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12-10-02 agendaCITY OF RICHFIELD, MINNESOTA TUESDAY, DECEMBER 10, 2002 ~, SPECIAL CITY COUNCIL WORKSESSION COUNCIL CHAMBERS 6700 PORTLAND AVENUE 5:00 P.M. Call to order Roll call 1. Annual meeting with Richfield's Legislators Adjournment REGULAR CITY COUNCIL MEETING COUNCIL CHAMBERS 6700 PORTLAND AVENUE 6:30 P.M. AGf NDA INTRODUCTORY PROCEEDINGS Call to order Roll call Open Forum (15 minutes maximum) Each speaker is to keep their comment period to three minutes to allow sufficient. time for others. Comments are to be an opportunity to address the Council on items not on the agenda. Individuals who wish to address the Council must have registered prior #o the meeting. Notes: Pledge of Allegiance Approval of minutes of (1) Special Concurrent City Council and HRA Worksession of November 20, 2002; (2) Special City Council Worksession of November 20, 2002; and (3) Regular City Council Meeting of November 26, 2002 PRESENTATIONS 1. Swear-in Richfield Police Officers, Eric Turnquist and Eric Lammle 2. Richfield Foundation awarding of 2003 grants COUNCIL DISCUSSION Notes: AGENDA APPROVAL 3. Council approval of agenda CONSENT CALENDAR 4. Consent Calendar contains several separate items which are acted upon by the City Council in one motion. Once the Consent Calendar has been approved, the individual items and recommended actions have also been approved. No further Council action is necessary.. However, any Council Member may request that an item be removed from the Consent Calendar and placed on the regular agenda for Council discussion and action. All items listed on"the Consent Calendar are recommended'forspproval. A. Consideration of approval of City Manager's reappointment of Connie Murray and Paul Wasko for two-year terms as Hearing Examiners S.R. No. 284 B. Consideration of approval of Condemnation Commissioners' award on Parcel 5, 7601 and 7611 Knox Avenue, at Fountainhead Apartments; 76th Street Widening Project S.R. No. 285 C. Consideration of approval of Stipulation of Settlement for Parcel 6, 7539 Penn Avenue; 76th Street Widening Project S.R. No. 286 D. Consideration of approval to continue public hearing regarding preliminary plat for City Bella redevelopment project to January 14, 2003 S.R. No. 287 E. Consideration of approval of resolution establishing revised just compensation and authorizing purchase of apartment building at 6344 Cedar Avenue; Airport Noise Acquisition Program S.R. No 288 F. Consideration of approval of resolution granting subdivision waiver for 6944-13th Avenue S.R. No. 289 G. Consideration of approval of resolution authorizing issuance of Educational Facilities Revenue Note, Series 2002, to finance property for benefit of Academy of Holy Angels, 6600 Nicollet Avenue S.R. No. 290 H. Consideration of approval of extension of Contracf No. A021020 with Hennepin County to allow continued access to property information system beginning January 1, 2003 through December 31, 2003 S.R. No. 291 I. Consideration of approval of canceling December 26,.2002 City Council meeting S.R. No. 292 J. Consideration of approval of indemnification and cooperation agreement regarding Wold-Chamberlain Field Joint Airport Zoning Board and Minneapolis-St. Paul International Airport zoning ordinance (deferred from November 12, 2002) S.R. No. 293 K. Consideration of approval of request from Richfield Public Schools to waive all school district food licensing renewal fees and to waive fees for any other taxing jurisdiction S.R. No. 294 L. Consideration of approval of award of contract to Hawkins Inc. for soda ash in amount of $84,000 for 2003 and 2004 with option to renew for another two years S.R. No. 295 M. Consideration of approval of award of contract to Cutler-Magner Company for quick lime in amount of $182,000 for 2003 and 2004 with option to renew for another two years S.R. No. 296 N. Consideration of approval of award of contract to Mountain Environmental, Inc. for lime by-product disposal in amount of $86,940 for 2003 and 2004 with option to renew for another two years S.R. No. 297 ~~ O. Consideration of approval of rejection of all bids for purchase and installation of HVAC improvements at City Hall and authorization to readvertise and rebid project S.R. No. 298 Notes: PUBLIC HEARINGS 5. Public hearings to consider the following 2003 liquor license renewals: A. On-Sale Intoxicating and Sunday Liquor for Chi-Chi's, Inc., dba Chi-Chi's Mexican Restaurante, 7717 Nicollet Avenue S.R. No. 299 B. On-Sale Intoxicating and Sunday Liquor for The Frenchman's, 1400 East 66th Street S.R. No. 300 C. On-Sale Intoxicating and Sunday Liquor, including outside service of alcohol, for Wiltshire Restaurants, LLC,' dba Houlihan's Restaurant. & Bar, 6601 Lyndale Avenue S.R. No. 301 D. On-Sale Intoxicating: and Sunday Liquor for Don Pablo's Operating Corp., dba Don Pablo's, 980 West 78th Street S.R. No. 302 E. On-Sale Intoxicating and Sunday Liquor for Champps Operating Corp., dba Champps Restaurant, 790 West 66th.Street S.R No. 303 F. On-Sale Intoxicating and Sunday Liquor for Paisan Inc., dba Khan's Mongolian Barbeque, 500 East 78th Street S.R. No. 304 G. On-Sale Intoxicating and Sunday Liquor for.. The Ground Round, Inc., dba The Ground Round, 1500 East 78th Street S.R. No. 305 H. On-Sale Intoxicating. and Sunday Liquor for Taco Morelos II, Inc., Two West 66th Street S.R. No. 306 I. Club On-Sale and Sunday Liquor for Fred Babcock V.F.W. Post No. 5555, dba Four Nickels Food & Drink; 6715 Lake Shore Drive S.R. No. 307 J. Club On-Sale and Sunday Liquor for Minneapolis-Richfield American Liquor Post 435, 6501 Portland Avenue. S.R. No. 308 K. On-Sale Wine- and 3.2 Percent Malt Liquor for. Thompson's Fireside'Pizza, Inc., dba Fireside Pizza, 6736 Penn. Avenue S.R. No. 309 L. On-Sale Wine and 3.2 Percent Malt Liquor for Kiang's Red Pepper, Inc., dba Red Pepper Chinese Restaurant, 2902 West 66th Street S.R. No. 310 M. On-Sale Wine and 3.2 Percent Malt Liquor for Subeck, Inc., dba Ketsana's Thai Restaurant, 7545 Lyndale Avenue S.R. No. 311 Notes: 6. Public hearings to consider the following 2003 pawnbroker and secondhand goods dealer license renewals: A. Metro Pawn & Gun, Inc., 7529 Lyndale Avenue S.R. No. 312 `~ B. Capital Cash LLC, dba Hy's Pawn, 6414 Nicollet Avenue S.R. No. 313 Notes: 7. Public hearing -and consideration of: • Resolution approving modifications to Redevelopment Plan for Richfield Redevelopment Project Area • .Resolution-mod.ifying~Tax..increment.Financing.AP.Ian.#or.Interchange.U~/estand Lyndale Gateway Tax Increment Financing District within Richfield Redevelopment Project Area • Resolution establishing Lyndale Gateway West Tax Increment Financing District within Richfield Redevelopment Project Area and adopting Tax Increment Financing Plan Staff Report No. 314 Notes: 8. Continue to January 14, 2003, public hearing and second reading of transitory ordinance vacating alley right of way in Lyndale Gateway West project area Staff Report No. 315 Notes: 9. Public hearing and consideration of resolution authorizing amendment to planned unit development and new final development plan and conditional use permit for mixed-use development in 7600 block between Lyndale and Aldrich Avenues Staff Report No. 318 Notes: PROPOSED ORDINANCE 10. Consideration of second reading of ordinance amendment to Richfield City Code to create Section 325 for Administrative Hearing Enforcement Program and resolution regarding summary publication of ordinance amendment Staff Report No. 317 Notes: RESOLUTIONS 11. Consideration of resolutions approving 2002 Revised/2003 Proposed budget and tax levy and related resolutions Staff Report No. 318 Notes: 12. Consideration of resolution establishing Richfield Arts Commission and resolution establishing Richfield Celebrations Commission Staff Report No. 319 Notes: OTHER BUSINESS 13. Consideration of conceptual funding method for Lyndale Gateway West redevelopment project Staff Report No. 320 Notes: CITY MANAGER'S REPORT Notes: Claims and payrolls Open Forum (additional 15 minutes if more time needed after first Open Forum and by majority vote of the City Council) Each speaker is to keep their comment period to three minufes to allow sufficient time for others. Comments are to be an opportunity to address the Council on items not on the agenda. Individuals who wish to address the Council must have registered prior to the meefing. Notes: 14.Adjournment Auxiliary aids for individuals with disabilities are available upon request. Requests must be made at least 96 hours in advance to the Administrative Services Director at 612-861-9702. AGENDA SECTION: l`~ lei ~.LtSt~esS AGENDA ITEM # I .3 REPORT # 3ZO STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 REPORT PREPARED BY: JOHN STARK, COMMUNITY DEVELOPMENT MANAGER NAME, TITLE REPORT PRESENTER: JOHN STARK, COMMUNITY DEVELOPMENT MANAGER NAME, TITLE DEPARTMENT DIRECTOR REVIEW: SIGNATURE REVIEWED BY CITY MANAGER: ~ ~"~ _~,~~~ ~ ~ ITEM FOR COUNCIL CONSIDERATION: Consideration of a conceptual funding method for the Lyndale Gateway West redevelopment project. I. RECOMMENDED ACTION: By Motion: Approve, in concept, the proposed funding method (attached as Exhibit A) for the Lyndale Gateway West redevelopment aroiect. III. BACKGROUND I At the direction of the City Council and Housing and Redevelopment Authority (HRA), staff has been working on a redevelopment strategy for the Lyndale Gateway area. Lyndale Gateway, LLC (and its parent company The Cornerstone Group) has proposed a redevelopment concept that would include 28,000 sq. ft. of commercial space, 92 for-sale, loft-style condominiums and 14 for-sale townhomes. This area was first identified for redevelopment in 1985 when the HRA's consultant, "` BRW, Inc., released its report entitled "ILN Redevelopment Study". At that time, the area was within the confines of the Interstate-Lyndale-Nicollet (ILN) Redevelopment Project Area. Subsequently in 1996, the Hoisington Koegler Group was retained to study the area and presented its report entitled The Lyndale Gateway 1210LGfinancing Redevelopment Plan and Strategy. This report then became the impetus to -~ undertake requests for proposal for redevelopment feasibility for both sides of Lyndale Avenue between 76th and 77th Streets. Ultimately, two phases of the Lyndale Gateway development were completed in 2000. A third phase, which had been proposed by CSM, Inc., was nearly developed -but eventually failed to occur because of financial difficulties in developing the site. An extensive request for proposals (RFP) process began in June 2001 in which 12 select developers were asked to provide development proposals. Ultimately, the HRA chose The Cornerstone Group's proposal as the preferred development in December 2001 and entered into a Contract for Private Development in August 2002. Beginning with the initial presentation of The Cornerstone Group's proposal to the HRA, the biggest uncertainty lay in the difficulty in identifying sufficient sources of funds for the redevelopment. Because The Cornerstone Group's proposal was the most financially feasible of any presented, however, the HRA did approve the redevelopment concept and asked staff, legal counsel and the HRA's financial advisors to work with The Cornerstone Group to "find a way" to get the project financed. There are three primary difficulties in financing the project: 1. In 2001 the State Legislature passed property tax reforms which dramatically decreased the class rates and, thus, the amount of property taxes that certain properties pay; this, in turn, dramatically reduced the amount of tax increment financing (TIF) that could be generated by a redevelopment project. In the case of The Cornerstone Group's proposal, the amount of TIF generated by the development was reduced by an estimated amount of $1.4 million by these class rate changes. 2. The cost of purchasing the existing properties is estimated at over $6 million. This amount (which translates to $42 per square foot) reatl exceeds the cost that any redevelopment property has ever cost in Richfield. The reason for these high costs is because the site is so intensively utilized (resulting in high acquisition costs) and there are 24 separate tenant spaces (resulting in high relocation costs). 3. Because the majority of the proposed development is "for sale" rather than the developer retaining ownership and renting out space, it is impossible for the developer to borrow against future tax increment dollars (because they cannot directly control the TIF revenues). The typical method for financing a development in Richfield has been through "pay- as-you-go" financing in which the developer pays all of the development costs up- front and is reimbursed, over time, by the TIF revenues generated by the development. In the first two phases of the Lyndale Gateway development (the Mainstreet Village senior apartments and offices and the Casteel Place townhomes) both had to have a supplemental form of financing. This financing took the form of the issuance of $1.6 million in bonds to be repaid by tax increment being generated by the previously constructed Candlewood Hotel, a $600,000 grant from the HRA and a $320,000 loan from the HRA. The reason that this additional funding was needed for these projects was due to the high site-assembly costs and the problems associated with for-sale versus rental components. If the class-rate laws had been changed prior to the completion of these first two phases of Lyndale Gateway, additional public funding would have surely been required to make the projects feasible. In fact, it is primarily due to the class-rate changes that the former retail proposal by CSM became infeasible and was eventually withdrawn. When the traditional "pay-as-you-go" financing methods were applied to The Cornerstone Group's proposal, a financing gap remained that could not be rectified and left the status of the project as financially infeasible. Staff became optimistic, however, when a possible alternative form of funding was identified. This funding was aloes-interest loan from Fannie Mae's American Communities Fund. The concept was that the HRA would receive a $6 million loan from this source, provide the loan proceeds to the developer and would be repaid by: 1) the tax increment financing that would be generated by the development, and; 2) a portion of the sales proceeds of the townhomes and condominiums. During the early stages of the loan funding application, however, Fannie Mae staff made the determination that the HRA does not have sufficient assets to meet the requirements of the funding. Staff, legal counsel and the HRA's financial advisor then began exploring the possibility of the City of Richfield being the recipient of the Fannie Mae loan instead of the HRA. It became apparent, however, that the City would essentially be required to use its. "full faith and credit" to back the loan. This being the case, the conclusion was drawn that if the City were to obligate its full faith and credit, a General Obligation (GO) Bond issued by the City and loaned to the developer would have the same financial risks but with the added financial benefits of giving the City greater flexibility over financing options and reducing fees and interest rates. Staff, based on the advice of legal and financial advisors, are proposing the financing methods described as "Proposed Financing Method for the Lyndale Gateway West Redevelopment Project" in Exhibit A (attached) to make this project feasible. If this financing method is approved, then the City Council would be asked to consider issuance of the bonds sometime between January and July 2003. The funding would not be made available to the developer until they have: - Met their construction lender's requirements for obtaining a loan, including the pre-sale of a given percentage of units; - Received unrestricted construction loan funding in an amount sufficient for construction of all the proposed improvements; - Executed all contracts covering the construction of the proposed improvements; - Executed a loan agreement binding them to the repayment terms, and; - Retained ownership of all of the existing properties or are financially committed to paying any necessary condemnation costs. The worst-case scenario for risk to the City is that after the funding were provided to ~~, the developer they were unable to sell all of the housing units. If this were to happen, then both tax increment and sales proceeds would be reduced; thereby reducing the sources for paying the debf. to such a case, the HRA would first use the developers up-front deposit of $750,000 and then rely upon the developer's personal guarantee to assign the debt to them. In the event that that this personal guarantee were no longer valid- (due to bankruptcy or other similar events) then the -City would have to identify alternative sources (in addition to the TIF) for the unpaid balance. In this proposed financing method, there has been a concerted effort to ensure that any possible protection to the City and HRA has been identified. This proposed financing is also based on the most conservative of assumptions, including: - During the entire life of the TIF district, there would be no market value increase in the units. If one were to assume only a minimal market value increase, then the loan could be paid off much sooner. - The "worst-case" risk scenario is based on the assumption that some remaining units could not be sold at all. If one were assume that these could sell for at least 80% of their value then the risk is greatly reduced. - The developer's construction lender will probably have their own protections (most importantly, apre-sales requirement) in place to ensure construction of the units thereby reducing the risk to the City. Staff would not be proposing the City's obligation of a GO Bond if there were another method for financing this project. The financing difficulties inherent in this development are due to the changes in state tax law and the peculiarities of this site. Staff, legal counsel and the HRA's financial advisor all concur that the proposed financing method is necessary for the redevelopment of this block to .occur by this, or any other, developer. III. BASIS OF RECOMMENDATION A. POLICY • The Lyndale Gateway Area has been identified for redevelopment since 1985. • Since 1985, several potential redevelopment projects have failed to come to fruition in this area due to, in part, to the difficulty of financing a project in this area. • The City Council, and other Richfield public bodies, have shown support for the development plan being proposed by The Cornerstone Group. • Staff believes that the financing method that is now being proposed represents the only funding solution that would allow this, or any other redevelopment project, to occur at this location. • At a November 20 joint HRA/City Council Worksession, Council members indicated a willingness to formally consider this item. B. CRITICAL ISSUES '~ • The developer has already incurred considerable expense as they have advanced this project. Those expenses will continue to increase. The developer needs assurance that the City is committed to providing the necessary public financing. C. FINANCIAL • The proposed financing method was drafted with the assistance of Mr. Sid Inman of Ehlers, Inc., a public financing consultant. Mr. Inman believes that this financing method represents the least amount of financial risk that still provides the funding necessary for redevelopment to occur at this location. D. LEGAL • The proposed financing method was drafted with the assistance of legal counsel at Kennedy and- Graven; they also believe that this financing method represents the least amount of financial risk that still provides the funding necessary for redevelopment to occur at this location. IV. ALTERNATIVE RECOMMENDATION(S~ • Reject the proposed funding method for the Lyndale gateway West area with the understanding that such a decision may render it financially infeasible to redevelop this area. • Defer a decision; which would cause the developer to cease certain development activities until such time that a conceptual funding commitment can be made. V. ATTACHMENTS. • Exhibit A: Proposed Financing Method for the Lyndale Gateway West Redevelopment Project VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Sid Inman, Ehlers Associates, Inc. • John Dean, Kennedy & Graven • Heidi Kurtz, The Cornerstone. Group EXHIBIT A PROPOSED FINANCING METHOD FOR THE LYNDALE GATEWAY WEST REDEVELOPMENT PROJECT The HRA would ask the City to issue General Obligation (GO) Bonds in the amount of $6 million and the HRA would then provide the proceeds to the developer as a loan on a short-term basis. 2. The need for the $6 million is short term (2 to 3 years) and is needed to finance acquisition of property until sales are completed. 3. The borrowing would have very low short term interest only payments and the payments would come from the developer. 4. The HRA would pledge all of the future tax increments (including the Casteel Place Tax Increment) to the city to pay off the bonds. This amount is estimated to be around $2.7 to $3 million. 5. The developer would deposit 12.5% of the loan (estimated to be $750,000), for use in covering any potential shortfall. 6. The developer agrees to guarantee the amount of the $6 million loan not paid from tax increment or home sales. 7. The developer agrees to commit to sales prices of the units prior to receiving any public financing. 8. The developer would agree that after their construction loan is paid, they will pay to the HRA a percent of all home sales. 9. Once all of the homes have been sold (concluding in 2 to 3 years), the money from home sales will have paid off approximately $3 to $3.3 million of the original $6 million loan. 10. The remaining debt of $2.7 to $3 million would be paid through the tax increment generated by the development; -even under conservative assumptions this payoff should be possible in 15 years (rather than 25 years as is common in many TIF districts). 11. The City and HRA would then have a number of options for using the tax increment proceeds to pay this balance. Among these options would be the HRA's issuance of a Tax Increment Revenue Note to pay off the GO Bond, thereby absolving the City of its debt for the project. The HRA would be able to issue this type of bond at that time because the debt service coverage would be _ ensured because the project will have been completed and homes will be sold. 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M N {E} M ^ u} ~~ rn 69 fA ~ T ~ ~ C N Q } O U V >, D O O O a0 ~ O O O O ~ ~ O O O ~ O d ~O M z L `~ OO O O H ^' O O ~ ~ O O gy m ~ i~ V} - p _l ~ ~ O ~ ~ v~ ~ ~~ _ ~ u c* vti h hZ _ cs ~-+ d i O d~~ o v O U O U~ } Z W N N U~ ~ U C v ~ d ~ H ~ O~ d m C N Q O p N U N~ L C '~ fl N a m O . n a g o o ~ O ~, o ~ J 4L } ~, DC C a •v • ~ O ~ O ~ ~ Q L O .~ ~ ~ N W 7 ~~ O U i L •~ _N 7 U In U Q y- ~` N ~ C O ~ ~ L ~ (~ LL LL N ~ -~ ~ CA ~ vi = o ~ V ~ a • - -- L Cl L ~ ~ O ~ '~ -fl j ~ ~ ~ ~ o ~ y U o c y- o m L ¢ ~ ~ w = V ~ ~ ~ ~ o L _O ~ ~ a a ~ ° .~ °~ > ° ~ . m ~ a U ~ .O cn N ~ m O ~ ,r v _ L N ~ ~ o -H > C C O O _N U y ~ o v 'a m m v ~ p`°E c ~ ~ V ~ ~ E ~ O u1 N >+ to °' d a Uwc~UQ ~ E ~ c - .P: N ¢ } J a i~~a ~ m n ~ * c c~°~U~~ W J ~ N •!~ ~ >, fn ~ U U f ~ Z ~ N U N d 0 ~p~~p~a~ ¢www=w o _' ~ ° r, ac ~ °C ~ N Z ~ rn rn Z Z o, o w ~ ~ ~ ~ N f•7 OO ~ z ~ ~ ~ ~O .O M M O~ .-i •~ ~ .p N ~ .-. 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C ~ m a ~ N 7 m x 7 ~~ ~ C U p U U j- O) U y y U E C ~ O a _ ~ mca'~ mom' O OY R mo _ 33`° y>m Nm•m N N~~ aSo ~m°o ~co oC ~ H o~E o`o v • o.g o•aaiE f a°~o c coom oy`m o oc~ ` cocci o c,~N~ o o~•~ 33 ` .ro .~ n h Ems a ~ EE oL and o . mm~ ~~'E « ot o c .+~c c iox o~3c O1 m a° c m c m c o E~ m m°o ~` a caxiaai aon r~ ~ 'caoc°~ n c ~mv am ~m~ -oo ~~v `o• c aic° a mo ~ 3c 0 ` L m -a -o ~ m ri ~ m gm 3 omia ~ , - `~ - _ a o m QCa ay > c ° a ~ a m a 0 c ° • a oo o rn V c_n ~O ~cd cd~ o • ~ r ~ ~~o ~a i Cn d Cn fn i~ i~ (n ~ ~p m N ~ ~ n fn d ~ lL ~ ~ ll n 69 ~ C lL 3" V ll d ~ lL E uTi LL d U ~ V W Q •7 C d y m W = y m 0 a m m O U N N O O O N N N N O O O U ~ x C ~ m 4m1 C 0• ~ C tL U ~ ~ ~ LL ~1 O L ~ U- Y ~ m _. m ~ c ~ H J F J O 7 N U xk ~ ~ ~ # # M N rn f~ d AGENDA SECTION: KC'SO ~ tl~"I OAS AGENDA ITEM # L Z REPORT # '3 ( Q J STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 REPORT PREPARED BY: SAMANTHA ORDUNO, CITY MANAGER NAME, TITLE REPORT PRESENTER: SAMANTHA ORDUNO, CITY MANAGER NAME, TITLE REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Consideration of resolution establishing a Richfield Arts Commission and consideration of a resolution establishin a Richfield Celebrations Commission. I. RECOMMENDED ACTION: By Motion: Approve the. attached resolution establishing a Richfield Arts Commission- and the resolution establishing a Richfield Celebrations Commission. II. BACKGROUND At the November 26, 2002 City Council meeting, the Council discussed their desire to establish two new City commissions - an Arts Commission and a Celebrations Commission. Staff was directed to prepare the necessary actions to establish the new commissions and present them at the next Council meeting so that advertising for the commission openings could take place in conjunction with the other commission appointment process. Two resolutions are attached and are the only action the City Council needs to take to formally establish the two commissions. III. BASIS OF RECOMMENDATION ~. A. POLICY • The two resolutions can be discussed together, but action to approve them must be taken separately. 1210newcommissions The length of terms, number of commission members and number of consecutive terms include several choices. The Council will need to determine the appropriate number. Also, the resolutions include the term "stakeholder" as an option to allowing only residents of Richfield to serve on the commissions. The Council will have to determine if the commissions should include business or other representatives. B. CRITICAL ISSUES The City has already commenced advertising for the other commission openings (information was provided in the last Your City newsletter), so the opportunity to advertise for openings for these two commissions will lag a bit behind. Staff will prepare a press release for the Sun-Current so that information about the recruitment process can begin as soon as possible. C. FINANCIAL The Council should discuss what financial considerations it wishes to provide for the commissions, as there is nothing in the 2003 Budget for additional commission activities. D. LEGAL The resolutions fulfil the official action for establishing a City Council advisory commission. IV ALTERNATIVE RECOMMENDATION(S) ~ - . Delay taking action on establishing the new commissions. Take no action. V ATTACHMENTS Resolution -Arts Commission Resolution -Celebrations Commission VI. PRINCIPAL PARTIES EXPECTED AT MEETING ~ None. RESOLUTION NO. RESOLUTION ESTABLISHING A RICHFIELD ARTS COMMISSION WHEREAS, the Richfield City Council is committed to the beautification of the community through the promotion of art and design; and WHEREAS, the Council wishes to solicit the assistance of the stakeholders of the Richfield community to develop on-going programs, activities and initiatives to promote the arts in the community; and WHEREAS, it is the desire of the City Council to establish a Richfield Arts Commission to collaborate and advise the Council on the promotion and implementation of activities in the community for the arts in various forms and functions such as performing arts, arts and design and community beautification. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield, Minnesota that a Richfield Arts Commission be established as follows: 1. The Commission shall consist of (5) (7) (11) members, all of whom shall be (residents) (stakeholders) of Richfield. They shall be appointed by the City Council for (2) (3) year terms and can be removed by the City Council, with or without cause. No member shall serve more than (2) (3) consecutive terms. Terms shall begin on the first day of February of the year of appointment and shall continue until the thirty-first day of January in the year in which their appointments expire, or until their successors are appointed, subject, however, to prior termination as otherwise provided for in this resolution. 2. The Commission shall be advisory to the City Council on matters relating to the creation, promotion and sustainability of the arts in Richfield. This shall include, but not be limited to, theatre, creative arts and design, and community beautification. 3. In addition to the designated number of members to serve on the Commission, each January, the City Council shall designate a Council Member as liaison and a second Council Member as alternative liaison to this Commission. 4. Any of the following shall cause the office of a regular member to become vacated: (a) death; (b) disability or failure to serve, shown by failure to attend three (3) consecutive regular meetings of the Commission without good cause; (c) removal of legal residence in the City; (d) resignation in writing presented to the Mayor; (e) removal by the City Council; and, (f) election or appointment to a public office. PASSED by the City Council of the City of Richfield this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST: ,.~ Nancy Gibbs, City Clerk RESOLUTION NO. RESOLUTION ESTABLISHING A RICHFIELD CELEBRATIONS COMMISSION WHEREAS, the Richfield City Council is desirous of establishing an advisory Commission to organize, coordinate and promote celebration activities in the city of Richfield; and WHEREAS, it is the City Council's commitment to showcase. the positive aspects of the community, to celebrate successes, events and activities that will promote community pride; and WHEREAS, the City Council is further committed to showcasing Richfield and all its positive attributes to the Metro area, the state and beyond by creating an avenue by which people can participate in activities that celebrate all that make Richfield the best place to live, work, learn and recreate. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield, Minnesota that a Richfield Celebrations Commission be established as follows: 1. The Commission shall consist of (5) (7) (11) members, all of whom shall be (residents) (stakeholders) of Richfield. They shall be appointed- by the City Council for (2) (3) year terms and can be removed by the- City Council, with or without cause. No member shall serve more than (2) (3) consecutive terms. Terms. shall begin on the first day of February of the year of appointment and shall continue until the thirty-first day of January in the year in which their appointments expire, or until their successors are appointed, subject, however, to prior termination as otherwise provided for in this resolution. 2. The Commission shall be advisory to the City Council on matters relating to the development, promotion and implementation of community celebration activities and events and shall include, but not be limited to, the Richfield Centennial celebration, special event celebrations and holiday. celebrations. 3. In addition to the designated. number of members to serve on the Commission, each January, the City Council shall designate a Council Member as liaison and a second Council. Member as alternative liaison. to this Commission. 4. Any of the following shall cause the office of a regualr member to become vacated.: (a) death; (b) disability or failure to serve, shown by failure to attend three (3) consecutive regualr meetings of the Commission without good cause; (c) removal of legal residence in the City; (d) resignation in writing presented to the Mayor; (e) removal by the City Council; and, (f) election or appointment to a public office. PASSED by the City Council of the City of Richfield this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk AGENDA SECTION: AGENDA ITEM # REPORT # J STAFF REPORT CITY COUNCIL MEETING .DECEMBER 10, 2002 I~~solu.+~ons It 3~8 REPORT PREPARED BY: CHRIS REGIS, FINANCE MANAGER NAME, TITLE REPORT PRESENTER: CHRI GIS, FINANCE MANAGER NAME, TITL DEPARTMENT DIRECTOR REVIEW: ~ ~ _ . ~~ REVIEWED BY CITY MANAGER: ~J. ITEMFOR COUNCIL CONSIDERATION: Consideration of resolutions approving the 2002 Revised/2003 Proposed budget and tax levy and related resolutions. I. RECOMMENDED. ACTION: By motion: Adopt the resolutions approving the 2002 Revised/2003 Pro osed bud et and tax lev and related resolutions. II BACKGROUND I In September 2002, the City Council approved and certified a preliminary tax levy of $9,594,416 to Hennepin County. The final tax levy must now be considered and approved by the City Council. The final levy may be less but cannot be greater than the preliminary levy amount. Taxpayers have received individual parcel specific tax notices in anticipation of the truth-in-taxation hearing. The City of Richfield has conducted and closed its 2002 truth-in-taxation hearing on December 2, 2002. During the course of the public hearing, there was an opportunity for testimony from the general public. Information was also presented by staff regarding-: the proposed levy and budget. No official City Council action to act on the levy was permissible on the day of the public hearing. 1210 Budget ~, Since the initial publication of the 2003 City of Richfield proposed budget document, more up to date information with regards to the 2003 Capital Improvement Budget (CIB) has become available. This new information relates directly to one planned right of way project. The effect of this new information on the 2003 CIB is an increase of budgeted costs of $1,103,000. It should be noted that this increase in no way increases or affects the proposed General Fund tax levy. Any changes in project cost estimates must also have concurrent increases in funding for the respective projects. III. BASIS OF RECOMMENDATION ~ A. POLICY A revised 2002 budget and final 2003 budget and tax levy must be adopted on or before December 28, 2002. • Cities then have five working days after December 20 or no later than December 30 to prepare all the documentation necessary to certify a final levy to the County Auditor and State Department of Revenue. • A proposed 2003 tax levy has been submitted to the City Council for consideration. • Several related resolutions included within the total budget document need to be considered. These related resolutions are itemized in the attachment section of this staff report. B. CRITICAL ISSUES N/A C. FINANCIAL • The gross tax levy for 2003 reflects a 5.93% decrease from the previous year's gross levy. • The local tax. capacity rate for 2003, factoring in the de-certification of the LHN Tax Increment Financing district reflects a 24.62% percent decrease over the previous year. D. LEGAL Atruth-in-taxation public hearing for the 2003 proposed budget and tax levy was conducted on December 2, 2002. IV ALTERNATIVE RECOMMENDATION~S~ The. City Council could adopt a final 2003 budget and tax levy in any amount, which does not exceed the preliminary levy of $9,594,416. V ATTACHMENTS ~ Resolution adopting a proposed budget and tax levy for the year 2003. Resolution authorizing budget revisions. Resolution authorizing revision of 2002 budget of various departments. Resolution authorizing annual adjustment to City's mileage reimbursement rate to conform to Internal Revenue. Service statutory mileage reimbursement rate. Resolution establishing wastewater service rates and charges, water rates and charges, special water service charges, storm sewer rates and charges, and 6.5% penalty on past due accounts. Resolution adopting the 2003 Capital Improvement Budget. Resolution adopting, the 2004-2008 Capital Improvement Program. Resolution establishing policies, procedures, and fees for the assessing division. Resolution relating to purchasing practices in the City of Richfield. Resolution relating to the 2003 General Services Salary compensation plan. Resolution relating to the 2003 Specialized Pay Plan. Resolution relating to the 2003 Management Salary compensation plan. Resolution establishing 2003 license, permit and miscellaneous fees pursuant to the provisions of appendix D of the ordinance code of the City of Richfield. VI. PRINCIPAL PARTIES EXPECTED AT MEETING None RESOLUTION NO. RESOLUTION ADOPTING A PROPOSED BUDGET AND TAX LEVY FOR THE YEAR 2003 WHEREAS, the Minnesota Truth in Taxation law provides for a proposed tax levy to be certified to the County Auditor by September 15, 2002 and then recertified before December 31, 2002. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield, Minnesota as follows: 1. The budget for the City of Richfield for the year 2003 is hereby approved and adopted with appropriations for each of the departments to be as follows: General Fund Leg islative/Executive Administrative Services Public Safety Fire Services Community Development Public Works Recreation Services Transfers TOTAL GENERAL FUND $ 810,830 1,086,970 6,671,810 2,442,380 245,110 3,360,280 1,578,430 15,000 $16,210,810 2. The estimated gross revenue of the City of Richfield from all sources, including general ad valorem tax levies as hereinafter set forth for the year 2003 which are more fully detailed in the City Manager's official copy of the 2003 budget, are hereby found and determined to be as follows: TOTAL GENERAL FUND $16,210,810 3. There is hereby levied upon all taxable property in the City of Richfield a direct ad valorem tax in the year 2002, payable in 2003 for the following purposes and in the following amounts: PURPOSE AMOUNT General Fund' $9,086,2462 Debt Service 508,170 Provision has been made in the General Fund for the payment of the City's contributory share to Public Employees' Retirement Association. 2 General Fund Levy included all fiscal disparities distribution amounts. 4. The budget for the Housing and Redevelopment Authority of Richfield for the year 2003 is hereby ratified and approved. There is hereby leviedpon all taxablable property in the City of Richfield a direct ad valorem tax in the ear 2002, pay in 2003 for the following purposes: PURPOSE AMOUNT Housing and Redevelopment Authority $270,825 5. A certified copy of this resolution shall be transmitted to the County Auditor. Adopted by the City Council of the City of Richfield, Minnesota this 10th day of December 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk RESOLUTION NO. RESOLUTION AUTHORIZING BUDGET REVISIONS WHEREAS, the City Charter and Minnesota Statutes provide for a process for adopting an annual budget and tax levy; and WHEREAS, the City Charter provides certain authority for the City Manager and/or City Council to revise the annual budget; and WHEREAS, it would be beneficial to restate such authority with the adoption of the budget. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield, Minnesota as follows: The City Manager may increase the budget by City Council action provided that unbudgeted receipts will be available to equal or exceed the increased expenditures. 2. The City Manager may authorize transfers between divisions within a department providing the transfers do not increase or decrease the department or total budget. 3. The City Manager may transfer budgeted amounts between departments only with the approval of the City Council Adopted by the City Council of the City of Richfield, Minnesota this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk RESOLUTION NO. RESOLUTION AUTHORIZING REVISION OF 2002 BUDGET OF VARIOUS DEPARTMENTS WHEREAS, Resolution No. 9130 appropriated funds for personal services, other expenses and capital outlays for each department of the City for the year of 2002; and WHEREAS, The City Charter, Chapter 7, Section 7.09, gives the Council authority to transfer unencumbered appropriation balances from one department to another within the same fund at the request of the City Manager; and WHEREAS, The City Manager has requested a revision of the 2002 budget appropriations in accordance with Charter provisions and as detailed in the Proposed 2003 budget document. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield, Minnesota as follows: 1. That the 2002 appropriations for each department of the General Fund be amended to establish the following totals: General Fund Legislative/Executive $ 810,670 Administrative Services 1,077,730 Community Development 247,270 Public Safety 6,610,390 Fire Services 2,288,030 Public Works 3,331,740 Recreation Services 1,543,980 Transfers 15,000 TOTAL GENERAL FUND 15,924,810 DECREASE $ 814,680 2. Estimated 2002 gross revenue of the City of Richfield from all sources, as the same are more fully detailed in the City Manager's official copy of the proposed 2003 budget, are hereby revised as follows: INCREASE $402,750 3. That the City Manager and the Finance Manager bring into effect the provisions of this resolution. Adopted by the City Council of the City of Richfield, Minnesota this 10th day of December 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk RESOLUTION NO. RESOLUTION AUTHORIZING ANNUAL ADJUSTMENT TO CITY'S MILEAGE REIMBURSEMENT RATE TO CONFORM TO INTERNAL REVENUE SERVICE STATUTORY MILEAGE REIMBURSEMENT RATE WHEREAS, the Internal Revenue Service annually adjusts the business mileage reimbursement rate; and WHEREAS, the City of Richfield's present mileage reimbursement is in conformance with the Internal Revenue Service business mileage reimbursement rate; and NOW ,THEREFORE, BE IT RESOLVED, by the City Council of the City of Richfield, Minnesota: 1. That the City Manager of Richfield is hereby authorized and directed to annually adjust the City's mileage reimbursement rate to be in conformance with Internal Revenue Service guidelines. 2. That the City's mileage reimbursement rate is not to exceed the Internal Revenue Service guidelines. Approved by the City Council of the City of Richfield, Minnesota this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST Nancy Gibbs, City Clerk RESOLUTION NO. ~' RESOLUTION ESTABLISHING WASTEWATER SERVICE RATES AND CHARGES, WATER RATES AND CHARGES, SPECIAL WATER SERVICE CHARGES, STORM SEWER RATES AND CHARGES, AND 6.5% PENALTY ON PAST DUE ACCOUNTS BE IT RESOLVED by the City Council of the City of Richfield, Minnesota, as follows: SANITARY SEWER SERVICE RATES AND CHARGES FOR 2003 Pursuant to the provisions of Section 7.05 of the Ordinance Code of the City of Richfield, the rates and charges for use and service of the sanitary sewer system are hereby established to be those set forth in the following paragraphs of this resolution which rescinds Resolution No. 8832: 2. Where the rate is not based upon the metered use of water, the following quarterly flat charges are established effective January 1, 2003 for each billing district as defined in paragraph 3 of this resolution. 2003 A) Residential per unit $ 47.10 B) Commercial - Forthe equivalent of 10 or less persons $ 47.10 More than 10, less than 16 86.50 More than 15, less than 21 121.50 More than 20, less than 26 161.50 C) Institutional - For each public or private school the quarterly flat charge shall be charged whether the school is in session or not (rates being charged upon average yearly use); shall be based upon the number of students enrolled at the beginning of the quarterly billing period or the preceding period if school is not then in session; and shall be as follows: 2003 For each 100 grade school students or fraction $ 56.90 in excess thereof For each 100 junior high school students or high 143.00 School students or fraction thereof D) In addition to the above flat rates there shall be a customer Charge on each invoice as determined in paragraph 4 of this Resolution and a certification charge as determined in Section 7.05 of the City Ordinance Code. 3. Where the rate for sanitary sewer service is based upon the metered use of water on the premises, such rates shall be as follows: A) For all residential premises the rate shall be based on The actual use, or less of water for the preceding ~~ Winter quarter, per thousand gallons with a minimum of 7,000 gallons, effective January 1, 2003, for each 2003 customer billing district and shall be as follows: $ 2.41 For the purpose of this paragraph A), the winter Quarter shall be the winter quarter as specified in Subdivision 3 of said section 7.05. B) For all commercial, institutional, industrial, and other Premises, the rate per thousand gallons of water effective January 1, 2003, shall be as follows: $ 2.41 C) A customer charge shall be made for each invoice Rendered effective January 1, 2003 as follows: $ 3.00 If the invoice is for water service, as well as sanitary Sewer service, the customer charge, when collected, shall be allocated proportionally between the City's water fund, sewer fund, and its storm sewer fund based on the user fees billed for by each fund. D) Where the metered use of water on the premises for the Preceding winter quarter was not normal, the rate may be adjusted as provided in Subdivision 3 of said Section 7.05. 4. The foregoing rates and charges are in addition to, and not in lieu of, other rates and charges established by ordinance or resolution. WATER RATES AND CHARGES FOR 2003 1. Pursuant to the provisions of Section 7.15 of the Ordinance Code of the City of Richfield, the rates and charges for City water and water service are hereby established to be those set forth in the following paragraphs of this resolution: The charge due and payable to the City by each water customer of the City, during any quarter shall be $1.74 per 1,000 gallons. Water charges.shall be payable quarterly, and all bills issued after January 1, 2003 shall be at this rate. SPECIAL WATER SERVICE CHARGES FOR 2003 1. Pursuant to the provisions of Section 7.15 of the Ordinance Code of the City. of Richfield, the rates and charges for special customer services are hereby established to ` be those set forth in the following paragraphs of this resolution: 2. The charge for establishing a new customer account shall be $13.50 per account. 3. The charge for installation of meters or outside meter readers shall be $19.50 per installation. 4. The charge to flush and maintain fire hydrants located on privately owned property within the City shall be $39.00 per hydrant per year plus any required parts. 5. The charge to thaw and service water pipes on customer property shall be actual cost to the City plus thirty percent. 6. The charge for any other services not covered by the above shall be based on actual hourly cost to the City plus thirty percent. STORM SEWER RATES AND CHARGES FOR 2003 1. Pursuant to the provisions of Section 7.20 of the Ordinance Code of the City of Richfield, the rates and charges for City storm sewer service are hereby established to be those set forth in the following paragraphs of this resolution: 2. The rates and charges for the use and availability of the system are determined through the use of a "Residential Equivalent Factor" (REF). One REF is defined as the ratio of the average volume of surface runoff coming from one acre of land and subjected to a particular use, to the average volume of runoff coming from one acre of land subjected to typical single-family residential use within the City during a standard one year rainfall event. The REF's for the following land uses within the City and the billing classifications for such land uses are as follows: LAND USES REF CLASSIFICATION Cemeteries .25 1 Parks and railroads .75 2 Two-family residential 1.00 3 Single-family residential 1.00 4 Public and private schools and institutional uses 1.25 5 Multiple-family residential uses and churches 3.00 6 Commercial, industrial, and Warehouse uses 5.00 7 3. The basic system quarterly rate for storm sewer service is $45.30 per acre. of land. $9.06 is the quarterly rate for asingle-family residence, which is considered to have an acreage of one-fifth acre. The charge made against each parcel of land is then determined by multiplying the REF for the parcel's land use classification times the parcel's acreage times the basic system rate. 6.5% PENALTY ON PAST DUE ACCOUNTS 1. Customers will have thirty (30) days to pay their water, sanitary sewer, and storm sewer quarterly bills from the date of the mailing by the City. Any unpaid amount will be added to the next quarterly bill along with a 6.5% penalty on the delinquent amount. 2. The penalty charge when billed on past due accounts shall be allocated proportionally between the City's water fund, sewer fund, and storm sewer fund based on the user ~~ fees billed for each fund. Adopted by the City Council of the City of Richfield, Minnesota this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk RESOLUTION NO. RESOLUTION ADOPTING THE 2003 CAPITAL IMPROVEMENT BUDGET WHEREAS, a proposed Capital Improvement Budget for 2003 has been prepared and submitted for review by the City Council in accordance with charter requirements; and WHEREAS, the City Council has received the recommendations and benefit of review of these proposed documents by the Planning Commission and has itself reviewed these proposals. NOW, THEREFORE, BE IT RESOLVED that the 2003 Capital Improvement Budget in the sum total of $18,073,000 is hereby approved as amended and adopted with full recognition of the fact that the cost estimates are approximate and are subject to final cost estimates and that all awards of contracts for these projects are subject to necessary hearings and must be approved by the City Council in accordance with established laws and practices governing such action, and BE IT FURTHER RESOLVED that the City Manager is hereby authorized and directed to initiate the procedures which will lead to more formal and detailed consideration of these projects in accordance with the aforementioned laws and practices. Adopted by the City Council of the City of Richfield, Minnesota this 10h day of December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk RESOLUTION NO. RESOLUTION ADOPTING THE 2004-2008 CAPITAL IMPROVEMENT PROGRAM WHEREAS, a proposed Capital Improvement Program 2004-2008 has been prepared for review by the Planning Commission in accordance with charter requirements; and WHEREAS, the City Council has received the recommendations and benefit of review of these proposed documents by the Planning Commission and has itself reviewed these proposals. NOW, THEREFORE, BE IT RESOLVED that the 2004-2008 Capital Improvement Program is hereby approved and adopted subject to annual review and revision; BE IT FURTHER RESOLVED that the City Manager is hereby authorized and directed to initiate the procedures which will lead to more formal and detailed consideration of these projects in accordance with the aforementioned laws and practices. Adopted by the City Council of the City of Richfield, Minnesota this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk RESOLUTION NO. RESOLUTION ESTABLISHING POLICIES, PROCEDURES, AND FEES FOR THE ASSESSING DIVISION WHEREAS, the City Assessing Division provides a variety of services to the public, to title companies and to realtors, relating to information necessary for sale and purchase of property; and WHEREAS, special assessment searches are requested when closing on purchased properties; and WHEREAS, listing information is requested when there is an interest in property sales or purchases; and WHEREAS, residential property records are requested when comparing properties for market values; and WHEREAS, certain specific information, such as special assessment searches, property listing information, comparable residential property records and homestead information are regularly sought by realtors, title companies and homeowners in the sale and transfer of property within the City; and WHEREAS, the above list of requests for information constitutes a large portion of the work load of the City Assessing Division; and WHEREAS, said policies, procedures and fees must be reviewed and modified as needed. NOW, THEREFORE, BE IT RESOLVED that the City Council hereby establishes the following policies, procedures and fees for dissemination of certain information in the City's Assessing Division. I. SPECIAL ASSESSMENT PROCEDURES SEARCHES Provided, upon receipt or written request for multiple searches or phone request for same day pickup of a single search, by City Assessing Division identifying levied and pending assessments. Provide written request and $15.00 fee per Property Identification Number (PID). Searches are normally in the mail 24 hours after receipt. Provide verbal update by phone of previously requested certified City special assessment searches. FEES $15.00 per Property Identification Number (PID). The search is a billing statement. Provided the same day if a Provided free of charge single certified or if a certified City search non-certified search is is not requested. requested and if picked up at the City. I. (con't) SPECIAL ASSESSMENT PROCEDURES FEES SEARCHES Do not provide additional billing statements for assessments. Provide, upon written request, a report (or run) of all properties affected by a levied or pending special assessment. II. LISTING INFORMATION Provide, upon multiple written or a single phone request printouts. Printouts include: PID number Estimated Market Value Tax information Owner/taxpayer Legal Description Special assessments (levied and pending) Provided the following work Homeowner may dayfor multiple certified or request a $15.00 search non-certified search requests for closing purposes. and will be available for pickup after 3:00 p.m. An initiation fee of $30.00 for each Verbal verification (update) of requested report. Plus, City certified levied and $.05 for each Property pending assessments search Identification (PID) before closing. After Number. identifying self, caller will provide property address, PID A requested new number, date and receipt program would require a number of search. minimum fee of $25.00. Fees would be based on Provided within a minimum of time and materials to 48 hours if there is an create and print the existing program, additional program. hours if more than one report is requested. Anon-existing program would require additional time. A program would be created on a priority basis and then printed. Requesting party would be notified as to fee and date report(s) can be picked up at the Assessing office prior to printing. PROCEDURES FEES A phone or written request $3.00 per PID number. and receipt of $3.00. Homeowners may Allow 1/2 hour before pickup request a free printout. for a single property request to prevent waiting for Provided free of charge information. Allow 24 hours if printout is not from receipt of request for requested. pickup of listing information on multiple properties. II (con't) LISTING INFORMATION PROCEDURES FEES Lot size Year built Square footage Give name, firm, address of property and PID number (if available for requests). Provide verbal updates by Three listing inquiries on the phone of previously following accessible requested City printouts. information will be provided by phone by the City: PID number Year built Lot size School district Legal description Taxes Square footage Mill rate for Richfield Estimated difference between homestead and non-homestead tax amounts. Fee owner/taxpayer Market value Homestead status Inquiries by phone for square footage of buildings will be limited to two properties. Additional properties will require obtaining information in person at the City Assessor's office. Net rentable areas for income properties are protected under the Data Privacy Act; and therefore, will not be given as fisting information. Special assessments will not be given by phone. However, they will be given at the City office when requested. II. (con't) LISTING INFORMATION PROCEDURES Exception: Homeowners will be given special assessments by phone if they provide their social security numbers. Otherwise, the owner can request a free complete listing printout. Give name, firm, property address, PID number, date of printout and receipt number when updating printouts. Requested complete listing information, without a requested printout, will be partially supplied verbally by the Assessing Division. The Division will orally supply special assessments, next year's market value (when available), and homestead status. Requesting party will be allowed to use the County's terminal screen for additional information (only screens 101, 103, 105, 108, 109, 120, 275 and 282). Interruptions will occur for City use. Time limits on the County's terminal will be set based on City's immediate needs. III. REVIEW OF COMPARABLE PROCEDURES RESIDENTIAL PROPERTY RECORDS Provide a field card record of a Request for more than subject property and five properties must be comparable properties. submitted in writing and include individual property addresses FEES FEES May request $1.00 per copy. for up to five comparable properties. Certified copies $5.00. III. (cont.) REVIEW OF COMPARABLE RESIDENTIAL PROPERTY RECORDS PROCEDURES (PID numbers will help cut response time). The individual must allow the City to set the time convenient for the City to supply information on a one-on-one basis. More than five comparable properties, will be allowed to view and record information under strict supervision of the Assessing Division. The City will not assemble or analyze data. Certified copies will state: "This is a true and correct reproduction of the original on file at the City Assessor's office". IV. REVIEW OF COMPARABLE PROCEDURES COMMERCIAL, INDUSTRIAL AND APARTMENT PROPERTY RECORDS Provide partial field card record of a subject property and comparable properties. Request for more than five properties must be submitted in writing and include individual property addresses (PID numbers will help cut our response time). Because of the data privacy act, viewing the property field cards will be prohibited. FEES Free of charge when personally writes information supplied by the Assessing Division. FEES May request $2.00 per copy. Certified copies $5.00. Free of charge when personally writes information orally supplied by the Assessing Division. IV. (con't) REVIEW OF COMPARABLE COMMERCIAL. INDUSTRIAL AND APARTMENT PROPERTY RECORDS PROCEDURES Confidential ,private or nonpublic data is protected under the data privacy act. The following confidential data is recorded on the property field cards: a. Detailed income and expense figures; b. Average vacancy factors; c. Verified net rentable areas or net usable areas; d. Anticipated income and expenses for the current year; and e. Projected vacancy factor for the current year. The above confidential information will be blocked out when photocopying field cards. The individual must allow the City to set the time convenient for the City to supply information on a one-on-one basis. The City will not assemble or analyze data. Certified copies will state: "This is a true and correct reproduction of the original on file at the City Assessor's office". FEES Passed by the City Council of the City of Richfield, Minnesota, this 10th day of December, 2002. Martin J, Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk RESOLUTION NO. RESOLUTION RELATING TO PURCHASING PRACTICES IN THE CITY OF RICHFIELD AMENDING RESOLUTION NO. 8298 WHEREAS, the, City Manager of the City of Richfield has purchasing authority pursuant to the City Charter and Administrative Ordinance Code; and WHEREAS, the City Charter and Administrative Ordinance Code expressly state a purchasing authority limit for the City Manager, and WHEREAS, all non-budgeted purchases in excess of $25,000 will require approval by City Council. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield as follows: That the City Manager of the City of Richfield is hereby granted the authority to enter into contracts or approve purchases on behalf of the City of Richfield up to, but not to exceed $25,000. Adopted by the City Council of the City of Richfield, Minnesota this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk RESOLUTION NO. RESOLUTION RELATING TO THE 2003 GENERAL SERVICES SALARY COMPENSATION PLAN ~` WHEREAS, the municipal code of the City of Richfield provides for the adoption of a pay plan for General Services employees from time-to-time, and WHEREAS, the City administration has prepared a 2003 pay plan for position classifications for General Services employees. The City Manager is authorized to add or reclassify positions as necessary. Examples of positions in each pay grade are attached. NOW, THEREFORE, BE IT RESOLVED that the City Council do and hereby does establish for the year 2003 the following pay plan, which is to be effective January 1, 2003, the first full pay period in 2003 and subject to all applicable provisions of the City Code: 2003 GENERAL SERVICES COMPENSATION PLAN STEP 1 2 3 4 5 6 RANGE GS1 YR 25,313.60 26,832.00 28,350.40 29,868.80 31,636.80 32,593.60 MO 2,109.47 2,236.00 2,362.53 2,489.07 2,636.40 2,716.13 BW 973.60 1,032.00 1,090.40 1,148.80 1,216.80 1,253.60 HR 12.17 12.90 13.63 14.36 15.21 15.67 GS2 YR 27,892.80 29,328.00 30,763.20 32,323.20 33,966.40 35,672.00 MO 2,324.40 2,444.00 2,563.60 2,693.60 2,830.53 2,972.67 BW 1,072.80 1,128.00 1,183.20 1,243.20 1,306.40 1,372.00 HR 13.41 14.10 14.79 15.54 16.33 17.15 GS3 YR 30,763.20 32,323.20 34,008.00 35,672.00 37,440.00 39,499.20 MO 2,563.60 2,693.60 2,834.00 2,972.67 3,120.00 3,291.60 BW 1,183.20 1,243.20 1,308.00 1,372.00 1,440.00 1,519.20 HR 14.79 15.54 16.35 17.15 18.00 18.99 GS4 YR 34,008.00 35,672.00 37,502.40 39,374.40 41,329.60 43,492.80 MO 2,834.00 2,972.67 3,125.20 3,281.20 3,444.13 3,624.40 BW 1,308.00 1,372.00 1,442.40 1,514.40 1,589.60 1,672.80 HR 16.35 17.15 18.03 18.93 19.87 20.91 GS4E YR 36,524.80 38,313.60 40,289.60 42,348.80 44,449.60 46,716.80 MO 3,043.73 3,192.80 3,357.47 3,529.07 3,704.13 3,893.07 BW 1,404.80 1,473.60 1,549.60 1,628.80 1,709.60 1,796.80 HR 17.56 18.42 19.37 20.36 21.37 22.46 GS5 YR 37,502.40 39,374.40 41,329.60 43,492.80 45,676.80 47,964.80 MO 3,125.20 3,281.20 3,444.13 3,624.40 3,806.40 3,997.07 BW 1,442.40 1,514.40 1,589.60 1,672.80 1,756.80 1,844.80 HR 18.03 18.93 19.87 20.91 21.96 23.06 GS5E YR 40,289.60 42,348.80 44,408.00 46,716.80 49,046.40 51,500.80 MO 3,357.47 3,529.07 3,700.67 3,893.07 4,087.20 4,291.73 BW 1,549.60 1,628.80 1,708.00 1,796.80 1,886.40 1,980.80 HR 19.37 20.36 21.35 22.46 23.58 24.76 GS6 YR 41,329.60 43,492.80 45,676.80 47,964.80 50,398.40 55,598.40 MO 3,444.13 3,624.40 3,806.40 3,997.07 4,199.87 4,633.20 BW 1,589.60 1,672.80 1,756.80 1,844.80 1,938.40 2,138.40 HR 19.87 20.91 21.96 23.06 24.23 26.73 GS6E YR 44,408.00 46,716.80 49,067.20 51,500.80 54,100.80 59,737.60 ~, MO 3,700.67 3,893.07 4,088.93 4,291.73 4,508.40 4,978.13 BW 1,708.00 1,796.80 1,887.20 1,980.80 2,080.80 2,297.60 HR 21.35 22.46 23.59 24.76 26.01 28.72 a. Step 1 -Start b. Step 2 -One year from anniversary date. c. Step 3 -One year since last increase. If an employee is rated Needs Improvement, the employee may not advance to Step 3 until performance is rated Satisfactory or higher. d. Step 4 -One year since last increase. If an employee is rated Needs Improvement, the employee may not advance to Step 4 until performance is rated Satisfactory or higher. e. Step 5 -One year since last increase. An employee must achieve a Satisfactory rating or better in all areas of responsibility before advancing to Step 5. f. Step 6 -One year since last increase. An employee must achieve a Satisfactory rating or better in all areas of responsibility before advancing to Step 6. Employees whose competency level and/or pertormance are rated Unsatisfactory may not advance to the next step until their performance improves. Passed by the City Council of the City of Richfield, Minnesota this 10th day of December 2002. Martin J. Kirsch ATTEST: --iVancy Gibbs City Clerk Mayor (Revised 1202) GENERAL SERVICES POSITION CLASSIFICATION STRUCTURE GRADE POSITION TITLES CLASS 1 Clerk Typist Non-Exempt Data Entry Operator Switchboard-Receptionist Non-Exempt Non-Exempt 2 Community Development Technician Non-Exempt Community Service Officer Non-Exempt Custodian Non-Exempt Finance Clerk Non-Exempt Lead Liquor Clerk Non-Exempt Licensing Clerk Non-Exempt Police Cadet Non-Exempt Senior Clerk Typist Non-Exempt Senior Clerk Typist/Investigative Clerk l st ti S t T Non-Exempt t Non-Exem i pecia a on ranspor p 3 Accounting Clerk Non-Exempt Arena Operations Assistant Non-Exempt Code Compliance Specialist Non-Exempt Community Development Technician II Non-Exempt Facility Operations Assistant Non-Exempt Forestry Inspector/Operations Assistant Health/Licensing Specialist Non-Exempt Non-Exempt Leased Housing Assistant Non-Exempt Secretary Non-Exempt Utility Billing Clerk Non-Exempt 4 Assessment Clerk Non-Exempt Administrative Aide Non-Exempt _ Information Technologies Technician Non-Exempt Housing Inspector I Non-Exempt 4E Administrative Aide Exempt Enterprise Facilitator Exempt Payroll Accountant Exempt Project Assistant Exempt Records Supervisor Exempt 5 Assistant Building Maintenance Supervisor Non-Exempt Engineering Technician Non-Exempt Facility Maintenance Supervisor Non-Exempt Housing Inspector II Non-Exempt 5E Administrative Assistant Exempt Assistant Liquor Store Manager Exempt Civilian Crime Prevention Specialist Exempt Community Center Programmer Exempt Community Development Accountant Exempt Community Development Specialist Exempt Human Services Planner/Coordinator Exempt Leased Housing Specialist Exempt Motor Vehicle Licensing Supervisor Exempt Planning and Research Specialist Exempt Recreation Supervisor Exempt Redevelopment Specialist Exempt Rehabilitation Specialist Exempt o, Youth Resource Specialist Exempt Zoning Administrator Exempt 6 Electrical/Building Trade Inspector Non-Exempt Network Administrator Non-Exempt 6E Accountant Exempt RESOLUTION NO. RESOLUTION RELATING TO THE 2003 SPECIALIZED PAY PLAN WHEREAS, Section 310.17 of the Ordinance Code of the City of Richfield provides that the pay grades, the number of steps or range of each pay grade, the compensation rates in each pay grade and the method of normal progression through the pay grade be established by Council resolution; and WHEREAS, the City administration has prepared a 2003 pay plan for the positions for which there are no essentially similar position classification in other regular pay plans. The City Manager is authorized to add or reclassify positions as necessary. Examples of positions in each pay grade are attached. NOW, THEREFORE, BE IT RESOLVED that the City Council do and hereby does establish for the year 2003 the following pay plan which is to be effective on January 1, 2003, the first full pay period in 2003 and subject to the provisions of the personnel rules and regulations ordinance: SPECIALIZED PAY PLAN INTERMITTENT AND SEASONAL 2003 SPECIALIZED PAY PLAN INTERMITTENT AND SEASONAL Pay Grade Step 1 Step 2 Step 3 Step 4 SP1-E/NE HR 6.13 6.45 6.72 7.07 S P2-E/N E H R 6.78 7.10 7.44 7.82 SP3-E/NE HR 7.30 7.67 8.05 8.46 S P4-E/N E H R 7.90 8.30 8.70 9.15 S P5-E/N E H R 8.50 8.95 9.39 9.86 S P6-E/N E H R 9.23 9.68 10.15 10.66 SP7-E/NE HR 9.92 10.44 10.96 11.49 SP8-E/NE HR 10.73 11.28 11.83 12.42 SP9-E/NE HR 11.58 12.18 12.78 13.41 SP10-E/NE HR 12.55 13.16 13.83 14.53 SP11-E/NE HR 13.49 14.21 14.92 15.64 SP12-E/NE HR 14.62 15.32 16.08 16.91 SP13-E/NE HR 15.66 16.50 17.36 18.25 Instructor's Range: $5.75 - $50 Election Judge: $7.25 Election Assistant Chair Person: $7.50 Election Chairperson: $8 Normal Progression Through the Specialized Pay Plan Individual employees will be eligible to received increases to the next higher-grade step based on individual performance and the following progression: Step 1 -Start Step 2 -One year from anniversary date Step 3 -One year from last increase Step 4 -One year from last increase Passed by the City Council of the City of Richfield, Minnesota this 10th day of December, 2002. Martin J. Kirsch Mayor ATTEST: Nancy Gibbs City Clerk 1 f~. 3 4 5 6 7 E Pool Attendant E Pool Night Watch E Student Intern 8 NE Adaptive Coordinator NE Administrative Services Clerk NONE NE Clerk Typist -Int. & Substitute NE Construction Inspector NE Bike Patrol Officer NE Farmers Market Coordinator NE Concession I (all sites EXCEPT Pool, E Playground Coordinator Vet's & Taft) NE Publication Supervisor NE Scorer/Timer E Maintenance Technician NE Recreation Attendant I E Tennis Coordinator E Concession I (Pool, Vet's & Taft only) E Facility Rental Attendant 9 NE Community Development Tech. E Special Facilities Coordinator NE Arena Attendant NE Dance Coordinator & Skate 10 NE Adult Sports Coordinator Coordinator NE Engineering Aide NE Recreation Attendant II (Men's Open E Pool Supervisor Gym & Sports Attendant) E Concession II 11 NE Community Relations Coordinator E Facility Cashier E Mini Golf Attendant 12 NONE E Recreation Attendant II (Parks Water Slide Attendant) 13 NE 911 Dispatcher NE Adaptive Assistant Instructors NE Custodian NE Building Inspector NE Professional Intern NE Figure Skating NE Substitute Van Driver NE Hockey (Arena) NE Survey Crew Person NE Housing & Redevelopment Tech. NE Winter Sports Attendant NE .Sports Official E Warming House Attendant NE Substitute Naturalist NE Dance NE Adaptive Leader/Specialist E .Cross Country Ski NE Concession III (all sites EXCEPT Pool) E Golf Professional NE Receptionist E Hockey (outside) E Concession III E Tennis E Lifeguard E WSI E Outdoor Skating Supervisor OTHER E Playground Leader Election Judge $7.25 E Warming House Supervisor Election Chair Person $7.50 Election Chairperson $8 NE Accounting Clerk NE Adaptive Program Supervisor NE=Non-Exempt, may work up to 40 hours per NE Building Attendent week witho ut overtime pay. NE Concession Supervisor (all sites E-Exempt may work up to 48 hours per week EXCEPT Pool) without overtime pay. NE Construction Specialist All Pool position s are exempt from overtime, even Concessions. NE Liquor Sales Associate All Golf positions, except Concessions/Pro Shop positions, are exempt. All Playground and outdoor Rink positions are exempt. NE Maintenance Laborer All Community Center, Wood Lake Nature Center, Ice Arena and NE Naturalist I Maintenance positions are non-exempt. (Revised 2003) NE Zamboni Operator NE Video Production Assistant E Mini Golf Supervisor E Concession Supervisor RESOLUTION NO. RESOLUTION RELATING TO THE 2003 MANAGEMENT SALARY COMPENSATION PLAN WHEREAS, the municipal code of the City of Richfield provides for the adoption of a pay plan for Management employees from time-to-time; and WHEREAS, the City administration has prepared a 2003 pay plan for position classifications for Management employees. The City Manager is authorized to add or reclassify positions as necessary. Examples of positions in each pay grade are attached. NOW, THEREFORE, BE IT RESOLVED that the City Council do and hereby does establish for the year 2003 the following pay plan, which is to be effective January 1, 2003, the first full pay period in 2003 and subject to all applicable provisions of the City. MANAGEMENT COMPENSATION PLAN PAY GRADE MINIMUM MID-RANGE MAXIMUM M-1 YR 47, 860.80 54, 704.00 61, 526.40 MO 3, 988.40 4, 558.67 5,127.20 B W 1, 840.80 2,104.00 2, 366.40 H R 23.01 26.30 29.58 _ M-2 YR 56,950.40 65,083.20 73,236.80 MO 4,745.87 5,423.60 6,103.07 B W 2,190.40 2, 503.20 2, 816.80 H R 27.38 31.29 35.21 M-3 YR 62, 088.00 70, 948.80 79, 809.60 MO 5,174.00 5, 912.40 6,650.80 B W 2, 388.00 2, 728.80 3, 069.60 HR 29.85 34.11 38.37 M-4 YR 64,251.20 73,424.00 82,617.60 M 0 5, 354.27 6,118.67 6, 884.80 BW 2,471.20 2, 824.00 3,177.60 H R 30.89 35.30 39.72 M-5 YR 76, 460.80 87, 380.80 98, 300.80 MO 6,371.73 7,281.73 8,191.73 BW 2, 940.80 3, 360.80 3, 780.80 H R 36.76 42.01 47.26 C a C O Q.. 0 U 0 N t4 C cC t 3 O L ~"' C .N N i O L a tC 0 z ~/ '~ .~ L r ~ ~_ L r ^® ~ ~_ ~ 'L S ~.~. ~+ U ~ o N .~ ~ ~ o ~ O =p~M > O 0~ ~ ~ Q O ~ ~ O ~ O ~~ ~ W C O r ~ ~ p o ~ .~..~. N ~ o ~ W ~ ~ Z C C •~ ~ ~ ~ L L Z o ~ Q a a 0 ~ w ~~ o U (Q z ~ ~ ~ !n ~ o o ~ z -~ r ~~ ~ o O~ Q O ~ ~ H- M ~ ~ O vi ~ ~ O O ~ O ~ ~ > c m o ~ ~ ~ .-. Oa o ~ arn~- ~.~ o ~ ~ a ~ ~ ~ ._ Q ~ U ~ = O ~ ~ C t 6 r L `V ~ C L __ ~ ~ 3 Z O ~~ ~~ ~ ~ ~ ~ ~~ ~ ~ ~~~ ~ ~ '~"' ~~ U ~, U '~ ~ N ~ 0 0 0 ~ ~ ~ ~'~~ O~O~~ ~ tU ~ ~ ° ~~rri~ ~ ~'~ ~~o L ~ooo~, ~= ~ L ~ Q z~Cfl~ ~ ~M~~~ .-.O ~C ~`t .~ ~ Q ~ Q- C ~ - ~ ~ W ;~ Z o ~ ~ ~.. ~.~~ acs ~ ~ Qa~~ ~? o ~ " i ~ o a /u~~//- ~ v ~ LL o L C .~ m W ~ (6 0 ~ (Q ~~~ c~ ~ ~ "'' > " ~ u~ a (nom n ~ .II (Q N OQc~z C ~ N O O N L U a~ 0 (6 L O N L c6 O C L U 0 ~_ U a~ O ~U C O U _~ U a~ t a a~ n~ LL O (Q U i Y ~_ '~ (if Y U ~_ U /~ n W v H ~ Q Z MANAGEMENT POSITION CLASSIFICATION STRUCTURE ~, RANGE POSITION TITLES CLASS M-1 Assistant to the City Manager Exempt Building Maintenance Supervisor Exempt City Clerk Exempt Facility/Program Manager Exempt Supervisor Exempt Health Administrator Exempt Liquor Store Manager Exempt Engineer -Project Exempt M-2 Chief Building Official Exempt Community Development Manager Exempt Information Technologies Manager Exempt Engineering Supervisor Exempt Housing & Redevelopment Manager Exempt Transportation Engineer Exempt M-3 Asst. Fire Chief/Fire Marshal Exempt Finance Manager Exempt Human Resources Manager Exempt Operations Superintendent Exempt Utility Superintendent Exempt M-4 None Exempt M-5 Department Director Exempt (Rev. 12-02) RESOLUTION NO. RESOLUTION ESTABLISHING 2003 LICENSE, PERMIT AND MISCELLANEOUS FEES PURSUANT TO THE PROVISIONS OF APPENDIX D OF THE ORDINANCE CODE OF THE CITY OF RICHFIELD RESCINDING RESOLUTION NO. 9139 BE IT RESOLVED by the City Council of the City of Richfield, Minnesota as follows: SECTION 1. ESTABLISHING FEES A. License, permit and miscellaneous fees required under the ordinances of the City of Richfield shall be as stated in the sections of this Resolution. B. A period of no less than 30 days will be allowed for the remittance of City Business license renewal fees contained in Sections 5,7, 8 and 9 of this resolution. C. A 10% administrative surcharge will be assessed upon all renewals contained in Section 5, 7, 8 and 9 of the resolution if not received by the City on or before December 31st of each year. The 10% surcharge will be based upon the cost of the license. D. Nothing in this section shall be deemed to require the City to issue or renew any license for which the fee has not been paid in a timely manner. SECTION 2. CONSTRUCTION AND RELATED PERMIT FEES AND CHARGES TYPE OF PERMIT OR LICENSE SECTION REQUIRING TOTAL VALUATION FEE SCHEDULE (1) Building 400.03-400.09 $1 to $500 $23.50 Permits $501 to $2,000 $23.50 for the first $500 plus $3.05 each additional $100, or fraction thereof, to and including $2,000. $2,001 to $25,000 $69.25 for the first $2,000 plus $14.00 for each additional $1,000, or fraction thereof, to and including $25,000. $25,001 to $50,000 $391.25 for the first $25,000 plus $10.10 for each additional $1,000, or fraction thereof, to and including $50,000. $50,001 to $100,000 $643.75 for the first $50,000 plus $7.00 for each additional $1,000, or fraction thereof, to and including $100,000. $100,001 to $500,000 $993.75 for the first $100,000 plus $5.60 for each additional $1,000, or fraction thereof, to and including $500,000. $500,001 to $1,000,000 $3,233.75 for the first $500,000 plus $4.75 for each additional $1,000, or fraction thereof, to and including $1,000,000. 