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081610agendapacketCITY OF RICHFIELD, MINNESOTA MONDAY, AUGUST 16, 2010 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 July 19, 2010 2. HRA approval of agenda 3. Consideration of resolution authorizing purchase of real property located at 7537 Dupont Avenue through Richfield Rediscovered Program Staff Report No. 26 Notes: 4. Consideration of contract with S.R. Stevens Excavating, Inc. for demolition at 7326 Sheridan Avenue, 6336-15th Avenue, 6609 Humboldt Avenue, and 6637 Fifth Avenue and authorizing staff to contract for any uncovered abatement costs Staff Report No. 27 Notes: 5. Consideration of resolution authorizing Executive Director and HRA Chair to execute instruments necessary to purchase up to nine vacant and foreclosed houses using up to $1,060,000 from HRA Fund through December 31, 2010 Staff Report No. 28 Notes: 6. Consideration of resolutions approving 2011 proposed HRA budget and tax levy and 2010 HRA budget Staff Report. No. 29 Notes: 7. Executive Director report Notes: 8. 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 July 19, 2010 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; Doris Rubenstein, Steven Quam, Joan Helmberger and David Gepner Staff Present: Steven L. Devich, Executive Director; John Stark; Community Development Director; Karen Barton, Community Development Manager; and Nancy Gibbs, City Clerk. Item #1 APPROVAL OF MINUTES OF REGULAR HRA MEETING OF JUNE 21, 2010 M/Rubenstein, S/Quam to approve the minutes. Motion carried 5-0. Item #2 HRA APPROVAL OF AGENDA M/Gepner, S/Quam to approve the agenda. Motion carried 5-0. Item #3 CONSIDERATION OF RESOLUTION IDENTIFYING NEED FOR LIVABLE COMMUNITITIES DEMONSTRATION ACCOUNT FUNDING AND AUTHORIZING APPLICATION FOR GRANT FUNDS FOR WOODLAKE PLAZA HOUSING REDEVELOPMENT PROJECT. S.R. NO. 24 Community Development Director Stark presented Staff Report No. 24. M/Gepner, S/Rubenstein that the following resolution be adopted and that it be made part of these minutes: HRA Meeting -2- Juty 19, 2010 HRA RESOLUTION NO 1075 RESOLUTION IDENTIFYING THE NEED FOR LIVABLE COMMUNITIES DEMONSTRATION ACCOUNT FUNDING AND AUTHORIZING AN APPLICATION FOR GRANT FUNDS Motion carried 5-0. The resolution appears as HRA Resolution No.1075. Item #4 CONSIDERATION OF SALE OF GARAGE AT 1407 EAST 66T" STREET TO OTTING HOUSE MOVERS S.R.NO. 25 Community Development Manager Barton presented Staff Report No. 25. M/Helmberger, S/Gepner to approve the sale of garage at 1407 East 66t'' Street to Otting House Movers. Motion carried 5-0. Item #5 .EXECUTIVE DIRECTOR REPORT No report Item #8 CLAIMS AND PAYROLL M/Helmberger, S/Quam that the following claims and payrolls be approved: U.S. Bank 06/21/2010 Section 8 Checks: 119163 -.119294 HRA Checks: 30936 - 30960 TOTAL Motion carried 5-0. ADJOURNMENT The meeting was adjourned by unanimous consent at 7:20 p.m. Date Approved: $ 165,778.24 $ 33, 758.08 $199,536.32 Suzanne M. Sandahl Chair Nancy Gibbs City Clerk Steven L. Devich Executive Director AGENDA ITEM # 3 REPORT # 26 J STAFF REPORT HOUSING AND REDEVELOPMENT AUTHORITY MEETING AUGUST 16, 2010 REPORT PREPARED BY: REPORT PRESENTER: JULIE URBAN, HOUSING SPECIALIST NAME, TITLE JOHN STARK, COMMUNITY DEVELOPMENT DIRECTOR NAME, TITLE DEPARTMENT DIRECTOR REVIEW: REVIEWED BY EXECUTIVE DIRECTOR: ITEM FOR HRA CONSIDERATION: Consideration of a resolution authorizing the purchase of real property located at 7537 Dupont Avenue throu h the Richfield Rediscovered Pro ram. I. RECOMMENDED ACTION: By Motion: Approve the attached resolution authorizing the purchase of real property located at 7537 Dupont Avenue through the Richfield Rediscovered Program. II. BACKGROUND The property at 7537 Dupont Avenue is vacant and foreclosed. The bank-owned property had been listed at $77,000 and was recently reduced to $60,000. The 794 square-foot house was built in 1946 and has one bedroom and one bath. The original one-car, attached garage was converted to living space several years ago. There is no garage on the property and no potential for constructing one without removing part of the house. The lot is 5,980 square feet. A purchase agreement was submitted to the listing agent and preliminarily accepted. The offer is contingent upon HRA approval. The agreed purchase price of the property is $60,000 plus closing costs and will be paid through the HRA's 08162010 7537 Dupont Ave S Acquisition Housing and Redevelopment Fund. This expense is provided for in the 2010 Revised Budget. III. BASIS OF RECOMMENDATION A. POLICY • The 2008-2018 Richfield Comprehensive Plan states as policy: • Encourage the creation of "move-up" housing through new construction and home remodeling. • The small house is in poor condition, has limited market appeal and will be demolished to accommodate a home that provides move-up housing. • Through the City's Richfield Rediscovered program, the HRA purchases and removes substandard and functionally obsolete housing and replaces it with newer, higher valued homes. B. CRITICAL TIMING ISSUES • The Revised 20.10 Budget is preliminary, so this item is being brought to the HRA to confirm the acquisition based on the Revised Budget. • A purchase agreement was submitted- contingent upon HRA Board approval on August 16, 2010. • The HRA would close on the property by September 6, 2010. C. FINANCIAL • Due to the current housing market, the HRA is able to acquire the property at a very reasonable price of $60,000 plus closing costs. The current assessed value is $150,000 with a land value of $74,000. • Funds are available for the acquisition through the Housing and Redevelopment Fund. • Funding for this activity is proposed in the HRA's Revised 2010 Budget. D. LEGAL • Legal. Counsel has reviewed the Purchase Agreement. IV. ALTERNATIVE RECOMMENDATION~S~ • Do not authorize the purchase of the property. V. ATTACHMENTS • Resolution Purchase Agreement Photo of existing structure VI. PRINCIPAL PARTIES EXPECTED AT MEETING • N/A 3~ HRA RESOLUTION NO. RESOLUTION AUTHORIZING PURCHASE OF REAL PROPERTY LOCATED AT 7537 DUPONT AVENUE WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota ("the HRA") desires to purchase certain real property pursuant to and in furtherance of the New Home Program, said property being described as: 7537 Dupont Avenue Lot 15, Block 22, Irwin Shores Addition; and WHEREAS, the HRA is authorized by Minnesota Statutes Section 469.012 to acquire real property within its area of operation; and WHEREAS, Housing and Redevelopment Funds are available for acquisition purposes. NOW THEREFORE, BE IT RESOLVED, by the Housing and Redevelopment Authority in and for the City of Richfield: The purchase price for the property identified is approved at $60,000, plus closing costs, not to exceed $67,000. 2. The Chairperson and Executive Director are authorized to execute a Purchase Agreement and to take other actions necessary to purchase the property for the amount set forth in this resolution. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota on this 16th day of August, 2010. Suzanne M. Sandahl, Chair ATTEST: Joan Helmberger, Secretary 3a WAIVER OF SELLER'S DISCLOSURE REQUIREMENTS FOR RESIDENTIAI, RFAL PROPERTY AND HOLD HARMLESS AGREEMENT ("Waiver and Hold Harmless Agreement") Seller: Owner of Record BAC Home Loans Servicing LP _ Housing and Redevelopment Authority in and for the City of Richfield Property Address: 7537 Dupont Avenue South, Richfield, MN 55423 Lot 15, Block 22, Irwin Shores Addition, Hennepin County, MN Abstract Property _ __„ (The "Property") Date: August 4, 2010 Buyer desires to purchase the Property from Seller, pursuant to a purchase and sale agreement (the "Agreement") to be entered into between Seller and Buyer. Effective on January 1, 2003, Minnesota law requires that the Seller either provide the prospective buyer of single-family residential real property with a written disclosure of all material facts pertaining to adverse physical conditions in the Property or which the Seller is awaze of, or provide a report conceming the physical condition of the Property prepared by a qualified third party. The law also permits the Seller and the Buyer to waive those disclosure provisions. Buyer (whether one or more) and Seller herby waive, in their entirely to the full extend permitted by law, the written disclosure: previsions set forth in sections S 13.52 to S 13.60 of the Minnesota Statutes Annotated, pursuant to the provisions of section S 13.60 of the Minnesota Statutes Annotated conceming the above described Property. Buyer acknowledges that Buyer has been given an ample opportunity to seek the advice of Buyer's own chosen legal counsel concerning the agreement, the Property and this Waiver and Hold Harmless Ageement. Not with standing anything to the contrary in the Agreement, Buyer hereby specifically holds Seller harmless from any claim or claims made by Buyer, Buyer's successors, assigns, hears, insurers, agents or any other person or entity, as to any matter involving the disclosure set forth in sections S 13.52 to 513.60 or claims made against Seller, at any time, concerning the disclosures set forth in sections 513.52 to S 13.60 of the Minnesota Statutes Annotated concerning the Property made by Buyer, Buyer's successors, assigns, heirs, insurers, agents or any other person or entity. The parties herein agree that except as otherwise provided herein, the Agreement provisions shall be in full force and effect. This Waiver and Hold Harmless Agreement shall be binding and inure to the benefit of the Buyer and Seller and their heirs, successors, assigns, agents, employees and officers and shall survive the closing of the sale of the Property pursuant to Seller: By: Its: 3,3 M.S.B.A. Real Property Form No.1 (19sq; Rev. 1996, Rev. 1997; Rev. 2002; Rea 2004; Rev. 2005; 2007; 2008) Min esota Standard Residential Purchase Aareement PURCHASE AGREEMENt /PAGE 1 Of 10 MINNESOTA STANDARD RESIDENTIAL PURCHASE AGREEMENT ©Copyright 1996,1997, 2002, 2005, 2007, 2008 Minnesota Sate Bar Association, Mktneapolts, Minnesota BEFORE YOU USE OR SIGN 7HIS CONTRACT, YOU SHOULD CONSULT WITH A LAWYER TO bETERMINE THAT THIS CONTRACT ADEQUATELY PROTECTS YOUR LEGAL R(GHTS. Minnesota Stara Bar Association disclaims any IiabiAly artsinp out of use of this tone August k, Z~10 I 1. PA,~iTAIES. This Purchase Agroamanl is matle on , by antl between 2 _,inc., rWF~C"". LV Rt"~ "~t;•lr-Vt Lt t1F[~_y~/ 3 (manta( slalLS] i of fsellefseddressl t~L V LJ ~ -'"`(.~ ~ 7 b { SELLER and s Huuslt~ and Rednvelnop{~,Ag~pyjty in and tar the City df Ridd'ield. a pdb-ie 6odv carddrata and poUtie under the laws of Minnt~sirta a as joint tenants (strike joint tenants" it tanancyin-common IS intended[ of (buyer'saddressJ 670U Portland Avenue 5auth. RiehfieN, MN 5542. 7 ,BUYER. a ~ 2. OFFERlACCEPTANCE. Buyer aBers to purchase antl Seller agrees to sell real property legaky described as: u ~ i ~ S u l,` ~Z...2 ~~- ft- W ~ ~ '~ ii~'Q,. c S ~ 1'~ t T~t a.~ _ . t, ~. 13 IS ~I j la [Property Tax Idenlitieation Number or Tax Parcel Number _ ~'7 ' (l~-~ " ~' ~'T f "" t~8 r`r Z 1 ]T la Iocetadat ['713 ~i.t ~ ~ ,Ckyol it-l~-Y~"~"iL~ t-(J iv County of N' State of Minnesota, Zip Code mil'/ 2 3 to ?1 ]. ACCEPTANCE DEAD LINE Thoewaptanl:edeleofthisPurchaseAgreementisthsdaledisdeliveredbylhelastpartyslgmnptotheotherpatty. ._ This offer to purchase, unless accepted aoaner, shall bo void at 1 t:59 A.M., on (dale) ,and in such event all earnest i3 money shall ba retuntted to Buyer. }3 33 3a 33 3G 37 7a 79 ao at i3 i3 is a3 ar i7 as a9 311 SI s? 53 SS 33 7G S7 3a s7 4. FIXTURES AND PERSONAL PROPERTY, For Ute purposes of utis Purcttesa Agreement'FiMUres' ate kema that are embetldotl in the land ar attached to the buitding(s} and cannot ba removed without damage to the rest progeny. The ml3lttod tiY which the Axture is 'attached' avid be scows, nails, adhesives, or any otharmechaniwl mmtecllonvrhicttshowa Sollofs intent td make thohem a relebvelyparmanenlpart of the real estate Examples of fixtures are doore and cabinets. 'Personal properly' inGudos dams thetare not attadtad to the build'mp(a) or ambatldad in 1ha land and thatararemovablewiUtoutdamagololherealpropeny. Examples ofpersonalprapartyarefree-standing(hat'bulltin')a[Spliancasendituttilura. Suyar and Seller shaultl eonaider carefully the failures and personal progeny to ba IrtGtWed in the sale. For example, a mlrcor attached to a wag by arrows or nabs is a fixture, while a minor hung from a Imit Of picture hanger is personal. property. A. FIXTURES INCLUDED IN THE SALE. Title to fadtrres passes to Buyer with the deed. All fixtures except those excluded at B., below, are irtcfudod vi This sale such as: garden bulbs, plants, shrubs, bees, tendseaping, storm windows and 3nsens, storm doors and inserts, screens, awnings, wintlow shades, blinds, anain-treverse~drepery rods, mirrors, door mirrors, gbinets, counter lops, doors, door hardware, mantels, woodwork, at(achedtightingf~ctures withbulbs, elegrical widng, daeuieouUets, eledricswitchas, elearieouUat ptatesand awkchplatas,all plumbing and pip,rtg, plumbing fixtures, sump pumps, water heaters, heating systems, heating slaves, fireplace inserts, Ureplaee doors 8ndsaeans, built-in humiddiers, buitt•in air conditioning units, built-in elearonie air fillers, autamatie garage doer openers wkh controls, tefeviaian antennas, satekito dishes, vratetsofleners, built-in dishwashers, garbagadisposals, built-in trash axnpactors,built-inovt3ns and cooking stoves, hood-fans, intercoms, mslalletl carpeting, built-in work benches, security systems, fences, retaining waits, klmnets, gates, survey monuments, culverts, sheds, gazebos, trellises, urmerground'srigationsysrems, weathervanes, Gghtninp rods, flagpoles, light poles and lights, outdoor statuary, pumps, mail boxes, mail box posts, and newspaper boxes B. FIXTURES EXCLUDED FROM THE SALE. Tha fogowing factures era axeludod from This sale and wgl be removed by SeAsr phor to closing: Any tlamaga to the rest property that ocaus in Setter's removal of these factures wiU bo repaired by Seller prior to Dosing. The tollowinp excluded and ramaved fixtures will ba replaced by SeAsr wish a ftmcUonal egirivalaicL' At closing orpriof ieClOaing, Seller shall provide forpayment of, salisfadion aL orraleasa of any existing Aens, claims, or encumbrances on the fixtures, except tot the fallowing encumhranlx3s whkh Buyer accepts ar assumes (Gst heraJ. C. PERSONAL PROPERTY. Any personal propenyto be purchased by Buyer is listed on the attached Personal Properly Agreement. 5. PRICE A~ TERMS. The price for the real prapeny is t ~CT"t "T Yt'ott,5 (M1(3 ~o t, t,.. t't't~-i Jl~ty p c£%,o ~~ Dollars (s...~2~~- ' .). which Buyer shall pay as fnGOws: Earnest money of S~ ~ ' L4 (:~ by {CASH, CHECK NOTE -state which} e. NEB. fit:.. payable to )select sae:) ~ Salter, to be deposited and held by Satler (and maybe commingled wish Sellafs other funds} pending Dosing, ~ Beliefs lawyer, to be deposketl antl hard in the lawyefs Wst accaura pending dasing, '(}~ Seller's broker, to be deposkotl M held by hrokeraxording to the requirements of Minnesota Statutes. ~ Other (describe how the earrresf money wit! he held) receipt of which is hereby acknowledged and S pah, an .the DATE OF CLOSING, and the balance of 5 by financing 8a shown on the attached tinancing Addendum. 6. DEED l MARKETABLE TITLE. A. Upon pltnormance by Buyer, SeAsr shall execute and deliver a ~.