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051099 EDA -- Official File Copy CITY OF NEW HOPE EDA MEETING City Hall, 4401 Xylon Avenue North May 10, 1999 President VV. Peter Enck Commissioner Sharon Cassen Commissioner Don Collier Commissioner Pat LaVine Norby Commissioner Mark Thompson 1. Call to Order 2. Roll Call 3. Approval of Regular Meeting Minutes of April 12, 1999, and April 26, 1999; and Closed Session Meeting Minutes of April 26, 1999 4. Resolution Authorizing Appraisals and Commencement of Negotiations to Acquire 7500 42nu Avenue North (Improvement Project No. 474) 5. Discussion Regarding Request for Financial Assistance for Potential Rehabilitation Project at 8113 Bass Lake Road 6. Adjournment CITY OF NEW HOPE 4401 XYLON AVENUE NORTH NEW HOPE, MINNESOTA 55428 Approved EDA Minutes April 12, 1999 Regular Meeting City Hall CALL TO ORDER President Enck called the meeting of the Economic Development Authority to order at 7:56 p.m. ROLL CALL Present: Enck, Cassen, Collier, Norby, Thompson Staff Present: Sondrall, Hanson, Donahue, Leone, McDonald, Johnson, Coone, Rudolph, Watts APPROVE MINUTES Motion was made by Commissioner Cassen, seconded by Commissioner Collier, to approve the Regular Meeting Minutes of March 22, 1999. All present voted in favor. Motion' carried. NW I-IENNEPIN President Enck introduced for discussion Item 4, Resolution Exploring the DEVELOPMENT Establishment of the NW Hennepin Development Coalition. COALITION Item 4 EDA Commissioner Collier introduced the following resolution and moved its adoption: RESOLUTION 99-05 "RESOLUTION EXPLORING THE ESTABLISHMENT OF TIlE NW HENNEPIN DEVELOPMENT COALITION". The motion for the adoption of the foregoing resolution was seconded by Commissioner Norby, and upon vote being taken thereon, the following voted in favor thereof: Enck, Cassen, Collier, Norby, Thompson; 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 Thompson, seconded by Commissioner Norby, to adjourn the meeting. All present voted in favor. Motion carried. The New Hop6 EDA adjourned at 7:57 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA April 12, 1999 Page 1 CITY OF NEW HOPE 4401 XYLON AVENUE NORTH NEW HOPE, MINNESOTA 55428 Approved EDA Minutes April 26, 1999 Regular Meeting City Hall CALL TO ORDER President Enck called the meeting of the Economic Development Authority to order at 8:06 ~.m. ROLL CALL Present: Enck, Cassen, Collier, Norby, Thompson Staff Present: Sondrall, Hanson, Donahue, Leone CLOSED MEETING President Enck introduced for discussion Item 3, Resolution Authorizing and Item 3 Calling for a Closed Meeting of the New Hope Economic Development Authority. Mr. Donahue stated the closed meeting will allow the City Attorney to update the EDA on the Spur Gas Station condemnation as it relates to the Project for Pride in Living Project No. 614. EDA Commissioner Collie3 introduced the following resolution and moved its adoption: RESOLUTION99-06 "RESOLUTION AUTHORIZING AND CALLING FOR A CLOSED MEETING OF THE NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY". The motion for the adoption of the foregoing resolution was seconded by Commissioner Thompson, and upon vote being taken thereon, the following yoted in favor thereof: Enck, Cassen, Collier, Norby, Thompson; 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 Collier, seconded by Commissioner Thompson, to adjourn the meeting. All present voted in favor. Motion carried. The New Hope EDA adjourned at 8:07 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA April 26, 1999 Page 1 CITY OF NEW HOPE 4401 XYLON AVENUE NORTH NEW HOPE, MINNESOTA 55428 Approved EDA Minutes April 26, 1999 Closed Session City Hall CALL TO ORDER President Enck called the closed meeting of the Economic Development Authority to order at 8:08 p.m. ROLL CALL Present: Enck, Cassen, Collier, Norby, Thompson Staff Present: Sondrall, Hanson, Donahue, Leone IMP. PROJECT 614 Mr. Steve Sondrall, City Attorney, provided an update regarding the settlement strategies .in connection with the Spur Gas Station (7300 Bass Lake Road) condemnation relative to the Project for Pride in Living, Inc. Project (Improvement Project No. 614). MOTION Motion was made by Commissioner Cassen, seconded by Commissioner Thompson, authorizing the City Attorney to settle the case for a specified amount as recommended by the City Attorney. All present voted in favor. Motion carried. ADJOURNMENT Motion was made by Commissioner Collier, seconded by Commissioner Thompson, to adjourn the meeting. All present voted in favor. Motion carried. The New Hope EDA adjourned its closed meeting at 8:15 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA April 26, 1999 Page 1 Originating Department Approved for Agenda Agenda Section EDA Community Development 95) 5-10-9 Item No. ByKirk McDonald By:. 4 RESOLUTION AUTHORIZING APPRAISALS AND COMMENCEMENT OF NEGOTIATIONS TO ACQUIRE 7500 42ND AVENUE NORTH (IMPROVEMENT PROJECT NO. 474) ACTION REQUESTED Staff recommends that the EDA approve the attached resolution authorizing the necessary appraisals and the commencement of negotiations to acquire the property located at 7500 42nd Avenue for redevelopment purposes. POLICY/PAST PRACTICE Since the early 1990s, the City has taken a number of actions to acquire the three industrial properties located at the northeast corner of 42"d and Quebec Avenues for redevelopment purposes. The City acquired and demolished the Electronic Industries building at 7516 42nd Avenue in 1993, and the City acquired and demolished the Foremost building at 7528 42nd Avenue between 1993 and 1995. One property remains to be acquired at 7500 42"~ Avenue. Over the years, the City has had a number of