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06-17-96 agendaCITY OF RICHFIELD, MINNESOTA MONDAY, JUNE 17, 1996 REGULAR HOUSING AND REDEVELOPMENT AUTHORITY MEETING COUNCIL CHAMBERS 7:00 P.M. CALL TO ORDER APPROVAL OF MINUTES OF (1) SPECIAL JOINT CITY COUNCIL AND HRA MEETING WITH PLANNING COMMISSION OF MAY 20, 1996; (2) REGULAR HRA MEETING OF MAY 20, 1996; AND (3) SPECIAL HRA MEETING OF JUNE 3, 1996 OPPORTUNITY FOR CITIZENS TO ADDRESS THE HRA ON ITEMS NOTION THE AGENDA 2. PUBLIC HEARING AND CONSIDERATION OF RESOLUTION AUTHORIZING SALE OF RICHFIELD REDISCOVERED PROPERTY AT 7625 EMERSON AVENUE TO CHOICE WOOD, INC.; CONTINUATION OF PUBLIC HEARING TO SELL 7200 THIRD AVENUE; AND CANCELLATION OF PUBLIC HEARING REGARDING SALE OF 6621 GIRARD AVENUE HRA LETTER NO. 29 3. CONSIDERATION OF RESOLUTION AUTHORIZING EMINENT DOMAIN PROCEEDINGS TO ACQUIRE PROPERTY LOCATED AT 6205 MORGAN AVENUE FOR INCLUSION IN RICHFIELD REDISCOVERED PROGRAM HRA LETTER NO. 30 4. CONSIDERATION OF RESOLUTION AUTHORIZING PURCHASE OF 7027 COLUMBUS AND 6621 GIRARD AVENUES AND 2916 WEST 71 1/2 STREET UNDER RICHFIELD REDISCOVERED PROGRAM HRA LETTER NO. 31 5. CONSIDERATION OF RESOLUTION APPROVING MODIFICATIONS TO RICHFIELD HOME REHABILITATION DEFERRED LOAN PROGRAM • HRA LETTER NO. 32 • 6. CONSIDERATION OF REQUEST TO EXECUTE SUBORDINATION, NON- DISTURBANCEAND ATTORNMENTAGREEMENT FOR CSM, SHOPS AT LYNDALE, PHASE II HRA LETTER NO. 33 7. CONSIDERATION OF ACTION PLAN TO ACHIEVE HOUSING GOALS RELATED TO METROPOLITAN. LIVABLE COMMUNITIES ACT HRA LETTER NO. 34 8. CONSIDERATION OF RESOLUTION ESTABLISHING JUST COMPENSATION AND AUTHORIZING PURCHASE OF 6601 BLOOMINGTON AVENUE; CAR WASH SITE HRA LETTER NO. 35 9. DISCUSSION OF DEVELOPMENT INVESTMENT AND GROWTH OPPORTUNITIES IN RICHFIELD AND PROCESS TO IDENTIFY AREAS WITH. GREATEST POTENTIAL i HRA LETTER NO. 36 10. EXECUTIVE DLRECTOR REPORT 11. 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. 36 Agenda June 17, 1996 Issue Statement• Discuss development investment and growth opportunities in Richfield, and a process to identify areas with the greatest potential. Background• This agenda item provides the HRA the opportunity to begin to discuss a process which prioritizes development opportunities. Upon completion of the regular agenda items for the June 17, 1996 meeting, a Study Session format would be appropriate for this item. It is highly likely that the legislature will consider action to prohibit reprogramming of uncommitted tax increment resources next year. Such action would seriously inhibit the HRA in its efforts to continue commercial and residential redevelopment efforts funded from the Development Fund. This letter is intended to assist the HRA in evaluating options to commit future Development Fund monies. Attached are guidelines which the HRA .could use in evaluating opportunities. An "Opportunity Map" and "Opportunity Checklist" will be provided at the HRA meeting and maybe used as worksheets to assist the discussion. The map identifies 20 areas of the City. Over time these areas may provide the greatest investment opportunity-for housing and commercial redevelopment. The checklist identifies the project areas in greater detail, estimates the cost to provide cleared land for redevelopment, and provides a listing of characteristics to evaluate in prioritizing opportunities. The guidelines further explain the column headings on the checklist. The Commissioners may wish to modify the suggested guidelines during the discussions. John Dean, Kennedy & Graven, and Sid Inman, Publicorp, will be available at the meeting to participate in the discussion. Recommended Motion: Discuss and prioritize the development opportunities which have the greatest investment potential for making a positive impact on the community. Basis of Recommendation: 1. Prioritizing opportunities is important given the great need and limited resources. While there are few poor opportunities, some will emerge stronger than others. 2. The guideline, map, and checklist will help to rank the opportunities. • 3. .Legislators are again considering changes to the tax increment laws. Preventing plan modifications that allow the reprogramming of resources to meet changing needs are being discussed. Richfield could lose $6 million in present value resources or $12 million in future value resources by the year 2002. 4. Selecting priorities now and obligating the tax increment resources prior to legislative action would help preserve this revenue source. Alternative Recommendation: 1. The Commissioners may wish to add additional areas or delete some areas from consideration. 2. Reject consideration of investing. tax increment project funds in the community. 3. Defer discussion of this matter. Discussion/Decision Mode: The City Council could consider similar information at their July 1, 1996 Study Session. The funds need to be committed by year's end. Respectfully submitted, • James Prosser Executive Director JDP:ds • Attachment June 17, 1996 HRA Guideline for Evaluating Growth Opportunities The following criteria have been developed to assist in identifying the strongest opportunities with the potential for greatest benefit to the. community. 1. A need for intervention is evident; blighting conditions, conflicting land use and/or underutilized conditions exist. 2. The site has potential for providing alternative types of housing development. 3. The site has potential for retail/office development. 4. The potential net cost can be determined. 5. The proposed re-use has the potential to provide a cash flow and thereby a source of income and return on investment. i 6. The proposed re-use has the potential .for improving the property tax base as a return on investment. 7. The impact of the proposal on the School District can be determined. 8. The compatibility of the proposed use with present and proposed infrastructure improvements can be determined. 9. The proposed re-use is marketable. 