111510completeagendaCITY OF RICHFIELD, MINNESOTA
MONDAY, NOVEMBER 15, 2010
REGULAR HOUSING AND REDEVELOPMENT AUTHORITY MEETING
RICHFIELD CITY HALL COUNCIL CHAMBERS
6700 PORTLAND AVENUE
7:00 P.M.
AGENDA
Call to order
Oath of Office to HRA Commissioner Debbie Goettel
Roll call
1. Approval of minutes of Regular HRA Meeting of October 18, 2010
2. HRA approval of agenda
3. Public hearing regarding resolution granting nonexclusive easement for access
purposes to Meridian Crossings (south of 77th Street) over portion of Emerson
Avenue owned by Richfield HRA
Staff Report No. 38
Notes:
4. Consideration of request for subordination of HRA transformation home ioan at
6945-14th Avenue
Staff Report No. 39
Notes:
5. Consideration or resolution authorizing execution of amended and restated tax
increment pledge agreement with City of Richfield relating to City's Penn Avenue
bridge bonds
Staff Report No. 40
Notes:
6. Consideration of guidelines for Richfield Rediscovered Lot Sale Program
Staff Report No. 41
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.
richfield: November 2010
Page 1 of 1
I!`tBii{it~r' ~'il~~ss~T' ~~'ectzfle~ct~y ~~311I'~Cc`I~' 'Plf~'
1 f1`6' 2 5 '~° ~
GENERAL ELECTION 7 PM Transportation 7 PM Arts Commission
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J
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING MINUTES
Richfield, Minnesota
Regular Meeting
October 18, 2010
CALL TO ORDER
The meeting was called to order by Chair Sandahl at 7:05 p.m.
ROLL CALL
HRA Members
Present: Sue Sandahl, Chair; David Gepner, Joan Helmberger (arrived at 7:06
p.m.), Doris Rubenstein; and Steven Quam.
Staff Present: John Stark, Community Development Director; Karen Barton, Assistant
Community Development Director; and Nancy Gibbs, City Clerk.
Item #1 HRA APPROVAL OF MINUTES
M/Gepner, S/Quam to approve the minutes of (1) Regular HRA Meeting of September 20,
2010 and (2) Special HRA Meeting of September 22, 2010.
Motion carried 4-0.
Item #2 HRA APPROVAL OF AGENDA
M/Rubenstein, S/Gepner to approve the agenda.
otion carried 4-0.
HRA Meeting -2- October 18, 2010
Item #3 CONSIDERATION OF PROPERTY MANAGEMENT AGREEMENT WITH 33RD
COMPANY, INC. FOR MANAGEMENT OF HRA-OWNED RESIDENTIAL
RENTAL PROPERTIES. S.R. NO. 35
Commission Member Helmberger arrived at 7:06 p.m.
Assistant Community Development Director Barton presented Staff Report No. 35.
Commissioner Rubenstein asked if there was a competitive process to hire this company.
Assistant Community Development Director Barton stated that a number of property
management companies were interviewed and it was determined that 33rd Company met the needs
the city was looking for.
M/Sandahl, S/Helmberger approved a Property Management Agreement with 33rd
Company Inc. for the management of residential rental properties.
Motion carried 5-0.
Item #4 DISCUSSION OF PRELIMINARY PROPOSALS FOR REDEVELOPMENT OF
2517 WEST 76T" STREET S.R. NO. 36
Assistant Community Development Director Barton presented Staff Report No. 36.
Beth Pfifen, Director of Development and Colleen Carey, President of The Cornerstone
Group, presented a preliminary proposal for the development of 8 townhomes.
Dan Billmark, Director of Real Estate for Assessable Space Inc. (ASI) presented their
preliminary proposal fora 10 unit apartment building for tenants with disabilities.
Ron Korsch of Greater Metropolitan Housing Corporation a presented preliminary proposal
of 8 single family small affordable houses that form an association.
Commission members unanimously agreed that Cornerstone and Greater Metropolitan
Housing Corporation were their top choices.
Item #5 CONSIDERATION OF RESOLUTION AUTHORIZING PURCHASE OF REAL
PROPERTY LOCATED AT 2517 WEST 76T" STREET UTILIZING COMMUNITY
DEVELOPMENT BLOCK GRANT FUNDS CONTINGENT UPON FINDING OF
CONSISTENCY BY PLANNING COMMISSION. S.R. NO. 37
Assistant Community Development Director Barton presented Staff Report No. 37.
Commissioners directed staff to bring the item to the City Council for policy making decision.
MlRubenstein, S/Gepner that the following resolution be adopted authorizing the purchase
of real property utilizing Community Development Block Grant Funds and that it be made a part of
these minutes:
HRA RESOLUTION NO. 1081
HRA Meeting -3- October 18, 2010
RESOLUTION AUTHORIZING PURCHASE OF REAL PROPERTY
LOCATED AT 2517 West 76t" Street
Motion carried 5-0. This resolution appears as HRA Resolution No. 1081.
Item #7 CLAIMS AND PAYROLL
M/Gepner, S/Quam that the following claims and payrolls be approved:
U.S. Bank 10/18/2010
Section 8 Checks: 119577-119700
HRA Checks: 31013-31037
TOTAL
Motion carried 5-0.
ADJOURNMENT
The meeting was adjourned by unanimous consent at 8:22 p.m.
Date Approved:
$ 152,697.80
$ 136,753.04
$289,450.84
Suzanne M.Sandahl
Chair
Nancy Gibbs
City Clerk
Steven L. Devich
Executive Director
AGENDA ITEM #
REPORT #
~i
STAFF REPORT
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING
NOVEMBER 15, 2010
REPORT PREPARED BY:
REPORT PRESENTER:
DEPARTMENT DIRECTOR REVIEW:
REVIEWED BY EXECUTIVE DIRECTOR:
CHRISTINE COSTELLO, COMMUNITY
DEVELOPMENT SPECIALIST
NAMF'. T/7Lli
JOHN STARK, COMMUNITY DEVELOPMENT
DIRECTOR
ITEM FOR HRA CONSIDERATION:
Public hearing regarding the consideration of a resolution granting a nonexclusive easement
for access purposes to Meridian Crossings (south of 77th Street) over a portion of Emerson
Avenue owned by the Richfield Housing and Redevelopment Authority.
I. RECOMMENDED ACTION:
By Motion: Approve the attached resolution granting a nonexclusive
easement for access purposes to Meridian Crossings (south of 77th
Street) over a portion of Emerson Avenue owned by the Richfield
Housina and Redevelopment Authority.
II. BACKGROUND
The Meridian Crossings office complex is located at the intersection of Interstates
494 and 35W. On October 1, 2010 Meridian Crossings, LLC (Meridian), purchased
the two-building office complex. As part of the purchase, Meridian was concerned
about a portion of Emerson Avenue that is currently used as the ingress and egress
point for the complex. The Richfield Housing and Redevelopment Authority (HRA)
is currently the fee title holder for that part of Emerson Avenue that is used for
ingress and egress into the office complex. Meridian is concerned that if Emerson
Avenue should ever be vacated that they might lose access to the office complex.
111510-Nonexclusive Easement Meridian Crossings.doc
In response to Meridian's concern, the HRA attorney and staff recommended a
nonexclusive easement with Meridian for ingress and egress to the office complex.
As part of the proposed nonexclusive easement agreement with Meridian the area
is subordinate to the right of the public to use and gives Meridian no rights in the
easement area beyond the right to use the easement area for ingress and egress,
for so long as that area remains dedicated roadway. The easement area is also
subject to utilities in the easement area, this will allow the City the right to maintain,
repair, service, and replace any utilities as needed. Additionally, Meridian can not
damage or excavate the easement area without prior approval from the City.
On October 25th the Planning Commission approved a finding of consistency that
the nonexclusive easement for ingress and egress purposes to Meridian Crossings
over a portion of Emerson Avenue (south of 77th Street) is consistent with the 2008-
2018 Richfield Comprehensive Plan.
III. BASIS OF RECOMMENDATION
A. POLICY
• eri ian rossings is current y zoned PC-2 (Planned General
Commercial).
• The 2008-2018 Comprehensive Plan identifies the area as office.
• On October 25th the Planning Commission approved a finding of
consistency that the nonexclusive easement for ingress and egress
purposes to Meridian Crossings over a portion of Emerson Avenue (south
of 77th Street) is consistent with the 2008-2018 Richfield Comprehensive
Plan. The vote was 8 to 0.
B. CRITICAL TIMING ISSUES
• ranting t e nonexc usive easement will not impede the City and HRA
from access to the publicly dedicated roadway or access to utilities in the
easement area for maintenance, repair, or service.
• As long as the easement area remains a publically dedicated roadway,
Meridian can not damage, excavate or disturb the roadway without prior
approval from the City.
C. FINANCIAL
• eri ian rossings, . is paying or surveying, legal, and staff time.
D. LEGAL
• ega counse ra e t e nonexclusive easement document and
resolution in cooperation with staff and Meridian Crossings LLC.
TERNATIVE KECOMMENDATION(S) ~
pprove t e nonexc usive easement or ingress and egress purposes to
Meridian Crossings over a portion of Emerson Avenue (south of 77th Street)
with added provisions or modifications.
Do not approve the nonexclusive easement for ingress and egress purposes
to Meridian Crossings over a portion of Emerson Avenue (south of 77th
Street).
V. ATTACHMENTS
• eso ution
• Grant of Easement Document
• Map showing easement area
VI. PRINCIPAL PARTIES EXPECTED AT MEETING
3-1
HRA RESOLUTION NO.
RESOLUTION AUTHORIZING GRANTING OF AN EASEMENT
OVER AND ACROSS REAL PROPERTY LOCATED WITHIN
THE INTERSTATE-LYNDALE-NICOLLET (ILN) TAX INCREMENT DISTRICT
WHEREAS, The Housing and Redevelopment Authority (HRA) is the owner of a
parcel and tract of land described in the attached Exhibit A the HRA Parcel; and
WHEREAS, the HRA Parce( lies entirely within the right-of-way of Emerson Avenue
South, a dedicated public road; and
WHEREAS, a portion of said roadway serves as a primary access to the parcels of
land located to the west and generally known as Meridian Crossings; and
WHEREAS, Meridian Crossings was developed pursuant to the Redevelopment
Plan for the ILN Tax Increment District; and
WHEREAS, the owner of Meridian Crossings have requested that the HRA grant it
anon-exclusive access easement over the portion of the HRA Parcel which serves as
access to Meridian Crossings; and
WHEREAS, in accordance with the requirements of state law, the HRA has held a
public hearing on the request following proper notice; and
WHEREAS, the HRA has received public comments and the recommendation of
staff regarding the request;
NOW THEREFORE, BE IT RESOLVED by the Housing and Redevelopment
Authority in and for the City of Richfield, Minnesota as follows:
1. The grant of a nonexclusive easement in substantially the form of the attached
Exhibit B is hereby approved.
2. The Board Chair and Executive Director are authorized to execute and deliver
the easement on behalf of the HRA, and to take such other actions as may be
reasonably necessary accomplish such direction.
3. Because it is substantially unlikely that the involved portion of Emerson Avenue
will ever be vacated, because of the nonexclusivity of the easement, because of
the location of utilities within the easement area, and because the property will
continue to be owned by the HRA, the HRA deems the fair market of the
easement to be $1.00.
4. The execution and delivery of the easement is conditioned upon the payment by
requester of the HRA's costs and expenses incurred in connection with this
matter. Execution and delivery will be deemed as conclusive evidence of the
satisfaction of this requirement.
Adopted by the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota this 15th day of November, 2010.
Suzanne M. Sandahl, Chair
ATTEST:
Joan Helmberger, Secretary
111510-Nonexclusive Easement Meridian Crossings.doc
3-2
Exhibit A
An easement over and across that part of the east 30.00 feet of the West Half of the
Northeast Quarter of the Southwest Quarter of the Southeast Quarter of Section 33,
Township 28, Range 24, also known as Emerson Avenue South, described as beginning
at the northeast corner of Lot 3, Block 3, CLOVERLEAF ADDITION, according to the
recorded plat thereof, Hennepin County, Minnesota, thence on an assumed bearing of
South 0 degrees 07 minutes 35 seconds West, along the east line of said Lot 3, a distance
of 65.54 feet; thence North 50 degrees 20 minutes 29 seconds East a distance of 39.04
feet to the east line of said West Half of the Northeast Quarter of the Southwest Quarter of
the Southeast Quarter of Section 33; thence North 0 degrees 07 minutes 35 seconds East,
along said east line of the West Half of the Northeast Quarter of the Southwest Quarter of
the Southeast Quarter of Section 33, a distance of 8.90 feet to the southeasterly extension
of.the northeast line of said Lot 3; thence northwesterly a distance of 43.63 feet, along said
southeasterly extension of the northeast line of Lot 3, being anon-tangential curve
concave to the northeast, having a radius of 610.33 feet and a central angle of 4 degrees
05 minutes 44 seconds, to the point of beginning.
