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HomeMy WebLinkAboutEDA AGN 09-16-03CITY OF COLUMBIA HEIGHTS 590 40th Avenue N.E.. Columbia Heights. MN 55421-3878 (763) 706-3600 TDD (763) 706-3692 Visit Our Website at: www. ci. co/ttmbia-heights.mn, us EDA COMMISSIONERS Don Murzyn Jr. Patricia Jindra Julienne Wyckoff Bruce Nawrocki Bobby Williams Tammera Ericson Bruce Kelzenberg ECONOMIC DEVELOPMENT AUTHORITY REGULAR MEETING 7:00 P.M., TUESDAY, SEPTEMBER 16, 2003 CITY HALL, CONFERENCE ROOM 1 AGENDA CALL TO ORDER/ROLL CALL PLEDGE OF ALLEGIANCE. CONSENT AGENDA. (These items are considered to be routine by the EDA Board of Commissioners and will be enacted as part of the Consent Agenda by one motion.) MOTION: Move to approve the consent agenda items as listed below: 1) Approve EDA Meeting Minutes for August 20, 2003. MOTION: Move to approve the minutes of August 20, 2003 regular EDA Meeting as presented. 2) Approve the Financial Report and Payment of Bills MOTION: Move to approve Resolution 2003-14,'a Resolution of the Columbia Heights Economic Development Authority (EDA) approving the financial statement and payment of bills for the month of August, 2003. 4. ITEMS FOR CONSIDERATION A. 40th & University Adopt Resolution 2003-15, Modifying the CBD Revitalization Plan for the CBD Redevelopment Project, establishing the Kmart/Central Avenue TIF District and Adopting a TIF District MOTION: Move to waive the reading of Resolution 2003-15, there being an ample amount of copies available to the public. MOTION: Move to Adopt Resolution 2003-15, a Resolution Adopting a Modification to the Downtown Central Business District (CBD) Revitalization Plan for the CBD Redevelopment Project and establishing the Kmart/Central Avenue Tax Increment Financing District therein and Adopting a Tax Increment Financing Plan; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. Adopt Resolution 2003-16, Approving a Contract for Private Redevelopment between the Columbia Heights Economic Development Authority and New Heights Development, LLC MOTION: Move to waive the reading of Resolution 2003-16, there being an ample amount of copies available to the public. THE CITY OF COLUMBIA HEIGHTS DOES NOT DISCRIMINATE ON THE BASIS OF DISABILITY IN EMPLOYMENT OR THE PROVISION OF SERVICES E]QUAL OPPORTUNITY EMPLOYER MOTION: Move to Adopt Resolution 2003-16, a Resolution Approving a Contract for Private Redevelopment between the Columbia Heights Economic Development Authority and New Heights Development, LLC; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. D. 39th & Central Redevelopment E. N.E.I. Proposal ADMINISTRATIVE REPORTS ADJOURNMENT Walter R. Fehst, Executive Director H:\edaAgenda2003\ The EDA does not discriminate on the basis of disability in the admission or access to, or treatment or employment in, its accommodation will be provided to allow individuals with disabilities to participate in all EDA services, programs, and activities. Auxiliary aids for handicapped persons are available upon request when the request is made at least 96 hours in advance. Please call the EDA Secretary at 706-3669 to make arrangements (TDD 706-2806) for deaf or hearing impaired ECONOMIC DEVELOPMENT AUTHORITY (EDA) REGULAR MEETING MINUTES AUGUST 20, 2003 CALL TO ORDER/ROLL CALL Vice President, Jindra called the meeting to order at 9:12 p.m. and then turned the meeting over to Tammera Ericson, Treasurer. Present: Patricia Jindra, Julienne Wyckoff, Bobby Williams and Bruce Nawrocki, Tammera Ericson, and Bruce Kelzenberg Absent: Don Murzyn Jr. PLEDGE OF ALLEGIANCE CONSENT AGENDA Approval of Minutes Financial Report and Payment of Bills MOTION by Nawrocki, second by Williams, to adopt the consent agenda items as listed. All ayes. Motion Carried. ITEMS FOR CONSIDERATION Adopt Resolution 2003-12 & 2003-13~ Budget and Levy for 2004 Streetar stated staff has prepared the 2004 Budget and Levy documents for board adoption. The 2004 Community Development Budget Resolution 2003-12 is $222,648for the Budget and an additional $84,965 for the Levy. Resolution 2003-13 is approving and levying a total of $137,683 in funding. The budget and levy resolutions are based on two priorities that City Council has expressed to staff' 1) Redevelopment of Central Avenue and 2) Industrial Park Redevelopment project. In order to achieve these goals these funding sources are very important. The 2004 Levy combined is $30,000 less than last year. Streetar asked the boardmembers three questions: 1) do you like the direction staff is going; 2) would they approve the Budget; and 3) wouM they approve the Levy. Williams, Ericson, Wyckoff Kelzenberg, and dindra all agreed that staff was going to the right direction with redevelopment of the City and felt comfortable approving the budget and levy for 2004. Wyckoff asked if there is a way the City can tax residents for redevelopment. Streetar stated he wasn't aware of this but, would check with Bubul. Nawrocki questioned why the EDA was approving an HRA levy and is the $137,683 the maximum amount the City can Levy. Streetar stated Steve Bubul has verified the EDA can Levy for the HRA, that the HRA could not levy anything as the funds would have to be used on repairs or housing, which are covered in the rents received at Parkview Villa and that this is the maximum amount the City can levy. MOTION by Williams, second by Wyckoff to waive the reading of Resolution 2003-12, there being an ample amount of copies available to the public. All ayes. Motion Carried. MOTION by Wyckof-f second by Kelzenberg, to Adopt Resolution 2003-12, a Resolution of the Columbia Heights EDA Adopting the 2004 Budget of $222,648 and a Levy of $84965 and recommending this budget and levy to the City Council for approval. Upon Vote: ,lindra- Aye, Kelzenberg- Aye, Williams- Aye, Wyckoff- Aye, Ericson- Aye, Nawrocki- Nay. Motion Carried. Economic Development Authority Meeting Minutes August 20, 2003 Page 2 of 2 MOTION by Ericson, second by Williams, to waive the reading of Resolution 2003-13, there being an ample amount of copies available to the public. All ayes. Motion Carried. MOTION by Ericson, second by Williams, to Adopt Resolution 2003-13, a Resolution of the Columbia Heights EDA Approving and levying $137,683, subject to approval by the City Council. Upon Vote: ,lindra- Aye, Kelzenberg- Aye, Williams- Aye, Wyckoff- Aye, Ericson- Aye, Nawrocki- Nay. Motion Carried. ADMINISTRATIVE REPORTS 40th & University Avenue Schumacher passed out a Preliminary Development Proforma and stated Paul Reinke of the Haugland Company met with staff to negotiate the development proforma. The proposed "Heights Shops" will have project rents approximately $14.50/net rentable square feet, based building costs of $80/square foot and a tenant improvement allowance of $15. O0/square foot. The land cost is estimated at $50,000 less the demolition cost. The Preliminary Development Proforma contains $58,500 in land costs; $779,500 in building costs; $207,700 in development costs; $24,200 in contingency costs;for an estimated total development cost of $1,069,900. If the EDA supports these parameters, Haugland Company will pursue Pre-Lease Agreements before entering into a final development. The owner of 322 40th Avenue (MGS) has agreed to have the Anoka County Assessor evaluate his property in order to obtain a more viable market value. Nawrocki asked what the appraisal amount was and would the City sell the property for the same amount invested in it. Schumacher stated the five properties were appraised in excess of $1.5 million, the City would sell the properties for less than the Estimated Market Value as this project was totally funded with CDBG dollars. Ericson requested staff review the proforma. Kmart Redevelopment Streetar passed out the Project Summary books prepared by DSU and Ehlers for review. He invited Boardmembers to attend a joint worksession in the City Council Chambers on September 4th at 7p.m. for the City Council, EDA, Planning Commission and Kmart Advisory Group regarding the redevelopment site. Streetar requested boardmembers read over the rest of the Administrative Report included in the packet and contact staff with any questions or concerns. ADJOURNMENT Meeting was adjourned at 10:10 p.m. Respectfully submitted, Cheryl Bakken Community Development Secretary H:~EDAminutes2003\8-20-2003 mmm ~ X X X X X X X ~ X X X X X X X COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) Meeting of: September 16, 2003 AGENDA SECTION: Consent Agenda ORIGINATING EXECUTIVE NO: DEPARTMENT: EDA DIRECTOR APPROVAL ITEM: Financial Report and Payment of Bills BY: Bob Streetar BY: DATE: September 9, 2003 BACKGROUND: The bound Financial Report for August 1, 2003 draft Resolution 2003-14 is attached for review. The enclosed Financial Report lists the Summary (white), the Expenditure Guideline with Detail (green) and Revenue Guideline with detail (yellow) for each fund and department. The report covers the activity in the calendar (fiscal) year from January 1 through August 31, 2003. RECOMMENDATION: Staff will be available to answer specific questions. If the report is satisfactorily complete, we recommend the Board take affirmative action to receive the Financial Report and approve the payment of bills. RECOMMENDED MOTION: Move to approve Resolution 2003-14, Resolution of the Columbia Heights Economic Development Authority (EDA) approving the Financial Statement and Payment of Bills for the month of August, 2003. EDA ACTION: H: Consent2003\AugustFinRep2003 EDA RESOLUTION 2003-14 RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) APPROVING THE FINANCIAL STATEMENT FOR AUGUST, 2003 AND PAYMENT OF BILLS FOR THE MONTH OF AUGUST, 2003. WHEREAS, the Columbia Heights Economic Development Authority (EDA) is required by Minnesota Statutes Section 469.096, Subd. 9, to prepare a detailed financial statement which shows all receipts and disbursements, their nature, the money on hand, the purposes to which the money on hand is to be applied, the EDA's credits and assets and its outstanding liabilities; and WHEREAS, said Statute also requires the EDA to examine the statement and treasurer's vouchers or bills and if correct, to approve them by resolution and enter the resolution in its records; and WHEREAS, the financial statement for the month of August, 2003 and the list of bills for the month of August, 2003 are attached hereto and made a part of this resolution; and WHEREAS, the EDA has examined the financial statement and the list of bills and finds them to be acceptable as to both form and accuracy. NOW,THEREFORE BE IT RESOLVED by the Board of Commissioners of the Columbia Heights Economic Development Authority that it has examined the attached financial statements and list of bills, which are attached hereto and made a part hereof, and they are found to be correct, as to foITn and content; and BE IT FURTHER RESOLVED the financial statements are acknowledged and received and the list of bills as presented in writing are approved for payment out of proper funds; and BE IT FURTHER RESOLVED this resolution and attachments are to be made a part of the permanent records of the Columbia Heights Economic Development Authority. Passed this __ day of ,2003. MOTION BY: SECONDED BY: AYES: NAYS: Don Murzyn Jr., President Attest by: Cheryl Bakken, Assistant Secretary H:\Resolutions2003\EDA2003-14 DATE: TO: FROM: RE: September 12, 2003 EDA Commissioners Randy Schumacher, Community Development Assistant 40th & University Avenue The EDA selected and granted the Haugland Companies an exclusive to develop the one-acre site at 40th and University, into a single use, or multi-use tenant development. In addition, Commissioners established the following development objectives: · Upscale development with single or multi-use tenant. · No fast food or auto related uses. · Uses that would provide and improved image, vitality and needed services along University Avenue. In order to move ahead with the development that meets the Commissioners objectives, the developer has requested the City sell the land for $50,000. At the meeting in August, Commissioners directed staff to determine if a higher sale pdce is possible. Staff had Ehlers and Associates, Inc. review the pro-forma and their findings determined that: · Construction costs and development fees are within industry standards, and indicated the consbuction proposed by the Haugland Companies is of high quality. · The vacancy rate of 5% is within industry standards. · Lease rate of $14.50 sq/ft is within the Columbia Heights market, but is somewhat on the high side. If Commissioners want a project that meets the objectives initially established, then staff recommends selling the land for $50,000. If Commissioner would rather achieve a higher price, that is achievable by allowing uses Commissioners initially indicated they did not want such as fast food and auto related uses. These types of uses can pay more for land because their sales are greater. Commissioner's options are: 1. A higher quality building that improves the image of the City and provides neighborhood services and a little less money;, or 2. A lower quality image and a little more money?. Staff recommends option 1. Stall requests definitive direction on this question. Paul Reinke, representing Haugland Company will be present at the EDA meeting to address any questions the board may have relating to this project. H:\Redevelopment2.003\40~ & Univ. COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) Meeting of: September 16, 2003 AGENDA SECTION: Items for Consideration ORIGINATING EXECUTWE NO: 4-B DEPARTMENT: EDA DIRECTOR APPROVAL ITEM: Adopt Resolution 2003-15, Adopt BY: Robert Streetar BY: Resolution 2003-15, Modifying the CBD DATE: September 10, 2003 Revitalization Plan for the CBD Redevelopment Project, establishing the Kmart/Central Avenue TIF District and Adopting a TIF District BACKGROUND: Please find attached the Tax Increment Financing (TIF) Plan (the "Plan") for the establishment of the Kmart/Central Avenue Tax Increment Financing District. The Plan is required and describes the purpose for, and the amount of, the tax increment assistance. The Plan has been reviewed by the City's financial council Mark Ruff of Ehlers and Associates, Inc., and by the City's legal council, Steve Bubul of Kennedy and Graven, Inc. Please find attached a summary of the tax increment assistance. On September 22, 2003 at a regular meeting of the City Council, there will be a public hearing the on Plan. Mark Ruff will be present at the September 16, 2003 EDA meeting to answer questions. RECOMMENDATION: Staff recommends Adoption of Resolution 2003-15, a resolution making a modification to the downtown central business district (CBD) revitalization plan for the CBD redevelopment project and establishing the Kmart/Central Avenue tax increment financing district therein and adopting a tax increment financing plan therefore, and recommend to the City Council at their September 22, 2003 meeting the same. RECOMMENDED MOTION: Move to waive the reading of Resolution 2003-15, there being an ample amount of copies available to the public. RECOMMENDED MOTION: Move to Adopt Resolution 2003-15, a Resolution Adopting a Modification to the Downtown Central Business District (CBD) Revitalization Plan for the CBD Redevelopment Project and establishing the Kmart/Central Avenue Tax Increment Financing District therein and Adopting a Tax Increment Financing Plan; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. Attachments: Tax Increment Financing Plan Summary of Tax Increment Assistance EDA ACTION: consent Form2003\EDA TIF District for Kmart COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY CITY OF COLUMBIA HEIGHTS COUNTY OF ANOKA STATE OF MINNESOTA RESOLUTION NO. 2003-15 RESOLUTION ADOPTING A MODIFICATION TO THE DOWNTOWN CENTRAL BUSINESS DISTRICT (CBD) REVITALIZATION PLAN FOR THE CBD REDEVELOPMENT PROJECT AND ESTABLISHING THE K- MART/CENTRAL AVENUE TAX INCREMENT FINANCING DISTRICT THEREIN AND ADOPTING A TAX INCREMENT FINANCING PLAN THEREFOR. WHEREAS, it has been proposed by the Board of Commissioners (the "Board") of the Columbia Heights Economic Development Authority (the "EDA") and the City of Columbia Heights (the "City") that the EDA adopt a Modification to the Downtown CBD Revitalization Plan for the CBD Redevelopment Project (the "Revitalization Plan Modification") and establish the K-Mart/Central Avenue Tax Increment Financing District and adopt a Tax Increment Financing Plan (the "TIF Plan") therefore (the Revitalization Plan Modification and the TIF Plan are referred to collectively herein as the "Plans"), all pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469.090 to 469.1082, and Sections 469.174 to 469.1799, inclusive, as amended (the "Act"), all as reflected in the Plans and presented for the Board's consideration; and WHEREAS, the EDA has investigated the facts relating to the Plans and has caused the Plans to be prepared; and WHEREAS, the EDA has performed all actions required by law to be performed prior to the adoption of the Plans. The EDA has also requested the City Planning Commission to provide for review of and written comment on Plans and that the City Council schedule a public hearing on the Plans upon published notice as required by law. NOW, THEREFORE, BE IT RESOLVED by the Board as follows: 1. The EDA hereby finds that the K-Mart/Central Avenue Tax Increment Financing District is in the public interest and is a "renewal and renovation district" under Minnesota Statutes, Section 469.174, Subd 10a, and finds that the adoption of the proposed Plans conform in all respects to the requirements of the Act and will help fulfill a need to develop an area of the State of Minnesota which is already built up and that the adoption of the proposed Plans will help provide employment opportunities in the State and to improve the tax base of the City and the general economy of the State and thereby serves a public purpose. 2. The EDA further finds that the Plans will afford maximum opportunity, consistent with the sound needs for the City as a whole, for the development or redevelopment of the project area by private enterprise in that the intent is to provide only that public assistance necessary to make the private developments financially feasible. 3. Conditioned upon the approval thereof by the City Council following its public hearing thereon, the Plans, as presented to the EDA on this date, are hereby approved, established and adopted and shall be placed on file in the office of the Community Development Director. 4. Upon approval of the Plans by the City Council, the staff, the EDA's advisors and legal counsel are authorized and directed to proceed with the implementation of the Plans and for this purpose to negotiate, draft, prepare and present to this Board for its consideration all further plans, resolutions, documents and contracts necessary for this purpose. Approval of the Plans does not constitute approval of any project or a Development Agreement with any developer. 5. Upon approval of the Plans by the City Council, the Community Development Director is authorized and directed to forward a copy of the Plans to the Minnesota Department of Revenue pursuant to Minnesota Statutes 469.175, Subd. 4a. 6. The Community Development Director is authorized and directed to forward a copy of the Plans to the Anoka County Auditor and request that the Auditor certify the original tax capacity of the District as described in the TIF Plan, all in accordance with Minnesota Statutes 469.177. Approved by the Board of Commissioners of the Columbia Heights Economic Development Authority this 16t~ day of September, 2003. Columbia Heights Economic Development Authority Don Murzyn Jr., President Walter R. Fehst, Executive Director PROPOSED TERMS OF CONTRACT FOR PRIVATE REDEVELOPMENT BETWEEN COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY AND NEW HEIGHTS DEVELOPMENT, LLC September 4, 2003 Property Acquisition and platting The "Redevelopment Property" consists of the current Kmart property and the Arby's property. The Redeveloper has entered into a purchase agreement to acquire both of those parcels, and must acquire them directly from the current owner. The Redeveloper must plat the Redevelopment Property to create two areas: one devoted to the "Housing Improvements" described below, and one devoted to certain "Commercial Improvements" along Central Avenue. The "Future Commercial Property" consists of the remaining property on Central Avenue north of Arby's: Subway/TCBY; E1 Bustan; Welle Auto; Buffalo Wild Wings; and Savers/Hollywood Video. The Redeveloper must use its best efforts to acquire the Future Commercial Property during a one-year negotiation period. During that time, the EDA and Redeveloper will negotiate regarding the Authority's role in the future redevelopment of that property. Redeveloper will be responsible for, and indemnifies Authority against, any relocation benefits in connection with the Redevelopment Property and the Future Commercial Property, and against any claims related to environmental conditions on any of that property. TIF Assistance for Housing Authority will issue a tax increment revenue note (Housing TIF Note) to Redeveloper in aggregate principal amount of $700,000 as reimbursement for the costs of demolishing the Kmart building and certain site-cleating costs for the Kmart property. The Housing Note will bear interest at of 6.0 % and will mature February 1,2011 (which is five years of full tax increment). The Housing Note will be delivered, and interest begin to accrue, when Redeveloper has certified to the Authority that it has incurred eligible costs. The Housing Note will be payable solely from 90% of the tax increment generated from the housing development. Defaults under the Contract (including failure to complete construction of the Housing Improvements or the Commercial Improvements described below) allow the Authority to withhold payments or terminate the Housing Note. SJB-235915vl CL205-20 After all housing units are sold, the Redeveloper will calculate its Gross Profit, and a one-half of the "Excess Profit" (the amount over 15%) will be treated as a prepayment on the Housing Note. 3. TIF Assistance for Commercial Improvements The Authority will negotiate with Redeveloper regarding tax increment assistance for the Commercial Improvements to be built within the replat of the Redevelopment Property. If the parties agree on TIF Assistance for the Commercial Improvements, the Authority will issue a second tax increment revenue note (the "Commercial TIF Note"), on terms similar to the Housing TIF Note. If the parties don't agree on TIF assistance, the Redeveloper is still required to complete at least the minimum "Commercial Improvements" as described in Section 7 below. 4. TIF Assistance for Future Commercial Improvements Redeveloper will have exclusive rights regarding the Future Commercial Property for one year. During that time, Redeveloper will try to acquire that property, and the parties will negotiate regarding the nature of require future improvements and tax increment assistance for that redevelopment. If the parties don't enter into a new or amended agreement regarding the Future Commercial Property by the end of the one-year period, Redeveloper's rights under this part of the Agreement lapse, and the Authority may then negotiate with other developers regarding the Future Commercial Property. 5. Business Subsidy · Tax increment assistance for the Housing Improvements is exempt from the Business Subsidy Act because the assistance is for housing. Any assistance for future commercial redevelopment might be subject to the Business Subsidy Act, depending on the facts at the time. If so, the Authority will hold the required public heatings and enter the required business subsidy agreements at the time decisions are made on the future assistance (whether the near-term Commercial Improvements or the longer-term Future Commercial Improvements). 6. Minimum Improvements and Public Improvements · Redeveloper must build 244 units of market rate owner occupied housing, referred to as the Housing Improvements. All units must be complete by December 31, 2007. SJB-176514vl 2 SA285-51 Redeveloper must build at least 10,000 square feet of commercial space, referred to as the Commercial Improvements. All such improvements must be complete by July 1, 2006. Redeveloper must construct all streets, sewer, water, etc to serve the Housing Improvements and the Commercial Improvements, including installation of oversized sewer main needed to provide capacity for this new development. Details regarding public improvements (schedule, security, etc) will be addressed in a separate planning/PUD agreement to be negotiated as the replat and PUD proceed. 7. Restrictions on Transfer Before completion of construction of the Housing Improvements and the Commercial Improvements, Redeveloper may not transfer the property and be released from its obligations under the Agreement without prior Authority approval. The Authority may require that any transferee have the ability to complete the development in accordance with the Agreement. After completion of all housing units and all Commercial Improvements, there is no restriction on transfer. SJB-176514vl 3 SA285-51 As of August 22. 2003 Draft for Fiscal ImPlications MODIFICATION TO THE DOWNTOWN CENTRAL BUSINESS DISTRICT REVITALIZATION PLAN FOR THE CENTRAL BUSINESS DISTRICT REDEVELOPMENT PROJECT and the TAX INCREMENT FINANCING PLAN for the establishment of THE K-MART/CENTRAL AVENUE TAX INCREMENT FINANCING DISTRICT (a renewal and renovation district) within THE CENTRAL BUSINESS DISTRICT REDEVELOPMENT PROJECT COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY CITY OF COLUMBIA HEIGHTS COUNTY OF ANOKA STATE OF IvIINNESOTA Public Hearing: September 22, 2003 Adopted: This document is in draft form for distribution to the County and the School District. The TIF Plan contains the estimated ftscal and economic implications of the proposed TIFDistrict. The Ci~. and the EDA may make minor changes to this draft document prior to the public hearing. Prepared by: EHLERS & ASSOCIATES, INC. 3060 Centre Pointe Drive, Roseville, Minnesota 55113-1105 651-697-8500 fax: 651-697-8555 www.ehlers-inc.com TABLE OF CONTENTS (for reference purposes only) SECTION I MODIFICATION TO THE DO WNTO WN CENTRAL BUSINESS DISTRICT REVITA LIZA TiON PLAN FOR THE CENTRAL BUSINESS DISTRICT REDEVELOPMENT PROJECT... 1-1 Foreword ............................................................. 1-1 Overview ............................................................. 1-1 SECTION II TAX INCREMENT FINANCING PLAN FOR THE K-MART/CENTRAL A VENUE TAX INCREMENT FINANCING DISTRICT .......... 2-1 Subsection 2-1. Foreword .............................................. 2-1 Subsection 2-2. Statutory Authority ....................................... 2-1 Subsection 2-3. Statement of Objectives ................................... 2-1 Subsection 2-4. Downtown CBD Revitalization Plan Overview .................. 2-1 Subsection 2-5. Description of Property in the District and Property To Be Acquired 2-2 Subsection 2-6. Classification of the District ................................ 2-2 Subsection 2-7. Duration of the District .................................... 2-3 Subsection 2-8. Original Tax Capacity, Tax Rate and Estimated Captured Net Tax Capacity Value/Increment and Notification of Prior Planned Improvements ............... 2-3 Subsection 2-9. Sources of Revenue/Bonded Indebtedness .................... 2-4 Subsection 2-10. Subsection 2-11. Subsection 2-12. Subsection 2-13. Subsection 2-14. Subsection 2-15. Subsection 2-16. Subsection 2-17. Subsection 2-18. Subsection 2-19. Subsection 2-20. Subsection 2-21. Subsection 2-22. Subsection 2-23. Subsection 2-24. Subsection 2-25. Subsection 2-26. Subsection 2-27. Subsection 2-28. Subsection 2-29. Uses of Funds .......................................... 2-5 State Tax Increment Financing Aid (Local Contribution) .......... 2-6 Fiscal Disparities Election ................................. 2-6 Business Subsidies ...................................... 2-6 County Road Costs ...................................... 2-7 Estimated Impact on Other Taxing Jurisdictions ................ 2-8 Supporting Documentation ................................. 2-8 Definition of Tax Increment Revenues ........................ 2-9 Modifications to the District ................................ 2-9 Administrative Expenses .................................. 2-9 Limitation of Increment ................................... 2-10 Use of Tax Increment .................................... 2-11 Excess Tax Increments .................................. 2-12 Requirements for Agreements with the Developer .............. 2-12 Assessment Agreements ................................. 2-12 Administration of the District ............................... 2-13 Annual Disclosure Requirements ........................... 2-13 Reasonable Expectations ................................ 2-13 Other Limitations. on the Use of Tax Increment ................ 