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081814CompleteAgenda CITY OF RICHFIELD, MINNESOTA MONDAY, AUGUST 18, 2014 RICHFIELD MUNICIPAL CENTER 6700 PORTLAND AVENUE REGULAR HOUSING AND REDEVELOPMENT AUTHORITY MEETING COUNCIL CHAMBERS 7:00 P.M. AGENDA Call to order 1. Approval of the minutes of the (1) Regular HRA Meeting of June 16, 2014 and (2) Special HRA Meeting of July 1, 2014 2. HRA approval of the agenda 3. Consent Calendar contains several separate items which are acted upon by the HRA in one motion. Once the Consent Calendar has been approved, the individual items and recommended actions have also been approved. No further HRA action on these items is necessary. However, any HRA Commissioner may request that an item be removed from the Consent Calendar and placed on the regular agenda for HRA discussion and action. All items listed on the Consent Calendar are recommended for approval. A. Consideration of the approval of a contract with TMS Construction for the demolition of 7029 Nicollet Avenue S.R. No. 28 B. Consideration of the approv�l of a resolution authorizing the purchase of real property located at 7308-10 Avenue through the Richfield Rediscovered Program S.R. No. 29 ' Notes: 4. Public hearing regarding a resolution authorizing the sale of 7225 First Avenue to Endres Custom Homes and a contract for private development with Endres Custom Homes for the construction of a single family home under the Richfield Rediscovered Program Staff Report No. 30 Notes: 5. Consideration of a proposal made by the owner of 7228 Aldrich Avenue for a settlement of an HRA Deferred Loan Staff Report No. 31 Notes: 6. Consideration of the resolutions approving the 2015 Proposed HRA budget and tax levy and the 2014 Revised HRA budget Staff Report No. 32 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. HOUSING AND REDEVELOPMENT � � � AUTH�RITY MEETING MINUTES 1/ � Richfield, Minnesota Regular Meeting June 16, 2014 CALL TO ORDER The meeting was called to order by Acting Chair Supple at 7:00 p.m. ROLL CALL HRA Members Mary Supple, Acting HRA Chair; Doris Rubenstein; David Gepner; and Present: Debbie Goetfel. HRA Members Sue Sandahl, HRA Chair. Absent: Staff Present: John Stark, Acting Executive Director/Community Development Director; and Nancy Gibbs, City Clerk. Item #1 APPROVAL OF MINUTES OF THE (1) REGULAR HRA MEETING OF APRIL 21, 2014; (2) SPECIAL CONCURRENT HRA/CITY COUNCIL WORKSESSION OF APRIL 22, 2014; AND (3) SPECIAL HRA WORKSESSION OF MAY 19, 2014 M/Goettel, S/Gepner to approve the minutes. Motion carried 4-0. Item #2 HRA APPROVAL OF AGENDA M/Rubenstein, S/Gepner to approve the aaenda. Motion carried 4-0. Item #3 CONSENT CALENDAR A. Moved item for discussion. B. Consideration of the approval of a resolution authorizing the HRA to affirm the monetary limits on municipal tort liability established by Minnesota Statutes 466.04 S.R. No. 24 HRA RESOLUTION NO. 1183 HRA Meeting -2- June 16;2014 RESOLUTION AFFIRMING MUNICIPAL TORT LIABILITY LIMITS ESTABLISHED BY MINNESOTA STATUTES 466.04 This resolution appears as HRA Resolution No. 1183. M/Rubenstein, S/Goettel to approve the Consent Calendar. Motion carried 4-0. #3A—Consideration of the approval of a resolution authorizing the Richfield Housing and Redevelopment Authority to reduce the originat tax capaeity of the City Bella Redevelopment Tax Increment District due to Homestead Market Value Exclusion S.R. No. 23 Acting Executive Director Stark presented HRA Staff Report No. 23. He further explained the need to reduce the original tax capacity of the City Bella Redevelopment Tax Increment District due to Homestead Market Value in more detail. M/Gepner, S/Goettel that the followina resolution be approved: HRA RESOLUTION NO. 1182 RESOLUTION ELECTING TO REDUCE ORIGINAL TAX CAPACITY OF CITY BELLA REDEVELOPMENT TAX INCREMENT DISTRICT DUE TO HOMESTEAD MARKET VALUE EXCLUSION Motion carried 4-0. This resolution appears as HRA Resolution No. 1182. Item #4 CONSIDERATION OF A RESOLUTION APPROVING THE FIFTH AMENDMENT TO CONTRACT FOR PRIVATE REDEVELOPMENT BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY AND BEST BUY IN ORDER TO ADJUST ADMINISTRATIVE FEES COLLECTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY UNDER CONTRACT S.R. NO. 25 Acting Executive Director Stark presented HRA Staff Report No. 25. M/Gepner, S/Goettel that the followinq resolution be approved: HRA RESOLUTION NO. 1184 RESOLUTION APPROVING FIFTH AMENDMENT TO CONTRACT FOR PRIVATE REDEVELOPMENT Motion carried 4-0. This resolution appears as HRA Resolution No. 1184. Item #5 CONSIDERATION OF AN AGREEMENT WITH SIGNIA DEStGN, INC. TO DEVELOP A WAY-FINDING SIGNAGE SYSTEM FOR THE LAKES AT LYNDALE AREA IN AN AMOUNT NOT TO EXCEED $35,000.00 S.R. NO. 26 � Acting Executive Director Stark presented HRA Staff Report No. 26. Commissioner Gepner questioned the timeline of this project. Frank Hickey, Signia Design, Inc., stated that Signia will be working closely with City staff and working as aggressively as needed. HRA Meeting -3- June 16,2014 Acting Executive Director Stark responded that staff from the Community Development and Public Works Departments are working together to ensure that this project is completed in a timely manner. M/Goettel, S/Rubenstein to approve an aareement with Siqnia Design, Inc. to develop a way-findinq siqnaqe svstem for the Lakes at Lvndale area in an amount not to exceed $35,000.00. Motion carried 4-0. Item #6 HRA DISCUSSION ITEMS Commissioner Goettel stated that the City of Roseville has a senior housing program and challenged the City of Richfield to create a Kids At Home program for seniors. Item #7 EXECUTIVE DIRECTOR REPORT Acting Executive Director Stark reported that the Lakewinds Food Co-op will open on June 28. Item #8 CLAIMS AND PAYROLL M/Goettel, S/Gepner that the followinq claims and payrolls be approved: U.S. BANK 05/19/14 Section 8 Checks: 124825 - 124932 160,601.60 HRA Checks: 31979 - 31995 $ 16,045.96 TOTAL $ 176,647.56 U.S. BANK 06/16/14 Section 8 Checks: 124933 - 125032 $ 151,861.20 HRA Checks: 31996 - 32009 $ 19,381.14 TOTAL $ 171,242.34 Motion carried 4-0. ADJOURNMENT The meeting was adjourned by unanimous consent at 7:29 p.m. Date Approved: Auqust 18, 2014 � Mary Supple Acting HRA Chair Nancy Gibbs John Stark City Clerk Acting Executive Director HOUSING AND REDEVELOPMENT � , � AUTHORITY MEETING MINUTES y► � Richfield, Minnesota Special HRA Meeting July 1 , 2014 CALL TO ORDER The meeting was called to order by Chair Sandahl at 8:15 a.m. ROLL CALL HRA Members Sue Sandahl, HRA Chair; Doris Rubenstein; David Gepner; and Debbie Present: GoetteL HRA Members Mary Supple. Absent: Staff Present: Steven L. Devich, Executive Director; Kate Aitchison, Housing Specialist; Cheryl Krumholz, Executive Coordinator; and Theresa Schyma, Deputy City Clerk. Item #1 CONSIDERATION OF A REQUEST TO FORGIVE AN HRA DEFERRED LOAN AT 6641 CLINTON AVENUE S.R. NO. 27 Executive Director Devich presented HRA Staff Report No. 27. Chair Sandahl understands that the resident is very close to fulfilling the requirements of this loan but wants to know how this affects the money available in the fund if other residents would like to participate. Housing Specialist Aitchison stated that there currently isn't a waiting list for deferred loans and that the pool of money is sufficient. Commissioner Goettel questioned why financial information was not provided. Housing Specialist Aitchison stated that the closing company should've noticed this loan earlier and notified staff so that there was more time to prepare before the closing date was scheduled. Executive Director Devich stated that the HRA could take a short recess to attempt to receive financial information so that the HRA has the full picture before making a motion. Chair Sandahl noted that the HRA would be taking a recess for staff to gather financial information at 8:22 a.m. The meeting was reconvened by Chair Sandahl in the Council Chambers at 8:37 a.m. Special HRA Meeting -2- July 1,2014 Housing Specialist Aitchison provided the financial data to the HRA. The title company stated that the resident has health issues and the sale offer is $136,000. The primary mortgage is $28,661 and the HRA loan is $8,238. Therefore the current settlement statement to the resident would be $89,306. Commissioner Rubenstein stated that the resident is walking away with a lot of money and should have some responsibility to repay at least a portion of this loan. Commissioner Goettel agreed that a proportional settlement is reasonable. The HRA consensus was to agree to a $500 settlement. M/Rubenstein, S/Goettel to approve a request to forqive $7 738 of an HRA deferred loan at 6641 Clinton Avenue and requirinq a proportional settlement of$500 to be repaid to the HRA bv the propertV owner. Motion carried 4-0. ADJOURNMENT The meeting was adjourned by unanimous consent at 8:41 a.m. Date Approved: Auqust 18, 2014 Suzanne M. Sandahl HRA Chair Theresa Schyma Steven L. Devich Deputy City Clerk Executive Director AGENDA ITEM#: 3A REPORT#: 28 STAFF REPORT � � '' HOUSING AND REDEVELOPMENT AUTHORITY MEETING AUGUST 18, 2014 REPORT PREPARED BY: �TE AITCHISON/JULIE URBAN, HOUSING SPECIALISTS NANtE,TiTZ,E REPORT PRESENTER: JOHN STARK, COMMUNITY DEVELOPMENT DIlZECTOR A :,TITLE ACTING DEPARTMENT DIRECTOR REVIEW: � i;; IGNA U ,✓; ,r/ ' ,,, ,,,. ,-'-.> �� REVIEWED BY EXECUTNE DIRECTOR: ;% , i� ; -r` ITEM FOR HRA CONSIDERATION: Consideration of a contract with TMS Construction for demolition at 7029 Nicollet Avenue. I. RECOMMENDED ACTION: By Motion: Approve the attached contract with TMS Construction for demolition at 7029 Nicollet Avenue. II. EXECUTIVE SUMMARY In April, 2014 the Housing and Redevelopment Authority (HRA) acquired the property at 7029 Nicollet Avenue. The HRA plans to demolish the existing substandard structure and make the lot available for new home construction through the Richfield Rediscovered Program. The house is currently vacant and has been remediated. To reduce potential risks, holding costs, and negative impacts to the surrounding neighborhood, the house should be demolished as soon as possible III. BASIS OF RECOMMENDATION A. BACKGROUND � • The property was acquired by ±he HRA in the spring of 2014. It was qualified by a substandard ins�:�ection. 081814 Demolition Contract(7029 Nicollet).docx • The 62-foot property is currently being marketed for sale through the Richfield Rediscovered program. • In July 2014 the HRA disseminated a Request for Quotes to eight companies. Two responded with the following estimates: o TMS Construction $10,900. o PGM Construction Services $16,870.00 • Staff recommends the HRA approve the contract with TMS Construction. • TMS Construction received a positive recommendation from Richfield's Public Works Department based on work completed on the Richfield Parkway project. B. POLICY • The HRA has demonstrated success through its Richfield Rediscovered Program in removing obsolete housing in poor condition and developing new housing that meets the needs of today's households. • Historically, the HRA has demolished existing homes prior to selling the properties. C. CRITICAL TIMING ISSUES • The house is currently vacant. To reduce potential risks, holding costs, and negative impacts to the surrounding neighborhood, the house should be demolished as soon as possible. • The house will be made available to the Fire Department for training. Demolition should begin shortly after the training exercises are complete. • The property is currently for sale through the Richfield Rediscovered program. • If the contract is approved, demolition will be completed by October 31, 2014. D. FINANCIAL • TMS Construction submitted the lowest bid at $10,900.00. • There are funds available for the demolition in the Housing and Redevelopment Fund, E. LEGAL • Legal counsel drafted, and recently updated the Contract for Demolition. IV. ALTERNATIVE RECOMMENDATION�S • Do not approve the Contract for Demolition. • Award the contract to another bidder. V. ATTACHMENTS • Photo of 7029 Nicollet Avenue • Contract for Demolition VI. PRINCIPAL PARTIES EXPECTED AT MEETING • N/A 7029 Nicoilet Ave S 1 ��^` ' , � �.. _,,,y. � ,r, , `� _ :� r � .. . �� . �� .� ti ��- , -�-`` ;,�„� =:�.� ^ ,.,::�. �� f'� � �,,,� � ,� '.} f � � "_ �� 1��1` _ � . ;J' - � - ��.F` . � � -.✓i� ,E:� . �/ � �� i �'� . � � . .. 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" CONTRACT FOR DEMOLITION THIS CONTRAC'I' is made and entered into this day of , 20_, by and between T1VIS Construction (the "Contractor") and the Housing and Redevelapment Authority in and for the City of Rich�eld, State of 1VYinnesota (the "�IgtA") (collectively, the "Parties"), for the demolition of buildings located at 7029 Nicollet Avenue, Richfield, MN 55423 (the "Property"). RECI�'ALS � WHEREAS, the HRA requires the demolition of builditZgs�at t�e,Property (the"Work"). WHEREAS, the HRA has awarded the Work to�e Contractor; WHEREAS, the Contractor represents th�� .�t has the r�ecessary persont��l, e�perience, competence, and legal right to perform the Work, " ' NOW, THEREFORE, in consideration of the mut�tal obligations of the Parties hereto, each of them does hereby covenant and a �e,as follows: �` Section 1. Definitions �<:;, �t:;k ; S ' "City"means the City o�I��i�'i��,Minnesota. ; �?��:` �;. "Contract" or "Agreeri��i��'' mear��"this agreement�,between the HRA and Contractor for the performance of the Work� i�apg��.�� w�� all exi�i�iits, amendments, or modifications to the Contract. �.r � "Final Cc�impletion" means �1� items o�t�ie Work, "punch list items"and site work are completed and Contr��ox is eligible for:��nal Payment. "HRA" means the �Iousing�`and Redevelopment Authority in and for the City of Richfield, Minnesota. "Property"means 7029 Nicollet Avenue, Richfield, MN 55423. "Substantial Completion" means the time at which the HRA determines that the Work has progressed to a point where it is sufficiently complete, leaving only minor "punch lisY' and close out items and other minor site work required to be completed for full payment of the contract price. 1 "Work" means the entire completed demolition and all other activities to be performed by Contractor on the Property as provided for in this Contract. Section 2. General Requirements 2.1. Rights of the HRA. The HRA and the City reserve the right to reject any or all proposals or parts of proposals, to accept part or all of proposals on the basis of considerations other than lowest cost, and to create a project of lesser or greater expense and reimbursement than described in this Contract. The HR�.��o reserves the right to cancel the Contract without penalty, if circumstances arise.;�y�iich p�event the HRA from completing the project. In the event of any conflict betw��;t�e General Conditions and this Contract, this Contract shall control. 2.2. _I_nterest of Members of City or HRA. '�'��h��nf�actor agr��<� at no member of the governing body, officer, employee, or a �it of the City or the��_shall have any interest, financial or otherwise, direct or in��x, in the ontract. '' } �� ^��Z�;�. ��- , ' `.� 2.3. Equal O�portunity Statement. Contracto�"� �to ci�mply with tHe provisions of all applicable federal, state, and City statutes, or� �� (. es, and regulations pertaining to civil rights and nondiscrimmaf�= _„xncluding witha 3�}t 'mitation Minnesota Statutes, Section 181.59 as amended, incorp �Y. rein by refer��. �`� �� $ . ��:, � � � �. 2.4. Transfer of Interest. The Co actor��i� � ' ,ss,�g�i any interest in the Contract, and shall not transf �:�, interest in�t��: e erthe .< �assi nm �Znx , �a�� . g ent or novation, without the prior written ��'`, the HRA, ��ovided, hov�ever, that claims for money due or to income du��i the Cci ��ctor may b��_assigned to a bank, trust company, or other f nancial institt��i��or to wf rustee in Ba ;��tcy without such approval. Notice of any such assignment b� ;� ar�,` - t� 1 be fu shed to the HRA. Notwithstandin the t � g foregq��tractoi'�`��l be��fi =��{�:y��e subcontractors to perform the Work. ,, ,, ;�;,_ . . >.0 • y��, ��;>�. ��. Indepen��ri� Contr�t It is expressly understood that the Contractor is an `��.f�i�ependent cont�g�' anc��t'an employee of the City or the HRA. The Contractor sh��.ave control d�� the .manner in which the services are performed under this . �: Agreen��:t. The Co��actor shall supply, at its own expense, all materials, supplies, equipm�r�t �d tools r�quired to accomplish the work contemplated by this Agreement. The Contra�Ct��,sha�� i�ot be entitled to any benefits from the City or the HRA, including, without limrt�t��1; insurance benefits, sick and vacation leave, workers' compensation benefits, unem�il�yment compensation, disability, severance pay, or retirement benefits. 2.6. Accountin� Standards. The Contractor agrees to maintain the necessary source documentation and enforce sufficient internal controls as dictated by normally accepted accounting practices to properly account for expenses incurred under this contract. 2.7. Retention of Records. The Contractor shall retain all records pertinent to expenditures incurred under this Contract for a period of three years after the resolution 2 of all audit findings. Records for non-expendable property acquired with funds under this contract shall be retained for three years after final disposition of such property. 2.8. Government Data. The Contractor agrees to comply with the Minnesota Government Data Practices Act, Minnesota Statutes, Chapter 13, and all other applicable state and federal laws relating to data privacy or confidentiality, as those laws may be amended. The Contractor shall immediately report to the HRA any requests from third parties for information relating to this agreement. All data created, collected, received, stored, used, maintained, or disseminated by the Contractor in �$��orming its obligations is subject to the requirements of the Act, and the Contra��t�r mu�t comply with those requirements as if it were a government entity. The HI��es to promptly respond to inquiries from the Contractor concerning data request��`he �,�actor agrees to hold the City and the HRA, its officers, department hea a empl�� harmless from any clamis resulting from the Contractor s failu i`sclose da� aintained by the � .��r ''�. �:�, Contractor and authorized for release by # '��'HRA, and from Coi��tor's unlawful disclosure or use of data protected under s � d fede��laws. � �Y � . }, �> :_ � yJ�+�� };5�.` �A�`+r;}{T•. t� ��.� �� Section 3. Contract Price � x.. � �.�� 3.1. Upon compliance with a��; requirements�o � `�S�Contract, Contractor shall be paid the Contract Price of$10,900 �< �'_�� nt to Section � his Contract. �` „ �a�'u. ,�'�9,,.'� , >#`. �:�G 5 2i' Section 4. Project Schedule 4 �� `.w- �` �� . �. �,`' �h�--' <�> .. ��:} y .�y � 4.1. Contract��'�h�l�� "�mmence th��Work on�or after Contract execution and Substantial C�� letion e Work sha�X be achieved no later than seventy-five (75) days thereafter"�;},�e Worr:�s not substant �,y completed by October 31, 2014, damages of$100.00 will be��;�t�ct�� he Contr��t Price for each da the re uirements of this contra�t,�i��anot beerf �'�.�ille��`�x�`4 � y q H { , ,�;� ,�,� -_ y��:;, ��{�� t:.r.�:� ..,�.; `: Secho�,� Local l'��`��t Reqi��pen�ts and Related Submittals �� 5 �_'a :��". Contractor sh��:,obtain�permits required by the City, including a plumbing permit (foi w�,�� & sanrtary ��ver disconnects) and a demolition permit. Questions about these perr�rts, �Se�r,t�nit fees, �id tl�e scheduling process for the required inspections should be directed to��.�I�uild�rig Inspections Department at Richfield City Hall (612-861-9816). 5.2. No less fihan 2 days prior to beginning the Work, the Contractor shall provide: - Description of proposed dust and noise control measures for the Property. 5.3. Upon completion of the Work, Contractor shall provide: - Copies of any permits required by government agencies other than the City, such as transport or disposal permits. 