10-16-18 HRA Agenda Packet
A G E N D A
Regular Meeting of the
Housing and Redevelopment Authority
Golden Valley City Hall
7800 Golden Valley Road
Council Chamber
October 16, 2018
6:30 pm
Pages
1. Roll Call
2. Approval of Agenda
3. Approval of Minutes - Regular Meeting - July 17, 2018 2-3
4. Reimbursement of City Expenditures 4
5. Receipt of September 2018 Financial Reports 5-7
6. Winnetka/Medicine Lake Redevelopment Agreement
A. Consider Fourth Amendment to Liberty Crossing Private Development
Agreement
8-13
B. Amending Resolution No. 16-06 Relating to the Liberty Crossing Winnetka-
Medicine Lake Road Tax Increment Project of the City and Approving the
Interfund Loan 18-05
14-16
7. Adjournment
UNOFFICIAL MINUTES
HOUSING AND REDEVELOPMENT AUTHORITY MEETING
GOLDEN VALLEY, MINNESOTA
July 17, 2018
Housing and Redevelopment Authority Chair Clausen called the meeting to order at 6:30 pm.
1. Roll Call
The following members were present: Chair Joanie Clausen, Commissioners Larry Fonnest,
Shep Harris, Gillian Rosenquist and Steve Schmidgall. Also present were HRA Director
Cruikshank and City Clerk Luedke.
2. Approval of Agenda
MOTION made by Commissioner Schmidgall, seconded by Commissioner Harris to approve
the agenda of July 17, 2018, as submitted and the motion carried.
3. Approval of Housing and Redevelopment Authority Minutes - Regular Meeting -
April 17, 2018
MOTION made by Commissioner Schmidgall, seconded by Commissioner Harris to approve
the Regular Housing and Redevelopment Authority minutes of April 17, 2018, as submitted
and the motion carried.
4. Reimbursements of the City Expenditures
MOTION made by Commissioner Schmidgall, seconded by Commissioner Fonnest to
approve Check #4087 for $191,106.88 to the City of Golden Valley and Check #4088 to Bank
Mutual for $12,374.12 and the motion carried.
5. Receipt of June 2018 Financial Reports
MOTION made by Commissioner Harris, seconded by Commissioner Schmidgall to receive
and file the June 2018 HRA Financial Reports and the motion carried.
6. Appointment of Housing and Redevelopment Authority Attorney
HRA Director Cruikshank presented the staff report.
MOTION made by Commissioner Rosenquist, seconded by Commissioner Schmidgall to
appoint Ms. Maria Cisneros as the Housing and Redevelopment Authority Attorney and the
motion carried.
Housing and Redevelopment Authority Minutes July 17, 2018
Page 2
7. Adjournment
MOTION made by Commissioner Harris, seconded by Commissioner Schmidgall and the
motion carried to adjourn the meeting at 6:34 pm.
_______________________________
Joanie Clausen, Chair
ATTEST:
_________________________
Kristine A. Luedke, City Clerk
Executive Summary For Action
Golden Valley Housing and Redevelopment Authority Meeting
October 16, 2018
Agenda Item
4. Reimbursement of City Expenditures
Prepared By
Sue Virnig, Finance Director
Summary
As of September 30, 2018 the following expenditures will be paid by the HRA:
HRA Expenditures
9300 Hwy 55 West 109,466.50
$109,466.50
Recommended Action
Motion to approve Check 4088 for $109,466.50 to Golden Villa, LLC.
Executive Summary For Action
Golden Valley Housing and Redevelopment Authority Meeting
October 16, 2018
Agenda Item
5. Receipt of September 2018 Financial Reports
Prepared By
Sue Virnig, Finance Director
Summary
Attached are the October 2018 Financial Reports for Housing and Redevelopment Authority
(HRA) review. Staff will address questions from the HRA before or at the meeting.
Attachments
• HRA General Fund Budget Report (1 page)
• HRA Capital Project Funds Report (1 page)
Recommended Action
Motion to receive and file the September 2018 HRA Financial Reports.
