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092595 EDA Official File Copy CITY OF NEW HOPE EDA AGENDA E1)A Regular Meeting//15 September 25, 1995 Agenda//16 President Edward J. Erickson Commissioner W. Peter Enck Commissioner Pat LaVine Norby Commissioner Gerald Otten Commissioner Terri Wehling 1. Call to Order 2. Roll Call 3. Approval of Minutes of September 11, 1995 4. Consideration of Huebner Purchase Agreement Offering to Sell Property at 7609 Bass Lake Road for $78,500 5. Discussion Regarding Guidelines for Financial Assistance to Businesses 6. Discussion Regarding Development Agreement with Gill Brothers Funeral Chapels, Inc. (Improvement Project No. 523) 7. Motion Approving a Request for Proposals for Special Needs Rental Housing 8. Adjournment CITY OF NEW HOPE 4401 XYLON AVENUE NORTH HENNEPIN COUNTY, MINNESOTA 55428 Approved EDA Minutes September 11, 1995 Meeting//14 CALL TO ORDER President Pro tem Enck called the meeting of the Economic Development Authority to order at 8:11 p.m. ROLL CALL Present: Enck, Otten, LaVine Norby, Wehling Absent: Erickson Staff Present: Sondrall, Hanson, Donahue, Leone, McDonald, Bellefuil APPROVE MINUTES Motion was made by Commissioner Otten, seconded by Commissioner Wehling, to approve the EDA minutes of August 28, 1995. All present voted in favor. Motion IMP. PROJECT 519 President Pro tern Enek introduced for discussion Item 4, Resolution Authorizing Item 4 Letter of Agreement for Design Services for 6073 Louisiana (Improvement Project No. 519. It was noted that this will be a similar structure to the project recently constructed at 51st and Winnetka. The EDA acknowledged the attractiveness of the completed construction project. Mr. Donahue indicated the design services will be obtained through Equal Access Homes, and the twin home design will be brought back to the EDA for approval prior to the construction bidding process. EDA RESOLUTION Commissioner Wehling introduced the following resolution and moved its adoption: 95-18 "RESOLUTION AUTHORIZING LETTER OF AGREEMENT FOR DESIGN Item 4 SERVICES FOR 6073 LOUISIANA (IMPROVEMENT PROJECT NO. 519)". The motion for the adoption of the foregoing resolution was seconded by Commissioner Otten and upon vote taken thereon the following voted in favor: Enck, Otten, Norby, Wehling; and the following voted against the same: None; Absent: Erickson; 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 Otten, seconded by Commissioner Wehling, to adjourn the meeting. All present voted in favor. The New Hope EDA adjourned at 8:13 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA September 11, 1995 Page 1 CITY OF NEW HOPE 4401 XYLON AVENUE NORTH ItENNEPIN COUNTY, MINNESOTA 55428 Approved EDA Minutes September 11, 1995 Meeting//14 CALL TO ORDER President Pro tem Enck called the meeting of the Economic Development Authority to order at 8:11 p.m. ROLL CALL Present: Enck, Otten, LaVine Norby, Wehling Absent: Erickson Staff Present: Sondrall, Hanson, Donahue, Leone, McDonald, Bellefuil APPROVE MINUTES Motion was mad0 by Commissioner Otten, seconded by Commissioner Wehling, to approve the EDA minute8 of August 28, 1995. All present voted in favor. Motion IMP. PROJECT 519 President Pro tern Enck introduced for discussion Item 4, Resolution Authorizing Item 4 Letter of Agreement for Design Services for 6073 Louisiana (Improvement Project No. 519. It was noted that this will be a similar structure to the project recently constructed at 51st and Winnetka. The EDA acknowledged the attractiveness of the completed construction project. Mr. Donahue indicated the design services will be obtained through Equal Access Homes, and the twin home design will be brought back to the EDA for approval prior to the construction bidding process. F_,DA RESOLUTION Commissioner Wehling introduced the following resolution and moved its adoption: 95-18 "RESOLUTION AUTHORIZING LETTER OF AGREEMENT FOR DESIGN Item 4 SERVICES FOR 6073 LOUISIANA (IMPROVEMENT PROJECT NO. 519)". The motion for the adoption of the foregoing resolution was seconded by Commissioner Otten and upon vote taken thereon the following voted in favor: Enck, Otten, Norby, Wehling; and the following voted against the same: None; Absent: Erickson; whereupon the resolution was declared duly passed and adooted, signed by the President which was attested to by the Executive Director. OTHER BUSINESS Commissioner Wehling questioned the property for sale on 49th Avenue and whether the City should purchase and build a similar project there. Mr. Donshue explained tlmt the site has soil problems. ADJOURNMENT Motion was made by Commissioner Otten, seconded by Commissioner Wehling, to adjourn the meeting. All present voted in favor. The New Hope EDA adjourned at 8:13 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA September 11, 1995 Page 1 EDA I REQUF_~T FOR ACTION originating Department Approved for Agenda Agenda Section City Manager EDA 9-25 -95 Kirk McDonald ff~ Item No. By: Management Assistant By:// 4 CONSIDERATION OF HUEBNER PURCHASE AGREEMENT OFFERING TO SELL PROPERTY AT 7609 BASS LAKE ROAD FOR $78,500 The City has received the enclosed Purchase Agreement from Ronald and Sharie Huebner offering to sell their property at 7609 Bass Lake Road to the Economic Development Authority for $78,500. City staff are not in favor of acquiring the property for this price and are recommending that the EDA not enter into the Purchase Agreement. Staff believe that the offer is in excess of the property's fair market value based on the recent appraisal completed which valued the property at $65,000. Also, given the fact that the proposed housing project for this area has been canceled by the EDA, acquisition of the property by the City is no longer vital to the promotion of a public purpose. Staff have advised the Huebners that the staff will not be recommending approval of the Purchase Agreement and the City Attorney has recommended that they attend the meeting to answer any questions that the EDA may have in connection with their offer. Staff recommends approval of a motion rejecting the purchase offer submitted by Ronald and Sharie Huebner for the property at 7609 Bass Lake Road and directing staff to inform said parties accordingly. MOTION BY ~rr~(~,4~' SECOND BY Review: Administration: Finance: RFA-O01 ~ Co~a~ic~ & So~i)~a.L, P.A. s~EWN ~, SON[3.A~ ATTORNEYS AT LAW ~CHAEL .. ~L~UR Edinburgh Execu~ve Office Plaza MARTIN P. MALECHA WILLIAM C. STRAIT ~ Bd1~b~ooA C~osstng Sutte BTookl~ Park, Mta~eso~ 55443 TE~ONE (612) 42~5671 FAX (612) 42~5a67 September 18, 1995 Kirk McDonald Management Asst. City of New Hope 4401Xylon Avenue North New Hope, MN 55428 RE: Huebner Purchase Agreement Our File No: 99.29431 Dear Kirk: The Request for Action on the Huebner Purchase Agreement shout~ simply be entitled "Consideration of Huebner Purchase Agreement Offering to Sell Property at 7609 Bass Lake Road for $78,500". It is my understanding we are recommending to the EDA that this offer be rejected. Basically, the offer is in excess of fair market value as established by an appraisal we recently obtained. A~so, the property is no longer necessary to facilitate the canceled housing project in that area. Please indicate in your Request for Action that our recommended action by the EDA at its September 25, 1995 meeting would be a motion rejecting the purchase offer submitted by Rona]d and Sharie Huebner with direction to Staff to inform said parties accordingly. Please contact me if you have any comments or need any additional information from me relating to this agenda item. Very truly yours, Steven A. Sondra~l slm cc: Danie~ J. Donahue, City Manager CORRICK & SONDRALL. P.A. STEVEN A. SONDRALL ATTORNEYS AT LAW UART..U~C'A~L.."'M*~C.*~U" Edinburgh Execu~ve Office Plea w~u~ c. sm.*,T 8525 Edinbrook Crossing Suite ~203 Brookl~ P~k. Minnesota 55443 TE~ONE (612) 4~1 F~ (612) 4~S~ September 18, 1995 Ronald and Sharie Huebner 7609 Bass Lake Road New Hope, MN 55428 RE: Acquisition of Property at 7609 Bass Lake Road Our File No: 99.29431 Dear Mr. and Mrs. Huebner: [ want to acknowledge receipt of your proposed Purchase Agreement offering to sell your property at 7609 Bass Lake Road to the New Hope Economic Development Authority for $78,500.00. This offer will be considered by the New Hope EDA at its meeting on September 25, 1995. ! recommend that you attend this meeting to answer any questions the Economic Development Authority may have in connection with your offer. However, please be advised that the New Hope Staff is not in favor of acquiring your property for $78,500 and will be advising the Economic Development Authority not to enter into the Purchase Agreement. Basically, Staff believes the offer is in excess of the property's fair market value based on the recent appraisal we received. Also, given the fact that the proposed housing project for your area has been canceled by the EOA, acquisition of your property by the City is no longer vital to the ~romotion of a public purpose. However, if you list your property for sale on the private market I suggest that you ask your realtor to exclude from the listing agreement any future sale of your property to either the City of New Hope or the New Hope Economic Development Authority. This will save your significant real estate commissions in the event the City's position regarding the acquisition of your property changes in the future. Ronald and Sharie Huebner September 18, 1995 Page 2 you have any questions, please do not hesitate to contact me. r~v~,t.ru t Steven A. Sondra]"l New Hope City Attorney slm2 cc: Danie] J. Donahue, City Manager Kirk McDonald, Management Ass~~ CORRICK & SONDRALL, P.A. STEVEN A. SONDRALL ATTORNEYS AT LAW ~'~'~ M~C.^~L.. L~U. Edinburgh Execu~ve Office Plaza ~"~" ~. ~"'~ MARTIN P. MA~CHA WILUA" C. ST~T 8525 Edinbrook Crossi~ Suite ~203 Brookl~ P~k. M~nesom 55443 August 30, 1995 Mr. and Mrs. Rona]d Huebner 7609 Bass Lake Road New Hope, MN 55428 RE: Acquisition of Property at 7609 Bass Lake Road Our File No: 99.29431 Dear Mr. and Mrs. Huebner: Kirk McDonald, the New Hope Community Development Coordinator, requested me to contact you regarding the Bass Lake Housing Redevelopment Project. The New Hope Economic Development Authority terminated the project at its August 28, 1995 Council meeting pursuant to the enclosed Resolution. However, the City may still be interested in purchasing your property. It is my understanding that you have spoken with Mr. McDonald regarding acceptable terms for acquisition by the City. At this time I would request that you prepare and forward to me a purchase agreement for the sale of your property to the City. Upon receipt of same, I will bring it to the City Council for consideration at its next regularly scheduled meeting. If you have any questions, please do not hesitate to contact me. 5¥ STEVEN A. SONDRALL steven A. Sondra]] New Hope City Attorney slw Enclosure cc: Kirk McDonald, Community Development Coordi Daniel J. Donahue, City Manager SEP 11 '9~ 15:06 ER DAHLSER~ ~NC 612 5~0 ~5~9 TO ~5~151~6 P.01×07 Facsimile Cover Sheet Company: · Phone: C~ny: Pag. including ~ Commen~: RECEIVED OF ~e sum or _. Oy as earnest monw to ~ d~it~ ~e next bu~ne~ d~y after a~p~e in ~ust a~ount of liafl~ brok~ (unless othe~ T~a~ C & O, Registered Land ~V~Y N~. 848, I~t~ at (Str~ A~r~s) 7609 Bass Lake Road, New Hope, MN 55428-3828 ~1w o~ ..... ~e~ Hope ..... ~un~ ~ . M~n, , state of Minn--; ~mlu=$ng .all plan~,_~nm~e t~av~m~=ra~ mst amEh~ ;~nafl~ wmma mm ~lm, ~lu~ing ~ur~, wa~r ~ffr: n~ang ~m, h~m~ef, oe~tral air ~ndEionin{ ~e~ mr ~.pr, a~maac gara~ odor oR.er ~ Fo~, ~r ~ner, Dana t~smn ~e~s. ~a ~ng, BUILT-IN8 ~ includt ~t~ om t~e premises wb~h are the p~ of 8ell~ and alan ~e ~llo~ng ~nml pr~: none all of which property D, eller ha. tibia day .old to I~Jyer for the sum of: $ 7 I~: 500 _ Sevenl;y etch~ l:;houaend £iVe hundz'ed and no/1OO. ---- Do,an which Buyer agrees to pay in the following manner:. Earnest money of $ and of $ by financing aa AW ~ 0 aclde~clums whic~ am ~de a ~ ~ ~ tO be J~ In W~M. H any, ~~mamet~le ~ ~ me pmm~ ~ 9nN ~ ~ ~ (1) eu~dl~ and z~f~ laws. 0~, .~ F~l.mguM~ons..(2) Remnca~ ~ ~ uN or ~~t o~ ~ pmmi=~ R~L EBTA~ T~EB ~ger ag~s ~ ~y 6 / l~hl a~ ~r ~ ~ ~ 6 I 1~ M ~M d~ a~ ~le in ~e yes B~r shaft pay ~e= ~ and ~le ~ ~e yelr 19 ~ ~ *~ un.id i~1~ ~ spW u~s~ p~able ~1 and ~e~e~M. Seller ~ ~et Wes ~ a~ ~yWe ~ t~ ~ 19.~ wl~ ~ . . ...... non- homemm uuyer n~ n~t to m~ R~ml~ pfl~ to ~w~.. ~[ e~ll ~ ~)~ al ~.