06-17-2019 Complete AgendaR E G U LAR H O U S IN G AN D R E D E V E LO P ME N T AU TH O R ITY ME E TIN G
R IC H F IE L D MU N IC IPAL C E N TE R, C O U N C IL C H AMB E R S
J U N E 17, 2019
7:00 P M
C all to Order
Approval of the Minutes
A pproval of the minutes of the: (1) S pecial concurrent C ity C ouncil and Housing and Redevelopment A uthority meeting
of May 20, 2019; and (2) Regular Housing and Redevelopment A uthority meeting of May 20, 2019.
AG E N D A APPR O VAL
1.A pproval of the A genda
2.Consent Calendar contains several separate items which are acted upon by the H R A in one motion.
Once the Consent Calendar has been approved, the individual items and recommended actions have
also been approved. No further H R A action on these items is necessary. However, any H R A
Commissioner may request that an item be removed from the Consent Calendar and placed on the
regular agenda for H R A discussion and action. All items listed on the Consent Calendar are
recommended for approval.
A .C onsider approval of revisions to the F irst Time Homebuyer P rogram Guidelines.
S taff Report No. 24
B .C onsider adoption of a resolution approving a S ubordination A greement and E stoppel C ertificate related
to construction financing for the C edar P oint II townhomes.
S taff Report No. 25
3.C onsideration of items, if any, removed from C onsent C alendar
P U B LIC H E AR IN G S
4.P ublic hearing and consider adoption of a resolution authorizing the sale of 6412 B loomington Avenue to E ndres
C ustom Homes and the approval of a C ontract for P rivate D evelopment with E ndres C ustom Homes for the
construction of a single family home through the Richfield Rediscovered P rogram.
S taff Report No. 26
H R A D IS C U S S IO N ITE MS
5.HRA D iscussion Items
E X E C U T IV E D IR E C TO R R E P O R T
6.E xecutive D irector's Report
C LAIMS AN D PAYR O L LS
7.C laims and P ayrolls
8.A djournment
Auxiliary aids for individuals with disabilities are available upon request. Requests must be made at least 96
hours in advance to the City Clerk at 612-861-9738.
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING MINUTES
Richfield, Minnesota
Special Concurrent City Council and
Housing and Redevelopment Authority
Work Session
May 20 , 2019
CALL TO ORDER
The work session was called to order by Chair Supple at 5:30 p.m. in the Bartholomew Room.
HRA Members Mary Supple, Chair; Pat Elliott; Maria Regan Gonzalez; Sue Sandahl; and
Present: Erin Vrieze Daniels.
Council Members Maria Regan Gonzalez, Mayor; Mary Supple; Edwina Garcia, and Ben
Present Whalen.
Council Members Simon Trautmann.
Absent:
Staff Present: Katie Rodriguez, City Manager; John Stark, HRA Executive
Director/Community Development Director; Julie Urban, Housing Manager;
and Melissa Poehlman, Assistant Community Development Director.
Item #1
REDEVELOPMENT PRIORITIES
Community Development Director Stark presented an overview of redevelopment and the
agenda for the work session.
Policymakers spent time answering the question, “Why do we redevelop?” Community
Development Director Stark and Assistant Community Development Director Poehlman described
several geographic areas that are identified for potential redevelopment in the Comprehensive Plan,
along with topic areas of Housing Opportunities and Missing Uses and described the strengths,
weaknesses, opportunities, and threats (SWOTs) of each area. Policymakers added to SWOTs to
each area.
Assistant Community Development Director Poehlman and Housing Manager Urban asked
policymakers to then prioritize four of the areas. Working in pairs they narrowed down the priorities to
two areas and presented those priorities to the group. Results indicated that specific geographic areas
were less of a priority and that jobs, new/missing uses, and housing were important to the group.
ADJOURNMENT
Special concurrent Council and HRA Work Session -2- May 20, 2019
The work session was adjourned by unanimous consent at 6:58 p.m.
Date Approved: June 17, 2019
Mary B. Supple
HRA Chair
Kate Aitchinson John Stark
Housing Specialist Executive Director
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING MINUTES
Richfield, Minnesota
Regular Meeting
May 20, 2019
CALL TO ORDER
The meeting was called to order by Chair Supple at 7:19 p.m. in the Bartholomew Room.
HRA Members Mary Supple, Chair; Pat Elliott; Maria Regan Gonzalez; Sue Sandahl; and
Present: Erin Vrieze Daniels.
Staff Present: John Stark, Executive Director; Melissa Poehlman, Assistant Community
Development Director; Julie Urban, Housing Manager; Julie Eddington, HRA
Attorney; Rebecca Kurtz, Ehlers & Associations; and Kate Aitchison,
Housing Specialist.
APPROVAL OF THE MINUTES
M/Regan Gonzalez, S/Elliott to approve the Special concurrent City Council and Housing
and Redevelopment Authority meeting of April 15, 2019; Regular Housing and Redevelopment
Authority meeting of April 15, 2019; and Special concurrent City Council, Housing and
Redevelopment Authority, and Planning Commission work session of May 7, 2019
Motion carried 5-0.
Item #1
APPROVAL OF THE AGENDA
M/Elliott, S/Vrieze Daniels to approve the agenda.
Motion carried 5-0.
Item #2
CONSENT CALENDAR
Executive Director Stark presented the consent calendar:
A. Consider adoption of a resolution authorizing the Housing and Redevelopment Authority
to affirm the monetary limits on statutory municipality tort liability. (S.R. No. 18)
B. Consider adoption of a resolution authorizing execution of a Development Agreement
with the West Hennepin Affordable Land Housing Trust, dba Homes Within Reach, for
the acquisition, rehabilitation and sale of houses under the New Home Program utilizing
Federal Fiscal Year 2018 Community Development Block Grant funds. (S.R. No. 19)
HRA Meeting Minutes -2- May 20, 2019
C. Consider adoption of a resolution approving an Assumption Agreement between NHH
Companies, LLC, Cedar Point Investments LLC, and the Housing and Redevelopment
Authority. (S.R. No. 20)
D. Consider adoption of a resolution adopting a modification to the Tax Increment
Financing Plan for the Lyndale Gardens Tax Increment Financing District. (S.R. No. 21)
M/Sandahl, S/Regan Gonzalez to approve the consent calendar.
Motion carried 5-0.
Item #3
CONSIDERATION OF ITEMS, IF ANY, REMOVED FROM CONSENT CALENDAR
None.
Item #4
CONTINUATION OF A PUBLIC HEARING FROM APRIL 15, 2019 AND CONSIDER
ADOPTION OF A RESOLUTION AUTHORIZING THE SALE OF 6310 IRVING
AVENUE SOUTH TO TWIN CITIES HABITAT FOR HUMANITY AND THE
APPROVAL OF A CONTRACT FOR PRIVATE DEVELOPMENT FOR THE
CONSTRUCTION OF A SINGLE FAMILY HOME. (S.R. NO. 22)
Housing Specialist Kate Aitchison presented Staff Report No. 22.
Commissioner Sandahl asked about the alley serving the property and the scenarios that
have been explored by staff. Housing Specialist Aitchison explained the various options that were
explored for this development.
Chair Supple opened the public hearing.
Thomas Dallman, 6309 James Avenue, expressed his disappointment that the alley will
continue to be in use. He stated that there are negative impacts on his property with cars and
pedestrians accessing the alley. He state d that the adjacent home is very small and in poor
condition and should be acquired to combine lots for more efficient size. He also inquired into the
materials to be used for the alley.
Commissioner Elliott asked about whether the neighbors would be assessed for this alley
improvement. Housing Specialist Aitchison stated that Twin Cities Habitat for Humanity would
assume the full cost of the construction of the alley.
Judy Moe, currently displaced but a former resident of Richfield, stated her support for the
development of this property. She stated she is in the process of applying for housing with Twin
Cities Habitat for Humanity and hopes to stay in Richfield in the future. She stated her support for
this type of housing, as it is very important for the community.
Raven Moe, currently displaced by a former resident of Richfield, stated that she doesn’t
currently have permanent housing. She voiced her support for this type of development because
the accessibility components included are important.
M/Sandahl, S/Vrieze Daniels to close the public hearing.
Motion carried 5-0.
HRA Meeting Minutes -3- May 20, 2019
Chair Supple asked about the value and sale price of the property. Housing Specialist
Aitchison responded and provided more details about the $1 price for Twin Cities Ha bitat for
Humanity.
Commissioner Vrieze Daniels asked about garbage pickup. Housing Specialist Aitchison
responded with details about garage placement and alley layout.
M/Regan Gonzalez, S/Sandahl to adopt a resolution authorizing the sale of 6310 Irving
Avenue South to Twin Cities Habitat for Humanity, and approve a Contract for Private
Development with Twin Cities Habitat for Humanity for the construction of a single family home,
contingent upon final Housing and Redevelopment Authority's Attorney review.
Commissioner Vrieze Daniels stated that the positive features of this development outweigh
the negatives and has her support.
Chair Supple stated her support for the accessibility -features included in development.
Motion carried 5-0.
Item #5
PUBLIC HEARING AND CONSIDER ADOPTION OF A RESOLUTION APPROVING
A CONTRACT FOR PRIVATE DEVELOPMENT WITH MWF PROPERTIES FOR
REDEVELOPMENT OF THE CITY GARAGE SOUTH SITE AT 7700 PILLSBURY
AVENUE S WITH 55 UNITS OF AFFORDABLE WORKFORCE HOUSING. (S.R.
NO. 23)
Housing Manager Julie Urban presented Staff Report No. 23. Executive Director John Stark
added that two work sessions were held with policymakers and that while there are some
unanswered questions about design, those would still be addressed during th e approvals process
with the Planning Commission and City Council.
Chair Supple opened the public hearing.
Tim Carter of Richfield Bloomington Honda, located at 501 77th Street West, stated that he
is currently leasing the site from the city for employee parking, and that 170 employees park there
and walk to work. He anticipates future growth in his business an d number of employees and
would need to find a new solution for parking for his employees. He stated he appreciates the
communication that he has received from the city about this projects and its impacts on his
business.
Luci Peterson, 2500 66th Street West, Apartment 308, spoke in favor of the project.
Peterson stated that a flyer at VEAP’s office in Bloomington shows that Richfield has fewer
affordable housing opportunities than surrounding communities. Peterson stated the need for
affordable housing and shared their personal experience looking for supportive, affordable
housing.
Judy Moe, currently displaced but a former resident of Richfield, stated her support for the
project. She explained her current housing situation and the high costs of rent. She stated her
need for housing with an elevator, hardwood floors and wider doorways to accommodate her
daughter’s wheelchair. She stated that she believes the site is good because it is on a bus route,
near amenities. She stated that she would live there and many others in need of housing would as
well. She stated that she believes some concerns can be addressed, and then people should be
given the ability to decide if they want to live at this property.
HRA Meeting Minutes -4- May 20, 2019
M/Regan Gonzalez, S/Vrieze Daniels to close the public hearing.
Motion carried 5-0.
Commissioner Elliott stated that he is planning to vote against the project as he has
continued objections to this specific site for housing.
Commissioner Elliott asked how site control under the developer will impact Mr. Carter’s
current situation. Housing Manager Urban stated that the closing of the property wouldn’t happen
until the Tax Credits are awarded, likely in the year 2020. Commissioner Elliott asked for
clarification on what ‘site control’ means for the de veloper. Housing Manager Urban stated that it
means the developer has a Purchase Agreement and has shown they have the ability to officially
acquire the property.
Commissioner Elliott asked if 4(D) tax credits will impact the TIF analysis. Executive
Director Stark stated that the TIF analysis does include those tax credits and still allows for the city
to receive the expected TIF payment. Commissioner Elliott asked for clarification on the timeline for
the project. Housing Manager Urban responded.
Commissioner Elliott asked for clarification on the income -averaging that will occur with the
tenants of this project.
Chris Stokka, MWF Properties, explained the new formula that is being used for the tax
credit applications. He explained that a certain numbe r of units will be allocated at each income
level. No households will be over 70% of Median Area Income.
Commissioner Elliott asked for clarification on rent prices. Mr. Stokka responded and
provided estimated rents for the units.
Commissioner Elliott asked about screening criteria for applicants and the status of
individuals or families. Mr. Stokka stated that the management company they use is well versed in
Fair Housing laws and that they will not discriminate on familial status.
Commissioner Elliott asked where the children who live in the building will play. Mr. Stokka
responded that a ‘tot-lot’ will be on-site for children ages 3-7. Older children typically go off -site for
activities. A community room and fitness center will also be provided .
Commissioner Elliott asked about pedestrian access across 77th Street. Mr. Stokka stated
that further conversations haven’t happened yet, but that it will be addressed as part of the land
use approval process once the site is under contract.
Commissioner Elliott asked about the open house that was held. Mr. Stokka responded that
the open house went well, and was attended by policymakers and city -staff. Executive Director
Stark stated that it was a well-attended open house, and that numerous small-business owners
attended as well. Their concerns were focused on future land -use of the area, as well as parking
and traffic. Three residents attended and provided positive feedback.
Commissioner Elliott asked about traffic management plans. Housing Manager U rban
stated that those concerns would all be addressed during the land use approvals process.
Executive Director Stark stated that some high -level conversations have been had concerning 77th
Street in a broader context.
HRA Meeting Minutes -5- May 20, 2019
Commissioner Regan Gonzalez stated she received three letters of support from residents
for this property. She asked for clarification on the timing of this development. Housing Manager
Urban responded that land use approvals would be required by June 1, 2020, and they would be
expected to close in the Fall of 2020.
Chris Stokka, MWF Properties, stated they would be ready at the earliest in April or May of
2020, but they are willing to work with the city and Mr. Carter on timing.
Commissioner Regan Gonzalez clarified that this decision isn’t final, and that there would
be continued conversations about design and amenities. Mr. Stokka responded that yes, they
would begin bringing in engineers and architects to really finalize the plans.
Commissioner Regan Gonzalez also stated that she believes it is a quality project that will
benefit families, residents with disabilities and supportive services. She stated she believes it is
important to keep addressing concerns from the nearby businesses. She stated she’d like to see
what the impacts of 494 reconstruction and the Highway 77 underpass will have on this area. She
also stated her desire to continue working with Mr. Carter on his parking needs.
Executive Director Stark stated that city staff has had conversations with Mr. Carter about
other possibilities. He has a current Interim Use Permit (IUP), which can only last for 5 years, so
the timing of the issue isn’t based on this development. Both parties are exploring other options.
Commissioner Regan Gonzalez asked when the tax credits wi ll be awarded. Mr. Stokka,
MWF Properties, stated they will be notified on November 1, 2019.
Commissioner Vrieze Daniels stated her support for the project, despite the challenges that
need to be addressed.
Commissioner Sandahl asked for clarification on the number of units. Mr. Stokka, MWF
Properties, stated that it will be based on land use approvals from the city. Commissioner Sandahl
asked about parking. Mr. Stokka stated that they are planning on 1 .5 stalls/unit for parking. She
stated her concern o ver this proposal being surrounded by commercial business, but that she will
support it because it is a type of housing that we need. She suggested Mr. Carter talk to area
churches about parking options.
Chair Supple stated her support for this project and its focus on lower-income households,
as well as the accessibilities features and supportive services. She stated she did attend the open
house and stated her desire to continue addressing concerns.
M/Regan Gonzalez, S/Vrieze Daniels to adopt a resolution approving a Contract for Private
Development with MW F Properties for the City Garage South site at 7700 Pillsbury Avenue S and
selling the Housing and Redevelopment Authority owned property to MW F Properties.
