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061096 EDA Official File Copy CITY OF NEW HOPE EDA AGENDA EDA Regular Meeting #10 June 10, 1996 Agenda #11 President Edward J. Erickson Commissioner W. Peter Enck Commissioner Pat La Vine Norby Commissioner Gerald Otten Commissioner Terri Wehling 1. Call to Order 2. Roll Call 3. Approval of Minutes of May 28, 1996 4. Resolution Relating to a Redevelopment Agreement with Northridge Properties of New Hope Limited Partnership; Waiving the HRA Lien Maturity Under the Redevelopment Agreement in Connection with the Issuance of Refunding Bonds by the City and Authorizing Execution of Various Documents in Connection With Such Refunding Bonds 5. Resolution Authorizing Publication of Notice and Holding of a Public Hearing Regarding Sale of 6081 Louisiana Avenue North (Improvement Project No. 519) 6. Adjournment CITY OF NEW HOPE 4401 XYLON AVENUE NORTH HENNEPIN COUNTY, MINNESOTA 55428 Approved EDA Minutes May 28, 1996 Meeting #9 CALL TO ORDER President Erickson called the meeting of the Economic Development Authority to order' at 7:43 p.m. ROLL CALL Present: Erickson, Enck, Otten, Norby, Wehling Staff Present: Sondrall, Donahue, Leone, McDonald, Bellefuil APPROVE MINUTES Motion was made by Commissioner Otten, seconded by Commissioner Wehling, to approve the EDA minutes of May 13, 1996. Voting in favor: Enck, Otten, Norby, Wehling; Abstained: Erickson. Motion carried. RENTAL HOUSING President Erickson introduced for discussion Item 4, Motion Approving Item 4 Tasks Unlimited as the Owner and Service Provider for the Special Needs Rental Housing to be Located in New Hope (Improvement Project No. 566). Ms. Sarah Bellefuil, Community Development Specialist, stated at the direction of the EDA she has arranged a presentation which includes two speakers. Ms. Bellefuil stated New Hope has received $90,000 in HOME funds designated for special needs housing. Specifically, a large house, duplex, or small apartment would be purchased and rehabilitated for Iow-income developmentally disabled or mentally ill persons. In addition, the City has committed a $90,000 zero interest loan that would come from Economic Development Authority (EDA) funds. The loan would be considered a first mortgage on the facility and would have to be paid back to the City. The City's role in the project would be to provide financing and staff services (including recommendations on site selection and rehabilitation) to the organization that would purchase and manage the site. Ms. Bellefuil introduced Laura Klein, a Development Consultant with Project -for Pride in Living (PPL), and a representative for the CHDO. Ms. Klein discussed her relationship with the CHDO, the HOME funds that are available to support the project, the selection process used to find a service provider, and PPL's analysis of Tasks Unlimited proposal. Next recognized was John Trepp, representative from Tasks Unlimited. A short video describing Task Unlimited's program was viewed by the City Council. Mr. Trepp's presentation included the types of services provided by Tasks Unlimited, their organizational philosophy, years of experience, housing arrangements for clients, the Tasks Unlimited work program for clients, and their reception and involvement in other suburban areas. In response to questions from the EDA, Mr. Trepp provided the following New Hope EDA May 28, 1996 Page I information. The program offers housing to persons suffering from mental illness, 75-80% of the clients are males, and most facilities host four to six individuals who reside in the home on a long-term basis. The program includes an Admissions Team which evaluates clients' qualifications prior to acceptance to one of their lodges. Mr. Trepp stated in Tasks Unlimited's 26 year history he is not aware of any community problems encoUntered in communities with the lodges. Ms. Bellefuil reported staff's recommendation that Tasks Unlimited be the owner and service provider for the special needs rental housing to be located in New Hope. If the EDA approves Tasks Unlimited as the owner and service provider, staff will begin working with Tasks Unlimited to find a suitable transitional housing site in New Hope. in addition, the City and Tasks Unlimited will enter into a Letter of Understanding with regards to the project. Mr. Donahue stated a number of New Hope sites have already been reviewed, but a specific property has not yet been determined. MOTION Motion by Commissioner Norby, seconded by Commissioner Enck, approving Task Unlimited as the owner and service provider for the Special Needs Rental Housing to be located in New Hope (Improvement Project No. 586). Voting in favor: All, Motion carried. IMP. PROJECT 519 President Erickson introduced for discussion Item 5, Resolution Approving Item 6 Change Order No. 3 for