HomeMy WebLinkAbout2020 03-09 EDAPE conomic Development
Authority
City Hall Council Chambers
March 9, 2020
AGE NDA
1.Call to Order
The City Council requests that attendees turn off cell phones and pagers during the meeting. A
copy of the full C ity Counc il packet, including E D A (E conomic Development Authority ), is
available to the public. The packet ring binder is located at the entrance of the council
chambers.
2.Roll Call
3.Approval of Consent Agenda
The following items are considered to be routine by the Economic Development Authority (E D A)
and will been acted by one motion. There will be no separate disc ussion of these items unless a
Commissioner so requests, in whic h event the item will be removed from the c onsent agenda
and considered at the end of Commission Consideration I tems.
a.Approval of Minutes
-Motion to approve the minutes for:
February 24, 2020
4.Commission Consideration Items
a.Resolution A pproving the Business Subsidy Program
- Approve a resolution to approve the amended Business Subsidy Program
b.Resolution A pproving the A cquisition of Certain P roperty L ocated at: 7015
Kyle Avenue N
- Motion to approve the resolution approving the acquisition of certain
property located at 7015 Kyle Avenue N, Brooklyn Center, MN.
5.Adjournment
Economic Development Authority
DAT E:3/9/2020
TO :C ity C ouncil
F R O M:C urt Boganey, City Manager
T H R O U G H :D r. Reggie Edwards, D eputy C ity M anager
BY:Barb S uciu, C ity C lerk
S U B J E C T:A pproval of Minutes
B ackground:
I n accordance with M innesota S tate S tatute 15.17, the official records of all mee5ngs must be documented
and approved by the governing body.
S trategic Priories and Values:
O pera5onal Excellence
AT TA C H M E N TS :
D escrip5on U pload D ate Type
2-24 E DA 3/3/2020 Backup M aterial
02/24/20 -1- DRAFT
MINUTES OF THE PROCEEDINGS OF THE
ECONOMIC DEVELOPMENT AUTHORITY
OF THE CITY OF BROOKLYN CENTER
IN THE COUNTY OF HENNEPIN AND THE
STATE OF MINNESOTA
REGULAR SESSION
FEBRUARY 24, 2020
CITY HALL – COUNCIL CHAMBERS
1. CALL TO ORDER
The Brooklyn Center Economic Development Authority (EDA) met in Regular Session called to
order by President Mike Elliott at 9:42 p.m.
2. ROLL CALL
President Mike Elliott and Commissioners Marquita Butler, April Graves, Kris Lawrence-
Anderson, and Dan Ryan. Also present were Executive Director Curt Boganey, Deputy City
Manager Dr. Reggie Edwards, Economic Development Coordinator Jimmy Lloyd, City Clerk
Barb Suciu, and City Attorney Troy Gilchrist.
3. APPROVAL OF AGENDA AND CONSENT AGENDA
Commissioner Butler moved and Commissioner Ryan seconded to approve the Agenda and
Consent Agenda, and the following items were approved:
3a. APPROVAL OF MINUTES
• January 13, 2020 – Regular Session
3b. RESOLUTION NO. 2020-04 APPROVING A TIF DEVELOPMENT
AGREEMENT FOR THE REE XERXES AVENUE SENIOR HOUSING
PROJECT
3c. RESOLUTION NO. 2020-05 ADOPTING A POLICY AND CRITERIA
FOR GRANTING BUSINESS SUBSIDIES
Motion passed unanimously.
4. COMMISSION CONSIDERATION ITEMS
4a. RESOLUTION NO. 2020-06 ADOPTING A PRELIMINARY DEVELOPMENT
AGREEMENT BETWEEN THE ECONOMIC DEVELOPMENT AUTHORITY
OF BROOKLYN CENTER AND JO PROPERTIES
02/24/20 -2- DRAFT
Economic Development Coordinator Jimmy Lloyd reviewed a proposed Preliminary
Development Agreement with JO Properties. He added a concept review was brought to the
EDA meeting on January 27, 2020, and the City Council was open to the concept. He noted the
agreement is non-binding for the developer and the City.
Mr. Lloyd stated the development agreement relates to a vacant, City-owned parcel at the
intersection of 61 st Avenue and Brooklyn Boulevard, located with a TIF district. He added the
proposal is for a 4-story, 83-88-unit multi-family housing development with a unique mix of
52% 3-bedroom units, and affordable at 50-60% AMI. He noted the total project cost is $22,
522,655, and grant proposals would be submitted to Hennepin County. Low-income housing tax
credits would apply, as well as a TIF subsidy.
