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HomeMy WebLinkAbout20180205_EDA_MinutesECONOMIC DEVELOPMENT AUTHORITY (EDA) MINUTES OF THE MEETING OF FEBRUARY 5, 2018 The meeting was called to order at 6:30 pm by Executive Director, Walt Fehst. Members Present: Murzyn, Schmitt, Buesgens, Williams, Novitsky, and Szurek Members Absent: Herringer Staff Present: Walt Fehst, Keith Dahl, JosephHogeboom, and Shelley Hanson PLEDGE OF ALLEGIANCE - RECITED OATH OF OFFICE - Marlaine Szurek was sworn in for her new term. ELECTION OF OFFICERS- Williams nominated Szurek for President. Schmitt then asked if a motion could be made to keep the same officers as last year. There were no objections to that so the following motion was made. Motion by Williams, seconded by Murzyn, to elect Marlaine Szurek as President of the Economic Development Authority; to elect Donna Schmitt as Vice - President of the Economic Development Authority; to elect Bobby Williams as Treasurer of the Economic Development Authority; and to appoint Keith Dahl as Secretary of the Economic Development Authority; to appoint Shelley Hanson as the Asst Secretary of the Economic Development Authority; and to appoint Joseph Kloiber as Asst Treasurer of the Economic Development Authority. Roll Call: All ayes. MOTIONPASSED. President Szurek then took over leadership of the meeting. CONSENT AGENDA 1. Approve minutes of December 4, 2017 2. Approve Financial Report & Payment of Bills for November and December, 2017 — Resolution 2018 -01 Questions from Members: There were no questions from members. EDA Minutes Page 2 Feb 5, 2018 Motion by Buesgens, seconded by Murzyn, to approve the Minutes of December 4, 2017, and the Financial Report and payment of Bills for November^ and December, 2017 as presented. All ayes. MOTIONPASSED. RESOLUTION NO. 2018-01 A Resolution of the Economic Development Authority of Columbia Heights, Minnesota, Approving the Financial Statements for the Months of November and December 2017 and the Payment of the Bills for the Months of November and December, 2017. 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 months of November and December 2017 has been reviewed by the EDA Commission; and WHEREAS, the EDA has examined the financial statements and fords them to be acceptable as to both form and accuracy; and WHEREAS, the EDA Commission has other means to verify the intent of Section 469.096, Subd. 9, including but not limited to Comprehensive Annual Financial Reports, Annual City approved Budgets, Audits and similar documentation; and WHEREAS, financials statements are held by the City's Finance Department in a method outlined by the State of Minnesota's Records Retention Schedule, NOW, THEREFORE BE IT RESOLVED by the Board of Commissioners of the Columbia Heights Economic Development Authority that it has examined the referenced financial statements including the check history, and they are found to be correct, as to form and content; and BE IT FURTHER RESOLVED the financial statements are acknowledged and received and the check history as presented in writing is approved for payment out of proper funds; and BE IT FURTHER RESOLVED this resolution is made a part of the permanent records of the Columbia Heights Economic Development Authority. ORDER OF ECONOMIC DEVELOPMENT AUTHORITY Passed this 5th day of February , 2018 Offered by: Buesgens Seconded by: Murzyn Roll Call: All ayes EDA Minutes Page 3 Feb 5, 2018 BUSINESS ITEMS 1. Ratification of the Purchase Agreement for 4827 University Ave - Resolution 2018 -02 Dahl reminded members that on July 10, 2017, the Columbia Heights Economic Development Authority (the "EDA ") approved Resolution 2017 -18, a resolution which effectively entered the EDA into a Broker Representation Agreement with RE /MAX Synergy. Furthermore, the resolution authorized RE /MAX Synergy and staff to respond to active listings within the City of Columbia Heights (the "City "), and to make fair market value offers of up to $200,000 on properties identified as nonconforming under the current zoning code of the City. If these offers, in the form of a Purchase Agreement, are accepted by a seller, they are subject to ratification by the EDA prior to acquisition of the property. Dahl said that on November 28, 2017, Brian and Sheri Ternes, property owners of 4827 University Avenue NE (the "Subject Property ") contacted staff to determine if the EDA would be interested in purchasing it. Since the Subject Property is nonconforming under current zoning code of the City and because it is located directly adjacent to 4833 University Avenue NE, a property owned by the City, staff worked with RE /MAX Synergy to place an offer on the Subject Property in the amount of $117,000. Brian and Sheri Ternes countered with an offer of $125,000, and after much negotiation agreed upon a sale price of $121,000. Thus, in order to acquire the Subject Property, the EDA is required to review and consider the ratification of said Purchase Agreement, and the Planning and Zoning Commission will also be required to review the proposed acquisition to determine if it conforms to the Comprehensive Plan of the City. Please note: During the title commitment process, and the title examiner's review of the Subject Property, an issue was identified with the deed of conveyance from the previous property owners to Brian and Sheri Ternes. The previous property owners, John and Corrine Ternes filed their deed as tenants in common instead of joint tenants. Since Corrine Ternes passed away before John Ternes conveyed the property to Brian and Sheri Ternes, her interest in the property still remains since the original deed was filed as tenants in common. Brian and Sheri Ternes have agreed to pay for the quiet probate to convey the interest of Corrine Ternes to them so that there is a clean and clear title. This however, may take three months, but to show good faith, staff recommends ratifying the Purchase Agreement, but not closing on the Subject Property until such time that a clear and clean title is obtain. This may require an amendment to extend the date of closing, but that will be addressed at the March EDA meeting if applicable. Staff recommends approval of Resolution 2018 -02 as presented. Questions from members: Williams asked what the plans were for the parcel if we obtain it. Dahl said it would be combined with the parcel to the north that we already own. Both parcels are zoned for commercial use and this would create of lot that has 120 frontage feet versus the 55 foot parcel that is currently owned by the City. Schmitt asked whether we should be approving the purchase now since there are still title issues that must go through Probate Court. EDA Minutes Page 4 Fe 5, 2018 Dahl said that we won't close on the property until such time that the title issues are cleared and that we can still back out of the deal between now and closing if something arises. Szurek asked about other family members that may come forward to put a claim