03-20-2017 Complete AgendaREGULAR HOUSING AND REDEVELOPMENT AUTHORITY MEETING
RICHFIELD MUNICIPAL CENTER, COUNCIL CHAMBERS
MARCH 20, 2017
7:00 PM
Call to Order
Oath of office of Ri chfi eld Housing and Redevelopment Authority Commissioner, Mi chael Howard.
Oath of office of Ri chfi eld Housing and Redevelopment Authority Commissioner, Sue Sandahl.
Approval of the Minutes
Approval of the minutes of the Regular Housing and Redevelopment Authority Meeti ng of January 17, 2017.
AGENDA APPROVAL
1.Approval of the Agenda
PRESENTATIONS
2.2016 Year i n Review
3.Consent Calendar contains several separate items which are acted upon by the HRA in one motion.
Once the Consent Calendar has been approved, the individual items and recommended actions have
also been approved. No further HRA action on these items is necessary. However, any HRA
Commissioner may request that an item be removed from the Consent Calendar and placed on the
regular agenda for HRA discussion and action. All items listed on the Consent Calendar are
recommended for approval.
A.C onsideration of the approval of a resolution designating certain financi al i nstitutions as depositories for the
Housi ng and Redevelopment Authority for 2017.
Staff Report No. 9
B.C onsideration of the approval of revisions to the Transformation Loan Program Guidelines updating the
administration of the Program.
Staff Report No. 10
C.C onsideration of the approval of revisions to the Richfield Rediscovered Lot Sale Guidelines and the
Redevelopment Credit Program Gui delines.
Staff Report No. 11
D.C onsideration of the approval of recommended revisions to the New Home Program Guidelines.
Staff Report No. 12
E.C onsideration of the approval of a resolution authorizing an interfund loan up to $400,000 for advance of
certain costs in connection with the Interchange Tax Increment Financi ng District.
Staff Report No. 13
F.C onsideration of the approval of a resolution approving a Subordination Agreement related to Richfield
Urban Village.
Staff Report No. 14
4.Considerati on of items, if any, removed from C onsent Calendar
RESOLUTIONS
5.Considerati on of the approval of a resoluti on approving the Assignment and Assumption of Contract between
Mesaba C api tal Development, LLC, RM Senior Li ving Richfield LLC, and the Housing and Redevelopment
Authority, and Second Amendment to Contract for Private Development between RM Senior Living Richfield LLC
and the Housi ng and Redevelopment Authority.
Staff Report No. 15
OTHER BUSINESS
6.Considerati on of the approval of a Contract for Private Development between the Housing and Redevelopment
Authority and Endres Custom Homes, Inc. for the redevelopment of 6836 Irvi ng Avenue under the Richfield
Rediscovered C redit Program.
Staff Report No. 16
HRA DISCUSSION ITEMS
7.HRA Discussion Items
EXECUTIVE DIRECTOR'S REPORT
8.Executive D i rector's Report
CLAIMS AND PAYROLLS
9.Claims and Payrolls
10.Adjournment
Auxiliary aids for individuals with disabilities are available upon request. Requests must be made at least 96
hours in advance to the City Clerk at 612-861-9738.
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING MINUTES
Richfield, Minnesota
Regular Meeting
January 17, 2017
CALL TO ORDER
The meeting was called to order by Chair Supple at 7:00pm
ATTENDANCE
HRA Members
Present:
Mary Supple, Chair; David Gepner; Doris Rubenstein; and Pat Elliott
(arrived at 7:18pm).
HRA Members
Absent:
Michael Howard
Staff Present: Steve Devich, Executive Director,
John Stark, Director of Community Development,
Karen Barton, Assistant Director of Community Development
Julie Eddington, HRA Attorney, Kennedy and Graven
Item #1
OATH OF OFFICE FOR RICHFIELD HRA COMMISSIONER, MICHAEL HOWARD
Due to Michael Howard’s absence, this item was postponed until the February meeting.
Item #2
CONSIDERATION OF THE ELECTION OF THE RICHFIELD HRA OFFICERS FOR
2017. SR No. 1.
Chair Supple opened nominations.
Commissioner Rubenstein nominated Mary Supple to serve as Chair
Motion carried 3-0.
Commissioner Rubenstein nominated Pat Elliott to serve as Vice-Chair
Motion carried 3-0.
Chair Supple nominated Doris Rubenstein to serve as Secretary
Motion carried 3-0.
Item #3
APPROVAL OF THE MINUTES OF THE REGULAR HRA MEETING OF
DECEMBER 19, 2016
M/Gepner, S/Rubenstein to approve the minutes.
HRA Meeting -2- JANUARY 17, 2017
Motion carried 3-0.
Item #4
HRA APPROVAL OF THE AGENDA
A discussion was added to the agenda regarding the Southdale Library redevelopment.
M/Gepner, S/Rubenstein, to approve the agenda as modified.
Motion carried 3-0.
Item #5 HRA APPROVAL OF THE CONSENT CALENDAR
A. Consideration of the approval of designating the Community Development Director as
the Acting Executive Director of the HRA for 2017 in the event the Executive Director is
absent from the City.
Staff Report No. 2
B. Consideration of the approval of resolutions designating official depositories for the
Housing and Redevelopment Authority for 2017, including the approval of collateral.
Staff Report No. 3
C. Consideration of the approval of a Consultant Services Agreement with the Greater
Metropolitan Housing Corporation for 2017.
Staff Report No. 4
D. Consideration of the approval of a Consulting Agreement with the Center for Energy and
Environment for the Residential Energy Program.
Staff Report No. 5
E. Consideration of the approval of a revised fee schedule for Housing and Redevelopment
Authority housing programs.
Staff Report No. 6
Chair Supple and Commissioner Gepner asked about the depositories that are selected for
the HRA. Executive Director Devich responded to the questions and stated that he would
provide the Commissioners with a list of those institutions.
Commissioner Gepner asked if the Architectural Consultation Program was included under
item C, Consultant Services Agreement with the Greater Metropolitan Housing Corporation.
Assistant Community Development Director Karen Barton responded that it was not part of
the agreement with GMHC. She described the programs available under the Consultant
Services Agreement.
M/Rubenstein, S/Gepner, to Approve the Consent Calendar
Motion carried 3-0.
HRA Meeting -3- JANUARY 17, 2017
Item #6 CONSIDERATION OF AN AMENDMENT TO THE PRELIMINARY
DEVELOPMENT CONTRACT WITH CEDAR PT II LLC.
Assistant Community Development Director Barton presented Staff Report No. 7.
Adam Seraphine, LLC Partnership, presented the HRA with a status update on the project.
He stated that the extension of the agreement is needed to get the project done as one,
rather than two separate parts (townhomes and apartments).
Commissioner Gepner asked what has been the communications with homeowners.
Seraphine responded, and stated that they have been in communications with individual
homeowners about the equity gap issues and the timing of the projects. Moving forward,
they will be providing the HRA with a bi-weekly update.
Commissioner Gepner asked about the grants for the project area that are being submitted.
Assistant Community Development Director Barton responded that while they weren’t
selected for the fall round of Transit-oriented Development (TOD) funding, the application
will be resubmitted for the 2017 funding round. The application is due in February. The
feedback on the initial application was positive, and Assistant Community Development
Director Barton is optimistic.
Commissioner Rubenstein asked if the homeowners were amenable to being bought out.
Assistant Community Development Barton said she believed most were amenable, but that
it would be handled on a ‘first-come, first-serve’ basis.
Community Development Director Stark stated that staff sent a letter out to the
homeowners last week, providing an update and notice of tonight’s meeting. No feedback
was received.
Commissioner Elliott arrived at 7:18pm.
Commissioner Gepner asked if, in the event that the project is separated, would the
development agreement bind the developer to completing both parts of the project.
Assistant Community Development Director Barton responded that those details are yet to
be finalized.
M/Gepner, S/Rubenstein, to approve the resolution approving the first amendment to the
preliminary development agreement with Cedar Point II LLC.
Motion carried 4-0.
Item #7
CONSIDERATION OF AN APPEAL OF A DENIAL OF THE SALE OF A RICHFIELD
REDISCOVERED LOT AT 6345 BLOOMINGTON AVENUE TO T-SQUARED
REPAIR AND REMODELING
Community Development Director Stark reviewed Staff Report No. 8.
Tim Sjoquist, owner of T-Square Repair and Remodeling, resident of 4600 Heritage Hills
Drive, Bloomington, business address: 6009 Penn Ave S, Minneapolis. Mr. Sjoquist first
asked about application process, and feels that the roadblock is happening during the first
HRA Meeting -4- JANUARY 17, 2017
part of the process. He provided an energy-rating worksheet from his previously-built home.
He asked for clarification on the quality standards of the last home he built in Richfield. He
also asked for clarification about the objections to the involvement of the homeowner in his
previous project.
Jon Pues, resident of 6808 14 th Ave S, stated he’s been a lifelong Richfield resident, and
has used the HRA programs multiple times. He noted that there were hiccups during the
construction of the new home on 14th Avenue. He stated that he didn’t have enough time to
address all the issues, and that concerns mentioned in the staff report were not made
known to him prior to the meeting.
Community Development Director Stark stated that communications were made between
the applicant and staff. He stated that he discussed the items listed on the staff report with
Mr. Sjoquist approximately two weeks prior to the HRA meeting, and that staff report was
made public to the applicants.
Executive Director Devich stated that it would be up to the HRA to allot more time to Mr.
Pues.
Community Development Director Stark clarified that concerns about Mr. Sjoquist’s
experience and capabilities were related to new construction, rather than remodeling, and
were based on the construction of Mr. Pues’ first home in 2014. Community Development
Director Stark mentioned that during that project there were four failed inspections, as well
as multiple items listed in building permits results and reports. He also noted that the Chief
Building Inspector, Rick Regnier, stated that during the construction of his first Richfield
Rediscovered home, Mr. Pues had a very high level of involvement, without being licensed.
Mr. Sjoquist responded from the seating area of Council Chambers, and was not audible
via microphone.
Commissioner Rubenstein asked if Mr. Pues would be eligible to reapply with a more
experienced builder and/or project manager. Community Development Director Stark stated
that given the cumulative issues it would be difficult to approve a project, but that each
application would be evaluated separately.
Commissioner Gepner asked how the new home would differ from his existing home. Mr.
Pues stated that the new home would be a rambler, rather than a two-story home. It would
include a multi-generational suite, as his current house does.
Commissioner Gepner asked how many Richfield Rediscovered lots were currently
available. Community Development Director Stark stated approximately seven lots
remained for sale.
Commissioner Gepner asked the applicant why they should not trust staff’s
recommendation on this issue. Mr. Pues stated that he’s been in the building trades his
whole life. Commissioner Gepner asked if the applicant was a builder. Mr. Pues stated that
he is not a builder, but that his background is in retail and design. He has experience
working at Home Depot with specialized customers/accounts. He is very familiar with how
houses go together. He stated that new homes are easier to build rather than remodeled
homes. He stated that he works with realtors and others to help with design. He stated that
design is a matter of personal choice.
Commissioner Elliott asked a question, the beginning of which was in inaudible. He stated
that he doesn’t believe that Mr. Pues can withhold his involvement in this type of project.
HRA Meeting -5- JANUARY 17, 2017
Mr. Pues responded that he did not pull any permits, but only did low-voltage work, which
was allowed.
Mr. Sjoquist stated that they selected their design to help with noise issues, rather than
focusing on the second-story or other features. He stated he is confused about future
applications for this program. He stated that he sent Mr. Pues to inspections to act as his
agent and that he is allowed to be involved in the construction of his new house. He asked
for specific problems with the previous project.
Community Development Director Stark clarified that Mr. Sjoquist was never called a ‘bad
builder’. He also referenced that the HRA’s attorney, Julie Eddington, had reviewed the
program guidelines and was available to answer any questions.
Julie Eddington, attorney for the HRA, stated that the mission of the HRA’s programs is met
by offering subsidies for residential remodeling and new construction projects. The policy
for Richfield Rediscovered does not put any liability or requirements on the HRA to give a
subsidy to all projects that apply. The HRA has the authority to award or deny without being
in danger of claims of discrimination for the reasons given in this specific case.
M/Gepner, S/Elliott to deny the appeal of a denial of the sale of a Richfield Rediscovered lot
at 6345 Bloomington Avenue to T-Squared Repair and Remodeling
Commissioner Rubenstein reiterated that they may re-apply, or that they may build the new
home without utilizing the RR program.
Motion carried 4-0.
Item #8
HRA DISCUSSION ITEMS
Commissioner Rubenstein described the redevelopment project that is being undertaken at
the Hennepin County Southdale Library site. She expressed some concern about the public
participation process that is currently being undertaken. She stated that some staff and
policymakers have been able to attend the meetings. Commissioner Rubenstein stated that
the recommendations being shown at public meetings have not reflected the input gathered
by local stakeholders, especially as it concerns traffic/parking, density and types of use.
She encouraged citizens to get involved in this process to represent Richfield’s priorities.
Commissioners Elliott and Gepner agreed that the process has not accurately reflected the
input given by residents of Edina and Richfield. Commissioner Elliott stated that the next
meeting on February 9 th is extremely important, and will be crucial for Richfield residents to
attend.
Community Development Director Stark commented on his involvement and gave his
perspective on the process.
Chair Supple agreed with Commissioner Gepner’s experience.
Commissioner Gepner asked for an update on Lyndale Gardens. Community Development
Director Stark stated that the developer is exploring the option of selling the property to
another developer, or of bringing in a new development partner. He mentioned that they
have met with one developer that showed interest in the property. Commissioner Gepner
asked if the city has any liability should the project not move forward. Stark stated that the
Metropolitan Council stated that they have never asked for the return of the grant funds
should a project fail to move forward, at no fault of the city. Executive Director Devich stated
HRA Meeting -6- JANUARY 17, 2017
that the site has been improved and that it will be an excellent redevelopment site for the
right developer. He doesn’t believe the current developer will be able to go forward, but that
it will be done in the future.
Commissioner Elliott asked whether the next developer will have similar financial
constraints, due to density limitations that the current developer is experiencing. He stated
that the city needs a developer who has the liquidity to help finance the project without
relying completely on lenders.
Executive Director Devich stated that the density of the site will continue to be a challenge
on the site, but there may be ways to creatively work through the problem.
Commissioner Gepner asked about the grant for Richfield Parkway. Assistant Community
Development Director Barton stated that the trail improvements would begin this spring,
with development to follow in the fall.
Item #9
EXECUTIVE DIRECTOR REPORT
Executive Director Devich had nothing to report to the HRA.
Item #10
CLAIMS AND PAYROLL
M/Elliott, S/Gepner, that the following claims and payroll be approved:
U.S. BANK 1/16/17
Section 8 Checks: 128356 - 128439 $162,903.50
HRA Checks: 32939 - 32971 $ 57,596.38
TOTAL $220,499.88
Commissioner Rubenstein asked about payments to Crossroads at Penn. Community
Development Director Stark responded to her questions.
Motion carried 4-0.
ADJOURNMENT
The meeting was adjourned by unanimous consent at 8:20 p.m.
Date Approved: February 21, 2017
Mary B. Supple
HRA Chair
Karen Barton Steve Devich
Acting City Clerk Executive Director
AGENDA SECTION:Consent Calendar
AGENDA ITEM #3.A.
STAFF REPORT NO. 9
HOUSING AND REDEVELOPMENT AUT HORIT Y
MEET ING
3/20/2017
REPORT PREPARED BY: Chris Regi s, Fi nance Manager
DEPARTMENT D IRECTOR REVIEW: Steven L. Devich, Executive Director
2/15/2017
OTHER DEPARTMENT REVIEW: N/A
CITY MANAGER REVIEW: Steven L. Devich, Executive Director
2/15/2017
IT EM FOR COUNCIL CONSIDERAT ION:
Consideration of the approval of a resolution designating certain financial institutions as depositories
for the Housing and Redevelopment Author ity for 2017.
EXECUT IVE SUM M ARY:
At the J anuary 17, 2017 Housing and Redevelopment Authority (HRA), the HRA board approved three
resolutions that designated official depositories, restricted the deposit of funds to the level of c ollateral, and
designated certain financial institutions as depositories for the investment of HRA funds.
Subsequent to the J anuary 17, 2017 meeting, staff bec ame aware that one depository, W ells Fargo
Institutional Retirement and Trust, was left off the January resolution for depositories for the investment of
HRA funds.
To c ontinue to be in complianc e with Minnesota statutes, it is necessary for the HRA Board to consider the
attached resolution that now inc ludes designating W ells Fargo Institutional Retirement and Trust as a
depository for the investment of HRA funds.
RECOM MENDED ACT ION:
By Motion: Appr ove a resolution designating certain financial institutions as depositories for the
investment of Housing and Redevelopment Authority of Richfield funds in 2017.
BASIS OF RECOM M ENDAT ION:
A.HISTORICAL CONTEXT
N/A
B.POLICIES (resolutions, ordinances, regulations, statutes, etc):
In ac cordanc e with Minnesota Statutes Section 118A.01 - 118A.06, the HRA of Ric hfield must
designate financial institutions annually. The institutions must pledge the collateral over and above
the amount of federal insurance, as public depositories.
Finally, a designation must be made for certain financ ial institutions as depositories for the
investment of HRA funds for 2017. These institutions, suc h as investment brokerage firms, offer
government sec urities in the manner required by law. The following financ ial institutions were
approved at the January 17, 2017 meeting, U.S. Bank Institutional Sales, RBC Capital Markets,
Ray mond J ames & Assoc iates, Northland Sec urities, Oppenheimer & Co., and the 4M Fund. Staff
is now asking the HRA Board to add W ells Fargo Institutional Retirement and Trust as an approved
depository.
C.CRITICAL TIMING ISSUES:
N/A
D.FINANCIAL IMPACT:
N/A
E.LEGAL CONSIDERATION:
The HRA is required by Minnesota Statute 118A.01 - 118A.06, to designate as a depository of
funds, insured banks or thrift institutions. Any c ollateral so deposited is acc ompanied by an
assignment pledged to the HRA in the amount specified in the attac hed resolutions.
ALTERNATIVE RECOMMENDATION(S):
The HRA c ould solic it other financial institutions for offic ial depositories, but past relationships with the
depositories recommended have proven satisfac tory for the City.
PRINCIPAL PARTIES EXPECTED AT MEETING:
None
ATTACHMENTS:
Description Type
Resoluti on Resolution Letter
RESOLUTION NO.
RESOLUTION DESIGNATING CERTAIN FINANCIAL
INSTITUTIONS AS DEPOSITORIES FOR THE INVESTMENT OF
HOUSING AND REDEVELOPMENT AUTHORITY OF RICHFIELD FUNDS IN 2017
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 of Richfield 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, in accordance with Minnesota Statutes, Sections
118A.01 – 118A.06, 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 of Richfield funds that
certain financial institutions be designated as additional depositories for Housing
and Redevelopment Authority of Richfield funds for 2017.
2. The following financial institutions designated as depositories for the Housing and
Redevelopment Authority of Richfield funds:
RBC Capital Markets. Raymond James & Assoc.
4M Fund U.S. Bank
US Bank Institutional Sales Oppenheimer & Co.
Northland Securities, Inc. Wells Fargo Institutional Retirement
& Trust
3. The Treasurer and Finance Manager are hereby authorized to deposit the
Housing and Redevelopment Authority of Richfield 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 Manager’s judgment and as the
interest of the Housing and Redevelopment Authority of Richfield dictates.
4. The investment of funds and the reporting thereof pursuant to this resolution
shall be conducted in accordance with established policies regarding the
investment of these funds.
Adopted by the Housing and Redevelopment Authority of Richfield, Minnesota this 20th
day of March, 2017.
Mary Supple, Chair
ATTEST:
Doris Rubenstein, Secretary
AGENDA SECTION:Consent Calendar
AGENDA ITEM #3.B.
STAFF REPORT NO. 10
HOUSING AND REDEVELOPMENT AUT HORIT Y
MEET ING
3/20/2017
REPORT PREPARED BY: Julie Urban, Housing Specialist
DEPARTMENT D IRECTOR REVIEW: John Stark, C ommunity Development Director
2/14/2017
OTHER DEPARTMENT REVIEW: N/A
CITY MANAGER REVIEW: Steven L. Devich, Executive Director
2/15/2017
IT EM FOR COUNCIL CONSIDERAT ION:
Consideration of the approval of revisions to the Transformation Loan Pr ogram Guidelines updating
the administr ation of the Program.
EXECUT IVE SUM M ARY:
Staff periodically reviews and recommends revisions to the Transformation Loan Program Guidelines
(Guidelines) as needed. The following c hanges to the Guidelines are recommended to reflect how the
Transformation Loan Program (Program) is currently administered.
Recommended to be removed from the Guidelines:
Referenc es to a Pre-Remodeling Condition Report (no longer required due to funding sourc e).
Referenc es to the Richfield Remodeling Advisor.
Recommended to be added/revised:
W hen a homeowner uses a construction loan followed by new, permanent mortgage financing, the HRA
may commit funds but delay closing on the Loan until the homeowner c loses on the permanent
financing.
An individual/household is restric ted to rec eiving one loan every seven y ears (the Guidelines c urrently
limit the Loan to one per property; and two Transformation Loans per lifetime).
Referenc e to the availability of an Architectural Consultant is referenced.
Notice of Data Privac y rules. Under current data privac y rules, the name of the loan recipient and the
fact that they rec eived a loan is public data but all other loan information is to be treated as private.
RECOM MENDED ACT ION:
By Motion: Appr ove the recommended revisions to the Transformation Loan Program Guidelines.
BASIS OF RECOM M ENDAT ION:
A.HISTORICAL CONTEXT
The Transformation Loan provides a financial inc entive to homeowners for initiating major
remodeling of their homes to meet their housing needs. Major remodeling projects are defined as
exc eeding $50,000 in cost. These are eligible for an inc entive loan equal to 15 percent of the
projec t c ost, not to exceed $25,000. The loan is a no-interest, no-pay ments loan that is due and
pay able when the homeowner sells their home or is forgiven after 30 y ears.
Sinc e the Program began in 1993, the HRA has made 184 loans and loaned over $2.2 million.
B.POLICIES (resolutions, ordinances, regulations, statutes, etc):
The goals of the Program are to:
Provide an inc entive to homeowners for initiating major remodeling on their homes to meet their
housing needs.
Inc rease the function and livability of small or outdated Richfield homes.
To inc rease the range of housing options available to individuals and families who want to live or
remain in Ric hfield.
C.CRITICAL TIMING ISSUES:
The revisions are needed to reflect how the Program is c urrently being administered.
D.FINANCIAL IMPACT:
The Program is no longer funded using the Housing and Redevelopment Fund; therefore, a Pre-
Remodeling Condition Report is no longer required. The removal of this inspection requirement
lowers the c ost of administering the Program.
No other revisions have a financial impact on the Program.
E.LEGAL CONSIDERATION:
The Guidelines are a tool for guiding program administration. W hile they do not constitute a
contrac tual agreement or liability by the City or HRA, they provide a c onsistent guide for
administering the Transformation Loan Program and should reflect current prac tices.
ALTERNATIVE RECOMMENDATION(S):
The HRA may c hoose to not approve the recommended revisions to the Transformation Loan Program
Guidelines.
PRINCIPAL PARTIES EXPECTED AT MEETING:
N/A
ATTACHMENTS:
Description Type
2017 Transformation Guidelines Backup Materi al
TRANSFORMATION HOMES
PROGRAM GUIDELINES
FOR STAFF ADMINISTRATION
REVISED: MARCH 2017
1
Table of Contents
Page Number
Table of Contents......................................................................................... 1
Statement of Purpose................................................................................... 2
Program Objectives...................................................................................... 2
Definitions..................................................................................................... 2
Data Privacy................................................................................................ 3
Criteria for Program Eligibility...................................................................... 3
Conditions of the Loan$$$$$$.$$$$$$..................................... 4
Eligible Improvements.................................................................................. 5
Application Procedure.................................................................................. 5
Hold Harmless.............................................................................................. 5
Remodeler Criteria....................................................................................... 6
Responsibility of Remodeler........................................................................ 6
Housing and Site Development Criteria.$$$$........................................ 6
Design Plan Review.................................................................................... 7
Forms/Exhibits............................................................................................. 8
2
TRANSFORMATION HOMES PROGRAM GUIDELINES
The Transformation Homes Program Guidelines have been developed as a tool for guiding
program administration. This document should not be interpreted as constituting any
contractual agreement or liability by the City or HRA.
Statement of Purpose
To help improve and maintain an aging housing stock by providing financial and technical
assistance to homeowners so they may make home improvements and undertake
expansions to accommodate their housing needs.
Program Objectives
• To provide an incentive to homeowners or home buyers for initiating major remodeling on
their homes to meet their housing needs.
• To increase the function and livability of small or outdated Richfield homes.
• To increase the range of housing options available to individuals and families who want to
live or remain in Richfield.
Definitions
City :
The City of Richfield
HRA :
Housing and Redevelopment Authority in and for the City of Richfield.
Homebuyer:
Loan applicant who is in the process of purchasing, remodeling and occupying a Richfield
home.
Homeowner :
Loan applicant who owns and occupies or purchases and occupies the home to be
remodeled.
Lender :
The primary lender working cooperatively with the HRA on home remodeling programs.
Loan :
Interest free loan offered by the HRA for remodeling payable upon sale of the house or
forgiven after 30 years.
3
Remodeler :
A licensed builder or Remodeler who meets the criteria established by the HRA, including all
state and local license requirements.
Remodeling Advisor :
Individual contracted with the HRA who meets with the homeowner to discuss ideas,
estimate costs and answer questions.
Data Privacy
The HRA is subject to Minnesota Statutes Chapter 13 (the “Minnesota Government Data
Practices Act”). Under the Minnesota Government Data Practices Act, the names and
addresses of applicants for or recipients of assistance under this program and the amount of
assistance received under this program are public data. All other financial information
submitted to the HRA for purposes of the loan application is considered private data.
Criteria for Program Eligibility
In order for a project to be eligible for a Transformation Homes Loan, certain conditions must
be met.
1. Project costs for remodeling improvements must be $50,000 or more. The
Transformation Loan will be calculated at 15% of the project cost as determined by the
HRA, not to exceed $25,000.
2. The Homeowner shall provide a copy of the estimate and project specifications from the
selected Remodeler for the work to be done. The Homeowner shall also submit house
plans, a site plan, and any other reasonable information requested.
3. The Remodeler selected by the Homeowner shall be evaluated by the HRA to meet all
remodeling criteria.
4. On a case by case basis, HRA staff may visit the applicant’s property and prepare an
action plan to ensure viability of the project.
5. No work may have commenced on the proposed project if application is being made
under the Transformation Homes Program. Nor may any completed work be considered.
Conditions of the Loan
1. An applicant’s project cost must be a minimum of $50,000. All aspects of the project
must be completed within a reasonable period of time such that all the work may be
considered part of one project.
4
2. Sweat equity may be allowed. The estimated loan amount would be the combination of
contractor and materials cost, but cannot include the value of homeowner labor. Sweat
equity projects must be completed within one year.
3. For applicants obtaining mortgage financing, the full Loan amount may be placed in an
escrow account, if requiredby the Lender. The escrow account will be drawn upon in
prorated increments, simultaneously as funds are drawn upon from the primary Loan to
make payments to the Remodeler. Payment will be disbursed at the discretion of the
Lender, upon satisfactory HRA verification of work in progress. Before the Loan payment
can be provided to the Lender, , the Homeowner must sign the Promissory Note, an
example of which is attached as Exhibit B.
4. In cases where an escrow account is not used, the primary Lender may require a
simultaneous closing with the HRA Loan at the time permanent financing is secured. In
these cases, the HRA may commit funds and authorize a project to begin prior to closing
on the Loan. No funds will be disbursed until closing has taken place.