conversations with the property owner, Terry Jensen, regarding the potential acquisition of the property by the City and the City has had three appraisals completed on the property in 1992, 1996, and 1997. Ardel Engineering is a tenant in the building located on the site. In August 1997, the EDA approved a resolution authorizing the commencement of eminent domain proceedings to acquire the property at 7500 42"d Avenue North, but the action has not been implemented. The environmental cleanup and future redevelopment of the three industrial sites located at the northeast corner of Quebec Avenue and 42nd Avenue is identified as a goal of the Comprehensive Plan. (cont'd.) MOTION BY -'~,~/'~ SECOND BY ~~ ! Request for Action Page 2 5-10-99 BACKGROUND The owner of the property has recently been in contact with the City again to inquire about the City's interest in acquiring the property. Ardel Engineering's lease will terminate on May 31 and an agreement was not reached between the owner and tenant to renew the lease. Ardel Engineering is in the process of vacating the building and is relocating to Science Industry Park in the City. The property owner is in the process of marketing the property. Due to the fact that the building is being vacated, the City would have no responsibility for relocation costs. Per the City Attorney's correspondence, it appears that now is an opportune time to recommence discussion with the property owner regarding the EDA's purchase of 7500 42"d Avenue. The opportunity presents itself due to the pending vacation of the property by the current tenant, Ardel Engineering, by June 1. The enclosed resolution authorizes the EDA to obtain an updated appraisal of the property and commence negotiations with the property owner for.acquisition of the property as of June 1, when the property officially becomes vacant and unoccupied. This will allow the City to avoid payment of tenant relocation expenses, which has been the policy for acquisition of all properties initiated by an owner's request to sell to the City or EDA under the scattered site acquisition policy. The owner has recently obtained his own appraisal of the property indicating a market value of $545,000. Once the City has its appraisal on the property updated, the EDA will need to determine the dollar amount it is willing to authorize as a ceiling for acquisition. The owner has also indicated that he wants to be reimbursed for lost rent during the month of June in the event he agrees to keep the property vacant, so there should be some discussion concerning the amount of a non-refundable payment to the property owner in consideration for his agreement to keep the property vacant during the negotiation period. Lastly, the City Attorney points out that the attorney for the property owner has become his law partner, since last dealing with the property owner in 1997, and the EDA should be aware of and discuss this issue. ATTACHMENTS · Resolution · 5/5 City Attorney Correspondence · Site Map · Lease Termination Letter · Comprehensive Plan Excerpts EDA RESOLUTION NO. 99- RESOLUTION AUTHORIZING APPRAISALS AND COMMENCEMENT OF NEGOTIATIONS TO ACQUIRE 7500 - 42~° AVENUE NORTH BE IT RESOLVED by the Economic Development Authority in and for the City of New Hope as follows: WHEREAS, the Economic Development Authority in and for the City of New Hope (hereafter EDA) adopted Resolution No. 97-07 (copy attached as Exhibit A) at its August 25, 1997 meeting authorizing acquisition of the property at 7500 - 42"a Avenue North by direct negotiation or eminent domain; and WHEREAS, the Director of Community Development in his February 25, 1999 letter informed the owner of 7500 - 42"~ Avenue North the City/EDA was not interested in acquiring the property at the present time based on the lack of a specific development plan or developer for the property (copy of letter attached as Exhibit B); and WHEREAS, the EDA does hereby ratify and approve the action taken by the Director of Community Development as set out in his February 25, 1999 letter; and WHEREAS, the EDA has subsequently learned the property will become vacant and unoccupied as of June 1, 1999; and WHEREAS, acquisition of the property during a period when it is vacant and unoccupied will permit the EDA to avoid payment of tenant relocation expenses required by the Federal Uniform Relocation and Assistance Act and Minn, Stat. Chap. 117; and WHEREAS, the EDA has previously authorized an appraisal for this property to determine a fair market value and purchase price in the event its acquisition can be obtained; and WHEREAS, the prior EDA appraisals should be updated to establish the property's current fair market value; and WHEREAS, the owner of the property has informed the EDA he is willing to keep the property vacant after the current tenant vacates the premises until July 1, 1999 upon payment of a non-refundable fee as reimbursement for lost rent to assist the EDA in avoidance of incurring tenant relocation expenses upon acquisition of the property; and WHEREAS, the owner has also informed the City he has recently had completed an appraisal of the property indicating a market value of $545,000.00. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of New Hope, Minnesota, as follows: 1. That the foregoing recitals are incorporated by reference. 2. That the action taken by the Director of Community Development in his February 25, 1999 letter is approved and ratified as the action of the EDA and had the effect of nullifying the EDA's direction set out in Resolution No. 97-07. 3. That the Executive Director is directed to obtain an updated appraisal of the property, which appraisal will provide the property's fair market value. 