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06-17-91 agenda,.,-~.~ 8.-e~ HOUSING AND REDEVELOPMENT AUTHORITY JUNE 17, 1991 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. CONSIDERATION OF MODIFICATION OF DEVELOPMENT AGREEMENTS WITH MARV ANDERSON HOMES, INC. (MARV ANDERSON) HRA LETTER NO. 14 3. CONSIDERATION OF EXPANDED NEW HOME PROGRAM (ENHP) PROGRESS REPORT HRA LETTER NO. 15 4. CONSIDERATION OF RESOLUTION AUTHORIZING PURCHASE AGREEMENT AND ACQUISITION OF 6803 NICOLLET AVENUE ~-~ ~'~, y ~ g HRA LELETTER NO. 16 5. CONSIDERATION OF RESOLUTION7AUTHORIZING EXECUTION OF CONTRACTS WITH SOUTH HENNEPIN VOCATIONAL TECHNICAL SCHOOL (VO-TECH) TO INITIATE TWO 1991-92 PROJECTS des ~ ~ ~ ~ ~ zr~ HRA LETTER N0. 17 6. CONSIDERATION OF RESOLUTION AUTHORIZING SUBMISSION OF AN ALTERNATIVE CONSERVATION IMPROVEMENT PLAN TO MINNESOTA DEPARTMENT OF PUBLIC SERVICES ~~ ~ /,.~ ~ HRA LETTER NO. 18 7. CONSIDERATION OF RESOLUTION AUTHORIZING AGREEMENT WITH NKS CONSULTING, INC. TO PROVIDE BUSINESS ENERGY CHECKUP AUDIT SERVICES ~~S ~..' a-~ HRA LETTER NO. 19 8. EXECUTIVE DIRECTOR REPORT 9. CLAIMS AND PAYROLL ADJOURNMENT HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 19 Agenda June 17, 1991 Issue Statement• Authorization to enter into an agreement with NKS Consulting, Inc. for the delivery of Business Energy Checkup audit services. Background: The HRA received a grant from the Minnesota Department of Public Service to develop and initiate a business property energy audit program. The audits, at a cost of $125 each, will be funded by Northern States Power Company. The purpose of the audit is to: s Identify the three or four highest priority conservation opportunities which would improve energy efficiency up to 30$ or more. o Provide site-specific information and instruction for the owner/manager in simple, clear terms so there is an understanding of the conservation opportunities, anticipated results, and appropriate follow up action. o Provide consultation in formulating a plan of action. • Provide a follow up with the owner/manager to answer further questions and assist as necessary with implementing the plan of action. During the past four years, NKS has performed approximately 15,000 residential, 500 commercial, and 300 multifamily audits in a variety of communities. The principal in the firm, Norman Harold, has developed the technical training manual and been the lead instructor for the State of Minnesota's commercial energy audit training courses. NKS Consulting, Inc. is a private consulting firm specializing in the areas of energy conservation and load management. NKS proposes to: 1) deliver professional energy analysis services to owners and managers of small businesses, churches, and non-profit and similar organizations located in the City; 2) provide technical assistance in program marketing to HRD staff; and 3) provide approximately 50 audits during the period of July, 1991 through September, 1992. The business of commercial auditing is a specialized field with few participants. Three known firms in the Twin City metropolitan area were solicited by staff to respond to a Request For Proposal. One did not respond, the other firm's response was late and too expensive. The NKS firm responded with a proposal that would provide the audit service at a cost completely covered by NSP. The agreement with NKS is similar to one already used by the HRA with the Self Reliance Center for residential audits. The agreement identifies a scope of service, minimum training and certification of auditors, and liability and insurance protections for the HRA. Recommended Motion: Authorize the Executive Director and Chair to enter into an agreement with NKS Consulting, Inc. to provide Business Energy Checkup services to Richfield businesses. Basis for Recommendation: 1. The HRA has received a grant to develop and implement a commercial audit program. The audits, at a cost of $125 each, will be funded by Northern States Power Company. 2. The HRA previously authorized an audit service agreement with Northern States Power Company which would provide reimbursement for commercial audits if the HRA authorized a commercial audit program. 3. Business Energy Checkup services are beneficial to the City as they reduce costs related to energy consumption and make commercial and other non residential buildings more energy efficient. Alternative Recommendation: Do not authorize an agreement for delivery of Business Energy Checkup services at this time. Discussion/Decision Mode: An agreement would be executed start up could occur in July. if the HRA concurs and program y submitted, Prosser Director JDP:ds Attachment RESOLUTION N0. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD A RESOLUTION AUTHORIZING AN AGREEMENT WITH NKS CONSULTING, INC. WHEREAS, the Richfield HRA has received a grant from the Minnesota Department of Public Service for the development and implementation of a Business Energy Checkup service; and WHEREAS, Northern States Power Company will fund the service delivery of Business Energy Checkups; and WHEREAS, a qualified firm, NKS Consulting, Inc., has been identified. NOW, THEREFORE, BE IT RESOLVED, by the Housing and Redevelopment Authority of Richfield, Minnesota as follows: The Executive Director and Chair are authorized to enter into an agreement with NKS Consulting, Inc. to provide Business Energy Checkup services until September 30, 1992. Passed by the Housing and Redevelopment Authority of Richfield, Minnesota this 17th day of June, 1991. Thomas E. Harms, Chairperson ATTEST: Joan Helmberger, Secretary DRAFT BUSINESS ENERGY CHECKUP SERVICES AGREEMENT This Business Eenrgy Checkup Services Agreement dated June 17, 1991 is between the NKS Consulting, Inc. (NKS), a MN corporation, located at 5591 East 180th Streety Prior Lake, MN 55372 and the. Housing and Redevelopment Authority in and for the City of Richfield, Minnesota, (Richfield HRA) a body corporate and politic under the laws of Minnesota having its principal place of business at 6700 Portland Avenue South, Richfield, MN 55423. Section I Scope of Services The Richfield HRA agrees to request and NKS agrees to provide Business Energy Checkup (BEC) services for owners and/or managers of .business, commercial and religious buildings of Richfield (clients) as identified by the Richfield HRA. All BEC services will be performed in compliance with Business Energy Tune-up Procedures Manual and Technical Manual established by the Minnesota Department of Public Service, Energy Division and as modified by Richfield HRA. The BEC service, determined on an audit by audit basis provides an action oriented and flexible service that documents calculafons, savings estimates, and technical criteria for owners and/or managers of small businesses. It is designed to: * Identify the three or four highest priority conservation/efficiency opportunities to improve the efficiency of its energy using systems up to 30$ or more * Provide site-specific information and instruction for the consumer in simple, clear terms to understand the results and take follow up action. * Provide consulatation in formulating a plan of action and consultation about financing * Provide a follow up with the consumer to answer further questions and assist as necessary with implementing the plan of action. The Richfield ,Business Energy Checkup consists of: 1. Utility bill analysis 2. Site visit for; a. Interview with the consumer b. Information gathering tour of the facilities 3. Report Preparation 4. Report presentation 5. Follow up contact to further assist the consumer The Richfield Business Energy Checkup targets educating the consumer about energy bills, demand charges, power factors and pertinent rate information as well as a review of the following energy use systems: * Lighting * Ventilating * Air conditioning * Space heating * Water heating * Building envelope * Machinery use * Process use The final feature of the Richfield BEC consists of appropriate referrals for additional expert services. These referrals include further diagnostic expertise, .as well as contractors and finance programs for implementation of the recommendations. The BEC's will be completed within 30 days from the date NKS receives a BEC Assignment and appropriate consumption data documentation from the Richfield HRA. Section II Workmanship It is the intent of both parties that BEC services under this agreement be performed with the highest applicable standards of workmanship.- Both parties recognize that the service provider will represent both the Richfield HRA and NKS. The quality and workmanship of the services to Richfield residents will be monitored and maintained at the high standards mutually agreed upon by the parties. All NKS employees will adh~ of Ethics for Professional Consultants(Exhibit # A Conference of Local Energy employees will be .screened these standards. sre to the Analyst Standards and Code Energy Coordinators. and as adopted by the Minnesota Officals (CLEO). Prospective NKS by NKS for their ability to abide by Both parties shall be free to observe the performance of employees in field conditions to monitor conformance with the standards identified in this agreement. Section III Training and Certification For. Richfield BEC services,~NKS will use only analysts who have passed the State of Minnesota approved Minnesota Commercial Energy Auditor Training Course and State of Minnesota examination and who are knowledgeable and experienced in commercial audit procedures. This provision shall not restrict the Richfield HRA's right to have an auditor trainee and/or a Richfield IiRA representative present at the audit, with client notification .and prior notification to NKS. Section IV Scheduling NKS will provide staff to schedule BEC services within NKS regular business hours and at the convenience of the client, upon receipt of an assignment .from the Richfield HRA. NKS will make audit schedules available to the staff of the Richfield HRA on a weekly basis. Section V Obiectives From June 17, 1991 through September 30, 1992, the. Richfield HRA goal shall be to contract with NKS to complete approximately 50 BEC's. The Richfield HRA shall make best efforts to provide NKS with sufficient numbers of audit requests to allow for the completion of 50 BEC's during the agreement period. The Richfield HRA, to maintain a consistent flow of audit requests, shall implement marketing when necessary to meet the aforementioned target figure of 50 HEC's._ The Richfield HRA shall inform NKS of .marketing plans and other factors that can be expected to significantly influence the number of audit requests provided to NKS by the Richfield HRA during the term of this. contract. Section VI Compensation and Billing Compensation; Richfield Business Energy Checkup - Provides approximately 6 to 10 hours of labor and shall be billed at a rate of $ 125.00 each. These services shall include, but not be limited to, consultation. and coordination with Richfield HRA staff, and analysis within the scope of a typical BEC. NKS project manager and analysts will meet with Richfield HRA staff for two (2) meetings, one meeting is to be scheduled after completion of the first 6 BEC's and again during the month of March 1992. 'The NKS project manager, scheduler, and all analysts shall attend the meetings at no charge. Billing: NKS will submit to the Richfield HRA an invoice identifying completed BEC'S Services, on a aonthly basis. Invoices will be submitted to Richfield HRA staff by the 5th of each month. The Richfield HRA will pay such invoices on the Tuesday immediately following the third Monday of the month, provided the invoices are received from NKS by the 5th day of the month. Interest at the rate of 8 percent per annum may be charged by the NKS on statements that are delinquent more than 30 days. Otherwise no interest will be charged by the NKS. Section VII~Statu of NKS In the performance of this agreement, NKS will act as an independent contractor and not as an employee of the Richfield HRA. Section VIII Liability and Idemnification . r NKS shall indemnify. and hold harmless the Richfield HRA against any and all claims for loss, judgement, liability or expense for damage to any property or for death or injury to any person caused by or arising from the acts or omissions or willful misconduct of NKS, its agents and employees, during the 'term of this agreement. The Richfield HRA agrees to indemnify and hold harmless the NKS against any and all claims for loss,. judgement, liability, or expense for damage to any property or for death or injury to any person caused by, or arising from the acts or omissions, of its agents and employees with regard. to the contents or provisions of all documents, forms, or supplementary materials described above which the Richfield HRA may provide. Upon reasonable proof of an incomplete, inaccurate, or incorrect delivery of an audit service by NKS, NKS's responsibility to the Richfield HRA shall be to, upon request of the Richfield-HRA, repeat the appropriate service or to otherwise make the service accurate, correct, and complete at no additional charge. Section I defines the Scope of Services from which the determination of accurate and complete service will be determined. This section shall be controlling with respect to liability and indemnification and shall take precedence over all prior agreements, whether written or oral and all subsequent agreements unless in writing and signed by both parties. Section IX Insurance NKS shall provide and maintain the following types and minimum limits of liability insurance coverages during the performance of this agreement: - Workers Compensation and Employer's Liability Insurance in accordance with the applicable statutory requirements. - General Public Liability Insurance (Broad Form) with a minimum limit of $1,000,000 combined single limit per occurrence. - Automobile Liability Insurance (including owned, hired, and non-owned vehicles) with a minimum limit of $1,000,000 combined single limit per occurrence. Evidence of insurance shall be provided to the Richfield HRA within 30 days of the effective date of this agreement. Section X Validation of Performance For each audit completed, NKS will provide the RICHFIELD HRA with a completed copy of: 1. The Richfield BEC forms 2. Quick Check forms 3. Fuel. consumption data Section XI Eq~pment All equipment owned by NKS and used by the analysts shall be in good operating condition, with proper calibrations and adjustments made on a routine bests as recommended by the manufacturer and/or distributor. NKS is responsible for the. calibrations and adjustments.. The Richfield HRA will supply NKS with the following equipment, depending upon availability, for use completing Richfield SEC's: * One (1) Energy Teller * One (1) Annometer * One (1) Minneapolis Smoke Bottles * One (1) Digital Temperature/Humidity Gauge * One (1) Light Meter All equipment will be kept safe, properly insured for loss or damage, and operated in a proper manner by NKS personnel. All equipment owned by the Richfield HRA and used by the analysts shall be in good operating condition, with proper calibrations and adjustments made on a routine basis, as recommended by the manufacturer and/or distributor. Richfield HRA is responsible for the calibrations and adjustments provided the analysts