3-3
Exhibit B
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PROpO5FT1 EASEMENT IIESCRIPTIC3N
An easement over and across that
part of the east 30.DD feet of the
,Vest H^If of the Northeast t?uarter
of the Southwest Quarter of the
Southeast Quarter of Section 33,
Township 28, Range 24, also known
as Emerson Avenue South, described
as beglnning at the northeast comer
of Lot 3, Block 3, GLOVERLEAF
ADDITIOIJ, according to the recorded
plat thereof, Hennepin County,
Minnesota, thence an an assumed
beorin9 of South 0 degrees 07
minutes 35 seconds West, along the
east line of said Lot 3, a distance of
65.54 feet; thence Narth 50 degrees
20 minutes 29 seconds Eask a
distance of 39.04 feet to the east
line of said West H^If of the
Northeast Ruorter of khe Southwest
Quarter of the Southeast Quarter of
Section 33; thence North 0 degrees
Q7 minutes 35 seconds East, along
said east line of the West Half of
the Northeast Quarter of the
Southwest Quorter of the Southeast
Quorter of Section 33, a distance of
B,9D feet to the southeasterly
extenslon of the northeast Ilne of
said Lat 3; thence northn~esterly a
distance of 43.63 feet, along said
southeasterly extenslon of the
northeast line of Lot 3, being o
rlon-tangential curve concave to the
northeast, having ^ radius of 610.33
feet and ^ central angle of 4
degrees 175 minutes 44 seconds, to
the paint of beglnning.
I hereby certify that this sketch, plan, or report was
prepared by me or under my direct supervision and
that I am ^ duly Licensed Land Surveyor under the
laws of the State of A4innesota.
Dated this 7th day of October, 2010
SONDE LP,ND SUR~VEY/I~NG,~~LLC.
Leonard F. Garison, P.L.S. Minn. Lic. hJv. 44890
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GRANT OF EASEMENT
THIS GRANT OF EASEMENT (the "Grant") is made by ,the Housing and
Redevelopment Authority in and for the City of Richfield, a Minnesota public body corporate
and politic, (the "Grantor").
RECITALS
Whereas, Grantor is the owner of certain real property located in the City of Richfield,
County of Hennepin, State of Minnesota legally described in Exhibit A attached hereto and made
a part hereof (the ``Grantor's Property"); and
Whereas, the Grantor's Property is subject to a public roadway known as Emerson
Avenue; and
Whereas, Meridian Crossings, LLC, a Delaware limited liability company (the
``Grantee") is the owner of that tract of land legally described in Exhibit B attached hereto and
made a part hereof (the "Grantee's Property"); and
Whereas, access to the Grantee's property as well as to other parcels, is obtained over and
across a portion of Emerson Avenue located on Grantor's Property; and
Whereas, Grantee is concerned that, should Emerson Avenue ever be vacated, it might
lose access to Grantee's Property; and
Whereas, Grantor understands Grantee's concern, and is willing to provide Grantee with
a nonexclusive easement as hereinafter provided.
Now Therefore, Grantor hereby grants to Grantee, its successors and assigns, a
permanent non exclusive easement for vehicular and pedestrian ingress and egress to Grantee's
Property over and across the portion of the Grantor's Property described and depicted in Exhibit
37626w4 JBD RC125-312
1
3-S
C attached hereto and made a part hereof (the "Easement Area"), subject, however, to the
following conditions:
1. The Easement is, in all respects subordinate to the rights: (i) of the public to use
Emerson Avenue throughout the Easement Area; (ii) of the City to repair,
maintain, reconstruct or replace Emerson Avenue throughout the Easement Area,
and gives the Grantee no rights in the Easement Area (beyond the right to use the
public roadway) for so long as the portion of Emerson Avenue in the Easement
Area remains a publically dedicated roadway.
2. The Easement is in all respects subject to any utilities currently located in the
Easement Area, including the right to maintain, repair, service and replace such
utilities.
3. For so long as Emerson Avenue remains a publically dedicated roadway, Grantee
may not, without proper approval of the City of Richfield, damage, excavate or
disturb the roadway, or do anything that would interfere with the public right to
use Emerson Avenue.
4. Grantor may grant further nonexclusive easements for ingress and egress over and
across the Easement Area to others who utilize the Grantor's Property for ingress
or egress purposes. Any such grants will be subject to all of the same conditions
as are contained herein.
5. Grantor may also, in its sole discretion, grant easements, permits or licenses for
the location of additional utilities in the Easement Area, as long as such rights do
not unreasonably interfere with the Easement; routine maintenance, repair and
replacement of such utilities excepted.
6. If Emerson Avenue in the Easement Area ceases to be a publicly dedicated
roadway, the easement rights granted to Grantee hereby include the right to repair
and replace the roadway improvements existing in the Easement Area. Provided,
however, that such repair and replacement activities shall be only temporary, and
shall not unreasonably interfere with use of the Easement Area by the holders of
other easements or licenses covering the Easement Area.
IN WITNESS WHEREOF, the Grantor has made and executed this Grant of Easement
effective the date first above written.
Affix Deed Tax Stamp Here
HOUSING AND REDEVELOPMENT A UTHORITY
IN AND FOR THE CITY OF RICHFIELD
By:
Its: Chairperson
376265v4 JBD RC125-312
2
3- ~
By:
Its: Executive Director
STATE OF MINNESOTA )
ss.
COUNTY OF HENNEPIN )
The foregoing was acknowledged before me this day of , 201_, by
Suzanne M. Sandahl, the Chairperson of the Housing and Redevelopment Authority in and for
the City of Richfield, a public body corporate and politic under the laws of Minnesota, on behalf
of the corporation, Grantor.
SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT
376265v4 JBD RC125-312
3
3-~
STATE OF MINNESOTA )
ss.
COUNTY OF HENNEPIN )
The foregoing was acknowledged before me this day of , 201_,
by Steven L. Devich, the Executive Director, of Housing and Redevelopment Authority in and
for the City of Richfield, a public body corporate and politic under the laws of the State of
Minnesota, on behalf of the corporation, Grantor.
SIGNATURE OF PERSON TAKING ACKNOWLEDGMENT
This instrument drafted by:
Kennedy & Graven, Chartered (JBD)
470 U.S. Bank Plaza
200 South Sixth Street
Minneapolis, MN 55402
(612) 337-9300
376265v4 ,iBD RC125-312
4
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EXHIBIT A
LEGAL DESCRIPTION OF GRANTOR'S PROPERTY
That part of the West 30 feet of Emerson Avenue South as dedicated in the plat of Cloverleaf
Addition which lies North of the North line of the plat of The Shoppes at Lyndale, which lies
East of and adjoining Lot 3, Block 3, Cloverleaf Addition and which lies southerly of the
southeasterly extension of the southwesterly line of 77th Street West.
Error! L nknown document property name.
A-1
3-q
EXHIBIT B
LEGAL DESCRIPTION OF GRANTEE'S PROPERTY
Parcel 1:
Lot 2, Block 3, Cloverleaf Addition, according to the recorded plat thereof, and situate in
Hennepin County, Minnesota, together with the appurtenant easements contained in that certain
Declaration of Covenants, Conditions, Restrictions and Maintenance for a Private Road dated
Apri125, 1997, filed July 21, 1997, as Document No. 6760439 and together with the appurtenant
easements contained in that certain Link Agreement dated August 10, 1998, filed August 27,
1998, as Document No. 6957716.
Parcel 2:
Lot 3, Block 3, Cloverleaf Addition, according to the recorded plat thereof, and situate in
Hennepin County, Minnesota, together with the appurtenant easements contained in that certain
Link Agreement dated August 10, 1998, filed August 27, 1998, as Document No. 6957716 and
together with the appurtenant easements contained in that certain Utility, Access and Signage
Easement Agreement dated March 19, 1998, filed October 26, 1999, as Document No. 7204660.
Crror! lnknown document property name.
B-1
3- (~
EXHIBIT C
EASEMENT AREA DESCRIPTION AND DEPICTION
~'¢se~ze~t Sketch FoT•
CfTY OF RICHFIELD
\ EASEMENT DESCRIPTION
~ An easement over and across that
part of the east 30.OD feet of the
G,
~ry
~ West Half of the Northeast Quarter
~ of the Southwest Quarter of the
Southeast Quarter of Section 33,
~ Township 28, Range 24, also known
P
"
~ os Eme-son Avenue South, described
'
os beginning of the northeast corner
- ~
~ - of Lot 3, 13iock 3, CLOVERLLAF
NE UNE OF LOT 3,
ADDITION, ocwrding to the recorded
~
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- nV Minnesota, thence on on assumed
_ _ p'~, bearing of South 0 degrees 67
= ~P~r. minutes 35 seconds West, along the
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CAST UNE Cf THE W I/Z Sect'wn 33; thence Nor{h D degrees
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i hereby certify that this sketch, plan, or report was
prepared by me or under my direct supervision and
~ that I am a duly Licensed Land Surveyor under the
laws of the Stdtd of Minnesota.
g
.1 odted this 7th day of oataber, 2alo
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SUNDE LAND SURVE
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J STAFF REPORT
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING
NOVEMBER 15, 2010
REPORT PREPARED BY:
JULIE URBAN/MICHELLE LEWIS, HOUSING
SPECIALIST
.~%Anac. T%i7,E
REPORT PRESENTER:
KAREN BARYON, COMMUNITY
DEVELOPMENT ASSISTANT DIRECTOR
DEPARTMENT DIRECTOR REVIEW:
REVIEWED BY EXECUTIVE DIRECTOR:
ITEM FOR IAA CONSIDERATION:
Consideration of a request for a subordination of a Housing and Redevelopment Authority
Transformation Home loan at 6945 14th Avenue.
I. RECOMMENDED ACTION:
By Motion: Approve or deny the request for a subordination of a
Housing and Redevelopment Authority Transformation Home loan at
6945 14th Avenue.
II. BACKGROUND
Theodore and Sarah Fletcher of 6945 14th Avenue have requested a subordination
of a $15,000 Transformation Home loan received on April 5, 2006. At 107 percent,
the combined loan-to-value ratio exceeds the Housing and Redevelopment
Authority's (HRA) Subordination and Satisfaction Policy limit of 80 percent and is
therefore being brought to the HRA for consideration.
The HRA's Transformation Home loan is currently in second position behind the
primary mortgage with a current balance of $227,000, with a current combined loan-
to-value ratio of 105 percent. The Fletchers would like to refinance the superior
mortgage into a new mortgage of $232,500.00, the total balance of their current
mortgage, closing costs, and prepaid items for a combined loan-to-value ration of
108 percent. The amount of debt in front of the HRA's lien will increase by $5,500
11152010 Fletcher subordination request appeal.doc
(2%). The interest rate will be reduced from 6 3/4 percent to 5 percent, resulting in
a savings of $303.90 per month in interest charges.
When the Fletchers took out the Transformation Home Loan in 2006, their home
appraised at $300,000 and their combined loan-to-value ratio was 85 percent. The
current appraised value of their home is $230,000, resulting in a higher combined
loan-to-value ratio of 107 percent. The Fletchers Transformation Home project was
valued at $105,800. They have also finished the basement in addition to the
Transformation project.
The refinance the Fletchers seek reduces the interest rate and reduces the
Fletcher's monthly payments. However, the combined loan-to-value ratio is above
the HRA's Subordination and Satisfaction Policy limit of 80% (85% under
administrative appeal guidelines). Although the superior debt to the HRA's lien is
increasing, it is still within the 50% increase permitted under the Subordination and
Satisfaction Policy guidelines. The Fletcher's request meets all other requirements
of the guidelines: property taxes are current, no equity is being removed, closing
costs are 1.51 percent, payment terms are within financial means of the Fletchers,
and no other subordinations have been granted in the past 5 years.
III. BASIS OF RECOMMENDATION
A. POLICY
According to the HRA Subordination and Satisfaction Policy:
• The total debt secured by the property, including the HRA lien and all
superior mortgages, shall not exceed 80 percent of the documented
market value of the property. Astaff-authorized administrative appeal
of the Policy can be granted if the loan-to-value ratio does not exceed
85 percent and all other requirements of the Policy are met.
• The overall value of superior debt must not be increased by more than
50%.
• Closing costs do not exceed three percent (currently at 1.51 percent).
• Payment terms are within the financial means of the borrower.
• Equity being removed must be no more than $5000 or must be for
qualified home improvements.
• Property taxes must be current.
• No subordinations have been granted to the loan within the past 5
years.
B. CRITICAL ISSUES
• The combined loan-to-value ratio is 108 percent.
• The amount of debt in front of the HRA lien increases 2% from
$227,000 to $232,500.
• The property's value has decreased from $300,000 to $230,000 since
2006 and is the reason for the increased combined loan-to-value ratio.
The refinancing will lower the primary loan's interest rate and will
reduce the amount of the Fletcher's monthly payments.
C. FINANCIAL
• The amount of debt in front of the HRA lien is increased $5,500 or 2%.
• The application fee has been received for the subordination request.
D. LEGAL
• N/A
IV. ALTERNATIVE RECOMMENDATION~S~
• Approve the subordination request.
• Approve the subordination request with financial counseling as a contingency
of the approval.
• Deny the subordination request.
V. ATTACHMENTS
• Photograph of 6945 14th Avenue South
• Letter from homeowner
VI. PRINCIPAL PARTIES EXPECTED AT MEETING
• Theodore and Sarah Fletcher
y, - t
6945 14t" Avenue South
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From: Ted Fletcher [mailto:fletchert70@yahoo.com]
Sent: Thursday, November 04, 2010 9:18 PM
To: Michelle Lewis
Subject: Subordination appeal
City of Richfield,
In efforts to proceed with the refinance of our home mortgage, we request to appeal the
housing loan we have with the City of Richfield for our residence of 6945 14th Avenue
South.
