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HRA Agenda 11-07-2007AGENDA MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY Wednesday, November 7, 2007 - 6:00 p.m. Bridge Room -Community Center Commissioners: Vice Chair Bill Fair, Dan Frie, and Sandy Suchy. Council Liaison: Wayne Mayer. Staff: HRA Executive Director Ollie Koropchak and Recorder Angela Schumann. 1. Call to Order. 2. Consideration to approve the September 12, 2007 HRA minutes. 3. Consideration of adding or removing items from the agenda. 4. Consent Agenda: S. Consideration to grant the Executive Director the authority to award a building material inspection bid for Cedar Street Garden Center and further direction for demolition. 6. Consideration to adopt a resolution relating to the transfer of HRA project and programs to the City of Monticello Economic Development Authority 7. Consideration to authorize payment of HRA bills. 8. Consideration of HRA Executive Report. 9. Committee Reports: Marketing Fiber Optics 10. Adjournment. CJ U MINUTES MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY Wednesday, September 12, 2007 - 6:00 p.rn. Bridge Room -Community Center Commissioners Present Council Liaison Absent: Staff: 1. Call to Order. Vice Chair Bill Fair, Brad Barger, and Dan Frie. Wayne Mayer. HRA Executive Director Ollie Koropchak Angela Schumann. Chairman Fair called the meeting to order and declared a quorum. 2. Consideration to approve the August 1, 2007 HRA minutes. MOTION BY COMMISSIONER FRIE TO APPROVE THE MINTUES OF AUGUST 1, 2007. LJ MOTION SECONDED BY COMMISSIONER BARGER. MOTION CARRIED, 3-0. 3. Consideration of adding or removing items from the a eg nda. Koropchak added payment of bills as item 8. Barger noted that this is his last HRA meeting. The Council plans to appoint a temporary person for the purpose of formal motions. Frie asked if Mayer could be appointed. Koropchak stated that she thought perhaps the Council would appoint a previous commissioner. 4. Consent A enda. NONE. C] S. Consideration to review for approval an application for Transformation Home Loan No.3 for the property located at 312 East River Street. Fair asked about the Building Official's report. Koropchak stated that the Building Officials' report was in the agenda and that Chief Building Official Anderson estimated value to upgrade is $24,000. It was originally $20,000. In HRA Minutes - 09/12/07 2006 the estimated value was set at $127,000, sa it is below the guidelines set for the loan program. Koropchak stated that the home qualifies as substandard. Karopchak stated that she assumed that the HRA didn't want to approve a Transformation Home Loan that didn't fix the items that are required to bring the home up to code. The recommendation from the Building Official is also attached. Those are added casts. Koropchak stated that there is a bank loan to buy the house. Based on the contractor's estimates, there are $38,225 of expenses. The bank and the applicant confirmed that they were willing to do the additional improvements recommended by the Building Official. Koropchak distributed a letter confirming the loan for purchase and noting dollars as a second mortgage from MNHFA. She stated that the HRA's mortgage will be a third mortgage. Fair asked for confirmation on the total loan amount. Koropchak stated builders cost plus $3,400, or up to 25%. Fair noted that the property is going from renter to owner occupied MOTION BY COMMISSIONER BARGER TO APPROVE AN APPLICATION FOR TRANSFORMATION HOME LOAN N0.3 FOR THE PROPERTY LOCATED AT 312 EAST RIVER STREET. MOTION SECONDED BY COMMISSIONER FRIE. MOTION CARRIED, 3-0. 6. Consideration of a res onse to the HRA's offer from the owners of the ra ert located at 101 Third Street East. Fair noted that they did not make a counteroffer. Koropchak stated that they just refused the offer. Fair asked if the Council is aware of this property as a potential purchase. Koropchak stated that individual members are aware, but she does not know if the whole group is. Fair asked if they are still struggling with space far the DMV. Koropchak stated that was undecided at this time. Fair stated that the HRA could send them a letter of consideration and if they are interested, the HRA is willing to hear alternative proposal. Fair noted that it is contiguous to City property. MOTION BY COMMISSIONER FRIE TO RECOMMEND THAT A LETTER OF NO INTEREST BE SENT TO THE PROPERTY OWNER. MOTION SECONDED BY COMMISSIONER BARGER. MOTION CARRIED, 3-0. 2 HRA Minutes - 09/12/07 7. Consideration of an u date: Summons -HRA and others named versus Metro Home Insulation LLC Transformation Home Loan - 511 Elm Street. Fair noted it as an update and that no action is required at this time. Koropchak reported that the HRA is named on a claim on behalf of Metro Home Insulation, that Dennis James, as contractor, did not provide payment for services. Koropchak stated that she had sent the summons information to the HRA attorney, who advised her to send the material to the City Attorney. As such, Tom Scott of Campbell Knutson responded to the summons on behalf of the HRA. Tom Scott also stated that he did talk to the lawyer representing Metro Home and they are trying to collect out of court. He did note that there were others that didn't get paid. Koropchak reported that she had a check written to the title company, and they had title insurance for $127,000 to do the improvements. Scott said that he called title company and they are no longer there. Koropchak stated she has authorized disbursement of HRA funds through the title company in the amount of $20,000. Koropchak stated that the final amount was not released until the project was done and the Building Official had done the inspection. Fair asked about lien waivers. Frie noted that some title companies are not good about collecting lien waivers. Frie noted that James shouldn't be allowed an other Transformation Home Loan projects. Frie also recommended that applicants should use the HRA's designated title company. The HRA mortgage is released after 5 years if they stay. There was no other action required for the HRA, as it was granted an extension on the summons. 5. Consideration to authorize a ent of HRA bills. Koropchak stated that the invoices included should represent the last invoices for the Walker In-Store project. She stated that the total for HRA legal expenses on the project is probably $15,000. The HRA should consider the legal expenses for such a small project. Barger asked what Walker paid for the land. Koropchak stated that they received a 5.5 acre parcel, with a developable acreage of 1.5. It was sold at $43,560 for 1.5 acres. Frie noted that they had paid a legal deposit, which is non-refundable, of $10,000. MOTION TO AUTHORIZE FAYMENT OF HRA BILLS BY COMMISSIONER BARGER. MOTION SECONDED BY COMMISSIONER FAIR. MOTION CARRIED. 