incorrect operation or careless handling is not the reason for calibration and adjustment. Section XII Scope of Agreement This .agreement shall in no way restrict the Richfield HRA's right to elect to have ndditional audits performed by another body, agency, or individual; specifically, but not limited, to Northern States Power, Minnegasco, or a representative-of the Richfield HRA. Section XIII Terms of Agreement This agreement will be in effect through September 30, 1992. ion XIV Cancellation This agreement is subject to cancellation by either party 30 days after written notice of intent to cancel is delivered to the other party. Notices shall be sent to: Lorene Lehmann Energy Programs Richfield Housing ~ Redevelopment Authority 6700 Portland Avenue South Richfield., MN 55423 and/or E. Norm Harold NKS Consulting, inc. 5591 East 180th Street Prior Lake, MN 55372 Section XV Renewal This agreement may be extended if agreed in writing by both parties. IN TESTIMONY WHEREOF, the parties hereto have set their hands as of the day and year first above written: HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD NKS CONSULTING, INC. ames D. Prosser City Manager,"HRA Executive Director Thomas E. Harmes, HRA Chair E. Norm Harold President <energy>BECfile EXHIBIT A AUDITOR STANDARDS CODE OF ETHICS AUDITOR STANDARDS. All analysts are understood to be representing the Richfield Housing and Redevelopment Authority and at all times exhibit the high standards outlined below: *Sensitivity to the conservation-related questions asked by, and concerns expressed by, the client. *Ability to relay easily, clearly, and in simple language the conservation measures and life-style changes which will have the greatest impact on energy consumption. *Sensitivity to the physical and mental stresses to which a client may be subject in the course of auditing and a willingness to act to minimize these stresses and mitigate their effects. *Respect for the privacy of the clients and their property *Ability and willingness to maintain a neat and clean personal appearance and maintain order and cleanliness in the furnishings and facilities of the business units visited. *Ability and willingness to provide services without regard to race, religion, nationality, sex, age, or sexual preference Code of Ethics Professional Ener~- Coordinators and Consultants (Auditors) Ethical behavior results not from edict,, but from a personal commitment of the individual. This code is offered to affirm the. discipline and enthusiasm .of all energy professionals to be ethical and to act ethically in all that they do as energy conservation professionals. In subscribing to the standards below, the energy professional is expected to view ethical responsibility in as inclusive a context as each situation .demands. The energy professional is expected to take into consideration the principles below that have a bearing upon any situation in which ethical judgement is to be exercised and professional conduct is planned. The course of action that the energy professional chooses is expected to be consistent with the spirit as well as the letter of these standards. 1. The energy professional should maintain high standards of personal conduct in the capacity or .identity as ene7['gy professional.. a. The private conduct of the energy professional is a personal matter to the same degree as is any other person's, except when such conduct compromises the fulfillment of professional responsibilities. b. The energy professional should not participate in, condone, or be associated with dishonesty, fraud, deceit, or misrepresentation. 2. The energy. professional should act in accordance with the • highest standards of professional integrity. a. The energy professional should be alert to and resist the influences and pressures that interfere with the exercise of professional discretion and impartial judgement required for the performance of professional functions. b. The energy professional should not exploit professional relationships for personal gain. 3. The energy professional's primary responsibility is to his or her clients. a. The energy professional should not exploit relationships with clients for personal advantage. b. The energy professional should not practice, condone, facilitate of collaborate with any form of discrimination on the basis of race, color, sex, sexual orientation, age, religion, national origin, marital status, political belief, mental or physical handicap, or any other preference or personal characteristic, condition or status. c. The energy professional should avoid relationships or commitments that conflict with .the interests of clients. d. The energy professional should provide clients with accurate and complete information regarding the extent and nature of the energy conservation option's and services available to them. e. The energy professional should .seek. advice and counsel of colleagues and supervisors whenever such consultation is in the best interest of clients. 4. The energy professional should strive to become. and remain proficient in professional, practice and the performance of professional functions. a. The energy professional should accept responsibility or employment only on the basis of existing competence or the intention to acquire the necessary competence. b. The energy professional should not misrepresent professional qualification, education, experience, or affiliations. 5. The energy professional should uphold and advance the integrity of the profession. a. The energy professional should protect and enhance the dignity and integrity of the profession and should be responsible and vigorous in discussion and criticism of"-the profession. b. The energy professional should take action through appropriate channels against unethical conduct by any other member of the profession. c. The energy professional should act to prevent the unauthorized and unqualified practice of the profession. d. The energy professional should make no misrepresentation in advertising as to qualifications, competence, service, or results to be achieved. 6. The energy professional should treat colleagues with respect, courtesy, fairness, and good faith. 7. The energy professional should take responsibility for identifying, developing, and fully utilizing knowledge for professional practice. a. The energy professional should base practice upon recognized knowledge relevant to the profession. b. The energy professional should critically sxamine and keep current with emerging knowledge relevant to the .profession. c. The energy professional should contribute to the knowledge base of the profession and-share research knowledge and practical wisdom with colleagues. HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 18 Agenda June 17, 1991 Issue Statement• Authorization to submit an Alternative Conservation Improvement Plan (CIP) to the Minnesota Department of Public Service (MNDPS) to provide a creative alternative for the funding of Home Energy Checkups. Background• The HRA's award winning Bundle-Up Richfield energy program has provided home energy audit services for approximately eight years. The most recent audit program, called the Home Energy Check Up (HEC), has been available for five years and has served approximately 3,000 of Richfield's 10,000 single family homes. Over the years, the audit has provided a package of evaluative and educational services which are paid for primarily by NSP and to a lessor extent by Minnegasco. In the last two years, the scope of service has been reduced due to a 33$ reduction in revenues for the service from NSP. Energy program administration is paid for by MNDPS grants and City general funds. Approximately $30,000 in City general funds have been used to pay administration costs of this program on an annual basis. As part of the most recently received MNDPS grant, staff has developed several new concepts in energy audit services. One new concept is called a "blended" HEC; a sharing of services and costs by NSP and Minnegasco which includes contributions to the HRA for administration and marketing. Another concept is "continuing support" HEC audits. The two audit type services will provide blower door test services and furnace test services for residences. For the "blended" and "continuing support" HEC concept to be evaluated and, if possible, funded, the MNDPS has devised a plan and process called the Alternative CIP. With HRA authorization, this concept would be submitted for MNDPS consideration. MNDPS would respond by seeking utility input, and then making a determination as to whether the utilities should support the proposal and at what level of funding. To summarize, the proposal calls for: • Funding of audits starting in the fall of 1991 through the fall of 1993. • Providing $388,000 for 2,400 audits and related marketing and administration over a two year period. (The program is presently providing this volume of service). • A comprehensive service which provides for house inspection, on site analysis of improvement needs and payback potential, analysis of heat and air conditioning loss, and a package of materials which homeowners can install to reduce utility costs. • Increased utility funding for administration of this program. Recommended Motion: Authorize submitting an Alternative Conservation Improvement Plan to the Minnesota Department of Public Service in support of a new energy audit service concept. Basis for Recommendation: 1. The HRA is the responsible agency for initiating energy program proposals on behalf of the City of Richfield. 2. It would provide funds to market and administer the program. Neither utility has provided administrative or marketing funds in the past and this change could reduce reliance on the City's general fund. 3. These energy program services are beneficial to the City because they would reduce energy consumption and also improve housing stock as audit recommendations are implemented. Alternative Recommendation: 1. Do not authorize submitting an Alternative Conservation Improvement Plan to the Minnesota Department of Public Service. The present audit service in cooperation with NSP, would continue to be available. Discussion/Decision Mode: If the HRA authorizes submitting an Alternative Conservation Improvement Plan, when completed, it would be forwarded to MNDPS for their consideration. Agreements with NSP and Minnegasco would have to be considered by the HRA prior to program implementation. Respectfu submitted, James D. Prosser Execu a Director JDP:ds RESOLUTION NO. A RESOLUTION AUTHORIZING SUBMISSION OF AN ALTERNATIVE CONSERVATION IMPROVEMENT PLAN TO THE MINNESOTA DEPARTMENT OF PUBLIC SERVICE WHEREAS, the Richfield HRA is responsible for administering residential energy conservation programs on behalf of the city; and WHEREAS, the Conservation Improvement Program was created by the State of Minnesota for the purpose of .developing and delivering programs which conserve and preserve energy resources; and WHEREAS, the Minnesota Department of Public Service is responsible for considering Conservation Improvement Plans submitted on behalf of cities and public utility companies in response to Conservation Improvement Programs; and WHEREAS, the "Blended Home Energy Check-Up Alternative Proposal" would be submitted to the Minnesota Department of Public Service; and WHEREAS, the Proposal calls for a contribution of $388,000 from Northern States Power and Minnegasco during the period 1991- 93 to provide Home Energy Check-Up services; and WHEREAS, the HRA has had an opportunity to consider the Plan. NOW, THEREFORE, BE IT RESOLVED, by the Housing and Redevelopment Authority of Richfield as follows: 1. The Executive Director and Chair are authorized to submit an Alternative Conservation Improvement Plan to the Minnesota Department of Public Service and to respond as necessary to effectuate the approval of the Plan. Passed by the Housing and Redevelopment Authority of Richfield, Minnesota this 17th day of June, 1991. Thomas E. Harms, Chairperson ATTEST: Joan Helmberger, Secretary HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 17 Agenda June 17, 1991 Issue Statement• Authorization to execute contracts with South Hennepin Vocational Technical School (Vo-Tech) to initiate two 1991-92 projects. Background• Vo-Tech has requested that the HRA participate in two new projects for the school year 1991-92. The two organizations have participated together in 15 projects since 1977. The projects provide rehabilitation and new construction training opportunities for the Vo-Tech students and affordable housing for the HRA. The 1991-92 projects would include remodeling the structure at 6318 Nicollet and constructing a new single family house at 6803 Nicollet (to be known as 6801 Nicollet when building permits are applied for). 6318 Nicollet The property at 6318 Nicollet was purchased by the HRA in January, 1991. (The HRA considered a rehabilitation project concept in April, 1991; refer to HRA Letter No. 9, April 15, 1991. Attached to this letter is a graphic representation of the rehabilitation and new construction cost comparison discussion from the April meeting). The property, under absentee ownership, has been a serious source of maintenance problems for years. Staff, in cooperation with Vo-Tech architectural drafting faculty, has developed plans to rehabilitate the structure. Improvements will include the removal of the existing garage and breezway, the construction of a new two-car garage, and interior and exterior remodeling and repair. Upon completion, the house will have new siding, a new roof, updated electrical, plumbing and heating systems, and finished landscaping, in addition to other general improvements. The amount of the Vo-Tech contract for this project is $38,761 (this is approximately $3,861 higher than estimated). The project is anticipated to begin in July, 1991. Completion is anticipated for August 1, 1992 with a sale to follow. In April, 1991, the HRA authorized staff to apply for $20,000 in funding from the Federal Home Loan Bank of Des Moines, Iowa. This 520,000 would be treated as a second mortgage for pay back purposes. It is non-interest bearing and would be due upon sale of the property by the initial buyer unless sold to a moderate income family. The HRA would contribute an additional $20,000 as a rehabilitation grant. (This number must now be modified to $23,861). HRA and bank funds would be applied to rehabilitation costs. The final sale price would be $75,000; a first mortgage of $55,000 and a second mortgage of $20,000. Availability of these bank funds to the HRA has not yet been established. Notification is expected about mid June, but possibly not until after the HRA meeting. If this funding is not received, the sale price would remain at $75,000 but a second non-interest mortgage would be unavailable. 