1,000,001 and up $5,608.75 for the first $1,000,000 plus $3.65 for each additional $l ,000,or fraction thereof. D-i SECTION 2 CONSTRUCTION AND RELATED PERMIT FEES AND CHARGES (CONTINUED) TYPE OF PERMIT SECTION OR LICENSE REQUIRING FEE DESCRIPTION ~~ (a) Inspections outside of normal business hours $47.00 per hour - (minimum charge -two hours) (b) Reinspection fees assessed under provisions of Section 108.8 $47.00 per hour (c) Inspections for which no fee is specifically indicated (minimum charge - one-half hour) $47.00 per hour (d) Additional plan review required by changes, additions or revision to plans (minimum charge -two hours) $47.00 per hour *Or the total hourly cost to the jurisdiction, whichever is the greatest. This cost shall include supervision, overhead, equipment, hourly wag es and fringe benefits of he employee involved. (2) Driveway, Parking Area Permits 515.05 (no permit fee for sidewalks) $ 25.00 (3) Fire Extinguishing System Permit 400.03-400.09 Based on Building Permit fee schedule with a minimum of $ 23.50 (4) Swimming 420.00 Permanent above or below ground pools are $ 23 50 . based Building Permit. Portable Pools (No fee shall be charged for construction or erection of any pool 24 inches or less in depth at its deepest part and not exceeding 177 sq ft in water surface) (5) Plan Review Fee 400.03-400.09 65% of building permit fee, except no fee for the following: and State Building Code (a) Existing single family dwelling alterations when habitable area is not enlarged. (b) Single and two family dwelling repair and maintenance work. (c) Commercial and industrial repair and maintenance work not exceeding $1,000 or where plans are not required. (d) Residential garages and storage buildings. (6) Contractors License Verification Fee Charged once each time a contractor applies for permit(s) $ 5.00 (7) Moving Dwellings 845 Pre-inspection Fee: IN Richfield $ 35.00 and Buildings other than Dwellings 70.00 OUTSIDE Richfield $ Moving Permit Fee: WITHIN Richfield $ 35.00 INTO Richfield $ 70.00 Moving Out of City $ 35.00 (8) Garage 845 Pre-inspection Fee: (if relocated in City) $ 23.50 Moving Garage Moving Permit Fee $ 16.00 (9) Structure Demolition 400.00-400.09 (a) Commercial Demolition cost as per Building Permit Schedule with a minimum of $ 23.50 (b) Dwelling 1. One or two story $ 23.50 2. Residential -Garage and lesser structure $ 1 1.50 D-2 SECTION 2._CONSTRUCTION AND RELATED PERMIT FEES AND CHARGES (CONTINUED TYPE OF PERMIT SECTION OR LICENSE REQUIRING DESCRIPTION FEE (10) Plumbing Permit 400.03-400.09 Residential (a) Minimum Fee 2% of Total Job cost with a minimum of $ 30.00 (b) Work required to comply with minimum Housing Code Provisions $ 18.00 (11) Plumbing Permit 400.03-400.09 Commercial -Based on Total Job cost 2% of Estimated Job cost with a minimum of $ 40.00 (12) Electrical Permit 400.03-.400.09 Residential $ 30 00 (a) Minimum Fee . (b) Complete Wiring Fee: Single Family Residence $ 55.00 Two Family Residence $106.00 (c) New Service - up to 200 amps $ 13.50 (d) Temporary Service - (for construction) $ 19.00 (e) Installation or replacement of each major appliance during or after completion of building $ 9.00 (f) Swimming Pools $ 25.00 (g) Wiring of Addition or rewiring: First Room $ 13.50 Each Additional Room $ 6.50 (h) Furnace or Air Conditioning: Per Unit $ 9.00 (i) Electrical Heating System: 2% of estimated job cost with a minimum of $ 19.00 (j) Electric or base board (Infrared Heaters): Per Circuit $ 9.00 (k) Work required to comply with minimum Housing Code provisions other than new service - 2% of contract cost with minimum of $ 18.00 (13) Electrical Permit 400.03-400.09 Commercial, Industrial and multiple dwellings Commercial (more than two units) Minimum Fee $ 40.00 (a) Based on total job cost - 2% of estimated job cost with a minimum of $ 40.00 - Over $50,000 -Fee/ $1,000.00 plus 1 1 /2% of cost over $50,000.00 (b) Traffic Signals: Per Intersection $185.00 (14) Electrical Permit 400.03-400.09 Based on 2% of cost of electrical job to customer with a minimum of $ 40.00 Signs (separate electrical permit required for signs) (15) Heating, 400.03-400.09 Central Systems and Additions, Alterations and Repairs Ventilating, Air 1 1 /2% estimated cost with a minimum of $ 30.00 Conditioning and Refrigeration (16) Heating, 400.03-400.09 (a) Fuel storage Tanks (Underground or Enclosed) Ventilation Installation to be used with oil burner only. , Air Conditioning, Refrigeration Per tank not exceeding 1,000 gal. $ 10.00 Storage Tanks Per tank exceeding 1,000 gal. $ 20.00 (b) Fuel Storage Tanks (Above ground or not enclosed) Installation to be used with oil burner only. Per tank $ 10.00 (c) Other Tanks (Installation modification, removal, abandonment) Each above ground tank $ 30.00 Each below ground tank $ 80.00 For installation or alteration of piping $ 15.00 (17) Sign 415.01-415.1 1 (a) Temporary sign permit $ 30.00 00 $ 75 Installation (b) Permanent sign (any size) . (c) Sign support structures based on building permit fee schedule (18) Parking Areas .800.15-800.23 $ 8.00 D-3 SECTION 3. CONSTRUCTION AND RELATED LICENSE FEES TYPE OF PERMIT SECTION OR LICENSE REQUIRING DESCRIPTION (1) Heating and 400.07 Ventilating Installer (2) Sign Installer 16.01-416.13 (3) Electrical Installer 00.03-.400.09 State License Required (4) Plumber 400.03-400.09 State License Required (5) Well Driller 620 State License Required SECTION 4. ZONING, LAND USE AND RELATED CHARGES TYPE OF PERMIT SECTION OR LICENSE REQUIRING DESCRIPTION (1)* Planned Unit 536 (a) $500 plus $5/ $1,000 of project value up to a Development maximum fee of (2)* C-3 Zoning District 526.39 Site Plan Review Transitional Activity permit 526.63 (3)* Variance 546.09 Variance Appeal (4)* Conditional 546.05 Use Permit FEE 1 Year $ 75.00 1 Year $ 75.00 (b) PUD Plan Amendment fee -major (c) PUD Plan Amendment fee -minor (a) $500 plus $5 / $1,000 of project value to a maximum fee of (b) Plan Amendment Fee $300 plus $5/ $1,000 of project value up to a maximum fee of Residential Non Residential Extension Residential and Non Residential (a) change in use (b) new construction or building addition up to 20,000 sq. Ft. (c) new construction or building addition over 20,000 sq. Ft. $600 + $.50/$1,000 of construction value up to a maximum fee of FEE $3,500.00 $ 550.00 $ 250.00 $3,500.00 $ 550.00 $3,000.00 $ 250.00 $ 450.00 $ 75.00 $ 100.00 $ 350.00 $ 600.00 $3,500.00 (5)* Zoning District Change 546.07 $ 500.00 (b)* Subdivision Approval 500.01-500.05 $ 500.00 Subdivision Waiver 500.05-Subd.2 $ 350.00 * Any additional expense of notification necessitated by applicants request for continuance will be charged to the applicant. (7) Off-street Parking Permit 541.07 (a) As part of conditional use permit process No Fee 800.15-800.23 (8) Street Vacation 820 (9) Conditional Activity Permit 521.103 (10) Nonconforming Use Permit 521.105 (11)Appeal to Board of Adj. & Appeals (12) Special Request to City Council (b) In conjunction with permitted use $ 300.00 $ 350.00 $ 300.00 $ 400.00 $ 350.00 $ 350.00 D-4 SECTION 4. ZONING, LAND USE AND RELATED CHARGES (CONTINUED) TYPE OF PERMIT SECTION OR LICENSE REQUIRING DESCRIPTION (13)Zoning Compliance Letter (14) Comprehensive Plan Amend. (15) Home Occupation Permit (16) Plat: preliminary 8~ final SECTION 5. PUBLIC WORKS FEES TYPE OF PERMIT SECTION OR LICENSE REQUIRING (1) Benches 805.01-805.27 (2) Boulevard feature 81 1.07 Permit (3) Excavation in 800.01-800.15 Public Right of way (4) Forestry Permit 810 (5) Seasonal Load Limit Exemption (b) Utility 700.05 Abandonment 710.01 (7) Certification Charge 705.03-705.21 (8)(a) Sewer 700.05 Construction (b) Water Service 715.01 Service Connection SECTION 6. FIRE SERVICES FEES TYPE OF PERMIT SECTION OR LICENSE REQUIRING (1) Fire 400.21-400.29 Prevention Code (2) Daycare/Adult Foster Care Facility Inspection (3) Reimbursement Fee for Fire/Rescue Unit (4) Fire Report DESCRIPTION First Year Renewal (a) Application to place a privately owned feature in the boulevard For each transverse excavation and each 100 feet or portion thereof longitudinal excavation and for each curb and gutter section installed or driveway apron installed, except when survey and grade stakes are set by City FEE $ 50.00 $ 350.00 $ 25.00 $ 500.00 FEE $ 80.00 $ 55.00 $ 25.00 $ 125.00 $ 20.00 Per load $ 25.00 (a) Sewer (b) Water (Delinquent) Residential Industrial/Commercial As per Ordinance - To connect to existing water service leads at the curb box To connect to main where a curb box and service lead is not installed the fee is the actual cost of material and estimated cost of labor. To turn on water after discontinuance of service For raising or lowering stop-box tops to correspond with ground level change made by property owner. Cost plus 66% material and labor. $ 50.00 $ 50.00 $ 50.00 $ 50.00 $ 100.00 $ 50.00 $ 50.00 DESCRIPTION FEE For initial fee required under code Per year $ 50.00 For each additional fee required under code Per year $ 10.00 Penalty If not renewed within 2 months of notification $ 25.00 $ 50.00 Per Hour $ 150.00 Per copy $ 5.00 D-5 SECTION 7. AMUSEMENT AND RECREATION LICENSES AND PERMITS TYPE OF PERMIT SECTION OR LICENSE REQUIRING DESCRIPTION (1) Arcade 1 105 (2) Amusement Device 1100.01 (3) Lawful Gambling 1 100.13 (4) Itinerant Place 1 100.05-1 100.1 1 of Amusement (5) Public Dance 1110.03 (b) General 1100.03 Amusement (a) Mechanical Amusement Device (Pinball) (b) Mechanical Music Box (c) Video Games Bingo, Tipboard, Paddle Wheel, Raffle, Pull Tabs (a) Lawful Gambling Permit (those exempt from State Licensure) (State Statute 349.213) (b) Lawful Gambling Investigative Fee (State Statute 349.16) STATE LICENSE REQUIRED For each day dances are held - $2 No fee for locations holding tavern licenses. (a) Billiard, Pool or Pigeonhole table (each) 1. Coin operated (b) Bowling Alley (per lane) (c) Circus (d) Dance Hall (e) Golf 1. Miniature 2. Driving Tee (f) Mountback (g) Rides, mechanical/animal of any kind (ea) (h) Shows, any kind (i) Shuffleboard (each lane) (j) Other games (7) Musical Concert 1 1 10.01 (8) Theatre Cinema 1 120 (9) Roller Rink 1 1 15 (10) Commercial Adult- 605 Oriented Enterprises (1 1) Masseur/Masseuse 605 (12) Public Baths 610 Per event Plus a notice publication fee 1 year or portion thereof Investigation fee Certificate fee Investigation fee Investigation fee (actual cost minimum) (13) Fortune Teller 1 130.05-1 130.07 and related trade (14) Adult Establishments 1 196 Annual license Investigation fee (new license) FEE 1 Year $ 345.00 1 Year $ 15.00 1 Year $ 15.00 1 Year $ 15.00 1 year $ 100.00 1 year $ 100.00 1 day $ 184.00 1 month $ 30.00 1 year $ 15.00 1 year $ 15.00 1 year $ 30.00 1 year $ 150.00 1 day $ 150.00 1 year $ 35.00 1 year $ 35.00 1 day $ 143.00 1 year $ 15.00 1 day $ 143.00 1 year $ 16.00 1 day $ 15.00 $ 30.00 1 year $ 143.00 $ 6.50 $ 143.00 1 year $1,725.00 1 Year $1,725.00 1 year $ 58.00 1 year $ 143.00 1 year $1,998.00 $1,998.00 1 day $ 115.00 1 week $ 345.00 1 month $ 690.00 1 year $1,150.00 1 year $1,725.00 $1,725.00 D-6 SECTION 8. ANIMAL LICENSES AND PERMITS TYPE OF PERMIT SECTION OR LICENSE REQUIRING DESCRIPTION ' (1) Animals 905.01-905.29 (a) Animals (Spayed or Neutered) with option to purchase amulti-year license (b) Animals (Not Spayed or Neutered) (c) Duplicate Animal License (d) Late Penalty 905.31-905.33 (e) Commercial Kennel (f) Residential Kennel (g) Veterinary 905.37-905.39 (h) Pigeons 905.41 (i) Non-domestic Animals (Temporary Permit) 905.01-905.29 (j) Impounding (each animal) 1st time 2nd Time 3rd time (each impound after) SECTION 9. VEHICLE AND TRANSPORTATION LICENSE AND PERMIT FEES TYPE OF PERMIT SECTION OR LICENSE REQUIRING DESCRIPTION (1) Bicycle 1335 Minnesota State Registration (2) Aircraft 1340 (3) Food Vehicle 615 (a) Bakery vehicle (4) Garbage and Refuse Collection 601.01-601.33 (5) Motor Vehicle (b) Catering -for first food vehicle Second vehicle Each additional vehicle (c) Readily perishable (Same as (b) above) Commercial and Residential First vehicle Each additional vehicle Dealer 1 155 Per place of business Each additional place of business (b) Motor Bicycle Business 1 160 Per place of business Per place of business to sell, rent or lease (7) Sound Truck 1 165 Per vehicle Per vehicle (8) Taxicab 1 170 First vehicle or auto livery Each additional vehicle or auto livery operated at any time within license period (9) Taxicab Driver 1 175 (10) Rental or Utility 1 185 Trailers and Trucks Each place of business FEE 1 year $ 13.00 1 year $ 15.00 $ 7.00 $ 6.00 1 year $ 173.00 1 year $ 132.00 $ 173.00 I year $ 35.00 $ 23.00 $ 50.00 $ 100.00 $ 150.00 FEE 1 day $ 35.00 1 year $ 87.00 1 year $184.00 1 year $ 75.00 1 year $ 41.00 1 year 1 year 1 year 1 year 1 year 1 year 1 year 1 day 1 year 1 year 1 year $173.00 $ 37.00 $259.00 $ 98.00 $149.00 $ 69.00 $149.00 $ 23.00 $374.00 $ 46.00 $ 35.00 1 year $ 69.00 D-7 SECTION 10. COMMERCIAL BUSINESS AND TRADE LICENSES AND PERMITS TYPE OF PERMIT SECTION OR LICENSE REQUIRING DESCRIPTION FEE (1) Firearms Dealer 920.01-920.05 1 year $1,150.00 (2) Itinerant Food 615 Establishment 1 year $ 92.00 (3) Retail Candy 615 First facility 1 year $ 92.00 Shop Each additional on same premises 1 year $ 23.00 (4) Food Establishment 615 (a) Retail or Wholesale Food Sales (Grocery) 1 year $ 242.00 (5) Vending Machine 615 (b) Automobile Washing Establishment 1125 (7) Scavenger 600.25 (8) Incinerator (9) Tobacco 600.01-600.23 1 146.01(MS 461.12) (10) Soft drink (1 1) Transient Merchant (12) Wagon Peddler (13) State hawker or Peddler license (14) .Canvasser or Solicitor (b) Restaurant (Prepackaged food only sold for consumption) 1 year $ 242.00 (c) Restaurant (Prepared food sold for consumption) 1 year $ 455.00 (d) Plan Review Fees: See fee schedule at end of Section 10 (e) Additional Food Facilities (Baked goods, meat, produce, microwave ovens) Each $ 30.00 (a) Food vending machine requiring coin or token (excepting those machines dispensing bottled or canned soft drinks) 1 year $ 15.00 (b) Other food vending machines (excepting those dispensing bottled or canned soft drinks) 1 year $ 15.00 (c) Ice vending machine 1 year $ 15.00 Per calendar year or fraction thereof $ 115.00 Each vehicle 1 year $ 35.00 Permit fee for opening cesspool or dumping contents of each cesspool into City sewer $ 18.00 1 year $ 35.00 Retail Sale and Distribution -License issued on $ 288.00 calendar year (cigarette vending machines prohibited) (Bill No. 1998-19) 1 145.01 (a) Cans, bottles from shelf or cooler, fountain service $ 25.00 (b) Vending machine dispensing bottles or cans -0- (c) Other vending machines Per year or fraction thereof $ 25.00 Per each additional machine $ 25.00 1181.01-1181.09 1181 1181 1181 1 day $ 70.00 1 year $ 173.00 b month/per person covered 6 month/per person covered $ 40.00 $ 40.00 D-8 SECTION 10. COMMERCIAL BUSINESS AND TRADE LICENSES AND PERMITS (CONTINUED) TYPE OF PERMIT SECTION OR LICENSE REQUIRING DESCRIPTION FEE (15) Christmas Tree Sales 1 130.03 1 year $ 92.00 (16) Motel 1 190 First Unit $ 161.00 Per year each additional unit $ 11.00 (17) Outdoor Merchandising 1135 Permit $ 75.00 (18) Storage Enclosure 1 135 Per Enclosure $ 66.00 (19) Pawnbroker 1187 (a) Pawnbroker 1 year $3,000.00 (b) Owner investigation fee (nonrefundable) 1 year $1 ,725.00 (c) Manager investigation fee (nonrefundable) 1 year $ 625.00 (d) Employee investigation fee (nonrefundable) 1 year $ 60.00 (e) Transaction fee -per transaction $ 2.00 (20) Secondhand Goods Dealer 1 186 (aj Secondhand Goods Dealer 1 year $ 330.00 (b) Initial investigation fee (nonrefundable) $1 ,380.00 actual costs in excess of above with total not exceeding Applicant shall deposit $1200.00 with Licensing Clerk along with application. Amount in excess of actual application costs shall be refunded. (21) Auto Detailing 1195.01 Establishment (22) Tattoo, Body Piercing, 630 Body Painting or Body Branding (23) Temporary Tattoo, Body Piercing, Body 630 Branding and Body painting events (24) Massage 1188 Therapy Enterprise License (Business license) Massage Therapist License (Individual license) Temporary Massage Therapist License (25) Public Swimming 420.10 Pool License (a) Tattoo, body piercing, body painting or body branding (b) Initial investigation fee (nonrefundable) per booth Annual license Investigation fee (new license) Annual license Investigation fee (new license) Per temporary location 1st Pool Each Additional 1 year $ 259.00 1 year $ 575.00 1 year $1,725.00 $ 35.00 1 year $ 575.00 $ 575.00 1 year $ 58.00 $ 58.00 $ 115.00 $ 98.00 $ 52.00 D-9 SECTION 10. _COMMERCIAL BUSINESS AND TRADE LICENSES AND PERMITS (CONTINUEDI ,--. Class A (Fast Food) -Counter service only and/or drive through window and warehouses. Class B -Daycare, pet shops, retail candy, prepackaged food only. Class C -Small grocery/restaurants with four or less employees per shift and health clubs. Environmental plan review -includes the physical remodeling, updating, equipment replacement, equipment additions and the general overall review of all plans/work. This also includes all new development projects. New Construction Extensive Minor Remodel Non-remodel and/or Major Remodel (25- (0-24% of approval Remodel (over 50% 50% of facility) facility) consultation of facility involved) ($5,000 or less in Class A (large $1836 $956 $516 costs $gg restaurant or roce Class A (fast food and $1264 $692 $384 $8g warehouses Class C (food facilities $692 $384 $230 $gg with 4 or less employees per shift and health clubs Class B (daycares, $340 $132 $66 No fee grocery, pet shops, retail cand Class B (prepackaged New project or Minor remodel - food only) change of owner - permit but no $88 Ian check fee Thera eutic Massa a $88 $88 $88 $88 Lod in $1528 $824 $428 $88 PLAN REVIEW FEE FOR FOOD, THERAPEUTIC MASSAGE AND LODGING PERCENTAGE OF FACILITY INVOLVED WILL BE DETERMINED BY STAFF Definitions: Class A -Large restaurant or large grocery store that employs more than four people per shift, and/or has multiple supplemental licenses (i.e., bar, bakery, deli, meat department, etc.) SECTION 11. LIQUOR AND RELATED LICENSE AND PERMIT FEES TYPE OF PERMIT SECTION OR LICENSE REQUIRING DESCRIPTION (1) Nonintoxicating Malt Liquor (2) Liquor (3) Employee License On-Sale Liquor Establishments 1210 (a) On-Sale (b) Tavern (dance) (c) Wholesale (d) Off-Sale (e) Club (Bottle Club) 1200.01-1200.25, 1200.29-1200.39 (a) On-Sale 1215 (b) Sunday (Fee set by state law) 1225 (c) Wine 1200.01-1200.25 (d) Veterans' Organization (Ex-Sunday) 1200.29-1200.39 1200.01-1200.25, Effective 10/1 /95 all licenses issued shall be valid 1200.29-1200.39 for a period of two years from the date of initial application FEE 1 year $ 633.00 1 year $ 518.00 1 year $ 25.00 1 year $ 184.00 1 year $ 420.00 1 year $11,200.00 1 year $ 200.00 1 year $ 920.00 I year $ 600.00 $ 25.00 D-10 SECTION_11. LIQUOR AND RELATED LICENSE AND PERMIT FEES (CONTINUED) TYPE OF PERMIT SECTION OR LICENSE = REQUIRING DESCRIPTION FEE ,- ~ (4) Investigation 1200.01-1200.25, (a) On-Sale liauor including Veterans' Organization Fee 1200.29-1200.39 each person shown on application $575.00 and actual costs in excess of above. Each additional investigation for each person not listed on original or renewal application. $ 173 00 1225 (b) Wine - Original Application initial Fee . $317.00 and actual costs in excess of above with total fee not to exceed $2,423.00 Renewal Application Initial Fee $71.00 and actual costs in excess of above with total cost not to exceed $2,423.00 1200.09 Additional Investigation under 1200.09 Subd. 3 $143.00 and not to exceed $2,423.00 Investigation of substitute manager $ 72.00 SECTION 12. HOUSING INSPECTION AND RENTAL LICENSE FEES TYPE OF PERMIT SECTION OR LICENSE REQUIRING DESCRIPTION FEE (1) License for 405 (a) Apartment House (includes first 4 Units) 1 year $69 00 Apartment Houses each additional unit in excess of 4 . $10 00 and Rental Homes . (b) Rental Home -single family dwelling 1 year $69.00 (c) Duplexes/double bungalows, triples and quads `~ First unit 1 year Each additional rental unit 1 year $69.00 $25.00 (d) Late Fee 10% penalty for each month or portion thereof during which said fee remains unpaid. (e) License Transfer Fee $10.00 (f) Reinstatement of suspended license 50% of license fee (g) Reinstatement of Revoked license 100% of license fee (h) Re-Inspection Fee $81.00 ea. Inspection over standard 3 inspections (i) Provisional license for apartment house 1 year $160.00 Includes 1 - 4 units Each additional unit in excess of 4 $18.00 (2) Certificate of 405.26 Housing maintenance Single family home or owner/occupied Compliance portion of a 2-family home $69.00 (3) Permit Fee for Rooming House 405.19 1 year $87.00 D-11 SECTION 13 - M TYPE OF PERMIT OR LICENSE ~~ (1) Permit to reside (2) Permit to Carry a Gun ISCELLANEOUS FEES SECTION REQUIRING DESCRIPTION 1 190 In motel for more than six months Mn Uniform Crime Bill Processing Fee Chapt 636 Article 3 (3) Antenna 426 Commercial Wireless Telecommunication Service (CWTS) (4) False Alarms (billable) (5) Copying Services Provided FEE $16.00 $10.00 $75.00 $25.00 $100.00 $200.00 $ .25 x (per side) 11 x 17 (each) $ 25 24 x 36 (each) $ .50 $ 1.00 X-large $ 2.00 (b) Labor hourly wage & 33% (c) Postage prevailing rate (d) Assessing Assessing Search $ 12.00 Assessing Printout $ 3.00 (e) Fax per page $ .50 (f) Audio tape of meeting (per tape) $ 5.00 (g) Video tape of meeting (per tape) $ 15.00 (a) CWTS antenna permit application fee (b) Antenna permit fee for additional antennas added to an existing antenna location (a) in excess of 2 for calendar year (b) in excess of 10 for calendar year Flat rate (per page) Special rate (a) Photocopy rate 85 11 Passed by the City Council of the City of Richfield this 10th day of December, 2002. ATTEST: Nancy Gibbs Martin J. Kirsch Mayor City Clerk D-12 AGENDA SECTION: ~r0~~~ ~rc~~fia.nCe AGENDA ITEM # REPORT # ~j ~ STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 BRUCE SYLVESTER, COMMUNITY DEVELOPMENT DEPARTMENT REPORT PREPARED BY: AND BETSY CHRISTENSEN, PUBLIC SAFETY DEPARTMENT NAME, T/TLE BRUCE PALMBORG, REPORT PRESENTER: DIRECTOR OF COMMUNITY DEVELOPMENT NAnar_, Tire 1; DEPARTMENT DIRECTOR REVIEW: SIGNATURE `~ - REVIEWED BY CITY MANAGER: ~ ~~~ , ~~, _ ; ITEM FOR COUNCIL CONSIDERATION: Second reading of an ordinance amendment to Richfield City Code to create Section 325 for the Administrative Hearing Enforcement Program and consideration of a resolution approving the summary legal .notice for the ordinance amendment creating the new Administrative Hearing Enforcement Program. I. RECOMMENDED ACTION: By motion: Approve the second reading of the attached ordinance amendment to the Richfield City Code to create Section 325 for the Administrative Hearing Enforcement Program and adopt the attached resolution approving the summary publication of the ordinance amendment creating Section 325, Administrative Hearing Enforcement Program. I. BACKGROUND Staff from the Public Safety Department and the Community Development Department have been working to create procedures to assist the City in enforcing City Codes. While criminal fines and penalties have been the most frequent 1210-325-2ndReading enforcement mechanism for chronic violations, there are certain negative consequences for both the City and the accused, including: the delay inherent in the system does not ensure prompt resolution; citizens resent being labeled as criminals for violations of administrative regulations; the higher burden of proof and the potential of incarceration do not appear appropriate for most administrative violations; and the criminal process does not always regard City Code violations as being important. Therefore, there is a need for alternative methods for enforcing the City Code. Accordingly, staff has drafted an enforcement procedure using administrative citations and the imposition of civil penalties as an alternative method of enforcement. This- method of enforcement would be in addition to any other legal remedy that may be pursued for City Code violations. Typical violations which will be addressed through the administrative. hearing enforcement procedure include environmental health division violations regarding animals, fences, garbage, noise, parking, and property maintenance issues, and zoning violations regarding accessory uses, home occupations, and violations of any stipulations attached to conditional use permits. The administrative hearing enforcement procedure would. be as follows: violators will receive two letters informing them of the violation and providing them with time to correct it. Only after receiving two such letters would an administrative citation be issued. The citation would cite the violation and charge a fee. Violators would have the option of either correcting the violation and paying the fee, or requesting a hearing with a hearing officer to contest the citation and/or the fee. If the violator corrects the problems and pays the fine, then the process is finished. If the violator chooses to contest the charge and/or the fine, then he or she would request a hearing with a hearing officer. The City will establish a group of hearing officers that will be available to hear cases and make decisions. These officers will. need to meet minimum requirements to be included in the pool of officers, and they will be paid a flat fee for each hearing over which they preside. After a violator has requested a hearing, a date will be sef and a hearing officer will be selected from a pool of officers established by the-City Council.: Violators will be informed- of the date and time of the hearing, as well as the identity of the designated hearing officer. Violators will have one opportunity to contest the appointment of a hearing officer, if the violator feels that the selected officer will not be impartial. The violator will only have this option once-any subsequently designated hearing. officer will decide if they are able to impartially hear the case. Violators will not be allowed to contact officers directly prior to a hearing. Aftera hearing officer has been designated, and prior to the hearing, City staff will provide the hearing officer with the case file containing details about the code violation, including dates, locations, and the specific. nature of the violation. The case file will also include copies of the two warning letters that were sent out prior to the issuance of the citation. At the- hearing, the violator will be given the opportunity to explain why they should not be required to comply with City Codes and/or pay the fine that was issued with the citation. Violators may bring witnesses and may have-legal counsel,-but representation by a lawyer will be discouraged to keep he proceedings as informal as possible. They will be allowed to attend- the hearing, but only to give advice to their clients. City staff will also be available to provide. information at the hearing. The hearing officer will not make a decision at the hearing itself, but will instead close the hearing and notify City staff and the violator, in writing, of their decision within 10 days. If the hearing officer dismisses the charges and/or fine, then the case is done. If the hearing officer maintains the charge and/or fine, the violator must then comply with the requirement to fix the problem and pay the fine. Decisions of the hearing officer may not be appealed to the City Council, but instead. can only be appealed to the court of relevant jurisdiction as provided by state law. Failure to comply with the decision of the hearing officer could result in the City using the formal complaint process through the court system [Note: this process is the one currently used by the City.] The City will also be able to collect unpaid fines through a special assessment levied against the property owner's property taxes. Regarding the summary publication resolution, Chapter 3.12 of the Richfield City Charter authorizes the City to publish an ordinance by title and summary in certain circumstances. The primary circumstance where such a summary publication is intended is for lengthy ordinances, which would require costly publication charges. Such publications are not deemed cost effective. In order to forego the publication of the entire ordinance, the City Council must determine that a summary of the ordinance would clearly inform the public of the intent and effect of the ordinance. The summary must then be approved by a City Council resolution. The ordinance creating the new Administrative Hearing Enforcement Program to be considered by the Council on December 10, 2002 is an example of an ordinance that could be summarized rather than published in its entirety. Therefore, a resolution and ordinance summary have been prepared for City Council consideration. II. -BASIS OF RECOMMENDATION A. POLICY • The City Council has directed staff to prepare methods for obtaining compliance with city codes other than through use of the court system. • At the October 22, 2002 City Council Worksession the Administrative Hearing Enforcement Program was reviewed and staff was directed to schedule the proposed ordinance for City Council consideration. • The City Charter was amended on January 8, 2002 to allow the creation of this Administrative Hearing Enforcement Program. • First reading of the proposed ordinance was approved on November 12, 2002. ..The City uses Charter authority to publish ordinance summaries where such summary publications meet the requirements of the Charter. B. CRITICAL ISSUES • The proposed fee schedule is attached to this Staff Report. • The City Attorney and staff from the Public Safety Department and Community Development Department will establish a pool of Hearing Officers in early 2003 using the following procedure: an ad will be placed in the Minnesota Lawyer publication requesting interested lawyers to contact the City; interested attorneys must submit a resume and resumes will be reviewed by the City Attorney and City staff from the Public Safety and Community Development Department; and qualified lawyers will be included on the Hearing Officer pool. This procedure to establish a pool of Hearing Officers has been used successfully by other cities. • The summary publication resolution indicates availability of the complete ordinance. C. FINANCIAL -_~ • All fines received through the Administrative Hearing Enforcement Program are retained entirely by the City of Richfield rather than a "shared" situation with Hennepin County District Court through the current formal complaint situation. • The summary publication will cost $42.90 to publish, versus $403.97 for the complete publication, for a cost savings to the City of $361.07. D. LEGAL • Richfield's City Attorney has reviewed and approved the attached ordinance amendment. • ..The authority to do summary publications:is provided in the Richfield City Charter: Section 3.12, Manner of Publication of Ordinances. If the City Council determines that publication of the complete text of an ordinance is not worth the expense and that a summary would clearly inform the public of the intent and effect"of the ordinance, the Council may by a unanimous vote direct that only the title of the ordinance and a summary be published with notice that printed- copies of the ordinance are available to any person during regular office hours at the office of the City Clerk and any other location which the Council designates. Prior to the publication of the title and summary, the Council shall. approve the text of the summary and determine'that it clearly informs the public of the intent and effect of the ordinance. (Amended Bill 1981-33). • Legal counsel fias opined that the summaries meet Charter requirements. III ALTERNATIVE RECOMMENDATION(S) ~ The Council could decide to ~e~ect the recommendation to amend Richfield City Code to create Section 325 for the Administrative Hearing Enforcement Program. This would mean that the current formal complaint system used through Hennepin County District Court would continue to be used and delays would continue to occur in resolving property maintenance and zoning violation issues. Rejecf the summary publication and require the full ordinance be published. IV ATTACHMENTS I • .Ordinance Amendment Proposed Fee Schedule for violations of City Codes Resolution approving. the summary: publication of the new Administrative Enforcement Program V PRINCIPAL PARTIES EXPECTED AT MEETING ~ None. BILL NO. AN ORDINANCE RELATING TO THE ADMINISTRATIVE ENFORCEMENT PROGRAM; ADDING SECTION 325 TO THE RICHFIELD CITY CODE THE CITY OF RICHFIELD DOES ORDAIN: Section 1. Section 325 of the Richfield City Code is amended by adding a section to read as follows: Section 325 -Administrative Enforcement Program 325.01. Administrative citations and civil penalties. Sections 325.15 through 325.35 govern administrative citations and civil penalties for violations of the city code. 325.05. Purpose. The City Council finds that there is 'a need for alternative methods of enforcing the city code. While criminal fines and penalties have been the most frequent enforcement mechanism;. there are certain negative consequences for both the city and the accused. The delay .inherent in thaf system. does not ensure prompt resolution. Citizens resent being. labeled as criminals for violations of administrative regulations. The higher burden of proof and the potential of incarceration do not appear appropriate .for most administrative violations. The criminal process does not always regard city code violations as being important. Accordingly, the City Council finds that the use of administrative citations and the imposition of civil penalties is a legitimate and necessary alternative method of enforcement. This method of enforcement is in addition to any other. legal remedy that may be pursued for city. code violations. 325.10. General provisions. Subdivision 1. Administrative offense. A violation of any.'. provision of .the city code is an administrative offense that may be subject. to an administrative citation and civil penalties. Each day a violation exists constitutes a separate. offense. Subd. 2. Exemption. Alcohol and tobacco license violations, and motor vehicle violations are not subject to administrative citation under this ordinance. Subd. 3. Civil penalty. An administrative offense may be subject to a civil penalty not to exceed the maximum penalty for a misdemeanor violation understate law. Subd. 4. Schedule of fines and fees. The City Council must adopt by resolution a schedule of fines for offenses initiated by administrative citation. The- City Council may adopt a schedule of fees to be paid to administrative hearing officers. Subd. 5. Procedures. The city manager. must adopt procedures for administering the administrative citation program. r=~, 325.15. Administrative citation procedures. Subdivision 1. Administrative Notice. Any person authorized to enforce provisions of the city code may issue an administrative order to correct condition or administrative citation upon belief that a code violation has occurred. (a) After the first violation, the city will deliver to the violator, either in person or by mail, the First Administrative Order to Correct Condition. The violator will have - ~. seven (7) days to correct the violation after issuance of the First Administrative Order to Correct Condition. (b) After the second violation involving the same offense, the City will issue to the violator, either in person or by mail, the Second Administrative Order to Correct Condition. The violator will have seven (7) days to correct the violation after issuance of the Second Administrative Order to Correct Condition. Subd. 2. Citation. If the violator fails to correct the violation within the time period provided in the Second Administrative Order to Correct Condition, the City may issue an administrative citation. The City must issue the citation to the violator in person or by mail. The citation must. state the date, time, and nature of the offense, the name of the issuing officer, the amount of the scheduled fine, and the manner for paying the fine or appealing the citation. Subd. 3. Payment. The person responsible for the violation must either pay the scheduled fine or request a hearing within 14 days after issuance. Penalties for failure to correct the violation or late payment of the fine may be imposed: as set forth in section 325.30, subdivision 4. The city may issue a second citation or take other legal action to achieve compliance with the ordinances. 325.20. Administrative hearing. Subdivision 1. Hearing officers. The City Council will periodically approve a list. of lawyers, from which the city clerk wil( randomly select a hearing officer to hear and determine a matter for which a hearing is requested. .The hearing officer will be a public officer as defined by Minnesota Statutes, Section 609:415. The hearing officer must not be a city employee. The city manager or their designee must establish a procedure for evaluating. the competency of the. hearing: officers, including comments from accused violators and city staff. These reports must be provided to the City Council. Subd. 2. Notice of hearing. Within 10 days of the request for a hearing, the city clerk will schedule the hearing and will notify the violator of the date, time and place for the hearing. Parties are expected to be available for two hours. Notice of the hearing must be mailed to the violator or the property- owner, if different from the violator, and- the hearing officer at least ten days in advance of the scheduled hearing, unless a shorter time is_ accepted by all parties. The notice- must contain the -names of the violator. or property owner, the identity of the hearing officer, the location of the alleged violation and the type of alleged violation. Subd. 3. Removal of hearin oc~ fficer. No later than five days before the date of the hearing, the violator may make a written request that the assigned .hearing officer be removed from the case. The city clerk will automatically grant one request for removal. A subsequent request must be directed to the assigned hearing officer who will decide whether they can fairly and objectively review the case. If the hearing officer determines they cannot fairly and objectively review the case, the hearing officer shall notify the city clerk in writing at least one day before the scheduled hearing date. The city clerk will then assign another hearing officer. Subd. 4. Continuance. A request for a continuance must be made to the city clerk at least five days prior to the scheduled date. Continuances will be granted only for good '` , cause shown and for no more than ten days from the originally assigned date. Subd. 5. File transmittal. Upon receipt of any request for a hearing the Public Safety Director or their designee will compile a -file on each case consisting of the following: (a) copy of the citation issues; (b) copies of the two Administrative Orders to Correct Conditions, which preceded the citation (one copy for each of the two orders); (c) copy of any case history in the issuing. employee's department; (d) photographs and/or videotape of property where available; (e) supplemental report detailing the facts in support of any determination that the offense constitutes a serious threat of harm to the public health, safety, or welfare; and (f) proof of mailing and/or posting of notice on the property if citation was not personally served on the violator. The file must be ready for the. hearing officer to pick up on the business day preceding the scheduled hearing.. Subd. 6. Presentation of case. At the hearing, the parties will have the opportunity to present testimony and question any witnesses, but strict rules of evidence will not apply. The hearing-officer must tape record the hearing and may receive testimony and exhibits. The .officer must receive and give weight to evidence,. including hearsay evidence, that possesses probative value. commonly accepted by reasonable and prudent people in the conduct of their affairs. Subd. 7. Decision. (a) .The decision of the hearing officer must be in writing and contain findings of fact, conclusions of law and an order. The decision will be mailed to the parties within ten days after the hearing. The hearing officer has the authority to determine that a violation occurred, to dismiss a citation, to impose the scheduled fine; or to reduce, stay, or waive a scheduled fine either unconditionally or upon compliance with appropriate conditions. When imposing a penalty for a violation, the hearing officer may consider any or all of the following factors: (1) the duration of the violation; (2) the frequency or reoccurrence of the violation; (3) the seriousness of the violation; (4) the history of the violation; (5) the violator's conduct after issuance of the Administrative Orders to Correct Conditions; (6) the violator's conduct after issuance of the notice of hearing; (7) the good faith effort by the violator to comply; (8) the impact of the violation upon the community; (9) prior record of city code violations; and (10) any other factors appropriate to a just result. (b) The hearing officer may not impose a fine greater than the established fine, except that the hearing officer may impose afine -for each week that the violation continues if: (i) the violation caused a serious threat of harm to the public health, safety, or welfare as determined by the hearing officer or that (ii) the violator intentionally and unreasonably refused to comply with the code requirement. (c) The hearing officer's decision and supporting reasons must be in writing. Subd. 8. Decision. Except as provided in section 325.25 the decision of the hearing officer is final without any further right of appeal. Subd. 9. Failure to appear. The failure to attend the hearing constitutes a waiver of the violator's rights to an administrative hearing and an admission of the violation. A hearing officer .may waive this result upon good cause shown. "Good cause" is limited to: death in the immediate family or documented incapacitating illness of the accused; a court order requiring the accused to appear for another hearing at the same time; and lack of proper service of the citation or notice of the hearing. 325.25. Judicial review. An aggrieved party may obtain judicial review of the decision of the hearing officer as provided in state law. 325.30. Recovery of civil penalties. Subdivision 1. Non-payment. If a civil penalty is not paid within the time specified, it will constitute: (a) alien on the real property upon which the violation occurred if the property or improvements on the property was the subject of the violation; or (b) a personal obligation of the violator in all other situations. Subd. 2. Lien. Alien may be assessed against the property and collected in the same manner as taxes. Subd. 3. Personal obligation. A personal obligation may be collected by appropriate legal means. Subd. 4. Late Fees/Charges. (a) The fine will increase by 10% for each week, starting 10 days after the citation was issued, that no action is taken to correct the violation. (b) If payment arrives more than one week after it was due, an additional 10% of the fine may be assessed, together with interest, for each seven-day period, or part thereof, that the fine remains unpaid after the due date. Subd. 5. Unpaid civil penalty. During the. time that a civil penalty remains unpaid, the provisions of city code, section 1005 apply to a license, permit, or other city approval sought by the violator or for property under the violator's ownership or control. Subd. 6. License revocation or suspension. Failure to pay a fine is grounds for suspending or revoking a license or permit related to the violation. 325.35. Criminal- penalties. The following are misdemeanors, punishable in accordance with state law: (a) Failure, without good cause, to pay a fine or request a hearing within 10 days after issuance of an administrative citation; (b) Failure, without good cause, to appear at a hearing that was scheduled under section 325.20; (c) Failure to pay a fine imposed by a hearing officer within 10 days after it was imposed, or such other time as may be established by the hearing officer. If the final adjudication in-the administrative penalty procedure is a finding of no violation, then the city may not prosecute a criminal violation in district court based on the same set of facts. This does no# preclude the city from pursuing a criminal conviction for a violation of the same .provisions based on a different set of facts. A different date of violation will constitute a different set of facts. Passed by the City Council of the City of Richfield, Minnesota this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk CITY OF RICHFIELD VIOLATION/FINE SCHEDULE ANIMALS 905.03 Failure to license animal $50.00 905.05 Failure to restrain do $50.00 905.06 Failure to dis ose of animal feces $50.00 930.15 Animal anno ance b reason of noise $50.00 905.17 Failure to uarantine animal $100.00 905.19 Failure to comply with potentially or dangerous dog re uirements $250.00 905.31 Failure to obtain commercial kennel license, multi-animal residential license or veterina kennel license $50.00 905.29 Abandonment of an animal $100.00 Failure to rovide shelter, food or water for a domestic animal $250.00 2005.03 Cruelty to animals and birds $250.00 BUILDING CODE 400.19 Failure to number houses and buildin s $50.00: 405.09 Failure to provide. minimum standards for basic equipment and facilities $100.00 405.11 Failure to provide minimum standards for light, ventilation and heatin $100.00 405.13 Failure to provide minimum standards for safe. and sanitary maintenance of dwellin s/dwellin units $100.00 405.15 Failure to rovide minimums ace $100.00 406.01 Failure to license rooming house $100.00 407.00 Failure to license a artment houses and rental homes $100.00 407.09 Failure to dis la license or rovide tenant re ister $100.00 408.01 Failure to obtain certificate of housing maintenance com liance POS $100.00 420 Failure to com I -with swimmin ool ordinance $100.00 BUSINESS LICENSES 1100.01 Failure. to obtain amusement devices license $50.00 1340.01 Failure to obtain aircraft license $50.00 1105.01 Failure to obtain arcade license.. $50.00' 1125.01 Failure: to obtain car washin license $50.00 1130.03 Failure to obtain Christmas tree license $50.00 605.05 Failure to obtain. commercial adult-oriented services license $50.00 1196.11 Failure to obtain an adult establishment license $50.00 1188.05 Failure to obtain a thera eutic massa a license $50.00 1195.03 Failure to obtain an auto detailin establishment license $50:00- 1200.03 Failure to obtain intoxicatin li uor license $50.00 BUSINESS LICENSES 850.09 Failure to obtain communit celebration license $50.00 1110.01 Failure to obtain concerts or dance license $50.00 615.05 Failure to obtain food establishment license $50.00 920.03 Failure to obtain firearms license $50.00 1130.05 Failure to obtain fortune teller license $50.00 601.15 Failure to obtain arba a and refuse collection license $50.00 1100.13 Failure to obtain lawful amblin license $50.00 1100.03 Failure to obtain eneral amusement license $50.00 1200.33 Failure to obtain a li uor em to ee license $50.00 1190.05 Failure to obtain motel license $50.00 1160.03 Failure to obtain motor bic cle license $50.00- 1155.05 Failure to obtain a State motor vehicle dealers license $50.00 1155.07 Failure to obtain a Ci motor vehicle dealers license $50.00 1120.03 Failure to obtain movie theatre license $50.00 1210.05 Failure to obtain 3.2 intoxicatin malt li uor license $50.00 1181.03 Failure to obtain transient merchant, peddlers, wagon peddlers and solicitors license $50.00 905.39 Failure to obtain i eon license $50.00 1186.05 Failure to obtain a awnbroker license $50.00 1187.05 Failure to obtain a secondhand oods dealer license $50.00 1215.03 Failure to obtain a license for Sunda alcohol. sales $50.00 610.03 Failure to obtain ublic bath license $50.00 1115.03 Failure to obtain roller rink license $50.00 601.33 Failure to obtain. scaven er license $50.00 1145.0.1 Failure to obtain soft drink license $50.00 1165.03 Failure to obtain sound truck license $50.00 1175.03 Failure to obtain taxi driver license $50.00 1170.03 .Failure to obtain taxi license $50.00 1146.05 Failure to obtain tobacco license $50.00 1185.01 Failure to obtain rental trailer and truck license. $50.00 1100.15 Failure to obtain video ame license $50.00 1225.03 Failure to obtain wine license $50.00 FENCES/WALLS/HEDGES 511.23 Failure to maintain fences/walls/hed es $100.00 FOOD ESTABLISHMENTS 615 Violations of food establishment ordinance $100.00 GARBAGE 601.03 Failure to dispose of garbage/refuse $50.00 601.09 Im ro er stora a and maintenance of arba a containers $50.00 601.35 Failure to com I with com ostin ordinance $50.00 LITTERING 830.03 Litterin $50.00 830.07 Placin litter into utters $50.00 830.31 Im ro er ostin of notices $50.00 830.41 Im ro er lacement of snow/ice $50.00 1135 Im ro er outdoor merchandisin and stora a $50.00 NOISE 930 Violations of the noise ordinance $50.00 PARKING 1305.19 Failure to comply with the "Vehicles for Sale" ordinance $50.00 1305.27 Failure to comply with parking ordinance for certain vehicles/trailers $50.00 1327.05 Failure to comply with parking of truck-tractors, semi-trailers, truck-tractor and semi-trailer combinations or trucks ordinance $50.00 PARKING: OUTSIDE°STORAGE 1320 Im ro er arkin or stora a $100.00 925 Maintainin .a ublic nuisance $50.00 - RECREATIONAL VEHICLES 1325 Im ro er arkin or stora a of recreational vehicles $50.00 SIGNS 416 Si n re ulations $100.00 TRANSIENT MERCHANTS, PEDDLERS, WAGON PEDDLERS AND SOLICITORS. 1181 Violation of transient merchant, peddler, wagon peddler and $50.00.. solicitor license- ZONING 511 General Zoning Provisions, including encroachments; non- $100.00 conforming. uses and structures; traffic. visibility triangles; central air conditioner units; home occupations; and fences, walls, ,and hedges. ZONING 521 Rules for the R, R-1, MR-1, MR-2, and MR-3 residential zoning $100.00 districts, including.. permitted, accessory, and. conditional uses; lot area, width, depth, and coverage requirements; set-back and height requirements; accessory building and use regulations, outdoor open space; parking requirements; performance standards; conditional activity permits; and non- conforming use permits. 524 Rules for the SO-1 Service-Office zoning district, including $100.00 permitted, accessory and conditional uses; lot area, width, depth, and coverage requirements; set-back and height requirements; accessory building and use regulations; and rules for conduct of business operations. 526 Rules for the C-1, C-2, and C-3 commercial zoning districts, $100.00 including permitted, accessory, .conditional and prohibited uses; lot area, width, depth, and coverage requirements; set- . back and height requirements; accessory building and use .regulations; rules for conduct of business operations. Also C-3 specific rules including transitional activity permits; non- conforming_uses and structures;. site plan approval; landscaping values; minimum floor-area ratios; solar access requirements; and maintenance, of landscaping. 531 Rules for the I industrial zoning district, including permitted, $100.00 accessory and conditional uses; lot area, width, depth and coverage requirements; set-back and height requirements; accessory building and use regulations; and rules for the conduct of business operations. 536 Rules for PUD planned unit development zoning districts $100.00. including requirements for unified control; integrated design; coordination with subdivision regulations; lot area; allowable uses; proposal review and application; final development plans and conditional use permits; amendments}, and fees. 538 Floodplain Management Regulations including permitted uses $100.00 in floodplain overlay districts; floodplain use permits; and construction standards near or in floodplain overlay districts. 541 Performance standards for all new developments except single $100.00 family, two family, and cluster home developments, including exterior lighting; traffic/parking studies; off-street parking and loading;. landscaping and screening; underground utilities; exterior treatment of buildings; screening mechanical equipment; dumpster enclosures; and stormwater management. 546 Administration for the Board of Adjustments. and Appeals; $100.00 Conditional Use Permits; Zoning Amendments; Variances RESOLUTION NO. RESOLUTION AUTHORIZING SUMMARY PUBLICATION OF BILL NO.2002- WHEREAS, the City has adopted the above referenced amendment to the Richfield City Code at the December 10, 2002 City Council meeting; and WHEREAS, the verbatim text of the ordinance is cumbersome, and the expense of the publication of the complete text of the ordinance is not justified; and WHEREAS, the Council -has determined- that the following summary will clearly inform the public of the intent and effect of Bill No. 2002- NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Richfield, Minnesota that the city clerk shall cause the following summary of Bill No. 2002- to be published in the official newspaper in lieu of the entire ordinance: SUMMARY PUBLICATION BILL NO. -2002- AMENDMENT TO RICHFIELD CITY CODE; CREATION OF SECTION 325 The City Council has adopted Bill No. 2002- , an ordinance entitled "Administrative Hearing. Enforcement Program-Creation of Section 325." This summary of the ordinance is published pursuant to ,_ Section 3.12 of the Richfield City Charter. The purpose of this ordinance is to establish an enforcement procedure using administrative citations and the imposition of civil penalties as a method of enforcing city codes and regulations. This method of enforcement would be in addition to any other legal remedy that may be pursued for City Code violations. Copies. of the full text of the ordinance are available for public inspection in the City Clerk's office during normal business hours or upon request by calling 612-861-9760. Nancy Gibbs, City CIerK BE IT FURTHER RESOLVED, that the city clerk is directed to keep a 'copy of the ordinance in her office at city hall for public inspection and to post a full copy of the ordinance in a public place in the City for a period of two weeks. Adopted by the City Council of the City of Richfield, Minnesota this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk ~~ AGENDA SECTION: AGENDA ITEM # REPORT # J STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 ~~.hli~ GYIf~e S ~~~1~ REPORT PREPARED BY: NAME, TITLE REPORT PRESENTER: DEPARTMENT DIRECTOR REVIEW REVIEWED BY CITY MANAGER: BRUCE SYLVESTER, PLANNING c~ ZONING ADMINISTRATOR JOHN STARK, COMMUNITY DEVELOPMENT MANAGER NAME, TITLE SIGNATURE ~~ ITEM FOR COUNCIL CONSIDERATION: Public hearing and consideration of a request for an amendment to a Planned Unit Development and a new Final Development Plan and Conditional Use Permit for amixed-use develo ment in the 7600 block between L ndale and Aldrich Avenues. I. RECOMMENDED ACTION: Conduct and close a public hearing and by motion: Approve the requested amendment to a Planned Unit Development and the new Final Development Plan and Conditional Use Permit for amixed-use development in the 7600 block between Lyndale and Aldrich Avenues, with those stipulations listed in the Legal section of the Basis of Recommendation. II. BACKGROUND The City Council approved a planned unit development (PUD) plan and rezoning for the Lyndale Gateway development on September 13, 1999. The approved PUD called for amixed-use redevelopment on both the east and west sides of the 7600 block of Lyndale Avenue South. Phase I and Phase II of Lyndale Gateway were built in 2000: Phase I consists of Mainstreet Village senior housing and office space on the east side of Lyndale, 1210-LyndaleGateway-FDP-CU P while Phase II consists of the Casteel Place townhouses in the 7600 block of Garfield, just east of Lyndale. On February 14, 2000, the CSM Corporation received City Council approval for a Final Development Plan (FDP) and Conditional Use Permit (CUP) for Phase III of the Lyndale Gateway development, to be known as Lyndale Gateway West. The approved CSM Corporation FDP and CUP for Lyndale Gateway West called for a commercial/retail development, anchored by a Walgreens, in the one-block area bounded by 76th and 77th Streets and Lyndale and Aldrich Avenues. The CSM Corporation was unable to secure the necessary commitments to begin construction of Lyndale Gateway West. In May 2001 the Housing and Redevelopment Authority (HRA) terminated CSM's development rights for Lyndale Gateway West and directed staff to seek another developer for the area. In December 2001, the HRA selected The Cornerstone Group to redevelop the west side of Lyndale Avenue with amixed-use development of commercial space and housing. The Cornerstone Group is now seeking approval for an amended PUD plan and a new FDP and CUP. The PUD is being amended because the original PUD plan called for only commercial/retail uses on the west side of Lyndale while the Cornerstone proposal calls for commercial and residential uses. The requested new FDP and CUP is for the specific proposal for a mixed commercial and residential development. The Cornerstone proposal for Lyndate Gateway West features: • 14 attached 2-story townhouses in three separate buildings fronting onto Aldrich Avenue, each with alower-level two-car garage accessed from the interior commercial parking area on the east side; • Two separate one-story free-standing commercial buildings on the south half of the block along Lyndale, at least one of which .will likely be a restaurant; • A 4 story mixed-use building on the north half of the block along Lyndale, with retail and office uses on the ground floor and residential (condominiums) above; • A 4 story residential (condominium) building on the west half of the block along 76th Street that `drops' to three stories along Aldrich Avenue; • An interior surface parking lot to support the commercial uses and an underground parking garage for use by the condominium owners; • Automobile access-to the development is provided from 76th and 77th Streets and Lyndale Avenue, while access to and from Aldrich is prohibited to protect the existing single-family homes on the west side of that street. Specifics of the proposal include: • Approximately 28,000 square feet of commercial space, including 8,000 square feet of restaurant and 20,000 square feet of office/retail space. This amount replaces the 47,500 square feet (approximate) of existing commercial space; • Approximately 127,500 square feet of residential space, including 14 townhouses and 92 condominium units. These units replace the existing seven single family homes and two apartment units; • 145 surface commercial parking spaces, 126 underground residential parking spaces, and 28 attached townhouse parking spaces (each townhouse has a two-car garage). The current/existing commercial uses are woefully underparked with a poor lot configuration, while the existing residential uses have private driveways and detached garages. Site Plan specifics: • Lot Area: 150,956 square feet (one city block) • Lot coverage-Buildings: 54,895 square feet (36%) • Lot coverage-Impervious surface: 136,116 square feet (90%) • Set-backs: Variable, from 3 feet to 20 feet • Heights: Variable, from 22 to 52 feet III. BASIS OF RECOMMENDATION A. POLICY • The Lyndale Gateway West redevelopment is consistent with the Comprehensive Plan designation of Community Commercial. The Community Commercial designation supports mixed-use development. • The Lyndale Gateway West redevelopment plan is consistent with The Lyndale Gateway: A Redevelopment Plan and Study, which is the guiding plan for this area. • .The Lyndale Gateway West redevelopment plan includes elements that are consistent with the following key themes from The Lyndale Gateway: A Redevelopment Plan and Study: buildings that address the street, pedestrian friendliness, and an appropriate transition from the commercial to the single family residential neighborhood. • This area has been identified for redevelopment since 1985. • The findings necessary to issue a CUP (546.05, subd.6) are as follows: a) The proposed use is consistent with the goals, policies, and objectives of the City's Comprehensive Plan. This requirement is met. The Comprehensive Plan calls for Community Commercial/Office uses at this location. b) The proposed use is consistent with any officially adopted redevelopment plans or urban design guidelines. The final development plan is consistent with The Lyndale Gateway: A Redevelopment Plan and Study. . c) The proposed use is or will be in compliance with the performance standards specified in Section 541 of this code. This requirement is met, as the proposal meets requirements outlined in Section 541 for matters such as off-street loading, underground utilities, exterior treatment of buildings, and dumpster enclosures. d) The proposed use will not have undue adverse impacts on '~` governmental facilities, utilities, services, or existing or proposed improvements. This requirement is met. Storm water, sewer, and traffic components of the development will all meet city requirements as determined by the Public Works Department. e) The use will not have undue adverse impacts on the public health, safety, or welfare. This requirement is met. f) There is a public need for such use at the proposed location. This requirement is met. The existing uses are obsolete and in poor repair. The majority of parking is provided on City right-of-way that will be needed for road improvements in the future. The redevelopment area is truly a `gateway' into. Richfield from the south and #rom I-494. Redeveloping the area will° increase the tax base for the community and improve the `first impression' people have as they enter Richfield` on Lyndale. g) The proposed use meets or will meet-all.-the specific conditions set by this code for the granting of such conditional use permit. This proposed use meets all specific requirements as outlined in section 536.19. B. CRITICAL ISSUES, • Zoning. The Lyndale Gateway redevelopment area was. rezoned to PC- 2 in September of 1999, at the same time that-the original PUD was approved by the City Council. The rezoning for each of the original three phases does not become effective until the developer (for each phase) "holds title to all properties within (the phase)". The rezoning for Phase I (Mainstreet Village) and Phase II (Casteel Place) have become effective, while the rezoning for Phase III (Lyndale Gateway West) will become effective once Cornerstone has secured title to all properties within the redevelopment area. Building Design. The proposal has two distinct building design types. First, the townhouses facing Aldrich have brick and stucco finishes and gabled roofs with shingles. Second, the commercial and commercial/residential buildings facing.. Lyndale have brick and stone finishes with aluminum storefront systems on the ground floor and, in the building with residential uses above, brick, stucco, and ornamental metal on the upper level. Parkin .The proposal includes three parking components. 1) A surface lot on the interior of the parcel with 145 stalls for use by customers and employees of the commercial tenants. City standards require 1 stall for every 250 square feet of officeor retail .use, so the proposed 20,000 square feet of commercial space would require 80 stalls. City standards require 1 space for every 2.5 restaurant seats, so the proposed 210 restaurant seats would require 84 spaces, for a total requirement of 164 stalls, or 19 more than are provided. The developer is requesting that parking requirement reductions, or credits, be granted for this shortfall for two reasons: First, the project is on a parcel that is well served by mass transit. Second, due to the mixed-use nature of the project and particularly the anticipated mix of restaurants, parking demand will be spread throughout the day. The developer anticipates two or possibly three restaurant tenants, with one generating morning parking demand and the other(s) generating afternoon and evening ' l' parking demand: 2) An underground ramp with 126 parking stalls for use by the residents of the condominiums. A total of 128 stalls would be required if 1.25 parking spaces were required for the 67 studio or one-bedroom units (for a total of 84 stalls) and if 1.75 parking spaces were required for the 25 two or `two-plus' bedroom units (for a total of 44 stalls). In addition to the underground parking, stalls for residential tenants and their guests will also be available in the surface lot during evening hours, when the commercial tenants do not generate parking demand. The site is also well served by mass-transit. Access to the underground parking will be from a ramp in the interior parking area at the north end of the parcel. 3) Each of the 14 townhouses includes. atwo-car garage, accessed from the interior of the site. • Access. Entrance to the proposed development would be limited to 76th and 77th Streets and Lyndale Avenue-there would be no entrance from Aldrich. Exiting the development would be allowed onto 76th and 77th Streets and Lyndale Avenue. The existence of center medians on both 77th and Lyndale will determine how automobiles must enter or leave the site depending on which direction they are travelling. For example-cars coming from the west on 77th must turn north on Lyndale to enter the site-they cannot enter from 77th Street. Similarly, a car wishing to exit the site and go east on 77th must exit southbound onto Lyndale first. Staff has asked that signs be installed in the interior parking area explaining these directions for people exiting the site. Landscaping. Because the proposal is very urban in nature and style, including small set-backs for the commercial buildings, the amount of available space for landscaping is limited. The developer will, however, provide 15-18 foot yards in front of the townhouses; a row of taller trees behind the townhouses to separate/buffer them from the surface parking lot; landscaping in front of the condominiums along 76th Street; and interior landscaping with small planting areas. Also, the City will be providing landscaping and lighting along both sides of Lyndale and in a center median as part of the reconstruction of Lyndale Avenue. Relation to homes on west side of Aldrich. The developers have conscientiously designed the townhouses along Aldrich to be sensitive to the existing single-family homes along the west side of Aldrich. While the proposed townhouses are taller than the existing single- family homes, they are more clearly `residential' in character and they also provide a natural buffer and transition to the more dense and commercial uses on the east side of the redevelopment. • Pedestrian Connections. Because the proposal is urban in nature, it is also very pedestrian friendly, with features such as wide (10 feet plus) sidewalks and multiple points of entry to the buildings and the site interior for pedestrians. Li htin .Lighting for the townhouses will be similar to what the existing houses on Aldrich have. Lighting for the interior parking area will provided with pole-mounted overhead lights. Staff has asked the developer for specifics, which will be submitted for review and approval when they are available. The specific fixtures will coordinate with lighting provided by the City along Lyndale Avenue. Community Meetings. The Cornerstone Group hosted a community Open House on October 15 at Oak Grove Lutheran Church to present their proposal to neighbors and interested citizens. Invitations for the open house were sent to residents and property owners within 350 feet of the project area and approximately 25 people attended. Neighbors expressed no major objections to the proposal. C. FINANCIAL • The Council will consider the creation of a tax increment financing (TIF) district on December 10, 2002. The financing concept was considered in a joint session with the HRA on November 20, 2002. The Planning Commission reviewed the creation of a TIF district and found it to be consistent with the Comprehensive Plan on November 25, 2002. D. LEGAL • The Planning Commission reviewed this request at a public hearing at its October 28, 2002 meeting and voted unanimously to recommend approval. • A simple majority vote is required to approve this request. • 60-DAY RULE: The 60 day clock `started' when a complete application was received on October 15, 2002. A decision must be given to the applicant by December 14, 2002 OR the Council must notify the applicant that it is extending the deadline (up to a maximum of 60 additional .days or 120 days total) for issuing a decision. Legal notice was published in the Sun Current on November 28, 2002. • Notice was mailed to neighbors, property. owners, and commercial tenants within 350 feet on November 26, 2002. The Final Development Plan approval is contingent upon the following stipulations: • That the recipient of this conditional use permit record this resolution with the County, pursuant to Minnesota statutes section 462.36, Subdivision 1 and Richfield Zoning Code 546.05, Subdivision 7; • That the property be replatted; • That a final stormwater management plan, including on-site stormwater pick-up, be submitted to and approved by the Director of Public Works; • That a final landscaping plan be submitted to and approved by the Director of Community Development; ~~` That a signage plan be submitted to and approved by the Director of ~` ~` Community Development; • That a final sediment and erosion control plan, including tree protection specifications, be submitted to and approved by the Director of Public Works; • That a lighting and photometrics plan, including details for how lighting fixtures will coordinate with those provided in the city's streetscape, be submitted to and approved by the Director of Community Development; • That a detailed plan for removal of portions of the sound wall, including planting bed restoration, be submitted to and approved by the Director of Public Works; • That a parking plan, including a detailed allocation description of which stalls are designated for which uses, be submitted to and approved by the Director of Community Development; • That the existing alley be vacated; and • The conditional use permit shall remain in effect for so long as conditions regulating it are observed, and the conditional use permit shall expire if normal operation of the use has been discontinued for 12 or more months, as required by the Zoning Ordinance, Section 546.05, Subd. 9. E. ALTERNATIVE RECOMMENDATION~S~ ~"-'~ • Deny the requested amendment to a Planned Unit Development and a new Final Development Plan and Conditional Use Permit to allow the Cornerstone Group to construct amixed-use development in the 7600 block between Lyndale and Aldrich Avenues. IV. ATTACHMENTS • City Council resolution • Area maps • Packet from the developer, including site plans and building elevations V. PRINCIPAL PARTIES EXPECTED AT MEETING • Applicant: Ms. Colleen Carey and Mr. Dennis Sutliff RESOLUTION NO. ~~ RESOLUTION AUTHORIZING AN AMENDMENT TO A PLANNED UNIT DEVELOPMENT AND AUTHORIZING A NEW FINAL. DEVELOPMENT PLAN & CONDITIONAL USE PERMIT FOR THE 7600 BLOCK BETWEEN LYNDALE AND ALDRICH WHEREAS, an application has been filed with the City of Richfield which requests approval of an amendment to a planned unit development (PUD) and a new Final Development Plan (FDP) and Conditional Use Permit (CUP) for construction of a mixed- use development on land generally bounded by 76th and 77th Streets and Lyndale and Aldrich Avenues, legally described as: Lots 1 to 15, GLENN'S ADDITION, according to the recorded plat thereof, Hennepin County, Minnesota. WHEREAS, the Planning Commission of the City of Richfield has recommended approval of this requested amendment to a Planned Unit Development and a new Final Development Plan and Conditional Use Permit on land generally bounded by 76th and 77th Streets and Lyndale and Aldrich Avenues at its October 28, 2002 meeting, and WHEREAS, this requested Final Development Plan and Conditional Use Permit meet those requirements necessary for issuing a CUP as specified in Richfield's Zoning Code, section 546.05, subd.6; and WHEREAS, the City has fully considered the request for approval of the amendment to the Planned Unit Development and the new Final Development Plan and Conditional Use Permit. NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Richfield, Minnesota, as follows: An amendment to the Planned Unit Development and a new Final Development Plan and Conditional Use Permit is issued for the creation of a mixed-use commercial and residential development, as described in City Council Letter No. on the Subject Property legally described above. 2. This Final Development Plan and Conditional Use Permit on the Subject Property legally described above is subject to completing the following stipulations before a building permit will be issued: • That the recipient of this conditional use permit record this resolution with the County, pursuant to Minnesota statutes section 462.36, Subdivision 1 and Richfield Zoning Code 546.05, Subdivision 7. • That the property be replatted; • That a final stormwater management plan, including on-site stormwater pick- up, be submitted to and approved by the Director of Public. Works; • That a final landscaping plan be submitted to and approved by the Director of Community Development; • That a signage plan be submitted to and approved by the Director of Public _ Works; • That a final sediment and erosion control plan, including tree protection specifications, be submitted to and approved by the Director of Public Works; • That a lighting and photometrics plan, including details for how lighting fixtures will coordinate with those .provided in the city's streetscape, be submitted to and approved by the Director of Community Development; • That a detailed plan for removal of portions of the sound wall, including planting bed restoration, be submitted to and approved by the Director of Public Works; • That a parking plan, including a detailed allocation description of which stalls are designated for which uses, be submitted to and approved by the Director of Community Development; and • That the existing alley be vacated. 3. The conditional use permit shall remain in effect for so long as conditions regulating it are observed, and the conditional use permit shall- expire if normal operation of the use has been discontinued for 12 or more months, as required by the Zoning Ordinance, Section 546.05, Subd. 9. Adopted by the City Council of the City of Richfield, Minnesota this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk Q LYNDALE GATEWAY WEST, OCTOBER, 2002 ZONING OF PROPERTIES WITHIN 350 FEET R R R R R R R R R R R R R R R R R R R R R R G2 R G2 G2 R R R R G2 R G2 R 76TH ST. PG2 PG2 PG2 PG2 PG2 PC-2 a PG2 PG2 a PG2~ PG2 PG2 ~2 PG2 PG2 PG2 7711-1 ST. ~'S~, 'Q . I G2 PC-2 G3 ~8Ty S-' T .,t` INTERSTATE 494 ZONING SYMBOLS R = SINGLE FAMILY RESIDENTIAL G2 =GENERAL COMMERCIAL G3 =HIGH DENSITY CONWIERCIAL PG2 = PLANNED GENERAL COMMERCIAL 100 0 100 200 300 400 500 600 Feet N 10-1-02 LYNDALE GATEWAY WEST, OCTOBER, 2002 LAND USES OF PROPERTIES WITHIN 350 FEET LAND USE SYMBOLS RES =SINGLE FAMILY RESIDENTIAL APT =APARTMENT BUILDING COM = CONQIAERCIAL N 100 0 100 200 300 400 500 600 Feet 10-1-02 INTERSTATE 494 0 0 0 O o~ z a~~ o~ ~~~ °oa ~ r.. ~~ ~r ~' ~• is ~ p p p y !pC A ll mvy g `ice ~> ~~ ~~~ a 1 R It L~ ~, ~ ~, ~~~;' _J 0 ~- 0 r a tD r b I . ~ . ~ ~ ~ . .~ __ F~] _______I___~___~ r ~ t I ~ r J~ ' ~" ~ ~ ~ ~ '~ '- r ~r' gg ~ ~ ~ ~ t3 i ~ ~ a o ' ' n ~_ _~_~~__-- ..- -_ __ -I I r- ~ o D n o o DAN" o ° ~°X ~ ~ Em ~X ~~ Do ono ~°~° o D ~~ ~! y D ~' N- D 1 m -i -~~ m O ~ D ~jD ~rD ~~~°°DD D rtt r ~DD z r r ~ ~ m° r O °° 6 O =~ °° p0 A ~ nr Qr oti rr. r m D -7npLm~m ~ D ~ ZD O °'' n rD- 1m ~'' ~ cw~~mnim r~'' it Z OD p'u`7n'p ~mm~m~ ~ A A m~~ < ° ~ ~ ° ~m ~ ~~ ~ m ~,O ~~ ~ 8w ° Z tn0 DN ~ D m C1 O Z ;~ 7p ~ y3 c~ D3 N n N m ;p 3 D =+ t~r D ~ y N i-1 ° Z r ~ m Z ~ ~~ pp1 ~ .D.~ t~i~ g r m~ ID- m rr~ ° N ~ ~° D 2 N'i ° N - C -' 4~01P 0 ~ A~'~3A W J J J O~ ~ O~ ~~ N W A• W~W~p_p~{D ('~V, 0 y (1 C1 C1 Cl (1 fl (1 f1 " t1 ® f1 0 C1 n f1 f1 Cl n N ~~Q ~ ~ ~ ~ ~ ~ A tin ~ IQDn b` ~ D D DDD D D D D~ _ D D D D D D D D %~ ~+ (,1 (\(,1(\(~~~~ ~ ~ ~ ~~~ ~ £~ ~ ~• _ ~ ~ ~ ~ i~ ~ ~ ~ a~~ ~ ~ ~~~~~~~ ~ ~ O ro 0 N iN 1 ~~dl S Hl LL j W Q W Q z v _~ .~ l r~ r ~ ~ N~~ i ,, rs ~ ~ ~ ~ ~_~ ~ ~~ I ,~ ~ I~ ~ ,~ ~ i~ ~ ii i~ ,~ ~ j~ ~ II ~.----J ~: ----- z-- ~~3- --~ ~: r=te i ~r-~ i : ~_~ i , ~_~ i ~_~ Z_~' i r--i -~ i ~_~ i -~ i ~_~ , i r=te i ~- - -~ i ~_~ , i ~ i i ~ i i ~ ~- - -~ r ? `:, J ~ ~ ~- - -~ ~ i o ~:- _ ~! i ~ i i ~ --- ~g i i ~ , , i. °"" o.°°,~ 0 I I 4 ww i ~ mY~ ' ~ ~ I I ~ ~ ° I ~ ~ ~ ~ ' I iN 1.S~d1 S H19L ,. ., ~- j W Q U 0 Q 0 h ai N a 0 v 0 a~ h~ a v G7 1~ ~~~ ~~~ m ~~m a~ y d d a~~ •,~ „~ ~ ~~ wee woe 00 ~~~ a b t O h 4 F F O 2 O W O f0 O g O • II J ih 1 ~.~bl S H1 LL _~ 1i j Q Q \Z J __J / ~f- `I w~l '(I v l II Q(I ~~ (I ll `I ~-- oc h ~i h a 0 v 0 1~ s tl ~~~ ~3g i b i~.Am P++~ ~~ G~ F~ +i ~ ~ ~ b b i /1 V ~d'd ~~ ~ v ~° ~ ° a~ ~ moo ~ ~ ~ ~ ~ ~ ~ 0 ~ ~ n i ~------------ ------- ---z----- ---------, '-J Q r o p I ~ ~ LL z° ( ~n9 I z ~ ~ ~~ Wp ~; ~ i ( i o ° ~ n I m ~ ( i I o ~ ~x ~ I __ 0 iN 1 ~~bl S H19L ~2 0 0 0 ~, 0 q 0 • • • ~-° ~~i 1 E ~ ~~ ~~ ~ ~~ ,_ i ( ~ • t~~ o S~ 0 h .. ~i w O O O U' ~~ ~ ~ ~~~ ~ ~ ~~m s~ a .~ 0 b 0 V ~ yp~ ~ p~~ .~ ,~ v ~ •.r 1 ~~ ~ ~°e°o ~ ~"oe •~"~ ~I o 0 ~ a~~ ~I ~i W •~ •r•l ~ 1 TT~~~ V ~ m F ~o ~ 2 O O R N b h 4 c s .. AGENDA SECTION: ~~ I j ~~~ jn, j AGENDA ITEM # REPORT # ~ I STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 • REPORT PREPARED BY: BRUCE SYLVESTER, PLANNING & ZONING ADMINISTRATOR Nance Tats REPORT PRESENTER: BRUCE PALMBORG, COMMUNITY DEVELOPMENT DIRECTOR NAME, Tirz,E DEPARTMENT DIRECTOR REVIEW: ~ ~~~ REVIEWED BY CITY MANAGER: ~' ITEM FOR COUNCIL CONSIDERATION: Continuation of public hearing and second reading of a transitory ordinance vacating the alley right-of-way in the 7600 block of Lyndale and Aldrich Avenues for the Lyndale Gateway West redevelopment project. I. RECOMMENDED ACTION: By Motion: Continue public hearing and second reading of a transitory ordinance vacating the alley right-of-way in the Lyndale Gateway West project area until January 14, 2003. III. BACKGROUND ~ On November 12, 2002 the City Council set the public hearing and second reading for this transitory ordinance for December 10, 2002. Staff missed the deadline for submitting the public notice to the Sun Current. The hearing must be continued to the January 14, 2003 City Council meeting to allow for the proper legal notice to be published. • 1210-LyndaleGateway-AIIeyVacate. doc • III. BASIS OF RECOMMENDATION A. POLICY • N/A B. CRITICAL ISSUES • N/A C. FINANCIAL • N/A D. LEGAL • City Code Section 820.05 requires two weeks published notice prior to a public hearing for the vacation of right-of--way. IV. ALTERNATIVE RECOMMENDATION(S~ nue the public hearing and second reading to a different date. V. ATTACHMENTS • N/A VI. PRINCIPAL PARTIES ExrECTE) AT MEETING • AGENDA SECTION:. P(,~~ I IG 1 117GS AGENDA ITEM # '7 REPORT # 3 ~ 4 • ~~ STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 JOHN STARK, COMMUNITY DEVELOPMENT MANAGER REPORT PREPARED BY: AND KATIA MEDVETSKI, COMMUNITY DEVELOPMENT SPECIALIST NAME, TITLE REPORT PRESENTER: JOHN STARK, COMMUNITY DEVELOPMENT MANAGER NAME, T/TLE DEPARTMENT DIRECTOR REVIEW: o; SIGNATURE • REVIEWED BY EXECUTIVE DIRECTOR: ITEM FOR HRA CONSIDERATION: • Public hearing and approval of (1.) Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area; and (2.) Public hearing for the removal of parcels from the Interchange West and Lyndale Gateway Tax Increment Financing District in order to create the Lyndale Gateway West Tax Increment Financing District (impacted parcels are only in the Lyndale Gateway District); and (3.) Establishment of the Lyndale Gateway West Tax Increment Financing District. I. RECOMMENDED ACTION: Conduct and close a public hearing and by motion: (1.) Adopt a resolution approving modifications to the Redevelopment Plan for the Richfield Redevelopment Project Area; (2.) Adopt a resolution modifying the Tax Increment Financing Plan for the Interchange West and Lyndale Gateway Tax Increment Financing District within the Richfield Redevelopment Project Area; and (3.) adopt a resolution establishing the Lyndale Gateway West Tax Increment Financing District within the Richfield Redevelopment Project Area and adopting a Tax Increment Financing Plan related thereto. 1210_LynGateWest.doc II. BACKGROUND • General On November 18, 2002, the Housing and Redevelopment Authority (HRA) approved the (a.) Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area; (b.) Modification to the Tax Increment Financing Plan for the Interchange West and Lyndale Gateway Tax Increment Financing District; and (c.) establishment of the Lyndale Gateway West Tax Increment Financing District within the Richfield Redevelopment Project Area and adoption of a Tax Increment Financing Plan related thereto, all pertaining to the Cornerstone project, and all contingent upon the Planning Commission's finding that the Modifications and Plans conformed to the general plans for the development and redevelopment of the city. On November 25, 2002, the Planning Commission made the finding that the (a.) Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area; (b.) Modification to the Tax Increment Financing Plan for the Interchange West and Lyndale Gateway Tax Increment Financing District; and (c.) Tax Increment Financing Plan for the Lyndale Gateway West Tax Increment Financing District within the Richfield Redevelopment Project Area all conform to the general plans for the development and redevelopment of the city. It is now appropriate for the City Council to undertake a public hearing on these • matters. History The redevelopment project located within the proposed new Lyndale Gateway West Tax Increment Financing (TIF) District contemplates a "mixed use" development in the northwest quadrant of 77th Street and Lyndale Avenue. This area has been identified for redevelopment since 1985 when the HRA's consultant, BRW, Inc. released its report entitled "ILN Redevelopment Study". At that time, the area of the subject project was within the confines of the Interstate- Lyndale-Nicollet (ILN) Redevelopment Project Area and TIF District. Subsequently in 1996, the Hoisington Koegler Group was retained to study the area and presented its report entitled The Lyndale Gateway Redevelopment Plan and Strategy. This report then became the impetus to undertake requests for proposal for redevelopment feasibility for both sides of Lyndale Avenue between 76th and 77th Streets. In 1999, the HRA contracted with three different developers for what became known as the Lyndale Gateway area. In June of 1999, the parcels within the formerly established ILN TIF District were decertified and incorporated into a newly formed, scattered site redevelopment TIF District - - -Interchange West and Lyndale Gateway TIF District. The proposed developments on the east side of Lyndale Avenue proceeded and came to fruition. However, the development of the west side of Lyndale Avenue stalled and was cancelled by the HRA in • May, 2001. Staff, directed by the HRA, sought out new development proposals for the area through a "request for proposal" or RFP process. By the end of that same year, the HRA endorsed the proposal by the Cornerstone Group for redevelopment of the block on the west side of Lyndale Avenue. For financial and timing purposes, the properties in this area need to be removed from the Lyndale Gateway portion • of the Interchange West and Lyndale Gateway TIF District and incorporated into the new Lyndale Gateway West TIF District. Financial obligations within the Lyndale Gateway District will not be affected by the elimination of these parcels from the District. I. Modification to the Redevelopment Plan for the Richfield Redevelopment Proiect Area The Richfield Redevelopment Project Area would be modified by the approval of this item. This modification would identify Lyndale Gateway West as part of the overall redevelopment strategy for the community. This modification would also find that the area is negatively affected by conditions of blight. This finding is based on a study of the area completed by the consulting firm of Short-Elliott- Hendrickson, Inc. (S-E-H). This blight study, which is attached in its entirety as Attachment E (with portions also attached to the resolution approving a Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area), concludes that the area meets the statutory definition of blight. II. The removal of parcels from the Interchange West and Lyndale Gateway Tax Increment Financing District The commercial property and businesses on the west side of Lyndale Avenue • and the residential homes on the east side of Aldrich Avenue, between 76th Street and 77th Street will be removed to provide the necessary site area for the project. The developer, Lyndale Gateway L.L.C., is already in the process of negotiating purchases within the site area in accordance with the Contract for Private Redevelopment with the HRA. • Twenty-one (21) of the parcels being considered for redevelopment, however, were originally (and still are) identified as parcels in the Lyndale Gateway portion of the Interchange West and Lyndale Gateway TIF District. In order for these parcels to be included in the new Lyndale Gateway West TIF District, they must first be removed from the Interchange West and Lyndale Gateway TIF District; these parcels are identified as: PID Number Address Owner 33-028-24-44-0036 7600 Lyndale Avenue South Top Value Auto Supply Inc. 33-028-24-44-0037 7608-12 Lyndale Avenue South Raymond F. Sawitzke 33-028-24-44-0038 7614-18 Lyndale Avenue South Patrick L. O'Brien 33-028-24-44-0039 7620-26 L ndale Avenue South Elliot I. Wolson 33-028-24-44-0040 7632 Lyndale Avenue South Seasonal Control Inc. 33-028-24-44-0041 7628 Lyndale Avenue South Action Employment Inc. 33-028-24-44-0042 7630 Lyndale Avenue South D N Erickson Et al. Trustees 33-028-24-44-0043 7634-36 Lyndale Avenue South Robert Ehrman & Wife 33-028-24-44-0044 7638-40 Lyndale Avenue South Robert Ehrman & Wife 33-028-24-44-0045 7642 Lyndale Avenue South George A. Rooney Et al. 33-028-24-44-0046 7644 Lyndale Avenue South Robert Lurtsema 33-028-24-44-0056 7601 Aldrich Avenue South J. C. Ulrich Et al. PID Number Address Owner 33-028-24-44-0055 7609 Aldrich Avenue South Bounvien Von souvan Et al. 33-028-24-44-0054 7615 Aldrich Avenue South M. & D. Norling 33-028-24-44-0053 7621 Aldrich Avenue South Constance M. Johnson 33-028-24-44-0052 7627 Aldrich Avenue South Kenneth S. Wren 33-028-24-44-0051 7633 Aldrich Avenue South Alan P. Kraemer 33-028-24-44-0050 7639 Aldrich Avenue South Kristen A. Lamont 33-028-24-44-0047 7648 Lyndale Avenue South City of Richfield 33-028-24-44-0048 7646 Lyndale Avenue South City of Richfield 33-028-24-44-0049 7645 Aldrich Avenue South City of Richfield The elimination of these parcels from the district is considered a reduction in the geographic area of the tax increment district and, therefore, a modification to the Tax Increment Financing Plan for the Interchange West and Lyndale Gateway Tax Increment Financing District. The HRA did on November 18, 2002 hold a public hearing on this modification to effectuate the elimination of parcels. The next step is to notify the County Auditor as to the elimination of these parcels to be eliminated and the reduction in the geographic area of the Interchange West and Lyndale Gateway TIF District. II1. Establishment of the Lyndale Gateway West Tax Increment Financing District • In order for the new development to generate and utilize tax increment financing (TIF), a new TIF district must be created with an associated TIF Plan. The proposed Lyndale Gateway West TIF District facilitates the new construction of the following components of the Cornerstone development project: • 92 for-sale "loft" condominium units (30 percent currently priced at affordable); • 14 for-sale townhomes (market rate); • Approximately 27,000 square feet of neighborhood oriented retail space; • 114-stall underground parking structure and 139 surface parking spaces; 15 two-car garages (townhomes); • Streetscape improvements on the 7600 block of Lyndale Avenue (both sides); and • Reconstruction of Lyndale Avenue between 76th and 77th Streets. Lyndale Gateway L.L.C. is requesting public assistance to help offset the cost of the acquisition and site clearance of the property. Other eligible costs that supplement the redevelopment include the public improvements listed above. But for the use of TIF and other public assistance, this redevelopment project would not be feasible. . Among the reasons that the existing properties are being considered for removal and redevelopment is the substandard nature of the buildings. That the buildings are substandard has been a widely held opinion among staff and appointed and elected officials for many, many years. In order to create a new TIF District, however, the buildings must technically be found to be substandard. State statutes prescribe the criteria, which must be met in order to classify a building as substandard. These statutes also stipulate the required building coverage and . distribution of substandard buildings required within a redevelopment district. The HRA hired the consulting firm of Short-Elliott-Hendrickson, Inc. (S-E-H) to complete the required technical analysis of the buildings. With that technical analysis, entitled Redevelopment Eligibility Assessment (included as Exhibit B to Attachment C, Resolution Establishing the Lyndale Gateway West Tax Increment Financing District within the Richfield Redevelopment Project Area and Adopting a Tax Increment Financing Plan Therefor), the HRA and City Council will have the basis on which to make a finding that the area meets the requirements of eligibility for creating a TIF District for the purposes of redevelopment. In basic terms, there are two primary tests; "the coverage test" and "the substandard test." The coverage test requires that at least 70% of the lots contain improvements; in their study, S-E-H concludes that the area has a coverage of 100%. The substandard test requires that at least 50% of the buildings be substandard and that those substandard buildings are reasonably distributed among the area. The S-E-H findings conclude that 61 % of the buildings were found to be structurally substandard and reasonably distributed. The technical report provides a great deal of information on these findings and the methodology and data on which it is based. Upon review, staff concurs with the findings of S-E-H's Redevelopment Eligibility Assessment and is recommending that its findings be relied upon when considering approval of the attached resolutions. • Appendix D of the attached Tax Increment Plan for Lyndale Gateway West provides an estimated detailed cash flow. The actual amount of public assistance may differ from, but will not exceed this estimate of the required public assistance. In the attached plan documents, the current assessor's market value for the properties is $2,435,600. The estimated market value of the project upon completion is $23,960,004. The gross tax increment over 25 years is estimated at approximately $7.5 million with a net tax increment present value estimated at approximately $2.4 million. A summary of the Tax Increment Plan for Lyndale Gateway West is provided immediately in back of Attachment D. III. BASIS OF RECOMMENDATION A. POLICY • The HRA effectuated the elimination of parcels from a tax increment district by resolution and after public hearing on November 18, 2002. • Pursuant to Minnesota Statutes, Section 469.175, Subd. 4., a public hearing on the elimination of parcels from a tax increment district was required since the current net tax capacity of some of the parcels to be eliminated from the Interchange West and Lyndale Gateway TIF District equals or is less than the net tax capacity of the parcels in the Interchange West and Lyndale Gateway District's original net tax capacity. • On November 18, 2002, HRA approved the Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area; Modification to the TIF Plan for the Interchange West and Lyndale Gateway TIF District; and established the Lyndale Gateway West TIF within the Richfield Redevelopment Project Area and adopted the TIF Plan related thereto. • On November 25, 2002, the Planning Commission made the finding that the Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area; Modification to the TIF Plan for the Interchange West and Lyndale Gateway TIF District; and TIF Plan for the Lyndale Gateway West TIF District within the Richfield Redevelopment Project Area all conform to the general plans for the development and redevelopment of the city. • On November 28, 2002, a legal notice of public hearing for the Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area; Modification to the TIF Plan for the Interchange West and Lyndale Gateway TIF District; and establishment of Lyndale Gateway West TIF District within the Richfield Redevelopment Project Area, including adoption of the TIF Plan related thereto, was published in the Sun Current newspaper. • Notices as to the modified redevelopment project area plan, modified TIF plan and establishment of a new TIF district and adoption of a new TIF plans were also made to the city's i representative of the affected area on the Hennepin County Board of Commissioners, the Hennepin County Board Chair and Board of Commissioners, Hennepin County Auditor and the School District via the School Board Clerk. • The Hennepin County Board of Commissioners responded to the notice on November 22, 2002, whose report is attached as Attachment F and made a part of this record. (Sid Inman of Ehlers and Associates, Inc. addresses the County's concerns within the "but/for" analysis that will be presented at the public hearing.) • The Contract for Private Redevelopment between the HRA and Lyndale Gateway L.L.C. requires the consideration of tax increment financing as part of the project approval process. • The Richfield Redevelopment Project Area Plan and Tax Increment Financing Plans for Interchange West and Lyndale Gateway and Lyndale Gateway West have been prepared and are following a process outlined by law. • Among the supporting documentation and data for the attached resolutions for HRA consideration are the Blight Assessment (included as Attachment E) and the Redevelopment Eligibility Assessment (included as Exhibit B to Attachment C, Resolution Establishing the Lyndale Gateway West Tax Increment Financing District within the Richfield Redevelopment Project Area and • Adopting a Tax Increment Financing Plan Therefor) which were conducted by the consulting firm of Short-Elliott-Hendrickson, Inc. (S-E-H). B. CRITICAL ISSUES • The Lyndale Gateway West TIF District cannot be created without • the removal of parcels from the previously established Interchange West and Lyndale Gateway District and the establishment of a new Lyndale Gateway West TIF District. • This area has been contemplated for redevelopment since -the adoption, in 1985, of the ILN Redevelopment Plan (and later, in 1996, the Lyndale Gateway Redevelopment Strategy Plan). Since that time there have been several redevelopment proposals. None of these proposals, however, have proceeded this far into the process. • The schedule for the Lyndale Gateway West redevelopment project contemplates the commencement of the condemnation process (if necessary) on December 16; this timing is possible should both the HRA and City Council approve the attached resolutions. The HRA acted affirmatively on November 18; now, the City Council is being requested to do the same on December 10. C. FINANCIAL • The removal of the 21 parcels from the Interchange West and Lyndale Gateway District does not have a negative financial impact on the district. • Ehlers and Associates, Inc., the HRA's financial consultant, has prepared the cashflows for the project and incorporated them into the tax increment financing plan for the district, in accordance with representations made by the developer. D. LEGAL • Kennedy & Graven, the City's legal counsel, has reviewed all relevant material related to the proposed project and plans being presented for Council consideration. • Legal counsel prepared the attached resolutions for the Council's consideration. • The redevelopment and tax increment plans meet the requirements of state law and established procedures within Richfield. • The approval of the plan documents are consistent with the Contract for Private Redevelopment with Lyndale Gateway L.L.C. • Legal council has thoroughly reviewed the Blight Assessment and the Redevelopment Eligibility Assessment which were conducted by S-E-H, and found these documents to meet the appropriate legal requirements. IV. ALTERNATIVE RECOMMENDATION(S~ • Delay or do not approve the Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area, Modification to the Interchange West and Lyndale Gateway Tax Increment Financing Plan, establishment of the Lyndale Gateway West and adoption of the Lyndale Gateway West Tax Increment Financing Plan. • Undertaking any of the alternative recommendations will negatively impact the establishment of the new Lyndale Gateway West Tax Increment District and greatly impede moving forward with the schedule for the proposed redevelopment project. V. ATTACHMENTS • Attachment A: A Resolution Approving Modifications to the Redevelopment Plan for the Richfield Redevelopment Project Area. • Attachment B: A Resolution Modifying the Tax Increment Plan for the Interchange West and Lyndale Gateway Tax increment Financing District (a redevelopment district) within the Richfield Redevelopment Project Area. • Attachment C: Resolution establishing the Lyndale Gateway West Tax Increment Financing District within the Richfield Redevelopment Project Area and adopting a Tax Increment Financing Plan therefor. • Attachment D: Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area and the Modification to the Tax Increment Financing Plan for the Interchange West and Lyndale Gateway Tax Increment Financing District and the Tax Increment Financing Plan for the Lyndale Gateway West Tax Increment Financing District (a redevelopment district) within the Richfield Redevelopment Project Area. Attachment E: Blight Assessment conducted by Short-Elliott-Hendrickson, • Inc. (S-E-H). • Attachment F: Report from Richard P. Johnson, Hennepin County Deputy Administrator, to the Hennepin County Board of Commissioners, concerning the proposed Richfield Lyndale Gateway West Redevelopment TIF District. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Sid Inman, Ehlers and Associates, Inc. • Dan Cornejo, Short Elliott Hendrickson, Inc. (S-E-H) • Jason Zemke, Short Elliott Hendrickson, Inc. (S-E-H) • Property owners and tenants in the affected area • Attachment A • RESOLUTION NO. RESOLUTION APPROVING MODIFICATIONS TO THE REDEVELOPMENT PLAN FOR THE RICHFIELD REDEVELOPMENT PROJECT AREA WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield (the "Authority") did, on or about June 14, 1993, originally adopt the Redevelopment Plan for the Richfield Project Area, pursuant to the provisions of Minnesota Statutes,. Sections 469.001 to 469.047 (the "HRA Act"), and has subsequently modified the same thereafter; and WHEREAS, pursuant to the HRA Act the Authority proposes to modify the Redevelopment Plan; and WHEREAS, the Authority has caused to be prepared a modification to the Redevelopment Plan, and has requested the written opinion of the Planning Commission of the City; and WHEREAS, the Authority did, on or about November 18, 2002, approve the • modifications and make a request that the City Council hold a public hearing on the proposed modification, all in accordance with the HRA Act; and WHEREAS, the Authority has included in its application to the City Council the materials required in Minnesota Statutes, Section 469.028, subd. 1; and WHEREAS, the City Council did on December 10, 2002 based on such reference and following notice as required by law, hold its hearing on the approval of the modifications to the Redevelopment Plan. • WHEREAS, a certain written report (the "Report") relating to the Redevelopment Plan and to the activities contemplated therein have heretofore been prepared by staff or by consultants retained by the City or the Authority and submitted to the Council and/or made a part of the City files and proceedings on the Redevelopment Plan. The Report was prepared by Short Elliott Hendrickson, Inc. ("S-E-H"), and is entitled "Report on Blight Assessment;Lyndale Gateway West Area." The findings of this Report are attached hereto as Exhibit A, and was further supplemented by testimony at the public hearing by a representative of S-E-H. The Report includes data, information and/or substantiation constituting or relating to the bases for the other findings and determinations made in this resolution. The Council hereby confirms, ratifies and adopts the Report, which are hereby incorporated into and made as fully a part of this resolution to the same extent as if set forth in full herein. JBD-223858v I RC125-240 NOW, THEREFORE, BE IT RESOLVED by the City as follows: • I. The City makes the following findings: 1. the land in the project area would not be made available for redevelopment without the financial aid to be sought; 2. the modifications to .the redevelopment plan for the redevelopment areas in the locality will afford maximum opportunity, consistent with the needs of the locality as a whole, for the redevelopment of the areas by private enterprise; and 3. the redevelopment plan conforms to a general plan for the development of the locality as a whole; and 4. based on the information contained in Exhibit A and information presented at the hearing and otherwise known to the council, the portion of the Project Area comprising the proposed Lyndale Gateway West Tax Increment Financing District is blighted within the meaning of Minnesota Statutes, Sections 469.002 and 469.028. II. The City Council hereby approves the proposed modifications to the Redevelopment Plan, and makes all of the findings stated therein. Adopted by the City Council of the City of Richfield, Minnesota this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk • JBD-223858v1 RC 125-240 • Exhibit A to Attachment A Detailed Analysis of Blight Conditions Lyndale Gateway West Area [Incorporated from Short Elliot Hendrickson, Inc. Report] Statutory Definition of Blighted Area "Blighted area (contains) buildings or improvements which by reason of dilapidation, obsolescence, overcrowding, faulty arrangement or design, lack of ventilation, light, and sanitary facilities, excessive land coverage, deleterious land use, or obsolete layout, or any combination of these or other factors, are detrimental to the safety, health, morals, or welfare of the community." 1. Dilapidation The residential and commercial properties were constructed between 1947 and 1952. Even though these properties, as well as the existing commercial and residential improvements constructed on them, can be considered old, they are not considered to have any historical value nor architectural merit. Old properties, however, require . relatively higher levels of maintenance and repair. Over half of these properties can be considered to be lacking in needed maintenance and repair. The criterion of "dilapidation" was observed to apply to twelve (12) parcels within the project planning area. Six (6) of parcels exhibited "strong" evidence of this criterion while another six (6) parcels exhibited "moderate" evidence. a. Deferred maintenance of structures and site improvements. b. Buildings and paved surfaces in disrepair a. Deferred Maintenance: Specific evidence of deferred maintenance includes: • Poorly maintained exterior building surfaces including masonry, stucco, wood clapboard and metal siding. • Back yard areas overgrown with vegetation. • Cracked, rutted paved surfaces. • Windows & Doors: cracked, ajar or boarded up. Excluding the three city owned properties that have become part of the 77th Street Right-of--Way, over 57% of these properties (12 of 18 parcels) exhibit a deferred maintenance pattern. As determined by the analysis of Substandard Conditions (see separate report), on average, over 18% of the cost of constructing new buildings of the same square footage and type on the same sites would have to be • spent to remedy this blighting factor. The likelihood of this level of remodeling/renovation reinvestment is low, given that the .resultant "product" would be expensive to lease/sell and remain relatively unattractive in terms design and JBD-223858v 1 RC 125-240 • layout. In addition, individual owners would be reluctant to make the required level of investments to their individual properties, given the context of the deteriorating nature of adjacent and nearby properties. b. Building and paved surfaces in disrepair: Specific evidence of buildings and paved surfaces in disrepair includes: • Masonry surfaces broken and in need of tuck-pointing. • Broken windows • Windows and Doors ajar and inoperable. • Entry stairways and service/loading docks broken and failing. • Cracked, broken and crumbling paved surfaces. • Shed-style addition broken and sagging (7600 Lyndale) The twelve properties exhibiting moderate to strong evidence of "dilapidation" include a wide variety of building surfaces and site improvements in a state of significant disrepair. The obvious dilapidation of each of commercial properties and one of the residential properties (7633 Aldrich Ave S) represent a clear blighting influence on abutting properties. In addition, the problems with windows, doors, building surfaces and pavement negatively impact the current use and future prospects for these properties. 2. Obsolescence/Obsolete Layout • The criteria of "obsolescence" and "obsolete layout" were observed to apply to eleven (11) parcels within the project planning area. Ten (10) of parcels exhibited "strong" evidence of these criteria and one (1) additional parcel exhibited "moderate" evidence. a. Dysfunctional layout of buildings and parking. b. Substandard design of alley. c. Dated appearance of structures. a. Dvsfunctional layout of building and parkins: Ten of the eleven commercial parcels are without adequate or convenient parking for customers or visitors based on the layout of the building at zero front lot line. The only available on-site parking for these properties is in the rear yard areas. The majority of these rear yard areas are overgrown with vegetation with paved or gravel surfaces in poor condition. In addition, parking and loading/service areas are not segregated or clearly identified. b. Substandard design of alley: A narrow alley more suitable for strictly residential use serves as the primary access to on-site parking and loading for the commercial properties. The alley also provides access to detached garages for three of the single-family homes that front on Aldrich Avenue. In addition to its narrow width the alley is partially overgrown with vegetation encroaching from residential properties. Overall the alley represents an inconvenient and potentially unsafe primary site access for the majority of parcels within the project planning area JBD-223858v 1 RC125-240 • c. Outdated appearance of structures: All of commercial buildings were originally constructed between 1947 and 1952. Little evidence of regular maintenance, updating or major rehabilitation is evident on the exteriors of any of theses structures. As stated in Paragraph 1 (Dilapidation), these buildings "are not considered to have any historical value nor .architectural merit," and they in fact tend to serve as remnants from a past era that are not consistent with contemporary needs and preferences of retail and commercial service uses. 3. Faulty arrangement or design The criterion of "faulty arrangement or design" was observed to apply to eighteen (18) parcels within the project planning area. Ten (10) of parcels exhibited "strong" evidence of this criterion while another eight (8) parcels exhibited "moderate" evidence. a. Inadequate parking. b. Inconvenient pedestrian and vehicular access. c. Substandard alley. a. Inadequate Parkins: Ten (10) of the eleven (11) commercial properties fronting on Lyndale Avenue South are relatively shallow in terms of current standards. They back onto a narrow (12-foot-wide) alley. This results in a poorly functioning, obsolete parking and loading service area. The lack of legal parking in front of the properties, due to the fact that these properties front onto aCity-owned right-of--way which is not used for street purposes, compounds the parking and loading deficiencies. This situation produces a blighting influence to surrounding properties, as commercial tenants' employees, suppliers, and customers seek out nearby parking opportunities b. Inconvenient pedestrian and vehicular access: The awkward and confusing parking arrangement in that occurs in the Lyndale Avenue Right-of--Way in front of the commercial properties conceals building entrances and represents a safety hazard for pedestrians. This ill-defined informal parking area conflicts with pedestrian access to the commercial uses and is likely to present a particularly undesirable site condition in winter months during conditions of snow and ice. The substandard design of the alley that serves as the primary access for the majority of parcels in the project planning area (see paragraph 2. Dilapidation) also serves as a clear representation of this criterion. Current design standard for a major site access would require a minimum 22-24 foot wide drive width. c. Substandard allev. See Paragraph 2 (Dilapidation) and Paragraph 5 . (Other Factors). 4. Excessive Land Coverage JBD-223858v1 RC125-240 • The criterion of "faulty arrangement or design" was observed to apply to eighteen (18) parcels within the project planning area. Ten (10) of parcels exhibited "strong".evidence of this criterion while one (1) additional parcel exhibited "moderate" evidence. a. Size and placement of commercial buildings. a. Size and placement of commercial buildings: Ten (10) of the eleven (11) commercial parcels exhibit this criterion due to the size of the buildings relative the amount of remaining site area available for parking, loading, and access. As referenced in Paragraph 3 (Faulty Design and Arrangement),s the placement of the commercial buildings at a zero-front-setback exacerbates the problem of excessive land coverage because the principal access points to the .buildings are located on the Lyndale Avenue side (front), making it impractical to provide convenient on-site parking. 5. Other Factors In addition to the above, the following other blighting factors were evident: a. Poor linkage between residential and commercial properties. b. Negative conditions within public rights-of--way. c. Overgrown vegetation. d. Economics of renewal/reinvestment. a. Poor linkage between residential and commercial properties: Various blighting influences that impact the project planning area reflect a linkage between the commercial (east half of block) and residential (west half of block). The limited depth of the commercial parcels combined with the poor condition of the back sides of those properties starkly illustrates that any reuse/rehabilitation solution would need to encompass the entire block. Due to the high trafFc conditions in the area, the lack of on-site parking for commercial uses, and the substandard design of the alley; viable use or reuse of the commercial sites may necessitate redevelopment of the residential half of the block. b. Negative conditions within the public rights-of--way: • The awkward, inconvenient, and unsafe condition and use of the paved right-of--way located between the commercial buildings and Lyndale Avenue (edge of curb). • The substandard design of the alley serving commercial and residential properties. • The obsolete design of the parking area serving 7600 Lyndale Avenue. • The safety concern associated with the detached garage at 7601 • Aldrich that gain access from 76th Street. The above referenced conditions within public right-of--way represent a blighting influence the impacts the entire project planning area. Vehicular and pedestrian JBD-223858v1 RCt25-240 access is compromised by the substandard and antiquated arrangement of driveway cuts, paved surfaces, parking and driveways serving the majority of parcels. c. Overgrown Vegetation: Overgrown vegetation present on nearly all of the commercial parcels and several of the residential parcels represents a blighting influence consistent with the intent of the statutory definition for a blight area. This condition of deferred site maintenance is not characteristic of the majority of Richfield's mature neighborhoods. d. Economics of renewal/reinvestment: In addition, the physical and economic difficulties associated with lot-by-lot, orbuilding-by-building, renewal of these 21 properties lead to the conclusion that this type and form of reinvestment is unlikely to occur. A renewal/reinvestment scenario that would take the form of total redevelopment appears more likely, more desired, and more feasible in terms of producing property design/layout and land use mix that would be market-sensitive and would contribute to the near-term and future health and welfare of the Richfield community. • JBD-223858v1 RC 125-240 Attachment B RESOLUTION NO. RESOLUTION MODIFYING THE TAX INCREMENT PLAN FOR THE INTERCHANGE WEST AND LYNDALE GATEWAY TAX INCREMENT FINANCING DISTRICT (A REDEVELOPMENT DISTRICT) WITHIN THE RICHFIELD REDEVELOPMENT PROJECT AREA BE IT RESOLVED by the City Council (the "Council") of the City of Richfield, Minnesota (the "City"), as follows: Section 1. Recitals. 1.01. It has been proposed by the Housing and Redevelopment Authority in and for the City of Richfield (the "HRA") that the City modify the Lyndale Gateway Tax Increment Financing Plan (the "Plan") for the Lyndale Gateway Tax Increment Financing District (the- "District") by eliminating certain parcels therefrom, all pursuant to and in conformity with applicable law, including Minnesota Statutes, 469.174 to 469.179, all inclusive, as amended, (the "Act") all as reflected in the "Modification to the Tax Increment Financing Plan for the Interchange West and Lyndale Gateway Tax • Increment Financing Plan" (the "Modified Plan"), and presented for the Council's consideration. 1.02. The HRA and City have investigated the facts relating to the Plan and have caused the proposed Modified Plan to be prepared. 1.03. The HRA and City have performed all actions required by law to be performed prior to the adoption and approval of the proposed Modified Plan, including, but not limited to, notification of Hennepin County and Independent School District No. 280 having taxing jurisdiction over the property to be included in the District, a review of and written comment on the Modified Plan, and the holding of a public hearing upon published notice as required by law. Section 2. Findings for the Adoption and Approval of the Modifications to the Plan. 2.01. The Council hereby finds that the Modified Plan, is intended and, in the judgment of this Council, the effect of such actions will be, to provide an impetus for development, serve a public purpose and accomplish certain objectives as specified in the Plans, which are hereby incorporated herein. 2.02. The Council hereby confirms and ratifies all of the findings and determinations made by it upon the original approval of the Plan and the establishment of the District. • JBD-223889v 1 RC125-240 • Section 3. Approval and Adoption of the Modified Plan. 3.01. The Modified Plan, as presented to the Council on this date, including without limitation the findings and statements of objectives contained therein, are hereby approved, ratified, established, and adopted and shall be placed on file in the office of the Community Development Director. 3.02. The staff of the City, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the Modified Plan and to negotiate, draft, prepare and present to this Council for its consideration all further plans, resolutions, documents and contracts necessary for this purpose. 3.03. The Auditor of Hennepin County is requested to certify the original net tax capacity of the District, as modified in the Modified Plan, and to certify in each year thereafter the amount by which the original net tax capacity has increased or decreased. 3.04. The Community Development Director is further authorized and directed to file a copy of the Modified Plan with the Commissioner of the Minnesota Department of Revenue pursuant to Minnesota Statutes 469.175, Subd. 4a. Adopted by the City Council of the City of Richfield, Minnesota, this 10th day of • December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk • JBD-223889v I RC125-240 Attachment C • RESOLUTION NO. RESOLUTION ESTABLISHING THE LYNDALE GATEWAY WEST TAX INCREMENT FINANCING DISTRICT WITHIN THE RICHFIELD REDEVELOPMENT PROJECT AREA AND ADOPTING A TAX INCREMENT FINANCING PLAN THEREFOR BE IT RESOLVED by the City Council (the "Council") of the City of Richfield, Minnesota (the "City"), as follows: Section 1. Recitals. 1.01. It has been proposed by the Housing and Redevelopment Authority in and for the City of Richfield (the "HRA") that the City establish the Lyndale Gateway West Tax Increment Financing District (the "District") and adopt a Tax Increment Financing Plan therefor (the "Plan"); all pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469.174 to 469.179, all inclusive, as amended, (the "Act") all as reflected in the Plan, and presented for the Council's consideration. • 1.02. The HRA and City have investigated the facts relating to the Plan and have caused the Plan to be prepared. 1.03. The HRA and City have performed all actions required by law to be performed prior to the establishment of the District and the adoption and approval of the proposed Plan, including, but not limited to, notification of Hennepin County and Independent School District No. 280 having taxing jurisdiction over the property to be included in the District, a review of and written comment on the Plan, and the holding of a public hearing upon published notice as required by law. 1.04. Certain written reports (the "Reports") relating to the Plan and to the activities contemplated therein have heretofore been prepared by staff or by consultants retained by the City or the HRA and submitted to the Council and/or made a part of the City files and proceedings on the Plan. Included among the Reports is a report prepared by Short Elliott Hendrickson, Inc. ("S-E-H"), entitled "Redevelopment Eligibility Assessment Proposed `Lyndale Gateway West' Redevelopment Area" attached hereto as Exhibit B, which report was further supplemented by testimony at the public hearing by a representative of S-E-H. The Reports include data, information and/or substantiation constituting or relating to the basis for the other findings and determinations made in this resolution. The Council hereby confirms, ratifies and adopts the Reports, which are hereby incorporated into and made as fully a part of this resolution to the same extent as if set forth in full herein. C, JBD-223861v1 RC 125-240 Section 2. Findings for the Adoption and Approval of the Plan. • 2.01. The Council hereby finds that the Plan, is intended and, in the judgment of this Council, the effect of such actions will be, to provide an impetus for development, serve a public purpose and accomplish certain objectives as specified in the Plans, which are hereby incorporated herein. Section 3. Findings for the Establishment of Lyndale Gateway WestTax Increment Financing District. 3.01. The Council hereby finds that the District is in the public interest and is a "redevelopment district" under Minnesota Statutes, Section 469.974, subd. 90 (a)(9). 3.02. The Council further finds that the proposed redevelopment would not occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the District permitted by the Tax Increment Financing Plan, that the Plans conform to the general plan for the development or redevelopment of the City as a whole; and that the Plan will afford maximum opportunity consistent with the sound needs of the City as a whole, for the development or redevelopment of the District by private enterprise. • 3.03. The Council further finds, declares and determines that the City made the above findings stated in this Section and has set forth the reasons and supporting facts for each determination in writing, attached hereto as Exhibit A. 3.04. The Richfield Housing and Redevelopment Authority elects to calculate fiscal disparities for the District in accordance with Minnesota Statutes, Section 469.977, subd. 3, clause b, which means the fiscal disparities contribution would be taken from inside the District. 3.05. The Council finds that the Plan contains the requirements of Minnesota Statutes, Section 469.175, subd. 1. Section 4. Public Purpose 4.01. The adoption of the Plan conforms in all respects to the requirements of the Act and will help fulfill a need to redevelop an area of the City that qualifies for treatment as a Redevelopment District under the Act, to improve the tax base and to improve the general economy of the State and thereby serves a public purpose. Section 5. Approval and Adoption of the Plan. • 5.01. The Plan, as presented to the Council on this date, including without limitation the findings and statements of objectives contained therein, are hereby JBD-223861 v 1 RC125-240 approved, ratified, established, and adopted and shall be placed on file in the office of the Community Development Director. • 5.02. The staff of the City, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the Plan and to negotiate, draft, prepare and present to this Council for its consideration all further plans, resolutions, documents and contracts necessary for this purpose. 5.03 The Auditor of Hennepin County is requested to certify the original net tax capacity of the District, as described in the Plan, and to certify in each year thereafter the amount by which the original net tax capacity has increased or decreased; and the Richfield Housing and Redevelopment Authority is authorized and directed to forthwith transmit this request to the County Auditor in such form and content as the Auditor may specify, together with a list of all properties within the District, for which building permits have been issued during the 18 months immediately preceding the adoption of this resolution. 5.04. The Community Development Director is further authorized and directed to file a copy of the Plans with the Commissioner of the Minnesota Department of Revenue pursuant to Minnesota Statutes, Section 469.175, subd. 4a. Adopted by the City Council of the City of Richfield, Minnesota, this 10th day of December, 2002. • Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk JBD-223861v1 RC125.240 • Exhibit A to Attachment C The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for the Lyndale Gateway West Tax Increment Financing District, as required pursuant to Minnesota Statutes, Section 469.175, subd. 3 are as follows: 1. Finding that Lyndale Gateway West Tax Increment Financing District is a redevelopment district as defined in Minnesota Statutes, Section 469.174, subd. 10(a)(1). The District consists of 21 parcels and adjacent and internal rights of way, with plans to redevelop the area for mixed-use housing and retail purposes. Parcels that make up at least 70 percent of the area in the District are occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures,. and more than 50 percent of the buildings in the District, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance (See Appendix E to the TIF Plan, and Exhibit B to this Resolution). 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that . could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the Lyndale Gateway West Tax Increment Financing District permitted by the Plan. The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future: The area to be included in the district has not been significantly upgraded or renovated for many years. A list of all of the reports and studies documenting earlier studies and documentation for the need for redevelopment and unsuccessful redevelopment efforts to redevelop the area can be found in the files of the City's Director of Community Development. The only significant new construction activity in the vicinity of the District within the past quarter century was accomplished only because public assistance was made available. The proposed development, which includes retail, commercial and housing calls for the acquisition of all of the land in the District, the demolition of all improvements, and the comprehensive redevelopment of the entire area. Site assembly costs, including the need to purchase buildings and other improvements only to demolish them before redevelopment can take place, would understandably seem to prevent the proposed development to take place through private investment. Because the parcels within the proposed district are in multiple ownerships, it is unlikely that . assembly could take place without the ability to compel sale, unless a premium were paid for the land. The developer is also being asked to provide an affordable housing component to the development. Absent public assistance, private investors JBD-223861 v 1 RC 125-240 • would likely not elect to participate in such a program. These conclusions are reinforced by the analysis prepared by Ehlers & Associates, Inc. as justification that the developer would not have gone forward without tax increment assistance (see Appendix F to the TIF Plan). The increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the Plan: On the basis of what has been stated above, the City finds it unlikely that any new development impacting market values will take place in the district. In any event, it is the Council's finding that no development or combination of developments with a market value of greater than $23,960,004 (based on Appendix D to the TIF Plan) would occur without tax increment assistance in this district within 25 years. 3. Finding that the Tax Increment Financing Plan for Lyndale Gateway West Tax Increment Financing District conforms to the general plan for the development or redevelopment of the municipality as a whole. The Planning Commission reviewed the Plan and found that the Plan conforms to the general development plan of the City. 4. Finding that the Tax Increment Financing Plan for the Lyndale Gateway West Tax Increment Financing District will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development or redevelopment of Richfield Redevelopment Project Area by private enterprise. No significant redevelopment has occurred within the area of the district for many years. Consequently, it is the determination of the City that absent the assistance authorized by the Plan, no development or redevelopment of the area by private enterprise can be reasonably anticipated. The Council also finds that the implementation of the Plan through the construction of the proposed development will increase the availability of safe and decent life-cycle housing in the City, will increase the tax base, will add a high quality mixed-use development to the City, will eliminate or prevent the spread of blight, and will remove and replace substandard structures and other conditions in furtherance of the objectives for which the District is being created. .7 JBD-223861v1 RC125-240 Exhibit B to Attachment C Redevelopment Eligibility Assessment Proposed Lyndale Gateway West Redevelopment Area • • JBD-223861 v 1 RC125-240 Redevelopment Eligibility Assessment Proposed "Lyndale Gateway West" Redevelopment Area Richfield, MN • November 12, 2002 Prepared by: Short Elliott Hendrickson, Inc. (SEH) Butler Square Building, Suite 710C 100 North 6~' Street Minneapolis, MN 55403 SEH No. A-RFHRA0301.00 • City of Richfield Lyndale Gateway West Redevelopment Eligibility Assessments November 12, 2002 PURPOSE Short Elliott Hendrickson, Inc. (SEH) was hired by the Richfield Housing and Redevelopment Authority (HRA), Richfield, Minnesota, to survey and evaluate the properties within the proposed "Lyndale Gateway West" Tax Increment Financing District. The proposed district is bounded by 76 St. West on the north, Lyndale Ave. South on the east, 77~' St. West on the south, and Aldrich Ave. South on the west. The purpose of our work was to independently ascertain whether the qualification tests for tax increment eligibility, as required under Minnesota Statute, could be met. The findings and conclusions drawn herein are solely for the purpose of tax increment eligibility and are not intended to be used outside the scope of this assessment. SCOPE OF WORK The proposed district consists of 21 property parcels comprised of the following types of improvements: 7 single family dwellings, 14 commercial structures on 11 parcels, and 3 vacant parcels with parking or street improvements. EVALUATIONS Of the twenty-one (21) buildings in the proposed district, only four (4) buildings, two residential and two commercial, were available for exterior evaluation only. The interior public spaces of two (2) tenant spaces and the entire interior of the remainder of the buildings were evaluated. FINDINGS Coverage Test -Twenty-one (21) of the twenty-one (21) properties met the coverage test with a 100% area coverage. This exceeds the 70% area coverage requirement. Condition of Buildings Test -Sixty-one (61) percent of the buildings -13 of the 21 buildings -were found to be "structurally substandard" when considering code deficiencies and other deficiencies of sufficient total significance to justify substantial renovation or clearance (see definition of "structurally substandard" as follows). This exceeds the Condition of Buildings Test whereby over 50% of buildings, not including outbuildings, must be found "structurally substandard." CONCLUSION Our surveying and evaluating of the properties within this proposed Redevelopment District render results that in our professional opinion qualify the district eligible under the statutory criteria and formulas for Tax Increment Financing District Funding. SUPPORTING DOCUMENTS ATTACHED Summary report detailing the above findings, including proposed redevelopment area map(s) PROCEDURAL REQUIREMENTS The properties were surveyed and evaluated in accordance with the following requirements under Minnesota Statute Section 469.174, Subdivision 10, clause (c) which states: Interior Inspection - "The municipality may not make such determination [that the building is structurally substandard] without an interior inspection of the property..." Exterior Inspection and Other Means - "An interior inspection of the property is not required, if the municipality finds that (1) the municipality or authority is unable to gain access to the property; and after using its best efforts to obtain permission from the party that owns or controls the property; and (2) the evidence otherwise supports a reasonable conclusion that the building is structurally substandard." Documentation - "Written documentation of the building findings and reasons why an interior inspection was not conducted must be made and retained under section 469.175, subdivision 3, clause (1)." Refer to Exhibit A -Documentation of Contacts/Evaluations, immediately following page 10 of this report. PROCEDURES FOLLOWED TO MEET REQUIREMENTS The Richfield HRA sent letters to all property owners located in the district requesting that an inspection and evaluation be made of their property. SEH conducted assessments between October 9~' and October 29~', 2002. Requests for evaluation appointments were made with the building owner or building tenants. An interior inspection and evaluation was completed if consented to by the owner. Interior evaluations were limited to public areas where interior access was denied or not made available. An exterior inspection and evaluation was made where the owner refused interior access to their property. In all cases, an exterior evaluation was completed. For all subject buildings, Richfield HRA provided copies of all available building permits on record for review by SEH. These permits provide a basic description of type of work completed for each permit (Building, Electrical, or Plumbing, scope of work) and, in some cases, approximate value of work to be completed. Additionally, copies of fire inspection reports, police reports, point of sale reports, and rental property inspection reports were also provided for all buildings if available. These reports identify Fire Code violations and life safety deficiencies in the buildings, as observed at the time of the report. In some cases, completed and approved corrections are noted on the reports. Additional building data was collected from public taxpayer information available from Hennepin County. Building data from these public records was combined with and reviewed against information gathered in the field. 3 • QUALIFICATION REQUIREMENTS The properties were surveyed and evaluated to ascertain whether the qualification tests for tax increment eligibility for a redevelopment district, required under the following Minnesota Statutes, could be met. Minnesota Statute Section 469.174, Subdivision 10, clause (a) (1) requires two tests for occupied parcels: 1. Coverage Test - "parcels consisting of 70 percent of the area of the district are occupied by buildings, streets, utilities, paved or gravel parking lots or similar structures ..." Note: The coverage required by the parcel to be considered occupied is defined under Minnesota Statute Section 469.174, Subdivision 10, clause (e) which states: "For purposes of this subdivision, a parcel is not occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures unless 15% of the area of the parcel contains buildings, streets, utilities, paved or gravel parking lots or other similar structures." 2. Condition of Buildings Test - " ...and more than 50 percent of the buildings, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance;" The term `structurally substandard', as used in the preceding paragraph, is defined by a two-step test: Conditions Test: Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, clause (b), a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies inessential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." Code Test: Notwithstanding the foregoing, the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, clause (c) also provides that a building may not be considered structurally substandard if it: "... is in compliance with building code applicable to new buildings or could be modified to satisfy the building code at a cost of less than 15 percent of the cost of constructing a new structure of the same square footage and type on the site." Based on the above requirements, the substandard determination of a particular building is atwo-step process; therefore, the findings of each step are independent of each other and both steps must be satisfied in order for a building to be found structurally substandard. It is not sufficient to conclude that a building is structurally • substandard solely because the Code Test is satisfied. It is theoretically possible for a 4 building to require extensive renovation in order to meet current building codes but still not meet the main test of the Conditions Test. Furthermore, deficiencies included in the Conditions Test may or may not include specific code deficiencies as listed in the Code Test. In many cases, specific building code deficiencies may well contribute to the data which supports satisfying the Conditions Test; conversely, it is certainly possible that identified hazards or other deficiencies which could be included in the Conditions Test do not necessarily constitute current building code deficiencies. By definition, the nature of the two steps is slightly different. The Conditions Testis more subjective, whereas the Code Test is an objective test. Conditions Test deficiencies are less technical and not necessarily measurable to the same extent of the code deficiencies in the Code Test. To the end that technical, measurable building code deficiencies support the satisfaction of the less technical Conditions Test, the following code requirements are defined in terms that go beyond the technical requirements of the code and demonstrate their relevance in terms of " ...deficiencies in essential utilities and facilities, light and ventilation, etc..." Uniform Building Code (UBC): The purpose of the UBC is to provide minimum standards to safeguard life or limb, health, property and public welfare by regulating and controlling the design, construction, quality of materials, use and occupancy, location and maintenance of all buildings and structures (UBC 101.2). • A deficiency in the building code (insufficient number of building exits, insufficient door landing area, etc.) adversely affects one or more of the above standards to safeguard `life or limb ...and public welfare'; therefore, a deficiency in the building code is considered a deficiency in one or more "essential utilities and facilities, light and ventilation, etc.". Minnesota Accessibility Code Chapter 1341 • This chapter sets the requirements for accessibility all building occupancies. The Minnesota Accessibility Code closely follows the Americans with Disabilities Act Accessibility Guidelines (ADAAG), which sets the guidelines for accessibility to places of public accommodations and commercial facilities as required by the Americans with Disabilities Act (ADA) of 1990. The ADA is a federal anti-discrimination statute designed to remove barriers that prevent qualified individuals with disabilities from enjoying the same opportunities that are available to persons without disabilities (ADA Handbook). Essentially, a deficiency in the accessibility code (lack of handrail extension at stairs or ramp, lack of clearance at a toilet fixture, etc.) results in a discrimination against disabled individuals; therefore, a deficiency in the accessibility code is considered a deficiency in "essential utilities and facilities". Minnesota Food Code Chapter 4626• This chapter is enforced by the Minnesota Department of Health and is similar to the UBC in that it provides minimum standards to safeguard public health in areas of public/commercial food preparation. A deficiency in the food code (lack of non-absorbent wall or ceiling . finishes, lack of hand sink, etc.) causes a condition for potential contamination of food; therefore, a deficiency in the food code is considered a deficiency in "essential utilities and facilities". National Electric Code (NEC): The purpose of the NEC is the practical safeguarding of persons and property from hazards arising from the use of electricity. The NEC contains provisions that are considered necessary for safety (NEC 90-1 (a) and (b)). A deficiency in the electric code (insufficient electrical service capacity, improper wiring, etc.) causes a hazard from the use of electricity; therefore, a deficiency in the electric code is considered a deficiency in "essential utilities and facilities". Uniform Mechanical Code (UMC): The purpose of the UMC is to provide minimum standards to safeguard life or limb, health, property and public welfare by regulating and controlling the design, construction, installation, quality of materials, location, operation, and maintenance or use of heating, ventilating, cooling, and other appliances (UMC 102). The UMC sets specific requirements for building ventilation, exhaust, intake and relief. These requirements translate into a specified number of complete clean air exchanges for a building based on its occupancy type and occupant load. A deficiency in the mechanical code adversely affects the `health ...and public welfare' of a building's occupants; therefore, a deficiency in the mechanical code is considered a deficiency in "light and ventilation". Note: The above list represents some of the more common potential code deficiencies considered in the assessment of the buildings in the proposed district. This list does not necessarily include every factor included in the data used to satisfy the Conditions Test for a particular building. Refer to individual building reports for specific findings. Finally, the tax increment law provides that the municipality may find that a building is not disqualified as structurally substandard under the Code Test on the basis of "reasonably available evidence, such as the size, type, and age of the building, the average cost of plumbing, electrical, or structural repairs, or other similar reliable evidence. Items of evidence that support such a conclusion [that the building is structurally substandard] include recent fire or police inspections, on-site property appraisals or housing inspections, exterior evidence of deterioration, or other similar reliable evidence." 6 • MEASUREMENTS AGAINST TECHNICAL TEST REQUIREMENTS Coverage Test SEH utilized a GIS (Geographic Information Systems) database, available through Hennepin County and the City of Richfield, to obtain individual parcel information. The GIS database contains both graphic information (parcel shapes) and numerical data based on county tax records. This information was used by SEH for the purposes of this assessment. The total square foot area of each property parcel was obtained from county records (GIS) and general site verification. The total extent of site improvements on each property parcel was digitized from recent aerial photography (Spring, 2000). The total square footage of site improvements was then digitally measured and confirmed by general site verification. The total percentage of coverage of each property parcel was computed to determine if the 15% requirement was met. Refer to attached maps: Impervious Surfaces map and Percent Impervious by Parcel map. The total area of all qualifying property parcels was compared to the total area of all parcels to determine if the 70% requirement was met. The area occupied by public rights-of-way has not been considered in the coverage test calculations. All of the public rights-of--way are improved. If all of the public rights-of--way were treated as a parcel for the purpose of coverage test calculations, the 70% requirement of the coverage test would still be met. Condition of Building Test Replacement Cost -the cost of constructing a new structure of the same size and type on site: R. S. Means Square Foot Costs (2002) was used as the industry standard for base cost calculations. R. S. Means is a nationally published reference tool for construction cost data. The book is updated yearly and establishes a "national average" for materials and labor prices for all types of building construction. The base costs derived from R. S. Means were reviewed, and modified if applicable, against our professional judgement and experience. A base cost was calculated by first establishing building type, building construction type, and construction quality level (residential construction) to obtain the appropriate Means cost per square foot. This cost was multiplied times the building square footage to obtain the total replacement cost for an individual • building. Additionally, to account for regionaUlocal pricing, a cost factor was added to the total cost according to R.S. Means tables. Using R. S. Means, consideration is made for building occupancy, building size, and construction type; therefore, the cost per square foot used to construct a new structure will vary accordingly. Building Deficiencies: Conditions Test (Condition Deficiencies) -determining the combination of defects or deficiencies of sufficient total significance to justify substantial renovation or clearance. On-Site evaluations -Evaluation of each building was made by reviewing available information from city records and making interior and/or exterior evaluations, as noted, sometimes limited to public spaces. Deficiencies in structural elements, essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, were noted by the evaluator. Condition Deficiencies may or may not include Code Deficiencies as defined below. Energy code compliance was not considered for the purposes of determining Condition Deficiencies. Deficiencies were combined and summarized for each building in order to determine their total significance. Building Deficiencies: Code Test (Code Deficiencies) -determining technical conditions . that are not in compliance with current building code applicable to new buildings and the cost to correct the deficiencies: On-Site evaluations -Evaluation of each building was made by reviewing available information from city records and making interior and/or exterior evaluations, as noted, sometimes limited to public spaces. On-site evaluations were completed using a standard checklist format. The standard checklist was derived from several standard building code plan review checklists and was intended to address the most common, easily identifiable code deficiencies. Mechanical Engineers, Electrical Engineers, and Building Code Officials were also consulted in the development of the checklist. Deficiencies were generally grouped into the following categories (category names are followed by its applicable building code): • Building accessibility -Minnesota Accessibility Code • Building egress, building construction -Uniform Building Code • Fire protection systems -Uniform Building Code • Food service -Minnesota Food Code • HVAC (heating, ventilating, and air conditioning) -Uniform Mechanical Code • Electrical systems -National Electric Code and Minnesota Energy Code • Energy code compliance -Minnesota Energy Code • For the purposes of determining the Code Test (Code Deficiencies), Energy code compliance is relevant because its criteria affect the design of integral parts of a majority of a building's systems. The intent of these criteria is to provide a means for assuring building durability, and permitting energy efficient operation (7676.0100). The energy code addresses general building construction (all forms of energy transmission in an exterior building envelope -walls, roofs, doors and windows, etc.) and energy usage by lighting and mechanical systems. A deficiency in the energy code (inadequate insulation, non-insulated window systems, improper air infiltration protection, etc.) reduces energy efficient operation and adversely affects building system durability; therefore, a deficiency in the energy code is considered to contribute to a condition requiring substantial renovation or clearance. Office evaluations -Following the on-site evaluation, each building was then reviewed, based on on-site data, age of construction, building usage and occupancy, square footage, and known improvements (from building permit data), and an assessment was made regarding compliance with current mechanical, electrical, and energy codes. A basic code review was also completed regarding the potential need for additional egress (basement stairways, for example), sprinkler systems, or elevators. • Deficiency Cost -Costs to correct identified deficiencies were determined by using R. S. Means Cost Data and our professional judgement and experience. In general, where several items of varying quality were available for selection to correct a deficiency, an item of average cost was used, as appropriate for typical commercial or residential applications. Actual construction costs are affected by many factors (bidding climate, size of project, etc.). Due to the nature of this assessment, we were only able to generalize the scope of work for each correction; that is to say that detailed plans, quantities, and qualities of materials were not possible to be known. Our approach to this matter was to determine a preliminary cost projection suitable to the level of detail that is known. This process was similar to our typical approach for a cost projection that may be given to an owner during a schematic design stage of a project. Costs to correct deficiencies were computed for each building and compared to the building replacement cost to determine if the 15°10 requirement was met. The total number of buildings determined to be "structurally substandard" by satisfying both the Conditions Test and the Code Test in this manner was compared to the total number of buildings in the district to determine if the 50% requirement was met. Reports on Structurally Substandard Buildings and Individual Building Summary Reports • are available for review at the offices of SEH, City of Richfield, and Kennedy & Graven, Chartered, Minneapolis, Minnesota. 9 • Technical Conditions Resources -the following list represents the current building codes applicable to new buildings used in the Building Deficiency review. The following have been adopted by Richfield City Code 400.01 (Rev. 1999): 1998 Minnesota State Building Code 1997 Uniform Building Code 1997 Uniform Housing Code MN 1341-Minnesota Accessibility Code, Chapter 1341 (1999) 2000 Minnesota Energy Code, Chapters 7672, 7674, or 7676 1999 National Electric Code 1997 Uniform Mechanical Code PROJECT TEAM: Jason P. Zemke, AIA, Project Architect Nancy G. 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"~ . ~ ----} 1 1 B A 12 +, ..r, '~. .. ti 15 ..y ~~ - 17 CITY OF RICHFIELD Hennepin County REDEVELOPMENT ELIGIBILITY Coormnatesystemie) ASSESSMENT o so ion Feet Building Assessments Legend Q Project Boundary ~ Parcel Boundaries Building Assessment Category u Category 1: Substandard Building Category 2: Non-Substandard Building Source: Hennepin County, City of Richfield and SEH. t vt 1,2002 sn =SEN • • '~ ~ r,~ ~ >~" - t'om' r-~ J v ~,I 3`"' I J ! L '+ +'~ ++: ~~ t "~4 rr+ ,~. -~ .,~ tel. CITY OF RICHFIELD REDEVELOPED ELIGIBILITY ASSESSMENT 0 Improved Surfaces ~ Hennepin County Coordinate System (N) so too Feet Legend Q Project Boundary Q Parcel Boundaries Impervious Flag No Yes Source: Hennepin County, City of Richfield and SEH. t vo~izooz sn =SEN ~} t ~ ~ _ ~ I ~ ~~ % . ,~}~ f ~! ! ~ I'1 ~ ti . ~ ~ ~ ~1 "~ , __ r, -- I~ l I_~ 1:J --- -- -, J ----_. ~ Ir I j /, ',~ • • • -x-, .r .~, . ~" ryr ~' armor ~ '.,°~ ~ s , 2 r " i _ ~ t . t ~ ~~ ~ ~ ~ #~`a ~ „ 3' ~+ ` ~ ,. .g > ~ , L < ~lU ( ~ ' ~ ~ °~; ~ et~, ~. pr's. ~ ~_ ~" i ~ ,~ L ~ f ~ .f ~ - ~ ~ ~ } ~ J _ ,1 J 1 J f 7, we ~, J I=i - _ .r^ 17 ` j ~ ~I ~ ,. ~~~ i "t ~~ -, ~ t .~ ~ -fi ,,~ CITY OF RICHFIELD Hennepin County REDEVELOPED ELIGIBILITY Coordinate System (h) ASSESSMENT o so too Feet Percent Improved By Parcel Legend Q Project Boundary Q Parcel Boundaries Percent Improved ~ 0 % Developed 1 - 15 % Developed _~~ > 15 °o Developed Source: Hennepin County. City of Richfield and SEH. t vo~izoaz sr, =SEN • Report on Structurally Substandard Building Building ID/Business Name/Address: Satisfies Conditions Test for Structurally Substandard Building: Satisfies Code Test for Structurally Substandard Building: Structurally Substandard Building (Y/I~: Conditions Test 7601 Aldrich Ave. S. 1 N N N Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Light & Ventilation • Deficient in meeting Mechanical code: for residential construction prior to 1980, plumbing systems contain lead soldered connections, which are non-compliant with current building code • Deficient in meeting Electrical code: for residential construction prior to 1980, receptacle locations, receptacle types, and wiring are non-compliant with current building code Fire Protection/Egress • Deficient emergency egress: lack of basement and bedroom emergency egress windows • Deficient interior stairway: deficient handrail height, and returns; handrail not continuous; deficient guardrail construction • Lack of smoke detector/detection system in each bedroom Layout/Condition of Interior Partitions • Paint flaking off of walls and ceiling in first floor bathroom (due to excessive moisture/humidity) Similar Factors • Portions of basement level have only approximately 6'-0" ceiling height -considered too low for habitable space according to building code • Defects in exterior building shell: Exterior wood siding in need of paint; window frames extremely weathered - in need of paint Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandazd if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $221,398.88 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $32,923.00 Percentage of Code Deficiency to Replacement Cost: 14.87% Refer to Individual Building Summary Report for documentation of specific code deficiencies. • • Report on Structurally Substandard Building Building IDBusiness Name/Address: Satisfies Conditions Test for Structurally Substandard Building: Satisfies Code Test for Structurally Substandard Building: Structurally Substandard Building (Y/l~: Conditions Test 7609 Aldrich Ave. S. 2 N Y N Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." The above building, based upon exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Light & Ventilation • Deficient in meeting Mechanical code: for residential construction prior to 1980, plumbing systems contain lead soldered connections, which aze non-compliant with current building code • Deficient in meeting Electrical code: for residential construction prior to 1980, receptacle locations, receptacle types, and wiring aze non-compliant with current building code Fire Protection/Egress • Deficient emergency egress: lack of basement emergency egress windows Similar Factors • Inadequate soffit ventilation provided Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandazd if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same squaze footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $97,849.79 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $17,782.56 Percentage of Code Deficiency to Replacement Cost: 18.17% Refer to Individual Building Summazy Report for documentation of specific code deficiencies. • • Report on Structurally Substandard Building Building IDBusiness Name/Address: 7615 Aldrich Ave. S. 3 Satisfies Conditions Test for Structurally Substandard Building: y Satisfies Code Test for Structurally Substandazd Building: N Structurally Substandazd Building (Y/1~: N Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Moisture infiltration into basement foundation wall causing spalling/deterioration on interior concrete block wall face at east and north walls Light & Ventilation . Deficient in meeting Mechanical code: for residential construction prior to 1980, plumbing systems contain lead soldered connections, which aze non-compliant with current building code • Deficient in meeting Electrical code: for residential construction prior to 1980, receptacle locations, receptacle types, and wiring are non-compliant with current building code Fire Protection/Egress • Deficient emergency egress: lack of basement emergency egress windows • Deficient interior stairway: insufficient headroom provided; deficient handrail height and returns; deficient guazdrail construction • Lack of smoke detector/detection system in each bedroom Similar Factors • Inadequate attic and soffit ventilation provided • Defects in exterior building shell: several minor horizontal cracks in exterior stucco finish on east wall, one large azea beginning to `delaminate' from the wall; minor stress cracks in stucco at window sills; wood fascia board bowed from wall (2" +) on east side Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandazd if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same squaze footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $106,160.58 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $15,671.76 Percentage of Code Deficiency to Replacement Cost: 14.76% Refer to Individual Building Summary Report for documentation of specific code deficiencies. U U • Report on Structurally Substandard Building Building IDBusiness Name/Address: Satisfies Conditions Test for Structurally Substandard Building: Satisfies Code Test for Structurally Substandard Building: Structurally Substandard Building (Y/l~: Conditions Test 7621 Aldrich Ave. S. 4 Y Y Y Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or cleazance: Structural Elements • Exterior concrete block foundation spalling/deteriorating just above grade entire perimeter • Horizontal crack present in mid-point of basement foundation wall on north, east, and south walls; wall face deteriorated by moisture and some azeas appeaz to have mold Light & Ventilation • Deficient in meeting Mechanical code: for residential construction prior to 1980, plumbing systems contain lead soldered connections, which are non-compliant with current building code • Deficient in meeting Electrical code: for residential construction prior to 1980, receptacle locations, receptacle types, and wiring aze non-compliant with current building code Fire Protection/Egress • Deficient emergency egress: lack of basement emergency egress windows • Deficient interior stairway: insufficient landing length; insufficient headroom provided; deficient handrail height and returns; handrail not continuous • Lack of smoke detector/detection system in each bedroom Layout/Condition of Interior Partitions • Ceiling in hallway stained/damaged by past ceiling leaks; building settlement cracks evident in hallway above door frames and in hall and dining room ceilings Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $97,849.79 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $19,811.66 Percentage of Code Deficiency to Replacement Cost: 20.25% Refer to Individual Building Summary Report for documentation of specific code deficiencies. Report on Structurally Substandard Building Building ID/Business Name/Address: 7627 Aldrich Ave. S. 5 Satisfies Conditions Test for Structurally Substandazd Building: N Satisfies Code Test for Structurally Substandard Building: N Structurally Substandard Building (Y/I~: N Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or cleazance: Light & Ventilation • Deficient in meeting Mechanical code: for residential construction prior to 1980, plumbing systems contain lead soldered connections, which are non-compliant with current building code • Deficient in meeting Electrical code: for residential construction prior to 1980, receptacle locations, receptacle types, and wiring aze non-compliant with current building code • Toilet room lacks means of natural or mechanical ventilation Fire Protection/Egress • Deficient emergency egress: lack of basement emergency egress windows • Deficient interior stairway: insufficient headroom provided; deficient handrail returns; handrail is not continuous; deficient guazdrail construction • Lack of smoke detector/detection system on an individual floor and in each bedroom LayouUCondition of Interior Partitions • Severe moisture damage to ceiling and walls in shower azea Similaz Factors • Inadequate soffit ventilation provided Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandazd if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $104,132.92 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $14,911.66 Percentage of Code Deficiency to Replacement Cost: 14.32% Refer to Individual Building Summary Report for documentation of specific code deficiencies. r: • Report on Structurally Substandard Building Building IDBusiness Name/Address: Satisfies Conditions Test for Structurally Substandard Building: Satisfies Code Test for Structurally Substandard Building: Structurally Substandard Building (Y/N): Conditions Test 7633 Aldrich Ave. S. 6 Y N N Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance: ' The above building, based upon exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Roof sheathing sagging/deflecting along eave on east side Light & Ventilation • Deficient in meeting Mechanical code: for residential construction prior to 1980, plumbing systems contain lead soldered connections, which are non-compliant with current building code • Deficient in meeting Electrical code: for residential construction prior to 1980, receptacle locations, receptacle types, and wiring are non-compliant with current building code Fire Protection/Egress • Deficient emergency egress: lack of basement emergency egress windows • Deficient exterior door: deficient threshold height Similar Factors • Defects in exterior building shell: roof shingles appear severely worn and in need of replacement; approximately half of wood fascia is rotting; paint deteriorating on front door and windows Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $111,127.47 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $16,523.52 Percentage of Code Deficiency to Replacement Cost: 14.87% Refer to Individual Building Summary Report for documentation of specific code deficiencies. Report on Structurally Substandard Building Building IDBusiness Name/Address: 7639 Aldrich Ave. S. 7 Satisfies Conditions Test for Structurally Substandard Building: Y Satisfies Code Test for Structurally Substandard Building: Y Structurally Substandard Building (Y/N): Y Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Moisture infiltration into basement foundation wall causing spalling/deterioration on interior concrete block wall face on east side Light & Ventilation • Deficient in meeting Mechanical code: for residential construction prior to 1980, plumbing systems contain lead soldered connections, which are non-compliant with current building • code • Deficient in meeting Electrical code: for residential construction prior to 1980, receptacle locations, receptacle types, and wiring are non-compliant with current building code Fire Protection/Egress • Deficient exterior stairway: deficient rise/run • Deficient emergency egress: lack of basement emergency egress windows • Deficient interior stairway: insufficient stairway width; insufficient headroom provided; deficient handrail height and returns • Lack of smoke detector/detection system in each bedroom LayoudCondition of Interior Partitions • Moisture damage to ceiling in shower area Similar Factors • Inadequate attic and soffit ventilation provided • Defects in exterior building shell: side screen door does not close properly; front door sill is rotted; cracking evident in stucco finish at foundation line on north and south sides; lack of downspout extension causing deterioration to stucco finish at southeast comer; wood fascia board bowed from wall (2" +) on east side Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $104,132.92 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $22,332.56 • Percentage of Code Deficiency to Replacement Cost: 21.45% Refer to Individual Building Summary Report for documentation of specific code deficiencies. • Report on Structurally Substandard Building Building IDBusiness Name/Address: 7600 Lyndale Ave. S. 8 Satisfies Conditions Test for Structurally Substandard Building: N Satisfies Code Test for Structurally Substandard Building: N Structurally Substandazd Building (Y/1~: N Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or cleazance." The above building, based upon exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or cleazance: Structural Elements • Attached wood framed lean-to on west side in disrepair: walls and roof are sagging/deflecting or bowing Essential Utilities & Facilities • Deficient in facilities for disabled: no designated van accessible parking available; lack of exterior accessible route to entrance Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges Fire ProtectionBgress • Deficient exterior door: door does not swing in direction of travel; deficient threshold height • Lack of smoke detector/detection system on an individual floor and in each bedroom Similar Factors • Interior window sills damaged from previous moisture leakage • Defects in exterior building shell: minor vertical and horizontal cracking over entire stucco finish on north wall; some portions of stucco finish missing; all wood siding in need of paint; lean-to wood siding is no longer weather-tight Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $394,848.00 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $48,520.32 Percentage of Code Deficiency to Replacement Cost: 12.29% S Refer to Individual Building Summary Report for documentation of specific code deficiencies. Report on Structurally Substandard Building Building ID/Business Name/Address: 7608 Lyndale Ave. 5. 9A Satisfies Conditions Test for Structurally Substandazd Building: Y Satisfies Code Test for Structurally Substandard Building: Y Structurally Substandard Building (Y/l~: I' Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Vertical settlement cracks (through individual concrete blocks) occur from foundation to parapet on south wall; moisture deterioration (spalling, missing mortar joints) to exterior wall caused by lack of downspout on west wall • Steel bottom plate on overhang header is severely rusted and is sagging; mortar joints missing at beam bearing condition • Evidence of minor moisture infiltration to interior of basement foundation wall; some settlement cracks present in foundation wall Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability parking available; lack of accessible hazdwaze at entrance; lack of maneuvering cleazance and accessible features in toilet room • Building azea and occupancy require additional toilet room fixtures Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges • Toilet room lacks means of natural or mechanical ventilation Fire Protection/Egress • Deficient emergency egress: lack of basement and bedroom emergency egress windows • Deficient exterior door: deficient threshold height • Deficient interior stairway: deficient rise/run; insufficient headroom provided; additional handrail required; deficient handrail height, returns, and extensions; deficient guardrail construction • Lack of smoke detector/detection system on an individual floor and in each bedroom Layout/Condition of Interior Partitions • Ceiling tiles damaged by moisture at west wall; several cracks in finish wall surfaces Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $309,640.32 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $72,028.88 Percentage of Code Deficiency to Replacement Cost: 23.26% Refer to Individual Building Summary Report for documentation of specific code deficiencies. • Report on Structurally Substandard Building Building IDBusiness Name/Address: 7610/7612 Lvndale Ave. S. 9B Satisfies Conditions Test for Structurally Substandard Building: Y Satisfies Code Test for Structurally Substandard Building: Y Structurally Substandard Building (Y/I~: Y Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance: ' The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Steel bottom plate on overhang header is severely rusted and is sagging Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability parking available; no exterior accessible route to entrance; lack of maneuvering cleazance at entrance doors; lack of accessible hazdwaze at interior doors; lack of maneuvering cleazance and accessible features at toilet rooms Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges • Toilet rooms lack means of natural or mechanical ventilation • Toilet fixture lacks adjacent non-absorbent wall surface Fire Protection/Egress • Deficient exterior door: deficient threshold height Layout/Condition of Interior Partitions • Vertical settlement cracks in finish of common wall between 7612 and 7610 and between 7610 and 7608 • Relatively narrow office azea for multi-tenant configuration in 7610 Similaz Factors • Defects in exterior building shell: foundation block cores exposed at east wall; wood storefront window and door trim and door in need of paint • Approximately half of ceiling tiles in 7612 and in front azea of 7610 damaged by roof leaks Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandazd if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same squaze footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $274,255.46 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $79,460.04 Percentage of Code Deficiency to Replacement Cost: 28.97% Refer to Individual Building Summary Report for documentation of specific code deficiencies. • Report on Structurally Substandard Building Building IDBusiness Name/Address: Satisfies Conditions Test for Structurally Substandazd Building: Satisfies Code Test for Structurally Substandard Building: Structurally Substandazd Building (Y/N): Conditions Test N Y N Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance: ' The above building, based upon exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Three diagonal settlement cracks extend from foundation to pazapet in exterior wall at northwest corner Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability parking available; lack of maneuvering clearance at entrance; lack of accessible hazdwaze at interior doors; lack of maneuvering clearance and accessible features at toilet rooms Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges Fire Protection/Egress • Deficient exterior stairway: deficient rise/run; additional handrails required • Deficient exterior door: deficient threshold height; deficient landing azea Similaz Factors • Defects in exterior building shell: foundation block cores exposed at east wall • Approximately half of ceiling tiles damaged by roof leaks Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandazd if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $172,694.59 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $37,001.04 Percentage of Code Deficiency to Replacement Cost: 21.43% Refer to Individual Building Summary Report for documentation of specific code deficiencies. 7614 Lyndale Ave. 5. l0A • Report on Structurally Substandard Building Building IDBusiness Name/Address: 7616/7618A/7618B/7618R Lyndale Ave. S. lOB Satisfies Conditions Test for Structurally Substandazd Building: Y Satisfies Code Test for Structurally Substandard Building: Y Structurally Substandard Building (Y/1~: Y Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or cleazance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or cleazance: Structural Elements • Severe exterior wall deterioration (spalling) on west concrete masonry wall due to lack of downspout; major moisture deterioration (spalling, missing mortar joints) on south wall; moisture deterioration at northwest corner to exposed foundation block and causing settlement to adjacent sidewalk Essential Utilities & Facilities • Building area and occupancy require additional toilet fixtures (video store does not have own bathroom -must access bathroom in vacant office space through a makeshift moveable section of wall partition) • Deficient in facilities for disabled: no designated disability parking available; lack of maneuvering cleazance at entrance door; lack of accessible hazdwaze at interior doors; lack of landing azea at interior ramps; lack of maneuvering cleazance and accessible features at toilet room; inaccessible service counter (height) • Toilet fixture lacks adjacent non-absorbent wall surface Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges Fire Protection/Egress • Deficient exterior stairway: deficient rise/run; additional handrails required • Deficient exterior door: lack of door landing azea Similar Factors • Loading dock stairway and platform aze unusable in current condition • Defects in exterior building shell: roof fascia damaged bowed from face of building on north wall; exterior masonry west wall in need of paint • Majority of ceiling tiles damaged in 7618A & B back room and at 7618B east wall due to roof leaks Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandazd if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same squaze footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $563,436.00 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $98,897.88 Percentage of Code Deficiency to Replacement Cost: 17.55% Refer to Individual Building Summary Report for documentation of specific code deficiencies. Report on Structurally Substandard Building Building ID/Business Name/Address: 7620A/7620B/7622 Lyndale Ave. S. 11A Satisfies Conditions Test for Structurally Substandard Building: Y Satisfies Code Test for Structurally Substandard Building: Y Structurally Substandard Building (Y/N): Y Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fue protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Two major vertical wall cracks occurring between 7620 and adjacent building (7626) and at southwest corner of building; top three courses of exterior south wall aze displaced with missing mortar joints -wall appears to be missing cap flashing at top Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability parking available; lack of exterior accessible route to entrance; lack of maneuvering cleazance at entrance door; lack of accessible hazdwaze at interior doors; lack of maneuvering clearance and accessible features in toilet rooms • Toilet fixtures lack adjacent non-absorbent wall surfaces Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges Fire Protection/Egress • Deficient exterior door: deficient threshold height Similar Factors • Defects in exterior building shell: sheet metal soffit not properly fastened and is sagging and being damaged by entrance doors when opened; enclosed canopy structure is not ventilated properly; entire front metal canopy in need of paint; reaz door wood laminate destroyed by moisture • Small amount of ceiling tiles damaged by roof leaks in insurance office; permanently fabricated sheet metal diverter used in 7620B to divert interior roof leakage; finished walls and ceiling surfaces in 7620B loading/shop area in generally poor condition Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $421,457.04 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $66,857.28 Percentage of Code Deficiency to Replacement Cost: 15.86% Refer to Individual Building Summary Report for documentation of specific code deficiencies. • Report on Structurally Substandard Building Building IDBusiness Name/Address: 7624/7626 Lyndale Ave. S. 11B Satisfies Conditions Test for Structurally Substandazd Building: Y Satisfies Code Test for Structurally Substandard Building: Y Structurally Substandard Building (Y/IS7: Y Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies aze of sufficient total significance to justify substantial renovation or cleazance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Exterior light visible through several cracks in exterior wall of 7626 storage room; interior concrete floor settlement (1" +) at loading dock azea -exterior grade at loading dock area noticeably settled downward and has caused major damage to building structure Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability parking available; lack of accessible hazdwaze at interior doors; lack of maneuvering cleazance and accessible features in toilet rooms; inaccessible service counter (height) Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges Fire Protection/Egress • Deficient exterior stairway: deficient rise/run • Deficient exterior door: deficient threshold height Layout/Condition of Interior Partitions • Two major vertical cracks (1" +) in common wall between 7626 and 7620B Similar Factors • Approximately 75% of ceiling tiles in need of replacement (warping/sagging) in 7626 merchandise area • Defects in exterior building shell: sheet metal soffit not properly fastened and is sagging and being damaged by entrance doors when opened; enclosed canopy structure is not ventilated properly; entire front metal canopy in need of paint Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $379,311.34 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $71,264.52 Percentage of Code Deficiency to Replacement Cost: 18.79% Refer to Individual Building Summary Report for documentation of specific code deficiencies. Report on Structurally Substandard Building Building IDBusiness Name/Address: 7628/7628-1/2 Lyndale Ave. S. 12 Satisfies Conditions Test for Structurally Substandard Building: N Satisfies Code Test for Structurally Substandazd Building: Y Structurally Substandard Building (Y/l~: N Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or cleazance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability pazking available; lack of maneuvering clearance at entrance door; lack of accessible hazdwaze at interior doors; lack of maneuvering clearance and accessible features at toilet room; inaccessible service counter (height) Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges Fire Protection/Egress • Deficient exterior stairway: deficient handrail returns • Deficient emergency egress: lack of bedroom emergency egress windows • Deficient exterior door: deficient threshold heights • Deficient interior stairway: deficient landing area; deficient handrail height and returns • Lack of smoke detector/detection system in each bedroom • Lack of required fire protection for openings above adjacent building lower roof Similar Factors • Ceiling tiles damaged in entry alcove; approximately half of ceiling tiles damaged in back room azea; ceiling and walls damaged by roof leaks at front of upper level; jambs and sills of front window in upper level damaged by moisture; upper level bedroom window sills are rotting; lower level interior carpet in poor condition (bubbles, stains) • Defects in exterior building shell: second floor window frames in need of paint; several areas of stucco finish delaminating from west building wall; upper level wood siding in need of paint on west wall Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same squaze footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $247,154.80 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $47,413.80 . Percentage of Code Deficiency to Replacement Cost: 19.18% Refer to Individual Building Summary Report for documentation of specific code deficiencies. Report on Structurally Substandard Building Building ID/Business Name/Address: 7630/7630-1/2 Lyndale Ave. S. 13 Satisfies Conditions Test for Structurally Substandard Building: Y Satisfies Code Test for Structurally Substandard Building: Y Structurally Substandard Building (Y/N): I' Conditions Test -Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Steel bottom plates on overhang header and above 2°d floor windows are rusting; entire exterior concrete masonry wall (south and west walls) in extremely poor condition (paint flaking, settlement cracks, various holes, poor mortar joints, block deterioration) • Second floor concrete roof patio structure failing -sagging and ponding water, which leaks through first floor back room and into basement space Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability parking available; lack of accessible hardware at interior doors; lack of maneuvering clearance and accessible features at toilet room Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges • Toilet room lacks means of natural or mechanical ventilation Fire Protection/Egress • Deficient exterior stairway: deficient handrail height; deficient guardrail construction • Deficient exterior door: deficient landing area • Deficient interior stairway: insufficient stairway width provided; deficient rise/run; deficient landing area; insufficient headroom provided; additional handrails required; deficient handrail height and returns; handrails are not continuous • Lack of required fire protection for openings above adjacent building lower roof Layout/Condition of Interior Partitions • First floor back room space and finishes completely ruined by roof leakage from second floor roof patio; front store area finishes poorly maintained Similar Factors • First floor rear door and frame completely rotted out -unusable and marginally secure • Several areas of damage to ceiling finish of second floor apartment due to continuing roof leakage Code Test -Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $465,982.63 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $79,227.24 Percentage of Code Deficiency to Replacement Cost: 17.00% Refer to Individual Building Summary Report for documentation of specific code deficiencies. Report on Structurally Substandard Building Building ID/Business Name/Address: 7632/7632A/7632-1/2 Lvndale Ave. S. 14 Satisfies Conditions Test for Structurally Substandard Building: Y Satisfies Code Test for Structurally Substandard Building: Y Structurally Substandard Building (Y/l~: Y Conditions Test -Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Minor settlement cracking in lower level west wall; second floor exterior concrete masonry wall in poor condition (paint flaking, settlement cracks, various holes, poor mortar joints, block deterioration) Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability parking available; lack of maneuvering clearance at entrance door; lack of maneuvering clearance and accessible hardware at interior doors; lack of maneuvering clearance and accessible features at toilet room; inaccessible service counter (height) • Efficiency apartment electrical service less than 100 amp minimum capacity Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges Fire Protection/Bgress • Deficient emergency egress: lack of bedroom emergency egress window • Deficient interior stairway: deficient rise/run; deficient handrail height and returns • Lack of smoke detector/detection system on an individual floor and in each bedroom Layout/Condition of Interior Partitions • Relatively narrow space (8'-0" wide maximum) for efficiency apartment -apartment does not even contain a kitchenette or bathing facility • Poor loading/delivery access to food market • Second floor apartment: ceiling damage (roof leaks) in entry; walls in hall and entry in poor condition Similar Factors • Defects in exterior building shell: stucco finish not weather tight at storefront window sill; corrugated metal canopy and wood signage in poor condition; second floor apartment entry door in poor condition Code Test -Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $353,385.18 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $65,700.00 Percentage of Code Deficiency to Replacement Cost: 18.59% Refer to Individual Building Summary Report for documentation of specific code deficiencies. • Report on Structurally Substandard Building Building IDBusiness Name/Address: 7634/7636 Lyndale Ave. S. 15 Satisfies Conditions Test for Structurally Substandazd Building: Y Satisfies Code Test for Structurally Substandard Building: Y Structurally Substandard Building (Y/1~: Y Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or cleazance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or cleazance: Structural Elements • Steel bottom plate on overhang header is rusting and warped; approximately half of mortar joints in exterior wall of 7634 need to be retooled; severe exterior wall deterioration due to water and lazge diagonal settlement crack at southwest corner of 7636; also major diagonal settlement crack at northwest corner of 7636; lazge wall crack at exterior wall intersection between 7636 and adjacent 7634 & 7638 Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability parking available; lack of maneuvering cleazance and accessible hazdwaze at interior doors; lack of maneuvering cleazance and accessible features in toilet rooms • Toilet fixture lacks adjacent non-absorbent wall surface Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges • Toilet room lacks means of natural or mechanical ventilation Fire Protection/Egress • Deficient exterior stairway: deficient rise/run; deficient guazdrail construction Layout/Condition of Interior Partitions • Finish flooring in poor condition or missing in 7634, approximately 25% of wall and ceiling finishes in poor condition in 7634; walls in poor condition in back room of 7636 -back room mop sink unusable in current condition Similar Factors • Back stairs and landing platform unusable in current condition • Defects in exterior building shell: wood roof fascia board rotting on west wall between 7634 and 7636 Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandazd if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $224,091.79 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $52,287.26 • Percentage of Code Deficiency to Replacement Cost: 23.33% Refer to Individual Building Summary Report for documentation of specific code deficiencies. • • • Report on Structurally Substandard Building Building ID/Business Name/Address: Satisfies Conditions Test for Structurally Substandard Building: Satisfies Code Test for Structurally Substandard Building: Structurally Substandard Building (Y/I~: 7638/7640 Lyndale 16 Y Y Y Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies aze of sufficient total significance to justify substantial renovation or clearance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Steel bottom plate on overhang header is rusting and warped; major settlement crack in exterior west wall between 7638 and 7640; various other minor horizontal and vertical settlement cracks on west wall Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability parking available; lack of maneuvering clearance at entrance door; lack of maneuvering cleazance and accessible hazdwaze at interior doors; lack of maneuvering clearance and accessible features at toilet rooms; inaccessible service counter (height) • Toilet fixture lacks adjacent non-absorbent wall surface Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges • Toilet rooms lack means of natural or mechanical ventilation Fire Protection/Egress • Deficient exterior stairway: deficient rise/run; deficient handrail returns and extensions • Deficient exterior door: deficient threshold height Layout/Condition of Interior Partitions • Interior walls and ceiling of furnace room in 7638 damaged by moisture infiltration through exterior wall and/or roof; carpeting in 7638 generally worn and in need of replacement; backroom walls and ceilings in 7640 damaged by roof leaks • Toilet room in 7640 also contains electrical service panels Similaz Factors • Defects in exterior building skin: lazge gap between wood roof edge board and concrete masonry unit wall at juncture of 7640 and 7642 Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $185,029.92 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $52,142.20 Percentage of Code Deficiency to Replacement Cost: 28.18% Refer to Individual Building Summary Report for documentation of specific code deficiencies. S Report on Structurally Substandard Building Building IDBusiness Name/Address: 7642/7642-1/2 Lyndale Ave. S. 17 Satisfies Conditions Test for Structurally Substandard Building: Y Satisfies Code Test for Structurally Substandard Building: Y Structurally Substandazd Building (Y/I~: Y Conditons Test -Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similaz factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Steel bottom plate on overhang header is rusting and warped; top three courses of west exterior wall are displaced/cracked horizontally above second floor windows • Masonry retaining wall severely displaced at mid-height and appeazs in danger of collapsing Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability pazking available; lack of maneuvering cleazance at entrance doors; lack of maneuvering clearance and accessible hazdwaze at interior doors; lack of maneuvering clearance and accessible features at toilet rooms • Toilet room lacks non-absorbent floor surface • Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges Fire Protection/Egress • Insufficient exit sepazation for existing exits in basement area • Deficient exterior stairway: deficient handrail returns; deficient guazdrail construction • Deficient interior stairway: deficient rise/run; insufficient landing azea; deficient handrail height, returns, and extensions • Lack of required fire protection for openings above adjacent building lower roof Layout/Condition of Interior Partitions • Approximately 25% of ceiling file damaged by moisture in first floor, much water damage in back break room space; first floor carpeting badly worn Similar Factors • Building lacks an accessible means of access to second floor (elevator) business(es) for convenience of public • Defects in exterior building skin: north and west exterior wall in need of paint; back door veneer is missing/damaged on lower portion of door Code Test -Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same squaze footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $357,259.68 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $98,679.70 Percentage of Code Deficiency to Replacement Cost: 27.62% • Refer to Individual Building Summazy Report for documentation of specific code deficiencies. • Report on Structurally Substandard Building Building IDBusiness Name/Address: 7644/7644-1/2 Lyndale Ave. S. 18 Satisfies Conditions Test for Structurally Substandard Building: Y Satisfies Code Test for Structurally Substandard Building: I' Structurally Substandard Building (Y/1~: Y Conditions Test Under the tax increment law, specifically, Minnesota Statutes, Section 469.174, Subdivision 10, a building is structurally substandard if it contains "defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similaz factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or cleazance." The above building, based upon actual interior and exterior inspection and review of building permit records, exhibits the following deficiencies that contribute to justifying substantial renovation or clearance: Structural Elements • Steel bottom plate on overhang header is rusting and wazped Essential Utilities & Facilities • Deficient in facilities for disabled: no designated disability pazking available; lack of maneuvering clearance at entrance doors; lack of accessible hazdwaze at interior doors; lack of maneuvering cleazance and accessible features in toilet rooms • Toilet fixtures lack adjacent non-absorbent wall and floor surfaces . Light & Ventilation • Deficient in meeting Mechanical code: for building construction prior to 1989, mechanical systems do not provide sufficient number of air exchanges Fire Protection/Egress • Additional means of egress required from basement level • Insufficient exit corridor width • Deficient exterior stairway: deficient handrail returns; handrails are not continuous • Deficient interior stairway: deficient rise/run; deficient landing azea; deficient handrail height, returns, and extensions Layout/Condition of Interior Partitions • Major moisture damage to east interior wall below wall unit air conditioning on second level; water damage present at window second level window sill; cazpet generally worn on second level Similaz Factors • Building lacks an accessible means of access to second floor (elevator) business(es) for convenience of public Code Test Notwithstanding the foregoing, the tax increment law also provides that a building may not be considered structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of the same square footage and type on the same site. Estimated cost of new building of same size and type (Total Replacement Cost): $389,336.11 Estimated cost of correction of code deficiencies (Total Deficiency Cost): $90,638.88 Percentage of Code Deficiency to Replacement Cost: 23.28% Refer to Individual Building Summary Report for documentation of specific code deficiencies. E"' o o ~ v a00o o oo °o °o °o o °o ~ o~ o a: o ao ~ m a^o , 0 o ri o f/1 In O (~ V) O O d M ~ M ~ ~ O~ .