10. Ease of site assembly; acquisition and relocation of existing uses, can be determined. • HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 35 Agenda June 17, 1996 Issue Statement: Consideration of a resolution establishing just compensation and authorizing the purchase of 6601 Bloomington Avenue car wash site. Background: In 1994, the HRA was presented with a proposal by a group of dentists and their development representative to redevelop the car wash site at 6601 Bloomington Avenue South into a dental office. Along. term lease between the property owner and the car wash owner/operator prevented successful redevelopment efforts. Earlier this year,. the property owner obtained a judgment against the tenant and car wash owner; the car wash owner has since abandoned the operation of the business. The property owner subsequently offered the property for sale. Recently, at the HRA's request, staff contacted the property owner and asked for an appraisal for the property. The appraised value was $138,500. The owner was asking $148, 500. • In the course of discussions between staff and the property owner, the property was offered for sale to the HRA for the appraisal price of $138,500. This most recent sequence of events places the HRA in the position of being able to acquire the site and, ultimately, direct the redevelopment of the property. If the HRA would decide to proceed in this fashion, the next step .would be to adopt a resolution setting just. compensation for the property and authorize the execution of a purchase agreement. The attached resolution for consideration sets just compensation for the property at $138,500. This reflects the value of the real estate, all remaining fixtures and equipment relating to the abandoned car wash, and the cost for incurring expenses for the removal of the abandoned car wash. A Phase I environmental assessment was completed in 1994 as part of the dental office proposal and no contamination was found. Also, all public processes related to the establishment of a redevelopment project area for this site were completed in 1994. If the HRA decides to proceed. with the acquisition of the property, it would be subject only to conveyance of clear title to the property. Recommended Motion: Adopt the resolution which sets just compensation; authorize purchase of this property at $138,500; and the Executive Director and Chairperson to execute a purchase agreement at this value and other documents necessary for purchase. Basis of Recommendation: 1. The HRA has previously expressed an interest in the property at 6601 Bloomington Avenue. 2. The property owner has offered to sell the property to the HRA for $138,500. 3. An appraisal of the property was completed and is consistent with the just compensation proposed. 4. Funds from the development account are available and proposed to be used to undertake the. purchase of the property and site clearance. 5. The HRA approved the Redevelopment Plan for the East 66th Street Project Area on November 21, 1994. 6. The Planning Commission approved the Redevelopment Plan for the East 66th Street Project Area on December 6, 1994. 7. The City Council approved the Redevelopment Plan for the East 66th Street Project Area on December 12, 1994. If the HRA acquires the property, staff would proceed with site clearance. Proposals for potential redevelopment of the property would then be sought. The HRA would be . presented with proposal concepts upon receipt from prospective developers. Alternative Recommendation: 1. The HRA could decide not to purchase the property and .allow the property to be purchased on the open market. 2. The HRA could decide to delay action on-this item. and consider this option at a future date. Discussion/Decision Mode: If the HRA is interested in pursuing this purchase, adoption of the resolution is necessary to obtain site control for removal of the blighted car wash and the potential redevelopment of this property along the East 66th Street corridor. Respectfully submitted, Ja es D. Prosser ecutive Director JDP:cak HRA RESOLUTION NO. RESOLUTION ESTABLISHING JUST COMPENSATION AUTHORIZING PURCHASE OF REAL PROPERTY 6601 BLOOMINGTON AVENUE WHEREAS, the Housing and Redevelopment Authority in and for the-City of Richfield (HRA) desires to purchase certain real property pursuant to and in furtherance of the East 66th Street Redevelopment Project Area Plan (Plan) adopted by the HRA. Said real property being described as follows: The North 250 feet of the West 1/4 of the Northwest 1/4 of the Northeast 1/4 of the Southeast 1/4 of Section 26, Township 28, Range 24, except streets, Hennepin County, Minnesota; and, WHEREAS, the implementation of the Plan necessitates the purchase of real property; and WHEREAS, the HRA is authorized by Minnesota Statutes to acquire real property for redevelopment project purposes; and WHEREAS, funding for the purchase of this property will be from the development fund; and • WHEREAS, the HRA has caused appraisals of the subject property to be made by qualified, independent, professional real estate appraisers to determine fair market value. NOW, THEREFORE, BE IT RESOLVED by the Housing And Redevelopment Authority in and for the City of Richfield, Minnesota as follows: 1. That just compensation is set at $138,500. 2. That the Executive Director and Chairperson are authorized to execute a chase agreement for the amount of the just compensation set forth in this resolution and other documents as necessary to effectuate a purchase. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 17th day of June, 1996. Thomas E. Harms, Chair ATTEST: ~1 l..J Vern Luettinger, Secretary HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. s4 Agenda June 17, 1996 Issue Statement: Consideration of an action plan to achieve housing goals related to the Metropolitan Livable Communities Act. Background• In December 1995 and January 1996, the HRA and City Council approved the attached housing goals and submitted them to the Metropolitan Council in compliance with the Livable Communities Act. The act requires a "housing action plan" by June 30, 1996 to demonstrate how Richfield will achieve the stated goals. Accomplishing these goals is consistent with the following objectives which are shared by the City Council .and HRA given best efforts, sufficient resources .and current programs: • More market rate new construction and remodeled homes. • Development of low density attached single family homes. • A greater variety of apartment choices: • Affordable housing opportunities such as Vo-Tech or Habitat for Humanity. The draft plan has been assembled in the form of a booklet (attached). The draft booklet has the following elements: • The Richfield Housing Goals; as previously approved. • The Program and .Marketplace Framework; the high and low density program responses at various levels of housing value. • The Single Family and Multifamily Program Summary: 1996 to 2001; explaining the programs which are referred to in the "Framework": • The Process Statement for achieving portions of the Richfield Housing Goals by 2001, 2006 and 2010; a 15 year plan which explains the growth in the number of housing units. • The draft Comprehensive Plan; scheduled for completion in 1996. Recommended Motion: Authorize the Executive Director to submit the Housing Action Plan to the City Council for consideration if authorized and forward the plan to the Metropolitan Council. Basis of Recommendation: 1. The action plan is consistent with community goals. 