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121911completeagenda CITY OF RICHFIELD, MINNESOTA MONDAY, DECEMBER 19, 2011 RICHFIELD MUNICIPAL CENTER 6700 PORTLAND AVENUE SPECIAL HOUSING AND REDEVELOPMENT AUTHORITY WORKSESSION BARTHOLOMEW CONFERENCE ROOM 6:30 P.M. AGENDA Call to order Roll call 1. Discussion regarding Richfield Rediscovered Proposal for Speculative Development Notes: Adjournment ******************************************************************************************************* REGULAR HOUSING AND REDEVELOPMENT AUTHORITY MEETING COUNCIL CHAMBERS 7:00 P.M. AGENDA Call to order Roll call 1. Appointment of HRA Acting Secretary for December 2011 2. Approval of minutes of (1) Special HRA Worksession of November 21, 2011 and (2) Regular HRA Meeting of November 21, 2011 3. HRA approval of agenda 4. Consideration of annual Consultant Services Agreement with Greater Metropolitan Housing Corporation for 2012 Staff Report No. 54 Notes: 5. Consideration of resolution granting assistance in amount of$250,000 and approving funding agreement with Pizza Luce for acquisition and redevelopment of 800 West 66th Street Staff Report No. 55 Notes: 6. Consideration of contract with Stantec Consulting Services to conduct Rental Housing Inventory and Needs Assessment Staff Report No. 56 Notes: 7. HRA discussion items Notes: 8. Executive Director report Notes: 9. Claims and payroll Adjournment Auxiliary aids for individuals with disabilities are available upon request. Requests must be made at least 96 hours in advance to the City Clerk at 612-861-9738. richfield: December 2011 Page 1 of 1 City of Richfield Calendar Calendars Net Navigate: 2010 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2012 December 2011 moaday° Tuesday Wednesday Thursday Friday 28 I Nov 29 30 1 I Dec 2r 5:30p Human Services 7:OOp-8:OOp Neighborhood 7:OOp Arts Commission Planning Council meeting by Ron Clark @ 7000 Nicol let Ave 7:OOp Planning Construction and Design SAT.,DEC.3 Commission regarding proposed Mayor's Hour- Pillsbury Commons project 9:30-10:30 a.m.at -Emerson Congregational Wood Lake Nature United Church of Christ Center Friendship Hall,7601 Girard Avenue 5 6 7 8 9 11:30a Richfield Tourism 7:OOp Transportation Promotion Board @ 6601 Commission Lyndale Ave,Suite 106 6:30p Human Rights Commission 7:OOp Special City Council Meeting (Truth-in-Taxation) 12 13 14 15 16 7:OOp Canceled- 5:30p Special City 7:OOp Friendship City Planning Commission Council/HRA/Community Commission Meeting Services CANCELED Commission/Planning Commission/Transportation Commission Meeting (possible quorum) regarding U of MN Capstone Project final presentation 7:OOp City Council Regular Meeting 19 20 21 22 ?3 6:30p Special HRA 7:OOp Community Services Worksession Commission @ 7000 7:OOp Housing and Nicollet Ave Redevelopment Authority(HRA) 26 2:' 28 29 30 City Administrative 7:OOp City Council Regular SATURDAY,DEC.31 offices closed-- Meeting CANCELED 9:30 a.m.-10:30 a.m. Christmas holiday Mayor's Hour @ WLNC observed CANCELED . 3 4 5 6 CITY 11:30a Tourism Promotion 7:OOp Transportation 7:OOp Arts Commission ADMINISTRATIVE Board @ 6601 Lyndale Commission @ 7000 Nicollet Ave OFFICES CLOSED-- Ave,Suite 106 NEW YEARS DAY 7:OOp Human Rights HOLIDAY OBSERVED Commission Display: Year Month Week Day Block List Condensed Abs Slide Calendars: Search Add Events: Daily Duration Periodic Administer: This Calendar All meetings held at City Hall (6700 Portland Avenue) unless indicated otherwise Calendars Net free online interactive web calendars http://www.my.calendars.net/richfield 12/15/2011 HOUSING AND REDEVELOPMENT RICHFIELD AUTHORITY MEETING MINUTES Richfield, Minnesota Special Housing and Redevelopment Authority Worksession November 21 , 2011 CALL TO ORDER The meeting was called to order by Vice Chair Quam at 6:30 p.m. ROLL CALL HRA Members Steve Quam, Vice Chair; Debbie Goettel; and Doris Rubenstein Present: HRA Members Sue Sandahl, Chair Absent: Staff Present: John Stark, Acting Executive Director; Christine Costello, Community Development Coordinator; and Nancy Gibbs, City Clerk. Item # I DISCUSSION REGARDING LEMETTRY AUTO BODY INTEREST IN PURCHASING CANDLEWOOD OUTLOT Acting Executive Director Stark presented background information regarding Candlewood outlot. (City Clerk File No. 465) Jim Carter, General Manager of Richfield Bloomington Honda, presented possible future plans for the Honda dealership. Mark Balay of Balay Architects, was also present. Rick LaMettry, owner of LaMettrys Auto Body, was also available to answer questions regarding this possible purchase. After much discussion, the commissioners agreed they would like to hear and see more information on this project. ADJOURNMENT The meeting was adjourned by unanimous consent at 6:57 p.m. Special Worksession Minutes -2- November 21, 2011 Date Approved: December 19, 2011 Steven J. Quam Vice Chair Nancy Gibbs John Stark City Clerk Acting Executive Director HOUSING AND REDEVELOPMENT RICHFIELD AUTHORITY MEETING MINUTES Richfield, Minnesota Regular Meeting November 21 , 2011 CALL TO ORDER The meeting was called to order by Vice Chair Quam at 7:00 p.m. ROLL CALL HRA Members Steven Quam, Vice Chair; Debbie Goettel and Doris Rubenstein Present: HRA Members Sue Sandahl, Chair Absent: Staff Present: John Stark, Acting Executive Director; Karen Barton, Assistant Community Development Director; and Nancy Gibbs, City Clerk. Item #1 APPROVAL OF MINUTES OF (1) REGULAR HRA MEETING OF OCTOBER 17, 2011 M/Rubenstein, S/Goettel to approve the minutes of the Regular HRA Meeting of October 17, 2011. Motion carried 3-0. Item #2 HRA APPROVAL OF AGENDA M/Rubenstein, S/Goettel to approve the agenda. Motion carried 3-0. HRA Meeting -2- November 14,2011 Item #3 CONSENT CALENDAR Acting Executive Director Stark presented Staff Report No. 52. A. Consideration of approval of contract with All Metro Excavating, Inc. for demolition at 7544 Second Avenue and 7035 Fifth Avenue S.R. No. 51 B. Consideration of approval of transfer from Richfield Rediscovered Tax Increment Financing District funds to Development Account to close Richfield Rediscovered Funds S.R. No. 52 M/Goettel, S/Rubenstein to approve the Consent Calendar. Motion carried 3-0. Item #4 CONSIDERATION OF CONTRACT WITH STANTEC CONSULTING SERVICES TO CONDUCT RENTAL HOUSING INVENTORY AND NEEDS ASSESSMENT (STAFF REPORT NO. 53) Assistant Community Development Director Barton presented Staff Report No. 53. Acting Executive Director Stark explained recommendation of Stantec Consulting Services. After much discussion, the HRA decided to continue this discussion at the next HRA meeting and invite Stantec Consulting Services to define needs assessment. M/Quam, S/Goettel that this item be continued until staff can convey concerns and direction to consultant to receive modified proposal at December HRA Meeting. Motion carried 3-0. Item #5 HRA DISCUSSION ITEMS None. Item #6 EXECUTIVE DIRECTOR REPORT Acting Executive Director Stark reported that the Wellington Group closed on the K-Mart property on Monday, November 14 and that the Cornerstone Group closed on the Lyndale Garden Center site on Monday, November 21. Item #7 CLAIMS AND PAYROLL M/Goettel, S/Quam that the following claims and payrolls be approved: HRA Meeting -3- November 14,2011 U.S BANK 11/21/2011 Section 8 Checks: 121172-121292 $ 154,410.93 HRA Checks: 31331-31355 $ 741,937.32 TOTAL $ 896,348.25 Motion carried 3-0. ADJOURNMENT The meeting was adjourned by unanimous consent at 7:28 p.m. Date Approved: December 19, 2011 Steven J. Quam Vice Chair Nancy Gibbs John Stark City Clerk Acting Executive Director AGENDA ITEM#: 4 REPORT#: 54 STAFF REPORT RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY MEETING DECEMBER 19, 2011 REPORT PREPARED BY: MICHELLE LEWIS/JULIE URBAN, HOUSING SPECIALISTS NAME,TITLE REPORT PRESENTER: KAREN BARTON, COMMUNITY DEVELOPMENT ASSISTANT DIRECTOR NAME,TITLE DEPARTMENT DIRECTOR REVIEW: //r0i0% ■ REVIEWED BY EXECUTIVE DIRECTOR: G / r 46/41■II _ice ITEM FOR HRA CONSIDERATION: Consideration of annual Consultant Services Agreement with the Greater Metropolitan Housing Corporation for 2012. I. RECOMMENDED ACTION: By Motion: Authorize the attached Consultant Services Agreement with the Greater Metropolitan Housing Corporation for 2012. II. BACKGROUND The Greater Metropolitan Housing Corporation (GMHC) specializes in a variety of housing programs, services and financing options for homeowners. The partnership with the Richfield Housing and Redevelopment Authority (HRA) began in 2004 and provides GMHC's services to residents at no cost. Through November 2011 GMHC provided 873 services to 589 Richfield residents through its Southside HousingResource Center (HRC) (see Attachment 1). In addition, 16 Minnesota Housing Finance Agency rehabilitation loans were processed through the HRC. Services offered include, but are not limited to: • Home buyer information, loan services (including Minnesota Housing Finance Agency loans), construction consultations, energy assistance, 12192011 GMHC Services Contract.doc mortgage foreclosure prevention, home improvement information, and assistance with rental and emergency housing issues. In 2011, GMHC coordinated a grant proposal to Minnesota Housing on behalf of Richfield, Brooklyn Center and Crystal for an interest-rate write-down program. Funds were awarded and beginning in 2012, GMHC will offer home rehabilitation loans at three percent interest to income-qualified households in Richfield, Brooklyn Center and Crystal. The HRA has also successfully partnered with GMHC for the construction of affordable houses built under the New Home Program as well as the purchase and rehabilitation of properties through the Neighborhood Stabilization Program. III. BASIS OF RECOMMENDATION A. POLICY • A partnership between the HRA and GMHC ensures the availability of comprehensive rehabilitation resources and financing resources to Richfield residents. It also serves to accomplish the two housing goals and several housing policies identified in the 2008 Comprehensive Plan: o Goal: Maintain and enhance Richfield's image as a community with strong, desirable and livable neighborhoods. • Support the rehabilitation and upgrading of the existing housing stock. • Encourage the creation of"move-up" housing through new construction and home remodeling. • Support ongoing maintenance and upkeep of residential properties. o Goal: Ensure sufficient diversity in the housing stock to provide for a range of household sizes, income levels and needs. • Encourage improvements to the housing stock to better serve families with children and seniors. • Promote the development, management, and