~i ~ O~ C7 O O U N ~ ~ ~ .ti N N Cq N V! 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C9 ° M > , C W m ~ ~ Q O C~ X a ` m m C O "O n °' C O a n U C C "~ m ~~ C 'p O/ C C •O 'C ~ •O y H O N L O m 22 22 ilM Clh '~ C'C V Nr ~~ V N >O ~ alp "~ dlp ~ 0 ~ ~ ~ O) ~L ~ ~L m ~~"m C «d C O O m 0 7 •lC C fn m Cn r Cn r m m n) C r0 O H O ~. HOD ~ O ~ ' O E in In m~ 0 tnD O LL h w j O ln0 W O LL t~ fA to ~ O G~ r LL 7 U O X a LL m O O m T LL E y O 0~ 0 O LL 0 O 09 . a - m ~7 C ai m _ m W = N N O O O n v v v o 0 0 U C Q m N C ~ y x O. y ~C lL ~_ O ~ ~ ~ LL LL Y a ~d '. > > m m H J ~ J ~ O W W W W W W U ~ ~ ~ ~ ~ ~ M a Attachment D • ,-~s ufDcrc~~ther ', ZUU? ~YCIfI f )T ~ ~OllilCl~ ~~L'l'IN ~L' MODIFICATION TO THE REDEVELOPMENT PLAN FOR THE RICHFIELD REDEVELOPMENT PROJECT AREA and the MODIFICATION TO THE TAX INCREMENT FINANCING PLAN FOR THE INTERCHANGE WEST AND LYNDALE GATEWAY TAX INCREMENT FINANCING DISTRICT and the TAX INCREMENT FINANCING PLAN n U for the establishment of THE LYNDALE GATEWAY WEST TAX INCREMENT FINANCING DISTRICT (a redevelopment district) within THE RICHFIELD REDEVELOPMENT PROJECT AREA RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY CITY OF RICHFIELD HENNEPIN COUNTY STATE OF MINNESOTA Public Hearing: December 10, 2002 Adopted: ~ EHLERS Prepared by: EHLERS & ASSOCIATES, INC. 3060 Centre Pointe Drive, Roseville, Minnesota 55113-1105 & ASSOCIATES i N c 651-697-8500 fax: 651-697-8555 WWW.ehlers-inc.com • TABLE OF CONTENTS (for reference purposes only} SECTION I -MODIFICATION TO THE REDEVELOPMENT PLAN FOR THE RICHFIELD REDEVELOPMENT PROJECT AREA ...................... 1-1 Foreword ............................................................... 1-1 Statement of Public Purpose ................................................ 1-1 Boundaries of the Richfield Redevelopment Project Area .......................... 1-1 Parcels in Acquisition ....................................................... 1-1 Development Activities in the Richfield Project Area .............................. 1-1 SECTION II -MODIFICATION TO THE TAX INCREMENT FINANCING PLAN FOR THE INTERCHANGE WEST AND LYNDALE GATEWAY TAX INCREMENT FINANCING DISTRICT ..................................... 2-1 Description of Property in the District .......................................... 2-1 SECTION III -TAX INCREMENT FINANCING PLAN FOR THE LYNDALE GATEWAY WEST TAX INCREMENT FINANCING DISTRICT ............ . 3-2 Subsection 3-1. Foreword ............................................... . 3-2 Subsection 3-2. Statutory Authority ........................................ . 3-2 Subsection 3-3. Statement of Objectives .............. .................... . 3-2 Subsection 3-4. Redevelopment Plan Overview .........~ ..................... . 3-2 Subsection 3-5. Description of Property in the District and Property To Be Acquired .. . 3-3 Subsection 3-6. Classification of the District ................................. . 3-3 Subsection 3-7. Duration of the District ..................................... . 3-5 • Subsection 3-8. Original Tax Capacity, Tax Rate and Estimated Captured Net Tax Capacity Value /Increment and Notification of Prior Planned Improvements ......... . 3-5 Subsection 3-9. Sources of Revenue/Bonded Indebtedness ..................... . 3-6 Subsection 3-10. Uses of Funds ........................................... . 3-7 Subsection 3-11. State Tax Increment Financing Aid (Local Contribution) ........... . 3-7 Subsection 3-12. Fiscal Disparities Election ................................... . 3-7 Subsection 3-13. Business Subsidies ....................................... . 3-8 Subsection 3-14. County Road Costs ....................................... . 3-8 Subsection 3-15. Estimated Impact on Other Taxing Jurisdictions ................. . 3-8 Subsection 3-16. Supporting Documentation .................................. . 3-9 Subsection 3-17. Definition of Tax Increment Revenues ......................... 3-10 Subsection 3-18. Modifications to the District ................................. 3-10 Subsection 3-19. Administrative Expenses ................................... 3-10 Subsection 3-20. Limitation of Increment ..................................... 3-11 Subsection 3-21. Use of Tax Increment ...................................... 3-12 Subsection 3-22. Excess Tax Increments .................................... 3-13 Subsection 3-23. Requirements for Agreements with the Developer ................ 3-13 Subsection 3-24. Assessment Agreements ................................... 3-13 Subsection 3-25. Administration of the District ................................. 3-14 Subsection 3-26. Annual Disclosure Requirements ............................. 3-14 Subsection 3-27. Reasonable Expectations ................................... 3-14 Subsection 3-28. Other Limitations on the Use of Tax Increment .................. 3-14 Subsection 3-29. Summary ............................................... 3-15 APPENDIX A -PROJECT DESCRIPTION ........................................ A-1 APPENDIX B -MAP OF THE RICHFIELD REDEVELOPMENT PROJECT AREA AND THE LYNDALE GATEWAY WEST TIF DISTRICT ........................... B-1 APPENDIX C -DESCRIPTION OF PROPERTY TO BE INCLUDED IN THE DISTRICT ..... C-1 '~ APPENDIX D -ESTIMATED CASH FLOW FOR THE DISTRICT ....................... D-1 APPENDIX E- ..............................................................E-1 APPENDIX F- .............................................................. F-1 APPENDIX G -PRIOR PLANNED IMPROVEMENTS ..:...................:......... G-1 • SECTION I -MODIFICATION TO THE REDEVELOPMENT PLAN FOR THE R1CHFlELD REDEVELOPMENT PROJECT AREA Foreword The following text represents a Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area. This modification represents a continuation of the goals and objectives set forth in the Redevelopment Plan forthe Richfield RedevelopmentProject Area. Generally, the substantive changes include the establishment of the Lyndale Gateway West Tax Increment Financing District. For further information, a review of the Redevelopment Plan for the Richfield Redevelopment Project Area, adopted June 14,1993, is recommended. It is available in the Community Development Department at the City of Richfield. Other relevant information is contained in the Tax Increment Financing Plans for the Tax Increment Financing Districts located within the Richfield Redevelopment Project Area. Statement of Public Purpose A comprehensive review on the portion of the Richfield Redevelopment Project Area comprising-the Lyndale Gateway West TIF District discloses that such portion is blighted within the meaning of1l~S. Sections 469.002 Subd. 11 and 469.028 Subd. 3. See also the Statement of Public Purpose found in Section B of the Redevelopment Plan for the Richfield Redevelopment Project Area, dated June 14, 1993. Boundaries of the Richfield Redevelopment Project Area The boundaries for the Richfield Redevelopment Project Area are not being modified. See Appendix A of the Tax Increment Financing Plan for the Lyndale Gateway West Tax Increment Financing District for a map of the Richfield Redevelopment Project Area. Parcels in Acquisition The HRA or City may acquire the parcels in the Tax Increment Financing Plan for the Lyndale Gateway West Tax Increment Financing District. However, it is anticipated that the developers will be responsible for acquisition. Development Activities in the Richfield Project Area The Redevelopment Plan for the Richfield Redevelopment Project Area is hereby modified to include redevelopment and development activities to facilitate the construction of the following projects: a. Ownership townhomes b. Ownership condominiums c. Commercial/retail space d. Parking facility e. Public facilities f. Public utilities g. Public roadways, sidewalks and streetscape • Richfield Housing and Redevelopment Authority Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area 1-1 • SECTION l1-MODIFICATION TO THE TAX INCREMENT FINANCING PLAN FOR THE INTERCHANGE WEST AND LYNDALE GATEWAY TAX INCREMENT FINANCING DISTRICT Description of Property in the District (AS MODIFIED ONDECEMBER 10, 2002) The Interchange West and Lyndale Gateway Tax Increment Financing District, a scattered site redevelopment district, was established on June 14, 1999, and modified on January 22, 2001. The District is being modified to eliminate the following parcel numbers, and therefore reducing the size of the Interchange West and Lyndale Gateway Tax Increment Financing District. • Richfield Housing and Redevelopment Authority Modification to the Tax Increment Financing Plan for the Interchange West and Lyndale Gateway Tax Increment Financing District 2-1 • • ~' OOOOtnOOOtt~OOO0000 n OOtn~'OaO~~t (O M H ~~NOCON6>NMMU)o~r~c0 (p NNrOr V N•- •- OD X U M M to r r r r r M r r v ~' N r N N N r N N M h W Q a N r v r M v Q Z U W W L7. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O LL ~ W O O O O O O O O O O O O O O O O O O O O O N O O N N ~ Y~ ooooornooooooaooo n u~o~voao~n~ r ao Q.J f~nCfllnrN(flNOOOOrON c0 ~NrO~~N d' ' N Q r r N r r r r r r M M r N N N r N N ~ 00 Q ~ r r v r N } OOOONOtAOtAtntnOOlnO O toONOOOOO M LLl H r M to tt) M A N M O r M CO OD n ' O n N 0 N O n n r M (~ COn~t~COMaoNMt! )nooN~tn N Mraoaonooaooo t.f) '' m~ a N N d' '~ r ~ ~ r r N r (fl ~= U Q ~" a ~.- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 e o 0 0 Q ~W 00000 00 0000 0 000 o 0 00 0 0 0 0 0 0 0 0 ~ooooo0 U W d N N N N N p N O N N N O p N N N 0 0 0 0 0 0 0 X n. }. o b o 0 00 0o b o boo b o o ~~o o •o •0 0 0 •0 0 00000000 0 Q UI- tptntAMtArtnrtntl')tnNrts)~ ln~~~~~~r a r r r r r r r r r r r r w N m HW w 000000000000000 OOOOOOOOOOOOOOO 000000000000000 0 O 0 00000000 oooooaooo ooc oo~noo 0 oo n W (nY= aO~O~ai~t~Mn<-OiM~-~ao CO ~ ~riNONO>nn~ N Q~ NOMtnNCOO~~NO ~~ MaOnaoaoco N Q m ~ N ~ ~ ~ ~ > r ~ X 0 0 0 0 0 0 tt~ O O to to O 00 to O n tf) O n ~t O rt t!') ~t O ~ ~nn~OtDr tn~COoD~NMt!) 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N ~ ~ M M ~ ' J 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ~ Q O O O O O O O O O O O O O O O ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ O 0 0 0 0 0 0 0 0 ~ ~ ~ ~ ~ ~ ~ ~ O 0 d'V'~t~1"7~1'~~~~t'~~t~~d' ' ' V ~~~~~t~t'~td' t ~ ~t~ d ~ V'7d'~~~Y' ~d'V V V ~ V'ct'~~d'd' V'~Y ~ d"~i' d' ~i"~t ~ ~ ~ ~Y' ~Y V ~t V' V V' d ~ ~ V ~ ~t ~ d' ~ d d N N N N N N N N N N N N N N N C N N N N N N N N C N N N N N N N N N N N N N N N y N N N N N N N N y O O O O O O O O O O O O O O O 1 0 0 0 0 0 0 0 0 ~- ~ ~ ~ ~ i ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ M M M M M M M M M M M M M M M d O i ~ ~ ~ ~ i ~ i M M M M M M M M d O M M M M M M M M M M M M M M M L M M M M M M M M i O O U U N • SECTION Ill -TAX INCREMENT FINANCING PLAN FOR THE LYNDALE GATEWAY WEST TAX INCREMENT FINANCING DISTRICT Subsection 3-1. Foreword The Housing and Redevelopment Authority in and for the City of Richfield (the "HRA"), the City of Richfield (the "City"), staff and consultants have prepared the following information to expedite the establishment of the Lyndale Gateway West Tax Increment Financing District (the "District"}, a redevelopment tax increment financing district, located in the Richfield Redevelopment Project Area. Subsection 3-2. Statutory Authority Within the City, there exist areas where public involvement is necessary to cause development or redevelopment to occur. To this end, the HRA and City have certain statutory powers pursuant to Minnesota Statutes (the "M.S.'), Sections 469.001 to 469.047, inclusive, as amended, and M.S, Sections 469.174 to 469.1799, inclusive, as amended (the "Tax Increment Financing Act" or "TIF Act"), to assist in financing public costs related to this project. This section contains the Tax Increment Financing Plan (the "TIF Plan") for the Lyndale Gateway West Tax Increment Financing District. Other relevant information is contained in the Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area. Subsection 3-3. Statement of Objectives • The District currently consists of 21 parcels of land and adjacent and internal rights-of--way. The District is being created to facilitate the construction of a mixed-use housing and retail development project in the City of Richfield. Development is likely to occur in the Spring of 2003. This TIF Plan is expected to achieve many of the objectives outlined in the Redevelopment Plan for the Richfield Redevelopment Project Area. The activities contemplated in the Modification to the Redevelopment Plan and the TIF Plan do not preclude the undertaking of other qualified development or redevelopment activities. These activities are anticipated to occur over the life of the Richfield Redevelopment Project Area and the District. Subsection 3-4. Redevelopment Plan Overview 1. Property to be Acquired -Selected property located within the District maybe acquired by the HRA or City and is further described in this Plan. 2. Relocation -Relocation services, to the extent required by law, are available pursuant to M.S., Chapter 117 and other relevant state and federal laws. 3. Upon approval of a developer's plan relating to the project and completion of the necessary legal requirements, the HRA or City may sell to a developer selected properties that it may acquire within the District or may lease land or facilities to a developer. 4. The HRA or City may perform or provide for some or all necessary acquisition, construction, relocation, demolition, and required utilities, facilities, and other public • improvement needed within the District. Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-2 • • Subsection 3-5. Description of Property in the District and Property To Be Acquired The District encompasses all property and adjacent rights-of--way identified bythe parcels listed below. See the map in Appendix B for further information on the location of the District. 33-028-24-44-0036 33-028-24-44-0037 33-028-24-44-0038 33-028-24-44-0039 33-028-24-44-0040 33-028-24-44-0041 33-028-24-44-0042 33-028-24-44-0043 Parcel Numbers 33-028-24-44-0044 33-028-24-44-0045 33-028-24-44-0046 33-028-24-44-0056 33-028-24-44-0055 33-028-24-44-0054 33-028-24-44-0053 33-028-24-44-0052 33-028-24-44-0051 33-028-24-44-0050 33-028-24-44-0047 33-028-24-44-0048 33-028-24-44-0049 The HRA or City may acquire any parcel within the District including interior and adjacent street rights of way. Any properties identified for acquisition will be acquired by the HRA or City only in order to accomplish one or more of the following: storm sewer and/or storm water retention improvements; provide land for needed public streets, utilities and facilities; carry out land acquisition, site improvements, clearance and/or development to accomplish the uses and objectives set forth in this plan. The HRA or City may acquire property by gift, dedication, condemnation or direct purchase from willing sellers in order to achieve the objectives of this Plan. Such acquisitions will be undertaken only when there is assurance of funding to finance the acquisition and related costs. Subsection 3-6. Classification of the District The HRA and City, in determining the need to create a tax increment financing district in accordance with M.S., Sections 469.174 to 469.1799, as amended, inclusive, find that the District, to be established, is a redevelopment district pursuant to M.S., Section 469.174, Subd. 10(a)(1) as defined below: (a) "Redevelopmentdistrict"meansatypeoftaxincrementfinancingdistrictconsistingofaproject, or portions of a project, within which the authority finds by resolution that one or more of the following conditions, reasonably distributed throughout the district, exists: (1) parcels consisting of 70 percent of the area in the district are occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures and more than SO percent of the buildings, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance; or (2) The property consists of vacant, unused, underused, inappropriately used, or infrequently used rail yards, rail storage facilities or excessive or vacated railroad rights-of--way; or (3) tank facilities, or property whose immediately previous use was for tank facilities, as defined in Section 115C, Subd. 1 S, if the tank facility.- • (viii) have or had a capacity of more than one million gallons; (ix) are located adjacent to rail facilities,- or (x) have been removed, or are unused, underused, inappropriately used or infrequently used. Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-3 (b) For purposes of this subdivision, "structurally substandard" shall mean containing defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fireprotection includingadequate egress, layoutand condition ofinteriorpartitions, or similar factors, which defects or deficiencies are of sufficient total significance to just substantial renovation or clearance. (c) A building is not structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the building code at a cost of less than I S percent of the cost of constructing a new structure of the same square footage and type on the site. The municipality may find that a building is not disqualifred as structurally substandard under the preceding sentence on the basis of reasonably available evidence, such as the size, type, and age of the building, the average cost of plumbing, electrical, or structural repairs or other similar reliable evidence. The municipality may not make such a determination without an interior inspection of the property, but need not have an independent, expert appraisal prepared of the cost of repair and rehabilitation of the building. An interior inspection of the property is notrequired, ifthe municipalityfinds that (1) the municipality or authority is unable to gain access to the property after using its best efforts to obtain permission from the party that owns or controls the property,- and (2) the evidence otherwise supports a reasonable conclusion that the building is structurally substandard. (d) A parcel is deemed to be occupied by a structurally substandard building for purposes of the finding under paragraph (a) if all of the following conditions are met: (1) the parcel was occupied by a substandard building within three years of the filing of the request for certification of the parcel as part of the district with the county auditor; (2) the substandard building was demolished or removed by the authority or the demolition or removal was financed by the authority or was done by a developer under a development agreement with the authority; (3) the authority found by resolution before the demolition or removal that the parcel was occupied by a structurally substandard building and that after demolition and clearance the authority intended to include the parcel within a district; and (4) upon filing the request for certification of the tax capacity of the parcel as part of a district, the authority notifies the county auditor that the original tax capacity of the parcel must be adjusted as provided by ~ 469.177, subdivision 1, paragraph (h). (e) For purposes of this subdivision, a parcel is not occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures unless IS percent of the area of the parcel contains buildings, streets, utilities, paved or gravel parking lots or other similar structures. (~ For districts consisting of two or more noncontiguous areas, each area must qualify as a redevelopment district under paragraph (a) to be included fn the district, and the entire area of the district must satisfy paragraph (a). In meeting the statutory criteria the HRA and City rely on the following facts and findings: ^ The District is a redevelopment district consisting of 21 parcels. Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-4 o An inventory shows that parcels consisting of 70 percent of the area in the District are occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures. This documentation is detailed in the Redevelopment EligibilityAssessment, datedNovember2002, prepared by SEH, which is on file at the Richfield City Hall. o An inspection ofthe buildings located within the District finds that more than 50 percent of the buildings are structurally substandard as defined in the TIF Act. (See Appendix E). This documentation is detailed in the Redevelopment Eligibility Assessment, prepared by SEH, which is on file at the Richfield City Hall. Pursuant to M.S.469.176 Subd. 7, the District does not contain any parcel or part of a parcel that qualified under the provisions of M.S 273.111 or 273.112 or Chapter 473H for taxes payable in any of the five calendar years before the filing of the request for certification of the District. Subsection 3-7. Duration of the District Pursuant to MS., Section 469.175, Subd. 1, and Section 469.176, Subd. 1, the duration of the District must be indicated within the Plan. Pursuant to M.S., Section 469.176, Subd. 1 b, the duration of the District will be 25 years after receipt of the first increment by the HRA or City (a total of 26 years). The date of receipt by the City of the first tax increment is expected to be 2005. Thus, it is estimated that the District, including any modifications of the Plan for subsequent phases or other changes, would terminate after 2030, or when the Plan is satisfied. If increment is received in 2004, the term ofthe District will be 2029. The HRA or City reserves the right to decertify the District prior to the legally required date. Subsection 3-8. Original Tax Capacity, Tax Rate and Estimated Captured Net Tax Capacity • Value/Increment and Notification of Prior Planned Improvements Pursuant to M.S., Section 469.174, Subd. 7 and M.S., Section 469.177, Subd. 1, the Original Net Tax Capacity (ONTC) as certified for the District will be based on the market values placed on the property by the assessor in 2002 for taxes payable 2003. Pursuant to M.S., Section 469.177, Subds. 1 and 2, the County Auditor shall certify in each year (beginning in the payment year 2003) the amount by which the original value has increased or decreased as a result of 1. Change in tax exempt status of property; 2. Reduction or enlargement of the geographic boundaries of the district; 3. Change due to adjustments, negotiated or court-ordered abatements; 4. Change in the use of the property and classification; 5. Change in state law governing class rates; or 6. Change in previously issued building permits. In any year in which the current Net Tax Capacity (NTC) value of the District declines below the ONTC, no value will be captured and no tax increment will be payable to the HRA or City. The original local tax rate for the District will be the local tax rate for taxes payable 2003, assuming the request for certification is made before June 30, 2003. The ONTC and the Original Local Tax Rate for the District appear in the table on the next page. Pursuant to M.S., Section 469.174 Subd. 4 and M.S., Section 469.177, Subd. 1, 2, and 4, the estimated . Captured Net Tax Capacity (CTC) of the District, within the Richfield Redevelopment Project Area, upon completion of the proj ect, will annually approximate tax increment revenues as shown in the table on the next Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-5 • page. The I-1RA and City request 100 percent of the available increase in tax capacity for repayment of its obligations and current expenditures, beginning in the tax year payable 2005. The Project Tax Capacity (PTC) listed is an estimate of values when the project is completed. Project Estimated Tax Capacity upon Completion (PTC) 259,533 Original Estimated Net Tax Capacity(ONTC) 35,586 Estimated Captured Tax Capacity (CTC) 223,947 Original Local Tax Rate 1.33543 Esoln Pa 2002 Y Estimated Annual Tax Increment(CTC x Local Tax Rate) 299,066 Percent Retained by the HRA 100% Pursuant to M.S., Section 469.177, Subd. 4, the HRA shall, after a due and diligent search, accompany its request for certification to the County Auditor or its notice of the District enlargement pursuant to M.S., Section 469.175, Subd. 4, with a listing of all properties within the District or area of enlargement for which building permits have been issued during the eighteen (18) months immediately preceding approval of the Plan by the municipality pursuant to M.S., Section 469.175, Subd. 3. The County Auditor shall increase the original net tax capacity of the District by the net tax capacity of improvements for which a building permit was issued. The City has reviewed the area to be included in the District and found that some building permits have been issued in the past 18 months, but none that should increase the original tax capacity. Please see Appendix G for the building permits that were issued. Subsection 3-9. Sources of Revenue/Bonded Indebtedness Public improvement costs, acquisition, relocation, utilities, parking facilities, streets and sidewalks, and site preparation costs and other costs outlined in the Uses of Funds will be financed primarily through the annua} collection of tax increments. The HRA or City reserves the right to use other sources of revenue legally ap- plicable to the HRA or City and the T1F Plan, including, but not limited to, special assessments, general property taxes, state aid for road maintenance and construction, proceeds from the sale of land, other contributions from the developer and investment income, to pay for the estimated public costs. The HI2A or City reserves the right to incur bonded indebtedness or other indebtedness as a result of the TIF Plan. As presently proposed, the project will be financed by apay-as-you-go note or a G.O. TIF bond issue. Additional indebtedness maybe required to finance other authorized activities. The total principal amount of bonded indebtedness or other indebtedness related to the use of tax increment financing will not exceed $6,000,000 without a modification to the TIF Plan pursuant to applicable statutory requirements. This provision does not obligate the HRA or City to incur debt. The I-1RA or City will issue bonds or incur other debt only upon the determination that such action is in the best interest of the City. The HRA or City may also finance the activities to be undertaken pursuant to the T1F Plan through loans from funds of the HRA or City or to reimburse the developer on a "pay-as-you-go" basis for eligible costs paid for by a . developer. The estimated sources of funds for the District are contained in the table on the next page. Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-6 SOURCES OF FUNDS TOTAL Tax Increment $7,476,636 PROJECT REVENUES $7,476,636 Subsection 3-10. Uses of Funds Currently under consideration for the District is a proposal to facilitate the construction of a mixed-use housing and retail development. The HRA and City have determined that it will be necessary to provide assistance to the project for certain costs. The HRA has studied the feasibility of the development or redevelopment of property in and around the District. To facilitate the establishment and development or redevelopment of the District, this TIF Plan authorizes the use of tax increment financing to pay for the cost of certain eligible expenses. The estimate of public costs and uses of funds associated with the District is outlined in the following table. USES OF FUNDS TOTAL • LandBuilding Acquisition Interest Administrative Costs (up to 10%) $717,757 • PROJECT COSTS TOTAL $3,300,000 $3,458,879 $7,476,636 The above budget is organized according to the Office of State Auditor (OSA) reporting forms. Estimated costs associated with the District are subject to change among categories without a modification to this Plan. The cost of all activities to be considered for tax increment financing will not exceed, without formal modification, the budget above pursuant to the applicable statutory requirements. Pursuant to M.S., Section 469.1763, Subd 2, no more than 25 percent of the tax increment paid by property within the District will be spent on activities related to development or redevelopment outside of the District but within the boundaries of the Richfield Redevelopment Project Area, (including administrative costs, which are considered to be spent outside of the District) subject to the limitations as described in this Plan. Subsection 3-11. State Tax Increment Financing Aid (Local Contribution) M.S., Section 273.1399 (I,GA/HACA penalty) was repealed by the 2001 Legislature and does not apply to the District. Subsection 3-12. Fiscal Disparities Election Pursuant to M.S., Section 469.177, Subd. 3, the HRA or City may elect one of two methods to calculate fiscal disparities. If the calculations pursuant to M.S., Section 469.177, Subd. 3, clause b, (within the District) are followed, the following method of computation shall apply: (1} The original net tax capacity shall be determined before the application of the fiscal disparity provisions of Chapter 276A or 473F. The current net tax capacity shall exclude any fiscal disparity commercial-industrial net tax capacity increase between the original year and the Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-7 • current year multiplied by the fiscal disparity ratio determined pursuant to M.S., Section 276A.06, subdivision 7 or M.S., Section 473F.08, subdivision 6. Where the original net tax capacity is equal to or greater than the current net tax capacity, there is no captured tax capacity and no tax increment determination. Where the original tax capacity is less than the current tax capacity, the d~erence between the original net tax capacity and the current net tax capacity is the captured net tax capacity. This amount less any portion thereof which the authority has designated, in its tax increment financing plan, to share with the local taxing districts is the retained captured net tax capacity of the authority. (2) The county auditor shall exclude the retained captured net tax capacity of the authority from the net tax capacity of the local taxing districts in determining local taxing district tax rates. The local tax rates so determined are to be extended against the retained captured net tax capacity of the authority as well as the net tax capacity of the local taxing districts. The tax generated by the extension of the less of (A) the local taxing district tax rates or (B) the original local tax rate to the retained captured net tax capacity of the authority is the tax increment of the authority. The HRA or City shall submit to the County Auditor at the time of the request for certification which method of computation of fiscal disparities the HRA or City elected. The HRA will choose to calculate fiscal disparities by clause b. According to M.S., Section 469.177, Subd. 3: • (c) The method of computation of tax increment applied to a district pursuant to paragraph (a) or (b) shall remain the same for the duration of the district, except that the governing body may elect to change its election from the method of computation in paragraph (a) to the method in P~'agr'aPh (b)• Subsection 3-13. Business Subsidies To the extent applicable, the HRA or City agrees to comply with M.S., Section 116J.993 to 116J.994, which states that a local unit of government granting financial assistance to a business for economic development or job growth purposes, including tax increment financing, must establish business subsidy criteria and approve a business subsidy agreement with the business receiving the assistance. Subsection 3-14. County Road Costs Pursuant to M.S., Section 469.175, Subd. la, the county board may require the HRA or City to pay for all or part of the cost of county road improvements if the proposed development to be assisted by tax increment will, in the judgement of the county, substantially increase the use of county roads requiring construction of road improvements or other road costs and if the road improvements are not scheduled within the next five years under a capital improvement plan or within five years under another county plan.. If the county elects to use increments to improve county roads, it must notify the HRA or City within forty-five days of receipt of this Plan. Subsection 3-15. Estimated Impact on Other Taxing Jurisdictions The estimated impact on other taxing jurisdictions assumes that the redevelopment contemplated by the TIF Plan would occur without the creation of the District. However, the HRA or City has determined that such Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-8 • development or redevelopment would not occur "but for" tax increment financing and that, therefore, the fiscal impact on other taxing jurisdictions is $0. The estimated fiscal impact of the District would be as follows if the "but for" test was not met: IlVIPACT ON TAX BASE 2001/2002 Estimated Captured Total Net Tax Capacity (CTC) Percent of CTC Tax Capacity Unon Completion to Enti _ Total Hennepin County 836,803,010 223,947 0.0268% City of Richfield 17,175,522 223,947 1.3039% Richfield ISD No. 280 21,713,385 223,947 1.0314% IMPACT ON TAX RATES 2001/2002 Percent Potential Extension Rates of Total CTC Taxes Hennepin County ~ 0.504090 37.75% 223,947 112,889 City of Richfield 0.517224 38.73% 223,947 115,830 Richfield ISD No. 280 0.226780 16.98% 223,947 50,787 • Other 0.087340 6.54% 223.947 19.560 Total 1.335430 100.00% 299,066 The estimates listed above display the captured tax capacity when all construction is completed. The tax rate used for calculations isthe actua12001/Pay 2002 rate. The total net capacity for the entities listed above are based on actual Pay 2002 figures. The District will be certified under the actual 2002/Pay 2003 rates, which were unavailable at the, time this TIF Plan was prepared. Subsection 3-16. Supporting Documentation Pursuant to M.S. Section 469.175 Subd 1 a, clause 7 the TIF Plan must contain identification and description of studies and analyses used to make the determination set forth in M.S. Section 469.175 Subd 3, clause (2)and the findings are required in the resolution approving the TIF district. Following is a list of reports and studies on file at the City that support the Authority's findings: Developer's Request for Tax Increment Financing Assistance • Report on Blight Assessment. November, 2002. SEH • Redevelopment Eligibility Assessment. November, 2002. SEH • Market Feasibility Study for Lyndale Gateway, Summary Results. October 2002. GVA Marquette Advisors for The Cornerstone Group. • But-For Financial Analysis (attached in Appendix F). November 2003. Ehlers & Associates, Inc. Additional studies and reports prepared in connection with the efforts to develop this and adj acent areas since 1985 can be found at the Community Development Office in City Hall. • Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-9 Subsection 3-17. Definition of Tax Increment Revenues Pursuant to M.S., Section 469.174, Subd. 25, tax increment revenues derived from a tax increment financing district include all of the following potential revenue sources: 1. Taxes paid by the captured net tax capacity, but excluding any excess taxes, as computed under M. S., Section 469.177; 2. The proceeds from the sale or lease of property, tangible or intangible, purchased by the Authority with tax increments; 3. Repayments of loans or other advances made by the Authority with tax increments; and 4. Interest or other investment earnings on or from tax increments. Subsection 3-18. Modifications to the District In accordance with M.S., Section 469.175, Subd. 4, any: 1. Reduction or enlargement of the geographic area of the Richfield Redevelopment Project Area or the District; 2. Increase in amount of bonded indebtedness to be incurred, including a determination to capitalize interest on debt if that determination was not a part of the original plan, or to increase or decrease the amount of interest on the debt to be capitalized; 3. Increase in the portion of the captured net tax capacity to be retained by the HRA or City; 4. Increase in total estimated tax increment expenditures; or 5. Designation of additional properly to be acquired by the HRA or City, shall be approved upon the notice and after the discussion, public hearing and findings required for approval of the original Plan. Pursuant to M.S. Section 469.175 Subd. 4(b), the geographic area of the District may be reduced, but shall not be enlarged after five years following the date of certification of the original net tax capacity by the county auditor. If a redevelopment district is enlarged, the reasons and supporting facts for the determination that the addition to the district meets the criteria ofM.S., Section 469.174, Subd. 10, paragraph (a), clauses (1) to (5), must be documented in writing and retained. 'The requirements of this paragraph do not apply if (1) the only modification is elimination of parcel(s) from the Richfield Redevelopment Project Area or the District and (2) (A) the current net tax capacity ofthe parcel(s) eliminated from the District equals or exceeds the net tax capacity of those parcel(s) in the District's original net tax capacity or (B) the HRA agrees that, notwithstanding M.S., Section 469.177, Subd.1, the original net tax capacity will be reduced by no more than the current net tax capacity of the parcel(s) eliminated from the District. The HRA or City must notify the County Auditor of any modification that reduces or enlarges the geographic area of the Richfield Redevelopment Project Area or the District. Modifications to the District in the form of a budget modification or an expansion of the boundaries will be recorded in the TlF Plan. Subsection 3-19. Administrative Expenses In accordance with M.S., Section 469.174, Subd. 14, and M.S., Section 469.176, Subd. 3, administrative expenses means all expenditures of the HRA or City, other than: 1. Amounts paid for the purchase of land; 2. Amounts paid to contractors or others providing materials and services, including architectural and Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-10 engineering services, directly connected with the physical development of the real property in the project; 3. Relocation benefits paid to or services provided for persons residing or businesses located in the project; or 4. Amounts used to pay principal or interest on, fund a reserve for, or sell at a discount bonds issued pursuant to M.S., Section 469.178; or 5. Amounts used to pay other financial obligations to the extent those obligations were used to finance costs described in sections 1 to 3. For districts for which the request for certification were made before August 1, 1979, or after June 30,1982, administrative expenses also include amounts paid for services provided by bond counsel, fiscal consultants, and planning or economic development consultants. Tax increment may be used to pay any authorized and documented administrative expenses for the District up to but not to exceed 10 percent of the total tax increment expenditures authorized by the Plan or the total tax increment expenditures for the Richfield Redevelopment Project Area, whichever is less. Pursuant to M.S., Section 469.176, Subd. 4h, tax increments may be used to pay for the county's actual administrative expenses incurred in connection with the District. The county may require payment of those expenses by February 15 of the year following the year the expenses were incurred. Pursuant to tLf.S., Section 469. 177, Subd. 11, the County Treasurer shall deduct an amount (currently :36 percent) of any increment distributed to the HRA or City and the County Treasurer shall pay-the amount deducted to the State Treasurer for deposit in the state general fund to be appropriated to the State Auditor for the cost of financial reporting of tax increment financing information and the cost of examining and auditing authorities' use of tax increment financing. This amount may be adjusted annually by the Commissioner of Revenue. Subsection 3-20. Limitation of Increment Pursuant to M.S., Section 469.176, Subd. la, no tax increment shall be paid to the HIZA or City for the District after three (3) years from the date of certification of the Original Net Tax Capacity value of the taxable property in the District by the County Auditor unless within the three (3) year period: (1) Bonds have been issued in aid of the project containing the District pursuant to M.S., Section 469.178, or any other law, except revenue bonds issued pursuant to M.S., Sections 469.152 to 469.165, or (2) The HRA or City has acquired property within the District, or (3) The HRA or City has constructed or caused to be constructed public improvements within the District. The bonds must be issued, or the HRA or City must acquire property or construct or cause public improvements to be constructed by approximately December, 2005 and report such actions to the County Auditor. The tax increment pledged to the payment of bonds and interest thereon maybe discharged and the District may be terminated if sufficient funds have been irrevocably deposited in the debt service fund or other escrow account held in trust for all outstanding bonds to provide for the payment of the bonds at maturity or redemption date. Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-11 Pursuant to M.S., Section 469.176, Subd. 6: if, after four years from the date of certification of the original net tax capacity of the tax increment financing district pursuant to M.S., Section 469.177, no demolition, rehabilitation or renovation of property or other site preparation, including qualified improvement of a street adjacent to a parcel but not installation of utility service including sewer or water systems, has been commenced on a parcel located within a tax increment financing district by the authority or by the owner of the parcel in accordance with the tax increment frnancing plan, no additional tax increment may be taken from that parcel and the original net tax capacity of that parcel shall be excluded from the original net tax capacity of the tax increment frnancing district. If the authority or the owner of the parcel subsequently commences demolition, rehabilitation or renovation or other site preparation on that parcel including qualified improvement of a street adjacent to that parcel, in accordance with the tax increment fnancing plan, the authority shall certify to the county -auditor that the activity has commenced and the county auditor shall cert~ the net tax capacity thereof as most recently certified by the commissioner of revenue and add it to the original net tax capacity of the tax increment financing district. The county auditor must enforce the provisions of this subdivision. The authority must submit to the county auditor evidence that the required activity has taken place for each parcel in the district. The evidence for a parcel must be submitted by February 1 of the fofth year following the year in which the parcel was certified as included in the district. For purposes of this subdivision, qualified improvements of a street are limited to (1) construction or opening of anew street, (2) relocation of a street, and (3) substantial reconstruction or rebuilding of an existing street. The HRA or City or a property owner must improve parcels within the District by approximately December, • 2006 and report such actions to the County Auditor. Subsection 3-21. Use of Tax Increment The HRA or City hereby determines that it will use 100 percent of the captured net tax capacity of taxable property located in the District for the following purposes: 1. To pay the principal of and interest on bonds issued to finance a project; 2. to finance, or otherwise pay public redevelopment costs of the Richfield Redevelopment Project Area pursuant to the M.S., Sections 469.001 to 469.047; 3. To pay for project costs as identified in the budget set forth in the Plan; 4. To finance, or otherwise pay for other purposes as provided in M.S., Section 469.176, Subd. 4; 5. To pay principal and interest on any loans, advances or other payments made to or on behalf of the HRA or City or for the benefit of the Richfield Redevelopment Project Area by a developer; 6. To finance or otherwise pay premiums and other costs for insurance or other security guaranteeing the payment when due of principal of and interest on bonds pursuant to the Plan or pursuant to M.S., Chapter 462C. M.S., Sections 469.152 through 469.165, and/or M.S., Sections 469.178; and ?. To accumulate or maintain a reserve securing the payment when due of the principal and interest on the tax increment bonds or bonds issued pursuant to M.S., Chapter 462C, M.S., Sections 469.152 through 469.165, and/or M.S., Sections 469.178. These revenues shall not be used to circumvent any levy limitations applicable to the City nor for other purposes prohibited by M.S., Section 469.176, Subd. 4. • Tax increments generated in the District will be paid by Hennepin County to the HRA for the Tax Increment Fund of said District. The HRA or, City will pay to the developer(s) annually an amount not to exceed an Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-12 • amount as specified in a developer's agreement to reimburse the costs of land acquisition, public improvements, demolition and relocation, site preparation, and administration. Remaining increment funds will be used for HHRA or City administration (up to 10 percent) and the costs of public improvement activities outside the District. Subsection 3-22. Excess Tax Increments Pursuant to M.S., Section 469.176, Subd. 2, in any year in which the tax increment exceeds the amount necessary to pay the costs authorized by the Plan, including the amount necessary to cancel any tax levy as provided in M.S., Section 475.61, Subd. 3, the HRA or City shall use the excess amount to do any of the following: 1. Prepay any outstanding bonds; 2. Discharge the pledge of tax increment therefor; 3. Pay into an escrow account dedicated to the payment of such bonds; or 4. Return the excess to the County Auditor for redistribution to the respective taxing jurisdictions in proportion to their local tax rates. In addition, the HRA or City may, subject to the limitations set forth herein, choose to modify the TIF Plan in order to finance additional public costs in the Richfield Redevelopment Project Area or the District. Subsection 3-23. Requirements for Agreements with the Developer The HRA or City will review any proposal for private development to determine its conformance with the • Redevelopment Plan and with applicable municipal ordinances and codes. To facilitate this effort, the following documents may be requested for review and approval: site plan, construction, mechanical, and electrical system drawings, landscaping plan, grading and storm drainage plan, signage system plan, and any other drawings or narrative deemed necessary by the HRA or City to demonstrate the conformance of the development with City plans and ordinances. The HRA or City may also use the Agreements to address other issues related to the development. Pursuant to M.S., Section 469.176, Subd. S, no more than 25 percent, by acreage, of the property to be acquired in the District as set forth in the Plan shall at any time be owned by the HRA or City as a result of acquisition with the proceeds of bonds issued pursuant to M. S., Section 469.178 to which tax increments from property acquired is pledged, unless prior to acquisition in excess of 25 percent of the acreage, the HRA or City concluded an agreement for the development or redevelopment of the property acquired and which provides recourse for the HRA or City should the development or redevelopment not be completed. Subsection 3-24. Assessment Agreements Pursuant to M.S., Section 469.177, Subd. 8, the HRA or City may enter into a written assessment agreement in recordable form with the developer of property within the District which establishes a minimum market value of the land and completed improvements for the duration of the District. The assessment agreement shall be presented to the County Assessor who shall review the plans and specifications for the improvements to be constructed, review the market value previously assigned to the land upon which the improvements are to be constructed and, so long as the minimum market value contained in the assessment agreement appears, in the judgment of the assessor, to be a reasonable estimate, the County Assessor shall also certify the • minimum market value agreement. Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-13 • Subsection 3-25. Administration of the District Administration of the District will be handled by the Community Development Director for the City of Richfield. Subsection 3-26. Annual Disclosure Requirements Pursuant to M. S., Section 469.175, Subd. S, 6 and 6a the HRA or City must undertake financial reporting for all tax increment financing districts to the Office of the State Auditor, County Board, County Auditor and School Board on or before August I of each year. M.S., Section 469.175, Subd. S also provides that an annual statement shall be published in a newspaper of general circulation in the City on or before August 15. If the City fails to make a disclosure or submit a report containing the information required byM.S. Section 469.175 Subd. 5 and Subd. 6, the OSA will direct the County Auditor to withhold the distribution of tax increment from the District. Subsection 3-27. Reasonable Expectations As required by the TIF Act, in establishing the District, the determination has been made that the anticipated development would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment fmancing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the District permitted by the Plan. In making said determination, reliance has been placed upon written representation made by the developer to such effects and upon HRA and City staff awareness of the feasibility of developing the prof ect site. A comparative analysis of estimated market values both with and without establishment of the District and the use of tax increments has been performed as described above. Such analysis is included with the cashflow in Appendix D and Appendix F, and indicates that the increase in estimated market value of the proposed development (less the indicated subtractions) exceeds the estimated market value of the site absent the establishment of the District and the use of tax increments. Subsection 3-28.Other Limitations on the Use of Tax Increment General Limitations. All revenue derived from tax increment shall be used in accordance with the Plan. The revenues shall be used to finance, or otherwise pay public redevelopment costs of the Richfield .Redevelopment Project Area pursuant to the M.S., Sections 469.001 to 469.047. Tax increments may not be used to circumvent existing levy limit law. No tax increment may be used for the acquisition, construction, renovation, operation, or maintenance of a building to be used primarily and regularly for conducting the business of a municipality, county, school district, or any other local unit of government or the state or federal government. This provision does not prohibit the use of revenues derived from tax increments for the construction or renovation of a parking structure. 2. Pooling Limitations. At least 75 percent of tax increments from the District must be expended on activities in the District or to pay bonds, to the extent that the proceeds of the bonds were used to finance activities within said district or to pay, or secure payment of, debt service on credit enhanced bonds. Not more than 25 percent of said tax increments may be expended, through a development fund or otherwise, • on activities outside of the District except to pay, or secure payment of, debt service on credit enhanced bonds. For purposes of applying this restriction, all administrative expenses must be treated as if they were solely for activities outside of the District. Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-14 • 3. Five Year Limitation on Commitment of Tax Increments. Tax increments derived from the District shall be deemed to have satisfied the 75 percent test set forth in paragraph (2) above only if the five year rule set forth in M.S., Section 469.1763, Subd. 3, has been satisfied; and beginning with the sixth year following certification of the District, 75 percent of said tax increments that remain after expenditures permitted under said five year rule must be used only to pay previously committed expenditures or credit enhanced bonds as more fully set forth in M.S., Section 469.1763, Subd. 5. 4. Redevelopment District. At least 90 percent of the revenues derived from tax increment from a redevelopment district must be used to finance the cost of correcting conditions that allow designation ofredevelopmentand renewal and renovation districts underM.S., Section 469.176Subd. 4j. These costs .include, but are not limited to, acquiring properties containing structurally substandard buildings or improvements or hazardous substances, pollution, or contaminants, acquiring adjacent parcels necessary to provide a site of sufficient size to permit development, demolition and rehabilitation of structures, clearing of the land, the removal of hazardous substances or remediation necessary for development of the land, and installation of utilities, roads, sidewalks, and parking facilities for the site. The allocated administrative expenses of the HRA or City, including the cost of preparation of the development action response plan, maybe included in the qualifying costs. Subsection 3-29. Summary The HRA is establishing the District to preserve and enhance the tax base, redevelop substandard areas, provide housing opportunities and new neighborhood commercial and retail space, and provide employment opportunities in the City. The TIF Plan for the District was prepared by Ehlers & Associates, Inc., 3060 Centre Pointe Drive, Roseville, Minnesota 55113, telephone (651) 697-8500. • • Richfield Housing and Redevelopment Authority Tax Increment Financing Plan for the Lyndale Gateway West TIF District 3-15 • APPENDIX A PROJECT DESCRIPTION The Lyndale Gateway West Tax Increment Financing District is being facilitated to create an integrated mixed-use development of housing, commercial, parking and new public facilities, utilities, streetscape, and other improvements. The project components include the following:. • 92 to 941oft-style condominium units in 2 four story buildings with 115 underground parking spaces and additional surface parking of approximately 10 stalls • 14 two-story townhomes in three separate buildings with two-car, attached garages • 27,000-33,000 square feet of retail and office space in three buildings with approximately 126 parking stalls located behind the buildings • Reconstructed Lyndale Avenue with landscaped median, boulevard plantings, decorative sidewalk, street furniture, pedestrian-scale lighting, and entry monuments • APPENDIX A-1 n U • • APPENDIX APPENDIX B MAP OF THE RICHFIELD REDEVELOPMENT PROJECT AREA AND THE LYNDALE GATEWAY WEST TIF DISTRICT B-1 LYON WB at ~"` ,~. V -a~lawool+ w/ asi Ii a~i a>Ei a¢1 Q wu Q W ~~ V Z alDl Tana oovolla w/ Ii Q ~~ ~ . ~ V ~ ~ ~ ~~~ snewnwa ~ XaVd ~ ONYiHMO ~. ONVilaOd t11 t L W. O a ' ~ ~ W ~ ~ ,~ Nolrrlo . °~ s~~ ^ ~ At Z ~ 131,oJiN llaasnne U H1aOMtN3M Z O Z ~ AanBSnid lNVSV37d Q ~ oNVao W W 0 ~"" ~ (n W lalaavH alal~avv~ 37KONAl N~laaly 1NVAae W xvalo~ lrpano Q } Q NOSaaw3~ 1NOwaud W oavaro ~. - U . W . .~ ~ loloewnN Banat ~ ~ S3!CYf XbNfl ~ {~j~ W NVOOI PH9aON NO1M3N aQ aanno 0 NNad Z -aanD >„ nassna J NvolaaNs 511110H1. No1dn 1N3JMA Nan9HSYM S3Xa3X - Qzl 0 N O !!J 4181 W a¢- W agt' Q No~Ntwools .. asst a»t axt v¢t aft ...: a~- ti '~ ~_ 101113 ~ . 4l O'J11~IND SnaR1Yp0 ~ ~ ~ ~ C JIMYd ~ ~ 'a •C ONVi.YYO O , ~ ONVLLaOd C C . 4B m ~ vn ~ C NOINTJ Q wt U m we C3 v SN3A31.r •0 ~ Q. X #~ 13noaN C ~ ~ •r naasmv . E m HLaOMUHM Q >. AaR8ST11d ~ -l 1MlSYald m 3 ONYaO ~ m lalaavN ~ ~ a1dUNAl ~ C? s~aaaly t ~ 1NrAae V ~ Q' J xadloo 1NOano NOSaaw3 1Na13aj oara~ tmoewnN . ~-anal S?wK XOD01 NV'JOl NVJM011 NO1M3N aanrto .. NNad ~ o. N33nD ~- - "lL n~sna o ~ 0 Nvwa3tts c°v T SVNONL ~ Nolan oo g 1NaOHA O ~ o NanBFriYM p Sa7(N3X ~ r~3. $ r~ p a e tl ~ ~ Fe ~ ~ S {~~ A ~ ~ n ~ d ~ ^ ~ ~ p 5 O 0 V 0 ~ - " 0 Y r Z APPENDIX C DESCRIPTION OF PROPERTY TO BE INCLUDED IN THE DISTRICT The District encompasses all property and adjacent rights-of--way identified by the parcels listed below. • Parcel Numbers Address Owner 33-028-24-44-0036 7600 LYNDALE AVENUE SOUTH TOP VALUE AUTO SUPPLY INC 33-028-24-44-0037 7608-12 LYNDALE AVENUE SOUTH RAYMOND F SAWITZKE 33-028-24-44-0038 7614-18 LYNDALE AVENUE SOUTH PATRICK L O'BRIEN 33-028-24-44-0039 7620-26 LYNDALE AVENUE SOUTH ELLIOT I WOLSON ETAL 33-028-24-44-0040 7632 LYNDALE AVENUE SOUTH SEASONAL CONTROL INC 33-028-24-44-0041 7628 LYNDALE AVENUE SOUTH ACTION EMPLOYMENT INC 33-028-24-44-0042 7630 LYNDALE AVENUE SOUTH D N ERICKSON ET AL TRUSTEES 33-028-24-44-0043 7634-36 LYNDALE AVENUE SOUTH ROBERT EHRMAN & WIFE 33-028-24-44-0044 7638-40 LYNDALE AVENUE SOUTH ROBERT EHRMAN & WIFE 33-028-24-44-0045 7642 LYNDALE AVENUE SOUTH GEORGE A ROONEY ETAL 33-028-24-44-0046 7644 LYNDALE AVENUE SOUTH ROBERT R LURTSEMA 33-028-24-44-0056 7601 ALDRICH AVENUE SOUTH J C ULRICH ETAL 33-028-24-44-0055 7609 ALDRICH AVENUE SOUTH BOUNVIEN VONGSOUVAN ET AL 33-028-24-44-0054 7615 ALDRICH AVENUE SOUTH M & D NORLING 33-028-24-44-0053 7621 ALDRICH AVENUE SOUTH CONSTANCE M JOHNSON 33-028-24-44-0052 7627 ALDRICH AVENUE SOUTH KENNETH S WREN 33-028-24-44-0051 7633 ALDRICH AVENUE SOUTH ALAN P KRAEMER 33-028-24-44-0050 7639 ALDRICH AVENUE SOUTH KRISTEN A LAMONT 33-028-24-44-0047 7648 LYNDALE AVENUE SOUTH CITY OF RICHFIELD 33-028-24-44-0048 7646 LYNDALE AVENUE SOUTH CITY OF RICHFIELD 33-028-24-44-0049 7645 ALDRICH AVENUE SOUTH CITY OF RICHFIELD APPENDIX C-l APPENDIX D ESTIMATED CASH FLOW FOR THE DISTRICT • ~J APPENDIX D-i N O m a • r~ ~~ N O O N O O O O O O N N N N N N a aaaaa e off' O M ~ O M0 C p ` 7 O(D O I O f~ 0 0 M 0 O R O O o ~O NN R O MOO m R~ V t1 \ I i I O N ~'- 00 2 O ~y o ~ a m j v ~ C m m x V c m ~ C x o ~ m C7 :°. c i ~ ~z m m ! 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Both reports are available for review at the Community Development Department in the Richfield City Hall. C. • APPENDIX E-I • APPENDIX F BUT/FOR QUALIFICATIONS But For Anal sis Current Market Value -Estimate New Market Value -Estimate $2,531,600 23,960,004 Difference Present Value of Tax Increment $21,428,404 2,434,271 Difference $18, 994,133 Value Likely to Occur Without TIF is Less Than: $18,994,133 The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for the Lyndale Gateway West Tax Increment Financing District, as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: 1. Finding that Lyndale Gateway West Tax Increment Financing District is a redevelopment district as defined in M.S., Section 469.174, Subd. 10(a)(1). The District consists of 2lparcels and adjacent and internal rights of way, with plans to redevelop the area for mixed-use housing and retail purposes. Parcels that make up at least 70 percent of the area in the District are occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures, and more than 50 percent of the buildings in the District, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance (See Appendix E of the TIF plan, and Exhibit B to this Resolution). 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that couldreasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the Lyndale Gateway West Tax Increment Financing District permitted by the Plan. The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future: The area to be included in the district has not been significantly upgraded or renovated for many years. The only significant new construction activity in the vicinity of the District within the past quarter century was accomplished only because public assistance was made available. The proposed development, which includes retail, commercial and housing calls for the acquisition of all of the land in the District, the demolition of all improvements, and the comprehensive redevelopment of the entire area. Site assembly costs, including the need to purchase buildings and other improvements only to demolish them before redevelopment • can take place, would understandably seem to prevent the proposed development to take place through private investment. Because the parcels within the proposed district are in multiple ownerships, it is APPENDIX F-1 • unlikely that assembly could take place without the ability to compel sale, unless a premium were paid for the land. The developer is also being asked to provide an affordable housing component to the development. Absent public assistance, private investors would likely not elect to participate in such a program. These conclusions are reinforced by the analysis prepared by Ehlers & Associates, Inc. as justification that the developer would not have gone forward without tax increment assistance (see Appendix F). The increased market value of the site that couldreasonably be expected to occur without the use of tax increment fnancing would be less than the increase in market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum. duration of the TIF District permitted by the Plan: On the basis of what has been stated above, the City finds it unlikely that any new development impacting market values will take place in the district. The only significant potential for new development in the area would be on the two completely vacant parcels, in any event, it is the Council's finding that no development or combination of developments with a market value of greater than $23,960,004 (based on Appendix D to the TIF Plan) would occur without tax increment assistance in this district within 25 years. 3. Finding that the Tax Increment Financing Plan for Lyndale Gateway West Tax Increment Financing District conforms to the general plan for the development or redevelopment of the municipality as a whole. The Planning Commission reviewed the Plan and found that the Plan conforms to the general development plan of the City. • 4. Finding that the Tax Increment Financing Plan for the Lyndale Gateway West Tax Increment Financing District will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development or redevelopment of Richfield Redevelopment Project Area by private enterprise. No significant redevelopment has occurred within the area of the district for many years. Consequently, it is the determination of the City that absent the assistance authorized by the Plan, no development or redevelopment of the area by private enterprise can be reasonably anticipated. The Council, also finds that the implementation ofthe Plan through the construction of the proposed development will increase the availability of safe and decent life-cycle housing in the City, will increase the tax base, will add a high quality mixed-use development to the City, will eliminate or prevent the spread of blight, and will remove and replace substandard structures and other conditions in furtherance of the objectives for which the District is being created APPENDIX F-2 L~ West Lyndale Gateway Development Sources and Uses Statement BUT FOR ANALYSIS SOURCES OF FUNDS Total Project Budget 1st Mortgage (Commercial Space) $3,854,812 City/State/Etc. $650,000 TI F $3,000,000 Equity Investment $1,200,000 Sales Proceeds $21,885,344 Grant-1 $500,000 Grant-2 $400,000 Gap Funding $1,000,000 TOTAL SOURCES OF FUNDS $32,490,156 USES OF FUNDS Total Project Budget Total Acquisition Costs $6,065,000 Total Construction Costs $17,822,644 Total Architectural/Engineering $541,660 iTotal Marketing $1,667,517 Total Carrying Costs $1,550,967 ,Total Special Consultants $597,000 Total Financing Costs $318,001 Total Title and Recording $169,501 Total Other Soft Costs $85,000 TOTAL USES OF FUNDS $28,817,290 Developer's Profit Margin 12.75% $3,672,866 L~ • APPENDIX APPENDIX G PRIOR PLANNED IlVIPROVEMENTS G-1 PERMIT CHFIELD Permit Type: sign _ ~ Permit Number: 047706 700 Portland Avenue South Richfield, MN 55423 ~ _ ~ Date Issued: 04/15/2002 612-861-9860 Site Address: 7600 LYNDALE AVE S Lot: Block: Addition: PID: 33-028-24-44-0036 Use: BUMPER TO BUMPER Description: Sub Type: COMMERCIAL Work Type: WALL Description: _ BUMPER TO BUMPER Sign Message BUMPER TO BUMPER AUTO PARTS Ft. In. Length: 24 Height: 3 Sq. Ft. 72 Location: EAST ELEVATION Has Electricity: Y emarks: Fee Summary: Permanent Sign 40.00 101-00-32224 $40.00 Valuation: $72.00 Contractor: -Applicant - Owner: UNIVERSAL SIGNS 1NC St. Lic.: CHAMPION AUTO STORES, INC 1033 THOMAS AVENUE 5520 N COUNTY ROAD 18 ST PAUL, MN 55104 (651)645-0223 1 MINNLAYVLlI, MN JJ4L2S This permit is issued on the express condition that all work shall be done in accordance with ordinances and building codes of the City of Richfield and the State of Minnesota. INSPECTION RECORD RICHFIELD Permit Type: Sign 700 Portland Avenue South Permit Number: RI0477Q6 chfield, MN 55423 Date Issued: 04/15/2002 612-861-9860 Site Address: Applicant: 7600 LYNDALE AVE S Lot: Block: Addition: 33-028-24-44-0036 Permit Subtype: COMMERCIAL Description: BUMPER TO BUMPER UNIVERSAL SIGNS 1NC 651-645-0223 Type of Work: WALL UseBusiness: BUMPER TO BUMPER Final r~ IL J Catl: 612-861-9860 For Bldg, Elec, Fire, & residential furn & a/c repl 952-563-8930 - Mech & Plbg. Call: 612-861-9165 for Sewer/Water PERMIT RICHFIELD Permit Type: sign 700 Portland Avenue South ~ ~ Permit Number: 047705 Richfield, MN 55423 ~ _ ~ Date Issued: 04/15/2002 61.2-861-9860 Site Address: 7600 LYNDALE AVE S Lot: Block: Addition: PID: 33-028-24-44-0036 Use: BUMPER TO BUMPER Description: Ft. In. Sub Type: COMMERCIAL Length: 12 Work Type: WALL Height: 3 Description: BUMPER TO BUMPER ~ Sq. Ft. 36 Location: NORTH ELEVATION Sign Message Has Electricity: Y BUMPER TO BUMPER AUTO PARTS emarks: Fee Summary: Permanent Sign Valuation: $36.00 25.00 101-00-322.24 $25.00 Contractor: -Applicant - UNIVERSAL SIGNS INC St. Lic.: 1033 THOMAS AVENUE ST PAUL, MN 55104 (651)645-0223 Owner: CHAMPION AUTO STORES, INC 5520 N COUNTY ROAD 18 1 M1NNbAYVL1J, MN JJ41S This permit is issued on the express condition that all work shall be done in accordance with ordinances and building codes of the City of Richfield and the State of Minnesota. INSPECTION RECORD RICHFIELD ~00 Portland Avenue South chfield, MN 55423 Permit Type: Sign Permit Number: RI047705 Date Issued: 04/15/2002 612-861-9860 Site Address: 7600 LYNDALE AVE S Lot: Block: Addition: 33-028-24-44-0036 Permit Subtype: COMMERCIAL Description: BUMPER TO BUMPER Applicant: UNIVERSAL SIGNS INC 651-645-0223 Type of Work: WALL UseBusiness: BUMPER TO BUMPER Final • Call: 612-861-9860 For Bldg, Elec, Fire, & residential Earn & a/c repl 952-563-8930 - Mech & Plbg. Cali: 612-861-9165 for Sewer/Water PERMIT RICHFIELD Permit Type: Electrical 704 Portland Avenue South ~ ~ Permit Number. 047704 Richfield, IvIN 55423 ~ _ ~ Date Issued: 04/1 I/2002 612-861-9860 Site Address: 7600 LYNDALE AVE S Lot: Block: Addition: PID: 33-028-24-44-0036 Use: BUMPER TO BUMPER AUTO PARTS Description: Sub Type: COMMERCIAL Work Type: SIGN Description: BUMPER TO BUMPER AUTO PARTS L~ Remarks: Fee Summary: Valuation: $500.00 Surcharge -Based on Valuation 0.50 703-207.10 Electrical Comm/Multi 40.00 101-00-322.12 $4050 Contractor: -Applicant - Owner: ELECTRIC SIGN REPAIR INC St. Lic.: CHAMPION AUTO STORES, INC 6807 BEARD AVE N 5520 N COUNTY ROAD 18 BROOKLYN CENTER, MN 55429 (651)646-6566 M1NNI;AYVLIS, MN 554"l8 permit is issued on the express condition that all work shall be done in accordance with ordinances and building codes of the of Richfield and the State of Minnesota. INSPECTION RECORD RICHFIELD 700 Portland Avenue South ~chfield, MN 55423 Permit Type: Permit Number: Date Issued: Electrical RI047704 04/11/2002 612-861-9860 Site Address: 7600 LYNDALE AVE S Lot: Block: Addition: 33-028-24-44-0036 Permit Subtype: COMMERCIAL Description: BUMPER TO BUMPER AUTO PARTS Applicant: ELECTRIC SIGN REPAIR INC 651-646-6566 Type of Work: SIGN UseBusiness: BUMPER TO BUMPER AUTO PARTS Final C Call: 612-861-9860 For Bldg, Elec, Fire, & residential Earn & a/c repl 952-563-8930 - Mech & Plbg. Call: 612-861-9165 for Sewer/Water PERMIT RICHFIELD Permit Type: sign . 700 Portland Avenue South ~ Permit Number: 047645 Richfield, MN 55423 ~ Date Issued: 04/05/2002 612-861-9860 Site Address: 7640 LYNDALE AVE S Lot: Block: Addition: PID: Use: MENA' S HAIR SALON Description: Sub Type: COMMERCIAL Work Type: WALL Description: PLYWOOD SIGN ABOVE FRONT ENTRA Sign Message MENA' S HAIR SALON Ft. In. Length: 6 Height: 4 Location: ABOVE FRONT ENT emarks: Fee Summary: Permanent Sign 25.00 101-00-322.24 525.00 Contractor: -Applicant - Owner: DAHLEN SIGN CO St. Lic.: MENA'S HAIR SALON 7947 LYNDALE AVE S 7640 LYNDALE AVE S BLOOMINGTON, MN 55420 (952) 888-3413 1 KIC:Hrl);Lll, MN S54'1j tS6`J-:f44y This permit is issued on the express condition that atl work shall be done in accordance with ordinances and building codes of the City of Richfield and the State of Minnesota. RICHFIELD 700 Portland Avenue South chfield, MN 55423 612-861-9860 INSPECTION RECORD Permit Type: Permit Number: Date Issued: Sign RI047645 04/05/2002 Site Address: 7640 LYNDALE AVE S Lot: Block: Addition: Permit Subtype: COMMERCIAL Description: PLYWOOD SIGN ABOVE FRONT ENTRA Applicant: DAHLEN SIGN CO 952-888-3413 Type of Work: WALL UseBusiness: MENA' S HAIR SALON Final • Call: 612-861-9860 For Bldg, Elec, Fire, & residential fern & a/c repl 952-563-8930 - Mech & Plbg. Cali: 612-861-9165 for SewerlWater PE1~:MIT CHFIELD ~ Pei-~n~t Type: Electrical ~ Permit Number: ..047498 700 Portland Avenue South 1Zichfield, MN 55423 ~ Date Issued: 03/21/2002 612-861-9860 Site Address: 7640 LYNDALE AVE S Lot: Block: Addition: PID: Use: MENA' S HAIR SALON Description: Sub Type: COMMERCIAL Work Type: REMODEL/ALT Description: MENA'S HAIR SALON Remarks: 2 EXHAUST FANS, DEMO, 3 DEDICATED WORK STATIONS. WIRE RE- CEPTACLE AIR EXCHANGED, INSTALL 2 FLORESCENT LIGHTS, ADD 3 RECEPTACLES SEPARATE CICRUIT. Fee Summary: Surchazge -Based on Valuation 0.50 703-207.10 Electrical Comm/Multi 40.00 101-00.322.12 ValuatiOri: $850.00 Investigation Fee 40.00 101-00-343.10 S80S0 Contractor: -Applicant - Owner: ADVANTAGE ELECTRIC St. Lic.: MENA'S HAIR SALON 917 142ND AVE NW 7640 LYNDALE AVE S ANDOVER, MN 55304 (763)413-1843 I tUl:tlt'lI;LU, MN JJ4LS permit is issued on the express condition that all work shall be done in accordance with ordinances and building codes of the of Richfield and the State of Minnesota. RICHFIELD 700 Portland Avenue South chfield, MN 55423 612-861-9860 INSPECTION RECORD Permit Type: Electrical Permit Number: RI047498 Date Issued: 03/21/2002 Site Address: 7640 LYNDALE AVE S Lot: Btock: Addition: Permit Subtype: COMMERCIAL Description: MENA'S HAIR SALON Applicant: ADVANTAGE ELECTRIC 763-413-1843 Type of Work: REMODEL/ALT UseBusiness: MENA' S HAIR SALON Final 2 EXHAUST FANS, DEMO, 3 DEDICATED WORK STATIONS. WIRE RE- CEPTACLE AIR EXCHANGED, INSTALL 2 FLORESCENT LIGHTS, ADD 3 RECEPTACLES SEPARATE CICRUIT. • Call: 612-861-9860 For Bldg, Elec, Fire, & residential furn & a/c repl 952-563-8930 - Mecb & Plbg. Call: 612-861-9165 for Sewer/Water PEl~:MI'T RICHFIELD Permit Type: Plumbing. 700 Portland Avenue South ~ ~ Permit Number: 047441 Richfield, MN 55423 ' _ ~ Date Issued: 03/15/2002 612-861-9860 Site Address: 7640 LYNDALE AVE S Lot: Block: Addition: PID: Use: MENA'S HAIR SALON Description: Sub Type: Work Type: Description: • COMMERCIAL REMODEL/ALT INSTALL SHAMPOO BOWL Remarks: NINA'S HAIR SALON Fee Summary: Valuation: $990.00 Surcharge -Based on Valuation 0.50 703-207.10 Commercial Plumbing 40.00 101-00-322.18 Investigation Fee 40.00 101-00-343.10 S80S0 Contractor: -Applicant _ Owner: SOUTHTOWN PLUMBING St. Lic.: 1784PM SECUNDINA CARRION 6636 PENN AVENUE 8213 QUEEN AVE S RICHFIELD, MN 55423 (612)866-3057 _ t t3LVVM1Nti 1 VN, MN »4.i 1 6111l1~U14 is permit is issued on the express condition that all work shall be done in accordance with ordinances-and building codes of the .y of Richfield and the State of Minnesota. INSPECTION RECORD RICHFIELD Permit Type: Plumbing ~00 Portland Avenue South Permit Number:. RI047441 ichfield, MN 55423 Date Issued: 03/15/2002 612-861-9860 Site Address: Applicant: 7640 LYNDALE AVE S Lot: Block: Addition: Permit Subtype: COMMERCIAL Description: INSTALL SHAMPOO BOWL SOUTHTOWN PLUMBING 612-866-3057 Type of Work: REMODEL/ALT UseBusiness: MENA' S HAIR SALON NINA' S HAIR SALON • Call: 612-861-9860 For Bldg, Elec, Fire, & residential furn & a/c repl 952-563-8930 - Mech & Plbg. Call: 612-861-9165 for Sewer/Water PERMIT RICIIFIELD rerlnit Type: Mechanical 700 Portland Avenue South ~ ~ Permit Number: 047398 Richfield, MN 55423 ~ ~ Date Issued: 03/12/2002 612-861-9860 Site Address: 7640 LYNDALE AVE S Lot: Block: Addition: PID: Use: MENA' S HAIR SALON Description: Sub Type: COMMERCIAL I Ventilation/Exhaust Work Type: MODEL/ALT Description: MENA'S HAIR SALON Remarks: VENT 2 EXISTING EXHAUST FANS,INSTALL.BATH EXHAUST FAN. Fee Summary: Valuation: $7,300.00 Surcharge -Based on Valuation HVAC. & Refrigeration 3.65 703-207.10 109.50 101-00-322.14 5113.15 Contractor: -Applicant - Owner: BLAINE HEATING 8i A/C & ELE St. Lic.: MENA'S HAIR SALON 13562 CENTRAL AVENUE NE 7640 LYNDAL AVE S ANOKA, MN 55304 " (763)757-6202 1 t(1C;1i1'II;Lll, MN JJ41j 2S6Y-S44y permit is issued on the express condition that all work shall be done in accordance with ordinances and building codes of the of Richfield and the State of Minnesota. RICHFIELD ~00 Portland Avenue South chfield, IVIN 55423 612-861-9860 INSPECTION RECORD Permit Type: Mechanical Permit Number: RI047398 Date Issued: 03/12/2002 Site Address: 7640 LYNDALE AVE S Lot: Block: Addition: Permit Subtype: COMMERCIAL Description: MENA'S HAIR SALON Applicant: BLAINE HEATING & A/C & ELE 763-757-6202 Type of Work: REMODEL/ALT UseBusiness: MENA' S HAIR SALON VENT 2 EXISTING EXHAUST FANS, INSTALL BATH EXHAUST FAN. 1 Ventilation/Exhaust • Call: 612-861-9860 For Bldg, Elec, Fire, & residential furn & a/c repl 952-563-8930 - Mech & Plbg. Call: 612-861-9165 for Sewer/Water PE~:MIT CIIFII+ I..D Permit Type: Building ~ Permit Number: 047367 700 Portland Avenue South Richfield, MN 55423 _ ~ Date Issued: 03/08/2002 612-861-9860 Site Address: 7640 LYNDALE AVE S Lot: Block: Addition: PID: Use: MENA' S HAIR SALON Description: Sub Type: COMMERCIAL UBC Occupancy: Work Type: REMODEL/ALT Construction Type: Description: MENA'S HAIR SALON Zoning: Census Code: Square Feet: emarks: Fee Summary: Valuation: $5,000.00 Surchazge - Based on Valuation Plan Review UBC-Building Permit Schedule Investigation Fee 2.50 703-207.10 72.31 1 Ol -00-341.12 111.25 101-00-322.10 111.25 101-00-343.10 5297.31 Contractor:. Owner: -Applicant - St. Lic.: ROBERT F EHRMAN 19401 RIDGELAND DR 1 M1AM1, PL SS1J7 SVJ-G3b-3 / 1G This permit is issued on the express condition that all work shall be done in accordance with ordinances and building codes of the City of Richfield and the State of Minnesota. RICHFIELD ~00 Portland Avenue South ~Zichfield, MN 55423 612-861-9860 Site Address: 7640 LYNDALE AVE S Lot: Block: Addition: Permit Subtype: COMMERCIAL Description: MENA'S HAIR SALON INSPECTION RECORD Permit Type: Permit Number: Date Issued: Applicant: ROBERT F EHRMAN 305-238-3712 Type of Work: REMODEL/ALT UselBusiness: MENA' S HAIR SALON Building RI047367 03/08/2002 Final Call: 612-861-9860 For Bldg, Elec, Fire, & residential Earn & a/c repl 952-563-8930 - Mech & Plbg. Call: 612-861-9165 for Sewer/Water PERMIT RICHFIELD Pel-lnit Type: suiiding 700 Portland Avenue South ~ ~ ~ Permit Number:. 045653 Richfield, MN 55423 ' _ ~ Date Issued: 10/09/2001 612-86I-9860 Site Address: 7640 LYNDALE AVE S Lot: Block: Addition: PID: Use: GRAYHAWK BLDRS Description: Sub Type: COMMERCIAL UBC Occupancy: Work Type: REROOF Construction Type: Description: REMOVE AND REPLACE ROOFING, 12 Zoning: Census Code: Square Feet: emarks: Fee Summary: Valuation: $4,442.00 Surchazge -Based on Valuation .222 703-207.10 License Verification Fee 5.00 101-00-342.14 UBC-Building Permit Schedule 111.25 101-00-322.10 $118.47 Contractor: -Applicant - Owner: GRAYHAWK BUILDERS St. Lic.: 20174611 GRAYHAWK BLDRS 3020 CENTERVILLE RD 3020 CENTERVILLE RD LITTLE CANADA, MN 55117 (651)486-9888 1 L1 l 1 Ll; l:A1VAllA, MN JJ 1 t / ()J 1-4256-1tS2S2S This permit is issued on the express condition that all work shall be done in accordance with ordinances and building codes of the City of Richfield and the State of Minnesota. INSPECTION RECORD RICHFIELD Permit Type: Building 700 Portland Avenue South ~ Permit Number: RI045653 chfield, MN 55423 Date Issued: 10/09/2001 612-861-9860 Site Address: Applicant: 7640 LYNDALE AVE S GRAYHAWK BUILDERS Lot: Block: Addition: 651-486-9888 Permit Subtype: Type of Work: COMMERCIAL REROOF Description: UseBusiness: REMOVE AND REPLACE ROOFING, l2 GRAYHAWK BLDRS Final • Call: 612-861-9860 For Bldg, Elec, Fire, & residential furn & a/c repl 952-563-8930 - Mech & Plbg. Call: 612-861-9165 for Sewer/Water Summary to Attachment D • U Ehlers and Associates City of Richfield, Minnesota Lyndale Gateway West Tax Increment Financing District Proposed action: • Modification to the Redevelopment Plan for the Richfield Redevelopment Project Area • Modification to the Tax Increment Financing Plan for the Interchange West and Lyndale Gateway Tax Increment Financing District • Establishment of the Lyndale Gateway West Tax Increment Financing District (Parcels of land are being eliminated from the Interchange West and Lyndale Gateway Tax Increment Financing District in order to establish the Lyndale Gateway West TIF District. Please note that this matter does not impact any parcels in the Interchange West District. It is only for parcels in that portion of the Lyndale Gateway District that will become part of the new Lyndale Gateway West TIF District.} Type of TIF District: A Redevelopment District Parcel Numbers: 33-028-24-44-0036 33-028-24-44-0044 33-028-24-44-0051 33-028-24-44-0037 33-028-24-44-0045 33-028-24-44-0050 33-028-24-44-0038 33-028-24-44-0046 33-028-24-44-0047 33-028-24-44-0039 33-028-24-44-0056 33-028-24-44-0048 33-028-24-44-0040 33-028-24-44-0055 33-028-24-44-0049 33-028-24-44-0041 33-028-24-44-0054 33-028-24-44-0042 33-028-24-44-0053 33-028-24-44-0043 33-028-24-44-0052 Proposed The Lyndale Gateway West Tax Increment Financing District is being created development: to facilitate an integrated development of housing, commercial, parking and new public facilities, utilities, streetscape, and other improvements. Estimated annual tax The estimated annual tax increment is $299,066. The actual tax increment will increment: be based on property values and tax rates beginning in taxes payable 2003. Proposed uses: The TIF Plan contains the following budget: LandBuilding Acquisition ............................ $3,300,000 Interest ............................................. 3,458,879 Administrative Costs (up to 10%) ..........................717.757 Total ............................................. $7,476,636 Form of financing: Pay-as-you-go note Maximum duration: The duration of the District will be 25 years after receipt of the first increment by the City (a total of 26 years). The date of receipt by the City of the first tax increment is expected to be 2005. Thus, it is estimated that the District, including any modifications of the Plan for subsequent phases or other changes, would terminate after 2030, or when the Plan is satisfied. The HRA or City reserves the right to decertify the District prior to the legally required date. Administrative fee: Up to 10% of annual increment for eligible costs. • • n U TIF District Overview LGA/HACA penalty: The 2001 Legislature eliminated the provisions for a reduction in state tax increment financing aid (RISTIFA) or the alternative qualifying local contribution. 3 Year Activity Rule At least one of the following activities must take place in the District within 3 (§469.176 Subd 1 a) years from the date of certification: ^ bonds have been issued ^ the authority has acquired property within the district ^ the authority has constructed or caused to be constructed public improvements within the district The estimated date whereby this activity must take place is December 2005. 