Principal at LHB and currently leads the Minneapolis office. Michael completed a two-year Bush Fellowship, studying at MIT and Harvard in 1999, earning master’s degrees in City Planning and Real Estate Development from MIT. He has served on more than 50 committees, boards, and community task forces, including a term as a City Council President, Chair of a Metropolitan Planning Organization, and Chair of the Edina Planning Commission. Most recently, he served as a member of the Edina city council and Secretary of the Edina HRA. Michael has also managed and designed several award-winning architectural projects and was one of four architects in the Country to receive the AIA Young Architects Citation in 1997. Qijm!Gjtifs!!Jotqfdups! For 35 years, Phil Fisher worked in the field of Building Operations in Minnesota including White Bear Lake Area Schools. At the University of Minnesota, he earned his Bachelor of Science in Industrial Technology. He is a Certified Playground Safety Inspector, Certified Plant Engineer, and is trained in Minnesota Enterprise Real Properties (MERP) Facility Condition Assessment (FCA). His FCA training was recently applied to the Minnesota Department of Natural Resources Facilities Report by LHB, Inc. Condition Assessment project involving over 2,000 buildings. Bqqfoejdft BQQFOEJY!B!Property Condition Assessment Summary Sheet BQQFOEJY!C!Building Code, Condition Deficiency and Context Analysis Report BQQFOEJY!D!!Building Replacement Cost Report Code Deficiency Cost Report Photographs Moon Plaza Redevelopment TIF District LHB Project No. 221327.00 Page 9 of 9Final Report DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 34 78 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 BQQFOEJY!B Property Condition Assessment Summary Sheet Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 35 79 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 36 7: Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 BQQFOEJY!C Building Code, Condition Deficiency and Context Analysis Report Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 37 81 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Nppo!Qmb{bSfefwfmpqnfou!UJG!Ejtusjdu Building Code, Condition Deficiency and Context Analysis Report Qbsdfm!BNppo!Qmb{b Address:6257 University Avenue Northeast, Fridley, Minnesota 55432 Parcel ID:14-30-24-34-0004 Inspection Date(s) & Time(s):November 30, 2022, 9:45 am Inspection Type:Interior and Exterior Summary of Deficiencies:It is our professional opinion that this building is Substandard because: -Substantial renovation is required to correct Conditions found. -Building Code deficiencies total more than 15% of replacement cost, NOT including energy code deficiencies. Estimated Replacement Cost:$5,427,246 Estimated Cost to Correct Building Code Deficiencies:$1,927,420 Percentage of Replacement Cost for Building Code Deficiencies:35.5% Report by LHB, Inc. EFGFDUT!JO!TUSVDUVSBM!FMFNFOUT 1.Steel lintels should be protected from rusting per code. DPNCJOBUJPO!PG!EFGJDJFODJFT 1.Essential Utilities and Facilities a.Restrooms are not fully code compliant for accessibility. b.There is no code required access to all levels of the building. 