For the past 10 years we have made major improvements to this location without taking
out any amount of equity.
As of now we are prevented from lowering our interest rate due to our LTV that does not
meet the 80% requirements from the city to subordinate the loan.
In 2006, our house was appraised at $300,000 and now is currently appraised at
$233,000. This is due to the downfall in the housing market not due to us taking out equity.
Please take our case into consideration and let us know if there is any further paperwork
that may be needed. We appreciate your time and attention to help us complete this
process.
Thank you,
Ted & Sarah Fletcher
Phone: 612-718-3545
AGENDA ITEM # 5
REPORT # 4n
STAFF REPORT
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING
NOVEMBER 15, 2010
REPORT PREPARED BY:
REPORT PRESENTER:
DEPARTMENT DIRECTOR REVIEW:
REVIEWED BY EXECUTIVE DIRECTOR:
JOHN STARK, COMMUNITY DEVELOPMENT
DIRECTOR
NaMt~, Tllic
JOHN STARK, COMMUNITY DEVELOPMENT
DIRECTOR
ITEM FOR HRA CONSIDERATION:
Consideration of a Resolution authorizing execution of an Amended and Restated Tax
Increment Pledge Agreement with the City of Richfield relating to the City's Penn Avenue
Bridge Bonds.
RECOMMENDED ACTION:
By Motion: Adopt a Resolution authorizing execution of an Amended
and Restated Tax Increment Pledge Agreement with the City of
Richfield relating to the City's General Obligation Tax Increment
Refunding Bonds, Series 2010B, in the approximate aggregate
rincipal amount of $6,465,000.
II. BACKGROUND
In 2001 the City issued the $8,350,000 General Obligation (GO) Tax Increment
Bonds, Series 2001A for the purpose of financing the construction of the Penn
Avenue Bridge associated with the Best Buy Development. The Richfield Housing
and Redevelopment Authority (HRA), however, is the body which possesses
administrative control over tax increment funds. As such, the HRA adopted a
resolution in 2001 pledging sufficient tax increment financing (TIF) to meet the debt
service of those City-issued bonds.
111510 bridge bond refinancing
City and HRA staff, along with public financial advisors Ehlers & Associates, Inc.,
conduct an annual review of outstanding bonds to determine whether a refinancing
of those bonds would be a financially prudent action. With interest rates at historical
lows, it has been determined that a refinancing of the Penn Avenue Bridge bonds is
warranted.
Under current municipal bond interest rates, it is estimated that this refinancing
would reduce the principle and interest costs of paying this debt by approximately
$1,017,750 (which equates to an annual savings of approximately $78,000).
Under the terms of the existing Development Agreement between Best Buy and the
HRA, any TIF funds that exceeded the bridge bond debt service and a capped
payment to the HRA for reimbursement of administrative costs and payment into the
Housing and Redevelopment Fund would be provided to Best Buy. Best Buy has
generously offered, however, to amend the Development Agreement in a way that
allows 100% of the savings resulting from this bond refinance to go into the Housing
and Redevelopment Fund.
The action currently being considered is one of several steps necessary to
refinance the bonds (see attached schedule). The City Council was scheduled to
adopt a resolution authorizing the sale of the bonds at their November 9 meeting
and to award the bond sale at their December 14 meeting. At the December 20
HRA Meeting, an Amendment to the Development Agreement with Best Buy is
being contemplated; this amendment would revise the amount of TIF that the HRA
could capture as part of the Housing and Redevelopment Fund. The budgeting of
the use of these funds would be brought back for HRA consideration in 2011.
III. BASIS OF RECOMMENDATION
A. POLICY
• City/HRA Staff and the HRA's financial consultants (Ehlers &
Associates) have concluded that an action by the City of Richfield to
refinance the Penn Avenue Bridge Bonds GO TIF Bonds Series
2001A would result in significant savings due to favorable interest
rates.
These bonds (both the original and the refinancing bonds) are
serviced by TIF.
The HRA is the body cha"rged with the administration of TIF and, as
such, must take action to re-pledge the TIF to the City for the
refinanced bonds.
B. CRITICAL TIMING ISSUES
• The sale of the refunding bonds at this time will allow the City to take
advantage of the low interest rates and realize savings. Any delay
could result in a sale date during the holiday season, when bond sales
typically have fewer bidders and/or in an increase in bond interest
rates.
C. FINANCIAL
• Under current municipal bond interest rates, it is estimated that this
refinancing would reduce the principle and interest costs of paying this
debt by approximately $1,017,750 (which equates to an annual
savings of approximately $78,000).
• These savings are anticipated to become additional funding for the
HRA's Housing and Redevelopment Fund (subject to an amended
development agreement with Best Buy); the use of which will be
determined in the HRA's budgeting process.
D. LEGAL
• City/HRA legal staff have been party to all of the discussions
regarding the bond refinance and drafted the attached resolution.
IV. ALTERNATIVE RECOMMENDATION(S~
• Do not adopt the recommended Pledge Agreement which would result in the
bonds continuing to be serviced as presently scheduled and which would
forego the projected savings.
V. ATTACHMENTS
• A Resolution authorizing execution of an Amended and Restated Tax
Increment Pledge Agreement with the City of Richfield relating to the city's
GO Tax Increment Refunding Bonds, Series 2010B, in the approximate
aggregate principal amount of $6,465,000.
• A tentative schedule of events for the bond refinancing.
VI. PRINCIPAL PARTIES EXPECTED AT MEETING
• N/A
s-~
RESOLUTION NO.
RESOLUTION AUTHORIZING EXECUTION OF AN
AMENDED AND RESTATED TAX INCREMENT PLEDGE
AGREEMENT WITH THE CITY OF RICHFIELD RELATING
TO THE CITY'S GENERAL OBLIGATION TAX INCREMENT
REFUNDING BONDS, SERIES 20106, IN THE
APPROXIMATE AGGREGATE PRINCIPAL AMOUNT OF
$6,465,000
WHEREAS, the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota (the "HRA") has established the Richfield Redevelopment Project
Area (the "Project" Area), and approved a Redevelopment Plan (the "Plan") for the Project
Area; and
WHEREAS, the HRA and the City of Richfield, Minnesota (the "City"), have
established the Interchange West and Lyndale Gateway Tax Increment Financing District
(the "TIF District") within the Project Area in accordance with Minnesota Statutes, Sections
469.174 to 469.1799; and
WHEREAS, pursuant to authority conferred by Minnesota Statutes, Section
469.178, and Minnesota Statutes, Chapter 475, the City previously agreed to finance
certain public redevelopment costs to be incurred by the HRA or the City in the Project
Area through the issuance of general obligation bonds of the City in the principal amount of
$8,350,000, designated the General Obligation Tax Increment Bonds, Series 2001A (the
"Refunded Bonds"}; and
WHEREAS, pursuant to a resolution adopted. by the City Council of the City on
November 9, 2010, the City has provided preliminary approval for the issuance of
refunding bonds to redeem and prepay the Refunded Bonds, the sale of which is expected
to occur on December 14, 2010; and
WHEREAS, the City has determined to issue its General Obligation Tax Increment
Refunding Bonds, Series 20108 (the "Refunding Bonds"), in the approximate aggregate
principal amount of $6,465,000, and apply proceeds of the Refunding Bonds to redeem
and prepay the Refunded Bonds and pay interest on the Refunding Bonds pursuant to a
Crossover Refunding Escrow Agreement, dated on or after December 1, 2010, between
the City and the escrow agent named therein; and
WHEREAS, the HRA has agreed to pledge certain tax increment revenues to the
City for the principal and interest on the Refunding Bonds; and
WHEREAS, there has been presented to the HRA an Amended and Restated Tax
Increment Pledge Agreement between the HRA and the City (the "Pledge Agreement")
providing for the pledge of tax increments from the TIF District to payment of principal and
interest on the Refunding Bonds;
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners {the
"Board") of the HRA, as follows:
1. The Chair and Secretary of the HRA are hereby authorized to execute and
deliver the Pledge Agreement substantially in the form on file with the City, providing for
111510 bridge bond refinancing
5-~
the pledge of tax increment derived from property in the TIF District for the payment of the
principal of, premium, if any, and interest on, the Refunding Bonds.
2. This resolution shall be effective as of the date hereof.
Adopted by the Housing and Redevelopment Authority in and .for the City of
Richfield, Minnesota this 15th day of November, 2010.
Suzanne M. Sandahl, Chair
Attest:
Joan Helmberger, Secretary
S-~
Debt Issuance Services
~~ __^ _ __
Activities for the Proposed Crossover Refunding of
$8,350,000 G.O. Tax Increment Bands (Penn Avenue Bridge Bonds}
$6,465,000 G.U. Tax Increment Refunding Bonds
City of Richfield, Minnesota
City Council adopts resolution authorizing the sale of
Bonds: November 9, 2010
WRA considers Pledge Agreement: November 15, 2010
Information is distributed to Standard &Poors: Late November 2010
Official Statement is Distributed: December 2, 2010
Rating Call with Standard &Poors: Week of December 6, 2010
City Council awards bids: December 14, 2010
HRA considers Amendment to Development Agreement December 20, 2010
Bond closing and funds are available: Late December, 2010
FREERS _ _ ___ _- --_ _ - - - ___ __
Minnesota phone 651-697-8500 3060 Centre Pointe Drive
LEADERS IN PUBLIC FINANCE Offices also in Wisconsin and Illinois fax 651-697-8555 Roseville, MN 55113-1122
AGENDA ITEM # 6
REPORT # 41
D
STAFF REPORT
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING
NOVEMBER 15, 2010
REPORT PREPARED BY: JULIE URBAN, HOUSING SPECIALIST
NAME, TITI,Ii
REPORT PRESENTER:
KAREN BARYON, COMMUNITY
DEVELOPMFiNT ASSISTANT DIRECTOR
Natir~:; Tirr.E
DEPARTMENT DIRECTOR REVIEW:
~,
REVIEWED BY EXECUTIVE DIRECT~R:
r ~
ITEM FOR HRA CONSIDERATION:
Consideration of guidelines for the Richfield Rediscovered Lot Sale Program.
I. RECOMMENDED ACTION:
By Motion: Approve the guidelines for the Richfield Rediscovered
Lot Sale Program.
II. BACKGROUND
Richfield Rediscovered has been awell-regarded Housing and Redevelopment
Authority (HRA) program since 1990. Since its inception, 103 new market-rate
homes have been built under the Richfield Rediscovered program. As market
conditions changed and housing prices increased, the program's operation changed
over the years as follows:
1990-2004: The HRA purchased small, substandard properties, demolished
the existing structures, and sold the vacant lots to Builder/Buyer
teams for construction of new homes.
2005: A $50,000 credit was offered to Builder/Buyer teams who located
substandard properties, demolished existing structures and
constructed new homes.
2006: The credit amount was increased to $70.,000.
11152010 RR Lot Sale Guidelines.doc
Due to the foreclosure crisis, housing prices have again fallen in the market, which
has made it economically feasible for the HRA to purchase small, substandard
properties once again. Since 2009, the HRA has purchased seven substandard
properties for the market rate Richfield Rediscovered program. Structures have
been cleared from several of the properties and will be cleared on the remaining
properties. As the lots are cleared, they will become available for sale through the
program.
The current Richfield Rediscovered Guidelines address only the credit option for the
program. Therefore, the following changes are being proposed to provide for the
Richfield Rediscovered Lot-Sale option as well:
• The vacant lots will be appraised and sold at market value.
• A builder or home buyer can apply to purchase a lot through the program.
• The proposed house must meet design and site development requirements.
These standards include a minimum three-bedrooms and two-bathrooms, tree
preservation, minimized garage door presence, and compatibility with the
neighborhood.
• The proposed Architectural Design Advisor program will be available to any
applicants not using an architect.
• Application requirements include plans and elevations; details regarding
construction materials; construction timeline; information on what green building
standards will be incorporated; evidence of financial capability; Builder
references, insurance and warranty, and a copy of the contract and purchase
agreement between the Builder and Buyer
• A Contract for Private Development will be signed with either the Builder or the
Buyer.
• A minimum appraised end-value for the house will be established in the
Contract.
• The program discourages speculative development but does allow the HRA to
approve such a development at its discretion (e.g. in 2004, a Health House was
constructed and sold under the program).
• Following HRA approval, the lot will be sold to the applicant. The HRA will
retain additional security to ensure that the house is constructed as it was
approved. In the case of a Builder applicant, a Letter of Credit equal to $10,000.
In addition, the Contract will include a reverter provision allowing the HRA to
reclaim possession of the lot in the event of foreclosure prior to construction
completion.
• In the case of a Buyer applicant, a mortgage will be placed on the property for
$10,000. This mortgage would be satisfied upon completion of construction in
accordance with the buyer's approved application.
• A $5,000 rebate on the purchase of the lot is proposed for any project achieving
LEED, Minnesota GreenStar or Minnesota Green Communities certification.
• The HRA will hold a public hearing to consider all lot sales.
• The program continues to allow for the development of multi-unit housing where
appropriate.
