12-21-09 agenda packetCITY OF RICHFIELD, MINNESOTA
MONDAY, DECEMBER 21, 2009
REGULAR HOUSING AND REDEVELOPMENT AUTHORITY MEETING
RICHFIELD CITY HALL COUNCIL CHAMBERS
6700 PORTLAND AVENUE
7:00 P.M.
AGENDA
Call to order
Roll call
1. Approval of minutes of Regular HRA Meeting of November 16, 2009
Notes:
2. HRA approval of agenda
3. Consent Calendar contains several separate items which are acted upon by the HRA
in one motion. Once the Consent Calendar has been approved, the individual items
and recommended actions have also been approved. No further HRA action is
necessary. However, any HRA Commissioner may request that an item be removed
from the Consent Calendar and placed on the regular agenda for HRA discussion and
action. All items listed on the Consent Calendar are recommended for approval.
A. Consideration of approval of development agreement with Greater Metropolitan
Housing Corporation for acquisition, rehabilitation and sate of houses through
Neighborhood Stabilization Program S.R. No. 49
B. Consideration of approval of First Look Program Acquisition Agreement and
Access and Indemnification Agreement with Twin Cities Community Land Bank
LLC for acquisition of foreclosed property S.R. No. 50
Notes:
4. Consideration of request for subordination of HRA Transformation Home loan at 201
72nd Street West
Staff Report No. 51
Notes:
5. Consideration of contract for private redevelopment between HRA and Charles
Zawislak for redevelopment of 6320 Morgan Avenue under Richfield Rediscovered
Program
Staff Report No. 52
Notes:
6. Executive Director report
7. Claims and payroll
Adjournment
Auxiliary aids for individuals with disabilities are available upon request. Requests must
be made at least 96 hours in advance to the City Clerk at 612-861-9738.
J
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING MINUTES
Richfield, Minnesota
Regular Meeting
November 16, 2009
CALL TO ORDER
The meeting was called to order by Chair Sandahl at 7:00 p.m.
ROLL CALL
HRA Members
Present: Sue Sandahl, Chair; Joan Helmberger; Doris Rubenstein; David Gepner;
and Steven Quam.
Staff Present: John Stark, Acting Executive Director; Karen Barton, Assistant Community
Development Director; and Nancy Gibbs, City Clerk.
Item #1 HRA APPROVAL OF MINUTES
Commissioner Rubenstein stated she went to visit one of the projects that Michael
Swenson of Michaels Development had suggested to look at during the October 19 Meeting while
discussing redeveloping of the Wood Lake Plaza Shopping Center. Commissioner Rubenstein
visited one of Mr. Swenson's projects in Roseville to look at the quality of the project. She stated
that the property is very nice; she picked up some information to share with others.
M/Rubenstein, S/Quam to approve the minutes of (1) Regular HRA Meeting of October 19,
2009.
Motion carried 5-0.
Item #2 HRA APPROVAL OF AGENDA
M/Gepner, S/Rubenstein to approve the agenda.
HRA Meeting
Motion carried 5-0.
-2- November 16, 2009
Item #3 CONSENT CALENDAR
A. Consideration of approval of housing services agreement with West Hennepin Affordable
Housing Land Trust for sale of houses through Neighborhood Stabilization Program S.R.
No. 46
B. Consideration of approval of property management agreement with Home Leasing &
Management, Inc. for management of HRA-owned residential rental properties S.R. No. 47
M/Gepner, S/Rubenstein to approve the Consent Calendar.
Motion carried 5-0.
Item #4 PUBLIC HEARING REGARDING RESOLUTION AUTHORIZING SALE OF 6704
PLEASANT AVENUE TO HABITAT FOR HUMANITY, INC. FOR DEVELOPMENT
OF SINGLE FAMILY HOME S.R. NO. 48
Assistant Community Development Director Barton presented Staff Report No. 48.
Commissioner Rubenstein asked why there is such a discrepancy in the numbers.
Assistant Community Development Director Barton responded with comparisons to other
similar properties.
Chad Dipman, Land Acquisition Manager for Habitat for Humanity, thanked the HRA.
M/Gepner, S/Rubenstein to close public hearing.
Motion carried 5-0.
M/Sandahl, S/Quam that the following resolution be adopted and that it be made part of
these minutes:
HRA RESOLUTION NO. 1060
RESOLUTION AUTHORIZING SALE OF REAL PROPERTY LOCATED
AT 6704 PLEASANT AVENUE TO HABITAT FOR HUMANITY, INC. IN
ACCORDANCE WITH A DEVELOPMENT AGREEMENT
Motion carried 5-0. This resolution appears as HRA Resolution No. 1060.
Item #5 EXECUTIVE DIRECTOR REPORT
HRA Meeting -3- November 16, 2009
Acting Executive Director Stark explained, currently there are no items for the December 21
Meeting. This may mean that the meeting will be cancelled but he will keep all commissioners
informed. ,
Commissioner Quam stated that Tom Rublein of the Planning Commission suggested that
the HRA and Planning Commission meet to discuss how programs interrelate.
Acting Executive Director Stark stated that in January the Planning Commission sets their
study session schedule for the year. This might be a good time for the Planning Commission to
decide on a date to meet and staff will bring a date to the HRA.
Item #6 CLAIMS AND PAYROLL
M/Gepner, S/Quam that the following claims and payrolls be approved:
U.S. Bank 11-16-2009
Section 8 Checks: 118091 - 118223
HRA Checks: 30716 - 30759
TOTAL
Motion carried 5-0.
ADJOURNMENT
The meeting was adjourned by unanimous consent at 7:21 p.m.
Date Approved:
Nancy Gibbs
City Clerk
$ 174, 042.27
$ 95,239.13
$269,281.40
Suzanne M. Sandahl
Chair
John Stark
Acting Executive Director
AGENDA ITEM # 3A
REPORT # 49
J STAFF REPORT
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING
DECEMBER 21, 2009
REPORT PREPARED BY:
REPORT PRESENTER:
DEPARTMENT DIRECTOR REVIEW
REVIEWED BY EXECUTIVE DIRECTOR:
JULIE URBAN/MICHELLE LEWIS, HOUSING
SPECIALIST
NAME, TITLE
JOHN STARK, COMMUNITY DEVELOPMENT
DIRECTOR
NAME, TITLE
ITEM FOR HRA CONSIDERATION:
Approve Development Agreement with the Greater Metropolitan Housing Corporation for the
acquisition, rehabilitation and sale of houses through the Neighborhood Stabilization Pro ram.
I. RECOMMENDED ACTION:
By Motion: Approve and authorize execution (subject to minor
revisions by legal counsel) of a NSP I Developer Agreement with the
Greater Metropolitan Housing Corporation for the acquisition,
rehabilitation and sale of houses through the Neighborhood
Stabilization Program.
II. BACKGROUND
On October 19, 2009 the Housing and Redevelopment Authority (HRA) approved
and authorized execution of an Acquisition and Services Agreement with Greater
Metropolitan Housing Corporation (GMHC) to purchase, rehabilitate, and resell
houses through the Neighborhood Stabilization Program (NSP). Since that time the
entities involved in acquisition process have changed and the previously approved
Acquisition and Services Agreement needs to be a Developer Agreement.
Under the proposed Development Agreement GMHC would perform the same
functions as previously approved, specifically to purchase, rehabilitate, and resell
122109 GMHC NSP contract.doc
properties using NSP funds awarded to the HRA, working with HRA staff and the
newly formed Twin Cities Community Land Bank (TCCLB). (For additional
information on TCCLB see the staff report regarding approving an agreement with
TCCLB.)
III. BASIS OF RECOMMENDATION
A. POLICY
• The HRA previously approved and authorized execution of an
Acquisition and Services Agreement with GMHC. The NSP
Developer Agreement changes GMHC's status from a Subrecipient to
a Developer, but still maintains their role in expending NSP funds.
• The changes to the Agreement reflect changes in the process to
access foreclosed properties before investors. The Agreement still
allows the HRA early access to vacant and foreclosed properties.
B. CRITICAL ISSUES
• The Developer Agreement identifies GMHC to meet NSP
requirements.
• NSP funds must be committed by September 20, 2010. The
Agreement with GMHC provides an efficient means to use the NSP
funds by the deadline.
• GMHC piloted the NCST First Look Program, through which they have
an early opportunity to purchase foreclosed properties. Since the
Agreement was approved, the process of transferring foreclosed
properties through NCST changed. Previously GMHC was the
approved intermediary between NCST and buyers. Currently the
newly formed Twin Cities Community Land Bank (TCCLB) facilitates
the sale of properties from NCST to the HRA or developers approved
by the HRA. TCCLB is assuming the intermediary role that GMHC
previously held.
C. FINANCIAL
• The HRA was awarded a total of $1,041,541 in Federal NSP funds;
currently $750,000 is allocated for the acquisition, rehabilitation, and
re-sale of foreclosed properties through the Minnesota Housing
Finance Agency (MHFA).
• NSP funds will cover the transaction fees to acquire property through
the TCCLB and will cover the Developer's Fee charged by GMHC for
its services.
• NSP funds must be under contract prior to September 20, 2010.
Failure to expend the NSP funds by September 20, 2010 will result in
forfeiture of the funds.
D. LEGAL
• Legal counsel has reviewed the revised Acquisition and Services
Agreement.
IV. ALTERNATIVE RECOMMENDATION(S~
• Do not approve the Developer Agreement.
V. ATTACHMENTS
• NSP I Developer Agreement
VI. PRINCIPAL PARTIES EXPECTED AT MEETING
• N/A
Vii- ~ DRAFT
NSP I DEVELOPER AGREEMENT
(Greater Metropolitan Housing Corporation)
THIS AGREEMENT, made and entered into as of this of , 2009
("Effective Date"), by and between the Housing and Redevelopment Authority in and for the
City of Richfield ("City"), a body corporate and politic under the laws of the State of Minnesota,
having its principal office at 6700 Portland Avenue, Richfield, Minnesota ("HRA") and the
Greater Metropolitan Housing Corporation, a nonprofit corporation under the laws of
Minnesota, having its principal office at 15 South Fifth Street, Suite 710, Minneapolis,
Minnesota 55402 ("GMHC").
RECITALS
A. Title III of Division B of the Housing and Economic Recovery Act of 2008 (Pub. L 110-
289, 1222 Stat. 2654 enacted July 30, 2009), as amended by the American Recovery and
Reinvestment Act of 2009, H.R. 1 (the "Act") makes available to qualified entities certain
qualified grant funds termed Neighborhood Stabilization Program funds ("NSP I Funds")
under the FY08 CDBG Neighborhood Stabilization Program ("NSP I").
B. Hennepin County ("County") received a grant of NSP I Funds directly from the United
States Department of Housing and Urban Development ("HUD") and was a recipient of
funds the State of Minnesota Housing Finance Agency ("MHFA") received directly from
HUD, both under the Act.
C. HRA applied for and obtained NSP I Funds from County in an amount not to exceed
$1,041,541.00 ("NSP I Award") within certain approved areas of the City ("NSP Eligible
Area"), as set forth in HRA's agreement with County for the NSP I Award dated March
20, 2009 ("Subrecipient Agreement").
D. HRA has awarded and/or will award NSP I Award to certain developers ("NSP I
Developers") under its Foreclosure Recovery Program for the purposes of (i) purchasing
and rehabilitating properties that have been foreclosed upon or abandoned ("Category B
Properties"), which constitute an eligible use of NSP I Funds pursuant to § 2301(c)(3)(B)
of the Act ("Eligible Use Category B"), and (ii) redeveloping demolished or vacant
properties ("Category E Properties"), which constitute an eligible use of NSP I Funds
pursuant to § 2301(c)(3)(E) of the Act ("Eligible Use Category E").
E. Under NSP I, properties must have been foreclosed upon to qualify for NSP I assistance
under the Act and must have been abandoned or foreclosed upon to qualify for NSP I
assistance under the Act. Category B Properties and Category E Properties shall be
individually referred to as "Eligible Property" and collectively referred to as "Eligible
Properties".
F. HRA has approved the use of $750,000.00 for the purchase, rehabilitation, and resale of
four Eligible Use Category B properties within the NSP Eligible Area; however, HRA
reserves the right to approve additional funds for the purchase, rehabilitation, and resale
of additional Eligible Properties under the terms of this Agreement.
361662v3 MJM RC125-296
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G. On April 23, 2009, HUD issued a document titled "Guidance on NSP I-Eligible
Acquisition and Rehabilitation Alctivities" that clarifies the use of intermediaries for
acquisitions under NSP I (the "HU Guidance").
H. Pursuant to the First Look Program Acquisition Agreement between HRA and Twin
Cities Community Land Bank LL,C, a Minnesota nonprofit limited liability company
("TCCLB"), dated December 21, 2009,:.HRA and TCCLB will be working with the
National Community Stabilizatio Trust ("NCST") and participating sellers under a
program called "First Look" ("Fir t Look Program") which allows TCCLB to purchase
Eligible Properties prior to such ligible Properties being placed on the open market
using standardized transaction formats and pricing models to facilitate a significant
purchase price adjustment for the benefit of TCCLB.
I. HRA desires GMHC to purchase, II ehabilitate, and resell up to four Eligible Properties at
the direction of HRA and GM Chas agreed to do so pursuant to the terms and
conditions of this Agreement, MH ' A, County, HUD, and the Act.
J. From time to time, HRA and GMHC may identify an Eligible Property through means
other than the First Look Programl This Agreement is intended to be applicable to those
acquisitions, rehabilitations, and red ales as well.
K. This Agreement is intended to sati fy the requirements of 24 CFR 570.202 and the HUD
Guidance so that Eligible Properties acquired by GMHC retain their eligibility for NSP
assistance.
L. As required by paragraph five of the Subrecipient Agreement, the County provided its
prior consent to this Agreement.
M. Capitalized terms used and not defined in this Agreement shall have the meaning set forth
in that certain NSP I Notice published in the Federal Register on October 6, 2008, as
amended by those certain Revisions and Technical Corrections issued June 11, 2009.
AGREEMENT
1. Scope of Work. ~'
A. Developer. HRA hereby Designates GMHC as an NSP I Developer to purchase,
rehabilitate, and resell Eligible Propety s at the direction of HRA through the First Look
Program and in accordance with the terms and conditions of this Agreement.
B. Reports. GMHC shall provide HRA on a monthly basis with a report of its
activities under the First Look Program.
C. Criteria. After consultati n with HRA, GMHC shall provide TCCLB with its
criteria for Eligible Properties that it wou~d like to acquire under the First Look Program. Such
criteria shall include location, quality, price, and level of needed repairs.
361662v3 MJM RC125-296 2
~R 3
D. Compliance with Required Prog ams. To the extent required by federal, state,
and local law and regulation, GMHC agrees to comply with the program requirements of:
1) Hennepin Housing Consortium HOME Investment Partnerships
Program Construction and Rehabilitation Standards (as of October
28, 2008);
2) 2008 national Green Communities Criteria (mandatory items only)
as modified by the 2009-2010 Minnesota Overlay to the Green
Communities Criteria and as further defined in Section 4.07 of
MHFA's Neighborhood Stabilization Program Procedural Manual
(as of October 22, 2009) ("Procedural Manual"); and
3) Procedural Manual
as attached and hereto incorporated into this Agreement as Exhibit B, and
4) Hennepin County Affirmative Action Policy and Commissioners'
Policies Against Discrimination;
5) -Equal opportunity and discrimination provisions of 24 CFR Part
570 and all applicable State and Federal laws, rules, and
regulations and as set forth in Section 3.02 of the Procedural
Manual;
6) Section 504 of the Rehabilitation Act of 1973, as amended;
7) Lead based paint notification, inspection, testing and abatement
procedures established in 24 CFR Part 35 as referenced in 24 CFR
570.608, including but not limited to the Lead Disclosure Rule and
HUD's Lead Safe Housing Rule as set forth in Section 3.06 of the
Procedural Manual;
8) Fair housing requirements of section 104(b) and section 109 of
Title I of the Housing and Community Development Act of 1974,
as amended, including Title VI of the Civil Rights Act of 1964, the
Fair Housing Act, and other applicable fair housing laws and as set
forth in Section 3.02 of the Procedural Manual; and
9) the City's NSP Affirmative Fair Housing Marketing Plan.
GMHC further agrees to provide HRA with a timely certification that the program requirements
listed in this Section have been met as required by law and this Agreement.
2. Term. This Agreement is effective as of the Effective Date and until December 31, 2010.
3. NSP Eligible Area. The map attached to this Agreement as Exhibit A identifies the areas
determined by the MHFA to be the City's areas of greatest need. To be eligible for NSP I
Funds, Eligible Properties must be located within these areas of greatest need.
4. Timing. Any properties acquired by GMHC prior to the Effective Date of this
Agreement and any properties acquired by GMHC without the prior consent of HRA are not
eligible for NSP I Funds.
361662v3 MJM RC 125-296
~~-a
5. URA. GMHC shall comply with applicable acquisition and relocation requirements in
the Uniform Relocation Assistance and Real Property Acquisition Act ("URA") as required
under 24 CFR 570.606(a) and HUD implementing regulations at 49 CFR Part 24, including,
without limitation, the voluntary acquisition provisions at 49 CFR 24.101(b)(1). Among other
things, URA and its implementing regulations require documentation of the delivery of an
informational notice in substantially the orm attached to this Agreement as Exhibit C (HUD
Guideform: "NSP Voluntary Acquisitio of Foreclosed Property") to each property owner.
GMHC will acquire only unoccupied prop)I ~sties and must certify that its acquisition did not cause
tenant displacement (as .described in UR1A). Further, with respect to any property foreclosed
after February 17, 2009, GMHC must c¢operate with TCCLB's efforts to `obtain certification
from the foreclosing lender that the foreclosing lender complied with the tenant protections in the
American Recovery and Reinvestment Act of 2009 (Public Law 111-5) and the Protecting
Tenants at Foreclosure Act of 2009 with the form attached to this Agreement as Exhibit D
("PTFA Certification"). If GMHC acquires an Eligible Property at the direction of HRA through
any means other than the First Look Program and that Eligible Property was foreclosed after
February 17, 2009, then GMHC must obtain certification from the foreclosing lender that the
foreclosing lender complied with the tenant protections in the American Recovery and
Reinvestment Act of 2009 (Public Law 1 i 1-5) and the Protecting Tenants at Foreclosure Act of
2009 using a form substantially similar to 'the form attached to this Agreement as Exhibit D.
6. Purchase Discount. GMHC will iobtain aURA-compliant appraisal (49 CFR 24.103)
through Hennepin County dated within sixty (60) days before the final offer date of any
applicable Eligible Property and obtain a discount from the Current Market Appraised Value for
each Eligible Property of at least one p~rcent (1 %). If the anticipated value of the Eligible
Property is $25,000 or less and the acqui ltion is voluntary, then review of available data by a
person qualified to make the valuation ma~ be substituted for an appraisal.
7. Environmental Review. Prior to a commitment of NSP I Funds or "choice-limiting
action" as described in the environmental', regulations at 24 CFR Part 58, GMHC and HRA will
undertake the appropriate environmental review procedures and documentation as determined,
requested, or required by the County.
8. Acquisition, Rehabilitation, and Resale Provisions. It is the intent of the parties that
Eligible Properties acquired pursuant to this Agreement will retain their Foreclosed status
including through any subsequent sales or transfers from TCCLB to GMHC as an NSP I
Developer and through any non-NCST sales or transfers to GMHC. GMHC and HRA further
agree as follows:
(a) Purpose -NSP Eligible Use Category B.
(b) Eligible Area -depicted in Exhibit A.
(c) Sale Price - At the closing for each Eligible Property, HRA will pay GMHC its
cost of acquisition plus a ififteen hundred dollar ($1500.00) transaction fee per
Eligible Property.
361662v3 MJM RC125-296 4,
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(d) Procedures -For any acquisition pursuant to the terms of this Agreement, HRA
and GMHC will follow the acquisition, rehabilitation, and resale procedures
attached to this Agreement as Exhibit E ("Procedures")~. For First Look Program
acquisitions, GMHC will also follow the procedures attached to this Agreement as
Exhibit F ("TCCLB Acquisition Process") wherein the term "Developer" shall
mean GMHC.
(e) Purchase Agreement - GMHC will enter into a purchase agreement in
substantially the form attached to this Agreement as Exhibit G ("Form Purchase
Agreement") for each Eligible Property or group of Eligible Properties that HRA,
from time to time, requests GMHC to acquire under this Agreement.
(f) Title -GMHC shall acquire title from TCCLB through the First Look Program or
from any other eligible seller pursuant to the terms of this Agreement; and GMHC
shall remain in title during the rehabilitation and resale periods and until the sale
of an Eligible Property to a qualifying end buyer.
(g) Developers Fee - HRA will pay GMHC eight percent (8%) of GMHC's total
development cost of each Eligible Property. The development cost shall include
costs for the following: acquisition, construction or rehabilitation, contingency,
marketing and realtor services, and carrying. Upon the resale of each Eligible
Property to an end buyer, GMHC will provide HRA with an accounting.
Thereafter HRA will pay GMHC said fee. HRA will not unreasonably withhold
said fee.
(h) Resale -GMHC will market and resell each Eligible Property acquired pursuant
to this Agreement to an NSP income-eligible individual in compliance with
applicable federal, state, and local laws and regulations, including but not limited
to the continuing affordability requirements stated in the NSP I Notice, 24 CFR
92.242, 24 CFR 92.254. Pursuant to the HUD Guidance, the sales price of
properties sold to NSP income-eligible individuals cannot exceed total costs
(acquisition, rehabilitation, and development costs).
9. Documentation. GMHC must maintain the following records and reports relating to
Eligible Properties acquired pursuant to this Agreement: appraisal, NSP informational notice
offer letter, PTFA Certification, NSP I Developer Access and Indemnification Agreement,
environmental reports, purchase agreements, settlement statements, and deed document
number/filing information per property. GMHC shall submit copies of the foregoing
documentation to HRA with respect to any Eligible Property acquired pursuant to this
Agreement.
10. Other Program Requirements. GMHC shall carry out the acquisition activities under this
Agreement in compliance with all federal laws and regulations described in 24 CFR Part 570,
subpart K, except that (i) GMHC does not assume HRA's environmental responsibilities
described at 24 CFR 570.604; and (ii) GMHC does not assume HRA's responsibility for
361662v3 MJM RC125-296 5
~~~~
initiating the review process under the provisions of 24 CFR Part 52 (Intergovernmental Review
of HUD Development Programs and Activities). GMHC shall execute the attached certifications
regarding lobbying and debarment in conjunction with the execution of this Agreement, as
provided in Exhibit H. GMHC may not incur administrative costs.
11. Suspension and Termination. If
Agreement after written notice and an o
The time period for said opportunity to
requirements of the applicable law, regul~
materially fails to comply with any term of this
xrlity to cure, this Agreement may be terminated.
will be dependent upon the relevant time period
program, or otherwise.
12. Notice. Except as otherwise provided in Exhibit G, all communications, notices, and
demands of any kind which either party may be required or may desire to give to or serve upon
the other shall be made in writing, and such notice shall be deemed sufficiently given if and
when it is addressed to then other party as~iprovided below and either (a) delivered personally, (b)
deposited in the United States mail, registered or certified, with postage prepaid, (c) deposited
with an overnight delivery service for next day delivery, or (d) telecopied:
To HRA: Richfield Housing ' d Redevelopment Authority
Attention Mr. John~tark, AICP, Director of Community Development
6700 Portland Avenue
Richfield, Minnesota 55423-2599
Fax: (612) 861-8974
To GMHC: Greater Metropolitan Housing Corporation
Attention: Carolyn Qlson
15 South Fifth Stre t, Suite 710
Minneapolis, MN 5402
13. Data Practices. GMHC agrees to abide by the provisions of the Minnesota Government
Data Practices Act and all other applicably State and Federal laws, rules, and regulations relating
to data privacy and confidentiality, and as ,any of the same may be amended.
14. Access to Records. HRA shall have the authority to review any and all procedures and
all materials, notices, and documents prepared by GMHC in implementation of this Agreement.
15. Indemnification. GMHC agrees to hold harmless, indemnify and defend HRA, its elected
officials, officers, agents, and employes against any and all claims, losses, or damages,
including attorneys' fees, arising from, llegedly arising from, or related to, the provision of
services under this Agreement by GMHC, its employees, agents, officers, or volunteer workers.
16. Independent Contractor. Nothing in this Agreement is intended, nor may be construed, to
create the relationship of partners or employer/employee between the parties. GMHC, its
officers, agents, employees, and volunteers are, and will remain for all purposes and services
under this Agreement, independent contractors.
17. Entire Agreement. The entire agreement of the parties is contained in this document. This
361662v3 MJM RC 125-296 6
,~~-~
Agreement supersedes all previous written and oral agreements and negotiations between the
parties relating to the subject matter of this Agreement except as provided in paragraph 18 of this
Agreement.
18. Certain Earlier Agreement between the Parties. Notwithstanding any provision in this
Agreement to the contrary, that certain agreement entitled Acquisition and Services Agreement
dated and entered into by and between the parties shall remain in full force and effect
except that the provisions of this Agreement relating to scope of work; Uniform Relocation Act;
acquisition, rehabilitation, and resale; documentation; other program requirements; and access to
records shall prevail and replace any inconsistent provision in that certain earlier agreement.
19. Severability. The invalidity, illegality or enforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision of this
Agreement, all of which shall remain in full force and effect.
20. Assignment of Agreement. The parties shall not assign this Agreement without the
express written consent of the other party.
21. Modification. No provision, term or clause of this Agreement shall be revised, modified,
amended or waived except by an instrument in writing signed by both parties.
22. Counterparts. This Agreement may be executed in any number of counterparts and each
such counterpart shall be deemed to be an original, all of which, when taken together, shall
constitute one agreement.