4. That the Executive Director is authorized and directed, as of June 1, 1999 or when the property becomes vacant which ever occurs later, to commence direct negotiations with the property owner to acquire the property at 7500 - 42nd Avenue North based on the market value indicated in the EDA appraisal or a fair negotiated amount determined at the discretion of the Executive Director but at a price not to exceed $ 5. That the Executive Director is authorized and directed to pay to the owner a non- refundable fee not to exceed $ to guarantee the property remains vacant during the month of June on condition said fee is applicable to the purchase price of the property in the event acquisition of the property is successful. 6. To take any other action determined necessary in the discretion of the Executive Director to acquire the property as per the conditions set out in this resolution. Adopted by the Economic Development Authority in and for the City of New Hope, Minnesota this l0th day of May, 1999. W. Peter Enck, President Attest: Daniel J. Donahue, Executive Director p:xAtto19~y\Cllll I~solutiom~l~DA - Rt~o Auth ApO - ?~0 4211d.v,~l FROM: NEW HOPE CITY HALL FAX NO.: 612 551 51D$ 09-04-9? 09:19A P.01 De~t. Phone · i EDA RE~OLUTION NO. 97- ~7 RESOLUTION AUTHORIZING CO~ENCEMENT OF EMINENT DOMAIN PROCEEDINGS TO ACQUIRE PROPERTY AT 7500 42ND AVENUE NORTH BE IT RESOLVED Dy the Economic Development Authority in and for the City of New HOpe, Minnesota as follows: WHEREAS, the Housing and Redevelopment Authority in and for the City of New Hope (hereafter the HRA) was established end organized within the City of New Hope under authorization of New Hog.e Code §2.30 et. seq. and Minn. St e~_. §462.415 et. seq,, and WHEREAS, the HRA, actin9 pursuant to the authority of Minn. Stat. §462.415 et. seq. established Redevelopment Plan 85-2, Redevelo414aent Project 85-2 and Tax Increment Financing Plan 85-2 by adoption of HRA Resolution No. 85-08 on December g3, 1985, and WHEREAS, Minnesota Law 1987, C. 291 § 48, which repealed Minn. · ., Stat. §462.415 et. seq. provided that all orders, resolutions, motions, plans and agreements and actions taken by any municipal housing and redevelopment authority organized or purported to be orQan~zed under Minn. Stat §462.&15 to 462.705 and Minnesota Law 1959 C. 545 § 1 to 19, and'taken or purported to be taken by any governing body, city planning commission or political subdivision of the state or public state body with respect to plans and projects are hereby declared va]id and effective, and WHEREAS, the New Hope City Council on December 23, 1985 approved the adoption of RedeYelopment Plan 85-2, Redevelopment Project 85-2 and Tax Increment Financing Plan 85-2 by its Resolution No. 85-129, and WHEREAS, the Economic Development Authority in and for the City of New Hope (hereafter the EDA) was organized and established within the City of New Hope by Ordinance No. 89-7 adopted by the City Council on March 27, 1989 under authorization of Minn. Stat, §469.090 et, seq., and WHEREA~, the EDA was transferred control, operation and authority over Redevelopment Plan 85-2, Redevelopment Project 85-2 and Tax Increment Financing Plan 85-2 Dursuant to HRA Resolution No. 89-4, City Resolution No. 89-73 and EDA Resolution No. 89-3, and 1 FROM: HEW HOPE CITV HALL FAX HO.: 612 531 5136 09-04-9? Bg:20A P.02 ~HER~A~, the property located at 7500 42nd Avenue North hereafter legally described is included in the Redevelopment Plan, Redevelopment Project and Tax Increment Financing Plan area: The East 1OO feet of the South 350 feet of Lot 5, Auditor's Subdivision No. 324, Hennepin County, Minnesota except road and alley. PID No. 17-118-21-22 0000, and WHEREAS, the goals and objectives of the Redevelopment Plan and Redevelopment Project include among others the following goals and objectives: a. provide compatible and complementary land uses; b. provide more homogeneous land uses and street treatment along 42nd Avenue in order to unify development and provide a positive image of the City; c. promote and secure development and redevelopment in a manner that atlows the most logical- and efficient arrangement and intensity of land uses; d. to undertake certain land acquisition, parcel assembly and parce] disposition necessary to eliminate substandard and non-conforming uses and bui]dings, and to assemble ]ogical conforming and more efficient building sites; e. to promove and secure the redevelopment of non-conforming ]and uses and substandard buildings in a way which provides a clearer definition of land uses and more efficient utilization of parcels; and WHEREAS, the Economic Development Authority in,and for the City of New Hope does hereby determine that the acquisition of this property is reasonably necessary and convenient to the furtherance of the referenced goals and objectives of the redevelopment plan and redevelopment project, and that in its judgment the acquisition of this property will be for the benefit of the public health, welfare and safety of the citizens of New Hope, and WHEREAS, an appraisal of this property has been previously okdered by the EDA and that said appraisal has been completed as of May 28, 1997 establishing a fair market value for the subject property of $344,0OO.00, and FROM: NEW H'OPE CITY HALL FAX NO.: 612 531 5156 09-04-9? 