09-20-93 agendaCITY OF RICHFIELD
HOUSING AND REDEVELOPMENT AUTHORITY
MONDAY, SEPTEMBER 20, 1993
7:00 P.M.
COUNCIL CHAMBERS
AGENDA
CALL TO ORDER
APPROVAL OF MINUTES OF (1) HRA MEETING OF AUGUST 16, 1993 AND (2)
SPECIAL HRA MEETING OF AUGUST 30, 1993
1. OPPORTUNITY FOR CITIZENS TO ADDRESS THE HRA ON ITEMS NOT ON
THE AGENDA
2. PUBLIC HEARING AND CONSIDERATION OF RESOLUTION AUTHORIZING
SALE OF RICHFIELD REDISCOVERED PROPERTY AT 6912 OLIVER
AVENUE TO MARLIN GRANT HOMES, INC. IN ACCORDANCE WITH
DEVELOPMENT AGREEMENT
HRA LETTER N0. 37
3. PUBLIC HEARING AND CONSIDERATION OF RESOLUTION AUTHORIZING
SALE OF RICHFIELD REDISCOVERED PROPERTY AT 7124 WASHBURN
AVENUE TO MARLIN GRANT HOMES, INC. IN ACCORDANCE WITH
DEVELOPMENT AGREEMENT
HRA LETTER N0. 38
4. CONSIDERATION OF RESOLUTION AUTHORIZING EXECUTION OF SOUTH
HENNEPIN VOCATIONAL TECHNICAL SCHOOL CONTRACT IN AMOUNT OF
$73,377. FOR 1993-94 NEW CONSTRUCTION PROJECT AT 7112 FIRST
AVENUE
HRA LETTER N0. 39
5. CONSIDERATION OF AUTHORIZATION TO PROCEED WITH RICHFIELD
REDISCOVERED REMODELING PROGRAM
HRA LETTER NO. 40
6. EXECUTIVE DIRECTOR REPORT
7. CLAIMS AND PAYROLL
ADJOURNMENT
AUXILIARY AIDS FOR INDIVIDUALS WITH DISABILITIES ARE AVAILABLE
UPON REQUEST. REQUESTS MUST BE MADE AT LEAST 96 HOURS IN
ADVANCE TO THE ADMINISTRATIVE SERVICES DIRECTOR AT 861-9702.
HOUSING AND REDEVELOPMENT AUTHORITY
HRA Letter No. 40
Agenda September 20, 1993
Issue Statement:
Authorization to proceed with the Richfield Rediscovered
Remodeling Program.
Background:
The Richfield Rediscovered program has developed into many
program elements: removal of substandard housing, construction of
new higher value homes, modest cost new construction initiatives,
and transformation housing. Staff has prepared another element
for the HRA to consider. It is called the Richfield Rediscovered
Remodeling Program.
A package of services is proposed to aggressively assist
homeowners and future homeowners to make value added improvements
to the existing housing stock. The attached Star Tribune .article
discusses value added improvements in more detail.
The HRA, in cooperation with Norwest Mortgage,. would make a
unique refinance/remodel and purchase/remodel type of mortgage
available from the federal secondary mortgage market lender,
Fannie Mae. Norwest would initially provide up to $5,000,000
(approximately 50 to 60 loans). The set aside would refinance an
existing mortgage and any value added improvements the owner
wants. Purchase and remodeling is also .allowed. A comparison of
mortgages available in Richfield is attached. This mortgage is
available at terms similar to other mortgages but with the
distinction of receiving funds at a higher loan to value ratio
based on the future value of the improved property. There are no
income limits or types of improvement restrictions anticipated,
subject to final approval by Fannie Mae. The collaborative is
further defined by a letter of understanding between Norwest and
the HRA which describes the package of services to be provided.
A summary of .those services follows and is described more fully
in an attachment to this letter.
