02-22-94 agendaCITY OF .RICHFIELD
HOUSING AND REDEVELOPMENT AUTHORITY
TUESDAY, FEBRUARY 22, 1994
7:00 P.M.
COUNCIL CHAMBERS
AGENDA
CALL TO ORDER
1. OPPORTUNITY FOR CITIZENS TO ADDRESS .THE HRA ON ITEMS NOT ON
THE AGENDA
2. PUBLIC HEARING AND CONSIDERATION OF RESOLUTION AUTHORIZING
SALE OF 6538 BLOOMINGTON AVENUE
HRA LETTER N0. 8
3. PUBLIC HEARING AND CONSIDERATION OF RESOLUTION AUTHORIZING
SALE OF 6501 15TH AVENUE
HRA LETTER NO. 9
ADJOURNMENT
AUXILIARY AIDS FOR INDIVIDUALS WITH DISABILITIES ARE AVAILABLE
UPON REQUEST. REQUESTS MUST BE MADE AT LEAST 96 HOURS IN
ADVANCE TO THE ADMINISTRATIVE SERVICES DIRECTOR AT 861-9702.
HOUSING AND REDEVELOPMENT AUTHORITY
HRA Letter No.9
Agenda February 22, 1994
Issue Statement:
Public hearing and consideration of.resolution authorizing sale
of-6501 15th Avenue.
Background:
The construction project at 6501 15th Avenue was authorized by
the HRA in March 1992, as a cooperative project with Hennepin
Technical College (HTC). The project is completed and a sale is
anticipated by March 1994.
The selected purchaser is a four member, income qualified family
currently renting a home in Richfield. They responded to a Sun-
Current advertisement. They meet the requirements stated in
Attachment A. HRA authorization following a public hearing would
permit final processing. The home is being sold for 589,500.
The purchasers are making a down payment of $4,500. They have
applied for an MHFA mortgage in the amount of $80,000. The
difference between the initial purchase price and the estimated
market value, $5,000, is provided by the HRA as a second
mortgage. Project costs are covered by the buyers' down payment
and first mortgage.
The second mortgage accomplishes the following:
1. Makes the initial purchase price affordable.
2. Prevents a speculative purchase in which the buyer might
benefit from selling the home quickly.
The HRA will pay up to 2-1/2 points for mortgage discounting
(approximately $2000) and the cost of title insurance
(approximately $200) at closing. After closing, the HTC contract
of $64,936 will be paid. These costs have been anticipated in
the 1993 budget and will be paid by the proceeds of sale.
If, during final processing, the family is .found ineligible by
the lender, the purchase agreement is void and the earnest money
will be released back to them. At this time however, the lender
has qualified the purchaser through the preliminary processing.
Recommended Motion:
It is recommended that following the public hearing, the HRA
adopt the attached resolution which authorizes the disposition of
the HRA owned property at 6501 15th Avenue.
Basis of Recommendation:
1. A qualified family has been identified as a purchaser and
meets program requirements.
2. A purchase agreement cannot be processed further by the
lender without HRA authorization of sale. ,
3. A public hearing notice has been published in the Sun-Current
which allows the HRA to consider the sale at the February
meeting.
4. The Planning Commission has determined that the sale for
residential purposes is consistent with the Comprehensive
Plan.
Alternative Recommendation:
Do not adopt the resolution. However, this would cause a delay
in the sale of the property, be very confusing to the buyer, and
would increase HRA holding costs.,
Discussion/Decision Mode:
Authorization of the sale is required at the February 22 meeting
so that the buyers can finalize mortgage financing for a prompt
closing.
Respectfully submitted,
Jame Prosser
Executive Director
JDP:ds
a
RESOLUTION NO.
THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD, MINNESOTA
RESOLUTION. AUTHORIZING SALE OF REAL
PROPERTY LOCATED AT
6501 15TH AVENUE
WHEREAS, the Housing and Redevelopment Authority (HRA), owns
certain real property located at 6501 15th Avenue, legally
described as: Lot 24, Block 5, Nokomis Gardens Rearrangement of
Blocks 1, 2, 3, 4, 5 Girard Parkview Addition; and
WHEREAS, the HRA acquired the property so that the South
Hennepin Technical College (HTC) could construct a new single
family home at 6501 15th Avenue, to be sold by the HRA to a
moderate income family; and
WHEREAS, the family has been identified as qualified
purchasers for 6501 15th Avenue; and
WHEREAS, the conditions of sale include a total sales price
of $89,500;. a first mortgage of $80,000 payable to the lender, a
lien of $5,000 payable to the HRA, and $4,500 down payment, and
WHEREAS, the sale of 6501 15th Avenue may be authorized by
the HRA following a public hearing which considers the
disposition of the property; and
WHEREAS, that hearing has been held following proper
publication of notice.
NOW, THEREFORE, BE IT RESOLVED by the Housing and
Redevelopment Authority in and for the City of Richfield,
Minnesota that the HRA Chairperson and Executive Director are
authorized to execute the purchase agreement and other required
documents so that the disposition of HRA-owned property at 6501
15th Avenue occurs as presented herein.
Passed by the Housing and Redevelopment Authority in and for
the City of Richfield, Minnesota this 22nd day of February 1994.