Mr. Lloyd stated City Staff recommends approval of the Preliminary Development Agreement,
giving the developer one year to do due diligence, line up financing, and do an environmental
analysis and community engagement.
Commissioner Graves asked what other amenities would be included in the proposed
development besides a community garden, and whether other amenities would be considered
affordable or luxury amenities.
Mr. Lloyd stated the developer has identified other amenities like in-unit washer/dryers,
community rooms for residents, a business center with computers and internet access; and the
opportunity for a fitness center. He added this development would bring a high-quality product
to Brooklyn Center’s housing market, with nice amenities but still within affordability limits.
President Elliott stated this proposal uses the term “market rate”, which equates to $1,500 for a
1-bedroom apartment. He added he is not opposed to high-end amenities or luxury apartments,
but he has a problem with subsidizing them.
Commissioner Graves stated this project will require public subsidy, but also offers high quality,
or what some might consider luxury, amenities. She added they are not exclusive concepts. She
noted the City Council is considering approval or denial of this proposal, just like with any other
proposal.
Commissioner Graves moved and Commissioner Ryan seconded to adopt RESOLUTION NO.
2020-06 Adopting a Preliminary Development Agreement Between the Economic Development
Authority of Brooklyn Center and JO Properties.
President Elliott stated there might be additional questions.
President Elliott asked, with regard to unit rents, what the qualification is for a 1-bedroom unit at
50% AMI with a monthly rent of $937. Mr. Lloyd stated the pro forma was completed based on
Hennepin County rent AMIs.
02/24/20 -3- DRAFT
Commissioner Graves stated it is past 10:00 p.m., which was agreed upon by the City Council as
the time beyond which meetings would not extend.
President Elliott moved and Commissioner Butler seconded to extend the EDA meeting past
10:00 p.m.
Motion to extend passed unanimously.
Mr. Lloyd stated 50% AMI for a family of 4 would be $50,000. President Elliott asked what that
number would be for an individual.
The developer stated the pro form was based on Hennepin County guidelines.
Mr. Lloyd stated it is important to keep in mind that it is safe to assume that affordability will
change based on current market information. He added 50% AMI for 1 person would be
$35,000.
Original motion passed unanimously.
5. ADJOURNMENT
Commissioner Ryan moved and Commissioner Lawrence-Anderson seconded adjournment of
the Economic Development Authority meeting at 10:07 p.m.
Motion passed unanimously.
Economic Development Authority
DAT E:3/9/2020
TO :C ity C ouncil
F R O M:C urt Boganey, City Manager
T H R O U G H :N/A
BY:C urt Boganey, City Manager
S U B J E C T:Res olu'on A pproving the Bus iness S ubsidy P rogram
B ackground:
At the February 24, 2020, City Council mee'ng the C ity C ouncil amended the Bus iness S ubsidy Policy,
how ever, during the Economic D evelopment mee'ng the policy was adopted w ith out the amendments .
This res ulted in two different policies .
This res olu'on will amend the Bus iness S ubsidy policy so that is mirrors the policy approved by the City
Council.
B udget I ssues:
- No budget issues
S trategic Priori es and Values:
O pera'onal Excellence
AT TA C H M E N TS :
D escrip'on U pload D ate Type
Bus iness S ubsidy Policy 3/4/2020 Backup M aterial
Excerpt from February 24 C C M ee'ng 3/4/2020 Backup M aterial
Brooklyn Center Business Subsidy Criteria and Public Financing Policy Page 1
City of Brooklyn Center and
Brooklyn Center Economic Development Authority
Business Subsidy & Public Financing Policy
November 2019
INTRODUCTION:
This Policy is adopted for purposes of the business subsidies act, pursuant to Minnesota
Statutes, Sections 116J.993 through 116J.995 (the “Statutes”). Terms used in this Policy
are intended to have the same meanings as used in Statutes. Subdivision 3 of the
Statutes specifies forms of financial assistance that are not considered a business
subsidy. This list contains exceptions for several activities, including redevelopment,
pollution clean-up, and housing, among others. By providing a business subsidy, the city
commits to holding a public hearing, as applicable, and reporting annually to the
Department of Employment and Economic Development (“DEED”) on job and wage goal
progress.
1. PURPOSE AND AUTHORITY
A. The purpose of this document is to establish criteria for the City of Brooklyn
Center (“City”) and the Brooklyn Center Economic Development Authority
(“EDA”) for the granting of business subsidies and public financing for
private development within the City. As used in this Policy, the term “City”
shall be understood to include the EDA. These criteria shall be used as a
guide in processing and reviewing applications requesting business
subsidies and/or City public financing.