During the first year, it is proposed that 595,000 from the
Development Fund be committed to the following package of
services:
HRA Program Element
Neighborhood Improvement Advisor
Marketing, design options/services
Marketing, general program
Norwest Mortgage, contingency loans
Remodeling Hot Line
Remodeler Qualifying
Estimated Cost
$35,000
$20,000
$16,000
$15,000
S 9,000
in-kind (by HRA staff)
Total Cost $95,000
Norwest requires the Advisor, contingency loan, general
marketing, hotline and remodeler qualifying services from the HRA
-which total 575,000. The proposal also includes $20,000 to
develop and provide easy to understand display and print material
on housing design and expansion options. Each loan applicant
will pay a $200 program fee at closing to reimburse the HRA for a
portion of the contribution. On 50 mortgages, the HRA recovers
$10,000.
The Richfield Rediscovered Remodeling Program is much broader
than a single mortgage offering with a single lender. Under the
Richfield Rediscovered umbrella, it provides a way for staff to
coordinate and facilitate all the financing,. technical advice,
design services, special events, and home improvement options
that are or can be made available to assist residents in making
remodeling decisions. It is envisioned that this remodeling
initiative, as further developed, would become a "one stop
shopping" opportunity for residents.. Like the Richfield
Rediscovered new construction program, the HRA plays a key role
in facilitating remodeling decisions while allowing private
remodeling business to take place.
Recommended Motion:
Authorize staff to proceed with the Richfield Rediscovered
Remodeling Program as outlined herein.
Basis of Recommendation:
1. Staff routinely receives calls from residents which indicate
they are financially secure, would prefer to remain in
Richfield, and are at a decision point as to whether to
remodel or relocate.
2. A package of financing and technical support remodeling
services is proposed to facilitate $10,000, $20,000, $30,000,
and $40,000 in value added improvements to be made to
Richfield's average $80,000 to $90,000 homes.
3. The proposed mortgage program has been utilized successfully
the last two years in St. Paul and Minneapolis. Richfield
would be the first suburban community, to our knowledge, to
implement a program. The. cooperation of local government and
lenders is needed because the program is administratively
more complex than typical mortgage programs, takes a Fannie
Mae approved rehabilitation lender, and requires the lender
to be a construction payment manager with on site inspectors
and escrow servicers.
4. Norwest Mortgage, in partnership with Norwest Bank-Richfield,
is approved by Fannie Mae to deliver this program. Richfield
Bank and Trust, First Bank, and Firstar were all contacted
during the program development process. Only Norwest
Mortgage is qualified, ready, and interested at this time.
If other lenders become qualified and express an interest in
participating, they could be added to the program. at a later
date.
5. The proposed remodeling program is consistent with $93,300 in
Development Fund initiatives identified by the HRA in May
1993. The cost has been refined to 595,000 with a projected
return of $10,000 from program fees. Approximately $75,0'00
of this package of services are. considered essential
contributions by the HRA for Norwest Mortgage to offer a
special mortgage.
6. Norwest Mortgage is ready to start in October 1993., This
readiness coincides well with special open house events
planned in October and November and the upcoming Remodeling
Fair anticipated in early 1994.
7. The mortgage program offered by Norwest Mortgage, as part of
a broader Richfield Rediscovered Remodeling program package
of services, provides an attractive and competitive
alternative for homeowners and homebuyers that should
facilitate value added remodeling.
Alternative Recommendation:
Do not pursue a remodeling program initiative at this time.
Discussion/Decision Mode:
Individual contracts for .services, such as might occur by
initiating a marketing program and identifying a neighborhood
improvement advisor would be brought to the HRA in October . It
is anticipated that Norwest .wants to make the program available
in October. The mortgage program would be offered with several
special events being planned in October, November, and early
1.994.
Respectfyfl)L.y submitted,
Prosser
Director
JDP:ds
Richfield Rediscovered Remodeling Program
HRA Program Element Summary
Estimated
Program Element Cost
Neighborhood Improvement Advisor: $35,000
Value added remodeling can be very challenging.
The Advisor assists homeowners in how to select a
remodeler, plan a project, evaluate the design and
function of a project, and finance the project.