09:20A P.03 ,, ~HEREA~, Minn. Stat. §117,232 authorizes the EPA to acquire the subject property by direct, purchase in lieu of eminent domain proceedings, and WHEREAS, Minn. Stat. §¢69.101, Subd. 4 gives the Economic Development Authority in and for the City of New Hope the authority to acquire property by power of eminent domain under Minn. Stat. Chapter 117, including the power of acquiring possession of the property per the "quick-take" provisions of §117,042, if necessary to carry out the redevelopment plan and redevelopment project, and WHEREAS, the Economic Development Authority ~n and for the city of New Hope has determined it is necessary to acquire this property by direct purchase or eminent domain proceedings, and WHEREAS, said redevelopment plan and redevelopment project were established under the authority of Minn. Stat. Chap. 462 pursuant to various studies undertaken by the City of New Hope which have shown that certain redevelopment activities in the plan area are warranted and would no~ have occurred through private development alone. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of New Hope as follows: 1. That the Executive Director is hereby directed and authorized to acquire by direct purchase at the appraisal value of $344,000.00 the property at 7500 42nd Avenue North in the City of New Hope, ~egal]y described as follows: The East 100 feet o¢ the South 350 feet of Lot 5, Auditor's Subdivision No. 324, Hennepin County, Minnesota except road and alley. PIP No. 17-118-21-22 000§. In addition to this amount, the Executive Director is authorized to pay all reasonable closing costs associated with the purchase of property. Further, the Executive Director is authorized to retain a relocation expert to determine the amount of relocation expenses the EPA must pay by law a~ a result of this acquisition and pay to th'e appropriate parties all required relocat ion expenses as determined. ~f direct purchase is unsuccessful, the Executive Director is authorized and directed to commence eminent domain proceedings under Minn, St~.~. C~apter 117 to acquire the subject property. 2. That the Executive Director i~ further directed to utilize the "quick-take" procedure per Minn. Stat. §117.042 if in '--' 3 FROM: NEU HoPE CITV HRLL FRX NO,: 612 531 $1J$ 89-04-9? 09:20~ P.04 the judgment of the Executive Director it is necessary to acquire possession of the property prior to the conclusion of the eminent domain proceedings. 3, That the Executive Director is hereby directed and authorized to obtain additional appraisals necessary to est&b]ish fair market value and just compensation for said property in preparation for said eminent domain proceedings. , Adopted by the Economic Developmen~ Authority in and for the City o¢ New Hope this 25th day of August, 1997. W, Peter Enck, President Attest: _ Daniel J, ~onahue, Executive Director 4401XylonAvenue North City Hall: 612-531.5100 CityHall Fax: 612-531.5 ~3~ New Hope, Minnesota 55428.4696 Police: 612.531.5170 Police Fax: Pubiic Works: 812.533.4822 Public Works Fax: 6~2-533.7~,¢2 TDO: 612-53f-5109 Fire Dep't. Fax: ~12-53~-Er75 February 25, 1999 Mr. Terry Jensen 5600 Vicksburg Lane North Plymouth, MN 55446 Subject: City's Potential Acquisition of 7500 42"~ Avenue Dear Mr. Jensen: Thank you for taking time to meet with City Manager Dan Donahue and me on February 8 to discuss the City's potential acquisition of your property at 7500 42'''~ Avenue. The City Ma.n. ager has requested that I inform you that the City has no immediate plans for developing the property and that you should proceed to do whatever you feel is necessary with your current tenant. The City does have an interest in acquiring the property in the future. However, due to a number of other projects the City is currently involved with, the City has not had adequate time to develop plans on how the property could be redeveloped. It is our feeling that until such time as plans are developed and approved by the City Council, the Council would probably not be in favor of acquiring the site. Thanks again for meeting with us. I hope that we can communicate in a cooperative manner on this subject in the future. Sincerely, Kirk McDonald Director of Community Development cc: Dan Donahue, City Manager Steve Sondrall, City Attorney Doug Sandstad, Building Official Valerie Leone, City Clerk, (improvement Project #.474) Family Styled City ' ~'; ~ For Family Living JENSEN SWANSON & SONDRALL, P.A. Attorneys At Law 8525 EDINBROOK CROSSING, STE. 201 BROOKLYN PARK, MINNESOTA 55443-1999 TELEPHONE (612) 424-8811 · TELEFAX (612) 493-5193 GORDON L. JENSEN* E-MAIL jss~jsspa.com WILLIAM G. SWANSON STEVEN A. SONDRALL May 5, 1999 MARTIN P. MALECHA C. ALDEN PEARSONt DEAN A. TRONGARD']' Kirk McDonald JULIE A. THILL Community Development Director City of New Hope OF COUNSEL 4401 Xylon Avenue North LORENS Q. BRYNESTAD New Hope, MN 55428 Re: Acquisition of Property at 7500 - 42~a Avenue North Our File No.: 99.11111 Dear Kirk: Please f'md enclosed for consideration at the EDA meeting on May 10, 1999 a proposed resolution Authorizing Appraisal and Commencement of Negotiations to Acquire 7500 - 42~ Avenue North. Notwithstanding your February 25, 1999 letter to the property owner, it appears this is now an opportune time to recommence discussion with the property owner regarding the EDA's purchase of 7500 - 42~ Avenue North. Basically, the opportunity presents itself due to the pending vacation of the property by the current tenant Ardel Engineering. It is my understanding Ardel Engineering is moving its operations to another location within the city as of the end of this month. As a result, the property at 7500 - 42~ Avenue North could be vacant as of June 1, 1999. The enclosed resolution authorizes the EDA to obtain an updated appraisal of the property and commence negotiations with the property owner Terry Jensen for the acquisition of the property as of June 1, 1999 when the property officially becomes vacant and unoccupied. As you