-) M l T•~ 1? Warranty Doed, Jafned kt by Spouse, if any, wnveying goad end marketable tUle of record, subjalx to the foAOwinp Title Exceptions: {1} Building and Zoning laws, ordinances, state and federal regulations; and (2} The lien 6f real prdperty taxes and the Aen of special assesamoms and Interest due thereon, it any, payable in the year of closing which by the terms Ot lhb Purchase Agreemoni are to ba paid or assumed by Buyer B. S911er proposes to Buyer ttsat Sekofs good and marketable UAa wiU be delivered to Buyer el dosing subject W 1ha tallowinp tale Issues: )Check (1J, ifappfrcaofe:J {7) DEneumbrenl;es,easemanls,covenants,cprtdilions,restr{Ctipna,adadaretion{wdhoutanasst3l:iation),andresl3rvalionofmineraldghts by the State of Minnesota, as disdosad in M.S.BA Real Property Fonn No. 19, ADDENDUM TO PURCHASE AGREEMENT: TITLE ISSUES {2005), attached es a pen of this Purchase AgreemanL 3 '~ M.S.B.A. Rest Property Form No. 1 (1994; Rev. 1996; Rav. 1997; Rev. 2W2; Rev. 2004; Rav. 2(}05; 2007; 2008) Minnesota Standard Residential Purchase Agreement PURCHASE AGREEMENT !PAGE 2 Df 1D 9a 93 96 97 9a 9'~ tan tot tae 1a7 iw l0s Ies 187 1U8 tai u0 ur 712 II3 t to its its ]17 178 119 I20 1zt 127 f23 I2a 723 !2fi 127 128 129 I30 731 732 127 13a 133 176 U7 ua 179 tea tat Ia2 la3 lea ws lab ta7 wx Ia5 Ise 1s1 132 ISf ISa Ies 1s6 137 tss I39 160 I61 162 163 IGt 3Gs I6fi 167' 16B 169 n0 771 to l7J l7a 17s u6 777 778 179 I88 161 (Check (2J, ifapplicatrle:J (2) QAOecfaratwnofcovenants,conditions.andrestndionswilhanazsodaaoninapfannedcommunily,candominium,ormharoomman interest ownership commurdry, az disdosed in M.S B.A. Rent Property Fonn No. t2, ADDENDUM TO PURCHASE AGREEMENT COMMON iNFEREST COMMUNITY attached as a panof this Purchase Agreement. jChnck (3), if applicable:) (3) QTharighlsoftenantsorotherpartiesinpossessicn,asdisebsedinM.S.BARaeiPropertyFartnNo.20,ADDENDUMTOPURCHASE AGREEMENT: TENANTS AND PARTIES IN POSSESSION {2005) attached es a pan of Ibis Purchase Agreement. Although Sallar has dlsctosed these Utle issues and Buyer has Irttllcated a general willingnoss to take title suh)eet to these tlUe issues, thosotltlslssuosaresubjact mtheatlterprovlsfonsofthaParohasoAgrnemontandtoanoxaminationottlUebasaduponthaMinnasota Tftla Standards and upon Minnesota law. Buyer also reserves the right to evaluate Ihosa title issues in fhe light of Boyars intended use and enjoyment of the property. Buyer shall have until the and of the paned for stating Title Objections under Paragraph 14., of this Purchttae Agreement to make the evaluation and determine i( those tttfe issuos willaHsa Buyer's intended use and enjoyment of iha property. Except for matters disdosetl under B.{2}, above, and gavemad bythestatutory remediesreferanced InM,S.B.A Real PropartyFOrm N0.12,ADDENDUM TO PURCHASEAGREEMENT: GOMMON INTEREST COMMUNITY, if Buyer, in Buyat's solo diseretbn, detamtines that Ihese !Ale issues wig advaroely aHed Buyer's intendetl use and enjoyment of Iho property, Buyer may deGare this Purchase Agreemem void bynotice to Setter, neiutetpeny oboe be liablalordamegas hereunder to the other, and earnest money stroll be refundetl to Buyer. If the paned for stating Title Of>jedions under paragraph 14., passes without Buyers decbring that these title issues will adversely effect Buyers branded use antl enjoyment of fhe property, Than, subjed to Sailers wvenattt to deliver a goad and marketable tl1le of record, Buyer shall take title subject to these alle issues. (Salter Shoald conalderfu8 disclosure of at! cue Issues 1o Buyer in this Purchase Agreement Orin addenda 1o this Purchase Agmement. Ftlgdisdosuns as to fhe substance of Gfte issues allows Boyar an eady opportunitybensurethatthisistherfghtpropertyforBuyerandtomeasurathe/mpadohthaBUyeYs fnlendeduseorpotenGa/enjaymentoflire property. to other words, BuyeYS consent fo take Hfle subject to fhe existence of AUe issues must be a fully informed consent. if Buyer is fuAy tntormad eady, if is less likely that Buyer will elect iQ vad the AgreemenLJ 7. REAL ESTATE TAXES AND SPECUIL ASSESSMENTS. A. PdwYears~ Dalinquant Real Estate Taxoa and Dolinquont Spac(al Assastlments. DeGnquem reaiesiata taxes payable in years pltiorfo the year of ebsing and delinquent instalimatds of epeeist assessments verified for coaectian with real estate lazes payable in years poor to lho year of dosing, together with penalty, interest and ws1s. shall ba paid by Seller oat later than Iho actual data o[ closing. B. Rasl Estate Taxes Payable in rho Yoar of Closing. Real estate fazes payable in the year of dosing shall jselect from (7) or (2).) (t) Be prorated between Seger and Buyer (sated (a) w (bjj: (~'j ~ On a calendar year basis to 1ha actual date of closing; ~y~-( {b) As follows: Saner %; Buyer :fi; adju a balweenSellarend8uyeretdosing,andpaidtothscountyatdosingifihendueandBuyershal(essumainslallmantsnot paid at tieing. (2y Not ha prorated and the entlre year's taxes shall be (select {a) or (b)j: (a) Paid try Seller when due, twt not later than closing, (b) Aswmed by Buyer, to be paid when due and not later than ebsing if due prior to dosing, and Buyer shall reimburse Salter at closing for any insiaifinent5 paid by Seller prior to erasing. Seller shall pay penalty, interest and Casts on any delinquent installment of taxes and spacial assessments payable in the year of Wasing. If dosing is delayed to a later year, real estate taxes payable in the year of dosing shalt ba prbralad between Seller and Buyer an a calendar year hazls to the actual date at ebsing.. C. Tax Statomants. if lax statements for texas payable in the year oidosing are not evailabla on fhe Data of Closing, Iho amount to be used for dosingp asesshallbejj,Q%oftheprioryearstaxas,andsuchambuntshalibejsekdone FULL ANDFINALBETWEEN5ELLERANO BUYER ADJUSTED UPON RECEIPT OF TAXSTATEMENTS FOR SUCH YEAR {in which ease the pony obligated to pay lha ad)asU»am shall pay it to Iho eater parry within 30 days of issuance of the tax statements). D. Homostoatl ClasslBeatlon. Seiler represents IhaL as of Iho dale o(Ihis Agreement, Iho property tax dassiaeaaon is ' e one 1 nonhomeataad. If the property is nonhomaztead, Buyarmay change the lax dassfication torlaxes payable in the year fapowing dosing by taking possession Of ate real property as Buyers homestead and filing a new homestaatl dedarabon wghin the time requlre0 bylaw it rho property tax Gazsification in the year of dosing is no! homestead, Salter shell pay to Buyer at dosing jseled onaj ~tha difference (on Buyers portion of Iho taxes) between the fazes in the actual dassifieaaon and the lazes that would hove been payable under hamestaad dessifxatbn. if the property tax dassdzabon for taxes peyahte in rho year folhnvirtg closing is not homestead and. through no fault of Buyer, the closing lakes place aftartha data bywhirb Boyar must take possession of Iho reatpropariy as Boyars homestead to fda forhomestead lax status torlaxas payable in such ear, Seger shall pay to Buyer at Ggsing (select one( ~he diffarentxi (an Buyers portion of the faxes)tletween fhe taxes in the aGuat dassif~eation and ate taxes that would have bean payable under homestead dassficaGon. l!f Buyer intends to Gaim the property az BuyeYs homestead, Buyer should Gk BuyeYs homestead deGaretion as soon as possible eRer raking possesslon and otxupancy of the properlYl E Deferred Roal Estate Texas. jserectona:j Q BUYER ~ SELLER shell pay on dale of ebsing or provide !ar payment o1 any defamed real estate taxes{induding'GreenA~res"taxes underMinnesota Statutes Section 273.111) payment of which is regtrirod as a result ofthe dosing of This sale or fhe recording d the Dead or Contract far Dead Provision for paymem shoo ba by payment into escrow o/ 1.5 times the estimated amount of Iho assessors reassassmem tar deferred taxac. F. VatuaUon Ertdusions from Assessed Value. SeBerwarcams and represerdc that ate property (sated one:) Qdoaa ®dooa not have an azdusion from asfimatedmarkalvelue for canaihhome improvements pursuam to Minnesota Statutes Section 273.11, Subd. t6 {7997), Such exdusibn expires on fhe safaof fhe property and will cause Iho assessed value of the property to increase for property tax purposes. The increase ih assessed value wig cause ttleprapeny blues to increase and might makatha property unaNardable for Buyer. If Boller represents that the property does not have an exdusion and an exdusion is d'ucavered prior to dosing, Buyer may, at Buyers option: (t) Assume payment of the increased property faxes wMout adjustment to fhe purchase price of the real property; (2) Require that the pnee of fhe property be etluead by the estimated increase in property taxes over the threD calendar years following the year 0/ dosing (such estimated inCfaase shalt ha ohtahed from the eouMy assessor or city aesasear}; Or. (3} Rascintl this Agreement, in which Baas all earnest money shall be rofundsd to Buyer. If too exdusbn is ratdiswvaretl until after dosing, Seger shall bo gable to Buyer for Ilquidated damages in Iho amaunllhat is avo limos the eshmatad 'utarease in real estate texas based on fhe raazseased value provided That any notice d a Cbim Of breach Of warranty must ba in writing and must be given by Boyar t0 Seller within one year of the Date of Closing 0< 710 deemed waived Tho provisions of this Paragraph F., shalt survive Iho delivery of the Deetl or Contract for Oeetl. G. CertiRad Spoolal Aasassmonts.Allinstallments otspecial assessments eenffied for payment with the real estate taxes payable in the year of ebsing shall ba jsefed onaj: ~ ProratetlbelweanSellerandBuyaronecalendaryearbasistofheadualdateofclusing,adjustetlatdosing,antluntessothanwaoprovided in this Purchase Agreomani, shall be paid at ebsing ~ Paid Dy Boyar at dosing ® Acrid by Seller at dosing CJ Assumed by Boyar. H. Pending Spatial Assassmertts. (sated one:(®BUYER SHALL ASSUME PAYMENT OP SELLER SHALL PROVIDE FOR PAYMENT OF special assessments pending as of the dais of ties Purchase Agreement for improvaatems that have been ordered by rho City Coundl arathar 3.h M.S.BA Real Property Form No. 7 (1994; Rev. 1996; Rev. 1997; Rav. 2002; Rev. 2004; Rev 2005; 2001; 2008) Minnesota Standard Residential Purchase Agreement PURCHASE AGREEMENT /PAGE 3 of 10 Ifi2 tai tea lee ta4 Ia7 IBa lag 19D 191 192 193 I9a 193 194 197 198 199 2oa 201 202 202 2w 2os 2a4 207 gas 209 210 211 212 213 21a 213 214 217 21e 219 22D L'1 222 227 22a 223 22G 227 22a 229 270 271 232 233 27a ?7S 23s 277 va 239 tag gal 2a2 2a3 2aa 2a3 2aG 2a7 gas 2a9 2so 231 232 233 233 233 2s4 237 2sa 239 2fi0 241 242 243 2fH 24s 24G 247 -aH N+9 270 271 272 273 govammantal assessing aulhotitiss. {Seller's provision for payment shall be by payment into escrow of 1.5 limes the esturteted amount of the assessments.) As of the date of this Purchase Agreemam, Salter represents that Salter haz not received a Ntltiee of Hsarcrg of a now public improvement prtlject from any girvemmenial assessing authority, the costs of which project may be assessed against the real property. If a special assessment becomes pending after the data of this PtmdtaseAgreamant and before the pate of Closing, Buyer may, at Buyers option: (1) Assume paymam d the pending special assessment without adjustment to the purt9rese price of the real property; or, (2) Require Setter to pay tits pending special assessment (or escrow tar payment of same as provided above) end Buyer shall pay a commensurate mtxease in the purchase pries of die real property, which inereasa shall be iha same as the asitmated amount or the a5aeaemeflk Or, (3) Rescind this Agreement, in which case all camas! money shell ba refunded to Buyer. I. DafarredSpaclatAsssssmants. (seledoa9:J08UYERl~SELLERShellpayondeteofdosingorprovidoforpaymantof anyde(sned special assessments payment of which is required es a reauft df a dosing of this sale or the reetlrding(filing of the Dead or Conlred for Dead. Provision far payment shall be by payment into esaawof 7.5 times the estimated amount of the deferred specal assessments. J. Au Other Levied Speelal Assessments. (select. ona:J BUYER SHALL ASSUME PAYMENT OF J [SELLER SHALL PAY ON DATE OF CLOSING all other special assessments levied as of the dale of this Purchase Agreement, except deferred special assessments (wvered at Paragraph 7.t, above) K Taxes and Special Assessments in rho Years Following Closing. Buyer shall pay real estate taxes payable in era years following dosing andspecialassessmantspeyablethertswith,ihepaymemotwhictrisnolalherv+iseprovidedheretn. SaBermakesnoreptesentationconeemingthe amount of future tact estate lass or of future special assessments. 8. DAMAGES TO REAL PROPERTY. UnGi txunpielion of ebsing and delivery of possession, all risk of lass is an Sallar. If the real property is damaged prior to dosing, Seger shall give notice to Buyer wktdn 3 business days after sudt tfamage has occurred. The notice shall indutlo Sellars proposal for repairing iha damage. From the dale that Htryar revives Sollars notice, Buyer shall have 3 business days to inspect the real property, and an additional 2 business days to determine K fhe damages and Sellers proposal for repairs era acceptable to Buyer. If Buyer does not atxept Selers proposals for repairs within the 2 day. period, this Agreement is cancelled and the oamast money shall be refunded to Buyer. 9. SELLER'S BOUNDARYLINE,ACCESS, RESTRICTIONSAND LIEN WARRANTIES, Soltar watrenls that buildings, if Srty, era 9rtUrely wilhinfha boundary lines of the real propedy. Seller warrants that there is a right of access to the real_propmty from a public right of way. Seller warrants that there has boon no labor ar material furnished to the reel propedy for which payment has not bean made, Seiler warrants that theta era np present violations of any restrictions relating fo the use or improvementol the real property. Sellarvrarrantsrhat the real property is no[ subject to a lien for Medical Assislanca or olhar public assistance. Those warremias shall survive the tla8vary of Iha Deed or Centred for Deed. t0. CONDITION OF THE REAL PROPERTY. A. Statutory Disclosure. Pursuant to Minnesota Statutes Sections 513.52 -513.60, Seller must provide a written disclosure {sae (1) below), or Buyermust have received an insptldian report[sea (2) balowj, or Buysrend Sellermaywtriva thewrftten drsclostus requirements (see (3) below). fifinnaota Statute Secdon 513 37, Subd. 2 L1AB[LITY Asdlcrwho fails w make a t8ulosure as required bysetaions 313 52 m St3 00 and wet aware of matcrid face pertaining to the real property is liable to tbrprospemive buyer. A person injured by a violadon of this section may bring a dull action and recover damages and receiveother equitable rdidas determined try the men. Act sedan under this subdivision roller be trommenced within two years aRer the dart on which the prospcedvc buyer deed the purcLase ar transkr of die real property. (SNect only ono of these lhrea~J (1) SalkYs Dlscloswo. Sailor has provided a written disclosure to Buyer. A copy of Sefters disclosure is amaehetl Seller shall correct in writing any inaccuradas in the disclosure as soon as reasonably possible bolero dosing. Minnesota Statutes Stcdoo 313 53. GENERAL DISCLOSURE ItEQU[REfitEN75. Subdivision 1. CONTENTS. (a} Hcfarc signing an agreement to sdl ar transfer res)dcadal ttal property, the sdltt stall matte a wdtkn diselosuzc to the prospcedvc buyer. The disclosure must include dl material face of which the sdler is swam that could adversely and 9gnificondy affeet• {1} an ordinory bsyers tree and mjayment of the property, a (2) any intended usaof the property of which the sdller is aware (b} The dixlosurc must be made in good faith sad Lased upon the best of the sdlers knowledge at the time of the disclosure Mimrewm Stanua Seedon 513.38. AfifENDMENT 70 DISCLOSURE. Sub&vision t NOTICE. A sdlu muzt nodfy die prwpective buyer in wddng as soon as reasonably possible, but in any event before closing, ifthe sdller learns that the sdlera disciowrc required by Section 513.33 was inaccurate. Subdivision 2. FAILURE TO NOTIFY;L1AHtLITY.Asclieswhofailstonarifytheprospaetivtbuycrofanyomendmmltstotheinidddisclosurarcquired under subdivision ! is ]iablc to the prospenivc buyer u provided in Settles 513.37. Q (2) inspocdon Report. Buyer has reeelvad an inspection report by a qualified Third-parry. If a wpy of the inspection report is provltlad to Sollar, Sellersttall d~sdose l0 8uyermalerial fads known to Seller that contradict any infarmatlon in the insptsctlon report. Minneow Statutes Section 513.56 Sttbd. 