Routinely, program and technical information and
referral would be provided by the Advisor as the
remodeling program point person.
Marketing: (design options/servi.ces) $20,000
Good design in remodeling and assisting homeowners
in identifying properly designed expansion options
is important. Educational models, displays, and
print materials are developed to assist the
homeowner during the project planning phase.
Marketing: (general) $16,000
The successful coordination of program information
and special events leads to program participation.
Assistance comes from a marketing plan prepared
with a marketing consultant and the publication
and distribution of that information in the
community.
Contingency Reserve Loans: $15,000
Norwest Mortgage seeks contingency financing from
the HRA if a remodeling job in progress uncovers
hidden problems that loan proceeds and homeowner
resources are insufficient to cover. On a case by
case basis, the HRA would offer a deferred loan of
up to ten percent of the remodeling work provided
the homeowner matched $1 for $1 of HRA
contribution. A second mortgage would secure the
loan to be repaid at time of future sale.
Remodeling Hot Line: $ 9,000
On a 24 hour basis, a telephone service would be
developed to inform callers of all the financing,
technical advice, special events, and home
improvement options that are available in
Richfield.
Remodeler Qualifying:
The homeowner will determine a scope of work,
identify a contractor, and request a loan from
Norwest. Staff has established criteria and would
verify whether the general contractor meets a
minimum set of standards:
- Ability to provide a 100 percent of contract
performance bond/letter of credit to Norwest.
- Builder's risk, Comprehensive General liability,
and Workers' Compensation. insurance coverage.
- Written warranty policy, provided to homeowner
.and lender.
- The remodeler should anticipate being asked to
provide the following references to the
homeowner:
a) five satisfied customers;
b) three major suppliers or subcontractors; and
c) building officials from two cities where the
remodeler has worked in the past three
years.
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The cost and benefits of remodeling
Two of the most important bits of information you need to begin planning a remodeling project
are: How much might it cost'? And is N worth it; will I get my money back? A national survey of
remodeling contractors and real estate agents by Remodeling magazine attempts to give
consumers and their contractors average ballpark ligures for 11 of the most yearned~lor projects.
The Twin Cities area was one o1 t30 markets surveyed. local contractors said the survey ligures
sre on the lower end of average, representing quality work but only moderately•priced products
and materials.
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information / 12E ,-~
(Star Tribune
Payouts,
paybacks
1/hen we think about
remodeling, we first wonder,
"How much will it cost?" Then,
after the shock wears off, we
ask, "Is it worth it? ,Would we
ever get that money back?"
By Ingrid Sandstrom `~, remodeling con
Staff Wrller " tractors In the 60
' cubs surveyed
t ou haven
t
Y.
' paned remodel-
l
I
l
t
t translate remodel-
Ing costs to their
y,
e
ng cos
s
a customers, many of
get reedy for
sticker shock.
TOSS Of f a whom ere largely
Ignorant about the
O. What does ri coat throw pillow ., - tars and cents
Involved. taut It also
to update a 200- ZE helps clients end
squaredoot krichen, their ContraCtorS
with medium-quality calculate the value
cabinets, floor Cover-
l it's time of their investment.
iances,
mgr and app
rwt as a do-it-your• t0 SOW "In general, con-
sell project, but pro•
ZE sumers really are
fessionally designed Helve shout remod-
and executed? eiing costs," sold
A. At least 520,105 in
FIXIO
g Tom Irmlter, presl-
dent Ot Irmlter (An-
the Minneepolls$f.
Thera the
Paul area floor damage struction in St. Paul
.
finding of Remodel- ~ ZE and a former presl-
dent of the local
me azlne, a
g
O chapter o1 the Na•
agazine for
e m
• tlonal Association
amodelin
9 of the Remodeling
,:ontrectors. Industry (NARI).
"They see beeutilul
O. Is it worth it9 pictures of kitchens
A. It the project is well done, with and bathrooms on TV and in mag-
t
N"'.