on the property or that would want the terms re- negotiated. Dahl said it is his understanding the other family members recognize Brian and Sheri have full ownership and rights to the property, but if something changes in this regard then the City can change its decision. Motion by Schmitt, seconded by Buesgens, to waive the reading of Resolution 2018 -02, there being ample copies available to thepublic. All ayes. MOTIONPASSED. Motion by Schmitt, seconded by Novitsky, to adopt Resolution 2018 -02, a resolution ratifying the purchase agreement between the Columbia Heights Economic Development Authority and Brian and Sheri Ternes. All ayes. MOTION PASSED. Buesgens asked if there is a way to ensure this property is kept as commercial and would be sold in the future to a tax paying entity since we have so little commercial left in our city. It was noted that Columbia Heights only has about 5% of its properties used as commercial or industrial. Schmitt noted the City has set precedence in the past of allowing commercial properties to be sold to churches, which then become tax exempt. Fehst said this can be difficult to control and that other cities have been sued when preventing sales to specific groups /uses. Dahl said staff is working on a Zoning Amendment that would create a specific district and criteria for religious establishments. Hogeboom stated that the Land Use map is being re -done for the new Comprehensive Plan that will depict the new Zoning District for Institutional use. This may grant the City more control when they have to approve a new use for a particular property. RESOLUTION NO. 2018 -02 RESOLUTION RATIFYING PURCHASE AGREEMENT BETWEEN THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY AND BRIAN AND SHERI TERNES. BE IT RESOLVED BY the Board of Commissioners ( "Board ") of the Columbia Heights Economic Development Authority (the "Authority ") as follows: SECTION 1. RECITALS. 1.01. The Authority and Brian and Sheri Ternes (together, the "Seller ") have entered into a purchase agreement (the "Purchase Agreement ") pursuant to which the Authority will acquire certain property in the City of Columbia Heights (the "City ") located at 4827 University Avenue NE (the "Property ") from the Seller for economic redevelopment purposes. The Property is described in Exhibit A attached hereto. 1.02. Pursuant to the Purchase Agreement, the Authority will purchase the Property from the Seller for a purchase price of $121,000 plus related closing costs. 1.03. The Authority finds that acquisition of the Property will result in redevelopment of a nonconforming property, and that such acquisition will facilitate the economic redevelopment and revitalization of this area of the City. EDA Minutes Page 5 Feb 5, 2018 1.04. The Planning and Zoning Commission of the City will review the proposed acquisition of the Property at its regular meeting on February 7, 2018, and the Authority expects that the Planning and Zoning Commission will find that the proposed acquisition conforms to the City's comprehensive plan. SECTION 2. PURCHASE AGREEMENT APPROVED. 2.01. The Authority hereby ratifies and approves the actions of Authority staff and of Re /Max Synergy acting as the Authority's real estate broker (`Broker ") in researching the Property and preparing and presenting the Purchase Agreement. The Authority approves the Purchase Agreement in the form presented to the Authority and on file at City Hall, subject to the Planning and Zoning Commission's finding that the acquisition of the Property by the Authority conforms to the comprehensive plan of the City, and 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 Purchase Agreement by those officials shall be conclusive evidence of their approval. 2.02. Authority staff and officials are authorized to take all actions necessary to perform the Authority's obligations under the Purchase Agreement as a whole, including without limitation execution of any documents to which the Authority is a party referenced in or attached to the Purchase Agreement, and any deed or other documents necessary to acquire the Property from the Seller, all as described in the Purchase Agreement. ORDER OF ECONOMIC DEVELOPMENT AUTHORITY Passed this 5th day of February, 2018 Offered by: Schmitt Seconded by: Novitsky Roll Call: All ayes President Attest: Assistant Secretary 2. Final Sale Approval of 4641 Tyler St- Resolution 2018 -03 Dahl explained that on November 6, 2017, the Columbia Heights Economic Development Authority (the "EDA ") approved the concept application submitted by Tollberg Homes for the construction of a single family home on the property located at 4641 Tyler Street NE (the "Subject Property "). The Subject Property is part of the Single Family Home Lot Sales Program (the "Program "), which was established in 2015 to stabilize and increase property values throughout the City of Columbia Heights (the "City "), but more specifically within the Heritage Heights Neighborhood. Lot prices for every property within the Program are based upon the most recent Estimated Market Land Value assessed by Anoka County. However, the EDA has reserved the right to review and adjust lot prices periodically provided that sufficient evidence supports the price reduction of the lot. EDA Minutes Page 6 Feb 5, 2018 The Subject Property was assessed by Anoka County to have a 2018 estimated market land value of $38,600. However, after staff reached out to various local real estate agents, it was determine that the market value of the Subject Property still remains lower than the estimated market land value, but it has drastically increased since the construction of several new single family homes in the Heritage Heights Neighborhood. Therefore, staff estimates that the Subject Property would have a market value between $4.00 to $4.50 per square foot or approximately $29,620 to $33,320 based on the square footage of the lot. Dahl reported that earlier this year, the Public Works Department confirmed that there was a water main break at the Subject Property. This resulted in the sewer and water lines being disconnected at the main underneath the public right -of -way in the street. In order for a single- family home to be constructed on the Subject Property, sewer and water connection to the main will be required, and it will cost approximately $4,000. Thus, based on the market value of the Subject Property and the additional costs that will be incurred to connect sewer and water lines, staff estimates that a reasonable offer price for this particular property would be between $25,620 and $29,320. And, that Tollberg Home's offer of $27,500 is about what the EDA could except to sell the Subject Property for. Attached for review by EDA commission members is the Purchase and Redevelopment Agreement for the sale of the Subject Property, specifically the house plan for the Subject Property. The specific house plan may be found in the Purchase and Redevelopment Agreement attached hereto in