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HomeMy WebLinkAbout2021 01-11 EDAPE conomic Development Authority V I RT UA L meeting being conducted by electronic means in accordance with Minnesota S tatutes, section 13D.021 P ublic portion available for connection via telephone Dial: 1-312-626- 6799 Meeting I D: 97680230856# P asscode: 7635693300# J anuary 11, 2021 AGE NDA 1.C all to Order The C ity Council requests that attendees turn off cell phones and pagers during the meeting. A copy of the full City Council packet, including E D A (Economic Development Authority ), is available to the public . The packet ring binder is located at the entranc e of the council chambers. 2.Roll Call 3.Approval of Consent Agenda The following items are considered to be routine by the Ec onomic Development Authority (E D A ) and will been acted by one motion. There will be no separate discussion 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 C ommission Consideration I tems. a.A pproval of Minutes - Motion to approve the mi nutes for: December 7, 2020 b.Resolution Opting not to Waive L imited Tort L iability f or 2021 Moti on to approve the attached resolution adopting the no waiver option for statutory tort liability insurance. 4.C ommission C onsideration Items a.Resolution Approving the S econd A mendment to L ease Agreement and Relocation Assistance A greement with Sheng Zheng, Wang L in, L in, I nc., O perating Under the Trade Name "Ocean B uf fet" and A latus B rooklyn C enter - Motion to authorize approval of a Resolution Approving the Second Amendment to Lease Agreement and Relocation Assistance Agreement with Sheng Zheng, Wang Li n, Lin, Inc., Operating Under the Trade Name "Ocean Buffet" and Alatus Brooklyn Center b.Resolution E lecting Officers for the E conomic Development A uthority in and f or the C ity of Brooklyn C enter - Approve Resolution Electi ng Officers for the Economic Development Authority in and for the Ci ty of Brooklyn Center 5.Adjournment E conomic Development A uthority DAT E:1 /11/2 0 2 1 TO :C ity Council F R O M:C ur t Boganey, C ity M anager T H R O U G H :D r. Reggie Edw ards , D eputy C ity M anager BY:Barb S uciu, City Clerk S U B J E C T:A pprov al of M inutes B ackground: I n accordance w ith Minnes ota S tate S tatute 1 5 .17, the official records of all mee3 ngs mus t be documented and approved by the gov erning body. S trate gic Priories and Values: O pera3 onal E xcellence AT TA C H M E N TS : D escrip3on Upload D ate Ty pe 12-7 M inutes 1/5/2021 Backup M aterial 12/07/20 -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 DECEMBER 7, 2020 1. CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in Regular Session called to order by President Mike Elliott at 7:38 p.m. The meeting was conducted via Webex. 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, Finance Director Mark Ebensteiner, and City Clerk Barb Suciu. 3. APPROVAL OF CONSENT AGENDA Commissioner Ryan moved and Commissioner Graves seconded to approve the Agenda and Consent Agenda, and the following item was approved: 3a. APPROVAL OF MINUTES 1. November 9, 2020 – Regular Session Motion passed unanimously. 4. COMMISSION CONSIDERATION ITEMS 4a. RESOLUTION NO. 2020-20 APPROVING THE FINAL BUDGET FOR THE ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER, MINNESOTA FOR FISCAL YEAR 2021 Commissioner Graves expressed her thanks to City Staff, Commissioners and Financial Commissioners for all the hard work throughout this process. She added everyone was very intentional and had some deep discussions, and she really enjoyed the process. She noted there’s always room for improvement, but she believes everyone did their best and worked together during this difficult year to put forward this budget. Commissioner Ryan stated he appreciates the comments of his friend April Graves, and he too would like to thank everyone involved in the budget process. He added City Staff worked extraordinarily hard on the budget and has been working outside the box to help us to address the 12/07/20 -2- DRAFT challenges in what has been a year like no other. He also thanked the members of the public who took the time to join the budget meetings. Commissioner Ryan moved and Commissioner Graves seconded to adopt RESOLUTION NO. 2020-20 Approving the Final Budget for the Economic Development Authority of Brooklyn Center, Minnesota For Fiscal Year 2021. Discussion during motion: President Elliott stated a lot of hard work went into this budget. He added it will be necessary to work even harder in 2021, but the City has a head start. He noted he has been the ears of City Staff and the City Council toward reducing the budget and therefore the financial burden on residents. He expressed confidence that the City Council will continue to work on these issues, focus on priorities and move the City forward. Motion passed unanimously. 