5. In those situations where the Homeowner is not utilizing the services of a Lender, partial
and/or final loan payments may be issued to the homeowner at or near the end of the
project. Payments will be made upon HRA approval of homeowner submitted
documentation which will include a detailed list of expenditures, supplier and contractor
invoices or receipts, and lien waivers.
6. Before final payment is issued (by Lender or HRA), inspections will be required by both
HRA staff and the City Building Inspector. Upon satisfactory verification of work in
progress, or upon completion, payments will be disbursed at the discretion of the lender
or the HRA.
7. Copies of lien waivers for the full amount of the payment must be provided at the time of
final disbursement.
8. Loan funds are available on a limited basis. The HRA is not responsible for the
unavailability of Loan funds to Homeowner.
9. No interest will accrue on the Loan; no monthly payments are required.
10. Payment of the Loan must be made in full within 30 days upon the sale, conveyance,
assignment, lease or transfer of the property. A Satisfaction of Mortgage in recordable
form will be provided upon receipt of payment. The Loan may also be paid in full at any
time.
11. If the Homeowner still owns and occupies the property, the lien created by the Loan will
be forgiven 30 years from the date of the Promissory Note and Deed.
12. The Loan is a lien against the property. If at any time during the term of the loan, the
HRA is asked to subordinate its position, the HRA subordination policy in effect at the
time of the subordination request will apply. Please consult the Richfield HRA
Subordination and Satisfaction Policy, available at www.cityofrichfield.org/subordinations
or by calling 612/861-9778.
5
13. Only one Loan is available to a Homeowner at any given property location. A
Homeowner may apply for one additional Loan at a different property location no sooner
than seven years following the original Loan.
Eligible Improvements
Eligible improvements include:
a.) Value-added improvements, such as finishing off an additional bathroom or adding
a garage;
b.) Maintenance and repair, such as roof replacement, electrical or plumbing
improvements, or cosmetic updating such as painting or wall-to-wall carpeting,
when done in conjunction with value-added improvements; and
c.) Any other improvements as determined by the HRA.
Non-eligible improvements include:
a.) Swimming pools, hot tubs and greenhouses;
b.) Decorative landscaping.
Application Procedure
The Homeowner must:
1. Meet with an architectural consultant, if requested by the HRA;
2. Submit a complete application, which includes an application form, a copy of all bids
demonstrating project costs, scopes of improvement, and plans;
3. An Application Fee is charged to cover the cost of administering the loan. The application
fee is due at the time the application is submitted.
4. Applications will be reviewed and awarded on a first-come, first-served basis. In addition,
the HRA by its sole determination, will prioritize applicants and reserve funding for those
applicants who demonstrate progress using criteria such as the following:
• Loan commitment from a lender in written form;
• Complete, final and secured bid from contractor(s); and/or
• Architectural drawings prepared demonstrating substantial remodeling is proposed.
5. A commitment letter will be issued verifying the reservation of funds to be provided at
closing.
6. If not pursuing a simultaneous closing, the homeowner will sign a mortgage and a
promissory note agreeing to the terms of the loan. The mortgage filing fee and
registration tax will be charge to the applicant. Following closing, work can begin on the
project.
7. If a simultaneous closing with end-financing has been requested by the Lender, the
homeowner may begin work once a commitment letter has been received, and building
permits issued.
Hold Harmless
To the fullest extent permitted by law, the Homeowner must agree to defend, indemnify and
hold harmless the HRA and the City of Richfield, their officers, agents and employees from
6
and against all claims, loss, damage, costs and expense arising from bodily or personal
injury or sickness, illness, or death of persons or damage to property resulting from or
alleged to have resulted from the Remodeler’s work and operations.
Remodeler Criteria
The Remodeler should meet a minimum set of standards and perform certain requirements
in order to participate in the program:
1. Meet any Lender requirements when the Homeowner is seeking Lender financing.
2. Provide adequate evidence of builder’s risk, comprehensive general liability and worker’s
compensation insurance coverage.
3. Provide a written warranty policy to the Homeowner and Lender.
4. Provide State Building/Remodeling Contractor license number.
5. Provide the following references:
• Five satisfied customers;
• Three major suppliers or subcontractors;
• Names of building officials from two cities where the Remodeler has worked in the
last three years.
Each Remodeler must fill out a Remodeler Form (Exhibit D).
Responsibility of Remodeler
The Remodeler must perform work in accordance with the specifications and contract
provided to the Homeowner. Any guarantee and/or warranties on the materials, supplies or
quality of work must be obtained by the Homeowner. Lien waivers must be provided at time
of payment. All property permits must be obtained per city code. NOTE: The City of
Richfield has a Point of Sale ordinance that requires all residential properties pass a housing
code inspection before sale. The HRA is not responsible for insuring compliance with this
ordinance. Proper inspections should be arranged by the seller and any repairs made as
part of the purchase/remodel process.
Housing and Site Development Criteria
The following requirements apply to all Transformation projects:
1. Each home shall be a detached single-family dwelling. Exceptions to this may be
approved by the HRA.
2. At a minimum, off-street paved parking must be provided on the site in accordance with
the zoning code.
7
3. Three and four bedroom homes as a result of remodeling are preferred. However, a
minimum of two finished bedrooms and space for a third bedroom that could be easily
finished will be acceptable.
4. Two full bathrooms as a result of remodeling are preferred. However, a minimum of one
full bath and a 1/2 bath roughed in will be acceptable.
5. House design and appearance is a critical concern to the HRA. The house building lines,
window placement, and orientation to street must present a balanced and pleasing view
from all sides. Garage door dominance in design must be minimized. Blank walls without
windows or doors are not allowed. Roof line variation will be reviewed.
6. If exterior work is included, exterior materials should be low maintenance. Masonite
siding materials are not acceptable.
7. All landscaping and sod disturbed by the construction project must be repaired in a
professional manner.
8. Adjoining properties must not be disturbed by the construction process.
9. Construction and the finished structure must improve or not have a detrimental impact on
storm water drainage patterns in the neighborhood and on adjoining properties. Where
roofs direct storm water toward minimum (five feet) side yards, gutters may be required
as a condition of Loan payment.
Design Plan Review
1. The HRA must be provided with a set of the building plans, including building elevations,
and a copy of the land survey or site plan.
2. HRA staff will review the plans to ensure conformance with the Housing and Site
Development Criteria. Plan review by the Building Official is a separate process.
3. All building plans must be prepared in consultation with an architect or a qualified
draftsperson.
4. If any element of the plan is in conflict with the above criteria, the Remodeler will be
notified.
5. Revised plans must be resubmitted for final approval.
6. All plan reviews will be completed by the HRA in a timely manner. Each plan submitted
will be processed individually.
7. The HRA may refer a set of plans to the County Assessor to make a preliminary
determination of value if there is concern about the extent of value added as a result of
remodeling.
8
Forms/Exhibits
A. Transformation Homes Application Form
B. Promissory Note
C. Mortgage Note
D. Remodeler Form
E. Summary of Costs and Loan Computation
F. Letter of Commitment
G. Sworn Construction Statement
H. Satisfaction of Mortgage
9
TRANSFORMATION HOME PROGRAM TRANSFORMATION HOME PROGRAM TRANSFORMATION HOME PROGRAM TRANSFORMATION HOME PROGRAM
APPLICATION COVER SHEET
APPLICANT CONTACT INFORMATION
Applicant(s) Legal Name(s) and Marital
Status
Applicant(s) current address
Applicant(s) phone number
Applicant(s) email address
REMODELING INFORMATION
Description of proposed improvements
Proposed Start Date
Estimated Completion Date
Name of architect or designer
Name of remodeler(s)
Remodeler phone number
FINANCING INFORMATION
Estimated amount of contract
Appraised value of property upon
completion (if lender-financed)
Lending Institution
Type of financing (second
mortgage/refinance/home equity line,
etc.)
Anticipated closing date
Source of financing, if not lender
financed
APPLICATION REQUIREMENTS:
Application cover sheet
$300 application fee
Photograph of the property and specific area to be remodeled (digital format)
Cost estimate
Building plans (both floor plans and exterior elevations) and site plan (if applicable)
Remodeler form with references
APPLICANT(S) SIGNATURE(S) I certify that the information I have provided is accurate and that I have read and
understand the program guidelines
Signature
Date
Signature
Date
10
EXHIBIT B
PROMISSORY NOTE PROMISSORY NOTE PROMISSORY NOTE PROMISSORY NOTE
1. FOR VALUE RECEIVED, the undersigned ("Borrower") agrees to pay to the
Housing and Redevelopment Authority in and for the City of Richfield, a body corporate and
politic under the laws of the State of Minnesota, ("Noteholder"), the sum of «Tl_Loan_Amt»
(the "Original Note Amount"), without interest, on the Maturity Date as hereinafter defined.
2. The Borrower acknowledges that the Original Note Amount is the amount loaned to
the Borrower by the Noteholder and is equal to 15 percent of the construction cost of the
home remodeling project undertaken by the Borrower and outlined in Exhibit B. The project
is located at «address» Richfield, Minnesota, which property is legally described as follows:
«LegalDesc»
(the "Subject Property").
3. The Maturity Date shall be the first date prior to the «maturidydate», 30 years from
the date of this Note, upon which any of the following events shall occur:
a) the Subject Property is voluntarily or involuntarily sold, transferred or otherwise
conveyed;
b) the Subject Property is rented, leased, unoccupied or assigned for a
period exceeding one year;
c) there exists any default under the terms of this or any other mortgage
secured by the Subject Property;
d) there exists any other event which would cause the Subject Property to
be occupied by other than the Borrower for a period of more than one year.
Notwithstanding anything else herein to the contrary, if there has been no event prior
to «maturidydate» which causes the occurrence of the Maturity Date, then the Borrower shall
thereafter be relieved of the obligation to repay the Original Note Amount, and the lien
hereby created shall be terminated.
4. The encumbrance evidenced by this Note in the Original Note Amount shall be
subordinate to any lien created and recorded prior to this Note.
5. In the event that the Borrower is notified directly or indirectly that foreclosure
proceedings, by advertisement, action or otherwise, have been commenced or will be
commenced, foreclosing any lien or liens against the Subject Property or any part thereof,
the Borrower shall immediately notify the Noteholder in writing of such proceedings.
11
6. Upon payment of this Note as provided herein, the Noteholder will, within 30 days
of written demand by the Borrower, execute a release and satisfaction or partial release and
partial satisfaction of this Note.
7. Presentment, protest and notice of dishonor are hereby waived by the Borrower.
The Borrower shall pay all costs incurred by the Noteholder hereof in the collection of this
Note, including reasonable attorney's fee.
8. To secure payment of this Note, the Borrower will execute a mortgage deed, a
copy of which is attached hereto as Exhibit A.
9. If the Noteholder requires the Borrower to pay in full and the Borrower refuses to
do so within the required period of time, the Borrower will be responsible for all costs incurred
by the Noteholder in enforcing this Note, including reasonable attorney's fees.
10. Any notice required to be given under this Note will be given if delivered by hand
or mailed by first class mail, postage prepaid to the Borrower's home address, or if to the
HRA, at 6700 Portland Avenue South, Richfield, MN 55423.
11. If there is more than one Borrower under this Note, each person shall be
considered a Borrower within the meaning of this Note and each shall be jointly and severally
responsible for payment under the Note.
Dated: ____________________________ BORROWER(S)
______________________________
______________________________
STATE OF MINNESOTA )
) SS
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this ____day of
______________, 20__ by
______________________________and______________________.
______________________________
Notary Public
This document drafted by:
The Housing and Redevelopment Authority
in and for the City of Richfield
6700 Portland Avenue South
Richfield, MN 55423
(612) 861-9760
12
EXHIBIT C
Mortgage Note
(Top 3 inches reserved for recording data)
MORTGAGE
by Individual(s)
MORTGAGE REGISTRY TAX DUE: $___________________ DATE: ____________________________
CHECK IF APPLICABLE: NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, ENFORCEMENT OF THIS MORTGAGE IN
MINNESOTA IS LIMITED TO A DEBT AMOUNT OF $[…] UNDER CHAPTER 287 OF MINNESOTA STATUTES.
THIS MORTGAGE (“ Mortgage ”) is given by «Legal_Names» , as mortgagor (“ Borrower ”), to the Housing and Redevelopment
Authority in and for the City of Richfield a public body corporate and politic under the laws of Minnesota as mortgagee
(“ Lender ”). In consideration of the receipt of twent Dollars ($ «Tl_Loan_Amt» ) (the “ Indebtedness ”) from Lender, Borrower hereby
mortgages, with power of sale, the real property in Hennepin County, Minnesota, legally described as follows:
«LegalDesc»
Check here if all or part of the described real property is Registered (Torrens) «Torrens»
together with all hereditaments and appurtenances belonging thereto (the “ Property ”), subject to the following exceptions:
(a) Covenants, conditions, restrictions (without effective forfeiture provisions) and declarations of record, if any;
(b) Reservations of minerals or mineral rights by the State of Minnesota, if any;
(c) Utility and drainage easements which do not interfere with present improvements;
(d) Applicable laws, ordinances, and regulations;
(e) The lien of real estate taxes and installments of special assessments not yet due and payable; and
(f) The following liens or encumbrances, if any:
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Borrower covenants with Lender as follows:
1. Repayment of Indebtedness. If Borrower (a) pays the Indebtedness to Lender according to the terms of the promissory
note or other instrument of even date herewith that evidences the Indebtedness and all renewals, extensions, and modifications thereto
(the “ Note ”), final payment of which is due on «maturidydate» ; (b) pays interest on the Indebtedness as provided in the Note; (c) repays
to Lender, at the times and with interest as specified, all sums advanced in protecting the lien of this Mortgage, if any; and (d) keeps and
performs all the covenants and agreements contained herein, then Borrower’s obligations under this Mortgage will be satisfied, and
Lender will deliver an executed satisfaction of this Mortgage to Borrower. It is Borrower’s responsibility to record any satisfaction of this
Mortgage at Borrower’s expense.
2. Statutory Covenants. Borrower makes and includes in this Mortgage the following covenants and provisions set forth in
Minn. Stat. 507.15, and the relevant statutory covenant equivalents contained therein are hereby incorporated by reference:
(a) To warrant the title to the Property;
(b) To pay the Indebtedness as herein provided;
(c) To pay all taxes;
(d) That the Property shall be kept in repair and no waste shall be committed;
(e) To pay principal and interest on prior mortgages (if any).
3. Additional Covenants and Agreements of Borrower. Borrower makes the following additional covenants and
agreements with Lender:
(a) Borrower shall keep all buildings, improvements, and fixtures now or later located on all or any part of the Property
(collectively, the “ Improvements ”) insured against loss by fire, lightning, and such other perils as are included in a standard all-
risk endorsement, and against loss or damage by all other risks and hazards covered by a standard extended coverage
insurance policy, including, without limitation, vandalism, malicious mischief, burglary, theft, and if applicable, steam boiler
explosion. Such insurance shall be in an amount no less than the full replacement cost of the Improvements, without deduction
for physical depreciation. If any of the Improvements are located in a federally designated flood prone area, and if flood
insurance is available for that area, Borrower shall procure and maintain flood insurance in amounts reasonably satisfactory to
Lender. Borrower shall procure and maintain liability insurance against claims for bodily injury, death, and property damage
occurring on or about the Property in amounts reasonably satisfactory to Lender and naming Lender as an additional insured,
all for the protection of the Lender.
(b) Each insurance policy required pursuant to Paragraph 3(a) must contain provisions in favor of Lender affording all
right and privileges customarily provided under the so-called standard mortgagee clause. Each policy must be issued by an
insurance company or companies licensed to do business in Minnesota and acceptable to Lender. Each policy must provide for
not less than ten (10) days written notice to Lender before cancellation, non-renewal, termination, or change in coverage.
Borrower will deliver to Lender a duplicate original or certificate of such insurance policies and of all renewals and modifications
of such policies.
(c) If the Property is damaged by fire or other casualty, Borrower must promptly give notice of such damage to Lender
and the insurance company. In such event, the insurance proceeds paid on account of such damage will be applied to
payment of the amounts owed by Borrower pursuant to the Note, even if such amounts are not otherwise then due, unless
Borrower is permitted to make an election as described in the next paragraph. Such amounts first will be applied to unpaid
accrued interest and next to the principal to be paid as provided in the Note in the inverse order of their maturity. Such
payment(s) will not postpone the due date of the installments to be paid pursuant to the Note or change the amount of such
installments. The balance of insurance proceeds, if any, will be the property of Borrower.
(d) Notwithstanding the provisions of Paragraph 3(c), and unless otherwise agreed by Borrower and Lender in writing, if
(i) Borrower is not in default under this Mortgage (or after Borrower has cured any such default); (ii) the mortgagees under any
prior mortgages do not require otherwise; and (iii) such damage does not exceed ten percent (10%) of the then assessed
market value of the Improvements, then Borrower may elect to have that portion of such insurance proceeds necessary to
repair, replace, or restore the damaged Property (the “Repairs ”) deposited in escrow with a bank or title insurance company
14
qualified to do business in Minnesota, or such other party as may be mutually agreeable to Lender and Borrower. The election
may only be made by written notice to Lender within sixty (60) days after the damage occurs; and the election will only be
permitted if the plans, specifications, and contracts for the Repairs are approved by Lender, which approval shall not be
unreasonably withheld, conditioned, or delayed. If such a permitted election is made by Borrower, Lender and Borrower shall
jointly deposit the insurance proceeds into escrow when paid. If such insurance proceeds are insufficient for the Repairs,
Borrower shall, before the commencement of the Repairs, deposit into such escrow sufficient additional money to insure the full
payment for the Repairs. Even if the insurance proceeds are unavailable or are insufficient to pay the cost of the Repairs,
Borrower shall at all times be responsible to pay the full cost of the Repairs. All escrowed funds shall be disbursed in
accordance with sound, generally accepted, construction disbursement procedures. The costs incurred or to be incurred on
account of such escrow shall be deposited by Borrower into such escrow before the commencement of the Repairs. Borrower
shall complete the Repairs as soon as reasonably possible and in a good and workmanlike manner, and in any event the
Repairs shall be completed by Borrower within one (1) year after the damage occurs. If, following the completion of and
payment for the Repairs, there remains any undisbursed escrow funds, such funds shall be applied to payment of the amounts
owed by Borrower under the Note in accordance with Paragraph 3(c).
(e) If all or any part of the Property is taken in condemnation proceedings instituted under power of eminent domain or is
conveyed in lieu thereof under threat of condemnation, the money paid pursuant to such condemnation or conveyance in lieu
thereof must be applied to payment of the amounts due by Borrower to Lender under the Note as set forth in Paragraph 3(c),
even if such amounts are not then due to be paid.
(f) Borrower will diligently complete all Improvements, if any, that may now or hereafter be under construction on the
Property.
(g) Borrower will pay all dues, fees, or assessments, if any, which are due and payable by Borrower to any homeowners
or similar association as a result of the Property’s inclusion therein.
(h) Borrower will pay any other expenses and attorneys’ fees incurred by Lender pursuant to the Note or as reasonably
required for the protection of the lien of this Mortgage.
4. Payment by Lender. If Borrower fails to pay any amounts to be paid hereunder to Lender or any third parties, or to insure
the Improvements, and deliver the policies as required herein, Lender may make such payments or secure such insurance. The sums so
paid shall be additional Indebtedness, bear interest from the date of such payment at the same rate set forth in the Note, be an additional
lien upon the Property, and be immediately due and payable upon written demand. This Mortgage secures the repayment of such
advances.
5. Default. In case of default (i) in the payment of sums to be paid under the Note or this Mortgage, when the same becomes
due, (ii) in any of the covenants set forth in this Mortgage, (iii) under the terms of the Note, or (iv) under any addendum attached to this
Mortgage, Lender may declare the unpaid balance of the Note and the interest accrued thereon, together with all sums advanced
hereunder, immediately due and payable without notice, and Borrower hereby authorizes and empowers Lender to foreclose this
Mortgage by judicial proceedings or to sell the Property at public auction and convey the same in fee simple in accordance with Minn.
Stat. Ch. 580, and out of the monies arising from such sale, to retain all sums secured hereby, with interest and all legal costs and
charges of such foreclosure and the maximum attorneys’ fees permitted by law, which costs, charges, and fees Borrower agrees to pay.
6. Residential Mortgages. Notwithstanding the provisions of Paragraph 5, if the Indebtedness is a “conventional loan” as
defined in Minn. Stat. 47.20, subd. 2(3), Borrower and Lender further covenant and agree as follows:
(a) Lender shall furnish to Borrower a conformed copy of the Note and this Mortgage at the time of execution or within a
reasonable time after recordation hereof.
(b) Upon default by Borrower of any covenant or agreement under the terms of this Mortgage, Lender shall give notice to
Borrower prior to foreclosure as provided in Paragraph 6(c) and such notice shall specify: (i) the nature of the default; (ii) the
action required to cure the default; (iii) a date, not less than thirty (30) days from the date the notice is mailed to Borrower, by
which the default must be cured; (iv) that failure to cure the default on or before the date specified in the notice may result in
acceleration of the sums secured by this Mortgage and sale of the Property; (v) that Borrower has the right to reinstate this
15
Mortgage after acceleration; and (vi) that Borrower has the right to bring a court action to assert the non-existence of the
default or any other defense of Borrower to acceleration and sale.
(c) In addition to any notice required under applicable law to be given in another manner, (i) any notice to Borrower
provided for in this Mortgage shall be addressed to Borrower and given by mailing the notice via certified mail to the Property
address (or to such other address as Borrower may designate by written notice to Lender as provided herein), and (ii) any
notice to Lender shall be given by mailing the notice via certified mail to the following address (or to such other address as
Lender may designate by written notice to Borrower as provided herein): Richfield Housing and Redevelopment Authority
6700 Portland Avenue South, Richfield, MN 55423
7. Governing Law; Severability. This Mortgage shall be governed by the laws of Minnesota. In the event that any provision
or clause of this Mortgage or the Note conflicts with applicable law, such conflict shall not affect other provisions of this Mortgage or the
Note which can be given effect without the conflicting provision.
8. Additional Terms. Check this box X if Minnesota Uniform Conveyancing Blank 20.2.1 or any other addendum (either
one or more) containing additional terms and conditions is attached to this Mortgage. If the foregoing box is not checked, then this
Mortgage shall not contain any such additional terms and conditions. The number of additional attached pages is Three (3) . Terms of
this Mortgage will run with the Property and bind the parties hereto and their successors in interest.
Borrower
Insert Printed name of Borrower:
Insert Printed name of Borrower:
State of Minnesota, County of Hennepin
This instrument was acknowledged before me on________________________________, by «Legal_Names»
(Stamp)
(signature of notarial officer)
Title (and Rank):
My commission expires:
(month/day/year)
THIS INSTRUMENT WAS DRAFTED BY:
The Housing and Redevelopment Authority in and for the City of
Richfield
6700 Portland Avenue South
Richfield, MN 55423
(612) 861-9760
16
EXHIBIT D
TRANSFORMATION HOME PROGRAM
REMODELER FORM
Business Name:____________________________________________________________
Phone No.:___________________ Fax No.: _____________________________________
E-mail Address: ____________________________________________________________
Business Address:__________________________________________________________
Contact Person: ___________________________________________________________
1. How many years has your company been in business? ______________
2. In the past three years, what has been the average number of homes your company
has remodeled per year? ______________________________________
3. In the past three years, what has been the average remodeling contract price by
your company? _____________________________________________
4. Attach copy of your company warranty policy.
If no written policy exists, please acknowledge that you comply with statutory
warranties.
Yes______________ No____________
5. You agree that you have the ability, at all times during the term of the Remodeling
Contract, to have and keep in force the following minimum insurance coverages:
COVERAGE: LIMITS:
Workers Compensation Statutory
Employer’s Liability $300,000 BI & PD
Comprehensive General Included
Independent Contractors Included
Products/Completed Included
Contractual Liability Included
Personal Injury Liability Included
“XCU” Liability (if applicable) Included
Broad Form Property Included
Comprehensive Automobile $300, 000 BI & PD
for owned, hired, and
automobiles
6. You meet Minnesota State licensing requirements. Yes ___ No ____
MN State Building/Remodeling Contractor License Number _____________
17
Please list municipalities in which you have secured remodeling permits within
the past 3-5 years and indicate the name of the City staff person (building
official or other) with whom you had the most contact.
1. ________________________________________________________
2. ________________________________________________________
3. ________________________________________________________
8. Provide names, addresses and telephone numbers of five customer references
that we may contact as references.
1. ________________________________________________________
2. ________________________________________________________
3. ________________________________________________________
4. ________________________________________________________
5. ________________________________________________________
9. Provide names, addresses and telephone number of three major suppliers or sub-
contractors that we may contact as references.
1. ________________________________________________________
2. ________________________________________________________
3. ________________________________________________________
The information contained on this form may be provided to lenders, homeowners, and
others interested in participating in Richfield Remodeling Programs.
By:_____________________________
Its: ____________________________
Date: __________________________
18
EXHIBIT E
SUMMARY OF CONSTRUCTION COSTS AND
TRANSFORMATION LOAN COMPUTATION
1) Address:
2) List of Improvements :
1.
2.
3.
4.
5.
3) Total Project Cost $
Total Eligible Costs $
4) (Total Eligible Cost) X (15%) = Loan Amount $
5) Date of Transformation Loan Approval: ___________
Check payable to:
19
EXHIBIT F
Date
«fullname»
«address»
Richfield, MN 55423
Subject: Letter of Commitment - «progname»
Dear «fullname»:
The Richfield Housing and Redevelopment Authority (HRA) has received your application for
a Transformation Homes Incentive Loan and other required information.
The application documents indicate that your project cost is $«Total_Project_Cost»;
therefore, the amount of your Transformation Homes Loan will be $«Tl_Loan_Amt» . This
loan will be a lien on your property. No interest will accrue on the loan, and the full amount
will be due and payable upon the future sale of your home or if you cease to live in the home
as your principal residence. If you own and live in your home for 30 years from the date of
the loan closing, the loan will be forgiven.
Please contact me at 612-861-9778 to schedule a time for you to come to City Hall to sign
the loan documents. It will take approximately 15 minutes. Please bring a picture ID and
«mortfee» to cover closing costs (mortgage filing fee and mortgage registration tax). Once
we have completed the loan closing, you may begin your project.
Sincerely,
Housing Specialist
«initials»:ttf
20
EXHIBIT G
SWORN CONSTRUCTION STATEMENT
STATE OF MINNESOTA )
)
COUNTY OF HENNEPIN )
The undersigned, hereinafter called "Contractor", being first duly sworn, as Contractor
improving the property having the following address in the State of Minnesota:
_________________________________________________________________________
_________________________________________________________________________
deposes and states that the following are the names of all parties who had or currently have
contracts or subcontracts with the Contractor, for specific portions of the work on said
property and building; or who had or currently have contracts or subcontracts with the
Contractor for materials or who have contributed materials at the Contractor's request
entering into the construction thereof; and that the items set forth below include all labor and
materials contracted by or obtained at the request of the Contractor required to complete the
work according to the specifications and drawings and the contract; that there are no other
contracts outstanding entered into by the Contractor or the Contractor's subcontractor(s).
LABORERS, MATERIAL SUPPLIERS OR
SUBCONTRACTORS RETAINED BY THE LABOR PROVIDED OR
CONTRACTOR ARE IDENTIFIED BELOW: MATERIALS SUPPLIED:
_____________________________________ ______________________________
_____________________________________ ______________________________
_____________________________________ ______________________________
_____________________________________ ______________________________
_____________________________________ ______________________________
_____________________________________
Name of Contracting Firm
_____________________________________
Authorized Signature and Title
Subscribed and sworn before me, this ______ day of ___________________ 200___.
