Loading...
08-16-99 agendaCITY OF RIC~°IFIELD MONDAY, AUGUST 16,1999 REGULAR HOUSING AND REDEVELOPMENT AUTHORITY MEETING RICHFIELD CITY HALL COUNCIL CHAMBERS 7 P.M. AGENDA CALL TO ORDER APPROVAL OF MINUTES OF REGULAR HRA MEETING OF JULY 27, 1999 1. OPPORTUNITY FOR CITIZENS TO ADDRESS THE HRA ON ITEMS NOT ON THE AGENDA 2. CONSIDERATION OF AMENDMENT TO CONTRACT FOR PRIVATE REDEVELOPMENT WITH CSM PROPERTIES, INC. FOR DEVELOPMENT OF INTERCHANGE WEST AND ASSOCIATED "BUT FOR" ANALYSIS HRA LETTER N0.46 3. CONSIDERATION OF AMOUNT AND FORM OF PUBLIC ASSISTANCE TO BE USED FOR COMPLETION OF LYNDALE GATEWAY DEVELOPMENT HRA LETTER N0.47 4. PUBLIC HEARING AND CONSIDERATION OF RESOLUTION AUTHORIZING SALE OF 7520 COLFAX AVENUE TO STEVEN MARLIN GRANT HOMES, INC. HRA LETTER N0.48 e, ,,, . <. . 5. PUBLIC HEARING AND CONSIDERATION OF RESOLUTION AUTHORIZING SALE OF 6600 OAKLAND AVENUE TO CORNERSTONE ADVOCACY SERVICE FOR TRANSITIONAL HOUSING PROGRAM HRA LETTER N0.49 6. CONSIDERATION OF RESOLUTION AUTHORIZING ACQUISITION OF 6901- 12TH AVENUE, 6929 QUEEN AVENUE AND 6933 QUEEN AVENUE UNDER RICHFIELD REDISCOVERED PROGRAM, AND RESOLUTION AUTHORIZING EMINENT DOMAIN PROCEEDINGS TO ACQUIRE 6933 QUEEN AVENUE HRA LETTER N0.50 7. CONSIDERATION OF AUTHORIZATION OF FOUR YEAR FUNDING PLAN FOR RICHFIELD REDISCOVERED AND TRANSFORMATION HOMES PROGRAMS AND REQUEST FOR CITY COUNCIL TO AUTHORIZE SALE OF GENERAL OBLIGATION TAX INCREMENT REVENUE BONDS HRA LETTER NO. 51 8. CONSIDERATION OF RESOLUTION AUTHORIZING EXECUTION OF CERTIFICATE OF COMPLETION FOR MERIDIAN CROSSINGS, PHASE II ., HRA LETTER N0.52 9. CONSIDERATION OF ACKNOWLEDGEMENT AND CONSENT TO TRANSFER PROPERTY FROM MERIDIAN PROPERTIES REAL ESTATE DEVELOPMENT L.L.C. D/BIA TOLD DEVELOPMENT COMPANY TO THE STATE TEACHERS RETIREMENT SYSTEM OF OHIO; MERIDIAN CROSSINGS OFFICE REDEVELOPMENT PROJECT, PHASE II HRA LETTER N0.53 10. CONSIDERATION OF RESOLUTION APPROVING PROPOSED 2000 HRA BUDGET AND CERTIFYING 2000 TAX LEVY AND RESOLUTION REVISING 1999 HRA BUDGET HRA LETTER N0.54 11. EXECUTIVE DIRECTOR REPORT 12. 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 ADMINISTRATIVE SERVICES DIRECTOR AT 612-861-9702. Aug~t 1999 City of Richfield ..... .. -. .. .. 7:00 PM City Council Study Session NATIONAL NIGHT OUT 7:00 PM Charter Commission :30 PM FOWL Board mcludin~ annual meeting with the riendship City Commission) 7:00 PM Human Rights Commission Meeting C~ wood Cake Nature Center 7:00 PM City Council s~ Meeting 7:00 PM Community ~ Services Commissi 6:00 PM Special City Council 3:30 PM Special City Council on Meeting Meeting @ City Hall One Meridian Crossing Office ~uilding Lobby 7;30 AM SATURDAY, 8/14 S cial City Council M i eet ng @ City Hall 5:00 PM RCHSPC 7:00 PM Friendship City ~ 7:00 PM HRA Meeting Commission ~ ri 7:00 PM City Council 7:00 PM Mayors Hour 7:00 PM Special City Council ~, Meeting 7:00 PM Planning Meeting Commission MTWTFS S MTWTFS S 1 2 3 4 1 2 3 4 3 5 6 7 8 9 10 it 6 7 8 9 10 11 12 12 13 14 15 16 17 18 13 14 !S 16 17 18 !9 19 ZO 21 22 23 24 23 20 21 22 23 24 23 26 Z6 27 28 29 30 3! 27 28 29 30 Printed by Calendar Creator Plug on $/5199 HOUSING AND REDEVELOPMENT P AUTHORITY MEETING MINUTES Richfield, Minnesota Regular Meeting July 27, 1999 CALL .TQ ORDER:<~_ ;~ ~ r~-: +. The meeting was called to order by Chair Harms a# 7:00 p.m. ROLL CALL HRA Members Present: Thomas Harms; Joan Helmberger; Michael Sandahl and Russ Susag. Michael Sandahl .arrived at 7:03 p.m. HRA Members Not Present: Kristal Stokes. Staff Present. Steven Devich, Acting Executive Director, Thomas Ferber, City Clerk; Bruce Palmborg, Community Development Director; Jon Starks, Community Development Manager; and John Dean, City Attorney. APPROVAL OF MINUTES M/Susag, S/Hetmberger to aaarove the minutes of the June 21 1999 HRA Meeting. Motion carried 3-0. HRA Meeting Minutes -2- July 27, 1999 • Evidence that CSM has met with impacted Interchange West residents and is prepared to present a plan to address their concerns caused by the delay in closing. • A schedule setting the completion date for each of the specified steps necessary for progressing with the redevelopment. • A letter acknowledging that failure to meet the completion date for any of the steps in the schedule may result in a termination of the Contract for Private Development with CSM for the redevelopment of Interchange West. Chair Harms stated that CSM had submitted the letter acknowledging that failure to meet the completion date for any of the steps in the schedule that they submitted may result in a termination of the Contract for Private Development with CSM for the redevelopment of Interchange West. Murray Komberg, Vice President of CSM Properties, Inc., discussed how CSM had responded to the three requirements. He described the five block meetings with property owners and other efforts to meet with residents. He stated CSM would renegotiate purchase agreements with property owners one on one to address each individual circumstance. He stated contingency removal would occur in December 31, 1999, with closings in April 15, 2000. He submitted a petition to the HRA signed by 37 homeowners, two thirds of those who attended the block meetings, supporting CSM to continue as the developer of the project. Mr. Kornberg submitted the following Interchange West Redevelopment Schedule: Meet with homeowners prior to HRA 7/27/99 meeting July 20, 1999 HRA consideration of "But For" Analysis August 16, 1999 Submit ISP Application August 31, 1.999 Submit draft EAW for staff review October 13, 1999 Submit Rezoning Application October 15, 1999 Submit CUP Application October 15,1999 No one wished to address the HRA. Acting Executive Director Devich reviewed HRA Letter No. 38 regarding consideration of a report from CSM Properties, Inc. regarding their proposal for _ continuation of the Interchange West Redevelopment Project stating that the HRA had deferred action until this meeting at which CSM was to provide the following: HRA Meeting Minutes -3- July 27, 1999 Submit FDP Application Administrative Review Committee Staff submittal of EAW to EQB EAW comment period begins First Reading -rezoning Planning Commission -zoning/CUP/FDP EAW comment period ends City Council final approval of rezoning/ CUP/FDP/EAW negative declaration (Special .meeting) Issuance of purchase offers to residential owners III commence immediately after 7/27 Hearing) Acceptance of residential purchase offers Issuance of purchase offers to commercial owners (Several already issued) Acceptance of commercial purchase offers Sale/leasing of new residential redevelopment Sale/leasing of new commercial redevelopment Satisfaction/waiver of conditions to purchase agreements Request for HRA land acquisition through eminent domain (Commercial and Residential Property) Notice of eligibility for relocation benefits Closing (subject to satisfaction of conditions) October 15, 1999 October 20, 1999 October..25, 1999 November 1, 1999 November 8, 1999 November 23, 1999 December 1, 1999 December 13, 1999 continuing through 12/31/99 continuing through 12/31/99 continuing through 12/31/99 continuing through 12/31/99 continuing through 12/31/99 continuing through 12/31/99 December 31, 1999 First HRA hearing in January, 2000 January 15, 2000, or one day after first HRA hearing in January, 2000 April 20, 2000 or 90 days after relocation notice Mr. Komberg reiterated that CSM had also submitted a letter acknowledging that failure to meet the completion date for any of the steps in the schedule may cause the termination of CSM's contract. He stated that CSM has no signed commitments yet for the commercial space as marketing continues. He stated Ron Clark and Rottlund are the townhouse developers. Mr. Komberg stated a commitment to communication with residents and the HRA. He requested that HRA authorize staff to amend the Contract for Private Development to allow CSM the additional time to complete the site assembly activities. Jim Bergin, 7627 Oliver Avenue, stated concerns about whether CSM would go through with its commitments to go forward with the project and the purchase of houses. He stated that if Mr. Kornberg is so certain the project will occur, the risk should be more on CSM than the residents and more money should be given to the residents as a result of their property being tied up for two years. Terry Ahlstrom, 7600 Morgan Avenue, stated concern that the redevelopment risk has become the residents and that CSM should show evidence that the same situation will not occur at the end of December. HRA Meeting Minutes -4- July 27, 1999 Lorraine Schreyer, owner of 7615 Morgan Avenue, discussed the physical, mental and emotional impact of the uncertainty regarding the purchase of their homes. She ,. appealed to the HRA to ask the City Council to buy out the homes. Ron Matheson, 7649 Penn Avenue, stated concerns about the impact on the residents indicating the following: • Houses would be very difficult to sell because of the uncertainty. • Some have let past the time for insurance recoverable damage from last years storms. • Some have purchased other homes because they trusted CSM, the HRA and the City. • Redevelopmen# is likely to occur and it should proceed as fast as possible. • The December 31 date must be adhered to. • CSM should give $10,000 earnest money instead of $5,000. • CSM should be flexible on the closings. Kevin Anderson, 7644-46 Logan Avenue, asked that the HRA ask that the City Council provide assistance to homeowners such as forgiving the second half of 1999 property taxes. He stated homeowners were in a difficult position and there seems to be few alternatives. He requested better communications from the HRA, staff and CSM. Wally McCarthy, owner of McCarthy's Oldsmobile car dealership, stated that CSM appears not to be in a position to go ahead, but that CSM is a good developer. He stated the car dealership is not for sale and it would have to be taken by condemnation. He stated the HRA should ask how the City would benefit from the project. He stated it is important to know if it will happen, so that if the dealership remains it will be cleaned up or to know it will close. Chair Harms stated Mr. Anderson was correct, that communications need to be better and that steps will be taken to improve them. He stated the City does not have the money to buy out all the homes nor the authority to forgive property taxes since the majority of those taxes go to other jurisdictions such as the school district and Hennepin County. He stated that he would propose to the HRA and make a motion that the HRA grant CSM the extension based on the schedule presented with the following condition: That the extension with CSM be on a nonexclusive basis. He stated that if another developer could demonstrate that they could complete the redevelopment faster and better than CSM, then the HRA could award that developer the project. Mr. Kornberg stated concerns that fair, objective criteria be used to evaluate any proposal. Discussion followed regarding the non-exclusivity issue and the development of objective criteria in the best interests of residents and the HRA. HRA Meeting Minutes -5- July 27, 1999 M/Harms, S/Susag to grant CSM an extension based on the Interchange West Redevelopment Schedule submitted by CSM with the followin4 two conditions: 1. That a clause be added to the agreement providing a clear termination clause by failure to meet any of the timetables in the schedule. 2. That the Redevelopment Agreement be made nonexclusive based upon the HRA's right to consider and act upon a proposal by another developer which meets certain criteria establishing that it is a development proposal better for the community and better for the residents and that staff develop these criteria to put into the text of the agreement. Discussion of the motion followed. Chair Harms stated that in general teens the criteria may include such things as: • Qualifications and experience of the developer • Value of the project • Timing • Impact on the neighbors • Enhanced value over CSM's proposal • Does the new developer take into consideration and resolve economic hardships created upon the sub-developers Rottlund Homes and Ron Clark Construction for preapproval development costs Commissioner Sandahl stated he wished some things had been done differently, but there is no good answer to solve each individuals problem. He stated that the proposal to allow CSM to move forward would have the least negative impact for the most people, knowing that this is not the-best solution for everyone. Commissioner Susag stated if there was another developer ready to go he would support them, but this is not the case so he would support Mr. Harms motion. Ernie Lindstrom, 7604 Fremont Avenue, asked for clarification on the status of the purchase agreements previously negotiated by CSM with homeowners. Chair Harms stated they expired and are no longer valid. Sherri Keep, 7643 Newton Avenue, asked questions about the guarantees for developers to perform. Cindy Triggs, 7639 Penn Avenue, stated conoems that CSM would not commit to taking into consideration the financial hardship caused by delays. Mr. Kornberg stated that each case would be dealt with on a case by case basis and hardship cases would be considered. Barb Gresbrink, 7609 Oliver Avenue, suggested that the definition of hardship include medical conditions caused by stress. HRA Meeting Minutes -6- July 27, 1999 Kevin Anderson, 7644-46 Logan Avenue, stated that the HRA required minimum standards for the developer, but that he would like to see minimum requirements for the HRA and City to communicate to homeowners. Chair Harms stated this was not an unreasonable request and better communications mechanisms will be developed. Bob Guthe, 7634 Oliver Avenue, stated that CSM did not have too much trouble getting the purchase agreements for the residential property, but the real problem is getting the commercial property first. Ron Matheson, 7649 Penn Avenue, stated concern about how things would work if a homeowner signed a purchase agreement with CSM and then another developer was chosen. Dave Bakke, 7601 Morgan Avenue, suggested that CSM pay anon-refundable down payment to the homeowners. Discussion followed regarding eminent domain issues and processes and how they relate to .this type of project: Tom Haley, 7620 Oliver Avenue, asked how long until the criteria would be developed and available. Chair Harms stated HRA Attorney Dean would have them prepared shortly and present them to the HRA at their next meeting. Pat O'Brien, a business owner in the 76~' Street and Lyndale Avenue area, criticized the HRA for allowing so many delays and putting the people at risk. Commissioner Helmberger stated support for Mr. Harms motion and developing clear criteria. Chair Harms called for a vote on the motion before the HRA. Motion carved 4-0. Chair Harms directed Acting Executive Director Devich to develop a communications plan including the ombudsperson. Chair Harms called for afive-minute recess at 8:40 p.m. and reconvened the meeting at 8:45 p.m. HRA Meeting Minutes -7- July 27, 1999 Acting Executive Director Devich reviewed HRA Letter No. 39 regarding a staff recommendation that an advisory committee be implemented to recommend policy regarding replacement of affordable housing in a manner consistent with the City's adopted Livable Communities housing goals, the Comprehensive Plan and the Mitigation Plan. M/Sandahl, S/Helmberger appoint an advisory committee to recommend policy regarding replacement of affordable housing with the following conditions: 1. The Richfield Community Council will facilitate the process for securing members from the following organizations: • League of Women Voters • Familink • Richfield Public Schools • Community Churches • City Council • HRA • Richfield Apartment Management Association • Community Development Department • Public Safety Department 2. Meetings shall be facilitated by Jeanne Massey from the South Hennepin Human Service Agency (SHERPA~. 