HomeMy WebLinkAboutEDA - June 6, 2017AN66W
1685 CROSSTOWN BOULEVARD N.W. • ANDOVER, MINNESOTA 55304 • (763) 755-5100
FAX (763) 755-8923 • WWW.ANDOVERMN.GOV
ECONOMIC DEVELOPMENT AUTHORITY
MEETING
June 6, 2017
6:00 p.m.
Conference Rooms A & B
1. Call to Order— 6:00 p.m.
2. Approval of Minutes (April 18, 2017 Regular)
3. Discuss Arbor Oaks Senior Living LLC Request -Administration
4. Discuss Presbyterian Homes Request - Administration
5. Review/Discuss Commercial Project Activity -Administration
6. Redevelopment Updates - (verbal)
7. Other Business
8. Adjournment
9CNb6W
1685 CROSSTOWN BOULEVARD N.W. • ANDOVER, MINNESOTA 55304 • (763) 755-5100
FAX (763) 755-8923 • WWW.ANDOVERMN.GOV
TO: Economic Development Authori
CC: Jim Dickinson, City Administrator
FROM: Michelle Harmer, Deputy City Clerk
SUBJECT: Approval of Minutes
DATE: June 6, 2017
INTRODUCTION
The following minutes were provided by Staff reviewed by Administration and submitted
for EDA approval:
April 18, 2017 Regular
DISCUSSION
The minutes are attached for your review.
ACTION REQUIRED
The EDA is requested to approve the above minutes.
Respectfully submitted,
- r) �t 1444 Ll
Michelle Harmer
Deputy City Clerk
Attach: Minutes
1
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5
6 ANDOVER ECONOMIC DEVELOPMENTA UTHORITYMEETING-
7 APRIL 18, 2017 -MINUTES
8
9
10 The Meeting of the Andover Economic Development Authority was called to order by President
11 Julie Trude, April 18, 2017, 6:00 p.m., at the Andover City Hall, 1685 Crosstown Boulevard
12 NW, Andover, Minnesota.
13
14 Present: Commissioners Sheri Bukkila, James Goodrich, Valerie Holthus,
15 Mike Knight, and Joyce Twistol
16
17 Absent: Timothy Cleven
18
19 Also present: Executive Director, Jim Dickinson
20 Community Development Director, Joe Janish
21
22
23
24 APPROVAL OFMINUTES
25
26 February 21, 2017, Regular Meeting: Correct as written.
27
28 Motion by Goodrich, Seconded by Bukkila, to approve the minutes as written. Motion carried
29 unanimously.
30
31 REVIEW COMMERCL4L PROJECT ACTIVITY
32
33 Mr. Janish reviewed the following:
34
35 The Shops @ Andover, 13650 Hanson Boulevard- Dunkin' Donuts is open. Joy Kitchen and
36 Natural Nails are expected to open by the end of the month.
37
38 Commissioner Goodrich asked if the building will have adequate parking once the other two
39 businesses open. Mr. Dickinson answered parking should not be an issue since peak times for
40 the businesses are at different times of the day.
41
42 Mr. Janish indicated the ribbon cutting ceremony for Dunkin' Donuts is scheduled for May 5th at
43 3:00 p.m.
44
45 Estates at Arbor Oaks/Trident Development, 1753 156`f' Lane- Drywall work is being
46 completed. They are working from the 3` floor down.
47
48 President Trude asked if a rental license is required for this senior facility. Mr. Janish stated City
Andover Economic Development Authority Meeting
Minutes—April 18, 2017
Page 2
1 Code does not require a rental license for senior facilities. President Trude requested the code be
2 checked regarding this issue since this luxury senior facility is not an assisted living facility.
3
4 Eight Unit Townhome Building, 18264840130 Ave. — Construction is complete, landscaping
5 is remaining.
6
7 Andover Cinema, 1836 Bunker Lake Blvd — The cinema is underway with the remodeling to
8 different seating.
9
10 Daycare Interest- Staff has worked with two separate daycares interested in building new
11 facilities in Andover. One at Clocktower Commons, the other is along Round Lake Boulevard.
12 They are both in final negotiations with the current property owners.
13
14 Mr. Janish indicated staff received an application for an amendment to the Clocktower Commons
15 PUD regarding the parcel where the daycare facility would like to build.
16
17 Overall Marketing — Staff continues to work with parties interested in investing in Andover.
18
19 REVIEW/DISCUSS PROJECT PROPOSAL (S)
20
21 Mr. Janish stated staff has been contacted by businesses interested in current available properties,
22 by a commercial broker doing an analysis for a business and developers interested in developing
23 multi -family housing.
24
25 Mr. Janish indicated single-family developments will include Catcher's Creek 2"a Addition and
26 Winslow Woods 2"d Addition. He stated Winslow Woods 2"d Addition was marketed to
27 National Builders and has heard the property owner is working with a developer.
28
29 President Trude asked about the rare plants that were found on the Winslow Woods site. Mr.
30 Janish explained the situation between Anoka County and the Minnesota DNR regarding the rare
31 plants and believes the regulation standard has been set.
32
33 Mr. Janish stated there has been some interest in the property on Crosstown Boulevard and
34 Hanson Boulevard south of Clocktower Commons, more a mixed use (multi -family, senior living
35 and commercial) for the property. He believes the current asking price is quite high.
36
37 Commissioner Knight asked about the property on 7th Avenue and Bunker Lake Boulevard. Mr.
38 Janish indicated there has been some interest in the property for multi -family housing.
39
40 President Trude asked about the property south of Bunker Lake Boulevard and 7th Avenue. Mr.
41 Janish said that parcel would have limited road access which could make the parcel less
42 appealing to a developer. President Trude suggested slab on grade townhomes for that parcel.
