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2000-08-03[] ~E~IS~~ SPECIAL MEETING OF THE MOUND HOUSING AND REDEVELOPMENT AUTHORITY 2020 COMMERCE BOULEVARD MOUND, MINNESOTA 55364 DATE: AUGUST 3, 1999, 7:30 P.M. LOCATION: COUNCIL CHAMBERS, MOUND CITY HALL ROLL CALL: MEETING AGENDA: ~ )~I ~~~ 1. PRESENTATION O PRELIMINARY DEVELOP `J" ~ ~~ Yn U AGREEMENT ITH COAST TO COAST. ..,~.. ~-,,~- der. TAX INCREMENT POLICY: 3~ QUALIFYING SCHOOL DISTRICT SITE FOR AX ~, INCREMENT TREATMENT. ~~,d;.C ~' ~ ~'' RECOMN~NDATION FOR THE PREPARATION OF A No ~'~~~'-~'"` FORMAL PURCHASE AGREEMENT FOR VACANT PROPERTY ON SHORELINE DRIVE (NEXT TO SUPE j~'~ d" `"`"'~Q AMERICA, PID #113-117-24 34 0063 &0075} 4,~~ FROM CK DEVELOPMENT CO./ BALBOA LIMITED `"`"Y /~.-~~ PARTNERSHIP. ~~~ ~ r 5. ADJOURNMENT: w1 9 Creative Solutions for Lend Planning and Design Hoisington Koegler Group Inc. July 29, 1999 Mike Sr. & Michael Jr. Mueller 591U Ridgewood Road and Phil Lansing 1794 Jones Lane Mound, MN 55364 Dear Gentlemen: Enclosed is a preliminary layout plan of the proposed Coast to Coast building in Mound. As you can see, the building would be moved as close to the railroad tracks as possible in order to maximize a development site to the north. The drawing indicates approximately 35 feet of city- owned property north of the building, which could be combined with your parcel for future development. The actual placement of the building could shift somewhat if any easements or unforeseen circumstances arise through the survey process currently underway or through negotiations with the County. The preliminary alignment of County Road 15 and the addition of a parking bay on County Road 110 will encroach on the west and north sides of your property. The City will want to retain a generous sidewalk corridor along l 10 (between 10 and 14 feet) so any building would follow the approximate westerly alignment of Coast to Coast. An issue we will soon address with Hennepin County is whether they will be pushing for additional 110right-of way width as part of downtown redevelopment. This could obviously impact your property somewhat further. We will know about the timing of County Road 15 realignment by around mid August and the survey work should be done in the same timefrarne. ff you have any questions, please give me a call. The Ciry Council will review a preliminary development agreement with Coast to Coast at their August 10 tr~eeting. The agreement will use the enclosed sketch as a guide for building placement. I look forward to talking with you in the near future about you thought on redevelopment. Sincerely, ? ~~ Bruce Chamberlain Mound Visions Coordinator cc: Fran Clark, Acting City Manager Enc. \VYKQ~vOL2VKOtJND't99-2~1Ctx_lay,Qoc 123 North Third Street, Suite 100, Minacapolis, Iii 55401-1659 Ph (612) 338-0800 Fx (612) 338-6838 90 ~ 0i 66 ~ 0~ ~flt Z 0d LZL ~13~930~1 NOlJN I S I OH 8~098~£-Z T 9 1 1 1 ,~ ~ "--f '~ ~~T t~ ~ ° w • Lea ~..~--_ ~c~s _--~' c , _--~ ~~~ . ~~ ~~~~~ ~ - - - _ ---- ~E~u~ ~ ~bJs~ ~~~ . i Z I l - ov -- r ^_ '1 ~~ 19' c~ ~ o-~ ~~~ 1 ~~ `~~ ~~ ~~ r ~^~~ r Gtn ~ ~`10~ ~~. ~~ ~~ ~`' --* r 90~0t 66~ 0~ ~nr z0d LZL ~3~930~1 N019NISIOM 8~898~£-zt9 ~~~ ~~ 1 EVERGREEN LAND SERVICES CO. 6110 BLUE CIRCLE DRIVE, SUITE 140 MINNETONKA, MN 55343 (612) 930-3100 • Fax (612) 935-0862 Watts (888) 411-1134 July 23, 1999 CK development Co./Balboa Center Limited Partnership 4600 Westbury Drive Colleyville, TX 76034 Attn: Gary Maxwell Re: City of Mound, Mn. 5377 & 54XX Shoreline Drive P. I. D. Number 13-117-24-34-0063 & 0075 Dear Mr. Maxwell: The undersigned represents the City of Mound and the Mound Housing and Redevelopment Authority ("Authority") in connection with the negotiation and acquisition of properties in the downtown area of Mound, Minnesota. In that capacity, I have reviewed the possibility of acquisition of the referenced site by the Authority and it is my intention to recommend to the Authority that it submit a purchase offer in the form of a purchase agreement. I will be recommending to the Authority that the purchase agreement contain a purchase price of $500,000.00, all of which would be payable at closing, and that the purchase would be contingent on marketable title, satisfactory environmental and soils review. Closing would occur, under my recommendation, once those matters have been satisfied or waived. A closing this Fall would seem likely. The purchase agreement would also contain other provisions customary in transactions of this nature. Although the decision to make any offer rests exclusively with the Authority's governing body, it is my belief that the Authority will approve my recommendation. I would like to have the Authority consider this matter at a meeting on August 3, 1999. If approved, the Authority would direct the preparation of a formal purchase agreement which it would then consider on or before August 10, 1999. Successfully serving ou cr ~1ents since 1972 However, before proceeding, it is important to know whether the property is still available, and if so, whether the terms outlined above would be considered by your organization. It would be appreciated if you could provide me with that information by Tuesday, July 27, 1999. Thank you in advance for your time and consideration of this matter. Stuart "Bud" Storm, SR/WA President ECG'. 