3. The policy recommendations shall be completed by December 31 1999 for presentation to the HRA at their January 17 2000 meeting. 4. The cost of formulating the recommendations shall not exceed $5 000 (Ryan Companies. U.S. will reimburse the HRA for the cost.) 5. The Chair and Acting Executive Director are authorized and directed to sign an agreement effectuatingthis relationship with SHERPA. Motion carried 4-0. HRA Meeting Minutes -8- July 27, 1999 M/Sandahl, S/Susag to close the public hearing. Motion carried 4-0. M/Helmberger, S/Sandahl that the following HRA resolution be adopted. that it be spread in the HRA resolution book and that it be made part of these minutes: HRA RESOLUTION N0.718 RESOLUTION AUTHORIZING THE SALE OF REAL PROPERTY LOCATED AT 506 EAST 67TH STREET TO RICKY-A. GARLAND AND ANN L. GARLAND Motion carried 4-0. This HRA Resolution appears as HRA Resolution No. 718 in HRA Resolution Book No. 6 Sid Inman, Ehlers/Publicorp, Inc., responded to questions from Commissioner Susag regarding City Council actions required authorizing the bond sate indicating that there is no statutory requirement for a public hearing for this type of bond. Commissioner Susag stated that in the spirit of the City Charter provisions regarding public hearings, on capital improvement expenditures, the City Council should conduct a public hearing regarding this bond sale. Acting Executive Director Devich stated this would be done. Acting Executive Director Devich reviewed HRA Letter No. 40 regarding the proposed sale of the property at 506 East 67~' Street to Ricky A. and Ann L. Garland for $2,100. Acting Executive Director Devich reviewed HRA Letter No. 41 regarding a proposed Richfield Rediscovered and Transformation Homes Program funding plan and a request that the City Council authorize the sale of general obligation tax increment revenue bonds. HRA Meeting Minutes -9- July 27, 1999 Discussion followed regarding when the funding for the bond sale would become available for the Transformation Homes Program. M/Sandahl, S/Helmberger to authorize the twayear Richfield Rediscovered and Transformation Homes Program funding plan. requesting the City Council to authorize the sale of general obligation tax increment revenue bonds and authorize the HRA Chair and Acting Executive Director to execute agreements related to the funding plan for the Richfield Rediscovered and Transformation Homes Programs. Motion carried 4-0. Rob Smolund, the Enterprise Facilitator, reviewed and answered questions regarding the Richfield Enterprise Facilitation Program mission statement, process flow chart and activity report. Julianne Manship, Coordinator of the Community Apartment Program, reviewed and answered questions regarding the following program elements: • Richfield Apartment Managers' Association (RAMA) • FOYER Program • Livable Community Team • Collaborations • Library Pilot Project for Hispanic Children Acting Executive Director Devich reviewed HRA Letter No. 42 regarding the Richfield Enterprise Facilitation Program. Acting Executive Director Devich reviewed HRA Letter No. 43 regarding the Community Apartment Program. HRA Meeting Minutes -10- July 27, 1999 M/Sandahl, S/Susag that the following HRA resolution be adopted. that it be spread in the HRA resolution book and that it be made part of these minutes: HRA RESOLUTION N0.719 RESOLUTION AUTHORIZING EXECUTION OF A CERTIFICATE OF COMPLETION FOR THE GALYAN'S TRADING COMPANY RETAIL STORE REDEVELOPMENT PROJECT • Motion carried 4-0. This HRA Resolution appears as HRA Resolution No. 719 in HRA Resolution Book No. 6. - M/Sandahl, S/Helmberger that the following HRA resolution be adopted. that it be spread in the HRA resolution book and that it be made part of these minutes: HRA RESOLUTION N0.720 RESOLUTION AFFIRMING MUNICIPAL TORT LIABILITY LIMITS ESTABLISHED BY MINNESOTA STATUTES 466.04 Motion carried 4-0. This HRA Resolution appears as HRA Resolution No. 720 in HRA Resolution Book No. 6. Acting Executive Director Devich. reviewed HRA Letter No. 44 regarding a request for issuance of a Certificate of Completion for the Galyan's Trading Company retail store redevelopment project. Acting Executive Director Devich reviewed HRA Letter No. 45 regarding consideration of a resolution afFrming the Municipal Tort Liability limits established by Minnesota Statutes 466.04. HRA Meeting Minutes -11- July 27, 1999 None. FIRSTAR BANK Section 8 Checks: 13877 -13990 HRA Checks: 20759 - 20766; 20884 - 20938 Motion carried 4-0. ADJOURNMENT ~. ''>~r. $133,738.64 $170,208.06 The meeting was adjourned by unanimous consent at 9:13 p.m. Date Approved: Thomas P. Ferber City Clerk Thomas E. Harms Chair Steven L. Devich Acting Executive Director HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 46 Agenda August 16, 1999 Issue Statement: Consideration of an amendment to the Contract for Private Redevelopment with CSM Properties, Inc. for the development of Interchange West and consideration of the associated "but for" analysis. Background: On December 21, 1998 the Richfield Housing and Redevelopment Authority (HRA) accepted a Contract for Private Redevelopment (Contract} with CSM Properties, Inc. (CSM) for the development of the Interchange West area. Delays in the project, however, rendered the development in non-compliance with the Contract. At the July 27 meeting, the HRA directed staff to draft an amendment to the Contract based on the schedule which CSM had provided. As part of this direction to staff, the HRA spec'~fied that the Contract was to be amended in a manner that establishes criteria for other interested developers to propose and for the HRA to consider alternative development concepts. Staff has since drafted a preliminary version of the contract amendment. The preliminary version was sent to CSM on August 3 for their review. The proposed amendment establishes the schedule for the developer to address the unresolved issues from the original contract. The draft amendment also specifies the conditions under which the agreement would become an exclusive one with CSM and establishes the requirements for the consideration of other proposals as well as the criteria for evaluating such proposals.. The final version of this amendment is being negotiated and will be presented to the HRA at the August 16 meeting. The "but for" analysis which establishes the amount of tax increment financing (TIF) assistance to be provided for the development is currently being completed and will be presented to the HRA at the August 16 meeting. Recommended Motion: Adopt a motion which: 1. Accepts the amendment, as presented, to the Contract for Private Redevelopment with CSM for the Interchange West area; and 2. Approves the amount of TIF assistance as presented in the "but for" analysis. Basis of Recommendation: 1. CSM is currently not in compliance with the Contract for Private Redevelopment. 2. At the July 27 meeting, the HRA directed staff to draft an amendment to the Contract which addresses the manner and schedule for completing the unresolved issues from the existing contract and which establishes the manner for the consideration of other proposals. 3. Staff has drafted the amendment as directed, and the final version will be presented to the HRA at the August 16 meeting. 4. As outlined in the schedule contained in the draft amendment, CSM will be presenting the "but for" analysis at the August 16 meeting for HRA consideration. Alternative R®commendations: 1. Do not accept the terms of the proposed amendment and terminate the contract with CSM. 2. Do not approve the amount of TIF assistance as presented in the "but for" analysis. 3. Consider the information presented on the contract amendment and "but for" analysis, but defer action until the September 20 HRA meeting. Discussion/Decision Mod®: Murray Komberg of CSM will be present at the meeting to discuss the contract amendment and "but for" analysis. _ _ R e tfully subm' d, L. Devic Acting Executive Director -- SLD:cak HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 47 Agenda August 16, 1999 Issue Statement: Consideration of the amount and form of public assistance to be used for the completion of the Lyndale Gateway development. Background: On January 19, the Richfield Housing and Redevelopment Authority (HRA) approved a Contract for Private Redevelopment with CSM Properties, Inc. (CSM) for the redevelopment of the Lyndale Gateway area. In April, the HRA approved CSM's concept plan for the area which included Lyndale Avenue, the east side of Aldrich Avenue and the west side of Garfield Avenue between 76th and 77th Streets. The proposal on the west side of Lyndale Avenue included a mix of retail and office uses, while. the primary use proposed on the east side of Lyndale was a senior complex with 152 units plus office space. Property owners on the east side of Gafield Avenue had expressed concern regarding the potential impact of the development on their properties. In an effort to address these concerns, CSM resubmitted their concept plan in June to include the acquisition of those homes and the construction of townhomes on the site. When the HRA selected the CSM concept as the preferred proposal for Lyndale Gateway at the November 16, 1998 meeting, a significant "gap" in the financing was identified. The gap consists of site assembly costs which exceed the increment to be generated by the development. At that time the gap was estimated at approximately $3 million. Since that time, staff has worked with CSM and Ehlers and Associates, Inc. (Ehlers) in determining whether that gap could be reduced or eliminated. CSM was able to eliminate approximately $700,000 from the development costs by making changes to the site plan for the development which they had originally proposed and by making changes to their financial structuring of the development. Unfortunately, however, staff from Ehlers continue to estimate a $1.9 million gap in the overall development. A summary and brief financial analysis of each component are as follows: Senior Apartments & Office Development Twin City Christian Homes (TCCH) has been identified as the sub-developer of this site, which is on the east side of Lyndale Avenue extending back to include the property on the west side of Gafield Avenue. The apartment portion of the development will contain 152 units. TCCH has stated that at least 40% of the units would be offered at a reduced rent in order to provide "affordable" housing. The tenants of the 35,000 sq. ft. office portion of the TCCH development have been identified as Tushie-Montgomery Architects, Weiss Builders and the offices of Twin City Christian Homes. Ehlers staff have concluded that this development generates sufficient tax increment to offset the site assembly costs; therefore, there is no gap on this component of the development. Retail & Professional Office Development This portion of the development is located on the west side of Lyndale Avenue and would extend back to the east side of Aldrich Avenue. CSM intends on developing this portion of the development. CSM continues to show afree-standing drug store and a second building containing a dental office, a retail store space and four smaller retail spaces. CSM has been in discussion with the primary tenants, but does not yet have any signed commitments to lease any of the space. Ehlers staff have estimated a $1.3 million gap on this component. The primary reason for the large gap is due to the high site assembly costs, including the relocation of 17 businesses. Past proposals and current analysis of the west side of Lyndale Avenue indicate that this gap cannot be reduced further. Townhome Development This portion of the development was planned in response to the concerns of the homeowners on the east side of Garfield Avenue regarding their perceived negative impact on their property by the TCCH senior apartment development. Ron Clark Homes has been identified as the sub-developer and builder of the townhomes. The concept plan which was approved in June showed 30 units on this site. Ron Clark Homes is now proposing 40 units. Staff, however, believes a 40 unit townhome development on this site is too intensive and is recommending that the development contain no more than 32 townhomes. With 32 units, the gap for this component of the development has been estimated as $621,000. When the concept for the townhomes was accepted, it was under the premise that they were self-sustaining and there was no gap. The townhomes would be priced at $129,000 to $149,000 each. Sid Inman of Ehlers has submitted a memorandum (Exhibit A) which analyzes the need for public financing necessary for this project to occur. This letter verifies that the development could not occur "but-for" the use of tax increment financing. In order for the development to proceed as a whole, additional sources of public funding must be identified. A potential source for this additional funding would be the increment generated from the Candlewood Hotel site. This site is conservatively estimated to generate $1.2 million in increment (present value) prior to the retirement of the TIF district in 2012. Even with the Candlewood tax increment, the entire project continues to have a gap of $722,000. A potential funding source for this remaining gap would be the development account which contains revenues from prior land sales, although use of development account funds in this amount would severely limit the administrative and project funding for redevelopment activities in the future. The method of utilizing the Candlewood increment which has been discussed would use the proceeds of City issued general obligation tax increment bonds to reimburse the developer for eligible redevelopment costs. The bonds would be retired using the increment from Candlewood and backed by a general obligation of the City in the event that there is insufficient increment for the debt service. Recommended Motion: Adopt a motion which: 1. Approves assistance only for the senior apartment and attached office development which is proposed for the east side of Lyndale Avenue and for the commercial development which is proposed for the west side of Lyndale Avenue; and, 2. Approves the use of tax increment financing (TIF) for the development in the approximate amount of $3,930,000 in the form of apay-as-you-go note issued to the developer(s) as reimbursement for eligible redevelopment costs; and; 3. Stipulates that the tax increment assigned to the Twin City Christian Homes . component of the development be reduced proportionately in any year that the debt service coverage exceeds 130%: 4. Requests that the City Council issue general obligation tax increment bonds in the approximate amount of $1,250,000 to be retired from the tax increment generated by the Candlewood Tax Increment Financing District, the proceeds of which would be reimbursed to the developer(s) for eligible redevelopment costs; 5. Approves the use of development account funds of up to $100,000 for reimbursement to the developer(s) for eligible redevelopment costs which exceed the amount of TIF and bond proceeds which are to be provided. Basis of Recommendation: 1. Lyndale Gateway has long been identified as an area in need of redevelopment activities. 