43
44 The Andover Station area was discussed, focusing on the TCF parcel and 2288 Bunker Lake
45 Boulevard.
Andover Economic Development Authority Meeting
Minutes—April 18, 2017
Page 3
REDEVELOPMENT UPDATES
3 Mr. Dickinson indicated nothing is up for sale at this time in the redevelopment area (Bunker
4 Lake Boulevard between Crosstown Boulevard and Crosstown Drive). He continued, at this
5 time this type of housing is making money for the property owners. Mr. Dickinson stated
6 developers and builders are apprehensive about spending money on redevelopment, since
7 redevelopment is considered "high risk" and generally requires subsidy.
9 OTHER BUSINESS
10
11 Commissioner Holthus asked about the Sloth Nursery property on Bunker Lake Boulevard. Mr.
12 Janish indicated a new fence has been put up after strong winds brought the old fence down.
13
14 ADJOURNMENT
15
16 Motion by Bukkila, Seconded by Twistol to adjourn. Motion carried unanimously. The meeting
17 adjourned at 6:54 p.m.
18
19 Respectfully submitted,
20
21 Michelle Hartner, Recording Secretary
22
C I T Y 0 Fj^
1685 CROSSTOWN BOULEVARD N.W. • ANDOVER, MINNESOTA 55304 • (763) 755-5100
FAX (763) 755-8923 • WWW.ANDOVERMN.GOV
TO: President and Commissioners
FROM: Jim Dickinson, Executive Director
SUBJECT: Discus Arbor Oaks Senior Living LLC Request
DATE: June 6, 2017
INTRODUCTION
Arbor Oaks Senior Living LLC will be undertaking a HUD refinancing and as part of that
refinancing may be seeking various TIF contract amendments and consents from the City of
Andover in order to complete that refinancing.
DISCUSSION
At the meeting City Administration will provide a background on the request and the impacts
and benefits of a potential proposal. It is anticipated that Roger Fink, representing the Arbor
Oaks Senior Living LLC, will also be present at the meeting to discuss the potential TIF contract
amendments and consents that may be requested of the City. At this point, no formal request has
been made.
City Administration has reviewed "draft" materials from Arbor Oaks and has provided comments
that the City is supportive of a refinance for the Arbor Oaks Senior Living facility in Andover,
but that requested changes will need to be further vetted and reviewed by the EDA.
If a formal request of the City of Andover is made by Arbor Oaks, City Administration would
recommend a $5,000 escrow be required to cover the cost of bond counsel and City Staff.
ACTION REQUESTED
The EDA is requested to receive a presentation and provide direction on how to proceed.
C I T Y O F �•
NDOVER�
1685 CROSSTOWN BOULEVARD N.W. • ANDOVER, MINNESOTA 55304 • (763) 755-5100
FAX (763) 755-8923 • WWW.ANDOVERMN.GOV
TO: President and Commissioners
FROM: Jim Dickinson, Executive Director
SUBJECT: Discus Presbyterian Homes Request
DATE: June 6, 2017
INTRODUCTION
Presbyterian Homes has requested the City of Andover's consideration of a Low Income Rental
Classification (LIRC) for their Farmstead Facility in Andover.
DISCUSSION
At the meeting City Administration will provide a background on the request and the impacts
and benefits of the proposal. The following are attached to assist with the discussion:
• Low Income Rental Classification program description from the Minnesota Housing Finance
website.
• 2017 Application for Minnesota Low -Income Rental Classification for New Applicants.
• Minnesota Statute 273.128A
In summary the request would entail the City entering into an agreement with Presbyterian
Homes that Presbyterian Homes would be required to have at least 20% of the total rental units
in the rental property available for low income residents, in exchange the City would record the
document and allow a tax rate class rate reduction of up to 40 % for the qualifying units in the
income restricted property.
Presbyterian Homes currently has similar agreements with the Cities of Oakdale and Monticello.
Also attached is the agreement with the City of Monticello.
If the City of Andover were to move forward with such an agreement, City Administration
would recommend a $5,000 escrow be required to cover the cost of bond counsel and City Staff.
ACTION REQUESTED
The EDA is requested to receive a presentation from staff and provide direction on how to
proceed.
Low Income Rental Classification (LIRC) Page 1 of 1
Low Income Rental Classification (LIRC)
The tax bill adopted by the Minnesota Legislature In the 2005 legislative session and sgned by the Governor on Wednesday, July 13, 2005
made significant changes to the property, rax classification rate for qualifying lim-,norms rental properties. TIAs reaUl[z n a da5a rate
reduction of up to 40% for qualifying units In some rent and Ilxome-resVictetl properties.
Only those rental properties subsldHed under a federal or state government program or meeting certain rent and Income restrictions are
aligOle for the lower class rate. Applications must be made to Minnesota Homing for decapitation to the local assessor Nat a property
qualities for Ne reduced rate.
Note: It Is the responsibility of the owner to Inform Minnesota Housing of any Mnages plroughOut Ne Vain, Failure to do So may result In
missed communication or the loss of the classification.
Details
py,K1ticabon Rate Is.75%' j K4fiFdLJ piD,-I45.o4J
Qualifying Properties are at least 20% of total units in the rental property must meet ane or moral of the following crlteda:
Project Based Section 8,
• Law Income Homing Tax Credits,
• Rental Assistance units financed through Rural Housing Service of USDA,
��enl and Income resblctlon$ at or below 6O% Area Median Income placed on units by state, federal, or local unit of government as
evidenced by a document recorded against the property.
Note: The lower tax rate applies only to that portion of the rental property meeting all eligibility criteria. The regular rental class rate of
1.25% will apply to the remainder W the properly. Market value determined Cy the assessor must be cased on the standard approach to
valuation using unrestricted market rents.
Application
Application Fee Is $10 per qualifying unit; total fee not to exceed $150. Application deadline March 31 each year for taxes payable the
following calendar year. View this legislation.
Application Farm (fillabie ref) - Downloadable form and Instructions (for new applicants only). The application deadline Is March 31
Note: Personallaed 'Reapplication' forms for Currently enrolled properties are bang sent by mail.
