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05-31-77 agendar-- CITY OF RICHFIELD, MINNESOTA Office of City Manager Council Letter No. 171 Agenda May 31 , 1977 The Honorable Mayor and- Members of the City Council City of Richfield Gentlemen: Subject: Continuation of Liquor License Application far the Godfather Restaurant 700 West 66th Street At the city council meeting on May 23rd additional testimony was given by the applicants for the Godfather, Inc. liquor license. As a result of that hearing, there were several questions upon which the council requested specific information. In order to provide the applicants with an opportunity to respond to these issues , the hearing was continued to the special council meeting scheduled for May 31st. Attached is the information that has been provided by the applicants as a result of these meetings. The first item is a letter dated May 26th and signed by both Mr. Anzevino and Mr. Burnett. This letter deals with the following: 1, The disposition of the unpaid city utility bills charged against .the property . 2 . The removal of a roof top bill board . 3. The commitment to appoint a resident manager. 4.. The remodeling time table. 5. Proposed entertainment. 6 . A prof ected volumne of food sales in relation to liquor sales . 7. General statement with regard to the capitalization commitment and business backgrounds of the applicants . Additionally, the applicants have provided the attached financial statements which they have signed. These statements identify the source of capitalization and the proposed disbursement. As a part of the original investigation, the. Public Safety Department did confirm the mortgage and loan commitments with the financiers as a part. of the financial statements . The applicants have also provided their • Council Letter No. 171 - 2 - May 31, 1977 estimated projections of potential income and operating expenses. It should .. be noted that these projections are estimates only and are provided by the applicants only to attempt to address the specific question that was raised at the last council meeting. The applicants have also received an extension on the option to purchase this property to June 1 , 1977. I have enclosed a copy of that amendment to the purchase agreement. In addition to this amendment to the purchase agreement, I am also enclosing an amendment signed by the sellers in which they agree to satisfy the outstanding city utility claims against the property. The Minnesota Department of Revenue has agreed to furnish a lien satis- faction upon receipt of a signed promissory note executed between Nick Minotte and the present property owners, Jerome Dayton and Herschel Swain: -This note has been signed and a copy of both the note and the agreement from the State Department of Revenue is attached . While the note is only for a portion of the tax claim, the lien satisfaction effectively removes the state claim against the property. This would resolve the delinquent tax claim under our city ordinance provision regarding such a matter. The applicants have indicated they will,be prepared to present a fully executed copy of a lien satisfaction document at the May 31st meeting. The only other remaining issue on which the city council requested additional information is the matter of property ownership. We have been advised by a Mr. Richard Williams, an attorney of the law firm that filed the notice of lis pendens on this property, that he will be present at the council meeting Tuesday night. At that time he will be able to advise the city council as to what action he proposes to take on behalf of his client concerning this law suit. Respectfully su fitted, U~ /"" _ OJ• Wayne S . Burggraa City Manager WSB/jkl cc: Public