2.Light and Ventilation a.Electrical wiring does not comply with code. b.Electrical circuit panels should be properly protected per code. c.Lighting does not comply with code. d.The HVAC system does not comply with code. 3.Fire Protection/Adequate Egress a.Thresholds do not comply with code for maximum height. b.Interior and exterior stairs do not comply with code. c.Smoke detectors do not comply with code. d.Emergency lighting does not comply with code. e.There is no code required emergency notification system in the building. f.Exit signage does not comply with code. g.Building sprinkler system is not fully code compliant. Moon Plaza Redevelopment TIF DistrictPage 1of 3Building Report LHB Project No.221327.00Parcel A –6257 University Ave NE, Fridley, MN 55432 DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 38 82 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 h.Flooring material is damaged creating and impedimentto emergency egress which is contrary to code. i.Door hardware does not comply with code. j.Concrete sidewalks are damaged creating an impediment to emergency egress which is contrary to code. k.Code required fire caulking should be placed in all through wall, floor, and ceiling penetrations. l.Glass doors should have code required 10-inch kick plates installed. 4.Layout and Condition of Interior Partitions/Materials a.Carpeting is worn/stained and should be cleaned/replaced. b.Ceiling tile is stained and should be replaced. c.Walls should be repaired/repainted. d.Mold is present in the lower level of the building. 5.Exterior Construction a.Roofing material is failing allowing for water intrusion which is contrary to code. b.Hollow metal doors and frames are rusting and should be repaired/repainted. c.Wood fascia should be repainted. d.Windows are failing allowing for water intrusion which is contrary to code. e.Exterior concrete block is damaged/missing allowing for water intrusion which is contrary to code. f.Expansion joint caulking is failing allowing for water intrusion which is contrary to code. Report by LHB, Inc. EFTDSJQUJPO!PG!DPEF!EFGJDJFODJFT 1.Steel lintels should be protected from rusting per code. 2.Restrooms should be modified to comply with accessibility code. 3.A code required accessible route should be created to all levels of the building. 4.Code compliant electrical wiring should be installed. 5.A code compliant electrical lighting system should be installed. 6.Electrical circuit panels should be properly protected per code. 7.Install a code compliant HVAC system. 8.Thresholds do not comply with code for maximum height. 9.Smoke detectors do not comply with code. 10.Emergency lighting does not comply with code. 11.Install a code required emergency notification system. 12.Exit signage does not comply with code. 13.The building sprinkler system is not code compliant. 14.Flooring material is damaged creating an impediment to emergency egress which is contrary to code. 15.Concrete sidewalks are damaged creating an impediment to emergency egress which is contrary to code. 16.Door hardware does not comply with code. 17.Code required fire caulking should be installed. 18.Install code required 10-inch kick plates on glass doors. 