Notary Public ________________________
21
FAILURE TO INCLUDE ALL SUBCONTRACTORS AND MATERIAL SUPPLIERS IN THIS
DOCUMENT COULD RESULT IN LEGAL ACTION BEING TAKEN AGAINST THE
CONTRACTOR.
22
EXHIBIT H
Date:
Satisfaction Of Mortgage
THAT CERTAIN MORTGAGE owned by the undersigned, dated ______________ executed by
_______________________, Mortgagor to Housing and Redevelopment Authority in and for the City of
Richfield, as Mortgagee, and filed for record ________________ as Document Number ____________ in
the Office of the County Recorder of ____________ County, Minnesota, is with the indebtedness thereby
secured, fully paid and satisfied.
Housing and Redevelopment Authority
in and for the City of Richfield
By
Its Chairperson
By
Its Executive Director
23
NOTARIAL STAMP OR SEAL
NOTARIAL STAMP OR SEAL
STATE OF MINNESOTA
COUNTY OF HENNEPIN
}
)
ss.:
The following instrument was acknowledged before me this ________ day of__________,
20___, by___________, the Chairperson, of the Housing and Redevelopment Authority in and for the
City of Richfield, Minnesota, a public body corporate and politic under the laws of Minnesota, on
behalf of the HRA.
SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT
STATE OF MINNESOTA
COUNTY OF HENNEPIN
}
)
ss.:
The following instrument was acknowledged before me this ________ day of __________,
20___, by___________, the Executive Director, of the Housing and Redevelopment Authority in and
for the City of Richfield, Minnesota, a public body corporate and politic under the laws of Minnesota,
on behalf of the HRA.
SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT
This document drafted by:
Kennedy & Graven, Chartered
470 Pillsbury Center
Minneapolis, MN 55402
R:Cdadmin:Housing:Transformation Homes Guideline
AGENDA SECTION:Consent Calendar
AGENDA ITEM #3.C.
STAFF REPORT NO. 11
HOUSING AND REDEVELOPMENT AUT HORIT Y
MEET ING
3/20/2017
REPORT PREPARED BY: Julie Urban, Housing Specialist
DEPARTMENT D IRECTOR REVIEW: John Stark, C ommunity Development Director
2/14/2017
OTHER DEPARTMENT REVIEW: N/A
CITY MANAGER REVIEW: Steven L. Devich, Executive Director
2/15/2017
IT EM FOR COUNCIL CONSIDERAT ION:
Consideration of the approval of revisions to the Richfield Rediscovered Lot Sale Guidelines and the
Redevelopment Cr edit Program Guidelines.
EXECUT IVE SUM M ARY:
The Ric hfield Rediscovered Lot Sale Program (Lot Sale Program) sells lots to builder/buyer teams for the
development of newly c onstruc ted homes. The Ric hfield Redisc overed Credit Program (Credit Program)
contributes $50,000 towards the private development of a newly constructed homes. The Lot Sale Program
and Credit Program guidelines are tools for administering these programs. Staff periodically reviews these
Guidelines and rec ommends c hanges as appropriate.
The following changes to the Lot Sale Program Guidelines are recommended:
1. Limit a home buy er, and his/her household, to building no more than one home every seven years.
2. Establish an optional Request for Proposals process for selling a lot.
3. Eliminate the additional subsidy offered for installing sound attenuation requirements and replace it with
a reduced lot sale price.
The following changes to the Credit Program Guidelines are rec ommended:
1. Limit a home buy er, and his/her household, to rec eiving no more than one Redevelopment Credit every
seven years.
RECOM MENDED ACT ION:
By Motion: Appr ove the recommended revisions to the Richfield Rediscover ed Lot Sale Program
Guidelines and to the Richfield Rediscover ed Credit Program Guidelines.
BASIS OF RECOM M ENDAT ION:
A.HISTORICAL CONTEXT
There is c urrently no limit to how many times a home buyer can utilize either of the Ric hfield
Rediscovered programs. By restric ting the number of times an individual home buy er, and anyone
in his/her household, can purchase a lot or receive an Redevelopment Credit, the HRA limits the
potential for an individual to use the Program for financial gain.
Rec ently, some of the available lots have generated significant interest. In order to best manage
that interest and obtain the best possible proposal for a lot, staff recommends using a Request for
Proposals process through which builder/buy er teams have a defined period of time in which to
submit an application. Staff then evaluates all proposals submitted by the deadline and selects the
highest ranking applic ation. The HRA Attorney rec ommended adding a description of this process
to the Guidelines.
New c onstruc tion loc ated within defined airport-impact areas are required to build to higher sound
attenuation standards. Because these higher standards add signific antly to the cost, the HRA
offered to reimburse builders for a portion of the increased cost. Staff has determined that it is
more efficient to reduc e lot prices to reflect this inc reased c ost rather than offer reimbursement.
B.POLICIES (resolutions, ordinances, regulations, statutes, etc):
The primary objectives of the Programs are to remove substandard houses and replace them with
new, higher-valued, move-up housing.
C.CRITICAL TIMING ISSUES:
None
D.FINANCIAL IMPACT:
The proposed revisions have no financial impac t on the Program.
E.LEGAL CONSIDERATION:
The HRA Attorney provided feedbac k on the proposed revisions.
ALTERNATIVE RECOMMENDATION(S):
The HRA may c hoose not to approve the revisions to the Guidelines.
PRINCIPAL PARTIES EXPECTED AT MEETING:
N/A
ATTACHMENTS:
Description Type
Lot Sale Program Guidelines 2017 Backup Materi al
Credit Program Guidelines 2017 Backup Materi al
RICHFIELD REDISCOVERED
PROGRAM GUIDELINES
LOT SALE PROGRAM
REVISED: March 20, 2017
2
PROGRAM OBJECTIVES ............................................................................................................................ 3
DEFINITIONS ............................................................................................................................................... 3
PROGRAM BASICS ..................................................................................................................................... 4
APPLICATION REQUIREMENTS ................................................................................................................ 4
ADDITIONAL REQUIREMENTS .................................................................................................................. 5
HOUSE DESIGN AND SITE DEVELOPMENT REQUIREMENTS .............................................................. 6
New House Standards ............................................................................................................................ 6
Site Standards ......................................................................................................................................... 6
Construction Requirements .................................................................................................................. 7
General Standards .................................................................................................................................. 7
Green Community Concepts ................................................................................................................. 8
CITY REVIEW PROCEDURE ....................................................................................................................... 8
LOT SALE TO BUILDER/BUYER ................................................................................................................ 9
PROGRAM MARKETING ........................................................................................................................... 10
DATA PRIVACY ......................................................................................................................................... 10
3
This document has been developed as a guidance tool for program administration. It should not be
interpreted as constituting any contractual agreement or liability by the City or Housing and
Redevelopment Authority (HRA). The HRA may modify or divert from the guidelines where it deems
appropriate.
I. Program Objectives
1. To remove substandard, functionally obsolete housing on scattered sites throughout the City
and replace with new, higher-valued housing.
2. To eliminate the blighting influence of substandard housing, thus improving residential
neighborhoods.
3. To alleviate the shortage of housing choices for families.
4. To facilitate the construction of larger three- to four-bedroom, owner-occupied homes
designed for families.
5. To facilitate the construction of multi-unit, owner-occupied homes designed to expand family
opportunities or to serve elderly residents.
These objectives will be achieved through the sale of lots by the Housing and Redevelopment Authority to
Builder/Buyer teams for the development of newly constructed homes.
II. Definitions
Applicant: An individual who submits an application for a Richfield Rediscovered lot. The Applicant may
be a Builder or the end Buyer. If the Applicant is a Builder, an end Buyer should be identified. If the
Applicant is the Buyer, the Applicant must submit a signed contract between the Builder and the Buyer to
build a home on the lot identified in the application.
Buyer : An individual(s) who will build, own and occupy a new housing unit in Richfield.
The Buyer will occupy the property and not offer it for rent. The Buyer may not also function as the
Builder on a Richfield Rediscovered project. The Buyer and Builder must be unrelated separate legal
entities. A speculative project by a Buyer may be considered if all other program requirements can be
met. However, neither the Buyer, the Buyer’s Builder or Builder’s subcontractors, or the Builder’s realty
agents may occupy or purchase the property.
Buyers, unless licensed in the trade specified, may not put any sweat equity into the construction of the
foundation, wall/roof framing, shingling, exterior work, electrical/plumbing/HVAC systems or interior
carpentry.
A Buyer, and all members of his/her household, is limited to building a home through the program no
more than once every seven years.
Builder : Licensed Contractor who has signed a contract with the Buyer to build a home on the lot
identified in the application.
Contract for Private Development : A contract between the HRA and the Builder or Buyer that establishes
the conditions under which the lot will be sold and the proposed house will be developed.
Green Community Concepts Plan: A written plan indicating how the proposed developm ent will
incorporate green building features and concepts. Priority will be given to projects that incorporate green
building features.
HRA : Housing and Redevelopment Authority in and for the City of Richfield.
4
Lot List : A listing of available lots for sale. Information regarding the lot location, size and sale price is
provided.
III. Program Basics
1. HRA publishes a list of available vacant lots for purchase including sale price and
development criteria.
2. Builder/Buyer team proposes a plan for a lot consistent with development criteria and
program requirements and makes an offer to purchase.
3. HRA may issue a Request for Proposals for a specific lot(s) with a specific submittal
deadline. HRA staff review all Proposals submitted by the deadline for consistency with
development criteria and program requirements. The Proposal that best meets the criteria
and requirements is selected to develop the lot.
4. HRA approves lot sale.
5. Lot is sold to Builder or Buyer.
6. Builder constructs new home.
7. Projects must be completed within one year of HRA approval of the project.
IV. Application Requirements
The following must be submitted for application to the program:
1. $525 application fee
An application fee must be paid at the time of application. This fee is non-refundable and
is not part of the lot price.
2. Application Form
3. Floor plans
The layout of all levels, including basement and unfinished space, must be provided.
4. Elevations
Elevations of all four sides of the house, including view of garage shall be provided.
Colored renderings may also be required.
5. Site plan
The site plan shall indicate the location of the new house, walkways and garage.
6. Landscaping plan
A landscaping plan must indicate the location and type of trees, shrubbery, flowers and
landscaping materials (e.g. rocks, mulch) and any existing trees to be preserved.
7. Detail of construction materials to be used on the project.
8. Green Community Concepts Plan
The plan should indicate what Green Community Concepts will be incorporated into the
project.
9. Construction timeline
Construction must be completed with one year of the purchase of the property.
10. Signed contract with Builder
5
11. Purchase agreement
If the Builder plans to purchase the lot, the application must include a valid purchase
agreement between the Buyer and the Builder for the lot to be developed.
12. Financial capability statement
A statement from a financial institution indicating willingness to provide sufficient
construction capital to complete the project must be provided.
13. Builder References
a. Five previous customers
b. Three major suppliers, one being the construction supplier
c. Building inspectors from two cities where the Builder has constructed new housing
within the past three years
14. Proof of Builder’s Comprehensive General Liability with Property Damage Protection.
15. Proof of sufficient worker’s compensation insurance coverage by the Builder.
16. Written warranty program
To be provided to the Buyer, which guarantees at a minimum, warranted repairs as
required by Minnesota State Statute.
V. Additional Program Requirements
1. The Applicant is expected to meet with an architectural/design consultant prior to submitting an
application. A two-hour consultation is available through the HRA at a cost of $25 to the
applicant. See the City’s website ( www.cityofrichfield.org ) for more information. This requirement
may be waived if the applicant is using an architect for the project.
2. The site will be sold to the Builder or Buyer at the fair market value as appears on the Lot List.
The HRA will not accept offers for less than the established sale price.
3. A Contract for Private Development is signed by the HRA and the Builder or the Buyer. The
Contract is a standard form which includes conditions for acquisition and development of the
property. The Contract will establish a minimum required end-value for the property based on
construction estimates provided by the applicant. The Builder or Buyer will be expected to agree
to the terms of the Contract before the application can be scheduled on the HRA agenda.
4. The lot can be sold to either the Builder or the Buyer. If the lot is sold to the Builder, the Builder
will pay cash for the lot at closing and submit a Letter of Credit or cash escrow for $10,000. The
Letter of Credit must be from a financial institution incorporated in the Twin Cities metropolitan
area. The cash escrow will be held in a non-interest bearing account. The Letter of Credit or
cash escrow will be released once the construction and landscape work are completed and a final
Certificate of Occupancy is issued.
5. If the lot is sold to the Builder and the Builder fails to complete construction as approved by the
HRA, the Letter of Credit or cash escrow may be drawn upon by the HRA. In addition, the
Contract for Private Development will contain a reverter provision, which will enable the HRA to
reclaim ownership of the property in the event of a default in the Contract. In the event that the
Builder fails to complete construction, the HRA may exercise its rights under the reverter
provision, as well as draw upon the Letter of Credit or cash escrow.
6. If the lot is sold to the Buyer, the Buyer will pay cash for the lot at closing and a $10,000
mortgage in favor of the HRA will be filed on the property. The mortgage will be in first position.
The HRA may consider subordinating its interest in appropriate cases.
6
7. If the lot is sold to the Buyer and the Buyer fails to complete construction as approved by the
HRA, the HRA may exercise its rights provided in the mortgage.
8. A Buyer, and all members of his/her household, is limited to purchasing no more than one lot
every seven years.
VI. House Design and Site Development Requirements
The development of all sites shall meet the development criteria listed below, as reviewed and approved
by the HRA. To maximize the development of a given lot, the HRA reserves the right to explore all
development options without obligating the HRA to support any specific proposal, idea or solicitation.
Housing design is a critical element of the program. Siding materials, exterior façade presentation, roof,
window, siding and building line variability, finished landscape, interior space function and use are all
important issues of design to the HRA. The design requirements were created to ensure that the homes
built on the HRA-sold lots blend in with the surrounding neighborhood and respond to the specific
concerns of the HRA.
All new houses built under the Richfield Rediscovered Program must meet the requirements of the City’s
Zoning Code and additional criteria, as listed in this document.
A. New House Standards
1. New dwelling must be owner-occupied.
2. Three finished bedrooms are required, at a minim um.
3. Two finished bathrooms are required, at a minimum.
4. Two-car garage is required, at a minimum.
5. A full basement is required, unless the selected design results in a split-level or a garden-level
type of basement. In the case of an “accessible” house, a basement may be omitted if it would
otherwise prohibit accessible design elements.
B. Site Standards
1. After construction, the site must be fully landscaped, including plantings around the foundation.
The entire grounds shall be landscaped and be aesthetically pleasing in all seasons. Land
forms and plant materials shall be used to define the site and blend neatly with adjoining
properties. Specific lot line blending requirements may be required, as appropriate, for specific
sites.
At a minimum, the applicant must meet the “Landscaping and Screening Requirements” in the
City’s Zoning Code under Section 544.03, Subd. 4, General landscaping requirements and
Subd. 5, Residential sites. The code is available on the City’s website:
http://www.ci.richfield.mn.us
To the greatest extent possible, existing trees should be preserved. Any trees removed must be
replaced (they do not have to be the same species or in the same location) and should be
labeled on the required landscape plan.
2. Utility meters shall be screened from street view and locations must be specified on plans.
7
3. Site drainage should be accommodated on the site so that water is directed away from the new
home and the neighboring properties. Neighboring properties must not be disturbed by the
creation of drainage swales. Specific storm water management requirements may be required,
as appropriate, including the addition of gutters or on-site management for specific sites.
Construction and the finished structure must not have a detrimental impact on storm water
drainage patterns in the neighborhood.
4. All air conditioning units must be located in the rear yard of the house, or as approved by the
HRA.
C. Construction Requirements
1. Existing trees identified on the landscape plan as being preserved, must be protected during
construction. A tree wrap with board reinforcements shall be used on trees directly adjacent to
active grading and construction areas. Damaged or destroyed trees must be replaced.
2. The construction site, neighboring properties and adjacent public streets shall be kept free of
construction debris at all times.
3. No construction workers, construction equipment or construction material shall encroach upon
neighboring properties.
4. The property shall have a new sanitary service line installed to the City sanitary sewer main
consisting of schedule 40 PVC or equivalent. If there is an existing 6" sewer stub at the property
line, it must be lined with 4" schedule 40 PVC or equivalent to the City’s sanitary main, and it
must include a "donut" at the end with cement.
The line must be televised after installation to ensure the following:
1. There are no obstructions in the line.
2. The PVC liner is not protruding into the City’s sanitary sewer main line.
D. General Standards
1. The value of the new home must meet or exceed the minimum value specified in the Contract for
Private Redevelopment.
2. All homes in the Richfield Rediscovered Program must be stick-built or high-quality modular, new
construction.
3. Exterior materials (siding, soffit, doors and windows) should be low-maintenance and durable.
Brick, aluminum, vinyl and fiber cement siding are preferred. Natural cedar lap is acceptable if
properly stained or painted. Hardboard panels or hardboard lap siding are prohibited. Roof
valleys must have metal valleys and not be woven.
4. Unit height and mass of the new house shall be compatible with the scale of the surrounding
homes in the neighborhood.
5. Plans must present a balanced and pleasing distribution of wall, door and window areas from all
views.
6. The dominance of the garage door must be minimized through placement, architectural detail,
door design and utilization and design of windows. Garages, where the garage door faces the
street, shall not be located closer to the front lot line than the foremost facade of the principal
8
building facing the front property line. Garage sidewalls that face the street should appear to
contain habitable space. This can be accomplished by incorporating windows and other design
elements into the garage wall that are in character with the remainder of the dwelling. For lots
that have alley access, the garage should be oriented to access the alley.
7. All building plans must have been prepared in consultation with an architect or qualified
draftsperson. All requirements by the Building Inspections Division must be met.
8. All Richfield Rediscovered houses must meet or exceed Minnesota Energy Code requirements.
9. All new homes shall be built to provide high quality sound insulation. Recommendations for sound
insulation measures may be provided on a site-by-site basis. All construction must conform to
sound attenuation building standards as required by Zoning Ordinance Section 541.19 for
properties located within the 2007 60-62 DNL Contour and 2007 63 or greater DNL contours.
9. If a variance is required to construct the proposed development, the HRA may, at its sole
discretion, choose to reject the application.
10. If the HRA accepts an application that needs a variance(s), sale of the property will be contingent
upon the applicant obtaining the necessary variance(s). The Applicant is responsible for applying
for the variance(s) at its own expense. The HRA, as owner of the property, will, however,
cooperate with the application.
E. Green Community Concepts
Priority will be given to projects incorporating the green community concepts listed below. Any
concepts the applicant would like considered during the application process should be explained
in a written plan submitted with the application. A $5,000 rebate will be provided to the Applicant
for projects that obtain certification through LEED for Homes, Minnesota GreenStar or Minnesota
Green Communities.
1. Protect and conserve water and soil. To reduce water consumption, consider the use of water-
conserving appliances, fixtures, and landscaping. Steps should be taken to minimize the loss of
soil and sediment during construction and occupancy to reduce storm-water sediment and air
pollution.
2. Minimize energy consumption. Reduce energy consumption by taking advantage of natural
heating, cooling and day lighting, and by using energy-efficient appliances, equipment and
lighting.
3. Enhance indoor environmental quality. Use non-toxic materials, ventilation and exhaust systems,
and moisture control products and systems.
4. Use environmentally-preferable materials and resources. Use locally-produced, salvaged and/or
manufactured materials, products with recycled content or from renewable sources, recyclable or
reusable materials, and low-VOC-emitting materials.
5. Reduce waste . Reduce and manage wastes generated during the construction process and
operation of buildings. If demolition occurs, sort and recycle leftover materials and debris.
VII. City Review Procedure
1. Applicant reviews proposed project with HRA staff before plans are finalized.
9
2. Applicant submits application, plans, and application fee at least 45 days prior to the HRA
meeting.
3. An application is considered to be received when delivered personally to HRA staff in a pre-
arranged meeting. If more than one application is submitted for a lot within five-working days, all
applications will be reviewed, and the application that best meets the program guidelines will be
selected. The application fee will be returned to the Applicant whose proposal was not
selected.Following this five-day period, the lot will be considered reserved by the selected
application and no additional applications will be accepted for the proposed lot while the
application is being processed.
4. If an application is determined to be incomplete, the applicant will have 30 days to submit a
complete application. If a complete application is not received within 30 days, the application will
be rejected and the lot will be made available for new applications.
5. HRA staff review application to ensure conformance with House Design and Site Development
Requirements.
6. HRA staff may reject or accept an application at its sole discretion.
7. HRA staff may choose to issue a Request for Proposals (RFP) for a lot. In this case, Staff issues
an RFP, giving a specific time period within which proposals may be submitted. HRA staff review
all proposals for consistency with development criteria and program requirements. The proposal
that best meets the criteria and requirements is selected to develop the lot. The applicant will
have 30 days to submit a complete application. If a complete application is not received within 30
days, the application will be rejected. Staff may elect to award the lot to another submitted
proposal or solicit additional proposals.
8. The Builder or Buyer executes a Contract for Private Redevelopment.
9. An application is determined to be complete at least three weeks prior to the HRA meeting.
10. HRA staff publishes a legal notice of the public hearing and prepares a report and
recommendation for the HRA.
11. HRA reviews application, conducts a public hearing, and takes action at the HRA meeting.
12. If approved, the Contract for Private Redevelopment is executed by the HRA.
VIII. Lot Sale to Builder or Buyer
1. Upon approval of the application by the HRA, a closing will be scheduled between the HRA and
the Builder or Buyer.
2. The HRA will prepare all statements, affidavits, documents, and general release forms required
for closing.
3. The Builder applies for a building permit prior to closing. The Builder is responsible for acquiring
the necessary building permits with the City of Richfield Building Inspections Division. If changes
to the plans are required by the Inspections Division, the applicant must notify HRA staff.
4. The Applicant provides evidence to HRA staff that all requirements to proceed with construction,
as determined in the Contract for Private Redevelopment, have been met.
10
5. The HRA conveys the property to the Builder or Buyer by Quit Claim Deed. The site will be sold
to the Builder or Buyer at the fair market value as appears on the Lot List.
6. At closing with the Builder, the Builder provides a Letter of Credit or cash escrow for $10,000 to
the HRA.
7. At closing with the Buyer, the Buyer signs a mortgage and promissory note for $10,000 in favor of
the HRA.
8. Upon completion of the project, the Letter of Credit or cash escrow is released to the Builder or
the Buyer’s mortgage is released. A Certificate of Completion is executed by the HRA, releasing
the obligations of the Contract for Private Redevelopment.
IX. Program Marketing
Richfield Rediscovered program marketing is entirely at the discretion of the HRA. It may include the
following:
1. Buyer Solicitation . The HRA may market the program to potential Buyers through promotional
articles, direct mail, the Internet, or other methods as deemed appropriate. Buyers may be any
financially capable individual or household, including first-time buyers, move-up buyers or empty-
nesters.
2. Public Promotion .
a. The HRA will periodically provide information about the program through articles in city
publications, on the City’s web site, on the Community Cable channel, or via press
releases to promote community awareness.
b. A public open house may be held to provide an opportunity for residents and other
interested parties to collectively view the finished homes. The Parade of Homes Fall
Showcase and Spring Preview may also accomplish this.
c. Photos will be taken of finished homes and may be used to promote the program.
A program information package will be mailed to all interested participants. The information packet m ay
include the following:
1. Lot List
2. Richfield Rediscovered Lot Sale Procedural Guidelines
3. Application Form
4. Sample Contract for Private Redevelopment
X. Data Privacy
The HRA is subject to Minnesota Statutes Chapter 13 (the “Minnesota Government Data Practices Act”).
Under the Minnesota Government Data Practices Act, the names and addresses of applicants for or
recipients of assistance under this program and the amount of assistance received under this program
are public data. All other financial information submitted to the HRA for purposes of the program
application is considered private data.
RICHFIELD REDISCOVERED
PROCEDURAL GUIDELINES
REDEVELOPMENT CREDIT PROGRAM
Revised: March 20, 2017
2
PROGRAM OBJECTIVES ............................................................................................................................ 3
DEFINITIONS ............................................................................................................................................... 3
PROGRAM BASICS ..................................................................................................................................... 3
APPLICATION REQUIREMENTS ................................................................................................................ 4
SECURING A SITE ....................................................................................................................................... 5
PROPERTY EVALUATION CONSIDERATIONS AND PROCEDURES ..................................................... 5
HOUSE DESIGN AND SITE DEVELOPMENT REQUIREMENTS .............................................................. 6
NEW HOME STANDARDS .......................................................................................................................... 6
SITE STANDARDS ....................................................................................................................................... 6
CONSTRUCTION REQUIREMENTS ........................................................................................................... 7
GENERAL STANDARDS ............................................................................................................................. 7
GREEN COMMUNITY CONCEPTS ............................................................................................................. 8
DISBURSEMENT OF FUNDS ...................................................................................................................... 9
SOLICITATION OF NEW DEVELOPMENT PROPOSALS ......................................................................... 9
GENERAL PROGRAM MARKETING ........................................................................................................ 10
DATA PRIVACY ......................................................................................................................................... 10
3
This document has been developed as a guidance tool for program administration. It should not be
interpreted as constituting any contractual agreement or liability by the City or Housing and
Redevelopment Authority (HRA).
I. Program Objectives
• To remove substandard, functionally obsolete housing on scattered sites throughout the
city with new, higher-valued housing
• To eliminate the blighting influence of substandard housing, thus improving residential
neighborhoods.
• To alleviate the shortage of housing choices for families.
• To facilitate “Market Rate Initiatives” which include:
o Larger three- to four-bedroom, owner-occupied homes designed for families
These objectives will be achieved through the acquisition of property by private Buyers and the
development of newly constructed homes.
II. Definitions
Buyer : An individual(s) who will build, own and occupy a new single-family home in Richfield.
The Buyer will occupy the property and not offer it for rent. The Buyer may not also function as the
Builder on a Richfield Rediscovered project. The Buyer and Builder must be unrelated separate legal
entities. A speculative project by a Buyer may be considered if all other program requirements can be
met. However, neither the Buyer, the Buyer’s Builder or Builder’s subcontractors, or the Builder’s realty
agents may occupy or purchase the property.
Buyers, unless licensed in the trade specified, may not put any sweat equity into the construction of the
foundation, wall/roof framing, shingling, exterior work, electrical/plumbing/HVAC systems or interior
carpentry.
A Buyer, and all members of his/her household, is limited to building a home through the program no
more than once every seven years.
Builder : Contractor who has signed contract with the Buyer to build a single-family home on the lot
identified in the application.
Contract for Private Development : A contract between the HRA and the Buyer or Builder that establishes
the conditions under which the lot will be sold and the proposed house will be developed.
Green Community Concepts Plan : A written plan indicating how the proposed development will
incorporate green building features and concepts. Priority will be given to projects that incorporate green
building features.
HRA : Housing and Redevelopment Authority in and for the City of Richfield.
Seller : Owner of property identified as eligible by the HRA based on condition, size and marketability.
Redevelopment Credit : To offset costs of acquisition and demolition, a redevelopment credit of $50,000 is
available from the HRA for a Buyer who acquires the property directly from the seller for redevelopment.
III. Program Basics
• Program is first-come, first-serve, subject to funding availability.
4
• Buyer purchases property, hires builder to demolish existing structures and constructs a
new single-family home in conformance with program requirements.
• A $50,000 Redevelopment Credit is available per completed property.
• Projects must be completed within one year of HRA approval of the project.
• A Buyer, and all members of his/her household, is only eligible to receive a
Redevelopment Credit once every seven years
IV. Application Requirements
The following must be submitted for application to the program:
1. $525 application fee
An application fee, in the form of a certified cashier’s check made out to the Richfield
HRA, must be paid at the time of application. This fee is non-refundable and is not part
of the lot price.
2. Project Information Sheet
3. Purchase agreement
The Buyer must present a valid purchase agreement for the lot it proposes to redevelop.