~ ~ au ~, nffuan~ nrta am ~dW~n, wing and p~ming ire iff M ~. OM ~0~ ~. ~M ~ffam m ~ p~ a~ ~flw m: ~i~ All intefem, c~ water ~ ~r ~a~e~. sW~ ~ nmm~ ~ ~a~...~.m} a~l~ ~m ~. mai[ ~e p~r~. ~en t~, r~ul~ shall ~ ~n~, ~t u~n ~ of title ~ w~m 10 .~ .a~r w~ .~. ~e ~[,t~ pa~l~ ~n~ll..Re~o~ ~ls DEFAULT If ~1. i8 mm~M ~ II ~rW w~ ~ h~. ~ener may [em,nme 8ew~ u~ ~e Buyer pumuent ~ M~A ~.21. ~ te~ma~ ~ ~1 be thl~ (~) M~ a8 ~d ~ ~=~n 4 Gl M~ AGENCY D~LO~URE '" j i ~1~ ~ ~ -- M ~~ ~. . I, the o~e~of the or~t~/u~thi.~eement and the g~ h~de. /Z // /// ~/ 7 //- ~~ ~ fo~ ~. SELLER ~ BUYER SE~R ~ g . ~ ~e x BUYER No delinquent t~xee and tran~fe~ e~tered; Ce~i~c~ o~ ~ea] Estate Value ( )fi]~ ( )not r~ utred , 19 , . County Aud/tor Deputy ~re$orved for rec0rdln~ da~a~ MORTGAGE P. EGISTRY TAX DUE HEFtEON: (reserved for mortgage reflistry tax payment date) - , · Date; ArbaleSt: 18 .... TH/5 COIq'I'ItAi~T FOR DEED is made on the above date by (mn~taI a~t~) ' ~iler (whether one or Inet), and Seller and ~urcha~rs a~ee ~ the follo~n~ ~rmm 1. PROPER~ DESCRIPTION. ~ller he.by sells, end Pu~h~merm h~eby buy, ~mi pro~y In H~ep~ .. County, Mlnn~oM, des~ as follows: The selle~ ~e~r~L£teH ~ka~: the ~elle~ doe~ ~ ~ oi/ au~ w011 on tho deuce/bed mi l~. : together with all heruditaments and apptLttenanoes belonging the~nto (the ProPm*~): 2. 'IqITI~. Seller warrants that title to.the Propert~ is, off the date of this eontra0t, subject only to the rollowinf exceptions: (al Covenants, conditions, restrictions, declarations and easements of record, if any; (b) Reservations of minerals or mineral right~ by the/grate of Minnesota, if any; (c) Building, zoninj~ and subdivision iaw~ and regulations;' (d) The lien o£ real estate taxes and instailmenbs of special ass~emente which are payable by. Purchasers pursuant to pa~'agraph 6 of thLs contract; and (el The followin8 liens or encumbrances: 3. DEEA~rER¥ OF DEED A-WD EVIDEIqCE OF Trl~E. U~n of ~ie ~n~nct, ~il~r ohnih (al Execute, acknowl~e and deliver ~ Pureh~ a ..... W~~ De~. in r~able fo~, ~nveying marketable ~tiu ~ the Prop~ to ~u~hm, uubj~t only ~ ~e followin~ 6) ~o~ exceptions ~fer~d to in parnaraph ~a), (b), (el and (d) of ~b ~ntruct; fid ~ens, eneumbran~, adverse claims or other matra whioh Pur~as~ have ~ea~, suffe~d or permitt~ ~ accrue sftsr the dmte of thio contract; and ~ 8. HE~~. ~n~ of the Rara~ra~h~ of ~h~ con~ra~t are for providing for a~men~ to be levied against the Pr~per$~ by any owner~' a~sociatian, which a~2e~ment~ may b~ome a lien against tb~ Property if nat paid. then: (n) Purchasers shall promptly pay. when due, all assessments impoe~ by the owners' sanitation other governing body aa required by the proviaion~ of the declaration or other related document: and (b) ~o long aa the owners' association maintains a maa~r or blanket policy of insurance against fire, extended coverage perils and such other hazards and in such amoun~ aa a~ required by this contract, then: (i) Purchasers' obligation in this contract to maintain hazard insurance coverage on the Property is satisfied; and (ii) The provisions in paragraph 8 of this contract regarding application of insurance pweeeda shall be supe~eded by the provisions of the declaration ar other reined document~; and (iii) In the event cfa distribution oglnauranee proceeds in lieu ofres~ratims ~r repair following an .insured casualty lose to the Property, any ~ueh process payable to Purchasers are hereby aasign~ and shall be paid ~ ~ller for application to ~he aura secured by this contract, with the ex~as, if any, paid ~ 20. ADDI~ONAL TE~S: a~ ~all m~ &.~g ~ tom oi ~is mn~, ~u~ any mterial ~ ~ dell~ °r ~e ~s~ o~ 3,00~.O0 ~less ~ first ~i~ ~it~ ~n~ qf ~11~. Bu~r furU~er a~ees .~ x~e~ a~ ~ld ~less ~11~ ag~t all ola~. for 1~ ~ ~=erials State of Minnesota C]ounty of ~1~*nr~r~ q The foregoing 'instrument was aaknOwl~ed ~fo~ me this ~ day of lt~us~ 19~, ~unt~ o~' S~te of Mlnn~o~ ~e foregoing instrument was aeknowl~ed ~fo~ me ~ie , ' day of . 5701 Kent~ Ave. ~. 7609 ~ss T~ C~s~, ~. 55428 ~ ~, ~. 55428 / LOAN AMORT~ZATXON SCHEDULE PREPARED BY MID#EgT ~NANG£ PUBLiSHINg CO.. MXNNEAPOLZ~, MZNNESOTA LOAH AMOUNT ...... $72,~}00.00 ~NTEREST BASXS 260 DAY INTEREST RATE ....... ..... 9% PMNT ZHTEHVAL MONTHLY PAYMENT AMOUNT ...... eS91.40 OUR RUN DATE AUO 21 92 # Or PAYMENTS .......... gAO OUR REFERENCE ~9 7609 BASG LAK~ ROAD PMNT DUE DATE PAYMENT ~NTEREST PRZNCIPAL BALANC~ REMARKS I SEP 18 92 591.40 551.25 40. 15 73, 459.85 2 OCT 18 92 591.40 550. 95 40. 45 73, 419.40 3 NOV 18 92 591.40 550.65 40. 75 73, 378.65 4 . DEC La 92 591.40 ~50.34 41.06 73,337.~9 92 - TOTAL-e iRT PAXD $2,203.19 PRX# PAID ~162.4t 5 JAN 18 93 ~91.40 550,03 41.37 73,296.22 & FEB 18 93 ~91.40 549,72 4t,68 73,254.54 7 NAR 18 93 591.40 549.41 41.9~ 73,212.~5 8 APR tS 93 591.40 549.09 42.31 73,170.24 9 ~AY 18 93 591.40 '548.78 42.~2 73,127.62 10 SUM 18 93 ~91.40 ~48.46 42.94 73,084.68 1! 3UL 18 93 591.40 548.14 43.26 73,041.42 L2 AUG ~8 93 59~.40 547.81 43.59 72,997.83 13 ~EP L8 93 591.40 547.48 43.92 72,9~3.9~ t4 OCT 18 93 ~91.40 547.1~ 44.25 72,909.66 t~ NOV 18 93 591.40 546.82 44.58 72,805.08 16 DEC 18 93 59~.40 546.49 44.91 72,820.~7 93 .*TOTAL*- XHT PAID $6,579.38 PRXM PAXD $5~7.42 17 SAN 18 94 5~t. 40 546.~ 45.25 72,774.92 t8 FEB ~8 94 ~91.40 345.8~ 45.59 72,729.33 19 NAR ~8 94 591.40 ~4~.47 45.93 72,683.40 20 APR 18 94 591.40 545.13 46.27 72,637.13 21 HAY 18 94 ~9~.40 ~44.78 46.62 72,590.51 22 3UN 18 94 591.40 ~44.43 46°97 72,543.54 23 JUL ~6 94 591.40 544.08 47.32 72,496.22 24 AUG 18 94 59t. 40 543.72 47.68 72,448.54 25 .gKP 18 94 ~9~.40 543.36 48.04 72,400.50 26 OCT ~8 94 591.40 ~43.00 48.40 72,352.10 27 NOV 16 94 591.~ 542.64 48.76 72,303.34 28 DEC t8 94 /~ ~ 542.28 49.~2 72,254.22 94 --TO?A~*, ZNT PAXD,_~,~3~.85 } PRXM PAID ~565.95 29 JAN 18 95- '. . 541o9~ 49.49 72,204.73 30 FEB 18 95 591.'40' ' ~4~.~4 49.86 72,154.87 31 MAR t8 9~ 59Z.40 ~41.'16 50.24 72,104.63 32 APR 18 95 ~91.40 540.76 50.62 72,034.01 33 MAY 18 95 591.40 540.41 50.99 72,003.02 34 JUN 18 95 59to40 540.02 51.38 71,951.64 39 NOV 18 95 591.40 5:38.07 53.3g 2 40 DEC 18 95 591.40' 537.67 53.73 71,635.19 g5 --TOTAL~o :MT PAZD $~,477.77 PRZ# PA~D ~L9.03 41 SAN 18 96 591.40 537.26 54.~4 71,581.05 42 FEB 18 96 59~.40 536.86 54.54 71 526.5! 43 NAR 18 96 591.40 536. 45 54.95 7~ 471.56 44 APR 18 96 ~91.40 536. 04 55. 38 71 416. 20 45 MAY 18 96 591.40 5~5.62 55. 78 71 360. 42 46 3UN 18 96 $91.40 535.20 56.20 71 304.22 47 JUL 18 96 591.40 534.78 ~i6.62 71 247.60 48 AUG 18 96 591.40 .534.30 57.04 71 190.56 49 SEP 18 90 591.40 533.93 57.47 71 133.09 50 OCT 18 96 591.40 533.50 57.90 71 075.19 51 NOV 18 96 591.40 ~33,06 58,34 7t 0t6.85 · 2 DEC t6 96 59L. 40 ~32.63 58.77 70 958.08 9~ ~-TOTAL** INT PAXD $S, 4t9.69 PRXN PAXD 0677.11 3 JAN 18 97 591.40 532.19 '59.21 70,896.87 54 FEB 18 97 ~9L. 40 531.74 59.66 70,839.21 ~5 MAR 18 97 591.40 ~31.29 60. t! 70,779.10 50 APR 18 97 591.40 530.84 60.56 70,718.54 57 HAY L8 97 591.40 530.39 61.01 70,657.53 56 JUN 18 97 ~91.40 529.93 61.47 70,596.06 ~9 JUL 18 97 591.40 529.47 61.93 70,534.~3 60 AUG 18 97 59L.40 ~29.01 62.3~ 70,471.74 COUNTY ASSESSOR AE1O3 GOVERNMENT CENTER NINNEAPOLIS RN 55487 U.S. ~T~ P~O R ESIOENTIAL H~aESTEAD R~t, read ~e ~k ~ this hotel 8t~p 1: To ~c~ your Valua~ N~ ~th ~. ~r~d~r, eMI: ES~TED ~RK~:VALUE. '.. · .' ' ?Oe LIMITED MARKET VALUE rO*O00 ~ a ~er m reem~l~e to I~ ~. T~ ~g ~ be he~ ~ APR QUALI~INGVALUE AT NE~ HOPE COUNCIL CHAMBERS FOR IMPROVE~NTS MARK~ VALUE Y~ FOR TAXATION Z0, 0 0 0 Equ~zat~n I~ on the back ~ INs ~1~. RONkLO R C SHAR[E S HUEBNER 7609 8ASS LAKE lO NE~ HOPE HENNEPIN COUNTY 1995 PROPERTY TAX STATEMENT PEN~, PAY. Em ANDESCROW INFORMATION Office Hour- 8 to 5- Monday- F.day Phone 612-348-3011 PROPER~ ID NO. Q~-)le-Z) S~ 0~9 learing Impaired w~h ~D Equipment 612-348-3461 Prope~ Class[es): ................... HOHESTEAB ~PAYER ~ ~E~ New Im~mvemems: ......................... i ~ed ~ke! VaI~: 6~ ,600 67 T~le Mmkel VaI~: ..................... 6~, 600 67 RONAC~ X & SNAR]E S HUEINER 7609 lASS LAKE RD NE~ HOPE ~a SSqZe-SB28 ~. U~thlsamount on Fo~ M-IPR Io ~ II ~u'm 81iBible ~ U~ th~ ~u~ for the ~ecial pm~ ~ mfu~ on *"~" ...... Y~ Prope~ Tax ~ How It Is Redue~ By The State ~A~ OF A~RXCA TRUSTEE 4. ~ pM by the s~ of M~ ~ re,ce ~r ~ tax ........ ~7]. [ 0 b. ~r c~s ................................................................................... ~O ,00 ~L W~ 8~R 854.17 908. )A z81 o 0z ,, Whm Y~r PrM~ Tax Dollars Go, ,, . 7. C~ ............................................................................................ 241.86 253. ~ ADD. ESS : 8, M~a~ ....................................................................................... 150.78 76~9 ~ASS LA[E RD ~ ~~i~E~e~Lew~f~n~Ta~ ..................................... 98.01 - ~ ~ ~ Re~ ~h~ Tax 323.23 352. ~E9. LAND SURVEY NO. 0848 : l~.~MrS~mJT~d~ ............................................................ 11.77 [5.77 BLOCK r~TS C AMD 0 rGC~E c~. 1~ ~ P~dy Tax B~I 126. ~3 )68 000000000S5S501 SPECZAL /KTEREST 22.56 23. 14. TOTAL ~ERTY T~ AND SPEC~L ASSESS~N~ .............. 9 9Z. B6 [, ~ 6 5. , ~ Ch~k Pay~ ~ HEN~P~ C~ TREAeUR~ ~ ~ t~s ~x is ~cked ~u owe ~n~nt ~xe8 a~ Co~ ~r ~ tor the amou~ ~e. ~. ~y th~ e~unt no ~ ~an O~ 15. ~ ........................ 582 :~ . ~RE BEF~E ~[ING ~ D~ACH PA~ENT STUB HERE BEFORE MA~LING BCL Appraisals, Inc. Bjorklund, Carufel. Lachenmayer, Incorporated luly 6, 1995 City of New Hope 4401 Xylon Avenue North New Hope, Mn 55428 Attention: Kirk McDonald Attached is the appraisal completed on July 6, 1995 for the property at: 7609 Bass Lake Road New Hope, Mn $$425-3828 Sherri Huebuer The estimate '~Nf.~t[~' as of July 6, 1995 is: Sixty-Five 'l'nomad Dollars . No respomibUity has been assumed for matters which are legal in nature, nor any opinion on them been rendered other than assuming marketable title. Liens ami ~cumbranc~, if'any, lmve ~ disregarded and the property was appraised as though fr~ of ~. in conmucuon or mamsemncs of tho building, SUCh as me presence or uru-formaldohy~a foam insulation, asbestm, and/or the ~Xisten~. of sub_ .sic. rices such as toxic wast~ or radonl Sm, and/or tl~ existence ot any omer environmenuu influenc~ that may adv~ affect the value of. the.property, was not observed by me: nor do I have am/~ of the existence or such ma~. ,.r~a~. sub.mnce~' .influences on or in the promar. The appraiser, however, is not q _ualinea to aetect suc.n . . maleriais/~influences. Th~ exislence of urea-formaldehyde foam msutauon, or other potentially hazardous amc or _.umc. waste or r .on gas, may. have effect on the value of Ute property, I urSe me cUent to retain an expert ua Pleasa feel fr~ to carl if you have any questions. We appmciat~ your business. Sincerely, BCL Appraise, Inc. Ron L~hdnmiYe?, SRA t/DA ~ REQUF~T FOR ACTION Originating Department Approved for Agenda Agenda Section City Manager EDA Kirk McDonald Item No. By: Management Assistant By: 5 DISCUSSION REGARDING GUIDELINES FOR FINANCIAL ASSISTANCE TO BUSINESSES On the September 12th Council Work Session Agenda a topic to be discussed was Guidelines for Financial Assistance to Businesses. Included in that packet were a number of documents describing how the City works with the private sector regarding financial assistance and goals and objectives for commercial, industrial and housing sectors of the community. These documents included: Comprehensive Plan 42nd Avenue Improvement Study Vacant Land Study Industrial Revenue Bond Guidelines Multi-Family Housing Policies The Council directed that this matter be placed on this agenda for discussion and staff have not reproduced all of the attachments, so please refer to your Work Session packet for those materials. The Council/EDA need to provide direction as to whether you want to see more specific policies regarding financial assistance to the private sector. In the past the Council and EDA have considered requests from the private sector on a case by case basis. The assistance has been based upon existing funds and the perceived need, as well as whether the use complied with the guidelines of the Comprehensive Plan. It may be difficult to develop a policy that covers every situation and need. MOTION BY SECOND BY Review: Administration: Finance: RFA-O01 ~ EDA [~(i~ ~ !tO/ REQUF_~T FOR ACTION Originating Department Approved for Agenda Agenda Section City Manager EDA 9-25-95 Kirk McDonald ~ Item No. By: Management Assistant By:///// 6 DISCUSSION REGARDING DEVELOPMENT AGREEMENT WITH