Safety Director City Attorney May 26, 1977 City Council of Richfield 6700 Portland Avenue Richfield, Minnesota 55423 Gentlemen: Re: Questions Arising from Council Meeting of May 23, 1977 In answer to the above-identified questions, we state: (1) Unpaid utility bills of the City of Richfield of approximately $1,300 will be paid by Mssrs. Dayton and Swain; and they have agreed to pay the utility bills prior to the issuance of the license. (2) Th.e issuance of the license may be withheld until the Naglie outdoor advertising billboard has been removed from atop the roof of the property at 708 66th Street, Richfield. (3) Mssrs. Anzevino and Burnett also agree to furnish Mr. Tom Morgan, public safety director, with information regarding the resident manager for the Godfather's establishment prior to the issuance of the liquor license. (4) Note that the Godfather corporation, in comparison to the last three licensees, could be, if possible, considered over-capitalized. (5) That the construction of the premises will take approximately six to eight weeks after the granting of the license to be ready for opening. , C6) Also note that there will be no live rock entertainment. zf any entertainment is provided, it will be soft dinner music. (7) The volume. of the business will be based on 70 to 80 percent food volume to 20 to 30 percent liquor volume, making the Godfather's. operation a predominantly food-orientated business. .R City Council of Richfield Play 26, 1977 ~ Page 2 (8) Mssrs. Anzevino and Burnett bring to this business venture some 60-odd-years of business experience; Mr. Anzevino having 27 years of restaurant or liquor-food experience, and Mr. Burnett having the remainder in business experience. hn Anzev o Gerald M. Burnett GODFATIIER, INC FINANCIAL STATErLENT April 2S, 1977 ~;T^:...~1'y,~^a1".TO~!r[.aoYV.: wnv~c~a..a.~.~.~.~.~--____-_ GODFATHER, INC. BALANCE SHEET April 25, 1977 (Unaudited) ASSETS CURRENT ASSETS: Cash Prepaid expenses TOTAL ASSETS LIABILITIES AND SHAREHOLDFRS~ EQUITY LIABILI~'IES Note payable -officers SHAREHOLDEP.Sf EQUITY: . Common stock - $1 par value Authorized 25,000 shares Issued 1,000 shares Capital in excess of par value TOTAL LIABILIT IES AND SHAREHOLDERS- EQUITY $15,398 _ 4 602 $20,000 $10,000 1, 000 _ 9,000 10,000 $20,000 GODFATHER, INC. NJTES TO FINANCIAL STATEMENT A ril 25, 1977 Unaudited Note 1 - CASH INVESTMENT: It is the intention of an additional $120.,000 payment of land, build ing capital. ,,. ~. `~ the officers of the corporation to invest -'the proceeds to be used for the down ing and equipment, improvements and~work- Note 2 - LAND AND BUILDING: Total cost of land and building in the amount of $635,000 is to be financed as follows: Initial down payment f~ Mortgage - Richfield Bank and Trust Note payable -.Rush Open-end note - Dayton and Swain Contract for deed - Dayton and Swain $ 75,000 320 , 000 - ~__ 110,000 60,000 70 , 000 635,000 GODFATHER, INC. NOTES TO FINANCIAL STATEMENT April 25, 1977 (Unaudited) Note 1 - CA5H INVESTMENT: It is the intention of the officers of the corporation to invest an additional $120,000*- the proceeds to be used for the down payment of land ,-building and equipment, improvements and working capital. Initial down payment: $75,D00 Note 2 - BUILDING IMPROVEMENTS: General Contractor $21,830 Plumbing h 000 27,830* ° Note 3 - FURNITURE & FIXTURES Initial down payment $ 6,000* Contract with Harrison House SuperValue 54,000 60,000 Note 4 - CASH. FLOW (balance remaining) $11,170* Note 5 - ADDITIONAL WORKING CAPITAL Offices are capable of adding additional working capital if necessary through bank financing, cash.. reserves or property financing. * Disbursement of $120,000 investment by corporate officers. Break-down of $120,000: $70-,000 in cash reserves, second mortgage on Mr. Anzevino:s home, $50,000 from cash reserves of Mr. Burnett - totalling $120,000. hn nze no rGerald Burnett . .. .