2-13 Summary ............................................. 2-14 APPENDIX A PROJECT DESCRIPTION ............................................... A-1 APPENDIX B MAP OF THE CENTRAL BUSINESS DISTRICT REDEVELOPMENT PROJECT AND THE K-MART/CENTRAL AVENUE TAX INCREMENT FINANCING DISTRICT . . . B-1 APPENDIX C DESCRIPTION OF PROPERTY TO BE INCLUDED IN THE DISTRICT ............. C-1 APPENDIX D ESTIMATED CASH FLOW FOR THE DISTRICT .............................. D-1 APPENDIX E MINNESOTA BUSINESS ASSISTANCE FORM ............................... E-1 APPENDIX F REDEVELOPMENT QUALIFICATIONS FOR THE DISTRICT .................... F-1 APPENDIX G BUT/FOR QUALIFICATIONS ............................................. G-1 SECTION I MODIFICATION TO THE DOWNTOWN CENTRAL BUSINESS DISTRICT REVITALIZA T/ON PLAN FOR THE CENTRAL BUSINESS D/STRICT REDEVELOPMENT PROJECT Foreword The following text represents a Modification to the Downtown Central Business District (CBD) Revitalization Plan for the CBD Redevelopment Project. This modification represents a continuation of the goals and objectives set forth in the Downtown CBD Revitalization Plan for the CBD Redevelopment Project. Generally, the substantive changes include the establishment of K-Mart/Central Avenue TIF District. For further information, a review of the Downtown CBD Revitalization Plan for the CBD Redevelopment Project is recommended. It is available from the Community Development Director at the City of Columbia Heights. Other relevant information is contained in the Tax Increment Financing Plans for the Tax Increment Financing Districts located within the CBD Redevelopment Project. Overview The Central Business District ("CDB") Redevelopment Project is administered by the Columbia Heights Economic Development Authority (the "EDA"). Previously, the CBD Redevelopment Project was established and administered by the City of Columbia Heights (the "City") and the Columbia Heights Housing and Redevelopment Authority (the "HRA"). The CBD Redevelopment Project previously included property in the downtown area. On July 18, 1994, the Sheffield Neighborhood Redevelopment and Housing Development Project was consolidated with the CBD Redevelopment Project by the HRA. On January 8, 1996, the I-IRA transferred its authority to the EDA, which currently administers the CDB Redevelopment Project. On May 27, 1997, the CBD Redevelopment Project was modified to expand the project area to include the entire City. Concurrently, Housing Redevelopment Tax Increment Financing District No. 1 ("District No. 1") within the CBD Redevelopment Project was established. As District No. 1 is a scattered site redevelopment tax increment financing district, the property to be included in District No. I is found throughout the City, thus necessitating the expansion of the boundaries of the CBD Redevelopment Project. The City and the EDA have hereby modified the boundaries of the CBD Redevelopment Project to be coterminous with the corporate limits of the City. A map of the boundaries of the CBD Redevelopment Project can be found in Appendix A. Columbia Heights EDA Modification to the Downtown CBD Revitalization Plan for the CBD Redevelopment Project 1-1 SECTION II TAX INCREMENT FINANCING PLAN FOR THE K-MART/CENTRAL A VENUE TAX INCREMENT FINANCING DISTRICT Subsection 2-1. Foreword The Columbia Heights Economic Development Authority (the "EDA"), the City of Columbia Heights (the "City"), staffand consultants have prepared the following information to expedite the establishment of the K-Mart/Central Avenue Tax Increment Financing District ("the District"), a renewal and renovation tax increment financing district, located in the Central Business District (CBD) Redevelopment Project. Subsection 2-2. Statutory Authority Within the City, there exist areas where public involvement is necessary to cause development or redevelopment to occur. To this end, the EDA and City have certain statutory powers pursuant to Minnesota Statutes ("M.S. "), Sections 469. 090 to 469.1082, and Sections 469.124 to 469.134, inclusive, as amended, and M.S., Sections 469.174 to 469.1799, inclusive, as amended (the "Tax Increment Financing Act" or "TIF Act"), to assist in financing public costs related to this project. This section contains the Tax Increment Financing Plan (the "TIF Plan") for the K-Mart/Central Avenue Tax Increment Financing District. Other relevant information is contained in the Modification to the Downtown CBD Revitalization Plan for the CBD Redevelopment Project. Subsection 2-3. Statement of Objectives The District currently consists of six parcels of land and adjacent and internal rights-of-way. The District is being created to facilitate the construction of 244 owner-occupied units and up to 115,000 s.fi of commercial redevelopment along Central Avenue in the City of Columbia Heights. Contracts for this have not been entered into at the time of preparation of this TIF Plan, but development is likely to occur in the fall of 2003. This TIF Plan is expected to achieve many of the objectives outlined in the Downtown CBD Revitalization Plan for the CBD Redevelopment Project. The activities contemplated in the Modification to the Downtown CBD Revitalization Plan and the TIP Plan do not preclude the undertaking of other qualified development or redevelopment activities. These activities are anticipated to occur over the life of the CBD Redevelopment Project and the District. Subsection 2-4. Downtown CBD Revitalization Plan Overview 1. Property to be Acquired - Selected property located within the District may be acquired by the EDA or City and is further described in this TIF Plan. 2. Relocation - Relocation services, to the extent required by law, are available pursuant to M.'S., Chapter 117 and other relevant state and federal laws. Upon approval of a developer's plan relating to the project and completion of the necessary legal requirements, the EDA or City may sell to a developer selected properties that it may acquire within the District or may lease land or facilities to a developer. 4. The EDA or City may perform or provide for some or all necessary acquisition, Columbia Heights EDA Tax Increment Financing Plan for the K-Mart/Central Avenue Tax Increment Financing District 2-1 construction, relocation, demolition, and required utilities and public streets work within the District. Subsection 2-5. Description of Property in the District and Property To Be Acquired The District encompasses all property and adjacent rights-of-way identified by the parcels listed below. See the map in Appendix B for further information on the location of the District. Parcel Numbers 25-30-24-32-000 l 25-30-24-32-0002 25-30-24-32-0003 25-30-24-32-0004 25-30-24-32-0061 25-30-24-32-0062 The EDA or City may acquire any parcel within the District including interior and adjacent street rights of way. Any properties identified for acquisition will be acquired by the EDA or City only in order to accomplish one or more of the following: storm sewer improvements; provide land for needed public streets, utilities and facilities; carry out land acquisition, site improvements, clearance and/or development to accomplish the uses and objectives set forth in this plan. The EDA or City may acquire property by gift, dedication, condemnation or direct purchase from willing sellers in order to achieve the objectives of this TIF Plan. Such acquisitions will be undertaken only when there is assurance of funding to finance the acquisition and related costs. Subsection 2-6. Classification of the District The EDA and City, in determining the need to create a tax increment financing district in accordance with M.S., Sections 469.174 to 469.1799, as amended, inclusive, find that the District, to be established, is a renewal and renovation district pursuant to M.S., Section 469.174, Subd lOa. as defined belo~v and on the next page: (a) "Renewal and renovation district" means a type of tc~r increment financing district consisting of a project, or portions of a project, within which the City finds by resolution that: (1) (i) parcels consisting of 70percent of the area of the district are occupied by buildings, streets, utilities, paved or gravel parking lots, or other similar structures; (ii) 20 percent of the buildings are structurally substandard; and (iii) 30percent of the other buildings require substantial renovation or clearance to remove existing conditions such as: inadequate street layout, incompatibld uses or land use relatio, nships, overcrowding of buildings on the land, excessive dwelling unit density, obsolete buildings not suitable for improvement or conversion, or other identified hazards to the health, safety, and general well-being of the community; and (2) the c~nditi~ns described in clause (~) are reas~nab~e distributed thr~ugh~ut the ge~graphic area of the district. Columbia Heights EDA Tax Increment Financing Plan for the K-Marl/Central Avenue Tax Increment Financing District 2-2 For purposes of determining whether a building is stmtcturally substandard, whether parcels are occupied by buiMings, streets, utilities, paved or gravel parking lots, or other similar structures, or whether noncontiguous areas qualify, the provisions of subdivision 10, garagraphs (c), (e), and 09 apply. In meeting the statutory criteria the City rely on the following facts and findings: [] The District is a renewal and renovation district consisting of six parcels. [] An inventory shows that parcels consisting of more than 70 percent of the area in the District are occupied by buildings, streets, utilities, paved or gravel parking lots, or other similar structures. [] An inspection of the buildings located within the District finds that more than 20 percent of the buildings are structurally substandard as defined in the TIF Act. (See Appendix F). An inspection of the buildings located within the District finds that more than 30 percent of the buildings require substantial renovation or clearance to remove existing conditions such as defined in the TIF Act. (See Appendix F). Pursuant to M.S. 469.176 Subd. 7, the District does not contain any parcel or part of a parcel that qualified under the provisions of M.S 273.111 or 273.112 or Chapter 473H for taxes payable in any of the five calendar years before the filing of the request for certification of the District. Subsection 2-7. Duration of the District Pursuant to M.S., Section 469.175, Subd. I, and Section 469.176, Subd 1, the duration of the District must be indicated within the TIF Plan. Pursuant to M.S., Section 469. J76, Subd lb, the duration of the District will be 15 years after receipt of the first increment by the EDA or City (a total of 16 years of tax increment). The date of receipt by the City of the first tax increment is expected to be 2006. Thus, it is estimated that the District, including any modifications of the TIF Plan for subsequent phases or other changes, would terminate after 2021, or when the TIF Plan is satisfied. The EDA or City reserves the right to decertify the District prior to the legally required date. Subsection 2-8. Original Tax Capacity, Tax Rate and Estimated Captured NetTax Capacity Value/Increment and Notification of Prior Planned Improvements Pursuant to M.S., Section 469.174, Subd. 7 and M. S., Section 469.177, Subd. 1, the Original Net Tax CapaciW (ONTC) as certified for the District will be based on the market values placed on the property by the assessor in 2003 for taxes payable 2004. Pursuant to M.S., Section 469.177, Sub&. 1 and 2, the County Auditor shall certify in each year (beginning in the payment year 2005) the amount by which the original value has increased or decreased as a result off 1. Change in tax exempt status of property; 2. Reduction or enlargement of the geographic boundaries of the district; 3. Change due to adjustments, negotiated or court-ordered abatements; 4. Change in the use of the property and classification; 5. Change in state law governing class rates; or 6. Change in previously issued building permits. In any year in which the current Net Tax Capacity (NTC) value of the District declines below the ONTC, no value will be captured and no tax increment will be payable to the EDA or City. Columbia Heights EDA Tax Increment Financing Plan for the K-MarffCentral Avenue Tax Increment Financing District 2-3 The original local tax rate for the District will be the local tax rate for taxes payable 2004, assuming the request for certification is made before June 30, 2004. The ONTC and the Original Local Tax Rate for the District appear in the table below. Pursuant to M.S., Section 469.174 Subd. 4 and M.S., Section 469.177, Subd. 1, 2, and 4, the estimated Captured Net Tax Capacity (CTC) of the District, within the CBD Redevelopment Project, upon completion of the project, will annually approximate tax increment revenues as shown in the table below. The EDA and City request 100 percent of the available increase in tax capacity for repayment of its obligations and current expenditures, beginning in the tax year payable 2005. The Project Tax Capacity (PTC) listed is an estimate of values when the project is completed. Project Estimated Tax Capacity upon Completion (PTC) $820,250 Original Estimated Net Tax Capacity (ONTC) $91,182 Fiscal Disparities Reduction $72,600 Estimated Captured Tax Capacity (CTC) $656,468 Original Local Tax Rate 1.08395 Pay 2003 Estimated Annual Tax Increment(CTC x Local Tax Rate) $711,578 Percent Retained by the City 100% Pursuant to M.S., Section 469.177, Subd. 4, the EDA shall, after a due and diligent search, accompany its request for certification to the County Auditor or its notice of the District enlargement pursuant to 2~S., Section 469.175, Subd 4, xvith a listing of all properties within the District or area of enlargement for which building permits have been issued during the eighteen (18) months immediately preceding approval of the TIF Plan by the municipaliW pursuant to 3~.S., Section 469.175, Sztbd. 3. The County Auditor shall increase the original net tax capaciW of the District by the net tax capaci~ of improvements for which a building permit xvas issued. The City is reviewing the area to be included in the District to determine if any building permits have been issued during the 18 months immediately preceding approval of the TIF Plan by the City. Subsection 2-9. Sources of Revenue/Bonded Indebtedness Public improvement costs, acquisition, relocation, utilities, parking facilities, streets and sidewalks, and site preparation costs and other costs outlined in the Uses of Funds will be financed primarily throu~ the annual collection of tax increments. The EDA or City reserves the right to use other sources of revenue legally ap- plicable to the EDA or City and the TIF Plan, including, but not limited to, special assessments, general property taxes, state aid for road maintenance and construction, proceeds from the sale of land, other contributions from the developer and investment income, to pay for the estimated public costs. The EDA or City reserves the right to incur bonded indebtedness or other indebtedness as a result of the TIF Plan. As presently proposed, the project will be financed by a pay-as-you-go note with a developer. Additional indebtedness may be required to finance other authorized activities. The total principal amount of bonded indebtedness, including a general obligation (GO) TIF bond, or other indebtedness related to the use of tax increment financing will not exceed $10,000,000 without a modification to the TIF Plan pursuant to applicable statutory requirements. Columbia Heights EDA Tax Increment Financing Plan for the K-MarVCentral Avenue Tax Increment Financing District 2-4 This provision does not obligate the EDA or City to incur debt. The EDA or City will issue bonds or incur other debt only upon the determination that such action is in the best interest of the City. The EDA or City may also finance the activities to be undertaken pursuant to the TIF Plan through loans from funds of the EDA or City or to reimburse the developer on a "pay-as-you-go" basis for eligible costs paid for by a developer. The estimated sources of funds for the District are contained in the table below. SOURCES OF FUNDS TOTAL Tax Increment $10,195,800 PROJECT REVENUES $107195.800 Subsection 2-;10. Uses of Funds Currently under consideration for the District is a proposal to facilitate the construction of 244 owner- occupied units and up to 115,000 s.f. of commercial redevelopment along Central Avenue. The EDA and City have determined that it will be necessary to provide assistance to the project for certain costs. The EDA has studied the feasibility of the development or redevelopment of property in and around the District. To facilitate the establishment and development or redevelopment of the District, this TIF Plan authorizes the use of tax increment financing to pay for the cost of certain eligible expenses. The estimate of public costs and uses of funds associated with the District is outlined in the following table. USES OF FUNDS Land/Building Acquisition Site Improvements/Preparation Public Utilities Parking Facilities Streets and Sidewalks Interest Administrative Costs (up to 10%) PROJECT COSTS TOTAL TOTAL $3,500,000 $5O0,O0O $500,000 $2,000,000 $100,000 $2,576,220 $1,019,580 $10,195,800 The above budget is organized according to the Office of State Auditor (OSA) reporting forms. Estimated costs associated with the District are subject to change among categories without a modification to this TIF Plan. The cost of all activities to be considered for tax increment financing will not exceed, without formal modification, the budget above pursuant to the applicabIe statutory requirements. Pursuant to M.S., Section 469.1763, Subd. 2, no more than 20 percent of the tax increment paid by property within the District will be spent on activities related to development or redevelopment outside of the District but within the boundaries of the Central Business District Redevelopment Project, (including administrative costs, which are considered to be spent outside of the District) subject to the limitations as described in this TIF Plan. Columbia Heights EDA Tax Increment Financing Plan for the K-Marl]Central Avenue Tax Increment Financing District 2-5 Subsection 2-11. State Tax Increment Financing Aid (Local Contribution) M.S., Section 2 73.1399 (LGAfHACA penalty) was repealed by the 2001 Legislature and does not apply to the District. Subsection 2-12. Fiscal Disparities Election Pursuant to M.S., Section 469.177, Subd 3, the EDA or City may elect one of two methods to calculate fiscal disparities. If the calculations pursuant to M.S., Section 469.177, Subd. 3, clause b, (within the District) are followed, the follo~ving method of computation shall apply: The original net tax capacity shall be determined before the application of the fiscal disparity provisions of Chapter 276A or 473F. The current net tax capacity shall exclude any fiscal disparity commercial-industrial net tar capacity increase between the original year and the current year multiplied by the fiscal disparity ratio determined pursuant to M.S., Section 276A.06, subdivision 7 or M.S., Section 473F. 08, subdivision 6. Where the original net tax capacity is equal to or greater than the current net tax capacity, there is no captured tc~r capacity and no tax increment determination. Where the original tax capacity is less than the current tax capacity, the difference between the original net tax capacity and the current net tax capacity is the captured net tax capacity. This amount less any portion thereof which the authority has designated, in its tax increment financing plan, to share with the local taxing districts is the retained captured net tax capacity of the authority. The county auditor shall exclude the retained captured net ta, c capacity of the authority from the net tar capacity of the local taring districts in determining local taxing district tax rates. The local tax rates so determined are to be extended against the retained captured net tax capacity of the authority as well as the net tax capacity of the local taxing districts. The tar generated by the extension of the less of(A) the local taxing district tax rates or (B) the original local tax rate to the retained captured net tax capacity of the authority is the tax increment of the attthority. The EDA or City shall submit to the County. Auditor at the time of the request for certification which method of computation of fiscal disparities the City elected. The EDA will choose to calculate fiscal disparities by clause b. According to M.S., Section 469.177, Subd. 3: The method of co~nputation of tax increment applied to a district pursuant to paragraph (a) or (b) shall remain the same for the duration of the district, except that the governing body may elect to change its election from the method of computation in paragraph (a) to the method in paragraph (b). Subsection 2-13. Business Subsidies Pursuant to M..S. Sections 116J. 993, Subd. 3, the following forms of financial assistance are not considered a business subsidy: (1) A business subsidy of less than $25,000; Columbia Heights EDA Tax Increment Financing Plan for the K-MarffCentral Avenue Tax Increment Financing District 2-6 (9) (10) (11) (12) (13) (14) (2) Assistance that is generally available to all businesses or to a general class of similar businesses, such as a line of business, size, location, or similar general criteria; (3) Public improvements to buildings or lands owned by the state or local government that serve a public purpose and do not principally benefit a single business or defined group of businesses at the time the improvements are made; (4) Redevelopment property polluted by contaminants as defined in M.S. Section I16J. 552, Subd. 3; (5) Assistance provided for the sole purpose of renovating old or decaying building stock or bringing it up to code and assistance provided for designated historic preservation districts, provided that the assistance is equal to or less than 50% of the total cost; (6) Assistance to provide job readiness and training services if the sole purpose of the assistance is to provide those services; (7) Assistance for housing; (8) Assistance for pollution control or abatement, including assistance for a tax increment financing hazardous substance subdistrict as defined under M.S. Section 469.174, Subd. 23; Assistance for energT conservation; Tax reductions resulting from conformity with federal tax law; Workers' compensation and unemployment compensation; Benefits derived from regulation; Indirect benefits derived from assistance to educational institutions; Funds from bonds allocated under chapter 474A, bonds issued to refund outstanding bonds, and bonds issued for the benefit of an organization described in section 501 (c) (3) of the Internal Revenue Code of 1986, as amended through December 31, 1999; (15) Assistance for a collaboration between a Minnesota higher education institution and a business; (16) Assistance for a tax increment financing soils condition district as defined under M.S. Section 469.174, Subd. 19; (17) Redevelopment when the recipient's investment in the purchase of the site and in site preparation is 70 percent or more of the assessor's current year's estimated market value; (18) General changes in tax increment financing law and other general tax law changes of a principally technical nature. (19) Federal assistance until the assistance has been repaid to, and reinvested by, the state or local government agency; (20) Funds from dock and wharf bonds issued by a seaway port authority; (21) Business loans and loan guarantees of $75,000 or less; and (22) Federal loan funds provided through the United States Department of Commerce, Economic Development Administration. The City will comply with M.S., Section 116d. 993 to 116J. 994 to the extent the tax increment assistance under this TIF Plan does not fall under any of the above exemptions. Subsection 2-14. County Road Costs Pursuant to MS., Section 469.175, Subd. Ia, the county board may require the City to pay for all or part of the cost of county road improvements if the proposed development to be assisted by tax increment will, in the judgement of the county, substantially increase the use of county roads requiring construction of road improvements or other road costs and if the road improvements are not scheduled within the next five years under a capital improvement plan or within five years under another county plan. If the county elects to use increments to improve county roads, it must notify the City within forty-five days of receipt of this TIF Plan. In the opinion of the City and consultants, the proposed development outlined Columbia Heights EDA Tax Increment Financing Plan for the K-Man/Central Avenue Tax Increment Financing District 2-7 in this TIF Plan will have little or no impact upon county roads, therefore the TIF Plan was not forwarded to the county 45 days prior to the public hearing. The City is aware that the county could claim that tax increment should be used for county roads, even after the public hearing. Subsection 2-15. Estimated Impact on Other Taxing Jurisdictions The estimated impact on other taxing jurisdictions assumes that the redevelopment contemplated by the TIF Plan would occur without the creation of the District. However, the City has determined that such development or redevelopment would not occur "but for" tax increment financing and that, therefore, the fiscal impact on other taxing jurisdictions is $0. The estimated fiscal impact of the District would be as follows if the "but for" test was not met: IMPACT ON TAX BASE Anoka County City of Columbia Heights Columbia Heights ISD No. 13 2002/2003 Estimated Captured Total Net Tax Capacity (CTC) Percent of CTC Tax Capacity_. Upon Completion to Entity Total 176,930,024 656,468 0.3710% 8,351,648 656,468 7.8603% 13,591,199 656,468 4.8301%° IMPACT ON TAX RATES 2002/2003 Percent Potential Extension Rates of Total CTC Taxes Anoka County 0.346170 31.94% 656,468 227,250 City of Columbia Heights 0.452720 41.77% 656,468 297,196 Columbia Heights ISD No. 13 0.137850 12.72% 656,468 90,494 Other 0.147210 13.58% 656,468 96,639 Total 1.083950 100.00% 711,578 The estimates listed above display the captured tax capacity when all construction is completed. The tax rate used for calculations is the actual 2002/Pay 2003 rate. The total net capacity for the entities listed above are based on actual Pay 2003 figures. The District will be certified under the actual 2003/Pay 2004 rates, which were unavaiIable at the time this TIF Plan was prepared. Subsection 2-16. Supporting Documentation Pursuant to MS. Section 469.175 Subd la, clause 7 the TIF Plan must contain identification and description of studies and analyses used to make the determination set forth in M.S. Section 469.175 Subd 3, clause (2) and the findings are required in the resolution approving the TIF district.. Following is a list of reports and studies on file at the City that support the Authority's findings: I. Technical Memorandum for K-Mart Redevelopment Process - DSU 2. SEHRedevelopment Findings Columbia Heights EDA Tax Increment Financing Plan for the K-MarV'Central Avenue Tax Increment Financing District 2-8 Subsection 2-17. Definition of Tax Increment Revenues Pursuant to M.S., Section 469.174, Subd. 25, tax increment revenues derived from a tax increment financing district include all of the following potential revenue sources: 1. Taxes paid by the captured net tax capacity, but excluding any excess taxes, as computed underM. S., Section 469.177; 2. The proceeds from the sale or lease of property, tangible or intangible, purchased by the Authority with tax increments; 3. Repayments of loans or other advances made by the Authority with tax increments; and 4. Interest or other investment earnings on or from tax increments. Subsection 2-18. Modifications to the District In accordance with M.S., Section 469.175, Subd. 4, any: 1. Reduction or enlargement of the geographic area of the CBD Redevelopment Project or the District; 2. Increase in amount of bonded indebtedness to be incurred, including a determination to capitalize interest on debt if that determination ~vas not a part of the original plan, or to increase or decrease the amount of interest on the debt to be capitalized; 3. Increase in the portion of the captured net tax capacity to be retained by the City; 4. Increase in total estimated tax increment expenditures; or 5. Designation of additional property to be acquired by the City, shall be approved upon the notice and after the discussion, public hearing and findings required for approval of the original TIF Plan. Pursuant to MS. Section 469.175 Subd 4(b), the geographic area of the District may be reduced, but shall not be enlarged after five years following the date of certification of the original net tax capacity by the county auditor. Ifa redevelopment district is enlarged, the reasons and supporting facts for the determination that the addition to the district meets the criteria ofM. S., Section 469.174, Subd. 10, paragraph (a), clauses (1) to (5), must be documented in writing and retained. The requirements of this paragraph do not apply if (1) the only modification is elimination of parcel(s) from the CBD Redevelopment Project orthe District and (2) (A) the current net tax capacity of the parcel(s) eliminated from the District equals or exceeds the net tax capacity of those parcel(s) in the District's original net tax capacity or (B) the City agrees that, notwithstanding M.S., Section 469.177, Subd. 1, the original net tax capacity will be reduced by no more than the current net tax capacity of the parcel(s) eliminated from the District. The City must notify the County Auditor of any modification that reduces or enlarges the geographic area of the CBD Redevelopment Project or the District. Modifications to the District in the form of'a budget modification or an expansion of the boundaries will be recorded in the TIF Plan. Subsection 2-19. Administrative Expenses In accordance with M.S., Section 469.174, &tbd. 14, and M.S., Section 469.176, Subd 3, administrative expenses means all expenditures of the City, other than: 1. Amounts paid for the purchase of land; 2. Amounts paid to contractors or others providing materials and services, including architectural and Columbia Heights EDA Tax Increment Financing Plan for the K-Matt/Central Avenue Tax Increment Financing District 2-9 engineering services, directly connected with the physical development of the real property in the project; 3. Relocation benefits paid to or services provided for persons residing or businesses located in the project; or 4. Amounts used to pay principal or interest on, fund a reserve for, or sell at a discount bonds issued pursuant to M.S., Section 469.178; or 5. Amounts used to pay other financial obligations to the extent those obligations were used to finance costs described in sections 1 to 3. For districts for which the request for certification were made before August 1, 1979, or after June 30, 1982, administrative expenses also include amounts paid for services provided by bond counsel, fiscal consultants, and planning or economic development consultants. Tax increment may be used to pay any authorized and documented administrative expenses for the District up to but not to exceed 10 percent of the total tax increment expenditures authorized by the TIF Plan or the total tax increment expenditures for the CBD Redevelopment Project, whichever is less. Pursuant to M.S., Section 469.176, Subd. 4h, tax increments may be used to pay for the County's actual administrative expenses incurred in connection with the District. The county may require payment of those expenses by February 15 of the year following the year the expenses were incurred. Pursuant to M.S., Section 469. 