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HomeMy WebLinkAbout1997 06-09 EDAP Regular Session • EDA AGENDA CITY OF BROOKLYN CENTER June 9, 1997 7 p.m. 1. Call to Order 2. Roll Call 3. Approval of Agenda -The following items are considered to be routine by the Economic Development Authority 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 - Commissioners not present at meetings will be recorded as abstaining from the vote on the minutes. 1. May 12, 1997 - Regular Session • 4. Commission Consideration Items a. Resolution Authorizing Administrative Settlement for Acquisition of Property in the 53rd Avenue Development and Linkage Project -Requested Commission Action: - Motion to adopt resolution. b. Resolution Approving Relocation - Claim for Property in the 53rd Avenue Development and Linkage Project - Requested Commission Action: - Motion to adopt resolution. 5. Adjournment • DRAFT 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 MAY 12, 1997 CITY HALL CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in regular session and was called to order by President Myrna Kragness at 7:58 p.m. ROLL CALL President Myrna Kragness, Commission members Kathleen Carmody, Debra Hilstrom, Kay Lasman, and Robert Peppe. Also present: Executive Director Michael J. McCauley, Assistant City Manager Jane Chambers, Public Services Director Diane Spector, City Attorney Charlie • LeFevere, and Council Secretary LeAnn Larson. APPROVAL OF AGENDA AND CONSENT AGENDA A motion by Commission member Hilstrom and seconded by Commission member Lasman to approve the agenda and consent agenda as printed passed unanimously. APPROVAL OF MINUTES A motion by Commission member Hilstrom and seconded by Commission member Lasman to approve the minutes of the April 28, 1997 -- Regular Session as printed passed unanimously. COMMISSION CONSIDERATION ITEMS RESOLUTION NO. 97 -15 Member Carmody introduced the following resolution and moved its adoption: RESOLUTION APPROVING RELOCATION CLAIM FOR PROPERTY IN THE 53RD AVENUE DEVELOPMENT AND LINKAGE PROJECT 5/12/97 _ 1 _ DRAFT The motion for the adoption of the foregoing resolution was duly seconded by member Lasman • and passed unanimously. ADJOURNMENT A motion by Commission member Carmody and seconded by Commission member Lasman to adjourn the meeting at 8:00 p.m. passed unanimously. President Recorded and transcribed by: LeAnn Larson I i 5/12/97 -2- �0/ COW Memorandum SMlgl To: Michael J. McCauley, City Manager From: Tom Bublitz, Community Development Specialist Date: June 3, 1997 Subject: Resolution Authorizing Administrative Settlement for Acquisition of Property in the 53rd Avenue Development and Linkage Project The information contained in this memorandum and accompanying resolution is confidential and should not be made available to the general public. The initial appraisal report done by the contract appraiser, hired by the EDA to appraise the 53rd Avenue Development and Linkage Project area properties, listed James A. Starkweather as owner of the property located at 5306 Camden Avenue North. The appraisal report noted that Mr. Starkweather was deceased and Anna Starkweather, James Starkweather's sister -in -law, was a tenant in the 5306 Camden property. The property at 5306 Camden is in mortgage foreclosure, and the property is now in the hands of GE Capital Mortgage. Staff has been in contact with the mortgage holder's legal counsel since February 1997. The mortgagee's period of redemption expired in April 1997, and legal counsel for GE Capital has indicated an interest in negotiating a sale of the 5306 Camden Avenue property prior to an eminent domain taking by the EDA. The property at 5306 Camden is included in the eminent domain action filed for the remaining 53rd Avenue ro erties and the ED p p A will take title to the property on June 17, 1997, as part of the eminent domain action. Any negotiated sale of the property must occur before June IT Legal counsel for the mortgage holder has indicated GE Capital has "market information" that would support a value of $76,900 for the property at 5306 Camden. The EDA's appraisal of the property is $52,000, and staff believes the $76,900 value is an unrealistic figure not supported by actual market data. The mortgage holder's legal counsel has indicated the mortgage payoff on the property is $60,072.59. Staff has offered $55,000 to the mortgage holder for the property contingent on EDA approval. The litigation costs of the eminent domain action on this property will likely exceed $3,000. As of the date of this memorandum, legal counsel for the mortgage holder has not responded to the offer. The attached resolution would rovide EDA approval p of the $55,000 offer for the property. Commissioner introduced the following resolution and • moved its adoption: EDA RESOLUTION NO. RESOLUTION AUTHORIZING ADMINISTRATIVE SETTLEMENT FOR ACQUISITION OF PROPERTY IN THE 53RD AVENUE DEVELOPMENT AND LINKAGE PROJECT WHEREAS, EDA Resolution