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HRA Agenda 11-02-2005 . . . AGENDA MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY Wednesday, November 2,2005 - 6;()0 p.m. Bridge Room - Community Center Commissioners: Chair Darrin Lahr, Vice Chair Dan Frie, Steve Andrews, Brad Barger, and Bill Fair. Council Liaison: Wayne Mayer. Staff: Rick Wolfsteller, Ollie Koropchak, and Angela Shumann. I . Call to Ordcr. 2. Consideration to approve the October 5, 2005 liRA minutes. 3. Consideration of adding or removing items ti'om the agenda. 4. Consent Agenda. A. Consideration to approve ratification of the Amendment and Second Amendment of License Agreement between thc HRA, the City, and Rocky Mtn Group LLC. B. Consideration to approve Release of Contract for Private Redevelopment between the HRA and I3lue Chip Development Company. 5. Consideration to review proposal and approve hiring LJ-IB to commence preparation of a redevelopment inspection report tt)r proposed Redevelopment 1'1 F District No. 1-37. 6. Consideration to review and accept: A. Increase in fees by Elhers & Associates. R. Revisions to the Preliminary Development Agreements 7. Consideration to authorize payment of HRA bills. 8. Consideration of HRA Executive Report. 9. Committee Reports: Marketing Fiber Optic 10. Next HRA meeting - Wednesday, December 7,2005. II. Adjournment. - . MINUTES MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY Wednesday, October 5th, 2005 50S Walnut Street - Bridge Room Commissioners Present: Steve Andrews, Bill Fair, Darrin Lahr, and Dan Frie Commissioners Absent: Brad Barger Council Liaison Present: Wayne Mayer Staff Present: Rick Wolf<;teller, Ollie Koropchak, and Angela Schumann. I. Call to Order. Chairman Lahr ealled the meeting to order at 6:00 PM and deelared a quorum. 2. Consideration to approve the September ih and September 261h, 2005 HRA meeting minutes. . MOTION BY COMMISSIONER FAIR TO APPROVE THE MINUTES OF THE lIRA MEETING OF SEPTEMRER ih and September 261\ 2005. MOTION SECONDED BY COMMISSIONER ANDREWS. MOTION CARRIED. 3. Consideration of adding or removing items from the al!:enda. Koropchak added as item Sa an update on the Landmark Square II project. 4. Consideration to hear a concept presentation for potential redevelopment of Block 35 and consideration to approve entering into a Preliminary Development Agreement with APM. Koropchak introduced Mike Van Heel of Allied Property Management) and Steven Mosborg of SunTide Development. They are present representing a possible Block 53 redevelopment. The development group has held several meetings with City staff regarding proposed concepts. At this time, they are interested in proceeding with a proposal. . Koropchak stated that in that regard, the HRA could consider authorizing a prel iminary agreement. HRA Minutes 10/05/2005 . Michael Van Heel addressed the HRA, indicating that Allied Property owns the Worktl)fee Building in Monticello, as well as other commercial property in the metro area. Van Heel stated that with Muller Theater leaving, there was an opportunity to reevaluate the sitefor redevelopment. Steven Mosborg stated Allied controls 1/3 of the parking are and the Work Force building. Mosborg got involved when the Muller Theater came up for sale. After the first meeting with staff, it seemed to make more sense to involve the whole block, especially in light on parking issues. Mosborg stated that they had several concept plans drawn in order to work with the City on a suitable concept. Mosborg noted the present conditions of the buildings on the block and noted that tenants had outgrown current spaces. Mosborg referred to the plan ineluded in the HRA packets and stated that they already have two interested tenants. Mosborg noted that Jeff O'Neill has asked them to re-analyzc thc parking shown on the plan as it appears short of the required parking. Mosborg stated that they have met the Mayor who indicated that if they wanted to close River Strcet and build on it, he would not object. However, Mosborg stated that thcy would rather do a choke down the strect to eliminate the trafTic, and makc it more diHicult to use as a go around. . Fair asked if the project would be phased. Mosborg stated that because of existing owners, there should not bc a need to phase. He statcd if they do phase, there would be an '06 and '07 phase. Most likely, thc dcvclopment would all happen at the samc time. Lahr asked about the purpose of the large housing lobby. Mosborg replied that it is the community area for the condo area. Mosborg stated they wanted to be proactive in their purchasing and they do have willing scllers. I Ie indicated that SunTide has had purchase agreements discussions with cveryone on the property owncr list provided to the fIRA. The list represents the order SunTide prefers to purchase properties. In tcrms of City commitment, Mosborg statcd that SunTide had provided the HRA with a top line budget and an estimated project cost of 25 million. The total valuation ycar-end was projected at $18-19 million. Mosborg stated that SunTidc estimates it needs $6.4 million of TIF, amortized over a 25 ycar window. He indicated that is what SunTide believes would be needed for a straight market deal, without condemnation. L,ahr notcd that cooperative sellers will be key. Mosborg commented that condemnation in Monticello has not been the procedure of choice. Mosborg referenced the Cedar Street garden center as a property that the City may want to consider purchasing for parking, as it is a centralized location. Mosborg stated that they will addrcss the parking issue. Lahr recommended highly that they look into providing adequate parking, as it is always an issuc. . 2 I IRA Minutes 10/05/2005 . Mosborg stated that the next step is to take the steps as outlined in City timelines. If SunTide can keep this process moving along, groundbreaking would be sometime 1fom April to June. Van lIeel inquired ifupon signing the preliminary developmcnt agreement, it would trigger the use of consultants. Koropchak confirmed. Koropchak stated that contingent on the II RA' s action, it is recommended that SunTide representatives meet with the HRA's attorney and Ehlers. Koropchak stated those two parties want to make sure the timing of acquisition meshes with TTF requirement and relate concerns regarding relocation. Mosborg stated that he would makc themselves available for that meeting. Lahr asked ifthere are relocation issues. Mosborg stated that there are two pieces to protect, willing sellers and month-to-month leases. The longest least is the State. The second is Bremer Hank. . Mayer asked about utilities, noting that River Street ineludes City utilities. If SunTide builds over them, it becomes a liability. Mayer stated that there have been discussions and concerns about thc River Street signal light. Mayer stated that it seems that the I ight is the culprit of traffic backing up and there has been Council conversation about eliminating the light. Mosborg stated that the market may require the access points at River Street. Mayer indicated that Council would be disappointed in the possibility of keeping it open. Fair noted that previously, local residents did not want the light to go. Mosborg asked if it would be a City or MnDOT decision. Fair stated MnDOT probably wouldn't have an objection to it going. Koropchak noted the light does serve Front Street traffic. Fair noted that while it may be a bad intersection, he doesn't know if Council wants to fight the battle and lose the project. Mosborg stated thc choke down could be the compromise that works. People will think twice about River being a faster route. Lahr asked what the Council's concern is, in terms of the benefit of closing River. Mayer responded that that the congestion in that area would easc, if the lights weren't there. . Koropchak noted that she did call LHB, who will do the inspection for property qualification. Their schedule for inspection would probably be mid-November with a written report in January. Koropchak explained that the HRA hires the inspection firm, but the developer pays for it. Mosborg stated that itcm was relative to Van Hecl's comments. Mosborg stated thcy may want to mect with LHB. Van I Ieel asked why the inspection was needed. Fair responded that it had to do with the statutory responsibility, as the properties have to meet a test of substandard to qualify so that the assistance can be granted. Lahr noted that there 3 lIRA Minutes 10/05/2005 . arc not many firms who do the analysis, which is fi:mnulaic. Koropehak noted that they do a thorough inspection with a coverage test. Mosborg stated that it will require thc TIF money to work, so it is elear that we have to do it. Koropchak recommcnded moving forward with the preliminary agrcement, with a few rcvisions and submission of the deposit. MOTION BY COMMISSIONER ANDREWS TO ACCEPT THE PRELIMINARY CONCEPT FOR REDEVELOPMENT OF BLOCK 53 AND TO APPROVE ENTERING INTO THE PRELIMINARY DEVELOPMENT AGREEMETN WITH APM. MOTION SECONDED BY COMMISSIONER FAIR. MUrtON CARRIED. . Fair asked about how critical exposurc on Highway 25 is in tcrms of this project and future projects. Moshorg statcd that Highway 25 cxposurc is important to somc and not other. Mosborg stated that the anchor tenants would bc the State, the drug storc and the bank. Fric asked whether they had considered a right turn lanc due to the commutcr tra1Tic How. Koropchak noted that the interchange and the extension of ill Street wi II al so case some of the traffi c in thc arca. 5. Consideration of approvc a resolution adopting thc modification to the Redevelopment Plan for Central Monticello Redevelopment Proicct No. I and establishmcnt of Redevelopment TIF District No. 1-35 and its Plan thereto. Koropchak reported that the Planning Commission meeting had recommended denial ofthc rczoning ofthc Ottcr Creek Industrial arca in a 5-0 vote. She eXplained that a number of people had spokc in opposition to the rezoning at the public hcaring. Fair notcd that the City itself was thc applicant and asked where it goes from here. Fair asked ifthc liRA should develop a position. Koropchak stated that her understanding is that thcre is no public hearing at the Council. It will bc on the regular agenda. Whether the Mayor allows people to comment, I do not know. She stated that whethcr the 11RA would like to make comment is their decision. Fair stated that Koropchak made some strong arguments on economic impact, and stated that long-range he doesn't see the henefit of the proposed rezoning and use. Fair asked other Commissioners how thcy would like to proceed. Maycr encouraged the Commissioner to provide their opinion on the rezoning. . 4 BRA Minutes 10/05/2005 . Koropchak stated that for those that didn't see the meeting, her recommendation was to dcny the request. Lahr stated that his personal feeling is that they can find a different site, but in that case, the City will be responsible to pay to get them out. In any case, Lahr stated that using the industrial park land for that purpose is not a good long-term decision. He noted the amount of proposed and existing residential use in the area and notcd that once it is thcrc, it's not going to go anywhere. Lahr noted that the city will grow up around it. I think we should pay the relocation costs and move on. Fair asked if A VR is doing their own property seareh. Mayer statcd that hc did not believe so. Fair stated that after the City and A VR have settled, they can take the cash, and put up the cement plant wherever they'd like. . Mayer stated his concern is at what cost is the City willing to gamble if it does go to court. Frie asked if there was a precedent set in other similar cases. Mayer stated that it could be in the range of $5-1 0 mill ion. Lahr asked how far off that is from what was budgeted for relocation. Mayer stated $3.4 million was budgeted. Mayer c1arificd that it is Fair's opinion to fight the going concern claim. Fair pointed out that A VR hasn't even tricd to find an alternate site and noted that thcy arc not cvcn currcntly in thc City. Frie asked if there wcrc other locations available in the township. He noted that although it would be nice to have a place for them, the industrial park was intended for other purposes. There should be othcr options. Lahr noted that the City will always try to find a site. Mayer noted that thcy havc gone through this process beforc. The trade-off is either the City will pay in cash or in long terms changes to the City. Fair stated that anytime the City gets into these large projects, there will be hiddcn costs, but the long-range vision is that thc high quality industrial and business park is what we wantcd to accomplish. Andrews stated that he has had a ditlicult timc with this. He noted that if it is located in the City-owned industrial park, then at least there is an oppOliunity to control how itis built. lIe stated that he has spoken with Rogcr Carlson about this. Carlson cXplaincd that they can put the tanks undcrground, storage underground, and that the sites are clean. Fair noted that those items don't impact the 120 trucks in the area. Andrcws agrced, but noted there are ways to control access points and ingress and egrcss. Frie noted that it is a financial dccision. He stated that if it was going to be a 10 million dollar tax burdcn, it would be dinicult to justify. Fric indicated he would need more information before giving a final opinion. . Fair asked when the City would know about potential cost from a court perspective. Mayer stated that thc rezoning is a way for the judgc to look at thc 5 HRA Minutes 10/05/2005 . entire case, with the rezone contingent for specific purpose. Frie noted that from a zoning standpoint, it is hard to justify this use. Mayer stated that details on an offer package had been conveyed by City Attorney Tom Scott to A YR. Koropehak noted that the City had met with A YR. It was a decision to take the rezoning to the Planning Commission as part of this negotiation. Koropchak stated her reco111mendation was made strictly from a land use decision. Koropchak indicated that this area may well be the center of the City in the future. She noted that this use is not consistent with any other proposed use under the criteria and covenants. Koropchak also explained that the Planning Commission has spent a year trying to deal with con11iets between industrial and residential or commercial uses in Oakwood. This creates the same problem in a new area. Lahr stated at the some point, the City has to step up and stick with the plan. Monticello has to be confident that it is different. I think this is one of those points, where they City identifies what it wants to be when it grows up. Mayer noted that A VR has been the stickler since the interchange project started. It was such a problem that the project almost didn't proceed. Mayer stated that he appreciated the comments of the Commissioners and noted that it would be a tough decision. . Lahr asked about action of a recommendation on this matter. Koropchak stated it is up to the HRA to take a position. Mayer noted that the question was asked of the IDC, who had decided not to give a formal recommendation. He recommended that those with strong opinions should voice them to the Council. FAIR MADE A MOTION TO EXPRESS TO THE COUNCIL THAT TilE PROPOSED REZONING OF A PORTION OF TIIE OTTER CREEK INDUSTRIAL PARK DOES NOT COMPLY WITH THE LONG RANGE PLANS OF TilE CITY AND TO RECOMMEND TO TilE COUNCIL DENY THE REQUEST. MOTION SECONDED BY COMMISSIONER LAHR. MOTION CARRIED 2- 1, WITH COMMISSIONER ANDREWS IN DISSENT AND COMMISSION FRIE ABSTAINING. hie explained that he would like to see the City find alternatives. lie stated that without more information, it is ditlicult to take a position. . Koropchak noted that Barger had conveyed that he is not in favor of the rezoning. 