2. The submission of this action plan is the next step in the City Council and HRA participation in Metropolitan Livable Communities Act programs. 3. The Metropolitan Council requires the submission of an action plan by June 30, 1996. 4. The action plan is a reasonable response to Richfield goals. Considering all public and private market actions are taken into account, the action plan represents a reasonable approach to desirable community goals. 5. Check points at five year intervals (2001 and 2006) provide an opportunity to adjust goals for market conditions and resources as they change over time. Alternative Recommendation: Modify the action plan. Discussion/Decision Mode: The action plan will be finalized with the Metropolitan Council after HRA and City Council review. Respectfully submitted, Jame .Prosser • Executive Director JDP:cak Richfield Housing Goals and Housing Action Plan 1996 to 2010 in response to the Metropolitan Livable Communities Act C7 Presented by THE RICHFIELD. HOUSING AND REDEVELOPMENT AUTHORITY and THE CITY OF RICHFIELD June 1996 ICHFT LD ~~ ~ Richfield Housing Action Plan Contents ^ Executive Summary of the Plan. ^ Housing Goals Agreement. ^ Housing Program .and Marketplace Framework. ^ Single Family Program Summary, 1996 to 2001. ^ Multifamily Program Summary, 1996 to 2001. ^ Process. Statement for Achieving Richfield Housing Goals, 1996 to 2010. ^ The Draft Comprehensive .Plan; scheduled completion in 1996. ~ Richfield Housing Action Plan Executive Summary In 1995, The Minnesota State Legislature created the Livable Communities Act and directed the Metropolitan Council of the Twin Cities Metropolitan Area to oversee the development of Housing Action Plans. The Plan for the City of Richfield reflects unique market challenges. To summarize: ^ Richfield is found to be a very affordable place to live and is committed to maintaining a supply of affordable .housing choices. ^ Richfield needs a more diverse housing stock. Richfield should encourage single family market .rate new construction and remodeling which will increase home values. Richfield should also promote the construction of attached and detached townhomes which provide greater life-cycle housing .choices. ^ Richfield needs a greater variety of apartment choices. The "Housing Goals Agreement" presents the goals (index) and a fifteen year proposed change in the index (the benchmark) which were developed by the Metropolitan Council. The City Council and Richfield Housing and Redevelopment Authority responded with goals, in five year increments given best efforts, market conditions, and resource availability. Richfield's goals are further supported with materials in the plan, including the following: ^ Housing Program and Marketplace Framework and Program Summary; describing local program responses at various marketplace value segments. ^ The Process Statement for Achieving Richfield Housing Goals; .explaining the strategy for creating life cycle housing and increasing housing choices -and housing density. ^ The 1996 Draft Comprehensive Plan; outlining proposed changes in land use and density over the long term. C] • Housing Goals Agreement Metropolitan Livable Communities Act PRINCIPLES The City ofRichfield supports: O A balanced housing supply, with housing available for people. at all income levels. © The accommodation of all racial and ethnic groups in the purchase, sale, rental and location of housing within the community. ® A variety of housing types for people in all stages of the life-cycle. ® Acommunity ofwell-maintained housing and neighborhoods, including ownership and rental housing. OO Housing development that respects the natural environment ofthe community while striving to accommodate the need for a variety of housing types and costs. ® The availability of a full range of services and facilities for. its residents, and the improvement of access to and linkage between housing and employment. GOALS To carry out the above housing principles, the City ofRichfield agrees to ^ Use benchmark indicators for communities of similaz location and stage of development as affordable and life-cycle housing goals for the specified periods. ^ . Make its best efforts, given market conditions and resource availability, to remain within or make progress towazd these benchmarks. ^ These goals will be reviewed by the Richfield Housing and Redevelopment Authority (HRA) in 2001 and 2006. CITY INDEX BENCHMARK RICHFIELD GOAL FORRICHFIELD (1996 to 2001) (1996 to 2001) • Affordability Ownership 97% 64-77% 92% Rental 64% 32-45% 59% Life-Cycle Type(Non-single family detached) 36% 38-41% 36-41% Owner/RenterMix 65/35% 64-70 / 30-35% 65-70 / 30-35% Density Single-Family Detached 3.6/acre 2.3-2.9/acre 2.9-3.6/acre Multifamily 21/acre 11-15/acre 15-21/acre To achieve the above goals, the City of Richfield elects to participate in the Metropolitan Livable Communities Aet Local Housing Incentives Program, and will prepare and submit a plan to the Metropolitan Council by June 30,1996, indicating the actions it will take to carry out the above goals. CERTIFICATION ~, January 15, 1996 Mayor Date • • ~i ~ ~ ~ -d ~a~i .~ '~ ~ ~ ~ ~ T ~ ~ ~ ~ ~ U ~ ~ ~ ~ ~ c ~ .c ^~ H H p4 a N ~ ~~ ~ ~ ~ ~ ~ ~ ~~ ~ T ~I 3 ~ ~ ~ ~ d ~ ~ ~ a ~ ~ ~ '" ~ ° q ~ ~ ~ ~~ ~ w ~ ~ ~ ~~ ~ q ~ N ~ ~ a o ~ o W .~ ~' ~ ~ .~ .-. ~' ~ q ~{, ~ ~ o .~ ~ O ~ ~ ~ ~ o x -~ x y ~ ~ ~ ~ y y .~ , ice. 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'~"' p O .. U N ~•y ~ ~ '-' ~ N ~ ~ ~~ O~ oQp Q ~w O~ ~ p ~ C ~ ^ ~ ~P i ~ ~ 'b ~ ~ ~ b ~ ~ O BFI ar 7U ~ . ~ ~ ~ 7 ~ U O ~ ;_ O ..~ hT+i p ~ ~ ~ by S1, ~d 'O U .... ~ ~ V~ O c~ N td ~ ~.. ~ ,~ U ~ ~~+ `! • ~ O U U O ~ 'b ~ O ~ O ~ O ~ • ~ • m O ~ ~ f$'' N - ~ ~ ~ p ~ •~ ~ ~ O ~ ~ - H w .~ ~ ~ w y + ~ o o ~, ~ ~, P~ ~ -o ~ w o H «t O ~. ~, ~ a" ~ ~., o ~, ~ W o p'~ ~ o a~ L ° bQ ~ ~ o ~' • ~ ~ ~ D O O ~ bA . ~ ~N•~~ ~ p U ;~ a o ~ 0 0 ~ a .c ~ ~ ~ ~ o c o ~ w o ~ • ~' ~ ' °-d o a, a~ o ,~ 3°o s,~ o ~ a~ >' ;~ ~ ~ ~ ~ 0 ~ ~ .