021218 EDA Meeting Packet
EDA MEETING
City Hall, 4401 Xylon Avenue North
Monday, February 12, 2018
President Kathi Hemken
Commissioner John Elder
Commissioner Andy Hoffe
Commissioner Eric Lammle
Commissioner Jonathan London
1. Call to order – EDA Meeting of February 12, 2018
2. Roll call
3. Approval of Minutes:
January 8, 2018
4. Resolution approving extension of deadline for construction of new home by Great
Buy Homes, Inc. at 6065 Louisiana Avenue North (improvement project no. 973)
5. Adjournment
EDA Meeting
Page 1 January 8, 2018
City of New Hope
4401 Xylon Avenue North
New Hope, Minnesota 55428
EDA Minutes January 8, 2018
Regular Meeting City Hall
CALL TO ORDER President Hemken called the meeting of the Economic Development Authority to
order at 8:48 p.m.
ROLL CALL Present:
Kathi Hemken, President
John Elder, Commissioner
Andy Hoffe, Commissioner
Eric Lammle, Commissioner
Jonathan London, Commissioner
Staff Present:
Kirk McDonald, City Manager
Aaron Chirpich, Community Development Specialist
Tim Fournier, Police Chief
Valerie Leone, City Clerk
Chris Long, City Engineer
Susan Rader, Director of Parks and Recreation
Jeff Sargent, Director of Community Development
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 Elder, to
approve the minutes of December 11, 2017. All present voted in favor. Motion
carried.
IMP. PROJECT 1007
Item 4
President Hemken introduced for discussion EDA Item 4, Resolution approving
contract with JACON, LLC for demolition of site improvements, utility work, tree
removal, well sealing and site grading of 7303 62nd Avenue North (improvement
project no. 1007).
Mr. Aaron Chirpich, community development specialist, recommended the EDA
approve a contract with JACON, LLC for $15,875 for demolition, site grading, well
sealing, tree removal, and utility work at 7303 62nd Avenue North. He explained
the city’s experience with the contractor is limited, but JACON was the utility
contractor that installed water and sewer services for the Dunkin’ Donuts project
in New Hope. He noted staff from other cities that have utilized the contractor
have been satisfied.
Mr. Chirpich reported that EDA funds will be used to pay for the work. He also
noted prior to its demolition, the police and fire departments may use the property
for training purposes.
RESOLUTION 2018‐01
Item 4
Commissioner Elder introduced the following resolution and moved its adoption
“RESOLUTION APPROVING CONTRACT WITH JACON, LLC FOR
DEMOLITION OF SITE IMPROVEMENTS, UTILITY WORK, TREE
REMOVAL, WELL SEALING AND SITE GRADING OF 7303 62ND AVENUE
EDA Meeting
Page 2 January 8, 2018
NORTH (IMPROVEMENT PROJECT NO. 1007). The motion for the adoption of
the foregoing resolution was seconded by Commissioner Lammle, and upon vote
being taken thereon, the following voted in favor thereof: Hemken, Elder, Hoffe,
Lammle, 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 London, seconded by Commissioner Elder,
to adjourn the meeting. All present voted in favor. Motion carried. The New Hope
EDA adjourned at 8:53 p.m.
Respectfully submitted,
Valerie Leone, City Clerk
I:\RFA\COMM DEV\Development\Q & R ‐ Approve contract extension for 6065 Louisiana 2‐12‐18.docx
Request for Action
February 12, 2018
Approved by: Kirk McDonald, City Manager
Originating Department: Community Development
By: Aaron Chirpich, CD Specialist
Agenda Title
Resolution approving extension of deadline for construction of new home by Great Buy Homes, Inc. at 6065
Louisiana Avenue North. (Improvement Project No.973).
Requested Action
Staff requests the EDA approve a resolution extending the deadline for completion of a new single‐family
home at 6065 Louisiana Avenue North.
Policy/Past Practice
In the past, the city has renegotiated the terms of development contracts when circumstances call for
amendments that are beneficial to both parties.