6803 Nicollet The purchase of 6803 Nicollet is pending HRA consideration at the June 17 HRA meeting. If purchase is authorized, it is appropriate to consider the redevelopment of the site. Staff, in cooperation with Vo-Tech architectural drafting faculty, has developed project plans to meet all setback requirements, compliment the design of neighboring homes and incorporate interior features desirable in today's market. The new home will be similar to the Vo-Tech project nearing completion at 7101 First Avenue. The new house will be built on-site and have approximately 1,350 square feet of finished living area. It will feature, on the first level; a living room, kitchen, dining area, family room, full bath and two bedrooms. The lower level will contain a third finished bedroom, a 3/4 bath and unfinished space. In addition, an exterior deck adjacent to the dining area and a parking pad with access from 68th Street will be provided. Completion is projected for August 1, 1992. A sale would follow. The amount of the Vo-Tech contract for the new construction project is 562,840. This is slightly higher than the similar project at 7101 First. The increase is the result of general cost adjustments and the sewer availability charge (SAC) required for this non-sewered property to be used for a new home. Upon completion, the sale price would be $80,000. A neighborhood meeting generated some concern by an adjacent neighbor. The neighbor wanted to buy the property but wasn't able to arrange financing during the last six months. He does like the look and siting of the proposed house. However, he prefers the lot to be combined with his existing parcel and left open and undeveloped. Both the homes will be sold to first time home buyers. The 6318 Nicollet home will be sold to a two to three member family with an annual income approximating $20,000 - $30,000 with the bank funding. If the bank funding is not available, the income would need to be higher as there would be no second mortgage. The first mortgage would be $75,000. The 6803 Nicollet project will be sold to three to six member family with an annual income approximating $29,000 to $41,000. These income limits are 80$ of metropolitan area median income as determined by HUD. Reduced interest rate mortgages would be secured from the Minnesota Housing Finance Agency if available at the time of sale. FHA financing is an acceptable alternative subject to mortgage interest rates at the time. _ A summary of project costs and funding sources for each project is attached. Legal Counsel has previously reviewed the contract requirements. A copy of floor plans and building elevations for each project also accompany this letter. Recommended Motion: It is recommended that the HRA adopt the attached resolution authorizing the Executive Director and Chair to: 1. Execute a Vo-Tech contract in the amount of 538,761 for the 1991-92 remodel project at 6318 Nicollet. 2. Execute a Vo-Tech contract in the amount of 562,840 for the 1991-92 new construction project at 6803 Nicollet. Basis for Recommendation: 1. Plans have been developed to meet site requirements and program needs of the HRA. 2. Site development is consistent with the Comprehensive Plan, no variances are needed. 3. Adjoining neighbors to both sites have had an opportunity to review the projects with staff and indicated support with the exception as noted. 4. The projects are consistent with previous Vo-Tech projects. 5. Adequate funding is available to support these projects. Alternative Recommendation: 1. Do not authorize execution of the Vo-Tech contracts. This would delay development which would prohibit Vo-Tech from including the projects in their 1991-92 curriculum schedule. 2. Approve only one of the projects. Discussion/Decision Mode: The Vo-Tech is ready to begin construction on both sites this summer. Respectf ly submitted, Jame Prosser Exec' ive Director JDP:ds Attachment RESOLUTION NO. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD RESOLUTION AUTHORIZING CONTRACTS WITH VO-TECH WHEREAS, the Housing and Redevelopment Authority (HRA) has acquired the real properties at 6318 Nicollet Avenue and anticipates acquiring the real property at 6803 Nicollet, legally described as: Lot 4, Block 8, "Nicollet Homes Addition;, and Lot 1 and 2, the Western Surety and Adjustment Company addition "The Pines", respectively; and WHEREAS, a project has been proposed for each site in cooperation with South Hennepin Vocational Technical Center (Vo- Tech); and WHEREAS, the contract price for the rehabilitation of the project at 6318 Nicollet Avenue will not exceed $38,761; and WHEREAS, in resolution number 415, from April 15, 1991, the HRA made funds available for rehabilitation from the Expanded New Home Program for 6318 Nicollet; and WHEREAS, additional funding is available from the proceeds of sale, Expanded New Home Program and possibly the Federal Home Loan Bank; and WHEREAS, the property at 6803 Nicollet Avenue would be developed with new construction with a contract price not to exceed $62,840 to be funded by proceeds of sale; and WHEREAS, following completion of the rehabilitation and new construction work, the properties would be sold to a first time homebuying, moderate income family. NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority of Richfield, Minnesota that the HRA Chairperson and Executive Director are authorized to: 1. Enter into a construction contract for an amount of $38,761 for the rehabilitation project to be completed at 6318 Nicollet Avenue and funded as indicated. 2. Enter into a construction contract for an amount of $62,840 for the new construction project at 6803 Nicollet Avenue funded as indicated. Passed by the Housing and Redevelopment Authority of Richfield, Minnesota this 17th day of June, 1991. Thomas E. Harms, Chairperson ATTEST: Joan Helmberger, Secretary COMPARISON OF REHABILITATION AND NEW CONSTRUCTION PROJECT ALTERNATIVES 6318 NICOLLET Rehabilitation of Property New Construction At Property $55,000 - Acquisition/HRA $55,000 - Acquisition/HRA 543,861 - Rehabilitation/HRA/ $65,000 - New Construction Vo-Tech/FHLB 5 5,000,- Demolition $98,861 - Project Total $125,000 - Project Total Sale of Property IF: HRA/Federal Bank $55,000 Sale Proceeds $20,000 Deferred Loan to Bank 523,861 HRA/ENHP Grant $98,861 Project Rev. Net Loss: $23,861 Grant Sale of Property IF: HRA (Bank Funds not approved) $75,000 Sale Proceeds $23,861 HRA/ENHP Grant $98,861 Project Rev. Net Loss: $23,861 Grant Sale of Property IF: HRA New Const. $75,000 Sale Proceeds $50,000 HRA/ ENHP Grant $125,000 Net Loss: $50-,000 Grant * The higher the sale price above $75,000 the more difficult the sale. 6318 Nicollet ~- I. With bank loan Sale Price: $75,000 Sources of funds: ENHP $ 5.5,000 1 2.3,861 2 Bank 20,000 3 Total 5.98,861 II. Without bank loan Sale Price: $75,000 Sources of funds: ENHP $ 55,000 1 23, 861 4 20;000 Total $ 98,861 Use of funds: Use of funds: Acquisition $ 55,000 Acquisition $ 55,000 Vo-Tech 38,761 Vo-Tech 38,761 Landscape 2,500 Landscape 2,500 Legal 600 Legal 600 Closing Costs 2,000 Closing Costs 2,000 Total $ 98,861 Total $ 98,861 1 Funds recovered through the buyers first mortgage at time of initial sale. 2 Rehabilitation grant 3 Funds provided by Federal Home Loan Bank which would be recovered by the bank through a second mortgage at time of resale by initial purchaser unless sold to another moderate income family. 4 .Funds provided by ENHP which would be recovered upon initial sale through the buyers first mortgage. 6803 Nicollet Sale Price: $80,000 Source of funds: CDBG $.25,800 Sales Revenue $ 80,000 Total $105,800 Use of funds: Acquisition: $23,000 Demolition 1,000 Environmental Review 1,800 Vo-Tech 62,840 Landscape. 3,500 Legal 600 Closing Costs 2,800 Total $95,540 Revenue Balance $10,260 1 1 Any balance not'used to fund unexpected expenses would be returned to HRA budget. t 1 ' { ' 1 1., '~i~t i! 1 1 ~ j 1 1; ~ ;~, 11; .1 .1 I ! . 1~ 1', •,' '71 ~ t .' ' ' •~: •~1~~ t. i 1 l~ 1 , r •t i, i 1~ 1 1' 1 f .i~i~ .~' ', ! ~ ~ 1 , ~. ( . 11 ~, ~~ I ' ! J .~.. O ~ .. :':i' ~, ' ~, ~. • , r ~ •~ :~ 1 i11! ! li I ~ i~L i I ' ! ; 1 ' I i=- ~~~ } 1 ~~L ' r, ;ill :' ! ~~ , .., :. ,- ! .,• ~ , ~~•, ~i !!!' Ij':li'I •~ i+~ ,,t +1j ;1 i ,~ 1~ _ _ • 1 ~ ~i~ 1 i. '` [~ • C o •~ I'~) ~: tip ' ~ ., ~~ o ~~ a °, ~'. ~ .. ~~ 1,. . Lei a~I ~, t~ l'~ , ~~ W ~' ~~ 1Lt ail z~ ui a W J J 0 U Z 0 00 c~ •J N Iii. Z' O a W~ J W N ~. Z 0 a W J W Q W Z 4 W J W H W W J i `~ Z Q J a oc O 0 J LL J W W J W J Z Q J a o~ O 0 J LL J W W J Z DRAFT CONSTRUCTION AGREEMENT AGREEMENT made on this 17th day of June, 1991, by and between the Housing and Redevelopment Authority in and for the City of Richfield, State of Minnesota, hereafter referred to as "Housing Authority", and Intermediate District 287 (Hennepin Technical College) hereinafter referred to as "School District", both governmental units organized and existing pursuant to the laws of the State of Minnesota. WHEREAS, the "Housing Authority" is undertaking certain redevelopment activities in the City of Richfield and State of Minnesota by which it acquires certain properties for development of housing. WHEREAS, "School District" is a vocational-technical school offering courses in building trades and training men and women to be competent employees in all fields of construction. WHEREAS, the "Housing Authority" is the owner of certain property which is known as 6803 Nicollet Avenue, Richfield, MN. hereinafter referred to as "the premises". WHEREAS, the "Housing Authority" desires to contract "School District" to construct a new single family residence on "the premises" and "School District" desires to so contract in accordance with the terms, covenants, and conditions hereinafter set forth. NOW, THEREFORE, in the consideration of the mutual covenants. ' and agreements herein contained, the parties do hereby covenant and agree as follows: 1. General Scope of Work. "School District" shall furnish all of the labor and materials and perform all of the work within and on "the premises" as set forth in the plans, specifications and lists of materials, hereinafter collectively referred to as "the plans". Copies of "the plans", initiated by each of the parties hereto are in the possession of each of the parties and are being incorporated in this agreement to the same extent and effect as if such plans were fully set out herein. "The plans" had been prepared by "School District" at the request of the "Housing Authority" and describe the work desired by the "Housing Authority" and has been approved by it. "School District" undertakes to perform all the necessary work and to furnish all the necessary materials in order to erect on "the premises" a single family residence as described in "the plan". 2. Independent Contractor. "School District" represents to the "Housing Authority" that it is a vocational-technical school and that students of the school will perform the work provided for herein and that those students will be properly supervised by the instructional staff of "School District". "School District" shall finance its own operations hereunder, shall operate as an independent contractor and not as the agent of the "Housing Authority" free and harmless from all liabilities, costs and charges by reason of any act, omission, or representation of "School District" or of its subcontractors, agents, or employees. 3. Contract Price. The total contract price for all work, materials and labor to be furnished and performed by "School District" hereunder shall be its direct materials and supplies cost but limited to no more than 562,840.00. 4. Method of Payment. It is understood that the "Housing Authority's" agreement with "School District" provides that "School District" will advance monies to finance the work hereinabove referred to. The full contract price shall be payable by the "Housing Authority" to "School District" upon completion and acceptance of the work and after the property has been sold by the "Housing Authority". Payment shall be made only upon presentation of documentation sufficient, in the opinion of the "Housing Authority", to support such claim for payment. At the time of closing, "School District" will also provide the "Housing Authority" with a sworn construction statement and mechanic's lien and materials waivers as per 4A. In the event "School District" shall fully perform its obligations within the time limit contained in paragraph 5 of this agreement, final payment shall be made not later than September 1, 1992. 4A. Guarantee Against Mechanics Liens. "School District" warrants and guarantees that all subcontractors, materialmen, and any other persons performing labor or services shall be promptly paid in accordance with their respective contracts and "School District" warrants and guarantees that it shall protect and hold harmless the "Housing Authority" against any claims or mechanic's liens and lawsuits or foreclosures thereof. The "School District" shall furnish the following to the "Housing Authority" at the time of payment. a. A sworn construction statement listing all subcontractors and materialmen who performed work or supplied material under this contract and the amounts of their subcontract or material. b. Lien waivers from all subcontractors and materialmen listed in Subparagraph (a) above for all work listed thereon. c. General lien waiver and indemnity whereon "School District" agrees to waive all liens for work done pursuant hereto and to indemnify and hold harmless the "Housing Authority" from all claims for mechanic's liens by virtue of all work done to fulfill "School District's" obligations hereunder. .' 5. Time for Completion. "School District" shall commence performance of its obligations under this agreement immediately and "School District" shall complete the work described herein in accordance with "the plans" not later than August 1, 1992. Date shall be extended by delays beyond "School District's" control. Authorization to extend this date must be received by the . "Housing Authority" prior to July 1, 1992. 6. Best Efforts of "School District". Notwithstanding the time set forth in paragraph five hereof for completion of construction, "School District" will at all times exert its best efforts to complete construction at the earliest possible time, will at all times furnish sufficient labor and materials to assure the most efficient and speediest construction progress. Efforts must first be directed to completion of the exterior facade and maintaining a presentable exterior acceptable to the "Housing Authority". This, in addition to timely construction, requires minimizing the outside storage. of equipment and material and the routine removing and disposing of debris located on "the premises". 7. Insurance. "School District" shall at all times, commencing with the date upon which construction begins, carry the following types of insurance with an insurance carrier or carriers as follows: a. Worker's Compensation Insurance fully covering all employees engaged in the performance of this agreement in accordance with Minnesota law. The "School District" will require its subcontractors to provide evidence of Worker's Compensation Insurance on their employees. In the event of injury to student(s) of "School District" engaged in the performance-of this agreement, "School District" agrees to hold harmless the "Housing Authority". b. Public Liability Insurance covering death or bodily injury with limits in accordance with the laws of the State of Minnesota for independent school districts. c. Risk Insurance against damage or destruction by fire and full extended coverage including vandalism and malicious mischief; covering all improvements to be erected hereunder and all materials which are on or about "the premises", in an amount equal to the full insurance value of such improvements. Evidence of insurance should be provided within 30 days of the date first set forth in this agreement. 