B. The City's ability to grant business subsidies is governed by the limitations
established in the Statutes. The City may choose to apply its Business
Subsidy Criteria to other development activities not covered under this
statute. City public financing may or may not be considered a business
subsidy as defined by the Statutes.
C. Unless specifically excluded by the Statutes, business subsidies include
grants by state or local government agencies, contributions of personal
property, real property, infrastructure, the principal amount of a loan at rates
below those commercially available to the recipient of the subsidy, any
reduction or deferral of any tax or any fee, tax increment financing (TIF),
abatement of property taxes, loans made from City funds, any guarantee of
any payment under any loan, lease, or other obligation, or any preferential
use of government facilities given to a business.
Brooklyn Center Business Subsidy Criteria and Public Financing Policy Page 2
D. These criteria are to be used in conjunction with other relevant policies of
the City. Compliance with the Business Subsidy Criteria and City Public
Financing Guidelines shall not automatically mean compliance with such
separate policies.
E. The City, at its sole discretion, may deviate from the job and wage goals
criteria outlined in Sec. 5, Subd. D, E, and F below by documenting in writing
the reason(s) for the deviation. The documentation shall be submitted to
DEED with the next annual report.
F. The City may amend this document at any time. Amendments to these
criteria are subject to public hearing requirements contained in the Statutes.
2. CITY’S OBJECTIVE FOR THE USE OF PUBLIC FINANCING
A. As a matter of adopted policy, the City may consider using public financing
which may include tax increment financing (TIF), tax abatement, bonds, and
other forms of public financing as appropriate, to assist private development
projects. Such assistance must comply with all applicable statutory
requirements and accomplish one or more of the following objectives:
1. Remove blight and/or encourage redevelopment in designated
redevelopment/development area(s) per the goals and visions
established by the City Council and EDA.
2. Expand and diversify the local economy and tax base.
3. Encourage additional unsubsidized private development in the area,
either directly or indirectly through secondary “spin-off” development.
4. Offset increased costs for redevelopment over and above the costs
that a developer would incur in normal urban and suburban
development (determined as part of the But-For analysis).
5. Facilitate the development process and promote development on
sites that could not be developed without this assistance.
6. Retain local jobs and/or increase the number of diverse quality jobs.
7. Reduce the unemployment rate within the City and encourage
created jobs are filled by local residents.
8. Provide opportunities for small businesses and/or entrepreneurs and
promote resident economic stability.
9. Meet other uses of public policy, as adopted by the City Council or
EDA from time to time, including but not limited to promotion of
quality urban design, quality architectural design, energy
conservation, sustainable building practices, and decreasing the
capital and operating costs of local government.
Brooklyn Center Business Subsidy Criteria and Public Financing Policy Page 3
3. PUBLIC FINANCING PRINCIPLES
A. The guidelines and principles set forth in this document pertain to all
applications for City public financing regardless of whether they are
considered a Business Subsidy as defined by the Statutes. The following
general assumptions of development/redevelopment shall serve as a guide
for City public financing:
1. All viable requests for City public financing assistance shall be
reviewed by staff, and, if staff so designates, a third party financial
advisor who will inform the City of its findings and recommendations.
This process, known as the “But For” analysis is intended to establish
the project would not be feasible but for the City assistance.
2. The City shall establish mechanisms within the development
agreement to ensure that adequate checks and balances are
incorporated in the distribution of financial assistance where feasible
and appropriate, including but not limited to:
a. Third party “but for” analysis
b. Establishment of “look back provisions”
c. Establishment of minimum assessment agreements
3. TIF and abatement will be provided on a pay-as-you-go-basis. Any
request for upfront assistance will be evaluated on its own merits and
may require security to cover any risks assumed by the City.
4. The City will set up TIF districts in accordance with the maximum
number of statutory years allowable. However, this does not mean
that the developer will be granted assistance for the full term of the
district.
5. The City shall elect to have the fiscal disparities contribution come
from inside applicable TIF district(s) to eliminate any impact to the
existing tax payers of the community.
6. Public financing will not be used to support speculative commercial,
office or housing projects. In general the developer should be able
to provide market data, tenant letters of commitment or finance
statements which support the market potential/demand for the
proposed project.
7. Public financing will generally not be used to support retail
development. The City may consider projects that include a retail
component provided they meet a Desired Qualification as identified
in Sec. 4.2 Subd. C of this policy.
