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12-21-98 agendaCITY OF RICHFIELD MONDAY, DECEMBER 21, 1998 REGULAR HOUSING AND REDEVELOPMENT AUTHORITY MEETING RICHFIELD CITY HALL COUNCIL CHAMBERS 7 P.M. AGENDA CALL TO ORDER APPROVAL OF MINUTES OF (1) SPECIAL HRA/CITY COUNCIL MEETING OF NOVEMBER 16, 1998 AND (2) REGULAR HRA MEETING OF NOVEMBER 16, 1998 OPPORTUNITY FOR CITIZENS TO ADDRESS THE HRA ON ITEMS NOT ON THE AGENDA 2. CONSIDERATION OF RESOLUTIONS DESIGNATING OFFICIAL DEPOSITORIES FOR HRA OF RICHFIELD FOR 1999, INCLUDING COLLATERAL HRA LETTER NO. 80 3. CONSIDERATION OF REQUEST BY CSM PROPERTIES, INC., FOR 60 DAY EXTENSION TO SUBMIT PRECONDITIONS OUTLINED IN INTERCHANGE WEST REDEVELOPMENT CONTRACT HRA LETTER NO. 81 4. CONSIDERATION OF RESOLUTION APPROVING FIRST AMENDMENT TO CONTRACT FOR PRIVATE REDEVELOPMENT WITH GRAMERCY PARK COOPERATIVE AT LAKE SHORE DRIVE; GRAMERCY TIF DISTRICT HRA LETTER NO. 82 5. CONSIDERATION OF RESOLUTION DECLARING OFFICIAL INTENT OF HRA TO ISSUE "PAY AS YOU GO" TAX INCREMENT NOTE FOR URBAN VILLAGE AS TAX EXEMPT DEBT HRA LETTER NO. 83 6. EXECUTIVE DIRECTOR REPORT 7. CLAIMS AND PAYROLL ADJOURNMENT AUXILIARY AIDS FOR INDIVIDUALS WITH DISABILITIES ARE AVAILABLE UPON REQUEST. REQUESTS MUST BE MADE AT LEAST 96 HOURS IN ADVANCE TO THE ADMINISTRATIVE SERVICES DIRECTOR AT 861-9702. HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 83 Agenda December 21, 1998 Issue Statement: Consideration of a request from Richfield State Agency (RSA) to issue the "pay as you go" tax increment note for the Urban Village as tax exempt debt. Background: RSA's Urban Village project lender has requested that the debt to be incurred for the Urban Village be given tax exempt status (interest payments received by the lender would be exempt from federal and state income taxes). A preliminary review of expenses incurred to date as well as those anticipated through project completion in 2000 indicates that most would be eligible for a tax exempt status. One of the IRS eligibility rules limits eligible expenses to a period beginning 60 days prior to the adoption of a resolution by the HRA declaring its intent to issue tax exempt debt. During November and December, RSA has expended or obligated in excess of $1 million primarily for acquisition and relocation expenses. Ehlers & Associates will complete their financial analysis of the project in January. To date, it appears that the amount of expenses which would be eligible for possible tax exempt status would be in the $8 million to $10 million range. When the analysis is completed, it will be presented to the HRA so that the amount of the tax increment "pay as you go" note can be set. The City of Richfield and related entities are restricted to issuing $10 million annually in tax exempt debt. At this time, it appears that in the year 2000, there would be no competing projects for tax exempt debt. Recommended Motion: Adopt the attached resolution which declares the intent of the HRA to issue tax exempt debt in an amount not to exceed $10 million. Basis of Recommendation: 1. The developer has requested that the HRA "pay as you go" tax increment note be issued as tax exempt debt. 2. The tax exempt note reduces the overall costs of the project. 3. Legal counsel and financial consultant have opined that the note could be given tax exempt status. 4. When issued in the year 2000, the "pay as you go" tax increment note would be secured with tax increment generated from the development. It would not be a general obligation of the City or HRA. 5. Adopting the attached resolution does not obligate the issuance of debt. The exact amount of debt to be issued will be considered at the January 19 HRA meeting. 6. Not adopting the resolution at this time would prevent reimbursement for some eligible tax exempt expenses already incurred by the developer. 7. IRS rules allow up to $10 million in tax exempt debt to be annually issued by cities including entities such as the HRA. The resolution's purpose is to give notice of upcoming tax exempt debt and to qualify as many expenses as possible for reimbursement. Alternative Recommendation: 1. Delay action. However, RSA is presently incurring eligible expenses. 2. Modify the maximum amount which could be declared. Discussion/Decision Mode: Sid Inman of Ehlers & Associates will be present at the December HRA meeting to respond to questions. The HRA will set the amount of the tax increment note in January. Respecl. Ily submitted, Jam s D. Prosser Executive Director JDP:cak is HRA RESOLUTION NO. RESOLUTION DECLARING THE OFFICIAL INTENT OF THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD TO REIMBURSE CERTAIN EXPENDITURES FROM THE PROCEEDS OF BONDS TO BE ISSUED BY THE AUTHORITY WHEREAS, the Internal Revenue Service has issued Treas. § Reg. 1.150 providing that proceeds of tax-exempt bonds used to reimburse prior expenditures will not be deemed spent unless certain requirements are met; and WHEREAS, the Housing and Redevelopment Authority expects to incur certain expenditures which may be financed temporarily from sources other than bonds, and reimbursed from the proceeds of a bond. NOW THEREFORE BE it resolved by the Housing and Redevelopment Authority in and for the City of Richfield (the "Authority") as follows: 1. The Authority reasonably intends that expenditures will be made for the project described in Exhibit A (the "Project"), and reasonably intends to reimburse such expenditures from the proceeds of debt to be issued by the Authority in the maximum principal amount described in Exhibit A. 2. The Executive Director is authorized to designate appropriate additions to Exhibit A in circumstances where time is of the essence, and any such designation shall be reported to the Board at the earliest practicable date and shall be filed with the official books and records of the Authority as provided in Section 3. 