GILL BROTHERS FUNERAL CHAPELS, INC. (IMPROVEMENT PROJECT NO. 523) Staff requests to discuss with the EDA the enclosed proposed Development Contract for the Gill Brothers Funeral Chapels project. The proposal, drafted by the City Attorney, is a "pay as you go" tax increment financing project as discussed in the City's Bond Consultants August l lth letter. The arrangement would be for the EDA to reimburse the developer for eligible costs from the tax increment received from the property after it is developed as a funeral chapel. The project is located in Redevelopment/Tax Increment Financing Project 85-2. The Finance Director has indicated that the frozen tax capacity or value of the property is $17,826. Assuming taxable market values on the completed project ranging from $1,000,000 to $1,195,000, the available tax increment generated by the funeral chapel project would be approximately $415,937 over the remaining life of the TIF District (2006). This increment could be used to reimburse the Developer for eligible costs. Per the enclosed Schedule D, costs eligible for reimbursement could be as much as $387,806. Staff requests that the EDA give staff direction regarding the extent to which tax increment f'mancing assistance will be provided to this developer. The details of the development proposal could then be fmalized and a bond resolution could be prepared for consideration at the October 9th EDA meeting. The EDA should also consider how or if this property could be sold or developed without TIF assistance, taking into consideration the long/narrow shape of the property and previous soil contamination issues. The EDA also should discuss wage level and job creation goals, as outlined in the attached correspondence from the City Attorney. Staff have made this preliminary draft Development Agreement available to representatives of Gill Brothers and they may be in attendance at the EDA meeting. (Gill Brothers has submitted an application and plans for site/building plan review/approval and will be appearing before the Planning Commission on October 3rd.) MOTION BY SECOND BY Review: Administration: Finance: RFA-O01 CORRICK & SONDRALL, P.A. STEVEN A. SONDRALL ATTORNEYS AT LAW ~ MICHAEL R. LAFLEUR MARTIN P. MALECHA Edinburgh Executive Office Plaza SH&RON O. DERBY WILLIAM C. STRA,T 8525 Edinbrook Crossing Suite ~203 Brookl~ P~k, Minneso~ 55443 TELEPHONE (612) 42~671 F~ (612) 42~5867 September 20, 1995 Kirk McDonald Management Asst. City of New Hope 4401Xylon Avenue North New Hope, MN 55428 RE: Development Agreement with Gill Brothers Funeral Chapels, Inc. Our File No: 99.11141 Dear Kirk: Please find enclosed a proposed Development Contract and attachments for the Gills Brothers Funeral Chapels project. Basically, this proposal is a "pay as you go" tax increment financing project discussed in Jerry Gilligan's August 11, 1995 letter. The arrangement would be for the EDA to reimburse the developer for eligible costs from the tax increment received from the property after it is developed as a funeral chapel. The project is located in Redevelopment Project and Tax Increment Financing Project 85-2. The Finance Director indicates the frozen tax capacity or value of the property is $17,826.00. Assuming taxable market values ranging from $1,000,000 to $1,195,000 available tax increment generated by the funeral chapel project over the remaining life of the District would be approximately $415,937.00. This increment could be used to reimburse the Developer for eligible costs as set out in the enclosed documents. At this time we need direction from the Economic Development Authority regarding the extent to which tax increment financing assistance will be provided to this Developer. As pointed out in the proposed Schedule D, costs eligible for reimbursement could be as much as $387,806.00. It is my recommendation that this proposal should be placed on the September 25, t995 EDA agenda for further discussion and a request Kirk McDonald September 20, 1995 Page 2 for direction on the amount of tax increment financing assistance we wish to provide this Developer. We can then finalize the details of the enclosed development proposal and prepare a bond resolution for consideration at the October 9, 1995 meeting if the Developer wishes to go ahead with the project based on the tax increment financing assistance proposed by the EDA. The EDA should consider how or if this property can be sold or developed without tax increment financing assistance. Also, under a new taw codified as Minn. Stat. §116J.991 the developer must provide it will create a net increase in jobs to qualify for the assistance. We must establish wage level and job creation goals the developer must meet to qualify for the assistance. If these goals are not met, the developer will be required to repay the assistance per Minn. Stat. §116J.991. These job creation goals must be discussed both with the EDA and developer. Please contact me if you have any other questions or comments. Very truly yours, Stev~~nn ~. Sondrall slw2 Enclosures cc: Daniel J. Donahue, Oity Manager (w/eric) Larry Watts, Finance Director (w/eric) Valerie Leone, City Clerk '(w/enc) Jerry Gilligan, Esq. (w/eric) REDEVELOPMENT AGREEMENT REDEVELOPMENT PROJECT NO. 85-2 (42ND AVENUE/CITY CENTER AREA) ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF NEW HOPE, MINNESOTA AND GILL BROTHERS FUNERAL CHAPELS, INC. , 1995 TABLE OF CONTENTS Section 1.1Def4nitions ............................................ Section 2.1 By EDA ................................................ Section 2.2 By Redeveloper ........................................ Section 3.1 Use ................................................... Section 3.2 Declaration of Restrictions ............................ Section 4.1 Construction Plans .................................... Section 4.2 Construction of Minimum Improvements .................. Section 4.3 Certificate of Completion .............................. Section 5.1 Defense of Claims ..................................... Section5.2Insurance ............................................. Section 6.1 Issuance of Bond ...................................... Section 7,1 Transfer of Property and Assignment .................... Section 7,2 Termination of Limitations on Transfer ................ Section 8,t Events of Default ....................... ~ ............. Section 8.2 Remedies on Default ................................... Section 8,3 No Remedy Exclusive ................................... Sectiona.4Waivers ............................................... Section 9.1 Conflict of Interests; EDA Representatives Not Individually Liable ........................................... Section 9,2 Equal Employment Opportunity .......................... Section 9.3 Restrictions on Use ................................... -i- Section 9.4 Titles of Articles and Sections ....................... Section 9.5 Notices and Demands ................................... Section 9.6 Term of Agreement ..................................... Section9.7Counterparts .......................................... Schedu]e A Redevelopment Property Schedule B Project Description Schedule C Time Table Schedule D Portion of Project the Costs of Which are Eligible for Reimbursement from Bond Exhibit A Certificate of Completion Exhibit B Covenants and Restrictions Exhibit C Form of Bond -ii- REDEVELOPMENT CONTRACT This Agreement is made as of,1 995, by and between the ECONOMIC DEVELOPMENT AUTHORITY ~N AND FOR THE CITY OF NEW HOPE, MINNESOTA, a public body corporate and politic (the "EDA"), and GILL BROTHERS FUNERAL CHAPELS, INC., a Minnesota corporation ("Redeveloper"). WITNESSETH' WHEREAS, the EDA was created pursuant to state law now codified as Minnesota Statutes, Sections 469.090 through 469.1081 (the "Act") and was authorized to transact business and exercise its powers by an ordinance and resolution of the City Council of the City of New Hope (the "City") adopted on March 27, 1989; and WHEREAS, in furtherance of the objectives of the Act, the EDA has assumed control of a program established and undertaken by the Housing and Redevelopment Authority in and for the City of New Hope for the clearance and redevelopment of blighted, vacant and unused areas of the City and in this connection is engaged in carrying out a redevelopment project as defined in Minnesota Statutes, Section 469.002, Subdivision 14, known as Redevelopment Project No. 85-2 (the "Redevelopment Project")'in the area in the City encompassing the property abutting on the north side of 42nd Avenue North from Nevada Avenue North west to the railroad tracks as shown on Schedule A1 attached hereto (the "Project Area"); and WHEREAS, as of the date of this Agreement there has been prepared and approved by the EDA and the City Council pursuant to the Act a redevelopment plan for the Redevelopment Project, dated December 23, 1985, as amended by an amendment thereto dated June 22, 1987 (as so amended, the "Redevelopment Plan"); and WHEREAS, on December 23, 1985 the City Council adopted a resolution establishing the Project Area as a tax increment financing district; and WHEREAS, the major objectives of the Redevelopment Plan are to: 1. Provide compatible and complementary land uses. 2. Provide more homogeneous land uses and street treatment along 42nd Avenue in order to unify development and provide a positive image of the City. 3. Promote and secure development and redevelopment in a manner that allows the most logical and efficient arrangement and intensity of land uses. 4. Promote and secure the retention of existing jobs and gain new employment opportunities in the area. 5. Promote and secure development and redevelopment in a manner that will have minimum adverse impact on the environment. 6. To undertake certain ]and acquisition, parcel assembly and parcel disposition necessary to eliminate certain substandard and non-conforming uses and buildings, and to assemble logical, conforming and more efficient building sites. 7. To promote and secure increased landscaping on private property and public rights of way to improve the asthetics, provide identity for the commercial areas and improve transitions between commercial and residential areas. and WHEREAS, in order to achieve the objectives of the Redevelopment Plan, the EDA intends to provide aid and assistance to the Redeveloper through tax increment financing, as described in Minnesota Statutes, Sections 469.174 through 469.179 to finance the cost of the acquisition by the Redeveloper of property located in the Project Area shown on Schedule A-1 attached, on which the Redeveloper will construct a funeral chapel; and WHEREAS, the EDA and the City believe that redevelopment of a portion of the Project Area pursuant to this Agreement is in the best interests of the City and benefits the health, safety, morals and welfare of its residents, and complies with the applicable state and local laws and requirements under which the Redevelopment Project has been undertaken and is being assisted. NOW, THEREFORE, in consideration of the foregoing premises and the mutual obligations set forth in this Agreement, the parties hereto hereby agree as follows: ARTICLE 1 Definitions Section 1.1. Definitions. In this Agreement, unless a different meaning clearly appears from the context: "Act" means Minnesota Statutes, Sections 469.090 through 469.1081 and 469.001 through 469.047. "Agreement" means this Agreement, as the same may be from time to time modified, amended or supplemented. "Bond Resolution" means the resolution or resolutions adopted by the Board of Commissioners of the EDA authorizing the issuance and setting forth the terms and security for the Bond. "Bond" means The Limited Revenue Taxable Tax Increment Bond in substantially the form of Exhibit C hereto to be issued by the EDA pursuant to the Bond Resolution and to be delivered by the EDA to the Redeveloper as provided in Section 6.1 hereof. "Certificate of Completion" means a certification in the form attached as Exhibit A, to be provided to Redeveloper pursuant to this Agreement. "City" means the City of New Hope, Minnesota, a Minnesota municipal corporation, "Construction Plans" means the plans, specifications, drawings and related documents for the construction work to be performed by the Redeveloper on the Redevelopment Property as a part of the Project, which (a) shall be at least as detailed as the plans, specifications, drawings and related documents which are submitted. to the building official of the City and (b) shall include at least the following: (1) site plan; (2) foundation plan; (3) basement plans; (4) floor plan for each floor; (5) elevations on all sides; (6) landscape plan; (7) grading plan; and (8) utility plan. "Event of Default" means as set forth in Section 9.01 hereof. "EDA" means the Economic Development Authority of New Hope, Minnesota, a public body corporate and politic under the laws of the State of Minnesota. "Improvements" means the buildings or other improvements located on the Redevelopment Property. 