Construction Contract for 6073/81 Louisiana Avenue North (Improvement Project No. 519). EDA RESOLUTION Commissioner Enck introduced the following resolution and moved its 96-10 adoption: "RESOLUTION APPROVING CHANGE ORDER NO. 3 FOR Item 5 CONSTRUCTION CONTRACT FOR 6073/81 LOUISIANA AVENUE NORTH (IMPROVEMENT PROJECT NO. 519)." The motion for adoption of the foregoing resolution was seconded by Commissioner Wehling, and upon vote being taken thereon the following voted in favor thereof: Erickson, Otten, Enck, Wehling, Norby; 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 Norby, seconded by Commissioner Wehling, to adjourn the meeting. All present voted in favor. The New Hope EDA adjourned at 8:17 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA May 28, 1996 Page 2 REQUEST FOR ACTION Originating Department Approved for Agenda Agenda Section Finance/Administration ~--~ne 10, 1996 EDA ' 1~, / ItemN°' By: Larry Watts By: [/ 4 RESOLUTION RELATING TO A REDEVEL/PMENT AGREEMENT WITH NORTHRIDGE PROPERTIES OF NEW HOPE LIMITED PARTNERSHIP;/WAIVING THE HRA LIEN MATURITY UNDER THE REDEVELOPMENT AGREEMENT IN CONNECTION WITH THE ISSUANCE OF REFUNDING BONDS BY THE CITY A/qD AUTHORIZING EXECUTION OF VARIOUS DOCUMENTS IN CONNECTION WITH SUCH REFUNDING BONDS This resolution allows Northridge to refinance their existing loan and maintain a status quo on the lien. ~o~o~ '/~/~/Y~__~co~ ~ · o: ~L~- ?~/~ ~ ~/i Review: Administration: Finance: RFA-O01 ~ CERTI'FICATE NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY I, the undersigned being the duly qualified Executive Director of the New Hope Economic Development Authority (the EDA), hereby attest and certify that: 1. As such officer, I am the recording officer of the EDA and have the legal custody of the original record from which the attached resolution was transcribed. 2. I have carefully compared the attached resolution with the original record of the meeting at which the resolution was acted upon. 3. I find the attached resolution to be a true, correct and complete copy of the original: EDA RESOLUTION NO. 96-__ Resolution Relating to a Redevelopment Agreement with Northridge Properties of New Hope Limited Partnership; Waiving the HRA Lien Maturity Under the Redevelopment Agreement in Connection With the Issuance of Refunding Bonds by the City and Authorizin9 Execution of Various Documents in Connection With Such Refunding Bonds 4. I further certify that the affirmative vote on said resolution was __ ayes, hayes, and absent/abstention. 5. Said meeting was duly held, pursuant to call and notice thereof, as required by law, and a quorum was present. WITNESS my hand officially as such Executive Director this day of , 1996. Daniel J.. Donahue, Executive Director EDA RESOLUTION NO. 96- RESOLUTION RELATING TO A REDEVELOPMENT AGREEMENT WITH NORTHRIDGE PROPERTIES OF NEW HOPE LIMITED PARTNERSHIP;WAIVING THE HRA LIEN MATURITY UNDER THE REDEVELOPMENT AGREEMENT IN CONNECTION WITH THE ISSUANCE OF REFUNDING BONDS BY THE CITY AND AUTHORIZING EXECUTION OF VARIOUS DOCUMENTS IN CONNECTION WITH SUCH REFUNDING BONDS BE IT RESOLVED, by the Board of Commissioners of the New Hope Economic Development Authority (the "EDA"), as follows: 1. Recitals. The Housing and Redevelopment Authority in and for the City of New Hope, Minnesota (the "HRA") has approved a redevelopment plan, as defined in Minnesota Statutes, Section 469.002, subdivision 16, together with amendments thereto, designated as Redevelopment Plan 82-1 ("Redevelopment Plan 82-1"), and a redevelopment project to be undertaken pursuant thereto, as defined in Minnesota Statutes, Section 469.002, subdivision 14, together with amendments thereto, designated as Redevelopment Project 82-1 ("Redevelopment Project 82-1"). In connection with Redevelopment Plan 82-1 and Redevelopment Project 82-1, the HRA and the City of New Hope (the "City") entered into a 1984 Redevelopment Agreement dated January 30, 1985 (the "Redevelopment Agreement"), with Northridge Properties of New Hope Limited Partnership, a Minnesota limited partnership (the "Developer"), and Charles P. Thompson and Mary Jane Thompson whereby the HRA sold certain premises described therein (the "Land") to the Developer. The Developer has constructed a 73-unit apartment building on the Land (the "Project"). To secure performance of the Developer's obligations under the Redevelopment Agreement, the HRA has imposed certain covenants, restrictions and limitations on the Land, all as more fully set forth in the Redevelopment Agreement. Pursuant to Minnesota Statutes, Section 469.094, subdivision 2, the City transferred control of Redevelopment Plan 82-1 and Redevelopment Project 82-1 from the HRA to the EDA. The Developer has proposed that the City issue its Multifamily Housing Development Refunding Revenue Bonds (Chardon Courts