2. The HRA approved a Contract for Private Redevelopment with CSM on January 19 for the redevelopment of the Lyndale Gateway Area. 3. The HRA approved a concept plan on June 21, 1999 which identified a senior apartment complex and attached office development on the east side of Lyndale Avenue, commercial development on the west side of Lyndale Avenue and townhome development on the east side of Garfield Avenue (under the premise that the development of the townhomes would not result in an additional gap). 4. A tax increment financing district and plan was established on June 14, 1999 to include the Lyndale Gateway area. 5. The HRA and staff have been aware since its initial proposal that the development did not generate a sufficient amount of increment to offset all of the site assembly costs and that additional forms of public assistance were probably necessary for this or any other development to occur in the Lyndale Gateway area. 6. The townhome development has a gap of nearly $700,000 and the only potential funding source for this gap is the development account. Use of development account funds in this amount would severely limit the administrative and project funding for redevelopment activities in the future, beginning in 2000. Alternative Recommendation: 1. Adopt a motion which approves the use of tax increment financing only for the senior apartment and attached office development which is proposed for the east side of Lyndale Avenue. This would not require additional public assistance beyond the tax increment which would be generated by the development. 2. Adopt a motion which approves the use of tax increment financing for the entire development including the 32 townhomes on the east side of Garfield Avenue. This would require approximately $1.9 million in additional assistance beyond the tax increment which would be generated by the development. In addition to the Candlewood general obligation tax increment bonds, this would also require the use of up to $700,000 of funds from the development account; this would severely limit the administrative and project funding for relocation activities in the future. 3. Adopt a motion which approves the use of tax increment financing only for the senior apartment and attached office development which is proposed for the east side of Lyndale Avenue and for the townhome development proposed for Garfield Avenue. This would require approximately $621,000 in additional assistance beyond the tax increment which would be generated by the development. 4. Adopt a motion which denies the use of tax increment financing for all components of the proposed development. 5. Defer a decision until the September 13 meeting. Discussion/Decision Mode: - 1. The denial of financial assistance for the townhomes on the east side of Garfield Avenue would cause a great deal of concern to the existing residents. While the developer has not made any formal offers on these properties, preliminary discussions have begun which have probably led to an expectation on their part that the developer will be purchasing their property. Recent sales records from throughout the city indicate that market interest in this area should continue to be strong. 2. Should the HRA approve the use of assistance for any portion of this development, there are still several issues which need to be addressed before the development could occur. Among these issues are the final commitment from the tenants of the drug store and the dental facility which have been proposed, and the approval of the Planned Unit Development, Conditional Use Permit and other City approvals. R e ully submi , to en L. D Bch Acting Executive Direc or SLD:cak Attachment FREERS & ASSOCIATES INC TO: Bruce Palmborg -City of Richfield John Stark -City of Richfield FROM: Sid Inman -Ehlers & Associates Mark Ruff -Ehlers & Associates DATE: August 12, 1999 MEMORANDUM RE: South Lyndale Project -But For Analysis As requested, we have completed the "but for" analysis for the south Lyndale project. The primary methodology for accomplishing this analysis included a review of all three developers' pro forma's. Additionally, we prepared indi-vidual tax increment cash flows to determine the amount of increment available for each project. The TCCH senior housing project is proposed to be financed by housing revenue bonds. The senior housing pro forma demonstrates that 90% of the expected tax increment from the senior housing units and the commercial development connected to the senior housing is, necessary to provide adequate coverage on the debt. Debt service coverage is a function of total revenues (including tax increment) less operating expenses divided by annual debt service. The typical debt service coverage for these types of financing are 115% to 120%, plus an allowance of 5% vacancy for the housing units. The expected coverage on the TCCH project is 118% in the first year and increasing as rents are inflated. Therefore, the 90% level of assistance is justified. We do recommend that the tax increment assistance be reduced or eliminated in any year ifthe debt service coverage is over 130%. This will allow TCCH some cash flow for reinvestment in the property and for affiliated programs while also ensuring that the tax increment provided is not excessive. Attached is a gap analysis chart for the CSM commercial project and the town home project. While our review indicated a need for the amount of tax increment requested, the district does not produce sufficient tax increment to fill the financing gap. The chart shows the amount of land acquisition cost, land sales income, tax increment income and the remaining gap. The present value of the tax increment for the commercial project over 25 years is $624,820 leaving a remaining gap of $1,300,180. The present value of the tax increment for the town house project over 25 years is $521,128 leaving a remaining gap of $621,452. One possibility for filling the gap for either the commercial or townhome project is to utilize the tax increment produced by the Candlewood development in the LHN district. -The first increment from this parcel is expected in 2000 in an annual amount of $186,000 for 12 years. CSM has indicated that it would not be willing to increase its pay-as-you-go note to finance the additional assistance. Therefore, the HRA is being requested by the developers to provide the assistance "up-front". The HRA has two choices for up-front assistance. The first is a tax increment revenue bond placed with a bank or underwriter. The City and HRA would have no financial obligation from sources other than the project tax increment for the revenue bond. We did contact the underwriter who is working with TCCH on financing parameters on a revenue bond. The assumptions for a revenue bond would provide funding for approximately $950,000 to $1,050,000 of net proceeds to cover the gap. In addition to the Candlewood increment, the underwriter also requested any increment above 130% for TCCH as additional security for the revenue bond. The other alternative would be for the HRA and the City to issue afar-exempt G.O. Tax Increment Bond. The G.O. Tax Increment Bond would provide funding for approximately $1,200,000 of gap financing. The reason that the G.O. bond is able to yield more than the revenue bond is due to three factors: ^ The G.O. carries an interest rate of .5% to .75% lower than a revenue bond due to the full faith and credit of the City behind the project. ^ The revenue bond would require 150% coverage while we would be comfortable recommending a 125% coverage for the G.O. ^ The revenue bond would require a one year debt service reserve while the G.O. would not require a one year debt service reserve. In summary, the TCCH project appears to be self-supporting with tax increment, and may not require all of the tax increment if vacancy levels are low in the future. The CSM commercial gap is approximately $1,300,000 and the townhome gap is approximately $622,000 for a total gap of $1,922,000. The Candlewood tax increment pledge could reduce the gap by from $950,000 to $1,200,000, to depending upon if the HRA and City are comfortable with the issuance of G.O. bonds. This would leave a net gap of from $722,000 to $972,000. The only other source of funds that are available to fill this gap would be cash . Please let us know if you have any other questions or comments. from the desks of: Sid Inman ~ Vice President Ehlers ~ Associates, Inc. 3060 Centre Point Drive Roseville, MN SS113 Phone: (6S1J 697-8507. Fax: (6S1) 697-8SSS c:~wnvnows~n~cAr-~oa...~a oe~lzrs9 City of Richfield - Lyndele Ave Project -BOTH SIDES Page 1 BASIC ASSUMPTIONS Oistria• New R~evelopmem Dletrla krflatton Rate 0000004 Pay As You Go Rate - Once -CSM o Pay As You Go Rate - OBice -TCCH 8.00 A Pey As You Go Rate -Apt Housing 0.000 0 Pay As You Go Rate -Town Homes g 75 Fiscal Dlap. Contribu tion RaBo g ~oA Fiscal Dtap. Contribution Ratio 17.176°~ 1999 Fiscal Disp. Contribution Ratio 18.176°~ 2000 Fuel Diap. Contribution Ratio 18.178% 2001 Fiscal Diap. Contribution Ratio 20.178°,6 2002 Tax Capacity (Extension) Rete - ARFJ1 WIDE RATE 22.178°~ 1,820000 2003 EST Tax Capacity (Extension) Rate -CITY RATE Tex Ce achy (Extension Rate -CITY RATE 1 515550 ~Rifiad 1.352800 2001 , BASE TAX CAPACITY CERTIFIED FROZEN _ BASE BASE PID MARKET PROPERTY TAX 33-028-24-44.0036 VALUE 168,000 TYPE 2.4°,G3.4°~ CAPACITY 4 212 7600 ' 33-028-24-44.0037 33-028-24.44-0038 174,000 2.4°~-3.4°~ . 4,416 7808-12 West-Lyn West-Lyn 33-028-244.0039 280,000 265,000 2.4%-3.4% 2.4°~t,-3 4°A 7,340 7 510 761418 7 West_Lyn 3328-2444-0080 33-028-2444.0041 109,000 . 2.4°.U-3.4% , 2,618 620-26 7632 Weat.Lyn WeaW,yn 33-0Z8-24~4-0p42 89,000 110 0 2.4°.63.4°,6 2 496 33 4° 6 2,138 7828 West-Lyn 33-028-244-0043 33.028-24.44-0Og4 , 101,000 . , . . 2.4°.6-3.4°.6 2,640 2,424 7630 7634-36 bleat-L yyast.Lyn 33-0z6.2a-44.0045 92,000 120,000 2.4%3.4°.6 2.4963.a°,G 2,208 2 880 7838-40 76 West-Lyn 33-028-2444.0046 CSM Sub-Total 118,000 2.4°.6.9.4°k , 2.832 42 7644 west-Lyn Walt-L IN DISTRICT 1251-ILN 34-028-24-33.0078 1,606,000 41,214 ' IN DISTRICT 1261-ILN 34.028-24-33-0077 122,000 2.40°.6 2,828 7601 East-L m IN DISTRICT 1261-ILN 34-028-24.33.0078 235,000 2.40°.6 5 ~ 9-11 7 East-Lyn 34.028-24-33-0084 ~ IN DISTRICT 1251-ILN 34-028-24-33-0074 315,000 ° 2.40°k 0 7,560 0 7615-27 East-Lyn ' TCCH Sub-Total 147,000 819;000 2.40° 3.528 7629-33 East-L 33.028-241t4.0056 33-028-24-04-0055 137,000 2.4°~.4% 18,656 3,288 7601 Aldrich 33-028-244.0054 89,200 82,000 2.4%3.4% 2.4%3.4°b 2,141 1 888 7609 7 /{Idr(q~ 33-028-24-44-0053 33-028-2444-0052 79,000 2.4%3.4°~ , 1,896 815 7821 Aldrich Aldrich 33-028-24-04.0051 87,580 87,000 2.4°~6-3.4°.G 2.4%3.4°A 2,102 2 088 7827 76 Aldrich 33-028-24-44.OOSp CSM Sub-Total 81,000 2.4963.4% , 1,944 33 7839 Aldrich Aldrich 34-028-2433-0065 34-028-2433-0068 642,780 84,000 2.40% 15,427 2.018 7600 W-Gerfleid 34-028-2433-0067 108,000 90 000 2.40°k 2 40% 2,582 7608 W-Garfield 34-028-2433-0068 , 103,091 . 2.40% 2,160 2,474 7614 7620 W-Gartield W-Garfi ld 34-028-2433-0069 34-028-24 33-0070 94,000 88 000 2.40% 24 ° 2,258 7626 e W-Garfield 34-028-2433-0071 , 105,000 0 .6 240% 2.064 X520 7632 76 W-Gerryeld TCCH Sub-Total 670,091 16 082 38 W-Gerfiekf i 34.028-2433-0059 x•000 1.96-1.65°A , 882 7639 E-Gerfteld 34-028-2433-0080 77.000 1.00°,6-1.65% 87 204 1 00%-1 85° 6 777 7833 E-Gartield 34-028-2433.OOG1 , . . . 84,OOp 1.00°.6-1.85odi 945 892 7627 7821 E-0arfleld 34-028-2433-0062 34-028.24-33.0063 82,000 1.00%-1.85°.6 859 781b E-Garfield E-GerHeld 34-028-24-3.4-0o6a 84.000 1.00%-1.65°k oc n.V. , . "-• 892 7609 - -- _ E-Garfield Texea an Apta Based on Market Value of 741,898 478,286 533,; Taxes on Townhomea Based on Market Value of 148,000 per Unit 2_~ Taxes on Townhomes Based on Market Value of 129,000 par Unit 1-Cer Phase ~ DevelapmeM Sq Ft Taxes Pe Total Taxes Tax Capcity Total Tax CSM TYPO . . Unite r S . FLNntt Including Fis. Dis. Minus Fis Dis Capacity Tax Market CSM j Retali - Retell -Drug Store 15 120 ~ ~ $4 50 0 . . 0 Rate 0 2.4°'6°3.4°.6 Value P CSM i C Reta1l - Other , 14,824 . $4.50 68,010 86 766 38,580 37 885 48,344 2.4963.4% 1,468,000 2002 SM ~ T Office Dentist 14,600 $5.00 _ , 72 508 , 41 141 47,460 2.4%3.4% 1,440,000 2002 CCH TCCH ~ OMt~ ~-EastLyn ~'~ 1 ~•~ . 178,825 , 100,334 51,540 2.4°A3.4% 125,694 2.4°k-3.4% - 1,560,000 3 741 000 2002 2002 TCCH Apts-East Lyn 08 52 $2,142.98 $1 000.28 231,443 52 014 171,072 34 171,072 2.40°,6 , , 7,128,000 2002 Ron Clark i Ron Clark Townhames Tawnhomea 8 , $2,857.77 , 21,262 ,320 15,716 34,320 1,OOe~6 15,7181.00°,6-1.65% 3,432,000 1 182 000 2002 2002 iTALS 24 $2,211.32 53,072 39,228 39,228 1.0096-1.85°~ , , a nos rvw erne RI100-26 Prepared by Ehlers Inc. -Please review all esaumptiana. csm99-a.WK4 r• . ? ea-?v ii&! 63+itk9i~} t~J ?~'«` k+rud9 itNlY P$f.~.~ I~a.~d~@&' F+l g , gq ~p~j . :~7!$!'i~ '-.ITI`.'6~ s:?3GI£~E t:kDe"~~ d3(~$~3~ 7f~~ FSJ7 ii$1'Sl~€7Q . PV ~Ut .dn A'Q6 •« rv?tA,l•b ~1$„~_ d~f E 9fesnittrsd aa~tl,t _ _, - ^~1'+?3. rS:-@i L3,C tC~£ ':-t"F? ~~~~ C ~~ t7 C C lt"7G~' "t~ 50 '1 !; L' n C ~? 4 ttr.'rr.ei '^! «" ~ tSt:i.4: ren.F~t !10 :"m:'1' lGdCt ~,(+ IPA-«7' bl~s,~ ;7 ~_, E riL'.5=: gt8,E+t• kt'.t!.t•' r~n,- .~.,..: !;".+3£ tf}eD ~J i e.M~n . £~'rS i.+J.`_'~ D.i Awtt.i ke8.c'°~~ frC~.6; n~B.uL At~.;•~ ALf.h+: C:5°~ a>otiS ?~'-bt1 e~ ' {p,~q °.r 7~";#,! ?td,~ +! {YSQ;ri ?C6~ b4S. u pi+2.Rt ['~,+? E'CtrS PD^Sd1 f} r l P~45i4 ~,5; At~s1.t ~ ~S~,Q: v {P'{E.k) ~ ArB.:J~ Rim We ~k'G.~d QQgiS +es.~ at P t.Q{+% 'C--FII~ ~.i ~-~5:+ AFAR C f!S~.£1 '~A.SE AY3.9r p-~$,t+s 6~G.) A Et1^~ fi.~ i ilS tt2•i'D O.F: ~+LQ.d 8t$i,~ 6 fP'iG,~l ~9,,MT r.EB$A &ti~..E$ C~'j3 Q"~' PCB ~S =S Ifl-?+J 9.£ Tt~t,.E $rdi55 +~ gt4C.~ .±~ AiEr.~s. A+°-it,s+?, 4??R:.~ dQ~ >t4.Yd.` OE ' ~Y' r~~e Qk ~'x~,t ~P&.tk5 Q gF4F.:~ dL~:?.~ Rl:.iip pP?,i-•+3 G:~:~ t..S ifi=~ ~ t: t:~;~ { ,?.r r~~: * skd.~ € gag~;tl ~~.~ ~«$!~a r~r~.ea od~:.~ ra+~~s . • ®s f~iv 0.8 ~:t+~+ Afc`.~°a` G (is/s•!SS .~ L.rA.RF ts6 %.Z s%EC,& ~~.,. tC-~'+9 E.A P d.a Pt~?E pPEf~s fl ;r~~..