The cost and benefits of remodeling
Two of the most important bits of information you need to begin planning a remodeling project
ere: How much might it cost? And is k worth it: will I get my money back? A national survey of
remodeling contractors and real estate agents by Remodeling magazine attempts to give
consumers and their contractors average ballpark figures for 1 t of the most yearned for projects.
The Twin Cities area was one of 00 markets surveyed. local contractors said the survey figures
are on the lower end of average, representing quality work but only moderately priced products
end materials.
;;}~,Y
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'Stolen Children' is sentimen
Study propelled Griffith's car
Local poetry sings in 'Paymel
Adrle~/ 1 tE Comics
TY,R~dlo/10E Croeswc
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~:.
1. Mayor kRchen remodeling (200 square teat updated !20,105 !19,875 99
with new cabinets, lights, floors end appliances but
keeping the old refrigerator).
2. Minor kitchen remoMling (reBMah cabinets, new !8,477 !8,500 131%
oven, twolctop, t:olmMrs, floors end paint). r
~. Bath addRlon (8x8 in existing space). !11,228
' S1t,250 100°/.
~ !1,593 '•
` ~: 8a modern! (update 5x9 wHh new Hxtures, tile) !!,125 107%,
5. Sunspace addition (12 x 16 glass encbsure) 526,523 525.625 979b
6. Family room addition (16x25 on crawl space Iounda- !30,436 !28,250 93°h
lkm, hardwood Moor, tbd into exlSUfsg hasring and cooling)
7. lJeek addition (t6 x 20 pressure-treated pine with 55,931 58,250 10596
bench end Planter)
e. Master iltNte (combine two existing bedrooms end DaM) !23,402 122,750 9rh
9. Replete windows (with t6 3x5 vinyl or vinyl-clad 57,632 57,167 849:
aluminum double-paned windows)
10. Replace siding (2,000 Sgare feet of vinyl or aluminum !9,675 !8,500 87%
siding, new soffits, fascia and trim and guriers)
11. Attie bedroom (convert unfinished space to 75 x 15 523,308 S22,750 . 9896
bedroom and 5 x 7 bathroom with shower)
good design, it should be worth azrnes and they have nO klea of
how much it costs
" - .,
~wwr,rw..., -
your investment, Remodeling re-
ported as part of its 11th annual .
he
ch of the blame for that
M
R-^~° _ ~~,
,.
~ `
- _
Cost vs. VeluA report. Although
few people undertake a major re- ,
u
said, Iles with remodeling contrec-
who have not Dean as forth•
fora .. Star Tribune Graphic/ Ray Grumnr
modeling project lust before selling
a home, if you did sell within a year
the ,
coming with cost figures es they
Should Choosing a contractor and settling on a pricE
of completing that project, .
magazine's survey indicated that
you d recoup about 99 percent of
"It's no secret that remodeling
l
T' ''t 8y Ingrid irbnds, fte hDOrs, coworkers and
~
retetives -and t[om your erchl- about troth.
your expenditure - or 519,875 -
in added value to your home in this se, ere
contractors, like anyone e
in business not only to serve their
" Sandstrom
Staff Writer tact or designer _ is a trbd•snd-
true way of Uning up contractors to You'll want to know if the contrac
for was timely, creative and con-
metro area. Ir-
clients, but to make money,
miter said. "But for some reason The contractor Is Interview. il, however, you decide talned costs and if he or she was
The magazine surveyed local real
te those
i ,
remodeling costs aren'tgenerally
discussed in ways to help people one o1 the~most Im-
portent elements of to Intervkw contractoro Chosen et
a home atrow,lrom the Yellow easy to get ebng with. (Remem-
her, ri becomes a close end inti-
ma
estste agents to est
returns. It assumed the projects understand the financial picture.
it's not a high-profit type of burl- your remodeling
pro)ect, so choosing Pages, or en advsrllaement, melee
sure you check references. mate relationship.) Visit complete
projects end projects in progress
would take place in mid-priced
homes in established neighbor-
hoods where much remodeling Is Hess, and we should help people
understand whet ri's all at»ut." the right one to
work with should take time, know!-
People who hsv9 been pleased - _ it possible.