know, this will allow the City to avoid payment of tenant relocation expenses which has been our policy for acquisition of all properties initiated by an owner's request to sell to the City or EDA under our scattered site acquisition policy. It is my understanding the owner has recently obtained his own appraisal of the property indicating a market value of $545,000. The enclosed resolution will require some discussion by the EDA concerning our opinion on market value and the dollar amount they are willing to authorize as a ceiling for acquisition discussion. We previously attempted to acquire this property for $344,000. This was based on our latest appraisal from BCL Appraisals dated May 28, 1997. Also, I note in my file that the City received a letter from the attorney for the property owner on April 23, 1993 offering to sell the property for $325,000 subject to 8 conditions (see copy enclosed). However, conditions 2, 3, 4, 6 and 7 made the 1993 offer to sell unacceptable to the EDA. I believe the 1993 offer was made · Real Pro~rty Law Sl~eialist c~,a ay ~ by the owner due to our recent acquisition of the foremost property at that time. Minn~ota Sram l~t Association '~Qualified ADR N~utral May 5, 1999 Page 2 It is my further understanding that the owner wants to be reimbursed for lost rent during the month of June in the event he agrees to keep the property vacant. As a result, there will need to be some discussion concerning the amount of a non-refundable payment to the property owner in consideration for his agreement to keep the property vacant during the negotiation period. I have left a blank space in the resolution for this item as well. I believe the owner has informed us his monthly rent for the property is approximately $4,900. I also want to make it clear that the attorney for the property owner is my law panner. However, in 1993 and 1997 I was not in a parmership with the owner's attorney. This situation should be discussed at the EDA meeting as well. If you have any questions or comments regarding the enclosed resolution or the information contained in this letter, please contact me. Very t,ruly yours, Steven A. Sondrall JENSEN SW^NSON & SONr~LL, P.^. Enclosures cc: Daniel J. Donahue Valerie Leone CNH 11111-01-Kirk Ltr.wpd JENSEN & SWANSON, P.A. A~o~NkYs ^T I~w 8525 E~Naa~ Su~Ts ~20 B~,w P~. Mm~r~ 55443 WILIJ~M G, SWANSON April 23, 1993 (612) 424-8811 ~c}c. mDD.. ~tPa, JR. ~x.~ L~L~O,mD Fay (612) 493-5193 Da~ d. OF d,m~ P. o/O Kirk ~cDonald 4401 Xylon Avenue North New Hope, NN 55428 Re: 7516 - 42nd Avenue North New Hope, ~±nnesota "Ardel Engineering" Property Dear ~r. ~cDonald: Z represent ~r. and ~rs. Terry ~ensen, the owners o£ the property at 7516 - 42nd Avenue North, New Hope, ~innesota. Signi£ioant issues have been raised, discussed and continue to evolve around the contamination and/or apparent contamination a££ecting property in the neighborhood o£ my client's property. It is my understanding £rom news reports, £ncluding speoi£icalZy the New Hope Post, dated April 21, 1993, that the New Hope Development Authority has acquired neighboring property at 7528 - 42nd Avenue North flor a purchase of 8450,000.00, with certain other accommodations made to the current owner. ~y clients are willing at this time to entertain an o££e= from the New Hope Economic Development Authority £or acquisition of their property at 7516 - 42nd Avenue North, New Hope, ~±nnesota. Further, ~r. ~ensen advises me that he would at the present time be willing to accept the sum of $325,000.00, subject to execution within the next thirty days of an acceptable purchase agreement ~hioh provides: l. A mutually acceptable closing date; 2. Continued possession of the property by my clients and the cUrrent tenants until December 31, 1995, with no expense to my clients except utilities and general maintenance; 3. A reservation of salvage rights to be exercised at the expiration of the period for possession; *Real Estate Specialist Ccrtillcd lly Thc Minnesota State Bar Association Page 2 4. Assumption by the City of all special assessments against the property; 5. Pro ration of the real estate taxes effective as of the date of closing; 6. Acceptance of the property in its "as is" condition effective as of the date rights to salvage expire; 7. S~ecific acceptance of the property without any responsibility for contamination and/or cleanup costs in regard to the property; 8. Reservation in the purchase agreement of a right to an exchange pursuant to the provisions of Section 1031 of the Internal Revenue Code. Please advise me as soon as possible as to whether the New Hope Economic Development Authority and/or the City of New Hope wish to present an offer to purchase as we are currently in ~he process of lease negotiations with a tenant. Your decision will bear on these negotiations in particular as to the length of term we offer for any extension. Thank you. Sincerely, Gordon L. Jenson GLJ/3mb cc: Terry Jensen bcc: Steve Sondrall 281\tlj12-3 April 29, 1999 Terry Jensen 5600 Vicksburg Lane Plymouth, MN 55446-1411 Dear Terry, I am writing to inform you that Ardel Engineering will be terminating our lease at 7500 42na Avenue North effective at midnight May 31, 1999. Please contact me with any questions or concerns. S incere~..