maintenance of affordable housing in the City through assistance programs; alternative funding sources; and the creation of partnerships whose mission is to promote low to moderate income housing. B. CRITICAL ISSUES • GMHC offers Richfield homeowners comprehensive home improvement support and a variety of programs in a cost-effective manner. • GMHC offers their packages of programs and services in 16 metro area communities. By partnering with GMHC for these services, Richfield will remain competitive in the metro area. C. FINANCIAL • The cost of services for 2011 is $7,000; unchanged since 2009. • Funds are allocated for these services in the 2012 HRA budget. D. LEGAL • The Agreement has been reviewed by legal counsel. IV. ALTERNATIVE RECOMMENDATION(S) • The HRA can choose to direct staff to modify the scope of services or modify the amount with GMHC. • The HRA can choose to not approve the Agreement. V. ATTACHMENTS • Copy of the Consultant Services Agreement VI. PRINCIPAL PARTIES EXPECTED AT MEETING • N/A CONSULTANT SERVICES AGREEMENT THIS IS AN AGREEMENT entered into the day of , 20_, by and between the Richfield Housing and Redevelopment Authority, ("HRA"), and GREATER METROPOLITAN HOUSING CORPORATION, a Minnesota non-profit corporation ("Consultant"). RECITALS A. The Consultant has a division called The Housing Resource Center ("HRC"). GMHC has agreed to provide certain Services through HRC (as defined below) in connection with the HRA's housing program. B. The HRA desires to hire the Consultant to render this technical, professional, and marketing assistance in connection with housing programs in the HRA for the term as set forth in this Agreement. C. Consultant is willing to provide such services on the terms and conditions set forth herein. In consideration of the foregoing recitals and following terms, conditions and mutual promises contained herein, the parties agree as follows: 1. Scope of Services. The Consultant shall provide services as follows (the "Services"): a. Administer the following home improvement programs for residents of the City of Richfield (the "City"): MHFA Fix Up Fund, Community Fix Up Fund and the MHFA Rental Rehab Program (collectively the MHFA programs): 1. Providing information to residents and property owners about the programs, upon request; 2. Assist the HRA in marketing the programs; 3. Receipt of applications from residents; 4. Processing applications; 5. Closing loans to qualified applicants in accordance with the applicable program; 6. Overseeing the draw process for the funds, including, as necessary, reviewing draws, reviewing the progress of the work and collecting lien waivers and certificates of occupancy. Consultant may, for this purpose, rely on third-party representations and certifications. 7. Provide monthly reports about the number of loans closed and the balance in each loan program. fh.us.3166730.04 1 - a b. Assist City residents considering rehabilitation, including property visits, meet with homeowners and potential contractors, suggest alternatives for rehabilitation to homeowners, educate homeowners on the construction bid process, assist homeowners to evaluate bids and work completed and construction progress. c. Provide HRC housing information to City residents, including information on emergency assistance, housing rehabilitation, first time homebuyers and limited rental information; d. Assist the HRA in developing programs to purchase and rehabilitate homes; e. Coordinate these services out of Consultant's Minneapolis office; and f. Have Consultant's staff visit residences as determined necessary by Consultant. 2. Term. This Agreement shall be in full force and effect from January 1, 2012 and shall continue through December 31, 2012, unless otherwise terminated as set forth below. 3. Compensation. For services provided under this Agreement, the HRA shall pay to the Consultant Seven Thousand Dollars ($7,000.00) within thirty (30) days after execution of this Agreement. Pursuant to paragraphs lb through i f. The Consultant shall receive compensation for administering the MHFA Programs directly from the Minnesota Housing Finance Agency and not from the HRA. Pursuant to paragraph 1 a. 4. Termination. Notwithstanding any other provision hereof to the contrary, this Agreement may be terminated as follows: a. The parties, by mutual written agreement, may terminate this Agreement at any time in which case the parties shall agree to the amount of fees payable to Consultant. b. HRA may terminate this Agreement upon the breach by Consultant of any of its material covenants contained herein, where such breach shall have continued for a period of thirty (30) days following the receipt by Consultant of a written notice from HRA, specifying the alleged breach; provided, however, if the nature of a non-monetary breach is such that Consultant cannot reasonably cure same in the thirty (30) day period, Consultant shall not be deemed to be in breach if it commences to cure within the thirty (30) day period, and diligently pursues same to completion within ninety (90) days following receipt by Consultant of such written notice. In the event of termination by HRA hereunder, Consultant shall be entitled to fees due to the date the notice of breach is sent by the HRA. c. If Consultant or HRA (as applicable) (i) files a voluntary petition in bankruptcy (ii) files a voluntary petition for reorganization under any bankruptcy law, statute or regulation or other similar statute or regulation, (iii) is adjudicated a bankrupt, (iv) makes an assignment for the benefit of creditors or applies for or consents to 1b.us.3166730.04 2 y the appointment of a receiver or trustee as part of or in conjunction with a "creditor plan" with respect to any substantial part of its assets, or (v) a receiver or trustee is appointed, or an attachment or execution levied with respect to any substantial part of its assets, and said appointment is not vacated, or the attachment or execution not released, within sixty (60) days, then this Agreement shall, effective as of such date, without notice or further action by either party, immediately terminate. d. Consultant may terminate this Agreement upon the breach by HRA of any of its material covenants contained herein, where such breach shall have continued for a period of thirty (30) days following the receipt by HRA of a written notice from Consultant, specifying the alleged breach; provided, however, if the nature of a non-monetary breach is such that HRA cannot reasonably cure same in the thirty (30) day period, HRA shall not be deemed to be in breach if it commences to cure within the thirty (30) day period, and diligently pursues same to completion within ninety (90) days following receipt by HRA of such written notice. In the event of termination by Consultant hereunder. Consultant shall be entitled to retain the entire fee under this Agreement. 5. Insurance. a. During the term of this Agreement, the Consultant shall obtain and maintain workers compensation, comprehensive general liability, and automobile liability insurance. Comprehensive general liability insurance shall have an aggregate limit of Two Million Dollars ($2,000,000.00). b. Upon request by the HRA, the Consultant shall provide a certificate or certificates of insurance relating to the insurance required. Such insurance secured by the Contractor shall be issued by insurance companies licensed in Minnesota. The insurance specified may be in a policy or policies of insurance, primary or excess. c. Such insurance shall be in force on the date of execution of an Agreement and shall remain continuously in force for the duration of the Agreement. 6. Indemnification. a. Notwithstanding anything to the contrary in this Agreement, the HRA, its officers, agents, and employees shall not be liable or responsible in any manner to the Consultant, the Consultant's successors or assigns, the Consultant's subcontractors, or to any other person or persons for any third party claim, demand, damage, or cause of action of any kind, nature, or character, including intentional acts, arising out of or by reason of the performance of this Agreement by Consultant. The Consultant, and the Consultant's successors or assigns, agree to protect, defend and save the HRA, and its officers, agents, and employees, harmless from all third party claims, demands, damages, and causes of action, to the extent caused by the negligence or wrongful acts of Consultant, and the costs, disbursements, and 1h.us.3166730.04 3 � - y expenses of defending the same, including but not limited to, attorneys fees, consulting services, and other technical, administrative or professional assistance. b. Nothing in this Agreement shall constitute a waiver or limitation of any immunity or limitation of any immunity or limitation on liability to which the HRA is entitled under Minnesota Statutes, Chapter 466, or otherwise. 7. Assignment. This Agreement shall not be assigned, sublet, or transferred, in whole or in part without the prior written approval of the HRA. 8. Conflict of Interest. The Consultant shall use best efforts to meet all professional obligations to avoid conflicts of interest and appearances of impropriety in representation of the HRA. In the event of a conflict, the Consultant, with the prior written consent of the HRA, shall arrange for suitable alternative services. 9. Compliance with Laws. The Consultant shall comply with all applicable Federal, State, and local laws, rules, ordinances, and regulations at all times and in the performance of the services pursuant to this Agreement. 10. Notices. Any notices permitted or required by this Agreement shall be deemed given when personally delivered or upon deposit in the United States mail, postage fully prepaid, certified, return receipt requested, addressed to: Consultant: Greater Metropolitan Housing Corporation 15 South 5`h Street, Suite 710 Minneapolis, MN 55402 ATTN: Suzanne Snyder HRA: Richfield Housing and Redevelopment Authority 6700 Portland Avenue Richfield, MN 55423 Or such other address as either party may provide to the other by notice given in accordance with this provision. 11. Entire Agreement. This Agreement, any attached exhibits and any addenda or amendments signed by the parties shall constitute the entire agreement between the HRA and the Consultant, and supersedes any other written or oral agreements between the HRA and the Consultant. This Agreement can only be modified in writing signed by the HRA and the Consultant. 12. Third Party Rights. The parties to this Agreement do not intend to confer on any third party any rights under this Agreement. 