The Richfield Rediscovered Credit Program will continue to be available in the event
an applicant identifies a substandard property on their own and wishes to apply for
a redevelopment credit.
III. BASIS OF RECOMMENDATION
A. POLICY
• The Richfield Rediscovered Program helps the City to reach the goal
identified in the Richfield Comprehensive Plan to ensure sufficient
diversity in the housing stock to provide for a range of household
sizes, income levels and needs.
• The Program allows for the removal of substandard and functionally
obsolete housing and replaces it with newer, higher valued homes
with square footages and design features sought by families today.
• The development of new homes through the program encourages
existing property owners to make investments in their properties and
in the community.
B. CRITICAL TIMING ISSUES
• The HRA currently has seven lots available for sale through the
program. Following adoption of the program guidelines, the lots will
be appraised and marketed for sale.
C. FINANCIAL
• HRA investment (i.e. purchase price, abatement, demolition and
holding costs) in the lots purchased to date has ranged from $70,000
to $125,000 per lot. Sale prices between $50,000 and $80,000 are
anticipated for the vacant lots, which will reduce the amount of subsidy
provided per lot.
• Funding for the program is available through the Housing and
Redevelopment Fund.
D. LEGAL
• HRA Legal Counsel has reviewed the Program Guidelines and
prepared the sample Contracts for Private Development.
~ IV. ALTERNATIVE RECOMMENDATION(S) J ~
• Do not approve the Program Guidelines
• Approve the Program Guidelines with changes.
ATTACHMENTS ~
• Proposed Richfield Rediscovered Lot Sale Program Guidelines
• Sample Contract for Private Development with Contractor
• Sample Contract for Private Development with Buyer
~ VI. PRINCIPAL PARTIES EXPECTED AT MEETING ~
-,
RICHFIELD REDISCOVERED
PROGRAM GUIDELINES
LOT SALE PROGRAM
REVtSED: NOVEMBER 15, 2010
~o-a2
PROGRAM OBJECTIVES ............................................................................................................................3
DEFINITIONS .................................................................................. ..............................................................3
PROGRAM BASICS ....................................................................... ..............................................................4
APPLICATION REQUIREMENTS .................................................. ..............................................................4
ADDITIONAL REQUIREMENTS .................................................... ..............................................................5
HOUSE DESIGN AND SITE DEVELOPMENT REQUIREMENTS ..............................................................6
New House Standards .............................................................. ..............................................................6
Site Standards ........................................................................... ..............................................................6
Construction Requirements ..................................................... ..............................................................7
General Standards .................................................................... ..............................................................7
Green Community Concepts .................................................... ..............................................................8
CITY REVIEW PROCEDURE ......................................................... ..............................................................8
LOT SALE TO BUILDER/BUYER .................................................. ..............................................................9
PROGRAM MARKETING ............................................................... ..............................................................9
DATA PRIVACY .............................................................................. ............................................................1Q
2
This document has been developed as a guidance tool for program administration. It should not be
interpreted as constituting any contractual agreement or liability by the City or Housing and
Redevelopment Authority (HRA). The HRA may modify or divert from the guidelines where it deems
appropriate.
1. Program Objectives
1. To remove substandard, functionally obsolete housing on scattered sites throughout the City
and replace with new, higher-valued housing.
2. To eliminate the blighting influence of substandard housing, thus improving residential
neighborhoods.
3. To alleviate the shortage of housing choices for families.
4. To facilitate the construction of larger three- to four-bedroom, owner-occupied homes
designed for families.
5. To facilitate the construction of multi-unit, owner-occupied homes designed to expand family
opportunities or to serve elderly residents.
These objectives will be achieved through the sale of lots by the Housing and Redevelopment Authority to
Builder/Buyer teams for the development of newly constructed homes.
II. Definitions
Applicant: An individual who submits an application fior a Richfield Rediscovered lot. The Applicant may
be a Builder or the end Buyer. If the Applicant is a Bu"-lder, an end Buyer should be identified. If the
Applicant is the Buyer, the Applicant must submit a signed contract between the Builder and the Buyer to
build a home on the lot identified in the application.
Buyer. An individual(s) who will build, own and occupy a new housing unit in Richfield.
The Buyer will occupy the property and not offer it for rent. The Buyer may not also function as the
Builder on a Richfield Rediscovered project. The Buyer and Builder must be unrelated separate legal
entities. A specu ative project by a Buyer may be considered if all other program requirements can be
met. However, neither the Buyer, fihe Buyer's Builder or Builder's subcontractors, or the Builder's realty
agents may occupy or purchase the property.
Buyers, unless licensed in the trade specified, may not put any sweat equity into the construction of the
foundation, wall/roof framing, shingling, exterior work, electrical/plumbing/HVAC systems or interior
carpentry.
Builder. Contractor who has signed a contract with the Buyer to build a home on the lot identified in the
application.
Contract for Private Development: A contract between the HRA and the Builder or Buyer that establishes
the conditions under which the lot will be sold and the proposed house will be developed.
Green Community Concepts Plan: A written plan indicating how the proposed development will
incorporate green building features and concepts. Priority will be given to projects that incorporate green
building features.
HRA: Housing and Redevelopment Authority in and for the City of Richfield.
Lot List: A listing of available lots for sale. Information regarding the lot location, size and sale price is
provided.
3
(~j - !1
III. Program Basics
1. HRA publishes a list of available vacant lots for purchase including sale price and
development criteria.
2. Builder/Buyer team proposes a plan for a lot consistent with development criteria and
program requirements and makes an offer to purchase.
3. HRA approves lot sale.
4. Lot is sold to Builder or Buyer.
5. Builder constructs new home.
6. Projects must be completed within one year of HRA approval of the project.
IV. Application Requirements
The following must be submitted for application to the program:
1. $525 application fee
An application fee must be paid at the time of application. This fee is non-refundable and
is not part of the lot price.
2. Application Form
3. Blueprints
The layout of all levels, including basement and unfinished space, must be provided:
4. Elevations
Elevations of all four sides of the house, including view of garage shall be provided.
Colored renderings may also be required.
5. Site plan
The site plan shall indicate the location of the new house, walkways and garage.
6. Landscaping plan
A landscaping plan must indicate the location and type of trees, shrubbery, flowers and
landscaping materials (e.g. rocks, mulch) and any existing trees to be preserved.
7. Detail of construction materials to be used on the project.
8. Green Community Concepts Plan
The plan should indicate what Green Community Concepts will be incorporated into the
project.
9. Construction timeline
Construction must be completed with one year of the purchase of the property.
10. Signed contract with Builder
11. Purchase agreement
If the Builder plans to purchase the lot, the application must include a valid purchase
agreement between the Buyer and the Builder for the lot to be developed.
12. Financial capability statement
A statement from a financial institution indicating willingness to provide sufficient
construction capital to complete the project must be provided.
4
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13. Builder References
a. Five previous customers
b. Three major suppliers, one being the construction supplier
c. Building inspectors from two cities where the Builder has constructed new housing
within the past three years
14. Proof of Builder's Comprehensive General Liability with Property Damage Protection.
15. Proof of sufficient worker's compensation insurance coverage by the Builder.
16. Written warranty program
To be provided to the Buyer, which guarantees at a minimum, warranted repairs as
required by Minnesota State Statute.
V: Additional Program Requirements
1. The Applicant is expected to meet with an architectural/design consultant prior to submitting an
application. A two-hour consultation is available through the HRA at a cost of $25 to the
applicant. See the City's website (www.cityofrichfeld.org) for more information. This requirement
may be waived if the applicant is using an architect for the project.
2. The site will be sold to the Builder or Buyer at the fair market value as appears on the Lot List.
The HRA will not accept offers for less than. the established sale price.
3. A Contract for Private Development is signed by the HRA and the Builder or the Buyer. The
Contract is a standard form which includes conditions far acquisition and development of the
property. The Contract will also establish a minimum required end-value for the property based
on construction estimates provided by the applicant. The Builder or Buyer will be expected to
agree to the terms of the Contract before the application can be scheduled on the HRA agenda.
4. All lots will have a required minimum end value that will be established in the Contract for Private
Redevelopment.
5. The lot can be sold to either the Builder or the Buyer. If the lot is sold to the Builder, the Builder
wil pay cash for the lot at closing and submit a Letter of Credit for $10,000. The Letter of Credit
must be from a financial institution incorporated in the Twin Cities metropolitan area. The Letter
of Credit will be released once the construction and landscape work are completed and a final
Certificate of Occupancy is issued.
6. If the iot is sold to the Builder and the Builder fails to complete construction as approved by the
HRA, the Letter of Credit may be drawn upon by the HRA. In addition, the Contract for Private
Development will contain a reverter provision, which will enable the HRA to reclaim ownership of
the property in the event of a default in the Contract. In the event that the Builder fails to
complete construe#ion, the HRA may exercise its rights under the reverter provision, as well as
draw upon the Letter of Credit.
7. If the lot is sold to the Buyer, the Buyer will pay cash for the lot at closing and a mortgage will be
filed on the property equal to the difference between the cost of the lot and the HRA's total
investment in the property (or a minimum of $10,000). The mortgage will be in first position. The
HRA may consider subordinating its interest in appropriate cases.
8. If the lot is sold to the Buyer and the Buyer fails to complete construction as approved by the
HRA, the HRA may exercise its rights provided in the mortgage.
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VI. House Design and Site Development Requirements
The development of all sites shall meet the development criteria listed below, as reviewed and approved
by the HRA. To maximize the development of a given lot, the HRA reserves the right to explore all
development options without obligating the HRA to support any specific proposal, idea or solicitation.
Housing design is a critical element of the program. Siding materials, exterior fagade presentation, roof,
window, siding and building line variability, finished landscape, interior space function and use are all
important issues of design to the HRA. The design requirements were created to ensure that the homes
built on the HRA-sold lots blend in with the surrounding neighborhood and respond to the specific
concerns of the HRA.
All new houses built under the Richfield Rediscovered Program must meet the requirements of the City's
Zoning Code and additional criteria, as listed in this document.
A. New House Standards
1. New dwelling must be owner-occupied.
2. Three finished bedrooms are required.
3. Two finished bathrooms are required.
4. Two-car garage is required.
5. A full basement is required, unless the selected design results in a split-level or a garden-level
type of basement. In the case of an "accessible" house, a basement may be omitted if it would
otherwise prohibit accessible design elements.
B. Site Standards
1. After construction, the site must be fully landscaped, including plantings around the foundation.
The entire grounds shall be landscaped and be aesthetically pleasing in all seasons. Land
forms and plant materials shal'I be used to define the site and blend neatly with adjoining
properties.. Specific lot lane blending requirements may be required, as appropriate, for specific
sites.
At a minimum, the applicant must meet the "Landscaping and Screening Requirements" in the
City's Zoning Code under Section 544.03, Subd. 4, General landscaping requirements and
Subd. 5, Residential sites. The code is available on the City's website:
http://www.ci. richfield. mn. us
To the greatest extend possible, existing trees should be preserved. Any trees removed must be
replaced (they do not have to be the same species or in the same location) and should be
labeled on the required landscape plan.
2. Utility meters shall be screened from street view and locations must be specified on plans.
Site drainage should be accommodated on the site so that water is directed away from the new
home and the neighboring properties. Neighboring properties must not be disturbed by the
creation of drainage swales. Specific storm water management requirements may be required,
as appropriate, including the addition of gutters or on-site management for specific sites.
Construction and the finished structure must not have a detrimental impact on storm water
drainage patterns in the neighborhood.
4. All air conditioning units must be located in the rear yard of the house, or as approved by the
HRA.
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C. Construction Requirements
1. Existing trees identified on the landscape plan as being preserved, must be protected during
construction. A tree wrap with board reinforcements shall be used on trees directly adjacent to
active grading and construction areas. Damaged or destroyed trees must be replaced.
2. The construction site, neighboring properties and adjacent public streets shall be kept free of
construction debris at all times.
3. No construction workers, construction equipment or construction material shall encroach upon
neighboring properties.
4. The property shall have a new sanitary service line installed to the Gity sanitary sewer main
consisting of schedule 40 PVC or equivalent. If there is an existing 6" sewer stub at the property
line, it must be lined with 4" schedule 40 PVC or equivalent to the City's sanitary main, and it
must include a "donut" at the end with cement.
The line must be televised after installation to ensure the following:
1. There are no obstructions in the line.
2. The PVC liner is not protruding into the City's sanitary sewer main line.
D. General Standards
1. The value of the new home must meet or exceed the minimum value specified in the Contract for
Private Redevelopment.
2. All homes in the Richfield Rediscovered Program must be stick-built or high-quality modular, new
construction.
3. Exterior materials (siding, soffit, doors and windows) should be low-maintenance and durable.
Brick, aluminum, vinyl and HardiPlank siding are preferred. Natural cedar lap is acceptable if
properly stained or painted. Hardboard panels or hardboard lap siding are prohibited. Roof
valleys must have metal val eys and not be woven.
4. Unit height and mass of the new house shall be compatible with the scale of the surrounding
homes in the neighborhood.
5. Plans must present a balanced and pleasing distribution of wall, door and window areas from all
views.