--~ Frank Pichelman President 7500 42nd Ave. No. · Minneapolis, MN 55427 · Phone 6121533-5324 o{ ~ss L~ke ~d ~re~c~pe (multi-jur~dimion~ of medium ~nd high ~edeve~opmen¢ ~u~er ~ve~ue / Bass L~ke ~ Helium dens~ re~eve,o~mec~ ~bcont (Pond P)ace deve{opment o~po~unities) Industrial redeve!opment site (demolish existing building) expansion / cooperative rearrangement with Cit~ Sims Park parking and turnaround gle family r~evelopment oreo ',ommerciot red~elofment s~e~sc~pe ~Medium densi~ md~eJopment oppo~uni~ ~win Home~) [::)rminage issues Cornrnunity Perspective~ District 13 District 13 includes the residential neighborhoods surrounding Cooper High School. District 13 Issues · Land use compatibility issues with regard to the high school and adjoining neighborhoods generally relate to students leaving school (trespassing, loitering). · Reuse of the Homeward Bound facility in a manner that would be compatible with surrounding residential neighborhoods. · Some scattered site single family redevelopment or rehabilitation is needed for select sites in District 13. · Apartments located at Xylon Avenue and 45th Avenue face flooding and settling problems due to its proximity to adjoining wetland/ponding area. District 14 District 14 is a single family area located east of Winnetka. District 14 Issues · Development of the vacant site at the comer of 49th Avenue and Winnetka Avenue. · Deep single family lots along 49th Avenue may offer some opportunity for future redevelopment. District 15 District 1.5 consists of the industrial area along Quebec Avenue. District 15 Issues ·~ln'place expansio.__________~n o__f exi___stjn~_~ industri~ , at the' n~~er of Quebec Avenue and. 42nd Avenue. ~ CAh/of New Hope Comprehensive Plan Update  Planning TacScs .......... . ........................ , ...... Cornmunit)/Perspective,~ · Identification of the future land use of the Quebec Avenue/42nd Avenue site related. to the City's 42nd Avenue image. "~, District 15 This planning district includes areas of single family, multiple family and commercial land uses. Infrastructure improvements for the northern portion of the district are scheduled for year 2002. District 16 Issues · Scattered site single family redevelopment is needed for select sites throughout District 16. A concentration of candidate sites are located along the west side of Nevada Avenue between 42nd Avenue and 45th Avenue. · The apartments south of Fred Sims Park have had problems with stormwater drainage and lacks amenities. · Fred Sims Park needs to provide a parking and vehicle turn around area. · Stormwater ponding at the Oregon Avenue/46th Avenue intersection presents problems for traffic and street maintenance. District 17 District 17 encompasses the New Hope's City Center described as the commercial focal point of the community. District 17 Issues · Street and streetscape improvements are needed along 42nd Avenue, 45th Avenue and Xylon Avenue. These improvements are intended to improve both the function and appearance of these streets. · Xylon Avenuei42nd Avenue/Gethsemane Cemetery entrance intersection should be aligned and improved to facilitate improved traffic movement and safety at the Xylon intersection. City of New Hope Comprehensive Plan Update Planning Tactics 35 ~y~. ~ EDA Originating Depaxtment Approved for Agenda Agenda Section i~~ EDA Community Development 5-10-99 Item No. DYKirk McDonald DISCUSSION REGARDING REQUEST FOR CIAL ASSISTANCE FOR POTENTIAL REHABILITATION PROJECT AT 8113 BASS LAKE ROAD ACTION REQUESTED Staff has received the enclosed correspondence from the new owner of the fourplex property located at 8113 Bass Lake Road requesting consideration of financial assistance to rehabilitate the building and site. Staff requests to discuss this request with the EDA and get direction on how to proceed. POLICY/PAST PRACTICE In 1993, the EDA established a loan program directed at maintaining multi-family rental housing. The program is directed at those properties with the greatest need, and basic improvements such as roof/window replacement, wiring, heating and mechanical repairs carry a higher funding priority, as opposed to amenities. Financing is provided by the EDA in the form of a Iow interest loan to leverage private funds and normally a 50/50 matching of funds is required for eligible projects. One project has been completed under this policy; in 1994-95 the 48 units (4 12-unit buildings) at New Hope Apartments were renovated. BACKGROUND This request comes from the new owner of the fourplex property located at 8113 Bass Lake Road. The building was previously owned by David Espeland. The building was constructed in 1958 and has a market value of $136,000 (land $26,000/building $110,000). The building has a brick exterior, but is in need of substantial repairs, including roof and window replacement, rain gutters, exterior doors, drain tile, a boiler and general interior upgrading. The parking area needs resurfacing, additional landscaping is needed and no garages are available on the site. The owner has estimated the project cost at $15,000, however, staff estimate it will be at least twice that amount. There is a twin fourplex building located adjacent to this building (8109 Bass Lake Road) that is under separate ownership. Both properties are located on the south side of Bass Lake Road, just west of Lyndale Garden Center, and have a shared access off of Bass Lake Road. (cont'd.) MOTION BY SECOND BY - i /- / RFA-O01 Request for Action Page 2 5-10-99 These properties have been designated in the Comprehensive Plan for either redevelopment or substantial rehabilitation. Staff is pleased that the new owner wants to cooperate with the City on potential improvements to the property. Staff is requesting direction from the EDA as to whether or not it is interested in pursuing a rehabilitation project at this site in cooperation with the new owner. If the EDA determines to proceed, staff would recommend taking the following steps: 1. Staff meet with property owner to determine what improvements would be included in the project and get firm cost estimates. 