'f~~t,~~~ C~~a1~2ta~~ n~ ~ ~-~ ~.JC+~~1 ~~ ~ t L',VL'fCIrIYL'l1iY Lt11VJC.t(V1~CJ f't711 IYV. ~JUUUUL C R DEYQ,OPMbNT Cdi~AJVY 4600 WFS'r7BLTRY D]i]VE COY,LEY'VB,I,E, TEXAS 76034 ruly ~, 1999 Mr. Stuart Storm Pt~sideat 8vbrpraen Land Setvioea Campmry 6110 Blue Circle Dries suite 140 Mtnnetcudc~ Mmnasota 5S3d3 Mr. Storm: I am irr receipt of your correspondence b me dated ]ttly 23, 1999 is which yvlt indicate pvu are reoommerdirrg die saquteitian of our property on ShorelisAe Drive to the Crtq of lkioaod. You fiuther asked for a response by T~s~dtty July 27. I999 to your lector of interest, I first watts to tltenk you for your letter. I have heard before in rwrnerous convetsarioas with the previous City Manager sad otheta of the City's interest in our land, 1 Baoldy had given vp hops and as you terow haw been t»arketirrg ttu prppCrty for sale. We have been gpofing 59.00 per square foot; a number supported by the several 5hareline Drive comparable sales including the ptarchaso ofthe POSt Oflicv in Moiatd. Taman officer of the genera] Partner but hates martyr limited parhQers ire this deal and doubt that I wiU be able to spank id them aU on such short notice, What I can dv ag the Lateral Partner is to give you aasuraooe that I will oot act on the conrpotirtg offer that ! have for the property until aRer August 3,1999 bo sallow the Ciry / Authority time to meet and act oa yew recommendation. I can t5rrtlser teest in say cal7aeitY as a partner (not ac the General I'artrrer) by saying that the offer would be acceptable to me iP it is considered a net offer. By thatl r:tean that the City/Autharily wjU obtain arty teats or repon5 at its ow,1 cos4~ ,and tip Shcer win not be eapeeoed to pay attp~ sisailicant closing costs. I would flucha expect a reasonable tirnefhmte Cbr the transaction 9o as not to tie up the property for as etctatded period sf time. ?here is om additional item stay be of benefit m my partzteh that dose not involve soy monetary eansiderarioa As I understand it, the tact laws are quite beatd'icial to sellers who salt under fire threat o~'coadenmation. i do not baiievs that conderrutuion bas to talcs plats: but merely Ebr the City to thrraten to do so tf ttegvtiations are unsuccessful. I would sale that yv,r ooroJder this a: possible enl-atlcetrtent to yoga oi~'er, if you wish to discuss mY reaporse please call me ar (817) 788~67I. Please lot the hear from you after the August 3,1993 meeting, 5incerey, ~ N, Maxweu Vita-President C K DeveJopttteat Coa><tady (3er1eaal Partner Balboa Center Littribod Parptership I ~ UL ~~,~~ _, . - OT-1T-99 11:13 From-KENNEDY i GRAVEN 1 } :; ., , '' 1 • r 1 i July 26. i ; 9 E .i bat. St~ta3t ' ~ t~ pre6ideot ~ ~ $etvicac Cornpeny 6110 8ltu :~' Dviva suite l40 >Ii~utcoonl ~; SS343 ~ ~. Aar. Storm .. +6113379310 C K 17i8NbLOpbaSNT C'OI~@ANY /b00 WSS'ZBUYYDRIVti CAS .T.$ 7331CA3 76034 7-081 P.03/03 F-196 SNFo } I sat in ra : ~t t roar eassatpo~ ~ me daecd Idy 24,1999 in wiaich yet: ~ssatcam Yav era teoterstaetading ~°'~~ ';° ear p~De~Y on 8boretiw t?pvs to the ~ of 14ound Yar 5adtes es8ed tnr a re~tponse by 15seeday J ~ ~ 2 1499 ro ~rour letter of iateresY I first isreD ; ~ !h yetr fa- yeia looter. I6ave board bata« is ataavow~ oouversgpcaa faith the previous ~ ~~•~ E ~ of try City'c interest is our read I trod ~veq vp Laptr end as you know hsvs been ~>~g ~ ~rocey lief sale. Wa Lave boon quonag i9.D0 pa e4~ filet a atunhst euppotted by she jai ;1~ sale iactadiag the ~r~e of the Pots Office m A6atmd I ems a4 DE ~ Orvs~al Palmer bra issue tts~y Gudted paratare is zisir deal and daalx riser i will be atik to speak to tt ,i al as s~ ah~ort aotie,~ whac I caa do sc t1w Gennrsi Ptffmtr b tv ~v~a you aactamrea tb=t l wi11 nut eat w `o 'r~ offer that I ilava rat ma pcopergr tail .Aar Axpvst 9,1999 t0 atiow tL+c CaLy / Aatbo[liy time to nne ~ on your tech 1 tea hsih ~ ~ jo my r~pacary « s peraar (cps es ffie (i~orii Former) by caysvp that tlta o~ wottid be eeoeptsblo ~ his to ceneidaged atyec o8'or. 8y thaslmoen met theCity/AuslseriRy elf obram arty testy or sspoest at i ~ roees and vfe Sdier will aor bo ocpocood m pay soy sipri>Scera eieei~ teem. I would ft:rtbar aspen a iz tp rimefraeaa !or the traaeealee m as net m to ~ the propesry let as v+aepdcd ~eciod o<'tame Tlsecb ;e a ~ ~ ~ e1 itwo aw,y be sf bt~ebt to my palmate tit does Dot iavotea any meaeAary eansidetariot. As l tinder the tax taws .-v gore bw,.baiol iQ aoliars .da sdl titldei tlrc thrall of cau0rsmt6tiati I dD Dal bedievn the alien Istttt b tales piece Eta merely !br tLe City to tlaeatea m Jo 9c if ae~otistiaau are uasuocsrsst ~ ; I ask tigat you caatsdar ifris m poeet3la en6ancerrirnt to yer,r ofTW. .~ ~~ ~ ~ ~ ~ R-y ~ P~ t:aD late m (B i~ 78d•669t . PlRae let me hear flora gets after eha Au~istis 3, ,~ ~ :1 ~ t vtcpPreap ~ C K fleveL 1 Coaspeiry Gaoerel Ps ~ Bolbas Car i.Lii~ited Parotetabop i i I ~ voi r ~~A~ ~' FoA ~18CUSSION~ ONl.~' PURCHASE AGREEMENT Mound, Minnesota 199 IN CONSIDERATION OF THE MUTUAL COVENANTS, DUTIES AND OBLIGATIONS CONTAINED HEREIN, the HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MOUND, a Minnesota public body corporate and politic, having its principal place of business at 5341 Maywood Road, Mound Minnesota 55364 ("BUYER"), hereby agrees to the purchase of property situated in the County of Hennepin, State of Minnesota, and legally described in the attached Exhibit A. ("Property")from the undersigned BALBOA CENTER LIMITED PARTNERSHIP„ a Limited Partnership under the laws of the state of having its principal office at 4600 Westburry Drive Colleyville, TX, 76034("SELLER"), said SELLER agreeing to sell such Property to BUYER for the sum of Five Hundred Thousand Dollars ($500,000) which BUYER agrees to pay in the following manner: Payment in full at the time of closing. THE CONDITIONS AND TERMS OF THIS PURCHASE AGREEMENT INCLUDE THE FOLLOWING: 1. DEED/MARKETABLE TITLE: Subject to performance by BUYER, SELLER agrees to execute and deliver at the time of closing a warranty deed conveying marketable title to said Property, subject only to the following exceptions: (a) Building and zoning laws, ordinances, state and federal regulations; 2. POSSESSION-CONDITION SELLER agrees to deliver possession not later than the date of closing. 