8. Public financing will not be used in projects that would give a
significant competitive financial advantage over similar projects in
the area due to the use of public subsidies. Developers should
provide information to support that assistance will not create such a
Brooklyn Center Business Subsidy Criteria and Public Financing Policy Page 4
competitive advantage. Priority consideration will be given to
projects that fill an unmet market need.
9. Public financing will not be used in a project that involves a land
and/or property acquisition where the price is in excess of the fair
market value.
10. TIF and Abatement will not be utilized for the construction of
Warehouse/distribution, commercial storage, discount motel or
Fortune 1,000 companies.
11. The developer shall pay all applicable application fees and pay for
the City and EDA’s fiscal and legal advisor time as stated in the City’s
Public Assistance Application.
12. The City may consider waiving fees including, but not limited to, park
dedication fees, and SAC charges. The City may consider using
SAC credits, to the extent they are available, to off-set a project’s
SAC expenses.
13. The developer shall proactively attempt to minimize the amount of
public assistance needed through the pursuit of grants, innovative
solutions in structuring the deal, and other funding mechanisms.
14. All developments are subject to execution and recording of a
Minimum Assessment Agreement.
4. PROJECTS WHICH MAY QUALIFY FOR PUBLIC FINANCING ASSISTANCE
A. All new applications for public financial assistance that are considered by
the City must meet each of the following minimum qualifications. However,
it should not be presumed that a project meeting these qualifications will
automatically be approved for assistance. Meeting the qualifications does
not imply or create contractual rights on the part of any potential developer
to have its project approved for assistance.
4.1 MINIMUM QUALIFICATIONS/REQUIREMENTS:
A. In addition to meeting the applicable requirements of State law, the project
shall meet one or more of the public financing objectives outlined in Sec. 2.
B. The developer must demonstrate to the satisfaction of the City that the
project is not financially feasible “but for” the use of tax increment or other
public financing.
C. The project is, or will be through the City approval processes, consistent
with the City’s Comprehensive Plan and Zoning Ordinances, Design
Guidelines or any other applicable land use documents.
Brooklyn Center Business Subsidy Criteria and Public Financing Policy Page 5
D. Prior to approval of a financing plan, the developer shall provide any
requested market and financial feasibility studies, appraisals, soil boring,
private lender commitment, and/or other information the City or its financial
consultants may require in order to proceed with an independent evaluation
of the proposal.
E. The developer must provide adequate financial guarantees to ensure the
repayment of any public financing and completion of the project. These
may include, but are not limited to, assessment agreements, letters of
credit, personal deficiency guarantees, guaranteed maximum cost contract,
etc.
F. Any developer requesting public financial assistance must be able to
demonstrate a previous capability for successful development, as well as
specific capability regarding the type and size of the development proposed,
unless for a use specified in Sec. 4.2 Subd. C (9-10). Public financing shall
not be used when the developer’s credentials, in the sole judgment of the
City, are inadequate due to previous history relating to completion of
projects, general reputation, and/or bankruptcy, or other problems or issues
considered relevant to the City.
G. The developer, or its contractual assigns, shall retain ownership of any
portion of the project long enough to complete it, stabilize its occupancy,
establish project management and/or needed mechanisms to ensure
successful operation.
4.2 DESIRED QUALIFICATIONS:
A. Projects providing a high ratio of private investment to City public
investment shall receive priority consideration. Private investment includes
developer cash, government and bank loans, conduit bonds, tax credit
equity, and land if already owned by the developer.
B. Proposals that significantly increase the amount of property taxes paid after
redevelopment will receive priority consideration.
C. Proposals that encourage the following will receive priority consideration:
1. Implements the City’s vision and values for a City-identified
redevelopment area
2. Provides significant improvement to surrounding land uses,
neighborhoods, and/or the City
3. Attracts or retains an employer within the City providing over 50 jobs
4. Provides increased quality and higher paying jobs
5. Promotes multi-family housing investment that meets the following
City goals:
Brooklyn Center Business Subsidy Criteria and Public Financing Policy Page 6
a. Increase housing choice within the community; diversify existing
housing stock; and provide options that do not currently exist
b. Provide clean, safe, and affordable housing units
c. Include housing as part of City special purpose projects, such as
the Opportunity Site, or other priority City redevelopment areas.
d. Multi-family housing with high-quality amenities
6. Provides opportunity for the attraction and retention of sit-down
restaurants
7. Fulfils workforce needs by hiring local residents and partnering with
the City and local community organizations for targeted recruitment
of residents, job training and mentorship programs.
