031119 EDA Meeting Packet
EDA MEETING
City Hall, 4401 Xylon Avenue North
Monday, March 11, 2019
President Kathi Hemken
Commissioner John Elder
Commissioner Cedrick Frazier
Commissioner Andy Hoffe
Commissioner Jonathan London
1. Call to order – EDA Meeting of March 11, 2019
2. Roll call
3. Approval of Minutes:
December 10, 2018
4. Resolution approving the sale of the scattered site lot located at 3856 Maryland
Avenue North (improvement project no. 1024)
5. Adjournment
EDA Meeting
Page 1 December 10, 2018
City of New Hope
4401 Xylon Avenue North
New Hope, Minnesota 55428
EDA Minutes December 10, 2018
Regular Meeting City Hall
CALL TO ORDER President Hemken called the meeting of the Economic Development Authority to
order at 9:06 p.m.
ROLL CALL Present:
Kathi Hemken, President
John Elder, Commissioner
Cedrick Frazier, Commissioner
Andy Hoffe, Commissioner
Jonathan London, Commissioner
Staff Present:
Kirk McDonald, City Manager
Aaron Chirpich, Community Development Specialist
Tim Fournier, Police Chief
Rich Johnson, Director of HR/Admin. Services
Valerie Leone, City Clerk
Chris Long, City Engineer
Susan Rader, Director of Parks and Recreation
Jeff Sargent, Director of Community Development
Steve Sondrall, City Attorney
Bernie Weber, Director of Public Works
Stacy Woods, Assistant City Attorney
APPROVAL OF
MINUTES
Item 3
Motion was made by Commissioner Hoffe, seconded by Commissioner Frazier, to
approve the minutes of November 13, 2018. All present voted in favor. Motion
carried.
EDA LEVY
Item 4
President Hemken introduced for discussion EDA Item 4, Resolution authorizing
the final levy of a special benefit levy pursuant to Minnesota Statutes, Section
469.033, subdivision 6 and approval of a final budget for fiscal year 2019.
Mr. Kirk McDonald, city manager, stated the EDA is asked to approve a $300,000
levy for 2019. He noted the levy is $100,000 greater than last year to provide for
increased funding of the scattered site housing program.
RESOLUTION 2018-23
Item 4
Commissioner Elder introduced the following resolution and moved its adoption
“RESOLUTION AUTHORIZING THE FINAL LEVY OF A SPECIAL BENEFIT
LEVY PURSUANT TO MINNESOTA STATUTES, SECTION 469.033,
SUBDIVISION 6 AND APPROVAL OF A FINAL BUDGET FOR FISCAL YEAR
2019.” The motion for the adoption of the foregoing resolution was seconded by
Commissioner Hoffe, and upon vote being taken thereon, the following voted in
favor thereof: Hemken, Elder, Frazier, Hoffe, London; and the following voted
against the same: None; Abstained: None; Absent: None; whereupon the
resolution was declared duly passed and adopted , signed by the president which
was attested to by the executive director.
EDA Meeting
Page 2 December 10, 2018
IMPROVEMENT
PROJECT NO. 1020
Item 5
President Hemken introduced for discussion EDA Item 5, Resolution approving
Purchase Agreement for the acquisition of 3924 Utah Avenue North
(improvement project no. 1020).
Mr. Aaron Chirpich, community development specialist, requested the EDA’s
approval of a purchase agreement for $190,100 for the acquisition of 3924 Utah
Avenue North. He stated the two-story home was constructed in 1961 and is in
need of maintenance. He recommended the home be considered for a
rehabilitation project and possibly as a “demonstration” project to showcase to
other residents. He noted there are several similar house designs in the
neighborhood.
Mr. Chirpich reviewed the scope of the work for the base bid and items to be
considered as alternates. He reviewed the proposed budget and stated with a
$300,000 sales price the loss/value gap may be $20,000. He stated EDA funds will
be used for the project.
Commissioner London advocated for a re-investment of properties and setting the
sales prices for the remodeled home as high a s possible. He commented that he
believes the land values set by Hennepin County are too low.