2016 1 IRC Assessor Report
Fremientiv Asked Ouestans
Questions?
Steve O'Brien, 651.297.4065
Toll Free, 1.800.657.3647
http://www.mnhousing.gov/wcs/Satellite?c=Page&cid=1364120490987&pa... 4/19/2017
Minnesota
Housing
Fina ,rice Agency
2017 Application for Minnesota Low -Income Rental Classification for New Applicants
This application must be postmarked by no later than March 31, 2017 or it will not be accepted for pay 2018 tax rate reduction.
Please review eligibility criteria (over) to ensure the property being enrolled qualifies for this tax classification.
Property and Owner Information
Owner federal tax IDp
Ownership Entity Name or name of property owner lfiot, middle, last)
Owner's mailing address(FfO, soretaddress or PO box)
Gty
State
Zip Code
Name of eligible property lwojectl
Primary address ofellglble property (RFD, street address)
at,
MN
Tip Code
Contact name(First, Last, Ml)
Daytime phone
Afteosts phone
Moble pM1ane
Fax
E-mail
County PINS
List the county parcel lD numbers(PINS/?IDS) and associated parcel addresses that collectively identify the primary address
above. if there are more than four PINS/FIDS, list any additional PINS/PIDS and addresses on a separate sheet and attach it to
this application.
PIN
Address
UP
MN
Zip Cade
PIN
Address
City
MN
lip Cade
PM
Address
City
MN
Zip Code
PIN
Address
City
MN
Decode
Number of Qualifying Units
Enter number of units financed under each program listed below. The sum of boxes l - 4 must match
total number of qualified units entered online 5 below.
1. Project Based Section 8 Units
2. Housing Tax Credit—Section 42 Units
3. Rural Housing Development — Rental Assistance Units
4. Units financed by federal, state, or local governments and subject to 60% or less of AMI rent
and income limits
4a. Specify financing programs
Units
5. Qualified Units (sum of units indicated in boxes 1-4 above)
6. Total of all rental units in property
7. Total a nnual fee (multiply line 5 by $10 and enter result or max of $150) -include check for this amount
Unit Distribution Enter number of units by bedroom 51ze. Complete row for total units in project and for qualified units in project. Totals should equal
row 6 and 5 respectively.
OBR 1BR 2BR 3BR 4BR 5BR 61311 TOTAL
Total Units in Property =
Qualified Units in Property =
Owner Certification and Signature
Owner's commitment: I certify that all information provided is true and correct, that the property meets the requirements) to receive the LIRC tax reduction, and
that the property is in compliance with all applicable requirements of the low -Income housing program that qualifies the property for LIRC. I understand that any false
information or low-income housing program non-compliance could result in LIRC non-compliance and loss of some or all LIRC benefits.
Signature of property owner I Data
General Information:
Reapplication: This application is for new applicants only. Use the
Reapplication for re -enrollment.
Eligibility— Minnesota rental properties financed by federal or
state governments in which at least 20% of total units meet any of
the following requirements:
1. Project -based Section 8 housing assistance units,
2. Rent & income restricted Housing Tax Credit units,
3. Rural Housing Development Rental Assistance units,
4. Units financed by federal, state or local governments,
which are subject to 60% or less of AMI rent & income
limits and evidenced by a recorded document.
Application deadline for 2017—Applications and remittances
must be postmarked by no later than March 31, 2017.
How will I know if my application was accepted? —Minnesota
Housing will notify applicants of the status of applications once
they are processed.
How soon does the benefit take effect? —Approved and certified
properties will see the tax rate reduction on their tax bill payable
in 2018.
Owner's responsibility — Apply annually for this benefit, then
continue to comply with all requirements of applicable, eligible
programs listed above.
Change of ownership or mailing address— Property owners are
responsible to notify Minnesota Housing of any ownership or
mailing address changes. Minnesota Housing is not responsible
for misdirected mail.
Definitions:
Account number — Unique identifier assigned to each application
when received at Minnesota Housing. Record & refer to the
account number in future correspondence and inquiries. You will
receive this number from Minnesota Housing at a later date.
Area Median Income (AMI)- Established by HUD and published
annually around mid-February; serves as the basis for rent and
income limits in several low-income housing programs.
Assessment date —January 2 of each year. The date property
value is set for taxes payable the following calendaryear.
Housing Tax Credit Program —an indirect federal subsidy of
qualified low-income housing available under section 42(g) of the
Internal Revenue Code of 1986, as amended and administered by
the Dept. of the Treasury.
PIN or PID — county Parcel Identification Number found on the
property tax statement. Also referred to as parcel code or parcel
number.
Qualifying percentage—percentage of total property units which
qualify under one or more of the eligible programs/criteria listed
above in Eligibility. At least 20% of the total unit's in the property
must meet one or more of eligibility criteria to qualify for URC.
Qualifying unit- unit which qualifies under one or more of the
eligible programs/criteria listed above in Eligibility.
Project based—refers to rental assistance that Is provided for a
specific property and cannot be transferred to another property.
RHS — Rural Housing Service of U. S. Department of Agriculture
RHS/RA— Rural Housing Service Rental Assistance
Rental assistance— direct rentsubsidy administered by any of
several low-income housing programs.
Section 8— Rental assistance program under section 8 of the
United States Housing Act of 1937, as amended (tenant -based
Section 8 vouchers do not qualify for URC).
X
Application instructions:
General: Completely fill out the application. Incomplete
information in any area could result in rejection of the application.
Property and owner information: Complete all fields. If eligible
property has no Name, enter "None."
County PINS: Enter the PIN/PID & parcel address exactly as shown
on your property tax statement. Accuracy of this information is
critical.
Number of qualifying units: 1) In each program field, enter the
number of eligible units subject to rent and income restrictions as
reflected in the applicable contractor restrictive covenant. 2) If
qualifying units fall into category #4, specify in #4a the
applicable federal or state program(s). 3) Enter the total number
of qualifying units From each program field.