No. 97 -03 established a just compensation for various properties located in the 53rd Avenue Development and Linkage Project; and WHEREAS, EDA Resolution No. 97 -03 established just compensation for the property located at 5306 Camden Avenue North, legally described as Lot 12, Block 2, Bellvue Acres, that part lying south of north 62 feet (the "Property") at $52,000; and WHEREAS, the owner of 5306 Camden Avenue North (the "Property") is deceased and the property is in foreclosure to GE Capital Mortgage; and WHEREAS, the EDA has commenced an action in eminent domain, filed in Hennepin County District Court as Case No. CD -2444 (the "Action "), the purpose of which is to acquire fee simple title to certain lands, including the Property, for redevelopment purposes; • and WHEREAS, the Brooklyn Center EDA desires to expedite the acquisition of the Y P q Property; and WHEREAS, the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 as amended (Uniform Relocation Act), allows the acquiring agency to provide for an administrative settlement which would allow the Brooklyn Center EDA to increase the offer of just compensation; and WHEREAS, the Brooklyn Center EDA has offered the mortgagor an additional $3,000 over the appraised value of $52,000 for the property; and WHEREAS, acquiring the property through negotiated sale avoids the cost of litigation associated with the eminent domain taking, which costs staff estimates to be in excess of $3,000. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center that the offer of just compensation made to the owner of 5306 Camden Avenue North, as part of the acquisition of properties in the 53rd Avenue Development and Linkage Project, is hereby increased from $52,000 to $55,000. • EDA RESOLUTION NO. BE IT FURTHER RESOLVED that the EDA Executive Director is hereby authorized to execute all necessary closing documents to acquire the property at 5306 Camden Avenue North. 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. • CON PI OF NTI Memorandum qt To: Michael J. McCauley, City Manager From: Tom Bublitz, Community Development Specialis % Date: June 4, 1997 Subject: Resolution Approving Relocation Claim for Property in the 53rd Avenue Development and Linkage Project The information in this memorandum and accompanying resolution is confidential and should not be made available to the general public. The property at 5311 -4th Street North has been appraised at $79,000. This is one of the higher valued properties in the 53rd Avenue Development and Linkage Project. The $79,000 value established by the EDA's appraiser is comprised of $75,500 for the house and lot and $3,500 additional for the oversized lot. The lot is 63' x 275' for a total of 17,325 square feet. The value of $3,500 is attributed to the oversized lot at 5311 -4th Street North when compared to smaller lots of comparable dwellings. For purposes of establishing the relocation comparable, this $3,500 excess lot value is "carved out" from the $79,000 total property value so that $75,500 ($79,000 less $3,500) is used to establish a replacement housing comparable. • The replacement housing payment for this property has been established at $24,400. In other words, the value of the replacement housing "comparable dwelling" for 5311 -4th Street North has been established at $99,900 ($99,900 less $75,500 equals $24,400). The owner of 5311 -4th Street North has indicated he has had difficulty in finding a replacement home which will meet his needs, including an oversized lot similar to the one at 5311 -4th Street North. The owner has appealed the comparable replacement housing payment established for his property. The owner of 5311 -4th Street North has obtained his own independent appraisal of the property. The owner's appraisal shows a value of $100,500 for the property, with $18,000 of this total attributed to the oversized or extra lot. While staff believes the $100,500 value with $18,000 attributed to the extra land value is unrealistic, there may be some basis for reexamining the "carve out" adjustment for the oversized lot. Ms. Sandra Luegge of Evergreen Land Service Company has reviewed the documents and issues relative to Mr. Olsen's appeal of the replacement housing comparable, and has recommended an adjustment of the "carve out" of $6,000. A copy of Ms. Luegge's letter to me dated June 3, 1997, and describing her analysis, is included with this memorandum. A brief summary of the calculations relative to this adjustment, is shown by the following: • Memorandum to Michael J. McCauley • June 4, 1997 Page 2 $79,000 Appraised value of proprety Less: 9.500 "Carve out" adjustment for excess land ($3,500 plus additional $6,000) $69,500 Adjusted value of property $99,900 Market value of comparable Less: 69.500 Replacement home $30,400 Replacement housing payment Based on the unique features of this particular property and the cost of litigation associated with an eminent domain taking, staff