3 - Copies of any test results required by government agencies other than the City, including but not limited to testing required as part of the asbestos abatement process. - Copies of all landfill records indicating receipt and acceptance of hazardous wastes by a landfill licensed to accept hazardous wastes. Section 6. Job Conditions - General 6.1. Contractor will disconnect and abandon utilities se�1ng t�ie Property, including water, sanitary sewer, electricity, gas and teleco ��cations; or arrange for disconnection and abandonment of same. Contracto�rY� all ��:�egin work before field- verifying that disconnection and abandonment has�ee��complet�� (�'��-�i '�: ��, 6.2. HRA shall ensure that the buildin��`�re vacated and use ��he property is discontinued prior to start of work. <_�� = x=' S�Y Y �� .?r p �..,. ��,. ��, s 6.3. HRA assumes no responsibility for �`'�� • �condition of st�uctures to be demolished. Conditions existin at time of ins" �' n for bidding purposes will be maintained by HRA to the ext : :� racticable. Co� •' tor may salvage any and all materials and equipment from the��' ��` . y Variations � : ' �structures may occur due to removal and salva e o erations `` � g p p I a �t of demo `�n work. • F�� : � ,. �; � ��, 6.4. Contractor s�� rovide all 5 b� , mate� e ui ment employee training � �ry q p � , compliance with,�� \`�� '$ons, permits��notificatio��, licenses and agreement necessary to perform th�_�rk descr�� ' in this Con ct. �� . _.� ,; 4 � ,.�,,' 6.5 The Contra��.' op��a ,��hall not�any time encroach on adjacent residential prope�,t�e�� W,ere re��s oc�F �� "�acent properties, the Contractor shall stake � an��'�r�`k�� aries3��property to identify the limits of operations for its f��iployees and�� ntract � „� ,� , n � ,:� y"��>`: ��'��, �� 6 �� ' Where ad�ac��buildings are occupied, the HRA requires Contractors to advise the inl�t .�:tants as to � �n they will start work activities and of what hazards are � ,. involvec�;;��h Contr��tor shall also furnish the occupants of the adjoining properties a phone num�5��yher�'�1iey can reach the Contractor in case of an emergency or problem. .�.. 6.7 As dire��d by the City Inspector, a silt fence or other appropriate erosion control measures shall be erected around the perimeter of the Property to prevent erosion and unwanted run-off onto adjacent properties, streets, and alleys. Silt fences must cotiform to standards set by the Minnesota Pollution Control Agency and the City. 6.8. All materials fi�om undertaking the Work shall become the property and responsibility of the Contractor. 4 6.9. Contractor may choose to salvage materials and equipment. Any saivaged items must be removed fi•om the Property in a timely manner as they are salvaged. On site storage or sale of salvaged iteins is prohibited. 6.10. The use of explosives and on site burning by the Contractor are prohibited. 6.11. Contractor shall provide water, electricity, communications and toilet facilities on site as necessary to complete the work. 6.12. Contractor shall provide and maintain uninterru�� ve�ficular access to the Property, including temporary demolition facilities, stor��+��`�d work areas, for not only persons and equipment involved in the project but a1sQ��'tieig��,��vehicles. ��; S � �.. 6.13. Contractor shall keep fire hydrants and ��coritrol valve'� from obstruction and accessible for use. ;�� I �`,�, �� ,.� �°=�, 6.14. Contractor shall take all necessary� � uards��,�revent dama�5or injury to neighboring property. �`, <`-{{x�� ;�.r r::: .�� 6.15. Prior to closing or rerouti� _: isting traffic lari�=`� sidewalks in any public street easement or right-of-way adjac T ..,�� treets, the � � �" �tor shall obtain written permission from the City Engineer �; x�� t: lated to la �closures, including but not limited to traffic barriers, signs and si :ilar e.� s��1 as traffic control personnel, shall be the respons�,�� of the Contr � �' � ,.. ��,z� �� ,� �" � ,'Sk„Q-Si\ 4� : S" F .�(� 6.16. The Cp�i actor m�,��onduct wor�, n the Property from 7 a.m. to 7 p.m. Monday �s` �{, through Friday' 9 a m��o 5 p.m. on ��:irdays. No work shall be conducted on Sundays or legal h�o ys,�`�k � �.._1 `i g�,��<�� ,tlt}s,�.s �; ;::. f >;` �Z,� � z��.� 6 �:7. �"�h��ctor sh�1�`�ot crush ariy materials on-site. �? � . � � � � �, Contractor� `�1 main��ii`'the Property in a safe and neat manner. Adjacent pr��_�es, streets an��ght-of«i�vays shall be ke t free of dirt and debris. ,.��_� , P �. 6.19 ��=;�;Q�tractor ��negligent in carrying out any of the conditions in this Section 6, the HRA re��s tl��right to perform this work with its own workforce at overtime rates. The costs of stt��ork will be charged to the Contractor. Section 7. [Left Blank) Section 8. [Left Blank] Section 9. Demolition 5 9.1. Contractor shall use water sprinkling, temporary enclosures and other suitable methods to limit dust and dirt rising and scattering in air. Contractor shall comply with any and all governing regulations pertaining to environmental protection. Contractor shall not use water when it may create hazardous or objectionable conditions such as flooding or pollution. 9.2. Contractar shall clean adjacent structures and improvements of dust, dirt and debris caused by demolition operations and return adjacent areas to condition existing prior to start of work. t ,��; ;.�, 9.3. Contractor shall demolish buildings, other ��i;��ires, improvements, and landscaping completely and remove all debris from ��L Pr�p��t . Contractor may use such methods as required to complete the work b��t to the��tations of governing regulations. ��s "= ` �' � � , <� �� t��K 9.4. Contractor shall proceed with de ,'on in a,s ystematic mari��`�t5m top of structures to ground, and will complete dem � wo� �bove each floo�r�r tier before disturbing supports on lower levels. ��\ � �' �. � 9.5 After the Building has b' ,::� :�moved from th ti�V��.�• erty, Contractor shall remove all foundation walls and the bas �� or slab, and�' � ��move all other at grade masonry, concrete slabs, sidewalk 4 s • driveway ;%�om the Property. ALL ASPHALT, MASONRY, AND ��10N�, . - Y:,�'�'MATERIAL MUST BE TRANSPORTED�,�.�X FROM TH�� . �`� x ��Y��;:E��.}�� 2�� :_?}U' ,,< ,�y �.. . � ': 9.6 Immec�� :�ly upori -: removal of� Building from its foundation, Contractor shall furntsh ari 4 ct on t �Pro ert a wd� lat snow fence or an approved substitute .. ��^, �, p Y �� either one bemg m�� r�� reasona �acceptable to HRA. The fence shall be at least ��;��,��n heig�� all c��.� � close the open basement, and shall remain in pl ��n�il f��menf��'',_��led, at wh�h time it shall be removed• .��+�''� ' �?LyK.. \ti�-.�`�5'8'-. , �� \.k � s �' �y. •�� -:= , ��;� Contractor� �� locat��i�olition equipment throughout the building and remove �t� v m� �ls so as to no��t .pose�cessive loads to supporting walls, floor or framing. �4m�' 3s3 �� . 9.8. ��f��tractor sh�`provide and maintain interior and exterior shoring, bracing or other structi��,sup��3rt to preserve structural stability and prevent movement, settlement or collapse of fi:�1i�;1�'iiilding. 9.9. Contractor shall break up any concrete slabs-on-grade and remove from the Property. 9.10. Contractor shall demolish footings, foundation walls, tunnels and other below- grade structures and remove from the Property. 9.11. After removing all foundation walls and the basement floor slab, as provided above, Contractor shall fill the basement to ground surface level with clean compactable 6 soil. The basement hole MUST BE inspected by the City Inspector prior to filling, and any unauthorized debris removed. The fill must not contain any hazardous substance or disposed building material. 9.12. All sheds and other accessory structures, clothesline and other poles, and landscape structures shall be removed from the Property. 9.13. Contractor may not cut or remove a tree from the Property without prior permission from HRA. If any trees are cut or destroyed by Contractor witl�pj��rior approval, Contract will pay to HRA damages of$200 per tree. Any such da �ges sliall be deducted from Contractor's payment. Any trees approved by the HRA fp,� � �val and cut or felled in the moving process shall be removed immediately,and the ��e`s�t� �ma remain. t,�� ;,,.:: y �� 9.14 Contractor shall provide certificate of w��j��d(�nment if i��red. rt� 't`>�'�k� �� \� Section 10. Debris Control � ,� � ��.��-;, , ��;,w, �'��h '��` � `' ,< �;.. 10.1. Contractor shall maintain the Property fr � ... t rane�us debris. �� g;, 10.2. Contractor shall prohibit�� oading of truck��, revent spillage on access and haul routes. ��:��" " _ �� s.�.: ;��_ , Y��,,, �;. � 10.3. Contractor shall maintain a svV'.�pm }:' ` -u j�rogram to prevent deposition, release and c� � �sal of soils an�c�_ is onto = : d surfaces. �>:�� ,;,� Section 11. Dispo�� u�� r..�� ..;`{� , y 5 `�#� . A� - �� 4��tit��' 11.1 Contractor �'� n��'� �� the Prc��erty all debris, rubbish and other materials ,��I��it��from� �oliti��`o��'��s. , '>`ss �'�� s�;. � z�-• S �� : � ,w,�,, �y .�� 2. Contrac�� F �11 tran��t rr�aterials from the Property and legally dispose of them {.::a off-site in a��dance�;��f governing regulations. ;��. ��.,.. .;:� .:. �, > �w :, Section 12 � � rthwork ��; :�� , ;Y j:- 12.1. Co� � ,tor s.��ll rough grade the Property using clean fill after completing all abate�fi :�nd demolition activities; taper edges of all excavated areas to minimi�� slope of 2 to 1, keeping soil disturbance to a minimum. Property must be seeded, and erosion control measures must reinain in place until turf is established. The Contractor must comply with all requirements of the Minnehaha Greek Watershed District related to the Work. Final payment will not be made until turf is established. 7 Section 13. Excusable Delays 13.1. The following circumstances, and onlv these circumstances, will, at the HRA's discretion, be consider•ed legitimate cause for a change in the commencement and/or completion dates specified in Section 4 of this Agreement: a. Material delay -- material delays that are beyond the control of the Contractor, which can be shown to have directly caused the overall late completion. ,. � ° b. Adverse weather and emergency condi '� ` weather or emergency :'_� -- conditions that directly affect the sc. ulii�::`:,� exterior work over a �� significant portion of the term of thi�„A� :eement <. ��,.�� , ��-. \�' > �. � � c. Strikes -- Contractors who f�union work stoppag��,��he case where they have to rely on such a�� `.force in'� rder to comple��;Work. � ,. � �, �. . '�� ,. d. Amendments -- amendments in f .,�:.:��nal scope of worl�; which can be reasonably shown to require an ' ` sion of the time allowed for completion. ��} �� u �, ,tir� yx,, 42 '�k �•: -,. "�t� .�: e. Other delays — act or�}eg - e HRA, o ��an employee of either, or of a separate contracto�empl�; � e,.��, or by changes ordered in the �� . or by unav� e cas .� ' or other causes beyond the C�� ontrol ��_' �Y � , } �r� � � - � � ��„ � �� . Section 14. Cha�ige��r � �.,m� >,� �� . ��;> �,�;k �' �`.. ?� ...�.y LF.�\�, 5< 14.1 �� ha ��: ��rlg�,'�;j��,��<general scope of the Work and without notice to�t`�sure��eties�`t�ie Contractor, if any, to make changes in the Work, either by ��ering the natui��the sa��;�r by adding to or deducting from it. �� s�g�s��i �4�r:;• 1��This is a lum�:�um cor��ract. The Contractor must immediatel con � y tact the HRA prior ��';��Cceeding th��ontract Price set out in Section 3.1. In the event an unknown �_ �< condrtio�,�s„ encoun��ed during the Contractor's performance of the Work, the Contractor i��no��%�the HRA's project manager immediately. The appropriate course of action will `�=__��termined and, if necessary, a change order will be authorized prior to the start of the,work. Change orders for additional payment will not be granted due to the Contractor underestimating quantities of material(s), winter weather conditions or the amount of labor required in order to perform the Work. For change orders related to Hazardous or Regulated Materials, the HRA reserves the right to subcontract the work to another contractor. 14.3. All changes shall, except in the case of emergencies endangering the safety of persons or property, be made by written change order. The parties shall determine the effect of any change order on the Contract Price and project schedule by mutual 8 agreement. The Contractor must promptly comply with any and all written change orders. No such change order shall be deemed to invalidate the remaining terms and conditions contained in this Contract. Section 15. Waiver of Liability 15.1 It is agreed that the Work is undertaken at the sole risk of the Contractor. The Contractor does expressly forever release the HRA and the City from any claims, demands, injuries, damage actions, or causes of action wh��ver, arising out of or connected with the Work. ��> �, �>� � { Section 16. Indemnification f�� 'y� � �`" 4` -�5 .. 16.1. Any and all claims that arise or may aris .;��k�o sequence��y act or omission on the part of the Contractor, its agents, se - nts, or employees vv'`� •.engaged in the performance of the Work shall in no way:,♦ ' �.e oblig� 'on or responsi :'� . �the HRA or the City. To the fullest extent permitte � law, � Contractor agA s to defend, indemnify and hold harmless the City and th ` , and their empl�yees, officials, volunteers and agents from and a ainst all claims, > s, damages, losses and expenses, including attorney fees, arising �= f the Contract egligence or the Contractor's performance or failure to perform tions under t ement. The Contractor's indemnification obligation shall ap; y'` - ` . ontractor' bcontractor(s), or anyone directly or indirectly employed or hi by cto ;or anyone for whose acts the Contractor may be, � The Contra o 'grees t y demnity obligation shall survive the completion o�� p of this Ag. ement. �? ;}� �•�4 � Section 17. Insafrai��nh � ��`.� ��:. ;a�;, �.�� Ytg;',�3`t2�f�S -i� 17.1 ��ntracfd��ees��tti:�� " '�`�to protect itself, the HRA, and the City under th �-i��em �. ��' � �� ision � ��forth in ection 16 of this Agreement, it will at all times ��mg the term i��is A�� e�t, maintain, at a minimum, the following insurance �xy� �� ies: � ;`} �` , `£�,��. �;�:,`. �r�. ;,. �>.; Woike�om�ensation Insurance. The Contractor shall maintain worker's :< compe,.��tion insurance in compliance with all applicable statutes inclu� g Chapter 176 of the Minnesota Statutes. Such policy shall ��t�de Employer's Liability Coverage and at least such amount(s) as are �`ustomarily provided in worker's compensation policies issued in Minnesota. Contractor further agrees to require all subcontractors and independent contractors to maintain worker's cornpensation insurance in compliance with all applicable statutes and to monitor the compliance of such subcontractors and independent contractors with the applicable statutes. b. Commercial General Liabilitv Insurance. The Contractor shall maintain Occurrence Based Commercial General Liability Insurance ("CGI,"), 9 AGENDA ITEM#: 3B REPORT#: 29 STAFF REPORT ,�t� � ' ' HOUSING AND REDEVELOPMENT AUTHORITY MEETING AUGUST 18, 2014 REPORT PREPARED BY: JULIE URBAN/KATE AITCHISON, HOUSING SPECIALIST NAME,TITLE REPORT PRESENTER: JOHN STARK, COMIVIUNITY DEVELOPMENT DIRECTOR ,TITLG ACTING DEPARTMENT DIRECTOR � REVIEW: � sic vnE � _ ,� REVIEWED BY EXECUTIVE DIRECTOR: � � ITEM FOR HRA CONSIDERATION: Consideration of a resolution authorizing the purchase of real property located at 7308 10th Avenue through the Richfield Rediscovered Pro ram. I. RECOMMENDED ACTION: By Motion: Approve the resolution authorizing the purchase of real property located at 7308 10th Avenue through the Richfield Rediscovered Pro ram. II. EXECUTIVE SUMMARY The owner of 7308 10th Avenue has expressed an interest in selling the property to the Housing and Redevelopment Authority (HRA). The 814 square-foot house and detached 1-car garage was recently appraised at $93,000. The house was evaluated and determined to meet the substandard criteria. The HRA would acquire the property for the appraised value of$93,000. Subsequently, the house and garage will be demolished and the vacant lot marketed for sale through the Richfield Rediscovered Program. III. BASIS OF RECOMMENDATION 081814 Acquisition of 7308 10`h Avenue.docx A. BACKGROUND • The one story, slab-on-grade, house was built in 1952, has two small bedrooms and one bath for a total of 814 square feet, and a single-car detached garage. • An independent evaluation was conducted and concluded that the house is structurally and functionally substandard, containing many code and structural deficiencies that would be difficult to correct. B. PoLICY • The 2008-2018 Richfield Comprehensive Plan states as policy: o Encourage the creation of"move-up" housing through new construction and home remodeling. o Promote the development of a balanced housing stock that is available to a range of income levels. • Through the City's Richfield Rediscovered Program, the HRA purchases and removes substandard and functionally obsolete housing and replaces it with newer, higher valued homes. G CRITICAL TIMING ISSUES • The Purchase Agreement has been approved by the sellers and is being routed for signatures. • If the HRA approves the purchase, closing will occur as soon as possible. D. FnvarrclaL • The property recently appraised at $93,000. • Funding for this acquisition and demolition through the Richfiefd Rediscovered Program is in the HRA's 2014 Budget. • The property owner will seal all wells on the property. E. LEGAL • Legal Council has prepared the Purchase Agreement. IV. ALTERNATNE RECOMMENDATION(S� • Do not authorize the purchase of the property. V. ATTACHMENTS • Resolution • Photo of existing structure • Purchase Agreement VI. PRINCII'AL PARTIES EXPECTED AT MEETING • None HRA RESOLUTION NO. RESOLUTION AUTHORIZING PURCHASE OF REAL PROPERTY LOCATED AT 7308 10TH AVENUE WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota ("the HRA") desires to purchase certain real property pursuant to and in furtherance of the Richfield Rediscovered Program, said property being described as: 7308 10th Avenue Legal: Lot 2, Block 9, "Fallden's Third Addition," Hennepin County, Minnesota WHEREAS, the HRA is authorized by Minnesota Statutes Section 469.012 to acquire real property within its area of operation; and WHEREAS, Housing and Redevelopment Fund money is available for acquisition purposes. NOW THEREFORE, BE IT RESOLVED, by the Housing and Redevelopment Authority in and for the City of Richfield: 1. The purchase price for the property identified is approved at $93,000, plus closing costs, not to exceed $98,000. 2. The Chairperson and Executive Director are authorized to execute a Purchase Agreement and to take other actions necessary to purchase the property for the amount set forth in this resolution. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota on this 18th day of August, 2014. Suzanne M. Sandahl, Chair ATTEST: Doris Rubenstein, Secretary 7308 10t" Avenue South �� ?.w �,��. � „ � �'� � � '� �, �t � � ,t� �� t � ; �•j�@'tt' -�� !� }�. � !: ' , �� ./� i.. ., 1+� ,: ,/.r� ,-Ye. � ,�r �, . „ � �. jt�/ 1, � � i y- 9�� k "r � '�l�A t�, }� �� ft 1 y ��.,':' �� y. '/.� ��` t` 3� ^':. ,,t.�; � �` '��.. f��','�i�,#'` �,�:� 4x+�! '\ I"��. r �.'L �'-�,�.�.,�h, 4 t Y � �;1�1'fr�.�� :1is � 'Y�' '�� ) �'! �'�� ,.�� ';<�r�,�� f. �' �` � '• � �f i � '��_ �•7� ,r,.,, , '" � � �� ' j '��, 1.:' ► r' /' �, ?�' � .� �'� �t-, _� ;� ��,� ��i,�y,{�� ! Y ' v,' �,'r�,�{s�v .. �'� �.��.�}R��'�.. �i � �� r�• ; r ,$: .��,�r� 1 '4,t S��•� .A�� i . 4.t^� 'r ��4��+ �(�'4` ��•� �� T��f.J r+5� } , ,i� �J-:`Y 4 �bt �). ! }'' 3� � .c � • ;�j7� . !`t� `"� �^' ��...��7�,�? � i -y .,,,�- g jrF� .+ ✓� y ��iy. r �y� ��Y�1t t �'�.. ....-7` :� e4�-N �}� �tytt ��'Z� 'k��5 � i'�"'NS.'��.{��, ��i��.� �• �1 5 � ��- Cv�� t v� _ '�tS .`R �- �.�h' y�yl �'a. r� I� �� '^'� ,+ .,� i;,;�'^ .,� `,: ,!, 1 ;' � — , ��i ��: . .� � �� -°. :++'A � t r..�_ e„ _ � ..F .. _� '� rt.viyflf°i °`a ' � �� I � � �' " $ � �� . ,}�� " ,�,� � D,��` � �� „ �----,�. .�n , . _ � .'� �c == � � r. — -_=,-� ' _ � � 4 - - � � ''I - , ��i�€y��1� `� 1 ^ i� ,�� w ___4�--� .��.+---- � ��'� � �; ,�#�� +�+�F ,,"" . "' a'"'S�,,M+'''�i`' ..,„� + ...ioJ� � •s�;- +`qmMf{ry��ti�.��. �t, t� � �M1 . `, . ' . ; , �-.' 2 �: _ .1 �F' A9�{;!a�r � �1{��!` k�'.t ��` :"'t. 'd6�''r J l� ii. -t�- c�.. i:. .. *�r,� "'�� Af' .� � � °.� �� f J%:r• f,l i� �� wa , t ��,,� • n . "r,��:.' -.�� {,�'��1 i �- � ��` �1.��' �� '+?��j� � Y £:F'�'�y . �' 1^ i..: i'int�. ��L :,h', . . �t � tla`nfl� . • � : ?". . . �`� . r .I f,�..A��ir2{�&.a.j�J.• �•1. ..'ia..'Y . . �.Y"y � �..x .p., } . . . Pt y,tn r �'� '� t �� iN4 . . �^rI .`'(+�rYl•H 3 'Y.t P �. <f(�y �'� , � . � . W . . A �/ � .�'� ,- �y,� � � r y . ... :��/�'�.1 . VaL�s_.s=.s..-YS�'eM4Ah�*�. { � s,.., f;;c'"� k .��.s�. � � -{�kr'�, ` 4 +.a1i� ?.�.,. :.�k�a-.. - . . ' . •- .. .�.. . .. . k .!._{h -s�j..''tI`'� . 1 r � __.._. ... _. -- , --" �.� . -, ?. - d :; ''_ .�t�L'� '" .t�yaf�: �e.. PURCHASE AGREEMENT THIS PURCHASE AGREEMENT (the "Agreement") is made as of this day of ,20_,by and between James L. Monahan, spouse of Kristi K. Monahan, by Mark Herll, his attorney in fact; Kristi K. Monahan, spouse of James L. Monahan, by Mark Herll, her attorney in fact; Kevin C. Monahan, spouse of JoAnn Monahan, by Mark Herll,his attorney in fact; JoAnn Monahan, spouse of Kevin C. Monahan, by Mark Herll, her attorney in fact; Patricia M. Herll, spouse of Mark Herll, by Mark Herll, her attorney in fact; and Mark Herll, spouse of Patricia M. Herll, (together"Seller") and the Housin�;��,,.