The closing must be scheduled after the date of the HRA meeting.
4. Blueprints
The layout of all levels, including basement and unfinished space, must be provided.
5. Elevations
Elevations of all four sides of the house, including view of garage shall be provided.
6. Site plan
The site plan shall indicate the location of the new house, walkways and garage.
7. Landscaping plan
A landscaping plan may be hand-drawn by the applicants, but must indicate the location
and type of trees, shrubbery, flowers and landscaping materials (e.g. rocks, mulch). The
entire grounds shall be landscaped and be aesthetically pleasing in all seasons. Land
forms and plant materials shall be used to define the site and blend neatly with adjoining
properties. Specific lot line blending requirements may be required, as appropriate, for
specific sites.
8. Green Community Concepts Plan
The plan should indicate what Green Community Concepts will be incorporated into the
project.
9. Detail of construction materials to be used on the project.
10. Construction timeline
Construction must be completed with one year of the purchase of the property.
11. Signed contract with Builder
12. Financial capability statement
a. A statement from a financial institution indicating willingness, with standard
contingencies, to provide sufficient construction capital to complete the project.
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13. Builder References
a. Five previous customers
b. Three major suppliers, one being the construction supplier
c. Building inspectors from two cities where the Builder has constructed new housing within
the past three years
14. Proof of Builder’s Comprehensive General Liability with Property Damage Protection.
15. Proof of sufficient worker’s compensation insurance coverage by the Builder.
16. Written warranty program
a. To be provided to the Buyer, which guarantees at a minimum, warranted repairs as
required by Minnesota State Statute.
V. Securing a Site
Participants identify a property on their own or from a list of Richfield Rediscovered-eligible properties
provided by HRA staff. If the property has not already been qualified for the program, it must be
evaluated for substandardness or market obsolescence. Upon request of a prospective Buyer, HRA staff
may research the property, and arrange for a “Substandard Evaluation” to be conducted. An evaluator
will inspect the interior for substandard qualification.
The Buyer is responsible for negotiating with the Seller on a purchase price. Once a purchase agreement
between the Seller and Buyer has been signed, the Buyer should submit an application form and required
supporting documents. Only when HRA staff has received a complete application, can the $50,000
Redevelopment Credit be reserved. The reservation of funds is not an approval by the HRA. All
applications must be brought to the HRA at a regularly-scheduled meeting for approval.
VI. Property Evaluation Considerations and Procedures
Properties with the lowest market values, poorest visibility, and/or a history of code violations, will be
considered first for the program.
To be eligible for the Richfield Rediscovered program, a house must be structurally substandard and
meet at least of one of the criteria in Criteria A and all of Criteria B .
Criteria A
• Obsolete design for block and area in which it is located.
• Deteriorated to the point that it has caused blight to other adjoining properties.
• Detrimental to the health or safety of abutting properties.
• Less than $140,000 in value, as determined by the City of Richfield Assessing
Department.
Criteria B
• Site can be developed with a new home within city code requirements, including
conformance with the Zoning Code and the Comprehensive Plan
• Property does not cause negative impact on other redevelopment projects.
Redevelopment projects may include:
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o Established commercial redevelopment areas
o Right-of-way improvement projects such as I-494, I-35W, Crosstown Highway
62, , TH 77 and 66 th Street
o Negative airport noise zones
o Stormwater/flood prevention improvement projects
o Other, as determined by the HRA
At the request of an interested Buyer, staff will research the property and if it is believed that the property
may qualify for the Richfield Rediscovered program, a “Substandard Evaluation” will be arranged. An
evaluator will inspect the interior for substandard qualification.
If a property meets the substandard test during the independent “Substandard Evaluation”, application
procedures can continue. If the substandard test cannot be met, the property cannot be considered for
the Richfield Rediscovered program.
At the discretion of staff, properties over 50 years old may also be required to be evaluated for historical
significance through the Minnesota Historical Society.
VII. House Design and Site Development Requirements
Housing design is a critical element of the program. Siding materials, exterior façade presentation, roof,
window, siding and building line variability, finished landscape, interior space function and use are all
important issues of design to the HRA. The criteria were created to ensure that the homes built on the
identified lots blend in with the surrounding neighborhood and respond to the specific concerns of the
HRA.
All new houses built under the Richfield Rediscovered Program must meet the requirements of the City’s
Zoning Code and additional criteria, as listed in this document.
The development of all sites shall meet the development criteria listed below, as reviewed and approved
by the HRA. To maximize the development of a given lot, the HRA reserves the right to explore all
development options without obligating the HRA to support any specific proposal, idea or solicitation.
A. New Home Standards
1. Existing buildings must be demolished. If an existing garage is in good condition, it may be
retained upon review by HRA staff and the Building Official.
2. New dwelling must be owner-occupied and single-family.
3. Three finished bedrooms are required.
4. Two finished bathrooms are required.
5. Two-car garage is required.
6. A full basement is required, unless the selected design results in a split-level or a garden-level
type of basement. In the case of an “accessible” house, a basement may be omitted if it would
otherwise prohibit accessible design elements.
B. Site Standards
1. After construction, the site must be fully landscaped, including plantings around the foundation.
The entire grounds shall be landscaped and be aesthetically pleasing in all seasons. Land
forms and plant materials shall be used to define the site and blend neatly with adjoining
properties. Specific lot line blending requirements may be required, as appropriate, for specific
sites.
At a minimum, the applicant must meet the “Landscaping and Screening Requirements” in the
City’s Zoning Code under Section 544.03, Subd. 4, General landscaping requirements and
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Subd. 5, Residential sites. The code is available on the City’s website:
http://www.cityofrichfield.org.
To the greatest extent possible, existing trees should be preserved. Any trees removed must be
replaced (they do not have to be the same species or in the same location) and should be
labeled on the required landscape plan.
2. Utility meters shall be screened from street view and locations must be specified on plans.
3. Site drainage should be accommodated on the site so that water is directed away from the new
home and the neighboring properties. Neighboring properties must not be disturbed by the
creation of drainage swales. Specific storm water management requirements may be required,
as appropriate, including the addition of gutters for specific sites. Construction and the finished
structure must not have detrimental impact on storm water drainage patterns in the
neighborhood.
4. All air conditioning units must be located in the rear yard of the house or as approved by the
HRA.
C. Construction Requirements
1. Existing trees must be protected during construction. A tree wrap with board reinforcements
shall be sued on trees directly adjacent to active grading and construction area. Damaged or
destroyed trees must be replaced.
2. The construction site, neighboring properties and adjacent public streets shall be kept free of
construction debris at all times.
3. No construction workers, construction equipment or construction material shall encroach upon
neighboring properties.
4. The property shall have a new sanitary service line installed to the city sanitary sewer main
consisting of schedule 40 PVC or equivalent. If there is an existing 6" sewer stub at the property
line, it must be lined with 4" schedule 40 PVC or equivalent to the city’s sanitary main, and it
must include a "donut" at the end with cement.
The line must be televised after installation to ensure the following:
1. There are no obstructions in the line.
2. The PVC liner is not protruding into the city’s sanitary sewer main line.
D. General Standards
1. The value of the new home must meet or exceed the minimum value specified in the Contract for
Private Redevelopment.
2. All homes in the Richfield Rediscovered Program must be stick-built or high-quality modular, new
construction.
3. Exterior materials (siding, soffit, doors and windows) should be low-maintenance and durable.
Brick, aluminum, vinyl and fiber cement siding are preferred. Natural cedar lap is acceptable if
properly stained or painted. Hardboard panels or hardboard lap siding are prohibited. Roof
valleys should have metal valleys and not be woven.
4. Unit height and mass of the new house shall be compatible with the scale of the surrounding
homes in the neighborhood.
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5. Plans must present a balanced and pleasing distribution of wall, door and window areas from all
views.
6. The dominance of the garage door must be minimized through placement, architectural detail,
door design and utilization and design of windows. Front-loaded garages (where the garage door
faces the street), shall not be located closer to the front lot line than the foremost facade of the
principal building facing the front property line. Garage sidewalls that face the street should
appear to contain habitable space. This can be accomplished by incorporating windows and other
design elements into the garage wall that are in character with the remainder of the dwelling. For
lots that have alley access, the garage should be oriented to access the alley.
7. All building plans must have been prepared in consultation with an architect or qualified
draftsperson. All requirements by the Building Inspections Division must be met.
8. All Richfield Rediscovered houses must meet or exceed Minnesota Energy Code requirements.
9. All new homes should be built to provide high quality sound insulation. Recommendations for
sound insulation measures may be provided on a site-by-site basis. All construction must
conform to sound attenuation building standards as required by Zoning Ordinance Section 541.19
for properties located within the 2007 60-62 DNL Contour and 2007 63 or greater DNL contours.
10. If a variance is required to construct the proposed development, the HRA may, at its sole
discretion, choose to reject the application.
11. If the HRA accepts an application that needs a variance(s), sale of the property will be contingent
upon the applicant obtaining the necessary variance(s). The Applicant is responsible for applying
for the variance(s) at its own expense.
E. Green Community Concepts
Priority will be given to projects incorporating the green community concepts listed below. Any
concepts the applicant would like considered during the application process should be explained in a
cover letter submitted with the application.
1. Protect and conserve water and soil. To reduce water consumption, consider the use of water-
conserving appliances, fixtures, and landscaping. Steps should be taken to minimize the loss of
soil and sediment during construction and occupancy to reduce storm-water sediment and air
pollution.
2. Minimize energy consumption. Reduce energy consumption by taking advantage of natural
heating, cooling and day lighting, and by using energy-efficient appliances, equipment and
lighting.
3. Enhance indoor environmental quality. Use non-toxic materials, ventilation and exhaust systems,
and moisture control products and systems.
4. Use environmentally-preferable materials and resources. Use locally-produced, salvaged and/or
manufactured materials, products with recycled content or from renewable sources, recyclable or
reusable materials, and low-VOC-emitting materials.
5. Reduce waste . Reduce and manage wastes generated during the construction process and
operation of buildings. When demolition occurs, consider the sorting and recycling of leftover
materials and debris.
VIII. City Review Procedure
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1. Applicant reviews proposed project with HRA staff before plans are finalized.
2. HRA Staff will review application to ensure conformance with House Design and Site
Development Requirements.
3. HRA staff prepares a report and recommendation for the HRA.
4. A Contract for Private Redevelopment is reviewed and signed by applicants in advance of the HRA
meeting.
5. HRA reviews application and takes action at the HRA meeting.
6. If approved, the Contract for Private Redevelopm ent is executed by the HRA.
7. Upon approval by the HRA, the applicant is responsible for acquiring the necessary building and
demolition permits with the City of Richfield Inspections Department. If changes are required, the
Buyer must notify HRA staff.
IX. Disbursement of Funds
Approved projects are eligible for a $50,000 Redevelopment Credit. The Credit will be dispersed upon
completion of the project (including landscaping) and the issuance of a Certificate of Completion by the
Building Official. A lender may require a portion of the Redevelopment Credit be held as an escrow as
part of the interim financing of the project, only to be released upon project completion.
The Buyers may also request the Redevelopment Credit to be issued in three installments. The first
installment of $20,000 would be issued at the time of closing, the second for $20,000 when permits are
pulled and the third for $10,000 when the project has been completed and a Certificate of Completion has
been issued by the Building Official. A mortgage will be filed and a lien put on the house until the project
has been completed. Filing fees are the responsibility of the applicant.
The disbursement of funds will be outlined in the Contract for Private Redevelopment, to be executed by
the HRA and the Buyer.
X. Solicitation of New Development Proposals
The HRA will advertise the Richfield Redevelopment program in publications or newspapers, by direct
mail, or other methods as deemed appropriate, to solicit interest.
When the HRA has property information, it will provide the address of the property, lot dimensions and
contact information of the seller. Interested parties may contact the owners directly. All purchase
negotiations and timing issues must be resolved between the parties.
Properties identified by the applicant may also qualify. The HRA will review each one on a case-by-case
basis.
A program information package will be available upon request to interested Buyers. The information
packet will include the following:
• Richfield Rediscovered Procedural Guidelines
• Sample Contract for Private Redevelopment
• Application Cover Sheet
• Project Information Sheet
• Lot List
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XI. General Program Marketing
Richfield Rediscovered program marketing is entirely at the discretion of the HRA. It may include the
following:
1. Buyer Solicitation . The HRA may market the program to potential Buyers through promotional
articles, direct mail, the Internet, or other methods as deemed appropriate. Buyers may be any
financially capable individual or family, including first-time buyers, move-up buyers or empty-
nesters.
2. Public Promotion .
a. The HRA will periodically provide information about the program through articles in city
publications, on the City’s web site, on the Community Cable channel, or via press releases
to promote community awareness.
b. A public open house may be held to provide an opportunity for residents and other interested
parties to collectively view the finished homes. The Parade of Homes Fall Showcase and
Spring Preview may also accomplish this.
c. .
XII. Data Privacy
The HRA is subject to Minnesota Statutes Chapter 13 (the “Minnesota Government
Data Practices Act”). Under the Minnesota Government Data Practices Act, the names
and addresses of applicants for or recipients of assistance under this program and the
amount of assistance received under this program are public data. All other financial
information submitted to the HRA for purposes of the program application is considered
private data.
AGENDA SECTION:Consent Calendar
AGENDA ITEM #3.D.
STAFF REPORT NO. 12
HOUSING AND REDEVELOPMENT AUT HORIT Y
MEET ING
3/20/2017
REPORT PREPARED BY: Julie Urban, Housing Specialist
DEPARTMENT D IRECTOR REVIEW: John Stark, C ommunity Development Director
3/13/2017
OTHER DEPARTMENT REVIEW: N/A
CITY MANAGER REVIEW: Steven L. Devich, Executive Director
3/14/2017
IT EM FOR COUNCIL CONSIDERAT ION:
Consideration of the approval of recommended revisions to the New Home Program Guidelines.
EXECUT IVE SUM M ARY:
The New Home Program (Program) develops new housing opportunities for low- and moderate-income
families, elderly, and disabled persons. Through the Program, the Housing and Redevelopment Authority
(HRA) partners with non-profit housing developers to either construct new or rehabilitate existing housing,
making it available to households earning less than 80 percent of the Twin Cities Area Median Inc ome (AMI).
The guidelines are periodically reviewed and changes recommended, as appropriate.
The following changes to the Program Guidelines are recommended:
1. Clarify that the Program objectives include rehabilitating existing homes and developing homes with
long-term affordability, to the greatest extent possible.
2. Update substandard property selection and evaluation procedures.
3. Define the mec hanisms used to ensure long-term affordability.
RECOM MENDED ACT ION:
By Motion: Appr ove the recommended revisions to the New Home Progr am Guidelines.
BASIS OF RECOM M ENDAT ION:
A.HISTORICAL CONTEXT
The Program was created by the HRA in 1975 to help eliminate substandard residential properties
in the City, while providing additional housing affordable to moderate income families. For many
years, the primary focus of the Program has been to construct new housing (41 new homes were
built between 1990 and 2016); however, the decline in available houses suitable for demolition and
the inc reased c osts of new construction have led the HRA to focus resources on rehabilitating the
existing housing stoc k.
W hile the rehabilitation of properties has alway s been a part of the Program, the Guidelines have
been geared towards new c onstruction. The revised Guidelines more ac curately reflec t how the
Program is currently administered.
B.POLICIES (resolutions, ordinances, regulations, statutes, etc):
The Program objec tives are to eliminate substandard housing and improve neighborhoods,
maintain and improve the existing housing stoc k while maintaining housing affordability, develop
quality housing with long-term affordability, and to work with developers to provide affordable
housing for families.
C.CRITICAL TIMING ISSUES:
None
D.FINANCIAL IMPACT:
The proposed revisions have no financial impac t on the administration of the Program.
E.LEGAL CONSIDERATION:
The Guidelines provide a tool for consistent administration of the Program and should reflect
current practic es.
ALTERNATIVE RECOMMENDATION(S):
Commissioners may c hoose to not revise the New Home Program Guidelines.
PRINCIPAL PARTIES EXPECTED AT MEETING:
N/A
ATTACHMENTS:
Description Type
New Home Program Guidelines Revised 032017 Backup Materi al
NEW HOME PROGRAM
PROCEDURAL GUIDELINES
Revised:March 20, 2017
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Table of Contents
Statement of Purpose
Program Objective
Definitions
Data Privacy
Solicitation for Willing Sellers
Property Evaluation Procedures
Property Selection and General Procedures
Developer and End Buyer Approval Criteria
House Design and Site Development Requirements
Contractual Relationship with Developer
Plan Review
Sale to Developer
Long-term Affordability
General Program Marketing
Exhibits
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New Home Program
Procedural Guidelines
Statement of Purpose
The goal of the Richfield New Home Program (NHP) is to develop new housing opportunities for
low and moderate income families, elderly, and disabled persons.
Program Objectives
To eliminate the blighting influence of substandard housing, thus improving residential
neighborhoods.
To maintain and improve the existing housing stock while maintaining housing affordability.
To develop quality housing with long-term affordability, to the greatest extent possible.
To coordinate with developers to provide affordable housing for families.
These objectives will be achieved through both the removal of substandard property and
construction of new homes, and the rehabilitation/remodeling of existing homes.
Program Outcomes
Remove and replace or substantially rehabilitate neglected, substandard, very small, and
otherwise unsafe properties on scattered sites throughout the City.
Spur neighborhood investment with new construction or substantial rehabilitation.
Sell homes to families that may not otherwise be able to buy in Richfield.
Provide homebuyers, particularly first time homebuyers, with home ownership opportunities in
Richfield.
Expand the mix of housing choices available in Richfield.
Create housing with long-term affordability.
Develop relationships with nonprofits, school building programs, for profits, and other builders
or developers to encourage them to invest in Richfield.
Maintain and improve housing stock in Richfield.
Leverage city investment with developer’s investment in each project.
Expand tax base with higher value homes.
Definitions
Contract for Private Development (“Contract”)-The contract which is filed against the property
and governs the condition of the sale of the lot; the contract and all other construction documents.
Developer -Developer or Builder who has entered into a Contract with the HRA to purchase a
specific lot or lots and develop them with new homes.
End Buyer -The buyer of a new house sold by a Developer.
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HRA -Housing and Redevelopment Authority in and for the City of Richfield.
Seller -The voluntary Seller of a property purchased by the HRA for redevelopment.
Voluntary Acquisition -The purchase (acquisition) of real property which results from a voluntary
proposal to sell from an owner in response to an invitation or solicitation for offers.
Data Privacy
All information secured through the program is subject to the Data Privacy Act.
Solicitation of Willing Sellers
1.HRA staff will solicit for Sellers by direct mail, advertisement, or other method. The number
of properties purchased will be determined by the availability of resources and properties
available for voluntary sale.
2.Sale to the HRA occurs on a voluntary basis. Interested Sellers are required to respond to the
HRA solicitation in writing, with an offer indicating:
a)An interest in selling their property to the HRA.
b)A willingness to waive relocation benefits.
c)Statement of tenant interest in the property at the time of offer.
Property Evaluation Procedures
Properties will be evaluated based on the following criteria. To be eligible for acquisition, properties
must meet at least one of the four conditions under Criteria 1 (a, b, c or d), and must meet all Criteria
2 through 4.
1.The property is:
a)Substandard as to condition, size or usage; or
b)An obsolete design for the block and area in which it is located; or
c)Deteriorated such that it has caused blight to other adjoining properties; or
d)Detrimental to the safety or health of abutting properties on the block.
2.For new home construction, the site can be redeveloped with a new home within city code
requirements, including zoning and conformance with the Comprehensive Plan.
The property is reviewed in context with other redevelopment projects and does not cause a negative
impact.
3.The purchase and redevelopment of the property is financially feasible for the HRA.
Property Selection and General Procedures
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Based on the above information, HRA staff will identify the best candidates for acquisition. The
following criteria will be considered in further evaluation, each on a case by case basis. The number
of acquisitions by the HRA is determined by available resources.
1.Property acquisition priorities will be guided by the following items.
a)Properties must be available to meet the HRA development time frame.
b)Properties with one or more of the following characteristics should be considered
first:
i)lowest values
ii)poorest visible conditions
iii)historically troublesome properties
c)Properties purchased will be geographically distributed as much as possible.
2.Once a Letter of Intent from the property owner has been received, HRA staff will contact
the Seller and arrange an interior inspection.
3.If the HRA chooses to continue with the acquisition, a fee appraisal will be ordered to aid in
determining the purchase price of the property from the Seller and the reuse value of the
vacant lot.
4.Special considerations during the acquisition process will include:
a.)Vacant properties—these will be considered for acquisition, whether homestead
or non-homestead.
b.)Tenant occupied property will be considered on a case by case basis.
c.)Property expenses related to maintenance, taxes, and insurance should be
minimized since the HRA does not intend to retain title to the property.
d.)Review appraisal services may be part of the negotiating process to determine the
purchase price if the fee appraisal report values the property below the current
assessor’s market value.
e.)Negotiated prices considerably below the assessor’s market value may be
accepted without appraisal, on a case by case basis, if the Seller concurs.
5.Once a negotiated price has been reached, a Purchase Agreement, including a “Waiver of
Relocation Benefits” form, must be executed by the Seller for the acquisition process to
continue. The relocation benefits which the Seller agreed to waive must be clearly explained.
The Seller will be informed of the following:
a.)Purchase price;
b.)How the purchase price was determined.
c.)If negotiations fail, and the offer is not accepted, the HRA will not acquire the
property.
6.The Richfield Planning Commission must determine whether the acquisition and disposition
of the property is in conformance with the Richfield Comprehensive Plan.(This is an
administrative finding that does not require public hearing).
7.At the appropriate times, the HRA will be requested to authorize:
a.)Purchase Agreements
b.)Contracts for Private Development
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c.)Public Hearing and Disposition to Developer and/or End Buyer
Developer Approval Criteria
Private Developers will be approved by the HRA to construct or rehabilitate/remodel single family
homes on identified lots. Upon receipt of a proposal, HRA staff will evaluate the Developer based on
the following requirements:
1.Demonstrated capability and capacity, financially and managerially/supervisory.
2.Demonstrated trustworthy reputation.
3.Demonstrated state contractor’s license.
4.Approval of preliminary plans submitted for HRA design review.
5.Agreement with the terms of the Contract. A draft copy of the Contract will be provided
upon request. The Developer must execute the Contract by the time of the land sale from the
HRA to the Developer.
6.Agreement to complete construction within the time frame specified in the Contract. Every
effort must be made to complete construction and achieve occupancy within (150)days of
closing with the HRA.
House Design and Site Development Requirements
Siding materials, exterior facade presentation, roof, window, siding and building line variability,
finished landscape, interior space function and use are all important issues of design to the HRA
program. The criteria were created to ensure that the homes built or rehabilitated/remodeled on the
identified lots blend in with the surrounding neighborhood and respond to specific concerns of the
HRA.
The development of all sites shall meet the development criteria listed below, as reviewed and
approved by the HRA. To maximize the development of a given lot, the HRA reserves the right to
explore all development options without obligating the HRA to support any specific proposal, i dea
or solicitation.
The HRA reserves the right to reject any proposal.
1.Site Standards:
a)A landscape plan is required unless the HRA completes the landscaping separately.
The entire grounds shall be finish landscaped to be aesthetically pleasing in all
seasons. Land forms and plant materials shall be used to define the site and blend
neatly with adjoining property. Specific lot line blending requirements may be added,
as appropriate, for specific sites.
5
b)Utility meters shall be screened from street view; locations must be specified on
plans.
c)Site drainage shall be accommodated on the site so that water is directed away from
the Property and the neighboring properties. Neighboring properties should not be
disturbed to create drainage swales. Specific storm water management requirements
may be added, as appropriate, including gutters for specific sites.
d)Existing trees shall be preserved whenever possible. Care should be taken to preserve
existing root systems.
e)The construction site, neighboring property(s) and adjacent public streets shall be
kept free of construction debris at all times.
f)All air conditioning units must be located in the rear yard of the house or as approved
by the HRA.
g)No construction workers, construction equipment or construction material shall enter
neighboring properties.
2.Building Standards
a)Plans should allow for future basement finishing with a roughed-in bath and
additional bedroom or living space, including appropriately placed egress window(s).
b)A covered entry to dwelling and garage space should be provided.
c)The appearance of the new development is to blend with existing developments on
block as much as possible, paying attention to such details as roof pitch, setbacks,
house style, etc.
d)Attention must be given to details such as exterior window trim, muntins, type and
style of siding, and durability of all house components.
e)Plans must present a balanced and pleasing distribution of wall, door and window
areas from all views. Windows that are double hung in style or appearance wi th
muntins (window pane grids) are preferred, especially on the street-facing elevations.
Garage door dominance in design must be minimized.
f)Exterior materials (siding, soffit, doors and windows), should be low maintenance
and durable. Masonite siding is not acceptable. Roof valleys should not be woven,
but have metal valleys.
g)A garage, attached or detached, must be provided on the site.
h)Unit height and mass of new homes shall be compatible with the scale of the
surrounding neighborhood.
i)A full basement shall be provided in the house unless the selected design results in a
split level or garden level type of basement.
j)All building plans must be prepared in consultation with an architect or qualified
draftsperson.
k)All homes must meet or exceed Minnesota Energy Code requirements.
l)Recommendations for sound insulation measures may be provided on a site by site
basis. All new homes should be built to provide high quality sound insulation.
Contractual Relationship with Developer
1.For sites sold to Developers,the determination of value process considers independent
appraisal, current market trends, and the affordability of the finished home.
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2.A standard form Contract will be presented to the Developer for consideration. The Contract
includes conditions for acquisition, demolition and redevelopment of property. The selected
Developer will be required to execute a Contract for each property being redeveloped.
3.The following items specified in the Contract may require discussion and negotiation with
the Developer:
a)Construction start and completion dates.
b)Design
c)Design and Site Development Requirements
4.The HRA will be requested to authorize the following:
a)Property purchases from Sellers
b)Purchase Agreements
c)Contracts
d)Sales to Developers after a public hearing
5.Following HRA authorization of these items, a closing will be scheduled between the HRA
and Developer.
Plan Review
1.The Developer must provide one set of plans to HRA staff.
2.HRA staff will review all plans to ensure conformance with House Design and Site
Development Requirements. Each plan review by HRA staff will be completed in a timely
manner. Each plan submitted will be processed individually. If any element of the plan is in
conflict with the design requirements, HRA staff will notify the Developer and the Building
Official. The Building Official’s plan review is independent of the HRA.
3.The Developer must submit revised plans for final approval unless resolved to the
satisfaction of the HRA by modification to original copy of the plans.
Sale to Developer
The following will be required at the closing sale between the HRA and the Developer:
1.The HRA will convey the Property to the Developer by Quit Claim Deed.
2.The Developer must evidence that all Contract requirements to proceed with construction
have been met, and that all construction documents have been provided. This includes but is
not limited to insurance documents. Any required Letter of Credit must be from a local
Minneapolis/St. Paul metropolitan area financial institution.
3.The Developer will pay to the HRA, upon sale of the property to the End Buyer, the price of
the vacant, as identified in the Contract.
4.The HRA will prepare all documents required for closing, unless the parties agree otherwise.
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5.A “Completion Cash Escrow” will be required for all properties not completed by closing to
the End Buyer (e.g. landscaping, driveways, steps). A Certificate of Completion will not be
released without the escrow and the finalized escrow agreement.
Long Term Affordability
Every effort will be made to ensure long-term affordability. Mechanisms may include, but are not
limited to:
1.Sale of the property to a land trust.
2.Required use of purchase assistance funding in the form of a no interest, deferred loan, that is
due and payable when the buyer sells the property or upon maturity.(Exhibit A –Homebuyer
Assistance Guidelines,Exhibit B -Note,Exhibit C -Mortgage)
3.Required resale of the property to an income-qualified buyer.