~ ~d~,~ r-PC.aA ?~!~3.aZ Prta~E sag r~sR~ G.B i tf~;Y+ lab t#s@•E APF.4~. Q {tS~s:i ,~ 4td,0t~ d+r~.p-~ ~,Q ~Ct~ ERA d.d - t~DS +~)~~ d.r :a:•.'~.' f-P$58: © (PEEN} dl'$,5S EIc3,6;- ~tm;&8 !'~£.;t ,~/;~ h~L4'g _ 6.A 4~''a-i !~-Se ps i=%_H.f AP,@,~ ~ . ;45~:,R. ;'~.;'~ d•IS,~A !_•'.+/-0.+°~^.. S~~#,sJ -t "~:P~, tti-n'"B ~ dy ~ l~7ofi rE-?u a.c a?-,.' ~rE.e~ EP !eS'K,~; ~.;~,~. ~azA„~ ~,~ ~ €aa:.~ rF~ eoau . t>'r - 5i3f,". EtrR 9-~ r->A~;: at::_ta 2 er;e';2} :+,&fr tu.ga. r ,;,' ~ g461S rtt~n Q~ `.1~F..t rd?B.Rk: P! )p`E,t;1 ~~,ir' ApQ.E~A d~,.t?' tIG6,i~ QfGS tp`'R3 08 . t+'~si ~ PBfi~ MJ•S~D Y;i °~E ~.a @B aCS,: « ^" $ P Dr~;,BC b d7 ~ f rCB~) P% ~,lw ?td,~+ k=.~.B 2~P.':9 - C?PfSa s~i3+'.Q 2_' 1 . , - P8,~5 !7 :^ig,Et ,4~ ~SR.EF9. p159;&9 62.f..8t Et~S t~-?,Q ft St 3 E ;. • Si + f 0 $ 'P 1 ~r ~ a.A~,s Atsl~ n Ptr,r.t { ~qp~q. .~i.*Lffi A~"'.t.[~-~u ~3.A~L.B. tl~,~ t+®~ ~~N~ ~.6 . ~ ~ y p iY Mf 1~ ~ ~ g i4'Y-+/ y .c.at th@~•P f.-F~.b~ C f 9 iE: r; ei~.$E PfS..E,~~A AOkl.r4) Ck°.E:.St d't@S, t1f+aU , >3 Ur QP~ ~ P~-SL' Q.59 - Af~.r ~r~,i«a ii (1s`i; ~ v~~ RiB.+~% kr~9,4t: SN:?:rq ~;£ti tCh,O t' °dP . ~r~ f ~.tr 3~.+ +~PYLr~ @ {t5~:~1 5~. #Pa 43 J?~." ~ 'vils' itbS.Ci $:tt pf#ts C~~} ti.6P P.1=~.4 bldkS Q itsE;€} 89.9E tt°d,61+ d~,Ei; 6SR.fi £PQ~S 'Ek$Q a t.• , s ors tls.~t ~.5t ~~ - arm r {¢~r.:t ,.r~,~ ~.#~.~ r ~ „~ e pE~; r~~ tear ! 2it?:. r~ :;.&t p1+:a,E BfH,~ 1i (+SE.~P 1~,~E 619,:33 'Fn~d..:,; . .` n ~ Y~Pr(•~ :-:'~ itl.~3 $*P t ~f'~,£ PD•Qv% dCt Ai>4,P BE~,@~ ~ S;ff.rs kid' t?S.+dt t~tSf,rg CS..s',,tP L§P:i 'G171 Gtt Ei~ !~$t9 R.taP AAat,t 3Pd.dS i ~ (rBr,,E) s~F,~,~, d•7ety. iRAti.#3 t.H.r^..& z`t~a ~-1-~U t3 kr } 'YIGi; rca.~ r:E-!' Esi~t pP$~, G tl~~,ta4 ~•„~ EP~,~ ~•{,Q C~E~.~ td'dE4` fE~-~ . .t7:?P ! ifila f)'°~ _ G.=: t ~ArB,P arte~ 4 (1'~~a°'t ~`~°ar~ S tF+.3R w~.t•c' d~ a :°.r5{~ Fp•$Q ~ leP ! vros [c-~ 2$t 3~,E ?rL",@S p ;esE~} X4.5£ fitB,CsA tf~,p8 k1a£ 8 sEr-~ ?*'b~9 . Aft ' t3#r«g 't G•-SJ rQ-~E1 n-3t #'•:QP Hbkr.t Amb.# ar~,~ i+Y$f~;- " U ~tt~,Ci { rt$ E) ~g, ~s e~'c ~€ BrQ,2'. blot i3f* ~~,Ai: r R@ . iV,'N'~ Q (tCr $ Gc +y?-C8? " ,~ aaP ° T Pt~u'Q ~0.6f Al:3r 1.ic~b'~ E~ , gt+~.6} ~ ;`a,7.;~" k60.tsR . !~ ~:'r_.a~ ; E?*sfi rA-r di D ~d E , i3P d NQS tA4dt.- MCP ~*~,P @eP$,6e= t3 ~PY~.~ :~.~ - i~P9.~ d~E3.R33 €*~b tit[ Ezt~ . asr f t C f`~~ U~P C B 66a~P ~B R.P.@.Q~' t' (t[E.EI r~9S #~f3.$~ #P~ P$ , fS~r:.-~ Qa~ III~80 BI.S1 . R ?! ,P Ata,~ fl FPS>P~ _$7),y`«y Drt~2r- b5$.A~ ~6 8 ~ +l4 tQ-?,.d fi,NP :~ t¢d:~$ Pr 1S t'd-3?i i P 7 !l.c:C N A~,4 P«3,~x f ~rRE.k') ' .~'. +~PB;ff+~ A(~,f~ ttEC~ C.'~' PCl-6`; , $n s ~ -~ $. r .t oAd.,d; C {t .v';S) ,3~-d+~ At~.~-~ ,".~S.A~ ~=';9 t~ t~•~;~ bfr,..y a~e5 PEJ~:*, FT,t?t; d~.d ~: z gl~~~} p~.sZ s;A.~? ~.i~~ .~ r~~ ra;~ 3s~r • !' J !"~~ r ~ x,91$ $i~,f ~ 94C,,t:, Q ('j$,~} dt~,~' brt~,t?R r;-W'~#;; iY.Y.p St~3 at~'Cid , Q~ ~.sa ata~ ~r- .+ ar;9,~: i, ir~~,~ ~r;:~.~ rr~;~a s•r~,:.~ e~~:.e e~i1~ rr,-"~! ~ ~ t ,. ' P4i~1 ' ~' ~. ES ' ~•.P~,P armor " c grtc ~ r~+.~'e tsr~, ~b t~~ ~ crr ~~ ~t~r ro-L'~ . g P~ !£ ~ 1.+ 4 ti'l 9•k ,E dt+ kiY•i 9j {i'~9,.~ dtLXv_s: d+rC~,de. t+k$,t~c f1~4's~ &'a!s ?1.41!) t.PS i ~ v~0 EO~t1 to<~ sl~s rc~P A~.:>~: ' R~ il4&.Kb :~ ~.Fw,~ , lt83,A~. LF.'.~9 t~".~aT a iC ~s": p~ j Pp ti ~t,~ ham.! P p! d,~ A ;r;~:b7 -d~.5+£ ?.!a•!R~ r;.E•b,A3 0~,8 t+ !^~ c5£ ~xs } g a eas~: ae: ,35 ~ ; rC~;e= ,&~ ~*r~,r>~ +~2-,r~;, - 4:Ca3 r fr^: p "r ot`313 ei-~ 45s ,,y~,,t t'ts.~ g:CS,d1 Pr3t5.SF ~tF,.,'tt~ 88B,c?1 Lon PL+a"1 . 12.E:£ ` 1 P9~ ~~~ r..a~.; trP~,B;• o irc~,w~ ~ees~ Qt~,eb a.a+ ;-~;^,.~ l2~a cr.as • t., r~~ ~.. Q3~ .~.- ASP .,. C 'a~' bP~jgS P l ht ~ .~~rsne} s ~~~ ~ ~r~~ ~.~.;~ _t~$ t~~ _ ~~i _.._. . . ° i tGt ~ ~~,di '; ~aK~B_i 8~3~ ,` sk3olba'+3tran~ :.»Ers7mt6>;a-id ~retss r~;e#?- :.-. ,z`59 .v! :w-::;ri+~ - +~-C1PAP~;° HOUSING AND REDEVELOPMENT AUTHORITY WRA Letter No. 4a Agenda August 16,1.999 "~ Issue Statement: Public hearing and authorization to sell 7520 Colfax Avenue to Steven Marlin Grant Homes, Inc. Background• The Housing and Redevelopment Authority (HRA) acquired the property under the Richfield Rediscovered Program. It is proposed that the HRA sell 7520 Colfax Avenue to Steven. Marlin Grant Homes, Inc. for the development of a new single family home. The proposed home will be two stories, over 1,900 finished sq. ft., and will have three bedrooms, 2 1/2 baths, a fireplace, and main floor laundry. The end value is estimated at $213,500. The project would be conducted in accordance with a development agreement. Recommended Motion: Following a public hearing approve a motion which adopts the resolution authorizing the sale of 7520 Colfax Avenue to Steven Marlin Grant Homes, Inc. Basis of Recommendation: 1. Steven Marlin Grant Homes, Inc. has built several homes under the Richfield Rediscovered Program. This company has provided evidence of experience, capability and financial security. _ 2. The HRA acquired 7520 Colfax Avenue for the Richfield Rediscovered Program. 3. The terms of the development agreement have been negotiated and are in conformance with program guidelines.. 4. Notice of public hearing on sale of the property was published on August 4, 1999 in the Sun-Current. -. Alternative Recommendation: Do not proceed with the development agreement with the recommended builder and direct staff to find another buyer. Discussion/Decision Mode: Closing would occur in August with construction starting soon afterwards. tfully sub fitted, to en L. evich Acting Executive Di ector SLD:cak Attachment HRA RESOLUTION NO. ~~~ RESOLUTION AUTHORIZING THE SALE OF REAL PROPERTY LOCATED AT 7520 COLFAX AVENUE TO STEVEN MARLIN GRANT HOMES, INC. WHEREAS, the Richfield Housing and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA) desires to develop certain real property pursuant to and in furtherance of the Richfield Rediscovered Program adopted by the HRA, said real property being described as follows: Address Legal Description 7520 Colfax Avenue -Lot 6, Block 22, Irwin Shores WHEREAS, the HRA is authorized to sell real property within its area of operation after a public hearing; and WHEREAS, the purchaser of the described property has been identified and a development agreement negotiated as follows: Performance Address Sale Price Securi Builder 7520 Colfax Avenue $35,000 ~ $35,000 Steven Marlin Grant Homes, Inc. WHEREAS, a public hearing has been held after proper public notice. NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority in and for the City of Richfield: 1. A public hearing has been held and 7520 Colfax Avenue is authorized to be sold for $35,000 to Steven Marlin Grant Homes, Inc. 2. The Chairperson and Acting Executive Director are authorized to execute a Contract for Private Development and other agreements necessary to .effectuate the sale to Steven Marlin Grant Homes, Inc. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 16th day of August, 1999. Thomas E. Harms, Chair ATTEST: Michael Sandahl, Secretary Front Elevation I'~iC~ ~itillaX AV~i11~1@ Rear Elevation Right Elevation .e ,~ • ~ ~ 3 '.S .- ~= .. _} ~ ., µ.~ . . ' ~ ~ ; ~ ~ ~" ~ ~~~°- , . _ ~ - ~_ w., ~ - . ' ~ '- l` ~ ~ ~ - . 7 i i r ~' .. _' r • ~ ~. • .i . .H i ~F , ' _ _ ~ First Floor '. '. .. ~~ .._ ~. Second Floor HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 49 Agenda August 16, 1999 Issue Statement• Public hearing and authorization to sell 6600 Oakland Avenue to Comerstone Advocacy Service. ' Background: In October 1998, the Housing and Redevelopment Authority (HRA) approved the securing of funds from the HOME Investment Partnership Program (Federal HOME funds) through Hennepin County. The funds would be used for Comerstone Advocacy Service (Comerstone) to purchase the property at 6600 Oakland Avenue from the HRA for their transitional housing program. Subsequently, Housing Trust Fund money from the Minnesota Housing Finance Agency (MHFA) was applied for and received for remodeling the home and Federal Community Development Block Grant (CDBG) funds have been designated for demolition of the commercial space. The Richfield Remodeling Advisor developed the scope of improvements in cooperation with Cornerstone staff. Pro Bono architectural assistance was provided for the new north entry that will be constructed after removal of the commercial space. Following the HRA public hearing and sale, Comerstone will be contracting with D & J Remodeling Service to do the remodeling. Work will include replacing all of the windows, moving the garage onto the new slab, installing new roof shingles and siding on the house and garage, constructing a north entry where the commercial space currently exists, interior painting, asbestos abatement, separation of utility services that had been shared between the commercial and residential spaces, and updating electrical, plumbing and heating. , An agreement between the HRA and Comerstone provides for the sale and rehabilitation of 6600 Oakland Avenue by Comerstone. A Cooperation Agreement was developed by HRA legal counsel as an addendum to the Purchase Agreement between the HRA and Comerstone which specifies the HRA's role in securing funds and developing the scope of improvements. and Cornerstone's responsibility to implement the scope of improvements, .properly landscape the property, and comply with federal and state reporting requirements for the terms of the various funding sources. A summary of the financial elements of the project follows: Acquisition: Property Acquisition by HRA $180,000 Removal of Commercial Value and Structure 40 000 Future Estimated Value Upon Remodeling Completion $140,000 Sale Proceeds from Comerstone (HOME funds) $ 50,000 HRA Deferred Second Mortgage for Balance 90 000 Total Return to the HRA $140,000 (HRA "write down"estimated to be $40,000) Improvements: Demolition of Commercial Area and Remodeling $110,000 HRA Grant for Demolition and Rebuilding North Wall $ 20,000 (CDBG) Ten Year Remodeling Deferred Loan (MHFA) 90 000 $110,000 During the first ten years, the MHFA loan is reduced on a prorated annual basis as the HRA deferred loan steps up an equal amount each year. In the tenth year, the amount Cornerstone owes MHFA is zero and the amount owed the HRA is $90,000. The-RBA's $90,000 mortgage is recovered when the property is sold or transferred at some future time. Recommended Motion: Following a public hearing, adopt a resolution authorizing the sate of 6600 Oakland Avenue to Cornerstone Advocacy Service in accordance with a Cooperation Agreement. f Basis of Recommendation: 1. The Planning Commission and City Council have approved a conditional use permit for the property to be used residentially. It is zoned commercial. 2. Federal HOME funds have been secured for the acquisition of the property by Cornerstone. HOME funds received now as land proceeds when combined with a deferred loan in the form of a second mortgage to the HRA, return the estimated value of $140,000. 3. MHFA State Housing Trust Fund monies have been secured #o finance the remodeling; a 10 year $90,000 deferred loan with a prorated amount reduced over the loan term until nothing is owed. 4. Community Development Block Grant (CDBG) funds have been secured for demolition of the commercial space; a $$20,000 grant from the HRA to cover parts of the project that do not provide a value return. 5. Cornerstone has a need for more transitional housing, given that they have lost two units recently due to changes in HUD funding. 6. Cornerstone has provided services to families in crisis for many years, and provides a much needed housing opportunity. 7. The neighborhood has been kept informed of all public actions related to the property. Neighbors also received a letter from Cornerstone, with a brochure on Cornerstone's services enclosed, inviting them to a meeting to discuss any questions. The neighborhood has been supportive. 8. The HRA purchased the propert~r to discontinue commercial uses, restore the residential character and maximize the amount of funds that can reimburse the HRA for its cost of acquisition. The project, as proposed, maximizes the return to the HRA over the 30-year life of the project. Alternative Recommendation: 1. Do not authorize safe to Cornerstone. However, all funds identified for the project were secured in cooperation with Cornerstone and would be lost. 2. Consider other redevelopment options. Discussion/Decision Mode: The purchase agreement has been prepared in final form. The contractor could begin wo after execution of agreements and conveyance to Cornerstone. _ Re ec ully subm' ed, . ~ ~ . De Acting Executive Director SLD:cak Attachments HRA RESOLUTION NO. ~Z~~ RESOLUTION AUTHORIZING THE SALE OF 6600 OAKLAND AVENUE TO CORNERSTONE ADVOCACY SERVICE FOR ITS TRANSITIONAL HOUSING PROGRAM ,,. WHEREAS, the Housing and Redevelopment Authority in and for the Cit~r of Richfield, Minnesota (HRA) desires to sell certain real property pursuant to and m furtherance of its goal to remove bligh# and provide affordable housing, said real property being described as follows: Address: 6600 Oakland Avenue Legal: Lot 18, Block 1, Auditor's Subdivision Number 340 WHEREAS, the HRA is authorized to sell -real property within its area of operation after a public hearing; and WHEREAS, Comerstone Advocacy Service desires to provide services in Richfield in accordance with its transitional housing program, and in accordance with Federal HOME and CDBG guidelines and Minnesota Housing Finance Agency rehabilitation loan guidelines for funding; and a Cooperation Agreement with the HRA; and WHEREAS, a public hearing has been held after proper public notice. NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority in and for the City of Richfield: 1, A public hearing has been held and 6600 Oakland Avenue is authorized to be sold for an initial sale price of $50,000 in HOME funds and a $90,000 deferred mortgage by the HRA to Comerstone Advocacy Service and in accordance with a Cooperation Agreement with the HRA. 2. The Chairperson and Acting. Executive Director are authorized to execute a Purchase Agreement and other agreements as required to effectuate the sale followed by a rehabilitation project by Comerstone Advocacy Service. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 16th day of August, 1999. Thomas E. Harms, Chair ATTEST: Michael Sandahl, Secretary 66TH STREET- - _ WALK ASPHALT 70.00' ~ ` ~ '~ CUT i 40.i' 25.7' 1 .. - ~-- ----_'._m ~ ~i1L DEMOLISH r '~ I -RETAIL SPACE N 1` ' i I~ ~ I ~. REMOVE AND CURB I Z J N W a O ~a .1 N i o RENOVATE GARAGE J PL ZONING NORTH SCALE 1' ~ 20' DATE 10-17-98 6600 OAKLANQ AVENUE i W Z W al 0 z Q J O SITE F HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 50 Agenda August 16, 1999 Issue Statement: Adoption of a resolution authorizing the acquisition of 6901-12th Avenue, 6929 Queen Avenue and 6933 Queen Avenue under the Richfield Rediscovered Program. Background: Three properties have been identrfied for purchase under the Richfield Rediscovered Program. The property at 6901-12th Avenue is currently owned by HUD and has been vacant for some time. The house is a one bedroom, and consists of 772 sq. ft. The house has suffered deterioration to its roof and foundation during its vacancy as well as water damage. The detached garage has suffered storm damage, including the impact of a large tree limb which continues to lie on the roof. HUD's sale price is $60,000. It is anticipated that the Richfield Housing and Redevelopment Authority (HRA) will receive another ten percent deduction (reduced to a sale prig of $54,000) at closing due to its status as a local unit of government. The $60,000 amount is contained in the resolution in the event the deduction is not available. The property at 6929 Queen Avenue consists of a small 640 sq. ft. house and a single car detached garage. The house lacks a basement. The deteriorated roof has caused interior water damage. The flooring, walls and fixtures are deteriorated and dated. Although its estimated market value is $75,000, the owner is willing to sell the property for $69,500 due to the extensive repairs required. The property at 6933 Queen Avenue consists of a 496 sq. ft. "garage" house, set back deep from the front. of the lot, with serious structural problems. Its estimated market value is $45,000. The owner has considered remodeling the house, which would need to include installing proper footings and reframing wall and roof to provide proper interior ceiling height. Because these are not cost effective solutions, the owner has also considered moving a house onto the front of the lot. However, the owner's pursuit of houses available from Newt Ford Town and Urban Village did not lead to redevelopment. Because the house is uninhabitable, the owner has not occupied it since purchase in 1995, and the substandard conditions remain. Further, the property at 6929 Queen Avenue when purchased by the HRA, cannot be developed to its full potential given that substandard conditions remain at 6933 Queen Avenue. The owner of 6933 Queen Avenue has been provided opportunities to voluntarily sell to the HRA but has not been interested in selling. The HRA, through eminent domain, could acquire and redevelop the property, removing both the deteriorated property at 6929 Queen Avenue and the vacant, uninhabitable property at 6933 Queen Avenue. The HRA, in authorizing acquisition through condemnation, is following a consistent process within the Richfield Rediscovered Program to allow acquisition without voluntary sale when significant substandard conditions exist. The HRA last authorized Richfield Rediscovered condemnation when acquiring 7520 Portland and 6205 Morgan Avenues. Funds, to be borrowed from the development account, are available to acquire 6901-12th Avenue from HUD. The proposed Richfield Rediscovered bond will provide for the purchase of 6929 and 6933 Queen Avenue contingent until funds are available. The bond proceeds would also reimburse the development account for the purchase of 6901-12th Avenue. Recommended Motion: 1. Adopt a resolution authorizing the purchase of the properties at 6901-12th Avenue for $60,000; 6929 Queen Avenue for $69,500; and 6933 Queen Avenue for $45,000. 2. Adopt a resolution authorizing eminent domain proceedings #o acquire the real property located at 6933 Queen Avenue. 3. Authorize the Acting Executive Director and HRA Chairperson to execute Purchase Agreements and other documents to effectuate the acquisitions. Basis of Recommendation: 1. The properties meet program requirements for acquisition. 2. Bonding for Richfield Rediscovered has been authorized by the HRA, and will be considered by the Council in August. A contingency will be included in the purchase agreements to ensure that bond funds must be made available to proceed with acquisition. 3. The property at 6901-12th Avenue has been vacant for a long time, and it is necessary to purchase quickly from HUD when property becomes available. Waiting for bond funds to be available will cause the transaction to fail. 4. The owners of 6901-12th and 6929 Queen Avenues have voluntarily indicated an interest in selling the properties to the HRA. 5. The purchase price of 6901-12th Avenue has been established by HUD at $60,000. The purchase of 6929 Queen Avenue was negotiated based on the estimated market value and determined to be $69,500. 6. The property at 6933 Queen Avenue is vacant and uninhabitable. The 6229 Queen Avenue property cannot be developed to its full potential if substandard conditions remain at 6933 Queen Avenue. 7. Unless directed differently by the court during the condemnation process, the cost of acquisition is $45,000. A voluntary sale by the owner would yield the same price. 8. Eminent domain proceedings effectively end the problem of a vacant substandard property with any and all liens that may be present. At any time prior to the completion of the proceedings, a voluntary sale by the owner would be accepted. Alternative Recommendation: 1. Do not authorize acquisitions. 2. Do not authorize eminent domain proceedings. Discussion/Decision Mod®: Agreements to purchase are ready to be prepared in final form. The opportunity to purchase the properties on Queen Avenue is contingent on bond funds being made available. R ctfully submitted, ,~-~„~ n L. Devich Acting Executive Director SLD:cak HRA RESOLUTION NO. "~~' S RESOLUTION AUTHORIZING PURCHASE OF REAL PROPERTY LOCATED AT 6901-12TH, 6929 QUEEN AND 6933 QUEEN AVENUES FOR THE RICHFIELD REDISCOVERED PROGRAM WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA) desires to purchase certain real property pursuant to and in furtherance of the Richfield Rediscovered Redevelopment Project (Project) heretofore adopted by the City of Richfield- (City) and the HRA, said real property being described as follows: Address Legal 6901-12th Avenue: Lot 10, Block 4, Richlands 6929 Queen Avenue: Lot 17, Block 16, Tingdale Bros.' Lincoln Hills Third Addn 6933 Queen Avenue: Lot 16 and the North % of Lot 15, Block 16, Tingdale Bros.' Lincoln Hills Third Addition; and WHEREAS, the HRA is authorized by Minnesota Statutes Section 469.012 to acquire real property within its area of operation; and WHEREAS, the properties meet all program requirements for acquisition; and WHEREAS, the U.S. Department of Housing and Urban Development, seller of 6901-12th Avenue, is selling the property at a cost significantly reduced from its estimated market value; and WHEREAS, the negotiated purchase price of 6929 Queen Avenue is based upon its estimated market value; and WHEREAS, the purchase price of 6933 Queen Avenue is based upon its current estimated market value; and WHEREAS, purchases will not be made without the availability of funds for program acquisitions. NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopement Authority in and for the City of Richfield, Minnesota. 1. The purchase price of 6901-12th Avenue is approved at $60,000. 2. The purchase price of 6929 Queen Avenue is approved at $69,500. 3. The purchase price of 6933 Queen Avenue is approved at $45,000. 4. The Chairperson and Acting Executive Director are authorized to execute a Purchase Agreement or other documents to allow purchase for the amounts set forth in this resolution. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 16th day of August, 1999. Thomas E. Harms, Chair ATTEST: Michael Sandahl, Secretary HRA RESOLUTION NO. ~~~. RESOLUTION AUTHORIZING EMINENT DOMAIN PROCEEDINGS TO ACQUIRE CERTAIN REAL PROPERTY) LOCATED AT 6933 QUEEN AVENUE WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA) is a public body corporate and politic and a subdivision of the State of Minnesota organized and operating under Minnesota law, as amended, and is authorized by Minnesota Statutes Ch. 469 and other laws to acquire real estate by exercising the power of eminent domain under and pursuant to Minnesota Statutes, Ch. 117; and WHEREAS, the HRA has previously established a program pursuant to Minnesota Statutes, Sections 469.011 et sea. To provide for the acquitions of land and construction of decent, safe and sanitary housing; and WHEREAS, the redevelopment of certain real property located in the City at 6933 Queen Avenue, and legal described as Lot 16, and the North % of Lot 15, Block 16, Tingdale Bros.' Lincoln Hills Third Addition; according to the recorded plat thereof and situated in Hennepin County, Minnesota 4"SubJ'ect Property") is consistent and in furtherance of the HRA's programs and the City's Comprehensive Plan; and WHEREAS, the HRA has determined that it is necessary to acquire title to and possession of the Subject Property by the earliest date permitted in accordance with Minnesota Statutes 117.042. NOW THEREFORE, BE IT RESOLVED by the HRA, as follows:' 1. It is necessary to acquire the Subject Property as described in this resolution in order for the HRA to carry out the purposes for which it was established. 2. Acquisition of the Subject Property by eminent domain, in the manner provided by Minnesota Statues, C~apter 117, is deemed to be necessary and for a public purpose and is hereby authorized. 3. The HRA deems it necessary, to proceed without delay under Minnesota Statutes, Section 117.042, to acquire title to and possession of the Subject Property prior to the filing of a final report of commissioners. 4. The HRA's attorney and staff are authorized and directed to commence eminent domain proceeds to acquire fee simple absolute title to the Subject Property, pursuant to Minnesota Statutes, Section 117.042 and to pay to the owner(s) into court, a sum of money to secure compensation to the owners of the Subject Property, which amount shall be equal to petitioner's approved appraisal of value as .determined by HRA staff Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 16th day of August, 1999. Thomas E. Harms, Chair ATTEST: Michael Sandahl, Secretary HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 51 Agenda August 16, 1999 Issue Sta#ement• Authorization of a four year funding plan for the Richfield Rediscovered and Transformation Homes Programs and a request to the City Council to authorize the sale of general obligation tax increment revenue bonds. Background• . On July 27, the Richfield Housing and Redevelopment Authority (HRA) authorized a Richfield Rediscovered and Transformation Homes Program funding plan. Under the proposal the HRA is requesting the City Council to authorize the sale of general obligation tax increment revenue bonds that provide $1.4 million in program activityr over two years. The City Council is scheduled to consider the request at a public hearing on August 23. Ehlers and Associates (Ehlers), the HRA's financial advisor, has been working on the bond structure. Ehlers recently concluded that a $2.8 million issue spread over four years provides better program continuity, a better interest rate and a $20,000 savings in costs of bond issuance. A memo from Ehlers (Exhibit A) describes their analysis in greater detail. The initial bond issue size, $1.4 million or less, does not change. However, approving the issuance of more debt than presently needed, to $2.8 million, provides the flexibility to issue an additional $1.4 million in debt for years three and four by working within the original bonding structure. Using the original bond structure for a longer period of time, perhaps at a lessor rate of interest, saves future costs of issuance and provides .longer term funding of the programs. Additional bonds up to the ceiling of $2.8 million would be issued approximately two years into the future. The HRA and City Council would monitor the program activity in two ways: the annual budget process and through the annual report on tax increment obligations prepared by Ehlers. Sid Inman of Ehlers will attend the HRA meeting to present more detailed information and answer questions. Exhibit B, attached, provides the original two year plan. Recommended Motion: Authorize the four year funding plan, requesting the City Council to authorize the sale of general obligation tax increment revenue bonds and authorize the HRA Chair and Acting Executive Direcfior to execute agreements related to the funding plan for the Richfield Rediscovered and Transformation Homes program. Basis of Recommendation: 1. Doubling the amount of debt from $1.4 million to $2.8 million provides the flexibility to generate operating funds for a longer period at an overall lesser cost of interest and issuance. 2. The issuance of $1.4 million this fall and again in approximately two years under one bond structure provides 26 to 28 new homes and 60 to 80 transformations. 3. A four year funding plan has been developed by Ehters, reviewed by legal counsel and found to be an improved course of action over the two year plan previously approved. 4. All bonds are a general obligation of the City; however, it would be 100 percent supported with tax increment and land proceeds. 5. The HRA, through a pledge agreement, covers debt service with future Richfield Rediscovered tax increment and from the housing trust funds provided by Gramercy and Urban Village tax increment districts. 6. Richfield Rediscovered is important because it removes small, substandard and obsolete homes and provides new homes for people at all income levels. 7. The Transformation Homes Program is important because a small amount of incentive deferred loan financing from the HRA helps provide more family-style housing and encourages homeowners to improve rather than move. Alternative Recommendation: 1. Proceed with the original two year plan as"approved on July 27. 2. Continue to evaluate alternative funding sources. 3. Further modify the proposed four year plan. Discussion/Decision Mode: The City Council will consider the bond issue following a public hearing on August 23. A negotiated bond sale would occur 60 days thereafter. Funds would be available in fall 1999. Re p c Ily submitted, eve . Devich Acting Executive Director SLD:cak Attachments EXHIBIT A FREERS 6 ASSOCIATES INC TO: Bruce Nordquist, City of Richfield FROM: Mark Ruff -Ehlers & Associates DATE: August 9, 1999 MEMORANDUM RE: Principal Amount for Richfield Rediscovered Financing The City and H.RA are considering the issuance of G.O. Tax Increment Variable Rate Honds for the continued funding of the Richfield Rediscovered pragram. Previously, the HRA has discussed a maximum principal amount of bonds equal to approximately 51,400,000. This amount would carry the program far approximately two years. The HRA does have an option which may save finance costs in the future due to the unique structure of variable rate debt. The HRA could authorize the issuance of up to 52,800,000 of principal, which would carry the program for four years instead of two years., While the initial bond issue would only be enough to fund the immediate costs of the program ($1,400,000 or less), the higher authorized amount could allow the City and HRA to issue "subseries" of bonds in future years. The subseries concept is similar to a line of credit at a bank. The total amount would not be drawn immediately, but the HRA would have authority to draw more in the future. The subseries would avoid approximately 520,000 in new legal opinion, rating agency, and financial advisor costs. The subseries options does not diminish the NRA's control over the total amount of debt to be issued. 