13. Counterparts. This Agreement may be signed in one or more counterparts but all of which taken together shall constitute one instrument. tb.us.3 166730.04 4 14. Choice of Law and Venue. This Agreement shall be governed by and construed in accordance with the laws of the state of Minnesota. Any disputes, controversies, or claims arising out of this Agreement shall be heard in the state or federal courts of Minnesota, and all parties to this Agreement waive any objection to the jurisdiction of these courts, whether based on convenience or otherwise. 15. Agreement Not Exclusive. The HRA retains the right to hire other housing program consultants, in the HRA's sole discretion. 16. Data Practices Act Compliance. Data provided to the Consultant or created by the Consultant under this Agreement shall be administered in accordance with the Minnesota Government Data Practices Act, Minnesota Statutes, Chapter 13, as amended. [Signature Page Follo4wsJ tb.us.3166730.04 - IN WITNESS WHEREOF, the parties hereto have executed, or caused to be executed by their duly authorized officials, this Agreement on the respective dates indicated below. HRA: RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY By: Its: Chairperson Date: , 20 . By It's Executive Director Date: , 20 . CONSULTANT: GREATER METROPOLITAN HOUSING CORPORATION By: Its: President Date: , 20 . ib.us.3166730.04 6 AGENDA ITEM#: 5 REPORT#: 55 STAFF REPORT RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY MEETING DECEMBER 19, 2011 REPORT PREPARED BY: KAREN BARTON, COMMUNITY DEVELOPMENT ASSISTANT DIRECTOR NAME, TIII.Is' REPORT PRESENTER: KAREN BARTON, COMMUNITY DEVELOPMENT ASSISTANT DIRECTOR NAAIIs,TIrLI DEPARTMENT DIRECTOR REVIEW: ' SJGNAT(/iii ' REVIEWED BY EXECUTIVE DIRECTOR: q � i ITEM FOR HRA CONSIDERATION: Consideration of assistance in the amount of $250,000 and a funding agreement with Pizza Luce. I. RECOMMENDED ACTION: By Motion: Consider the adoption of a Resolution granting assistance in the amount of $250,000, and approving a funding agreement with Pizza Luce for the acquisition and redevelopment of 800 West 66th Street. II. BACKGROUND Pizza Luce is requesting assistance from the Housing and Redevelopment Authority (HRA) in the amount of $250,000 to facilitate the acquisition and rehabilitation of the former Bridgeman's property, located at 800 West 66th Street. At its meeting on July 25, 2011 the HRA approved a spending plan for the Lyndale Gateway and Interchange TIF Districts in accordance with the Temporary TIF Authority Act (the "Spending Plan") to utilize existing tax increment revenues from the TIF Districts in order to stimulate construction or rehabilitation of private development in a way that will also create or retain jobs. On August 9, 2011 the 12192011 Pizza Luce Business Subsidy City Council held a public hearing regarding the Spending Plan and approved the Spending Plan. Pursuant to the Spending Plan, the HRA is authorized to spend Available Spending g Plan Increment (as defined in the Spending Plan) for any other private development in the City for which the HRA finds that the private development will create or retain jobs in the State (including construction jobs). Through the acquisition, substantial rehabilitation, and subsequent opening of the restaurant, Pizza Luce anticipates creating and/or retaining 15 full-time-equivalent jobs. Pizza Luce is projecting to expend $2,847,500 (not including the assistance provided by the HRA) for acquisition and rehabilitation. The rehabilitation activities will include installation of a new two-level kitchen, completely new dining room with seating for 140, new bathrooms, installation of an elevator, façade improvements, and the addition of a new outdoor dining patio. A complete list of improvements is attached to the Funding Agreement as Exhibit B. Without the HRA's assistance, the renovation would be to a much lesser scale and would include fewer amenities and improvements. The assistance through the HRA is proposed to be granted in the form of a deferred loan. The loan will bear no interest nor require any payments (except in the event of a default), and will be forgiven after five (5) years, or at project completion, whichever occurs first. Providing the requested assistance to the Developer for the project pursuant to the Funding Agreement is an eligible use of the excess tax increment available for use under the approved Spending Plan. III. BASIS OF RECOMMENDATION A. POLICY • Minnesota Statutes, Section 469.176, Subd. 4m, (the "temporary TIF Authority Act") authorizes the HRA to spend available tax increment from any existing tax increment financing district to provide assistance in any form to private development consisting of construction or substantial rehabilitation of buildings and ancillary facilities provided: o Such assistance will create or retain jobs in the State of Minnesota, including construction jobs; o Construction commences before July 1, 2012 for private commercial development; o The construction would not have commenced before that date without the assistance; o Tax increments under the Spending Plan are spent by December 31, 2012; and o The City Council approves a written spending plan after conducting a duly noticed public hearing that specifically authorizes the HRA to take such actions. B. CRITICAL TIMING ISSUES • Pizza Luce is scheduled to complete the remodel and formally open in June, 2012 C. FINANCIAL • A total of$951,445 in excess tax increment has been identified under the Spending Plan. • A current balance of$301,445 remains available for this funding assistance. • A balance of$51,445 would remain if Pizza Luce is awarded the full $250,000 in assistance. • Pizza Luce is seeking $250,000 to aid in the acquisition and rehabilitation of the former Bridgeman's Restaurant. D. LEGAL • The HRA attorney drafted the Funding Agreement IV. ALTERNATIVE RECOMMENDATION(S) • Do not approve the Funding Agreement. V. ATTACHMENTS • Resolution • Funding Agreement VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Representatives of Pizza Luce s- � RESOLUTION NO. HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, MINNESOTA RESOLUTION APPROVING THE EXECUTION AND DELIVERY OF A FUNDING AGREEMENT BETWEEN THE RICHFIELD HRA AND [PIZZA LUCE ENTITY] WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield (the "Authority") and the City of Richfield (the "City") have previously established the Interchange Tax Increment Financing District and the Lyndale Gardens Tax Increment Financing District (collectively, the "TIF Districts") within the Richfield Redevelopment Project Area and adopted tax increment financing plans therefor, pursuant to Minnesota Statutes, Sections 469.001 to 469.047, as amended, and Sections 469.174 to 469.1799, as amended; and WHEREAS, Minnesota Statutes, Section 469.176, Subd. 4m (the "Temporary TIF Authority Act") authorizes the Authority to spend available tax increment from any existing tax increment financing district, notwithstanding any other law to the contrary, to provide improvements, loans, interest rate subsidies, or assistance in any form to private development consisting of construction or substantial rehabilitation of buildings and ancillary facilities, if certain conditions are met; and WHEREAS, at its meeting on July 25, 2011, the Authority approved a spending plan for the TIF Districts in accordance with the Temporary TIF Authority Act (the "Spending Plan") to utilize existing tax increment revenues from the TIF Districts in order to stimulate construction or rehabilitation of private development in a way that will also create or retain jobs; and WHEREAS, on August 9, 2011, the City Council of the City held a public hearing regarding the Spending Plan and approved the Spending Plan; and WHEREAS, [Pizza Luce Entity], a Minnesota corporation (the "Developer") has requested assistance from the Authority under the Spending Plan in the amount of$250,000 to assist in the financing of the acquisition and substantial rehabilitation of the former Bridgeman's building located at 800 66th Street West in Richfield, Minnesota and legally described in the attached Exhibit A (the "Property"). WHEREAS, the Board of the Authority has been presented with a Funding Agreement, between the Authority and the Developer (the "Funding Agreement"), pursuant to which the Authority will provide $250,000 of the funds available under the Spending Plan to the Developer to acquire and rehabilitate the Property under certain terms and conditions; and WHEREAS, pursuant to the Funding Agreement, $250,000 in assistance will be provided to the Developer as a forgivable loan secured by a second mortgage on the Property; and 39533lv1 JAE RC125-320 WHEREAS, the Authority has reviewed the Funding Agreement and finds that the execution of the same and the Authority's performance of its obligations thereunder are in the best interest of the City and its residents; and NOW, THEREFORE, BE IT RESOLVED, by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota as follows: 1. The Funding Agreement presented to the Authority and on file with the Community Development Director is hereby in all respects approved, subject to modifications that do not alter the substance of the transaction and that are approved by the Chairperson and Executive Director; provided that execution of such document by such officials shall be conclusive evidence of approval. 2. The Chairperson and Executive Director are hereby authorized to execute the Funding Agreement on behalf of the Authority and to carry out on behalf of the Authority the Authority's obligations thereunder. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 19th day of December, 2011. Suzanne M. Sandahl, Chair ATTEST: Secretary 2 39533lv1 JAE RC125-320 5 FUNDING AGREEMENT THIS FUNDING AGREEMENT (the "Funding Agreement"), made and entered into as of the day of , 20 by and between, the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota, a Minnesota public body corporate and politic (the"Authority")and Pizza Luce VII, Inc. a Minnesota corporation(the"Developer"). BACKGROUND On August 9, 2011, the Richfield City Council approved a spending plan (the "Spending Plan") which authorizes the Authority to expend current cash balances on hand from two tax increment district for activities which will generate jobs and which are commenced not later than July 1,2012. Pursuant to the Spending Plan,the HRA is authorized to spend Available Spending Plan Increment (as defined in the Spending Plan) for any other private development in the City for which the HRA finds that the private development will create or retain jobs in the State (including construction jobs); that the private development will commence before the required date (depending on the type of development); and that such construction would not have commenced before the required date without the assistance under the Spending Plan. The Developer has requested assistance from the Authority in the amount of$250,000 to assist in the financing of the acquisition and substantial rehabilitation of the former Bridgeman's building located at 800 66U' Street West in Richfield, Minnesota and legally described in the attached Exhibit A (the "Property"). The Developer will commence substantial rehabilitation activities on the Property, as described in the attached Exhibit B, following the purchase of the Property,and prior to July 1,2012. The Authority has agreed to grant the Developer's request and provide such funding in accordance with the terms herein. NOW THEREFORE, in consideration of the mutual covenants and undertaking and understandings of the parties, the sufficiency of which is hereby acknowledged, the parties agree as follows: I.ASSISTANCE PROVIDED 1.01 Authority Funding of Certain Activities. The Authority agrees to provide funds to the Developer in the amount of up to $250,000 to assist the Developer in the acquisition and substantial rehabilitation of the Property. The funds will be provided to the Developer at the closing on the Developer's purchase of the Property upon the Authority being reasonably satisfied, based on assurances from the Developer, that: (i) the Developer has sufficient additional funds, including Developer equity, to pay the full purchase price for the Property; (ii)the Developer has or will obtain sufficient funds, including Developer equity, to pay the cost of the rehabilitation activities described on the attached Exhibit B, and has or will enter into contracts providing for such work; (iii)the rehabilitation activities will create or retain jobs in the 395323v2 JAE RC125-320 1 state, including construction jobs; (iv) construction will commence before July 1,2012, and would not have commenced before that date without the assistance; (v) the funds will be expended for acquisition or rehabilitation activities prior to December 31,2012 (a closing statement showing that at least$250,000 was paid at closing for the purchase of the Property will satisfy that requirement); and (vi)the jobs described in Section 1.09 will be created during the completion of the rehabilitation activities described in Exhibit B. 1.02 Source of Assistance. The funds provided hereunder are from the sources identified in the Spending Plan approved by the City Council on August 9, 2011 and approved by the Board of the Authority on July 25, 2011, and from no other source. Neither the City nor the Authority shall have any obligation to provide funds beyond the amounts available under the Spending Plan. 1.03 Form of Assistance. The Assistance will be provided in the form of a loan in the principal amount of$250,000. 1.04 Loan. The loan shall not accrue interest. The full principal amount of the loan will be due and payable on , 20_ [5 years from closing date] unless earlier accelerated by default of the Developer,or released pursuant to Section 1.05. 1.05 Loan,Release. The loan will be released and forever discharged at any time prior to , 20_ [5 years from closing date], upon: (i) the Developer providing the Authority with sufficient evidence that the rehabilitation activities described in Exhibit B have been completed as certified by the Richfield Building Official; and (ii) the Developer providing the Authority with written evidence,in the form of a certificate from the construction manager of the rehabilitation activities, that the jobs described in Section 1.09 were created. Upon satisfaction of these requirements, the Authority will provide the Developer with an instrument in recordable form discharging and releasing any mortgage described in Section 1.06 below. 1.06 Loan, Security. The loan will be secured by a mortgage in substantially the form of the attached Exhibit C. The mortgage will be initially recorded by the Developer against the Property. 1.07 Security. Subordination. The Authority acknowledges that its mortgage on the Property will be subordinate to the lien of a loan provided to the Developer by [FIRST MORTGAGE LENDER] for the acquisition and rehabilitation of the Property secured by a mortgage in the amount of$250,000. 1.08 Assistance not a Business Subsidy. The parties acknowledge that the assistance provided by the Authority to the Developer under this Funding Agreement is not a business subsidy pursuant to Minnesota Statutes, Sections 116J.993 to 116J.995 (the "Business Subsidy Act"). Pursuant to Section 116J.993, subd. 3(17), financial assistance provided to a developer whose investment in the purchase of a site and site preparation is 70% or more of the assessor's current year's estimated market value of such site is not a business subsidy. The assessor's current year's estimated market value for the Property is $897,000. The Developer anticipates expending approximately $2,847,500 (not including the assistance provided by the Authority in 395323v2 JAE RC125-320 2 5 -5 the amount of$250,000) to acquire and rehabilitate the Property, which amount is more than 70%of the assessor's current year's estimated market value. 1.09 Job Creation Requirement. The Developer has agreed to cause the creation of at least 10 new full-time equivalent construction jobs at the Property. 1.10 Developer Covenant Regarding Assistance. The Developer acknowledges that it would not have commenced the acquisition and rehabilitation of the Property at this time without the assistance provided pursuant to this Funding Agreement. II.ADDITIONAL PROVISIONS 2.01 Conflict of Interests; Authority Representatives Not Individually Liable. The Authority and the Developer, to the best of their respective knowledge, represent and agree that no member, official, or employee of the Authority shall have any personal interest, direct or indirect, in the Funding Agreement, nor shall any such member, official, or employee participate in any decision relating to the Funding Agreement which affects his personal interests or the interests of any corporation, partnership, or association in which he is, directly or indirectly, interested. No member, official, or employee of the Authority shall be personally liable to the Developer, or any successor in interest, in the event of any default or breach by the Authority or County or for any amount which may become due to the Developer or successor or on any obligations under the terms of the Funding Agreement. 2.02 Equal Employment Opportunity. The Developer, for itself and its successors and assigns, agrees that during the construction of the substantial rehabilitation provided for in this Funding Agreement it will comply with all applicable federal, state and local equal employment and non-discrimination laws and regulations. 2.03 Titles of Articles and Sections. Any titles of the several parts, Articles, and Sections of the Funding Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. 2.04 Notices and Demands. Except as otherwise expressly provided in this Funding Agreement, a notice, demand, or other communication under the Funding Agreement by either party to the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail,postage prepaid,return receipt requested,or delivered personally; and (a) in the case of the Developer, is addressed to or delivered personally to the Developer at Pizza Luce Management,401 Second Ave N#210,Minneapolis,Mn 55401 Attn: JJ Haywood; (b) in the case of the Authority, is addressed to or delivered personally to the Authority at 6700 Portland Avenue South, Richfield, MN 55423, Attn: Community Development Director; 395323v2 JAE RC125-320 3 5 ' r or at such other address with respect to either such party as that party may, from time to time, designate in writing and forward to the other as provided in this Section. 2.05 Counterparts. This Funding Agreement may be executed in any number of counterparts,each of which shall constitute one and the same instrument. 2.06 Recording. The Authority may record a memorandum of this Funding Agreement and any amendments thereto with the Hennepin County recorder. The Developer shall pay all costs for recording. 2.07 Costs of Authority. Prior to the Authority providing the assistance to the Developer described in Section 1.01, the Developer shall pay the Authority for all costs and expenses incurred by the Authority to provide such assistance, including administrative costs, attorney's fees and expenses. (The remainder of this page is intentionally left blank.) 395323v2 JAE RC125-320 4 5 --1 IN WITNESS WHEREOF, the Authority has caused this Funding Agreement to be duly executed in its name and behalf and its seal to be hereunto duly affixed and the Developer has caused this Funding Agreement to be duly executed in its name and behalf as of the date first above written. HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD,MINNESOTA By: Its: Chair (SEAL) By: Its: Executive Director STATE OF MINNESOTA ) ) SS. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this day of 20_,by Suzanne M. Sandahl,the Chair of the Housing and Redevelopment Authority in and for the City of Richfield,Minnesota,on behalf of the Authority. Notary Public STATE OF MINNESOTA ) ) SS. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this day of 20_, by Steve Devich, the Executive Director of the Housing and Redevelopment Authority in and for the City of Richfield,Minnesota,on behalf of the Authority. Notary Public 395323v2 JAB RC125-320 S-1 - S [PIZZA LUCE ENTITY] By: C)4k)(1 Its: c_60 tir COLLEEN M.JOHNSON STATE OF MINNESOTA • ,� Notary Public Minnesota ) SS. My Commission Expires January 31,2013 COUNTY OF HENNEPIN ) ��— — ——— —-- — — — Jee, The fore oing instrument w s acknowledged before me this /3 day of 201.1, by 3vit tG 140...q good , the Cr. 0 of [Pizza Luce Entity], o behalf of the corporation. 4.6geeijh totilfred„.