Motion carried 4-1, with Commissioner Pat Elliott voting nay.
Item #6
HRA DISCUSSION ITEMS
Chair Supple announced upcoming Southdale Library Open Houses: May 30th from 6 PM –
8 PM, and June 8th from 10 AM – 12 PM.
Commissioner Regan Gonzalez thanked staff for the redevelopment study session that was
held prior to the HRA meeting.
HRA Meeting Minutes -6- May 20, 2019
Commissioner Sandahl stated that the Richfield Bandshell Opening will be held on June 9th
at 6 PM. There will be 2 bands performing.
Commissioner Vrieze Daniels asked about a concern voiced by residents that when they
purchase a home they do not know what the zoning is. She asked that it be included in future
conversations. Executive Director Stark stated that it can be addressed in the fu ture.
Item #7
EXECUTIVE DIRECTOR REPORT
None.
Item #8
CLAIMS AND PAYROLLS
M/Sandahl, S/Regan Gonzalez that the following claims and payroll be approved :
U.S. BANK 05/20/2019
Section 8 Checks: 130707 - 130791 $168,922.19
HRA Checks: 33636 - 33646 $3,834.28
TOTAL $172,756.47
Motion carried 5-0.
Item #9
ADJOURNMENT
The meeting was adjourned by unanimous consent at 8:29 p.m.
Date Approved: June 17, 2019
Mary B. Supple
HRA Chair
Kate Aitchison John Stark
Housing Specialist Executive Director
AGENDA SECTION:Consent Calendar
AGENDA ITEM #2.A.
S TAFF REPORT NO. 24
HOUSING AND RE DEVELOPMENT AUT HORIT Y
MEET ING
6/17/2019
RE P O RT P RE PA RE D B Y: K ate A itchison/C eleste McD ermott, Housing S pecialists
O THE R D E PA RTM E NT RE V IE W: N/A
E X E C UTIV E D IRE C TO R RE V IE W: J ohn S tark, E xecutive D irector
6/7/2019
I T E M F O R C O UNC IL C O NS ID E RAT I O N:
Consider approval of revisions to the First Time Homebuyer Program Guidelines.
E X E C UT IV E S UM M ARY:
The First Time Homebuyer Program (P rogram) Guidelines were approved by the Housing and
Redevelopment Authority (HRA) in J uly of 2018 and updated to incorporate additional federal requirements in
November 2018. Since the Program launched, there has been c onsiderable interest from both Richfield
renters and those from other c ommunities looking to move to Richfield. There have been two first time
homebuyer loans completed thus far. An additional three applicants have been pre-approved; however, they
have been unable to find homes given the high pric es and low inventory available. Of those who have been
pre-approved, two have started to search for homes in other cities due to how diffic ult it is to compete for a
home in Richfield.
I n order to most effec tively use the funds and promote affordable home ownership in Ric hfield, staff
recommends making the following changes to the Program guidelines:
1. Remove the requirement that applicants be current Richfield renters, thus c reating affordable home
ownership opportunities for more low and moderate income buyers who are looking to purchase in
Richfield.
2. Maintain the base loan amount at a maximum of $10,000 but allow eligible households to receive an
additional $5,000 for a total loan amount up to $15,000. Eligible households would need to meet at least
one of the following:
applicant is a current Richfield renter;
the household has at least one dependent under the age of 18; or
one or more household members has a documented disability.
These groups were selected based on researc h done by the Minnesota Housing Finance A genc y that
outlined the most effective methods of addressing disparities and targeting under served populations.
3. Remove the requirement that applicants use a Minnesota Housing approved lender, per a
recommendation from Minnesota Housing staff.
RE C O M M E ND E D AC T I O N:
By motion: Approve revisions to the First Time Homebuyer Program Guidelines.
B AS IS O F RE C O M M E ND AT I O N:
A.H IS TOR IC AL C ON T E X T
The Program Guidelines were initially approved by the HRA in J uly of 2018.
Revisions to the Program Guidelines were approved in October of 2018.
I n 2017 and again in 2018, the Star Tribune listed Richfield as the hottest housing market in the
Twin Cities. This measure was based on price, time on the market, seller discounts and the
number of short-sales/foreclosures in the community. These factors have led to a low inventory of
houses for sale and rising home prices, making it difficult for low and moderate income
households to afford a home in Richfield.
Over the years, various HRA programs have been available to assist first time homebuyers with
rehabilitation of their new homes and low income buyers to purchase homes. Richfield has never
previously administered a first time homebuyer program.
The demand for down payment assistance is great, as homebuyers struggle to meet rising home
prices without taxing their monthly spending.
Staff began discussions about the potential Program in 2017 and has since met with various
stakeholders and partners to discuss the Program Guidelines and administration.
Two down payment assistance loans have been issued through the Program.
B.P OL IC IE S (resolutions, ordinances, regulations, statutes, etc):
I t is the HRA’s policy to provide homeownership opportunities to households of a variety of income
levels.
I n 2013, the Richfield HRA adopted a Housing Visioning Statement that states: "Richfield is a
sustainable community that is known for its strong, vibrant and eclectic, amenity-rich
neighborhoods supported by a full range and balance of housing types that match the choices of
its diverse residents at every stage of their lives."
The Housing Visioning Task Force explained that the phrase "match the choices of its
diverse residents at every stage of their lives" to mean: "that the City has what residents
want, not just what they have to adapt to. The Task Force supports a broad definition of
diversity. These varied housing offerings mean that residents can stay in the community
their whole lives and find housing that meets their needs and their preferences."
All Community Development Block Grant (C D B G) funded activities must meet one of three
national objectives: benefiting low and moderate income persons, preventing or eliminating slums
and/or blight, or meet an urgent need. I n addition, activities must be consistent with priorities
identified in the County's Consolidated Plan. Those priorities include a variety of housing activities
such as housing rehabilitation, preserving and creating homeownership opportunities, public
services to maintain or increase self-sufficiency, and neighborhood revitalization activities.
C.C R IT IC AL T IMIN G IS S U E S:
The revisions are recommended by staff in order to address current affordable housing needs and
effectively utilize the funds during the C D B G program year.
The C D B G 2018 program cycle ends J uly 1, 2019. An extension to utilize the funds has been
filed and will give until December 31, 2019 to utilize 2018 funds. I f not spent it will be
reprogrammed to the Deferred Loan program.
The 2019 C D B G program cycle ends J uly 1, 2020.
D.F IN AN C IAL IMPAC T:
For FF Y 2018, $50,000 has been budgeted for the Program with $40,000 remaining.
For FF Y 2019 an additional $50,000 has been budgeted for the Program.
The funding source for the Program is federally-funded C D B G, which Richfield receives as part
of the Consolidated Pool through Hennepin County.
Funds will be distributed in the form of a no-interest loan to buyers that will be forgiven on a pro-
rated basis over ten years.
The maximum individual loan amount is currently $10,000. Staff is proposing raising that amount
to $15,000 for applicants who meet additional criteria.
I f the full amount of funding is not expended within the required time period, it can be moved to the
Richfield Deferred Loan Program, which provides rehabilitation loans for low and moderate-
income households in Richfield.
E.L E GAL C ON S ID E R AT ION:
The HRA Attorney has reviewed the Program Guidelines.
ALTE R N AT IV E R E C O MME N D ATIO N(S):
The HRA may choose to not approve the recommended revisions to the First Time Homebuyer
Program Guidelines.
P R IN C IPAL PAR TIE S E X P E C TE D AT ME E TIN G:
N/A
AT TAC H ME N T S:
D escription Type
F irst Time Homebuyer Guideline- Revised C over Memo
1
City of Richfield
First Time Homebuyer Program
Part I: GENERAL PROGRAM DESCRIPTION
Program Overview
The Richfield Housing and Redevelopment Authority (HRA) offers a financial assistance program for
homeownership funded by the City of Richfield’s Community Development Block Grant (CDBG) program.
The First Time Homebuyer Program provides financial assistance for low and moderate income
households to become homeowners.
Administration of the First Time Homebuyer Program and the functions and responsibilities of the HRA
staff shall be in compliance with the U.S. Department of Housing and Urban Development (HUD) CDBG
regulations as well as all Federal, State and local nondiscrimination laws and with the rules and
regulations governing Fair Housing and Equal Opportunity in housing and employment.
No family or individual shall be denied the equal opportunity to apply for or receive assistance under the
First Time Homebuyer Program on the basis of race, color, gender, religion, creed, national origin, age,
familial or marital status, handicap or disability, sexual orientation or reliance on public assistance.
The HRA office is accessible to persons with disabilities. Accessibility for the hearing impaired is
provided by the Minnesota Relay Service and the City of Richfield.
Program Goals
The First Time Homebuyer Program has the following two goals:
a. Assist low and moderate income families, particularly those who rent in Richfield, to purchase
homes within the City of Richfield by providing assistance with down payment, closing costs and
mortgage principle reduction.
b. Promote responsible home ownership
Program Administration
The Program will be administered through the HRA. Interested applicants should contact
HRA staff by calling 612-861-9778.
Data Privacy
The HRA is subject to Minnesota Statutes Chapter 13 (the “Minnesota Government Data Practices
Act”). Under the Minnesota Government Data Practices Act, the names and addresses of applicants for
or recipients of assistance under this program and the amount of assistance received under this
program are public data. All other financial information submitted to the HRA for purposes of the loan
application is considered private data.
Purpose of the Program Guidelines
The purpose of these guidelines is to establish policies for carrying out the First Time Homebuyer
Program in a manner consistent with HUD requirements and local goals and objectives contained in the
City of Richfield’s Consolidated Plan and Annual Action Plans. The HRA is responsible for complying with
2
all changes in HUD regulations pertaining to the CDBG program. If such changes conflict with these
guidelines, HUD regulations will have precedence. Application regulations include:
24 CFR Part 8: Nondiscrimination
24 CFR Part 570: Community Development Block Grant
24 CFR Part 35: Lead Based Paint Regulations
PART II: PROGRAM POLICIES
Financial Assistance
The financial assistance is in the form of a loan of up to $10,000, or up to $15,000 if additional
eligibility requirements are met, but no more than 10% of the purchase price. There is no interest on
the loan and no payments are required. The loan is forgiven on a pro-rated basis of 10% each year and
is fully forgiven after 10 years. If the home is sold, the title transferred, or no longer owner-occupied,
within the first 10 years after the purchase date, then the remaining pro-rated amount will be become
due.
The Financial Assistance may be used to:
Pay up to 50% of the amount the homebuyer is required to provide toward the down payment
under the particular mortgage program they are utilizing. The homebuyer must contribute a
minimum of $1,000 of their own funds towards the downpayment.
Pay up to 100% of the homebuyer’s eligible closing costs. Borrowers are permitted to use
program funds for interest rate buy downs if documentation is provided from the lender that
shows the buy down is necessary to secure their primary mortgage.
Reduce the mortgage principal up to 10% of the purchase price, up to$150,000, depending on
eligibility. The applicant(s) housing ratio must be at least 25%, but cannot exceed 35% of their
gross monthly qualifying income. The housing ratio is calculated using the current year’s
projected income. Under certain circumstances, the HRA Executive Director may allow the DTI
to exceed 35%.
The financial assistance will be provided at a minimum amount of $3,000.00 and a maximum amount of
$150,000.00. In certain situations, the HRA Executive Director may allow assistance in excess of the
maximum at their discretion. The HRA Staff will review the applicant’s verified income and assets,
estimated closing costs, purchase agreement, and lender’s recommendations for financial assistance in
compliance with uses described above. Lenders must provide a pre-approval letter indicating the
maximum amount of financing the borrower would qualify for from the first mortgage lender.
The HRA will verify an applicant’s income and assets through written verifications as provided by either
the lender or by the applicant. The HRA staff may re-verify income and asset information provided by
the lender. The HRA will calculate the applicant’s gross annual income using paystubs and recent tax
returns or other qualifying verification as determined by HRA staff to ensure the applicant(s) qualifies as
a low or moderate income household as required by CDBG regulations and to determine the maximum
amount of assistance.
3
Financial assistance will be provided at the time of closing on the property with the following conditions:
Selected applicants must meet the requirements of the program and be eligible for the financial
assistance throughout the entire application process.
The housing unit to be purchased and the purchase price must be accepted by the HRA as
meeting the intent and requirements of the program.
The financial assistance provided by the program is in the form of a no-interest loan that is
forgiven 10 years from the initial purchase date. If the house is sold, transferred or no longer the
primary place of residence within that 10 year period, the loan will be repaid on a pro-rated
basis.
The homebuyers must enter into a second mortgage and execute a Repayment Agreement with
the HRA providing for repayment of the indebtedness 10 years from the initial purchase date or
when the house is sold, transferred or no longer the primary place of residence, whichever
occurs first.
Responsibilities of the First Time Homebuyer
The responsibilities of the prospective homebuyers are to:
Obtain mortgage pre-qualification from a Minnesota Housing approved lender
Submit a pre-application and mortgage pre-qualification to the HRA
Complete, sign and return the full application packet, authorization for release of information
form, and other certification and verification forms within the time frame specified.
Register and attend the Home Stretch or Framework – Homebuyers workshop such as those
offered by Community Action Partnership of Hennepin County (CAP-HC), Neighborhood
Development Alliance (NeDA), NeighborWorks Home Partners, or PRG Inc. More information
about homebuyer education can be found online at:
http://www.hocmn.org/buyingahome/homebuyer-education/. Classes must have been
completed within 12 months prior to closing. The applicant will be provided with a certificate of
attendance. A copy of this certificate should be forwarded to the lender and the HRA.
Select a real estate agent, if one is desired.
Select a dwelling in Richfield for purchase that is owner-occupied or vacant and is an eligible
dwelling under the program.
Provide information throughout the process as required by the lender or the HRA staff.
Execute a purchase agreement that includes the Environmental Review addendum supplied by
the HRA, and any subsequent Amendments.
Execute the lender’s mortgage and related documents.
Execute the HRA’s Mortgage, Loan Agreement and Promissory Note.
4
Close on the property within the time frame specified in the Purchase Agreement.
Execute other required forms within the time frame specified or required.
Take occupancy of the dwelling within 30 days after closing, homestead the property, and
continue to occupy the dwelling as a Principal Place of Residence.
Make principal, interest, property tax and insurance payments as required.
Reimburse the HRA in accordance with the HRA’s Mortgage, Loan Agreement, and Promissory
Note should the First Time Homebuyer trigger repayment through sale, moving, transfer of
ownership or foreclosure within 10 years or default on any other terms of these documents.
Responsibilities of the Lender
The lender must:
Verify the prospective homebuyer’s income and assets to determine that they meet the
requirements of the program and submit a copy of the verification to the HRA. These copies
must be submitted to the HRA as part of a completed application.
Compute the Mortgage, Down Payment, Mortgage payments and Closing Costs of Acceptable
Loans approved by the Program to determine the most cost-effective and appropriate form of
financing for the First Time Homebuyer to use.
Provide a title search and review the documents.
Provide the HRA with a pre-approval letter stating the maximum mortgage amount the
applicant is approved for.
Provide the HRA other verification materials as requested by the HRA.
Process a mortgage consistent with the Program.
Meet all deadlines in a timely fashion, especially those that relate to the Closing. All documents
must be completed at least 10 days prior to the Closing and be delivered to the HRA at least
seven days before the Closing.
Appraise property to determine the loan-to-value ratio. Provide copy to the HRA.
Responsibilities of the HRA
The responsibilities of the HRA for the Program are to:
Establish Program requirements and administer the Program.