3. COSTS AND PRO RATIONS: SELLER and BUYER agree to the following pro rations and allocations of costs regarding this Agreement: a. Deed Tax. SELLER shall pay all state deed tax regarding a Warranty Deed and any other documents necessary to place record title in the condition warranted and to be delivered by SELLER under this Agreement. b. Taxes and Assessments. SELLER shall pay all real estate taxes due and payable in the years prior to the year of closing together with all penalties and interest thereon. Real estate taxes due and payable in the year of closing will be prorated as of the date of closing. SELLER shall pay all special assessments due and payable and levied as of the date of closing. BUYER shall pay all special assessments levied on said Property after the date of closing. JBD-166726 1 MU195-2 1 ~RAl~ ~o~- - _ t"yiSCUSSION ONLrI' SELLER makes no representation or warranty whatsoever concerning the amount of real estate taxes or assessments which shall be assessed or levied against the Property subsequent to the date of this Purchase Agreement. c. Recording Costs. SELLER shall pay the costs of recording all documents necessary to place record title in the condition warranted, and those recording costs necessary to place title in the SELLER. The BUYER shall pay the cost of recording all other documents. d. Closing Costs. Each party shall be responsible for its own closing costs. 4. SUBDIVISION OF LAND/LEGAL DESCRIPTION TO PROPERTY: If this sale constitutes or requires a subdivision of land owned by SELLER, SELLER shall pay all subdivision expenses and obtain all necessary governmental approvals. SELLER warrants that the legal description of the real property to be conveyed has been or will be approved for recording as of the date of closing. Both parties understand that all real estate taxes due and payable in the year of closing will need to be paid as stated below at closing in order for a parcel or subdivision or lot split to be recorded. 5. TITLE: SELLER agrees and warrants that the BUYER shall receive "marketable title" at the time of transfer of the Property from SELLER to BUYER. Within a reasonable time after acceptance of this Purchase Agreement, SELLER shall furnish to BUYER an abstract of title or registered property abstract, certified to date to include proper seazches covering bankruptcies, state and federal judgment and liens and levied and pending special assessments. Buyer shall have 30 business days after receipt of the abstract to examine the same and to deliver written objections to title, if any, to SELLER. SELLER shall then have until the closing date to make title mazketable at SELLER's cost. In the event that title to the Property cannot be made marketable, or is not made mazketable to the SELLER by the closing date, then, at the option of the BUYER, this Agreement shall be null and void; neither party shall be liable to the other; any earnest money will be refunded, and the parties agree to sign a cancellation of this Agreement 6. DEFAULT: If the title to the. Premises be found marketable or be so made within said time, and BUYER shall default in any of the covenants contained in this Agreement and continue into default for a period of thirty days, then and in that case, SELLER may terminate this Agreement, time being of the essence hereof. Either party shall have the right of enforcing the specific performance of this Agreement provided this Agreement shall not be terminated as aforesaid, and provided action to enforce such specific performance shall be commenced within six months after such right of action shall arise. 7. CONTINGENCIES: This Purchase Agreement is subject to the following contingencies: a. Environmental. BUYER shall have 60 days from the date of this agreement to inspect the Property and to prepaze or cause to have prepared all at BUYER's sole expense, such reports and studies as may in the BUYER"s judgment be necessary to determine whether the Property is free of contamination or pollution. BUYER may terminate this JBD-166726 2 MU195-2 U pRA~ Foy E7ISCUSSION.ONL.Y agreement if it is not satisfied that the Property is free of such pollution or contamination. b. Soils. BUYER shall have 60 days from the date of this agreement to inspect the Property and to cause to have prepared such reports and studies as may in BUYER's judgment be necessary that the condition of the soils is such as to permit the use of the Property for its intended purpose. The BUYER may terminate this agreement if it is not so satisfied. c. Tax Increment District. It is a precondition to the BUYER's obligation to purchase the Property that a tax increment district be established which includes the Property. d. Financing It is a precondition to the BUYER's obligation to purchase the Property that the BUYER has been able to satisfy the legal requirements for the sale and issuance of tax increment obligations to pay the purchase price. BUYER shall have no obligation to proceed with the purchase if such financing is not available to finance the entire purchase price. e. Survey. BUYER is satisfied as the result of a survey of the Property prepared at BUYER's expense that there are no gaps, gores or overlaps or other matters disclosed by such survey which would impact upon the intended development of the Property. To assist the Buyer in the investigations described above, SELLER hereby grants to BUYER, its agents and designated representatives the right to enter upon the Property at reasonable times and from time to time after the date of this Agreement for the purposes of inspecting the Property. 