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05-30-00 agendaCITY OF RICHFIELD, MINNESOTA SPECIAL CITY COUNCIL MEETING TUESDAY, MAY 30, 2000 6:45 P.M. COUNCIL CHAMBERS 6700 PORTLAND AVENUE AGENDA CALL TO ORDER ROLL CALL 1. CONSIDERATION OF RESOLUTION ESTABLISHING JUST COMPENSATION AND AUTHORIZING PURCHASE OF 6521 CEDAR AVENUE FOR 66TH STREET/TRUNK HIGHWAY 77 INTERCHANGE PROJECT STAFF REPORT NO. 137 2. CONSIDERATION OF RESOLUTION AUTHORIZING CONDEMNATION OF COMMERCIAL PROPERTY AT 6521 CEDAR AVENUE FOR THE 66TH STREET/TRUNK HIGHWAY 77 INTERCHANGE PROJECT STAFF REPORT NO. 138 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 861-9702. 0 REPORT # 138 STAFF REPORT CITY COUNCIL MEETING • MAY 30, 2000 _..: ..,. KATLA 1VIEDVETSKI, __.,.REPORT PREPARED BY: REDEVELOPMENT SPECIALIST NAME, T/TEE BRUCE PALMBORG, REPORT PRESENTER: COMMUNITY DEVELOPMENT DIRECTOR NAnar_, Tires DEPARTMENT DIRECTOR REVIEW: REVIEWED BY CITY MANAGER: TIRE ITEM FOR COUNCIL CONSIDERATION: Consideration of a resolution authorizing condemnation of a commercial property at 6521 Cedar Avenue for the 66th Street/T. H. 77 Interchange Project. I. RECOMMENDED ACTION: By Motion: Approve a resolution authorizing condemnation of a commercial property at 6521 Cedar Avenue for the 66th Street/T. H. 77 Interchange Project. III. BACKGROUND The property located at 6521 Cedar Avenue has been identified for purchase for the 66th Street/ T. H. 77 Interchange Project (Project). Dr. Luanne Wendland, property owner and operator of the Animal Care Clinic at 6521 Cedar Avenue, has requested priority processing status because of her imminent purchase of a replacement property. In order to assist Dr. Wendland, staff has been working with legal counsel to explore alternatives in making a purchase offer for the property reflecting the circumstances. Dr. Wendland and her legal counsel have concurred to following a dual track process for the property acquisition at the same time. The first track is that of the City's traditional offer for purchase; the second, acquisition by eminent domain (quick take condemnation) allowing adequate time for full negotiations prior to the filing. ,i 0530cedar Should there be a disagreement, by pursuing both tracks simultaneously, a mechanism would be provided for Dr. Wendland to receive the sale proceeds quickly so as to assist her with the purchase of the replacement property. 0 1 III. BASIS OF RECOMMENDATION A. POLICY The City has legal authority to acquire private property by eminent domain for a public purpose. The subject property has been identified for purchase for the Project. The Memorandum of Understanding between the City, the Minnesota Department of Transportation ,(MnDOT) ,and. ,the- Metropolitan Airports Commission (MAC) outlines the responsibilities of each-agency as to property acquisition and construction. Right-of-way acquisition procedures set forth by MnDOT are being followed. B. CRITICAL ISSUES I • Condemnation action will allow Dr. Wendland to receive a significant portion of the sale proceeds while the value of the property is established through the legal process. C. FINANCIAL MAC is obligated to fund the purchase process. • D. LEGAL I The City's legal counsel, Robert Lindall, has been working with staff and consultants on this case. E. TIMING I Approval of the condemnation resolution on May 30 will permit Dr. Wendland to receive the amount of just compensation in a timely manner, should there be a disagreement on value. IV. ALTERNATIVE RECOMMENDATION(S) • Delay approval of just compensation. • Do not approve just compensation. V. ATTACHMENTS Resolution authorizing and directing the condemnation of certain property for street purposes. VI. PRINCIPAL PARTIES EXPECTED AT MEETING N/A 0 RESOLUTION NO. RESOLUTION AUTHORIZING AND DIRECTING THE CONDEMNATION OF CERTAIN PROPERTY FOR STREET PURPOSES WHEREAS, the City Council of the City of Richfield is the official governing body of the City of Richfield; and WHEREAS, the City of Richfield, Minnesota, a municipal corporation, acting by and through its City Council, is authorized by law to acquire land needed for public use or purpose; and WHEREAS, according -to-: the, Environmental Impact Statement-for. the new North- South runway to be built by the Metropolitan Airports Commission, the interchange of T.H. 77 and 66th Street requires upgrade; and WHEREAS, the layouts of the new interchange will accommodate the increased traffic generated by the new air cargo facility and the redevelopment planned for the east side of