~ ~ o, ~ ~ ~ ~ ~ ~ o p ~ ~ ~ ~ a~ ~ a •N ~ ~ ~ W •~' ~ o o 0 ,o, a i py •~ -r3 y Z •~ a , p ~ .~ Woo ~ w ~•° ° a; ~ n ~~, ~~ z~ ~ H~ ~° Eo z ~ :~ a ~ ~ V1 "'~ a°° RS ~ w '~~ ~ a ~ z o~ Z z ~~ ~ w 0 0o O c~ z~~ oo U ~ -e3 z~~~ ~•-+ -o z~ .~ ~ . ~ ~~ o ~ ~~~ o~~•~ ~~ ~ ~ ~ ~xw ~U~ ~ UH ~ ~ . ~ Process statement for achieving Richfield housing goals 1996-2010 In response to the City ofRichfield Metropolitan Livable Communities Act, -the City ofRichfield and Metropolitan Council have entered into a 15 year housing goal strategy based on "City Index" and "Benchmark" standards developed by the Metropolitan Council. The City ofRichfield is challenged to accomplish the following four objectives: O Increase the ownership ratio of market rate homes to affordable homes. To make progress toward a 15 year goal by 2001, 500 more homes over $115,000 should be provided by public and private initiatives. These goals, performance, and resources would be reviewed. in 2001 and 2006. © Increase the ratio of higher rent units to affordable rent units. To make progress toward a 15 year goal by 2001, 250 units should have higher market values. These goals, performance, and resources should be reviewed in 2001 and 2006. ® Increase the ratio and variety of ownership choices if possible. ® Increase housing density from the present "City Index" if possible. • .._.... ~ r :... ., i`+l .The 62-page "Draft Richfield .Comprehensive Plan, 1996," is a required reference document to include [7 O u-~ v • ~ }}.xv.. ~. Awin ~w.. ~~;~ nR u:'. ;~~.. ~ ~__~: ~ ~~ ti:~w~a;=; ;~. ~ ~.=',', when the Housing Action Plan is submitted to the Metropolitan Council. However, only the cover i page has been included here to minimize paper and printing of multiple copies. The complete copy is available in the Community Development Department. 4---~ U--~ DC d v :~:. ~: :~~• ~~.: ~_,_,~~ r Nif.`/n I~ r ~~ ~~~-~ ~ ~~^:~ T ~~'' . xsnu~r•';~~ ~• ~~~..,~ ` «: 331t ~ ~ ~ ~ %,1: / O~ J _W _ ~ z~ O ~ w > J U 0 ~ ~ w ,..... ~~ 3: ._..... :a.: ~ :_....... + ~K i..i.l.~i ..~4M... ~.wr~ ..r~i...~ 1 .. h. ~rr~ ..L~` ~ rr t '~ ~ t M• )1! .~..~ ~~~ ~~M -~I~ tt~~ ~ w ~ r.~~ ~:~~ ...:... k ~; ~`~~ ~~ ~~ •~ ~.wr~ ~. ~ ~ HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 33 Agenda June 17, 1996 Issue Statement: Request to execute a Subordination, Non-Disturbance and Attornment Agreement for CSM, Shops at Lyndale, Phase IL Background: CSM is finalizing lease arrangements with Baby Superstore, Inc. to occupy space in the Shops at Lyndale, Phase 11. As part of their negotiations, the HRA is being asked to execute the Subordination, Non-Disturbance and Attornment Agreement which is attached. Basically, the agreement will permit Baby Superstore, Inc. to continue operation on the site in the event that CSM defaults under its mortgages with the HRA and the HRA takes the property back. Recommended Motion: Approve and execute the Subordination, Non-Disturbance and Attornment Agreement for Baby Superstore, Inc. relating to Shops at Lyndale, Phase IL Basis of Recommendation: 1. The agreement is necessary prerequisite for Baby Superstore, Inc. to enter into a tenant lease. 2. The proposed agreement has been reviewed by staff and the HRA's legal counsel together with a copy of the proposed lease for the tenant. 3. The agreement will help assure tenancy if the HRA took over the property due to a mortgage default. Alternative Recommendation: 1. Do not. approve: nor execute the Subordination, Non-Disturbance and Attornment Agreement for Baby Superstore, Inc. 2. Delay. approval. Discussion/Decision Mode: Approval and execution of the. proposed agreement will expedite tenant negotiations between CSM and Baby Superstore, Inc. Respectfully submitted, James sser Executiv rector JDP:cak SUBORDIN.A'X`l<ON, NON-DISTURBANCE AND ATTORNMENT AGREEMENT STATE OF MINNESOTA COUNTY OP HENNEPIN T}IIS AGREEMENT, made cad entered into this _ day of _ , 1996, by and between THE HOUSING ANri REDEVELOPMENT .AUTHORITY ~ AND FOIL T)~E CITY OF RIC~LD, MINNESOTA, whose main address is (the "Lender"), and BABY SUPERSTORE, ><IVG, a South Carolina corporation, ,with its home office located at P. O. Box 100, Duncan, SC 29334 (the "Tenant"). w TT1~~~~~T~t: WHEREAS, TerAant entered into that certain lease .agreement dated February 27, 1996 (the "L.ease"), wrth CSM INVESTORS, INC., a Mv~esota corporation (the "LantUord"} for premises (tb~e "Premises"} comprised of approximately 42,050 square feet located in The Shops at Lyndale Phase II (the "Shopping Center"}, situated in the City of Richfield, County of Hen~aepin, State of Mraoaesota, which'Shopping Center is ~oaore particaularly descn'bed on 'bit "A" attached hereto and by this reference made a part hereof; and `t~~HEREAS, Lender is the holder of certain mortgages ("Mortgages"} of the Shopping Center, o~vi ever that tb~e Ixase shall be subordinated to the lies of the Mortgages executed by Landlord in .favor of the Lender dezttiified an Exhibit "B" attached. hereto. and by this reference made a part hereof (hereinafter collectively refereed to as the "Mortgage"); and WAaS, Tenant as a means of fac~itatigg the proposed financing of the Shopping Center by Lender is willing to subordinate its interest in the Lease provided it is assayed of the continued quiet enjoyment and occupancy of the Premises and the Common Areas of the Shopping Center under the tenors and provisions of the Lease; NOW, T)~EREFORE, for good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows: I _ The Lease shall lac subordinate cad subject to the IVlortgage insofar as_it affects the real property ofwhich the Premises form a part, and. to all reztewals, modifications, .consolidations, replacements cad extensions thereof; provided, ho~rever, that the subordination shalt be subject to the condition that so long as the Tenant is not in default (i.e. with all applicable acre periods haviAg expired for the correction of :said default) in the performance of .any of the :terms of -the Lease, Tenant's possessiozz and quiet enjoyment of the Premises and the Common- Areas of the Shopping Center,. together with alI of Tenant's other rights, privileges and powers under the Lease, shall not be 56677-2 56'1Q.91 • VVi{-11-.7v a r =.~.s sa~v.a .-.... ~...-..~ ...