4 Year Activity Rule After four years from the date of certification of the District one of the (§ 469.176 Subd 6) following activities must have been commenced on each parcel in the District: ^ demolition - ^ rehabilitation ^ renovation ^ other site preparation (not including utility services such as sewer and water) If the activity has not been started by the approximately December 2006, no additional tax increment may be taken from that parcel until the commencement of a qualifying activity 5 Year Rule Within 5 years of certification revenues derived from tax increments must be (§ 469.1763 Subd 3) expended or obligated to be expended. Tax increments are considered to have been expended on an activity within the District if one of the following occurs: ^ the revenues are actually paid to a third party with respect to the activity ^ bonds, the proceeds of which must be used to finance the activity, are issued and sold to a third party, the revenues are spent to repay the bonds, and the proceeds of the bonds either are reasonably expected to be spent before the end of the later of (i) the five year period, or (ii) a reasonable temporary period within the meaning of the use of that term under §. 148(c)(1) of the Internal Revenue Code, or are deposited in a reasonably required reserve or replacement fund ^ binding contracts with a third party are entered into for performance of the activity and the revenues are spent under the contractual obligation ^ costs with respect to the activity are paid and the revenues are spent to reimburse for payment of the costs, including interest on unreimbursed costs. Any obligations in the Tax Increment District made after approximately December 2007, will not be eligible for repayment from tax increments. The previous summary contains an overview of the basic elements of the proposed Tax Increment Financing Plan for the Lyndale Gateway West Tax Increment Financing District, located within the Richfield Redevelopment Project Area. More detailed information on each of these topics can be found in the complete TIF Plan. Page 2 • TIF District Overview Map of the Lyndale Gateway West Tax Increment Financing District Richfield Redevelopment Project Area City of Richfield, Minnesota • • Page 3 UY03 WB WC WB U NOIJNN0011 ~ "~ W-i !- ~ W~~ ~, p W~~ W~~ Q Z ~,an~ ((,~ oovaNa N ' ` 3C16Nn10~ L v 7iadd Q ~ ~ ONV7X110 .`~"'. '~ '. aNVUaod Z ~ Ws W (~ ~ O ~ Nolwri N Z we W puz tea.. ~ s Al Z ~ 131'W~N n30SM4 U NLaOMW3M a z Z A a e O Q X 6NY1~ W Q ta~aavN o~av~ W ~ 37YONAl Q (n rr~amr W 1NYAaH W xrnm ~ ~ LL 1NOdn0 Q ~ NOSa3N3~ ~ Q uaN3ui W aavaro e~ 1A108MnH `^~~ 'JtiJ~la ` S3XYC V ~ ~~X ~ NYOO, LLB W Nv~aoN J N01M3N Q a~vm ?Bi3d Z N33n0 ~,,, n3ssna J NvrnaaNs ~~ Notdn iN3~NA NanBiSYM 53Xa3X x $$+ s c a s s O tl 0 tl O ~ tl ~ ~~ A ~. ^ A A A ~ n = ~z o N O_ !JJ aY03~. - m WB! ~ Wit -.. ~ ~ ~ vmt p NolJNNOOl4 4Kl W-t WL{ Wzt W-~ .., Wog ~ :~ soma w o~w,aNO ~ SnBNfiWy ~ ~ ~ ~ C card ~ ~3 awronvo ~ oNVnaod p C WS m LL Wf ~ C Noura Q ~ U ~ W2 m V .... Stan~~e 0 uc d ~ 13n071N C d1 r n34SMY ~ dl NLaOML18M Q ~anesrnd O m ~ lANStl37d ~ ~ ONYaO ~raarN ~ C m~a~ ~ U' ana,ax, m m . is N~ilIQ7Y ,_ ~ 1NV1U19 ~ U_ C XrdlO~ ~ J 1NOdna Nosa~n 1NOwaaa oarae~ amoeNnN °JlMa! S37YC XOWi NiFJOI Nr~aoir NO1N13N ayuw .., NN3d N a° N33n0 "lL n$Sfla O ~. O a NraaaNS N w _T $~Nl NO~dt}~ ~ e 1H3~NA O r NanBHSYM ~ p S3XM3X ~ o r m N O O O r Z Attachment E ~ Blight Assessment Lyndale Gateway West Area Richfield, Minnesota November 12, 2002 Prepared by: Short Elliott Hendrickson Inc. (SEH) Butler Square Building, Suite 710C 100 North 6t'' Street Minneapolis, MN 55403 SEH No. A-RFHRA00302.00 • I. Introduction/Purpose of Report The Lyndale Gateway West Area is one single city block, comprising twenty-one (21) properties bounded by Lyndale Avenue, Aldrich Avenue, 76th Street West and 77th Street West (See small map below, the larger map in Attachment A, and Table 1 on the next page). Nine (9) of the properties are located on Aldrich Avenue South; eight (8) of these properties are used for residential purposes; one (1) is owned by the City of Richfield and used for right-of--way purposes. Thirteen (13) of the properties are located on Lyndale Avenue South. Eleven (11) of these properties are used primarily for commercial purposes, while two (2) are owned by the City of Richfield, part of the right-of--way for 77th Street West. • The purpose of this report is to analyze the Lyndale Gateway West Area to determine if it meets the following definition for "Blighted Area" according to Chapter 469 of Minnesota Statutes: "Blighted area (contains) buildings or improvements which by reason of dilapidation, obsolescence, overcrowding, faulty arrangement or design, lack of ventilation, light, and sanitary facilities, excessive land coverage, deleterious land use, or obsolete layout, or any combination of these or other factors, are detrimental to the safety, health, morals, or welfare of the community." • Blight Assessment Lyndale Gateway West Area -Richfield, Minnesota Short Elliott Hendrickson Inc. November 12, 2002 Lyndale Gateway West Area Table 1 PIN#'s and site addresses of the Lyndale Gateway West Area Properties • Lyndale GatewayWest Site Addresses Property Identification Numbers (PIN) 3302824440056 7601 Aldrich Ave S 3302824440055 7609 Aldrich Ave S 3302824440054 7615 Aldrich Ave S 3302824440053 7621 Aldrich Ave S 3302824440052 7627 Aldrich Ave S 3302824440051 7633 Aldrich Ave S 3302824440050 7639 Aldrich Ave S 3302824440049 7645 Aldrich Ave S 3302824440036 7600 Lyndale Ave S 3302824440037 7608 Lyndale Ave S 7610 Lyndale Ave S 7612 Lyndale Ave S 3302824440038 7614 Lyndale Ave S 7616 Lyndale Ave S 7618 Lyndale Ave S 3302824440039 7620 Lyndale Ave S 7622 Lyndale Ave S 7624 Lyndale Ave S 7626 Lyndale Ave S 3302824440040 7632 Lyndale Ave S 7634 Lyndale Ave S 3302824440041 7628 Lyndale Ave S 7628 I/z Lyndale Ave S 3302824440042 7630 Lyndale Ave S 7630 t/z Lyndale Ave S 3302824440043 7634 Lyndale Ave S 7636 Lyndale Ave S 3302824440044 7638 Lyndale Ave S 7640 Lyndale Ave S 3302824440045 7642 Lyndale Ave S 7642'h Lyndale Ave S 3302824440046 7644 Lyndale Ave S 76441/z Lyndale Ave S 3302824440047 7648 Lyndale Ave S 3302824440048 7646 Lyndale Ave S • Blight Assessment Lyndale Gateway West Area -Richfield, Minnesota Short Elliott Hendrickson Inc. November 12, 2002 11. Summary Analysis and Conclusion Summary Analysis Individually, eighteen (18) of the twenty-one (21) properties exhibit one or more of the criteria for a finding of blight. This assessment is presented in Attachment B (Table Z). Photos that illustrate the presence of the blighting criteria on selected individual and groups of properties are contained in Attachment C. Viewed as a whole, the entire block, including the public alley, is negatively influenced, and impacted by, the presence of blight on the individual properties located in the block. See the summary analysis below (and detailed analysis in Attachment D). Dilapidation These properties were developed between 1947 and 1952. The improvements are not considered to have historical value nor architectural merit. Over half of the structures and site improvements exhibit advanced states of deferred maintenance and disrepair. ^ Obsolescence/Obsolete Layout Over half of these properties exhibit dysfunctional layout of buildings and parking, as well as an outdated appearance that is not consistent with contemporary needs and preferences. ^ Fault~n~ement or design All eighteen of the properties that contain structures exhibit faulty arrangement or design, exemplified in the inadequate parking provision, and inconvenient/unsafe pedestrian vehicle access. The properties are served by a narrow alley creates unresolved conflicts between commercial loading/parking and residential access to garages. ^ Excessive land coverage Ten (10) of the eleven (11) commercial parcels exhibit this criterion in terms of size/lot coverage and placement of the commercial buildings. The remaining site area available for parking, loading, and access is inadequate. ^ Other factors Other blighting factors include the poor linkage/transition between the residential and commercial properties, the conditions within the public rights-of--way, overgrown vegetation, and the economics of renewaUreinvestment. Blight Assessment Lyndale Gateway West Area -Richfield, Minnesota Short Elliott Hendrickson Inc. November 12, 2002 4 Conclusion SEH has also reviewed the above referenced properties to determine if the buildings situated on parcels within the study area are structurally substandard under tax increment law (Minnesota Statutes, Section 469.174, and Subd. 10). Assessment for structural substandard conditions has resulted in findings (see separate report) that the majority of the buildings situated in the Lyndale Gateway West Area do in fact meet the statutory definition. Therefore, the evidence of blight conditions exhibited on an individual ~roperty-b~ property basis, as well as when the properties were analyzed collectively combined with the finding of substandard conditions for most the individual buildings, is of such a compelling nature that we have drawn the conclusion that these conditions provide a strong basis for finding that the Lyndale Gateway West Project Area meets the statutory definition fora "Bli~llted Area." • Blight Assessment Lyndale Gateway West Area -Richfield, Minnesota Short Elliott Hendrickson Inc. November 12, 2002 Attachment A Cl • • CITY OF RICHFIELD Legend Hennepin Gounry ~ Project Boundary REDEVELOPMENT ELIGIBILITY coordinate system cft) Q Parcel Boundaries Source: Hennepin County, ASSESSMENT city of Richfield and SEH. o w too t voarzooz sn Feet ~~~ Project Location sao;oe; aay;o ;no/Cel a;alosgo - - asn ue snol~a;a a p I I p i a6eaanoo puel anlssaoxa --- sal;llloe; iGe;hies;o ~loel ;46iI/uo!;ell;uan;o ~1~e1 uBlsap/s;uawaBue~~e ~(;lne; ', 6ulpnno~~~ano aouasalosgo ~, uoi;epide~ip Q ~ I ~ ~ ~ ~ I ~ a~ a~ m - cn cn cn cn > > a ~ _ ( 7 Q Q c a ~ a~ a~ a~ a~ a> ~ > Q Q cn cn Q Q , , ~~ J J ~~ NN ~~~ m > > CO~~~QQ-m -m , , a o O ~~~~~ N N~ j N OJ C M J J a '~ J J>> N O > > > > > > > Q Q ' ~ Q Q (~D CEO CO ~ N N J. 1, ~ N Q Q Q Q Q Q Q Z L L L L L L L N Q ~ ~ J J A N N U U U U U U U L~ O CO N N~ O CO O N~~~ y O N U a ~ N M N M M 7 V V~~ ~ a ' "O a s ~ O "i C CO CO O M M M M O O O~~ y _ _ _ Q Q Q Q Q Q Q Q J~~~~~~ r~ r~ J J ~ ~ ~ r- 07 ~ ~ I~ M O ~ O OJ ~ O N M O V c0 N ~ ~ cD O O N N M M V O O~ N M N M M M V V~~ Z '6 Q M O O O O M O O O O O O M M M M M O O O M f~ ~ r ~ ~ r ~ ~ ~ ~ ~ ~ ~ r ~ ~ r ~ ~ ~ ~ _ ~ ~ ~ w ~ to Q ~--~ ~ ~ ~ I ~ N , T ~ U U ~ ~ ~ ~ ~ ~ LL ~ ~ N N N ~ ~, U~ U U U U L v c Q i m ~ io m ~ is .~ a~ ~' a~ 3 y ' m m N ' ~~ ~~ .~+ W ~- ~ w ~ E E E E E ~~ ~ ~~~ ~ m r E a ~ E E E E~~ W ~ o ~ ~ C c c c c c c c 3 0~~ 0 0 0 0 ~ ~' o c ~ ~ ~ ~ ~ ~ ~ V ' c ~ ~ _ _~ ~ ~ ~ ~ ~ a -moo -~~o .~ .~ .m ca .~ ~ .~ 'm co 'co .m ~ -moo 0 o ~ ~ N N ' J I Z IL U ~ ~ ~ ~ N N N ~ ~ Q ~ ~ ~ ~ ~ ~ ~ 1~ Q CA ~ ~ W '~ O (O to ~ M N O O CD ~ ~ O O ~ N M V ~ CO I~ ~ :~=~ ~ tf7 ~~~~~ V M M M M~~ V ~t V V V V V C ~ z O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O O G ~~~~~a~~~~~~~~~~~~~~~ _ J ~ vvvvvv~~~~r~tvvvvvvvv~~ U N Q N N N N N N N N N N N N N N N N N N N N N y o~ co m m m m ~ co co co o~ co co o~ o~ m m o~ o~ w w Q w = N N N N N N N N N N N N N N N N N N N N N X 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 J J a M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M Q " ~ F- w • [7 ~'J • Lyndale Gateway West -Report on Blight Assessment Photographs ~''- ~~ r' w~, III ; ~ ~ y'~ _ --- r ~ x ,,fix. i~,~~ Photo 2: A different view from the alley of a commercial property illustrates another poorly maintained site and a building. The building entrance and loading areas are clearly in disrepair and the overgrown site and boarded up windows are a telltale sign of deferred maintenance. Attachment C Photo 1: This view from the alley of the back facade and loading/service area of one of the commercial parcels illustrates a poorly maintained building and site. Numerous criteria from the statutory definition for blight were observed on this property including but not limited to: "dilapidation, obsolete layout, and excessive land coverage." _ - - 4 rl ~:, :,~.~ _. ~. ~ ~ ._ a Photo 3: This view of the backside of a commercial property provides another example of a poorly maintained site and building. Blighting conditions include cracked and buckling pavement, overgrown vegetation and peeling paint on the building facade. This poorly maintained paved area represents the only on-site parking and loading/service area available for the property. L' Lyndale Gateway West -Report on Blight Assessment Photographs e • Photo 5: This decrepit looking shed- style addition to one of the commercial buildings represents a classic example of a blighting influence. The structure exhibits a sagging roof, peeling paint, rotting clapboard and boarded up windows. Attachment C Photo 4: This close-up view of the stairs to a service (back) entrance to 7618 Lyndale Avenue reflects a serious state of disrepair. The condition is indicative of the pattern of disinvestment that is prevalent throughout the project planning area. Photo 6: This two story back extension off one of the commercial structures includes masonry that is discolored and in disrepair. The unattractive appearance and poor maintenance of this part of the structure constitute conditions of blight. For example the criteria of "obsolescence" and "dilapidation" are evident on this property. • n. u Lyndale Gateway West -Report on Blight Assessment Photographs Photo 8: Another view of the parking occurring within the Lyndale Avenue Right-of--Way further demonstrates the "faulty design and arrangement" or "obsolete layout" reflected by this unusual arrangement. The vehicles parked along these store fronts do not have enough space to turn-around in order to avoid having to "jump the curb" onto Lyndale Avenue. Attachment C Photo 7: This photo effectively illustrates the awkward parking arrangement along the facades of the commercial buildings. Combined with the invasive vegetation that has not been pruned back or removed, the building entry appears to be practically inaccessible. Photo 9: This photo illustrates a roof and the soffit/fascia on this residence in need of replacement due to age and lack of regular maintenance. The condition of the structure reflects the blight criterion of dilapidation and the overgrown condition of the yard fits the criterion of "other factors". r~~ ~J e Lyndale Gateway West -Report on Blight Assessment Photographs Attachment C Photo 10: This narrow alley serves as the primary vehicular access for on-site parking and loading/service needs for the majority of properties in the project planning area. The inadequacy and traffic safety concerns posed by this substandard site access reflect the blight criteria of "obsolete layout and faulty design and arrangement." Photo 11: The informal use of the paved right-of--way in front of the commercial buildings for parking represents a traffic safety concern. This area has a single driveway access and its limited width will not allow for proper turning movements for most vehicles. The conflicts with vehicles parked on Lyndale Avenue and pedestrians are especially problematic during winter months. Photo 12: The only conveniently located on-site customer parking is situated at 7600 Lyndale Avenue. However this parking area exerts a blighting influence due to its poor maintenance, unattractive appearance and poor design. • Attachment D Detailed Analysis of Blight Conditions Lyndale Gateway West Area Statutory Definition of Blighted Area "Blighted area (contains) buildings or improvements which by reason of dilapidation, obsolescence, overcrowding, faulty arrangement or design, lack of ventilation, light, and sanitary facilities, excessive land coverage, deleterious land use, or obsolete layout, or any combination of these or other factors, are detrimental to the safety, health, morals, or welfare of the community." 1. Dilapidation The residential and commercial properties were constructed between 1947 and 1952. • Even though these properties, as well as the existing commercial and residential improvements constructed on them, can be considered old, they are not considered to have any historical value nor architectural merit. Old properties, however, require relatively higher levels of maintenance and repair. Over half of these properties can be considered to be lacking in needed maintenance and repair. The criterion of "dilapidation" was observed to apply to twelve (12) parcels within the project planning area. As indicated in Table B of this report, six (6) of parcels exhibited "strong" evidence of this criterion while another six (6) parcels exhibited "moderate" evidence. a. Deferred maintenance of structures and site improvements. b. Buildings and paved surfaces in disrepair a. Deferred Maintenance: Specific evidence of deferred maintenance includes: • Poorly maintained exterior building surfaces including masonry, stucco, wood clapboard and metal siding. • Back yard areas overgrown with vegetation. • Cracked, rutted paved surfaces. • Windows & Doors: cracked, ajar or boarded up. Excluding the three city owned properties that have become part of the 77"' Street Right-of-Way, over 57% of these properties (12 of 18 parcels) exhibit a deferred maintenance pattern. As determined by the analysis of Substandard Conditions (see separate report), on average, over 18% of the cost of constructing new buildings of • the same square footage and type on the same sites would have to be spent to remedy this blighting factor. The likelihood of this level of remodeling/renovation reinvestment is low, given that the resultant "product" would be expensive to lease/sell and remain relatively unattractive in terms design and layout. In addition, individual owners would be reluctant to make the required level of investments to their individual properties, given the context of the deteriorating nature of adjacent and nearby properties. b. Building and paved surfaces in disrepair: Specific evidence of buildings and paved surfaces in disrepair includes: • Masonry surfaces broken and in need of tuck-pointing. • Broken windows • Windows and Doors ajar and inoperable. • Entry stairways and service/loading docks broken and failing. • Cracked, broken and crumbling paved surfaces. • Shed-style addition broken and sagging (7600 Lyndale) The twelve properties exhibiting moderate to strong evidence of "dilapidation" include a wide variety of building surfaces and site improvements in a state of significant disrepair. The obvious dilapidation of each of commercial properties and one of the residential properties (7633 Aldrich Ave S) represent a clear blighting influence on abutting properties. In addition, the problems with • windows, doors, building surfaces and pavement negatively impact the current use and future prospects for these properties. 2. Obsolescence/Obsolete Layout The criteria of "obsolescence" and "obsolete layout" were observed to apply to eleven (11) parcels within the project planning area. As indicated in Table 2 of Attachment B of this report, ten (10) of parcels exhibited "strong" evidence of these criteria and one (1) additional parcel exhibited "moderate" evidence. a. Dysfunctional layout of buildings and parking. b. Substandard design of alley. c. Dated appearance of structures. a. Dysfunctional layout of building and parkin: Ten of the eleven commercial parcels are without adequate or convenient parking for customers or visitors based on the layout of the building at zero front lot line. The only available on-site parking for these properties is in the rear yard areas. The majority of these rear yard areas are overgrown with vegetation with paved or gravel surfaces in poor condition. In addition, parking and loading/service areas are not segregated or • clearly identified. • b. Substandard design of alley: A narrow alley more suitable for strictly residential use serves as the primary access to on-site parking and loading for the commercial properties. The alley also provides access to detached garages for three of the single-family homes that front on Aldrich Avenue. In addition to its narrow width the alley is partially overgrown with vegetation encroaching from residential properties. Overall the alley represents an inconvenient and potentially unsafe primary site access for the majority of parcels within the project planning area c. Outdated appearance of structures: All of commercial buildings were originally constructed between 1947 and 1952. Little evidence of regular maintenance, updating or major rehabilitation is evident on the exteriors of any of theses structures. As stated in Paragraph 1 (Dilapidation), these buildings "are not considered to have any historical value nor architectural merit," and they in fact tend to serve as remnants from a past era that are not consistent with contemporary needs and preferences of retail and commercial service uses. 3. Faulty arrangement or design The criterion of "faulty arrangement or design" was observed to apply to eighteen (18) parcels within the project planning area. As indicated in Table B of this report, ten (10) of parcels exhibited "strong" evidence of this criterion while another eight (8) parcels exhibited "moderate" evidence. a. Inadequate parking. b. Inconvenient pedestrian and vehicular access. c. Substandard alley. a. Inadequate P\parkin~: Ten (10) of the eleven (11) commercial properties fronting on Lyndale Avenue South are relatively shallow in terms of current standards. They back onto a narrow (12-foot-wide) alley. This results in a poorly functioning, obsolete parking and loading service area. The lack of legal parking in front of the properties, due to the fact that these properties front onto aCity- owned right-of--way which is not used for street purposes, compounds the parking and loading deficiencies. This situation produces a blighting influence to surrounding properties, as commercial tenants' employees, suppliers, and customers seek out nearby parking opportunities b. Inconvenient pedestrian and vehicular access: The awkward and confusing parking arrangement in that occurs in the Lyndale Avenue Right-of-Way in front of the commercial properties conceals building entrances and represents a safety hazard for pedestrians. This ill-defined informal parking area conflicts with pedestrian access to the commercial uses and is likely to present a particularly undesirable site condition in winter months during conditions of snow and ice. The substandard design of the alley that serves as the primary access for the majority of parcels in the project planning area (see paragraph 2. Dilapidation} also serves as a clear representation of this criterion. Current design standard for a major site access would require a minimum 22-24 foot wide drive width. c. Substandard alley. See Paragraph 2 (Dilapidation) and Paragraph 5 (Other Factors). 4. Excessive Land Coverage The criterion of "faulty arrangement or design" was observed to apply to eighteen (18) parcels within the project planning area. As indicated in Table B of this report, ten (10) of parcels exhibited "strong" evidence of this criterion while one (1) additional parcel exhibited "moderate" evidence. a. Size and placement of commercial buildings. a. Size and placement of commercial buildings: Ten (10) of the eleven (11) commercial parcels exhibit this criterion due to the size of the buildings relative the amount of remaining site area available for parking, loading, and access. As referenced in Paragraph 3 (Faulty Design and Arrangement),s the placement of the commercial buildings at azero-front-setback exacerbates the problem of excessive • land coverage because the principal access points to the buildings are located on the Lyndale Avenue side (front), making it impractical to provide convenient on-site parking. 5. Other Factors In addition to the above, the following other blighting factors were evident: a. Poor linkage between residential and commercial properties. b. Negative conditions within public rights-of--way. c. Overgrown vegetation. d. Economics of renewaUreinvestment. a. Poor linkage between residential and commercial properties: Various blighting influences that impact the project planning area reflect a linkage between the commercial (east half of block) and residential (west half of block). The limited depth of the commercial parcels combined with the poor condition of the back sides of those properties starkly illustrates that any reuse/rehabilitation solution would need to encompass the entire block. Due to the high traffic conditions in the area, the lack of on-site parking for commercial uses, and the substandard • design of the alley; viable use or reuse of the commercial sites may necessitate redevelopment of the residential half of the block. b. Negative conditions within the public rights-of-way: • The awkward, inconvenient, and unsafe condition and use of the paved right-of-way located between the commercial buildings and Lyndale Avenue (edge of curb). • The substandard design of the alley serving commercial and residential properties. • The obsolete design of the parking area serving 7600 Lyndale Avenue. • The safety concern associated with the detached garage at 7601 Aldrich that gain access from 76`~ Street. The above referenced conditions within public right-of--way represent a blighting influence the impacts the entire project planning area. Vehicular and pedestrian access is compromised by the substandard and antiquated arrangement of driveway cuts, paved surfaces, parking and driveways serving the majority of parcels. c. Overgrown Ve etg ation: Overgrown vegetation present on nearly all of the commercial parcels and several of the residential parcels represents a blighting influence consistent with the intent of the statutory definition for a blight area. This condition of deferred site maintenance is not characteristic of the majority of Richfield's mature neighborhoods. d. Economics of renewaUreinvestment: In addition, the physical and economic difficulties associated with lot-by-lot, or building-by-building, renewal of these 21 properties lead to the conclusion that this type and form of reinvestment is unlikely to occur. A renewaUreinvestment scenario that would take the form of total redevelopment appears more likely, more desired, and more feasible in terms of producing property design layout and land use mix that would be market- sensitive and would contribute to the near-term and future health and welfare of the Richfield community. • Attachment F Hennepin County Taxpayer Services Department A-600 Hennepin County Government Center Minneapolis, Minnesota 55487-0060 November 22, 2002 John StarK City of Richfield 6700 Portland Avenue South Richfield, MN 55423 Re: Richfield Lyndale Gateway West Redevelopment TIF District Dear Mr. Stark: Enclosed is a report from Richard P. Johnson, Hennepin County Deputy Administrator, to the Hennepin County Board of Commissioners, concerning the proposed Richfield Lyndale Gateway West Redevelopment TIF District. Please arrange to have the report entered into the record of the public hearing of the Richfield City Council on Tuesday, December 10, 2002, to reflect the input of Hennepin County, as provided by Minnesota Statutes, Section 469.175, Subd. 2. If you have any questions about this information, please call me at 612-348-5076. Sincerely, ~~ ~~~~ Jean M. Bierbaum, Senior Administrative Assistant Administrative Services Division Cc: Katia Medvetski and Bruce Palmborg, City of Richfield Sid Inman, Ehlers 8 Associates, Inc., 3060 Centre Pointe Drive, Roseville, MN 55113-1105 RevuRichfieldLyndaleGatewayWest12102002JTransmittalLetter An Equal Opportunity Employer Re[yded Paper ~ ~~~Memo DATE: November 22, 2002 TO: Board of County Commissioners (~ FROM: Richard P. Johnson, Deputy County Administrator. ` ,~ SUBJECT: Proposed Richfield Lyndale Gateway West Redevelopment TIF District Public. Hearing Date scheduled for Tuesday, December 10, 2002, at the Richfield City Hall. Proposal: Richfield proposes creation of a new 21-parcel Redevelopment TIF District to facilitate the construction of a mixed-use housing, commercial, parking and green space and pedestrian paths at 76'" and Lyndale Avenue South. Development is expected to begin in the spring of 2003. The Plan calls for construction of 93 condo units at a per-unit sale price of $195,000, 15 townhomes at a per-unit sale price of $260,000, 24,717 square feet of retail and 2,171 square feet of office space. Eighteen of the 21 parcels are currently part of the Lyndale Gateway TIF District. They have not been developed as part of that TIF District and will be decertified to become the Lyndale Gateway West TIF District. Neither the Redevelopment nor But/For qualifications were included with the TIF Plan, which states that they will "be added to prior to the public hearing.° Fiscal Impact: The Plan currently calls for financing by a pay-as-you go note or a bond issue. If bonds are issued, the principle will not exceed $6,000,000 without a Plan modification. The Redevelopment TIF District will have a duration of 25 years from receipt of the first tax increment. Sources of Funds Total Tax Increment 57.524.712 Total Project Revenues 57,524,712 Public Development Use of Funds Cost Land & Building Acquisition* $3,300,000 Interest 3,472,241 Administrative costs 752.471 Total Project Costs: 57,524,712 Continued... • November 22, 2002 Board of County Commissioners Proposed Richfield Lyndale Gateway West Redevelopment TIF District Page 2 SUMMARY: The Hennepin County Board of Commissioners' preference for use of tax increment financing, as identified in Resolution 92-10-917R1, adopted 10/27/92, is that TIF be used as a financing tool of last resort, targeting public assistance to renewal and redevelopment projects of greatest need and lower income housing projects of demonstrated need and that the TIF District be terminated in the shortest time possible. The TIF Plan submitted to Hennepin County did not contain either the Redevelopment or the But/For qualifications. However, that information is to be added to the TIF Plan "prior to the public hearing" and may be contained in the Plan sent to Hennepin County by November 8, 2002. In the meantime, the TIF Proposal far the Richfield Lyndale Gateway West Redevelopment TIF District provides no explanation why TIF is a funding tool of last resort. The TIF Plan does not identify the redevelopment as a project of greatest need. None of the proposed housing is identified as lower income housing, and the TIF District is projected to have a maximum duration of 26 years. Therefore, it appears that this TIF proposal does not satisfy the Hennepin County Board of Commissioners' preference for use of Tax Increment Financing. A copy of this report will be sent to the Richfield Housing and Redevelopment Authority with a request that it be entered into the record of the public hearing scheduled for Tuesday, December 10, 2002, to reflect the County's position on this proposal. • (w:RevuRichfieldLyndaleGatewayWest12102002J) • • AGENDA SECTION: ~~I j (,,~Ji.Y'j.~lLj S AGENDA ITEM # ~ REPORT # ~j j 3 ~' STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 • REPORT PREPARED BY: BETSY CxIUSTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: ~ ~~ SIGNATURE REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 pawnbroker and secondhand goods dealer licenses for Ca ital Cash LLC, d/b/a H 's Pawn, 6414 Nicollet Avenue South. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of pawnbroker and secondhand goods dealer licenses for Capital Cash LLC, d/b/a Hv's Pawn, 6414 Nicollet Avenue South. • II. BACKGROUND On October 18, 2002, the City received the renewal application and other required documents for pawnbroker and secondhand goods dealer licenses for Capital Cash LLC, d/b/a Hy's Pawn, 6414 Nicollet Avenue South. The applicant has paid the required license fees. The Public Safety background investigation has been completed and reveals the following: Jory Herman is 40% owner of the business and acts as chief executive officer. Michael Strauss is also 40% owner of the business and is the acting chief financial 1210 Hy'sPawnRenewal Pawnbroker. Licenses officer. Andy Strauss and Daniel Berdass are each 10% owners of the business. . None of these individuals has any known criminal record. Michael Strauss and Jory Herman currently own Hy's Pawn & Jewelry, 1025 Currie Avenue North, Minneapolis, MN. Michael Strauss currently acts as president and chief financial officer of the establishment. A copy of the Articles of Incorporation has been provided and is on file with the City. A $1500 bond has been submitted. There has been twelve Public Safety contacts for this location in the past year. This compares to six contacts from the previous year. A breakdown of these contacts is attached to this report. Environmental Health staff received two complaints regarding this location in the past year. The complaints were regarding snow being plowed onto the sidewalk and long grass. The property owner was notified and no further complaints have been received. The owners of the business agree to act in a cooperative manner with the Public Safety Department on the recovery of stolen articles. The notice of public hearing was published in the Sun Current newspaper on • November 21, 2002. III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of the City codes pertaining to pawnbroker and secondhand goods dealer licensing. • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to -deny the issuance of the licenses requested. B. CRITICAL ISSUES • N/A C. FINANCIAL • N/A D. LEGAL • N/A IV. ALTERNATNE RECOMMENDATION(S~ • The Council could decide to continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of a temporary license to allow the applicant to continue the pawnbroker and secondhand goods dealer business until the rescheduled hearing can be • conducted. V. ATTACHMENTS • List of officers. Breakdown of Public Safety contacts. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Jory Herman, Owner • Michael Strauss, Owner • . Capital Cash, LLC d/b/a Hy's Pawn Officers Jory Herman Owner/Chief Executive Officer Michael Strauss Owner/Chief Financial Officer Daniel Berdass Owner Andy Strauss Owner POLICE & FIRE CONTACTS October 2001 -September 2002 2001 2002 TOTAL CONTACTS 6 12 CRIMINAL CONTACTS 6 11 Incidents (see bottom of page for specifics) (2) (3) Alarm (4) (8) MISC. NON-CRIMINAL 0 1 Assists (0) (1) Traffic (0) (0) Inspections/Licensing (0) (0) Medical/Fire (0) (0) The criminal contacts from October 2001 through September 2002 were: one theft, one received stolen property, one disturbance, and eight burglary alarms. .(Numbers in parenthesis are included in total contact figures) [7 • AGENDA SECTION: ~ ~ 1 C~ ~ Q-~' I n AGENDA ITEM # REPORT # ~ I Z. STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 REPORT PREPARED BY: BETSY CxRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: S/GNATURE 1 REVIEWED BY CITY MANAGER: /~ _1 J~_~~ I , ~ ITEM FOR COUNCIL CONSIDERATION: ~~ Public hearing for consideration of the renewal of 2003 pawnbroker and secondhand goods ~ dealer licenses for Metro Pawn & Gun, Inc., 7529 L ndale Avenue South. L RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of pawnbroker and secondhand goods dealer licenses for Metro Pawn & Gun, Inc., 7529 Lyndale Avenue South. • II. BACKGROUND On October 22, 2002, the City received the renewal application and other required documents for pawnbroker and secondhand goods dealer licenses for Metro Pawn & Gun, Inc., 7529 Lyndale Avenue South. The applicant has paid the required license fees. The Public Safety background investigation has been completed and reveals the following: Mark Nichols is the owner of this establishment; James Thomas Blanche is the General manager; and John Alan Kunst is the acting Manager. None of these individuals has any known criminal record. 1210MetroPawnGunRenewalLicenses Mr. Nichols also owns Nichols Electronics, 1511 South Fourth Street in Minneapolis, MN, and he and his wife own Metro Pawn and Jewelry, 8820 Lyndale Avenue, . Bloomington, MN. A copy of the Articles of Incorporation has been provided and is on file with the City. The $1500 bond has been submitted. There were 15 Police and Fire contacts with Metro Pawn & Gun, Inc., from October 200.1 through September 2002. This compares with nine contacts for the previous year. A breakdown of these contacts is attached to this report. Environmental Health staff have received no complaints regarding Metro Pawn & Gun, Inc. The owner of the business continues to act in a cooperative manner with the Public Safety Department on the recovery of stolen articles. The notice of public hearing was published in the Sun Current newspaper on November 21, 2002. III. BASIS OF RECONIl~~NDATION A, POLICY • The applicant has complied with all of the provisions of the City codes pertaining to pawnbroker and secondhand goods dealer licensing. • • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the issuance of the licenses requested. B. CRITICAL ISSUES C. FINANCIAL • N/A D. LEGAL • N/A IV. ALTERNATNE RECONIlVIENDATION(S) ~ • The Council could decide to continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of a temporary license to-allow the applicant to continue the pawnbroker and secondhand goods dealer business until the rescheduled hearing can be conducted. I V . ATTACFIMENTS I • Breakdown of Public 5atety co • List of officers. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Mark Nichols, Owner • James Thomas Blanche, General Manager Metro Pawn & Gun, Inc. Officers Mark Nichols Owner James Thomas Blanche General Manager John Alan Kunst Store Manager • PUBLIC SAFETY CONTACTS October 2001 -September 2002 2001 2002. TOTAL CONTACTS 9 15 CRIMINAL CONTACTS 8 14 Incidents (see bottom of page for specifics) (2) (10) Alarm (6) (4) MISC. NON-CRIMINAL 1 1 Assists (1) (1) Traffic (0) (0) Inspections/Licensing (0) (0) Medical/Fire (0) (0) The criminal contacts from October 2001 through September 2002 were: one domestic, four suspicious persons, one theft, one suspicious activity, one welfare check, one property damage accident, one malicious mischief and four burglary alarms. (Numbers in parenthesis are included in total contact figures) r~ LJ • AGENDA SECTION: ~(,~ b 1 ~ Ci ~ f' ~~ ~ nG S AGENDA ITEM # ~ (V~ REPORT # ~ I , STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 REPORT PREPARED BY: BETSY CxRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, T/TLE DEPARTMENT DIRECTOR REVIEW: ~ ~ ~~ SIGNATURE REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 on-sale wine and 3.2 percent malt liquor licenses for Subeck, Incorporated, d/b/a Ketsana's Thai Restaurant, 7545 Lyndale Avenue South. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of on-sale wine and 3.2 percent malt liquor licenses for Subeck, Incorporated, d/b/a Ketsana's Thai Restaurant, 7545 Lyndale Avenue South. II. BACKGROUND On November 1, 2002, the City received the renewal application and other required documents for on-sale wine and 3.2 percent malt liquor licenses for Subeck Incorporated, d/b/a Ketsana's Thai Restaurant. The applicant has paid the required license fees. The Public Safety background investigation has been completed and reveals the following: 1210Ketsana's Renewal Liquor Licenses The corporate structure of the organization remains unchanged. Scott Bechtel and • Ketsana Bechtel are the owners of the establishment. Ketsana Bechtel continues to serve as the General Manager. Neither of these individuals has any known criminal history. The building and property continue to be owned by JSB Corporation, and the lease between the applicant and the landlord continues to be in effect with all payments current. All general real estate and withholding taxes have been paid and are current. The required proof of liquor liability insurance coverage has been received showing General Star Indemnity Insurance Company as affording the required coverage. Proof of workers' compensation insurance has also been supplied. An accountant's statement has been prepared and submitted. This statement covers the period from October 2001 through September 2002 and indicates that food sales accounted for 96.5% of the sales, while 3.2 percent malt liquor and on- sale wine sales accounted for 3.5% of the total sales. There was one Police contact with Ketsana's Thai Restaurant from October 2001 through September 2002. This compares with two contacts for the previous year. A breakdown of these contacts is attached to this report. • Environmental Health staff received two complaints in 2002 for Ketsana's Thai. Restaurant. The complaints were regarding long grass and weeds and garbage containers with no lids. Ketsana's was notified and no further complaints have been received. On-sale wine and 3.2 percent malt liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines discipline they can expect if any ongoing problems occur. A copy of this resolution has been given to the owner of the establishment. There are no distance requirements to notify neighbors of the issuance or renewal of an on-sale wine and 3.2 percent malt liquor licenses. The Notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. In March and July 1999, Ketsana's Thai Restaurant was cited for the sale of alcohol to underage youth. For their first offense, they paid a $500 fine and had their license to sell alcohol suspended for two days. For the second offense, they paid a $1500 fine and had their license to sell alcohol suspended for five days. They have received no further violations. • • III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to on-sale wine and 3.2 percent malt liquor licensing. • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the issuance of the license requested. B. CRITICAL ISSUES • The requirements in Resolution No. 9204 must be met. C. FINANCIAL • None D. LEGAL • None IV. ALTERNATIVE RECOMMENDATION(S~ • Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of license extensions to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. • Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers. Breakdown of Public Safety contacts. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Scott and Ketsana Bechtel, Owners of the establishment Ketsana's Thai Restaurant • Ketsana Bechtel Owner and Manager Scott Bechtel Owner POLICE & FIRE CONTACTS October 2001 -September 2002 2001 2002 TOTAL CONTACTS 2 1 CRIMINAL CONTACTS 2 1 Incidents (see bottom of page for specifics) (2) (1) Alarm (0) (0) MISC. NON-CRIMINAL 0 0 Assists (0) (0) Traffic (0) (0) • Inspections/Licensing (0) (0) Medical/Fire (0) (0) The criminal contact from October 2001 through September 2002 was: one theft. (Numbers in parenthesis are included in total contact figures) • • AGENDA SECTION: ~ ~ () C. I'K 0.f 1(~ Cj' s AGENDA ITEM #~j L REPORT # ~ I ~ ~- STAFF REPORT CITY COUNCIL MEETING • DECEMBER 10, 2002 REPORT PREPARED BY: BETSY CHRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: SIGNATURE REVIEWED BY CITY MANAGER: ~ ~~. , ,~ ~~ A. n ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 on-sale wine and 3.2 percent malt liquor licenses for Kiang's Red Pepper, Inc., d/b/a Red Pepper Chinese Restaurant, 2902 West 66th Street. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of on-sale wine and 3.2 percent malt liquor licenses for Kiang's Red Pepper, Inc., d/b/a Red Pepper Chinese Restaurant, 2902 West 66th Street. r~ U II. BACKGROUND On November 7, 2002, the City received the renewal application and other required documents for on-sale wine and 3.2 percent malt liquor licenses for Kiang's Red Pepper, Inc., d/b/a Red Pepper Chinese Restaurant, 2902 West 66th Street. The applicant has paid the required license fees. The Public Safety background investigation has been completed and reveals the following: 1210RedPepperRenewal Liquor Licenses The corporate structure of the organization remains unchanged. Ricky Kiang is • serving as President, Vice-President, Secretary and Treasurer. Mr. Kiang continues to serve as the General Manager of the restaurant. Mr. Kiang has no known criminal record. All general real estate taxes, state sales and withholding taxes have been paid and are current. The lease between the applicant and the property owner, Carlson Real Estate Company, continues to be in effect with all payments current. The required proof of liquor liability insurance and workers' compensation coverage has been received showing Truck Insurance Exchange as affording the required coverage. An accountant's statement has been prepared and submitted. This statement covers the period from October 2001 through September 2002 and indicates that food sales accounted for 99.18% of the total sales, while 3.2 percent malt liquor and on-sale wine sales accounted for .82% of the total sales. There were four Police and Fire contacts with Red Pepper from October 2001 through September 2002. This compares to eight contacts for the previous year. A breakdown of these contacts is attached to this report. • Environmental Health staff have received no complaints in 2002 regarding Red Pepper. On-sale wine and 3.2 percent malt liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines discipline they can expect if any ongoing problems occur. A copy of this resolution has been given to the owner of the establishment. There are no distance requirements to notify neighbors of the issuance or renewal of on-sale wine and 3.2 percent malt liquor licenses. The Notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. Red Pepper has received no violations for the sale of alcohol to underage youth. III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to on-sale wine and 3.2 percent malt liquor licensing. • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the issuance of the license requested. • B. CRITICAL ISSUES • The requirements in Resolution No. 9204 must be met: C. FINANCIAL • None D. LEGAL None IV. ALTERNATIVE RECOMMENDATION(S~ • Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of a license extension to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. • Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers. • Breakdown of Public Safety Contacts. VI. PRINCIPAL PARTIES EXPECTED AT MEETING Ricky Kiang, Owner of the establishment • Kiang's Red Pepper Inc. Red Pepper Chinese Restaurant Directors and Officers Ricky Kiang President, Vice-President, Secretary and Treasurer POLICE &FIRE-CONTACTS October 2001 through- September 2002 2001 2001 TOTAL CONTACTS $ 4 CRIMINAL CONTACTS 5 3 Incidents (see bottom of page for specifics) (4) (2) Alarm (1) (1) MISC. NON-CRIMINAL 3 1 Assists (0) (0) Traffic (2) (0) Inspections/Licensing (0) (0) Medical/Fire (1) (1) The criminal contacts from October 2001 through September 2002 were: one burglary alarm, one vandalism, and one property damage hit and run accident. (Numbers in parenthesis are included in total contact figures) • AGENDA SECTION: 1 U,V~ ~ G ~}ec.~~~ nq 5 AGENDA ITEM # ~K REPORT # 3 ~ q STAFF REPORT CITY COUNCIL MEETING • DECEMBER 10, 2002 BETSY CHRISTENSEN, ADMINISTRATNE REPORT PREPARED BY: SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME. TITLE DEPARTMENT DIRECTOR REVIEW: ~~w 1 [n'IT SIGNATURE REVIEWED BY CITY MANAGER: ~ ~ _-. ~ ^~~~_~ ~ ~~~, ~ ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 on-sale wine and 3.2 percent malt liquor licenses for Thompson's Fireside Pizza, Inc., d/b/a Fireside Pizza, 6736 Penn Avenue South. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of on-sale wine and 3.2 percent malt liquor licenses for Thompson's Fireside Pizza, Inc., d/b/a Fireside Pizza, 6736 Penn Avenue South. II BACKGROUND I On November 7, 2002, the City received the renewal application and other required documents for on-sale wine and 3.2 percent malt liquor licenses for Thompson's Fireside Pizza, Inc. d/b/a Fireside Pizza, 6736 Penn Avenue South. The applicant has paid the required license fees. • The Public Safety background investigation has been completed and reveals the following: 1210FiresidePizzaRenewal Liquor Licenses The corporate structure of the organization remains unchanged. Richard Bruce Thompson continues to serve as President, and Richard Orville Thompson serves as Vice-President. Michelle Thompson serves as Secretary and Treasurer. Richard Bruce Thompson continues to serve as General Manager of the restaurant. None of these individuals has any known criminal record. All general real estate taxes, state sales and withholding taxes have, been paid and are current. Proof of liquor liability insurance will be provided as soon as possible. Proof of workers' compensation insurance has been submitted. An accountant's statement has been prepared and submitted. This statement covers the period from October 2001 through September 2002 and indicates that food sales accounted for 93% of the total sales, while 3.2 percent malt liquor and on-sale wine sales accounted for 7% of the total sales. There were eight Police and Fire contacts with Thompson's Fireside Pizza, Inc. from October 2001 through September 2002. This compares with four contacts for the previous year. A breakdown of these contacts is attached to this report. Environmental Health staff received no complaints regarding Thompson's Fireside Pizza in 2002. On-sale wine and 3.2 percent malt liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines discipline they can expect if any ongoing problems occur. A copy of this resolution has been given to the owner of the establishment. There are no distance requirements to notify neighbors of the issuance or renewal of on-sale wine and 3.2 percent malt liquor licenses. The Notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. Thompson's Fireside Pizza has received no violations for the sale of alcohol to underage youth. III. BASIS OF RECOMMENDATION ~ A. POLICY The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to on-sale wine and 3.2 percent malt liquor licensing. Based on the information supplied by the applicant and the • investigation conducted, there appears to be no reason to deny the issuance of the license requested. . B. CRITICAL ISSUES Proof of liquor liability insurance must be submitted. The requirements in Resolution No. 9204 must be met. C. FINANCIAL None D. LEGAL None IV. ALTERNATIVE RECOMMENDATION(S~ Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of license extensions to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS I List of Officers. Breakdown of Public Safety contacts. VI PRINCIPAL PARTIES EXPECTED AT MEETING Bruce and Michelle Thompson, Owners of the establishment Thompson's Fireside Pizza, Inc. Fireside Pizza Directors and Officers Richard B. Thompson President Richard O. Thompson Vice-President Michelle Thompson Secretary and Treasurer Richard B. Thompson -General Manager POLICE & FIRE CONTACTS October 2001 through September 2002 U 2001 2001 TOTAL CONTACTS 4 $ CRIMINAL CONTACTS 4 5 Incidents (see bottom of page for specifics) (4) (5) Alarm (0) (0) MISC. NON-CRIMINAL 0 3 Assists (0) (1) Traffic (0) (0) Inspections/Licensing (0) (1) Medical/Fire (0) (1) The criminal contacts from October 2001 through September 2002 were: one vandalism, one suspicious activity, one malicious mischief, one suspicious person, and one miscellaneous city ordinance violation. (Numbers in parenthesis are included in total contact figures) • • AGENDA SECTION: AGENDA ITEM # REPORT # ~. STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 Pu1~~iG i-Eearrngs 5J ~~~ REPORT PREPARED BY: BETSY CHRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: ® '~ ~~ SIGNATURE REVIEWED BY CITY MANAGER: ~ '~~ , ~ `~ j n ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 club on-sale and Sunday liquor licenses for Minnea olis-Richfield American Le ion Post 435, 6501 Portland Avenue South. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of club on-sale and Sunday liquor licenses for Minneapolis- Richfield American Legion Post 435, 6501 Portland Avenue South. • II. BACKGROUND On November 13, 2002, the City received the application and other required documents for the renewal of the club on-sale and Sunday liquor licenses for Minneapolis-Richfield American Legion Post 435, 6501 Portland Avenue South. The applicant has paid the required license fees. The Public Safety background investigation has been completed and reveals the following: The structure of the organization has changed from last year. George Karnas now serves as President. James Morris serves as Vice-President; and James Munson serves as Treasurer. Roger Wysong continues to serve as the Club Manager. 1210LegionRenewal Liquor Licenses None of these individuals has any known criminal record. A current list of officers is • attached. All general real estate and withholding taxes have been paid and are current. The property and building continue to be owned by the American Legion. The $10,000 bond will be submitted as soon as possible. The required proof of liquor liability insurance has been submitted showing Insurance Corporation of Hanover affording the coverage. Workers' compensation insurance coverage has also been submitted. An accountant's statement has been prepared and submitted. This statement covers the period from October 2001 through September 2002 and indicates that food sales accounted for 27% of the total sales while liquor sales accounted for 73% of the total sales. There were 53 Police and Fire contacts with the American Legion from October 2001 through September 2002. This compares with 31 contacts for the previous year. A breakdown of these contacts is attached to this report. There were no Environmental Health complaints received for the Mpls-Richfield . American Legion Post #435 during this past year. Club on-sale and Sunday liquor licenses require owners of these establishments to comply with resolution No. 9204, which outlines the discipline they can expect if any ongoing problems occur. A copy of this resolution has been given to the owner of the establishment. There are no distance requirements to notify neighbors of the issuance or renewal of a club on-sale and Sunday liquor license. The Notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. In July 1999, the Richfield American Legion was cited for the sale of alcohol to underage youth. This was their first violation. They paid a $500 fine and had their license to sell alcohol suspended for two days. In April 2002, The Mpls-Richfield American Legion Post #435 was again cited for the sale of alcohol to underage youth. This was technically their second violation, but because more than two years had elapsed since the previous failure, it served as a first failure. They paid a $500 fine and had their license to sell alcohol suspended for two days. • III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to club on-sale and Sunday liquor licensing. • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the issuance of the license requested. B. CRITICAL ISSUES • Receipt of the $10,000 bond. • The requirements of Resolution No. 9204 must be met. C. FINANCIAL • None D. LEGAL • None . IV. ALTERNATIVE RECOMMENDATION(S~ • Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the council should consider the granting of license extensions to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers Breakdown of Police & Fire contacts. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • American Legion club officer • Mpls -Richfield American Legion • George Karnas President James Morris Vice-President James Munson Treasurer Roger Wysong Club Manager POLICE & FIRE CONTACTS. October 2001 -September 2002 • 2001 2002 TOTAL CONTACTS 31 53 CRIMINAL CONTACTS 25 45 Incidents (see bottom of page for specifics) (19) (28) Alarm (6) (17) MISC. NON-CRIMINAL 6 8 Assists (2) (1) Traffic (0) (1) Inspections/Licensing (1) (1) Medical/Fire (3) (5) The criminal contacts from October 2001 through September 2002 were: one suspicious activity, one suspicious person, one assault, seven drunkeness', five disturbances, seventeen burglary alarms, one suspicious vehicle, one vandalism, one welfare check, one miscellaneous city ordinance violation, five thefts, three property damage hit and run accidents, and one DWI. (Numbers in parenthesis are included in total contact figures) • • n U AGENDA SECTION: AGENDA ITEM # REPORT # r STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 ~~,~, ~ I i G!-h~Qf'' i n CI $ 5 ~ J 3O7 REPORT PREPARED BY: BETSY CxRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: ~, n ~ u SIGNATURE REVIEWED BY CITY MANAGER: ~~~ ~a __~~ /, ('~ ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 club on-sale and Sunday liquor licenses for Fred Babcock V.F.W. Post No. 5555, Inc., d/b/a Four Nickels Food and Drink, 6715 lake Shore Drive. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of club on-sale and Sunday liquor licenses for Fred Babcock V.F.W. Post No. 5555, Inc., d/b/a Four Nickels Food and Drink, 6715 Lake Shore Drive. • II. BACKGROUND On October 18, 2002, the City received the renewal application and other required documents for club on-sale and Sunday liquor licenses for Fred Babcock V.F.W. Post No.5555, Inc., d/b/a Four Nickels Food and Drink. The Public Safety background investigation has been completed and reveals the following: The corporate structure of the organization has changed from the previous year. Walt Fix now serves as Commander; Lowell Turner serves as Sr. Vice Commander; 1210VFWRenewal Liquor Licenses and Gerald Hager serves as Quartermaster. The on-premise manager is Gin Ng. None of these individuals has any known criminal record. A current list of officers is attached. All general real estate and withholding taxes have been paid and are current. The property is owned by Gramarcy Park Cooperative. The $10,0000 bond issued by Old Republic Surety Company has been submitted. The required proof of liquor liability insurance coverage has been received showing TIG Insurance as affording the required coverage. Proof of workers' compensation insurance coverage has also been supplied. An accountant's statement has been submitted covering the period October 2001 through September 2002 and indicates that food sales accounted for 50% of the total sales, while alcohol accounted for 48.9% of the total sales. Miscellaneous sales accounted for 1.1 % of the total sales. There were nine Police and Fire contacts with Fred Babcock V.F.W. Post No.5555 from October 2001 through September 2002. This compares with seventeen contacts for the previous year. A breakdown of these contacts is attached to this report. Environmental Health staff have received no complaints regarding the V.F.W. in 2002. Club on-sale and Sunday liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines discipline they can expect if any ongoing problems occur. A copy has been given to the establishment. There are no distance requirements for notifying neighbors of the issuance or renewal of a club on-sale and Sunday liquor license. The Notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. In July 1999, Fred Babcock V.F.W. Post No. 5555 was cited for the sale of alcohol to underage youth. This was their first violation. They paid a $500 fine and had their license to sell alcohol suspended for two days. They were also cited in August 2000. This was their second violation. They paid a $1500 fine and had their license to sell alcohol suspended for five days. Fred Babcock V.F.W. Post No. 5555 has received no violations in the years 2001 or 2002. • III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to club on-sale and Sunday liquor licensing. • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the issuance of the license requested. B. CRITICAL ISSUES • The requirements of Resolution No. 9204 must be met. C. FINANCIAL • N/A D. LEGAL • N/A IV. ALTERNATNE RECOMMENDATION(S~ • Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of license extension to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. • Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers. Breakdown of Public Safety contacts. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Gin Ng, Manager of establishment n v.F.w. 2002 Post Officers Walt Fix Commander Lowell Turner Sr. Vice Commander .Gerald Hager Quartermaster Gin Ng On-premise Manager POLICE & FIRE CONTACTS October 2001 -September 2002 2001 2002 TOTAL CONTACTS 17 9 CRIMINAL CONTACTS 11 7 Incidents (see bottom of page for specifics) (5) (7) Alarm (6) (0) MISC. NON-CRIMINAL 6 2 Assists (1) (0) Traffic (0) (0) Inspections/Licensing (2) (1) Medical/Fire (3) (1) The criminal contacts from October 2001 through September 2002 were: one robbery, one noise complaint, two disturbances, one drunkenness, one burglary, and one follow-up investigation. (Numbers in parenthesis are included in total contact figures) • AGENDA SECTION: ~~' - G ~,Y'+I r1 A S AGENDA ITEM # `j REPORT# 3O(~ STAFF REPORT CITY COUNCIL MEETING • DECEMBER 10, 2002 REPORT PREPARED BY: BETSY CxRISTENSEN, SUPPORT SERVICES DIVISION MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: SIGNATURE REVIEWED BY CITY MANAGER: .~C ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 on-sale intoxicating and Sunday liquor licenses for Taco Morelos II, Inc., 2 West 66th Street. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of on-sale intoxicating and Sunday liquor licenses for Taco Morelos 11, Inc., 2 West 66th Street. II. BACKGROUND On November 15, 2002, the City received the renewal application and other required documents for the on-sale intoxicating and Sunday liquor licenses for Taco Morelos II, Inc. The applicant has paid the required licensing fees. The Public Safety background investigation has been completed and reveals the following: The corporate structure of the organization has remained unchanged from their original application in July 2002. Gaspar Rey Perez is the President of the organization and Lucila Sanchez Perez serves as the Secretary. The on-premises manager is Lorenzo Ariza. Gaspar Perez's criminal history check revealed 1210 Taco Morelos Renewal Liquor Licenses instances of activity and were previously highlighted for the City Council when they approved the establishment's alcohol license in July 2002.. Lucila Sanchez-Perez and Lorenzo Ariza have no known criminal record. The property being leased by Taco Morelos II, Inc. is owned by Heritage Property I.T. Inc. The lease between the applicant and the landlord are in effect with all payments current. The $10,000 bond issued by Old Republic Surety has been submitted. The required proof of liquor liability insurance coverage has been received showing State Auto Insurance Companies as affording the required coverage. Proof of workers' compensation insurance has also been supplied. An accountant's statement has been prepared and submitted. This statement covers the period from September 1, 2002 through October 31, 2002 and indicates that food sales accounted for 96% of the total sales, while liquor sales accounted for 4% for the total sales. The accountant's statement covered this two-month period only, as the applicant did not start serving alcohol until September 2002. Environmental Health staff received one complaint for Taco Morelos in the past year. The complaint was regarding afood-related matter. The Bloomington Health Department was notified and no further complaints have been received. There were no Police or Fire contacts with Taco Morelos in the past year. This compares with one contact for the previous year. On-sale intoxicating and Sunday liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines the discipline they can expect if any ongoing problems occur. A copy of this resolution has been given to the owner of the establishment. There are no distance requirements in which to notify neighbors of the issuance of on-sale intoxicating and Sunday liquor licenses for either the state or the City. The notice of public hearing was published in the Richfield Sun Current on November 21, 2002. III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to on-sale intoxicating and Sunday liquor licensing. . B. CRITICAL ISSUES • That the requirements are met in Resolution No. 9204. • C. FINANCIAL • N/A D. LEGAL • N/A IV. ALTERNATIVE RECOMMENDATION(S~ • Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of license extension to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. • Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers. • Breakdown of Public Safety contacts. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Gaspar Perez, Owner • Lorenzo Ariza, Manager • Taco Morelos • Officers and Directors Gaspar Rey Perez President Lucila Sanchez Perez Secretary Lorenzo Ariza On-Premise Manager POLICE & FIRE CONTACTS October 2001 -September 2002 • 2001 2002 TOTAL CONTACTS (1) (0) CRIMINAL CONTACTS (1) (0) Incidents (see bottom of page for specifics) (1) (0) Alarm (0) (0) MISC. NON-CRIMINAL (0) (0) Assists (0) (0) Traffic (0) (0) Inspections/Licensing (0) (0) Medical/Fire (0) (0) The criminal contacts from October 2001 through September 2002 were: None (Numbers in parenthesis are included in total contact figures) • AGENDA SECTION: P~ I i C~ ~~(~t.l'~ ~ 17Gt S AGENDA ITEM # tj ~ J REPORT # ~ ('~ STAFF REPORT CITY COUNCIL MEETING DECEMBER 1~, 2U~2 REPORT PREPARED BY: BETSY CxRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DEPARTMENT DIRECTOR REVIEW: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE ,~ SIGNATURE REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 on-sale intoxicating and Sunday liquor licenses for The Ground Round Inc., d/b/a The Ground Round, 1500 East 78th Street. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of on-sale intoxicating and Sunday liquor licenses for The Ground Round Inc., d/b/a The Ground Round, 1500 East 78th Street. II. BACKGROUND On October 23, 2002, the City received the renewal application and other required documents for the on-sale intoxicating and Sunday liquor licenses for the Ground Round Inc., d/b/a The Ground Round. The applicant has paid the required fees. The Public Safety background investigation has been completed and reveals the following: The corporate structure of the organization has changed from last year. Thomas J. Russo serves as President; Warren Hutchins serves as Vice President and Secretary; and Brian Connell serves as Treasurer. Jerome Robert Eck now serves 1210GroundRoundRenewalLiquorLicenses as the on premise manager. None of these individuals has any known criminal record. A current list of officers is attached. The lease between the applicant and the property owner, A.G. Bogen Company, is in effect with all payments current. The $10,000 bond issued by American Manufacturers Mutual Insurance Company has been submitted. The required proof of liquor liability insurance coverage has been received showing Royal Indemnity Insurance Co. of America as affording the required coverage. Proof of workers' compensation insurance has also been submitted. A financial statement has been prepared and submitted. This statement covers the period from October 2001 through September 2002 and indicates that food sales accounted for 62% of the total sales, while liquor sales accounted for 38% of the total sales. There were 23 Police and Fire contacts with The Ground Round from October 2001 through September 2002. This compares with 33 contacts for the previous year. A breakdown of these contacts is attached to this report. Environmental Health staff have received no complaints regarding The Ground Round in 2002. On-sale intoxicating and Sunday liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines discipline they can expect if any ongoing problems occur. A copy of this resolution has been given to the owner of the establishment. There are no distance requirements to notify neighbors of the issuance or renewal of an on-sale intoxicating and Sunday liquor license. The notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. In March 1999, The Ground Round was cited for the sale of alcohol to underage youth. This was their first violation. They paid a $500 fine and had their license to sell alcohol suspended for two days. They have not been cited for the sale of alcohol to underage youth in the years 2000, 2001 and 2002. • i III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to on-sale intoxicating and Sunday liquor licensing. • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the issuance of the license requested. B. CRITICAL ISSUES • The requirements of Resolution No. 9204 must be met. C. FINANCIAL • N/A D. LEGAL • N/A IV. ALTERNATIVE RECOMMENDATION(S~ . Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of license extensions to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. • Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers. • Breakdown of Public Safety contacts. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • The Ground Round staff. • THE GROUND ROUND Officers and Directors Thomas Russo President Warren Hutchins Vice President & Secretary Brian Connell Treasurer Jerome Eck On Premise Manager POLICE & FIRE CONTACTS October 2001 through September 2002 • 2001 2002 TOTAL CONTACTS 33 23 CRIMINAL CONTACTS 26 16 Incidents (see bottom of page for specifics) (24) (15) Alarm (2) (1) MISC. NON-CRIMINAL 7 7 Assists (3) (2) Traffic (3) (1) Inspections/Licensing (0) (2) Medical/Fire (1) (2) The criminal contacts from October 2001 through September 2002 were: five thefts, two disturbances, one suspicious person, one burglary alarm, two dru nkenness, two detox commitments, one assault, one malicious mischief, and one suspicious activity. (Numbers in parenthesis are included in total contact figures) • AGENDA SECTION: 1" uI'I ~ ~ l-~ ec~ - n q s AGENDA ITEM #rJ' REPORT # 'j Q'{ ICJ r STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 REPORT PREPARED BY: BETSY CxRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: Q~ s SIGNATURE REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 on-sale intoxicating and Sunday liquor licenses for Paisan Inc., d/b/a Khan's Mon olian Barbe ue, 500 East 78th Street. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of on-sale intoxicating and Sunday liquor licenses for Paisan Inc., d/b/a Khan's Mongolian Barbeque, 500 East 78th Street. II. BACKGROUND On October 18, 2002, the City received the renewal application and other required documents for the on-sale intoxicating and Sunday liquor licenses for Paisan Inc., d/b/a Khan's Mongolian Barbeque. The applicant has paid the required fees. The Public Safety background investigation has been completed and reveals the following: • The corporate structure of the organization remains unchanged from last year. Mitchell Law and Sherri (Paisan) Law are sole owners of the restaurant. Mitchell Law continues to serve as the General manger of the restaurant. Neither of these individuals has any known criminal record. 1210KhansRenewal Liquor Licenses The lease between the applicant and the property owner, Roy A. Bogen, is in effect with all payments current. All general sales, real estate and withholding taxes have been paid and are current. The $10,000 Bond has been received showing Old Republic Surety Company affording the coverage. The required proof of liquor liability insurance will be submitted as soon as possible. Proof of workers' compensation has been supplied. An accountant's statement has been prepared and submitted. This statement covers the period from October 2001 through September 2002 and indicates that food sales accounted for 94% of the total sales, while liquor sales accounted for 6% of the total sales. There were twelve Police and Fire contacts with Khan's from October 2001 through September 2002. This compares with nine contacts for the previous year. A breakdown of these contacts is attached to this report. Environmental Health staff received no complaints this past year regarding Khan's Mongolian Barbeque. • On-sale and Sunday liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines. discipline they can expect if any ongoing problems occur. A copy of this resolution has been given to the owner of the establishment. There are no distance requirements in which to notify neighbors of the issuance or renewal of on-sale and Sunday liquor licenses. The Notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. In July 1999, Khan's Mongolian Barbeque was cited for the sale of alcohol to underage youth. They paid a $500 fine and had their license to sell alcohol suspended for two days for their first violation. In July 2001, Khan's .Mongolian Barbeque was cited for their second violation. Since this second violation occurred just two days prior to the two-year time frame established in resolution no. 8808, the owner of the establishment requested that the violation be considered a first violation with the agreement that the fees and suspension period remain that of a second violation. Council approved the request and Khan's Mongolian Barbeque received a $1500 fine and had their license to sell alcohol suspended for five days. Khan's Mongolian Barbeque has received no violations in 2002. • III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to on-sale intoxicating and Sunday liquor licensing. • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the issuance of the license requested. B. CRITICAL ISSUES • Proof of liquor liability insurance must be submitted. • The requirements of Resolution No. 9204 must be met. C. FINANCIAL • N/A D. LEGAL • N/A • IV. ALTERNATIVE RECOMMENDATION(S~ • Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of license extensions to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. • Suspend or revoke the licenses.. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers. Breakdown of Public Safety contacts. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Mitchell Law • • KHAN'S MONGOLIAN BARBEQUE Officer and Directors Mitchel Law Sherri (Paisan) Law President Vice President POLICE & FIRE CONTACTS October 2001 -September 2002 2001 2002 TOTAL CONTACTS 9 12 CRIMINAL CONTACTS 8 11 Incidents (see bottom of page for specifics) (4) (6) Alarm (4) (5) MISC. NON-CRIMINAL 1 1 Assists (0) (0) Traffic (1) (1) Inspections/Licensing (0) (0) Medical/Fire (0) (0) The criminal contacts from October 2001 through September 2002 were: one received stolen property, two follow-up investigations, one theft, five burglary alarms, one vandalism, and one miscellaneous City ordinance violation. (Numbers in parenthesis are included in total contact figures) • • AGENDA SECTION: ~~ I l C~ t~ ~ n q S AGENDA ITEM # REPORT # ~O J STAFF REPORT CITY COUNCIL MEETING • DECEMBER 10, 2002 REPORT PREPARED BY: BETSY CHRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: ~ .~}~ CA l` SIGNATURE REVIEWED BY CITY MANAGER: ~~!~ ~Lt_~ /, n ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of on-sale intoxicating and Sunday liquor licenses for 2003 for Champps Operating Corporation d/b/a Champps Restaurant, 790 West 66th Street. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of on-sale intoxicating and Sunday liquor licenses for Champps Operating Corporation d/b/a Champps Restaurant, 790 West 66th Street. II. BACKGROUND On November 4, 2002, the City received the renewal application and other required documents for on-sale intoxicating and Sunday liquor licenses for Champps Operating Corporation d/b/a Champps Restaurant. The applicant has paid the required fees. The Public Safety background investigation has been completed and reveals the following: 1210ChamppsRenewalLiquorLicenses The corporate structure of the organization has changed from last year. William • Baumhauer still serves as President and CEO; Donna- Depoian serves as Vice- . President and Secretary; and Frederick Dreibholz serves as Vice-President and Treasurer. Darren Thorson now serves as the on-premise manager. None of these individuals has any known criminal record. A current list of officers is attached. All general sales, real estate and withholding taxes have been paid and are current. The lease between the applicant and the property owner, Market Plaza Commercial, LTD., is in effect with all payments current. The $10,000 bond issued by National Fire Insurance Company of Hartford has been submitted. The required proof of liquor liability insurance coverage has been received showing Travelers Indemnity Company of Illinois affording the required coverage. Proof of workers' compensation insurance coverage has also been supplied. An accountant's statement has been prepared and submitted. This statement covers the period from October 2001 through September 2002 and indicates that food sales accounted for 67% of the total sales, while liquor sales accounted for 33% of the total sales. • There were 30 Public Safety Police and the Fire Department contacts with Champps restaurant from October 2001 through September 2002. This compares with 57 contacts for the previous year. A breakdown of these contacts is attached to this report. Environmental Health staff received one complaint this past year regarding Champps. The complaint involved grease on the dock. Duane Hudson from the Bloomington Health Department and Champps were notified and staff received no further complaints. On-sale intoxicating and Sunday Liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines discipline they can expect if any ongoing problems occur. A copy of this resolution has been given to the owner of the establishment. There are no distance requirements to notify neighbors of the issuance or renewal of an on-sale intoxicating and Sunday liquor licenses. The Notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. In July 1999 and November 1999, Champps Restaurant was cited for the sale of alcohol to underage youth. They paid a $500 fine and had their license to sell alcohol suspended for two days for their first violation. For their second violation, they received a $1500 fine and had their license to sell alcohol suspended for five days. They did not receive any violations in the years 2000 or 2001. In April of 2002, Champps received a third violation for the sale of alcohol to underage youth. due to the fact that the alcohol discipline resolution 8808 was rescinded after their violation and resolution 9204 was in place at the time they appeared before the City Council. The licensee did, however, receive a fine of $1750 and had their license to sell alcohol suspended for ten days, as is the penalty for third time violators. III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City ..Codes and State Statutes pertaining to on-sale intoxicating and Sunday liquor licensing. • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the issuance of the licenses requested. B. CRITICAL ISSUES • The requirements of Resolution No. 9204 must be met. C. FINANCIAL • N/A • D. LEGAL • N/A IV. ALTERNATIVE RECOMMENDATION(S~ • Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of license extensions to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. • Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers • Breakdown of Public Safety contacts VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Champps staff Champps Operating Corporation Champps Restaurant Officers and Directors William Henry Baumhauer President Donna Louise Depoian Vice-President & Secretary Frederick Jon Dreibholz Vice-President& Treasurer Darren Thorson On-Premise Manager POLICE & FIRE CONTACTS October 2001 -September 2002 • 2001 2002 TOTAL CONTACTS 57 30 CRIMINAL CONTACTS 44 24 Incidents (see bottom of page for specifics) (33) (13) Alarm (11) (11) MISC. NON-CRIMINAL 13 6 Assists (3) (2) Traffic (2) (0) Inspections/Licensing (6) (2) Medical/Fire (2) (2) The criminal contacts from October 2001 through September 2002 were: one disturbance, two property damage accidents, two thefts, eleven burglary alarms, four drunkenness', one vandalism, one 911 hang-up, one warrant arrest, and one miscellaneous City ordinance violation. (Numbers in parenthesis are included in total contact figures) • • AGENDA SECTION: Pub ~ 1 [, ~'t eu~ Il1C.~5 AGENDA ITEM # REPORT # 3~n~2. STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 • REPORT PREPARED BY: BETSY CxRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, T/TLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: ^ _ 4.V~ ~~O SIGNATURE REVIEWED BY CITY MANAGER: ~~ ~ _ ~Ld~ ~_ n ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 on-sale intoxicating and Sunday liquor licenses for Don Pablo's O eratin Cor oration d/b/a Don Pablos, 980 West 78th Street. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of on-sale intoxicating and Sunday liquor licenses for Don Pablo's Operating Corporation d/b/a Don Pablos, 980 West 78th Street. • II. BACKGROUND On October 23, 2002, the City received the renewal application and other required documents for the on-sale intoxicating and Sunday liquor licenses for Don Pablo's Operating Corporation d/b/a Don Pablos. The applicant has paid the required fees. The Public Safety background investigation has been completed and reveals the following: The corporate structure of the organization has changed from last year. Robert Andreottola continues to serve as CEO; Margaret Waldrep serves as President and Treasurer; and Percy Williams II serves as Vice-President and Secretary. Michael 1211 DonPablo's Renewal Liquor Licenses J. Olander is now serving as the on-premise manager.. None of these individuals • has any known criminal record. A current list of officers is attached. All general sales, real estate and withholding taxes have been paid and are current. The lease between the applicant and the property owner, CSM Investors, Inc. is in effect with all payments current. The $10,000 bond issued by Great American Insurance Company has been submitted. The required proof of liquor liability insurance coverage has been received showing American Manufacturers Mutual Insurance Company affording the required coverage. Proof of workers' compensation insurance coverage has also been supplied. An accountant's statement has been prepared and submitted. This statement covers the period from October 2001 through September 2002 and indicates that food sales accounted for 78% of the total sales, while liquor sales accounted for 22% of the total sales. There were 21 Police and Fire contacts with Don Pablos from October 2001 through September 2002. This compares with 48 contacts for the previous year. A . breakdown of these contacts is attached to this report. Environmental Health staff received one complaint regarding Don Pablos during the past year. The complaint was regarding health-related issues. Doug Deyer from the Bloomington Health Department and Don Pablo's were notified and no further complaints have been received. On-sale intoxicating and Sunday liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines discipline they can expect if any ongoing problems occur. A copy of this Resolution has been given to the owner of the establishment. There are no distance requirements to notify neighbors of the issuance or renewal of on-sale intoxicating and Sunday liquor licenses. The Notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. In July 1999, Don Pablos was cited for the sale of alcohol to underage youth. They paid a $500 fine and had their license to sell alcohol suspended for two days. They received a second violation in October 2000. They received a $1500 one and had their license to sell alcohol suspended for five days. Don Pablo's has received no • violations in the years 2001 and 2002. i III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to on-sale intoxicating and Sunday liquor licenses. • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the issuance of the licenses requested. B. CRITICAL ISSUES • The requirements of Resolution No. 9204 must be met. C. FINANCIAL • N/A D. LEGAL • N/A IV. ALTERNATIVE RECOMMENDATION(S~ • Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of license extensions to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. • Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers. Breakdown of Public Safety contacts. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Don Pablos staff. • Don Pablo's Operating Corporation • Don Pablos Officers and Directors Robert Andreottola CEO Margaret Waldrep President and Treasurer Percy Williams II Vice-President and Secretary Michael Olander On-Premise Manager POLICE & FIRE CONTACTS October 2001 -September 2002 • 2001 2002 TOTAL CONTACTS 48 21 CRIMINAL CONTACTS 43 18 Incidents (see bottom of page for specifics) (25) (8) Alarm (18) (10) MISC. NON-CRIMINAL 5 3 Assists (3) (2) Traffic (2) (0) Inspections/Licensing (0) (0) Medical/Fire (0) (1) The criminal contacts from October 2001 through September 2002 were: two thefts, nine burglary alarms, one fire alarm, one suspicious person, three drunkenness, one suspicious vehicle, and one noise complaint. (Numbers in parenthesis are included in total contact figures) • AGENDA SECTION: ~ iG I I'1('j S AGENDA ITEM # ,]~ ~~ REPORT # ~Q I J STAFF REPORT CITY COUNCIL MEETING • DECEMBER 10, 2002 REPORT PREPARED BY: BETSY CxtuSTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT,- DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: ® ~,J~ SIGNATURE REVIEWED BY CITY MANAGER: ~' '~, ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 on-sale intoxicating and Sunday liquor !, licenses, including the outside service of alcohol, for Wiltshire Restaurants, LLC d/b/a !, Houlihan's Restaurant & Bar, 6601 L ndale Avenue South. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of on-sale intoxicating and Sunday liquor licenses, including the outside service of alcohol, for Wiltshire Restaurants, LLC d/b/a Houlihan's Restaurant & Bar, 6601 Lyndale Avenue South. • II. BACKGROUND On October 29, 2002, the City received the renewal application and other required documents for the on-sale intoxicating and Sunday liquor licenses for Wiltshire Restaurants, LLC d/b/a Houlihan's Restaurant & Bar. The applicant has paid the required fees. The Public Safety background investigation has been completed and reveals the following: 1211 HoulihansRenewal Liquor Licenses The corporate structure of the organization remains unchanged from the previous year. Lucius Fowler is the President of the organization. Joseph L. Martin serves as the Secretary and Treasurer. The on-premises manager is Kim Zeigler. None of these individuals has any known criminal record. A current list of officers is attached. The property being leased by Houlihan's Restaurant & Bar is owned by Richfield State Agency, Inc. The lease between the applicant and the landlord are in effect with all payments current. The $10,000 bond issued by Travelers Casualty and Surety Company of America has been submitted. A financial statement has been prepared and submitted. This statement covers the period from October 2001 through September 2002 and indicates that food sales accounted for 67.8% of the total sales, while liquor sales accounted for 32.2% of the total sales. The required proof of liquor liability insurance coverage has been received showing Lexington Insurance Company as affording the required coverage. Proof of workers' compensation insurance coverage has also been supplied. The Environmental Health staff have received no complaints for Houlihan's Restaurant & Bar in 2002. There were 24 Police and Fire contacts with Houlihan's Restaurant & Bar in 2002. This compares with 15 contacts for the previous year. A breakdown of these contacts is attached to this report. On-sale intoxicating and Sunday liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines discipline they can expect if any ongoing problems occur. A copy of this resolution has been given to the owner of the establishment. There are no distance requirements to notify neighbors of the issuance of an on- sale intoxicating and Sunday liquor licenses. The Notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. In July 2001, Houlihan's Restaurant & Bar was cited for the sale of alcohol to underage youth. This was their first violation. They paid a $500 fine and had their license to sell alcohol suspended for two days. Houlihan's Restaurant & Bar has received no violations in 2002. • • III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to on-sale intoxicating and Sunday liquor licensing. • Based upon the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the licenses requested. B. CRITICAL ISSUES • The requirements in Resolution No. 9204 must be met. C. FINANCIAL • N/A D. LEGAL • N/A IV. ALTERNATIVE RECOMMENDATION(S~ • • Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of a license extension to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers. • Breakdown of Public Safety contacts. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Houlihans Staff • Houlihan's Restaurant & Bar Officers Lucius Ludlow Fowler President Joseph L. Martin Secretary & Treasurer Kim Richard Zeigler On-Premises Manager POLICE & FIRE CONTACTS October 2001 through September 2002 • 2001 2002 TOTAL CONTACTS 15 24 CRIMINAL CONTACTS 11 22 Incidents (see bottom of page for specifics) (10) (17) Alarm (1) (5) MISC. NON-CRIMINAL 4 2 Assists (0) (1) Traffic (1) (0) Inspections/Licensing (1) (1) Medical/Fire (2) (0) The criminal contacts from October 2001 through September 2002 were: two thefts, one burglary alarm, two disturbances, five suspicious persons, one follow-up investigation, four fire alarms, one disorderly conduct, two property damage hit and run accidents, one suspicious vehicle, two harassments, and one malicious mischief. (Numbers in parenthesis are included in total contact figures) • AGENDA SECTION: P I G j AGENDA ITEM # REPORT # ~C1 C3 STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 C] REPORT PREPARED BY: BETSY CHRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, T/TLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: ® ~` -_ W SIGNATURE REVIEWED BY CITY MANAGER: ~ - ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of on-sale intoxicating and Sunday liquor licenses for The Frenchmans, 1400 East 66th Street. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of on-sale intoxicating and Sunday liquor licenses for The Frenchmans, 1400 East 66th Street. II. BACKGROUND On November 4, 2002, the City received a new application and other required documents for on-sale intoxicating and Sunday liquor licenses for The Frenchmans. The applicant has paid the required license fees. The Public Safety background investigation has been completed and reveals the following: • The corporate structure of the organization has changed from last year. Mary Christine Blake is now the sole owner of the establishment. She also serves as the General Manager of the restaurant. Ms. Blake has no known criminal record. 1210 Frenchmans Renewal Liquor Licenses A 10-year contract deed with William and Joan Snyder continues to be in effect with all payments current. All general real estate, state sales and withholding taxes have been paid and are current. The $10,000 bond issued by Hartford Fire Insurance Company has been submitted. The required proof of liquor liability insurance coverage. has been received showing American Country Insurance Company as affording the required coverage. Proof of workers' compensation insurance has also been supplied. An accountant's statement has been prepared and submitted. This statement covers the period from October 2001 through September 2002 and indicates that food sales accounted for 63% of the total sales, while liquor sales accounted for 37% of the total sales. There were 24 Police and Fire contacts with The Frenchmans from October 2001 through September 2002. This compares with six contacts for the previous year. A breakdown of these contacts is attached to this report. Environmental Health staff received one complaint in 2002 regarding the use of tobacco in prohibited public areas of the restaurant. Doug Deyer from the Bloomington Health Department and The Frenchmans were notified and no further complaints have been received. On-sale Intoxicating and Sunday liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines discipline they can expect if any ongoing problems occur. A copy of this resolution has been given to the owner of the establishment. There are no distance requirements to notify neighbors of the issuance or renewal of on-sale intoxicating and Sunday liquor licenses. The Notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. In July 1999, The Frenchmans was cited for the sale of alcohol to underage youth. They paid a $500 fine and had their license to sell alcohol suspended for two days. The Frenchmans have received no further violations. III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to on-sale intoxicating and Sunday liquor licensing. • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the issuance of the license requested. B. CRITICAL ISSUES • The requirements in Resolution No. 9204 must be met. C. FINANCIAL • None D. LEGAL • None IV. ALTERNATIVE RECOMMENDATION(S) • Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of license extensions to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. • Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance . relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section 14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers. • Breakdown of Public Safety contacts. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Mary Blake, Owner of the establishment The Frenchmans Directors and Officers Mary Blake Owner and General Manager POLICE & FIRE CONTACTS October 2001 through September 2002 2001 2001 TOTAL CONTACTS 6 24 CRIMINAL CONTACTS 3 18 Incidents (see bottom of page for specifics) (2) (14) Alarm (1) (4) MISC. NON-CRIMINAL 3 6 Assists (0) (1) • Traffic (1) (1) Inspections/Licensing (1) (1) Medical/Fire (1) (3) The criminal contacts from October 2001 through September 2002 were: four burglary alarms, six disturbances, one threat, one harassment , one suspic ious person, one narcotics, one suspicious vehicle, two property damage hit and ru n accidents, and one suspicious activity. (Numbers in parenthesis are included in total contact figures) r~ LJ • AGENDA SECTION: ~~ ~) C~ ~G7~1~) /1 G S AGENDA ITEM # ~~ REPORT # ~ ~j cj STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 r~ U REPORT PREPARED BY: BETSY CxRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: ,® ~ SIGNATURE REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Public hearing for consideration of the renewal of 2003 on-sale intoxicating and Sunday liquor licenses for Chi-Chi's, Inc., d/b/a Chi-Chi's Mexican Restaurante, 7717 Nicollet Avenue South. I. RECOMMENDED ACTION: Conduct and close the public hearing and by motion: Approve the renewal of on-sale intoxicating and Sunday liquor licenses for Chi- Chi's, Inc., d/b/a Chi-Chi's Mexican Restaurante, 7717 Nicollet Avenue South. • II. BACKGROUND On October 21, 2002, the City received the renewal application and other required documents for on-sale intoxicating and Sunday liquor licenses for Chi-Chi's, Inc., d/b/a Chi-Chi's Mexican Restaurante. The applicant has paid the required fees. The Public Safety background investigation has been completed and reveals the following: The corporate structure of the organization has remained unchanged from last year. Kevin Relyea serves as President; Robert Trebing, Jr. serves as Vice-President and Treasurer; and Michael Rule serves as Secretary. Michael Blecman continues to 1210ChiChi's Renewal Liquor Licenses serve as the on-premise manager. None of these individuals has any known . criminal record. A current list of officers is attached. All general sales, real estate, and withholding taxes have been paid and are current. The lease between the applicant and the property owner, Maro-Max Company, continues to be in effect with all lease payments current. The $10,000 bond issued by The Insurance Company of the State of Pennsylvania has been submitted. The required proof of liquor liability insurance coverage has been received showing American Home Assurance Company affording the required coverage. Proof of workers' compensation insurance coverage has also been supplied. An accountant's statement has been prepared and submitted. This statement covers the period from October 2001 through September 2002 and indicates that food sales accounted for 61 % of the total sales, while liquor sales accounted for 39% of the total sales. Public Safety Police and the Fire Department had 83 contacts with Chi-Chi's from October 2001 through September 2002. This compares with 72 contacts for the previous year. A breakdown of these contacts is attached to this report. Environmental Health staff received one complaint regarding Chi-Chi's in the past year. The complaint was regarding a broken fence. Chi-Chi's staff was notified and Environmental Health staff received no further complaints. On-sale intoxicating and Sunday liquor licenses require owners of these establishments to comply with Resolution No. 9204, which outlines discipline they can expect if any ongoing problems occur. A copy of this Resolution has been given to the owner of the establishment. There are no distance requirements to notify neighbors of the issuance or renewal of on-sale intoxicating and Sunday liquor licenses. The Notice of Public Hearing was published in the Richfield Sun Current on November 21, 2002. In April of 1999, Chi-Chi's was cited for the sale of alcohol to underage youth. They paid a $500 fine and had their license to sell alcohol suspended for two days. They were cited again in July 1999. They paid a $1500 fine and had their license to sell alcohol suspended for five days. Chi-Chi's received a third violation for the sale of alcohol to underage youth in August 2000. They paid a fine of $1750 and had their license to sell alcohol suspended for ten days. Chi-Chi's has received no violations • in the years 2001 or 2002. III. BASIS OF RECOMMENDATION A. POLICY • The applicant has complied with all of the provisions of both City Codes and State Statutes pertaining to on-sale intoxicating and Sunday liquor licenses. • Based on the information supplied by the applicant and the investigation conducted, there appears to be no reason to deny the issuance of the license requested. B. CRITICAL ISSUES • The requirements of Resolution No. 9204 must be met. C. FINANCIAL • N/A D. LEGAL • N/A IV. ALTERNATNE RECOMMENDATION(S~ • Continue the hearing. However, if the hearing is continued beyond January 1, 2003, the Council should consider the granting of license extensions to allow the applicant to continue to sell liquor until the rescheduled hearing can be conducted. • Suspend or revoke the licenses. Any suspension or revocation must, according to Minnesota State Statute 340A.415, be based upon a finding that the licensee has failed to comply with an applicable statute, rule or ordinance relating to alcoholic beverages. The Council must also note that no revocation or suspension takes effect until the licensee has been afforded an opportunity for a hearing under Section14.57 to 14.70 of the Administrative Procedure Act. V. ATTACHMENTS • List of Officers • Breakdown of Public Safety contacts VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Chi-Chi's Staff • Chi-Chi's, Inc. .7 Chi-Chi's Mexican Restaurante Directors and Officers Kevin Stuart Relyea President Robert Thomas Trebing, Jr. Vice-President & Treasurer Michael Anthony Rule Secretary Michael Blecman On-Premise Manager POLICE & FIRE CONTACTS October 2001 -September 2002 • 2001 2002 TOTAL CONTACTS 72 83 CRIMINAL CONTACTS 53 53 Incidents (see bottom of page for specifics) (49) (50) Alarm (4) (3) MISC. NON-CRIMINAL 19 30 Assists (2) (5) Traffic (2) (1) Inspections/Licensing (10) (22) Medical/Fire (5) (2) The criminal contacts from October 2001 through September 2002 were: nine disturbances, three suspicious persons, nine suspicious vehicles, three burglary alarms, seven thefts, one check forgeries, three property damage accidents, one drunkenness, three assaults, one DWI, one miscellaneous City ordinance violation, two warrant arrests, five suspicious activities, one detox commitment, one threat, one malicious mischief, one received stolen property, and one disorderly conduct. (Numbers in parenthesis are included in total contact figures) • AGENDA SECTION: C(~ ~~ 1 AGENDA ITEM # ~ Q REPORT # ~~ STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 REPORT PREPARED BY: NAME, TITLE REPORT PRESENTER: NAME, TITLE • DEPARTMENT DIRECTOR REVIEW: REVIEWED BY CITY MANAGER RANDY HUGHES, OPERATIONS COORDINATOR MIKE EASTLING, PUBLIC WORKS DIRECTOR 1_I / ITEM FOR COUNCIL CONSIDERATION: Consideration of purchase and installation of HVAC improvements for Public Safety/City Hall. I. RECOMMENDED ACTION: By Motion: Reject all bids and rebid the project due to an error made in the distribution of addenda to the bidders. III. BACKGROUND ~ In October 2002, Council approved the purchase of engineering services from Wentz and Associates to write specifications for replacement of the failing air conditioning chiller, the obsolete Kewanee boiler and the controls for this equipment for the Public Safety/City Hall complex. Preliminary estimated replacement cost for these items was $275,000.00. Wentz prepared specifications, the project was advertised and bids were received on December 3, 2002. Unfortunately the low bidder picked up specifications from Wentz late in the process and was not put on the mailing list to receive the two addenda sent out concerning the specifications. It is staffs recommendation that because of this error, all bids be rejected and the project be readvertised and rebid. The base bids received were as follows: 1210HVAC reject Albers $236,000.00 • NSI Mechanical $263,800.00 Metropolitan Mechanical $414,000.00 III. BASIS OF RECOMMENDATION A. POLICY • The City has the authority to reject all bids and rebid the project due to errors in the bidding process. B. CRITICAL ISSUES • Rebidding will shorten the length of time vendors will have to complete the project but the engineering firm believes the work can still be completed before next year's cooling season. C. FINANCIAL • The bids received were higher than the engineer's estimate and rebidding may provide lower bids. D. LEGAL • The bids could not be accepted due to errors in the bidding process. • IV. ALTERNATIVE RECOMMENDATION(S~ • None V. ATTACHMENTS • Bid tab sheet. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • None • O N .~ O ?~ O N Y N U L .~ c s _ U ~ ~ ~ ~ ~ O O ~ .~ Z o ~U c c -~ ~• co c: ~ Z ~ ~ ~m ~ C ~ ~ O". 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I. RECOMMENDED ACTION: By Motion: Award of contract to Mountain Environmental, Inc. for lime by-product disposal in the amount of $86,940 for the years 2003 and 2004 with the option to renew for another two years. III. BACKGROUND ~ AGENDA SECTION: CONSENT AGENDA ITEM # "t REPORT # Each year, the Dewatering Plant must dispose of approximately 4,500 cubic yards of lime by-product. This material is in a solid form that is dropped from presses into waiting trucks. A formal bid opening for atwo-year (2003 and 2004) contract to dispose of lime by-product was held on Monday, November 18, 2002 with the following results: • Vendor Mountain Environmental, Inc. Base Bid $86,940 The notice of bids for the lime by-product disposal was published both in the Construction Bulletin on November 1, 2002, and the Richfield Sun-Current on 1210Lime Disposal October 31, 2002, with the hope of a greater response. Only the bidding contractor requested the bid specifications. Although there was only one bidder, staff is recommending the bid be accepted because the Mountain Environmental, Inc. is an established sub-contractor with the City and because the bid is $8,910 less than the 2001-02 contract. The contract for 2001 and 2002 was awarded to Rehbein Inc. at the price of $95,850. Rehbein Inc. has been hauling the product for the City since 1998 and in 2001 subcontracted to Mountain Environmental, Inc. who has performed well in that time. III. BASIS OF RECOMMENDATION A. POLICY • Mountain Environmental, Inc. was the only responsible bidder and is an established contractor that meets all requirements. B. CRITICAL ISSUES • It is necessary to remove and dispose the lime by-product from the dewatering presses. C. FINANCIAL • There are sufficient funds in the 2003 Water Maintenance budget for lime by-product disposal. • This bid is $8,910 lower than the prior contract for 2001 and 2002. D. LEGAL • N/A IV. ALTERNATIVE RECONIlVIENDATION(S~ • Council may reject all bids and direct staff to readvertise; however, staff does not believe we can obtain a better price from a reputable contractor. V. ATTACHIVIENTS • Bid minutes and tabulation VI. PRINCIPAL PARTIES EXPECTED AT MEETING • None. • CITY OF RICHFIELD, MINNESOTA • Bid Opening November 18, 2002 11:00 a. m. Disposal of Lime By-Product City Bid No. 02-08 Pursuant to requirements of Resolution No. 1015, a meeting of the Administrative Staff was called by Deborah Guiher, Deputy City Clerk, who announced that the purpose of the meeting was to receive, open and read aloud, bids for disposal of lime by-product, as advertised in the official newspaper on October 31, 2002 and the Construction Bulletin on November 1, 2002. Present: Deborah Guiher, Deputy City Clerk Cheryl Krumholz, City Manager Representative Judy Bergren, Water Plant Supervisor The following bids were submitted and read aloud: Bidder's Name/City Bid Security Total Base Bid Paul Montain Lino Lakes Cashiers check presented $ 86,940.00 The Deputy City Clerk announced that the bids would be tabulated and considered at the December 10, 2002 City Council Meeting. Deborah Guiher Deputy City Clerk • r AGENDA SECTION: CONSENT AGENDA ITEM # rn REPORT # ay (o J STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 • REPORT PREPARED BY: REPORT PRESENTER: DEPARTMENT DIRECTOR REVIEW: l~ REVIEWED BY CITY MANAGER: 7UDY BERGREN, WATER PLANT SUPERVISOR NMI; TITLE MIKE EASTLING, PUBLIC WORKS DIRECTOR Na,~ TircE ITEM FOR COUNCIL CONSIDERATION: Consideration of award of contract for 2,800 tons of quick lime for water treatment. RECOMMENDED ACTION: By Motion: Award of contract to Cutler-Magner Company for quick lime in the amount of $182,000 for the years 2003 and 2004 with the on to renew for another two years. III. BACKGROUND ~ The chemical quick lime is used in the water treatment process to lower water hardness and to produce soft water. Approximately 1,400 tons of quick lime are required each year for treatment. A formal bid opening for atwo-year (2003 and 2004) contract for the purchase of 2,800 tons of quick lime was held on November 21 with the following results: Vendor Unit Price Estimated Annual Cost Cutler-Magner Company $65.00/ton $91,000 The notice of bids for the quick lime was published both in the Construction Bulletin on October 25, 2002, and the Richfield Sun-Current on October 31, 2002, with the 1210Quick Lime hope of a greater response. Only the bidding contractor requested the bid specifications. Although there was only one bidder, staff is recommending the bid be accepted because the Cutler-Magner Company is an established contractor with the City and staff does not believe we can obtain a better price from a reputable contractor. The contract for 1999 and 2000 was awarded to Cutler-Magner Company at a unit price of $62.43 per ton, approximately $87,402.00 per year. This contract was extended for the years 2001 and 2002. III. BASIS OF RECOMMENDATION A. POLICY • Cutler-Magner Company was the only responsible bidder and is an established contractor that meets all requirements. B. CRITICAL ISSUES • Quick lime is a necessary chemical required to reduce water hardness. C. FINANCIAL • There are sufficient funds in the 2003 Water Maintenance budget for the purchase of quick lime. D. LEGAL • N/A IV. ALTERNATIVE RECONIlVIENDATION(S~ • Council may reject the bid and direct staff to readvertise; however, staff does not believe we can obtain a better price from a reputable contractor. V. ATTACFIlVIENTS • Bid minutes and tabulation. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • None. • CITY OF RICHFIELD, MINNESOTA • Bid Opening November 21, 2002 10:30 a.m. Water Treatment Plant Chemicals Quick Lime City Bid No. 02-07 Pursuant to requirements of Resolution No. 1015, a meeting of the Administrative Staff was called by Nancy Gibbs, City Clerk, who announced that the purpose of the meeting was to receive, open and read aloud, bids for water treatment plant chemicals -quick lime, as advertised in the official newspaper on October 31, 2002 and the Construction Bulletin on October 25, 2002. Present: Nancy Gibbs, City Clerk Cheryl Krumholz, City Manager Representative Tom Foley, Transportation Engineer • The following bids were submitted and read aloud: Bidder's Name/City Bond Total Base Bid Cutler-Magner Duluth Presented $ 182,000.00 The City Clerk announced that the bids would be tabulated and considered at the December 10, 2002 City Council Meeting. Nancy Gibbs City Clerk • C7 ~i AGENDA SECTION: CONSENT AGENDA ITEM # t-f (,~ REPORT # c~ CI 'J' ~' STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 REPORT PREPARED BY: JUDY BERGREN, WATER PLANT SUPERVISOR NAME, TITLE REPORT PRESENTER: MIKE EASTLING, PUBLIC WORKS DIRECTOR NAME, TITLE DEPARTMENT DIRECTOR REVIEW: d S/GNA (~~ REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Consideration of award of contract for 400 tons of soda ash for water treatment. I. RECOMMENDED ACTION: By Motion: Award of contract to Hawkins Inc. for soda ash in the amount of $84,000 for the years 2003 and 2004 with the option to renew for another two years. III. BACKGROUND ~ The chemical soda ash is used in the water treatment process to lower water hardness and to produce -soft water. Soda ash removes the non-carbonate hardness from the water as well as assisting the lime in softening the water. Approximately 200 tons of soda ash is required each year for treatment. A formal bid opening for atwo-year (2003 and 2004) contract for the purchase of 400 tons of soda ash was held on November 18 with the following results: i Vendor Hawkins, Inc. Univar USA Inc. Unit Price Base Bid $210.00/ton $84,000 $216.50/ton $86,600 1210Soda Ash The notice of bids for the soda ash was published in the Richfield Sun-Current on October 31, 2002, and there were two requests from contractors for the bid specifications. The contract for 1999 and 2000 was awarded to Feed-Rite Controls, Inc., a division of Hawkins Inc., for the purchase of approximately 400 tons of soda ash at a price of $191 per ton. This contract was extended for the years 2001 and 2002. III. BASIS OF RECOMMENDATION A. POLICY • Hawkins Inc. was the lowest responsible bidder and is an established contractor that meets all requirements. B. CRITICAL ISSUES • Soda ash is a necessary chemical required to soften water. C. FINANCIAL • There are sufficient funds in the 2003 Water Maintenance budget for the purchase of soda ash. D. LEGAL • N/A IV. ALTERNATIVE RECOMIVIENDATION(S~ • Council may accept the bid of Univar USA Inc. although the total purchase price would exceed that of the other bidder. • Council may reject all bids and direct staff to readvertise; however, staff does not believe we can obtain a better price from a reputable contractor. V. ATTACFIMENTS • Bid minutes and tabulation. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • None. CITY OF RICHFIELD, MINNESOTA Bid Opening November 18, 2002 10:30 a.m. Water Treatment Plant Chemicals Soda Ash City Bid No. 02-06 Pursuant to requirements of Resolution No. 1015, a meeting of the Administrative Staff was called by Deborah Guiher, Deputy City Clerk, who announced that the purpose of the meeting was to receive, open and read aloud, bids for water treatment plant chemicals -soda ash, as advertised in the official newspaper on October 31, 2002. Present: Deborah Guiher, Deputy City Clerk Cheryl Krumholz, City Manager Representative Judy Bergren, Water Plant Supervisor • The following bids were submitted and read aloud: Bidder's Name/City Bond Total Base Bid Hawkins Inc. 5% Bid Bond $ 84,000.00 Minneapolis Univar USA 5% Bid Bond $ 86,600.00 St. Paul The Deputy City Clerk announced that the bids would be tabulated and considered at the December 10, 2002 City Council Meeting. Deborah Guiher Deputy City Clerk • • AGENDA SECTION: W11 ~-(l l AGENDA ITEM # REPORT # o~q STAFF REPORT CITY COUNCIL MEETING • • DECEMBER 10, 2002 REPORT PREPARED BY: BETSY CHRISTENSEN, ADMINISTRATIVE SUPPORT SERVICES MANAGER NAME, TITLE REPORT PRESENTER: DAN SCOTT, DIRECTOR OF PUBLIC SAFETY NAME, TITLE DEPARTMENT DIRECTOR REVIEW: ® ~~ SIGNATURE REVIEWED BY CITY MANAGER: ~J .~--_-.' 1 / ~ ~ ITEM FOR COUNCIL CONSIDERATION: Consideration of a request from the Richfield Public Schools to waive all school district food licensing renewal fees and for the Council to consider waiving fees for any other taxing authorities. I. RECOMMENDED ACTION: By Motion: Approve a request from the Richfield Public Schools to waive all school district food licensing renewal fees and approve presentation of future requests by staff to consider waiving fees for an other taxin authorities. II. BACKGROUND On November 29, 2001, a letter signed by Mayor Martin Kirsch was sent to all churches, schools, sports groups and other community organizations explaining that due to municipal aid reduction decisions made by the State Legislature, the City would no longer waive City licensing/permit fees. The letter stated the reasons for the reverse in the City's long-standing practice to waive fees and indicated that the change would become effective on January 1, 2002. 1210School District Food Licensing Fees Since that communication, the City has received a written request (attached) from the Richfield Public Schools and their Supervisor of Fiscal Affairs, Michael E. . Schwartz, requesting that the Council review their request to continue to waive food licensing renewal fees. It should be noted that inspections of food related facilities are conducted by the City of Bloomington through a contract that the Public Safety Department has with them to conduct these types of inspections. A portion of the contract amount is for the cost of conducting inspections of these facilities. However, it should also be noted that. the Richfield School District is a taxing authority, as is the City of Richfield, and that taxpayers are already paying- taxes for the food licensing fees by virtue of the contract that Richfield has with the City of Bloomington. It should- also be noted that the School District frequently extends meeting space to the City. of Richfield. on many. occasions each year. and does not charge a fee to the City to use this space. Over the years, a cooperative, supportive partnership has been established between the City and the schools that acknowledges that the sharing of resources is valuable and important to both. It is for that reason that the request by the School District to waive food licensing renewal fees is supported by the City. It is also being recommended that the City Council consider waiving licensing fees for any other taxing authority that is in the same situation as the Richfield School District. III. BASIS OF RECOMMENDATION A. POLICY • In the past, the School District has not been charged for their food licensing renewal fees. • Due to the municipal aid reduction decisions made by the State Legislature, the City can no longer waive City licensing/permit fees. However, the City of Bloomington presently pays a fee per the contract between the two cities and should not be charged the food licensing fees. The contract includes the cost of conducting inspections. B. CxITICAL IssUEs • N/A C. FINANCIAL • Taxpayers are in effect being asked to pay for these fees twice through City and school taxes. Once, through the contract with the City of Bloomington and again, through the fees charged to the . schools district through food licensing- renewal fees. This action is an acknowledgement that paying for them only once is more appropriate and fair. This would also hold true for any other taxing authorities that may need a license. D. LEGAL • N/A IV. ALTERNATIVE RECOMMENDATION(S~ • The City Council could decide to do nothing, which would result in the School district having to pay food licensing renewal fees. V. ATTACHMENTS • Letter of Request from the Richfield School District. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • None • • [~ ~ ~ j_ j ~ f ~~ D INDEPENDENT SCHOOL DISTRICT 280 f ( j ~ j a~ Preparing Students for a Changing 64orld P~IBLlC • {' ~ ~ j ®jl j (' 612/ 798-6000 J J~ LJj,,.} www.richfield.kl2.mn.us 7001 HARRIET AVENUE SOUTH RICHFIELD MINNESOTA 55423 •November 26; 2002 Ms. Samantha Orduno City Manager City of Richfield 6700 Portland Avenue Richfield, MN 55423 Dear Ms. Orduno, BARBARA S. DEVLIN, Ph.D., Superintendent As a governmental agency, I am writing to formally request a waiver for our business license renewal fees. These licenses allow the school district to prepare and serve breakfast and lunch to our students. A waiver will enable the school district to continue to provide meals to our students at a reasonable cost. I would appreciate if the city council can review our request to continue to waive our business license renewal fees. If you wish to discuss this issue further please feel free to call me at 612-798-6067. Thank you for your consideration. Sincerely, :` Michael E. Sc artz Supervisor of Fiscal Affairs Cc: James Bradley, Business Manager Linda Jacobson, Supervisor of Food Service • AN E6?UAL OPPORTUNITY EMPLOYER • AGENDA SECTION: I~L~Y1 St'rl"~ AGENDA ITEM # ~ LT REPORT # t~ J STAFF REPORT CITY COUNCIL MEETING DECEMBER 1~, 2U~2 REPORT PREPARED BY: SAMANTHA ORDUNO, CITY MANAGER NAME, TITLE REPORT PRESENTER: SAMANTHA ORDUNO, CITY MANAGER NAME, TITLE .7 REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Consideration of the attached indemnification and cooperation agreement regarding the Wold- Chamberlain Field Joint Airport Zoning Board and the Minneapolis-St. Paul International Air ort zonin ordinance deferred from November 12, 2002 . I. RECOMMENDED ACTION: By Motion: Approve the attached indemnification and cooperation agreement regarding the Wold-Chamberlain Field Joint Airport Zoning (JAZ) Board and the Minneapolis-St. Paul International Airport (MSP) zoning ordinance (deferred from November 12, 2002). IL .BACKGROUND Representatives from each of the cities surround the MSP airport have been part of JAZ Board for over a year. The purpose of the Board was to update the Airport Zoning Ordinance, taking into consideration the expansions of current runways, the construction of 17-35 Runway and the implications of the impacts to surrounding community zoning. The Board has prepared a draft ordinance and completed the public hearing on the draft ordinance. • During the course of the Board's review of the relevant data relating to the safety of the airport operations and the safety of the areas surrounding the airport, the question arose as to the legal protections afforded the members of the Board, their communities and the one citizen member of the Board. As the Metropolitan Airports 1202JAZ6 Commission (MAC) did not immediately step forward to indemnify the Board members, all Board actions were suspended until an agreement was developed by • the legal staff of the MAC and the participating cities. The agreement is attached for consideration. Several cities have approved the agreement. This item was deferred from the November 12, 2002 City Council meeting to allow more time to confer with other communities. III. BASIS OF RECOMMENDATION A. POLICY • The agreement is consistent with all relevant laws and City policies. B. CRITICAL ISSiTES • The agreement provides the desired level of indemnification sought by JAZ Board members for themselves and their individual municipalities. C. FINANCIAL • N/A • ~D. LLEGAL • City Attorney Corrine Thomson was involved in the drafting of this agreement and will be available for questions at the Council meeting. on December 10. IV. ALTERNATIVE RECOMMENDATION(S~ • Take no action. This could, however, put the JAZ members and the City at some risk. • Make revisions and request the MAC and the JAZ rd members to consider the revisions. V. ATTACFIlVIENTS • Indemnification and Cooperation Agreement VI. PRINCIPAL PARTIES EXPECTED AT MEETING • None • • INDEMNIFICATION AND COOPERATION AGREEMENT REGARDING THE WOLD-CIiAMBERLAIN FIELD JOINT AIRPORT ZONING BOARD AND THE MINNEAPOLIS-ST. PAUL INTERNATIONAL AIRPORT ZONING ORDINANCE This Agreement is made this day of , 2002, by and between the • Metropolitan Airports Commission ("MAC"), the Cities of Bloomington, Eagan, Mendota, Mendota Heights, Minneapolis, Richfield and Saint Paul and the County of Hennepin (collectively "the Entities") and Mary Hill Smith, an individual ("M. Smith"). RECITALS A. The parties to this Agreement are all of the members of the Wold-Chamberlain Field Joint Airport Zoning Board ("the JAZB") formed pursuant to the authority of Minn. Stat. § 360.063. M. Smith was appointed by the other members as Chair of the Board pursuant to the authority of Minn. Stat. § 360.063, subd. 3(b). B. In 1984 the JAZB adopted the Minneapolis-St. Paul International Airport (Wold-Chamberlain Field) Zoning Ordinance ("the Ordinance") to govern land use and the permitted height of structures, vegetation and other potential obstacles in areas proximate to the Minneapolis-St. Paul International Airport ("the Airport") .and under the approach and departure paths for flights to and from the Airport. • • C. Under the provisions of the Ordinance, an employee of each of the Entities is designated as the Zoning Administrator who is responsible for administering and enforcing the Ordinance for lands located within each respective Entity. D. In connection with construction of a new runway at the Airport and with other changes made at the Airport since 1984, the JAZB is considering certain Amendments to the Ordinance ("the Amendments") that, if formally proposed by the JAZB, must be approved by the Commissioner of the Minnesota Department of Transportation ("the Commissioner") and adopted by the JAZB before they become effective. E. If the Amendments are adopted by the JAZB in a form acceptable to MAC, MAC desires that each of the Entities amend its respective comprehensive plan and zoning code to require compliance with the Ordinance as amended by the Amendments ("Amended • Ordinance') and to include the Amended Ordinance as an appendix to its zoning code. MAC also desires that an employee of each Entity act as the Zoning Administrator to administer and enforce the Amended Ordinance within its respective boundaries. F. The Entities are willing to amend their respective comprehensive plans and zoning codes and to administer and enforce the Amended Ordinance within their respective boundaries. The Entities desire, however, to be protected against possible legal liability that may arise from their doing so. G. M. Smith desires to be protected against possible legal liability that may arise • from serving as Chair of the Board, from actions taken by the Board and by actions taken by the Entities to amend their respective comprehensive plans and zones codes and to administer the Amended Ordinance. 2 • AGREEMENT In consideration of the mutual promises and consideration set forth herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties, intending to be legally bound, agree as follows: 1. Adoption Of Amendments And Effectiveness: After the second public hearing on the Amendments, the JAZB shall send its proposed final version of the Amendments to MAC. The MAC Board of Commissioners shall either approve the proposed final draft or respond by stating the changes to the Amendments needed for this Agreement to be acceptable to the MAC. If the JAZB changes the Amendments as set forth by the MAC Board of Commissioners and adopts the Amendments as changed, and if such Amendments are acceptable to the Commissioner of the Minnesota Department of • Transportation, this Agreement shall become effective immediately; provided it has been executed by MAC and the Entities. 2. Indemnification Of Entities: In consideration of an Entity's (i) amendment of its comprehensive plan to show the areas affected by the Amended Ordinance and to guide land uses in those areas in conformance with the Amended Ordinance, (ii) amendment of its zoning code to incorporate therein a provision requiring compliance with the Amended Ordinance and to add thereto as an appendix the Amended Ordinance and (iii) designation of one of its employees to act as the Zoning Administrator to administer and enforce the Amended Ordinance within the Entity's boundaries, MAC agrees that, subject to the other provisions of this Agreement, it will indemnify and hold harmless: • 3 • a. the Entity; b. any person who serves or has served as the Entity's representative at meetings of the JAZB; and c. any officer, employee or agent of the Entity, other than an attorney employed or retained by the Entity, who may hereafter be responsible for or participate in administering or enforcing the Amended Ordinance within the Entity's boundaries, (collectively, "Indemnified Parties" and individually "an Indemnified Party") from and against any and all losses, liabilities, obligations, costs, expenses, judgments, settlements or other damages (including reasonable attorneys' fees and expenses and reasonable costs of investigating or defending any claim, action, suit or proceeding or of avoiding the same or • the imposition of any judgment or settlement) suffered by the Indemnified Party resulting from or arising out of any act of that Indemnified Party in connection with the consideration and adoption of the Ordinance and Amendments by the JAZB, the amendment of its comprehensive plan to show the areas affected by the Amended Ordinance and to guide land uses in those areas in conformance with the Amended Ordinance, the amendment of its zoning code to require compliance with the Amended Ordinance, the incorporation of the Amended Ordinance as an appendix to its zoning code and administration or enforcement of the Amended Ordinance by the Entity. 3. Indemnification Of M. Smith: In consideration of M. Smith's service as the Chair of the JAZB, MAC agrees that, subject to the other provisions of this Agreement, it will indemnify and hold harmless M. Smith from and against any and all losses, liabilities, obligations, costs, expenses, judgments, settlements or other damages (including reasonable 4 • attorneys' fees and expenses and reasonable costs of investigating or defending any claim, action, suit or proceeding or of avoiding the same or the imposition of any judgment or settlement) suffered by M. Smith resulting -from or arising out of any act of M. Smith as Chair of the JAZB, in connection with the consideration and adoption of the Ordinance and Amendments by the JAZB or out of the acts of the Entities to amend their comprehensive plans to show the areas affected by the Amended Ordinance and to guide land uses in those areas in conformance with the Amended Ordinance, to amend their zoning codes to require compliance with the Amended Ordinance, to incorporate the Amended Ordinance as an appendix to their zoning codes or to administer or enforce the Amended Ordinance. Therefore, for the purposes of this Agreement, M. Smith shall also be an Indemnified Party. 4. Limitations And Exclusions: MAC will not indemnify an Indemnified Party with respect to liabilities or costs resulting from or arising out of: a. a failure by the Indemnified Party or an official, employee or agent of the Indemnified Party to follow the procedures established by the Amended Ordinance, by the comprehensive plan or zoning code of the respective Entity or by applicable state law in performing any act as to which indemnification would otherwise be available under this Agreement; b. the gross negligence or willful misconduct of an Indemnified Party or an official, employee or agent of that Party in performing any of the acts as to which indemnification would otherwise be available under this Agreement; c. actions involving self-dealing or conflict of interest by the Indemnified Party or an official, employee or agent of that Party; or 5 • d. actions of any individual (whether or not that individual is an Indemnified .Party) not performed in an official capacity as a representative of the Entity of which the individual is an official, employee or agent and in direct performance of the individual's duties. 5. Notice Of Claim: If an Indemnified Party receives notice of a claim or of the commencement of an action or proceeding with respect to which the Party believes MAC is required by this Agreement to provide indemnification ("Claim"), the Party must give written notice thereof to MAC within 21 calendar days if the Claim is not asserted in a formal complaint in a legal proceeding, or within 10 calendar days if the Claim is asserted in such a formal complaint ("Notice of Claim"). The failure to give Notice of Claim within the time specified in this section shall relieve MAC of its obligations under this Agreement if in • MAC's reasonable judgment the failure is materially prejudicial to MAC's ability to negotiate, settle or defend the Claim. 6. Assumption Or Rejection Of Defense: Within 10 days after receiving a Notice of Claim in accordance with section 5 of this Agreement, MAC must notify the Indemnified Party providing the Notice of Claim either: a. that MAC will assume complete control of the negotiation, settlement and defense of the Claim and will be responsible for the entire amount of any costs incurred in negotiating, settling and defending the Claim, including any amount required to be paid in settlement of the Claim or in satisfaction of a final judgment, after the conclusion of any appeals, in a lawsuit based on the Claim. MAC must also . notify the Indemnified Party of the name and address of the counsel whom it has assigned or retained to perform MAC's duties under this section. Thereafter, except 6 • with the consent of the Indemnified Party, MAC may not enter into any settlement of the Claim that does not include, as an unconditional term of such settlement, receipt from the _ claimant of an unconditional release to the Indemnified Party from all liability with respect to such Claim; or b. that the Claim is not a claim for which indemnification is required under this Agreement and that MAC therefore declines to provide indemnification. In such a case, the Indemnified Party may itself control the negotiation, settlement and defense of the Claim at its own expense and may select counsel of its own choice for that purpose, and MAC must cooperate with the Indemnified Party in the respects described in sections 7.a, 7.b and 7.c of this Agreement as if MAC were an Indemnified Party. 7. Cooperation Of The Indemnified Party: As a condition of MAC's obligation to indemnify and hold harmless, an Indemnified Party and any Entity with which an individual Indemnified Party is associated: a. must make available to MAC and its counsel all of its books, records and documents that MAC or its counsel determines to be necessary for the defense of any Claim for which indemnification is sought; b. must cooperate fully with MAC to secure any information or testimony that MAC or its counsel determines to be relevant or material to the Claim; c. must execute all necessary pleadings or other documents in any litigation arising out of, or with respect to, any Claim when requested to do so by MAC or its . counsel; provided however, that an Indemnified Party may have counsel of its own choice review any such pleadings or documents, provided that MAC will not be liable 7 • for any expenses relating to ari Indemnified Party's consulting such sepazate counsel; and d. must not settle or compromise any Claim for which MAC has undertaken the Indemnified Party's defense without the prior written consent of MAC. 8. Termination Of Indemnification Obligation: MAC's obligation to provide indemnification pursuant to section 2 of this Agreement will terminate: a. as to an Entity and any Indemnified Party associated with that Entity, if the Entity, having amended its respective comprehensive plan and zoning code as required by section 2 of this Agreement as a condition of its becoming eligible for indemnification, thereafter further amends its comprehensive plan or zoning code so as to change materially the provisions previously adopted pursuant to section 2 of this Agreement; b. as to any Indemnified Party, if the Indemnified Party or an Entity with which an individual Indemnified Party is associated fails to perform any of its obligations under section 7 of this Agreement and does not correct such failure within 30 days after being given notice by MAC that MAC will cease to provide indemnification if the failure is not corrected; c. as to any Indemnified Party, if the Indemnified Party or an Entity with which an individual Indemnified Party is associated fails to perform its obligations under section 5 of this Agreement and if such failure is materially prejudicial to MAC's ability to negotiate, settle or defend the Claim; or d. as to any Indemnified Parry, if, after MAC has assumed responsibility for a Claim under section 6.a of this A Bement MAC or a court or other d' dicatin gr a Ju g 8 entity subsequently determines that the Claim is of a type described in section 4 of this A Bement, as to which no indemnification is re uired in which case MAC must ~' q , promptly notify the Indemnified Party that it will no longer provide indemnification. MAC agrees to notify an Indemnified Party promptly if MAC determines that one of the Limitations or Exclusions in section 4 may apply. In the case of a termination pursuant to section 8.d of this Agreement, MAC shall be entitled to reimbursement of its costs incurred pursuant to section 6.a of this Agreement, and upon receipt of an itemized bill for those costs from MAC, the Indemnified Party shall promptly reimburse MAC for the billed costs. 9. Separate Representation Of Indemnified Party: If an Indemnified Party reasonably determines that there may be a conflict between the positions of MAC and the • Indemnified Party in connection with the defense of a Claim, or that there may be legal defenses available to the Indemnified Party different from or in addition to those being asserted on its behalf by MAC, counsel for the Indemnified Party may conduct, at the Indemnified Party's own expense and at no expense to MAC, a defense to the extent that the Indemnified Party's counsel believes necessary to protect the Indemnified Party's interests. In any event, the Indemnified Party shall be responsible for all fees and expenses of its separate counsel arising from or related to the defense of a Claim for which MAC has assumed responsibility under section 6.a of this Agreement. 10. Resolution Of Disputes Between Parties: If a dispute arises between MAC and an Indemnified Party concerning either party's compliance with or obligations under this Agreement and the parties are unable to resolve the dispute by negotiation or other procedure • (including mediation or arbitration) on which the parties may agree at the time, any lawsuit 9 • 11. Notice: Any notice, direction, or instrument to be delivered hereunder shall be arising from the dispute must be filed in the Minnesota District Court for the Fourth Judicial District (Hennepin County). in writing and shall be delivered to the following: To MAC: Metropolitan Airports Commission Attn: Thomas W. Anderson, Esq. General Counsel 6040 28~' Avenue South Minneapolis, MN 55450-2779 ~J To City of Bloomington: To City of Eagan: To City of Mendota: City of Bloomington Attn: Mazk Bernhardson City Manager 2215 West Old Shakopee Road Bloomington, MN 55431-3096 City of Eagan Attn: Thomas L. Hedges City Administrator 3830 Pilot Knob Road Eagan, MN 55122 City of Mendota PO Box 50688 Mendota, MN 55150 To City of Mendota Heights: City of Mendota Heights Attn: Mayor Charles E. Mertensotto 1101 Victoria Curve Mendota Heights, MN 55118 • To City of Minneapolis City of Minneapolis Attn: Chazles D. Ballentine Director of Planning 350 South Fifth Street Minneapolis, MN 55415-1385 10 • To City of Richfield: City of Richfield Attn: Samantha Orduno City Manager 6700 Portland Avenue South Richfield, MN 55423 To City of Saint Paul: City of Saint Paul Arin: Mayor Randy Kelly 390 City Hall St. Paul, MN 55102 To County of Hennepin: Office of the Hennepin County Attorney Attn: Mark Chapin Managing Attorney A200 Government Center Minneapolis, MN 55487 To M. Smith: Mary Hill Smith 515 North Ferndale Road Wayzata, MN 55391 • Such notice shall be either (i) personally delivered (including delivery by Federal Express or other overnight courier service) to the addresses set forth above, in which case it shall be deemed delivered on the date of delivery to said offices, or (ii) sent by certified U.S. Mail, return receipt requested, in which case it shall be deemed delivered on the date shown on the receipt unless delivery is refused or delayed by the addressee, in which event it shall be deemed delivered on the 3Td business day following deposit in the U.S. Mail. Parties may change to whom notice shall be given by giving notice in accordance with this section, provided that no party may require notice to be sent to more than two addresses. Any individual who claims entitlement to indemnification under this Agreement must include with the Notice of Claim required by section 6 of this Agreement the address to • 11 • which any notice, direction or instrument under this paragraph should be delivered to that individual. 12. Captions: The section headings in this Agreement are for convenience of reference only and shall not define, limit or prescribe the scope or intent of any provision of - this Agreement. 13. Construction: The rule of strict construction shall not apply to this Agreement. The Agreement shall not be interpreted in favor of or against either MAC or any Indemnified Party merely because of their respective efforts in preparing it. 14. Governing Law: This Agreement shall be governed by the laws of the State of Minnesota. 15. Complete Agreement; Amendment: This Agreement sets forth the complete . agreement of the parties with respect to its subject matter. It may be amended, modified or waived as between MAC and any Indemnified Party only by a writing signed by both of them. 16. Signatures: This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original, and such counterparts together shall constitute and be one and the same instrument. Each signatory below represents and warrants that he or she is expressly authorized to enter into this Agreement on behalf of the Party for which that person is signing. Twandets/miscagreements/MAC-JAZB -Indemnification Agreenxnt FINAL 9-11.02.doc 12 INDEMNIFICATION AND COOPERATION AGREEMENT REGARDING. THE WOLD-CHAMBERLAIN FIELD JOINT AIRPORT ZONING BOARD AND THE MINNEAPOLIS-ST. PAUL INTERNATIONAL ' AIRPORT ZONING ORDINANCE SIGNATURE PAGE IN WITNESS WHEREOF, the undersigned have caused this Indemnification and Cooperation Agreement to be executed for the City of Richfield. S CITY OF RICHFIELD Dated: October , 2002. By: Martin Kirsch, Mayor Witness: Title: Dated: October , 2002. By: • Witness: Title: Samantha Orduno, City Manager cAx-ZZno2~1 RC 145-499 CJ AGENDA SECTION: CONSENT AGENDA ITEM # ~ S REPORT # ~~ s~. STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 REPORT PREPARED BY: CHERYL KRUMHOLZ, ADMIN. ASSISTANT NAME, TITLE REPORT PRESENTER: SAMANTHA ORDUNO, CITY MANAGER NAME, TITLE REVIEWED BY CITY MANAGER: ~ ~~~ ~~, , ~ ITEM FOR COUNCIL CONSIDERATION: Consideration of canceling the December 26, 2002 City Council meeting. I. RECOMMENDED ACTION: Motion: Cancel the December 26, 2002 City Council meeting. II. BACKGROUND ~ The City Council regularly meets the second and fourth Tuesday evening of each month. The fourth Tuesday, December 24, is Christmas Eve and Wednesday,. December 25, is Christmas Day. According to the City Charter, the Council would be scheduled to meet on Thursday, December 26, 2002. Past practice has been to cancel the Council meeting on the fourth Tuesday of December due to the Christmas holiday. Agenda items for the December 26 Council meeting can be carried over to January 14, 2003. Therefore, it is suggested that the Regular Council meeting scheduled for December 26 be canceled. III. BASIS OF RECOMMENDATION • A. POLICY • Richfield City Code Section 205.01, Regular Meetings, states that if a Regular City Council meeting date is a legal holiday, the meeting shall be held on the next following day at the same hour and place. 1210cancel • Past practice has been to cancel the Council meeting on the fourth Tuesday of December due to the Christmas holiday. B. CRITICAL ISSUES • City Council business can be carried over to January 14, 2003. • This item has been placed on the December 10 City Council agenda so proper notification can be made if the meeting is canceled. C. FINANCIAL • N/A D. LEGAL • N/A IV. ALTERNATNE RECOMMENDATION(S~ • Do not cancel the December 26 Council meeting. • Conduct the second Regular Council meeting on Monday, December 23. V. ATTACHMENTS • None. • VI. PRINCIPAL PARTIES EXPECTED AT MEETING • None. • • AGENDA SECTION: CcUr'1 SE'--T1T AGENDA ITEM # ~ ~-I REPORT # ~cj STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 REPORT PREPARED BY: STEVEN L. DEVICH NAME, TITLE • REPORT PRESENTER: DEPARTMENT DIRECTOR REVIEW: REVIEWED BY CITY MANAGER: !~ ITEM FOR COUNCIL CONSIDERATION: Extension of contract with Hennepin County for access to property information system RECOMMENDED ACTION: By Motion: Authorize the extension of Contract No. A0,21020 with Hennepin County to allow continued access to the property information system for the period beginning January 1, 2003 and ending December 31, 2003. II. BACKGROUND Since September 19, 1978 Hennepin County and the City have had a contractual agreement which provides the City with access to the County's real estate tax information. In November 1990, the City Council approved the purchase of the Hennepin County data terminal, software and printer when the County announced that it was getting out of the leasing business. After purchase of the equipment, the City entered into a contract with Hennepin County to provide continued access to County data with the City's owned equipment. The current contract provides the City with an extremely economical way to access Hennepin County real estate, municipal and district court data. The contract is not automatically renewable and must be renewed each year by the City and County. 121002Asses The City has now received information from Hennepin County announcing the fees • for the contract year 2003 and is asking if the City is interested in renewing this contractual agreement. The Council action here would be to take advantage of the renewal. III. BASIS OF RECOMMENDATION A. POLICY • The City of Richfield contracts with Hennepin County for assessing services. The City and the County can share the same property information system with the appropriate agreement in place. B. CRITICAL ISSUES • The current contract with Hennepin County expires as of December 31, 2002. Action should be taken now to ensure that the service is maintained without interruption. • The contract is a necessary part of the City's ability to deliver property and court data to the public. C. FINANCIAL • The County has set the 2003 inquiry fees at the rate of $.0157 per transaction, which is .001 more than the rate charged in 2002. • The network support charge will be $22 per month per workstation (increased from $22 in 2002). • The contract with Hennepin County is still a very economical way for the City to access and provide this data to the public. D. LEGAL • The City and County may enter into a legal contract for the provision of this service. IV. ALTERNATIVE RECOMMENDATION~S~ • The City could elect not to renew this contract with Hennepin County. However, if this contract were not renewed, the City would lose its on-line access to County property tax and court records. V . ATTACHMENTS • Hennepin County Contract No. A021020 VI. PRINCIPAL PARTIES EXPECTED AT MEETING • :~ Hennepin County Information Technology Operations Division A-015 Government Center Minneapolis, MN 55487 November 14, 2002 City of Richfield Ms. Samantha Orduno 6700 Portland Avenue Richfield, MN 55423 Dear Ms. Orduno: Hennepin County has revised and updated the contract used for access to the computerized information. It is the intention of Hennepin County to have the agreement A01384 terminate on 12/31/02 and have the new agreement A021020 be effective January 1st, 2003. One change in the new agreement is that we will not require the annual renewal agreement letter as was required in the past. The rates for the service are updated annually and a notification of the rates for the upcoming year along with a revised Exhibit to show the changes will be mailed out in October/November of each year. Enclosed are two copies of the contract to be signed and approved by the appropriate authorized city officials. Please indicate how the city is organized on the signature page and send a certified copy of the City Council resolution authorizing the contract along with the two signed contract documents. A fully executed copy will be returned to you. Please review the Exhibit page that outlines the accesses you have and the number of connections. It also includes information on the rates for 2003. If you have any questions or concerns please notify me at (612) 348-6666. Thank you. Sincerely, C%~~,~, ~~~~~~ Jean Myers Hennepin County IT Operations A-015 Government Center Minneapolis, MN 55487 (612) 348-6666 j ean.myers@co.hennepin.mn.us • Enclosure • Contract No. A021020 AGREEMENT THIS AGREEMENT, made and entered into between the COUNTY OF HENNEPIN, a political subdivision of the State of Minnesota, hereinafter referred to as "COUNTY" and City of Richfield, 6700 Portland Avenue, Richfield, MN 55423, hereinafter referred to as "SUBSCRIBER' ; WITNESSETH: NOW, THEREFORE, the parties hereto agree as follows: A. The COUNTY shall allow the SUBSCRIBER file inquiry access to certain information contained in COUNTY computerized data files through SUBSCRIBER owned computer equipment operating in conjunction with the COUNTY computer system. 1. The SUBSCRIBER shall be solely responsible for selecting obtaining, installing, maintaining, repairing, modifying and/or replacing any equipment used to access or attempt to access the computer system. At SUBSCRIBER's request, the COUNTY will furnish information concerning equipment the COUNTY believes to be compatible for requested access. 2. The SUBSCRIBER agrees to install and maintain and keep up to date virus protection software and firewall technology on each personal computer or device being • connected to the COUNTY's network. The SUBSCRIBER agrees to upgrade virus protection software and firewall technology to keep at the most current version. The SUBSCRIBER agrees to be responsible for any and all damages caused as a result of unauthorized access through the SUBSCRIBER's equipment and for any virus being transmitted to COUNTY computer systems. 3. During the term of this agreement, the technical aspects of connections may change which may require change or action by SUBSCRIBER. SUBSCRIBER will receive notice of any required changes and will be expected to comply within the specified timeframe indicated in the notice. Unless absolutely necessary, specified timeframe should not be less than 30 days. 4. SUBSCRIBER agrees to protect and keep private and secure, any access passwords given to SUBSCRIBER, and to not release passwords to any unauthorized individual. The SUBSCRIBER agrees to be responsible for any and all damages caused as a result of unauthorized use of the access password(s) by any authorized or unauthorized individual. B. The COUNTY shall set forth costs, billing information and type(s) of information which the COUNTY will permit the SUBSCRIBER to access in Exhibit A, attached hereto and made a part hereof by this reference. SUBSCRIBER shall be responsible for the payment of any and all file inquiry fees, connection charges, telephone line or frame relay charges where appropriate, and any related installation/de-installation charges. SUBSCRIBER will be billed by the COUNTY on a monthly basis and may be billed separately by the telephone company for the telephone or frame relay charges. Payment shall be made by SUBSCRIBER within • thirty (30) days after receipt of each said bill. Connection and telephone or frame relay charges shall be payable whether or not SUBSCRIBER has accessed the information during any month SUBSCRIBER is permitted to access such information. IT Form Contract Rev. Nov., 2002 • C. It is understood and agreed that if it is determined by the COUNTY that it is necessary to allocate time and capacity utilization of the computer system in order to carry out COUNTY activities properly, the COUNTY may reduce or discontinue service for such length of time as the COUNTY may deem appropriate. The COUNTY, in good faith, shall endeavor to notify the SUBSCRIBER prior to any such service interruption whenever the COUNTY shall determine the pertinent circumstances reasonably permit such notification. D. The hours of service furnished hereunder are subject to the provisions of paragraph D and generally limited to the business hours observed by the COUNTY at the Hennepin County Government Center and, therefore, will be observed as follows: 1. Monday through Friday - 8:00 a.m. to 5:00 p.m. 2. Service will not be available on holidays or other time off observed by the COUNTY. 3. The COUNTY reserves the right to change said business hours and shall give written notice to SUBSCRIBER of any such change. Access to this service may also be available (at the COUNTY's sole discretion) at times beyond normal business hours. E. 1. The COUNTY does not warrant or guarantee the performance of the main computer system, the telephone lines and/or cabling, or any software and/or equipment in connection or in association with any or all of the foregoing, nor does the COUNTY warrant or guarantee any programming utilized in any of the above. Further, the COUNTY shall have no obligation or liability whatsoever concerning any aspect of the telephone line or frame relay . lines. It is specifically understood by the SUBSCRIBER that changes and adjustments are made in the official records from time to time which may be in process at any given time; and, under the circumstances, the information received by the SUBSCRIBER will be subject to such changes and adjustments. Accordingly, errors or omissions may occur in the data received on or through the pertinent equipment utilized by or servicing the SUBSCRIBER. Further, the SUBSCRIBER specifically understands and agrees that the service furnished under this Agreement is subject to the temporary or permanent inability of the COUNTY to furnish either and also is subject to errors, omissions, damages, reductions, discontinuances, malfunctions, inoperativeness, scheduled downtimes, delays or interruptions which may be due to any one or a combination of a wide spectrum of causes. While the COUNTY shall endeavor in good faith to maintain a high degree of accuracy and efficiency in the services provided hereunder, the sole and exclusive remedy for any breach of this Agreement by the COUNTY and for COUNTY liability of any kind whatsoever, including but not limited to liability for nonperformance or any deficiencies with respect to said services, shall be limited to restoring the services and/or any deficiency in said service as is reasonably possible under the pertinent circumstances. SUBSCRIBER fully understands and agrees that the COUNTY may change, modify and/or replace said computer system and any components thereof including, without limitation, any related equipment, software, wiring and/or cabling, and that, incidental thereto, any such change, etc. could possibly extinguish or impair the compatibility between SUBSCRIBER's equipment and said computer system, thus necessitating, perhaps, the replacement of, changes to, and/or modification.of SUBSCRIBER's equipment to access said computer system; and that in any such event the COUNTY will in no manner be liable for the costs and/or damages which are sustained by SUBSCRIBER and which are, in any respect, associated, directly or indirectly, with any or all of the foregoing occurrences but that SUBSCRIBER shall bear the full costs thereof. In no event shall the COUNTY be liable for actual, direct, indirect, special, incidental, consequential damages (even if the COUNTY has IT Form Contract Rev. Nov., 2002 • been advised of the possibility of such damage) or loss of profit, loss of business or any other financial loss or any other damages. 2. Supplemental to and in no manner in limitation of the foregoing the following is set forth: The information furnished and to be furnished has been and shall be obtained from the COUNTY'S records and is believed to be reliable. But the accuracy, completeness, timeliness or correct sequencing of the information is not guaranteed by COUNTY. There may be delays, interruptions, omissions or inaccuracies in the receipt of the information. The SUBSCRIBER agrees that the COUNTY shall have no liability, contingent or otherwise, for the accuracy, completeness, timeliness or correct sequencing of the data, or for any decision made or action taken by SUBSCRIBER in reliance upon the data. THERE IS NO WARRANTY OF MERCHANTABILITY, NO WARRANTY OF FITNESS FOR PARTICULAR USE, AND NO OTHER WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, REGARDING THE INFORMATION OR ANY ASPECT OF THE SERVICE. F. 1. During the contract period, the COUNTY may change any portion of the monthly charges, provided that a thirty (30) day written notice be given to the SUBSCRIBER prior to the effective date of the change. Any such change will appear on the appropriate monthly billing, except that any telephone line or frame relay charge change shall not require written notice but shall be effective immediately and shall be payable when included in the monthly billing presented to SUBSCRIBER as provided herein. Additional connections and accesses to information may be requested in writing at any time. If access is authorized, the appropriate description and charges will be outlined in an Exhibit bearing an exhibit letter in proper sequence to Exhibit A, and be attached to and made part of this agreement. • 2. This Agreement shall commence on the date of its approval by the COUNTY and remain in effect until cancelled by either party. Rates charged for this service are reviewed annually by the COUNTY and rate changes take effect January 1st of each year. Notice of any rate changes affecting this service will be sent out along with a revised exhibit 30 days prior to the effective date. These rate changes will take effect on the first of January. 3. This Agreement may be cancelled with or without cause by either party giving 30 days prior written notice thereof to the other party. G. SUBSCRIBER agrees that during the term of this Agreement, in addition to the fees/charges provided herein to be paid, it will promptly pay all taxes, assessments and other governmental charges, if any, levied or assessed upon the services furnished hereunder to SUBSCRIBER, and SUBSCRIBER will promptly pay or reimburse the COUNTY for all taxes levied or assessed against and paid by the COUNTY on account of its furnishing services to SUBSCRIBER hereunder. H. In the event the SUBSCRIBER~shall fail duly and promptly to perform any of its obligations under the provisions of this Agreement, the COUNTY, at its option, may immediately, or any time thereafter, perform the same for the account of the SUBSCRIBER without waiving such default, and any amount paid or expense or liability incurred by the COUNTY in such performance, together with interest thereon at the highest maximum rate permitted by applicable law until paid by the SUBSCRIBER to the COUNTY, shall be payable by the SUBSCRIBER upon demand. I. 1. There shall be deemed to be a breach of this Agreement: IT Form Contract Rev. Nov., 2002 • (a) If the SUBSCRIBER shall default in any payment due hereunder and such default shall continue for a period of ten (10) days after due; (b) The County may terminate this Agreement immediately upon SUBSCRIBER's default or breach of any term or condition contained herein. (c) If SUBSCRIBER, without-the COUNTY's prior written consent, removes or permits any of the same, to be used by anyone, or sells, pledges, assigns, hypothecates, transfers, subleases or otherwise disposes of or encumbers this Agreement or-any part hereof or any part thereof or attempts to do any of the aforesaid. 2. In the event of SUBSCRIBER's breach of this Agreement, as herein defined: (a) The County may cancel this Agreement upon written notice to SUBSCRIBER. (b) The SUBSCRIBER shall be liable for all costs, damages and losses incurred by the COUNTY on account of said breach and/or also in canceling or terminating this Agreement. (c) All sums due and to become due hereunder, at the COUNTY's option, shall become payable forthwith. (d) The COUNTY may also enforce specific performance of the applicable covenants of this Agreement by appropriate legal proceedings, as well as any other remedy herein provided. Should any legal proceedings be instituted by the COUNTY to recover any monies due or to become due hereunder, and/or to recover other damages sustained by the COUNTY on account of such breach, the SUBSCRIBER shall pay a reasonable sum as attorney's fees. J. No right or remedy of the COUNTY hereunder shall be exclusive of any other right or remedy herein or by law, statute or equity provided, but each shall be cumulative and in addition to every other right or remedy, and shall be deemed to be continuing, none of which shall be exhausted by being exercised on one or more occasion and may be enforced concurrently or from time to time: K. SUBSCRIBER, its officers, agents, owners, partners, employees, volunteers and subcontractors agree to abide by the provisions of the Minnesota Government Data Practices Act, Minnesota Statutes, Chapter 13, and all other applicable state and federal laws, rules, regulations and orders relating to data privacy or confidentiality, and as any of the same may be amended. The SUBSCRIBER shall defend, indemnify and hold the COUNTY harmless from any and all liability, claims, damages, judgments, costs (including reasonable attorneys' fees), demands or actions arising, directly or indirectly, out. of any act or omission on the part of the SUBSCRIBER, its employees, officers, agents, contractors or representatives relating to the obtaining, use, and or possession of information provided hereunder, SUBSCRIBER's access to the computer system, including without limitation, the obtainment, installation/de-installation and/or existence of telephone lines and any and all activities related thereto, and/or relating to . the ownership, use or operation of SUBSCRIBER's equipment and/or software and items relating to such software and/or equipment, and from all loss or liability by reason of failure of IT Form Contract Rev. Nov., 2002 the SUBSCRIBER, in any respect, to perform fully or observe all obligations under this Agreement. L. Any notice or demand, which may or must be given or made by a party hereto, under the terms of this Agreement or any statute or ordinance, shall be in writing and shall be sent registered or certified mail to the other party addressed as follows: TO SUBSCRIBER:. City of Richfield City Manager 6700 Portland Avenue Richfield, MN 55423 TO COUNTY: Hennepin County Administrator A-2300 Government Center Minneapolis, MN 55487 Copy to: Division Manager Information Technology Operations A-015 Government Center Minneapolis, MN 55487 Either party may designate a different addressee or address at any time by giving written notice thereof as above provided. Any notice, if mailed, properly addressed, postage prepaid, registered or certified mail, shall be deemed dispatched on the registered date or that stamped on the certified mail receipt and shall be deemed received within the second business day thereafter or when it is actually received, whichever is sooner. Any notice delivered by hand shall be deemed received upon actual delivery. M. No oral agreement, guarantee, promise, condition, representation or warranty shall be binding; all prior conversations, agreement or representations related hereto are integrated herein, and no modification hereof shall be binding unless in writing and signed by the COUNTY. N. This Agreement shall be governed by and construed under the laws of the State of Minnesota. Hennepin County shall be the appropriate venue and jurisdiction for any litigation arising hereunder, except that venue and jurisdiction in the Federal courts shall be in the appropriate Federal Court within the State of Minnesota. If any provision of the Contract is held invalid, illegal, or unenforceable, the remaining provisions will not be affected. O. It is agreed that nothing herein contained is intended or should be construed in any manner as creating or establishing the relationship of joint ventures or co-partners between the parties hereto or as constituting the SUBSCRIBER as the agent, representative or employee of the COUNTY for any purpose or in any manner whatsoever. The SUBSCRIBER is to be and shall remain an independent SUBSCRIBER under this Agreement. Any and all personnel of the SUBSCRIBER or other persons, while engaged in the performance of any activity under this Agreement, shall have no Contractual relationship with the COUNTY and shall not be considered employees of the COUNTY. P. The COUNTY's failure to insist upon strict performance of any covenant, Agreement or stipulation of the Contract or to exercise any right herein contained shall not be a waiver or relinquishment of such covenant, Agreement, stipulation or right unless the COUNTY IT Form Contract Rev. Nov., 2002 • • consents thereto in writing. Any such written consent shall not constitute a waiver or relinquishment of the future of such covenant, Agreement, stipulation or right. Q. Upon. the date of approval of this Contract by the County, Contract A01384 shall be cancelled immediately and Contract A021020 will commence. SUBSCRIBER, having signed this Agreement, and Hennepin County having duly approved this Agreement on the 12-10 .day of 12002 ,and pursuant to such approval, the proper County officials having signed this Agreement, the parties hereto agree to be bound by the provisions set forth herein. COUNTY OF HENNEPIN, STATE OF MINNESOTA Approved as for form and execution: BY: Deputy/Associate County Administrator Assistant County Attorney Date: CITY OF RICHFIELD By: Its Mayor Martin Kirsch And: Its City Manager Samantha Orduno • City organized under: Statutory Option A Option B. IT Form Contract Rev. Nov., 2002 Charter 6 EXHIBIT A to Contract A021020 City of Richfield Year (2003) In addition to other terms stated herein, in the above referenced contract, of which this Exhibit A is a part, this Exhibit also includes provisions relating to a frame relay circuit(s). I. The COUNTY will provide inquiry-only access public and non-public information in the following systems: Property Information System: Access to this system will permit viewing of current real estate tax information, including legal descriptions, valuations, special assessments and other public data retained in the Property Information Systems. Document Recording System: Access to this system will permit viewing of current information on documents filed with the County Recorder (Abstract) and Registrar of Titles (Torrens) retained in the Document Recording System since January 4, 1988. Subject-In-Process (SIP) System: Access to this system will permit inquiry into the District Court System. Information to be obtained includes case-related information concerning offense, disposition, participants, scheduling and other public data contained in the Subject in Process System. Such access and retrieval of such data shall be • governed by the Rules of Access for records of the Judicial Branch or other applicable rule or law. Civil Automated Tracking System (CATS): Access to this system will permit viewing of index and case status information, including family and unlawful detainer matters appearing in the District Court. The system will identify the case-by-case type and will provide information on filing and appearance activities, including whether or not the case is closed. There is also an attorney table which provides information on all known attorneys on a case. Sheriff Warrant System: Access to this system will permit inquiry into the Sheriffs Warrant System (Warrant System). This inquiry will be by name search and will provide warrant related information, including warrant number, date, offense and other data contained in the Warrant System. In addition to the terms and conditions of Contract, of which this Exhibit A forms a part, it is also specifically agreed that access to and use of the Warrant System will be governed by and subject to the following: A. It is planned that mobile digital terminals will also be utilizing the Warrant System, and the reasonable possibility exists that a great number of such mobile digital terminal accesses could result in the overloading and slowing down of the computerized criminal justice system of the County, which includes the Warrant System. In the event such overloading should occur, the County, through the Hennepin County Sheriff (Sheriff), reserves the right to suspend and/or allocate access to the Warrant System as follows: • 1. If the Sheriff believes that due to said overloading there is the immediate need to reduce access to the Warrant System, he may, upon oral notification to IT Form Contract Rev. Nov., 2002 • SUBSCRIBER, suspend and/or apportion SUBSCRIBER's Warrant System access for a period not to exceed 144 hours from the time of said notice, provided that the Sheriff .shall immediately send to SUBSCRIBER a written communication verifying and reiterating the contents of such oral notice. The Sheriff may. utilize as many 144-hour suspension/allocation periods as he may deem the circumstances reasonably require, provided that said oral and corresponding written notices are given for each such period. 2. In addition to the right of the Sheriff to immediately suspend and/or apportion Warrant System access because of system overloading, as aforesaid, the Sheriff for said overloading may also suspend and/or apportion Warrant System access for indefinite or specific time periods, as he may deem appropriate; provided that any such suspension or allocation period shall not commence earlier than five (5) days following the date of receipt by SUBSCRIBER of written notice from the Sheriff, which notice shall specify the date of commencement of any such suspension and/or allocation, the details thereof, and, in the case of a specific time period, the date of its termination; provided further that for suspensions and/or allocations of an indefinite period, the Sheriff may recommence SUBSCRIBER's access to the Warrant System by giving to SUBSCRIBER written notification of the same. 3. The Sheriff shall monitor the circumstances surrounding the overload and/or the problems which caused the same and shall cancel any aforesaid suspension or allocation period and recommence SUBSCRIBER's Warrant System access, giving SUBSCRIBER prompt notice of the same, whenever in his judgment the circumstances permit and/or such problems have been adequately resolved. If the Sheriff determines that the circumstances do not permit restoration of full access, the Sheriff may restore such access as he determines appropriate until such time as he determines that restoration of full access is feasible, provided that written notice of any such determination shall be promptly given to SUBSCRIBER. 4. The Sheriff may utilize any one or a combination of the aforesaid suspension/allocation alternatives for as many times as he deems necessary in order to achieve the herein stated purpose. 5. The rights of the Sheriff hereunder respecting the alleviation of overloading are in addition to and not in limitation of similar rights of the County provided for in said Contract. However, in addition to any said rights of the County, the County, in an effort to alleviate overloading problems which it determines to be contributed to by SUBSCRIBER's access, may terminate SUBSCRIBER's Warrant System access through a particular telephone line and require SUBSCRIBER - if SUBSCRIBER still desires Warrant System access - to install and use a new dedicated line, with SUBSCRIBER paying the entire costs of such arrangement. 6. SUBSCRIBER shall have no claim whatsoever against the County, the Sheriff or their officers, employees, agents or contractors respecting any aspect of any decision regarding whether or not to suspend, allocate or terminate, as aforesaid. 7. The term "oral notification", as herein used, shall mean the oral communication of the pertinent information to the Police Chief of the City of Richfield or • any one of his police captains or the on-duty shift supervisor. Said information may be given to any of the aforenamed persons either in person or by telephone. IT Form Contract Rev. Nov., 2002 8. For purposes of the herein provisions, the term "Sheriff' shall mean the Sheriff or his designee. B. In cooperation with the efforts of the County to avoid intensifying problems associated with the overcrowding of the Hennepin County Adult Detention Center (HCADC), SUBSCRIBER hereby warrants and agrees that unless and until its Warrant - ,. System access is completely terminated, as hereinabove provided in accordance with the termination or cancellation provisions of the herein contract, and not merely - suspended as hereinabove set forth, SUBSCRIBER shall continue its current practice of detaining and transporting to a suburban court from said HCADC all misdemeanants who are arrested or caused to be arrested by Richfield Police - whether or not as a result of information obtained from said Warrant System -and who are unable to secure release from custody. C. SUBSCRIBER agrees that all name matches or "hits" on warrant inquiries must be verified telephonically by the Hennepin County Sheriffs Warrant Division before any enforcement action or detention shall occur. Such verification shall include the ascertainment that the warrants are currently on file and active within said Warrant Division, in particular whether or not each warrant has been executed or cancelled. SUBSCRIBER also agrees that all conditions, i.e., nightcapped, etc., respecting each warrant are appropriately observed." D. The warrant system access will be available to SUBSCRIBER 24 hours a day, 7 days a week, except for scheduled and non-scheduled downtime. • II. Billing Charges for all services will be billed monthly. III. Usage Charges A file inquiry fee of $ .0157 per transaction will be charged monthly for each inquiry to the system. IV. Network Support Charges -Monthly Connection Charge The SUBSCRIBER will be charged $23.00 ($17.00 basic service plus $6.00 host charge) for each workstation connected to Hennepin County's teleprocessing network. The SUBSCRIBER will be charged appropriately for any additional connections. The City of Richfield currently has twenty-six (26) connections. V. Frame Relay/Telephone Lines 1. For purposes of the aforementioned contract (including this exhibit), the term "telephone line(s)" includes without limitation any and all lines, cabling, communication circuits, and/or data circuits in connection with the frame relay circuit and related equipment and/or software. 2. SUBSCRIBER understands and agrees that the COUNTY will not be responsible in any manner for accessing and linking any portion of SUBSCRIBER's frame relay circuit with lines and/or connections owned or used by the COUNTY. IT Form Contract Rev. Nov., 2002 9 • 3. The COUNTY will assume no liability for services of any kind and equipment provided by Qwest, LOGIS or any other person or entity.. The COUNTY will only be liable to the extent expressly set forth in said contract. 