5.0. HRSR 11-22-1993 ELK RIVER HOUSING AND REDEVELOPMENT AUTHORITY
0
TO: HOUSING AND REDEVELOPMENT AUTHORITY
FROM: WILLIAM RUBIN, ECONOMIC DEVELOPMENT COORDINATO 1/I
DATE: NOVEMBER 17, 1993 /
SUBJECT: AGENDA MEMO FOR NOVEMBER 22, 1993, HRA MEETING
5 . CHUBA DEVELOPMENT AGREEMENT
At the HRA's September 7th meeting, Commissioners approved
a request from the Elk River City Council to fund 50% of
the demolition and site preparation costs, up to a maximum
cost of $25,000, associated with the Main Street and
Freeport Avenue office-townhouse project.
It is now in order to execute an agreement with the
project' s developer, The Chuba Company. This agreement
will also be signed by the City of Elk River, The Chuba
Company, and Mr. Dennis Chuba, who is guaranteeing the
performance of his company. The Development Agreement
outlines the terms and conditions by which The Chuba
Company will, be reimbursed for the demolition and site
• preparation costs associated with this redevelopment
project.
Action Requested
The Elk River HRA is asked to approve the Development
Agreement with The Chuba Company.
6 . Statement of Expenses (Parking Lot Improvements)
Finance Director Lori Johnson has outlined the Statement
of Expenses associated with the Jackson Square and former
railroad property parking lot improvements
Action Requested
The Elk River HRA is asked to approve the Statement of
Expenses for the parking lot improvements in the amount of
$32,049 .28 .
•
P.O. Box 490 • 13065 Orono Parkway • Elk River, MN 55330-1743 • (612) 441-7420 • Fax: (612) 441-7425
Equal Opportunity Housing and Equal Opportunity Employment
DEVELOPMENT AGREEMENT
THIS DEVELOPMENT AGREEMENT entered into this day of
November, 1993, by and between the City of Elk River, Minnesota
(City) , the Elk River Housing and Redevelopment Authority
(HRA) , The Chuba Company (Developer) , and Dennis Chuba (Chuba) .
WHEREAS, Developer and Chuba propose to construct an 8,900
gross square foot office condominium building (the Project) on
property (the Development Property) legally described as
follows :
Lots 1, 2, and 3, Block 21, Village of Elk River,
Sherburne County, Minnesota. (PID No. 75-405-2110 and PID
No. 75-405-2120); and,
WHEREAS, Developer has represented to the City that the
Project will have a minimum market value for tax valuation
purposes of $565,000; and,
WHEREAS, Developer has requested assistance from the City
with demolition of the existing structures on the Development
Property and site preparation of the Development Property for
the Project; and,
WHEREAS, the City Council of the City of Elk River has
• determined that redevelopment of the Development Property and
construction of the Project is consistent with the City' s
Growth Management Plan and Zoning Ordinance; and,
WHEREAS, the City Council of the City of Elk River has
determined that the Project is consistent with the purposes of
the City of Elk River Development District No. 1 and Tax
Increment Financing District No. 1 and No. 3; and,
WHEREAS, the City Council of the City of Elk River has
amended the Tax Increment Financing Plans for TIF District No.
1 and No. 3 to provide assistance to the Project; and,
WHEREAS, the City Council of the City of Elk River has
approved Tax Increment Financing assistance to the Project for
demolition and site preparation, in an amount not to exceed
$50,000, subject to the execution of this Development
Agreement; and,
WHEREAS, the Elk River HRA resolved to fund fifty percent
(50%) of the demolition and site preparation cost, up to a
maximum of $25,000 .
•
• NOW, THEREFORE, the parties hereto agree as follows :
1 . Developer Obligations .
Developer covenants and agrees as follows :
- to acquire fee title to the Development Property;
- to demolish and clear existing structures from
the Development Property;
- To develop and construct an 8, 900 gross square
foot or larger office condominium building with a
minimum market value of $565,000; and
- to complete construction of the Project and
obtain a Certificate of Occupancy for the office
condominium building no later than January 1,
1995.
2 . City Obligations .
City covenants and agrees to reimburse the Developer
for:
- the actual cost of demolition and removal of the
• existing structures on the Development Property;
and
- the actual cost of site preparation of the
Development Property for construction of the
Project.
3 . Chuba Obligations .
The obligation of Chuba under this Development
Agreement shall be as guarantor of the performance of
Developer. If Developer fails to perform pursuant to
the terms of this Development Agreement, Chuba agrees
that the City may pursue either Developer or Chuba
individually, or both, to recover any sums due the
City pursuant to this Development Agreement.
