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HomeMy WebLinkAbout2014 04-28 EDAPEDA MEETING City of Brooklyn Center April 28, 2014 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. March 24, 2014 — Regular Session 4.Commission Consideration Items a. Consideration of Approval of Grant Applications for Contamination Cleanup of the Former Howe Chemical Site Located at 4821 Xerxes Avenue North in Brooklyn Center 1.Resolution Authorizing the Economic Development Authority of Brooklyn Center, Minnesota to Apply for a Contamination Cleanup Grant from the Minnesota Department of Employment and Economic Development Requested Commission Action: —Motion to adopt resolution. 2.Resolution Authorizing the Submission of a Grant Application to the Metropolitan Council for the Tax Base Revitalization Account Requested Commission Action: —Motion to adopt resolution. 3. Resolution Approving an Application for a Hennepin County Environmental Financial Grant Requested Commission Action: —Motion to adopt resolution. EDA AGENDA -2- April 28, 2014 b. Resolution Authorizing the Execution of a Letter of Intent and Exclusive Negotiating Agreement with Ridgecrest Investors, LLC for the Commercial Development of Lot 1, Block 1, Northbrook Center 2nd Addition (Told Development — 57 th and Logan) Requested Commission Action: —Motion to adopt resolution. 5.Public Hearings a. Minnesota Investment Fund (MIF) Grant Authorization 1. Resolution Authorizing the City of Brooklyn Center's Economic Development Authority to Submit a Business and Community Development Application to the Minnesota Department of Employment and Economic Development for a Minnesota Investment Fund (MIF) Grant for the Benefit of Palmer Lake BC, LLC (Sign Zone, Inc.) and the Palmer Lake Plaza Property Located at 6850 Shingle Creek Parkway —This item was published in the official newspaper on April 17, 2014, and is offered this evening for Public Hearing. Requested Commission Action: —Motion to open Public Hearing. —Motion to open take public input. —Motion to close Public Hearing. —Motion to adopt resolution. 6.Adjournment E A Agenda Item No. 3a 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 MARCH 24, 2014 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 8:02 p.m. 2.ROLL CALL President Tim Willson and Commissioners Carol Kleven, Kris Lawrence-Anderson, Lin Myszkowski, and Dan Ryan. Also present were Executive Director Curt Boganey, Director of Business and Development Gary Eitel, and Mary Mullen, TimeSaver Off Site Secretarial, Inc. 3.APPROVAL OF AGENDA AND CONSENT AGENDA Commissioner Ryan moved and Commissioner Myszkowski seconded approval of the Agenda and Consent Agenda, and the following item was approved: 3a. APPROVAL OF MINUTES 1. February 10, 2014 — Regular Session Motion passed unanimously. 4.COMMISSION CONSIDERATION ITEMS 4a. RESOLUTION NO. 2014-04 APPROVING A SECOND AMENDMENT TO DEVELOPMENT AGREEMENT (SHINGLE CREEK CROSSING PROJECT) Executive Director Curt Boganey introduced Director of Business and Development Gary Eitel and invited him to address the EDA. Mr. Eitel reviewed an amendment to the Shingle Creek Crossing Project Development Agreement, which was originally approved by the EDA on May 23, 2011. He added the original agreement identified minimum improvements to be completed by December 31, 2012. Mr. Eitel stated the development agreement included the demolition of the existing mall, excluding the Sears store and Food Court Building. He added the developer was required to complete additional improvements, including the renovation of the Food Court Building, and 03/24/14 -1- DRAFT obtain occupancy for at least 239,000 square feet of the buildings on Phase II Parcels by May 23, 2016. Mr. Eitel stated the second Development Agreement amendment proposes changes to the minimum improvements to be completed by the Developer. He added the amendment obligates the developer to demolish the Food Court Building and replace it with a new retail store. He noted the amendment includes a schedule for completion of the building area replacing the Food Court as well as the release of the second mortgage on the Kohl's Parcel. Commissioner Ryan thanked Mr. Eitel for his presentation. He asked whether the City would give up mortgage value with regard to the release of the second Kohl's mortgage. Mr. Eitel confirmed this. Commissioner Ryan stressed the importance of ensuring that the financial aspects of the development are in the best interests of the City of Brooklyn Center. He added City staff has been diligent in providing useful information in that regard, and he is optimistic about what has been presented. President Willson stated he has heard that Kohl's decided to vacate their property, as the costs of renovation would be prohibitive. He requested that City staff work with the developer to create momentum at the Kohl's site. He added, on a similar note, he recently saw an article that indicated that Sears is looking for a third party vendor to run their auto centers. He added he had provided the article to City staff. Mr. Eitel stated it has been the City's intention to include Sears in the PUD from the very beginning. He added City staff hopes to engage in productive discussions with Sears, which is a positive step. He noted progress on the development site is moving forward, and City staff remains optimistic. President Willson agreed, adding he feels optimistic but hopes that the City can continue to undertake other development projects, such as the Brookdale Square site, as well as the rest of the opportunity site. Mr. Boganey stated the City is sufficiently staffed to move those projects forward. He added he has discussed this with Mr. Eitel, and if there appears to be a need for capacity, it will be addressed. Mr. Boganey stated, with regard to the Kohl's property, the removal of the second mortgage is a significant benefit of this amendment as it creates increased flexibility in terms of redevelopment. President Willson commended Mr. Eitel, Mr. Boganey and City staff for all of their efforts and hard work on this issue. Commissioner Myszkowski moved and Commissioner Kleven seconded adoption of RESOLUTION NO. 2014-04 Approving a Second Amendment to Development Agreement (Shingle Creek Crossing Project). 03/24/14 -2- DRAFT Motion passed unanimously. 5. ADJOURNMENT Commissioner Ryan moved and Commissioner Lawrence-Anderson seconded adjournment of the Economic Development Authority meeting at 8:35 p.m. Motion passed unanimously. 03/24/14 -3- DRAFT EDA Agenda. Item N©0 42 EDA Vi MEMORANDUM DATE: April 28, 2014 TO: Curt Boganey, City Manager FROM: Gary Eitel, Business and Development Director SUBJECT: Consideration of Approval of Grant Applications for Contamination Cleanup of the Former Howe Chemical Site Located at 4821 Xerxes Avenue North in Brooklyn Center Recommendation: It is recommended that the Economic Development Authority of Brooklyn Center, Minnesota (EDA) consider approval of the following resolutions: A.Resolution Authorizing the Economic Development Authority of Brooklyn Center, Minnesota to Apply for a Contamination Cleanup Grant from the Minnesota Department of Employment and Economic Development. B.Resolution Authorizing the Submission of a Grant Application to the Metropolitan Council for the Tax Base Revitalization Account. C. Resolution Approving an Application for a Hennepin County Environmental Financial Grant. Background: This memorandum addresses the proposed environmental remediation and redevelopment of the industrial property located at 4821 Xerxes Avenue North in Brooklyn Center (the Site) and known as the former Howe Chemical Site. With regard to environmental remediation of the Site, the EDA is being asked to apply for grant funding to assist with cleanup of the Site by the new owner, MBC II, LLC (d/b/a Hyde Development). The grant funds are awarded on a competitive basis from the Minnesota Department of Employment and Economic Development (DEED), Metropolitan Council and Hennepin County Department of Environmental Services. The grant mechanisms require that the EDA apply for the grant and be accountable for expenditure of the funds, but MBC II will manage and conduct all the cleanup activities through private contractors and consultants. Essentially, the EDA serves as a pass through of grant funds to MBC II, LLC. The EDA has previously approved the submittal of these 3 grant resolution on three prior occasions April 21, 2010; October 20, 2010; and April 25, 2011. The prior grant applications were determined to be ineligible, pending the necessary approvals by the Minnesota Department of Agriculture. The Department of Agriculture is currently in the process of reviewing the Remedial Investigation Report and Corrective Action Plan which may be completed in time for this grant cycle. -3} Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust EDA ITEM MEMO NDUM Available Contamination Clean Up Grants: The resolutions to be considered by the EDA address three contamination cleanup grant programs. The programs are as follows: Department of Employment and Economic Development (DEED) The Minnesota Contamination Cleanup Grant Program was established in 1993 to clean up contaminated sites and convert contaminated property into a marketable asset. The Department of Employment and Economic Development (DEED) is the administering state agency for the grant program. The DEED grant requires a 25% local match which will be provided by MBC II, LLC ( Hyde Development). •Metropolitan Council Tax Base Revitalization Account (TBRA) Enacted by the Legislature in 1995, the Metropolitan Livable Communities Act designated the Metropolitan Council as the administrator of the Tax Base Revitalization Program. This program makes grants to clean-up contaminated land for subsequent redevelopment, job retention and job growth in areas that have lost some of their commercial industrial base. No local match is required. •Hennepin County Environmental Response Fund (ERF) and Environmental Protection Agency (EPA) Brownfield's Revolving Loan Fund Grants. Hennepin County makes environmental cleanup grants available through its Environmental Response Fund (ERF) grant program. These ERF grants can be used for assessment and or cleanup of contaminated sites located within Hennepin County. In addition to the ERF program, Hennepin County also manages the EPA Brownfield Revolving Loan Fund Grant Program. This is funded by the Federal EPA for the redevelopment of Brownfield's. A "brownfield" is defined as real property, the expansion, redevelopment, or reuse of which may be complicated by the presence of potential hazardous substance, pollutant or contaminant. The program was created by the 2002 Federal Brownfield's Law. No local match is required. Site History The Site at 4821 Xerxes Avenue North was a manufacturer and distributor of custom formulated agricultural fertilizers, insecticides, fungicides, and herbicides going back to 1940. A retail petroleum station was also located at the Site from approximately 1945 to 1970. The Site was owned for many years by the Howe family and operated under the names Howe, Inc. and Howe Chemical Company. Around 1983, the facility was purchased by ConAgra Fertilizer Company, now known as United Agra Products (also known as UAP Distribution, Inc.). The Site operations that came after the Howe ownership included distribution of agricultural fertilizers. A major industrial incident occurred at the Site in 1979 when one of the buildings burned down. The building reportedly contained over 80 tons of 100 different types of pesticides and over 120 tons of bag and bulk fertilizers, all of which burned along with industrial equipment, electrical — Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for people and preserves the public trust EDA ITEM MEMO NDUM equipment, vehicles, maintenance chemicals, wood, metal, batteries, etc., stored within the building. The water used to fight the fire (estimated at 500,000 gallons) drained onto the Site's paved areas and soil where it pooled, as well as ran into storm water catch basins. Site soil and groundwater sampling and analysis subsequent to the fire were performed and elevated concentrations of agricultural chemicals were detected in both the Site soil and ground water. Following the fire, the State of Minnesota assumed control of the investigation and clean-up of the Howe site in Brooklyn Center and selected and implemented two cleanup steps. First, the removal of contaminated soil, ice and snow to agricultural land in Martin County, Minnesota; and second, the pumping of contaminated groundwater "down gradient" from the Howe facility. The second step also involved the State's decision not to further investigate or cleanup any soils on the Howe site itself. Soil excavation was ruled out since it was determined that the pesticides in the soil would eventually infiltrate into groundwater where they could be controlled or removed and because of the amounts present and hydrogeological conditions, remedial action of the Howe site was not thought to be necessary. Current requirements for