8. WELL AND SEPTIC SYSTEM DISCLOSURE: The SELLER certifies that SELLER does not know of any wells on the described real Property. Provided however, if the Property does contain wells, the cost of sealing any wells required to be capped or sealed under Minnesota law will be borne by the SELLER. If the well is not sealed by the date of closing, SELLER shall escrow a sum equal to two times the bid price from a licensed well sealing contractor to complete the sealing process. SELLER shall prepare, execute and file any required well certificate at or before closing. If the Property has a septic system, SELLER agrees to provide water quality test results and/or septic system certification as required by state law or local ordinance. 8.1 LEAD BASED PAINT DISCLOSURE. BUYER acknowledges the receipt of a lead based paint disclosure on the attached Exhibit B. 9. OTHER GENERAL AND SPECIAL WARRANTIES: a. Right of Access: SELLER warrants that there is a right of access to the Property from a public right of way. JBD-166726 3 MU195-2 wflR,~~'fi FOi~ E3ISCUSSION-ONLM( b. Mechanic's Liens: SELLER warrants that, prior to the closing date, SELLER has made any and all payments in full for all labor, materials, machinery, fixtures or tools furnished within the 120 days immediately preceding the closing date in connection with construction, alteration or repair of any structure on or improvement (including, but not limited to grading and landscaping, etc.) to the Property, if any. c. Removal of Debris: SELLER agrees to remove all debris and all personal property from the Property by date BUYER takes possession of the Property. d. Notices: SELLER warrants that SELLER has not received any notice from any governmental authority as to violation of any law, ordinance, or regulation. If the Property is subject to restrictive covenants, SELLER warrants that SELLER has not received any notice from any person or authority as to a breach of the covenants. Any notices received by SELLER shall be provided to BUYER immediately. e. ENVIRONMENTAL WARRANTY: SELLER warrants that to the best of the SELLER's knowledge no toxic or hazardous substances, including, without limitation, asbestos, urea formaldehyde, the group of organic compounds known as polychlorinated biphenyl, and any substance as defined or listed as "hazardous materials" or "toxic substances" or similarly identified in or pursuant to the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), 42 U.S.C. Section 9601-9657, as now or later amended, "hazardous materials" identified in or pursuant to the Hazardous Materials Transportation Act, 49 U.S.C. Section 1802, et seq., as now or later amended, "Hazardous Wastes" identified in or pursuant to The Resource Conservation and Recovery Act of 1976 ("RCRA"), 42 U.S.C. Section 6901 et seq., as now or later amended, any chemical substances or mixture regulated under the Toxic Substances Control Act of 1976, 15 U.S.C. Section 2601, et seq., as now or later amended, any "toxic pollutant" under the Clear Water Act, 33 U.S.C. Section 1251 et seq., as now or later amended, any hazazdous air pollutant under the Clean Air Act, 42 U.S.C. Section 7901 et seq., as now or later amended, and any hazazdous or toxic substance or pollutant now or later regulated under any other applicable federal, state or local Environmental Laws, have been generated, treated, stored, released or disposed of, or otherwise deposited in or located on the Property, including without limitation, the surface and sub-surface waters of the Property, nor has any activity been undertaken on the Property which would cause the Property to become a hazardous waste treatment, storage or disposal facility within the meaning of, or otherwise, bring the Property within the ambit of, any of the aforementioned acts or any similar state law or local ordinance or any other Environmental Law. SELLER also warrants that to the best of SELLER'S knowledge there are no substances or conditions in or on the Property which may support a claim or cause of action under any of the aforementioned acts or any ther federal, state or local environmental regulatory requirement and that no underground deposits which cause hazardous wastes or underground storage tanks of any type are located on the Property. 11. SURVIVAL OF REPRESENTATIONS AND WARRANTIES: All of .the representations, warranties, covenants and agreements of the parties hereto contained in this JBD-166726 4 MU195-2 ~F~~F'l` !~OR ~tiSC;U~SION- ONk>~ agreement shall survive the closing of the transaction contemplated herein and the delivery of any documents provided for herein and shall not be merged into any other agreement. 12. RISK OF LOSS If the Property is substantially damaged before the closing date so as to make its use for the intended purposes significantly more costly, this Purchase Agreement shall become null and void, at the BUYER's option, and earnest money shall be returned to BUYER. If such an event occurs, BUYER and SELLER agree to sign a Cancellation of Purchase Agreement within a reasonable time after such event takes place. 13. TIME OF ESSENCE: Time is of the essence in this Purchase Agreement. 14. CLOSING DATE AND LOCATION: Closing shall take place at any location which is mutually acceptable to the parties. Closing shall occur not later than 45 days after all of the preconditions to closing have been satisfied or waived. Unless extended by the mutual agreement of the parties, this agreement shall be null and void if the closing has not taken place by December 31, 1999. 15. ADDITIONAL DOCUMENTS: BUYER and SELLER agree to cooperate with the other and their representatives regarding any reasonable requests made subsequent to the execution of this Purchase Agreement to correct any clerical errors in this Purchase Agreement and to provide any and all additional documentation deemed necessary by either party to effectuate the transaction contemplated by this Purchase Agreement. 