3. This resolution is intended to constitute a declaration of official intent for purposes of Treas. Reg. § 1.150-2 and any successor law, regulation, or ruling. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 21st day of December, 1998. Thomas Harms, Chair ATTEST: Michael Sandahl, Secretary r`?1 U EXHIBIT A TO OFFICIAL INTENT RESOLUTION ADOPTED Maximum Principal Date of Amount of Debt Declaration Description of Project for Project Urban Village Improvements $10,000,000 0 HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 82 Agenda December 21, 1998 Issue Statement: First Amendment to Contract for Private Redevelopment by and between the Housing and Redevelopment Authority (HRA) in and for the City of Richfield and Gramercy Park Cooperative at Lake Shore Drive, a Minnesota cooperative corporation; Gramercy TIF District. Background: In July 1998, the HRA approved the above identified contract. Subsequently, the project was submitted to the Department of Housing and Urban Development/Federal Housing Administration (HUD/FHA) for review and mortgage approval. During the review process, Gramercy, Inc. learned that the project exceeded FHA mortgage limits. In response, Gramercy has downsized the proposed development from 218 units to 160 units. The assessor has also revised his estimate of the value of the project from $22,000,000 to $18,000,000. Exhibit A to the contract was a limited revenue tax increment note in the principal amount of $3 million with an attached Payment Schedule A. Recommended Motion: Adopt a motion approving the attached resolution which approves the First Amendment to the Contract for Private Redevelopment with Gramercy Park Cooperative at Lake Shore Drive by amending the limited revenue tax increment note to $2,230,174. Basis of Recommendation: 1. The downsizing of the project and resulting decrease in value make it appropriate to amend the TIF note. 2. If the First Amendment is not approved, the original limited revenue tax increment note will remain valid. 3. No other aspects of the note would be modified. 4. The exterior appearance of the structure will remain basically the same with the two exceptions noted as follows. First, the loss of units means the building will be 12 stories in height rather than 14. Second, the VFW facility will remain approximately the same size (8,000 sq. ft.), but it will become a one story structure rather than two stories as originally proposed. 5. The original project had an estimated market value (EMV) to TIF ratio of 14%. The revised project has a ratio of 12%. 6. The original project had a TIF assistance of $13,761/unit. The revised project has a rate of $13,938/unit. Alternative Recommendation: 1. Refuse to modify the note. 2. Delay action on the note. Discussion/Decision Mode: On December 14, the City Co development plan, conditiona approval by the HRA of an am this amendment at the Decem the HRA and City. Respectful1v submitted, Jam s Prosser Exec ve Director uncil approved modifications to the planned unit I use permit and final development plan subject to the ended note. It would be desirable for the HRA to act on ber 21 meeting so the developer knows their status with JDP:ds ?.I • HRA RESOLUTION NO. 0 RESOLUTION APPROVING FIRST AMENDMENT TO CONTRACT FOR PRIVATE REDEVELOPMENT WITH GRAMERCY PARK COOPERATIVE WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota (the "Authority") has properly created and is administering its Redevelopment District (the "District") pursuant to Minnesota Statutes Chapter 469 in an effort to encourage the development and redevelopment of certain designated areas within the City of Richfield; and WHEREAS, among the development activities proposed to be assisted by the Authority in the District are the development of housing facilities; and WHEREAS, the Authority did on July 20, 1998, approve a form of Contract for Private Redevelopment ("Contract") between the Authority and Gramercy Park Cooperative at Lake Shore Drive, setting forth the parties respective responsibilities in developing the facility; and WHEREAS, a part of the Contract is labeled Exhibit A and Schedule A related to the Limited Revenue Tax Increment Note in the amount of $3,000,000; and WHEREAS, the development contemplated by the Contract has been downsized. NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota as follows: 1. That the First Amendment to the Contract for Private Redevelopment with Gramercy Park Cooperative at Lake Shore Drive is hereby approved. 