investigation and cleanup of contaminants on the Site suggest that the initial investigation and cleanup was not adequate. Subsequent to the 1979 fire and initial cleanup, the Site continued in operation as a fertilizer distribution operation. In 1986 the Crop Mate Company, which was a ConAgra affiliate, acquired the site. All Site operations were discontinued in 2006. In 2008, site and building plan approval was granted by the City to RER Acquisitions, LLC for a 50,000 sq. ft. office/warehouse facility. Over the past few years since 2008, RER has been working with the Department of Agriculture (DOA) and Minnesota Pollution Control Agency (MPCA) to establish which State agency had authority to provide oversight relative to the cleanup of The Site. The issue of agency oversight was resolved with the Department of Agriculture having the lead role in a coordinated cleanup program for the Howe Chemical Site Site Clean Up and Proposed Development RER (now known as MBC II, LLC) acquired the Howe site in April 2010 and has enrolled the property in the MPCA's Volunteer Investigation and Cleanup (VIC) program in order to proceed with required cleanup and redevelopment of the Site as per MPCA standards spelled out in work plans approved by the MPCA. RER had also been participating in the AG VIC program for cleanup of contaminants identified as agriculture related; however, RER/MBC II is no longer a participant in this voluntary program. Rather the Ag Department has been working with the Responsible Parties identified to have had agricultural products that stored on site. A mobile testing lab was set up at the site this winter and the Ag Department coordinated a thorough soils investigation of the Howe site and adjacent railroad property known to have been used in the former Howe Fertilizer operation. In addition to defining the volume of the contaminated soils on the Howe Site, the investigation found areas within the adjacent railroad property that had previously been used as disposal sites for the burying of agricultural products. Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust EDA ITEM MEMO ND UM On March 7, 2014, Environmental Scientific, a consultant for the companies identified as the Responsible Parties, submitted a Remedial Investigation Report and Corrective Action Plan for the Howe Site and the adjacent railroad property to the MN Department of Agriculture. The plan specifically identified the perimeter and depth of several areas with levels of contaminated soils to be removed and properly disposed at an approved landfill. It is staff's understanding that approximately 15,000 cubic yards of contaminated soils, (10,000 cubic yards on the Howe site and 5,000 cubic yards on the railroad property) will need to be exported with clean soils imported to balance the grading plans for the planned industrial development of the site. On April 11, 2014, a meeting was held with the Paul Hyde and representatives of Hennepin County, Metropolitan Council, and DEED to review a proposed budget and potential funding sources to clean up the contaminated soils identified on the Howe Site. At this meeting Paul Hyde provided the following information relating to the Ag Department's determination of Responsible Parties and MBC II's relationship with these parties to achieve a coordinated clean up action plan for the Howe Site and adjacent railroad property: Several parties were identified as potentially responsible for contamination at the Site resulting from a fire in 1979 that destroyed a storage and maintenance building and released various pesticide or fertilizer products. After assuming responsibility for the investigation and cleanup of the fire releases, the state sued the Howe Chemical, Inc. and Howe Fertilizer, Inc. as well as Ciba Geigy Corporation, which stored products in the building. On March 6, 1986, the Hennepin County District Court, after settlement of the state's claims, dismissed all state claims against these parties, with prejudice. Subsequently, Howe Chemical Company, Inc. and Howe Fertilizer, Inc. were dissolved and no longer exist. The other parties operating at the former Howe property were the Sipe and Gray Oil Company, which ran a Texaco station and the Minneapolis Sewing Machine Company. These companies are no longer in existence. The Department of Agriculture made it clear in 2011 that it would not talk to MBC II with regards to its planned development or the cleanup of the Howe Site. Accordingly, in 2011 the successor to Howe Fertilizer (ConAgra) and Ciba Geigy (Syngenta) entered into an Environmental Remediation Agreement, whereby ConAgra and Syngenta would agree to serve as the liaison with the Department of Agriculture and MBC II, and would be responsible for paying for all costs of remediation on the Former Howe site. The dollar amounts identified from the various grant programs are as follows: •$580,000 from DEED contamination cleanup grant program. •$370,000 from Metropolitan Council Tax Base Revitalization Account (TBRA) program. •$407,734 from Hennepin County Environmental Response Fund and/or EPA Brownfield's Grant Program. •$333,271 from Developer as a local match for investigation costs •$300,000 from the Developer to provide capping of The Site and also to meet the 25 percent local match funding required by the DEED grant program. •$50.000 from the 2010 DEED Investigation Grant •$50,000 from the 2011 Met Council Investigation Grant. Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for people and preserves the public trust EDA ITEM MEMO NDUM Attached for your reference are three exhibits illustrating the clean-up areas and the proposed budget prepared by MBC II for the Howe Site. At this time, the developer is pursuing the May 1; 2014 Grant Applications with the expectations that Minnesota Agriculture Department will complete their review and provide their approval of the Remedial Investigation Report and Corrective Action Plan prior to the agencies finalizing their selection of candidates for this cycle of grant funds. The developer has indicated that a schedule similar to the 2012 soil correction and construction plans for their development of the former Lifetime Fitness Site would facilitate leasing plans to have the building ready for occupancy in December, 2014. Based on the preliminary leasing contacts, it is estimated that this project will result in the relocation of approximately 100 jobs to the City and the opportunity for the creation of an additional 20-30 new jobs. The City Council approved the initial industrial development plans in 2008 and in 2014, approved an amended to this Industrial PUD that enlarged the building from 51,000 square feet to 60,000 square feet. This office/warehouse building is planned to be identical in appearance to the building constructed by RER (Hyde) directly across Brooklyn Boulevard in Minneapolis. Budget Issues: There are no direct budget impacts to consider since Hyde Development will provide the local match for the DEED grant and the various grant agencies will provide all funding for contamination cleanup, including demolition of the buildings on the site. Presently, the EDA's budget impact will be the staff time necessary to monitor the grants, process payment requests to RER's contractors performing grant related work and maintain the required financial records for the various funding agencies. Strategic Priorities: Focused Redevelopment Mission: Ensuring an attractive, clean, safe, inclusive connnunhy that enhances the quality of life for all people and preserves the public trust Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION AUTHORIZING THE ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER, MINNESOTA TO APPLY FOR A CONTAMINATION CLEANUP GRANT FROM THE MINNESOTA DEPARTMENT OF EMPLOYMENT AND ECONOMIC DEVELOPMENT WHEREAS, RER Acquisitions, LLC is the owner of certain real property located at 4821 Xerxes Avenue North in Brooklyn Center, known as the former Howe Chemical Site (the Site); and WHEREAS, the Economic Development Authority of Brooklyn Center, Minnesota (EDA) believes it is in the best interest of the City of Brooklyn Center to encourage the environmental cleanup and redevelopment of the Site; and WHEREAS, the EDA desires to facilitate the cleanup and redevelopment of the Site by RER Acquisitions, LLC; and WHEREAS, the redevelopment of the Site meets the redevelopment objectives of the City's modified redevelopment plan (The "Redevelopment Plan") for Housing Development and Redevelopment Project No. 1 (The "Redevelopment Project Area") as adopted on December 19, 1994 by the EDA; and WHEREAS, the EDA has the legal authority to apply for financial assistance, and the institutional, managerial and financial capability to insure adequate project administration. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority of Brooklyn Center, Minnesota as follows: O The EDA approves the contamination cleanup grant application submitted to the Department of Employment and Economic Development on May 1, 2014 by the EDA for the Howe Chemical site. O The EDA is authorized to act as the legal sponsor for Project (s) contained in the Contamination Cleanup Grant Program to be submitted on May 1, 2014 and that the EDA Executive Director is hereby authorized to apply to the Department of Employment and Economic Development for funding of this project on behalf of the EDA. O The EDA has the legal authority to apply for financial assistance and the institutional, managerial and financial capability to insure adequate project administration. O The sources and amounts of the local match identified in the application are committed to the Project identified. •The EDA has not violated any federal, state or local laws pertaining to fraud, bribery, graft, kickbacks, collusion, conflict of interest or other unlawful corrupt practices. •Upon approval of its application by the State, the EDA may enter into an agreement with the State of Minnesota for the above referenced Project(s) and that the EDA certifies that it will comply with all applicable laws and regulations as stated in all contract agreements. . •The EDA Executive Director is hereby authorized to execute such agreements as are necessary to implement the project on behalf of the applicant. April 28, 2014 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. Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION AUTHORIZING THE SUBMISSION OF A GRANT APPLICATION TO THE METROPOLITAN COUNCIL FOR THE TAX BASE REVITALIZATION ACCOUNT WHEREAS, The City of Brooklyn Center is a participant in the Livable Communities Acts Local Housing Incentives Account Program, as determined by the Metropolitan Council, and is therefore eligible to make application for funds under the Tax Base Revitalization Account; and WHEREAS, the City, through its Economic Development Authority (EDA) has identified a contamination cleanup project within the City that meets the Tax Base Revitalization Account's purpose and criteria; and WHEREAS, the Economic Development Authority of Brooklyn Center, Minnesota (EDA) has the institutional, managerial and financial capability to insure adequate project and grant administration; and WHEREAS, the EDA certifies that it will comply with all applicable laws and regulations as stated in the contract grant agreements; and WHEREAS, the EDA finds that the required contamination cleanup will not occur through private or other public investment within the reasonable foreseeable future without Tax Base Revitalization Account grant funding; and WHEREAS, the EDA represents that it has undertaken reasonable and good faith efforts to procure funding for the activities for which Livable Communities Act Tax Base Revitalization Account funding is sought but was not able to find or secure from other sources funding that is necessary for clean-up completion and states that this representation is based on the following reasons and supporting facts: •No local funds are available to fund the proposed cleanup activities, including General Fund and Special Revenue Funds of the City and/or EDA. •State Department of Agriculture Cleanup Funds are not available for the proposed cleanup activities at the Site. •Proposed cleanup activities at the Site do not qualify for Minnesota Petrofimd funding. •Tax Increment Finance funding is not available for cleanup activities at the site. NOW THEREFORE BE IT RESOLVED by the Economic Development Authority of Brooklyn Center, Minnesota that it acknowledges it will be the grantee and agrees to act as legal sponsor administer and be responsible for grant funds expended for the project contained in the Tax Base Revitalization grant application submitted on May 1, 2014; and BE IT FURTHER RESOLVED that the EDA Executive Director is hereby authorized to apply to the Metropolitan Council for this funding on behalf of the Economic Development Authority for Brooklyn Center, Minnesota and to execute such agreements as are necessary to implement the Project on behalf of the applicant. April 28, 2014 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. Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION APPROVING AN APPLICATION FOR A HENNEPIN COUNTY ENVIRONMENTAL FINANCIAL GRANT WHEREAS, an application requesting grant funds from the Hennepin County Department of Environmental Services has been prepared for submission by the Economic Development Authority of Brooklyn Center, Minnesota (EDA); and WHEREAS, the grant funds will be used for environmental cleanup of the former Howe Chemical Site located at 4821 Xerxes Avenue North in Brooklyn Center. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority of Brooklyn Center, Minnesota (EDA) that the EDA supports the Environmental Financial Grant Application submitted to the Hennepin County Department of Environmental Services on May 1, 2014, by the EDA for the former Howe Chemical Site located at 4821 Xerxes Avenue North in Brooklyn Center. April 28, 2014 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. t P —__ ---------- ) 1 I ..., LA i 1 I' f3-3:.:1 j , I \ , :hill!! ilti ' I ) I I I I) l ■ ,\ % \ \ _ ,------------ \ ..„-------"------- 1 n , ft I ) )-' -i I I LI A !): r? 6 LI 6 5• Former Howe Fetilizer Site Cleat_ u_ et Uses Phase I ESA $4,800 VIC Investigation / RAP - Completed $135,650 AG Investigation/CAP - Completed $303,150 VIC RAP Modification - Completed $18,000 Soils Cleanup/Removal $798,480 Vapor Barrier & Vent System $138,900 Demo/Abatement $216,925 Well Abandonment $25,900 Well Construction $8,000 Quarterly S&A / Closure $76,000 Well Survey / Abandonment $16,700 Soil/Groundwater Closure Report - AGVIC $3,000 Site Cap $300,000 RAP Implementation Rpt $21,000 lVfPCA Oversight to Date - Completed $17,500 1■APCA Oversight expected $7,000 Total $2,091,005 Sources Percentage 2010 DEED Invtgn grant $50,000 2.39% 2011 Met C Invtgn grant $50,000 2.39% DEED-May 2014 $580,000 27.74% Henn Cty - May 2014 $407,734 19.50% Met C - May 2014 $370,000 17.69% Developer local match - Invtgn $333,271 15.94% Developer local match - Cap $300,000 14.35% Total $2,091,005 Z CG -o ,e.5 gIS T. 5 •••.o o!, <TV;tit Poqi I - :::-/e:, I ::Thc,' 2 • , ;_'' '.; I-0-' '11 z l ,'4L. t •-. -1' Z-'' t-n-i., -$,.',-, 1 ' ..------- ..7 3,:., ,,,, b •. ..T. n_.-, ,/...g -..c ,i ----.■'-'.‘7" [6). 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SUBJECT: Resolution Authorizing the Execution of a Letter of Intent and Exclusive Negotiating Agreement with Ridgecrest Investors, LLC for the Commercial Development of Lot 1, Block 1, Northbrook Center 2 nd Addition (Told Development — 57 th & Logan) Recommendation: It is recommended that the Economic Development Authority consider approval/adoption of the Resolution Authorizing the Execution of a Letter of Intent and Exclusive Negotiating Agreement with Ridgecrest Investors, LLC for the Commercial Development of Lot 1, Block 1, Northbrook Center 2' Addition (Told Development — 57 th & Logan) Background: The February 24, 2014 City Council Work Session included a discussion on the option of the EDA entering into a Letter of Intent and Exclusive Negotiating Agreement with Ridgecres Investors, LLC (Told Development) for the commercial development of Lot 1, Block 1, Northbrook Center 2 nd Addition (the 57 th & Logan site). The City Council reviewed a conceptual development plan which illustrated five potential commercial pad sites with the following potential uses: •A 16,000 sq. ft. anchor tenant on a 2.5 acre site (corner of 57 th Ave. & Logan) with the following uses identified: grocery/gas station/anchor retail; •A 2,500 sq. ft. food/retail building on a 1 acre lot south of the Excel Energy transmission tower (corner of Hwy 100 & 57 th Ave); •A 2,500 sq. ft. food/retail building on an 1 acre lot north of this transmission tower fronting on Highway 100. •A 6,600 sq. ft. retail building on a 1.05 acre site that faces the central portion of the site and located north of an internal access drive that aligns with the overhead transmission easement; •A 14,000 sq. ft. building pad on 2.4 acres within the northern portion of the site identified as a potential hotel/office/medical use. The developer envisions a commercial development that would provide opportunities for a neighborhood center catering to nearby residents, as well as the freeway traffic driving by the site on a daily basis. The Shops of Wedgwood, a commercial PUD being completed by the Developer in the City of Maple Grove (NW quadrant of Bass Lake Road and 1-494) have been Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust t3A -r-lEIVf MEMORANDUM provided to illustrate the types of exterior finishes, quality, and character of their development vision for the site. The Council discussed a draft Letter of Intent that included the following major components: a purchase price of $1,800,000; the buyer/developer will receive all Government approvals to complete an approved commercial development of the site; the buyer/developer has a six month (180 day) period, referenced to as the Tenant Development Period, to secure a commitment from a pharmacy, grocery store, or a nationally recognized retail tenant that will occupy at least 12,000 sq. ft. of retail space on the land that is acceptable to the Seller; if the buyer/developer is unable to secure such a commitment either party may terminate the Development Agreement after the Tenant Development Period; a condition of the EDA's conveyance will include the provision that an approved Development Agreement will generally describe the acceptable development of the land; the Seller/EDA warrants that there are no wells on the land, there are no underground storage tanks on the land, and to the best of the Seller's knowledge, there are no environmental or human hazards on the land; a closing date on or before August 30, 2014. The consensus of the City Council/EDA was to find that the conceptual development plan, as submitted by Told Development, is consistent with its development vision for this site and to direct staff to proceed with a Letter of Intent and Exclusive Negotiating Agreement with Ridgecrest Investors, LLC for the commercial development of Lot 1, Block 1, Northbrook Center 2 nd Addition (Told Development — 57 th and Logan). Attached for your reference is a copy of the February 24, 2014 Council Work Session Minutes and the staff memorandum that was presented at that time. Letter of Intent and Exclusive Negotiating Agreement: The Letter of Intent provides for the developer with an option to acquire the 57 th & Logan Avenue site, identified as Lot 1, Block 1, Northbrook Center 2 nd Addition, for the purchase price of $1,800,000 and includes the general framework for the drafting of a development agreement that would include a purchase agreement. Note: Oudot A of this plat, the triangular tip of the site lying north of the intersection of Logan & 58 th Avenue is approximately 1/2 acre in size and was intentional omitted from the current negotiations to enable the MPCA to complete their ground water monitoring associated with finalizing the Dry Cleaning Vapor Study and Environmental Clean Up actions. The Letter of Intent has 3 time frames: Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust EDA ITEM MEMO A NDUM First, a 60 day exclusive negotiating period during which the EDA will not initiate, solicit, encourage (directly or indirectly), or accept any offer or proposal for all or any substantial part of the land. The exclusive negotiating rights would be in effect through July 1, 2014. Second, the Tenant Development Period provides up to 180 days for the developer to secure a commitment from a pharmacy, grocery store, or a nationally recognized retail tenant that will occupy at least 12,000 sq. ft. of retail space on the land that is acceptable to the EDA. This time period is scheduled until August 30, 2014. During this time period, a development agreement will be prepared that will include a purchase agreement and the conditions and requirements relating to approval of site development plans. Third, a closing date on or before November 30, 2014, has been established which allows 90 days from the completion of the Tenant Development Period to satisfy the conditions of the development agreement. Staff will continue to work with the developer in their search for an anchor tenant and the subsequent preparation of a development agreement that will meet their development schedules and achieve the character and quality of development envisioned for this site. Budget Issues: The 57 th & Logan Site was acquired with TIF funds from the Tax Increment District No. 3. The proceeds from the future sales of this property will be considered tax increment and available for other eligible TIF 3 budget expenditures or debt service. Strategic Priorities: • Focused Redevelopment Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION AUTHORIZING THE EXECUTION OF A LETTER OF INTENT AND EXCLUSIVE NEGOTIATING AGREEMENT WITH RIDGECREST INVESTORS, LLC FOR THE COMMERCIAL DEVELOPMENT OF LOT 1, BLOCK 1, NORTHBROOK CENTER 2 ND ADDITION (TOLD DEVELOPMENT — 57 TH & LOGAN) WHEREAS, Ridgecrest Investors, LLC (d/b/a Told Development Company) have expressed an interest in the commercial development of Lot 1, Block 1, Northbrook Center 2 'd Addition; and WHEREAS, on February 24, 2014, the EDA reviewed a draft Letter of Intent and conceptual development plans submitted by Ridgecrest Investors, LLC which illustrated 5 potential building sites with the following potential uses identified: 0 A 16,000 sq. ft. anchor tenant on a 2.5 acre site (corner of 57 th Ave. & Logan) with the following uses identified: grocery/gas station/anchor retail; •A 2,500 sq. ft. food/retail building on a 1 acre lot south of the Excel Energy transmission tower (corner of Hwy 100 & 57 th Ave); O A 2,500 sq. ft. food/retail building on an 1 acre lot north of this transmission tower fronting on Highway 100. o A 6,600 sq. ft. retail building on a 1.05 acre site that faces the central portion of the site and located north of an internal access drive that aligns with the overhead transmission easement; O A 14,000 sq. ft. building pad on 2.4 acres within the northern portion of the site identified as a potential hotel/office/medical use.; and WHEREAS, the EDA finds the design of the conceptual development plans to be consistent with the development visions for this site. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center that the President of the EDA and its Executive Director are hereby authorized to execute the Letter of Intent and Exclusive Negotiating Agreement with Ridgecrest Investors, LLC for the Commercial Development of Lot 1, Block 1, Northbrook Center 2 nd Addition (Told Development — 57 th & Logan). April 28, 2014 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. LETTER OF INTENT AND EXCLUSIVE NEGOTIATING AGREEMENT FOR DEVELOPMENT This Letter of Intent and Exclusive Negotiating Agreement is made as of the day of , 2014 by and between Ridgecrest Investors, LLC (d/b/a TOLD Development Company), a Minnesota limited liability company ("Buyer"), and the Brooklyn Center Economic Development Authority, a Minnesota public corporation ("Seller"). The purpose of this Letter of Intent and Exclusive Negotiating Agreement ("LOT") is to set forth certain nonbinding understandings and certain binding agreements for the preparation of a Development Agreement and for the purchase and development of vacant land. 1.Seller. Economic Development Authority of Brooldyn Center, Minnesota ("EDA" or "Seller"), 6301 Shingle Creek Pkwy, Brooldyn Center, MN 55430. 2.Buyer. Ridgecrest Investors, LLC (d/b/a TOLD Development Company), a Minnesota limited liability company. 3.Scope of Sale. Buyer intends to purchase the Land described as Lot 1, Block 1, Northbrook Center 2"d Addition, comprised of approximately 7.00 acres (the "Land"). 4.Price and Terms. Buyer and Seller envision that the principal terms of the Development Agreement will be substantially as follows: a.Assets to be Acquired. Buyer will purchase the Land only with all easements and accesses thereto. Seller will convey marketable title to the Land. b.Liabilities to be Assumed. No liabilities will be assumed by Buyer. All the liabilities, other than those specifically mentioned herein or in the Development Agreement, shall be paid in full by the Seller. c.Consideration. Buyer shall deposit Earnest Money in the amount of Ten Thousand and No/100 Dollars ($10,000.00) in an escrow account with Old Republic Title Insurance Company. Earnest Money shall be refundable if Buyer cancels the Development Agreement in accordance with its terms. The aggregate consideration for the Land to be purchased shall be One Million Eight Hundred Thous and and No/100 dollars ($1 , 8 0 0,0 00 . 0 0), hereinafter "Purchase Price". d.Contingencies. The sale and purchase will be subject to the following contingencies, which may be modified by the mutual consent of the parties: i. Government Authority. Buyer will have been granted all permits, variances or other authorization needed to complete and/or operate the project. 