Percentage Of Year Completed 75%
Over % Of
2018 July-Sept YTD (Under)Budget
Revenue Budget Actual Actual Budget Received
Interest Earnings (2)0 0.00 0.00 0.00
Fund Balance 15,000 0.00 12,276.25 (2,723.75)
Totals $15,000 0.00 12,276.25 (2,723.75)81.84%
Over % Of
2018 July-Sept YTD (Under)Budget
Expenditures Budget Actual Actual Budget Expended
Legal Services (1) $3,000 0.00 276.25 (2,723.75)9.21%
Audit 12,000 0.00 12,000.00 0.00 100.00%
Totals $15,000 0.00 12,276.25 (2,723.75)81.84%
Notes:
(1) Includes to date billings from Best & Flanagan & Audit costs.
(2) Interest will be allocated at year end.
HRA of Golden Valley
General Fund
September 2018 Budget Report (unaudited)
HRA Of Golden Valley
2018 Financial Report 9300 9302 9400 9250
Hwy 55/Cornerstone Winnetka North
West TIF (4)Med Lk Rd Wirth #3
Cash Balance @ 07/01/18 $118,419.80 ($529.44)$0.00 $12,374.12
Add:
Receipts:
Interest
Lease revenue
Increment Received 0.00 0.00 0.00 0.00
Less:
Expenditures:
City of Golden Valley (1)
Payment to Bank Mutual (3)(12,374.12)
Payment to Golden Villa (1)(109,466.50)
TIF Payment-Hennepin County 0.00 0.00 0.00 0.00
Cash Balance @ 09/30/18 $8,953.30 ($529.44) $0.00 $0.00
(2)(2)(3)
(1) Breakdown on City Expenditures Memo
(2) Reimbursed when increment is received.
(3) Pay Go Note remaining $175,439.01; Ck #4088 is outstanding - change of banks needs to be approved
(4) Lot split allowed property onwer to pay later-will receive in Dec 2018.
Capital Project Funds
Executive Summary For Action
Golden Valley Housing and Redevelopment Authority Meeting
October 16, 2018
Agenda Item
6. A. Consider Fourth Amendment to Liberty Crossing Private Development Agreement
Prepared By
Marc Nevinski, Assistant HRA Director
Summary
Liberty Crossing Investment Partners, LLC (Developer) has requested modifications to the Development
Agreement. The proposed modifications include:
1. Changing the completion date to September 30, 2019. Staff and the Developer anticipate the
majority of the project will be completed well before this date; however this date was chosen
to allow for final placement of landscaping and other site finishes in the spring and summer of
2019.
2. Reducing in the Letter of Credit securing the Developer’s construction obligations from $2.5M
to $750,000. At the onset of the project, the Developer delivered a letter of credit in the
amount of $3.5M to the City. The letter of credit was subsequently reduced to $2.5M in July
2017 (Second Amendment) and was scheduled to be reduced to $1.5M (third amendment).
This Fourth Amendment proposes a further reduction to $750,000. A security reduction
schedule was not included in the original development agreement and these periodic
reductions are in response to the Developer’s requests to reduce the security as the project
nears completion. To date the developer has received final or temporary certificates of
occupancy for ninety percent of the units, with the remaining ten percent under construction.
3. Requiring the Developer to screen the utility meters on all townhome units.
Attachments
• Fourth Amendment to Liberty Crossing Private Development Agreement (5 pages)
Recommended Action
Motion to approve the Fourth Amendment to Liberty Crossing Private Development Agreement.
FOURTH AMENDMENT
TO
LIBERTY CROSSING PRIVATE DEVELOPMENT AGREEMENT
THIS FOURTH AMENDMENT TO LIBERTY CROSSING PRIVATE
DEVELOPMENT AGREEMENT (“Fourth Amendment”), is made and entered into,
effective as of ____________________, 2018, by and between THE HOUSING AND
REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF GOLDEN VALLEY, a
public body corporate established and existing under Minnesota Statutes, Section
469.001 et seq., with its principal offices at 7800 Golden Valley Road, Golden Valley,
Minnesota 55427 (the "HRA"), and LIBERTY CROSSING INVESTMENT PARTNERS,
LLC, a Minnesota limited liability company, with its principal office at 3020 France Avenue
South, Minneapolis, Minnesota 55416 (“Developer”).