6. Consideration to authorize payment of lIRA bills. . Fair asked if the relocation of the dirt stockpile in Otter Creek came in under estimate. Koropchak confirmed. 6 lIRA Minutcs 10/05/2005 . MOTION BY COMMISSIONER FAIR TO AUTHORIZE PAYMENT Of HRA BILLS. MOTION SECONDED BY COMMISSIONER fRIE. MOTION CARRIED. 7. Consideration of the Executive Direetor's Report. . a. Landmark Square: Koropchak reported that she had spoken with Brad Johnson, who had asked her to speak on their behalf on the development agrecmcnt. Fluth wanted to know about the timing of thc rclease of thc $20,000 the agreement authorized f(J[ acquiring the Koppy garage. Koropchak stated that thc contract was written that the developer gets the money when the improvements arc done for thc projcct. Thc dcfinition of "complete" is when the houses are gone and the o11ice is complete and parking lot is in. In addition, Koppy's garage demolition and surfacing also has to bc completc. Koropchak explained that whilc thc dcveloper could gct a ccrtificate of occupancy on the 11,000 building, the contract does not authorize release of the $20,000 until cverything is done and there is a certificate of completion. fluth would like the $20,000 once thc garagc is demolishcd and parking improvements are in. Lahr askcd ifthcrc is a risk to thc lIRA. Fair statcd that the matter is really just timing. Koropchak noted that the HRA would also then be agreeable to the fact that the parking improvements for Landmark Square I are enhanced without complction of Landmark Square II. MOTION BY COMMISSION FAIR '1'0 AMEND THE CONTRACT APROYING DISBURSEMENT Of THE $20,000 UPON COMPLETION AND EVIDENCE OF PAYMENT FOR ACQUISITION, DEMOLITION AND PUBLIC IMPROVEMENTS ASSOCIATED WITH THE KOPPY GARAGE. MOTION SECONDED BY COMMISSIONER FlUE. MOTION CARRIED, 4-0. In the balance of hcr report, Koropchak stated that Dahlheimer's has footings in. She also noted that the first transf'(mnation home loan is expected to close soon. Koropchak stated that the fiber optics task forcc was preparing a request for proposal. Shc notcd the letter from thc Statc Auditor relative to questions on the 2003/2004 TlF reports. . 7 BRA Minutes 101OS/200S . 8. Committee Reports: None. 9. Other Business Koropchak rcported that she had prepared a list of qualified leads for a targeted postcard Illailing rcgarding thc business park. 10. Adiournment MOTION BY COMMISSIONER FAIR TO ADJOURN AT 7:30 PM. MOTION SECONDED BY COMMISSIONER LAI-IR. MOTION CARRIED UNANIMOUSL Y. --"-'-,._"_.,---~-,-----._,-,._,-,-~ Secretary . . 8 . . . 4A. HRA Agenda - 11/02/05 Consideration to ratify the Amendment and Second Amendment to License Aereement between the HRA. the City. and Rockv Mtn Group LLC. A. Reference and backeround: The HRA is asked to ratify the Amendment to License Agreement between the HRA, the City, and Rocky Mtn Group LLC which was executed by all parties on October 14,2005. The HRA, the City, and Rocky Mtn Group LLC (the "redeveloper") entered into a License Agreement on September 26, 2005, allowing the redeveloper early entry to Lot 1, Block 1, Otter Creek Crossing 1 sl Addition for the purpose of final grading and installation of footings. It was anticipated the closing date would occur on or before October 14,2005, conveying the Otter Creek Crossing property from the City to the HRA to the redeveloper. Based on the title commitment, there are a number of title issues which need to be resolved and the redeveloper's attorney and the HRA Attorney are working to resolve these issues. The plat was recorded on September 28,2005. The Amendment to the License Agreement simply extends the termination date ofthe Agreement from October 14 to October 31, 2005 and allows construction of structural walls and roofing of the minimum improvements as described within the Contract. This is more or less a housekeeping item and eliminates default by the redeveloper. Second Amendment. The I IRA Attorney just informed me of the need for a Second Amendment as the title issues are not resolved. Dahlheimer's are conducting a survey of their 8.6 acres of land in hopes most of the title objections don't apply to their property. Therefore for the need of the Second Amendment. They anticipate the survey and title issues to be resolved and to close November 7,2005, the proposed "termination date." I asked the liRA Attorney to researeh the title insuranee policy prepared for the closing of the 35 acres from Chadwick to the City and why these items weren't taken care of and to clear them up prior to the next land transaction. One of the purpose of the city owned-land was to provide the applicant with a smooth purchase and conveyance process. B. Alternative Action: 1. A motion to approve ratifying the Amendment and Second Amendment to License Agreement between the HRA, the City, and Rocky Mtn Group LLC HRA Agenda - 11/02/05 . 2. A motion to deny approval ratifying the Amendment and Second Amendment to License Agreement between the HRA, the City, and Rocky Mtn Group LLC. " .J. A motion to table any action. c. Recommendation. The City Administrator and Economic Development Director recommend alternative no. I as this is a housekeeping item and allows the redeveloper to proceed with construction without default of the Contract. D. Supportinl! Data: Copy of the Amendment and Second Amendment to License Agreement. . . 2 . . . AMENDMENT TO LICENSE AGREEMENT This Amendment to License Agreement entered into \~ day of October, 2005, by and between HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO, a public body corporate and politic under the laws of Minnesota (the "Authority"), the City of Monticello, a Minnesota municipal corporation (the "City") and ROCKY MTN GROUP, LLC, a Milmesota limited liability company ("Redeveloper"). RECITALS WHEREAS, the Authority and Redeveloper entered into a Purchase and Redevelopment Contract dated as of September 2, 2005 (the "Contract"), under which the Authority agreed to convey to Redeveloper cC11ain property described in the Contract as the Redevelopment Property; and WHEREAS, Authority, City and Developer entered into a License Agreement dated as of September 26, 2005 (the "Licensc Agreement"), under which Redeveloper is grantcd the right to enter upon thc Redevelopment Property prior to transfer of title of the Redevelopment Property to Redeveloper in order to commence site improvements on that property; and WHEREAS, due to title issues recently discovered in that certain Commitment for Title Insurance File No. 25669 First Supplemental issued by Commercial Partners Title, LLC, the closing for the Redevelopment Property will need to be dclayed; and WHEREAS, the Redeveloper will need to extend the termination date of October 14, 2005 to October 31, 2005 as stated in Section 10 of the License Agreement and the City and Authority agree to the extension thereof; and WHEREAS, the Redeveloper wishes to extend the purpose of the early entry for final grading and installation of footings to installation of foundation, structural walls and roofing. NOW, THEREFORE, in consideration of the mutual covenants contained herein and othcr good and valuable consideration, the parties hereto agree that the Amendment to License Agreement is hereby amended as follows: 1. Extension of Time. The termination date under Section 10(b) of the License Agreement is extended to October 31, 2005; and the Closing date under the Contract, previously extended under Section 11 of the License Agreement, is extended to October 31, 2005. 2. Puroose of Earl v Entrv. The purposes ofthe early entry described in Section 1 of the License Agreement are extended to include construction of structural walIs and roofing of the. Minimum Improvements described in .the Contract. 3. No Other Changes. Except as specifically modified herein, the License Agreement shalI remain unchanged and in fulI force and effect. NKE-269(,20v I MN190.121 ;[30 IN WITNESS WHEREOF the undersigned have executed this instrument the day and date . first above written. HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR J'HE CITY \ OF MONTICELLO \ By (j~. ~cI\~~-D~ Its Executive Director . . . 2 sE.-3\ . . . CITY OF MONTICELLO By av JkLj a. . ' rCu1:.; Its City Adminis ator NKE-269620v I MN190-121 ~ '\ 5 E... --> cr . . . CONSENT OF INTERMEDIARY The undersigned, as assignee of Rocky Mtn Group, LLC under the Replacement Property Assignment Agreement dated September 6, 2005, consents to the foregoing Amendment License Agreement among the City of Monticello, the Housing and Redevelopment Authority in and for the City of Monticello and Rocky Mtn Group, LLC. Dated: ROCKY MTN EXCHANGE HOLDING COMPANY 25254, LLC By Its Chief Manager NKE-269620vl MN190-121 S E. - .~ \...\ . . . 4B. HRA Agenda - 11/02/05 Consideration to approve Release of Contract for Private Redevelopment between the HRA and Blue Chip Development. A. Reference and back~round: Mr. Kevin Weers, First National Bank of Elk River, called to inquirc about the recorded Contract for Private Redevelopment by and betwccn the Housing and Redcvclopmcnt Authority in and flX City of Monticcllo and Blue Chip Developmcnt Company dated October 5, 1998, filed October 19, 1998 as Doc. No. 658926. The propcrty described as the east 161.00 feet of Lot 5, I3\ock 3, Oakwood Industrial Park was dcvcloped for tenant, B&B Metal Stamping, resulting in job crcation and construction of a 12,000 sq ft facility. The $32,000 pay-as-you-go TIF reimbursement is paid to the developer, Bluc Chip, was fiJr public redevelopment costs. The Contract was recorded because thc rcimbursement goes to the developer and the facility is leased; thereforc, the restrictions of use is tied to the maturity date. Thc maturity datc of the Contract is February 1,2009. The job creation has bccn satisfied. On Octobcr 24,2005, the City Council approved thc final plat (re-plat) ofthc area. Blue Chip plans to construct a 25,000 sq ft manufacturing facility to the rcar lot described as Lot 3, Block 1, Chip Blue Development Addition. With the re-plat, Lot 2 consist of the B&B Metal Stamp building and Lot 1 will consist of the Vector '1'001 15,000 sq. ft. building. Thc dcvclopcr, Bluc Chip, has requested and will pay f'(Jr the HRA Attorncy to prepare the appropriate document. The BRA will be release the Contract from that portion of the legal description associated with Lot 3 only and the Contract and its restrictions of use remain with I,ot 2 as follows. "The redeveloper agrees that until thc maturity date to operate the minimum improvements at least 85%) of square footage for manufacturing, warehousing, or any combination of such activities..........." B. Alternative Action: 1 . A motion to approve the 2. A motion to deny 3. A motion to table. . HRA Agenda - 11/02/05 c. Recommendation: The City Administrator and Economic Development Director recommendation alternative no. I to encourage development of a 25,000 sq ft facility and clear a title for purpose of construction financing. D. Supportin~ Data: Plat approved October 24, 200S. Copy of document prepared by Attorney Bubul distributed at meeting. . . 2 !l! is= ~ ~W ~ \l i hi !l ~ <; Ij I( - ~ ~ ~ ~ ! ~i~~ l! I ~ ~i ., i . I ~ ~ !Ii ~ ~ i~~ ~ ~ .. b 8~~i II E> ~b i ~ Ii: .. i\ ~ lr b .. , ,8 ~ , Il, ;jb II," Ii; f .~ \ il. ~ ~~ ! i'! i ~i t ..i I~ l'b -=+ , " ~ "@ . ..~ lib ~ ~ d . ~~I h. i Un ~i l'b ~b j::. "l ~ I~ b .. ..it Si i~~ !i ~! ~i ~ .. .. ~ 5i.. !~~ .. ~ ~ I ~ . , . l"~ i!~~, ~ ~ - ~~ la.~ ,~ _b b i , . ~ ....~~ t&~~ t" Ii :ii ~! s l~ e Ii! ~i~ ~ I lb~ Ui ;\ Il!~ ~ig \~l ~~~ ~ .;~ .. ~d , b~ " 11 S !i~ ~t ~~ i~b h li ,t;~ i~~1 ~ !!~i ~u; :::..::: :::t.: <( II \ I Ii . ~ i' h ~I "I~' i\ II I II .. II , ""'. ,.'IK; . a -- _n___ ,---- - -- - 1 I -"""-"""'It -OF I .....~ .....eo! L" _"~'1_ .,.