5. ADJOURNMENT Commissioner Ryan moved and Commissioner Graves seconded adjournment of the Economic Development Authority meeting at 7:46 p.m. Motion passed unanimously. E conomic Development A uthority DAT E:1 /11/2 0 2 1 TO :C ity Council F R O M:C ur t Boganey, C ity M anager T H R O U G H :N/A BY:M ark E bensteiner, F inance D ir ector S U B J E C T:Res olu(on O p(ng not to Waiv e L imited Tort L iability for 2 0 2 1 B ackground: Each year the E DA mus t choose w hether to w aiv e tor t liability limit protec(ons of M innesota S tatutes 4 66.04 as part of the ins urance policy renew al applica(on proces s . M .S . 466.0 4 s tates that the maximum liability for a city for any claim is $500,000 w ith an aggr egate maximum of $1,5 0 0 ,000 per incident. I n pas t years the E DA has chos en not to w aive the liability limits and the regular premium for insurance has covered all claims . I f the E DA w ere to w aiv e the limits set by statute, it would be prudent to pur chas e addi(onal insurance coverage to cov er pos s ible higher awards in liability claims . P remiums for s uch ins urance would be approximately $135 per y ear. B udget I ssues: T he 2021 budget an(cipates leaving the no w aiv er op(on in place for 2021 and has an(cipated insurance premiums bas ed on that no w aiv er op(on. Waiv ing the s tatutory limits w ould r equir e that approximately $135 in addi(onal premium cos ts be allocated for 2 0 2 1 and in each succeeding y ear. S trate gic Priories and Values: S afe, S ecure, S table C ommunity AT TA C H M E N TS : D escrip(on Upload D ate Ty pe E DA Res olu(on for N on-Waiver of liability limits 1/6/2021 Resolu(on L e=er Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO._______________ RESOLUTION OPTING NOT TO WAIVE LIMITED TORT LIABILITY FOR 2021 WHEREAS, the Economic Development Authority of the City of Brooklyn Center has an option to waive its protection under the tort liability limitations contained in Minnesota Statutes 466.04; and WHEREAS, the statutory tort limit for 2021 is $500,000 per individual with an aggregate limit of $1,500,000 per incident; and WHEREAS, the Economic Development Authority of the City of Brooklyn Center has not opted to waive its rights to limited tort liability in past years and is required to make a declaration of its intention every year. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority of the City of Brooklyn Center, Minnesota, that the Authority does not waive the monetary limits on municipal tort liability established by Minnesota Statutes 466.02 for 2021. January 11, 2021 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. E conomic Development A uthority DAT E:1 /11/2 0 2 1 TO :C ity Council F R O M:C ur t Boganey, C ity M anager T H R O U G H :N/A BY:M eg B eekman, Community D ev elopment D irector S U B J E C T:Res olu*on A pprov ing the S econd A mendment to L ease A greement and Reloca*on A s s is tance A greement w ith S heng Z heng, Wang L in, L in, I nc., O pera*ng Under the Trade Name "O cean Buffet" and A latus Br ookly n Center B ackground: O n November 12, 2 0 1 3 , the E D A adopted Res olu*on N o. 2013-17, w hich authorized the acquis i*on of certain parcels to facilitate redev elopment opportuni*es within the O ppor tunity S ite of the former Brookdale S quare S hopping C enter. O n D ecember 23, 2 0 1 3 , the E D A clos ed on the pr oper *es and became the ow ner of the 2 3 .2 acre commercial s ite w hich included a number of leas es , including the O cean Buffet s tand alone res taurant. The city worked w ith exis *ng busines s es within the center to nego*ate voluntary ter mina*ons of leases and ul*mately demolis hed the s hopping center, leaving only the O cean Buffet res taur ant r emaining on s ite. O cean Buffet's curr ent lease expires in Nov ember 2 0 2 1 ; however, they have w ithin the lease a five year op*on which they can exercis e if they choos e. O ver the years the city has been in communica*on w ith O cean Buffet's ow ner s hip to make them aw are of the city 's long term goal to r edevelop the site, but no formal reloca*on or leas e amendment nego*a*ons have occurred. More recently the city and O cean Buffet have been in communica*on about poten*al redevelopment of the s ite. A latus has con*nued their preliminary planning for a dev elopment proj ect and has iden*fied the s outhw est corner of the s ite as the preferred loca*on. Before a development w ould be able to proceed, O cean Buffet's leas e would need to be amended to be terminated and the city would be obligated to pay reloca*on benefits . W hen a government agency acquires proper ty owned or leased by a private bus ines s reloca*on benefits are required to be paid out under s tate law. Reloca*on benefits can be paid out in one of tw o w ays . 