177, Subd. 11, the County Treasurer shall deduct an amount (currently .36 percen0 of any increment distributed to the City and the Coun .ty Treasurer shall pay the amount deducted to the State Treasurer for deposit in the state general fund to be appropriated to the State Auditor for the cost of financial reporting of tax increment financing information and the cost of examining and auditing authorities' use of tax increment financing. This amount may be adjusted annually by the Commissioner of Revenue. Subsection 2-20. Limitation of Increment Pursuant to M.S., Section 469.176, Subd. Ia, no tax increment shall be paid to the City for the District after three (3) years from the date of certification of the Original Net Tax Capacity value of the taxable property in the District by the County Auditor unless within the three (3) year period: (1) Bonds have been issued in aid of the project containing the District pursuant to M.S., Section 469.178, or any other law, except revenue bonds issued pursuant to M.S., Sections 469.152 to 469.165, or (2) The City has acquired property within the District, or (3) The City has constructed or caused to be constructed public improvements within the District. The bonds must be issued, or the City must acquire property or construct or cause public improvements to be constructed by approximately September, 2006 and report such actions to the County Auditor. The tax increment pledged to the payment of bonds and interest thereon may be discharged and the District may be terminated if sufficient funds have been irrevocably deposited in the debt service fund or other escrow account held in trust for all outstanding bonds to provide for the payment of the bonds at maturity or redemption date. Columbia Heights EDA Tax Increment Financing Plan for the K-Mart/Central Avenue Tax Increment Financing District 2-10 Pursuant to M.S., Section 469.176, Subd. 6: if, after four years from the date of certification of the original net tax capacity of the tax increment .financing district pursuant to M.S., Section 469. ! 77, no demolition, rehabilitation or renovation of property or other site preparation, including qualified improvement of a street adjacent to a parcel but not installation of utility service including sewer or water systems, has been commenced on a parcel located within a tax increment financing district by the authority or by the owner of the parcel in accordance with the tax increment financing plan, no additional tax increment may be taken from that parcel and the original net tax capacity of that parcel shall be excluded from the original net tax capacity of the tax increment financing district. If the authority or the owner of the parcel subsequently commences demolition, rehabilitation or renovation or other site preparation on that parcel including qualified improvement of a street adjacent to that parcel, in accordance with the tax increment .financing plan, the authority shall certify to the county auditor that the activity has commenced and the county auditor shall certify the net tax capacity thereof as most recently certified by the commissioner of revenue and add. it to the original net tar capacity of the tax increment financing district. The county auditor must enforce the provisions of this subdivision. The authority must submit to the county auditor evidence that the required activity has taken place for eachparcel in the district. The evidence for aparcel must be submitted by February 1 of the fifih year following the year in which the parcel ,vas certified as included in the district. For purposes of this subdivision, qualified improvements o fa street are limited to (1) construction or opening of a new street, (2) relocation ora street, and (3) substantialreconstruction or rebuilding of an existing street. The City or a property o~vner must improve parcels within the District by approximately September, 2007 and report such actions to the County Auditor. Subsection 2-21. Use of Tax Increment The City hereby determines that it will use 100 percent of the captured net tax capacity of taxable property located in the District for the following purposes: 1. To pay the principal of and interest on bonds issued to finance a project; 2. To finance, or otherwise pay the capital and administration costs of the CBD Redevelopment Project pursuant to the MS., Sections 469.090 to 469.1082 and M. S., Sections 469.124 to 469.134; 3. To pay for project costs as identified in the budget set forth in the TIF Plan; 4. To finance, or otherwise pay for other purposes as provided in M..S., Section 469.176, Subd 4; 5. To pay principal and interest on any loans, advances or other payments made to or on behalf of the City or for the benefit of the CBD Redevelopment Project by a developer; 6. To finance or otherwise pay premiums and other costs for insurance or other security guaranteeing the payment when due of principal of and interest on bonds pursuant to the TIF Plan or pursuant to M.S., Chapter 462C. M.S., Sections 469.152 through 469.165, and/or MS., Sections 469.178; and 7. To accumulate or maintain a reserve securing the payment when due of the principal and interest on the tax increment bonds or bonds issued pursuant to M.S., Chapter 462C, M.S., Sections 469.152 through 469.165, and/or M.S., Sections 469.178. These revenues shall not be used to circumvent any levy limitations applicable to the City nor for other purposes prohibited by M.S., Section 469.176, Subd 4. Tax increments generated in the District will be paid by Anoka County to the City for the Tax Increment Columbia Heights EDA Tax Increment Financing Plan for the K-MaCdCentral Avenue Tax Increment Financing District 2-11 Fund of said District. The City will pay to the developer(s) annually an amount not to exceed an amount as specified in a developer's agreement to reimburse the costs of land acquisition, public improvements, demolition and relocation, site preparation, and administration. Remaining increment funds will be used for City administration (up to I0 percent) and the costs of public improvement activities outside the District. Subsection 2-22. Excess Tax Increments Pursuant to M.S., Section 469.176, Subd. 2, in any year in which the tax increment exceeds the amount necessary to pay the costs authorized by the TIF Plan, including the amount necessary to cancel any tax levy as provided in M.S., Section 475. 61, Subd 3, the City shall use the excess amount to do any of the following: 1. Prepay any outstanding bonds; 2. Discharge the pledge of tax increment therefor; 3. Pay into an escrow account dedicated to the payment of such bonds; or 4. Return the excess to the County, Auditor for redistribution to the respective taxing jurisdictions in proportion to their local tax rates. In addition, the City may, subject to the limitations set forth herein, choose to modify the TIF Plan in order to finance additional public costs in the Central Business District Redevelopment Project or the District. Subsection 2-23. Requirements for Agreements with the Developer The City will review any proposal for private development to determine its conformance with the Downtown CBD Revitalization Plan and with applicable municipal ordinances and codes. To facilitate this effort, the following documents may be requested for review and approval: site plan, construction, mechanical, and electrical system drawings, landscaping plan, grading and storm drainage plan, signage system plan, and any other drawings or narrative deemed necessary by the City to demonstrate the conformance of the development with City plans and ordinances. The City may also use the Agreements to address other issues related to the development. Pursuant to M.S., Section 469.176, Subd. 5, no more than 25 percent, by acreage, of the property to be acquired in the District as set forth in the TIF Plan shall at any time be owned by the City as a result of acquisition with the proceeds of bonds issued pursuant to M.S., Section 469.178 to which tax increments from property acquired is pledged, unless prior to acquisition in excess of 25 percent of the acreage, the Ci,ty concluded an agreement for the development or redevelopment of the property acquired and which provides recourse for the City should the development or redevelopment not be completed.. Subsection 2-24. Assessment Agreements Pursuant to M.S., Section 469.177, Subd. 8, the City may enter into a written assessment agreement in recordable form with the developer of property within the District which establishes a minimum market value of the land and completed improvements for the duration of the District. The assessment agreement shall be presented to the County Assessor who shall review the plans and specifications for the improvements to be constructed, review the market value previously assigned to the land upon which the improvements are to be constructed and, so long as the minimum market value contained in the assessment agreement appears, in the judgment of the assessor, to be a reasonable estimate, the County Assessor shall also certify the minimum market value agreement. Columbia Heights EDA Tax Increment Financing Plan for the K-Marl/Central Avenue 'Fax Increment Financing District 2-12 Subsection 2-25. Administration of the District Administration of the District will be handled by the Executive Director of the EDA. Subsection 2-26. Annual Disclosure Requirements Pursuant to M.S., Section 469.175, Subd 5, 6 and 6a the City must undertake financial reporting for all tax increment financing districts to the Office of the State Auditor, County Board, Count), Auditor and School Board on or before August 1 of each year. M.S., Section 469.175, Subd. 5 also provides that an annual statement shall be published in a newspaper of general circulation in the City on or before August 15. If the City fails to make a disclosure or submit a report containing the information required by M.S. Section 469.175 Subd..5 and Subd. 6, the OSA will direct the County Auditor to withhold the distribution of tax increment from the District. Subsection 2-27. Reasonable Expectations As required by the TIF Act, in establishing the District, the determination has been made that the anticipated development would not reasonably be expected to occur solely throu~ private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the District permitted by the TIF Plan. In making said determination, reliance has been placed upon written representation made by the developer to such effects and upon City staffa~vareness of the feasibility of developing the project site. A comparative analysis of estimated market values both with and without establishment of the District and the use of tax increments has been performed as described above. Such analysis is included ~vith the cashflow in Appendix D, and indicates that the increase in estimated market value of the proposed development (less the indicated subtractions) exceeds the estimated market value of the site absent the establishment of the District and the use of tax increments. Subsection 2-28. Other Limitations on the Use of Tax Increment General Limitations. All revenue derived from tax increment shall be used in accordance with the TIF Plan. The revenues shall be used to finance, or otherwise pay the capital and administration costs of the CBD Redevelopment Project pursuant to the M.S., Sections 469.124 to 469.134. Tax increments may not be used to circumvent existing levy, limit law. No tax increment may be used for the acquisition, construction, renovation, operation, or maintenance of a building to be used primarily and regularly for conducting the business ora municipality, county, school district, or any other local unit of government or the state or federal government. This provision does not prohibit the use of revenues derived from tax increments for the construction or renovation of a parking structure. Pooling Limitations. At least 80 percent of tax increments from the District must be expended on activities in the District or to pay bonds, to the extent that the proceeds of the bonds were used to finance activities within said district or to pay, or secure payment of, debt service on credit enhanced bonds. Not more than 20 percent of said tax increments may be expended, through a development fund or other~vise, on activities outside of the District except to pay, or secure payment of, debt service on credit enhanced bonds. For purposes of applying this restriction, all administrative expenses must be treated as if they were solely for activities outside of the District. Columbia Heights EDA Tax Increment Financing Plan for the K-Marl/Central Avenue Tax Increment Financing District 2-13 Five Year Limitation on Commitment of Tax Increments. Tax increments derived from the District shall be deemed to have satisfied the 80 percent test set forth in paragraph (2) above only if the five year rule set forth in M.S., Section 469.1763, Subd 3, has been satisfied; and beginning with the sixth year following certification of the District, 75 percent of said tax increments that remain after expenditures permitted under said five year rule must be used only to pay previously committed expenditures or credit enhanced bonds as more fully set forth in M.S., Section 469.1763, Subcl. 5. Renewal and Renovation District. At least 90 percent of the revenues derived from tax increment from a redevelopment district must be used to finance the cost of correcting conditions that allo~v designation of redevelopment and renewal and renovation districts under ~S., Section 469.176Subd. 4j. These costs include, but are not limited to, acquiring properties containing structurally substandard buildings or improvements or hazardous substances, pollution, or contaminants, acquiring adjacent parcels necessary to provide a site of sufficient size to permit development, demolition and rehabilitation of structures, clearing of the land, the removal of hazardous substances or remediation necessary for development of the land, and installation of utilities, roads, sidewalks, and parking facilities for the site. The allocated administrative expenses of the City, including the cost of preparation of the development action response plan, may be included in the qualifying costs. Subsection 2-29. Summary The EDA is establishing the District to preserve and enhance the tax base, redevelop substandard areas, and provide employment opportunities in the City. The TIF Plan for the District was prepared by Ehlers & Associates, Inc., 3060 Centre Pointe Drive, Roseville, Minnesota 55113, telephone (651) 697-8500. Columbia Heights EDA Tax Increment Financing Plan for the K-Marv'Central Avenue Tax Increment Financing District 2-14 APPENDIX A PROJECT DESCRIPTION Nedegaard Custom Homes has obtained a purchase agreement on the vacant K-Mart property east of Central Avenue between 47th and 49th. The developer is planning to build 244 owner occupied units on the K-Mart site as Phase 1 and construct additional commercial development along Central Avenue as Phase II. Phase II could include up to 115,000 s.f. of new commercial property, depending upon the amount of land included in the redevelopment. The Phase 1 assistance is limited to a developer financed note for demolition costs of the former K-Mart structure. The majority of the tax increment will be utilized to acquire property and construct public parking to facilitate the commercial redevelopment. A six-month public planning process has preceded the preparation of the tax increment plan as ~vell as findings by SEH on the condition of the buildings to be included on the site. APPENDIX A-~ APPENDIX B MAP OF THE CENTRAL BUSINESS DISTRICT REDEVELOPMENT PROJECT AND THE K-MART/CENTRAL AVENUE TAX INCREMENT FINANCING DISTRICT APPENDIX City of Columbia Heights Kmart Tax Increment Financing District Legend ~ citylimit ~ Kmart Tax Increment Financing District APPENDIX C DESCRIPTION OF PROPERTY TO BE INCLUDED IN THE DISTRICT The District encompasses all property and adjacent rights-of-way identified by the parcels listed below. Parcel Numbers Address Owner 25-30-24-32-0001 4801 Central Avenue NE 25-30-24-32-0002 4811 Central Avenue NE 25-30-24-32-0003 4849 Central Avenue NE 25-30-24-32-0004 4757 Central Avenue NE 25-30-24-32-0061 4707 Central Avenue NE 25-30-24-32-0062 4747 Central Avenue NE APPENDIX c-! APPENDIX D ESTIMATED CASH FLOW FOR THE DISTRICT D-! 8J18/2003 Page 1 o~ 2 K-Mart Redevelopment city of Columbia Heights 238 Units of Owner-Occupied Tow~home$ District # Inflation Rate- Eve.y_ Yaam 0.0000% Pay-Aa-You. Go Intamst Rata: 7.0000% Note Issued Data (Preset Value Dale): 01~-04 L~I T~ Rate. M~m 104.3~0% P~ 2~ Es~a~ ~s~ ~S~ ~ (A - ~ or B - in~) B Ye~ Ois~ ~ ~fi~ Pay 2~ Year ~st~ ~s M~ Assu~s ~ T~ In~t F~ D~ ~sumes La~ Year of Tax Inmnt 20Z2 Fis~l ~sped~es Rang 24.~% L~ T~ Rate · C~ 101.3~5~ P~ 2~ Esti~e State V~Je Properly Tax Rate (Used ~' total taxes) 55.0ooo% Pay 2004 Estimate Markel Value T,t~ Rata {used for total taxes) ~.1141% Pay 2004 Es~mate Con~rnercial Indus~ial Class Rate 1.5%-2.0% Pay 2003 Fi~t t50,000 1.50% Over 150,ooo 2.00% Rental Class Rate 1.25% Pay ;'004 Residentel Class . Urn:let $500.000 1 Over $500,000 1.25% Ciasa RateA~ter Prope~'y Land Building Total Class Original After Conversion Data Map lO PlO O~acfipdon Market Value Market Value Market Value Rate Tax Capacit~ ConversionTax Capaci~ Pa~able 25-302-43-200-61 ~ 152,500 276,800 429,300 1.5%-2.0%7,836 2.00% 8.586 2005 25-302-43-200-04 s~,~ ,* ,4 185,600 228.300 413.900 1.5%-2.D%7,528 2.00% 8,278 2005 25-302-43-200-03 ~ 514,300 1.231,600 1.745,900 1.5%-2.0%34.168 2.00% 34.918 2005 25-302-43-200-02 ~.~ w.,~ 206,100 213.900 420.000 1.$%-2.0%7,650 2.00% 8,400 2005 25-302-43-200-62 ~ 2,200.0~0 t.5%-2.0%43.250 1.00% 22,000 2004 25-302-4~-200-01 w~. 191,700 258,300 450,000 1,5%-2.0%8,250 2.00% 9,000 2005 Totals 1,250,200 2.208,900 5.659,100 108,682 91f182 625 Phase Use Sq. Ft.~Jnits Sq. Ft. AJnite Sq. Fl JUntasTaxes Value Rate Tax Capacit7 Cons~cted Payable I Commercial 75.000 135 4.72 354,327 10.125,000 2.00% 202.500 2006 2008 2 Commercial 40.000 125 4.37 174.976 5,000,000 2.00% 100.000 2007 2009 1 Row Tow~home 32 213,750 2.380.74 76.184 6,840.000 1.00% 68,400 2004 2006 2 Tow~homea 98 237.$00 2,686.65 263.291 23,275.000 1.00% 232,750 2005 2007 3 Flats 114 190,000 2,074 ~4 236,532 21,660.000 1.00% 216,600 2006 2008 TOTAL 115,2~4 1,105t309 66,900~000 820,250 ..... Total Local Fiscal Local F~.a I Slate-wide Local Fiscal Sta~-wide Lose Market Phase Tax Tax Disparities Tax Disparities Pmper~ Tazea Disparities Property MV HmsL Value Total Capach~ Capacity Tax Capacit7 Rate Tax Rate Tax Rate Taxe~ Taxes Credit Taxes Taxes I 202,500 15.1.900 48.600 1.06395 1.32885 0.55000 166,820 64.562 111,375 i 1,55e ~4,327 2 100,000 75,000 24,000 1.08395 1.32885 0.55000 ~2,380 31,882 55,000 ~,T04 174,975 I 68,400 68,400 0 1.08395 0.00000 0.00~00 74,142 0 0 -5.76t ?AOZ 75,184 2 232,750 232,250 0 1.08:395 0.00000 0.00000 252,289 0 g -15,548 26.559 253.281 3 216.600 216,600 0 1.08395 0.00000 0.00000 234,7~4. 0 0 -22,960 24,7BI 23~,532 TOTAL ~20~250 747.650 72,600 1.0839S ~10~415 96,475 166,375 -44r265 76.313 1 105 1. Residential do not pay Slate-wide property tax or Fiscal Disparities. CITY OF COLUMBIA HEIGHTS Base Projec! Captured Sem.,-Annual Stale Aclmin. Semi-Annual Semi-Annual PAYMENT DATE PERIOD BEGINNING Tax Tax Fiscal Tax Gross Tax Audil~' at Met Tax Pre~ent PERIOD F. hIDING Yrl. Mth. Yr. Capacity Capacity Disparities Capacity Irtcmn-dnt 0.36% 10.00% Increment Value Yin, Mth. Yr. 0 0 02-01 2004 108,682 I08,682 Presenl Value Date - 201-06 00 08-01 2004 00 08~01 2004 108.682 108,682 0.0 02-01 2005 00 02-01 2005 91.182 91.182 0.0 08-01 2005 00 08-01 2005 91.182 91.182 0 0 0 0 0 0 0.0 02-01 2006 00 02~O1 2006 91.182 137,582 46,d00 25,148 191) (2,506) 22.551 21.052 0.5 08.O1 2006 0.5 08-01 20O6 91.182 137,5~. 4~,400 25,148 191) 12,506) 22,551 41.392 1.0 02-O1 2007 1.0 02.01 2007 91.182 370.332 279.150 TSI.292 (545) 115,075) 135.673 159.623 1.5 08-01 2007 1.5 08-01 2007 91,182 370,332 279,150 151,292 (545) 115,075) 135,673 273.1~56 2.0 02-01 ~0O8 2.0 02-01 2008 91,182 720.250 48,600 580.468 314,599 11,133) 131.347} 282.120 503.361 2.5 0~01 21X)8 2.5 08-01 20O8 91,182 720,250 48,0O0 ~80,468 314,899 11,133) 131,347) 282,120 725,105 3.0 02-01 2009 3.0 02-01 2009 91.182 820.25~ 72,600 656,468 355,789 11,281) 135,451) 319.058 967,401 3.5 08-01 2009 3.5 08-01 2009 91.182 820,250 72,600 658,4~8 3:35.789 11,281) 135,451) 319,058 1,201,503 4.0 02-01 2010 40 02-01 2010 91,182 820.250 72,600 656,468 355,789 (1,281) 135,451) $19,058 1,427,689 4.5 08-01 2010 4.5 08-01 2010 91,182 820,250 72,600 656,4~8 355,789 1t.281) 135,~51 ) 319.058 1.646.226 5.0 02-01 ~Ott 5,0 02-01 2011 91,182 820,250 72,60O 656,468 355,789 11,281) 135,451) 319.058 1,857,373 5.5 0801 2011 5.5 08-01 2011 91,182 820,250 72.600 656,468 355,789 11,281) 135,451) 319,058 2,061,~80 60 02-01 2012 6.0 02-01 2012 91,182 820,250 72.600 656,468 355,789 11,281) 135,451) 319,058 2,258.488 6.5 0801 2012 6.5 08-01 2012 9t,182 820,250 72,600 656,468 355,789 11,281) 135,451) 319,058 2,448,030 7.0 02-01 2013 7.0 o2-01 2013 91,182 820,250 72,600 656.468 $55.789 11.281) 135,451) 319,058 2,632,932 7.5 0801 2013 7 5 08-01 2013 91,18Z 920.250 72,600 . 6.56,4~8 355,789 (1,281) 135,451) 319.058 2,810,713 8.0 02-01 2014 8.0 02-01 2014 91,182 S20.2 50 72,~=OO 656.468 355.789 11,281) 135,451) 319,058 2,982.481 8.5 08-01 2014 8.5 08-O1 2014 91.182 820~250 72,600 656,4~8 355,789 11,281) 135,451) 319.058 3,148,440 9.0 02-01 2015 90 02.01 2015 91,182 820,250 72.600 656.488 355.789 11,281) (35,451) 319,058 3,308.788 9.5 08~1 2015 95 08-O1 2015 91,182 820,250 72,600 656,468 355,789 11.281) 135,451) 319,058 3,4~3,713 10.0 02-01 2016 lO.O 02.01 2016 91,182 820.2~0 72,600 656,468 355,789 11,281) (35,451) 319.058 3.613.399 10.5 0801 201S 10.5 o8-01 2o16 91,182 820.250 72.600 656.468 355,789 11.281) 135,451) 319,o58 3,758.02'5 11.0 02-01 2017 11.0 02-01 2017 91,182 820,250 72,000 656,468 355,789 11,281) 135,451) $19,058 3,897,757 11.5 0801 2017 11.5 08-01 20t7 91,192 820.250 72.600 656,468 355,789 11,281) 135,451) 319.o58 4.032,765 12.0 02-ol 2018 12.0 02-01 2018 91,182 820.250 72,600 656,468 355,789 11,281) 135,451) 319,058 4,163.208 12.5 08-O1 2018 12.5 08-01 2018 91,182 820.250 72,600 656,468 355,189 11,281) (35,451) 319,058 4,289.239 13.0 02-01 2019 13.0 02-01 2o19 91.182 820.250 72.500 656,468 355,788 11.281) 135,451) 319,0~8 4,411,009 13.5 08-01 2019 13.5 08-01 2019 91.182 820.250 72.600 656,468 355,789 11,281) 135,451) 319,058 4,528.661 14.0 02-01 2020 14.0 02-01 2020 91,182 820,250 72,600 656.468 355,789 11,281) 135,451) 319,058 4,642,334 14.5 08-OI 2020 14.5 08-01 2020 91,182 820.2,50 72,600 656.468 355.789 11,281) 135,451) 319,058 4,752.164 15.0 02.01 2021 150 02-01 2021 91.182 820,250 72.600 65,5,468 355.789 (1,281) 135,451) 319,058 4,858.279 15.5 08-01 2021 15.5 08-01 2021 91~182 820,250 72,600 656.4~18 355,789 11~281) 135,451} 319,058 4,960.806 16.0 02.01 2022 Totals 10:232.898 135,837} {1~019~576) 8r17Sr18~ Present Value Date - 2-01-06 5~725r538 119r815) 1551r201) 4;960~806 NOTES: 1. S~te Auditor payment is based upon I st half, pay 2002 aclual and n-~y increase over term of district- 2. Assumes development in constructed i~1 2004, assessed in 2005 and first increment is paid in ~___ ,, ~m~m,__~,~-~_ ,% _~_~_~ ~ _ -- '-' Diff~ence e ,1,,~40,900I I APPENDIX E MINNESOTA BUSINESS ASSISTANCE FORM (MINNESOTA DEPARTMENT OF TRADE AND ECONOMIC DEVELOPMENT) APPENDIX --Trade &-r- 2003 Minnesota Business Assistance Form Economic Devdopment · The 2003 Minnesota Business Assistance Form (MBAF) is used to report each business subsidy and financial assistance agreement signed from January 1, 2002 through December $1, 2002 per Minn. Stat. § 116J.993 to §116J.995. Please use forms from prior years to report agreements signed before 2002. · The folloxving government agencies must submit a 2003 MBAF even if an agreement was not signed during the period January 1, 2002 through December 31, 2002: 1) any local government/agency that signed a business subsidy agreement since January 1, 1998, or represents a population of more than 2,500; 2) all state government agencies authorized to provide business subsidies. If the local/state government agency does not have any subsidies or assistance to report, please answer questions 1 through 13 and questions 33 and 34. · If a local or state government agency that is required to report has not done so by April 1, DTED will mail a warning. I f it fails to report by June 1, it may not award any business subsidies until a report has been filed. · Questions? Call (65 I) 296-0580. Information on where to mail or fax your completed MBAF(s) is on page 4. ;ection 1 Grantor Information 1. Name of grantor (f~nding entity) 2. Name of person completing this form 3. Street address 4. City 5. ZlP code 6. County 7. Phone number 8. Fax number 9. E-mail address 10. Please indicate who in your organization should receive the 2003 MBAF if different from the person in Question 2. Name/Title Phone number Street address City ZIP code I 1. Classification of grantor bl/lark one. If grantor is enti~ 12. Has your organization held a public hearing on and created by gay 't agency, please indicate affiliation. For adopted criteria for awarding business subsidies in example, a ci~, EDA would check "Cio/government. ") compliance with Minn. Stat. ~ 116J.9947 (Mark one.) El City government El Yes, in 2003 (attach criteria) rq Yes, in 2003 but have not yet adopted criteria El County government El Yes, prior to 2003 El Regional government If Yes: Hearing Date: Year Criteria Submitted.'~ El State government ~ No El Other (Please specify.) ID Other (Please attach explanation.) 