=.... -'U . . \.... .... ~ II .:2 ... ;;KB.o\. ' '..L i _i Iv) " . // ~ ( " " " \ / \ i \ \ \ <t i '" i " I :1,,-_ J!;l i I i . . . HRA Agenda - 11/02/05 5. Consideration to review proposal and approve hirinu: LHB to commence preparation of a redevelooment inspection report for proposed Redevelooment TIF District No. 1-37. A. Reference and back2:round: At the October 5, 2005 HRA meeting, the commissioners heard a presentation by Steve Mosberg, Suntide Commercial Realty, for potential redevelopment of Block 53, downtown Monticello. Steve was representing Chuck and Mike Van Heel of Allied Properties & Management LLC (APM). "J'he project consist of approximately 63,120 sq ft of leaseable retail and office space and 36 units of owneH)ccupied condos. Estimated total project cost including acquisition and demolition was $25,398,615. Projected gap was $6,429,204. Anticipated commencement April 2006. The HRA accepted the preliminary concept and approved entering into the Preliminary Development Agreement with APM. Because of the concerns of the relocation costs and the amount cif the gap, a meeting bctween the developers, Ehlers, Bubul, and staff was held on October 12,2005. Givcn the expertise of Bubul, an estimated cost of $300,000 for tenant relocation costs was added to the project. Ehlers indicated because oUhe current market value of the existing parcels, the estimated tax increment over 25 years was approximately $2 miJlion leaving a gap of $4 million. The potential of a $250,000-$300,000 State Redevelopment Grant, the addition of more housing, and perhaps a higher assessed value by the Assessor may help to narrow the gap. It was again acknowledged, the need of an inspection to qualify the parcels as a redevelopment district, to execute the Preliminary Agreement and submit the deposit of $7,500. A proposal was req uested. The proposal from LHB is attached and was forwarded to Mike Van Heel. They are currently re-evaluating the project. They did proceed with purchase of the Times property. Since they have not executed the Preliminary Development Agreement, submitted the deposit fee, nor agreed to pay for the LHB proposal; the proposal is presented for your review only. B. Alternative Action: 1. A motion to approve the hiring of LITR for TIF District Block 53 Inspection Services. 2. A motion to not hire LHB for TIF District Block 53 Inspection Services. HRA Agenda - t t /02/05 . ~ -'. A motion of no action due to a lack of response from the redeveloper, APM. C. Recommendation: Should we not hear from the redeveloper, the recommendation is alternative no. 3. D. Supportin2: Data: TIP Cashflows and proposal from LHB. . . 2 . . . 9/23/2005 . EHLERS CITY OF MONTiCELLO. The Times Redevelopment CondolRetail . TIF District I!I@_EW TJ.F:CASHF~OWAssuMP!fION$! ., "j Oistrict Type New Redevelopment District District Numb@ir Infl13tion Rate. Every Year 0,0000% Pay-As-You-Go Interest Rate 6.5000% Nole l$!;iued Date (Present Value Date) 01.Aug~06 Local Tax Rate" Maximum 122.1100% Pay 2005 Fiscal Disparities Election (A-inside or B-oulside) N/A Year Dis1rict was cl!Irti11@d Pay 2006 Assume$ First T"x Increment For District 2008 Year District was modified N/A Development located jn modified area No Assumes First Tax Increment for Project 2008 Years ofT ax Increment 26 Assumes Last YSClr or Tax Increment 2033 Fiscal Disparities Ratio Fiscal Disparities Metro VV'ide Tax Rate Local Tax Rat~ - Currenl State 'vVide Property Tax Rate (used for total taxes) Market Value Tax Rate (used for tOlallaxeS) 0.0000% 0.0000% 122.1100% Pay 2005 51.1210% Pay 2005 0.05440"':' Pay 2005 Commereiallndustrial Class Rate First 150,000 Over 150,000 Rental Class ~ate Residental Class Rate First 500,000 1.50%-2.00% 1.50% 2,00% 1.25% 1,00%-1.25%, 100% Page 1 of 2 fiiii','i, ....." Asli0lilll!llllll Cia!;;!;; Rate After Propl:!r1y Land Building lotal Class 8a~e Alter Conversion Dati:! Map ID PID O"":'_~~!.n.'_. Market Value Market Value Market Value ~_._._~~.!~. 'n__ T~,~,S:~p~~,!!y.___~~nversion lax Capacity Pa~~,=-- 1 155-010-053010 43,600- 43,600 1,50%-2.00% 654 1.00'/,., ,25% 436 2006 2 155-010-053020 84,700 B4}DO 1.50%-2.00(>/0 1,271 1.00%-1.25% 847 2006 3 155-010-053040 Mull"rPr"p 43,600 323,700 367,300 1 ,501.';,,-2,00% 6,596 1.50%-2.00% 6,596 2006 4 1 55-0 1 0-053050 Mull.., P">f> 88,100 320,200 408,300 1 ,500A,-2,000,/,\ 7,416 1,50%-2.00% 1,416 2006 5 155-010-053070 !';IIV"" K.PP,."I' 86,600 239,900 326.000 1,50%-7,,00%.. 6.180 1.00'Y,,-1,25% 3,265 2006 6 155-010-053090 ':;t:'v,,~ k_J" Plr;lP 43,700 43.700 1.50%.2,00%, 656 1,00%-125% 437 7,006 7 155.010-053100 IjQlk~r 43,700 14,900 58,600 1,50%-2,00% 879 100%-125% 588 2006 8 155.010-053110 Sm~h 57,200 57,200 1,50%-2.00% 858 1,000;","1,25% 572 2006 9 155-010-053111 46,200 121,300 167,500 1.50%-2.00(1" 2,600 1.00%-1.25% 1,675 2006 10 155-010-053112 !)I'T"~" 49.200 153,200 202.400 1 ,50%,200% 3,298 1,00%-1,25% 2,024 ;2006 -,_!~- 155.010,053130 261,700 699,500 961.200 1,50%-2.00% 18.474 1,00%.1.25% 9,612 2006 Totals 2,721,000 . ..48,~1~.__. -33,"i66-' ,Phase 1 Clilss Rati:! 1,00% 1,00%,-200% 1.00% 1.50%-2.00~~b TOTAL Market Valu~ 3,564,000 :2,367,000 3,564,000 2,367,000 _.__'"~!~~.~,_~~,~_! 1,862,000 U.. Condo Retail Condo Retail Sq. Ft.1Units 18 31,560 18 31,550 Sq. Ft.1Units 198,000 75 198,000 75 Note: Proj~!::t Tax Capacity 35,640 46,590 35,640 46,590 164.460 Yl:!a.r Constructed 2006 2006 2007 2007 Date Payable 200B 2008 2009 2009 1, TiF nm J~~ume~ 50% of th~ ptoja-L:t coMtru>:ttld by January 2, :WOG fOr paytlble 2007 Clrid th~ tertl~ind~t' i~ t.on~t"i.it:"H.>d by Ji'Hu.iary 2. 2007 for pJY.jjbi~~ 10013. U.e Tolat Tax C.. "cit 71,280 9:J,1ao 1~4,4.60 TAXCAlCUw\TIONS State-wide Prop~rty ~~..~~ 0.51121 0,51121 0,5t! 2L" Local .T:alles 87.040 11~,!81..._ .1~.O,~~ .__ .._ Local Fiscal Tax Dil!ipal'itie:s -1,,_Cffi-i~--l.l'_x~~~~i.!Y.- ,~t=}~~~=_=t::=-%------ Local Tax Rate "--Tfino- 1.22110 1.22110 Housing R.etail ,QI.~...._ Note: 1. Montic{:llo do~.f, not P,Ay f:isc"d Disp.lf'itl!:!$ Prepared by Ehl~t~ & A550c;:i..h:~1 Int:. Preliminary: For Discussion Purposes ONL V Mal'k~t Value Total Tax~'!S Taxe'!; 3,874 90,914 2,573 193,890 6,447 254,S04 Times Red~v~IQPl'rll!!l1t 9/23/2005 ~.age 2 of 2 . EHLERS . CITY OF MONTICELLO. THE TIMES REDEVELOPMENT Base Project Fiscal Ca ptufed Semi~Annual State Admin. Semi-Annual Serni-Annual PAYMENT DATE PERIOD BEGINNING Tax Tax Disparities Tax Gross Tax Auditor at Net Tax Present PERIOD ENDING ~~:..~q,~~.c;~.E.~.. Reduction ..<;:'~~.,,~~.crement q.;,~6"/o 1 O,OO'&,,~_ Increment Va.I..~,e Yrs. Mth, Yr, 0.0 02-01 2006 33.466 :13.466 0,0 08-01 2006 0,0 08-01 2006 33.466 33,466 0 Present Value Dato - 8-01-06 0 0 0 0 0,0 02-01 2007 0.0 02-01 2007 33.466 33.466 0 0 0 0 0 0 0 0,0 08-01 2007 0 0 0 0 0 0 0 0 48,764 29,773 (107) (2,967) 26,699 23.493 0 48,7G4 29,773 (107) (2,967) 26,699 46,246 1.0 02.01 2009 33.466 164,460 0 130,994 79,978 (288) (7,969) 71,721 105,445 15 08-01 2009 1.5 08-01 2009 33,466 164.460 0 1300994 79,978 (288) (7,969) 71,721 162,779 2.0 02-01 2010 2,0 02-01 2010 33,466 164,460 0 130,994 79,978 (288) (7,969) 71,721 218,309 25 08-01 1010 15 08-01 2010 33.466 164,460 0 130,994 79,978 (288) (7.969) 71.721 272,092 3.0 02-01 2011 3,0 02.01 2011 33,466 164,460 0 130,994 79,978 (288) (7,969) 71,721 324,181 3,5 08-01 2Dll 3.5 08.01 2011 33,466 164.460 0 130,994 79,978 (288) (7,969) 71,721 374,631 4.0 02-01 2D12 4,0 02-01 2012 33.466 164,460 0 130,994 79,978 (288) (7,969) 71,721 423.492 4,5 06.01 2012 4,5 DB-Ol 2012 33,466 164.460 0 130,994 79,978 (288) (7,969) 71,721 47Q,816 5,0 02.01 2013 5,0 02-01 2013 33.466 164.460 0 130,994 7~,978 (266) (7,969) 71,721 516,650 5.5 08-01 2013 5.5 08-01 2013 33.466 164.460 0 130,994 79,978 (288) (7,969) 71}21 561,041 6,0 02-Dl 2014 60 02-01 2014 33,468 164,460 0 130,994 79,978 (288) (7.969) 71,721 604,035 65 08-01 2014 8,5 08-01 2014 3~,466 164.460 D 130,994 79,978 (288) (7,969) 71,721 645,676 7,0 02-01 2015 7,0 02-01 2015 33.466 164.460 0 130,994 79,978 (288) (7,969) 71,721 686,006 7,5 08-01 2015 7,5 08-01 2015 33.466 164,460 0 130,994 79,978 (288) (7,969) 71,721 725,066 8.0 0,-01 2016 8.0 02-01 2016 33.466 164,460 0 130,994 79,978 (288) (7,969) 71,771 762,897 8.5 08-01 2016 6,5 08-01 ,016 33,466 164.460 0 130,994 79,978 (<68) (7,969) 71,721 799,537 9.0 02-01 2017 9.0 02-01 2017 33,466 164,460 0 130,994 79,97B (286) (7,969) 71,721 835,024 9.5 08-01 2017 9,5 08-01 2017 33,466 164,460 0 130,994 79,976 (288) (7,969) 71,721 869,394 10,0 02-01 2018 100 02-01 2018 33,460 164,460 0 130,994 79,978 (28B) (7,969) 71,721 902,682 10,fI 08-01 2018 10,5 08-01 2018 33,4fSS 164,460 0 130,994 79,97B (2BB) (7,969) 71,7<1 934,922 11.0 02-01 2019 11.0 02-01 2018 33,466 164.460 D 130,994 79,978 (288) (7,969) 71,721 966,148 11.6 08-01 ,D19 115 08-01 2019 33,466 164.460 0 130,994 79.978 (288) (7.969) 71,721 996.390 12,0 02-01 ,020 12,0 02.01 2020 33.466 164.460 D 130,994 79,978 (288) (7,969) 71.721 1,025,681 12.5 08-01 2020 125 08-01 2020 33.466 164.460 0 130,994 79,978 (288) (7,969) 71.721 1,054,049 13.0 02-01 2D<1 13.0 D2-01 2021 33.466 164.460 0 130,994 79,978 (288) (7,969) 71,721 1,081,525 13.5 06-01 2021 13,5 08-01 2021 33.466 164.460 0 130,994 79,978 (286) (7,969) 71.721 1,108,138 14,0 02-01 2022 14,0 02-01 ,022 33.466 164,460 0 130,994 79,97B (288) (7,969) 71,721 1,133,909 14.5 08-01 2022 14.5 08-01 202, 33,466 164,460 D 130,994 79,978 (288) (7,969) 71,721 1,158,870 15,D 02-01 2023 15,0 02-01 2023 33.466 164.460 0 130,994 79,978 (288) (7,969) 71,721 1,183,047 15,5 OB-Ol 2023 15.5 08-01 2023 33,466 164,460 0 130,994 79,978 (<88) (7,969) 71,711 1,206.462 150 02-01 2024 16,0 02-01 20:14 33,46S lB4,460 0 130,994 79,978 (28B) (7,969) 71,7<1 1,229,140 16.5 08-01 1D7.4 16.5 0801 2024 33.466 164.460 0 130,994 79,978 (288) (7,969) 71,721 1,:251,104 17,0 D,-D1 2025 . 17,0 02-01 2025 33.466 164.460 0 130,994 79.978 (288) (7,969) 71.721 1,272.3 n 17,5 OB-Ol 2025 17.5 08-01 2025 33.466 1~4.460 0 130,994 19,978 (288) (7,969) 71,721 1,292,980 18.0 02-01 2026 18.0 07-01 2026 33.466 164.460 0 130,994 79,978 (288) (7,969) 71,721 1,312,935 18.5 08-01 2026 1e.5 08-01 2026 33,466 164.<60 0 130,994 79,978 (2B8) (7,969) 71,721 1,332.262 19,0 02-01 2027 19.0 02-01 2027 33,466 164,460 0 130,994 79,9"18 (288) (7,969) 71}21 U50,980 19,5 08-01 2027 195 08-01 2077 33.466 164,460 0 130,994 79,978 (288) (7,969) 71,721 1,369,109 20,0 02-01 ,D,8 200 02-01 207.8 33,466 164,460 0 130,994 79,978 (288) (7,969) 71.721 1,386,668 20.5 08-01 ,028 20.5 08-01 2028 33.466 164.460 0 130,994 79,978 (288) (7,969) 71,721 1,403,673 21.0 02,01 2029 210 02-01 2029 33.466 164.460 D 130,994 79,978 (288) ((969) 71,721 1.420,144 215 08,01 2029 21.5 OB.Ol 2029 33.466 164.460 0 130,994 79,978 (288) (7,959) 71,721 l.436,096 22.0 D,-OI 2030 22.0 02.01 2030 33.466 164.460 0 130,994 79,978 (288) (7,969) 71.721 1.451,b46 22,5 08-01 2030 22.5 08-01 2030 33.466 154,460 0 130,994 79,978 (286) (7,969) '/1,721 1.466,509 no 02-01 2031 23,0 02-01 2031 33.466 164.460 0 130,994 79,978 (<8B) (7.969) 71,721 1.481,002 23.5 08-01 2031 235 08-01 2031 33,466 164,460 0 130,994 79,978 (288) (7,969) 71,721 1,495,038 24,0 02-01 Z032 24,0 02-01 2032 33.465 164,460 0 130,994 79,978 (288) (7,969) 71,721 1,508,633 24,5 08..01 20:32 24,5 08.01 2032 33.466 164.460 0 130,994 79,978 (288) (7,969) 71.721 1,521,800 25,0 02-01 2033 25.0 02-01 2033 33.466 164,460 0 130,994 '19,978 (2BB) (7,969) 71,721 1,534,552 25.5 08-01 2033 _J55 08-Q,I.__~ ~.3,4{j6 ,164_,,~, 0 130.994 7~,97B (28.8)_ (7,969) 71,7<1 1,546,903 ,60 02-01 .". u 2034 ---.,. ._-',. Totals ..._-,.. 4.05B,4~5 (14.6101_ j404,365) 3.639,~69 ..,..-.-.--- p!.e!i~nt Va:Ii.Je...q~!~_ ^ 8-01-06 .,. U81.0,!!,3 (6.210) _ J171,B76) 1,.546.903 No1~: 1. SW.t'" Auditor r"ym~~1 is. b~;~~~:;i O~ 1st haff: P~y 2005 actual ;;.nd rrli(i j(ttrease ov~rtN!'I~ of district 2. t\SSur"rI(!'!:, fir.'5t hijif of d(llve!(Jprnent i5 C(Jr'lsl'f'u:ct!..~d in 2006, tJ:!i!i<..~5.!:'0(. in 2.007 <:IF'lCi fir~t increment is p<ltd in 2008 ,', ASSUI'rlf.!S !;,~cond ~l<tlf of tiEJveloplYlerllls L;Dn~~~rucH:>d in 2n07, llS5IJSsod irl 2i)OB j'lnd first jnc;rl~rllent j!;,. paid ft~ 200fJ. 4, Amouf'lt of incmlTIf:nt INHi vary rJf!renuic~9 ilpOI1 market \r;}I~Jj~. t.ax rates, clar,~ r,Up'!,>, constrtJcti<.'lI) ~chequl~ ~nd infliltioll or; !1\i,rket v~lue. 5. InflMiQr'l I:!!i tax r.llt~s cannof bE clipWr~d.. TAX RATES COUl..n rlr:CUNE 6, TIF !;lces l':ot ti3.ptl,Jr~ !jit,W~ wide property ti'J;;>..(~s or m:;lrk~t V<ilue ~roperty t~x..es. 7, IF INFl.ATlONARY TIF lS HLCf;IVED IN 20GJ. l'HE", FINAL INCHf:MfNTWH..L Df 2!1/33, ~ "11:/"\:l1IclIl i~ L11..I:.!l1.!!.!.!! Tj\I.IIIII'u"crt~' Ta\~.~ Il'.~s 'stall' T", Ic.~~ Mark....t V IIII1C 'f :1\. Ic~.~ b:i.~lill~ lll:\l'.~ AIIIIII;IJ l<l.\ 111(1-1'1111111 filllllH:inC ~., 'WIWR"IIALYSIS 25",9U,1 -~7,(i.l~ -(~ ,-1-17 ,_iII,lIt,:; E~limalt. l:'il),4):"l7 lc.~.~ IIlIY admin. ft,t~ Current Mal'k~1 V;.tluc - Est N~w M~(kd Value - Est Difference F-'r~~t::ni Value of Tax InC:l'er'r'1~nt Dltl~l~rH::1J V.:.llJ~ lJk~ly to Occur \l\lithout Tax 11\(:I~m~I1II'; Less Than L,'U'I,()OO ---22",,89~,OOO 9,141,000 1,7B1,OG3 7.359,947 7,359,947 N, \Minnsota\Mol)II(;~II\l\ Times Redt:!velnp\ Time,; Redeveluprrll;~rl\. xis . Prepared bV I:hhm; & A!I.!IQcjat~, Inc. Preliminary: FDf OISC:Llnion Purposes ONLY Ti mea RE!d~v~loplT'J(lnt . . . 