4.Right of first refusal to buy back the property and resell it to an income-qualified buyer.
(Exhibit D)
General Program Marketing
Program marketing is entirely at the discretion of the HRA. It may include the following:
1.End Buyer Solicitation. The HRA may market the program to End Buyers through
promotional articles, direct mail, the Internet, or other methods as deemed appropriate. End
Buyers may be any financially eligible family. The HRA is a Fair Housing agency.
2.Developer Solicitation. The HRA may market the program to Developers by advertising in
professional publications or newspapers, by direct mail, or other methods as deemed
appropriate.
EXHIBITS
A.Homebuyer Assistance Guidelines
B.Promissory Note
C.Mortgage
D.Right of First Refusal
Exhibit A
Richfield Housing and Redevelopment Authority
Community Development Block Grant
Homebuyer Assistance Program Guidelines
1.Program Summary:
The Community Development Block Grant (CDBG)Homebuyer Assistance Program provides
up to $15,000 in down payment and closing cost assistance .The minimum amount of
Homebuyer Assistance is $5,000.
2.Loan terms:
a)Zero percent interest.
b)No monthly payment.
c)The loan is due and payable upon any of the following occurring, whichever comes first:
i.Home is sold;
ii.Ownership of home is transferred;
iii.Home is not the Borrower’s principal place of residency within sixty (60) days of
closing;
iv.Home is not maintained as the Borrower’s principal place of residence;and
v.30 years from the date of the mortgage.
d)These loans are considered a “Special Mortgage” under the terms of Minn. Stat. Section
58.13(23). If the Borrower chooses to refinance their primary loan and pay off this
mortgage, the Borrower will be required to provide proof of the completion of the
counseling described in Minn. Stat. Section 58.13(23)prior to receiving a satisfaction of
mortgage.
e)The Greater Metropolitan Housing Corporation (“GMHC”)administers the loan program,
but the Mortgagee is the Housing and Redevelopment in and for the City of Richfield
(“HRA”).
3.Loan amount:
a)The Borrower may receive up to $15,000 to help pay closing costs and/or a down
payment to help them qualify for their primary mortgage.The minimum amount of
Homebuyer Assistance is $5,000.The Borrower may receive all the money necessary to
help them qualify for their primary mortgage loan and, whenever possible, to bring the
housing ratio (principal, interest, taxes, mortgage insurance,and homeowner’s insurance
compared to income) to 30%,
4.Use of funds
The funds may be used for a down payment and normal and usual closing costs.The
Borrower may not receive any portion of these funds as cash.
5.Eligible Properties:
Properties built or renovated with CDBG funds from the HRA.
6.Borrower Eligibility:
a)Must be a US Citizen or be a legal US Resident (have legal immigration status).
b)The Borrower’s household income must not exceed 80% of the metropolitan
area median income.
c)The Borrower must have applied and qualify for and receive a traditional
(prime or A-rated) fixed-rate first mortgage loan.
d)Prior to approval of the assistance, income eligibility will be determined by
GMHC using the definition of income found at 24 CFR Part 5.609. Household income
refers to the annual projected income from the date of the Certification Application, from
all sources and before taxes and withholding of all adults that will live in the housing unit.
Gross income includes, but is not limited to salary, commissions, bonuses, earnings from
full or part-time employment, interest, dividends, tips, gains on sale of securities,
annuities, pension, royalties, veterans administration compensation, net rental inco me
from all sources, alimony, child support, public assistance, sick pay, social security
benefits, income from assets, business activity or investments, unemployment, estate or
trust income and miscellaneous income. (Note: Only $480 of the income from f ull-time
adult students is counted.)
The income from any of the following assets with a value over $5,000 will be computed as
the greater of 1) actual interest income; and 2) imputed income based on the percentage
rate established by HUD from time to time (currently six tenths percent (.06%)):
Cash in Checking and Savings Accounts;
Certificates of Deposit;
Retirement accounts such as IRAs, 401Ks and Deferred Compensation the
Borrower has access to;
Investment accounts, i.e., securities, stocks/bonds and U.S. Savings Bonds;
Life Insurance death benefits.
Redemption value of Life Insurance Policies; and/or
The current market value of all interests in real estate minus the current loan
amount and cost to sell the property.
e)The Borrower does not have to be a first time buyer.
f)The CDBG assisted property must be the primary residence of the Borrower.
g)The Borrower must occupy the property within 60 days following the closing, or in the
case of a property that will be rehabilitated after closing, within 60 days following
completion of construction.
h)The Borrower must contribute a minimum of $1,000 of his/her/their own funds as down
payment on the property.
i)The Borrower must have a housing ratio (principal, interest, taxes, mortgage insurance,
and homeowner’s insurance compared to income)of 30% or less after all assistance has
been applied. Borrowers who have a housing ratio in excess of 30%but no greater than
35%must show mitigating factors in order to qualify for a loan (e.g.housing is the only
debt).
j)The Borrower may have a cosigner that does not occupy the property, however,the
cosigner must sign an affidavit attesting that they will not reside at the property .
7.Homeownership Counseling:
First time home buyers must complete homeownership counseling through the Home Stretch
counseling program sponsored by the Minnesota Home Ownership Center (telephone 651 -
659-9336 or online at www.hocmn.org) or a comparable approved counseling program prior
to closing of the loan.
8.Combining funds:
a)Eligible primary financing:
i.The loan may be offered in connection with any fixed-rate FHA,VA,Fannie Mae, or
Freddie Mac insured or uninsured loan product that is generally considered in the
lending industry to be a “prime”or “A”lending product.
ii.This loan may not be used with sub-prime lending products.
b)CDBG Homebuyer Assistance loan funds may be combined with other assistance
programs to provide greater opportunity for the Borrower to secure the purchase of a
home.
9.Loan security
a)The CDBG Homebuyer Assistance loan funds will be secured by a Promissory Note and
Mortgage.
b)The loan may be secured in a subordinate lien position behind other program funds.
c)Title insurance is required.
Exhibit B
PROMISSORY NOTE
$_______________Richfield, Minnesota
________, ____
FOR VALUE RECEIVED, the undersigned ,(the “Borrower”, whether one or more),jointly and
severally agree(s) to pay to the order of the HOUSING AND REDEVELOPMENT AUTHORITY IN AND
FOR THE CITY OF RICHFIELD (the “Holder” or “HRA”), at 6700 Portland Avenue,Richfield, Minnesota
55423, or at such other place as the Holder, or its assigns, may from time to time designate, the principal sum
of Dollars ($).No interest shall accrue on the unpaid principal balance.The principal
balance shall be payable in coin or currency which at the time of payment is legal tender for the payment of
public or private debts in the United States of America. This Note evidences a loan, which includes all
extensions, renewals, modifications and substitutions (“Loan”).
1.SECURED BY MORTGAGE. This Note is secured by a mortgage (the “HRA Mortgage”) on certain
real property situated in Hennepin County, Minnesota (the “Property”). The Property is the Collateral
for the repayment of the loan evidenced by this Note. All of the terms, conditions, and agreements of
the HRA Mortgage are hereby made a part of this instrument to the same extent and with the same
force and effect as if fully set forth herein.
2.MATURITY DATE; PREPAYMENT.
2.1.All unpaid principal and all other amounts due under this Note shall be due and payable in full on
_____________,20__,(the “Maturity Date”)or upon the occurrence of an Event of Default (as
defined below)unless extended in writing by the Holder.
2.2.Borrower has the option to prepay all or any part of this Note at any time, without penalty.
3.DEFAULT.
3.1.Borrower shall be in default upon the occurrence of any of the following events, circumstances or
conditions (“Events of Default”):
A.Failure by any party obligated on this Note or the HRA Mortgage to make payment when
due; or
B.A default or breach by Borrower or any co-signer, endorser, surety, or guarantor under any of
the terms of this Note or the HRA Mortgage; or
C.When Borrower no longer uses the Property as Borrower’s principal
residence, or leases, sells, transfers, pledges, or conveys (voluntarily or by operation
of law) all or any part of Borrower’s interest in the Property. However, the following
shall not constitute a default under this subsection:
i.a transfer of a portion of the Property in or under threat of eminent domain
proceedings shall not be considered a sale under this paragraph unless it is a total taking in
the sense that payment is made for the full value of the Property;
ii.transfer of the Property by foreclosure or deed-in-lieu of foreclosure or assignment of
the HRA Mortgage to the Secretary of Housing and Urban Development;
or
D.The dissolution or insolvency of, the appointment of a receiver by or on behalf of, the
assignment for the benefit of creditors by or on behalf of, the voluntary or involuntary
termination of existence by, or the commencement of any proceeding under any present or
future federal or state insolvency, bankruptcy, reorganization, composition or debtor relief
law by or against any individual Borrower, or any co-signer, endorser, surety or guarantor of
this Note or any other obligations Borrower has with the Holder.
3.2 It is agreed that time is of the essence in performance of this Note and on or after the occurrence of an
Event of Default, at the Holder’s option, all or any part of the amount owing on this Note shall be
immediately due and payable without notice or demand. The Holder may exercise all rights and remedies
provided by law, equity, this Note and the HRA Mortgage. By choosing any remedy, the Holder does not
waive its right to an immediate use of any other remedy if the Event of Default continues or occurs again.
No delay or omission on the part of the Holder in exercising any right hereunder shall operate as a waiver of
such right or of any other remedy under this Note.A waiver on any one occasion shall not be construed as a
bar to or waiver of any such right or remedy on a future occasion.
5.BORROWER’S AGREEMENTS.
5.1.Regarding this Note, to the extent not prohibited by law, Borrower and any other signers:
A.Waive protest, presentment for payment, demand, notice of acceleration, notice of intent to
accelerate and notice of dishonor.
B.Consent to any renewals and extensions for payment on this Note, regardless of the number
of such renewals or extensions.
C.Consent to the Holder’s release of any borrower, endorser, guarantor, surety, accommodation
maker or any other co-signer.
D.Consent to the release, substitution or impairment of any Collateral.
E.Consent that Borrower is authorized to modify the terms of this Note or any instrument
securing, guaranteeing or relating to this Note.
F.Consent to any and all sales, repurchases and participations of this Note to any person in any
amounts and waive notice of such sales, repurchases or participations of this Note.
5.2.Borrower promises to pay to the Holder, in addition to the amount due hereon, the reasonable costs
and expenses (including attorney fees) incurred in enforcing or foreclosing this Note, the HRA
Mortgage, or any of the related documents executed by Borrower therewith, and all such costs and
expenses shall be secured by the HRA Mortgage.
6.GENERAL PROVISIONS
A.TIME IS OF THE ESSENCE. Time is of the essence in Borrower’s performance of all duties
and obligations imposed by this Note.
B.NO WAIVER BY HOLDER. The Holder’s course of dealing, or forbearance from, or delay in,
the exercise of any of the Holder’s rights, remedies, privileges or right to insist upon Borrower’s
strict performance of any provisions contained in this Note, or other loan documents, shall not be
construed as a waiver by the Holder, unless any such waiver is in writing and is signed by the
Holder.
C.AMENDMENT. The provisions contained in this Note may not be amended, except through a
written amendment that is signed by Borrower and the Holder.
D.INTEGRATION CLAUSE. This written Note and all documents executed concurrently
herewith, represent the entire understanding between the parties as to the obligations and may
not be contradicted by evidence of prior, contemporaneous, or subsequent oral agreements of the
parties.
E.FURTHER ASSURANCES. Borrower agrees, upon the Holder’s request and within the time
the Holder specifies, to provide any information, and to execute, acknowledge, deliver and
record or file such further instruments or documents as the Holder may require to secure this
Note or confirm any lien.
F.GOVERNING LAW. This Note shall be governed by the laws of the State of Minnesota,
provided that such laws are not otherwise preempted by federal laws and regulations.
G.FORUM AND VENUE. In the event of litigation pertaining to this Note, the forum, venue and
place of jurisdiction shall be the State of Minnesota, unless otherwise designated in writing by
the Holder or otherwise required by law.
H.SUCCESSORS. This Note shall inure to the benefit of and bind the heirs, personal
representatives, successors and assigns of the parties; provided however, that Borrower may not
assign, transfer or delegate any of the rights or obligations under this Note.
I.NUMBER AND GENDER. Whenever used, the singular shall include the plural, the plural the
singular, and the use of any gender shall be applicable to all genders.
J.DEFINITIONS. The terms used in this Note, if not defined herein, shall have their meanings as
defined in the other documents executed contemporaneously or in conjunction with this Note.
K.PARAGRAPH HEADINGS. The headings at the beginning of any paragraph, or any
subparagraph, in this Note are for convenience only and shall not be dispositive in interpreting or
construing this Note.
L.IF HELD UNENFORCEABLE. If any provision of this Note shall be held unenforceable or
void, then such provision to the extent not otherwise limited by law shall be severable from the
remaining provisions and shall in no way affect the enforceability of the remaining provisions
nor the validity of this Note.
M.NOTICE. All notices under this Note must be in writing. Any notice given by the Holder to
Borrower will be effective upon personal delivery or 24 hours after mailing by first class United
States mail, postage prepaid, addressed to Borrower at the address indicated on page one of this
Note. Such address may be changed by written notice to the other party.
7.RECEIPT OF COPY. Borrower acknowledges that Borrower has read and received a copy of this
Note by its signature below.
IN WITNESS WHEREOF, the Borrower has caused this Note to be executed as of the day and year first
above written.
,Borrower
,Borrower
Exhibit B
Legal Description of the Property:
Property Identification:
Mailing Address:
Purchased by on .
Exhibit C
MORTGAGE (NO INTEREST)
CDBG HOMEBUYER ASSISTANCE PROGRAM
(THIS MORTGAGE IS EXEMPT FROM THE PAYMENT OF MORTGAGE REGISTRATION
TAX UNDER MINN. STAT. § 287.04(F) IN THAT THE MORTGAGE RELATES TO A LOAN
MADE UNDER A LOW AND MODERATE INCOME HOUSING PROGRAM BY A LOCAL
GOVERNMENT AGENCY.)
THIS MORTGAGE is made this day of between the Mortgagor,, a
(“Borrower”), and the Mortgagee,HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE
CITY OF RICHFIELD (“HRA”), a public body corporate and politic under the laws of the State of
Minnesota, whose address is 6700 Portland Avenue,Richfield, Minnesota 55423 (“City”).
WHEREAS, Borrower is indebted to HRA in the principal sum of and 00/100 Dollars
($), which indebtedness is evidenced by Borrower's promissory note dated (“Note”), a copy of
which is attached as Exhibit A, with the balance of indebtedness, if not sooner paid pursuant to the terms of
the attached Note, due and payable on (the “Maturity Date”).All of the terms, conditions, and
agreements of the Promissory Note are hereby made a part of this instrument to the same extent and with the
same force and effect as if fully set forth herein.
TO SECURE to HRA the repayment of the indebtedness evidenced by the Note and the performance
of the covenants and agreements of Borrower herein contained, Borrower does hereby grant and convey to
HRA, forever, with power of sale, the real property located in the County of Hennepin, State of Minnesota,
legally described on the attached Exhibit B, which has the address ,Richfield, Minnesota (the “Property
Address”);
TOGETHER with all the buildings, improvements, fixtures and equipment now or hereafter attached
to the property including, but not limited to, all heating, air conditioning, ventilation, plumbing, cooling,
electrical and lighting fixtures and equipment, all landscaping, all exterior and interior improvements, all
easements, rights, appurtenances, rents, royalties, mineral, oil and gas rights, profits, water, water rights, and
water stock, all of which, including replacements and additions thereto, shall be deemed to be and remain a
part of the property covered by this Mortgage, and all of the foregoing, together with said property are herein
collectively referred to as the “Property”.
Borrower covenants that Borrower is lawfully seized of the Property and has the right to grant and
convey the same; that the Property is free from all encumbrances, except for a first mortgage in favor of
, its successors and assigns; and that the Borrower will warrant and defend generally the title to the
Property against all claims and demands, subject to declarations, easements or restrictions of record, if any.
Borrower represents that all statements made in any certificate or other statement given by Borrower to obtain
the loan secured by this Mortgage are true and correct.
For and in consideration of the terms herein and for other good and valuable consideration, the
sufficiency of which is hereby acknowledged, Borrower and HRA covenant and agree as follows:
1.Payment of Principal. Borrower shall promptly pay when due the principal and
interest of the indebtedness evidenced by the Note.
2.Charges; Liens. Borrower shall pay all taxes and assessments now due or that may hereafter
become liens against the Property before penalty attaches thereto.
3.Hazard Insurance. Borrower shall keep all buildings, improvements and fixtures now or later
located on or a part of the Property insured against loss by fire, hazards within the term “extended coverage,”
vandalism, malicious mischief, and other hazards as the HRA may require and in at least the amount of the
replacement cost at all times while any amount remains unpaid under this Mortgage and any prior liens.
Each insurance policy shall contain a loss payable clause in favor of the HRA affording all rights and
privileges customarily provided under the so-called standard mortgage clause. In the event of damage to the
Property by fire or other casualty, Borrower shall promptly give notice of such damage to HRA and the
insurance company. The insurance shall be issued by an insurance company or companies licensed to do
business in the State of Minnesota and acceptable to HRA. The insurance policies shall provide for not less
than 30 days written notice to HRA before cancellation, non-renewal, termination, or change in coverage, and
Borrower shall deliver to HRA a duplicate original or certificate of such insurance policies.
Unless HRA and Borrower otherwise agree in writing, insurance proceeds shall be applied to
restoration of the property damaged, provided such restoration or repair is economically feasible and the
security of this Mortgage is not thereby impaired. If restoration or repair is not economically feasible or if the
security of this Mortgage would be impaired, the insurance proceeds shall be applied to the sums secured by
this Mortgage, with the excess, if any, paid to Borrower. If the Property is abandoned by Borrower, or if
Borrower fails to respond to HRA within 30 days from the date notice is mailed by HRA to Borrower that the
insurance carrier offers to settle a claim for insurance benefits,HRA is authorized to collect and apply the
insurance proceeds at HRA’s option either to restoration or repair of the Property or to the sums secured by
this Mortgage. However, this mortgage is subordinate to the first mortgage.
4.Preservation and Maintenance of Property. Borrower shall keep the Property in good repair
and shall not commit waste or permit impairment or deterioration of the Property. If this Mortgage
encumbers a unit in a condominium or a planned unit development, Borrower shall perform all of Borrower's
obligations under the declaration of covenants creating or governing the condominium or planned unit
development, the bylaws and regulations of the condominium or planned unit development, and constituent
documents. If a condominium or planned unit development rider is executed by Borrower and recorded
together with this Mortgage, the covenants and agreements of such rider shall be incorporated into and shall
amend and supplement the covenants and agreements of this Mortgage as if the rider were a part hereof.
5.Protection of HRA Security. If Borrower fails to perform the covenants and agreements
contained in this Mortgage, or if any action or proceeding is commenced which materially affects HRA’s
interest in the Property, including, but not limited to, eminent domain, insolvency, code enforcement,or
arrangements or proceedings involving a bankrupt or decedent, then HRA at HRA’s option, upon notice to
Borrower, may make such appearances, disburse such sums and take such action as is necessary to protect
HRA’s interest, including,but not limited to, disbursement of reasonable attorney's fees and entry upon the
Property to make repairs.
Any amounts disbursed by HRA pursuant to this paragraph, shall become additional indebtedness of
Borrower secured by this Mortgage. Unless Borrower and HRA agree to other terms of payment, such
amounts shall be payable upon notice from HRA to Borrower requesting payment thereof, and shall bear
interest from the date of disbursement at the highest rate permissible under applicable law. Nothing contained
in this paragraph shall require HRA to incur any expense or take any action hereunder.
6.Inspection.HRA may make or cause to be made reasonable entries upon and inspections of
the Property, provided that HRA shall give Borrower notice prior to any such inspection specifying
reasonable cause therefore related to HRA’s interest in the Property.
7.Condemnation. The proceeds of any award or claim for damages, direct or consequential, in
connection with any condemnation or other taking of the Property, or part thereof, or for conveyance in lieu
of condemnation, are hereby assigned and shall be paid to HRA. However, this mortgage is subordinate to
the rights of the first mortgage.
In the event of a total taking of the Property, the proceeds shall be applied to the sums secured by this
Mortgage, with the excess, if any, paid to Borrower. In the event of a partial taking of the Property, unless
Borrower and HRA otherwise agree in writing, the condemnation proceeds shall be applied to the sums
secured by this Mortgage in proportion to the ratio that the secured sums bear to the fair market value of the
Property immediately before the taking.
8.Accelerations; Remedies. Unless the Maturity Date has occurred, upon Borrower's breach of
any covenant, representation or agreement of Borrower in this Mortgage or the Note, including the covenants
to pay when due any sums secured by this Mortgage, Borrower confers upon the HRA the option of declaring
the unpaid balance of the Note, together with all sums advanced hereunder, and the interest accrued thereon,
if any, immediately due and payable without notice, and hereby authorizes and empowers HRA to foreclose
this Mortgage by judicial proceedings or to sell the Property at public auction and convey the same to the
purchaser in fee simple in accordance with the statute, and out of the monies arising from such sale to retain
all sums secured hereby, with interest and all legal costs and charges of such foreclosure and the maximum
attorney's fee permitted by law, which costs, charges and fees Borrower agrees to pay.
HRA agrees that, if it intends to foreclose,HRA will give Borrower written notice of any default
under the terms and conditions of the Note or this Mortgage, by sending the notice to Borrower as provided in
paragraph 16 hereof. The notice of default shall contain the following provisions:
A.the nature of the default by Borrower;
B.the action required to cure the default;
C.a date,not less than 30 days from the date the notice is mailed to Borrower, by which such
default must be cured;
D.that failure to cure the default on or before the date specified in the notice may result in
acceleration of the sums secured by this Mortgage and sale of the Property;
E.that Borrower has the right to reinstate this Mortgage after acceleration; and
F.that Borrower has the right to bring a court action to assert the nonexistence of a default or
any other defense of Borrower to acceleration and sale.
9.Assignment of Rents; Appointment of Receiver. As additional security hereunder, Borrower
hereby assigns to HRA the rents of the Property, provided that Borrower shall, prior to acceleration under
paragraph 8 hereof or abandonment of the Property, have the right to collect and retain such rents as they
become due and payable.
Upon acceleration under paragraph 8 hereof or abandonment of the Property, and at any time prior to
the expiration of any period of redemption following sale of the Property,HRA shall be entitled to have a
receiver appointed by a court to enter upon, take possession of and manage the Property and to collect the
rents of the Property including those past due. All rents and income from the Property collected by the
receiver shall be applied first to the costs of management of the Property and collection of rents, including,
but not limited to the receiver's fees, premiums on the receiver's bonds and reasonable attorney's fees, and
then to the sums secured by this Mortgage. The receiver shall be liable to account only for those rents
actually received.
10.Satisfaction/Release. Upon payment of all sums secured by this Mortgage,HRA shall
provide Borrower with a satisfaction/release of Mortgage without charge to Borrower. Borrower shall pay all
recording costs.
11.Subject to First Mortgage. This Mortgage is subject and subordinate to a first mortgage of
even date herewith given by to .
12.Borrower Not Released. Extension of the time for payment of the sums secured by this
Mortgage granted by HRA shall not operate to release, in any manner, the liability of original Borrower and
Borrower's successors in interest.
13.Forbearance Not a Waiver. Any forbearance by HRA in exercising any right or remedy
hereunder, or otherwise afforded by applicable law, shall not be a waiver of or preclude the exercise of any
such right or remedy. The procurement of insurance or the payment of taxes or other liens or charges by
HRA shall not be a waiver of HRA’s right to accelerate the indebtedness secured by this Mortgage.
14.Remedies Cumulative. All remedies provided in this Mortgage are distinct and cumulative to
any other right or remedy under this Mortgage or afforded by law or equity, and may be exercised
concurrently, independently or successively.
15.Successors and Assigns Bound; Joint and Several Liability; Captions. The covenants and
agreements herein contained shall bind, and the rights hereunder shall inure to, the respective successors and
assigns of HRA and Borrower. All covenants and agreements of Borrower shall be joint and several. The
captions and headings of the paragraphs of this Mortgage are for convenience only and are not be used to
interpret or define the provisions hereof.
16.Notice. Except for any notice required under applicable law to be given in another manner,
notices shall be given by mailing the notice by certified mail, return receipt requested, to: (a) Borrower at the
Property Address or such other address as Borrower may designate by notice to HRA; and (b)HRA at the
address stated herein or such other address as HRA may designate by notice to Borrower. Notice is deemed
to have been given upon mailing.
17.Governing Law; Severability. This Mortgage is governed by Minnesota law. In the
event that any provision or clause of this Mortgage or the Note conflicts with Minnesota law,
such conflict shall not affect other provisions of this Mortgage or t he Note which can be
given effect without the conflicting provisions, and to this extent the provisions of the
Mortgage and the Note are declared to be severable.
19.Death of Borrower.If Borrower dies and leaves the property to his or her heirs,HRA may
permit the heirs to live at the property without having to repay the Loan.HRA may do this if HRA believes
the heirs do not have money to repay the Loan and if heirs continue to occupy the property as their principal
place of residence.HRA may make the heirs sign a new Agreement.
20.Borrower’s Compliance with Federal Regulations. Borrower agrees to comply with all U.S.
Department of Housing and Urban Development regulations that govern the HRA’s CDBG Homebuyer
Assistance Program, including but not limited to Community Development Block Grant regulations and Lead
Based Paint Regulations.
IN WITNESS WHEREOF, BORROWER HAS EXECUTED THIS MORTGAGE ON THE DAY
AND YEAR FIRST ABOVE-WRITTEN.
_______________________________
,Borrower
_______________________________
,Borrower
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this ___day of ____________, ______ by
,a .
________________________________
Notary Public
This instrument was drafted by:
Housing & Redevelopment Authority in and for the City of Richfield, Minnesota
6700 Portland Avenue
Richfield, MN 55423
Exhibit D
RIGHT OF FIRST REFUSAL
This AGREEMENT is made as of the ___day of __________,20__,by and
between _____________________,a single person,(marital status)and the
HOUSING AND REDEVELOPMENT AUTHOR ITY IN AND FOR
THE CITY OF R ICHFIEL D ,a public body corporate and politic under the laws
of the State of Minnesota,whose address is 6700 Portland Avenue, Richfield, Minnesota
55423 (“Second Party”).
Recitals
A Contemporaneously with the execution hereof,Second Party as the fee
owner of the real estate described on Exhibit A attached hereto and incorporated herein
(the “Property”),subject to matters of record,is conveying the Property to First Party.
B.First Party and Second Party desire to enter into this Agreement whereby
First Party grants to Second Party the right of first refusal to purchase the Property.
NOW,THEREFORE,in consideration of the Recitals and of the sum of One
Dollar ($1.00) and other good and valuable consideration and of the obligations of First
Party and Second Party as hereinafter set forth,First Party and Second Party agree as
follows:
1.Incorporation of Recitals.The Recitals are incorporated into and made a
part of this Agreement.
2.First Refusal Right.Second Party shall have the right to purchase the
Property in accordance with the terms and conditions herein (the “First Refusal Right”);
(a)First Party shall notify Second Party of First Party's desire to sell the
Property or any portion thereof (“Sale Notice”) at least thirty (30)days before: (i)
listing the Property for sale;(ii)making a formal offer to sell the Property to a third
party;or (iii)accepting an offer from a third party seeking to purchase the Property,or
(iv)any transfer of any of the First Party's interest in the Property.The Sale Notice shall
describe the Property being sold,the desired closing date and any other relevant terms
(as deemed by Second Party).Within thirty (30)days after receiving the Sale Notice
from First Party,Second Party may elect (by giving First Party written notice of
Second Party's intent to exercise its First Refusal Right)to purchase all of the Property
at the Purchase Price,as determined pursuant to the formula set forth below (the
“Election”).If Second Party makes the Election, First Party shall sell the Property to
Second Party for the Purchase Price on reasonably agreeable closing terms.