4. SUBSCRIBER understands and agrees that SUBSCRIBER, Logis and/or other person -not the COUNTY -will: a. provide, maintain, diagnose and correct problems of, and support such frame relay and its access link; b. be responsible for the installation and configuration of the IBM 3270 emulation or Attachmate Extra software; c. be responsible for the configuration of SUBSCRIBER's wide area network to support the bridging protocols required for access to the COUNTY; d. diagnose and correct problems with the 3270 emulation software, provided that the COUNTY when requested by SUBSCRIBER will render such assistance as the COUNTY deems it reasonably can provide; such assistance shall be rendered only from COUNTY premises consistent with the terms and conditions of said contract; and e. notify the County of planned outages that will affect SUBSCRIBER. • IT Form Contract Rev. Nov., 2002 10 AGENDA SECTION: ~(1~jf~.f1-f AGENDA ITEM # I-} ~- REPORT # ~ 9 Q STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 REPORT PREPARED BY: CHRIS REGIS, FINANCE MANAGER NAB, TITLE • REPORT PRESENTER: CHRIS REGIS, FINANCE MANAGER N TITLE DEPARTMENT DIRECTOR REVIEW: IGNATURE -~ REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Consideration of the attached resolution with regards to the financing of a project to be undertaken by the Academy of Holy Angels. I. RECONIlVIENDED ACTION: By Motion: Approving and Authorizing The Issuance of its Educational. Facilities Revenue Note (Academy of Holy Angels Project), Series 2002, Under Minnesota Statutes, Sections 469.152 Through- 469.165, As Amended, to Finance Property for the Benefit of Academy of Holy Angels; Approving the Form and Authorizing the Execution of Related Documents; and Providing for the Security, Rights and Remedies of the Owners of the Note. • II. BACKGROUND At the November 26, 2002 City Council meeting, a preliminary resolution was approved that gave preliminary approval to the financing of a project to be undertaken by the Academy of Holy Angels (Holy Angels). Tonight's City Council • meeting is the final step in the process of approving financing for the project. As was described at the November 26, 2002 City Council meeting the project is a planned- renovation and addition of existing facilities. It would include the construction and equipping of a new convocation center and gymnasium including class and meeting room space together with related facilities. To finance the project, the City proposes to issue a revenue obligation to be designated the Educational Facilities Revenue Note (Academy of Holy Angels Project). The revenue; obligation would be purchased by Wells Fargo Bank Minnesota, National Association, with the proceeds of the sale then being- loaned to Holy Angels. The revenue obligation would use the City's remaining 2002 bank qualified debt. The City would only serve as a conduit for the project financing. The City would not incur any financial liability as a result of the issuance of the debt, nor would the City incur any out of pocket expenses. III. BASIS OF RECONIMENDATION A. POLICY • Under the Minnesota Municipal Industrial Development Act, Minnesota Statutes, Sections 469.152 to 469.165, the City of Richfield has authority to issue revenue bonds. B. CRITICAL ISSUES • The remaining balance of bank qualified debt for 2002 expires at December 31, 2002. C. FINANCIAL • The amount of the Educational Facilities Revenue Note (Academy of Holy Angels Project) is $8,540,000. • The Educational Facilities Revenue Note will be issued in the City's name, but will not be a charge against the City's general credit or taxing powers. The City will act as a conduit for the financing of the project. It does not create any financial liability to the City. • The estimated cost of the project is approximately $10.8 million. • The City is to be reimbursed and- held harmless for and from any out-of-pocket expenses related- to the tax exempt financing, including, but not limited to, legal fees, financial analyst fees, bond counsel fees, staff costs, and any deposits or application fees required under state law in order to secure allocation of bonding authority. • • • The applicant will be charged an annual administrative fee in the amount of 1/8th of 1% (.125%) of the outstanding principal balance of the bonds. D. LEGAL • Kennedy & Graven will serve as bond counsel for the issue. IV. ALTERNATIVE RECOMMENDATION(S~ • Forgo approving the attached resolution and not proceed with the issuance of the private activity revenue bonds. V. ATTACHMENTS • Resolution Approving and Authorizing The Issuance of its Educational Facilities: Revenue Note (Academy of Holy Angels Project), Series 2002, Under Minnesota Statutes, Sections 469.152 Through 469.165, As Amended, to Finance Property for the Benefit of Academy of Holy Angels; Approving the Form and Authorizing the Execution of Related Documents; and Providing for the Security, Rights and Remedies of the Owners of the Note • Educational Facilities Revenue Note(Academy of Holy Angels Project) • Loan Agreement between City of Richfield and Academy of Holy Angels • Pledge Agreement between City of Richfield and Wells Fargo Bank Minnesota, National Association VI. PRINCIPAL PARTIES EXPECTED AT MEETING • John Utley, Kennedy & Graven, Chartered • Dr. Jill Reilly, Academy of Holy Angels • Michael Schaefer, Catholic Finance Corporation • Paul Tietz, Briggs and. Morgan . RESOLUTION NO. RESOLUTION APPROVING AND AUTHORIZING THE ISSUANCE OF ITS EDUCATIONAL FACILITIES REVENUE NOTE (ACADEMY OF HOLY ANGELS PROJECT), SERIES 2002, UNDER MINNESOTA STATUTES, SECTIONS 469.152 THROUGH 469.165, AS AMENDED, TO FINANCE PROPERTY FOR THE BENEFIT OF ACADEMY OF HOLY ANGELS; APPROVING THE FORM AND AUTHORIZING THE EXECUTION OF RELATED DOCUMENTS; AND PROVIDING FOR THE SECURITY, RIGHTS AND REMEDIES OF THE OWNERS OF THE NOTE WHEREAS, under the Minnesota Municipal Industrial Development Act, Minnesota Statutes, Sections 469.152 through 469.165, as amended (the "Act"), each municipality and redevelopment agency of the State of Minnesota (as defined in the Act), including the City of Richfield, Minnesota (the "City"), is authorized to issue revenue obligations to finance improvements to land and buildings and capital equipment for the benefit of a revenue producing enterprise to be owned by a contracting party (as defined in the Act); and WHEREAS, the City has proposed to issue a revenue obligation to be designated the Educational Facilities Revenue Note (Academy of Holy Angels), Series 2002 (the "Revenue Note" or the "Note"), and loan the proceeds derived from the sale of the Revenue Note to Academy of Holy Angels, a Minnesota nonprofit organization (the "Borrower"), to finance and refinance a project comprised of: (i) the renovation of, and the construction of additions to, the Academy of Holy Angels High School (the "Facility") owned by the Borrower and located at 6600 Nicollet Avenue South in the City; (ii) the acquisition and installation of equipment in the Facility; and (iii) the refunding of outstanding indebtedness of the Borrower previously incurred to finance the acquisition and betterment of the Facility (collectively, the "Project"); and WHEREAS, the Revenue Note is proposed to be purchased by Wells Fargo Bank Minnesota, National Association (the "Lender"), and the proceeds derived from the sale of the Revenue Note are proposed to be loaned to the Borrower pursuant to the terms of a Loan Agreement, dated as of December 1, 2002 (the "Loan Agreement"), between the City and the Borrower; and WHEREAS, the payment of the principal of, premium, if any, and interest on the Revenue Note will be secured by: (i) the revenues derived from the Loan Agreement to be assigned to the Lender pursuant to the terms of the Pledge Agreement, dated as of December 1, 2002 (the "Pledge Agreement"), from the City to the Lender; (ii) a Leasehold Mortgage, Security Agreement, Fixture Financing Statement and Assignment of Leases and Rents, dated as of December 1, 2002 (the "Mortgage"), executed by the Borrower, as mortgagor, in favor of the Lender, as mortgagee; and (iii) such other security as may be required from the Borrower by the Lender. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF RICHFIELD, MINNESOTA, THAT: 1. The City acknowledges, finds, determines, and declares that the issuance of the Revenue Note is authorized by the Act and is consistent with the purposes of the Act and that the issuance of the • Note and the other actions of the City under the Loan Agreement and this resolution constitute a public purpose and are in the best interests of the City. • 2. For the purposes set forth above, there is hereby authorized the issuance, sale and delivery of the Note in the principal amount not to exceed $8,540,000. The Note shall bear interest, shall be numbered, shall be dated, shall mature, shall be subject to redemption prior to maturity, shall be in such form, and shall have such other terms, details, and provisions as are prescribed in the form of Revenue Note now on file with the City and in the form of the Loan Agreement now on file with the City. The City hereby authorizes the Revenue Note to be issued as a "tax-exempt bond" the interest on which is not includable in gross income for federal and State of Minnesota income tax purposes. All of the provisions of the Revenue Note, when executed as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Revenue Note shall be substantially in the form on file with the City, which is hereby approved, with such necessary and appropriate variations, omissions and insertions (including changes to the principal amount of the Revenue Note, the determination of the initial interest rate on the Note, and changes to the terms of redemption of the Note) as the Mayor and City Manager of the City (the "Mayor" and "City Manager," respectively), in their discretion shall determine. The execution of the Revenue Note with the manual or facsimile signatures of the Mayor and the City Manager and the delivery of the Revenue Note by the City shall be conclusive evidence of such determination. 3. The Revenue Note shall be a special obligation of the City payable by the City solely from the revenues derived by the City from the Loan Agreement, assigned to the Lender pursuant to the Pledge Agreement, and from other security provided by the Borrower including the Mortgage. 4. The City hereby authorizes and directs the Mayor and the City Manager to execute and . deliver the Loan Agreement and the Pledge Agreement in the forms now on file with the City. All of the provisions of the Loan Agreement and the Pledge Agreement when executed as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Loan Agreement and the Pledge Agreement shall be substantially in the forms now on file with the City, which are hereby approved, with such necessary and appropriate variations, omissions and insertions as the Mayor and the City Manager in their discretion shall determine. The execution of the Loan Agreement and the Pledge Agreement with the manual or facsimile signatures of the Mayor and the City Manager and the delivery of the Loan Agreement and the Pledge Agreement by the City shall be conclusive evidence of such determination. 5. The Revenue Note shall be a revenue obligation of the City the proceeds of which shall be disbursed pursuant to the Loan Agreement, and the principal, premium, and interest on the Revenue Note shall be payable solely from the proceeds of the Revenue Note, the revenues derived from the Loan Agreement, and the other sources set forth in the Loan Agreement. 6. The Mayor and the City Manager of the City are hereby authorized to execute and deliver, on behalf of the City, such other instruments, certificates, and documents as are necessary or appropriate in connection with the issuance, sale, and delivery of the Note, including the City Tax Certificate, the Information Return for Tax-Exempt Private Activity Bond Issues, Form 8038, and all other instruments, certificates, and documents which are requested by the Borrower or the Lender to be executed and delivered by the City in connection with the issuance, sale, and delivery of the Revenue Note and which Kennedy & Graven, Chartered, as bond counsel or the City Attorney, deems necessary or appropriate. The City hereby authorizes Kennedy & Graven, Chartered, as bond counsel of the City, to • prepare, execute, and deliver its approving legal opinion with respect to the Revenue Note. 2 • 7. All covenants, stipulations, obligations, and agreements of the City contained in this resolution and the aforementioned documents shall be deemed to be the covenants, stipulations, obligations, and agreements of the City to the full extent authorized or permitted by law, and all such covenants, stipulations, obligations, and agreements shall be binding upon the City. Except as otherwise provided in this resolution, all rights, powers and privileges conferred and duties and liabilities imposed upon the City or the City Council of the City by the provisions of this resolution or of the aforementioned documents shall be exercised or performed by the City or by such members of the City Council, or such officers, board, body or agency thereof as may be required or authorized by law to exercise such powers and to perform such duties. No covenant, stipulation, obligation or agreement herein contained or contained in the aforementioned documents shall be deemed to be a covenant, stipulation, obligation or agreement of any member of the City Council of the City, or any officer, agent or employee of the City in that person's individual capacity, and neither the City Council nor any officer or employee executing the Revenue Note shall be liable personally on the Revenue Note or be subject to any personal liability or accountability by reason of the issuance thereof. No provision, covenant or agreement contained in the aforementioned documents, the Revenue Note or in any other document relating to the Revenue Note, and no obligation therein or herein imposed upon the City or the breach thereof, shall constitute or give rise to any pecuniary liability of the City or any charge upon its general credit or taxing powers. In making the agreements, provisions, covenants and representations set forth in such documents, the City has not obligated itself to pay or remit any funds or revenues, other than funds and revenues derived from the Loan Agreement which are to be applied to the payment of the Note, as provided therein and in the Loan Agreement. . 8. Except as herein otherwise expressly provided, nothing in this resolution or in the aforementioned documents expressed or implied, is intended or shall be construed to confer upon any person or firm, other than the City, the Borrower, and the Lender or any other holder of the Revenue Note issued under the provisions of this resolution, any right, remedy or claim, legal or equitable, under and by reason of this resolution or any provisions hereof, this resolution, the aforementioned documents and all of their provisions being intended to be and being for the sole and exclusive benefit of the City, the Borrower, the Lender, and any other holder from time to time of the Revenue Note issued under the provisions of this resolution. 9. In case any one or more of the provisions of this resolution, other than the provisions contained in Section 3 hereof, or of the aforementioned documents, or of the Revenue Note issued hereunder shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of this resolution, or of the aforementioned documents, or of the Revenue Note, but this resolution, the aforementioned documents, and the Revenue Note shall be construed and endorsed as if such illegal or invalid provisions had not been contained therein. 10. The Revenue Note, when executed and delivered, shall contain a recital that it is issued pursuant to the Act, and such recital shall be conclusive evidence of the validity of the Revenue Note and the regularity of the issuance thereof, and that all acts, conditions, and things required by the laws of the State of Minnesota relating to the adoption of this resolution, to the issuance of the Revenue Note, and to the execution of the aforementioned documents to happen, exist and be performed precedent to the execution of the aforementioned documents have happened, exist and have been performed as so required by law. • 11. The officers of the City, bond counsel and other attorneys, and other agents or employees of the City are hereby authorized to do all acts and things required of them by or in connection with this • resolution, the aforementioned documents, and the Revenue Note for the full, punctual and complete performance of all the terms, covenants and agreements contained in the Revenue Note, the aforementioned documents and this resolution. In the event that for any reason the Mayor of the City is unable to carry out the execution of any of the documents or other acts provided herein, any person delegated the authority to execute documents in the absence or incapacity of the Mayor is hereby authorized to act in the capacity of the Mayor and undertake such execution or acts on behalf of the City with full force and effect, which execution or acts shall be valid and binding on the City. If for any reason the City Manager of the City is unable to execute and deliver the documents referred to in this Resolution, such documents may be executed by any person delegated the authority to execute documents in the absence or incapacity of the City Manager, with the same force and effect as if such documents were executed and delivered by the City Manager of the City. 12. The Borrower will pay the administrative fees of the City as set forth in the Loan Agreement and pay, or upon demand, reimburse the City for payment of, any and all costs and expenses paid or incurred by the City in connection with the Project and the issuance of the Revenue Note, whether or not the Revenue Note is issued. 13. The City hereby designates the Revenue Note as a "qualified tax-exempt obligation" for purposes of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code"), and represents that the City does not reasonably anticipate that the City will issue in calendar year 2002 more than $10,000,000 of bonds or other tax-exempt obligations (excluding "private activity bonds" other than "qualified 501(c)(3) bonds," as such terms are defined in the Code, and excluding certain refunding obligations, that are not included in the $10,000,000 limitation set forth in Section 265(b)(3)(C)(i) of the Code). • 14. This resolution shall be in full force and effect from and after its passage. (The remainder of this page is intentionally left blank.) • 4 • Adopted by the City of Richfield, Minnesota, this 10th day of December, 2002. Mayor Attest: City Clerk r~ • ~stSecond Draft ,Tuesday, December 3, 2002 UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN City of Richfield, Minnesota Educational Facilities Revenue Note (Academy of Holy Angels Project) Series 2002 R-1 $8,540,000 The City of Richfield, Minnesota (the "City") hereby promises to pay to Wells Fargo Bank Minnesota, National Association, a national banking association, or its successors or registered assigns (the "Lender"), solely from the source and in the manner hereinafter provided, the principal sum of Eight Million Five Hundred Forty Thousand Dollars ($8,540,000), or so much thereof as may have been advanced to or for the benefit of the City and remains unpaid from time to time (the "Principal Balance"), with interest thereon as set forth in Paragraph 2 below from December ~ 2002 (the "Date of Issue"), until December _, ~L2023 (the "Maturity Date"), or until earlier paid or otherwise discharged, in any coin or currency which at the time or times of payment is legal tender for the payment of public or private debts in the United States of America, in accordance with the terms hereinafter set forth. • 1. This Educational Facilities Revenue Note (Academy of Holy Angels Project), Series 2002 (the "Note") is issued by the City pursuant to authority conferred by Minnesota Statutes, Sections 469.152 to 469.1651, as amended (the "Act") and Resolution No. ,adopted by the City Council of the City on December 10, 2002 (the "Resolution"), to provide funds for a project, as defined in Section 469.152, subdivision 2(b) of the Act, consisting of the renovation and equipping of, and the construction of additions to, and the refinancing of certain existing indebtedness with respect to the non- religious portions of a school for grades nine through twelve known as Academy of Holy Angels High School, owned and operated by the Academy of Holy Angels, a Minnesota nonprofit corporation (the "Borrower"), and located at 6600 Nicollet Avenue South in the City. The proceeds derived from the sale of the Note are to be loaned to the Borrower pursuant to the terms of a Loan Agreement, dated December 1, 2002 (the "Loan Agreement"), between the City and the Borrower. The interests of the City in the Loan Agreement have been assigned to the Lender (except for certain rights to the payment of fees and expenses and rights to indemnification) pursuant to the terms of a Pledge Agreement, dated as of December 1, 2002 (the "Pledge Agreement"), between the City and the Lender. 2. This Note shall bear interest at a variable rate. equal to ftk~s-4-A9-perse~}~sixty-seven percent 6( 7%) of the {daily}~tla~+} LIBOR plus 2.00 percent} the "Daily"1 from the Date of Issue to the Maturity Date. Interest shall accrue and be calculated on the basis of actual days elapsed in a year of 365/366 days. "LIBOR" has the meaning given to the term "USD LIBOR-BBA" in the 1992 ISDA U.S. Municipal Counterparty Definitions, as published by the International Swap and Derivatives Associations, Inc. The interest rate on this Note shall be adjusted on each date that LIBOR is adjusted. The Borrower may, upon written notice to the City and the Lender, • thirty-day LIBOR plus 2.00 percent (the "Monthly Rate"). The Borrower may convert interest rate on this Note to the Daily Rate or the Monthl~Rate as set forth herein on any L 3. Interest only shall be payable on this Note on January _, 2003, and on the day of each month thereafter until the Completion Date (as hereinafter defined). The "Completion Date" is the earlier of: (i) the date of substantial completion of the Project, as determined in accordance with the terms of the Loan Agreement; or (ii) the first anniversary of the Date of Issue. From the Completion Date this Note shall be payable in 240 monthly installments of principal and interest sufficient to fully and equally amortize repayment thereof based upon a twenty (20) year amortization commencing on the day of the month following the month in which the Completion Date occurs and continuing on the same day of each and every month thereafter until the last payment, at which time the Principal Balance plus accrued and unpaid interest, if any, shall be due and payable in full. Payments shall be applied first to interest due on the Principal Balance and thereafter to reduction of the Principal Balance. 4. If the Borrower fails to provide financial statements or other financial information or documentation as required by the Loan Agreement and such failure continues after ten (10) days written notice thereof from the Lender to the Borrower, then the Lender shall have the option, upon prior written notice to the Borrower, of increasing the rate of interest due on this Note for the balance of the term by one-half percent (.5%) per annum (which increase shall be in addition to any other increase as specified herein) and declaring such failure to provide financial statements or other financial information or documentation an Event of Default (as defined in the Loan Agreement). 5. As required by the Loan Agreement, until such time as this Note is fully paid and so long as Wells Fargo Bank Minnesota, National Association is the Lender, the Borrower is required by the Loan Agreement to maintain al}the primary depository accounts of the Borrower'~'~~~'~ ~~ ~~~~*~ with Wells Fargo Bank Minnesota, National Association or an affiliate thereof. If the Borrower fails to so maintain all-such primary depositor accounts with the Lender or an affiliate of the Lender as required by the Loan Agreement, then the Lender shall have the option, upon prior written notice to the Borrower, of increasing the rate of interest on this Note by an additional one-half percent (.5%) per annum for the balance of the term of this Note (which increase shall be in addition to any other increase as specified herein) and/or declaring such failure to constitute an Event of Default. 6. Upon a Determination of Taxability (as defined in the Loan Agreement), the interest rate on this Note shall be increased by an additional two percent X2.00%) per annum from and after the Date of Taxability (as defined in the Loan Agreement). Any accrued and unpaid interest as a result of such Determination of Taxability shall be paid to the Lender within thirty (30) days of the Determination of Taxability. 7. Principal and interest and premium or service charge, if any, due hereunder shall be payable at the principal office of the Lender, or at such other place as the Lender may designate in writing. If any installment of principal or interest on this Note is not paid within ten (10) days of the due date thereof, an additional late charge shall be immediately due and payable in an amount equal to five percent (5%) of the amount of the installment of principal, interest, premium, and service charge then due and remaining unpaid. 8. This Note is subject to optional tender in whole by the Lender to the Borrower on December 1, 2012 (the "Purchase Date") upon ~~~et~-E9~180 days written notice by the Lender to the Borrower. Pursuant to the Loan Agreement, if this Note is tendered on any Purchase Date, the Borrower has agreed to purchase it at the then outstanding Principal Balance on such applicable Purchase Date, plus all accrued and unpaid interest, without premium. 9. This Note shall be prepaid, in whole or in part, from the proceeds of any loan prepayment made by the Borrower pursuant to Section 5.1 of the Loan Agreement. Under the terms of the Loan Agreement, the Borrower may prepay the Loan (as defined in the Loan Agreement), at any time in whole or in part, without penalty. Notice of any such prepayment of this Note shall be given to the Lender by first-class mail, addressed to the Lender at its registered address, not less than thirty (30) days prior to the date fixed for prepayment. In the event of a prepayment of this Note, the Lender shall apply any such prepayment first against accrued interest on the Principal Balance and second against the Principal Balance of this Note. At the date -fixed for prepayment; funds shall be paid to the Lender at its registered address. 10. This Note is secured by a Pledge Agreement, dated as of December 1, 2002 (the "Pledge Agreement"), between the City and the Lender, and is further secured by a Leasehold Mortgage, Security Agreement, Fixture Financing Statement and Assignment of Leases and Rents, dated as of December 1, 2002 (the "Mortgage"), executed by the Borrower, as mortgagor, in favor of the Lender, as mortgagee, and by a Security Agreement, dated as of December 1, 2002 (the "Security Agreement"), between the Borrower and the Lender, as secured party. The disbursement of the proceeds of this Note is subject to the terms and conditions of the Loan Agreement and a Disbursing Agreement, dated as of December 1, 2002 (the "Disbursing Agreement"), between the Lender-~1_ the Borrower and Commonwealth Land Title Insurance Company. 11. The City, for itself, its successors and assigns, hereby waives demand, presentment, • protest and notice of dishonor. To the extent permitted by the Act and other applicable law, whether or not as a result thereof the interest on this Note becomes includable in gross income for federal income tax purposes or becomes includable in net taxable income for State of Minnesota income tax purposes, the Lender may, without notice to or consent of any party liable hereon or thereon and without releasing any such party from such liability: (i) extend the date for the payment of any principal, premium, service charge, or interest with respect to this Note; or (ii) release any property or any portion of any property subject to the Mortgage, the Pledge Agreement, the Security Agreement, or any other security document. In no event, however, may the Maturity Date of this Note be extended beyond thirty (30) years from the Date of Issue. 12. Upon the occurrence of certain Events of Default, as defined in the Loan Agreement and Mortgage, the Lender may declare the Principal Balance and accrued interest on the Note to be immediately due and payable. 13. As provided in the Resolution and subject to certain limitations set forth therein, this Note is only transferable upon the books of the City at the office of the City~l~, by the Lender in person or by its agent duly authorized in writing, at the Lender's expense, upon surrender hereof together with a written instrument of transfer satisfactory to the City Manager, duly executed by the Lender or its duly authorized agent. Upon such transfer the City Manager will note the date of registration and the name and address of the new registered owner in the registration blank appearing below. The City may deem and treat the person in whose name the Note is last registered upon the books of the City with such registration noted on the Note, as the absolute owner hereof, whether or not overdue, for the purpose of receiving payment, or on the account, of the Principal Balance, redemption price or interest and for all other purposes, and all such payments so made to the Lender or upon the Lender's order shall • be valid and effective to satisfy and discharge the liability upon the Note to the extent of the sum or sums so paid, and the City shall not be affected by any notice to the contrary. 14. All of the agreements, conditions, covenants, provisions and stipulations contained in the Resolution, the Loan Agreement, the Mortgage, Pledge Agreement, and the Security Agreement are hereby made a part of this Note to the same extent and with the same force and effect as if they were fully set forth herein. 15. This Note and interest thereon and any service charge or premium, if any, due hereunder are payable solely from the revenues and proceeds derived from the Loan Agreement, the Mortgage, the Pledge Agreement, and the Security Agreement and do not constitute a debt of the City within the meaning of any constitutional or statutory limitation, are not payable from or a charge upon any funds other than the revenues and proceeds pledged to the payment thereof, and do not give rise to a pecuniary liability of the City or any of its officers, agents or employees, and no holder of this Note shall ever have the right to compel any exercise of the taxing power of the City to pay this Note or the interest thereon, or to enforce payment thereof against any property of the City, and this Note does not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City, and the agreement of the City to perform or cause the performance of the covenants and other provisions herein referred to shall be subject at all times to the availability of revenues or other funds furnished for such purpose in accordance with the Loan Agreement, sufficient to pay all costs of such performance or the enforcement thereof. 16. If an Event of Default (as that term is defined in the Mortgage and the Loan Agreement) shall occur, then the Lender shall have the right and option to declare, upon ten (10) days written notice, the Principal Balance and accrued interest thereon, immediately due and payable, whereupon the same, plus any premiums or service charges, shall be due and payable, but solely from sums made available under the Loan Agreement, the Mortgage, the Pledge Agreement, and the Security Agreement. Failure to exercise such option at any time shall not constitute a waiver of the right to exercise the same at any subsequent time. 17. The remedies of the Lender, as provided herein and in the Loan Agreement, the Mortgage, the Pledge Agreement, and the Security Agreement, are not exclusive and shall be cumulative and concurrent and may be pursued singly, successively or together, at the sole discretion of the Lender, and may be exercised as often as occasion therefor shall occur; and the failure to exercise any such right or remedy shall in no event be construed as a waiver or release thereof. 18. The Lender shall not be deemed, by any act of omission or commission, to have waived any of its rights or remedies hereunder unless such waiver is in writing and signed by the Lender and, then only to the extent specifically set forth in the writing. A waiver with reference to one event shall not be construed as continuing or as a bar to or waiver of any right or remedy as to a subsequent event. 19. This Note has been issued without registration under state or federal or other securities laws, pursuant to an exemption for such issuance; and accordingly this Note may not be assigned or transferred, in whole or part, nor may a participation interest in this Note be given pursuant to any participation agreement, except in accordance with an applicable exemption from such registration requirements. The City acknowledges that the Lender may enter into a participation agreement with one or more sophisticated investors. 20. The City has designated this Note as a "qualified tax exempt obligation" pursuant to Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. • • It is hereby certified and recited that all conditions, acts, and things required to exist, to happen, and to be performed precedent to or in the issuance of this Note do exist, have happened, and have been performed in regular and due form as required by law. • • • In witness whereof, the City has caused this Note to be duly executed in its name by the manual or facsimile signatures of the Mayor and City Manager, the corporate seal having been intentionally omitted as permitted by law. r1 CITY OF RICHFIELD, MINNESOTA By Its Mayor By Its City Manager • • NOTE REGISTER The ownership of the unpaid Principal Balance of this Note and the interest accruing thereon is registered on the books of the City of Richfield, Minnesota in the name of the holder last noted below. Date of Registration Name and Address Registered Owner Signature of City Manager December _, 2002 RC145-502 (JU) 223770v.~3 Wel~Wells Fargo Bank Minnesota, National Association MAC N9117-031 430 North Wabasha Street Suite 302 Saint Paul, Minnesota 55101 NR-1 . ~stSecond Draft ,Tuesday, December 3, 2002 LOAN AGREEMENT between CITY OF RICHFIELD, MINNESOTA and ACADEMY OF HOLY ANGELS Dated as of December 1, 2002 Except for certain reserved rights, the interest of the City of Richfield, Minnesota, in this Loan Agreement has been pledged and assigned to Wells Fargo Bank Minnesota, National Association, pursuant to a Pledge Agreement of even date herewith. This instrument drafted by: Kennedy & Graven, Chartered (JU) 470 Pillsbury Center 200 South Sixth Street Minneapolis, Minnesota 55402-1458 • TABLE OF CONTENTS Page ARTICLE 1 DEFINITIONS, EXHIBITS AND RULES OF INTERPRETATION ................................1 Section 1.1 Definitions ....................................................................................................................1 Section 1.2 Rules of Interpretation ..................................................................................................3 ARTICLE 2 REPRESENTATIONS ........................................................................................................5 Section 2.1 Representations by the City ..........................................................................................5 Section 2.2 Representations by the Borrower ....::.......:.....::..............:..:...........:....:...:......................6 ARTICLE 3 THE LOAN .................................................................................................................:.......9 Section 3.1 Amount and Source of Loan ....................................................................................... ..9 Section 3.2 Documents Required Prior to Disbursement of the Loan ........................................... ..9 Section 3.3 Disbursement of the Loan ........................................................................................... ..9 Section 3.4 Repayment .................................................................................................................. 10 Section 3.5 Borrower's Obligations Unconditional ....................................................................... 10 Section 3.6 City's Administrative Fee ........................................................................................... 10 ARTICLE 4 BORROWER'S COVENANTS ........................................................................................ 12 Section 4.1 Indemnity .................................................................................................................... 12 Section 4.2 Continuing Existence and Qualification ..................................................................... 12 Section 4.3 Section 4.4 Reports to Governmental Agencies ............................................................................ Security for the Loan .................................................................................................. 13 13 Section 4.5 Preservation of Tax Exemption .................................................................................. 13 Section 4.6 Lease or Sale of Project .............................................................................................. 16 Section 4.7 Project Operation and Maintenance Expenses ............................................................ 16 Section 4.8 Notification of Changes .............................................................................................. 16 Section 4.9 Additional Covenants ................................................................................................. 17 ARTICLE 5 PREPAYMENT OF LOAN ..............................................................................................21 Section 5.1 Prepayment at Option of Borrower .............................................................................21 ARTICLE 6 EVENTS OF DEFAULT AND REMEDIES ....................................................................22 Section 6.1 Events of Default ....................................................................................................... .22 Section 6.2 Remedies .................................................................................................................... .23 Section 6.3 Disposition of Funds .................................................................................................. .23 Section 6.4 Manner of Exercise .....................................................................................................23 Section 6.5 Attorneys' Fees and Expenses ....................................................................................23 Section 6.6 Effect of Waiver ..........................................................................................................24 ARTICLE 7 GENERAL ........................................................................................................................ 25 Section 7.1 Notices ........................................................................................................................ 25 Section 7.2 Binding Effect ............................................................................................................. 25 Section 7.3 Severability ................................................................................................................. 25 Section 7.4 Amendments, Changes and Modifications ................................................................. 25 Section 7.5 Execution Counterparts ............................................................................................... 25 Section 7.6 Limitation of City's Liability ...................................................................................... 25 Section 7.7 City's Attorneys Fees and Costs .........................................................................:....... 26 • Section 7.8 Release ........................................................................................................................26 Section 7.9 Assignment by City and Survivorship of Obligations ................................................26 Section 7.10 Required Approvals ....................................................................................................27 Section 7.11 Termination Upon Retirement of Note .......................................................................27 Section 7.12 Lender's Attorneys' Fees and Costs ...........................................................................27 SIGNATURES .......................................................................................................................................... ~- .] • ii • LOAN AGREEMENT This Loan Agreement, dated as of December 1, 2002 (the "Agreement"), is made and entered into between the City of Richfield, Minnesota, a municipal corporation and political subdivision of the State of Minnesota (the "City") and Academy of Holy Angels, a Minnesota nonprofit corporation (the "Borrower"). The City and the Borrower each in consideration of the representations, covenants and agreements of the other as set forth herein, mutually represent, covenant and agree as follows: ARTICLE 1 DEFINITIONS, E~II3IBITS AND RULES OF INTERPRETATION Section 1.1. Definitions. In this Agreement the following terms have the following respective meanings unless the context hereof clearly requires otherwise: Act: Minnesota Statutes, Sections 469.152 to 469.165, as amended. Agreement: this Loan Agreement between the City and the Borrower as the same may from time to time be amended or supplemented as herein provided. • Bond Counsel: the firm of Kennedy & Graven, Chartered; Minneapolis, Minnesota (any opinion of Bond Counsel shall be a written opinion signed by Bond Counsel). Borrower: Academy of Holy Angels, a Minnesota nonprofit corporation, its successors and assigns, and any surviving, resulting or transferee business entity which may assume its obligations in accordance with the provisions of this Agreement. Cam: the City of Richfield, Minnesota, its successors and assigns. Closing: the date of physical delivery of the Note to the Lender. Code: the Internal Revenue Code of 1986, as amended, and the temporary, final or proposed regulations promulgated thereunder. Completion Date: the earlier of the date on which the construction is substantially complete, as evidenced by a certificate of the Borrower, or December _, 2003 (provided that if the Lender shall extend any such date in writing, then the Completion Date shall be such later date). Counsel: an attorney designated by or acceptable to the Lender, duly admitted to practice law before the highest court of any state; an attorney for the Borrower or the City may be eligible for appointment as Counsel. . Date of Taxability: shall have the meaning ascribed to it in Section 4.5(2) hereof; Determination of Taxability: shall have the meaning ascribed to it in Section 4.5(2) hereof; Disbursing Agent: Commonwealth Land Title Insurance Company, its successors and assigns. Disbursing Agreement: the Disbursing Agreement, dated as of December 1, 2002, by and between the Lender, the Borrower, and the Disbursing Agent, relating to the disbursement of the proceeds of the Note. Equipment: any and .all machinery, equipment, furniture and other tangible personal property purchased or to be purchased by the Borrower with the proceeds of the Loan and all replacements and substitutions therefore; Event of Default: any of the events described in Section 6.1 hereof; Exempt Organization: an organization that is exempt from federal income taxation pursuant to Section 501(a) of the Code as a result of the application of Section 501(c)(3) of the Code. ~e~e~e~ts~ ~~e~ e'~S '1' '~eye~e~~S"' ' ' ~ t C o i ~ Tiis j ~ a 1 Z ~t3t3~T~e~.~ o 87i~.S i~3~ ui CtYYigS, ~~F. RR 'Pt3~~T ~ , 1 f 7 Issuance Expenses: shall mean any and all costs and expenses relating to the issuance, sale, and delivery of the Note, including, but not limited to, any fees of the Lender, all fees and expenses of legal counsel, financial consultants, feasibility consultants and accountants, any fee to be paid to the City, the cost of preparation and printing of this Agreement, the Mortgage, the Security Agreement, the Resolution, the Pledge Agreement, the Note, and all other related documents, and all other expenses relating to the issuance, sale and delivery of the Note and any other costs which are treated as "issuance costs" within the meaning of Section 147(g) of the Code. Land: the real property and any other easements and rights described in Exhibit A to the Mortgage. Lender: Wells Fargo Bank Minnesota, National Association, a Minnesota corporation, its successors and assigns. Loan: the loan of Note proceeds from the City to the Borrower described in Section 3.1 hereof. Mort~a~e: the Leasehold Mortgage, Security Agreement, Fixture Financing Statement and Assignment of Leases and Rents, dated as of December 1, 2002, executed by Borrower, as mortgagor, in favor of Lender, as mortgagee, securing the Note and any amendments thereto;_ Note: the Educational Facilities Revenue Note (Academy of Holy Angels Project), Series 2002, issued by the City in the original aggregate principal amount of $8,540,000. Optional Tender: the right of the Lender, as set forth in the Note, to tender the Note to the Borrower at certain times pursuant to certain notice requirements for mandatory purchase by the • Borrower at a purchase price equal to the Principal Balance thereof, together with accrued and unpaid interest. Pledge Agreement: the Pledge Agreement, dated as of December 1, 2002, between the City and the Lender pledging and assigning the City's interest in the Loan Agreement to the Lender to the extent provided therein. Principal Balance: so much of the principal sum on the Note as from time to time remains unpaid. services. the account established by the Borrower with the Lender to secure the ...,.,,a ,.«,7 ,.~L,,....,.«,.,,«t~ .7„e ..,:+L, .-o~..o..r +., +l,o TAT..+o • Resolution: Resolution No. of the City, adopted December 10, 2002, authorizing the issuance of the Note together with any supplement or amendment thereto. Security Agreement: the Security Agreement, dated as of December 1, 2002, by and between the Borrower and Lender securing the Note and any amendments thereof. State: the State of Minnesota. Treasury Regulations: all proposed, temporary or permanent federal income tax regulations then in effect and applicable. Section 1.2. Rules of Interpretation. (1) This Agreement shall be interpreted in accordance with and governed by the laws of the State of Minnesota. (2) 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 to any particular section or subdivision hereof. (3) References herein to any particular section or subdivision hereof are to the section or subdivision of this instrument as originally executed. 3 Project Costs: all direct costs authorized by the Act and paid or incurred by the Borrower, to acquire, construct, and equip the Project, including, but not limited to, interest on the Note during construction, architectural fees, engineering fees, contractor's fees and all costs of labor, material and • (4) Where the Borrower is permitted or required to do or accomplish any act or thing hereunder, the City or the Lender may cause the same to be done or accomplished with the same force and effect as if done or accomplished by the Borrower. (5) The Table of Contents and titles of articles and sections herein are for convenience only and are not a part of this Agreement. (6) Unless the context hereof clearly requires otherwise, the singular shall include the plural and vice versa and the masculine shall include the feminine and vice versa. (7) Articles, sections, subsections "and clauses mentioned by number only are those so numbered which are contained in this Agreement. (8) References to the Note as "tax exempt" or to the "tax exempt status of the Note" are to the exclusion of interest on the Note from gross income pursuant to Section 103(a) of the Code. (The remainder of this page is intentionally left blank.) r1 U 4 . ARTICLE 2 REPRESENTATIONS Section 2.1. Representations by the City. The City makes the following representations as the basis for its covenants herein: (1) The City is a municipal corporation duly organized under its Charter and the Constitution and the laws of the State of Minnesota and is authorized to issue the Note to finance the Project Costs pursuant to the Act. (2) Based solely on representations of the Borrower, the City's purpose in issuing the Note and financing and refinancing the Project is, and the effect thereof will be, to promote the public purposes set forth in the Act. (3) The Project has been approved by the Commissioner of the Trade and Economic Development of the State of Minnesota, or the Commissioner's duly delegated designee, as tending to further the purposes and policies of the Act. (4) The issuance and sale of the Note, the execution and delivery of this Agreement and the Pledge Agreement, and the performance of all covenants and agreements of the City contained in this Agreement, the Note, and the Pledge Agreement, and of all other acts and things required under the Constitution and laws of the State of Minnesota to make this Agreement, the Pledge Agreement, and Note the valid and binding obligations of the City in accordance with their terms, are authorized by the Act and . the Charter of the City and have been duly authorized by the Resolutions of the City. (5) Pursuant to the Resolution, the City has authorized and directed the Lender to disburse the proceeds of the Note directly to the Borrower and such other parties as may be entitled to payment for Project Costs, upon receipt of such supporting documentation as the Lender may deem reasonably necessary or as required by this Agreement. (6) This Agreement and the Note constitute a program investment within the meaning of Treasury Regulations Section 1.148-1 because it is part of a governmental program which: (i) involves the origination or acquisition of purpose investments (as defined in applicable Treasury Regulations); (ii) at least ninety-five percent of the cost of the purpose investments acquired under the program represents one or more loans to Exempt Organizations; (iii) at least ninety-five percent of the receipts from the purpose investments are used to pay principal, interest or redemption prices on issues that financed the program, to pay or reimburse administrative costs of those issues or of the program, to pay or reimburse anticipated future losses directly related to the program, to finance additional purpose investments for the same general purposes of the program, or to redeem and retire governmental obligations at the next earliest possible date of redemption; (iv) the program documents prohibit any obligor on a purpose investment financed by the program or any related party to that obligor from purchasing bonds of an issue that finance the program in an amount related to the amount of the purpose investment acquired from that obligor; and (v) the City has not waived the right to treat the investment as a program investment. The yield on this Agreement includes certain fees payable by the Borrower as provided herein, but does not exceed the yield on the Note by more than one and one-half percentage points. Section 2.2. Representations by the Borrower. The Borrower makes the following representations as the basis for its covenants herein: • (1) The Borrower is a Minnesota nonprofit corporation duly incorporated and in good standing under the laws of the State of Minnesota, is duly authorized to conduct its business in all states where its activities require such authorization, has power to enter into this Agreement, the Mortgage and the Security Agreement and to use the Project for the purpose set forth in this Agreement and by proper corporate action has authorized the execution and delivery of this Agreement, the Mortgage and the Security Agreement. (2) The Borrower is an Exempt Organization. The Borrower is not a "private foundation" as defined in Section 509(a) of the Code. Not more than five percent (5%) of the proceeds of the Note will be used, directly or indirectly, to finance or refinance property used in an unrelated trade or business of the Borrower determined by applying-Section 513(c) of the Code or in the trade or business of any person other than an Exempt Organization. There is no action, proceeding or investigation pending or threatened by the Internal Revenue Service or authorities of the State of Minnesota which, if adversely determined, might result in a modification of the status of the Borrower as an Exempt Organization. (3) The execution and delivery of this Agreement, the Mortgage and the Security Agreement, the consummation of the transactions contemplated thereby, and the fulfillment of the terms and conditions thereof do not and will not conflict with or result in a breach of any of the terms or conditions of the Borrower's articles of incorporation, its bylaws, any restriction or any agreement or instrument to which the Borrower is now a party or by which it is bound or to which any property of the Borrower is subject, and do not and will not constitute a default under any of the foregoing or a violation of any order, decree, statute, rule or regulation of any court or of any state or federal regulatory body having jurisdiction over the Borrower or its properties, including the Project, and do not and will not result in the creation or imposition of any lien, charge or encumbrance of any nature upon any of the property or assets of the Borrower contrary to the terms of any instrument or agreement to which the Borrower is a party or by which it is bound. (4) The use of the Project as designed and proposed to be operated complies, in all. material respects, with all presently applicable development, pollution control, water conservation and other laws, regulations, rules and ordinances of the federal government and the State of Minnesota and the respective agencies thereof and the political subdivisions in which the Project is located. The Borrower has obtained, or will obtain in a timely manner, all necessary and material approvals of and licenses, permits, consents and franchises from federal, state, City, municipal or other governmental authorities having jurisdiction over the Project to acquire, construct, install, and operate the Project and to enter into, execute and perform its obligations under this Agreement, the Mortgage and the Security Agreement; and no violation of any local ordinance, laws, regulation or requirement exists with respect to the Land. (5) The proceeds of the Note, together with any other ~uity funds and borrowed funds to be contributed to the Project by the Borrower or otherwise in accordance with this Agreement, will be sufficient to pay the cost of the Project in a manner suitable for its use, and all costs and expenses incidental thereto, and the proceeds of the Note will be used only for the purposes contemplated hereby and allowable under the Act. (6) As of the original date hereof, comparable private financing for the Project was not found by the Borrower to be reasonably available, and the Project is economically more feasible with the availability of the financing herein authorized. (7) The Borrower is not in the trade or business of selling properties such as the Project and is undertaking the Project for use by the Borrower in the activities for which the Borrower was determined to be an Exempt Organization. The Borrower has no intention now or in the foreseeable future to voluntarily sell, surrender or otherwise transfer, in whole or part, its interest in the Project. (8) There are no actions, suits, or proceedings pending or, to the knowledge of the Borrower, threatened against or affecting the Borrower or any property of the Borrower in any court or before any federal, state, municipal or other governmental agency, which, if decided adversely to the Borrower would have a material adverse effect upon the Borrower or upon the business or properties of the Borrower; and the Borrower is not in default with respect to any order of any court or governmental agency. (9) The Borrower is not in default in the payment of the principal of or interest on any indebtedness for borrowed money nor in default under any instrument or agreement under and subject to which any indebtedness for borrowed money has been issued. (10) The Borrower has filed all federal and state income tax returns which, to the knowledge of the officers of the Borrower, are required to be filed and has paid all taxes shown on said returns and all assessments and governmental charges received by the Borrower to the extent that they have become due. (11) No public official of the City has either a direct or indirect financial interest in this Agreement nor will any public official either directly or indirectly benefit financially from this Agreement. (12) The Borrower has approved the terms and conditions of the Note. (13) The financial information supplied to the Lender truly and completely discloses the financial condition of the Borrower as of the date of such information, and there have been no material adverse changes in the financial condition of the Borrower subsequent to the date of the most recent financial statement supplied to Lender. (14) This Agreement, the Mortgage, the Security Agreement and the documents and. agreements relating to the foregoing, when executed and delivered by the Borrower, constitute legal, valid and binding obligations of the Borrower, enforceable against the Borrower in accordance with their respective terms (subject, as to enforceability, to limitations resulting from bankruptcy, insolvency, and other similar laws affecting creditors' rights generally). (15) No proceeds of the Note will be used to finance portions of the Project used for any religious purpose. (16) For so long as the Note is outstanding: (a) the Borrower shall not impose any qualifications related to religious beliefs on any of its teaching faculty or staff and shall not consider an applicant's religious beliefs when hiring teaching faculty or staff (except to the extent based on a bona fide occupational qualification); (b) the Borrower's core curriculum shall include instruction in subjects and in a manner generally consistent with the compulsory instruction report issued by the Minnesota Department of Children, Families and Learning; (c) the Borrower shall maintain a policy for the Project of open enrollment of students without regard to race, religion, color, sex or national or ethnic origin and a policy of hiring of faculty and staff without regard to race, religion, color, sex or national or ethnic origin; and 7 (d) the Borrower shall not require students to participate in religious services. (17) The Borrower agrees that the foregoing representations and warranties shall be continuing in nature and shall remain in full force and effect until such time as the Loan shall be paid in full. (The remainder of this page is intentionally left blank.) • ARTICLE 3 THE LOAN Section 3.1. Amount and Source of Loan. The City has authorized the issuance of the Note in the aggregate principal amount of up to $8,540,000, or such lesser amount as is determined prior to the initial issuance of the Note, to provide funds to the Borrower for its use in the acquisition, construction and equipping of the Project. The City agrees to lend the Borrower, upon the terms and conditions set forth herein, the proceeds received from the Note by causing such sums to be applied and disbursed in accordance with the provisions of this Agreement. Forthwith upon the execution and delivery of this Agreement and all other documents and instruments necessary to the transactions contemplated hereby and the recording and filing of such documents as may be required to be filed or recorded by the Lender or Bond Counsel, the City will execute the Note and cause it to be delivered to the Lender. Section 3.2. Documents Required Prior to Disbursement of the Loan. Prior to any advance of Note proceeds, the Borrower shall deliver to the Lender the following: (i) the Note; (ii) the Loan Agreement; (iii) the Pledge Agreement; (iv) the Mortgage; (v) the Security Agreement; and (vi) the opinion of Bond Counsel to the effect that the City has duly authorized the Note and that the interest thereon is exempt from federal income taxation and subject to other conditions acceptable to the Lender. Section 3.3. Disbursement of the Loan. Pursuant to this Agreement and the Act, the City has authorized the Borrower to provide directly for the acquisition, construction and equipping of the Project and payment of interest on the Note during construction in such manner as determined by the Borrower and hereby authorizes the Lender to advance the proceeds of the Note directly to the Borrower to be disbursed for the payment of Project Costs. Advances of this Loan shall be made pursuant to draw requests as set forth in the Disbursing Agreement; provided,'-°--~°-~°~, +'-° .........-r---~---., _.............,_ ...... ~.,.~..~_.. __....., ------- ---- ~__~_ ~.,..-- --a---------- ------ r-.,..~_.., _~...._., however, that each draw request for this Loan shall also contain the certification that all Project Costs to be paid or reimbursed from such advance are eligible costs under the Act and are not attributable to any portion of the Project used for religious purposes. The Completion Date for the Project shall be determined as set forth in the definition thereof in Section 1.1 hereof. Section 3.4. Repayment. Subject to the prepayment provisions set forth in the Note, the Borrower agrees to repay the Loan by making all payments of principal, interest and any premium, penalty or charge that are required to be made by the City under the Note at the times and in the amounts provided therein. In addition, the Borrower agrees to pay the purchase price of the Note when due upon an Option Tender meeting the requirements set forth in the Note. All payments shall be made directly to the Lender at its principal office for the account of the City. The Borrower represents and covenants that the source of payment of the Note is from revenues derived from the operation of the Project and other amounts available to the Borrower. Section 3.5. Borrower's Obligations Unconditional. All payments required of the Borrower hereunder shall be paid without notice or demand and without setoff, counterclaim, abatement, deduction or defense. The Borrower will not suspend or discontinue any payments, and will perform and observe all of its other agreements in this Agreement, and, except as expressly permitted herein, will not terminate this Agreement for any cause, including but not limited to any acts or circumstances that may constitute . failure of consideration, destruction or damage to the Project, eviction by paramount title, commercial frustration of purpose, bankruptcy or insolvency of the City or the Lender, change in the tax or other laws or administrative rulings or actions of the United States of America or of the State of Minnesota or any 9 political subdivision thereof, or failure of the City to perform and observe any agreement, whether express or implied, or any duty, liability or obligation arising out of or connected with this Agreement. Section 3.6. Citv's Administrative Fee. On the date of Closing and on each anniversary of the Closing, the Borrower shall pay to the City an administrative fee in an amount equal to one-eighth (1/8) of one percent of the Principal Balance of the Note as of each such date. ~ t ~ ~ ~,,.,t~ n..,,t:~:°a~ Q ~++,, co,.+:,.~ ~~ci>,vt ~ ,.~+t,o r„ao „ +>,o „ e ,.~ A6 i6ir - . S cc » > cc > », cc > », > > > cc » „+t,e,. +t, ,.., «,. ,,,,t:a: .,a cnt i„v~ ~ t.,..,a~»~ . ,:tt ,,,.+ e oo a Qt n n > nn nnn : > ~ +t,e ~ ..to~ a.,...,o..,. » « » > > > > cc » cc » cc i « „. ~r~~~:~t ~a..:~~r ~>,~tt ~~ ~~~t (The remainder of this page is intentionally left blank.) • 10 ARTICLE 4 BORROWER'S COVENANTS Section 4.1. Indemnity. The Borrower will, to the extent permitted by law, pay, and will protect, indemnify and save the City, its officers, agents and employees harmless from and against all liabilities, losses, damages, costs, expenses (including attorneys' fees and expenses), causes of action, suits, claims, demands and judgments of any nature arising from: (1) any injury to or-death of any person or damage to property in or upon-the Project or growing out of or connected with the use, non-use, condition or occupancy of the Project or a part thereof; (2) violation of any agreement or condition of this Agreement, except by the City or its assignee; (3) violation of any contract, agreement or restriction by the Borrower relating to the Project; (4) violation of any law, ordinance or regulation affecting the Project or a part thereof or the ownership, occupancy or use thereof, or arising out of this Agreement, the Note or the transactions contemplated thereby, including any requirements imposed on the Lender as a financial institution or any disclosure or registration requirements imposed by any federal or state securities law; and (5) any statement or information relating to the expenditure of the proceeds of the Note contained in the non-arbitrage certificate or similar document furnished by the Borrower to the City which, at the time made, is misleading, untrue or incorrect in any material respect. Section 4.2. Continuing Existence and Qualification. Throughout the term of this Agreement the Borrower will remain duly qualified to do business as a nonprofit corporation in the State, and will continue to operate as an Exempt Organization, and will maintain its corporate existence, will not dissolve or otherwise dispose of all or substantially all of its assets, and will not consolidate with or merge into another corporation or other business entity or permit any other corporation or other business entity to consolidate with or merge into it unless the Lender has consented to such actions and: (1) the surviving, resulting or transferee corporation, or other business entity, as the case may be, shall be a nonprofit corporation operating under the laws of the United States, any state or the District of Columbia, and an Exempt Organization (provided the Project will not constitute an unrelated trade or business within the meaning of Section 513(e) of the Code) or a governmental unit under Section 145 of the Code; (2) the surviving, resulting, or transferee corporation, or other business entity, as the case may be, if other than the Borrower, assumes in writing all of the obligations of the Borrower under this Agreement, the Mortgage and the Security Agreement and shall deliver that instrument to the Lender; and (3) the surviving, resulting or transferee corporation or other business entity, as the case may be, is duly qualified to do business in Minnesota. Every surviving, resulting or transferee corporation and other entity referred to in this Section 4.2 shall be bound by all of the covenants and agreements of the Borrower herein with respect to any further consolidation, merger, sale or transfer. Section 4.3. Reports to Governmental Agencies. The Borrower will furnish to agencies of the State of Minnesota, such periodic reports or statements as are required under the Act, or as they may otherwise reasonably require of the City or the Borrower throughout the term of this Agreement in connection with the transaction contemplated herein. Copies of such reports will be provided to the City • and the Lender. 11 • Section 4.4. Security for the Loan. As additional security for the Lender, and to induce the City to issue and deliver the Note, the Borrower agrees to execute and deliver the Mortgage and the Security Agreement, and agrees to meet all its obligations under the Mortgage and the Security Agreement, which documents shall remain in effect until all payments required hereunder have been made; and the Borrower will cause to be recorded and filed the Mortgage, the Security Agreement, the Pledge Agreement, financing statements and such other documents requested by the Lender or Bond Counsel, in such places and in such manner as the Lender or Bond Counsel deems necessary or desirable to perfect or protect the security interest of the Lender in and to the Project and other collateral referred to in said documents. Section 4.5. Preservation of Tax Exemption. (1) The Borrower covenants and agrees that, in order to assure that the interest on the Note shall at all times be excludable from gross income for federal income tax purposes, the Borrower represents and covenants with the City and the Lender that it will comply with the applicable provisions of Section 103 and Sections 141 through 150 of the Code and the Borrower specifically represents, covenants, and agrees as follows: (a) The Project is and will continue to be owned and operated by the Borrower and no portion of the Project is managed by anyone other than the Borrower. (b) The Project will not be used by the Borrower in an unrelated trade or business, determined by the application of Section 513(a) of the Code. • (c) No more than five percent (5%) of the net proceeds of the Note are to be used for any private business use as defined in Section 141(b)(6) of the Code. (d) The payment of the principal of, or interest on, no more than five percent (5%) of the net proceeds of the Note is (under the terms of the Note or any underlying arrangement) directly or indirectly (i) secured by any interest in (A) property used or to be used for a private business use, or (B) payments in respect of such property, or (ii) to be derived from payments (whether or not to the City) in respect of property, or borrowed money, used or to be used for a private business use. (e) The weighted average maturity of the Note will not exceed the estimated economic life of the Project by more than twenty percent (20%), all within the meaning of Section 147(b) of the Code. (f) While the Note remains outstanding, no portion of the proceeds of the Note will be used to provide any airplane, skybox or other private luxury box, any facility primarily used for gambling, or a store, the principal business of which is the sale of alcoholic beverages for consumption off premises. (g) Any Issuance Expenses financed by the Note shall not exceed two percent (2%) of the aggregate amount actually advanced on the Note. (h) The Borrower agrees it will not use the proceeds of the Note in such a manner as to cause the Note to be an "arbitrage bond" within the meaning of Section 148 of the Code and applicable Treasury Regulations. Specifically, the Borrower shall: (i) maintain records identifying all "gross proceeds" and "replacement proceeds" (as defined in Section 148(f)(6)(B) of the Code attributable to the Note, the yield at which such gross proceeds are invested, any arbitrage profit derived therefrom (earnings in excess of the yield on the Note) and any earnings derived from the investment of such arbitrage profit; • (ii) make, or cause to be made as of the end of each fifth bond year, the annual determinations of the amount, if any, of excess arbitrage required to be paid to the United States (the "Rebate Amount"); 12 • (iii) pay, or cause to be paid, to the United States at least once every fifth bond year the amount, if any, which is required to be paid to the United States, including the last installment which shall be made no later than 60 days after the day on which the Note are paid in full; (iv) not invest, or permit to be invested, "gross proceeds" of the Note in any acquired nonpurpose obligations so as to deflect arbitrage otherwise payable to the United States as a "prohibited payment" to a third party; and (v) retain all records of the annual determination of the foregoing amounts until six (6) years after the Note have been fully paid. (i) The Borrower has not leased, sold, assigned, granted or conveyed and will not lease, sell, assign, grant or convey all or any portion of the Project= or any interest therein, or its leasehold interest in the Land to the United States or any agency or instrumentality thereof within the meaning of Section 149(b) of the Code. - _ - (j) In addition to the Note, no other obligations have been or will be issued by the City the interest on which is not includable in gross income pursuant to Section 103 of the Code, which are sold at substantially the same time as the Note pursuant to a common plan of marketing and at substantially the same rate of interest as the Note and which are payable in whole or part by the Borrower or otherwise have with the Note any common or pooled security for the payment of debt service thereon, or which are otherwise treated as the same "issue of obligations" as the Note, as described in Treasury Regulations Section 1.150-1(c)(1). (k) No Note proceeds shall be invested in investments which cause the Note to be federally guaranteed within the meaning of Section 149(b) of the Code. (1) The Project is suitable for use in academic instruction and educational and cultural activities, and no part of the Project is designed for use or will be used primarily for religious instruction or as a place for devotional activities or religious worship. (m) In order to qualify the Note and this Agreement under the "governmental program" provisions of Section 1.148-1(b) of the Treasury Regulations, the Borrower (and any "related person" thereto) will take no action the effect of which would be to disqualify this Loan Agreement as an "acquired program obligation" under said Section 1.148-1(b), including but not limited to entering into any arrangement, formal or informal, for the Borrower to purchase any portion of the Note. (n) The Borrower will not otherwise use the proceeds of the Note, or take or fail to take any action, the effect of which would be to cause interest on the Note to be includable in gross income for federal income tax purposes. (2) For the purpose of this Section, a "Determination of Taxability" shall mean the issuance of a statutory notice of deficiency by the Internal Revenue Service, or a ruling of the National Office or any District Office of the Internal Revenue Service, or a final decision of a court of competent jurisdiction, or a change in any applicable federal statute, which holds or provides in effect that the interest payable on the Note is includible, for federal income tax purposes under Section 103 of the Code in the gross income of the Lender or any other holder or prior holder of the Note, if the period, if any, for contest or appeal of such action, ruling or decision by the Borrower or Lender or any other interested party has expired without any such contest or appeal having been properly instituted by the Lender, the Borrower, or any other interested party. The expenses of any such contest shall be paid by the party initiating the contest, and neither the Lender nor the Borrower shall be required to contest or appeal any Determination of Taxability. The "Date of Taxability" shall mean that point in time, as specified in the determination, ruling, order, or decision, that the interest payable on the Note becomes includable in the gross income of the Lender or any other holder or prior holder of the Note, as the case maybe, for federal income tax purposes. 13 • (3) If the Borrower receives a Determination of Taxability it shall promptly give notice of such Determination of Taxability to the City and the Lender. Upon receipt of a Determination of Taxability, the interest rate on the Note shall be increased in accordance with the terms of the Note from and after the Date of Taxability. Section 4.6. Lease or Sale of Project. The Borrower shall not lease, sell, convey or otherwise transfer the Project, in whole or part, nor sell the Project in whole or part, nor convey its leasehold interest in the Land without first securing the written consent of the Lender; provided that in no event shall such lease, transfer, assignment-e~= sale or conveyence be permitted if the effect thereof would otherwise be to impair the validity or the tax-exempt status of the Note, nor shall any such-transaction release the Borrower of any of its obligations under this Agreement, unless the assignee-transferee is a surviving, resulting or transferee entity as permitted under Section 4.2 hereof. The Borrower shall promptly notify the City of any such sale, transfer, assignment or lease. Section 4.7. Project Operation and Maintenance E~enses. The Borrower shall pay all expenses of the operation and maintenance of the Project including, but without limitation, fire and other risk insurance, public liability insurance, and such other insurance as Lender may require with respect to Borrower's properties and operations, in form, amounts, coverages and with insurance companies reasonably acceptable to the Lender, and all taxes and special assessments levied upon or with respect to the Project and payable during the term of this Agreement, all in conformance with the provisions of the Mortgage and the Security Agreement. Upon request of the Lender from time to time, the Borrower will deliver policies or certificates of insurance in form satisfactory to the Lender, evidencing compliance with the foregoing requirement. The Borrower shall, to the extent practicable, exercise its best efforts to target • any employment opportunities created by the Project to qualified individuals who are unemployed or economically disadvantaged as contemplated in Section 469.152, subdivision 11, of the Act. The Borrower will not use any proceeds of the Note to pay any costs of, or attributable to, the construction or equipping of any facilities used primarily for religious instruction or worship; all such costs will be paid with the Borrower's funds. The Borrower agrees that it will not use the Project or any part thereof (a) for sectarian instruction or study or primarily as a place for devotional activities or religious worship or as a facility used primarily in connection with any part of a program of a school or deparhnent of divinity for any religious denomination or the training of ministers, priests, rabbis or other similar persons in the field of religion or (b) in a manner which would violate the First Amendment to the Constitution of the United States of America, including the decisions of the United States Supreme Court interpreting the same, or any comparable provisions of the Constitution of the State, including the decisions of the Supreme Court of the State interpreting the same. Section 4.8. Notification of Changes. The Borrower covenants and agrees that it will promptly notify the Lender of: (1) any litigation which might materially and adversely affect the Borrower and any of its properties; (2) the occurrence of any Event of Default under this Agreement or under any other loan agreement, debenture, note, purchase agreement or any other agreement providing for the borrowing of money by the Borrower or any event of which the Borrower has knowledge and which, with the passage of time or giving of notice, or both, would constitute an Event of Default under this Agreement or under such other agreements; • 14 . (3) any future event that would cause the representations and warranties contained in this Agreement to be untrue when applied to the Borrower's circumstances as of the date of such event; and (4) any material adverse change in the operations, business, properties, assets or conditions, financial or otherwise, of the Borrower. Section 4.9. Additional Covenants. In addition to the covenants and agreements of the Borrower set forth herein and contained in the Mortgage and the documents related hereto, the Borrower hereby covenants and agrees, so long as the Note remains unpaid, as follows: (1) ~lAll advances-under the Note shall be used solely to pay Project Costs,_ (2) The Project shall comply with all applicable restrictions, conditions, ordinances, regulations and laws of governmental departments and agencies having jurisdiction over the Project, and shall not violate any private restrictions or covenants or encroach upon or interfere with easements affecting the Land;, (3) '''"The Borrower will carry on continuously, diligently and with reasonable dispatch, the construction of the Improvements in conformance to the Plans and Specifications, free from all mechanics', laborers', and materialmen's liens and in a good and workmanlike manner, and complete the same on or before the Completion Date;_ (4) ~eThe Borrower will keep, perform, enforce and maintain in full force and effect all of the terms, covenants, conditions and requirements of this Loan Agreement, the Note, the Mortgage and • the Security Agreement; and, not to amend, modify, supplement, terminate, cancel or waive any of the terms, covenants, conditions or requirements of any of said documents without the prior written consent of the Lender;, (5) Upon the demand of the Lender, from time to time, tethe Borrower will deliver to the Lender an updated survey showing the Improvements to be located within applicable lot lines of the Land and the setback lines and not encroaching upon any easements, streets or adjoining properly;, (6) eThe Borrower will not create, permit to be created or mallow to exist, liens, charges or encumbrances on the Land (other than "Permitted Encumbrances" as defined in the Mortgage) and the lien of general real estate taxes and the installments of special assessments payable therewith, except for such liens, charges and encumbrances which are being diligently contested in good faith by appropriate proceedings and provided that, if requested by the Lender, the Borrower shall have provided to the Lender security satisfactory to the Lender as set forth in Section 1.03 of the Mortgage;_ (7) ~eThe Borrower will require each contractor to comply with all rules, regulations, ordinances and laws bearing upon its conduct of work on the Improvements;-, (8) So long as Wells Fargo Bank Minnesota, National Association is the Lender, tethe Borrower will maintain substantially all of the Borrower's bank accounts with the Lender and/or an affiliate of the Lender; provided, however, that deposits with the Archdiocese of Saint Paul and Minneapolis and the Catholic Community Foundation shall not be considered bank accounts and are hereby expressly permitted and provided, further, however deposits in such bank accounts with the Lender and/or affiliates of the Lender shall not be required in excess of amounts subject to FDIC insurance unless the Lender fully collateralizes such deposits with direct obligations of the United States of America in the possession of a third party with a perfected security interest in favor of the Borrower free and clear from all claims. If the Borrower fails to maintain all such accounts with the Lender and/or 15 • an affiliate of the Lender, then the Lender shall have the option, upon prior written notice to the Borrower, of increasing the rate of interest due on the Note in accordance with the terms of the Note for the balance of the term of the Loan (which increase shall be in addition to any other increase which the Borrower may be subject to as specified herein) and/or declaring the same to be an Event of Default hereunder;_ (9) ~eThe Borrower will obtain and maintain, or cause to be obtained and maintained, at all times during the process of constructing and installing the Improvements and at all times thereafter during the term of the Loan, if applicable (and, from time to time at the request of the Lender, furnish the Lender with proof of payment of premiums on): (a) Comprehensive General Public Liability Insurance, providing for limits of coverage of not less than $2,000,000.00/$2,000,000.00 and naming the Lender and the City as additional named insureds, as their interests may appear. (b) Builder's Risk Insurance, for the Land and the Project in an amount equal to the total Project costs and naming the Lender as mortgagee and loss payee. (c) Hazard Insurance, with respect to the Land, insuring against loss by fire, lightning, theft, vandalism, malicious mischief and other risks customarily covered by a standard extended coverage endorsement, in an amount not less than the full insurable value thereof and naming the Lender as mortgagee and loss payee. (d) Workers' Compensation Insurance, with statutory coverage covering all persons engaged • in the construction or installation of the Project. (e) Flood Insurance, if any of the Land is located in a "flood plain" as defined by the Federal Insurance Administration, in the maximum amount obtainable up to the amount of the Note, naming the Lender as loss payee. All such insurance shall be pursuant to the self-insurance program of the Archdiocese of Saint Paul and Minneapolis or shall be insurance policies written by a company or companies acceptable to the Lender licensed to do business in the State of Minnesota. Such policies of insurance shall be subject to the approval of the Lender as to form, substance and (except as expressly designated above) amount, and, without limiting the generality of the foregoing, each such policy shall provide that the insurer shall give the Lender at least thirty (30) days prior written notice of cancellation, termination, amendment or non- renewal thereof. All such policies shall be in an amount sufficient to prevent the insured from becoming a co-insurer thereunder. (10) TeThe Borrower will permit the Lender, acting by and through the Lender's officers, employees and agents, to examine all books, records, contracts, plans, drawings, permits, bills and statements of account pertaining to the Project and to make extracts therefrom and copies thereof;, (11) q=eThe Borrower will furnish to the Lender as soon as possible and in any event within seven (7) days after the Borrower has obtained knowledge of the occurrence of an Event of Default, or an event which with the giving of notice or lapse of time or both would constitute an Event of Default, a statement signed by the Borrower setting forth details of such Event of Default or event and the action which the Borrower has taken, is taking or proposes to take to correct the same;, • (12) TeThe Borrower will hold the Lender harmless, and the Lender shall have no liability or obligation of any kind to the Borrower, creditors of the Borrower or any third party, in connection with 16 • any defective, improper or inadequate workmanship performed in or about, or materials supplied to, the Land and the Improvements, or any mechanics', suppliers' or materialmen's liens arising as a result of such defective, improper or inadequate workmanship or materials, and upon the Lender's reasonable request, to replace or cause to be replaced, any such defective, improper or inadequate workmanship or materials;, (13) ~eThe Borrower will pay and discharge all real estate taxes prior to the attachment of penalties with respect thereto and installments of special assessments payable therewith, and insurance premiums with respect to the insurance required to be maintained by the Borrower under the terms of any of the Borrower Documents, and utility charges incurred by the Borrower prior to or during the term of this Agreement, except if such taxes, assessments -and premiums are being contested in good faith by appropriate proceedings and provided that, if requested by the Lender, the Borrower shall have deposited into escrow with the Lender an amount equal to such taxes, assessments or premiums plus penalties accrued thereon;- (14) TeThe Borrower will cause to be prepared as soon as practicable as requested by the Lender, the required financial statements/documentation of the Borrower and operating statements for the Project and to furnish copies thereof to the Lender;, (15) TeThe Borrower will promptly give notice in writing to the Lender of any and all litigation involving the Borrower where the amount in dispute exceeds $25,000.00 and is not covered by insurance, and of any and all litigation if the aggregate amount in dispute in connection with such litigation exceeds $25,000.00 and is not covered by insurance, and of any and all material proceedings commenced against the Borrower by or before any court or governmental or regulatory agency;- • (16) TeThe Borrower will comply with the requirements of all applicable laws, rules, regulations and orders of any governmental authority, a breach of which would materially and adversely affect the business or credit of the Borrower, except where diligently contested in good faith and by proper proceedings,- (17) TeThe Borrower will comply with all existing and future registration, notification and other requirements of the Minnesota Petroleum Tank Cleanup Act, including, but not limited to, the notification of the Minnesota Pollution Control Agency of the existence of any underground and above- ground storage tanks and the age, size, type, location, use and content and of any future removal or conveyance of such tanks;, (18) q=eThe Borrower will preserve and maintain all of the Borrower's rights, privileges and franchises necessary or desirable in the normal conduct of the Borrower's business, and not to suspend business operations or convey, transfer, encumber or pledge any of the Borrower's properties or assets;- (19) ~eThe Borrower will keep all of the assets and properties necessary in the Borrower's businesses in good working order and condition, ordinary wear, tear and casualty excepted;, (20) ~eThe Borrower will obtain all necessary state, federal, local and private clearances, authorizations, permits and licenses with respect to the business operations of the Borrower, including, without limitation, any export and other trade licenses or permits required by law for the present or future business operations of the Borrower;-ate, • (21) IeThe Borrower will not undertake or permit without prior written approval of the Lender any other or additional construction on the Land or on any site or sites adjacent thereto owned by the Borrower, or any parties related to the Borrower. 