250 Third A venue NOJ1h, Suite 450 Minneapolis, Minnesota 55401 612.338.2029 Fax 612.338.2088 www.LHBcorp.com October 21,2005 Ollie Koropchak Economic Development Director City of Monticello 505 Walnut Avcnue, Suite J Monticello, MN 55362 PROPOSAL FOR TlF DISTRICT BLOCK 53 INSPECTION SERVICES Thank you for the opportunity to sublnit a proposal for the City of Monticello Block 53 TlF District inspection services. LHB is a full-service architecture and engineering firm with 145 employees in our Minneapolis and Duluth offices. Our Community Design studio has extensive experience working with local governments on their planning, design, architectural and engineering needs. Having been personally involved as a City Council President, I understand how cities function and the importance of maintaining the support of the city council and community throughout the process. PREVIOUS EXPERIENCE LHB has significant experience with a variety of inspection and facility assessment projects, including the analysis of over 30 TIF districts in the past four years. Examples include: City of Columbia Heights TIF inspection services City of S1. Paul 1'117 inspection services City of S1. Anthony Village, NW Quadrant TlF inspection services City of S1. Louis Park TIF District inspection services City of Mound TIF District"] -2" inspection services City of Osseo TIF inspection services City ofNcw RichnlOnd. WI TIF inspection services Minncsota State Colleges and Universities system facility assessments State of Minnesota facility assessments Property Condition assessments for the S1. Paul Department of Planning and Economic Development (Franklin/Emerald Neighborhood) Condition survey of every property along the 1-394 corridor for the Minnesota Department of Transportation, prior to and during the construction of 1-394 ADA compliance assessments for the State of Minnesota (82 buildings in ] 992) Duluth_ MN Minneapolis_ MN Proposal for Monticello Block 53 TIF District Inspection Services Page 2 of6 October 21, 2005 METHODOLOGY . A. Survey the proposed TIF district to determine if it meets the "Coverage Test": I. To meet the coverage test, parcels consisting of 70 percent of the area of the district must be "occupied" by buildings, streets, utilities, or paved or gravel parking lots. 2. ^ parcel is not considered "occupied" unless at Icast 15% of its total area contains improvements. B. Make the following attempts to inspect the interior of each building in the district: I. Obtain propelty owner's consent for inspection. 2. Document all property conditions relative to Minncsota Statutes Section 469.174 Subdivision 10. . C. Determine replacement cost for each building: 1. Replacement cost is the cost of constructing a new structure of the same square footage and type on the site. 2. A base cost will be calculated by establishing the building class, typc and construction qual ity. 3. Identify amenities, which increase the value of the building over thc standard construction qual ity level. 4. Revicw building permits for each parcel. 5. The base cost and cost of amenities will be totaled to determine the replacement cost fix the propel1y. D. Determine the existing condition of each building: 1. "Structurally substandard shall mean containing defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance." E. Determine Code Deficiencies in each building: 1. Determine technical conditions, which are not In compliance with current building code applicable to new buildings. 2. Determine costs to correct identified deficiencies. 3. Compare cost of deficiency corrections to replacement value of bui Id ing. 4. A building is not structurally substandard if it is in compliance with building code applicable to new buildings or could be modified to satisfy the building code at a cost of less than 15 percent ofreplacel1lent cost. . Proposal for Monticello Block 53 TIF District Inspection Services Paoe3of6 '"' October 21, 2005 . F. Prepare a final report outlining findings: 1. Prepare a tabulated spreadsheet of the entire proposed district properties conditions. 2. Prepare a written narrative analysis of the redevelopment district describing why the property within thc district does or does not meet the criteria as "structurally substandard" as established in Minnesota Statutes Section 469.174, subdivision 10. 3. Deliver final reports to City staff. ASSUMPTIONS Preliminary boundaries of the prospective district include eleven (11) parcels that will be analyzcd for the coverage test. If the coverage test is met, nine (9) buildings will require an intcrior inspection. . The City of Monticello will provide the following: . A list of building permits issued for the parcels in the Jastthree years. . A Icttcr to the property owners authorizing and explaining the inspections. . Othcr documents as may be required to assess thc condition ofthe buildings and determine coverage tests, including maps and GIS information with spccific parccl data. . A parcel map of the area to be inspcctcd. . A list of all parccls including owner, current known business or resident nanle and address. COST AND FEE STRUCTURE We propose to work on an hourly basis with the following key staff: Project Principal, Michael Fischer (TIF analysis) Project Managcr/ Arch itect/lnspector, Jerry Putnam Project Administrator (Property owner contacts, docllmentation) Project Planner coordinating GIS information and mapping $l72/hour $110/hour $61/hour $99/hour We will work on an hourly basis with a not-to-exceed fee budget of $12,000 plus rcimbursable expenses for the inspection of the 9 structures and a full repOli outlining the findings for the TIF district. SCHEDULE We currently have an opening in our schedule to start work immediately. If you are unable to start within one week, we should be able to bcgin work by November 15, 2005. Assuming full cooperation of the property owners and the City, we will completc the final report within 45 days ofthc start date. . Proposal for Monticello Block 53 TIF District Inspection Services Page 4 of6 October 2 I, 2005 . TERMS We propose using an AlA Document B727 (Standard Form of Agreement Between Owner and Architect for Special Services). The contract will include "limit of liability" language (equal to our fee or $10,000 maximum, whichever is greater). In addition, the contract will contain language negotiated with the city indicating that LHB and the City, acting through the City's legal representative, will, to the fullest reasonable extent, cooperate and coordinate effclIis in preparing responses to any third party challenges to the inspections. TEAM CREDENTIALS . Michael A. Fischer, AlA - Project Principal/TIF Analyst Michael has nineteen years of architectural experience as project principal, project manager, project designer and project architect on municipal planning, educational, commercial and governmental projects. He is a Vice President at LHB and currently leads the Community Design Group in LHB's Minneapolis office. Michael completed a two-year Bush Fellowship at the Massachusetts Institute of Technology in 1999, earning Masters Degrees in City Planning and Real Estate Development. Michael has served on over 35 committees, boards and community task forces, including a term as City Council President and Chair of the Duluth/Superior Metropolitan Planning organization. He is currently a Planning Commissioner in Edina, Minnesota. He was one of four architects in the country to receive the National "Young Architects Citation" ii-om the American Institute of Architects in 1997. Jerry A. Putnam, AlA, FCSI, CCS - Project ManagerlInspector Jerry is a senior architect in LHB's Minneapolis office with twenty-five years of experience in all phases of the architectural process, from pre~design through construction administration, including specialty consulting in investigations for buildings, building condition surveys, TIF inspections, code reviews, estimating and specification writing. Jerry is an active member in the Construction Specification Institute (CSI). He has been recognized as a Fellow of CSI for his dedication and leadership in the construction industry. In addition to being past president of the largest CSI chapter in the United States, he serves on many local, regional and national committees, and has given presentations at many specification writing classes and workshops. Dennis Swartz, CSI - Inspector Dennis has over 34 years of experience as a project architect and specifier, working for clients throughout the United States and around the World. He is an active member of the Construction Specifications Institute (CS1) and is the former Treasurer of the Minneapolis-St. Paul chapter. . Todd Koneczny, AlA - Project Manager/Inspector Todd has twenty-one years of design and construction experience in a wide variety of building projects for municipal, institutional, healthcare and commercial clients. His responsibilities often include project management, architectural design, construction document preparation and construction administration. His seventeen years of design Proposal for Monticello Block 53 TIF District Inspection Services Page 5 of6 October 21, 2005 . experience and four years of construction management experience has gIven him the ability to understand all aspects of building systems and components. Bruce Chalupsky, ASLA - GIS/Coverage Analysis Bruce has more than ten years of experience as a landscape architect/planner. During this time, he has specialized on site master planning for public and private clients. Bruce has also pursued specialization in Geographic Information Services (GIS) and is proficient in the administration of community data and the production of maps for a variety of needs. REFERENCES Stephen ./. Bubul Kennedy & Graven 612/337-9300 Mary L. Ippel Briggs and Morgan 651/223-6620 NEXT STEP . Upon acceptance of this proposal, we will draft an AlA Owner/Architect agreement for your review. Thank you for the opportunity to submit a proposal for your project. Please contact me at (612) 752-6920 if you have any questions. LHB INC. ~~ MICHAEL A. FISCI'IER, ALA DIRECTOR, COMMUNITY DESIGN GROUP c: T.JK/MAF/JAP L\MARKETlNG\Proposul Lctters\2005\TlF Inspections\Monticcllo TIF District Block 53 IO-II-05.doc . . . . HRA Agenda - 11/02/05 6. Consideration to review and accept: A. Increase in fees bv Ehlers & Associates. Attached is thc memo horn Mark Ruff noting the proposcd hourly fee increase and rangc of fees for establishment of TIF Districts, etc. This proposal is before the HRA for two purposcs: 1. Review and accept proposed increasc in fecs as presentcd by Ehlers & Associates. 2. As information in its relationship to HRA deposits and the J I RA budget. 1. A motion to accept the fee incrcase as proposed by Ehlers & Associatcs. 2. A motion to authorize rcsearch fee schedulcs of other financial consultants. 3. A motion to table any action. B. Revisions to the Preliminary Development Al!reements. As you recall, I rcquested the HRA Attorney update thc HRA's Preliminary Developmcnt Agrecments. The normal agreemcnt is used f()f TIF projects other than projects within the Monticello Business Center. The new agreement for use within the Monticello Business Center was prcpared to cover up-front development costs incurrcd by the HRA. Example: The BRA authorizes commenccment of thc platting proccss associated with the conveyance of property. The required dcposit is also largcr. This item is bcfore the HRA commissioners for the purpose of information and to acccpt thc revised documcnts. I. A motion to accept thc two rcvised Preliminary Development Agreements. 2. A motion to recommend changcs to either of the Agreemcnts. 3. A motion to table any action. . . . o :E w :E ~ f\. . . EHLERS & ASSOCIATES INC To: Ollie Koropchak, City o[Monticello Mark Ruff October 12, 2005 From: Date: Su~ject: Fees Our firm appreciates the opportunity to work with the City of Monticello and the Monticello HRA. I appreciate the professional challenges of redevelopment and new growth that your city presents on a regular basis. As you are aware, our fIrm has not raised its hourly fees and fees for TIF districts for the HRA fix several years. I recall that since we started working with the City in 1995, we have raised our fees only once. Currently we are at $125 per hour. Almost all of the other clients I serve are at hourly rates of $175 to $185 per hour. In addition, new requirements forTI F districts have recently been passed in Minnesota regarding disclosure of fIscal implications which will complicate TIP plans after the end 01'2005. To avoid these large increases in rates in the future, I would propose that we raise our hourly fees to $150 per hour and then increase $5 per hour annually for the next four calendar years. This is still below our market rate for other clients, but Monticello is one of our more active clients and I sincerely appreciate the relationship we have developed with the City and HRA over the past decade. Attached is a chart with our standard fees forTI F districts. Please call with any questions. LEADERS IN PUBLIC FINANCE 1\ 3060 Centre Pointe Drive Roseville, MN 55113-1105 Phone: 651-697-8505 Fax: 651-697-8555 mark@ehlers-inc.com . . . ~ It) c C N ~ :::::I - (J :::::I I... - UJ CD CD L1. - ca u: .....Noo.....<DIONIOIOMN cn;::IO~J"-.'<T'<T""''<Tg~ CO<DIO.....1000 ON..... 1OJ"-.'<Tcn'<TMMtOMNtO 000000000000 000000000000 10 O. 10, 10 O. 10. 10 0 10 10 O. 0, '1000 'ON . . . '00 cn..........O>N.....I'-J"-.Nl'-lOM tfl,tfl,tfl,tfl,lfl-lfl-lfl-tfl,lfl-tfl,lfl-tfl, o 000088 0010000000000 1010 ,10 .100000 ' , 1'-- 0>' N 1'-' 10 1'-' ll'i 10' .....' ll'i 10 0 tfl,lfl-;).lfl-;).lfl-lfl-lfl-lfl-lfl-~;). I..L.I..L. i=i= , , 130 'C .C (;)(;) 00 $ :.::i III III 0) 0) "E c: I..L. 'i5J'i5J E 0) 0) -I- 0) 0) a.EE 15m Oa.a.,.......... >- w.f!.f!t5U5U5 "0 :> 0) 0) 'C _ _ .a 0) > > 1i) .!!!.!!! CI) o 0) 0) ,- u u >- 0) u"O"OOcc"O.....III .- 0) 0) ClI ClI ~ ClI c: EO::'O::'cCc:.....O::'ClI o = 0) .- ii: u:::: CI) >- ii: C~_IIl .......... o 'u t;::' ~ >- >-.c := Q.. uEClIoO)O)O):;:::;_ WCl)...JI~~O~O '0 c: ~ ..... 0) III 'C e- O) "E 0) ..... 0) .e C III ClI III ii: ~ ..... 0 c: ..... 0) a.. ~ E c: .- 0) .Q -g ClIitiU5 c a...... ClI "[5 u ::;!'E~ ClI rf. E '0 u = ffi ii ~ .!: ~ .!!! I..L.Q..I..L. 'ti ; o 1; Q) E: ~ Ql .