19.Replace failed roofing material to prevent water intrusion per code. 20.Repair/replace damaged exterior concrete block walls to prevent water intrusion per code. Moon Plaza Redevelopment TIF DistrictPage 2of 3Building Report LHB Project No.221327.00Parcel A –6257 University Ave NE, Fridley, MN 55432 DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 39 83 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 21.Replace failed windows to prevent water intrusion per code. 22.Replace failed expansion joint caulking to prevent water intrusion per code. PWFSWJFX!PG!EFGJDJFODJFT This strip mall shopping center has been operating for many years. Steel lintels should be protected from rusting per code. Glass doors should have code required 10-inch kick plates installed. Sidewalks are cracked/damaged creating and impediment to emergency egress which is contrary to code. Restrooms should be modified to comply with code. A code required accessible route to all levelsshould be created. Interior walls should be repaired/repainted. All life safety systems should be made code compliant. Flooring material is damaged creating an impediment to emergency egress. The electrical wiring and lighting systems do not comply with code. A code compliant HVAC system should be installed. Code required fire caulking should be installed. Failed roofing material should be replaced to prevent water intrusion per code. Failed exterior wall systems should be repaired/replaced to prevent water intrusion per code. FOFSHZ!DPEF!EFGJDJFODJFT In addition to the building code deficiencies listed above, the existing building does not comply with the current energy code. These deficiencies are not included in the estimated costs to correct code deficiencies and are not considered in determining whetherthe building is substandard. M:\\22Proj\\221327\\300 Design\\Reports\\Building Reports\\A-6257 University Ave NE Building Report Redevelopment District.docx Report by LHB, Inc. Moon Plaza Redevelopment TIF DistrictPage 3of 3Building Report LHB Project No.221327.00Parcel A –6257 University Ave NE, Fridley, MN 55432 DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 40 84 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 BQQFOEJY!D Building Replacement Cost Report Code Deficiency Cost Report Photographs Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 41 85 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Nppo!Qmb{b!Sfefwfmpqfnfou!UJG!Ejtusjdu Replacement Cost Report Moon Plaza Redevelopment TIF DistrictReplacement Cost Report LHB Project No. 221327.00Page 1 of 3Parcel A - 6257 University Ave NE, Fridley, MN 55432 DRAFT FOR HRA MEETING, FEBRUARY 2, 202342 86 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. Moon Plaza Redevelopment TIF DistrictReplacement Cost Report LHB Project No. 221327.00Page 2 of 3Parcel A - 6257 University Ave NE, Fridley, MN 55432 DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 43 87 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. Moon Plaza Redevelopment TIF DistrictReplacement Cost Report LHB Project No. 221327.00Page 3 of 3Parcel A - 6257 University Ave NE, Fridley, MN 55432 DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 44 88 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Nppo!Qmb{b!Sfefwfmpqnfou!UJG!Ejtusjdu Code Deficiency Cost Report Qbsdfm!B!.!7368!Vojwfstjuz!Bwfovf!Opsuifbtu-!Gsjemfz-!Njooftpub!66543Cvjmejoh!Obnf!ps!Uzqf