9. Consideration of HRA Executive Re ort. C7 HRA Minutes - 09/12/07 Koropchak provided her report and noted that in regard to the potential EDA and HRA consolidation, there will be a meeting of the personnel committee on the 20th and then a special workshop on Monday the 24th at 5:00. Frie noted that there was a good size group going to the Anoka-Ramsey Community College in terms of furthering the bia-science project. 10. Committee Re orts. NONE. 11. Next re lar HRA meetin . Pending outcome of upcoming workshops on the EDA/HRA merger. 12. Adtournment. MOTION BY COMMISSIONER BARGER TO ADJOURN. MOTION SECONDED BY COMMISSIONER FRIE. MOTION CARRIED, 3-0. • C. 4 HRA Agenda -11/07/07 5. Consideration to rant the Executive Director the authori to award a buildin material ins ection for Cedar Street Garden Center and further direction for demolition. A. Reference and back round: The HRA (buyer) and Leslie DeLisi and Anthony P. DeLisi (sellers) entered into a Purchase Agreement dated May 9, 2007, for an agreed upon price of $450,000 for the Cedar Street Garden Center, 201 East Broadway. Legal description: Lots 1-9, Block B, Original Plat. The HRA agreed that the sellers could continue to operate their business through the end of 2007, rent free. The closing occurred on June 25, 2007, at Preferred Title. The going-out-of-business auction via a web site is expected to run through October 31 with a couple days thereafter for pick-up of items. Within the Purchase Agreement, the sellers acknowledged there were no aboveground or underground storage tanks located in or about the property. About a month ago, the seller asked the HRA Office of whether to proceed with filling the underground fuel tank as the supplier had contacted them. I talked with the supplier who verified the tank was underground and they were advised not to refill the tank. As soon as the sellers have advised the HRA the property is vacant and turned over the keys, the public . works department will disconnect the public utilities. Public Works Director John Simola and myself are working together to secure bids for inspection and materials testing for hazardous substances in the Garden Center facility and another site for acquisition under consideration by the City Council. One bid has been received from Braun Intertec at an estimated cost of $1,630.00. It is our intent to obtain a second bid from American Testing; however, this will not be available for the HRA commissioners to consider. We will begin to work an the demo specification for both properties next week with the intent for demolition mid November. The HRA Office has had a couple of inquiries to the HRA's intent or plans for the property. The Deputy Register's Office asked about the potential to relocate their operations to that site. Given the building was not constructed for use as an all-year type office building, City Staff did not find a temporary use by the Deputy Register's as the best investment and use of the property. A chiropractic office inquired of interest to condo space if a redevelopment project was planned. Lastly, the Public Works Department did not have use far the property. First, this agenda item is asking the HRA to grant the Executive Director the authority to award a building materials inspection for the Garden Center, in lieu, of the fact the amended and restated EDA may not be formed in order to proceed on a timely and joint project with public HRA Agenda - 11/07/07 works department. Secondly, this agenda item requests direct~an be given to proceed with demolition of the Garden Center for the same reasons. It is city staff s recommendation that the Garden Center be demolished for security reasons. Should the EDA form prior to the award for demolition, the EDA would authorize award of the demolition bid. B. Alternative Action: 1. A motion granting the Executive Director the authority to award the building materials inspection bid and the demolition bid if necessary based on the recommendation of city staff. 2. A motion to deny the Executive Director the authority to award the building materials inspection bid and demolition bid prior to finalization of the EDA. 3. A motion of no interest to demolish the buildings at 201 East Broadway. C. Recommendation: It is the recommendation of the Public Works Director and the HRA Executive Director to grant the authority to the Executive Director. This alternative appears to conserve staff time and hopefully receive cast effective bids with two projects. D. Su ortin Data: One building material inspection bid. 2 Braun InteAae Corparatian Phone: 320.253.9940 1520 24th Avenue N Fax: 320.253.3054 Saint Cloud, MN 56303 Web: 6rauninterteccom October 25, 2007 Mr..lohn Simola City of Monticello 909 Golf Course Road Monticello, MN 55362 Proposal SC-67-05283 Re; Proposal for aPre-Demolition Hazardous Building Material Inspection Cedar Garden Center 201 E. Broadway Monticello, Minnesota Dear Mr. Simola: Braun Intertec Corporation (Braun Intertec) is pleased to present this proposal to provide services and cost estimates For apre-demolition hazardous building material inspections of the building at the above referenced Site. This proposal is broken down into the following sections: Scope of Services Cast Estimates • Schedule • Limitations • GeneralInforrnation Scope of Services The goat of the inspection will be to identify potentially hazardous building material that require separate handling and/or disposal prior to demolition of the building at the above referenced Site. The inspection will be conducted by our experienced and accredited asbestos and lead building inspectors. Our representatives will perform the following services: • Visually examine accessible areas and identify the locations of suspect asbestos-containing materials (ACM), lead, poly-chlorinated biphenyls (PCBs), mercury, and other miscellaneous hazardous materials. • Collect and analyze representative bulk samples of materials suspected of containing asbestos. Examples of materials to be collected for analysis include, but are not limited to: floor tile, linoleum flooring, wall and ceiling plaster, suspended and acoustical ceiling tile, sheetrock, thermal system insulation, textured ceiling material, and fireproofing. • Conduct limited lead-based paint testing of deteriorated painted surfaces suspected of containing lead (if applicable). Testing will be accomplished by collecting bulk samples of the paint. • Document the various materials' current conditions and ACM quantities. • Generate a final report documenting the sample locations, analysis results, conditions, ACM quantities, and recommendations. Celebrating 50 years of growth through service and trust City of Monticello Proposal SC-07-05283 October 2S, 2007 Page 2 Cost Estimate Braun Tntertec will provide the above scope of services on a cost plus basis for an estimated fee of $1,630. This fee is broken down in the attached Cost Bstirnate detail sheet. Unit prices for time and expenses are set costs. Other figures such as number of hours to perform the inspection, number of samples, report time, etc., are estimated figures. Consequently, our estimated costs may be