2. Approach the owner of the adjacent building to see if they would participate in the project. 3. Have the City's financial consultant review the owners financial records (at the owner's expense) to determine if they have the capability to repay the loan. Once these steps were completed, staff would come back to the EDA with a complete project overview and request direction to proceed with the necessary loan documents. Attachments: Correspondence from Owner Site Maps Comp Plan Excerpts Rehab Loan Guidelines Steven A. Martinetti 8113 Bass Lake Road, Apt. 2 New Hope, MN 55128 April 24, 1999 Mr. Kirk McDonald Director of Community Development City of New Hope 4401 Xylon Avenue North New Hope, MN 55428 Dear Mr. McDonald, I am the owner of a fourplex apartment building located at 8113 Bass Lake Road in New Hope. You may already be familiar with this property (the eyesore it is). I plan on making significant improvements and want to make it among the best rental properties in New Hope. Among the improvements will be a new roof, rain gutters, windows, exterior doors, and paint inside and out. In addition, the lower apartments will likely need to be drain tiled (I am currently attempting to correct the grade, but if this is not successful in stopping the water problem, drain tile is the next step). Finally, the parking area will need to be resurfaced and the area relandscaped. While I am anxious to complete these improvements, my funds are quite limited. I am very interested in any financial assistance the City of New Hope may have available. I am having the roof and windows estimated, and will forward these as you request. I (roughly) estimate the entire project at somewhere near fifteen thousand dollars. I appreciate your help and look forward to hearing fi.om you soon. You may call me at my daytime (work) phone, (612) 348-2156, or you may leave a message at (651) 777- 7490. Thanks again, Steve Martinetti Owner / Resident Manager 2.5 910.3 901.8 X ~ ': ..... ~ !,'iii"l~Ci~", ~i~ ..... ~-"~' ..... i .... F:"'~ " ) / : '~' I ; ' - [ * ' ' ... . ! , = ~ : ,~, , ~ ~,~ ~ .~ -'-.~.. . ~ ,: ~-.-?= ~( ....... ,??, ......... ,. ....... , i ............ . :, ....... . .... .. ..... '-~ ... -~ ~.-~---~.. ,,, . ~ ~. ~. : ...... - ~-" GOLF : " COURSE ,, MIl ' , ~ ""-~' ~' ST. THERESE .... "; ~ NURSING "~ : ..- HOME ~ , ~ ~_. ..... .;.. ..... I r ~ ~ ' i -,- .." 81~ ~'~ ~ ~ ............ .... .. ~ · ~Z~ ~ ~1 ~ ; ' ~-.., , · , '. O, .............................. ; , ;__.~ ~'= .... ........... -- .... '~' '~ -. ............ .... .~-:- , ~ "" '~ '.- .,...,"'"".... ....... j' ii~ , ~I ~ ~ ~ ~ ~ "~0 ~10 ' , . - IZ : ' ~: ~ ~ ~te ;~ ......... ; .... g .... ; .... ~.: '-~.. '"~ , i ~:. iA. ~ ............... O, -- ~ ;~: :, '""-. '"'" ' ~ '~'1 4~ ....................... ............... ~ ............................ ' .... : J~ HIGH SCHOOL i , ............. ;reek) ;~ ofl~ L~ke goc~ ~ ~on West broadway street and streC.~cape (multi-jurisdictional ~n o¢6ol£Cour~e Club ~ of' medium and high site density residential area / ue / i redevelopment sites rtunities redevelopment sites ~e / Mss Lake intersection realignment ~section desi~ -- vacant Ia'rs mi-trucks -- Medium density redevelopmen'~ /acant (Pond Place developme-- Bound ~ opportunities) I ~illty issues --Industrial redevelopment site 'tin,i. (demolish existing building) expansion / cooperat'~e rearrangement with City '~' 5ime Park parkin~i and ,~ing tt~rnaround 'on ~ gle family r~elopment crec -erse¢ion ,. ~, ~ Commerdal mdcel~ment ~ ~ ~ 42nd Avenue, ~t~ and 45th --Medium densi~ redevelopment oppo~uni~ ~win Home~) __ In place indu~ial issues ,.~" Drainage issues I ~ Cornrnunity Perspectives · The industrial park is nearly fully developed. Future industrial growth will consist of in-place expansion and site redevelopment. · The appearance of outdoor storage areas within the industrial park is an issue.' · Intersection at 49th and Boone is in need of improvement to accommodate the turning radius of semi-trucks and trailers. District 6 District 6 contains a variety of housing types from single familY to very high density. For the most part, the high density housing in District 6 is very well maintained. Issues related to District 6'include: District 6 Issues c FoOUr-plexes along Bass Lake Road are in bad condition. These sites should be-~'''',, nsidered for redevelopment. · Single family homes around Begin Park are on small lots and are in poor condition. City staff has identified this area as a redevelopment area.  City of New Hope Comprehensive Plan Update Planning Tactics 30 Goal 3: Promote ~multiple family housing altematives as an attrac[Ne life cycle housing option. Policies: A. Redevelop substandard multiple family properties that display deteriorated building conditions, no site amenities, poor site design, or incompatible land use patterns ~ when it is judged not economically feasible to correct the deficiencies. B. Adhere to the highest community design and construction standards for new construction and redevelopment projects.  company medium and high density development with adequate access~-~ ...... ~.