Parcel ID 14-30-24-34-0004Moon Plaza Dpef!!Sfmbufe!Dptu!JufntVoju!DptuVojutVoju!RvboujuzUpubm Bddfttjcjmjuz!Jufnt Restrooms Modify restrooms to comply with code $ SF26,000104,520.004.02$ Accessible Route Create a code required accessible route to all levels $ SF26,000169,000.006.50$ Tusvduvsbm!Fmfnfout Steel Lintels Protect steel lintels from rusting per code $ Lump11,000.00$1,000.00 Fyjujoh Report by LHB, Inc. Thresholds Modify thresholds to comply with code for maximum height $ Lump12,500.00$2,500.00 Flooring Repair/replace damaged flooring to create a code required unimpeded means for emergency egress $ SF26,0002.50$65,000.00 Sidewalks Repair/replace damaged sidewalks to create a code required unimpeded means for emergency egress $ SF26,0000.50$13,000.00 Stairs Install code compliant interior and exterior stairs $ SF26,000159,120.006.12$ Exit Signage Install code compliant exit signage $ SF26,0001.65$42,900.00 Emergency Lighting Install code compliant emergency lighting $ SF26,0001.55$40,300.00 Door Hardwae Install code compliant door hardware $ EA50250.00$12,500.00 Glass Doors Install code required 10-inch kick plates on glass doors $ EA36100.00$3,600.00 Gjsf!Qspufdujpo Emergency Notification System Install a code compliant emergency notification system $ SF26,0000.52$13,520.00 Smoke Detectors Install code compliant smoke detectors $ SF26,0001.16$30,160.00 Fire Caulking Install code required fire caulking $ SF26,0000.25$6,500.00 Moon Plaza Redevelopment TIF DistrictCode Deficiency Cost Report Page 1 of 2 LHB Project No. 221327.00Parcel A - 6257 University Ave NE, Fridley, MN 55432 DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 45 89 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Dpef!!Sfmbufe!Dptu!JufntVoju!DptuVojutVoju!RvboujuzUpubm Building Sprinkler System Modify building sprinkler system to comply with code $ SF26,000138,320.005.32$ Fyufsjps!Dpotusvdujpo Exterior Walls $ SF26,0002.25$58,500.00 Repair/replace damaged concrete block walls to prevent water intrusion per code $ SF26,0000.25$6,500.00 Replace failed expansion joint caulking to prevent water intrusion per code Windows $ SF26,0003.39$88,140.00 Replace failed windows to prevent water intrusion per code Sppg!Dpotusvdujpo Roofing Material $ SF26,000299,000.0011.50$ Replace failed roofing material to prevent water intrusion per code Nfdibojdbm.!Fmfdusjdbm Mechanical Report by LHB, Inc. $ SF26,000267,280.0010.28$ Install code compliant HVAC system Electrical $ EA2100.00$200.00 Protect circuit panels per code $ SF26,000157,040.006.04$ Install code compliant electrical wiring $ SF26,000248,820.009.57$ Install code compliant electrical lighting Upubm!Dpef!Jnqspwfnfout2-:38-531% Moon Plaza Redevelopment TIF DistrictCode Deficiency Cost Report Page 2 of 2 Parcel A - 6257 University Ave NE, Fridley, MN 55432 LHB Project No. 221327.00 DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 46 8: Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 47 91 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 48 92 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 49 93 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 50 94 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 51 95 