Send applicants the application form, the authorization for release of information form and
other certification and verification forms.
Review the Application and other material for eligibility.
5
Establish the initial eligibility of participants via the information provided in the pre-application
process. Full approval will be determined upon completion and submission of a full application
and supporting documents.
Notify applicants when ineligible.
Direct prospective buyers to register for the homebuyer workshops and provide information
and forms related to the Program.
Provide liaison services involving the prospective buyer, lender and any real estate agent that
might be involved in the transaction.
Review appraisal, purchase agreement, eligibility and mortgage for consistency with the
Program requirements.
Prepare and execute the HRA Mortgage, Loan Agreement, and Promissory Note.
Provide financial assistance according to Program guidelines to the applicant at the time of
Closing.
Service the HRA Mortgage, Loan Agreement, and Promissory Note.
Modify or terminate the Program as may be appropriate or required.
Pre-Application Process
At the time of application, applicants must provide the HRA with the following information and meet the
eligibility requirements:
Names and ages of all household members who will occupy the property purchased
Address and telephone numbers
Total gross annual income documentation..
Lease start and end dates, if applicant is a Richfield renter.
Letter from lender indicating the amount of a home loan for which applicant is pre-qualified
Authorization for release of information/data privacy signed by all adults in the household.
The information listed above will provide the HRA sufficient information to determine if the applicant is
applicant is eligible for the Program. The pre-application must be submitted prior to the execution of a
purchase agreement. Applicants will be notified if they are eligible or ineligible based on the information
provided in the pre-application.
It is the responsibility of each applicant to ensure that the information is correct and that the HRA
receives his or her application.
6
Supporting Documentation
Eligible applicants will be required to submit the following supporting documentation. Some items may
be waived by the HRA Executive Director if not applicable and additional documentation may be
requested:
Authorized Purchase Agreement on a home in Richfield (must include Environmental Review
Addendum supplied by HRA staff after Pre-Application is reviewed)
Pay stubs for all household members earning income.
Tax returns stubs for all household members earning income.
Bank statements, financial statements and all other document(s) that verify gross assets.
Copy of current lease, if applicant is a Richfield renter. .
Previous addresses.
Proof of completion of an approved homebuyer workshop.
Summary of the Application Process
If the applicant qualifies to apply for the Program, the applicant should proceed with the application
process, which includes:
The applicant selects a participating lender and applies for mortgage pre-approval.
The applicant completes and submits to the HRA: (i) a First Time Homebuyer application;
(ii) authorization form for release of information to the HRA ; and (iii) a mortgage pre-approval
letter from the lender.
The applicant is notified by the HRA whether or not they are eligible for the Program based on
the information provided.
The applicant registers for and attends the homebuyer workshop series.
The applicant searches for a home in Richfield.
The applicant enters into a Purchase Agreement that includes the Environmental Review
Addendum provided by the HRA and contacts the lender.
The lender authorizes appraisal of home.
The lender confirms applicant’s mortgage eligibility and approves purchase.
The applicant contacts the HRA with supporting documentation.
The HRA confirms any/all lead-based paint hazards have been investigated and remediated prior
to closing. See Lead Based Paint Hazard Requirements under Part Three of the guidelines for
more information.
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The HRA reviews appraisal, Purchase Agreement, Loan Estimate, and eligibility verification for
consistency with program goals and requirements.
The HRA issues an approval letter or denial letter to applicant.
If approved, an Environmental Review is completed on the property by the HRA.
The HRA prepares the closing documents required by the City’s First Time Homebuyer Program
Guidelines.
Post Approval Process
After receiving the application and all of the supplemental documentation, the following procedures
shall apply:
If the application meets the program requirements, the loan funds (not to exceed $150,000) will
be reserved for the applicant and brought to the closing.
The HRA loan closing will occur in conjunction with the transfer of property closing. The HRA
will provide the full amount of the loan ($10,000), payable to the Buyer AND the Title Company
conducting the closing.
HRA staff will make its best effort to attend the closing. If HRA staff is unable to attend the
closing, the loan closing or title insurance company conducting the loan closing will be
responsible for recording the HRA’s mortgage. The purchaser will pay the filing fee. If HRA staff
has not attended the closing, the title company must provide Richfield staff with a copy of the
first mortgage executed and filed, as well as an executed Promissory Note, Errors and Omissions
Acknowledgement Agreement, and Certificate and Request for Notice: Foreclosure. These
documents must be executed prior to any loan disbursement.
a. A lien will be placed against the Property by the HRA for the full loan amount
through the Mortgage Deed.
b. The Mortgage is subject to Mortgage Registration Tax; the Buyer is responsible for
the payment.
c. The Note may not be assigned or pledged.
HRA staff will provide homeowners with a copy of their loan documents, along with
information regarding loan subordinations and servicing.
Eligibility Requirements
To be eligible to participate in the Program and receive a loan up to $10,000, the applicant must meet
the following requirements at the time of application and throughout the process up until Closing.
Must be a current renter in Richfield with verifiable lease and proof of rent paid, showing at
least 6 months tenancy in Richfield.
Must have no prior home ownership in the past 3 years (unless displaced due to divorce).
Must be a U.S. citizen or have legal immigration status.
Must be a First Time Homebuyer, as defined in Appendix A.
8
Must not have a Gross annual Income that exceeds the maximum income limits which are
revised annually to reflect the current year’s CDBG maximum income limits. Income is calculated
using prior year tax returns and verified by most recent paystubs. For information on calculating
income, please contact a Richfield Housing Specialist.
FY 20198 CDBG Income Limits
Calculated as 80% of the Area Median Income. Source:
https://www.hudexchange.info/resource/5334/cdbg-income-limits/
Household Size Household Income Limit
1 Person Household $50,35052,850
2 Person Household $57,55060,400
3 Person Household $64,75067,950
4 Person Household $71,90075,500
5 Person Household $77,70081,550
6 Person Household $83,45087,600
7 Person Household $89,20093,650
8 Person Household $94,95099,700
Must not have Gross Assets exceeding $25,000.00, excluding retirement savings.
Borrowers are required to invest at least $1,000.00 of their own monies towards the purchase
price of the home.
Must meet the requirements of a Lender and qualify for a first mortgage.
Loan must be a fixed-rate, prime loan. No adjustable or balloon mortgages.
Must fulfill the Program obligations in a timely manner and must remain eligible to participate
based on the program requirements and those of the lender through the time of Closing.
Must not have a previous loan through the HRA that ended in foreclosure or any other loan that
ended in foreclosure within the previous five years.
Must not buy dwelling with a contract for deed.
Must meet the requirements as specified elsewhere in these First Time Homebuyer Program
Guidelines.
Applicants who meet one of the following criteria (in addition to meeting the requirements
listed previously) will be eligible for a total loan amount up to $15,000. The final loan amount is subject
to current funding availability.
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Applicant is a current renter in Richfield with verifiable lease and proof of rent paid, showing at
least 6 months tenancy in Richfield.
Household has at least one dependent under the age of 18.
One or more household member is disabled (as verified by a physician signed form)
Denial of Eligibility
The HRA will review and verify all applications for eligibility. Those applicants not meeting the eligibility
requirements will be sent a written notice explaining the reason(s) for denial of program participation.
Appeals regarding interpretation of eligibility requirements may be made in writing to the HRA Executive
Director, and then to the Director of Community Development and then to the City Manager, and then
to the HRA Board. Appeals that clearly do not meet eligibility requirements will not be considered.
Eligible Dwellings
To be eligible the property must meet the following requirements:
Be located within the City of Richfield.
Be a single-family dwelling, a townhouse unit, duplex or a condominium unit that is vacant or
owner occupied. No renters can be displaced at the time of purchase.
Be a conforming use as defined by the Richfield Zoning Ordinance.
Be in full compliance with the City of Richfield’s Point of Sale Program. (Ordinance Section
408.01). All corrections must be addressed according to the Point of Sale Program requirements,
either prior to sale or via escrow with the City of Richfield. More information found at:
http://www.richfieldmn.gov/pos.
Be free of lead-based paint hazards at the time of Closing. See page 11 for more detailed
information regarding lead-based paint hazards.
Applicant Outreach
The HRA will publicize and disseminate information to make known the availability of homeownership
assistance on a regular basis through a variety of media and other suitable means. The availability of
assistance will be communicated to other services providers, realtors, and lenders in the community and
advise them of the guidelines so that they can make proper referrals for the Program. Realtors and
lenders will be encouraged to provide additional services to eligible clients to ensure their successful
utilization of the program.
Applicant Pool
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The applicant pool for the Program shall consist of all those who have completed and returned to the
HRA a pre-application form, written verification from their lender of pre-approval, and who have
acknowledged that they will meet the eligibility requirements.
Funds will be available to the applicant pool on a first come, first serve basis. Eligible applicants will be
approved for funding when they or their lender notify the HRA of the applicant’s approved purchase
agreement and the full application packet is completed and returned. If funding is limited and more
than one applicant is at the purchasing stage, the HRA will provide funding to the applicant who qualifies
for the most preference points. For updated program information, including the status of annual funding
for the program, please refer to http://www.richfieldmn.gov/downpayment.
Preference points have been established to meet the goals of the HRA. Each preference category is
worth one (1) point. The maximum points any one household could receive are five (5) points.
Households with the highest point totals will be selected first. In the event of a tie, a drawing or lottery
will be held to rank the applicants within each of the preference categories.
Applicant is a current Richfield renter
Applicant with dependents under age 18
Applicant has lived in Richfield longer than 6 months prior to Closing
Head or co-head of household has primary, longer-term employment in Richfield
Applicant currently participates in Richfield’s Kids @ Home Program
Applicant has never owned a home (versus having owned a home over three years ago)
Approval from the applicant pool is tentative and conditional. Families selected for participation must
fulfill the Program obligations in a timely manner and must remain eligible to participate based on the
Program requirements and those of the lender through the time of Closing.
Lender Outreach
The HRA will solicit lender participation as needed. The HRA will review requests from lenders to be
approved as a participating lender of the First Time Homebuyer Program. The lenders must be
Minnesota Housing approved and exhibit a willingness to provide mortgage products to low and
moderate income households.
PART III: PROGRAM RULES
Lenders
All lenders must be approved by Minnesota Housing. Find a lender here: http://www.mnhousing.gov/.
Lenders and their representatives must also be willing to participate in the Richfield First Time
Homebuyer Program. Applicants should ask the lender if they have received the City’s First Time
Homebuyer Program Guidelines and if they are familiar with the process. It is the applicant’s
responsibility to make arrangements for obtaining pre-qualification or pre-indication of approval and for
making an application for a mortgage. A letter from the lender indicating the amount of the mortgage
for which the applicant pre-qualifies must be provided with each pre-application. The same lender
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must be used when the applicant goes for pre-approval of a mortgage prior to the purchase of a home,
so it is recommended that the applicant selects the lender carefully.
Lead Based Paint Hazard Requirements
All applicants purchasing a dwelling built prior to 1978 will be provided with a lead based paint brochure
and must sign a certification of receipt of the brochure.
The HRA will require an inspection of all dwellings built prior to 1978 for compliance with HUD’s lead-
based paint hazard regulations. This inspection is performed during the City of Richfield’s standard Point
of Sale Inspection. If LBP risks are found, stabilization of the defective paint, cleanup and clearance will
be required before funds are approved for assistance at closing. The presence of LBP risks should be
treated like any other defect found during an inspection and may be negotiated between buyer and
seller. Clearance will be required before the home can be safely occupied and will assure that there are
no remaining lead hazards. If the selling party is unwilling to address the LBP hazards, the property will
not be eligible for assistance. The applicant will need to find another house that is or will be made LBP
risk free in order to qualify for assistance.
Repayment of Assistance
Repayment of the down payment assistance loan shall occur upon the earliest of:
Sale or transfer
The property ceases for any reason to be the homebuyer’s principal place of residence.
Default on the mortgage with the HRA or any superior mortgage on the property.
Repayment of the loan shall be pro-rated, with the principal amount due reduced by 10% for each year
of the homeowner’s tenancy in their Richfield home, as established by the loan date on the filed
mortgage with the HRA.
AGE OF LOAN AMOUNT OF PRINCIPAL LOAN AMOUNT DUE
0 - 1 year 100 % of principal loan amount due
1 - 2 year 90% of principal loan amount due
2 - 3 years 80% of principal loan amount due
3 - 4 years 70% of principal loan amount due
4 - 5 years 60% of principal loan amount due
5 - 6 years 50% of principal loan amount due
6 - 7 years 40% of principal loan amount due
7 - 8 years 30% of principal loan amount due
8 - 9 years 20% of principal loan amount due
9 - 10 years 10% of principal loan amount due
10+ years 0% due, Loan Fully forgiven
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When a loan made by the HRA is paid in full or forgiven, a document satisfying the lien will be prepared
by the HRA, executed by the Executive Director or his or her delegate and delivered to the borrower for
recording. The borrower is responsible for the cost of recording the satisfaction. Contact a Richfield
Housing Specialist for more information about repayment of an HRA loan (612-861-9778).
Subordination of Mortgages
Richfield Housing and Redevelopment Authority (HRA) loan recipients requesting subordination of the
interest of the HRA in real property must submit a Subordination Request Form, the required supporting
documentation, and a processing fee. Forms are available on the City of Richfield website (www.
richfieldmn.gov) or by calling the Community Development Department at 612-861-9760. Requests will
not be considered until all documents and the processing fee have been received.
The following information must be submitted with the Subordination Request Form:
1. A typed letter dated and signed by the mortgagor, stating the reason for the requested
subordination and the use of any equity being removed as part of the loan transaction.
2. A copy of the current appraisal (dated within six months of application) or other
evidence of market value of the property that is acceptable to the HRA.
3. A copy of current title work (must indicate all debt against the property).
4. Explanation of remaining debts or liens with supporting documentation (i.e. most recent
mortgage bill).
5. Estimated closing costs/settlement statement, where applicable.
6. A copy of the mortgagor’s loan application.
7. Additional documentation may be required.
The HRA will subordinate its mortgage interest if all of the following conditions are met, to the extent
that they are applicable:
1. Closing costs are reasonable. Generally this shall mean that the sum of all discount
points, origination fees, and lender ancillary fees generally shall not exceed 3% of the
new first mortgage amount.
2. If the HRA believes that the payment terms of the refinance are within the financial
means of the borrower.
3. The total debt secured by the property, including the HRA lien and all superior
mortgages, does not exceed 80% of the documented market value of the property.
4. Any equity being removed beyond the cost of the loan transaction will be used to
improve the property. A typed letter, dated and signed by the applicant, must be
submitted stating the use of any equity being removed.
5. The overall value of superior debt must not be increased by more than 50%.
6. If no more than one subordination request has been approved by the HRA in the past
five years.
7. Property taxes, if not escrowed by the superior mortgage holder, must be current.
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The HRA will not subordinate to reverse mortgages. In most cases, interest-only loans or loans with
interest-only options, revolving lines of credits or debt consolidation will not be allowed unless the HRA
determines that an acceptable reason warrants this type of loan.
The HRA may approve other subordination requests not meeting the conditions above on a case-by-case
basis that are clearly in the best interests of the HRA, where the security of the HRA loan remains
acceptable, and denial of the request will cause or contribute to a documented hardship on the part of
the borrower.
The fee for a subordination request is established by the HRA. If the subordination request is denied,
the fee will be returned with a letter explaining the reason(s) for denial. An additional fee is required for
an appeal to the HRA and is non-refundable.