recommends the revised replacement housing payment of $30,400 be accepted and the resolution be approved. • • --U00— C:CURG�.iY J Lr'd`iL GI[ V ri -il7L Cl L EVERGREEN LAND SERVICES CO. • 6110 BLUE CIRCLE DRIVE, SUITE 140 MINNETONKA, MN 55343 Office (612)- 930 -3100 Fax (612) -935 -0862 June 3, 1997 Mr. Tom Bublitz Community Development Specialist City/EDA of Brooklyn Center 6301 Shingle Creek Parkway Brooklyn Center, MN 55430 IN RE: Gordon Olsen, Homeowner- Occupant, 53114th Street, Brooklyn Center Reconsideration of Replacement Housing Benefits Dear Mr. Bublitz: This letter is a follow -up to the meeting which I had with you, Brad Hoffman, and Mike McCauley regarding Gordon Olsen. Previous to our meeting, the City staff had met with Mr. Olsen in a "preliminary" appeal setting to hear Mr. Olsen's concerns regarding his replacement housing benefits. As directed by the City staff, I have reconsidered Mr. Olsen's comparable housing study, including the "carve -out" addressing the excess land and site improvements of the project site which was applied to the City's appraised/offer price for Gordon's project property. In this reconsideration, I have reviewed the appraisal which Mr. Olsen presented to the City staff and the land values included therein. I have also re- reviewed the City's appraisals of the Olsen parcel and the McNally parcel, both of which had extraordinarily large lots and major landscaping that resulted in the need for a "carve -out" adjustment to be made when comparing the project sites to the comparable housing. The result of these reviews is my recommendation that the City/EDA of Brooklyn Center consider increasing the amount of value applied to Gordon Olsen's project site excess land/site improvements by $6,000. This would result in a maximum replacement housing price differential benefit to which Mr. Olsen may be entitled of $30,400. Please feel free to contact me if you have any questions regarding this recommendation. Sincerely, ® ands G. Luegge Relocation SpecialisvDirector Successfully serving our ctle�tS for 25 years 1972 -1991 Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION APPROVING RELOCATION CLAIM FOR PROPERTY IN THE 53RD AVENUE DEVELOPMENT AND LINKAGE PROJECT WHEREAS, EDA Resolution No. 96 -33 authorizes acquisition, establishes offer of just compensation, authorizes negotiation and execution of purchase agreement, authorizes payment for acquisition, closing costs and relocation claims for various properties located in the 53rd Avenue Development and Linkage Project; and WHEREAS, EDA Resolution No. 96 -33 includes the property at 5311 -4th Street North, legally described as the south 1 /2 of Lot 9, Block 2, Bellvue Acres (the "Property "), and located in the 53rd Avenue Development and Linkage Project area; and WHEREAS, Evergreen Land Services Company, which is providing acquisition and relocation services for the EDA in the 53rd Avenue Development and Linkage Project, has performed a comparable housing analysis for purposes of establishing a replacement housing payment in the amount of $24,400 for the property in accordance with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended (Uniform Relocation Act); and WHEREAS, the owner of the property has appealed the replacement housing payment prepared by Evergreen Land Services Company; and WHEREAS, the EDA Executive Director has directed Evergreen Land Services Company to reexamine the comparable housing analysis for the property prepared by Evergreen Land Services Company; and WHEREAS, Evergreen Land Services Company has prepared a revised comparable housing analysis for the property; and WHEREAS, the revised housing analysis prepared by Evergreen Land Services Company has established a revised replacement housing payment of $30,400; and WHEREAS, EDA Resolution No. 96 -33 requires that claims for relocation benefits required by the Uniform Relocation Act duly submitted and in accordance with the requirements of the Uniform Relocation Act may be approved by the EDA Executive Director and paid in accordance with the City's purchasing policy; and WHEREAS, the revised replacement housing payment established for the property • at 5311 -4th Street North, in accordance with the Uniform Relocation Act, is in excess of $25,000; and EDA RESOLUTION NO. WHEREAS, the City's purchasing policy provides that payments in excess of $25,000 must be authorized by the Economic Development Authority Board of Commissioners. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center that the EDA Executive Director is hereby authorized to approve the replacement housing payment to a maximum of $30,400 for the property at 5311 -4th Street North, contingent on the owner of 5311 -4th Street North executing a purchase agreement, prepared by the Brooklyn Center EDA, for the sale of 5311 -4th Street North, Brooklyn Center, Minnesota, in the amount of $79,000 purchase price. 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. •