$ ... ... o .... U Ql '::" e Q. Ql :S .... o ~ ')( oS! Q. E: o u Q) :S s::: o Q. ::. b Ql l:l .Q e III III Ql ~ .!! o ~ Page 1 of 1 Ollie Koropchak It. ~ ~ . From: Bubul, Stephen J, [sbubul@Kennedy-Graven,com] Sent: Friday, October 07,2005 1:20 PM To: Ollie Koropchak Cc: Ingram, Martha N, Subject: Preliminary Agreements Attachments: Form Preliminary Developmennt Agreement.doc; Form Prelliminary Development Agreement Monticello Business Center,doc Attached are the following: 1. The form Preliminary Development Agreement for your normal TIF developments. I have updated language in a couple of places, and left dates and dollar amounts blank You can use this as the template for future agreements 2_ The form Preliminary Development Agreement for future projects in the Monticello Business Center, This is the form that we started with in negotiations with Dahlheimer, with a few revisions. To summarize, the Agreement provides as follows: · The agreement has an initial term and an extended term If the Developer wants to extend the term, it must pay an option payment, which will become non-refundable if no contract is entered into and the property is never sold_ (We removed this from the Dahlheimer transaction), . · The Developer must deposit $10,000 upon signing If costs exceed that amount during the term of the PDA, Developer must pay the additional amounts, If the PDA is terminated, the HRA will return any amounts on deposit that exceed costs incurred by the HRA. Costs incurred include platting costs, and a cost has been incurred if a contract for those costs was entered into before the date of termination. Therefore, if the HRA begins the platting process by hiring an engineer, the Developer will be responsible for all those costs if the PDA is terminated_ Further, if the initial term was extended, the Developer will forfeit the option fee described above (In effect, the option fee for extending the PDA serves the same function as a non-refundable deposit.) Let me know if you have questions. Stephen Bubul Kennedy & Graven 470 U.S_ Bank Plaza Minneapolis, MN 55402 612-337 -9228 . 10/13/2005 . . . Form October 7, 2005 HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO, MINNESOTA PRELIMINARY DEVELOPMENT AGREEMENT 'fl-IIS AGREEMENT, dated this _ day of , 20_ by and between the lIousing and Redevelopment Authority in and for the City of Monticello, Minnesota, a public body corporate and politic under the laws of Minnesota ("Authority") and ("Developer"): WITNESSETH: WHEREAS, the Authority desires to promote development of certain property within the City of Monticello, which property is legally described in Exhibit A attached hereto ("Property"); and WHEREAS, the Developer has submitted a preliminary proposal (the "Proposal") for development of the Property (the "Development"), which proposal is attached hereto as Exhibit B; and WHEREAS, the Developer has requested the Authority to explore the use of certain public assistance to assist with the Development; and WHEREAS, the Authority has determined that it is in the Authority's best interest that the Developer be designated sole developer of the Property during the term of this Agreement; and WHEREAS, the Authority and the Developer are willing and desirous to undertake the Development if (i) a satisfactory agreement can be reached regarding the Authority's commitment for public costs necessary for the Development; (ii) satisfactory mortgage and equity financing, or adequate cash resources for the Development can be secured by the Developer; and (iii) the economic feasibility and soundness of the Development and other necessary preconditions have been determined to the satisfaction of the parties; and WHEREAS, the Authority is willing to evaluate the Development and work toward all necessary agreements with the Developer if the Developer agrees to reimburse the Authority for its costs if the Development is abandoned or necessary agreements are not reached under the temlS of this Agreement. NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and obligations set forth herein, the parties agree as follows: I. Negotiations between the parties shall proceed in an attempt to formulate a definitive development contract ("Contract") based on the following: S.lU-26<J35Xv I MNI90-]OI . . . (a) the Developer's Proposal, which shows the scope of the proposed Development in its latest form as of the date of this Agreement, together with any changes or modifications required by the Authority; (b) a mutually satisfactory Contract to be negotiated and agreed upon 111 accordance with negotiations contemplated by this Agreement; (c) such documentation regarding economic feasibility of the Project as the Authority may wish to undertake during the term of this Agreement; and (d) other temlS and conditions of this Agreement. 2. It is the intention of the parties that this Agreement: (a) documents the present understanding and commitments of the parties; and (b) will lead to negotiation and execution of a mutually satisfactory Contract f()r the Development prior to the temlination date of this Agreement. The Contract (together with any other agreements entered into between the parties hereto contemporaneously therewith) when executed, will supersede all obligations of the parties hereunder. 3. During the teml of this Agreement, the Developer shall: (a) Submit to the Authority a design proposal to be approved by the Authority showing the location, size, and nature of the proposed Development, including floor layouts, renderings, elevations, and other graphic or written explanations of the Development. The design proposal shall be accompanied by a proposed schedule for the starting and completion of all phases of Developmcnt. (b) Submit an over-all cost estimate for the design and construction of the Development. (c) Submit a time schedule for all phases of the Development. (d) Undeliake and obtain such other preliminary economic feasibility studies, income and expense projections, and such other economic infonnation as the Developer may desire to fllliher confirm the economic feasibility and soundness of the Development. (e) Submit to the Authority the Developer's financing plan showing that the proposed Development is financially feasible. (1) Furnish satisfactory, financial data to the Authority evidencing the Developer's ability to undertake the Development. 4. During the tcrm of this Agreement, the Authority agrees to: (a) Commence the process necessary to undcrtakc such public assistance as is necessary pursuant to the terms of the Proposal. SJ B-26'J35Xv I MN]<JO-IOI . (b) Proceed to seek all necessary information with regard to the anticipated public costs associated with the Development. (c) Estimate the Authority's level and mcthod of financial participation, if any, in the Development and develop a financial plan for the Authority's participation. 5. subject to: It is expressly understood that execution and implementation of the Contract shall be (a) A determination by the Authority in its sole discretion that its undel1akings are feasible based on (i) the projected tax increment revenues and any other revenues designated by the Authority; (ii) the purposes and objectives of any tax incrcment, development, or other plan created or proposed Jar the purpose of providing financial assistancc for the Devclopment; (iii) a determination by the Authority that tax incrcment financing or other public financial assistance is rcasonably necessary in order to make the Development feasible; and (iv) the best interests of the Authority. (b) A detcnnination by thc Developer that the Development is fcasible and in the best interests of the Developer. . 6. This Agreement is effective from the datc hereof through ~_ ,200 . After such date, neither party shall have any obligation hereunder except as exprcssly set forth to the contrary herein. 7. Thc Developer shall be solely responsible for all costs incurred by the Developer. In addition, the Developer shall reimburse the Authority for Administrative Costs, as hereafter defined. For the purposes of this Agrcement, the term "Administrative Costs" means out of pocket costs incurred by the Authority together with staff costs of the Authority, all attributable to or incurred in connection with thc negotiation and prcparation of this Agreement, the Contract, and other documcnts and agreements in connection with the Development, including without limitation the cost of financial advisors, attorneys, tax incremcnt building inspection consultants, and planning and environmental consultants. In ordcr to sccure payment of the Administrative Costs, the Developer shall deliver to the Authority cash or a ccrtiJied check in the amount of $ , such delivery to occur upon execution of this Agreement. If at anyone or more timcs during the term of this Agrecment, the Authority dctemlincs that Administrativc Costs will excccd $ and that additional security is rcquired, the Authority shall notify the Developer of thc anlount of such additional security. Within ten calendar days of rcceipt of this noticc, the Dcveloper shall delivcr to the Authority the required additional security. The Authority will utilize the funds delivered by the Developer to payor reimburse itsclffor Administrative Costs. Upon tcmlination of this Agreement, the Authority will return to the Dcveloper the funds paid by the Developer to the Authority pursuant to this Section 7, less an amount equal to the Administrative Costs. . 'fhis Scction 7 shall survivc termination of this Agrcement and shall be binding on the Developer regardless of the cnforccability of any other provision of this Agreement. SIB.26'13'i8vl MNI90-IOI . . . 8. This Agreement may be terminated upon 5 days written notice by the Authority to the Developer if: (a) an essential precondition to the execution of a contract cannot be met; or (b) if: in the respective sole discretion of the Authority or the Developer, an impasse has been reached in the negotiation or implementation of any material term or condition of this Agreement or the Contract; or (c) The Authority detennines that its costs in performing under this Agreement will exceed the anlount deposited under Section 7 and the Developer does not deliver additional security to the Authority pursuant to Section 7 of this Agreement. If the Authority tenninates the Agreement under this Section 8, the Developer shall remain liable to the Authority under Sections 6 and 7 of this Agreement for costs incurred by the Authority through thc date of temlination. 9. Agreement. The Developer is designated as sole developer of the Property during the term of this 10. In the event that the Developer, its heirs, successors or assigns, fail to comply with any of the provisions of this Agreement, the Authority may proceed to enforce this Agreement by appropriate legal or equitable proceedings, or other similar proceedings, and the Developer, its heirs, successors or assigns, agrce to pay all costs of such enforcement, including rcasonablc attorneys' fees. 11. If any p0l1ion of this Agreement is held invalid by a court of competent jurisdiction, such decision shall not affect the validity of any remaining portion ofthe Agreement. 12. In the event any covenant contained in this Agreement should he breached by one party and subsequcntly waived hy another party, such waiver shall be limited to the particular breach so waived and shall not be deem cd to waive any other concurrent, previous or subsequent breach. 13. Notice or demand or other communication between or among the parties shall be sufficiently given if sent hy mail, postage prepaid, return receipt requested or delivered personally: (a) As to the Authority: Housing and Redevelopment Authority in and for the City of Monticello 505 Walnut Street, Suite 1 Monticello, MN 55362-8822 Attn: Executive Director (b) As to the Developer: ~.,. SJR-26935Hvl MN 190-101 . . . 14. This Agreement may be executed simultaneously in any number of counterparts, aU of which shall constitute one and the same instmment. 15. This Agreement shall be governed by and constmed in accordance with the laws of the state of Milmesota. Any disputes, controversies, or e1aims arising out of this Agreement shall be heard in the state or federal courts of Minnesota, and all pmiies to this Agreement waive any objection to the jurisdiction of these courts, whether based on convenience or otherwise. 16. The Developer hereby agrees to protect, defend and hold the Authority and its officers, elected and appointed officials, employees, administrators, commissioners, agents, and representatives harmless from and indemnified against any and all loss, cost, fines, charges, damage and expenses, including, without limitation, reasonable attorneys fees, consultant and expert witness fees, and travel associated therewith, due to claims or demands of any kind whatsoever arising out of (i) the devclopment, marketing, sale or leasing of all or any part of the Property, including, without limitation, any claims for any lien imposed by law for services, labor or materials furnished to or for the benefit of the Property, or (ii) any claim by the state of Minnesota or the Minnesota Pollution Control Agency or any other person pertaining to the violation of any permits, orders, decrees or demands made by said persons or with regard to the presence of any pollutant, contaminant or hazardous waste on the Property; and (iii) or by reason of the execution of this Agreement or the performance of this Agreement. The Developer, and the Developer's successors or assigns, agree to protect, defend and save the Authority, and its officers, agents, and employees, harmless from all such claims, demands, damages, and causes of action and the costs, disbursements, and expenses of defending the same, including but not limited to, attorneys fees, consulting engineering services, and other technical, administrative or professional assistance. This indemnity shall be continuing and shall survive the performance, termination or cancellation of this Agreement. Nothing in this Agreement shall be construed as a limitation of or waiver by the Authority of any immunities, defenses, or other limitations on liability to which the Authority is entitled by law, including but not limited to the maximum monetary limits on liability established by Minnesota Statutes, Chapter 466. 