„ Notary Public 395323v2 JAE RC125-320 S-2 S r cl EXHIBIT A LEGAL DESCRIPTION OF PROPERTY TO BE ACQUIRED Tracts A,B and D,registered land survey no. 642,Hennepin County Minnesota 395323v2 JAE RC125-320 A-1 Io EXHIBIT B SUBSTANTIAL REHABILITATION ACTIVITIES Pizza Luce will be doing a complete gut renovation of the old Bridgeman's restaurant on 66th Street. This renovation will include: • new two level kitchen • new dining area with seating for about 140 • new bathrooms in the lower level • addition of an elevator • replacement of dated mechanical and roofing systems and insulating the building • electrical and plumbing upgrades • making ADA improvements to the existing building • façade improvements to the building including adding a patio across the 66th Street face of the building • rehabilitating and reconfiguring the lot to maximize parking • incorporating new landscaping and exterior signage 395323v2 JAE RC125-320 A-1 It EXHIBIT C MORTGAGE P. O.Box 198 Kennedy&Graven This Indenture made this _ day of , 20 , between PIZZA LUCE VII, INC, a Minnesota corporation, Mortgagor, and THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, MINNESOTA,a Minnesota public body corporate and politic under the laws of the State of Minnesota,Mortgagee. Witnesseth: That the said Mortgagor, in consideration of the sum of One ($1.00) Dollar and other good, valuable and sufficient consideration, the receipt whereof is hereby acknowledged, does hereby Grant, Bargain, Sell, and Convey unto the said Mortgagee, its successors and assigns, Forever, all the tracts or parcels of land lying and being in the County of Hennepin and State of Minnesota,described as follows,to-wit: The separate tracts and parcels of land described in the attached Schedule I. (The"Property") To Have and to Hold the Same, Together with the hereditaments and appurtenances thereto belonging to the said Mortgagee, its successors and assigns, forever. And the said Mortgagor, for itself,and its successors and assigns,does covenant with the said Mortgagee, its successors and assigns, as follows: That it is lawfully seized of said premises and has good right to sell and convey the same; that the same are free from all encumbrances, save and except reservations, restrictions and easements of record; that the Mortgagee, its successors and assigns, shall quietly enjoy and possess the same; and that the Mortgagor will Warrant and Defend the title to the same against all lawful claims not hereinbefore specifically excepted. Provided,Nevertheless, That if said Mortgagor, its successors and assigns, shall keep and perform each and every one of its obligations under and pursuant to Section 1.05 of that certain Funding Agreement dated as of , 20_ (the "Contract"), made and entered into between Mortgagor and Mortgagee, and shall keep and perform all the covenants and agreements herein contained, then this deed to be null and void, and to be released at the Mortgagor's expense. This Mortgage secures a principal debt in the amount of Two Hundred and Fifty Thousand Dollars ($250,000) payable by Mortgagor to Mortgagee under the terms of the Contract, and amendments thereto, between Mortgagor and Mortgagee. And the Mortgagor, for itself; and its successors and assigns, does hereby covenant and agree with the Mortgagee, its successors and assigns, to perform its obligations as above specified, to pay all taxes and assessments now due or that may hereafter become liens 395323v2 JAE RC125=320 B-1 5 - �a against said premises at least ten(10)days before penalty attaches thereto;to pay,when due, both principal and interest of all prior liens or encumbrances, and to keep said premises free and clear of all other liens or encumbrances;to commit or permit no waste on said premises and to keep them in good repair; to complete forthwith any improvements which may hereafter be under course of construction thereon, and to pay any other expenses and attorneys'fees incurred by said Mortgagee, its successors or assigns,by reason of litigation with any third party for the protection of the lien of this Mortgage. That Mortgagor,does further covenant and agree that if any lien for labor,skill or material shall be filed for record during the life of this Mortgage,upon or against the premises hereby mortgaged, the said Mortgagor will, within thirty (30) days after the date of its filing for record, either pay off the said lien and secure its satisfaction of record, or will protect the Mortgagee against any loss or damage growing out of its enforcement,by furnishing a bond for the same amount in the form and with the sureties to be approved by the Mortgagee. In case of failure to pay said taxes and assessments,prior liens or encumbrances, expenses and attorneys' fees as above specified, or to insure said buildings and deliver the policies as aforesaid, the Mortgagee, its successors or assigns, may pay such taxes, assessments, prior liens, expenses and attorneys' fees and interest thereon, or effect such insurance, and the sums so paid shall bear interest at the highest rate permitted by law from the date of such payment, shall be impressed as an additional lien upon said premises, and be immediately due and payable from the Mortgagor, its successors or assigns, to said Mortgagee, it successors or assigns, and this Mortgage shall from date thereof secure the repayment of such advance with interest. In case of default in any of the foregoing covenants, the Mortgagor confers upon the Mortgagee the option of declaring a default and hereby authorizes and empowers said Mortgagee, its successors and assigns,to foreclose this Mortgage by judicial proceedings or to sell said premises at public auction and convey the same to the purchaser in fee simple in accordance with the statute, and out of the money arising from such sail to retain all sums secured hereby, with interest and all legal costs and charges of such foreclosure and the maximum attorneys' fee permitted by law, which costs, charges and fees the Mortgagor herein agrees to pay. 395323v2 JAE RC125-320 B-2 5 - 13 In Testimony Whereof, the said Mortgagor has hereunto set its hand the day and year first above written. 906104 ()Qv [PIZZA LUCE By: Its: C ) STATE OF MINNESOTA ) COUNTY OF HENNEPIN ) / The foregoing instrument was acknowledged before me this ` 3 day of r , 20B by `v i c. �wt.')f , the C co of [Pizza Luce Fr], o behalf of the corporation. Vt75itieze44. /-4-x-tes- (Notary Stamp or Seal) Notary Public This Instrument was drafted by: Kennedy&Graven,Chartered 470 U.S. Bank Plaza 200 South Sixth Street Minneapolis,MN 55402 (612)337-9300 395323v2 ME RC125-320 B-3 5 —VA SCHEDULE I TO MORTGAGE LEGAL DESCRIPTION Tracts A,B and D,registered land survey no. 642, Hennepin County Minnesota 395323v2 JAE RCI25-320 B-4 AGENDA ITEM#: 6 REPORT#: 56 STAFF REPORT RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY MEETING DECEMBER 19, 2011 REPORT PREPARED BY: JULIE URBAN/MICHELLE LEWIS, HOUSING SPECIALISTS NAME, TITLE REPORT PRESENTER: KAREN BARTON, ASSISTANT COMMUNITY DEVELOPMENT DIRECTOR NAME,TITLE DEPARTMENT DIRECTOR REVIEW: a i /AL.OREVIEWED BY EXECUTIVE DIRECTOR: n fie / 6 k 1 ITEM FOR HRA CONSIDERATION: Consideration of a contract with Stantec Consulting Services to conduct a Rental Housing Inventory and Needs Assessment. I. RECOMMENDED ACTION: By Motion: Authorize staff to execute a contract with Stantec Consulting Services to conduct a Rental Housing Inventory and Needs Assessment. II, BACKGROUND At the November 21, 2011 meeting, the Housing and Redevelopment Authority (HRA) was presented with a proposal from Stantec Consulting Services (Stantec) to conduct a Rental Housing Study to better understand the Richfield rental property market and subsequently the areas of need in the rental housing stock. The HRA requested additional information be submitted and the item was tabled to the December meeting. At the HRA's request, the consultant submitted a revised proposal that included: • An initial work session with the HRA. • More information about the City's housing composition and how it compares to that of other similar communities in the area. 12192011 Rental Housing Study Contract.doc • Specific review of the Metropolitan Council requirements for Richfield. With these clarifications, the primary goals of the Inventory and Needs Assessment remain the same: • Provide the HRA and staff with current data on the City's rental housing supply; and • Provide information about the broader rental housing market; and • Inform the HRA's response to rental housing development proposals. The revisions to the proposal increased the cost by $500 to $24,750. III. BASIS OF RECOMMENDATION A. POLICY • At their goal-setting session earlier this year, the HRA expressed interest in conducting a Rental Housing Study to better understand the existing rental housing stock and the needs for additional rental housing in Richfield. • The 2009 Richfield Comprehensive Plan Housing Goals and Policies direct the policy work related to Single Family and Multi-Family Housing in Richfield. Specifically this research is supported and encourage by the following goals and policies, stated in the 2009 Richfield Comprehensive Plan. o Goal: Maintain and enhance Richfield's image as a community with strong, desirable and livable neighborhoods. • Policies: • Support the rehabilitation and upgrading of the existing housing stock. • Support ongoing maintenance and upkeep of residential properties. • Ensure redevelopment and infill projects maintain the integrity of existing neighborhoods. • Maintain an appropriate mix of housing types in each neighborhood based on available amenities, transportation resources and adjacent land uses. o Goal: Ensure sufficient diversity in the housing stock to provide for a range of household sizes, income levels and needs. • Policies: • Promote the development of a balanced housing stock that is available to a range of income levels. • Encourage improvements to the housing stock to better serve families with children and seniors. • Promote additional housing diversity to serve families at all stages of their life- cycle through incentive programs, and the exploration of possible partnerships. • Regularly review land use and zoning ordinances to ensure maximum opportunities for development of housing. • Promote the development, management, and maintenance of affordable housing in the City through assistance programs; alternative funding sources; and the creation of partnership whose mission is to promote low and moderate income housing. B. CRITICAL TIMING ISSUES • Stantec will begin the study once a contract is executed. Stantec has proposed to complete the study in two to three months. C. FINANCIAL • While the Stantec proposal is not the lowest bid, their proposal (and other reports) offers the most useable document and tools for the HRA's needs at this time. • Funding is available in the 2011 HRA budget. D. LEGAL • Legal counsel will prepare the consultant contract. IV. ALTERNATIVE RECOMMENDATION(S) • Direct staff to execute a contract with Maxfield Research or Community Partners Research. V. ATTACHMENTS • Stantec Proposal, Revised 11-30-2011 VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Jay Demma, Stantec Stantec