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 52 96 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 53 97 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 54 98 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 55 99 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 56 9: Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 57 :1 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 58 :2 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 59 :3 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 60 :4 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Report by LHB, Inc. DRAFT FOR HRA MEETING, FEBRUARY 2, 2023 61 :5 Jufn!6/ () TAX INCREMENT FINANCING REDEVELOPMENT DISTRICT NO. 26 Qsfqbsfe!cz; 812Xbtijohupo!Bwfovf!Opsui-!Tvjuf!311-!Njoofbqpmjt-!NO!66512 MICdpsq/dpn MICQspkfduOp/332/11 DRAFT FOR HRA MEETING, FEBRUARY 2, 202362 :6 Jufn!7/ AGENDA REPORT Meeting Date:February 2, 2023 Meeting Type:Housing & Redevelopment Authority Submitted By:Paul Bolin, Assistant Executive Director Title Approval of Development Agreement Roers Companies Redevelopment of Moon Plaza Background The Authority memorializes the conditions, responsibilities, and details of the TIF assistance through a development agreement. The attached agreement is like previous agreements approved by the Authority. Recommendation Staff recommend the approval ofHRA Resolution No. 2023-06. Attachments and Other Resources HRA Resolution No. 2023-06 Development Agreement Vision Statement We believe Fridley will be a safe, vibrant, friendly and stable home for families and businesses. :7 Jufn!7/ Resolution No. 2023 - 06 Authorizing Execution and Delivery of a Contract for Private Redevelopment between the Housing and Redevelopment Authority in and for the City of Fridley and Roers Acquisitions LLC Whereas, It has been proposed that the Housing and Redevelopment Authority in and for the Roers Acquisitions LLC ; and, Whereas, It has been proposed that the Contract is consistent with the objectives set forth in the development program known as the Redevelopment Plan for its Redevelopment Project No. et seq., as amended and supplemented from time to time.. Now, therefore be it resolved, that, the Authority hereby finds, determines and declares as follows: 1.That the Contract promotes to objectives set forth in the Redevelopment Program; and 2.That the Chairman and Executive Director of the Authority are hereby authorized to execute and deliver the Contract when the following conditions are met: (a)Substantial conformity of the Contract to the form of Contract presented to the Authority as of this date, with such additions and modifications as the Officers may deem desirable or necessary as evidenced by their execution of the Contract. Passed and adopted by the Housing and Redevelopment Authority in and for the City of nd Fridley this 2 day of February, 2023. _______________________________________________ Elizabeth Showalter Chairperson Attest: __________________________________________________ Walter T. Wysopal Executive Director :8 Jufn!7/ DRAFT: January 23 2023 _________________________________________________________________ _________________________________________________________________ CONTRACT FOR PRIVATE REDEVELOPMENT By and Between