17. The Developer, for itseH: its attorneys, agents, employees, former employees, insurers, heirs, administrators, representatives, successors, and assigns, hereby releases and forever discharges the Authority, and its attorneys, agents, representatives, employees, former employees, insurers, heirs, executors and assigns of and ti-om any and all past, present or future claims, demands, obligations, actions or causes of action, at law or in equity, whether arising by statute, common law or otherwise, and for all claims for damages, of whatever kind or nature, and for all claims J{)r attorneys' fees, and costs and expenses, including but not limited to all claims of any kind arising out of the negotiation, cxecution, or performm1ce of this Agreemcnt betwecn the parties. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] S.IU-269J58v I MNI9()-IOI . . . IN WITNESS WHEREOF, thc Authority has caused this Agreement to be duly executed in its name and behalf and its seal to be duly affixed hereto and the Developer has caused this Agreement to be duly executed as of the day and year first above written. DEVELOPER By Its: By Its: S.lI3-2()'J358v I MNI90-IOI . . . HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO, MlNNESOTA By Its Chair By Its Executive Director SJ8-26935Xvl MN190-101 Form . October 7,2005 HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO, MINNESOTA PRELIMINARY DEVELOPMENT AGREEMENT (Monticello Business Center) TI-HS AGREEMENT, dated this _ day of , 20_ by and between the Housing and Redevelopment Authority in and for the City of Monticello, Minnesota, a public body corporate and politic under the laws of Minnesota ("Authority") and ("Developer"): WITNESSETH: WHEREAS, the Authority or the City of Monticello ("City") owns certain property within the City of Monticello, which property is legally described in Exhibit A attached hereto ("Property"); and WHEREAS, the Developer has submitted a preliminary proposal (the "Proposal") for the acquisition and development ofthe Property (the "Development"), which proposal is attached hereto as Exhibit B; and . WHEREAS, the Developer has requested the Authority to explore the use of certain public assistance to assist with the Dcvelopment; and WHEREAS, the Authority has determined that it is in the Authority's best interest that the Developer be designated sole developer of the Property during the term of this Agreement; and WHEREAS, the Authority and the Developer are willing and desirous to undertake the Development if (i) a satisfactory agreement can be reached regarding the Authority's commitment for public costs necessary for the Development; (ii) satisfactory mortgage and equity financing, or adequate cash resources for the Development can be secured by the Developer; and (iii) the economic feasibility and soundness of the Development and other necessary preconditions have been dctennined to the satisfaction of the parties; and WHEREAS, the Authority is willing to evaluate the Development and work toward all necessary agreements with the Developer if the Developer agrees to make the nonrefundable deposit described herein, which is intended, in pmi, to reimburse the Authority for its costs if the Development is abandoned by Developer or necessary agreements arc not reached under the tenns of this Agreement. NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and obligations set f()rth herein, the parties agree as follows: . 1. Negotiations hetween the parties shall procced in an attempt to formulate a definitive purchase and development contract ("Contract") based on the following: . . . (a) the Developer's Proposal, which shows the scope of the proposed Development in its latest form as of the date of this Agreement, together with any changes or modifications required by the Authority; (b) a mutually satisfactory Contract to be negotiated and agreed upon 111 accordance with negotiations contemplated by this Agreement; (c) such documentation regarding economic fcasibiJity of the Project as the Authority may wish to undertake during the term of this Agreement; and (d) other terms and conditions of this Agreement. ? It is the intention of the parties that this Agreement: (a) docLUnents the present underst-:mding and commitments of the pmiies; and (b) will lead to negotiation and execution of a mutually satisfactory Contract for the Development prior to the termination date of this Agreement. The Contract (together with any other agreements entered into between the parties hereto contemporaneously therewith) when executed, will supersede all obligations of the pmiies hereunder. 3. During the term of this Agreement, the Developer shall: (a) Submit to the Authority a design proposal to be approved by the Authority showing the location, size, and nature of the proposed Development, including floor layouts, renderings, elevations, and other graphic or written explanations of the Development. The design proposal shall be accompanied by a proposed schedule for the starting and completion of all phases of Development. (b) Submit an over-all cost estimate for the design and construetion of the Development. (c) Submit a time schedule for all phases of the Development. (d) Undertake and obtain sueh other preliminary economic fcasibility studies, income and expense projections, and such other eeonomic infonnation as the Developer may desire to further confinn the economie feasibility and soundness of the Development. (c) Submit to the Authority the Developer's financing plan showing that the proposed Development is financially feasible, and, to the extent Developer seeks public financial assistance in any form (including reduced land cost, waiver of tees, and tax increment financing), evidence that such assistance is reasonably necessary to make the Development financially feasible. (f) Furnish satisfactory, financial data to the Authority evidencing the Developer's ability to undertake the Development. (g) Cooperate with the Authority and City 111 replatting of the Propeliy as described in Section 4. SJB-200X95v2 MN190-41 2 . 4. During the term of this Agreement, the Authority agrees to: (a) Conunence the process necessary to undeliake such public assistance as is necessary pursuant to the terms of the Proposal, including without limitation commencement of actions necessary to create a tax increment financing district that includes the Property. (b) Proceed to seek all necessary information with regard to the anticipated public costs associated with the Development. (c) Estimate the Authority's level and method of financial participation, if any, in the Development and develop a financial plan f(Jr the Authority's participation. . (d) Either acquire the Property and grant to the Developer, or cause the City to grant to the Developer, a right of access to the Propcrty for purposes of environmental and soil testing. Dcveloper agrees to indemnify, save harmless, and defend the Authority and City , their officers, and employees, from and against any and all elaims, actions, damages, liability and expense in connection with personal injury and/or damage to the Property arising from or out of any occurrence in, upon or at the Propeliy caused by the act or omission of thc Developer in connection with Developer's entry on the Property. Further, Developer shall not permit any mechanics', materialmens' or other liens to stand against the Property or any part thereof for work or matcrials furnished to Developer in connection with the right of entry granted pursumlt to this Agreement and Developer agrees to indemnify, defend and hold harmless the Authority and City from and against the same. (e) Commence replatting of the Property, or cause the City to commence such replatting, in order to create the parcel described on Exhibit A. 5. It is expressly understood that execution of the Contract shall be subject to: (a) A determination by the Authority in its sole discretion that its undertakings are feasible based on (i) the projected tax increment revenues and any other revenues designated by the Authority (to the extent requested by Developer); (ii) the purposes and objectives of any tax increment, development, or other plan created or proposed for the purpose of providing financial assistance for the Development, if any, including the determination that such assistance is reasonably necessary in order to make the Development possible; (iii) the best interests of the Authority. (b) A determination by the Developer that the Development is feasible and in the best intcrests of the Developer. . 6. This Agreement is effective from the date hereof through ,20 (the "Initial Term"); provided that the term of the Agreement may be extended through , 20_ (the "Extended Term") if Developer exercises the option described in Section 8 hereof. After expiration of the Jnitial Teml without action by Developer under Section 8, or upon expiration of the Extended Teml if Developer exercises its rights under Section g, ncither party shall have any obligation SJR-200895v2 MN I ()1)-4! ..., .) hereunder except as expressly set forth to the contrary herein. . 7. The Developer shall be solely responsible for all costs incurred by the Developer. In addition, the Developer shall reimburse the Authority for Administrative Costs, as hereafter defined. For the purposes of this Agreement, the term "Administrative Costs" means out of pocket costs incurred by the Authority and City together with staff costs of the Authority and City, all attributable to or incurred in connection with the negotiation and preparation of this Agreemcnt, thc Contract, and other documents and agreements in connection with the Development, including without limitation all costs in cOlmection with replatting of the Property and the cost of financial advisors, attorneys, and planning and environmental consultants. . In order to secure payment of the Administrative Costs, the Developer shall deliver to the Authority cash or a certified chcek in the amount of $10,000, such delivery to occur upon execution of this Agreement. If at anyone or more times during the tenn of this Agreement, the Authority determines that Administrative Costs will exceed $10,000 and that additional security is required, the Authority shall notify the Developer of the anlount of such additional security. Within ten calendar days of receipt of this notice, the Developer shall deliver to the Authority the required additional security. The Authority will utilize the funds delivered by thc Developer to payor reimburse itself for Administrative Costs. Upon ternlination of this Agreement, the Authority will return to the Developer the funds paid by the Developer to thc Authority pursuant to this Section 7, less an amount equal to the Administrative Costs incurred by the Authority through the datc of notice oftennination. For the purposes of this paragraph, Administrativc Costs are considered to he incurrcd if they have been paid, relate to services perform cd, or are payable under a contract entered into, on or hefore the datc of the notice of termination. This Section 7 shall survive tennination of this Agrccment and shall be binding on the Developer regardless of the enforceability of any other provision of this Agreement. 8. (a) The parties agree and understand that the final Contract is expected to provide for conveyance of all or a portion of thc Property from the Authority to the Developer or its assigns, under terms agreed upon in the Contract. The parties currently anticipate that the Property will be conveyed for a purchase price to be dctcrmined and subject to satisfaction of contingencies specified in the Contract. As noted in Section I 0 hereof~ the Authority may not sell, or negotiate for the sale of, any portion of the Property to any other person or entity during the term of this Agreement. As consideration for such exclusive rights, if Developer wishes to extend the Initial Term of this Agreement, the Developer agrees to pay to the Authority an option payment of $ (the "Option Payment") Llpon or before expiration of the Initial Term. If Developer makes such timely payment, the term of the Agreement is automatically extended through the Extended Term specified in Section 6. . (b) If a Contract is executed within the Extended Term, and any portion of the Property is conveyed to the Developer in accordance with its terms, a pro rata portion of the Option Payment shaJI be applied against the purchase price of the first portion of the Property so conveyed. The term "pro rata portion" means a percentage based on the area of the portion of the Property first conveyed as a share of the total square footage of the property owned by the Authority. The balance of Option Paymcnt shall be applied against the purchase price of subsequent portions of the Property on the same basis. SJR-200895v2 MN I '-)0-41 4 . . . (c) If for any reason a Contract is not negotiated and executed within the Extended Term or any mutually approved extension thereof, or if this Agreement is terminated pursuant to Section 9 hereof (other than due to breach by the Authority), or if the Contract is terminated pursuant to its terms for any reason (other than due to breach by the Authority) before closing on conveyance of any portion of the Property the Developer, then the Authority shall retain the Option Payment. The Developer shall have no rights or interest in any interest earnings on the Option Payment or in the amount retained by the Authority under this Section. The substantial terms of this Section shall he incorporated in any Contract entered pursuant to this Agreement. 9 This Agreement may be tenninated upon 5 days written notice by a party to the other party if: (a) if~ in the respectivc sole discretion of the Authority or the Developer, an impasse has been reached in thc negotiation or implementation of any material term or condition of this Agreement or the Contract; or (b) the Authority detennincs that its costs in performing under this Agreement well exceed $10,000 cmd the Dcveloper does not deliver additional security to the Authority pursuant to Section 7; or (c) a party fails to perfonn any of it's obligations under this Agreement. If either party terminates the Agreement under this Section 9, the Developer shall remain liahle to the Authority to the extent provided under Sections 7 and 8 or this Agreement. 