3 INSPEl3fONS {a) Farcept as provided in PomBnph (by, n seller is not required to diulox in.°armadon rdndng so dw teat property if a writmn report rho[ direloses the informasionhasbceaprcparcdbyaqualtficdthirdpartyandprovidedmdteprospeaivcbuyer. Forpurposcsofthisparagmph,'qualifiedthirdpany' morns n federal, state, or local governmental ogeaey, or my penan whom dtc xllu, or prospativc buyer, reasonably bdicve Itns the expertise necessary to mat die industry smndards of pmeda for die type of inspecdon ar investigation that has bcea conducted by the dtiN pony in order to prepare the written report. (b) A xllcr shall disdose to die prospeetivebuytt materal facts known by the sclltt that eontradia say information included in a written report under paragrepir (a) if n copy of the report is provided m the adltt [~ (3) WaivorofDlselosuro. Minncsma Sumtes Seedan 313.60 1YA[VER The written disclosure required undo Seed 3l .32 to 3 ti0 may be waived if the roller and the prwpective buyer agree is wddng. Waives of the ditclasure required seder Sections 5!3.32 s .dad of waive, timer, dge an tgation for sellttdiselowrc erected by any whet law. Seller and Buyer waive rho wdttan dlsdosure raqulred under Sotltio to ].B . Jr~ SELLER: B R: ~s`L _ S-ieoPv` t.. j~kycttij~rff~cfv+~tl~c~. ,s7f~,~vc/~~ SELLER: BUYER: ~-"' "( J~{wt^~'~`-u`s'K ~ ne(N. Srs•~cbttr Uaw'r~rS~. NOTICE REGARDING PREDATORY OFFENDERS: Information about the predatory often r retry and persons registered wdh a registry may ba obtained by contacting the total law enfareemem agmtty a by txmtading the Minna Oepartmtmt al Corrections at 651-361-7200 of at httpJhvww.doc.atata,trm.us. 27a 3~ 275 27G an 278 274 tad 2e t 287 2aJ 283 28G 287 286 2s9 240 241 242 297 29J 243 21G 297 248 2r~ 3tq 301 702 3UJ ]a ]as ]tlG 707 ]aa 3U9 7w 31l 312 313 31J ]t3 7tG Jt7 318 3l9 7zo 721 322 323 32J 323 32G 327 sea 329 ]3U 333 372 333 33J 333 33G 337 338 ]s4 7Ju 3JI 3J2 JJI 3JJ 3J3 SJG 3J7 JJB N9 SSs 731 333 337 35J 733 3SG 3s7 3se 739 3611 3G3 3G2 3G3 sw 3G3 3GG 5G7 3G8 3G4 370 M.S.B.A. Real Property Form No.1 p99a, Rav 1996; Rev. 1997; Rev. 2002•, Rev. 2004; Rev. 21705; x007; 2009) Minnesota Standard Residentla! Purchase Agreement PURCHASE AGREEMENT / PAt3E 4 of 10 B. WELL DISCLOSURE. (Cheek one ofthe foNOwing: J 0 Se $'er eertBas that Seller doss not know of any walls on the [eel progeny and wiA so eerliry on the Daed or Contrad for Daed deiiuarsd at in9• Q Wells onlherealproparryaradisclostrdbySellerontheattachadM.S.B.ARealProperlyFormNp.21(2005),WoflDiselosureStatamsnt. C. SEWAGETREATMENI' SYSTEM DISCLOSURE. (Check either (1) or (2): J Q(1}. Sallercanifiesthatsewagegeneretedatthepropanygoesto ofadtitypannittedbylhaMinnesotaPallutionControlAgeney(forexampls, a coy or mtufidpal sewer system). ~](2). SeOer rsnifias that sewage gen~ratedat the praparly does not go to a fadlBy parmkted by the Minnesota Pollution Control Agency and Sellars Disclosure of Individual Sewage Treatmem System is attached {a9ach form). (Check either (3) or (4): J 3y, Boller does not know if theta is an at3andanad individual sewage oeatmeM system on the properly. 4I. Seller knows that there jstrike one:J ors 1 aro no abandoned'srdividual sewage treatment systems on Iha property. if Seller tliseloses the axktenea ofan abarxlaned individual sewage treatment system on ate property, Than Mtnnesote taw requires that the location e/ the system be disetosed to Buyer with a map. (Attach Seflar's Disclosure df lncrvidual Sewage Treatment System with map completed.) D. LEAD PAINT DISCLOSURE jCheck one o/the Ioporwng: J Seller represents that the dwelNng was constructed on 1ha rest property H 1978 or later. Seller represents that the dweaing was donstruded on the rest property before 1979. (If such housing is totaled on the real property, attached and made a pan of Ibis Purchase Agreement is M.S.B.A. Real Property Form No. 11 (1996), LF1iD PAINT ADDENDUM FOR HOUSING CONSTRUCTED BEFORE 1979.) E. HAZARDOUS SUBSTANCES, PETROLEUM PRODUCTS, AND UNDERGROUND STORAGE TANKS. Ssllor knows ai no hazardous substances ar petroleum products havingbeen placed, stated, arrelaased from oron the real proparry byanyperaan in vidstion of any law, nor of any untlorgrountl stomgd tanks having bean located on the rest property at any lima, except as totlaws: Iltha presence of underground storage tanks (a disdosad, then Ihip paragraph applies: Sellerhareby represents and warrants to 6uyerihat all of the underground tanks known fo Sollar on the subjad property have bean diseiosad to euyar an the attached drawing or map. Sailer Shall provide at erasing lho aflidavils requirotl by Minnaeole Statutes Sections 1156.18, Subd. 2, and 118.48 if applicable to the subjad property end torero an affidavit attesting to the location of any underground tanks whirb are used for the storage of petroleum products. F. PROTECTED517FJ'a. SellarhasnoknowledgadlatlheprapertyhasanyeondBionsthatareproteetedbylederalorstalelaw{suchasAmsrican Indian burial grounds, slhar human burial grounds, ceremonial earthworks, hislorieal slructuras or materials, or areheotogical sites) . )Check thelroxifthafollowingprovisionepphesloThisFurcbasaAgrpementJ ADDENDUM TO PURCHASE AGREEMENT: CONTINGENCIES FOR SURVEY, APPRAtSAG DEVELOPMENTEVALUAIION, AND ARCHEOLOGICAL! HISTORICAL SURVEY, M.S.B.A. Real Property Pane No.17 (2005), is 1ncWded as an addendum to This Purchase Agreement G. DISEASED TREES. Selierhas not received any notice from any governmental auatodry as to the existence ot, and SeOar has no knowladga at, any Dutch elm dtseasa, oak wilt, or other disease of any tress on the real progeny. H. MECHANICAL SYSTEMS. Salter represents Ihat all fixtures, heating and atr condidoning oquipmem, Oreplacas (indudtng medtanisms, dampers, flues, and doors), wiring, and plumbing used and ideated on the real property wi0 be in warkktg order on the Oats of Closing. For the purposes of this Purchase Agreement,''xt working order means thel Iho ilam fundidrrs far the purpose that it is intended to pedorm, that h is net to violation of any public woos ar regulations (atOtough d may be Iegagy ndncdMonnirtg under current law), that it does rot presently Hood raplacemam, deaning, repairs or service, that k is not missing any assentiatparts, and that its any impaAecdons are'wsmatic' orsigns of `wear and tsar' associated with a productaf ifs ago I. WET BASEMENT. Sollar (sMko one) has 1 has not had a wet basemen4 J. RDOF. Seler (stake one(Fms /has not had a leaky roof. K. UTILITIES CONNECTIONS. Seller represents thattho property is ddnnadod to: cky saver (smke one) YES 1 NO; dry watet(sMka one) YES! NO; cable eommunieahons (atnka oneJYES / NO. t CLEANGONDITIONS.Setlersftalicemovaelidafuis,lrash,tubbish,gefiapa,rubble, andyardwastefromgsetandbeforethopossoesiontlate Salrershall remove all trash, garoego, and miseeiWneoua discatdad mattxlels from d1e WAdings, and shall leave the buddinga in `tNdom dean' conditionbeforedtepossessinndatn Saliarshallremoveatlpersonalpropanynolindudedinthissalefromtharealpropartyt3efdrapossession dais. M. BUYER'S INSPECTIONS. Buyer may have mspeelbt3s of lha propertyeonduded prior to dosing. (Check the box )ttha /allowing provision applies ro Mls Purchase Agreement] f~l ADDENDUM TO PURCHASE AGREEMENT: BUYER'S HOME INSPECTION CONTINGENCY, M.S.BA Real Propotty Fdnn No. 15 (2 5), is induded as an addendum to this Purchase Agreement N. METHAMPHETAMINEDISCLOSURE. (Cheekontyonebox,either(1)or(2).j (1 } To the best of Sollars knowladgo, malhamphelamina Ixodudion has not occurred on Iha property. (2} To the bast of Sailers knowledge, methamphalamina produdion has occurred on ilia property and Seller's tlisdosura is continued in Part B., METHAMPHETAMtNE OtSCLOSUAE STATEMENT, M.S.B.A Real Property Form No. 22 {2005), included as an addendum to this Purchase Agreement 0. NOTICEOFAIRPORTZONINGREGULATtONS.IfeitportzoningreguletionsafteathisrealpropeAy,acapyofOwseairponzoningregulations as adopted can bs viewed oT obtained at the attics of Iho Wunty reeoMer where the zoned area is loraled. P. WARRANTIES SURVIVE CEASING. S9aerswanan5es and reprasentetions contained in this Paragraph 10., shah survive the delivery of the Dead dr Contract far Deed. This Paragraph 10 ,shall not change araHed any rights Iltet Buyetmighthave underlheUniform Commercial Cdda [Minndsma Statutes Seetion3362- 312j, or underMinnesota's "Prevemidn of Consumer Fraud Ad' pNinnesoW Statutes SeeGat3s 325F.66-.70). dr under Minnesota's'Homaowners Wananty Ad' [Minnesota Statutes Chapter 327A); nor shag it predude Sellers liability far an action for freuQ negligent misrepresentation, or other adions atlowed by law (Mevtasata Statutes Section 513.57.) 11. DISCLOSURE OF NOTICES. Segerhasnotrseeivedanynolicefromarlygovammentalauthorityastaviolationafanylew,otdinartcearregulalion afioding the real property. It the real property is subjad to restrictive covenants, SeOer has not received any notice from any parson as to a breach afthecovenants. SaUsrhasnotreceivadanynoticafromanygovemrnentalauthddrydonceminganyemctentdomain,eondamnation,spedattaxing dislrid,orrezoningprocesdings. SellarsrepresentadonseonteinedinlhisParegraphll.,shellsurvivathadalivoryafthaDesdorContradiorDead. 12. 7RUTN•IN•HOUSING. Buyer acknowledges receipt at the 7rulh-in•HOUSing Disdosura Report or olhsr inspedfan report if required by the municipality in which the reel progeny is toCated. 13. POSSESSION. Seitar shall deliver possession at the progeny Hat later than t {+~ ~ 01 ~C'CiG ty-~ Ys F"'(~Q- closing. All interest, fuai od, liquid pouoletrm gas, and ell charges tar city wafer, city sewer, e(edridly, and natural gas shall be prorelad botwsen Iha parties 3 ,1 M.S.B.A. Real Property Form No.1 (1994; Rav. 1998; Rev. 1997; Rev.20o2; Rav. 2004; Rev. 2005; 2007; 21708) Minnesota Standard Residential Purchase Agreement PURCHASE AGREEMENT / PAGE S Of 1Q 371 371 377 7T3 113 37G 377 378 3r~ 3tlU 781 382 383 Tai 783 7eG 367 388 389 J9u 391 391 TJS 391 393 39G 197 398 399 3tN1 lot 3U2 iaT 383 ies SOG tut 1U8 3U7 im ill 312 it3 iW its 31G ill ila i19 ate alt s22 323 323 i3 32G i27 328 329 iso 331 332 3}J a3i i3s ;JG iJ7 S38 sin fin N) 332 337 iii 313 i3G 337 318 339 iso i31 332 333 i!3 335 33G 337 138 is9 iGU 3GI 162 3G7 14. TITLE, A. A$STRACTANDEItAMINA'fIONOFTITLE. TotlemansfratsihetSa9er'stiUeisgoodandmarkelabbo(record, withinareasonablstimeeder aaeptanca otThis Purchase A9rearnonL Salter shall furnish 8uyerwim en Abstract of TNe (sea &, below] dra Registered PropertyAbstrad carti0ed to date including proper searches covedng banWupiaas and state and ledarel jutgments, federal court judgment liens in favor of the U.S., liens, endleviadandpendingspacialassessments. SuyarshallNavetentrusinassdaysafterreeaiptoftheAbstrectofTilteorRagistaredPropertyAbstract either to have Buyers l avryer examine the title and provide Seller with written Title Objections or, at Buyers own expanse, to make an appOwtiort foretitleinsurancepoUeyandnotiySallaraflheappUeation. Buyershallhavstanbt~inessdaysaderreea1p16tlhaCommitmentlarTitlslnsurance to provideSellarwimaeopyotlheCommamentandwriUenTiUeObjedions. BuyershalibetleemediohavewaivadanyTideObladicnsnol.made within the ten day pedod above, except that this shall not operate as a waiver of Sellers covenant todeliver a statutory Warranty Geed, unless a Wananty Deetl is not spedfied above. If Buyer obtains title insurence, Buyer ~ nil waiving the right to obtain a good and marketable tNle of record from Setter. For the purposes of this Agreement, an'Objadion to Tilia' or'Tftle Objactidn' is same Uile matter whkll tails to pass a title examinaUOn based upon Minnesota law and the Minnesda Title Standards promulgated by [ha Raal Property Section of the Minnesota State Bar Assodation thereby rendering the UUe unmarketable and ie a tide mailer whtdr requires a remedial response try the Sauer prior to or at dosing. An'Exception to Title' orTitle FxcepUon' is someUUe mallarwhtchpassas a title examination based upon Minnesda law and the Minnesda 7fUe Standards; is ganeralty regarded by ifUa examiners as not rendering the title unmarketable and, whitYt, because d its nature, is genereity tlisclosed by title examiners to the recipient of Iha lifts opinion or tide insurance commitment. B. ABSTRACT LOST OR UNAVAMBLE: 71TLE INSURANCE BY SELLER. d Seller is unabta to find the Abstract of Tills or if Seller ditl not roretve ah ADstraet o/ Title when Sallarplndtasad the Property, then, lodamanstrata that Seller's title is insurable for marketability and subject to only those mallets disdosad al Paregreph 6., abdue, within a reasonable Ume after aeeeplanca a( this AgreamanL Sollor shall furnish Buyer with a Commitment far Title tnsurence inckttttng propetseerches covering bankruptcies and stela and federal judgments, federal coon judgment liens in favor d the U.5., liens, and levied and pending spl9dat assessmerns. j5euer. sae Advuorybefow.J The Commitment shall be obtained from (salad one:J The title insurer d Buyers choice; or, The same title insurer that Issued title insurance to Seller so that Seller may obtain a reissue uedit from me insurer. The Commitment shall coraain ma Insurers requirements for daleltng these exceptions in me owner's polity (except far those matters accepted by Buyer in this Agreement): (1) Rights or claims of parties in possess'wn, not shown by the publieretords (2) Easements, or claims of easemanls, not shown by the public recgWs: (3) Disuepandes, coMids in boundary finds, shortage in area, enuoachmenls, and any fads which a conect survey and inspetbon a! rho premises would dsdose and whldt are not shown by the pubic rewrds: and. (4) Any lien, or right to a Nan, for services, labor or matedal tumlahed, imposed bylaw and cwt shown fry rho public roeords. Sallar shah provide to Buyer and to the Utla insurer elldocumeraa (axeept a survey, unless SeOe[is required by other provisions al this Agreement to provide a survey) necessary to enable the title insurarta delete these exeepttona from the avmers pbliry of title insurance. Buyer shell have Ian businessdaysadarrereiptotthoCammilmantforTitlelnsurerltstoprovideSsllarwimaeopyofineCommitmanttmdwritltmTitleODjeeUons. Buyer shall be tleemetl to have waived any Tilts Objections nil made within the ten day pedod above, except that mis shall not operate as a waiver o! Sellers cavanaM to dakver s statutory Warranty Oaed, unless a Warranty Dead is not spedfietl above. By agreeing to receive title insurance in lieu of an Abstract, buyer Is not waiving the right to otain a good and marketable tale of reeard from Seller (Buyer. sae Advisory be~owJ Select ono of tbo toffowing: ® ThaCammiMentsheUbeeccompanfadtry,etSatlefsexpansa,lhatnsureYsagteemsnt(orthesaparataagreamantota Minnesota-licensed abstracter) to provide Buyer with an Abstraetaf Tale at any time in the future. Tha abstred to ha provided shall De al no cost to Buyer for at! abstrecUng through the data of racord'ng of rho inswment of conveyance cantemptaled by Ibis Purchase Agreement. Seiler shall pay ail commitman4 abstractrrlg, examinadon, searches, end Glle inwrance costs, inelud'mg the premium far the owners polity and excluding the premium forme lenders polides. [] The Commament will not include the insurer's or abstracters agreement to provide Buyer witEt an Absbact of TNa at any time at no cost to Boyar. SeUarshallpayalltommilment,abstrading,exammatian,searches,andGUainsurancecosisinctudingtheprem(umsforthaowners and the lenders poky. ADVISORY TO SELLER: You should tonault with yourlawyar about rho eomparetivo testa of paying an abstract company to produea a now Abetted of Title versus paying lho Buyar'a Utlo lnsuranta tests. In many Minnesota tounUes, it Is toss expensive W obtain a now Abstract. ADVISORY 70 BUYER: You ahaultl consult with your lawyer about the rsiadvo madta at reealving an Abstract of Tide varaus rocalving a dtlo Insurente polity. As a fdure collar of the same property, you Ilkolywlll bo asked to give your boyar an AbslraeL If your Sallar does not obtain rho Utlo tnsuranee endorsement for future produetlon of an Abstract, yeu might bo facing s largo oxpanao when you sets. 15. TITLE CORRECTIONS AND R£MEOIES. SeUersheU have a limned time, from receipt of Buyerswtittan TUIe Objections, to make title marketable. Upon receipt of Buyers Tills Objections, Saliershall, wiminlen business days, give Notice to Buyer of SaOers hlendon to make lillamaacetablawimm the UUe~clearing cure period selected in C.