Units: 5) Enter the sum of qualifying units from boxes 1-4. 6)
Enter the total number of units in the property. 7) Calculate the
total annual fee -$10 per qualified unit in line 1, but not more
than the maximum fee of $150.00.
Unit Distribution: Enter total number of units broken out by
bedroom size for all units in the project then again for only
qualified units. The total column should be the same as numbers 6
and 5 in the Units section above.
Owner certification and signature: Sign and date the form to
certify that at least 20% of total property units qualify for one or
more of the eligible programs and to certify that the information
provided is correct and complete.
Mailing instructions: 1) Make a copy of the completed application
for your records. 2) Place completed, signed application in an
envelope with a check for the full fee amount, payable to
Minnesota Housing. 3) Mail to: Minnesota Housing, Attn: URC, 400
Sibley St. #300, St. Paul, MN 55101. Late submittals (postmarked
after March 31, 2017) will be returned to the sender and will not
be eligible for tax rate reduction for taxes payable in 2018.
For further information:
Website:
Low Income Rental Classification (URC)
To]] -free:
1.800.657.3647
Metro area:
651.297.4065
TTY: 651.297.2361 or call the Minnesota Relay Service at
1.800.627.3529
Use of information:
Some of the information you provide on your application is private
by state law. It cannot be given to others without your consent,
except to the IRS, other states that guarantee the same privacy,
and certain governmental units as provided by law.
GO
MINNESOTA STATUTES 2016 273.128
273.128 CERTIFICATION OF LOW-INCOME RENTAL PROPERTY.
Subdivision 1. Requirement. Low-income rental property classified as class 4d under section 273. 13,
subdivision 25, is entitled to valuation under this section if at least 20 percent of the units in the rental housing
property meet any of the following qualifications:
(1) the units are subject to a housing assistance payments contract under Section 8 of the United States
Housing Act of 1937, as amended;
(2) the units are rent -restricted and income -restricted units of a qualified low-income housing project
receiving tax credits under section 42(g) of the Internal Revenue Code;
(3) the units are financed by the Rural Housing Service of the United States Department of Agriculture
and receive payments under the rental assistance program pursuant to section 521(a) of the Housing Act of
1949, as amended; or
(4) the units are subject to rent and income restrictions under the terms of financial assistance provided
to the rental housing property by the federal government or the state of Minnesota, or a local unit of
government, as evidenced by a document recorded against the property.
The restrictions must require assisted units to be occupied by residents whose household income at the
time of initial occupancy does not exceed 60 percent of the greater of area or state median income, adjusted
for family size, as determined by the United States Department of Housing and Urban Development. The
restriction must also require the rents for assisted units to not exceed 30 percent of 60 percent of the greater
of area or state median income, adjusted for family size, as determined by the United States Department of
Housing and Urban Development.
Subd. 2. Application. (a) Application for certification under this section must be filed by March 31 of
the levy year, or at a later date if the Housing Finance Agency deems practicable. The application must be
filed with the Housing Finance Agency, on a form prescribed by the agency, and must contain the information
required by the Housing Finance Agency.
(b) Each application must include:
(1) the property tax identification number; and
(2) evidence that the property meets the requirements of subdivision 1.
(c) The Housing Finance Agency may charge an application fee approximately equal to the costs of
processing and reviewing the applications but not to exceed $10 per unit. If imposed, the applicant must pay
the application fee to the Housing Finance Agency. The fee must be deposited in the housing development
fund.
Subd. 3. Certification. By June 1 of each levy year, the Housing Finance Agency must certify to the
appropriate county or city assessors, the specific properties that are qualified under this section and the
number of units in the building that qualify. In making the certification, the Housing Finance Agency may
rely on the application and any other supporting information that the agency deems necessary from the
property owner.
History: 1Sp2005 c 3 art I s 14; 2008 c 154 art 2 s 10; 2008 c 366 art 11 s 12
Copyright (0 2016 by the Revisor of Statutes. State of Minnesota. All Rights Reserved.
AMENDED AND RESTATED
CONTINUING AFFORDABLE SENIOR HOUSING AGREEMENT
BY AND BETWEEN
THE CITY OF MONTICELLO
AND
PHS/MONTICELLO, INC.
This document drafted by: Janna R. Severance
Presbyterian Homes and Services
2845 Hamline Avenue North
Roseville, MN 55113
TABLE OF CONTENTS
ARTICLEI.............................................................................................................................
Section1.1. Definitions..............................................................................................
ARTICLEII.............................................................................................................................
Section 2.1. Representations and Warranties of the Citv...........................................
Section 2.2 Representations and Warranties of the Developer
ARTICLEIII...............................................................................................................
Section 3.1.
Compliance With Low and Moderate Income Requirements .....
Section3.2.
Recordation...............................................................................
Section3.3.
LIRC..........................................................................................
ARTICLEIV...............................................................................................................
Section 4.1.
Events of Default Defined..........................................................
Section 4.2.
Remedies on Default.................................................................
Section 4.3.
No Implied Waiver.....................................................................
Section 4.4.
Indemnification of City...............................................................
ARTICLEV.................................................................................................................
Section 5.1
The Developer's Option to Terminate ..........................................
Section 5.2
Effect of Termination...................................................................
ARTICLEVI................................................................................................................
Section 6.1.
Restrictions on Use....................................................................
Section 6.2.
Conflicts of Interest.....................................................................
Section 6.3.
Titles of Articles and Sections .....................................................
Section 6.4.
Notices and Demands................................................................
Section 6.5.
Counterparts..............................................................................
Section 6.6.
Law Governing...........................................................................
Section6.7.
Expiration...................................................................................
Section 6.8.
Legal and Administrative Expenses ............................................
Section 6.9.
Provisions Surviving Rescission or Expiration ............................
