Special HRA Meeting Packet 08-20-2024
Housing and Redevelopment
Authority
Special Meeting
Agenda
Tuesday, August 20, 2024
2:30 PM
Elk River City Hall
▪ Special meeting in Council Chambers
1. CALL MEETING TO ORDER
2. PLEDGE OF ALLEGIANCE
3. AMEND MAIN AND GATES PROPERTY PURCHASE AGREEMENT
3.1 Amend Main and Gates Property Purchase Agreement
4. MOTION TO ADJOURN MEETING
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The Elk River Vision
A welcoming community with revolutionary and spirited resourcefulness, exceptional service, and community
engagement that encourages and inspires prosperity
Request for Action
To
Housing and Redevelopment Authority
Item Number
3.1
Meeting Date
August 20, 2024
Prepared By
Brent O'Neil, Economic Development Director
Item Description
Consider Amendment Four to Main and Gates
Purchase Agreement
Reviewed by
Brent O'Neil
Cal Portner
Action Requested
Approve, by motion, Amendment Four to the Purchase Agreement for the sale of the Main and Gates
Property.
Background/Discussion
As discussed at the most recent HRA meeting, Ron Touchette, the buyer of the Main and Gates properties,
has requested additional changes to the purchase agreement on the property by submitting a draft a fourth
amendment to the agreement. These requests are summarized as follows:
▪ A seller credit of $53,939.00 to repair and restore non-compacted soils and buried debris associated
with demolition and fill of former structures on the properties.
▪ Certifications and warranties against utility disconnects or restorations associated with previous
structures.
▪ Warranties regarding buyer responsibility to maintain the existing water service to 425 3rd St. NW.
▪ Buyer's right to extend due diligence through building permit approval.
▪ Clarification of buyer and seller requirements regarding a supplemental development agreement.
▪ Adding a provision allowing the buyer 90 days to cure failures and defaults under the right of re-entry
(reverter) clause.
Following review with legal counsel, staff can support many of these requests, subject to modifications
proposed by counsel. Further, staff has been doing its own diligence and believes issues of previous utility
disconnects and restorations have been sufficiently performed during demolition. Regarding compacted soils,
it is staff's understanding from past meetings with the HRA that the HRA is not inclined to support a seller
credit. Therefore, it is not included in the final draft Amendment Four. However, it remains an active request
of the buyer and will be presented at the meeting.
Financial Impact
None anticipated, however, some of the warranties have potential costs in the event a warranty action
occurs, with a maximum exposure estimated at $25,000. Further, should the HRA support a credit to the
buyer, the net proceeds to the HRA at sale will be reduced accordingly.
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Special Meeting Notice
Housing and Redevelopment Authority (HRA)
Tuesday, August 20, 2024
2:30 p.m.
Elk River City Hall
13065 Orono Parkway
Elk River, Minnesota
The purpose of the meeting is as follows:
Consider an Amendment to the Purchase Agreement between the HRA and Ron Touchette,
dated June 21, 2023, for the Sale of Property at Main St. and Gates Ave, which the developer
requests soil correction concessions and utility warranties.
4�using and R ent Authority Chain Date
I HEREBY CERTIFY, that this notice has been posted and that I have served this notice upon the
members of the Housing and Redevelopment Authority by mail at least one day prior to the above -
called special meeting. In accordance with State Statute, this notice will be posted at least three days
prior to the meeting date.
Jolene Richter, Deputy City Clerk Date
INATUREI
Mission/Policy/Goal
A goal of the HRA is to promote redevelopment projects.
Attachments
1. Proposed Amendment Four
2. Touchette Proposed Amendment Four as Attorney Redlined
3. GeoTech Report Excerpt 07-09-2021
4. Soil Correction Proposal
5. Executed PA and Amendments 1-3
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FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT
This Fourth Amendment to Purchase and Sale Agreement (this “Fourth Amendment”) is made
this _____ day of August, 2024 by and between the Elk River Housing and Redevelopment Authority,
a Minnesota body corporate and politic (the “HRA”) and Ronald J. Touchette, a married person (the
“Buyer”).
WHEREAS, the HRA and the Buyer entered into that certain Purchase and Sale Agreement dated
June 21, 2023, as amended by that certain First Amendment to Purchase and Sale Agreement dated
March 14, 2024, as further amended by that certain Second Amendment to Purchase and Sale
Agreement dated May 29, 2024, and as further amended by that certain Third Amendment to Purchase
and Sale Agreement dated July 5, 2024 (as amended, the “Agreement”) providing for the conveyance
by the HRA to the Buyer of certain property located in the City of Elk River, Sherburne County,
Minnesota and legally described on the attached Exhibit A (the “Property”); and
WHEREAS, the HRA and the Buyer desire to further amend the Agreement on the terms and
conditions set forth herein.