RESOLUTION 2018-24
Item 5
Commissioner London introduced the following resolution and moved its
adoption “RESOLUTION APPROVING PURCHASE AGREEMENT FOR THE
ACQUISITION OF 3924 UTAH AVENUE NORTH (IMPROVEMENT
PROJECT NO. 1020).” The motion for the adoption of the foregoing resolution
was seconded by Commissioner Elder, and upon vote being taken thereon, the
following voted in favor thereof: Hemken, Elder, Frazier, Hoffe, London; and the
following voted against the same: None; Abstained: None; Absent: None;
whereupon the resolution was declared duly passed and adopted , signed by the
president which was attested to by the executive director.
ADJOURNMENT Motion was made by Commissioner Frazier, seconded by Commissioner Elder, to
adjourn the meeting. All present voted in favor. Motion carried. The New Hope
EDA adjourned at 9:20 p.m.
Respectfully submitted,
Valerie Leone, City Clerk
I:\RFA\COMM DEV\2019\EDA\3-11-19\RFA - Sale of Lot at 3856 Maryland 3-11-19.docx
Request for Action
March 11, 2019
Approved by: Kirk McDonald, City Manager
Originating Department: Community Development
By: Aaron Chirpich, CD Specialist
Agenda Title
Resolution approving the sale of the scattered site lot located at 3856 Maryland Avenue North (improvement
project no. 1024).
Requested Action
This is a public hearing, and after receiving public comments, staff is requesting that the Economic
Development Authority (EDA) approve the attached resolution approving the sale of the EDA-owned property
located at 3856 Maryland Avenue North.
Policy/Past Practice
Proposals for the redevelopment of EDA-owned scattered site lots are reviewed by the EDA prior to executing
a contract with the preferred buyer/builder.
Background
Staff sent Request for Proposals (RFPs) to more than 20 builders marketing the lot located at 3856 Maryland
Avenue. The non-negotiable minimum lot sales price was set at $58,000, and builders were offered the chance
to submit a higher offer to make their proposal more competitive. The minimum lot sales price for this lot is
lower in comparison to other lots recently sold by the EDA, as the price was adjusted downward to account
for the required soil corrections at this location. These soil corrections, and the subsequent lower price, were
discussed in detail at the January 22, 2019 Work Session meeting. For more information regarding soil
corrections, please refer to the previously distributed packet for that Work Session. The EDA received
proposals for the development of 3856 Maryland Avenue from the following two builders:
Novak-Fleck, Inc.
Donnay Homes
Staff reviewed the proposals with the city manager. Upon review, staff found it difficult to distinguish a
superior proposal. Therefore, staff would like to review the characteristics and attributes of both proposals
with the EDA and select a preferred builder following deliberations at the public hearing. The primary
attributes for both proposals are listed below.
Donnay Homes Overview
Two-story home design
Above-average curb appeal
High-end trim package for the cabinets, flooring, doors, and fixtures
Granite kitchen counter tops
Five bedrooms
Main-floor fireplace
Tray ceilings in master bedroom
Master suite with walk-in closet
Agenda Section
EDA
Item Number
4
Request for Action, Page 2
Master bath is equipped with separate tile shower and soaker tub
Three-car garage
Two full baths, one ¾ bath, and one ½ bath (4 total)
3,201 finished square feet including a finished basement
Typical exterior finishes, vinyl siding with cultured stone accents
10’ X 10’ Concrete patio in rear of home
Land offer = $60,000
Anticipated sales price = $395,000
Novak-Fleck Overview
Two-story home design
Above-average curb appeal
High-level trim package for cabinets, flooring, doors, and fixtures
Granite kitchen counter tops
Main-floor fireplace
Four bedrooms
Three-car garage
One full bath, two ¾ baths, and one ½ bath (4 total)
Master suite with walk-in closet
Full tile master shower
2,805 finished square feet including a finished basement
Typical exterior finishes, vinyl siding with cultured stone accents
Land offer = $63,000
The home is pre-sold to a prospective buyer
Anticipated sales price = $394,000
Experience with Builders
Novak-Fleck is a moderate-sized home builder based out of Brooklyn Park, and the EDA has sold five lots to
them over the past five years. The lots purchased by the builder have been located at 6059 West Broadway
Avenue, 5431 Virginia Avenue, 9115 62nd Avenue, 9121 62nd Avenue, and 4511 Boone Avenue. Overall, staff
has been impressed by the quality of work completed by Novak-Fleck, and the builder has always delivered
what they propose. The plan submitted by Novak-Fleck is the same plan that was built at 4511 Boone Avenue.