13. Has your organization signed any agreements to award a business subsidy or financial assistance from January 1, 2002 through December 31,2002 that is required to be reported under Minn. Stat. § 116J.993 and § l 16J.9947 (Mark one.) ~! Yes (Complete the remainder of the form.) [~ No (Stop here, go to section 5 on page 4.) ;ection 2 Recipient Information 14. Name of business or organization receiving subsidy or financial assistance 15. Address where business subsidy or financial assistance will be used Street address City State ZIP code 16. Does the recipient have a parent corporation? (Mark one.) El Yes (Indicate name and address of parent corporation below. If more than one, indicate ultimate owner.) El No Name of parent corporation Street address City State ZIP code 2003 Minnesota Busifiess Assistance Form (I/13;03) Page I of 4 Dept. of Trade & Economic Development 17. IndustW of recipient's facility (Mark one. J: O Manufacturing [3 Services [321 Retail Trade O Wholesale Trade O Finance, Insurance, Real Estate Fl Construction I-I Other (please spec~') 18. Did the recipient relocate as a result of signing this agreement? (Mark one.) [3 Yes (Indicate city and state of previous address and reason recipient did not complete this project at that address.) Fl No (Go to Question 19.) City/State ofprevious address Reason project not completed at previous address 19. Would the recipient have remained in previous location or relocated elsewhere if not awarded this business subsidy or financial assistance? (Mark one.) D Remained at previous location [3 Relocated to different Minnesota location 121 Relocated outside Minnesota Section 3 Agreement Information 20. Total dollar value of business subsidy or financial assistance (Please separate value by Ope in Questions 24 and 25.) 21. Date agreement signed (In addition to the agreement date, indicate any dates the agreement was amended.) 22. Benefit date (Indicate the date the recipient will benefit from the business subsidy or financial assistance. For example, indicate the date improvements were finished, equipment was placed into service, or the recipient occupied the proper~, whichever is earlier.) 23. Does the agreement provide a business subsidy or one of the four Lypes of financial assistance (see Question 25) required to be reported? (Mark one.) ~ business subsidy ~ financial assistance 24. If the agreement provided a business subsidy, please indicate the type(s) and total dollar value for each type. Fl not applicable, agreement provided financial assistance [3 loan (only principal) Fl grant (i.e., forgivable loan) ~3 tax abatement ~ TIF or other tax reduction or deferral ~ guarantee of payment [3 contribution of property or infrastructure Fl preferential use of governmental facilities 0 land contribution [3 other (Spec~f-y subsidy ~. pe.) 26. If the assistance included tax increment financing, please indicate the type of TIF district? (Mark one.) not applicable, assistance was not in the form of TIF Fl assistance for property polluted by contaminants ~ assistance for renovating building stock or bringing it up to code, and assistance provided for designated historic preservation districts, when 50°,/0 or less of total cost ~ assistance for pollution control or abatement [3 assistance for a TIF soils condition district 25. If the assistance was one of the four types of financial assistance, please indicate the Lype(s). Q not applicable, agreement provided a business subsidy $ $ 27. Are any other grantors providing a business subsidy or financial assistance to the same project? (Mark one.) [3 redevelopment rq renewal and renovation [3 soils condition [3 economic development FI mined underground space O hazardous substance subdistfict Yes (Speci~ each grantor and the value of their assistance below; attach an additional sheet if necessary.) Fl No Grantor(s) and value of the agreement(s): Grantor Value (5;) Grantor Value (5;) 2003 Minnesota BUsiness Assistance Form (1/13/03) Page 2 of 4 Dept. of Trade & Economic Development Section 4 Goals and Public Purpose Identified in the Agreement 28. Minn. Stat. §1 ]6J.994 requires that business subsidy and financial assistance agreements state a public purpose. Which of the following public purposes were stated in the agreement7 (Mark all that apply.) iD Enhancing economic diversity iD Increasing tax base (cannot be only purpose) iD Creating high-qualit~ _job growth iD Other (please specify). ~ Job retention O Stabilizing the communitT 29. Indicate whether the agreement included the following Lypes of goals, and whether the recipient had attained those goals at the time of this report. (Fill in the boxes and attainment date(s) for each goal.) A) Specific wage and job goals to be attained within 2 years B) Other job-creation and/or retention goals C) Other wage goals D) Other goals other than wage and job goals (Please attach descriptions of goals and progress toward attainment if not documented in Q~aestions 30 and 31.) Goals Target attainment All goals established7 dates (month & year) attained7 El Yes El No ID Yes C} No iD Yes El No iD Yes El No iD Yes CI No iD Yes iD No ID Yes iD No IDYes DNo 30. For each of the following wage categories, indicate the job creation and/or retenfiongoals stated in the agreement and the average hourly value of any employer-provided health insurancegoals for those jobs. (On. ly indicate job creation goals in full-time equivalents if you are ,mable to separate goals by full- and part-time positions.) Full-time Part-time/ FTE (only if goals not Hourly Wage Job Seasonal;Temp. stated as l'f/PT) Job Retention Hourly Value of (excluding benefits) Creation Job Creation Job Creation Health Insurance no hourly wage-level goal S less than $7.00 $7.00 to S8.99 s $9.00 to $10.99 $11.00 to $12.99 s. $13.00 to $14.99 $15.00 and higher 31. For each of the following wage categories, indicate the number of actual jobs created and/or retained since the benefit date and the actual hourly value of any employer-provided health insurance for those jobs. (Only indicate job creation in full-time equivalents if you are unable to separate job creation into full- and part-time positions.) Full-time Par't-time/ FTE (only if unable to Hourly Wage ,/ob Seasonal/Temp. separate FT/PT) Job Retention Hourly Value of (excluding benefits) Creation ,/ob Creation Job Creation Health Insurance less than $7.00 S $7.00 to $8.99 $9.00 to $10.99 s $11.00 to $12.99 $13.00 to $14.99 s $15.00 and higher 32. Has the recipient achieved all goals (see Questions 29, 30 and 31) and fulfilled all obli.eations stipulated in the agreement? (Mark one.) iD Yes iD No 2003 Minnesota Business Assistance Form (I/13/03) Page 3 of 4 Dept. of Trade & Economic Development Section 5 Recipients Failing to Fulfill Obligations ~Do not com?lete this section i/you com?teted it on another 2002 MBAF submitted to DTED.) 33. During the period January 1, 2002 through December 3 l, 2002, did your organization have any recipients who failed to report as required by Minn. Stat. §116J.993 and §116J_9947 6g/arkone.) D Yes (Indicate the name of each recipient failing to report and the value ofsubsid, v orfinancial assistance awarded to that recil~ient. .4 ttach additional pages if necessao'.) 121 No Name of recipient Type of subsidy or assistance (See Questions 24 and 25.) Value of subsidy or assistance 34. Did your organization have any recipients who failed to achieve any goals or fulfill any other obligations under an agreement signed on or after Janua~ 1, 2002, that were required to be fulfilled by the time of this reporl?(Mark one.) Yes (Complete the remainder of this section.) ~1 No (Stop here and submit form to DTED .) 35. - 39. Provide the following information for each recipient failing to fulfill goals or any other terms of an agreement that were to be attained by the time of reporting. (.4ttach additionalpages ifnecessa~..) 35. Information on recipient and agreement: Name of recipient in default Type of subsidy or assistance lnitial value of subsidy or assistance Street address of recipient Ciw/ZIP code of recipient Outstanding value of subsidy or assistance 36. Reason(s) for default 6~Iark all that appl. v.): Q recipient ceased operation C~ recipient was unable to fill vacant positions recipient relocated to a different communiw other (Specify reason.) 37. To date, has the recipient fulfilled its repayment obligation? (Mark one.) C] Yes CI No, recipient has begun to repay the assistance. ~ No, recipient has not bec. un to repay the assistance. 38. Has the agreement been amended to extend the recipient's deadline for fulfilling its obligations? (Mark one.) C) Yes ID No 39. Describe the steps being taken to bring recipient into compliance or recoup the subsidy. Return your completed MBAF(s) by .April I, 2003, to: 2002 Minnesota Business Assistance Form Minnesota Department of Trade and Economic Development - AEO 500 Metro Square, 121 East 7~h Place St. Paul, MN 55101-2146 Orfax to: (651)215-3841 2003 Minnesota Business Assistance Form (1/13/03) Page 4 of 4 Dept. of Trade & Economic Development APPENDIX F REDEVELOPMENT QUALIFICATIONS FOR THE DISTRICT To be added to prior to the t~ublic hearing APPENDLX APPENDIX G BUT/FOR QUALIFICATIONS .?,urrent Market Value - Est. New Market Value - Est. Difference Present Value of Tax Increment Difference Value Likely to Occur Without Tax Increment is Less Than: 5,659,i001 , ,oo,oooI 61,240~900[ 5,725,5381 ,55,515,362I 55,515,3621 APPENDIX G-I COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) Meeting of: September 16, 2003 AGENDA SECTION: Items for Consideration ORIGINATING EXECUTIVE NO: 4-¢ DEPARTMENT: EDA DIRECTOR APPROVAL ITEM: Adopt Resolution 2003-16, Approving a BY: Robert Streetar BY: Contract for Private Redevelopment between the DATE: September 10, 2003 Columbia Heights Economic Development Authority and New Heights Development, LLC BACKGROUND: Please find attached the Contract for Private Redevelopment by and between the Columbia Heights Economic Development Authority (EDA) and New Heights Development, LLC (Developer). The purpose of the contract is to clearly identify the obligations of the developer and the EDA with regard to the redevelopment of the Kmart property. A summary of the contract is attached as well as a map summarizing the contract. This contract has been prepared and reviewed in cooperation with Steve Bubul, on Kennedy and Graven, Inc., the City's legal counsel. RECOMMENDATION: Staff recommends Adoption of Resolution 2003-16, approving a Contract for Private Redevelopment with New Heights Development, LLC. RECOMMENDED MOTION: Move to waive the reading of Resolution 2003-16, there being an ample amount of copies available to the public. RECOMMENDED MOTION: Move to Adopt Resolution 2003-16, a Resolution Approving a Contract for Private Redevelopment between the Columbia Heights Economic Development Authority and New Heights Development, LLC; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. Attachments: Contract for Private Redevelopment Summary of Contract and Map EDA ACTION: consent Form2003~EDA Res.2003-16 Contract New Heights Development LLC COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION NO. 2003-16 RESOLUTION APPROVING A CONTRACT FOR PRIVATE REDEVELOPMENT BETWEEN THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY AND NEW HEIGHTS DEVELOPMENT, LLC BE IT RESOLVED By the Board of Commissioners ("Board") of the Columbia Heights Economic Development Authority ("Authority") as follows: Section 1. Recitals. 1.01. The Authority has determined a need to exercise the powers of a housing and redevelopment authority, pursuant to Minnesota Statutes, Sections. 469.090 to 469.108 ("EDA Act"), and is currently administering the Downtown CBD Redevelopment Project ("Redevelopment Project") pursuant to Minnesota Statutes, Sections 469.001 to 469.047 ("HRA Act"). 1.02. The Authority and New Heights Development, LLC (the "Redeveloper") have proposed to enter into a into a Contract for Private Redevelopment (the "Contract"), setting forth the terms and conditions of redevelopment of certain property within the Redevelopment Project, th th generally located east of Central Avenue, between 47 and 49 Avenues. 1.03. The Board has reviewed the Contract and finds that the execution thereof and performance of the Authority's obligations thereunder are in the best interest of the City and its residents. Section 2. Authority Approval; Further Proceedings. 2.01. The Contract as presented to the Board is hereby in all respects approved, subject to modifications that do not alter the substance of the transaction and that are approved by the President and Executive Director, provided that execution of the documents by such officials shall be conclusive evidence of approval. 2.02. The President and Executive Director are hereby authorized to execute on behalf of the Authority the Contract and any documents referenced therein requiting execution by the Authority, and to can'y out, on behalf of the Authority its obligations thereunder. Approved by the Board of Commissioners of the Columbia Heights Economic Development Authority this 16th day of September, 2003. Columbia Heights Economic Development Authority Don Murzyn Jr., President SJB-237387vl CL205-20 Walter R. Fehst, Executive Director e PROPOSED TERMS OF CONTRACT FOR PRIVATE REDEVELOPMENT BETWEEN COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY AND NEW HEIGHTS DEVELOPMENT, LLC September 4, 2003 Property Acquisition and platting The "Redevelopment Property" consists of the current Kmart property and the Arby's property. The Redeveloper has entered into a purchase agreement to acquire both of those parcels, and must acquire them directly from the current owner. The Redeveloper must plat the Redevelopment Property to create two areas: one devoted to the "Housing Improvements" described below, and one devoted to certain "Commercial Improvements" along Central Avenue. The "Future Commercial Property" consists of the remaining property on Central Avenue north of Arby's: Subway/TCBY; E1 Bustan; Welle Auto; Buffalo Wild Wings; and Savers/Hollywood Video. The Redeveloper must use its best efforts to acquire the Future Commercial Property during a one-year negotiation period. During that time, the EDA and Redeveloper will negotiate regarding the Authority's role in the future redevelopment of that property. Redeveloper will be responsible for, and indemnifies Authority against, any relocation benefits in connection with the Redevelopment Property and the Future Commercial Property, and against any claims related to environmental conditions on any of that property. TIF Assistance for Housing Authority will issue a tax increment revenue note (Housing TIF Note) to Redeveloper in aggregate principal amount of $700,000 as reimbursement for the costs of demolishing the Kmart building and certain site-clearing costs for the Kmart property. The Housing Note will bear interest at of 6.0 % and will mature February 1,2011 (which is five years of full tax increment). The Housing Note will be delivered, and interest begin to accrue, when Redeveloper has certified to the Authority that it has incurred eligible costs. The Housing Note will be payable solely from 90% of the tax increment generated from the housing development. Defaults under the Contract (including failure to complete construction of the Housing Improvements or the Commercial Improvements described below) allow the Authority to withhold payments or terminate the Housing Note. SJB-235915vl CL205-20 After all housing units are sold, the Redeveloper will calculate its Gross Profit, and a one-half of the "Excess Profit" (the amount over 15%) will be treated as a prepayment on the Housing Note. 3. TIF Assistance for Commercial Improvements The Authority will negotiate with Redeveloper regarding tax increment assistance for the Commercial Improvements to be built within the replat of the Redevelopment Property. If the parties agree on TIF Assistance for the Commercial Improvements, the Authority will issue a second tax increment revenue note (the "Commercial TIF Note"), on terms similar to the Housing TIF Note. If the parties don't agree on TIF assistance, the Redeveloper is still required to complete at least the minimum "Commercial Improvements" as described in Section 7 below. 4. TIF Assistance for Future Commercial Improvements Redeveloper will have exclusive rights regarding the Future Commercial Property for one year. During that time, Redeveloper will try to acquire that property, and the parties will negotiate regarding the nature of require future improvements and tax increment assistance for that redevelopment. If the parties don't enter into a new or amended agreement regarding the Future Commercial Property by the end of the one-year period, Redeveloper's rights under this part of the Agreement lapse, and the Authority may then negotiate with other developers regarding the Future Commercial Property. 5. Business Subsidy · Tax increment assistance for the Housing Improvements is exempt from the Business Subsidy Act because the assistance is for housing. Any assistance for future commercial redevelopment might be subject to the Business Subsidy Act, depending on the facts at the time. If so, the Authority will hold the required public hearings and enter the required business subsidy agreements at the time decisions are made on the future assistance (whether the near-term Commercial Improvements or the longer-term Future Commercial Improvements). 6. Minimum Improvements and Public Improvements · Redeveloper must build 244 units of market rate owner occupied housing, referred to as the Housing Improvements. All units must be complete by December 31, 2007. SJB-176514vl 2 SA285-51 Redeveloper must build at least 10,000 square feet of commercial space, referred to as the Commercial Improvements. All such improvements must be complete by July 1, 2006. Redeveloper must construct all streets, sewer, water, etc to serve the Housing Improvements and the Commercial Improvements, including installation of oversized sewer main needed to provide capacity for this new development. Details regarding public improvements (schedule, security, etc) will be addressed in a separate planning/PUD agreement to be negotiated as the replat and PUD proceed. 7. Restrictions on Transfer Before completion of construction of the Housing Improvements and the Commercial Improvements, Redeveloper may not transfer the property and be released from its obligations under the Agreement without prior Authority approval. The Authority may require that any transferee have the ability to complete the development in accordance with the Agreement. After completion of all housing units and all Commercial Improvements, there is no restriction on transfer. SJB-176514vi 3 SA285-5l Kmart Redevelopment Contract Summary N Lincoln Terrace .mFUTURE COMMERCIAL PROPERTY Future Improvements >Substantial Commercial User / Anchor >Developer has an exclusive for 12 months to prepare a development plan. >Public Assistance to be negotiated. MMERCIAL PROPERTY mercial Improvements -~ >Minimum 10,000 s~f. commercial --FI >Buildout must commence no later than 7/1/05 I I I ~d be complete no later than 7/1/06 >Public Assitance to be negotiated ~ / I ~ HOUSlNG PROPERTY I I I ~ [ 13t Housing Improvements I I I ! L >244 For-Sale Units I-  208 Urban Flats C REDEVELOPMENT PROPERTY 36 Urban Townhomes Sale Prices $175 - $330 >Build out 12/31/03 - 12131/07 >Public Assistance pay-as-you-go note up to $700,000 for demolition of building and other site-clearing costs. Fifth Draft September 3, 2003 CONTRACT FOR PRIVATE REDEVELOPMENT By and Between COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY COLUMBIA HEIGHTS, MINNESOTA and NEW HEIGHTS DEVELOPMENT, LLC Dated as of: ,2003 This document was drafted by: KENNEDY & GRAVEN, Chartered 470 Pillsbury Center Minneapolis, Minnesota 55402 Telephone: (612) 337-9300 SJB-235566v5 CL205-20 PREAMBLE Section 1.1. Section 2.1. Section 2.2. Section 3.1. Section 3.2. Section 3.3. Section 3.4. Section 3.5. Section 3.6. Section 3.7. Section 3.8. Section 3.9. Section 3.10. Section 4.1. Section 4.2. Section 4.3. Section 4.4. Section 5.1. Section 5.2. Section 5.3. TABLE OF CONTENTS ARTICLE I Definitions Definitions .......................................................................................................... 2 ARTICLE II Representations and Warranties Representations by the Authority ....................................................................... 6 Representations and Warranties by the Redeveloper ......................................... 6 ARTICLE III Property Acquisition, Conveyance and Financing Status of the Property ......................................................................................... 8 Environmental Conditions ................................................................................. 8 Public Redevelopment Costs ............................................................................. 9 Issuance of Housing Note .................................................................................. 9 Tax Increment Assistance for Commercial Improvements ............................. 10 Issuance of Commercial Note .......................................................................... 11 Future Commercial Property ............................................................................ 11 Relocation ........................................................................................................ 12 Payment of Administrative Costs .................................................................... 12 Records ............................................................................................................ 13 ARTICLE IV Construction of Minimum Improvements and Public Improvements Construction of Minimum Improvements and Public Improvements ............. 14 Construction Plans ........................................................................................... 14 Completion of Construction ............................................................................. 15 Certificate of Completion ................................................................................ 16 ARTICLE V Insurance Insurance .......................................................................................................... 17 Subordination ................................................................................................... 18 Qualifications ................................................................................................... 18 SJB-235566v5 i CL205-20 Section 6.1. Section 6.2. Section 6.3. Section 7.1. Section 8.1. Section 8.2. Section 8.3. Section 9.1. Section 9.2. Section 9.3. Section 9.4. Section 9.5. Section 10.1. Section 10.2. Section 10.3. Section 10.4. Section 10.5. Section 10.6. Section 10.7. Section 10.8. Section 10.9. Section 10.10. Section 10.11. ARTICLE VI Tax Increment; Taxes Right to Collect Delinquent Taxes ................................................................... 19 Review of Taxes .............................................................................................. 19 Qualifications ................................................................................................... 19 ARTICLE VII Financing Mortgage Financing ......................................................................................... 20 ARTICLE VIII Prohibitions Against Assignment and Transfer; Indemnification Representation as to Redevelopment ............................................................... 21 Prohibition Against Redevelop er's Transfer of Property and Assignment of Agreement ............................................................................... 21 Release and Indemnification Covenants .......................................................... 23 ARTICLE IX Events of Default Events of Default Defined ............................................................................... 24 Remedies on Default ........................................................................................ 24 No Remedy Exclusive ...................................................................................... 25 No Additional Waiver Implied by One Waiver ............................................... 25 Attorney Fees ................................................................................................... 25 ARTICLE X Additional Provisions Conflict of Interests; Authority Representatives Not Individually Liable ....... 26 Equal Employment Oppommity ...................................................................... 26 Restrictions on Use .......................................................................................... 26 Provisions Not Merged With Deed .................................................................. 26 Titles of Articles and Sections ......................................................................... 26 Notices and Demands ...................................................................................... 26 Counterparts ..................................................................................................... 27 Recording ......................................................................................................... 27 Amendment ...................................................................................................... 27 Authority or City Approvals ............................................................................ 27 Termination ...................................................................................................... 