Background
The EDA sold two side‐by‐side lots on Louisiana Avenue to Great Buy Homes, Inc. in October of 2016. Great
Buy Homes has completed construction of the first home on the north lot, and this home was sold on
February 1, 2018 for $324,000. Despite the recent sale, the builder has reported unexpected difficulties in
securing a buyer for the property, as the home sat on the market for several months before the sales contract
was secured. The builder indicated that the home received several showings, but many buyers expressed
concerns with the location.
Due to the extended marketing period for the first home, the builder was financially unable to start
construction of the second home. The resulting delay has caused a compliance issue with the development
contract between Great Buy Homes and the EDA, as the development agreement for the sale of the lots
stipulates that both homes will be completed within one year of the lot sales date. In this case, the deadline
for completion was October 27, 2017. In light of the circumstances, staff is supportive of granting an extension
to allow the builder more time to successfully complete the project and build the second home. The revised
contract designates a new completion deadline of February 12, 2019. The EDA last discussed this topic at the
January 16 work session, and the commission members present were supportive of granting the contract
extension.
Funding
Under the terms of the contract extension agreement, Great Buy Homes, Inc. will be responsible for attorney’s
fees associated with processing the amendment.
Attachments
Resolution
Location map
Excerpt from Work Session minutes ‐ 1/16/18
Amended Restrictive Covenant
Amended Assessment Agreement
Agenda Section
EDA
Item Number
4
CITY OF NEW HOPE
ECONOMIC DEVELOPMENT AUTHORITY
EDA RESOLUTION NO. 18-___
RESOLUTION APPROVING EXTENSION OF DEADLINE FOR
CONSTRUCTION OF NEW HOME BY GREAT BUY HOMES, INC.
AT 6065 LOUISIANA AVENUE NORTH
BE IT RESOLVED by the Economic Development Authority in and for the City of New
Hope (“EDA”) as follows:
WHEREAS, the EDA sold that certain real property located at 6065 Louisiana Avenue
North, New Hope, MN which was replatted as the following legal description: “Lot 2, Block 1,
McDonalds Addition to City of New Hope, Hennepin County, Minnesota” (“Property”), to Great
Buy Homes, Inc. (“Great Buy Homes”) on October 27, 2016; and
WHEREAS, as required by the Purchase and Redevelopment Agreement, Great Buy
Homes executed Restrictive Covenants and Assessment Agreement which required that a new
residential home be constructed on the Property no later than one year from the date of closing,
or by October 27, 2017; and
WHEREAS, Great Buy Homes has requested an extension until February 12, 2019 to
complete the construction of the residential home on the Property which necessitates the
amendment of both the Restrictive Covenants and the Assessment Agreement to permit this
extension; and
WHEREAS, it is in the best interest of the EDA to grant an extension to Great Buy
Homes in order for Great Buy Homes to complete the construction of 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 of the amendments
to the Restrictive Covenants and Assessment Agreement.
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 amendments of the Restrictive Covenants and the Assessment
Agreement between the EDA and Great Buy Homes, as set forth in the
Amendments attached hereto as Exhibit A, are approved, it being in the best
interest of the EDA to assist Great Buy Homes in the successful redevelopment
and construction of a single-family home on the Property in accordance with the
City’s scattered site housing program and policy.
3. 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 amend the Restrictive Covenants and Assessment
Agreement.
Dated the 12th day of February, 2018.
____________________________________
Kathi Hemken, President
Attest: __________________________
Kirk McDonald, Executive Director
P:\Attorney\SAS\1 Client Files\2 City of New Hope\99-21605 - 6065 Louisana Ave. N. Rezone and Plat\Resolution Approving Extension
regarding 6065 Louisiana Avenue North.docx
City Council Work Session January 16, 2018
Page 3
Mr. Alger responded the city will likely receive credit for completing the “new green
buildings” best practice (#3).
Council thanked staff for attaining Step 3 and the continued interest in the GreenStep
Cities program.