~. ~~~.. ___ ____ _- _---_ _. diminished yr interfered with in any way by Lender or anyone claiming an interest in .the real property se~vred under the Mortgage. Notwit~astanding theforegoing, Lender hereby waives any and .all liens, chinas, demands, or rights, including, but not limited to, rights of Levy, execution, sale and distraint for unpaid rent, or any other right, interest ox lien which Lender has or may hereafter acquire is any of Teua~at's moveable trade haZtui~es and equipment, signs, appliances, furniture and other personal property o~whatever nature and kind installed in the Premises at any Hume by Tenant_ 2. The Tenant hereby cause~ats to such subordination of the Lease to the Mortgage. 3. In the evemt it should become necessary to foreclose the lien of the Mortgage, the Lender and/or the Trustee thereunder will not joiua Tenant. in any suuamary or other foreclosure proceedings, unless required by law. 4. In the evenE that the Lender shall, in accordance with the foregoing, succeed to the interest of the Landlord under the Lease, the Lauder agrees to be bound to the Tenant under aII of the terms, covenants and conditions of the Lease from and after the date of succession; provided, however, the Lender shall not be: (a) liable for any act or omission of any prior landlord (including Landlord}; or (b) subject to any setoffs or defenses wbuch the Tenant might have against any prior landlord (mcluding .Landlord), except for setoffs or defenses which arose out of a default by a prior landlord ('including Landlord) under the terms and provisions of the Lease anti for which default Lender sha11 have beam granted the same period of notice and the same right to :cure as provided Landlord in Section 14.2 of the Lease; or (c) bound by any rent or additional rent which the Tenant might have paid for move than the current navnth to the Landlord; or {d} bound by any amendment or modificaxion of the Lease made without its consent; it being specifically agreed that Lender hereby affums its consent to the Lease and aU of the terms 2tmd provisions contained therein. 5. Leader hereby agrees that any insurance proceeds, payable under those policies of insurance maintained pursuant to the Lease and arising by reason of destruction or damage of the Premises and the Shopping Cemer, and any condemnation awards secured by Lender as a result of the condemnation of all or any part of the Premises and/or the Shopping Center shall be used for restoration and repair pursuant to Article XII and Article ~ of the Lease. 6. All of the terms, covenants, and conditions of this Agreement shall run with the land and shall be binding upoa and inure to the benefit of the parties hereto and their respective legal representatives, successors and assigns. s~~, z ssm.si ~ • 7_ Tbis Agreement may not be xnnadified orally or in any other manner other than by an agreement in writioug signed by the parties hereto or their respective successors in imerest. The terms and provisions of tuffs Agreement shaA be governed by the laws of the State in which the Premises are located. IN W~~'NESS WHEREOF, the parties hezeto have caused this Agreement to be duly executed under seal the day and year First above written. LE : THE HOUSIiV'Q AND REDE'V'ELOPMEN'T' AUTHQRT'T'Y' TN AND FOR .THE CXTY OF RICHRLET,T), MINNESOTA $y: Its: By: Its: . TENAN - RARY SUPETtSTORE, INC., a South Carolina corporatipn By: Its: Attest: (Asst.} Secretary {CORPORATE SEAL) s6sn z ssmsi 3 JUlV-il-~G 1~=aY r.cva•.=r.a.. r.-..... ...~. .~......~ ...~. .. ~.... __ _______.__- ac~avowLEn~ma~lv~r STATE OF ) ss. COUNTY OF On this day of .1996, before me, a Notary Public within and for CouzAty, personally appeared the of BABX SUPERSTORE, INC., a-South Carolina corporation, and acknowledged the foregoing iastcumtent on behalf of the corporation Notary Public STATE OF ) } ss. COUNTY OF On this day of .1996, before me, a Notary Public within and for County, personally appeared the and the of THE !`IOUSING AND ~D!/VELOPMENT AUTHORITY IN .AND FOR. THE CITY OF RiCHI"'IELD, lvJfINNESOTA, a and acZaaowledged the foregoing instrument on behalf of the Notary T'ublic .ssarr i scm 9r 4 • • HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 32 Agenda June 17, 1996 Issue Statement• Adoption of resolution approving modifications to the Richfield Home Rehabilitation Deferred Loan Program. Background• The HRA's Richfield Home Rehabilitation Deferred Loan Program provides rehabilitation assistance to lower income Richfield homeowners. Each year the HRA utilizes a portion of the CDBG funds allocated to the City from Hennepin County for rehabilitation loans. By assisting approximately 15-20 households each year, the Deferred Loan Program plays an important role in achieving an HRA goal to preserve and maintain the City housing stock. Since 1976 over 300 households have benefited from CDBG funded repairs. Major building system repairs usually. include electrical and plumbing updating, furnace replacement, weatherization, roofing and other exterior maintenance. Approximately 50 percent of the funds benefit elderly households. • The Deferred Loan Program is administered by HRA staff in accordance with the Richfield Home Rehabilitation Program Procedural Guide. The guide, based on program criteria established by Hennepin County and the HRA, last had revisions in April 1995. Recently, the County modified the Deferred Loan Program criteria and requests HRA concurrence. In addition, staff has refined this criteria to enhance local administrative needs. Four main changes are identified: 1. Expand and refine definitions of terms used in the program. 2. Increase administrative options for verifying accurate income for program eligibility. 3. Modify asset requirements for eligibility. 4. Add an option for Three Percent Interest Deferred Loans for specified situations. The new loan program option helps seniors on fixed incomes that can not secure other repair financing and yet their income may exceed maximum income allowed presently. Recommended Motion: Adopt the resolution authorizing the identified modifications to the Richfield Home • Rehabilitation Procedural Guide. • Basis of Recommendation: 1. The modifications will: • Enable more thorough verification of individual income and assets. • Accommodate needs of .certain moderate-income Richfield homeowners that cannot secure resources from traditional lender programs but desire to make home repairs. • Facilitate more efficient program administration. 