6. The dominance of the garage door must be minimized through placement, architectural detail,
door design and utilization and design of windows. Garages, where the garage door faces the
street, shall not be located closer to the front lot line than the foremost facade of the principal
building facing the front property line. Garage sidewalls that face the street should appear to
contain habitable space. This can be accomplished by incorporating windows and other design
elements into the garage wall that are in character with the remainder of the dwelling. For lots
that have alley access, the garage should be oriented to access the alley.
7. All building plans must have been prepared in consultation with an architect or qualified
draftsperson. All requirements by the Building Inspections Division must be met.
8. All Richfield Rediscovered houses must meet or exceed Minnesota Energy Code requirements.
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9. All new homes shall be built to provide high quality sound insulation. Recommendations for sound
insulation measures may be provided on a site-by-site basis. All construction must conform to
current sound attenuation building standards for properties located in 65-69 and 70-74 DNL
zones.
9. If a variance is required to construct the proposed development, the HRA may, at its sole
discretion, choose to reject the application.
10. If the HRA accepts an application that needs a variance(s), sale of the property will be contingent
upon the applicant obtaining the necessary variance(s). The Applicant is responsible for applying
for the variance(s) at its own expense. The HRA, as owner of the property, will, however,
cooperate with the application.
E. Green Community Concepts
Priority will be given to projects incorporating the green community concepts fisted below. Any
concepts the applicant would like considered during the application process should be explained
in a written plan submitted with the application. A $5,000 rebate will be provided to the Applicant
for projects that obtain certification through LEED for Homes, Minnesota GreenStar or Minnesota
Green Communities.
1. Protect and conserve water and soil. To reduce water consumption, consider the use of water-
conserving appliances, fixtures, and landscaping. Steps should be taken to minimize the loss of
soil and sediment during construction and occupancy to reduce storm-water sediment and air
pollution.
2. Minimize energy consumption. Reduce energy consumption by taking advantage of natural
heating, cooling and day lighting, and by using energy-efficient appliances, equipment and
lighting.
3. Enhance indoor environmental quality. Use non-toxic materials, ventilation and exhaust systems,
and moisture control products and systems.
4. Use environmentally-preferable materials and resources. Use locally-produced, salvaged and/or
manufactured materials, products with recycled content or from renewable sources, recyclable or
reusable materials, and low-VOC-emitting materials.
5. Reduce waste. Reduce and manage wastes generated during the construction process and
operation of buildings. If demolition occurs, sort and recycle leftover materials and debris.
VII. City Review Procedure
1. Applicant reviews proposed project with HRA staff before plans are finalized.
2. Applicant submits application, plans, and application fee at least 45 days prior to the HRA
meeting.
An application is considered to be received when delivered personally to HRA staff in a pre-
arranged meeting. Following this meeting and upon receipt of the application fee, the lot will be
considered reserved and no additional applications will be accepted for the proposed lot while the
application is under review.
(O
4. If an application is determined to be incomplete, the applicant will have 30 days to submit a
complete application. If a complete application is not received within 30 days, the application will
be rejected and the lot will be made available for new applications.
5. HRA staff review application to ensure conformance with House Design and Site Development
Requirements.
6. HRA staff may reject or accept an application at its sole discretion.
7. The Builder or Buyer executes a Contract for Private Redevelopment.
8. An application is determined to be complete and the Contract executed at least three weeks prior to
the HRA meeting.
9. HRA staff publishes a legal notice of the public hearing and prepares a report and
recommendation for the HRA.
10. HRA reviews application, conducts a public hearing, and takes action at the H'RA meeting.
11. If approved, the Contract for Private Redevelopment is executed by the HRA.
VIII. Lot Sale to Builder or Buyer
1. Upon approval of the application by the HRA, a closing will be scheduled between the HRA and
the Builder or Buyer.
2. The HRA will prepare all statements, affidavits, documents, and general release forms required
for closing.
3. The Builder applies for a building permit prior to closing. The Builder is responsible for acquiring
the necessary building permits with the City of Richfield Building Inspections Division. If changes
to the plans are required by the Inspections Division, the applicant must notify HRA staff.
4. The Applicant provides evidence to HRA staff that all requirements to proceed with construction,
as determined in the Contract for Private Redevelopment, have been met.
5. The HRA conveys the property to the Builder or Buyer by Quit Claim Deed. The site will be sold
to the Builder or Buyer at the fair market value as appears on the Lot List.
6. At ciosing with the Builder, the Builder provides a Letter of Credit to the HRA equal to the
difference between the HRA's investment and the vacant land cost.
7. At closing with the Buyer, the Buyer signs a mortgage and promissory note equal to the
difference between the HRA's investment and the vacant land cost.
8. Upon completion of the project, the Letter of Credit is released to the Builder or the Buyer's
mortgage is released. A Certificate of Completion is executed by the HRA, releasing the
obligations of the Contract for Private Redevelopment.
IX. Program Marketing
Richfield Rediscovered program marketing is entirely at the discretion of the HRA. It may include the
following:
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1. Buyer Solicitation. The HRA may market the program to potential Buyers through promotional
articles, direct mail, the Internet, or other methods as deemed appropriate. Buyers may be any
financially capable individual or household, including first-time buyers, move-up buyers or empty-
nesters.
2. Public Promotion.
a. The HRA will periodically provide information about the program through articles in city
publications, on the City's web site, on the Community Cabie channel, or via press
releases to promote community awareness.
b. A public open house may be held to provide an opportunity for residents and other
interested parties to collectively view the finished homes. The Parade of Homes Fall
Showcase and Spring Preview may also accomplish this.
A program information package will be mailed to all interested participants. The information packet may
include the following:
1. Lot List
2. Richfield Rediscovered Lot Sale Procedural Guidelines
3. Application Form
4. Sample Contract for Private Redevelopment
X. Data Privacy
All information secured through the program is subject to the Data Privacy Act.
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11 /4 Draft
Builder Form
CONTRACT FOR PRIVATE DEVELOPMENT
Between
THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD, MINNESOTA
and
at
This Instrument Drafted by:
The Housing and Redevelopment Authority
In and for the City of Richfield
6700 Portland Avenue South
Richfield, Minnesota 55423
Telephone: (612) 861-9760
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CONTRACT FOR PRIVATE DEVELOPMENT
THIS AGREEMENT, made and entered into as of this day of 120 ,
by and between the Housing and Redevelopment Authority in and for the City of Richfield, a
public body corporate and politic under the laws of the State of Minnesota, having its principal
office at 6700 Portland Avenue, Richfield, Minnesota (HRA), and
(Builder).
WITNESSETH:
WHEREAS, the City of Richfield (City) and the HRA have previously created and
established a Redevelopment Project (Project) pursuant to the authority granted in Minnesota
Statutes, Sections 469.001 through 469.047 (collectively, the Acts); and
WHEREAS, pursuant to the Acts, the City .and the HRA have previously adopted a
redevelopment plan for the Project (Redevelopment Plan); and
WHEREAS, in order to achieve the objectives of the Redevelopment Plan and
particularly to make specified land in the Project available for development by private enterprise
for and in accordance with the Redevelopment Plan, the HRA has determined to provide
substantial aid and assistance to finance development costs in the Project; and
WHEREAS, the Builder has proposed a development as hereinafter defined within the
Project which the HRA has determined will promote and carry out the objectives for which the
Project has been undertaken, will assist in carrying out the obligations of the Redevelopment
Plan, will be in the vital best interests of the City and the health, safety and welfare of its
residents and is in accord with the public purposes and provisions of the applicable state and
local laws and requirements under which development in the Project has been undertaken and is
being assisted.
NOW, THEREFORE, in consideration of the mutual covenants and obligation of the
HRA and the Builder, each party does hereby represent, covenant and agree with the other as
follows:
ARTICLE I.
DEFINITIONS, EXHIBITS, RULES OF INTERPRETATION
Section 1.1. Definitions. In this Agreement, the following terms have the meaning
given below unless the context clearly requires otherwise:
(a) Development. The Property and the Improvements to be constructed thereon
according to the Construction Plans approved by the HRA.
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(b) Homeowner. The individuals purchasing the Property from Builder and who
will be living in the home following purchase.
(b) Improvements. Each and all of the structures and site improvements constructed
on the Property by the Builder, as specified in the Construction Plans to be approved by the
HRA.
(c) Minimum Market Value: $ ,which is the minimum
market value for the land and Improvements as confirmed by the Hennepin County Assessor.
(d) Pro er .The real property legally described as:
[Insert Legal]
Located on land having a street address of:
[Insert Address]
(r) Unavoidable Delays. Delays which are the direct result of strikes, labor troubles,
fire or other casualty to the Improvements, litigation commenced by third parties which results in
delays or acts of any federal, state or local government, except those contemplated by this
Agreement, which are beyond the control of the Builder.
Section 1.2 Exhibits. The following Exhibits are attached to and by reference made a
part of this Agreement:
A. Form of Certificate of Completion
B. Program Guidelines -Lot Sale Program ("Guidelines")
C. Quit Claim Deed
Section 1.3 Rules of Interpretation.
(a) This Agreement shall be interpreted in accordance with and governed by the laws
of the State of Minnesota.
(b) The words "herein" and "hereof' and words of similar import, without reference
to any particular section or subdivision refer to this Agreement as a whole rather than any
particular section or subdivision hereof.
(c) References herein to any particular section or subdivision hereof are to the section
or subdivision of this Agreement as originally executed.
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(d) Any titles of the several parts, articles and sections of this Agreement are inserted
for convenience and reference only and shall be disregarded in construing or interpreting any of
its provisions.
ARTICLE II.
REPRESENTATIONS AND UNDERTAKINGS
Section 2.1 By the Builder. The Builder makes the following representations and
undertakings:
(a) The Builder has the legal authority and power to enter into this Agreement and has
duly authorized the execution, delivery and performance of this Agreement;
(b) The Builder has the necessary equity capital or will obtain commitments for
financing necessary for construction of the Improvements;
(c) The Builder will construct the Improvements in accordance with the terms of this
Agreement and all local, state and federal laws and regulations;
(d) The Builder will obtain, in a timely manner, all required permits, licenses and
approvals, and will meet, in a timely manner, the requirements of all local, state and federal laws
and regulations which must be obtained or met before the Improvements may be constructed; and
(e) The plans for the Improvements have been prepared by a qualified draftsperson or
architect.
(f) The Builder has read and understands the Guidelines and agrees to be bound by
them.
Section 2.2 By the HRA. The HRA makes the following representations as the basis for
the undertaking on its part herein contained:
(a) The HRA is authorized by law to enter into this Agreement and to carry out its
obligations hereunder; and
(b) The HRA will, in a timely manner, subject to all notification requirements, review
and act upon all submittals and applications of the Builder and will cooperate with the efforts of
Builder to secure the granting of any permit, license, or other .approval required to allow the
construction of the Improvements.
ARTICLE III.
ACQUISITION OF PROPERTY; CONVEYANCE TO BUILDER
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Section 3.1 Purchase of Property by Builder. The HRA agrees to sell the Property to
Builder and the Builder agrees to purchase the Property from the HRA in an "as-is"
condition.The same of the Property is contingent upon the Builder providing the HRA with
evidence satisfactory to the HRA that Builder has entered into a binding legal commitment, in
the form of a Purchase Agreement for the resale of the Property to a Homeowner following
completion of the Improvements. The HRA agrees to convey the Property to the Builder by Quit
Claim Deed in the general form of Exhibit C. The HRA's deed to the Builder will contain the
right of reverter required in Section 8.3. The purchase price for the Property, payable at Closing,
will be $
Section 3.2. Title and Examination. The HRA will provide the Builder with an
abstract of title or registered property abstract regarding the Property. In the absence of an
abstract of title or registered property abstract, the HRA will provide a title commitment. The
Builder shall have 20 days from the date it receives such abstract or such commitment to raise
any objections to title it may have. Objections not made within such time will be deemed
waived. The HRA shall have 90 days from the date of such objection to effect a cure. Provided,
however, that the HRA shall have no obligation to cure any objections, and may inform Builder
of such. The Builder may then elect to close notwithstanding the uncured objections or declare
this Agreement null and void, and the parties will thereby be released from any further obligation
hereunder.
Section 3.3 Taxes and Special Assessments. Real estate taxes and installments of
special assessments will be prorated between the HRA and Builder as of the date of closing.
Section 3.4 Soil Conditions and Hazardous Wastes. The Builder acknowledges that
the HRA makes no representations or warranties as to the conditions of the soils on the Property,
its fitness for the construction of improvements or any other purpose for thich the Builder may
use the Property, or regarding the presence of hazxardous wastes on the Property. The HRA will
allow reasonable access to the Property for the Builder to conduct such tests regarding soils
conditions and hazardous wastes as the Byer may desire. Permission to enter the Property to
conduct such tests must be given in writing under reasonable terms and conditions established by
the HRA.
Section 3.5 Site Clearance. The HRA will be responsible for clearance of all buildings
as required to prepare the Property for development. All other site preparation is the
responsibility of Builder. Builder will comply with all of the provisions of the Guidelines
relating to tree protection, preservation and replacement.
Section 3.6 Other Preconditions to Closing. Closing may not take place until the
HRA is satisfied that the Project is in all respects in full compliance with the provisions of the
Guidelines contained in Exhibit B. It is anticipated that the Builder will involve the Homeowner
in the various activities required under the Guidelines so that the Homeowner will have an
opportunity to contribute suggestions concerning development of the Property.