(t) or C.{2J below. Liens orenwmbrences far Nquidated amounts whkh can t>e released by payment or esuawfromprocaedsofclosingshallnotdelaymedosing. I,ureofmadefeclsbySallerahailbereasonable.diligenLandjxompt Pendngwlselxion of title, all payments required herein and the dosing Shall be postponed. As an allemative to makingUUe gcod and marketable at record, Seller may, wimel ilia tan day Notice period make a written, dated offer to Boyar to obtain fide insurance tilt Buyer with Insuring provisions acceptable to Buyer (and, if appiicebta, Buyers !antler), as follows: • Sallarmaypraeuro,at9altersexpense,enownerspotitydUtleinsurene9,fromeninsurerregistaredendlicansedlodobuslnessinMinnasota acrd acceptable to Buyer, spadficaliy insuring worths Titre Objectials; or, • IftheTiOeObjectidnsarestetedinalitielnstaantseammitrnedvAt(dtBuyorhasabl8ined,SeNetmayprwidetheinsurervAthsuchtloeumants and escrows as era ne~saary to allow rho insurer to spedneauy inaura war the Title Objections and agree to pay all dt tits insurora charges for issuing the owners poltyy to Buyer. Under oimar of msso title insuring allemr#ives,'d Salvers expense" and'pey all of me insurers thargas' mean mat Seller will pay all ode insurance commilmentand policy premium charges, seardt charges, plat drawing fees, and arty other charge by the insurer to issue ma owners policy, but not rho premium for a lenders policy, H arty. If Boyar accepts Selkars oflerof en inaurabta UUe, men in mis Purchase Agrosment,'matdng title markalabte' shall mean 'making title insurable,' in the meaner desuibad above. Buyer is under no obligation to aeeept Sellers otter of an Insurebte title m Ueu of a good and marketable Utte of record, but, if Boyar does nil reJed Selmrs oBerof en instlreblatitlevrilhin three (3} business days o-reteiving Sellers oHar,BuyershallbadeamedtohaveatceptadSallarsoKerofaninsurebteUUe. UBuyerreJedsSellersoflertomakeGlleinsureble.Sallarshallthen make tiffs good and marketable at record end shall be subject to me provisions d mis agreement tar failure to limety present goad and marketable tills 0} fetafd. A If Notice is given and Salter makes. title marketable, then upon presedatidn to Buyer arttl proposed lender of tlocumentatton establishing that UUehasbeenmademancelable,andifttotobjededtainwraingandwitlim5businesa deysofreeeiptofSelloradoeumentation,medosingshall take place within ten business days ar an ma scheduled dosing date, whkhever is later. B. I(Sallerdoes not give NoUes of intention remake UUe marketable wimin ten business days aftarreeeiptoE Buyers TUa Otrjactions, mis purchase Agreement is canceled and the earnest money shall bo reftxtdad to Buyer. C. SoloeUon of Tiilo~CieaAng Cure Pedod. (C.(1) and C.{YJ era aframaUvo remedies, ONLY ONE OP THEM CAN APPLY FOR 7H1S PURCHRSEAGREEMENT. ifatthorpartycannorenduramorathanaJdto45daydafayforUratloatng,aetetrC.(t). ifbofhpartloscaa onduro a fongerdMay for rho cfos)ng, sofeet C.(YJ. SELECT ONLY C.(tj OR C.(sj.) IF THE PARIIt3 DO NOT SELECT C,(1) OR C.{2), BYCHECKING ONE OFTHE BOXES BELOW, THEN C.(1 } AUTOMATICALLYAPPLIES AS ATERM FOR THIS PURCHASE AGREEM ENT. C.(1) is seceded as a remedy for mis Purdtase Agreement. 1) Seller shat! Nava ~0 days from receipt o/ Buyers written Title Objections or unto the Data d Closng, whichever date Ia Wter, to make GUe marketable. If Notice. is given but me staled paned expires without thle being made marketable, Buyer may. (a) Cancel mis Purchase Agreement by rwtiee to Salter pursuant to Minnesota Statutes Section 559217, Strad. 3 (aUOVring Sallar a 15 day nghl W sae) and neither party shall ba liable for damages hereunder to ma other, and me earnest money shall ne refunded to Buyer, or, (b) Elect to take title subject to some br ail of the Title Objections. C.(2) is selected as a remedy far mis Purchase Agreement. 3$ M.S.B.A. Real Properly Form No.1 {199x; Rev. f996: Rev. 1997; Rev. 2002; Rov. 2004: Rav. 2005; 20D7; 2008) Minnesota Standard ResidenNat Purchase Aareement__ PURCI~f,45E AGREEMENT / PAGE t3 of 10 iGi ws 3GG 357 3G8 iG9 370 371 ir_ 373 473 371 pG in 378 379 iAu 381 463 383 36J 383 4AG 38T 486 389 ova 391 393 397 i'J3 37s a9G 397 478 a77 Sao sin sea 3113 sui sos SaG so7 soA sag slo su 513 SI3 SW s1s s1G sn SI8 519 33U 531 333 sn 7.3 323 sac 527 528 529 330 33t s33 533 573 333 33G 337 338 337 Si11 341 133 333 sit s33 SSG Si7 Sib 33'J S30 331 532 531 353 SSS 33G ss7 338 35'7 3GU (2} Seltar shall have fseled oneJ 60 / 90 ! 120 days from receipt of Buyafs written Title Objections orundl the Date of Closing, whichever date is later, to make t81e markalabte If Ndica Is given but the stated period expires without title being made marketable, Buyer may aeek, as permitted by law, ana or more of rho following: (a) Proceed to dosing without weiveror merger in the Deed of the Title Objections and without waiver of any remedies, and may: (i) Seek damages, coals, and reasonablefawyefs fees from Seller as permitted by law (damages undarlhis subparagraph {i) shall ba limited io the cost of curing Title Objections, and cdnsequential damages are excluded): or (ii) Undertake proceedings to coned the TUIe Objections; (b) Rescission of this Purchase Agreement by notice to Salter, in which case ell gamest money paid shall ba refunded to Buyer, (c) Damages from Seller logelher with vests and reasonable Iawyefs fees, as pennftted by law;. (d} Specific paAomtanca within six months after such right d action arises, including costs and reasonable lawyef s fees, (ej Caneellalion of this Purdtese Agreement pursuant to Minnesota Sfatutas Sedion 559.217, Subd. 3 (allowing Seltera 15 day right to Wfe). 0. It tills is marketable, or is matle marketable as provided herein, and Buyer defaults in any of the agreements herein, Seller may elect either of the folowing options, as pertnated by law: (1) CancellhisPutdtasaAgreementpursuaMtoeithorMinrtesotaSWtutasSedion559.21orSeckdn559.217,Subtl.3,androtainallpayments made hereunder as liquidated damages. JNora: Underlederel/aw, Sellermighr not be able !o legaitycfaim a retain the eemest money underpurGrase agreements where Buyarappfies forbutls unable to secure AH.A orO.V.A. mtMgage llnandng./The parties acknowledge (heir intention Ihat any mole gwen pursuant to this eontreU is a down payment Hole, and may ba presented for payment notwithstanding can~IlatitM; {2) Seek spee~e peAOmiance within six months aftersuch righlof action arises, inducting costs and reasonable lawyefs teas, as permitted by IoW. E. If title is marketable, or is made marketable as provided herein, and Seller defaults in any of the agreamants herein, Buyer may, as permitted by taw (1) Seakdemages from Seltar including costs and reasonable tavryefsfaes; (2) Soak spedfic performance within six months after such light Df aefidn crises, inducting casts and reasonable lawyefs fees; (3) CancalthisPurcheseAgraemenlpursuanttaMinttesotaStatutesSectlon559.217,Subd.3(allawingSellera l5dayrigMtowre)andnoilhar party shall be liable far damages hereunder fa fho other, end the aamost money obeli be refunded to Buyer NOTE: It this Purchase Agreement Is oant:alotl using MinnoaotaStatgtbs Secnon 558,257, contract provisions and ataturory provlalons tgr refunding of the oamast money to Buyer might ho In eon0leL 16. NOTICF~, All rolices required herein shell be in writing end delivered petsartelly or mailed to Ilia address as shown et Paragraph 1 above and, if mailed, are eftedWe es of the data of mailing. 17. SUBDIVISION OF lANO. If this sale eonstitutas or requues a subdivision of land ovmed by Seller, Sellershall pay all subdivision expenses and obtain ellnecessarygovemmentalapprovals. Sellefvrarrantsthatthelegaldesaiplionoftltarealprapartytobeconvayedhasbeenorwdlboapproved far recording as of 1ha Dateof Closing 18. MINNESOTA LAW. This centred shall ba govamad by the laws of Ne Slate at Minnesota 19. WETLANDS, SHORELAND,AND FLOOD PLAIN CONCERNS. Unless disdosed as'amalerial fad•lhat could adversely and signifnanlly affeU buyefs use antl enjoyment of the Property or any intended use of the Property, current law does not require Seller to disclose SaUafs knowledge, if any, oftheaxistenceofwotlands,shoretand,orSoodplafnonoreffedingtharoalproperty. ifBuyerhasnotakeadyinvestigatedthesaconcems,Buyer might want to induda Sellefs disdosuras regarding these concerns. (Check lhebox Nthe /dlowing provision applies to this Aurchase Agreement) ADOENDUMTOPUB:CHASEAGREEMENT: WETLANDS, SHORLLANDANDFI.O6DPLAIN DISCLOSURE, M.S.B.A ReatPropertyForrn No, 8 (1997}, is indutlad as an atldandum to this Purchase Agreement. 2a. SELLER'S AFFIDAVIT. At dosing, Seltar stroll supplement fho wanantias and representations in this Purchase Agreement by axecuUng and deilvaringaMinnasotaUnifonnCOnveyaneingBlenk(FormNo.50.1.2(famrerly116-M}or50.1.3(formary117•Mor116•M)}AifidavilofSeilar. SaUafs Affidavit shall induda Sellefs representation that no eneuml7renees have boon placed on the property since the date of this Purchase Agreement. 21. CLOSING. Closing shall be at the office of Sellefs tavyar, Buyafs title Insurer, or at some other muWelly agreeable IogUon. (Stale other location'f At closing, SeUar and Buyershall disdose (heir Social Security Numbers or Federal Tax Idant~calion Numbers for the purposes or completing stale and federal tax forms. CLOSING COSTS. The Costs of closing, if Hat determined by other provisions of this Agreement, shall ba paid as tollows. A SELLER'S COSTS. Seller shall pay dte following at ebsing: 1. Document preparation costs, refArtling teas, and deed loxes tordocumenls necessary to estabUsh good antl marketabe lhle in Seller 2. Document preparation vests, eer5fiad copy teas, and recording tees to estabWh rho authority of the person aUing on behalf of Seller. 3. Document preparation costs for Sellefs deed or convact•fordaotl, CeAifiwte of Real Estele Value, Sellefs aHidavtt, Nell Disdosure CaA:ficafe (If required}, and any atlter documents necessary to Transfer good and marketable Uric by Sellefs decd ar wntrect-for-decd. 4. Deed tax on Sellefs dead and the Agriarkutal Conservabon dead tax eRlrgetl under Minnesota Stalutea Saclion 40A152, 5. Faas payable to Sellefs lawyer or to a closer ('title dosal") for eatduUing the Gtle•transtar padion of rho ebsing. If SeUar la not providing a Iawyarortitto closer for the ti8a-transfer portion of the closing and it Buyer is obtaining new mortgage Mandng and 11ta dosafs tae ie nd separated into a'title dosing fee' and a'loan dosing fee; then Seller shall pay one half of the closefsfea ar S wttiohaver 0mbunl 19 leas. 6. Antl also the following vests: & BUYER'S COSTS. Buyer shell pay the following at closing: 1. Document preparation costs, recording fees, and mortgage registry faxes for dowments necessary for Buyafs mortgage fxgneing. 2. Document filing tea far a Well Disclosure CBAilrwta, if appUtable. 3. The Agriwitural Conservation dead tax on Buyafs mortgage deed charged under Minnesota Sfatutas Section 4QA.152. 4. Loan closets foe. 5. Rewrding tea for Deed, Centred for Deed, or arbor instrument of conveyance where Buyer is the grantee 6. And also the following costs: 22 ADDITIONAL TERMS. Pnrrhast? is eBMingpy~pBn~pprgv~ 6y the Nnusing and Redeuelgpment Author' Board fin August 16. Y610. n e waive e 3.ti M.S.B.A. Rea( Property FDtTn No. 7 {t994; Rev 1898; Rev, 1997; Rev. 2062; Rev. 2004; Rav. 2005; 2007; 2008) Minnesota Standard Residential Purchase Aoreement PURCHASE AGREEMENT I PAGE 7 of 10 wl sfi: s67 !6a !63 366 sw sfiA 34') 570 sn sr_ 573 sla Ns J7fi sll 316 sr, sao sel JAI sal SBa !AJ JA6 SA7 SBB Jag sml s7t J92 773 J7a 57J !76 J97 396 377 fi66 fiUl 462 467 664 663 46G 667 6115 (Ora(ter consider;ssuesoJassignmentando/ succasslon,fnanleresr.) 2J. ADDENDA. Attached aro tha following addenda which era made a part of Btis Purchase Agreement: (Cheek ontythoselhat are attached] FINANCING (Seled orttyone finandng addendum:] Fnancing Addendum for Convon0onel / Prlvatoly Inaurcd Mortgage, M.S.B.A Real Property Form No. 2 (2008) Flnaneing Addondum for FF(A lasurad Mortgago, M.S.B.A Real Property Farm No. 3 (2008) Financing Addondum for VA Insured Mortgage, M.S.BA Reai Property Form No. 4 (2008) Financing Addendum for Sollor Mortgage, M.S.BA Real PropeAy Form No. 5 (2005) F(naneing Addendum for Contract for Daed, M.S.B.A Real Property Fortn No. 6 {2005) Financing AddondumforAssumption, M.5.8.A Real Property Form No. T (2005) DISCLOSURE AND CONTINGENCY: Addendum to Purohaso Ageoment: Wotlands, Shoreland, and Flood Plain Dlsciosure, M.S.B.A Real Property Form No 8 (1997} Addartdum forContlagent Salo or Purohaso o! OtherHoma(s), M.S.B.A Real Property Form No. 9 (1997) Load Paint Atltlendum for Housing Consimetod Bofors 1978, M.S.B.A Real Property Form No. 11 (1996) Ohictosurc of Sowage Treatment Syslom, M.S.B.A Real Properly Form No. 14 (7998) Condition or Property, M.S.BA Real Property Form No. 16 (2005} Addondum toPurohaaoAgrcamont Survey,Appraisal,DavslopmentEvaluatlon,andArcheologieailHistarlcaiSurvay,M.S.B.A Raal Property Form Na. 17 (2005} Buyor's Homa Inspac0on CoMingancy, M.S.B.A Real Property Form No. 18 (2005) Well Diselosurc Statomant, M.S 8.A Real'Property Form No. 21 (2005) Mathamphotamino Diaciosuro Statement, M.S.B.A Real Property Form No. 22 (2005} TITLE ISSUES: e Addendum to Purohase Agreement: TIllo Issues, M.S.B.A Real Properly Form No. 19 {2005} Addondum to Purohaso Ageemont: Tonants and PaAlea in Posaasa(on, M.5.8.A Reel Property Fohn No. 20 (2005) COMMON INTEREST COMMUNITY: [] Addendum to Purdhaso Agroamont : Common Interest Community, M S.B.A. Real Proporty Farm No. 12 (2004) Olhers• ___ 616 THI5 IS A LEGALLY BINDING CON'T(21tC'f. BEFORE SIGNING. CONSULT A LAWYER. Minnesota taw pacmits Iteansad real ostato fill brokers and safes agents to preparo purehaso agroomonts. No roeommsndatlon sontatlon may bo mado by any real ostato fiIZ broker or sales agent as to the legal suffietoncy, rho legal oeeet, or the tax cone s o/this eoneroeL These aro questions for fits your lawyer. //''-- lagreetosellthepropertytorthapriwandtarmsandcondil'ionssetfonh lagreet thepropertyf the pricyangtermsandcandiuons above. set fort ova. ~ L ~~ /- SELLER: / .(~~~~~~' i~f{? ~tven L~t~..ui~<, (dat1a)~/,~}j///~/ SELLER: BUYER Gtr-. P v [ ~ •^~~rvti~~~-~" ~, $'tfi ~fO {date) S'ut~en . S[x.a~f,. t (dale) ~it( This PurGtase Agrecment was prepared by t~~ J fV t;{ PtiV D ~ ~ d Ir a-vf t~M' AM~r+o ~rt~ (tv (~ 0 F~2 i H~ C4'~( aF ~Ctt~tr=L.D ~ b'l~ PDKTL.t"cN ~} P(vE. S, / Q-t[F~Ft~~-0t MN 55(23 24. TIME IS OF THE ESSENCE. Time is of the essence for ell provisions of this Purohase Agreemenl. 25. MULTIPLE ORIGINALS. Seller erW Buyer have signed (rtumberj originals of this Purchase Agreement. 