27 SJB-235566v5 ii CL205-20 SCHEDULE A SCHEDULE B SCHEDULE C Description of Redevelopment Property Authorizing Resolution Certification of Completion SJB-235566v5 iii CL205-20 CONTRACT FOR PRIVATE REDEVELOPMENT THIS AGREEMENT, made on or as of the ~ day of ., 2003, by and between COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY, COLUMBIA HEIGHTS, MINNESOTA, a public body corporate and politic (the "Authority"), established pursuant to Minnesota Statutes, Sections 469.090 to 469.1081 (hereinafter referred to as the "Act"), and NEW HEIGHTS DEVELOPMENT, LLC, a Minnesota limited liability company (the "Redeveloper"). WITNESSETH: WHEREAS, the Authority was created pursuant to the Act and was authorized to transact business and exercise its powers by a resolution of the City Council of the City of Columbia Heights ("City"); and WHEREAS, the City and the Authority (as successor to the Housing and Redevelopment Authority in and for the City of Columbia Heights) have undertaken a program to promote redevelopment of land which that is characterized by blight and blighting factors within the City, and in this connection the Authority administers a redevelopment project known as the Downtown CDB Redevelopment Project ("Project") pursuant to Minnesota Statutes, Sections 469.001 to 469.047 (the "HRA Act"); and WHEREAS, pursuant to the Act and the HRA Act, the Authority is authorized to acquire real property, or interests therein, and to undertake certain activities to facilitate the redevelopment of real property by private enterprise; and WHEREAS, within the Project, the City and Authority have created the Kmart/Central Avenue Tax Increment Financing District ("TIF District") in order to facilitate redevelopment of certain property in the Project; and WHEREAS, the Authority and Redeveloper have previously entered into a Preliminary Development Agreement dated as of June 17, 2003 regarding proposed redevelopment of the property described in Schedule A hereto, designated as the Redevelopment Property and the Future Commercial Property; and WHEREAS, this Agreement is intended to supersede and replace the Preliminary Agreement in all respects; and WHEREAS, the Authority believes that the redevelopment of the Redevelopment Property pursuant to this Agreement, and fulfillment generally of this Agreement, are in the vital and best interests of the City and the health, safety, morals, and welfare of its residents, and in accord with the public purposes and provisions of the applicable State and local laws and requirements under which the Project has been undertaken and is being assisted. NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: SJB-235566v5 1 CL205-20 ARTICLE I Definitions Section 1.1. Definitions. In this Agreement, unless a different meaning clearly appears from the context: "Act" means the Economic Development Authority Act, Minnesota Statutes, Sections 469.090 to 469.108, as amended. "Agreement" means this Agreement, as the same may be from time to time modified, amended, or supplemented. "Authority" means the Columbia Heights Economic Development Authority, or any successor or assign. "Authority Representative" means the Executive Director of the Authority, or any person designated by the Executive Director to act as the Authority Representative for the purposes of this Agreement. "Available Tax Increment" means 90 percent of the Tax Increment attributable to the Redevelopment Property (or relevant portion thereof, as the context requires), received by the Authority in the six-month period before any schedule payment date on any Note. "Business Day" means any day except a Saturday, Sunday, legal holiday, a day on which the City is closed for business, or a day on which banking institutions in the City are authorized by law or executive order to close. "Business Subsidy Act" means Minnesota Statues, Sections 116J.993 to 116J.995, as amended. "Certificate of Completion" means the certification provided to the Redeveloper, or the purchaser of any part, parcel or unit of the Redevelopment Property, pursuant to Section 4.4 of this Agreement. "City" means the City of Columbia Heights, Minnesota. "Commercial Improvements" means the construction on the Commercial Property of at least 10,000 square feet of retail, office or service facilities that are permitted or conditional uses for such site under the City zoning ordinance. "Commercial Note" means the Tax Increment Revenue Note substantially in the form contained in the Second Authorizing Resolution, issued in accordance with Section 3.6 hereof. SJB-235566v5 2 CL205-20 "Construction Plans" means the plans, specifications, drawings and related documents on the construction work to be performed by the Redeveloper on the Redevelopment Property which a) shall be as detailed as the plans, specifications, drawings and related documents which are submitted to the appropriate building officials of the City, and (b) shall include at least the following for each building: (1) site plan; (2) foundation plan; (3) basement plans; (4) floor plan for each floor; (5) cross sections of each (length and width); (6) elevations (all sides); (7) landscape plan; and (8) such other plans or supplements to the foregoing plans as the Authority may reasonably request to allow it to ascertain the nature and quality of the proposed construction work. "County" means the County of Anoka, Minnesota. "Event of Default" means an action by the Redeveloper listed in Article IX of this Agreement. "Future Commercial Improvements" has the meaning provided in Section 3.7 hereof. "Future Commercial Property" means the property so described in Schedule A. "Holder" means the owner of a Mortgage. "Housing Improvements means the construction by the Redeveloper on the Housing Property of at least 244 units of market-rate owner-occupied housing. "Housing Note" means the Tax Increment Revenue Note substantially in the form contained in the Initial Authorizing Resolution, issued in accordance with Section 3.4 hereof. "initial Authorizing Resolution" means the resolution of the Authority, substantially in the form of attached Schedule B to authorize the issuance of the Housing Note. "Minimum Improvements" means the Housing Improvements and the Commercial Improvements. "Mortgage" means any mortgage made by the Redeveloper which is secured, in whole or in part, with the Redevelopment Property and which is a permitted encumbrance pursuant to the provisions of Article VIII of this Agreement. "Note" means either the Housing Note or the Commercial Note, or both, as the context requires. "Planning Contract" has the meaning provided in Section 3.1 (b) hereof. "Preliminary Development Agreement" means the Preliminary Development Agreement between the Authority and the Redeveloper dated as of June 17, 2003. "Public Improvements" has the meaning provided in Section 4.1 (b) hereof. SJB-235566v5 3 CL205-20 - "Public Redevelopment Costs" has the meaning provided in Section 3.3 hereof. "Redeveloper" means New Heights Development, LLC or its permitted successors and assigns. "Redevelopment Project" means the Authority's Downtown CDB Redevelopment Project. "Redevelopment Property" means the property so described on Schedule A, and after replatting means the Housing Property and the Commercial Property. "Redevelopment Plan" means the Authority's Redevelopment Plan for the Redevelopment Project, as amended. "Second Authorizing Resolution" means the resolution of the Authority, substantially in the form of attached Schedule B to authorize the issuance of the Commercial Note. "State" means the State of Minnesota. "Tax Increment" means that portion of the real property taxes which is paid with respect to the Redevelopment Property and which is remitted to the Authority as tax increment pursuant to the Tax Increment Act. The term Tax Increment does not include any amounts retained by or payable to the State auditor under Section 469.177, subd. 11 of the Tax Increment Act. "Tax Increment Act" means the Tax Increment Financing Act, Minnesota Statutes, Sections 469.174 to 469.1799, as amended. "Tax Increment District" or "TIF District" means the Authority's Kmart/Central Avenue Tax Increment Financing District. "Tax Increment Plan" or "T~ Plan" means the Authority's Tax Increment Financing Plan for the TIF District, as approved by the City and Authority on ,2003, and as it may be amended from time to time. "Tax Official" means any County assessor; County auditor; County or State board of equalization, the commissioner of revenue of the State, or any State or federal district court, the tax court of the State, or the State Supreme Court. "Termination Date" means the date the Authority receives the last installment of Tax Increment from the County. "Transfer" has the meaning set forth in Section 8.2(a) hereof. "Unavoidable Delays" means delays beyond the reasonable control of the party seeking to be excused as a result thereof which are the direct result of war, terrorism, strikes, other labor troubles, fire or other casualty to the Minimum Improvements, litigation commenced by third parties which, by injunction or other similar judicial action, directly results in delays, or acts of any SJB-235566v5 4 CL205-20 federal, state or local governmental unit (other than the Authority in exercising its rights under this Agreement) which directly result in delays. Unavoidable Delays shall not include delays in the Redeveloper's obtaining of permits or governmental approvals necessary to enable construction of the Minimum Improvements by the dates such construction is required under Section 4.3 of this Agreement. SJB-235566v5 5 CL205-20 ARTICLE II Representations and Warranties Section 2.1. Representations by the Authority. The Authority makes the following representations as the basis for the undertaking on its part herein contained: (a) The Authority is an economic development authority duly organized and existing under the laws of the State. Under the provisions of the Act, the Authority has the power to enter into this Agreement and carry out its obligations hereunder. (b) The activities of the Authority are undertaken to foster the redevelopment of certain real property which for a variety of reasons is presently underutilized, to eliminate current blighting factors and prevent the emergence of further blight at a critical location in the City, to create increased tax base in the City, to increase housing opportunities for various income levels in the City, and to stimulate further development of the TIF District and Redevelopment Project as a whole. Section 2.2. Representations and Warranties by the Redeveloper. The Redeveloper represents and warrants that: (a) The Redeveloper is a limited liability company duly organized and in good standing under the laws of the State of Minnesota, is not in violation of any provisions of its article of organization or the laws of the State, is duly authorized to transact business within the State, has power to enter into this Agreement and has duly authorized the execution, delivery and performance of this Agreement by proper action of its members. (b) Upon acquisition of the Redevelopment Property, the Redeveloper will construct, operate and maintain the Minimum Improvements in accordance with the terms of this Agreement, the Redevelopment Plan and all applicable local, state and federal laws and regulations (including, but not limited to, environmental, zoning, building code and public health laws and regulations). (c) The Redeveloper has received no notice or communication from any local, state or federal official that the activities of the Redeveloper or the Authority in the Project Area may be or will be in violation of any environmental law or regulation (other than those notices or communications of which the Authority is aware). The Redeveloper is aware of no facts the existence of which would cause it to be in violation of or give any person a valid claim under any local, state or federal environmental law, regulation or review procedure. (d) The Redeveloper will construct the Minimum Improvements in accordance with all local, state or federal energy-conservation laws or regulations. (e) The Redeveloper will obtain, in a timely manner, all required permits, licenses and approvals, and will meet, in a timely manner, all requirements of all applicable local, state and SJB-235566v5 6 CL205-20 federal laws and regulations which must be obtained or met before the Minimum Improvements may be lawfully constructed. (f) Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of, the terms, conditions or provisions of any partnership or company restriction or any evidences of indebtedness, agreement or instrument of whatever nature to which the Redeveloper is now a party or by which it is bound, or constitutes a default under any of the foregoing. (g) Whenever any Event of Default occurs and if the Authority or the City shall employ attorneys or incur other expenses for the collection of payments due or to become due or for the enforcement of performance or observance of any obligation or agreement on the part of the Redeveloper under this Agreement, and the Authority or the City or prevails in such action, the Redeveloper agrees that it shall, within ten days of written demand by the City, pay to the City the reasonable fees of such attorneys and such other expenses so incurred by the City. (h) The Redeveloper shall promptly advise City in writing of all litigation or claims affecting any part of the Minimum Improvements and all written complaints and charges made by any governmental authority materially affecting the Minimum Improvements or materially affecting Redeveloper or its business which may delay or require changes in construction of the Minimum Improvements. (i) The proposed redevelopment by the Redeveloper hereunder would not occur but for the tax increment financing assistance being provided by the Authority hereunder. (j) The Redeveloper is not currently in default under any business subsidy agreement with any grantor, as such terms are defined in the Business Subsidy Act. SJB-235566v5 7 CL205-20 ARTICLE III Property Acquisition~ Conveyance and Financine Section 3.1. Status of the Property. (a) As of the date of this Agreement, the Redeveloper has entered into a purchase agreement to acquire the Redevelopment Property. The Redeveloper will acquire the Redevelopment Property in accordance with the purchase agreement. The Future Commercial Property is owned by various third parties. The Authority has no obligation to acquire the Redevelopment Property or the Future Commercial Property. (b) By no later than December 31, 2003, the Redeveloper, at its cost, will prepare and obtain City approval of (i) a replat of the Redevelopment Property to create one or more parcels for development of the Housing Improvements (the "Housing Property") and one or more parcels for development of the Commercial Improvements (the "Commercial Property"); and (ii) a planned unit development ("PUD") of the Redevelopment Property. Redeveloper must comply with all City ordinances and procedures in connection with the replat and PUD. In connection with the plat and PUD, the parties agree and understand that the Redeveloper and City will enter into a development agreement (the "Planning Contract") that addresses planning and land use requirements, including usual and customary security for Redeveloper's obligations, and is consistent with the covenants regarding the Minimum Improvements and Public Improvements described in Article IV hereof. The parties agree and understand that Redeveloper will construct, at its cost, all Public Improvements described in Section 4.1(b), and that the Planning Contract will specify the construction schedule for such improvements consistent with the required build-out schedule for Minimum Improvements under Article IV, and will also specify which Public Improvements must be dedicated to the City and the terms and conditions for acceptance of such improvements. (c) The Redeveloper will use its best efforts to acquire the Future Commercial Property in accordance with Section 3.7 hereof. Section 3.2. Environmental Conditions. (a) The Redeveloper acknowledges that the Authority makes no representations or warranties as to the condition of the soils on the Redevelopment Property or the Future Commercial Property or the fitness of such property for construction of the Minimum Improvements or any Future Commercial Improvements or any other purpose for which the Redeveloper may make use of such property, and that the assistance provided to the Redeveloper under this Agreement neither implies any responsibility by the Authority or the City for any contamination of the Redevelopment Property or the Future Commercial Property nor imposes any obligation on such parties to participate in any cleanup of such property. (b) Without limiting its obligations under Article VIII of this Agreement the Redeveloper further agrees that it will indemnify, defend, and hold harmless the Authority, the City, and their governing body members, officers, and employees, from any claims or actions arising out of the presence, if any, of hazardous wastes or pollutants existing on or in the Redevelopment Property, unless and to the extent that such hazardous wastes or pollutants are present as a result of the actions or omissions of the indemnitees. Nothing in this section will be construed to limit or affect any SJB-235566v5 8 CL205-20 limitations on liability of the City or Authority under State or federal law, including without limitation Minnesota Statutes Sections 466.04 and 604.02. Section 3.3. Public Redevelopment Costs. The Redeveloper shall demolish all existing buildings on the Redevelopment Property and undertake all soil corrections, utility relocation, and grading and excavation needed to construct the Minknmn Improvements (such activities are collectively referred to as the "Public Redevelopment Costs"). The term Public Redevelopment Costs also includes Authority costs paid by the Redeveloper under Section 3.9 hereof, and relocation costs, if any, paid by Redeveloper under Section 3.8 hereof. Section 3.4. Issuance of Housing Note. (a) Terms. In order to reimburse the Redeveloper for a portion of the Public Redevelopment Costs incurred by Redeveloper in connection with the Housing Improvements, the Authority shall issue and the Redeveloper shall purchase the Housing Note in the maximum aggregate principal amount of $700,000. The Housing Note will be payable solely from the Available Housing Tax Increment attributable to the Housing Improvements and the Housing Property. The terms of the Housing Note, including maturity, payment dates and interest rate, will be substantially those set forth in the form of the Housing Note shown in Schedule B. The Housing Note will be dated as of the date of delivery, and interest will accrue from such date. Notwithstanding anything to the contrary herein, no payments will be made on the Housing Note prior to issuance of the Certificate of Completion for the Commercial Improvements. (b) Issuance. Before issuance and delivery of the Housing Note, Redeveloper must submit to the Authority one or more certificates signed by the Redeveloper's duly authorized representative, containing the following: (i) a statement that each cost identified in the certificate is a Public Redevelopment Cost incurred on or in connection with the Housing Property and that no part of such cost has been included in any previous certification (ii) evidence that each identified Public Redevelopment Cost has been paid or incurred by or on behalf of the Redeveloper, and (iii) a statement that no uncured Event of Default by the Redeveloper has occurred and is continuing under the Agreement. The Authority may, if not satisfied that the conditions described herein have been met, remm any certificate with a statement of the reasons why the it is not acceptable and requesting such further documentation or clarification as the Authority may reasonably require. The Authority will deliver the Housing Note upon receipt and approval of certificates evidencing Public Redevelopment Costs in at least the principal amount of the Housing Note; provided that in no event will the Authority deliver the Housing Note prior to (i) filing of the TIF District for certification with the County under Section 6.4 hereof, and (ii) execution and recording of the Assessment Agreement under Section 6.3 hereof. (c) Termination of right to Housing Note. Notwithstanding anything to the contrary in this Agreement, if the conditions for delivery of the Housing Note are not met by one year after the date of required completion of the Housing Improvements under Section 4.3, the Authority may terminate the Housing Note by ten days written notice to the Redeveloper. Thereafter neither party shall have any obligations or liability to the other hereunder, except that any obligations of the Redeveloper under Sections 3.2, 3.6 and 8.3 survive such termination. (d) Qualifications. The Redeveloper understands and acknowledges that the Authority makes no representations or warranties regarding the amount of Available Tax Increment, or that SJB-235566v5 9 CL205-20 revenues pledged to the Initial Note will be sufficient to pay the principal and interest on the Housing Note. Any estimates of Tax Increment prepared by the Authority or its financial advisors in connection with the TIF District or this Agreement are for the benefit of the Authority, and are not intended as representations on which the Redeveloper may rely. If the Public Redevelopment Costs exceed the principal amount of the Housing Note, such excess is the sole responsibiliy of Redeveloper. (e) Prepayment from Gross Profit. Within 60 days after closing on Redeveloper's sale to third parties of the final unit of completed Housing Improvements (the "Final Closing Date"), the Redeveloper must deliver to the Authority evidence of its Gross Profit on construction and sale of the Housing Improvements under this Agreement. For the purposes of this Agreement, the term "Gross Profit" is a percentage calculated as the aggregate proceeds from sales of each unit sold to third parties ("Sale Proceeds"), less the total Development Cost, divided by total Sale Proceeds. The term Development Cost means the sum of the following costs incurred by the Redeveloper in connection with the Minimum Improvements: (1) the total purchase price paid or payable by the Redeveloper for acquisition of the Redevelopment Property (without regard to reimbursement thereof under the Note), including closing costs paid by the Redeveloper; (2) the cost of constructing the Housing Improvements, including without limitation engineering, architect fees, surveying, legal and similar soft costs; (3) costs of construction financing for the Housing Improvements, including loan fees, interest paid during construction, attorney fees, and any costs paid by Redeveloper under Section 3.9 of this Agreement; and (4) closing costs on sale of lots to third parties, including broker fees and commissions paid to third parties or to Redeveloper's sales associates, all to the extent paid by the Redeveloper. The Authority or its agents shall be entitled to review and audit the calculation of Gross Profit. The amount by which Gross Profit exceeds fifteen percent is a percentage referred as "Excess Profit." The Excess Profit, multiplied by the total Sale Proceeds, is the Excess Amount. One half of the Excess Amount will be applied as prepayment of the outstanding principal amount of the Note in accordance with the terms of Section 5(b) of the Note. Such event must be evidenced by delivery by the Authority to the Redeveloper of a written notice stating the Excess Amount. The one-half share of Excess Amount will be deemed prepaid as of the Final Closing Date. Section 3.5. Tax Increment Assistance for Commercial Improvements. (a) Before commencement of construction of the Commercial Improvements, the Authority and the Redeveloper will negotiate in good faith regarding the amount, if any, of tax increment assistance needed to make development of the Commercial Improvements economically feasible. The negotiation will commence upon presentation by the Redeveloper to the Authority of a development proforma for those improvements and other documentation reasonably required by the Authority to justify the need for public assistance. In determining the amount, if any, of tax increment assistance to be provided, the parties agree that the following principles will apply: (i) the amount of assistance will depend upon the final determination as to the type and square footage of Commercial Improvements to be constructed, and upon analysis of the Redeveloper's pro forma and related documentation for that development plan; SJB-235566v5 1 0 CL205-20 (ii) the pro forma must show that the tax increment assistance is solely in the amount necessary to permit Redeveloper to develop the Commercial Property, or convey to third parties for such development, at prevailing market prices for vacant urban property; and (iii) any assistance will be provided solely from Available Tax Increment attributable to the Commercial Improvements and the Commercial Property, unless the Authority determines in its sole discretion to make an additional pledge of Available Tax Increment fi'om the Housing Property (subordinate to the Housing Note). (b) Failure of the parties to agree on the terms of tax increment assistance for the Commercial Improvements will not relieve Redeveloper's obligation to construct such improvements under Article IV hereof. Section 3.6. Issuance of Commercial Note. (a) If the parties negotiate an amount of tax increment assistance under Section 3.5, the Authority will approve the Second Authorizing Resolution to authorize issuance of the Commercial Note, contingent upon (i) the Authority having determined that issuance of the Commercial Note does not constitute a "business subsidy" within the meaning of the Business Subsidy Act, or (ii) the parties having negotiated the terms of a business subsidy agreement and the Authority and City having approved such agreement after public hearing in accordance with the Business Subsidy Act. (b) The Commercial Note will be in a form substantially similar to that set forth in the Initial Authorizing Resolution attached as Schedule B, provided that the Commercial Note will be payable solely fi'om the Available Tax Increment attributable to the Commercial Improvements and the Commercial Property (subject to the optional additional pledge described in Section 3.5(a)(iii) hereof). The Authority and the Redeveloper agree that the consideration from the Redeveloper for the purchase of the Commercial Note shall consist of the Redeveloper's payment of Public Redevelopment Costs in connection with development of the Commercial Improvements. All other terms of Section 3.4 apply to the Commercial Note by substituting the word "Commercial" for "Housing" where it appears in that Section. (c) The Authority's obligation to approve the Second Authorizing Resolution and issue the Commercial Note are subject to the Authority's legal authority to take such actions under the laws existing at the time of such actions. Section 3.7. Future Commercial Property. (a) For a period of twelve months after the date of this Agreement (the "Negotiation Period"), the Redeveloper and Authority will negotiate in good faith regarding development of the Future Commercial Property for uses and under terms that are mutually satisfactory to the parties. The Authority and City agree that during the Negotiation Period, so long as there is no uncured Event of Default by Redeveloper under this Agreement, they will not negotiate or contract with any party other than Redeveloper concerning the development of the Future Commercial Property. SJB-235566v5 1 1 CL205-20 (b) During the Negotiation Period, the Redeveloper will (i) use its best efforts to acquire all parcels of the Future Commercial Property, (ii) negotiate a letter of intent with a substantial commercial user (an "Anchor Redeveloper") for all or part of the Future Commercial Property and submit such letter to the Authority, and (iii) submit to the Authority a concept plan for redevelopment of that property for Future Commercial Improvements. The parties will negotiate in good faith regarding the need for tax increment financing assistance in connection with the Future Commercial Improvements, based on the principles described in Section 3.5. If the parties agree that assistance is required, they will enter into an amendment to this Agreement providing for the terms of the assistance including, if required under the Business Subsidy Act, the terms of any business subsidy agreement. (c) If the Redeveloper and Authority have not entered into a written agreement regarding the Future Commercial Improvements by the end of the Negotiation Period, this Section 3.7 will be deemed terminated and thereafter neither party shall have liability to the other under this Section. However, the expiration of the Negotiation Period will have no affect on any other rights or obligations of the parties under the remainder of this Agreement. Section 3.8. Relocation. (a) The Redeveloper shall be responsible for the relocation of all tenants of the Redevelopment Property and the Future Commercial Property, including the provision of any relocation benefits and payments. The Redeveloper shall consult with a relocation consultant, approved by the Authority, regarding the relocation benefits and payments to be provided to them in exchange for their relocation from the Redevelopment Property. Such amounts are reimbursable as Public Redevelopment Costs under this Agreement, limited to those costs approved by the relocation consultant. (b) The Redeveloper shall provide to the Authority written agreements, in a form approved by the Authority, from each owner and occupant of the Redevelopment Property, under which such owners and occupants agree to be relocated from the Redevelopment Property or the Furore Commercial Property on terms contained in the agreements. In addition, the Redeveloper shall furnish to the Authority a written certification from its attomey that waivers of relocation benefits contained in such agreements were explained to each owner and occupant in accordance with the terms of the agreement. (c) Without limiting the Redeveloper's obligations under Section 8.3 hereof, the Redeveloper will indemnify, defend and hold harmless the Authority, the City, and their governing body members, employees, agents and contractors from any and all claims for benefits or payments arising out of the relocation or displacement of any person from the Redevelopment Property or the Future Commercial Property as a result of the implementation of this Agreement. Section 3.9. Payment of Administrative Costs. (a) The parties acknowledge that, pursuant to the Preliminary Development Agreement, Redeveloper paid the Authority $17,500 as reimbursement for (1) the cost of a planning study by Dahlgren, Shardlow and Uban ($12,500), and (2) a portion of the cost of a sanitary sewer study ($5,000). By no later than December 31, 2003, Redeveloper must pay to the Authority an additional $42,500 to reimburse the Authority for the balance of the costs of the planning study ($37,500) and the sewer study ($5,000). Upon termination of this Agreement, the Authority shall have no obligation to return to Redeveloper any portion of the amounts paid byRedeveloper under this paragraph. SJB-235566v5 12 CL205-20 (b) The Redeveloper is responsible for "Administrative Costs," which means out-of-pocket costs incurred by the Authority attributable to or incurred in connection with the negotiation and preparation of this Agreement, the Preliminary Development Agreement, and other documents and agreements in connection with the Redevelopment Property and the Future Commercial Property, including without limitation the cost of any traffic studies. Administrative Costs are in addition to the reimbursement for costs of the planning and sewer study referenced in paragraph (a) above. In order to secure payment of the Administrative Costs, the Redeveloper delivered to the Authority cash or a certified check in the amount of $10,000 upon execution of the Preliminary Development Agreement. The Authority will utilize such funds to pay or reimburse itself for Administrative Costs. If at any one or more times during the term of this Agreement, the Authority determines that Administrative Costs will exceed $10,000 and that additional security is required, the Authority shall notify the Redeveloper of the amount of such additional security. Within ten calendar days of receipt of such notice, the Redeveloper shall deliver to the Authority the required additional security. Section 3.10. Records. The Authority or its representatives shall have the right at all reasonable times after reasonable notice to inspect, examine and copy all books and records of Redeveloper relating to the Minimum Improvements. SJB-235566v5 13 CL205-20 ARTICLE IV Construction of Minimum Improvements and Public Improvements Section 4.1. Construction of Minimum Improvements and Public Improvements. (a) The Redeveloper agrees