121823 Complete AgendaR E G U LAR H O U S IN G AN D R E D E V E LO P ME N T AU TH O R ITY ME E TIN G
R IC H F IE L D MU N IC IPAL C E N TE R, C O U N C IL C H AMB E R S
D E C E MB E R 18, 2023
7:00 P M
C all to Order
Open F orum
E ach speaker is to keep their comment period to three minutes to allow sufficient time for others. C omments
are to be an opportunity to address the H R A . P lease refer to the H R A agenda and minutes web page for
additional ways to submit comments. C all into the open forum by dialing 1-415-655-0001 U se webinar access
code: 2630 863 1867 and password: 1234.
Approval of the Minutes
A pproval of the minutes of the Regular Housing and Redevelopment A uthority meeting of November 20, 2023
AG E N D A APPR O VAL
1.A pproval of the A genda
R E S O L U T IO N S
2.C onsideration of the adoption of a resolution approving a F irst A mendment to the A mended and Restated
C ontract for P rivate D evelopment with 101 E 66th S T L L C related to the construction of an 80-unit mixed use
project at 101 - 66th S treet E ast.
S taff Report No. 34
P U B LIC H E AR IN G S
3.P ublic hearing regarding the sale of 6613-25 P ortland Avenue S outh to B eacon Interfaith Housing C ollaborative,
doing business as A ster C ommons L imited P artnership and A ster C ommons GP L L C .
S taff Report No. 35
H R A D IS C U S S IO N ITE MS
4.HRA D iscussion Items
E X E C U T IV E D IR E C TO R R E P O R T
5.E xecutive D irector's Report
C LAIMS
6.C laims
7.A djournment
Auxiliary aids for individuals with disabilities are available upon request. Requests must be made at least 96
hours in advance to the City Clerk at 612-861-9739.
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING MINUTES
Richfield, Minnesota
Regular Meeting
November 20, 2023
CALL TO ORDER
Chair Vrieze Daniels called the meeting to order at 7:00 p.m. in the Council Chambers.
HRA Members
Present:
Erin Vrieze Daniels, Chair; Mary Supple; Sean Hayford Oleary;
John Young; and Gordon Hanson
HRA Members
Absent
Staff Present: Melissa Poehlman, Executive Director; Julie Urban, Assistant
Community Development Director; Jan Youngquist, Economic
Development Manager; and Dustin Leslie, City Clerk.
OPEN FORUM
Chair Vrieze Daniels gave instructions on how to participate in the open forum.
Rod Sather – 63rd and Thomas: Residents spoke about short-term rentals and how they
needed to be addressed due to their impact on the local housing market.
APPROVAL OF THE MINUTES
M/Hanson, S/Supple to approve the 1) minutes of the regular Housing and
Redevelopment Authority meeting of October 16, 2023.
Motion carried: 5-0
ITEM #1
APPROVAL OF THE AGENDA
M/Hayford Oleary, S/Supple to approve the agenda.
Motion carried: 5-0
HRA Meeting Minutes -2- November 20, 2023
ITEM #2
APPROVAL OF THE CONSENT CALENDAR
Executive Director Poehlman presented the Consent Calendar.
A. Consideration of a resolution approving an extension to the Grant Agreements with
Woodlawn Terrace Cooperative until December 31, 2024 (Staff Report #27).
B. Consider a resolution designating buildings formerly located at 7700 and 7730 Portland
Avenue South and the existing structure at 500 78th Street East as structurally
substandard within the Richfield Redevelopment Project Area (Staff Report #28).
C. Consider the approval of a resolution accepting contributions for the 2023 Tour of
Remodeled Homes (Staff Report #29).
Chair Vrieze Daniels removed item B from the consent calendar.
M/Hayford Oleary, S/Hanson to approve the Consent Calendar with the exception of item
B which was pulled for further consideration.
Motion Carried: 5-0
ITEM #3
CONSIDERATION OF ITEMS, IF ANY, REMOVED FROM THE CONSENT
CALENDAR
Executive Director Poehlman gave the report for item B.
Chair Vrieze Daniels asked which properties were owned by MnDOT. Executive
Director Poehlman stated only properties A & B were owned by MnDOT. Chair Vrieze
Daniels asked if there were plans to create a TIF district for the remnants of the
property. Executive Director Poehlman mentioned that would be a possible option.
Chair Vrieze Daniels asked why they were being asked to approve this item if the
buildings have already been demolished. Executive Director Poehlman stated it would
give staff redevelopment options. Rebecca Kirtz with Ehlers stated that by approving
this, it would preserve the ability to create a TIF district in the future because
substandard building findings would be needed. There was also a discussion about the
timeline of events.
M/Supple, S/Young to approve the resolution designating buildings formerly
located at 7700 and 7730 Portland Avenue South and the existing structure at 700 78th
Street East as structurally substandard within the Richfield Redevelopment Project
Area.
Motion Carried: 5-0
HRA Meeting Minutes -3- November 20, 2023
ITEM #4
CONSIDERATION OF A MODIFICATION TO THE TAX INCREMENT FINANCING
PLAN, TAX INCREMENT FINANCING DISTRICT 2018-1,
RF64, WITHDRAWING PARCELS FROM THE DISTRICT.
Assistant Director Urban gave the report.
Commissioner Supple asked what would happen if the city was not able to pay back the
funds. Assistant Director Urban stated there would be money in escrow which would be enough
to cover costs.
Commissioner Hayford Oleary and Assistant Director Urban spoke about the history of
purchases. Commissioner Hayford Oleary asked if costs were recovered in the original sale of
land. Assistant Director Urban stated the road project was able to cover the costs.
M/Hayford Oleary, S/Young to adopt a resolution approving a modification to the Tax
Increment Financing Plan, Tax Increment Financing District 2018-1, RF64, and withdrawing
parcels from the District.