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:
1. Amendment to Paragraph 4.3 of the Agreement. The following paragraphs will be added to
Paragraph 4.3 of the Agreement to read as follows:
4.3.5 The HRA warrants that all necessary or required water and sanitary sewer utility
disconnections to the Property have been made and any restorations associated
with the same have been completed.
Additionally, the HRA specifically represents and warrants that with respect to
the HRA, the Buyer shall have no responsibility to maintain, protect or provide
for the continuation of the use of any portion on, over or under the Property by
any private water connections to other properties that are not part of the
Property to be conveyed, that are not contained within the current utility
easements as shown on the Survey attached herein as Exhibit 4A. This
representation and warranty by the HRA shall survive Closing.
2. Amendment to Paragraph 5.1.4 of the Agreement. Paragraph 5.1.4 of the Agreement is
amended to read as follows:
5.1.4 Development Agreement. The HRA agrees that the Buyer shall not be required
or obligated to obtain or negotiate any development agreements with the HRA
in order to obtain or as part of the requirements to obtain a building permit for
the Buyer’s Medical on Main building project.
3. Amendment to Paragraph 6.1.1 of the Agreement. Paragraph 6.1.1 of the Agreement is
amended to read as follows:
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6.1.1 Deed. A quit claim deed conveying the Property to the Buyer. Said quit claim
deed shall contain a covenant running with the Property that construction of the
footings and foundations for the building on the Property must be completed
within one year from the date of the deed or the Property will be conveyed back
to the HRA by the Buyer. If such failure is not cured within 90 days upon
receipt of written notice from the HRA, unless such failure or delay is caused
by or results from acts beyond the Buyer’s reasonable control, including the
following: fire, flood, earthquake or explosion; war, invasion, hostilities,
terrorist threats or acts, riot, or other civil unrest; government order or law;
strikes, labor stoppages or slowdowns; or epidemic, pandemic. The building on
the Property must be an office building that is at least 6,000 square feet. Upon
the timely commencement of construction, the HRA agrees to execute and
deliver to Buyer a recordable form of the satisfaction of such covenant and
waiver of any right of the HRA to purchase the Property, which may be recorded
by Buyer at Buyer’s expense in the public records for Sherburne County,
Minnesota.
4. Miscellaneous. Except as amended by this Amendment, the Agreement shall remain in full
force and effect.
IN WITNESS WHEREOF, the parties have executed this Fourth Amendment to Purchase and
Sale Agreement as of the date written above.
SELLER: BUYER:
ELK RIVER HOUSING AND RONALD J. TOUCHETTE,
REDEVELOPMENT AUTHORITY,
Denny Chuba, President Ronald J. Touchette
Brent O’Neil, Executive Director
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EXHIBIT A
Legal Description of the Property
Parcels:
Lot 1, Block 1, Auditors Subdivision No 5, according to the recorded plat thereof,
Sherburne County, Minnesota.
PID 75-401-0105
AND;
Lot 3 & Lot 4 except the East 15 feet, Block 1, Auditors Subdivision No 5, according to
the recorded plat thereof, Sherburne County, Minnesota.
PID 75-401-0115
AND;
Lot 7, Block 1, Auditors Subdivision No 5, according to the recorded plat thereof,
Sherburne County, Minnesota.
PID 75-401-0130
AND;
Lot 8, Block 1, Auditors Subdivision No 5, according to the recorded plat thereof,
Sherburne County, Minnesota.
PID 75-401-0135
AND;
Lot 9, Block 1, Auditors Subdivision No 5, according to the recorded plat thereof,
Sherburne County, Minnesota.
PID 75-401-0140
AND;
Lot 10, Block 1, Auditors Subdivision No 5, according to the recorded plat thereof,
Sherburne County, Minnesota.
PID 75-401-0145
AND;
LOT 11 & that part of Lot 12 lying West of the East 4.50 feet of Lot 12, Block 1,
Auditors Subdivision No 5, according to the recorded plat thereof, Sherburne County,
Minnesota.
PID 75-401-0150
* All legal descriptions are subject to verification by a survey.
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EXHIBIT 4A
Existing Conditions Survey dated May 16, 2024
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FORTHFOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT
This ForthFourth Amendment to Purchase and Sale Agreement (this “Fourth Amendment”)is
made this 5th_____ day of August,2024 by and between the Elk River Housing and Redevelopment
Authority,a Minnesota body corporate and politic (the “HRA”)and Ronald J.Touchette,a married
person subsequently assigned to Medical on Main LLC, (as assigned, (the “Buyer”).