3 ~'~ M.S.B.A. Real Property Form No. 1 (1994; Rev. 1996; Rev. 1997; Rev. 2002; Rav. 2004: Rav. 2005; 2007; 2009) Minnesota Standard Residential Purchase Agreement PuRCHasE AGREEMENT t PAGE 8 of 10 tJlhers whe w111 ass&t Sallar er Beonr whh thls }ransncf/nn~ Lawyarlar R3uYE fZ Tataphona: bld-337- 9211 Facsimile: Ip)o~ `3~i -k3it.7 K~Grier+C : ~"jra,rer~ ~ {i,.had-1~~~ lt..orrrn.t 1~•CE n~.. ~tA~S - PKVt~ ~ra~ ~4Y1 Yt L? { ~ ~i S r ~~ ~ "7 J 'iU ~" Lisling Agent and Broker for this trensaction are: Telephone: Faccimila• Selkrtg Agent artd Baker tarthis transaction are: Telephone: Faeslm ite: Buyer's ar LendeYS Ti71e Insurer. Telephone: Facsimde• 3,~~ M.S.B.A. Real Property Form No.1 (tss4 Rev. 1996; Rev, t997; Rev. 2002; Rev. 2004: Rav. 2005; 2007; 200a1 MinnesoEa Standard Residential Purchase Agreement PURCHASE ACaREEMENT /PAGE 9 of 10 PERSONAL PROPERTY AGREEMENT ThlsPersonalPropertyAgreementisasupplementlothePUreheseAgreemeMtowhititAisetWChed. Seller'sabfigetiontotransfertitlatolheparsonal property is contingent upon a successful dosing and transfer of gte real propeny Gge t0 Buyer according to the terms of the foregoing purchase Agreement. A. PERSONAL PROPERTY FNCLUDED IN THE SALE PRfCE OF THE REAL PROPERTY. These items of personal preparty are indutled in the price shown for the real property in the foregoing Purchase Agreement ~ ! ~,Y~. to u 12 u t3 is lG 17 le 19 2e 2l 27 2a a 2G 27 28 _'q 3U St 3? 33 3a 73 SG J7 Ss Sv ao 31 as a3 sa 33 3G 37 sa 39 sn sl 32 ss 33 33 3G 37 38 39 Ge GI G: G3 jSelect only one ollhe fottotvrngl Buyer will accept the propeny'asls' in its condition at the time of dosing. Seller warrants that these items of personal property wig be in wadtirtg order on the day of dosing. For the purposes of this Personal Property Agreement,'inworking order means That the item functions for the purpose than it is intended tc perform, that if is not in violation of any public codes or regulations (although ft may ba lagalty nonconforming under current law), that it does net presently need raplaeemenl, cleaning, repairs art service, that it {snot missing any essential parts, end that its only imperfections are'cosmetid w signs of'waer and tear associated with a product of its age. Setters warranties and representations contained in tlris Personal Property Agreement shall survive lha delivery of the Daed or Contract for Deed end any Bili of Sete for the personal property. Arty notice of a dated or darn of ttreach of waranty es to 'in working order must be in writing and must be given by Buyer to Segerwithin 30 days of the Date of Possession art ha deematl waived Title to personal property passes to coyer by a bill otsale. Upon delivery of the Geed, Selterahag deUvar a Bill of Sala coMeining waranties of title for the above personal property. Seller shalt use M.S. BA. Real Properly Form No. 90 (2005), Yyarranly Bill of Sala or a similar farm containing the foibwing watranges of UUs: 'Setlarwarrants that: Seller is the owner of the personal property described above; the personal property is free from all liens, daims and encumbrances (except as listed above); and that Sager has the dghl b sell and transfer title to and possession of the personal property to Buyer. Seger warrants and shell defend 8uyefs Utle to Ute personal property against arryr and all parsons who dorm any interest through Seller's interest in the personal property descnbod above, SubJaU only to the liens, claims and antaartbrenees listed above.' These wartanties era not intended to dtenga art limi! the waranliea of Minnesota Statutes Section 336.2312 or to after the remadtas avagehle to Buyer under Minnesota Statutes Sections 325E 68 -.7D. At dosxtg or poor to dosing, Seller shall provrda for payment of, salisfadton ef, of release of arty exislinp liens, claims, Or enrambrences on rho personal propeny, except for ins followflg encumbrenea9 which Buyer atxopls er as9ume6 jrisf hemJ: xU This supplement page Is initialed contemporaneously with the signing of the Purchase Ag~reyeAm~ent INITIALS: Sellers Buyers~~' _G.._ B. PERSONAL PROPERTY PURCHASED SEPARATELY. The following trams of personal property owned by Sellerand amently bested on the real property shall be purchased by Buyer at the pnca shown Tor each item. These items are not inclutlad in the price shown far the real property in the foregoing Purchase Agreement and ahatl ba paidfarat dos~tg. 3.,a M.S.B.A. Real Property Form No. 18 (2005) Addendum to Purchase Agreement Buvet's Hame Insoection Cantingency ADDENDUM TO PURCHASE AGREEMENT: BUYER'S HOME INSPECTION CONTINGENCY. ©copydght pegs, 2005 by Minnesota State Bar Assoaalion, Minneapolis, Minnesota. (Use with "Minnesota Standard Residential Purchase Agreement," M.S.B.A., Real Property Form No. 1 (2005).] BEFORE YOU USE OR SIGN THIS FORM, YOU SHOULD CONSULTwITH A IAVJYERTO DETERMINE THATTHIS CONTRACTADEQUATELY PROTECTS YOUR LEGAL RIGHTS. Minnesota Slate Bar AssodaGon disdains any 1{ahipty adsing out of use of this form. A This Addendum is a continuation of the Purchase Agreement dated t"sut_ ~~ ~1, 1,A) v by and between tt r/ tulG 40 ~ ~ I T ~~.~~ s Sellers, and , ~,r 1~~ t; ~°9„~~Its'Lo?r+~~r~T A~xr~sat,ik tK ~o , as Buyers, or property s located at or described as: s c e Deflnittons. For the purposes of th(s Addendum, the following terms have these definitions: ~F 9 "Inspector" means a person currently licensed by thestate of Minnesota as a building inspector, structural engineer, to architect, argeneral contractor orcurrentty employed as an inspector by a home inspection company that is a member u of either National Association of Home Inspectors (NAN1Uj ar American Society of Home inspectors (ASHI~81}. zz "Inspection" means an examination performed by an tnspectar ofthe real property and its improvements. Inspection tr does not inGude examination of personal property. to "Inspection Report' means a written report prepared by an Inspector disclosing the conditions of the real property is and its improvements. is "Public law, code, or regulation" includes, but is not limited te, the Minnesota State Building Coda and those parts 17 of the Uniform Building Code, the Uniform Fire Code, and the Uniform Life Safety Code adopted by reference into the is Minnesota State Building Cade. to "Unsatisfactory Condition" means: (1} thatthe item or component being Inspected is not fit for its intended purpose, zo that it is in violation of a public law, code ar regulation, that it needs replacement, cleaning, repairs or service, or that n it Is missing essential parts; or, (2} That an environmental condition (such as radon, mold, well water contamination, __ asbestos, soil contamination, noise or vibration) exists at levels that are unacceptable to Buyer. However, an item a or component is not in Unsatisfactory Condition if its only imperfections are cosmetic or signs of wear and tear or za diminished effactivaness associated with an item or component of ifs age, or because it is not new or perfect, or zs because it is legally nonconforming under current law. :G z~ Buyer's obligation to close this trensactlon is contingent upon Buyer receiving an Inspection Report from zs Buyer's Inspector disclosing no Unsatisfactory Cond(ttons. The Inspector shall be chosen at Buyer's discretion z9 and at Buyer's expense. 3e Buyer shall obtain the Inspaction_on ar before (state Inspection Dead/tne Dataj l ~ AC [~ c. z aj. z~e r it Buyer shalt have until (select one of these for the Nottftcation Pertodj n ~z three (3) days after the Inspection Deadline Date ~s _ days (not Less than 4 days] after the Inspection Deadline Date as to note Seller in writing of any Unsatisfactory Conditions disclosed by the Inspection Report and to notif)r Seller that ~s the Purchase Agreement is terminated (if Buyer elects to terminate). If Buyer either. s~ (1) does not obtain an Inspection by the Inspection Deadline Date; or, sr (2) does not inform Seiler of such Unsatisfactory Conditions and does not give Seller notice of termination during se the Notification Period; a~ Chen this contingency shall be deemed waived by Buyer. ao ~t If Buyer informs Seller of any Unsatisfadory Conditions disclosed by the Inspection Repot, Buyer may terminate the .~z Purchase Agreement bywritten notice to Seller, delivered to Seller {or posttnariced by U.S. MaN} not later than the and a~ of the Notification Period. If the Purchase Agreement is terminated, then the earnest money shalt be refunded to as Buyer and, jCheck the additional remedies Pram a., and tr., tf either or both apply to this agreementy as ~ a. Seller shall reimburse Buyer for % Of the fees paid to the Inspector and Buyer shall deliver a~ a copy of the Inspection Report to Seller. a~ Q b. Seiler shall reimburse Buyer up to a maximum of $ for all of Buyer's costs paid and ar expenses incurred to apply for a mortgage loan for the Property. a~ so Fotlowing the Buyer's receipt ofan Inspection Report disclosing any Unsatisfactory Condition and before the st and of the Notification Period, the parties may negotiate an additional written agreement for the repair, sz replacement, or remediation of any Unsatisfactory Condition or for the reduction of the purchase price. ANY s3 SUCH NEGOTIATIONS MUST BE COMPLETED BEFORE 7HE AND OF THE NOTIFICATION PERIOD. SUCH s.l NEGOTIATIONS DO NOT EXTEND THE NOTIFICATION PERIOD. Ss sa Buysr shalt have reasonable access to the property to inspect it with or without an Inspector. If Buyer has it Inspected s~ by a person who is not qualified as an Inspector, such inspections are insufficient for the purposes of this Addendum, s8 s9 The terms rsf this Addendum do not change any obligation for Seller to provide disclosure created by statute, co ordinance, or common law. The terms of this Addendum do not a e Setter's obligations, if any, to remedy ~r arty conditions disclosed by inspections by F.H.A, or D.V.A. or p v e lenders. The to of this ~z Addendum do not change Seller's obligations to reined one sclosed by untcip ausing ra inspections and required to be repaired, replaced or othertvlse co tad y municipal h~using od s. SELLER: SELLER: BUYER: ~u Buyer's source of funds for the purchase of L, h, t:Y~GU.~.tG B.rt v.,5a-.~o-akt~ ~Hc.~rQzrsw, Property require[]that the Property Buyer's inspection discloses that be "structurally substandard" as defined by state law. if the the dwelling structure on the Property: (1) has no building code deficiencies; or (2) has building 3.13 M.S,B.A. Real Property Form Na.18 (2005) Addendum to Purchase Aoreement euver's Hom Insoectfon Gonfinaencv SUPPLEMENTAL PAGE code deficiencies, but the cost to satisfy the Minnesota state buidling. code is less than 15 percent of the cost of constructing a new structure of the .same square footage and type on the site; then•Buyer shall have the right to cancel this Purchase Agreement pursuant to this inspection .contingency addendum. 3.i~ 1 7 a 5 6 7 s 9 ro n L 13 W IS 16 I7 IS 19 30 21 Z? ?~ 2a :5 :6 :7 ?8 ?9 30 3t 3: 33 74 3s 36 37 38 39 4D 41 43 43 44 as 46 a7 4s 49 50 51 5? 53 54 55 56 57 ss 59 60 61 6? 63 64 65 66 67 68 69 70 71 73 73 M.S.6.A. Adel Property farm No. U {19Sie; 2008) Lead Pafnl Addendum ter Heusine Censtn,afad aalam_1979 _ Paey_ipj,~, LEAD PAINT ADDENDUM FOR HOUSING CONSTRUCTED BEFORE 1978 ©Capyright 2009 MlnnesoW SWW BatAssorJa9on, Mbineapoiis, MinnasaW. (IrtO anyvri9r'Minmsata aWndafd Rosidentisl Purchase Agreement,' Minnesota SWto aarAsaoaa6on 2009.) ~ pp 'this addendum is a continuation of the Purchase Agreement dated P~ oast- ~ ZR') i hS by and between 8 trt ttotiAir w tlNS S>r 2 ~ i c, t rs ~ i ~ ~- as Sellers, and r191.cs ~ R 'N s" ~ 1 te~asBuyers, far property touted at or described as -l ~ 3't o sA Pa (r; _fh/~. S.. Q ~ r. rrF, 'c ~fl. M t ~~u z3 ~S.u E'r >v'fY LEAD WARNING STATEMENT Every purchaser of any Interest in residential rest propeRy on wtrtch a reslderttia! dweping was 6u11t prior to 1978 is notitred /hat such property may present exposure to teed from toad-based paint that may place young chFldren of risk of developing lead poisoning. Lead poisoning in young children mayproduce permanent neumlagical damage, including feaming disabiNttes, reducetl irttelAgenCe quotienk behavioral problems, andimpalred memory. Lead poisoning also poses a parlicularrisk to pregnant women. The seller of any interest in resfdentiat real properlyls required to provide the buyer with arty lrttarmafion on teal-based paint hazards Irom risk assessments or inspections trt fhe seNers possession and nohry the buyer of any known teadbasad patnt hazards. A dale assessment orinspection forpossible lead-based paint hazards is recammertded prior to purchase. LEAD PAINT INSPECTION CONTING@NCY Buyer shall have 1g days from the signing at this Agreement to conduct a risk assessment or inspedion for the presence of lead- based paint and lead-based paint hazards and to give seller the inspedion or risk assessment report and a list of repairs required by buyer to correct problems sat cut in fhe report (Intact lead-based petnt that is in good cantlition is not necessadly s hazard. See EPA pamphlet Prated Your Family From Lead In Your Mome formate information.) It the report disdases problems seller shall have seven {7) days aHer receipt of the report and Ifst to elect in writing whether to correct the problems prior to closing. If seller clads to make the corredions, seller shall provide buyer prior to Dosing with eeNfieation from a risk assessor orinspection demonstrating that the problems have been corrected. If seller does not elect to make the corrections, buyer shall have three (3) days to elect to take fhe property in its'as is' contlttlon as to problems set out in the report, or this purchase agreement is void. Buyer may waive in writing the rights contained in this contingency at any time. Seller's Disclosure (a) Presence of lead-based paint orlead-based palm hazards (check (i} ar (ii) below}: (i) 0 lead•based paint orlead-basetl paint hazards are present in the housing (explain:) (ii) ~ Seller hes no knowledge of lead-based paint orlead-based paint hazards in the housing. (b) Records and reports available to seller (check () or (ii) bebw): (i) 0 Seiler has provided buyerwith all records and reports in seller's possession or reasonably obtainable by seler pertaining to lead-based paint and lead-based paini hazards in the housing (list documents below). (7) ~ Seller has no reports or records pertaining to lead-based paint or lead-basetl paint hazards in the housing. Buyer's Acknowledgment (inidaq (c) .,," ,,,_, Buyer has received copies of all infarmaton F(sted at (b)(i} above. (d) _,_,,,, _,--_ Buyer has received the pamphlet, Prated Your Family from Lead in YoufyQme, an EPA publication available at www.eca.aov/iead/oubslteadodfe.odf, (e) ~ _ Buyer has (check (i) or (ii) below): (i) „+ -, _ received a 1 Q-day opportunity (or mutually agreed upon period) to conduct a risk assessment or inspedion farthe presence of lead-based paint and lead-based paint hazards; or, (ii) _ _ waives the opportunity to wnduet a risk assessment or inspection for the presence of lead- based paint and lead based paint hazards. Agent's Acknowledgment (initiaq (f) ~ Agent has intonnetl seller of seller's obligations under 42 ~.CrC. ~ 2d and is aware of agent's responsihilily to ensure compliance, ( j Certification of Accuracy The following parties have reviewed the information above and provided is ttua and accurate, ~ Seller date Listing broker/ agent data s have 1ev~r t_- vicv}r t.K.i~v~tiJ,rt ,data Owvcs~, d "! - uZknnY M- ~~tit 1 Cttalt(}~rssn date ~~~~~)~ t Selling broker! agent date ~~' _ ~/_~ 7537 Dupont Avenue ~~ ~ . : ~ . ~~ : _ ~ ~ ~~.~ t ~~ ~ _ y~y.4 ~«R t} _ F " Ste aµ ~ . ~ °' a. R ~ ~ ~~+q"~ Y t , ~~ ' ; 2t :~ ~ r. tea.. ; > e^~~ ~ ~ _ ~ a z .u .1 s '~" ~:. f 4 t^ ~ 1 .....,..x. ~.._ 4hb' y~ .~ .n .. ,t Ji ~~ ,., ~$sv' "~ L». ',. ..fir. ~.. ~ <. .'