(b)if Second Party fails to exercise its First Refusal Right within the time
period specified in the preceding paragraph,then the First Refusal Right shall
automatically become null and void.Notwithstanding the foregoing,if,for any reason,
First Party fails to close on the sale of the Property within twelve (12)months of the Sale
Notice,its First Refusal Right shall remain in full force and effect.
(c)if Second Party exercises its First Refusal Right,Second Party shall be
responsible for, and pay the cost of,having a purchase agreement drafted for the Property.
(d)The purchase price,payable by Second Party,pursuant to its exercise of
the First Refusal Right,shall be established as follows:
(1)The parties shall jointly select an appraiser to determine the purchase
price,which shall be fair market value.
(2)If a single appraiser cannot be agreed upon within a ten (10)day
period,then each of the parties shall promptly designate in writing delivered to
the other,an appraiser who has substantial experience in real estate valuation and
who is unaffiliated with and otherwise unrelated to the designating party.The
two appraisers shall choose a third appraiser,similarly qualified,within fifteen
(15)days after their selection.If the first two appraisers do not agree upon a third
within that time period,the third shall be selected by arbitration pursuant to the
rules and procedures of the American Arbitration Association then in effect.Each
of the three appraisers shall provide an opinion of the fair market value of the
property and the purchase price shall be the average of the two (2)which are
closest to each other.Each party shall bear the cost of the appraiser selected by it
and one-half of the cost of the third appraiser.
(e)The closing of the Second Party's purchase of the Property as contemplated
by this section (the “Closing”)shall occur within one hundred eighty (180)days after the
Sale Notice is given to Second Party,unless postponed or extended in writing by the
parties hereto.The Closing shall take place at a mutually acceptable time and location.
3.Notices.All documents to be delivered and all correspondence and notices to be
given in connection with this Agreement shall be in writing and given by personal delivery or
sent by registered or certified mail, return receipt requested,postage prepaid,addressed as
follows:
If to First Party:[insert address and contact person]
If to Second Party:Richfield Housing and Redevelopment
Authority
Attn: Housing Specialist
6700 Portland Avenue South
Richfield, MN 55423
Each such mailed notice or communication shall be deemed to have been given to or served
upon,the party to whom it is addressed on the date the same is deposited in the United States
registered or certified mail,return receipt requested,postage prepaid,properly addressed in the
manner above provided.Either party hereto may change such party's address for the service of
notice hereunder by written notice of said change to the other party hereto,in the manner above
specified ten (10)days prior to the effective date of said change.
4.Successors and Assigns.This Agreement shall be binding upon and inure to the
benefit of each of the parties hereto,their respective successors and assigns.
5.Default. Should either party default in the performance of its obligations
hereunder,the other party shall have and may pursue all rights and remedies available to it
hereunder,at law or in equity,or otherwise,including,but not limited to,an action for damages or
specific performance.
6.Time of the Essence.Time is of the essence in the performance of this Agreement.
7.Counterparts.This Agreement may be executed in any number of counterparts,
each of which shall be an original, and all of which shall constitute one and the same agreement.
8.Governing Law.This Agreement concerns real property located in the State of
Minnesota and,therefore, its validity,performance,interpretation and enforcement shall be
governed by Minnesota law without giving effect to the choice of laws provisions thereof.
9.Captions.The paragraph headings or captions appearing in this Agreement are
for convenience only,are not a part of this Agreement,and are not to be considered in interpreting
this Agreement.
10.Foreclosure or Deed in Lieu.In the event of foreclosure,or a deed in lieu of
foreclosure of the First Mortgage,any provision herein or in any collateral agreement restricting the
use of the Property or restricting the Borrower's ability to sell the Property,shall automatically have
no further force or effect on subsequent owners or purchasers of the Property.Any person,
including his successors and assigns,(other than the Borrower or related entity or person to the
Borrower) receiving title to the Property through a foreclosure or deed in lieu of foreclosure of the
First Mortgage shall receive title to the Property free and clear from such restriction.
-.
IN WITNESS WHEREOF the parties have executed this Agreement as of the day and
year first set forth above.
____________________________
_______________________________
,
_______________________________
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this ___day of ____________, ______
by ,a .
________________________________
Notary Public
This instrument was drafted by:
Housing &Redevelopment Authority in and for the City of Richfield, Minnesota
6700 Portland Avenue
Richfield, MN 55423
-.
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD
By:___________________________________
_____________
Its:Chairperson
By:___________________________________
________________
Its:Executive Director
STATE OF MINNESOTA )
)
COUNTY OF HENNEPIN )
The foregoing was acknowledged before me this ____ day of _______, 20__, by
______________, the Chairperson of the Housing and Redevelopment Authority in and for the City of
Richfield, a public body corporate and politic under the laws of Minnesota, on behalf of the corporation,
Mortgagee.
______________________________________
Notary Public
STATE OF MINNESOTA )
)
COUNTY OF HENNEPIN )
The foregoing was acknowledged before me this ____ day of _______, 20__, by
_____________, the Executive Director of the Housing and Redevelopment Authority in and for the
City of Richfield, a public body corporate and politic under the laws of Minnesota, on behalf of the
corporation, Mortgagee.
______________________________________
Notary Public
.
EXHIBIT A
LEGAL DESCRIPTION
AGENDA SECTION:Consent Calendar
AGENDA ITEM #3.E.
STAFF REPORT NO. 13
HOUSING AND REDEVELOPMENT AUT HORIT Y
MEET ING
3/20/2017
REPORT PREPARED BY: Myrt Link, C ommunity Development Accountant
DEPARTMENT D IRECTOR REVIEW: John Stark, C ommunity Development Director
2/14/2017
OTHER DEPARTMENT REVIEW: N/A
CITY MANAGER REVIEW: Steven L. Devich, Executive Director
2/15/2017
IT EM FOR COUNCIL CONSIDERAT ION:
Consideration of the approval of a resolution authorizing an interfund loan up to $400,000 for advance
of certain costs in connection with the Inter change Tax Increment Financing District.
EXECUT IVE SUM M ARY:
The Interchange Tax Inc rement Financing (TIF) District is a redevelopment distric t c omprised of the Dick's
Sporting Goods (formerly Galyan's) store. The District was approved in 1996 and increment was first received
in 1998.
A Pay -As-You-Go Note (Note) in the amount of $3,323,309 was issued to the Developer in 1999. The
Developer receives 90% of the increment generated until the Note matures in February 2019. Payments are
made semiannually on February 1 and August 1.
In J anuary 2017, the HRA was notified by Hennepin County that due to tax petitions filed and settled in Tax
Court, that overpay ment of increment had been made to the HRA and in turn resulted in overpayment to the
Developer. The amount of the overpayment is $330,677 and encompasses the y ears 2013 - 2015. A reduction
in value is also ordered for 2016.
As a result of the overpayment, the HRA must withhold future payments on the Note until it has rec ouped the
amount owed to them. It is anticipated, based on current increment rec eipts, that the HRA would be fully
reimbursed by August 2018. In the event that inc rement receipts are lower than c urrently anticipated, the HRA
would still be able to rec over all the funds owed to them. The Note matures in 2019, but the Distric t does not
decertify until 2023 so increment will continue to be generated until then.
Due to reporting requirements enforced by the Offic e of the State Auditor, the HRA must establish an
interfund loan from an existing funding source to repay Hennepin County. T he funding source for the
interfund loan is the HRA Capital Improvement Fund. T he amount authorized is in the amount not to
exceed $400,000 with an annual interest rate of 4%.
RECOM MENDED ACT ION:
By Motion: Appr ove a resolution authorizing an interfund loan for up to $400,000 for advance of certain
costs in connection with the Interchange Tax Increment Financing Distr ict.
BASIS OF RECOM M ENDAT ION:
A.HISTORICAL CONTEXT
The Interchange Tax Inc rement Financ ing Distric t was approved in 1996. First rec eipt of
increment was in 1998.
A Pay-As-You-Go Note in the amount of $3,323,309 was issued to the Developer in 1999.
Pay ment on the Note is made semiannually from available tax increment.
In January 2017, the HRA was notified of overpay ment of increment due to settled tax petitions.
The amount of over payment is $330,676.
As a result of Hennepin County overpay ing the HRA, the HRA in turn overpaid the Developer on
the TIF Note.
Due to reporting requirements, the HRA must establish an interfund loan from an existing funding
sourc e. It is projected that the interfund loan will be paid in full from tax increment generated. Even
though the Note matures in 2019, the Distric t is not required to be dec ertified until 2023.
The funding source is the HRA Capital Improvement Fund and the amount of the loan is not to
exc eed $400,000 with a 4% interest rate.
B.POLICIES (resolutions, ordinances, regulations, statutes, etc):
It is the HRA's polic y to comply with the Office of the State Auditor's reporting requirements.
C.CRITICAL TIMING ISSUES:
It is important to establish an interfund loan as soon as possible to c omply with the Office of the
State Auditor's reporting requirements.
D.FINANCIAL IMPACT:
The interfund loan is authorized in an amount not to exceed $400,000.
The funding source if the HRA Capital Improvement Fund.
The interest rate is 4%.
The Interchange Tax Inc rement Financ ing Distric t will generate enough inc rement for the loan to
be paid back in full.
E.LEGAL CONSIDERATION:
The resolution was drafted by the HRA's financ ial c onsultants, Ehlers and Assoc iates.
ALTERNATIVE RECOMMENDATION(S):
The HRA may not approve the interfund loan; however, the HRA would not be in complianc e with the
Office of the State Auditor's reporting requirements.
PRINCIPAL PARTIES EXPECTED AT MEETING:
None
ATTACHMENTS:
Description Type
Resoluti on Resolution Letter
RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY
CITY OF RICHFIELD
HENNEPIN COUNTY
STATE OF MINNESOTA
RESOLUTION NO. _____________
RESOLUTION AUTHORIZING AN INTERFUND LOAN FOR ADVANCE OF
CERTAIN COSTS IN CONNECTION WITH THE INTERCHANGE TAX
INCREMENT FINANCING DISTRICT.
BE IT RESOLVED by the Board of Commissioners (the "Board") of the Richfield Housing and
Redevelopment Authority (the "HRA") of the City of Richfield, Minnesota, as follows:
WHEREAS, the City Council for the City of Richfield, Minnesota (the "City"), established the
Interchange Tax Increment Financing District (the "TIF District") within the Richfield Redevelopment
Project Area (the "Project"), and adopted a Tax Increment Financing Plan (the "TIF Plan") for the purpose
of financing certain improvements within the Project; and
WHEREAS, under Minnesota Statutes, Section 469.178, Subd. 7, the HRA is authorized to
advance or loan money from the HRA's general fund or any other fund from which such advances may be
legally authorized, in order to finance the Qualified Costs; and
WHEREA, the HRA has entered into obligations and has reimbursed Developers for Qualified
Costs accordingly; and
WHEREAS, Hennepin county has reduced prior year increment receipts in accordance with tax
court petitions, which were made after the increment was paid according to the obligations, which caused
the TIF District fund to become negative; and
WHEREAS, the HRA intends to reimburse itself for the reducution from tax increments derived
from the TIF District in accordance with the terms of this resolution (which terms are referred to
collectively as the "Interfund Loan").
NOW THEREFORE BE IT RESOLVED by the Board as follows:
1. The HRA hereby authorizes the advance of up to $400,000 from the HRA Capital Improvement
fund or so much thereof as may be paid as Qualified Costs. The HRA shall reimburse itself for
such advances together with interest at the rate stated below. Interest accrues on the principal
amount from the date of each advance. The maximum rate of interest permitted to be charged is
limited to the greater of the rates specified under Minnesota Statutes, Section 270C.40 or Section
549.09 as of the date the loan or advance is authorized, unless the written agreement states that
the maximum interest rate will fluctuate as the interest rates specified under Minnesota Statutes,
Section 270C.40 or Section 549.09 are from time to time adjusted. The interest rate shall be 4%
and will not fluctuate.
2. Principal and interest ("Payments") on the Interfund Loan shall be paid annually on each
December 31 (the "Payment Date"), commencing on the first Payment Date on which the HRA
has Available Tax Increment (defined below), or on any other dates determined by the
Community Development Director, through the date of last receipt of tax increment from the TIF
District.
3. Payments on this Interfund Loan are payable solely from "Available Tax Increment," which shall
mean, on the Payment Date, tax increment available as determined by the Community
Development Director, generated in the preceding six (12) months with respect to the property
within the TIF District and remitted to the City by Hennepin County, all in accordance with
Minnesota Statutes, Sections 469.174 to 469.1799, all inclusive, as amended. Payments on this
Interfund Loan may be subordinated to any outstanding or future bonds, notes or contracts
secured in whole or in part with Available Tax Increment, and are on parity with any other
outstanding or future interfund loans secured in whole or in part with Available Tax Increment.
4. The principal sum and all accrued interest payable under this Interfund Loan are pre-payable in
whole or in part at any time by the HRA without premium or penalty. No partial prepayment
shall affect the amount or timing of any other regular payment otherwise required to be made
under this Interfund Loan.
5. This Interfund Loan is evidence of an internal borrowing by the HRA in accordance with
Minnesota Statutes, Section 469.178, Subd. 7, and is a limited obligation payable solely from
Available Tax Increment pledged to the payment hereof under this resolution. This Interfund
Loan and the interest hereon shall not be deemed to constitute a general obligation of the State of
Minnesota or any political subdivision thereof, including, without limitation, the HRA. Neither
the State of Minnesota, nor any political subdivision thereof shall be obligated to pay the
principal of or interest on this Interfund Loan or other costs incident hereto except out of
Available Tax Increment, and neither the full faith and credit nor the taxing power of the State of
Minnesota or any political subdivision thereof is pledged to the payment of the principal of or
interest on this Interfund Loan or other costs incident hereto. The HRA shall have no obligation
to pay any principal amount of the Interfund Loan or accrued interest thereon, which may remain
unpaid after the final Payment Date.
6. The HRA may amend the terms of this Interfund Loan at any time by resolution of the Board,
including a determination to forgive the outstanding principal amount and accrued interest to the
extent permissible under law.
Approved by the Board on March 20, 2017.
_______________________________
Mary B. Supple, Chair
ATTEST:
______________________________
Doris Rubenstein, Secretary
AGENDA SECTION:Consent Calendar
AGENDA ITEM #3.F.
STAFF REPORT NO. 14
HOUSING AND REDEVELOPMENT AUT HORIT Y
MEET ING
3/20/2017
REPORT PREPARED BY: Myrt Link, C ommunity Development Accountant
DEPARTMENT D IRECTOR REVIEW: John Stark, C ommunity Development Director
3/16/2017
OTHER DEPARTMENT REVIEW: N/A
CITY MANAGER REVIEW: Steven L. Devich, Executive Director
IT EM FOR COUNCIL CONSIDERAT ION:
Consideration of the approval of a resolution approving a Subordination Agr eement related to Richfield
Urban Village.
EXECUT IVE SUM M ARY:
The Urban Village Tax Inc rement Financing Distric t (Distric t) was certified in J uly 1999. It is a Redevelopment
District that inc ludes BMO Harris Bank, McDonald's, The Oaks on Pleasant, The Pines, and other offic e/retail
space.
In 2001, the HRA entered into a Contract for Private Development and agreed to provide tax increment
assistance to the property and to issue tax increment revenue notes to reimburse development c osts.
This District has two Pay-Go Notes. Note A is a Tax Exempt Note held by BMO Harris Bank N.A. and Note B is
a Taxable Note held by W oodlake Partners LLC. Both notes were issued in 2001 and mature in 2026.
Pine Investments, LLC owns multi-family housing rental property in the Distric t. They are seeking to
refinanc e their debt and before issuing the loan, their Lender is requiring the Ric hfield Housing and
Redevelopment Authority (HRA) and BMO Harris, the Holder of Note A, to approve a Subordination
Agreement.
RECOM MENDED ACT ION:
By Motion: Appr ove a resolution approving a Subordination Agreement related to Richfield Urban
Village.
BASIS OF RECOM M ENDAT ION:
A.HISTORICAL CONTEXT
The Urban Village Tax Inc rement District was established in July 1999.
The HRA entered into a Contract for Private Redevelopment to provide assistance to the property
in 2001.
Two Pay-Go Notes were issued in 2001 and mature in 2026.
Pines Investments, LLC, which owns multifamily property in the Distric t, is seeking to refinance
their debt.
The Lender is requiring the HRA and the Holder of Note A to approve a subordination prior to
issuing the loan.
B.POLICIES (resolutions, ordinances, regulations, statutes, etc):
The Lender is requiring the HRA to approve a Subordination Agreement prior to issuing a loan to
Pines Investment, LLC.
C.CRITICAL TIMING ISSUES:
Pine Investments, LLC is anticipating to c lose on their refinancing by the end of Marc h. Prior to
making the loan, their Lender is requiring a Subordination Agreement from the HRA and BMO
Harris.
D.FINANCIAL IMPACT:
There is no financial impac t to the HRA.
E.LEGAL CONSIDERATION:
The resolution was drafted and Subordination Agreement was reviewed by HRA legal counsel.
ALTERNATIVE RECOMMENDATION(S):
Deny the subordination request.
PRINCIPAL PARTIES EXPECTED AT MEETING:
N/A
ATTACHMENTS:
Description Type
Resoluti on Resolution Letter
496221v1 JAE RC125-182
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD, MINNESOTA
RESOLUTION NO. ______
RESOLUTION APPROVING SUBORDINATION AGREEMENT RELATED TO RICHFIELD
URBAN VILLAGE
WHEREAS, Pines Investments, L.L.C., a Minnesota limited liability company (the “Developer”),
owns certain property located in the City of Richfield, Minnesota (the “Property”), upon which a multifamily
housing rental housing project (Richfield Urban Village) has been constructed; and
WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota
(the “Authority”), entered into an Amended and Restated Contract for Private Redevelopment, dated
May 21, 2001, with Richfield State Agency, Inc. (as predecessor to the Borrower), as amended pursuant to
the First Amendment to Amended and Restated Contract for Private Redevelopment, dated January 25, 2005,
between the Authority and Marshall & Ilsley Corporation (as successor by merger to Richfield State Agency,
Inc.), as affected by the Assignment and Assumption of Amended and Restated Contract for Private
Redevelopment, dated January 25, 2005, from Marshall & Ilsley Corporation to Woodlake-VEF IV, LLC,
and as further affected by Assignment and Assumption of Amended and Restated Contract for Private
Redevelopment, dated January 31, 2014, from Woodlake-VEF IV, LLC to Woodlake Partners, LLC
(collectively, the “Contract”), pursuant to which the Authority agreed to provide tax increment financing
assistance to the Property and surrounding property and to issue tax increment revenue notes to reimburse the
development costs in connection therewith; and
WHEREAS, NorthMarq Capital, LLC, a Minnesota limited liability company (the “Lender”), has
agreed to make a loan to the Developer in the amount of $8,050,000 (the “Loan”) pursuant to a Multifamily
Loan and Security Agreement (the “Loan Agreement”) between the Lender and the Borrower; and
WHEREAS, BMO Harris Bank N.A., a national banking association (“BMO”), is the holder of the
Tax Increment Revenue Note Series 2001A (the “TIF Note”), issued by the Authority on October 17, 2001,
in the original principal amount of $2,500,000; and
WHEREAS, prior to making the Loan, the Lender has required that the Authority subordinate its
interests under the Contract and that BMO subordinate its interest under the TIF Note to the interests of the
Lender under the Loan Agreement and the Loan Documents defined therein; and
WHEREAS, there has been presented before this Board a form of Subordination Agreement –
Governmental Entity (the “Subordination Agreement”) proposed to be entered into between the Authority,
BMO, and the Lender, which sets forth the terms of the Authority’s and BMO’s subordination of their
respective interests to the interests of the Lender; and
NOW, THEREFORE, BE IT RESOLVED, by the Board of Commissioners of the Housing and
Redevelopment Authority in and for the City of Richfield, Minnesota as follows:
1. The Subordination Agreement is hereby in all respects authorized, approved, and confirmed,
and the Chair and the Executive Director are hereby authorized and directed to execute the Subordination
Agreement for and on behalf of the Authority in substantially the form now on file with the Community
Development Director but with such modifications as shall be deemed necessary, desirable, or appropriate,
the execution thereof to constitute conclusive evidence of their approval of any and all modifications therein.
2
496221v1 JAE RC125-182
2. The Chair and the Executive Director are hereby authorized to execute and deliver any and
all documents deemed necessary to carry out the intentions of this resolution and the Subordination
Agreement.
Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota
this 20 th day of March, 2017.
Mary Supple, Chair
ATTEST:
Doris Rubenstein, Secretary
AGENDA SECTION:RESOLUTIONS
AGENDA ITEM #5.
STAFF REPORT NO. 15
HOUSING AND REDEVELOPMENT AUT HORIT Y
MEET ING
3/20/2017
REPORT PREPARED BY: Karen Barton, C ommunity Development Assistant Director
DEPARTMENT D IRECTOR REVIEW: John Stark, C ommunity Development Director
3/15/2017
OTHER DEPARTMENT REVIEW: N/A
CITY MANAGER REVIEW: Steven L. Devich, Executive Director
3/16/2017
IT EM FOR COUNCIL CONSIDERAT ION:
Consideration of the approval of a resolution approving the Assignment and Assumption of Contract
between Mesaba Capital Development, LLC, RM Senior Living Richfield LLC, and the Housing and
Redevelopment Authority, and Second Amendment to Contract for Private Development between RM
Senior Living Richfield LLC and the Housing and Redevelopment Authority.
EXECUT IVE SUM M ARY:
On February 16, 2016, Mesaba Capital Development, LLC entered into a Contract for Private Development
with the Richfield Housing and Redevelopment Authority (HRA) for the development of the former c ity garage
property (76th Street and Pillsbury Avenue) with 88 units of senior housing. Mesaba is requesting to
assign their obligations under the Contract to RM Senior Living Richfield LLC. RM Senior Living
Richfield is a subsidiary of Mesaba Capital Development and Roers Investments. RM Senior Living
Richfield is partnering with Avinity to operate the development after completion.
Section 8.2 of the Contract allows for Mesaba to assign its rights and duties under the Contract to another
entity with the approval of the HRA, if: (a) the proposed transferee has the qualifications and financial
responsibility, in the reasonable judgement of the HRA, necessary and adequate to fulfill the
obligations undertaking in the Contract Agreement; and (b) the proposed transferee expressly
assumes all of the obligations under the Contract and agrees to be subject to all of the conditions
and restrictions to which Mesaba is subject to.
Staff has vetted RM Senior Living Richfield and feels that the c ompany has the qualific ations and financial
capability to fulfill the obligations in the Contract.
Additionally, Mesaba/RM Senior Living Richfield is requesting a Sec ond Amendment to modify the terms of
the Contract to allow for full pay ment of the purc hase pric e of $1,219,000 at the time of closing.
RECOM MENDED ACT ION:
By Motion: Appr ove a resolution approving Assignment and Second Amendment to Contract for
Private Development with RM Senior Living Richfield, LLC.
BASIS OF RECOM M ENDAT ION:
A.HISTORICAL CONTEXT
The HRA entered into a Contract for Private Development with Mesaba Capital Development, LLC
on February 16, 2016, for the development of the former c ity garage property with 88 units of
senior housing.
Sec tion 3.2(c) of the original Contract provided for $975,000 of the purchase price to be paid at
Closing, with the balance of $244,000 to be paid through Tax Increment Financ ing.
A First Amendment to the Contract for Private Development was approved on November 22, 2016,
extending the closing date to on or before March 31, 2017.
Avinity will operate the fac ility upon c ompletion. Avinity c urrently operates Mainstreet Village senior
housing at 76th Street and Lyndale Avenue in Richfield.
Closing is sc heduled to oc cur on Marc h 27, 2017.
Construction is antic ipated to begin around May 1, 2017 and be c ompleted in late 2018.
B.POLICIES (resolutions, ordinances, regulations, statutes, etc):
2008 Comprehensive Plan Goal: Ensure sufficient diversity in the housing stock to provide for a
range of household sizes, income levels and needs.
2008 Comprehensive Plan Policies: Promote additional housing diversity to serve families at all
stages of their life-cycle
C.CRITICAL TIMING ISSUES:
The First Amendment to the Contrac t requires closing to oc cur on or before Marc h 31, 2017.
Closing is sc heduled for March 27, 2017.
D.FINANCIAL IMPACT:
Purc hase pric e of $1,219,000 will be paid at closing.
The City and HRA have pledged up to $2,400,000 in pay-go Tax Inc rement Financing, based on
qualified c osts.
E.LEGAL CONSIDERATION:
The HRA Attorney has drafted the Assignment and Assumption of Contrac t and the Second
Amendment to Contrac t for Private Development.
ALTERNATIVE RECOMMENDATION(S):
Do not approve the Assignment and Assumption of Contract.
PRINCIPAL PARTIES EXPECTED AT MEETING:
Representatives of the Developer
ATTACHMENTS:
Description Type
Resoluti on Resolution Letter
Mesaba CPD Assignment and Assumption Contract/Agreement
Mesaba CPD Second Amendment Contract/Agreement
Error! Bookmark not defined.
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD, MINNESOTA
RESOLUTION NO. ______
RESOLUTION APPROVING ASSIGNMENT AND SECOND AMENDMENT TO CONTRACT
FOR PRIVATE DEVELOPMENT WITH RM SENIOR LIVING RICHFIELD LLC
BE IT RESOLVED By the Board of Commissioners (the “Board”) of the Housing and
Redevelopment Authority in and for the City of Richfield, Minnesota (the “Authority”) as follows:
WHEREAS, the Authority owns certain real property located within Tax Increment Financing
District No. 2014-1 (City District Garage Site) (the “Development Property”), which was created within the
Richfield Redevelopment Project (the “Redevelopment Project”) in the City of Richfield, Minnesota (the
“City”); and
WHEREAS, Mesaba Capital Development, LLC, a Minnesota limited liability company (the
“Developer”), has proposed to construct a multifamily housing development with 88 units designed for
seniors, including approximately 60 assisted living units and 28 memory care units (the “Minimum
Improvements”), on the Development Property; and
WHEREAS, in order to promote the redevelopment of land that is underused and underutilized in the
City, the Authority has agreed to convey the Development Property and provide the Tax Increment Limited
Revenue Note, Series 2016 (“TIF Note”) to the Developer for the purpose of reimbursing the Developer for
certain costs of constructing the Minimum Improvements thereon; and
WHEREAS, the Authority and the Developer have previously entered into a Contract for Private
Development, dated February 16, 2016, which was amended by the First Amendment to Contract for Private
Development, dated November 22, 2016, (collectively, the “Original Agreement”), in order to set forth the
terms of the conveyance of the Development Property and TIF Note to the Developer and the Developer’s
construction of the Minimum Improvements; and
WHEREAS, there has been presented before this Board an Assignment and Assumption of Contract
(the “Assignment”), pursuant to which the Developer proposes to assign its interest in the Original
Agreement to RM Senior Living Richfield LLC, a limited liability company; and
WHEREAS, there has been presented before this Board a Second Amendment to Contract for
Private Development (the “Second Amendment”) proposed to be entered into between the Authority and the
Developer, which will amend and supplement the Original Agreement to modify certain provisions of the
Original Agreement, including but not limited to the provisions with respect to the payment of the purchase
price for the Development Property to the Authority by the Developer; and
WHEREAS, the Board is satisfied that the terms of the Assignment and the Second Amendment
carry out the intentions of the parties and are necessary and appropriate.
NOW, THEREFORE, BE IT RESOLVED, by the Board of Commissioners of the Housing and
Redevelopment Authority in and for the City of Richfield, Minnesota that:
1. The proposed Assignment is hereby approved in all respects.
Error! Bookmark not defined.