Project), Series 1996 (the "Refunding Bonds"), in a principal amount not in excess of $5,100,000 under an Indenture of Trust between the City and Norwest Bank Minnesota, National Association, as trustee (the "Trustee"). The proceeds of the Refunding Bonds will be loaned to the Developer and applied to prepay the Developer Loan, as defined in the Redevelopment Agreement. The Bonds will be secured by a Combination Mortgage, Security Agreement and Fixture Financing Statement (the "Mortgage") from the Developer to the City and an Assignment of Rents and Leases (the "Assignment") from the Developer to the City. The City will assign its interest in the Mortgage and Assignment to the Trustee. The Deve]oper has requested that the EDA (i) agree that the refinancing of the Deve]oper Loan by the issuance of the-Refunding Bonds does not constitute an HRA Lien Maturity, as defined in the Redevelopment Agreement, and (ii) acknowledge that the rights of the EDA under the Redevelopment Agreement are subordinate to the rights of the Trustee under the Mortgage and Assignment. 2. Waiver of HRA Lien Maturity and Approval of Subordination Agreement, The EDA agrees that the payment of the Developer Loan upon the issuance of the Refunding Bonds shall not constitute a HRA Lien Maturity, as defined in the Redevelopment Agreement. Such waiver shal] only apply to the refinancing of the Developer Loan by the issuance of the Refunding Bonds, and shall not app]y to any subsequent or other event constituting an HRA Lien Maturity under the Redevelopment Agreement, or impair any right of the EDA consequent thereto. The EDA acknowledges that its rights under the Redevelopment Agreement are Subordinate to the rights of the Trustee under the Mortgage and Assignment. If requested by the Developer, the appropriate officers of the EDA are authorized and directed to execute such agreements as may be necessary and appropriate in the opinion of the officer or officers executing any such agreement and in the opinion of the attorney for the EDA, to evidence such subordination and to evidence the waiver of the HRA Lien Maturity as provided herein. Passed the lOth day of June, 1996. Edw. J. Erickson, President Attest: Daniel J. Donahue, Executive Director c:\wp51\cnh\chardon,eda SUBORDINATION AGREEMENT This Agreement is made effective as of the 1-st day of 1996, by and between the NEW HOPE ECONOMIC DEVELOPMENT AJTHORITY (the "EDA") to and for the benefit of NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION, as Trustee (the "Trustee") under an Indenture of Trust, dated as of 1, 1996 (the "Indenture"), between the City of New Hope, Minnesota (the "City"), and the Trustee. Recitals The Housing and Redevelopment Authority in and for the City of New Hope, Minnesota (the "HRA"), has entered into a 1984 Redevelopment Agreement, dated January 30, 1985 (the "Redevelopment Agreement"), with Northridge Properties of New Hope Limited Partnership, a Minnesota limited partnership (the "Company"), and Charles P. Thompson and Mary Jane Thompson. The Redevelopment Agreement provides for the construction by the Company of an apartment rental housing project (the "Building") on property described in Exhibit A attached hereto and made a part hereof (the "Land"). The HRA has assigned all of its interests in and to the Redevelopment Plan 82-1 within which the Land is located to the EDA, and such assignment by the HRA to the EDA included all of the rights of the HRA under the Redevelopment Agreement. There is to be issued under the Indenture, the Multifamily Housing Refunding Revenue Bonds (Chardon Court Project), Series 1996 of the City (the "Bonds"), in the principal amount of $ , the proceeds of which are to be loaned to the COmpany pursuant to a Loan Agreement, dated as of 1, 1996 (the "Loan Agreement"), between the City and the Company and used by the Company to prepay the Developer Loan, as defined in the Redevelopment Agreement, which financed the acquisition, construction and equipping of the Building. The payment of the principal of, premium, if any, and interest on the Bonds and obligations of the Company arising under the Loan Agreement are secured by a Combination Mortgage, Security Agreement and Fixture Financing Statement, dated as of 1, 1996 (the "Mortgage") from the Company to the City which was recorded in the office of the Registrar of Titles in and for Hennepin County, Minnesota as Document No. and an Assignment of Rents and Leases, dated as of 1, 1996 (the "Assignment") from the Company to the City which was recorded in the Registrar of Titles in and for Hennepin County, Minnesota as Document No. The City has assigned all of its interest in the Mortgage to the Trustee pursuant to an Assignment of Mortgage Agreement between the City and the Trustee, which was recorded in the office of the Registrar