The EDA has not sold a scattered site lot to Donnay Homes. However, the builder is a well-known locally-
owned company that has experience building high-end custom homes throughout the region. Donnay is
currently most active in the cities of Shakopee, Edina, Shorewood, Plymouth, and Burnsville. The builder
reported the construction and sale of 27 custom homes in 2018.
Development Agreement and Next Steps
Staff has worked with the city attorney to draft a purchase and redevelopment agreement for the sale of the
lot. The agreement ensures that the provisions set forth in t he RFP will be met. Once the agreement is fully
executed, staff anticipates that the closing of the lot sale will take place by the end of April. Construction of the
home will begin once weather permits.
Request for Action, Page 3
Recommendation
Staff recommends that the EDA review the submitted proposals and select a preferred builder for the lot located
at 3856 Maryland Avenue North. Approval of the attached resolution will allow staff to move forward with
executing a purchase and redevelopment agreement with the selected builder.
Attachments
Resolution
Public Hearing Notice
Proposals
RFP for Lot Sale
Minutes from the January 22, 2019 Work Session meeting
CITY OF NEW HOPE
ECONOMIC DEVELOPMENT AUTHORITY
EDA RESOLUTION NO. 19-___
RESOLUTION APPROVING SALE OF THE SCATTERED SITE LOT LOCATED AT
3856 MARYLAND AVENUE NORTH
(IMPROVEMENT PROJECT NO. 1024)
BE IT RESOLVED by the Economic Development Authority in and for the City of New
Hope (“EDA”) as follows:
WHEREAS, the EDA purchased that certain vacant parcel of real property located at 3856
Maryland Avenue North, New Hope, MN, and legally described as Lot 9, Block 4, Gwynnco
Second Addition, Hennepin County, MN (the “Property”) on September 5, 2018, with the intention
of selling the Property for the construction of a new single family home; and
WHEREAS, in response to a Request for Proposal (“RFP”) sent by New Hope City staff
to various builders, the EDA received an offer from ____________________, Inc. a Minnesota
corporation (“”) regarding the sale and redevelopment of the Property; and
WHEREAS, the EDA arrived at an agreement with _____________________, to sell the
Property for the purchase price of $__________________ upon all of the terms set forth in the
RFP; and
WHEREAS, it is in the best interest of the EDA to sell the Property to
__________________ for the sum of $______________________, in order for
__________________________ to redevelop and build a new single family home on the
Property in accordance with the City’s scattered site housing program and policy; and
WHEREAS, the City staff is hereby seeking approval from the EDA to execute a purchase
and redevelopment agreement with __________________________, for the sale of the Property.
NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in
and for the City of New Hope as follows:
1. That the above recitals are incorporated herein by reference.
2. That the sale of the Property by the EDA to _____________________, for the
purchase price of $_________________________, with other terms and conditions
to be set forth in a purchase and redevelopment agreement to be drafted by the City
Attorney, is approved subject to the review and approval by the City Attorney of
the final language and exhibits to the purchase and redevelopment agreement
relating to the closing on the sale of the Property, it being in the best interest of the
EDA to sell the Property for redevelopment and construction of a single-family
home in accordance with the City’s scattered site housing program and policy.
3. The EDA shall use due diligence for selling the Property to ________________,
for the construction of a single-family home, so as to return the Property to the tax
rolls for the benefit of all taxing jurisdictions.
4. The President, Executive Director and New Hope City staff are authorized and
directed to sign all appropriate documents, and to take whatever additional actions
are necessary or desirable, to complete the sale of the Property in accordance with
the Purchase and Redevelopment Agreement.
Dated the 11th day of March, 2019.
____________________________________
Kathi Hemken, President
Attest: _____________________________
Kirk McDonald, Executive Director
P:\Attorney\SAS\1 Client Files\2 City of New Hope\99-11427 Purchase 3856 Maryland Ave N from Crystal\Resolution Approving Sale of 3856
Maryland Avenue North.docx
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