23. Headings. The titles to the sections and headings of various paragraphs of this
.Agreement are placed for convenience of reference only and in case of conflict, the text of this
Agreement, rather than such titles or headings shall control.
24. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit
of the successors and assigns of each of the parties hereto.
25. Invalidity. If for any reason any portion or paragraph of this Agreement shall be declared
void and unenforceable by any court of law or equity, it shall only affect such particular portion
or paragraph of this Agreement, and the balance of this Agreement shall remain in full force and
effect and shall be binding upon the parties hereto.
26. Governing Law. This Agreement shall be governed and construed in accordance with the
laws of the State of Minnesota.
27. Obligations Limited. HRA's obligation to .make payments under this Agreement is
limited entirely to NSP 1 Award funds being remitted to HRA in sufficient amounts and
available for the purposes for which such payments are sought. HRA shall have no obligation to
make payments under this Agreement from sources other than the NSP 1 Award.
(Signature pages follow.)
361662v3 MJM RC125-296 '~
~r I ~ V
IN WITNESS WHEREOF, the parties have hereunto set their hands the day and year first
above written.
HOUi SING AND REDEVELOPMENT AUTHORITY IN
ANI~ FOR THE CITY OF RICHFIELD, MINNESOTA
By
Its
By
Its ~I
GRFJ,ATER METROPOLITAN HOUSING
CORrORATION
By
Its
361662v3 MJM RC125-296 g
3~_ /
EXHIBIT A
NSP ELIGIBLE AREA
N Legend ~. r ir: is
-••~ r ~ "J3F 1 rci E3~ur
`I4P Ti-r ; Grer.-
c:CI~. ~9f J'~t5 _,.:?a9S I7<9V C' tj I • JC `~_ ~~_ _~vsur:~ ' ~< sr;;re of less !tier 8.
361662v3 MJM RC125-296 A-1
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EXHIBIT B
COMPLIANCE DOCUMENTS
361662v3 MJM RC 125-296 B-1
~~--/~
EXHIBIT C
GUIDEFORM
NSP VOLUNTARY ACQUISITION OF FORECLOSED PROPERTY
Grantee or Agency Letterhead
(date)
Dear
((City, County, State, other) , is interested in acquiring property you
own at (address) for a project receiving funding assistance
from the U.S. Department of Housing and Urban Development (HUD) under the Neighborhood
Stabilization Program (NSP).
Please be advised that the (City, County, State, other) possesses
eminent domain authority to acquire property. However, in the event you are not interested in
selling your property, or if we cannot reach an amicable agreement for the purchase of your
property, we will not pursue its acquisition under eminent domain.
Your property is not a necessary part of the proposed project and is not part of an intended,
planned, or designated project area where substantially all of the property within the area is to be
acquired.
Under the NSP, we are required to purchase foreclosed property at a discount from its current
market appraised value. Our appraisal indicates the property's market value is
$ We are prepared to offer you $ to purchase your
property. This offer is less than the current market appraised value as required by the NSP.
Please contact us at your convenience if you are interested in selling your property.
In accordance with the Uniform Relocation Assistance and Real Property Acquisition Policies
Act (URA), owner-occupants who move as a result of a voluntary acquisition are not eligible for
relocation assistance. Atenant-occupant who moves as a result of a voluntary acquisition for a
federally-assisted project may be eligible for relocation assistance. Such displaced persons may
include not only current lawful occupants, but also former tenants required to move for any
reason other than an eviction for cause in accordance with applicable federal, state, and local
law. If your property is currently tenant-occupied or a tenant lawfully occupied your property
within the past 3 months prior to our offer, we need to know immediately. Further, you should
not order current occupant(s) to move, or fail to renew a lease, in order to sell the property to us
as vacant.
If you have any questions about this notice or the proposed project, please contact
(name) , (title)
(address) ,(phone)
361662v3 MJM RC125-296 C_ 1
~~~
TEXT BELOW SHOWN. FOR
TEMPLATE FORM
CE BUT WILL BE DELETED FOR THE
NOTES to NSP Voluntary Acquisition
1. The case file must indicate the manner
return receipt requested) and the date
Handbook 1378)
2. Tenant-occupants displaced as a resu
relocation assistance and must be so
negotiations, and 49 CFR 24 Appendix
3. See 49 CFR 24.206 regarding eviction
4. This guideform may only be used if
are met.
5. This is a guideform. It should be revis
Foreclosed Property Informational Notice
in which this notice was delivered (e.g., certified mail,
>f delivery. (See 49 CFR 24.5 and Paragraph Z-3 J of
of a voluntary acquisition may be entitled to URA
nformed per 49 CFR 24.2(a)(15)(iv) -Initiations of
A - 24.2(a)(15)(iv).
'or cause.
l of the requirements of 49 CFR 24.101(b)(1)(i)-(iv)
to reflect the circumstances.
;,
361662v3 MJM RC125-296 C_2
~~~~~
EXHIBIT D
PTFA CERTIFICATION
SELLER'S OCCUPANCY CERTIFICATION UNDER
THE PROTECTING TENANTS AT FORECLOSURE ACT
(FOR VACANT PROPERTY ONLY)
[To be completed and signed by the seller of the property.)
Address of Property ("Property")
City, State Zip
The undersigned, Seller of the Property certifies to Twin Cities Community Land Bank LLC
(Buyer) that
Seller has complied with the provisions of the Protecting Tenants at Foreclosure Act, Title VII
of the Helping Families Save Their Homes Act of 2009 ("PTFA") in connection with the
Property, including any requirements of the giving of notice to vacate ("Notice") as required
pursuant to PTFA to any bona fide tenant of the Property if any such tenant was in possession of
the Property prior to Seller's notice of foreclosure; and
At the time of the acquisition of the Property by the buyer/grantee, the Property will be delivered
vacant, unoccupied and without any party in possession or with a right to possession to the
Property.
Further, if the Property is not occupied at this time, the Seller also certifies and agrees that it has
not now and will not after the date hereof allow any person, including the former owner, to
occupy the Property under a lease or any other agreement for possession of the Property either
oral or written.
Signature of Seller
By:
Name:
Its:
Date:
361662x3 MJM RC 125-296 D-1
3~-~~
EXHIBIT E
P OCEDURES
Memorandum of Understanding
Properties, In General:
• GMHC will identify, purchase, rehabilitate, and resell up to four Eligible Properties at the
direction of HRA where
^ two of the four properties for subsequent resale to households earning at or below
120% of Area Median Income,.; and
^ two of the four properties for subsequent resale to West Hennepin Affordable
Housing Land Trust, a no -profit corporation under the laws of Minnesota
("WHALT"), for households e ing at or below 50% of Area Median Income;
• except that if HRA may identify, purchase, rehabilitate, and resell Eligible Property without
the assistance of GMHC, then
• HRA reserves the right and GMHC agrees to identify, purchase, rehabilitate, and resell more
than four Eligible Properties in the event HRA approves additional funds for this purpose.
Identification of Eligible Property:
• GMHC or HRA will identify Eligible roperties.
• If HRA identifies Eligible Property, HRA (in its sole discretion) may provide GMHC with
the identity of the Eligible Property.
• If GMHC identifies Eligible Property, GMHC will provide HRA with the identity of the
Eligible Property so that HRA may d tide whether HRA will use NSP funds to acquire said
Eligible Property.
Purchase of Eligible Property:
• GMHC will only purchase an Eligible Property with HRA funds after receipt of HRA's
express written consent.
• HRA may express its written consent Yia email to GMHC at bbuelow(c~gmhchousin .or .
• HRA will fully cooperate to meet the s'itrict timelines of the First Look Program.
• GMHC shall be responsible for the timely completion of all NSP, County, TCCLB, and
NCST required documentation.
• GMHC agrees to purchase and hold t e Eligible Properties in its name unless HRA informs
GMHC that HRA desires (in HRA's s~le discretion) to hold an Eligible Property in the name
of HRA.
Rehabilitation of Eligible Property:
• After GMHC has purchased an Eligible Property, GMHC will work with HRA to identify
necessary improvements.
• GMHC and HRA will agree in writin to a rehabilitation plan that describes, at a minimum,
expenses, improvements, and deliverable dates, prior to GMHC beginning its rehabilitation
efforts at that Eligible Property.
• Upon completion of the rehabilitation of each Eligible Property to the satisfaction of HRA,
HRA will reimburse GMHC for its rehabilitation costs as set forth in the rehabilitation plan
361662v3 MJM RC 125-296 E-1
3~-r5
for each Eligible Property. GMHC will provide HRA with all requested information,
including but not limited to receipts, prior to receiving reimbursement funds from HRA.
• The rehabilitation plan may be amended from time to .time as needed with the prior mutual
consent of HRA and GMHC.
Subsequent Resale of Certain Eligible Property to End Buyer:
• After GMHC completes the rehabilitation of an Eligible Property, GMHC will market said
Eligible Property and execute a purchase agreement with an end buyer whose household
income is at or below 120% of Area Median Income.
• Each subsequent resale of an Eligible Property must be to a NSP qualifying individual and
the purchase loan documents must ensure the continued affordability of the Eligible Property
for the affordability period as provided in Federal regulations and notices.
Subsequent Resale of Certain Eligible Property to WHALT:
• At the direction of HRA, GMHC will purchase and rehabilitate up to two Eligible Properties
that will be subsequently resold by either GMHC to WHALT for $1.00 per Eligible Property.
• Thereafter, WHALT will resell each of these two properties to a household earning at or
below 50% of Area Median Income the terms of which are set forth in the Housing Services
Agreement dated between HRA and WHALT.
Acquisition of Properties Outside of the NSP Eligible Area:
• In the event GMHC identifies a property in the City that is outside of the NSP Eligible Area,
GMHC will notify HRA of the availability of the property.
• If HRA wishes to acquire said property, GMHC agrees to assist HRA as needed.
Acquisition, Rehabilitation and Resale of non-NCST Eligible Properties:
• In the event GMHC or HRA identifies a property in the City through means other than NCST
and the First Look Program, GMHC or HRA will notify the other of the availability of the
property.
• If HRA wishes to acquire said property, GMHC agrees to assist HRA as set forth in this
Agreement.
Reimbursement of Funds
• GMHC will request reimbursement of NSP-eligible costs directly from County using certain
form required by County after written consent by HRA for each reimbursement request.
361662v3 MJM RC125-296 E-2
~bq-~ ~
!EXHIBIT F
TCCLB ACQUISITION PROCESS
Step
No.
1.
2.
3.
4.
5.
6.
Foreclosure redemption period ends. O ler the next 2-4 weeks, Lender-Owner ensures house is
vacant and secured. No property should jbe purchased if a bona fide tenant will be displaced as a
direct result of acquisition for anNSP- assisted activity. Lender must cert~ compliance with
tenant protections under ARRA. 24 CFR 42.305 - 42.350, 42 USC 5304(d), 49 CFR 24.2(a)(15)
Lender a-mails the foreclosed property ddresses to NCST. NCST provides list of properties in
zip codes identified by the buyer. TCC B posts the NCST List to Google Docs. Developers are
notified new properties are available for onsideration via email.
For properties posted before 3 pm, each Developer is given until 9 am the following business
day to review new property lists and indicate which properties, if any, it is interested in
inspecting. For properties posted after 3' pm, each Developer is given until 11 am the following
business day to review new property list
i
i
D
l
il
e and indicate which properties, if any, it is interested in
"
"
nspect
ng.
eve
oper w
l update the d signated field in the Google Docs form to
yes
if it is
interested in inspecting a property.
y
Entry for inspection of selected properti es is made through Lender's REO Managers/Agents by
each Developer referencing the property is being jnspected through the First Look program. If
Developer is interested in a property afte r inspection,' Developer obtains BPO.
I ~
Within 5 business days of date property is posted, the interested Developer is required to return
to Google Docs .and indicate if it wa is to receive pricing for each inspected property by
updating the designated field to "yes" in Google Docs. If pricing is not desired, a reason should
be indicated. A response is due by 9 amp for properties originally posted before 3 pm, l lam for
properties posted after 3 pm.
y
NOTE: Developers are responsible for f pal verification that properties selected for pricing are
within NSP 1 eligible areas or will qua y for arty other development programs for which they
currently have funding.
TCCLB requests Lender's prices on the selected properties. Lender obtains FMV estimate and
makes appropriate adjustments to equ 1 Lenders Adjusted Price. NCST e-mails Lender's
Adjusted Price to TCCLB. NCST Guide lines and TCCLB procedures
y
8. TCCLB posts the price of each propert
For prices posted by 3 pm, each Dever
indicate if it would like to proceed with
will have until 11 am the following bi
purchase. In the event more than 1 D
follows: 1) Columbia Heights Commun
developers 4) Private developers 5) Nor
than one Developer in any category is i
determine what order the development I
Developer must also send an email t~
on Google Docs for review by interested Developers.
per will have until 9 am the following business day to
urchase. For prices posted after 3 pm, each Developer
'mess day to indicate if it would like to proceed with
eloper is interested in a property, priority will be as
Development 2) NSP Developers 3) Other nonprofit
'ofit developer buying for a Private developer. If more
erested in a property. A lottery system will be used to
-tners will be given priority in purchasing the property.
infomplsna,tcclandbank.or~ to confirm acceptance of
NCST
Timeline
Day
1
5 days
Day
6
Day
7
361662v3 MJM RC125-296 F_ 1
~~~~~
9.
10.
11.
12.
13.
14.
15.
16.
17.
18
19.
pricing. This email is binding.
TCCLB sends "Preliminary Acquisition Notice" to Lender re: potential interest in buying
property and extending invitation to accompany Developer-hired appraiser. Further
NCST/HUD guidance to be delivered.
At the time of a-mail acceptance of Lender/seller's price, Developer sends assigmnent to the
appraiser, along with a URA scope of work (An appraisal is needed even if the parcel will be
donated. But note: If the anticipated value does not exceed $25,000, review of available data by
a person qualified to make the valuation may be substituted for an appraisal. If Lender already
has a URA appraisal meeting NSP requirements, another appraisal is not required so long as the
NCST Purchase Agreement will be signed within 60 days from the Lender's appraisal date.)
At the time of a-mail acceptance of Lender/seller's price, Developer is responsible for
completing the NSP Initial Property Set-up form and submitting it to Tonja West-Hafner at
tonja.k.west-hafner~u,hennepin.co.mn.us (cc: Julie Urban at jurban s cityofrichfield.org and
Michelle Lewis at mlewis(u~cityofrichfield.ora). Ms. West-Hafner will order the appraisal,
environmental review, and lead paint inspection (pre-1978 homes).
Developer receives and reviews URA appraisal and determines whether or not to buy property at
Lender's Adjusted Price which cannot exceed URA appraisal value less (minimum) 1 percent
discount. If approval from State Historic Preservation Office staff has not been received at this
point, offer must be conditional. A copy of the appraisal and SHPO e-mailed to TCCLB for file.
At the time of a-mail acceptance of Lender/seller's price, TCCLB sends Exhibit C-1, Voluntary
Sale Offer Letter, Exhibit C-2, Seller's Occupancy Certificate and NCST Purchase Agreement to
Lender re: URA appraisal value, price offered, no eminent domain and no displacement.
y
TCCLB receives executed NCST Purchase Agreement and signed Seller's Occupancy
Certificate from Lender.
At the time of a-mail acceptance of Lender/seller's price, TCCLB obtains title work and verifies
that Lender will pass marketable title. TCCLB obtains earnest money from Developer within 1
business day and sends earnest money, if required, to Escrow Agent. TCCLB schedules
concurrent purchase and resale closings with Title Company. Title Company sends
confirmation closings are scheduled to all parties.
TCCLB processes resale purchase agreement and forwards to Developer for review and
signature.
Lender and Title Company Closer prepare NCST closing package. TCCLB and Title Company
prepare resale closing package.
y
TCCLB and Developer review file checklist to ensure all supporting documentation is on file
and completed within 14 days of a-mail acceptance. If any documentation has not been
received, closing will be delayed until all documentation is on file.
y
Upon verification of receipt of all required documentation, including SHPO - approvals,
Day
Day
10
Day
18
Day
20
Day
361662v3 MJM RC125-296 F-2
~/~- ~ f~
scheduled closing date is confirmed with Title Company and TCCLB and Developer proceed to 25
purchase and resale closings.
20. Developer now owns selected property. ~I
DEFINITIONS OF ABBREVIATIONS
BPO Broker Price Opinion
FMV Fair Market Value
MLS Multiple Listing Service
NCST National Community Stabili ation Trust
NCST List A list of foreclosed properti sin target areas that Lenders e-mail to NCST. NCST a-mails this list
to TCCLB who then forwar sit to Brooklyn Center Business and Development Department and
other Developers.
NSP Neighborhood Stabilization Program
SHPO State Historic Preservation Office
TCCLB Twin Cities Community Land Bank LLC
URA Uniform Relocation Act
~, ~.~.
361662v3 MJM RC125-296 F-3
~~-l~
EXHIBIT G
FORM PURCHASE AGREEMENT
NSP I PURCHASE AGREEMENT
Seller: Twin Cities Community Land Bank LLC
Buyer: Greater Metropolitan Housing Corporation
Property Address:
Parcel:
Effective Date: , 20
361662v3 MJM RC125-296 G-1
i
~!9-~O
TABU OF CONTENTS
Section 1. Property ..............................'~.................:...................................
Section 2. Purchase Price ........................................................................
Section 3. Effective Date ........................................................................
Section 4. Evidence of Title and Rem edies .............................................
Section 5. Closing and Possession.....i .....................................................
Section 6. Conveyance of Title and P rmitted Encumbrances ................
Section 7. Closing Adjustments and P orations .......................................
Section 8. Conditions to Closing ....... .....................................................
Section 9. Seller's Warranties ............ .....................................................
Section 10. Seller's Closing Document s ....................................................
Section 11. Buyer's Closing Document s ...................................................
« »
Section 12. Property Conveyed As Is .....................................................
Section 13. Voluntary Sale ...................'~ .....................................................
Section 14. Operation Prior to Closing .....................................................
Section 15. Condemnation ................... ........:............................................
Section 16. Risk of Loss ....................... ...............................................:.....
Section 17. Remedies ............... " `'
Section 18. Conditions Precedent to Ob ligations of Seller ........................
Section 19. Broker's Commission ....... .....................................................
Section 20. Notices ..............................: .....................................................
Section 21. Miscellaneous Provisions .. .....................................................
Exhibit A Legal Description
Exhibit B Contract for Purchase oif First Look Program Property
................ ............1
................................2
................................2
................................2
................................3
................................3
................................4
................................5
................................7
................................8
................................8
.............. ..............9
................................9
................................9
..............................10
..............................10
.......................... .10
..............................11
..............................1.1
361662v3 MJM RC125-296 G-2
~D~-a.!
N5P I PURCHASE AGREEMENT
THIS NSP I PURCHASE AGREEMENT ("Agreement") is made as of the day
of 20_, by and between Twin Cities Community Land Bank LLC, a
Minnesota nonprofit corporation ("Seller"), and Greater Metropolitan Housing Corporation, a
Minnesota nonprofit corporation ("Buyer").
Recitals
A. Buyer wants to acquire certain real estate and improvements located at
Richfield, Minnesota.
B. Seller has entered into the purchase agreement attached hereto as Exhibit B ("Contract
for Purchase of First Look Program Property") to acquire the Property (as defined below)
from on , or such other earlier or
later date as the Seller and may mutually agree (the "First
Look Purchase Closing Date"), and Buyer has agreed to thereafter acquire the Property
from Seller.
C. Seller and the Housing and Redevelopment Authority in and for the City of Richfield
("City"), a body corporate and politic under the laws of the State of Minnesota ("HRA"),
have entered into the First Look Program Acquisition Agreement relating to the purchase
of certain Eligible Properties (as defined in the First Look Program Acquisition
Agreement) under which HRA, or at HRA's direction Buyer, has agreed to purchase
certain Eligible Properties (as defined therein) pursuant to a program called "First Look"
("First Look Program") with the National Community Stabilization Trust ("NCST").
D. Whereas, the parties have determined that the Property is an Eligible Property.
E. The parties wish to define their respective rights, duties and obligations related to the
sale/purchase of the Property.
NOW, THEREFORE, in consideration of the mutual promises and the respective
agreements contained herein, the parties hereby agree as follows:
SECTION 1. PROPERTY
Seller agrees to sell and Buyer agrees to purchase the Property, together with all
hereditaments, improvements, and appurtenances, including:
(a) Property. That certain real property located in Hennepin County, Minnesota,
legally described on Exhibit A attached hereto (the "Real Estate") together with:
(i) all buildings and improvements now or hereafter constructed or located on the
Real Estate (the "Improvements"), and (ii) all easements, interests, rights and
privileges benefiting or appurtenant to the Real Estate including, but not limited
to, all right, title and interest of Seller in, over and to any land lying in the bed of
any highway, street, road, avenue, or alley existing or proposed, in front of or
361662v3 MJM RC125-296 G-3
~}'t~~
abutting or adjoining the Real Estate, and all right, title and interest of Seller in
and to any unpaid award f r the taking by eminent domain of any part of the Real
Estate or the Improvement or for damage thereto by reason of a change of grade
of any highway, street, ro d, avenue, or alley (the "Other Interests") (the Real
Estate, Improvements and Other Interests will be collectively referred to as the
"Property"), and ',
(b) Warranties. An assignment of all of Seller's right, title and interest in and to the
warranties of title, if any I that Seller received from the former owner of the
Property at the time Seller ~cquired the Property (the "Warranties").
SECTION L. PURCHASE PRICE
The purchase price for the Property is Dollars
($ .00) ("Purchase Price"), which is due and payable to Seller at the place of closing on
and as of the Closing Date. ',
SECTION B. EFFECTIVE DATE
The "Effective Date" of this Agr~ement is the date upon which the Seller has executed
this Agreement.
SECTION 4. EVIDENCE OF TITLE AND REMEDIES
Within a reasonable time after the date of this Agreement, Buyer, at its expense, will
obtain a commitment for an owner's pol'~ cy of title insurance covering the Property from Old
Republic National Title Insurance Compa y (the "Title Company") and provide Seller a copy of
the same. The commitment will inclu e copies of all instruments shown as exceptions or
referred to therein. No later than five (5) ays prior to the Closing Date, Buyer shall notify. Seller
of any objections to title, including covenants, conditions, restrictions and easements of record.
If any objections are made, Seller will have fifteen (15) days to make title marketable or
insurable to the satisfaction of the Title Company. If Seller fails to have the exceptions removed
or satisfied within the time provided, Buyer may elect to do any of the following:
(i) Waive the objection; or
(ii) Terminate this Agreement by delivering written notice thereof to Seller without
further obligation or claim or damages between the parties.
If, prior to closing, Buyer learns of any lien against the Property or any encumbrance upon or
defect in Seller's title to the Property which has arisen because of any action on the part of Seller
after the date this Agreement has been fully executed (a "Later Objection"), Seller is obligated to
cure such Later Objection within five (5) days after receiving written notice of the Later
Objection from Buyer. If Seller fails to s cure any Later Objection, Buyer has the right to take
any of the actions specified above in (a) d (b) of this Section 4.
i
361662v3 MJM RC125-296 'i C7-4
~~=a~
SECTION 5. CLOSING AND POSSESSION
(a) Subject to the provisions of Sections 4 and 8, closing shall occur simultaneously
with the First Look Purchase Closing Date, or such other later date as Seller and
Buyer may mutually agree (the "Closing Date"), at which time Seller shall deliver
marketable or insurable title to and possession of the Property to Buyer. The
Closing Date may be extended by agreement of Buyer and Seller. Any consent to
an extension of the Closing Date by Seller shall not be unreasonably withheld.
(b) Closing will be at the offices of the Title Company or at such other place as
designated by Buyer. At closing, Buyer shall deposit with the Title Company
sufficient funds to pay the Purchase Price as described in Section 2. Buyer also
shall pay the title insurance premium and all closing costs charged by the Title
Company for conducting the closing.
(c) Seller shall vacate the Property no later than the date of Buyer's. pre-closing walk
through inspection of the Property, which date will be no earlier than two (2) days
before the Closing Date.
SECTION 6. CONVEYANCE OF TITLE AND PERMITTED ENCUMBRANCES
Seller, at its own cost and expense or by application of the funds deposited by Buyer with
the Title Company, shall deliver to .the Title Company at or prior to closing a deed [which deed
may be a Limited Warranty Deed or Quit Claim ("Deed")], Bill of Sale, if any, and such other
documents as in the Title Company's opinion will, upon the receipt, filing, recording, or
registration thereof, vest in Buyer a marketable or insurable title to the Property, together with
lawful ownership of all fixtures, process utilities, or items of immovable property located thereon
or pertinent thereto, free and clear of any taxes and liens, special and pending assessments (not
assumed by Buyer), or encumbrances of any nature. whatsoever, except:
(a) Restrictions, reservations, covenants and easements of record on the Effective
Date;
(b) Building and zoning laws, ordinances, state and federal regulations;
(c) Reservation of mineral or mineral rights to the State of Minnesota;
(d) General real estate taxes due and payable in the year of closing and subsequent
years; and
(e) To the extent waived by Buyer.
361662v3 MJM RC 125-296 G-5
~ ~--a~
SECTION 7. CLOSING ADJUSTMENTS AND PROBATIONS
The following adjustments and prorations will be made at closing:
(a) Buyer shall pay all state deed tax or other taxes that must be paid in order to
record the Deed for the Pro erty.
(b) At or before closing, Selle shall have caused to be paid all real estate taxes and
any penalties and interest t ereon due and payable with respect to the Property in
all years prior to the year of closing.
(c) At or before closing, Seller shall have caused to be paid all deferred real estate
taxes (including so called Green Acres" taxes), together with any penalties and
interest thereon, which hav been deferred as of the Closing Date.