WHEREAS, the HRA and Developer entered into that certain Liberty Crossing
Private Development Agreement, effective April 29, 2016, recorded as Document
No. T05343990 in the Office of the Hennepin County Registrar of Titles, as amended by
the First Amendment to Liberty Crossing Private Development Agreement, effective as of
July 11, 2017, recorded as Document No. T05460731 in the Office of the Hennepin
County Registrar of Titles, the Second Amendment to Liberty Crossing Private
Development Agreement, effective as of December 19, 2017, recorded as Document No.
T05500242 in the office of the Hennepin County Registrar of Titles, and by the Third
Amendment to the Liberty Crossing Private Development Agreement, effective as of
February 20, 2018 recorded as Document No. T05514940 in the office of the Hennepin
County Registrar of Titles (as amended, collectively the “Private Development
Agreement”), concerning the Development Property (as defined in the Private
Development Agreement) legally described on attached Exhibit A and incorporated herein
by reference; and
WHEREAS, the HRA and Developer wish to make certain changes to the Private
Development Agreement as set forth herein;
NOW, THEREFORE, in consideration of the foregoing, and in consideration of the
mutual terms and conditions contained herein, the parties hereby agree as follows:
1. All capitalized terms used but not defined herein shall have the meanings
given to them in the Private Development Agreement.
2. Section 4.2 of the Private Development Agreement is revised to change the
completion date for 100 percent (100%) of the apartment building Improvements to on or
before September 30, 2019, and to change the completion date for 100 percent (100%)
of the townhomes Improvements to on or before September 30, 2019. Developer agrees
that these changes to the completion dates as set forth herein shall not in any way affect
the Assessment Agreements, including the dates by which certain minimum market
values are required under the Assessment Agreements.
3. Section 4.6 of the Private Development Agreement is revised in its entirety
to state as follows:
A. Letter of Credit. Developer has previously delivered to the HRA, at
Developer’s sole cost and expense, an irrevocable letter of credit in the
amount of $2,500,000, securing all of Developer’s construction obligations
under this Agreement and the P.U.D. Development Agreement. The letter of
credit in the amount of $2,500,000 shall be reduced and released as follows:
i. The letter of credit shall be reduced to $750,000 following the
execution of this amendment and Developer’s delivery to the HRA of
a revised letter of credit for $750,000 with an expiration date of
September 30, 2019.
ii. Remaining letter of credit in the amount of $750,000 will be reduced
to zero and returned in full upon completion of the Improvements
(as defined in the Private Development Agreement) and upon the
issuance of the Certificate of Completion by the HRA.
The balance of any cash deposits as required under the P.U.D.
Development Agreement shall be fully released upon completion of
the construction of the Improvements, subject to the terms of the
P.U.D. Development Agreement regarding the release and
retainage of the deposits made thereunder, and upon completion of
the Screening Work (as defined in Section 10.14 herein).
B. Any letter of credit referred to in this Section 4.6 shall be in a form and
issued by a bank previously approved by the HRA and all such letters of credit
and cash deposits shall secure all of Developer’s construction obligations
under this Agreement until the Improvements have been completed and shall
be held and released in accordance with this Agreement and subject to the
terms of the PUD Development Agreement regarding the release and
retainage of the letters of credit and deposits made thereunder. Any letter of
credit referred to in this section shall provide for expiration in not less than
one year after date of issuance. At least 30 days prior to the expiration of any
letter of credit referred to in this Section 4.6, Developer shall provide the HRA
with a replacement letter of credit which shall extend at least one year beyond
the expiration date of the letter of credit then in effect or, if earlier, until a date
which is 60 days beyond the contractor’s written estimated date for
completion of the shell of the Improvements, or Developer shall be in default
hereunder with no opportunity to cure and the HRA may immediately draw
upon the letter of credit then in effect.