2. The proposed Second Amendment is hereby approved in all respects.
3. The Chair and Executive Director are hereby authorized to execute and deliver the
Assignment and the Second Amendment in substantially the form on file with the Authority, with such
additions, deletions, and other changes as are approved by the Chair and Executive Director. The Chair and
Executive Director are further directed to take all steps and do all things necessary to effectuate the
provisions of the Assignment and the Second Amendment.
Adopted by the Housing and Redevelopment Authority in and for the City of Richfield,
Minnesota this 20 th day of March, 2017.
Mary B. Supple, Chair
ATTEST:
Doris Rubenstein, Secretary
Error! Bookmark not defined.
Third Draft
March 15, 2017
ASSIGNMENT AND ASSUMPTION OF CONTRACT
THIS ASSIGNMENT AND ASSUMPTION OF CONTRACT, made as of March ___, 2017 (the
“Assignment”), is by and between MESABA CAPITAL DEVELOPMENT, LLC, a Minnesota limited
liability company (the “Assignor”), RM SENIOR LIVING RICHFIELD LLC, a Delaware limited
liability company (the “Assignee”), and the HOUSING AND REDEVELOPMENT AUTHORITY IN
AND FOR THE CITY OF RICHFIELD, MINNESOTA, a public body corporate and politic of the State
of Minnesota (the “Authority”).
RECITALS
The Assignor and the Authority are parties to that certain Contract for Private Development,
dated as of February 16, 2016, which was amended by the First Amendment to Contract for Private
Development, dated November 22, 2016 (collectively, the “Contract”), pursuant to which the Authority
agreed to convey to the Developer land, legally described in EXHIBIT A, and reimburse the Developer
for a portion of the land acquisition costs and certain site improvement costs related to the construction of
a multifamily housing development with 88 units designed for seniors, including approximately 60
assisted living units and 28 memory care units.
The Assignor desires to assign to the Assignee all of its interest in the Contract and its rights and
obligations under the Contract, and the Assignee desires to assume such interest in the Contract and the
rights and obligations under the Contract.
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties agree as follows:
1. Definitions. All capitalized terms not defined herein shall have the meanings given such
terms in the Contract.
2. Assignment and Assumption of Contract. Section 8.2 of the Contract allows the
Assignor to assign its rights and duties under the Contract to another entity if: (a) the proposed transferee
has the qualifications and financial responsibility, in the reasonable judgment of the Authority, necessary
and adequate to fulfill the obligations undertaken in the Contract Agreement by the Assignor; and (b) any
proposed transferee expressly assumes all of the obligations of the Assignee under the Contract and
agrees to be subject to all the conditions and restrictions to which the Assignor is subject to. The
Assignor hereby assigns to the Assignee all of its interest in the Contract and its rights and obligations
under the Contract. The Assignee hereby accepts such rights and assumes such obligations, subject to the
terms of this Assignment. The Authority acknowledges and consents to such assignment.
3. Covenants of the Assignee. The Assignee expressly assumes all of the obligations of the
Assignor under the Contract and agrees to be subject to all the conditions and restrictions to which the
Assignor is subject to under the Contract.
4. Release of Assignor. This Assignment shall be deemed to release and discharge the
Assignor from any obligations of the “Developer” under the Contract, such obligations having been
assumed by the Assignee.
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495634v4
5. Assignee Address. For purposes of notice under the Contract, the Assignee’s address is:
RM Senior Living Richfield LLC
__________________________
__________________________
Attn:______________________
6. Governing Law. It is agreed that this Assignment shall be governed by, construed and
enforced in accordance with the laws of the State of Minnesota.
7. Entirety of Agreement. This Assignment shall constitute the entire agreement between
the parties and any prior understanding or representation of any kind preceding the date of this
Assignment shall not be binding upon either party except to the extent incorporated in this Assignment.
8. Modification. Any modification of this Assignment or additional obligation assumed by
either party in connection with this Assignment shall be binding only if placed in writing and signed by
each party or an authorized representative of each party.
9. Execution in Counterparts. This Assignment may be executed, acknowledged and
delivered in any number of counterparts and each of such counterparts shall constitute an original but all
of which together shall constitute one agreement.
(The remainder of this page is intentionally left blank.)
S-1
495634v4 JAE RC125-347
IN WITNESS WHEREOF, the Assignor, the Assignee, and the Authority have caused this
Assignment and Assumption of Contract to be executed as of the date and year first written above.
ASSIGNOR :
MESABA CAPITAL DEVELOPMENT, LLC, a
Minnesota limited liability company
By:
Name: Robert Nickoloff
Title: Managing Partner
STATE OF MINNESOTA )
) SS
COUNTY OF __________ )
The foregoing instrument was acknowledged before me this ____ day of March, 2017, by Robert
Nickoloff, the Managing Partner of Mesaba Capital Development, LLC, a Minnesota limited liability
company, on behalf of the Assignor.
Notary Public
S-2
495634v4 JAE RC125-347
Execution page of the Assignee to the Assignment and Assumption of Contract, dated as of the date and
year first written above.
ASSIGNEE :
RM SENIOR LIVING RICHFIELD LLC , a
Delaware limited liability company
By:
Name:
Title:
STATE OF MINNESOTA )
) SS
COUNTY OF __________ )
The foregoing instrument was acknowledged before me this ____ day of March, 2017, by
_______________________________, the ____________________ of RM Senior Living Richfield LLC,
a Delaware limited liability company, on behalf of the Assignee.
Notary Public
[Notarial Stamp]
This instrument drafted by:
Kennedy & Graven, Chartered (JAE)
470 U.S. Bank Plaza
200 South Sixth Street
Minneapolis, MN 55402
612-337-9300
S-3
495634v4 JAE RC125-347
Execution page of the Authority to the Assignment and Assumption of Contract, dated as of the date and
year first written above.
AUTHORITY:
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
RICHFIELD, MINNESOTA
By
Its Chair
By
Its Executive Director
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this _____ day of March, 2017, by Mary
B. Supple, the Chair of the Housing and Redevelopment Authority in and for the City of Richfield,
Minnesota, on behalf of the Authority.
Notary Public
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this _____ day of March, 2017, by
Steven L. Devich, the Executive Director of the Housing and Redevelopment Authority in and for the
City of Richfield, Minnesota, on behalf of the Authority.
Notary Public
A-1
495634v4 JAE RC125-347
EXHIBIT A
LEGAL DESCRIPTION OF LAND
Tract A:
The West 30 feet of Lot 1, Block 4, "R.C. Soens Addition" according to the recorded plat thereof,
Hennepin County, Minnesota.
Being Registered land as is evidenced by Certificate of Title No. 1419539.
Tract B:
Parcel 1: Lot 1, Block 4, "R.C. Soens Addition" according to the recorded plat thereof, Hennepin
County, Minnesota, except the East 121.99 feet and except the West 30 feet thereof.
Parcel 2: Lot 2 except the East 121.99 feet thereof, Block 4, "R.C. Soens Addition" according to
the recorded plat thereof, Hennepin County, Minnesota.
Parcel 3: The North 75 feet of Lot 3, Block 4, "R.C. Soens Addition" according to the recorded
plat thereof, Hennepin County, Minnesota, except the East 121.99 feet thereof.
Being Registered land as is evidenced by Certificate of Title No. 1318698.
Tract C:
The East 121.99 feet of Lot 2, Block 4, "R.C. Soens Addition" according to the recorded plat thereof,
Hennepin County, Minnesota.
Being Registered land as is evidenced by Certificate of Title No. 1023869.
Tract D: Lot 3 except the North 75 feet thereof and Lots 4 and Lot 5; all in Block 4, R.C. Soens Addition,
Hennepin County, Minnesota.
Being Registered land as is evidenced by Certificate of Title No. 1418473 (also covers other land).
Tract E: The East 121.99 feet of Lot 1, Block 4, "R.C. Soens Addition" according to the recorded plat
thereof, Hennepin County, Minnesota.
Being Registered land as is evidenced by Certificate of Title No. 1361790.
1
Error! Bookmark not defined.
Second Draft
March 15, 2017
SECOND AMENDMENT TO CONTRACT FOR PRIVATE DEVELOPMENT
THIS SECOND AMENDMENT TO CONTRACT FOR PRIVATE DEVELOPMENT, made as of
the ____ day of March, 2017 (the “Second Amendment to Agreement”), is by and between the HOUSING
AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, MINNESOTA, a
public body corporate and politic under the laws of the State of Minnesota (the “Authority”), and RM
SENIOR LIVING RICHFIELD LLC, a Delaware limited liability company (the “Developer”).
WITNESSETH:
WHEREAS, the Authority was created pursuant to Minnesota Statutes, Sections 469.001 to 469.047,
as amended (the “HRA Act”) and was authorized to transact business and exercise its powers by a resolution
of the City Council of the City of Richfield (“City”); and
WHEREAS, the Authority has undertaken a program to promote redevelopment and development of
land that is underused or underutilized within the City, and in this connection the Authority administers a
redevelopment project known as the Richfield Redevelopment Project (“Redevelopment Project”) pursuant
to the HRA Act; and
WHEREAS, pursuant to the HRA Act, the Authority is authorized to acquire real property, or
interests therein, and to undertake certain activities to facilitate the redevelopment of real property by private
enterprise and promote the development of affordable housing within the City; and
WHEREAS, within the Redevelopment Project, the Authority has created the Tax Increment
Financing District No. 2014-1 (City District Garage Site) (“TIF District”) in order to facilitate redevelopment
of certain property in the Redevelopment Project and promote the development of affordable housing within
the City; and
WHEREAS, the Developer proposes to acquire certain property from the Authority (the
“Development Property”) within the TIF District and construct a multifamily housing development with 88
units designed for seniors, including approximately 60 assisted living units and 28 memory care units (the
“Minimum Improvements”); and
WHEREAS, in order to achieve the objectives of the Redevelopment Plan for the Redevelopment
Project and make the Minimum Improvements economically feasible for the Developer to construct, the
Authority has agreed to convey the Development Property to the Developer and reimburse the Developer for
a portion of the land acquisition costs and certain site improvement costs related to the Minimum
Improvements; and
WHEREAS, the Authority and Mesaba Capital Development, LLC entered into a Contract for
Private Development, dated February 16, 2016, which was amended by the First Amendment to Contract for
Private Development, dated November 22, 2016, and assigned to RM Senior Living Richfield LLC by the
Assignment of Contract for Private Development, dated March __, 2017, (collectively, the “Original
Agreement”) in order to set forth the terms of the conveyance by the Authority of the Development Property
(as legally described in Exhibit A attached thereto) to the Developer and the Developer’s construction of the
Minimum Improvements; and
2
Error! Bookmark not defined.
WHEREAS, the Authority and the Developer are entering into this Second Amendment to
Agreement, which amends and supplements the Original Agreement, to modify certain provisions of the
Original Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties
hereto, each of them does hereby covenant and agree with the other as follows:
ARTICLE I
Amendments
Section 1.1. Amendments to Section 3.2(c) of Original Agreement. Section 3.2(c) of the Original
Agreement is hereby deleted and replaced with the following:
(c) The Developer acknowledges that the Authority will be conveying the Development
Property to the Developer for a purchase price of $1,219,000 (the “Development Property Purchase
Price”). The Closing shall occur on or before March 31, 2017, at which time the Developer shall pay
the Authority the Development Property Purchase Price, less the earnest money to be deposited with
the Authority pursuant to Section 3.2(f) hereof.
ARTICLE II
Miscellaneous
Section 2.1. Definitions. Any capitalized terms used herein but not otherwise defined shall have the
meanings assigned to such terms in the Original Agreement. Any references to the “Agreement” or “this
Agreement” in the Original Agreement shall refer to the Original Agreement, as amended and supplemented
by this Second Amendment to Agreement and as may be further amended and supplemented.
Section 2.2. Effective Date. The amendments and supplements made to the Original Agreement, as
amended and supplemented by this Second Amendment to Agreement, shall be effective as of March ___,
2017.
Section 2.3. Additional Deposit for Administrative Costs. On the Effective Date of this First
Amendment to Agreement, the Developer has deposited an additional $_______ with the Authority to
reimburse the Authority for Administrative Costs pursuant to the provisions of Section 3.6 of the Original
Agreement.
Section 2.4. Confirmation of Agreement. Except as specifically amended by this Second
Amendment to Agreement, the Original Agreement is hereby ratified and confirmed, and remains in full
force and effect.
(The remainder of this page is intentionally left blank.)
495463v2 JAE RC125-347 S-1
IN WITNESS WHEREOF, the Authority has caused this Second Amendment to Contract for Private
Development to be duly executed in its name and behalf and its seal to be hereunto duly affixed and the
Developer has caused this Second Amendment to Contract for Private Development to be duly executed in its
name and behalf as of the date first above written.
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD,
MINNESOTA
By
Its Chair
(SEAL)
By
Its Executive Director
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this _____ day of March, 2017, by Mary B.
Supple, the Chair of the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota,
on behalf of the Authority.
Notary Public
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this _____ day of March, 2017, by Steven L.
Devich, the Executive Director of the Housing and Redevelopment Authority in and for the City of Richfield,
Minnesota, on behalf of the Authority.
Notary Public
This document was drafted by:
KENNEDY & GRAVEN, Chartered (JAE)
470 U.S. Bank Plaza
200 South Sixth Street
Minneapolis, Minnesota 55402
Telephone: 612-337-9300
495463v2 JAE RC125-347 S-2
RM SENIOR LIVING RICHFIELD LLC
By
Its __________________________________
STATE OF MINNESOTA )
) SS.
COUNTY OF __________ )
The foregoing instrument was acknowledged before me this _____ day of March, 2017, by
________________, the _____________________________ of the Developer, on behalf of the Developer.
Notary Public
(Signature Page of Developer to the Second Amendment to Contract for Private Development)
495463v2 JAE RC125-347 A-1
EXHIBIT A
Tract A:
The West 30 feet of Lot 1, Block 4, "R.C. Soens Addition" according to the recorded plat thereof, Hennepin
County, Minnesota.
Being Registered land as is evidenced by Certificate of Title No. 1419539.
Tract B:
Parcel 1: Lot 1, Block 4, "R.C. Soens Addition" according to the recorded plat thereof, Hennepin
County, Minnesota, except the East 121.99 feet and except the West 30 feet thereof.
Parcel 2: Lot 2 except the East 121.99 feet thereof, Block 4, "R.C. Soens Addition" according to the
recorded plat thereof, Hennepin County, Minnesota.
Parcel 3: The North 75 feet of Lot 3, Block 4, "R.C. Soens Addition" according to the recorded plat
thereof, Hennepin County, Minnesota, except the East 121.99 feet thereof.
Being Registered land as is evidenced by Certificate of Title No. 1318698.
Tract C:
The East 121.99 feet of Lot 2, Block 4, "R.C. Soens Addition" according to the recorded plat thereof,
Hennepin County, Minnesota.
Being Registered land as is evidenced by Certificate of Title No. 1023869.
Tract D: Lot 3 except the North 75 feet thereof and Lots 4 and Lot 5; all in Block 4, R.C. Soens Addition,
Hennepin County, Minnesota.
Being Registered land as is evidenced by Certificate of Title No. 1418473 (also covers other land).
Tract E: The East 121.99 feet of Lot 1, Block 4, "R.C. Soens Addition" according to the recorded plat thereof,
Hennepin County, Minnesota.
Being Registered land as is evidenced by Certificate of Title No. 1361790.
AGENDA SECTION:OTHER BUSINESS
AGENDA ITEM #6.
STAFF REPORT NO. 16
HOUSING AND REDEVELOPMENT AUT HORIT Y
MEET ING
3/20/2017
REPORT PREPARED BY: Julie Urban, Housing Specialist
DEPARTMENT D IRECTOR REVIEW: John Stark, C ommunity Development Director
2/14/2017
OTHER DEPARTMENT REVIEW: N/A
CITY MANAGER REVIEW: Steven L. Devich, Executive Director
2/15/2017
IT EM FOR COUNCIL CONSIDERAT ION:
Consideration of the approval of a Contract for Private Development between the Housing and
Redevelopment Authority and Endres Custom Homes, Inc. for the redevelopment of 6836 Irving Avenue
under the Richfield Rediscovered Credit Pr ogram.
EXECUT IVE SUM M ARY:
Endres Custom Homes, Inc. (the Builder) is applying for a Richfield Rediscovered Credit to assist in
purchasing the property at 6836 Irving Avenue. The Builder would remove the existing substandard home and
construct a new home for a homeowner on the lot. This homeowner has entered into an Agreement with the
Builder. Upon completion, the Housing and Redevelopment Authority (HRA) would issue the $50,000 c redit.
The new home would be a two-story home with three bedrooms, three bathrooms, and a detac hed two-car
garage. The new home will be 2,120 square feet with a minimum end-value of $390,000.
RECOM MENDED ACT ION:
By Motion: Appr ove and authoriz e execution of a Contract for Private Development between the
Housing and Redevelopment Authority and Endres Custom Homes, Inc. for the redevelopment of 6836
Irving Avenue thr ough the Richfield Rediscover ed Credit Program.
BASIS OF RECOM M ENDAT ION:
A.HISTORICAL CONTEXT
The existing one-bedroom, 572 square-foot house, built in 1939, has been inspected and qualifies
as substandard, per the program guidelines.
Prospec tive Richfield Rediscovered Credit Program partic ipants bear a significant cost in
redeveloping developed lots. The $50,000 redevelopment subsidy addresses the financing gap and
provides an attractive inc entive to replace a substandard housing struc ture with a new home that
meets the needs and desires of today's households.
The Builder has a purchase agreement on the house.
The Builder has a contract with an end-buyer for the house.
B.POLICIES (resolutions, ordinances, regulations, statutes, etc):
The proposed project meets the objectives of the Ric hfield Redisc overed Program by:
removing substandard, functionally obsolete housing and eliminates its blighting influence;
providing new, higher valued housing;
alleviating the shortage of housing c hoices for families; and,
fac ilitating the HRA's "Marekt Rate Initiatives" by providing owner-occ upied houses designed for
families.
The projec t meets the Housing Design and Site Development Criteria, as defined in the Richfield
Rediscovered Guidelines. Several features are inc orporated to address the design c riteria:
The house will be set bac k 36 feet from the front property line, consistent with the adjacent
houses.
The side setbac ks will be 17 feet.
C.CRITICAL TIMING ISSUES:
The Contract requires the Builder to c lose on the property by April 30, 2017, and to c omplete
construc tion by September 30, 2017.
D.FINANCIAL IMPACT:
Under the terms of the Contract, the $50,000 will be distributed in one payment, due and payable
upon completion of construction.
The 2017 Ric hfield Redisc overed budget allows for up to two credit developments.
E.LEGAL CONSIDERATION:
The HRA Attorney reviewed the terms of the Contract for Private Development.
Public notification is not required; however, notice of the meeting was sent to nearby property
owners as a courtesy.
ALTERNATIVE RECOMMENDATION(S):
Alternatively, the HRA may choose to:
Not execute the Contract for Private Development and direc t staff how to proceed; or,
Amend the Contract for Private Development and direc t staff to work with the Builder to revise the
proposal.
PRINCIPAL PARTIES EXPECTED AT MEETING:
Dustin Endres, Endres Custom Homes, Inc.
ATTACHMENTS:
Description Type
Contract for Private Development, 6836 Irvi ng Contract/Agreement
Photo of 6836 Irving Exhibit
Elevations Exhibit
Landscape-Si te Plan Exhibit
410517v2 JAE RC125-65
CONTRACT FOR PRIVATE DEVELOPMENT
Between
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD
and
Endres Custom Homes, Inc.
Related to Property Located at
6836 Irving Avenue South
This Instrument Drafted by:
Housing and Redevelopment Authority
in and for the City of Richfield
6700 Portland Avenue South
Richfield, MN 55423
612-861-9760
1
410517v2 JAE RC125-65
CONTRACT FOR PRIVATE DEVELOPMENT
THIS AGREEMENT,made and entered into as of this ___day of _______________,
2017,by and between the Housing and Redevelopment Authority in and for the City of Richfield,
a public body corporate and politic under the laws of the State of Minnesota, having its principal
office at 6700 Portland Avenue, Richfield, Minnesota (HRA), and Endres Custom Homes, Inc.
(Buyer).
WITNESSETH:
WHEREAS, the City of Richfield (City) and the HRA have previously created and
established a Redevelopment Project (Project) pursuant to the authority granted in Minnesota
Statutes, Sections 469.001 through 469.047 (the Act); and
WHEREAS, pursuant to the Act, the City and the HRA have previously adopted a
redevelopment plan (Redevelopment Plan) to finance all or a portion of the public development
costs of the Project; and
WHEREAS, in order to achieve the objectives of the Redevelopment Plan and
particularly to make specified land in the Project available for development by private enterpri se
for and in accordance with the Redevelopment Plan, the HRA has determined to provide
substantial aid and assistance to finance development costs in the Project; and
WHEREAS, the Buyer has proposed a development as hereinafter defined within the
Project which the HRA has determined will promote and carry out the objectives for which the
Project has been undertaken, will assist in carrying out the obligations of the Redevelopment
Plan, will be in the vital best interests of the City and the health, safet y and welfare of its
residents and is in accord with the public purposes and provisions of the applicable state and
local laws and requirements under which development in the Project has been undertaken and is
being assisted.
NOW, THEREFORE, in consideration of the mutual covenants and obligation of the
HRA and the Buyer, each party does hereby represent, covenant and agree with the other as
follows:
ARTICLE I.
DEFINITIONS, EXHIBITS, RULES OF INTERPRETATION
Section 1.1.Definitions. In this Agreement, the following terms have the meaning
given below unless the context clearly requires otherwise:
Buyer.Endres Custom Homes, Inc.
City. The City of Richfield, Minnesota.
Closing. The date on which Buyer closes on the Purchase of the Property.
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410517v2 JAE RC125-65
Construction Plans.The construction plans approved by the HRA pursuant to
Section 4.1 of this Agreement. The Construction Plans include a schedule for construction of the
Improvements, preliminary plans and schematics of the Improvements to be constructed,and a
landscaping plan.
Development. The Property and the Improvements to be constructed thereon according
to the Construction Plans approved by the HRA.
Event of Default. Event of Default has the meaning given such term in Section 8.1.
Guidelines.The Richfield Rediscovered Program Guidelines for the Redevelopment
Credit Program,revised July 25, 2011 and attached as Exhibit A to this Agreement.
HRA. The Housing and Redevelopment Authority in and for the City of Richfield,
Minnesota.
Improvements. Each and all of the structures and site improvements constructed on the
Property by the Buyer, as specified in the Construction Plans approved by the HRA.
Minimum Market Value.$390,000, which is the minimum market value for the
Property and Improvements as confirmed by the Hennepin County Assessor.
Property. The real property legally described as:
Lot 8, Block 3,Wood Lake Highlands, Hennepin County, Minnesota
having a street address of:
6836 Irving Avenue South
Redevelopment Project or Project.The Redevelopment Project established by the
HRA pursuant to Minnesota Statutes Sections 469.001 through 469.047 and described in the
Redevelopment Plan.
Redevelopment Plan. The plans for implementation of the Redevelopment Project
adopted by the HRA pursuant to Minnesota Statutes Sections 469.001 through 469.047.
Unavoidable Delays. Delays which are the direct result of strikes, labor troubles, fire or
other casualty to the Improvements, litigation commenced by third parties which results in delays
or acts of any federal, state or local government, except those contemplated by this Agreement,
which are beyond the control of the Buyer.
Section 1.2 Exhibits. The following Exhibits are attached to and by reference made a
part of this Agreement:
A.Program Guidelines
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410517v2 JAE RC125-65
B.Certificate of Completion
Section 1.3 Rules of Interpretation.
(a)This Agreement shall be interpreted in accordance with and governed by the laws
of the State of Minnesota.
(b)The words “herein” and “hereof” and words of similar import, without reference
to any particular section or subdivision refer to this Agreement as a whole rather than any
particular section or subdivision hereof.
(c)References herein to any particular section or subdivision hereof are to the section
or subdivision of this Agreement as originally executed.
(d)Any titles of the several parts, articles and sections of this Agreement are inserted
for convenience and reference only and shall be disregarded in construing or interpreting any of
its provisions.
ARTICLE II.
REPRESENTATIONS AND UNDERTAKINGS
Section 2.1 By the Buyer. The Buyer makes the following representations and
undertakings:
(a)The Buyer has the legal authority and power to enter into this Agreement and has
duly authorized the execution, delivery and performance of this Agreement;
(b)The Buyer has the necessary equity capital or will obtain commitments for
financing necessary for construction of the Improvements;
(c)The Buyer will construct the Improvements in accordance with the terms of this
Agreement and all local, state and federal laws and regulations;
(d)The Buyer will obtain, in a timely manner, all required permits, licenses and
approvals, and will meet, in a timely manner, the requirements of all local, state and federal laws
and regulations which must be obtained or met before the Improvements may be constructed; and
(e)The plans for the Improvements have been prepared by a qualified draftsperson or
architect.
(f)The Buyer intends to reside at the Property following completion of construction
of the Improvements and is not acquiring the Property for the purpose of resale or speculation.
(g)The Buyer has read and understands the Guidelines and agrees to be bound by
them.
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410517v2 JAE RC125-65
Section 2.2 By the HRA. The HRA makes the following representations as the basis for
the undertaking on its part herein contained:
(a)The HRA is authorized by law to enter into this Agreement and to carry out its
obligations hereunder; and
(b)The HRA will, in a timely manner, subject to all notification requirements, review
and act upon all submittals and applications of the Buyer and will cooperate with the efforts of
Buyer to secure the granting of any permit, license, or other approval required to allow the
construction of the Improvements.
ARTICLE III.
ACQUISITION OF PROPERTY; CONVEYANCE TO BUYER
Section 3.1 Purchase of Property by Buyer. The Buyer has, or will utilize its best
efforts to enter into a binding agreement to purchase the Property. If no binding purchase
agreement is entered into within 30 days from the date of this Agreement, either the HRA or the
Buyer may declare this Agreement null and void, and the parties will thereby be released from
any further obligation hereunder.
Section 3.2 Closing.Closing on the Property must take place on or before April 30,
2017, or such other date as may be agreed to by the Buyer and the HRA in writing.
ARTICLE IV.
CONSTRUCTION OF IMPROVEMENTS
Section 4.1.Construction of Improvements.The Buyer shall submit to the HRA the
Construction Plans for approval by the HRA staff.The Buyer shall cause the Improvements to
be constructed on the Property in accordance with the Guidelines and the Construction Plans,
shall cause the Improvements to meet or exceed the Minimum Market Value, and shall maintain,
preserve and keep the Improvements in good repair and condition.
Section 4.2.Building Plans. No building permit will be issued by the City unless the
building plans are in conformity with the Guidelines contained in Exhibit A, the Construction
Plans,the required Minimum Market Value,other requirements contained in this Agreement, and
all local, state and federal regulations.The Buyer shall provide the HRA with a set of building
plans to be used in connection with any application for a building permit.The HRA shall, within
25 days of receipt of the building plans submitted in application for a building permit, review
such building plans to determine whether the foregoing requirements have been met. If the HRA
determines such building plans to be deficient, it shall notify the Buyer in writing stating the
deficiencies and the steps necessary for correction. Issuance of the building permit by the City
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410517v2 JAE RC125-65
shall be a conclusive determination that the building plans have been approved and shall satisfy
the provisions of this Section 4.2.