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Section 3.6 Closing. Closing must take place on or before ,
20 , or such other date as may be agreed to by the Builder and HRA in writing. At Closing,
pursuant to Section 5.1, the Builder will provide the HRA with a Letter of Credit.
ARTICLE IV.
CONSTRUCTION OF IMPROVEMENTS
Section 4.1. Construction of Improvements. The Builder shall construct the
Improvements on the Property in accordance with the Guidelines, the Construction Plans, shall
meet or exceed the Minimum Market Value specified in Section 1.1, and shall maintain, preserve
and keep the Improvements in good repair and condition. The Construction Plans shall be
reviewed by the HRA, and if in conformity with this Agreement and the Guidelines, will be
approved following review and comment by the Homeowner.
Section 4.2. Building Plans. No building permit will be issued by the City unless the
building plans are in conformity with the Guidelines, Construction Plans, with the Builder's
Minimum Market Value, other requirements contained in this Agreement, and all local, state and
federal regulations. The Builder shall provide the HRA with a set of Building Plans to be used in
connection with any application for a building permit. The HIZA shall, within 25 days of receipt
of the Building Plans review the same to determine whether the foregoing requirements have
been met. If the HRA determines such Building Plans to be deficient, it shall notify the Builder
in writing stating the deficiencies and the steps necessary for correction. Issuance of the building
permit by the City shall be a conclusive determination that the Building Plans have been
approved and shall satisfy the provisions of this Section 4.2.
Section 4.3 Schedule of Construction. Subject to Unavoidable Delays, construction of
the Improvements shall be completed prior to , 200 .All construction shall be
in conformity with the approved Construction Plans and the Guidelines. Periodically during
construction the Builder shall make reports in such detail as may reasonably be requested by the
HRA concerning the actual progress of construction. If at any time prior to completion of
construction the HRA has cause to believe that the Builder will be unable to complete
construction of the Improvements in the time permitted by this Section 4.3, it may notify the
Builder and demand assurances from the Builder regarding the Builder's construction schedule.
If such assurances are not forthcoming or are deemed by the HRA at its sole discretion to be
inadequate, the HRA may declare an Event of Default and may avail itself of any of the remedies
specific in Section 8.2 of this Agreement.
Section 4.4 Certificate of Completion. Promptly after notification by the Builder of
completion of construction of the Improvements, the HRA shall inspect the construction to
determine whether the Improvements have been completed in accordance with the Construction
Plans and the terms of this Agreement, including the date of the completion thereof. In the event
that the HRA is satisfied with the construction, the HRA shall furnish the Builder with a
Certificate of Completion in the form attached hereto as Exhibit A. Such certification by the
HRA shall be a conclusive determination of satisfaction and termination of the agreements and
covenants in this Agreement with respect to the obligation of the Builder to construct the
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Improvements. Issunace of the Certificate of Completion shall also serve as a satisfaction of any
obligation of Builder secured by the Letter of Credit, and the Letter of Credit will be released. At
the time a Certificate of Completion is issued, the HRA will also provide Builder with a $5,000
cash rebate if Builder has obtained Green Community Concepts certification through LEED for
Homes, Minnesota GreenStar or Minnesota Green Communities.
If the HRA shall refuse or fail to provide certification in accordance with the provisions
of this Section 4.4, the HRA shall within 15 days of such notification provide the Builder with a
written statement, indicating in adequate detail in what respects the Builder has failed to
complete the Improvements in accordance with the provisions of this Agreement necessary, in
the opinion of the HRA, for the Builder to take or perform in order to obtain such certification.
Section 4.5 Failure to Construct. In the event that construction of the Improvements is
not completed as provided in Section 4.3 of this Agreement, an Event of Default shall be deemed
to have occurred, and the HRA may proceed with its Remedies on Default under this Agreement.
ARTICLE V.
REDEVELOPMENT ASSISTANCE
Section 5.1 Issuance of the Letter of Credit. Builder acknowledges that although it is
purchasing the Property at its fair market value as raw land, the HRA has incurred significant
costs in acquiring and preparing the Property for development by Builder. At Closing, Builder
will deliver to the HRA a Letter of Credit in principal amount of $10,000. The Letter of Credit
will be in a form, contain provisions and be issued by a banking institution acceptable to the
HRA. The obligation to pay the $10,000 will be forgiven, and the Letter of Credit will be
released if: (i) the Builder receives a Certificate of Completion; (ii) is not otherwise in default of
any of its obligations hereunder; and (iii) closes on the sale of the Property to the Homeowner
within days following the issuance of the Certificate of Completion. If such have not
occurred, an Event of Default shall be deemed to have occurred and the HRA may exercise its
remedies under Section 8.2.
ARTICLE VI.
FINANCING
Section 6.1 Financing. Within 20 days of the date of execution of this Agreement, the
Builder shall submit to the HRA evidence of financing for the Improvements in compliance with
the provisions of Section 2.1(b) of this Agreement. If the HRA finds that the financing is
adequate in amount to provide for the construction of the Improvements, the HRA shall notify
the Builder of its approval.
If the HRA rejects the evidence of financing as inadequate, the Builder shall have 30 days
or such additional period of time as the Builder may reasonably require from the date of such
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notification to submit evidence of financing satisfactory to the HRA. If the Builder fails to
submit such evidence or fails to use due diligence in pursuing financing, the HRA may terminate
this Agreement and both parties shall be released from any further obligation or liability
hereunder. Closing shall not take place until Builder has provided HRA with acceptable
evidence of financing for construction of the Improvements.
Section 6.2 Copy of Notice of Default to Lender. Whenever the HRA shall deliver any
notice or demand to the Builder with respect to any Event of Default by the Builder in its
obligations or covenants under this Agreement, the HRA shall at the same time forward a copy of
such notice or demand to each Holder of any Mortgage authorized by the Agreement at the last
address of such Holder shown in the records of the HRA.
Section 6.3 Subordination. In order to facilitate obtaining financing for the
construction of the Improvements by the Builder, the HRA may, in its sole and exclusive
discretion, agree to modify this Agreement in the manner and to the extent the HRA deems
reasonable, upon request by the financial institution and the Builder.
ARTICLE VII.
PROHIBITIONS AGAINST ASSIGNMENT AND TRANSFER
Section 7.1 Representation as to Redevelopment. The Builder represents and agrees
that its undertakings pursuant to the Agreement, are for the purpose of development of the
Property and not for speculation in land holding. The Builder further recognizes that, in view of
the importance of the Development to the general welfare of Richfield and the substantial
financing and other public aids that have been made available by the HRA for the purpose of
making the Development possible, the qualification and identity of the Builder are of particular
concern to the HRA. The Builder further recognizes that it is because of such qualifications and
identity that the HRA is entering into this Agreement, and, in so doing, is further willing to rely
on the representations and undertakings of the Builder for the faithful performance of all
undertakings and covenants agreed by the Builder to be performed.
Section 7.2 Prohibition Against Transfer of Property and Assignment of
Agreement. For the reasons set out in Section 7.1 of this Agreement, the Builder represents and
agrees that prior to the issuance of the Certificate of Completion by the HRA:
Except only by way of security for, and only for the purpose of obtaining financing
necessary to enable the Builder or any successor in interest to the Property, or any part thereof, to
perform its obligations with respect to the Development under this Agreement, and any other
purpose authorized by this Agreement, the Builder, except as so authorized, has not made or
created, and that it will not make or create, or suffer to be made or created, any total or partial
sale, assignment, conveyance, or any trust in respect to this Agreement or the Property or any part
thereof or any interest therein, or any contract or agreement to do any of the same, without the
prior written approval of the HRA. This provision shall not be deemed as preventing the Builder
from entering into a Purchase Agreement for the sale of the Property to a Homeowner.
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ARTICLE VIII.
EVENTS OF DEFAULT
Section 8.1 Events of Default Defined. The following shall be deemed Events of
Default under this Agreement and the term shall mean, whenever it is used in this Agreement,
unless the context otherwise provides, any one or more of the following events:
(a) Failure by the Builder to pay when due the payments required to be paid or
secured under any provision of this Agreement;
(b) Failure by the Builder to observe and substantially perform any covenant,
condition, obligation or agreement on its part to be observed or performed hereunder, including
the time for such performance;
(c) If the Builder shall admit in writing its inability to pay its debts generally as they
become due, or shall file a petition in bankruptcy, or shall make an assignment for the benefit of
its creditors, or shall consent to the appointment of a receiver of itself or of the whole or any
substantial part of the Property;
(d) If the Builder, on a petition in bankruptcy filed against it, be adjudicated as
bankrupt, or a court of competent jurisdiction shall enter an order of decree appointing, without
the consent of the Builder, a receiver of the Builder or of the whole or substantially all of its
property, or approve a petition filed against the Builder seeking reorganization or arrangement of
the Builder under the federal bankruptcy laws, and such adjudication, order or decree shall not be
vacated or set aside or stayed within 60 days from the date of entry thereof; or
(e) If the Development is in default under any Mortgage and has not entered into a
work-out agreement with the Mortgagee.
Section 8.2 Remedies on Default. Whenever any Event of Default occurs, the HRA
may, in addition to any other remedies or rights given the HI2A under this Agreement, take any
one or more of the following actions following written notice by the HRA to the Builder as
provided in Section 9.3 of this Agreement:
(a) suspend its performance under this Agreement until it receives assurances from the
Builder, deemed reasonably adequate by the HRA, that the Builder will cure its default and
continue its performance under this Agreement;
(b) cancel or rescind this Agreement;
(c) exercise its right under Section 8.3;
(d) draw the full amount of the Letter of Credit;
(e) withhold the Certificate of Completion; or
3774llvC JBD RC125-1
g
37741 I v2 ,iBD RC 125-1
~ - ao
(f) take whatever action at law or in equity may appear necessary or desirable to the
HRA to enforce performance and observance of any obligation, agreement, or
covenant of the Builder under this Agreement;
provided, however, that any exercise by the HRA of its rights or remedies hereunder shall
always be subject to and limited by, and shall not defeat, render invalid or limit in any
way (a) the lien of any Mortgage authorized by this Agreement and (b) any rights or
interest provided in this Agreement for the protection of the Holders of a Mortgage; and
provided further that should any Mortgagee succeed by foreclosure of the Mortgage or
deed in lieu thereof to the Builder's interest in the Property, it shall, notwithstanding the
foregoing, be obligated to perform the obligations of the Builder under this Agreement to
the extent that the same have not therefore been performed by the Builder.
Section 8.3 Reinvesting Interest in HRA Upon Happening of Event of Default
Subsequent to Conveyance of Property to Builder. In the event that subsequent to the closing
or the sale of the Property to the Builder and prior to the issuance of the Certificate of
Completion:
(a) the Builder fails to begin construction of the Improvements in conformity with this
Agreement, and such failure is not due to Unavoidable Delays;
(b) the Builder, after commencement of the construction of the Improvements, defaults in
or violates obligations with respect to the construction of the Improvements, including the nature
and the date for the completion thereof, or abandons or substantially suspends construction work,
and such act or actions is not due to Unavoidable Delays;
(c) the Builder or successor in interest fails to pay real estate taxes or assessments on the
Property or any part thereof when due, or places thereon any encumbrance or lien unauthorized
by this Agreement, or suffers any levy or attachment to be made, or any supplier's or mechanic's
lien, or any other unauthorized encumbrance or lien to attach;
(d) there is, in violation of Article VII of this Agreement, any transfer of the Property or
any part thereof; or
(e) the Builder fails to comply with any of its covenants under this Agreement, then the
HRA shall have the right upon 30 days written notice to Builder and the Builder's failure to cure
within such 30 days period to re-enter and take possession of the Property and to terminate and
revest in the HRA the interest of the Builder in the Property; provided, however, that such
revestiture of title shall be subject to the lien of any prior encumbrance permitted under this
Agreement, or any right of a Homeowner pursuant to a valid Purchase Agreement authorized by
this Agreement.
Section 8.4 No Remedy Exclusive. No remedy herein conferred upon or reserved to the
HRA is intended to be exclusive of any other available remedy or remedies, but each and every
3774llvC JBD RC12~-1
9
377411 v2 JBD RC 125-]
C9-~1
such remedy shall be cumulative and shall be in addition to every other remedy given under this
Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to
exercise any right or power accruing upon any default shall impair any such right or power or
shall be construed to be a waiver thereof, but any such right and power may be exercised from
time to time and as often as may be deemed expedient. In order to entitle the HRA or the Builder
to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such
notice as may be required in this Article VIII.
Section 8.5 No Additional Waiver Implied by One Waiver. In the event of the
occurrence of any Event of Default by either party, which Event of Default is thereafter waived
by the other party, such waiver shall be limited to the particular Event of Default so waived and
shall not be deemed to waive any other concurrent, previous or subsequent Event of Default.
ARTICLE IX.
ADDITIONAL PROVISIONS
Section 9.1 Conflict of Interests; Representatives Not Individually Liable. No HRA
officer who is authorized to take part in any manner in making this Agreement in his or her
official capacity shall voluntarily have a personal financial interest in this Agreement or benefit
financially there from. No member, official, or employee of the HRA shall be personally liable
to the Builder, or any successor in interest, for any Event of Default by the HRA or for any
amount which may become due to the Builder or successor or on any obligations under the terms
of this Agreement.
