Loading...
04-14-2020 HRA MIN SPECIAL of"'city �_ El .___. Special Virtual Meeting of the Elk River River Housing and Redevelopment Authority Held at the Elk River City Hall Tuesday, April 14, 2020 (Due to the COVID-19 Pandemic) Members Present: Chair Larry Toth,Commissioners Denny Chuba,Michelle Eder,Nate Ovall, and Jayme Swenson Members Absent: None Staff Present Economic Development Director Amanda Othoudt,Economic Development Specialist Colleen Eddy,and Sr.Administrative Assistant/Recording Secretary Jennifer Green I. Call Meeting to Order Pursuant to due call and notice thereof,the meeting of the FA River Housing and • Redevelopment Authority was called to order at 3:03 p.m.by Chair Toth and roll call was taken. 2. 406 Main Street Purchase Ms. Othoudt presented the staff report. She outlined details of the purchase agreement documents between the HRA and the property owner,Cora Smith,Trustee,Tim Smith,and the current tenant pertaining to the purchase of 406 Main St. NW,in the amount of $230,000 and a$5,000 escrow payment. She explained the property is currently occupied by tenant CRAG Enterprises LLC; therefore,negotiations required different rules and regulations for purchasing that fall under the Federal Property Relocation Act.The regulations allow CRAG Enterprises LLC,the sole tenant of the property,to remain on the premises until CRAG provides the HRA with notice of vacation. The sale closing date was set for June 30,2020,with the intent the tenants will then vacate the premises. $5000 in escrow funds will be held in an interest-bearing account which allows the HRA some flexibility with the tenant when they vacate the property,as the HRA can use the funds towards getting the property cleaned up as well as pay any overdue bills. Ms. Othoudt explained the tenants have signed a waiver of receiving relocation funds as outlined in the Property Relocation Act. • Commissioner Ovall asked for clarification of the signing of a waiver of relocation benefits within the purchase agreement and wondered if the HRA has any recourse if the tenants Housing and Redevelopment Minutes Page 2 April 14,2020 don't vacate. He questioned if the HRA has the authority to re-enter the property after closing. Ms. Othoudt stated she had detailed discussions with HRA attorneys to work through this agreement. She stated the tenants are waiving their relocation rights but the HRA is still required under the Federal Relocation Act to pay the tenants if the HRA forces relocation from the property. Chair Toth asked when they would be exiting the property. Ms. Othoudt stated they have briefly discussed this with the tenant,noting the HRA has to allow them to stay on the premises to comply with the Federal Relocation Act. Commissioner Eder asked if the HRA can collect rent during the month they are occupying the property under the Federal Relocation Act after purchasing the property. Ms. Othoudt stated the HRA can collect the same amount of rent from the tenant provided the tenant remains on the premises. However,the agreement that they are acting on today allows them to remain on the property until they were able to relocate. She stated the HRA will allow them to stay on the premises as long as they want to. Chair Toth asked if the tenants had a lease with the property owners. Ms. Othoudt stated there were no leases or rental agreements on the property. 1111 Chair Toth asked then what recourse does the HRA have if the tenants want to remain on the property indefinitely. Ms. Othoudt stated if the HRA decides they want to occupy the property before the tenant vacates the property,we would then be obligated to pay relocation fees. She is requesting giving the tenants a 30-day notice but they cannot force them out of their property. Commissioner Ovall wanted to ensure the HRA had a mechanism to engage in if we needed the tenants to vacate the property sooner,and in doing they can enter in relocation agreement at that time. Commissioner Eder asked if the tenants were still occupying the property on July 1 could the HRA collect monthly rent. Commissioner Ovall stated that stipulation would need to be in the agreement up front. Ms. Othoudt stated the current deal is the tenant can stay in the property without paying rent. Commissioner Eder asked if this property was going to have its house and garage moved. Housing and Redevelopment Minutes Page 3 April 14,2020 1111 Ms. Othoudt indicated a house mover is interested in purchasing this house and garage for $5,000 and will want to move it once the HRA is in possession of it and the tenants have vacated the property. She stated this will save the HRA on demolition costs. Commissioner Swenson asked if there was a connection between the property owner and the tenant. Ms. Othoudt stated the owner of the trust is the mother of CRAG Enterprises,a family owned business. Moved by Commissioner Eder and seconded by Commissioner Chuba to adopt Resolution 20-03 authorizing the execution of a purchase agreement for 406 Main Street,Elk River,MN,as outlined in the staff report. Motion carried 5-0. 3. Adjournment Chair Toth adjourned the meeting at 3:24 p.m. Minute prepared by Jennifer Green. • Tina Allard,City Clerk T ,Chair Housing&Redevelopment Authority •