Exhibit B. Also, it should be noted that staff received the earnest money in the amount of $2,000 and a partially executed Purchase and Redevelopment Agreement. If the EDA approves the final sale tonight, the earnest money will become non - refundable and staff will obtain the necessary signatures at the EDA meeting to fully execute the Purchase and Redevelopment Agreement. If the EDA denies the final sale approval, staff will reimburse the earnest money to Tollberg Homes. Staff recommends final sale approval of 4641 Tyler Street NE as presented. Dahl told members this is the last lot in the scattered site program. Questions by members: Wade Tollefson was present to answer questions. He has paid the $2,000 earnest money and if the sale is approved, that amount is non - refundable. Szurek said she is not happy with the design regarding the size of the porch. Dahl said it does meet the requirements of the program and that it is similar to other homes in the area. Schmitt commented as long as the new owners are happy with the design and it meets the requirements, she is ok with it. Motion by Schunitt, seconded by Buesgens, to waive the reading of Resolution 2018 -03, there being ample copies available to the public. All ayes. MOTIONPASSED. Motion by Schunitt, seconded by Novitsky, to adopt Resolution 2018 -03, a resolution approving the purchase and redevelopinent agreeinent with Tollberg Hoines, LLC fog^ the acquisition of 4641 Tyler Street NE, Columbia Heights, MN 55421. All ayes. MOTIONPASSED. EDA Minutes Page 7 Feb 5, 2018 RESOLUTION NO. 2018 -03 RESOLUTION APPROVING PURCHASE AND REDEVELOPMENT AGREEMENT WITH TOLLBERG HOMES, LLC. BE IT RESOLVED BY the Board of Commissioners ( "Board ") of the Columbia Heights Economic Development Authority (the "Authority ") as follows: SECTION L RECITALS. 1.01. The Authority has previously adopted a program called the Single Family Home Lot Sales Program (the "Program "), and has adopted guidelines in connection with the Program (the "Guidelines "). 1.02. The Authority has received an offer from Tollberg Homes, LLC (the "Buyer ") to purchase certain property included in the Program (the "Property "), described as attached hereto as Exhibit A, and the parties have negotiated a Purchase and Redevelopment Agreement (the "Agreement ") which provides for the conveyance of the Property to the Buyer and the construction by the Buyer of a single - family home on the Property, all pursuant to the Guidelines. 1.03. On the date hereof, the Authority conducted a duly noticed public hearing regarding the conveyance of the Property to the Buyer, at which all interested parties were given an opportunity to be heard. 1.04. The Board has reviewed the Agreement in the form on file at the office of the Executive Director and finds that the execution thereof and performance of the Authority's obligations thereunder, including the conveyance of the Property to the Buyer, are consistent with the Guidelines and in the best interest of the City and its residents. SECTION 2. APPROVAL AND AUTHORIZATION OF AGREEMENT AND CONVEYANCE. 2.01. The Agreement as presented to the Board and the conveyance of the Property provided for therein are 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 Agreement by such officials shall be conclusive evidence of approval. 2.02. Authority staff and officials are authorized to take all actions necessary to perform the Authority's obligations under the Agreement as a whole, including without limitation execution of any documents to which the Authority is a party referenced in or attached to the Agreement, and any deeds or other documents necessary to convey the Property to the Buyer, all as described in the Agreement. SECTION 3. EFFECTIVE DATE. This resolution shall be effective upon approval. ORDER OF ECONOMIC DEVELOPMENT AUTHORITY Passed this 5th day of February, 2018 Offered by: Schmitt Seconded by: Novitsky Roll Call: All ayes President Attest: Assistant Secretary EDA Minutes Page 8 Feb 5, 2018 PURCHASE AND REDEVELOPMENT AGREEMENT 4641 Tyler Street, Columbia Heights, Minnesota 1. Parties. This Purchase and Redevelopment Agreement is made as of February 5, 2018 between the COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY, a public body corporate and politic under the laws of Minnesota having its office located at 590 40TH Avenue NE, Columbia Heights, MN (the "Seller "), and Tollberg Homes, LLC, a Minnesota limited liability company, having its principal office at 1428 5t'' Avenue Anoka, MN 55303 (the "Buyer ") (the "Agreement "). 2. Offer /Acceptance. Buyer offers to purchase and Seller agrees to sell real property in Anoka County, Minnesota, legally described as follows (the "Property "): Lot Twenty -five (25) and the South 20 feet of Lot Twenty -six (26), Block Two (2) of Sheffield's Second Subdivision. Check here if part or all of the land is Registered (Torrens) 2 3. Acceptance Deadline. This offer to purchase, unless accepted sooner, shall be null and void at 4:30 p.m. on February 6, 2018, and in such event all earnest money shall be refunded to Buyer. 4. Price and Terms. The price for the Property is $27,500.00 ( "Purchase Price ") which Buyer shall pay as follows: nonrefundable earnest money of $2,000 by check, receipt of which is hereby acknowledged by Seller. The balance of the Purchase Price must be paid by certified check or wire transfer on the Date of Closing. The "Date of Closing" shall be no later than April 6, 2018. (60 days from date of this Agreement) 5. Personal Property Included in Sale. There are no items of personal property or fixtures owned by Seller and currently located on the Property for purposes of this sale. 6. Deed. Upon performance by Buyer, Seller shall deliver a quit claim deed conveying title to the Property to Buyer, in substantially the form attached as Exhibit A, subject to the conditions subsequent required by Sections 15, 16, and 17 of this Agreement (the "Deed "). 