Motion Carried: 5-0
ITEM #5
CONSIDER ACCEPTANCE OF THE RICHFIELD HOUSING AND
REDEVELOPMENT AUTHORITY TAX INCREMENT FINANCING DISTRICT
STATUS UPDATE.
Executive Director Poehlman introduced Rebecca Kirtz from Ehlers who gave the
presentation which included: an overview of the TIF management plan, findings, direct summary
of TIF districts, impacts of decertified districts, outstanding obligations, Best Buy project
overview, pooling opportunities, special legislation, affordable housing, compliance issues,
administrative expenses, and findings and recommendations.
Commissioner Young asked about the Emi project on 66th. Executive Director Poehlman
gave a summary of the project and an update on its development.
Commissioner Supple and Chair Vrieze Daniels thanked the presenter for a thorough
presentation.
M/Hayford Oleary, S/Hanson to accept the Richfield Housing and Redevelopment
Authority Tax Increment Financing District report.
Motion Carried: 5-0
ITEM #6
CONSIDERATION OF A MEMORANDUM OF UNDERSTANDING WITH DANI,
LAURA, AND MARIELA JIMENEZ RELATED TO THE HOUSING
AND REDEVELOPMENT AUTHORITY PROPERTY LOCATED AT 1430 66TH
STREET EAST FOR CONSTRUCTION OF A BAKERY AND DELI.
Economic Development Manager Youngquist gave the report.
HRA Meeting Minutes -4- November 20, 2023
Commissioner Young asked how City-owned parcels were marketed to the public.
Economic Development Manager Youngquist spoke about the city’s development process.
Commissioner Young asked if there was any other interest in the parcel. Executive Director
Poehlman stated there was other interest in the parcel, but this proposal was more in line with
the Comprehensive Plan.
M/Supple, S/ Young to approve the memorandum of understanding with Dani, Laura,
and Mariela Jimenez.
Motion Carried: 5-0
ITEM #7
CONSIDERATION OF A MEMORANDUM OF UNDERSTANDING WITH LYNDALE
GARDENS, LLC.
Economic Development Manager Youngquist gave the report.
Commissioner Young asked when a developer is chosen if the HRA would make final
approval on using them for the development. Economic Development Manager Youngquist
stated that was correct. Commissioner Young also asked about the cost of the building and if
the contributions would cover it. Youngquist spoke about the costs involved in the project.
Commissioner Young asked why a mixed-use property was not being considered for this
parcel. Economic Development Manager Youngquist spoke about a proposal that was a mix of
housing and commercial development, but parking became an issue. There were also visibility
issues with the lake and amphitheater.
M/Gordon, S/Young to approve the memorandum of understanding with Lyndale
Gardens, LLC.
Motion Carried: 5-0
ITEM #8
HRA DISCUSSION ITEMS
Commissioner Supple spoke about the new business bulletin newsletter.
Chair Vrieze Daniels spoke about the potential opening on the HRA/EDA and
encouraged people to apply.
ITEM #7
EXECUTIVE DIRECTOR REPORT
No report.
HRA Meeting Minutes -5- November 20, 2023
ITEM #8
CLAIMS
M/Hanson, S/Supple that the following claims be approved:
U.S. BANK 11/20/2023
HRA Checks: #36958-36974 $103,534.37
Section 8 Checks: #135278-135353 $196,566.19
TOTAL $300,100.56
Motion carried: 5-0
ITEM #9
ADJOURNMENT
The meeting was adjourned by unanimous consent at 8:32 p.m.
Date Approved: December 18, 2023
Gordon Hanson
HRA Acting Chair
Dustin Leslie Melissa Poehlman
City Clerk Executive Director
AGENDA SECTION:RESOLUTIONS
AGENDA ITEM #2.
S TAFF REPORT NO. 34
HOUSING AND RE DEVELOPMENT AUT HORIT Y
MEET ING
12/18/2023
RE P O RT P RE PA RE D B Y: J an Youngquist, E conomic D evelopment Manager
O THE R D E PA RTM E NT RE V IE W:
E X E C UTIV E D IRE C TO R RE V IE W: Melissa P oehlman, E xecutive D irector
6/14/2023
I T E M F O R C O UNC IL C O NS ID E RAT I O N:
Consideration of the adoption of a resolution approving a First Amendment to the Amended and
Restated Contract for Private Development with 101 E 66th S T L LC related to the construction of an
80-unit mixed use project at 101 - 66th Street East.
E X E C UT IV E S UM M ARY:
The property at 101 - 66th Street East was first vacated in 2013. After three years of neglect, it was
purchased for redevelopment by P L H & Associates in 2016. After many years of work, the City approved
plans for a 42-unit mixed use building in October 2020, and the Housing and Redevelopment Authority (HRA)
approved a Contract for Private Development to provide financial assistance in the form of Tax I ncrement in
J anuary 2021. Shortly thereafter, P L H sold the property to 101 E 66th S T LLC (Developer).
I n J une 2021, the Developer presented new plans for redevelopment of the site and on J anuary 11, 2022, the
City Council approved plans for the development of an 80-unit, 5-story mixed use building. On J une 21, 2022,
the HRA approved a Contract for Private Development and issuance of a Tax I ncrement Financing (TI F)
Note for up to $2,300,000.
I ncreases in construction and labor c osts as well as rising interest rates impacted the D eveloper's budget.
Ehlers, the HRA’s financ ial consultant, reviewed the D eveloper ’s revised project finances and based on
Ehlers’ analy sis, the HRA approved an Amended and Restated Contract for Private Development (Contract)
and issuance of TI F Note for up to $2,685,000 on J une 20, 2023. The C ontrac t requires that construction
commence by December 31, 2023 and be substantially complete by December 31, 2025.