2. Adding the low interest loan program has been successful for Bloomington HRA and Hennepin County administered programs that attempt to respond to unique client needs. Alternative Recommendation: 1. Do not authorize modifications to the Home Rehabilitation Deferred Loan Program. This would preclude improvements to the program and hinder program effectiveness. 2. Approve only some of the proposed changes. Discussion/Decision Mode: • If approved, the recommended modifications can become effective immediately as Hennepin County already supports the changes. Respectfully submitted., James rosser Executi irector JDP:cak C] HRA RESOLUTION NO. RESOLUTION AUTHORIZING APPROVAL OF MODIFICATIONS TO THE HOME REHABILITATION DEFERRED LOAN PROGRAM WHEREAS, the Richfield Housing and Redevelopment Authority provides a Rehabilitation Deferred Loan Program which utilizes Hennepin County provided CDBG funds to assist lower income homeowners with rehabilitating their homes; and WHEREAS, the program's Procedural Guide was approved by the HRA in 1995 and is modified periodically as program requirements and needs dictate; and WHEREAS, Hennepin County and. Richfield staff have identified modifications to the program's Procedural Guide; and WHEREAS, the HRA has reviewed these modifications. NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota that the Richfield Rehabilitation Deferred Loan Program Procedural Guide will be modified as described in Exhibit A attached. Passed by the Housing and Redevelopment Authority of Richfield, Minnesota this 17th day, of June, 1996. Thomas E. Harms, Chair ATTEST: Vern Luettinger, Secretary • Exhibit A June 17, 1996 HRA HOME REHABILITATION DEFERRED LOAN PROGRAM Modifications 1. Definitions: MHFA: Minnesota Housing Finance Agency CDBG: Community Development Block Grant Hennepin County: The administering agency for CDBG funds from U.S. HUD. Emergency Situation: Repairs that are needed which require priority processing of an application for funds. Three Percent Interest Loan: A deferred loan which accrues an interest during the term of the loan depending on client eligibility. 2. Income Verification; Required Supplemental Forms: . A release form for obtaining a credit report or other supplementary information. • Copies of federal income tax returns of all applicants to verify income for the preceding two years. • Credit application, if warranted. 3. Asset Requirements: • Employer,mandated retirement programs are not included as assets provided that the only means of access to those funds is through retirement or termination of employment. • Business equipment is not regarded as an asset if the business is incorporated. An exception exists when the corporation is an S Corporation with members of the household as shareholders. In this instance, the household is regarded as having assets equal to the proportional value of shares held to total assets held. 4. Three Percent Interest Deferred Loans in Specified Situations: A. Improvements: Three Percent Interest Loan improvements may include all improvements as specified under the regular Deferred Loan Program. • B. li i i i Three Percent Interest Loans may be made to applicants who meet the following criteria: 1. Applicant may have qualified at the time the application was submitted, but while on the waiting list, income limits changed or applicant's situation changed, making their income ineligible per the 50% of area median standard. Therefore,. eligibility is based on 80% of the area median income. Applicant's assets must be insufficient to make required improvements. 2. Applicant has no other means for making required improvements; an inability to make minimum monthly payments, to qualify for an MHFA or other loan, or a demonstrated lack of cash reserve assets. 3. Applicant must be at risk in some manner, .such as being elderly with a fixed income or being faced with a substantial health or safety issue, as determined by staff inspection. The three percent loan is only offered after all other resources are explored and found not to be available. . C. Program Income Limits: MSA: MPLS/ST. PAUL FY 1996 MEDIAN HOUSEHOLD INCOME: $54,600 Household Size (50%) Very Low Income (80%) Low Income 1 Person $19, 100 $29,100 2 Person $21,850 $33,300 3 Person $24,550 $37,450 4 Person $27,300 $41,600 5 Person $29,500 $44,950 6 Person $31,650 $48,250 C HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 31 Agenda June 17,.1996 Issue Statement• Adoption of a resolution authorizing the purchase of 7027 Columbus and 6621 Girard Avenues and 2916 West 71 1/2 Street under Richfield Rediscovered. Backar The following•properties have been selected for purchase under Richfield Rediscovered. Appraisals have been conducted on all properties. The negotiated purchase price and appraised value are the same, as follows: Address ~poraised Value 7027 Columbus Avenue $56,000 6621 Girard Avenue $45,000 2916 West 71 1/2 Street $59,000 The properties have been .determined to meet program requirements for acquisition. These sites are initially being. offered to New Ford Town and Rich Acres residents. Ten New Ford Town and Rich Acres relocatees have already been served through the Richfield Rediscovered Program. Interest remains high. A description of existing conditions at each property is attached.. Recommended Motion: Adopt the resolution authorizing: • 1. The purchase of the properties at 7027 Columbus Avenue for $56,000; 6621 Girard Avenue for $45,000; and 2916 West 71 1/2 Street for $59,000. 2. The Executive Director and HRA Chairperson to execute purchase agreements and other documents to effectuate the purchase. Basis of Recommendation: 1. The properties meet program requirements for acquisition. 2. Funding for Richfield Rediscovered acquisitions is available. 