+ ' . } ~ • t ESTIN{ATED REVENUE STATEMENT PROJECTION GODFATHER, INC. Dinner Ticket - $10.00 per person Lunch Ticket - $ 5.00 per person Cost of Sales This Figure Based on 60o Occupancy One Lunch - One Dinner 800,000 240,000 56b;000 This Figure Based on 80o Occupancy One Lunch - One Dinner 1,100,000 330,000 ?70,000 Gross Profit Salaries Advertising Credit cards Insurance Bed debts Linen Licenses Audit legal Maintenance Repair & maintenance Taxes - payroll Uniforms Office supply Rent Service All utilities Miscellaneous Taxes - deal estate Total Operating Expense NET PROFIT Operating Expense $233,000 25,000 8,000 12,000 2,000 10,000 8,000 4,000 12,000 5,000 22,000 3,000 3,000 72,000 25,000 16,000 10,000 24,000 $467,000 $ 91,000 Operating. Expense $277,000 25,000 11,000 12,000 2,000 14,000- 8,000 5,000 12,000 7,000 27,000 4,000 3,000 72,000 25,000 16,000 20,000 24,000 $554,000 $216,000 These figures do not include any income from speak-easy operation, but labor cost is included; also no provision alloted for banquet income. ,. Cost of sales based on 70o food - 3.0~ liquor. May 24, 1977 The Godfather, Inc. The time within which to perform under the Purchase Agreement dared March 14. 1977. is hereby extended to June 1, 1977. THE GODFATHER, INC. HN APdZ INO , President ~ . ; I, ;, ~/ ~ ' d ,__ ~HERSCHEL S. SWAI ~ ~~ May 26, 1977 City Council City of Richfield Richfield, Minnesota Re: Real estate located at 708 jti~est 6bth Street commonly known as Heidleberg Dining Lounge or Nick Minotte's Gentlemen: Please be advised that all sewer and water charges due and owing ~. to the City of Richfield against the above-referenced premises will be paid by the undersigned prior to the issuance of a liquor license to The Godfather, Inc. JEROME C. DAYTON and HERSCHEL S . SkTAIN , 7 .~.--~!% DEfitI~T1S t~. STRID, Their~Attorney In Fact POtirIER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS that I, HERSCHEL S. SWAIN, of Burnsville, Minnesota, hereby constitute and appoint DENNIS W. STRID, of Bloomington, Minnesota, my true and lawful attorney in fact and in my name to settle all matters pertaining to that certain parcel of real estate popularly known as: 708 West 6bth Street, Richfield, Minnesota, and legally described as follows, to-wit: , SEE APPENDIX "A" ATTACHED HERETn AND r1ADE A PART HEREOF; and to execute any and all documents and perform such other acts as may be necessary to accomplish the powers granted herein. IN WITNESS «iEREOF, I have hereunto set my hand and seal this ~ day of February, 1977. ~l~ ERSCHEL S. SWAIN Subscribed and sworn before me this ~ day of February, 1977. N TARY PU IC - ~'~7~, RAQUEL WELLS ?.;: , NOTARY PUBLIC - MINNESOTA a"r ' ~ HENNEPIN COUNTY ~~'~~ My Commission Expires June 1, 1983 '~'1-V APPENDIX "A" TO POWER OF ATTORNEY OF HERSCHEL S. SWAIN s` • ~ , o~ . ,~ . r - ..c i+` + Vi; ~ ~;+~~ ` ~i ` .` . ®1 ° All ih~t cart of Cover^-~e^.t Lot One, ; - • Tt:chty-seven (27), "Tr:reship '^renty-ezSht (28), _ ' -four "dcccrzbed as fol7o:at: ~ d; ' T.ai,~c 'Iwi•nt}' (- ) ~ and l•.'rst one- Co:a-~cncinr t z point on :.'rc mast Town- . • quarter lire of Section T`.:r_nty-seven (?.7), ship Twenty-cii;ht (2S), an•~c 'rh;enty-four (24), • Y.cst, ~:hich point is Oac licadred _ifty-tcao and . B/lp (152. S) feet £ast of said '.•:est one-ouartcr h corner of Section T::er*_,-seven (27); t. cr_ce ' running forth for a dista^ce o~ TSree liundrea - ~eet, more or less, to•a point on T::inc (30°) ' ' the shore of Grass Tae; t~^_^ce deflect to the O ° right with an angle o= Si:ay-t::o Degrees (52 ) - xhirty-four :•~inutcs (34') f.r a distance of _ _ 10 5°.4 - feet,.