higher or lower depending on the actual site conditions encountered. The total projected cost will not be exceeded without additional authorization. The above cost estimate is based on a 5-day laboratory turnaround time (Standard) for bulk asbestos sample analysis. The terms and conditions under which these services will be provided are detailed in the attached General Conditions, which are part of this proposal. Payment is due upon receipt of invoice with interest added to unpaid balances after 30 days. Schedule Based on our current schedule, approximately one to two weeks from receiving your signed authorization will be required to complete the hazardous building materials inspection. If the project is not authorized within 30 days, we may need to modify the proposed schedule. Tf the project cannot be completed within the proposed schedule due to circumstances beyond our control, revising the proposal may be required for completion of the remaining tasks. Limitations In any building the potential exists for hazardous building materials to be located inside walls, above ceilings, under floors, buried underground, and other inaccessible areas. This inspection will attempt to identify hazardous building materials in these inaccessible areas. However, it is not feasible to inspect 100 percent of these areas. Therefore, Braun Intertec cannot be held responsible for the presence of any such hidden materials. The demolition cantra.ctor and other contractors involved in the project should be made aware of the potential for hazardous building materials to be located in inaccessible areas. if previously unidentified suspect hazardous building materials are exposed during their activities they should be sampled and analyzed for content prior to any disturbance. Sampling of materials for asbestos content involves the collection of a small piece of that material.. Some damage is inevitable. However, every effort will be made to Limit cuts and holes to discreet locations. Our representatives will not be responsible for repairing materials damaged during sampling. • City of Monticello Proposal SC-07-05283 October 25, 2007 Page 3 General Information The Braun Intertec personnel conducting the inspection are fully accredited building inspectors, in accordance with state and federal regulations. Our microscopy laboratory is fully accredited for polarized light microscopy (PLM) asbestos bulk sample analysis by the National Institute of Standards and Technology's (KIST) National Voluntary Laboratory Accreditation Progrann (NVLAP #101234). Quality control uaformation is available upon request. Braun Intertec is capable of assisting you with appropriate response actions based on our inspection report. These may include the following: Designing and coordinating an abatemeut project design Performing on-site monitoring/project management during hazardous material abatement projects and recording contractor's compliance with federal, state, and local regulations Proposed services and cost estimates for the above response actions can be prepared following completion of the hazardous building materials inspection report. We look forward to working with you. If you have questions or if we can be of further assistance, please call Andrew Brummer at 320-202-7236. Sincerely, CORPORATION Project Scientist Attachments: Cost Estimate Detail General Conditions (6/15/06) Proposal-Har~3ldglnsp.doc • • Signature Page Re: Proposal for aPre-Demolition Hazardous Building Material Inspection Cedar Garden Center 201 E. Broadway Monticello, Minnesota City of Monticello Proposal SC-07-052$3 October 25, 2007 Page 4 Braun Intertec appreciates the opportunity to present this proposal to you. It is being presented in duplicate so if it is acceptable, the original can be retained for your records and the copy can be signed and returned to us by fax ar U.S. MaiX in its entirety, including the Genera[ Conditions, as written authorization to proceed. We will begin the project upon receipt of your authorization. The estimated cost of $1,630 presented in this proposal is based on the scope of services described and the assumption that the proposal will be authorized within 30 days and that the project will be completed within the proposed schedule. Ifthe project is not authorized within 30 days, we may need to modify the proposal. If the project cannot be completed within the proposed schedule due to circumstances beyond our control, revising the proposal may be required for completion of the remaining tasks. Invoices will be submitted monthly and are due on receipt, with interest added to unpaid balances after 30 days. The terms and conditions under which these services will be provided are detailed in the attached General Gonditions, which, are part of this proposal. Authorization to Proceed: Please proceed according to the described scope of services and General Conditions: Authorizer's Name (please print or type) Authorizer's Signature Authorizer's Title Authorizer's Firm Date Proposal-HazBld gCnsp.doc sRauH ~NTERTEC COST ESTIMATE 5C-07-05283 Cedar Garden Center City of Monticello John Slmoia Public Works Department 909 Golf Course Road Monticello, MN 55362 Service Desc: Hazardous Materials Survey Work Lncatlon: 201 E. Broadway Monticello, MN Estimator: Brummer, Andrew J Description: Hazardous Materials Assessment Field Technician L®ad in Paint test Project Management &~ Reporting Project Scientist Senior Scientist Expenses Trip charge Analytical Asbestos tests SUMMARY Hazardous Materials Assessment Project Management ~ Reporting Expenses Analytical Quantity: Units: Unit Price: Extension: 3.00 Hours 75.00 225.00 5.00 Tests 30.00 150.00 Phase Total: $375.00 8.00 Hours 81.00 648.00 1,00 Hours 132.00 132.00 Phase Total: $780.00 1.00 Trips 35.00 35.00 Phase Total: $35.00 20.00 Tests 22.00 440.00 Phase Total: $440.00 375.on 780.00 35.00 440.00 Total: $1,630.00 Page 1 of 1 General Conditions Our agreement ("Agreement") with you consists of these General Conditions and the accompanying written proposal or authorization. Section 1: Our Responsibilities 1.1 We will provide the services specifically described in our Agreement with you. You agree that we are not responsible for services that are not fairly included in our specific undertaking. Unless otherwise agreed in writing, our fmdings, opinions, and recommendations will be provided to you in writing. You agree not to rely on oral findings, opinions, or recommendations without our written approval. 1.2 In performing our professional services, we will use that degree of care and skill ordinarily exercised under similar circumstances by reputable members of our profession practicing in the same locality. I£you direct us to deviate ftom our reconuuended procedures, you agree to hold us harmless from claims, damages, and expenses arising out of your direction. 