'The HRA could implement a process which requires HRA approval and a new set of financial projections prior to the issuance of a new subseries of debt. We do recommend that the maximum amount of debt be increased to $2,800,000 to offer the HRA the most flexibility in options for future Richfield Rediscovered needs. /soot the dtsk of.• Mask Rrefj Vice P~esidtat Eblen 6 Associates, Ise. 3060 Ctntre Pointe Dritx Roseville, MN ft113 Pbont: (6SIJ 697.8505 Fax: (651) 697.8555 EMall: markr~eblers•is~c.com EXHIBIT B MEMORANDUM TO: Bruce Palmborg -City of Richfield Bruce Nordquist -City of Richfield Pam Bookhout -City of Richfield Steve Bubul -Kennedy and Graven FROM: Sid Inman - Ehlers/Pubiicorp Inc. DATE: July 19, 1999 RE: Richfield Rediscovered Finance Pian As per your request, we have been reviewing the long term funding options for the Richfield Rediscovered Program. In the past the program has had a variety of funding sources and each year it was uncertain that the project would be funded . Your objectivve was to find a secure funding source for at least five years. At the current time the city{s funds are committed to other capital projects and tlHerefore not ~ ` available to the HRA for this project. The HRA hash to krok to its own funds in order to continue the project. - Due to the lack of dty funds we determined mat the HRA woul! have to borrow the funds needed from another source. We first determined that we needed to establish base Nne data as to the annual need of the project. We established the goal of 7 homes a year and $200,000 for the Transformation Program. Following are the sources and uses for the project: SOURCES Land Sale Income 210,000 Other TOTAL SOURCES 210,0000 USES Acquisition Cost 455,000 Admin and Demo 42,0Q0 Other Costs 28,000 Transforma~on Program 2, DD.(>00 TOTAL USES 7,000 TOTAL OAP 515,000 Funding the project presented two problems. First, we needed to borrow funds up front for the full $725,000 needed to complete one year of the project. But, we would receive $210,000 within a year and a half. Therefore we only needed to borrow long term for the balance or $515,000. The second problem was finding a source of revenue to support the borrowing. In order to solve the problem of the short term need for $210.000. it was detem-ined to sell short term General Obligation variable rate bonds. These bonds are resold every month and allow the aty to pay back any or all of the debt every 30 days. These bonds are sold at short term rates and• will cost the city far less then a fixed rate 20 year term bond. For example, at tide time of writing this memo the short term rate is around 5.3~°. The 20 year fixed rate debt would cost the dty around 6.3%. We have identified 5 revenue sources that we can use for the debt. 1. Tax Increment from Urban Village 15% housing trust fund. $118.000 Pay 2001 2. Tax Increment from Gramercy 15% housing trust fund. $40.000 Pay 2001 3. F~cisting Tax Increment from Richfield Rediscovered Projects. $12.500 Pay 1999 (Available for only 10 years if we shut the existing districts down). 4. New Tax Increment from new Richfield Rediscovered Projects. $10.800 Pay 2003 5. Interest on cash in the housing trust fund. Attached are cash flows that assume that the City sells one bond issue. This is enough bonds to fund two years of the project, or enough for 14 houses. You will rx~te that we have sized the bond as a fixed rate -- not a variable rate bond. This is due to the fact that we want to use the most ' conservative assumptions when forecasting the cash flows. After two years we would re-evaluate our cash flows and detemnine H we can issue bonds for 14 more houses. Please review this information and if you have additional questions, please do not hesitate to call me. _ from the deak of: S/d Inman Devs/opmene Consultanl/Flrrancls/ Advisor Ehlers and Assoc htc. 3060 Gntsr Po/nh Drfve Roasvl!ls; AW 661 !3 (661) 887.8607 FAX.• (66f) 8878666 E,AIA[.•aldOdrferaixaoin N:1MieesotaUt~ehfieWIRREDlS1RRMFMO.2.wpd 1. ~++r ~ R a,R.te R.disaovad Pnljael 2a66.y.9~s Dsbt saevioe Cash Flow N7nwltF~oa~ ~ rye tiom ray~hMt F~MII , ..~_. rs~ r«1ee IY r TOYI GP UM~t Ni1MMt Tats InaraMnt Tas Meat TiW ww A:rw~ P a sae wrn On IMawM 6twaaw R.wrw. Pam N MaeMt kttwut 6bae llaonds tlw- TiwtFiwO Pr~rnNnt 91ab ~4f~Mk ~ 4wN L000. O1sMet 01s*kir . 1999 = 2000 0.50 1 ao aoo aao aao aao 00o aao a9o~ 2000 . 1 50 72,s/o0o a2.41aao a2,4/apo 14o0aoo aoo a6o a,4/a6o 2001 . 2 ao 64.300..60 st.307.60 ai.3o7:so 14AOaoo ao0 app 2001 . 2:50 s4.364.so s.ao7.6o s4,3o7.6o aao aoo app ~~~ 1 ~ 2002 3.00 35.000.00 6.60li 64,307.50 41 320 00 se.3orso~ 96 720 00 se,3or.ao aoo a6o aoo s4.3o7.6oi 2002 3:50 , . 34726.00 . : 39.7!3.00 0.00 0.00 0.00 app 0.00 6.400.00 36326 OD 01 ~ 2003 4.00 60.000.00 5.6011 X725.00 99.726.00 app ~p ~~~ . ~~~ 34726.0 ~ 2003 2oa 4.50 aoo oaoo oo s 9ox 30.,96500 37.965.00• aao aao 1a6oaao 2>:16sao 94726.00 ~,~,~: 2004 s 5o . . 3a,9esoo 97,90.1.00• ao0 000 /0.600:90 67.10.3.00 n 96sao! 2aos . 6.ao s5 aooao s 9ox 34216.00 36.210..00 a6o 0.60 10.600.0.0 2a~4/6:ao . 3a21s.6p, Zoos s so . . 36.t+aao /01.:,0..60 aoo aao ~ /0.60000 9aelsao /01~16.aoi 2aos . aoo aoaooao soolc 34,297.60 34.297.60 34.297.60 104.297.60 a0o ago 0.00 a6o /asoao0 ! 6 23~497d0 ~ ~! 2006 a.so 3$/9f.60 32./97.60. 0uo0 0.00 0000 0. ~ 10.600.00 9449f.60 s1 3a 6o t , 2007 sao asaoo0o 0.000. 32,197.60 107.197.60 a6o ao0 to-soaoo , . o6 2p 6o 3a/aao~ f 2007 ~ aso ~ eoao00o a1o1c 29.947.60 249q.60_ 0.00 6100 /0.690.00 ,, , /4147.Op lo .197.60 24947.60 za oe as o 24947.50 104947.60 000 ao0 /4soaoo 9414740 t64947.60 2009 10.00 ssaoaao 6.1o1c 27.so7.6o 27 0.07.so rso7.6o• 0.07 60. 1/2 aao app 000 10.600.00 /sameo 27.t07.6o 2009 loco . 24.91600 . , 24.ns0o ao0 000 000 10.600.00 1a6op0o /olaofso /t21s 6o 11$id-,d0 24 20/0 2010 1,.00 11so 90,0.00.00 saolc a4:91soo 114.91600 0.00 aao l0,soa0o , 101,11600 „916,pp /uh[po 2011 12.00 95.000.00 6.2016 _ 2x,120.0.0 22 t26.00 22.126.00: /10. /20. 0.0: 0:60 000 000 10,100.00 1/,326.W 2zus.pp 2011 2012 12so 13 00 : _ , ,9,/6apo , . ,0.,60.60: a6o 000 a6o laeoaa0 laeoaao 106,326,00 a3ea6o ,~ 1261,010! 16~ 1apo; 2012 . 13 50 100,000.00 8.30% 19.160.00 119,160.00 0.00 0.00 10.600.00 104360.00 , 114,160A0! 2013 . 14.00 105.000.00 6.30% 14060.00 16„030.00 14000.001 121 03pp0~ O:W 0.00 000 /0.900.00 423000 14060.00) 2013 14.50 , 0.00 10.000.00 110.230.00 /21r00a0pj 2014 1soo 110.000.0.0 s.4016 12,722.60 1$722 50 12.7xti60 ° 12: a22 so' 000 0.00 1Q;90Q00 1.922.60 1? 7!2.60 2x14 1s so . , . a6o aoo 10,600.00 111,s2:,so >r~rn,,p~ Cols . 16.0.0 120.0.00.00 s.4olc 9,202.60 9,xOQ.60 9,202.60: 129 60 302 ago a0o 0.00 9,20260 app 420Z6P' 2o1s lsso 6,362.60 ; . . 4362.60' 0.00 0.00 ao0 10.60000 6 /1440260 t242or2.6 2016 2o1s 17.00 use t25,aoooo Bsox 6,362.60 130.362.60: 0.00 0.00 ~ 10.600.00 000 /19,662.60 6,ta2.6G 134361,60 1 1,300.00 1,300.OOj a0o 0.60 1,30Q00 a0o 1.300.00 2017 16.00 40.000.00 sso16 1 30.0.0.0 41 300 00 2017 ,s s0 . , . aoo aoo !0.600.00 30.600.0.0 41,300.0.0 2016 . 10..00 o.ao e.so16 aoo aao aao aoo; aao 0.w aao aao aao aoo 2018 19.50 o0o aoo aao aoo 2016 20.0.0 o.ao s6olc ~' apo aoo aao~ ooo' 000 am aao ' ,.~. 000 „~,. aao 000 .. ,nd-4.wk4 Pn~ad by Eh1eR/PubflOprp, Inc. PAGE 1 FiidlB C8y d Fliehxbid aid R ~ d P ncj l e xoova Z4~A9y-9D sl: --- ~ - Avaiabk Ttx b+bMnara Cash Fbw , _ -~ - T~i Tit Tat T4s Tat ~ ~'41~N - ~ '.. ._,~_-^ hdoa Mlaoatll, Ine~tRat1M M1o1tA1p1t IttftaltQt M101ta1tllt Yadt fw Yadt IPOr ~~ YfJIR h11od dpNMWq Rmlwt ~ I1wt1M1t RaNMN 8t~vt1alt MtlMUR 8kae ' deed ~ dalanet IA4te Oltlawar EaMYeg I,t11/ Ot9t Otht dtltllef MIMpe _ MMtOt IOe118tidlbC. 911gNItt08itd 418011 ftnleeA fnMad 1999 x60 0.0o aoo 0.00 s~ao.0o aoo oxo axo aoo 625000 2000 1.0o a 25oao aoo oao s.2eooo aao ,2bao aao aao ,2 s» ~ 2000 1.50 ,2,x25.00 aw a0o 626aoo aoo 252.6D aao oao , , /6,x 50 2oa 2.00 19,127.60 0.0o a0o s.25o.0o ago xe256 ago oo0 . 26»x06 200, t6o 267w.os 56967.00 16s49.ao s,26o.00 0.00 6,s.2o aao aao ,,, ~, » 2002 7.00 1,1,341.25 669x7.90 ,9,849.00 6.260.00 ao0 2,27883 194720.001 a0o . , 1 02 714 a 20x2 s.6o ,02,a,4.oe xs,9x7.ao ,9,sw.o0 s,26o.0o aa0 $01x28 (3x725.001 ao0 , . 166101 38 20os 4.00 16s,1o1.3x ae,9x7.ao 19,e1eaa s,26o.0o aas 4,,44.x3 1w.x26.oo1 oso . 146944 78 200.1 4.60 148,944.3x .58.967.00 19,84x00 8,250.00 x00 2,9».88 027,,86.001 0.00 . 209 804 27 2001 6.00 209.601.27 54967.00 16849.00 8,260.00 x00 x19400 161,1ss.6o1 Qoo , . 211 ext xx 2001 6.60 211,881.38 68,9x7.00 19,84x00 8,25000 x00 42x1.47 (264/b~001 x00 . . 2» ~ ~ Zoos so0 276,7».9s 6e,9s7.oo 19,849.00 sa5aoo oo0 6,615.40 (96n5,oo1 a4o , , 21a,9xx3e 2aos e.6o 276835.3e x8,967.00 ,as49.oo s,26ow 000 6,5/67x (27,4!1.501 x40 7ao21~s, 24x6 1.ao 347,025.x, se,987.ao ,oe49.00 s,26aoo aoo 688x41 (90,4p.601 ago a1, ~• 2008 7.60 311,46T.Qx 68,9x7.00 1641x00 6250.00 0.00 6820.06 (21,187.50) x00 41, 860 11 2007 8.00 411.950.14 68,96T.00 19,849.00 6250.00 x00 626!,00 X1.601 400 . . !4 406851 . 2007 a.5o 406,{61.84 de,9x7.oo 19,849.00 s.25o.0o aoo 61n.,6 116,x.501 0.00 , 49686729 2008 9.00 486853.29 x69xT:00 19,849.00 6,26x00 0.00 8,888.0) (88,i~q.QO) 0.00 . 4» 61x88 2ooe xx0 naa3o.xs 5e,9x7.oo ,6449.00 e2xaoo 0.w 641x!1 (,e.141.eo1 aoo , 44646x4 . 2009 ,aoo 656,469.97 569s1.oo 19,949.00 s25a00 000 11,12820 1,01.101.60) x00 5sg9gp: 2009 ,a5o sso,947.87 se,9s7.ao ,9,e19.oo aao a4o 11,01x93 ral,aool aao !164x.45; . 20,0 ,1.00 s2ssx1.s7 se,9x7.0o 19,ew.ao aoo a4o /2,bx>,7S ro4.116,ao1 aao f/x 4o1 9s 2010 ,1.60 s1x,9o,.9e 5e,9x7.ao . ,as4xoo aoo 0.00 1$214.04 (,1A26,00) a4o , . 44asrl aQ~ 20,1 ,2.ao s93s71.on as.9arao~ 19,e4xoo aao 0.00 1xax.42 pas, 26,051 aao . 486006 44' ~ 2011 ,2.x0 sx0,a3s.44 68,9x7.00 19,649.00 ago aoo /x,80471 16xeo.4o1 aao . , »xm2 16: 2o1z 1s.oo 7s4.o72s 6e,9aao /9,84xOD aso. aoo 16241.44 1,oeweaool 0.ao . 74674xN• 2012 13.60 749.7x9.59 56987.00 ,9,44x00 0.00': 0.00 ,4,906.» 16.17a001 x00 aam.x4: 2013 ,4.ao e3xa71.3e ~ 56957.x0 ,sew.oo oao aoo 16»1.4 1110.Z3a00) aso 4Q5,721.M 2013 14.60 823,724.x1 649.00 19,849.00 0.00 x00 18,411.50 (1,81L601 aoo N7a42.N: 2014 15.00 817,092.x1 58,9x7.00 19,8.00 x00 x00 18,x41.88 (111,0.2.60) x00 802 x261! . 2014 ,x.50 902,32x18 56987.00 16949.90 O.ao ,,681.50 tao4a6s a4o a0o , ,.000 18125: l 2015 18.00 ,.000,788.23 56987.00 19;849.00 0.00 aoo 20,016.» (118,40!.80) Qoo , 981 217 ~' 2016 18.60 981,217.49 68,967.00 19,849.00 0.00 6,4x1.60 19,82x46 0.00 0.00 , 086096 x4 1 2o,s 2016 ,7.00 17 1.axs,a9s.34 5e,9s7.ao ,9,449.x0 ooo aao 2,.7o1.w r1664zao1 om , . 1,ae6o5a»~ .60 ,,o5sos0.7s se,9x7.oo 19,e4xoo o.o0 9,500.00 21.1121.0, a0o 0.00 , ,76 881 »: eon ` 1e.oo 1,175,887.7s 5x,9x7.oo ,9,849.00 0.00 O.OD 2x,6W.» 130.60x001 x00 . , . /241,6,1.62 20,7 2o e leso ,,247,6n.52 s69s7.oo ,ab~.oo o.o0 1ae0ooo 24,85QaS 0.00 oso t,axtaeael; , ,a.oo 1.3xzae3.e7 569x7.00= ,9s49.oo aoo 1640x00 27,241.88 ~ x00 x00 , 416M1 65t 2o,e 19.50 ,,47e,s1,.s5 6x,987.00 ,9,849.00 0.00 ,oeoooo 29,6168x 0.00 x40 , . 1 608 134 18! 20,9 20.00 ,.s9e,,3s.3x 6x.9s1.ao 19,bw.oo o.o0 lasoaao x,,962.13 aao x90 , , . 1 716716 ,1: 2019 2oso 1.7,9,715.11 se,9st.oo 19,649.00 0.00 12~,eesool 34,x94.10 x00 x00 , . 1 auo9on~ 2ozo 21.00 1.s47,aso.41 5x,9s7.oo 19,s49.ao aoo ,oeoooo 40,x/21 0.x0 aoo , 1 s47 411.42! 2020 21.60 1,887.817.62 58.887.00 f9,849.00 0.00 10.800.00 xxxiZ.3i x00 x00 , , f7~ 1 780 6xS 2021 22.00 1,780.585.97 Sx,9x7.00 19.849.00 0.00 ,0,800.00 35.81,.72 x00 0.00 , , . 1 81601a.M; 2021 2022 22.50 1.818.013.88 6x.987.00 19.849.00 0.00 1x800.00 38,720.21 x00 0.00 , ;047,94x98 23.00 2.043.W9.96 5x.987.00 19.818.00 0.00 10.800.00 40,87!.00 0.00 x00 17a444 98~ 2 2022 23.50 2.174.4M.98 60.887.00 19,849.00 0.00 10.80x00 47,488.90 0.00 O OD , . 66~ 5~ 307 2 2023 2023 24.00 2.307.549.88 58,987.00 19,849.00 0.00 10.800.00 46151.00 x00 . 0.00 . . , 2,447,714.88 j 2024 24.50 2.M3,316.88 56987.00 ,9.61x00 0.00 16x00.00 48.888.34 x00 x00 2,581.188.181 25.00 2.681,799.19 5x,987.00 19,619.00 0.00 ,0,x00.00 61,835.98 x00 0.00 727 061 18; 2 2044 2o 25.50 2.723.051.18 58,967.00 19,dI9.00 0.00 10.x0400 51.461.02 x00 x00 . , , 12820] 487 2 2s 2x.00 2,887,129.20 5e.9x7.00 ,9,649.00 0.00 1oeooxo 67,742.5s x00 x00 , , 01a0ea»: x zo2s 46.so 3.o,4,oes.78 Se,9s7.oo 19,s4s.oo o.ao 10.x00.00 602x1.74 a0o x00 , 60 x ,46884 4045 noo 3.,63,984.50 5x,967.00 19s49.ao o.o0 !0600.x0 ss,279.» axo a4o , . 11a,seea191 2028 27.50 3.316.88018 400 0.00 0.00 ~ 10,x00.00 6xs77.e0 ~ axo a0o x,394,011.»~ z.94e.3so.o0 99245000 12s 000 00 (74 930 ao1 , ,eo,2s1» ti 7n 060.001 a0o rt-b. Mc4 Prbparod by Ehbla/Publioxrp, Inc. PA1iE Z City of Richfield, Minnesota Taxable Variable Rate G.O Bonds ~Richtleld RedlsooverProJectj . SefS~s 7999 SOURCES S USES owed oarovlsa~ oegverod os~oln~ SOURCES CF FUNQS Pare ~ Bonds„» ............................» »»».» 51.730.000.00 TOTAL SOURCES»..».........»»......»....».... 51730.000.00 uses of FuNns . Total ups o~oouM (1.500'1~~» 25.5li0.00 costs a u~nos.»..~.»..».»..».»»»..».». ~,ooaoo ~ ~ ~ aaereac t~I F 221.M4.30 Deposit fo FMojeet Consbudbn Ftuai........»».»»».»....».» R .»»».»..:.... 1,450:000.00 oundbt0 Amaaa...........»».»».»...»».».».. 2.455.70 TOTAL USES..»»»..»».,.».»».»»..........».. 51.730,000.00 Ehlers 6 Assodates Leaders In Pubgo ffnarioe ~ = FtiCX~EDfsCOVER~- ~NQLE Pt~OSE' 5l14/1~ 11:0! AM l City ~of Richfteld, Minnesota Taxable Varsrable Rate G.O Bo>ids (Rkhlfeld Re~vef Projedj Series 1998 DEBT SERVICE SCHEDULE Oats PrNeiPM Carpon Mtlsres! Taxi PH FISCAL TOTAL 810111011 - - . ~+~ - - 7141a01 724/aoo 72,410.00 er01/tooo - - x4,307.30 54,307.30 - ?/01rZ001 - x4.307.30 x4,307.50 1oesls.oo 8101/2001 - - x4,307.30 a4,3o7.so - 2rolrloo2 ss.ooo.ao aaoo% 54,307.30 101,307.30 183,81x.00 8101/!002 - •3171160 32,712:30 - 2/01/2003 80,000.00 5.800% 32,712.30 1127/2.30 /86.425.00 8/01!2003 - - 30.87130 30,172.30 - 2IOVZ004 80,000.00 3.100% 50,97150 110.17130 181.113.00 8At/2004 - - 41.20130 41,201.30 2/01/2003 63.000.00 5.100% 41.202.30 114,10130 185.403.00 8/01/!003 - - 47.283.00 47,285.00 - yau~oe 70.000.00 1.x00% a,2/3.ao /17,233.00 //4,570.x0 ~+~ - - 4s,lesoo 43.118.00 . ?/01x2007 7x,000.00 1.000% 4x,1/3.00 120.113.00 183.370.00 8/01Q007 - - 42135.00 42135.00 - 2ro1/2o01 ao,ooo.oo a.lao% 42115.x0 122g6.p0 183,870.00 8101x2008 40.413.00 40.413.00 2f01~1001 85.000.00 6.100% 40.413.00 123,4!3.00 183,130.00 BIOiR001 - - - 37.10130 37,10130 . 1/01/2010 = - ~ 10.000.00 8.200% 37.102.30 127.102.30. 183.103.00 8101x2010 35.11130 36,/11N - 2101x2011 15.000.00 8.200% .35.111.30 110,112.50 /86,225.00 8!01!2011 - : '32187,80 32,187.30 - 2/O1x2012 100,00x00 8.300% 32,187.30 112,187.50 184.333.00 8/01/2012 - - 21.017.50 21.017.30 2/01/2013 108.000.00 8.300% 21,017.50 134.017.30 ~ 183,0,15.00 8101x2013 - - 23,71x00 13.710.00 2/01/2014 110,000.00 6.400% 23.710.00 115,710.00 184,42x00 8!0112014 - 22,110.00 22,110.00 - Z/01/2015 120,000.00 8.400% 22,110.00 142110.00 184,SQ0.00 3/01no1s - 1a,330.ao //,180.00 . 2/01/2018 125,000.00 8.300% 18.130.00 143,330.00 161.70D.00 8/01/2018 - - ~ 14,287.30 14,187.30 ~. 