of Titles in and for Hennepin County, Minnesota as Document No. , and the City has assigned all of its interest in the Assignment to the Trustee pursuant to an Assignment of Rents and Leases between the City and the Trustee which was recorded in the office of the Registrar of Titles in and for Hennepin County, Minnesota as Document No. The original purchaser of the Bonds has required as a condition to its purchase of the Bonds that the EDA execute a Subordination Agreement whereby the EDA fully subordinates all rights and interests of the EDA in or to the Land, the Building and all rights appurtenant thereto (collectively referred to as the "Premises") of any kind whatsoever under the Redevelopment Agreement, to the lien of the Mortgage, the Assignment and any other lien or security, at any time hereafter acquiCed by the Trustee in all or any portion of the Premises to secure the payment of principal of, premium, if any, and interest on the Bonds (collectively the "Bond Security Documents"). Accordingly, the EDA and the Trustee hereby agree as follows: 1. The EDA acknowledges and agrees that all rights and interests of the EDA in or to the Premises under the Redevelopment Agreement are hereby made and shall be fully subordinate and subject to the respective liens of the Bond Security Documents, all with the same force and effect as if the Bond Security Documents were executed, delivered and recorded, and all financial accommodations secured thereby were fully funded, prior to imposition of the restricting covenants and limitations imposed upon the Premises pursuant to the Redevelopment Agreement. 2. The EDA acknowledges receipt of copies of the Mortgage, the Assignment, the Indenture and Loan Agreement. 3. If, following any Event of Default under any of the Bond Security Documents, the Trustee accepts a deed to the Premises from the Company, the EDA agrees that upon the recording of such deed all rights and interest of the EDA in and to the Premises, whether under the Redevelopment Agreement or otherwise, including but not limited to the restrictive covenants therein contained, shall be automatically null and void without need for the execution or recording of any other document. 4. The EDA represents to the Trustee that the making, delivery and performance of this Agreement have been duly authorized by all necessary action on the part of the EDA and this Agreement, when executed, shall be the valid and binding obligation of the EDA, enforceable in accordance with its terms. 5. The EDA and the Trustee acknowledge that the Trustee is not a party to the Redevelopment Agreement and that this Agreement contains the entire agreement between the EDA and the Trustee with respect to any rights or obligations either might otherwise have with respect to each other under the Redevelopment Agreement, and-that this Agreement may be amended only in writing signed by both parties hereto. By executing and delivering this Agreement, the Trustee shall not incur any obligations to the EDA of any kind whatsoever, except those expressly set forth herein, and the Trustee may administer its obligations under the Indenture with respect to the Bonds in such manner as it shall deem appropriate. 6. The EDA agrees that the Trustee may, at any time, and from time to time, extend the maturity, modify the interest rate or agree to alter any of the terms of payment of any indebtedness secured by the Bond Security Documents, or release parties liable for payment thereof, or alter or amend or waive any of the terms and provisions of the Bond Security Documents in any way, all without any notice to or consent of the EDA. 7. This Agreement does not in any manner affect the rights and interests of the EDA or City in and to the Premises under the Assessment Agreement dated as of January 30,1985, recorded in the office of the Registrar of Titles in and for Hennepin County, Minnesota, as Document No. . 8. This Agreement shall be binding upon and inure to the benefit of the EDA and the Trustee and their respective successors and assigns. Executed as of the day and year first above written. NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY By Its And Its STATE OF MTNNESOTA ) COUNTY OF HENNEPIN ) The foregoing istrument was acknowledged before me this day of , 1996, by and , respectively, of the New Hope Economic Development Authority, a public body corporate and public, on behalf of such agency. Notary Public c:\wp51~c~t~\ char d0n. sub EDA REQUEST FOR ACTION originating Department ! Approved for Agenda Agenda Section City Manager [ ~10-96 ED^ Sarah Bellefuil, Community )/ Item No. By: Development Specialist By: 5 RESOLUTION AUTHORIZING PUBLICATION OF NOTICE AND HOLDING OF A PUBLIC HEARING REGARDING SALE OF 6081 LOUISIANA AVENUE NORTH (IMPROVEMENT PROJECT #519) City staff has found a