4. The following Section 10.14 shall be added to the Private Development
Agreement:
“Section 10.14. Developer shall screen all exterior utility boxes on all
townhome units using materials compatible with the approved plans and design
of the townhome units (the “Screening Work”). The Developer shall submit plans
for the Screening Work to the City for review and approval prior to completing the
Screening Work which approval shall not be unreasonably withheld, delayed or
conditioned”.
5. Developer shall pay the reasonable legal fees and expenses incurred by
the HRA and the City in connection with this Fourth Amendment. Developer agrees such
fees will be deducted from interest earned on the cash escrow on deposit with City.
6. Except as amended hereby, the Private Development Agreement continues
in full force and effect. In the event of any conflict between the terms, conditions and
provisions of the Private Development Agreement and this Amendment, the terms,
conditions and provisions of this Amendment shall prevail. This Amendment may be
executed in one or more counterparts, each of which shall for all purposes be deemed to
be an original and all of which shall together constitute one and the same instrument.
IN WITNESS WHEREOF, the HRA has caused this Amendment to be duly executed in
its name and behalf and Developer has caused this Amendment to be duly executed in
its name and behalf, on or as of the date first above written.
THE HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
GOLDEN VALLEY
By:
Joanie Clausen, Chair
And _______________________________________
Timothy J. Cruikshank, Director
LIBERTY CROSSING INVESTMENT PARTNERS,
LLC
By:
Todd Schachtman, Chief Manager
STATE OF MINNESOTA
COUNTY OF HENNEPIN } ss
The foregoing instrument was acknowledged before me this ___ day of
__________________, 2018, by Joanie Clausen, Chair, and Timothy J. Cruikshank,
Director, of THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE
CITY OF GOLDEN VALLEY, on behalf of the organization.
Notary Public
STATE OF MINNESOTA
COUNTY OF HENNEPIN } ss
The foregoing instrument was acknowledged before me this ____ day
of__________________, 2018, by Todd Schachtman, Chief Manager of Liberty Crossing
Investment Partners, LLC, a Minnesota limited liability company, on behalf of the limited
liability company.
Notary Public
DRAFTED BY:
City of Golden Valley
7800 Golden Valley Road
Golden Valley, MN 55427
(763) 590-8000
EXHIBIT A
LEGAL DESCRIPTION FOR DEVELOPMENT PROPERTY
Lots 1-57, Block 1, Liberty Crossing P.U.D. No 123, Hennepin County, Minnesota
Executive Summary For Action
Golden Valley Housing and Redevelopment Authority Meeting
October 16, 2018
Agenda Item
6. B. Amending Resolution No. 16-06 Relating to the Liberty Crossing Winnetka-Medicine Lake
Road Tax Increment Project of the City and Approving the Interfund Loan
Prepared By
Sue Virnig, Finance Director
Summary
The Housing and Redevelopment Authority approved a resolution approving an interfund loan
with the City’s Storm Water Fund for $1,500,000 on October 13, 2016. This amount was based on
the engineering estimate. As the project will be completed shortly, the City will only need
$1,050,000 for the completion of the Liberty project. Other sources of financing for this project
were a Storm Sewer Revenue Bond for $2,580,000 and an interfund loan for $1,000,000. Future
tax increment from the Liberty Project will make payments to the City’s Storm Sewer Fund
Attachments
• Resolution Amending 16-06 Relating to the Liberty Crossing Winnetka-Medicine Lake Road
Tax Increment Project of the City and Approving the Interfund Loan (2 pages)
Recommended Action
Motion to adopt Resolution amending Resolution 16-06 Relating to the Liberty Crossing
Winnetka-Medicine Lake Road Tax Increment Project of the City and Approving the Interfund
Loan.