the HOUSING AND REDEVELOPMENT AUTHORITY In and For THE CITY OF FRIDLEY, MINNESOTA And ROERS ACQUISITIONS LLC _________________________________________________________________ _________________________________________________________________ This document was drafted by: Vickie Loher-Johnson, Esq. Monroe Moxness Berg PA 7760 France Avenue South Suite 700 Minneapolis, MN 55435 952-885-5999 :9 Jufn!7/ TABLE OF CONTENTS !Qbhf! ARTICLE I Efgjojujpot! Tfdujpo!2/2!Efgjojujpot!5! ARTICLE II Sfqsftfoubujpot!boe!Xbssboujft! Tfdujpo!3/2!Sfqsftfoubujpot!boe!Dpwfobout!cz!uif!Bvuipsjuz!8! Tfdujpo!3/3!Sfqsftfoubujpot-!Xbssboujft!boe!Dpwfobout!cz!uif!Sfefwfmpqfs!9! ARTICLE III Voefsubljoht!pg!Sfefwfmpqfs!boe!Bvuipsjuz! Tfdujpo!4/2!Qmbu<!Dpwfobout<!Fbtfnfout!22! Tfdujpo!4/3!!Efdmbsbujpo!pg!Sftusjdujwf!Dpwfobou!boe!Qspijcjujpo!Bhbjotu! !!!Uby!Fyfnqujpo!22! Tfdujpo!4/4!Dpotusvdujpo!Qmbot!22! Tfdujpo!4/5!Qsfmjnjobsz!Qmbot!22! Tfdujpo!4/6!Dpotusvdujpo!pg!Njojnvn!Jnqspwfnfout!boe!Qvcmjd!Jnqspwfnfout!22! Tfdujpo!4/7!Fowjsponfoubm!Voefsubljoht!22! Tfdujpo!4/8!Jttvbodf!pg!Opuf!23! Tfdujpo!4/9!Cvtjoftt!Tvctjez!Qspwjtjpot!24! Tfdujpo!4/:!Sfqbznfou!pg!Bttjtubodf!24! ARTICLE IV Dpotusvdujpo!pg!Njojnvn!Jnqspwfnfout! Tfdujpo!5/2!Dpotusvdujpo!pg!Njojnvn!Jnqspwfnfout!26! Tfdujpo!5/3!Dpnqmfujpo!pg!Dpotusvdujpo!26! Tfdujpo!5/4!Qsfmjnjobsz!Qmbot!boe!Dpotusvdujpo!Qmbot!26! Tfdujpo!5/5!Dfsujgjdbuf!pg!Dpnqmfujpo!27! ARTICLE V Jotvsbodf!! Tfdujpo!6/2!Sfefwfmpqfs!Jotvsbodf!29! j! :: Jufn!7/ ARTICLE VI Qspijcjujpot!Bhbjotu!Bttjhonfou!boe!Usbotgfs-!Sfmfbtf!ps!Joefnojgjdbujpo! Tfdujpo!7/2!Sfqsftfoubujpo!bt!up!Sfefwfmpqnfou!2:! Tfdujpo!7/3!Qspijcjujpo!Bhbjotu!Usbotgfs!pg!Qspqfsuz!boe!Bttjhonfou!!2:! !!pg!Bhsffnfou! Tfdujpo!7/4!Bttjhonfou!pg!Opuf!2:! Tfdujpo!7/5!Sfmfbtf!boe!Joefnojgjdbujpo!Dpwfobout!31! ! ARTICLE VII ! Fwfout!pg!Efgbvmu! Tfdujpo!8/2!Fwfout!pg!Efgbvmu!Efgjofe!33! Tfdujpo!8/3!Sfnfejft!po!Efgbvmu!34! Tfdujpo!8/4!Op!Sfnfez!Fydmvtjwf!34! Tfdujpo!8/5!Op!Jnqmjfe!Xbjwfs!34! Tfdujpo!8/6!Bhsffnfou!up!Qbz!Buupsofz(t!Gfft!boe!Fyqfotft!34! ! ARTICLE VIII ! Uby!Jodsfnfou<!Ubyft! Tfdujpo!9/2!Qmfehf!pg!Uby!Jodsfnfou!35! Tfdujpo!9/3!Sjhiu!up!Dpmmfdu!Efmjorvfou!Ubyft!35! Tfdujpo!9/4!Sfwjfx!pg!Ubyft!35! Tfdujpo!9/5!Qfujujpo!up!Sfevdf!Uby!35! ARTICLE IX Beejujpobm!Qspwjtjpot! Tfdujpo!:/2!Dpogmjdu!pg!Joufsftu!36! Tfdujpo!:/3!Sftusjdujpot!po!Vtf!36! Tfdujpo!:/4!Joufoujpobmmz!Pnjuufe!36! Tfdujpo!:/5!Opujdft!boe!Efnboet!36! Tfdujpo!:/6!Dpvoufsqbsut!36! Tfdujpo!:/7!Mbx!Hpwfsojoh!36! Tfdujpo!:/8!Fyqjsbujpo!36! Tfdujpo!:/9!Ufsnjobujpo!37! Tfdujpo!:/:!Qspwjtjpot!Tvswjwjoh!Ufsnjobujpo!37! SIGNATURES!!38! ! jj! 211 Jufn!7/ SCHEDULE A!Eftdsjqujpo!pg!Sfefwfmpqnfou!Qspqfsuz!3:! SCHEDULE B!Tjuf!Qmbo!41! SCHEDULE C!Tjuf!Jnqspwfnfout!42! SCHEDULE D!Qvcmjd!Jnqspwfnfout!43! SCHEDULE E!Gpsn!pg!Opuf!44! SCHEDULE F Gpsn!pg Dfsujgjdbuf!pg!Dpnqmfujpo!48! SCHEDULE G Efdmbsbujpo!pg!Sftusjdufe!Dpwfobout!boe!Qspijcjujpo! !!Bhbjotu!Uby!Fyfnqujpo!4:! ! ! jjj! 212 Jufn!7/ CONTRACT FOR PRIVATE REDEVELOPMENT! THIS AGREEMENT,!nbef!po!ps!bt!pg!uif!``````!ebz!pg!`````````-!3134!cz! boe!cfuxffo!uif!Ipvtjoh!boe!Sfefwfmpqnfou!Bvuipsjuz!jo!boe!gps!uif!Djuz!pg!Gsjemfz-! Njooftpub-!b!qpmjujdbm!tvcejwjtjpo!pg!uif!Tubuf!pg!Njooftpub!pshboj{fe!voefs!uif! Dpotujuvujpo!boe!mbxt!pg!uif!Tubuf!pg!Njooftpub!)uif!