7. Real Estate Taxes and Special Assessments. A. Seller shall pay, at or before closing all real estate taxes due and payable in 2017 and prior years. Real estate taxes due and payable in the year of closing shall be paid by Buyer. B. Seller shall pay on Date of Closing all special assessments levied against the Property as of the date of this agreement, including those certified for payment in the year of closing. Seller represents that there are no special assessments pending as of the date of this agreement. If a special assessment becomes pending after the date of this agreement and before the Date of Closing, Buyer may, as Buyer's option: Assume payment of the pending special assessment without adjustment to the purchase agreement price of the property; or 2. Require Seller to pay the pending special assessment and Buyer shall pay a commensurate increase in the purchase price of the Property, which increase shall be the same as the estimated amount of the assessment; or Declare this agreement null and void by notice to Seller, and earnest money shall be refunded to Buyer. EDA Minutes Page 9 Feb 5, 2018 8. Closing Costs and Related Items. The Buyer will pay: (a) the closing fees charged by the title insurance or other closing agent, if any, utilized to close the transaction contemplated by this Agreement; (b) fees for title evidence obtained by Buyer; (c) the recording fees for this Agreement and for the Deed transferring title to Buyer. Seller will pay all other fees normally paid by sellers, including (a) any transfer taxes, and Well Disclosure fees required to enable Buyer to record its deed from Seller under this Agreement, and (b) fees and charges related to the filing of any instrument required to make title marketable. Each party shall pay its own attorney fees. 9. Sewer and Water. Seller warrants that city sewer is available at the Property line, and that city water is available in the right of way adjacent to the Property. Seller makes no warranty regarding the conditions of any existing water stub from the main to the Property line. Seller advises Buyer to inspect the condition of the water stub. 10. Condition of Property. Buyer acknowledges that they have inspected or have had the opportunity to inspect the Property and agree to accept the Property "AS IS." Buyer has the right, at its own expense to take soil samples for the purpose of determining if the soil is suitable for construction of the dwelling described in section 14 below. If the soil is determined to be unacceptable the Buyer may rescind this agreement by written notice to the Seller, in which case the agreement shall be null and void. Seller makes no warranties as to the condition of the Property. 11. Marketability of Title. As soon as reasonably possible after execution of this Agreement by both parties: (a) Seller shall surrender any abstract of title and a copy of any owner's title insurance policy for the property, if in Seller's possession or control, to Buyer or to Buyer's designated title service provider; and (b) Buyer shall obtain the title evidence determined necessary or desirable by Buyer. The Buyer shall have 20 days from the date it receives such title evidence to raise any objections to title it may have. Objections not made within such time will be deemed waived. The Seller shall have 90 days from the date of such objection to affect a cure; provided, however, that Seller shall have no obligation to cure any objections, and may inform Buyer of such. The Buyer may then elect to close notwithstanding the uncured objections or declare this Agreement null and void, and the parties will thereby be released from any further obligation hereunder. 12. Title Clearance and Remedies. If Seller shall fail to have title objections timely removed, the Buyer may, at its sole election: (a) terminate this Agreement without any liability on its part upon provision of a quit claim deed to the Property from Buyer; or (b) take title to the Property subject to such objections. If title is marketable, or is made marketable as provided herein, and Buyer defaults in any of the agreements herein, Seller may elect either of the following options, as permitted by law: A. Cancel this contract as provided by statute and retain all payments made hereunder as liquidated damages. The parties acknowledge their intention that any note given pursuant to this contract is a down payment note, and may be presented for payment notwithstanding cancellation; B. Seek specific performance within six months after such right of action arises, including costs and reasonable attorney's fees, as permitted by law. If title is marketable, or is made marketable as provided herein, and Seller defaults in any of the agreements herein, Buyer may, as permitted by law: C. Seek damages from Seller including costs and reasonable attorney's fees; D. Seek specific performance within six months after such right of action arises. EDA Minutes Page 10 Feb 5, 2018 13. Well Disclosure. Seller's knowledge of wells is as follows: [El The Seller certifies that the Seller does not know of any wells on the described real property. ❑ A well disclosure certificate accompanies this document. ❑ I am familiar with the property described in this instrument and I certify that the status and number of wells on the Property have not changed since the last previously filed well disclosure certificate. 14. Individual Sewage Treatment System Disclosure. Seller certifies that there is no individual sewage treatment system on or serving the Property. 15. Construction and Sale of Dwelling. Buyer agrees that it will construct a new single family dwelling on the Property, intended for sale to a person or persons for residential occupancy (an "Owner Occupant "). This covenant shall survive the delivery of the Deed. A. The single family dwelling described in this Section is referred to as the "Minimum Improvements." B. The Minimum Improvements shall consist of a new single family dwelling, and shall be constructed substantially in accordance with the Single Family Home Lot Sales Program Guidelines on file at City Hall and the proposal approved by Seller on December 5, 2017, attached hereto as Exhibit B. C. Construction of the Minimum Improvements must be substantially completed no later than one year from the Date of Closing. Construction will be considered substantially complete when the final certificate of occupancy has been issued by the City of Columbia Heights building official. D. Promptly after substantial completion of the Minimum Improvements in accordance with those provisions of the Agreement relating solely to the obligations of the Buyer to construct such Minimum Improvements (including the date for completion thereof), the Seller will furnish the Buyer with a Certificate of Completion, in the form attached hereto as Exhibit C, for such improvements. Such certification by the Seller 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 Buyer and its successors and assigns, to construct the Minimum Improvements and the dates for completion thereof The certificate provided for in this Section 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 Property. If the Seller shall refuse or fail to provide any certification in accordance with the provisions of this Section, the Seller shall, within thirty (30) days after written request by the Buyer, provide the Buyer with a written statement, indicating in adequate detail in what respects the Buyer 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 Seller for the Buyer to take or perform in order to obtain such certification. E. The Buyer represents and agrees that until issuance of the Certificate of Completion for the Minimum Improvements: (1) Except for any agreement for sale to an Owner Occupant, the Buyer 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 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 Seller's board of commissioners. The term "Transfer" does not include 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 Buyer to construct