�edevelopment Authority in and for the City of Richfield , a public body corporate,��poli��c under the laws of the State of Minnesota ("Buyer"). ��hT�,. `��>'��;s .�� ,�. ��t ��''�i RECITALS {} +.. t >yk.��'`4. �f �, ;�� ,'k�ry�`�f %` -.`V�`�� 4�,:.� ;. � Seller is the owner of property located at 730��;�tn Avenue South, Ri`�V��ld, Minnesota, which is legally described on the attached Exhibi�y ,��` �.�Propert�� {�; ��` �''��";��s�'' . �,�} ��p��e�'`'°;? The Property includes includes all plants, shrub�� '� � es, s�orm windows and/or mserts, storm doors, screens, awnings, window shades, blinds, c �� 'n-traverse-drapery rods, attached lighting fixtures with bulbs, plumbing � s, water heater,�'��; 'ng system, humidifier, central air conditioning, electronic air filter, auto ;�' �} ge door ope �`:�� 1 controls, water softener, cable television outlets and cabling, and b t m�� : .�iing dish �ier, garbage disposal, trash � $�.��: �,. compactor, oven(s), cook top stove, microw�.t� ove.� _ ,.,�f�ercom an d ins ta l le d carpe ting �� ,, .��:�;. located on the premises w��h,� are the pro ', �-of Se .� -The property also includes the following personal pro�� { Seller is� sponsible �r removal of all personal property. Seller ma remove t: :;, �llowmg � s, providec��eller does not cause any unnecessary damage y �� ;k�� to the Property: � ��,� ��; �; �.°�` �j .. ��z. `� �.�t- �t:� �:. �Yj �� .�f?�t � ;�5�5�}4;:: �}`.,4 ��G}�t i�i '�5 11 � #9•'C x. �} Jl.i.,. t'S*l��ks''v;� �,��,,,,�{}y=. _ .,t..""', ,�y� ��„ / 5 C y t w, r , � J :� ��GREEMENT {F: } ^ �� `.;K �x� .��` ,,?>`: �v � ��: 1. :;��'fer/Accept��t�e for Sale of Property. The Seller agrees to sell to Buyer the .. �,,. Property and Bi��,�grees to��rchase the same,according to the terms of this Agreement. �>;;:�>, .�:> 2. Purch��'rice for Property and Terms. A. PURCHASE PRICE: The total purchase price for the Property is Ninety-three thousand and 00/100ths Dollars ($93,000.00) (the "Purchase Price"). B. TERMS: (1): EARNEST MONEY. The sum of Zero Dollars ($0.00) (the "Earnest Money") shall be paid by Buyer to Seller. 1 315418v3 CBR RC125-41 (2): BALANCE DUE SELLER. Buyer agrees to pay by check or electronic transfer of funds on the date of closing on the Property (the "Closing Date") any remaining balance of the Purchase Price due to Seller according to the terms of this Agreement. (3): DEED/MARKETABLE TITLE. Subject to performance by Buyer, Seller agrees to execute and deliver a Warranty Deed or Personal Representative's Deed conveying marketable title to the Property to Bu er, sub'ect onl to the followin exce tion �-��-�. Y J Y g p ��, ��`. � �� a. Building and zoning laws, ' .��ces, state and federal regulations. �" JY.. �:J �`�R•"`'��`"h ='+5�'�`:", -'�Ss �i% £v�'., .,. b. Reservation of mineral�>��;;��rii�neral ri : �� to the State of .�� :�;�.. ti�Y��', Minnesota, if any. ,�� :,�.� ��{w� fi�" �; .3�:,,;� �: � .,t� SA y 4=.:�,�v��'. c. Public utility and'`dra � ease �'_�ts of record ��ich will not interfere with Bu er's int y� -• �e o��he Pro ert : Y p Y d (4): DOCUMENTS T �'' DELIVERED``��t'.��.CLOSING BY SELLER. In addition to the Wa : ;�.r. ed required � �� raph 2B(3) above, Seller shall deliver to Buye- ��,,. "��{' y 'h`:5 '�� b �4;�, ;�> � }�,`,�• a. t ndard form A i ,�-�rt of� ��r�:k` ��.�. `��` ��- �Y.:<. �� . � Sj. . �� A `¢ �� g-down" ce ficate, certifying that all of the warranties made �' "°�.f� by S�r in this Agre } ��tt remain true as of the Closing Date. ,:�.tt,�.s,� �.j�� f`� ��i� ,�;�x< c � Y ific�a��i�� r is not a foreign national. �_�`�� , ��.• ,.+ �`;�. �'.1,M S 3�. ..,�,� t� ib i; � '��, c�= � If an�. ' or�nental investigation by or on behalf of Buyer discloses '; k ��the exi �''`�e of petroleum product or other pollutant, contaminant r � {�r � �'�;� ��> �� oth� hazardous substance on the Property, either (i) a �� :s. �y��osure letter from the Minnesota Pollution Control Agency } } <;{�VIPCA) or other appropriate regulatory authority that remediation ��:vs��;F. ;;;::hr�as been completed to the satisfaction of the MPCA or other 4 ` authority; or (ii) Agreement for remediation/indemnification and security as Buyer may require. e. Well disclosure certification, if required, or, if there is no well on the Property, the Warranty Deed given pursuant to paragraph 2B(3) above must include the following statement: "The Seller certifies that Seller does not know of any wells on the described real property." If Seller is unaware of the location of a well and there is a building 2 315418v3 CBR RC125-41 permit issued for the Property prior to installation of a City water system, Seller agrees to have a licensed well contractor examine the Property for purposes of locating a well. Seller agrees to have all wells located on the Property, which are not in use, sealed by a licensed well contractor at Seller's expense. Seller agrees to escrow funds on the Closing Date for the purpose of locating and sealing wells if circums��:.,prohibit locating and sealing wells prior to closing. �y� :��;�,, :��ry� : f. Any other documents reasonably �� ire � ,Buyer's title insurance company or attorney to evi en that :�' � to the Property is marketable and that Selleru��`��o�nplied �;�he terms of this .,��`$- Agreement. -�`` ��$F=.. , `��w�q��F � � .�• 4. ��, ��V�.. '$,}i:�N �`'t,. 3. Contingencies. Buyer's obligation to ,��.�s con�`'�nt upon the fo�� ing: ,�� :. `r� a. Buyer's determination of marketable � �, �ursuant to paragraph 4 of this Agreement; �'i" ��« ��?'�`4F � � ��. ,��. . �, �, � b. Buyer's determination, :'n >�k;� �.,a discretio��that the results of any environmental investigat�i of�`� •� erty=�`�conducted pursuant to this �:.�.,- '��fi..,. ',, Y�s Agreem e satisfactory ��•��yer; ��;� �� ; �� .�. c. T ��rties ac '� ledge that � Richfield zoning ordinance requires that lots i�t�t'"�� -:�distric��` eet certain '• um lot width, and area requirements. If these s rd �`'" .` met, one r more variances will be necessary prior to �` �•�� .�tstructi a ne � = on the property. If the City of Richfield does 9�s:3z �.. ; �' `�� e all s: nces.necessary to make the property a buildable lot within 2`` the��'ti��'�`'�g o� � « on��g ordinance, Buyer at its sole discretion may cancel � � :� • , �,t � � this Ag ent; ar� _��.> 2��. �� F , ��` � °�s}�;��,,,Approval t��his Agreement by Buyer's Board. >.#�;.�>J:� j�� ::�;��;.: �� 3}? Buyer shall hav��€�til �k�� Closing Date to remove the foregoing contingencies. The contingencies at a., b:;��c. are solely for the benefit of Buyer and may be waived by Buyer. The >�.r: contingency at d. may�l�t be waived by either party. If Buyer or its attorney gives written notice to Seller that the contingencies at a., b., c., and d. are duly satisfied or waived, Buyer and Seller shall proceed to close the transaction as contemplated herein. If one or more of Buyer's or Seller's contingencies is not satisfied, or is not satisfied on time, and is not waived, this Agreement shall thereupon be void at the written option of Buyer and Seller shall return the Earnest Money, if any, to Buyer, and Buyer and Seller shall execute and deliver to each other a termination of this Agreement. As a contingent Agreement, the termination of this Agreement is not required pursuant to Minnesota Statutes, Section 559.21, et. seq. 3 315418v3 CBR RC125-41 4. Title Examination/Curing Title Defects. As soon as reasonably possible after execution of this Agreement by both parties, (a) Seller shall surrender any abstract of title and a copy of any owner's title insurance policy for the property, if in Seller's possession or control, to Buyer or to Buyer's designated title service provider; and (b) Buyer shall obtain the title evidence determined necess��.�r desirable by Buyer. ��'� � The Buyer shall have 20 days from the date it receive <':` ' ,title evidence to raise any objections to title it may have. Objections not made within�;�; ch � �:��vill be deemed waived. The Seller shall have 90 days from the date of such object' n < affect��45"�;provided, however, that Seller shall have no obligation to cure any objecti��t�d�"�nay info �� y ,uyer of such. The Buyer may then elect to close notwithstanding the u• ed objections or de �{ ;: his Agreement �, null and void, and the parties will thereby be rele om an�.urther obligatio .�nder. ,. , fk, , + .� �l` �}� 5. Environmental Investigation. The S`�'�� rran�s that the P�operty has not been used for production, storage, de osit or disposal�� ,,�' y toxic or hazardous waste or substance, petroleum product or asbesto � uct during the �• �'=d of time Seller has owned the Property. The Seller further warrants th x as no know ,.�.x information of any fact k�•. which would indicate the Property was us fo � • �fr'`� tion, stora : ;deposit or disposal of any �=, toxic or hazardous waste or substance, petr �� um �� as.� �stos product prior to the date � ��`�$ ��r's warranty regarding petroleum Seller purchased the Prope otwithstandi t �above, �. products does not precl � \ nce of heat� oil or oth�r similar products used as a heating fuel for the dwelling� eller d "�warrant that' `there was a fuel tank on the Property used for � ` the storage of heati�g � r othe imilar produc`��,�'ller has no knowledge of any leak in the tank or contamination cau e; ` � �� .Q.�z%°` �� . x:. �.�•, .� • ' :�;a �� Seller he�gra • � � er a �� uyer's agents a license to enter and evaluate the Property for _,, the pu. :�se of conduc� en : en;tal assessment. The Buyer is required to perform an t� ."4. �z, env�t�d"' ``�tal assessmen "'or to c: mitting federal Community Development Block Grant (CDBG) `��s,. Further, B -�� or B k yer's agent shall have the right pursuant to the license to ,�.. . bring persori��:��,,..equipment,. 'to the Property, make inspections and perform tests and analyses as Buyer may`� '�' � reason ��e to determine the presence of any toxic or hazardous waste, ��'k � substance, or peff�,��m��duct or asbestos product, and ascertain soil conditions on the Property. Buyer sh��l�;�ar the cost of the environmental assessment. If the results of the environmental assess�ient are not to the satisfaction of Buyer, including a release from environmental conditions related to the commitment and expenditure of CDBG funds, Buyer at its sole discretion may cancel this Agreement. If Buyer cancels this Agreement pursuant to this provision, Buyer shall restore the Property to its original condition or nearly so as is reasonably practicable. 6. Real Estate Taxes and Special Assessments. Real estate taxes payable in the year of closing will be pro-rated between Buyer and Seller to the Closing Date. Seller shall pay all real estate taxes payable in previous years, the entire unpaid balance of special assessments, and 4 315418v3 CBR RC125-41 all installments of special assessments levied and pending, including special assessments installments payable after the year of closing. Seller also agrees to pay all assessments related to service charges furnished to the Property prior to the Closing Date (e.g., delinquent water or sewer bills, removed or diseased trees), including those charges levied, pending, or certified to taxes payable in the year of closing. If closing occurs prior to the date the amount of real estate taxes due in the year of closing are available from Hennepin County, the current year's taxes will be pro-rated based on the amount due in the prior year. 7. Closing Date. The Ciosing Date will be on or before �' ober 1, 2014. Delivery ��, of all papers and the closing shall be made at the offices of Buyer, �b Po�tland Avenue South, Richfield, Minnesota 55423, or at such other location as ' ` ` ally agreed upon by the �;�:4: parties. All deliveries and notices to Buyer shall be made to t ��abo . �• ress and marked to the attention of Housing Specialist. , �� `�.��- ��'`$}fiL. 5,. $y�t ,t'�'i�s y�F �}j� ��?k }Y ' •}qy+.,s'•;'�� 8. Possession/IJtilities/Removal of Pro }'��'ty/Escrow. `�.:��r ; {�°'".;:: '`��. �`� (a) Possession. The Seller agrees to de�� ' .,poss �n not later th the Closing ��4��`5..2��r .�.'. Date. Y��:�,w<.�� {��s��;,{ �ss�.�. (b) Utilities. City water an � er charges, elec��, and natural gas charges, fuel oil and li uid etroleum as shall be ro- �� een the art�� ythe Closin Date. Seller q p g p p ��` �� g shall arrange for final readings as of the Cl 'n�'.��-V �}��``i:' �� -f t Z,c,: ?{{4`.. (c) Personal P , ty. The Se�� rees to k�� . ove all debris and all personal � �`�,, property not included h�;�� e Property � fore the po�session date. Personal property not so removed shall be,� ��ned fo ' d to and sli 1 become the property of Buyer. The Buyer may inspect the P'r"op'�. 'mme ;� ely prior to' ��.��ng and deduct from the purchase price payable at closing an amo � e � � ecessar ;t o pay for the cost of removal of any debris ,3 � ., �� or personal � en re�; � ng o �.�� y. The provisions of this paragraph shall not merge wi ��le'�`e ' � all s . e closing on the property. �s��` `�c��tr j= , 3' Ea��` 4 t_ �, {:�7 �_ ��;�s4 Escrow. �� agree`•� `a�t, at closing, Buyer may retain Five Hundred Dollars ($500.00��=.�J�,� the purcha��• rice ;�ar the Property as an Escrow for payment of personal �. :; property reri�:��,, disposal �rges and utility charges. The retained amount, less deductions provided for th��$3�aragrap�F`;f , will be delivered to Seller no later than 60 days following the Closing Date or d��,�,y of�nssession, whichever is later. Said funds shall be held by Kennedy & Graven, Chartered, as::��ow Agent, pursuant to the terms of the Escrow Agreement attached here as Exhibit C. (e) Amounts Due. The Buyer's ability to deduct amounts due under this paragraph from the retained escrow is not exclusive but is in addition to Buyer's rights at law and equity to collect such amounts from Seller.The Seller is responsible for the amounts due under this paragraph even i£ (i)Buyer neglects to deduct the amount from escrow; or (ii) the escrowed amount is insufficient to pay all amounts due under this paragraph 8. 9. Seller Warranties. 5 315418v3 CBR RC125-41 (a) Sewer and Water. Seller warrants that the Property is connected to City sewer and City water. (b) Mechanics' Liens. Seller warrants that, prior to the closing, Seller shall pay in full all amounts due for labor, materials, machinery, fixtures or tools furnished within the 120 days immediately preceding the closing in connection with construction, alteration or repair of any structure upon or improvement to the Property. � �� =��{,� (c) Notices. Seller warrants that it has not rec ' 'ed any notice from any governmental authority as to violation of any law, ordinance o��' : ';z�'on in connection with the Property. ��`� �� rz�>,. ��a,. `�.: '��. ��> (d) Tenants. Seller warrants that the Pro� y i`s not now oc �`: d by tenants and was not occupied by tenants at the time Seller first beived B yer's written o' �,�purchase the �� `ES �i:> Property. �� °�� ..� � '. L�. j�"'�y�,�� y��5�•"� (e) Broker Commission. Seller represents�: '�� has utilized the services of a real �.�v estate broker or agent in connection with 's Purchase Agreerig��nd the transaction contemplated �:..� by this Purchase Agreement. Seller agre � the commissi. '��nd any other fees charged by `�£ � its broker or agent on the Closing Date. { "„ • es to indem �} ,:�1`efend, and hold harmless the Buyer against any obligation or bili $K. � d to a�`�eements, arrangements, or . �� an third erson. understandings made or claimed to have been � de ` �• ��'��i- Y p ��-�., �v ... �> (� Struct : �. T�'`�'. er warrants� at the bui�dings, if any, are entirely within the boundary lines of th�� ,.:erty. `Y arties ackno . ed�e that the Property is being sold in "as is" ;. �� condition relating to the`�� .` tural erational, an��chanical systems. � ��` ;�'�� _ �.� �� :� ��, .�,�,� 10. ��yk;' ' .F�osts ` rding ie��eed Tax. The Buyer will pay: (a)the closing fees charged,�,��y��the ti �;_� urari�.`��'`�r other closing agent, if any, utilized to close the trans��i��n contemplate {�his A� r ��it; (b) fees for title evidence obtained by Buyer; and (c) the�eco�''�".' fee for the de �; :ansfe � `title to Buyer. Seller will pay all other fees normally paid �s��. by sellers, �; ,��ding (a) any'. {nsfer'taxes, recording fees and Well Disclosure fees required to enable Buyer ��ord its dee �from Seller under this Agreement, and (b) fees and charges related to the filing of��;�strume#�srequired to make title marketable. Each party shall pay its own } <� attorney fees. �_ ;`,,,�,$5 � �t 11. Inspechons. From the date of this Agreement to the Closing Date, Buyer, its employees and agents, shall be entitled to enter upon the Property to conduct such surveying, inspections, investigations, soil borings and testing, and drilling, monitoring, sampling and testing of groundwater monitoring wells, as Buyer shall elect; provided,that Seller is given at least 24 hours' notice. 12. Risk of Loss. It there is any loss or damage to the Property between the date hereof and the Closing Date, for any reason including fire, vandalism, flood, earthquake or act of God, the risk of loss shall be on Seller. If the Property is destroyed or substantially damaged 6 315418v3 CBR RC125-41 before the closing date, this Agreement shall become null and void, at Buyer's option. At the request of Buyer, Seller agrees to sign a cancellation of Agreement. 13. Default/Remedies. If Buyer defaults in any of the covenants herein, Seller may terminate this Agreement, and on such termination all payments made hereunder shall be retained by Seller as liquidated damages, time being of the essence. This provision shall not deprive either party of the right to enforce specific performance of this Agreement, provided this Agreement has not terminated and action to enforce specific performance is commenced within six months after such right of action arises. In the event Buyer defau its performance of the terms of this Agreement and Notice of Cancellation is served upon `yer p�rsuant to Minn. Stat. Section 559.21, the termination period shall be thirty (30) d ermitted by Minn. Stat., Section 559.21, Subd. 4. �� ., 14. Notice. Any notice, demand, request or{. ��x�o unica J' ;� hich may or shall be given or served by the parties, shall be deemed to .� been given or serve `� e date the same is personally served upon one of the following i d recipi, ts for notices � � �posited in the United States Mail, registered or certified;$ret �� eceip ��uested, posta prepaid and addressed as follows: `z`. -' � ,�;;. .�_. SELLER: k�� ` �� .� , �, ��{�,� �� :� �a�� -��:sr. . .�. BUYER: � using and Re v �pment`�A' ority of the City of Richfield ��J- � Housin S ialists ��.4 �� g p 67 ortland Ave e South ��``�� '� Ric ld, MN 5542 .��r= : r� �. � �:- �� AGE •: e �Jk ��y��:,. � �' , Chartered � }��.��'`?`��n A + � : Julie Ed mgton and �} +� S/�. ��.. > � �, Cath`� e B trlZocklitz ��.�,� k�> ° ,�: ��,«, � 70 U. nk Plaza ��j>.t ��-}�A� 0 So� Sixth Street '��:�. � . ��3��y. ��. `,inneapolis,MN 55402 �_� :�,;,, `" ��v,�.,t ��r �. 15. En��gr��ent. This Agreement, Exhibits, and other amendments signed by ,a4�,� ?*�S the parties, shall con��'the entire Agreement between Seller and Buyer and supersedes any �.b,.' other written or oral ��eements between the parties relating to the Property. This Agreement can be modified only in a writing properly signed on behalf of Seller and Buyer. 16. Survival. Notwithstanding any other provisions of law or court decision to the contrary,the provisions of this Agreement shall survive closing. 7 315418v3 CBR RC125-41 IN WITNESS WHEREOF,the undersigned have executed this Agreement on the date and year above. Buyer: Seller: Housing and Redevelopment Authority of the City of Richfield James L. Monahan by Mark Herll;his attorney in fact �>.. ��h�•.. By: ��:t�s:, f�' y Its Chair ��'� Kristi K. Mona ,` � by :, ��Herll, her attorney in fact �: u � ��x.. �° ��'=� And by: ;� h>- , ��. �-�-'�->=s,. _�:�5 .�: <:�� `•? ��`'`�, -$f` ��` Its Executive Director Ke�' ��; Monah�by Mark Herl ;< �t'orney in fact � ��. � ,� � `. '.;¢i:��X�� ,� .�'�''�., � � JoAnn Monaha�i�-' =.1Vlark Herll,her attorney in fact ..� > ,'S��' ' ,�'�f, �,�` � ��;:;�:, s�s r�� t ' �a M.,� -��'�?�y Mark Herll,her attorney in fact � � �` 3��'��•'.>'�,'fi' �' :. j';. -s`�;�` b �`-��:. '� �. �•, :a��`�a. ��r.. �'} �'�'x� .. irt� �� ";iu`. ��, .��:;. Mar��` erll ��F t � Y'%i+ z +fh . � � �t�� ti�'. .��,�-��.� ,�� 9r �1 �^��"`�,�,��a ��' v�`t` ��v�,k �� " '`�%`�r�� \ X� �}y t\�. K�d< -4�.•k�n,��",sf,s•'' i' .s '. �} i°j''+'.: '��: � � �}�:y�'.: `{F��y,�� ," n��I.