The building permit for the projec t has been approved and is ready to be issued. Challenging economic
conditions have made the project difficult to financ e, however. The Developer is exploring several options,
including bringing in a partner to help financ e the projec t. The Developer is making progress and has
requested an extension to the C ontrac t. A request to extend the land use approvals is anticipated to be
considered by the City Council on J anuary 9, 2024.
The attached First Amendment to Amended and Restated Contract for Private D evelopment (Amendment)
grants a 90-day extension to commence construction, with the ability of the HRA E xecutive Director to
authorize an additional extension for up to 90 day s. I f the Developer commences c onstruc tion within 180
days, the HRA Executive Director shall adjust the dates of c ommenc ement and substantial c ompletion in the
Contract.
Additionally, the Amendment clarifies that the TI F Note will be pay able solely from the increment generated
from the TI F Distric t throughout the duration of TI F Distric t, rather than from the first 16 years of the TI F
District. This is a holdover provision from the original C ontrac t with P L H that should have been revised as part
of the Amended and Restated Contract, but was inadvertently missed.
Failure to extend the agreement would require the Developer to begin the approval proc ess anew. Delays will
continue to reduc e the amount of tax increment that will be available to the project; making redevelopment that
much more diffic ult. The proposal remains in complianc e with the goals of the Comprehensive Plan and staff
believes that helping this partic ular project to move forward remains the best option for the community and
immediate neighborhood.
RE C O M M E ND E D AC T I O N:
By motion: Approve a Resolution approving a First Amendment to the Amended and Restated
Contract for Private Development with 101 E 66th S T L LC.
B AS IS O F RE C O M M E ND AT I O N:
A .H IS TOR IC AL C ON T E X T
S outhview B aptist C hurch vacated the property and began marketing it for sale in 2013.
D eveloper P L H & A ssociates purchased the property in 2016.
June 26, 2018 - The C ity C ouncil approved land use applications for a 31-unit mixed use development.
May 28, 2019 and May 12, 2020 - The C ity C ouncil approved extensions of the land use approvals.
June 15, 2020 - Revised plans with reduced commercial space and affordable units were presented to
the C ity C ouncil and HRA .
July 14, 2020 - The C ity C ouncil approved an application for L ivable C ommunities D evelopment
A ccount grant funds through the Metropolitan C ouncil (not awarded).
July 20, 2020 - The HRA approved a P reliminary D evelopment A greement.
October 13, 2020 - The C ity C ouncil approved a revised land use application for a 42-unit mixed use
development.
January 19, 2021 - The HRA approved a C ontract for P rivate D evelopment and issuance of a TIF Note
(not executed).
May 2021 - P L H & A ssociates sold the project to North B ay C ompanies, dba 101 E 66th S T L L C
(D eveloper).
June 21, 2021 - The D eveloper presented plans for a 75-unit, 6-story mixed use building at a joint work
session of the C ity C ouncil, HRA , and P lanning C ommission.
January 11, 2022 - The C ity C ouncil approved land use plans for an 80-unit, 5-story mixed use building.
June 6, 2022 - The HRA approved a C ontract for P rivate D evelopment and issuance of a TIF Note for
up to $2,300,000.
F ebruary 14, 2023 - The C ity C ouncil approved an extension of the land use approvals until January 11,
2024.
June 20, 2023 - The HRA approved an A mended and Restated C ontract for P rivate D evelopment and
issuance of a TIF Note for up to $2,685,000.
B .E QU ITAB L E OR S T R AT E GIC C ON S ID E R AT ION S OR IMPAC T S
The approved project consists of a mixed use building with 80 apartments and approximately 2,800
square feet of ground floor commercial space, which helps meet the S trategic P lan's desired outcome
of a vibrant downtown, by increasing the number of housing units and businesses downtown.
S ixteen of the apartments will be affordable to households earning up to 60% of the A rea Median
Income (A M I), which helps meet the S trategic P lan's desired outcome of maintaining Richfield as an
affordable place to live.
The project will help improve equitable outcomes by providing new housing options. In addition to 16
affordable units, the C ontract also requires that the development must include at least three "Type A "
units that include roll-in showers and grab bars; or at least two units that are A D A accessible.
C .P OL IC IE S (resolutions, ordinances, regulations, statutes, exc):
In a Redevelopment TIF D istrict, there are no statutory requirements related to housing affordability. The
HRA and C ity's Inclusionary Housing P olicy states that rental housing developments that receive
financial assistance must either:
Reserve 20% of the units for households earning up to 60% of the A MI; O R
C ontribute 15% of the available Tax Increment generated to the Richfield Housing and
Redevelopment F und.
D .C R IT IC AL T IMIN G IS S U E S:
The C ontract requires that construction commence by D ecember 31, 2023 and be substantially
complete by D ecember 31, 2025.
In F ebruary 2023, the C ity C ouncil approved an extension of the land use approvals, which requires that
substantial construction needs to be underway by J anuary 11, 2024.
The TIF D istrict was certified on March 16, 2021. In accordance with state statute, site improvements
must take place before March 16, 2025 or no tax increment from the site may be collected for the
duration of the TIF D istrict. The project is not financially feasible without tax increment.
E .F IN AN C IAL IMPAC T:
The C ontract calls for the D eveloper to receive up to $2,685,000 in TIF.
The TIF would be provided in the form of a "P ay-A s-You-Go" Note and would not pose a
financial risk to the HRA (the risk would be to the D eveloper if adequate property taxes were not
paid).
The development property will continue to generate and pay property taxes to all of the current
taxing jurisdictions (C ity, C ounty and S chool D istrict) based on the "base value" of the property.
The HRA would retain 10% of the TIF generated to reimburse the HRA for ongoing expenses
related to administration of the TIF D istrict.