Subordination requests will be processed by HRA staff, who will submit the request with a
recommendation for action, to the Executive Director. The Executive Director has the authority to grant
a subordination request when, based on his or her discretion, the subordination is reasonable based on
the criteria set forth in this Policy. The Executive Director may request review and final decision by the
HRA. Requests for subordination should be submitted 30 days prior to the date the agreement to
subordinate is needed. Exceptions may be made on a case-by-case basis.
In cases where a subordination request does not meet the Policy, the Executive Director may grant an
administrative appeal under the following circumstances:
Loan-to-value (LTV) ratio is greater than 80%, but no greater than 85%; or
Equity being removed for anything other than property improvements does not exceed $5000;
or
The amount of financing superior to the HRA lien does not increase more than the cost of
settlement charges related to the refinancing; or
The overall superior debt increases more than 50% but the value of superior debt is unusually
low and/or sufficient equity protection exists
If an application is denied, the applicant may request an appeal in writing. Appeals will be submitted by
staff to the HRA at the next regularly scheduled meeting, provided the request is made at least 10 days
prior to that meeting. The HRA meets on the third Monday of each month.
Targeted Funding
At various times, the HRA may target Program funding for purchases in specific developments.
Applicants purchasing in those developments would receive Program funding prior to all other
applications.
Total Amount of Assistance
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The total amount of assistance received through the Richfield HRA for the First Time Homebuyer
Program cannot exceed $10,000.
Modification and Termination of Program
The HRA may modify or terminate the Program as it deems appropriate or as required by HUD. Once
the HRA has provided financial assistance and the mortgage executed, financial assistance shall not be
rescinded except as provide for in the executed HRA Mortgage, Loan Agreement, and Promissory Note.
APPENDIX A
DEFINITIONS
Acceptable Loans – Portfolio Products, Freddie Mac, Fannie Mae, FHA, VA and ARM’s that at a minimum
are at a fixed rate for the first seven years.
Applicant – an individual or household submitting an application for a loan.
Application – The form used to request assistance for the City’s First Time Homebuyer funds.
ARM or Adjustable Rate Mortgage – a mortgage that offers an initial rate that is fixed for a certain
number of years of repayment; the rate then adjusts every year thereafter for the remaining life of the
loan.
CDBG or Community Development Block Grant Program – an annual entitlement program provided to
the City of Richfield through the U. S. Department of Housing and Urban Development (HUD).
City – The City of Richfield.
Clearance – A lead based paint Certification that all lead issues have been remediated.
Closing – The consummation of the real estate transaction. The Closing includes the delivery of a deed,
financial adjustments the signing of notes, mortgages, and the disbursement of funds necessary to
complete the sale and loan transaction.
Closing Costs – Those costs required by the lender to be paid by the buyer for various fees, credit report
costs, insurance, etc., at the time of Closing on a property.
Consolidated and Annual Action Plans – HUD requires the City of Richfield to submit a 5 year
Consolidated Plan and an Annual Action Plan to guide housing, homelessness and Community
Development activities.
Conventional Mortgage – A type of residential mortgage loan, usually from a bank or savings and loan
association, with a fixed rate and term. It is repayable in fixed monthly payments over a period usually
30 – 40 years or less, secured by real property, and not insured by the Federal Housing Administration or
guaranteed by the Veterans Administration.
Down Payment – A type of payment made by a homebuyer indicating intention to purchase real estate
offered for sale and obtain financing from a bank or mortgage company.
15
Environmental Review – The process of verifying that a project meets federal, state, and local
environmental standards. The environmental review process is required for all HUD-assisted projects to
ensure that the proposed project does not negatively impact the surrounding environment and that the
property site itself will not have an adverse environmental or health effect on end users. HRA staff is
responsible for the completion of the environmental review.
Environmental Review Addendum – An addendum to the purchase agreement that states an
Environmental Review will be completed by the HRA prior to closing. The addendum must be a part of
the original purchase agreement in order to be valid.
Fannie Mae or Federal National Mortgage Association – A privately owned and operated corporation
that buys mortgages from such lenders as banks and savings and loans, packages and resells them on
the open market.
FHA or Federal Housing Administration – A Federal agency that administers many loan programs, loan
Guarantee programs, and Loan Insurance programs designed to make more housing available.
First Time Homebuyer – A household who has not owned a dwelling of any kind within the preceding
three years from the date of application or who has been displaced due to a divorce situation.
Gross Annual Income – The Gross annual Income of a Household for the purposes of this program is
defined for purposes of reporting under Internal Revenue Service Form 1040 for individual Federal
annual income tax purposes as per 24 CFR 570.3 Income (1)(iii).
Gross Assets – The current market value of the following minus existing indebtedness: (Typically, it does
not include 401K funds, pensions or other deferred compensation funds.)
1. Cash on hand
2. Cash in checking accounts
3. Cash in savings accounts, including accounts held in trust.
4. Investment securities (government bonds, municipal bonds)
5. Stocks
6. Certificate of deposits and annuities
Guidelines – The set of standards, criteria, and specifications to be used in administering the Program.
Household – All persons residing in one housing unit; which may include one or more families, a single
person, a married couple, or two or more unrelated persons.
Housing Counselor – A person who provides direct customer services primarily to groups, individuals,
households seeking information and assistance with housing issues.
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Housing Ratio - the percentage of income that goes toward housing costs including mortgage principal
and interest, mortgage insurance premium, hazard insurance premium, property taxes, and
homeowners association dues (when applicable).
HRA – The Housing and Redevelopment Authority in and for the City of Richfield, which administers the
City’s First Time Homebuyer Program.
HUD or U. S. Department of Housing and Urban Development – The principal federal agency
responsible for implementing certain federal housing and community development programs.
Income - The amount of money or its equivalent received during a period of time in exchange for labor
or services, from the sale of goods or property, or as profit from financial investments.
Lead Risk Assessment – A report that describes the health risk assessment, management process,
estimates of the costs of recovery, and summaries of possible defensive measures required per HUD
regulation CFR Part 35: Lead Based Paint Regulations.
Lender – Individual or firm that extends money to a borrower with the expectation of being repaid,
usually with interest.
Loan Estimate – Document disclosing the approximate closing costs a mortgage applicant will pay at or
before the mortgage settlement date.
Low Income Household– A household whose annual income does not exceed the low income limit as
established by HUD with adjustments for smaller and larger families.
Minnesota Housing – The Minnesota Housing Finance Agency; a Minnesota State agency that
administers a variety of first time homebuyer loan programs.
Moderate Income Household – A household whose annual income does not exceed 80 percent of the
median income for the area, as determine by HUD with adjustments for smaller and larger families.
Mortgage – The conveyance of an interest in real property given as security for the payment of a loan.
Principal Place of Residence – To occupy the home as the primary residence on a permanent basis.
Program – The City’s First Time Homebuyer Program.
Promissory Note – A written instrument containing a promise by the signer to pay and agreed amount.
Purchase Agreement – An agreement between buyer and seller of real property, setting forth the price,
and terms of the sale. Also known as a sales contract.
Reducing the Mortgage Principal Amount – A method of benefitting the buyer through the use of a
portion or all of the HRA provided financial assistance to lower the mortgage principle amount. In
effect, this assistance acts as a larger down payment and helps to reduce the monthly mortgage
17
payments. The available amount of assistance is up to 10% of the purchase price to a maximum of
$10,000. The buyer’s housing ratio must be between 25% and 35%.
Satisfaction of Mortgage – A document releasing a mortgage lien, indicating the borrower has paid the
debt in full.
Second Mortgage – A loan on a property that already has an existing mortgage (the first mortgage). The
second mortgage is subordinate to the first.
VA Loan – Department of Veterans Affairs, providing below-market financing with no down payment to
veterans of the U.S. Armed Services.
AGENDA SECTION:Consent Calendar
AGENDA ITEM #2.B.
S TAFF REPORT NO. 25
HOUSING AND RE DEVELOPMENT AUT HORIT Y
MEET ING
6/17/2019
RE P O RT P RE PA RE D B Y: J ulie Urban, Housing Manager
O THE R D E PA RTM E NT RE V IE W: N/A
E X E C UTIV E D IRE C TO R RE V IE W: J ulie Urban, A cting E xecutive D irector
6/12/2019
I T E M F O R C O UNC IL C O NS ID E RAT I O N:
Consider adoption of a resolution approving a Subordination Agreement and Estoppel Certificate
related to construction financing for the Cedar Point II townhomes.
E X E C UT IV E S UM M ARY:
On J uly 16, 2018, the Housing and Redevelopment Authority (HRA) approved a loan of $630,000 to NHH
Companies, LLC, now doing business as Cedar Point I nvestments LLC (Developer), to assist with the
acquisition of property in the Cedar Point I I redevelopment area (63rd to 65th Street and 16th Avenue
to Richfield Parkway). Under the terms of the Contract for Private Development (Contract), the
Developer may request that the H R A subordinate the Contract to the construction and/or permanent
financing loan. T he Developer plans to close on its construction financing in June. T he Lender is
requesting a subordination of the HRA loan at this time. In addition, the Lender is asking the H R A to
provide an Estoppel Certificate (Certificate) certifying the Developer is in compliance with the
Contract.
RE C O M M E ND E D AC T I O N:
By motion: Adopt a resolution approving a Subordination Agreement and Estoppel Certificate related
to construction financing for the townhome portion of the Cedar Point II redevelopment project.
B AS IS O F RE C O M M E ND AT I O N:
A.H IS TOR IC AL C ON T E X T
The HRA entered into a revised Contract to provide assistance to the townhome portion of the
redevelopment project on September 17, 2018.
On September 17, 2018, the HRA agreed to subordinate the Contract to a loan the Developer
received to finance acquisitions.
The Developer is accessing construction funds from its lender in order to begin construction on
the first eight townhomes.
The Lender is requiring that the HRA approve a subordination of the Development Agreement
prior to issuing the loan.
B.P OL IC IE S (resolutions, ordinances, regulations, statutes, etc):
The Lender is requiring that the HRA approve a Subordination Agreement and Certificate prior to
issuing a loan to Cedar Point I nvestments LLC.
C.C R IT IC AL T IMIN G IS S U E S:
The Developer is anticipating closing on their construction financing in J une. Prior to making the
loan, their Lender is requiring a Subordination Agreement and Certificate from the HRA.
Under the terms of the Contract, construction on the townhomes was to have begun by J une 1,
2019. Challenging winter weather conditions delayed the start of the townhomes. The Certificate
extends the deadline to December 31, 2019, although construction is likely to begin this summer.
D.F IN AN C IAL IMPAC T:
There is no financial impact to the HRA.
E.L E GAL C ON S ID E R AT ION:
The HRA retains its rights under the Contract.
The HRA Attorney will approve the final form to be executed by the HRA Chair and Executive
Director.
ALTE R N AT IV E R E C O MME N D ATIO N(S):
Deny the Subordination Agreement and Estoppel Certificate request.
P R IN C IPAL PAR TIE S E X P E C TE D AT ME E TIN G:
N/A
AT TAC H ME N T S:
D escription Type
Resolution Resolution L etter
S ubordination A greement B ackup Material
E stoppel C ertificate B ackup Material
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD, MINNESOTA
RESOLUTION NO. ______
RESOLUTION APPROVING SUBORDINATION AGREEMENT RELATING TO TOWNHOMES
DEVELOPMENT
WHEREAS, the City of Richfield, Minnesota (the “City”) and the Housing and Redevelopment
Authority in and for the City of Richfield, Minnesota (the “Authority”) have approved the creation of Tax
Increment Financing District No. 2018-1 (a housing district) (the “TIF District”) within the Richfield
Redevelopment Project in the City (the “Redevelopment Project”) and have adopted a tax increment
financing plan for the purpose of financing certain improvements within the Redevelopment Project; and
WHEREAS, the Authority entered into a Contract for Private Development, dated September 17,
2018 (the “Development Agreement”) with Cedar Point Investments LLC, a Minnesota limited liability
company (the “Developer”), pursuant to which the Developer agreed to acquire 15 parcels of property (the
“Development Property”) located within the TIF District, including four properties owned by the Authority
and conveyed to NHH Companies L.L.C, a Minnesota limited liability company and proposed to be
conveyed to the Developer, and construct on the Development Property a development which will include
approximately 80 owner-occupied affordable townhomes and necessary public infrastructure, including
streets and utilities (the “Minimum Improvements”), and the Authority agreed to reimburse the Developer for
a portion of land acquisition costs and certain site improvement costs related thereto with tax increment
generated from the Development Property; and
WHEREAS, to make the Minimum Improvements more economically feasible, Boundary Waters
Bank (the “Bank”) has agreed to make a loan in the amount of $2,070,000 to the Developer; and
WHEREAS, as a condition to providing the Loan, the Bank is requiring that the Authority
subordinate certain of the Authority’s rights under the Development Agreement, including but not limited to
the rights of the Authority with respect to the Development Property, to the rights of the Bank under the
documents to be executed in conjunction with the Loan, pursuant to the terms of a Subordination Agreement
(the “Subordination Agreement”) proposed to be entered into between the Authority, the Bank, and the
Developer, a copy of which has been presented before this Board of Commissioners of the Authority and
execute an estoppel certificate; and
NOW, THEREFORE, BE IT RESOLVED, by the Board of Commissioners of the Housing and
Redevelopment Authority in and for the City of Richfield, Minnesota as follows:
1. The Subordination Agreement and the estoppel certificate are hereby in all respects
authorized, approved, and confirmed, and the Chair and the Executive Director are hereby authorized and
directed to execute the Subordination Agreement and the estoppel certificate for and on behalf of the
Authority in substantially the form now on file with the Community Development Director but with such
modifications as shall be deemed necessary, desirable, or appropriate, the execution thereof to constitute
conclusive evidence of their approval of any and all modifications therein.
2. The Chair and the Executive Director are hereby authorized to execute and deliver all
documents deemed necessary to carry out the intentions of this resolution, the Subordination Agreement, and
the estoppel certificate.
2
Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota
this 17th day of June, 2019.
Mary Supple, Chair
ATTEST:
_________________________________________
Erin Vrieze Daniels, Secretary
SUBORDINATION AGREEMENT
THIS SUBORDINATION AGREEMENT (this “Agreement”) is made the __day of June,
2019, by and between Housing and Redevelopment Authority in and for the City of Richfield
(“HRA”),Boundary Waters Bank, a Minnesota banking corporation (“Bank”), and Cedar Point
Investments LLC, a Minnesota limited liability company (“Borrower”).
RECITALS:
A.Borrower desires to obtain and Bank is willing to make a construction loan in the
amount of $2,070,000 (the “Loan”)to Borrower under which repayment is to be secured by the
Property.
B.The HRA has established Tax Increment Financing District No. 2018-1 in order to
facilitate redevelopment of the Property and Borrower and HRA have entered into a Contract for
Private Development, dated September 17, 2018 (the “Development Contract”),a Right of Purchase
and Right of First Refusal, dated September 17, 2018 (the “Right of Purchase,” and collectively with
the Development Contract, the “Subordinated Agreements”)which provide the HRA with certain
rights to the Property including but not limited to,a right to re-enter and revest the Property and a
right to purchase the Property under certain circumstance.
