4.1. SR 12-22-1997~ .y of
iver
MEMORANDUM
Item # 4.1.
TO:
.~ FROM:
DATE:
SUB,JECT:
Mayor & City Council
Paul T. Steinman, Director of Economic
Development
December 22, 1997
Consider Purchase Agreement with
Country Ridge, Inc.
Issue
The issue before the City Council at this time is to review an expenditure of
up to $198,769 from Tax Increment District No. 5 which would go toward
purchase of an approximately 4.4 acre parcel from Country Ridge, Inc., Tony
Emmerich, president, in the Elk River West Business Park.
Background
The following activities have taken place over the past six months regarding
this potential land purchase:
· Tax Increment Financing Plan for Tax Increment Financing
District No. 5 was modified to allow this additional expenditure.
· Staff negotiated a possible land purchase with several property
owners.
· Staff recommended to the EDA that a land purchase with Tony
Emmerich be completed by the end of 1997.
The EDA unanimously supported proceeding with the purchase of
approximately 4.4 acres from Tony Emmerich in the Elk River West
Business Park.
· Emmerich agreed to sell the land to city/EDA for $1 per square foot
to cover cost of land and pay off all levied assessments against the
property.
· Council approved the platting process of Outlot B, Country
Crossing Business Center, to create an approximately 4.4 acre lot
fronting on Joplin Street NW.
13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · TDD & Phone: (612) 441-7420 · Fax: (612) 441-7425
· City Attorney David Sellergren has researched title work and
drafted a purchase agreement with Country Ridge, Inc. for the
purchase of such lot.
· City Attorney David Sellergren has drafted a Joint Development
Agreement for the remainder of Tony Emmerich's property which
will allow the city/EDA extensive flexibility in the marketing of the
remainder of this property. Such agreement is to be signed as part
of the land purchase by the city.
· A Phase I Environmental Assessment has been ordered and is in
the process of completion for the lot to be purchased by the city, and
the surrounding approximately 14 acres to be marketed by the
city/EDA through the Joint Development Agreement with Tony
Emmerich.
$198,769 represents the specific dollar amount of excess tax increment in Tax
Increment District No. 5. A breakdown of the proposed expenditure is as
follows:
· $190,000 - purchase price ($1 per square foot for fully improved
land)
· $1,500 - Phase I environmental site assessment
· ??? - City Attorney fees
· ??? - Other closing costs
The portion of the $198,769 which may be unspent upon completion of this
transaction is required to be returned to the county as undesignated excess
tax increment dollars.
The expenditure of these excess TIF funds from District No. 5 carries with it
the same limitations which apply to any other use of tax increment funds.
One of the most important limitations was the necessity to spend these
excess TIF funds prior to the end of the year, due to the planned
decertification of TIF District No. 5 at the end of 1997.
The City Council has ultimate control over the use of these excess TIF funds
and therefore is being asked at this time to follow the unanimous vote of the
EDA and support the use of these dollars to facilitate this land purchase.
Additionally, since the piece of land being purchased is zoned for business
park development, it is appropriate for the City Council to transfer
ownership to the EDA upon completion of the transaction.
Recommendation
Staff is recommending that the Council approve an expenditure of up to
$198,769 in excess tax increment dollars from Tax Increment Financing
District No. 5 for the purchase of approximately 4.4 acres from Country
Ridge, Inc. in the Elk River West Business Park and that upon closing of this
transaction, the property be transferred from the city to the Economic
Development Authority.
Attachments
· Plat
· Draft Purchase Agreement
council\wstbsnpk.doc
CROSSING BU$1NE$$ C£NTER $ECOND ADDITION
TOTAL PLAT AREA: 798,597 S.F., or 18.53 Ac*/-
_..~ ........ : ~.._~.;;~.~,_~_~..~
~ '~,. ~ '.?
'" :~ I ....
RUSINESS CFNTER DRIVE
CITY OF ELK RIVER,
SHERBURNE COUNTY,
608,596 sq.ft,
or 1.3.97 Acres
A
LOT t
IgO,O00 sq.ft.
4.36 Acres
BLOCK t
COUNTRY .~.'¢E~-~..'!! H.W CROSSINO
C 0 UN T;",Y
\ I?-\ PROPOSED
~1 I~1 E~ITY PURCHASE ,~
I III OF LOT 1, BLOCK 1 ....