Section 6.10.
Effect of Agreement...................................................................
Page
.... 4
4
4
4
4
................ 9
............... 9
Signatures ............................................................. ..... .10-11
Exhibits.....................................................................12-13
2
H
AMENDED AND RESTATED CONTINUING AFFORDABLE SENIOR HOUSING AGREEMENT
THIS AGREEMENT, made as of the 151 day of November 2012, by and between the City of
Monticello, Minnesota (the "City"), a municipal corporation organized and existing under the laws of
the State of Minnesota, and PHS/Monticello, Inc., a Minnesota nonprofit corporation (the "Developer").
WITNESSETH:
WHEREAS, the Developer owns and operates a 49 -unit senior housing building (the
"Project"), which is located within Tax Increment Financing District No. 1-19 (the "TIF District"), a
housing district under Minnesota Statutes, Section 467.176, subd. 11 and also within Redevelopment
Project No. 1 under Minnesota Statutes, Section 469.001 to 469.046; and
WHEREAS, the City, the Housing and Redevelopment Authority in and for the City of
Monticello (the "HRA") and Presbyterian Homes Housing and Assisted Living, Inc., ("PHHAL")
previously entered into a Contract for Private Development dated July 1, 1995 (the "TIF Contract"),
under which the HRA provided certain tax increment financing assistance to facilitate development of
the Project, and the PHHAL agreed to subject a portion of the units in the Project to certain income
and rent restrictions in conformance with Minnesota Statutes, Section 469.1761; and
WHEREAS, Developer is the successor in interest to the PHHAL with respect to the TIF
Contract; and
WHEREAS, the TIF Contract has expired, but Developer is willing to ensure that at least 20%
of the units in the Project continue to meet certain income and rent limits as described in this
Agreement; and
WHEREAS, in consideration of Developer's promise to maintain affordable senior rental
housing in the City for an extended period after termination of the TIF Contract, the City is willing to
facilitate classification of the Project as "qualifying low-income rental housing ("LIRC") within the
meaning of Minnesota Statutes, Sections 273.128 and 273.13, subd. 25(e) (the "Act"), thereby
reducing property taxes for the Project; and
WHEREAS, the Monticello Economic Development Authority ("EDA"), as successor to the
HRA, has requested that the City enter into this Agreement in order to further the EDA's goals of
maintaining the availability of housing for low income elderly persons is vital and in the best interests
of the City of Monticello, the health, safety, morals and welfare of residents of the City; and
WHEREAS, by a resolution approved July 23, 2012, the City Council of the City approved a
Continuing Affordable Senior Housing Agreement (the "Original Agreement") in substantially the form
presented to the Council on that date, subject to modifications that do not alter the substance of the
transaction that are approved by the Mayor and City Administrator; and
WHEREAS, the parties executed the Original Agreement, but have determined a need to
make minor modifications to that document that do not alter the substance of the transaction, and
therefore have decided to execute this amended and rested Agreement, which is intended to
supersede the Original Agreement in all respects.
NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties
hereto, each of them does hereby covenant and agree with the other as follows:
YJ
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. All capitalized terms used and not otherwise defined herein shall
have the following meanings unless a different meaning clearly appears from the context:
Act means Minnesota Statutes, Sections 273.128 and 273.13, subd. 25(e), as amended.
Affiliate means "Affiliate" means with respect to the Developer (a) any corporation, partnership,
or other business entity or person controlling, controlled by or under common control with the
Developer, and (b) any successor to such party by merger, acquisition, reorganization or similar
transaction involving all or substantially all of the assets of such party (or such Affiliate). For the
purpose hereof the words 'controlling", "controlled by" and "under common control with" shall mean,
with respect to any corporation, partnership, corporation or other business entity, the ownership of fifty
percent or more of the voting interests in such entity, possession, directly or indirectly, or the power to
direct or cause the direction of management policies of such entity, whether ownership of voting
securities or by contract or otherwise.
Agreement means this Agreement, as the same may be from time to time modified, amended
or supplemented;
Business Da v means any day except a Saturday, Sunday or a legal holiday or a day on which
banking institutions in the City are authorized by law or executive order to close;
City means the City of Monticello, Minnesota;
Count v means Wright County, Minnesota;
Developer means PHS/Monticello, Inc., its successors and assigns;
Event of Default means any of the events described in Section 4.1 hereof;
Legal and Administrative Expenses means the fees and expenses incurred by the City in
connection with the adoption and administration of this Agreement during its term;
LIRC means qualifying low-income rental housing classification as further defined in the Act.
Proiect means the 49 unit senior citizen residential rental housing facility currently known as
"Mississippi Shores," that' is owned by the Developer and located in the City, legally described in
Exhibit A;
State means the State of Minnesota;
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.1. Representations and Warranties of the Citv. The City makes the following
representations and warranties:
(1) The City is a municipal corporation and has the power to enter into this Agreement and
carry out its obligations hereunder.
111
(2) The low income housing for seniors contemplated by this Agreement is in conformance
with the EDA's and City's objectives to provide affordable housing, and furthers the requirements
previously imposed under Minnesota Statutes, Section 469.1761,
Section 2.2. Representations and Warranties of the Developer. The Developer makes the
following representations and warranties:
(1) The Developer has power to enter into this Agreement and to perform its obligations
hereunder.
(2) The Developer will use its best efforts to obtain, and maintain all required permits, licenses
and approvals, and will meet, in a timely manner, all requirements of all applicable local, state, and
federal laws and regulations which must be obtained or met to operate the Project as senior rental
housing the Project may be lawfully constructed.
(3) Neither the execution and delivery of this Agreement, the consummation of the
transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of
this Agreement is prevented, limited by or conflicts with or results in a breach of, the terms, conditions
or provision of any contractual restriction, evidence of indebtedness, agreement or instrument of
whatever nature to which the Developer is now a party or by which it is bound, or constitutes a default
under any of the foregoing.
