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HomeMy WebLinkAbout2007 10-08 EDAP EDA MEETING City of Brooklyn Center October 8, 2007 AGENDA 1. Call to Order —The EDA requests that attendees turn off cell phones and pagers during the meeting. A copy of the full City Council packet, including EDA (Economic Development Authority), is available to the public. The packet ring binder is located at the front of the Council Chambers by the Secretary. 2. Roll Call 3. Approval of Agenda and Consent Agenda —The following items are considered to be routine by the Economic Development Authority (EDA) and will be enacted by one motion. There will be no separate discussion of these items unless a Commissioner so requests, in which event the item will be removed from the consent agenda and considered at the end of Commission Consideration Items. a. Approval of Minutes 1. September 24, 2007 Regular Session 4. Commission Consideration Items a. Resolution Approving and Authorizing Execution of a Second Amendment to the Development Agreement Between the Econornic Development Authority and Brooklyn Hotel Partners, LLC •Requested Commission Action: —Motion to adopt resolution. b. Resolution Amending EDA Resolution No. 2007-13 Approving and Authorizing Early Construction Under Development Agreement Between the Economic Development Authority, the City of Brooklyn Center and Brooklyn Hotel Partners, LLC •Requested Commission Action: —Motion to adopt resolution. 5. Adjournment r v v. 4 s 'w" t v fl t MINUTES OF THE PROCEEDINGS OF THE ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA REGULAR SESSION SEPTEMBER 24, 2007 CITY HALL COUNCIL CHAMBERS 1. CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in Regular Session called to order by President Tim Willson at 7:44 p.m. 2. ROLL CALL President Tim Willson and Commissioners Kay Lasman, Mary O'Connor, Dan Ryan, and Mark Yelich. Also present were Executive Director/Ciry Manager Curt Boganey, Public Works Director/City Engineer Todd Blomstrom, Community Development Director Gary Eitel, City Attorney Charlie LeFevere, and Deputy City Clerk Camille Worley. 3. APPROVAL OF AGENDA AND CONSENT AGENDA Commissioner Lasman moved and Commissioner Ryan seconded approval of the Agenda and Consent Agenda, and the following item was approved: 3a. APPROVAL OF MINUTES 1. August 13, 2007 Regular Session Motion passed unanimously. 4. COMMISSION CONSIDERATION ITEMS 4a. RESOLUTION NO. 2007-18 RESOLUTION APPROVING DISSOLVING TAX INCREMENT FINANCING DISTRICT NO. 1 AND RETURNING EXCESS TAX INCREMENTS TO OTHER TAXING JURISDICTIONS Executive Director/City Manager Curt Boganey introduced the item, discussed the history, and stated the purpose of the proposed resolution. Commissioner Yelich moved and Commissioner O' Connor seconded adoption of RESOLUTION NO. 2007-18 Approving Dissolving Tax Increment Financing District No. 1 and Returning Excess Tax Increments to Other Taxing Jurisdictions. Motion passed unanimously. 09/24/07 -1- DRAFT 5. ADJOURNMENT Commissioner Lasman moved and Commissioner Ryan seconded adjournment of the Economic Development Authority meeting at 7:53 p.m. Motion passed unanimously. 09/24/07 -2- DRAFT F.: E r �f t a„ t r Y COUNCIL ITEM MEMORANDUM TO: Curt Boganey, City Manager FROM: Tom Bublitz, Community Development SpecialisY 1� DATE: October 4, 2007 SUBJECT: EDA Resoiution Approving and Authorizing Execution of a Second Amendment to the Development Agreement Between the EDA and Brooklyn Hotel Partners, LLC Recommendation: Recommend EDA consider adoption of the Resolution Approving and Authorizing Execution of a Second Amendment to the Development Agreement Between the EDA and Brooklyn Hotel Partners, LLC. This resolution is a technical amendment to the development agreement between the Economic Development Authority (EDA) and Brookl}m Center Hotel Partners, LLC. The original development agreement was approved on October 23, 2006. A copy of the second amendment is included with this memorandum. Background: This resolution is a technical amendment to the October 23, 2006 development agreement and addresses the following: Extends the closing date on the purchase of the Phase I hotel property from October 1, 2007 to January 15, 2008. EDA Resolution No. 2007-12 (approved July 23, 2007) approved the first aanendment to the October 23, 2006 Development Agreement. The first amendment revised the closing date from Apri130, 2007 to October 1, 2007. The January 15, 2008 closing date was requested by the developer's legal counsel. Loan approval for the project is moving forwazd and the Developer's attorney is confidant closing will occur on or before January 15, 2008. On July 23, 2007, the EDA approved Resolution N. 2007-13 wluch authorized early construction for earth moving, grading, general site preparation and utility work. Pursuant to EDA Resolution No. 2007-13, the Developer must meet certain requirements before they are allowed