:
MN.
John Oliver & Assootates
SN[[T 2 OF 2 SHE~'T~
LOCA'r ~ o.o.o
3P
:11C
City of
13065 orono Parkway · P.O. Box 490
Elk River, MN 55330
ZONING
MAP
11:42 DAB MINNEAPOLIS a 4419425 N0.484 POO5x005
R~Ck-iVED OF'
the sum
at
Date:
Form 1519CIPA I (N~,~ ~i~4:~; C=.. St. F,-ul. ~
¢OM~ER¢I~LolNDUSTRIA/
PURCHASE AGEI:EME~T
This form approved by the Minnesota Assoclatlen of
REALTORS®, which disclaims any liability arleing
oW or' use or misuse or this form.
( $1 000 00 ) DOLLARS
as earnest money and in pan payment for the purchase of prop~'ty
situated in the
County of .~herburne , State of Minneso~ and legally described ss follows: that part ofOurlo! R Country_ Cro~sing
Business Center to be replsr~ed ~s Lot 1 Block 1 Country_ Cro~in[Bu~ine~ Center 2nd Addition_ ac depicted on the attache.d,.
drawing
together with the followini personal property:. None
all or which property the undersigned has this day sold to the Buyer for the sum of: O-e I-Iundred Ninety. Thouiand ~md No/100 ,.
( S 190_0'-~O__ 00 ) DO~, which thc Buyer agrc:s to pay in the Following manner.
Earnest rnon~ herein paid $1_000 00 and _ I;189 000 00 cash, on De.tuber 29 1997 , the date of
closing adlXltllgi:~llral~ ~ XX XXX~~.d~0~
1. DEED/MARKETABLE TITLE: Subject to performance by the Buyer, the ~eller agrees to execute and deliver a Zecordable _~eneral
W,~rranty Deed conveying marketable title to said premises subject only to tho following excrptions:
(a) Building and zoning laws, ordinmces, Slate and F~lcrai regulations. ~c~gallMteli~i~i~~:~il~l~Kig~ig~N~rs, alat
' ' (c) R~tion of any minerals or mineral zights to the State oi' Minnesota. Cd) Utility and drainage
easements whi~ do not interfere with present improvements. (e) Rights ot'tamants as follows: None. (f) U6~lity ~nd dr'alnsge
e~sernents which do not interfere with_in?ended improvemente
2. REAL ESTATE TAXES. Real estate taxes due and payable in the year or clc~!~: shall be prorated between Seller and Buyer on a calendar
ye~ basis to the actual date of closing unle~.s otherwis~ provided in this AgreemenL Real estate ~.xes payable in the years prior lo closing shall
be paid by Seller. Real estate taxes payable ia the years subsequent tn closi~ shall be paid by Buyer.
3, SP~CLLL ASS£SSlV[ENTS. ·
SELLI~R SHALL PAY on the date et' closin~ all installments ot special a.s~ssmaxts r. cr6ficd for payment with thc real estate taxcs du~ and
payable in ~e year of closing.
l~trike out one.] ~'~L~.,,~tt~[,~l,x~tifasl~xxi SELLER SHALL PAY ON DATE OF CLOSENG all other special msessmcnts
lcvi~d as of the date of this Agr~.m~t.
[$trik, out o~.] ~X¥ SET .T.I~.R SHALL PROVIDE PAYMENT OF special assessments pending
ss of the date of this Agreement for improvements that have been ordered by the City Council or other governmenrld assessing authorities.
(S¢ll~s provision rot payment shall b~ by payment into mcrow of 1½ timga tl~ e~imated amount of the ass~sments.)
If a special ass~sment b~oraes pending after the date of this Agreement and before the date of closing, Buyer may, at Buyer's option:
Assume payment of thc pending special assessment without adjustmen~ to the purcha.~ pri~; or Co) RCcluirc Seller to pay the pen~iing special
assessment (or escrow for pay~nent ol' same a sum equal to 1 ~ times the projected pending assessment) and Buyer shall pay a commensurate
increase in the pur~ase price or~¢ property, which irta~-~ shall be the same as the estimated amount oft, he assessmentl or (c) Decl0.r~ this
Agrcr. rn~n! null and void by notic~ lo Seller, and earnest money shall be rcrun~i to Buyer. Seller shall pay on date o£ closing any d¢£erred real
osram er special assessments paymeat or which is required as a result of the closi~ oCthis sale.