1) T he gov ernment agency pays the actual cos t of r eloca*on, up to a certain maximum amount under state law, for the busines s to move into a new loca*on; or 2) the bus iness receives a fixed payment amount in lieu of reloca*on as an up fr ont pay ment. The amount of the fixed payment is determined bas ed on the past three years income of the bus iness and is capped at $4 0 ,000. T he city, A latus and O cean Buffet ow ners hip met to dis cuss their op*ons and determine a path forw ard. T he terms agr eed to and encompas s ed in the aDached agreement are as follow s : 1. The E DA w ould pay O cean Buffet a fixed pay ment w ithin 30 days of execu*ng this agreement in an amount of $40,0 0 0 . 2. A latus w ould pay O cean Buffet a leas e ter mina*on payment amount of $3 0 0 ,000 at the *me of clos ing on the pr operty. 3. O cean B uffet agrees to terminate the leas e and w aiv e their extension at clos ing of the sale of the proper ty, pr ovided that occurs on or befor e D ecember 31, 2021. 4. The E DA w ould agree to waive rent payments dur ing the remaining ter m of the leas e. O cean Buffet w ill con*nue to be res pons ible for any r eal es tate taxes, u*lity payments , or addi*onal payments above and beyond the minimum annual rent being w aiv ed while they r emained in bus iness. 5. I n the event that A latus does not acquir e the E D A property and the pr oject does not proceed, O cean Buffet retains the right to exercise their leas e extens ion under the curr ent terms of the lease; how ever, the E DA 's reloca*on obliga*on will have been met by this agreement an w ould not need to be paid again to facilitate a future redevelopment. T he purpos e of s tructur ing the agreement in this w ay w ill allow O cean Buffet to operate their busines s in a w ay that is financially feasible for them betw een now and w hen a clos ing might occur. I t als o provides the city with a maximum liability in terms of reloca*on obliga*on. I n the event that the closing doesn't occur and the project does n't pr oceed the city's reloca*on obliga*on w ill have been met by this agreement. T he S econd A mendment to L eas e A greement and Reloca*on A s s is tance A greement was draFed by the C ity ADorney and w ould be a three-party agreement between the E DA , O cean Buffet's owners, and A latus . T he agreement is aDached to this memo. The agr eement does not obligate the C ity or E DA in any way to A latus or the development proj ect; how ev er, it does obligate A latus to pay O cean Buffets L eas e buy -out in the ev ent that the proj ect moves forward. B udget I ssues: $40,000 fixed payment in lieu of reloca*on fr om T I F 3 pooled administra*v e funds . S trate gic Priories and Values: Targeted Redevelopment AT TA C H M E N TS : D escrip*on Upload D ate Ty pe Res olu*on 1/4/2021 Resolu*on L eDer S econd A mendment to L eas e A greement and Reloca*on A ssistance A gr eement 1/4/2021 Backup M aterial P res enta*on 2/16/2021 P resenta*on BR305-1-692681.v1 Commissioner _________________ introduced the following resolution and moved its adoption: EDA RESOLUTION NO. 2021-____ RESOLUTION APPROVING THE SECOND AMENDMENT TO LEASE AGREEMENT AND RELOCATION ASSISTANCE AGREEMENT WITH SHENG ZHENG, WANG LIN, LIN, INC., OPERATING UNDER THE TRADE NAME “OCEAN BUFFET” AND ALATUS BROOKLYN CENTER WHEREAS, the Economic Development Authority of Brooklyn Center, Minnesota (the “Authority”) is the owner of certain premises known as Store #5810 consisting of 8,100 rental square feet located at 5810 Shingle Creek Parkway, Brooklyn Center, Minnesota (the “Premises”); and WHEREAS, the Authority leases the Premises to Sheng Zheng, individually, Wang Lin, individually, and Lin, Inc., operating under the trade name “Ocean Buffet” (collectively, the “Tenant”); and WHEREAS, the Authority and the Tenant’s predecessors in interest entered into a Lease Agreement for the Premises on March 10, 2011 (the “Lease”) and the Lease was amended in March of 2016 by the Authority and the Tenant; and WHEREAS, the Authority intends to sell property that includes but may not be limited to the Premises to Alatus Brooklyn Center, a Minnesota limited liability company (the “Purchaser”) for the purpose of redevelopment, including the demolition of the Premises; and