C.As a condition precedent to Bank’s disbursement of proceeds under the Loan, Bank
requires the execution of this Agreement. Bank is disbursing the proceeds under the Loan in reliance
upon the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the sum of $1.00 and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
1.Subordination. Except as otherwise provided in this Agreement,the rights of the
HRA against the Borrower, or any of Borrower’s assets set forth in the Subordinated Agreements,
including, but not limited to any rights in the Property, are hereby subjected and subordinated, and
shall remain in all respects and for all purposes subject and subordinate, to the Loan and to the rights
and interest of Bank granted in the Mortgage. Specifically,the lien of that certain Construction
3228521_1 2
Mortgage, Assignment of Rents, Security Agreement and Fixture Financing Statement in favor of
Bank, as Mortgagee, in the original principal amount of $2,070,000.00,dated June ___, 2019, and
recorded on __________________ as Document No. ____________in the Office of the Recorder of
Hennepin County (the “Mortgage”),is hereby subordinated to any lien evidenced by the
Development Contract.Except as specifically agreed to herein, this Subordination Agreement shall
not limit the ability of the HRA to exercise its rights or remedies under the Development Contract.
2.Amendment. This Agreement may not be amended or modified in any manner other
than by an agreement signed by all of the parties hereto.
3.Successors and Assigns. This Agreement and each and every covenant, agreement
and other provisions hereof shall be binding upon the parties hereto and their successors and assigns.
As used here, the words “successors and assigns” shall include the he irs, administrators and
representatives of any natural person who is a party to this Agreement.
4.Choice of Law. This Agreement is made and executed under and in all respects is to
be governed and construed by the laws of the State of Minnesota.
5.Captions and Headings. The captions and headings of the various sections of this
Agreement are for convenience only and are not to be construed as confining or limiting in any way
the scope or intent of the provisions hereof. Whenever the context requires or permits, the singular
shall include the plural, the plural shall include the singular and the masculine, feminine and neuter
shall be freely interchangeable.
6.Notices. Any notices and other communications permitted or required by the
provisions of this Agreement (except for telephonic notices expressly permitted) shall be in writing
and shall be deemed to have been properly given or served by depositing the same with the United
States Postal Service, or any official successor thereto, designated as Certified Mail, Return Receipt
Requested, bearing adequate postage, or deposited with reputable private courier or overnight
delivery service, and addressed as hereinafter provided. Each such notice shall be effective upon
being deposited or delivered as aforesaid. The time period within which a response to any such
notice must be given, however, shall commence to run from the date of receipt of the notice by the
addressee thereof. Rejection or other refusal to accept or the inability to deliver because of changed
address of which no notice was given shall be deemed to be receipt of the notice sent. By giving to
the other party hereto at least ten (10) days’notice thereof, either party hereto shall have the right
from time to time to change its address and shall have the right to specify as its address any other
address within the United States of America.
Each notice to Bank shall be addressed as follows:
Boundary Waters Bank
Attn: Adam Traxler
2230 Eagle Creek Drive, Suite A
Woodbury, MN 55129
3228521_1 3
Each notice to Borrower shall be addressed as follows:
Cedar Point Investments LLC
7455 France Avenue South
Suite 351
Edina, Minnesota 55435
Attn: Adam Seraphine
Each notice to HRA shall be addressed as follows:
Housing and Redevelopment Authority
in and for the City of Richfield, Minnesota
6700 Portland Ave. South
Richfield, MN 55423
Attn: Community Development Director
14.Counterparts. This Agreement may be executed separately and independently in any number
of counterparts, each of which when so executed and delivered shall be deemed an original, but such
counterpart shall together constitute but one and the same instrument.
[This space intentionally left blank; signature pages follow.]
3228521_1 4
IN WITNESS WHEREOF, the parties hereto have each caused this Subordination Agreement
to be executed as of the date first above written.
BANK:BOUNDARY WATERS BANK
__________________________
By:Adam Traxler
Its:Vice President
STATE OF MINNESOTA )
)ss.
COUNTY OF )
This instrument was acknowledged before me on the ____day of June,2019,by Adam
Traxler, as Vice President of Boundary Waters Bank, a Minnesota banking corporation, on behalf of
the corporation.
_______________________________________
Notary Public
[Bank Signature Page to Subordination Agreement dated June ___, 2019, entered into by and
between the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota,
Boundary Waters Bank and Cedar Point Investments, LLC]
3228521_1 5
BORROWER: CEDAR POINT
INVESTMENTS LLC
____________________________
By:
Its:
STATE OF MINNESOTA )
) ss.
COUNTY OF )
This instrument was acknowledged before me on the ____ day of June, 2019,by
_____________________, the ___________________________ of Cedar Point Investments LLC, a
Minnesota limited liability company, on behalf of the company.
_______________________________________
Notary Public
[Borrower Signature Page to Subordination Agreement dated June ___, 2019, entered into by and
between the Housing and Redevelopment Authority in and for the City of Richfield,Minnesota,
Boundary Waters Bank and Cedar Point Investments, LLC]
3228521_1 6
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
RICHFIELD, MINNESOTA
By
Its Chair
By
Its Executive Director
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this ____ day of June, 2019, by Mary
B. Supple, the Chair of the Housing and Redevelopment Authority in and for the City of Richfield,
Minnesota, on behalf of the Authority.
Notary Public
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this ____ day of June, 2019, by John
Stark, the Executive Director of the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota, on behalf of the Authority.
Notary Public
[HRA Signature Page to Subordination Agreement dated June ___, 2019, entered into by and
between the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota,
Boundary Waters Bank and Cedar Point Investments, LLC]
3228521_1 7
This instrument was drafted by:
FAFINSKI MARK & JOHNSON, P.A. (NMB)
775 Prairie Center Drive, Suite 400
Eden Prairie, MN 55344
952-995-9500
3228521_1 8
EXHIBIT A
Parcel 1
Lot 7, Block 2, Iverson's Second Addition, Hennepin County, Minnesota.
Parcel 2
Lot 8, Block 2, Iverson's Second Addition, Hennepin County, Minnesota.
Abstract Property
6439 & 6445 16TH AVE S, Richfield, MN 55423
1
ESTOPPEL CERTIFICATE
Boundary Waters Bank
2230 Eagle Creek Drive, Suite A
Woodbury, MN 55129
Re:Contract for Private Development dated September 17, 2018 (the “Development
Agreement”)by and between Housing and Redevelopment Authority in and for the City
of Richfield (“HRA”)and Cedar Point Investments LLC, a Minnesota limited liability
company (“Borrower”).
Ladies and Gentlemen:
Reference is made to the captioned Development Agreement.Capitalized terms used and
not defined herein shall have the meanings ascribed to them in the Development Agreement.
Borrower desires to obtain and Boundary Waters Bank, a Minnesota banking corporation
(“Bank”), is willing to make a construction loan in the amount of $2,070,000 (the “Loan”) to
Borrower under which repayment is to be secured by the Property legally described on Exhibit A
attached hereto (the “Property”).In connection with the foregoing, the undersigned hereby
certifies to the Bank and its designees, successors and assigns,as of the date hereof, and agrees
as follows, recognizing that the Bank, and its designees, successors and assigns, will rely on the
information contained herein:
1.To the actual knowledge of the undersigned, the Development Agreement is in full force
and effect and has not been amended,modified, or supplemented in any way.
2.To the actual knowledge of the undersigned, there are no other agreements (oral or
written) between the parties to the Development Agreement relating to the Property
except for:
a.the Right of Purchase and Right of First Refusal Agreement dated September 21,
2018, recorded on October 8, 2018, in the Office of the County Recorder of
Hennepin County as Document Number A10599754 (the “Right of Purchase and
Refusal Agreement”);
b.the Right of Entry Agreement, dated January 15, 2018, between the HRA and the
Borrower; and
c.the Assumption Agreement, dated May 20, 2019, between NHH Companies,
L.L.C., the Borrower, and the HRA, recorded on June 4, 2019, in the Office of the
County Recorder of Hennepin County as Document Number A10663984.
The Development Agreement and the three agreements described above are referred
to herein as the “Agreements.”
3.To the actual knowledge of the undersigned, no sums are owed to any party to the
Agreements pursuant thereto other than as may be referenced in the Agreements.
2
4.To the actual knowledge of the undersigned, there are no pending or threatened disputes
or litigation between or among any of the parties to the Agreements or properties
benefited or burdened by the Agreements;
5.To the actual knowledge of the undersigned, all obligations of the parties to the
Agreements required to be performed to date have been fully performed; no uncured
default, event of default, or breach by a party has occurred and is continuing; no facts or
circumstances exist that with the passage of time, will or could constitute a default, event
of default, or breach of the Agreements; and no party has given notice alleging a default
to another party to the Agreements.To the actual knowledge of the undersigned, the
HRA has no claims, counterclaims, defenses or setoffs against any other party arising
under the Agreements or in connection with the Property.
6.Notwithstanding section 4.3 of the Agreements, Developer is not in default of the
Agreements for not commencing construction of the Minimum Improvements on or
before June 1, 2019.The HRA hereby extends the deadline for commencing construction
of the townhomes in the Development Agreement to December 31, 2019.
7.Pursuant to Section 7.1(b) of the Agreements, the HRA confirms receipt of evidence of
sufficient financing for the first phase of the townhomes.
[This space intentionally left blank; signature page follows]
3
IN WITNESS WHEREOF, the undersigned has executed this Estoppel Certificate as of
June ___, 2019.
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
RICHFIELD, MINNESOTA
By:Julie A Urban
Its:Acting Executive Director
STATE OF MINNESOTA )
)ss.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me on June ___, 2019, by Julie A
Urban, the Executive Director of the Housing and Redevelopment Authority in and for the City
of Richfield, Minnesota, on behalf of the Authority.
Notary Public
This instrument was drafted by:
FAFINSKI MARK & JOHNSON, P.A. (LAK)
775 Prairie Center Drive, Suite 400
Eden Prairie, MN 55344
952-995-9500
4
EXHIBIT A
LEGAL DESCRIPTION
Parcel 1:
Lot 7, Block 2, Iverson’s Second Addition, Hennepin County, Minnesota.
Parcel 2:
Lot 8, Block 2, Iverson’s Second Addition, Hennepin County, Minnesota.
Abstract Property
6439 & 6445 16TH AVE S, Richfield, MN 55423
AGENDA SECTION:PUBLIC HEARINGS
AGENDA ITEM #4.
S TAFF REPORT NO. 26
HOUSING AND RE DEVELOPMENT AUT HORIT Y
MEET ING
6/17/2019
RE P O RT P RE PA RE D B Y: K ate A itchison/C eleste McD ermott, Housing S pecialists
O THE R D E PA RTM E NT RE V IE W: N/A
E X E C UTIV E D IRE C TO R RE V IE W: J ohn S tark, E xecutive D irector
6/7/2019
I T E M F O R C O UNC IL C O NS ID E RAT I O N:
Public hearing and consider adoption of a resolution authorizing the sale of 6412 Bloomington Avenue
to Endres Custom Homes and the approval of a Contract for Private Development with Endres
Custom Homes for the construction of a single family home through the Richfield Rediscovered
Program.
E X E C UT IV E S UM M ARY:
Endres Custom Homes (the Builder) is applying to purchase the lot at 6412 Bloomington Avenue from the
Housing and Redevelopment Authority (HRA) for the construction of a single family home. The new home
would be a split level home with four bedrooms, three baths, a finished basement and a two-car attached
garage. The new home will be 2,145 finished square feet with a minimum end value of $358,900. The home
has been pre-sold to a buyer.
The Builder has previously built homes through the Richfield Rediscovered program and has worked
extensively with the HRA to ensure compliance with sound attenuation standards, design guidelines and
building requirements to find a proposal that is feasible for both the Richfield Rediscovered Program and the
Builder. I n order to make a new home viable on this lot, staff is recommending a discounted lot sale price to
account for additional costs related to required window upgrades and demolition costs.
RE C O M M E ND E D AC T I O N:
Conduct and close the public hearing and by motion:
1. Adopt a resolution authorizing the sale of 6412 Bloomington Avenue to Endres Custom Homes;
and
2. Authorize execution of a Contract for Private Development between the Housing and
Redevelopment Authority and Endres Custom Homes for the redevelopment of 6412
Bloomington Avenue.
B AS IS O F RE C O M M E ND AT I O N:
A.H IS TOR IC AL C ON T E X T
The HRA purchased 6412 Bloomington Avenue in 2019 for $115,000.
The existing substandard home was abated in 2019. The builder will be responsible for the
demolition of the existing home.
The vacant lot has been listed for $60,500.
B.P OL IC IE S (resolutions, ordinances, regulations, statutes, etc):
The proposed project meets the policy objectives of the Richfield Rediscovered Program:
Removes substandard, functionally obsolete housing and eliminates its blighting influence;
Provides new, higher valued housing; and
Alleviates shortage of housing choice for families.
The project also meets the Housing Design and Site Development Criteria, as defined in the
Richfield Rediscovered Guidelines:
The height and mass of the house is made compatible with other homes in the
neighborhood through the varied roof lines, presence of a roof eave at the first level, and
larger side setbacks (15 feet).
The dominance of the garage door is minimized by the use of windows and panels, the
front porch, living area above the garage, and a front setback greater than the neighboring
houses.
W hile the design provides slightly less window area due to the extraordinary sound
attenuation requirements, the plan provides a balanced and pleasing distribution of wall,
door and window areas from all views.
Site drainage will be accommodated on site.
I n April 2019, the HRA adopted the revised I nclusionary Housing Policy, which states: "W ith
regards to scattered-site single family housing development, at least 20% of the units newly
constructed or rehabilitated and converted to long-term affordability in any three-year period must
meet the proscribed affordability requirements."
Given formal approval of this project, the ratio of affordable scattered-site single family
housing development will be 43% for the 2017-2019 time period.
I n that time period, 12 market-rate new homes have been built, while 9 affordable
new construction/rehabilitated homes have been facilitated through the HRA.
C.C R IT IC AL T IMIN G IS S U E S:
The Contract for Private Development (Contract) requires the Builder to close on the property by
J uly 31, 2019, and to complete construction by October 31, 2019. All Richfield Rediscovered
contracts include a provision authorizing staff to grant an extension to these deadlines for a period
up to six months.
D.F IN AN C IAL IMPAC T:
The HRA acquired the 60-foot wide property and structure in 2019 for $115,000.
The appraised value of the vacant lot is $74,000.
Under the terms of the Contract, $60,500 will be due at closing.
A discount to the lot sale price is applied for sound attenuation costs and demolition costs.
Under the terms of the Contract for the property, the contracted minimum market value of the new
home will be $358,900.
Under the terms of the Contract, the Builder will also be required to submit a $10,000 cash
escrow.
E.L E GAL C ON S ID E R AT ION:
Notice of the public hearing was published in the Sun Current on J une 6, 2019.
Mailed notification is not required on this item; however, a courtesy notice was mailed to residents
within 350 feet of the property.
The HRA Attorney prepared the Contract for Private Development.
ALTE R N AT IV E R E C O MME N D ATIO N(S):
Do not approve the sale of the property and the Contract for Private Development
P R IN C IPAL PAR TIE S E X P E C TE D AT ME E TIN G:
Dustin Endres, Endres Custom Homes, I nc.
AT TAC H ME N T S:
D escription Type
Resolution Resolution L etter
C ontract for D evelopment C ontract/A greement
House plan B ackup Material
S ite plan C over Memo
HRA RESOLUTION NO.
RESOLUTION AUTHORIZING THE SALE OF REAL PROPERTY LOCATED AT
6412 BLOOMINGTON AVENUE TO ENDRES CUSTOM HOMES
WHEREAS, the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota (HRA) desires to develop certain real property pursuant to and in
furtherance of the Richfield Rediscovered Program adopted by the HRA, said real
property being described as:
Address: 6412 Bloomington Avenue
Legal: Lot 3, Block 6, Girard Parkview, Hennepin County, Minnesota
WHEREAS, the HRA is authorized to sell real property within its area of
operation after a public hearing; and
WHEREAS, the purchaser of the described property has been identified as
Endres Custom Homes, and
WHEREAS, a Contract for Private Development has been prepared, and the sale
price of 6412 Bloomington Avenue is $60,500 with performance security in the amount
of $10,000; and
WHEREAS, a public hearing has been held after proper public notice.
NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment
Authority in and for the City of Richfield, Minnesota:
1. A public hearing has been held and 6412 Bloomington Avenue is authorized
to be sold for $60,500 to Endres Custom Homes; and
2. The Chairperson and Executive Director are authorized to execute a Contract
for Private Development and other agreements as required to effectuate the
sale to the Builder.
Adopted by the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota this 17th day of June, 2019.
Mary Supple, Chair
ATTEST:
Erin Vrieze Daniels, Secretary
401253v8 CBR RC125-65
CONTRACT FOR PRIVATE DEVELOPMENT
Between
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD
and
Endres Custom Homes, Inc.
for property located at
6412 Bloomington Avenue South
This Instrument Drafted by:
The Housing and Redevelopment Authority
in and for the City of Richfield
6700 Portland Avenue South
Richfield, Minnesota 55423
Telephone: (612) 861-9760
401253v8 CBR RC125-65
1
CONTRACT FOR PRIVATE DEVELOPMENT
THIS AGREEMENT, made and entered into as of this ______ day of ________, 20___,
by and between the Housing and Redevelopment Authority in and for the City of Richfield, a
public body corporate and politic under the laws of the State of Minnesota, having its principal
office at 6700 Portland Avenue, Richfield, Minnesota (HRA) and Endres Custom Homes, Inc., a
Minnesota Corporation (Builder).
WITNESSETH:
WHEREAS, the City of Richfield (City) and the HRA have previously created and
established a Redevelopment Project (Project) pursuant to the authority granted in Minnesota
Statutes, Sections 469.001 through 469.047 (collectively, the Act); and
WHEREAS, pursuant to the Act, the City and the HRA have previously adopted a
redevelopment plan for the Project (Redevelopment Plan); and
WHEREAS, in order to achieve the objectives of the Redevelopment Plan and
particularly to make specified land in the Project available for development by private enterprise
for and in accordance with the Redevelopment Plan, the HRA has determined to provide
substantial aid and assistance to finance development costs in the Project; and
WHEREAS, the Builder has proposed a development as hereinafter defined within the
Project which the HRA has determined will promote and carry out the objectives for which the
Project has been undertaken, will assist in carrying out the obligations of the Redevelopment
Plan, will be in the vital best interests of the City and the health, 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.
NOW, THEREFORE, in consideration of the mutual covenants and obligation of the
HRA and the Builder, each party does hereby represent, covenant and agree with the other as
follows:
ARTICLE I.
DEFINITIONS, EXHIBITS, RULES OF INTERPRETATION
Section 1.1. Definitions. In this Agreement, the following terms have the meaning
given below unless the context clearly requires otherwise:
Building Plans. Detailed plans for the Improvements to be constructed on the Property,
as required by the local building official for issuance of a building permit.
401253v8 CBR RC125-65
2
Construction Plans. The construction plans approved by the HRA pursuant to Section
4.1 of this Agreement. The Construction Plans include a schedule for construction of the
Improvements, preliminary plans and schematics of the Improvements to be constructed, and a
landscaping plan.
Development. The Property and the Improvements to be constructed thereon according
to the Construction Plans approved by the HRA.
Event of Default. Event of Default has the meaning given such term in Section 8.1.
Guidelines. The Richfield Rediscovered Program Guidelines Lot Sale Program, revised
March 20, 2017, and attached as Exhibit B to this Agreement.
Homeowner. The individuals purchasing the Property from Builder and who will be
living in the home following purchase.
Improvements. Each and all of the structures and site improvements constructed on the
Property by the Builder, as specified in the Construction Plans to be approved by the HRA.
Minimum Market Value. $324,900, which is the minimum market value for the land
and Improvements as confirmed by the Hennepin County Assessor.
Mortgage. A mortgage obtained by the Builder from a third party lender in accordance
with Section 7.2 of this Agreement.
Property. The real property legally described as:
Lot 3, Block 6, Girard Parkview, Hennepin County, Minnesota
Located on land having a street address of:
6412 Bloomington Avenue South
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 Builder.
Section 1.2. Exhibits. The following Exhibits are attached to and by reference made a
part of this Agreement:
A. Form of Certificate of Completion
B. Program Guidelines – Lot Sale Program
C. Form of Quit Claim Deed
401253v8 CBR RC125-65
3
D. Well Disclosure
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 Builder. The Builder makes the following representations and
undertakings:
(a) The Builder 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 Builder has the necessary equity capital or has obtained commitments for
financing necessary for construction of the Improvements;
(c) The Builder will construct the Improvements in accordance with the terms of this
Agreement and all local, state and federal laws and regulations;
(d) The Builder will obtain, in a timely manner, all required permits, licenses and
approvals, and will meet, in a timely manner, the requirements of all local, state and federal laws
and regulations which must be obtained or met before the Improvements may be constructed;
(e) The plans for the Improvements have been prepared by a qualified draftsperson or
architect; and
(f) The Builder has read and understands the Guidelines and agrees to be bound by
them.
401253v8 CBR RC125-65
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 Builder and will cooperate with the efforts of
the Builder to secure the granting of any permit, license, or other approval required to allow the
construction of the Improvements.
ARTICLE III.
ACQUISITION OF PROPERTY; CONVEYANCE TO BUILDER
Section 3.1. Purchase of Property by Builder. The HRA agrees to sell the Property to
Builder and the Builder agrees to purchase the Property from the HRA in an “as-is” condition.
The sale of the Property is contingent upon the Builder providing the HRA with evidence
satisfactory to the HRA that Builder has entered into a binding legal commitment, in the form of
a Purchase Agreement for the resale of the Property to a Homeowner following completion of the
Improvements. The HRA agrees to convey the Property to the Builder by Quit Claim Deed in the
general form of Exhibit C. The HRA’s deed to the Builder will contain the right of reverter
required in Section 8.3. The purchase price for the Property, payable at Closing, will be $37,725
(“Purchase Price”).
Section 3.2. Title and Examination. As soon as reasonably possible after execution of
this Contract for Private Development by both parties,
(a) HRA shall surrender any abstract of title and a copy of any owner’s title insurance
policy for the property, if in HRA’s possession or control, to Builder or to Builder’s designated
title service provider; and
(b) Builder shall obtain the title evidence determined necessary or desirable by
Builder or Builder’s lender, including but not limited to title searches, title examinations,
abstracting, a title insurance commitment or an attorney’s title opinion, at Builder’s selection and
cost, and provide a copy to the HRA.
The Builder shall have 20 days from the date it receives such title evidence to raise any
objections to title it may have. Objections not made within such time will be deemed waived.
The HRA shall have 90 days from the date of such objection to effect a cure; provided, however,
that the HRA shall have no obligation to cure any objections, and may inform Builder of such.
The Builder may then elect to close notwithstanding the uncured objections or declare this
Agreement null and void, and the parties will thereby be released from any further obligation
hereunder.
401253v8 CBR RC125-65
5
Section 3.3. Taxes and Special Assessments. Real estate taxes and installments of
special assessments will be prorated between the HRA and Builder as of the date of closing.
Section 3.4. Soil Conditions and Hazardous Wastes. The Builder acknowledges that
the HRA makes no representations or warranties as to the conditions of the soils on the Property,
its fitness for the construction of improvements or any other purpose for which the Builder may
use the Property, or regarding the presence of hazardous wastes on the Property. The HRA will
allow reasonable access to the Property for the Builder to conduct such tests regarding soils
conditions and hazardous wastes as the Buyer may desire. Permission to enter the Property to
conduct such tests must be given in writing under reasonable terms and conditions established by
the HRA.
Section 3.5. Site Clearance. The HRA will be responsible for clearance of all buildings
as required to prepare the Property for development. All other site preparation is the
responsibility of Builder. Builder will comply with all of the provisions of the Guidelines
relating to tree protection, preservation and replacement.
Section 3.6. Other Preconditions to Closing. Closing may not take place until the
HRA is satisfied that the Project is in all respects in full compliance with the provisions of the
Guidelines contained in Exhibit B. It is anticipated that the Builder will involve the Homeowner
in the various activities required under the Guidelines so that the Homeowner will have an
opportunity to contribute suggestions concerning development of the Property.
Section 3.7. Closing. Closing must take place July 31, 2019, (“Closing Date”) or such
other date as may be agreed to by the Builder and HRA in writing. At Closing, the Builder will
provide the HRA with a a cash deposit for the escrow account established pursuant to Section
5.1, in addition to the Purchase Price.
Section 3.8. Closing Costs. The Builder will pay: (a) the closing fees charged by its title
insurance company or other closing agent, if any, utilized to close the transaction for
Builder; (b) title services chosen by Builder pursuant to Section 3.2 above, including the premium for
title insurance policy, if any, and (c) the recording fees for the Contract for Private Development and
the deed transferring title to the Builder. HRA will pay all other fees normally paid by sellers,
including (a) any transfer taxes, and (b) fees and charges related to the filing of any instrument
required to make title marketable. Each party shall pay its own attorney fees.
Section 3.9. Sewer and Water. HRA does warrant that city water and sewer is
available.
Section 3.10. ISTS Disclosure. HRA is not aware of any individual sewage treatment
system on the property. Buyer is responsible for all costs of removing any individual sewage
treatment system that may be discovered on the Property.
Section 3.11. Well Disclosure. HRA’s knowledge of wells on the Property is disclosed
in Exhibit D.
401253v8 CBR RC125-65
6
ARTICLE IV.
CONSTRUCTION OF IMPROVEMENTS
Section 4.1. Construction of Improvements. The Builder shall construct the
Improvements on the Property in accordance with the Guidelines and the Construction Plans,
shall cause the Improvements to meet or exceed the Minimum Market Value specified in Section
1.1, and shall maintain, preserve and keep the Improvements in good repair and condition. The
Builder shall provide his or her proposed construction plans to the HRA for review; if the
proposed construction plans are in conformity with this Agreement and the Guidelines, the HRA
will approve the Construction Plans following review and comment by the Homeowner.
Section 4.2. Construction Plans. No building permit will be issued by the City unless
the Building Plans are in conformity with the Guidelines, the Construction Plans, the Builder’s
Minimum Market Value, other requirements contained in this Agreement, and all local, state and
federal regulations. The Builder shall provide the HRA with a set of Building Plans to be used in
connection with any application for a building permit. The HRA shall, within 25 days of receipt
of the Building Plans review the same to determine whether the foregoing requirements have
been met. If the HRA determines such Building Plans to be deficient, it shall notify the Builder
in writing stating the deficiencies and the steps necessary for correction. Issuance of the building
permit by the City shall be a conclusive determination that the Building Plans have been
approved and shall satisfy the provisions of this Section 4.2.
Section 4.3. Schedule of Construction. Subject to Unavoidable Delays, construction of
the Improvements shall be completed prior to October 31, 2019 (“Construction Completion
Date”). All construction shall be in conformity with the approved Construction Plans and the
Guidelines. Periodically during construction the Builder 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 Builder will be
unable to complete construction of the Improvements in the time permitted by this Section 4.3, it
may notify the Builder and demand assurances from the Builder regarding the Builder’s
construction schedule. If such assurances are not forthcoming or are deemed by the HRA at its
sole discretion to be inadequate, the HRA may declare an Event of Default and may avail itself of
any of the remedies specified in Section 8.2 of this Agreement.
Section 4.4. Certificate of Completion. After notification by the Builder of completion
of construction of the Improvements, the HRA shall inspect the construction to determine
whether the Improvements have been completed in accordance with the Construction Plans and
the terms of this Agreement, including the date of the completion thereof. In the event that the
HRA is satisfied with the construction, and upon closing on the sale of the Property to the
Homeowner, the HRA shall furnish the Builder with a Certificate of Completion in the form
attached hereto as Exhibit A. Such certification by the HRA shall be a conclusive determination
of satisfaction and termination of the agreements and covenants in this Agreement. Issuance of
the Certificate of Completion shall also serve as a satisfaction of any obligation of Builder
401253v8 CBR RC125-65
7
secured by the escrow account established under Section 5.1, and the cash in the escrow account
will be released to the Builder. At the time a Certificate of Completion is issued, the HRA will
also provide Builder with a $5,000 cash rebate if Builder has obtained Green Community
Concepts certification through LEED for Homes, Minnesota GreenStar, Minnesota Green
Communities or Minnesota Green Path.
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 Builder with a
written statement, indicating in adequate detail in what respects the Builder has failed to
complete the Improvements in accordance with the provisions of this Agreement necessary, in
the opinion of the HRA, for the Builder to take or perform in order to obtain such certification.
Section 4.5. Failure to Construct. In the event that construction of the Improvements is
not completed as provided in Section 4.3 of this Agreement, an Event of Default shall be deemed
to have occurred, and the HRA may proceed with its remedies under Section 8.2.
ARTICLE V.
REDEVELOPMENT ASSISTANCE
Section 5.1. Establishment of Cash Escrow. Builder acknowledges that although it is
purchasing the Property at its fair market value as raw land, the HRA has incurred significant
costs in acquiring and preparing the Property for development by Builder. At Closing, Builder
will deliver to the HRA $10,000 to be placed in a non-interest bearing escrow account pursuant
to the Escrow Agreement, dated as of the date hereof, between Builder and HRA. The obligation
to pay the $10,000 to the HRA will be forgiven, and the cash in the escrow account will be
returned to Builder if: (i) the Builder receives a Certificate of Completion; and (ii) the Builder is
not otherwise in default of any of its obligations hereunder. If such have not occurred, an Event
of Default shall be deemed to have occurred and the HRA may exercise its remedies under
Section 8.2. In certain circumstances, after construction is complete, the Builder or Buyer may be
required to deposit another cash escrow with the planning department of the City for incomplete
improvements. In these cases, following the HRA’s release of the cash escrow, the cash escrow
will be transferred to the City’s planning department for such purpose. The terms of the escrow
will be set forth in an Escrow Agreement between the HRA and the Builder or Buyer.
ARTICLE VI.
FINANCING
Section 6.1. Financing. HRA acknowledges that Builder has submitted evidence of
financing for the Improvements in compliance with the provisions of Section 2.1(b) of this
Agreement. Builder must notify HRA immediately of any changes to or withdrawal of the
approved financing, HRA shall have 10 days to approve or disapprove changes in financing. If
the HRA rejects a change in the approved financing or if the approved financing is withdrawn,
the Builder shall have 30 days or such additional period of time as the Builder may reasonably
401253v8 CBR RC125-65
8
require from the date of the HRA’s notification to submit evidence of financing satisfactory to
the HRA. If the Builder fails to submit such evidence or fails to use due diligence in pursuing
financing, the HRA may terminate this Agreement and both parties shall be released from any
further obligation or liability hereunder. Closing shall not take place until Builder has provided
HRA with acceptable evidence of financing for construction of the Improvements.
Section 6.2. Copy of Notice of Default to Lender. Whenever the HRA shall deliver
any notice or demand to the Builder with respect to any Event of Default by the Builder 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 6.3. Subordination. In order to facilitate obtaining financing for the
construction of the Improvements by the Builder, the HRA may, in its sole and exclusive
discretion, agree to modify this Agreement in the manner and to the extent the HRA deems
reasonable, upon request by the financial institution and the Builder.