(d) At or before closing, if not previously paid by Seller, Buyer shall assume all
special assessments levied, pending or deferred against the Property as of the
Closing Date, including all deferred assessments, including all those which
become due and payable as a result of the sale of the Property to Buyer. Seller
will pay on a prorated ba is any special assessments certified for payment with
the current year's real estatl taxes.
(e) At closing, general real estate taxes due and payable in the year of closing shall be
prorated between Buyer at~'d Seller as of the First Look Purchase Closing Date on
a calendar year basis. In the event taxes for the current year are unavailable or
unknown, said taxes shall e prorated on the basis of the taxes for the prior year.
(f) Buyer shall pay all real estate taxes due and payable in the year following closing
and all subsequent years thereafter, if any.
(g) Buyer shall reimburse Seller the cost paid by Seller for an appraisal of the
Property.
(h) Buyer shall reimburse Seller the cost paid by Seller to Purchase the Property
pursuant to the First Look~,Program; such costs shall include the closing fee, the
cost of commitment for an owner's policy, the cost of an owner's policy of title
insurance, the cost of recording all documents necessary to place title to the
Property in the name of Seller, and the cost of miscellaneous items as evidenced
by the closing statement fog the closing of Seller's purchase of the Property under
the First Look Program.
(i) Buyer shall pay to the Seller an administrative fee of Fifteen Hundred and No/100
Dollars ($1,500.00). ',
361662v3 MJM RC125-296 G-6
~~ ~a~'
SECTION 8. CONDITIONS TO CLOSING
This Agreement is hereby expressly made subject to the following conditions having
been complied with on or before the Closing Date or as otherwise specified:
(a) First Look. Seller has purchased the Property pursuant to the NCST First Look
Purchase Agreement and in compliance with the First Look Program Acquisition
Agreement between Buyer and the Seller and title to the .Property has been
delivered to Seller.
(b) Seller Acquisition Documents. If the First Look Purchase Closing Date occurs
prior to the Closing Date, Seller shall provide to Buyer copies of all closing
documents from Seller's purchase of the Property, including a marked copy of the
title commitment along with all documentation as required under the First Look
Program Acquisition Agreement between Buyer and Seller.
(c) Representations and Warranties. The representations and warranties of Seller that
are contained in this Agreement are true as of the Effective Date and the Closing
Date and are intended to survive the closing.
(d) Title. Buyer must be able to acquire marketable or insurable title to the Property.
(e) Title Policy. Buyer must be able to obtain a title insurance policy for the Property
in a form and substance that is satisfactory to Buyer (the "Title Policy").
(fj Performance of Seller's Obli atg ions. From the date of this Agreement until the
Closing Date, Seller shall have performed all of Seller's obligations under this
Agreement, as and when required by this Agreement, and Seller shall have
delivered Seller's Closing Documents (as defined below) to Buyer in accordance
with Section 10.
(g) Site, Soil and Environmental Testing. Seller shall have allowed Buyer, its
contractors or agents, access to the Property without charge and at all reasonable
times for the purpose of site, soil and environmental investigation and testing of
the Property. Buyer shall have paid all costs and expenses of such investigation
and testing and shall hold Seller harmless from all costs and liabilities relating
thereto (except for such costs and liabilities that may arise in connection with the
remediation of any pre-existing hazardous waste or pollution problem that is
discovered as a result of such investigation and testing). Buyer shall further repair
and restore any damage to the Property caused by or occurring during Buyer's
investigation and testing and return the Property to substantially the same
condition as existed prior to such entry. In addition, Buyer shall provide Seller
with copies of all reports and tests on the Property that have been obtained by
Buyer, if Buyer does not purchase the Property.
(h) Leases. The Property is not subject to any leases or occupancy agreements.
361662v3 MJM RC 125-296 G_7
~~-a ~
(i)
and responsibilities under
Any and all of the foregoing cc
and 8(e), and may be waived, in writir.
satisfied, Buyer shall have the right to
claim for damages between the parties ]
have the right to terminate this Agref
between the parties hereto.
SECTION 9.
'S WARRANTIES
As an inducement to Buyer entering into this Agreement, and as part of the consideration
therefor, Seller represents and warrants to!Buyer~hat as of the Closing Date:
(a) Authori This Agreeme
Closing Documents to be
delivered at closing; such
and will not conflict with c
of any court or arbiter to
Agreement and the closin
the valid and binding obli;
their terms.
(b) Title to Pro e~rty.
encumbrances and f
disclosed in the Title
~tions. Buyer shall assume all of Seller's obligations
NCST First Look Purchase Agreement.
itions are for the benefit of Buyer, except items 8(a)
by Buyer. If any of the foregoing conditions are not
rminate this Agreement without further obligation or
eto. If items 8(a) or 8(e) are not satisfied, Seller shall
ant without further obligation or claim for damages
:has been duly executed and delivered; all of Seller's
signed by Seller will have been duly executed and
~ecution, delivery and performance by Seller does not
result in a violation of any judgment, order, or decree
vhich Seller is a party or by which it is bound; this
documents that will be signed by Seller will contain
~tions of Seller and be enforceable in accordance with
owns the Property, free and clear of all liens,
unents, recorded or unrecorded, except as may be
tment.
(c) Permits. To the best of ~eller's knowledge, no permits are required from any
governmental entity in ord r to operate the Property as it is now operated.
(d) Storage Tanks. To the extent storage tanks exist on or under the Property, such
storage tanks have been duly registered with all appropriate regulatory and
governmental bodies and i are, to the best of Seller's knowledge, otherwise in
compliance with applicable federal, state and local statutes, regulations,
ordinances and other regulatory requirements.
(e) Rights of Others to Purchase Property. Other than the NCST First Look Purchase
Agreement, Seller has nod entered into any other contracts for the sale of the
Property, nor are there a~y rights of first refusal or options to purchase the
Property or any other r'ight's of others that might prevent the consummation of this
Agreement.
(f) Seller's Defaults. To the best of Seller's knowledge, Seller is not in default of any
of its obligations or liabilities regarding the Property.
(g) Proceedings. To the bend of Seller's knowledge, there are no claims, actions,
suits, proceedings or investigations pending or, to Seller's knowledge, threatened,
361662v3 MJM RC125-296 li G_g
~~ ray
including bankruptcy proceedings, by any governmental department or agency, or
any corporation, partnership, entity or person, which in any manner or to any
extent may affect: (i) the Property; (ii) Seller's right, title .and interest in and to
any part or all of the Property; or (iii) Seller's ability to vest in Buyer a fee simple
ownership interest in the Property free and clear of any and all liens and rights of
redemption.
(h) Agents and Employees. No management agents or other personnel employed in
connection with the operation of the Property employed by Seller have the right to
continue such employment after the Closing Date. There are no claims for
brokerage commissions or other payments with respect to any leasing of all or any
part of the Property that will survive and remain unpaid after the Closing Date.
(i) Wells. Seller shall disclose knowledge of any wells located on the Property.
(j) Sewage Treatment S sue. To Seller's knowledge there is no individual sewage
treatment system on or serving the Property, a straight pipe-system does not exist
and a previous inspection report does not exist, or if a previous inspection report
exists, such report is attached to this Agreement.
(k) Geotechnical and Environmental Disclosures. Except as disclosed to Buyer and
in this Agreement or any exhibit hereto, to the best of Seller's information and
belief, Seller is not aware of any geotechnical problems on the Property or
contaminants, pollutants, hazardous .wastes or hazardous substances present upon
the Property in amounts that constitute a violation of any federal or state statute or
regulation or local ordinance.
(1) Public Improvements and Assessments. Seller has not received notice of any new
public improvement project(s) or assessments, the cost of which a governmental
entity may assess against the Property.
(m) Methamphetamine. To Seller's knowledge, no methamphetamine production has
occurred on the Property.
Each of the representations and warranties contained in this Agreement shall survive the
closing and the consummation of this Agreement by Buyer with knowledge of any such breach
by Seller will not constitute a waiver or release by Buyer of any claims due to such breach.
SECTION 10. SELLER'S CLOSING DOCUMENTS
On the Closing Date, Seller shall execute and/or deliver to the Title Company, with
copies to Buyer, and make arrangements to have the closing agent record or file in the
appropriate county land records any documents necessary to establish the marketability or
insurability of Seller's title to the Property; including the following (collectively, the "Seller's
Closing Documents"):
(a) Deed. A Limited Warranty Deed conveying the Property to Buyer in the manner
described in Section 6 herein.
361662v3 MJM RC125-296 G-9
~~-a~
(b) Assignment of Warranties ~ An Assignment of Warranties, pursuant to which the
Warranties described in Se tion 1(b), if any, will be assigned to Buyer.
(c) Seller's Affidavit. An Affidavit of Title duly executed by Seller indicating that on
the Closing Date there arse no outstanding unsatisfied judgments, tax liens or
bankruptcies against or involving Seller or the Property; that there has been no
skill, labor or material furnished to the Property at Seller's request for which
payment has not been made or for which mechanics' liens could be filed; and that
there are no other unrec rded 'interests in the Property of which Seller has
knowledge except as state therein, together with such other certifications as may
be required by a title incur ce company to issue the Title Policy.
(d) FIRPTA Affidavit. Anon-foreign entity affidavit, properly executed and in
recordable form, containing such information as is required by IRC Section
1445(b)(2) and its regulations.
~i
(e) IRS Reporting Form. The appropriate Federal Income Tax reporting form, if any
is required.
(f) Recording Documents. A y necessary Storage Tank Affidavit, Well Certificate
or similar document that is needed to record the Warranty Deed.
(g) Other Documents. All :other documents reasonably necessary to transfer
marketable insurable title to the Property to Buyer free and clear of all liens.
SECTION 11. BUYER'S CLOSING DOCUMENTS
On the Closing Date, Buyer ill execute and/or deliver to Seller the following
(collectively, the "Buyer's Closing Doc ents"): "
(a) Purchase Price. The Purchase Price by check or ACH deposit of U.S. Federal
Funds.
(b) Title Documents. Such Affidavits of Purchaser or other documents as may be
reasonably required by a title insurer in order to record the Seller's Closing
Documents and issue the itle Policy.
SECTION 12. PR PERTY CONVEYED "AS IS"
The Property being purchased by Buyer, including the dwelling, other improvements and
fixtures, is not new and is being purchased in its "AS IS" condition, including all defects, known
or unknown. Buyer acknowledges the ~' Property may not be in compliance with applicable
building, zoning, health or other laws or codes, and that the Property may not be in habitable
condition. Buyer further agrees that Sell r, its agents, employees, representatives and assignees
shall have no liability for any claim or losses Buyer or Buyer's successors in interest and/or
assigns may incur as a result of defects w ich may now or may hereafter exist with respect to the
Property, and Buyer shall defend Seller, its agents and assignees from any such claim. Buyer
understands and agrees that Seller, his or her agents or assigns, will not, prior or subsequent to
361662v3 MJM RC 125-296 G_ 10
,3A --?.9
the closing, be responsible for the repair, replacement, or modification of any deficiencies,
malfunctions or mechanical defects in the material, workmanship, or mechanical components of
the structures, improvements, or land.
Buyer accepts any property interest conveyed herein "AS IS WITH ALL FAULTS" and
is not relying upon any representations or warranties or promises of any kind whatsoever,
express or implied, from Seller, except as otherwise provided herein or in one of Seller's Closing
Documents. ANY WARRANTIES OF PHYSICAL CONDITION OF THE PROPERTY
CONTAINED IN THIS AGREEMENT INCLUDING, BUT NOT LIMITED TO, CENTRAL
AIR-CONDITIONING, HEATING, PLUMBING, WIRING, AND CONNECTION TO CITY
SEWER AND CITY WATER ARE VOID TO THE EXTENT PERMITTED BY LAW. This
provision shall survive delivery of the Deed. All other warranties specified in this Agreement
remain the same.
SECTION 13. VOLUNTARY SALE
This is a voluntary negotiated sale between Seller and Buyer. The transaction
contemplated hereunder is not being made under the threat of eminent domain.
SECTION 14. OPERATION PRIOR TO CLOSING
During the period from the Effective Date to the Closing Date (the "Executory Period"),
Seller shall operate and maintain the Property in the ordinary course of business and in
accordance with reasonable business standards. Seller shall not, however, execute any contracts,
leases or other agreements affecting the Property during the Executory Period.
SECTION 15. CONDEMNATION
If, prior to the Closing Date, eminent domain proceedings are commenced against all or
any part of the Property, Seller shall immediately give Buyer written notice of such fact and
Buyer will have the right (to be exercised within thirty (30) days after receipt of Seller's notice)
to terminate this Agreement. If this Agreement is so terminated, neither party will have any
further obligations under this Agreement. If Buyer does not so terminate this Agreement, the
Purchase Price will be reduced by any condemnation awards paid to Seller prior to closing and
Seller shall, at closing, assign to Buyer all of Seller's right, title and interest in and to any. award
made or to be made in the condemnation proceedings.
SECTION 16. RISK OF LOSS
Seller assumes all risk of loss related to damage to the Property prior to the Closing Date.
In the event of fire, destruction or other casualty loss to the Property after Seller's acceptance of
this Agreement and prior to closing and funding, either Party may terminate this Agreement and
neither party shall have any further rights or liabilities hereunder except as otherwise provided
herein.
361662v3 MJM RC125-296 G-11
~~
SECTION 17. REMEDIES
If Buyer defaults under this Agreement, Seller will have the right to terminate this
Agreement by giving written notice to Buyer or Seller will have the right to seek and recover
damages from Buyer for Buyer's nonperf rmance of its obligations hereunder. If Buyer fails to
cure such default within the time per~od specified by Minnesota Statutes § 559.21, this
Agreement shall terminate. If Seller defa~ lts under this Agreement, Buyer will have the right to
seek and recover damages from Seller for Seller's nonperformance of its obligations hereunder or
to seek specific performance of this Agreement; provided that any action for specific
performance must be commenced within sixty (60) days after the Closing Date.
SECTION 18. CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER
The obligations of Seller to consummate the transaction contemplated by this Agreement
are subject to the fulfillment on or before the Closing Date of all of the following conditions, any
of which may only be waived by the Selle~ in writing:
(a) Re resentations and Warra ties True. All of the representations and warranties of
Buyer contained in this A reement shall be true and correct in all respects on and
as of the Closing Date.
(b) Covenants and Agreements Perform~d.~ . Buyer shall have performed and
complied with all covenants acid agreements or conditions contained in this
Agreement and delivered',; all documents, required by this Agreement to be
performed, complied with or delivered to Seller.
(c) Buyer's Closing Docum~nts. Seller shall have received Buyer's Closing
Documents as described in Section 10 of this Agreement.
SECTION 19. $ROKER'S COMMISSION
Seller and Buyer represent and warrant to each other that they have dealt with no other
brokers, finders or the like in connection's with this Agreement. Seller and Buyer each agree to
indemnify each other and to hold each ',other harmless against all claims, damages, costs or
expenses of or for any other such r commissions resulting from their actions or
agreements regarding the executiol of this Agreement.
361662v3 MJM RC125-296 G-12
~~' ` 3 1
SECTION 20. NOTICES
Any notice required or permitted to be given by any party upon the other (except for any
notice given pursuant to Minnesota Statutes § 559.21) is given in accordance with this
Agreement if it is sent to the party by delivering it personally to the individuals described below,
or it is sent by United States mail, return receipt requested, postage prepaid, or it is transmitted
by telefacsimile, or it is deposited cost paid with a nationally recognized, reputable overnight
courier, properly addressed as follows:
If to Seller: Twin Cities Community Land Bank LLC
615 First St NE
Minneapolis, MN 55413
Attention: Becky Rom, Vice President
If to Buyer: Greater Metropolitan Housing Corporation
15 South Fifth Street, Suite 710
Minneapolis, MN 55402
Attention: Carolyn Olson
Notices shall be deemed effective on the earlier of the date of receipt or the date of deposit as
aforesaid; provided, however, that if notice is given by deposit, then the time for response to any
notice by the other party shall commence to run one business day after any such deposit. Any
party may change its address for the service of notice by giving written notice of such change to
the other party, in any manner above specified, three days prior to the effective date of such
change.
SECTION 21. MISCELLANEOUS PROVISIONS
(a) Entire Agreement. This Agreement constitutes the entire agreement between the
parties hereto with respect to the transaction and it supersedes all prior
understandings or agreements between the parties hereto.
(b) Bindin Eg ffect. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns.
(c) Survival. All the terms, covenants, agreements, representations and warranties
made by the parties in this Agreement or in any document or instrument delivered
by the parties pursuant to this Agreement shall survive this Agreement and the
closing, and are not merged into any deed to be delivered by Seller to Buyer, and
shall remain enforceable under the terms of this Agreement.
(d) Waiver; Modification. The failure by either party to enforce its rights hereunder
shall not constitute a waiver of said party's right to demand future performance of
the provisions hereof. No modification or extension. of this Agreement shall be
binding unless in writing and signed by the parties.
(e) Time of Essence. Time is of the essence of this Agreement and each of its
provisions.
361662v3 MJM RC125-296 G-13
3-32
(fj Governing. This Agreement shall be governed by and .construed in
accordance with the laws o~the State of Minnesota.
(g) Assignment. This Agreeny`ient shall not be assigned by either party without the
prior written consent of ,the other, which consent shall not be unreasonably
withheld.
(h) Section Headings. The ~ section headings used in this Agreement are for
convenience or reference ollnly and shall not be deemed to vary the content of this
Agreement or its covenan ~s, agreements, representations and warranties or limit
the provisions or scope of ~ny section.
(i) Subsequent Documentation. Each of the parties hereto agrees to execute and
deliver to the other party, as requested, any additional documents and/or
instruments that may reasonably be determined as necessary to consummate the
transaction.
(j) Wells. At closing Seller shall provide Buyer with a statement regarding any wells
that are located on the Pr perty, as required by Minn. Stat. § 103I.235. If any
wells are located on the roperty, Seller shall cause the existing well on the
Property to be sealed an capped in accordance with all applicable laws and
regulations prior to closingl.
361662v3 MJM RC125-296 I G-14
~~-33
IN WITNESS WHEREOF, the parties have executed this Agreement to be effective as
of the day and year first above written:
BUYER:
GREATER METROPOLITAN HOUSING
CORPORATION, a Minnesota nonprofit
corporation
By:
Carolyn Olson
Its: President
361662v3 MJNI RC125-296 G-15
aA-3~
SELLER:
TWIN CITIES COMMUNITY LAND
BANK, LLC, a Minnesota nonprofit limited
liability company
By:
Becky Rom
Its: Vice Chair
361662v3 MJM RC125-296 G-16
~~~
EXHIBIT A TO PURCHASE AGREEMENT
LEGAL DESCRIPTION
PERMITTED ENCUMBRANCES
The following shall be permitted encumbrances on the title to the Property:
(a) governmental regulations, if any, affecting the use and occupancy of the Property;
(b) zoning laws of the City, County, and State;
(c) all rights in public highways upon the land;
(d) easements for public rights-of--way and public and private utilities;
(e) reservations to the State, in trust for the taxing districts concerned, of minerals and mineral rights in those
portions of the Property the title to which may have at any time heretofore been forfeited to the State for
nonpayment of real estate taxes;
(f) the lien of unpaid special assessments, if any, not presently payable but to be paid as a part of the annual
taxes to become due; and
(g) the lien of unpaid real estate taxes, if any, not presently payable but to be paid as a part of the annual taxes
to become due.
361662v3 MJM RC125-296 G-17
~/~ ~~
EXHIBIT B to Purchase Agreement
CONTRACT FOR PURCHASE;OF FIRST LOOK PROGRAM PROPERTY
361662v3 MJM RC125-296 G-1 g
~A- ~7
Neighborhood Stabilization Program
Purchase Agreement Addendum
Non-Eminent Domain Entity Purchase
This Neighborhood Stabilization Program Addendum (Addendum) is to be made part of the
Purchase Agreement (Agreement) dated 20_, between
(Seller) and
(Buyer), for the property located at:
MN, (the
Property).
A. Purchase Discount
The Buyer's obligation to close this transaction with federal assistance is expressly contingent
upon the results of an appraisal ordered by Hennepin County. The Buyer is using certain federal
funds that require the purchase price to be at or below 99 percent of the appraised value on the
appraisal ordered by Hennepin County. The Buyer shall be allowed 10 days after the date of this
Agreement to cancel based on the appraisal if the condition cannot be met, in which event this
Agreement will be null and void and the Seller shall return all earnest money to the Buyer.
B. Environmental Review
Notwithstanding any provision of this Agreement, the parties hereto agree and acknowledge that
this Agreement does not constitute a commitment of funds or site approval, and that such
commitment of funds or approval may occur only upon satisfactory completion of an
environmental review and receipt by Hennepin County under 24 CFR Part §58. The parties
further agree that the provision of any fund to the purchase is conditioned on Hennepin County's
determination to proceed with, modify or cancel the purchase based on the results of said
environmental review. Further, the buyer shall not undertake or commit any funds to physical or
choice-limiting actions, including property acquisition, demolition, movement, rehabilitations,
conversion, repair, construction, or execution of a construction contract prior to the
environmental clearance, as denial of any funds to purchase may result.
C. Disclosure to Seller with Voluntary, Arm's Length Purchase Offer
This is to inform you the Buyer would like to purchase the property under this Agreement to
owner occupy, if a satisfactory agreement can be reached. This purchase may receive funding
assistance from the U.S. Department of Housing and Urban Development (HUD).
Please be advised that the Buyer does not have authority to acquire your property by eminent
domain. In the event we cannot reach an amicable agreement for the purchase of your property,
the Buyer will not pursue this proposed acquisition.
Seller's Initials
Buyer's Initials
361662v3 MJM RC125-296 G-19
~I~-3~
The property is listed for purchase at ($;
you ($) to
property under the conditions described
amount represents the current market va
purchase foreclosed property at a discoun
results of our appraisal, our final purchase
The Buyer is prepared to offer
purchase your property and receive clear title to the
in the attached Agreement. The Buyer believes this
ue of your property. Under NSP, we are required to
t from is current appraised value. Depending upon the
offer may offer from the amount noted above.
Since the purchase would be a voluntary ~.cquisition, arm's length transaction, you would not be
eligible for relocation payments or other relocation assistance in accordance with the Uniform
Relocation Assistance and Real Property acquisition Policies Act (URA).
In accordance with the Uniform Relocation Assistance and Real Property Acquisition Policies
Act (URA), owner-occupants who move as a result of a voluntary acquisition are not eligible for
relocation assistance. Atenant-occupant who moves as a result of a voluntary acquisition for a
federally-assisted project may be eligible for relocation assistance. Such displaced persons may
include not only current lawful occupa s, but also former tenants required to move for any
reason other than an eviction for cause n accordance with applicable federal, state, and local
law. If your property is currently te~ant-occupied or a tenant lawfully occupied your
property on or after February 17, 2009, we need to know immediately. Further, you should
not order current occupant(s) to move, or fail- to renew a lease, in order to sell the property to us
as vacant. Also, as indicated in the cont act of sale, this offer is made on the condition that no
tenant will be permitted to occupy the pro erty before the sale is complete.
Again, if you do not wish to sell the property, the Buyer will take no further action to acquire it.
If you are willing to sell the property under the conditions described in this Agreement, please
sign the Agreement and initial this Addendum. Your signature on the Agreement and your
initials on this Addendum constitute acknowledgement that you have received this disclosure.
Please contact the Buyer if you have any uestions about this disclosure.
D. Minimum Property Standards i
Seller shall allow the Buyer to complete Ian inspection of the property within 10 days after the
date of this Agreement to establish if the'IIproperty will meet the Hennepin Housing Consortium
New Construction and. Rehabilitation Standards (Standards). If the Buyer determines that the
property does not. meet the Standards, the Buyer shall have the right to cancel this Agreement, in
which event, this Agreement will be null d void and the Seller shall return all earnest money to
the Buyer.
Seller's Initials
Buyer's Initials
361662v3 MJM RC125-296 G-2~
I.
EXHIBIT H
CERTIFICATIONS REGARDING LOBBYING AND DEBARMENT
CERTIFICATION REGARDING LOBBYING
Before HRA releases any of the funds covered by this Agreement, GMHC shall sign the
following certification .statement in accordance with the requirements of 24 CFR
570.611, 24 CFR 85.36, and 24 CFR 84.42:
The undersigned .hereby certifies, to the best of his or her knowledge and belief, that:
(1) NO FEDERAL APPROPRIATED FUNDS HAVE BEEN PAID, OR WILL
BE PAID, BY OR ON BEHALF OF THE UNDERSIGNED, TO ANY
PERSON FOR INFLUENCING OR ATTEMPTING TO INFLUENCE AN
OFFICER OR EMPLOYEE OF AN AGENCY, A MEMBER OF
CONGRESS, AN OFFICER OR AN EMPLOYEE OF CONGRESS, OR AN
EMPLOYEE OF A MEMBER OF CONGRESS IN CONNECTION WITH
THE AWARDING OF ANY FEDERAL CONTRACT, THE MAKING OF
ANY FEDERAL GRANT, THE MAKING OF ANY FEDERAL LOAN,
THE ENTERING INTO OF ANY COOPERATIVE AGREEMENT, AND
THE EXTENSION, CONTINUATION, RENEWAL, AMENDMENT, OR
MODIFICATION OF ANY FEDERAL CONTRACT, GRANT, LOAN, OR
COOPERATIVE AGREEMENT.