1 432314v1 BR305-122 Financing. Buyer will have provided Seller with a copy of its financing commitment. Board/Council Authorization. Both Buyer and Seller will provide to the other corporate resolution or other evidence of authority, authorizing the purchase and sale. iv.During the first 180-day period after the effective date of the Development Agreement (the "Tenant Development Period"), Buyer will endeavor to secure a commitment from a nationally recognized retail tenant that will occupy at least 12,000 square feet of retail space on the Land and that is acceptable to Seller. If Buyer is unable to secure such a commitment either party may terminate the Development Agreement after the Tenant Development Period. v.Upon notification from Buyer that a nationally recognized retail tenant has made such a commitment, Buyer will promptly develop plans for development of the Land and make application for all zoning and land use approvals needed for its proposed development of the Land. Such plans are subject to approval by both the Seller and the City of Brooklyn Center (the "Development Plans"). Buyer will secure approval of all Development Plans within 90 days of the end of the Tenant Development Period. vi. Within 30 days of approval of all Development Plans, but no later than the date specified in paragraph 10, the parties will close the sale. e.Deed. The Deed conveying marketable title will be conveyed to Buyer at Closing. f.The Development Agreement will generally describe acceptable development of the Land. g.The Development Agreement will require that the Land be developed in accordance with plans approved by the Seller. Conveyance of the Land will be subject to covenants assuring that the Land will be developed in accordance with plans approved prior to closing or as later amended by mutual consent of the parties. The Development Agreement will include development of the Land that includes at least one nationally recognized retail tenant that is acceptable to Seller occupying at least 12,000 square feet. Seller will advise Buyer whether any proposed retail tenant is acceptable upon request. h.The Seller and Buyer will prorate taxes to date of closing. Seller will pay all levied or pending Special Assessments or other levies prior to closing. 2 432314v1 BR305-122 Seller will warrant that there are no wells on the Land; there are no underground storage tanks on the Land; and, to the best of Seller's knowledge, there are no environmental or human hazards on the Land. Seller will provide copies of all information relating to the Site from Seller's files including but not limited to surveys, soil conditions, environmental reports, plans for buildings, specifications, and geotechnical information. Additionally, Seller will provide Buyer with copies of all agreements with governmental authorities, easements, existing lease or other agreements that will affect or encumber the Site before or after a closing. 5.Government Review and Approval. Development of the Land will require public hearings for the sale of the property and land use approvals and site and building plan review. The City and the EDA will conduct public hearings and give full and fair consideration to the matters brought before them. Nothing in this Letter of Intent or the Development Agreement will require the approval of any application required for the development by the City or the EDA that is contrary to law or to the exercise of discretion by the City Council or the EDA as they deem appropriate in the best interest of the public at large. 6.Due Diligence Review. Promptly following the execution of the Development Agreement, Seller will allow Buyer to complete an examination of the Land, surveys, soils, environmental reports, plats, title, utilities and other legal documents as necessary and upon request of Buyer to complete due diligence. The parties will cooperate to complete due diligence expeditiously. 7.Termination. Prior to execution of a Development Agreement the Buyer may terminate this agreement upon written notice to the Seller. 8.Definitive Development Agreement. All of the terms and conditions of the proposed transaction will be stated in the Development Agreement, to be negotiated, agreed and executed by Buyer and Seller. Neither party intends to be bound by any oral or written statements nor any correspondence concerning the Development Agreement arising during the course of negotiations, notwithstanding that the same may be expressed in terms signifying a partial, preliminary or interim agreement between the parties. 9.Development Agreement. All parties will use all reasonable efforts to complete and sign the Development Agreement before August 30, 2014. 10.Closing. Closing will occur on or before November 30, 2014. 11.Expenses. Each Party will pay their respective legal, accounting, underwriting, appraisal or other expenses incident to this Letter of Intent, the Development Agreement and the transactions contemplated hereby and thereby. 12.Exclusive Negotiating Rights. In order to induce Buyer to commit the resources, forego other potential opportunities, and incur the legal, accounting and incidental expenses 3 432314v1 BR305-122 necessary properly to evaluate the possibility of acquiring the Land, and to negotiate the terms of, and consummate, the transaction contemplated hereby, Seller agrees that for a period of sixty (60) days after the date hereof, Seller and its respective officers, directors, employees, agents, and brokers shall not initiate, solicit, encourage, directly or indirectly, or accept any offer or proposal for all or any substantial part of the Land. 13.Miscellaneous. This Letter of Intent shall be governed by the laws of the State of Minnesota. This Letter of Intent constitutes the entire understanding and agreement between the parties hereto and their affiliates with respect to its subject matter and supersede all prior or contemporaneous agreements, representations, warranties and understandings of such parties (whether oral or written). No promise, inducement, representation or agreement, other than as expressly set forth herein, has been made to or by the parties hereto. This Letter of Intent may be amended only by written agreement, signed by the parties to be bound by the amendment. Evidence shall be inadmissible to show agreement by and between such parties to any term or condition contrary to or in addition to the terms and conditions contained in this Letter of Intent. This Letter of Intent shall be construed according to its fair meaning and not strictly for or against either party. 14.No Binding Obligation. Except for Section 12, this Letter of Intent does not constitute or create, and shall not be deemed to constitute or create, any legally binding or enforceable obligation on the part of either party to this Letter of Intent. No such obligation shall be created, except by the execution and delivery of the Development Agreement containing such terms and conditions of the proposed transaction as shall be agreed upon by the parties, and then only in accordance with the terms and conditions of such Development Agreement. RIDGECREST INVESTORS, LLC BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY By: By: Its Chief Manager Its President And by: Its Executive Director 4 432314v1 BR305-122 EDA ITEM MEMO NDUM Minutes from the City Council Study Session/Work Session February 24, 2014 DISCUSSION OF WORK SESSION AGENDA ITEMS AS TIME PERMITS DISCUSSION REGARDING A LETTER OF INTENT AND EXCLUSIVE NEGOTIATING AGREEMENT WITH RIDGECREST INVESTORS, LLC FOR THE COMMERCIAL DEVELOPMENT OF LOT 1, BLOCK 1, NORTHBROOK CENTER 2 ND ADDITION (TOLD DEVELOPMENT — 57 TH AND LOGAN) Director of Business and Development Gary Eitel reviewed that in 2013 staff met with Jeff Budish of CBRE and Trent Mayberry of Told Development to discuss the potential interest of Told Development in the acquisition of the Brookdale Square site and partnering with the EDA on a mixed use residential and commercial development, similar to their Excelsior and Grand projects in St. Louis Park. Mr. Eitel explained at that time, Told Development expressed reservation with taking on an additional residential project but were very interested in pursuing the potential commercial development of the 57 th and Logan Avenue site as there were similarities with this eight acre site to The Shops of Wedgewood that they were completing in the City of Maple Grove (northwest quadrant of 1-494 and Bass Lake Road). Mr. Eitel displayed a slide of the subject site and described the location of Lot 1, Block 1 that is under discussion. Mr. Eitel stated their interest had been spearheaded because a national user was looking at Brooklyn Center; however, the name of that company was confidential at that time. He stated Told Development was provided with a copy of the City's Development Guidelines and a draft Letter of Intent using standard commercial language. That Letter of Intent has been reviewed by City Attorney LeFevere. Mr. Eitel explained that as the Letter of Intent evolved, the confidentiality of the national user went away so Told Development was more comfortable with pursuing a Development Agreement. Mr. Eitel displayed a slide of the 8.5-acre PUD project and described the types of uses that it would include a Hilton Garden Jim, two multi-tenant commercial buildings, Fairview Clinic, and a CVS Pharmacy. Mr. Eitel also displayed graphics of the Shops at Wedgwood located in the City of Maple Grove, noting it is an attractive design including exterior brick treatments. Mayor Willson asked about the electrical line easement and if the utility company supported construction of an access road. Mr. Eitel described the location of that Xcel Energy transmission line, noting it is an overhead line so Xcel Energy does do not object. Mr. Eitel presented the terms of the Letter of Intent and Exclusive Negotiating Agreement. There was discussion on the position of the MPCA. Mr. Boganey stated staff is confident there are no environmental issues with this particular property that would preclude its development. He stated when this property was subdivided; staff assured the lower portion had no indication of Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust EDA ITEM MEMO NDUM contamination on that site. Mr. Boganey stated that documentation will be provided to the developer. Mr. Eitel asked the City Council whether it found the conceptual development plan, as submitted by Told Development, to be consistent with its development vision for this site. He asked the City Council to provide direction regarding proceeding with a Letter of Intent and Exclusive Negotiating Agreement with Rid ecrest Investors, LLC for the commercial development of Lot 1, Block 1, Northbrook Center 2 11 Addition (Told Development — 57 th and Logan). Mayor Willson stated he has no problem with the proposed user for the 16,000 sq. ft. pad. He asked about users for the other pads and whether there is a finite time to fill those pads. He explained the Development Agreement would be broken down into phases with the anchor tenant within Phase One as it will drive this development. Mayor Willson noted that control is lost if the property is sold outright and asked how the EDA can assure the project proceeds. Mr. Boganey stated that should be addressed in the Development Agreement, noting it may be a subject of contention/negotiation but the EDA has final control as it can decide whether or not to sell the property. He explained the need to balance the interests of the City (the property being back on the tax rolls, development commencing) against the City's desire to assure the property becomes fully developed over a period of time. Mayor Willson stated this is a concern of the City Council and asked staff to assure it is addressed. He asked if there is an opportunity for recourse should only the anchor be constructed. He also asked if that should occur, could the land then revert back to the EDA. Mr. Boganey stated that point would have to be negotiated with the developer. Mayor Willson noted that Embassy Suites was required to return a second parcel when it failed to construct the walkway. He suggested consideration of a similar restriction with Told Development. Councilmember Ryan agreed that the City needs to negotiate a desirable position so there are conditions/guarantees the developer will pursue the rest of the site. Mr. Eitel noted the developer makes money by constructing buildings and it is thought the anchor tenant will drive this project. He stated staff will assure, through the Development Agreement, that the City's interests are protected. Councilmember Ryan stated he is also concerned with the properties on the other side of Logan Avenue (side bungalows). Mr. Eitel stated that will be addressed by orienting the center building towards the center of the project. In addition, there will be sufficient boulevard area. Discussion of this item continued and reached conclusion at the February 24, 2014 Work Session. Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for people and preserves the public trust EDA ITEM MEMO NDUM DISCUSSION REGARDING A LETTER OF INTENT AND EXCLUSIVE NEGOTIATING AGREEMENT WITH RIDGECREST INVESTORS, LLC FOR THE COMMERCIAL DEVELOPMENT OF LOT 1, BLOCK 1, NORTHBROOK CENTER 2 ND ADDITION (TOLD DEVELOPMENT — 57TH AND LOGAN) - continued Mayor/President Willson stated his support for the conceptual development plan as submitted by Told Development. Councilmember/Commissioner Myszkowski agreed and stated she finds it to be consistent with the EDA's development goals. Councilmember/Commissioner Lawrence-Anderson stated support for the development plan but expressed concern relating to the user of Lot 2 (grocery, gas station, retail) because there is a gas station across the street. Mayor/President Willson agreed that is an issue with some redevelopments but if the City is going to allow the marketplace and redevelop underutilized properties; it has to consider uses that developers recommend. He noted the City cannot hold up redevelopment of property based on there being a gas station across the street. City Manager Boganey stated if the developer is not able to secure the major tenant, the project will probably not move forward. He stated the developer will probably look at what has worked in other developments. Councilmember/Commissioner Kleven stated in the past this was a busy spot and the neighborhood had welcomed the pharmacy and small restaurant (Chuck Wagon). She stated support for the proposed development plan. Councilmember/Commissioner Ryan stated he found the conceptual development plan to be consistent with the City Council's/EDA's vision and supported staff proceeding with a Letter of Intent. The consensus of the City Council/EDA was to find that the conceptual development plan, as submitted by Told Development, is consistent with its development vision for this site and to direct staff to proceed with a Letter of Intent and Exclusive Negotiating Agreement with Ridgecrest Investors, LLC for the commercial development of Lot 1, Block 1, Northbrook Center 2 nd Addition (Told Development — 57 th and Logan). Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the Tidily of life for all people and preserves the public trust ' ..'• I . 'O F11, 1 ; •'•0 '15 I \ \I ‘, • es. , •.-, '' 0\o` --- --,,,,,,,‘••,-, - • 0 •. ........s,./. io, ' 44 ''.. _.....,---' • MEW ORANDUM CO TNCI WORK SESSEON DATE: February 24, 2014 TO: Curt Bogancy, City Manager FROM: Gary Eitel, Director of Business & Development 11?..- SUBJECT: Discussion regarding a Letter of Intent and Exclusive Negotiating Agreement with Ridgecrest Investors, LLC for the Commercial Development of Lot 1, Block 1, Northbrook Center 2" Addition (Told Development — 57' & Logan) Recommendation: It is recommended that the EDA consider providing direction to staff regarding proceeding with a Letter of Intent and Exclusive Negotiating Agreement with Ridgecrest Investors, LLC for the Commercial Development of Lot 1, Block 1, Northbrook Center 2" Addition (Told Development — 57 th & Logan). Background: In 2013, City Staff met with Jeff Budish, CBRE, and Trent Mayberry, Told Development, to conceptually discuss the potential interest of Told Development's participation in the acquisition of the Brookdale Square site and partnering with the EDA on a mixed use residential and commercial development, similar to their Excelsior & Grand Project in St. Louis Park. At that time, Told Development expressed reservations on taking on an additional residential project; however, they were very interested in pursuing the potential commercial development of the 57 111 and Logan Avenue site. Their interest referenced the similarities of this eight acre site to a commercial project, The Shores of Wedgwood that they were completing in the City of Maple Grove. This 8.5 acre PUD, located in the Northwest quadrant of 1-494 and Bass Lake Road, includes a Hilton Garden Inn, two multi-tenant commercial buildings, a Fairview Clinic, and a CVS Pharmacy. Additionally, there was confidential reference that a national commercial user was beginning a site selection process and they would like to pursue this business as an anchor commercial user for this site. Attached for your reference are copies of the marketing information for the Shores of Wedgwood project and aerial photography of the development. Information from the 2006 Northbrook Development Guidelines, prepared by Damon Farber Associates as part of the Opportunity Site Study, and the 2006 Letter of Intent with the Steiner Development Group for the proposed mixed use commercial & residential development of the ltlission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality oj ilfe for all people and preserves the public trust MEMO NDUM - COUNCIL WORK SESSION th'57 & Logan Avenue site were provided to Told Development as general parameters in pursing the potential acquisition of this 7.5 to 8 acre site owned by the EDA. Attached for your reference are copies of these prior planning concepts referenced above and a copy of the preliminary plat of Northbrook Center 2 nd Addition which identifies lot areas and the location of the overhead transmission easement. Told Development provided an initial draft of a letter of intent using their standard commercial language which was reviewed to ensure that the draft agreement was being prepared consistent with the statutory requirements for the sales of EDA owned properties. As the Letter of Intent evolved into its current format, the confidentiality of the proposed commercial user became less of an issue and Told Development had their consultant, Loucks & Associates prepare a conceptual development layout. This plan illustrates five potential commercial pad sites and a commercial theme which now enables the Letter of Intent to be prepared with greater specificity and assurance that as the EDA and Told Development progress through the various acquisition stages (letter of intent, purchase agreement, development agreement, approved development plans and ultimately closings) that the goals of the City/EDA are being met and the business plan of the Told Development is being satisfied. Conceptual Development Layout for the 57 th Ave. & Logan Site: The conceptual development layout illustrates five commercial pad sites and recognizes the following potential uses: •A 16,000 sq. ft. anchor tenant on a 2.5 acre site (corner of 57 th Ave. & Logan) with the following uses identified: grocery/gas station/anchor retail; •A 2,500 sq. ft. food/retail building on a 1 acre lot south of the Excel Energy transmission tower (corner of Hwy 100 & 57' Ave); •A 2,500 sq. ft. food/retail building on an 1 acre lot north of this transmission tower fronting on Highway 100. •A 6,600 sq. ft. retail building on a 1.05 acre site that faces the central portion of the site and located north of an internal access drive that aligns with the overhead transmission easement; •A 14,000 sq. ft. building pad on 2.4 acres within the northern portion of the site identified as a potential hotel/office/medical use. Told Development has indicated that the design concept was prepared to provide opportunities for a neighborhood center catering to nearby residents as a well as the freeway traffic driving by the site on a daily basis. Additionally, they have provided building elevations and photographs from The Shops of Wedgwood to illustrate the types of exterior finishes, quality, and character of the development they envision for the site. Letter of Intent and Exclusive Negotiating Agreement: The Letter of Intent provides for acquisition of the 57 th & Logan Avenue site, which is identified as Lot 1, Block 1, Northbrook Center 2 ' Addition. Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public (nisi MEMORANDUM - COUNCIL WO SESSION Note: Outlot A of this plat, the triangular tip of the site lying north of the intersection of Logan & 58 th Avenue is approximately 1/2 acre in size and was intentional omitted from the current negotiations to enable the MPCA to complete their ground water monitoring associated with finalizing the Dry Cleaning Vapor Study and Environmental Clean Up actions. The main components of the Letter of Intent include the following: the purchase price of $1,800,000; the buyer receives all Government approvals to complete an approved commercial development of the site; the buyer has a six month (180 day) period, referenced as the Tenant Development Period, to secure a commitment from a pharmacy, grocery store, or a nationally recognized retail tenant that will occupy at least 12,000 sq. ft. of retail space on the land that is acceptable to the Seller; if the buyer is unable to secure such a commitment either party may terminate the Development Agreement after the Tenant Development Period; a condition of the EDA's conveyance includes the provision that a Development Agreement will generally describe the acceptable development of the land; the Seller warrants that there are no wells on the land, there are no underground storage tanks on the Land, and to the best of the Seller's knowledge, there are no environmental or human hazards on the Land; a closing date on or before August 30, 2014. Policy Issues: Does the EDA believe the conceptual development plan submitted by Told Development is consistent with the EDA's development vision for this site? Does the EDA wish to proceed with negotiating a Letter of Intent with Told Development for the conveyance of the 57 th & Logan Avenue site? Strategic Priorities: 0 Focused Redevelopment Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust LETTER OF INTENT AND EXCLUSIVE NEGOTIATING AGREEMENT FOR DEVELOPMENT This Letter of Intent and Exclusive Negotiating Agreement is made as of the day of , 2013 by and between Ridgecrest Investors, LLC (d/b/a, TOLD Development Company), a Minnesota limited liability company ("Buyer"), and the Brooklyn Center Economia Development Authority, a Minnesota public corporation ("Seller"). The purpose of this Letter of Intent and Exclusive Negotiating Agreement ("LOT") is to set forth certain nonbinding understandings and certain binding agreements for the preparation of a Development Agreement and for the purchase and development of vacant land. 1.Seller. Economic Development Authority of Brooklyn Center, Minnesota ("EDA" or "Seller"), 6301 Shingle Creek Pkwy, Brooldyn Center, MN 55430... 2.Buyer. Ridgecrest Investors, LLC (d/b/a TOLD Development Company), a Minnesota limited liability company. 3.Scope of Sale. Buyer intends to purchase the Land described as Lot 1, Block 1, Northbrook Center 2"d Addition, comprised of approximately 7.00 acres (the "Land"). 4.Price and Terms. Buyer and Seller envision that the principal terms of the Development Agreement will be substantially as follows: a.Assets to be Acquired. Buyer will purchase the Land only with all easements and accesses thereto. Seller will convey marketable title to the Land. b.Liabilities to be Assumed. No liabilities will be assumed by Buyer. All the liabilities, other than those specifically mentioned herein or in the Development Agreement, shall be paid in full by the Seller. c.Consideration. Buyer shall deposit Earnest Money in the amount of Ten Thousand and No/100 Dollars ($10,000.00) in an escrow account with Old Republic Title Insurance Company. Earnest Money shall be refundable if Buyer cancels the Development Agreement in accordance with its terms. The aggregate consideration for the Land to be purchased shall be One Million Eight Hundred Thousand and No/100 dollars ($1,800,000.00), hereinafter "Purchase Price". d.Contingencies. The sale and purchase will be subject to the following contingencies, which may be modified by the mutual consent of the parties: i. Government Authority. Buyer will have been granted all permits, variances or other authorization needed to complete and/or operate the project. 1 432314v1 BR305-122 Financing. Buyer will have provided Seller with a copy of its financing commitment. Board/Council Authorization. Both Buyer and Seller will provide to the other corporate resolution or other evidence of authority, authorizing the purchase and sale. iv.During the first 180-day period after the effective date of the Development Agreement (the "Tenant Development Period"), Buyer will endeavor to secure a commitment from a pharmacy, grocery store or a nationally recognized retail tenant that will occupy at least 12,000 square feet of retail space on the Land and that is acceptable to Seller. If Buyer is unable to secure such a commitment either party may terminate the Development Agreement after the Tenant Development Period. v.Upon notification from Buyer that a nationally recognized retail tenant has made such a commitment, Buyer will promptly develop plans for development of the Land and make application for all zoning and land use approvals needed for its proposed development of the Land. Such plans are subject to approval by both the Seller and the City of Brooklyn Center (the "Development Plans"). Buyer will secure approval of all Development Plans within 90 days of the end of the Tenant Development Period. vi. Within 30 days of approval of all Development Plans, but no later than the date specified in paragraph 10, the parties will close the sale. e.Deed. The Deed conveying marketable title will be conveyed to Buyer at Closing. f.The Development Agreement will generally describe acceptable development of the Land. g.The Development Agreement will require that the Land be developed in accordance with plans approved by the Seller, Conveyance of the Land will be subject to covenants assuring that the Land will be developed in accordance with plans approved prior to closing or as later amended by mutual consent of the parties. The Development Agreement will include development of the Land that includes a pharmacy, grocery store or at least one nationally recognized retail tenant that is acceptable to Seller occupying at least 12,000 square feet. Seller will advise Buyer whether any proposed retail tenant is acceptable upon request. h.The Seller and Buyer will prorate taxes to date of closing. Seller will pay all levied or pending Special Assessments or other levies prior to closing. 