16. NOTICES: Any notice required or permitted to be given by any party upon the other is given in accordance with the Agreement if it is directed to the SELLER by delivering it personally to the SELLER; or if it is directed to the BUYER, by delivering it personally to an officer of the BUYER; or to either party if mailed in a sealed wrapper by United States registered or certified mail, return receipt requested, postage prepaid; or if transmitted to either parry by facsimile, copy followed by mailed notice as above required; or if deposited by either parry, cost paid with a nationally recognized, reputable overnight courier, properly addressed as follows: IF TO THE SELLER: Balboa Center Limited Partnership Go CK Development Company 4600 Westbury Drive - Colleyville, Texas 76034 ATTN: Gary N. Maxwell IF TO THE BUYER: Housing and Redevelopment Authority in and for the City of Mound 5341 Maywood Road Mound, Minnesota 55364 ATTN: Executive Director and City Manager JBD-166726 c~ MU195-2 17. AND COPY TO: John B. Dean KENNEDY & GRAVEN, CHARTERED 470 Pillsbury Center 200 South Sixth Street Minneapolis, Minnesota 55402 ~~I ll~ l~O !"31SCUSSION ON4~If' Notices shall be deemed effective on the earlier of the date of receipt or the date of deposit as aforesaid; provided, however, that if notice is given by deposit, that the time for the response to any notice by the other party shall commence to run one (1) business day after any such deposit. Any party may change its address for the service of notice by giving written notice of such change to the other party, or in any manner above specified, ten (10) days prior to the effective date of such change. EXECUTION IN COUNTERPARTS: This Purchase Agreement may be executed in counterparts by the parties hereto. 18. ENTIRE AGREEMENT: This Purchase Agreement, any attached exhibits and any addenda or amendments signed by the parties shall constitute the entire agreement between SELLER and BUYER, and supersedes any other written or oral agreements between SELLER and BUYER. This Purchase Agreement can only be modified in writing signed by SELLER and BUYER. 19. NOTICE: The attached notice is made a part of the Authority's offer to purchase. The undersigned, do hereby approve the above Agreement and the sale thereby made. Date: SELLER: BALBOA CENTER LIMITED PARTNERSHIP By: CK Development Company Its General Partner By: Gary N. Maxwell Its Vice-President u JBD-166726 6 MU195-2 tlR~~'f EOD _ t~ISC;t1CSl©N ONLw HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MOUND By: Its Chair By: Its Executive Director This instrument was drafted by: KENNEDY & GRAVEN, CHARTERED (JBD) 470 Pillsbury Center 200 South Sixth Street Minneapolis, Minnesota 55402 612-337-9300 JBD-166726 7 MU195-2 I~WV.~.~ ~ ... I 1 1 ~ a~1~1~ . - ~ol~ _ E")18CUSSION ONLMY NOTICE TO BALBOA CENTER LIMITED PARTNERSHIP You are hereby notified as follows: 1. The Housing and Redevelopment Authority in and for the City of Mound ("HRA") is a legal entity organized and operating in accordance with Minnesota Statutes, Chapter 469 2. Among the powers conferred upon the HRA is the power of eminent domain. 3. The parcel of land which is the subject of the attached purchase agreement is located within the area of the City of Mound which the HRA has designated as a Redevelopment Project Area. 4. It is the intention of the HRA to acquire the subject property and to make it available for redevelopment. 5. In the event that the HRA and the owner are unable to reach mutually acceptable terms concerning the purchase of the subject property, is is the present intention of the HRA to take the steps necessary, and in accordance with the applicable provisions of law, acquire the subject property through the exercise of its power of eminent domain. JBD-166726 8 MU195-2 h#~~!I~..... 470 Pillsbury Center . ~ 200 South Sixth Street Minneapolis MN 55402 ~' (612) 337-9300 telephone (612) 337-9310 fax http://www.kennedy-graven. com C H A R T E R E D JOHN B. DEAN Attorney at Law Direc[ Dial (612) 337-9207 email: jdean@kennedy-graven.com July 27, 1999 Pat Meisel Chair Iviound Housing and Redevelopment Authority City of Mound 5341 Maywood Road Mound, MN 55364 Re: Qualifying School District site for Tax Increment Treatment Dear Chair Meisel: At its July 13, 1999 meeting, the HRA adopted a resolution which was designed to provide some of the necessary groundwork for qualifying the school district site for tax increment treatment even if the structures on the site would be demolished prior to the creation of the tax increment district. In addition to the findings made in the resolution, the tax increment law requires that "the substandard building was demolished or removed by the authority or the demolition or removal was financed by the authority or was done by a developer under a development agreement with the authority." [Minn. Stat. Sect 469.174 subd. 10 (d) (1)]. This provision would enable the HRA and the School District to enter into an agreement that would recite that the district was undertaking the redevelopment of the site through the demolition of existing structures and the sale of the cleared site to a third party for construction of new improvements. The agreement would then provide that the HRA would agree to use a portion of the tax increment generated from the development of the site to reimburse the district for those costs of demolition which were not reimbursable from any other third-party source available to the district. Although the use of tax increment to cover such demolition expenses may not, by