3. The owners have voluntarily indicated an interest in selling their property to the HRA. 4. Purchase has been negotiated at the appraised value. Alternative Recommendation: Do not authorize acquisition. Discussion/Decision Mode: Agreements to purchase are ready to be prepared in final form. Respectful) submitted, i James rosser Executi irector JDP:cak • HRA RESOLUTION NO. RESOLUTION AUTHORIZING PURCHASE OF REAL PROPERTIES LOCATED AT 7027 COLUMBUS AVENUE 6621 GIRARD AVENUE 2916 WEST 71 1/2 STREET FOR THE RICHFIELD REDISCOVERED PROGRAM WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA) desires to purchase certain real property pursuant to and in furtherance of the Richfield Rediscovered Redevelopment Project (Project) heretofore adopted by the City of Richfield (City) and the HRA, said real properties being described as follows: 7027 Columbus Avenue: The south 75 feet of North 106 feet of that part of West 1/2 of the Southeast 1/4 of Northeast 1/4 of Northwest 1/4 lying East of West 30 feet. 6621 Girard Avenue: Lot 19, Block 1, Blossom Park Addition 2916 West 71 1 /2 Street: the East 1 /2 of South 1 /2 of Lot 57, Sabin Lake Harriet Garden Lots Addition; and i WHEREAS, the HRA is authorized by Minnesota Statutes Section 469.012 to acquire real property within its area of operation; and WHEREAS, the properties meet all program requirements for acquisition; and WHEREAS, the HRA has caused appraisals of the subject properties to be made by a qualified independent professional real estate appraiser and has negotiated purchase prices with the owners based on stated values; and WHEREAS, funds have been provided by the HRA and are available for acquisition. NOW, THEREFORE, BE IT RESOLVED by the Richfield Housing and Redevelopment Authority: 1. The purchase prices are approved as follows: Address Purchase Price 7027 Columbus Avenue $56,000 6621 Girard Avenue $45,000 2916 West 71 1/2 Street $59,000 2. That the Chairperson and Executive Director are authorized to execute a Purchase Agreement and other documents to effectuate purchase for the amounts set forth in this resolution. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 17th day of June, 1996. Thomas E. Harms, Chair ATTEST: Vern Luettinger, Secretary • Attachment June 17, 1996 HRA SUMMARY OF PROPOSED PROPERTY ACQUISITIONS (as of June 17,1996) RICHFIELD REDISCOVERED PROGRAM Existing Property Conditions 7027 Columbus Avenue South. This is a small house (816 sq. ft.) that would be very difficult to remodel.. An attached single garage .was made into a family room; it has one bedroom. Several repairs are needed such as updating the substandard wall heating units, replacing deteriorated windows, and replacing the roof and rotted fascia and soffits. The house is on a slab and has no attic expansion possibility. 6621 Girard Avenue South. The house sits back on the lot, with an attached, single car garage which is in very poor condition. It has a partial basement. Location on the lot and layout make it a poor candidate for future remodeling. Extensive repairs are needed to bring it up to marketable condition, such as replacing the windows, replacing the red-tagged heating system, alleviating a wet basement, and updating all floor coverings and painting. -.Roof life is limited. • 2916 West 71'/: Street. The 1'/: story house has many internal problems. The electric, plumbing and heating systems all need repair to meet code. The tuckunder garage is highly prone to storm water flooding, and needs repair to its floor, exterior wall and new doors. The interior finishes need updating. The floor plan for the house is dysfunctional, creating .remodeling challenges which are not cost effective to install. • HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 30 Agenda-June 17, 1996 Issue Statement: Approval of a resolution authorizing eminent domain proceedings to acquire the real property located at 6205 Morgan Avenue for inclusion in the Richfield Rediscovered Program. Background• On April 29, 1996, the HRA authorized an assignment agreement with State Farm Fire and Casualty to purchase State Farm's $83,700 interest in the fire damaged property at 6205 Morgan Avenue for a cost of $25,000. The HRA's legal counsel has since further concluded that the complicated combination of mortgage foreclosure, bankruptcy, commercial credit claims, IRS tax liens, and law suits and counter suits for fire insurance claims will effectively prevent the property from being sold or repaired in a timely manner. Recommended Motion:• Adopt the resolution authorizing -eminent domain proceedings to acquire the real. . property located at 6205 Morgan Avenue. Basis of Recommendation:. _ , 1. Afire occurred in November 1993. Property maintenance has been a concern for neighbors, and requires frequent responses by public safety staff to minimize appearance problems... 2. The HRA has Richfield Rediscovered Program resources to acquire and clear or remodel the home. Both. strategies continue to be explored by staff. 3. Legal counsel indicates that the eminent domain proceedings ir1 combination with the previously arranged assignment with State Farm will limit all other claims. against the property. 4. To the best of staffs knowledge, the $25,000 cost of the assignment agreement with State Farm also represents the cost of acquisition, unless directed differently by the court during the condemnation process. The maximum exposure would be $35,000 which is the value assigned to the property by an appraisal report undertaken on behalf of the HRA. 5. Eminent domain proceedings effectively end the .problem of a vacant house with significant fire damage and financial liens which are preventing the near term resolution sought by the neighborhood. r Alternative Recommendation: Choose not to acquire the property. The time frame for property improvements by the owner is unknown and would likely be one to two years minimum. The source of financial resources available to the owner is unclear given the financial claims presently against the property. Discussion/Decision Mode: Eminent domain proceedings would be initiated immediately. Respectfully submitted, James rosser Executiv irector JDP:cak • • • HRA RESOLUTION NO. RESOLUTION AUTHORIZING EMINENT DOMAIN PROCEEDINGS TO ACQUIRE CERTAIN REAL PROPERTY LOCATED AT 6205 MORGAN AVENUE WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield ("HRA") is a public body corporate and politic and subdivision of the State of Minnesota organized and operating under Minnesota law, as amended, and is authorized by Minnesota Statutes Ch. 469 and other laws to acquire real estate by exercising the power of eminent domain under and pursuant to Minnesota Statutes, Ch. 117; and WHEREAS, the HRA has previously established a program pursuant to Minnesota Statutes, Sections 469.001 et sea. to provide for the acquisition of land and construction of decent, safe and sanitary housing; and WHEREAS, the redevelopment of certain real property located in the City, legally described as Lot 2, Bloc 1, Melbar,.according tothe recorded plat thereof and situated in Hennepin County Minnesota is consistent and in furtherance of the HRA's. programs and. the City's Comprehensive Plan;_and • WHEREAS, the HRA heretofore has approved the execution of arr agreement which provides forahe assignment to the HRA of certain interests in the Subject Property; and WHEREAS, the HRA has determined that it is necessary to acquire title to and possession of the Subject Property by the earliest date permitted in accordance with Minnesota Statutes 117.042. NOW, THEREFORE, BE IT RESOLVED by the HRA, as follows: 1. It is necessary to acquire the Subject Property as described in this resolution in order for the HRA to carry out the purposes for which it was established. 