WHEREAS, the Tenant is eligible to receive relocation services and assistance from the Authority provided under the Minnesota Uniform Relocation Act, Minnesota Statutes, Section 117.52 if it is required to relocate due to the redevelopment of the Premises; and WHEREAS, the Authority contracted with a relocation consultant to provide relocation services to the Tenant; and WHEREAS, the Authority’s consultant has provided relocation services to the Tenant and advised the Tenant of its rights under the Minnesota Uniform Relocation Act; and WHEREAS, the Authority and the Tenant have reached an agreement that requires payment of $40,000 by the Authority to the Tenant for Tenant’s relocation assistance; and WHEREAS, the Tenant has also agreed to terminate the Lease early and the Purchaser has agreed to pay the Tenant an early termination payment of $300,000 if the sale of the Premises to the BR305-1-692681.v1 Purchaser occurs; and WHEREAS, during the remaining term of the Lease (until December 31, 2021), the Authority has agreed that Tenant does not need to pay any Minnimum Annual Rent under Section 4.01(a) of the Lease, but shall remain obligated to pay Additional Rent and Percentage Rent; and WHEREAS, in the event that the sale of the Premises does not occur by December 31, 2021, the Tenant shall have the right to notify Landlord, by email, of its exercise of the Option Term under the terms of the Lease up until December 31, 2021, but no further relocation payments will be due to the Tenant because the Tenant’s continued occupancy of the Premises after it has received the relocation payment is an occupancy that begins after the date of the property’s acquisition for the project under 49 C.F.R. 24.2(a)(9)(ii)(B); and NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Economic Development Authority of Brooklyn Center, Minnesota (the “Board”), as follows: 1. The EDA hereby approves the Second Amendment to Lease Agreement and Relocation Assistance Agreement substantially in accordance with the terms set forth in the form presented to the Board, together with any related documents necessary in connection therewith (collectively, the “Lease Amendment and Relocation Documents”) and hereby authorizes the President and Executive Director to negotiate the final terms thereof and, in their discretion and at such time as they may deem appropriate, to execute the Lease Amendment and Relocation Documents on behalf of the Authority, and to carry out, on behalf of the Authority, the Authority’s obligations thereunder. 2. The approval hereby given to the Lease Amendment and Relocation Documents includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel to the Authority and by the officers authorized herein to execute said documents prior to their execution; and said officers are hereby authorized to approve said changes on behalf of the Authority. The execution of any instrument by the appropriate officers of the Authority herein authorized shall be conclusive evidence of the approval of such document in accordance with the terms hereof. In the event of absence or disability of the officers, any of the documents authorized by this Resolution to be executed may be executed without further act or authorization of the Board by any duly designated acting official, or by such other officer or officers of the Board as, in the opinion of the City Attorney, may act in their behalf. 3. Upon execution and delivery of the Lease Amendment and Relocation Documents, the officers and employees of the Authority are hereby authorized and directed to take or cause to be taken such actions as may be necessary on behalf of the Authority to implement the Lease Amendment and Relocation Documents. 4. The Board hereby determines that the execution and performance of the Lease Amendment and Relocation Documents will help realize the public purposes of the Economic Development Authority Act. BR305-1-692681.v1 _________________________ _________________________________ 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. 