2. That the proper Authority officers are hereby authorized to execute the amendment on behalf of the Authority and to carry out, on behalf of the Authority, the Authority's obligations thereunder. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 21st day of December, 1998. Thomas E. Harms, Chair to ATTEST: Michael Sandahl, Secretary FIRST AMENDMENT TO CONTRACT FOR PRIVATE REDEVELOPMENT THIS AMENDMENT, made and entered into as of the day of , 19_ by and between GRAMERCY PARK COOPERATIVE AT LAKE SHORE DRIVE, a Minnesota Cooperative Corporation ("Redeveloper") and THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, a Minnesota public body corporate and politic ("HRA"). WITNESSETH: WHEREAS, the HRA and Redeveloper did on July 20, 1998 execute and deliver that certain document entitled Contract for Private Redevelopment ("Contract"); and WHEREAS, restrictions subsequently placed upon the scale of the development by third parties have necessitated that the Contract be amended as set forth below; and WHEREAS, the HRA has reviewed the proposed amendments, has received the reports and recommendations of its staff and consultants, and has concluded that the proposed amendments are necessary and appropriate and in furtherance of the proposed redevelopment. NOW THEREFORE, based upon the mutual covenants and undertakings of the parties, the Contract is hereby amended by amending Exhibit A. thereof to read as follows: $2,230,174 UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD LIMITED REVENUE TAX INCREMENT NOTE The Housing and Redevelopment Authority in and for the City of Richfield (the "Authority"), hereby acknowledges itself to be indebted and, for value received, promises to pay to the order of Gramercy Park Cooperative at Lake Shore Drive (the "Owner"), to the extent and in the manner hereinafter provided, the original principal amount of this Note, being $2,230,174 (the 'Principal Amount"), together with interest thereon accrued from the date of this Note, at the rate of interest of 7.5% per annum (the "Stated Rate"), in the amount and on the dates (the "Scheduled Payment Dates") set forth on the Payment Schedule attached as Schedule A hereto and in the amounts stated thereon (the "Scheduled Payments"). Unpaid interest accruing from the date of this Note, shall be added to principal on a semi-annual basis on each August 1 and February 1 beginning with February 1, 1999 until February 1, 2001. 40 Any payments on this Note shall be applied first to accrued interest and then to the Principal Amount in respect of which such payment is made. JBD-154841 1 RC125-170 i Each payment on this Note is payable in any coin or currency of the United States of America which on the date of such payment is legal tender for public and private debts and shall be made by check or draft made payable to the Owner and mailed to the Owner at it postal address within the United States which shall be designated from time to time by the Owner. The Note is a special and limited obligation and not a general obligation of the Authority, which has been issued by the Authority to aid in financing a "project," as defined in Minnesota Statutes, § 469.174, of the Authority within and for the benefit of the Interchange Tax Increment Financing District ("District"). THE NOTE IS NOT A DEBT OF THE AUTHORITY, THE CITY OF RICHFIELD, OR THE STATE OF MINNESOTA (THE "STATE"), AND NEITHER THE AUTHORITY, THE CITY OF RICHFIELD, THE STATE NOR ANY POLITICAL SUBDIVISION THEREOF SHALL BE LIABLE ON THE NOTE, NOR SHALL THE NOTE BE PAYABLE OUT OF ANY FUNDS OR PROPERTIES OTHER THAN AVAILABLE TAX INCREMENT, AS DEFINED BELOW. The Scheduled Payment of this Note due on any Scheduled Payment Date is payable solely from and only to the extent that the Authority shall have received as of such Scheduled Payment Date "Available Tax Increment." For the purpose of this Note, "Available Tax Increment" means: Seventy-five Percent (75%) of the tax increment received from the real estate described in Schedule B the "Redevelopment Property" for years beginning with 1998 and ending in 2026, after first deducting therefrom i) any amount needed to make a previously due but unpaid Scheduled Payment to Owner; and ii) any amount required to make a payment due but not otherwise paid to the Authority under the Development Contract. For purposes of this Note, a "Payment Date" shall mean each of the Scheduled Payment Dates set forth on Schedule A attached hereto. To the extent that on any Payment Date the Authority is unable to make a full Scheduled Payment due to insufficient Available Tax Increment (which insufficiency is not due to a failure of the Owner to pay full real estate taxes payable on the Redevelopment Property), such deficiency shall be deferred and paid along with future Scheduled Payments but only to the extent of Available Tax Increment. This Note shall terminate upon the earlier of i) the date when the Redeveloper has been fully reimbursed according to the