that, upon acquisition of the Redevelopment Property, it will construct or cause construction of the Minimum Improvements on the Redevelopment Property, in accordance with approved Construction Plans and at all times while Redeveloper owns the Redevelopment Property, will operate and maintain, preserve and keep the respective components of the Minimum Improvements or cause such components be maintained, preserved and kept with the appurtenances and every part and parcel thereof, in good repair and condition. (b) The Redeveloper must prepare plans and specifications for and construct all streets and associated traffic improvements, sewer, water, storm sewer improvements, sidewalks, landscaping, open space and related amenities located within or serving the Redevelopment Property, including without limitation any oversizing of sanitary sewer mains necessary to provide adequate capacity for the redevelopment described in this Agreement (collectively, the "Public Improvements"), all in accordance with the Planning Contract. Before commencing such construction, the Redeveloper must submit plans and specifications regarding the Public Improvements for approval by the City substantially in accordance with procedures for Construction Plans described in Section 4.2. All work on the Public Improvements shall be in accordance with the approved construction plans and shall comply with all City requirements regarding such improvements. The parties agree and understand that the City will accept the improvements in accordance with City procedures and the Planning Contract. (c) The Authority and Redeveloper will cooperate and use their best efforts to obtain a grant from the Metropolitan Council to finance a portion of the Public Improvements, including without limitation the cost of increasing sanitary sewer capacity to serve the redevelopment described in this Agreement. Absent such grant, Redeveloper remains responsible to pay all costs of Public Improvements. Section 4.2. Construction Plans. (a) Before commencement of construction of the Minimum Improvements, the Redeveloper shall submit to the Authority Construction Plans. The Construction Plans shall provide for the construction of the Minimum Improvements and shall be in conformity with the TIF Plan, Redevelopment Plan, this Agreement, the Planning Contract and all applicable State and local laws and regulations. The Authority Representative will approve the Construction Plans in writing iff (i) the Construction Plans conform to the terms and conditions of this Agreement.; (ii) the Construction Plans conform to the goals and objectives of the Redevelopment Plan; (iii) the Construction Plans conform to all applicable federal, state and local laws, ordinances, rules and regulations; (iv) the Construction Plans are adequate to provide for construction of the Minimum Improvements; (v) the Construction Plans do not provide for expenditures in excess of the funds available to the Redeveloper from all sources (including Redeveloper's equity) for construction of the Minimum Improvements; and (vi) no Event of Default has occurred. Approval may be based upon a review by the City's Building Official of the Construction Plans. No approval by the Authority Representative shall relieve the Redeveloper of SJB-235566v5 1 4 CL205-20 the obligation to comply with the terms of this Agreement or of the Development Plan, applicable federal, state and local laws, ordinances, rules and regulations, or to construct the Minimum Improvements in accordance therewith. No approval by the Authority Representative shall constitute a waiver of an Event of Default. If approval of the Construction Plans is requested by the Redeveloper in writing at the time of submission, such Construction Plans shall be deemed approved unless rejected in writing by the Authority Representative, in whole or in part. Such rejections shall set forth in detail the reasons therefore, and shall be made within 10 days atler the date of their receipt by the Authority. If the Authority Representative rejects any Construction Plans in whole or in part, the Redeveloper shall submit new or corrected Construction Plans within 10 days after written notification to the Redeveloper of the rejection. The provisions of this Section relating to approval, rejection and resubmission of corrected Construction Plans shall continue to apply until the Construction Plans have been approved by the Authority. The Authority Representative's approval shall not be unreasonably withheld, delayed or conditioned. Said approval shall constitute a conclusive determination that the Construction Plans (and the Minimum Improvements constructed in accordance with said plans) comply to the Authority's satisfaction with the provisions of this Agreement relating thereto. (b) If the Redeveloper desires to make any material change in the Construction Plans after their approval by the Authority, the Redeveloper shall submit the proposed change to the Authority for its approval. If the Construction Plans, as modified by the proposed change, conform to the requirements of Section 4.2 of this Agreement with respect to such previously approved Construction Plans, the Authority shall approve the proposed change and notify the Redeveloper in writing of its approval. Such change in the Construction Plans shall, in any event, be deemed approved by the Authority unless rejected, in whole or in part, by written notice by the Authority to the Redeveloper, setting forth in detail the reasons therefor. Such rejection shall be made within ten (10) days after receipt of the notice of such change. The Authority's approval of any such change in the Construction Plans will not be unreasonably withheld. Section 4.3. Completion of Construction. Subject to Unavoidable Delays, the Redeveloper must commence construction of the Housing Improvements by December 31, 2003, and must substantially complete construction of the Housing Improvements by December 31, 2007. Subject to Unavoidable Delays, the Redeveloper must commence construction of the Commercial Improvements by July 1, 2005, and must substantially complete construction of the Commercial Improvements by July 1, 2006. All work with respect to the Minimum Improvements to be constructed or provided by the Redeveloper on the Redevelopment Property shall be in substantial conformity with the Construction Plans as submitted by the Redeveloper and approved by the Authority, and with he Planning Contract. If the Redeveloper is making substantial progress with respect to the redevelopment project, and is unable to meet one or more of the above-referenced deadlines, the Authority and the Redeveloper shall negotiate in good faith for a reasonable period to extend the time in which necessary action(s) must be taken or occur, the lapse of which time would otherwise constitute a default under this Agreement. The Redeveloper agrees for itself, its successors and assigns, and every successor in interest to the Redevelopment Property, or any part thereof, that the Redeveloper, and such successors and assigns, shall promptly begin and diligently prosecute to completion the redevelopment of the Redevelopment Property through the construction of the Minimum Improvements thereon, and that SJB-235566v5 1 5 CL205-20 such construction shall in any event be commenced and completed within the period specified in this Section 4.3 of this Agreement. Subsequent to conveyance of the Redevelopment Property, or any part thereof, to the Redeveloper, and until construction of the Minimum Improvements has been completed, the Redeveloper shall make reports, in such detail and at such times as may reasonably be requested by the Authority, as to the actual progress of the Redeveloper with respect to such construction. Section 4.4. Certificate of Completion. (a) Promptly after substantial completion of the Minimum Improvements (and each component thereof) in accordance with those provisions of the Agreement relating solely to the obligations of the Redeveloper to construct the Minimum Improvements (including the dates for completion thereof), the Authority will furnish the relevant Redeveloper with a Certificate of Completion in substantially the form attached as Schedule C. Such certification by the Authority shall be (and it shall be so provided in the Deed and in the certification itself) a conclusive determination of satisfaction and termination of the agreements and covenants in the Agreement and in the Deed with respect to the obligations of the Redeveloper, and its successors and assigns, to construct the relevant component of the Minimum Improvements and the dates for the completion thereof. Such certification and such determination shall not constitute evidence of compliance with or satisfaction of any obligation of the Redeveloper to any Holder of a Mortgage, or any insurer of a Mortgage, securing money loaned to finance the Minimum Improvements, or any part thereof. (b) Upon Redeveloper's request, the Authority shall furnish to the Redeveloper a Certificate of Completion for each housing unit upon substantial completion of such trait, as evidenced by issuance of a certificate of occupancy therefor by the responsible inspecting authority. (c) Each Certificate of Completion provided for in this Section 4.4 of this Agreement shall be in such form as will enable it to be recorded in the proper office for the recordation of deeds and other instruments pertaining to the Redevelopment Property. If the Authority shall refuse or fail to provide any certification in accordance with the provisions of this Section 4.4 of this Agreement, the Authority shall, within thirty (30) days afler written request by the Redeveloper, provide the Redeveloper with a written statement, indicating in adequate detail in what respects the Redeveloper has failed to complete the Minimum Improvements in accordance with the provisions of the Agreement, or is otherwise in default, and what measures or acts it will be necessary, in the opinion of the Authority, for the Redeveloper to take or perform in order to obtain such certification. (d) The construction of the Minimum Improvements shall be deemed to be substantially completed when the Redeveloper has received a certificate of occupancy from the City for all housing units (with respect to the Housing Improvements) and all commercial facilities (with respect to the Commercial Improvements), and all site improvements have been substantially completed as reasonably determined by the Authority Representative. SJB-235566v5 1 6 CL205-20 ARTICLE V Insurance Section 5.1. Insurance. (a) The Redeveloper will provide and maintain at all times during the process of constructing the Minimum Improvements an All Risk Broad Form Basis Insurance Policy and, from time to time during that period, at the request of the Authority, furnish the Authority with proof of payment of premiums on policies covering the following: (i) Builder's risk insurance, written on the so-called "Builder's Risk -- Completed Value Basis," in an amount equal to one hundred percent (100%) of the insurable value of the Minimum Improvements at the date of completion, and with coverage available in nonreporting form on the so-called "all risk" form of policy. The interest of the Authority shall be protected in accordance with a clause in form and content satisfactory to the Authority; (ii) Comprehensive general liability insurance (including operations, contingent liability, operations of subcontractors, completed operations and contractual liability insurance) together with an Owner's Contractor's Policy with limits against bodily injury and property damage of not less than $1,000,000 for each occurrence (to accomplish the above-required limits, an umbrella excess liability policy may be used); and (iii) Workers' compensation insurance, with statutory coverage. (b) All insurance required in Article V of this Agreement shall be taken out and maintained in responsible insurance companies selected by the Redeveloper which are authorized under the laws of the State to assume the risks covered thereby. Upon request, the Redeveloper will deposit annually with the Authority policies evidencing all such insurance, or a certificate or certificates or binders of the respective insurers stating that such insurance is in force and effect. Unless otherwise provided in this Article V of this Agreement each policy shall contain a provision that the insurer shall not cancel nor modify it in such a way as to reduce the coverage provided below the amounts required herein without giving written notice to the Redeveloper and the Authority at least thirty (30) days before the cancellation or modification becomes effective. In lieu of separate policies, the Redeveloper may maintain a single policy, blanket or umbrella policies, or a combination thereof, having the coverage required herein, in which event the Redeveloper shall deposit with the Authority a certificate or certificates of the respective insurers as to the amount of coverage in force upon the Minimum Improvements. (c) The Redeveloper agrees to notify the Authority immediately in the case of damage exceeding $100,000 in amount to, or destruction of, the Minimum Improvements or any portion thereof resulting from fire or other casualty. In such event the Redeveloper will forthwith repair, reconstruct and restore the Minimum Improvements to substantially the same or an improved condition or value as it existed prior to the event causing such damage and, to the extent necessary to accomplish such repair, reconstruction and restoration, the Redeveloper will apply the net SJB-235566v5 17 C L205 -20 proceeds of any insurance relating to such damage received by the Redeveloper to the payment or reimbursement of the costs thereof. The Redeveloper shall complete the repair, reconstruction and restoration of the Minimum Improvements, whether or not the net proceeds of insurance received by the Redeveloper for such purposes are sufficient to pay for the same. Any net proceeds remaining after completion of such repairs, construction and restoration shall be the property of the Redeveloper. (d) The Redeveloper and the Authority agree that all of the insurance provisions set forth in this Article V shall terminate upon the termination of this Agreement. Section 5.2. Subordination. Notwithstanding anything to the contrary contained in this Article V, the rights of the Authority with respect to the receipt and application of any proceeds of insurance shall, in all respects, be subject and subordinate to the rights of any lender under a Mortgage approved pursuant to Article VII of this Agreement. Section 5.3. Qualifications. Notwithstanding anything herein to the contrary, the parties acknowledge and agree that: (a) The provisions of Section 5.1 hereof shall not apply to a housing unit from and after the date that such unit is substantially completed and sold to an owner-occupant. (b) Upon transfer of the Redevelopment Property or portion thereof to another person or entity except for sales to owner-occupant, the Redeveloper will remain obligated under Section 5.1 hereof relating to such portion transferred, unless the Redeveloper is released from such obligations in accordance with the terms and conditions of Section 8.2(b) or 8.3 hereof. SJB-235566v5 18 CL205-20 ARTICLE VI Tax Increment; Taxes Section 6.1. Right to Collect Delinquent Taxes. The Redeveloper acknowledges that the Authority is providing substantial aid and assistance in furtherance of the redevelopment described in this Agreement, in part through issuance of the Note. The Redeveloper understands that the Tax Increments pledged to payment of the Note are derived from real estate taxes on the Minimum Improvements, which taxes must be promptly and timely paid. To that end, the Redeveloper agrees for itself, its successors and assigns, in addition to the obligation pursuant to statute to pay real estate taxes, that it is also obligated by reason of this Agreement to pay before delinquency all real estate taxes assessed against the Redevelopment Property and the Minimum Improvements. The Redeveloper acknowledges that this obligation creates a contractual right on behalf of the Authority through the Termination Date to sue the Redeveloper or its successors and assigns to collect delinquent real estate taxes and any penalty or interest thereon and to pay over the same as a tax payment to the county auditor. In any such suit, the Authority shall also be entitled to recover its costs, expenses and reasonable attorney fees. Section 6.2. Review of Taxes. The Redeveloper agrees that prior to the Termination Date, it will not cause a reduction in the real property taxes paid in respect of the Redevelopment Property through: (A) willful destruction of the Redevelopment Property or any part thereof; or (B) willful refusal to reconstruct damaged or destroyed property pursuant to Section 5.1 of this Agreement. The Redeveloper also agrees that it will not, prior to the Termination Date, apply for a deferral of property tax on the Redevelopment Property pursuant to any law, or transfer or permit transfer of the Redevelopment Property to any entity whose ownership or operation of the property would result in the Redevelopment Property being exempt from real estate taxes under State law (other than any portion thereof dedicated or conveyed to the City or Authority in accordance with this Agreement). Section 6.3. Qualifications. Notwithstanding anything herein to the contrary, the parties acknowledge and agree that: (a) The provisions of Sections 6.1 and 6.2 hereof shall not apply to a housing unit from and after the date that such unit is substantially completed and sold to an owner-occupant. (b) Upon transfer of the Redevelopment Property or portion thereof to another person or entity except for sales to owner-occupants, the Redeveloper will remain obligated under Sections 6.1 and 6.2 hereof relating to such portion transferred, unless the Redeveloper is released from such obligations in accordance with the terms and conditions of Section 8.2(b) or 8.3 hereof. SJB-235566v5 1 9 CL205-20 ARTICLE VII Financin~ Section 7.1. Mortgage Financing. (a) Before the Redeveloper's Closing Date, the Redeveloper shall submit to the City evidence of one or more commitments for financing which, together with committed equity for such construction, is sufficient for payment of the Minimum Improvements. Such commitments may be submitted as short term £mancing, long term mortgage financing, a bridge loan with a long term take-out financing commitment, or any combination of the foregoing. (b) If the Authority finds that the financing is sufficiently committed and adequate in amount to pay the costs specified in paragraph (a) then the Authority shall notify the Redeveloper in writing of its approval. Such approval shall not be unreasonably withheld and either approval or rejection shall be given within twenty (20) days from the date when the Authority is provided the evidence of financing. A failure by the Authority to respond to such evidence of financing shall be deemed to constitute an approval hereunder. If the Authority rejects the evidence of financing as inadequate, it shall do so in writing specifying the basis for the rejection. In any event the Redeveloper shall submit adequate evidence of financing within ten (10) days after such rejection. (c) In the event that there occurs a default under any Mortgage authorized pursuant to Section 7.1 of this Agreement, the Redeveloper shall cause the Authority to receive copies of any notice of default received by the Redeveloper from the holder of such Mortgage. Thereafter, the Authority shall have the right, but not the obligation, to cure any such default on behalf of the Redeveloper within such cure periods as are available to the Redeveloper under the Mortgage documents. In the event there is an event of default under this Agreement, the Authority will transmit to the Holder of any Mortgage a copy of any notice of default given by the Authority pursuant to Article IX of this Agreement. (d) In order to facilitate the securing of other financing, the Authority agrees to subordinate its rights under this Agreement provided that such subordination shall be subject to such reasonable terms and conditions as the Authority and Holder mutually agree in writing. Notwithstanding anything to the contrary herein, any subordination agreement must include the provision described in Section 7.1 (c). SJB-235566v5 20 CL205-20 ARTICLE VIII Prohibitions Against Assignment and Transfer; Indemnification Section 8.1. Representation as to Redevelopment. The Redeveloper represents and agrees that its purchase of the Redevelopment Property, and its other undertakings pursuant to the Agreement, are, and will be used, for the purpose of redevelopment of the Redevelopment Property and not for speculation in land holding. Section 8.2. Prohibition Against Redeveloper's Transfer of Property and Assignment of Agreement. The Redeveloper represents and agrees that until issuance of the Certificate of Completion for the Minimum Improvements: (a) Except as specifically described in this Agreement, the Redeveloper has not made or created and will not make or create or suffer to be made or created any total or partial sale, assignment, conveyance, or lease, or any trust or power, or transfer in any other mode or form of or with respect to this Agreement or the Redevelopment Property or any part thereof or any interest therein, or any contract or agreement to do any of the same, to any person or entity (collectively, a "Transfer"), without the prior written approval of the Authority's board of commissioners. The term "Transfer" does not include (i) encumbrances made or granted by way of security for, and only for, the purpose of obtaining construction, interim or permanent financing necessary to enable the Redeveloper or any successor in interest to the Redevelopment Property or to construct the Minimum Improvements or component thereof, or (ii) any lease, license, easement or similar arrangement entered into in the ordinary course of business related to operation of the Minimum Improvements. Notwithstanding the prohibitions against transfer contained in this section, the Redeveloper shall have the right to transfer, (partial or full) ownership interests in the Redeveloper, this Agreement, or any parcel of the Redevelopment Property to any entity or entities in which the Redeveloper or the member of the Redeveloper (Bruce A. Nedegaard) has at least a fifty percent (50%) interest. (b) If the Redeveloper seeks to effect a Transfer prior to issuance of the Certificate of Completion, the Authority shall be entitled to require as conditions to such Transfer that: (1) any proposed transferee shall have the qualifications and financial responsibility, in the reasonable judgment of the Authority, necessary and adequate to fulfill the obligations undertaken in this Agreement by the Redeveloper as to the portion of the Redevelopment Property to be transferred; and (2) Any proposed transferee, by instrument in writing satisfactory to the Authority and in form recordable in the public land records of Anoka County, Minnesota, shall, for itself and its successors and assigns, and expressly for the benefit of the Authority, have expressly assumed all of the obligations of the Redeveloper under this Agreement as to the portion of the Redevelopment Property to be transferred and agreed to be subject to all the conditions and restrictions to which the Redeveloper is subject as to such portion; SJB-235566v5 2 1 CL205-20 provided, however, that the fact that any transferee of, or any other successor in interest whatsoever to, the Redevelopment Property, or any part thereof, shall not, for whatever reason, have assumed such obligations or so agreed, and shall not (unless and only to the extent otherwise specifically provided in this Agreement or agreed to in writing by the Authority) deprive the Authority of any rights or remedies or controls with respect to the Redevelopment Property, the Minimum Improvements or any part thereof or the construction of the Minimum Improvements; it being the intent of the parties as expressed in this Agreement that (to the fullest extent permitted at law and in equity and excepting only in the manner and to the extent specifically provided otherwise in this Agreement) no transfer of, or change with respect to, ownership in the Redevelopment Property or any part thereof, or any interest therein, however consummated or occurring, and whether voluntary or involuntary, shall operate, legally, or practically, to deprive or limit the Authority of or with respect to any rights or remedies on controls provided in or resulting from this Agreement with respect to the Redevelopment Property that the Authority would have had, had there been no such transfer or change. In the absence of specific written agreement by the Authority to the contrary, no such transfer or approval by the Authority thereof shall be deemed to relieve the Redeveloper, or any other party bound in any way by this Agreement or otherwise with respect to the Redevelopment Property, from any of its obligations with respect thereto. ' (3) Any and all instruments and other legal documents involved in effecting the transfer of any interest in this Agreement or the Redevelopment Property governed by this Article VIII, shall be in a form reasonably satisfactory to the Authority. (c) If the conditions described in paragraph (b) are satisfied then the Transfer will be approved and the Redeveloper shall be released from its obligation under this Agreement, as to the portion of the Redevelopment Property that is transferred, assigned, or otherwise conveyed. The provisions of this paragraph (c) apply to all subsequent transferors, assuming compliance with the terms of this Article. (d) Upon issuance of the Certificate of Completion, the Redeveloper may transfer or assign the Minimum Improvements and/or the Redeveloper's rights and obligations under this Agreement with respect to such property without the prior written consent of the Authority; provided that: (i) until the Termination Date the transferee or assignee is bound by all the Redeveloper's obligations hereunder with respect to the property and rights transferred. The Redeveloper shall submit to the Authority written evidence of any such transfer or assignment, including the transferee or assignee's express assumption of the Redeveloper's obligations under this Agreement. If the Redeveloper fails to provide such evidence of transfer and assumption, the Redeveloper shall remain bound by all obligations with respect to the subject property under this Agreement; and (ii) upon compliance with clause (d)(i) above (whether the transfer occurred before or after issuance of the Certificate of Completion), the Redeveloper shall be released from its obligations under this Agreement with respect to the property transferred. SJB-235566v5 22 CL205-20 The provisions of this paragraph (d) apply to all subsequent transferors, assuming compliance with the terms of this Article. (e) Nothing in this Article VIII will be construed to require, as a condition for release of the Redeveloper hereunder or otherwise, that purchasers of any unit assume any obligations of the Redeveloper. Upon sale of any residential unit to an initial owner-occupant, the Authority will provide to Redeveloper or the buyer a certificate in recordable form releasing the unit from all encumbrances of this Agreement. Section 8.3. Release and Indemnification Covenants. (a) The Redeveloper releases from and covenants and agrees that the Authority and the City and the governing body members, officers, agents, servants and employees thereof shall not be liable for and agrees to indemnify and hold harmless the Authority and the City and the governing body members, officers, agents, servants and employees thereof against any loss or damage to property or any injury to or death of any person occurring at or about or resulting from any defect in the Minimum Improvements or the Public Improvements. (b) Except for any willful or negligent misrepresentation or any willful or wanton misconduct or negligence of the following named parties, the Redeveloper agrees to protect and defend the Authority and the City and the governing body members, officers, agents, servants and employees thereof (the "Indemnified Parties"), now or forever, and further agrees to hold the Indemnified Parties harmless from any claim, demand, suit, action or other proceeding whatsoever by any person or entity whatsoever arising or purportedly arising from this Agreement, or the transactions contemplated hereby or the acquisition, construction, installation, ownership, and operation of the Minimum Improvements and Public Improvements. (c) Except for any negligence of the Indemnified Parties (as defined in clause (b) above), and except for any breach by any of the Indemnified Parties of their obligations under this Agreement, the Indemnified Parties shall not be liable for any damage or injury to the persons or property