�,�t rr ��'i,+.�'�^,a,�,�'`,".. ':ayU:"- " �''�r��' f:� -2; . �� _ 4t,> s2�t; �y�2:'�` '� �'J� '33 �� , �� '1�{:� {;' ':�{�,":�i'�5 ,�}-',, 8 315418v3 CBR RC 125-41 EXHIBIT A Legal Description of PropertY Lot 002, Block 009, Fallden's Third Addition, Hennepin County, Minnesota z�. � ��,. z; ..� a£` ��:: ..�x 5Y`�� ,�� . �(,�� '�Yi. V ��?. �y,�Ln'2;., ti1. .i�:4��'� ��'�{i".. �,Y� a �'� �i`�LL ��, p ,,�,+N:>��'E''� 'Zij �� :{�� ..�w� ��`�S ..s�� .'�. �;; ,fi�";., y�.ti• ��: �. ,,t� .. ��. �. .��rs'z� � �� ,�' � g �, , � �. � � �.`� h ��:�<:, ,�� . ��'��h��i;.4 ¢��"�n.. ` �k��` .�,�� ^� � 2 �� . ..�h'�2:.•�hi Y''. � �?� 1's � f ��W K�� •�� . �i�F,��, �y ��+� � �_ t ��3'�,.��4�,y�'� .,�.��'��z � �';;i �`;� �,�.. �r��iz�� '�t � �w� �� f 1 � x'�' 3L�,{s,: ~' ,.{s}{a 3 5�;: Yx un,.,K� ��:�>�;�. ��,..� >�ti: a< w �,. �� r�4_. !� �,��,,. ^, h 1,. � .S ..`: � ti 4;;t�, �{� � 1 4��:'f.� �^� �5 z �f��_ �� `\�:t�:a �5i S„ t`.�: L; ��.��;!y.o.s;.;_J- �..C•X�,;:s- �`.;Jft,'4,:.. �:�,: 'it,p A-1 315418v3 CBR RC125-41 EXHIBIT B Escrow A�reement THIS AGREEMENT entered into this day of , 20_, by and between ("Seller"), the HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, a Minnesota municipal corporation �`Buyer"), and KENNEDY & GRAVEN, CHARTERED ("Escrow A " or"Agent"). RECITALS � A. Seller and Buyer have entered into a Purc }J"�greem � ted , 20_ ("Purchase Agreement") for ��,s�le of " �: rty located at , Richfield, � ,- innesota and legall cribed on the attached E�ibit One(the("Prope '� • �r, �� ` kS`l , B. The parties desire to close the sale of th ' :� � y or� �3 A � > > MENT �� . . a$'�S The parties agree as follows: :s`�;�� `S�� ,R:: t � rx � 1. Deliver of � ssion. Seller �eliver� sion of the Property to Buyer in Purchase reement �' ntered into b the arties. The accord g Y P Purch greem equires Sel to pay all utilities and to remove all personal prop rt the P erty upon clo,' ,�: � �. . . �� 2. �:<.= s . (a) c o + ecution of this Agreement, Seller agrees to $s�� `e ' escr . e sum of 500.00 (the "Escrowed Funds") from the purchase '��`� price,to : d by " t ir�.a non-interest bearing account. ��;. ,�_��:. . <:..� � d"� �. a;l �. " ��:�(b) Within �h �' s aft� requested by Agent, Buyer shall provide to Agent (with �,x� ��y to Selle �}., vidence of expenses incurred for the removal and disposal of -��:.�� a�nal prop�ty and for payment of utility charges for services provided to the ,x,a� Pro�,F -.�`pri��to date of possession, if any. Agent shall reimburse Buyer for the incurr`�" -�?�enses from the Escrowed Funds within 7 days following receipt of �. such ev��ence from Buyer. (c) Agent shall deliver to Seller the balance of the Escrowed Funds on deposit, less deductions provided for in paragraph 2(b) above, no later than 30 days following vacation of the Property by Seller. (d) The sole duties of Agent shall be those described herein, and Agent shall be under no obligation to determine whether the other parties hereto are complying with any requirements of law or the terms and conditions of any other B-1 315418v3 CBR RC125-41 agreements among said parties. Agent shall have no duty or liability to verify any amounts deducted from the retained amount and Agent's sole responsibility shall be to act expressly as set forth in this Escrow Agreement. 3. Escrow Agent Liabilitv. The sole duties of Escrow Agent shall be those described herein, and Escrow Agent shall be under no obligation to determine whether the other parties hereto are complying with any requirements of law or the terms and conditions of any other agreements among said parties. Escrow Agent may conclusively rely upon and shall be protected in acting o � " �notice believed by it to be genuine and to have been signed or presented � e p�aper party or parties, consistent with reasonable due diligence on Escri�, :�• ent's part. Escrow Agent shall have no duty or liability to verify any su ;�oti �`=¢ �}d its sole responsibility shall be to act expressly as set forth in this sc w Agre �` t. �� ,,��,.�s y ��; Seller and Buyer understand that Age �: ��y legal counsel to Bu� d each consents to Agent's serving as Escrow Age.' � twithst` ding such repr �on. In the event Agent determines, in its so e � ' ' ion, 't cannot conti • to serve as Escrow Agent herein, Agent shall deposi �.. :�nds ith Old Re ublic National Title Insurance Compan or such other . Agent acceptable to Seller and Buyer. Seller consents to � t's continued re � - tation of Buyer after a deposit is made, and Buyer agrees to � ' �scrow fees c� � ,r�y the substitute Escrow ��:' Agent. `� ��,:�� , �� ,� . , �:�`,`�._>�'�'�. . :: 4. Notices to nt to the par� `,t�i this t�' ;:�ment shall be sent by mail or � z.F personal, �: � K�:. SEL�,� � ��t � ��`�`3�:>. < �� .�.�: �� . {kt . � `'�I{`�d.- {�,i �� 3�+43252��4a. �i �}'S � '�� :G av }.� � z.;, �� ^�.. .��} BUYE��rj�� ;:�, � u�}ng and Redevelopment Authority F `<r�$�, �`�� '�and for the City off Richfield ��y�` � t3: ��3 �{�'�� f� 11: �� . �:� 3�, ��• ��.2� �Y� .Richfield City Hall -s�� ^ ��` 6700 Portland Avenue South ,��;�;,�:, Sr '�� Richfield, MN 55423 �..Y.'�:.�;:2.�`:*_ ��:' �::�j�n`•> y�`"��5. AGEN'��J Kennedy & Graven, Chartered ATTN: Julie Eddington and Catherine B. Rocklitz 470 U.S. Bank Plaza 200 South Sixth Street Minneapolis, MN 55402 IN WITNESS WHEREOF, the parties have executed this agreement as of the date written above. B-2 315418v3 CBR RC125-41 SELLER: BUYER: HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD By: �� Its Chair � ;�, �:. �• � And by: ��`Y° ' �y. Its Execut� '�ec�or ��` '�` ;�' ; ��F �4 �; • � ;;� :., � �� '��`:� �.��_ � ESCROW AGENT: '}� {`` KENNEDY & GRAVEN, CHARTERED ��k� �""� ';�y 5,��} ��. �� 4 ��: BY: "�.�,�`� �� 4��,{x.�'u�:�;;<, }"W:��?� Y�Q ,4` `r��k� � �� 4 ` :�� '� � � �� $"i�y �S�'a . `�L�s � {,�,,�.,'+s�"^r U5 -�3 _ t S�4 ��"�� ,��`� �N'� �}.�'.t�$�'S�'�n ��t j� }{{?��i` ��, �'�,.�`�. 'y�;, �{��`` '��k� �� ''`-� . ��`F„ _��`'?� s 4 �� ,��X� ��ti ��. -�'�,cz �. k�ry� �X ��1v � ��^':r�:s? ti.,,,h ,.r$;,{:t�:�:� r y�� :.``:��t� `>:k '�s-.c..�?::.:t:,: �".� . . �''4,¢�4�,..� '>},.. B-3 315418v3 CBR RC 125-41 Exhibit One Legal Description of Property Lot 002, Block 009,Fallden's Third Addition, Hennepin County, Minnesota �� w �� {Y �`�� R .��`,�.�, � � /� � .,��:x+•?X?;d r�,�,��, � �� {L��,�� '� � � ¢F , � f �' �;�•� . * �°��z � ;,� `}} ��} �� i'��• •,3 ,v��{��' � �s%:`J� 4�� +�'9'' ,�:��,�`;;�. • . �:: "�. � .,Y. `��. `<x �� "e... ��; �::.. 1<. � t L•k'�hi-r��. ,l.:ti�" 5, • �:{.. ;`{,�k`'�''. ,'�y�,�'it� �.� {ti�� ,� F�. ��, ��N ��c�,, �� F�.,. �:. ,��:.N��F. `�-�;•i.. �A,��: t� B-4 315418v3 CBR RC125-41 AGENDA ITEM#: 4 REPORT#: 30 STAFF REPORT ,�► � � ' HOUSING AND REDEVELOPMENT AUTHORITY MEETING AUGUST 18, 2014 REPORT PREPARED BY: JULIE URBAN/KATE AITCHISON, HOUSING SPECIALISTS N,�E�r�TLE REPORT PRESENTER: JOHN STARK, COMMUNITY DEVELOPMENT DIRECTOR L,TITLL ACTING DEPARTMENT DIRECTOR REVIEW: f SI TURE � i _ " �, ` REVIEWED BY EXECUTIVE DIRECTOR: � ITEM FOR HRA CONSIDERATION: Public hearing and consideration of a resolution authorizing the sale of 7225 1st Avenue to Endres Custom Homes and a Contract for Private Development with Endres Custom Homes for the construction of a sin le famil home under the Richfield Rediscovered Pro ram. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: 1. Approve a resolution authorizing the sale of 7225 1st Avenue to Endres Custom Homes, Inc. and; 2. Authorize execution of a Contract for Private Development between the Housing and Redevelopment Authority and Endres Custom Homes, Inc. for the redevelo ment of 7225 1st Avenue. II. EXECUTIVE SUMMARY Endres Custom Homes, Inc. (the Builder) is applying to purchase the HRA-owned lot at 7225 1st Avenue to construct a new single family home. The new home would be a two-story home with three bedrooms, three bathrooms and an attached- garage. The new home will be approximately 2,000 square feet with an end value exceeding $330,000. 081814 RR Lot Sale 7225 1S'Avenue.docx III. BASIS OF RECOMMENDATION A. BACKGROUND • The Housing and Redevelopment Authority (HRA) purchased 7225 1st Avenue in the fall of 2012 for $105,000. • The existing home was abated and demolished in 2013. • The property was a 100-foot wide double-lot, and was subsequently subdivided into two fifty-foot lots. The subdivision was approved in the fall of 2012. • Endres Custom Homes bought and built a new single family home on the south lot (7229 1st Avenue) in 2013 which sold for $356,000. • The proposed home has a different design than the home that was previously built at 7229 1st Avenue. B. POLTCY • The proposed project meets the objectives of the Richfield Rediscovered Program: o Removes substandard, functionally obsolete housing and eliminates its blighting influence. o Provides new, higher valued housing. o Alleviates shortage of housing choice for families. • The project meets fhe Housing Design and Site Development Criteria, as defined in the Richfield Rediscovered Guidelines. C. CRITICAL TIMING ISSUES • The Contract requires the Builder to close on the property by October 1, 2014 and to complete construction by February 1, 2014. • A provision has been added to all Richfield Rediscovered contracts authorizing staff the ability to grant an e�ension to these deadlines for a period up to six months. D. FnvaNClaL • The HRA acquired the 100-foot property and structure in 2012 for $105,000. • The appraised value of the subdivided property (50-foot lot) as a vacant lot is $55,000. • Under the terms of the Contract, the $55,000 will be due at closing. • The Builder proposes to build the house to achieve MnGreen Path certification. If the certification is obtained, the Builder will qualify for a $5,000 credit. • Under the terms of the Contract, the minimum market value of the house will be $330,000. • Under the terms of the Contract, the Builder must submit a $10,000 cash escrow to be held until construction is completed as provided in the Contract. E. LEGAL • The HRA Attorney has reviewed the terms of the Contract for Private Redevelopment. • No public notification is required on this item; however, due to the potential impact of construction activities, a courtesy notice was issued to residents within 350 feet of the property. IV. ALTERNATIVE RECOMMENDATION(S� • Do not execute the Contract for Private Development. • Amend the Contract for Private Development and direct staff to work with the Builder to revise the proposal. V. ATTACHMENTS • Resolution • Photo of 7225 1 st Avenue • Elevations and floor plans of proposed home • Site plan of proposed home • Contract for Private Development • Photo of home previously constructed on south portion of lot. VI. PRINCIl'AL PARTIES EXPECTED AT MEETING • Dustin Endres, Endres Custom Homes, Inc. HRA RESOLUTION NO. RESOLUTION AUTHORIZING THE SALE OF REAL PROPERTY LOCATED AT 7225 1ST AVENUE TO ENDRES CUSTOM HOMES, INC. WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA) desires to develop certain real property pursuant to and in furtherance of the Richfield Rediscovered Program adopted by the HRA, said real property being described as: • Address: 7225 1st Avenue South Legal: Lot 12, Block 1 "Scheubles First Addition," Hennepin County, Minnesota WHEREAS, the HRA is authorized to sell real property within its area of operation after a public hearing; and WHEREAS, the purchasers of the described property have been identified as Endres Custom Homes, Inc., and WHEREAS, a Contract for Private Development has been prepared, and the sale price of 7225 1st Avenue is $55,000.00 with performance security in the amount of $10,000; and WHEREAS, a public hearing has been held after proper public notice. NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota: 1. A public hearing has been held and 7225 1st Avenue is authorized to be sold for $55,000.00 to Endres Custom Homes, Inc.; and 2. The Chairperson and Executive Director are authorized to execute a Contract for Private Development and other agreements as required to effectuate the sale to the Builder. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 18th day of August, 2014. Suzanne M. Sandahl, Chair ATTEST: Doris Rubenstein, Secretary 7225 1St Avenue South (vacant lot for sale) , , �y=%x�.- . `�'ry�' ,� ` �'. ,'�1 � .� ��* ,�� , ,�r�` ��`�� . � � '. '�",_ 'r .�s*A�31� '� '� �� s� (.' . i� i�,;i� *,� ,.�.� v t. _ '�,�j�i. �i� 1 .' '_i. �� f i. . . ,G/� � � �,��7 t'; . 'F\ .. �";�n', � *'' ��' R .� T��'. I� �`r �� ,n� �.�L.� . t k .�: �:,af.� �. c�- �;:' L.,�. ��' ,I��s -.�^ i_' �.r1 .,�ti �4 � *y '�"a�• �fi � � ;��'' v ' _k � �`� 1 f Y j�� }Y,�A, �� ", � �� ' : �;'�� :�3 4.YFY �`. 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' � , - --�.—.:;_ ! � , _ _<:� .. - � I � ___ _ _. . _. _ _ __ __ ";_ 'u ?=_w � � .--„p;—,_�,.-f-r - - _ - -_ __I_ __ _ _ — 1 � -� _ ; �� t � �,� � � I� = � �I , � �., �_. �,:. � . : _ ---�- � �� , r �� . ��t�s� �, _ _ . .. .... ..... . ... . . .... . ... . .. . . 1 II : --� , _. . o.2uNDER04TikC:kAECS .:-4� � ' I - ..� ___ ________ ___ ..I I �i� _ —_ _ _' ' _ . ..... .. . .. . .. �� . �'� i � � y . 1 � j I ' ' � f I � � ( . �II YII � --C I I ( � -�� " y �- �� f CONTRACT FOR PRIVATE DLVELOPMENT THIS AGREEMENT, made and entered into as of this day of ,20 , by and between the Housing and Redevelopment f the State1 of Minnesota, having Rs pr nc�pal public body corporate and politic under the laws o office at 6700 Portland Avenue, Richfield, Minnesota (HRA) and Endres Custom Homes, Inc. (Builder). WITNESSETH: WHEIZEAS, the City of Richfield (City) and the I3RA have previously created and established a Redevelopment Project (Project) pursuant to the authority granted in Minnesota Statutes, Sections A69.001 through 469.047{collectively,the Act); and WHEIZEAS, pursuant to the Act, the City and the HRA ha�e previously adopted a redevelopment plan for the Project(Redevelopment Plan); and WHEREAS, in order to achieve the objectives of the Redevelopment Plan and particularly to inake specified land in the Project available for development by private enter�rise for and in accordance with the Redevelopment Plcosts in the Proj ct; nd rmined to provide substantial aid and assistance to finance development WHEREAS, the Builder has proposed a development as hereinafter defined within the Project which the HRA has determined will promote and carry out the objectives for which the Project has been undertaken, will assist in carrying out the obligations of the Redevelopment Plan, will be in the vital best interests of the City and the health, sahe a�c blef state a d residents and is in accor d wit h t he pu b l i c p u r p o s e s a n d p r o v i s i o n s o f t p p local laws and requirements under wliich development in the Project has been undertaken and is being assisted. I+iOW, THEREFORE, in consideration of the mutual covenants and obligation of the HRA and the Builder, each party does hereby represent, covenant and agree with the other as follows: ARTICLE I. I➢EFINITIONS EXI-�IBITS RULE� OF INTERI'It�TA'TION Seetioa► 1.1. De�nitions. In tliis Agreement, the following terms have the meaning given below unless the context clearly requires otlierwise: �uildin� Pl�ns. Detailed plans for is uan pe of bu ld n pe ni t tructed on the Property, as required by the local building official for 401253��8 CBR RC125-326 1 Construction Plans. The construction plans approved by the HRA pursuant to Section 4.1 of this Agreement. The Constructielmatics oflthe Improvements t�be co st uct d,�and a Improvements, prelirninary plans and sch landscaping plan. Development. The Property and the Improvements to be constructed thereon according to the Construction Plans approved by the HRA. Event of Default. Event of Default has the meaning given such term in Section 8.1. Guidelines. The Richfield Rediscovered Program Guidelines Lot Sale Prograin, revised April 23, 2013, and attached as Exhibit B to this Agreement. Homeowner. The individuals purchasing the Property from Builder and who will be living in the home following purchase. Imurovements. Each and all of the structures and site improvements constructed on the Property by the Builder, as specified in the Construction Plans to be approved by the HRA. Minimum Market Value. $330,000, which is the minimum market value for the laud and Improvements as confirtned by the Hennepin County Assessor. Mort�a�e. A mortgage obtained by the Builder from a third party lender in accordance with Section 7.2 of this Agreement. Pro er . The real property legally described as: Situated in Richfield, County of Hennepin, State of Minnesota: Lot 12, Block 1, Scheubles lst Addition. � Located on land having a street address o£ 7225 1St Avenue S,Rich�eld MN 55423 Unavoidable Delavs. Delays which are the direct result of strikes, labor troubles, fire or other casualty to the Iinprovements, litigation coininenced by third parties which results in delays or acts of any federal, state or local government, except those contemplated Uy this Agreeinent, which are beyond the c�ntrol of the Builder. Section 1.2e Exhibits. The following Exhibits are attached to and by reference made a part of this Agreement: A. I'orm of Certificale of Completion B, Program Guidelines—Lot Sale Program ao�as3.�a ct�rz�cias-32� 2 C. Form of Quit Claim Deed D. Well Disclosure Section 1.3. Rules of Internretation. (a) This Agreement shall be interpreted in accordance with and governed by the laws of the State of Minnesota. (b) The words "herein" and "hereof' and words of similar import, without reference to any particular section or subdivision refer to this Agreement as a whole rather than any particular section or subdivision hereof. (c) References herein to any particular section or subdivision hereof are to the section or subdivision of this Agreement as originally executed. (d) Any titles of the several parts, articles and sections of this Agreement are inserted for convenience and reference only and shall be disregarded in construing or interpreting any of its provisions. ARTICLE II. REPRESENTATIONS AND UNDERTAKINGS , Section 2.1. Bv the Builder. The Builder makes the following representations and undertakings: (a) The Builder has the legal authority and power to enter into this Agreement and has duly authorized the execution, delivery and perforniance of this Agreement; (b) The Builder has the necessaiy equity capital or has obtained commitments for financing necessary for construction of the Impro��ements; (c) The Builder will construct the Improveinents in accordance with the terms of this Agreement and all local, state and federal laws and regulations; (d) Tlie Builder will obtain, in a timely inanner, all required permits, licenses and ap�rovals, and will meet, in a tiniely manner,the requirements of all local, state and federal laws and regulations which must be obtained or inet before the Improvements may be constructed; (e) The plans for the Improvements have been prepared by a qualified draftsperson or architect; and (� The Builder has read and understands the Guidelines and agrees to be bound by them. 401253v8 Cf3R RC125-326 3 Section 2.2. Bv the HIZA. The HRA makes the following representations as the basis for the undertaking on its part herein contained: (a) The HRA is authorized by law to enter into this Agreement and to carry out its obligations hereunder;and (b) The H1ZA will, in a timely manner, subject to all notification requirements, review and act upon all submittals and applications of the Builder and will cooperate with the efforts of the Builder to secure the granting of any permit, license, or other approval required to allow the construction of the Improvements. ARTICLE III. ACQUISITION OF PROPERTY; CONVEYANCE TO BUILDER Section 3.1. Purcliase of Pronertv bv Builder. The HRA agrees to sell the Property to Builder and the Builder agrees to purchase the Property from the HRA in an "as-is" condition. The sale of the Property is contingent upon the Builder providing the HRA with evidence satisfactory to the HRA that Builder has entered into a binding legal commitment, in the form of a Purchase Agreement for the resale of the Property to a Homeowner following completion of the Improvements. The HRA agrees to convey the Property to the Builder by Quit Claim Deed in the general form of Exhibit C. The HRA's deed to the Builder will contain the right of reverter required in Section 8.3. The purchase price for the Property, payable at Closing, will be $55,000 ("Purchase Price"). Section 3.2. Title and Examination. As soon as reasonably possible after execution of this Contract for Private Development by both parties, (a) HRA shall surrender any abstract of title and a copy of any owner's title insurance policy for the property, if in HRA's possession or control, to Builder or to Builder's designated title service provider; and (b) Builder shall obtain the title evidence determined necessary or desirable by Builder or Builder's lender, including but not liinited to title searches, title examinations, abstracting, a title insurance cominitment or an attorney's title opinion, at Builder's selection and cost, and provide a copy to the HRA. 