8. Offers employment opportunities for local residents with safe working
conditions and access to comprehensive benefit packages
9. Provides opportunities for small businesses and/or entrepreneurs
10. Projects that promote resident economic stability
11. Redevelops a blighted, contaminated and/or challenged area
12. Preserves and/or stabilizes a major commercial or industrial node
13. Adds needed public infrastructure such as roads or structured
parking
5. BUSINESS SUBSIDY PUBLIC PURPOSE, JOBS AND WAGE REQUIREMENT
A. All business subsidies must meet a public purpose with measurable benefit
to the City as a whole.
B. Job retention may only be used as a public purpose in cases where job loss
is specific and demonstrable. The City shall document the information used
to determine the nature of the job loss.
C. The creation of tax base shall not be the sole public purpose of a subsidy.
D. Unless the creation of jobs is removed from a particular project pursuant to
the requirements of the Statutes, the creation of jobs is a public purpose for
granting a subsidy. Creation of at least 1 Full Time, or Full Time Equivalent
(FTE) jobs is a minimum requirement for consideration of assistance. For
purposes of this Policy, FTE jobs must be permanent positions with set
hours, and be eligible for benefits.
E. Part-Time Equivalent jobs may receive a partial credit and be counted
toward the job goals.
F. The wage floor for wages to be paid for the jobs created shall be not less
Brooklyn Center Business Subsidy Criteria and Public Financing Policy Page 7
than 150% of the State of MN Minimum Wage. The City will seek to create
jobs with higher wages as appropriate for the overall public purpose of the
subsidy. Wage goals may also be set to enhance existing jobs through
increased wages, which increase must result in wages higher than the
minimum under this Section.
G. After a public hearing, if the creation or retention of jobs is determined not
to be a goal, the wage and job goals may be set at zero.
6. SUBSIDY AGREEMENT
A. In granting a business subsidy, the City shall enter into a subsidy agreement
with the recipient that provides the following information: wage and job goals
(if applicable), and recourse for failure to meet goals required by the
Statutes.
B. The subsidy agreement may be incorporated into a broader development
agreement for a project.
C. The subsidy agreement will commit the recipient to providing the reporting
information required by the Statutes.
7. PUBLIC FINANCING PROJECT EVALUATION PROCESS
A. The following methods of analysis for all public financing proposals will be
used:
1. Project is deemed consistent with City’s Goals and Objectives
2. Consideration of project meeting minimum qualifications
3. Consideration of project meeting desired qualifications
4. Project meets “but-for” analysis and/or statutory qualifications
Please note that the evaluation methodology is intended to provide a
balanced review. Each area will be evaluated individually and collectively
and in no case should one area outweigh another in terms of importance to
determining the level of assistance.
EXCERPT FROM FEBRUARY 24, 2020 CITY COUNCIL MEETING
8d. RESOLUTION NO. 2020-33 ADOPTING A BUSINESS SUBSIDY POLICY
Councilmember Ryan moved and Councilmember Lawrence Anderson seconded to amend
Section 4.2, Item D of the Business Subsidy Policy to read, “Multi-family housing with high-
quality amenities.”
Mayor Elliott and Councilmember Butler voted against the same. Motion to amend passed.
Councilmember Ryan moved and Councilmember Lawrence-Anderson seconded to adopt
RESOLUTION NO. 2020-33 Adopting a Policy and Criteria for Granting Business Subsidies, as
amended.
Mayor Elliott and Councilmember Butler voted against the same. Motion passed.
Economic Development Authority
DAT E:3/9/2020
TO :C ity C ouncil
F R O M:C urt Boganey, City Manager
T H R O U G H :N/A
BY:M eg Beekman, C ommunity D evelopment D irector
S U B J E C T:Res olu+on A pproving the A cquisi+on of Certain P roperty L ocated at: 7015 Kyle Avenue N
B ackground:
The property, 7015 Kyle Avenue N, is a res iden+al property with a total size of 0.65 acres . I t is acces s ed off
of 70th Avenue by a public roadw ay w hich func+ons as the drivew ay to the property. The property is
currently z oned R-5: M ul+ple Family Residence, and is guided under the 2040 Comprehensive P lan with a
F uture Land Use of Neighborhood Mixed-Use. A lthough z oned as an R-5 property, the property has been
u+lized as a s ingle-family residence with the primary home being constructed in 1965. The property has an
asses s ed market value of $240,000.
The property is currently owned by M arcella H agen. C onversa+ons with the property ow ner and the City
regarding a poten+al s ale have been happening for the past 5-10 years, though no terms w ere discussed as
Mrs . H agen had indicated s he was not ready to s ell her property. Recently Mrs . H agen and her family had a
repres enta+ve reach out to the C ity to inquire about a poten+al purchas e. The C ity provided a draA
purchas e agreement to indicate the terms of a sale. Mrs . H agen and her family met to discuss the terms and
decided to proceed with the s ale. The purchas e agreement, signed by Mrs H agen is aBached to this memo.