The C ontract calls for a one-time "lookback" where the project's financial performance will be
reviewed and the principal amount of the TIF Note may be adjusted accordingly. B ased on this
analysis, the TIF Note will either be reduced or will not change.
F.L E GAL C ON S ID E R AT ION:
The A mendment and the Resolution were drafted by the HRA A ttorney, J ulie E ddington.
ALTE R N AT IV E R E C O MME N D ATIO N(S):
1. Do not approve the Resolution.
2. Approve the Resolution with modifications.
P R IN C IPAL PAR TIE S E X P E C TE D AT ME E TIN G:
Dan Oberpriller from 101 E 66th S T L L C.
AT TAC H ME N T S:
D escription Type
Resolution Resolution L etter
F irst A mendment to C ontract B ackup Material
E xecuted C ontract B ackup Material
L ocation and C omp P lan Map B ackup Material
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD, MINNESOTA
RESOLUTION NO. ______
RESOLUTION APPROVING A FIRST AMENDMENT TO THE AMENDED AND RESTATED
CONTRACT FOR PRIVATE DEVELOPMENT WITH 101 E 66TH ST LLC
WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield,
Minnesota (the “Authority”) was created pursuant to Minnesota Statutes, Sections 469.001 through
469.047, as amended, and was authorized to transact business and exercise its powers by a
resolution of the City Council of the City of Richfield, Minnesota (the “City”); and
WHEREAS, the City and the Authority has established the 2020-2 Tax Increment Financing
District – EMI (the “TIF District”), a redevelopment district within the Richfield Redevelopment
Project, pursuant to Minnesota Statutes, Sections 469.174 through 469.1794, as amended; and
WHEREAS, 101 E 66TH ST LLC, a Minnesota limited liability company (the “Developer”),
owns certain property in the City and has proposed to construct thereon approximately 80 rental
housing units, including sixteen affordable housing units, and approximately 2,800 square feet of
commercial space (the “Minimum Improvements”); and
WHEREAS, the Authority and the Developer previously entered into an Amended and
Restated Contract for Private Development (the “Original Development Agreement”) pursuant to
which the Developer agreed to construct the Minimum Improvements and the Authority agreed to
reimburse the Developer for certain public redevelopment costs associated with the Minimum
Improvements through the issuance of a tax increment revenue note (the “TIF Note”) in the
maximum principal amount of $2,685,000; and
WHEREAS, the Authority and the Developer have proposed to amend the Original
Development Agreement to clarify that the TIF Note will be payable solely from the Available Tax
Increment (as defined in the Original Development Agreement) generated from the TIF District
throughout the duration of the TIF District; and
WHEREAS, the Developer is required to commence construction by December 31, 2023
and the Authority proposes an extension of ninety (90) days with the ability of the Executive
Director of the Authority to authorize an additional extension of up to ninety (90) days to commence
construction; and
WHEREAS, if the Developer commences construction within the extension period, the
Executive Director shall adjust the dates of commencement and completion of construction within
the Amended and Restated Contract, as amended; and
WHEREAS, there has been presented before this Board of Commissioners of the Authority
a First Amendment to the Amended and Restated Contract for Private Development (the “First
Amendment to Development Agreement”) between the Authority and the Developer, including a
revised form of the TIF Note, which amends the Original Development Agreement as described
herein; and
2
NOW, THEREFORE, BE IT RESOLVED, by the Board of Commissioners of the Housing
and Redevelopment Authority in and for the City of Richfield, Minnesota as follows:
Section 1. First Amendment to Development Agreement. The First Amendment to
Development Agreement is hereby in all respects authorized, approved, and confirmed, and the
Chair and the Executive Director are hereby authorized and directed to execute the First
Amendment to Development Agreement for and on behalf of the Authority in substantially the form
now on file with the Executive Director but with such modifications as shall be deemed necessary,
desirable, or appropriate, the execution thereof to constitute conclusive evidence of their approval
of any and all modifications therein.
Section 2. Miscellaneous.
2.01. The Chair and the Executive Director are hereby authorized to execute and deliver
to the Developer any and all documents deemed necessary to carry out the intentions of this
resolution and the Original Development Agreement, as amended by the First Amendment to
Development Agreement.
2.03. This resolution shall be effective upon adoption.
Adopted by the Housing and Redevelopment Authority in and for the City of Richfield,
Minnesota this 18th day of December, 2023.
Gordon Hanson, Acting Chair
ATTEST:
Sean Hayford Oleary, Secretary
FIRST AMENDMENT TO
AMENDED AND RESTATED CONTRACT FOR PRIVATE DEVELOPMENT
between
HOUSING AND REDEVELOPMENT AUTHORITY IN AND
FOR THE CITY OF RICHFIELD, MINNESOTA
and
101 E 66TH ST LLC
Dated December 18, 2023
This document was drafted by:
Kennedy & Graven, Chartered (JAE)
150 South Fifth Street, Suite 700
Minneapolis, Minnesota 55402-1299
Telephone: 612-337-9300
1
FIRST AMENDMENT TO
AMENDED AND RESTATED CONTRACT FOR PRIVATE DEVELOPMENT
THIS FIRST AMENDMENT TO AMENDED AND RESTATED CONTRACT FOR PRIVATE
DEVELOPMENT, made as of the _____ day of December, 2023 (the “Agreement”), is between the
HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD,
MINNESOTA, a public body corporate and politic under the laws of the State of Minnesota (the “Authority”),
and 101 E 66TH ST LLC, a Minnesota limited liability company (the “Developer”).
