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2002-08-13~i-~ ~~~~ AGENDA MOUND HOUSING AND REDEVELOPMENT AUTHORTTY AUGUST 13 2002 6:30 P.M. 1. OPEN MEETING 2. ACTION APPROVING AGENDA, WITH ANY AMENDMENTS 3. ACTION APPROVING MINUTES: JULY 23, 2002 REGULAR MTG ~_g 4. POST OFFICE PROJECT A. PUBLIC HEARING ON BUSINESS SUBSIDY AGREEMENT 4_g WITH ROD DIETRICH • B. ACTION APPROVING BUSINESS SUBSIDY AGREEMENT 5. ACTION SETTING SET DEVELOPER WORKSHOP: RECOMMEND 9/3, 6:30 PM (This is to be a joint HItA/CC meeting). 6. ADJOURN • • CITY OF MOUND HOUSING AND REDEVELOPMENT AUTHORITY JULY 23, 2002 The Housing and Redevelopment Authority of and for the City of Mound, Minnesota, met in regular session on Tuesday, July 23, 2002, at 6:30 p.m. in the council chambers of City Hall. Members Present: Chairperson Pat Meisel; Commissioners Mark Hanus, David Osmek and Peter Meyer. Commissioner Brown arrived at 6:38 p.m. as noted. Others Present: Executive Director, Kandis Hanson; City Clerk, Bonnie Ritter; Community Development Director, Sarah Smith; Finance Director, Gino Businaro, Sarah Carlson, Tom Stokes, Chuck Alcon 1. OPEN MEETING Chairperson Meisel called the meeting to order at 6:30 p.m. 2. APPROVE AGENDA MOTION by Hanus, seconded by Osmek to approve the agenda as presented. All voted in favor. Motion carried. 3. APPROVE MINUTES • MOTION by Osmek, seconded by Hanus to approve the minutes of the July 9, 2002 meeting. All voted in favor. Motion carried. 4. SET DATE FOR BUSINESS SUBSIDY AGREEMENT PUBLIC HEARING MOTION by Osmek, seconded by Hanus to set a public hearing on a Business Subsidy Agreement with Rod Dietrich, for August 13, 2002, at 6:30 p.m. All voted in favor. Motion carried. 5. REPORT BY VIP PROPERTIES ON INDIAN KNOLL MANOR Sarah Carlson informed the Council that a contract for the roof repair, as discussed at the last meeting, will be prepared for signature. There was discussion regarding the Wells Fargo account that was used for the separation of pass-through funds. It was the consensus of the Commission to close that account and use only the MBIA account and the Wells Fargo Account that used to be the Marquette account. Commissioner Brown arrived at this point - 6:38 p.m. MOTION by Osmek, seconded by Hanus to approve payment of the July, 2002 bills as presented. All voted in favor. Motion carried. • -2- HRA Minutes -July 23, 2002 6. RECESS THE MEETING • Chairperson Meisel recessed the meeting at 6:42 p.m. 7. RECONVENE MEETING TO RUN CONCURRENT WITH CITY COUNCIL Chairperson Meisel reconvened the meeting at 11:30 p.m. 8. PRELIMINARY DEVELOPMENT AGREEMENT WITH MOUND HARBOR RENAISSANCE. LLC. Chuck Alcon presented a preliminary schedule of all phases of the redevelopment. John Dean reviewed the draft of the subject agreement, with discussion on proposed revisions. MOTION by Brown, seconded by Osmek to approve the Preliminary Development Agreement with Mound Harbor Renaissance, LLC, as amended. All voted in favor. Motion carried. 9. RESETTING REGULAR MEETING DUE TO ELECTION DAY MOTION by Hanus, seconded by brown to reschedule the regular meeting from September 10, to September 9, 2002, at 6:30 p.m. This is due to the primary election. All voted in favor. Motion carried. 10. ADJOURN • MOTION by Osmek, seconded by Brown to adjourn the meeting at 11:55 p.m. All voted in favor. Motion carried. Chairperson Pat Meisel Attest: Executive Director Kandis Hanson • 2 -3- J • CITY OF MOUND PUBLIC HEARING NOTICE The Housing and Redevelopment Authority of and for the City of Mound, Minnesota, as part of its operations, provided economic assistance to individuals who are engaged in the development and redevelopment of land within the HRA's area of operation. Pursuant to state statute, the HRA has adopted criteria for awarding business subsidies prior to granting such assistance. A public hearing on the adoption of a business subsidy agreement with Rodney R. Dietrich and Doreen K. Dietrich for the Mound Post Office project will be held before the HRA. The public hearing on the business subsidy agreement will also include a consideration of alternative goals in lieu of wage and job goals. Copies of the proposed business subsidy agreement will be available for public inspection on and after the date of this notice at Mound City Hall during normal business hours. WHEN: Tuesday, August 13, 2002 6:30 p.m.. -Housing and Redevelopment meeting WHERE: Mound City Hall Council Chambers 5341 Maywood Road Mound, MN 55364 HOW TO COMMENT: Attend the hearing and you will be heard or submit written comments. Bonnie Ritter City Clerk ~2~, -4- PROPOSED AGREEMENT • Dietrich Business Subsidy Agreement. ARTICLE I Business Subsidy Act Requirements Section 1.1. Compliance with Business Subsidy Provisions. The parties agree and represent to each other as follows: (a) Unless the context clearly indicates otherwise, the terms used in this article shall have the meanings given then in this Agreement and the Assignable Option to Purchase Land, the First Amendment to the Assignable Option to Purchase Land and in the Business Subsidy Act (Minnesota Statutes, Sections 116J.993 through 995). (a) The subsidy provided to the Dietrich pursuant to this Agreement consists of the a reduction of the purchase price of the Property, representing a subsidy with an estimated value of $ • 122,000. (b) The public purposes of the subsidy are to promote redevelopment of