The total cos t to the E DA as s ociated w ith the acquis i+on of the property is $245,000. This amount includes
the purchase price of the property of $240,000 and moving expens es to the homeow ner of $5,000. The
purchas e agreement allows for the property owner to remove any fixtures w ithin the home under the
condi+on it does not affect the s afety or s ecurity of the s tructure. The purchase agreement allow s the C ity
to ins pect the property, w hich w ould occur to determine the cost of demoli+on. U pon clos ing on the
property, the C ity would demolish the s tructure on the property, w hich is es+mated to cost around
$20,000.
The E DA currently owns the tw o proper+es directly to the wes t and south this property. The E DA -ow ned
property has a total size of 0.8 acres . A lso to the w est of M rs. H agen's property is a 12-unit mul+-family
apartment building, which may be coming for s ale. S taff will con+nue to monitor this site to s ee if makes
s ense to acquire.
S taff has als o been in communica+on w ith the staff and board of S t. A lphonsus church, which has indicated
a possible interest in leveraging exces s land they own that is adjacent to Mrs . H agen's property. S taff will
con+nue these conversa+ons with the church.
The E DA has had a policy of acquiring and as s embling single family proper+es along Brooklyn Boulevard for
many years. W ith the reconstruc+on of Brooklyn Boulevard and the upcoming land use s tudy and crea+on
of an overlay dis trict it is an+cipated that the corridor w ill trans i+on to higher intensity land uses over +me.
A cquiring proper+es as they become available is a strategy for targeted redevelopment.
B udget I ssues:
T I F #3 F unds w ill be used for the acquisi+on of the property.
S trategic Priori es and Values:
Targeted Redevelopment
AT TA C H M E N TS :
D escrip+on U pload D ate Type
Res olu+on 3/2/2020 Resolu+on LeBer
P urchas e A greement 3/2/2020 Backup M aterial
L oca+on Map 3/2/2020 Backup M aterial
A erial Map 3/2/2020 Backup M aterial
640584v2BR305-161
Commissioner ________________ introduced the following resolution and moved its
adoption:
EDA RESOLUTION NO. 2020- ___
RESOLUTION APPROVING THE PURCHASE AGREEMENT AND ACQUISTION OF
CERTAIN PROPERTY LOCATED AT: 7015 KYLE AVENUE NORTH, BROOKLYN
CENTER, MN 55429
BE IT RESOLVED by the Board of Commissioners (“Board”) of the Economic
Development Authority of Brooklyn Center, Minnesota (“Authority”) as follows:
Section 1. Recitals.
1.01. The Authority is authorized pursuant to Minnesota Statutes, Sections 469.090 to
469.1081 (the “EDA Act”), to acquire and convey real property and to undertake certain activities to
facilitate the development of real property by private enterprise.
1.02. To facilitate development of certain property in the City of Brooklyn Center,
Minnesota (the “City”), the Authority proposes to enter into a Purchase Agreement (the “Agreement”)
between the Authority and Marcella Hagen (the “Seller”), under which, among other things, the Seller
will convey the property located in the City at: 7105 Kyle Avenue North, situated in the State of
Minnesota, County of Hennepin, and which is legally described as follows:
SEE ATTACHED EXHIBIT A
(the “Property”).
1.03. The Authority finds and determines that the acquisition of the Property is in the public
interest and will further the objectives of its general plan of economic development.
Section 2. Authority Approval; Further Proceedings.
2.01. The Board hereby approves the Agreement in substantially the form presented to the
Board, including the acquisition of the Property by the Authority, subject to modifications that do not
alter the substance of the transaction and that are approved by the President and Executive Director,
provided that execution of the Agreement by those officials shall be conclusive evidence of their
approval.
2.02. Authority staff and officials are authorized to take all actions necessary to perform the
Authority’s obligations under the Agreement as a whole, including without limitation execution of
any documents to which the Authority is a party referenced in or attached to the Agreement, and other
documents necessary to convey the Property to the Authority, all as described in the Agreement.
March , 2020
640584v2BR305-161 2
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.