terms hereof, or ii) February 1, 2026. This Note shall also terminate and the Authority's obligation to make any payments under this Note shall be discharged and the Authority shall have no obligation and incur no liability to make any payments hereunder immediately upon the occurrence of an Event of Default under the Contract for Private Development, dated July 20, 1998, (the "Development Contract") between the Authority and the Owner, subject to the notice and cure provisions of Section 9.2 thereof. This Note shall not be payable from or constitute a charge upon any funds of the Authority or the City of Richfield and the Authority shall not be subject to any liability hereon or be deemed to have obligated itself to pay hereon from any funds except the Available Tax Increments, and then only to the extent and in the manner herein specified. JBD-154841 2 RC125-170 The Owner shall never have or be deemed to have the right to compel any exercise of any taxing power of the Authority or the City of Richfield or of any other public body, and neither the Authority or the City of Richfield nor any director, commissioner, council member, board member, officer, employee or agent of the Authority or the City of Richfield, nor any person executing or registering this Note shall be liable personally hereon by reason of the issuance or registration hereof or otherwise. This Note shall not be transferable or assignable, in whole or in part, by the Owner without the prior written consent of the Authority; provided that the Owner may pledge the payments hereunder to a lender or assign the payments hereunder to a subsequent purchaser of the Development, but only with prior written notice thereof to the Authority. The Owner may also, without prior notice to or consent of the Authority transfer or assign the Note or the right to receive payments under the Note to a wholly-owned subsidiary of the Owner. This Note may be prepaid in full at any time at the option of the Authority; and may also be prepaid at the request of the Owner, but in either instance only if the Authority first determines that sufficient tax increment is or willbe generated to permit such prepayment, and the parties agree upon the actual prepayment amount. This Note is issued pursuant proper action of the Authority by Resolution and the Owner is entitled to the benefits thereof, which Resolution is incorporated herein by reference. IT IS HEREBY CERTIFIED AND RECITED that any acts; conditions, and things required by the Constitution and laws of the State of Minnesota to be done, to have happened, and to be performed precedent to and in the issuance of this Note have been done, have happened, and have been performed in regular and due form, time, and manner as required by law; and that this Note, together with all other indebtedness of the Authority or the City of Richfield outstanding on the date hereof and on the date of its actual issuance and delivery, does not cause the indebtedness of the Authority or the City of Richfield to exceed any constitutional or statutory limitation thereon. IN WITNESS WHEREOF, the Board of Commissioners of the Authority has caused this Note to be executed by the manual signatures of the Chairperson and the Executive Director of the Authority and has caused this Note to be dated '199 Chairperson • Executive Director JBD-154841 3 RC125-170 • • SCHEDULE A SCHEDULED PAYMENT DATES SCHEDULED PAYMENTS SCHEDULED PAYMENT DATES SCHEDULED PAYMENTS 8/1/01 105,864 2/1/14 125,754 2/1/02 105,864 8/1/14 127,560 8/1/02 107,402 2/1/15 127,560 2/1/03 107,402 8/1/15 129,391 8/1/03 108,961 2/1/16 129,391 2/1/04 108,961 8/1/16 131,247 8/1/04 110,540 2/1/17 131,247 2/1/05 110,540 8/1/17 133,128 8/1%05 112,141 2/1/18 133,128 2/1/06 112,141 8/1/18 135,034 8/1/06 113,764 2/1/19 135,034 2/1/07 .113,764 8/1/19 136,965 8/1/07 -115,409 2/1/20 136,965 2/1/08 115,409 8/1/20 138,923 8/1/08 117,076 2/1/21 138,923 2/1/09 117,076 8/1/21 140,908 8/1/09 118,765 2/1/22 140,908 2/1/10 118,765 8/1/22 142,919 8/1/10 120,477 2/1/23 142,919 2/1/11 120,477 8/1/23 144,957 8/1/11 122,213 2/1/24 144,957 2/1/12 122,213 8/1/24 147,023 8/1/12 123,971 2/1/25 147,023 2/1/13 123,971 8/1/25 149,116 8/1/13 125,754 2/1/26 90,081 JBD-154841 RC125-170 In all other respects the Contract remains in full force and effect according to its terms IN WITNESS WHEREOF, the parties hereto have set their hands and seals as of the day and year first above written. THE HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF RICHFIELD, MINNESOTA By: _ Its: By: _ Its: GRAMERCY PARK COOPERATIVE AT LAKE SHORE DRIVE • By: _ Its: STATE OF MINNESOTA ) ) SS COUNTY OF ) The foregoing instrument was acknowledged before me this day of 1998, by and , the Chairperson and Executive Director of The Housing and Redevelopment Authority in and for the City of Richfield, Minnesota. Notary Public E JBD-154841 RC125-170 STATE OF MINNESOTA ) )SS. COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this day of , 199, by the of a cooperative corporation under the laws of Minnesota, by and on behalf of said corporation. Notary Public • JBD-154841 RC125-170 • HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 81 Agenda December 21, 1998 Issue Statement: Request by CSM Properties, Inc. for a 60 day extension to submit the preconditions outlined in the Interchange West redevelopment contract. Background: The HRA entered into a Contract for Private Development with CSM Properties, Inc. on October 19, 1998 for the development of the Interchange West area. This agreement contained provisions for the completion of a concept plan within 45 days and specified 12 other preconditions to be accomplished within 60 days of the acceptance of the contract (Attachment A). CSM is in the process of negotiating the acquisition of most of the properties in the area. The large commercial property owners have begun looking for replacement properties and CSM's acquisition consultant Ken Brooks, has begun negotiations with more than 45 of the 67 homeowners. The concept plan was presented to City staff at the Design Review Advisory Committee (DRAC) on December 9. Based on the comments from DRAC, CSM will be making some revisions to their concept plan. For the purpose of making these revisions and determining more precise acquisition figures, CSM is requesting an extension until the February 16 HRA meeting for the completion . of the preconditions stipulated in the redevelopment contract. The attached letter from Murray Kornberg at CSM serves as an update of their current progress as well as their request for an extension for their completion of the preconditions. The redevelopment contract also stipulates 12 provisions to be submitted or completed by CSM within 120 days its execution. The requested extension would not affect this 120 day period and would not, therefor, delay the overall project. Recommended Motion: Accept CSM's request for an extension until the February 16 HRA meeting for the submittal of the preconditions outlined in the Interchange West redevelopment contract. Basis of Recommendation: 1. On October 19, 1998, the HRA entered into a Contract for Private Development with CSM Properties, Inc. for the redevelopment of the Interchange West area. 2. The contract contained several preconditions to be submitted by CSM within 60 days of its acceptance. 3. CSM is making a diligent effort to negotiate the terms for acquiring properties in the area. 0 4. This extension would not delay the redevelopment of the site. • Alternative Recommendation: 1. Reject the request for an extension and terminate the redevelopment contract. 2. Provide an extension of a lesser period of time for CSM's submittal of the preconditions. Discussion/Decision Mode: Mr. Kornberg will be at the meeting on December 21 to present his report. Respectfully submitted, Jam D. Prosser Executive Director JDP:ds 0 Attachment A • ARTICLE 11.5 PRECONDITIONS Section 2.5.1. Initial Preconditions to Acquisition. Not later than 60 days from the date of this Agreement, (45 days for the Concept Plans), unless such date is extended by the mutual written consent of the parties, the parties shall have reached written agreement on the following matters: (a) the Concept Plans, which will include agreement relative to the proposed subdivision of the Redevelopment Property and creation of the Elements of the Development; (b) the location and nature of all public improvements to be constructed to serve and benefit the Development, together with the timing and responsibility for their construction and the phase out of existing public improvements; (c) the location, layout and design of any interior traffic circulation systems, including their interface with adjacent roadways, and the timing for construction of the same; (d) the landscape plan and the timing for installation of the same; . (e) tree protection during construction (redeveloper to be responsible for the cost of a survey and protection plan.) (f) a schedule for commencement and completion of construction of each Element of the Development, and all public improvements to serve the Development; (g) the condition of the Redevelopment Property with respect to environmental contaminations and pollution; and the obligations and responsibilities of the parties with respect to remediation, if any; (h) the nature, location and cost of removal or relocation any utilities currently located on the Redevelopment Property which are required to be removed or relocated due to construction of the minimum improvements and the allocation and financing of the cost of such activities; and (i) the conditions for the release of Redeveloper following the assignment of an Element described in Section 9.4(b). 