+~' ,a.... ~ti tN u e' AGENDA ITEM # 4 REPORT # 2 ~ ~- STAFF REPORT HOUSING AND REDEVELOPMENT AUTHORITY MEETING AUGUST 16, 2010 REPORT PREPARED BY: REPORT PRESENTER: DEPARTMENT DIRECTOR REVIEW: REVIEWED BY EXECUTIVE DIRECTOR: JULIE URBAN, HOUSING SPECIALIST NAME, TITLE JOHN STARK, COMMUNITY DEVELOPMENT DIRECTOR (~ NAME, TITLE ITEM FOR HRA CONSIDERATION: Consideration of a contract with S.R. Stevens Excavating, Inc. for demolition at 7326 Sheridan Avenue, 6336 15th Avenue, 6609 Humboldt Avenue, and 6637 5th Avenue and authorize staff to contract for any uncovered abatement costs. I. RECOMMENDED ACTION: By Motion: 1) Approve the attached Contract for Demolition with S.R. Stevens Excavating for demolition at 7326 Sheridan Avenue, 6609 Humboldt Avenue, 6336 15th Avenue, and 6637 5th Avenue; and 21 Authorize staff to contract for anv uncovered abatement costs. II. BACKGROUND In 2010 the Housing and Redevelopment Authority (HRA) acquired properties at 7326 Sheridan Avenue, 6609 Humboldt Avenue, 6336 15th Avenue, and 6637 5th Avenue. The HRA plans to demolish the existing substandard structures and make the lots at 7326 Sheridan and 6609 Humboldt available for new home construction through the Richfield Rediscovered Program and develop new affordable homes on the lots at 6336 15th Avenue and 6637 5th Avenue through the New Home program. 08162010 Demo RR and New home houses.doc HRA staff solicited bids for demolition of the houses and garages from five companies: S.R. Stevens Excavating; Frattalone Companies; VEIT & Company; Demo, Dig & Haul, Inc.; .and Doboszenski & Sons. Three companies responded to the request, submitting the following estimates: • S.R. Stevens $26,200 • Frattalone $39,500 • VEIT $50,713 While funds for demolition are not available in the current 2010 Budget, funds have been allocated in the proposed Revised Budget for 2010. Although the demolition could be postponed until after the revised budget is approved, removing the blighted properties now will reduce holding costs, deter vandalism, improve neighborhoods, and allow for seeding of the cleared lots before winter. Staff recommends that the HRA approve a contract with S.R. Stevens Excavating for the demolition work to be completed by October 15, 2010. As part of the contract, S.R. Stevens will survey both properties for asbestos and other hazardous materials. The cost for removal is not covered by the contract but will be subcontracted for, if necessary. III. BASIS OF RECOMMENDATION A. POLICY • The HRA has demonstrated success through its Richfield Rediscovered and New Home Programs in removing obsolete housing in poor condition and developing new housing that meets the needs. of today's households. • Historically,. the HRA has demolished the existing home prior to selling the_property. B. CRITICAL TIMING ISSUES • The houses are currently vacant. To reduce potential risks, holding costs, and negative impacts to the surrounding neighborhood, the houses should be demolished as soon as possible. • If the contract is approved, demolition will be completed by October 15, 2010. C. FINANCIAL • S.R. Stevens Excavating submitted the lowest bid at $26,200. • Any abatement costs will be considered above and beyond the demolition costs. • There are funds available for the demolition and any necessary abatement in the revised 2010 budget. D. LEGAL • Legal counsel drafted the Contract for Demolition. ALTERNATIVE RECOMMENDATION(S~ • Do not approve the Contract for Demolition. • Award contract to another bidder. ~ V. ATTACHMENTS ~ molition. I V 1. PRINCIPAL PARTIES EXPECTED AT MEETING I ~,i CONTRACT FOR DEMOLITION OF 7326 Sheridan Avenue South 6609 Humboldt Avenue South 6336 15th Avenue South 6637 5th Avenue South THIS CONTRACT is made and entered into this day' of , 20_, by and between (the "Contractor") and the Housing and Redevelopment Authority in and for the City of Richfield, State of Minnesota (the "HRA") (collectively, the "Parties"), for the .demolition of buildings and abatement of hazardous substances and materials of the property located at 7326 Sheridan Avenue South, 6609 Humboldt Avenue South; 6636 15th Avenue South, and 6637 5th Avenue South, Richfield, MN 55423. RECITALS WHEREAS, the HRA requires the demolition of buildings at 7326 Sheridan Avenue South, 6609 Humboldt Avenue South, 6636 15th Avenue South, and 6637 5th Avenue South including among other items, the abatement of hazardous substances and materials (the "Work"). WHEREAS, the HRA has awarded the Work to the Contractor; WHEREAS, the Contractor represents that it has the necessary personnel, experience, competence, and legal right to perform the Work; . NOW, THEREFORE, in consideration of the mutual obligations of the Parties hereto, each of them does, hereby covenant and agree as follows: Section 1. Definitions "Asbestos" means any material containing more than one percent asbestos, which is friable, releasing asbestos fibers into the air, above current levels established by the United States Occupational Safety and Health Administration. "Contract" or "Agreement" means this agreement between the HRA and Contractor for the performance of the Work, together with all exhibits, amendments, or modif cations to the Contract. "Destructive Report" means a hazardous materials abatement inventory prepared to assist in establishing the scope of the Work. "Final Completion" means all items of the Work, "punch list items" and site work are completed and Contractor is eligible for Final Payment. 314396v2 MTN RC125-1 l ~a "Hazardous Materials" means asbestos, PCBs, petroleum hazardous waste, radioactive material, or any other hazardous materials or hazardous wastes within the meaning of City, State of Minnesota, or Federal definitions of hazardous materials or hazardous waste. "Owner" means the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota. "Property" means 7326 Sheridan Avenue South, 6609 Humboldt Avenue South, 6636 15th Avenue South, and 6637 5th Avenue South, Richfield, MN 55423. "Substantial Completion" means the time at which the HRA determines that the Work has progressed to a point where it is sufficiently complete, leaving only minor "punch list" and close out items and other minor site work required to be completed for full payment of the contract price. "Work" means the entire completed demolition, abatement of hazardous materials, and all other activities to be performed by Contractor on the Property as provided for in the Contract. Section 2. General Requirements 2.1. Rights of the HRA. The HRA and the City reserve the right to reject any or all proposals or parts of proposals, to accept part or all of proposals on the basis of considerations other than lowest cost, and to create a project of lesser or greater expense and reimbursement than described in this Contract. The HRA also reserves the right to cancel the Contract without penalty, if circumstances arise which prevent the HRA from completing the project. In the event of any conflict between the General Conditions and this Contract, this Contract shall control. 2.2. Interest of Members of City or HRA. The Contractor agrees that no member of the governing body, officer, employee, or agent of the City or the HRA shall have any interest, financial or otherwise, direct or indirect, in the Contract. 2.3. Equal Op ortunity Statement. Contractor agrees to comply with the provisions of all applicable federal, state, and City of Richfield statutes, ordinances, and regulations pertaining to civil rights and nondiscrimination including without limitation Minnesota Statutes, Section 181.59 as amended, incorporated herein by reference. 2.4. Transfer of Interest. The Contractor shall not assign any interest in the Contract, and shall not transfer any interest in the same either by assignment or novation, without the prior written approval of the HRA, provided, however, that claims for money due or to income due to the Contractor may be assigned to a bank, trust company, or other financial institution, or to a Trustee in Bankruptcy without such approval. Notice of any such assignment or transfer shall be furnished to the HRA. Notwithstanding. the foregoing, Contractor shall be entitled to use subcontractors to perform the Work. 314396v2 MTN RC125-1 2 3 2.5. Independent Contractor. Nothing contained in this agreement is intended to, or shall be construed in any manner, as creating or establishing the relationship of employer/employee between the parties. The Contractor shall at all times remain an independent contractor with respect to the services to be performed under this agreement. The HRA shall be exempt from payment of all Unemployment Compensation, FICA, retirement, life and/or medical insurance and Workers Compensation Insurance as the Contractor is an independent contractor. 2.6. Hold Harmless. The Contractor agrees to defend, indemnify and hold harmless the HRA and the City ,its officers and employees, from any liabilities, claims, .damages, costs, judgments, and expenses, including attorney's fees, resulting directly or indirectly from an act or omission of the contractor, its employees, its agents, or employees of subcontractors, in the performance of the services provided by this contract or by reason of the failure of the contractor to fully perform, in any respect, all of its obligations under this Contract. 2.7. Accounting Standards. The Contractor agrees to maintain the necessary source documentation and enforce sufficient internal controls as dictated by normally accepted accounting practices to properly account for expenses incurred under this contract. 2.8. Retention of Records. The Contractor shall retain all records .pertinent to expenditures incurred under this Contract for a period of three years after the resolution of all audit findings. Records for non-expendable property acquired with funds under this contract shall be retained for three years after final disposition of such property. 2.9. Disclosure. The Contractor agrees to comply with the Minnesota Government Data Practices Act, Minnesota Statutes, Chapter 13, and all other applicable state and federal laws relating to data privacy or confidentiality, as those laws may be amended. The Contractor shall immediately report to the HRA any requests from third parties for information relating to this agreement. All data created, collected, received, stored, used, maintained, or disseminated by the Contractor in performing its obligations is subject to the requirements of the Act, and the Contractor must comply with those requirements as if it were a government entity. The HRA agrees to promptly respond to inquiries from the Contractor concerning data requests. The Contractor agrees to hold the City and the HRA, its officers, department heads and employees harmless from any claims resulting from the Contractor's failure to disclose data maintained by the Contractor and authorized. for release by the HRA, and from Contractor's unlawful disclosure. or use of data protected under state and federal laws. Section 3. Contract Price 3.1. Upon compliance with all the requirements of this Contract, Contractor shall be paid the Contract Price of $ ,pursuant to Section 28 of this Contract. Section 4. Project Schedule 314396v2 MTN RC125-1 ~.~ 4:1. Contractor shall commence the Work on or after contract execution and Substantial Completion of the Work shall be achieved no later than October 15, 2010. Section 5. Local Permit Requirements and Related Submittals 5.1. Contractor shall obtain permits required by the City of Richfield, including a plumbing permit (for water & sanitary sewer disconnects) and a demolition permit. Questions about these permits, permit fees, and the scheduling process for the required inspections should be directed to the Building Inspections Department at Richfield City Hall (612-861-9816). Contractor has not been provided a copy of a Destructive Report. The Contractor is responsible for obtaining a Destructive Report. A copy of the Destructive Report shall be provided to the City. Upon review of the Destructive Report, the City may authorize the Contractor to remove any required materials or subcontract separately for the removal work. The Destructive Report is not intended by the HRA to limit the activities of the Contractor, but to assist the Contractor in assessing the scope of the Work for purposes of complying with its obligations under this Agreement. 5.2. No less than 2 days prior to beginning the Work, the Contractor shall provide: - Description of proposed dust and noise control measures for the Property. 5.3. Upon completion of the Work, Contractor shall provide: - Copies of any permits required by government agencies other than the City of Richfield, such as transport or disposal permits. - Copies of any test results required by government agencies other than the City of Richfield, including but not limited to testing required as part of the asbestos abatement process. - Copies of all landfill records indicating receipt and acceptance of hazardous wastes by a landfill licensed to accept hazardous wastes. Section 6. Job Conditions -General 6.1. Contractor will disconnect and abandon utilities serving the Property, including water, sanitary sewer, electricity, gas and telecommunications; or arrange for disconnection and abandonment of same. Contractor shall not begin work before field- verifying that disconnection and abandonment has been completed. 6.2. Owner shall ensure that the buildings will be vacated and use of the property will be discontinued prior to start of work. 6.3. Owner assumes no responsibility for actual condition of structures to be demolished. Conditions existing at time of inspection for bidding purposes will be 314396v2 MTN RC125-1 4 ,~,5 maintained by Owner to the extent practicable. Contractor may salvage any and all materials and equipment from the Property. Variations within structures may occur due to removal and salvage operations prior to the start of demolition work. 6.4. This is a lump sum contract. Contractor must immediately contact Owner prior to exceeding the Contract Price set out in Section 3.1. Change orders for additional payment will not be granted due to the Contractor underestimating quantities of material(s). 6.5. Contractor shall provide all labor, materials, equipment, employee training, compliance with all regulations, permits, notifications, licenses and agreement necessary to perform the work described in this Contract. 6.6. All materials from undertaking the Work shall become the property and responsibility of the Contractor. 6.7. Contractor may choose to salvage materials and equipment. Any salvaged items must be removed from the Property in a timely manner as they are salvaged. On site storage or sale of salvaged items is prohibited. 6.8. The use of explosives and on site burning by the Contractor are prohibited. 6.9. Contractor shall provide water, electricity, communications and toilet facilities on site as necessary to complete the work. 6.10. Contractor shall provide and maintain uninterrupted vehicular access to the Property, including temporary demolition facilities, storage and work areas, for not only persons and equipment involved in the project but also emergency vehicles. 6.11. .Contractor shall keep fire hydrants and water control valves free from obstruction .and accessible for use. 6.12. Contractor shall take all necessary safeguards to prevent damage or injury to neighboring property. 6.13. Prior to closing or rerouting existing traffic lanes or sidewalks in any public street easement or right-of--way adjacent to streets, the Contractor shall obtain written permission from the City Engineer. Expenses related to lane closures, including but not limited to traffic barriers, signs and similar equipment as well as traffic control personnel, shall be the responsibility of the Contractor. Section 7. Asbestos Abatement 7:1. Contractor -shall remove and- properly dispose of all friable and category 2 non- friable asbestos containing materials and complete asbestos abatement on the Property in 314396x2 MTN RC125-1 5 t~,lo accordance with Minnesota Pollution Control Agency regulations and the Destructive Report identified in Section 5.1 of this Contract. 