1.3 We will reference our field observations and sampling to available reference points, but we will not survey, set, or check the accuracy of those points unless we accept that duty in writing. Locations of field observations or sampling described in our report or shown on our sketches are based on information provided by others or estimates made by our personnel. You agree that such dimensions, depths, or elevations are approximations unless specifically stated otherwise in the report. You accept the inherent risk that samples or observations may not be representative of things not sampled or seen and, further, that site conditions may change over time. 1.4 Our duties do not include supervising your contractors or commenting on, overseeing, or providing the means and methods of their work, unless we accept such duties in writing. We will not be responsible for the failure of your contractors to perform in accordance with their undertakings, and the providing of our services will not relieve otters of their responsibilities to you or to others. 1.5 We will provide a health and safety program for our employees, but we will not be responsible for contractor, job, or site health or safety unless we accept that duty in writing. 1.6 You will provide, at no cost to us, appropriate site safety measures as to work areas o be observed or inspected by us. Our employees are authorized by you to refuse to work under conditions that may be unsafe. 1.7 Estimates of our fees or other project costs will be based on information available to us and on our experience and knowledge. Such estimates are an exercise of our professional judgment and are not guaranteed or warranted. Actual costs may vary. You should allow a contingency in addition to estimated costs. Sectlon 2: Your Responsibllities 2.1 You will provide us with prior geotechnical and other reports, specifications, plans, and information to which you have access about the site. You agree to provide us with al] plans, changes in plans, and new information as to site conditions until we have completed our work. 2.2 You wil[ provide access to the site. In the course of our work some site damage is normal even when due care is exercised. We will use reasonable care to minimize damage to the site. We have not included the cost of restoration of normal damage in the estimated charges. 2.3 You agree to provide us, in a timely manner, with information that you have regarding buried objects at the site. We will not be responsible for locating buried objects at the site unless we accept thaC duty in writing. You agree to hold us harmless from claims, damages, losses, and related expenses involving buried objects of which you had knowledge but did not timely call to our attention or correctly show on the plans you or others on your behalf furnished to us. 2.4 You will notify us of any knowledge or suspicion of the presence of hazardous or dangerous materials in a sample provided'ty us. You agree to provide us with information in your possession or control relating to contamination at the work site. if we observe or suspect the presence of contaminants not anticipated in our Agreement, we may terminate our work without liability to you or to others, and we will be paid for the services we have provided. 2.S Neither this Agreement nor the providing of services will operate to make us an owner, operator, generator, transporter, treater, storer, or a disposal facility within the meaning of the Resource Conservation Recovery Act, as amended, or within the meaning of any other law governing the handling, treatment, storage, or disposal of hazardous materials. You agree to hold us harmless and indemnify us from any such claim or loss. e Rau N INT~RTEC 2.b Monitoring wells arc your property, and you are responsible for their permitting, maintenance, and abandonment unless we accept that duty in writing. 2.'7 You agree to make disclosures required by law. In the event you do not own the site, you acknowledge drat it is your duty to inform the owner of the discovery or release of contaminants at the site. You agree to hold us harmless and indemnify us from claims related to disclosures made by us that are required by law and from claims related to the informing or failure to inform the site owner of the discovery of contaminants. Section 3: Reports and Records 3.1 We will furnish reports to you in duplicate. We will retain analytical data for seven years and financial data for three years. 3.2 Our reports, notes, calculations, and other documents and our computer software and data are instruments of our service [o you, and they remain our property but are subject to a license to you for your use in .the related project for the purposes disclosed to us. You may not transfer our reports to others or use them for a purpose for which they were not prepared without our written approval, which will not be unreasonably withheld. You agree to indemnify and hold us harmless from claims, damages, losses, and expeuses, including attorney fees, arising out of such a transfer or use. At your request, we will provide endorsements of our reports or letters of reliance, but only if the recipients agree to be bound by the terms of our agreement with you and only if we are paid the administrative fee stated in our then current Schedule of Charges. 33 Because electronic documents may be modified intentionally or inadvertently, you agree that we will not be liable for damages resulting from change in an electronic document occurring after we transmit it to you. In case of any difference or ambiguity between an electronic and a paper document, the paper document shall govern. 3.4 If you do not pay far our services in full as agreed, we may retain work not yet delivered to you and you agree to return to us all of our work that is in your possession or under your control. You agree not to use or rely upon our work For any purpose whatsoever until it is paid for in full. Page 1 of 2 Providing engineering and environmental solutions since 1957 3S Samples remaining after tests are ' ~ conducted and field and laboratory equipment i ~ that cannot be adequately cleansed of contaminants arc and continue to be your property. They will be discarded or returned to you, at our discretion, unless within 15 days of the report date you give us written direction to i store or transfer the materials at your expense. Section 4: Compettsatian 4.1 'You will pay for services as agreed upon or according to our then current Schedule of Charges if there is no other written agreement as to price. An estimated cost is not a firm figure. You agree to pay all sales taxes and other taxes based on your payment of our compensation. Our performance is subject to credit approval and payment of any specked retainer. 4.2 You will notify us of billing disputes within 15 days. You will pay undisputed portions of invoices on receipt. You agree to pay interest on unpaid balances beginning 30 days after invoice dates at the rate of 1.5% per month, or at the maximum rate allowed by law. 4.3 If you direct us to invoice another, we will do so, but you agree to be responsible for our compensation unless you provide us with that person's written acceptance of all terms of our ! ~ Agreement and we agree to extend credit to that person and to release you. 4.4 You agree to compensate us in accordance with our fee schedule if we are asked or required to respond to legal process arising out of a proceeding related to the project and as to which we are not a party. 