downtown Mound, obtain certain building enhancements that are consistent with the design program for buildings in downtown Mound, generate spin-off development and redevelopment in downtown Mound, and increase the tax base of the City and the State. The Crrantor, following public hearing has determined that the achievement of wage and job levels are not goals of the subsidy. (c) The goals for the subsidy are to secure construction of the Minimum Improvements on the Property; to maintain the Minimum Improvements for at least five years as described in clause (f) below (d) If the goals described in clause (c) above are not met, the Dietrich must make the payments to the HRA described in Section 1.3 of this Agreement. (e) The subsidy is needed because the cost of acquiring the Redevelopment Property at fair market value plus the cost of the Minimum Improvements makes redevelopment of the Redevelopment Property financially infeasible without public assistance. (f) The operation of the Minimum Improvements as an office, service and retail facility must continue for at least five years after the date of issuance of the Certificate of Completion. (g) The Dietrich does not have a parent corporation. e -5- • (h) The Dietrich has not received, and does not expect to receive financial assistance from any other grantor as defined in the Business Subsidy Act in connection with purchase of the Redevelopment Property or construction of the Muumum Improvements. Section 1.2. Construction of Improvement. Dietrich will complete construction of the Development within 12 months of the date of this Agreement The HRA may, after a public hearing, extend the Compliance Date by up to one year, provided that nothing in this Section 1.2 will be construed to limit the HRA's legislative discretion regarding this matter. Section 1.3. Remedies. If the Dietrich fails to meet the goals described in Section l.l(c), the Dietrich shall repay the HRA within one year upon written demand from the HRA a pro rata share of the amount of the subsidy granted by this Agreement and interest on said amount at the implicit price deflator as defined in Minnesota Statutes, Section 275.50, subd. 2, accrued from the date of issuance of the Certificate of Completion to the date of payment. For purposes of this Section 10.3, the amount which the Dietrich must repay within one year to the HRA, is the present value of the unpaid balance of the Loan. The term pro rata share means percentages calculated as follows: (i) if the failure relates to maintenance of the office, service and retail facility in accordance with Section 10.1(f), 60 less the number of months of operation as an office, service and retail facility (where any month in which the facility • is in operation for at least 15 days constitutes a month of operation), commencing on the date of the Certificate of Completion and ending with the date the facility ceases operation as determined by the HRA, divided by 60; and Nothing in this Section 1.3 shall be construed to limit the HRA's remedies under this Agreement. In addition to the remedy described in this Section 1.3 and any other remedy available to the HRA for failure to meet the goals stated in Section l .l (c), the Dietrich agrees and understands that it may not a receive a business subsidy from the HRA or any grantor as defined in the Business Subsidy Act for a period of five years from the date of the failure or until the Dietrich satisfies its repayment obligation under this Section 1.3, whichever occurs first. Section 1.4. Reports. The Dietrich must submit to the HRA a written report regarding business subsidy goals and results by no later than March 1 of each year, commencing March 1, 2003 and continuing until the later of (i) the date the goals stated Section 1.1(c) are met; (ii) 30 days after expiration of the five-year period described in Section 1.1(f); or (iii) if the goals are not met, the date the subsidy is repaid in accordance with Section 1.3. The report must comply with Section 116J.994, subdivision 7 of the Business Subsidy Act. The HR.A will provide information to the Dietrich regarding the required forms. If the Dietrich fails to timely file any report required under this Section 1.4, the HRA will mail the Dietrich a warning within one week after the required filing • date. If, after 14 days of the postmarked date of the warning, the Dietrich fails to provide a report, the Dietrich must pay to the HRA a penalty of $100 for each subsequent day until the report is filed. The maximum aggregate penalty payable under this Section 1.4 is $1,000. -6- IN TESTIMONY WI~REOF, the parties hereto have set their hands as of the day and year first above written. THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MOUND By Its Executive Director STATE OF MINNESOTA ss.. COUNTY OF HENNEPIN • The foregoing instrument as acknowledged before me this day of , 200 by ,the Executive Director of the Housing and Redevelopment Authority in and for the City of Mound, a public body politic and corporate under the laws of Minnesota, on behalf of the Authority. Notary Public RODNEY R. DIETRICH DOREEN K. DIETRICH • -7- • STATE OF MINNESOTA ss.. COUNTY OF HENNEPIN The foregoing instrument was executed this day of , 200_, by Rodney R. Dietrich and Doreen K. Dietrich, husband and wife.. Notary Public • -8- t This Page Is Left Intentionally Blank •i ~~ i -9-