of the Redeveloper or its officers, agents, servants or employees or any other person who may be about the Minimum Improvements or Public Improvements due to any act of negligence of any person. (d) All covenants, stipulations, promises, agreements and obligations of the Authority contained herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the Authority and not of any governing body member, officer, agent, servant or employee of the Authority in the individual capacity thereof. SJB-235566v5 23 CL2.05-20 ARTICLE IX Events of Default Section 9.1. Events of Default Defined. The following shall be "Events of Default" under this Agreement and the term "Event of Default" shall mean, whenever it is used in this Agreement, any one or more of the following events, after the non-defaulting party provides 30 days written notice to the defaulting party of the event, but only if the event has not been cured within said 30 days or, if the event is by its nature incurable within 30 days, the defaulting party does not, within such 30-day period, provide assurances reasonably satisfactory to the party providing notice of default that the event will be cured and will be cured as soon as reasonably possible: (a) Failure by the Redeveloper or the Authority to observe or perform any covenant, condition, obligation, or agreement on its part to be observed or performed under this Agreement or the Planning Contract; (b) The Redeveloper: (i) files any petition in bankruptcy or for any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under the United States Bankruptcy Act or under any similar federal or State law; (ii) makes an assignment for benefit of its creditors; (iii) admits in writing its inability to pay its debts generally as they become due; or (iv) is adjudicated a bankrupt or insolvent. Section 9.2. Remedies on Default. (a) Whenever any Event of Default referred to in Section 9.1 of this Agreement occurs, the non-defaulting party may exercise its fights under this Section 9.2 after providing thirty days written notice to the defaulting party of the Event of Default, but only if the Event of Default has not been cured within said thirty days or, if the Event of Default is by its nature incurable within thirty days, the defaulting party does not provide assurances reasonably satisfactory to the non-defaulting party that the Event of Default will be cured and will be cured as soon as reasonably possible: (b) Upon an Event of Default by the Redeveloper, the Authority may withhold payments under any Note in accordance with its terms, which withheld amount is payable, without interest thereon, on the first payment date after the default is cured. (c) If an Event of Default continues for more than three years after the date of receipt by the Redeveloper of the default notice, the Authority may terminate the Note. SJB-235566v5 24 CL205-20 (d) If the Event of Default constitutes breach of restrictions on Transfer of the Redevelopment Property under Section 8.2 hereof, the Authority may terminate the Note if the default is not cured within the periods provided in Section 9.1. (e) Take whatever action, including legal, equitable or administrative action, which may appear necessary or desirable to collect any payments due under this Agreement, or to enforce performance and observance of any obligation, agreement, or covenant under this Agreement. Section 9.3. No Remedy Exclusive. No remedy herein conferred upon or reserved to the Authority or Redeveloper is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the Authority to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such notice as may be required in this Article IX. Section 9.4. No Additional Waiver Implied by One Waiver. In the event any agreement contained in this Agreement should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. Section 9.5. Attorney Fees. Whenever any Event of Default occurs and if the Authority shall employ attorneys or incur other expenses for the collection of payments due or to become due or for the enforcement of performance or observance of any obligation or agreement on the part of the Redeveloper under this Agreement, the Redeveloper agrees that it shall, within 10 days of written demand by the Authority, pay to the Authority the reasonable fees of such attorneys and such other expenses so incurred by the Authority. SJB-235566v5 25 CL205-20 ARTICLE X Additional Provisions Section 10.1. Conflict of Interests; Authority Representatives Not Individually Liable. The Authority and the Redeveloper, to the best of their respective knowledge, represent and agree that no member, official, or employee of the Authority shall have any personal interest, direct or indirect, in the Agreement, nor shall any such member, official, or employee participate in any decision relating to the Agreement which affects his personal interests or the interests of any corporation, partnership, or association in which he is, directly or indirectly, interested. No member, official, or employee of the Authority shall be personally liable to the Redeveloper, or any successor in interest, in the event of any default or breach by the Authority or County or for any mount which may become due to the Redeveloper or successor or on any obligations under the terms of the Agreement. Section 10.2. Equal Employment Opportunity. The Redeveloper, for itself and its successors and assigns, agrees that during the construction of the Minimum Improvements provided for in the Agreement it will comply with all applicable federal, state and local equal employment and non-discrimination laws and regulations. Section 10.3. Restrictions on Use. The Redeveloper agrees that until the Termination Date, the Redeveloper, and such successors and assigns, shall devote the Redevelopment Property to, the operation of the Minimum Improvements for uses described in the definition of such term in this Agreement, and shall not discriminate upon the basis of race, color, creed, sex or national origin in the sale, lease, or rental or in the use or occupancy of the Redevelopment Property or any improvements erected or to be erected thereon, or any part thereof. Section 10.4. Provisions Not Merged With Deed. None of the provisions of this Agreement are intended to or shall be merged by reason of any deed transferring any interest in the Redevelopment Property and any such deed shall not be deemed to affect or impair the provisions and covenants of this Agreement. Section 10.5. Titles of Articles and Sections. Any titles of the several parts, Articles, and Sections of the Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 10.6. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand, or other communication under the Agreement by either party to the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally; and (a) in the case of the Redeveloper, is addressed to or delivered personally to the Redeveloper at ; and SJB-235566v5 26 CL205-20 (b) in the case of the Authority, is addressed to or delivered personally to the Authority at 100 Civic Center Parkway, Columbia Heights, Minnesota 55337, Attn: Executive Director; or at such other address with respect to either such party as that party may, from time to time, designate in writing and forward to the other as provided in this Section. Section 10.7. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute one and the same instrument. Section 10.8. Recording. The Authority may record this Agreement and any amendments thereto with the Anoka County recorder. The Redeveloper shall pay all costs for recording. Section 10.9. Amendment. This Agreement may be amended only by written agreement approved by the Authority and the Redeveloper. Section 10.10. Authori_ty or City Approvals. Unless otherwise specified, any approval required by the Authority under this Agreement may be given by the Authority Representative. Section 10.11. Termination. This Agreement terminates on the Termination Date, except that termination of the Agreement does not terminate, limit or affect the rights of any party that arise before the Termination Date. SJB-235566v5 27 CL205-20 IN WITNESS WHEREOF, the Authority has caused this Agreement to be duly executed in its name and behalf and its seal to be hereunto duly affixed and the Redeveloper has caused this Agreement to be duly executed in its name and behalf on or as of the date first above written. COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY By. Its President By. Its Executive Director STATE OF MINNESOTA ) ) ss. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this __ day of , 2003, by and , the President and Executive Director of the Columbia Heights Economic Development Authority, a public body politic and corporate, on behalf of the Authority. Notary Public SJB-235566v5 S- 1 CL205-20 NEW HEIGHTS DEVELOPMENT, LLC By Its STATE OF MINNESOTA ) ) ss. COUNTY OF ) The foregoing instrument was acknowledged before me this ~ day of ., 2003 by , the of New Heights Development, LLC, a Minnesota limited liability company, on behalf of the company. Notary Public SJB-235566v5 S-2 CL205-20 .. SCHEDULE A Redevelopment Property Future Commercial Property S.~B-235566v5 A- 1 CL205-20 Kmart Redevelopment REDEVELOPMENT PROPERTY HOUSING PROPERTY HollSJll~J ImpllOVemel ~$ >g44 Fo r-~le Ulflls 208 ~l~ll FL~s ~ Ulbal To'~ldlom~ I Sele Prices $175 - $330 tAwj. Price :'l~llilll otl1 12:314)3 - 12/31/07 >Ptd~lic Assistmtce tPlll~iiC Reilevelopll~ellt Cosls - KIIkll Oell~Oi SCHEDULE B AUTHORIZING RESOLUTION Authorizing Resolution COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION NO. RESOLUTION AWARDING THE SALE OF, AND PROVIDING THE FORM, TERMS, COVENANTS AND DIRECTIONS FOR THE ISSUANCE OF ITS $500,000 TAXABLE TAX INCREMENT REVENUE NOTES, SERIES 20 BE IT RESOLVED BY the Board of Commissioners ("Board") of the Columbia Heights Economic Development Authority, Columbia Heights, Minnesota (the "Authority") as follows: Section 1. Authorization; Award of Sale. 1.01. Authorization. The Authority and the City of Columbia Heights have heretofore approved the establishment of the Kmart/Central Avenue Tax Increment Financing District (the "TIF District") the Downtown CBD Redevelopment Project (the "Project"), and have adopted a tax increment financing plan for the purpose of financing certain improvements within the Project. In connection with the TIF District, the Authority and City have approved a Contract for Private Redevelopment between the Authority and New Heights Development, LLC (the "Agreement"). Pursuant to Minnesota Statutes, Section 469.178, the Authority is authorized to issue and sell its bonds for the purpose of financing a portion of the public development costs of the Project. Such bonds are payable from all or any portion of revenues derived from the TIF District and pledged to the payment of the bonds. The Authority hereby finds and determines that it is in the best interests of the Authority that it issue and sell its Taxable Tax Increment Revenue Note in the maximum principal amount of $500,000 (the "Note") for the purpose of financing certain public redevelopment costs of the Project. 1.03. Issuance, Sale, and Terms of the Note. The Authority hereby delegates to the Executive Director the determination of the date on which the Note is to be delivered, in accordance with the Agreement. The Note shall be issued to New Heights Development, LLC ("Owner"). The Note shall be dated as of the date of delivery, shall mature no later than February 1,2011 and shall bear interest at the rate of 6.0 % per annum from the date of original issue of the Note. The Note is issued in consideration of payment by Owner of certain Public Redevelopment Costs in at least the principal amount of the Note, in accordance with the Agreement. Section 2. Form of Note. The Note shall be in substantially the following form, with the blanks to be properly filled in and the principal amount and payment schedule adjusted as of the date of issue: SJB-235566v5 B- 1 CL205-20 UNITED STATE OF A1MERICA STATE OF MINNESOTA COUNTY OF ANOKA COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY No. R-1 $500,000 TAXABLE TAX INCREMENT REVENUE NOTE SERIES 20 Date Rate of Original Issue 6.0 % ,2003 The Columbia Heights Economic Development Authority ("Authority") for value received, certifies that it is indebted and hereby promises to pay to New Heights Development, LLC or registered assigns (the "Owner"), the principal sum of $500,000 or so much thereof as has been from time to time advanced (the "Principal Amount"), as provided in the Agreement defined hereafter, together with interest on the unpaid balance thereof accrued from the date of original issue hereof at the rate of 6.0 percent per annum (the "Stated Rate"). This Note is given in accordance with that certain Contract for Private Redevelopment between the Issuer and the Owner dated as of ., 2003 (the "Agreement") and the authorizing resolution (the "Resolution") duly adopted by the Authority on ,2003. Capitalized terms used and not otherwise defined herein have the meaning provided for such terms in the Agreement unless the context clearly requires otherwise. 1. Payments. Principal and interest ("Payments") shall be paid on August 1, 2006 and each February 1 and August 1 thereafter to and including February 1,2011 ("Payment Dates") in the amounts and from the sources set forth in Section 3 herein. Payments shall be applied first to accrued interest, and then to unpaid principal. Payments are payable by mail to the address of the Owner or such other address as the Owner may designate upon 30 days written notice to the Authority. Payments on this Note are payable in any coin or currency of the United States of America which, on the Payment Date, is legal tender for the payment of public and private debts. 2. Interest. Interest accruing from the date of original issue through and including February 1, 2006 will be compounded semiannually on February 1 and August 1 of each year and added to principal. Interest shall be computed on the basis of a year of 360 days and charged for actual days principal is unpaid. 3. Available Tax Increment. All payments on this Note are payable on each Payment Date solely from and in the amount of the "Available Tax Increment," which means, on each Payment Date, 95 percent of the Tax Increment attributable to the [Housing] [Commercial] SJB-235566v5 B-2 CL205-20 Property as defined in the Agreement that is paid to the Authority by Anoka County in the six months preceding the Payment Date. The Authority shall have no obligation to pay principal of and interest on this Note on each Payment Date from any source other than Available Tax Increment and the failure of the Authority to pay the entire amount of principal or interest on this Note on any Payment Date shall not constitute a default hereunder as long as the Authority pays principal and interest hereon to the extent of such pledged revenues. The Authority shall have no obligation to pay unpaid balance of principal or accrued interest that may remain after the final Payment on February 1,2011. 4. Default. Upon an Event of Default by the Redeveloper under the Agreement, the Authority may exercise the remedies with respect to this Note described in Section 9.2 of the Agreement, the terms of which are incorporated herein by reference. 5. Optional Prepayment. (a) The principal sum and all accrued interest payable under this Note is prepayable in whole or in part at any time by the Authority without premium or penalty. No partial prepayment shall affect the amount or timing of any other regular payment otherwise required to be made under this Note. (b) Upon receipt by Redeveloper of the Authority's written statement of the Excess Amount as defined in Section 3.4(e) of the Agreement, one-half of such Excess Amount will be deemed to constitute, and will be applied to, prepayment of the principal amount of this Note. Such deemed prepayment is effective as of the Final Closing Date as defined in Section 3.4(e) of the Agreement, and will be recorded by the Registrar in its records for the Note. Upon request of the Owner, the Authority will deliver to the Owner a statement of the outstanding principal balance of the Note after application of the deemed prepayment under this paragraph. 6. Nature of Obligation. This Note is one of an issue in the total principal amount of $500,000 issued to aid in financing certain public redevelopment costs and administrative costs of a Project undertaken by the Authority pursuant to Minnesota Statutes, Sections 469.001 through 469.047, and is issued pursuant to the Resolution, and pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections 469.174 to 469.179. This Note is a limited obligation of the Authority which is payable solely from the revenues pledged to the payment hereof under the Resolution. This Note and the interest hereon shall not be deemed to constitute a general obligation of the State of Minnesota or any political subdivision thereof, including, without limitation, the Authority. Neither the State of Minnesota, nor any political subdivision thereof shall be obligated to pay the principal of or interest on this Note or other costs incident hereto except from and to the extent of the revenues pledged hereto, and neither the full faith and credit nor the taxing power of the State of Minnesota or any political subdivision thereof is pledged to the payment of the principal of or interest on this Note or other costs incident hereto. 7. Registration and Transfer. This Note is issuable only as a fully registered note without coupons. As provided in the Resolution, and subject to certain limitations set forth therein, this Note is transferable upon the books of the Authority kept for that purpose at the principal office of the City Chief Financial Officer, by the Owner hereof in person or by such Owner's attorney SJB-235566v5 B-3 C£ 205-20 duly authorized in writing, upon surrender of this Note together with a written instrument of transfer satisfactory to the Authority, duly executed by the Owner. Upon such transfer or exchange and the payment by the Owner of any tax, fee, or governmental charge required to be paid by the Authority with respect to such transfer or exchange, there will be issued in the name of the transferee a new Note of the same aggregate principal amount, bearing interest at the same rate and maturing on the same dates. This Note shall not be transferred to any person unless the Authority has been provided with an opinion of counsel or a certificate of the transferor, in a form satisfactory to the Authority, that such transfer is exempt from registration and prospectus delivery requirements of federal and applicable state securities laws. IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions, and things required by the Constitution and laws of the State of Minnesota to be done, to exist, to happen, and to be performed in order to make this Note a valid and binding limited obligation of the Authority according to its terms, have been done, do exist, have happened, and have been performed in due form, time and manner as so required. IN WITNESS WHEREOF, the Board of Commissioners of the Columbia Heights Economic Development Authority have caused this Note to be executed with the manual signatures of its President and Executive Director, all as of the Date of Original Issue specified above. COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY Executive Director President REGISTRATION PROVISIONS The ownership of the unpaid balance of the within Note is registered in the bond register of the City Chief Financial Officer, in the name of the person last listed below. Date of Registration Registered Owner ~ Signature of City Chief Financial Officer New Heights Development, LLC Federal Tax I.D. No. Section 3. Terms, Execution and Delivery_. 3.01. Denomination, Payment. The Note shall be issued as a single typewritten note numbered R- 1. S.IB-235566v5 B-4 C[.205-20 The Note shall be issuable only in fully registered form. Principal of and interest on the Note shall be payable by check or draft issued by the Registrar described herein. 3.02. Dates; Interest Payment Dates. Principal of and interest on the Note shall be payable by mail to the owner of record thereof as of the close of business on the fifteenth day of the month preceding the Payment Date, whether or not such day is a business day. 3.03. Registration. The Authority hereby appoints the City Chief Financial Officer to perform the functions of registrar, transfer agent and paying agent (the "Registrar"). The effect of registration and the rights and duties of the Authority and the Registrar with respect thereto shall be as follows: (a) Register. The Registrar shall keep at its office a bond register in which the Registrar shall provide for the registration of ownership of the Note and the registration of transfers and exchanges of the Note. (b) Transfer of Note. Upon surrender for transfer of the Note duly endorsed by the registered owner thereof or accompanied by a written instrument of transfer, in form reasonably satisfactory to the Registrar, duly executed by the registered owner thereof or by an attorney duly authorized by the registered owner in writing, the Registrar shall authenticate and deliver, in the name of the designated transferee or transferees, a new Note of a like aggregate principal amount and maturity, as requested by the transferor. Notwithstanding the foregoing, the Note shall not be transferred to any person unless the Authority has been provided with an opinion of counsel or a certificate of the transferor, in a form satisfactory to the Authority, that such transfer is exempt from registration and prospectus delivery requirements of federal and applicable state securities laws. The Registrar may close the books for registration of any transfer after the fifteenth day of the month preceding each Payment Date and until such Payment Date. (c) Cancellation. The Note surrendered upon any transfer shall be promptly cancelled by the Registrar and thereafter disposed of as directed by the Authority. (d) Improper or Unauthorized Transfer. When the Note is presented to the Registrar for transfer, the Registrar may refuse to transfer the same until it is satisfied that the endorsement on such Note or separate instrument of transfer is legally authorized. The Registrar shall incur no liability for its refusal, in good faith, to make transfers which it, in its judgment, deems improper or unauthorized. (e) Persons Deemed Owners. The Authority and the Registrar may treat the person in whose name the Note is at any time registered in the bond register as the absolute owner of the Note, whether the Note shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on such Note and for all other purposes, and all such payments so made to any such registered owner or upon the owner's order shall be valid and effectual to satisfy and discharge the liability of the Authority upon such Note to the extent of the sum or sums so paid. SJB-235566v5 B-5 CL205-20 (f) Taxes, Fees and Charges. For every transfer or exchange of the Note, the Registrar may impose a charge upon the owner thereof sufficient to reimburse the Registrar for any tax, fee, or other governmental charge required to be paid with respect to such transfer or exchange. (g) Mutilated, Lost, Stolen or Destroyed Note. In case any Note shall become mutilated or be lost, stolen, or destroyed, the Registrar shall deliver a new Note of like amount, maturity dates and tenor in exchange and substitution for and upon cancellation of such mutilated Note or in lieu of and in substitution for such Note lost, stolen, or destroyed, upon the payment of the reasonable expenses and charges of the Registrar in connection therewith; and, in the case the Note lost, stolen, or destroyed, upon filing with the Registrar of evidence satisfactory to it that such Note was lost, stolen, or destroyed, and of the ownership thereof, and upon furnishing to the Registrar of an appropriate bond or indemnity in form, substance, and amount satisfactory to it, in which both the Authority and the Registrar shall be named as obligees. The Note so surrendered to the Registrar shall be cancelled by it and evidence of such cancellation shall be given to the Authority. If the mutilated, lost, stolen, or destroyed Note has akeady matured or been called for redemption in accordance with its terms, it shall not be necessary to issue a new Note prior to payment. 3.04. Preparation and Delivery. The Note shall be prepared under the direction of the Executive Director and shall be executed on behalf of the Authority by the signatures of its President and Executive Director. In case any officer whose signature shall appear on the Note shall cease to be such officer before the delivery of the Note, such signature shall nevertheless be valid and sufficient for all purposes, the same as if such officer had remained in office until delivery. When the Note has been so executed, it shall be delivered by the Executive Director to the Owner thereof in accordance with the Agreement. Section 4. Security Provisions. 4.01. Pledge. The Authority hereby pledges to the payment of the principal of and interest on the Note all Housing/Retail Available Tax Increment under the terms and as defined in the Note. Housing/Retail Available Tax Increment shall be applied to payment of the principal of and interest on the Note in accordance with the terms of the form of Note set forth in Section 2 of this resolution. 4.02. Bond Fund. Until the date the Note is no longer outstanding and no principal thereof or interest thereon (to the extent required to be paid pursuant to this resolution) remains unpaid, the Authority shall maintain a separate and special "Bond Fund" to be used for no purpose other than the payment of the principal of and interest on the Note. The Authority irrevocably agrees to appropriate to the Bond Fund in each year all Available Tax Increment. Any Available Tax Increment remaining in the Bond Fund shall be transferred to the Authority's account for the TIF District upon termination of the Note in accordance with its terms. 4.03. Additional Bonds. If the Authority issues any bonds or notes secured by Available Tax Increment, such additional bonds or notes are subordinate to the Note in all respects. SJB-235566v5 B-6 CL205-20 Section 5. Certification of Proceedings. 5.01. Certification of Proceedings. The officers of the Authority are hereby authOrized and directed to prepare and furnish to the Owner of the Note certified copies of all proceedings and records of the Authority, and such other affidavits, certificates, and information as may be required to show the facts relating to the legality and marketability of the Note as the same appear from the books and records under their custody and control or as otherwise known to them, and all such certified copies, certificates, and affidavits, including any heretofore furnished, shall be deemed representations of the Authority as to the facts recited therein. Section 6. Effective Date. This resolution shall be effective upon approval. Adopted this __ day of ,20__. President Executive Director SJB-235566v5 CL205-20 B-7 SCHEDULE C CERTIFICATE OF COMPLETION WHEREAS, the Columbia Heights Economic Development Authority, Columbia Heights, Minnesota, a public body, corporate and politic (the "Grantor"), by a Deed recorded in the Office of the County Recorder or the Registrar of Titles in and for the County of Anoka and State of Minnesota, as Deed Document Number(s) and , respectively, has conveyed to , a Minnesota (the "Grantee"), the following described land in County of Anoka and State of Minnesota, to-wit: (the "Property") and WHEREAS, said Deed contained certain covenants and restrictions set forth in Sections 1 and 2 of said Deed; and WHEREAS, said Grantee has performed said covenants and conditions with respect to the Property insofar as it is able in a manner deemed sufficient by the Grantor to permit the execution and recording of this certification; NOW, THEREFORE, this is to certify that all building construction and other physical improvements specified to be done and made by the Grantee on the Property have been completed and the above covenants and conditions in said Deed and the agreements and covenants in Article IV of the Agreement (as described in said Deed) with respect to the Property have been performed by the Grantee therein, and the County Recorder or the Registrar of Titles in and for the County of Anoka and State of Minnesota is hereby authorized to accept for recording and to record, the filing of this instrument, to be a conclusive determination of the satisfactory termination of the covenants and conditions of Article IV of the Agreement with respect to the Property, Dated: ,20__. COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY By Its President SJB-235566v5 C- 1 CL205-20 By Its Executive Director STATE OF MINNESOTA ) COUNTY OF ANOKA ) On this __ day of , 20__, before me, a Notary Public within and for said County, personally appeared , to me personally known, who, being by me duly sworn, did say that (s)he is the President of the Authority named in the foregoing instrument; that the seal affixed to said instrument is the seal of said Authority; that said instrument was signed and sealed in behalf of said Authority by authority of its governing body; and said acknowledged said instrument to be the flee act and deed of said Authority. Notary Public STATE OF MINNESOTA ) COUNTY OF ANOKA ) On this __ day of ., 20___, before me, a Notary Public within and for said County, personally appeared , to me personally known, who, being by me duly sworn, did say that (s)he is the Executive Director of the Authority named in the foregoing instrument; that the seal affixed to said instrument is the seal of said Authority; that said instrument was signed .and sealed in behalf of said Authority by authority of its governing body; and said acknowledged said instrument to be the free act and deed of said Authority. Notary Public SJB-235566v5 C-2 CL205-20 TO: FROM: DATE: SUB J: EDA Commissioners Robert Streetar, Director of Community Development September 8, 2003 39th and Central Redevelopment Project The purpose of this memorandum is to update EDA Commissioners regarding the redevelopment of the 39th and Central, and to reconfirm the EDA's desire to redevelop this area. In January of 2002, and then again on February 18, 2003, the City Council established redevelopment priorities. These priorities are the: 1. Industrial Park 2. Kmart 3. 