#Bvuipsjuz#*-!boe!Spfst!Bdrvjtjujpot! MMD-!b!Njooftpub!mjnjufe!mjbcjmjuz!dpnqboz!pshboj{fe!voefs!uif!mbxt!pg!uif!Tubuf!pg! Njooftpub!)uif!#Sfefwfmpqfs#*-! WITNESSETH: WHEREAS,!uif!Cpbse!pg!Dpnnjttjpofst!)uif!#Cpbse#*!pg!uif!Bvuipsjuz!ibt! efufsnjofe!uibu!uifsf!jt!b!offe!gps!efwfmpqnfou!boe!sfefwfmpqnfou!xjuijo!uif! dpsqpsbuf!mjnjut!pg!uif!Djuz!up!qspwjef!fnqmpznfou!pqqpsuvojujft<!up!qspwjef!befrvbuf! ipvtjoh!jo!uif!Djuz-!jodmvejoh!mpx!boe!npefsbuf!jodpnf!ipvtjoh-!ipvtjoh!gps!uif!fmefsmz! boe!xpslgpsdf!ipvtjoh<!up!jnqspwf!uif!uby!cbtf<!boe!up!jnqspwf!uif!hfofsbm!fdpopnz!pg! uif!Djuz!boe!uif!Tubuf!pg!Njooftpub<! WHEREAS,!jo!gvsuifsbodf!pg!uiftf!pckfdujwft-!uif!Bvuipsjuz!ibt!bepqufe-! qvstvbou!up!Njooftpub!Tubuvuft-!Tfdujpot!57:/112!fu!tfr/!)uif!#Bdu#*-!b!efwfmpqnfou! qsphsbn!lopxo!bt!uif!Npejgjfe!Sfefwfmpqnfou!Qmbo!)uif!#Sfefwfmpqnfou!Qmbo#*!boe! ftubcmjtife!Sfefwfmpqnfou!Qspkfdu!Op/!2!)uif!#Qspkfdu!Bsfb#*!jo!uif!Djuz!up!fodpvsbhf! boe!qspwjef!nbyjnvn!pqqpsuvojuz!gps!qsjwbuf!efwfmpqnfou!boe!sfefwfmpqnfou!pg! dfsubjo!qspqfsuz!jo!uif!Djuz!xijdi!jt!opu!opx!jo!jut!ijhiftu!boe!cftu!vtf<! WHEREAS,!jo!dpoofdujpo!xjui!uif!Qspkfdu!Bsfb-!Uby!Jodsfnfou!Gjobodjoh!Ejtusjdu! Op/!37!)uif!Uby!Jodsfnfou!Ejtusjdu*!ibt!cffo!bqqspwfe!cz!uif!Bvuipsjuz!boe!gpsxbsefe! up!uif!Djuz!bmpoh!xjui!uif!Uby!Jodsfnfou!Gjobodjoh!Qmbo-!xijdi!Uby!Jodsfnfou!Gjobodjoh! Qmbo!jt!up!cf!dfsujgjfe!cz!Boplb!Dpvouz!boe!gjmfe!xjui!uif!Tubuf-!qvstvbou!up!uif! Njooftpub!Uby!Jodsfnfou!Gjobodjoh!Bdu!dpoubjofe!jo!Njooftpub!Tubuvuft-!Tfdujpot! 57:/285!up!57:/28::<!!! ! WHEREAS,!nbkps!pckfdujwft!jo!ftubcmjtijoh!uif!Qspkfdu!Bsfb!bsf!up;! ! 2/!Qspnpuf!boe!tfdvsf!uif!efwfmpqnfou!boe!sfefwfmpqnfou!pg!qspqfsuz!jo! uif!Qspkfdu!Bsfb!jo!b!nboofs!dpotjtufou!xjui!uif!Djuzt!qmboojoh-!boe!xjui!b!njojnbm! bewfstf!jnqbdu!po!uif!fowjsponfou-!xijdi!qspqfsuz!jt!mftt!qspevdujwf!cfdbvtf!pg!uif! mbdl!pg!qspqfs!vujmj{bujpo!boe!mbdl!pg!jowftunfou-!boe!uifsfcz!qspnpujoh!boe!tfdvsjoh!uif! efwfmpqnfou!pg!puifs!mboe!jo!uif!Djuz<! ! 3/!Qspnpuf!boe!tfdvsf!beejujpobm!fnqmpznfou!pqqpsuvojujft!xjuijo!uif! 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WHEREAS,!uif!Bvuipsjuz!cfmjfwft!uibu!uif!efwfmpqnfou!boe!sfefwfmpqnfou!pg! uif!Sfefwfmpqnfou!Qspqfsuz!qvstvbou!up!uijt!Bhsffnfou-!boe!gvmgjmmnfou!hfofsbmmz!pg!uif! ufsnt!pg!uijt!Bhsffnfou-!bsf!jo!uif!wjubm!boe!cftu!joufsftut!pg!uif!Bvuipsjuz!boe!uif! ifbmui-!tbgfuz-!npsbmt!boe!xfmgbsf!pg!jut!sftjefout-!boe!jo!bddpse!xjui!uif!qvcmjd! qvsqptft!boe!qspwjtjpot!pg!bqqmjdbcmf!gfefsbm-!tubuf!boe!mpdbm!mbxt!voefs!xijdi!uif! efwfmpqnfou!boe!sfefwfmpqnfou!bsf!cfjoh!voefsublfo!boe!bttjtufe<! ! NOW, THEREFORE,!jo!dpotjefsbujpo!pg!uif!qspnjtft!boe!uif!nvuvbm!pcmjhbujpot! pg!uif!qbsujft!ifsfup-!fbdi!pg!uifn!epft!ifsfcz!dpwfobou!boe!bhsff!xjui!uif!puifs!bt! gpmmpxt;! ! 4! 215 Jufn!7/ ARTICLE I ! Efgjojujpot! 