2/01/2017 135.000.00 8.500% 14,267.30 141.287.30 183.375.00 8/01/2017 - 1.100.00 1,100.00 - ?l0112018 14b,000.00 8.800% 1.0.00 154,100.00 184.800.00 8/01/T0/8 - - 5,115.00 8,115.00 - ?/O1x2011 153,000.00 8.800% x,115.00 180,115.00 185,230.00 Totd 1.730,000.00 - 1,408,720.00 3,138,720.00 ~n~.o sTAnsTtcs Bond Year OoAars .................. ».»......»....»... 522058.33 Avsrape L1a ................................................ 11780 Years Average Coupon .......................................... 8.3771M4% Net Intsrsst Cost (NIC) .......... ...................». 8.41411x0% True Interest Cost (TIC).....»............»....».... 8.53?2321% Bond YNid far Arbitrage Purposes ............... 8.3417583% AI Mdvsive Cost (AIC) .............».......».....».. 8.7483083% )RS Fo~l~n sass Net Interest Cost .................... .................».. 8.3772724% Walghtsd Aveiape klatwily .......................». 12.780 Yeas Ehlers 6 Assoeastes xiy . !glt~IPEGIS~VER S71Yt?f E PtJI leaders N f'ub~ Fharroe 3/14x1111 t t:Of AIt l .. t HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 52 Agenda August 16, 1999 Issue Statement: Issuance of a Certificate of Completion for Meridian Crossings, Phase ll. Back rg ound: The Housing and Redevelopment Authority (HRA) entered into a Contract for Private Redevelopment with Meridian Properties Real Estate Development L.L.C., d/b/a TOLD Development Company (Contract), for construction of the Meridian Crossings office redevelopment project on November 6, 1995. Subsequent amendments to the Contract followed on March 18, 1996, September 6, 1996, and April 21, 1997. Section 4.7 of the original Contract discusses the Certificate of Completion. It indicates that a certificate is to be issued for each phase with the issuance process being initiated by the developer. TOLD recently requested the issuance of the Certificate of Completion for Meridian Crossings, Phase II, as it intends to close on the sale of Phase II to The State Teachers Retirement System of Ohio (OTR) on August 27, 1999. OTR was also the buyer of Phase I in August 1998. The HRA approved concept plans for the .project in 1995 while the Certificate of Completion for Phase I was approved by the HRA on July 20, 1998. Construction of Phase II is substantially completed. TOLD still has some outstanding work relating to landscaping, drainage, grading, curbwork and sidewalk. In accordance with legal counsel's opinion, the Certificate of Completion will not be released to TOLD until these items are completed. Should some of this work still remain outstanding at time of closing, funds and/or documents may be escrowed to ensure the completion of this work, or closing may be delayed. Recommended Motion: Adopt a motion to approve the attached resolution which authorizes the execution of the Certificate of Completion for Meridian Crossings, Phase II, by the Acting Executive Director and Chair, contingent upon the completion of the outstanding work or other evidence to perform in lieu of completion. Basis of Recommendation: 1. Construction of the Phase II improvements is substantially complete and in accordance with the approved concept plans. but some outstanding issues remain. 2. TOLD has requested issuance of the Certificate of Completion for Meridian Crossings, Phase II. 3. TOLD is intending to close on the sale of Meridian Crossings, Phase II, on August 27, 1999. Alternative Recommendation: Deny approval of the Certificate of Completion until the outstanding issues are .. completed. Discussion/Decision Mode: TOLD requested issuance of the Certification of Completion for Meridian Crossings, Phase II, in order to process the Phase II sale transaction in a timely manner. Re a tfully submitted, e e en'~~vich Acting Executive Director SLD:cak Attachment .~ HRA RESOLUTION NO. ~°~~ RESOLUTION AUTHORIZING EXECUTION OF A CERTIFICATE OF COMPLETION FOR ''~ MERIDIAN CROSSINGS, PHASE II WHEREAS, the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota (HRA) entered into a Contract for Private Redevelopment (Contract) with Meridian Properties Real Estate Development L.L.C., a Minnesota limited liability company, d/b/a TOLD Development Company (Developer), dated November 6, 1995, pursuant to and in furtherance of the ILN Redevelopment Project heretofore adopted by the City and the Richfield Housing and Redevelopment Authority; and WHEREAS, the Contract obligated the Developer to construct certain improvements to the property identified in that Contract; and WHEREAS, Section 4.7 of the Contract required the HRA to furnish the Developer with a Certificate of Completion upon completion of the Phase II construction in accordance with Concept Plans; and WHEREAS, the Contract establishes the form for the Certficate of Completion in Exhibit B; and WHEREAS, staff has found the improvements to be in accordance with the terms of the Contract. NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority in and for the City of Richfield that the Acting Executive Director and HRA Chair are directed to execute the Phase II Certificate of Completion and deliver same to the Developer. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 16th day of August, 1999. Thomas E. Harms, Chair ATTEST: Michael Sandahl, Secretary EXHIBIT A ~~ Legal Description Lot 2, Block 3, CLOVERLEAF ADDITION, according to the recorded plat thereof, Hennepin County, Minnesota. EXHIBIT B CERTIFICATE OF COMPLETION The undersigned hereby certifies that Meridian Properties Real Estate Development L.L.C., a Minnesota limited liability company, d/b/a TOLD Development Company has fully and completely complied with its obligations under Article IV of that document entitled "Contract for Private Development." dated November 6, 1995, between THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD and MERIDIAN PROPERTIES REAL ESTATE DEVELOPMENT L.L.C., a Minnesota limited liability company, d/b/a TOLD Development Company, with respect to construction of the Improvements located on the tract of land described in the attached Exhibit A in accordance with the requirements of such document and is released and forever discharged from its obligations to constructing the Improvements under such above-referenced Article on the above-referenced tract. DATED: THE HOUSING AND REDEVELOPMENT AUTHORITY -IN AND FOR THE CITY OF RICHFIELD By Its Chairperson ,,. By lts Acting Executive Director HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. 53 Agenda August 16, 1999 Issue Statement: Acknowledgment and consent to the transfer of prope~ from Meridian Properties Real Estate Development L.L.C., d/b/a TOLD Development ompany to The State Teachers Retirement System of Ohio; Meridian Crossings Office Redevelopment Project, Phase II. Background: Meridian Properties Real Estate Development L.L.C., d/b/a TOLD Development Company (TOLD) is preparing to sell Phase II of Meridian Crossings to The State Teachers Retirement System of Ohio (Purchaser). The Contract for Private Redevelopment by and between the Richfield Housing and Redevelopment Authority (HRA) and TOLD, dated on November 6, 1995, (Redevelopment Contract) provides for the consent of the HRA as to certain assignments. At this time, TOLD is seeking the following approvals and consent from the HRA for the aforementioned sale transaction: 1. Approval of the CONSENT TO ASSIGNMENT agreement which assigns Meridian Crossings, Phase II, property to Purchaser does not constitute a default under the Redevelopment Contract nor does it alter or affect any payment due under the Limited Tax Increment Note to TOLD; 2. Approval of the CERTIFICATION AND ESTOPPEL CERTIFICATE which (a.) acknowledges the HRA's consent of the transfer of property; (b.) acknowledges compliance with the Redevelopment Contract except for provisions relating to Land Sale, Construction of Minimum Improvements, and Wage and Job Covenants; (c.) acknowledges that there are no outstanding defaults or claims; and (d.) verifies outstanding special assessments, balance due under the Limited Tax Increment Note, and current market value of property; and 3. HRA consent to the GENERAL WARRANTY ASSIGNMENT OF PROJECT CONTRACTS AND ASSUMPTION AGREEMENT which assigns all of TOLD's project contracts, representations, warranties, covenants, and agreements relating thereto for Phase II to Purchaser. These documents are attached for review. Also, TOLD will continue to manage the property utilizing the management services of Escom Properties, Inc. Recommended Motion: It is recommended that the HRA adopt a motion which does the following: 1. Approves the Consent to Assignment; 2. Approves the Certification And Estoppel Certificate; 3. Consents to the General Warranty Assignment of Project Contracts and Assumption Agreement; and 4. Authorizes the Chairperson and Acting Executive Director to take any and all actions necessary to execute the agreements m order to carry out the implementation of the actions requested by TOLD. Basis of Recommendation: 1. The Redevelopment Contract provides for the consent of the HRA as to certain assignments, including the sale of the project property. ~~ 2. TOLD has requested that the HRA approve and consent to certain agreements necessary for the sale transaction of Meridian Crossings, Phase II, to the Purchaser. 3. TOLD is intending to close on the sale of Meridian Crossings, Phase II, on or about August 27, 1999. 4. The HRA took similar action regarding the transfer of property with Phase I. Alternative Recommendation: There is no alternative recommendation for this action as this activity is permitted under the Redevelopmen# Contract. DiscussioNDecision Mode: TOLD requested the approval and consent of certain agreements in order to process the Phase II sale transaction in a timely manner. ~tfully sub ed, L. Devich Executive Director SLD:cak Attachments CONSENT TO ASSIGNMENT This CONSENT TO ASSIGNMENT ("Assignment") is made as of the day of 1999 by and among MERIDIAN CROSSINGS II LLC, a Minnesota limited liability company ("Redeveloper"), OTR, an Ohio general partnership, acting as nominee for The State Teachers Retirement Board of Ohio, a public pension fund created pursuant to the provisions of Chapter 3307 of the Ohio Revised Code ("Purchaser") and THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, MINNESOTA, a Minnesota public body corporate and politic (the "HRA'~. WITNESSETH: WHEREAS, Redeveloper's predecessor in interest, Meridian Properties Real Estate Development LLC, and HRA entered into that certain contract for private redevelopment dated November 6,1995, as amended by that certain first amendment to contract for private redevelopment dates as of Mazch 18, 1996, and as further amended by that certain second amendment to contract for private redevelopment dated as of September 6,1996, that certain third amendment to contract for private redevelopment dated as of Apri121, l 997 and that certain Letter of Understanding dated March 19, 1996 (as amended, the "Contract") which assignment of said Contract to Meridian Crossings II LLC ,was consented to by the HRA on, as to property more particulazly described on Exhibit "A" (the "Phase II Property"); and WHEREAS, Purchaser has agreed to purchase the Phase II Property and all improvements thereon; and WHEREAS, the Contract provides for the consent of HRA as to certain assignments; and WHEREAS, capitalized terms used herein that aze not otherwise defined herein shall have the meanings attributed to them in the Contract; NOW, THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: 1. Consent to Assig ent. HRA acknowledges that the Redeveloper's obligations under the Contract accruing subsequent to the date of transfer of Redeveloper's interest in the Property to Purchaser as to the Phase II Property is to be assigned to Purchaser and hereby gives its consent thereto. Such assignment shall not constitute a default under the Contract nor in any way alter or affect Redeveloper's rights to obtain any and all payments due under the Note described in Article VII of the Contract, which right is specifically reserved by Redeveloper and not assigned to Purchaser. 2. Parties Bound. This Agreement shall bind and inure to the Benefit of the successors and assigns of the parties hereto; provided that the Redeveloper shall not assign its rights and obligations hereunder without the consent of both the HRA and the Purchaser. 3. Only Written Amendments. This Agreement may not be modified in any manner or - terminated except by an instrument in writing executed by the parties hereto. "' i -- 4. Govenun~Law. This Agreement shall be governed by and construed under the laws of the State of Minnesota. IN WITNESS WHEREOF; the parties hereto have executed this Agreement as .of the month, day and year first written above. . MERIDIAN CROSSINGS II LLC, a Minnesota limited liability company By: Bryant. J. Wangard Its: Manager Address: Meridian Crossings Ii LLC -. 6385 Old Shady Oak Road Suite 120 _ Eden Prairie, MN 55344 Telecopy No. OTR, an Ohio general partnership, acting as nominee for The State Teachers Retirement Board of Ohio, a -- public pension fund created pursuant to the provisions of Chapter 330? of the Ohio Revised Code By: Its: Address: OTR The State Teachers Retirement System of Ohio 275 East Broad Street Columbus, OH 43215 ATTN: Director of Real Estate Assets Telecopy No.: 2 THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF RICHFIELD, MINNESOTA ~' By: Its: By: Its: Address: Telecapy No.: 3 STATE OF MINNESOTA ) SS COUNTY OF HENNEPIN ) Personally came before me this day of ,1999, theabove-named Bryant J. Wangard, as the Manager of Meridian Crossings II LLC, a Minnesota limited liability company, and to be known to be the person who executed the foregoing instrument and acknowledged the same in such capacity. Notary Public, State of Minnesota My commission: STATE OF ) SS COUNTY OF ) Personally came before me this day of , 1999, the above-named . as the of OTR, an Ohio general partnership, acting as nominee for The State Teachers Retirement Board of Ohio, a public pension fund created pursuant to the provisions, and to me known to be the person who executed the foregoing instrument and acknowledged the same in such capacity. Notary Public, State of My commission• STATE OF COUNTY OF SS Personally came before me this day of .1999, the above-named as the of The Housing and Redevelopment Authority in and for the City of Richfield, Minnesota, and to me known to be the person who executed the foregoing instrument and acknowledged the same in such capacity. Notary Public, State of My commission• 4 EXHIBIT "A" Phase II Property Lot 2, Block 3, CLOVERLEAF ADDITION Richfield, Minnesota CER'P.