0) to the extent required by law, the number of new jobs and the average wages for the new jobs created by the Development. (k) the form of the Tax Increment Plan, which plan, following agreement as to form, shall have been considered and adopted by the City. JBD-151523 RC125-152 6 (1) the program of mediation of matters described in Section 3.2(b) • (m) the level of public assistance which is necessary in order to facilitate the development contemplated in the Concept Plan (The "But For" Analysis) In the event that the parties are unable to reach agreement on all the matters and in the time described above or in the event that the Tax Increment Plan has not been adopted, either party may terminate this Agreement by written notice to the other party whereupon this Agreement shall, notwithstanding anything in Article X hereof to the contrary, be null and void, and the parties shall be relieved of any further obligations hereunder. • 1? JBD-151523 RC125-152 7 -?. Celeb,u ag 20 Ye?.s,; of Serving Y.. CSM Corporation 2575 University Avenua West, Suite "oil December 16, 1998 Mr. John Stark City of Richfield 6700 Portland Avenue South Richfield, Minnesota 55423 Re: Interchange West Dear John: By Facsimile Following is an update of our activities on the Project since the HRA Meeting at which the Contract for Redevelopment was approved: 1. Residential A%Wjjs tion As you know, we have retained the services of Ken Brooks of The C. Chase Company to assist us in the acquisition of the residential property. To date Mr. Brooks has and with ovcr forty homeowners for the purposes of (i) completing an inspection of each property, (ii) deterrni with the owner the Fair Market Value of each property, (iii) updating the property. owners on the status of the Projcct, and (iv) addressing specific individual concerns about the Project. As a result of these meetings, Mr. Brooks has also obtained from each property owner a price for which they would be prepared to sell their property. It is our goal to have Mr. Brooks complete his meetings with the balance of the property owners by the end of the year. Upon the completion of these meetings (at which point the owners selling price for all of the residential property will be known and can be evaluated) we will prepare and submit to each owner a Purchase and Sale Agreement for review and negotiation. Notwithstanding the upcoming holiday season, we are hopeful that Mr. Brooks eau complete his meetings with all residential property owners by the end of the year. 2. Commercial Property Acquisition Negotiations continue with the two largest commercial property owners (the automobile dealers) located along Interstate 494. We continue to make sigmficaat progress in addressing the complicated issues involving the acquisition of these properties, including price, the costs and timing of relocation, and mattm relating to the physical condition of the property. While no definitive agreements 1"ve yet been reached we are --nfident that the progress tirade to date will lead to the successful conclusion of these negotiations. We have also met with several of the other commercial property owners and tenants in the Project area, and are in the process of completing negotiations with those owners for the acquisition of their property. We have also asked the City, and the City has agreed to, retain the services of Conworth, Inc. to provide relocation assistance to residential and commercial property owners and tenants. 150 • St. Paul, MN 55114.1024 (651) 646.1717 • FAX (651) 646-2404 of 51CSM1V0(,1WOMEIMISCDATAICAROI,Mwgt=fflmk1194 W&kl.doc • 3. COnceDt Plan Development. We continue to refine our planning for the Project, and have reviewed a preliminary Concept Plan with membm of City staff to receive input on the critical land use issues which impact the Project, including traffic, and utility and roadway infastructure requirements. These comments are being incorporated into our design for the completion of the Project's Concept Plan. As you know, the Contract for Redevelopment lists several preconditions for approval of the Project, (including but not limited to the completion of a Concept Plan and other plans associated therewith, and the completion of a T1F Plan and "But For" Analysis for the Project) which were to have been completed within sixty days of the Contract execution date. While we have made significant progress to date, significant work remains to properly address the preconditions of the Contract. We hereby request an extension until the HRA Meeting of February 16, 1999 to allow us sufficient additional timc to address the initial preconditions. While this request does involve an extension of the time within which we are to satisfy preconditions, the date by which the Contract's final conditions are to be met has not changed. At this point we are confident that those conditions can be addressed within the time frame contemplated by the Contract. If our extension request is approved by the HRA, the interim and final conditions will be simultaneously addressed at the February meeting, and by that time we will have a more thorough and complete development program for the BRA to consider. Moreover, we will also have had sufficient additional time within which to continue our negotiations with property owners so that a more accurate and complete financial analysis of the Project can be completed by staff and reviewed by the BRA. We look forward to updating the HRA on the status of the Project at Monday's meeting, and to the BRA,$ favorable response to our request. Should you have any questions regarding the Project, please do not hesitate to contact me. Sincerely yours, Murray Kornberg Acquisitions & Financing MK/cm cc: Bill Franke Gary Tushie Bruce Palmborg 0 0-1HO..