'The Builder shall have 20 days from the date it receives such title evidence to raise any objections to title it inay have. Objections not inade within such time will be deemed waived. The HRA shall have 90 days from the date of such objection to effect a cure; provided, however, that the HRA shall have no obligation to cure airy objections, and may inform Builder of such. The Builder may then elect to close notwithstanding the uncured objections or declare this Agreement null and void, and the parties will thereby be released fi•om any further obligation hereunder. 401253v8 C13R RC125-3?.6 4 Section 3.3. Taxes and Snecial Assessments. Real estate taxes and installments of special assessments will be prorated between the HRA and Builder as of the date of closing. Section 3.4. Soil Conditions and Haza a�s to th conditio seof the so ls on�heePgoperty, the HRA makes no representations or warranties its fitness for the construction of improvements or any other purpose for which the Builder may use the Property, or regarding the presence of hazaru lder to tconduct suchpt st egard g soils allow reasonable access to the Property for the B conditions and hazardous wastes as the Buyer may desire. Permission to enter the Property to conduct such tests must be given in writing under reasonable terms and conditions established by the HRA. Section 3.5. Site Clearance. The HRA will be responsible for clearance of all buildings as required to prepare the Property for development. All other site preparation is the responsibility of Builder. Builder will comply with all of the provisions of the Guidelines relating to tree protection, preservation and replacement. Section 3.6. Other Preconditions to Closin�. Closing may not take place until the I-IRA is satisfied that the Project is in all respects in full compliance with the provisions of the Guidelines contained in Exhibit B. It�e a�he 1 Gu d lhnes�so�thaa the 1Homeolwner w 11 have an in the various activities required un opportunity to contribute suggestions concerning development of the Property. 2014, ("Closing Section 3.7. Closin . Clo�seng edttoaby the Bu lder and�HR.A m v��riting. At Closing, Date") or such other date as may g the Builder will provide the HRA with a cash deposit for the escrow account established pursuant to Section 5.1, in addition to the Purchase Price. Section 3.8. Closing Costs. The Builder will pay: (a)the closing fees charged by its title insurance company or other closing agent, if any, utilized to close the transaction for Builder; (b)title services chosen by Builder pursuant to Section 3.2 above,including the premium for title insurance policy,if any, and (c)tlie recording fees for the Connact for Private Development and the deed transferring title to the Builder. HIZA will pay all other fees nornlally paid by sellers, including (a) any nansfer taxes, and (b) fees and charges related to the filing of any instrument required to inake title marketable. Each party shall pay its own attorney fees. Section 3.9. Sewer and Water. HRA warrants that city water is available at the lot line and city sewer is available at the curb. �ection 3010. ISTS Disclosure. HRA is not aware of any individual sewage treatment system on the pt•operty. Fiuyer is responsible for all costs of removing any individual sewage treatment system that may be discovered on the Property. ��ction 3011. Well Disclosureo HRA's knowledge of wells on the Property is disclosed in Exhibit D. 401253v8 CI3R RC125-326 5 ARTICLE IV. CONSTRUCTION OF IMPROVEMENTS Section 4.1. Construction of Imnrovements. The Builder shall construct the Improvements on the Property in accordance with the Guidelines and the Construction Plans, shall cause the Improvements to meet or exceed the Minimum Market Value specified in Section l.l, and shall maintain, preserve and keep the Improvements in good repair and condition. The Builder shall provide his or her proposed construction plans to the HRA for review; if the proposed construction plans are in conformity with this Agreement and the Guidelines, the HRA will approve the Construction Plans following review and comment by the Homeowner. Section 4.2. Construction Plans. No building permit will be issued by the City unless the Building Plans are in conformity with the Guidelines, the Construction Plans, the Builder's Minimum Market Value, other requirements contained in this Agreement, and all local, state and federal regulations. The Builder shall provide the HRA with a set of Building Plans to be used in connection with any application for a building permit. The HRA shall, within 25 days of receipt of the Building Plans review the same to detertnine whether the foregoing requirements have been met. If the HRA determines such Building Plans to be deficient, it shall notify the Builder in writing stating the deficiencies and the steps necessary for correction. Issuance of the build'ing pei7nit by the City shall be a conclusive determination that the Building Plans have been approved and shall satisfy the provisions of this Section 4.2. Section 4.3. �chedule of Construction. Subject to Unavoidable Delays, construction of the Improvements shall be completed prior to Februaiy 1, 2015 ("Construction Completion Date"). All construction shall be in conformity with the approved Construction Plans and the Guidelines. Periodically during construction the Builder shall make reports in such detail as may reasonably be requested by the HRA concerning the actual progress of construction. If at any time prior to cornpletion of construction the HRA has cause to believe that the Builder will be unable to complete construction of the Improvements in the time permitted by this Section 4.3, it may notify the Builder and demand assurances from the Builder regarding the Builder's construction schedule. If such assurances are not forthcoming or are deemed by the HRA at its sole discretion to be inadequate, the HRA may declare an Event of Default and may avail itself of any of the remedies specified in Section 8.2 of this Agreement. Section 4.4. Certi�cate of Comnletion. After notification by the Builder of completion of construction of the Improvements, the HRA shall inspect the construction to determine whether the Improveinents Ilave been completed in accordance with the Construction Plans and the terms of this Agreement, including the date of the completion thereo£ In the event that tlie HRA is satisfied with the construction, and upon closing on the sale of the Property to the Homeowner, the HRA shall furnish the Builder with a Certificate of Completion in the forni attached hereto as Exhibit A. Such certification by the HRA shall be a conclusive determination of satisfaction and termination of the agreements and covenants in this Agreement. Issuance of the Certificate of Completion shall also serve as a satisfaction of any obligation of Builder 401253v8 C[3R RC125-326 6 secured by the escrow account established under Section 5.1, and the cash in the escrow account will be released to the Builder. At the time a Certificate of Completion is issued, the HRA will also provide Builder with a $5,000 cash rebate if Builder has obtained .Green Community Concepts certification through LEED for Homes, Minnesota GreenStar, Minnesota Green Communities or Minnesota Green Path. If the HRA shall refuse or fail to provide certification in accordance with the provisions of this Section 4.4, the HRA shall within 15 days of such notification provide the Builder with a written statement, indicating in adequate detail in what respects the Builder has failed to complete the Improvements in accordance with the provisions of this Agreement necessary, in the opinion of the HRA, for the Builder to take or perform in order to obtain such certification. Section 4.5. Failure to Construct. In the event that construction of the Improvements is not completed as provided in Section 4.3 of this Agreement, an Event of Default shall be deemed to have occurred, and the HRA rnay proceed with its remedies under Section 8.2. ARTICLE V. REDEVELOPMENT ASSISTANCE Section 5.1. Establishment of Cash Escrow. Builder acknowledges that although it is purchasing the Property at its fair market value as raw land, the HRA has incurred significant costs in acquiring and preparing the Property for development by Builder. At Closing, Builder will deliver to the HRA $10,000 to be placed in a non-interest bearing escrow account pursuant to the Escrow Agreement, dated as of the date hereof,between Builder and HRA. The obligation to pay the $10,000 to the HRA will be forgiven, and the cash in the escrow account will be returned to Builder if: (i) the Builder receives a Certificate of Completion; and (ii) the Builder is not otherwise in default of any of its obligations hereunder. If such have not occurred, an Event of Default shall be deemed to have occurred and the I�RA may exercise its remedies under 5ection 8.2. In cei�tain circumstances, after construction is complete,the Builder or Buyer may be required to deposit another cash escrow with the planning department of the City for incomplete improvements. In these cases, following the HRA's release of the cash escrow, the cash escrow will be transferred to the City's planning department for such purpose. The terins of the escrow will be set forth in an Escrow Agreeinent betweeil the HRA and the Builder or Buyer. ARTICLE VI. FI1�IANCING Section 6s1. Financin�. HRA acicnowledges that Builder has submitted evidence of financing for the Improvements in compliance with the provisions of �ection 2.1(b) of this Agreenlent. Builder must notify HRA immediately of any changes to or withdrawal of the approved f nancing, HRA shall have 10 days to approve or disapprove changes in financing. If the HRA rejects a change in the approved financing or if the approved financing is withdra«m, 401253eR CBR RC12.5-32G 7 the Builder shall have 30 days or such additional period of time as the Builder may reasonably require from the date of the HRA's notification to submit evidence of financing satisfactory to the HRA. If the Builder fails to submit such evidence or fails to use due diligence in pursuing financing, the HRA may terminate this Agreement and both parties shall be released from any further obligation or liability hereunder. Closing shall not take place until Builder has provided HR A with acceptable evidence of financing for construction of the Improvements. Section 6.2. Coav of Notice of Default to Lender. Whenever the HRA shall deliver any notice or demand to the Builder with respect to any Event of Default by the Builder in its obligations or covenants under this Agreement,the HRA shall at the same time forward a copy of such notice or demand to each holder of any Mortgage authorized by the Agreement at the last address of such holder shown in the records of the HRA. Section 6.3. Subordination. In order to facilitate obtaining financing for the construction of the Improvements by the Builder, the HRA maythe extent the HRA deems discretioii, agree to modify this Agreernent in the manner and to reasonable,upon request by the financial institution and the Builder. ARTICLE VII. PROHIBITIONS AGAINST ASSIGNMENT AND TRANSFER Section 7.1. Representation as to Redevelopment. The B ose eof develo tm nt of the that its undertakings pursuant to the Agreement, are for the purp P Property and not for speculation in land holding. The Builder further recognizes that, in view of the importance of the Development to the general welfare of Richfield and the substantial financiiig and other public aids that ha�e been made available by the HRA for the purpose of making the Development possible, the qualification and identity of the Builder are of particular concern to the HRA. The Builder further recognizes that it is because of such qualifications and identity that the HRA is entering into this Agreeinent, and, in so doing, is further willing to rely on the representations and undertakings of tlie Builder for the faithful performance of all undertakings and covenants agreed by the Builder to be performed. Section 7.2. Prohibition A�ainst Transfer of Pro»ertv and Assi�nment of A�reement. For tlie reasons set out in Sectioii 7.1 of this Agreement, the Builder repiesents and agrees as follows: (a) Except as specifically allowed by this section, Builder has not made or created, and, prior to the issuance of the Certificate of Completion, Builder will not inake or create, or suffer to be made or created, any total or partial sale, assignment, conveyance, or any trust in respect to this Agreemeilt or the Property or any part thereof or any interest therein, or any contract or agreement to do any of the same,without the prior written approval of the�IRA. (b) This provision shall �iot be deemed as preventing the Builder from entering into a I'urchase Agreement for the sale of the Property to a Homeowner. 401253v8 CI3R RC125-32b s (�) This provision does not prohibit conveyances that are only by way of security for, and only for the purpose of obtaining financing necessary to enable the Builder or any successor in interest to the Property, or any part thereof, to perform its obligations with respect to the Development under this Agreement, and any other purpose authorized by this Agreement. Any Mortgage obtained by the Builder must be disclosevdth an addRress for he holder of he Mortgage Agreement. The Builder must provide the HRA for purposes of providing notices as may be required by this Agreement. ARTICLE VIII. EVENTS OF DEFAULT Section 8.1. Events of Default De�ned. The following shall be deemed Events of Default under this Agreement and the term shall mean, whenever it is used in this Agreement, unless the context otherwise provides, any one or more of the following events: (a) Failure by the Builder to pay when due the payments required to be paid or secured under any provision of this Agreement; (b) Failure by the Builder to observe and substantially perform any covenant, condition, obligation or agreement on its part to be observed or performed hereunder, including the time for such performance; (c) If the Builder shall admit in writing its inability to pay its debts generally as they become due, or shall file a petition in bankruptcy, or shall make an assignment for the benefit of its creditors, or shall consent to the appointment of a receiver of itself or of the whole or any substantial part of the Property; (d) If the Builder, on a �etition in bankruptcy filed against it, be adjudicated as bankrupt, or a court of competent jurisdiction shall enter an order or decree appointing, without the consent of the Builder, a receiver of the Builder or of the whole or substantially all of its property, or approve a petition filed against the Builder seeking reorganization or arrangement of the Builder under the federal bankruptcy laws�o n the date of entry thereofl or decree shall not be vacated or set aside or stayed witltin 60 days f (e} If the Development is in default under any Mortgage and has not entered into a work-out agreement with the holder of the Mortgage. Sectioa► 8.2� Remedies on Default. Whenever any Event of Default occurs, the HRA may, in addition to any other i•emedies or• rights given the HRA under tliis Agreement, take any one or more of the following actions following written notice by the HRA to the Builder as provided in Section 9.3 of this Agreement: 401253��8 CI3R RC125-326 9 (a) Suspend its performance under this Agraement until it receives assurances from the Builder, deemed reasonably adequate by the HRA, that the Builder will cure its default and continue its performance under this Agreement; (b) Cancel or rescind this Agreement; (c) Exercise its right under Section 8.3; (d) Withdraw all funds in the escrow account established in Section 5.1; (e) Withhold the Certificate of Completion; or (� Take whatever action at law or in equity may appear necessary or desirable to the HRA to enforce performance and observance of any obligation, agreement, or covenant of the Builder under this Agreement; provided, however, that any exercise by the HRA of its rights or remedies hereunder shall always be subject to and limited by, and shall not defeat, render invalid or limit in any way (a) the lien of any Mortgage authorized by this Agreement and (b) any rights or interest provided in this Agreement for the protection of the holders of a Mortgage; and provided further that should any holder of a Mortgage succeed by foreclosure of the Mortgage or deed in lieu thereof to the Builder's interest in the Property, it shall, notwithstanding the foregoing, be obligated to perform the obligations of the Builder under this Agreement to the extent that the same have not therefore been performed by the Builder. Section 8.3. Revesting Interest in HRA Unon Hapnening of Event of Default Subseauent to Convevance of Propertv to Builder. In the event that subsequent to the closing or the sale of the Property to the Builder and prior to the issuance of the Certificate of Completion: (a) The Builder fails to begin construction of the Improvements in conformity with this Agreeinent, and such failure is not due to Unavoidable Delays; (b) The Builder, after commencement of the construction of the Improvements, defaults in or violates obligations with respect to the construction of the Improvements, including the nature and the date for the completion thereof, or abandons or substantially suspends construction work,and such act or actions is not due to Unavoidable Delays; (c) The Builder or successor in interest fails to pay real estate taxes or assessments on the Property or any part thereof when due, or places thereon any encumbrance or lien unauthorized by this Agreement, or suffeis any levy or attachment to be made, or any supplier's or mechanic's lien, or any other unauthorized encuinbrance or lien to attach; (d) There is, in violatioii of Article VII of this Agreement, any transfer of the Property or any part thereof; or (e) 'The Builder fails to comply witll any of its covenants under this Agreement, 401253��8 CI3R RC125-326 l� then the HRA shall have the right upon 30 days' written notice to Builder and the Builder's failure to cure within such 30 days period, to re-enter and take possession of the Property and to terminate and revest in the HRA the interest of the Builder in the Property; provided, however, that such revestiture of title shall be subject to the lien of any prior encumbrance permitted under this Agreement, or any right of a Homeowner pursuant to a valid Purchase Agreement authorized by this Agreement. Section 8.4. No Remedv Exclusive. No remedy herein conferred upon or reserved to the HRA is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any sucll right or power or shall be construed to be a waiver thereof, but any such right and pawer may be exercised fi•om time to time and as often as may be deemed expedient. In order to entitle the HRA or the Builder to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such notice as may be required in this Article VIII. �ection 8.5. No Additional Waiver Imnlied bv One Waiver. In the event of the occurrence of any Event of Default by either party, which Event of Default is thereafter waived by the other party, such waiver shall be limited to the particular Event of Default so waived and shall not be deemed to waive any other concurrent, previous or subsequent Event of Default. ARTICI.E IX. ADDITIONAL PROVISIONS Section 9.1. Gonflict of Interests; Representatives Not Individuallv Liable. No HRA officer who is authorized to take part in any manner in making this Agreement in his or her of�cial capacity shall voluntarily have a personal financial interest in this Agreement or benefit financially there from. No mernber, official, oi• employee of the HRA shall be personally liable to the Builder, or any successor in interest, for any Event of Default by the HRA or for any amount which may become due to the Builder or successor or on any obligations under the terms of this Agreement. Section 9.2. Non-Discrimination. The provisions of Minnesota Statutes Section 181.59, which relate to civil rights and non-discrimination, and any affirmative action program of the City shall be considered a part of this A�reement and binding on the Builder as though fully set forth herein. Section 9>3. IrTotices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand ol•other coininunication under this Agreeinent by either party to the other shall be sufficiently given or delivered if it is sent by mail, postage prepared, return receipt requested or delivered personally: 401253��8 CaR RC125-326 I1 (a) As to the HRA: Richfield HFZA Executive Director 6700 Portland Avenue South Richfield, MN 55423 (b) As to the Builder: Endres Custom Homes,Inc. 15690 Duck Pond Way Apple Valley, MN 55124 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 9.3. Section 9.4. Counterparts. This Agreement may be simultaneously executed in any number of counterparts, all of which shall constitute one and the same instrument. Section 9.5. Extensions. Any extension to the Closing Date and/or extension to Construction Completion Date that exceeds 6 months from the date agreed to in Section 3.7 and 4.3, respectively, must be approved by the HRA Board. IIRA staff is authorized to extend the Closing Date to a date less than 6 months from the Closing Date agreed to in Section 3.7 and extend the Construction Completion Date to a date less than 6 months from the Construction Completion Date agreed to in Section 4.3. IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the day and year first above written. [signature pages follow] 401253v8 CI3R RC I25-32( 12 Signature Page for HRA THE HOUSING AND REDTVELOPMENT AUTHORITY IN AND FOIt THE CITY OF RICHFIELD,MINNESOTA By Its Vice Chairperson By Its Executive Director STATE OF MINNESOTA ) ) SS COUNTY OF ) The foregoing instrument was acknowledged before me this day of _, 20 , by , the Vice Chairperson of the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota, a public body corporate and politic under the laws of Minnesota, on behalf of the authority. Notary Public STATE OF MINNESOTA ) ) SS COUNTY OF_ ) Tlle foregoing instrument was acknowledged before me this day of , 20 _, by _, tlie Executive Director of the Housing and Redevelopment Authority in and for the City of Richf eld, Minnesota, a public body corporate and politic under the laws of Minnesota, on behalf of the authority. Notary Public 401253v8 CI3R RC125-37.6 13 Signature Page for Buitder Builder �r�.