the Minimum Improvements or component thereof. EDA Minutes Page 11 Feb 5, 2018 (2) If the Buyer seeks to effect a Transfer prior to issuance of the Certificate of Completion, the Seller shall be entitled to require as conditions to such Transfer that: (i) any proposed transferee shall have the qualifications and financial responsibility, in the reasonable judgment of the Seller, necessary and adequate to fulfill the obligations undertaken in this Agreement by the Buyer as to the portion of the Property to be transferred; and ii) Any proposed transferee, by instrument in writing satisfactory to the Seller 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 Seller, have expressly assumed all of the obligations of the Buyer under this Agreement as to the portion of the Property to be transferred and agreed to be subject to all the conditions and restrictions to which the Buyer is subject as to such portion; provided, however, that the fact that any transferee of, or any other successor in interest whatsoever to, the 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 Seller) deprive the Seller of any rights or remedies or controls with respect to the 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 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 Seller of or with respect to any rights or remedies on controls provided in or resulting from this Agreement with respect to the Property that the Seller would have had, had there been no such transfer or change. In the absence of specific written agreement by the Seller to the contrary, no such transfer or approval by the Seller thereof shall be deemed to relieve the Buyer, or any other party bound in any way by this Agreement or otherwise with respect to the Property, from any of its obligations with respect thereto. (iii) Any and all instruments and other legal documents involved in effecting the transfer of any interest in this Agreement or the Property governed by this subsection E. shall be in a form reasonably satisfactory to the Seller. (3) If the conditions described in paragraph (2) above are satisfied then the Transfer will be approved and the Buyer shall be released from its obligation under this Agreement, as to the portion of the Property that is transferred, assigned, or otherwise conveyed. The provisions of this paragraph (3) apply to all subsequent transferors. (4) Upon issuance of the Certificate of Completion, the Buyer may Transfer the Property and/or the Buyer's rights and obligations under this Agreement with respect to such Property without the prior written consent of the Seller. F. The Buyer, and its successors and assigns, agree that they (a) will use the Minimum Improvements only as a single family dwelling, and in the case of an Owner Occupant, will occupy the Property as a residence, (b) will not rent the Property to any person or entity, (c) will not seek exemption from real estate taxes on the Property under State law, and (d) will not transfer or permit transfer of the Property to any entity whose ownership or operation of the Property would result in the Property being exempt from real estate taxes under State law (other than any portion thereof dedicated or conveyed to the City of Columbia Heights or Seller in accordance with this Agreement). The covenants in this paragraph run with the land, survive both delivery of the Deed and issuance of the Certificate of Completion for the Minimum Improvements, and shall remain in effect for ten years after the Date of Closing. EDA Minutes Page 12 Feb 5, 2018 16. Revesting Title in Seller upon Happening of Event Subsequent to Conveyance to Buyer. In the event that subsequent to conveyance of the Property or any part thereof to the Buyer and prior to receipt by the Buyer of the Certificate of Completion for of the Minimum Improvements, the Buyer, subject to Unavoidable Delays (as hereafter defined), fails to carry out its obligations with respect to the construction of the Minimum Improvements (including the nature and the date for the completion thereof), or abandons or substantially suspends construction work, and any such failure, abandonment, or suspension shall not be cured, ended, or remedied within thirty (30) days after written demand from the Seller to the Buyer to do so, then the Seller shall have the right to re -enter and take possession of the Property and to terminate (and revest in the Seller) the estate conveyed by the Deed to the Buyer, it being the intent of this provision, together with other provisions of the Agreement, that the conveyance of the Property to the Buyer shall be made upon, and that the Deed shall contain a condition subsequent to the effect that in the event of any default on the part of the Buyer and failure on the part of the Buyer to remedy, end, or abrogate such default within the period and in the manner stated in such subdivisions, the Seller at its option may declare a termination in favor of the Seller of the title, and of all the rights and interests in and to the Property conveyed to the Buyer, and that such title and all rights and interests of the Buyer, and any assigns or successors in interest to and in the Property, shall revert to the Seller, but only if the events stated in this Section have not been cured within the time periods provided above. Notwithstanding anything to the contrary contained in this Section, the Seller shall have no right to reenter or retake title to and possession of a portion of the Property for which a Certificate of Completion has been issued. For the purposes of this Agreement, the term "Unavoidable Delays" means delays beyond the reasonable control of the Buyer as a result thereof which are the direct result of strikes, other labor troubles, prolonged adverse weather or acts of God, 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 federal, state or local governmental unit (other than the Seller in exercising its rights under this Agreement) which directly results in delays. Unavoidable Delays shall not include delays in the Buyer's obtaining of permits or governmental approvals necessary to enable construction of the Minimum Improvements by the dates such construction is required under this section of this Agreement. 