%AEX.GSCDATA?CAROLMwarft \wkU99VSwkl.doe HOUSING AND REDEVELOPMENT AUTHORITY HRA No. 80 . Agenda December 21, 1998 Issue Statement: Resolutions designating official depositories for the HRA of Richfield for 1999, including the approval of collateral. Background: In accordance with Minnesota Statutes Section 475.66 and 118.005, the HRA of Richfield must annually establish financial institutions, which have pledged the necessary collateral over and above the amount of federal insurance, as public depositories. The Firstar Bank is pledging collateral in the amount of $1,625,000. This collateral pledge means that the HRA's deposits up to this amount are secured with the depository. In addition to this collateral pledge, HRA funds are protected by the Federal Deposit Insurance Corporation in the amount of $100,000, making the total protection afforded by this depository for HRA funds equal to $1,725,000. A resolution naming the Firstar Bank as the 1999 official depository for the Richfield Housing and Redevelopment Authority is attached to this letter. In 1996, Firstar Bank has a community reinvestment rating of "satisfactory." Within Richfield, Firstar Bank has supported remodeling programs and made various cash donations in support of City and HRA programs. • A resolution must be provided annually, designating certain savings and loan as depositories for the investment of HRA Funds for 1999. These institutions, such as investment brokerage firms offer government securities in the manner required by law. These financial institutions include Richfield Bank and Trust Co., Piper Jaffray, Inc., Dain Rauscher, Norwest Investment Services, Morgan Stanley Dean Witter, Juran & Moody, Inc. and Miller Schhroeder Financial, Inc. With approval of these official depositories, the HRA will be able to invest funds in these institutions, not exceeding the federal insurance of $100,000. All designated depositories have received a community reinvestment rating of "satisfactory" or better in associations Finally, a and resolution is banks also as official attached which depositories designates for nates certain investment financial of nancial certain HRA institutions funds. 1996. Recommended Motion: It is recommended that the HRA adopt the attached resolutions designating official depositories, with the understanding that the HRA could not invest in any of the depositories beyond the level of insurance coverage of the pledged collateral. Basis for Recommendation: 1. It is recommended that the HRA adopt the attached resolutions designating official depositories, with the understanding that the HRA could not invest in any of the depositories beyond the level of insurance coverage of the pledged collateral. 2. The HRA has worked with the institutions recommended in the past and has found to have a good working relationship with these institutions. . Alternative Recommendation: The HRA could solicit other financial institutions for official depositories, but past relationships with the depositories recommended have proven satisfactory for the HRA. Discussions/Decision Mode: Action of the HRA is desirable at December 21, 1998, HRA meeting so that the HRA may invest funds in the approved financial institutions for the year 1999 immediately. Respectfully submitted, Jame fProsser Executive Director JDP:ds • • HRA RESOLUTION NO. • RESOLUTION DESIGNATING THE FIRSTAR BANK A DEPOSITORY OF FUNDS OF THE HOUSING AND REDEVELOPMENT AUTHORITY FOR RICHFIELD FOR THE YEAR 1999 AND APPROVING COLLATERAL BE IT RESOLVED, by the Housing and Redevelopment Authority of Richfield as follows: That, in accordance with Minnesota Statutes, Section 475.66 and 118.005, the Firstar Bank-Richfield be, and hereby is designated a depository of the funds of the Housing and Redevelopment Authority, and subject to the following terms and conditions: The said depository shall not be required to give bonds or other securities for such deposits provided that the total sum thereof shall not at any time exceed in any depository the sums for which its deposits are insured under the Acts of Congress of the United States relating to insurance of bank deposits; but not in case such deposits in any such depository shall at any time exceed such insured sum, said depository shall immediately furnish bonds or other security for such excess according to law, approved by the Housing and Redevelopment of Richfield. That said depository shall pay on demand all deposits therein; and shall pay all time deposits, at or after the end of the period for which the same shall be deposited, on demand. BE IT FURTHER RESOLVED, that there shall be maintained a general account in which shall be deposited all monies. The following officers or their facsimile signatures shall sign checks on this account: THOMAS E. HARMS, CHAIRMAN JAMES D. PROSSER, EXECUTIVE DIRECTOR BE IT FURTHER RESOLVED, that there shall be a daily interest savings account. All withdrawals from said account will be for transfers to the general