(1) IF ANY FUNDS OTHER THAN FEDERAL APPROPRIATED FUNDS
HAVE BEEN PAID OR WILL BE PAID TO ANY PERSON FOR
INFLUENCING OR ATTEMPTING TO INFLUENCE AN OFFICER OR
EMPLOYEE OF AN AGENCY; A MEMBER OF CONGRESS, AN
OFFICER OR AN EMPLOYEE OF CONGRESS, OR AN EMPLOYED OF
A MEMBER OF CONGRESS IN CONNECTION WITH THIS FEDERAL
CONTRACT, GRANT, LOAN, OR COOPERATIVE AGREEMENT, THE
UNDERSIGNED SHALL COMPLETE AND SUBMIT STANDARD FORM
LLL, "DISCLOSURE FORM TO REPORT LOBBYING," IN
ACCORDANCE WITH ITS INSTRUCTIONS.
(2) THE UNDERSIGNED SHALL REQUIRE THAT THE LANGUAGE OF
THIS CERTIFICATION BE INCLUDED 1N THE AWARD DOCUMENTS
ALL SUB-AWARDS AT ALL TIERS (INCLUDING SUB-CONTRACTS,
SUB-GRANTS, AND CONTRACTS UNDER GRANTS, LOANS, AND
COOPERATIVE AGREEMENTS) AND THAT ALL SUB-RECIPIENTS
SHALL CERTIFY AND DISCLOSE ACCORDINGLY.
361662v3 MJM RC125-296 H-1
~ -~o
This certification is a material r~
when this transaction was made
prerequisite for making or enteri
31, U.S. Code. Any person who f
civil penalty of not less than $10,(
~sentation of fact upon which reliance was placed
entered into. Submission of this certification is a
into this transaction imposed by section 1352, title
to file the required certification shall be subject to a
and not more than $100,000 for each such failure.
IN WITNESS WHEREOF; I have set my hand this
(date)
BY:
Title:
FOR:
(organization)
II. CERTIFICATION l
Before HRA releases any of thefiands covered by this Agreement, GMHC shall sign the
following certification statement:
Certification Regarding Debarment, Suspension, and
Other Responsibility Matters Primary Covered Transactions
This certification is required by ~he regulations implementing Executive Order 12549,
Debarment and Suspension, 29 C~R Part 98, § 98.510, Participants' responsibilities. The
regulations were published as Part VIII of the May 26, 1988 Federal Register (pages
19160 -1921 1).
AS THE DULY AUTHORIZED REP
THE BEST OF MY KNOWLEDGE
NOR ANY OF THE PRINCIPALS:
(1) ARE PRESENTLY DEBAI
DECLARED INELIGIBLE,
TRANSACTIONS BY ANY
(2) HAS, WITHIN ATHREE-YEAP
CONVICTED OF, OR HAD A C
COMMISSION OF FRAUD OR
WITH OBTAINING, ATTEMP'
(FEDERAL, STATE OR LOC,
PUBLIC TRANSACTION; VIC
STATUTES OR COMMISSIC
BRIBERY, FALSIFICATION O]
STATEMENTS, OR RECEIVING
fTATIVE OF THE APPLICANT, I CERTIFY, TO
BELIEF, THAT NEITHER THE APPLICANT
SUSPENDED, PROPOSED FOR DEBARMENT,
VOLUNTARILY EXCLUDED FROM COVERED
?RAL DEPARTMENT OR AGENCY.
PERIOD PRECEDING THIS APPLICATION, BEEN
VIL JUDGMENT ENTERED AGAINST THEM FOR
OTHER CRIMINAL OFFENSE IN CONNECTION
ING TO OBTAIN, OR PERFORMING A PUBLIC
.L) TRANSACTION OR CONTRACT UNDER A
~ATION OF FEDERAL OR STATE ANTITRUST
v OF EMBEZZLEMENT, THEFT, FORGERY,
.DESTRUCTION OR RECORDS, MAKING FALSE
STOLEN PROPERTY.
361662v3MJMRC125-296 H-2
~~-~l
(3) IS PRESENTLY INDICTED FOR OR OTHERWISE CRIMINALLY OR CIVILLY
CHARGED BY A GOVERNMENTAL ENTITY (FEDERAL, STATE OR LOCAL)
WITH COMMISSION OF ANY OF THE OFFENSES ENUMERATED IN
PARAGRAPH (2) (B) OF THIS CERTIFICATION, AND
(4) HAS NOT, WITHIN ATHREE-YEAR PERIOD PRECEDING THIS APPLICATION,
HAD ONE OR MORE PUBLIC TRANSACTIONS (FEDERAL, STATE OR LOCAL)
TERMINATED FOR CAUSE OR DEFAULT.
(5) WHERE THE APPLICANT IS UNABLE TO CERTIFY TO ANY OF THE
STATEMENTS IN THIS CERTIFICATION, HE OR SHE SHALL ATTACH AN
EXPLANATION TO THIS APPLICATION.
(6) THE UNDERSIGNED SHALL REQUIRE THAT THE LANGUAGE OF THIS
CERTIFICATION BE INCLUDED IN ALL SUBCONTRACT AWARDS PURSUANT
TO THIS CONTRACT AND AGREES TO REQUIRE ANY SUCH SUB-
CONTRACTORS TO SIGN A DEBARMENT CERTIFICATION.
(Name and Title of Authorized
Representative)
(Signature)
361662v3 MJM RC 125-296 H-3
AGENDA ITEM # 3$
REPORT # 50
J STAFF REPORT
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING
DECEMBER 21, 2009
REPORT PREPARED BY:
REPORT PRESENTER:
DEPARTMENT DIRECTOR REVIEW:
REVIEWED BY EXECUTNE DIRECTOR:
JULIE URBAN/MICHELLE LEWIS, HOUSING
SPECIALIST
NAME, TITLE
JOHN STARK, COMMUNITY DEVELOPMENT
DIRECTOR
ITEM FOR HRA CONSIDERATION:
Consideration of a First Look Program Acquisition Agreement and an Access and
Indemnification Agreement with the Twin Cities Community Land Bank LLC for the acquisition
of foreclosed propert .
I. RECOMMENDED ACTION:
By Motion: Approve and authorize execution of a First Look Program
Acquisition Agreement and an Access and Indemnification
Agreement (subject to minor revisions by legal counsel) with the
Twin Cities Community Land Bank LLC for the acquisition of
foreclosed aroaertv.
II. BACKGROUND
The National Community Stabilization Trust (NCST) facilitates the transfer of
foreclosed and abandoned properties from financial institutions nationwide to local
housing organizations through its First Look Program. The Greater Metropolitan
Housing Corporation (GMHC) was originally. identified as the community coordinator
for this program, and in October 2009 the HRA approved an agreement with GMHC
to use the First Look Program to acquire foreclosed homes where possible. Since
that time, the Twin Cities Community Land Bank LLC (TCCLB) has taken over the
role as the community coordinator. Anew agreement with TCCLB is needed to
122109 TCCLB First Look agreement.doc
enable the Housing and Redevelopment Authority (HRA) to acquire foreclosed
homes through the First Look Program. In addition, TCCLB requires entities
choosing to participate in the program to sign an Access and Indemnification
Agreement in order to enter the homes.
III. BASIS OF RECOMMENDATION
A. POLICY
• It is a goal of the HRA to strengthen and improve neighborhoods and
the housing stock. Neighborhoods in which there are one or more
foreclosed and vacant homes have detrimental impacts on the
surrounding property values.
• In collaboration with state and local governments, NCST builds local
capacity to effectively acquire, manage, rehabilitate and sell
foreclosed property to ensure homeownership and rental housing are
available to low and moderate income families.
B. CRITICAL ISSUES
• The market of vacant and foreclosed properties is moving very quickly
and participation in the First Look Program offers the opportunity to
purchase properties before they are listed on the MLS.
• Participation in the First Look Program provides an opportunity to use
federal Neighborhood Stabilization Program (NSP) funds to purchase
foreclosed properties. NSP funds must be committed by September
20, 2010.
• NCST has relationships with eleven lenders nationwide to list
foreclosed properties through the First Look Program before putting
them up for sale on the open market.
• The HRA will have first priority to purchase any property listed by
NCST, followed by GMHC (which is partnering with the HRA to
purchase and rehabilitate properties using NSP funds). In addition,
the HRA can grant permission to other non-profits and developers to
purchase property through NCST.
• TCCLB requires all participating entities to agree to defend, indemnify
and hold TCCLB harmless from any claims made against TCCLB in
connection with HRA inspection of the properties.
C. FINANCIAL
• TCCLB charges non-profits, such as GMHC, a fee of $1,500 to
purchase distressed property through the First Look Program. NSP
funds will cover this expense when GMHC purchases a property on
the HRA's behalf.
• TCCLB charges a fee of $2,000 to Housing and Redevelopment
Authorities to purchase distressed property through the First Look
Program. In the event the HRA purchases a property for the Richfield
Rediscovered or New Home programs, there are adequate funds
available to cover these costs.
• The HRA was awarded a total of $1,041,541 in Federal NSP funds;
currently $750,000 is allocated to purchase and rehabilitate foreclosed
houses. NSP funds must be under contract prior to September 20,
2010. Failure to expend the NSP funds by September 20, 2010 will
result in forfeiture of the funds.
D. LEGAL
• Legal counsel has reviewed both agreements.
IV. ALTERNATIVE RECOMMENDATION(S~
• Do not approve the Acquisition Agreement and Access and Indemnification
Agreement.
V. ATTACHMENTS
• Access and Indemnification Agreement
• First Look Program Acquisition Agreement
VI. PRINCIPAL PARTIES EXPECTED AT MEETING
• N/A
~~~-i
ACCESS AND INDEMNIFICATION AGREEMENT
This ACCESS AND INDEMNIFICATION AGREEMENT ("Agreement") is made
this day of December, 2009 ("Effective Date"), by and between TWIN .CITIES
COMMUNITY LAND BANK LLC, a Minnesota nonprofit limited liability company
("TCCLB") whose address is 615 First Avenue NE, Suite 410, Minneapolis, Minnesota 55413,
and 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
("HRA") whose address is 6700 Portland Avenue, Richfield, Minnesota 55423.
RECITALS
WHEREAS, TCCLB and certain qualified sellers consisting of lenders and servicers
("Sellers") as owners of certain foreclosed and abandoned properties located in certain
economically distressed neighborhoods in the greater Minneapolis and St. Paul metropolitan area
which are heavily affected by the foreclosure crisis ("Targeted Communities") are participants in
the Real Estate Owned Purchase Program (the "Program") of the National Community
Stabilization Trust ("NCST");
WHEREAS, pursuant to the Program, TCCLB is provided with (a) a right of first offer
to purchase real estate owned properties ("REO Properties") located in the Targeted
Communities from Seller prior to the traditional marketing and listing for sale of such REO
Properties("First Look Program") and/or (b) a bulk aged REO Property purchase program for
purchasing significant numbers of currently-listed properties ("Bulk and Aged Property
Program" and collectively with the First Look Program shall be referred to as the "Program") all
of which REO Properties are located in the Targeted Communities;
WHEREAS, the certain Program guidelines and agreements ("Program Guidelines")
agreed to by TCCLB and by the Sellers provide TCCLB with an opportunity and limited right to
access and inspect certain REO Properties identified through NCST prior to the execution of a
Purchase and Sale Agreement;
WHEREAS, the Program contemplates the re-sale by TCCLB of certain of the REO
Properties to HRA and HRA has expressed an .interest in purchasing certain of the REO
Properties ("Identified Properties"), and TCCLB and HRA intend to execute a First Look
Program Acquisition Agreement for the purpose of purchasing Identified Properties
("Acquisition Agreement");
WHEREAS, TCCLB signed a Memorandum of Understanding with NCST dated August
28, 2009, that, among other things, designates TCCLB as a Community Coordinator and
provides that TCCLB "may delegate the inspection and due diligence roles to Community
Partners, provided if such persons shall agree to indemnify and hold the Community Coordinator
and [NCST] harmless with respect to claims or liability caused by their inspection and due
diligence activities";.
361506v3 MJM RC125-296
~~-a
WHEREAS, TCCLB desires to assign to HRA its rights to access and inspect the
Identified Properties subject to the undertakings and indemnification herein provided and HRA's
desire to accept such assignment;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties agree as follows:
1. Assignment of Right to Access and Inspect. Subject to the conditions
hereinafter contained, TCCLB hereby assigns, permits, and delegates to HRA, and HRA hereby
accepts, TCCLB's rights to enter upon and access and to inspect the Identified Properties
pursuant to the Program Guidelines. HRA may not assign and delegate its rights under this
Agreement without TCCLB's prior written permission.
2. Indemnification. In consideration for TCCLB's assignment of its rights to
inspect the Identified Properties and other consideration, including the right to purchase certain
of the Identified Properties pursuant to the Acquisition Agreement, HRA hereby agrees to
indemnify and fully protect, defend, and hold TCCLB, its officers, directors, employees,
shareholders, servicers, representatives, agents, attorneys, tenants, brokers, successors or assigns
harmless from and against any and all claims, costs, liens, loss, damages, attorney's fees and
expenses of every kind and nature that may be sustained by or made against H1ZA, its officers,
directors, employees, shareholders, representatives, agents, attorneys, tenants, brokers,
successors or assigns, based on the negligence or willful misconduct of the HRA, its officers,
directors, employees, representatives, agents, attorneys, successors or assigns, resulting from or
arising out of (a) the entry upon and (b) inspection of the Identified Properties by the H12A, or its
employees, officers, agents or its permitted successors or assigns except for claims, costs, liens,
loss, damages, attorney's fees and expenses of every kind and nature that may be sustained by or
made against HRA, its officers, directors, employees, shareholders, representatives, agents,
attorneys, tenants, brokers, successors or assigns that are the direct result of actions by TCCLB,
its officers, directors, employees, shareholders, servicers, representatives, agents, attorneys,
tenants, brokers, successors or assigns, which shall be the responsibility of TCCLB.
3. Insurance Requirements. HRA shall maintain during the term of this
Agreement comprehensive general liability insurance with minimum limits of $1,000,000 per
occurrence and $3,000,000 in the aggregate. Upon request, HRA shall provide a certificate of
insurance evidencing such coverage. As to any claim against HRA for which indemnity is
required, the certificate of insurance will name TCCLB as an additional insured. The certificate
of insurance shall also state that the insurer shall provide written notice to TCCLB of
cancellation or material change in the insurance coverage stated on the certificate not less than
30 days prior to the cancellation or change of coverage. Nothing in this Agreement is intended to
constitute a waiver or limitation on of any immunities and privileges from liability or limits on
liability set forth in Minnesota Statutes, Chapter 466, or otherwise.
4. Costs of Inspection and Appraisals. HRA shall be responsible for paying all
costs resulting from its access to and inspection, such as, but not limited to inspection and
appraisals costs, of the REO Properties. In addition, HRA shall be responsible for paying the
costs of any appraisals or broker price opinions ordered by HRA.
361506v3 MJM RC125-296
2
3-~-~
5. Term. The term of this Agreement shall .commence on the Effective Date and
shall continue until December 31, 20.10 unless sooner terminated pursuant to Paragraph 6 below.
Any sections of this Agreement which are intended by their terms to continue after termination
survive the expiration or earlier termination of this Agreement.
6. Termination. Either party may terminate this Agreement at its discretion and
without further obligation: (a) immediately if the other party breaches this Agreement and fails to
cure such breach within five (5) business days of written notice of default, or (b) at any time
upon ten (10) days written notice to the other party. Upon termination, all unpaid fees owed to
TCCLB or any third party by HRA shall be immediately due and payable.
7. Independent Contractor. HRA will at all times act as an independent entity and
nothing contained herein will be construed to create the relationships ofjoint-venturers, agency
or employer and employee between the parties. HRA shall be responsible for the manner and
means of performing its services under this Agreement and said manner and means are subject to
the HI2A's sole control. HRA shall be responsible for all state, federal, and local taxes, including
estimated taxes, social security, disability insurance, if any, and any other similar form of
payments, as well as all employment reporting, for the HR.A and any of the H1ZA's employees or
agents.
8. Representation and Warranty. TCCLB represents and warrants that it has the
full power and authority to assign its right to enter upon and access and to inspect the Identified
Properties and that this Agreement constitutes a valid assignment.
9. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall constitute but one and
the same instrument.
10. Entire Agreement. This Agreement contains the entire agreement of the parties
regarding the subject matter of this Agreement, and there are no other promises or conditions in
any other agreement, whether oral or written. This Agreement may only be .amended by a
written instrument signed by both parties.
11. Severability. If any provision of this Agreement shall be held to be invalid or
unenforceable for any reason, the remaining provisions shall continue to be valid and
enforceable. If a court finds that any provision of this Agreement is invalid or unenforceable, but
that by limiting such provision it would become valid and enforceable, then such provision shall
be deemed to be written, construed, and enforced as so limited.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the Effective Date first above written.
361506v3 MJM RC 125-296
3s- ~
TWIN CITIES COMMUNITY LAND
BANK LLC,
a Minnesota nonprofit limited liability
company
By: By:
Its: Its:
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
By:
Its:
Executive Director
Chairperson
[Signature Page for Access and Indemnification Agreement]
361506v3 MJM RC125-296
4
~~F~
FIRST LOOK PROGRAM
ACQUISITION AGREEMENT
(NSP I)
THIS FIRST LOOK PROGRAM ACQUISITION AGREEMENT ("Agreement") is
made as of this day of December, 2009 ("Effective Date"), by and between the Twin
Cities Community Land Bank LLC, a Minnesota nonprofit limited liability company
("TCCLB"), and the Housing and Redevelopment Authority in and for the City of Richfield
("City"), a public body corporate and politic under the laws of the State of Minnesota ("HRA").
RECITALS
A. Title III of Division B of the Housing and Economic Recovery Act of 2008 (Pub. L 110-
289, 1222 Stat. 2654 enacted July 30, 2009), as amended by the American Recovery and
Reinvestment Act of 2009, H.R. 1 (the "Act") makes available to qualified entities certain
qualified grant funds termed Neighborhood Stabilization Program funds ("NSP I Funds")
under the FY08 CDBG Neighborhood Stabilization Program ("NSP I").
B. Hennepin County ("County") received a grant of NSP I Funds directly from the United
States Department of Housing and Urban Development ("HUD") and was a recipient of
funds the State of Minnesota Housing Finance Agency ("MHFA") received directly from
HUD, both under the Act.
C. HRA applied for and obtained NSP I Funds from County in an amount not to exceed
$1,041,541.00 ("NSP I Award") within certain approved areas of the City ("NSP Eligible
Area"), as set forth in HRA's agreement with County for the NSP I Award dated March
20, 2009 ("Subrecipient Agreement").
D. HRA has awarded and/or will award NSP I Award to certain developers ("NSP I
Developers") under its Foreclosure Recovery Program for the purposes of (i) purchasing
and rehabilitating properties that have been foreclosed upon or abandoned ("Category B
Properties"), which constitute an eligible use of NSP I Funds pursuant to § 2301(c)(3)(B)
of the Act ("Eligible Use Category B"), and (ii) redeveloping demolished or vacant
properties ("Category E Properties"), which constitute an eligible use of NSP I Funds
pursuant to § 2301(c)(3)(E) of the Act ("Eligible Use Category E").
E. As of the date of this Agreement, HRA has approved the use of $750,000.00 for the
purchase, rehabilitation, and resale of four Eligible Use Category B properties within the
NSP Eligible Area; however, HRA reserves the right to approve additional funds for the
purchase, rehabilitation, and resale of additional Eligible Properties under the terms of
this Agreement.
F. HRA also is undertaking to establish financing mechanisms for the purchase and
redevelopment of foreclosed upon property, which constitute an eligible use of NSP I
Funds pursuant to § 2301(c)(3)(A) of the Act.
~J'' ~f'
G. Under NSP I, properties must have been foreclosed upon to qualify for NSP I assistance
under the Act and must have been abandoned or foreclosed upon to qualify for NSP I
assistance under the Act. Category B Properties and Category E Properties shall be
individually referred to as "Eligible Property" and collectively referred to as "Eligible
Properties".
H. On April 23, 2009, HUD issued a document titled "Guidance on NSP I-Eligible
Acquisition and Rehabilitation Activities" that clarifies the use of intermediaries for
acquisitions under NSP I (the "HUD Guidance").
I. The parties shall be working with the National Community Stabilization Trust ("NCST")
and participating sellers under a program called "First Look" ("First Look Program")
which allows TCCLB to purchase Eligible Properties prior to such Eligible Properties
being placed on the open market using standardized transaction formats and pricing
models to facilitate a significant purchase price adjustment for the benefit of TCCLB.
TCCLB has signed a Memorandum of Understanding ("NCST MOU") with NCST and
have agreed to the Acquisition Program Guidelines issued by NCST, which is attached to
this Agreement as Exhibit A.
K. TCCLB intends to offer for sale certain Eligible Properties it acquires pursuant to the
First Look Program to HRA and NSP I Developers, among others, and to retain certain
Eligible Properties it acquires pursuant to the First Look Program for its own acquisition
and rehabilitation program.
L. The purpose of this Agreement is to satisfy the requirements in 24 CFR 570.203 and the
HUD Guidance so that Eligible Properties acquired by TCCLB and purchased by HRA or
NSP I Developers retain their eligibility for NSP I Funds.
M. Capitalized terms used and not defined in this Agreement shall have the meaning set forth
in that certain NSP I Notice published in the Federal Register on October 6, .2008.
N. As required by paragraph five of the Subrecipient Agreement, County provided its prior
consent to this Agreement.
AGREEMENT
1. Scope of Work. HRA hereby designates TCCLB as an NSP I Subrecipient to carry out
acquisition of Eligible Properties through the First Look Program and in accordance with
the terms and conditions of this Agreement.
2. Term. This Agreement will be effective as of the Effective Date and terminate on
December 31, 2010.
3. Eligible Areas. The map attached to this Agreement as Exhibit B identifies the areas
determined by MHFA to be HRA's areas of greatest need.
2
3~?~
4. Other Criteria. HRA shall provide TCCLB with its criteria for Eligible Properties it
would like TCCLB to acquire under the First Look Program and offer to HRA for
rehabilitation under the Foreclosure Recovery Program, such as location, quality, price
and level of needed repairs. It is intended that HRA or each NSP I Developer shall
provide TCCLB with its criteria for Eligible Properties it would like TCCLB to acquire
under the First Look Program and offer to NSP I Developers for rehabilitation under the
Foreclosure Recovery Program, such as location, quality, price and level of needed
repairs.
5. Timing. Any properties acquired by TCCLB prior to the Effective Date of this
Agreement ("Prior Acquired Properties") are not eligible for NSP I Funds under Eligible
Use Category A, or Eligible Use Category B. However, the HUD Guidance indicates that
such Prior Acquired Properties may be eligible for rehabilitation under Eligible Use
Category E if HUD grants an exception. Because properties rehabbed under Eligible Use
Category E do not count toward satisfaction of HRA's obligation to expend at least
twenty-five percent (25%) of its NSP I Award to house individuals or families whose
incomes do not exceed fifty percent (50%) of the area median income, HRA must pre-
approve the use by or transfer to an NSP I Developer any vacant property ineligible for
funding under Eligible Use Category B.
6. URA. TCCLB will cause each NSP I Developer to comply with applicable acquisition
and relocation requirements in the Uniform Relocation Act ("URA") and implementing
regulations at 49 CFR Part 24, including, without limitation, the voluntary acquisition
provisions at 49 CFR 24.101(b)(1). Among other things, the URA and 49 CFR Part 24
require TCCLB to document delivery of an informational notice in substantially the form
attached to this Agreement as Exhibit C (HUD Guideform: NSP Voluntary Acquisition
of Foreclosed Property) to each property owner. TCCLB will acquire only unoccupied
properties under the NCST Program and shall certify that its acquisition of any Eligible
Property did not cause a tenant displacement (as described in the URA). Further, with
respect to any property foreclosed after February 17, 2009, TCCLB must obtain
certification from the foreclosing lender that it complied with the new tenant protections
in the American Recovery ,and Reinvestment Act of 2009 and the Protecting Tenants at
Foreclosure Act of 2009 in the form attached as Exhibit D ("PTFA Certification").
7. Purchase Discount. TCCLB shall cause each NSP I Developer to obtain aURA-
compliant appraisal (49 CFR 24.103) through County dated within sixty (60) days before
the final offer, which under the NCST MOU is the date of closing of any applicable
Eligible Property, and obtain a discount from the Current Market Appraised Value for
each Eligible Property of at least one percent (1 %). If the anticipated value of the
Eligible Property is $25,000 or less and the acquisition is voluntary, review of available
data by a person qualified to make the valuation maybe substituted for an appraisal.
8. Environmental Review. Prior to a commitment of NSP I funds or "choice-limiting
action" as described in the environmental regulations at 24 CFR Part 58, HRA will
undertake the appropriate environmental review procedures and documentation as
determined, requested, or required by the County.
~~- 8
9. Activity Delivery Costs. TCCLB may incur. staff and overhead costs directly related to
carrying out the acquisition activities under this Agreement. Such costs may include but
are not .limited to the cost of surveys, appraisals, .preparation of legal ..documents,
recording fees and .temporarily. managing Eligible Properties ("Activity Delivery Costs"),
provided such costs are necessary and reasonable and otherwise conform with OMB
Circular A-122 Cost Principles for Nonprofit Organizations.
10. Distribution. It is the .intent of the parties that Eligible Properties acquired pursuant to
this Agreement will retain their Foreclosed status through any subsequent sales or
transfers to HRA and/or NSP I Developers. TCCLB will follow the procedures attached
to this Agreement as Exhibit E (Acquisition .Process) and offer the Eligible Properties in
the following manner:
(a) To HRA:
(i) Purpose -Eligible Use Category B and E;
(ii) Eligible Areas -Exhibit B;
(iii) Sale Price -Pass through cost of acquisition by TCCLB of the Eligible
Property plus a $2,000.00 transaction fee per Eligible Property, plus all
actual out-of-pocket Activity Delivery Costs incurred by TCCLB in
connection with TCCLB's acquisition and closing of the purchase of the
Eligible Property under the First Look Program;
(iv) Priority -TCCLB will give HRA first priority in the selection of Eligible
Properties off each First Look Program property list provided to TCCLB
for acquisition; and
(v) Purchase Agreement - HRA and TCCLB will enter into a purchase
agreement in substantially the form attached to this Agreement as Exhibit
F (Form Purchase Agreement) for each Eligible Property or group of
Eligible Properties that HRA, from time to time, agrees to acquire from
TCCLB under this Agreement.