WITNESSETH:
WHEREAS, the Authority was created pursuant to Minnesota Statutes, Sections 469.001 through
469.047, as amended (the “HRA Act”), and was authorized to transact business and exercise its powers by a
resolution of the City Council of the City of Richfield, Minnesota (the “City”); and
WHEREAS, the Authority has undertaken a program to promote redevelopment and development of
land that is underused or underutilized within the City, and in this connection the Authority administers a
redevelopment project known as the Richfield Redevelopment Project (the “Redevelopment Project”) pursuant
to the HRA Act; and
WHEREAS, pursuant to the HRA Act, the Authority is authorized to undertake certain activities to
facilitate the redevelopment of blighted properties and promote the development of affordable housing within
the City; and
WHEREAS, within the Redevelopment Project, the Authority has created the 2020-2 Tax Increment
Financing District – EMI (the “TIF District”), a redevelopment district, in order to facilitate redevelopment of
certain property in the Redevelopment Project and promote the development of affordable housing within the
City; and
WHEREAS, the Developer owns certain property in the City (the “Development Property”) within the
TIF District and intends to construct thereon a mixed-use development, including approximately 80 apartment
units (including sixteen affordable units) and approximately 2,800 square feet of commercial space (the
“Minimum Improvements”); and
WHEREAS, in order to achieve the objectives of the redevelopment plan for the Redevelopment
Project and make the Minimum Improvements economically feasible for the Developer to construct, the
Authority is prepared to reimburse the Developer for a portion of land acquisition costs, site improvement costs,
infrastructure costs, demolition and remediation costs, and other costs related to the Minimum Improvements
that may be reimbursed with tax increment; and
WHEREAS, the Authority believes that the development of the TIF District pursuant to this
Agreement, and fulfillment generally of this Agreement, are in the vital and best interests of the City and the
health, safety, morals, and welfare of its residents, and in accord with the public purposes and provisions of the
applicable State of Minnesota and local laws and requirements under which the Redevelopment Project has
been undertaken and is being assisted.
NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto,
each of them does hereby covenant and agree with the other as follows:
2
FIRST AMENDMENT TO
AMENDED AND RESTATED CONTRACT FOR PRIVATE DEVELOPMENT
A. The following sections of the Amended and Restated Contract for Private Development are revised as
follows:
Section 3.4 of the Amended and Restated Contract for Private Development. Section 3.4 of the
Contract is revised to state the following: The Developer understands and acknowledges that the TIF Note is
payable solely from the Available Tax Increment generated in the first sixteen years of the from the TIF District.
The TIF District expires at the end of 2049.
REVISED EXHIBIT B (TIF Note) is revised as described in the attached Exhibit B.
B. The Authority hereby grants the Developer an extension of ninety (90) days to commence construction
with the ability of the Executive Director of the Authority to authorize an additional extension of up to ninety
(90) days to commence construction.
C. If the Developer commences construction on or prior to 180 days’ after December 18, 2023, the
Executive Director of the Authority shall revise the dates set forth in Section 4.3 of the Amended and Restated
Contract for Private Development.
S-1
IN WITNESS WHEREOF, the Authority has caused this First Amendment to Amended and Restated
Contract for Private Development to be duly executed in its name and behalf and the Developer has caused this
Amended and Restated Contract for Private Development to be duly executed in its name and behalf as of the
date and year first written above.
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD,
MINNESOTA
By
Its Acting Chair
By
Its Executive Director
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this ____ day of December, 2023, by Erin
Vrieze Daniels, the Chair of the Housing and Redevelopment Authority in and for the City of Richfield,
Minnesota, a public body corporate and politic under the laws of the State of Minnesota, on behalf of the
Authority.
Notary Public
STATE OF MINNESOTA )
) SS.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this ____ day of December, 2023, by Melissa
Poehlman, the Executive Director of the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota, a public body corporate and politic under the laws of the State of Minnesota, on behalf
of the Authority.
Notary Public
S-2
Execution page of the Developer to the First Amendment to Amended and Restated Contract for Private
Development, dated the date and year first written above.
101 E 66TH ST LLC
By
Its
STATE OF MINNESOTA )
) SS.
COUNTY OF __________ )
The foregoing instrument was acknowledged before me this ____ day of December, 2023, by
_________________________________, the _____________________________ of 101 E 66th St LLC, a
Minnesota limited liability company, on behalf of the Developer.
Notary Public
REVISED EXHIBIT B
FORM OF TIF NOTE
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF HENNEPIN
HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE
CITY OF RICHFIELD
No. R-1 $___________
TAX INCREMENT LIMITED REVENUE NOTE
SERIES ________
Date
Rate of Original Issue
6.1% __________, 20___
The Housing and Redevelopment Authority in and for the City of Richfield, Minnesota (the
“Authority”), for value received, certifies that it is indebted and hereby promises to pay to 101 E 66th St LLC,
a Minnesota limited liability company, or registered assigns (the “Owner”), the principal sum of $2,685,000
and to pay interest thereon at the rate per annum set forth above, as and to the extent set forth herein. Capitalized
terms used herein that are otherwise not defined shall have the meanings provided in the Amended and Restated
Contract for Private Development, dated _______________, 2023, as amended by the First Amendment to
Amended and Restated Contract for Private Development, dated December __, 2023 (the “Agreement”),
between the Authority and the Owner.
1. Payments. Principal and interest (the “Payments”) shall be paid on August 1, 2024 2025, and
each February 1 and August 1 thereafter (each a “Payment Date”) to and including February 1, 2039 2049, in
the amounts and from the sources set forth in Section 3 herein. Payments shall be applied first to accrued
interest, and then to unpaid principal.
Payments are payable by mail to the address of the Owner or such other address as the Owner may
designate upon 30 days’ written notice to the Authority. Payments on this Note are payable in any coin or
currency of the United States of America which, on the Payment Date, is legal tender for the payment of public
and private debts.
2. Interest. Interest at the rate stated above shall accrue on the unpaid principal, commencing on
the Date of Original Issue. Interest shall accrue on a simple basis and will not be added to principal. Interest
shall be computed on the basis of a year of three hundred sixty (360) days and charged for actual days principal
is unpaid.