itself, provide the district with significant funds, the qualification of the site for tax increment treatment through the process described above will create the opportunity to provide additional funding to the district to cover other legitimate items in addition to the demolition expenses. Pat Meisel July 27, 1999 Page 2 of 2 If this approach seems worth exploring further; and if the school district is willing to consider it as well, I would suggest that it be brought to the HRA at its August 3 special meeting. I can attend if requested. Please let me know if I can supply you with any further information at this point. Respectfully yours, J hn .Dean JBD:gak Enclosures cc: Fran Clark Bruce Chamberlain Sid Inman JBD-166466 MU195-2 C7 . ~ Tax increment Policy ~~ ~ q~ g 3 PURPOSE 1.01 The purpose of this policy is to establish the City's position as relates to the use of Tax increment Financing for private development. This policy shall be used as a guide in processing and reviewing applications requesting Tax Increment assistance. 1.02 The City shall have the option of amending or waiving sections of this policy when determined necessary or appropriate. 2. STATUTORY LIMITATIONS 2.01 In accordance with the Tax Increment Policy, '!'1F requests must comply with applicable State Statuses. The City of Any City is governed by the limitations established in Minnesota Statutes 469.174, the Minnesota Tax Increment Financing Act for atl districts created after August 1, 1979. 3. ELIGIBLE USES FOR THE USE OF TAX INCREMENT FiNANC1NG 3.01 As a matter of adopted policy, the City of Any City will consider using Tax increment Financing (TIF) to assist private developments only in those circumstances in which the proposed private projects meet one ar mare of the following uses: A. 'fo redevelop blighted or under-utilized azeas of the community. B. To meet the following housing-related uses: l . To provide a diversity of housing adjacent to the downtown azea. 2. To provide a variety of housing ownership alternatives and housing choices. 3. To promote affordable housing for low or moderate income individuals. 4. To promote neighborhood stabilization and revitalization by the removal of blight and the upgrading in existing housing stock in residential areas. C. 'fo remove blight and encourage redevelopment in the commercial and industrial azeas of the City in order to encourage high levels of property maintenance and private reinvestment in thane areas. D. To increase the tax base of the City in order to ensure the long-term ability of the City to provide adequate services for it's residents while lessening the reliance on residential property tax. E. To retain local jobs, increase the local job base, and provide diversity in that job base. h. To increase the local business and industrial market potential of the City of Any City G. To provide adequate short term business and shopper parking, and resident parking. 6Z ~ ZZ 66 ~ ~I nnr Z0d LT9 21393071 NOl~JN I S I OH 8£898~~-Zj9 f'*^ "Wq ~~~~~ H. 1'o encourage additionalunaubsidizedprivate development in the area, either directly, or through secondary "spinoff' development. 1. To promote the potential future usage of a public transit system light rail line through maximizing the development potential of parcels adjacent to the system stations. J. To otfset increased costs of redevelopment, over and above those costs that a developer would incur in normal urban and suburban development. K. To accelerate the development process and to achieve development on sites which would not be developed without this assistance. L. To meet other uses of public policy, as adopted by the Council from time to time, including promotion of: quality urban design, quality architectural design,energyconservation,decreasing the capital and operating costs of local government, etc. 4. TAX INCREMENT PROJECT APPROVAL CRITERIA 4.01 All new projects approved by the City of Any City should meet the following mandatory minimum approval criteria. However, it should not be presumed that a project meeting these criteria will automatically be approved. Meeting these criteria creates no contractual rights on the part of any potential developer. A. The T1F assistance shall be provided within applicable state legislative restrictions, debt limit guidelines, and other appropriate financial requirements and policies. ® ve ado ted Tax increment Financing Goals of B. The project should meet one or more of the abo p the city. C. The project must be in accord with the Comprehensive Pian and Zoning Ordinances, or required changes to the plan and Ordinances must be under active consideration by the City at; the time of approval. D. "11F assistance will not be provided to projects that have the financial feasibility to proceed without the benefit of'I'ax Increment Financing. In effect, T1F assistance will not be provided solely to broaden a developer's protit margins on a project. Prior to consideration of a T1F financing assistance request! the City may undertake an independent underwriting of the project to help ensure that the request for assistance is valid. E. Prior to approval of a TIF financing plan, the developer shall provide any required market and financial feasibility studies, appraisals, sail boring, information provided to private lenders for the project, attd other information or data that the City or its financial consultants may require in order to proceed with an independent underwriting. F. To ensure cash flows are adequate projects receiving TIF assistance should normally have a l .2: l debt service coverage ratio (a ratio of funds projected to be available to funds required for debt service). G. The developer should provide adequate financial guarantees