2 432314v1 BR305-122 Seller will warrant that there are no wells on the Land; there are no underground storage tanks on the Land; and, to the best of Seller's knowledge, there are no environmental or human hazards on the Land. Seller will provide copies of all information relating to the Site from Seller's files including but not limited to surveys, soil conditions, environmental reports, plans for buildings, specifications, and geotechnical information. Additionally, Seller will provide Buyer with copies of all agreements with governmental authorities, easements, existing lease or other agreements that will affect or encumber the Site before or after a closing. 5.Government Review and Approval. Development of the Land will require public hearings for the sale of the property and land use approvals and site and building plan review. The City and the EDA will conduct public hearings and give full and fair consideration to the matters brought before them. Nothing in this Letter of Intent or the Development Agreement will require the approval of any application required for the development by the City or the EDA that is contrary to law or to the exercise of discretion by the City Council or the EDA as they deem appropriate in the best interest of the public at large. 6.Due Diligence Review. Promptly following the execution of the Development Agreement, Seller will allow Buyer to complete an examination of the Land, surveys, soils, environmental reports, plats, title, utilities and other legal documents as necessary and upon request of Buyer to complete due diligence. The parties will cooperate to complete due diligence expeditiously. 7.Termination. Buyer may terminate the Exclusive Negotiating Agreement or the Development Agreement to be entered into upon written notice to the Seller in which case all Earnest Money shall be returned to Buyer. 8.Definitive Development Agreement. All of the terms and conditions of the proposed transaction will be stated in the Development Agreement, to be negotiated, agreed and executed by Buyer and Seller. Neither party intends to be bound by any oral or written statements nor any correspondence concerning the Development Agreement arising during the course of negotiations, notwithstanding that the same may be expressed in terms signifying a partial, preliminary or interim agreement between the parties. 9. Development Agreement. All parties will use all reasonable efforts to complete and sign the Development Agreement before 10, Closing. Closing will occur on or before August 30, 2014. 11. Expenses. Each Party will pay their respective legal, accounting, underwriting, appraisal or other expenses incident to this Letter of Intent, the Development Agreement and the transactions contemplated hereby and thereby. 3 432314v1 BR305-122 12.Exclusive Negotiating Rights. In order to induce Buyer to commit the resources, forego other potential opportunities, and incur the legal, accounting and incidental expenses necessary properly to evaluate the possibility of acquiring the Land, and to negotiate the terms of, and consummate, the transaction contemplated hereby, Seller agrees that for a period of sixty (60) days after the date hereof, Seller and its respective officers, directors, employees, agents, and brokers shall not initiate, solicit, encourage, directly or indirectly, or accept any offer or proposal for all or any substantial part of the Land. 13.Miscellaneous. This Letter of Intent shall be governed by the laws of the State of Minnesota. This Letter of Intent constitutes the entire understanding and agreement between the parties hereto and their affiliates with respect to its subject matter and supersede all prior or contemporaneous agreements, representations, warranties and . understandings of such parties (whether oral or written). No promise, inducement, representation or agreement, other than as expressly set forth herein, has been made to or by the parties hereto. This Letter of Intent may be amended only by written agreement, signed by the parties to be bound by the amendment. Evidence shall be inadmissible to show agreement by and between such parties to any term or condition contrary to or in addition to the terms and conditions contained in thiS .Letter of Intent. This Letter of Intent shall be construed according to its fair meaning and not strictly for or against either party. 14. No Binding Obligation. Except for Section 12, this Letter of Intent does not constitute or create, and shall not be deemed to constitute or create, any legally binding or enforceable obligation on the part of either party to this Letter of Intent. No such obligation shall be created, except by the execution and delivery of the Development Agreement containing such terms and conditions of the proposed transaction as shall be agreed upon by the parties, and then only in accordance with the terms and conditions of such Development Agreement. RIDGECREST INVESTORS, LLC BROOKLYN CENTER ECONOMIC d/b/a TOLD Development Company DEVELOPMENT AUTHORITY By: By: Its Vice President Its President And by: Its Executive Director 4 432314v1 13R305-122 PRELIMINARY PLAT: 'VRTI=IBROOK CENTER 2ND ADDITION PROPOSED DEDICATED DRARI;DE MD UTILITY EASEMENTS _PROPOSED DRAINAGE UTILITY VACATION PROPOSED DED:CATION OF LOGAll AVE '-'.'',4'/ y . '; ::!, / / :I, Z./ /:: //:: 1 . 4 . . ,':' \ )( --.-....4 ,e. /17,47:// 1.((.. ,.• _. .,,,.; 47p . ,., , , ' i'• ' P / /..„ tIii/ V,/ ,' ''-7 ••':.•/ '7 ler/ /4)./".J,/•,/,` \ .., '' f;. '• // / CV," '/ 45(///' 1/* /":7 ) C'/' • / •,..f/. ''-. '.": r" "'''. 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FDra: 3.c C l'ak) 42:0 N-- a) -„, ,r) CL o a)ci 0 oa) a) 0 Eas fa a) C W w o _C 0 a) 03 cz 0) 0 .(1)_ ". 00 o5 Cc - 9c s P s_ . -C >0 0 (-) 0 2 -o > 4- 0 "rz a)a. 0 -0 < ° 0 vra' as •—•—C 0 >cs)-F, n 0 (i) ED 0 c N - -° c 0 0rE— -o 0_2? -o 4- 'a) 0 (1) c o C ici c 0 ,(2 .:.5s3cooccoo..as Gary Eitel From: Trent Mayberry <tmayberry@toldmn.com > Sent: Friday, February 07, 2014 1:06 PM To: Gary Eitel; Jeff Budish Subject: Brooklyn Center - Concept Plan Attachments: Conceptual Site Plan.pdf; FV BL 03.JPG; Original_pan3jpg; South Buildingjpg; The Shops at Wedgwood - Project Sheet.pdf Gentlemen, Please find attached a concept plan for the Brooklyn Center site. As discussed, we really look at this as both a neighborhood center catering to nearby residents as well as all the freeway traffic driving by the site on a daily basis. We envision this center having convenient access to both types of users and emulating aspects of our neighborhood shopping center in Maple Grove. Also attached for reference are a project sheet and photos for The Shops at Wedgwood which features a Hilton Garden Inn, Fairview Clinic, CVS, daycare, and two small shop buildings with drive-thrus. This will give you an idea of the types of materials and the look and feel we are proposing. Obviously, this is only a concept plan and we are not yet certain which users will commit. However, we believe what is shown is a feasible plan for this site which under any circumstance would feature the quality construction and design that TOLD is known for. Let me know if you have any comments or questions. Have a great weekend, Trent Mayberry Vice President TOLD ODA =Nov MANNY Two Carlson Parkway, Suite 220 • Minneapolis, MN 55447 Direct: 952.278.0112 • Fax: 952.278.7574 • Mobile: 612.812.4533 tmayberrytoldmn.com • www.tolddeveloomentcompanv.com 1 9 • Febnllavy 2014 p;-91 The Shops at Wedgwood Location Maple Grove, MN Building Use Neighborhood Retail Center Size 60,000 square feet Site 8.5 acres Completion Date 2006 Architect RSP Architects Contractor Rochon Corporation The Shops at Wedgwood features two buildings totaling 26,600 square feet of multi-tenant retail space, a CVS Pharmacy, and a Fairview Clinic situated on an 8.5-acre site in Wedgwood Commerce Centre. Wedgwood Commerce Centre is a 130-acre business park that features office and office-tech space, in addition to a Hilton Garden Inn and Tutor Time daycare center. The Shops at Wedgwood was recognized by the Minnesota Shopping Center Association (MSCA) with the STARR Award for Design & Aesthetics in 2006, DE VE LOPM EN r COMPANY NW- . 1- IiiDru= vagberi6,, Rril_ ., wt. (0)---' - 31-4 Ell (IOTA, Natured proittis prn:Inct types available ploprdles contact us Company Overview Company Overview TOLD Development Company is a real estate firm focused on the development, acquisition, and management of retail, multi-housing, office, medical office, and industrial properties. We are headquartered in Minneapolis and have another office in Milwaukee. Since TOLD was founded in 1985, we have capitalized upon the extensive real estate experience of our management to deliver more than .80 projects totaling in excess of 8 million square feet of space. TOLD's experience, creativity, and reputation enable us to successfully develop or acquire any project, regardless of its complexity. Our Mission Statement best describes TOLD's business philosophy: "To embody the highest standards of excellence in the delivery of quality real estate solutions through exceptional service, ingenuity, and the integrity necessary to insure complete customer satisfaction." Projects under continued development include Crossroads Commons, a $100- Million, 100-acre retail developMent in Plover/Stevens Point, Wisconsin and Lake Delton Marketplace, a 70-acre retail development in Lake Delton/Wisconsin Dells, Wisconsin. Both projects demonstrate our proven expertise in executing complex projects on behalf of our valued national retailers. Other prominent developments include Nagawaukee Center, a $50-million, 46-( acre retail development in Delafielcl, Wisconsin, Excelsior & Grand, a $170-milliol. vertically mixed-use project in St. Louis Park, Minnesota, Wedgwood Commerce Centre, a 130-acre mixed-use business park in Maple Grove, Minnesota, Crossroads Corporate Center, a 13-building office park in Brookfield, Wisconsin totaling 825,000 square feet, and Meridian Crossings, a 400,000-square-foot Class-A office development in Richfield, Minnesota. TOLD was also among the first developers to conceive of entertainment retail with The Meridian, an $80-million project in downtown Seattle, Washington. In addition to ground-up development, TOLD has purchased existing assets for its long-term investment porifoio. These existing assets were purchased from developers, lenders, and tenants with the intention of stabilizing and/or repositioning them for a long-term investment. TOLD has also managed properties for the long-term benefit of third party owners. TOLD Development Company enjoys an exceptionally strong reputation with the lending and institutional investor communities, We pride ourselves on the long- term, inulliple transaction relationships that we have with some of the country's most respected financial institutions. Our ability to finance projects creatively allows us to better service our clients. We frequently structure projects through financing instruments such cis participating debt, joint ventures, pre-sales and sale/leasebacks. - featured projects p(oduct typ ,,, available Nordics contact kis< HOME GTOLDnivevi-two CM-atir feat uredprojects Attout TOLE) feet of first floor retail space, including the first Trader Joe's grocery store in Minnesota. and 88,000 square feet of retail space. Total apartment onus with 64,000 square feet of retail space. Phases II, Ill, and IV included 306 condominiums with an additional 24,000 square Excelsior & Grand is a 16-acre redevelopment project located in St. Louis Park, Minnesota. This multi-phased project features 644 housing units project cost of $170 million. Phase I included 338 Excel*r ,,,„Q/oti-=1&} ici rari d ,,,( TOLD Development Company was selected by the City of St. Louis Park in July 2000 after the initial developer withdrew from the project. When TOLD Development Company 'assumed the development rights to the project, the plan proposed by the previous developer was determined not to be financially feasible. TOLD quickly assembled a team and addressed the complexities of the project and its financial viability. The resulting revisions balanced the benefits of vertical mixed-use with the financing challenges involved with such projects. TOLD Development Company developed all components of the project: apartments, condominiums, and retail. Please click here for further information. about TOLD I featured projects I product types I availabfe properties I contact us c : • T L GEsif1 1 LT COVIEPt I featuredprojects Pk)7 1 )1 featured projects prultut toot. cooll4blp 1,rolittlir5 Wedgwood Commerce Centre is a 130-acre, mixed-use business park located at the intersection of Bass Lake Road and Interstate 494 in Maple Grove, Minnesota. The project features more than 800,000 square feet of office and office/tech space, with plans for an additional 200,000 square feet of Class-A office space. Wedgwood also features a 120-room Hilton Garden Inn, medical clinic, daycare, preschool, and '50,000 square feet of restaurant and retail space. Wedgwood Commerce Centre's reputation as the northwest metropolitan area's premier business park is clue to the park's quality architecture, landscaping, and amenities. The park boasts such tenants as Cisco Systems and St. Jude Medical. about TOLD featured projects product types I available properties contact us TriLD .7. ' t(flt3tt 115 G WO O 7PP eE' r b 3 I 1 P - E :71 4 '77The Shops at IWGWOO ) PHASE I MAPLE (+ROVE, MINNESOTA NO. 494 c). INTERSTATE HWY. • •Hi11. . ,,,,...!..i..., • vii. ..