4 . Reimbursement Procedure.
Developer will be reimbursed for its actual costs of
demolition and site preparation, upon satisfaction of
the following conditions :
- Developer must complete demolition of the
existing structures on the Development Property
• and complete site preparation of the Development
Property for the Project;
- Developer must submit to the City evidence
satisfactory to the City, in the City' s sole
discretion, of the actual cost for said
demolition and site preparation;
- The City Council of the City of Elk River must
approve payment pursuant to the terms of this
Development Agreement.
5. Default.
Developer shall be in default under the terms of this
agreement if:
- Developer seeks reimbursement for any costs not
authorized by this agreement; or
- Developer seeks reimbursement for any costs in
excess of Developer' s actual costs for demolition
and site preparation; or
- Developer fails to obtain a Certificate of
Occupancy for the Project on or before January 1,
1995; or
- the market value of the Project for tax valuation
purposes, as of January 1, 1995, is less than
$565,000.
6 . Remedies on Default.
If Developer is in default under the terms of this
agreement, the City may exercise one or more of the
following remedies :
- the City may terminate this Development Agreement;
- the City may refuse to make payment to or
reimburse Developer for demolition and site
preparation costs provided for in this agreement;
- the City may, if payment has already been made to
Developer, bring an action against Developer
and/or Chuba for recovery and repayment of all
sums paid to Developer, and for City's reasonable
attorney's feet and such other expenses incurred
by the City in seeking to recover payments made
to Developer;
- the City may exercise any other remedies which it
• may have at law.
IN WITNESS WHEREOF, the City, Developer, and Chuba have
• caused this agreement to be executed by their duly authorized
representatives.
CITY OF ELK RIVER
By:
John J. Dietz
Its : Vice Mayor
By:
Patrick D. Klaers
Its : City Administrator
ELK RIVER HRA
By:
Richard Hinkle
Its : Chairman
THE CHUBA COMPANY
•
By:
Dennis Chuba
Its :
DENNIS CHUBA
STATE OF MINNESOTA
ss .
COUNTY OF SHERBURNE
The foregoing instrument was acknowledged before me this
day of November, 1993, by John J. Dietz, the Vice Mayor
of the City of Elk River, on behalf of the City of Elk River.
Notary Public
•
STATE OF MINNESOTA
ss.
COUNTY OF SHERBURNE
The foregoing instrument was acknowledged before me this
day of November, 1993, by Patrick D. Klaers, the City
Administrator of the City of Elk River, on behalf of the City
of Elk River.
Notary Public
STATE OF MINNESOTA
ss .
COUNTY OF SHERBURNE
The foregoing instrument was acknowledged before me this
day of November, 1993, by Richard Hinkle, the Chairman of
the Elk River Housing and Redevelopment Authority, on behalf of
• the Elk River Housing and Redevelopment Authority.
Notary Public
STATE OF MINNESOTA
ss .
COUNTY OF SHERBURNE
The foregoing instrument was acknowledged before me this
day of November, 1993, by , the
of THE CHUBA COMPANY, a Minnesota Corporation,
on behalf of the corporation.
Notary Public
•
STATE OF MINNESOTA
ss .
COUNTY OF SHERBURNE
The foregoing instrument was acknowledged before me this
day of November, 1993, by Dennis Chuba.
Notary Public
.
• JACKSON SQUARE & RAILROAD PARKING LOT
PROJECT SUMMARY
Vendor Description Amount
Eull Concrete Products Blocks 126.52
Ess Brothers & Sons Concrete 458.48
MSA Lot Layout 413.26
Broadway Rental Equip. Rental 99.05
Davies Water Equipment Irrigation System 204.55
Coast to Coast Misc. 19.57
The Hardware Store Pipe 27.78
Elk River Bituminous AC 9,21 1.50
Irrigation Supply Pipe 100.02
Model Landscaping Sod 748.44
Sunderman Paints Misc. 25.35
WaterPro Storm Sewer 776.17
Barton Sand & Gravel Concrete 601.60
Cretex Storm Sewer 338.94
Custom Rock Red Brick Color & Design Tool 639.00
Plaisted Sand/Gravel 949.38
Brock White Sealer 107.12
AME Concrete 736.05
• A.N. Johnson Removal of Stumps & Blacktop 1,330.00
Schmidt Curb Company Curb & Gutter 7,936.50
Trees (to be planted) 1,100.00
Materials Total 25,949.28
Equipment Rent & Employee Time 6,100.00
PROJECT TOTAL 32,049.28
•
11/17/93 4:07 PM