� �� r/�'� B Its �5 � STATE OF MINNESOTA ) ) SS COUNTY OF�e�i��'�i�_) The foregoing instrument was acknowledged before me this � day of I�tO'�"' , 20�, by ��N��5 , the i'�I of .�tG�i�fS uA' r� ►'1�t.l�.e , a �T Qy-d�p�,`, under the laws of ��2��1 , , on behalf of the DY�C4 �� rt � � • d�.- Not ry Public . . KA'THERINE M. AITCHISON - NOTARY PUBt.IC-MINNESOTA `��•� :� MyCommissionExp�resJanuarv3?2C+7 t ' r 401253v8 CBR RC125-326 14 EXHIBIT A FORM OF CERTIFICATE OF COMPLETION The undersigned hereby certifies that , has fully and completely cornplied with its obligations under that document entitled "Contract for Private Development", between the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota and dated , filed as Document No. (the "ContracY') with respect to the construction of the approved construction plans at , legally described as and is released and forever discharged from its obligations under such Contract. DATED: THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOK THE CITY RICHFIELD By: Its: Executive Director STATE OF MINNESOTA ) ) SS COUNTY OF HENN�PIN ) The foregoing instrument was acknowledged before me this day of , 20_, by the Executive Director of the Housing and Redevelopment Authority in and for the City of Richfield, a public body corporate and politic under the laws of the State of Minnesota on behalf of the public body corporate and politic. Notary Public This instrument was drafted by: Kennedy& Graven, Chartered 470 U.S. Bank Plaza 200 South Sixth Street Minneapolis, MN 55402 A-1 401253v8 CI3R RC125-326 EXHIBI'T B PROGRAM GUIDELINES-LOT SALE PROGI�AM RICH�IELD REDISCOVERED PI�OCa�M CUIDELINES LOT' SI�LE PRO(�RAIVI REVIS�D: April 23, 2013 401253v8 Cf3R RC125-234 B-1 PROGRAMOBJECTIVES............................................................................................................................3 DEFINITIOWS................................................................................................................................................3 PFtOGRAMBASICS .....................................................................................................................................3 APPLICATION REQUIREMENTS................................................................................................................4 ADDITIONAL F��QUIR�MENT�...................................................................................................................5 H�USE DESIGN AND SITE DEV�L.OPMENT REQUIREMENTS...............................................................5 NewHouse Standards............................................................................................................................6 SiteStandards.........................................................................................................................................6 ConstructionRequirements...................................................................................................................6 GeneralStandards..................................................................................................................................7 GreenCommunity Concepts..............................................................................................................:...8 CITY REVIEW PROCEDURE.....................................................................................................................0.8 LOT'SALE TO BUILDER/BUYER................................................................................................................9 PROGRAMMARKETING.............................................................................................................................9 DATAPRIVACY............................................................................................................................................9 I3-2 401253v8 CI3R RC 125-234 This document has been developed as a guidance tool for program administration. It should not be interpreted as constituting any contractual agreement or liability by the City or Housing and Redevelopment Authority(HRA). The HRA may modify or divert from the guidelines where it deems appropriate. I. Program Objectives 1. To remove substandard, functionally obsolete housing on scattered sites throughout the City and replace with new, higher-valued housing. 2. To eliminate the blighting influence of substandard housing, thus improving residential neighborhoods. 3. To alleviate the shortage of housing choices for families. 4. To facilitate the construction of targer three- to four-bedroom, owner-occupied homes designed for families. 5. To facilitate the construction of multi-unit, owner-occupied homes designed to expand family opportunities or to serve elderly residents. These objectives will be achieved through the sale of lots by the Housing and Redevelopment Authority to BuildeNBuyer teams for the development of newly constructed homes. II. Definitions Applicant: An individual who submits an application for a Richfield Rediscovered lot. The Applicant may be a Buitder or the end Buyec If the Applicant is a �uilder, an end Buyer should 'be identified. If the Applicant is the Buyer, the Applicant must submit a signed contract between the Builder and the Buyer to build a home on the lot identified in the application. Buyer.An individual(s)who will build, own and occupy a new housing unit in Richfield. The Buyer will occupy the property and not offer it for rent. The Buyer may not also function as the Builder on a Richfield Rediscovered project. The Buyer and Builder must be unrelated separate legal entities. A speculative project by a Buyer may be considered if all other program requirements can be met. However, neither the Buyer, the Buyer's Builder or Builder's subcontractors, or the Builder's realty agents may occupy or purchase the property. Buyers, unless licensed in the trade specified, may not put any sweat equity into the construction of the foundation, wall/roof framing, shingling, exterior work, electricaUplumbing/HVAC systems or interior carpentry. Builder. Contractor who has signed a contract with the Buyer to build a home on the iot identified in the application. Contract for Private Development: A contract between the HRA and the Builder or Buyer that establishes the conditions under which the lot will be sold and the proposed house will be developed. Green Community Concepts Plan: A written plan indicating how the proposed development will incorporafie green building features and concepts. Priority will be given to projects that incorporate green building features. HRA: Housing and Redevelopment Authority in and for the City of Richfield. Lot List: A listing of available lots for sale. Information regarding the lot location, size and sale price is provided. III. I'ro�ram Basics 1. HRA publishes a list of available vacant lots for purchase including sale price and development criteria. B-3 401253v8 Cf3R RC125-234 2: Builder/Buyer team proposes a plan for a lot consistent with development criteria and program requirements and makes an offer to purchase. 3. HRA approves lot sale. 4. Lot is sold to Builder or Buyer. 5. Builder constructs new home. 6. Projects must be completed within one year of HRA approval of the project. IV.Application Requirements The following must be submitted for application to the program: 1. $525 application fee An application fee must be paid at the time of application. This fee is non-refundable and is not part of the lot price. 2. Application Form 3. Blueprints The layout of all levels, including basement and unfinished space, must be provided. 4. Elevations Elevations of all four sides of the house, including view of garage shall be provided. Colored renderings may also be required. 5. Site plan � The site plan shall indicate the location of the new house, walkways and garage. 6. Landscaping plan A landscaping plan must indicate the location and type of trees, shrubbery, flowers and landscaping materials (e.g. rocks, mulch)and any existing trees to be preserved. 7. Detail of construction materials to be used on the project. 8. Green Community Concepts Plan The plan shou{d indicate what Green Community Concepts will be incorporated into the project. 9. Construction timeline Construction must be completed with one year of the purchase of the property. 10. Signed contract with Builder 11. Purchase agreement If the Builder plans to purchase the lot, the application must include a valid purchase agreement between the Buyer and the Builder for the lot to be developed. 12. Financial capability statement A statement from a financial institution indicating willingness to provide sufficient construction capifial to complete the project must be provided. 13. Builder References a. Five previous customers b. Three major suppliers, one being the construction supplier c. Building inspectors from two cities where the Builder has constructed new housing within the past three years 14. Proof of Builder's Comprehensive General Liability with Property Damage Protection. I�-4 401253v8 CI3R RC125-234 15. Proof of sufficient worker's compensation insurance coverage by the Builder. 16. Written warranty program To be provided to the Buyer, which guarantees at a minimum, warranted repairs as required by Minnesota State Statute. V.Additional Program Requirements 1. The Applicant is expected to meet with an architecturaUdesign consultant prior to submitting an application. A two-hour consultation is available through the HRA at a cost of$25 to the applicant. See the City's website (www.citxofrichfield.orq) for more information. This requirement may be waived if the applicant is using an architect for the project. 2. The site will be sold to the Builder or Buyer at the fair market value as appears on the Lot List. The HRA will not accept offers for less than the established sale price. 3. A Contract for Private Development is signed by the HRA and the Builder or the Buyer. The Contract is a standard form which includes conditions for acquisition and development of the property. The Contract will also establish a minimum required end-value for the property based on construction estimates provided by the applicant. The Builder or Buyer will be expected to agree to the terms of the Contract before the application can be scheduled on the HRA agenda. 4. All lots will have a required minimum end value that will be established in the Contract for Private Redevelopment. 5. The lot can be sold to either the Builder or the Buyer. If the lot is sold to the Builder, the Builder will pay cash for the lot at closing and submit a Letter of Credit or cash escrow for$10,000. The Lefter of Credit must be from a financial institution incorporated in the Twin Cities metropolitan area. The cash escrow will be held in a non-interest bearing account. The Letter of Credit or cash escrow will be released once the construction and landscape work are completed and a final . Certificate of Occupancy is issued. 6. If the lot is sold to the Builder and the Builder fails to complete construction as approved by the HRA, the Letter of Credit or cash escrow may be drawn upon by the HRA. In addition, the Contract for Private Development will contain a reverter provision, which will enable the HRA to reclaim ownership of the property in the event of a default in the Contract. In the event that the Builder fails to complete construction, the HRA may exercise its rights under the reverter provision, as well as draw upon the Letter of Credit or cash escrow. 7. If the lot is sold to the Buyer, the Buyer will pay cash for the lot at closing and a$10,000 mortgage in favor of the HRA will be filed on the property. The mortgage will be in first position. The HRA may consider subordinating its interest in appropriate cases. 8. If the lot is sold to the Buyer and the Buyer fails to complete construction as approved by the HRA, the HRA may exercise its rights provided in the mortgage. VL House Design and Site Development Requirements The development of all sites shall meet the development criteria listed below, as reviewed and approved by the HRA. To maximize the development of a given lot, the HRA reserves the right to explore all development options without obligating the HRA to support any specific proposal, idea or solicitation. Housing design is a critical element of the program. Siding materials, exterior fa�ade presentation, roof, window, siding and building line variability, finished landscape, interior space function and use are all important issues of design to the HRA. The design requirements were created to ensure that the homes built on the HRA-sold lots blend in with the surrounding neighborhood and respond to the specific concerns of the HRA. B-5 401253v8 CBR RC125-234 All new houses built under the Richfield Rediscovered Program must meet the requirements of the City's Zoning Code and additional criteria, as listed in this document. A. New House Standards 1. New dwelling must be owner-occupied. 2. Three finished bedrooms are required. 3. Two finished bathrooms are required. 4. Two-car garage is required. 5. A full basement is required, unless the selected design results in a split-level or a garden-level type of basement. In the case of an "accessible" house, a basement may be omitted if it would otherwise prohibit accessible design elements. B. Site Standards 1. After construction, the site must be fully landscaped, including plantings around the foundation. The entire grounds shall be landscaped and be aesthetically pleasing in all seasons. Land forms and plant materials shall be used to define the site and blend neatly with adjoining properties. Specific lot line blending requirements may be required, as appropriate, for specific sites. At a minimum, the applicant must meet the "Landscaping and Screening Requirements" in the City's Zoning Code under Section 544.03, Subd. 4, General landscaping requirements and Subd. 5, Residential sites. The code is available on the City's website: http://www.ci.richfield.mn.us To the greatest extent possible, existing trees should be preserved. Any trees removed must be replaced (they do not have to be the same species or in the same location) and should be labeled on the required landscape plan. 2. Utility meters shall be screened from street view and locations must be specified on plans. 3. Site drainage should be accommodated on the site so that water is directed away from the new home and the neighb�ring properties. Neighboring properties must not be disturbed by the creation of drainage swales. Specific storm water management requirements may be required, as appropriate, including the addition of gutters or on-site management for specific sites. Construction and the finished structure must not have a detrimental impact on storm water drainage patterns in the neighborhood. 4. All air conditioning units must be located in the rear yard of the house, or as approved by the HRA. C. Construction Requirements 1. Existing trees identified on the landscape plan as being preserved, must be protected during construction. A tree wrap with board reinforcements shall be used on trees directly adjacent to active grading and construction areas. Damaged or destroyed trees must be replaced. 2. The construction site, neighboring properties and adjacent public streets shall be kept free of construction debris at all times. 3. No construction workers, construction equipment or construction material shall encroach upon neighboring properties. B-6 40I253v8 CQR RC125-234 4. The property shall have a new sanitary service line installed to the City sanitary sewer main consisting of schedute 40 PVC or equivalent. If there is an existing 6" sewer stub at the property line, it must be lined with 4" schedule 40 PVC or equivalent to the Gity's sanitary main, and it must include a"donuY'at the end with cement. The line must be televised after installation to ensure the following: 1. There are no obstructions in the line. 2. The PVC liner is not protruding into the City's sanitary sewer main line. D. General Standar�ls 1. The value of the new home must meet or exceed the minimum value specified in the Contract for Private Redevelopment. 2. All homes in the Richfield Rediscovered Program must be stick-built or high-quality modular, new construction. 3. Exterior materials (siding, soffit, doors and windows) should be low-maintenance and durable. Brick, aluminum, �inyl and fiber cement siding are preferred. Natural cedar lap is acceptable if properly stained or painted. Hardboard panels or hardboard lap siding are prohibited. Roof �alleys must have metal valleys and not be woven. 4. Unit height and mass of the new house shall be compatible with the scale of the surrounding homes in the neighborhood. 5. Flans must present a balanced and pleasing distribution of wall, door and window areas from all views. 6. The dominance of the garage door must be minimized through placement, architectural detail, door design and utilization and design of windows. Garages, where the garage door faces the street, shall not be located closer to the front lot line than the foremost facade of the principal building facing the front property line. Garage sidewalls that face the street should appear to contain habitable space. This can be accomp4ished by incorporating windows and other design elements into the garage wall that are in character with the remainder of the dwelling. for lots that have alley access, the garage should be oriented to access the alley. 7. All building plans must have been prepared in consuftation with an architect or qualified draftsperson. All requirements by the Building Inspections Division must be met. 8. Alf Richfield Rediscovered houses must meet or exceed Minnesota Energy Code requirements. 9. All new homes shall be built to provide high quality sound insulation. Recommendations for sound insulation measures may be provided on a sifie-by-site basis. All construction must conform to current sound attenuation building standards for properties located within the 1996 65+and/or 2007 63-64 DNL contours. In cases where sound attenuation standards are required and an increase in costs can be documented, the HRA may consider a reduction in the price of the lot in an amount equal to 75 percent of the cost of sound attenuation measures up to a maximum of $7,500. 