~IC.A.T7fOlh1' A1~1A ESTUPl?'E~, CER~'ICATE August ,1999 OTR, an Ohio general partnership c/o State Teachers Retirement Board of Ohio 275 E. Broad Street Columbus, Ohio 43215 Re; Contract for Private Redevelopment By and Between The Dousing and .Redevelopment Authority in and for the City of Richfield ("k~tC'~ and Meridian Properties Real Estate Development L.L.C., a IVlinnosota limited liability company dba Told Development Company ("Meridian's dated Noveatber 6,1995 as recorded by First Amendment to Comract for Private Redevelopment dated March 18, 1996; Second Amendment to Contract dated Soptember 5, 1996; and a Third Amendment to Contract for Private Redevelopment dated Apii121, 1997 (the agreement as amended is hereinafter referrod to as the "ltedevelopmwtt Agreement"j Gentlemen: This Certifiication and Estoppel Certificate is being executed by HRC ?n connection with the acquisition by OTIt, an Ohrio.general partnership ("QTR"j, ofthe Phase Y Px'operly (as defined in the Redevelopment Agreement) from Meridian with the Iwowledge that OTR, and its successors and assigns, are relying upon the same in completing said acquisition. 1. HRC hereby consents to the transfer of the Phase II Property to OTlt 2. Meridian and/or Meridian Crossing, L.L.C, a Minnesota limited liability compaxty (hereinafter collectively "1V1Ceridiaa''~ Dave complied with all of the obligations of the Redevelopment Agreement as they pertain, to the Phase II Property including but not limited to those contained in Article I1'I and Y'V and Section ] 1,5 thereof:' 3. There are no existing or clammed defaults on the part of Meridian or the undersigned under the terms of the Redevelopment Agreement; and there are no existing or claimed conditions that with the passage oftime or notice, would constitute a default on the part of Meridian, or the undersigned under the terms thereof. 4. Except as set Earth above, the Redevelopment Agreeirtent has not been amended, modified, supplemeated or superseded. 5. Upon its acquisition of the Phase TI Property, OTR shall have no obligations undez the Redevelopment Agreement with respect to the Redevelopment 1'roper[y as that term is defined therein. awn.toin2s2saa ~~ 6. As of the date hereof, the total amount of the special assessments which have or will - ,,. be levied against the Phase II Property in conn~ectiort wsth its current develvpmcnt is $,. -_",_~ ?. As of the date hereof; the correct amount owed. to Meridian under- the Limited Revenue Tax Increment Note far the phase II Property is $ 8. The current maxket value assessed far the Phase II Property and improvements thereon for ad valorem tax proposes is $ 9, HR.C acknowledges that: (a) OTR is purchasing Mexidian's interest in the Phase II Properly, {b) OTR and its succe~rs and assigns will be ~y~g upon the certification and statements contained herein and; except for the assurancos and certifiications.set forth herein, 4'I'R would not make the purchase. 10, This Cerdfiaation and Estoppel Cer(aificate shall inure to the benefit of OTR and its successors and assigns and shall be binding upon the undersigned its successors and assigns. The Housing and Redevelopment Authority of the City of Richfield, Minnesota By: Its; Chairma;a By: Its: Executive Director aiwrr.~o~as~saa~i r ! l..[. Ivv . oc~ uo% 11 yy 1G -1'J l L ~ 1 UI_.1J i1t UtLUr'I ItiV 1 n1G 4GU r 5 r 4 r'1-tat G GENERAL WARRANTY ASSIGNMENT OF PROJECT CONTRACTS AND ASSUMPTION AGREEMENT This General Warranty assignment of Project Contracts and Assumption Agreement (this "Agreement") is made and executed this _ day of August, 1998 (the "Closing Date"), by and between Meridian Crossings LLC, a Minnesota limited liabr7r'ty company having a business and mailing address of 6900 Wedgwood Road, Suite 100, Maple Grove, Minnesota 5531 ! ("Assignor"}. and OTR, an Ohio general partnership, acting as nominee for The State Teachers Retirem+errt Board of Ohio, a public pension fund created pursuant to the provisions of Chapter 3307 of the Ohio Revised Code, having its principal place of business at 275 East Broad Street, Columbus, OY~ 43215 ("Assignee"}. A. Assignor and Assignee have entered urto a Purchase Agreement, dated July 10. 1997 (the "Purchase Agreement"}, pursuant to wrhich Assignor has agreed to convey to Assignee that certain tract of land more particularly described in the Purchase Agreement (the "Land"), together with such other praperty interests as constitute slie "Property" (as defined in the Purchase Agreement}. B. Assignor desires to assign and. to transfer to Assignee alt of Assignor's right, title, and interest in, under, and to all of the "Project Contracts" (as heranafter defined), and Assignee desires to accept such assignment, subject to the terms acid conditions of this Agreement and the Purchase Agreement. C. The Land is commonly known as Meridian Crossings Phase 1. NOW, THEREFORE, for good and valuable consideration to Assignor in hand paid by Assignee, the receipt and sufficiency of which are hereby acknowledged, Assignor and Assignee, intending to be 1ega11y bound, do hereby agree as follows: Section 2. Assignment of Assignor's interest is Project Contracts. Assignor hereby assigns, transfers, and conveys to Assignee, e$'ective as of the "Closing Date" (as deSned in the Purchase Agreement), all of Assignor's tight, title, and interest ~ under, and to all of the service and maintenance contracts, inanagement agreements, and other written agreements. including a!I amendments and modiScations thereto, entered into by Assignor or its agents on it's behalf in connection with the maintenance, ownership, and operation of the Property that survive the "Closing" (as defined in the Purchase Agreement}, as more fully described on Schedule 1 attached hereto and made a part hereof (coUeaively, the "Project Contracts"). Section 2. Assignor's Represent:;ttons, Warranties, Covenants, ~ aad Agreements. Assignor represents and warrants to Assignee as follows: l1871.IUAI~(MAd ~ 1 r 1 LC IVG . GLJ VGA 11 ~ 10.1G t u - I ULL JCdtLUt''I ICIV I O1G 4CV f Jf 4 t-r-0.aG J (a) that each of the Project CDrttracts, true copiers of which have been deGuered by Assignor to Assignee, are in full force and effect; (b) that Assignor has good right and power to assign the Project Contracts; (c) that the interests hereby assigned to Assignee are free and clear from all encumbrances and that Assignor does warrant and will forever defend the same to Assignee against the lawful claims and demands of alt persons whatsoever; and (d) that no material default exists under the terms of airy of the Project Contracts in connection with ary of the conditions, covenants, and other provisions of such Project Contracts on the part of Assignor to be kept and perfor»ed and that no event has Decanted or condition exists that, with the passage of time the giving of notice, or both, may result im an occurrence of a material default under the teems of airy of the Project Contracts. Section 3, Assignee's Covenants and Agreements. Assignee hereby accepts the foregoing assignment and, by its acceptance, Assignee hereby assumes and covenants and agrees to keep and w perform ap ofthe terms, conditions, covenants, agreements, and provisions of the Project Contracts to be kept and performed by Assignor and accruing after the Closing Date. Section 4. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall for aA purposes be deemed to be an original, and all of which are identical. A!1 such counterparts together shall constitute but one instrument. Section S. Parties in Interest. This Agreement sha11 be binding upon, and shall inure to the benefit of, Assignor, Assignee, and their respective legal representatives, successors, and assigns. Section 6. Captions. The captions or headings at the beginning of each section of this Agreement are merely guides or labels for the convenience of the parties [o assist in identifying those sections, are not intended to be a part of thc.context of this Ageement, and shall not be deemed to modify, to explain, to enlarge, or to restrict any of the provisions of this Agreement. non.~a~o,;a~ ~ ~ Z f t L.C IVO. GGO VOA 11 yd 1G • 1G 1 L - I ULiJ LtVtLUt''1 ICIV I G1L ~ILU f G! 4 rNlat ~1 { IN WITNESS WHEREOF, Assignor and Assignee have executed and delivered this Genera! Warranty Assignment of Project Contracts and Assumption Agreement on the date first written above. ASSIGNOR Meridian Crossings LLC, a Nfinnesota limited liability company ay: Brvant ). anstard a ASSIGNEE: OTR, an Ohio general pargxxship, aering as nominee for The State Teachers Retirement Board of Ohia, a-public pension fund created pursuant to the provisions of Chapter 3307 of the Ohio Kevised Code By: Stephen A. Mitchell, general partner ~t>,n.r~l.~oeel ~ I 3 r l LC I VA . CJG.> V O~ i t y.9 1 G• 10 l L• I ULL LC V CLUY I ICIV I O 1 L HCi/ !~ f 4 1• HuC ~ SCHEDULEI Project Contrach e+o~zara~ooee+ . ~ ~1LC rvv. 0C0 UG%11 yy 10.10 LL•IULL LGVCLUr'IICIVI OlC kc.V fO(4 F 1 L.E Nc . 34:~ U?i3U ' 98 14 : GG 1 U : Tf~.p DEVELUFi1Er11• ti12 42~~ 7574 Muzak Limited PariAarship --Music Servfcos YNUt 0 ~~ 2~~ Coatraat for Private Redevelopmeat dated Novembor b, 1995 "" First Asnendrtteat to Contract far Private Redevelopment dated March I8, 1996 Second Amendment to Contract for Private Redavelopt~aent dated September d. 1996 Third Amendment to Contract for Private Redevelopment dated Aprit 21, 1997 Gc:ttcr of Understanding dated March 19, 1996 Assigastitent consented to by EIItA on Mazch ~4, 1997 (The AYtignment oftl+tt Contract is spe~tifiorlly sul-ject to ws~ignor's rettntian utl~li paymcnra urro nun and in the Coruna purcua+tl to nnlcie 7 of said Con-n+a/ Cur Yrivsto Neaevetopntmt.) HOUSING AND REDEVELOPMENT AUTHORITY HRA Letter No. s4 Agenda August 16, 1999 Issue Statement• Approval of proposed properly tax levy for payable year 2000 for certification to Hennepin County and set optional date for public budget hearing for the 1999 Revised/2000 Proposed budget and tax levy. Background: As required by the Truth in Taxation legislation, each taxing authority must certify its proposed tax levy for the payable year 2000 to the County Auditor on or before September 15, 1999. Taxing authority for the purpose of this requirement includes all counties, school districts, cities, towns and special taxing districts such as an HRA. No local unit of government is exempt from this requirement. In addition, certain taxing authorities must certify to the County Auditor the dates that have been selected for a Truth in Taxation hearing and for a continuation hearing (if necessary) by September 15, 1999. In those instances, the dates must not conflict with hearing dates of the county or the school district in which that taxing authority is located. Such hearings must be scheduled between November 29 and December 20, 1999. However, the Truth in Taxation law does not require the HRA to hold a Truth in Taxation hearing prior to adoption of a final levy. Instead, the final levy is adopted as part of the City's final certification. process. The HRA could, however, decide to hold a public hearing on the HRA budget and levy at some point in the future prior to the City's adoption of a final levy. It is currently anticipated that the City will hold a Truth in Taxation hearing in early December. The HRA could hold a public hearing at its regular November meeting. The Proposed 2000 HRA levy represents a 5.54% increase from the previous year's levy and is approximately $18,400 less than the maximum HRA levy established by law of .0144% of the City's .total market value. Recommended Motion: 1.. Adopt the attached resolution approving the 2000 Proposed and 1999. Revised Housing and Redevelopment Authority General levy. 2. Set a public budget hearing for 7:00 p.m. on November 15, 1999. Basis of Recommendation: 1. The Minnesota Truth in Taxation law requires adoption of a preliminary levy from each taxing authority. 2. The recommended levy is allowed under Minnesota levy limits, which are still in effect for housing and redevelopment authorities. .+• 3. The budget and accompanying proposed levy for 2000 are ready for consideration. 4. There is adequate time to meet the deadline for submission to Hennepin County. 5. Even though a Truth in Taxation hearing is not required by the State Statute, it would still be appropriate for the HRA to hold a public hearing on the budget and adopt a final levy sometime in November prior to the City's consideration of a final levy if the HRA desired to do so. Alternative Recommendation: 1. The HRA could adopt a preliminary levy less than the one proposed herein. However, that would not provide for programs which are recommended in the 1999 Revised/2000 Proposed budget. 2. The HRA could select a different date other than November 15 (regular November meeting) to conduct a-public hearing and adopt a final levy. 3. The HRA could simply proceed at a futur$ date to adopt the budget and levy without holding any public budget meeting. Discussion/Decision Mode: Action by the HRA on August 16 is necessary to certify a preliminary levy to the County within the Truth in Taxation sta#ute time frame. su ~ n L. 'c ~! Acting Executive Director SLD:cak HRA RESOLUTION NO. i~ RESOLUTION APPROVING PROPOSED 2000 HOUSING AND REDEVELOPMENT AUTHORITY BUDGET AND CERTIFYING THE 2000 TAX LEVY BE IT RESOLVED by the Housing and Redevelopment Authority of the City of Richfield, Minnesota as follows: Section 1. The budget for the Housing and Redevelopment Authority General Fund of Richfield for the year 2000 in the amount of $1,242,820 is hereby ratified. Section 2. The estimated gross revenue of the Housing and Redevelopment Authority General Fund of Richfield from all sources, including general ad valorem tax levies as hereinafter set forth for the year 2000, and as the same are more fully detailed in the Executive Director's official copy of the budget for the year 2000, in the amount of $1,134,390 are hereby approved. Section 3. There is hereby levied upon all taxable property in the City of Richfield an ad valorem tax in 1999, payable in 2000 for the following purposes: Housing and Redevelopment Authority $195,250 Section 4. A certified copy of this resolution shall be transmitted to the County Auditor. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 16th day of August, 1999. Thomas E. Harms, Chair ATTEST: Michael Sandahl, Secretary ~~ HRA RESOLUTION NO. RESOLUTION AUTHORIZING REVISION OF THE 1999 BUDGET OF THE HOUSING AND REDEVELOPMENT AUTHORITY OF RICWFIELD WHEREAS, Resolution No. 678 appropriated funds for personal services and other expenses and capital outlay for the Housing and Redevelopment Authority for the year 1999, and WHEREAS, The Acting Executive Director has requested a revision of the 1999 budget as detailed in the 2000 budget document. NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority of Richfield, Minnesota as follows: Section 1. That the 1999 appropriation for the Housing and Redevelopment Authority General Fund be revised as follows: $578,860 Increase Section 2. Es#imated 1999 gross revenue o~ the Housing and Redevelopment Authority General Fund ftom all sources, as the same are more fully detailed in the Executive Director's official copy of the 1999 budget document, are hereby revised as follows: $1,054,570 Increase Section 3. That the Executive Director bring into effect the provisions of this resolution. Adopted by the Housing and Redevelopment Authority in and for the City of Richfield, Minnesota this 16th day of August, 1999. Thomas E. Harms, Chair ATTEST: Michael Sandahl, Secretary