4.5 If we are delayed by factors beyond our control, ar if project conditions or the scope or amount of work change, or if changed labor union conditions result in increased costs, decreased efficiency, or delays, nr if the standards or methods change, we will give you timely notice and we will receive an equitable adjustment of our compensation. ff you and we do not reach agreement on such compensation within 30 days of our written application, we may [ertninate without Lability to you or others. 4.6 If you fail to pay us within 60 days following invoice date, we may consider the default a total breach of our Agreement and, at our option, terminate our duties without Lability to you or to others. 4.7 In consideration of our providing insurance to cover claims made by you, you ereby waive any right of offset as to fees ~therwise due us. Section 5: Disputes, Damage, aad Risk Allocation 5.1 Bach of us will exercise goad faith efforts to resolve disputes without litigation. Such efforts will include, but not be limited ta, a meeting(s) attended by each party's representative(s) empowered to resolve the dispute. Before either of us commences an action against the other, disputes (except collections) will be submitted to mediation. 5.2 Neither of us will be liable for special, incidental, consequential, or punitive damages, including but not limited to those arising from delay, loss of use, loss of profits or revenue, loss of financing commitments or fees, or the cost of capital. 5.3 We will not be liable for damages unless suit is commenced within two years of the date of injury or loss or within two years of the date of the completion of our services, whichever is earlier. We will not be Gable unless you have notified us of the discovery of the claimed breach of contract, negligent act, or omission within 30 days of the date of discovery and unless you have given us an opportunity to investigate and to reconunend ways of mitigating damages. 5.4 For you to obtain the benefit of a fee which includes a reasonable allowance for risks, you agree that our aggregate Liability will not exceed the fee paid for our services or 550,000, whichever is greater, and you agree to indemnify us from all Lability to others in excess of that amount. )f you are unwilling to accept this allocation of risk, we will increase our aggregate liability to $100,000 provided that, within 10 days of the date of our Agreement, you provide payment in an amount that will increase our fees by ]0%, but not less than $500, to compensate us for the greater risk undertaken. This increased fee is not the purchase of insurance. 5.5 if you do not pay us within 60 days of invoice date, or if you make a claim against us that is resolved in our favor, you agree to reimburse our expenses, including but not limited to attorney fees, staff time, expert witness fees, and other costs of coLection or litigation. 5.6 The law of the state in which our servicing office is located will govern all disputes. Each of us waives trial by jury. No employee acting within the scope of employment shall have individual Lability for his or her acts or omissions, and you agree not make a claim against individual employees. Section 6: General IndemrtiGcatian 6.1 We will indemnify and hold you harmless from and against demands, damages, and expenses to the comparative extent they are caused by our negligent acts or omissions or those negligent acts or omissions of persons for whom we are legally responsible. You will indemnify and hold us harmless from and against demands, damages, and expenses to the comparative extent they are caused by your negligent acts or omissions or those negligent acts or omissions of persons for whom you are legally responsible. 6.2 To the extent it may be necessary to indemnify either of us under Section 6.1, ypu and we expressly waive, in favor of the other only, any immunity or exemption from liability that exists under any worker compensation law. 6.3 You agree to indemnify us against lasses and costs arising out of claims of patent or copyright infringement as to any process or system that is specified or selected by you or by others on your behalf. Section 7: Miscellaneous Provisions 7.1 We will provide a certificate of insurance to you upon request. Any claim as an Additional Insured shall be limited to losses caused by our sole negligence. 7.2 This Agreement is our entire agreement. It supersedes prior agreements. It may be modified only in a writing, making specific reference to the provision modified. 7.3 Neither of us will assign or transfer any interest, any claim, any cause of action, or any right against the other. Neither of us will assign or otherwise transfer or encumber any proceeds ox expected proceeds or compensation From the project or project claims to any third person, whether directly or as collateral or otherwise. 7.4 Our Agreement may be terminated early only in writing. We will receive an equitable adjustment of our compensation in the event of early termination. Revised 6-15-06 Page 2 of 2 GC . HRA Agenda - 11/07/p7 6. Consideration to ado t a resolution relatin to the transfer of HRA ra'ect and ro rarns to the Ci of Monticello Economic Develo went Authori A. Reference and back round: On October 22, 2007, the City Council held a public hearing for the purpose of consolidating the Housing and Redevelopment Authority (HRA) and the Economic Development Authority (EDA). After hearing no public comments and following discussion by Council members, the council closed the public hearing and adopted two resolutions. The first resolution (the "Allocation Resolution") simply stated the City Council transferred the control, authority, and operation of all "projects" and other programs and projects of the HRA to the EDA, conditioned upon the acceptance by the EDA of such transfers. The second resolution amended and restated the "Enabling Ordinance" approved April 10, 1989, incorporating the transfer of the HRA powers to the EDA in accordance with the Allocation Resolution. Within the second resolution the Council approved an EDA composed of aseven-member commission consisting of two members of the City Council and five non-City Council members. The Council also elected to include aresidency/non-residency section within the amended and restated "Enabling Ordinance". "At least three of the members who are not members of the City Council shall be residents of the City, and not more than two of the members who are not members of the City Council maybe nonresidents of the City, provided that such members own a business and own property in the City." Before the HRA, is the HRA