= —inti m ,I l i I .111 ,i.' : ,I 4:3''. .i s'• ' ‘ ' CI ti• l •,1,:)•-y,o -,,,---.- .---. - '.•-'• ., tt-..., (,. ' ,.. t • ,i)itsv.'' ' i .•[til „ ., f.. kr... .: '.,....i.. ‘. ,r t ?1,,,,, j_e,„Al. mri, 3 „,•,.. j,,, ,:, ,„ it - ,-.1.,Ii. • 4..u. , )11 1"T:4114j.; iet , . , • '.i :-. . 'Rlf,if)1 • 5,-;■k •.1 :I' :1'tki. : -1}...t.•.‘' 1,7,t ti 1uif . 4i!ii,5 • :',• "%. s . '' 4111:ifftt . . ..;• -s , 1 , 7", , . i . • , . ,!. , ....1 ',■ ' ., . ,... , 1... • ? .• • , 44 .....- )k .•b '7 • 1 .. • ' .0.', • il' 0... . . • • 1.... . 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'' 1 i'l le ,,,N ° 1 - ''. .. • ' I I I I , •••• , Aii SeasonsCLEANERS C43, Cir.tnut; & La Kna ,11 ogvNAIts WedgwoodroN6, CliEZ A RN Al IDDentalearegOL rs v'tTaggneat44 Pirmi °Fantastic $ams D Trent Mayberry I 952.278.0112 I trent@toldmn.com DEVELOPMENT COMPANY --4111-111111110111111Li For Additional Information Contact: Wedg wThesohoopsdv EDA Agenda Item No. 5a EDA TEM ME ORANDUM DATE: April 28, 2014 TO: Curt Boganey, City Manager FROM: Gary Eitel, Business and Development Director Tim Benetti, Planning and Zoning Specialist SUBJECT: Resolution Authorizing the City of Brooklyn Center's Economic Development Authority to Submit a Business and Community Development Application to the Minnesota Department of Employment and Economic Development for a Minnesota Investment Fund (MIF) Grant for the Benefit of Palmer Lake BC, LLC (Sign Zone, Inc.) and the Palmer Lake Plaza Property, located at 6850 Shingle Creek Parkway Recommendation: It is recommended that the Economic Development Authority of Brooklyn Center, Minnesota (EDA) adopt the resolution authorizing the City of Brooklyn Center to submit a Business and Community Development application to the Minnesota Department of Employment and Economic Development (DEED) for a new Minnesota Investment Fund (MIF) grant, for the benefit Palmer Lake BC, LLC (Sign-Zone, Inc.). Background: In October 2013, planning staff met with Ed Flaherty and George Frost, President and Vice President, respectively of Lariat Companies and owners of Sign-Zone Inc. Lariat was in the process of purchasing the entire Palmer Lake Plaza facility, located at 6850 Shingle Creek Parkway, which sale was completed in November 2013. Sign-Zone, Inc. is seeking to relocate their corporate headquarters from Ramsey, MN and the manufacturing/distribution facilities in New Hope, MN to the Palmer Lake Plaza properties. Mr. Flaherty indicated that up to 250+ employees or jobs will be relocated to the city, with a potential of adding up to 25 or more once they complete the relocation and remodeling of the building. Sign-Zone is a manufacturer and reseller of visual communication and display products, such as signs, banners, colorfiil graphic displays, booths and furniture, which are used in the trade shows, conventions, seminar industries and other miscellaneous business needs. This Minnesota Investment Fund (MIF) application requests finding not to exceed $125,000.00, to be used for various business improvements, as approved by the city and DEED. The City of Brooklyn Center is noted as the "Applicant" for this grant program and acts on behalf of the benefitting business, which in this case is Palmer Lake BC, LLC (a/lda Sign-Zone, Inc.). According to DEED, there is no obligation or financial risk to the city under this program; unless we discover the benefitting party uses these funds for other unrelated needs or expenses not covered by this grant. These funds will only be paid out upon proper submittal of valid invoices and compliance with the provisions under the approved grant contract. Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for people and preserves the public trust EDA ITEM MEMORANDUM This item is being presented under a public hearing as specified by the DEED application instructions. This hearing will provide an opportunity for public comments from the city's residents, businesses, or surrounding community residents and/or businesses on the potential allocation of these public grant dollars to Sign-Zone, Inc. All comments (if any) will be forwarded to DEED for review and final considerations of this grant. Adoption of this resolution authorizes President Tim Willson and Executive Director Cornelius L. Boganey of the EDA, to act as the authorized officials on behalf of the City of Brooklyn Center, and submit the MIF grant application and supporting materials to the Minnesota Department of Economic Development for consideration and approvals. Budget Issues: There are no budget issues to consider, since the funds will be provided directly from DEED to the City, which are then allocated or distributed directly to Sign-Zone, Inc., provided they meet the requirements and terms of the application and DEED agreement. The primary budget impact will be staff time necessary to monitor the funds and process future payment requests. Strategic Priorities: Focused Redevelopment Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION AUTHORIZING THE CITY OF BROOKLYN CENTER'S ECONOMIC DEVELOPMENT AUTHORITY TO SUBMIT A BUSINESS AND COMMUNITY DEVELOPMENT APPLICATION TO THE MINNESOTA DEPARTMENT OF EMPLOYMENT AND ECONOMIC DEVELOPMENT FOR A MINNESOTA INVESTMENT FUND (MIF) GRANT FOR THE BENEFIT OF PALMER LAKE BC, LLC (SIGN ZONE, INC.) AND THE PALMER LAKE PLAZA PROPERTY, LOCATED AT 6850 SHINGLE CREEK PARKWAY BE IT RESOLVED that the Economic Development Authority in and for the City of Brooklyn Center, Minnesota, a body politic and corporate under the laws of the State of Minnesota ("EDA of Brooklyn Center") act as the legal sponsor for the project contained in the Business and Community Development Application to be submitted on the State of Minnesota Department of Employment and Economic Development's Minnesota Investment Fund (MIF) State Loan Program application, for the benefit of Sign Zone Inc., which is relocating its business and located the Palmer Lake Plaza facilities and property, located at 6850 Shingle Creek Parkway, Brooklyn Center, MN 55430; BE IT FURTHER RESOLVED, that Tim Willson, President, and Cornelius L. Boganey, Executive Director of the EDA, are hereby authorized to apply to the Department of Employment and Economic Development for finding of this project on behalf of the EDA of Brooklyn Center. BE IT FURTHER RESOLVED that the EDA of Brooklyn Center has the legal authority to apply for financial assistance, and the institutional, managerial, and financial capability to ensure adequate construction, operation, maintenance and replacement of the proposed project for its design life. BE IT FURTHER RESOLVED that the EDA of Brooklyn Center has not incurred any costs and has not entered into any written agreements to purchase property. BE IT FURTHER RESOLVED that the EDA of Brooklyn Center has not violated any Federal, State, or local laws pertaining to fraud, bribery, kickbacks, collusion, conflict of interest or other unlawful or corrupt practice. BE IT FURTHER RESOLVED that upon approval of its application by the state, the EDA of Brooklyn Center, may enter into an agreement with the State of Minnesota for the above-referenced project, and that the EDA of Brooklyn Center certifies that it will comply with all applicable laws and regulations as stated in all contract agreements and described on the Compliance Section (S-7) of the Business and Community Development Application. BE IT FURTHER RESOLVED that the EDA of Brooklyn Center has obtained credit reports and credit information from Sign Zone, Inc. and Ed Flaherty, President of Sign Zone, Inc. and other officers and owners of said company. Upon review by the EDA of Brooklyn Center and city attorneys with Kennedy and Graven, Chartered, no adverse findings or concerns regarding, but not limited to, tax liens, judgments, court actions, and filings with state, federal and other regulatory agencies were identified. Failure to disclose any such adverse information could result in revocation or other legal action. NOW, THEREFORE BE IT RESOLVED that Tim Willson, President of the EDA and Cornelius L. Boganey, the Executive Director of the EDA, or their successors in office, are hereby authorized to execute such agreements and amendments thereto, as are necessary to implement the project(s) on behalf of the applicant. 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, I CERTIFY THAT the above resolution was adopted by the Economic Development Authority of Brooklyn Center, Minnesota on April 28, 2014. SIGNED: Cornelius L. Boganey, City Manager/ Executive Director of the EDA WITNESSED: Sharon Knutson, City Clerk City of BROOKLYN CENTER Palmer Lake Plaza Property 6850 SHlng le Creek Parkway 0 200 400 800Feet cr- Atti71 1 Mr5:tArital 1- 1_1_1_1_111111-4+44--1-14-1-1-1-1 A LI I 074441-1-1-i i-I-H-F1-11 I 1 I M444,111111 -Rtti-ttlt44-4 ,t1 -1 -1 -1 . ru Lc --4-1-mar4 I ', —C1108AVM33HA -3i D. \ )7: -I I \\I 1\.3N Vel Wm= lafor•grs.m•-,,, \\‘0, 1- 0 _3) \ ()PLP ITE PLAN PLPO I Department of Employment and Economic Development • POSITIVELY~59 SUPPLEMENTAL APPLICANT INFORMATION (LOCAL UNIT OF GOVERNMENT) MINNESOTA INVESTMENT FUND STATE LOAN PROGRAM Applicant: City of Brooklyn Center Business Name: Sign Zone, Inc./Palmer Lake BC 11State Legislative District for Project Area: DUNS #: 07 -1355937 Tim Benetti, City Planner (763) 569 -3319Application Author: Author's Phone: Author's E -mail: tbenetti@ci.brooklyn -center.mn.us Attach the following information with the application. Application is not considered complete until all documents have been received. 1) COMMUNITY NEEDS NARRATIVE o Attach a community and economic development needs narrative which identifies in detail the priorities and strategies for resolving these needs based on the following criteria: A.Economic vulnerability of the community: B.Events contributing to a depressed economy: C.Unemployment (long term, chronic, current, seasonal): D.Need to attract or retain essential services: E.Events contributing to a unique situation: F.Infrastructure conditions: G.Out-migration due to lack of jobs: H.Need to diversify industrial base: I.Project will support the economic viability of small, minority, or women-owned businesses: J.Under-employment of existing labor pool: K.Labor pool needs: L.An increase in the value of the parcel(s) of land that will be directly assisted by the project. Provide a letter from the county/city assessor that provides the following information: Current assessed valuation, current real estate taxes payable, projected assessed valuation and projected real estate taxes payable 2) CITIZEN PARTICIPATION •A public hearing is required to provide citizen notification and involvement prior to submitting the application. Submit a copy of the public hearing minutes, a copy of the public notice and affidavit of publication, and the Local Government Resolution. 3) BUSINESS CREDIT CHECK •The following information searches on the business and owners holding 10 percent or more of the business must be acquired and reviewed prior to passing the Local Government Resolution: Lien/Judgment, Criminal Record, Pending Lawsuit, Dunn and Bradstreet, Credit Status Report, Bankruptcy (Also attach summary of findings and deposition). 11282012 1 •POSITIVELY ~50- Department of Employment and Economic Development SUPPLEMENTAL APPLICANT INFORMATION (LOCAL UNIT OF GOVERNMENT) MINNESOTA INVESTMENT FUND STATE LOAN PROGRAM 4) PROJECT COMPLIANCE •Review and sign attached document titled Project Compliance with State Laws, Statues, and Rules which outlines various state laws, statutes and rules that must be adhered to while implementing this project. These same requirements must be used in the administration of the local Revolving Loan Funds. 