640584v2BR305-161 3
EXHIBIT A
Legal Description of the Property
That part of the South 214.70 feet of the North 259.5 feet of Lot 5 Auditor’s Subdivision No. 57
Hennepin County, Minnesota, as described as follows:
Commencing at a point in the South line of said lot 5, a distance of 185.0 feet East of the intersection
of the South line of said Lot 5 with the Northeasterly right of way line of State Trunk Highway #152;
then North 0 degrees 33 feet 30 inches West (said bearing is assumed) along a line parallel with the
East Line of said Lot 5 a distance of 131.0 feet more or less to the south line of the said North 259.5
feet and also being the actual point of beginning of the tract to be described; thence continuing North
0 degrees 33 feet 33 inches West along the extension of the last described line for a distance of 142
feet; thence Northwesterly along a tangential curve to the left with a radius of 175.7 feet for a distance
of 75.12 feet more or less to the North line of the said South 214.7 feet; said point being 420.76 feet
East of the said Northeasterly right of way line as measured along the North line of said South214.7
feet; thence West 0 degrees 00 along the last described North line for a distance of 75.53 feet more
or less to its intersection with a line which is 130.0 feet West of and parallel with aforesaid line that
had a bearing of North 0 degrees 33 feet 30 inches West; thence South o degrees 33 feet 30 inches
East a distance of 141.0 feet more or less to the South line of said North 259.5 feet; thence East to the
actual point of beginning, and including an easement for driveway purposes as describe din that
certain deed recorded in Book 2455 of Deeds on page 583, in the office of the Register of Deeds in
and for the County of Hennepin, State of Minnesota.
PURCHASE AGREEMENT
564933v I BR305-l 57
1.PARTIES. This Purchase Agreement ("Purchase Agr�ement") is entered into this.
day of March, 2020, by and between Marcella Hagen ("Seller") and the Economic Development
Authority of Brooklyn Center, Minnesota, a public body corporate and politic under the laws of
the State of Minnesota ("Buyer").
2.SALE OF PROPERTY. Seller is the owner of that ce1iain real estate ("Prope1iy")
located at 7015 Kyle Avenue N, Brooklyn Center, MN 55429, Hennepin County, Minnesota and
legally described as follows:
3.OFFER/ACCEPTANCE. In consideration of the mutual agreements herein contained,
Buyer offers and agrees to purchase and Seller agrees to sell and hereby grants to Buyer the
exclusive right to purchase the Prope1iy and all buildings, improvements, and fixtures thereon,
together with all appmienances, including, but not limited to, plant, shrubs, trees, and grass.
4.NO PERSONAL PROPERTY INCLUDED IN SALE: There are no items of personal
prope1iy or fixtures owned by Seller and cun-ently located on the Prope1iy included in the
Purchase Price for purposes of this sale.
5.PURCHASE PRICE AND TERMS:
A. PURCHASE PRICE: The total Purchase Price ("Purchase Price") for the
Prope1ty is Two Hundred F01iy Thousand and No/l00ths Dollars ($240,000.00).
B.MOVING EXPENSES: The sum of Five Thousand Dollars ($5,000.00) to
reimburse Seller for Seller's moving expenses ("Moving Expenses") shall be paid
by Buyer to Seller at Closing.
C.TERMS:
(1) BALANCE DUE SELLER: Buyer agrees to pay the Purchase Price to
Seller by check or wire transfer on the Closing Date ("Closing").
(2)DEED/MARKETABLE TITLE: Subject to performance by Buyer, Seller
agrees to execute and deliver a W mrnnty Deed conveying marketable title
to the Prope1iy to Buyer, subject only to the following exceptions:
a .Building and zoning laws, ordinances, and state and federal
regulations.
b .Reservation of minerals or mineral rights to the State of
Minnesota, if any.
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B.Standard form Affidavit of Seller.
C.Well disclosure certificate, if required.
\
D.Waiver of Relocation Benefits in the form attached hereto as Exhibit A.
E.Such other documents as may be reasonably required by Buyer's title examiner or
title insurance company.
8.CLOSING DATE/DUE DILIGENCE PERIOD. For a maximum of 90 days after the
mutual execution of the Purchase Agreement (the "Due Diligence Period"), Buyer shall have the
right, but not the obligation, to conduct an investigation of the Property as described in paragraph
6 (A) of this Purchase Agreement. The closing of the sale of the Property shall take place within
30 days following the end of the Due Diligence Period. The closing shall take place at the
offices of Economic Development Authority of Brooklyn Center, 6301 Shingle Creek Parkway,
Brooklyn Center, MN 55430 (or at such other location as the parties shall agree).
9.DELIVERY OF DOCUMENTS. Within seven business days of signing the Purchase
Agreement, Seller shall have provided Buyer with copies of all relevant material in Seller's
possession relating to the Prope1ty, including but not limited to, title reports, soil rep01is,
environmental studies, surveys, environmental rep01is, agreements with governmental
authorities, or other records of the Prope1ty that Seller has in Seller's possession (collectively,
the "Documents").