7.2. Contractor shall decontaminate and encapsulate the work area prior to final clearance and air monitoring. 7.3. Contractor shall provide final cleanup and removal of all remaining temporary barriers, equipment and supplies. 7.4. Contractor shall provide all monitoring and analysis of air samples as required by state and federal regulations. 7.5. Contractor shall complete final clearance and air monitoring as required by state and federal regulations. Section 8. Other Hazardous Materials Abatement Pursuant to Minnesota Pollution Control Agency regulations (and the Destructive Report), Contractor shall remove and properly dispose of the following materials and items from the Property: 8.1. Mercury: a. Batteries: Smoke detectors, emergency lighting, exit signs, security systems and alarms. b. Lighting: Fluorescent lights and bulbs; high intensity discharge lights (metal halide, high pressure sodium, mercury vapor and neon); switches and controls for lighting. c. Heating, Ventilating and Air Conditioning Systems: controls, devices, thermostats, aquastats, pressurestats, firestats, manometers, thermometers. d. Boilers, Furnaces, Heaters and Tanks: Mercury flame sensors by pilot - lights; manometers, thermometers, gauges, pressure-trol, float and level controls, space heater and unit ventilator controls. e. Electrical systems: Load meters and supply relays, phase splitters, microwave relays and mercury displacement relays. f. Miscellaneous: All vacuum, pressure, fluid level, temperature and flow rate control boxes and panels. g. Any- electrical wiring. from- fixtures or equipment being removed for abatement shall be capped. 314396v2 MTN RC125-1 6 ~1 8.2. Poly-Chlorinated Biphenyls (PCBs): Transformers, transistors, capacitors, heat transfer equipment, light ballasts. 8.3. Chlorofluorocarbons (CFCs) and Hydrochlorofluorocarbons (HCFCs): Fire extinguishers, air conditioners, walk-in coolers and freezers, water fountains and dehumidifiers, refrigerators/freezers/chillers, and heat pumps. 8.4. Miscellaneous: a. Hazardous waste including general-purpose cleaners, paints and thinners. b. Oils including used oil and hydraulic oil in door closers. c. Water heaters. d. Space heaters. e. Air compressors and controls. f. Building unit ventilators. g. Radiators. h. Fuse boxes and electrical panels. i. Roof top exhaust vents with motors. j. Boiler chemicals. k. Heating fuel tank, including contents, if any. Section 9. Demolition 9.1 Owner has not conducted any testing to determine the extent of lead based paint. Contractor shall conduct demolition in compliance with any state or federal regulations governing demolition of structures containing lead based paint. 9.2. Contractor .shall use water sprinkling, temporary enclosures and other suitable methods to Limit dust and dirt rising and scattering in air. Contractor shall comply with any and all governing regulations pertaining to environmental protection. Contractor shall not use water when it may create hazardous or objectionable conditions such as flooding or pollution. 9.3. Contractor shall clean adjacent structures and improvements of dust, dirt and debris caused by demolition operations and return adjacent areas to condition existing prior to start of work. 9.4. Contractor shall demolish buildings, other structures, improvements, and landscaping completely and remove all debris from the Property. Contractor may use such methods as required to complete the work subject to the limitations of governing regulations. 9.5. Contractor -shall proceed with demolition in a systematic manner, from top of -- structures- to ground; and will complete demolition-work above each- floor or -tier before disturbing supports on lower levels. 314396v2 MTN RC125-1 7 ~~ 9.6. Contractor shall locate demolition equipment throughout the building and remove materials so as to not impose excessive loads to supporting walls, floor or framing. 9.7. Contractor shall provide and maintain interior and exterior shoring, bracing or other structural support to preserve structural stability and prevent movement, settlement or collapse of the building. 9.8. Contractor shall break up any concrete slabs-on-grade and remove from the Property. 9.9. Contractor shall demolish footings, foundation walls, tunnels and other below- grade structures and remove from the Property. 9.10 Contractor shall provide certificate of well abandonment if required. Section 10. Debris Control 10.1. Contractor shall maintain the Property free of extraneous debris. 10.2. Contractor shall prohibit overloading of trucks to prevent spillage on access and haul routes. 10.3. Contractor shall maintain a sweeping and clean-up program to prevent deposition, release and disbursal of soils and debris onto paved surfaces. Section 11. Disposal 11.1.. Contractor shall move from the Property all debris, rubbish and other materials resulting from demolition operations. 11.2. Contractor shall transport materials from the Property and legally dispose of them off-site in accordance with governing regulations. Section 12. Earthwork 12.1. Contractor shall rough grade the Property using clean fill after completing all abatement and demolition activities; taper edges of all excavated areas to minimize slope of 2 to 1, keeping soil disturbance to a minimum. Section 13. Excusable Delays 13.1. The following circumstances, and o~ these circumstances, will, at the HRA's discretion, be considered legitimate cause for a change in the commencement and/or - - completion dates specified in-Section 4-of thin Agreement: 314396x2 MTN RC125-1 8 ~~ a. Material delay -- material delays that are beyond the control of the Contractor, which can. be shown to have directly caused the overall late completion. b. Adverse weather and emergency conditions -- weather or emergency conditions that directly affect the scheduling of exterior work over a significant portion of the term of this Agreement. c. Strikes -- Contractors who face union work stoppage in the case where they have to rely on such a work force in order to complete the Work. d. Amendments -- amendments in the original scope of work, which can be reasonably shown to require an extension of the time allowed for completion. e. Other delays -act or neglect of the Owner, or of an employee of either, or of a separate contractor employed by the Owner, or by changes ordered in the Work or by unavoidable casualties or other causes beyond the Contractor's control. Section 14. Change Order 14.1. The HRA shall have the right, within the general scope of the Work and without notice to any surety or sureties of the Contractor, if any, to make changes in the Work, either by altering the nature of the same or by adding to or deducting from it. All changes shall, except in the case of emergencies endangering the safety of persons or property, be made by written Change Order. The parties shall determine the effect of any Change Order on the Contract Price and project schedule by mutual agreement. -The Contractor shall promptly comply with any and all written Change Orders. No such Change Order shall be deemed to invalidate the remaining terms and conditions contained in the Contract. Section 15. Waiver of Liability 15.1 It is agreed that the Work is undertaken at the sole risk of the Contractor. The Contractor does expressly forever release the HRA and the City of Richfield from any claims, demands, injuries, damage actions, or causes of action whatsoever, arising out of or connected with the Work. Section 16. Indemnification 16.1. Any and all claims that arise or may arise as a consequence of any act or omission on the part of the Contractor, -its agents, servants, or employees while engaged in the - performance of the Work shall in no way be the obligation or responsibility of the HRA or the City of Richfield. The Contractor shall indemnify, hold harmless, and defend the HRA and the City of Richfield, its commissioners, council members, officers, employees, 314396v2 MTN RC125-1 9 ~~~D successors, and assigns against any and all liability, loss, cost, damages, expenses, claims, or actions, including attorney's fees which the HRA and the City of Richfield, its commissioners, council members, officers, or employees may hereinafter incur or be required to pay on account of injury to or death of any person or persons or damage to any property arising out of or by reason of any act or omission of the Contractor, its agents, servants, or employees in the execution, performance, or failure to adequately perform its obligations under this Agreement, whatever the cause of such injuries or damage. Section 17. Insurance 17.1. .The Contractor agrees that in order to protect itself, the HRA, and the City of Richfield under the indemnity provisions set forth in Section 16 of this Agreement, it will at all times during the term of this Agreement, maintain, at a minimum, the following insurance policies: a. Workers Compensation Insurance. The Contractor shall maintain worker's compensation insurance in compliance with all applicable statutes including Chapter 176 of the Minnesota Statutes. Such policy shall include Employer's Liability Coverage and at least such amount(s) as are customarily provided in worker's compensation policies issued in Minnesota. Contractor further agrees to require all subcontractors and independent contractors to maintain worker's compensation insurance in compliance with all applicable statutes and to monitor the compliance of such subcontractors and independent contractors with the applicable statutes. b. Commercial General Liability Insurance. The Contractor shall maintain Occurrence Based Commercial General Liability Insurance ("CGL"), providing coverage on an "occurrence", rather than on a "claims made" basis, which policy shall include coverage for the Completed Operations Hazard, and which shall also include a Broad Form General Liability Endorsement, ISO number GL 0404, or an equivalent form (or forms), so long as such an equivalent form (or forms) affords coverage which is in all material respects at least. as broad. Any equivalent form (or forms) of coverage shall be approved by the HRA. The Contractor agrees to maintain total liability policy limits of at least One Million Dollars ($1,000,000), applying to liability for Bodily Injury, Personal Injury, and Property Damage, which total limits may be satisfied by the limits afforded under its Occurrence Based CGL policy as specified above, or by such policy in combination with the limits afforded by an Umbrella Liability Policy (or policies) provided, however, that the coverage afforded :under any such Umbrella Liability Policy shall be at least as broad as that afforded by the underlying occurrence based CGL Policy as specified above. 314396x2 MTN RC125-1 10 ~~~~ c. Automobile Liability Insurance. The Contractor shall maintain automobile liability insurance covering liability for Bodily Injury and Property Damage arising out of the ownership, use, maintenance, or operation of all owned, non-owned, and hired automobiles and other motor vehicles. Such policy shall provide total liability limits for combined Bodily Injury and/or Property Damage in the amount of at least One Million Dollars ($1,000,000) per accident, which total limits may be satisfied by the limits afforded under such policy, or by such policy in combination with the limits afforded by an Umbrella Liability Policy (or policies) provided, however, that the coverage afforded under any such Umbrella Liability Policy shall be at least as broad as that afforded by the underlying automobile liability insurance policy. The HRA and the City of Richfield shall be named as "additional insured" parties with respect to the insurance policies specified in (b) and (c) above. The Contractor shall not commence work until a Certificate of Insurance evidencing all of the insurance policies required above is approved and a written Notice to Proceed is issued by an authorized representative of the HRA. The HRA shall, at any time during the term of this agreement, have the right to require that the Contractor secure any additional insurance, or additional feature to existing insurance, as the HRA may reasonably require for the protection of its interests or those of the public. It is expressly understood that the HRA does not in any way represent that the minimum insurance coverage set forth in this paragraph is sufficient or adequate to protect the interest or liabilities of the Contractor. Section 18. Bond 18.1. No .payment or performance bonds for the Work shall be required pursuant to Minn. Stat. § 574.26. 314396v2 M'IN RC125-1 11 ~,~a Section 19. Lien Waiver 19.1. Neither the Contractor nor any subcontractor or other person or entity funiishing labor, equipment, or materials in connection with the Work shall file any mechanic's lien against the HRA's buildings, structures or land or any part thereof, provided that the HRA makes all payments due to Contractor under this Contract. The Contractor shall protect, defend, indemnify, and hold harmless the HRA and the City of Richfield from any and all claims, demands, or actions of whatever nature arising out of work, labor, equipment, or materials furnished by the Contractor or its subcontractors in connection with the Work, provided that the HRA makes all payments due to Contractor under this Contract. Payment of the Contract Price shall not be due until the Contractor has delivered to the HRA lien waivers acceptable to the HRA, which release the HRA from all liens that may arise in connection with the Work. The Contractor shall list on the attached Exhibit A the names of all suppliers and/or subcontractors that will provide materials, services, or labor in connection with the Work. The Contractor will notify the HRA of any changes in this list prior to the commencement of the Work. Section 20. Subcontractors 20.1. Contractor agrees to bind -every subcontractor by the terms, conditions, and provisions set forth in the Contract that are applicable to the subcontractor's work, unless otherwise specifically agreed otherwise in writing by the HRA. 20.2. Contractor agrees to pay every subcontractor within 10 days of receipt of payment from the HRA pursuant to Minn. Stat. § 471.425. Section 21. Assignment 21.1. This Contract shall be binding upon the Contractor, its legal representatives, heirs, successors, and assigns. No assignment or attempted assignment of this Contract or any rights hereunder shall be effective unless the written consent of the HRA is first obtained. No such assignment, even if consented to by the HRA, shall relieve -the Contractor from liability under this Contract for the performance and completion of the Work in accordance with the Contract. Notwithstanding the foregoing, Contractor shall be entitled to use subcontractors to perform the Work. Section 22. Entire Agreement 22.1. The Contract contains all the terms, conditions, and provisions pertaining to the Work to be completed by the Contractor, there being no other understandings, agreements, or warranties; express or implied. All prior negotiations and dealings regarding the subject matter of the Agreement are superseded by and merged into the Contract. 