10. During the term of this Agreement, the Authority agrees that it will not negotiate or contract with any other party coneerning thc sale or development of the Property. The Developcr shall not assign or transfer its rights under this Agrecment in full or in part, or enter into any subcontracts to perform any of its obligations hereunder, without the prior written consent of the Authority. I 1. In the event that the Developer, its heirs, successors or assigns, fail to comply with any of the provisions of this Agreement, the Authority may proceed to cnforce this Agreemcnt by appropriate legal or equitable proceedings, or other similar proceedings, and the Developer, its heirs, successors or assigns, agree to pay all costs of such enf()rcement, including reasonable attorneys' fees. 12. If any portion of this Agreement is hcld invalid by a cOUl1 of competent jurisdiction, such dccision shall not affect the validity of any remaining portion of the Agreement. 13. In the event any covenant contained in this Agreement should be breached hy one party and subscquently waived by another party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach. 14. Notice or demand or other communication bctween or among thc pm1ies shall be SJH-200895v2 MN 190-41 5 . . . sufficiently given if sent by mail, postage prepaid, retum receipt requested or delivered personally: (a) As to the Authority: Housing and Redevelopment Authority in and for the City of Monticello 505 Walnut Street, Suite 1 Monticello, MN 55362-8822 Attn: Executive Director (b) As to the Developer: 15. This Agreement may be executed simultaneously in any number of counterparts, all of which shall constitute one and the same instrwnent. 16. This Agreement shall be govemed by and construed in accordance with the laws of the state of Minnesota. Any disputes, controversies, or claims arising out ofthis Agreement shall be heard in the state or iedcral courts of Milmesota, and all parties to this Agreement waive any objection to the jurisdiction of these courts, whether based on convenience or otherwise. 17. The Developer hereby agrees to protcct, defend and hold the Authority, the City and their officers, elected and appointed officials, employecs, administrators, commissioners, agents, and reprcsentatives harmless from and indcmnificd against any and all loss, cost, fines, charges, damage and expenses, including, without limitation, reasonable attorncys fces, consultant and expert witness fees, and travel associated therewith, due to claims or demands of any kind whatsoever caused by Developer or arising out of actions of Developer (and excluding those caused by or arising out of the Authority's or City's own acts or conduct) with regard to (i) the developmcnt, marketing, sale or leasing of all or any part of the Property, including, without limitation, any claims for any lien imposed by law for services, labor or materials furnished to or for thc benefIt of the Propcrty, or (ii) any claim by the state of Minnesota or the Minncsota Pollution Control Agency or any other person pertaining to the violation of any permits, orders, decrces or demands madc by said persons or with regard to the presence of any pollutant, contaminant or hazardous waste on thc Property; and (iii) or by reason of thc execution of this Agreement or thc performance of this Agreement. The Developer, and the Dcveloper's successors or assigns, agree to protect, defend and save thc Authority, and its officers, agents, and employecs, harmless from all such claims, demands, damages, and causes of action and the costs, disburscments, and expenses of defending the same, including but not limited to, attorneys fees, consulting enginecring services, and other tcchnical, administrative or profcssional assistance. This indemnity shall be continuing and shall survive the performance, termination or cancellation of this Agreement. Nothing in this Agreemcnt shaU be construed as a I imitation of or waiver by the Authority of any immunities, defenses, or other limitations on liability to which the Authority is cntitled by law, including but not limited to thc maximum monetary limits on liability establishcd by Minncsota Statutcs, Chapter 466. SJH-200H95v2 MNi,)O-4i 6 . . . IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed in its name and behalf and its seal to he duly affixed hereto and the Developer has caused this Agreement to be duly executed as of the day and year first above written. [NAME OF DEVELOPER] By Its: S./Fl-200895v2 MN190-41 7 . . . SJB-200895v2 MNI90-4! HOUSING AND REDEVELOPMENT AlJfHORITY IN AND FOR THE CITY OF MONTICELLO, MINNESOTA By Its Chair By Its Executive Director 8 SEP-29-2005 09=36 ~,9s05 THU 09:43 AM WSB & ASSOCIATES RL LARSON EXO [NO FAX NO. 320 654 1021 7635411700 P.01/02 P.01 .FlW~~~ , , _ _ 2:255 -- ......... .JI!I/II1IT -rl~ Aando!ph l.. lerson - Pres/oe'lt " 12tt: Stret<:( S.E. - s~. Cfotlc!, Mil'nesc~ S5.,."'.!4 FOCI 1354.1021 . Office $4.1)70$ \ - 31, INVOICE NO 415 ' ~ n -r' \':'''.-9,- \'(;> \JL ~ ~-=,'\ (~ C C -r--() :. ,.9 " B L L City of Monticello 505 W<;l.lnut '$treet , Monticello MN 55362 1 Suite T o 1,~' V'""" ?AG",- 1 "''''\ ~ 11I.,". , " ........ ~ \. ~2..). pl.. , ....-" , I ::"' " J o 13 M0513 Mis-c Work- Dahlheimer Dist ..- ' .:.nc N o /"') ) tr - r .)v \, t '.- , ;0'9/':'; 8':: ~ 0;,5 ' " .~ l~ ".. .. ..... . :415 :~: liivorCgfOATE< :, I, ',.,.'INVOIC:E NO~' "1, CU~TOMER..NO:'.: ( , ':-~' ::'~ .:: PAYMENT-TEAMS: '..' " ..:' ".'1.:" I.., . .':, CON;i~J:C.1'Nfi2.',,:" .,,'~' .~!:. ,"':~..-_~ " . -"~I"~ ~ ~~. <.". . .,".t . " .: i. ~ .':0, \' :"~'. .", -C' .,~ 1_ .'"'" '. " ,:'/1" ",1~~ ,". .;:' . "'+'. ,.,~. ":;,, " '.', " ..( . ,', " , " .,(' ","'~ .,' .":~ ",'.'. . ,:.: r':,\ ',:"'...;'.: :.~ :'~ ~.:~ .~..~; ". :~'~'.'" " '," ',' ,MONOO,l... '_';' .IJlJE[, IJPON,,:RECEI-P,+, ",', ...,.'.... ,,/ :~ .....1. ;... ":,. ,UNIT' /.PRICB " ":'EXTENDED' ""- ">:i#RYOEi ~-::~ :';r. .,' .D:;E;$.: '""""-'--~ ,', ;....; ,", .: ~;. ~ -. '. '.\.' , , . . , '.. ~ ,'. ~ .' , C.: "R::'.:i"::,~:-::~i:':.i:',:C{i1i,>:':L;::' ""/~>'" ;:' ;," . ~.~2:;g!LANq;].!~~,.::.~." .<',.'" ",'''' '.:; . , .. . ..", , ';,PRo'JECT' DAH:L.HElMER>'.DIST . .INe;.'", '.' ... '- :S1',ki~.piNG:'ibpsO,1L ;:' fR,OM' 'DAHLHEIMBE.\::,p:fSf:,:,XNC'.. ' ,;'.':. , .....,.... ", .. ',..' - ,.' ...._\ ,." -', -,.4,:,.(2:7.'(0;5: ....., , r ',:t " 'OOj;ll. 'FaX;fJ ':.' -,/"", ,"(6\i,.-::.j:(.~;:;_,~';:;'-~,;.:l:"::" ' ,'~, ~ :: ~ ....;~:~';:~~.:~~;: , Pl1On91 ',:, ):::ax:iI':,,' ". ....;'. n. n. ,,' "'. " . . " < " ':GROSS::.":':,: :'45' ,6oo'~"od' :;'. '-~~igj:~qg)::'" '" :",{ '\"" ,..'.':."'-',. "" , ;-.(l'cj :,.. "." 'i . , ., , .', . " ,. . ft_____~~_~.........______,__ F-"~P.~A;t :~AXe:7.;~l ..1.I'\NUiSON &: ASSOCIATES. tNi':;. (t.L~n !'"f1.7I1fi (IN";RI171R?l '1 :'1" .,' ":st!~J~: ',' '45 rQ.Oa;;:'0Q,;:, ... " , , " . ,,','" "'.".n.. , .,.' " . : '.; "" ~.- '..;: . ..:" ....' .. .... . ...~', ~i .,.... :. ',.' ~ .' .. , \' .~., " ' .. n. . , ~, ~" '"."" "',;.' :\:. ,.,.'.:.': ...1.,'. .:y .' - 'l;'1'QC '.00:..' . >'N:ET', A1i.1P:UN!l;\;')- '45 ;,:q.O:O:.~.:q:q;, . .r'....... . LHB, Inc. 21 West Superior Street, Suite 500 Duluth, MN 55802 Phone: 218.727.8446 ~\':> ~s.'?\'1'1 l..\lPCS ,)-;- 0 S (1- \ b. \ . City of Monticello Attn: Olive Koropchak 505 Walnut Street Suite #1 Monticello, MN 55362 October 11, 2005 Project No: 050341.10 Invoice No: 0000002 Project 050341 ,10 Hourly Not to Exceed $5,400,00 plus mbursable Expenses PrOYfi5Siolial Servic2sfrom September 1. 2005 to September 30. 2005 Professional Personnel Hours Rate Amount Principal Fischer, Michael 12.00 171.00 2,052.00 Putnam, Jerry 6.00 105.00 630.00 Landscape Arch. Chalupsky, Bruce 6.50 91.00 591.50 . Administration Kurki, Terza 3,25 61.00 198.25 Totals 27,75 3,471.75 Total Labor 3,471.75 Reimbursable Expenses Mailings/Deliveries Total Reimbursables 28.87 28.87 28.87 Unit Billing In-House Printing - Mpls Total Units 670.0 Copies @ 0.15 100.50 100.50 100.50 Total this Invoice $3,601.12 Labor Expense Unit Totals Current 3,471.75 28.87 100.50 3,601.12 Total 5.043.25 88,95 114,00 5,246.20 Billings to Date . Approved By: \"fP{l~ · &1. . . Ehlers & Associates, Inc. leaders in Public Finance 3060 Centre POinte Drive Roseville, MN 55113 (651) 697-8500 Financial Advisory Services Invoice ?\:'. ~ \. ?,C{<q l..\ \." ~ 0 . .., 0 - o~ \ t - .;- City of Monticello 505 Walnut Street, Suite 1 Monticello, MN 55362-8822 Invoice #: Invoice Date: 331458 October 10, 2005 Project: General Date Worked k MTR MTR MTR 09-01-2005 09-22-2005 09~23-2005 ~ ~ DescriPtion of Services Hours Amount 250.00 93.75 62.50 $406.25 I Amount Due This Invoice $406.25 (Detach at perforation and return lower portion to Ehlers & Associates, Inc.) Meeting on industrial park accounting Discussions with Suntide Times numbers for redevelopment 2.00 .75 ------dQ 3.25 City of Monticello Invoice #: 331458 Invoice Date: October 10, 2005 IA;-~unt Due T~i;~_~~_ice -_~-_~______:_:-_____~~~~~~~ l Please remit payme~t~ Ehlers ~ AsSOclates.ln~.-.- Attn: Accounts Receivable 3060 Centre Pointe Drive Roseville, MN 55113 -- - ,~--- ---- --- .=:o~ Rece~~ j . Ehlers & Associates, Inc. leaders in Public Finance 3060 Centre Pointe Drive Roseville, MN 55113 (651) 697-8500 Summary Statement Monticello Housing And Redevelopment Authority 505 Walnut Street, Suite 1 Monticello, MN 55362-8822 Statement Date: October 10, 2005 Proiect Amount Invoice # General TIF District No. 1-35 - Redevelopment $1,162.50 $2,250.00 331459 331460 Total for this statement $3,412.50 . ~c,:~ \ fl'.." Tr-. p. 'A.V? 011 . ......,.." i U /"'\ T. ~ c...... Code: ~ \ \ I _ \ V\cs.t~ l\:> I nitia! ~ lb - 1 ~ - () S .'", i ! '. \ "". , ' '" ;~ i \i .' 'I i ~ .~, ~~." r:~."'.~~,..~W.7' J~~~ ~"~,~t'; :,_. ;" ",~ ~ :. . ..~..::,:~..::.....J I '.", , \;.......,.~~"O, '"' . . . Ehlers & Associates, Inc. Leaders in Public Finance 3060 Centre Pointe Drive Roseville, MN 55113 (651) 697-8500 Financial Advisory Services Invoice Monticello Housing And Redevelopment Authority 505 Walnut Street, Suite 1 Monticello, MN 55362-8822 Invoice #: Invoice Date: 331459 October 10, 2005 proieG Date Worked k Descriotion of Services Hours 09-19.2005 09-19-2005 09-22-2005 ED BMD ED Attended Meeting: Excess tif discussion with 0 Koropchak Attended Meeting: and updated TIF proforma Reviewed: Excess increment comments from OSA letter and research, discuss with S Koropchak Prepared: Times Redevelopment cashflow -L.QQ 8.50 09-23-2005 ED "DO \ · 1'1-. l.\lt. '}.\ "J' ~mount Due Thi;inv_oice '?\Q9 Amount 3.00 2.00 2.50 375.00 350.00 312.50 125.00 $1,162.50 . $1 ,162.50-1 (Detach at perforation and return lower portion to Ehlers & Associates, Inc.) Monticello Housing And Redevelopment Authority Invoice #: Invoice Date: Amount Due This Invoice 331459 October 10, 2005 $1,162.50 I Please remit payment to: Ehlers & Associates, Inc. Attn: Accounts Receivable 3060 Centre Pointe Drive Roseville, MN 55113 Due Upon Receipt . . . Ehlers & Associates, Inc. Leaders in Public Finance 3060 Centre Pointe Drive Roseville, MN 55113 (651) 697-8500 Financial Advisory Services Invoice Monticello Housing And Redevelopment Authority 505 Walnut Street, Suite 1 Monticello, MN 55362-8822 Invoice #: Invoice Date: 331460 October 10, 2005 Project: TIF District No. 1-35 - Redevelopment Date Worked..fu.. Descriotion ot Services MTR Establishment ot TIF District No. 1-35 (2nd Halt) I Amount Due This Invoice y~ S?> S .7> \ q q ~\~ ~ Hours Amount 2.250.00 $2,250.00 ~2,250:~~J (Detach at perforation and return lower portion to Ehlers & Associates, Inc.) Monticello Housing And Redevelopment Authority Amount Due This Invoice Invoice #: Invoice Date: 331460 October 10, 2005 $2,250.001 Please remit payment to: Ehlers & Associates, Inc. Attn: Accounts Receivable 3060 Centre Pointe Drive Roseville, MN 55113 Due Upon Receipt . . . ORA Agenda - 11/02/05 8. Executive Director's Report. a) Landmark Square n - HRA Contract amended to read: "The $20,000 grant will be paid, without interest, within 30-days after the date that the developer provides evidence satisfaetory to the Authority as follows: proof of payment fo the acquisition and garagc removal costs, completion ofthc parking improvements, and submission of lien waiver(s) from any contractors employed by the developer for activities undertaken." Received a copy of the bank commitment for construetion financing. Still need copy of "proof of parking". My understanding Barry has purchased the Opal Stokes home. Brad Johnson has informed me thc project costs have incrcased due to the requirements by the city for added landscaping, pavers, and diagonal street parking. Thcy are looking at redueing the quality of the finished produet or open to other fundi ng options. b) Rocky Mtn Group LLC (Dahlheimer) - The License Agreement was amended to extend the termination date to October 31, 2005, allowing redeveloper to continue construction of walls and roof structure. The closing has been delayed again because of title issues. The termination date is now extcnded to November 7,2005. c) Twin City Die Castings - TCDC plans to and had approval to construct outdoor storage: concrete slab, fencing and landscaping. Due to the revised application requirements and process, the application is now incomplete, requiring drainage and utility information. Now scheduled for the December Planning Commission cycle. TCDC was awarded the $270,000 Training Grant on October 24. Training will take place at the Monticello facility over the next three years. The EDA authorized preparation of loan guidelines for the TCDC Federal payback dollars: a lower interest rate etc. than the GMEf guidelines to encourage businesses to use dollars. federal dollars require applicants to meet some IIUD criteria. d) Manufacturer of Cood bases, sauces, and seasonings - Paul Kleinwachter, John Simola, and Koropchak visited this company located in Dayton on September 21. The 1956 family-owned business is looking to construct a 20,000 sq ft facility on approximately 2-acrcs spring 2006. With no adverse impact to the Waste Water Treatment Plant, a proposal and cover letter was mailed to the company. Paul, thanks for your nice Ictter. Total oftwcnty full-time permanent jobs at an average wage-level of at least $20.70 ph without benefits. Sixteen jobs out of the MN facility. Their contractor, Keystone Design Build, stopped in the City Hall for information. Company doing bio~testing this week. Down to Monticcllo and Osseo. e) Tapper's Holding Company - The approved GMEF Loan of $200,000 is scheduled to close on November 1. The EDA loan is in 5th position behind the CMIF. This decision was made because with a shared position, the CMIF required an Intercredit Agreement and the lender advised against the shared position. f) Fiber Optic Task Force began development of a request for proposal (RFP) on September 29. Their next meeting is November 17. g) Copy of the response letter to OtTice of State Auditors regarding questions on the . HRA Agenda - 11/02/05 . 