resolution for adoption. The resolution states the HRA finds and determines that it is in the best interests of the proper administration of the affairs of the HRA, the EDA, and City that appropriate steps be taken to effect the transfer of all projects and programs of the HRA to the EDA complying with the terms of the Council action. A. The HRA will transfer all outstanding contracts listed in Exhibit A and any contractual obligations not listed. B. The HRA transfers any activities of the Transformation Home Loan Program including interest and obligations, Exhibit B. C. All parcels of real property presently owned in fee by the HRA are sold and transferred to the EDA without consideration and directs the Chair and Executive Director to execute and deliver quit claim deeds. Exhibit C. r 1 LJ . HRA Agenda - 11/07/07 D. List all bonded indebtedness issued by the HRA and outstanding as of this date. Exhibit D. E. The HRA assigns and transfers to the EDA, and releases all claims to any and all funds in its possession or while in the process. F. The supervision and control of all employees of the HRA be placed under the supervision and control of the EDA and far the supervision to follow through with appropriate certifications, filings and notifications. Please review the attached resolution for discussion or questions and thereafter proceed to take action. An update of the consolidation process is included in the Executive Report Item. 8. B. Alternative Actions: A motion to adopt the resolution relating to the transfer of HRA project and programs to the City of Monticello Economic Development Authority. 2. A motion to deny adoption of the resolution relating to the transfer of HRA project and programs to the City of Monticello Economic Development Authority. 3. A motion to table any action. C. Recornrnendation. Given the City Council's action of October 22, 2007, and the agreement among the Council, City Administrator, and HRA Executive Director that the consolidation of the HRA and EDA will integrate City Council's members into the city's economic development process and stream-line the process far applicants seeking public assistance; the recommendation is Alternative No. 1. D. Sup op rtin~ Data• Resolution for adoption. • • HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO RESOLUTION NO. RESOLUTION RELATING TO THE TRANSFER OF HRA PROJECTS AND PROGRAMS TO THE CTI"Y OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY BE IT RESOLVED by the Housing and Redevelopment Authority in and for the City of Monticello, Minnesota ("HRA"): Section 1. Background. 1.01. Pursuant to authority granted by Minnesota Statutes, Chapter 469 (the "Act"), the City Council of the City of Monticello, Minnesota (the "City") adopted Ordinance No. 172, codified as Title II, Chapter 3 of the City Code (the "Enabling Ordinance"), creating the City of Monticello Economic Development Authority (the "EDA") on April 10, 1989. 1.02. On October 22, 2007, the City Council adopted Resolution No. (the "Enabling Resolution"), amending and restating the Enabling Ordinance. The Enabling Resolution confers upon the EDA all of the powers and duties of a housing and redevelopment authority under Sections 469.001 to 469.047 of the Act. 1.03. By Resolution ,the City has transferred all projects and programs of the HRA to the EDA. At its organizational meeting on , 2007, the EDA is expected to accept such transfer and to pledge and covenant to assume all of the duties and responsibilities of the HRA with respect to every project and program. 1.04. The HRA finds and determines that it is in the best interests of the proper administration of the affairs of the HRA, the EDA and the City that appropriate steps be taken to effect the transfer of all projects and programs of the HRA to the EDA hereby complying with the terms of the Enabling Resolution and the Act. Section 2. Transfer. 2.01. Attached as Exhibit A is a list of all outstanding contracts to which the HRA is a party. The rights, duties and obligations of each of the contracts listed in Exhibit A are transferred, assigned and released, without qualification, to the EDA. Any contractual obligation of the HRA not listed in Exhibit A is similarly transferred, assigned and released to the EDA. 2.02. Attached as Exhibit B is a list of activities of the HRA conducted as part of its "Transformation Horne Loan" Program. All of the HRA's interest in and duties and obligations heretofore exercised in the activities listed in Exhibit B are transferred, assigned and released to the EDA. 2.03. Attached as Exhibit C is a list of all pazcels of real property presently owned in fee 322303v3 MN[ MN190-130 by the HRA. In order to comply with the Enabling Resolution and the Act, the parcels of real property listed in Exhibit C are sold and transferred to the EDA without consideration. The Chair and Executive Director of the HRA are authorized and directed to execute and deliver quit claim deeds for each parcel conveying all of the HRA's interest in each parcel listed in Exhibit C to the EDA, together with such other documents and certificates that are necessary to effect such conveyances. 2.04. Attached as Exhibit D is a list of all bonded indebtedness issued by the HRA and outstanding as of the date hereof. All of the HRA's obligations to pay principal and interest on the bands listed in Exhibit D are transferred, assigned and released to the EDA. 2.05. Except as provided in this section, the HRA assigns and transfers to the EDA, and releases all claims to any and all funds in its possession and all interest in and claims to moneys in the process of collection to the EDA. The Executive Director is authorized and directed to retain from such funds and moneys so transferred the amounts necessary to reimburse commissioners of the HRA for necessary expenses and meeting payments incurred to and including the date of this resolution and to pay such amounts to the commissioners entitled to those expenses and payments. Section 3. Miscellaneous. 3.01. It is the intent of the HRA in adopting this resolution that all of the HRA's interest, rights, duties, responsibilities and obligations in each and every HRA project and program, as contemplated by the Act, be effectively transferred to the EDA and that the supervision and control of all employees of the HRA be placed under the supervision and control of the EDA. 3.02. The Chair and Executive Director are authorized and directed to transmit a certified copy of this resolution to the President of the EDA, the Mayor of the City and the Minnesota Department of Trade and Economic Development and to transmit a certified copy of this resolution to the County Auditor and the County Recorder far filing in the appropriate xecords of Wright County. 3.03. The Chair and the Executive Director are authorized and directed to take appropriate actions to notify any and all parties to the contracts listed in Exhibit A, the participants to the program listed in Exhibit B, and the bondholders of the obligations listed in Exhibit D of the nature, intent and effect of this resolution. 