~ enities such as garages, parking, open space, landscaping, and recreational cilities to insure a safe, functional, and.desirable living environment. ~"' D. Consider mixed land uses as an alternative land use option in planning and redevelopment of obsolete commercial or industrial sites. E. Encourage neighborliness through block clubs, block parties or neighborhood associations. COMMERCIAL GOALS Goal 1: Maintain and improve New Hope's commercial areas as vital retail and service locations. Policies: A. Work with local business people to gain an understanding of the changing needs of the business environment. B. Promote a full and broad range of office, service, retailing, and entertainment uses within the commercial areas of New Hope. C. Attract new businesses to New Hope that are complementary to existing businesses and will contribute to the customer attraction and business interchange of the local commercial areas. D. Promote the redevelopment and expansion of existing businesses within the City to obtain a higher level of sales and business attraction. B. Aggressively continue housing redevelopment programs throughout the City. C. Encourage the private redevelopment of substandard, obsolete or blighted properties. Public assistance may be applicable where the redevelopment is consistent with the goals of the New Hope Comprehensive Plan and within the financial capabilities of the City. stigate opportunities for redevelopment or deteriorating multipl-~e ~ renewal of ly sites. E. Redevelop select, commercial/industrial properties which display deteriorated building conditions, obsolete site design, incompatible land use arrangements and high vacancy levels. Goal 4: A cohesive land use pattern which ensures compatibility and strong functional relationships among activities is to be implemented. Policies: A. Maintain and strengthen the character of individual neighborhoods. B. Prevent over-intensification of land use development, that is, development which is not accompanied by a sufficient level of supportive services and facilities (utilities, parking, access, etc.). C. Investigate remedies to correct or eliminate existing land use compatibility problems. D. Examine requested land use changes in relation to adjoining land uses, site accessibility, utility availability, and consistency with the City's Comprehensive Plan and policies. E. Accomplish transitions between distinctly differing types of land uses in an orderly fashion which does not create a negative (economic, social or physical) impact on adjoining developments. F. Infill development of compatible land uses shall be strongly encouraged. G. Where practical, conflicting and non-complementary uses shall be eliminated through removal and relocation. City of New Hope Apartment Loan Program EDA Resolution NO. 93-13 Purpose In September of 1993, the New Hope Economic Development Authority established a loan program directed at maintaining multi-family rental housing. The program appeals to the City's over 3,839 multiple rental units and focuses on three fundamental areas. First, it assists owners in obtaining necessary capital for property rehabilitation and upkeep. Secondly, it provides safe and descent housing opportunities at affordable prices for residents now and into the future. Lastly, by targeting public resources in areas of greatest need the program reverses property deterioration; thereby improving overall property values and enhancing public safety within the community.. Policy Guidelines 1. In view of limited public financial resources, the program provides minimal assistance to the greatest number of projects, with foremost attention to those properties in the greatest need. Basic need improvements such as: roof replacement, wiring and heating or other mechanical repairs carry a higher funding priority. 2. Loans shall remain the preferred financing vehicle as opposed to grants or equity investments. A 50/50 matching of funds is a normal requirement for eligible projects. 3. No funding is provided which, directly or indirectly, is used for fees by the owner or related parties (including construction management fees, developer fees, use of "contingency funds," fee sharing, etc.) 4. At least two bona fide bids, from non-related parties, are required for each item that is a part of an overall program of rehabilitation. 5. No funds are provided to address defaulted mortgages or to bring taxes current. 6. In cases involving substantial financial stress, appropriate participation by the lender and equity owner is required for City investment. Participation may take the following forms: debt forgiveness, additional equity investment, interest rate reduction, loan term extension, payment deferrals, management fee reduction, reduced cash flow distribution, or other good faith efforts on behalf of the leader and property owner. 7. Public funds will only be provided in those instances in which they are essential to rehabilitation of the project. Public funds will not be provided when the primary result of that provision would be to merely raise the profitability of a building. 8. Public funds will not substitute for private funding that may reasonably be raised in the private market. 9. Each financial assistance agreement will contain an accelerated repayment provision in the event of property sale, or other significant changes in circumstances. 10. Funds will not be provided to allow the owner to displace moderate income residents and attract higher income tenants. EDA rehabilitation funds may not but utilized in such a way that relocation statues and payments are triggered. 11. Funds will not be provided for projects that would result in lower property tax payments, unless such projects meet other City objectives. 12. No funding will be considered for approval without prior objective financial analysis of the project, along with an independent recommendation as to the amount and type of proposed funding. Additional Information For additional information or clarification on this program contact the following individuals: Kirk McDonald Director of Community Development City of New Hope (612) 531-5119 Susan Henry Community Development Specialist City of New Hope (612) 531-5137 G: planning/housingJaptprg