Richfield consistent with the City's Airport Mitigation Plan. WHEREAS, the plan and design for the 66th Street and T.H. 77 Interchange Project (Project) require that the real estate described herein be acquired to implement the Project; and WHEREAS, the City Council finds that it is reasonable, necessary, proper and convenient, for a public purpose, and.in the interest of the public health,. safety, convenience, and general welfare of the citizens of the City that title to and possession of the real estate hereinafter described be.acquired in furtherance of the Project; and WHEREAS, the City Council finds that the funding and construction schedule for the Project make it necessary to acquire title and possession of the real estate hereinafter described prior to the filing of the final report of the condemnation commissioners to be appointed by the district court. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield, Minnesota, that it is the considered judgment of the Council that the property described in Exhibit A attached hereto and incorporated herein, be acquired in fee simple absolute for the stated public purposes, and that it be acquired, if necessary, through the exercise of the power of eminent domain. BE IT FURTHER RESOLVED, that in the event the City Attorney determines that voluntary acquisition is not likely to be achieved upon terms substantially consistent with the City Council's determination of just compensation after the owner has had reasonable opportunity to consider the City's offer of just compensation, the City Attorney is hereby authorized and directed to take all steps necessary to acquire said real estate by use of eminent domain proceedings, negotiation of early entry authorizations, and the use of the quick take procedure as provided by Minn. Stat. § 117.042, pursuant to the City's approved appraisal of value for said real estate as determined in the City Council's resolution establishing just compensation for said property. Adopted by the City Council of the City of Richfield, Minnesota this 30th day of May, 2000. • Martin J. Kirsch, Mayor ATTEST: Thomas P. Ferber, City Clerk 0 0 EXHIBIT A • Description of Property: Street Address: 6521 Cedar Avenue South, Richfield, Minnesota (PID No. 25-028-24-23-0004) Legal Description of Property: Lot -6 and the. South. 30 feet of Lot 5, Block--1,-New Ford. Town. Addition, Hennepin County, Minnesota Together with all abutting streets and alleys, vacated or to be vacated, and all easements, gaps, overlaps and gores, appurtenant thereto. is • 0530cedar REPORT # 1 17 0 da STAFF REPORT CITY COUNCIL MEETING MAY 30, 2000 KATIA MEDVETSKI, REPORT PREPARED BY: REDEVELOPMENT SPECIALIST NAME, TITLE BRUCE PALMBORG, REPORT PRESENTER: COMMUNITY DEVELOPMENT DIRECTOR NAME, TITLE DEPARTMENT DIRECTOR REVIEW: REVIEWED BY CITY MANAGER: / SIGNATI 1 ITEM FOR COUNCIL CONSIDERATION: Consideration of a resolution establishing just compensation and authorizing the purchase of 6521 Cedar Avenue for the 66th Street / TH 77 Interchange Project. 11 I. RECOMMENDED ACTION: By Motion: Approve a resolution establishing just compensation and authorizing the purchase of 6521 Cedar Avenue for the 66th Street / TH 77 Interchange Project. II. BACKGROUND On February 28, 2000, the City Council approved a Right of Way Agreement with the Metropolitan Airports Commission (the "MAC") which provides for the acquisition of properties impacted by the expansion of 66th Street and Trunk Highway 77 (the "Project"). Dr. LuAnne Wendland, property owner of 6521 Cedar Avenue and operator of the Animal Care Clinic, has requested priority processing status and requested that an offer be made to her by May 31, 2000 because of her imminent purchase of a replacement property. Appraisal reports were prepared for the real estate, movable personal property and immovable fixtures and equipment (fixtures) with values as follows. 