Consulting Services Inc. itaii\sAk— 2335 Highway 36 West St.Paul MN 55113 Tel:(651)636-4600 Fax:(651)636-1311 Stantec 4 Bonestroo November 30, 2011 Julie Urban & Michelle Lewis, Housing Specialists Richfield Housing and Redevelopment Authority City of Richfield 6700 Portland Avenue South Richfield, MN 55423 Reference: Richfield Rental Housing Inventory and Needs Assessment Dear Ms. Urban and Ms. Lewis: Thank you for inviting us to submit a revised proposal of services to complete a Rental Housing Inventory and Needs Assessment for the City of Richfield.We understand the logistics of a study of this scope and have developed an energetic, creative plan to assemble and analyze the information crucial to informing local decision makers about future housing development. Several aspects of our team and approach set Bonestroo, now Stantec, apart from the competition: • Our in-house GIS capabilities will enable us to analyze data on a more focused level. The detailed characteristics available through GIS cannot be duplicated through traditional "arms-length" research methods.We will put the power of GIS to work for the City of Richfield. • We will deliver a highly user-friendly document that effectively communicates the key findings from our research. Housing studies can easily become cumbersome documents, packed with countless tables and extended narrative descriptions.We pride ourselves in our ability to hone in on the key pieces of information that affect decision-making, presenting our findings in user-friendly charts and graphics, explained through concise text. • We recognize this is a significant project, and we do not underestimate the scope of the research.We will deliver a product that gives the City of Richfield and the HRA accurate, timely, and helpful information to facilitate discussions and decision-making based in the realities of the local housing market. FIRM DESCRIPTION Bonestroo recently joined Stantec, a firm of 11,000 staff members and 170 offices. Founded in 1954, Stantec provides professional consulting services in planning, engineering, architecture, interior design, landscape architecture, surveying, environmental sciences, project management, and project economics for infrastructure and facilities projects. Continually striving to balance economic, environmental, and social responsibilities, Stantec is recognized as a world-class leader and innovator in the delivery of sustainable solutions. We support public and private sector clients in a diverse range of markets in the infrastructure and facilities sector at every stage, from initial concept and financial feasibility to project completion and beyond. a Stantec November 30,2011 Richfield Rental Housing Inventory Page 2 of 8 CONTACT PERSON Jay Demma Phone: 651-967-4551 Email:jay.demma @stantec.com Jay Demma will lead this effort and serve as project manager. He will be supported by Hongyi Duan, a GIS specialist. We have enclosed resumes for each team member with this submittal for your review. HOUSING STUDIES EXPERIENCE Stantec's market research team has extensive experience conducting market studies for all types of housing, ranging from single-family subdivisions to all forms of multifamily housing, including the various types of senior housing. Moreover, while working for another firm, Jay Demma completed a comprehensive assessment of senior housing needs for the City of Richfield in 1996 and subsequently conducted several private sector, project-specific market studies within the City as well. The following are more recent examples of the housing related research Stantec has conducted. Forest Lake, MN—Comprehensive Housing Study Stantec conducted a comprehensive housing ® 0 City of Forest Lake study for the City of Forest Lake as part of an O • Rental Market FIGURE q initiative to amend the City's comprehensive r�' • o ti "` _f plan. ..w, 0 • 0 •The housing study included a detailed analysis • " of demographic and economic conditions in the City and surrounding communities. �•° In addition, a thorough survey of for-sale, rental • ` (market rate and subsidized), and senior ® = ri,_. housing was conducted in order to assess current and forecasted market conditions. r• es. The study revealed two important findings: 1) • the market for for-sale housing had decreased significantly from recent years; and 2)there was a critical gap in the supply of affordably-priced rental housing, especially for units with three or more bedrooms. Based on the findings, Stantec recommended that the City consider adopting policies that would support the development of affordable rental housing and that there was no immediate need to increase the supply of available lots for development of for-sale housing. Since completion of the study, Forest Lake has adopted Minnesota's first inclusionary housing policy and has experienced the development of over 300 affordable rental housing units. REFERENCE: Doug Borglund, Community Development Director 651-464-3350 (o -3 Stantec November 30,2011 Richfield Rental Housing Inventory Page 3 of 8 Greater Minnesota Housing Fund—Northeast Minnesota Dynamic Housing Model Stantec worked with the Greater Minnesota Housing Fund to develop a dynamic housing model that is designed to allow local officials in Itasca and St. Louis counties to plan and prepare for large-scale economic t ""`° a a development. t As part of this innovative modeling process, f Stantec benchmarked the current supply of - - ' - Proposed Study Area Bourdon. housing at different price points in the two ,--- ` counties. The benchmark includes a survey j j '`;, } of available for-sale and rental housing ! •., 1 ' '"' throughout the study area. , grow^e r Based on this benchmark, an interactive tool was developed that allows users to test different job growth scenarios and the resultant impact on the housing market. For example, if 1,500 jobs were proposed in the town of Nashwauk, a local official can use the model to determine where the impact will be most felt in the local housing market. Moreover, the data collection methods established during the benchmark phase were streamlined so periodic updates can be performed on a regular basis insuring that the data in the model is as accurate and current as possible. REFERENCE: Warren Hanson, President 651-221-1997 North St. Paul—Downtown Multifamily Housing 2010 Trade Area Tenure by Age of Householder 12,000 14043 Study 10,000 8996 Stantec conducted a market study to determine 7,871 potential support for new development of 8,000 6,220 multifamily housing in Downtown North St. 6,000 4000 Paul. The study analyzed the demand for r market rate and affordable multifamily housing, gi 2,000 -- ' _. ■Owners including both general-occupancy and age- _ °restricted concepts. Data was collected on the 2,000 - 1,250-1,176_-_1,023 ■Renters demographic and economic conditions within a 4,000 --2,669 defined trade area and then compared against 6,000 - 4,319 3,833 the existing supply of multifamily housing in 8,000 - 5,873 order determine the level of unmet or over-met Under 25-34 35-44 45-54 55-64 65-74 75-84 85+ need. 25 Age of Householder Source:2010 US Census Based on strong forecasted growth in key demographic categories, an extremely tight rental market with low vacancy, and a general lack of newer product with desirable amenities, it was concluded that there is strong demand to support new development. Despite the high level of calculated demand, it was recommended that any new development should respect modest income levels found in the trade area and that any new project should not exclusively target the most affluent of renters but middle-and low-income households as well. REFERENCE: Nate Ehalt, Community Development Director 651-747-2595 6 -q Stantec November 30, 2011 Richfield Rental Housing Inventory Page 4 of 8 RELEVANT WORK FOR PUBLIC ENTITIES Following is a selected list of relevant work performed for public entities over the past several years. • Forest Lake, MN—Comprehensive Housing Study • Iron Range Resources/GMHF—Housing Demand Model • North St. Paul, MN— Downtown Multifamily Housing Study • Plymouth, MN—Senior Housing Demand Analysis(site of Four Seasons Mall) • Newport, MN—Housing Demand Analysis • South St. Paul, MN—Housing Demand Analysis (Concord Street Corridor Study) • Oakdale, MN—Housing Demand Analysis (site of former Oakdale Mall) • Isanti, MN—Housing Market Study • Hennepin County—TOD Station Area Study(Southwest Corridor) • Washington County—TOD Station Area Study(Red Rock Corridor) • Corcoran, MN—Commercial Land Needs Assessment • Sauk Rapids, MN—Commercial Land Needs Assessment • Mounds View, MN—Redevelopment Market Potential Study • Plymouth, MN—Retail Market Study • Lino Lakes, MN—Land Use Market Assessment • Dayton, MN—Land Use Market Assessment • Ramsey, MN—Land Use Market Assessment • Blaine, MN—Land Use Market Assessment • Rochester, MN—Corridor Study • Stillwater, MN—Downtown Housing Demand Analysis • Shakopee, MN—Park Space Demand Analysis SERVICE DELIVERY EXPERIENCE AND ANALYSIS STRATEGY The City of Richfield wishes to complete a Rental Housing Inventory and Needs Assessment to evaluate current housing conditions and project future housing needs.This study will quantify the availability and need for market rate and income-restricted rental housing. Local officials require the updated information to make informed decisions on housing development policies, public resource expenditures, and to prioritize housing programs. This research program, proposed by Stantec,would give local stakeholders and decision-makers a comprehensive update on current housing conditions and the various factors affecting future rental housing needs in the City of Richfield. The research would develop recommendations to directly address identified housing needs in the multifamily rental and senior housing markets. The research team at Stantec has extensive experience conducting housing studies for both public and private sector clients. Our team has conducted over 100 market studies for senior housing in 24 states, including everything from cooperatives to assisted living to skilled nursing care.We have also completed dozens of studies throughout the Twin Cities for market rate and subsidized multifamily developments. Our work program is designed to create a solid foundation of base information to enable the City and the HRA to continually re-evaluate trends and conditions as the decade progresses. We would conduct personal interviews with local officials, Realtors/sales agents, property managers, residential developers and social service providers to tap the collective knowledge of those most familiar with the