ARTICLE VII.
PROHIBITIONS AGAINST ASSIGNMENT AND TRANSFER
Section 7.1. Representation as to Redevelopment. The Builder represents and agrees
that its undertakings pursuant to the Agreement, are for the purpose of development of the
Property and not for speculation in land holding. The Builder further recognizes that, in view of
the importance of the Development to the general welfare of Richfield and the substantial
financing and other public aids that have been made available by the HRA for the purpose of
making the Development possible, the qualification and identity of the Builder are of particular
concern to the HRA. The Builder 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 Builder for the faithful performance of all
undertakings and covenants agreed by the Builder 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 Builder represents and
agrees as follows:
(a) Except as specifically allowed by this section, Builder has not made or created,
and, prior to the issuance of the Certificate of Completion, Builder will not make or create, or
suffer to be made or created, any total or partial sale, assignment, conveyance, or any trust in
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.
(b) This provision shall not be deemed as preventing the Builder from entering into a
Purchase Agreement for the sale of the Property to a Homeowner.
401253v8 CBR RC125-65
9
(c) This provision does not prohibit conveyances that are only by way of security for,
and only for the purpose of obtaining financing necessary to enable the Builder 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. Any
Mortgage obtained by the Builder must be disclosed to the HRA, and must be subordinate to this
Agreement. The Builder must provide the HRA with an address for the holder of the Mortgage
for purposes of providing notices as may be required by this Agreement.
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 Builder to pay when due the payments required to be paid or
secured under any provision of this Agreement;
(b) Failure by the Builder to observe and substantially perform any covenant,
condition, obligation or agreement on its part to be observed or performed hereunder, including
the time for such performance;
(c) If the Builder 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 Builder, on a petition in bankruptcy filed against it, be adjudicated as
bankrupt, or a court of competent jurisdiction shall enter an order or decree appointing, without
the consent of the Builder, a receiver of the Builder or of the whole or substantially all of its
property, or approve a petition filed against the Builder seeking reorganization or arrangement of
the Builder 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 Development is in default under any Mortgage and has not entered into a
work-out agreement with the holder of the Mortgage.
Section 8.2. Remedies on Default. Whenever any Event of Default occurs, the HRA
may, in addition to any other remedies or rights given the HRA under this Agreement, take any
one or more of the following actions following written notice by the HRA to the Builder as
provided in Section 9.3 of this Agreement:
401253v8 CBR RC125-65
10
(a) Suspend its performance under this Agreement until it receives assurances from the
Builder, deemed reasonably adequate by the HRA, that the Builder will cure its default and
continue its performance under this Agreement;
(b) Cancel or rescind this Agreement;
(c) Exercise its right under Section 8.3;
(d) Withdraw all funds in the escrow account established in Section 5.1;
(e) Withhold the Certificate of Completion; or
(f) Take whatever action at law or in equity may appear necessary or desirable to the
HRA to enforce performance and observance of any obligation, agreement, or covenant of the
Builder 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 interest provided in this Agreement for the protection of the holders of a Mortgage; and
provided further that should any holder of a Mortgage succeed by foreclosure of the Mortgage or
deed in lieu thereof to the Builder’s interest in the Property, it shall, notwithstanding the
foregoing, be obligated to perform the obligations of the Builder under this Agreement to the
extent that the same have not therefore been performed by the Builder.
Section 8.3. Revesting Interest in HRA Upon Happening of Event of Default
Subsequent to Conveyance of Property to Builder. In the event that subsequent to the closing
or the sale of the Property to the Builder and prior to the issuance of the Certificate of
Completion:
(a) The Builder fails to begin construction of the Improvements in conformity with
this Agreement, and such failure is not due to Unavoidable Delays;
(b) The Builder, after commencement of the construction of the Improvements,
defaults in or violates obligations with respect to the construction of the Improvements, including
the nature and the date for the completion thereof, or abandons or substantially suspends
construction work, and such act or actions is not due to Unavoidable Delays;
(c) The Builder or successor in interest fails to pay real estate taxes or assessments on
the Property or any part thereof when due, or places thereon any encumbrance or lien
unauthorized by this Agreement, or suffers any levy or attachment to be made, or any supplier’s
or mechanic’s lien, or any other unauthorized encumbrance or lien to attach;
(d) There is, in violation of Article VII of this Agreement, any transfer of the Property
or any part thereof; or
(e) The Builder fails to comply with any of its covenants under this Agreement,
401253v8 CBR RC125-65
11
then the HRA shall have the right upon 30 days’ written notice to Builder and the Builder’s
failure to cure within such 30 days period, to re-enter and take possession of the Property and to
terminate and revest in the HRA the interest of the Builder in the Property; provided, however,
that such revestiture of title shall be subject to the lien of any prior encumbrance permitted under
this Agreement, or any right of a Homeowner pursuant to a valid Purchase Agreement authorized
by this Agreement.
Section 8.4. 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 Builder to exercise any remedy reserved to it, it shall not be necessary to give notice,
other than such notice as may be required in this Article VIII.
Section 8.5. No Additional Waiver Implied by One Waiver. In the event of the
occurrence of any Event of Default by either party, which Event of Default is thereafter waived
by the other party, such waiver shall be limited to the particular Event of Default so waived and
shall not be deemed to waive any other concurrent, previous or subsequent Event of Default.
ARTICLE IX.
ADDITIONAL PROVISIONS
Section 9.1. Conflict of Interests; Representatives Not Individually Liable. No HRA
officer who is authorized to take part in any manner in making this Agreement in his or her
official capacity shall voluntarily have a personal financial interest in this Agreement or benefit
financially there from. No member, official, or employee of the HRA shall be personally liable
to the Builder, or any successor in interest, for any Event of Default by the HRA or for any
amount which may become due to the Builder 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 Builder as though fully
set forth herein.
Section 9.3. Notices and Demands. Except as otherwise expressly provided in this
Agreement, a notice, demand or other communication under this Agreement by either party to the
other shall be sufficiently given or delivered if it is sent by mail, postage prepared, return receipt
requested or delivered personally:
401253v8 CBR RC125-65
12
(a) As to the HRA:
Richfield HRA
Executive Director
6700 Portland Avenue South
Richfield, MN 55423
(b) As to the Builder:
Dustin Endres
Endres Custom Homes, Inc.
15561 Dunberry Way
Apple Valley, MN 55124
or at such other address with respect to either such party as that party may, from time to time,
designate in writing and forward to the other as provided in this Section 9.3.
Section 9.4. Counterparts. This Agreement may be simultaneously executed in any
number of counterparts, all of which shall constitute one and the same instrument.
Section 9.5. Extensions. Any extension to the Closing Date and/or extension to
Construction Completion Date that exceeds 6 months from the date agreed to in Section 3.7 and 4.3,
respectively, must be approved by the HRA Board. HRA staff is authorized to extend the Closing
Date to a date less than 6 months from the Closing Date agreed to in Section 3.7 and extend the
Construction Completion Date to a date less than 6 months from the Construction Completion Date
agreed to in Section 4.3.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
as of the day and year first above written.
[signature pages follow]
401253v8 CBR RC125-65
13
Signature Page for HRA
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
RICHFIELD, MINNESOTA
By _______________________________________
Its Chairperson
By _______________________________________
Its Executive Director
__________________________________________
STATE OF MINNESOTA )
) SS
COUNTY OF ______________ )
The foregoing instrument was acknowledged before me this __________ day of
____________________, 20_____, by , the Chairperson of the Housing and
Redevelopment Authority in and for the City of Richfield, Minnesota, a public body corporate
and politic under the laws of Minnesota, on behalf of the authority.
________________________________________________
Notary Public
STATE OF MINNESOTA )
) SS
COUNTY OF ______________ )
The foregoing instrument was acknowledged before me this __________ day of
____________________, 20_____, by , the Executive Director of the Housing
and Redevelopment Authority in and for the City of Richfield, Minnesota, a public body
corporate and politic under the laws of Minnesota, on behalf of the authority.
________________________________________________
Notary Public
401253v8 CBR RC125-65
14
Signature Page for Builder
Builder
By______________________________________
Its______________________________________
STATE OF MINNESOTA )
) SS
COUNTY OF ______________ )
The foregoing instrument was acknowledged before me this __________ day of
____________________, 20_____, by __________________________________________, the
______________________ of _______________________________________________, a
_________________________ under the laws of _____________________, on behalf of the
_____________________.
________________________________________________
Notary Public
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401253v8 CBR RC125-65
EXHIBIT A
FORM OF CERTIFICATE OF COMPLETION
The undersigned hereby certifies that ____________________________, has fully and
completely complied with its obligations under that document entitled “Contract for Private
Development”, between the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota and ________________________ dated ___________________________,
filed ___________________________ as Document No. ____________________ (the
“Contract”) with respect to the construction of the approved construction plans at
________________________, legally described as _____________________________ and is
released and forever discharged from its obligations under such Contract.
DATED: ___________________
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
RICHFIELD
By: __________________________________
Its: Executive Director
STATE OF MINNESOTA )
) SS
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this ____ day of
_______________, 20__, by _________________________ the Executive Director of the
Housing and Redevelopment Authority in and for the City of Richfield, a public body corporate
and politic under the laws of the State of Minnesota on behalf of the public body corporate and
politic.
________________________________
Notary Public
This instrument was drafted by:
Kennedy & Graven, Chartered
470 U.S. Bank Plaza
200 South Sixth Street
Minneapolis, MN 55402
401253v8 CBR RC125-65
B-1
EXHIBIT B
PROGRAM GUIDELINES – LOT SALE PROGRAM
RICHFIELD REDISCOVERED
PROGRAM GUIDELINES
LOT SALE PROGRAM
REVISED: March 20, 2017
B-2
401253v8 CBR RC125-65
PROGRAM OBJECTIVES ............................................................................................................................ 3
DEFINITIONS................................................................................................................................................ 3
PROGRAM BASICS ..................................................................................................................................... 3
APPLICATION REQUIREMENTS ................................................................................................................ 4
ADDITIONAL REQUIREMENTS .................................................................................................................. 5
HOUSE DESIGN AND SITE DEVELOPMENT REQUIREMENTS .............................................................. 5
New House Standards ............................................................................................................................ 6
Site Standards ......................................................................................................................................... 6
Construction Requirements .................................................................................................................. 6
General Standards .................................................................................................................................. 7
Green Community Concepts ................................................................................................................. 8
CITY REVIEW PROCEDURE ....................................................................................................................... 8
LOT SALE TO BUILDER/BUYER ................................................................................................................ 9
PROGRAM MARKETING ............................................................................................................................. 9
DATA PRIVACY .......................................................................................................................................... 10
B-3
401253v8 CBR RC125-65
This document has been developed as a guidance tool for program administration. It should not be interpreted as
constituting any contractual agreement or liability by the City or Housing and Redevelopment Authority (HRA). The
HRA may modify or divert from the guidelines where it deems appropriate.
I. Program Objectives
1. To remove substandard, functionally obsolete housing on scattered sites throughout the City and
replace with new, higher-valued housing.
2. To eliminate the blighting influence of substandard housing, thus improving residential neighborhoods.
3. To alleviate the shortage of housing choices for families.
4. To facilitate the construction of larger three- to four-bedroom, owner-occupied homes designed for
families.
5. To facilitate the construction of multi-unit, owner-occupied homes designed to expand family
opportunities or to serve elderly residents.
These objectives will be achieved through the sale of lots by the Housing and Redevelopment Authority to
Builder/Buyer teams for the development of newly constructed homes.
II. Definitions
Applicant: An individual who submits an application for a Richfield Rediscovered lot. The Applicant may be a
Builder or the end Buyer. If the Applicant is a Builder, an end Buyer should be identified. If the Applicant is the
Buyer, the Applicant must submit a signed contract between the Builder and the Buyer to build a home on the lot
identified in the application.
Buyer: An individual(s) who will build, own and occupy a new housing unit in Richfield.
The Buyer will occupy the property and not offer it for rent. The Buyer may not also function as the Builder on a
Richfield Rediscovered project. The Buyer and Builder must be unrelated separate legal entities. A speculative
project by a Buyer may be considered if all other program requirements can be met. However, neither the Buyer, the
Buyer’s Builder or Builder’s subcontractors, or the Builder’s realty agents may occupy or purchase the property.
Buyers, unless licensed in the trade specified, may not put any sweat equity into the construction of the foundation,
wall/roof framing, shingling, exterior work, electrical/plumbing/HVAC systems or interior carpentry.
A Buyer, and all members of his/her household, is limited to building a home through the program no more than
once every seven years.
Builder: Licensed Contractor who has signed a contract with the Buyer to build a home on the lot identified in the
application.
Contract for Private Development: A contract between the HRA and the Builder or Buyer that establishes the
conditions under which the lot will be sold and the proposed house will be developed.
Green Community Concepts Plan: A written plan indicating how the proposed development will incorporate green
building features and concepts. Priority will be given to projects that incorporate green building features.
HRA: Housing and Redevelopment Authority in and for the City of Richfield.
Lot List: A listing of available lots for sale. Information regarding the lot location, size and sale price is provided.
III. Program Basics
1. HRA publishes a list of available vacant lots for purchase including sale price and development criteria.
B-4
401253v8 CBR RC125-65
2. Builder/Buyer team proposes a plan for a lot consistent with development criteria and program
requirements and makes an offer to purchase.
3. HRA may issue a Request for Proposals for a specific lot(s) with a specific submittal deadline. HRA
staff review all Proposals submitted by the deadline for consistency with development criteria and
program requirements. The Proposal that best meets the criteria and requirements is selected to develop
the lot.
4. HRA approves lot sale.
5. Lot is sold to Builder or Buyer.
6. Builder constructs new home.
7. Projects must be completed within one year of HRA approval of the project.
IV. Application Requirements
The following must be submitted for application to the program:
1. $550 application fee
An application fee must be paid at the time of application. This fee is non-refundable and is not
part of the lot price.
2. Application Form
3. Floor plans
The layout of all levels, including basement and unfinished space, must be provided.
4. Elevations
Elevations of all four sides of the house, including view of garage shall be provided. Colored
renderings may also be required.
5. Site plan
The site plan shall indicate the location of the new house, walkways and garage.
6. Landscaping plan
A landscaping plan must indicate the location and type of trees, shrubbery, flowers and
landscaping materials (e.g. rocks, mulch) and any existing trees to be preserved.
7. Detail of construction materials to be used on the project.
8. Green Community Concepts Plan
The plan should indicate what Green Community Concepts will be incorporated into the project.
9. Construction timeline
Construction must be completed with one year of the purchase of the property.
10. Signed contract with Builder
11. Purchase agreement
If the Builder plans to purchase the lot, the application must include a valid purchase agreement
between the Buyer and the Builder for the lot to be developed.
12. Financial capability statement
A statement from a financial institution indicating willingness to provide sufficient construction
capital to complete the project must be provided.
13. Builder References
a. Five previous customers
b. Three major suppliers, one being the construction supplier
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c. Building inspectors from two cities where the Builder has constructed new housing within the
past three years
14. Proof of Builder’s Comprehensive General Liability with Property Damage Protection.
15. Proof of sufficient worker’s compensation insurance coverage by the Builder.
16. Written warranty program
To be provided to the Buyer, which guarantees at a minimum, warranted repairs as required by
Minnesota State Statute.
V. Additional Program Requirements
1. The Applicant is expected to meet with an architectural/design consultant prior to submitting an application.
A two-hour consultation is available through the HRA at a cost of $25 to the applicant. See the City’s
website (www.cityofrichfield.org) for more information. This requirement may be waived if the applicant is
using an architect for the project.