5) REVOLVING LOAN FUND •Submit a copy of the Local Government's Revolving Loan Fund policies and procedures. 6) CHECKLIST OF REQUIRED DOCUMENTATION: fl Completed Application (Applicant and Business) ri Notice of job listing agreement Revolving loan fund guidelines 1-1 Public hearing minutes Affidavit of publication Local unit of Government Resolution Project Compliance with State Laws, Statutes, and Rules If an award is provided for the project, the information contained in the application will become a matter of public record with the exception of those items protected under the Minnesota Government Data Practices Act found in Minnesota Statutes 1997, Chapter 13. I have read the above statement and I agree to supply the information requested to the Minnesota Department of Employment and Economic Development, Division of Business and Community Development with full knowledge of the information provided herein. I certify the information contained herein is true and accurate. Typed Name/Title Signature of Local Government Official Date POSITIVELY50- SUPPLEMENTAL APPLICANT INFORIVIATION (LOCAL UNIT OF GOVERNMENT) MINNESOTA IN FUND STATE LOAN PROGRAMDepartment of Employment and Economic Development PROJECT COMPLIANCE WITH STATE LAWS STATUTES, AND RULES 1.Minnesota Statutes, Section 181.59, discrimination on account of race, creed, or color prohibited in contracts. . 2.Minnesota Statutes, Section 363A.08 prohibits unfair discrimination practices related to employment or unfair employment practices. 3.Minnesota Statutes Chapter 363 Minnesota Human Rights Act. Requires that all public services be operated in such a manner that does not discriminate against any person in the access to, admission to, full utilization of or benefit from such public service. 4.Minnesota Statutes, Sections 176.181 — 176.182. Requires recipients and subcontractors to have worker's compensation insurance coverage. 5.Minnesota Statutes, Sections 290.9705. Requires that 8 percent of payments made to out-of-state contractors be withheld once cumulative payments made to the contractor for work done in Minnesota exceed $50,000 in a calendar year, unless a waiver is granted by the Department of Revenue. 6.Minnesota Statutes, Section 116J.871 applies to this project. This statute requires of recipients of state assistance to pay the prevailing wage rate to laborers and mechanics at the project construction site when state funds are provided for construction in the amount of $200,000 or more. 7.Minnesota Statutes Sections 471.87 and 471.88 - Forbids public officials from engaging in activities which are, or have the appearance of being, in conflict of interest. 8.Antitrust or unfair trade practices laws - Regulates and controls the sale of goods and services and prohibits deceptive and unfair competition between businesses. 9.Minnesota Statutes 116.1.993-995, Business Subsidy Statute, applies to this project. 10.Minnesota Statutes, 116J.8731, Minnesota Investment Fund applies to this project. 11.Minnesota Investment Fund Rules Chapter 4300. 12.Minnesota Statutes, Chapter 13, the Minnesota Government Data Practices Act. certifies compliance as so stated in the accompanying Local Government Resolution. (Signature of Applicant) 3 POSITIVELY SUPPLEMENTAL BUSINESS INFORMATION MINNESOTA INVESTMENT FUND STATE LOAN PROGRAM Department of Employment ad Economic Develoomord Name of Borrower (Business Legal Name): Palmer Lake BC, LLC & Sign-Zone, Inc. {Related Entities) Primary Business Contact: George R. Frost E -mail: George.Frost@LariatCompanies.ca 323111 03-299-9968NAICS Code: DUNS Number: A) OWNERSHIP STRUCTURE ev:ZdY■ei 1. Proprietorship, partners, officers, directors, holders of outstanding stock. 10 percent or more of business ownership must be accounted for: Name Title % of Ownership Edward Flaherty 2012 Irrevoc Trust Shareholder 48.68% Dennis Flaherty Vice President & Secretary 22.64% Edward Flaherty Chairman of the Board 13.05% John Bruellman President and CEO 10.00% 2.List all affiliates and subsidiaries of the business: Palmer Lake BC, LLC {single member LLC) 3.Have there ever been judgments or injunctions against the business or owners? n Yes NI No If yes, describe: 4.Is there pending litigation involving the business? 11 Yes II No If Yes, attach summary and disposition. 5.Has the business or the owners of the business ever filed bankruptcy? n Yes [El No If yes, describe: B) BUSINESS STRUCTURE — 911.--&-71 e 1. Indicate type of business and provide verification: Corporation: Articles of Incorporation, By-Laws, Certificate of Incorporation 0 Partnership: Partnership Agreement n LLC: Articles of Organization, Operating Agreement, Member Control Agreement, Certificate of Organization n Proprietorship or operates under a name other than the businesses legal name: Assumed Name Certificate, Affidavit of Publication Li Other: 1 11282012 Department Of Employment and Economic Development SUPPLEMENTAL BUSINESS INFORMATION MINNESOTA INVESTMENT FUND STATE LOAN PROGRAM C) OFFICERS / KEY EMPLOYEES — y n--a-d•Aeo c- 1. List Officers / Key Employees (President, Vice President, etc.): Name Title Years With Company Edward Flaherty Chairman 23 Dennis Flaherty Vice President & Secretary 23 John Bruellman President & CEO 8 0) CURRENT EMPLOYMENT INFORMATION — .9ivik 2831.Current Number of Full Time Equivalent (FTE) Employees in Minnesota: 2.Current Number of Full Time Equivalent (FTE) Employees on site: at Palmer Lake Plaza: zero *Provide the most recent payroll report which documents the current employment information stated above. The information provided in this section will be used as your base employment. Full Time Equivalent is based on a total annual hours of 2080 E) PROJECT TIMEFRAME Task Estimated Completion Date Commitment of all funds 5/28/14 Start of construction 6/1/14 Purchase Equipment 7/1/14 The data you supply in this application to the Minnesota Department of Employment and Economic Development will be used to assess your company's qualifications for a business loan. We will not be able to process the application without this information. If an award is provided for the project, the information contained in the application will become a matter of public record with the exception of those items protected under the Minnesota Government Data Practices Act found in Minnesota Statutes 1997, Chapter 13. I have read the above statement and I agree to supply the information requested to the Minnesota Department of Employment and Economic Development, Division of Business and Community Development with full knowledge of the information provided herein. I certify the information contained herein is true and accurate. Name/Title of Business Official: Geor , R. Frost, Treasurer, Sign-Zone, Inc. Signature of Business Official:, Date: 3/10/14 (952) 943 -1404 George.Frost@LariatCompanies.comTelephone Number: Email Address: 2 ,POSITIVELY SUPPLEMENTAL BUSINESS INFORMATION MINNESOTA INVESTMENT FUND ,04°- STATE LOAN PROGRAM Department of Employment and Economic Development F)SOURCES AND USES Personal Guaranties are required as a condition of the MIF loan. MIF Bank Equity Local Government Other Total Property Acquisition $ 435,000.0($ 900,000.0($ 1,335,000, Site Improvement $ 125,000.0($ 345,000.0($ 470,000.0( New Construction $ 425,000.0($ 425,000.0( Renovation of an Existing Building $ 900,000.0($ 900,000.0( Purchase of Machinery & Equipment $ 500,000.0($ 500,000.0( Other $ 587,000.0(.$ 587,000.0( Total Project Cost $ 125,000.0($ 3,192,000.$ 900,000.0($ 0.00 $ 0.00 $ 4,217,000. Term (years)7 Interest Rate 0.00%3.49%0.00%0.00%0.00%0.00% Collateral Lien Position 1st G)LENDER COMMITMENTS 1. Attach a detailed commitment letter from each of the above financing sources, including a letter of commitment for any business equity. Commitments must include amount, interest rate, term, collateral and conditions of loan. Bank of America, N.A. Michael Mrkaka)Funding Source: Contact Person: (612) 656 -0387 Michael.W.Mrnak@baml.comTelephone Number: Email Address: b)Funding Source: Contact Person: Telephone Number: Email Address: 3 Department of Employment and Economic Development SUPPLEMENTAL BUSINESS INFORMATION MINNESOTA INVESTMENT FUND STATE LOAN PROGRAM EI) JOB CREATION FORM - PERMANENT JOBS TO BE CREATED — 5(cp,1--Zayte POSITION TITLE NUMBER OF POSITIONS ANNUAL HOURS * HOURLY RATE WITHOUT BENEFITS HOURLY VALUE OF BENEFITS** TOTAL HOURLY WAGE INCLUDING BENEFITS Customer Service Rep 6 2080 $ 14.00$ 3.19 $ 17.19 Order Entry Rep 6 2080 $ 14.00 $ 3.19 $ 17.19 Production - Sewing 5 2080 $ 12.50 $ 3.01 $ 15.51 Preproduction - Graphic Artist 3 2080 $ 15.75 $ 3.39 $ 19.14 Digital Print Operator 2 2080 $ 14.25 $ 3.22 $ 17.47 Accounting Analyst 1 2080 $ 24.04 $ 4.85 $ 28.89 Software Developer 1 2080 $ 28.85 $ 5.51 $ 34.36 Business Systems Analyst 1 2080 $ 24.04 $ 4.85 $ 28.89 $ 0.00 $ 0.00 $ 0.00 Total jobs to be Created: 25 Average hourly Wage: $ 18.4i $Average hourly benefits: 3 '90 * Part-time positions are converted to full-time equivalent with full-time equivalent representing 2,080 hours annually. ** This hourly compensation should include non-mandated benefits to the employee. Non mandated benefit include: health, dental, life and long-term disability insurance; profit sharing, retirement contribution by employer, clothing allowance, tuition reimbufSement or direct payment for education expense, vacation and sick time (hourly value) and child care subsidy. Social security tax, unemployment insurance, workers compensation insurance and other benefits mandated by law MUST BE EXCLUDED, *** Per State Law governing the Minnesota Investment Fund Program, the total compensation including base wage and benefits must be at least 110% of the federal poverty income level for a family of four (verify current wage levels with loan officer at the time of application). CERTIFICATION R , FCC) 5'1— , certify that the employment information is true and accurate. George R. Frost, Treasurer, Sign -Zone, Inc.Name/Title of Business Official: Signature of Business Official: Z 3/10/14Date: 4 Department of EmployMerit and Economic Development SUPPLEMENTAL BUSINESS INFORMATION MINNESOTA INVESTMENT FUND STATE LOAN PROGRAM 0 NOTICE OF JOB LISTING AGREEMENT St el n eo C Per Minnesota Statutes 116L,66, a business or private enterprise receiving loans from the State of Minnesota in amounts in excess of $200,000 shall, as part of the grant or loan agreement, list any vacant or new positions with www.MinnesotaWorks.net . The employer is also advised to enlist the services of the Workforce Center Business Services staff to recruit and refer job candidates. The Job Listing Agreement includes some easy-to-follow steps: 1.At the time of financing award, the loan officer with DEED's JOBZ and Business Finance Office will provide written notification to DEED's Workforce Development Division MinnesotaWorks.net Help Desk Specialist. This notification will include the business name, address and phone number (as well as for the contact person) and the number and type of jobs to be created as a result of the DEED financing. 2.The MinnesotaWorksmet Help Desk Specialist will contact the Workforce Center nearest to the business location and send a copy of the Job Listing Agreement to the local Center along with the information provided by the JOBZ and Business Finance Office. 3.The Workforce Center representative will contact the business to schedule a meeting with the business contact to discuss and sign the Job Listing Agreement. The employer is required to list only those job openings in Minnesota and only for those job classifications that are specified in the DEED project. 4.Managerial positions or job openings to be filled by internal promotion need not be listed. Positions that require unusual skills, knowledge, abilities and/or experience not common to the labor market are also not subject to this Agreement. 5.The business will notify the Workforce Center of job openings at least 15 days prior to the anticipated hiring date. The employer will enter the job orders into Minnesota's Job Bank (www,MinnesotaWorks.net ) for recruitment purposes at that time as well. 6.The applicants will follow instructions on the job posting to apply for the open position. The business will make all decisions on which candidates they will interview and hire. The Job Listing Agreement is designed to help businesses find new employees by providing a free and simple method of recruiting and hiring qualified candidates. If you have questions please contact the MinnesotaWorks.net Help Desk Specialist at (651)259-7500. The mailing address is MinnesotaWorks.net , MN Department of Employment and Economic Development at 1 st National Bank Building, 332 Minnesota St., Suite E200, St. Paul, MN 55101, I HAVE READ THE ABOVE INFORMATION AND I WILL SIGN A JOB LISTING AGREEMENT AS A CONDITION TO RECEIVING A LOAN IN EXCESS OF $200,000 FROM THE MN DEPARTMENT OF EMPLOYMENT AND ECONOMIC DEVELOPMENT. Name/Title of Business Official: George R. Frost, Treasurer, Sign-Zone, Inc. Signature of Business Official: Date: 3/10/14 Telephone Number: (952) 943-1404 Email Address: George.Frost©LariatCompanies.com 5