Section 4.3 Schedule of Construction. Subject to Unavoidable Delays, construction of
the Improvements shall be completed prior to September 30, 2017. All construction shall be in
conformity with the approved Construction Plans and the Guidelines. Periodically during
construction the Buyer shall make reports in such detail as may reasonably be requested by the
HRA concerning the actual progress of construction. If at any time prior to completion of
construction the HRA has cause to believe that the Buyer will be unable to complete construction
of the Improvements in the time permitted by this Section 4.3, it may notify the Buyer and
demand assurances from the Buyer regarding the Buyer’s construction schedule. If such
assurances are not forthcoming or are deemed by the HRA at its sole discretion to be inadequate,
the HRA may declare an Event of Default and may avail itself of any of the remedies specified in
Section 8.2 of this Agreement.
Section 4.4 Certificate of Completion. Promptly after notification by the Buyer of
completion of construction of the Improvements, the HRA shall inspect the construction to
determine whether the Improvements have been completed in accordance with the Construction
Plans and the terms of this Agreement, including the date of the completion thereof. In the event
that the HRA is satisfied with the construction, the HRA shall furnish the Buyer with a
Certificate of Completion in the form attached hereto as Exhibit B.Such certification by the
HRA shall be a conclusive determination of satisfaction and termination of the agreements and
covenants in this Agreement with respect to the obligation of the Buyer to construct the
Improvements.
If the HRA shall refuse or fail to provide certification in accordance with the provisions
of this Section 4.4, the HRA shall within 15 days of such notification provide the Buyer with a
written statement, indicating in adequate detail in what respects the Buyer has failed to complete
the Improvements in accordance with the provisions of this Agreement necessary, in the opinion
of the HRA, for the Buyer to take or perform in order to obtain such certification.
Section 4.5 Failure to Construct. In the event that construction of the Improvements is
not completed as provided in Section 4.3 of this Agreement,an Event of Default shall be deemed
to have occurred, and the HRA may proceed with its remedies under Section 8.2.
ARTICLE V.
REDEVELOPMENT ASSISTANCE
Section 5.1 Redevelopment Credit.As consideration for the Buyer’s covenant to
construct the Improvements,and subject to all of the conditions of this Agreement,the HRA
agrees to provide the Buyer with a Redevelopment Credit in the amount of $50,000.If the Buyer
is in compliance with its obligations under this Agreement, the Redevelopment Credit will be
paid to the Buyer in one installment on the date of the issuance of a Certificate of Completion
evidencing that the Improvements have been completed, including the landscaping.
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ARTICLE VI.
FINANCING
Section 6.1 Financing. Within 20 days of the date of execution of this Agreement, the
Buyer shall submit to the HRA evidence of financing for the Improvements in compliance with
the provisions of Section 2.1(b) of this Agreement. If the HRA finds that the financing is
adequate in amount to provide for the construction of the Improvements, the HRA shall notify
the Buyer of its approval.
If the HRA rejects the evidence of financing as inadequate, the Buyer shall have 30 days
or such additional period of time as the Buyer may reasonably require from the date of such
notification to submit evidence of financing satisfactory to the HRA. If the Buyer fails to submit
such evidence or fails to use due diligence in pursuing financing, the HRA may terminate this
Agreement and both parties shall be released from any further obligation or liability hereunder,
except for the HRA’s remedies pursuant to Section 4.5 of this Agreement.
Section 6.2 Copy of Notice of Default to Lender. Whenever the HRA shall deliver any
notice or demand to the Buyer with respect to any Event of Default by the Buyer in its
obligations or covenants under this Agreement, the HRA shall at the same time forward a copy of
such notice or demand to each holder of any mortgage at the last address of such holder shown in
the records of the HRA.
ARTICLE VII.
PROHIBITIONS AGAINST ASSIGNMENT AND TRANSFER
Section 7.1 Representation as to Redevelopment.The Buyer represents and agrees
that its undertakings pursuant to the Agreement, are for the purpose of development of the
Property and not for speculation in land holding.The Buyer further recognizes that, in view of
the importance of the Development to the general welfare of Richfield and the substantial
financing and other public aids that have been made available by the HRA for the purpose of
making the Development possible, the qualification and identity of the Buyer are of particular
concern to the HRA. The Buyer further recognizes that it is because of such qualifications and
identity that the HRA is entering into this Agreement, and, in so doing, is further willing to rely
on the representations and undertakings of the Buyer for the faithful performance of all
undertakings and covenants agreed by the Buyer to be performed.
Section 7.2 Prohibition Against Transfer of Property and Assignment of
Agreement.
(a)The HRA and the Buyer acknowledge that in furtherance of construction of the
Improvements the Buyer may make an assignment of the property to the Construction Contractor,
with a reassignment of the property to the Buyer following completion of construction of the
Improvements.
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(b) Other than as provided above, no transfer of the Property or assignment of the
Agreement prior to the issuance of a Certificate of Completion will be permitted absent the
written approval of the HRA.
ARTICLE VIII.
EVENTS OF DEFAULT
Section 8.1 Events of Default Defined. The following shall be deemed Events of
Default under this Agreement and the term shall mean, whenever it is used in this Agreement,
unless the context otherwise provides, any one or more of the following events:
(a)Failure by the Buyer to pay when due the payments required to be paid or secured
under any provision of this Agreement;
(b)Failure by the Buyer to observe and substantially perform any covenant,
condition, obligation or agreement on its part to be observed or performed hereunder, including
the time for such performance;
(c)If the Buyer shall admit in writing its inability to pay its debts generally as they
become due, or shall file a petition in bankruptcy, or shall make an assignment for the benefit of
its creditors, or shall consent to the appointment of a receiver of itself or of the whole or any
substantial part of the Property;
(d)If the Buyer, on a petition in bankruptcy filed against it, be adjudicated as
bankrupt, or a court of competent jurisdiction shall enter an order or decree appointing, without
the consent of the Buyer, a receiver of the Buyer or of the whole or substantially all of its
property, or approve a petition filed against the Buyer seeking reorganization or arrangement of
the Buyer under the federal bankruptcy laws, and such adjudication, order or decree shall not be
vacated or set aside or stayed within 60 days from the date of entry thereof; or
(e)If the Buyer is in default under any mortgage recorded against the Property and
has not entered into a work-out agreement with the holder of the mortgage.
Section 8.2 Remedies on Default. Whenever any Event of Default occurs, the HRA
may, in addition to any other remedies or rights given the HRA under this Agreement, take any
one or more of the following actions following written notice by the HRA to the Buyer as
provided in Section 9.3 of this Agreement:
(a) Suspend its performance under this Agreement until it receives assurances from the
Buyer, deemed reasonably adequate by the HRA, that the Buyer will cure its default and continue
its performance under this Agreement;
(b) Cancel or rescind this Agreement;
(c) Withhold the Certificate of Completion; or
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(d) Take whatever action at law or in equity may appear necessary or desirable to the
HRA to enforce performance and observance of any obligation, agreement, or covenant of the
Buyer under this Agreement; provided, however, that any exercise by the HRA of its rights or
remedies hereunder shall always be subject to and limited by, and shall not defeat, render invalid
or limit in any way (a) the lien of any mortgage and (b) any rights or interest provided in this
Agreement for the protection of the holders of a mortgage; and provided further that should any
mortgagee succeed by foreclosure of the mortgage or deed in lieu thereof to the Buyer’s interest
in the Property, it shall, notwithstanding the foregoing, be obligated to perform the obligations of
the Buyer under this Agreement to the extent that the same have not therefore been performed by
the Buyer.
Section 8.3 No Remedy Exclusive. No remedy herein conferred upon or reserved to the
HRA is intended to be exclusive of any other available remedy or remedies, but each and every
such remedy shall be cumulative and shall be in addition to every other remedy given under this
Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to
exercise any right or power accruing upon any default shall impair any such right or power or
shall be construed to be a waiver thereof, but any such right and power may be exercised from
time to time and as often as may be deemed expedient. In order to entitle the HRA or the Buyer
to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such
notice as may be required in this Article VIII.
Section 8.4 No Additional Waiver Implied by One Waiver. In the event of the
occurrence of any Event of Default by either party, which Event of Default is thereafter waived
by the other party, such waiver shall be limited to the particular Event of Default so waived and
shall not be deemed to waive any other concurrent, previous or subsequent Event of Default.
ARTICLE IX.
ADDITIONAL PROVISIONS
Section 9.1 Conflict of Interests; Representatives Not Individually Liable. No HRA
officer who is authorized to take part in any manner in making this Agreement in his or her
official capacity shall voluntarily have a personal financial interest in this Agreement or benefit
financially there from. No member, official, or employee of the HRA shall be personally liable
to the Buyer, or any successor in interest, for any Event of Default by the HRA or for any amount
which may become due to the Buyer or successor or on any obligations under the terms of this
Agreement.
Section 9.2 Non-Discrimination. The provisions of Minnesota Statutes Section 181.59,
which relate to civil rights and non-discrimination, and any affirmative action program of the
City shall be considered a part of this Agreement and binding on the Buyer as though fully set
forth herein.
Section 9.3 Notices and Demands. Except as otherwise expressly provided in this
Agreement, a notice, demand or other communication under this Agreement by either party to the
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410517v2 JAE RC125-65
other shall be sufficiently given or delivered if it is sent by mail, postage prepared, return receipt
requested or delivered personally:
(a)As to the HRA:
Richfield HRA
Attn:Housing Specialist
6700 Portland Avenue South
Richfield, MN 55423
(b)As to the Buyer:
Dustin Endres
Endres Custom Homes, Inc.
155561 Dunberry Way
Apple Valley, MN 55124
or at such other address with respect to either such party as that party may, from time to time,
designate in writing and forward to the other as provided in this Section 9.3.
Section 9.4 Counterparts. This Agreement may be simultaneously executed in any
number of counterparts, all of which shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
as of the day and year first above written.
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
RICHFIELD, MINNESOTA
By _______________________________________
Its Chairperson
By _______________________________________
Its Executive Director
STATE OF MINNESOTA )
) SS
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this day of
, 2017,by Mary B. Supple,the Chairperson of the Housing and
Redevelopment Authority in and for the City of Richfield, Minnesota (HRA), a public body
corporate and politic under the laws of Minnesota, on behalf of the HRA.
________________________________________________
Notary Public
STATE OF MINNESOTA )
) SS
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this day of
, 2017,by Steven L. Devich, the Executive Director of the Housing and
Redevelopment Authority in and for the City of Richfield, Minnesota (HRA), a public body
corporate and politic under the laws of Minnesota, on behalf of the HRA.
________________________________________________
Notary Public
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BUYER
________________________________________
________________________________________
STATE OF MINNESOTA )
) SS
COUNTY OF ______________ )
The foregoing instrument was acknowledged before me this __________ day of
____________________, 2017, by __________________________.
________________________________________________
Notary Public
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EXHIBIT A
RICHFIELD REDISCOVERED
PROCEDURAL GUIDELINES
REDEVELOPMENT CREDIT PROGRAM
Revised: July 25, 2011
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PROGRAM OBJECTIVES ............................................................................................................................3
DEFINITIONS................................................................................................................................................3
PROGRAM BASICS .....................................................................................................................................3
APPLICATION REQUIREMENTS ................................................................................................................4
SECURING A SITE .......................................................................................................................................5
PROPERTY EVALUATION CONSIDERATIONS AND PROCEDURES......................................................5
HOUSE DESIGN AND SITE DEVELOPMENT REQUIREMENTS ..............................................................6
NEW HOME STANDARDS...........................................................................................................................6
SITE STANDARDS .......................................................................................................................................6
CONSTRUCTION REQUIREMENTS ...........................................................................................................6
GENERAL STANDARDS .............................................................................................................................7
GREEN COMMUNITY CONCEPTS .............................................................................................................8
DISBURSEMENT OF FUNDS ......................................................................................................................8
SOLICITATION OF NEW DEVELOPMENT PROPOSALS .........................................................................9
GENERAL PROGRAM MARKETING ..........................................................................................................9
DATA PRIVACY ............................................................................................................................................9
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This document has been developed as a guidance tool for program administration. It should not be
interpreted as constituting any contractual agreement or liability by the City or Housing and
Redevelopment Authority (HRA).
I.Program Objectives
To remove substandard, functionally obsolete housing on scattered sites throughout the
city with new, higher-valued housing
To eliminate the blighting influence of substandard housing, thus improving residential
neighborhoods.
To alleviate the shortage of housing choices for families.
To facilitate “Market Rate Initiatives” which include:
o Larger three-to four-bedroom, owner-occupied homes designed for families
These objectives will be achieved through the acquisition of property by private Buyers and the
development of newly constructed homes.
II.Definitions
Buyer: An individual(s) who will build, own and occupy a new single-family home in Richfield.
The Buyer will occupy the property and not offer it for rent. The Buyer may not also function as the Builder
on a Richfield Rediscovered project.The Buyer and Builder must be unrelated separate legal entities.A
speculative project by a Buyer may be considered if all other program requirements can be met.
However, neither the Buyer, the Buyer’s Builder or Builder’s subcontractors, or the Builder’s realty agents
may occupy or purchase the property.
Buyers, unless licensed in the trade specified, may not put any sweat equity into the construction of the
foundation, wall/roof framing, shingling, exterior work, electrical/plumbing/HVAC systems or interior
carpentry.
Builder: Contractor who has signed contract with the Buyer to build a single-family home on the lot
identified in the application.
Contract for Private Development: A contract between the HRA and the Buyer or Builder that establishes
the conditions under which the lot will be sold and the proposed house will be developed.
Green Community Concepts Plan: A written plan indicating how the proposed development will
incorporate green building features and concepts. Priority will be given to projects that incorporate green
building features.
HRA: Housing and Redevelopment Authority in and for the City of Richfield.
Seller: Owner of property identified as eligible by the HRA based on condition, size and marketability.
Redevelopment Credit: To offset costs of acquisition and demolition, a redevelopment credit of $50,000 is
available from the HRA for a Buyer who acquires the property directly from the seller for redevelopment.
III.Program Basics
Program is first-come, first-serve, subject to funding availability.
Buyer purchases property, hires builder to demolish existing structures and constructs a
new single-family home in conformance with program requirements.
A $50,000 Redevelopment Credit is available per completed property.
Projects must be completed within one year of HRA approval of the project.
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IV.Application Requirements
The following must be submitted for application to the program:
1.$525 application fee
An application fee, in the form of a certified cashier’s check made out to the Richfield
HRA, must be paid at the time of application. This fee is non-refundable.
2.Project Information Sheet
3.Purchase agreement
The Buyer must present a valid purchase agreement for the lot it proposes to redevelop.
The closing must be scheduled after the date the HRA approves the Contract.
4.Blueprints
The layout of all levels, including basement and unfinished space, must be provided.
5.Elevations
Elevations of all four sides of the house, including view of garage shall be provided.
6.Site plan
The site plan shall indicate the location of the new house, walkways and garage.
7.Landscaping plan
A landscaping plan may be hand-drawn by the applicants, but must indicate the location
and type of trees, shrubbery, flowers and landscaping materials (e.g. rocks, mulch).The
entire grounds shall be landscaped and be aesthetically pleasing in all seasons. Land
forms and plant materials shall be used to define the site and blend neatly with adjoining
properties. Specific lot line blending requirements may be required, as appropriate, for
specific sites.
8.Green Community Concepts Plan
The plan should indicate what Green Community Concepts will be incorporated into the
project.
9.Detail of construction materials to be used on the project.
10.Construction timeline
Construction must be completed with one year of the purchase of the property.
11.Signed contract with Builder
12.Financial capability statement
a.A statement from a financial institution indicating willingness, with standard contingencies,
to provide sufficient construction capital to complete the project.
13.Builder References
a.Five previous customers
b.Three major suppliers, one being the construction supplier
c.Building inspectors from two cities where the Builder has constructed new housing within
the past three years
14.Proof of Builder’s Comprehensive General Liability with Property Damage Protection.
15.Proof of sufficient worker’s compensation insurance coverage by the Builder.
16.Written warranty program
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a.To be provided to the Buyer, which guarantees at a minimum, warranted repairs as
required by Minnesota State Statute.
V.Securing a Site
Participants identify a property on their own or from a list of Richfield Rediscovered-eligible properties
provided by HRA staff. If the property has not already been qualified for the program, it must be evaluated
for substandardness or market obsolescence. Upon request of a prospective Buyer, HRA staff may
research the property, and arrange for a “Substandard Evaluation”to be conducted. An evaluator will
inspect the interior for substandard qualification.
The Buyer is responsible for negotiating with the Seller on a purchase price. Once a purchase agreement
between the Seller and Buyer has been signed, the Buyer should submit an application form and required
supporting documents.Only when HRA staff has received a complete application, can the $50,000
Redevelopment Credit be reserved. The reservation of funds is not an approval by the HRA. All
applications must be brought to the HRA at a regularly-scheduled meeting for approval.
VI.Property Evaluation Considerations and Procedures
Properties with the lowest market values, poorest visibility,and/or a history of code violations, will be
considered first for the program.
To be eligible for the Richfield Rediscovered program, a house must be structurally substandard and meet
at least of one of the criteria in Criteria A and all of Criteria B.
Criteria A
Obsolete design for block and area in which it is located.
Deteriorated to the point that it has caused blight to other adjoining properties.
Detrimental to the health or safety of abutting properties.
Less than $140,000 in value, as determined by the City of Richfield Assessing
Department.
Criteria B
Site can be developed with a new home within city code requirements, including
conformance with the Zoning Code and the Comprehensive Plan
Property does not cause negative impact on other redevelopment projects.
Redevelopment projects may include:
o Established commercial redevelopment areas
o Right-of-way improvement projects such as I-494, I-35W, Crosstown Highway 62,
TH 77 and 66th Street
o Negative airport noise zones
o Stormwater/flood prevention improvement projects
o Other, as determined by the HRA
At the request of an interested Buyer, staff will research the property and if it is believed that the property
may qualify for the Richfield Rediscovered program, a “Substandard Evaluation” will be arranged. An
evaluator will inspect the interior for substandard qualification.
If a property meets the substandard test during the independent “Substandard Evaluation”, application
procedures can continue. If the substandard test cannot be met, the property cannot be considered for
the Richfield Rediscovered program.
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At the discretion of staff, properties over 50 years old may also be required to be evaluated for historical
significance through the Minnesota Historical Society.
VII.House Design and Site Development Requirements
Housing design is a critical element of the program. Siding materials, exterior façade presentation, roof,
window, siding and building line variability, finished landscape, interior space function and use are all
important issues of design to the HRA. The criteria were created to ensure that the homes built on the
identified lots blend in with the surrounding neighborhood and respond to the specific concerns of the
HRA.
All new houses built under the Richfield Rediscovered Program must meet the requirements of the City’s
Zoning Code and additional criteria, as listed in this document.
The development of all sites shall meet the development criteria listed below, as reviewed and approved
by the HRA. To maximize the development of a given lot, the HRA reserves the right to explore all
development options without obligating the HRA to support any specific proposal, idea or solicitation.
A.New Home Standards
1.Existing buildings must be demolished. If an existing garage is in good condition, it may be
retained upon review by HRA staff and the Building Official.
2.New dwelling must be owner-occupied and single-family.
3.Three finished bedrooms are required.
4.Two finished bathrooms are required.
5.Two-car garage is required.
6.A full basement is required, unless the selected design results in a split-level or a garden-level
type of basement.In the case of an “accessible” house, a basement may be omitted if it would
otherwise prohibit accessible design elements.
B.Site Standards
1.After construction, the site must be fully landscaped, including plantings around the foundation.
The entire grounds shall be landscaped and be aesthetically pleasing in all seasons. Land forms
and plant materials shall be used to define the site and blend neatly with adjoining properties.
Specific lot line blending requirements may be required, as appropriate, for specific sites.
At a minimum, the applicant must meet the “Landscaping and Screening Requirements” in the
City’s Zoning Code under Section 544.03, Subd. 4,General landscaping requirements and Subd.
5,Residential sites. The code is available on the City’s website:http://www.cityofrichfield.org.
To the greatest extent possible, existing trees should be preserved.Any trees removed must be
replaced (they do not have to be the same species or in the same location) and should be
labeled on the required landscape plan.
2.Utility meters shall be screened from street view and locations must be specified on plans.
3.Site drainage should be accommodated on the site so that water is directed away from the new
home and the neighboring properties. Neighboring properties must not be disturbed by the
creation of drainage swales. Specific storm water management requirements may be required,
as appropriate, including the addition of gutters for specific sites. Construction and the finished
structure must not have detrimental impact on storm water drainage patterns in the
neighborhood.
4.All air conditioning units must be located in the rear yard of the house or as approved by the
HRA.
C. Construction Requirements
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1.Existing trees must be protected during construction. A tree wrap with board reinforcements
shall be sued on trees directly adjacent to active grading and construction area. Damaged or
destroyed trees must be replaced.
2.The construction site, neighboring properties and adjacent public streets shall be kept free of
construction debris at all times.
3.No construction workers, construction equipment or construction material shall encroach upon
neighboring properties.
4.The property shall have a new sanitary service line installed to the city sanitary sewer main
consisting of schedule 40 PVC or equivalent. If there is an existing 6" sewer stub at the property
line, it must be lined with 4" schedule 40 PVC or equivalent to the city’s sanitary main,and it must
include a "donut" at the end with cement.
The line must be televised after installation to ensure the following:
1.There are no obstructions in the line.
2.The PVC liner is not protruding into the city’s sanitary sewer main line.
D.General Standards
1.The value of the new home must meet or exceed the minimum value specified in the Contract for
Private Redevelopment.
2.All homes in the Richfield Rediscovered Program must be stick-built or high-quality modular, new
construction.
3.Exterior materials (siding, soffit, doors and windows) should be low-maintenance and durable.
Brick, aluminum, vinyl and fiber cement siding are preferred. Natural cedar lap is acceptable if
properly stained or painted. Hardboard panels or hardboard lap siding are prohibited. Roof
valleys should have metal valleys and not be woven.
4.Unit height and mass of the new house shall be compatible with the scale of the surrounding
homes in the neighborhood.
5.Plans must present a balanced and pleasing distribution of wall, door and window areas from all
views.
6.The dominance of the garage door must be minimized through placement, architectural detail,
door design and utilization and design of windows. Front-loaded garages (where the garage door
faces the street), shall not be located closer to the front lot line than the foremost facade of the
principal building facing the front property line. Garage sidewalls that face the street should
appear to contain habitable space. This can be accomplished by incorporating windows and other
design elements into the garage wall that are in character with the remainder of the dwelling.For
lots that have alley access, the garage should be oriented to access the alley.
7.All building plans must have been prepared in consultation with an architect or qualified
draftsperson. All requirements by the Building Inspections Division must be met.
8.All Richfield Rediscovered houses must meet or exceed Minnesota Energy Code requirements.
9.All new homes should be built to provide high quality sound insulation. Recommendations for
sound insulation measures may be provided on a site-by-site basis. All construction must
conform to current sound attenuation building standards for properties located in 65-69 and 70-74
Ldn zones.
10.If a variance is required to construct the proposed development, the HRA may, at its sole
discretion, choose to reject the application.
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11.If the HRA accepts an application that needs a variance(s), sale of the property will be contingent
upon the applicant obtaining the necessary variance(s). The Applicant is responsible for applying
for the variance(s) at its own expense.
E.Green Community Concepts
Priority will be given to projects incorporating the green community concepts listed below.Any
concepts the applicant would like considered during the application process should be explained in a
cover letter submitted with the application.
1.Protect and conserve water and soil.To reduce water consumption, consider the use of water-
conserving appliances, fixtures, and landscaping. Steps should be taken to minimize the loss of
soil and sediment during construction and occupancy to reduce storm-water sediment and air
pollution.
2.Minimize energy consumption.Reduce energy consumption by taking advantage of natural
heating, cooling and day lighting, and by using energy-efficient appliances, equipment and
lighting.
3.Enhance indoor environmental quality.Use non-toxic materials, ventilation and exhaust systems,
and moisture control products and systems.
4.Use environmentally-preferable materials and resources.Use locally-produced, salvaged and/or
manufactured materials, products with recycled content or from renewable sources, recyclable or
reusable materials, and low-VOC-emitting materials.
5.Reduce waste. Reduce and manage wastes generated during the construction process and
operation of buildings. When demolition occurs, consider the sorting and recycling of leftover
materials and debris.
VIII. City Review Procedure
1.Applicant reviews proposed project with HRA staff before plans are finalized.
2.HRA Staff will review application to ensure conformance with House Design and Site
Development Requirements.
3.HRA staff prepares a report and recommendation for the HRA.
4.A Contract for Private Redevelopment is reviewed and signed by applicants in advance of the HRA
meeting.
5.HRA reviews application and takes action at the HRA meeting.
6.If approved, the Contract for Private Redevelopment is executed by the HRA.
7.Upon approval by the HRA, the applicant is responsible for acquiring the necessary building and
demolition permits with the City of Richfield Inspections Department. If changes are required, the
Buyer must notify HRA staff.
IX. Disbursement of Funds
Approved projects are eligible for a $50,000 Redevelopment Credit. The Credit will be disbursed upon
completion of the project (including landscaping) and the issuance of a Certificate of Completion by the
Building Official.
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The Buyer may also request the Redevelopment Credit to be issued in three installments. The first
installment of $20,000 would be issued at the time of closing on the property, the second for $20,000
when permits are pulled and the third for $10,000 when the project has been completed and a Certificate
of Completion has been issued by the Building Official. A mortgage will be filed and a lien put on the
house until the project has been completed.Filing fees are the responsibility of the applicant.
The disbursement of funds will be outlined in the Contract for Private Redevelopment, to be executed by
the HRA and the Buyer.
X. Solicitation of New Development Proposals
The HRA will advertise the Richfield Redevelopment program in publications or newspapers, by direct
mail, or other methods as deemed appropriate, to solicit interest.
When the HRA has property information, it will provide the address of the property, lot dimensions and
contact information of the seller. Interested parties may contact the owners directly. All purchase
negotiations and timing issues must be resolved between the parties.
Properties identified by the applicant may also qualify. The HRA will review each one on a case-by-case
basis.
A program information package will be available upon request to interested Buyers. The information
packet will include the following:
Richfield Rediscovered Procedural Guidelines
Sample Contract for Private Redevelopment
Application Cover Sheet
Project Information Sheet
Lot List
XI. General Program Marketing
Richfield Rediscovered program marketing is entirely at the discretion of the HRA. It may include the
following:
1.Buyer Solicitation. The HRA may market the program to potential Buyers through promotional
articles, direct mail, the Internet, or other methods as deemed appropriate. Buyers may be any
financially capable individual or family, including first-time buyers, move-up buyers or empty-
nesters.
2.Public Promotion.
a.The HRA will periodically provide information about the program through articles in city
publications, on the City’s web site, on the Community Cable channel, or via press releases to
promote community awareness.
b.A public open house may be held to provide an opportunity for residents and other interested
parties to collectively view the finished homes. The Parade of Homes Fall Showcase and
Spring Preview may also accomplish this.
c..
XII.Data Privacy
All information secured through the program is subject to the Data Privacy Act.
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EXHIBIT B
FORM OF CERTIFICATE OF COMPLETION
The undersigned hereby certifies that ____________________________, has fully and
completely complied with its obligations under that document entitled “Contract for Priva te
Development”, between the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota and ________________________ dated ___________________________,
filed ___________________________ as Document No. ____________________ with respect
to the construction of the approved construction plans at ________________________, legally
described as _____________________________ and is released and forever discharged from its
obligations under such Contract.
DATED: ___________________
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
RICHFIELD
By:__________________________________
Its:Chairperson
By:__________________________________
Its:Executive Director
STATE OF MINNESOTA )
)SS
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this ____ day of
_______________, 20 , by _________________________ and ________________________
the Chairperson and the Executive Director of the Housing and Redevelopment Authority in and
for the City of Richfield, a public body corporate and politic under the laws of the State of
Minnesota on behalf of the public body corporate and politic.
________________________________
Notary Public
This instrument was drafted by:
Housing and Redevelopment Authority
in and for the City of Richfield
6700 Portland Avenue South
Richfield, MN 55423
612-861-9760