17. Resale of Reacquired Property; Disposition of Proceeds. Upon the revesting in the Seller of title to and/or possession of the Property or any part thereof as provided in Section 16, the Seller shall apply the purchase price paid by the Buyer under Section 4 of this Agreement as follows: (a) First, to reimburse the Seller for all costs and expenses incurred by the Seller, including but not limited to proportionate salaries of personnel, in connection with the recapture, management, and resale of the Property or part thereof (but less any income derived by the Seller from the Property or part thereof in connection with such management); all taxes, assessments, and water and sewer charges with respect to the Property or part thereof (or, in the event the Property is exempt from taxation or assessment or such charge during the period of ownership thereof by the Seller, an amount, if paid, equal to such taxes, assessments, or charges (as determined by the Seller assessing official) as would have been payable if the Property were not so exempt); any payments made or necessary to be made to discharge any encumbrances or liens existing on the Property or part thereof at the time of revesting of title thereto in the Seller or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of the Buyer, its successors or transferees; any expenditures made or obligations incurred with respect to the making or completion of the Minimum Improvements or any part thereof on the Property or part thereof, and any amounts otherwise owing the Seller by the Buyer and its successor or transferee; and EDA Minutes Page 13 Feb 5, 2018 (b) Second, to reimburse the Buyer for the balance of the purchase price remaining after the reimbursements specified in paragraph (a) above. Such reimbursement shall be paid to the Buyer upon delivery of an executed, recordable warranty deed to the Property by the Buyer to the Seller. 18. Time is of the essence for all provisions of this contract. 19. Notices. All notices required herein shall be in writing and delivered personally or mailed to the address shown at paragraph 1 above and, if mailed, are effective as of the date of mailing. 20. Minnesota Law. This contract shall be governed by the laws of the State of Minnesota. 21. Specific Performance. This Agreement may be specifically enforced by the parties, provided that an action is brought within one year of the date of alleged breach of this Agreement. 22. No Remedy Exclusive. No remedy herein conferred upon or reserved to the Seller or Buyer 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. 23. No Merger of Representations, Warranties. All representations and warranties contained in this Purchase Agreement shall not be merged into any instruments or conveyance delivered at closing, and the parties shall be bound accordingly. 24. Recording. This Agreement shall be filed of record with the Anoka County Registrar of Titles or Office of Recorder, as the case may be. Buyer shall pay all recording costs. 25. No Broker Involved. The Seller and represent and warrant to each other that there is no broker involved in this transaction with whom it has negotiated or to whom it has agreed to pay a broker commission. Buyer agrees to indemnify Seller for any and all claims for brokerage commissions or finders' fees in connection with negotiations for purchase of the Property arising out of any alleged agreement or commitment or negotiation by Buyer, and Seller agrees to indemnify Buyer for any and all claims for brokerage commissions or finders' fees in connection with negotiations for purchase of the Property arising out of any alleged agreement or commitment or negotiation by Seller. In witness of the foregoing, the parties have executed this agreement on the year and date written above. SELLER: COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY By: Its President STATE OF MINNESOTA COUNTY OF ANOKA } ss. Its Executive Director EDA Minutes Page 14 Feb 5, 2018 The foregoing was acknowledged before me this day of 2018, by and Walter Fehst, the President and Executive Director of Columbia Heights Economic Development Authority, a public body corporate and politic under the laws of Minnesota, on behalf of the public body corporate and politic. BUYER: Tollberg Homes, LLC STATE OF MINNESOTA } ss. COUNTY OF ANOKA Notary Public The foregoing was acknowledged before me this day of , 2018, by Wade Tollefson, the Chief Manager of Tollberg Homes, LLC, a Minnesota limited liability company, on behalf of the limited liability company. Notary Public EXHIBIT A to PURCHASE AND REDEVELOPMENT AGREEMENT FORM OF QUIT CLAIM DEED Deed Tax Due: $ ECRV: THIS INDENTURE, between the Columbia Heights Economic Development Authority, a Minnesota, a public body corporate and politic (the "Grantor "), and , a Minnesota (the "Grantee "). WITNESSETH, that Grantor, in consideration of the sum of $ and other good and valuable consideration the receipt whereof is hereby acknowledged, does hereby grant, bargain, quitclaim and convey to the Grantee, its successors and assigns forever, all the tract or parcel of land lying and being in the County of Anoka and State of Minnesota described as follows, to -wit (such tract or parcel of land is hereinafter referred to as the "Property "): Check here if part or all of the land is Registered (Torrens) ❑ To have and to hold the same, together with all the hereditaments and appurtenances thereunto belonging. SECTION 1. EDA Minutes Page 15 Feb 5, 2018 It is understood and agreed that this Deed is subject to the covenants, conditions, restrictions and provisions of an agreement recorded herewith entered into between the Grantor and Grantee on the of 20, identified as "Purchase and Redevelopment Agreement" (hereafter referred to as the "Agreement ") and that the Grantee shall not convey this Property, or any part thereof, except as permitted by the Agreement until a certificate of completion releasing the Grantee from certain obligations of said Agreement as to this Property or such part thereof then to be conveyed, has been placed of record. This provision, however, shall in no way prevent the Grantee from mortgaging this Property in order to obtain funds for the purchase of the Property hereby conveyed or for erecting the Minimum Improvements thereon (as defined in the Agreement) in conformity with the Agreement, any applicable development program and applicable provisions of the zoning ordinance of the City of Columbia Heights, Minnesota, or for the refinancing of the same. It is specifically agreed that the Grantee shall promptly begin and diligently prosecute to completion the redevelopment of the Property through the construction of the Minimum Improvements thereon, as provided in the Agreement. Promptly after completion of the Minimum Improvements in accordance with the provisions of the Agreement, the Grantor will furnish the Grantee with an appropriate instrument so certifying. Such certification by the Grantor shall be (and it shall be so provided in the certification itself) a conclusive determination of satisfaction and termination of the agreements and covenants of the Agreement and of this Deed with respect to the obligation of the Grantee, and its successors and assigns, to construct the Minimum Improvements and the dates for the beginning and completion thereof Such certification and such determination shall not constitute evidence of compliance with or satisfaction of any obligation of the Grantee to any holder of a mortgage, or any insurer of a mortgage, securing money loaned to finance the purchase of the Property hereby conveyed or the Minimum Improvements, or any part thereof. All certifications provided for herein shall be in such form as will enable them to be recorded