3 "Mortgage" means any mortgage made by Redeveloper which covers, in whole or in part, the Redevelopment Property. "Mortgagee" means the owner or holder of a Mortgage. "Net Proceeds" means any proceeds paid by an insurer to Redeveloper and the EBA under a policy or policies of insurance required under Article 5 and remaining after deducting all expenses (including fees and disbursements of counsel) incurred in the collection of the proceeds. "Project" means the acquisition and clearing of the Redevelopment Property and the construction thereon of a two story colonial style funeral chapel with approximately 6,500 square feet on the first floor with an exterior drop-off canopy and circular drive, and the construction of site improvements and other improvements of a public nature, all as further described in Schedule B attached to this Agreement. "Project Area" means the area designated for redevelopment by the EDA pursuant to the Redevelopment Plan and the Act. "Plans" means Redeveloper's plans dated , 1995 for the Project as submitted to the EDA, with any subsequent amendments approved by the EDA. "Redeveloper" means Gill Brothers Funeral Chapels, Inc., a Minnesota corporation. "Redevelopment Plan" means the Redevelopment Plan approved by the City on December 23, 1985, as amended by an amendment thereto dated June 22, 1987. "Redevelopment Property" means the portion of the Project Area described on Schedule A and A-1 attached hereto. "Restrictions" means the easements, covenants, conditions and restrictions set forth in Exhibit B. "Section" means a Section of this Agreement, unless used in reference to Minnesota Statutes. "State" means the State of Minnesota. "Tax Increment Act'" means Minnesota Statutes, Sections 469.174 through 469.179. "Tax Increment District" means Tax Increment Financing District 85- 2 created by the EDA pursuant to the Tax Increment Financing Plan. "Tax Increment Financing Plan" means Tax Increment Financing Plan 85-2 approved by the Housing and Redevelopment Authority and the City Council and dated December 23, 1985, the control over which the EDA has assumed by resolution dated April 10, 1989. Time Table" means the schedule of performance dates for certain actions by Redeveloper under this Agreement, attached hereto as Schedule C and made a part hereof. "Unavoidable Delay means a failure or delay in a party s performance of its obligations under this Agreement, or during any cure period specified in this Agreement which does not entail the mere payment of money, not within the party's reasonable control, including but not limited to acts of God, governmental agencies, the other party, strikes, labor disputes (except disputes which could be resolved by using union labor), fire or other casualty, or lack of materials; provided that within 10 days after a party impaired by the delay has knowledge of the delay it shall give the other party notice of the delay and the estimated length of the delay, and shall give the other party notice of the actual length of the delay within 10 days after the cause of the delay has ceased to exist. The parties shall pursue with reasonable diligence the avoidance and removal of any such delay. Unavoidable Delay shall not extend performance of any obligation unless the notices required in this definition are given as herein required. ARTICLE 2 Representations and Warranties Section 2.1. By EDA. EDA makes the following representations to Redeveloper: (a) EDA is an economic development authority duly organized and existing under the laws of Minnesota. Under the provisions of the Act, EDA has the power to enter into this Agreement and carry out its obligations hereunder. (b) The Redevelopment Project is a "redevelopment project" within the meaning of the Act and was created, adopted and approved in accordance with the terms of the Act. (c) The Tax Increment District is a "tax increment district" within the meaning of the Tax Increment Act and was created, adopted and approved in : accordance with the terms of the Tax Increment Act. (d) The costs relate'd to the portion of the Project described in Schedule D hereto constitute public redevelopment costs as 5 defined in Minnesota Statutes, Section 469.033, which are permitted to be paid from Tax Increment, pursuant to Minnesota Statutes, Section 469.176. The EDA proposes to financially assist Redeveloper by reimbursing all or a portion of such costs paid by the Redeveloper from payments to be made on the Bonds. ,Section 2.2. By Redeveloper. Redeveloper represents and warrants that: (a) Redeveloper is a Minnesota for profit corporation organized and incorporated under the laws of Minnesota, under no legal disability and has power to enter into this Agreement. (b) Redeveloper will, subject to Unavoidable Delays, complete the Project in accordance with the terms of this Agreement, the Redevelopment Plan, the Act, and all local, state and federal laws and regulations. (c) Redeveloper has received no notice or communication from any local, state or federal official that the activities of Redeveloper, the City or EDA with respect to the Redevelopment Property may be or will be in violation of any envi'ronmental law or regulation. Redeveloper is aware of no facts the existence of which would cause it to be in violation of any local, state or federal environmental law, regulation or review procedure with respect to the Redevelopment Property. (d) Neither the execution or delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement is prevented by, limited by, conflicts with, or results in a breach of, any restriction, agreement or instrument to which Redeveloper is now a party or by which it is bound. (e) The Redeveloper (i) is not in default in the payment of the principal of or interest on any indebtedness for borrowed money; or (ii) is not in default under any instrument or agreement under and subject to which any indebtedness for borrowed money has been issued. (f) The Redeveloper would not undertake the Project but for the tax increment financing assistance being provided by the EDA hereunder. (g) No member of the governing body of the City or EDA or any other officer of the City and EDA has any direct or indirect financial interest in the Redeveloper, the Redevelopment Property or the Project. (h) The project will create a net increase in jobs in Minnesota within two years from the date Redeveloper receives its first reimbursement payment under the bond as required by Minn. Stat. §116J.991. If Redeveloper fails to establish a net increase in jobs which has resulted from the project, Redeveloper agrees to repay all payments received under the Bond. ARTICLE 3 Use of Redevelopment Property; Restrictions Section 3.1 Use. Redeveloper's use of the Redevelopment Property shall be subject to and in compliance with all of the conditions, covenants, restrictions and limitations imposed by the Redevelopment Plan, this Agreement, the Restrictions and all applicable laws, ordinances and regulations. Section 3.2 Declaration of Restrictions. Redeveloper shall prepare, execute, and record on the title to the Redevelopment Property a Declaration of Covenants and Restrictions, in form approved by the EDA, which includes the Restrictions set forth on Exhibit B, and shall cause each existing Mortgagee to execute an appropriate instrument in form satisfactory to the EDA consenting to and agreeing to be bound by the Restrictions in the event it becomes a record owner of all or a part of the Redevelopment Property. ARTICLE 4 Completion of Project Section 4.1 Construction Plans. Redeveloper shall submit Construction Plans to the EDA according to the Time Table. The Construction Plans shall provide for construction of the portion of the Project consisting of construction in conformity with the Redevelopment Plan, the Plans, this Agreement, and all applicable state and local laws and regulations. The. EDA shall approve the Construction Plans in writing if no Event of Default has occurred and, in the reasonable discretion of the EDA, the Construction Plans: (a) substantially conform to the Plans and subsequent amendments approved by the EDA; (b) conform to the terms and conditions of this Agreement; (c) conform to the terms and conditions of the Redevelopment Plan; (d) conform to all applicable federal, state and local taws, ordinances, rules and regulations; (e) are adequate to provide for construction of the portion of the Project consisting of construction; and (f) provide for minimum disturbance to neighboring properties during construction. No approval by the EDA shall relieve Redeveloper of the obligation to comply with the terms of this Agreement, the terms of the Redevelopment Plan, applicable federal, state and local laws, ordinances, rules and regulations, or to construct the Minimum Improvements. No approval by the EDA shall constitute a waiver of an Event of Default. Any disapproval of the Construction Plans shall set forth the reasons therefor, and shall be made within 30 days after the date of their receipt by the EDA. If EDA rejects the Construction Plans, in whole or in part, Redeveloper shall submit new or corrected Construction Plans within 30 days after written notification to Redeveloper of the rejection. The provisions of this Section relating to approval, rejection and resubmission of corrected Construction Plans shall continue to apply until the Construction Plans have been approved by EDA. Section 4.2 Undertaking of Project. (a) Subject. to Unavoidable Delays, Redeveloper will complete the Project all in accordance with the Plans, the Construction Plans and the Time Table. (b) All work with respect to the portion of the Project consisting of construction shall be in substantial conformity with the Construction Plans approved by the EDA. Redeveloper shall promptly begin the Project and diligently prosecute the Project to completion. Redeveloper shall make reports, in such detail and at such times as may reasonably be requested by the EDA, as to the actual progress of Redeveloper with respect to the Project. (c) Redeveloper shall not interfere with, or construct any improvements over, any public street or utility easement without the prior written approval of the City. All connections to public utility lines and facilities shall be subject to approval of the City and any private utility company involved. Except for public improvements which are assessable by the City or other governmental body against other benefitted properties, all street and utility installations, relocations, alterations and restorations shall be at Redeveloper's expense and without expense to the City or the EDA. Redeveloper at its own expense shall replace any public facilities or utilities damaged during the Project. Section 4.3 Certificate of Completion. (a) Promptly after completion of the Project in accordance with this Agreement, Redeveloper will provide the EDA with a certificate of substantial completion from Redeveloper's architect and the certificate of Redeveloper required by Section 6.1 hereof, and the EDA will furnish Redeveloper with an appropriate 8 Certificate of Completion as conclusive evidence of satisfaction and termination of the agreements and covenants of this Agreement with respect to the obligations of Redeveloper to complete the Project. The furnishing by the EBA of the Certificate of Completion shall not constitute evidence of compliance with or satisfaction of any obligation of Redeveloper to any Mortgagee. (b) If the EDA shall refuse or fail to provide the Certificate of Completion, the EDA shall, within 15 days after the Redeveloper provides the architect's certificate referenced in Section 4.3(a), provide Redeveloper with a written statement specifying in what respects Redeveloper has failed to complete the Project in accordance with this