to ensure the repayment of the TIF subsidy. These may include, but are not limited to: assessment agreements, letters of credit, etc. 0£ ~ ZT 66 , £ T ~nr £0d LT 9 2l3~93071 N019N I S I OH 8£898££-z i 9 H. Any developer reyuesting_TiF assistance should able to demonstrate past successful general development capability as well as specific capability in the type and size of development proposed. I. The developer should retain ownership of the project at least long enough to complete it, to stabilize its occupancy, to establish the project management, and to initiate repayment of the TiF. 1. The level of TIF funding should be reduced to the lowest possible level by maximizing the use of private debt and equity tnancing first, and then using other funding sources or income producing vehicles that can be structured into the project financing, priorto using additional Tl F funding. TAX INCREMENT PROJECT EVALUATION CRITERIA 5.01 All projects will be evaluated on the following criteria for comparison with other proposed TIF projects reviewed by the City, and for comparison with other subsidy standards (where appropriate). it is realized that changes in local markets, costs of construction, and interest rates may cause changes in the amounu of Tax Increment subsidies that a given project may require at any given time. 5.02 Some criteria, by their very nature, must remain subjective. However, wherever possible "benchmark" criteria have been establ fished for review purposes. The tact that a given proposal meets one or more "benchmark" criteria does not mean that it is entitled to funding under this policy, but ratherthat the C ity is in a position to proceed w ith evaluations of (and comparisons betwec,t) various TiF proposals, using uniform standards whenever possible. 5.03 Following are the evaluation criteria that will be used by the City of Any City A. All TIF proposals should optimize the private development potential of a site. 13. All TTF proposals should obtain the highest possible private to public financial investment ratio. The Council establishes a benchmark ratio of 3 parts private to 1 part public funding for industrial projects. Rousing and retail/commercial projects shall be reviewed on an individual basis. C. All TIF proposals should create the highest feasible number of new jobs on the site. The Council establishes a benchmark of one newly created (or retained) FTE job pet $ of TIF assistance provided to industrial projects. Housing and RetaiUCommercial projects shalt be reviewed on an individual basis- n. All 'I'1F proposals should create the highest possible ratio of property taxes paid before and after redevelopment. Given the different assessment circumstances in the City, this ratio will vary widely. However, under normal circumstances, the Council will expect at least a 1:2 ratio of taxes paid before and after redevelopment. E. TIF proposals should normally not be used to support speculative industrial, commercial, and office projects. In general, speculative projects are defined as those projects which have letters of intent or pre-leasing for less than 50% of the available leasable space. 0£~ZT 66~ £1: ~flf b0d LZ9 a3~930~1 N019NISIOH 8£898££-ZT9 F. All TIF proposals will be reviewed to determine flee feasibility to provide the City with equity participation in new developments (through a share of the profits), or to treat the Tl F assistance as a second mortgace with fixed payments. G. All TIF proposals involving displacement of low and moderate income residents should give specific attention to the re-housing needs of those residents. Normally, this should be done as apart of the Tl F funding proposal. Adequate solutions tothese rc-housing needs will be required as a matter of public policy. H. TiF will normally not be used in a project that involves an excessive landand/or property price. This will normally be where the acquisition price is more that 10% in excess of market value. I. All TiF projects will need to meet the "but for" test. TiF will not be used unless the need for the City's economic participation is sufficient that, without that assistance the project could not proceed in the manner as proposed. J. TIF will not be used in projects that would give a significant, competitive financial advantage over similar projects in the area due to the use of tax increment subsidies. R T1F will not be used when the developer's credentials, in the sole judgement of the City, are . inadequate due to past track record relating to: completion of projects, general reputation and/or bankruptcy, or other problems or issues considered rclevalrt by the City. L. A developer using TIF will need to provide a financial guarantee for the repayment of the TiF, within the constraints of existing tax law, M . T1 F will not be used to support projects that place demands on City services, or other capital or operating expenditures, that exceed the average city expenditures for similar facilities. Consideration will be given to the total public costs that arc required to support the project, including offsite facilities costs that are required. N. TIF will not normally be used for projects that would generate significant environmental problems in the opinion of the local, state, or federal governmelits. O. TIF will not be used when the schedule for development has exceeded the schedule established in the redevelopment agreement, and where the City has not agreed to extensions of that schedule. A. TIF funding should not be provided to those projects that fait to meet good public policy criteria as determined by the Council, including: poor project quality; projects that are not in accord with the comprehensive plan, zoning, redevelopment plans, and city policies; projects that provide nn significantimprovernentto surrounding land uses, the neighborhood, and/or the City; projects that do not provide a significant increase in tax base; projects that do not have significant new, or retained, employment; projects that do not meet financial feasibility criteria established by the City; and projects that do not provide the highest and best desired use for the property. N:tMinnso~a~T1flRE50URCE~YOI,ICIES t£ ~ZT 66 ~ £t -lflf Sod Lt9 ?J3~93071 NOl~JN I S I OH 8£898££-Z Z 9 I:1',F .. 