strengths and weaknesses of the current housing market.We believe our approach provides flexibility to accommodate the needs of participating entities, but welcome a discussion of ways it could be adjusted to better serve the City of Richfield's needs. The final completed study will include pertinent findings, including summary tables and graphics,various maps developed by our in-house GIS staff, interview summaries, and our recommendations for addressing current and projected housing needs. (0- s Stantec November 30,2011 Richfield Rental Housing Inventory Page 5 of 8 PROJECT APPROACH What follows is a description of each task in our work program. We believe the overall work program will produce a meaningful and responsive rental housing assessment for the City of Richfield, and serve as a solid framework for the HRA and other development entities to adequately prepare for the City's projected growth. Task 1 —Project Initiation Meetings Before any work begins, Stantec will meet with the HRA Board at a scheduled work session to set the study's framework.As a follow-up to the work session, Stantec's research team will meet with City staff and appropriate HRA Board members. The purpose of this meeting will be to: . Review study objectives based on discussion from HRA work session • Refine the work program for the study • Resolve any questions regarding contract interpretation . Assign responsibilities to each participant regarding the various tasks in the work program . Establish a firm basis for all participants working together to complete the assessment in an orderly manner Task 2-Data Collection To deliver an effective study for the budget that has been set, it is essential for the City to provide all the information and existing studies needed to complete an accurate analysis of existing housing conditions. At and subsequent to the kick off meeting, we anticipate obtaining and assembling critical data/information, including: . Relevant plans and studies, including the 2004 housing study, the most recent comprehensive plan for the City, and any other recent market studies that have addressed housing needs within the City • Building permit data for residential units constructed and demolished since 2000 summarizing type of project, size, location, and number of units . GIS data for the City, including: 1. Existing and future land use 2. Assessor data for parcels in the study area, including: a. Estimated market value of land b. Estimated market values of structures c. Property owner name d. Age of structure e. Homestead status . Record of rental housing projects currently in the development process, including everything from pre-development concepts to projects currently under construction . Identification of sites considered to be a potential opportunity for redevelopment according to City staff . Data on the number of housing choice vouchers available to City residents and size of the waiting lists . Data from the City's rental licensure program,which would be used to better understand recent trends in tenure Task 3—Inventory of Rental Housing Stantec will augment data collected from the City in Task 2 with primary and secondary data, including sources such as, but not limited to, the US Census, Housing Link, and Minnesota Housing,to create an inventory of rental housing in Richfield. Data collected as part of the rental inventory will be maintained in a spreadsheet/database and provided to the City at the conclusion of Task 3 for on-going use after the study's completion. Furthermore, the data included in the inventory will be summarized in a matrix and, as appropriate, a series of graphs, charts, and maps intended to easily visualize and make comparisons among key data points. For example, one set of comparisons will include ratios of each housing characteristic to the total number of housing units.Additional comparisons may include the percentage affordable units within certain age 6 -Co Stantec November 30,2011 Richfield Rental Housing Inventory Page 6 of 8 categories. Stantec will work with City staff to determine which types of comparisons may be the most valuable and necessary for inclusion in the final report. In addition to data specific to Richfield, Stantec will also collect comparable housing stock data for surrounding communities(e.g., Bloomington, Edina, St. Louis Park, and select neighborhoods in South Minneapolis), especially with respect to affordable housing units broken down by those that are rented or owned. The foundation of the Rental Inventory will be key characteristics of the housing stock, which are as follows: Characteristics of Rental Housing Stock • Unit age (i.e., year built) • Unit type(eg., single-family detached, single-family attached, 3-4 unit buildings, 5+ unit buildings) • Unit size(i.e., number of bedrooms) • Units with income-restrictions (i.e., subsidized vs market rate) • Units serving special populations (e.g., seniors) • Units lost and replaced since 1990 • Vacancies • Rent • Number and size of units by affordability category(very low income to luxury) • Features and amenities by affordability category(e.g., appliances, underground parking, pool, community room, etc.) In order to make comparisons between the nature of the housing stock and its inhabitants, additional data on the characteristics of renter households will be collected as well,which are as follows: Characteristics of Renter Households • Age of households • Household size • Household type • Race • Length of occupancy • Income • Rent burden In addition to collecting and analyzing quantitative data, qualitative data based on interviews and a windshield survey will be collected and summarized as well to provide a fuller perspective of the current rental housing situation in Richfield. Housing Condition • Interviews with select City staff, owners, and/or property managers to qualitatively assess the overall condition of the rental housing stock • Windshield survey of rental neighborhoods/properties to gauge overall condition of housing stock Task 4—Analysis of Needs . Building upon data collected in Tasks 2 and 3, Stantec will complete an analysis of the demographic and economic trends impacting demand for rental housing in Richfield and compare those trends against the condition and supply of the existing housing stock. This analysis will help City staff and the HRA Board to determine what, if any, unmet needs exist in the City's current supply of rental housing. A key component of the needs analysis will be to review the Met Council's current requirements for new affordable housing in Richfield.As part of the Land Planning Act,the Met Council periodically assesses the future need for affordable housing in the region and apportions this need to individual communities. Based on review Met Council's requirement, Stantec will identify Richfield's forecasted affordable housing requirement and compare this against its current supply. 6- � Stantec November 30, 2011 Richfield Rental Housing Inventory Page 7 of 8 To complete this task, Stantec will coordinate data from the U.S. Census, Metropolitan Council, Minnesota State Demographer and other regional and local agencies as appropriate. Primarily, Stantec will analyze the following indicators: . Population/household growth trends and forecasts for Richfield as well as surrounding communities . Age distribution of the population, both current and projected, in Richfield and surrounding communities . Change in household tenure (renter/owner household comparison) in Richfield and surrounding communities . Distribution of household income by age in Richfield and surrounding communities . Employment growth trends and forecasts by industry in Richfield and surrounding communities . Status of pending rental housing projects in surrounding communities and an assessment of how such projects will impact the rental housing market in Richfield . Broader rental housing market trends, such as metro-wide vacancy rates, average rents, and profiles of new developments Task 5—Tools and Policies Based on the results of Tasks 1 through 4, Stantec will provide information on tools and policies that may address any unmet rental housing needs in the community. However, because no tool or policy is a one-size- fits-all solution, Stantec will tailor the recommendations to fit the circumstances and conditions unique to Richfield. Examples of potential tools and policies that may be considered include small area planning,zoning changes, strategic infrastructure investments, site acquisition, density bonuses, fee waivers, inclusionary housing ordinances, public-private partnerships, housing code adjustments, site clean-up assistance, etc. Task 6—Report Preparation Stantec will prepare a report that describes the information and analysis developed in Tasks 1 through 5.The report will include text, maps, tables, and other descriptive summaries of the distinct characteristics of the Richfield rental market. The report will be provided in an electronic PDF format. If so desired, bound copies of the report can be made available at standard Stantec printing rates. Task 7—Presentation of Findings Upon finalization of the study, Stantec will present the findings of the Rental Housing Inventory and Needs Assessment to City staff and officials. PROPOSED TIMEFRAME It is anticipated that the tasks outlined above would be completed within 60 days from the initiation meeting and contract execution. COMPENSATION AND HOURS We propose to complete the Rental Housing Inventory and Needs Assessment for$24,750, not including reimbursable expenses, as detailed below. Task Cost Schedule Task 1: Project Initiation Meetings $1,000 Week 1 Task 2: Data Collection $1,500 Weeks 1-2 Task 3: Inventory of Rental Housing $10,625 Weeks 1-6 Task 4:Analysis of Needs $5,125 Weeks 6-7 Task 5: Tools and Policies $1,250 Weeks 7-8 Task 6: Report Preparation $3,750 Week 8 Task 7: Presentation of Findings $1,500 TBD TOTAL COST ' ' $24,750 Stantec November 30,2011 Richfield Rental Housing Inventory Page 8 of 8 Note: Total cost does not include reimbursable expenses such as data purchases and mileage. These expenses will not exceed$250, but could be substantially less. The estimated hours to complete the assessment would be 185 hours. Project team billing rates are$125 per hour for Jay Demma and $91 per hour for Hongyi Duan. The billing rates include salary, audited overhead, and profit. DISCLAIMER The objective of this research assignment is to gather and analyze as many market components as is reasonable within the time limits and projected staff hours set forth in this agreement. Certain information and statistics