(b) To NSP I Developers:
(i) Purpose - Eligible Use Category B and E Foreclosure Recovery
Rehabilitation Program;
(ii) Eligible Areas -Exhibit B;
(iii) Sale Price -Pass through cost of acquisition by TCCLB of the Eligible
Property plus a $1,500.00 transaction fee per Eligible Property and all
actual out-of-pocket Activity Delivery Costs incurred by TCCLB in
connection with TCCLB's acquisition and closing of the purchase of the
Eligible Property under the First Look Program;
4
`~~~ - 1
(iv) Priority -TCCLB will give NSP I Developers who are acquiring
properties from TCCLB for purposes of rehabilitation under the
Foreclosure Recovery Program second priority in the selection of Eligible
Properties off each First Look Program property list provided to TCCLB
for acquisition. If more than one NSP I Developer wants to acquire or
TCCLB desires to retain an Eligible Property, a lottery system will be
used to determine which NSP I Developer shall acquire such Eligible
Property or if TCCLB shall retain such Eligible Property; and
(v) Purchase Agreement -TCCLB shall enter into a purchase agreement with
NSP I Developer in substantially the form of the Form Purchase
Agreement for each Eligible Property or group of Eligible Properties that
NSP I Developers, from time to time, agree to acquire from TCCLB.
11. Documentation. TCCLB shall maintain the following records and reports relating to each
Eligible Property acquired pursuant to this Agreement: (a) appraisal,. (b) NSP I
informational notice offer letter, (c) PTFA Certification, (d) NSP I Developer Access and
Indemnity Agreement, (e) environmental reports, (f) purchase agreement, (g) settlement
statement, and (h) deed document number/filing information. TCCLB shall submit
copies of the foregoing documentation, except the NSP I Developer Access and
Indemnity Agreement, to HRA with respect to any Eligible Property acquired pursuant to
this Agreement.
12. Program Income. The parties do not anticipate that TCCLB will receive any "program.
income," as defined in 24 CFR 570.500, in connection with the transactions contemplated
by this Agreement. However, if TCCLB ever receives land sale proceeds in excess of its
acquisition costs, including any Activity Delivery Costs, TCCLB may retain the program
income, subject to 24 CFR 570.503 and 570.504.
13. Uniform Administrative Requirements. TCCLB shall comply with all applicable uniform
administrative requirements described at 24 CFR 570.502.
14. Other Program Requirements. TCCLB shall carry out the acquisition activities under this
Agreement in compliance with all federal laws -and regulations described at 24 CFR Part
570, subpart K. Notwithstanding anything to the contrary contained herein, TCCLB
expressly does not assume HRA's environmental responsibilities described in 24 CFR
570.604, and (ii) TCCLB expressly does not assume HRA's responsibility for initiating
the review process under the provisions of 24 CFR Part 52. TCCLB shall execute the
Certification Regarding Lobbying and Certification Regarding Debarment attached as
Exhibit G in conjunction with the execution of this Agreement.
15. Suspension and Termination. In accordance with 24 CFR 85.43, suspension or
termination of this Agreement may occur if TCCLB materially fails to comply with any
term of this Agreement, after notice and the opportunity to cure, -and this Agreement may
be terminated for convenience in accordance with 24 CFR 85.44.
5
~~8- ~ ~
16. Reversion of Assets. Upon the expiration or earlier termination of this Agreement,
TCCLB shall transfer to HRA all NSP I Awards in TCCLB's control or possession, if
any, and any accounts receivable attributable to the use of NSP I Award. Further, any
real property under TCCLB's control that was acquired or improved in whole or in part
with NSP I Award in excess of $25,000 shall be used or disposed of in a manner
consistent with 24 CFR 570.503(b)(7).
17. Notices. Any notice or demand which must be given or made by a party under this
Agreement or any statute or ordinance shall be in writing and, except as otherwise
provided in Exhibit E, shall be deemed to have been given or served on the date the same
is deposited in the United States Mail, registered or certified, postage prepaid and addressed
as follows:
To HRA: Housing and Redevelopment Authority
in and for the City of Richfield
6700 Portland Avenue
Richfield, MN 55423
Attn: Mr. John Stark, AICP, Director of Community Development
To TCCLB: Twin Cities Community Land Bank LLC
615 First Avenue NE, Suite 410
Minneapolis, MN 55413
Attn: Rebecca L. Rom
18. Data Practices. TCCLB agrees to abide by the provisions of the Minnesota Government
Data Practices Act and all other applicable State and Federal laws, rules, and regulations
relating to data privacy and confidentiality, and as any of the same may be amended.
19. Severability. The invalidity, illegality or enforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision of this
Agreement, all of which shall remain in full force and effect.
20. Assignment of Agreement. The parties shall not assign this Agreement without the
express written consent of the other party.
21. Modification. No provision, term or clause of this Agreement shall be revised, modified,
amended or waived except by an instrument in writing signed by both parties.
22. Counterparts. This Agreement may be executed in any number of counterparts and each
such counterpart shall be deemed to be an original, all of which, when taken together,
shall constitute one agreement.
23. Headings. The titles to the sections and headings of various paragraphs of this
Agreement are placed for convenience of reference only and in case of conflict, the text
of this Agreement, rather than such titles or headings shall control.
24. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit
of the successors and assigns of each of the parties hereto.
6
3,~-(I
25. Invalidity. If for any reason any portion or paragraph of this Agreement shall be declared
void and unenforceable by any court of law or equity, it shall only affect such particular
portion or paragraph of this Agreement, and the balance of this Agreement shall remain
in full force and effect and shall be binding upon the parties hereto.
26. Governing Law. This Agreement shall be governed and construed in accordance with the
laws of the State of Minnesota.
27. Obligations Limited. HRA's obligation to make payments under this Agreement is
limited entirely to NSP 1 Award funds being remitted to the HRA in sufficient amounts
and available for the purposes for which such payments are sought. HRA shall have no
obligation to make payments under this Agreement from sources other than the NSP 1
Award provided, however, that the HRA will not enter into a purchase agreement unless
it has been awarded sufficient NSP1 Award funds to complete the transaction.
IN WITNESS WHEREOF, the parties have hereunto set their hands the day and year first
above written.
(Signature pages follow.)
7
~~,-~a
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
By:
Name
Its:
Steven L. Devich
Executive Director
By:
Name: Suzanne M. Sandahl
Its: Chairperson
(Signature page to First Look Program Acquisition Agreement between Twin Cities Community
Land Bank LLC and Housing and Redevelopment Authority in and for the City of Richfield)
8
3~~-i3
TWIN CITIES COMMUNITY LAND BANK,
LLC, a Minnesota non-profit limited liability
company
By:
Rebecca L. Rom
Its: Vice Chair
(Signature page to First Look Program Acquisition Agreement between Twin Cities Community
Land Bank LLC and Housing and Redevelopment Authority in and for the City of Richfield)
9
3~~~~
EXHIBIT A
MEMORANDUM OF UNDERSTANDING WITH NCST AND
ACQUISITION PROGRAM GUIDELINES ISSUED BY NCST
[TO BE INSERTED]
Exhibit A
~~-i~
EXHIBIT B
MAP OF HIGH NEED AREA
'd Legena ~;r:H~i-i u
~ Hsrr ~~ y avr.
•1~• 'tJBF+I~cr3e~=
~ ®tJEN I~cr~ Cimrn
~~i75: k it l CikS i1147i1u have a HUL} IUECels~sue ~ r ~;k :v.:vr<: vl loss Ifx:~J ~.
Hennepin County Housing Community Works and Transit
Exhibit B
Richfield Target Area
3~-- ~~
EXHIBIT C
HUD GUIDEFORM: NSP VOLUNTARY ACQUISITION OF
FORECLOSED PROPERTY
Grantee or Agency Letterhead
(date)
Dear
(City, County, State, other) , is interested in acquiring property you
own at (address) for a project receiving funding assistance
from the U.S. Department of Housing and Urban Development (HUD) under the Neighborhood
Stabilization Program (NSP).
Please be advised that- the (City, County, State, other) possesses
eminent domain authority to acquire property. However, in the event you are not interested in
selling your property, or if we cannot reach an amicable agreement for the purchase of your
property, we will not pursue its acquisition under eminent domain.
Your property is not a necessary part of the proposed project and is not part of an intended,
planned, or designated project area where substantially all of the property within the area is to be
acquired.
Under the NSP, we are required to purchase foreclosed property at a discount from its current
market appraised value. Our appraisal indicates the property's market value is
$ We are prepared to offer you $ to purchase your
property. This offer is less than the current market appraised value as required by the NSP.
Please contact us at your convenience if you are interested in selling your property.
In accordance with the Uniform Relocation Assistance and Real Property Acquisition Policies
Act (URA), owner-occupants who move as a result of a voluntary acquisition are not eligible for
relocation assistance. Atenant-occupant who moves as a result of a voluntary acquisition for a
federally-assisted project may be eligible for relocation assistance. Such displaced persons may
include not only current lawful occupants, but also former tenants required to move for any
reason other than an eviction for cause in accordance with applicable federal, state, and local
law. If your property is currently tenant-occupied or a tenant lawfully occupied your property
within the past 3 months prior to our offer, we need to know immediately. Further, you should
not order current occupant(s) to move, or fail to renew a lease, in order to sell the property to us
as vacant.
If you have any questions about this notice or the proposed project, please contact
(name) , (title) _
(address) , (phone)
Exhibit C-1
3~--I7
TEXT BELOW SHOWN FOR REFERENCE BUT WILL BE DELETED FOR THE
TEMPLATE FORM
NOTES to NSP Voluntary Acquisition of Foreclosed Property Informational Notice
1. The case file must indicate the manner in which this notice was delivered (e.g., certified
mail, return receipt requested) and the date of delivery. (See 49 CFR 24.5 and Paragraph
2-3 J of Handbook 1378)
2. Tenant-occupants displaced as a result of a voluntary acquisition may be entitled to URA
relocation assistance and must be so informed per 49 CFR 24.2(a)(15)(iv) -Initiations of
negotiations, and 49 CFR 24 Appendix A - 24.2(a)(15)(iv).
3. See 49 CFR 24.206 regarding eviction for cause.
4. This guideform may only be used if all of the requirements of 49 CFR 24.101(b)(1)(i)-
(iv) are met.
5. This is a guideform. It should be revised to reflect the circumstances.
Exhibit C-2
'3 r~-- ~8
EXHIBIT D
PTFA CERTIFICATION
SELLER'S OCCUPANCY CERTIFICATION UNDER
THE PROTECTING TENANTS AT FORECLOSURE ACT
(FOR VACANT PROPERTY ONLY)
[To be completed and signed by the seller of the property.)
Address of Property ("Property")
City, State Zip
The undersigned, Seller of the Property certifies to Twin Cities Community Land Bank LLC
(Buyer) that
Seller has complied with the provisions of the Protecting Tenants at Foreclosure Act,
Title VII of the Helping Families Save Their Homes Act of 2009 ("PTFA") in connection
with the Property, including any requirements of the giving of notice to vacate ("Notice")
as required pursuant to PTFA to any bona fide tenant of the Property if any such tenant
was in possession of the Property prior to Seller's notice of foreclosure; and
2. At the time of the acquisition of the Property by the buyer/grantee, the Property will be
delivered vacant, unoccupied and without any party in possession or with a right to
possession to the Property.
3. .Further, if the Property is not occupied at this time, the Seller also certifies and agrees
that it has not now and will. not after the date hereof allow any person, including the
former owner; to occupy the Property under a lease or any other agreement for possession
of the Property either oral or written.
Signature of Seller
By:
Name:
Its:
Date:
Exhibit D-1
3~--1 ~
TEXT BELOW SHOWN FOR REFERENCE BUT SHOULD BE DELETED FOR THE
FINAL CERTIFICATION FORM
NOTES TO SELLER'S OCCUPANCY CERTIFICATION UNDER
THE PROTECTING TENANTS AT FORECLOSURE ACT
A bona fide tenant is a tenant under a bona fide lease. A "bona fide" lease is considered
a bona fide lease only if:
(a) the mortgagor (or the child, spouse, or parent of the mortgagor) under the contract
(lease) is not the tenant;
(b) the lease or tenancy was the result of anarms-length transaction; and
(c) the lease or tenancy requires the receipt of rent that is not substantially less than
fair market rent for the property or the unit's rent is reduced or subsidized due to a
Federal, State, or local subsidy. PTFA Section 702(b) (Note the Bridge Notice
provides for a slightly different definition at 1 (a)).
2. Generally, the PTFA requires that the initial successor in interest (typically the Seller)
provide a 90-day notice to vacate to a bona fide tenant of the foreclosed property
acquired by the successor in interest. If the tenant has an existing bona fide lease, the
tenant may occupy the premises until the remaining term of the lease or 90 days after
receipt of the 90-day notice, whichever is longer. However, the successor in interest may
terminate the tenant's lease (even a lease for a greater remaining term than 90 days) if the
successor in interest sells the unit to a purchaser who .will occupy the unit as a primary
residence, and the successor in interest provides 90-day notice to the tenant. PTFA
Section 702 (a)(2).
3. Notice given under the PTFA is notice given as required by state law.
4. The effective date of the requirements of PTFA are May 20, 2009, however the original
requirements for protection of tenants was found in the so called Stimulus Bill ("ARRA")
which had an effective date of February 17, 2009.
Exhibit D-2
3-8~ac~
EXHIBIT E
ACQUISITION PROCESS
Step
No.
NCST
Timeline
1.
2.
3.
4.
5.
6.
7.
8.
Foreclosure redemption period ends. Over the next 2-4 weeks, Lender-Owner ensures house is
vacant and secured. No property should be purchased if a bona fide tenant will be displaced as a
direct result of acquisition for anNSP-assisted activity. Lender must cert~ compliance with
tenant protections under ARRA. 24 CFR 42.305 - 42.350, 42 USC 5304(d), 49 CFR 24.2(a)(15)
y
Lender a-mails the foreclosed property addresses to NCST. NCST provides list of properties in
zip codes identified by the buyer. TCCLB posts the NCST List to Google Docs. Developers are
notified new properties are available for consideration via email.
For properties posted before 3 pm, each Developer is given until 9 am the following business
day to review new property lists and indicate which properties, if any, it is interested in
inspecting. For properties posted after 3 pm, each Developer is given until 11 am the following
business day to review new property lists and indicate which properties, if any, it is interested in
inspecting. Developer will update the designated field in the Google Docs form to "yes" if it is
interested in inspecting a property.
Entry for inspection of selected properties is made through Lender's REO Managers/Agents by
each Developer referencing the property is being inspected through the First Look program. If
Developer is interested in a property after inspection, Developer obtains BPO.
y
Within 5 business days of date property is posted, the interested Developer is required to return
to Google Docs and indicate if it wants to receive .pricing for each inspected property by
updating the designated field to "yes" in Google Docs. If pricing is not desired, a reason should
be indicated. A response is due by 9 am for properties originally posted before 3 pm, l lam for
properties posted after 3 pm.
NOTE: Developers are responsible for final verification that properties selected for pricing are
within NSP 1 eligible areas or will quay for arty other development programs for which they
currently have funding.
TCCLB requests Lender's prices on the selected properties. Lender obtains FMV estimate and
makes appropriate adjustments to equal Lenders Adjusted Price. NCST e-mails Lender's
Adjusted Price to TCCLB. NCST Guidelines and TCCLB procedures
TCCLB posts the price of each property on Google Docs for review by interested Developers.
For prices posted by 3 pm, each Developer will have until 9 am the following business day to
indicate if it would like to proceed with purchase. For prices posted after 3 pm, each Developer
will have until 11 am the following business day to indicate if it would like to proceed with
purchase. In the event more than 1 Developer is interested in a property, priority will be as
follows: 1) Columbia Heights Community Development 2) NSP Developers 3) Other nonprofit
developers 4) Private developers 5) Nonprofit developer buying for a Private developer. If more
than one Developer in any category is interested in a property. A lottery system will be used to
determine what order the .development partners will be given priority in purchasing the property.
Developer must also send an email to infompls(a~tcclandbank.ora to confirm acceptance of
Day
1
5 days
Day
6
Day
7
Exhibit E
~~' ~~
9.
10.
11.
12.
13.
14.
15.
16.
17.
18
19.
pricing. This email is binding.
TCCLB sends "Preliminary Acquisition Notice" to Lender re: potential interest in buying
property and extending invitation to accompany Developer-hired appraiser. Further
NCST/HUD guidance to be delivered.
At the time of a-mail acceptance of Lender/seller's price, Developer sends assignment to the
appraiser, along with a URA scope of work (An appraisal is needed even if the parcel will be
donated. But note: If the anticipated value does not exceed $25,000, review of available data by
a person qualified to make the valuation may be substituted for an appraisal. If Lender already
has a URA appraisal meeting NSP requirements, another appraisal is not required so long as the
NCST Purchase Agreement will be signed within 60 days from the Lender's appraisal date.)
At the time of a-mail acceptance of Lender/seller's price, Developer is responsible for
completing the NSP Initial Property Set-up form and submitting it to Tonja West-Hafner at
ton~a.k.west-hafnerCcr~,hennepin.co.mn.us (cc: Julie Urban at jurban(c~,cityofrichfield.ors and
Michelle Lewis at mlewisna,cityofrichfield.org). Ms. West-Hafner will order the appraisal,
environmental review, and lead paint inspection (pre-1978 homes).
y
Developer receives and reviews URA appraisal and determines whether or not to buy property at
Lender's Adjusted Price which cannot exceed URA appraisal value less (minimum) 1 percent
discount. If approval from State Historic Preservation Office staff has not been received at this
point, offer must be conditional. A copy of the appraisal and SHPO e-mailed to TCCLB for file.
At the time of a-mail acceptance of Lender/seller's price, TCCLB sends Exhibit C-1, Voluntary
Sale Offer Letter, Exhibit C-2, Seller's Occupancy Certificate and NCST Purchase Agreement to
Lender re: URA appraisal value, price offered, no eminent domain and no displacement.
TCCLB receives executed NCST Purchase Agreement and signed Seller's Occupancy
Certificate from Lender.
At the time of a-mail acceptance of Lender/seller's price, TCCLB obtains title work and verifies
that Lender will pass marketable title. TCCLB obtains earnest money from Developer within 1
business day and sends earnest money, if required, to Escrow Agent. TCCLB schedules
concurrent purchase and resale closings with Title Company. Title Company sends
confirmation closings are scheduled to all parties.
TCCLB processes resale purchase agreement and .forwards to Developer for review and
signature.
Lender and Title Company Closer prepare NCST closing package. TCCLB and Title Company
prepare resale closing package.
TCCLB and Developer review file checklist to ensure all supporting documentation is on file
and completed within 14 days of a-mail acceptance. If any documentation has not been
received, closing will be delayed until all documentation is on file.
y
Upon verification of receipt of all required documentation, including SHPO approvals,
Day
Day
10
Day
18
Day
20
Day
Exhibit E
~ ~- 22
20.
scheduled closing date is confirmed with Title Company and, TCCLB and Developer proceed to
purchase and resale closings.
y
Developer now owns selected property.
DEFINITIONS OF ABBREVIATIONS
25
BPO Broker Frice Opinion
FMV Fair Market Value
MLS Multiple Listing Service
NCST National Community Stabilization Trust
NCST List A list of foreclosed properties in target areas that Lenders e-mail to NCST. NCST e-mails this list
to TCCLB who then forwards it to Brooklyn Center Business and Development Department and
other Developers.
NSP Neighborhood Stabilization Program
SHPO State Historic Preservation Office
TCCLB Twin Cities Community Land Bank LLC
URA Uniform Relocation Act
Exhibit E
3~-a~
EXHIBIT F
FORM PURCHASE AGREEMENT
NSP I PURCHASE AGREEMENT
Seller: Twin Cities Community Land Bank LLC
Buyer: Housing and Redevelopment Authority in and for
the City of Richfield
Property Address:
Parcel:
Effective Date: , 20
Exhibit F-1
3 ~-a ~}
TABLE OF CONTENTS
Section 1. Property ....................................................................................................................3
Section 2. Purchase Price ..........................................................................................................4
Section 3. Effective Date ..........................................................................................................4
Section 4. Evidence of Title and Remedies ..............................................................................4
Section 5. Closing and Possession ............................................................................................5
Section 6. Conveyance of Title and Permitted Encumbrances .................................................5
Section 7. Closing Adjustments and Prorations ........................................................................6
Section 8. Conditions to Closing ..............................................................:...............................7
Section 9. Seller's Warranties ................................................................................................. ..8
Section 10. Seller's Closing Documents .....................................................................................9
Section 11. Buyer's Closing Documents ........., ........................................................................ 10
Section 12. Property Conveyed "As Is" .................................................................................... 10
Section 13. Voluntary Sale ....................................................................................................... 11
Section 14. Operation Prior to Closing ..................................................................................... 11
Section 15. Condemnation .......................................................................:................................ 11
Section 16. Risk of Loss ......................................................:.................................................... 11
Section 17. Remedies ................................................................................................................ 12
Section 18. Conditions Precedent to Obligations of Seller ....................................................... 12
Section 19. Broker's Commission ............................................................................................ 12
Section 20. Notices ................................................................................................................... 13
Section 21. Miscellaneous Provisions .....:................................................................................. 13
EXHIBITS
Exhibit A Legal Description
Exhibit B Contract for Purchase of First Look Program Property
Exhibit F-2
~~=a~
NSP I PURCHASE AGREEMENT
THIS NSP I PURCHASE AGREEMENT ("Agreement") is made as of the day
of 20 by and between Twin Cities Community Land Bank LLC, a
Minnesota nonprofit corporation ("Seller"), and Housing and Redevelopment Authority in and
for the City of Richfield ("City"), a public body corporate and politic under the laws of the State
of Minnesota ("Buyer").
Recitals
A. Buyer wants to acquire certain real estate and improvements located at
Richfield, Minnesota.
B. Seller has entered into the purchase agreement attached hereto as Exhibit B ("NCST First
Look Purchase Agreement") to acquire the Property (as defined below) from
on , or such other earlier or later
date as the Seller and ~ may mutually agree (the "First Look
Purchase Closing Date"), and Buyer has agreed to thereafter acquire the Property from
Seller.
C. Seller and Buyer have entered into the First Look Program Acquisition Agreement
relating to the purchase of certain Eligible Properties (as defined in the First Look
Program Acquisition Agreement) under which Seller has agreed to purchase certain
Eligible Properties (as defined therein) pursuant to a program called "First Look" ("First
Look Program") with the National Community Stabilization Trust ("NCST").
D. Whereas, the parties have determined that the Property is an Eligible Property.
E. The parties wish to define their respective rights, duties and obligations related to the
sale/purchase of the Property.
NOW, THEREFORE, in consideration of the mutual promises and the respective
agreements contained herein, the parties hereby agree as follows:
SECTION 1. PROPERTY
Seller agrees to sell and Buyer agrees to purchase the Property, together with all
hereditaments, improvements, and appurtenances, including:
(a) Property. That certain real property located in Hennepin County, Minnesota,
legally described on Exhibit A attached hereto (the "Real Estate") together with:
(i) all buildings and improvements now or hereafter constructed or located on the
Real Estate (the "Improvements"), and (ii) all easements, interests, rights and
privileges benefiting or appurtenant to the Real Estate including, but not limited
to, all right, title and interest of Seller in, over and to any land lying in the bed of
any highway, street, road, avenue, or alley existing or proposed, in front of or
abutting or adjoining the Real Estate, and all right, title and interest of Seller in
Exhibit F-3
r3~° alto
and to any unpaid award for the taking by eminent domain of any part of the Real
Estate or the Improvements or for damage thereto by reason of a change of grade
of any highway, street, road, avenue, or alley (the "Other Interests") (the Real
Estate, Improvements and Other Interests will be collectively referred to as the
"Property"); and
(b) Warranties. An assignment of all of Seller's right, title and interest in and to the
warranties of title, if any; that Seller received from the former owner of the
Property at the time Seller acquired the Property (the "Warranties").
SECTION 2. PURCHASE PRICE
The purchase price for the Property is Dollars
($ .00) ("Purchase Price"), which is due and payable to Seller at the place of closing on
and as of the Closing Date:
SECTION 3. EFFECTIVE DATE
The "Effective Date" of this Agreement is the date upon which the Seller has executed
this Agreement.
SECTION 4. EVIDENCE OF TITLE AND REMEDIES
Within a reasonable time after the date of this Agreement, Buyer, at its expense, will
obtain a commitment for an owner's policy of title insurance covering the Property from Old
Republic National Title Insurance Company (the "Title Company") and provide Seller a copy of
the same. The commitment will include copies of all instruments shown as exceptions or
referred to therein. No later than five (5) days prior to the Closing Date, Buyer shall notify Seller
of any objections to title, including covenants, conditions, restrictions and easements of record.
If any objections are made, Seller will have fifteen (15) days to make title marketable or
insurable to the satisfaction of the Title Company. If Seller fails to have the exceptions removed
or satisfied within the time provided, Buyer may elect to do any of the following:
(a) Waive the objection; or
(b) Terminate this Agreement by delivering written notice thereof to Seller without
further obligation or claim for damages between the parties.