10.INSPECTION OF PROPERTY. During the Due Diligence Period, Seller shall allow
Buyer and Buyer's agents access to the Property without charge and at all reasonable times for
Buyer's inspection of the Prope1ty. This includes the right of Buyer and its agents to take soil
borings of the Property. Buyer shall pay all costs and expenses of such inspections and any
testing canied out in connection therewith, and shall hold Seller and the Prope1ty harmless from
all costs and liabilities relating to Buyer's activities. Buyer shall not damage, encumber, or
permit a lien or claim to result from its activities, or alter the Prope1ty in any way. Buyer shall
not have the right to do any intrusive testing without the prior written authorization of Seller.
Buyer shall repair and restore any damage to the Prope1iy caused by or occuning during Buyer's
inspection and testing and return the Prope1iy to substantially the same condition as existed prior
to such entry. Buyer's obligations under this paragraph shall survive termination of this
Agreement.
11.ENVIRONMENTAL INSPECTION. Seller, prior to vacation of the Prope1ty, shall
remove all substances that, under state or federal law, must be disposed of at an approved
disposal facility. This requirement does not apply to hazardous substances integrated into the
building improvements (e.g., asbestos) or soil but applies only to movable equipment, supplies
and materials that are located or stored on the Prope1ty. Buyer and Seller will conduct a joint
inspection of the Property at a time to be mutually agreed upon prior to closing for the purpose of
identifying materials that must be removed by Seller.
12.LEAD. If the dwelling struc;:ture on the Prope1ty was constructed prior to 1978, a lead
paint disclosure accompanies this Agreement.3 564933v I BR305-l 57
13.REAL ESTATE TAXES.
A. Seller will pay at or prior to closing all real estate taxes due and payable in 2019
and prior years on the Property, including any delinquent real estate taxes.
B.Real estate taxes due and payable in 2020 shall be prorated as of the date of
closing between Buyer and Seller. If the amount of real estate taxes due and
payable in 2020 is not available on the date of closing, the pro-rated taxes will be
· based on the amount of real estate taxes due and payable in 2019.
14.SPECIAL ASSESSMENTS.
A. Seller shall pay on or prior to closing the balance of all special assessments levied
for payment in 2019 and prior years. Buyer shall pay all special assessments
pending or levied for payment with real estate taxes payable in 2020.
B.Seller shall pay any defe1Ted real estate taxes or special assessments, payment of
which is required as a result of the Closing of this sale.
C.As of the date of this Purchase Agreement, Seller has not received a notice of
hearing for a new public improvement project from any governmental assessing
authority, the costs of which project may be assessed against the Property.
D.Notwithstanding any other provision of this Agreement, Seller shall at all times be
responsible to pay special assessments, if any, for delinquent sewer or water bills,
removal of diseased trees prior to the date of this Purchase Agreement, snow
removal, or other cu1Tent services provided to the Property by the assessing authority
while Seller is in possession of the Property.
15.MARKETABILITY OF TITLE. Buyer shall, within a reasonable time after execution
of this Purchase Agreement by both paiiies, obtain a commitment for title insurance
or other evidence satisfactory to Buyer ("Title Evidence") for the Prope1iy. Buyer
shall have ten (10) business days after receipt of a fully executed purchase agreement
and the Title Evidence to examine the same and to deliver written objections to title,
if any, to Seller. Seller shall have until the expiration of the Due Diligence Period ( or
such later date as 'the parties may agree upon) to make title marketable, at Seller's
expense. In the event that title to the Prope1iy cannot be made· marketable or is not
made marketable by Seller by the expiration of the Due Diligence Period, then, at
the option of Buyer, Buyer may terminate this Purchase Agreement in
accordance with paragraph 6 (B)(l) of this Purchase Agreement.
16. 1 CLOSING COSTS AND RELATED ITEMS. Seller will pay: (a) any deed transfer
'taxes and conservation fees and recording fees for all instruments required to establish
marketable. title in Seller; (b) any deed transfer taxes and conservation fees required to enable
Buyer to record its deed from Seller under this Purchase Agreement; ( c) the cost of the title
commitment, title search, name searches, and exam fees; and ( d) one-half of the closing fee
charged by the title insurance or other closing agent, if any, utilized to close the transaction
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564933vl BR305-157
Location Map: 7015 Kyle Avenue N.
Aerial Map: 7015 Kyle Avenue N