8. .Correcting of Defects. Upon completion of the work to be performed under this agreement, "School District" shall request payment of the contract prices. The "Housing Authority" shall then inspect "the premises" and, in the event the contract ' has been fully performed by "School District", make payment of the contract price. In the event such inspection discloses, in the opinion of the "Housing Authority", any defect in materials or workmanship, or any failure to perform the work covered by. this agreement, the "Housing Authority" shall so notify "School District" in writing. Thereafter, "School District" shall have 20 working days to correct or remedy such defect or failure, and upon proof of such, receive payment for the "Housing Authority". An extension needed to correct or remedy a mayor defect past 20 working days must be authorized by the "Housing Authority". If such a defect or failure is not corrected or remedied within such period, the "Housing Authority" shall determine the cost of such correction or remedy, shall deduct such amount from the contract price and shall pay the balance to "School District" upon receipt of the documentation described in paragraph 4 of this agreement. 9. Statutory Warranty. As "vendor" (seller) of the single- family dwelling structured at 6803 Nicollet Avenue, Richfield, MN the "Housing Authority" shall warrant to all applicable owners the following warranty pursuant to Minnesota Statutes 327 A, in part described as: Subdivision 1. Warranties by vendor. In every sale of completed dwelling, and in every contract for the sale of a dwelling to be completed, the vendor shall warrant to the vendee that: a. During the one-year period from and after the warranty date, the dwelling shall be free from defects caused by faulty workmanship and defective materials due to noncompliance with building standards. b. During the two-year period from and after the warranty date, the dwelling shall be free from defects caused by faulty installation of plumbing, electrical, heating, and cooling systems; and c. During the ten-year period from and after the warranty date, the dwelling shall be free from mayor construction defects. The "Housing Authority" shall refer all claims of statutory warranty to "School District" which shall inspect same and where appropriate make repair or replacement. "School District" shall indemnify and hold harmless the HRA from all claims and actions rising out of the statutory warranty. 10. Approvals. "School District" shall secure the approval of the "Housing Authority" as to "the plans", before commencement of construction. "School District" shall furnish to the "Housing Authority" a complete listing of all contractors and subcontractors which it intends to utilize in the course of the construction referred to herein. "School District" agrees this agreement is not assignable. 11. ADDlicable Law. All parts of this agreement shall be interpreted in accordance with the laws of the State of Minnesota. 12. Cooperation Between the Parties. The parties shall cooperate with each other in the performance of any work required to be performed by them respectively, to the end that neither shall cause the other any delay or interfere with the performance of the work of the other in any manner whatsoever. IN WITNESS WHEREOF, the parties hereto, pursuant to proper authority as granted by the governing boards of the parties hereto, have caused this agreement to be executed by their proper an duly authorized officers the day and year first above written: HOUSING AND REDEVELOPMENT AUTHORITY INTERMEDIATE DISTRICT #287 IN AND FOR THE CITY OF RICHFIELD, MN (HENNEPIN TECHNICAL COLLEGE) BY ITS EXECUTIVE DIRECTOR ITS CHAIR ITS CHAIR ITS CLERK EEMENT ®R AFT CONSTRUCTION AGR AGREEMENT made on this 17th day of June, 1991, by and between the Housing and Redevelopment Authority in and for the City of Richfield,. State of Minnesota, hereafter referred to as "Housing Authority", and Intermediate District 287 (Hennepin Technical College) hereinafter referred to ws "School District", both governmental units organized and existing pursuant to the laws of the State of Minnesota. WHEREAS, the "Housing. Authority" is undertaking certain redevelopment activities in the City of Richfield and State of Minnesota by which it acquires certain properties for development of housing. WHEREAS, "School District" is a vocational-technical school offering courses in building trades and training men and women to be competent employees in all fields of construction. WHEREAS, the "Housing Authority" is the owner of certain property which is known as 6318 Nicollet Avenue. Richfield, MN. hereinafter referred to as "the premises". WHEREAS, the "Housing Authority" desires to contract "School District" to construct certain improvements at "the premises" and "School~District" desires to so contract in accordance with the terms, covenants, and conditions hereinafter set forth. `, NOW, THEREFORE, in the consideration of the mutual covenants and agreements herein contained, the parties do hereby covenant and agree as follows: 1. General Scope of Work. "School District" shall furnish all of the labor and materials and perform all of the work within and on "the premises" as set forth in the plans, specifications and lists of materials, .hereinafter collectively referred to as "the plans". Copies of "the plans", initiated by each of the parties hereto are in the possession of each of the parties and are being incorporated in this agreement to the same extent and effect as if such plans were fully set out herein. "The plans" had been prepared by "School District" at the request of the "Housing Authority" and describe the work desired by the "Housing Authority" and has been approved by it. "School District" undertakes to perform all the necessary work and to furnish all the necessary materials in order to rehabilitate on "the premises" the single family residence as described in "the plan". 2. Independent Contractor. "School District" represents to the "Housing Authority" that it is a vocational-technical school and that students of the school will perform the work provided for herein and that those students will be properly supervised by the instructional staff of "School District". "School District" shall finance-its own operations hereunder, shall operate as an independent contractor and not as the agent of the "Housing Authority" free and harmless from all liabilities, costs and charges by reason of any act, omission, or representation of "School District" or of its subcontractors, agents, or employees. 3. Contract Price. The total contract price for all work, materials and labor to be furnished and performed by "School District" hereunder shall be its direct materials and supplies cost but limited to no more than X38,761.00 4. Method of Payment. It is understood that the "Housing Authority's" agreement with "School District" provides that "School District" will advance monies to finance the work hereinabove referred to. The full contract price shall be payable by the "Housing Authority." to "School District" upon completion and acceptance of the work and after the property has been sold by the "Housing Authority". Payment shall be made only upon presentation of documentation sufficient, in the opinion of the "Housing Authority", to support such claim for payment. At the time of closing, "School District" will also provide the "Housing Authority" with a sworn construction statement and mechanic's lien and materials waivers as per 4A. In the event' "School District" shall fully perform its obligations within the time limit contained in paragraph 5 of this agreement, final payment shall be made not later than September 1, 1992 4A~ Guarantee Against Mechanics Liens. "School District" warrants and guarantees that all subcontractors, materialmen, and any other persons performing labor or services shall be promptly paid in accordance with their respective contracts and "School District" warrants and guarantees that it shall protect and hold harmless the "Housing Authority" against any claims or mechanic's liens and lawsuits or foreclosures thereof. The "School District" shall furnish the following to the "Housing Authority" at the time of payment. a. A sworn construction statement listing all subcontractors and materialmen who performed work or supplied material under this contract and the amounts of their subcontract or material. b. Lien waivers from all subcontractors and materialmen listed in Subparagraph (a) above for all work listed thereon. c. General lien waiver and indemnity whereon "School District" agrees to waive all liens for work done pursuant hereto and to indemnify and hold harmless the "Housing Authority" from all claims for mechanic's liens by virtue of all work done to fulfill "School District's" obligations hereunder. 5. Time for Completion. "School District" shall commence performance of its obligations under this agreement immediately and "School District" shall complete the work described herein in accordance with "the plans" not later than August I~ 1992. Date shall be extended by delays beyond "School District's" control. Authorization to extend this date must be received by the "Housing Authority" prior to July 1, 1992. 6. Best Efforts of "School District". Notwithstanding the .time set forth in paragraph five hereof for completion of construction, "School District" will at all times exert its best efforts to complete construction at the earliest possible time, will at all times furnish sufficient labor and materials to assure the most efficient and speediest construction progress. Efforts must first be directed to completion of the exterior facade and maintaining a presentable exterior acceptable to the "Housing Authority". This, in addition to timely construction, requires minimizing the outside storage of equipment and material and the routine removing and disposing of debris located on "the premises". 7. Insurance. "School District" shall at all times, commencing with the date upon which construction begins, carry the following types of insurance with an insurance carrier or carriers as follows: a. Worker's Compensation Insurance fully covering all employees. engaged in the performance of this agreement in accordance with Minnesota law. The "School District" will require its subcontractors to provide evidence of Worker's Compensation Insurance on their employees. In the event of injury to student(s) of "School District" engaged in the performance of this agreement, "School District" agrees to hold harmless the "Housing Authority". b. Public Liability Insurance covering death or bodily injury with limits in accordance with the laws of the State of Minnesota for independent school districts. c. Risk Insurance against damage or destruction by fire and full extended coverage including vandalism and malicious mischief; covering all improvements to be erected hereunder and all materials which are on or about "the premises", in an amount equal to the full insurance value of such improvements. Evidence of insurance should be provided within 30 days of the date first set forth in this agreement. 8. Correcting of Defects. Upon completion of the work to be performed under this agreement, "School District" shall request payment of the contract prices. The "Housing Authority" shall then inspect "the premises" and, in the event the contract has been fully performed by "School District", make payment of the contract price. In the event such inspection discloses, in the opinion of the "Housing Authority", any defect in materials or workmanship, or any failure to perform the work covered by this agreement, the "Housing Authority" shall so notify "School District" in writing. Thereafter, "School District "shall have ~ 20 working days to correct or remedy such defect or failure, and upon proof of such, receive payment for the "Housing Authority". An extension needed to correct or remedy a major defect past 20 working days must be authorized by the "Housing Authority". If such a defect or failure is not corrected or remedied within such period, the "Housing Authority" shall determine the cost of such correction or remedy, shall deduct such amount from the contract price and shall pay the balance to "School District" upon receipt of the documentation described in paragraph 4 of this agreement. 9. Statutory Warrantv. As "vendor" (seller) of the single- family dwelling structured at 6318 Nicollet Avenue, Richfield, MN the "Housing Authority" shall warrant to all applicable owners the following warranty pursuant to Minnesota Statutes 327 A, in part described as: Subdivision 1. Warranties by vendor. In every. sale of completed dwelling, and in every contract for the sale of a dwelling to be completed, the vendor shall warrant to the vendee that a. During the one-year period from and after the warranty date, the dwelling shall be free from defects caused by faulty workmanship and defective materials due to noncompliance with building standards. b. During the two-year period from and after the warranty date, the dwelling shall be free from defects caused by faulty installation of plumbing, electrical, heating, and cooling systems; and c. During the ten-year period from and after the warranty date, the dwelling shall be free from major construction defects. The "Housing Authority" shall refer all claims of statutory warranty to "School District" which shall inspect same and where appropriate make repair or replacement. "School District" shall indemnify and hold harmless the HRA from all claims and actions rising out of the statutory warranty. 10. Approvals. "School District" shall secure the approval of the "Housing Authority" as to "the plans", before commencement of construction. "School District" shall furnish to the "Housing Authority" a complete listing of all contractors and subcontractors which it intends to utilize in the course of the construction referred to herein. "School District" agrees this agreement is not assignable. il. Applicable Law. All parts of this agreement shall be interpreted in accordance with the laws of the State of Minnesota. 