ARTICLE III
UNDERTAKINGS BY DEVELOPER AND CITY
Section 3.1. Compliance With Low and Moderate Income Requirements. The Developer
covenants that at least 20% of the residential units in the Project will be occupied by individuals
whose income is 50% or less of area median gross income, adjusted for family size as determined
from time to time by the US Department of Housing and Urban Development ("HUD") the ("50%
Test"). The rent for any such designated unit shall not exceed 30% of 60% of the greater of area or
State median income, adjusted for family size as determined by HUD (the "30% Test"). The Developer
will establish such monitoring procedures with respect to applicants for and occupants of dwelling
units in the Project as the City may reasonably require to ensure compliance with this requirement. On
or before July 1 each year during the term of this Agreement, commencing July 1, 2013, the
Developer shall submit to the City's Community Development Director:
(a) a Compliance Certificate in the form attached as Exhibit B covering the 12 month period
preceding the date of the Compliance Certificate certifying that the Project is in compliance with the
provisions, and
(b) supporting data, if requested by the City and in a form provided by the City, showing at a
minimum (i) the maximum rent under the 30% Test for that reporting year; (ii) the actual rent for all
units; (iii) the maximum income under the 50% Test for that reporting year; and (iv) the actual income
for occupants of all units that meet the 50% Test. Upon request from the City at any time, Developer
shall make available to the City detailed Project records that evidence the conclusions stated in any
Compliance Certificate or supporting data form.
Section 3.2. Recordation. This Agreement, or a Memorandum thereof, at the option of the
Developer, shall be filed with the Wright County Recorder, at Developer's cost.
Section 3.3 LIRC. Developer is solely responsible to seek and obtain LIRC treatment for the
Property in accordance with the Act. The parties agree and understand that Developer will first apply
for LIRC treatment in the 2013 levy year, for taxes payable in 2014, and will seek annual renewal
u
through the 2022 levy year, for taxes payable in 2023. Developer shall notify City in writing each year
promptly after Developer receives notice of the property tax classification for the Property, confirming
whether or not the Property has received LIRC designation for the subject levy year. The City shall co-
operate with the Developer in any effort to obtain and annually renew the status of the Project as
LIRC treatment under the Act for purposes of property taxation in Minnesota and Wright County.
Notwithstanding anything to the contrary herein, the City makes no warranties or representations that
the Property is eligible for, or will receive, LIRC treatment.
ARTICLE IV
EVENTS OF DEFAULT
Section 4.1. Events of Default Defined. The following shall be "Events of Default" under this
Agreement and the term "Event of Default" shall mean whenever it is used in this Agreement any one
or more of the Project:
(a) Failure by the Developer to timely pay any ad valorem real property taxes
assessed with respect to the Project.
(b) Failure of the Developer to observe or perform any other covenant, condition,
obligation or agreement on its part to be observed or performed under this Agreement.
(c) If the Developer shall
(A) file any petition in bankruptcy or for any reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief under the United
States Bankruptcy Act of 1978, as amended or under any similar federal or state law;
or
(B) make an assignment for the benefit of its creditors; or
(C) admit in writing its inability to pay its debts generally as they become due; or
(D) be adjudicated a bankrupt or insolvent; or if a petition or answer proposing the
adjudication of the Developer, as a bankrupt or its reorganization under any present or
future federal bankruptcy act or any similar federal or state law shall be filed in any
court and such petition or answer shall not be discharged or denied within sixty (60)
days after the filing thereof; or a receiver, trustee or liquidator of the Developer, or of
the Project, or part thereof, shall be appointed in any proceeding brought against the
Developer, and shall not be discharged within sixty (60) days after such appointment,
or if the Developer, shall consent to or acquiesce in such appointment.
Section 4.2. Remedies on Default. Whenever any Event of Default referred to in Section 4.1
occurs and is continuing, the City may:
(a) cancel and rescind the Agreement, but only after giving thirty (30) days' written
notice to the Developer and only if the Event of Default has not been cured within
said thirty (30) days;
(b) Take whatever action, including legal, equitable or administrative action, which may
appear necessary or desirable (including without limitation specific performance) to
enforce performance and observance of any obligation, agreement, or covenant
under this Agreement.
Section 4.3. No Implied Waiver. In the event any agreement contained in this Agreement
should be breached by any party and thereafter waived by any other party, such waiver shall be
limited to the particular breach so waived and shall not be deemed to waive any other concurrent,
previous or subsequent breach hereunder.
Section 4.4. Indemnification of City.
(1) The Developer releases from and covenants and agrees that the City, its governing body
members, officers, agents, including the independent contractors, consultants and legal counsel,
servants and employees thereof (hereinafter, for purposes of this Section, collectively the "Indemnified
Parties") shall not be liable for and agrees to indemnify and hold harmless the Indemnified Parties
against any loss or damage to property or any injury to or death of any person occurring at or about or
resulting from any defect in the Project, provided that the foregoing indemnification shall not be
effective for any actions of the Indemnified Parties that are not contemplated by this Agreement.
(2) Except for any willful misrepresentation or any willful or wanton misconduct of the
Indemnified Parties, the Developer agrees to protect and defend the Indemnified Parties, now and
forever, and further agrees to hold the aforesaid harmless from any claim, demand, suit, action or
other proceeding whatsoever by any person or entity whatsoever arising or purportedly arising from
the actions or inactions of the Developer (or if other persons acting on its behalf or under its direction
or control) under this Agreement, or the transactions contemplated hereby or the acquisition,
construction, installation, ownership, and operation of the Project; provided, that this indemnification
shall not apply to the warranties made or obligations undertaken by the City in this Agreement or to
any actions undertaken by the City which are not contemplated by this Agreement.
(3) All covenants, stipulations, promises, agreements and obligations of the City contained
herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of
the City and not of any governing body member, officer, agent, servant or employee of the City, as the
case may be.