with the County Recorder, or Registrar of Titles, Anoka County, Minnesota. If the Grantor shall refuse or fail to provide any such certification in accordance with the provisions of the Agreement and this Deed, the Grantor shall, within thirty (30) days after written request by the Grantee, provide the Grantee with a written statement indicating in adequate detail in what respects the Grantee 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 Grantor, for the Grantee to take or perform in order to obtain such certification. SECTION 2. The Grantee's rights and interest in the Property are subject to the terms and conditions of Sections 15, 16 and 17 of the Agreement relating to the Grantor's right to re -enter and revest in Grantor title to the Property under conditions specified therein, including but not limited to termination of such right upon issuance of a Certificate of Completion as defined in the Agreement. SECTION 3. The Grantee agrees for itself and its successors and assigns to or of the Property or any part thereof, hereinbefore described, that the Grantee and such successors and assigns shall comply with Section 15F of the Agreement for a period of ten years after the date hereof. It is intended and agreed that the above and foregoing agreements and covenants shall be covenants running with the land for the respective terms herein provided, and that they shall, in any event, and without regard to technical classification or designation, legal or otherwise, and except only as otherwise specifically provided in this Deed, be binding, to the fullest extent permitted by law and equity for the benefit and in favor of, and enforceable by, the Grantor against the Grantee, its successors and assigns, and every successor in interest to the Property, or any part thereof or any interest therein, and any party in possession or occupancy of the Property or any part thereof. EDA Minutes Page 16 Feb 5, 2018 In amplification, and not in restriction of, the provisions of the preceding section, it is intended and agreed that the Grantor shall be deemed a beneficiary of the agreements and covenants provided herein, both for and in its own right, and also for the purposes of protecting the interest of the community and the other parties, public or private, in whose favor or for whose benefit these agreements and covenants have been provided. Such agreements and covenants shall run in favor of the Grantor without regard to whether the Grantor has at any time been, remains, or is an owner of any land or interest therein to, or in favor of, which such agreements and covenants relate. The Grantor shall have the right, in the event of any breach of any such agreement or covenant to exercise all the rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breach of agreement or covenant, to which it or any other beneficiaries of such agreement or covenant may be entitled; provided that Grantor shall not have any right to re -enter the Property or revest in the Grantor the estate conveyed by this Deed on grounds of Grantee's failure to comply with its obligations under this Section 3. IN WITNESS WHEREOF, the Grantor has caused this Deed to be duly executed in its behalf by its President and Executive Director, this day of , 20 ❑ The Seller certifies that the Seller does not know of any wells on the described real property. ❑ A well disclosure certificate accompanies this document or has been electronically filed. (If electronically filed, insert WDC number: ). ❑ I am familiar with the property described in this instrument and I certify that the status and number of wells on the described real property have not changed since the last previously filed well disclosure certificate. STATE OF MINNESOTA ) ) ss COUNTY OF ANOKA ) COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY By Its President By Its Executive Director On this day of 20 before me, a notary public within and for County, personally appeared and to me personally known who by me duly sworn, did say that they are the President and Executive Director of the Columbia Heights Economic Development Authority (the "Authority ") named in the foregoing instrument; that said instrument was signed on behalf of said Authority pursuant to a resolution of its governing body; and said and _ _ acknowledged said instrument to be the free act and deed of said Authority. This instrument was drafted by Kennedy & Graven, Charted 470 U.S. Bank Plaza 200 South Sixth Street Minneapolis, MN 55402 (612) 337 -9300 Notary Public Tax Statements should be sent to: EDA Minutes Page 17 Feb 5, 2018 EXHIBIT B ME PURCHASE AND REDEVELOPMENT AGREEMENT APPROVED PROPOSAL :J111- -a I- -A HE :7 A � -1 � / V6;64:! 'MENS .Pz',P� , ,09 - NNW-1 p2-� Mlh� 2,! / }� \a a( /§ d T }) \ ,} � ) W 03 OTT A 4z .Q , I -)I In PQ OC Ny o DL j 3 74 IkA and EXHIBIT C TO PURCHASE AND REDEVELOPMENT AGREEMENT FORM OF CERTIFICATE OF COMPLETION CERTIFICATE OF COMPLETION WHEREAS, the Columbia Heights Economic Development Authority, a public body, corporate and politic (the "Grantor "), conveyed land in Anoka County, Minnesota to , a (the "Grantee "), by a Deed recorded in the Office of the County Recorder [and in the Office of the Registrar of Titles] in and for the County of Anoka and State of Minnesota, as Document Numbers and , respectively; 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 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 have been completed and the above covenants and conditions in said Deed and the agreements and covenants in Section 15B of the Agreement (as described in said Deed) have been performed by the Grantee therein, and the County Recorder [and the Registrar of Titles] in and for the County of Anoka and State of Minnesota are 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 Section 15B of the Agreement and the covenants and restrictions set forth in Sections 1 and 2 of said Deed; provided that the covenants set forth in Sections 15F of the Agreement, and in Section 3 of the Deed, remain in full force and effect through the period stated thereon. Dated: , 20 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 20 , by and , the President and Executive Director, respectively, of the Columbia Heights Economic Development Authority, on behalf of the authority. Notary Public This document drafted by: KENNEDY & GRAVEN, CHARTERED 470 U.S. Bank Plaza Minneapolis, MN 55402 (612) 337 -9300 EDA Minutes Page 23 Feb 5, 2018 3. Updates from 2017 and Discussion for 2018 Projects Dahl stated that throughout 2017, the Economic Development Authority (the "EDA ") accomplished several projects and objectives. The purpose of this report is to review and discuss the EDA's accomplishments in 2017, but also to determine the projects and objectives that the EDA would like staff to focus on in 2018. Highlights of 2017 accomplishments include, but not limited to the following: 2017 EDA Accomplishments • Facilitated redevelopment of the property located at 47th Avenue NE and Grand