2. Acquisition of the Subject Property by eminent domain, in the manner provided by Minnesota Statutes, Chapter 117, is deemed to be necessary and for a public purpose and is .hereby authorized. 3. The HRA deems it necessary, to proceed without delay under Minnesota Statutes, Section 117.042, to acquire title to and possession of the Subject Property prior to the filing of a final report of commissioners. 4. The HRA's attorney and staff are authorized and directed to commence eminent domain proceedings to acquire fee simple absolute title to the Subject Property, • pursuant to Minnesota Statutes, Section 117.042 and to pay to the owner(s) or into court, a sum of money to secure compensation to the owners of the Subject Property, which amount shall be equal to petitioner's approved appraisal of value as determined by HRA staff. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 17th day of June, 1996. Thomas E. Harms, Chair ATTEST: Vern Luettinger, Secretary: • HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 29 Agenda June 17, 1996 Issue Statement• Public hearing and consideration of resolution authorizing the sale of Richfield Rediscovered property at 7625 Emerson Avenue to, Choice Wood, Inc.; the continuation of a public hearing at 7200 Third Avenue; and cancellation of public hearing regarding sale of 6621 Girard Avenue. Background• The property at 7625 Emerson was acquired by the City during the 77th Street Project. The HRA approved the purchase of 7625 Emerson Avenue in September 1995. The City Council met on June 10 for the first reading of the transitory ordinance to sell the site to the HRA. The public hearing and second reading are scheduled for June 24. A copy of the proposed development plan is attached. Choice Wood, Inc. will move a house onto the site from West 74th Street where a future cluster home development is planned. After the move, the house will have a substantial addition, remodeling and landscaping. The end value of the property will be approximately $150,000. The price of the lot is $25,600. Performance security in the amount of $25,600 will be • required. The builder/buyer team that has reserved the site at 7200 Third Avenue continues to finalize plans and costs. The public hearing should be continued to the July 15, 1996 HRA meeting. Potential buyers of the lot at 6621 Girard Avenue have selected an alternative lot at 7638 Third Avenue. The lot at 6621 Girard Avenue will be marketed with other potential sites under the Richfield Rediscovered Program. Recommended Motion: Following the public hearing: 1) adopt the resolution which authorizes the Chair and Executive Director to sell 7625 Emerson Avenue to Choice Wood, Inc.; 2) continue the public hearing to se117200 Third Avenue to the July 15, 1996 HRA meeting; and 3) cancel the public hearing on 6621 Girard Avenue. Basis of Recommendation: 1. Choice Wood, Inc. is an experienced and financially secure builder. 2. Development of 7625 Emerson Avenue is contingent on City Council authorization to sell this property to the HRA. 3. A Development Agreement has been negotiated in conformance with program guidelines. 4. Notice of public hearing was published in the Sun-Current on June 5, 1996. 5. The Planning Commission found the disposition of the Emerson property to be consistent with the Comprehensive Plan. 6. The builder/buyer team that wants to develop 7200 Third Avenue has not finalized their plans. A continuance at this time will allow the public hearing and sale to be authorized on July 15. 7. The buyers of the lot at 6621 Girard Avenue have selected an alternative lot. Thus, no sale of the property on Girard is scheduled at this time and the public hearing should be canceled. Alternative Recommendation: Direct. staff to find other buyers. Discussion/Decision .Mode: The City Council is scheduled to have the public hearing and second reading of the ordinance to sell 7625 Emerson Avenue to the HRA on June 24, 1996. Respectf ly submitted, i Jam .Prosser Execu ive Director JDP:cak HRA RESOLUTION NO. RESOLUTION AUTHORIZING THE SALE OF REAL PROPERTY LOCATED AT 7625 EMERSON AVENUE TO CHOICE WOOD, INC. IN ACCORDANCE WITH A DEVELOPMENT AGREEMENT WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield, .Minnesota (HRA) desires to develop certain real property pursuant to and in furtherance of the Richfield Rediscovered Program Redevelopment Project (Project) heretofore adopted by the City of Richfield (City) and the HRA, said real property being described as follows: Addres,~ Leaal 7625 Emerson Avenue Lot 1, Block 1, Cloverleaf Addition, Hennepin County WHEREAS, the HRA is authorized to sell real property within its area of operations after public hearing; and WHEREAS, the City has initiated the process to sell the referenced property to the HRA; and WHEREAS, contingent. on that process, the HRA has authorized the purchase and identified a developer; and WHEREAS, Choice Wood, Inc. is the developer of 7625 Emerson Avenue in accordance with a development agreement; and WHEREAS, the public hearings have been held after proper public notice. NOW, THEREFORE, BE IT RESOLVED by the Richfield Housing and Redevelopment Authority: 1. A public hearing has been held and 7625 Emerson Avenue is authorized to be sold. for $25,600 in accordance-with a development agreement to Choice Wood Inc., contingent on the sale of the property by the City to the HRA. 2. The Chairperson and Executive Director are authorized to execute the Development Agreements, and other agreements as required to effectuate the sales. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield,. Minnesota this 17th day of June, 1996. U Thomas E. Harms, Chair ATTEST: Vern Luettinger, Secretary .. N89.55`12"E - = ~'-7.40 `LOT 1 ~i - .~NO.06' 23 "W • 4.02 - • •....~..n..~.. •.~n~xw s... ~•~umxx.n...~~. .n w. rw.~..~~..~~....~.~ ..... ~..~.r..... ..i .~i. ~[_ EAST LINE Sw'~4 ==:SE'~4 ----~ - _~ ... d -~,_... 2 3 ,. 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