4. PRORATIONS. Ail items customarily prorated and adjusted in coea~ectlon with the closing of the sale o£the property herein in¢lucling but not
limited to rents, operating ~p~ases, interes~ on any debt sssum~d by Buyer, shall be proralod u.s of the dat~ ofclosLng. It shall be assumed that
the Buyer will own the property for the enLir~ date of the closing.
DAM. AGES TO REAL PROPERTY. If thcr~ is any loss or damage to the prol~rty bet~cn thc date her~or and the date or closing, for any
reason, the risk of loss shall be on thc Seller. Il'thc properly is destroyed or submarttial[y damaged hal-ore thc closing, this Purchase Agreement
shall become null and void. at Buyer's elation. ~uyer shall have the ri~! to lel'~itlate this P~JrChas~ A~reemet~t within ilo days after Seller
notifies Buy~ or such damage. Upon said termination, the earnest money ~ be refunded to Buyer and Buyer and Seller agree ~o sign a
cancellation of Purchase Agreement.
MNCI:PA-I (i 1/93)
12x1?x97 11:43 DRB MINNEAPOLIS + 4419425 N0.484 POO4x005
Form I$19CIPA 2 o~,) u~,i, c~. ~,~a)t
COMMERCIAL-INDUSTRIAL
PURCHASE AGREEMENT
Ad~s .......
Page 2
6. I~X~ATION OF TITLE. ~~;ti~ att~ acceptance of this A~eement. Seller shall f~sh Buyer ~ an Abs~act of
T{fle or a ~e~/s~red Pro.fly Abaft codified lo ~tc ~cludin~ p~r s~ covcrin~ ~p~ies ~d S~te ~d Fcdc~l
l~cns, ~d lc~ed ~d p~ding ~ ~~. Buyer ~l ~v~ ~ ~ ~ rcccip~ of ~e Abs~t of Ti~e or ~eg/stered
~o~y Ab~ct ~i~ ~ have Bu~s ~ ~e ~e ~fle ~d pro~ ~ll~ ~ ~li~n obj~c~o~ or, at Buy~s o~ expemc,
m~e ~ appli~tion for · fi~e ~ ~ ~d notify Seller of ~e ~o~ Buy~ ~1 ~ve ~b~in~ ~ys ~er receipt of
~cnt for ~c ~sur~ to pm~de Se~ ~ ~ ~py of~ comment ~ ~n obj~fions, Buyer sh~l bc deemed to have ~ived
a~y floe objec~o~ not ~c ~ ~o appli~bi~y ~dM ~t fo~ ~ve. except ~t ~s ~ll no~ op~r~[c ~ a waiver ~
days ~m receipt of Buyers ~[t~ fi~e obje~ons ~ no,fy Buyer of ~Ic~s ~t~fion to ~c ~tlc ~ke~blc ~in~doys ~om
receipt of ~ch ~itt~ objection, ff no,ce [s ~iven, ~en~ h~e~er ~ ~I ~ post.ned ~n~ng co.teflon of ~tle, but upon
co~ect[on of~Oc ~d ~ 10 ~ a~ ~u~ notice to Boy~ ~c ~i~ ~ ~o~ ~is ~rch~se A~ecment a~ording to i~ te~s.
no ~h no,ce is ~vcn or if no~ ~ ~iv~ but rifle ~ not ~ ~n ~e ~e p~vid~ for. ~s ~e ~m~t sh~l be null
voi~ at option of Bu~ nei~ p~y s~ ~ li~bl~ for ~es h~eunder ~ ~e o~ ~d e~t mon~ s~l be re~nded to Buyec, Buyer
~d Sell~ a~e to si~ c~llation of ~ ~menL ff rifle ~ ~e ~ ~ fo~d ~k~ble or ~ so made ~Odn said ~c.
Buy~ s~l deI~ult ~ any of~ a~c~ ~ con,nut in dcfuuR for s ~ of 10 ~. ~en ~d in ~a~ c~c ~ Seller ~y te~ina~ ~is
con~t ~d o~ ~ te~tion ~l ~c ~ ~e u~n ~is con.ct ~1 ~ re~ned by Scll~ ~ iiqui~t~d d~gcs, tim~ bein~ of~c
~ce. ~s prov~ion shall ~ot d~ve ~ ~y of ~c d~t m ~o~ ~c ~ific ~rfo~ of ~ con~act prodded ~s con.ct
not ~ ~i~t~ ~ provid~ ~on m ~o~ ~h ~cific ~o~ ~I1 ~ co~cn~ ~n six mon~ aRer such ri~t
or ~on ~l~sc, * or esccoved at Buyer s sole discretion.