~•--o~-a or less; Fiity--ni-ne- arrd-4/ -C ) • the^ce d^_f? _Ct t0 the '•' °`•'t O^- a^- 2^gle Of -J-• • fifty-foLr degrees (54°) t it*_y (30) r~'-pates ° V_•__.L~ ~ --?-- c=vit° '`.n(t Si`Ore OZ ura55 -L2 :2 . _ - for a distar-ce of•Sixty-ore (61) meet-, more - - or less; Lhence South Thee Div^dred Thirty-tag _ and 6/10 (332.6) feet, ^ore or aess, to z point - on the East end b?est ore-euzr*_er I=ne o~ said __ Section e'er-ty-seven (2'), c:^ic'r_ po=nt is T_ao - Hundred Fif-t,-si:c a^d 6/'_0 (256.6) feet East - of the l•:est one-eua-ter cor^er o_- Section '!`.peaty- - seven (27); thence T..'est to she ?Dint of be~ir_nrng; according to the Cnited St2tes Govern-=•ent Survey - thereof . - - _ That part of 'he Southeasterly S feet of the follo:aing described tract: ~ 'that part of Government Lot 1, in Section 27, Tov:nship 28, pange 24, cor.:nr_nci~7g at a point, :•~I~ich point is marked by judicial landmark, and is located 256.6 feet EJSt and 33 feet D:orth of the Soulh:~est corner of Government Lot 1; thence North parallel :•~ith blest line of"said lot 90.7 feet l'o a point r~:arked by a judicial landmark; thence at a right angle East 229.2 feet to point of intersection ~•iith the blesterly line of 1_;ndaie Avenue, :-:leech point is marked by judicial ]and:nark; thence South- :•:c"sterly along said 1 i,ic of Lynd~le ;venue °$.S feet to point of inter- section :dith the ilurth 1 ine of blest G6th Strcr_t, :ai~ich point is marked by judicial landmark; thr:nce blest along said line 195.7 feet to the point of •eg i nn i ng, - - ::rich lies sough:•:esterly of a line Jr~::n rort~:•::^starly at -right :::files to the .:rnit;,:~a,terly lines of said tr.-•~a from a f>•~int•il~crcon distant ~%9 f.et uorti:crsterly iru:n ti-,e southeast ~.orr,er of said tr:,r.L'; also Ci~at part of• caid tr.3ct lying south- r_astcrly of a line dre:,si rorti~._~stcrly from a point on the s~~~th l i,:c of said tract dist:~nt 16 fact :~:~_stcrly of the soutbca>t corner thereof, to a .;-.Dint on tie south- i::ct nor-ti:c~s~crl• of s~;d s,:ut'ne.°~t corner. estrrly__linc of said tract distant 16 J --- / ~ ~ 'l// ~~--~." HERSCHEL S. SWA N 8 ,' 1 ~~ ~: 't `r~ r t' ,~ r ~ i •~,. . i j o • :, ' ~" ~ ~ ~~ , .+ t ..".11 that part of f:ovr_rr~rnt Lot 1, Scctaon 27, To::n- r.l+ip ?.8 ::orth, F:^i:,;c 24 .ic$t •of the Four ti: Princiucl I~icridian, dcscriocc: as follo:;s: Corrrcncii:S or. a line parallel to and ?.55.0 :set East of C::c F:cst line of aid Section 27 at ,. point thcrin w::ich ~1 is -23~rr7• feet ::or^_h aloe:;; said line frc-i the South ~~•~ line of said Govcrr_^ent 1.ot 1, c:hich point is marked by a judicial lar.?:~eri; the^ce \or[h along said parallel line a ciste^c~ of 105.9 feet, thence Fast a distance of 305.5 _`eet, r:.ore or less, to an intersection :with the :•:este=ly line of Lyr:c?ale • Avenue, which point o~ _~~ersection is dote ^.~ir_ed by return i.^.g to the point o` 3eginnirg of said ° line .end coi:tirui^~ South z1o~g said parallel line a distance of 103 _`ee~,'therce South.82 degrees t 56 •minutes-Ezst 143.-7-meet; t:~enc2-\orth 82 deg:ces, 34 minutes E2st to the ?.'est lire of LynZale Avenue, thence Southerly alo::g sz_c latter line, 125 feet to said point of ter:n_r.at:on of •tl:e \outh 1?ne of the land ne:a bei^.o desc__Sed, thence Southwesterly along the ?•:esterly line o: -send Averca 2 distance of 113.4 feet, ^ore or less,"to a judicial 1zadT2r:c located °in said li^e zt z d_stznce of 95.5 feet • Idortliezster:y alor.~ said 1ir.e f-om a judicial . landmzr'_t plzced zt the rote=section of the ?:esterly line of szid Avenue and t:~e ;:ortii line of ?•:est 66th Street; the^ce ?•:est 229.2 `eet to the point of - beginning, 2ccorsino to the Gove_r_-rent Sun;ey thereof. - arc: ° That part o:.Goveurr^:^nt ?.ot 1, Section 27, To:a:^_shiD 28, Rar_oe 24, cot.