Avenue NE with the development of the Grand Central Flats in an effort to complete the Grand Central Neighborhood which was originally initiated back in 2003. • Leveraged funds through the Grand Central Flats development to collect park dedication fees in the amount of $222,000 for park improvements through the City of Columba Heights (the "City "). • Refinanced the Public Safety Facility Lease Revenue Bonds, series 2007B (Municipal Liquor Stores), to save the City a net present value of $775,000. • Increased the EDA Levy to the statutory levy limit to increase the amount of funds for economic development purposes. • Identified and received an interfund transfer in the amount of $1,025,445 from the Fund 213: Park View Villa to Fund 408: EDA Redevelopment Projects Fund. • Initiated the Commercial Revitalization Program, a program setup to acquire nonconforming properties under the current zoning code of the City through all commercial corridors. • Sold or pending sale of all remaining lots in the Single Family Home Lot Sales Program. Dahl told members that 25 homes have been re -built throughout the City selling at a price between $200,000 - $250,000. • Chose to participate in the Anoka County Levy program. Now, as the EDA looks ahead to 2018, staff seeks to facilitate discussion about what projects, programs, and objectives commission members desire to see initiated and/ or completed in 2018. First, staff would like to review the fund balances of several accounts that the EDA utilizes to accomplish its initiatives. The figures below are estimations and subject to change as the year -end fund balances have not been finalized for all the accounts. • Fund 226: Special Projects Revenue: $ 887,000 • Fund 371: TIF T4 Kmart/ Central Ave: $ 430,000 • Fund 376: TIF A3,C7,C8 Scattered Site District: $ 112,000 • Fund 408: EDA Redevelopment Project Fund $ 821,000 • Fund 420: CAP Improvement Development: $ 1,695,000 • Anoka County HRA Levy: $ 515,000 The list below provides a starting point for the discussion tonight. Staff highly encourages the EDA commission members to provide feedback and propose changes to the following 2018 proposed projects, programs, and objectives: 2018 Proposed Proiects. Prograins and Obiectives Continue the development of and initiation of a business retention and expansion program to assist the Columbia Heights business community. EDA Minutes Page 24 Feb 5, 2018 • Reevaluate the guidelines, specifications, and requirements of the Single Family Home Lot Sales Program, and continue to incorporate vacant lots into the Single Family Home Lot Sales Program. • Evaluate the possibility of introducing an exterior facade improvement or a surveillance system grant program for the Columbia Heights business community. Schmitt liked this idea. • Determine a fund source and create a housing rehabilitation grant or low to no interest loan program for exterior remodels and/ or interior renovations. • Acquire and remediate the Root Property located on the corner of 40th Avenue NE and University Avenue NE. Dahl told members this would be more than a one year project since the remediation would take several years to complete. • Relocate the residential structure located at 3841 Central Avenue NE to 666 40th Avenue NE. • Identify a redevelopment opportunity for the property located at 828 40th Avenue NE. Comments: (1) Williams asked about the round -a -bout piece. Dahl told them Dominium is working on paperwork to donate the parcel to the City. Since the property is zoned as MXU and this is the last piece left, it must be developed commercially as the rest of the development is all residential. It is a small parcel and there is no interest by commercial developers in a site this small. Hogeboom said the only way it could be developed other than commercial would require the district to be completely re- zoned. Another issue with the piece is that the soil is contaminated at a depth of 8 feet. So anything constructed deeper than that will require additional costs for cleanup. Buesgens asked how much the lot is worth. It was noted that it is just over an acre in size and generates approximately $6,500 in annual taxes currently. She wondered if the property could be used for community garden space while we wait for it to be developed in some capacity. Dahl said that is an option, but that the contaminated soil may prevent that. Soil tests would have to be done to ensure it is safe. Novitsky asked about the history of the development and why other commercial uses weren't built when there was more property available. Fehst explained that originally the piece on 37h Avenue and University was earmarked for a commercial development but there wasn't any interest from developers wanting to construct commercial buildings, especially since the downturn in the economy starting in 2008. And since that time, financial assistance to developers has been for multi - family, high density residential construction. (2) Schmitt said she thinks a goal for 2018 should be to focus on creating zoning districts to keep properties on the tax rolls as previously discussed in the meeting. (3) Szurek asked about the status of the HyVee construction. Dahl said he reached out to his contact to get another update and to remind them that the Public Financial Assistance for cleanup /remediation that was approved requires that construction start by June 2018. He had not heard back from him prior to this meeting. There was a discussion regarding the recent news article regarding HyVee also getting approvals for the construction of a store in Spring Lake Park. Staff noted they just received the City's approvals, closed on the property at the end of January and that no construction date has been set for that store either. So at this point, there is no reason to believe that the Spring Lake Park store will be done before ours. (4) Szurek asked if there was any way to stay on top of properties that are vacated and run down for possible purchase by the City. There was a discussion about this issue. EDA Minutes Page 25 February 5, 2018 (5) Schmitt asked if members should give staff any other ideas for 2018 objectives they would like to pursue. Dahl told members to forward any other ideas they had to him. 4. Update on 3841 Central Ave NE Dahl told members that staff is still weighing all options. Kevin Hansen said the plumbing could be fixed and that the house is in solid condition construction wise. Dahl said that GMHC had reached out to him again, and that he told them there would not be any gap financing given that they had previously requested. He suggested to GMHC about possibly swapping properties with them (3805 2nd St that they own for 666 40d' Ave that we own). That wady they could move the house to the 666 40d' Ave site which would be less expensive than moving it to the 38052 n St lot. Dahl said GMHC's legal team is looking into this idea. The meeting was adjourned at 7:40 pm Respectfully submitted, Shelley Hanson Secretary