1 1 1 CITY OF ANY CI'T'Y PRE-APPI .t('A'1'I()N ~t'AX 1NCitEMENT FINANCING ASSISTANCE Legal name of applicant: Address: Telephone number: _, . _ -- Name of contact person: REQUESTED INEORNIATION Addendum shall be attached hereto addressing in detail the following: l . A map showing the exact boundaries of proposed development. 2. Give a gctieral description ofthcproject including size and location ofbuilding(s); business typo or usc; traffic information including parking, projected vehicle counts and traffic flow; timing of the project; estimated muket value following completion. a. 1'he existing Comprehensive Guide Plan Land Use designation and cuniug of the property. Include a statement as lu Irow tlic p~op~,scd development will conform to the land usc designation and how the property will be Zoned. 4. A statement identifying hew the increment assistance wil! be used and why it is necessary to undertake the project. 5. A statement identifyins the public benefits of the proposal including estimated increase in property valuation, new Jobs to be created and other community assets. 6. A written rrrcrective nt'the developers company of corporation, principals, history and past projects SIGNATURE Applicant's signature: Date: ,, X96 wwu ~i ZS~Zi 66. sT nor 90d LT9 ~3n~30~1 N019MISIOH 8~899cc-Zi9 ~I'"i "'~~ ror l it ~. 1 CiT'Y OF ANY CITY Application for Tax Increment t inancin~ GLNGRAL 1NfORMATION: Fliiciness Name: Date: Add-css: _. . 't'ype (Partnership, etc..): Authorized Representative: Phone: _ __ Description of Susincss: Legal Counsel: Address: Phnne: FINANrIAL BACKGROUND: 1. Have you evcr filed for bankruptcy? ~.. Have yc,u ever defaulted on any loan commitment? 3. Haut yuu applied for conventional financing for tha project? d. List financial ref'erencec: a. . . b. c. 5. Have yogi ever used Tax Increment Financing before? If yep, wLe~Y atyd when? Z~=ZT 66. ST ~flf LOd LT9 213~930~1 M019MISIOH 8~898~~-ZT9 ®'"'' 1 1 1 • PROJECT INFORMATION: t. Location of Proposed Project: 2. An{uuut of Tax Incrcnunt Assistance rcqucstod? ____^_~_ ____,,, ,,,,, . __.... ,., . 3. Need for Tax Increment Assistance: 4. Prc:sc:nt ownership of site: ~. Number of permanent jobs created as a result of project? 6. Estimated annual sales: Present: Flmlrr.• 'I. Market value of project following completion: 8. Name and address of architect: 9. Anticipated start date: Completion Dnte: h•INAN(:IAI. INFOKMA'1'I(N~ 1. Estimated project related cosu: a. land acquisition 3 b. s{te development c. building cost d. equtpment c. architectural/engineering fee f legal fer.S g. off-site development costs 2. Source of financing: a. private financing institution $ b. tax increment fiends c. other public funds d. developer equity Z~=Zi 66. S:T Xlr 80d Lt9 LI3'1930~1 ~1018rIISIOH 8~998~~-ZT9 PLEASE INCLUDE: 1. Preliminary financial commitment from bank. 2. Plans and drawing of project. 3. Background material of company. 4. Pro Forma analysis. 5. Financial statements. 6. Statement of property ownership or control. 7. Payment of application fee ($ .00). N:1MinnsotulTlF1RESOURCE~POLICIES . _, d`~ ~nr +" [] ££ ~ Z T 66 ~ £ t "lf l!' 60d L 19 a3~93071 N019N I S I OH 8£898££-Z I9 PROCEDURES ~I~ >;„;I"' ~~ 1. Meet with appropriate City Staff to discuss the scope of the project, public participation being requested, and other information as may be necessary. 2. Completion of Preliminary Tax Increment Financing Assistance Application form. This form shall be submitted to the Director of Co-nmunity Development. 3. The request shall be reviewed by City Staff on a preliminary basis as to the feasibility of the project. The staff shall prepare a report on the project. 4. 'fhe application shall be placed on the City Council agenda for concept review. The applicant may make a formal presentation of the project. The Staffwill present its' findings. 5. If the Council's Preliminary Concept Review is positive, the applicant may elect to file a formal application accompanied by anon-refundable fee of $ which shall only be refunded at the time of signing a redevelopment contract should the project be approved_ 6. if Zoning and Planning Commission action is required, it will be necessary for the applicant; at this lime, to make application to the Commission for Concept Review. 7. Following the necessary financial analysis and preparation of detailed plans, the City Council and EIR.A, if necessary, shall take action on the project. if approved, the staff will be directed to undertake the following steps: - prepare a redevelopment agreement based upon the teens approved - prepare a redevelopment plan and tax increment financing plan if required At this time a deposit (cash or letter of credit) shall be required to defray costs involved with these steps which shall also be refunded at the tine a redevelopment contract is signed should the project be approved '~~ 8. If a redevelopment plan or zoning action is required, the Zoning and Planning Commission, City Council and HRA shall take the appropriate action at the same time that the redevelopment agreement is considered for approval. N;1Minnsaa1T1F1R ESUURCE~POLIC IES ££ ~ Z T 66 ,~ i -1f 1!' 0 T d L 1 9 b3~930~1 N019N I S I OH 8~898~~-Z T 9