Thomas E. Harms, Chairperson
ATTEST:
Vern Luettinger, Secretary
ATTACHMENT A
6501 15TH AVENUE
NEW HOME PROGRAM
ELIGIBILITY REQUIREMENTS
FOR
HOME BUYERS
- Be a 3-6 member family (a family is defined as persons related
by blood, marriage or operation of law).
- Be a first time home buyer (or have not owned in 3 years).
- Have the following maximum annual income depending upon family
size:
Family Size Maximum Income
g 535,700
4 539,700
5 542,850
6 $46,050
This income is 80$ of the metropolitan area median income, an
accepted CDBG program income level.
- Have the ability to make monthly .payments on an 580,000
mortgage, pay $4,500 down, and pay required closing costs.
- Agree to be subject to a lien held by the HRA for the
difference between the initial sales price and the actual
value.
HOUSING AND REDEVELOPMENT AUTHORITY
HRA Letter No. 8
Agenda February 22, 1994
Issue Statement:
Public hearing and consideration of resolution authorizing sale
of 6538 Bloomington Avenue.
Background:
The construction project at 6538 Bloomington Avenue was
authorized by the HRA in August 1992, as a cooperative project
with Hennepin Technical College (HTC). The project is completed
and a sale is anticipated at the end of February 1994.
The selected purchaser is a three member family. Presently, the.
family is renting an apartment in South Minneapolis. HRA
authorization following a public hearing would permit final
processing. The home is being sold for 5105,000.
This site was purchased under the Richfield Rediscovered Program
in October 1990. No interest was expressed in the site, although
it was marketed on a continuing basis. In August 1992, the HRA
authorized the execution of a contract with HTC to build a 1-1/2
story home with several features found in other Richfield
Rediscovered homes,, such as a double garage, air conditioning,
two bathrooms and a fireplace.
Since CDBG funds were not utilized for the project, there were no
first-time buyer or income requirements. The purchasers are
making a down payment of $5,250. They have applied for an FHA
mortgage in the amount of 599,750. Project costs are covered by
the buyers' down payment and first mortgage.
The HRA will not be paying mortgage discount points, but will pay
the cost of title insurance (approximately $200) at closing.
After closing, the HTC contract of $85,949 will be paid. These
costs have been anticipated in the 1993 budget and will be paid
by the proceeds of sale.
If during final processing the purchasers are found ineligible by
the lender, the purchase agreement is void and earnest money will
be released. This is unlikely, however, since the buyers were
pre-qualified.
The HRA had an opportunity to inspect the completed work during
an open house that was held October 24, 1993.
Recommended Motion:
It is recommended that following the public hearing, the HRA
adopt the attached resolution which authorizes the disposition of
the HRA owned property at 6538 Bloomington Avenue.
Basis of Recommendation:
1. A qualified family has been identified as a purchaser.
2. A purchase agreement cannot be processed further by the
lender without HRA authorization of sale.
3. A public hearing notice has been published in the Sun-Current
which allows the HRA to consider the sale at the February
meeting.
4. The Planning Commission. has determined that the sale for
residential purposes is consistent with the Comprehensive
Plan.
Alternative Recommendation:
Do not adopt the resolution. However, this would cause a delay
in the sale of the property, be very confusing to the buyer, and
would increase HRA holding costs.
Discussion/Decision Mode:
Authorization of the sale is required at the February 22 meeting
so that the buyers can finalize mortgage financing for a prompt
closing.
Respe t ully submitted,
James Prosser
Execu ive Director
JDP:ds
RESOLUTION NO.
THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD, MINNESOTA
RESOLUTION AUTHORIZING SALE OF REAL
PROPERTY LOCATED AT
6538 BLOOMINGTON AVENUE
WHEREAS, the Housing and Redevelopment Authority (HRA), owns
certain real property located at 6538 Bloomington Avenue, legally
described as Lot 8, Block 5, Nokomis Gardens Rearrangement of
Blocks 1,2,3,4,5 Girard Parkview Addition; and
WHEREAS, the HRA acquired the property so that the South
Hennepin Technical College (HTC) could construct anew single
family home at 6538 Bloomington Avenue, to be sold by the HRA to
a lender-qualified purchaser; and
WHEREAS, a family has been identified as qualified
purchasers for 6538 Bloomington Avenue; and
WHEREAS, the conditions of sale include a total sales price
of $105,000; a first mortgage of $99,750 payable to the lender
and $5, 2.50 .down payment; and
WHEREAS, the sale of 6538 Bloomington Avenue may be
authorized by the HRA following a public hearing which considers
the disposition of the property; and
WHEREAS, that hearing has been. held following proper
publication of notice.
NOW, THEREFORE, BE IT RESOLVED by the Housing and
Redevelopment Authority in and for the City of Richfield,
Minnesota that the HRA Chairperson and Executive Director are
authorized to execute the purchase agreement and other required
documents so that the disposition of HRA owned property at 6538
Bloomington Avenue occurs as presented herein.
Passed by the Housing and Redevelopment Authority in and for
the City of Richfield, Minnesota this 22nd day of February, 1994.
Thomas E. Harms, Chairperson
ATTEST:
Vern Luettinger, Secretary