3.04. This resolution is effective as of the date of acceptance by the EDA. Chair ATTEST: Executive Director 322303v3 MNI MN190-130 2 Exhibit A HRA Contracts Contract for Private Redevelopment by and between the Housing and Redevelopment Authority in and for the City of Monticello and Broadway Square Limited Partnership. June 7, 1989 Contract far Private Redevelopment by and between the Housing and Redevelopment Authority in and for the City of Monticello and Construction 5, Inc. March 16, 1987. Contract for Private Redevelopment by and between the Housing and Redevelopment Authority in and for the City of Monticello and Raindance Properties. November 12, 1985. Contract for Private Redevelopment by and among the Housing and Redevelopment Authority in and for the City of Monticello, the City of Monticello, Minnesota, and Presbyterian Homes Housing and Assisted Living, Inc. July 1, 1995. Contract for Private Redevelopment by and among the Housing and Redevelopment Authority in and for the City of Monticello, the City of Monticello, Minnesota, and Cedrus Creek Craftsman, Inc. July 3, 1996. Amendment to Contract for Private Redevelopment. June 23, 1997. Contract for Private Redevelopment by and between the Housing and Redevelopment Authority in and for the City of Monticello and BBF Properties, Inc. March 20, 1998. Contract for Private Redevelopment by and among the Housing and Redevelopment Authority in and for the City of Monticello, the City of Monticello, Minnesota, and Hans Hagen Homes, Inc. Apri122, 2002. Contract for Private Redevelopment by and between the Housing and Redevelopment Authority in and for the City of Monticello and Masters Fifth Avenue, Inc. September 18, 2001. First Amendment to Contract for Private Redevelopment. February 6, 2002. Contract for Private Redevelopment by and between the Housing and Redevelopment Authority in and for the City of Monticello and St. Cloud Hospital. October 2, 1998. Lease-Purchase Agreement and Ground Lease by and between the Housing and Redevelopment Authority in and for the City of Monticello and the City of Monticello, dated as of December 1, 1998. Amendment No. 1 to Lease-Purchase Agreement and Ground Lease, March 1, 2000. Contract for Private Redevelopment by and among the Housing and Redevelopment Authority in and for the City of Monticello, the City of Monticello, Minnesota, and Twin City Die Castings Company. October 25, 1999. 322303v3 MNI MN190-130 A-1 Contract For Private Redevelopment by and among the Housing and Redevelopment Authority in and for the City of Monticello, the City of Monticello, Minnesota, and Integrated Recycling Technologies Corporation. June 11, 2001. Contract for Private Development by and among the Housing and Redevelopment Authority in and for the City of Monticello, the City of Monticello, Minnesota, and Front Porch Associates, LTD. May 1, 2002. First Amendment to Contract for Private Development. January 13, 2003. Assignment of Contract for Private Development. April 24, 2002. Contract for Private Development by and among the Housing and Redevelopment Authority in and for the City of Monticello, the City of Monticello, Minnesota, and Central Minnesota Single Family Housing, LLC. June 25, 2002. Contract for Private Development by and among the Housing and Redevelopment Authority in and for the City of Monticello, the City of Monticello, Minnesota, and Terrance & Mary Tamann Family Limited Partnership. August 26, 2002. Contract for Private Development by and between the Housing and Redevelopment Authority in and for the City of Monticello and Topper's Holdings, LLC and Strategic Equipment and Supply Corporation. February 15, 2005. Tax Increment Pledge Agreement by and between City of Monticello, Minnesota and the Housing and Redevelopment Authority in and for the City of Monticello, Minnesota. August 17, 2005. (No Contract between City and HRA for Interchange Project) Contract for Private Development by and among the Housing and Redevelopment Authority in and for the City of Monticello and Masters Fifth Avenue, Inc. September 7, 2005. Amendment to Contract for Private Development. June 7, 2006. Purchase and Redevelopment Contract by and between Housing and Redevelopment Authority in and for the City of Monticello and Rocky MTN Group, LLC. September 2, 2005. Purchase and Redevelopment Contract by and between Housing and Redevelopment Authority in and for the City of Monticello and SL Real Estate Holding's, LLC. April l2, 2006. Purchase and Redevelopment Contract by and between Housing and Redevelopment Authority in and for the City of Monticello and WRE, LLC. April l 1, 2007. 322303v3 MNI MN190-130 [~-2 Exhibit B Transformation Home Loan Program 1. Second Mortgage to Housing and Redevelopment Authority in and for the City of Monticello, Borrower, Keith B. Peterson and Jacquelyn J. Peterson. $19,846.00 June 27, 2006. Promissory Note. $19,846.00 June 27.2006. Request for Payment and Certification as to Costs, April 5, 2005. 2. Transformation Home Loan Escrow Agreement by and between Antoinette Breiwick and Ronald Ruff, Quality Title, Inc. and Housing and Redevelopment Authority in and for the City of Monticello. May 18, 2006. Promissory Note. $20,000.00. May 18, 2006. Second Mortgage to Housing and Redevelopment Authority in and for the City of Monticello. Borrowers, Antoinette Breiwick and Ronald Ruff. $20,000.00 May 18, 2006. 3. Transformation Home Loan Escrow Agreement by and between Felicia L. Whitmore, . First Minnesota Bank, and the Housing and Redevelopment Authority in and far the City of Monticello. September 27, 2007. Promissory Note. $9,581.00. September 27, 2007. Request far Payment and Certification as to Casts. September 12, 2007. Third Mortgage to Hauling and Redevelapment Authority in and for the City of Monticello. Borrower, Felicia L. Whitmore. $9,581.00 September 27, 2007. • 322303v3 MN[ MN190-130 B_ 1 Exhibit C HRA Real Property Lots 1, 2, 3, 4 & 5 Block B, Original Plat, City of Monticello 155-010-067010 Lots b, 7, 8 and 9 Block B, Original Plat, City of Monticello 155-010-067060 Outlat A, Country Club Manor, City of Monticello 155-033-000010 South 1/2 of Lots 1 and 2, Block 54, City of Monticello Lots 7 and 8, Block 52, Monticello according to recorded plat thereof, except the Southeasterly 16.5 feet of the Southwesterly 90.00 feet of said Lat 8 as measured at a right angle to and parallel with the Southeasterly and Southwesterly lines thereof. Together with an easement for sanitary sewer and water lines under the Southeasterly 16.50 feet of the Southwesterly 90.00 feet of Lot 8, Block 52, Monticello as measured at a right angle to and parallel with the Southeasterly and Southwesterly lines thereof. Subject to a staircase easement for ingress and egress purposes across the Northwesterly 4.50 feet of the Southeasterly 21.00 feet of the Southwesterly 24.50 feet of Lot 8, Black 52, Monticello as measured at a right