17 • (22) ~eThe Borrower will deliver to the Lender such financial statements and other financial information/documentation normally prepared by the Borrower in the ordinary course of business as the Lender may require before and during the term of the Loan, including Annual Parish Financial Reports. The foregoing financial information documentation shall be provided to the Lender in a timely manner as reasonably required by the Lender. It is understood that the Lender may require the Borrower to sign any financial statements and financial information/documentation provided. If the Borrower fails to provide financial statements or other financial information/documentation to the Lender as required hereunder and such failure continues after ten (10) days' written notice thereof from the Lender to the Borrower, then the Lender shall have the option, upon prior written notice to the Borrower of increasing the rate of interest due on the Note in accordance with the terms of the Note for the balance of the term (which increase shall be in addition to any other increase which the Borrower may be subject to as specified herein) and/or declaring such failure to constitute an Event of Default hereunder. • (The remainder of this page is intentionally left blank.) • 18 . ARTICLE 5 PREPAYMENT OF LOAN Section 5.1. Prepayment at Option of Borrower. The Borrower may at its option prepay the Loan, in whole or in part, at par plus accrued interest, and without penalty. Any partial prepayment shall be applied first against the interest accrued on the Note and shall be applied against the principal portion of the installments due under this Agreement. Upon any such partial prepayment, the Note shall be re-amortized or at the written election of the Borrower accompanied b~pinion of Bond Counsel that such election will not-cause interest on the Note to become includable in gross income for federal income tax purposes, such ~repayments may be applied to the principal of the Note in inverse order of maturity. In the event the Borrower elects to prepay the Loan, the Borrower shall cause to be given in the name of the City due notice of redemption or prepayment of the Note as required by the Note, and shall pay the prepayment price when due to the Lender. The City hereby authorizes the Borrower to give mailed notice of prepayment and, if required by law, published notice of prepayment of the Note in the name of the City, from time to time. (The remainder of this page is intentionally left blank.) • n U 19 • ARTICLE 6 EVENTS OF DEFAULT AND REMEDIES Section 6.1. Events of Default. Any one or more of the following events is an Event of Default under this Agreement: (1) If the Borrower shall fail to make (a) any payments required under Section 3.4 of this Agreement on the date due, or (b) any other payment due under this Agreement on or before the date that the payment is due and such default continues for ten (10) days after written notice-given to the Borrower by the City or the Lender as provided in the Note. (2) If the Borrower shall fail to observe and perform any other covenant, condition or agreement on its part under this Agreement for a period of thirty (30) days after written notice, specifying such .default and requesting that it be remedied, given to the Borrower by the City or the Lender, unless the Lender shall agree in writing to an extension of such time prior to its expiration, or for such longer period as may be reasonably necessary to remedy such default provided that the Borrower is proceeding with reasonable diligence to remedy the same. (3) The occurrence of a Determination of Taxability. (4) If the Borrower shall file a petition in bankruptcy or for reorganization or for an arrangement pursuant to any present or future federal bankruptcy act or under any similar federal or state • law, shall consent to the entry of an order for relief pursuant to any present or future federal bankruptcy act or under any similar federal or state law, or shall make an assignment for the benefit of its creditors or shall admit in writing its inability to pay its debts generally as they become due, or if a petition or answer proposing the entry of an order for relief of the Borrower under any present or future federal bankruptcy act or any similar federal or state law shall be filed in any court and such petition or answer shall not be discharged or denied within 90 days after the filing thereof, or a receiver, trustee or liquidator of the Borrower of all or substantially all of the assets of the Borrower, or of the Project shall be appointed in any proceeding brought against the Borrower and shall not be discharged within 90 days after such appointment or if the Borrower- shall consent to or acquiesce in such appointment, or if the estate or interest of the Borrower in the Project or a part thereof shall be levied upon or attached in any proceeding and such process shall not be vacated or discharged within 90 days after such levy or attachment; if the Borrower shall be dissolved or liquidated or shall be merged with or is acquired by another business entity in violation of Section 4.2. (5) If the articles of incorporation of the Borrower shall expire or be annulled; or if the Borrower shall be dissolved or liquidated (other than when a new entity assumes the obligations of the Borrower under the conditions permitting such action contained in Section 4.2). (6) If any representation or warranty made by the Borrower herein, or by an officer or representative of the Borrower in any document or certificate furnished the Lender or the City in connection herewith or therewith or pursuant hereto or thereto, shall prove at any time to be, in any material respect, incorrect or misleading as of the date made. (7) If the Borrower shall default or fail to perform any covenant, condition or agreement on • its part under the Mortgage or any other security document securing the Note, and such failure continues beyond the period set forth in such documents during which the Borrower may cure the default. 20 . (8) Failure of the Borrower to comply with or to perform any term, obligation, covenant or condition contained in any other agreement between the Lender and the Borrower. Section 6.2. Remedies. Whenever any Event of Default referred to in Section 6.1 hereof shall have happened and be subsisting, any one or more of the following remedial steps to the extent permitted by law may be taken by the City with the prior written consent of the Lender or by the Lender itself: (1) The City, upon written direction of the Lender, or the Lender may declare all installments of the Loan (being an amount equal to that necessary to pay in full the Principal Balance plus accrued interest thereon of the Note assuming acceleration of the Note under the terms thereof and to pay all other indebtedness thereunder) to be immediately due and payable, whereupon the- same shall become immediately due and payable by the Borrower. (2) The City, upon written direction of the Lender (except as otherwise provided in Section 7.9 herein), or the Lender (in either case at no expense to the City) may take whatever action at law or in equity may appear necessary or appropriate to collect the amounts then due and thereafter to become due under this Agreement, or to enforce performance and observance of any obligation, agreement or covenant of the Borrower under this Agreement. Section 6.3. Disposition of Funds. Notwithstanding anything to the contrary contained in this Agreement, any amounts collected pursuant to action taken under Section 6.2 hereof, except for any amounts collected solely for the benefit of the City under any of the provisions set forth in Section 7.9, shall, after deducting all expenses incurred in collecting the same, be applied as a prepayment of the Note in accordance with Section 5.1. • Section 6.4. Manner of Exercise. No remedy herein conferred upon or reserved to the City 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 by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the City or the Lender to exercise any remedy reserved to either of them in this Article, it shall not be necessary to give any notice, other than such notice as may be herein expressly required. Section 6.5. Attorneys' Fees and Expenses. In the event the Borrower should default under any of the provisions of this Agreement and the City or the Lender should employ attorneys or incur other expenses for the collection of amounts due hereunder or the enforcement of performance of any obligation or agreement on the part of the Borrower, the Borrower will on demand pay to the City or the Lender the reasonable fee of such attorneys and such other expenses so incurred. Section 6.6. Effect of Waiver. In the event any agreement contained in this Agreement should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach hereunder. • (The remainder of this page is intentionally left blank.) 21 • ARTICLE 7 GENERAL Section 7.1. Notices. All notices, certificates or other communications hereunder shall be sufficiently given and shall be deemed given when mailed by certified or registered mail, postage prepaid, with proper address as indicated .below. The City, the Borrower and the Lender may, by written notice given by each to the others, designate any address or addresses to which notices, certificates or other communications to them shall be sent when required as contemplated by this Agreement. Until otherwise provided by the respective parties;-all notices, certificates and communications to each of them shall be addressed as follows: To the City: City of Richfield, Minnesota 6700 Portland Avenue Richfield, Minnesota 55423 Attn: City Manager To the Borrower: Academy of Holy Angels 6600 Nicollet Avenue South Richfield, Minnesota 55423-2498 Attn: Parish Administrator With a copy to: Catholic Finance Corporation • 5826 Blackshire Path Inver Grove Heights, MN 55076 Attn: Executive Director To the Lender: Wells Fargo Bank Minnesota, National Association MAC N9117-031 430 North Wabasha Street Suite 302 Saint Paul, Minnesota 55101 Attn: Section 7.2. Binding Effect. This Agreement shall inure to the benefit of and shall be binding upon the City and the Borrower and their respective successors and assigns. Section 7.3. Severability. In the event any provision of this Agreement shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. Section 7.4. Amendments, Changes and Modifications. Except as otherwise provided in this Agreement or in the Resolution, subsequent to the initial issuance of the Note and before the Note are satisfied and discharged in accordance with their terms, this Agreement may not be effectively amended, changed, modified, altered, or terminated without the written consent of the Lender. Section 7.5. Execution Counterparts. This Agreement may be simultaneously executed in • several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. 22 Section 7.6. Limitation of City's.~.iability. It is understood and agreed by the Borrower and the Lender that no covenant of the City herein shall give rise to a pecuniary liability of the City or a charge against its general credit, or taxing powers. It is further understood and agreed by the Borrower and the Lender that the City shall incur no pecuniary liability hereunder, and shall not be liable for any expenses related hereto, including administrative expenses and fees and disbursements of the City's attorney, Bond Counsel and fiscal consultant retained in connection therewith, all of which expenses the Borrower agrees to pay. Section 7.7. City's Fees and Costs. If, notwithstanding the provisions of Section 7.6 hereof, the City incurs any expense, or suffers any losses, claims or damages, or incurs any liabilities in connection with the transaction contemplated by this Agreement, the Borrower will indemnify and hold harmless the City from the same and will reimburse the City for any reasonable legal or other expenses incurred by the City in relation thereto. The Borrower shall also reimburse the City for all other costs and expenses, including without limitation reasonable attorneys' fees, paid or incurred by the City in connection with (i) the discussion, negotiation, preparation, approval, execution and delivery of this Agreement, the Note, the Pledge Agreement and the documents and instruments related hereto or thereto; (ii) any amendments or modifications hereto or to the Note, the Pledge Agreement and any document, instrument or agreement related hereto or thereto, and the discussion, negotiation, preparation, approval, execution and delivery of any and all documents necessary or desirable to effect such amendments or modifications; and (iii) the enforcement by the City during the term hereof or thereafter of any of the rights or remedies of the City hereunder or under the Note, the Pledge Agreement or any document, instrument or agreement related hereto or thereto, including, without limitation, costs and expenses of collection in the Event of Default, whether or not suit is filed with respect thereto. • Section 7.8. Release. The Borrower hereby acknowledges and agrees that the City shall not be liable to the Borrower, and hereby releases and discharges the City from any liability, for any and all losses, costs, expenses (including attorneys' fees), damages, judgments, claims and causes of action, paid, incurred or sustained by the Borrower as a result of or relating to any action, or failure or refusal to act, on the part of the Lender with respect to this Agreement or the documents and transactions related hereto or contemplated hereby, including, without limitation, the exercise by the Lender of any of its rights or remedies pursuant to Article 6, the Note, the Pledge Agreement, the Mortgage, the Security Agreement or any collateral security documents. The Borrower's release of the City pursuant to the preceding sentence does not extend to the Lender following the assignment of the City's rights to the Lender pursuant to the Pledge Agreement. Section 7.9. Assignment by City and Survivorship of Obli atg ions. The City may assign its rights under this Agreement and any related documents to the Lender to secure payment of the principal of and interest and premium, if any, on the Note, conditioned upon the Lender's assumption of the City's and Lender's obligations to the Borrower hereunder, but any such assignment shall not operate to limit or otherwise affect the provisions of Sections 3.6, 4.1, 4.3, 6.5, 7.6, 7.7, or 7.8 hereof to the extent that they run to the City from the Borrower to which extent they shall survive any such assignment. The City shall have the right to enforce any retained rights without the approval of the Lender. The obligations of the Borrower running to the City for the purpose of preserving the tax exempt status of the Note or otherwise for the City's benefit under the foregoing Sections shall survive payment of the Note and interest thereon. Section 7.10. Required Approvals. Consents and approvals required by this Agreement to be obtained from the Borrower, the City or the Lender shall be in writing and shall not be unreasonably withheld or delayed. • Section 7.11. Termination Upon Retirement of Note. At any time when no principal balance on the Note remains outstanding, and arrangements satisfactory to the Lender and the City have been 23 • made for the discharge of all other accrued liabilities, if any, under this Agreement, this Agreement shall terminate, except as otherwise expressly provided in Section 7.9 or otherwise herein. Section 7.12. Lender's Attornevs' Fees and Costs. The Borrower agrees to pay upon demand all of the Lender's out-of-pocket expenses, including reasonable attorneys' fees, incurred in connection with this Agreement, the Loan or the Note. The Lender may pay someone else to help collect the Loan and to enforce this Agreement, and Borrower will pay that amount. This includes, subject to any limits under applicable law, Lender's attorneys' fees and legal expenses, whether or not there is a lawsuit, including attorneys' fees for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated post judgment collection services. The Borrower also will pay any court costs, in addition to all other sums provided by law. (The remainder of this page is intentionally left blank.) r~ LJ • 24 In witness whereof, the City and the Borrower have caused this Agreement to be executed in their respective names all as of the date first above written. CITY OF RICHFIELD, MINNESOTA By Its Mayor By Its City Manager • • S-1 • Execution page of the Borrower to the Loan Agreement, dated as of December 1, 2002. RC 145-502 (JU) 223772v.~3 ACADEMY OF HOLY ANGELS By Its By. Its S-2 tSecond Draft ,Tuesday, December 3, 2002 PLEDGE AGREEMENT between CITY OF RICHFIELD, MINNESOTA and bWELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION Dated as of December 1, 2002 PLEDGE AGREEMENT This Pledge Agreement, dated as of December 1, 2002, is made and entered into between the City of Richfield, Minnesota, a municipal corporation and political subdivision of the State of Minnesota (the "City") and Wells Fargo Bank Minnesota, National Association, a national banking association (the "Lender"). RECITALS WHEREAS, Academy of Holy Angels, a Minnesota nonprofit corporation (the "Borrower") and the City have entered into a Loan Agreement, dated as of December 1, 2002 (the "Loan Agreement"), pursuant to which the City will lend to the Borrower the proceeds of its Educational Facilities Revenue Note (Academy of Holy Angels Project), Series 2002 (the "Note"), issued by the City in the original aggregate principal amount of $8,540,000; and WHEREAS, the Note is payable from and secured by the loan repayments to be made by the Borrower under the Loan Agreement; and the Lender, as a condition to the purchase of the Note, has required the execution of this Pledge Agreement. Now, therefore, as an inducement to the Lender to purchase the Note, and in consideration of the promises and other good and valuable consideration, the receipt and sufficiency whereof is hereby acknowledged, the parties hereby agree as follows: 1. In order to secure the due and punctual payment of the Note and all other sums due the Lender under the Loan Agreement, the City does hereby pledge and assign to the Lender all of the City's right, title and interest in and to the Loan Agreement, subject to the City's reserved rights referred to in Section 7.9 of the Loan Agreement. 2. The City hereby represents and warrants to the Lender that the City has not assigned its right, title and interest in the Loan Agreement to any person other than the Lender pursuant to the terms of this Pledge Agreement. 3. The City hereby authorizes the Lender to exercise, whether or not a default exists under the Note or an Event of Default has occurred under the Loan Agreement, either in the City's name or the Lender's name, any and all rights or remedies available to the City under the Loan Agreement. The City agrees, on request of the Lender, to execute and deliver to the Lender such other documents or instruments as shall be deemed necessary or appropriate by the Lender at any time to confirm or perfect the security interest hereby granted. The City hereby appoints the Lender as its attorney-in-fact to execute on behalf of the City, and in its name, any and all such assignments, financing statements or other documents or instruments which the Lender may deem necessary or appropriate to perfect, protect or enforce the security interest hereby granted. 4. The City will not: (a) exercise or attempt to exercise any remedies under the Loan Agreement except as permitted by Sections 6.2 and 7.9 of the Loan Agreement, or terminate, modify or accept a surrender of the same, or by affirmative act, consent to the creation or existence of any security interest or other lien in the Loan Agreement to secure payment of any other indebtedness; or (b) receive or collect or permit the receipt or collection of any payments, receipts, rentals, profits or other moneys under the Loan Agreement (except as allowed under Section 7.9 thereof) or assign, transfer or hypothecate (other than to the Lender hereunder) any of the same then due or to accrue in the future. 5. The City expressly covenants and agrees that the Lender shall be entitled to receive all payments under the Loan Agreement (except any payments due the City under Section 7.9 thereof), and hereby authorizes and directs the Borrower to make such payments directly to the Lender. The Lender covenants and agrees that all payments received by the Lender pursuant to the Loan Agreement shall be applied to the payment of principal and interest on the Note. 6. If an Event of Default (as defined in the Loan Agreement) shall occur and be continuing, the Lender may exercise any one or more or all, and in any order, of the remedies hereinafter set forth, it being expressly understood that no remedy herein conferred is intended to be exclusive of any other remedy or remedies; but each and every remedy shall be cumulative and shall be in addition to every other remedy given herein or now or hereafter existing at law or in equity or by statute: (a) The Lender may, without prior notice of any kind,_ declare the principal of and interest accrued on the Note immediately due and payable. (b) The Lender may exercise any rights and remedies and options of a secured party under the Uniform Commercial Code as adopted in the State of Minnesota and any and all rights available to it under the Loan Agreement, the Mortgage and the Security Agreement (as defined in the Loan Agreement) securing payment of the Note. 7. Whenever any of the parties hereto is referred to, such reference shall be deemed to include the successors and assigns of such party; and all the covenants, promises and agreements in this Pledge Agreement contained by or on behalf of the City or the Lender shall bind and inure to the benefit of the respective successors and assigns of such parties whether so expressed or not. 8. The unenforceability or invalidity of any provision or provisions of this Pledge Agreement shall not render any other provision or provisions herein contained unenforceable or invalid. 9. This Pledge Agreement shall in all respects be construed in accordance with and governed by the laws of the State of Minnesota. This Pledge Agreement may not be amended or modified except in writing signed by the City and the Lender. 10. This Pledge Agreement may be executed, acknowledged and delivered in any number of counterparts and each of such counterparts shall constitute an original but all of which together shall constitute one agreement. 11. The terms used in this Pledge Agreement which are defined in the Loan Agreement shall have the meanings specified therein, unless the context of this Pledge Agreement otherwise requires, or unless such terms are otherwise defined herein. 12. No obligation of the City hereunder shall constitute or give rise to a pecuniary liability of the City or a charge against its general credit or taxing powers, but shall be payable solely out of the proceeds and the revenues derived under the Loan Agreement. In witness whereof, the City and the Lender have caused this Pledge Agreement to be duly executed as of the day and year first above written. • CITY OF RICHFIELD, MINNESOTA By Its Mayor By Its City Manager S-1 Execution page of the Lender to the Pledge Agreement, dated as of December 1, 2002. SWELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION By Its • RC145-502 (JU) 223777v.~3 S-2 • AGENDA SECTION: AGENDA ITEM # REPORT # ~~ STAFF REPORT CONSENT 4F c~c c~g CITY COUNCIL MEETING DECEMBER 10, 2002 • • BRUCE SYLVESTER, REPORT PREPARED BY: PLANNING & ZONING ADMINISTRATOR NAME, TITLE BRUCE PALMBORG, REPORT PRESENTER: COMMUNITY DEVELOPMENT DIRECTOR NAME, TITLE DEPARTMENT DIRECTOR REVIEW: ~ ~~~ REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Consideration of a subdivision waiver for 6944 13th Avenue South. I. RECOMMENDED ACTION: By motion: Adopt the attached resolution approving the subdivision waiver for 694413th Avenue South. III. BACKGROUND The applicants, Mr. Richard Ratcliff and Ms. Judy Holmes, are seeking to split the 112 foot wide corner lot at 6944 13th Avenue South into two separate lots. The current single parcel consists of the combination of two platted parcels. The originally platted corner parcel (Lot 5) is 52 feet wide while the originally platted interior parcel (Lot 4) is 60 feet wide. The proposed lot split will create a 57-foot wide corner lot and a 55-foot wide interior lot. An existing house sits on Lot 5 at the south end of the parcel, closest to the corner of 13th Avenue and 70th Street. Mr. Ratcliff and Ms. Holmes plan to sell the interior lot for the construction of a new single-family detached house. 1210-SubWaiver-13thAve.doc III. BASIS OF RECOMMENDATION A. POLICY • Approval of the subdivision waiver would not interfere with the purposes of platting regulations, Section 500.05. • Compliance with the regular platting requirements of Section 500.05, Subdivision 1 of the City Code would result in an unnecessary hardship. B. CRITICAL ISSUES • Both resulting lots will meet minimum lot width and depth requirements. • Approval of the subdivision waiver will result in a buildable 55-foot wide lot and a 57-foot wide lot with an existing house. • 6944 13th Avenue is in the R (Single Family Residential) zoning district. The area of the proposed parcels will be 7,020 (Lot 4) and 7,304 square feet (Lot 5) after the lot split. The minimum lot size requirement in the R District is 6,700 square feet. Both lots after the split therefore will meet the minimum lot size requirements. • Of the three abutting parcels, one is 50 feet wide and two are 60 feet wide. Most parcels in the immediate vicinity are either 50 feet or 60 feet wide. The proposed lot split will not affect the setbacks for the existing house on the parcel. The existing house meets and will continue to meet setback requirements for the front yard and the interior-side side yard. i The house currently does not meet rear year or street-side side yard setback requirements, but these setbacks are not affected by the proposed lot split. • The applicant has been informed that water and sanitary sewer services may be necessary to the new parcel. C. FINANCIAL • N/A D. LEGAL • No legal or mailed notice is required; however, Community Development staff did send a mailed notice to neighbors within 100 feet to inform them of this requested subdivision waiver. Neighbors may want to comment on this request before the Council takes action. • 60 DAY RULE: The 60 day `clock' started when a complete application was received on November 13, 2002. A decision must be given to the applicant by January 12, 2002 OR the Council must notify the applicant that it is extending the deadline (up to a maximum of 60 additional days or 120 days total) for issuing a decision. IV. ALTERNATIVE RECOMMENDATION(S) • Deny this subdivision waiver if a finding of fact determines that the proposal would have an adverse impact on the public health, safety, or welfare. V. ATTACHMENTS • City Council Resolution • Certificate of Survey • November 12, 2002 letter from Mr. Ratliff and Ms. Holmes • Land-use and zoning maps for properties within 350 feet of the subject parcel VI. PRINCIPAL PARTIES EXPECTED AT MEETING • Mr. Richard Ratcliff, applicant and owner of 6944 13th Avenue South. • C RESOLUTION NO. • RESOLUTION AUTHORIZING A SUBDIVISION WAIVER 694413th AVENUE SOUTH WHEREAS., an application has been filed with the City of Richfield which requests approval of a subdivision waiver for the division of certain parcels of land located at 6944 13th Avenue South, legally described as: Parcel A: Lots 4 and 5, Block 2, RICHLANDS 2ND ADDITION WHEREAS, the applicant proposes to divide the above-described Parcel A into two parcels, legally described as: Parcel B: The north 55 feet of lot 4, Block 2, RICHLANDS 2ND ADDITION Parcel C: Lot 5 and that part of Lot 4 lying south of the north 55 feet thereof, Block 2, RICHLANDS 2ND ADDITION WHEREAS, the .proposed lots B and C meet city requirements for minimum lot area, width, and depth; and WHEREAS, the City has fully considered the request for approval for the • subdivision waiver; and WHEREAS, the City Council finds that compliance with the City Code Section 500.05, Subdivision 1 would result in unnecessary hardship and that failure to comply therewith will not interfere with the purposes of the platting regulations of Section 500.01. NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Richfield, Minnesota, as follows: 1. A waiver for the subdivision of the Subject Property legally described above is hereby granted; and 2. City staff is authorized and directed to take any action necessary to effectuate this resolution and to authorize the recording of conveyances complying with the terms of this resolution. Adopted by the City Council of the City of Richfield, Minnesota this 10h day of December, 2002. Martin J. Kirsch, Mayor ATTEST: Nancy Gibbs, City Clerk ~ t S rR 2 < N O Z ~ ~~ N • y O ~ O ~ }. po ~ J N w > ~ s og ~ o N LL ~ N ~ ~_ Uh N ~ ~C ,,^^ V/ Or ~ t C^ g h 4 ~' V ~ I N m Y N ~ ~ F .. ^ ' s Y `F a I ~ ~ ~ 1! o ~e~0(Aa~i ~ ~ S w _ LL ~ ~ ~ L $~ a $~ ~ ~ ~ N e ~ ~oS ~Op~$ N ~M 2NC y~~ j'~ ~/ O~ pP p=h ~ c~ ~~ •cor gg y~~ 33~ 0~ w 'S $ 01 '3AV ~ 43£ l ~_ ~z x U .~m e U ~ r M ,OO,OOAO N ~ ' 3 •00.00.00 5 I ----- - --00'SS-- ,r- --ZZ'LS-- - -~ j ~ i~ ° ~. ~ I~ I a i +sb ~ p. r; Y I I SI ~~ I C U U4 I ~ C U U4 I I • 1 / / ~ ~ Iu ~~ / II ~~ x~~° 3 H ° C7 - _- w W I tY W I 6. 656. I W ~ b h '~• N n A h ° ~~j~p ' ' 'v ,O i ^ ~ I ~ Y +~ ^ vI M N I ~ ' ~ I ~ ~~ ' ~ 61 ~ f/1 I o ~ ~ ~ . ::.. + l7 N I .Z. f ~ waSS.b ~ i y + + In • ~ N .'~ 656.7 ? ^ ~ . ~.7 ~ X 0 6664 ,S ~ $ w W2 ~ 8~ p ~ /~ , ye O ~ ` ~ ~' } O 1~ d ~ \ ~ i . \ wu ~ R ~ f'~ oI ~ : .r: ~ ~ •tt- I ~„~`i;- I x ¢ I « 1 ~ SI j J ` ~ I ~ J / ~ Y ~ ° _ ~ M , ~ 0.00 N u I` ~_• beta ° \ --9Z'LS-- n -_ I ~ ~ M ,it,t0A0 N ^ a y:~ V ~ ~ 8 D4~ 4 pN O8 4 1 , C ~' v ~ o 4 .w .~ s Z g $ ~ xx$ ~ o '3 d 0 6: g _ C ~~ ~~ ~ ~ p TT m ~y $~ ~; ~ w s -~ N (Q ~~ < O ~ N "g a ~ 8 ~~ ~~ ~~~~ n R ~ ^ ~ ~ aom~ ° c s O~ O r C _ ~. h,. n • Proposal by Richard R. Ratcliff and Judith A. Holmes November 12, 2002 My Mother (Clara Ratcliff) passed away January 3, 2002. She willed her home at 6944 13`h Ave. South, Richfield, MN. To my sister Judy and myself. Judy and I grew up in this house. The house has been vacant since January of this year.. The house is located on lot 5, Block 2, Richlands 2nd Addition. It was built in 1928. The house is within 6 inches of lot 4, Block 2, Richlands 2nd Addition. Please look at the recent survey. We own both parcels. There are no liens on this property and taxes have been paid for the 2nd half (see canceled check). We have been paying the utilities every month and are current. I have contacted Hennepin County and asked permission to subdivide 5 feet (in a straight line) of lot 5 and add it to lot 4. I was told that as long as the division is in a straight line, the county has absolutely no objection to this. I was told that I do not need it in writing. My request to the Richfield City Council is for approval for subdivision. The current situation on the property is this. The added value of lot 5 makes this 1928 house difficult for us to sell. By subdividing the parcels, the home would be more affordable ($180- 185,000.00) and a brand new home could be built on Lot 5. As proposed, Lot 5 meets all City requirements for new construction. A new home in Richfield would add considerably more tax base than the current vacant lot. • I have talked to adjacent neighbors about our proposed subdivision and let them know that when a new home is built, there will be construction noise and additional traffic. l.By subdividing the parcels, we will be able to sell the house and move forward with our lives. 2. By subdividing the parcels another family can move into a brand new home in East Richfield and ad to the tax base. My sister and I hereby request that the Richfield City Council approve subdivision of the two lots. Thank You ~Grr~rce Tile Richard Ratcliff and Judith Holmes n REQUESTED SUBDMSION WAIVER FOR 6944 13TH AVENUE DECEMBER 2002 ZONING OF PROPERTIES VIATHIN 350 FEET ~~m~~~~~ Q O W 0 R R R R R R R u,j R R a9Q R R R r. R R R R R o RICHFIELD INTERIVEDIATE SCHOOL R R R ==Q R M R ~ R R 6944 R R R R R R R R R R R R R 5~ ~~ 7oTH sT. 3 R R R R R R R R R R R F R R R ~L 1 ~ ~ ~ 71ST ST. R = SINGLE FAMILY RESIDENTIAL . N 100 0 .100 200 300 400 500 600 700 800 Feet 11-18-02 REQUESTED SUBDMSION WAIVER FOR 6944 13TH AVENUE DECEMBER 2002 LAND USES OF PROPERTIES WITHIN 350 FEET ~~~~~~~~ a O W Q r SCH SCH ~ s REs u 5 ~ RES RES a ~ Q RES RES ~ r. RES ~ RES RES = M r RES RES r RES RES ~ RES RES RES RES RES RES ~S RES RES RES s~~ ,. ~• RICHFIELD INTERMEDIATE SCFI001_ RES REs RES RES RES RES RES REs ~~ ~mmm~ LAND USE SYNEOLS RES = SINGLE FAMILY RESIDENTIAL SCH =SCHOOL 100 0 100 200 300 400 500 600 700 Feet N 11-18-02 RES s REs RES REs RES RES RES RES RES RES RES RES -oTH sT. RES REs RES RE - RES FS REs a r 71ST S7: AGENDA SECTION: ~ n c~~"'~' AGENDA ITEM # ~} ~ REPORT # a ~'~ • J STAFF REPORT CITY COUNCIL MEETING • DECEMBER 10, 2002 JULIE URBAN, REPORT PREPARED BY: COMMUNITY DEVELOPMENT SPECIALIST BRUCE PALMBORG, REPORT PRESENTER: COMMUNITY DEVELOPMENT DIRECTOR NAME, TITLE DEPARTMENT DIRECTOR REVIEW: ~ ~/~~~ REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Consideration of a resolution establishing revised just compensation and authorizing the purchase of the apartment building located at 6344 Cedar Avenue (Airport Noise Acquisition Program). I. RECOMMENDED ACTION: By Motion: Approve the attached resolution establishing revised just compensation and authorizing the purchase of 6344 Cedar Avenue Airaort Noise Acauisition Proaram III. BACKGROUND ~ On March 26, 2002, the City Council approved an agreement (Agreement) with the Metropolitan Airports Commission (MAC) to provide $10 million of Federal Aviation Administration (FAA) airport improvement program funds to the City of Richfield to purchase properties that are, or will be, negatively impacted by airport operations. The City has identified 20 single family homes and two duplexes in the 6600 and 6700 blocks of 18th Avenue and seven apartment buildings on Cedar Avenue, north of 66th Street, for purchase. • On October 8, 2002, the City Council approved just compensation of $605,000 for the. apartment building at 6344 Cedar Avenue and authorized staff to begin negotiations to purchase the property. The property owners have made a counter offer of $625,000 with the provision that they will continue to manage the property 1210-6344cedar.doc and receive rental income until such time as they provide the City with 90 days notice to terminate management services or August 15, at the latest. • The apartment tenants may also be eligible for relocation benefits. The relocation benefits will be calculated separately once an offer is made to the property owner in accordance with the Uniform Relocation Act. Attached is the resolution for City Council consideration. III. BASIS OF RECOMMENDATION A. POLICY • The City and MAC have identified this property for purchase for the Airport Noise Acquisition Program in accordance with the Agreement. The property is within the 87dB contour. B. CRITICAL ISSUES Approval of revised just compensation would relieve the City of managing the property while tenants are still living in the building. C. FINANCIAL • MAC staff concurs with the revised just compensation amount. • The counter offer is $20,000, or 3.3 percent, higher than the appraised value. • The current property owners will continue to manage the property and collect the rental payments. • D. LEGAL • Approval of revised just compensation would authorize the City's legal counsel to present a purchase agreement to the seller. E. TIMING • The current property owners will continue to manage the property until such time as the owners provide the City with 90 days notice to terminate management services or August 15, at the latest. • Tenants will be provided with a 90-day notice to vacate and a determination of relocation benefits no later than May 15. ALTERNATIVE KECOMMENDATION(S) ~ • Delay approval of revised just compensation. • Do not approve revised just compensation. ATTACI-EVIENTS • Resolution establishing revised dust compensation and authorizing the purchase of property. VI. PRINCIPAL PARTIES EXPECTED AT MEETING ~ • RESOLUTION NO. RESOLUTION ESTABLISHING REVISED JUST COMPENSATION AND AUTHORIZING PURCHASE OF REAL PROPERTY LOCATED AT 6344 CEDAR AVENUE AIRPORT NOISE ACQUISITION PROGRAM WHEREAS, on September 10, 2001, the City Council approved the acquisition strategy for residential property in the airport mitigative area, using $10 million in federal funds secured by Congressman Sabo; and WHEREAS, on March 26, 2002, the City Council approved an agreement (Agreement) with the Metropolitan Airports Commission (MAC) to provide $10 million of Federal Aviation Administration (FAA) airport improvement program funds to the City of Richfield to purchase properties (including all related costs) that are, or will be, negatively impacted by airport operations; and WHEREAS, within the aforementioned airport mitigative area the real property listed within Exhibit A is identified for purchase; and WHEREAS, the City is authorized by Minnesota Statutes to acquire real property within its corporate boundaries; and WHEREAS, the City has extended an offer of fair market value, as determined by qualified independent professional appraisers, to the owners of real property listed in Exhibit A; and WHEREAS, the owners of real property at 6344 Cedar Avenue have presented a counter offer to the City for the purchase of the property in the amount listed in Exhibit B; and WHEREAS, the City is authorized to negotiate for the purchase of property and to extend purchase offers to owners within 110 percent of the appraised value, up to $25,000. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield, Minnesota as follows: 1. That the revised just compensation in Exhibit B is hereby approved. 2. That the City's acquisition/negotiation/relocation consultant, Conworth, Inc., is authorized to present a purchase offer of said amount listed in Exhibit B to the owners of real property listed in Exhibit A. Adopted by the City Council of the City of Richfield, Minnesota this 10th day of December, 2002. Martin J. Kirsch, Mayor ATTEST: • Nancy Gibbs, City Clerk EXHIBIT A • Pro a Address Le al Descri tion 6344 Cedar Ave S Lot 1 and the South 60 Feet of Lot 2, Block 3, Iversons 3rd Addition Together with all abutting streets and alleys, vacated or to be vacated, and all easements, gaps, overlaps and gores, a urtenant thereto EXHIBIT B Pro a Address Settlement Offer 6344 Cedar Ave S $625,000 1"'1 U • C7 AGENDA SECTION: ~ 5f~'f AGENDA ITEM # D REPORT # cZ 8 `7 STAFF REPORT CITY COUNCIL MEETING • "''' '"' DECEMBER 10, 2002 BRUCE SYLVESTER, REPORT PREPARED BY: PLANNING & ZONING ADMINISTRATOR NAME, TIT/.L•' BRUCE PALMBORG, REPORT PRESENTER: COMMUNITY DEVELOPMENT DIRECTOR DEPARTMENT DIRECTOR REVIEW: REVIEWED BY CITY MANAGER: ITEM FOR COUNCIL CONSIDERATION: Continuation of the public hearing for the preliminary plat for the City Bella redevelopment project. I. RECOMMENDED ACTION: By Motion: Continue the public hearing for the preliminary plat for the City Bella redevelopment project until January 14, 2003. II. BACKGROUND Community Development staff and the City Attorney are working with the Gramercy Corporation to finalize the preliminary plat for the City Bella redevelopment project at 66th Street and Lyndale Avenue. Several items have yet to be finalized before this item will be ready for Council review; therefore, staff is requesting that the public hearing for the preliminary plat be continued until the January 14, 2003 meeting. III. BASIS OF RECOMMENDATION A. POLICY • N/A 1210-ContinueCityBellaPlat.doc B. CRITICAL ISSUES • 60 DAY RULE: The 60 day clock `started' when a complete application was received on October 31, 2002. The City informed the applicant that it extended the deadline to issue a decision by an additional 60 days, and so a decision must be given to the applicant by February 28, 2003. C. FINANCIAL • N/A D. LEGAL • Notice of the public hearing for this item was published in the Sun Current on November 28, 2002. Anew legal notice will be published in the Sun Current for the January 14, 2003 public hearing. IV. ALTERNATIVE RECOMMENDATION(S~ • Continue the public hearing and second reading to a different date. ~ V. ATTACHMENTS ~ VI. PRINCIPAL PARTIES EXPECTED AT MEETING • • r L J AGENDA SECTION: l_ CI'1 rj~"t" AGENDA ITEM # ~..{ (~ REPORT # ~ ~ j STAFF REPORT CITY COUNCIL MEETING • • DECEMBER 10, 2002 REPORT PREPARED BY: REPORT PRESENTER: DEPARTMENT DIRECTOR REVIEW: REVIEWED BY CITY MANAGER: JIM OLSON, PROJECT ENGINEER NAME, TITLE MIKE EASTLING, PUBLIC WORKS DIRECTOR NAME, TITLE ITEM FOR COUNCIL CONSIDERATION: Consideration of acceptance of Commissioners' Award on Parcel 5, Fountainhead Apartments, of the 76th Street Widening Project. I. RECOMMENDED ACTION: By Motion: Accept the Condemnation Commissioners' Award on Parcel 5, Fountainhead Apartments, as part of the 76th Street Widening Project. III. BACKGROUND ~ The 76th Street Widening Project from I-35W to Penn Avenue required right of way acquisition from 14 parcels. One of those parcels, Parcel 5, is located at 7601 and 7611 Knox Ave and is known as the Fountainhead Apartments. The City has followed through the condemnation process using the Quick Take Method. The City has deposited with the Courts $411,100 for the takings on Parcel 5. The City was unsuccessful in negotiating the purchase of the necessary easements with the owners of Parcel 5. As a result, the City went through condemnation hearings with the owners of Fountainhead Apartments and the Court appointed Commissioners. The Commissioners have recently made their award of damages to the taking of easements on Parcel 5. The amount of the award is $807,700. 1210CommisAward convey Parcel 15 to the owners of Parcel 6. This conveyance was never completed. In the Stipulation of Settlement for Parcel 6, the City agrees to pay $9000 to the Sjostrands, the HRA agrees to pay $1500 for landscape improvements on Parcel 15, and the conveyance of Parcel 15 to the Sjostrands will be completed. Parcel 15 will be conveyed with all the necessary drainage and utility easements and right of way reserved for the City. III. BASIS OF RECOMMENDATION A. POLICY • The subject property was identified for partial acquisition for the Widening of 76th Street from I-35W to Penn Avenue. • Right of Way acquisition procedures set forth by the Minnesota Department of Transportation (MnDOT) and the Federal Highway Administration are being followed. B. CRITICAL ISSUES • Delaying the Stipulation of Settlement may delay negotiations on neighboring Parcel 7. . C. FINANCIAL • Funding for the purchase of right of way on the 76th Street Widening project is through the use of Municipal State Aid Street funds (gas tax revenues). D. LEGAL • The City's legal counsel, Robert Lindall, has written the attached Stipulation of Settlement. IV. ALTERNATIVE RECOMMENDATION(S~ • The Council may choose not to approve the proposed settlement. However this requires the City to continue with the condemnation process without much possibility of decreasing the City's expenses. V. ATTAC~Il~~IENTS • Stipulation of Settlement. • Right of Way Map of affected parcels. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • None anticipated. r~ LJ Case Type: Condemnation STATE OF MINNESOTA DISTRICT COURT COUNTY OF HENNEPIN FOURTH JUDICIAL DISTRICT City of Richfield, a municipal corporation under File No. CD-2632 Minnesota law, Petitioner, vs. STIPULATION OF SETTLEMENT The Church of St. Richard's of Richfield, et al. PARCELS 6 and 15 Respondents. THIS STIPULATION is made by and between Petitioner City of Richfield ("City"), Respondent The Housing and Redevelopment Authority in and for the City of Richfield ("HRA"), and Respondents Floyd Sjostrand and A.J. Sjostrand, dba Sjostrand Apartments, 7539 Penn Avenue South, Richfield, Minnesota ("Sjostrands"). I. RECITALS 1.01. Sjostrands are the fee owners of the real estate located at 7539 Penn Avenue South, Richfield, Minnesota ("Parcel 6" in this proceeding), and are claimants of an interest in the real estate located at 7545 Penn Avenue South, Richfield, Minnesota ("Parcel 15" in this proceeding); and 1.02. City is acquiring the real estate interests necessary to .enable it to improve and widen 76~' Street and Penn Avenue adjacent to Parcels 6 and 15 ("Project"); and 1.03. Sjostrands have claimed damages are owed them by the HRA and City arising out of the removal by the HRA of the former parking lot in the rear of Parcel 6 and construction of a new parking lot on Parcel 6 ("1999 Project"); and RJL-220033v1 1 RC145-448 . 1.04. The parties agree that the rights and interests described on Exhibit A ("Rights and Interests") are the rights and interests acquired by the City in this proceeding for purposes of the Project and that this proceeding is intended to settle Sjostrands' claims under the 1999 Project; and 1.05. The parties to this Stipulation have negotiated a full and final settlement of the instant action and the Sjostrands' claims relating to the 1999 Project, and in that connection desire to provide for compensation as provided. herein. II. AGREEMENT NOW, THEREFORE, in consideration of the premises and their respective promises, the parties hereto hereby agree as follows: 2.01. The foregoing recitals are incorporated into this Agreement.. 2.02. In settlement of any and all claims of Sjostrands in the above matter resulting from the taking by the City herein of the Rights and Interests for the .Project and to settle the claims of Sjostrands relating to the 1999 Project: (a) City agrees to pay Sjostrands $9,000 ("Settlement Amount"); and (b) HRA agrees to pay $1,500 (or so much thereof, if any, as may remain available from the Livable Communities Grant given by Metropolitan Council to the City or the HRA for reconstruction of the parking lot on Parcel 6) for landscaping improvements to be installed on Parcel 15 in accordance with a plan which is mutually agreeable to Sjostrands and the City's Project Engineer for the Project. 2.03. The parties agree that the Settlement Amount includes all amounts due and owing to Sjostrands in consideration for the taking of the Rights and Interests in this proceeding and the improvements to be constructed thereon as part of the Project, and in settlement of the Sjostrands' claims relating to the 1999 Project, including but not limited to, amounts due and owing for just compensation, interest and costs and disbursements, including appraisal and attorneys fees. To M . RJL-220033v1 2 RC 145-448 . implement this settlement, the parties stipulate that the court-appointed condemnation commissioners may. enter an award in the gross amount of the Settlement Amount in this action for the. acquisition of the Rights and Interests, naming Sjostrands as the respondents entitled to all damages awarded by the commissioners and with all other respondents receiving $-0-. 2.04. Provided: (a) that the commissioners make an award in the amount of the Settlement Amount to Sjostrands only; and (b) that no respondent appeals the award of commissioners, the City shall make direct payment of the Settlement Amount to Sjostrands and to any other respondents that may be named by the commissioners as beneficiaries of the award. Such payment shall be made within fifteen (15) days after the expiration of the period of appeal from the award. In the event that the award is other than the Settlement Amount, or the commissioners name other respondents as jointly being entitled to payment of the Settlement Amount, or Sjostrands or other respondents appeal the commissioners' award, the City may appeal such award and may also elect to make payment as provided by law by deposit of the funds into District Court. 2.05. When the City has made payment hereunder directly to Sjostrands, the City shall be entitled to any Quick Take deposit that has been made into District Court with respect to the acquisition of the Rights and Interests from Parcels 6 and 15, together with any interest that has accrued thereon, and the City may obtain an ex parte order of the Court which directs the court administrator to disburse to the City all such funds on deposit with the Court with respect to Parcels 6 and 15, including accrued interest thereon. 2.06. The parties each waive any and all rights to any further notices, viewings, or hearings regarding the instant condemnation action and in relation to the alteration of Parcel 6 by City and HRA as part of the 1999 Project. The parties also waive their rights to appeal from the .entry of the award of commissioners, unless the commissioners' award is other than the Settlement RJL-220033v1 3 RC 145-448 • Amount or any party appeals the commissioners award claiming they are entitled to a portion of the Settlement Amount. 2.07. Notwithstanding any other provision of this Agreement, unless waived in writing by either the ~4ty or HRA, this Agreement is contingent upon: (a) approval of the Richfield City Council; (b) approval of the Board of Commissioners of HRA; (c) issuance of a commissioners award consistent with the provisions of this Agreement; and (d) issuance of an order of the District Court amending the takings from Parcels 6 and 15 herein to be as provided in Third Amended Exhibit A attached hereto. RESPONDENTS ~~~~~'~ G F. C. Sjostrand ~, A.J. rostra Dated: ~~~' '2 ~ , 2002 RESPONDENT THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD By: • Its Executive Director Dated: _, 2002 RJL-220033v1 RC 145-448 PETITIONER CITY OF RICHFIELD By: Samantha Orduno, City Manager Dated: 2002 KENNEDY &GRAVEN 470 Pillsbury Center Minneapolis, MN 55402 Telephone: (612)337-9300 By: Robert J. Lindall (63277) ATTORNEYS FOR PETITIONER CITY OF RICHFIELD AND RESPONDENT HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD 4 THIRD AMENDED EXHIBIT A LEGAL DESCRIPTION OF REAL ESTATE INTERESTS TO BE ACQUIRED FROM PARCELS 6 AND 15 PARCEL 6: P.I.N.: 33-028-24-32-0038 (Abstract) PROPERTY ADDRESS: 7539 Penn Avenue South DESCRIPTION OF PROPERTY TO BE ENCUMBERED: The South 74 feet of the North 222 feet of the West 182 feet of the South One Quarter of the Northwest Quarter of the Southwest Quarter of Section 33, Township 28, Range 24, according to the United States Government Survey thereof and situate in Hennepin County, Minnesota. Subject to County of Hennepin Highway Easement as described in Hennepin County Recorder Document No. 6339618. DESCRIPTION OF EASEMENTS TO BE ACQUIRED: L A perpetual easement for roadway and utility purposes over, under, and across that part of the above described property which lies westerly of Line A described as commencing at the southeast corner of said property; thence North 89 degrees 58 minutes 31 seconds West, • along the south line of said North 222 feet a distance of .139.74 feet to the point of beginning of said Line A; thence North OS degrees 08 minutes 51 West 52.30 feet to a point in the east line of Hennepin County Highway Easement as described in Document No. 6339618 and said Line A there terminating. Said perpetual easement contains 110 square feet more or less. 2. A 5.00 foot temporary easement for construction purposes over, under, and across the south 57.40 feet of that part of said property which lies easterly of and adjacent to the above described Line A. Said temporary easement contains 287 square feet more or less. Said temporary easement shall commence on July 1, 2001 and shall expire December 31, 2002. 3. Anon-exclusive perpetual easement for vehicular ingress and egress over, under, and across the south 21 feet of the east 44 feet of the above described property which shall burden the above described property and benefit and be appurtenant to the real estate described as Parcel ?herein. Said easement shall include the right of the owners and encumbrancers of Parcel 7 from time to time to remove snow, resurface, re-stripe and otherwise maintain, repair and reconstruct the driveway improvements within the easement area. Said easement shall be subject to the duty upon the owners and encumbrancers of Parcel 7 from time to time to contribute proportionately to the cost of snow removal, resurfacing, re-striping, RJL-220033v 1 A-1 RC 145-448 • maintaining, repairing and reconstructing said driveway improvements within said easement area. Said perpetual easement contains 924 square feet more or less. For the .purpose of this description, bearings are oriented to the Hennepin County Coordinate System in which the west line of the Southwest Quarter of Section 33, Township 28, Range 24, bears North 00 degrees 13 minutes 20 seconds West. Notwithstanding the foregoing, the owners of Parcel ?shall not impede the ability of the owners of Parcels 6 and 15 to also use the easement area to obtain access to Parcels 6 and 15. Mitigation: In mitigation of the damages, if any, caused by the taking of the above easements from Parcel 6, Petitioner shall convey to the owners of Parcel 6, as their interests may appear, fee simple ownership of Parcel 15 described herein located at 7545 Penn Avenue South, subject to easements of record, subject to the easements specified in pages A-11 and A-12 hereof, and subject to non-exclusive permanent easements for driveway purposes over the easterly 44 feet of Parcel 15 and for snow storage purposes over and across the Westerly 36 feet of the Easterly 102 feet of Parcel 15, together with access thereto over the west 22 feet of the east 66 feet of Parcel 15, for the benefit of Parcel 7 herein located at 7544 Oliver Avenue, Richfield. Access will be provided between the above described property and adjacent public streets at substantially all times throughout the term of the above temporary easements. Description of Parties Known or Thought to Have an Interest in Said Property Name Nature of A arent Interest F.C. Sjostrand and A.J. Sjostrand Fee Owner All other parties unknown, together with unknown heirs or devisees ands ouses, if any Any right, title or interest in the Subject Pro erty Notwithstanding the foregoing attempt to identify all interests held by a party named herein, it is Petitioner's intention herein to encumber all interests owned by the named respondents in the above-described real estate. • RJL-220033v I A-2 RC 145-448 PARCEL 15: P.I.N.: 33-028-24-32-0037 PROPERTY ADDRESS: 7545 Penn Avenue South DESCRIPTION OF PROPERTY TO BE ENCUMBERED: (per Document No. 6829567) That part of the West 182 feet of the South One Quarter of the Northwest Quarter of the Southwest Quarter of Section 33, Township 28, North Range 24 West of the Fourth Principal Meridian, lying South of the North 222 feet thereof, according to the Government Survey thereof. DESCRIPTION OF LAND TO BE CONVEYED TO OWNERS OF PARCEL 6: That part of the above described property which lies northerly of the following described Line A: Commencing at the northeast corner of said property; thence South 00 degrees 13 minutes 20 seconds West, along the east line of said West 182 feet, a distance of 43.29 feet to the point of beginning of Line A to be described; thence North 77 degrees 49 minutes 32 seconds West a distance of 45.31 feet; thence North 88 degrees 46 minutes 40 seconds West a distance of 63.51 feet; thence northwesterly 47.19 -feet along a tangential curve, concave to the northeast, having a radius of 32.33 feet and a central angle of 83 degrees 37 minutes 49 seconds; thence North OS degrees 08 minutes 51 seconds West 3.02 feet to a point in the north line of the above described • property distant 139.74 feet west of said northeast corner and said line.there terminating. Subject to a permanent easement in favor of the City of Richfield for drainage and utility purposes over, under and across that part of said property lying within 10.00 feet northerly and easterly of and adjacent to the herein described Line A. Subject to the following described easements for the benefit of Parcel 7 herein (located at 7544 Oliver Avenue, Richfield, MN, and which shall be appurtenant to said Parcel 7) which Petitioner shall convey to the owners of Parcel 7, as their interests may appear: A non-exclusive perpetual easement for driveway purposes over and across the easterly 44 feet of Parcel 15 herein (located at 7545 Penn Avenue South, Richfield, MN) subject to existing easements, if any. Said easement shall include the right of the owners and encumbrancers of Parcel 7 herein (located at 7544 Oliver Avenue South, Richfield, MN) from time to time to remove snow from, resurface, re-stripe and otherwise maintain, repair and reconstruct the driveway improvements within the easement area. Said easement shall be subject to the duty upon the owners and encumbrancers of said Parcel 7 from time to time to contribute proportionately to the cost of snow removal, resurfacing, re-striping, maintaining, repairing and reconstructing said driveway improvements. 2. Anon-exclusive perpetual easement for snow storage purposes over and across the west 36 feet of the east 102 feet of said Parcel 15 herein, subject to existing easements, if any together • with access thereto over the west 22 feet of the east 66 feet of Parcel 15. Said easement shall include the right of the owners and encumbrancers of said Parcel 7 from time to time to RJL-220033v 1 A-3 RCI45-448 . remove snow from Parcel ?and the driveway easements over Parcel 6 and Parcel 15 and store snow within the snow storage easement area. Said easement shall be subject to the duty upon the owners and encumbrancers of Parcel ?from time to time to contribute proportionately to the cost of snow removal from said easement area. For purposes of this description, bearings are oriented to the Hennepin County Coordinate System in which the west line of the Southwest Quarter of Section 33, Township 28, Range 24, bears North 00 degrees 13 minutes 20 seconds West. Notwithstanding the foregoing, the owners of Parcel ?shall not impede the ability of the owners of Parcels 6 and 15 to also use the easement area to obtain access to Parcels 6 and 15 and to park on the west 22 feet of the east 66 feet of Parcel 15. Nor shall the owners of Parcels 6 or 15 impede the ability of the owners of Parcel ? to access and use the snow storage easement area. Said area to be conveyed to Parcel 6 is 4,612 square feet more or less. Said permanent drainage and utility easement contains 1,550 square feet more or less. Description of Parties Known or Thought to Have an Interest in Said Property • • Name Nature of A arent Interest Housing and Redevelopment Authority in and Fee Owner for the City of Richfield F. C. Sjostrand and A. J. Sjostrand, d/b/a Claimants of an interest Sjostrand A artments Notwithstanding the foregoing attempt to identify all interests held by a party named herein, it is Petitioner's intention herein to encumber all interests owned by the named respondents in the above-described real estate. RJL-220033v1 RC145-448 A-4 • • • ~, ~ ~_ ~- C ~. I r I n O C Z 2 I, I I ~ ~ ~ ~ ~ _ w w ~ ~ ~! ~ w w da. 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I I I I N I _ o°oW~o L------J --- --- NO ~:»~ / ®ao~< x NB PENN AVE -X11-_- !_ ~ LL N O SB PENN AVE ~ X 0 0 N ~ N S •o ~ r---- O O ~ ~ ,,, O I nJ SO[Gi0 20[9[/90 W9<.ox[9[xx9d to [ae>~./ww.w3S000099MirLn!.~SN AGENDA SECTION: ~ Se.~ 1 AGENDA ITEM # ~, REPORT # ~ ~ (p STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, 2002 • REPORT PREPARED BY: REPORT PRESENTER: DEPARTMENT DIRECTOR REVIEW: !~/ REVIEWED BY CITY MANAGER: JIM OLSON, PROJECT ENGINEER Nauc TITLE MIKE EASTLING, PUBLIC WORKS DIRECTOR NAME, TITLE ITEM FOR COUNCIL CONSIDERATION: Consideration of Stipulation of Settlement on Parcel 6 for the 76th Street Widening Project. RECOMMENDED ACTION: By Motion: Approve the Stipulation of Settlement on Parcel 6 of the 76th Street Widening Project between the City, the HRA and the Sjostrands (owners). III. BACKGROUND ~ The 76th Street Widening Project from I-35W to Penn Avenue required right of way acquisition from 14 parcels. One of those parcels, Parcel 6, is located at 7539 Penn Avenue and is owned by the Sjostrands. The City has followed through the condemnation process using the Quick Take Method. The City has deposited with the Courts $2,200 for the takings on Parcel 6. The City has now reached a settlement with the owners of Parcel 6. The parcel adjacent and immediately south of Parcel 6 is Parcel 15. Parcel 15 is vacant and owned by the HRA/City of Richfield. Ina 1999 HRA project a new parking lot was constructed with common drive accesses for four apartments located on the 7500 block of Penn and Oliver Avenue. Parcel 15 was also one of the properties included in that project. As part of that project the HRA was to 1210SjostrandSti pAgrmt The City Council has previously passed two resolutions related to the right of way acquisition on the 76th Street Widening Project. On February 12, 2001, Council approved a resolution providing just compensation and authorizing purchase of the partial acquisition on Parcel 5 in the amount of $411,100. On March 12, 2001, Council approved a resolution authorizing the condemnation of Parcel 5 and other parcels if those properties could not be acquired voluntarily. The City Attorney, Robert Lindall, and City Staff are recommending that Council accept the award and not appeal. However, should the owners of Fountainhead appeal, the City will also appeal. Should the Commissioners' Award be appealed, a jury will then hear evidence and then make their determination of damages. The attached letter from the City's Attorney gives a detailed description of the award and a comparison of the City's and Owner's appraisals to the award. III. BASIS OF RECOMMENDATION A. POLICY • The subject property was identified for partial acquisition for the Widening of 76th Street from I-35W to Penn Avenue. • Right of Way acquisition procedures set forth by the Minnesota Department of Transportation (MnDOT) and the Federal Highway . Administration are being followed. B. CRITICAL ISSUES • Appeal by either party, the City or the Owners, must be filed by December 29, 2002. C. FINANCIAL • Funding for the purchase of right of way on the 76th Street Widening project is through the use of Municipal State Aid Street funds (gas tax revenues). • The increase in right of way costs on this project has been anticipated. Staff has planned to fund these increased costs with Municipal State Aid funds from the 2003 and 2004 allotments. Council Memorandum No. 137 was present to the Council on October 22, 2002 which reflected the need for additional Municipal State Aid Street funds (gas tax revenue) to cover all of the 76th Street Widening Project costs. The financial status report from the memorandum is attached. • The City will eventually get back 75% of the right of way costs from the State through an increase in the City's annual allotment of Municipal State Aid funds. The City will receive an increase in the allotment equal to 5% of the right of way costs for the entire project for each of the next 15 years. • D. LEGAL • The City's legal counsel, Robert Lindall, has presented his findings and recommendation in his attached letter dated November 26, 2002. IV. ALTERNATIVE RECOMMENDATION(S~ • The Council may choose not to accept the Award of Commissioners and direct staff and legal counsel to appeal. The award of damages would then be determined by a jury. The City's legal counsel feels that the Commissioners have better judgment and experience in making awards than risking a possible increase in the award which could be made by an inexperienced jury. V. ATTACHMENTS • Map of easement • Letter from Robert Lindall, Kennedy and Graven. • Financial status report VI. PRINCIPAL PARTIES EXPECTED AT MEETING • None anticipated. • • --+~- ~ -fl - ~ 1--1 O '9 z m .. ~ W D O ~ ~ O N C7 O ~ m = -- m N TI N Ir ~ (n w m z a r o o v x o- o m z ' ~ I I v 1 o ~ i c m ~ I I -• v a v m m m v m y v ~ ° v x o z m ~ v o o vl ~ a s w o A n m A n r m m m m m 2 N fl'i m m = z Z z z i c O -+ 11 -1 n N ~ ~• W ~f O a m a m 2 m w ~ N r vl D a ~ m ~ p ~ ti ~ H m Z ~ y n m S o J . /- A LINE 170 F EAST OF EAST L INE OF .•c T 5 RE Si I ~ I I .WEST LINE OF N. 1 A ES i~ ,I :~ K 0 AVE. I( - w ~ -- - ---253.01--- ° ---- ~ 30. 30.00 '~3.0 ~ --- --- - _7-- - .69- I ---132.06 - ~-92.30 ~~I~S~:_ _ ~ 1 m -~ o ~w 9 ='~l ,9r 33 o A ° °. 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O i 76th Street Widening Project Financial Status Report As Of September 30, 2002 Budget Variance City of Richfield City of Richfield (Over) Funding Sources Budget Actual Under MSA Funds $ 5,900,000.00 $ 3,435,108.91 $ 2,464,891.09 Utilities/Best Buy Funds $ 500,000.00 $ 200,000.00 $ 300,000.00 Total $ 6,400,000.00 $ 3,635,108.91 $ 2,764,891.09 Uses ROW $ 1,200,000.00 $ 790,669.09 $ 409,330.91 Engineering Services $ 1,160,000.00 $ 1,088,432.86 $ 71,567.14 Road Construction $ 3,936,600.00 $ 3,205,160.80 $ 731,439.20 Labor Costs-Admin. $ 80,000.00 $ 78,360.89 $ 1,639.11 Total $ 6,376,600.00 $ 5,162,623.64 $ 1,213,976.36 Net Variance $ 1,550,914.73 • '` Kennedy Graven 470 Pillsbury Center 200 South Sixth Street Minneapolis MN 57402 (612) 337-9300 telephone (612} 337-9310 fax hnp:/lwww kennedy-graven.com ROBERT J. LINDALL Attorney at Law Direct Dial (612) 337-9219 Reat Property Law Specialist, Certified by Minnesota State Bar Assn. CONFIDENTIAL -ATTORNEY/CLIENT PRIVILEGED COMMUNICATION November 26, 2002 Jim Olson Department of Public Works City of Richfield 6700 Portland Avenue South Richfield, MN 55423 Re: City of Richfield v. The Church of St. Richard's of Richfield, et al. Hennepin County District Court File No. CD-2632 Parcel 5 - 7601 Knox Avenue South -Fountainhead Apartments("Fountainhead Property") Dear Jim: This matter was commenced to obtain easements for the widening of 76th Street between I-35W and Sheridan Avenue South. Enclosed herewith is the Award of Commissioners which was filed in the office of the District Court Adnunistrator on November 19, 2002, with respect to Parcel 5 ("Fountainhead Apartments")_ It is in the amount of $807,700. The date of taking (and, therefore, the date of valuation) was June 28, 2001. The commissioners appointed by the district court to determine the amount of damages in this matter ("Commissioners") were John Harrigan, a lawyer, Sherman Malkerson, a commercial real estate broker, and Philip Smith, a real estate appraiser. The Fountainhead owners ("Owners") were represented by Christopher Hayhoe of Felllaber, Larson, Fenton & Vogt, P.A. in Minneapolis. The Fountainhead Property is owned collectively by five different Owners, two of them represented by Christopher Hayhoe, and three by Joseph Christensen. However, for the purpose of the condemnation hearings, Hayhoe represented all five Owners. The Commissioners held 15 hearings for the purpose of hearing evidence related to the damages . caused by the takings from Fountainhead. Hearings were held at Richfield City Hall in the council chambers with Jim Olson or Tom Faley attending most of the hearings. __..__m__ RJL-223873v1 ` Ql~ ~ Y ~~Q7 RC 14~-~8 w,. Tim Olson Ltr November 26, 2002 Page 2 The takings from Fountainhead were for the purpose of widening 76"' Street, improving Knox Avenue immediately south of the intersection of Knox Avenue and 76`h Street, closing the north entrance of the 7601 Knox property to Knox Avenue and constructing a new entrance drive to 7601 Knox about 220 feet south of the previous access paint. A permanent road easement was taken from Fountainhead, containing 7,497 square feet, divided between two locations. One location was along the north edge of the site, including the northwest corner, resulting in the removal of a garage building containing 20 stalls and construction of a retaining wall to support the embankment for widened 76`x' Street. Tile other location is a strip of land along Knox Avenue about 313 feet south of the original northwest corner. The takings also included a temporary construction easement containing 34,637 square feet, for a term of 18 months. The purposes of the temporary easement were to 1) remove, replace and re- stripe disturbed pavement in the parking lot and drive aisles to the north of the 7601 and 7611 Knox buildings (the buildings at the northwest and northeast corners of the Fountainhead Property, respectively); 2) create a new drive aisle on the Fountainhead Property that leads from the new entry on I~iox, northward and around the northwest corner of the 7601 building; 3) install a serpentine screening wall along the new drive aisle along the west side of the 7601 building; and 4) re- landscape and/or grade the west fringes of the Fountainhead Property so they blend with reconstructed Knox Avenue. • During the term of the temporary construction easement, it was understood that the new north entrance drive would not be functional until near the end of the construction project. In addition, the drive aisle from the old north entry was closed to traffic on occasion and no parking stalls on the north side of the 7601 and ?611 buildings were available for use. However, the temporary loss of parking stalls (20 garages and 45 striped stalls). was mitigated during the temporary easement by the City obtaining use of 70 parking stalls on the north end of the Galyans property located to the south of the Fountainhead Property, for use by Fountainhead tenants, without charge to them. The paved area to the north of the 7601 building was striped to accommodate 22 parking stalls (where the 20 garages used to be} and. the 45-stall parking lot to the north of the 7611 building was striped to accommodate a1145 stalls again. Garages are not planned to be rebuilt at this time. If constructed, any cost would be paid for by the Owners. Before the taking, there were 20 garages and 45 open parking stalls. After the taking, there are no garages and 67 open stalls, resulting in a loss of income-producing garage stalls, but a net gain of two parking spaces overall. The Owners claimed that the takings had caused them damages totaling $1,790,000. To support their claim, they presented testimony from Arlene Dixson, President of Highland Management, management agent for Fountainhead ("Highland"); Sandra Mamotti, CPA and Vice President for Finance of Highland; Mary Schweiss, Vice President of Property Management, Highland; Maly Bujold, President of Maxwell Research, real estate broker and consultant; and Scott Ruppert, MAI real estate appraiser and broker. • RJL-223873v1 RC 14~-4~i8 ""~ Jim Olson Ltr November 26, 2002 Page 3 hi its responsive case,. the City presented testimony from the following witnesses: Tom Foley, City Transportation Engineer, Jim Olson, City Project Engineer, Rodger Skare, MAI, real estate appraiser, and Jason Messner, MAI, real estate appraiser. A major issue in the case was whether the project causing damage to Fountainhead was the 76tH .Street widening project or the larger Best Buy project. The City argued that the project causing the damages was the 76t" Street widening, that it was a separate project which had been planned by the City since the mid 1980s or before, and that the City had planned for some time to undertake it as soon as money became available for that purpose. The Owners argued that the environmental impact statement ("EIS") prepared by Best Buy for the Best Buy project and approved by the City Council indicated that the 76th Street widening, the Penn Avenue bridge project and the closing of 78th Street would not occur until approximately 2011 without the Best Buy project proceeding. What was surprising to us about this argument was that the Owners were arguing that Fountainhead (a 150-unit apartment property) would be worth less, being located across from a corporate headquarters complex where an estimated 7,500 employees (all of them being potential renters) would be working than if Fountainhead were instead located across the street from car dealerships, and older commercial and industrial buildings (as in the before condition). The award includes the following paragraph indicating that the Commissioners concluded that the project causing impact to the Fountainhead property was the Best Buy project: • First, the commission finds that both parties have valid arguments regarding the scope and definition of "the Project", but, it appears to the objective observer that the Best Buy Project and the street widening project are so closely related to one another that it is impossible to tell them apart. The street widening, while on the drawing board for years, would not have been done at this time without the substantial influence of the Best Buy Project, the same can be said of the closure of 78th Street and the reconstruction of the new Penn Avenue Bridge area. By agreement, the Commissioners' Award allocated damages among the permanent easement, the temporary easement, the costs of curing improvements affected by the takings, and other severance damages. The damages awarded by the Commissioners for the loss of the permanent easement were $97,500. As indicated above, the area of the permanent easement was 7,497 square feet so this indicated damages of $13.00 per square foot of land area affected by the permanent easement. The easement enables the City to occupy the area affected by the easement permanently with public improvements, including street and retaining wall improvements, so the Owners will permanently lose all right to use this property. Thus, the taking of a permanent easement can be effectively the same as taking,fee simple title to the area subject to the easement. Ruppert, the Owners' appraiser, concluded that the Fountainhead land had a value of $12.50 per • square foot. Skare and Messner, the City's appraisers, were of the opinion that the land had a value of $15.00 per square foot and $11.94 per square foot, respectively. The average of their opinions RJL-223873v1 RC 14>-448 ~ Jim Olson Ltr November 26, 2002 Page 4 n U was $13.19 per square foot. Thus, the Commissioners' Award was substantially consistent with the opiiuons of the appraisers. The Commissioners awarded $75,000 for the temporary easement. As indicated above, the temporary easement contained 34,637 square feet, and was for a period of 18 months. Usually, damages are awarded for a temporary easement based upon the rental value of the affected area for the term of the easement period. In the present case, it appears that the Commissioners assumed that the land had a value of $13.00 per square foot and could be rented at a rate of 11% of value per year, indicating damages for the temporary easement in the amount of $74,296 (which the Commissioners rounded to $75,000). This was consistent with the opinion of the Owners' appraiser (Ruppert). Skare and Messner had not expressed a separate opinion of damages for either the permanent easement or the temporary easement, since it was their position that appropriate appraisal methodology would call for them to simply express an opinion of the value of the total property before the taking and after the taking. The difference in value then indicates the damages caused by the taking, inclusive of those attributable to the permanent easement, the temporary easement and any severance damages. The Owners had claimed that they would be forced by the Best Buy project (including the street widening) to incur $317,219.65 as costs to cure damages to replace or restore the utility of improvements on the Fountainhead Property which were impacted by the takings. Among the items which the Owners asserted to be part of this were: replacement of lighting, replacement of garages, replacement of pylon sign, wall sign, rental sign, banner sign and directional signs, replacement of dumpster enclosure, repair of irrigation system, landscape repairs, pressure wash buildings, remove, clean and reinstall air conditioners, wash all windows, pre and post-construction structural evaluation of all buildings, carpet cleaning and install curb bumpers. Ruppert, the Owners' appraiser, reduced this amount for the purpose of his own estimate of the cost of these items, to $300,000. Skare estimated the cost of these amounts to be $122,000 (not recognizing all of the items as being compensable). Messner expressed the opinion that the Owners were entitled to $55,000 in cost of cure (not recognizing many of the Owners' items as being compensable). The average of the appraisers' estimates was $162,587. The Commissioners awarded $85,200 as costs of cure. The amount awarded by the Commissioners for costs of cure suggests to me that they were persuaded by Messner that it was not economically feasible for the Owners to replace the garages because Fountainhead was experiencing a 20% vacancy in rental of garages previous to the taking. He reached this conclusion even though his belief was that the cost of replacement of the garages was considerably less than claimed by the Owners. Before the taking, the Owners used an empty garage enclosure for collection of trash from the 7601 building. The City's appraisers argued that many apartment buildings simply use a trash enclosure having 5-foot walls and no roof so that it was inappropriate for the Owners' cost of cure to assume the need to replace the trash enclosure with a covered structure and particularly not one as expensive as was assumed by the Owners' estimate from a contractor who vas not presented to testify. The Owners' cost of cure claim also included several signs that had not existed before the taking. The Commissioners apparently agreed with the City on most of these points. • }2.IL-3238?3vi RC 145-448 ~. • • • Jim Olson Ltr November 26, 2042 Page 5 The Commissioners also awarded $550,000 other "severance damages". The Owners had claimed that they would be obliged to reduce the rent in all of their units during the Best Buy construction project and that, despite having done so, they would incur substantially increased vacancy during the construction project. They also asserted that the Fountainhead Property would never again attain the rent levels which they would have reached had the Best Buy project never occurred. In contrast, the City's appraisers were of the opinion that rents at Fountainhead would recover to normal market levels immediately, or soon after, completion of the street widening project. The Owners also claimed that units on the north side of Fountainhead, looking toward 76`'' Street, would always suffer from diminished rents due to tenants being obliged to look at the new retaining wall conshucted by the City at the edge of the 76`I' Street right of way, as compared to the grass and trees which were previously located in that area. Similarly, the Owners claimed that units in the west side of the lowest level of the 7601 building (Units 114 through 118) would permanently incur diminished rent and increased vacancy due to adjacency to the serpentine wall which the City agreed to construct between the new access drive and the building. In order to close the old north entrance to the property due to its proximity to the 76~' and Knox intersection, the City constructed a new driveway from a point 220 feet south of 76~' Street diagonally along the west edge of the 7601 building to the parking lot north of the 7601 building. The wall was requested by the Owners in order to protect occupants of the units from headlights that might result from cars approaching from southbound Knox and then entering the driveway. The wall is planned to be between 4-5 feet high and will vary in distance from the building from approximately four feet at the northwest corner of the building to over 20 feet at the southwest end of the wall. As a result, it will not deprive tenants of all views from those units. Because the serpentine wall was not installed prior to the end of the temporary easement, the City installed sod and six trees to screen the units which would be most affected by headlights prior to construction of the wall. Those were Units 1.14 and 118, located at the northwestern corner and southwestern corner of the first floor of the 7601 building. The City's staff proposes that the City and the Owners agree upon a 30-day temporary easement to begin upon written notice from the City engineer and to expire on or before June 30, 2003, for a minimal area absolutely necessary to construct the wall (but substantially smaller than the original temporary easement) to be granted by the Owners and for the Commissioners to enter a supplemental award of damages for this extended temporary easement if the parties are not able to agree upon the damages for this easement. The Owners may also claim that they have incurred additional construction disturbance damages due to rent loss (especially in Units 114-118} due to delay in completion of the wall. The damages recognized by the various appraisers and awarded by the Commissioners for the Owner's various claims are as follows: Ruppert Skare Messner Average (Appraiser (Appraiser (Appraiser of Commissioners' Item for Owners) for Ci for Ci Appraisers Award Temporary easement $ 75,000 $ 85,725* $ 75,000* $ 78,575* $ 75,000 Permanent easement $ 97,500* $112,455* $ 97,500* $102,485* $ 97,500 R.iL-223373v1 RC14~-443 ~,: Jim Olson Ltr ' November 26, 2002 Page 6 • • • Item Cost of cure Other Total Damages: * Inferred Ruppert (Appraiser for Owners) $ 300,000 $1,317,500* 1.790.000 Skare Messner (Appraiser (Appraiser for Ci for Ci $122,000 $ 55,000 $194,820* $247,500* ~51~ 00 475 Average of Commissioners' A~uraisers Award $159,000 $ 85,200 $586,606* $550,000 ~2.2f ~7 x$97:Z2Q The difference between the Owners' appraiser's opinion of $1,790,000 and the highest City appraiser's opinion of $515,000 was $1,275,000. The Commissioners' Award exceeded the highest City appraiser's opinion by $292,700. Thus, it could be said that the Owners obtained $292,700 (or 23.0%} of the amount in dispute. Either party may appeal the Commissioners' Award by filing and serving a Notice of Appeal upon the other party within 40 days following filing of the Commissioners' Award. The time for appealing will therefore expire on or about December 29, 2002. If either side appeals, the other side must appeal or lose the opportunity to argue that the award (in the case of the City) should have been less than the Commissioners' Award. Therefore, if the Owners appeal, I will file across- appeal on behalf of the City. However, I will not appeal unless the Owners appeal or you tell me that I should file a Notice of Appeal. I recommend that the City not appeal the Commissioners' Award unless the Owners do. Please submit the Commissioners' Award to the City Council to seek direction as to whether we should appeal on behalf of the City. If you have any questions about this matter, please let me know. Thank you for the opportunity to serve the City in this matter, and thanks to you and Tom Foley for all of your assistance. Very truly your , Robert J. Lindall RJL:peb cc: Jason Messner Rodger Skare Corrine Thomson John Dean John M. LeFevre, Jr. 12JL-223873v1 KC 145-448 AGENDA SECTION: ~ ~~~ I'~` AGENDA ITEM # ~-] A REPORT # ~ g 4 ~' STAFF REPORT CITY COUNCIL MEETING DECEMBER 10, .2002 • REPORT PREPARED BY: REPORT PRESENTER: DEPARTMENT DIRECTOR REVIEW: REVIEWED BY CITY MANAGER: BRUCE SYLVESTER, ZONING ADMINISTRATOR NAME, TITLE BRUCE PALMBORG, COMMUNITY DEVELOPMENT DIRECTOR N~ TITLE ITEM FOR COUNCIL CONSIDERATION: City Council confirmation of City Manager's reappointment of a Hearing Examiners Connie Murray and Paul Wasko. I. RECOMMENDED ACTION: By Motion: Confirm the City Manager's reappointment of Connie Murray and Paul Wasko for two-year terms as Hearing Examiners. III. BACKGROUND ~ The hearing officer procedure was established by the City Council in 1985 to hear and decide requests for variances from the literal provisions of the Zoning Ordinance where unique circumstances and undue hardship are present. City ordinance provides for the appointment of Hearing Examiners by the City Manager subject to confirmation by the City Council (546.09 Subdivision 2). The terms of the two current Hearing Examiners-Connie Murray and Paul Wasko-expire December 31, 2002. 1210-AppointHearExam iners III. BASIS OF RECOMMENDATION A. POLICY • Both Ms. Murray and Mr. Wasko have experience, training and knowledge in land use issues and warrant reappointment. • Ms. Murray has served as a Hearing Examiner since 1985 and has expressed a willingness to serve for another two-year term. • Mr. Wasko has served as a Hearing Examiner since 1997 and has expressed a willingness to serve for another two-year term. B. CRITICAL ISSUES • N/A C. FINANCIAL • N/A D. LEGAL • N/A IV. ALTERNATIVE RECOMMENDATION(S~ • Defer confirmation to a later Council meeting. • • Deny confirmation of the appointment. V. ATTACHMENTS • N/A VI. PRINCIPAL PARTIES EXPECTED AT MEETING • N/A •