Section 9.2 Non-Discrimination. The provisions of Minnesota Statutes Section 181.59,
which relate to civil rights and non-discrimination, and any affirmative action program of the
City shall be considered a part of this Agreement and binding on the Builder as though fully set
forth herein.
Section 9.3 Notices and Demands. Except as otherwise expressly provided in this
Agreement, a notice, demand or other communication under this Agreement by either party to the
other shall be sufficiently given or delivered if it is sent by mail, postage prepared, return receipt
requested or delivered personally:
(a) As to the HRA:
Richfield HRA
Executive Director
6700 Portland Avenue South
Richfield, MN 55423
377411vC JBD RC]25-I
10
377411v2 JBD RC125-1
(o - ~"
(b) As to the Builder:
or at such other address with respect to either such party as that party may, from time to time,
designate in writing and forward to the other as provided in this Section 9.3.
Section 9.4 Counterparts. This Agreement may be simultaneously executed in any
number of counterparts, all of which shall constitute one and the same instrument.
377411vC JBD RC125-1
ll
3774112 JBD RC125-1
~ a3
IN WITNESS WHEREOF, the HRA has caused this Agreement to be duly executed in
its name and behalf and its seal to be hereunto duly affixed and the Builder has caused this
Agreement to be duly executed as of the day and year first above written.
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
RICHFIELD, MINNESOTA
By
377411vC 1BD RC125-1
Its Chairperson
By
Its Executive Director
Builder
12
37741 Iv2.IBD RC125-1
~ - au
STATE OF MINNESOTA
COUNTY OF
SS
The foregoing instrument was acknowledged before me this day of
20 , by ,the Chairperson of the Housing and
Redevelopment Authority in and for the City of Richfield, Minnesota (HRA), a public body
corporate and politic under the laws of Minnesota, on behalf of the HRA.
STATE OF MINNESOTA
COUNTY OF
Notary Public
SS
The foregoing instrument was acknowledged before rrke this day of
20 , by ,the Executive Director of the Housing
and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA), a public body
corporate and politic under the laws of Minnesota, on behalf of the HRA.
Notary Public
STATE OF MINNESOTA
COUNTY OF
} SS
The foregoing instrument was acknowledged before me this
20 , by
Notary Public
377411vC JBD RC125-I
13
day of
37741 ]v2 JBD RC125-]
(p
EXHIBIT A
FORM OF CERTIFICATE OF COMPLETION
The undersigned hereby certifies that ,has fully and
completely complied with its obligations under Article IV of that document entitled "Contract for
Private Development", between the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota and dated ,
filed as Document No. with respect
to the construction of the approved construction plans at ,legally
described as and is released and forever discharged from its
obligations to construct under such above-referenced Article.
DATED:
STATE OF MINNESOTA )
SS
COUNTY OF HENNEPIN }
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
RICHFIELD
By:
Its: Chairperson
By:
Its: Executive Director
The foregoing instrument was acknowledged before me this day of
20, by and
the Chairperson and Executive Director of the Housing and Redevelopment Authority in and for
the City of Richfield, a public body corporate and politic under the laws of the State of
Minnesota on behalf of the public body corporate and politic.
This instrument was drafted by:
Kennedy & Graven, Chartered
470 U.S. Bank Plaza
200 South Sixth Street
Minneapolis, MN 55402
Error^. unknown document property name.
Notary Public
A-1
Error: unknown document property name.
~-a~
EXHIBIT B
PROGRAM GUIDELINES -LOT SALE PROGRAM
[To be added]
Error: Unknown document property name.
B-1
Error'. Unknown document property name.
~ - a~
EXHIBIT C
Error: Lnkno~~n document property name.
QUIT CLAIM DEED
[TO BE ADDED]
C-1
Error: L;nknown document property name.
~-a$
Error: Unknown document property name.
EXHIBIT D
NOTE AND MORTGAGE
f TO BE SUPPLIEDI
C-2
Error: Unknown document property name.
~ a°~
Error'. l nknown document property name.
D-1
Error'. linknow°n document property name.
lo- 3a
CONTRACT FOR PRIVATE DEVELOPMENT
Between
THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD, MINNESOTA
and
at
This Instrument Drafted by:
The Housing and Redevelopment Authority
In and for the City of Richfield
6700 Portland Avenue South
Richfield, Minnesota 55423
Telephone: (612) 861-9760
1 I /4 Draft
Buyer Form
377417v3 JBD RE125-1
C~ - 3 I
CONTRACT FOR PRIVATE DEVELOPMENT
THIS AGREEMENT, made and entered into as of this day of ~ 20,
by and between the Housing and Redevelopment Authority in and for the City of Richfield, a
public body corporate and politic under the laws of the State of Minnesota, having its principal
office at 6700 Portland Avenue, Richfield, Minnesota (HRA), and
(Buyer).
WITNESSETH:
WHEREAS, the City of Richfield (City) and the HRA have previously created and
established a Redevelopment Project (Project) pursuant to the authority granted in Minnesota
Statutes, Sections 469.001 through 469.047 (collectively, the Acts); and
WHEREAS, pursuant to the Acts, the City and the HRA have previously adopted a
redevelopment plan for the Project (Redevelopment Plan); and
WHEREAS, in order to achieve the objectives of the Redevelopment Plan and
particularly to make specified land in the Project available for development by private enterprise
for and in accordance with the Redevelopment Plan, the HRA has determined to provide
substantial aid and assistance to finance development costs in the Project; and
WHEREAS, the Buyer has proposed a development as hereinafter defined within the
Project which the HRA has determined will promote acid carry out the objectives for which the
Project has been undertaken, will assist in carrying out the obligations of the Redevelopment
Plan, will be in the vital best interests of the City and the health, safety and welfare of its
residents and is in accord with the public purposes and provisions of the applicable state and
local laws and requirements under which development in the Project has been undertaken and is
being assisted.
NOW, THEREFORE, in consideration of the mutual covenants and obligation of the
HRA and the Buyer, each party does hereby represent, covenant and agree with the other as
follows:
ARTICLE I.
DEFINITIONS, EXHIBITS, RULES OF INTERPRETATION
Section 1.1. Definitions. In this Agreement, the following terms have the meaning
given below unless the context clearly requires otherwise:
(a) Development. The Property and the Improvements to be constructed thereon
according to the Construction Plans approved by the HRA.
(b) Improvements. Each and all of the structures and site improvements constructed
on the Property by the Buyer, as specified in the Construction Plans to be approved by the HRA.
1
377417v3 JBD RE125-1
~ - 3a-
(c) Minimum Market Value. $ ,which is the minimum
market value for the land and Improvements as confirmed by the Hennepin County Assessor.
(d) Pro er .The real property legally described as:
[Insert Legal]
Located on land having a street address of:
[Insert Address]
(r) Unavoidable Delays. Delays which are the direct result of strikes, labor troubles,
fire or other casualty to the Improvements, litigation commenced by third parties which results in
delays or acts of any federal, state or local government, except those contemplated by this
Agreement, which are beyond the control of the Buyer.
Section 1.2 Exhibits. The following Exhibits are attached to and by reference made a
part of this Agreement:
A. Form of Certificate of Completion
B. Program Guidelines -Lot Sale Program ("Guidelines")
C. Quit Claim Deed
D. The Note and Mortgage
Section 1.3 Rules of Interpretation.
(a) This Agreement shall be interpreted in accordance with and governed by the laws
of the State of Minnesota.
(b} The words "herein" and "hereof' and words of similar import, without reference
to any particular section or subdivision refer to this Agreement as a whole rather than any
particular section or subdivision hereof.
(c) References herein to any particular section or subdivision hereof are to the section
or subdivision of this Agreement as originally executed.
(d) Any titles of the several parts, articles and sections of this Agreement are inserted
for convenience and reference only and shall be disregarded in construing or interpreting any of
its provisions.
2
377417v3 JBD RE]25-1
l0 " Zj3
ARTICLE II.
REPRESENTATIONS AND UNDERTAKINGS
Section 2.1 By the Buyer. The Buyer makes the following representations and
undertakings:
(a) The Buyer has the legal authority and power to enter into this Agreement and has
duly authorized the execution, delivery and performance of this Agreement;
(b) The Buyer has the necessary equity capital or will obtain commitments for
financing necessary for construction of the Improvements;
(c) The Buyer will construct the Improvements in accordance with the terms of this
Agreement and all local, state and federal laws and regulations;
(d) The Buyer will obtain, in a timely manner, all required permits, licenses and
approvals, and will meet, in a timely manner, the requirements of all local, state and federal laws
and regulations which must be obtained or met before the Improvements may be constructed; and
(e) The plans for the Improvements have been prepared by a qualified draftsperson or
architect.
(f) Buyer intends to reside at the Property following completion of construction; and
is not acquiring the Property for the purpose of resale or speculation.
Section 2.2 By the HRA. The HRA makes the following representations as the basis for
the undertaking on its part herein contained:
(a) The HRA is authorized by law to enter into this Agreement and to carry out its
obligations hereunder; and
(b) The HRA will, in a timely manner, subject to all notification requirements, review
and act upon all submittals and applications of the Buyer and will cooperate with the efforts of
Buyer to secure the granting of any permit, license, or other approval required to allow the
construction of the Improvements.
ARTICLE III.
ACQUISITION OF PROPERTY; CONVEYANCE TO BUYER
Section 3.1 Purchase of Property by Buyer. The HRA agrees to sell the Property to
Buyer and the Buyer agrees to purchase the Property from the HRA in an "as-is" condition. The
HRA agrees to convey the Property to the Buyer by Quit Claim Deed in the general form of
Exhibit C. The purchase price for the Property will be $
3
377417v3 JBD RE125-1
~ -3~
Section 3.2. Title and Examination. The HRA will provide the Buyer with an abstract
of title or registered property abstract regarding the Property. In the absence of an abstract of title
or registered property abstract, the HRA will provide a title commitment. The Buyer shall have
20 days from the date it receives such abstract or such commitment to raise any objections to title
it may have. Objections not made within such time will be deemed waived. The HRA shall have
90 days from the date of such objection to effect a cure. Provided, however, that the HRA shall
have no obligation to cure any objections, and may inform Buyer of such. The Buyer may then
elect to close notwithstanding the uncured objections or declare this Agreement null and void,
and the parties will thereby be released from any further obligation hereunder.
Section 3.3 Taxes and Special Assessments. Real estate taxes and installments of
special assessments will be prorated between the HRA and Buyer as of the date of closing.
Section 3.4 Soil Conditions and Hazardous Wastes. The Buyer acknowledges that the
HRA makes no representations or warranties as to the conditions of the soils on the Property, its
fitness for the construction of improvements or any other purpose for thich the Buyer may use the
Property, or regarding the presence of hazxardous wastes on the Property. The HRA will allow
reasonable access to the Property for the Buyer to conduct such tests regarding soils conditions
and hazardous wastes as the Byer may desire. Permission to enter the Property to conduct such
tests must be given in writing under reasonable terms and conditions established by the HRA.
Section 3.5 Site Clearance. The HRA will be responsible for clearance of all buildings
as required to prepare the Property for development. All other site preparation is the
responsibility of Buyer. Buyer will comply with all of the provisions of the Guidelines relating
to tree protection, preservation and replacement.
Section 3.6 Other Preconditions to Closing. Closing may not take place until the
HRA is satisfied that the Project is in alI respects in full compliance with the provisions of the
Guidelines contained in Exhibit B.
Section 3.6 Closing. Closing must take place on or before ,
20, or such other date as may be agreed to by the Buyer and HRA in writing. At Closing,
pursuant to Section 5.1, the Buyer will provide the HRA with a note and mortgage in recordable
form (and pay for the cost of recording). The Mortgage will be prior to all other liens on the
Property.
ARTICLE IV.
CONSTRUCTION OF IMPROVEMENTS
Section 4.1. Construction of Improvements. The Buyer shall construct the
Improvements on the Property in accordance with the Guidelines, the Construction Plans, shall
meet or exceed the Minimum Market Value specified in Section 1.1, and shall maintain, preserve
and keep the Improvements in good repair and condition.
Section 4.2. Building Plans. No building permit will be issued by the City unless the
building plans are in conformity with the Guidelines contained in Exhibit B, Construction Plans,
4
377417v3 .iBD RE125-1
~- 3S
with the Buyer's Minimum Market Value, other requirements contained in this Agreement, and
all local, state and federal regulations. The Buyer shall provide the HRA with a set of Building
Plans to be used in connection with any application for a building permit. The HRA shall, within
25 days of receipt of the Building Plans review the same to determine whether the foregoing
requirements have been met. If the HRA determines such Building Plans to be deficient, it shall
notify the Buyer in writing stating the deficiencies and the steps necessary for correction.
Issuance of the building permit by the City shall be a conclusive determination that the Building
Plans have been approved and shall satisfy the provisions of this Section 4.2.
Section 4.3 Schedule of Construction. Subject to Unavoidable Delays, construction of
the Improvements shall be completed prior to , 200 .All construction shall be
in conformity with the approved Construction Plans and the Guidelines. Periodically during
construction the Buyer shall make reports in such detail as may reasonably be requested by the
HRA concerning the actual progress of construction. If at any time prior to completion of
construction the HRA has cause to believe that the Buyer will be unable to complete construction
of the Improvements in the time permitted by this Section 4.3, it may notify the Buyer and
demand assurances from the Buyer regarding the Buyer's construction schedule. If such
assurances are not forthcoming or are deemed by the HRA at its sole discretion to be inadequate,
the HRA may declare an Event of Default and may avail itself of any of the remedies specific in
Section 8.2 of this Agreement.