If, prior to closing, Buyer learns of any lien against the Property or any encumbrance upon or
defect in Seller's title to the Property which has arisen because of any action on the part of Seller
after the date this Agreement has been fully executed (a "Later Objection"), Seller is obligated to
cure such Later Objection within five (5) days after receiving written notice of the Later
Objection from Buyer. If Seller fails to so cure any Later Objection, Buyer has, the right to take
any of the actions specified above in (a) and (b) of this Section 4.
Exhibit F-4
~~ ~a?
SECTION 5. CLOSING AND POSSESSION
(a) Subject to the provisions of Sections 4 and 8, closing shall occur simultaneously
with the First Look Purchase Closing Date, or such other later date as Seller and
Buyer may mutually agree (the "Closing Date"), at which time Seller shall deliver
marketable or insurable title to and possession of the Property to Buyer. The
Closing Date may be extended by agreement of Buyer and Seller. Any consent to
an extension of the Closing Date by Seller shall not be unreasonably withheld.
(b) Closing will be at the offices of the Title Company or at such other place as
designated by Buyer. At closing, Buyer shall deposit with the Title Company
sufficient funds to pay the Purchase Price as described in Section 2.. Buyer also
shall pay the title insurance premium and all closing costs charged by the Title
Company for conducting the closing.
(c) Seller shall vacate the Property no later than the date of Buyer's pre-closing walk
through inspection of the Property, which date will be no earlier than two (2) days
before the Closing Date.
SECTION 6. CONVEYANCE OF TITLE AND PERMITTED ENCUMBRANCES
Seller, at its own cost and expense or by application of the. funds deposited by Buyer with
the Title Company, shall deliver to the Title Company at or prior to closing a deed [which deed
may be a Limited Warranty Deed or Quit Claim ("Deed")], Bill of Sale, if any, and such other
documents as in the Title Company's opinion will, upon the receipt, filing, recording, or
registration thereof, vest in Buyer a marketable or insurable title to the Property, together with
lawful ownership ,of all fixtures, process utilities, or items of immovable property located thereon
or pertinent thereto, free and clear of any taxes and liens, special and pending assessments (not
assumed by Buyer), or encumbrances of any nature whatsoever, except:
(a) Restrictions, reservations, covenants and easements of record on the Effective
Date;
(b) Building and zoning laws, ordinances, state and federal regulations;
(c) Reservation of mineral or mineral rights to the State of Minnesota;
(d) General real estate taxes due and payable in the year of closing and subsequent
years; and
(e) To the extent waived by Buyer.
Exhibit F-5
~~,-~8
SECTION 7. CLOSING ADJUSTMENTS AND PROBATIONS
The following adjustments and prorations will be made at closing:
(a) Buyer shall pay all state deed tax or other taxes that must be paid in order to
record the Deed for the Property.
(b) At or before closing, Seller shall have caused to be paid all real estate taxes and
any penalties and interest thereon due and payable with respect to the Property in
all years prior to the year of closing.
(c) At or before closing, Seller shall have caused to be paid all deferred real estate
taxes (including so called "Green Acres" taxes), together with any penalties and
interest thereon, which have been deferred as of the Closing Date.
(d) At or before closing, if not previously paid by Seller, Buyer shall assume all
special assessments levied, pending or deferred against the Property as of the
Closing Date, including all deferred .assessments, including all those which
become due and payable as a result of the sale of the Property to Buyer. Seller
will pay on a prorated basis any special assessments certified for payment with
the current year's real estate taxes.
(e) At closing, general real estate taxes due and payable in the year of closing shall be
prorated between Buyer and Seller as of the First Look Purchase Closing Date on
a calendar year basis. In the event taxes for the current year are unavailable or
unknown, said taxes shall be prorated on the basis of the taxes for the prior yeax.
(f) Buyer shall pay all real estate taxes due and payable in the year following closing
and all subsequent years thereafter, if any.
(g) Buyer shall reimburse Seller the cost paid by Seller for an appraisal of the
Property.
(h) Buyer shall reimburse Seller the cost paid by Seller to Purchase the Property
pursuant to the First Look Program; such costs shall include the closing fee, the
cost of commitment for an owner's policy, the cost of an owner's policy of title
insurance, the cost of recording all documents necessary to place title to the
Property in the name of Seller, and the cost of miscellaneous items as evidenced
by the closing statement for the closing of Seller's purchase of the Property under
the First Look Program.
(i) Buyer shall pay to the Seller an administrative fee of Fifteen Hundred and No/100
Dollars ($1,500.00).
Exhibit F-6
~~J~a~
SECTION 8. CONDITIONS TO CLOSING
This Agreement is hereby expressly made subject to the following conditions having
been complied with on or before the Closing Date or as otherwise specified:
(a) First Look. Seller has purchased the Property pursuant to the NCST First Look
Purchase Agreement and in compliance with the First Look Program Acquisition
Agreement between Buyer and the Seller and title to the Property has been
delivered to Seller.
(b) Seller Acquisition Documents. If the First Look Purchase Closing Date occurs
prior to the Closing Date, Seller shall provide to Buyer copies of all closing
documents from Seller's purchase of the Property, including a marked copy of the
title commitment along with all documentation as required under the First Look
Program Acquisition Agreement between Buyer and Seller.
(c) Representations and Warranties. The representations and warranties of Seller that
are contained in this Agreement are true as of the Effective Date and the Closing
Date and are intended to survive the closing.
(d) Title. Buyer must be able to acquire marketable or insurable title to the Property.
(e) Title Policy. Buyer must be able to obtain a title insurance policy for the Property
in a form and substance that is satisfactory to Buyer (the "Title Policy").
(f) Performance of Seller's Obli atg ions. From the date of this Agreement until the
Closing Date, Seller shall have performed all of Seller's obligations under this
Agreement, as and when required by this Agreement, and Seller shall have
delivered Seller's Closing Documents (as defined below) to Buyer in accordance
with Section 10.
(g) Site, Soil and Environmental Testing. Seller shall have allowed Buyer, its
contractors or agents, access to the Property without charge and at all reasonable
times for the purpose of site, soil and environmental investigation and testing of
the Property. Buyer shall have paid all costs and expenses of such investigation
and testing and shall hold Seller harmless from all costs and liabilities relating
thereto (except for such costs and liabilities that may arise in connection with the
remediation of any pre-existing hazardous waste or pollution problem that is
discovered as a result of such investigation and testing). Buyer shall further repair
and restore any damage to the Property caused by or occurring during Buyer's
investigation and testing and return the Property to substantially the same
condition as existed prior to such entry. In addition, Buyer shall provide Seller
with copies of all reports and tests on the Property that have been obtained by
Buyer, if Buyer does not purchase the Property.
(h) Leases. The Property is not subject to any leases or occupancy agreements.
Exhibit F-7
3~-3~
(i) Assumption of Seller's Obli atg ions. Buyer shall assume all of Seller's obligations
and responsibilities under the NCST First Look Purchase Agreement.
Any and all of the foregoing conditions are for the benefit of Buyer, except items 8(a)
and 8(e), and may be waived, in writing, by Buyer. If any of the foregoing conditions are not
satisfied, Buyer shall have the right to terminate this Agreement without further obligation or
claim for damages between the parties hereto. If items 8(a) or 8(e) are not satisfied, Seller shall
have the right to terminate this Agreement without further obligation or claim for damages
between the parties hereto.
SECTION 9. SELLER'S WARRANTIES
As an inducement to Buyer entering into this Agreement, and as part of the consideration
therefor, Seller represents and warrants to Buyer that as of the Closing Date:
(a) Authority. This Agreement has been duly executed and delivered; all of Seller's
Closing Documents to be signed by Seller will have been duly executed and
delivered at closing; such execution, delivery and performance by Seller does not
and will not conflict with or result in a violation of any judgment, order, or decree
of any court or arbiter to which Seller is a party or by which it is bound; this
Agreement and the closing documents that will be signed by Seller will contain
the valid and binding obligations of Seller and be enforceable in accordance with
their terms.
(b) Title to Property. Seller owns the .Property, free and clear of all liens,
encumbrances and encroachments, recorded or unrecorded, except as may be
disclosed in the Title Commitment.
(c) Permits. To the best of Seller's knowledge, no permits are required from any
governmental entity in order to operate the Property as it is now operated.
(d) Storage Tanks. To the extent storage tanks exist on or under the Property, such
storage tanks .have been duly registered with all appropriate regulatory and
governmental bodies and are, to the best of Seller's knowledge, otherwise in
compliance with applicable federal, state and local statutes, regulations,
ordinances and other regulatory requirements.
(e) Rights of Others to Purchase Property. Other than the NCST First Look Purchase
Agreement, Seller has not entered into any other contracts for the sale of the
Property, nor are there any rights of first refusal or options to .purchase the
Property or any other rights of others that might prevent the consummation of this
Agreement.
(f) Seller's Defaults. To the best of Seller's knowledge, Seller is not in default of any
of its obligations or liabilities regarding the Property.
(g) Proceedings. To the best of Seller's knowledge, there axe no claims, actions,
suits, proceedings or investigations pending or, to Seller's knowledge, threatened,
Exhibit F-8
3~~~ I
including bankruptcy proceedings, by any governmental department or agency, or
any corporation,. partnership, entity or person, which in any manner or to any
extent may affect: (i) the Property; (ii) Seller's right, title and interest in and to
any part or all of the Property; or (iii) Seller's ability to vest in Buyer a fee simple
ownership interest in the Property free and clear of any and all liens and rights of
redemption.
(h) Agents and Employees. No management agents or other personnel employed in
connection with the operation of the Property employed by Seller have the right to
continue such employment after the Closing Date. There are no claims for
brokerage commissions or other payments with respect to any leasing of all or any
part of the Property that will survive and remain unpaid after the Closing Date.
(i) Wells. Seller shall disclose knowledge of any wells located on the Property.
(j) Sewage Treatment S,, sue. To Seller's knowledge there is no individual sewage
treatment system on or serving the Property, a straight pipe-system does not exist
and a previous inspection report does not exist, or if a previous inspection report
exists, such report is attached to this Agreement.
(k) Geotechnical and Environmental Disclosures. Except as disclosed to Buyer and
in this Agreement or any exhibit hereto, to the best of Seller's information and
belief, Seller is not aware of any geotechnical problems on the Property or
contaminants, pollutants, hazardous wastes or hazardous substances present upon
the Property in amounts that constitute a violation of any federal or state statute or
regulation or local ordinance.
(1) Public Improvements and Assessments. Seller has not received notice of any new
public improvement project(s) or assessments, the cost of which a governmental
entity may assess against the Property.
(m) Methamphetamine. To Seller's knowledge, no methamphetamine production has
occurred on the Property.
Each of the representations and warranties contained in this Agreement shall survive the
closing and the consummation of this Agreement by Buyer with knowledge of any such breach
by Seller will not constitute a waiver or release by Buyer of any claims due to such breach.
SECTION 10. SELLER'S CLOSING DOCUMENTS
On the Closing Date, Seller shall execute and/or deliver to the Title Company, with
copies to Buyer, and make arrangements to have the closing agent record or file in the
appropriate county land records any documents necessary to establish the marketability or
insurability of Seller's title to the Property, including the following (collectively, the "Seller's
Closing Documents"):
(a) Deed. A Limited Warranty Deed conveying the Property to Buyer in the manner
described in Section 6 herein.
Exhibit F-9
~(~'J Z_.
(b) Assignment of Warranties. An Assignment of Warranties, pursuant to which the
Warranties described in Section 1(b), if any, will be assigned to Buyer.
(c) Seller's Affidavit. An Affidavit of Title duly executed by Seller indicating that on
the Closing Date there are no outstanding unsatisfied judgments, tax liens or
bankruptcies against or involving Seller or the Property; that there has been no
skill, labor or material furnished to the Property at Seller's request for which
payment has not been made or for which mechanics' liens could be filed; and. that
there are no other unrecorded interests in the Property of which Seller has
knowledge except as stated therein, together with such other certifications as may
be required by a title insurance company to issue the Title Policy.
(d) FIRPTA Affidavit. Anon-foreign entity affidavit, properly executed and in
recordable form, containing such information as is required by IRC Section
1445(b)(2) and its regulations.
(e) IRS Reporting Form. The appropriate Federal Income Tax reporting form, if any
is required.
(fj Recording Documents. Any necessary Storage Tank Affidavit, Well Certificate
or similar document that is needed to record the Warranty Deed.
(g) Other Documents. All other documents reasonably necessary to transfer
marketable insurable title to the Property to Buyer free and clear of all liens.
SECTION 11. BUYER'S CLOSING DOCUMENTS
On the Closing Date, Buyer will execute and/or deliver to Seller the following
(collectively, the "Buyer's Closing Documents"):
(a) Purchase Price. The Purchase Price by check or ACH deposit of U.S. Federal
Funds.
(b) Title Documents. Such Affidavits of Purchaser or other documents as may be
reasonably required by a title insurer in order to record the Seller's Closing
Documents and issue the Title Policy.
SECTION 12. PROPERTY CONVEYED "AS IS"
The Property being purchased by Buyer, including the dwelling, other improvements and
fixtures, is not new and is being purchased in its "AS IS" condition, including all defects, known
or unknown. Buyer acknowledges the Property may not be in compliance with applicable
building, zoning, health or other laws or codes, and that the Property may not be in habitable
condition. Buyer further agrees that Seller, its agents, employees, representatives and assignees
shall have no liability for any claim or losses Buyer or Buyer's successors in interest and/or
assigns may incur as a result of defects which may now or may hereafter exist with respect to the
Property, and Buyer shall defend Seller, its agents and assignees from any such claim. Buyer
understands and agrees that Seller, his or her agents or assigns, will not, prior or subsequent to
Exhibit F-10
~~-33
the closing, be responsible for the repair, replacement, or modification of any deficiencies,
malfunctions or mechanical defects in the material, workmanship, or mechanical components of
the structures, improvements, or land.
Buyer accepts any property interest conveyed herein "AS IS WITH ALL FAULTS" and
is not relying upon any .representations or warranties or promises of any kind whatsoever,
express or implied, from Seller, except as otherwise provided herein or in one of Seller's Closing
Documents. ANY WARRANTIES OF PHYSICAL CONDITION OF THE PROPERTY
CONTAINED IN THIS AGREEMENT INCLUDING, BUT NOT LIMITED TO, CENTRAL
AIR-CONDITIONING, HEATING, PLUMBING, WIRING, AND CONNECTION TO CITY
SEWER AND CITY WATER ARE VOID TO THE EXTENT PERMITTED BY LAW. This
provision shall survive delivery of the Deed. All other warranties specified in this Agreement
remain the same.
SECTION 13. VOLUNTARY SALE
This is a voluntary negotiated sale between Seller and Buyer. The transaction
contemplated hereunder is not being made under the threat of eminent domain.
SECTION 14. OPERATION PRIOR TO CLOSING
During the period from the Effective Date to the Closing Date (the "Executory Period"),
Seller shall operate and maintain the Property in the ordinary course of business and in
accordance with reasonable business standards. Seller shall not, however, execute any contracts,
leases or other agreements affecting the Property during the Executory Period.
SECTION 15. CONDENINATION
If, prior to the Closing Date, eminent domain proceedings are commenced against all or
any part of the Property, Seller shall immediately give Buyer written notice of such fact and
Buyer will have the right (to be exercised within thirty (30) days after receipt of Seller's notice)
to terminate this Agreement. If this Agreement is so terminated, neither party will have any
further obligations under this Agreement: If Buyer does not so terminate this Agreement, the
Purchase Price will be reduced by any condemnation awards paid to Seller prior to closing and
Seller shall, at closing, assign to Buyer all of Seller's right, title and interest in and to any award
made or to be made in the condemnation proceedings.
SECTION 16. RISK OF LOSS
Seller assumes all risk of loss related to damage to the Property prior to the Closing Date.
In the event of fire, destruction or other casualty loss to the Property after Seller's acceptance of
this Agreement and prior to closing and funding, either Parry may terminate this Agreement and
neither party shall have any further rights or liabilities hereunder except as otherwise provided
herein.
Exhibit F-11
38-3~f
SECTION 17. REMEDIES
If Buyer defaults under this Agreement, Seller will have the right to terminate this
Agreement by giving written notice to Buyer or Seller will have the right to seek. and. recover
damages from Buyer for Buyer's nonperformance of its obligations hereunder. If Buyer fails to
cure such default within the time period specified by Minnesota Statutes § 559.21, this
Agreement shall terminate. If Seller defaults under this Agreement, Buyer will have the right to
seek and recover damages from Seller for Seller's nonperformance of its obligations hereunder or
to seek specific performance of this Agreement; provided that any action for specific
performance must be commenced within sixty (60) days after the Closing-Date.
SECTION 18. CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER
The obligations of Seller to consummate the transaction contemplated by this Agreement
are subject to the fulfillment on or before the Closing Date of all of the following conditions, any
of which may only be waived by the Seller in writing:
(a) Representations and Warranties True. All of the representations and warranties of
Buyer contained in this Agreement shall be true and correct in all respects on and
as of the Closing Date.
(b) Covenants and Agreements Performed. Buyer shall have performed and
complied with all covenants and agreements or conditions contained in this
Agreement and delivered all documents, required by this Agreement to be
performed, complied with or delivered to Seller.
(c) Buyer's Closing Documents. Seller shall have received Buyer's Closing
Documents as described in Section 10 of this Agreement.
SECTION 19. BROKER'S COMMISSION
Seller and Buyer represent and warrant to each other that they have dealt with no other
brokers, finders or the like in connection with this Agreement. Seller and Buyer each agree to
indemnify each other and to hold each other harmless against all claims, damages, costs or
expenses of or for any other such brokerage fees or commissions resulting from their actions or
agreements regarding the execution or performance of this Agreement.
Exhibit F-12
~EJ
SECTION 20. NOTICES
Any notice required or permitted to be given by any party upon the other (except for any
notice given pursuant to Minnesota. Statutes § 559.21) is given in accordance with this
Agreement if it is sent to the party by delivering it personally to the individuals described, below,
or it is sent by United States mail, return receipt requested, postage prepaid, or it is transmitted
by telefacsimile, or it is deposited cost paid with a nationally recognized, reputable overnight
courier, properly addressed as follows:
If to Seller: Twin Cities Community Land Bank LLC
615 First St NE
Minneapolis, MN 55413
Attention: Becky Rom, Vice President
If to Buyer: Housing and Redevelopment Authority in and for the City of
Richfield
6700 Portland Avenue
Richfield, MN 55423
Attn: Mr. John Stark, AICP, Director of Community Development
Notices shall be deemed effective on the earlier of the date of receipt or the date of deposit as
aforesaid; provided, however, that if notice is given by deposit, then the time for response to any
notice by the other party shall commence to run one business day after any such deposit. Any
party may change its address for the service of notice by giving written notice of such change to
the other party, in any manner above specified, three days prior to the effective date of such
change.
SECTION 21. MISCELLANEOUS PROVISIONS
(a) Entire Agreement. This Agreement constitutes the entire agreement between the
parties hereto with respect to the transaction and it supersedes all prior
understandings or agreements between the parties hereto.
(b) Binding Effect. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns.
(c) Survival. All the terms, covenants, agreements, representations and warranties
made by the parties in this Agreement or in any document or instrument delivered
by the parties. pursuant to this Agreement shall survive this Agreement and the
closing, and are not merged into any deed to be delivered by Seller to Buyer, and
shall remain enforceable under the terms of this Agreement.
(d) Waiver; Modification. The failure by either party to enforce its rights hereunder
shall not constitute a waiver of said party's right to demand future performance of
the provisions hereof. No modification or extension of this Agreement shall be
binding unless in writing and signed by the parties.
Exhibit F-13
~~-3f~
(e) Time of Essence. Time is of the essence of this Agreement and each of its
provisions:
(f) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Minnesota.
(g) Assignment. This Agreement shall not be assigned by either party without the
prior written consent of the other, which consent shall not be unreasonably
withheld.
(h) Section Headings. The section headings used in this Agreement are for
convenience or reference only and shall not be deemed to-vary the content of this
Agreement or its covenants, agreements, representations and warranties or limit
the provisions or scope of any section.
(i) Subsequent Documentation. Each of the parties hereto agrees to execute and
deliver to the other party, as requested, any additional documents and/or
instruments that may reasonably be determined as necessary to consummate the
transaction.
(j) Wells. At closing Seller shall provide Buyer with a statement regarding any wells
that are located on the Property, as required by Minn. Stat. § 103I.235. If any
wells are located on the Property, Seller shall cause the existing well on the
Property to be sealed and capped in accordance with all applicable laws and
regulations prior to closing.
Exhibit F-14
3 ~-~~'7
IN WITNESS WHEREOF, the parties have executed this Agreement to be effective as
of the day and year first above written:
SELLER:
TWIN CITIES COMMUNITY LAND
BANK, LLC, a Minnesota nonprofit limited
liability company
By:
Becky Rom
Its: Vice Chair
Exhibit F-15
3(3-38
BUYER:
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
By:
Name:
Its: Executive Director
By:
Name:
Its: Chairperson
Exhibit F-16
~~ ~~~
EXHIBIT A to Purchase Agreement
LEGAL DESCRIPTION
PERMITTED ENCUMBRANCES
The following shall be permitted encumbrances on the title to the Property:
(a) governmental regulations, if any, affecting the use and occupancy of the Property;
(b) zoning laws of the City, County, and State;
(c) all rights in public highways upon the land;
(d) easements for public rights-of--way and public and private utilities;
(e) reservations to the State, in trust for the taxing districts concerned, of minerals and mineral rights in those
portions of the Property the title to which may have at any time heretofore been forfeited to the State for
nonpayment of real estate taxes;
(f) the lien of unpaid special assessments, if any, not presently payable but to be paid as a part of the annual
taxes to become due; and
(g) the lien of unpaid real estate taxes, if any, not presently payable but to be paid as a part of the annual taxes
to become due.
Exhibit F-17
3~-yD
EXHIBIT B to Purchase Agreement
NCST FIRST LOOK PURCHASE AGREEMENT
Exhibit F-18
~ ~-y ~
Neighborhood Stabilization Program
Purchase Agreement Addendum
City Purchase
This Neighborhood Stabilization Program Addendum (Addendum) is to be made part of the
Purchase Agreement (Agreement) dated 20_, between
(Seller) and
(Buyer), for the property located at:
MN, (the
Property).
A. Purchase Discount
The Buyer's obligation to close this transaction with federal assistance is expressly contingent
upon the results of an appraisal ordered by Hennepin County. The Buyer is using certain federal
funds that require the purchase price to be at or below 99 percent of the appraised value on the
appraisal ordered by Hennepin County. The Buyer shall be allowed 10 days after the date of this
Agreement to cancel based on the appraisal if the condition cannot be met, in which event this
Agreement will be null and void and the Seller shall return all earnest money to the Buyer.
B. Environmental Review
Notwithstanding any provision of this Agreement, the parties hereto agree and acknowledge that
this Agreement does not constitute a commitment of funds or site approval, and that such
commitment of funds or approval may occur only upon satisfactory completion of an
environmental review and receipt by Hennepin County under 24 CFR Part §58. The parties
further agree that the provision of any fund to the purchase is conditioned on Hennepin County's
determination to proceed with, modify or cancel the purchase based on the results of said
environmental review. Further, the buyer shall not undertake or commit any funds to physical or
choice-limiting actions, including property acquisition, demolition, movement, rehabilitations,
conversion, repair, construction, or execution of a construction contract prior to the
environmental clearance, as denial of any funds to purchase may result.
C. Disclosure to Seller with Voluntary, Arm's Length Purchase Offer
This is to inform you the Buyer would like to purchase the property under this Agreement, if a
satisfactory agreement can be reached for a proposed project which may receive funding
assistance from the U.S. Department of Housing and Urban Development (HUD) under the
Neighborhood Stabilization Program.
Please be advised that, the Buyer possesses eminent domain authority to acquire property,
however, in the event you are not interested in selling your property, or if we cannot reach an
amicable agreement for the purchase of your property, the Buyer will not pursue its acquisition
under eminent domain.
Seller's Initials
Buyer's Initials
Exhibit F-19
3~-42.
Your property is not a necessary part of the proposed project and is not part of an intended,
planned, or designated project area where substantially all of the property within the area is to be
acquired.
The property is listed for purchase at ($) The Buyer is prepared to offer
you ($) to purchase your property and receive clear title to the
property under the conditions described in the attached Agreement. The Buyer believes this
amount represents the current market value of your property. Under NSP,'we are required to
purchase foreclosed property at a discount from is current appraised value. Depending upon the
results of our appraisal, our final purchase offer may offer from the amount noted above.
Since the purchase would be a voluntary acquisition, arm's length transaction, you would not be
eligible for relocation payments or other relocation assistance in accordance with the Uniform
Relocation Assistance and Real Property Acquisition Policies Act (URA).
In accordance with the Uniform Relocation Assistance and Real Property Acquisition Policies
Act (URA), owner-occupants who move as a result of a voluntary acquisition are not eligible for
relocation assistance. Atenant-occupant who moves as a result of a voluntary acquisition for a
federally-assisted project may be eligible for relocation assistance. Such displaced persons may
include not only current lawful occupants, but also former tenants required to move for any
reason other than an eviction for cause in accordance with applicable federal, state, and local
law. If your property is currently tenant-occupied or a tenant lawfully occupied your
property on or after February 17, 2009, we need to know immediately. Further, you should
not order current occupant(s) to move, or fail to renew a lease, in order to sell the property to us
as vacant. Also, as indicated in the contract of sale, this offer is made on the condition that if the
property is vacant no tenant will be permitted to occupy the property before the sale is complete.
Again, if you do not wish to sell the property, the Buyer will take no further action to acquire it.
If you are willing to sell the property under the conditions described in this Agreement, please
sign the Agreement and initial this Addendum. Your signature on the Agreement and your
initials on this Addendum constitute acknowledgement that you have received this disclosure.
Please contact the Buyer if you have any questions about this disclosure.