SCATTERED SITE
HOUSING
PROGRAM
Item 11.3
Mayor Hemken introduced for discussion item 11.3, Discuss the city’s scattered site
housing program.
Mr. Aaron Chirpich, community development specialist, updated Council regarding
scattered site housing projects currently underway and illustrated potential
redevelopment sites of residential properties.
Staff commented on various strategies for property acquisition and redevelopment to
support goals outlined in the comprehensive plan.
Discussion ensued regarding the 6065/6067 Louisiana Avenue North property. Mr.
Chirpich explained the home at 6067 Louisiana was constructed and is expected to sell
for $324,000. He stated the property was on the market for several months which
prevented the builder from starting construction on the second home. The location of
the property was cited as the primary reason for the delay in the sale. He noted the
development agreement called for completion of both homes by October 27, 2017.
Council supported staff’s recommendation to grant a one‐year extension to the builder
with no penalty assessment.
Mr. Chirpich stated an amended development agreement will be presented at the
February 12 EDA meeting.
Council discussed the use of realtors for marketing properties following property
rehabilitation. Assistant City Attorney Woods noted the competitive bidding law does
not apply for realtors as they are classified as a professional service.
Council supported the use of Tony Hawk for the sale of 3984 Zealand Avenue North.
Staff was directed to conduct research and draft a policy outlining the use of real estate
agents/realty companies related to the acquisition of properties and sale of city‐owned
properties.
The Council supported moving forward with a request for proposal process for the
new single‐family home construction at 7303 62nd Avenue and proceeding with
negotiations and appraisals, as appropriate, for 8109 62nd Avenue, 6035 West
Broadway and 5427 Yukon Avenue.
CITY‐OWNED
PROPERTY NEAR CP
RAILROAD TRACKS
Item 11.4
Mayor Hemken introduced for discussion item 11.4, Discussion regarding the future
use of city‐owned property adjacent to C.P. Railroad tracks.
Mr. Aaron Chirpich, community development specialist, stated during the past 20
years there have been various housing proposals for the 8‐acre site near the ice arena,
but none achieved fruition.
AMENDMENT TO RESTRICTIVE COVENANTS
6065 Louisiana Ave. N.
THIS AMENDMENT TO RESTRICTIVE COVENANTS (“Amendment”) is effective the
____ day of _________, 2018, by and between the Economic Development Authority in and for the
City of New Hope, a public body corporate and politic created pursuant to the laws of the State of
Minnesota (“EDA”) and Great Buy Homes, Inc., a Minnesota corporation (“Great Buy Homes”) (EDA
and Great Buy Homes sometimes jointly referred to as the “Parties”).
RECITALS:
A. The Parties (through documentation hereinafter recited) are parties to that certain
Assessment Agreement dated October 27, 2016 (“Restrictive Covenants”) imposing certain restrictions
relating to the sale from EDA to Great Buy Homes of certain real property located at 6065 Louisiana
Avenue North, New Hope and legally described as: “Lot 2, Block 1, McDonalds Addition to City of
New Hope, Hennepin County, Minnesota” (“Property”). The Restrictive Covenants were filed in the
office of the County Recorder, Hennepin County, Minnesota on November 2, 2016 as Document No.
A10375930.
B. The Restrictive Covenants are currently in full force and effect according to its terms
and conditions and the Parties have agreed to extend the date by which Great Buy Homes is required to
have constructed a new residential home on the Property until February 12, 2019.
C. The EDA and Great Buy Homes are mutually desirous of amending the Restrictive
Covenants as more fully set forth herein.
NOW, THEREFORE, for $1.00, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by the Parties, the EDA and Great Buy Homes agree as
follows:
1. Adoption by Reference of Recitals. The Recitals above, are incorporated herein by
reference, and constitute a material part of this Amendment between the Parties.
2. Amendment of the third “Whereas”. The third “Whereas” shall be deleted and
replaced in its entirety with the following language:
WHEREAS, the EDA and Great Buy Homes have agreed Great Buy Homes shall
complete the construction of the home as described in the Purchase Agreement no later
than February 12, 2019.