3. Available Tax Increment. Payments on this Note are payable on each Payment Date in the
amount of and solely payable from Available Tax Increment attributable to the Development Property and paid
to the Authority by the County in the six (6) months preceding the Payment Date. The principal of and interest
on this Note shall be payable each Payment Date solely from Available Tax Increment. No payments will be
made on the Note on any Payment Date if there is an uncured Event of Default under the Agreement.
“Available Tax Increment” means, on each Payment Date, the Tax Increment attributable to the
Development Property and paid to the Authority by the County in the six (6) months preceding the Payment
Date after first deducting therefrom ten percent (10%) of the Tax Increment to be used to reimburse the
Authority for administrative expenses and subject to Section 4.5 hereof. Available Tax Increment shall not
include any Tax Increment if, as of any Payment Date, there is an uncured Event of Default under this
Agreement that has not been waived by the Authority. Once the Event of Default is cured or waived by the
Authority, withheld Tax Increment shall be Available Tax Increment.
The Authority shall have no obligation to pay principal of and interest on this Note on each Payment
Date from any source other than Available Tax Increment, and the failure of the Authority to pay the entire
amount of principal or interest on this Note on any Payment Date shall not constitute a default hereunder as
long as the Authority pays principal and interest hereon to the extent of Available Tax Increment. The
Authority shall have no obligation to pay unpaid balance of principal or accrued interest that may remain after
the payment of Available Tax Increment from the last payment of Tax Increment the Authority is entitled to
receive from the County with respect to the Development Property.
4. Optional Prepayment. The principal sum and all accrued interest payable under this Note is
prepayable in whole or in part at any time by the Authority without premium or penalty. No partial prepayment
shall affect the amount or timing of any other regular payment otherwise required to be made under this Note.
5. Termination. At the Authority’s option, this Note shall terminate and the Authority’s
obligation to make any payments under this Note shall be discharged upon the occurrence of an Event of
Default on the part of the Developer, but only if the Event of Default has not been cured in accordance with
Section 9.2 of the Agreement.
6. Nature of Obligation. This Note is issued to aid in financing certain public development costs
and administrative costs of a Redevelopment Project undertaken by the Authority pursuant to Minnesota
Statutes, Sections 469.001 through 469.047, as amended, and is issued pursuant to an authorizing resolution
(the “Resolution”) duly adopted by the Board of Commissioners of the Authority on June 20, 2023, and
pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including
Minnesota Statutes, Sections 469.174 through 469.1794, as amended. This Note is a limited obligation of the
Authority which is payable solely from Available Tax Increment pledged to the payment hereof under the
Resolution. This Note and the interest hereon shall not be deemed to constitute a general obligation of the State
of Minnesota or any political subdivision thereof, including, without limitation, the Authority. Neither the State
of Minnesota, nor any political subdivision thereof shall be obligated to pay the principal of or interest on this
Note or other costs incident hereto except out of Available Tax Increment, and neither the full faith and credit
nor the taxing power of the State of Minnesota or any political subdivision thereof is pledged to the payment
of the principal of or interest on this Note or other costs incident hereto.
7. Estimated Tax Increment Payments. Any estimates of Tax Increment prepared by the
Authority or its financial or municipal advisors in connection with the TIF District or the Agreement are for
the benefit of the Authority, and are not intended as representations on which the Developer may rely.
THE AUTHORITY MAKES NO REPRESENTATION OR WARRANTY THAT THE
AVAILABLE TAX INCREMENT WILL BE SUFFICIENT TO PAY THE PRINCIPAL OF AND
INTEREST ON THIS NOTE.
8. Registration. This Note is issuable only as a fully registered note without coupons.
9. Transfer. As provided in the Resolution, and subject to certain limitations set forth therein,
this Note is transferable upon the books of the Authority kept for that purpose at the principal office of the City
Clerk of the City of Richfield. Upon surrender for transfer of this TIF Note, including any assignment or
exchange thereof, duly endorsed by the registered owner thereof or accompanied by a written instrument of
transfer, in form reasonably satisfactory to the Executive Director, as registrar (the “Registrar”), duly executed
by the registered owner thereof or by an attorney duly authorized by the registered owner in writing, and the
payment by the Owner of any tax, fee, or governmental charge required to be paid by or to the Authority with
respect to such transfer or exchange, the Registrar shall authenticate and deliver, in the name of the designated
transferee or transferees, a new Note of the same aggregate principal amount, bearing interest at the same rate
and maturing on the same dates.
Notwithstanding the foregoing, this TIF Note shall not be transferred to any person other than an
affiliate, or other related entity, of the Owner unless the Authority has been provided with an investment letter
in a form substantially similar to the investment letter in Exhibit C attached to the Agreement or a certificate of
the transferor, in a form satisfactory to the Executive Director of the Authority, that such transfer is exempt
from registration and prospectus delivery requirements of federal and applicable state securities laws. The
Registrar may close the books for registration of any transfer after the fifteenth day of the month preceding
each Payment Date and until such Payment Date.
The Owner may assign this TIF Note to a lender that provides all or part of the financing for the
acquisition of the Development Property or the construction of the Minimum Improvements. The Authority
hereby consents to such assignment, conditioned upon receipt of an investment letter from such lender in
substantially the form attached to the Agreement as Exhibit C, or other form reasonably acceptable to the
Executive Director of the Authority. The Authority also agrees that future assignments of this TIF Note may
be approved by the Executive Director of the Authority without action of the Board of Commissioners of the
Authority, upon the receipt of an investment letter in substantially the form of Exhibit C of the Agreement or
other investment letter reasonably acceptable to the Authority from such assignees.