buyer, Daniel J. Langenberger, for the northern unit of the handicap accessible twin home built at 6073/6081 Louisiana Avenue North. A Purchase Agreement has been executed, subject to the approval of the EDA. By law, a public hearing regarding the sale must be held with at least 10 days published notice. The attached resolution authorizes the public hearing and publication of the notice. The public hearing would then be conducted at the June 24th City Council/EDA Meeting. Staff recommends approval of the resolution authorizing publication of notice and holding of a public hearing regarding the sale of 6081 Louisiana Avenue North (Improvement Project #519). MOTION BY SECOND BY TO: Review: Administration: Finance: RFA-O01 EDA RESOLUTION NO. 96- RESOLUTION ORDERING PUBLISHED NOTICE AND PUBLIC HEARING ON SALE OF 6081 LOUISIANA AVENUE NORTH WHEREAS, the Economic Development Authority in and for the City of New Hope (EDA) owns certain real estate known as 6081 Louisiana Avenue North, legally described as: Lot 1, Block 1, Cameron 3rd Addition, Hennepin County, Minnesota, (the Property), and WHEREAS, the Property has been improved by the construction of one unit of a two unit handicap accessible twinhome, and WHEREAS, Daniel J. Langenberger has offered to purchase the Property from the EDA, and WHEREAS, Minn. Stat. 469.105 requires a public hearing to determine the advisability of the sale of EDA real property, preceded by published notice. 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 staff are directed to ensure the NOTICE OF PUBLIC HEARING PER MINN. STAT. §469.105 AUTHORIZING SALE OF PROPERTY AT 6081 LOUISIANA AVENUE NORTH attached hereto as Exhibit A is published in the official newspaper of the City on June 12, 1996. 3. That a public hearing on the advisability of the sale of Lot 1, Block 1, Cameron 3rd Addition to Daniel J. Langenberger shall be held in accordance with the Notice of Public Hearing attached hereto as Exhibit A. Adopted by the Economic Development Authority in and for the City of New Hope this lOth day of June, 1996. Edw. J. Erickson, President At t est: Daniel J. Donahue, Executive Director NOTICE OF PUBLIC HEARING PER MINN. STAT. §469.105 AUTHORIZING SALE OF PROPERTY AT 6081 LOUISIANA AVENUE NORTH ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF NEW HOPE Notice is hereby given that the Economic Development Authority in and for the City of New Hope, Minnesota, wi]l meet on the 24th day of June, 1996, at 7:00 o'clock p.m. at the City Hall, 4401 Xylon Avenue North, in said City for the purpose of holding a public hearing to consider sale of the following described property to Daniel J. Langenberger: Lot 1, Block 1, Cameron 3rd Addition, Hennepin County, Minnesota 6073 Louisiana North, New Hope PID No. 05 118 21 21 0114 The public may see the terms and conditions of the sale at the City Hall. At said public hearing, the Economic Development Authority will decide if the sale is advisable. A]I persons interested are invited to appear at said hearing for the purpose of being heard with respect to the sale of the described property. Auxiliary aids for persons with disabilities are available upon request at ]east 96 hours in advance. Please contact the City Clerk to make arrangements (telephone 531-5117, TDD number 531-5109). Dated the lOth day of June, 1996. s/ Valerie d. Leone Valerie d. Leone City Clerk (Published in the New Hope-Golden Valley Sun-Post on the 12th day of June, 1996.) EXHIBIT A CORRICK ~[ SONDRALL, P.A. STEVENA. SONDRALL ATTORNEYS AT LAW MICHAEL R. LAFLEUR MART~N P. MA~ECHA Edinburgh Executive Office Plaza WILLIAM C. STRAIT 8525 Edinbrook Cross~g Suite ~203 Brookl~ P~k, M~neso~ 55443 TELEPHONE (612) 4~5~1 F~ (S12) May 31, 1996 CDaniel J. Oonahue New Hope EDA 4401 Xylon Avenue North New Hope, MN 55428 RE:Sale of 6081 Louisiana North Our File No. 99.11154 Dear Dan: The EDA has signed a Purchase Agreement with Daniel Langenberger for the sale of the second unit of the two unit twinhome at 6081 Louisiana Avenue North, contingent upon approval of the Purchase Agreementby the governing body of the EDA. As with real any property, the EDA must consider the advisability of the sale after a public hearing, and the hearing must be preceded by 10 days published notice. The enclosed Resolution orders the publication and the public hearing. This Resolution should be on the agenda for the June lOth yEDA meeting, and will allow notice in time for a hearing on June 24th. Our office will take care of getting the Notice to the New Hope-Golden Valley Sun-Post in time for publication on June 12th. Please call if you have any questions. Sincerely, ~. ~IGNED ,~ECHA Martin P. Malecha m3f cc: Valerie Leone, City Clerk Kirk McDonald, Management Assistant (w/enc) Sarah Bellefuil, Administrative Assistant (w/enc) Steven A. Sondrall, City Attorney