3. Amendment of Paragraph 4 of the Restrictive Covenants. Paragraph 4 of the
Restrictive Covenants shall be amended to replace the reference to the date “October
27th, 2017” with “February 12, 2019.”
4. Representations, Warranties and Covenants. The EDA and Great Buy Homes
represent, warrant and covenant as follows:
a. With the exception of the modifications recited above and as specified herein, the
Restrictive Covenants have not been changed, altered, modified or amended in any
way prior to the date hereof.
b. As modified by this Amendment, the Restrictive Covenants, constitute a legal, valid
and binding obligation of Great Buy Homes enforceable by the EDA in accordance
with its terms.
5. EDA Costs. Great Buy Homes shall pay contemporaneous with the execution of this
Amendment the EDA’s costs incurred in connection with this Amendment including without limitation
attorney’s fees.
6. Release of EDA. Great Buy Homes releases and forever discharges the EDA, and the
EDA’s past and present, representatives, successors and assigns o f a n d f r o m a n y a n d a l l c l a i m s ,
demands, obligations, actions or causes of action, at law or in equity whether arising by contract,
statute, common law or otherwise both direct and indirect, known or unknown of whatsoever kind or
nature arising out of or by reason of or in connection with the Restrictive Covenants, this Amendment
or any acts omissions or conduct occurring on or before the effective date of this Amendment.
IN WITNESS WHEREOF, the Parties have executed this Amendment effective the date first
above written.
ECONOMIC DEVELOPMENT
AUTHORITY IN AND FOR THE
CITY OF NEW HOPE
By: ________________________________
Kathi Hemken
Its: President
Dated: ___________ ____, 2018
By: ________________________________
Kirk McDonald
Its: Executive Director
Dated: ___________ ____, 2018
GREAT BUY HOMES, INC.
By: ________________________________
Glenn Hammer
Its: President
Dated: ___________ ____, 2018
STATE OF MINNESOTA
COUNTY OF HENNEPIN
}ss.
The foregoing instrument was acknowledged before me this ___ day of ___________, 2018, by
Kathi Hemken and Kirk McDonald, the President and Executive Director of the Economic
Development Authority in and for the City of New Hope, a public body corporate and politic created
pursuant to the laws of the State of Minnesota.
(Notary Public Seal)
_______________________________________
Notary Public
STATE OF MINNESOTA } ss.
COUNTY OF ____________
The foregoing instrument was acknowledged before me this ____ day of ____________, 2018,
by Glenn Hammer, the President of GREAT BUY HOMES, INC., a Minnesota corporation, on behalf
of said corporation.
(Notary Public Seal)
____________________________________
Notary Public
Drafted By:
JENSEN SONDRALL PERSELLIN & WOODS, P.A.
8525 Edinbrook Crossing, Suite 201
Brooklyn Park, MN 55443
(763) 424-8811
P:\Attorney\SAS\1 Client Files\2 City of New Hope\99-21605 - 6065 Louisana Ave. N. Rezone and Plat\Amendment to Restrictive Covenants - 6065 Louisiana Ave N.docx
AMENDMENT TO ASSESSMENT AGREEMENT
6065 Louisiana Ave. N.
THIS AMENDMENT TO ASSESSMENT AGREEMENT (“Amendment”) is effective the
____ day of _________, 2018, by and between the Economic Development Authority in and for the
City of New Hope, a public body corporate and politic created pursuant to the laws of the State of
Minnesota (“EDA”) and Great Buy Homes, Inc., a Minnesota corporation (“Great Buy Homes”) (EDA
and Great Buy Homes sometimes jointly referred to as the “Parties”).
RECITALS:
A. The Parties (through documentation hereinafter recited) are parties to that certain
Assessment Agreement dated October 27, 2016 (“Assessment Agreement”) imposing certain
requirements relating to the sale from EDA to Great Buy Homes of certain real property located at
6065 Louisiana Avenue North, New Hope and legally described as: “Lot 2, Block 1, McDonalds
Addition to City of New Hope, Hennepin County, Minnesota” (“Property”). The Assessment
Agreement was filed in the office of the County Recorder, Hennepin County, Minnesota on November
2, 2016 as Document No. A10375929.