contained in the report,which are the basis for conclusions of the report, will be furnished by other independent sources. While we believe this information to be reliable, it has not been independently verified by us, and we assume no responsibility for its accuracy. The conclusions in the report are based on our best judgments as market research consultants.The result of the proposed research project may be achieved, but also may vary due to changing market conditions in the real estate industry, changes in data formats or availability, changes in facts that were the basis of conclusions in this report, or other unforeseen circumstances. SUMMARY We look forward to speaking with you further about this exciting project, and are available to answer questions or modify our proposal to best fit your needs. If you have questions about our submittal, please contact me directly at 651-967-4551. We look forward to working with the City of Richfield. Thank you for your time and consideration. Respectfully, STANTEC CONSUL NG SERVICES INC. -, /y ■-mma Project Manager Tel: 651-967-4551 Email:jay.demmaCa.stantec.com PROJECT MANAGER/MARKET RESEARCH SPECIALIST Jay M. Demma Qualifications for City of Richfield — Rental Housing Inventory and Needs Assessment Jay has a 16-year background in demographic and economic analysis, and has held a variety of staff and executive positions at leading research firms in the Twin Cities and Philadelphia. At Stantec, Jay directs all research projects in the Upper Midwest relating to the demographic and economic impacts of land use change. Jay has worked on hundreds of research and consulting assignments throughout the United States, providing research expertise on virtually all land use types, especially housing, commercial/mixed-use and urban redevelopment. Relevant Experience EDUCATION • COMPREHENSIVE HOUSING STUDIES University of Minnesota Jay has conducted numerous comprehensive housing studies for Master of Urban and Regional cities, counties, and housing and redevelopment authorities. Planning These studies include a thorough analysis of the socio-economic University of Minnesota Bac helor of Science make-up of communities to identify critical gaps in the supply of Geography housing. Critical to the research process is understanding how gaps in the supply of different types of housing can negatively PROFESSIONAL ORGANIZATIONS impact the local population. American Planning Association (APA) • SENIOR HOUSING STUDIES Sensible Land Use Coalition Jay is a leading expert in the senior housing market. Since 1995, (sl uc) Jay has completed studies in 17 states, Urban Land Institute(ULI) P leted over 150 senior housing Economic Development authored newspaper articles on the topic, and has spoken to Association of Minnesota numerous local boards. While Vice President of Maxfield Research, (EDAM) Jay directed a majority of the firm's senior housing business and oversaw its annual survey of Twin Cities senior housing. • DEMOGRAPHIC AND ECONOMIC ANALYSIS Jay has analyzed the demographic and economic conditions of hundreds of communities. He uses numerous primary and secondary data sources for his analyses, including in-depth interviews, surveys(mail and phone), the U.S. Census, state demographic centers, and the Bureau of Labor Statistics. • ECONOMIC IMPACT STUDIES Jay has conducted economic impact studies of large, mixed-use real estate developments. A recent example was for the City of St. Paul where he analyzed the impact of a proposed 74-acre mixed- use development with approximately 1 million square feet of commercial space and 1,100 units of housing on the City's housing market and tax base. The analysis included demand forecasting as well as development of a fiscal impact methodology stantec Bonestroo Co - (o unique to St. Paul and the proposed project. • GREATER MINNESOTA HOUSING FUND - IRON RANGE HOUSING STUDY Jay worked with a regional housing task force to design and implement a state-of-the-art housing demand model based on projected employment growth in the mining industry. Jay directed all research activities and delivered key presentations to local, regional, and state officials regarding the study's findings. Jay's dynamic housing model is helping Iron Range officials to understand the impact of rapid job growth on housing demand, and has set the stage for a substantive public response to the impending need. • FOREST LAKE, MN - COMPREHENSIVE HOUSING STUDY Jay conducted a comprehensive housing study for the City of Forest Lake. By thoroughly analyzing the socio-economic composition of the City, Bonestroo was able to help the City identify viable housing options. Key socio-economic variables, such as age, household type, racial and ethnic composition, and household income were analyzed to determine important gaps in the current housing market. Based on the socio-economic make- up of the City's population, Bonestroo identified critical gaps in the City's housing supply; in particular, the lack of affordably priced rental units with three or more bedrooms • FILLMORE COUNTY - COMPREHENSIVE HOUSING STUDY Jay completed a comprehensive housing study for Fillmore County in southeastern Minnesota. Five distinct market areas within the County were analyzed, each centered on a community of between 1,000 and 2,500 people. Demand for housing at all income levels (low-income, affordable, and market rate) as well as by type (for- sale versus rental)was analyzed. In some market areas, demand was strong for all housing types. In other markets areas, demand for housing was constrained to second or seasonal homes related to an emerging tourist economy, which severely limited the supply of affordable housing. In still other market areas, Jay discovered a critical lack of certain housing types (e.g., rental units), which was forcing prospective residents to search outside the market area for housing. • DORAN PRATT DEVELOPMENT - MARKET FEASIBILITY STUDIES FOR LUXURY RENTAL APARTMENTS Jay conducted market feasibility studies for separate luxury rental projects located in Hopkins, MN and Eagan, MN. The feasibility studies assessed the supply and demand for luxury rental housing in each trade area and concluded there was sufficient demand to support each project. Based on market data, recommendations were made to the client regarding the optimal mix of units, square footages, features, and rents. Stantec 4 Bonestroo (o — 11 GIS MAPPING Hongyi Z. Duan - Qualifications for City of Richfield — Rental Housing Inventory and Needs Assessment Ms. Duan had working knowledge in both architecture and planning before joining Bonestroo. Hongyi works on a variety of projects including comprehensive plans, special studies, zoning studies, market research, condemnations, and urban design. Besides her expertise in various GIS, drafting, and graphic software, Hongyi provides leadership and project management. Relevant Experience EDUCATION • DAYTON, MN - 2030 COMPREHENSIVE PLAN Iowa State University Hongyi provides all GIS related mapping and analysis tasks for the Master of Science,Community and Regional Planning City of Dayton Comprehensive Plan. The City is growing and Beijing Polytechnic University needs to develop and implement planning tools to prepare for Bachelor of Science, growth impacts. The plan includes analyzing land use, natural Architecture resources, parks and open space, housing and other issues, COMPUTER EXPERIENCE including planning for a new I-94 interchange. Adobe Suite Arclnfo • RAMSEY, MN — 2008 COMPREHENSIVE PLAN UPDATE ArcView Hongyi provides all GIS related mapping and analysis tasks. The AutocAD City of Ramsey has been growing, CorelDraw Suite ty Y 9 9, particularly in the last five Microsoft Office Suite years. Their updated Comprehensive Plan included goals and policy development; project initiation, issue identification, PROFESSIONAL ORGANIZATIONS Urban Land Institute(ULI) inventory, and analysis; and plan preparation, refinement, and adoption. TRAINING Geographic Information • LINO LAKES, MN - COMPREHENSIVE PLAN UPDATE Systems University of Hongyi provided all GIS related mapping and analysis tasks to Minnesota,ESRI assist the City as they meet the requirements of Metropolitan Land Act by updating their comprehensive plan. • FOREST LAKE, MN — 2030 COMPREHENSIVE PLAN Hongyi provides all GIS related mapping and analysis tasks. Bonestroo is helping the City of Forest Lake update their comprehensive plan for 2030. • MINNEAPOLIS, MN — BASSETT CREEK VALLEY MASTER PLAN Hongyi worked closely with the City and the project team to map the area's current land-use, roads, population, and acreage. A long term development plan was created for this 300-acre, underutilized land at the doorway to downtown Minneapolis. New roads, trail, open space connections, and restoration of Bassett Creek provided new and invigorating possibilities for a forgotten Stantec Bonestroo area of Minneapolis. • MINNEAPOLIS, MN - LOWRY AVENUE CORRIDOR STUDY Hongyi mapped the five-mile corridor for this revitalization study. The background analysis involved detailed traffic analysis, research of potentially contaminated sites, historical analysis, and market research to identify the location, scale, and type of future development that would work along the corridor including landscaping, bike lanes, pedestrian amenities, and redevelopment of three major intersections. This study involved neighborhood meetings, interviews with elected officials, community leaders and business owners to developed the overall scheme. • STINSON TECHNOLOGY CAMPUS REDEVELOPMENT PLAN Hongyi provided the mapping and data analysis. This redevelopment plan involved approximately 30 acres of industrial land in northeast Minneapolis, creating a high-tech office campus by renovating existing historic buildings and replacing outdated structures with new construction. The plan included a hierarchy of streetscape treatments, an overall landscape planting concept, signage and gateway features. In addition, the design enhanced pedestrian circulation and connections. • MINNEAPOLIS, MN/MARCY-HOMES NEIGHBORHOOD - MASTER PLAN Hongyi worked closely with the project manager and the City of Minneapolis to map the neighborhood land-use patterns, land parcels and ownership. She also created the presentation graphics. With this master plan, the community will have a guide for future development. A set of objectives, policies and guidelines were developed to guide future development and improvements. These guidelines shaped the plan that identified housing and commercial opportunities, open spaces, tail connections, and transportation improvements. Stantec Bonestroo