D. Minimum Property Standards
Seller shall allow the Buyer to complete an inspection of the property within 10 days after the
date of this Agreement to establish if the property will meet the Hennepin Housing Consortium
New Construction and Rehabilitation Standards (Standards). If the Buyer determines that the
property does not meet the Standards, the Buyer shall have the right to cancel this Agreement, in
which event, this Agreement will be null and void and the Seller shall return all earnest money to
the Buyer.
Seller's Initials
Buyer's Initials
Exhibit F-20
3~ -~~
Neighborhood Stabilization Program
Purchase Agreement Addendum
Non-Eminent Domain Entity Purchase
This Neighborhood Stabilization Program Addendum (Addendum) is to be made part of the
Purchase Agreement (Agreement) dated 20_, between,
(Seller) and
Property).
(Buyer), for the property located at:
MN, (the
A. Purchase Discount
The Buyer's obligation to close this transaction with federal assistance is expressly contingent
upon the results of an appraisal ordered by Hennepin County. The Buyer is using certain federal
funds that require the purchase price to be at or below 99 percent of the appraised value on the
appraisal ordered by Hennepin County. The Buyer shall be allowed 10 days after the date of this
Agreement to cancel based on the appraisal if the condition cannot be .met, in which event this
Agreement will be null and void and the Seller shall return all earnest money to the Buyer.
B. Environmental Review
Notwithstanding any provision of this Agreement, the parties hereto agree and acknowledge that
this Agreement does not constitute a commitment of funds or site approval, and that such
commitment of funds or approval may occur only upon satisfactory completion of an
environmental review and receipt by Hennepin County under 24 CFR Part §58. The parties
further agree that the provision of any fund to the purchase is conditioned on Hennepin County's
determination to proceed with, modify or cancel the purchase based on the results of said
environmental review. Further, the buyer shall not undertake or commit any funds to physical or
choice-limiting actions, including property acquisition, demolition, movement, rehabilitations,
conversion, repair, construction, or execution of a construction contract prior to the
environmental clearance, as denial of any funds to purchase may result.
C. Disclosure to Seller with Voluntary, Arm's Length Purchase Offer
This is to inform you the Buyer would like to purchase the property under this Agreement to
owner occupy, if a satisfactory agreement can be reached. This purchase may receive funding
assistance from the U.S. Department of Housing and Urban Development (HUD).
Please be advised that the Buyer does not have authority to acquire your property by eminent
domain. In the event we cannot reach an amicable agreement for the purchase of your property,
the Buyer will not pursue-this proposed acquisition.
Seller's Initials
Buyer's Initials
Exhibit F-21
3~-~~
The property is listed for purchase at ($) The Buyer is prepared to offer
you ($) to purchase your property and receive clear title to the
property under the conditions described in the attached Agreement. The Buyer believes this
amount represents the current market value of your property. Under NSP, we are required to
purchase foreclosed property at a discount from is current appraised value. Depending upon the
results of our appraisal, our final purchase offer may offer from the amount noted above.
Since the purchase would be a voluntary acquisition, arm's length transaction, you would not be
eligible for relocation payments or other relocation assistance in accordance with the Uniform
Relocation Assistance and Real Property Acquisition Policies Act (URA).
In accordance with the Uniform Relocation Assistance and Real Property Acquisition Policies
Act (URA), owner-occupants who move as a result of a voluntary acquisition are not eligible for
relocation assistance. Atenant-occupant who moves as a result of a voluntary acquisition for a
federally-assisted project may be eligible for relocation assistance. Such displaced persons may
include not only current lawful occupants, but also former tenants required to move for any
reason other than an eviction for cause in accordance with applicable federal, state, and local
law. If your property is currently tenant-occupied or a tenant lawfully occupied your
property on or after February 17, 2009, we need to know immediately. Further, you should
not order current occupant(s) to move, or fail to renew a lease, in order to sell the property to us
as vacant. Also, as indicated in the contract of sale, this offer is made on the condition that no
tenant will be permitted to occupy the property before the sale is complete.
Again, if you do not wish to sell the property, the Buyer will take no further action to acquire it.
If you are willing to sell the property under the conditions described in this Agreement, please
sign the Agreement and initial this Addendum. Your signature on the Agreement and your
initials on this Addendum constitute acknowledgement that you have received this disclosure.
Please contact the Buyer if you have any questions about this disclosure.
D. Minimum Property Standards
Seller shall allow the Buyer to complete an inspection of the property within 10 days after the
date of this Agreement to establish if the property will meet the Hennepin Housing Consortium
New Construction and Rehabilitation Standards (Standards). If the Buyer determines that the
property does not meet the Standards, the Buyer shall have the right to cancel this Agreement, in
which event, this Agreement will be null and void and the Seller shall return all earnest money to
the Buyer.
Seller's Initials
Buyer's Initials
Exhibit F-22
~~"'T J
EXHIBIT G
I. CERTIFICATION REGARDING LOBBYING
Before HRA releases any of the funds covered by this Agreement, TCCLB shall sign the
following certification statement in accordance with the requirements of 24 CFR
570.611, 24 CFR 85.36, and 24 CFR 84.42:
The undersigned hereby certifies, to the best of his or her knowledge and belief, that:
(1) NO FEDERAL APPROPRIATED FUNDS HAVE BEEN PAID, OR WILL BE PAID,
BY OR ON BEHALF OF THE UNDERSIGNED, TO ANY PERSON FOR
INFLUENCING OR ATTEMPTING TO INFLUENCE AN OFFICER OR EMPLOYEE
OF AN AGENCY, A MEMBER OF CONGRESS, AN OFFICER OR AN EMPLOYEE
OF CONGRESS, OR AN EMPLOYEE OF A MEMBER OF CONGRESS IN
CONNECTION WITH THE AWARDING OF ANY FEDERAL CONTRACT, THE
MAKING OF ANY FEDERAL GRANT, THE MAKING OF ANY FEDERAL LOAN,
THE ENTERING INTO OF ANY COOPERATIVE AGREEMENT, AND THE
EXTENSION, CONTINUATION, RENEWAL, AMENDMENT, OR MODIFICATION
OF ANY FEDERAL CONTRACT, GRANT, LOAN, OR COOPERATIVE
AGREEMENT.
(2) IF ANY FUNDS OTHER THAN FEDERAL APPROPRIATED FUNDS HAVE BEEN
PAID OR WILL BE PAID TO ANY PERSON FOR INFLUENCING OR
ATTEMPTING TO INFLUENCE AN OFFICER OR EMPLOYEE OF AN AGENCY,
A MEMBER OF CONGRESS, AN OFFICER OR AN EMPLOYEE OF CONGRESS,
OR AN EMPLOYEE OF A MEMBER OF CONGRESS IN CONNECTION WITH
THIS FEDERAL CONTRACT, GRANT, LOAN, OR COOPERATIVE AGREEMENT,
THE UNDERSIGNED SHALL COMPLETE AND SUBMIT STANDARD FORM LLL,
"DISCLOSURE FORM TO REPORT LOBBYING," IN ACCORDANCE WITH ITS
INSTRUCTIONS.
(3) THE UNDERSIGNED SHALL REQUIRE THAT THE LANGUAGE OF THIS
CERTIFICATION BE INCLUDED IN THE AWARD DOCUMENTS ALL SUB-
AWARDS AT ALL TIERS (INCLUDING SUB-CONTRACTS, SUB-GRANTS, AND
CONTRACTS UNDER GRANTS, LOANS, AND COOPERATIVE AGREEMENTS)
AND THAT ALL SUB-RECIPIENTS SHALL CERTIFY AND DISCLOSE
ACCORDINGLY.
This certification is a material representation of fact upon which reliance was placed
when this transaction was made or entered into. Submission of this certification is a
prerequisite for making or entering into this transaction imposed by section 1352, title
31, U.S. Code. Any person who fails to file the required certification shall be subject to a
civil penalty of not less than $10,000 and not more than $100,000 for each such failure.
Exhibit G-1
~~"' 7 SO
IN WITNESS WHEREOF, I have set my hand this
(date)
By:
Name:
Title:
FOR:
(organization)
II. CERTIFICATION REGARDING DEBARMENT
Before HRA releases any of the funds covered by this Agreement, TCCLB shall sign the
following certification statement:
Certification Regarding Debarment, Suspension, and
Other Responsibility Matters Primary Covered Transactions
This certification is required by the regulations implementing Executive Order 12549,
Debarment and Suspension, 29 CFR Part 98, § 98.510, Participants' responsibilities. The
regulations were published as Part VIII of the May 26, 1988 Federal Register (pages
19160 -1921 1).
AS THE DULY AUTHORIZED REPRESENTATIVE OF THE APPLICANT, I CERTIFY, TO
THE BEST OF MY KNOWLEDGE AND BELIEF, THAT NEITHER THE APPLICANT
NOR ANY OF THE PRINCIPALS:
(1) ARE PRESENTLY DEBARRED, SUSPENDED, PROPOSED FOR DEBARMENT,
DECLARED INELIGIBLE, OR VOLUNTARILY EXCLUDED FROM COVERED
TRANSACTIONS BY ANY FEDERAL DEPARTMENT OR AGENCY.
(2) HAS, WITHIN ATHREE-YEAR PERIOD PRECEDING THIS APPLICATION, BEEN
CONVICTED OF, OR HAD A CIVIL JUDGMENT ENTERED AGAINST THEM FOR
COMMISSION OF FRAUD OR OTHER CRIMINAL OFFENSE IN CONNECTION
WITH OBTAINING, ATTEMPTING TO OBTAIN, OR PERFORMING A PUBLIC
(FEDERAL, STATE OR LOCAL) TRANSACTION OR CONTRACT UNDER A
PUBLIC TRANSACTION; VIOLATION OF FEDERAL OR STATE ANTITRUST
STATUTES OR COMMISSION OF EMBEZZLEMENT, THEFT, FORGERY,
BRIBERY, FALSIFICATION OR DESTRUCTION OR RECORDS, MAKING FALSE
STATEMENTS, OR RECEIVING STOLEN PROPERTY.
(3) IS PRESENTLY INDICTED FOR OR OTHERWISE CRIMINALLY OR CIVILLY
CHARGED BY A GOVERNMENTAL ENTITY (FEDERAL, STATE OR LOCAL)
WITH COMMISSION OF ANY OF THE OFFENSES ENUMERATED IN
PARAGRAPH (2) (B) OF THIS CERTIFICATION.
Exhibit G-2
f~
(4) HAS NOT, WITHIN ATHREE-YEAR PERIOD PRECEDING THIS APPLICATION,
HAD ONE OR MORE PUBLIC TRANSACTIONS (FEDERAL, STATE OR LOCAL)
TERMINATED FOR CAUSE OR DEFAULT.
(5) WHERE THE APPLICANT IS UNABLE TO CERTIFY TO ANY OF THE
STATEMENTS IN THIS CERTIFICATION, HE OR SHE SHALL ATTACH AN
EXPLANATION TO THIS APPLICATION.
(6) THE UNDERSIGNED SHALL REQUIRE THAT THE LANGUAGE OF THIS
CERTIFICATION BE INCLUDED IN ALL SUBCONTRACT. AWARDS PURSUANT
TO THIS CONTRACT AND AGREES TO REQUIRE ANY SUCH SUB-
CONTRACTORS TO SIGN A DEBARMENT CERTIFICATION.
(Name and Title of Authorized Representative)
(Signature)
017295/290002/1084122_2
Exhibit G-3
AGENDA ITEM # LF
REPORT # S 1
~' STAFF REPORT
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING
DECEMBER 21, 2009
REPORT PREPARED BY:
REPORT PRESENTER:
JULIE URBAN/MICHELLE LEWIS, HOUSING
SPECIALIST
NAME, TITLE
JOHN STARK, COMMUNITY DEVELOPMENT
DIRECTOR ,
NAME, TITLE
DEPARTMENT DIRECTOR REVIEW:
REVIEWED BY EXECUTNE DIRECTOR:
ITEM FOR HRA CONSIDERATION:
Consideration of a request for a subordination of a Housing and Redevelopment Authority
Transformation Home loan at 201 72nd Street West.
I. RECOMMENDED ACTION:
By Motion: Approve the request for a subordination of a Housing and
Redevelopment Authority Transformation Home loan at 201 72nd
Street West.
II. BACKGROUND
Calan .and Laurie Hanzal of 201 72nd Street West have requested a subordination
of a $15,000 Transformation Home loan received on January 16, 2008. At 93
percent, the loan-to-value ratio exceeds the Housing and Redevelopment
Authority's (HRA) Subordination and Satisfaction Policy limit of 80 percent, and is
therefore being brought to the HRA for consideration.
The HRA's Transformation Home loan is currently in second place behind the
primary mortgage of $280,000. The Hanzals would like to refinance the superior
mortgage into a new mortgage of $272,345.25 lowering their interest rate from 6
percent to 5.25 percent. By refinancing, the Hanzals will reduce their monthly
payment by $163.52 a month.
122109 Hanzal subordination request appeal.doc
When the Hanzals took out the Transformation Home Loan in 2008, their home
appraised at $380,000 and their loan-to-value ratio was 77.6 percent. The current
appraised value of their home is $310,000 resulting in a higher loan-to-value ratio of
93 percent.
III. BASIS OF RECOMMENDATION
A. POLICY
• According to the HRA Subordination and Satisfaction Policy, "The total
debt secured by the property, including the HRA lien and all superior
mortgages, shall not exceed 80 percent of the documented market
value of the property." Astaff-authorized appeal of the Policy can be
granted if the loan-to-value ratio does not exceed 85 percent and all
other requirements of the Policy are met. The Hanzal's request does
not meet either of these rules.
• The subordination request does, however, meet all other requirements
of the Policy:
o Closing costs do not exceed three percent.
o Payment terms are within the financial means of the
borrower.
o No equity is being removed.
o Superior debt is not increasing.
o Property taxes are current.
o The HRA has not granted any previous subordinations to
the loan.
B. CRITICAL ISSUES
• The loan-to-value ratio is 92.6 percent.
• The amount of debt in front of the HRA lien is actually decreasing from
$280,000 to $272,345.25.
• The property's value has decreased from $380,000 to $310,000 and is
the reason for the increased loan-to-value ratio.
• The refinancing will lower the primary loan's interest rate and will
reduce the amount of the Hanzal's monthly payments.
C. FINANCIAL
• The amount of debt in front of the HRA lien is lowered with the
refinancing.
• There are no closing costs associated with the refinance. The new
loan amount is equal to the pay-off amount of the current mortgage.
• Payment has been received for the subordination request.
D. LEGAL
• N/A
1 V . ALTERNATIVE KECOMMENDATION(S) ~
• Deny the subordination request.
~ V. ATTACHMENTS ~
• rn~wyra~n ~i ~u i i cn~
• Letter from homeowner
VI. PRINCIPAL PARTIES EXPECTED AT MEETING
• Galan and Laurie Ha
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•
•
201 72nd Street West
•
December 11, 2009
~~
Re: Subordination on 201 W 72"d St Residence
Dear City of Richfield,
I am asking for an appeal on the matter of the subordination rejection during the refinancing of my
home mortgage.
Wells Fargo Home Mortgage has offered to lower my interest rate on my home mortgage at no closing
cost. It is an all around win-win situation for me and for Richfield to allow this refinancing to go through.
No cash is being taken out and my monthly payments will decrease a good amount. We love Richfield
and plan on staying here.
Because housing values decreased over the passed two years means that we fall short of the city's
guidelines on the subordination. However, this refinancing of our home in no way will be of a detriment
to the city of Richfield. It will only leave one of its homeowners in better standings to manage their day
to day expenses better.
A family of five who remodeled their home for $220,000.00 is really not looking to leave soon. We have
planned on being here a very long time. This refinancing will only help to make things better.
Thank you,
Calan Hanzal
201 W 72"d St
Richfield, MN 55423
AGENDA ITEM # S
REPORT # rj2
J
STAFF REPORT
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING
DECEMBER 21, 2009
REPORT PREPARED BY:
REPORT PRESENTER:
DEPARTMENT DIRECTOR REVIEW:
REVIEWED BY EXECUTIVE
JULIE URBAN/MICHELLE LEWIS, HOUSING
SPECIALIST
NAME, TITLE
JOHN STARK, COMMUNITY DEVELOPMENT
DIRECTOR
NAME, TITLE
ITEM FOR HRA CONSIDERATION:
Consideration of a Contract for Private Redevelopment between the Housing and
Redevelopment Authority and Charles Zawislak for the redevelopment of 6320 Morgan
Avenue under the Richfield Rediscovered Pro ram.
I. RECOMMENDED ACTION:
By Motion: Approve and authorize execution of a Contract for Private
Redevelopment between the Housing and Redevelopment Authority and
Charles Zawislak for the redevelopment of 6320 Morgan Avenue with the
following conditions:
1. That the Hearing Examiner grant the necessary variances to
construct the proposed structure.
2. That title work is provided prior to closing.
II. BACKGROUND
Charles Zawislak has submitted an application for the redevelopment of 6320
Morgan Avenue under the Richfield Rediscovered Program. The house that Mr.
Zawislak will acquire and demolish was built in 1925 and has 992 square feet. The
house is vacant and was in foreclosure. The house is in poor condition, has no
garage and is situated within the required front yard setback.
122109RR Contract 6320 Morgan Ave - Zawislak.doc
Mr. Zawislak purchased the property from an investment firm subsequent to its
realization that the necessary repairs would be too costly to make a profit. Mr.
Zawislak and his fiancee will own the new home and live there.
The new two-story home will have 2,039 finished square feet, 386 unfinished
square feet, three bedrooms, three baths and atuck-under, two-stall garage. The
home will have an estimated end value of $350,000.
There is a 10-foot grade difference from the rear to the front of the property making
the design of the house and garage space a challenge. A height variance will be
required in order to construct atwo-story structure on the property and provide for
garage space. A setback variance may also be needed for the front porch and
stairs, again due to the topography of the site.. The Hearing Examiner will consider
the variance request(s) on January 19, 2010. The Housing and Redevelopment
Authority (HRA) approval of the house design is contingent upon the variance(s).
Under the terms of the Contract for Private Redevelopment, a Lien is put on the
property until the house is completed. The lien will be in first position.
III. BASIS OF RECOMMENDATION
A. POLICY ~~
• The proposed project meets the objectives of the Richfield
Rediscovered program:
o Removes substandard, functionally obsolete housing and
eliminates its blighting influence.
o Provides new, higher valued housing.
o Alleviates the shortage of housing choices for families.
o Facilitates the HRA's "Market Rate Initiatives" by providing a
three-bedroom, owner-occupied house designed for a family.
• Richfield Rediscovered applicants bear a significant cost in acquisition
and demolition of an inner-ring suburban lot. The $70,000
Redevelopment Credit helps fill the financing gap and provides an
attractive incentive to move forward with new construction.
B. CRITICAL ISSUES
• The small house is in poor condition, has limited market appeal and
will be demolished to accommodate a home that provides move-up
housing.
• The property meets the program requirements qualifying as
substandard.
• Mr. Zawislak has been working with an architect on the plans and has
identified Stotko Speedling as his builder.
• The project meets the Housing Design and Site Development Criteria,
as defined in Exhibit B of the Contract for Private Redevelopment.
• The program provides for the Credit to be paid out in three
installments. Alien will be placed on the property in first position to
secure the funds. The lien will be removed once a Certificate of
Completion has been issued.
• Per the Contract for Private Development, the house must be
completed within one year. Mr. Zawislak estimates beginning
construction in February and completing the project by July.
C. FINANCIAL
• - This project is eligible fora $70,000 Redevelopment Credit subject to
the terms of the Contract for Private Redevelopment.
• Under the terms of the Contract, three installments would be made:
o $25,000 would be due and payable at closing.
o $25,000 would be due and payable following the issuance of a
building permit for construction.
o $20,000 would be due on the date of the issuance of a
Certificate of Completion.
D. LEGAL
• The Contract has been reviewed by the HRA Attorney.
• Mr. Zawislak is in agreement with the terms of the Contract.
IV. ALTERNATIVE RECOMMENDATION(S~
• Do not execute the Contract for Private Redevelopment.
• Amend the Contract for Private Redevelopment and direct staff to
work with the applicant to revise his proposal.
V. ATTACHMENTS
• Photo of existing house
• Contract for Private Redevelopment
• Building Plans, Elevations, Survey, Site Plan, Landscaping Plan
VI. PRINCIPAL PARTIES EXPECTED AT MEETING
• Mr. Zawislak, property owner
5-I
6320 Morgan Ave S -Existing
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House
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CONTRACT FOR PRIVATE DEVELOPMENT
Between
THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD, MINNESOTA
and
CHARLES ZAWISLAK
at
6320 MORGAN AVENUE SOUTH, RICHFIELD, MINNESOTA
This Instrument Drafted by:
Housing and Redevelopment Authority
in and for the City of Richfield
6700 Portland Avenue South
Richfield, MN 55423
612-861-9760
5~ 3
CONTRACT FOR PRIVATE DEVELOPMENT
THIS AGREEMENT, made and entered into as of this day of December 2009,
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 Charles Zawislak (Buyer).
WITNESSETH:
WHEREAS, the City of Richfield (City) and the HRA have previously created and
established a Redevelopment Project (Project) and Tax Increment Financing District (TIF
District) pursuant to the authority granted in Minnesota Statutes, Sections 469.001 through
469.047 and Sections 469.174 through 469.179 (collectively, the Acts); and
WHEREAS, pursuant to the Acts, the City and the HRA have previously adopted a
redevelopment plan (Redevelopment Plan) and a tax increment financing plan (TIF Plan) to
finance all or a portion of the public development costs of the Project; and
WHEREAS, in order to achieve the objectives of the Redevelopment Plan and TIF Plan
as hereinafter defined and particularly to make specified land in the Project available for
development by private enterprise for and in accordance with the Redevelopment Plan, the HRA
has determined to provide substantial aid and assistance to finance public development costs in
the Project; and
WHEREAS, the Buyer has proposed a development as hereinafter defined within the
Project which the HRA has determined will promote and carry out the objectives for which the
Project has been undertaken, will assist in carrying out the obligations of the Redevelopment
Plan and TIF Plan, will be in the vital best interests of the City and the health, safety and welfare
of its residents and is in accord with the public purposes and provisions of the applicable state
and local laws and requirements under which development in the Project has been undertaken
and is being assisted.
NOW, THEREFORE, in consideration of the mutual covenants and obligation of the
HRA and the Buyer, 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:
(a) Cam. The City of Richfield, Minnesota.
(b) Construction Plans. Collectively, the plans, drawings and related documents
related to the Improvements, which are listed on Exhibit D.
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(c) Buyer. Charles Zawislak.
(d) Development. The Property and the Improvements to be constructed thereon
according to the Construction Plans approved by the HRA.
(e) HRA. The Housing. and Redevelopment Authority in -and for the City of
Richfield, Minnesota.
(f) Closing The date on which Buyer closes on the Purchase of the Property.
(g) Housing and Redevelopment Authorities Act (HRA Act). Minnesota Statutes
Sections 469.001 through 469.047.
(h) Improvements. Each and all of the structures and site improvements constructed
on the Property by the Buyer, as specified in the Construction Plans approved by the HRA.
(i) Minimum Market Value. $300,000, which is the minimum market value for the
land and Improvements as confirmed by the Hennepin County Assessor.
(j) Mortgage and Holder. The term "mortgage" shall include the mortgages
referenced in Article VI of this Agreement and any deed of trust or other instrument creating an
encumbrance or lien upon the Property or any part thereof, as security for a loan. The term
"holder" in reference to a mortgage includes any insurer or guarantor (other than the Buyer) of
any obligation or condition secured by such mortgage or deed of trust.
(k) Pro a .The real property legally described as:
Lot 7, Block 10, Ray's Lynhurst Additon
Located on land having a street address o£
6320 Morgan Avenue South
(1) Redevelopment Proiect (Proiect). The Redevelopment Project established by
the HRA pursuant to Minnesota Statutes Sections 469.001 through 469.047 and described in the
Redevelopment Plan.
(m) Redevelopment Proiect Plan (Redevelopment Plan). The plans for
implementation of the Project adopted by the HRA pursuant to Minnesota Statutes Sections
469.001 through 469.047.
(n) Tax Increment Financing Act (TIF Act). Minnesota Statutes Sections 469.174
through 469.179.
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(o) Tax Increment Financing District (TIF District). The TIF District previously
created by the HRA pursuant to Minnesota Statutes Sections 469.174 through 469.179 and
described in the TIF Plan adopted therefor.
(p) Tax Increment Financing Plan (TIF Plan). The plan for development of the
TIF District previously adopted by the HRA pursuant to Minnesota Statutes, Sections 469.174
through 469.179.
(q) 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 Buyer.
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. Housing Design and Site Development Criteria
C. The Note and Mortgage
D. List of Construction Plan Documents
Section 1.3 Rules of Interaretation.
(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 Buyer. The Buyer makes the following representations and
undertakings:
(a) The Buyer has the legal authority and power to enter into this Agreement and has
duly authorized the execution, delivery and performance of this Agreement;
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(b) The Buyer has the necessary equity capital or will obtain commitments for
financing necessary for construction of the Improvements;
(c) The Buyer will construct the Improvements in accordance with the terms of this
Agreement and all local, state and federal laws and regulations;
(d) The Buyer 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; and
(e) The plans for the Improvements have been prepared by a qualified draftsperson or
architect.
(fj Buyer intends to reside at the Property following completion of construction; and
is not acquiring the Property for the purpose of resale or speculation.
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 Buyer and will cooperate with the efforts of
Buyer 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 BUYER
Section 3.1 Purchase of Prouerty by Buyer. The Buyer has, or will utilize its best
efforts to enter into a binding agreement to purchase the Property. Upon determination by the
HRA that Buyer has entered into a binding purchase agreement for the purchase of the Property,
the HRA will deliver to Buyer the Note described in Section 5.1. If no binding purchase
agreement is entered into within 30 days from the date of this Agreement, either the HRA or the
Buyer may declare this Agreement null and void, and the parties will thereby be released from
any further obligation hereunder.