37th and Central Avenue 4. 39th and Central Avenue 5. 37th and Stinson Boulevard (northwest corner) 6. 40th and University Avenue (southeast corner) 7. NEI 8. 40th and Tyler Street 9. South Lomianki Please note that staff is currently working on the Industrial Park, Kmart, 37th and Central, and 40th and University. On August 22, 2003, the City received a letter from Gene Mady and Doug Foss, the owners and operators of the building located at 3927 Central Avenue. Please see the attached letter. Essentially, they are requesting that the City remove their property from any redevelopment plan. In response, the Mayor responded with a letter indicating that the redevelopment of 39th and Central, including their property remains a high priority for the City. Please see attached letter. Staff strongly recommends that the 39th and Central area, including the building in question, remain a high priority for redevelopment. It is very likely that the EDA may have to acquire this property through eminent domain, if the owners are unwilling to negotiate a fair price. Staff requests Commissioner's direction on the following question. If required, are the Commissioners willing to exercise the power of eminent domain to acquire this and any other property for the purpose of redevelopment? MADY- FOSS PARTNERSHIP 3919 Central Ave. NT Columbia Heights, Mn. 55421 August 22, 2003 City of Columbia Heights Council Members: Mayor Juhenne Wyckoff Robert Williams Bruce Nawrocki Tammera Ericson Bruce Kelzenberg Dear Mayor Wyckoff, While preparing to replace our parking lot for our business located at 3927 Central Ave. NE in Columbia Heights, I contacted the city d..ev_e.!ppe~. Streetec During th/s conversation he made reference t~ our property being ilatect for re-development. We respectfully request that you remove our name from the redevelopment list, as we do not have any intention to sell since we have long range plans for this property. We init/ally had planned to resurface the parking lot, however these plans were postponed due to the City's Central Avenue project. Now that the City's project is finished, our parking lot project is scheduled to begin September 2, 2003. This w/Il greatly/reprove the image ofth/s property. We pay over $16,000.00 annually in property taxes. Additionally, the three businesses within this property provide jobs to over 25 people. We pride ourselves on having reputable businesses on this property. Salvation Army is an international, charitable organization that has provided a reputable and much needed service for over seven years in Columbia Heights. Additionally, Mady's Bowl has provided family entertairment for over years. Lastly, Mattress Outlet provides quality furniture and bedding at a great value for this community. In conclusion, we feel that allowing us to continue with our businesses would be in the best interest of this city. We greatly appreciate your support in allowing our families to continue in serving this community. Please respond regarding your position in this important matter. We, Gene and Doug, also request to be notified via mail of any meetings held concerning this property. Thank you kindly, GeneMady / ~ Owner-Operator 10001 Grouse St NW Coon Rapids, Mn. 55448 (763) 754-1120 - Home Owner-Operator 5530 Old Viking Blvd NW Anoka, Mn. 55303 (763) 755-2721 - Home (612) 532-9248 - Cell CC; Mayor Julierme Wyckoff Robert Williams Brace Nawrocki Tammera Ericson Bruce Kelzenberg CITY OF COLUMBIA HEIGHTS 590 40th Avenue N.E.. Columbia Heights. MN 55421-3878 (763) 706-3600 TDD (763) 706-3692 Visit Our Website at: www. ci. colutnbia-heights, mn.us ADMINISTRATION Mayor: Julienne Wyckoff Councilmembers: Robert A. Williams Bruce Nawrocki Tammera Ericson Bruce Kelzenberg Ci~' Manager: Walter R. Fehst August 28, 2003 Gene Mady 10001 Grouse St. NW Coon Rapids, MN 55448 Doug Foss 5530 Old Viking Blvd NW Anoka, MN 55303 Thank you so much for your letter regarding the City's ongoing redevelopment efforts for Central Avenue. As you know, the City has prioritized certain blocks within its central business district, as well as certain blocks in the northern section of Central Avenue (i.e. Kmart redevelopment). The development potential of the block including your property is significant. The City has discussed this block (including the Burger King property) with potential developers over the past several years. Though nothing concrete has developed, the City Council continues to seek redevelopment of its Central Business District as a very high priority. I have attached a copy of a recent article from the May 12, 2003 issue of the Minnesota Real Estate Journal citing the City's recent efforts throughout the City. Obviously, we look to work with all the affected property owners in any future redevelopment proposals. Bob Streetar, our Community Development Director or Walt Fehst, our City Manager can be contacted to set up a meeting with you, should you wish any further information. I can also be reached by contacting City Hall at (763) 706-3610. Sincerely, ( ) Julienne Wyckoff Mayor cc: City Councilmembers Walt Fehst, City Manager Bob Streetar, Com. Dev. Director THE CITY Of COLUMBIA HEIGHTS DOES NOT DISCRIMINATE ON THE BASIS OF' DISABILITY IN EMPLOYMENT OR THE PROVISION Of SERVICES EQUAL OPPORTUNITY EMPLOYER TO: EDA Commissioners FROM: Robert Streetar, Director of Community Development DATE: 10 September 2003 SUB J: Potential development proposal for the NEI site. This memorandum provides an overview of a potential redevelopment concept for the NEI site. A site plan and examples of the housing is attached. Background On June 1, 2003, the Dunwoody College of Technology merged with NEI College of Technology. The terms of the merger call for Dunwoody to assume ownership of all NEI assets, including its facility in Columbia Heights. It is Dunwoody's intent to sell the building, but in any event, the building will closed in December of 2003. For the last few months, NEI has worked with a real estate broker to find a potential user for the existing building, or a developer to redevelop the entire property. According the Mr. Bill Tobin, the broker, while he has contacted a number of potential users, none of them expressed an interest in reusing the building, sighting the tremendous cost of rehabilitating building systems. In addition, City staff presented this opportunity to United Properties, Inc., Welsh Companies, Inc., Schaffer Richardson, Inc., and the Cornerstone Group, Inc. All indicated the reuse of the building is not feasible, and that redevelopment is the only feasible option. On September 8, 2003, representatives of NEI presented to City staff a possible redevelopment concept for the site. Redevelopment Concept The concept has two primary components. examples of the housing. Please find attached a site plan and Component 1 - City Hall / Library and Senior Rental Housing Component 1 includes a building located on 41st Avenue that consists of city hall and library on the first floor, and three stories (60 units) of moderately priced senior rental housing on the second, third and fourth floors. A second option would result in all senior housing without a city hall or library. The Anoka County Housing and Redevelopment Authority (HRA) would own and manage the senior rental housing. The City would own its facilities on the first floor. This concept of a city hall on the first floor with senior housing on floors above is nearing completion in the City of Waconia. In addition, County Commissioner Kordiak expressed a desire by the County to explore joint library options at this location. Component 2 - Market Rate Townhomes Component 2 includes 20 units of market rate, single-story, townhomes. for-sale, side-by-side This project may require the City's financial assistance to demolish the existing building. While the NEI Board of Directors has not officially endorsed this concept, the Anoka County HRA has expressed a strong interest in moving forward with this project. Staff believes this is a great opportunity, in terms of the proposed uses and timing, to seriously explore further this redevelopment opportunity. Staff requests the Commissioners direct staff to: · Further, explore this concept, and report at the October EDA meeting; and · Notify NEI of the City's intent to do so. Frank Dunbar, the developer, Mr. Bill Tobin, the real estate broker, will be present at the September 16, 2003 meeting to answer questions. 2 IIIi iiii ii[i Ii[i Iiii il!i i!i! iiii ii!i iiii Iiii iiii Z -r- Z L~ Z --J 0 .! TO: EDA and HRA Commissioners FROM: Robert Streetar, Community Development Director DATE: August 15, 2003 SUBJECT: Community Development Monthly Update The purpose of this monthly report is to provide EDA and HRA Commissioners with a comprehensive update on the City's community development goals and activities. 4833 University Avenue Staff has been negotiating the sale of 4833 University Avenue with the adjacent property owner, Collins Autobody. Collins is interested in acquiring the property for the proposed expansion of their business. Their last offer of $65,000 was $10,000 under the City's purchase price. At it's last meeting the EDA suggested a mid-point compromise price of $70,000 with Collins Autobody being responsible for the demolition of the blighted, single-family home. Mr. Collins has agreed to the $70,000 purchase price but is in the process of working with the SBA on his financing and would like a 24- month window for construction rather than the original 12 months. Staff recommends moving forward with the sale. Industrial Park Redevelopment Plan The soil and water testing at the Industrial Park has been completed. Of the 85 samples taken, three locations showed significant contamination products being present. Monitoring wells are being installed at these sites based on MPCA standards for longer-term analysis. Information obtained from these samples will make up the basis of the Response Action Plan. Funding from Department of Energy and Economic Development (DEED) for these corrections will be applied for next month. A complete analysis of all testing in the park will be available in two weeks. In addition, the Columbia Heights City Council approved a grant application to the Metropolitan Council for a one-time predevelopment grant for funding infrastructure in the Industrial Park. The purpose of this engineering study will address the needs of sewer, water, surface water management, traffic, road improvements, and an estimated cost of all improvements needed before redevelopment. 0 fl. ~ :~ ~' U,. ILl LU Z O) n~ 0 0 LO w z U. ~ LI. LU 0 2: U,I 2: LU ~ Summit on Civic Leadership American communities are faced with an unprecedented set of challenges in the Post 9-11 era and this period of entrenched budget deficits. At the same time, the face of local leadership continues to change, and many would argue that the old systems for leadership recruitment and development are no longer effective. Consequently, traditional training grounds no longer provide the steady and predictable supply of community leaders. New leaders are drawn from increasingly broader sources. Many arrive on the scene with significantly less experience and they join colleagues, who also tend to have shorter tenures than in the past. Both of these factors combine to impede the ability to make wise decisions for the long-term common good of communities. This program will provide participants an opportunity to ask in-depth questions, before and during the program, and engage the speakers and audience in a spirited discussion about this timely and important topic. WILLIAM H. HUDNUT III, Senior Resident Fellow with the Urban Land Institute, former member of Congress, four-term Mayor of Indianapolis, author, TV commentator and clergyman CHRISTOPHER GATES, President of the National Civic League, a 109-year old non-profit, non-partisan organization dedicated to strengthening citizen democracy by transforming democratic institutions. "Bill's recent book, Halfway to Everywhere: A Portrait of America's First Tier Suburbs, addresses important development issues for Minnesota policymakers and developers. Bill is just the right person to bring ULI's education and research perspective to the topic of civic leadership and public policy." -- Bob Engstrom, local builder/developer "Mr. Gates gave an exceptional opening keynote address at the League of Minnesota Cities conference in St. Cloud in June, and the discussion follow-up sessions generated very enthusiastic and positive comments from the elected and appointed officials that were in attendance." -Terry Schneider, Council member, City of Minnetonka This event is co-sponsored by: Association of Metropolitan Municipalities Briggs & Morgan Builders Association of the Twin Cities Dorsey & Whitney Economic Development Association of MN Kennedy & Graven North Metro Area Mayors Association MN Chapter-APA League of Minnesota Cities Additional sponsorship opportunities available, including limited spaces for private dinner with speakers on 9123/03. Please call 952-474-2177 for info. After the program, Mr. Hudnut will available to sign his new book, Halfway to Eve _rywhere: A Portrait of America's First Tier Suburbs,. The book will be for sale at the program for $29.95. Registration Fees: Q All registrants $45 Registration Deadline: Friday, September 19, 4:00 p.m. Confirmations will be emailed. Sorry, fax, checks and P.O.'s received after the registration deadline will not be included in meeting registry or guaranteed a prepared name badge. Refund requests must be submitted in writing no later than the date of the registration deadline; refund requests will not be accepted after this date. Fax request to: 202-624-7147. Program Date/Location: Wednesday, September 24, 7:30-11:30 a.m. DoubleTree Park Place, 1500 Park Place Boulevard, St. Louis Park ULI Minnesota Summit on Civic Leadership [8117-0402] Payment Methods: (Please check the box indicating your method of payment) CI CREDIT CARD: ri FAX: 1- 800-248-4585 - Fax Credit Card information with completed registration form. ri Indicate credit card: [3 Visa [3 Mastercard [3 AMEX [3 Diners Club [~ Discover [3 Carte Blanche Card Number: Exp. Date: Signature · CI CHECK: Iq CALL: '1- 800 - 32'1- 50~1'1 - Telephone pre-registration is required to ensure inclusion in the meeting registry of attendees and to obtain a prepared name badge. Make Checks Payable to: ULI/Minnesota District Council Mail check with completed registration form to: ULI - the Urban Land Institute Minnesota District Council, Department 304 Washington, DC 20055-0304 [3 PURCHASE ORDER: (Public Agencies Only) ri FAX: 1.800-248-4585 - Fax copy of signed P.O. and completed registration form to ensure inclusion in meeting registry of attendees and to obtain a prepared name badge. ri Payment to follow by check payable to: ULII Minnesota District Council r] Mail check with Purchase Order and original registration form to: ULI - the Urban Land Institute Minnesota District Council, Department 304 Washington, DC 20055-0304 REGISTRATION FORM: IMPORTANT: The following information must be completed: ULI Member ID # Name Informal Name for Badge. Title Company Address City/State/Zip Telephone Fax E-Mail* (8117-040) * Email is required in order to receive a confirmation*--For multiple registrations, please duplicate this form. Parkview Villa Housing Complex 965 N.E. 40th Avenue, Columbia Heights, MN 55421 (763) 706-3800 Fax (763)788-3978 DATE: TO: FROM: RE: September 1, 2003 Robert Streetar; Community Development Director Shirley Barnes; Chief Executive Officer; Crest View Corporation Commissioners; Columbia Heights HRA Board of Directors; Crest View William Jones, Housing Administrator August Management Report for Parkview Villa & 4607 Tyler The HUD scores for Parkview Villa North are posted in NASS. We received a 95. The highest score Parkview has ever received. MGS completed the caulking on August 15, 2003. LBP will be out on August 27,2003 to complete the work on the rooftop units. OCCUPANCY: 4607 Tyler 4 Move out date August 1, 2003 All Units Rented NORTH BUILDING 704 Move out date September 1,2003 SOUTH BUILDING 322 Move out August 31,2003 Waiting list totals are as follows: Parkview Villa North 20 CH Residents 39 Non-residents 4607 Tyler 4 CH Residents 9 Non-residents Parkview Villa South 24 CH Resident 16 Non residents Equal Housing Opportunity Agency Owned by the City of Columbia Heights HRA Managed by Crest View Management Services EQUAL #OUSINe OPPORTUNITY PI;lAS Resident Report Page 1 of 1 integrated assessment subsystem (nass REAL ESTATE A,~.~FIENT CENTER LLS. C)EPARTMENT OF HOUSING ANO URBAN IDL:VELOPt4ENT Cdiviflual reports PHAS Resident Report for Fiscal Year 2002 August PHA Information Ip.,~o~.: I.,,o~ IP"*"m'= I'~O~O~"~'*HEIGHTS I FEi2~..al Year 112/31I Resident Score (rounded) 9 Resident Sub-Indicators Actual Score Maximum Score ! Survey Results 4.3 S.0 Maintenance and Reoalr 0.9 1.0 Communicatl0n 0.8 1.0 Safety O.8 ]..0 Services 1.0 1.0 Aooearance 0.9 1.0 2 Implementation Plan 2.0 2.0 3 Follow-Up Plan 3.0 3.0 Total Resident Score: 9.3 10.0 Last U ~dated: 06/02/2003 The sum of the sub-indicator scores may not equal the overall Indicator score due to rounding. Comments or Questions? Contact the REAC Technical Assistance Center. [1-888-245-4860[ https://hudapps.hud.gov/HUD_Systems/nass/n_PHAS_Resident_Report.c fm?fiscal_year=... 8/25/2003 *' PI~_S Management Report Page 1 of 2 ~integr~ ated assessment subsystem~(nass REAL rr~rATE A,~S~:SFt~ CENTER U.S. DEPARTMENT OF HOUSING ANO URBAN DEVELOPMENT ..................................... Cdividual reports~ PHAS Management Report for Fiscal Year 2002 August PHA Xnformatlon Management Score 27 (rounded) Management Sub-Indicator[2] Actual Score Maximum Score I Vacant Unit Turnaround Time 2.61 5.22 2 Capital Fund 9.13 9.13 I Unexpended Funds Over Thr~e Federal Fiscal Years (FFYs) Old Excluded Excluded Timeliness of Fund Obligation Excluded Excluded Adequacy of Contract Administration 2.28 2.28 Quality of the Physical Work 4,57 4.57 Adequacy of Budget Controls 2.28 2.28 3 Work Orders 5.22 5.22 Emergency Work Orders Excluded Excluded Non-Emergency Work Orders 5.22 5.22 4 Annual Inspection of Dwelling Units and Systems 5,22 5.22 Annual Inspection of Owelllng Units 2.61 2.61 Annual Inspection of Systems Including Common Areas and Non- Dwelling Space 2,61 2.61 5 Security 5.22 5,22 Tracking and Reporting Crime-Related Problems 1.74 1.74 Screening of Applicants 1.74 1,74 Lease Enforcement 1.74 1.74 Drug Prevention and/or Crime Reduction Program Goals Excluded Excluded 6 Economic Self-Sufficiency Excluded Excluded Total Management Score 27.4 30.0 Last Updated: 05/30/2003 (2)"Excluded" will be displayed in both the Actual Score and Maximum Score columns when the PHA does not use the opUonal sub-Indicators/components. The points will be reallocated to other sub-indicators/components by way of renormalization. The sum of the sub-indicator scores may not equal the overall indicator score due to rounding. Comments or Questions? Contact the REAC Technical Assistance Center. 11-888-245-48601 https://hudapps.hud.gov/HUD ....Systems/nass/n PHAS Management Report.cfmgfiscal_ye. ... 8/25/2003 ~;omposite Score Report Page 1 of 1 inte ted assessmen subsystem (nass) REAL ESTATE A.~ES~ENT CENTER LLS. I::~RaJLq'MENT OF HOUSING AND URBAN DEVELOPMENT Cdividual report? PHAS Score Report for Fiscal Year 1998 August PHAS First Year Advisory Scores 09/30/98 - 06/30/99 These scores were calculated using 1998 Physical Inspection Scoring Criteria, Non-GAAP Financial Data, PHMAP Management Operations Information and the maximum available points for the Resident Satisfactory Survey. PHA Information PHAS 83 Designation "' Score: Status: Advisory J Fiscal Year J J HRA OF COLUMBIA HEIGHTS J End: 12/31 PHAS Released Status: Select a PHAS Indicator to view details relating to the composite score. PHAS Indicator Origlnal Score Physical 14 Financial 29 Management 30 Resident 10 Maximum Score 3O 30 3O 10 PHAS Total Score 83 100 Last Updated: 12/31/1998 PHAS Score Report The sum of the indicators as displayed may not equal the composite PHAS score shown due to rounding. ~,~Download Acrobat Reader Comments or Questions? Contact the REAC Technical Assistance Center. I 1-888-245-48601 https://hudapps.hud.gov/HUD_Systems/nass/n_Composite_Score.c fm?pha_id=MN 105 &p... 8/25/2003 'Co.mposite Score Report Page 1 of 1 integrated assessment subsystem (n h~rn~ REAL F. STATE ASSES~ENT CENTER U.S. DEPARTMENT OF HOUSING AND URBAN DEVI~LOPflENT qndividualreports PHAS Score Report for Fiscal Year 1999 m~nu August PHA %nformation PHAS 86 Designation Score: Status: PHAS Advisory Status: Released Select a PHAS Indicator to view details relating to the corn )oslte score. PHAS %ndicator Original Score Maximum Score %ndicator/PHAS Explanation Phy$1qal 26' . 30 Explanation Financial 28 30 Explanation Manaoement 23 30 Explanation Resident 9 10 Explanation PHAS Total Score 86 %00 Last Updated: 2%/22/2000 Check Hanaoement Assessment Score PHA$ Score Reoort The sum of the indicators as displayed may not equal the composite PHAS score shown due to rounding. '~Download Acrobat Reader Comments or Questions? Contact the REAC Technical Assistance Center. ll-888-245-48601 https://hudapps.hud.gov/HUD_Systems/nass/n_Composite_Score.c fm?pha_id=MN 105&p... 8/25/2003 iZ~omposite Score Report Page 1 of 1 integrated assessment subsystem (nass)-, ,-~ home REAL ESTATE AS~.SS~ENT CENTER U.~ C~PARTHENT OF HOUSING ANO URBAN OEYELOI~IENT itfindividual reports PHAS Score Report for Fiscal Year 2000 August PHA Information IPHA Code: I MNIOS I PHA Name: PHAS 77 Designation Score: Status: Advisory PHAS Status: Released Select a PHAS Indicator to view details relating to the com mslte score. PHAS Indicator Original Score Maximum Score Indicator/PHAS Explanation Physical 26 ' 30 Exolanation Financial 22 30 Explanation Manaoement 22 30 Explanation Resident 7 10 ExPlanation PHAS Total Score 77 100 Check Hanaaement Assessment Score PHAS Score Reoort PHAS Scoring Packet ~prlntable version) Last Updated: 10/02/2001 The sum of the indicators as displayed may not equal the composite PHAS score shown due to rounding. ~"~Oownload Acrobat Reader Comments or Questions? Contact the REAC Technical Assl$1;ance Center. 11-888-245-48601 https://hudapps.hud.gov/HUD_Systems/nass/n_Composite_Score.cfm?pha_id=MN 105&p... 8/25/2003 'Co,m. posite Score Report Page 1 of 1 i~tegrated assessment subsystem (nass)" ~ REAL F. STAT£ ASSESe~'IENT CENTER U.S. OEPARTMENT OF HOUSING AND URBAN DEVELOI~IENT iifi n di vi d ua I rep orrs~ PHAS Score Report for Fiscal Year 200:L teac home ~ system5 n'~enu August PHA Xnformation PHAS 94 Designation Score: Status: High Performer PHAS Status: Released ~elect a PHAS indicator to view details relating to the corn )oslte score. PHAS Zndicator Original Score Maximum Score ~ndicator/PHAS · Explanation Physical 29 30 Exolanation Financial 28 30 Explanation Manaoement 28 30 Explanation Resident 9 l0 Explanation PHAS Total Score 94 :LO0 PHAS Score Repc~rt PHAS Scorina Packet (printable version) Last Updated: 10/15/2002 The sum of the Indicators as displayed may not equal the composite PHAS score shown due to rounding. Download Acrobat Reader Comments or Questions? Contact the REAC Technical ASSistance Center. 11-888-245-48601 https://hudapps.hud.gov/HUD_Systems/nass/n_Composite_Score.c fm?pha_id=MN 105 &p... 8/25/2003 · 'Composite Score Report · integrated assessment subsystem (nass)'%.-._.~=c ~o.~ R~L ESTATE ~E~ ~NTr~. PHAS Score Report for Fiscal Year 2002 Page 1 of 1 menu August PHA ~[nformation PHAS 95 Designation Score: Status: PHAS High Performer Status: Released Select a PHAS Indicator to view details relating to the corn ~osite score. PHAS Indicator Original Score Maximum Score Indicator/PHAS ,, Explanation Physical 29 30 Exolanation Financial 30 30 Explanation Hanaaement 27 30 Explanation Resident 9 10 Explanatioq PHAS Total Score 9S 1.00 PHAS Score Reoort PHAS S¢orina Packet (orintable version) Last Updated: 06/02/2003 The sum of the indicators as displayed may not equal the composite PHAS score shown due to rounding. °~'[Download Acrobal; Reader Comments or Questions? Contact the REAC Technical Assistance Center. !1-888-245-48601 9 T https://hudapps.hud.gov/HUD_Systems/nass/n_Composite_Score.cfm.pha_id=MN 105&p... 8/25/2003 RESIDENT COUNCIL NEWS The next Resident Council meeting will be Monday, September 8, 2003 at 7:00pm in Community Room. Pet Policy The City of Columbia Heights requires all dogs and cats over 6 months old to be licensed~. SMOKING Please remember there is no smoking in the common areas of this building. Also please remind all of your visitors &this rule. Maintenance Issues If you have a maintenance issue after 5:00 p.m. you must call 763-706-3800 thank you. LAUNDRY ROOM GUIDELINES Please be sure to clean both the washers and dryers when you are done using them. Don't leave a mess for the ne>tt person. COMMON AREA GUIDELINES Absolutely, no alcoholic beverages in the common areas. Be sure that your visitors are aware of this. PHASS SCORE PHAS Score for 2002 has been posted in (NASS). Parkview Villa Score was a 95. The highest ever. I will post the score on the bulletin board by the main entry way. OUTREACH CORN Eli By Nancy Shaw, Sr. Outreach Coordinator for Columbia Heights and Hilltop Greetings to everyone. I am officially back as of August 25, 2003. I would like to take this opportunity to introduce myself to new arrivals in the building and say hi to established residents. I am Nancy Shaw the Senior Outreach Worker for the Columbia Heights and Hilltop areas of Anoka County. I can assist residents with a variety of concerns, everything from. assistance to help with finding local ' resources to help in your everyday life. I am in the building the second Wednesday of each month from 9:30 a.m. to noon. You may stop down with questions, or call me anytime at my office at 763-783-4741. I receive messages at the end of each day and try to return that call within 24 hours. I can come to your home and we can look at community programs that might serve you. I look forward to seeing everyone again, and please do not hesitate to call me at anytime. RESIDENT COUNCIL MEETING MINUTES OF SEPTEMBER 8, 2003 The meeting was called to order at 7:00 p.m. by President, Dennis Ecklund Jr. The Pledge of Allegiance was said. William arrived to get the microphone from the office. Management Report by William Jones. · The work on the exhaust vents is in progress. The Secretary and Treasurers reports were given. Welcome Committee report by Clyde Rawls- new residents in attendance were introduced. Apartments 704, 802, 706 and 911 are empty now and new people shall be welcomed by Clyde as they move in. Entertainment Report- Pricilla Cross announced an Apple Orchard tour set for October 8th, rFC dinner in November, December 13th Christmas Dinner, and a Knights of Columbia Concert on December 16th. Bazaar Committee head Dorothy Schaffer, gave information on upcoming Bazaar to be held on September 20th. Set up for the Bake Sale, White Elephant, Quilt and Crafts to be Friday afternoon the 19th. Nametags issued to all helpers. Menu: Chicken, Macaroni Salad, Bun, Chips, Pickles all for $4.00. Old Business- None New Business- · Residents urged to use buddy system · Someone used magic markers on new tables. They have been cleaned and put back. People are urged to report incidents to office. · The door buzzer system is broken down. Guests aren't able to call through to residents. Hopefully, this will be repaired shortly. The drawings for $5.00 gifts were held. Meeting Adjourned at 8:00 p.m. Respectfully Submitted, Pat Jindra EDA Representative