ARTICLE V
DEVELOPER'S OPTION TO TERMINATE AGREEMENT
Section 5.1 The Developer's Option to Terminate. This Agreement may be terminated by the
Developer effective upon written notice to the City if no uncured Event of Default under Section 4.1
has occurred and any of the following events has occurred: (i) the City has failed to comply with any
material term of this Agreement, and, after written notice by the Developer of such failure, the City has
failed to cure such noncompliance within sixty (60) days after the date of such notice, or, if such
noncompliance cannot reasonably be cured by the City within said sixty (60) days, the City has not
provided assurances, reasonably satisfactory to the Developer, that such noncompliance will be cured
as soon as reasonably possible, (ii) the Developer has complied with all requirements under the Act to
apply for or renew LIRC classification, but Project has been denied LIRC classification, initially, or
upon any renewal, (iii) the Project is taken by exercise of eminent domain, (iv) the Project is destroyed
or damaged and the cost to replace or repair is estimated to exceed $1 million, (v) the Developer sells
or leases the Project as a whole to any party other than an Affiliate, (vi) the Developer is no longer
controlled, directly or indirectly, by Presbyterian Homes and Services, or (vii) the Act is amended to
materially alter the eligibility criteria for LIRC such that the Project as administered under this
Agreement would not comply; or (viii) the Act is amended to materially increase the LIRC tax rate.
Section 5.2 Effect of Termination. If this Agreement is terminated pursuant to this Article V,
this Agreement shall be from such date forward null and void and of no further effect; provided,
however, the termination of this Agreement shall not affect the rights of either party to institute any
action, claim or demand for damages suffered as a result of breach or default of the terms of this
Agreement by the other party, or to recover amounts which had accrued and become due and
payable as of the date of such termination. Upon termination of this Agreement pursuant to this Article
V, the Developer shall be free to operate the Project without regard to the provisions of this
Agreement.
ARTICLE VI
ADDITIONAL PROVISIONS
Section 6.1. Restrictions on Use. The Developer agrees that during the term of this Agreement
it shall operate, or cause to be operated, the Project as an elderly residential rental housing facility
that meets the affordability requirements described in this Agreement.
Section 6.2. Conflicts of Interest. No member of the governing body or other official of the
City shall have any financial interest, direct or indirect, in this Agreement or the Project, or any
contract, agreement or other transaction contemplated to occur or be undertaken thereunder or with
respect thereto, nor shall any such member of the governing body or other official participate in any
decision relating to the Agreement which affects his or her personal interests or the interests of any
corporation, partnership or association in which he or she is directly or indirectly interested. No
member, official or employee of the City shall be personally liable to the City in the event of any
default or breach by the Developer or successor or on any obligations under the terms of this
Agreement.
Section 6.3. Titles of Articles and Sections. Any titles of the several parts, articles and
sections of the Agreement are inserted for convenience of reference only and shall be disregarded in
construing or interpreting any of its provisions.
Section 6.4. Notices and Demands. Except as otherwise expressly provided in this
Agreement, a notice, demand or other communication under this Agreement by any party to any other
shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage
prepaid, return receipt requested, or delivered personally, and
(a) in the case of the Developer is addressed to or delivered personally to:
PHS/Monticello, Inc.
2845 Hamline Ave. North
Roseville, MN 55113
Attn: CFO
(b) in the case of the City is addressed to or delivered personally to the City at:
City of Monticello
505 Walnut Street
Monticello, MN 55362
or at such other address with respect to any such party as that party may, from time to time, designate
in writing and forward to the other, as provided in this Section.
Section 6.5. Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall constitute one and the same instrument.
Section 6.6. Law Governing. This Agreement will be governed and construed in accordance
with the laws of the State.
G
Section 6.7. Expiration. This Agreement shall expire at the end of the tax -levy year ending
December 31, 2022, unless earlier terminated or rescinded in accordance with its terms.
Section 6.8. Legal and Administrative Expenses. Developer shall pay all City out of pocket
Legal and Administrative Expenses, within 10 Business Days after receipt of a written invoice from the
City reasonably describing the costs incurred.
Section 6.9. Provisions Surviving Rescission or Expiration. Section 4.4 shall survive any
rescission, termination or expiration of this Agreement with respect to or arising out of any event,
occurrence or circumstance existing prior to the date thereof. Further, Developer's obligation to pay
any Legal and Administrative Expenses incurred prior to the effective date of termination or expiration
of this Agreement shall survive under Sections 5.1 or 6.7.
Section 6.10. Effect of Agreement. This Agreement supersedes and replaces in all respects
the Original Agreement referenced in the seventh recital clause on page one of this Agreement.
IN WITNESS WHEREOF, the City has caused this Agreement to be duly executed in its name
and on its behalf and its seal to be hereunto duly affixed, and the Developer has caused this
Agreement to be duly executed in its name and on its behalf, on or as of the date first above written.
STATE OF MINNESOTA
E1M
COUNTY OF+1Ef4NEPtN-
THE CITY OF MONTICELLO
By
Its Mayor
By /,�5
Its CIV&20histrator
The foregoing instrument was acknowled ed before me this �� 1 da of
\, l � y
20 _, by \ � �� �—ySLv � f and
the Mayor and City Administrator, respectively, of the City of
Mo ello, a municipal corporation under the laws of Minnesota, by and on behalf of said city.
DENAA WAflD
104k— eDWnouc.MiIta soT� Notary Pubhc
AryCWPftW E�Jm.3b 2D15
This is a signature page to the Continuing Affordable Senior Housing Agreement by and between the
City of Monticello and PHS/Monticello, Inc.
10
STATE OF MINNESOTA
ss.:
COUNTY OF 14ENNEPW
RAHS3y
�b
PHS/MONTICELLO, INC.