-~eaci^~ zt e point, ~~hich point is marked by :jud;.cial lz:~s-:z r, ans is locates 256.6 feet Ezst and 33 feet \orti of the Sou t; :;est corer • of Goverr_-^.ent Tot 1; t::e^.ce `:orth parallel with-?;est line of said lot 90.7-feet to z point t?zukeZ by judicial landmar'~; tense st rioht.zn~les East 229.2 feet to the point of intersection with the '.;esteuly .line of Lyndale Avenue, ::hicz ooint is mar'.{ed by judicial izn2mar:c; the^ce Sott^:;esterly 21or_g said line of Lyndale Aven~° 55.5 _`eet to the point of 3ntcrsection ::ith t`:e South 1.^e of ?:est Si~_y-sixth• Street, :;bleb point is r..zr'_:ed by judicial la^dTau:~; thence ?•7cst along said line 195_7 feet to the point of beginning '• and • •" Tract D, Registered Land Survey No. 1318, Files of Registrar of Titles, County of Hennepin. HERSCHEL S . S47A N ------~ Field Qperations Division O~ 1501 West 80th Street ~(~, Room 213 ~[ ~ Bloouri~ogton, Minnesota 5531 ~a~ 26 ~9T ~a~aget May 2~, 1977 :i~~~,e~~ ~~ty R ,~ Richfield City Cc~.mcil ~ ~ . Stm~ry oP laze status QP Nii~.antte/Godfather pres~i.sess ~ - - -. Them is arh ez3.sting tax liability on these preza3.ses of approx-i.~tely . X50,000.00. The liable parties 3stvolved are Nick 2dinotte's Ina., Nick Minotta, and his partners,. ~zgan.e Chesen and 1~the~x Bohan. The State of QSO-~ has fYled s liexa in P.egi.ster of Deeds, Henzxr~piYZ County 3.n the ataouzit of ~33,?76.90 on the property an which prerr~'ts~s sits.. .: ~ _ Collection efforts have been,. and will continue to bef pursued a~inst-~ the responsible parties. To ths-t end, the State oP Minnesota has- been - ~~-•-.-;:;:; assi~ed an interest 1.n a note running from the Purch~ts®r of the busi- _ Hess, .icicn Az~sovino, to present owners, Dayton & Swa:.nj assigned ~ theat to Niek 1`fiiaxotte's, Inc., and assigned by Mlnotte's Sna. to ;3},.ate of _ M3.naesota (copy of proposal att$ched). They smUUnt of this Hots assiga~ went is X20,000•,00. P$yments on this-note will. be applied +„o -E2~e out- standi~ tax ~.iability. Collection effvx°ts will ear~.tizxna an tre remaining . liability.- _ As stated at the PRa.Y 23~ 197'T. hearizig~ this arrangement is less the satisfactory, but -in 'our 3udgcnt represents a practical cou~*~se to pursue at this time. It does not ~.ti.sfy the t~ liability to the - 7S~ta~-~ts of" :Minnesota. y~.It do®s repa sent the_ az~I3r s~sset available ~o~ .~•- - ~ ~ ~ ~ ~ -- t'il[~ii~$'ss, In~ie ~ t~.Ls~ e~~ ~~tterr ~~ a. _ - _' - -. - _ - - . .. ~ Frank Riley, Tax ~Xsminer k'isld (?veratians Division ,,. P'hoaae 8$0 - Attachrnsnt P.S. The State of Minnesota will furnish Lien Satisfactions covering above mentioned lien upon receipt of signed note, also referred to above, and after license is granted to applicant b~ the Richfield City Council. z~~? 850 IJorthwes 7900 Xerxes 1~7i nneapol i s, t "' ~T_ ~i ~ ~ ~. ~' ~ ~ ~7,3 P+~A'~ z ~ ]S77 ,:~;,,~ ,t ~., ~, ~terri~-Frrane~r~l - er~~e~-~: Av:enue~SocLth:~,~~,- =:? Minnesota 55431 May 18, 1977 hiessrs. Frank Riley and Jerry hicCl ure - Minnesota Department of Revenue •~'-} 1501 4lest 80th Street Room 213 Bloomington, Minnesota 55431 Re:. State Tax Liens - - Nick Minotte's, Inc. 708 i~lest 66th Street - Richfield, Minnesota Gentlemen: ' This will confirm our agreement. wherein, upon the sale of the _ _~ - ~ above-referenced real estate to The Godfather, -Inc., by Jerome C. Dayton - - and Herschel .S. Swain, a Note given as part payment for the purchase of the real estate in the principal amount of X20,000.00 shall be assigned by the sellers, Jerome C. Dayton and Herschel S. Swain, to Nick Minotte's, Inc., without warranty-and without recourse. The PJote ~viil then be assigned by Nick Minotte's,, Inc. to the State of rinnesota. The Note shall bear interest at the rate of eight percent per annum and shall be payable in equal monthly installments of $1,000.00 or more commencing approximately on the 8th day of tray, 1978 and each month thereafter until September.