12. Cooperation Between the Parties. The parties shall cooperate with each other in the performance of any work required to be performed by them respectively, to the end that neither shall cause the other any delay or interfere with the performance of the work of the other in any .manner whatsoever. IN WITNESS WHEREOF, the parties hereto, pursuant to proper authority as granted by the governing boards of the parties hereto, have caused this agreement to be executed by their .proper an duly authorized officers the day and year first above written: HOUSING AND REDEVELOPMENT AUTHORITY INTERMEDIATE DISTRICT #287 IN AND FOR THE CITY OF RICHFIELD, MN (HENNEPIN TECHNICAL COLLEGE) BY ITS EXECUTIVE DIRECTOR ITS CHAIR ZTS CHAIR ITS CLERK Housing and Redevelopment Authority HRA Letter No. ~6 Agenda June 17, 1991 Issue Statement• Authorization to acquire 6803 Nicollet Avenue. Background• Since 1980, the HRA has utilized the Voluntary Acquisition Program and CDBG funds to acquire substandard or underutilized residential properties for redevelopment. The Vo-Tech and private contractors have developed these sites with new housing units for moderate income families. The Nicollet Avenue property is currently underutilized and for sale. The property, owned by U.S. West Communications, Inc., contains a small brick storage shed which was previously. used for equipment storage. It has been on the market since December 1990. With a standard lot size of 50' x 127' and a location in a residentially zoned neighborhood, the lot is suitable for the development of a new single family home. An independent appraiser from BCL Appraisals, Inc. valued the property at $23,000. Staff has negotiated a purchase price of $23,000 pending authorization by the HRA. Year XVI CDBG funds are available for this purchase. The HRA would be responsible for site clearance and property maintenance following acquisition. The 1991 revised/1992 budget, provides $1,000 to clear the site (source: CDBG XVI), $600 for legal work to acquire (source: CDBG XVI) and $200 for property maintenance and insurance (source: proceeds of sale of 1991 Vo- Tech project). It is anticipated that Vo-Tech could build a new house on site starting in August, 1991. An environmental review by an independent engineering firm indicated no evidence of on site contamination. Recommended Motion: It is recommended that the HRA adopt the attached resolution which authorizes the Chairperson and Executive Director to enter into a purchase agreement and take other actions necessary to acquire 6803 Nicollet Avenue for $23,000. Basis for Recommendation: 1. The owner is interested in selling to the HRA through the Voluntary Acquisition Program. 2. The property qualifies for acquisition in accordance with the Voluntary Acquisition Program Guidelines. 3. Funds have been budgeted for acquisition, clearance, and maintenance. CDBG funds must be returned to Hennepin County if not spent prior to December 30, 1991. 4. The subject property is the only one available at this time which can be purchased given the limited funds. 5. The Planning Commission has determined the acquisition and disposition of this property for single family purposes would be in conformance with the comprehensive plan. Alternative Recommendation: The HRA can choose not to acquire the property. However, staff has no alternative for the timely expenditure of CDBG funds and the development of a future Vo-Tech project. Any alternative will likely be more costly to acquire. Discussion/Decision Mode: Pending HRA authorization, the property could be acquired in late July. Respectfully submitted James Prosser Execut a Director JDP:cak RESOLUTION NO. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, MINNESOTA AUTHORIZING THE ACQUISITION OF 6803 NICOLLET AVENUE WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA) acquires property and builds and rehabilitates structures for residential purposes; and WHEREAS, the HRA desires to acquire the real property at 6803 Nicollet Avenue, legally described as: Lot 1 and 2, The Western Surety and Adjustment Company Addition, "The Pines"; and WHEREAS, the owners of 6803 Nicollet Avenue, U.S. West Communications, have volunteered to sell their property for $23,000; and WHEREAS, Community Development Block Grant (CDBG) funds will finance the acquisition of this parcel; and WHEREAS, the Planning Commission has made a finding that acquisition and disposition of this parcel for residential purposes is consistent with the Comprehensive Plan. NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota, as follows: That the HRA Chairperson and Executive Director are authorized to take necessary actions to purchase the property located at 6803 Nicollet Avenue for $23,000. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield this 17th day of June, 1991. Thomas E. Harms, Chairperson ATTEST: Joan Helmberger, Secretary Housing and Redevelopment Authority HRA Letter No. 14 Agenda June 17, 1991 Issue Statement• Modify development agreements with Marv Anderson Homes, Inc. (Marv Anderson). Background Since September, 1990, the HRA has purchased 18 redevelopment under the Expanded New Home Progr+ HRA has entered into development agreements for with Marv Anderson. In two instances, lots are combined to provide development opportunities. Anderson has purchased 11 lots from the HRA. sites for 3m (ENHP). The each property being divided or To date, Marv The 11 properties are in various stages of construction. Agreements must be modified for nine of these properties now owned by Marv Anderson. The agreement modifications are contained in an attachment to this letter and are summarized below: 1. Extending construction deadline dates to coincide with construction progress being made by Marv Anderson. 2. Combining two agreements previously authorized by the HRA to develop 6813 Logan parcel A and B (now known as 6809 Logan). Parcel A and B have been sold by Marv Anderson to Mr. and Mrs. Morris Nilsen. An HRA memo, dated May 3, 1991 discusses the project. Anew agreement has been drafted which combines the requirements of the original two agreements and allows the development of the combined lots. 3. Minor changes to the design guidelines for lots purchased by Marv Anderson where construction is planned or underway. Recommended Motion: 1. Authorize amended construction completion dates as indicated in the attachment. 2. Authorize execution of a new development agreement for 6809 Logan. 3. Authorize minor changes to the design guidelines for 6424 James and 6809 Logan as identified in the attachment. Basis of Recommendation: 1. All properties for which agreement modifications are requested have been purchased by Marv Anderson. 2. Extensions on the construction completion dates are necessary to allow sufficient time to complete work already in progress. The extensions would not negatively impact the program. ~ 3. The current agreements for 6813 Logan parcels A and B no longer accurately represent the development for that site known as 6809 Logan. 4. Minor adjustments to the design guideline will provide more flexibility in meeting homebuyer needs while still achieving program goals. Alternative Recommendation: Do not authorize modifications to development agreements with Marv Anderson. Discussion/Decision Mode: Authorization of the agreement modifications is requested at the June 17, 1991 meeting. Respectfully submitted, James D. P osser Executiv irector JDP:cak SUMMARY AND DISCUSSION OF CONTRACT MODIFICATION I. Construction Completion Date Modification Pro pert~r Address Original Const. Completion Date Revised Const. Completion Date 1. 7145 James March 31, 1991 July 1, 1991 2. 7223 James March 31, 1991 July 1, 1991 3. 7320 Fifth March 31, 1991 July 1, 1991 4. 6425 15th March 31, 1991 August 1, 1991 5. 1016 Mildred March 31, 1991 August 1, 1991 6. 1020 Mildred March 31, 1991 August 1, 1991 7. 6424 James May 15, 1 991 October 31, 1991 8. 6813 Logan A June 30, 1991 October 31, 1991 9. 6813 Logan B June 30, 1991 October 31, 1991 Construction on the first six properties is essentially complete. The first three listed homes are already occupied by the buyers. Work in progress includes landscaping, final gas hook-ups by Minnegasco and, at 1016 Mildred, some additional interior finishing work. Revised construction dates allow sufficient time for completion of these items and inspection by HRD staff in preparation for the HRA to consider issuance of a certificate of completion. Properties number seven, eight, and nine have been pre-sold. Plans for the James site are being finalized now. Construction is anticipated to begin within 30 days. Construction has begun on the Logan site. II. New Development Agreement for 6809 Logan In January, 1991, the double lot site at 6813 Logan was purchased by the HRA. Single lots A and B were then sold to Marv Anderson. Marv Anderson has identified a buyer for the double lot and the development of a single home. The requirements of the original two development agreements have been combined into one. The new agreement recognizes: - An address change, from 6813 to 6809 Logan with appropriate adjustment to the legal description. - A house sale price of $289,948. The previous two agreements anticipated two houses priced collectively at $243,500. - HRA land proceeds from Marv Anderson for the sale of the combined site total 562,760 rather than 555,400 for two sites. - A Letter of Credit reduced from 520,548 to 513,188 given the increase in land proceeds. III. Modifications to Design Guidelines a. The Nilsen's desire to independently arrange for and finance the landscaping of their new home site. The Design Guidelines require Marv Anderson to provide finished landscaping. The Design Guidelines would be amended to exclude the installation of finished landscaping from the builder requirements at 6809 Logan. b. The purchasers of 6424 James have designed a rambler style home of their choice for the site. The plan includes the completion of two bedrooms on the main level and unfinished space in the basement level for a future third bedroom. The Design Guidelines require three finished bedrooms. The value of the proposed house at 5130,000 is well in excess of the minimum value required by the development agreement, $117,500. Housing and Redevelopment Authority HRA Letter No. 15 Agenda June 17,`1991 Issue Statement• Expanded New Home Program (ENHP) progress report. Background: The HRA received reports in February, March, and April from Marv Anderson Homes Inc. (Marv Anderson) concerning progress in developing 11 lots which were purchased from the HRA. Progress is essentially unchanged from previous reports: six sales, three models built and available for sale, and two vacant lots available for-sale (a sale of one of the model homes on Mildred Drive is close to being finalized). Equally important is the sale of an additional seven sites still owned by the HRA. These lots are to be sold to and developed by Marv Anderson, as authorized in late 1990. However, the sales to Marv Anderson are still pending. The HRA has solidly supported Marv Anderson's exclusive position to develop this housing. With the passing of time however, it has become apparent that the program needs to reach a broader market of buyers. The first time buyer market and empty nester market as well as the move-up market need to be included. In recent weeks, Marv Anderson has requested financial support from the HRA for expanded marketing efforts. They have also sought approval of some revised house plan concepts which provide greater flexibility in responding to the market. Staff is presently evaluating this request in context with the overall program. Marv Anderson's requests, a review of sales and a marketing brainstorm session provide the basis for a staff recommendation that modifications to ENHP should be initiated at this time. A closer look at sales provides the following: Address 7145 James 7223 James 7320 Fifth 6809 Logan (2 lots) 6424 James 1020 Mildred Sale Price $135,395 $137,246 $127,780 $289,948 $124,665 $122,000 (pending) Each of these sales was initiated by a buyer looking for a move- up opportunity. Each sale provided the right combination of location, design features and price. For these sales, the Expanded New Home Program, succeeded. A marketing strategy meeting discussed how to maintain this successful beginning. Participants included representatives of the Visions 2004 Committee, Chamber of Commerce, Richfield Schools and Richfield Bank and Trust. Housing market experts, demographic and advertising specialists, local realtors, representatives from Marv Anderson Homes and staff also offered their insights. The meeting generated the following observations: - new highly visible marketing activities are needed; possible mediums include billboards, special display signs at sites, targeted direct mail contacts, and corporate contacts. - there is a need for greater house plan and price flexibility; more reliance should be placed on the buyer and builder to arrive at a desirable replacement home in a given neighborhood that will also generate sufficient tax increment. As a result of this information and observations, staff proposes the following: - to end the exclusive relationship with Marv Anderson and offer available sites to all qualified builders, including Marv Anderson. - an expanded marketing program; a determination of cost sharing and the method for implementation of a more highly visible and continuous program. - modifying program criteria relating to house design; providing criteria which remains sensitive to the Richfield character of housing and offers more expansion potential for first time and move-up buyers. - analysis of the impact of flexible design on tax increment cash flow projections. - modifying program procedures for buyer/builder participation. The type of builder, realtor, buyer solicitation and requirements for program participation will have to be broader than staff envisioned in April when remarketing of lots was first considered. - HRA review and consideration of the program revisions at the July, 1991 HRA meeting. Recommended Motion: 1. Receive a report from Marv Anderson Homes. 2. Authorize staff to: a) Notify Marv Anderson that the pending sale of seven lots by the HRA will be terminated in accordance with the agreements in 30 days. b) Prepare program modifications for consideration at the July, 1991 HRA meeting. Basis of Recommendation: 1) The venture with Marv Anderson has been a success. However, marketing and development needs exceed the scope of their resources. It is hoped that Marv Anderson will continue participating, although not on an exclusive basis. 2) It is likely that increased construction will result from a modified marketing and development approach. 3) Following the presentation of program revisions, in July, there should be sufficient time to identify interested and qualified builders and initiate additional construction activity in 1991. Alternative Recommendation: 1) Continue the exclusive working relationship with Marv Anderson. 2) Delay the 30 day notice to Marv Anderson until after the HRA has been presented with and considered the revised program in July. DiscussionfDecision Mode: Marlin Grant, President of Marv Anderson Homes, Inc., will report to the board at the meeting. Respectfully submitted, James ~ Prosser Executi a Director JDP:cak FIRST AMENDMENT TO CONTRACT FOR PRIVATE DEVELOPMENT BETWEEN DRAFT ~~-~~~ 7 ~~ s J0.~-~ 13 ~-o r, ~t-h ~ 3 a 3 JA-~^~-" (~~a5 ~5~ U 1 L {~~~~olr~ c~ ~r. iv3o m-lolr~d ~~~. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, MINNESOTA AND MARV ANDERSON HOMES, INC. This Instrument Drafted By: Holmes do Graven, Chartered 470 Pillsbury Center Minneapolis, MN 55402 FIRST AMENDMENT TO CONTRACT FOR. PRIVATE DEVELOPMENT This First Amendment, made and entered into this day of ,.1991, by and between 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, having its principal place of business at 6700 Portland Avenue, Richfield, Minnesota (HRA) and Marv Anderson Homes, Inc., a Minnesota corporation having its principal place of business at 8901 Lyndale Avenue, Bloomington, Minnesota (Developer). WITNESSETH: WHEREAS, the parties have entered into that certain Contract for Private Development (Contract) dated September 17, 1990, regarding the property located at ?145 James Avenue South (Property); and WHEREAS, the Contract called for completion of development of the Property by the March 31, 1991; and WHEREAS, the parties find it beneficial to modify the completion date. NOW, THEREFORE, in consideration of the mutual covenants and obligations of the HRA and the Developer, the parties agree as follows: 1. New Completion Date. Notwithstanding anything in the Contract to the contrary, the date by which the Developer agrees to complete construction on the Property is the July 1, 1991. 