1 SECOND AMENDMENT TO LEASE AGREEMENT AND RELOCATION ASSISTANCE AGREEMENT This Second Amendment to Lease Agreement and Relocation Assistance Agreement (“Second Amendment”) is entered by and between Economic Development Authority of Brooklyn Center (“Landlord” or “City”) and Sheng Zheng, individually, Wang Lin, individually, and Lin Inc., operating under the trade name Ocean Buffet (collectively “Tenant”) and Alatus Brooklyn Center, a Minnesota Limited Liability Corporation, its subsidiaries and assignees (collectively referred to as “Purchaser”) (collectively, the “Parties”). RECITALS A. On March 10, 2011, Centro Saturn Holdings SPE, LLC, a Delaware limited liability company, Landlord’s predecessor in interest, and Zheng Asian, Inc., a Minnesota corporation, Tenant’s predecessor interest, entered into a Lease Agreement (“Lease”) whereby Tenant’s predecessor in interest leased, for a term of one hundred twenty (120) full calendar months beginning on the Commencement Date, from Landlord’s predecessor in interest that certain premises known as Store #5810 consisting of 8,100 rentable square feet located at 5810 Shingle Creek Parkway, Brooklyn Center, Minnesota 55430 (the “Premises”). B. In March 2016, Landlord and Tenant entered an Amendment to Lease (“First Amendment”). C. Landlord intends to sell the property that includes but may not be limited to the Premises (“Property”) to Purchaser for the purpose of the Property’s redevelopment, including the demolition of the Premises. D. Under the Minnesota Uniform Relocation Act, Minnesota Statutes, Section 117.52 (“Relocation Act”), should Tenant be required to relocate to facilitate the Property’s redevelopment, Tenant will be a “displaced person” and eligible to receive all relocation services and assistance provided under the Relocation Act. E. In anticipation of the potential sale of the Property, Landlord has engaged a relocation consultant, SRF Consulting, to provide all relocation services to Tenant required under the Relocation Act. F. SRF Consulting has provided relocation services to Tenant and advised Tenant of its rights to financial assistance under the Relocation Act, including without limitation the preparation of a Business Relocation Claim in the form of a Fixed Payment in Lieu of Actual Move and Reestablishment Payments (“Relocation Claim”) (Attachment A). 2 G. The Parties have reached an agreement as to the provision of relocation assistance and lease termination, as set forth below. AGREEMENT 1. Recitals. All recitals are incorporated by reference as terms of this Second Amendment. 2. Relocation Assistance. The total amount of relocation assistance for which Tenant is eligible to receive under the Relocation Act is $40,000. Upon executing this Second Amendment, Tenant shall execute the Relocation Claim and submit it to the City for processing. Within thirty (30) days of receipt of the executed Relocation Claim, City shall pay Tenant $40,000 (“Relocation Payment”). Tenant has been informed of its right to appeal the City’s decision regarding the amount of assistance available under the Relocation Act and, in exchange for the consideration outlined in this Second Amendment, waives its right to appeal the City’s decision The City’s payment of the Relocation Claim is non-refundable. Should the City and Purchaser fail to close on the sale of the Property, City and Tenant shall make a good faith attempt to agree on the terms of a new lease (see below). Regardless of whether the City and Tenant agree on the terms of a new lease, Tenant shall be ineligible for further relocation services or assistance. Tenant acknowledges that its continued occupancy of the Premises after it has received the Relocation Payment is an occupancy that begins after the date of the Property’s acquisition for the project under 49 C.F.R. 24.2(a)(9)(ii)(B) (definition of non-displaced persons). The City’s payment of the Relocation Claim is conditioned on Tenant not defaulting under the Lease, as modified under the terms of this Second Amendment. 3. Lease Termination and Early Termination Payment. The Lease, and the options to extend the same, shall terminate upon and merge into the closing of the sale of the Property, provided such sale and closing occurs in 2021. In exchange for the early termination of the lease and extinguishment of the options to extend the term, and contingent upon the closing of the Property to Purchaser in 2021, at closing Purchaser shall pay Tenant $300,000.00 (“Early Termination Payment”). The Early Termination Payment is conditioned upon Tenant’s timely vacancy of the Premises, as provided under the Lease. In the event the closing of the sale of the Property does not occur by December 31, 2021, then the Lease and its amendments shall remain in full force and effect, including Tenant’s options to extend the same. If the closing of the sale of the Property does not occur, Tenant shall have the right to notify Landlord, by email, of its exercise of the Option Term under the terms of the Lease up until December 31, 2021, notwithstanding any notice requirements to the contrary under the terms of the Lease, with such notice becoming effective upon transmission of email notice to Landlord. 