9. tf a variance is required to construct the proposed development, the HRA may, at its sole discretion, choo�e to reject the application. 10. If the HRA accepts an application that needs a variance(s), sale of the property will be contingent upon the applicant obtaining the necessary variance(s). The Applicant is responsible for applying for the variance(s)at its own expense. The HRA, as owner of the property, will, however, cooperate with the application. B-7 �oizs�.�s cea act2s-z34 E Green Communi�y Concepts Priority wili be given to projects incorporating the green community concepts listed below. Any concepts the applicant would like considered during the application process should be explained in a written plan submitted with the application. A$5,000 rebate will be provided to the Applicant for projects that obtain certification through LEED for Homes, Minnesota GreenStar or Minnesota Green Communities. 1. Protect and conserve water and soil. To reduce water consumption, consider the use of water- conserving appliances, fixtures, and landscaping. Steps should be taken to minimize the loss of soil and sediment during construction and occupancy to reduce storm-water sediment and air pollution. 2. Minimize energy consumption. Reduce energy consumption by taking advantage of natural heating, cooling and day lighting, and by using energy-efficient appliances, equipment and lighting. 3. Enhance indoor environmental quality. Use non-toxic materials, ventilation and exhaust systems, and moisture control products and systems. 4. Use environmentally-preferable materials and resources. Use locally�produced, salvaged and/or manufactured materials, products with recycled content or from renewable sources, recyclable or reusable materials, and low-VOC-emitting materials. 5. Reduce waste. Reduce and manage wastes generated during the construction process and operation of buildings. if demolition occurs, sort and recycle leftover materials and debris. VII. City Review Procedure 1. Applicant reviews proposed project with HRA staff before plans are finalized. 2. Applicant submits application, plans, and application fee at least 45 days prior to the HRA meeting. 3. An application is considered to be received when delivered personally to HRA staff in a pre- arranged meeting. Following this meeting and upon receipt of the application fee, the lot will be considered reserved and no additional applications will be accepted for the proposed lot while the application is under review. 4. If an application is determined to be incomplete, the applicant will have 30 days to submit a complete application. lf a complete application is not received within 30 days, the application will be rejected and the lot will be made available for new applications. 5. HRA staff review application to ensure conformance with House Design and Site Development Requirements. 5. HRA staff may reject or accept an application at its sole discretion. 7. The Builder or Buyer executes a Contract for Private Redevelopment. 8. An application is determined to be complete and the Contract executed at least three weeks prior to the HRA meeting. 9. HRA staff publishes a legal notice of the public hearing and prepares a report and recommendation for the HRA. 10. HRA reviews application, conducts a public hearing, and takes action at the HRA meeting. B-8 401253v8 CBIt I2C 125-234 11. If approved, the Contract for Private Redevelopment is executed by the HRA. VIII. Lot Sale to Builder or Buyer 1. Upon approval of the application by the HRA, a closing will be scheduled between the HRA and the Builder or Buyer. 2. 7he HRA will prepare all statements, affidavits, documents, and general release forms required for closing. 3. The Builder applies for a buitding permit prior to closing. The Builder is responsible for acquiring the necessary building permits with the City of Richfield Building Inspections Division. If changes to the plans are required by the Inspections Division, the applicant must notify HRA staff. 4. The Applicant provides evidence to HRA staff that all requirements to proceed with construction, as determined in the Contract for Private Redevelopment, have been met. 5. The HRA conveys the property to the Builder or Buyer by Quit Claim Deed. The site will be sold to the Builder or Buyer at the fair market value as appears on the Lot List. 6. At closing with the Builder, the Builder provides a Letter of Credit or cash escrow for $10,000 to the HRA. 7. At closing with the Buye�, the Buyer signs a mortgage and promissory note for$10,000 in favor of the HRA. 8. Upon completion of the project, the Letter of Credit or cash escrow is released to the Builder or the Buyer's mortgage is released. A Certificate of Completion is executed by the HRA, releasing the obligations of the Contract for Private Redevelopment. IX. Program Marketing Richfield Rediscovered program marketing is entirely at the discretion of the HRA. It may include the following: 1. Buyer Solicitation. The HRA may market the program to potential Buyers through promotional articles, direct mail, the Intemet, or other methods as deemed appropriate. Buyers may be any financially capable individuaf or household, including first-time buyers, move-up buyers or empty- nesters. 2. Public Promotion. a. The HRA will periodically provide information about the program through articles in city publications, on the City's web site, on the Community Cable channel, or via press releases to promote community awareness. b. A public open house may be held to provide an opportunity for residents and other interested parties to collectively view the finished homes. The Parade of Home§ Fall Showcase and Spring Preview may also accomplish this. A program information package will be mailed to all interested participants. The information packet may include the following: 1. Lot List 2. Richfield Rediscovered Lot Sale Procedural Guidelines 3. Application Form 4. Sample Contract for Private Redevelopment Xo llata Yrivacy All information secured through the program is subject to the Data Privacy Act. B-9 401253v8 CI3R RC125-234 EXHIBIT C QUIT CLAIM DEED STATE DEED TAX DUE HEREON: $ Date: FOR VALUABLE CONSIDERATION, Housing and Redevelopment Authority in and for the City of Richfield, a public body cor�orate and politic under the laws of the State of Minnesota, Grantor, hereby conveys and quit claims to , a under the laws of the State of , Grantee, real property in Hennepin County, Minnesota, described as follows: , according to the map or plat thereof on f le or of record in the office of the Hennepin County Recorder. This deed is subject to that certain Contract for Private Development between Grantor and Grantee, dated �, 20` (the "Contract"), recorded _, 20_, in the office of the Hennepin County ItecorderlRegistrar of Titles as Document No. The Conh•act provides that the Grantee's rights and interest in the real property described above are subject to the Grantor's right to re-enter and revest in Grantor title to the Property under conditions specified therein, including but not limited to termination of the Grantor's right to re-enter and revest upon issuance of a Certificate of Completion as defined in the Agreement. (if more space is needed, continue on back) together with all hereditaments and appurtenances. �The Seller certifies that the seller does not know of any wells on the described real property. ❑A well disclosure certificate accompanies this document. ❑I ain fanliliar with the property described in this instrunient and I certify that the status and i�umber of wells on the described real property have not changed since the last previously filed well disclosure certificate. HOUSING AND REDEV�LOPMENTAUTHORITY IN AND FOR THE CITY OF RICHFIELD Af.fix Deed Tax Stamp Here By _ Its Chairperson By Its Executive Director 401253v8 CBR RC125-234 C-1 STATE OF MINNESOTA } ss. COUNTY OF HENNEPIN The foregoing was acknowledged before me this day of , 20_, by , the Chairperson of the Housing and Redevelopment Authority in and for the City of Richfield, a public body corporate and politic under the laws of Minnesota, on behalf of the corporation, Grantor. NOTARIAL STAMP OR SEAL(OR OTHER TITLE OR RAK) SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT STATE OF MINNESOTA ss. COUNTY OF HENNEPIN The foregoing was acknowledged before me this day of , 20_, by , the Executive Director, of Housing and Redevelopment Authority in and for the City of Richfield, a public body corporate and politic under the laws of the State of Minnesota, on behalf of the corporation, Grantor. SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT NOTARIAL STAMP OR SEAL(OR OTHER TITLE OR RAK) Check here if part or all of the land is Registered(Torrens)❑ Tax Statements for the real property described in this instrument should be sent to (include name and address of Grantee): This instrument drafted by: Kennedy& Graven, Chartered 470 U.S. Bank Plaza 200 South Sixth Street Mimieapolis, MN 55402 401253�-8 CBR RC125-234 C-2 EXHIBIT D WELL DISCLOSURE ❑ The Seller certifies that the seller does not know of any welis on the described real property. ❑ A well disclosure certificate accompanies this document. [form attached] X The status and number of wells on the described real property have not changed since the last previously filed well disclosure certificate. D-1 401253v8 CL3R RC125-234 Iwiinneswa Departecrnt of Healch M 1 N N E S 0 T A weu AtaQagemenr sectioi, � P.O.Bmt 61975 St.Pau1 Minnesota 55164-U97� 651-241-4�87 a$00-3B3-98Q8 0� x�cK•.ieeulth.sta�e_�rer.uskliss.!eh ise�ls V4'ELL DISC'LOSLRE ST'aTE?!IE`I' Prior ta signing an a�e2enieut to se21 ar transfer seal prcxpei�=.the seller�mist aIR-a�-s cliselose iu ttrituze(«-ell diselosure stateiuent)tUe lc►eatiou aad stattzs(�rell status defined helo�r)oi all�cells on the property ta the buyer. alon�«-itU the legal description ai�d coui�ty of die property.and a sketclt niap sho�•u��thz loeatian af�ach tvell or i�idicate there are no ecells oi�the prop�rty. V�'ELL DISCLOSLTRE C`ERTIFICATE A��fell Disclosm•e Cer•tificate is requii�d to Ue f�ieel��uen t6ere are F�-ells on the pi•ope►��. • �t the tnrx�af clvsing.the.�-e11 disclos�ue stat�aiient infonnation.along 1i•ith tl��pmperty bu}er's nawz aud inailu��address.inust be prazided un a�L'ell�isclosure Certificate(t�'DC)fonn.��Then recordin�a deed or other iustniuient of con�c:v�anc�requiring a Certificate of Real Estate�'alue(C'R��.a coiu�leted T�4'DC'i»usfi be filed gz-itlt the county ncorder.incluciiue a S�4 fee�yable to the ccxint�r recorck-�•. ' • ff there is a pree-iausly filed a�?C and tbe�nuuber of�e-ells and or the t�-ell status has changzcl a ne�z'ti�'r3C`niusi be&led.Y�x may seamh for pre`iausly fileci 1VDCs at: it�►«v.health.state.mn,rcrldivsteh�i��ellsfilrsclosttres/disclaimer•.h tml. • If tlie ninnber aud status of u•ells on the grope�ty�na�n wichaneed since the p»riously filed�VDC'.a statement inust be placed an the deed ar other instntnient of cant-ey*ance that reads "I am fnnaiTi�r►•i�zth tire��m�c:►�� descy�barl in this insf�zt�ererrt attd I cei�ttfi�tler�t the stetrrs mKl ntnnbcc•r of irefts on the de;se�zbe.cl 1�eet1 pr aper��{rm�e �fot changed si�rce rhe lc�sr pre►�ia�sh�fitecl iti ell disclosure ce.r�tifrcnte."This statement mtist t�e certified b}r the �ryer or seller and no��'DC is required. If them sre uo ssells on tl�e propert}•,A R'ett Desrlosure CerfificAte is not required to be fited.Ho��-e�c-�•,the Seller must certify a stat�nent on the deed ar other uistnunent of con�-eyanc�that i�eads "The.S�ller•rerti�es tlrat the Se1Jer does iiot kno�t�of r�ril'iti•eTls on the clesri�be�r�d pro��h�." L�STRL�CTID`S FOR CO�IPLETI\G THE �'4'ELL DISCLOSL�RE CERrIFIt:�TE A�'��fee must i�inehideci«�I�en u�t�iiiittu�g tl�is fon�i tu tlie count�•�YCOrclzr's office.7he fee is to i�z�aid b}'tl�e bii}•er or perz�u filing the cked.Please uiakz die check payable ta the Caunty Recorder.A cog}ot this�VDC shoi�ld be prc�a'ided to the pr��tt>btiyer at the tiiue of closing. PROPERTY.BLZ'ER,�\�SELLER I\FORIIATIO\ A. FROPERIY LOCATIO\LEG�iL DESCRIPTIO\-Proiick die count}r uame:'ttnplatted°a metes and �?GHtlltl5 t�24�t'I�:l[IOII(d]11A1"IIIZ[rnie qtk�rter sectiati is required]t�S'g[?�'C'IYllll2I1L 10�. 52�h011.[t111-1]SI71�.1.�11{�T4l1lgZ uinuberj:and ar••�latted'"(lot ntuu�r and oi-Ulock nuuilxr.and ad��itinia nante}:graperi}�street addres�(ii applic�abie�.and city(this is the pin�sical location.�f tl�e progert;��not die m�iluig address):prapzm-ID ntuuber ar pat�cel utunber(t�tio�t��l).Attacl�a�om}�lete teQal de4crigtivu af tiie gro��ty. B. PROPERT�'BLYER�i_�IILI�G�DDRESS AFTER CLOSI:�G-Pr��s-icie tlie bu}er�s hGll na�me(or C011113811�'IYfi1112 It bilyZf IS�C0111�.�811�'}.�111]3fICL'2Si.:111C1�l�101iZ i1ill11U21'�I17CIllt�lll�:iC2A COL�2,k..BZ StU`2�c�lll��tl�2� <i CO111�1I�i�Ill�illitl��lYSS.If tI12 131'��jl�T1)'li jt1141tI�'��1�'ll2�.i)1'U�"1(�2 TI72 Yl�lllZ 9ri(1 COIll�Jl�&2 111�i1�ll1U ACIC�I'2i4 tlt f�l�C011taCt 1K1'iOA. t Seller's\azne—Please p��it3e di�nauie of the��ller ui�pace pi�,�-ideci{ple�se print:�. D-2 401253v8 CBR RC125-234 C'. CERTIFICATIOi�BY SEL.LER-Ihe seller(ar clzsiguated ic�reseutati�ej 3hould sign this certificate befoi•e it is iulmiittecl to tlye caunty rzcorder's nffice. If the seiler is�uiable to sip�tlie dociuuent.thz b�ryer(or designa�ted rzgres�ntatice}�aui}*si�st the certificate befrn•e it is subuiitted to the counry recorder's o�ce, D. CERTIFICAI`IU�SY BLYER-If the seller is unable ta sign the dvciunei�t.tlie huyer�or desiguated represeruatis e)may sign the certificate beforz it is subiuitted to the caunty recorder's affice.�'here cleeds are �izen in fi�lfillinent of a Contracf for Deed tl�e ST�FDC'mast be siguecl by the ba�-er ar the person autharized tv a�t orF behalf of the bu}er. Signature Requu•ed-Tlicre�nust be at least rnie sipiature ou the ceilifieat�. �\"ELL I!��'OR1iATi01 E. «�LL LOC"A'I'Idti LEGAL DESCIZIFITON-For eacb n•ell being dfscMsrd the follo�4•ut�pllvsical lotaticnn infannari�z is requ'ued: • co+uxty nauie.quartile(oi�e qi►artet szctian is requiredj. section.tm�-uslup.aud range mrmber.and'or � ca�uaty name.gozen�nevt lat.seetiou.ta�t-nship.and ran�e ntunber.andpor • county uame.lc�t n«ailxr aud or block uiuyiber.a�nd addition nanie �ti�ELL S7'A7L"S Ii��'C}R�1IAI�10:�-Inclirate die status of e�+cli��•ell. CLerk onl�•oue box. In L:se-A�<<ell is"in use"if the ii-zll is�perated on a daily.re�ular.or seascxial basis.r��ell"in tise°inchuies a tcetl that aperates for the p�upose af irrieaticx�. firz proteetion ar e�nergency pumpine. '�ot In L'se-A t�-e11 is"not iui usz"if the�rell does nat meer the definitian of"in use"aho�•e and has iic�t h�en sealeci by a ticensed ti�•ell contractat. � If the t�-etl is"not in use."is there a Mitu2esota De�ueut af Health�IaiDH j z ariauc�f�+r tlus t�-e11?Pleasz }xo�:ide the zariance tracking nmuhc-��(TT j.iflcno��n. • If the�t-ell is"not in use."is there an MDH maiuteuance�xmut for this n•e1D^Please gro`-itle t}�e pennit nfutibea. if laine�•n. Sealed-A�•ell is°s�aled"if a licensed i�ell contractar t�as couipl�tely filled a«•ell by*pmuping gro�it material tivmigho►�t the entire��-e11 after re��o�•al of any obstneetions fiom the�i•ell,A t�t'�ll and Boriug Sealing Recald must bt on file n°ith the MDfi.Contact the D4DH to s-eriip if a sealing record is on file.A��ell is"cap�d"if ii li»s a meial or plastic cap or corer tiz°hich is threaded,bolted ar ie-elded auto the top of the��ell to gre�ei�t enuz into the��-ell. a Kcapped"ire}I is not a"sealed"�-eil. Importanl\�`ell Status Infor�narion: � The?tiDH ti�-ill folloR--up�-ith the property buyer»aa�Ylitt�au}E�'ells dis�lc�sed as'Yiot in use."If a��-ell i�"not v�nse."the prope�-o�ruer�uust either mt�un the�t•ell to"iu use."l�are the i��ell°sealzd"b}a lie�ised��-ell coniraeiar.o�r abtani an a�mual ivaintenai�re peiYnit finui the AiDH for�1?S. • I�.3an�t�a�auce�xnuits are not tr�snsferaUle.If a t�-ell is"iu tise."a maintenauce peniiit is uat reqitired. • If tlie��-ell has be�i"sealed"by soiiieone ot�er than a lic�nsed��•ell conh�►etor Qr a licensed t�•ell se9ling couri�ctflr. check the�cell status as'�not in use." �ldditional«'ell Information-R�ti-ide the follo`t-u7g iufiorni�tioii.if Icnoe�°u: hiinuesdta Unique�LTell Nun�ber or Sealuig Reeard Nruizl�r.ti��te af it-ell eaustniciivn ar s.ealing.aud nuiie uf lieensed trell coiin:�ctor. SI�ETCH�IAP-C°c��iWlete t3ie zketeh map as i�utnieted ou die`'�'DC. The lc�cation uf eaeh�cell uiust be u7die�ted. If t}xe laeation of a��-ell is not laiotcn.laa�-e tlie�E-ell l�ated by a persou qik�lified to Ic�cate�cells. seich zs 7 lilc-7izeci tt•ell coi3trnctor. lf��t,u lia�•e questi�,us.g�tea:e c�+irt�ict the:�iDH�T�'ell 3�ia�iaQC�uent Section at 651-=U1--3�5?or Sttll-;S�-95t}5. T��reque�.t 41us docwnc�id m anodier fonuat,call C�i-_O1-�titkk. D�af aud ha��3-or-lie�ru�g: T7'I'65]-_'G1-*-!?-. �'i�it the�iDH��'�li'yianaaeau��tt S�ctiou.��'e11 Diieloiiu�e Prc�graix3�+cebsite ar. u��t•.hPnitl�.state.n�r�.usi�lil s/eli,nre�tls/disrlostri•es. D-3 40I253v8 Ci3R RC125-234 COLLVTI"L?SE O\ZT �IIIH[?SE O�Zl �iI'�1ESOT.�1 DEP�IRI'lIE.�T OF HE.#LTA �l'eU bf.inag,tment Satiaa P-�.Box 64975.St_Pa[rl.6Lnnesota>316i-0975 551-201�4587 or 800-383-9�I� ��'ELL DISCLOSL'RE CERI'IFICATE PLF.dSE 7YPE OR PRI.'NTAIZ Pa�ORIL�TIOs'a� Person filin cteed must include a S50 fee able to the c recmrder. .�, PROPERTY LOCATICJ��LEGAL DESCRIPTIO� AHach a legal�iescripiion of khe property. Camty S�ction No. ToRnship No. Rmige No. (piatter(or C►m-er�ucietd Lot) Hennepin Lot Na(s). $lock No. AdJition Naane Uu1cx Tsact Prapeily Strees Adckess CitylTo�ship 7IP C«!e Prc�peitS ID No.Psrrel No.(c�puonai) Richfield 55423 B. PROPERTY BL?YER�iAILL\G ADDRESS AFTER CZOSL�G Fu41 Name Middle 7nitiat I.ase 1�Iame ComQaay Name(if apPlicablr) Mailing Addcess Mailu►g Address City State%Prmv�ce ZIP Code Telepl�one I�1o.(inchu4e�g area ccxk) ��afa�t�r(��m� Housing and Redevelapment Authority'tn and far�e Gity of Richfield C. C'ERTIFTCaTIO\BY SELLER I certify that the mformalson pro�idecl�this certificate is acctuate and coe�►kte ao the best of m7;l�oa-ledge. Signature of Se11er o�Designatecl Representah�•e of Seller I�ae D. CERTIFICATIO\BY BI'YER For fulfellment of a conirnct for cieed..the Uu}�er or penon authonzed to act on behaif afthe Lx�}eT_must sig�i a�ie11 Diselosure Gertificate if Uiere is a w�ell on the praperty_ In the absence of a seller's sigpature,the�iuyer,or person authorized to aM on b€half of the bu_yer n�ay sigp this�Vell Disclosiue Certificate�No signafure is rec}�ured by the b�t}�er if ttie seller t�as si�ned abo�r. Based on diselasure u►formation pm��ided to me b}'the seller ar oWer a�•a�lable infrmruetic�,I certifS°that the nifomiahc�n on ihis certificate is accivat�and eomplete to the besi of m}�knou ledge, Signature of Buyrr u Desygn�ted Repre�seiitatic-e of Bu4�cr Date I\iPORTA\T 1�TE: Ttie Minnesota De}aarnnent ef Health(MDI��ill follot��-�tp u�th the prope�tS=bu�'er regarduag ang a��e1Ls disclosed as nut m use.If a�a•ell is uot in use,the pro�t}-ota�er must either r�nun the�-e(1 to nse.hat=e the �•eil sealed b�•a licensed n eli coutractor,or obtain an annual u�au►t�nanc�pennit fra�i the b7DH for S 1?S.A eop�-nf t3ns �Vell Disclos►tt�Certificate should be prottided to the prvpert}°bin'ea�at the time c�ff closing. D-4 401253v8 CBR RC125-234 r �II\:\ESaTA DEPAR.T:�lE\�°OF HF�IL�I ��cate Total Nwuber of �VELL DISCLUSL'RE CERITFICATE Wells on Propett}� a PLERSE TYPE OR PRINl'ALL LYFORMRTIOsY Fi11 out a separate«�e1J iiifc�rn�ation gage if inore tb�t t�o�•ells�re lc�cated an the prapenv. E. �VELL LOCATIO\LEGpL DESCRIPTIO� �VELL#I—If fhe prvperty legal description ba.s mcxe tl�cuse srcti�,tan�uhip,cu ra�e min�ber;quarter(or gvt-rnmsent Iot):ot k+t ar black munber; ide ific al 'on infosmation re da� 1he �sscal krcatian of ttris well. CattAy Secti�nn No. Towustrip No. R�e No. (��ates(ox Cnnemmeut Lot) Hennepin I.at No. Black No. Adclitiou Name O+uctot 'lract MN Lhticp�e R'ell No.or Sealing Reccxd No. R'ELL STA7T"S(C'►eeck or,iy one box) I7ate af Well Consauction or R`EI.L IS: ❑ In Use(1) ❑Not sn IIse(Z) ❑ Sealed bq Liceusecl Wefl Cumu�cir(3}`' Sealmg `CaA�IDH ts cr�w�reewd is ow�r. x�Qf��a v�T�n c«�� Itttu aceii has been seakc[by sameoeie ott�er tHao a Iicrosed weU canuactar or a 6eensed veell seaiing coWranor.check tke arJl sta�tus as not in use_ �tso see°II+�ORTriNT h'�0�3E°vn 1 If w�efl is t�at in nse,is fhere am tMDH o�iance for Ytris aveil? If fl�c v�eli is uoa in usr.is tbete an MD'I�i maime�nce pemgt for ❑ Yes ❑ No ttris aeSl? ❑ Yes ❑ I�3o If yes.pronide tLe��aziance oracking au�er(1� IfMes,prvtzde ihe pernat a�ttnbet �VELL#2—If the PraP�Y��Ption has rnore than aue s+ecli�ta towasirip,or ran�e unmlrer;y»tec(or gac�enl bt);or lot or blark aumber; m�ide c desai in5osmation r c4a dre - kscation of this w�ll Cam1y Section No. Towics#iip No. R��e No. Quuter(or Go�nettunent Lot) Lot No. BIocL-No_ Ackiiaon Name Artlot Taaict h+tl`LTnique Ne11 No.or Seatmg Reccxd No_ RELL S7'.