This Note is issued pursuant to the Resolution and is entitled to the benefits thereof, which Resolution
is incorporated herein by reference.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions, and things required by the
Constitution and laws of the State of Minnesota to be done, to exist, to happen, and to be performed in order to
make this Note a valid and binding limited obligation of the Authority according to its terms, have been done,
do exist, have happened, and have been performed in due form, time and manner as so required.
IN WITNESS WHEREOF, the Board of Commissioners of the Housing and Redevelopment
Authority in and for the City of Richfield, Minnesota has caused this Note to be executed with the manual
signatures of its Chair and Executive Director, all as of the Date of Original Issue specified above.
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
RICHFIELD, MINNESOTA
Executive Director Chair
REGISTRATION PROVISIONS
The ownership of the unpaid balance of the within Note is registered in the bond register of the
Authority’s Executive Director, in the name of the person last listed below.
Registered Owner Signature of Executive Director
101 E 66th St, LLC
Federal ID #_____________
AMENDED AND RESTATED CONTRACT FOR PRIVATE DEVELOPMENT
between
HOUSING AND REDEVELOPMENT AUTHORITY IN AND
FOR THE CITY OF RICHFIELD, MINNESOTA This document was drafted by: Kennedy & Graven, Chartered (JAE) 150 South Fifth Street, Suite 700 Minneapolis, Minnesota 55402-1299 Telephone: 612-337-9300 and
101 E 66TH ST LLC
Dated 2023 ------June 20
NICOLLET AVE65TH ST E
66TH ST E1ST AVE SSTEVENS AVE65T H S T W
66TH ST W
±I:\GIS\Community Development\Staff\Econ Dev Manager\101 66th St E PLU.mxd
2040 Planned Land Use
Mixed Use
Regional Commercial
Community Commercial
Neighborhood Commercial
High Density Residential
Medium Density Residential
Low Density Residential
Park
Quasi-Public
Right-of-Way (ROW)
101 - 66th St E2040 Comprehensive Plan Designations
0 200 400100ft
AGENDA SECTION:PUBLIC HEARINGS
AGENDA ITEM #3.
S TAFF REPORT NO. 35
HOUSING AND RE DEVELOPMENT AUT HORIT Y
MEET ING
12/18/2023
RE P O RT P RE PA RE D B Y: J ulie Urban, A sst. C ommunity D evelopment D irector
O THE R D E PA RTM E NT RE V IE W:
E X E C UTIV E D IRE C TO R RE V IE W: Melissa P oehlman, E xecutive D irector
6/15/2023
I T E M F O R C O UNC IL C O NS ID E RAT I O N:
Public hearing regarding the sale of 6613-25 Portland Avenue South to Beacon Interfaith Housing
Collaborative, doing business as Aster Commons Limited Partnership and Aster Commons G P LL C.
E X E C UT IV E S UM M ARY:
In June of 2023, the Housing and Redevelopment Authority (H R A) approved a Contract for Private
Redevelopment (Contract) with Beacon Interfaith Housing Collaborative (Beacon), doing business
as Aster Commons Limited Partnership and Aster Commons GP LL C, to develop 38 units of
affordable, supportive rental housing for neuro-diverse young adults on the HRA-owned property
located at 6613-25 Portland Avenue South. Under the terms of the Contract, the H R A agreed to
provide the project a $500,000 grant from the Affordable Housing Trust Fund and to sell the property
to Beacon for $1, contingent upon the H R A holding a public hearing for the sale of land.
The project meets a variety of HRA and City objectives including providing housing affordable at 30% of the
Area Median I ncome (A MI ), housing for people with disabilities, and housing with supportive services. The
project will serve a transit-dependent population, making it an appropriate land use and density for this small,
irregularly-shaped property located adjacent to a transit station.
The Contract requires that the project receive land use approvals; the City Council approved those land use
entitlements on November 28, 2023. The Contract also stipulates that sale of the property will not occur until
the project has received all of its financing. W hile Beacon was unsuccessful getting an award of Low I ncome
Housing Tax Credits (L I HTC) in 2023, they will apply again in 2024. Under the terms of the Preliminary
Redevelopment Agreement, closing must occur on the property by J anuary 31, 2025.
RE C O M M E ND E D AC T I O N:
Conduct and close a public hearing and by motion: Approve the attached resolution authorizing the
sale of 6613-25 Portland Avenue South to Beacon Interfaith Housing Collaborative doing business as
Aster Commons Limited Partnership and Aster Commons G P LL C for the development of 38 units of
affordable, supportive housing.
B AS IS O F RE C O M M E ND AT I O N:
A .H IS TOR IC AL C ON T E X T
T he property is made up of remnant parcels from the Portland Avenue roundabout project.
T he H R A has been seeking a viable development proposal for the site since 2009. T he
property is irregularly-shaped, with a narrow depth, located on a busy arterial roadway
with no on-street parking, located in close proximity to a major intersection, and is
adjacent to a transit station, all of which have made it challenging to find an appropriate
development.
On Tuesday, March 8, 2022, at a joint work session of the C ity C ouncil, HRA , and P lanning
C ommission, B eacon presented conceptual plans for the development of up to 40 units of supportive
rental housing at 6613-25 P ortland Avenue S outh. B eacon specializes in developing supportive housing
at deeply affordable levels throughout the Twin C ities.
On March 21, 2022, the HRA approved a resolution of support for the B eacon concept.
On A pril 18, 2022, the HRA approved a P reliminary Redevelopment A greement with B eacon. On
January 17, 2023, the HRA extended the P reliminary A greement until J anuary 31, 2024.
On J une 20, 2023, the HRA approved a C ontract for P rivate Redevelopment with B eacon agreeing to
sell the property for a dollar, contingent upon a public hearing.
On November 28, 2023, the C ity C ouncil approved land use entitlements for the P roject.