taking place. edge end care. with their corttractora will be glad
to discuss his or her plusses and When beginning to discuss bids,
The report is done primarily to help • REMODELING
continued on paps 3E Getting recommendations from minuses; be curs that you ask COST continued on pegs 3E
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HOUSING AND REDEVELOPMENT AUTHORITY
HRA Letter No.39
Agenda September 20, 1993
Issue Statement:
Authorization to execute a contract with South Hennepin Vocational
Technical School (Vo-Tech) to initiate a 1993-94 New Home project at
7112 First Avenue.
Background°
Vo-Tech has requested that the HRA participate in a new construction
project for the school year 1993-94. The two organizations have
participated together in more than 20 projects since 1977. The projects
provide rehabilitation and new construction training opportunities for
the Vo-Tech students and affordable new housing for the community. A
project at 7112 First Avenue is proposed. The home will be stick-built
on the site.
On June 21, 1993, the HRA authorized staff to acquire the property at
7112 First Avenue through the Voluntary Acquisition Program. HUD rules
require that the City purchase the property and subsequently transfer
the property to the HRA. The City will acquire the property later in
September from Grace Church of Richfield.
Transfer of the property to the HRA can occur at any time since the
City-authorized transitory ordinance became effective August 23, 1993.
Staff, in cooperation with Vo-Tech architectural drafting faculty, has
developed project plans to meet all setback requirements, to complement
the design of neighboring homes and to incorporate interior features
desirable in today's market. The hearing examiner has previously
approved a lot size variance given the lot size is approximately 113
square feet smaller than a 6000 square foot standard lot.
The new house will have approximately 1,160 square feet of finished
living area. It will feature a split level design with a living room,
dining room, kitchen, three finished bedrooms, a bathroom, and a deck.
Space is provided for a future fourth bedroom, another bath, and a
future detached garage adjacent to the alley. The existing garage is
located where part of the new house will set and will also be
demolished.
The amount of ,the Vo-Tech contract for this project is not to exceed
$73,377. This cost is consistent with previous projects given design
and square footage variables. Preliminary investigation with other
contractors indicates the house would cost $85,,000 to $90,000 without
the cost savings provided by Vo-Tech.
The estimated project costs and funding sources follow:
ACTIVITY
Acquisition: $ 36,000
Demolition: $ 3,255
Vo-Tech Contract: S 73,377
Landscaping: $ 4,000
Legal (Sale): $ 600
Closing Costs: $ 2,500
Total Cost $119,732
FUNDING SOURCES
CDBG
CDBG
Proceeds of Sale
Proceeds of Sale
Proceeds of Sale
Proceeds of Sale
Private contractors will complete the electrical, plumbing, heating,
and painting portions of the work. Legal counsel has previously
reviewed and is satisfied with the contract requirements. A copy of
the building elevations also accompanies this letter. The home will
be sold to a first time home buying family of three to six members,
having a moderate income of between $27,000 and $46,000. Although
the completed value of the home has not yet been determined by
independent appraisal, staff estimates that the value should
approximate $87,500.
A reduced interest rate mortgage would be secured from the Minnesota
Housing Finance Agency in the summer of 1994, if available. FHA
financing is an acceptable alternative pending mortgage interest
rates at the time.
Recommended Motion:
It is recommended that the HRA adopt the attached resolution which
authorizes the execution of the Vo-Tech contract in the amount of
$73,377 for the 1993-94 new construction project at 7112 First
Avenue.
Basis of Recommendation:
1. The City will purchase the property this month and the HRA can
acquire the property soon thereafter. The purchase and clearance
of the existing garage home resolves the blighting influence of a
substandard rental property.
2. Plans have been .developed and the Vo-Tech is ready to start
October 1, 1993. The house will meet site requirements and
program needs of the HRA.
3. The Inspection Division has reviewed the plans for the project.
4. Site development is consistent with the Comprehensive Plan.
5. Adjoining neighbors have reviewed the project with staff.
Alternative Recommendation:
Do not authorize execution of the Vo-Tech contract.
Discussion/Decision Mode:
The 7112 First Avenue project will
execution would occur immediately
property from the City to the HRA
project.
be stick-built on site. Contract
following the transfer of the
to secure the HRA's interest in the
Jame Prosser
Execu a Director
Resp f lly submitted,
JDP:ds
RESOLUTION NO.
THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND
FOR THE CITY OF RICHFIELD, MINNESOTA
RESOLUTION RELATING TO VO-TECH AGREEMENT FOR
7112 FIRST AVENUE
WHEREAS, on June 21, 1993, the HRA authorized the purchase of
7112 First Avenue, legally described ass
Lot 4, Block 2, Sheldon Blair's Wooddale Fourth Addn.; and
WHEREAS, HUD CDBG funds have been authorized for this
acquisition; and
WHEREAS, HUD rules require that the City, rather than the HRA,
initially purchase the property with a subsequent sale to the HRA;
and
WHEREAS, the City will purchase the property in September 1993;
and
WHEREAS, a. project has been proposed as a cooperative effort
between the HRA and South Hennepin Vocational Technical College (Vo-
Tech); and
WHEREAS, the property at 7112 First Avenue would be developed
with a new single family home; and
WHEREAS, the Construction Agreement price for the new
construction project will not exceed 573,377; and
WHEREAS, following completion of the new construction work, the
property will be sold to a first-time home buying, moderate income
family.
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:
Enter into a Construction Agreement with Vo-Tech for an amount
not to exceed $73,377, for the new construction project at 7112 First
Avenue.
Adopted by the Housing and Redevelopment Authority in and for
the City of Richfield, Minnesota this 20th day of September, 1993.
Thomas E. Harms, Chairperson
ATTESTe
Lawrence Wozniczka, Secretary,.
SUMMARY OF
CONTRACT REQUIREMENTS FOR VO-TECH PROJECT AT
7112 FIRST AVENUE
• The construction of a split entry home at 7112 First Avenue.
• The professional installation of heating, electrical and plumbing
systems.
• Completion by October 1994.
• Supervision of labor and insurance coverage to be the
responsibility of Vo-Tech.
• Vo-Tech is responsible for a one-year warranty for defects caused
by faulty workmanship or defective materials, a two-year warranty
on installation of plumbing, electrical, heating and cooling
systems and a ten-year warranty on structural defects.
• A provision specifying the Vo-Tech's responsibilities concerning
timely completion of the exterior facade, and routine site
maintenance during the construction period.
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HOUSING AND REDEVELOPMENT AUTHORITY
HRA Letter No. 38
Agenda September 20, 1993
Issue Statement:
Public hearing and authorization of the sale of a Richfield
Rediscovered property at 7124 Washburn Avenue to Marlin Grant
Homes, Inc.
Background:
The HRA purchased the substandard property at 7124 Washburn
Avenue in March 1993.
Marlin Grant Homes, Inc. of Bloomington, MN has. secured a
purchase agreement from a buyer for the lot at 7124 Washburn
Avenue. The sale price of the lot will be $27,500. The new
house will be valued at approximately $110,000. (.Preliminary
plan sheets are attached.)
The development agreement used in Richfield Rediscovered projects
requires Marlin Grant Homes, Inc. to:
• Pay the stated lot value upon completion of .the home.
• Provide financial/performance security during the
construction period with a Letter of Credit, or similar
security, that has a value of $27,500.
• Complete the home and pay for the lot by February 28, 1994.
• Meet house design, landscaping, and insurance requirements
which are specified.
In December 1992, a public hearing was held by the HRA to sell
this site for development to Kesler Construction. However,
Kesler and the prospective purchaser could not come to terms on
final project costs. Kesler does not now intend to develop the
property and Marlin Grant Homes, Inc. has identified a purchaser
for 7124 Washburn Avenue.
Marlin Grant Homes, Inc. completed Richfield Rediscovered homes
at 7500 Bryant Avenue and 6641 Oliver Avenue this year. The
projects were promptly developed and all of the HRA's financial
requirements were met.- Similar success is anticipated at 7124
Washburn Avenue.
Recommended Motion:
Conduct the public hearing and subsequently adopt the attached
resolution which authorizes the Chairperson and Executive
Director to execute agreements to sell 7124 Washburn Avenue to
Marlin Grant Homes, Inc. for development of a new single family
home.
l Basis of Recommendation:
1. A check of references indicates Marlin Grant Homes, Inc. is
an experienced, capable, financially secure builder.
2. The HRA has the lot at 7124 Washburn Avenue available to
sell. A contractor previously authorized to develop the
site, Kesler Construction, did not proceed.
3. A development agreement has been. negotiated with Marlin Grant
Homes, Inc. and is in conformance with program guidelines.
4. Notice of public hearing was published in the Sun-Current on
September 8, 1993.
5. Previously, the Planning Commission found the sale of the lot
for development of a new home to be in conformance with the
City°s comprehensive plan.'
Alternative Recommendation:
Do not proceed with a development agreement with Marlin Grant
Homes, Inc. and direct staff to find another buyer.
Discussion/Decision Mode:
Marlin Grant Homes, Inc. hopes to close in early October 1993,
and start construction immediately thereafter.
Respect ly submitted,
James Prosser
Execu a Director
JDP:ds
RESOLUTION N0.
THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE
CITY OF RICHFIELD
RESOLUTION AUTHORIZING THE SALE OF REAL
PROPERTY LOCATED AT 7124 WASHBURN AVENUE
TO MARLIN GRANT HOMES, INC., IN ACCORDANCE WITH
A DEVELOPMENT AGREEMENT
WHEREAS, the Housing and Redevelopment Authority in and for
the City of Richfield, Minnesota (HRA} desires to develop certain
real property pursuant to and in furtherance of the Richfield
Rediscovered Program Redevelopment Project (Project) heretofore
adopted by the City of Richfield (City) and the HRA, said real
property being described as follows:
°'North 50 ft of Lot 63, except the East 57.52 ft thereof and
the North 50 ft of the East 73 ft of Lot 62 Sabin Lake Harriet
Garden Lots'°, and located at 7124 Washburn Avenue; and
WHEREAS, the HRA is authorized to sell real property within
its area of operation after public hearing; and
WHEREAS, the HRA held a public hearing and authorized the
sale to Kesler Construction Company in December 1992. However,
the development project could not be finalized; and
WHEREAS, a developer, Marlin Grant Homes, Inc. of
Bloomington has been identified as the purchaser of the described
property, in accordance with a development agreement; and
WHEREAS, the public hearing has been held after proper
public notice; and
WHEREAS, the Planning Commission has made a finding that the
disposition of the property for residential purposes is
consistent with the comprehensive plan.
NOW, THEREFORE, BE IT RESOLVED by the Richfield Housing and
Redevelopment Authority:
1. A public hearing has been held and 7124 Washburn Avenue is
authorized to be sold to Marlin Grant Homes, Inc. for $27,500
in accordance with a development agreement with the HRA. The
HRA withdraws any authorizations previously given to Kesler
Construction to develop the property.
2. That the Chairperson and Executive Director are authorized to
execute the Development Agreement and other agreements as
required to effectuate the sale to Marlin Grant Homes, Inc.
Adopted by the Housing and Redevelopment Authority in and for
the City of Richfield, Minnesota this 20th day of September,
1993°
Thomas E. Harms, Chairperson
ATTEST:
Lawrence Wozniczka, Secretary
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HOUSING AND REDEVELOPMENT AUTHORITY
HRA Letter No.3~
Agenda September 20, 1993
Issue Statement:
Public hearing and authorization of the sale of a Richfield
Rediscovered property at 6912 Oliver Avenue to Marlin Grant
Homes, Inc.
Background:
The HRA purchased the substandard property at 6912 Oliver Avenue
in June 1993.