Section 4.4 Certificate of Completion. Promptly after notification by the Buyer of
completion of construction of the Improvements, the HRA shall inspect the construction to
determine whether the Improvements have been completed in accordance with the Construction
Plans and the terms of this Agreement, including the date of the completion thereof. In the event
that the HRA is satisfied with the construction, the HRA shall furnish the Buyer with a
Certificate of Completion in the form attached hereto as Exhibit A. Such certifcation by the
HRA shall be a conclusive determination of satisfaction and termination of the agreements and
covenants in this Agreement with respect to the obligation of the Buyer to construct the
Improvements. Issunace of the Certificate of Completion shall also serve as a satisfaction of any
obligation of Buyer under the Note and Mortgage. At the time a Certificate of Completion is
issued, the HRA will also provide Buyer with a $5,000 cash rebate if Buyer has obtained Green
Community Concepts certification through LEED for Homes, Minnesota GreenStar or Minnesota
Green Communities.
If the HRA shall refuse or fail to provide certification in accordance with the provisions
of this Section 4.4, the HRA shall within 15 days of such notification provide the Buyer with a
written statement, indicating in adequate detail in what respects the Buyer has failed to complete
the Improvements in accordance with the provisions of this Agreement necessary, in the opinion
of the HRA, for the Buyer to take or perform in order to obtain such certification.
Section 4.5 Failure to Construct. In the event that construction of the Improvements is
not completed as provided in Section 4.3 of this Agreement, an Event of Default shall be deemed
to have occurred, and the HRA may proceed with its Remedies on Default under this Agreement.
ARTICLE V.
5
377417v3 JBD RE125-1
(~-3b
REDEVELOPMENT ASSISTANCE
Section 5.1 Issuance of the Note and Mort~a~e. Buyer acknowledges that although it
is purchasing the Property at its fair market value as raw land, the HRA has incurred significant
costs in acquiring and preparing the Property for development by Buyer. At Closing, Buyer will
execute and deliver to the HRA a Note in principal amount of $10,000 in the form of a Mortgage
securing the Note in substantially the form of the attached Exhibit D. The Note will be forgiven,
and the Mortgage will be released if the Buyer receives a Certificate of Completion, and is not
otherwise in default of any of its obligations hereunder. If a Certificate of Completion is not
issued within the time period specified in Section 4.3, or if the Buyer sells the Property before the
issuance of a Certificate of Completion, an Event of Default shall be deemed to have occurred
and the HRA may exercise its remedies under Section 8.2.
ARTICLE VI.
FINANCING
Section 6.1 Financing. Within 20 days of the date of execution of this Agreement, the
Buyer shall submit to the HRA evidence of financing for the Improvements in compliance with
the provisions of Section 2.1(b) of this Agreement. If the HRA finds that the financing is
adequate in amount to provide for the construction of the Improvements, the HRA shall notify
the Buyer of its approval.
If the HRA rejects the evidence of financing as inadequate, the Buyer shall have 30 days
or such additional period of time as the Buyer may reasonably require from the date of such
notification to submit evidence of financing satisfactory to the HRA. If the Buyer fails to submit
such .evidence or fails to use due diligence in pursuing financing, the HRA may terminate this
Agreement and both parties shall be released from any further obligation or liability hereunder.
Closing shall not take place until Buyer has provided HRA with acceptable evidence of financing
for construction of the Improvements.
Section 6.2 Copy of Notice of Default to Lender. Whenever the HRA shall deliver any
notice or demand to the Buyer with respect to any Event of Default by the Buyer in its
obligations or covenants under this Agreement, the HRA shall at the same time forward a copy of
such notice or demand to each Holder of any Mortgage authorized by the Agreement at the last
address of such Holder shown in the records of the HRA.
Section 6.3 Subordination. In order to facilitate obtaining financing for the
construction of the Improvements by the Buyer, the HI2A may, in its sole and exclusive
discretion, agree to modify this Agreement, the Note or the Mortgage in the manner and to the
extent the HRA deems reasonable, upon request by the financial institution and the Buyer.
ARTICLE VII.
PROHIBITIONS AGAINST ASSIGNMENT AND TRANSFER
6
377417v3 JBD RE125-1
~ -3~
Section 7.1 Representation as to Redevelopment. The Buyer represents and agrees
that its undertakings pursuant to the Agreement, are for the purpose of development of the
Property and not for speculation in land holding. The Buyer further recognizes that, in view of
the importance of the Development to the general welfare of Richfield and the substantial
financing and other public aids that have been made available by the HRA for the purpose of
making the Development possible, the qualification and identity of the Buyer are of particular
concern to the HRA. The Buyer further recognizes that it is because of such qualifications and
identity that the HRA is entering into this Agreement, and, in so doing, is further willing to rely
on the representations and undertakings of the Buyer for the faithful performance of all
undertakings and covenants agreed by the Buyer to be performed.
Section 7.2 Prohibition Against Transfer of Property and Assignment of
Agreement. For the reasons set out in Section 7.1 of this Agreement, the Buyer represents and
agrees that prior to the issuance of the Certificate of Completion by the HRA:
(a) Except only by way of security for, and only for the purpose of obtaining
financing necessary to enable the Buyer or any successor in interest to the Property, or any part
thereof, to perform its obligations with respect to the Development under this Agreement, and
any other purpose authorized by this Agreement, the Buyer, except as so authorized, has not
made or created, and that it will not make or create, or suffer to be made or created, any total or
partial sale, assignment, conveyance, or any trust in respect to this Agreement or the Property or
any part thereof or any interest therein, or any contract or agreement to do any of the same,
without the prior written approval of the HRA.
ARTICLE VIII.
EVENTS OF DEFAULT
Section 8.1 Events of Default Defined. The following shall be deemed Events of
Default under this Agreement and the term shall mean, whenever it is used in this Agreement,
unless the context otherwise provides, any one or more of the following events:
(a) Failure by the Buyer to pay when due the payments required to be paid or secured
under any provision of this Agreement;
(b) Failure by the Buyer to observe and substantially perform any covenant,
condition, obligation or agreement on its part to be observed or performed hereunder, including
the time for such performance;
(c) If the Buyer shall admit in writing its inability to pay its debts generally as they
become due, or shall file a petition in bankruptcy, or shall make an assignment for the benefit of
its creditors, or shall consent to the appointment of a receiver of itself or of the whole or any
substantial part of the Property;
(d) If the Buyer, on a petition in bankruptcy filed against it, be adjudicated as
bankrupt, or a court of competent jurisdiction shall enter an order of decree appointing, without
7
377~}17v3 JBD RE125-1
Co - 3$
the consent of the Buyer, a receiver of the Buyer or of the whole or substantially all of its
property, or approve a petition filed against the Buyer seeking reorganization or arrangement of
the Buyer under the federal bankruptcy laws, and such adjudication, order or decree shall not be
vacated or set aside or stayed within 60 days from the date of entry thereof; or
(e) If the Development is in default under any Mortgage and has not entered into a
work-out agreement with the Mortgagee.
Section 8.2 Remedies on Default. Whenever any Event of Default occurs, the HItA
may, in addition to any other remedies or rights given the HRA under this Agreement, take any
one or more of the following actions following written notice by the HRA to the Buyer as
provided in Section 9.5 of this Agreement:
(a) suspend its performance under this Agreement until it receives assurances from the
Buyer, deemed reasonably adequate by the HRA, that the Buyer will cure its default and continue
its performance under this Agreement;
(b) cancel or rescind this Agreement;
(c) declare the Note immediately due and payable in full;
(d) foreclose on the Mortgage;
(e) withhold the Certificate of Completion; or
(f) take whatever action at law or in equity may appear necessary or desirable to the HRA
to enforce performance and observance of any obligation, agreement, or covenant of the Buyer
under this Agreement; provided, however, that any exercise by the HRA of its rights or remedies
hereunder shall always be subject to and limited by, and shall not defeat, render invalid or limit
in any way (a) the lien of any Mortgage authorized by this Agreement and (b) any rights or
interest provided in this Agreement for the protection of the Holders of a Mortgage; and provided
further that should any Mortgagee succeed by foreclosure of the Mortgage or deed in lieu thereof
to the Buyer's interest in the Property, it shall, notwithstanding the foregoing, be obligated to
perform the obligations of the Buyer under this Agreement to the extent that the same have not
therefore been performed by the Buyer.
Section 8.3 No Remedy Exclusive. No remedy herein conferred upon or reserved to the
HRA is intended to be exclusive of any other available remedy or remedies, but each and every
such remedy shall be cumulative and shall be in addition to every other remedy given under this
Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to
exercise any right or power accruing upon any default shall impair any such right or power or
shall be construed to be a waiver thereof, but any such right and power may be exercised from
time to time and as often as may be deemed expedient. In order to entitle the HRA or the Buyer
to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such
notice as may be required in this Article VIII.
8
377417v3 JBD RE125-1
(~-3q
Section 8.4 No Additional Waiver Implied by One Waiver. In the event of the
occurrence of any Event of Default by either party, which Event of Default is thereafter waived
by the other party, such waiver shall be limited to the particular Event of Default so waived and
shall not be deemed to waive any other concurrent, previous or subsequent Event of Default.
ARTICLE IX.
ADDITIONAL PROVISIONS
Section 9.1 Conflict of Interests; Representatives Not Individually Liable. No HRA
officer who is authorized to take part in any manner in making this Agreement in his or her
official capacity shall voluntarily have a personal financial interest in this Agreement or benefit
financially there from. No member, official, or employee of the HRA shall be personally liable
to the Buyer, or any successor in interest, for any Event of Default by the HRA or for any amount
which may become due to the Buyer or successor or on any obligations under the terms of this
Agreement.
Section 9.2 Non-Discrimination. The provisions of Minnesota Statutes Section 181.59,
which relate to civil rights and non-discrimination, and any affirmative action program of the
City shall be considered a part of this Agreement and binding on the Buyer as though fully set
forth herein.
Section 9.3 Notices and Demands. Except as otherwise expressly provided in this
Agreement, a notice, demand or other communication under this Agreement by either party to the
other shall be sufficiently given or delivered if it is sent by mail, postage prepared, return receipt
requested or delivered personally:
(a) As to the HRA:
Richfield HRA
Executive Director
6700 Portland Avenue South
Richfield, MN 55423
(b) As to the Buyer:
or at such other address with respect to either such party as that party may, from time to time,
designate in writing and forward to the other as provided in this Section 9.3.
Section 9.4 Counterparts. This Agreement may be simultaneously executed in any
number of counterparts, all of which shall constitute one and the same instrument.
9
377417v3 JBD RL125-1
Co' ~°
IN WITNESS WHEREOF, the HRA has caused this Agreement to be duly executed in
its name and behalf and its seal to be hereunto duly affixed and the Buyer has caused this
Agreement to be duly executed as of the day and year first above written.
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
RICHFIELD, MINNESOTA
By
Its Chairperson
By
Its Executive Director
Buyer
10
37741 h9 JBD RE 125-1
~-u~
STATE OF MINNESOTA
COUNTY OF
SS
The foregoing instrument was acknowledged before me this day of
20 , by ,the Chairperson of the Housing and
Redevelopment Authority in and for the City of Richfield, Minnesota (HRA), a public body
corporate and politic under the laws of Minnesota, on behalf of the HRA.
STATE OF MINNESOTA
COUNTY OF
Notary Public
SS
The foregoing instrument was acknowledged before me this day of
20 , by ,the Executive Director of the Housing
and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA), a public body
corporate and politic under the laws of Minnesota, on behalf of the HRA.
Notary Public
STATE OF MINNESOTA
COUNTY OF
SS
The foregoing instrument was acknowledged before me this
20 , by
day of
Notary Public
11
377417v3 JBD RE12~-]
~ - u~.
EXHIBIT A
FORM OF CERTIFICATE OF COMPLETION
The undersigned hereby certifies that ,has fully and
completely complied with its obligations under Article IV of that document entitled ``Contract for
Private Development", between the Housing and Redevelopment Authority in and for the City of
Richfield, Minnesota and dated ,
filed as Document No. with respect
to the construction of the approved construction plans at ,legally
described as and is released and forever discharged from its
obligations to construct under such above-referenced Article.
DATED:
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
RICHFIELD
sy:
Its: Chairperson
By:
Its: Executive Director
STATE OF MINNESOTA )
SS
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this day of
20, by and
the Chairperson and Executive Director of the Housing and Redevelopment Authority in and for
the City of Richfield, a public body corporate and politic under the laws of the State of
Minnesota on behalf of the public body corporate and politic.
Notary Public
This instrument was drafted by:
Kennedy & Graven, Chartered
470 U.S. Bank Plaza
200 South Sixth Street
Minneapolis, MN 55402
A-1
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EXHIBIT B
PROGRAM GUIDELINES -LOT SALE PROGRAM
[To be added]
B-1
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EXHIBIT C
QUIT CLAIM DEED
[TO BE ADDED]
G1
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EXHIBIT D
NOTE AND MORTGAGE
f TO BE SUPPLIEDI
C-2
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D-1