angle to and parallel with the Southeasterly and Southwesterly lines thereof. • 322303v3 MNI MN190-130 C-1 Exhibit D Bonded Indebtedness of the HR.A General Obligation Tax Incremcnt Bond of 2004A: outstanding principal of $780,000. • r~ 322303v3 MNI MN190-L30 D-1 HRA Agenda - 1 ~ /07/07 7. Consideration to authorize a meet of HRA bills. This is the only invoice received; however, legal invoices are forthcoming for the preparation of the documents associated with the Whitemore Transformation Home Loan closing. • r~ ~~ FIRST MINNESOTA BANK 1881- 2006 raditlon of Service Since 7881 Minnetonka 4625 County Road 101 Minnetonka, MN 55435 952.933.9550 Edina 4018 West 65th Street Suite 150 Edina, MN 55435 952.926.6000 Champlin 11431 Jefferson Court N. Champlin, MN 55316 763.488.1568 Monticello 106 East 4th Street Monticello, MN 55362 763.271.7200 Buffalo 555 Highway 55 East E3~, MN 55313 76 2.0555 Waconia Loan Production Office 44 West 1st Street Waconia, MN 55387 952.442.9940 Mayer 101 Ash Avenue North Mayer, MN 55360 952.657.2500 Glencoe 606 East 11th Street Glencoe, MN 55336 320.864.3161 W utchinson 308 Main Street South Hutchinson, MN 55350 320.587.8800 Stewart 737 Hall Street Stewart, MN 55385 322.2553 - _~Sth October 2, 2007 Ollie Koropchak City of Monticello 505 Walnut Street Ste 1 Monticello, MN SS362 Dear Ollie: On today's date we filed a mortgage for the City of Monticello and The Housing and Redevelopment Authority regarding Felicia Whitmore. The following are the fees due to First Minnesota Bank: Recording Mortgage -Wright County $ 4b.00 Ag Fee -Wright County 5.00 Mortgage Registration Tax -Wright Co. 22.08 Total Due $ 73.08 If you have any questions, please contact me. Sincerely, Cory Nuest Vice President CNlby ~~, ~~~ -~ ~c;~ f~ ~'\ ~~ ~.\~ ~ ~i ~~ -~ ~. ~~ ~ ~. ~ ~/ ~ ~ .~ r ~~ ~~ 8. Consideration of HRA Executive Re ort: HRA Agenda - 11/07/07 a) Transformation Home Loan No. 3 -September 27, 2007 was the closing date far this rehabilitation loan for the property located at 312 East River Street. The HRA is in third position behind JP Margan/Chase and First Minnesota Bank. First Minnesota serves as the escrow agent. b) Transformation Home Loan No. 2 -Tom Scott, city attarney, wrote a letter (September ~, 2007) confirming the HRA had an infinite extension of time to answer the summons. The Metro Home Insulation, LLC vs. Antoinette Breiwick, et. al., Court File. The HRA was named in the summons. October 30, 2007, follow-up with Scott - no further action required by HRA, Complaint's attorney trying to settle $3,975 outside court. c) Subordination Agreement between the HRA and KleinBank, September 10, 2007. - The Executive Director executed a Subordination Agreement at the request from Rocky Mtn Group, LLC. and Mayor Herbst. The HRA attarney did manage to review the original prepared agreement which was amended to include a clause to protect the HRA in case of default prior to execution. d) Consolidation of HRA/EDA update - A letter was prepared and mailed to the four existing commissioners as of their interest to be considered for appointment to the new EDA. Three of the four commissioners have responded. Thereafter, an ad will be placed in the Times and • Shopper and on the city web site, advertising for two or three commissioners based on the residency/non residency requirement. Individuals have expressed interest to serve on the EDA. The HRA Attorney recommends, but not a necessity, that the full seven-member commission be appointed prior to the EDA organizational meeting and acceptance of the HRA powers and assets. Once the EDA's action is completed, the City Council will conduct a reading of the "Amended and Restated Ordinance No. 172" at two consecutive Council meetings. e) Continuing Education Subcommittee -The next tentative date to meet is November 8. Tim Zipay of the Monticello Wark Force Center will present data on training/educational needs in the area. Koropchak will report on the Owatonna model. f) FiberNetMonticello -The name approved by the City Council for the fiber optic entity. Those on the finance/bond subcommittee are working with the appropriate professionals in preparation for sale of the bonds to finance the system consistent with the Feasibility Study. The marketing subcommittee is preparing a marketing plan as part of the documentation necessary for the bond sale. The head-in building subcommittee is identifying a site and alternate site for construction of the building in accordance to consultant recommendations. The city has an agreement with a provider connecting Monticello to the 511 building downtown Minneapolis -our fiber connection to the world. It is the intent to have the city hall connected by the end of 2007. g) Marketing committee -The new billboard along I-94 appeared October 1, 2007. The 1 HR.A Agenda -11/07/07 ticelloland.com web site is being updated. Plans are to advertise in the Minnesota Real mon hi li tin Wri t Estate Journal Year-End Edition and Staz Tribunae/dJ ertrnelin S~Cloud area and loo i g into and Sherburne Counties. Under consideration potential linkage with Metro Flan U date wasRdistribut d t the Council and Planning h) A draft copy of the Comp p Commission for review with the potential of a join the ne tgs ees nn the publ~c review process. December. Thereafter, the Council will determine p i) Leads -Local realtor inquired of industrial land for sale, south of 1-94 and east of Hwy 25 for BRE project. * Potential to build spec multi-tenant building for industrial users. Check back end of month. * Novozynes A/S - emailed this Danish company looking to expand in Midwest. * Washburn Computer Group - I need to check about pending contract for possible 30,000 sq ft expansion. EDA approved the loan, with loan document preparation upon notice. * Aware of two other Monticello Hsi Co~issionersowho volunteered over the years to j) Thanks to all the present and pa leasure. make Monticello a greater place to live and work. It's been my p k) Follow-up letter to Wolff s per HRA. • ~ ~~ September 13, 2007 James and Cheryl A. Wolff P.O. Box `n~a1..~ Buffalo, MN 55313-0664 Re: Property located at 101 Third Street East, Monticello, Minnesota Dear James and Cheryl: On September 12, 2007, The Housing and Redevelopment Authority (Authority) in and for the City of Monticello, Minnesota, considered your response dated September 5, 2007, in which you, as property owners, rejected the Authority's offer of $100,405. The Authority had no interest to pursue the property at the listed price of $549,000. The Commissioners "thank you" for responding and noted the Authority is open to consider an offer in the future. Should you have questions, please call me at 763-271-320$. Sincerely, HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO, MINNESOTA Ollie Koropchak Executive Director c: Authority File • Mi~~~i~y; `1~~-~~~o~§'h~'~~~~;~~i~ ~?9v-li~r~t1M~~~~~e~~~~1(~~~~~~~~~~1Fa~~~~~~~~so4 °~i~i~d~~~;~~'~~~~S~Ac~~4ir~stsr~~u,dY!~ti~tzN!~1~~~~e~Z~~~i~y~~-~~cF~~'~~~~~3y ~x~~~a~~z