2. The site will be sold to the Builder or Buyer at the fair market value as appears on the Lot List. The HRA
will not accept offers for less than the established sale price.
3. A Contract for Private Development is signed by the HRA and the Builder or the Buyer. The Contract is a
standard form which includes conditions for acquisition and development of the property. The Contract
will establish a minimum required end-value for the property based on construction estimates provided by
the applicant. The Builder or Buyer will be expected to agree to the terms of the Contract before the
application can be scheduled on the HRA agenda.
4. The lot can be sold to either the Builder or the Buyer. If the lot is sold to the Builder, the Builder will pay
cash for the lot at closing and submit a Letter of Credit or cash escrow for $10,000. The Letter of Credit
must be from a financial institution incorporated in the Twin Cities metropolitan area. The cash escrow will
be held in a non-interest bearing account. The Letter of Credit or cash escrow will be released once the
construction and landscape work are completed and a final Certificate of Occupancy is issued.
5. If the lot is sold to the Builder and the Builder fails to complete construction as approved by the HRA, the
Letter of Credit or cash escrow may be drawn upon by the HRA. In addition, the Contract for Private
Development will contain a reverter provision, which will enable the HRA to reclaim ownership of the
property in the event of a default in the Contract. In the event that the Builder fails to complete
construction, the HRA may exercise its rights under the reverter provision, as well as draw upon the Letter
of Credit or cash escrow.
6. If the lot is sold to the Buyer, the Buyer will pay cash for the lot at closing and a $10,000 mortgage in favor
of the HRA will be filed on the property. The mortgage will be in first position. The HRA may consider
subordinating its interest in appropriate cases.
7. If the lot is sold to the Buyer and the Buyer fails to complete construction as approved by the HRA, the
HRA may exercise its rights provided in the mortgage.
8. A Buyer, and all members of his/her household, is limited to purchasing no more than one lot every seven
years.
VI. House Design and Site Development Requirements
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The development of all sites shall meet the development criteria listed below, as reviewed and approved by the HRA.
To maximize the development of a given lot, the HRA reserves the right to explore all development options without
obligating the HRA to support any specific proposal, idea or solicitation.
Housing design is a critical element of the program. Siding materials, exterior façade presentation, roof, window,
siding and building line variability, finished landscape, interior space function and use are all important issues of
design to the HRA. The design requirements were created to ensure that the homes built on the HRA-sold lots blend
in with the surrounding neighborhood and respond to the specific concerns of the HRA.
All new houses built under the Richfield Rediscovered Program must meet the requirements of the City’s Zoning
Code and additional criteria, as listed in this document.
A. New House Standards
1. New dwelling must be owner-occupied.
2. Three finished bedrooms are required, at a minimum.
3. Two finished bathrooms are required, at a minimum.
4. Two-car garage is required, at a minimum.
5. A full basement is required, unless the selected design results in a split-level or a garden-level type of
basement. In the case of an “accessible” house, a basement may be omitted if it would otherwise prohibit
accessible design elements.
B. Site Standards
1. After construction, the site must be fully landscaped, including plantings around the foundation. The entire
grounds shall be landscaped and be aesthetically pleasing in all seasons. Land forms and plant materials
shall be used to define the site and blend neatly with adjoining properties. Specific lot line blending
requirements may be required, as appropriate, for specific sites.
At a minimum, the applicant must meet the “Landscaping and Screening Requirements” in the City’s
Zoning Code under Section 544.03, Subd. 4, General landscaping requirements and Subd. 5, Residential
sites. The code is available on the City’s website: http://www.ci.richfield.mn.us
To the greatest extent possible, existing trees should be preserved. Any trees removed must be replaced
(they do not have to be the same species or in the same location) and should be labeled on the required
landscape plan.
2. Utility meters shall be screened from street view and locations must be specified on plans.
3. Site drainage should be accommodated on the site so that water is directed away from the new home and
the neighboring properties. Neighboring properties must not be disturbed by the creation of drainage
swales. Specific storm water management requirements may be required, as appropriate, including the
addition of gutters or on-site management for specific sites. Construction and the finished structure must
not have a detrimental impact on storm water drainage patterns in the neighborhood.
4. All air conditioning units must be located in the rear yard of the house, or as approved by the HRA.
C. Construction Requirements
1. Existing trees identified on the landscape plan as being preserved, must be protected during construction.
A tree wrap with board reinforcements shall be used on trees directly adjacent to active grading and
construction areas. Damaged or destroyed trees must be replaced.
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2. The construction site, neighboring properties and adjacent public streets shall be kept free of construction
debris at all times.
3. No construction workers, construction equipment or construction material shall encroach upon neighboring
properties.
4. The property shall have a new sanitary service line installed to the City sanitary sewer main consisting of
schedule 40 PVC or equivalent. If there is an existing 6" sewer stub at the property line, it must be lined
with 4" schedule 40 PVC or equivalent to the City’s sanitary main, and it must include a "donut" at the end
with cement.
The line must be televised after installation to ensure the following:
1. There are no obstructions in the line.
2. The PVC liner is not protruding into the City’s sanitary sewer main line.
D. General Standards
1. The value of the new home must meet or exceed the minimum value specified in the Contract for Private
Redevelopment.
2. All homes in the Richfield Rediscovered Program must be stick-built or high-quality modular, new
construction.
3. Exterior materials (siding, soffit, doors and windows) should be low-maintenance and durable. Brick,
aluminum, vinyl and fiber cement siding are preferred. Natural cedar lap is acceptable if properly stained or
painted. Hardboard panels or hardboard lap siding are prohibited. Roof valleys must have metal valleys
and not be woven.
4. Unit height and mass of the new house shall be compatible with the scale of the surrounding homes in the
neighborhood.
5. Plans must present a balanced and pleasing distribution of wall, door and window areas from all views.
6. The dominance of the garage door must be minimized through placement, architectural detail, door design
and utilization and design of windows. Garages, where the garage door faces the street, shall not be located
closer to the front lot line than the foremost facade of the principal building facing the front property line.
Garage sidewalls that face the street should appear to contain habitable space. This can be accomplished by
incorporating windows and other design elements into the garage wall that are in character with the
remainder of the dwelling. For lots that have alley access, the garage should be oriented to access the alley.
7. All building plans must have been prepared in consultation with an architect or qualified draftsperson. All
requirements by the Building Inspections Division must be met.
8. All Richfield Rediscovered houses must meet or exceed Minnesota Energy Code requirements.
9. All new homes shall be built to provide high quality sound insulation. Recommendations for sound
insulation measures may be provided on a site-by-site basis. All construction must conform to sound
attenuation building standards as required by Zoning Ordinance Section 541.19 for properties located
within the 2007 60-62 DNL Contour and 2007 63 or greater DNL contours.
9. If a variance is required to construct the proposed development, the HRA may, at its sole discretion, choose
to reject the application.
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10. If the HRA accepts an application that needs a variance(s), sale of the property will be contingent upon the
applicant obtaining the necessary variance(s). The Applicant is responsible for applying for the variance(s)
at its own expense. The HRA, as owner of the property, will, however, cooperate with the application.
E. Green Community Concepts
Priority will be given to projects incorporating the green community concepts listed below. Any concepts
the applicant would like considered during the application process should be explained in a written plan
submitted with the application. A $5,000 rebate will be provided to the Applicant for projects that obtain
certification through LEED for Homes, Minnesota GreenStar or Minnesota Green Communities.
1. Protect and conserve water and soil. To reduce water consumption, consider the use of water-conserving
appliances, fixtures, and landscaping. Steps should be taken to minimize the loss of soil and sediment
during construction and occupancy to reduce storm-water sediment and air pollution.
2. Minimize energy consumption. Reduce energy consumption by taking advantage of natural heating, cooling
and day lighting, and by using energy-efficient appliances, equipment and lighting.
3. Enhance indoor environmental quality. Use non-toxic materials, ventilation and exhaust systems, and
moisture control products and systems.
4. Use environmentally-preferable materials and resources. Use locally-produced, salvaged and/or
manufactured materials, products with recycled content or from renewable sources, recyclable or reusable
materials, and low-VOC-emitting materials.
5. Reduce waste. Reduce and manage wastes generated during the construction process and operation of
buildings. If demolition occurs, sort and recycle leftover materials and debris.
VII. City Review Procedure
1. Applicant reviews proposed project with HRA staff before plans are finalized.
2. Applicant submits application, plans, and application fee at least 45 days prior to the HRA meeting.
3. An application is considered to be received when delivered personally to HRA staff in a pre-arranged
meeting. If more than one application is submitted for a lot within five-working days, all applications will
be reviewed, and the application that best meets the program guidelines will be selected. The application fee
will be returned to the Applicant whose proposal was not selected.Following this five-day period, the lot
will be considered reserved by the selected application and no additional applications will be accepted for
the proposed lot while the application is being processed.
4. If an application is determined to be incomplete, the applicant will have 30 days to submit a complete
application. If a complete application is not received within 30 days, the application will be rejected and
the lot will be made available for new applications.
5. HRA staff review application to ensure conformance with House Design and Site Development
Requirements.
6. HRA staff may reject or accept an application at its sole discretion.
7. HRA staff may choose to issue a Request for Proposals (RFP) for a lot. In this case, Staff issues an RFP,
giving a specific time period within which proposals may be submitted. HRA staff review all proposals for
consistency with development criteria and program requirements. The proposal that best meets the criteria
and requirements is selected to develop the lot. The applicant will have 30 days to submit a complete
application. If a complete application is not received within 30 days, the application will be rejected. Staff
may elect to award the lot to another submitted proposal or solicit additional proposals.
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8. The Builder or Buyer executes a Contract for Private Redevelopment.
9. An application is determined to be complete at least three weeks prior to the HRA meeting.
10. HRA staff publishes a legal notice of the public hearing and prepares a report and recommendation for the
HRA.
11. HRA reviews application, conducts a public hearing, and takes action at the HRA meeting.
12. If approved, the Contract for Private Redevelopment is executed by the HRA.
VIII. Lot Sale to Builder or Buyer
1. Upon approval of the application by the HRA, a closing will be scheduled between the HRA and the
Builder or Buyer.
2. The HRA will prepare all statements, affidavits, documents, and general release forms required for closing.
3. The Builder applies for a building permit prior to closing. The Builder is responsible for acquiring the
necessary building permits with the City of Richfield Building Inspections Division. If changes to the plans
are required by the Inspections Division, the applicant must notify HRA staff.
4. The Applicant provides evidence to HRA staff that all requirements to proceed with construction, as
determined in the Contract for Private Redevelopment, have been met.
5. The HRA conveys the property to the Builder or Buyer by Quit Claim Deed. The site will be sold to the
Builder or Buyer at the fair market value as appears on the Lot List.
6. At closing with the Builder, the Builder provides a Letter of Credit or cash escrow for $10,000 to the HRA.
7. At closing with the Buyer, the Buyer signs a mortgage and promissory note for $10,000 in favor of the
HRA.
8. Upon completion of the project, the Letter of Credit or cash escrow is released to the Builder or the Buyer’s
mortgage is released. A Certificate of Completion is executed by the HRA, releasing the obligations of the
Contract for Private Redevelopment.
IX. Program Marketing
Richfield Rediscovered program marketing is entirely at the discretion of the HRA. It may include the following:
1. Buyer Solicitation. The HRA may market the program to potential Buyers through promotional articles,
direct mail, the Internet, or other methods as deemed appropriate. Buyers may be any financially capable
individual or household, including first-time buyers, move-up buyers or empty-nesters.
2. Public Promotion.
a. The HRA will periodically provide information about the program through articles in city
publications, on the City’s web site, on the Community Cable channel, or via press releases to
promote community awareness.
b. A public open house may be held to provide an opportunity for residents and other interested
parties to collectively view the finished homes. The Parade of Homes Fall Showcase and Spring
Preview may also accomplish this.
c. Photos will be taken of finished homes and may be used to promote the program.
A program information package will be mailed to all interested participants. The information packet may include the
following:
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401253v8 CBR RC125-65
1. Lot List
2. Richfield Rediscovered Lot Sale Procedural Guidelines
3. Application Form
4. Sample Contract for Private Redevelopment
X. Data Privacy
The HRA is subject to Minnesota Statutes Chapter 13 (the “Minnesota Government Data Practices Act”). Under
the Minnesota Government Data Practices Act, the names and addresses of applicants for or recipients of
assistance under this program and the amount of assistance received under this program are public data. All other
financial information submitted to the HRA for purposes of the program application is considered private data.
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EXHIBIT C
QUIT CLAIM DEED
STATE DEED TAX DUE HEREON: $_______
Date: ____________________
FOR VALUABLE CONSIDERATION, Housing and Redevelopment Authority in and for the
City of Richfield, a public body corporate and politic under the laws of the State of Minnesota,
Grantor, hereby conveys and quit claims to _____________________, a _______________
under the laws of the State of ____________, Grantee, real property in Hennepin County,
Minnesota, described as follows:
, according to the map or plat thereof on file or of record in the office of the Hennepin County
Recorder.
This deed is subject to that certain Contract for Private Development between Grantor and
Grantee, dated ___, 20__ (the “Contract”), recorded ___, 20__, in the office of the Hennepin
County Recorder/Registrar of Titles as Document No. ______________. The Contract
provides that the Grantee’s rights and interest in the real property described above are subject to the
Grantor’s right to re-enter and revest in Grantor title to the Property under conditions specified
therein, including but not limited to termination of the Grantor’s right to re-enter and revest upon
issuance of a Certificate of Completion as defined in the Agreement.
(if more space is needed, continue on back)
together with all hereditaments and appurtenances.
The Seller certifies that the seller does not know of any wells on the described real property.
A well disclosure certificate accompanies this document.
I am familiar with the property described in this instrument and I certify that the status and
number of wells on the described real property have not changed since the last previously
filed well disclosure certificate.
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD
Affix Deed Tax Stamp Here
By
Its Chairperson
By
Its Executive Director
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NOTARIAL STAMP OR SEAL (OR OTHER TITLE OR RAK)
NOTARIAL STAMP OR SEAL (OR OTHER TITLE OR RAK)
STATE OF MINNESOTA
} ss.
COUNTY OF HENNEPIN
The foregoing was acknowledged before me this ____ day of _______, 20___, by
_____________, the Chairperson of the Housing and Redevelopment Authority in and for the
City of Richfield, a public body corporate and politic under the laws of Minnesota, on behalf of
the corporation, Grantor.
____________________________________
SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT
STATE OF MINNESOTA
} ss.
COUNTY OF HENNEPIN
The foregoing was acknowledged before me this ____________ day of _______, 20__,
by _____________, the Executive Director, of Housing and Redevelopment Authority in and for
the City of Richfield, a public body corporate and politic under the laws of the State of
Minnesota, on behalf of the corporation, Grantor.
____________________________________
SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT
Check here if part or all of the land is Registered (Torrens)
Tax Statements for the real property described in this
instrument should be sent to (include name and
address of Grantee):
This instrument drafted by:
Kennedy & Graven, Chartered
470 U.S. Bank Plaza
200 South Sixth Street
Minneapolis, MN 55402
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EXHIBIT D
WELL DISCLOSURE
The Seller certifies that the seller does not know of any wells on the described real property.
X A well disclosure certificate will be filed on or before closing evidencing the sealing of the well
described on the attached Well Sealing Record.”. [form attached]
The status and number of wells on the described real property have not changed since the last
previously filed well disclosure certificate.
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