2003/2004 TIF reports. h) Survey by League of Minnesota Cities - Compiling data from communities who have used eminent domain for purpose other than public improvements. (I IRA-O'Connor parcel in 2001). LMC requesting to use city as case study. i) Follow-ups - 200,000 sq ft manufacturer - United Properties (no response) Great River Energy Headquarter Building - Looking f()[ 60 acres. Elk River offered 60 acrcs for $1 but not intercsted. New Prcsident wants Maple Grove area for image purpose. 30,000 sq ft machine shop (gave offer/not interested) I'm OK with this. 60,000 sq ft builder of dump bodies, grain bodies, and trunk hoists. Responded with first preliminary information and talked via phone. Needs outdoor storage. 10,000 sq ft uscr - reviewing for compliance. (Billboard) 17,000 sq ft user - requested completion of application. (BiIlboard through builder) Invited to participate in the Minnesota Real Estate Seminar in Minneapolis in December. j) Marketing Committee - Mailed post cards to about 60 precision machining and medical cquipment companies. Ad in Minneapolis Sunday paper classified ads. Will schcdule meeting to visit site and re-Iook at site development and assess dollars spent to date. k) A VR - The Planning Commission denied the re-zonc from II-A (Light Industrial) to 12 (1leavy Industrial). The Council over-turned the Commission and voted 4-1 to re-zone to Ilcavy Industrial. Council member Mayer voted against. The city has made an offer to ^ VR for their existing property and approximately 12-acres on the city-owned industrial land. I) Chelsea Road extension - The rain delayed the reconstruction and realignment of 90th Strcet at Chelsea Road. The utility and road/curb construction appears complete. Finaljift to the road will be in the spring. Chadwick and myself checking on ribbon cutting event the morning of No v 2. m) Billboard lease on liRA property - Copy of Rick's letter. n) TIF Newsletter. 0) ORA commissioners drive by the property located at 107 Locust Street. Brad .Johnson said they were contacted about acquiring this property. They are not interested but would be willing to be middle person if HRA is interested in property. Will discuss at meeting. p) Beginning in January, the Planning Commission will add a second meeting date on the yd Tuesday of every other month for the purpose to commence discussion and plans for general planning as it relates to updating the comp plan, park development, and downtown rcdevelopment etc. All eommissions should be aware of this and assume will be involved in the process. . 2 ~~~ .. , .1"" ~ ~ i J tm October 7,2005 MONTICELLO Mr. Kurt Mueller Office of the State Auditor TIF Division 525 Park Street, Suite 500 St. Paul, MN 55103 Dear Mr. Mueller: 'J'hank you for your letter of September 21, 2005, acknowledging the City of Monticello's accurate reporting and notification of a few problems within the 2003/2004 TIF reports. Each question or comment is addressed by either an explanation and/or an amendment to 2004 TIF Report. . TIF District No. 1-5. Attached are the January 22, 1996, and June 24, 1996, modification of the budgets for District No. ] -5. 'rhe paragraph in the center of Page 1-33 notes that tax increment may be used to pay public improvements, interest on bonds or other obligations. Therefore, this is how the city arrived at the $4,365,000 ($625,000+$990,000+$2,750,000) cumulative tax increment amount reported on line 24, column B, of the 2004 TlF report. It is the City's intent to spend the district's cash on either downtown redevelopment and/or acquisition and public improvements associated with the development of the city-owned industrial park aU located within the Project boundaries. TIF District No. 1-6. The outstanding bond payments are made in accordance to the Bond and Interest Payment Record. Additionally, there are outstanding projects to be completed; therefore, the TIF District No. 1-6 has not been decertified. TIF District No. 1-22. Attached is an amendment to the 2004 Report noting the $39,000,000 budgeted amount of bond proceeds and copy of Notes to OSA 2004 explaining the refinancing of the temporary bond. TIF Distriet No. 1-31. See the attached 2004 TIF Report reporting the pay-as-you-go obligations on lines 74 through 80, Page 5, of the Report. . TIF Distriet No. 1-14. See attached copy ofTIF Plan, Page XV-5, Subsection 15.17 Estimated Amount of Bonded Indebtedness. Monticello City Hall, 505 Walnut Street, Suite I, Monticello, MN 55362-8831 . (763) 295-2711 . Fax: (763) 295-4404 Office of Public Works, 909 Golf Course Rd., Monticello, MN 55362 . (763) 295-3 I 70. Fax: (763) 271-3272 . . . Mr. Kurt Mueller Office of the State Auditor Page 2 TIF District No. 1-23. Attached is an amendment to the 2004 Report noting the amended revenue budget. TIF District No. 1-24. Attached is an amendment to the 2004 Report noting the amended revenue budget. TIF District No.. 1-26. See attached copy of the TIF Plan and amendment to the 2004 Report noting the amended revenue budget. TIF District No. 1-28. Attached is an amendment to the 2004 report noting the amended expenditure budget. Other Information. For the TIF Districts decertified in 2004, Check No. 80091 dated October 14, 2004, was issued to Wright County Auditor reimbursing the tax increment. In December, the Finance Department reports the annual interest income. Therefore, with the districts decertified and reimbursement paid to the County in October, no interest income was reported for 2004. Again, thank you for bringing these problems to my attention. Should you have additional questions, please call me at 763-271-3208. Sincerely, HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MONTICELLO c:Jj0~., \ "/~ \~~.~ /'\ .. I I ""\ t,l .~ v"---~--~ Ollie Koropchak Executive Director c: Rick Wolfsteller, Administrator 2004 TlF Report File LMC eminent domain case studies Page 1 of 1 ~\c Ollie Koropchak . From: Walker, Rachel [RWalker@LMNC.ORG] Sent: Monday, October 24,20053:15 PM To: Ollie Koropchak Subject: LMC eminent domain case studies Hello Ollie, Thank you for taking the time to share your city's experiences with eminent domain with us. Over the last few weeks, we have developed in-depth case studies of the use of eminent domain for economic development/redevelopment/housing by about 18 cities across the state These case studies will be critical in the League's efforts to defend cities' authority to use eminent domain in the future The League is working on a multi- faceted strategy to emphasize the importance of this tool for redevelopment and other projects. As we move forward in that effort, we hope to use the case studies in a variety of ways with different audiences, including: Educational materials and forums for League member cities One-on-one meetings with Legislators; handouts and other communication pieces for legislators Testimony at Legislative hearings Meetings with the Media Contributing to National League of Cities communication materials on eminent domain Handouts and other communication pieces for Other advocacy groups Sessions at the LMC Annual Conference . We are asking permission to use your city's case study in one or more of the ways listed. We will follow-up this email via phone calls in the next few days. If you have any suggestions for how we can most effectively use the case studies, please share those ideas. Thank you Eric Willette Rachel Walker willette@lmnc.org rwalker@lmncorg 651-281-1245 651-281-1236 Rache! Walker Policy Research Assistant league of Minnesota Cities rwalker@lmnc.org 651-281-1236 . n_ __ _"','... ,_ This email has been scanned by the MessageLabs Email Security System. For more information please visit http://www.messagelabs.com/email . 10/24/2005 <Z (Y\ . October 25, 2005 MONTICELLO Mr. Raymond Kosis, General Manager Tri-State Outdoor Media Group, Inc. PO Box 1247 Titton, GA 31793 Re: Billboard Leases - 1-94/TH 25 - Permit # 3-4603, 3-4430 and 3-4389 Dear Mr. Kosis: The City of Monticello Housing Authority has three real estate lease agreements with Tri-State Outdoor Media Group for the location ofthree billboard signs on the HRA land. These lease agreements are for a period of one year each with the right to renew for an additional like period with each lease agreement expiring December 3 I ,( of each year. . In order to cover increased costs that the HRA is incurring on this property and to keep in line with current market rate conditions for billboard locations, the Monticello HRA will be increasing the annual lease rental payments substantially beginning with the year 1-1-06. The current lease rates are substantially below the prevailing market rate and the future rental rates will need to be adjusted to $7,000 annually for the double sided billboards and $4,000 for the single sided structure. In addition, for year beginning January I, 2007, the above amounts shall be increased by a 4% inflation factor for each billboard that remains. If you would like to prepare a new lease agreement for each ofthe three billboard sites using the above information and also including the inflation of factor of 4% annually after January 1,2007, please forward the leases to the Monticello HRA for approval. If you would prefer, the City of Monticello can prepare lease agreements and forward them to you for signatures. Ifnew lease agreements are not negotiated and approved by November 30, 2005, this letter constitutes the City of Monticello Housing Authority's notice that the existing lease agreements will be terminated on their expiration date of 12-31-05. The HRA looks forward to continuing our relationship with your company in the years ahead. Sincerely, CITY OF MONTICELLO O~ {{//~1V\. Rick Wolfsteller /' City Administrator . ~ Ollie Kor9pcha~, HRA Director Lease File Monticello City Hall, 505 Walnut Street, Suite I, Monticello, MN 55362-8831 . (763) 295-2711 . Fax: (763) 295-4404 Office of Public Works, 909 Golf Course Rd., Monticello, MN 55362 · (763) 295-3170 . Fax: (763) 271-3272 . . . C(; f\ , October 2005 Tax Increment Financing Division Newsletter . TIF Technical Amendments: Date Adjustment . Minnesota Legal Compliance Audit Guidejor Local Government . Interfund Loan Requirementsjor TIF Expenditures . Clar{fkalion: Tip From Authority Recently Audited TIF Technical Amendments: Date Adiustmcnt During the 2005 Legislative Session, the 50-80 income test tt1r rental properties (Minn. Stat. S 469.176 I, subd. 3) was repealed. The effective date for this provision is June 30, 2004. Since it was not the intent of the legislature to make the repeal apply retroactively, please note that the effective date for the repeal should be June 30, 2005. Minncsota LC2al Compliance Audit Guide for Local Covcrnmcnt The office of the State Auditor is expanding its Legal Compliance Audit Guide to include '1'1(<"- related topics, includi ng TI F district decerti fieation and segregation of '1'1 F funds. We anticipate the newly expanded guide to be ready by the end of October on our website under the "Educational Materials" hyperlink at ww\v.auditor.state.mn.us. Interfund Loan RCQuirements for TIF Exuenditures ^ participant at the MNCPA Audits of Local Governments Con ference asked why the TI F Division requires the terms and conditions for repayment of interfund loans tor TIF expenditures be in writing and authorized by council resolution. Others, as well, may be interested in the answer. The TIF Act was amended in 200 I to require that loans from the general (or other) fund to finance TIF expenditures must be authorized by resolution before money is transferred, advanced, or spent. The terms of repayment must be in writing and include (i) the principal amount of the loan, (ii) the interest rate, and (iii) the maximum term. This TIF amendment is effective tor loans and advances made after July 31, 2001 tor all post-1979 TIF districts. See Minn. Stat. S 469.178, subd. 7 for details. Clarification: Till From Authority Recentlv Audited We wish to clarify that when a TIF audit is in progress, the audit and its clements are contidential. Financial information of an authority is always public and can be disclosed by an authority to the county attorney if an authority wishes to discuss and make efforts to correct an applicable matter. ~lYOU have any questions please contact us: Arlin Waelti 651-296-7979 Arlin. Waclli:il;slalc.rnn 11.1' Kurt Mueller 651-297-3680 Kllrl, MucLL('r(ii\~1.g!.f!!1!LI!~ Usa McGuire 651-296-9255 rf.\'I! AflJ,uin'@Vf,!!.elnnus Suk Shah 651-296-7001 SI!LSbJlhd)sralc, mn, us Marsha Pattison 651-2%-4716 Marsha.PattisOlZ@,llq!s.J!!.j1,Us Maggie Gebhard 651-2%-7446 Marzrzic, Cicbharq(i]:slalc, mn.lIs