B. The Assessment Agreement is currently in full force and effect according to its terms
and conditions and the Parties have agreed to extend the deadline by which Great Buy Homes is
required to have constructed a new residential home on the Property until February 12, 2019.
C. The EDA and Great Buy Homes are mutually desirous of amending the Assessment
Agreement as more fully set forth herein.
NOW, THEREFORE, for $1.00, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by the Parties, the EDA and Great Buy Homes agree as
follows:
1. Adoption by Reference of Recitals. The Recitals above, are incorporated herein by
reference, and constitute a material part of this Amendment between the Parties.
2. Amendment of Paragraph 1 of the Assessment Agreement. Paragraph 1 of the
Assessment Agreement shall be amended to replace the reference to the date “October
27th, 2017” with “February 12, 2019.”
3. Amendment of Paragraph 2 of the Assessment Agreement. Paragraph 2 of the
Assessment Agreement shall be amended to replace the reference to the date “October
27th, 2017” with “February 12, 2019.”
4. Representations, Warranties and Covenants. The EDA and Great Buy Homes
represent, warrant and covenant as follows:
a. With the exception of the modifications recited above and as specified herein, the
Assessment Agreement has not been changed, altered, modified or amended in any
way prior to the date hereof.
b. As modified by this Amendment, the Assessment Agreement constitutes a legal,
valid and binding obligation of Great Buy Homes enforceable by the EDA in
accordance with its terms.
5. EDA Costs. Great Buy Homes shall pay contemporaneous with the execution of this
Amendment the EDA’s costs incurred in connection with this Amendment including without limitation
attorney’s fees.
6. Release of EDA. Great Buy Homes releases and forever discharges the EDA, and the
EDA’s past and present, representatives, successors and assigns o f a n d f r o m a n y a n d a l l c l a i m s ,
demands, obligations, actions or causes of action, at law or in equity whether arising by contract,
statute, common law or otherwise both direct and indirect, known or unknown of whatsoever kind or
nature arising out of or by reason of or in connection with the Assessment Agreement, this
Amendment or any acts omissions or conduct occurring on or before the effective date of this
Amendment.
IN WITNESS WHEREOF, the Parties have executed this Amendment effective the date first
above written.
ECONOMIC DEVELOPMENT
AUTHORITY IN AND FOR THE
CITY OF NEW HOPE
By: ________________________________
Kathi Hemken
Its: President
Dated: ___________ ____, 2018
By: ________________________________
Kirk McDonald
Its: Executive Director
Dated: ___________ ____, 2018
GREAT BUY HOMES, INC.
By: ________________________________
Glenn Hammer
Its: President
Dated: ___________ ____, 2018
STATE OF MINNESOTA
COUNTY OF HENNEPIN
}ss.
The foregoing instrument was acknowledged before me this ___ day of ___________, 2018, by
Kathi Hemken and Kirk McDonald, the President and Executive Director of the Economic
Development Authority in and for the City of New Hope, a public body corporate and politic created
pursuant to the laws of the State of Minnesota.
(Notary Public Seal)
_______________________________________
Notary Public
STATE OF MINNESOTA } ss.
COUNTY OF ____________
The foregoing instrument was acknowledged before me this ____ day of ____________, 2018,
by Glenn Hammer, the President of GREAT BUY HOMES, INC., a Minnesota corporation, on behalf
of said corporation.
(Notary Public Seal)
____________________________________
Notary Public
Drafted By:
JENSEN SONDRALL PERSELLIN & WOODS, P.A.
8525 Edinbrook Crossing, Suite 201
Brooklyn Park, MN 55443
(763) 424-8811
P:\Attorney\SAS\1 Client Files\2 City of New Hope\99-21605 - 6065 Louisana Ave. N. Rezone and Plat\Amendment to Assessment Agreement - 6065 Louisiana Ave N.docx