0530justcomrev Appraisal Firm I Appraisal I Amount Bakken, Lied, Janssen, Day & Reach, Inc. I Real Estate 1 $535,000 Patchin Messner Appraisals, Inc. I Real Estate 1 $480,000 Bettendorf Rohrer Knoche Wall, Inc. I Fixtures 1 $ 25,870 The review appraiser for the real estate, Scott Ruppert of Ruppert & Ruppert Associates, Inc. has recommended $535,000 as just compensation for the real estate. At this writing, Robert Pelton of C R Pelton Associates, review appraiser of the fixture report, has not yet provided staff with his recommendation. This information will be presented to the City Council at the time of the meeting on May 30tn MAC has provided the final review for the real estate and has recommended just compensation in the amount of $535,000. This amount will be the basis for the offer for property acquisition to Dr. Wendland for the real estate. Upon MAC's review of Mr. Pelton's report, a figure will be provided to the Council for consideration for just compensation for the immovable fixtures and equipment. In addition to the above, the property owner and 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 a draft resolution for review. The final, revised resolution will be presented to the City Council for action at the May 30 meeting. is 1 111. BASIS OF RECOMMENDATION A. POLICY • The subject property has been identified for purchase for the project. The Memorandum of Understanding between the City, the Minnesota Department of Transportation (the WNDOT"), and MAC outlines the responsibilities for each participating agency. • The Agreement between the City and MAC further outlines the responsibilities of each agency as to property acquisition and construction. Right of Way acquisition procedures set forth by MNDOT are being followed. B. CRITICAL ISSUES • At this time, it is critical that Dr. Wendland receive an offer by May 31, 2000 due to contingencies in her purchase agreement on the replacement property. • Acquisition of the subject property by eminent domain (quick take condemnation) is also being pursued to determine the final value. The owner's opinion of value is much higher than the offer. However, the filing of the condemnation action will be delayed to permit time for full negotiations. Dr. Wendland and her legal counsel have concurred to this dual track of property acquisition. C. FINANCIAL • MAC is obligated to fund this transaction. D. LEGAL • The City's legal counsel, Robert Lindall, has been working with staff and consultants to expedite an offer to Dr. Wendland by May 31, 2000. E. TIMING • If the offer, which is based on just compensation, is accepted, the City could potentially have title to the subject property by the end of June, 2000. Dr. Wendland has requested that the City not take possession of the property until her replacement property is ready for occupancy, some time in late summer, early fall. IV. ALTERNATIVE RECOMMENDATION(S) I • Delay approval of the just compensation. • Do not approve just compensation and property acquisition. V. ATTACHMENTS I • Resolution establishing just compensation and authorizing the purchase of 6521 Cedar Avenue. VI. PRINCIPAL PARTIES EXPECTED AT MEETING • N/A 0 REVISED RESOLUTION FOR STAFF REPORT NO. 137; NAY 30, 2000 RESOLUTION NO. RESOLUTION ESTABLISHING JUST COMPENSATION AND AUTHORIZING PURCHASE OF REAL PROPERTY 6521 CEDAR AVENUE WHEREAS, the City of Richfield, Minnesota desires to purchase certain real property pursuant to and in furtherance of the 66th Street/T.H. 77 Interchange Project (Project) heretofore adopted by the City of Richfield (City) said real property being described as follows: Lot 6 and the South 30 feet of Lot 5, Block 1, New Ford Town Addition, Hennepin County, Minnesota Together with all abutting streets and alleys, vacated or to be vacated, and all easements, gaps, overlaps and gores, appurtenant thereto; and WHEREAS, the City has adopted a layout for Project improvements; and WHEREAS, the Project improvements necessitate the purchase of real property; and WHEREAS, the City is authorized by Minnesota Statutes to acquire real property within its corporate boundaries; and WHEREAS, the Metropolitan Airports Commission (MAC) is initially funding the Project; and WHEREAS, the City has caused appraisals for the subject property to be made by qualified independent professional appraisers to determine fair market value of real estate and immovable fixtures and equipment appurtenant thereto; and WHEREAS, a qualified review appraiser has certified the appraisal reports as being in conformity with appraisal standards; and WHEREAS, a qualified fixture review appraiser has certified the fixture appraisal report as being in conformity with appraisal standards; and WHEREAS, MAC has reviewed all appraisal reports and review appraisal reports prepared for the subject property and has recommended that the just compensation for the real estate be determined by the City Council to be $535,000, and that the just compensation for the immovable fixtures and equipment appurtenant thereto be determined by the City Council to be $24,750. WHEREAS, MAC has also recommended that the City proceed to make an offer to the owner of the subject property in the above stated just compensation amounts. WHEREAS, the above stated just compensation amounts are consistent with said appraisal reports and review appraisal reports. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield, Minnesota as follows: 1. That the total just compensation for the above described real estate and immovable fixtures and equipment is determined to be $559,750. 2. That the City's agent, Conworth, Inc. is authorized and directed to submit to the property owner the City's offer to pay such just compensation amount for all interest in the subject property and commence negotiations for the purchase of said property. 3. That the City's agent, Conworth, Inc. is hereby directed to notify, in writing, the owners of the subject property that the City intends to acquire this property and establish eligibility for relocation benefits. 4. That the City Manager and Mayor are authorized to execute purchase agreements in form acceptable to them and take all other actions necessary to complete the purchase of the property for the amount of just compensation set forth in this resolution. Adopted by the City Council of the City of Richfield, Minnesota this 30th day of May, 2000. Martin J. Kirsch, Mayor ATTEST: Thomas P. Ferber, City Clerk 0 DRAFT FOR REVIEW ONLY RESOLUTION NO. RESOLUTION ESTABLISHING JUST COMPENSATION AND AUTHORIZING PURCHASE OF REAL PROPERTY 6521 CEDAR AVENUE WHEREAS, the City of Richfield, Minnesota desires to purchase certain real property pursuant to and in furtherance of the 66th Street/T.H. 77 Interchange Project (Project) heretofore adopted by the City of Richfield (City) said real property being described as follows: Lot 6 and the South 30 feet of Lot 5, Block 1, New Ford Town Addition, Hennepin County, Minnesota Together with all abutting streets and alleys, vacated or to be vacated, and all easements, gaps, overlaps and gores, appurtenant thereto; and WHEREAS, the City has adopted a layout for Project improvements; and WHEREAS, the Project improvements necessitate the purchase of real property; and WHEREAS, the City is authorized by Minnesota Statutes to acquire real property 1 within its corporate boundaries; and WHEREAS, the Metropolitan Airports Commission (MAC) is initially funding the Project; and WHEREAS, the City has caused appraisals for the subject property to be made by qualified independent professional appraisers to determine fair market value of real estate and immovable fixtures and equipment appurtenant thereto; and WHEREAS, a qualified review appraiser has certified the appraisal reports as being in conformity with appraisal standards; and WHEREAS, a qualified fixture review appraiser has certified the fixture appraisal report as being in conformity with appraisal standards; and WHEREAS, MAC has reviewed all appraisal reports and review appraisal reports prepared for the subject property and has recommended that the just compensation for the real estate be determined by the City Council to be $535,000, and that the just compensation for the immovable fixtures and equipment appurtenant thereto be determined by the City Council to be $ WHEREAS, MAC has also recommended that the City proceed to make an offer to the owner of the subject property in the above stated just compensation amounts. DRAFT FOR REVIEW ONLY WHEREAS, the above stated just compensation amounts are consistent with said appraisal reports and review appraisal reports. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Richfield, Minnesota as follows: 1. That the total just compensation for the above described real estate and immovable fixtures and equipment is determined to be $ 2. That the City's agent, Conworth, Inc. is authorized and directed to submit to the property owner the City's offer to pay'such just` compensation amount for all interest in the subject property and commence negotiations for the purchase of said property. 3. That the City's agent, Conworth, Inc. is hereby directed to notify, in writing, the owners of the subject property that the City intends to acquire this property and establish eligibility for relocation benefits. 4. That the City Manager and Mayor are authorized to execute purchase agreements in form acceptable to them and take all other actions necessary to complete the purchase of the property for the amount of just compensation set forth in this resolution. Adopted by the City Council of the City of Richfield, Minnesota this day of 2000. Martin J. Kirsch, Mayor ATTEST: Thomas P. Ferber, City Clerk 0