HOUSING AND REDEVELOPMENT AUTHORITY
RESOLUTION NO.18-05
RESOLUTION AMENDING 16-06 RESOLUTION RELATING
TO THE LIBERTY CROSSING PROJECT
OF THE CITY AND APPROVING THE DEVELOPMENT AGREEMENT
AND INTERFUND LOAN THEREFORE
BE IT RESOLVED by the Board of Commissioners of the Housing and
Redevelopment Authority in and for the City of Golden Valley (the “HRA”), as follows:
1. Recitals.
(a) The HRA and the City of Golden Valley, Minnesota (the “City”) adopted the
Redevelopment Plan for the Winnetka and Medicine Lake Road Project Area (the
“Plan”), together with the Tax Increment Financing Plan (the “TIF Plan”) for Tax
Increment Financing District (Redevelopment), Winnetka Avenue North & Medicine
Lake Road No. 1 (the “District”); all pursuant to and in conformity with applicable law,
including Minnesota Statutes, Sections 469.174 to 469.1794, all inclusive, as
amended (the “Act”).
(b) In accordance with the TIF Plan, the HRA proposes to undertake a project with
Liberty Crossing Investment Partners, LLC, a Minnesota limited liability company
(the “Developer”), consisting of a five-story apartment building with approximately
187 apartments and approximately 55 townhomes, plus parking, landscaping,
utilities and certain other improvements (the “Development”);
(c) The Developer proposes that the HRA enter into a Private Development Agreement
to construct the Development, attached hereto as Exhibit A (the “Development
Agreement”).
(d) In connection with the Development, the City has authorized the loan of up to
$1,000,000 to the HRA from its Storm Utility Fund or other funds available or so
much thereof as may be paid as qualified costs (the “Interfund Loan”).
(e) In connection with the Development, the City has authorized the loan of up to
$1,500,000 to the HRA from its Storm Utility Fund or other funds available or so
much thereof as may be paid as qualified costs (the “Interfund Loan”). With this
amendment the amount of the loan on October 16, 2018 be approved for the amount
of $1,050,000 due to the actual costs are lower than the estimated cost.
2. Approval of Development Agreement. The Development Agreement is hereby approved
and the Chair and Director are hereby authorized to enter into the Development Agreement
by and among the HRA and the Developer.
3. Approval of Interfund Loan.
(a) The HRA approves the Interfund Loan. The City shall be reimbursed such amount,
together with interest at the rate stated below. Interest accrues on the principal
amount from the date of each loan. The maximum rate of interest permitted to be
HRA Resolution No. 18-05 -2-
charged is limited to the greater of the rates specified under Minnesota Statutes,
Section 270C.40 or Section 549.09, as of the date the loan is made, unless the
written agreement states that the maximum interest rate will fluctuate as the interest
rates specified under Minnesota Statutes, Section 270C.40 or Section 549.09, are
from time to time adjusted. The interest rate shall be 4% and will not fluctuate.
(b) Principal and interest (“Payments”) on the Interfund Loan shall be paid semi-
annually in two (2) equal installments per year, each installment to be paid within ten
(10) business days of receipt by the City of property tax revenues from Hennepin
County (the “Payment Dates”), commencing on the first Payment Date on which the
City has Available Tax Increment (defined below), or on any other dates determined
by the City Finance Director, through the date of last receipt of tax increment from
the HRA pursuant to the TIF Plan (the “maximum term”).
(c) Payments on this Interfund Loan are payable solely from “Available Tax Increment,”
which shall mean, on each Payment Date, tax increment available after other
obligations have been paid for the preceding six (6) months with respect to the
Development Property and remitted by Hennepin County, all in accordance with
Minnesota Statutes, Sections 469.174 to 469.1799, as amended. Payments on the
Interfund Loan may be subordinated to any outstanding or future bonds, notes or
contracts secured in whole or in part with Available Tax Increment, and are on parity
with any other outstanding or future interfund loans secured in whole or in part with
Available Tax Increment.
(d) The principal sum and all accrued interest payable under this Interfund Loan are pre-
payable in whole or in part at any time by the HRA without premium or penalty. No
partial prepayment shall affect the amount or timing of any other regular payment
otherwise required to be made under this Interfund Loan.
(e) This Interfund Loan is evidence of a loan in accordance with Minnesota Statutes,
Section 469.178, subdivision 7, and is a limited obligation payable solely from
Available Tax Increment pledged to the payment hereof under this resolution.
_____________________________
Joanie Clausen, Chair
ATTEST:
_____________________________
Timothy J. Cruikshank, Executive Director