2. Terms of Previous Contract. Except for the completion date, all other terms shall remain as stated in the Contract. 3. Counterparts. This First Amendment may be executed simultaneously in any number of counterparts, all of which shall constitute one and the same instrument. IN WITNESS WHEREOF, the parties have caused this First Amendment to be executed in their names 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 MARV ANDERSON HOMES, INC. By Its President RC125-041(2) 2 STATE OF MINNESOTA ) ss COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this day of 1991, by Thomas E. Harms and James D. Prosser, respectively, the Chairperson and Executive Director of The Housing and Redevelopment Authority In and For the City of Richfield, Minnesota, a body politic and corporate, on behalf of the Authority. Notary Public STATE OF MINNESOTA ) ss COUNTY OF ) The- foregoing instrument was acknowledged before me this day of 1991, by Marlin D. Grant, President of Marv Anderson Homes, Inc., a Minnesota corporation, on behalf of the corporation. Notary Public 3 DRAFT c=tiati k+,«; FIRST AMENDMENT TO CONTRACT FOR PRIVATE DEVELOPMENT BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, MINNESOTA AND MARV ANDERSON HOMES, INC. This Instrument Drafted By: Holmes b~ Graven, Chartered 470 Pillsbury Center Minneapolis, MN 55402 FIRST AMENDMENT TO CONTRACT FOR PRIVATE DEVELOPMENT This First Amendment, made and entered into this day of , 1991, by and between 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, having its principal place of business at 6700 Portland .Avenue, Richfield, Minnesota (HRA) and Marv Anderson Homes, Inc., a Minnesota corporation having its principal place of business at 8901 Lyndale Avenue, Bloomington, Minnesota (Developer). WITNESSETH: WHEREAS, the parties have .entered into that certain Contract for Private Development (Contract) dated October 15, 1990, regarding - the property located at 6424 James Avenue South (Property); and WHEREAS, the Contract called for completion of development of the Property by the May 15, 1991; and WHEREAS, the parties find it beneficial to modify the completion date. NOW, THEREFORE, in consideration of the mutual covenants and obligations of the HRA and the Developer, the parties agree as follows: 1. New Completion Date. Notwithstanding anything in the Contract to the contrary, the date by which the Developer agrees to complete construction on the Property is the October 31, 1991. 2. Housing Design Criteria. The Developer agrees to utilize the housing design criteria attached hereto as Exhibit A in designing and completing the unit to be constructed on the Property. . 3. Terms of Previous Contract. Except for the completion date and use of the revised housing design criteria attached hereto, all other terms shall remain as stated in the. Contract. 4. Counterparts. This First Amendment may be executed simultaneously in any number of counterparts, all of which shall constitute one and the same instrument. IN WITNESS WHEREOF, the parties have caused this First Amendment to be executed in their names 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 MARV ANDERSON HOMES, INC. By Its President RC125-041(2) STATE OF MINNESOTA ) ss COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this day of 1991, by Thomas E. Harms and James D. Prosser, respectively, the Chairperson and Executive Director of The Housing and Redevelopment Authority In and For the City of Richfield, Minnesota, a body politic and corporate, on behalf of the Authority. Notary Public STATE OF MINNESOTA ) ss COUNTY OF ) The -foregoing instrument was acknowledged before me this day of ,~ 1991, by Marlin D. Grant, President of Marv Anderson Homes, Inc., a Minnesota corporation, on behalf of the corporation. Notary Public 3 RICHFIELD EXPANDED - NEW HOME -PROG~-~~1VI Housing Design and Site Development Criteria Within the Richfield Expanded New Home Program, the following are important design and development considerations:. - Siding material and style - Exterior facade presentation - Roof, window, siding and building line variability - Finished landscape - Interior space function and use The development of all sites shall meet the development objectives listed below. The guidelines were created to insure that the homes built on the identified lots blend in with the surrounding neighborhood and respond to specific concerns of the HRA. 1. General: • a. Each home shall be a single-family dwelling. b. The value of each new home must meet or exceed the value specified for each property in the development agreement. 2. Site Standards: a. The 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 with adjoining property. 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 new home and the neighboring properties. d. Existing trees shall be preserved when possible. Care should be taken to preserve existing root systems. A tree wrap,- with board reinforcement shall be used on trees directly adjacent to active grading and construction areas.. e. The construction site, neighboring property .and adjacent public streets shall be kept free of .construction debris at all times. 3. Building Standards:.. a. The home shall contain easily finishable space for 3-4 bedrooms, a minimum of one finished full bathroom and rough in for a half bath. b. A two-car garage, attached or detached, must be .provided on the site. c. Exterior materials (siding, soffit, doors and windows.), should be low maintenance. Aluminum and vinyl are preferred. Natural cedar lap is acceptable if properly stained or painted. Hardboard panels and hardboard lap siding are not acceptable. d. Unit height and mass of the new homes shall be compatible with the scale of the surrounding neighborhood. e. ~A full basement shall be provided in the house unless the selected design results in a split level, garden level type of basement. f. All building plans must be prepared in consultation with an Architectural Designer with a minimum two year technical degree or an Architect. g.. All construction must conform to the Sound Attenuation Building Standards for properties located in 65-69 and 70-74 Ldn zones. A copy of the Sound Attenuation Building Standards Specifications will be provided to developers building in those zones. NEW-HOME-PROGRAM II DRAFT (s go~~ l~~"~~ CONTRACT FOR PRIVATE DEVELOPMENT Between THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, MINNESOTA and MARV .ANDERSON HOMES, INC. This Instrument Drafted by: Holmes 3C Graven, Chartered 470 Pillsbury. Center Minneapolis, Minnesota 55402 Telephone: (612)337-9262 CONTRACT FOR PRIVATE DEVELOPMENT THIS AGREEMENT, made and entered into as of this day of , 1991, by and between 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, having its principal office at 6700 Portland Avenue, Richfield, Minnesota (HRA), and Marv Anderson Homes, Inc., a Minnesota corporation having its principal office at 8901 Lyndale Avenue, Bloomington, Minnesota(Developer). WITNESSETH: WHEREAS, the City of Richfield (City) and the HRA have created and established a Redevelopment Project (Project) and Tax Increment Financing District (TIF District) pursuant to the authority granted in Minnesota Statutes, Sections 469.001 through 469.047 and Sections 469.174 through 469.179; (collectively, the Acts); WHEREAS, pursuant to the Acts, the City and the HRA have adopted a redevelopment plan (Redevelopment Plan) and a tax increment financing plan (TIF 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 TIF Plan as hereinafter defined and particularly to make specified land in the Project available for development by private enterprise for and in accordance with the Redevelopment Plan, the HRA has determined to provide. substantial aid and assistance to finance publicdevelopment costs in the Project; ' WHEREAS, the Developer 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 and TIF Plan, will be in the vital best interests of the City .and the health, safety 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; and WHEREAS, the parties on the 19th day of November, 1990, entered into two Agreements regarding separate development of the lots comprising the Property and now wish, by means of this Agreement, to provide for development of the lots together and to rescind and cancel those previous Agreements. NOW, THEREFORE, in consideration of the mutual covenants and obligations of the HRA and the Developer, 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 meanings given below unless the context clearly requires otherwise: (a) City. The City of Richfield, Minnesota. - (b) Construction Plans. Collectively, the plans, drawings and related documents related to the Improvements. (c) Developer. Marv Anderson Homes, Inc., a Minnesota corporation. (d) Developer's Minimum Price. 5289,948, which represents the minimum value for which the Developer will construct the Improvements. (e) Development. The Property and the Improvements to be constructed thereon according to the Construction Plans approved by the HRA. (f) HRA. The Housing and Redevelopment Authority in and for the City of Richfield, Minnesota. (g) HRA Estimated Price. 5289,948. (h) Homeowner. A purchaser for value of the Property but not including any individual, corporation or entity related to the Developer. 2 (i) Housing and Redevelopment Authorities Act (BRA Aet). Minnesota Statutes- Sections- 469.001 through 469.047. (j) Improvements. Each and all of the structures and site improvements constructed on the Property by the Developer, as specified in the .Construction Plans approved by the BRA. (k) Mortgage and Holder. The term "mortgage" shall include the mortgages referenced in Article VI of this Agreement and any deed of trust or other instrument creating an encumbrance or lien upon the Property or any part thereof, as security for a loan. The term "holder" in reference to a mortgage includes any insurer or guarantor (other than the Developer) of any obligation or condition secured by such mortgage or deed of trust. (1) Property. The real property located within the District at 6809 Logan, the legal description of which is Lots 11 and 12, Block 5, "Tingle Brothers Lincoln Hills Second Addition," Hennepin County, Minnesota. (m) Redevelopment Project. (Project). The Redevelopment Project established by the HRA pursuant to Minnesota Statutes Sections 469.001 through 469.04.7 and described in the Redevelopment Plan. (n) Redevelopment Protect Plan (Redevelopment Plan). The plan for implementation of the Project adopted by the HRA .pursuant to Minnesota Statutes Sections 469.001 through 469.047. (o) Tax Increment. The tax increment produced by the increase in the valuation of the Property following certification of the original tax capacity by the county auditor and construction of the Improvements by the Developer. (p) 'Tax Increment Financing Act (TIF Act). Minnesota Statutes Sections 469.174 tfirough 469.179. (q) Tax. Increment Financing District (TIF District). The TIF District created by the HRA pursuant to Minnesota Statutes Sections 469.174 through 469.179 and described in the TIF Plan adopted therefor. (r) Tax Increment Financing Plan (TIF Plan). The plan for development of the .TIF District adopted by the HRA pursuant to Minnesota Statutes, Sections 469.174 through 469.179. (s) 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 Developer. Section 1.2 Exhibits. The following Exhibits are attached to and by ~eference made a part of this Agreement: A. Form of Certificate of Completion B. Housing Design Criteria C. License from Developer to HRA D. Form of Quit Claim Deed 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 Developer. The Developer makes the following representations and undertakings: (a) Subject to approval by Pulte Homes-PHM Corporation, the Developer 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 Developer has the necessary equity capital or will obtain commitments for financing necessary for construction of the Improvements; (c) The .Developer will construct the Improvements in accordance with the terms of this Agreement, the Redevelopment Plan, the TIF Plan and all local, state and federal laws and regulations; (d) The Developer will obtain, in a timely manner, all required permits= licenses and approvals, and will meet, in a timely manner, the requirements of sll 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 an architectural designer. 4 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 Developer and will cooperate with the efforts. of Developer to secure the granting of any permit, license, or other approval required to allow the construction of the Improvements; provided, however, that nothing con- tained in this subparagraph 2.2(b) shall be construed to limit in any way the reasonable and. legitimate exercise of the HRA's discretion in considering any submittal or application. ARTICLE III. ACQUISITION OF PROPERTY; CONVEYANCE TO DEVELOPER Section 3.1. Acquisition of Property and Demolition of Structures. The HRA has or_will acquire the Property. After acquisition, the HRA will demolish all structures and other improvements on the Property,. except such improvements ss the Developer and HRA agree are to be retained and used in connection with the Development. With the exception of the structures, and improvements to be retained, the HRA will clear the Property and leave the site ready for construction. In order to allow the HRA and its contractors access to the Property for the purpose of demolition, the Developer will grant the HRA a license in the form of Exhibit C. Section 3.2. Conveyance to Developer. After it has acquired the Property, the. HRA agrees to sell the Property to the Developer and the Developer agrees to purchase the Property from the HRA. The HRA will convey the Property to the Developer by Quit Claim deed in the general form of Exhibit D. The purchase price for the Property will be 562,760. Section 3.3. Closin . Closing on the Property will take place on such date as may be agreed to by the parties in writing. 5 Section 3.4. Taxes and Special Assessments. Levied and pending special assessments, if any, will be satisfied at the time of closing and the Property will be transferred to the Developer free and clear thereof. Real estate taxes payable in 1991 will be prorated to the day of closing. Section 3.5. Soil Conditions and Hazardous Wastes. Prior to sale of the Property to the Developer, the HRA will provide the Developer with a copy of a Phase I environmental audit report. The Developer may obtain a soils report at the Developer's expense prior to closing. If the Developer wishes to obtain a soils report, .the HRA will grant access to the Property for such purpose by means of a license agreeable to the parties. If the Phase I environmental audit report or soils report is unsatisfactory to the Developer, the Developer may notify the HRA prior to closing of such fact and terminate this Agreement. If the Developer terminates this Agreement pursuant to this Section 3.5, the parties shall have no further obligation towards one another for conveyance of the Property or construction of the Improvements. If the Developer proceeds to closing on the Property and the price paid by the Homeowner for the Development is at least equal to the HRA Estimated Price, the Developer will refund to the HRA its actual and reasonable costs in obtaining the Phase I environmental audit. If the price paid by the Homeowner for the Development is less than the HRA Estimated Price but more than the Developer's Minimum Price, the Developer will reimburse the HRA for the prorata portion of its actual and reasonable costs in obtaining the reports. The share of the costs to be reimbursed by the Developer will vary from 0 if the Development sells for the Developer's Minimum Price to 100 percent if the Development sells for the HRA's Estimated Price. The exact percent of reimbursement will be determined by the 6 following formula: (Amount in excess pf Developer's Minimum Price divided by ~, the difference between Developer's Minimum Price and HRA Estimated Price) X 100. ARTICLE IV. CONSTRUCTION OF IMPROVEMENTS Section 4.1. Construction of Improvements. The Developer shall construct the Improvements on the Property in .accordance with the Construction Plans and shall maintain, preserve and keep the Improvements in good repair and condition until sale of the Property to the home buyer. Not later than the date of sale of the Property to the Developer and for at least 30 days thereafter, the Developer will make a good faith effort to pre-sell the Development to a Homeowner at the HRA Estimated Price. During. such 30-day period, the HRA will schedule and co-host with the Developer a reception or similar event designed to publicize the Property and other sites to potential Homeowners. Following expiration of the 30 days, the Developer .may proceed with construction of a house on the Property which is at least equal in value to the Developer's Minimum Price. The Developer will notify the HRA of the price at which the Development was sold to the Homeowner. Section 4.2. Building Plans. No building permit shall be issued by the City unless the plans therefore are in conformity with the Developer's Minimum Price, the Redevelopment .Plan, the TIF Plan, this Agreement, including the design standards outlined in Exhibit B, and all local, state and federal regulations. The HRA shall, within 25 days of receipt of building plans submitted in application for a building permit, review such plans to determine whether the foregoing require- ments have been met. If the HRA determines such plans to be deficient, it shall notify the Developer in writing stating the deficiencies and the steps necessary for correction.. Issuance of the building permit by the City shall be a conclusive 7 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 October 1, 1991. All construction shall be in conformity with the approved Construction Plans. Periodically during construction the Developer 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 Developer will. be unable ~o complete construction of the Improvements in the time permitted by this Section 4.3, it may notify the Developer and demand assurances from the Developer regarding the Developer'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 this Agreement to be breached by the Developer 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 Developer 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 for the completion thereof. In the event that the HRA is satisfied with the construction, the HRA shall furnish the Developer with a Certificate of Completion in the form attached hereto as Exhibit A. Such certifi- cation 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 Developer to construct the Improvements. 8 The certification provided for in this Section 4.4 shall be in recordable form. 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 Developer. with a written statement, indicating in adequate detail in what respects the Developer has failed to complete the Improvements in accordance with the provisions of this Agreement, or is otherwise in default, and what measures or acts will be necessary, in the opinion of the HRA, for the Developer to take or perform in order to obtain such certification. Prior to the issuance of a Certificate of Completion, no occupancy of the Improvements shall be permitted. 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, the Developer shall be liable to the HRA for the amount of the HRA's expenses as liquidated damages. As security for the .obligations created in this Section 4.5, the _ Developer shall deliver to the HRA prior to the issuance of a building permit for the Improvements, an irrevocable letter of credit or other security satisfactory to the HRA in the amount of =13,188. The security shall be retained by the HRA until completion of construction of the- Improvements has been certified by the HRA. Upon such happening the security will be returned to the Developer and all liability under this Section 4.5 shall terminate. If at any time prior to the issuance of the Certificate of Completion, the HRA determines that, for whatever reason the amount of security is inadequate, the HRA shall notify the Developer of such determination, and the Developer shall have 30 days from the date of notification to furnish new security in the original amount less any drafts previously made against it. The provisions of this Section 4.5 shall not be construed to prejudice or limit any additional rights of the HRA under Article VIII of this Agreement. 9 ARTICLE V. INSURANCE Section 5.1 Insurance. The Developer :will provide and maintain or cause to be provided and maintained at all times during the process of constructing the Improvements and, from time to time at the request of the HRA, furnish the HRA with proof of payment of premiums on: (a) Builder's risk insurance, written on the so-called "Builder's Risk -- Completed Value Basis," in an amount .equal to 100% of the insurable value of the Improvements at the date of completion, and with coverage available in nonreporting form on the so-called "all risk" form of policy; (b) Comprehensive general liability insurance .(including operations, contingent liability, operations of subcontractors,. completed operations and contractual liability insurance) together with an Owner's Contractor's Policy with limits against bodily injury and property damage of not less than 31,000,000 for each occurrence (to accomplish the above-required limits, an umbrella excess liability policy may be used); and (c) Workers' compensation insurance, with statutory coverage. The policies of insurance required pursuant to clauses (a) and (b) above shall be in form and content satisfactory to the HRA and shall be placed with financially sound and reputable insurers licensed to transact business in Minnesota. The policy of insurance delivered pursuant to clause (a) above shall contain an agreement of the insurer to give not less than thirty (30) days advance notice to the HRA in the event of cancellation oP such policy or change affecting the coverage thereunder. Section 5.2. Modification: In order to facilitate obtaining financing for the construction of the Improvements, the HRA agrees to modify this Article V to accommodate the interests of the Developer or the Holder of the First Mortgage; provided, however, that the HRA determines, in its reasonable judgment, that any such modification will adequately protect the legitimate interests and security of the HRA with respect to the Improvements. 10 ARTICLE VI. FINANCING Section 6.1 Financing. Within 15 days of the date of execution of this Agreement, the Developer 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 Developer of its approval. If the HRA rejects the evidence of financing as inadequate, the Developer shall have 30 days or such additional period of time as the Developer may reasonably require from the date of such notification to submit evidence of financing satisfactory to-the HRA. If the Developer fails to submit such evidence or fails to lase 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. Se.etion 6.2 Limitation Upon Encumbrance of Property. Prior to the issuance of the Certificate of Completion, neither the Developer nor any successor in int-crest to the Property or any part thereof shall engage in any financing or any other transaction creating any Mortgage or other encumbrance or lien upon the Property, whether by express agreement or operation of law, or suffer any encum- brance or lien to be made on or attached to the Property other than the liens or encumbrances attached for the purposes of obtaining funds to the extent necessary for making the Improvements without the prior written approval of the HRA. The HRA shall not approve any Mortgage which does not contain terms which conform to the terms of this Article VI and Section 8.2 of this Agreement. 11 Section. 6.3 Copy of Notice of Default to Lender. Whenever the HRA shall deliver any .notice or demand to the Developer with respect to any breach or default by the Developer 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 authorized by the Agreement at the last address of such Holder shown in the records of the HRA. Section 6.4 Lender's Option to Cure Defaults. After any breach or default referred to in Section 8.1 of this Agreement, each such Holder, insofar as the rights of the HRA are concerned, shall have the right, at its option, to cure or remedy such breach or default, or such breach or default to the extent that it relates to the part of the Property covered by its Mortgage, and to add the cost thereof to the Mortgage debt and the lien of its Mortgage; provided that if the breach or default is with respect to construction of the Improvements, nothing contained in this Section 6.4 or any other section of this Agreement shall be deemed to permit or authorize such Holder, either before or after foreclosure or .action in lieu thereof, to undertake or continue the construction of the Improvements or completion of the Development beyond the extent necessary to conserve or protect Improvements or construction already made without first having expressly assumed the obligation to the HRA, by written agreement, to complete, in the manner provided in this Agreement, the Development or the part thereof to which the lien or title of such Holder relates. Any such Holder who shall promptly complete the Development or appli- cable part thereof shall be entitled, upon written request made to the HRA, to certification by the HRA to such effect in the manner provided in Section 4.4 of this Agreement, ,and any such certification shall, if so requested by such Holder, mean and provide that any remedies or rights that the HRA shall have or be 12 entitled to because of failure of the Developer or any successor in interest to the Property, or any part thereof, to cure. or remedy any default with respect to the construction of the Improvements on other parts or parcels of the Property, or because of any other default in or breach of the- Agreement by the Developer or such successor, shall not apply to the Property to which such certification relates. Section 6.5 HRA's Option to Cure Default. In the event the Holder of financing authorized pursuant to this Article VI sends a notice of default to the Developer, the Holder shall also use its best efforts to notify the HRA in writing of; (a) the fact of the default, (b) the elements of the default, and (c) the actions required to cure the default. If the Developer fails to cure the default in a timely manner or .fails to make arrangements satisfactory to the Holder to cure said default, the HRA shall have 30 days from the expiration of such cure period to cure the .default.- If the HRA cures the default as set forth above, the Holder shall pursue none of its remedies under the financing based upon the said default of the Developer. In the event of a transfer of the title to the Property to a third party approved by the HRA -and Holder, which approval cannot be unreasonably withheld, regardless of whether required to cure a default, said transfer shall not constitute an Event of Default under the financing unless the security of the Holder has, in fact, been impaired by said transfer. In the event of such approved transfer which does not impair the security of the Holder, the Holder shall permit the transferee to assume. all outstanding obligations and receive all remaining disbursements under the financing. Section 6.6 Subordination. In order to facilitate obtaining financing for the construction of the Improvements by the Developer, the HRA shall agree to modify this. Agreement in the manner and to the extent it deems reasonable, upon request by the financial institution and the Developer. 13 ARTICLE VII. PROHIBITIONS AGAINST ASSIGNMENT AND TRANSFER Section 7.1 Representation as to Redevelopment. The Developer represents and agrees that its undertakings pursuant to the Agreement, are for the purpose of development of the Property and not for speculation in landholding. The Developer further recognizes that, in view of: (s) the importance of the development of the Property to the general welfare of Richfield; and (b) the substantial financing and other public aids that have been made available by the HRA .for the purpose of making the Development possible the qualifications and identity of the Developer are of particular concern to the HRA. The Developer 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 Developer for the faithful performance of all undertakings and covenants agreed by the Developer to be performed. Section 7.2. Prohibition Against Transfer of Property and Assignment of Agreement. For the reasons set out in Section 7.1 of this Agreement, the Develop- er represents and agrees that, except for associating with other individuals or entities, prior to the completion of Improvements as certified by the HRA: (a) Except only by way of security for, and only for the purpose of obtaining financing necessary to enable the Developer or any successor in interest to the Property, or any part thereof, to perform its obligations with respect to the Development under this Agreement, and any other purpose authorized by this Agreement, the Developer, except as so authorized, has not made or created, and that it will not make or create, or suffer to be made or created, any total or partial sale, assignment, conveyance, or any trust or power, or transfer in any other mode or form of or with respect to this Agreement or the Property or any part thereof or any interest therein, or any contract or agreement to do any of the same, without the prior written approval of the HRA; and (b) The HRA shall be entitled to require, except ss otherwise provided in this Agreement, as conditions to any such approval under this Section 7.2 14 that: (i) Any proposed transferee shall have the qualifications and financial responsibility, as determined by the HRA, necessary and adequate to fulfill the obligations undertaken in this Agreement by the Developer or, in the event the transfer is of or relates to part of the Property, such obligations to the extent that they relate to such part. (ii) Any proposed transferee, by instrument in writing satisfactory to the. HRA and in form recordable among the land records, shall- for itself and its .successors and assigns, and specifically for the benefit of the HRA, have expressly assumed all of the obligations of the Developer under this Agreement and agreed to be subject to such obligations, restrictions. and conditions or, in the event the transfer is, of, or relates to part of the Property, such obligations, conditions, and restrictions to the extent that they .relate to such part; provided, that the fact that any transferee of, or any other successor in interest whatsoever to, the Property or any part thereof, shall, for ~ whatever reason, not have assumed such obligations or agreed to do so, shall. not, unless and only to the extent otherwise specifically provided. in the Agreement or agreed to in writing by the HRA, relieve or except such transferee or successor from such. obligations, conditions, or restrictions, or deprive or limit the HRA of or with .respect to any rights or remedies or controls with respect to the Property or the construction of the Improvements; it being the intent of this Section ?.2, together with other provisions of this Agreement, that to the fullest extent permitted by law and equity and excepting only in the manner and to the extent specifically provided otherwise in the Agreement no transfer of, or change with respect to, ownership in the Property or any part thereof, or any interest therein, however consummated or occurring, whether voluntary or involuntary, shall operate, legally or practically, to deprive or limit the HRA, of any rights or remedies or controls provided in or resulting from this Agreement with respect to the Property and the con- struction of the Improvements that the HRA would have had, had there been no such transfer or change. (iii) There shall be submitted to the HRA for review all instruments and other legal documents involved in effecting transfers described herein, and if approved by the HRA, its approval shall be indicated to the Developer in writing. In the- absence of specific written agreement by the HRA to the contrary, no such transfer or approval by the ;:HRA thereof shall be deemed to relieve the Developer from any of its obligations with respect thereto. The sale of the Development. to the Homeowner shall not be deemed to be a transfer within the meaning of this Section 7.2. Section ?.3 Approvals. Any approval required to be given by the HRA under this Article VII may be denied only in the event that the HRA reasonably determines that the ability of the Developer to perform its obligations under this Agreement will be materially impaired by the action for which approval is sought. 15 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 Developer to pay when due the payments required to be paid or secured under any provision of this Agreement; (b) Failure by the Developer to observe and substantially perform any covenant, condition, obligation or agreement on its part to be observed or performed hereunder, after written notice to the Developer as provided in this Agreement; (c) If the Developer 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 Developer,. on a petition in bankruptcy filed against it, be adjudicated a bankrupt, or a court of competent jurisdiction shall enter an order of decree appointing, without the consent of the Developer, a receiver of the Developer or of the whole or substantially all of its property, or approve a petition filed against the Developer seeking reorganization or arrangement of the Developer 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 Developer is in default under any Mortgage and has not entered into awork-out agreement with the Mortgagee. 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 but only after the Developer's failure to cure within 30 days of written notice of default, take any one or more of the following actions: (a) suspend its performance under this Agreement until it receives assurances from the Developer, deemed reasonably adequate by the HRA, that the Developer will cure its default and continue its performance under this Agreement; (b) cancel or rescind this Agreement; 16 (c) withhold the Certificate of Completion; or (d) take whatever action at law or in equity may appear necessary or desirable to the HRA to collect any payments due under this Agreement, or to enforce performance and observance of any obligation, agreement, or covenant of the Developer 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 authorized by this Agreement and (b) any rights or interests 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 Developer's interest in the Property, it shall, notwithstanding the foregoing, be obligated to perform the following obligations of the Developer only to the extent that the same have not theretofore been performed by the Developer: Sections 3.2 and 3.5, Sections 4.1 through 4:5; Sections 5.1 and 5.2. Said Mortgagee, upon foreclosure or taking of a deed in lieu, shall have no obligations pursuant to this Agreement other than as specifically set forth in the foregoing sentence. 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 Developer 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. 17 Section 8.4 No Additional Waiver Implied by One Waiver. In the event any covenant or agreement contained in this Agreement should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. 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 therefrom. No member, official, or employee of the HRA shall be personally liable to the Developer, or any successor in-interest, in the event of any default or breach by the HRA or for any amount which may become due to the Developer 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 Developer, as though fully set forth herein. Section 9.3 Notice of Status and Conformance. At such time as all of the provisions of this Agreement have been fully performed by the Developer, the HRA, upon not less .than ten days prior written notice by the Developer, agrees to execute, acknowledge and deliver, without charge to the Developer or to any person designated by the Developer, a statement in writing in recordable form certifying the extent to which this Agreement has been performed and the obliga- tions hereunder satisfied. 18 Section 9.4 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 other shall be sufficiently given or delivered if it is sent by mail, postage prepaid, return receipt requested or delivered personally: (a) As to the City: Richfield HRA Executive Director 6700 Portland Avenue Richfield, Minnesota 55423 (b) As to the. Developer: Marv Anderson Homes, Inc. .8901 Lyndale Avenue South Bloomington, MN 55420 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 Sect ion 9.4. Section 9.5 Counterparts. This Agreement may be simultaneously executed in any number of counterparts, all of which shall constitute one and the same instrument.. IN WITNESS WHEREOF, the HRA has caused this Agreement to be duly exe- euted in its name and behalf and its seal to be hereunto duly affixed and the Developer has caused this Agreement to be duly executed as of the day and year first above written. 19 THE' HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, MINNESOTA By Its Chairperson By Its Executive Director MARV ANDERSON HOMES, INC. By Its President RC125-041 20 STATE OF MINNESOTA ) ss COUNTY OF ) The foregoing instrument was acknowledged before me this day of 1991, by Thomas E. Harms and James D. Prosser, the Chairperson and Executive Director, respectively, of the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota, a body corporate and politic, on behalf of the HRA. Notary Public STATE OF MINNESOTA ) ss COUNTY OF ) The foregoing instrument was acknowledged before me this day of 1991, by Marlin D. Grant, the President of Marv Anderson Homes, Inc., a Minnesota corporation, on behalf of the corporation. Notary Public 21 EXHIBIT A FORM OF CERTIFICATE OF COMPLETION The undersigned hereby certifies that Marv Anderson Homes, Inc., has fully and completely complied with its obligations under Article IV of that document entitled "Contract for Private Development," dated between the Housing and. Redevelopment Authority in and for the City of Richfield, Minnesota with respect to construction of the Improvements in accordance with the approved construction plans and is released and forever discharged from its obligations to construct under such above-referenced Article. DATED: By Its Chairperson By Its Executive Director RICHFIELD .EXPANDED NEW HOME PROGRAM Housing, Des~,n and Site Development Criteria Within the Richfield Expanded New Home Program, the following are important design and development considerations: - Siding material and style - Exterior facade presentation - Roof, window, siding and building line variability - Finished landscape - Interior space function and use The development of all sites shall meet the development objectives listed below. The guidelines were created to insure that the homes built on the identified lots blend in with the surrounding neighborhood and respond to specific concerns of the HRA . 1. General: a. Each home shall be a single-family dwelling. b. The value of each new home must meet or exceed the value specified for each property in the development agreement. 2. Site Standards: a. Utility meters shall be screened from street view; locations must be specified on plans. b. Site drainage shall be accommodated on the site so that water is directed away from the new home end the neighboring properties. c. Existing trees shall be preserved when possible. Care should be taken to preserve existing root systems. A tree wrap, with board reinforcement shall be used on trees directly adjacent to active grading and ' construction areas. d. The construction site, neighboring property and adjacent public streets shall be kept free of construction debris at all times.' 3. .Building Standards: a. The home shall be a three-four bedrroms, two bathrooms structure. b. A two car garage, attached or detached, must be provided on the site. c. Exterior materials (siding, soffit, doors and windows), should below maintenance. Aluminum and vinyl are preferred. Natural cedar. lap is acceptable if properly stained or painted. Hardboard panels and hardboard lap siding are not acceptable. d. Unit height and mass of the-new homes shall be compatible with the scale of the surrounding neighborhood. e. A full basement shall be provided in the house unless the selected design results in a split level, garden. level. type of basement. f. -All building plans must be prepared in consultation with an Architectural Designer with a minimum two year technical degree or an Architect. g. All construction must conform to the Sound Attenuation Building Standards for properties located in 65-69 and 70-74 Ldn zones. A copy of the Sound Attenuation Building Standards Specifications will be provided to developers building in those zones. NEW-HOME-PROGRAM II EX]Fi1BIT C LICENSE AGREEMENT. This, License Agreement made and entered into this day of 1990, by and between Marv Anderson Homes, Inc., a Minnesota corporation having its .principal office at 8901 Lyndale Avenue South, Bloomington, Minnesota (Licensor), and the Housing and. Redevelopment Authority in and for the City of Richfield, Minnesota, a Minnesota body corporate and politic having its principal office at 6700 Portland Avenue, Richfield, Minnesota (Licensee): W ITNESSETH: WHEREAS, Licensor is the fee owner of certain property located in the City of Richfield, Hennepin County, Minnesota and le¢slly dest~r;hpA ~~ (Property);- and WHEREAS, the Property is within a Redevelopment Project (Project) and a Tax Increment Financing District (TIF District), duly established by Licensee pursuant to Minnesota. Statutes, Sections 469.001 through 469.047 and Sections 469.174 through 469.179, respectively; and WHEREAS, the Licensee and Licensor have entered into a Contract for Private Development (Contract) dated which calls for the Licensee to demolish the structure presently on the Property and to perform a Phase I environmental audit and a soils report on the Property; and WHEREAS, Licensor has agreed to make the Property available to the Licensee for the purpose of allowing Licensee to perform said work. NOW, THEREFORE, in consideration of the mutual covenants and obligations contained herein and in the Contract, the parties do hereby agree as follows: C-1 1. Licensor hereby grants to Licensee a license. over, on and across the Property for the purpose of allowing Licensee to perform the demolition work and,to obtain a Phase I environmental audit and a soils condition report and to take any and all actions necessarily related thereto. This license provides anon-exclusive right to enter the Property by Licensee and is not revocable by the Licensor without Licensee's written consent. 2. Licensee shall pay no rent to the Licensor under the license hereby granted 3. •• The term of this license shall commence on the day first written above and shall terminate upon completion by the Licensee of the work, but in no event later than , or such other date as may be mutually agreed to in writing by the parties. 4. .Licensee agrees to carry public liability insurance in an amount sufficient to protect Licensor and Licensee from any and all claims arising out of the actions of Licensee, its. agents or contractors in competing the. work on the Property. 5. Licensor shall. at all times remain responsible for the payment of all taxes and special assessments levied against the Property. IN WITNESS WHEREOF, Lessor and Lessee have caused this License Agreement to be entered into as of the day and year first written above. THE HOUSING Ah'J REDEVELOPMENT AUTHORITY IN AIv D FOR THE CITY OF RICHFIELD, MINNESOTA By Its Chairperson sy Its Executive Director MARV ANDERSON HOMES, INC. ey Its President RC125-041 C-2 STATE OF MINNESOTA ) ss COUNTY OF ) The foregoing instrument was acknowledged before me this day of 1990, by Thomas E. Harms and James D. Prosser, the Chairperson and~~ Executive Director, respectively, of the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota, a body corporate and politic, on behalf of the HRA. Notary Public STATE OF MINNESOTA ) ss . COUNTY OF ) - The foregoing instrument was acknowledged before me this day of 1990, by Marlin D. Grant, the President of Marv Anderson Homes, Inc., a Minnesota corporation, on behalf of the corporation. Notary Public C-3 M together with a0 heredi o~ "'O'e 1Oe0' a ~[.ewy. Oenbew en tea, taaunt[ and aPPunenancee belortsin~ hereto. '~':: U•rc/ Cap ~t.~m~ Hrtr ey sy STATE OF b(DYNESpTA ~ t4 _~.~~ .,~. ~. COUNTY OF ~ •• r The foee~oiio~ wa, acltnowl 111 hY- ?*d~- v.~_ mad brfore me tliii dq of the c ., - ands ~ n---- - .19.. of and under the 4 c -~!l1RS~+~~ ~ nne o a , a publ is body ,-....~ rorwatwcit,uir ~- ---~--~ oA half of ~ HRA --mot--- e~°Dlitis oa ecwt roa orxsa tnru oa awxs~ j I ~sw• s st -eas~ .. ~ county, Minnesota, de~bed as foUow~; • tea! properly to (insert legal description of Property prior to execution) _ .. __ _-__ _ . _ ______.__J rxu amvrtxr swat Dwrsa a ~woossair M [~[~ y ~~ ss~ ~ ~1 ~ ~ ~e>t rwY - • -Mw D[ W Y . r CM~r~ir ~~w~ _ ~~~Y YY1~s cee.~f~w a1W. a [rte, E: w ~ - .