Section 3.2 Closing. On or before the date of first installment, the Buyer will provide the
HRA with a mortgage in recordable form (and pay for the cost of recording). The mortgage will
act as security for repayment of any of the redevelopment credit advanced to the Buyer in the
event that construction of the Improvements is not completed on or before the date specified in
Section 4.3. The Mortgage will be in substantially the form of the mortgage shown on the
attached Exhibit C.
ARTICLE IV.
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CONSTRUCTION OF IMPROVEMENTS
Section 4.1. Construction of Improvements. The Buyer shall construct the
Improvements on the Property in accordance with the Construction Plans, shall 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.
Section 4.2. Building Plans. No building permit will be issued by the City unless the
building plans are in conformity with the Construction Plans, with the Buyer's Minimum Market
Value, this Agreement, including the Housing Design and Site Development Criteria contained
in Exhibit B, and all local, state and federal regulations. The HRA shall, within 25 days of
receipt of Construction Plans submitted in application for a building permit, review such
Construction Plans to determine whether the foregoing requirements have been met. If the HRA
determines such Construction Plans to be deficient, it shall notify the Buyer 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 Construction 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 December 21, 2010. All construction shall be in
conformity with the approved Construction Plans. Periodically during construction the Buyer
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 Buyer will be unable to complete construction of the Improvements in
the time permitted by this Section 4.3, it may notify the Buyer and demand assurances from the
Buyer regarding the Buyer'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 specific in Section 8.2 of this Agreement.
Section 4.4 Certificate of Completion. Promptly after notification by the Buyer 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, the HRA shall furnish the Buyer 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 with respect to the obligation of the Buyer to construct the
Improvements. Issuance of the Certificate of Completion shall also serve as a satisfaction of any
obligation of Buyer under the Note and Mortgage.
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 Buyer with a
written statement, indicating in adequate detail in what respects the Buyer has failed to complete
the Improvements in accordance with the provisions of this Agreement necessary, in the opinion
of the HRA, for the Buyer to take or perform in order to obtain such certification.
5
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 on Default under this Agreement.
ARTICLE V.
REDEVELOPMENT CREDIT
Section 5.1 Issuance of the Note. As consideration for Buyer's covenant to construct
the Improvements, and subject to all of the conditions of this Agreement, the HRA agrees to
provide the Buyer with a Redevelopment Credit in the amount of $70,000. Upon the Buyer
providing the HRA with evidence that Buyer has entered into a purchase agreement for the
purchase of the Property, the HRA will deliver to Buyer a promissory note in substantially the
form of the attached Exhibit C. Payment of the Redevelopment Credit will be exclusively
subject to and in accordance with the terms of the Note as such are contained in the Note or
described in this Agreement.
Section 5.2 Note Terms. The terms of the Note will include the following:
(a) Assuming the Buyer is in compliance with Buyers obligations, the Note will be
payable in three installments. The first installment of $25,000 will be due and payable upon
execution of the Contract by the HRA, the second installment of $25,000 will be due and payable
not later than five days following the date a building permit for construction of the Improvements
is issued, and the final installment of $20,000 on the date of the issuance of a Certificate of
Completion showing full completion of all of the Improvements including landscaping.
(b) The Note will be cancelled if the Closing does not occur by the last date provided
in Section 3.2; or if construction of the Improvements are not fully completed by the last date
provided in Section 4.3.
(c) The Note will not bear interest.
(d) The Note may be canceled by the HRA in the event that the Buyer is in default of
any of its obligations under this Agreement.
(e) The Note may not be assigned or pledged unless the proposed recipient certifies to
the HRA that it is aware of and accepts to the conditions of the Note governing payment.
(f) The Note will provide for repayment of the any Development Credit payments
paid to Buyer under the Note in the event that the Buyer fails to meet. the time requirements of
Sections 3.2 and 4.3. Such repayment obligation will be secured by a mortgage in substantially
the form shown in Exhibit C which will be delivered by Buyer to the HRA at Closing. Unless
the HRA agrees otherwise in accordance with Section 6.3, the Mortgage will be a first lien on the
Property.
Section 5.3 Payments Under the Note. On the date payments are due under the Note,
the HRA will make such payments by delivering the amount due to either the lending institution
6
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providing financing for construction of the Improvements, or the title company servicing the
construction loan. Such lending institution or title company may then use the delivered funds to
make payment to any contractor or materialman for work or materials actually furnished in
connection with the Improvements.
In the event that no lending. institution or title company is willing to serve in that capacity,
the HRA shall disburse the payments, when due, in any manner which in its reasonable judgment
will assure that the funds will be expended for construction of the Improvements.
ARTICLE VI.
FINANCING
Section 6.1 Financing. Within 15 days of the date of execution of this Agreement, the
Buyer shall submit to the HRA evidence of financing for the Improvements in compliance with
the provisions of Section 2.1(b) of this Agreement. If the HRA finds that the financing is
adequate in amount to provide for the construction of the Improvements, the HRA shall notify
the Buyer of its approval.
If the HRA rejects the evidence of financing as inadequate, the Buyer shall have 30 days
or such additional period of time as the Buyer may reasonably require from the date of such
notification to submit evidence of financing satisfactory to the HRA. If the Buyer 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,
except for the HRA's remedies pursuant to Section 4.5 of this Agreement.
Section 6.2 Copy of Notice of Default to Lender. Whenever the HRA shall deliver any
notice or demand to the Buyer with respect, to any Event of Default by the Buyer 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 Buyer, the HRA shall agree to modify this Agreement,
the Note or the Mortgage in the manner and to the extent the HRA deems reasonable, upon
request by the financial institution and the Buyer.
ARTICLE VII.
PROHIBITIONS AGAINST ASSIGNMENT AND TRANSFER
Section 7.1 Representation as to Redevelopment. The Buyer 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 Buyer 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
7
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making the Development possible, the qualification and identity of the Buyer are of particular
concern to the HRA. The Buyer 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 Buyer for the faithful performance of all
undertakings and covenants agreed by the Buyer 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 Buyer represents and
agrees that prior to the issuance of the Certificate of Completion by the HRA:
(a) Except only by way of security for, and only for the purpose of obtaining
financing necessary to enable the Buyer or any successor in interest to the Property, or any part
thereof, to perform its obligations with respect to the Development under this Agreement, and
any other purpose authorized by this Agreement, the Buyer, except as so authorized, has not
made or created, and that it will not make or create, or suffer to be made or created, any total or
partial sale, assignment, conveyance, or any trust 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.
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 Buyer to pay when due the payments required to be paid or secured
under any provision of this Agreement;
(b) Failure by the Buyer 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 Buyer 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 Buyer, on a petition in bankruptcy filed against it, be adjudicated as
bankrupt, or a court of competent jurisdiction shall enter an order of decree appointing, without
the consent of the Buyer, a receiver of the Buyer or of the whole or substantially all of its
property, or approve a petition filed against the Buyer seeking reorganization or arrangement of
the Buyer 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
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(e) If the Development is in default under any Mortgage and has not entered into a
work-out agreement with the Mortgagee.
Section 8.2 Remedies on Default. Whenever any Event of Default occurs, the HRA
may, in addition to any other remedies or rights given the HRA under this Agreement, take any
one or more of the following actions following written notice by the HRA to the Buyer as
provided in Section 9.5 of this Agreement:
(a) suspend its performance under this Agreement until it receives assurances from the
Buyer, deemed reasonably adequate by the HRA, that the Buyer will cure its default and continue
its performance under this Agreement;
(b) cancel or rescind this Agreement;
(c) cancel or rescind the Note;
(d) foreclose on the Mortgage;
(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 Buyer
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 Mortgagee succeed by foreclosure of the Mortgage or deed in lieu thereof
to the Buyer's interest in the Property; it shall, notwithstanding the foregoing, be obligated to
perform the obligations of the Buyer under this Agreement to the extent that the same have not
therefore been performed by the Buyer.
Section 8.3 No Remedy Exclusive. No remedy herein conferred upon or reserved to the
HRA is intended to be exclusive of any other available remedy or remedies, but each and every
such remedy shall be cumulative and shall be in addition to every other remedy given under this
Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to
exercise any right or power accruing upon any default shall impair any such right or power or
shall be construed to be a waiver thereof, but any such right and power may be exercised from
time to time and as often as may be deemed expedient. In order to entitle the HRA or the Buyer
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 8.4 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.
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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 Buyer, or any successor in interest, for any Event of Default by the HRA or for any amount
which may become due to the Buyer 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 Buyer 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:
(a) As to the HRA:
Richfield HRA
Executive Director
6700 Portland Avenue South
Richfield, MN 55423
(b) As to the Buyer:
Charles Zawislak
2935 Fremont Ave S #414
Minneapolis, MN 55408
or at such other address with respect to either such parry 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.
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IN WITNESS WHEREOF, the HRA has caused this Agreement to be duly executed in
its name and behalf and its seal to be hereunto duly affixed and the Buyer has caused this
Agreement to be duly executed as of the day and year first above written.
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
RICHFIELD, MINNESOTA
By
Its Chairperson
By
Its Executive Director
BUYER
11
5-1
STATE OF MINNESOTA
COUNTY OF
SS
The foregoing instrument was acknowledged before me this day of
200 , by Suzanne M. Sandahl, the Chairperson of the Housing
and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA), a public body
corporate and politic under the laws of Minnesota, on behalf of the HRA.
STATE OF MINNESOTA
COUNTY OF
Notary Public
SS
The foregoing instrument was acknowledged before me this day of
200 , by Steven L. Devich, the Executive Director of the Housing
and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA), a public body
corporate and politic under the laws of Minnesota, on behalf of the HRA.
Notary Public
STATE OF MINNESOTA )
SS
COUNTY OF )
The foregoing instrument was acknowledged before me this day of
200 , by Charles Zawislak.
Notary Public
12
"fir t
EXHIBIT A
FORM OF CERTIFICATE OF COMPLETION
The undersigned hereby certifies that ,has fully and
completely complied with its obligations under Article IV of 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. with respect
to the construction of the approved construction plans at ,legally
described as and is released and forever discharged from its
obligations to construct under such above-referenced Article.
DATED:
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
RICHFIELD
By:
Its: Chairperson
By:
Its: Executive Director
STATE OF MINNESOTA )
SS
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this day of
2009, by and
the Chairperson and 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:
Housing and Redevelopment Authority
in and for the City of Richfield
6700 Portland Avenue South
Richfield, MN 55423
612-861-9760
A-1
~-~~
EXHIBIT B
HOUSING DESIGN AND SITE DEVELOPMENT CRITERIA
Siding materials, exterior facade presentation, roof, window, siding and building line variability,
finished landscape, interior space function and use are all important considerations.
The development of all sites shall meet the development objectives listed below. The guidelines
were created to ensure that the homes built on the identified lots blend in with the surrounding
neighborhood and respond to specific concerns of the H12A.
1. General:
a. The home shall be single-family, owner occupied.
b. The value of the new home must meet or exceed the value specified for the
Development in the Contract for Private Development.
2. Site Standards:
a. The entire grounds shall be finish landscaped to be aesthetically pleasing in all
seasons. Land forms and plant materials shall be used to .define the site and neatly blend with
adjoining property.
b. Utility meters shall be screened from street view.
c. Site drainage shall be accommodated on the site so that water is directed away
from the new home and the neighboring properties. Neighboring properties should not be
disturbed to create drainage swales. Construction and the finished structure must improve or not
have a detrimental impact on storm water drainage patterns in the neighborhood.
d. Existing trees shall be preserved as much as possible. Care should be taken to
preserve existing root systems. A tree wrap with board reinforcement shall be used on trees
directly adjacent to active grading and construction areas.
e. The construction site, neighboring property and adjacent public street and
sidewalk shall be kept free of construction debris at all times.
f. Air conditioning units must be located in the rear yard of the house.
g. Egress window area well foundations must meet side setback requirements (a
minimum of 5' from the property line), or be located in the rear yard of the house.
B-1
F1
h. Under no circumstance during the construction period shall construction workers,
construction equipment or construction materials enter, disturb, or damage neighboring
properties. The HRA will solely determine whether a violation has occurred. A penalty of $50
per day will be assessed and drawn from the Letter of Credit after written notice of violation and
a ten (10) day period for correction has been provided the Builder. Alternately, the Buyer may
enter into a written agreement with the affected adjacent property owner(s) during this ten (10)
day period. The agreement must describe the details of correction and repair which the builder
will make at a specified alternate date during construction completion. The Buyer will be
responsible for the cost of corrections and repairs determined necessary by the affected adjacent
parties. Where disputes occur, the Buyer agrees to participate in mediation services to facilitate
problem resolution.
3. Building Standards:
a. A minimum of three completed bedrooms is required.
b. A minimum of one full completed bath and aroughed-in 3/4 bath is required.
A two car garage, attached or detached, must be provided on the site.
d. Exterior materials (siding, soffit, doors and windows) should be low maintenance.
Aluminum and vinyl are preferred. Natural cedar lap is acceptable if properly stained or painted.
Hardboard panels or hardboard lap siding are not acceptable.
e. Unit height and mass of the new home must be compatible with the scale of the
surrounding neighborhood.
f. 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 by the
Buyer.
g. A full basement shall be provided in the house unless the selected design results
in a split level type of construction.
h. House design is a critical element of the program. The HRA design review will
include: The house building lines, window and door placement, and orientation to street for
present a balanced and pleasing view from all sides. Windows that are double hung in style or
appearance with muntins (window pane grids) are preferred, especially on the street-facing
elevations. Garage door dominance in design must be minimized.
i. All construction must conform to current sound attenuation building standards for
properties located in 65-69 and 70-74 Ldn zones.
B-2
~-- C 8
EXHIBIT C
PROMISSORY NOTE
REDEVELOPMENT CREDIT NOTE
$70,000
2009
The Housing and Redevelopment Authority in and for the City of Richfield, Minnesota, a
public body corporate and politic (the "Maker"), for value received, hereby promises to pay to
Charles Zawislak (the "Holder") the principal sum of seventy thousand and No/100 Dollars
($70,000), with no interest as hereinafter provided, in any coin or currency which at the time or
times of payment is legal tender for the payment of private debts in the United States of America.
The principal of this Note is payable as follows:
1. The principal amount of the Note is as provided for in that certain agreement by
and between Maker and Holder entitled: Contract for Private Development dated
(the "Contract") and shall bear no interest. Terms
contained in this Note shall have the meanings given them in the Contract unless a different
meaning is clearly indicated.
2. The Note shall be due and payable the Note will be payable in three installments.
The first installment of $25,000 will be due and payable upon execution of the Contract by the
HRA, the second installment of $25,000 will be due and payable not later than five days
following the date a building permit for construction of the Improvements is issued, and the final
installment of $20,000 on the date of the issuance of a Certificate of Completion showing full
completion of all of the Improvements including landscaping. No amount shall be due or
payable prior to those dates.
3. This Note will be cancelled if the Closing does not occur by the last date provided
in Section 3.2 of the Contract; or if construction of the Improvements are not fully completed by
the last date provided in Section 4.3 of the Contract.
4. This Note is given pursuant to the Contract. All of the agreements, conditions,
covenants, provisions, and stipulations and remedies contained in the Contract are hereby made a
part of this Note to the same extent and with the same force and effect as if they were fully set
forth herein. It is agreed that time is of the essence of this Note. If a default by the Maker or the
Holder occurs under the Contract, then the Holder or Maker may at its right and option, exercise
any rights it may have under law or at equity, under the Agreement, and under the Note.
5. The remedies of the Maker or Holder as provided herein, and in the Contract, or
any other instrument, shall be cumulative and concurrent and may be pursued singly,
successively, or together, and, at the sole discretion of the Maker or Holder, may be exercised as
often as occasion therefore shall occur; and the failure to exercise any such right or remedy shall
in no event be construed as a waiver or release thereof.
3
~~i 9
The Maker or Holder shall not be deemed, by any act of omission or commission, to have
waived any of its rights or remedies hereunder unless such waiver is in writing and signed by the
Maker or Holder and then only to the extent specifically set forth in the writing. A waiver with
reference to one event shall not be construed as continuing or as a bar to or waiver of any right or
remedy as to a subsequent event. This Note may not be amended, modified, or changed except
only by an instrument in writing signed by the party against whom enforcement of any such
amendment, modifications, or change is sought.
6. This Note shall be governed by and construed in accordance with the laws of the
state of Minnesota without regard to its conflict of laws provisions. Any disputes, controversies,
or claims arising out of this Note shall be heard in the state or federal courts of Minnesota, and
all parties to this Note waive any objection to the jurisdiction of these courts, whether based on
convenience or otherwise
7. Holder may not assign, transfer or pledge this Note without the prior written
consent of the Maker. Maker may condition consent on obtaining a certification from the
proposed assignee, transferee or pledgee acknowledging and agreeing to Maker's rights to cancel
the Note in accordance with the terms of the Note and the Contract.
8. IT IS HEREBY CERTIFIED AND RECITED that all conditions, acts, and things
required to exist, happen, and be performed precedent to or in the issuance of this Note do exist,
have happened, and have been performed in regular and due form as required by law.
9. Any Development Credit payments paid to Buyer under the Note will be repaid to
the HRA in the event that the Buyer fails to meet the time requirements of Sections 3.2 and 4.3 of
the Contract. Such repayment obligation will be secured by a mortgage in substantially the form
shown in Exhibit C of the Contract which will be executed and delivered by Buyer to the HRA at
Closing. Unless the HRA agrees otherwise in accordance with Section 6.3, the Mortgage will be
a first lien on the Property.
IN WITNESS WHEREOF, the Maker has caused this Note to be duly executed as of the
_ day of , 2009.
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
RICHFIELD, MINNESOTA
By
Its Chairperson
By
Its Executive Director
4
~rac~
Buyer
STATE OF MINNESOTA )
SS
COUNTY OF )
The foregoing instrument was acknowledged before me this day of
200 , by ,the Chairperson of the Housing and
Redevelopment Authority in and for the City of Richfield, Minnesota (HRA), a public body
corporate and politic under the. laws of Minnesota, on behalf of the HRA.
Notary Public
STATE OF MINNESOTA
COUNTY OF
SS
The foregoing instrument was acknowledged before me this day of
200 , by ,the Executive Director of the Housing
and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA), a public body
corporate and politic under the laws of Minnesota, on behalf of the HRA.
Notary Public
STATE OF MINNESOTA
COUNTY OF
SS
The foregoing instrument was acknowledged before me this day of
200 , by Charles Zawislak, a single person.
Notary Public
This Instrument was Drafted by:
Housing and Redevelopment Authority
in and for the City of Richfield
6700 Portland Avenue South
Richfield, MN 55423
612-861-9760
5
~^a~
MORTGAGE
This Indenture made this day of , 2009, between CHARLES ZAWISLAK,
Mortgagor, and. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR
THE CITY OF RICHFIELD, MINNESOTA, a Minnesota public body corporate and politic
under the laws of the State of Minnesota, Mortgagee.
Witnesseth: That the said Mortgagor, in consideration of the sum of One ($1.00) Dollar and other
good, valuable and sufficient consideration, the receipt whereof is hereby acknowledged, does
hereby Grant, Bargain, Sell, and Convey unto the said Mortgagee, its successors and assigns,
Forever, all the tracts or parcels of land lying and being in the County of Hennepin and State of
Minnesota, described as follows, to-wit:
The separate tracts and parcels of land described in the attached Exhibit A. (The
"Property")
To Have and to Hold the Same, Together with the hereditaments and appurtenances thereto
belonging to the said Mortgagee, its successors and assigns, forever. And the said Mortgagor, for
itself, and its successors and assigns, does covenant with the said Mortgagee, its successors and
assigns, as follows: That it is lawfully seized of said premises and has good right to sell and convey
the same; that the same are free from all incumbrances, save and except reservations, restrictions
and easements of record; that the Mortgagee, its successors and assigns, shall quietly enjoy and
possess the same; and that the Mortgagor will Warrant and Defend the title to the same against all
lawful claims not hereinbefore specifically excepted.
Provided, Nevertheless, That if said Mortgagor, its successors and assigns, shall keep and perform
each and every one of its obligations with respect to completion of construction of the
Improvements to be constructed by Mortgagor under and pursuant to that certain Contract for
Private development dated as of (the "Contract"), made and entered
into between Mortgagor and Mortgagee, and shall keep and perform all the covenants .and
agreements herein contained, then this deed to be null and void, and to be released at the
Mortgagor's expense. This Mortgage secures a principal debt in the amount of $70,000 payable by
Mortgagor to Mortgagee under the terms of the Contract, and amendments thereto, between
Mortgagor and Mortgagee.
6
~~aa
And the Mortgagor, for itself, and its successors and assigns, does hereby covenant and agree with
the Mortgagee, its successors and assigns, to perform its obligations as above specified, to pay all
taxes and assessments now due or that may hereafter become liens against said premises at least ten
(10) days before penalty attaches thereto; to pay, when due, both principal and interest of all prior
liens or incumbrances, and to keep said premises free and clear of all other liens or incumbrances;
to commit or permit no waste on said premises and to keep them in good repair; to complete
forthwith any improvements which may hereafter be under course of construction thereon, and to
pay any other expenses and attorneys' fees incurred by said Mortgagee, its successors or assigns, by
reason of litigation with any third party for the protection of the lien of this Mortgage.
That Mortgagor, does further covenant and agree that if any lien for labor, skill or material shall
be filed for record during the life of this Mortgage, upon or against the premises hereby mortgaged,
the said Mortgagor will, within thirty (30) days after the date of its filing for record, either pay off
the said lien and secure its satisfaction of record, or will protect the Mortgagee against any loss or
damage growing out of its enforcement, by furnishing a bond for the same amount in the form and
with the sureties to be approved by the Mortgagee.
In case of failure to pay said taxes and assessments, prior liens or incumbrances, expenses and
attorneys' fees as above specified, or to insure said buildings and deliver the policies as aforesaid,
the Mortgagee, its successors or assigns, may pay such taxes, assessments, prior liens, expenses and
attorneys' fees and interest thereon, or effect such insurance, and the sums so paid shall bear interest
at the highest rate permitted by law from the date of such payment, shall be impressed as an
additional lien upon said premises, and be immediately due and payable from the Mortgagor, its
successors or assigns, to said Mortgagee, it successors or assigns, and this Mortgage shall from date
thereof secure the repayment of such advance with interest.
In case of default in any of the foregoing covenants, the Mortgagor confers upon the Mortgagee the
option of declaring a default and hereby authorizes and empowers said Mortgagee, its successors
and assigns, to foreclose this Mortgage by judicial proceedings or to sell said premises at public
auction and convey the same to the purchaser in fee simple in accordance with the statute, and out
of the money arising from such sail to retain all sums secured hereby, with interest and all legal
costs and charges of such foreclosure and the maximum attorneys' fee permitted by law, which
costs, charges and fees the Mortgagor herein agrees to pay.
In Testimony Whereof, The said Mortgagor has hereunto set its hand the day and year first above
written.
7
~ra~
STATE OF MINNESOTA
COUNTY OF HENNEPIN
The foregoing instrument was acknowledged before me this day of , 2009,
by Charles Zawislak, a single person.
(Notary Stamp or Seal) Notary Public
This Instrument was Drafted by:
Housing and Redevelopment Authority
in and for the City of Richfield
6700 Portland Avenue South
Richfield, MN 55423
612-861-9760
8
5~ay
EXHIBIT A
LEGAL DESCRIPTION
Lot 7, .Block 10, Rays Lynnhurst Addition
C-1
~--a~
EXHIBIT D
LIST OF CONSTRUCTION PLAN DOCUMENTS
• Contract for Private Development, fully executed
• Building Plans, approved by the HRA for design considerations and approved by the
Building Official for construction considerations
• Approved Site Plan
• Landscape Plan
• Purchase Agreement for sale of Property from Buyer to Homeowner
D-1
~ CERTIFICATE OF SURVEY
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I hereby certify that this survey Was prepared by me or under my direct supervision, and that I am c
registered land surveyor under the IaWs of the State of Minnesota. Dated this 29th day of October, 2009.
CARLSON & CARtsON, INC. BY
LAND SURVEYORS Larry R. Couture, Land Surveyor
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PLANT LIST
KEY COMMON NAME/bolanicBl nartq OTY SIZE
ASL AMEPoCAN LINDEN 5EMRY, OIi9enwl Bneepn0y 1 3'BB l.AN03CwPs
SSC SPPoNG SNOW CRABAPPLE, males aging anav 1 27/2'88 ~N
ACV COMPACT AMEPoCAN CRANBERRY VIBURNUM, viburnum Nbbum holey 4 #10 POT
SMP SLAWMWND MUGHO PINE, pious mughp slp~.mantl 3 #]POT ~~
SCiJ SEAGREEN JUNIPER, junipplue Chimtlmie mongp 3 #7 POT
D8H DWARF BUSH HONEYSUCKLE,tlieNilalpnicda 9 #B POT
DSS DAYIJLY, STELLA SUPREME, hwmmpalfo atellaeupmmp ~ 20 #1 POT DESIGN
DLG DAYULY,LITTLEGRAPETTE,homgocallislitaegrepopo 3T #1 POT FORD
F1SE HOSTA $IEBOLDIANA ELEGANS, hoslass 8 #1 POT INCORPORATED
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NOTE: ALL PLNJTEDARFJS SHALL BE MULCHED WITH SHREDDED WOOD MULCH
TO A DEPTH OF 3'-4'. PIANRNG BEDS SHALL BE EDGED WITH COMMERCIAL GRADE
VINYL EDGINC> 1° °°°B
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