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Bvuipsjuz!gps!jut!Uby!Jodsfnfou!Gjobodjoh!Ejtusjdu!Op/!37/! ! #Ufsnjobujpo!Ebuf#!nfbot!uif!ebuf!efgjofe!jo!Tfdujpo!:/:!pg!uijt!Bhsffnfou/!! ! #Vobwpjebcmf!Efmbzt#!nfbot!efmbzt!xijdi!bsf!uif!ejsfdu!sftvmu!pg!tusjlft!ps!puifs! mbcps!uspvcmft-!efmbzt!xijdi!bsf!uif!ejsfdu!sftvmu!pg!vogpsftffbcmf!boe!vobwpjebcmf! dbtvbmujft!up!uif!Sfefwfmpqnfou!Qspqfsuz-!uif!Qspkfdu-!ps!uif!frvjqnfou!vtfe!up! dpotusvdu!uif!Sfefwfmpqnfou!Qspkfdu-!efmbzt!xijdi!bsf!uif!ejsfdu!sftvmu!pg!hpwfsonfoubm! bdujpot-!efmbzt!xijdi!bsf!uif!ejsfdu!sftvmu!pg!kvejdjbm!bdujpo!dpnnfodfe!cz!uijse!qbsujft-! efmbzt!xijdi!bsf!uif!ejsfdu!sftvmu!pg!djuj{fo!pqqptjujpo!ps!bdujpo!bggfdujoh!uijt! Bhsffnfou-!fowjsponfoubm!efmbzt!xijdi!bsf!uif!ejsfdu!sftvmu!pg!uif!jnqmfnfoubujpo!pg!bo! fowjsponfoubm!bhfodz.bqqspwfe!xpsl!qmbo!gps!sfnfejbujpo-!efmbzt!xijdi!bsf!uif!ejsfdu! sftvmu!pg!tfwfsf!xfbuifs!xijdi!qsfwfout!ps!efmbzt!dpotusvdujpo!pg!Njojnvn! Jnqspwfnfout-!bdut!pg!Hpe-!gjsf!ps!puifs!dbtvbmuz!up!uif!Qspkfdu-!tjuf!dpoejujpot! nbufsjbmmz!ejggfsfou!gspn!uiptf!sfwfbmfe!jo!boz!sfqpsu!ps!uftu!qspwjefe!up!ps!pcubjofe!cz! uif!Sfefwfmpqfs-!ps!boz!puifs!efmbzt!cfzpoe!uif!sfbtpobcmf!dpouspm!pg!b!Qbsuz-! jodmvejoh-!cvu!opu!mjnjufe!up-!efmbzt!dbvtfe!ejsfdumz!ps!joejsfdumz!cz!qboefnjd/! 7! 218 Jufn!7/ ARTICLE II ! !Sfqsftfoubujpot!boe!Xbssboujft! 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Bvuipsjuz-!boe!pomz!uif!Bvuipsjuz!tibmm!ibwf!uif!sjhiu!up!tvf!gps!boe!pcubjo!bo!jokvodujpo-! qspijcjujwf!ps!nboebupsz-!up!qsfwfou!uif!csfbdi!pg!uif!dpwfobout!boe!sftusjdujpot!ifsfjo! dpoubjofe-!ps!up!fogpsdf!uif!qfsgpsnbodf!ps!pctfswbodf!uifsfpg/! ! 4/!Uif!dpwfobout!boe!sftusjdujpot!ifsfjo!dpoubjofe!tibmm!sfnbjo!jo!fggfdu!voujm! Efdfncfs!42-!3161!boe!uifsfbgufs!tibmm!cf!ovmm!boe!wpje/! ! 5/!Jg!boz!pof!ps!npsf!pg!uif!dpwfobout!ps!sftusjdujpot!dpoubjofe!jo!uijt! Efdmbsbujpo!bsf!ifme!up!cf!jowbmje!ps!fogpsdfbcmf-!uif!tbnf!tibmm!jo!op!xbz!bggfdu!boz!pg! uif!puifs!qspwjtjpot!pg!uijt!Efdmbsbujpo-!xijdi!tibmm!sfnbjo!jo!gvmm!gpsdf!boe!fggfdu/! 4:! 251 Jufn!7/ !!SPFST!BDRVJTJUJPOT!MMD-! !!!!!b!Njooftpub!mjnjufe!mjbcjmjuz!dpnqboz! !!!!!Cz!```````````````````````````````! !!!!!Qsjoufe!Obnf;!!``````````````````! !!!!!Jut;!!````````````! TUBUF!PG!NJOOFTPUB!*! !!!*!tt! DPVOUZ!PG!``````````!*! !Po!uijt!``````!ebz!pg!``````````````````-!313``-!cfgpsf!nf-!b!opubsz! qvcmjd!xjuijo!boe!gps!```````````!Dpvouz-!qfstpobmmz!bqqfbsfe!``````````-!up!nf! qfstpobmmz!lopxo!boe!xip!cz!nf!evmz!txpso-!eje!tbz!uibu!if0tif!jt!uif!```````````!pg! Spfst!Bdrvjtjujpot!MMD-!b!Njooftpub!mjnjufe!mjbcjmjuz!dpnqboz-!boe!bdlopxmfehfe!uif! gpsfhpjoh!jotusvnfou!po!cfibmg!pg!tbje!mjnjufe!mjbcjmjuz!dpnqboz/! ! ! !!!!!```````````````````````````````````! !!!!!Opubsz!Qvcmjd! 51! 252 Jufn!8/ AGENDA REPORT Meeting Date:February 2, 2023 Meeting Type:Housing & Redevelopment Authority Submitted By:Paul Bolin, Assistant Executive Director Title Update on Housing Programs Background On a monthly basis, staff will provide updates from loan programs, remodeling advisor visits and Home Energy Squad Visits. Attachments and Other Resources Chart of Loans Issued and Remodeling Advisor Visits Vision Statement We believe Fridley will be a safe, vibrant, friendly and stable home for families and businesses. 253 Jufn!8/ 38 48 2 45 11 %2-1:1-225/29 29891/11 34: 6111/11 27 41111/11 1/11 11 1/11 1/11 11 1/11 1/11 12 8111/11 1/11 12 28958/11 1/11 124 2:8776/11 2453737/29 34891/11 471 1/111354156/119 1/11354156/119 1 254 Jufn!8/ -- 22/56 21/:6 / 22/56 98/73 6:96/62 65/87 45/46 65/87 68/36 87/78 43/97 76/82 32/:1 // 21/:6 / 65/87 21/:6 43/97 21/:6 / 2221/59 43/97 21/:6 2221/59 21:/63 21/:6 21/:6 87/78 32/:1 32/:1 43/97 - 21/:6 54/92 255