an early construction start. Staff is working with the Developer's legal counsel and the EDA's attomey to address the early construction start requirements set forth in EDA Resolution No. 2007-13. A copy of Resolution No. 2007-13 is included for reference. Also contained in #he second amendment to the Development Agreement and pursuant to the terms of the early construction start Resolution No. 2007-13, the date for the commencement of construction is revised from October 1, 2007 to October 3l, 2007. Budget Issues: There are no budget issues. SECOND AMENDMENT TO DEVELOPMENT AGREEMENT BY AND BETWEEN ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER AND BROOKLYN HOTEL PARTNERS, LLC This document drafted by: BRIGG5 AND MORGAN (DGG) Professional Association 2200 IDS Center 80 South Eighth Street Minneapolis, MN 55402-2157 2088993v2 SECOND AMENDMENT TO DEVELOPMENT AGREEMENT THIS SECOND AMENDMENT TO DEVELOPMENT AGREEMENT (the "Second Amendment"), made as of the 8th day of October, 2007, by and between the Economic Development Authority of Brooklyn Center, Minnesota (the "Authority"), a body corporate and politic orgaxuzed and existi.ng under the laws of the State of Minnesota, and Brooklyn Hotel Partners, LLC, a Minnesota limited liability company (the "Developer"). WITNESSETH: WHEREAS, the Authority and the Developer have previously entered into a Development Agreement dated as of October 23, 2006, as amended July 23, 2007 (as amended, the "Development Agreement"), pursuant to which the Authority agreed to, among other things, abate certain taxes to the Developer to assist with certain public redevelopment costs of a project undertaken by the Developer in the City; and WHEREAS, the Developer and Authority desire to further aznend the Development Agreement to provide for an amended and extended closing date for phase one of the development; NOW, THEREFORE, in consideration of the remises and the mutual obligations of the P parties hereto, each of them does hereby covenant and agree with the other that the Development Agreement is hereby amended as follows: 1. Definitions. The following capitalized terms set forth in Section 1.1 of the Development Agreement are hereby amended as follows: "Closine Date" means the dates on which the Phase I Property and Phase II Property are conveyed by the Authority to the Developer, which dates shall be as the parties mutually agree, but which date sha11 in no event be later than Jan 15, 2008 with re ect to the Phase I Pro e and not later than A ri130, �Y P rtY P 2012 for the Phase II Property. Second Amendment to Develonment A�eement means the Se�ond Amendment to Development Agreement by and between the Authority and the Developer dated October 8, 2007." 2. The October 1, 2007 date for the commencement of Phase I Property Minimum Improvements as provided in Section 4.4 is hereby revised and extended to October 31, 2007. 3. This Second Amendment may be executed in any number of counterparts, each of which shall constitute one and the same instrument. 4. This Second Amendment will be governed and construed in accordance with the laws of the State. 2088993v2 1 5. Except as herein amended, all other terms and provisions of the Development Agreement shall remain in full force and effect. [end of page] 2088993v2 2 IN WITNESS WHEREOF, the Authority has caused this Second Amendment to Development Agreement to be duly executed in its name and on its beha.lf and the Developer has caused this Agreement to be duly executed in its name and on its behalf, on or as of the date first above written. BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY By Its By Its This is a signature page to the Second Amendment to Development Agreement dated October 8, 2007, by and between the Economic Development Authority of Brooklyn Center and Brooklyn Hotel Partners, LLC. Zos8�3�2 3 i BROOKLYN HOTEL PARTNERS, LLC B�� Its This is a signature page to the Second Amendment to Development Agreement dated October 8, 2007, by and between the Brooklyn Center Economic Development Authority and Brooklyn Hotel Partners, LLC. 2088993v2 4 Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION APPROVING AND AUTHORIZING EXECUTION OF A SECOND AMENDMENT TO THE DEVELOPMENT AGREEMENT BETWEEN THE ECONOMIC DEVELOPMENT AUTHORITY AND BROOKLYN HOTEL PARTNERS,LLC WHEREAS, the Economic Development Authority of Brooklyn Center, Minnesota (the EDA) has heretofore entered into a development agreement (T'he Development Agreement) between the EDA, the City of Bmoklyn Center (The City) and Brooklyn Hotel Partners, LLC, a Minnesota. Limited Liability Company (The Developer) in connection with the developers proposed construction of a hotel development in the City (The Project); and WHEREAS, the EDA has caused to be prepared a Second Amendment to Development Agreement between the EDA and the Developer providing for a later extended closing date for the purchase and construction of Phase I of the Development; and NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center, Minnesota as follows: i Section T. The Board of Commissioners hereby approves the Second Amendment to Development Agreement and the President and Executive Director aze hereby authorized and directed to execute the Second Amendment to Development Agreement on behalf of the EDA. Date President The motion for the adoption of the foregoing resolution was duly seconded by commissioner and upon vote being taken thereon, the following voted �in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. y s.; t w.. �t E z F.,.,., t w .o- r w •i .r r. t F, z TM���y����� ,i r ..