checking account. BE IT FURTHER RESOLVED, that collateral in the amount of $1,625,000, deposited for safekeeping at the Firstar Bank - Milwaukee, Wisconsin is hereby approved. Passed by the Housing and Redevelopment Authority of Richfield, Minnesota this 21 st day of December, 1998. is ATTEST: Thomas E. Harms, Chairman Michael Sandahl, Secretary HRA RESOLUTION NO. RESOLUTION DESIGNATING CERTAIN FINANCIAL INSTITUTIONS AS DEPOSITORIES FOR THE INVESTMENT OF HOUSING AND REDEVELOPMENT AUTHORITY OF RICHFIELD FUNDS IN 1999 WHEREAS, the Housing and Redevelopment Authority of Richfield has money which is available for investment, and WHEREAS, different financial institutions offer different rates of return on investments, and WHEREAS, the Housing and Redevelopment Authority of Richfield shall purchase U. S. Treasury Bills, U. S. Treasury Notes and other such government securities in the manner required by law from the institution offering the highest rate to the Housing and Redevelopment Authority providing greater flexibility in the investment program and maximize interest income thereon. NOW, THEREFORE, BE IT RESOLVED, by the Housing and Redevelopment Authority of Richfield, Minnesota, as follows: 1. It is hereby found and determined that it is in the best interest of the proper management of Housing and Redevelopment Authority funds that certain financial institutions be designated as additional depositories for Housing and Redevelopment Authority funds for 1999. 2. The following financial institutions designated as depositories for Housing and Redevelopment Authority funds: Richfield Bank and Trust Company Dain Rauscher, Inc. Norwest Investment Services Morgan Stanley Dean Witter Piper, Jaffray & Hopwood Juran & Moody, Inc. Miller Schroeder Financial, Inc. 3. The Treasurer and Finance Manager are hereby authorized to deposit Housing and Redevelopment Authority funds in any or all of the depositories herein designated. Such deposits may be made and withdrawn from time to time by the Treasurer or Finance Managers best judgement and the interests of the Housing and Redevelopment Authority Dictates. 4. The investment of funds and the reporting thereof pursuant to this resolutions shall be conducted in accordance with established policies regarding the investment of these funds. Passed by the Housing and Redevelopment of Richfield, Minnesota this 21st day of December 1998. Thomas E. Harms, Chairman ATTEST: Michael Sandahl, Secretary r? 0 0 HRA RESOLUTION NO. RESOLUTION DESIGNATING CERTAIN SAVINGS AND LOAN ASSOCIATIONS AND BANKS AS DEPOSITORIES FOR THE INVESTMENT OF THE HOUSING AND REDEVELOPMENT AUTHORITY FUNDS IN 1999 WHEREAS, pursuant to Minnesota Statutes, Section 475.66 and 118.005; municipal funds may be deposited in any Savings and Loan Association which has its deposits insured by the Federal Savings and Loan Insurance Corporation, and WHEREAS, the amount of said deposits may not exceed the Federal Savings and Loan Insurance Corporation insurance covering such deposits which insurance amount is presently $100,000, and WHEREAS, the deposit of Housing and Redevelopment Authority funds in Savings and Loan Associations and Banks would provide greater flexibility in the Housing and Redevelopment Authority's investment program and maximize interest income thereon. NOW, THEREFORE, BE IT RESOLVED, by the Housing and Redevelopment Authority of Richfield, Minnesota as follows: 1. It is hereby found and determined that it is in the best interest of the proper is management of Housing and Redevelopment Authority funds that certain Savings and Loan Association and Banks be designated as additional depositories for Housing and Redevelopment Authority funds for 1998. 2. The following Savings and Loan Associations and Banks are hereby designated as additional depositories for Housing and Redevelopment Authority funds: Norwest Bank Minnesota, NA 6445 Nicollet Avenue South Richfield, Minnesota 55423 Richfield Bank & Trust Company 6625 Lyndale Avenue South Richfield, Minnesota 55423 3. It is further found and determined that the purpose of such depository designation is to facilitate the proper and advantageous investment of the Housing and Redevelopment Authority funds and that such designation is not exclusive nor does it preclude the deposit of any Housing and Redevelopment Authority funds in other officially designated depositories of Housing and Redevelopment Authority. 4. The Treasurer and Finance Manager are hereby authorized to deposit Housing and Redevelopment Authority funds in any or all of the depositories herein designated up to the amount of $100,000, or such other amount as may be subsequently permitted by law, such deposits to be in the form of demand accounts for Public Unit Savings Certificates purchased by the Housing and Redevelopment Authority of Richfield, payable to the Housing and Redevelopment Authority of Richfield on the signatures of the Treasurer or Finance Manager. Passed by the Housing and Redevelopment Authority of Richfield, Minnesota this 21 st day of December, 1998. Thomas E. Harms, Chairman ATTEST: Michael Sandahl, Secretary • 0