~28, 1979, when the entire unpaid principal balance shall become due and payabje. The assignment_of this PJote is conditioned upon the granting by the Richfield City Council of a liquor license to The Godfather,-Inc., and thereafter the timely closing of the sale of the real estate by Jerome C. Dayton and Herschel S. Swain to The Godfather, Inc. The undersigned guarantee the prompt performance by their clients of all acts ~c ssary to-accomplish these assignments. r L--.-- ~ / ~ . ~7 1 j' /~ ~--~ -!! - i~ / ~ --- Robert tR J. Ahl ~ ' ` h1er ' n l•1 Dahl - Attorney for tJick hii~notte's, Inc. _ • ~ ~ ,~ ~` - Dennis 4!. Strid Attorney for Jerome C. Dayton and Herschel S. Swain ... ~ , ,%' ~~b . , ! ~`~ o~ ay _ ~ - STATE OF MINNESOTA DEPARTMENT OF REVENUE Field Operations Division 1501 West 80th Street Room 213 Bloomington, Minnesota 55+31 May 2~+, 1977 Richfield City Council ~_ '; ~ .~ Summary of tax status of Minotte/Godfather premises: There is an existing tax liability an these premises of approximately X50,000.00. The liable parties involved are Nick Manotte's Inc., Nick Minotte, and his partners, Eugene Ghesen and 1`~athew Bohar. The State of Minnesota has filed a lien in Register of Deeds, Hennepin County in the amount of x33,776.90 on the property on which premises sits. Collection efforts have been, and will continue to be, pursued against___~ the responsible parties. To that end, the State of Minnesota has been assigned an interest in a note running from the Purchaser of the busi- ness, John Ansevino, to present owners, Dayton & Swain, assigned by them to Nick P~Tinotte's, Inc., and assigned by )`•ti.notte's Inc. to State of Minnesota (copy of proposal attached). The amount of this note assign- ment is X20,000.00. Payments on this note will be applied to the out- standing tax liability. Collection efforts ~ri.ll continue on~the remaining liability. As stated at the May 23, 1977, hearing, this arrangement is less than satisfactory, but_in.oux judger!ent represents a practical course~to pursue at this-time. It does not satisfy the tax liability to the State of Minnesota. It does represent the only asset available t~ Minotte's, Inc. in this entire matter.:;- - Frank Riley, Tax E- "ner Field Operations vision Phone 88~+-00+0 ~' Attachment R~ch~~,~,~; ~; AN EQUAL OPPORTUNITY EMPLOYER ~~' ~<~') CITY OF RICHFIELD, MINNESOTA Office of City Manager Council Letter No. 170 Agenda May 31, 1977 The Honorable Mayor and Members of the City Council City of Richfield Gentlemen: Subject: Dues Increase for League of Minnesota Cities At the last city council meeting the Mayor asked that the city council consider the proposed increase in LMC dues at the special council meeting on Tuesday, May 31st. A committee of the League of Minnesota Cities has been working on a proposed method for dues adjustments during the past year. That committee has made a recommendation which has been approved by the league board of directors and will come before the league membership for action at the annual meeting on Thursday, June 9, 1977. The last increase in league dues occurred in 1973. A copy of the article in the May, 1977 MINNESOTA CITIES magazine has been reproduced and is attached for your review. This article includes a list of the committee members who studied league financing, as well as specific amounts by which the City _ of Richfield dues would be increased. Respectfully subm' ted, ~,,,~ U~ Il~~- Wayne S. Burggraaff City Manager WSB/jkl