�..a. v i ,c. ��..v v s, fi .t :s ::r x i::.� o E j w t S r i r: r ....:i F e .4 r ,r e.: :r::. t: :..v: ..:i :.t ..i y' e ti:. .i, i: e -.,.t: m t: .y r t� ..i ..;q s :1 .:y: i i _v....: ..i: '.i i: b ..ys .e,' I I MEMORANDUM To: Curt Boganey, City Manager From: Tom Bublitz, Community Development Specialist�� 1 Date: October 3, 2007 Subject: Resolution Amending EDA Resolution No. 2007-13, A Resolution Approving and Authorizing Early Construction Under Development Agreement Between the Economic Development Authority, the City of Brooklyn Center, and Brooklyn Hotef Partners, LLC Recommendation: Recommend EDA consider adoption of Resolution Amending EDA Resolution No. 2007-13, A Resolution Approving and Authorizing Early Construction Under Development Agreement Between the Economic Development Authority, the City of Brooklyn Center, and Brookiyn Hotel Partners, LLC Background: EDA Resolution No. 2007-13 was approved by the EDA board at its July 23, 2007 meeting. The purpose of Resolution No. 2007-13 was to allow the developer of the hotel project to commence construction of Phase I of the hotel project prior to closing on the property. A copy of EDA Resolution 2007-13 is included for reference. EDA Resolution 2007-13 provided for an early start of limited elements of construction, namely earth moving, grading, general site preparation and utility work. The developer has requested that they be allowed to commence work on additional elements of construction with the intent of continuing construction with no limits on their progress. The developer's intent is to put construction on the project on a fast track for completion in the fall of 2008. The closing date for the developer's acquisition of the site has been pushed out to January 15, 2008. The closing could, and will hopefully, close before January 15, 2008, but no specific date has been set. Staff is recommending Resolution 2007-13 be amended to allow the developer to commence construction on additional items over and above those which were described in Resolution 2Q07-13, specifically building footings and foundations. Staff and the �DA legal counsel's concern is that any items constructed on the property prior to closing would be problematic if the developer was unable to close on the loan to continue construction of the project. Section 1a of Resolution 2007-13 addresses this issue by requiring a"written agreement signed by developer agreeing to perform the work in accordance with the terms of the development agreement, including without limitation all indemnities and such other protections as the Executive Director of the EDA may, in his sole discretion, require". One of the conditions that would be included in the written agreement required by Section 1a is that "Upon any termination or cancellation of the development agreement for any reason whatsoever, any and all improvements constructed and/or installed on the Phase I property shall then automatically become the sole property of authority without obligation of authority to pay or reimburse deve4oper or developer's contractors or any other person or entity for the cost or value of such improvements or installing or constructing the same. Authority may, at its election, upon written notice to developer, require developer to remove all or any part of such improvements and to restore the Phase I property to its condition prior to the commencement of the permitted activities all at the sole cost and expense of developer." Staff believes this provision would address the concerns of restoring the site should the project not go forward. Budget Issues: There are no budget issues. Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION AMENDING EDA RESOLUTION 2007-13 APPROVING AND AUTHORIZING EARLY CONSTRUCTION UNDER DEVELOPMENT AGREEMENT BETWEEN THE ECONOMIC DEVELOPMENT AUTHORITY, THE CITY OF BROOKLYN CENTER AND BROOKLYN HOTEL PARTNERS, LLC WI�REAS, the Economic Development Authority of the City of Brooklyn Center, Minnesota (the EDA) has heretofore entered into a development agreement as amended (the Development Agreement) between the Economic Development Authority, the City of Brooklyn Center (the City) and Brooklyn Hotel Partners, LLC, a Minnesota Limited Liability Company (the Developer) in connection with the Developer's proposed construction of a hotel development in the city (the Proj ect); and WHEREA5, the Developer has requested that it be allowed to commence construction of certain project improvements on Phase I of the Development prior to the closing of the acquisition of Phase I by the Developer in addition to those project impmvements authorized by EDA Resolution 2007-13. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center, Minnesota as follows: 1. EDA Resolution 2007-13 shall be amended to provide that the description of early start construction work shall be limited to the following: Site grading, utilities, including storm water and storm water retention pond and building footings and foundations. Permits required for all work. 2. All provisions of Resolution 2007-13 shall apply to the amendment established in this resolution. Date President The motion for the adoption of the foregoing resolution was duly seconded by commissioner and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. Co si mmis oner Dan Ryan introduced the following resolution and moved its adoption: EDA RESOLUTION NO. 2007-13 RESOLUTTON APPROVING AND AUTHOR1ZIl�iG EARLY C�NSTRUCTION UNDER DEVELOPMENT AC�REEMENT BETWEEN THE ECONOMIC DEVELOPMENT AUTHORITY, THE CITY OF BROOKLYN CENTER AND BROOKLYN HOTEL PARTNERS, LLC WHEREAS, the Economic Developmettt Authority of the City of Brooklyn Center, Minnesota (the "EDA") has heretofore entered into a Development Agreement, as amended (the "Development Agreement") between the Economic Development Authority, the City of Brooklyn Cenxer (the "City") and Broaklyn Hotel Parmers, LLC, a Minnesota limited liability company (the "Developer"), in connection with the Developer's proposed construction of a hotel development in the City (the '�project and WHEREAS, the Developer has requested that it be allowed to commence construction of certain Project improvements on phase one of the development priar to the closing of the acquisition of phase one by the Developer. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority of the City of Brooklyn Center as follows: Section 1. Board of Coa�missioners daes hereby approve the early start of construction on phase one Lot 1, Block 1, Brooklyn Fazm Second Addition (the "Property") by the Developer, provided that such canst�uction be limited only to certain site preparation work, including only earth moving, grading, general site preparation and utility work (collectively, the "Work"), and further provided that prior to the commencement of the'OVork, Develaper provide to the IDA and the City the following: a. A written agreement signed by Developer agreeing to perform the Work in accordance with the terms of the Development Agr�ement, including without limitation sll indemnities and sueh other protections as the Executive Director vf the EDA may, in his sole discretion, require. b. A written eommitment for conshuetion financing in form and substance acceptable to the Executive Director of the EDA and consistent with the requirements of the Development Agreement. c. Written approval of the EDA of the grading plans for phase one of the Project and a gradin8 Permit and such other permits and approvals as may be necessary for the Work issued by the City or other governing authorities or entities and aIl applicable utility companies. EDA RESOLUTION NO. 2007-13 d. Copies of all signed contracts and subcontracts for the Vl/ork (the "Contracts"). e. Certificates of insursnce as specified in Article VIII of the Development Agreement. f. Signed consents and waivers in favar of thc EDA and the City in form and substaace acceptable to the Executive Director of the EDA from each contractor and subcontractor performing the Work whereby all contractors and subcontractors under the Contracts agree that (i) payment for a11 work performed by them will be the sole responsibility of the Developer, and {ii) a111iens and claims they may have for the cost of the Work against the EDA, the City and/or the Properiy are waived and released. Notwithstanding the foregoing to thc contrary, no such Wark shall be commenced if the Executive Director of the EDA determines that there exists good reason to withhold and/or deny approval for the commencement of the Work, including without limitation, the failure or likely failure of the Developer,. as determined by the Executive Director of the EDA in his sole discretion, t� timely perforin and observe all of its obligatioas and responsibilities under the Development Agreement Julv 23. 20Q7 Date President The morion for the adaption of the foregoing resolution was duly seconded by Commissioner Mark Yelich andupon vote being taken thereon, the fnllowing voted in favor thereof: Z�cn Willson, Kay Lascaan, Dan Ryan, a�d Mark Yelich; a�d the following voted against the same: MaLy 0' Co�mor; whereupon said resolution was declarefl duly passed and adopted.