Loading...
03-9307r I I I RESOLUTION NO. 9307 129 A RESOLUTION APPROVING SETTLEMENT OF PENDING LITIGATION WHEREAS, the City of Richfield is a party defendant in a legal action challenging the validity of certain zoning approvals granted by the City Council, which action is docketed in Hennepin County District Court as Walser Auto Sales. Inc.. et al. v. Citv of Richfield, Case No. AP01-005147 (the "zoning action"); and WHEREAS, the City of Richfield is a party defendant, together with the Housing and Redevelopment Authority in. and for the City of Richfield (HRA), in a legal action challenging the validity of the Interchange West tax increment financing district, which action is docketed in Hennepin County District Court as Walser Auto Sales, Inc. v. AP 00- 11927 (the "TIF action"); and WHEREAS, the HRA is the petitioner in a condemnation action docketed in Hennepin County District Court as Housing and Redevelopment Authority in and for the City of Richfield v. Walser Auto Sales. Inc.. et aI., Case No. CD-2604 (the "condemnation action"); and WHEREAS, the zoning action, TIF action and condemnation action all concern the same property, formerly owned by R. J. Walser, Paul Walser, Andrew Walser and other Walser-affiliated entities (the "Walsers"); and WHEREAS, the various actions are all related to the redevelopment of the property as the site of the corporate campus of Best Buy Co., Inc., which is a party to a Contract for Private Redevelopment with the HRA; and WHEREAS, representatives of the City, HRA, the Walsers and Best Buy Co., Inc. recently participated in a court-ordered mediation session for the purpose of reaching a negotiated settlement of the TIF action and other disputes among the parties. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield as follows: 1. It is in the best interests of the City to resolve the pending legal actions with the Walsers, including the zoning action and the TIF action. 2. The Mayor, City Manager and City Attorney are authorized and directed to execute appropriate settlement stipulation(s) that incorporate the settlement terms as enumerated on the attached Exhibit A, and to submit the settlement stipulation(s) to the Hennepin County District Court for approval. Dated this 14th day of February, 2003. ~~)W Martin J. Ki sc, ayor ATTEST: EXHIBIT A SETTLEMENT POINTS (Mediation) The City, HRA, Best Buy and Walser ihterests agree as follows: 1. Walser is to be paid ~1~.5 million (less the $9,450,228 previously paid) as a settlement amount. City/HRA will contriput~ $300,000 (funded by LMCIT insurance) . toward the settlement amount, and Best Buy will contribute the remainder. 2. Payment and terms herein are intend~d to settle all issues of compensation and interest in the condemnation case (HRA v. Walser Auto Sales, Inc., et aI., Henn. Co. District Court File No. CD-2604), all issues in TIF case (Walser Auto Sales. Inc., et al. v. City and HRA, Henn. Co. District Court File No. AP 00-11927), all issues in the zoning case (Walser Auto Sales, 11JC:' ,et al. v. City, Henn. Co. District Court File No. AP01- 005147) and all issues of attorneys' fees and costs in those actions. The relocation Claims of Walser, however, are not settled. 3. The zoning case will be dismissed with prejudice. 4. Appropriate court orders will pesubmitted jointly to court for approval. For the TIF case, the order will include, without limitation, findings that tax increment assistance to the Best Buy project serves primarily a public purpose. The order will direct the City and the HRA to conform their practices in establishing Redevelopment TIF Districts to address the concerns expressed in the Court of Appeals decision. The order will provide that the TIF District will be preserved in its entirety and will provide that the HRA shall continue to collect and distribute TIF proceeds as provided in the TIF Plan and the Development Agreement, as amended. I I I I I I 5. Development Agreement (HRAlBest Buy), is to be amended to restate the definition i:':;.<-<.:~\ <~;/,,;\:_>~~, . of Available Tax Increment, by providing for application of tax increment (prior to payments to Developer under the Note): i) to pay a fixed amount of administrative expenses having a present value of $1,000,000; ii) to pay a fixed amOl,Ult to the Housing Fund having a present value of $7,000,000; and, iii) to pay principal and interest on the TIF Bonds or TIF Refunding Bonds as those terms are used in the Development Agreement. The amendment will also revise the assessment agreement to provide for a minimum market value for the Best Buy Campus of not more than $118,500,000. 6. All points to be reduced to appropriate written agreements and orders.