The population to be served would include neuro-diverse youth and young adults, and supportive
housing services would be provided on-site. Twenty units will be affordable at 30% of the A MI, with rent
assistance provided by Hennepin C ounty, and the remaining units will be affordable at 50% of the A M I.
B eacon continues to seek sources of funding to be able to provide all units affordable at 30% of the
A M I.
B .E QU ITAB L E OR S T R AT E GIC C ON S ID E R AT ION S OR IMPAC T S
The project furthers the C ity's S trategic P riority of C ommunity D evelopment by helping to maintain
Richfield as an affordable place to live and increase the tax base of the currently tax-exempt property.
The project also advances equity by providing housing designed specifically to meet the currently unmet
needs of neuro-diverse young adults for accessible, supportive and affordable housing.
C .P OL IC IE S (resolutions, ordinances, regulations, statutes, exc):
The 2040 C omprehensive P lan calls for a full range of housing choices that meets residents' needs at
every stage of their lives and ensures a healthy balance of housing types that meet the needs of a
diverse population with diverse needs.
The C ity of Richfield and its HRA have a long history of partnering with organizations that best serve its
residents. S upporting housing stability for people with the lowest incomes is a way to further the
community's commitment to equitable opportunities for all.
The Metropolitan C ouncil has identified the C ity's share of housing affordable at 30% of the A M I to be
66 units by 2030.
The P roject exceeds the requirements of the Inclusionary Housing P olicy, which requires that either 20%
of the units be affordable at 60% of the A M I, 15% at 50% A M I, or 10% at 30% A M I and that 5% of units
be Type A with roll-in showers or 3% be fully accessible.
The P roject meets several priorities of the A HTF, including:
Housing with units affordable at 30% of the A MI
Housing with accessible units
Housing with supportive services
Housing with resident rental subsidies
D .C R IT IC AL T IMIN G IS S U E S:
Under the terms of the C ontract, closing on the property would occur by J anuary 31, 2025, construction
would begin by J uly 31, 2025, and construction would be completed by S eptember 30, 2026.
Once final approval is granted for the land sale, the project will be more competitive for funding
opportunities.
E .F IN AN C IAL IMPAC T:
Under the A greement, the HRA would sell the property to B eacon for one dollar. There was no cost to
the HRA for the property.
The HRA 's financial consultant reviewed the request for a land write-down and a grant from the
A ffordable Housing Trust F und and determined that the project needs the requested funds and land
write-down in order to be economically viable.
F.L E GAL C ON S ID E R AT ION:
Notice of the public hearing was published in the S un C urrent on D ecember 7, 2023.
S ection 469.029 of the HRA A ct requires the HRA to conduct a public hearing and approve the sale of
any HRA -owned property.
ALTE R N AT IV E R E C O MME N D ATIO N(S):
Do not approve the sale of land.
P R IN C IPAL PAR TIE S E X P E C TE D AT ME E TIN G:
Representative from Beacon I nterfaith Housing Collaborative
AT TAC H ME N T S:
D escription Type
Resolution Resolution L etter
A ster C ommons rendering and site plan B ackup Material
C ontext Map B ackup Material
HRA RESOLUTION NO.
RESOLUTION APPROVING A THE SALE OF 6613-25 PORTLAND AVE
SOUTH TO ASTER COMMONS LIMITED PARTNERSHIP
AND ASTER COMMONS GP LLC
WHEREAS, the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota (the "Authority'') was created pursuant to Minnesota Statutes,
Sections 469.001 through 469.047, as amended, and was authorized to transact
business and exercise its powers by a resolution of the City Council of the City of
Richfield, Minnesota (the "City''); and
WHEREAS, the HRA desires to develop certain real property pursuant to and
in furtherance of the City’s housing and redevelopment goals, said real property
located at 6613-25 Portland Avenue South (the “Redevelopment Property”), legally
being described as:
Lots 31, 32, 33, and 34, Auditor’s Subdivision No. 340, Hennepin County,
Minnesota
WHEREAS, Aster Commons GP LLC, a Minnesota limited liability company
(the "Redeveloper"), has proposed to acquire the Redevelopment Property from
the Authority and to transfer the Redevelopment Property to Aster Commons
Limited Partnership, a Minnesota limited partnership (the "Partnership");
WHEREAS, the Partnership has proposed to construct on the
Redevelopment Property a multifamily housing project consisting of approximately
38 supportive housing units (the "Minimum Improvements") and a Contract for
Private Redevelopment was approved on June 20, 2023; and
WHEREAS, to make the Minimum Improvements economically feasible for
the Partnership to construct, the Authority has proposed to sell the Redevelopment
Property for the reduced price of $1.00, following a public hearing; and
WHEREAS, as required by Minnesota Statutes Section 429.029, the HRA
conducted a public hearing on the sale of the Redevelopment Property to the
Partnership on December 18, 2023, following proper notice; and
NOW, THEREFORE, BE IT RESOLVED, by the Board of Commissioners
of the Housing and Redevelopment Authority in and for the City of Richfield,
Minnesota as follows:
1. A public hearing has been held and the Redevelopment Property is authorized
to be sold for $1.00 to Aster Commons GP LLC and transferred to Aster
Commons Limited Partnership.
2. The Chair and the Executive Director are hereby authorized to execute and
deliver any and all documents deemed necessary to carry out the
intentions of this resolution and the land sale.
Adopted by the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota this ______ day of ______________, 2023.
__________________________________
Gordon Hanson, Acting Chair
ATTEST:
______________________________
Sean Hayford Oleary, Secretary
M gnSRiseD
15’
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I:\GIS\Community Development\Case Maps\2023\Aster Commons GLM.mxd
6613-6625 Portland Avenue South
Beacon Interfaith Housing - Aster Commons
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