Agreement, or is otherwise in default, and what measures or acts will be necessary, in the opinion of the EDA, for Redeveloper to obtain the Certificate of Completion. ARTICLE 5 Defense of Claims; Insurance; Condemnation Section 5.1 Defense of Claims. Redeveloper shall indemnify and hold harmless the EDA and the City and their respective officers, employees and agents for any loss, damages and expenses (including attorneys' fees) in connection with any claims or proceedings arising from damages or injuries received or sustained by any person or property by reason of any actions or omissions of Redeveloper or its contractors, agents, officers or employees or arising out of or relating to this Agreement or the transactions contemplated by this Agreement, other than claims or proceedings arising from any negligent or unlawful acts or omissions of the EDA, the City or their contractors, agents, officers or employees. Promptly after receipt by the EBA or City of notice of the commencement of any action in respect of which indemnity may be sought against the Redeveloper under this Section 5.1, such person will notify the Redeveloper in writing of the commencement thereof, and, subject to the provisions hereinafter stated, the Redeveloper shall assume the defense of such action (including the employment of counsel, who shall be counsel satisfactory to the EBA or City, as the case may be, and the payment of expenses) insofar as such action shall relate to any alleged liability in respect of which indemnity may be sought against the Redeveloper. The EDA or the City shall have the right to employ separate counsel in any such action and to participate in the defense thereof, but the fees and expenses of such counsel shall not be at the expense of the Redeveloper unless the employment of such counsel has been specifically authorized by the Redeveloper. The Redeveloper shall not be liable to indemnify any person for any settlement of any such action effected without its consent. The omission to notify the Redeveloper as herein provided will not relieve it from any liability which it may have to any indemnified party pursuant hereto, otherwise than under this section. Section 5.2 Insurance. (a) The Redeveloper shall keep and maintain the Redevelopment Property and Improvements at all times insured against such risks and in such amounts, with such deductible provisions, as are customary in connection with facilities of the type and size comparable to the Improvements, and the Redeveloper shall carry and maintain, or cause to be carried and maintained, and pay or cause to be paid timely the premiums for direct damage insurance covering all risks of loss, including, but not limited to, the following: (1) fire (2) extended coverage perils (3) vandalism and malicious mischief (4) boiler explosion (but only if steam boilers are present) (5) water damage (6) debris removal (7) collapse on a replacement cost basis in an amount equivalent to the full insurable value thereof. ("Full insurable value" shall include the' actual replacement cost of the Improvements (exclusive of foundations and footings) without deduction for architectural, engineering, legal or administrative fees or for depreciation.) Insurance in effect with respect to any portion of the Improvements to be renovated or remodeled as a part of the Project prior to the issuance by the EDA of a Completion Certificate under Section 4.3 hereof with respect thereto shall be maintained on an "all-risk" builder's risk basis during the course of construction. The policies required by this Section 5.2 shall be Subject to a no coinsurance clause or contain an agreed amount clause, and may contain a deductibility provision not exceeding $25,000. (b) Policies of insurance required by this Section 4.3 shall assure and be payable to the Redeveloper, and shall provide for release of insurance proceeds to the Redeveloper for restoration of loss. The EDA shall be furnished certificates showing the existence of such insurance. In case of loss, the Redeveloper is hereby authorized to adjust the loss and execute proof thereof in the name of all parties in interest. The Redeveloper shall annually file with the EDA a schedule describing all such policies in force, including the types of insurance, names of insurers, policy numbers, effective dates, terms of duration or any other information the EDA deems pertinent. Such list shall be accompanied 10 by a certificate executed by the Redeveloper stating that, to the best of the knowledge of the Redeveloper, insurance on the Improvements then in force complies with this Section 4.3. ARTICLE 6 Issuance of Bond Section 6.1 Issuance of Bond. In order to reimburse the Redeveloper for all or a portion of the costs paid by the Redeveloper as to that portion of the Project identified on Schedule D hereto, the EDA' agrees to issue the Bond to the Redeveloper. The Bond shall be originally issued in the principal amount of $387,806.00, and interest on the Bond shall accrue from the date of issuance by the EDA of the Certificate of Completion at the interest rate provided in the Bond. The Redeveloper acknowledges that no payments shall be due and owing on the Bond after December 31, 2006. The Redeveloper certifies that he has paid the costs identified in Schedule D hereto with respect to the Project, ARTICLE 7 Prohibitions Against Assignment and Transfer Section 7.1 Transfer of Property and Assignment. Redeveloper has not made and will not make, or suffer to be made, any total or partial sale, assignment, conveyance, lease (other than leases of space in the professional office building constructed as a part of the Project), or other transfer, with respect to this Agreement or the Redevelopment Property or any part thereof or any interest therein, or any contract or agreement to do any of the same, without the prior written approval of the EDA. The EDA shall be entitled to require as conditions to any such approval that: (i) the proposed transferee have the qualifications and financial responsibility, as reasonably determined by the EDA, necessary and adequate to fulfill the obligations undertaken in this Agreement by Redeveloper; (ii) the proposed transferee, by recordable instrument satisfactory to the EDA shall, for itself and its successors and assigns, assume all of the obligations of Redeveloper under this Agreement. No transfer of, or change with respect to, ownership in. the Redevelopment Property or any part thereof, or any interest therein, however consummated or occurring and whether voluntary or involuntary, shall operate, legally or practically, to deprive or limit the EDA of or with respect to any rights or remedies or controls provided in or resulting from this Agreement with respect to the Redevelopment Property and the completion of the Project 11 that the EDA would have had, had there been no such transfer or change. There shall be submitted to the EDA for review all legal documents relating to the transfer. In the absence of specific written agreement by the EDA to the contrary, no such transfer or approval by the EDA thereof shall be deemed to relieve Redeveloper, or any other party bound in any way by this Agreement or otherwise with respect to the completion of the Project, from any of its obligations with respect thereto. 7.2 Termination of Limitations on Transfer. The provisions of Section 7.1 shall terminate at such time as the Certificate of Completion has been issued by the EDA under Section 4.3 of this Agreement with respect to the Project. ARTICLE 8 Events of Default Section 8.1 Events of Default. The following shall be "Events of Default" under this Agreement and the term "Event of Default" shall mean, whenever it is used in this Agreement (unless the context otherwise provides), any one or more of the following events which occurs and continues for more than 30 days after notice by the EDA to Redeveloper of such default (and the term "default" shall mean any event which would with the passage of time or giving of notice, or both, be an "Event of Default" hereunder): (a) Failure of Redeveloper to complete the Project as required hereunder. (b) Failure of Redeveloper to furnish the Construction Plans as required hereunder. (c) Failure of Redeveloper to observe and perform any other covenant, condition, obligation or agreement on his part to be observed or performed hereunder or under the Restrictions. (e) If Redeveloper shall admit in writing his inability to pay its debts generally as they become due, or shall file a petition in bankruptcy, or shall make an assignment for the benefit of his creditors, or shall consent to the appointment of a receiver of ~tself or of the whole or any substantial part of the Redevelopment Property. Section 8.2 Remedies on Default. Whenever any Event of Default referred to in Section 8.1 occurs, the EDA may take any one or more of the following actions:' 12 (a) Suspend its performance under this Agreement until it receives assurances from Redeveloper, deemed adequate by the EDA, that Redeveloper wi]] cure its default and continue its performance under this Agreement. (b) Terminate ail rights of Redeveloper under this Agreement. (c) Withhold the Certificate of Completion. (d) Terminate the Bond. (e) Take whatever action at ]aw or in equity may appear necessary or desirable to the EDA to enforce performance and observance of any obligation, agreement, or covenant of the Redeveloper under this Agreement. (f) Failure of Redeveloper to create a net increase in jobs in Minnesota within two years after receiving its first reimbursement payment under the bond as required by Minn. Stat. §116J.991 and §2.2(h) of this agreement. Section 8.3. ~o Remedy Exclusive. No remedy herein conferred upon or reserved to the EDA is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy' given under this Agreement or now or hereafter existing at law or in equity or by statute. No de]ay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the EDA or Redeveloper to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such notice as may be required under this Agreement. Section 8.4. Waivers. All waivers by the EBA, shall be writing. If any provision of this Agreement is breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. ARTICLE 9 Additional Provisions Section 9.1 Conflict of Interests: EDA and City Representatives Not Individually Liable. No member, official, employee, or consultant or employees of the consultants of the EDA 13 or the City shall have any personal interest, direct or indirect, in this Agreement, nor shall any such member, official, consultant or the consultant's employees or employee participate in any decision relating to this Agreement which affects his or her personal interests or the interests of any corporation, partnership, or association in which he or she is directly or indirectly interested. No member, official, consultant or the consultant's employees, or employee of the EDA or the City shall be personally liable to Redeveloper, or any successor in interest, in the event of any default or breach by the EDA or the City or for any amount which may become due to Redeveloper or successor or on any obligations under the terms of this Agreement. Section 9.2 Equal Employment Opportunity. Redeveloper, for itself and its successors and assigns, agrees that during the construction of the Project it will comply with any applicable affirmative action and nondiscrimination laws or regulations. Section 9.3 Restrictions on Use. Redeveloper agrees for itself, and its successors and assigns, and every successor in interest to the Redevelopment Property, or any part thereof, that Redeveloper, and such successors and assigns, shall devote the Redevelopment Property to, and only to and in accordance with, the uses specified in the Redevelopment Plan and this Agreement, and shall not discriminate upon the basis of race, color, creed, sex or national origin in the sale, lease, or rental or in the use or occupancy of the Redevelopment Property or any improvements erected or to be erected thereon, or any part thereof. Section 9.4 Titles of Articles and Sections. Any titles of the several parts, Articles, and Sections of this Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 9.5 Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand, or other communication under this Agreement by either party to the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally as follows: (a) in the case of Redeveloper, addressed to or delivered personally to Redeveloper at Gill Brothers Funeral Chapels, Inc., c/o Daniel J. McGraw, Executive Office, Southwest Chapel, 5801 Lyndale Avenue So., Minneapolis, MN 55419. (b) in the case of the EDA, addressed or delivered personally to the EDA's Executive Director, 4401Xylon Avenue North, New Hope, Minnesota 55428; 14 (c) in the case of the City addressed or delivered personally to the City Manager at 4401Xylon Avenue North, New Hope, Minnesota 55428; or at such other address with respect to any such party as that party may, from time to time, designate in writing and forward to the other parties as provided in this Section. Section 9.6 Term of Agreement. This Agreement shall terminate upon the later to occur of (i) December 31, 2006, or (ii) the payment in full of the Bond; provided that notwithstanding the termination of this Agreement, the Restrictions shall remain in full force and effect until terminated in accordance with its terms. Section 9.7. Counterparts. This Agreement is executed in any number of counterparts, each of which shall constitute one and the same instrument. IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date first above written. ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF NEW HOPE, MINNESOTA By: Its President By: Its Executive Director GILL BROTHERS FUNERAL CHAPELS~ INC, By: Daniel J. McGraw, Its President 15 STATE OF MINNESOTA ) ) SS COUNTY OF HENNEP[N ) The foregoing instrument was acknowledged before me this day of , 1995, by the President and Executive Director Economic Development Authority in and for the City of New Hope, Minnesota. Notary Public STATE OF MINNESOTA ) )SS COUNTY OF HENNEP[N ) The foregoing instrument was acknowledged .before me this day of . , 1995, Daniel J. McGraw, President, Gill Brothers Funeral Chapels, Inc., a Minnesota corporation, on behalf of said corporation. Notary Public DRAFTED BY: CORRICK & SONDRALL, P.A. 8525 Edinbrook Crossing, #203 Brooklyn Park, MN 55443 t6 SCHEDULE A REDEVELOPMENT PROPERTY A-1 SCHEDULE B PROJECT DESCRIPTION B-1 SCHEDULE C The following events shall take place, subject to Unavoidable Delays (as defined in this Agreement) by the date specified. TIME TABLE Redevelopment Contract Section Task Date 5.2 Redeveloper provides proof of insurance. 4,1 Construction Plans submitted to EDA and City. a. EDA disapproval (30 days) b. Redeveloper resubmits Plans (30 days) 4.2 Project begins. 4.2 Project completed. 4.3 EDA issues or refuses to issue Certificate of Completion. C-1 SCHEDULE D PORTION OF PROJECT THE COSTS OF WHICH ARE ELIGIBLE FOR REIMBURSEMENT FROM BOND LAND $254,826 EXCAVATION & BACKFILL 28,800 LANDSCAPING & SPRINKLING 22,700 SANITARY SEWER & WATER 14,400 PARKING LOT 27,600 CURBING 9,480 UTILITY 30~000 TOTAL: $387,806 D-1 EXHIBIT A CERTIFICATE OF COMPLETION WHEREAS, Gill Brothers Funeral Chapels, Inc,, a Minnesota corporation ("Owner") is the owner of the property in the County of Hennepin and State of Minnesota described on Exhibit 1 attached hereto and made a part hereof ("Property"); and WHEREAS, the Property is subject to the provisions of a certain Redevelopment Agreement (the "Agreement") dated , 1995 by and between Owner and the Economic Development Authority in and for the City of New Hope, Minnesota (the"EDA"); and WHEREAs, Owner has fully and duly performed all of the covenants and conditions of Owner under the Agreement with respect to the completion of the Project (as defined in the Agreement); NOW, THEREFORE, it is hereby certified that all requirements of Owner under the Agreement with respect to the completion of the Project have been completed and duly and fully performed, and this instrument is to be conclusive evidence of the satisfactory termination of the covenants and conditions of the Agreement as they relate to the completion of the Project, All other covenants and conditions of the Agreement shall remain in effect and are not terminated hereby. Dated this day of , 1995. ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF NEW HOPE, MINNESOTA By: Its President By' Its Executive Director A-1 STATE OF MTNNESOTA ) ) SS COUNTY OF HENNEPIN ) The foregoing instrument was acknowledged before me this day of , 1995 by Edward J. Erickson, President, and Daniel J. Donahue, Executive Director, of the Economic Development in and for the City of New Hope, Minnesota. Notary Public This Instrument Was Drafted By: CORRICK & SONDRALL, P,A. 8525 Edinbrook Crossing, Suite 203 Brooklyn Park, MN 55443 A-2 EXHIBIT B COVENANTS AND RESTRICTIONS 1. The Property shall not be exempt from real estate taxes notwithstanding the ownership or use of the Land. 2. The Property shall not be sold, transferred, conveyed or leased to any of the following parties: (a) An institution of purely public charity; (b) A church or ancillary tax exempt housing; (c) A public hospital; (d) A public school district; (e) An organization exempt from federal income taxes pursuant to Section 501(c)(3) of the Internal Revenue Code of 1986, as amended; or (f) A Minnesota cooperative association organized under Minnesota Statutes, Section 308.05 and 308.18 for the purpose of complying with the provisions of Minnesota Statutes, Section 273.133,.subdivision 3, or any other' party that would cause the Property to be valued and assessed for real estate tax purposes at a lower percentage of its market value than the Property is then being valued and assessed for real estate tax purposes or would result in the Property becoming exempt from real estate taxes. 3. The land shall not be used for any of the following purposes: (a) The operation of a public charity; (b) A church or house of worship; (c) The operation of a public hospital; (d) The operation of a public schoolhouse, academy, college, university, or seminary of learning; or B-1 (e) Any other use which would cause the Property to be valued and assessed for real estate tax purposes at a lower percentage of its market value than the Property is then being valued and assessed for real estate tax purposes or would result in the Property becoming exempt from real estate taxes. 4. The covenants and restrictions herein contained shall run with the title to the Property and shall be binding upon all present and future owners and occupants of the Property; provided, however, that the covenants and restrictions herein contained shall inure only to the benefit of the Economic Development Authority in and for the City of New Hope, Minnesota ("EDA"), and may be released or waived in whole or in part at any time, and from time to time, by the sole act of the EDA, and variances may be granted to the covenants and restrictions herein contained by the sole act of the EDA. These covenants and restrictions shall be enforceable only by the EDA, and only the EDA shall have the right to sue for and obtain an injunction, prohibitive or mandatory, to prevent the breach of the covenants and restrictions herein contained, or to enforce the performance or observance thereof. 5. The covenants and restrictions herein contained shall remain in effect until , 2025 and thereafter shall be null and void. B-2 EXHIB1T C FORM OF BOND UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF NEW HOPE LIMITED REVENUE TAXABLE TAX INCREMENT BOND (GILL BROTHERS FUNERAL CHAPELS, INC.) $387,806 THE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF NEW HOPE, Hennepin County, Minnesota (the "EDA"), acknowledges itself to be indebted and, for value received, hereby promises to pay to Gill Brothers Funeral Chapels, Inc., a Minnesota corporation (the "Redeveloper"), the principal amount specified above, together with interest thereon at the rate of % per annum, with such interest to accrue from the date of issuance by the EDA of the Certificate of Complet ion, as defined in the Redevelopment Agreement (the "Certificate of Completion"), pursuant to Section 4.3 of the Redevelopment Agreement dated (the "Redevelopment Agreement") between the EDA and the Redeveloper. Interest accruing from the date of issuance of the Certificate of Completion and not paid on any 1 or 1 thereafter shall be added to the principal amount of the Bond on such date. The interest hereon and the principal hereof, are payable in lawful money of the United States of America, by check or draft of the EDA mailed to the Redeveloper at the address specified by the Redeveloper, on the dates and in the amounts hereafter specified. This Bond is issued pursuant to a resolution adopted by the Board of Commissioners on (the "Resolution") to reimburse the Redeveloper for the payment of the capital cOsts of a redevelopment project to be undertaken in Tax Increment Financing District 85-2 (the "District") of the EDA and is issued pursuant to and in full conformity with the provisions of the Constitution and laws of the State of MinnesOta thereunto enabling, including Minnesota Statutes, Section 469.041, Section 469.178 and Chapter 475. This Bond is payable' solely from tax increments to be derived from the District (the "Tax Increment") which have been pledged to the payment of this Bond by the Resolution. C-1 On each 1 and 1 through and including 1, 2006, following the date of issuance of the Certificate of Completion, the EDA will apply all Available Tax Increment, as hereinafter defined to payment of this Bond. All such payments shall be applied first to accrued interest and then to the principal amount of this Bond. No further amounts shall be due and owing on this Bond after , 2006, notwithstanding that the full principal amount of this Bond and accrued interest shall not have been paid on such date, and any principal and interest remaining unpaid as of such date shall be considered forgiven by the Redeveloper. "Available Tax Increment" is defined as all Tax Increment then on hand with the EDA following the reimbursement to the City and EOA of up to $2,500 in any calendar year for out-of-pocket administrative expenses paid or incurred by the EDA or City in connection with the approval, establishment and administration of Redevelopment Plan for Redevelopment Project No. 85-2 of the EDA and the Tax Increment Financing Plan for the District or related to the Bond. In the event that Available Tax Increment is not sufficient to pay the principal of and interest on this Bond when due, the failure of the EDA to pay such principal and interest shall not constitute a default hereunder. This Bond and the interest hereon shall not be deemed to constitute a general obligation of the State of Minnesota or any political subdivision thereof, including, without limitation, the City or the EDA. Neither the State of Minnesota, nor any political subdivision thereof, including, without limitation, the City or the EDA, shall be obligated to pay the principal or interest on this Bond or other costs incident hereto except from Tax Increment pledged therefor by the Resolution, and neither the full faith and credit nor the taxing power of the State of Minnesota or any political subdivision thereof, including, without limitation, the City or the EDA, is pledged to the payment of the principal of or interest on this Bond or other costs incident hereto. NEITHER THE EDA OR THE CITY MAKES ANY REPRESENTATION OR WARRANTY THAT THE AVAILABLE TAX INCREMENT WILL BE SUFFICIENT TO PAY THE PRINCIPAL OR INTEREST ON THIS BOND WHEN DUE. All interest hereon shall be computed on the basis of a 360 day year consisting of twelve thirty day. months. The principal amount of this Bond may be prepaid, either in whole or in part, on any date upon payment of the price equal to the principal being so prepaid plus accrued interest to the date of prepayment without premium. Any such prepayment shall be applied first to accrued interest and then to principal. C-2 THIS BOND MAY NOT BE TRANSFERRED OR ASSIGNED, [N WHOLE OR [N PART, BY THE REDEVELOPER WITHOUT THE PRIOR WRITTEN CONSENT OF THE EDA; PROVIDED THAT THE REDEVELOPER MAY PLEDGE THIS BOND AND THE PAYMENTS HEREUNDER TO A LENDER FOR THE PROJECT, AS DEFINED [N THE REDEVELOPMENT AGREEMENT, IF PR[OR WRITTEN NOTICE OF SUCH ASSIGNMENT IS GIVEN TO THE EDA AND THE LENDER DELIVERS TO THE EDA AN INSTRUMENT EXECUTED BY SUCH LENDER ACKNOWLEDGED THAT [T HAS REVIEWED THE TERMS OF THE BOND, THAT IT HAS SUFFICIENT KNOWLEDGE AND EXPERIENCE TO EVALUATE THE ABILITY OF PAYMENTS TO BE MADE BY THE EDA UNDER THIS BOND, THAT [T HAS ALL FINANCIAL AND OTHER INFORMATION [T HAS REQUESTED REGARDING .THE DISTRICT AND THE TAX INCREMENT, THAT THE BOND [S PAYABLE SOLELY FROM AVAILABLE TAX INCREMENT AS PROVIDED HEREIN AND THAT THE EDA IS NOT MAKING ANY REPRESENTATIONS AND WARRANTIES AS TO THE SUFFICIENCY OF AVAILABLE TAX INCREMENT TO PAY THE BOND. [T [S HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts, conditions and things required by the Constitution and laws of the State of Minnesota to be done, to exist, to happen and to be performed precedent to and in the issuance of this Bond in order to make it a valid and binding limited obligation of the EDA according to its terms have been done, do exist, have happened and have been performed in regular and due form as so required. IN WITNESS WHEREOF, the Economic Development Authority in and for the City of New Hope, Hennepin County, State of Minnesota, by its Board of Commissioners, has caused this Bond to be executed by the signatures of its President and Executive Director and has caused this Bond to be dated as of the date set forth below. Dated: President Executive Director C-3 c:\ w p51\cnh\ gil3.ra 1995 REGULAR SESSION Ch. 224, § 61 of Federal Regulations, title 24, part 92.2, is deemed to meet the board membership requirements of this subdivision. (f) The corporation shall not discriminate against any persons on the basis of a status protected under chapter 363. (g) The corporation shall demonstrate that it has or can obtain the technical skills to analyze projects, that it is familiar ~th available public and private funding sources and economic development, redevelopment, and housing programs, and that it is capable of packaging economic development, redevelopment, and housing projects. (h) The corporation must have completed ~wo or more economic development, redevelop- ment, or housing projects within its designated community during the last three Sec. 58. 11{;.1.991 PUBLIC ASSISTANCE TO BUSINESS; WAGE AND JOB RE- QUIREMENTS. A business that receives state or local government assistance for economic development or 'ok~.~.owth purposes must create a net increase in jobs in Minnesota within two years of re__ce~qng the assistance. The government agency providing the assistance must establish wage level and job creation ~o~s to be met by the business receiving the assistance, g.~_h,!~i~ t.ha;.fail.a .t~_meet the ~als must rejmy the assistance to the government agency. ~ach government agency must report the wage and job goals and the' results for each l~ject in achieving those goals to the department of trade and economic development. The d~partment shall compile and publish the results of the reports for the previous calendar year ~ June 1 of each year. The reports of the agencies to the department and the compilation ~port of the department shall be made available to the pubhc. For the purpose of this section~ "assistance" means a grant or loan in excess of $25,000 or t~x increment financing. Sec. 59~ Minnesota Statutes 1994, section 116M.16, subdivision 2, is amended to Subd. 2. GIFTS; GRANTS; APPROPRIATION. The board may apply for, accept, and ~sburse gifts, grants, loans, or other property from the United States, the state, private foundations, or any other source. It may enter into an agreement required for the gifts, ~ts, or loans and may hold, use, and dispose of its assets in accordance with the terms of ~ gift, grant, loan, or agreement. Money received by the board under this subdivision must I~ deposited in a separate account in the state treasury and invested by the state board of ~ent. The amount deposited, including investment earnipgs, is appropriated to the lmrd to Carry out its duties. 8e¢. 60. Minnesota Statutes 1994, sec}ipq .116M.18, subdivision 4, is amended to read: .8ubd. 4. BUSINESS LOAN CRITERIA. (a) The criteria in this subdivision apply to ~ made under the urban challenge grant program. · (h) Loans must be made to businesses that are not likely to undertake a project for which :are sought without assistance from the urban challenge grant program. A loan must be used for a project designed to benefit persons in low-income areas the creation of job or business opportunities for them. Priority must a!se for loans to the lowest income areas. The minimum loan is $5,000 and the mazdmum is $150,000. loan must be matched by at least an equal amount of new private investment. .~ A loan may not be used for a retail development project. business must agree to work with job referral networks that focus on minority from Iow-income areas. Minnesota Statutes 1994, section 116M.18, is amended by adding a subdivision to Additions are indicated hy underline; deletions by .~tr!ke~,-! 1123 DORSEY 8x: WHITNEY PROFESSIONAL LI.~tITED LIABILITY P~RTNERSHIP WASHINGTON, D.C. 220 SOUTH SIXTH STREET EINNEAPOLIS, ~INNESOTA 55402-1498 ROCHESTER, HN DENVER (6la) a40'~600 BILLINGS ORANGE COUNTY, CA FAX (611) 340-a868 GREAT FALLS LONDON HISSOULA F~O August 11, 1995 Mr. Daniel Donahue City Manager City of New Hope 4401 Xylon Avenue North New Hope, MN 55428 Dear Mr. Donahue: You have advised me that the City of New Hope owns certain property located on 42nd Avenue North in the City that it is negotiating to sell to Gill Brothers Funeral Homes. Gill Brothers is proposing to construct a new funeral home on the site. The site is located in the 42nd & Winnetka Redevelopment Area and Tax Increment Financing District of the New Hope EDA, and it is anticipated that Gill Brothers will request that the New Hope EDA provide tax increment financing assistance in connection with its development of the site. You have asked what expenditures with respect to development of the site are eligible to be paid from tax increment revenue. The typical types of expenditures eligible for tax increment financing assistance in connection with the development of commercial property are land acquisition costs, costs relating to construction or relocation of public utilities and public streets and sidewalks, public charges required to be paid with respect to the development of the site such as permit fees and SAC and WAC, and site development costs for such items as grading, soil correction work and landscaping. In addition any costs relating to removal of remediation of any pollution on the site is an eligible expenditure of tax increment revenue. These eligible costs are commonly referred to as public redevelopment costs. In the past the New Hope EDA has established interest reduction programs and used tax inCrement revenue to write down interest on the developer loans which financed multifamily housing developments. Only low and moderate income housing developments are eligible for interest reduction programs, so that DORSE¥ & WHITNEY Page -2- Mr. Daniel Donahue August 10, 1995 type of assistance is not available for the development of the site by the Gill Brothers. Should the New Hope EDA determine'to provide some tax incremerit financing assistance to the development there are a number of ways in which the assistance can be structured. One structure would be for eligible costs to be paid directly by the EDA or reimbursed to the developer as paid. If this s~ucture is used, the EDA will need security from the developer to ensure the development of the site is completed. A second structure would be for the EDA to reimburse the developer for certain eligible costs paid by the developer upon completion of construction. In this manner the EDA's money is not at risk if the construction is not completed. A third structure would be for the EDA to agree to reimburse the developer for eligible costs from the tax increment as it is received from the developed property. In this case the eligible costs would be paid by the developer, and the developer would not be reimbursed for such costs for a number of years and then only to the extent tax increment from the development is sufficient. This is commonly referred to as "pay as you go" financing and has been frequently utilized by cities in recent years. Should you have any further questions concerning this matter, please give me a call. Yours truly, , cc: Steve Sondrall GILL BROTHERS FUNERAL CASH PROJECTION TAX INCREMENT FINANCING ESTIMATED TAXABLE MARKET VALUE. 1,000,000 YEAR YEAR YEAR YEAR YEAR YEAR YEAR YEAR YEAR YEAR 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 ESTIMATED TAXABLE MARKET VALUE 1,000,000 1,020,000 1,040,400 1,061,208 1,082,432 1,104,081 1',126,162 1,148,686 1,171,659 1,195,093 ESTIMATED FROZEN VALUE 422,300 422,300 422,300 422,300 422,300 422,300 422,300 422,300 422,300 422,300 INCREMENT VALUE 577,700 597,700 618,100 638,908 660,132 681,781 703,862 726,386 749,359 772,793 TOTAL TAX CAPACITY 44,400 45,320 46,258 47,216 48,192 49,188 50,203 51,240 52,296 53,374 FROZEN TAX CAPACITY 17,826 17,826 17,826 17,826 17,826 17,826 17,826 17,826 17,826 17,826 INCREMENT TAX CAPACITY 26,574 27,494 28,433 29,390 30,366 31,362 32,378 33,414 34,471 35,548 INCREMENT TAXES BASED ON 1995 TAX RATE $35,721 $36,958 $38,219 $39,506 $40,818 $42,157 $43,522 $44,915 $46,336 $47,785 EDA f,,~(k q)~,] REQUF~T FOR ACTION Originating Department Approved for Agenda Agenda Section City Manager EDA --25-95 Sarah Bellefuil Item No. By:Administrative Analyst By:fi// 7 MOTION APPROVING A REQUEST ~:/OR PROPOSALS FOR SPECIAL NEEDS RENTAL HOUSING In 1993, the CO-OP Northwest Community Revitalization Corporation, a non-profit Community Housing Development Organization (CHDO), was established to provide affordable housing to low and moderate income residents of Brooklyn Park, Brooklyn Center, Crystal, New Hope, and Robbinsdale. Because of the establishment of CO-OP Northwest, the five cities have received Federal HOME Investment Partnerships Program funds which the cities can use toward their affordable housing goals. One example of a project in New Hope that used HOME funds was the construction of the handicap accessible twin home at 51st and Winnetka. HOME funds will also be used for the accessible twin home to be built at 6073 Louisiana Avenue North. New Hope has also recently received $90,000 in HOME funds for year 1996. These funds have been designated for special needs rental housing. Specifically, a blighted four or six unit apartment ho~ase would be purchased and rehabilitated for low-income developmentally disabled, physically disabled, or mentally ill persons or households and would include on-site support services to those individuals. The City's commitment to the project would be 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. Attached is a request for proposals drafted by CO-OP Northwest which would be sent out to an organization (or organizations that submit a proposal jointly) that could own and manage the facility. If a proposal is submitted and approved, staff would oversee the project preparation, development, renovation specifications and rehabilitation process. The City would not own the property but would only provide financing and staff services to an organization(s) that would purchase and manage the site. Staff does not have a specific site in mind at this time but has looked at several sites in the community to determine if they would be adequate for this type of project. Sites that will be targeted for the project are apartment units that are in need of substantial rehabilitation. Staff requests approval of a motion approving the request for proposals for special needs rental housing in the City of New Hope. / TO: ~~YT~~-- Review: Administration: Finance: RFA-O01 ~ (9/20/95) REQU EST FOR PROPOSALS To Own and Manage Special Needs Rental Housing and Provide SupPortive Services as Necessary The CO-OP Northwest Community Revitalization Corporation, a non-profit provider of affordable housing, and the City of New Hope are soliciting proposals fi-om organizations seeking to own and manage an affordable multi-unit rental housing facility for low-income developmentally disabled, physically disabled or mentally ill persons or households and provide appropriate supportive services. Background The CO-OP Northwest Community Revitalization Corporation is a non-profit 501 (c)(3) Community Housing Development Organization (CHI)O) with a mission of providing affordable housing to low- and moderate-income residents of Brooklyn Center, Brooklyn Park, Crystal, New Hope and Robbinsdale. Additional goals of the organization are to stabilize neighborhoods and maintain the existing housing stock through working closely with participating cities. The Corporation was