314396v2 MTN RC125-1 12 ~ ~~3 Section 23. Applicable Law 23.1. This Contract shall be construed in accordance with and governed by the laws of the state of Minnesota. Section 24. Amendment 24.1. This Contract may be modified or amended only with the written approval of the HRA and the Contractor. Section 25. Construction 25.1. Iri the event that any one or more of the provisions of this Contract,. or any application thereof, shall be found to be invalid, illegal, or otherwise unenforceable, the validity, legality, and enforceability of the remaining provisions or any application thereof shall not in any way be affected or impaired thereby. Section 26. Authority, 26.1. Each of the undersigned parties warrants that it has the full authority to execute this Contract, and each individual signing this Contract on behalf of a corporation hereby warrants that he or she has full authority to sign on behalf of the corporation and that he or she represents and binds such corporation thereby. Section 27. Waiver 27.1. No failure by the HRA to insist upon the strict performance of any covenant, duty, agreement, or condition contained in this Agreement or to exercise any right or remedy consequent upon a breach thereof shall., constitute a waiver of any such breach or any other covenant, agreement, term, or condition, nor does it imply that such covenant, agreement, term, or condition may be waived again. Section 28. Payments to Contractor and Completion 28.1. The Contractor shall be paid upon completion of the Work in accordance with the payment schedule of the HRA, if any, and this section. 28.2. Application for Pam. Prior to receiving payment for Substantial Completion of the Work, the Contractor shall in writing state that the respective portion of the Work has been substantially completed and is free and clear of all liens as provided in this Contract. -Upon Substantial Completion and inspection and verification by the HRA, the payment for that portion of the Work shall be made. Final payment shall be made when Contractor certifies that Final Completion has been achieved and verified by the HRA. 314396v2 MTN RC125-1 13 ~-i~ IN WITNESS WHEREOF, the parties have caused this Contract to be duly executed in their names and behalves and on or as of the date and year first above written. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD By Suzanne M. Sandahl Its Chair By Steven L. Devich Its Executive Director 314396v2 MTN RC125-1 14 ~.i5 CONTRACTOR By Its By Its THIS INSTRUMENT DRAFTED BY: Kennedy & Graven, Chartered (MTN) 470 U.S. Bank Plaza 200 South Sixth Street Minneapolis, MN 55402 (612) 337-9300 314396-v1.DOC 314396x2 MTNRC125-1 15 ~f~~~ EXHIBIT A LIST OF SUPPLIERS AND SUBCONTRACTORS 314396v2 MTN RC125-1 A-1 AGENDA ITEM # 5 REPORT # 2 $ J STAFF REPORT HOUSING AND REDEVELOPMENT AUTHORITY MEETING AUGUST 16, 2010 REPORT PREPARED BY: JULIE URBAN, HOUSING SPECIALIST REPORT PRESENTER: DEPARTMENT DIRECTOR REVIEW: REVIEWED BY EXECUTNE DIREC NAME, TITLE JOHN STARK, COMMUNITY DEVELOPMENT DIRECTOR s NAME, Tirr,E ITEM FOR HRA CONSIDERATION: Consideration of a resolution authorizing the Executive Director and Housing and Redevelopment Authority Chair to execute instruments to purchase vacant and foreclosed properties using the Housing and Redevelopment Fund.. RECOMMENDED ACTION: By Motion: Approve a resolution authorizing the Executive Director and Housing and Redevelopment Authority Chair to execute instruments necessary to purchase up to nine vacant and foreclosed houses using up to $1,060,000 from the Housing -and Redevelopment Fund through December 31, 2010. II. BACKGROUND On January 19, 2010 the Housing and Redevelopment Authority (HRA) authorized the Executive Director and HRA Chair to execute instruments necessary to purchase up to five vacant and foreclosed houses using up to $494,350 from the Housing and Redevelopment Fund. That authorization is good through December 31, 2010. Under that authorization, the HRA purchased four properties. 08162010 Foreclosure Purchase Authority Hsg Trust The original authorization was based on the 2010 Budget. The proposed increase of five additional properties, bringing the total purchases to nine houses of up to $1,060,000 in total is based on the proposed Revised Budget for 2010. The requested increase in funding reflects funding that was approved for these programs in fiscal year 2009, but was not expended at that time. Given the current housing market, staff has the opportunity to continue purchasing substandard, vacant and foreclosed properties at very reasonable prices. The HRA budgets funds to purchase properties to further the Richfield Rediscovered and New Home Programs by removing small; substandard, obsolete, or dilapidated homes and then replacing them with new homes. The housing market offers an opportunity to further these programs and to help stabilize neighborhoods. Currently vacant and foreclosed properties are moving very quickly from the market. Under the normal acquisition process, staff negotiates the purchase of a property and brings it to the HRA for consideration. In order to work with bank-owned properties to secure the homes, there is a need to be able to act more quickly. As a result, staff is proposing that the Executive Director and HRA chair be given the authority to acquire foreclosed properties with funds identified in the 2010 Revised HRA Budget (as presented on August 16, 2010) meeting the following parameters without obtaining HRA approval for each property: • the property is foreclosed, • the property is vacant, • the property is blighted (as defined and required by the regulations governing the Housing and Redevelopment Fund), • prior to acquisition, staff establish an appropriate sale price based on recent sales activity and/or assessed value and housing condition; and • Expenditures for all nine properties do not exceed a total of $1,060,000. Staff will continue to report back to the HRA each month with a status report of acquisition activity. -Each acquisition will be brought as an informational item to the HRA at their closest meeting following the purchase. III. BASIS OF RECOMMENDATION A. POLICY • It is in the best interest of the City to ensure neighborhood stability and reduce blight. • Through the City's Richfield Rediscovered program, the HRA purchases and removes substandard and functionally obsolete housing and replaces it with newer, higher valued homes. • Through the City's New Home program, the HRA purchases and removes substandard and functionally obsolete housing and replaces it with new, affordable homes. o Encourage the creation of "move-up" housing through new construction and home remodeling. o Promote the development of a balanced housing stock that is available to a range of income levels. B. CRITICAL ISSUES • Richfield has suffered a high number of foreclosures over the past two years and is expected to have more over the next several years. • Neighborhoods in which there are one or more foreclosed and vacant homes have detrimental impacts on the surrounding property values. • The market of vacant and foreclosed properties is moving rapidly and staff needs flexibility to respond quickly to opportunities to purchase vacant and foreclosed properties. • Staff uses two "first look" programs that offer cities and non-profits the chance to purchase properties before they are available on the open market; however, they both require a .response to purchase within days. • In addition to being in poor condition, some foreclosed properties have function, layout, size and other issues that make them candidates for the Richfield Rediscovered and New Home programs. • The Richfield Rediscovered and New Home program funds can be used to purchase vacant and foreclosed properties to accomplish HRA goals throughout the City of Richfield. • Authorization to utilize these two HRA programs would be limited to purchasing vacant and foreclosed properties only. If other purchasing opportunities arise staff would seek an approved Purchase Agreement by the HRA before moving forward with purchasing activities. C. FINANCIAL • The revised budget for 2010 would designate $663,000 for the Richfeld Rediscovered program and $397,000 for the New Home program for a total of $1,060,000 for property acquisition for fiscal year 2010. • Funding for these programs is allocated through the HRA Housing and Redevelopment Fund. • Total acquisition expenditures will not exceed the revised budgeted amount of $1,060,000. D. LEGAL • Legal counsel reviewed the resolution. ALTERNATIVE KECOMMENDATION(S) ~ • Do not extend the authorization for the Executive Director and HRA Chair to execute agreements to purchase foreclosed homes. ~ V. ATTACHMENTS ~ I V L YRINCII'AL PARTIES EXPECTED AT MEETING I S I RESOLUTION NO. RESOLUTION AUTHORIZING THE HOUSING AND REDEVELOPMENT AUTHORITY STAFF TO ACQUIRE CERTAIN FORECLOSED HOMES WITHIN THE CITY AND TO EXECUTE ALL INSTRUMENTS AND CONTRACTS RELATED THERETO WHEREAS, pursuant to Minnesota Statutes, Sections 469.001 to 469.047 (the "HRA Act") the City Council of the City of Richfield, Minnesota (the "City") has created the City of Richfield Housing and Redevelopment Authority (the "HRA") and provided it with the powers and duties of the HRA Act; and WHEREAS, the HRA Act authorizes the HRA to acquire, improve, own, hold, sell, lease, exchange, transfer, assign, pledge or dispose of any real or personal property; and WHEREAS, the HRA has undertaken amulti-faceted response to the impact of the foreclosure crisis on the community involving the use of the Housing and Redevelopment Fund to acquire and demolish substandard, vacant, foreclosed single family homes; and WHEREAS, in order to expand the effectiveness of the Program the HRA wishes to directly purchase certain foreclosed properties to demolish and hold the lots for future development; and WHEREAS, it is the desire of the HRA Board of Commissioners to establish certain parameters for such acquisitions and to authorize its Executive Director and HRA Chair to proceed therewith without specific Board approval of each transaction. NOW, THEREFORE, BE IT RESOLVED by the City of Richfield Housing and Redevelopment Authority: 1. That the Executive Director and HRA Chair, with the assistance of HRA legal counsel, is hereby authorized to enter into purchase agreements and acquire in the name of the Authority up to nine (9) single family, vacant, foreclosed homes (the "Properties") on the conditions that: (a) The Properties are each acquired with the Housing and Redevelopment Fund; (c) Each Property is a foreclosed property acquired from a lender or a lender's designee; (d) The Properties have been vacant for at least 90 days prior to entering into a Purchase Agreement; (e) The Property is determined to be blighted as required by Housing and Redevelopment Fund regulations; (f) Prior to each acquisition staff establish an appropriate sale price based on reasonable conditions; -~ (g) .The total expenditures on all nine properties does not exceed $1,060,000; and (h) Prior to the acquisition of each property staff conducts appropriate due diligence to protect the HRA's interest. 2. That the Executive Director and HRA Chair are authorized to execute such documents as shall be required in order to carry out the delegation provided in paragraph 1 hereof. 3. -That the Executive Director shall report the acquisition of any Property pursuant to this Resolution at the next regular HRA meeting. 4. That disposition of acquired Properties shall be only by action of this Board. 5. That the authority granted hereby shall expire on December 31, 2010. Adopted by the Richfield Housing and Redevelopment Authority of the City of Richfield, Minnesota this 16th day of August, 2010. Suzanne M. Sandahl, Chair ATTEST: Joan Helmberger, Secretary STAFF REPORT AGENDA ITEM # REPORT # HOUSING AND REDEVELOPMENT AUTHORITY MEETING ~~ ~~~~ AUGUST 16, 2010 6 29 REPORT PREPARED BY: CHRIS REGIS, FINANCE MANAGER NAME, TITLE REPORT PRESENTER: DEPARTMENT DIRECTOR REVIEW: CHRIS REGIS, FINANCE MANAGER NAME, T/TLE SIGNA REVIEWED BY EXECUTIVE DIRECTOR: ITEM FOR HRA CONSIDERATION: Consideration of resolutions approving proposed property tax levy for payable 2010 for certification to Hennepin County. I. RECOMMENDED ACTION: By Motion: Adopt the attached resolutions approving the 2011 Proposed Housing and Redevelopment Authority Budget and Tax Levy and 2010 Revised Housing and Redevelopment Authority Bud et. II. BACKGROUND N/A III. BASIS OF RECOMMENDATION A. POLICY • Minnesota Statutes require adoption of a preliminary levy from each taxing authority. • The budget and accompanying proposed levy for 2011 are ready for consideration. • Even though a pubic hearing for the HRA tax levy is not required by State Statute, this does not preclude the HRA from opening this item up for public discussion if the HRA desires to do so. B. CRITICAL TIMING ISSUES • As required by State Statutes, each taxing authority must certify its proposed tax levy for the payable year 2011 to the County Auditor on or before September 15, 2010. C. FINANCIAL • The Proposed 2011 HRA levy represents a 6.98% decrease from the previous year's levy. • The levy as proposed is for the maximum levy established by law of the .0185% of the City's total taxable market value. D. LEGAL • N/A IV. ALTERNATIVE RECOMMENDATION~S~ • The HRA could adopt a preliminary levy less than the one proposed herein. However, that would not provide for programs that are recommended in the 2010 Revised/2011 Proposed budget. V. ATTACHMENTS • Resolution Approving Proposed 2011 Housing and Redevelopment Authority Budget and Certifying the 2011 Tax Levy • Resolution Authorizing Revision of the 2010 Budget of the Housing and Redevelopment Authority of Richfield VI. PRINCIPAL PARTIES EXPECTED AT MEETING • N/A 0816budget ~/ l HRA RESOLUTION NO. RESOLUTION APPROVING PROPOSED 2011 HOUSING AND REDEVELOPMENT AUTHORITY BUDGET AND CERTIFYING THE 2011 TAX LEVY BE IT RESOLVED by the Housing and Redevelopment Authority of the City of Richfield, Minnesota as follows: Section 1. The budget for the Housing and Redevelopment Authority General Fund of Richfield for the year 2011 in the amount of $590,060 is hereby ratified. Section 2. The estimated gross revenue of the Housing and Redevelopment Authority General Fund of Richfield from all sources, including general ad valorem tax levies as hereinafter set forth for the year 2011, and as the same are more fully detailed in the Executive Director's official copy of the budget for the year 2011, in the amount of $548,250 is hereby approved. Section 3. There is hereby levied upon all taxable property in the City of Richfield an ad valorem tax in 2010, payable in 2011 for the following purposes: Housing and Redevelopment Authority $552,812 Section 4. A certified copy of this resolution shall be transmitted to the County Auditor. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 16th day of August, 2010. Suzanne M. Sandahl, Chair ATTEST: Joan Helmberger, Secretary 0816budget ~~~ HRA RESOLUTION NO. RESOLUTION AUTHORIZING REVISION OF THE 2010 BUDGET OF THE HOUSING AND REDEVELOPMENT AUTHORITY OF RICHFIELD WHEREAS, Resolution No. 1054 appropriated funds for personal services and other expenses and capital outlay for the Housing and Redevelopment Authority for the year 2009, and WHEREAS, The Executive Director has requested a revision of the 2010 budget as detailed in the 2011 budget document. NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority of Richfield, Minnesota as follows: Section 1. That the 2010 appropriation for the Housing and Redevelopment Authority General Fund is revised as follows: $67,670 decrease Section 2. Estimated 2010 gross revenue of the Housing and Redevelopment Authority General Fund from all sources, as the same is more fully detailed in the Executive Director's official copy of the 2011 budget document, are hereby revised as follows: $11,000 decrease Section 3. That the Executive Director bring into effect the provisions of this resolution. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 16th day of August, 2010. ATTEST: Joan Helmberger, Secretary Suzanne M. Sandahl, Chair 0816budget