3 4. Rent. During the remaining term of the Lease, but excluding any Option Term, and provided that Tenant continues to operate its business at the Premises, Tenant shall pay $0.00 in Minimum Annual Rent under Section 4.01(a) of the Lease, but shall remain obligated to pay Additional Rent and Percentage Rent. In the event that Tenant ceases operations of its business at the Premises during the remaining term of the Lease, but excluding any Option Term, then during the time in which Tenant is not operating, Tenant shall pay $0.00 in Rent, as that term is defined in Article IV of the Lease, including but not limited Minimum Annual Rent, Percentage Rent, and Additional Rent. Tenant shall notify Landlord in writing or via email at least 30 days in advance of ceasing operations in order to allow adequate time for proper building close up and transfer of payment obligations. 5. Governing Law. This Second Amendment is governed and controlled as to validity, enforcement, interpretation, construction, effect and in all other respects by the statutes, laws and decisions of the State of Minnesota. 6. Counterparts/.pdf Signatures. This Second Amendment may be executed in one or more counterparts, each of which shall be deemed an original, but all of which when taken together shall constitute one agreement. Signatures sent by .pdf via e-mail may be used in place of original signatures. 7. Entire Agreement. This Second Amendment is the entire agreement of the parties with respect to the lease amendment and payment of relocation assistance. The terms and conditions of this Agreement shall be and are binding on each of the party’s assignees and/or subsidiaries, including but not limited to the payment obligations of Landlord and Purchaser. Except as expressly provided in this Second Amendment, all other provisions of the Lease and First Amendment are not modified and remain in effect. 8. Effectiveness. The submission of a draft or copy of this Second Amendment for review or signature is not an offer to enter into a legally binding agreement and may not be relied on for legal or equitable rights or obligations. The Parties shall be bound by the terms of this Second Amendment only upon its execution by both parties. By executing the Second Amendment, Purchaser is obtaining no rights or obligations under, nor does it become a party to, the Lease or First Amendment. 9. Assignment. This Second Amendment may not be assigned without the City’s prior written consent. 4 10. Recording. The Parties agree that a Memorandum of Lease may be filed with the County Recorder or Registrar of Titles for the purposes of providing notice concerning the existence of this Agreement and lease for the Premises. The Parties have executed this Second Amendment on the dates specified under their respective signatures. [signature page follows] 5 [Signature Page to Second Lease Amendment and Relocation Assistance Agreement] TENANT: ____________________________ Sheng Zheng _____________, 2021 ____________________________ Wang Lin _____________, 2021. Lin Inc., a Minnesota corporation _____________________________ By: Its: _____________, 2021. LANDLORD/CITY: Economic Development Authority of Brooklyn Center _____________________________ By: Mike Elliott Its: President _____________, 2021. ____________________________ By: Curt Boganey Its: Executive Director _____________, 2021. 6 PURCHASER: Alatus Brooklyn Center LLC _____________________________ By: Its: _____________, 2021. 7 Attachment A Relocation Claim [attached] 2/16/2021 1 Second Amendment to the Lease Agreement  and Relocation  Assistance Agreement with  Ocean Buffet EDA Meeting, January 11, 2021 Meg Beekman, Community Development Director  Background 2 •November 12, 2013 –EDA authorized acquisition of certain parcels to  facilitate redevelopment of the Opportunity Site, including Brookdale  Square Shopping Center •December 23, 2013 –EDA closed on the properties and became the  owner of the 23.2 acre site, including a number of leases •Among them, Ocean Buffet, a stand along restaurant  •EDA worked with existing businesses to negotiate voluntary  terminations of leases and demolish the shopping center •Ocean Buffet remained 2/16/2021 2 Background 3 •Ocean Buffet’s current lease expires in November 2021 •They have a five year option which they can exercise at that time if  they choose •Base rent: $9,281.25/month, plus CAM and utilities •City and Ocean Buffet’s ownership have been in communication over  the years regarding redevelopment of the site •No formal negotiations had occurred until now. Background 4 •When a government entity acquires property owned or leased by a  private business, relocation benefits are required to be paid under  state law.  •Relocation benefits can be paid in one of two ways.  •1) The actual cost of relocation, up to a certain maximum amount under state  law, is reimbursed for  the business to move into a new location; or  •2) the business receives a fixed payment amount in lieu of relocation as an up  front payment. The amount of the fixed payment is determined based on the  past three years income of the business and is capped at $40,000.  2/16/2021 3 Background 5 •Alatus has continued with their pre‐development and identified the  southwest corner of the Opportunity Site as the preferred location •Alatus has initiated an Environmental Assessment Worksheet  (EAW)  process which will take 4‐6 months to complete •Before a redevelopment could occur on the site, Ocean Buffet’s lease  would need to be amended to allow termination in the event of a  redevelopment and the EDA’s relocation obligations would need to be  fulfilled •Recently discussions began with Ocean Buffet related to this topic Proposed Terms 6 •Three‐party agreement •The EDA agrees to pay Ocean Buffet a fixed payment within 30 days of  executing this agreement in an amount of $40,000 •Alatus would pay Ocean Buffet a lease termination payment amount of  $300,000 at the time of closing on the property  •Ocean Buffet agrees to terminate the lease at closing of the sale of the  property or on December 31, 2021, whichever occurs first  •The EDA would agree to waive rent payments during the remaining term of  the lease. Ocean Buffet will continue to be responsible for any real estate  taxes, utility payments, or additional payments above and beyond the  minimum annual rent being waived if they choose to remain open for  business.  2/16/2021 4 Proposed Terms 7 •Allows Ocean Buffet to continue operating if they choose under current  difficult financial times •Provides the EDA with a maximum liability for  relocation that is a known  quantity regardless of whether the development moves forward or not •In the event that the project does not move forward, Ocean Buffet current  lease would continue to be in effect and they would retain their right to  exercise an extension.   •If that occurs, the EDA may have to negotiate a lease buy‐out in the future  if another redevelopment occurs •The agreement does not obligate the EDA in any way to Alatus or a  redevelopment on the site. It does obligate Alatus to pay for Ocean Buffet’s  lease buy‐out in the event that a redevelopment does move forward.  Requested Action 8 ‐Motion to authorize approval of a Resolution Approving the Second  Amendment to Lease Agreement and Relocation Assistance Agreement  with Sheng Zheng, Wang  Lin, Lin, Inc., Operating Under the Trade  Name  "Ocean Buffet" and Alatus Brooklyn Center E conomic Development A uthority DAT E:1 /11/2 0 2 1 TO :C ity Council F R O M:C ur t Boganey, C ity M anager T H R O U G H :Reggie Edwards, D eputy C ity C lerk BY:Barb S uciu, City Clerk S U B J E C T:Res olu*on E lec*ng O fficers for the Economic D evelopment A uthority in and for the C ity of Br ookly n Center B ackground: Minnes ota S tatute 4 6 9 -0 9 6 prov ides that an Economic D evelopment A uthor ity s hall elect a president, treasurer, and s ecretar y on an annual basis . E D A Resolu*on N o. 87-06 als o s tates in A r*cle I I , S ec*on 7, that the pres ident, v ice-president, secretary, treasurer, and as s is tant tr eas urer shall be elected at the annual mee*ng of the A uthority and shall hold office for one y ear or un*l succes s ors are elected and qualified. T he a;ached r es olu*on elects s uch pos i*ons for the Economic D evelopment A uthor ity. B udget I ssues: T here are no budget is s ues to cons ider. S trate gic Priories and Values: O pera*onal E xcellence AT TA C H M E N TS : D escrip*on Upload D ate Ty pe E DA Bylaw Res olu*on 1/8/2020 Backup M aterial Res olu*on 1/5/2021 Resolu*on L e;er Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. _______________ RESOLUTION ELECTING OFFICERS FOR THE ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER, MINNESOTA WHEREAS, Minnesota Statutes Section 469.096 provides that an economic development authority shall elect a president, treasurer, and secretary on an annual basis. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority of Brooklyn Center, Minnesota, that the Authority hereby elects the following officers to serve through December 31, 2021, or such later date as their successors are elected and qualified: President/Treasurer Vice-President Assistant Treasurer Secretary January 11, 2021 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.