WHEREAS,the HRA and the Buyer entered into that certain Purchase and Sale Agreement
dated June 21st, 2023, as amended by that certain First Amendment to Purchase and Sale Agreement
dated March 14, 2024, as further amended by that certain Second Amendment to Purchase and Sale
Agreement dated May 29th, 2024, and as further amended by that certain Third Amendment to
Purchase and Sale Agreement dated July 5th, 2024 (as amended, the “Agreement”) providing for the
conveyance by the HRA to the Buyer of certain property located in the City of Elk River, Sherburne
County, Minnesota and legally described on the attached Exhibit A (the “Property”); and
WHEREAS, the HRA and the Buyer desire to further amend the Agreement on the terms
and conditions set forth herein.
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:
1.Amendment to Paragraph 4.3 of the Agreement. The following paragraphs will be added to
Paragraph 4.3 of the Agreement to read as follows:
4.3.4 The HRA shall provide to Buyer a credit upon Closing for the soil correction
needs and requirements of the property as identified by the AET soils report in
the amount of fifty-three thousand nine hundred thirty-nine dollars ($53,939.00)
for the Buyer to repair and restore the uncompacted soils and buried debris as
described in the AET Geo Tech Report dated 7-9-2021. The Buyer agrees to
accept such soils and conditions of the properties upon the receipt of such credit
at Closing and the HRA shall have no further obligation or responsibility
regarding such soils and debris thereinafter. This agreement as detailed herein
shall survive Closing.
4.3.5 The HRA shall certify, agree and warrant, at the sole expense of the
HRA,warrants that all necessary or required water and sanitary sewer utility
disconnectsdisconnections to the Property have been made and any utility
restorations associated with the same have been completed and that the Buyer
shall have no obligation regarding the old utility connections or any
circumstance or situation arising from same in perpetuity.
Additionally, the HRA specifically represents and warrantieswarrants that
with respect to the HRA, the Buyer shall have no responsibility to maintain,
protect or provide for the continuation of the use of any portion on, over or
under the Property by any utility services or connections, includingprivate
water connections to other properties that are not part of the Property to be
conveyed, that are not contained within the current utility easements as shown
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on the Survey attached herein as Exhibit 4A.These representationsThis
representation and warrantieswarranty by the Seller and the HRA shall survive
Closing.
2.Amendment to Paragraph 5.1.2 of the Agreement. Paragraph 5.1.2 of the Agreement is
amended to read as follows:
5.1.2 Land Use Approvals. The Buyer shall have obtained, at the Buyer's sole cost and
expense, before the Contingency Date, all consents, agreements, approvals,
easements, licenses and adequate assurances that are legally necessary for the
Buyer to use the Property for its intended use or purpose, including, but not
limited to, land use and building permit approvals from the City of Elk River.
Buyer agrees to submit, providing for the requisite fees associated or required
with such submittal, for review and approval by the City of Elk River Buyers
building permit application for the land use and construction of the site work
and building shell components on or before August 12, 2024, (“Building
Permit”). Buyer’s Contingency Date shall be automatically extended to such
date as Buyer receives approval for the Building Permit and is in receipt of such
permit authorizing Buyer to begin construction.
2.3. Amendment to Paragraph 5.1.4 of the Agreement. Paragraph 5.1.4 of the Agreement is
amended to read as follows:
5.1.4 Development Agreement. The HRA shall affirmatively warrantagrees that the
Buyer shall not be required or obligated to obtain or negotiate any
development agreements with the HRA in order to gainobtain or as part of the
requirements to gainobtain a building permit for the BuyersBuyer’s Medical
on Main building project, effective as of the date Buyer submits for Buyer’s
Building Permits, as hereinafter defined and not later than the Contingency
Date, or agrees to extend such contingency date until such time as such an
affirmation, reasonable acceptable to Buyer, can be provided or is received by
Buyer.