Marlin Grant Homes, Inc. of Bloomington, MN has secured a
purchase agreement from a buyer for the lot at 6912 Oliver
Avenue. The sale price of the lot will be $31,000 . The new
house will be valued at approximately 5147,000. (Preliminary
plan sheets are attached.)
The development agreement used in Richfield Rediscovered projects
requires Marlin Grant Homes, Inc. to:
• Pay the stated lot value upon completion of the home.
• Provide financial/performance security during the construction
period with a Letter of Credit, or similar security, that has
a value of 531,000. (This amount is the difference between
the lot price and the total HRA investment in the property,
whichever is greater.)
• Complete the home and pay for the lot by February 28, 1994
(150 day construction period).
• Meet house design, landscaping and insurance requirements
which are specified.
New homeowners are now living in the homes completed by Marlin
Grant Homes, Inc. at 6415-15th Avenue, 6407-15th Avenue, 6641
Oliver Avenue and 7500 Bryant Avenue. The projects were promptly
developed and all of the HRA's financial requirements were met.
Similar success is anticipated at 6912 Oliver Avenue.
Recommended Motion:
Conduct the public hearing and adopt the attached resolution
which authorizes the Chairperson and Executive Director to
execute agreements to sell 6912 Oliver Avenue to Marlin Grant
Homes, Inc. for development of a new single family home.
Basis of Recommendation:
1. A check of references and performance with HRA contracts
indicates Marlin Grant Homes, Inc. is an experienced,
capable, .financially secure builder.
2. The HRA has the lot at 6912 Oliver Avenue available to sell.
3. A development agreement has been negotiated and is in
conformance with program guidelines.
4. Notice of public hearing was published in the Sun-Current on
September 8, 1993.
5. Previously, the Planning Commission found the sale of the lot
for development of a new home to be in conformance with the
City's comprehensive plan.
Alternative Recommendation:
Do not proceed with a development agreement with Marlin Grant
Homes, Inc. and direct staff to find another buyer.
Discussion/Decision Mode:
Marlin Grant Homes, Inc. hopes to close by the end of September
1993 and start construction immediately thereafter.
Respe t lly submitted,
James Prosser
Execu a Director
JDP:ds
RESOLUTION N0.
THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE
CITY OF RICHFIELD
RESOLUTION AUTHORIZING THE SALE OF REAL
PROPERTY LOCATED AT 6912 OLIVER AVENUE
TO MARLIN GRANT HOMES, INC., IN ACCORDANCE WITH
A DEVELOPMENT AGREEMENT
WHEREAS, The Housing and Redevelopment Authority in and for the
City of Richfield, Minnesota (HRA) desires to develop certain real
property pursuant to and in furtherance of the Richfield Rediscovered
Program Redevelopment Project (Project) heretofore adopted by the
City of Richfield (City) and the HRA, said real property being
described as follows:
Lot 4, Block 10 Tingdale Bros.' Lincoln Hills Addition and
located at 6912 Oliver Avenue; and
WHEREAS, the HRA is authorized to sell real property within its
area of operation after public hearing; and
WHEREAS, a developer, Marlin Grant Homes, Inc. of Bloomington
has been identified as the purchaser of the described property, in
accordance with a development agreement; and
WHEREAS, the public hearing has been held after proper public
notice; and
WHEREAS the Planning Commission has made a finding that the
disposition of the property for residential purposes is consistent
with the comprehensive plan.
NOW, THEREFORE, BE IT RESOLVED by the Richfield Housing and
Redevelopment Authority:
1. A public hearing has been held and 6912 Oliver Avenue is
authorized to be sold to Marlin Grant Homes, Inc. for $31,Q00 in
accordance with a development agreement with the HRA.
2. That the Chairperson and Executive Director are authorized to
execute the Development Agreement and other agreements as
required to effectuate the sale to Marlin Grant Homes, Inc.
Adopted by the Housing and Redevelopment Authority in and for
the City of Richfield, Minnesota this 20th day of September, 1993.
Thomas E. Harms, Chairperson
ATTEST:
Larry Wozniczka, Secretary
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SECOND LEVEL