By �-
Its C_
The foregoing instrument was acknowledged before me this .2151, day of
Rolja jtu 20 12. , by nark itc '!r' the
au fi nainact ofFize 1. of PHS/Monticello, Inc., a nonprofit corporation under the laws of
Minnesota by and on behalf of said corporation.
� nrmrmnnn�nnnn�
JANNA R. SEVERANCE
Notary Public•Minnesota
pMy commission Expires Jon 31, 2015
This is a signature page to the Continuing Affordable Senior Housing Agreement by and between the
City of Monticello and PHS/Monticello, Inc.
11
D
EXHIBIT A
Legal Description of Project
Lot 2, Block 2, and Lot 2, Block 3, Monticello Big Lake Community Hospital District
Campus, according to the recorded plat thereof, Wright County, MN (Abstract Property)
12
ON of
COMPLIANCE CERTIFICATE
The undersigned of PHS/Monticello, Inc does hereby certify that as
of the date of this Certificate (i) not less than 20% of the residential units (the "Set -Aside Units") in the
Project as defined in the Continuing Affordable Senior Housing Agreement dated as of
20 between the City of Monticello and PHS/Monticello, Inc. (the "Agreement') are occupied by
individuals whose income is 50% or less of area median gross income, as adjusted for family size, as
determined by the US Department of Housing and Urban Development ("HUD"), and (ii) the rents for
the Set -Aside Units do not exceed 30% of 60% of the greater of area or Minnesota median income,
adjusted for family size, as determined by HUD.
Dated this _ day of 2012.
PHS/MONTICELLO, INC.
M
Its
13
Minnesota LIRC
Wousina
05/03/2013
LIRC Account # 501988
Mississippi Shores;
1213 Hart Blvd
Monticello. MN 55362
Dear Property Owner:
We have reviewed your Application for Mississippi Shores for a Certification as a
Low Income Rental Property (LIRC). We will be certifying to the appropriate
county or city assessor that 20% (10 of 49 units) of your property qualifies for
the LIRC property class rate of .75 percent.
In making this certification, we have relied on information you provided, as well
as information from United States Department of Housing and Urban Development
(HUD), Low -Income Housing Tax Credit administrators, the Metropolitan Council's
Housing and Redevelopment Authority, the Minneapolis Public Housing Authority,
the St. Paul Public Housing Authority, and the Rural Housing Service of the
United States Department of Agriculture.
Please review the enclosed summary of your application. MHFA will submit this
information to the appropriate city or county assessor, if the information is
correct, nothing more is required of you.
If there is any erroneous information shown, draw a line through this
information and write in your correction. Please return the corrected form to
MHFA, Attn: LIRC, 400 Sibley St Suite 300, St.Paul, MN 55101. Please return the
corrected information within ten (10) days.
If you have questions, you may call me at 651-297-4065, or (toll-free at 800-657-
3647 ask for Steve O'Brien) or send an e-mail to steve.obrien@state.mn.us.
Sincerely,
Minnesota Housing Finance Agency
Steve O'Brien
�•
2013 Application
Mi inanmce A' nHousing L I RC
Fce/iq
05/03/2013
,MRC Account # 501988 Application Year: 2013
(Property and owner information
jProperty: Mississippi Shores County: Wright
Address : 1213 Hart Blvd
Monticello, MN 55362
PHS MONTICELLO, INC
2845 HAMLINE AVE N
ROSEVILLE, MN 55113
Federal ID:41-1819439
Contact Intormation
Mame Janna Severance
HONE Number (651)631-6125
MOBILE Number:
ALTERNATE Number:
FAX Number
!E -Mail Address
Parcel Information
City
ZiDCOde -
FIN Address
1155.106.002.020 1213 Hart Blvd
Monticello
55362
1155.106.003.020 1213 Hart Blvd
Monticello
55362.
Status of LIRC units -
SB HTC
RA OTH OTH
Description
Total '.
1. Qualifying Units
10
10
2. Total Units In Property
49
v nna�ifvina nercentaae
20.0'
1685 CROSSTOWN BOULEVARD N.W. • ANDOVER, MINNESOTA 55304 • (763) 755-5100
FAX (763) 755-8923 • WWW.ANDOVERMN.GOV
TO: President and Commissioners
FROM: Jim Dickinson, Executive Director
SUBJECT: Review Commercial Project Activity
DATE: June 6, 2017
INTRODUCTION
Staff will provide a progress report on ongoing commercial project activity at the meeting.
ANDOVER COMMERCL4L PROJECTS
• The Shops @ Andover, 13650 Hanson Boulevard NW Natural Nails is open. Dunkin
Donuts is open. Joy Kitchen has their CO and is working on satisfying Anoka County
Health items. Twin Cities Dental has a permit ready to be picked up.
• Estates at Arbor Oaks / Trident Development, 1753 156th Lane NW — Carpet is being
installed on the 2nd and 3`d floors.
• Eight Unit Townhome Building, 1826 through 18401391h Ave. NW— Is completed and
rented.
• Andover Cinema, 1836 Bunker Lake Blvd NW— completed May 4d .
• Daycare Interest - City Staff have been working with Mother Goose on their
Commercial Site Plan. Another Daycare facility has expressed interest in locating in
Andover as well.
• Restaurams/Fast Food — Currently staff is aware of two type of facilities looking for
land to locate in Andover.
• Med Express —expects to have an event on June 20 from noon to 2 pm with an expected
ribbon cutting ceremony at their location within Walgreens. C.O. is expected on June 2,
2017 Benson Orth was the General Contractor.
• Upper Midwest Athletic Construction — City Council will review a CUP request for
exterior storage at 3017 1615 Ave.
• State Farm Insurance —has located next to Festival Foods
• Former Andover Liquor Store —Staff was contacted by a possible manufacturer looking
at the building last week. The company will walk through the building and contact staff
if they are interested in pursuing the site.
Overall marketing - City Staff continue to work with parties interested in investing in
Andover and marketing all commercial sites.
submitted,
Jim