3.4. Amendment to Paragraph 6.1.1 of the Agreement. Paragraph 6.1.1 of the Agreement is
amended to read as follows:
6.1.1 Deed. A quit claim deed conveying the Property to the Buyer. Said quit claim
deed shall contain a covenant running with the Property that construction of
the footings and foundations for the building on the Property must have
commencedbe completed within one year from the date of the deed or the
Property will be conveyed back to the HRA by the Buyer upon the HRA’s
return of the Purchase Price to Buyer, if. If such failure is not cured within
ninety (90) days upon receipt of written notice from the HRA, unless Buyer
shall be unintentionally or uncontrollably delayed, hindered or prevented from
commencing construction within one year from the date of the deed by reason
of labor difficulties, inability to procure materials, restrictive governmental
laws or regulations, insurrection, war, terrorists acts, acts of God,
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governmental delay, adverse weather conditions, terrorism, or other reason of
like nature not the fault of the Buyersuch failure or delay is caused by or
results from acts beyond the Buyer’s reasonable control, including the
following: fire, flood, earthquake or explosion; war, invasion, hostilities,
terrorist threats or acts, riot, or other civil unrest; government order or law;
strikes, labor stoppages or slowdowns; or epidemic, pandemic. The building
on the Property must be an office building that is at least 6,000 square feet.
Upon the timely commencement of construction, the HRA agrees to execute
and deliver to Buyer a recordable form of the satisfaction of such covenant
and waiver of any right of the HRA to purchase the Property, which may be
recorded by Buyer at Buyer’s expense in the public records for Sherburne
County, Minnesota.
4.5. Miscellaneous. Except as amended by this Amendment, the Agreement shall remain in full
force and effect.
IN WITNESS WHEREOF, the parties have executed this ForthFourth Amendment to
Purchase and Sale Agreement as of the date written above.
SELLER:BUYER:
ELK RIVER HOUSING AND RONALD J. TOUCHETTE,
REDEVELOPMENT AUTHORITY,
Denny Chuba, President Ronald J. Touchette
Brent O’Neil, Executive Director
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EXHIBIT A
Legal Description of the Property
Parcels:
Lot 1, Block 1, Auditors Subdivision No 5, according to the recorded plat thereof,
Sherburne County, Minnesota.
PID 75-401-0105
AND;
Lot 3 & Lot 4 except the East 15 feet, Block 1, Auditors Subdivision No 5, according to
the recorded plat thereof, Sherburne County, Minnesota.
PID 75-401-0115
AND;
Lot 7, Block 1, Auditors Subdivision No 5, according to the recorded plat thereof,
Sherburne County, Minnesota.
PID 75-401-0130
AND;
Lot 8, Block 1, Auditors Subdivision No 5, according to the recorded plat thereof,
Sherburne County, Minnesota.
PID 75-401-0135
AND;
Lot 9, Block 1, Auditors Subdivision No 5, according to the recorded plat thereof,
Sherburne County, Minnesota.
PID 75-401-0140
AND;
Lot 10, Block 1, Auditors Subdivision No 5, according to the recorded plat thereof,
Sherburne County, Minnesota.
PID 75-401-0145
AND;
LOT 11 & that part of Lot 12 lying West of the East 4.50 feet of Lot 12, Block 1,
Auditors Subdivision No 5, according to the recorded plat thereof, Sherburne County,
Minnesota.
PID 75-401-0150
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* All legal descriptions are subject to verification by a survey.
EXHIBIT 4A
Existing Conditions Survey dated May 16, 2024
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Standard Form Proposal & Agreement
July 29th, 2024
Ron Touchette
7078 East Fish Lake Road
Maple Grove, MN 55311
612-685-0373
Attn: Ron
ron@rocksolidcos.com
Re: Proposal: Soil Correction for Medical on Main Site - Elk River
One-Call Contracting Inc. will provide Labor, Material, and Equipment to complete the following work:
ITEMS
Site Soil Correction
Mobilize equipment to site.
Soil correction for this Medical On Main building foundation, with oversize, will be 2,192 CY to go down to 7'
depth.
Provide, Import & Install 1644 tons of select granular sand.
Grade & Compact the entire parking lot a minimum 3' below grade to 98%-100% density.
This scope of work may change due to soil engineer’s recommendations.
Total..............................................................................................................................................................$53,939.00
Notes - This proposal needs to become a rider to any and all contracts.
NOT INCLUDED UNLESS NOTED
1) De-Watering 6) Staking / Surveying
2) Any Hazardous Materials/ Buried Debris 7) Testing
3) Soil Corrections 8) Erosion Control
4) Winter Conditions 9) Maintaining Erosion Control
5) Shoring 10) No Restoration, Sod, Landscape
11) Freeze Protection / Frost Blankets
_____________________________ __________
Signature Date
Shawn Mitchell
Cell 612-221-8598
shawn@onecallcontracting.net
Project Manager - Estimator
3139 162nd Lane NW, Andover, MN 55304 l Phone: 763-780-9197 l Fax: 763-717-4607
Proud To Be Woman Owned, Section 3 and SBE Certified
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