formed in 1993 and its activities are supported by the five cities and Northwest Hennepin Human Services Council. The Corporation has recently contracted with Project for Pride in Living (PPL) to provide housing development assistance. The City of New Hope has extensive experience in housing development and in providing affordable housing opportunities for low- and moderate-income persons. Past and present projects include: a scattered site housing acquisition and rehab program to create affordable homeownership opportunities for low and moderate households; scattered site housing rehab loans for low and moderate income homeowners to maintain their homes; a Section 8 rental assistance program; construction of barrier free affordable rental housing foi' people with physical disabilities; and, construction of affordable barrier free owner-occupied housing for persons with disabilities. Program Description The CO-OP Northwest Community Revitalization Corporation and the City of New Hope have entered into a partnership to renovate a multi-unit housing facility in New Hope for use as long- term affordable rental housing for low-income developmentally disabled, physically disabled or mentally ill persons. An organization (or organizations submitting a proposal jointly) will be selected through this RFP process to own and manage the housing and place staff on-site to provide appropriate support services. The Cky of New Hope has committed Economic Development Authority (EDA) funds and the CO-OP Northwest Community Revitalization Corporation has committed Federal HOME funds towards acquisition and renovation costs. The owner/provider selected through this RFP process would acquire the property' The City has identified several properties as potential project sites containing between 4 and 8 units. The owner/provider will identify the needs of the population being served and work directly with the CO-OP Northwest Community Revitalization Corporation and the City of New Hope to identify the site and rehab needs appropriate to the special needs population. The New Hope Community Development Department will contribute staff time to oversee the project preparation, development, renovation specifications and the rehab process. The capital financial assistance provided by the City and the CHDO would enable the owner/provider to maintain the property as permanent, safe housing for persons/households in one of the three designated special needs population groups with incomes at or below 50% of the Metro area median income. The housing facility would be combined with a range of appropriate supportive services to enable the residents to live successfully in the community. There would be legal agreements with cross-guarantees between the CO-OP Northwest Community Revitalization Corporation, the City of New Hope, and the owner/service provider to guarantee a satisfactory quality of operation and supervision in the housing facility. Form of Financial Assistance The City of New Hope has committed $90,000 in Economic Development Authority (EDA) funds, and the CO-OP Northwest Community Revitalization Corporation has committed $90,000 in Federal HOME funds, to help cover acquisition and renovation costs. Both sources of financing will be allocated in the form of loans to the owner/provider selected through this RFP process. The City financing would be secured through a $90,000 first mortgage on the property at 0% interest. Full repayment of the $90,000 first mortgage is expected. The CHDO would have the second mortgage on the property also at 0% interest. Repayment of the second mortgage is also required. Repayment schedules for the first and second mortgages would be negotiated upon selection of the owner/provider. Goals The goals of the project are as follows: 1) Rehabilitate a 4-8 unit multi-family housing facility to increase the supply of housing for persons/families with: a. Physical disabilities; b. Developmental disabilities; or c. Mental illness. 2) Establish and maintain long-term ( 10-20 years) affordable housing available to persons/families at or below 50% of the Metro area median income in one of the three special needs listed above 3) Maintain and improve the existing housing stock in the City of New Hope and surrounding cities in Northwest Hennepin County. Criteria for Selection: Stronger consideration will be given to those proposals that: 1. Demonstrate an understanding of Sound budgetary practices in managing affordable multi-family housing as demonstrated through the pro forma budget submitted by the applicant. 2. Include appropriate supportive services for the target population being served which help to integrate that population into the broader community. 3. Demonstrate the financial ability to provide supportive services for the identified low- income special needs population for at least 10 years. 4. Adequately meet the affordability needs of the target population as demonstrated in the budget submitted by the applicant. 5. Demonstrate a proven track record of providing decent, safe long-term affordable housing. 6. Provide quality affordable housing opportunities for low income special needs residents of New Hope, Brooklyn Center, Brooklyn Park, Crystal and Robbinsdale. Eligible Applicants Non-profit or for profit housing and/or supportive service providers. Proposals submitted jointly by housing providers and supportive service providers will be accepted. Pro~ram Requirements Applicants must comply with all requirements of the HOME Investment Partnerships Program (HOME). Any additional financing or subsidies proposed by applicants must also be in accordance with Federal HOME requirements. The federal regulations governing the HOME program can be obtained by contacting Dave Greeman, at Northwest Hennepin Human Services Council, at 493-2802. Applicants must be committed to operating the multi-family housing facility as affordable housing for a designated special needs population for no less than 10 years. The selected owner/provider must be willing to market rental units in accordance with the Affirmative Marketing Plan adopted by the CO-OP Northwest Community Revitalization Corporation which includes, but is not limited to, compliance with Federal Fair Housing laws. The selected owner/provider must locate staff on-site at the housing facility to provide necessary supportive services and any required supervision. Selection Process and Funding Commitment Projects will be selected based upon the established goals and priorities. A selection committee consisting of representatives of the CO-OP Northwest Community Revitalization Corporation and the City of New Hope will make a recommendation to the CO-OP Northwest Community Revitalization Corporation Board of Directors and the Ne~V Hope Economic Development Authority. The initial funding commitment will serve as a preliminary commitment. A final commitment will be made at the point a contractual agreement has been executed. The Hennepin County Housing Consortium will review the contractual agreement prior to its execution to verify that the agreement is consistent with HOME requirements and those established by Hennepin County. The CO-OP Northwest Community Revitalization Corporation and the City of New Hope reserve the fight to reject all funding requests and rescind this request for proposals. Deadlines for Proposals All proposals must be submitted by 4:30 p.m., December 15, 1995. Mail or deliver proposals to: Northwest Hennepin Human Services Council, 7601 Kentucky Avenue North, Brooklyn Park, MN 55428. Direct any questions to David Greeman at Northwest Hennepin Human Services Council at 493-2802. PROPOSAL CONTENTS I. Narrative Items A through E should be addressed in the Narrative section. The Narrative section is limited to 5 pages. A. Housing Plan 1) Provide a brief description of the plan for owning and operating the housing facility as long-term affordable housing and providing appropriate support services for residents. In responding to this item, identify the special needs population for which the housing would be provided. 4 2) Describe any' unique features of the proposal. B. Experience and Capacity of the Applicant 1) Describe the extent and length of experience of the applicant(s) in owning and managing similar housing activities. 2) Provide a list of projects which the applicant has proposed, completed and/or managed. 3) Describe the length of experience the applicant has in working with and/or providing services to the targeted population. 4) Explain how the applicant will maintain the proposed level of support services. 5) Describe the applicant staff levels and expertise to implement the activity. 7) Describe the financial capacity of the applicant to undertake the activity. C. Affordability 1) Describe the extent to which the proposed activity provides long-term affordable housing and how it will be accomplished. 2) Describe how the project provides affordable housing and the anticipated income range of residents. D. Evidence of Need 1) Demonstrate the need for the proposed housing and suPport services for the targeted special needs population. E. Supportive Services 1) Describe supportive services which are an integral part of the proposed activity and why the services are appropriate for the residents. 2) Describe how the services will be provided for the residents and financed. H. Budget 1) Provide a detailed operating budget, using the pro forma budget attached. Include yearly expenses related to operating and maintaining the property as affordable 5 housing and providing appropriate supportive services. Also provide information on yearly revenue sources including rents and other sources including reimbursement for the provision of resident services if applicable. Please also list debt service and cash flow to indicate the proposed schedule for repaying the mortgages held by the City and the CHDO. The repayment schedule for the first and second mortgages will be negotiated upon the selection of an owner/provider. For the purpose of completing the pro forma budget, assume that the property will be a fourplex with a $l t0,000 purchase price and $70,000 in rehab and conversion costs. Also assume a 3% annual increase in expenses and revenues. (Note: Applicants should not assume that this will be the actual scenario for the project selected.) 2) Provide information on the proposed repayment schedule for the first and second mortgages. IH. Community and Constituency Support 1) Letters of support may be attached as appendices to the application. nwhhsc/chdo/newhope/specneed, rfp 6 SPECIAL NEEDS RENTAL HOUSING PRO FORM~ YR! YR2 ¥R3 YR4 YR5 YR6 YR? YR8 ¥R9 YR10 Income Gross Rent Income Parking Income Laundry Income Other Sources Specify: Total Gross Income Vacancy @ 7% Effective Income Expenses Operating Expenses Real Estate Taxes Support Services Total Expenses .. Net Operating Income Debt Service Cash Flow nwhhsc/chdo/newhope/specneed.bud 612-523-4823 ,~u~I/c Works .=ax: ~ ~:-:,,,:- ::~, 612-531.5109 Fire Oep't. Fax: 61£.55~-$175 March 8, 1995 Ms. Barbara Hayden, Planning Supervisor Hennepin County Office of Planning & Development 10709 Wayzata Boulevard, Suite 260 Minnetonka, MN 55305 Subject: 1995 Hennepin Housing Consortium Home Investment Partnership Program Dear Barb: The City of New Hope is in agreement with and supportive of the proposal by the CO-OP Northwest Community Revitalization Corporation to acquire and rehabilitate a four-plex unit at 7302-7316 Bass Lake Road or another appropriate site for transitional housing purposes. The City has reviewed the proposal prepared by the Director of the CO-OP Northwest Community Revitalization Corporation and understands the cost associated with the acquisition and redevelopment. New Hope is committed to contributing $90,000 for this project for acquisition, legal, closing, relocation, and other necessary expenses. It is understood that once the property is rehabilitated that it would be owned by the CRC and would be leased to a transitional housing service provider. We believe that this project meets the priorities of the Hennepin Housing Consortium for the HOME Program activities because it would provide affordable housing on a long-term basis for persons with special needs. Please contact me if you have any questions, and thanks for your consideration of our proposal. Sincerely, City Manager DJD/prs Family Styled City ~ For Family Living