�ITC S(Check cm[y o�e bmc) D�te of Well Caristiuctiar or tt�EI.L LS: ❑ In Use{1) ❑ Not in Use{2) ❑ Sealed by Lieensed Well Co�ttcactoc(3}° �fm� "Caii�1DH oo�-erif�seali�record is ew Hr. Nawe of Iiceraed V�'el!Confractoz If the�em Las been sea3ed b�so�e other th�a ficensed iarll caattrxto�oc a ficeased well9e�t�g c�tcacta�,check the Rrll stah�s as not in use_ �iso see"IINPOATANT IQ07E'�on 1_ If rsell is not in nse,is there aa MDA�ariwce for tlns well? fftt�well is aot in use,is There an MDH marntenance penrrit f� ❑ Yes ❑ No lhis�s�eEt? ❑ Yes ❑ No If yes.�xo�ide tLe caciar►re tiacking saunber(TN) If}�es.prmicie the permit sr�xube[ SKETCIi�i.-iP—S'ketrh the location of ihe well{s}aod inch�de estimated distaaces fr�zoads.s�teets,and buildings.If u�urn tLaa nue��ell a��opert}•,use the�t-eIl tocatiou nnmber ahn�•e to idenfih•each ue11 The location of the u�ell(s)must be Ixozided.If the location of a�vell is not knoa�n,hare the Well located by a person cp�alified to locate a�ells,svch as a Iicensed n�ell c�uactoe. jnfonssation grolYded on this foau�is classifiect as public uiforuzarirna inider'A�Sumesnta S�hrtes,Chapter 13. To request dus dnamiecit ui another frnmat,call 651-201-�#600.De�f and hard-of-4xartng: TT� t�41-?Ol 5797. 4'is�c the MDH R'ell hlanageuieut�ection.R'ell Disclostue Prc*gratn►t�rbsite ar tisul+.hmfii7.slate.natras iliis:c:li i�elfs tliser'osurAS. HE-01�87-1? ICR 1-1U-C�38� orig>ocell di�las�ue rertiGca�e-instn�ctioas i''1 �11R D-5 401253v8 CBR RC125-234 7229 1StAvenue South (Constructed by Endres Custom Homes, Inc. in 2013) � ��y�� - ..,� �' >, . .� > � �� .:� �, A,, � f;; ,' �:�-�`�` '�., ' S �� ; � �, ,, `; , � ' . � � �. , 4j � � ' ' �'�`� � 'r �?, � �,� a �° � .�.,, _�:, . < � � �- a �. ,�� ` ��.�°r`'� � � — - j r,`��,- _ . :� _�- / � �� s � `� � `�� -- '"; — -- � �� -— _ �` � _ 4 . ' � �—�-;�; ■.. `'_-_ � _- � Fg� ��,,�. ----�'.+�-�+—_ —_ 'ii.�' _ _ _—_� � �r . _, � I� � �j�j�� ' _�� li' �� -�..• � t � � -�f; �� }- -n';., -�"` ,� ; ::".,. �.., . .,�� `� �'� � — .r'�' '�� ..� — . ; :, 6��,,,'�} �"�s� ::,,r�. �.� *�, � � ' ,: ;'• � �;. +' �#L ir,�E::�a � l y J. p.��3 F1t'•r Ys,' ~ �y.�,Cy!ty..§��A.+f * .4'�'�'rs �-�.C"`�T�S '�-�"�. ♦ .J f� Wa I -r 5-,,.� ��F`�'�: ..�� a ♦ ..• �t�x: T' 4s,, ��Zlu�nr�4� i�;. •��A ....Fk�4 �� L. �.�.i, i.?:� j_ . � .- � ,��` „ a r g �%..,� �.° �,i1' '":�r'"y� �°'Wi►'"�-��'�"'.��: r` t�� i � +. w; + �y 'i'k��ic A .'��'"f �i"'�. „f.i.y . .�w y`,. ,7. �,'if',�A 1F-��'...)�� 4 "'i.a,�� -�9��'�s��"� �� *��r y 4 �f x`i�i �� M� :��:a��Vti Ci_%,t�' /..^.�Et� ' . . !FL'�F ..�y ^Y�'... �`f.'. 1 . AGENDA ITEM#: 5 REPORT#: 3� STAFF REPORT �r► � ' ''` HOUSING AND REDEVELOPMENT AUTHORITY MEETING AUGUST 18, 2014 REPORT PREPARED BY: KATE AITCHISON, HOUSING SPECIALIST N,9,tirr,TiT�E REPORT PRESENTER: JOHN STARK, COMMUNITY DEVELOPMENT D�cTOR NAME, LE ACTING DEPARTMENT DIlZECTOR � REVIEW: - � GN 7'URE REVIEWED BY EXECUTIVE DIRECTOR: �'� _ ITEM FOR HRA CONSIDERATION: Consideration of a settlement of a Housing and Redevelopment Authority Deferred Loan at 7228 Aldrich Avenue. I. RECOMMENDED ACTION: By Motion: Approve or deny a proposal made by the owner of 7228 Aldrich Avenue for a settlement of a $10,345 Deferred Loan in the amount of $1,000.00. II. EXECUTIVE SUMMARY In 1994 Thomas Burgess, owner of 7228 Aldrich Avenue (Homeowner), received a Deferred Loan for $10,345.13 to make improvements to his family's home. The loan carries a 30-year term with no interests and no payments, and is due to be forgiven February 2, 2024. Due to financial and personal reasons, the Homeowner is attempting to sell the property to avoid foreclosure. The first mortgage balance is $158, 674.28. Mr. Burgess has received an offer to purchase the property for $140,000. After satisfying the first mortgage, paying fees, commissions and closing costs, Mr. Burgess is unable to repay all his debts. He is therefore requesting a settlement of the Deferred Loan in the amount of $1,000. 08182014 Loan Settlement Request 7228 Aldrich.docx III. BASIS OF RECOMMENDATION A. BACKGROUND • In 1994 the Homeowner received a Deferred Loan in the amount of $10,345 in order to make necessary repairs to his home. • The loan is deferred with no payments or interest, and is forgiven after 30 years. If the property is sold or transferred within the 30 year period, the loan becomes due and payable. • The loan is due to be forgiven on February 2, 2024. • He has received an offer of$140,000 on the property after originally � listing it for$220,000 in 2012. • The current Hennepin County Estimated Market Value is $159,000. • After paying off the first mortgage, fees and commissions, and closing costs the settlement leaves the homeowner unable to wholly repay the HRA's Deferred Loan. .....................................................................................................:......................................................................................... ..................................................... ....................:.................................................................................... Debt ! Amount Proposed ' Settlement � ; ; , ; ` Owed i Settlement : Ratio � :..................................... ................................................................................................................................_,.........................�............................._......... ;..............................��.,�..............o.......; � First Mort a e US Bank 158, 674.28 ; $121,607 ; 76.6/0 .............................................� �.........�.. .. .................. .�...........................;............�... . . . ;..._Deferred..._Loan...._(H_RA.�.................................................................:.......................$_1_0,345.�..�._3.....�......... _$_1,000.a. 9.7%.; Settlement Char es :....................$.1..1..,493.00 ; $.1..1..,493.00....;......................................................._1._00%......; }. ..............................................................................�......................................................................................; ,................... o ; Taxes, Assessments, HAFA ; $5,900.00 : $5,900.00 ; 100/o ; : ; relocation assistance . ' ' * i _..................................................................................................................................................................................._�........_................_.............._....................................._._�.........................................._.......................................;.................................._...................................._................� ' TOTAL .........................................._;............_$....1..86.,41..2..4_1.......:............................._$140,000.....:................................................_75..1.%.; ........................ * Home Affordable Foreclosure Assistance (HAFA) is a governmental foreclosure program that provides borrower relocation assistance (moving expenses). It only applies to qualifying borrowers. Mr. Burgess'type of mortgage makes him eligible. B. POLICY • The Deferred Loan Program provides loans to Homeowners earning less than 80 percent of the Twin Cities Area Median Income (AMI) to make repairs and improvements that address health, safety and/or property maintenance items. • The Deferred Loan Program is funded with federal Community Development Block Grant (CDBG) funds. There is no federal requirement that the money be repaid. • The Mortgage Foreclosure Response Program Procedural Guidelines state as follows: "Staff will consider short sale offers and negotiate as high of repayment as possible. Action will be taken quickly so as to not disrupt the short sale opportunity and cause the homeowner to enter into foreclosure." • The entire loan amount is normally due and payable if the property is sold within the 30-year period, regardless of the number of years remaining on the loan. C. CRITICAL TIMING ISSUES • The purchase agreement requires the Homeowner to receive short sale approvals by September 1, 2014. • If the HRA and the Homeowners cannot reach an agreement regarding the payoff of the HRA mortgage, the Homeowner is in danger of defaulting on the principal mortgage and being foreclosed upon. D. FINANCIAL • Any repaid funds would be returned to the Deferred Loan Program. • The attached letter from the Homeowner describes the financial and personal difficulties he has encountered that have led to the need to sell the home. • The HRA has a subordinated position to the primary lender. If the property is foreclosed by the lender, the HRA would likely receive nothing. • The Attorney for the Homeowner requested that $6,000 be repaid to the HRA; however, the bank would authorize no more than $1,000. As senior lienholder, the bank is under no obligation to approve any repayment to the HRA. • Neighborhoods in which there are one or more foreclosed and vacant homes have detrimental impacts on the surrounding property values. • The loan was funded with CDBG funds. The HRA established the requirement that a borrower must repay the loan at the sale of the property. There is no federal requirement to repay the funds. • The HRA has received seven requests for a short sale settlement in the past two years. The HRA agreed to the following settlements: o $2,500 out of$25,000 (10%) o $1,000 out of$1,577 (63%) o $0 out of$8,249.95 (0%) o $2,600 out of$26,000 (10%) o $5,040 out of$10,080 (50%) o $26,094.28 out of$30,000 (87%) o $2,384 out of$15,892.34 (15%) E. LEGAL • Legal counsel has confirmed the HRA's authorization under a short sale. • The HRA has the authority to negotiate a settlement or forgive the loan. • The Deferred Loan Program is funded with federal Community Development Block Grant (CDBG) funds. There is no federal requirement that the money be repaid. IV. ALTERNATIVE RECOMMENDATION�S • Deny the proposed settlement; however, the property will then likely go into foreclosure and the HRA will receive no funds. V. ATTACHMENTS • Letter from Thomas Burgess, Homeowner • MLS Listing History of 7228 Aldrich Avenue VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Aklilu Dunlap, Attorney for Tom Burgess � August 6,2014 Julie Urban,Housing Specialist City of Richfield 67U0 Partland Ave S Richfield,MN 55423 RE:Thomas Michael Burgess 7228 Aldrich Ave.S. Richfield,MN 55423 , Dear Sir,Dear Madame, I write to ask the City of Richfield Housing and Redevelopment Department for release of my obligation to repay the full balance of the home rehabilitation loan in the event I resell before thirly years of occupancy. I have lived in the property since 1978;however,I need to sell my . property because I can no longer afford to live there due to the hardship of a divorce,excessive • debt,and retirement(fixed social security income). P(ease release the(ien and waive the deficiency so tha.t I can close the short sale of my home. After several decades of marriage,my wife and i fmalized a divorce proceeding in 2009.My wife moved out,and I alane am responsible for the home under the divorce decree.In the course of the divorce we were forced to support two households and assume thousands of dollars in attorney's fees and legal costs in addition to our existing consumer debt. As a retired person living on a fixed income,I can no longer meet my debt obligations though I have struggled hard to do so. It has been my life-long policy to honor my debts,but I simply cannot do that under the current conditions. Accordingly,I am taking measures to preserve the home and market it in hopes of obtaining the best offer possible so that the lenders will settle for less than the full repayment and waive their respective deficiency rights. Should you have questions or additional requests,please direct all communication to my attorney,Aklilu Dunlap.His number is below. T'hank you. Borrower's Signature: i� .,,: • Date:August �2014 Thomas M.Burgess NorthstarMLS Matrix � ,�� r �� h1�p�a ix.�ertiistacrn�eenj/�+Ia�r•i�biizfHi�yP�'Q opP up.aspx?ii... � t�.� �--isfi,'`� �' [ cx MLS# Street Address Municipality Field Date Stamp Old Value New Value Property Type 1 �4178403 7228 Aldrich Ave 5 Richfield Status 8/2/2012 12:36 PM INCOM ACT Sinqle Familv 2 �4178403 7228 Aldrich Ave S - Richfield ListPrice 8/2/2012 12:36 PM $22,ODO,OOOSi�gle Family 3 �4178403 7228 A(dricfi Ave 5 Richf(e!d ListPr(ce 8/2/2012 1:16 PM $22,000,000 $220,000 Single Family 4 �4178403 7228 Aldrich Ave S Richfield ListPrice 9/7/2012 12:46 PM $220,000 $212,000 Single Family 5 �4178403 7228 Aldrich Ave 5 Richfield ListPrice 9/28/2012 9:15 PM $212,000 $204,000 Single Family . 6 �4175403 7228 Aldrich Ave S Richfield ListPrice 10/li/2012 10:15 AM $204,000 $199,000 Single Family 7 �4178403 7228 Aldrich Ave S Richfield Status 12/18J2012 10:55 AM ACT CANCL Single Family 8 �4344813 7228 Aldrich Ave S Richfield Status 3/14/2013 5:15 PM INCOM ACT Single Family 9 �4344813 7228 Aidrich Ave S Richfield ListPrice 3/14/2013 5:15 PM $199,000 Single Family SO �4344813 7228 Aldrich Ave S Richfield ListPrice 4/29/2013 9:16 AM $199,000 $194,900 Single Family 11 �4344813 7228 Aldrich Ave S Richfield ListPrice 5/19/2013 10:05 AM $194,900 $189,900 Singie Family - 12 �4344813 7228 Aldrich Ave S Richfield ListPrice 6/26/2013 11:56 AM $189,900 $179,900 Single Family 13 �4344813 7228 Aldrich Ave S . Richfield ListPrice 7/15/2013 10:45 PM $ll9,900 $174,900 Single Family 14 �4344813 7228 Aldrich Ave S Richfield ListPrice 10/29/2013 9:55 AM $174,900 $165,000 Single Family 15 �4344813 7228 Aldrich Ave S Richfield Status 12/15/2013 12:15 AM ACT EXP Single Family 16 �4435480 7228 Aldrich Ave S Richfield Status 12/15/2013 9:15 AM INCOM ACT Single Family 17 �4435480 7228 Aldrich Ave S Richfield ListPrice 12/15/2013 9:15 AM $165,000 Single Family 18 �4435480 7228 Aldrich Ave S Richfield ListPrice 12/26/2013 10:25 AM $165,000 $160,000 Single Family 19 �4435480 7228 Aldrich Ave S Richfield ListPrice 1/24/2014 6:55 PM $160,000 $155,000 Single Family 20 �4435480 7228 Aldrich Ave S Richfield ListPrice 3/9/2014 12:05 PM $155,000 $150,000 Single Family 21 �4435480 7228 Aldrich Ave S Richfield Status 3/15/2014 12:25 AM ACT EXP Single Family 22 �4456113 7228 Aldrich Ave 5 Richfield Status 3/15/2014 12:15 PM INCOM ACT Single Family 23 �4456113 7228 Aldrich Ave S Richfield ListPrice 3/15/2014 12:15 PM $150,000 Single Famlly 24 �4456113 7228 Aldrich Ave S Richfield Status 6/15/2014 12:15 AM ACf EXP Single Family 25 �4456113 7228 Aldrich Ave S Richfield Contingencv 6/15/2014 12:15 AM C-3RDPA C-NONE Single Family 26 �4344813 7228 Aldrich Ave S Richfield Contingency 10/29/2013 9:47 AM C-3RDPA C-NONE Single Family 27 �4344813 7228 Aldrich Ave S Richfield Contingency 10/9/2013 10:39 AM C-NONE C-3RDPA Single Family 28 �4456113 7228 Aldrich Ave S Richfield Contingency 4/8/2014 2:56 PM C-NONE C-INSPE Single Family 29 Q 4496795 7228 Aldrich Ave S Richfield Status 6/23/2014 9:26 AM INCOM � ACT Single Family 30 Q 4496795 7228 Aldrich Ave S Rtchfield ListPrice 6/23/2014 9:26 AM $150,000 Single Family 31 Q 4496795 7228 Aldrich Ave 5 Richfield Contingency 6/23/2014 9:26 AM C-NONE C-3RDPA Single Family 1 of 1 8/12/2014 9:48 AM AGENDA ITEM#: 6 REPORT#: 32 STAFF REPORT r HOUSING AND REDEVELOPMENT AUTHORITY MEETING AuGUST 18, 2014 REPORT PREPARED BY: CHRIS REGIS, FINANCE MANAGER NAML,TITLE REPORT PRESENTER: CHRIS REGIS,FINANCE MANAGER NAME,TITLL• DEPARTMENT DIRECTOR REVIEW: � SIGNA C E , / � � ,i'�- REVIEWED BY EXECUTIVE DIRECTOR: � ,�� .� ITEM FOR HRA CONSIDERATION: Consideration of resolutions approving proposed property tax levy for payable 2015 for certification to Hennepin County. I. RECOMMENDED ACTION: By Motion: Adopt the attached resolutions approving the 2015 Proposed Housing and Redevelopment Authority Budget and Tax Levy and 2014 Revised Housing and Redevelopment Authority Bud et. II. EXECUTIVE SUMMARY The bylaws of the Richfield Housing and Redevelopment Authority (HRA) require that an annual budget be submitted to the HRA Commissioners for approval. Accordingly, the 2015 Proposed Budget and Tax Levy and 2014 Revised Budget are presented for approval. In addition, Minnesota State Statutes require adoption of a preliminary tax levy from each taxing authority. The proposed tax levy must be certified to the Hennepin County Auditor by September 15, 2014. Any amendments to the proposed budget, which would increase the property tax levy, must be made prior to September 15, 2014. No increases in the tax levy are permissible after that date, only reductions. Final certification of the HRA tax levy is part of the City's budget process. The tax levy as proposed is the maximum levy established by law and represents a .66% decrease from the previous year's levy. III. BASIS OF RECOMMENDATION A. BACKGROUND • N/A B. POLICY • Minnesota Statutes require adoption of a preliminary levy from each taxing authority. • The budget and accompanying proposed levy for 2015 are ready for consideration. • Even though a public hearing for the HRA tax levy is not required by State Statute, this does not preclude the HRA from opening this item up for public discussion if the HRA desires to do so. C. CRITICAL TIMING ISSUES • As required by State Statutes, each taxing authority must certify its proposed tax levy for the payable year 2015 to the County Auditor on or before September 15, 2014. D. FINANCIAL . The Proposed 2015 HRA levy represents a .66% decrease from the previous year's levy. • The levy as proposed is for the maximum levy established by law of the .0185% of the City's total taxable market value net of the market value exclusion. E. LEGAL • N/A IV. ALTERNATNE RECOMMENDATION(S� . The HRA could adopt a preliminary levy less than the one proposed herein. However, that would not provide for programs that are recommended in the 2015 Proposed/2014 Revised budget. V. ATTACHMENTS . Resolution Approving Proposed 2015 Housing and Redevelopment Authority Budget and Certifying the 2015 Tax Levy . Resolution Authorizing Revision of the 2014 Budget of the Housing and Redevelopment Authority of Richfield VI. PRINCIPAL PARTIES EXPECTED AT MEETING . N/A HRA RESOLUTION NO. RESOLUTION APPROVING PROPOSED 2015 HOUSING AND REDEVELOPMENT AUTHORITY BUDGET AND CERTIFYING THE 2015 TAX LEVY BE IT RESOLVED by the Housing and Redevelopment Authority of the City of Richfield, Minnesota as follows: Section 1. The budget for the Housing and Redevelopment Authority General Fund of Richfield for the year 2015 in the amount of $478,160 is hereby ratified. Section 2. The estimated gross revenue of the Housing and Redevelopment Authority General Fund of Richfield from all sources, including general ad valorem tax levies as hereinafter set forth for the year , 2015, and as the same are more fully detailed in the Executive Director's official copy of the budget for the year 2015, in the amount of $525,660 is hereby approved. Section 3. There is hereby levied upon all taxable property in the City of Richfield an ad valorem tax in 2014, payable in 2015 for the following purposes: Housing and Redevelopment Authority $468,296 Section 4. A certified copy of this resol.ution shall be transmitted to the County Auditor. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 18th day of August, 2014. Suzanne M. Sandahl, Chair ATTEST: Doris Rubenstein, Secretary HRA RESOLUTION NO. RESOLUTION AUTHORIZING REVISION OF THE 2014 BUDGET OF THE HOUSING AND REDEVELOPMENT AUTHORITY OF RICHFIELD WHEREAS, Resolution No. 1160 appropriated funds for personal services and other expenses and capital outlay for the Housing and Redevelopment Authority for the year 2014, and WHEREAS, The Executive Director has requested a revision of the 2014 budget as detailed in the 2015 budget document. NOW, THEREFORE, BE IT RESOLVED by the.Housing and Redevelopment Authority of Richfield, Minnesota as follows: Section 1. That the 2014 appropriation for the Housing and Redevelopment Authority General Fund is revised as follows: $28,090 decrease Section 2. Estimated 2014 gross revenue of the Housing and Redevelopment Authority General Fund from all sources, as the same is more fully detailed in the Executive Director's official copy of the 2015 budget document, are hereby revised as follows: $90,220 increase Section 3. That the Executive Director bring into effect the provisions of this resolution. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 18th day of August, 2014. Suzanne M. Sandahl, Chair ATTEST: Doris Rubenstein, Secretary