8. ~PRESE~ATIONS ~ W~~ ~ a~c~
9. T~ ~ OF ~ ESSENCE FOR A~ PRO~SIONS OF ~S CO~.
10. WELL D~CLOS~ STATE~NT. Buy~ h~ r~eiv~ ~ ~11 di~lo~e ~m~t r~o~d by M~eso~ Statutes Sec. l
B~R ~ 5E~ER ~: Buy~r(O
12, M~CE~OUS PRO.IONS.
(a) 5u~vsl. ~l of~e ~ ~~o~, ~d cov~ offs ~ ~1 ~ve ~d ~ e~o~e~ble a~ ~e closing.
~) Ent~ ~reement; Modifica~ ~ ~t ~ ~e ~ ~t ~tx~ ~e p~es ~d supersedes ~y prior
or~ or ~ a~en~ ~ ~ ~ re~g ~ pro~y. ~ ~ no ver~ ~~ ~t change ~s A~eemeut
(O 5uccesso~ ~ud Assigns. [f~is ~t ~ ~i~d, ~l p~vSioM offs ~ment s~ali be biM~ on succ~sors ~d assi~s,
13. ACCEPT~CE DE~. ~ cfi= ~ ~, ~[em ~p~ s~, ~ ~ nu~ ~d void st 11:59 PM,
and in such cvmt all earnest money skall be r~fund~d to Buyer.
THIS IS A LEGALLY BINDING CONTRACT. IF NOT UNDERSTOOD, SEEK COMPETENT ADVICE.
Dated: Dated:
City of Elk River
By:
SELLER
Country Ridge Partnership
By:
SELLER.,, P~rr~r
i~UYER
11:43 DRB MINNEAPOLIS + 4417425 N0.484 P005/005
Form 1519 J 0~. Is.) Miller/Davis Co.. St. Paul. MN
ADDENDUM TO
PURCHASE AGREEMENT
This fo~ approved by the Minnesota ~sociation of
R~TORS~. Minnesota Association of R~LTORS~
disclaims any liability arlstng out of use or misuse of thls form.
1. Date ,19
2. Page ~ of .3 Pages
Addendum to Put, ese Agreement ~een pa~ies dated ,19 ~ pe~aining to the
purchase and sale of the pm~ at ~at pa~ of Ouflot B Coun~ Crass~g Business Center to be
7. 1_ geller r~ esent~ and wan'an~ that there is no "individual _~_c'~v~ge txeatment sy. ~lem" within lhe mennin_e of' IVfinn SlAt-
9. 2_ _ geller re.~r~ent~ that the nndeaxi_~! ha~ _i~en thfly aulhoriTed t~ ex~.ctue and deliver thle Agreement
10. 3 _geller r .e.e.e.e.e.e.e.e.e.e~esent~ and warmnte that it h~ not tlsed or ~i~e~ ~e p~ to ~ ~ed for ~eratin~
11. ~finE mgm ~n~r~. emineion or: or ~1 ~ ~ ~n~t to~c. or hu=.nrdou~ p011ntnnt~. :onlnmi~nt~_
d~n~_~ ~e F~ Co~mh~g ~v~o~enml Re~n~ Commn~fion ~nd l.inhili~ ~on of 1980 ("CERCL~,). or
14. ~e F~ R~e~ Cave.an ~d ~ove~ A~ of 1976 f'R~)_ or ~e Minne~m Env~onmen~
15. Li~ A~ Minn ~mt ~_ liSA (f~LA"~_ o~ ~v oth~ f~ ~t~ ar I~ ~v~o~en~l law~ common law:
17,
18.
lg.
20.
21.
22.
23.
24.
25.
27,
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
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(,Seller)
(,Sell~)
(Date) (Buymr) (Date)
(Da~e) (Buyer) (Date)
THIS IS A LEGALLY BINDING CONTRACT BETWEEN BUYERS AND SELLERS.
IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL.