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Home My WebLink About2023-06-26 EDA Meeting Packet-Special Meeting AGENDA MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY SPECIAL MEETING Monday, June 26, 2023 Immediately Following the Conclusion of the City Council Meeting City Hall, Council Chambers A. CALL TO ORDER B. ROLL CALL C. APPROVAL OF AGENDA D. APPROVAL OF MINUTES 1. May 08, 2023 Economic Development Authority Special Meeting Minutes E. PUBLIC HEARING None F. UNFINISHED BUSINESS None G. NEW BUSINESS 1. Tax Increment Financing District No. 1-17 a. Resolution Adopting a Tax Increment Financing Plan b. Contract for Private Development c. Resolution Authorizing Interfund Loan 2. Support of Affordable Housing Project, JB Vang – Gladstone Village II, 1880 English Street North a. Resolution Supporting Use of Tax Increment Financing b. Letter of Support from EDA President c. Acknowledgment of Receptivity of a Metropolitan Council LCA Funding Award 3. Cancellation of the July 10, 2023 EDA Meeting H. ADJOURNMENT RULES OF CIVILITY FOR THE CITY COUNCIL, BOARDS, COMMISSIONS AND OUR COMMUNITY Following are rules of civility the City of Maplewood expects of everyone appearing at the Meetings - elected officials, staff and citizens. It is hoped that by following these simple rules, everyone’s opinions can be heard and understood in a reasonable manner. We appreciate the fact that when appearing at Council meetings, it is understood that everyone will follow these principles: Speak only for yourself, not for other council members or citizens - unless specifically tasked by your colleagues to speak for the group or for citizens in the form of a petition. Show respect during comments and/or discussions, listen actively and do not interrupt or talk amongst each other. Be respectful of the process, keeping order and decorum. Do not be critical of council members, staff or others in public. Be respectful of each other’s time keeping remarks brief, to the point and non-repetitive. THIS PAGE IS INTENTIONALLY LEFT BLANK D1 MEETINGMINUTES MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY SPECIAL MEETING 6:00P.M. Monday, May 8, 2023 City Hall, Council Chambers A.CALL TO ORDER A special meeting of the Maplewood Economic Development Authority (EDA)was heldin the City Hall Council Chambers and was called to order at6:02 p.m. by President Abrams. B.ROLL CALL Marylee Abrams, PresidentPresent Rebecca Cave, CommissionerPresent Kathleen Juenemann, CommissionerPresent Chonburi Lee, CommissionerPresent Nikki Villavicencio,CommissionerPresent C.APPROVAL OF AGENDA CommissionerLeemoved to approve the agendaas submitted. Seconded by CommissionerJuenemannAyes – All The motion passed. D.APPROVAL OF MINUTES 1.April 10, 2023 Economic Development AuthorityMeeting Minutes CommissionerJuenemannmoved to approve the April 10, 2023 Economic Development AuthorityMeeting Minutes assubmitted. Seconded by CommissionerCave Ayes – All The motion passed. E.PUBLIC HEARING None F.UNFINISHED BUSINESS None. G.NEW BUSINESS 1.Term Sheet for Reuter Walton Redevelopment of 1136/1160 Frost Avenue East Assistant Executive Director Parr provided background information. Schane Rudlang, with Ehlers, gave the presentation. May 08, 2023 Maplewood Economic Development AuthoritySpecial Meeting Minutes 1 EDA Special Meeting Packet Page Number 1 of 103 D1 President Abramsmoved to approve the revised Term Sheet with Reuter Walton Development. Seconded by Commissioner JuenemannAyes – All The motion passed. 2.Call for a Special Meeting of the EDA on June 26, 2023 Regarding the Reuter Walton Project, 1136/1160 Frost Avenue East, and Other Potential Projects Assistant Executive Director Parrgave the staff report. CommissionerCavemoved to call a special meeting of the EDA on June 26, 2023 at 6:00pm in the City Hall Council Chambers for the purpose of reviewing Tax Increment Financing material related to the Reuter Walton redevelopment project and other projects as needed. Seconded by President Abrams Ayes – All The motion passed. H.ADJOURNMENT President Abramsadjourned the meeting at6:11p.m. May 08, 2023 Maplewood Economic Development AuthoritySpecial Meeting Minutes 2 EDA Special Meeting Packet Page Number 2 of 103 G1 MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY STAFF REPORT Meeting Date June 26, 2023 REPORT TO: Melinda Coleman, City Manager REPORT FROM: Danette Parr, Assistant Executive Director PRESENTER:Danette Parr, Assistant Executive Director AGENDA ITEM: Tax Increment Financing District No. 1-17 a.Resolution Adopting a Tax Increment Financing Plan b.Contract for Private Development c.Resolution Authorizing Interfund Loan Action Requested: Motion Discussion Public Hearing Form of Action: Resolution OrdinanceContract/Agreement Proclamation Policy Issue: The Economic Development Authority (EDA) has received a Tax Increment Financing (TIF) application from the developer of the property at 1136 Frost Avenue (former Maplewood Marine site) and 1160 Frost Avenue (city-owned vacant site). The application requests TIF assistance for the construction of a 150-unit multi-family building. Recommended Action: a.Motion to approve the resolution adopting a Tax Increment Financing Plan for Tax Increment Financing District No. 1-17. b.Motion to approve the Contract for Private Development with Reuter Walton Development. c.Motion to approve the resolution authorizing an Interfund Loan for Advance of Certain Costs in Connection with Tax Increment Financing District No. 1-17. Fiscal Impact: Is There a Fiscal Impact? No Yes, the true or estimated cost is $4,500,000 Financing source(s): Adopted Budget Budget Modification New Revenue Source Use of Reserves Other: Under the terms of the development agreement, the EDA would issue a tax increment revenue note to the developer in the amount of $4,500,000 to reimburse the property owner for site acquisition and site improvements associated with the construction of 150 market-rate housing units. The note would be paid from future tax increment generated by the private development over a maximum term of 14 years. Strategic Plan Relevance: Community InclusivenessFinancial & Asset MgmtEnvironmental Stewardship Integrated CommunicationOperational EffectivenessTargeted Redevelopment EDA Special Meeting Packet Page Number 3 of 103 G1 The city’s Gladstone Neighborhood Redevelopment Plan states: “Key components of the Master Plan include intense development at the core of the Frost Ave and English Streets and integrated land use patterns with 650 new housing units.” Background: Tax Increment Financing On July 22, 2019, the city adopted a modified enabling resolution for the Maplewood Economic Development Authority which grants the EDA authority to use tax increment financing. Tax increment financing is a funding tool that takes advantage of the increase in property taxes that result from redevelopment. The increase in tax revenue is a result of the investment in the property and the resulting increase in property taxes. TIF captures only the increase in taxes and not the current or base amount of taxes that are currently paid. The increment can be used by the EDA to repay debt, obligations, or certain costs incurred by the city as a result of the development. For this application, the City would issue a Pay-As-You-Go (PAYGO) TIF Note to the developer for costs associated with the redevelopment project. The PAYGO TIF Note would obligate the city to pay a portion of the annually generated tax increment over a specified period of time. The goal of the proposed TIF district is to support redevelopment of the site that would not occur “but for” the financial assistance from the EDA. Proposed Development The developer, Reuter Walton (also referred to as Frost Avenue Group, LLC), is proposing to demolish the former Maplewood Marine building at 1136 Frost Avenue which would be combined with the vacant property at 1160 Frost Avenue in order to redevelop the site into a market-rate apartment building. The building would be five stories of above-ground wood-framed construction; and a floor of underground parking. The entire building would be approximately 237,993 gross total square feet, with an approximately 39,044 square foot footprint. The 150-unit building includes the following approximate unit mix: 13 percent studios/alcoves, 33 percent one-bedrooms, 15 percent one-bedrooms with a den, 28 percent two-bedroom, and 11 percent three-bedrooms. Parking is programmed to be 1.62 stalls per unit, with at least one stall per unit within a secured parking garage. The proposed building will be constructed with contrasting light and dark cement lap siding and wood-look lap siding accent boards. A brick façade will be used on lower levels, and cementitious trim boards will be used throughout the building. Amenities will include a clubroom, fitness room, roof deck, outdoor pool, pickle ball court, and dog run. TIF District and TIF Plan The first resolution before the EDA would create a new redevelopment TIF district by adopting a tax increment financing plan. This plan outlines the district boundaries, objectives and policies, fiscal impacts, and the maximum budget for the district. The TIF plan itself does not grant any specific TIF assistance or city financial obligations to support development within the district. The specific terms of the TIF assistance are provided in the development agreement between the EDA and the developer. Term Sheet On May 8, 2023, the EDA considered and approved a revised term sheet with Reuter Walton to support the redevelopment project. The agreement includes the following terms: The developer will construct a 5-story building with approximately 150 units of market-rate rental housing and related amenities. The developer will acquire all of the redevelopment property by June 30, 2023. EDA Special Meeting Packet Page Number 4 of 103 G1 The developer will commence construction by December 31, 2023 and complete construction by December 31, 2025. The developer will pay a $54,684 park dedication fee to the city. The EDA will reimburse the developer through available tax increment for up to a total of $4,500,000 (present value) of qualified costs for the project. Qualified costs include acquisition, demolition, remediation, site improvement, and infrastructure costs. The EDA will make payments to the developer through a PAYGO TIF Note from the annually available tax increment over a maximum term of 14 years at a rate the lesser of 5.25% or the rate of the developer’s first mortgage lien. The public assistance is subject to a lookback upon completion of construction. If the total development costs actually incurred is less than the amount of the estimated total development costs, the present value of the public assistance will be reduced by 50% of the difference. Development Agreement City staff and our legal and financial advisors have negotiated the attached development agreement which outlines the final details of the financial assistance. The development agreement provides $4.5 million of present value of financial assistance to the developer. The proposed agreement includes the following additional terms: The EDA will issue a Pay-As-You-Go (PAYGO) Note in the principal amount of $4,500,000. The note will bear simple, non-compounding interest at the lesser of 5.25% or the rate of the developer’s first mortgage. The note is issued for reimbursement of qualifying costs, which include site acquisition, public infrastructure, site preparation and site improvements, not to exceed the amount of the note. The EDA would pledge the tax increment generated from the project for payment of the principal and any accrued interest. The EDA would only pay the developer from increment annually generated and nothing more. If the amount of increment annually generated is not enough to pay the PAYGO Note, the EDA is not obligated to pay the difference. The developer assumes the financial risk. The term of the note is a maximum of 14 years. The developer will pay a park fee in the amount of $54,684. The developer will commence construction by December 1, 2023 and complete construction by December 31, 2025. The developer will construct the building in accordance to the Green Building Code and divert 75% of the demolition materials from landfills. Interfund Loan Resolution It is also recommended that the EDA approves an interfund loan from the EDA’s general fund to pay any upfront costs of establishing and administering the TIF district and negotiating and drafting the development agreement not already paid by the developer. Should the EDA need to draw on the interfund loan, it will be paid back by the EDA’s retained share of the tax increments set aside to pay for administrative expenses. EDA Special Meeting Packet Page Number 5 of 103 G1 Attachments: 1.Resolution Adopting a Tax Increment Financing Plan 2.Contract for Private Development 3.Resolution Authorizing Interfund Loan 4.Modification to the Development Program and Tax Increment Financing Plan EDA Special Meeting Packet Page Number 6 of 103 G1, Attachment 1 MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY SOLUTION NO. __________ RE A RESOLUTION ADOPTING A MODIFICATION TO THE DEVELOPMENT DISTRICT PROGRAM FOR DEVELOPMENT DISTRICT NO. 1 AND THE TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 1- 17 BE IT RESOLVED by the Maplewood Economic Development Authority as follows: Section 1. Recitals. 1.01. The Maplewood Economic Development Authority (“MEDA”) has been established by the city of Maplewood (the “City”) to promote development and redevelopment within Maplewood. 1.02. Under the terms of the modified enabling resolution adopted by the City on July 22, 2019, MEDA has all the powers and authority of an economic development authority under Minnesota Statutes, sections 469.090 through 469.1081 (the “EDA Act”), of a housing and redevelopment authority under Minnesota Statutes, sections 469.001 through 469.047 (the “HRA Act”) and of a city under Minnesota Statutes, sections 469.124 through 469.134 (the “City Development Districts Act”). 1.03. MEDA’s goals include recognizing the practical impediments to development and redevelopment in areas of the community which are fully developed and offering public assistance when appropriate for projects which advance its goals. 1.04. In order to promote development and redevelopment of the community, the City previously established Development District No. 1 (the “Development District”) and adopted a Development District Program (the “Development Program”) for same. 1.05. In response to a redevelopment proposal regarding the propertiesat 1136 and 1160 Frost Avenue E and adjacent land on Phalen Place N, MEDA authorized the preparation of a tax increment financingplan (the “TIF Plan”) for Tax Increment Financing District No. 1-17 (the “TIF District”), which is contained in a document entitled “Modification to the Development Program for Development District No. 1 and Tax Increment Financing Plan for Tax Increment Financing District No. 1-17 (a redevelopment district)”, prepared by Ehlers and on file with MEDA. Section 2. Authority Approval. 2.01. Copies of the modified Development Program and the TIF Plan were transmitted to the board of Independent School District No. 622 and the board of commissioners of Ramsey County for review and comment and said public bodies were notified of the public hearing to be held on the modified Development Program and TIF Plan by the City on June 26, 2023. MA745-36-852047.v3 1 EDA Special Meeting Packet Page Number 7 of 103 G1, Attachment 1 2.02. MEDA finds that its objectives of encouraging development and redevelopment within the designated area of Maplewood will be advanced by adoption of the modified Development Program and the TIF Plan. 2.03. MEDA also finds that the modified Development Program and the TIF Plan are consistent with the City’s comprehensive plan. 2.04. The modified Development Program and the TIF Plan are hereby adopted. Section 3. Further Proceedings. 3.01. MEDA requests that the City hold a public hearing on the modified Development Program and the TIF Plan pursuant to Minnesota Statutes, section 469.175 and recommends that the modified Development Program and TIF Plan be approved by the City. 3.02. Upon approval of the modified Development Program and the TIF Plan by the City, MEDA’s executive director is authorized and directed to instruct Ehlers to request that the original tax capacity of the property within TIF District No. 1-17 be certified to MEDA by Ramsey County. Dated: June 26, 2023 ______________________________ Marylee Abrams, President ATTEST: _____________________________ Melinda Coleman, Executive Director MA745-36-852047.v3 2 EDA Special Meeting Packet Page Number 8 of 103 G1, Attachment 2 DRAFT May 19, 2023 CONTRACT FOR PRIVATE REDEVELOPMENT By and Between THE MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY and FROST AVENUE GROUP, LLC This document drafted by: KENNEDY & GRAVEN, CHARTERED (RHB) 150 South Fifth Street Suite 700 Minneapolis, MN 55402 (612)337-9300 EDA Special Meeting Packet Page Number 9 of 103 G1, Attachment 2 TABLE OF CONTENTS PAGE PREAMBLE ....................................................................................................................................1 ARTICLE I Definitions Section 1.1. Definitions................................................................................................................2 Section 1.2. Exhibits ...................................................................................................................4 Section 1.3. Rules of Interpretation ............................................................................................5 ARTICLE II Representations and Warranties Section 2.1. Representations by MEDA ......................................................................................5 Section 2.2. Representations and Warranties by the Redeveloper ...............................................6 ARTICLE III Redevelopment Assistance Section 3.1. Issuance of Pay-As-You-Go Note ...........................................................................6 Section 3.2. Conditions Precedent to Issuance of Note ...............................................................7 Section 3.3. Records ....................................................................................................................7 Section 3.4. Terms, Execution and Delivery of Note ..................................................................7 Section 3.5 Preparation and Delivery .........................................................................................9 Section 3.6 Security Provisions ..................................................................................................9 Section 3.7 Lookback Provisions and Reduction of Note ..........................................................9 ARTICLE IV Construction of Minimum Improvements, Infrastructure Improvements and Site Improvements Section 4.1. Construction of Minimum Improvements ...............................................................9 Section 4.2. Commencement and Completion of Construction .................................................10 Section 4.3. Certificate of Completion ......................................................................................10 Section 4.4. Reconstruction of Minimum Improvements ..........................................................10 ARTICLE V Business Subsidy; Park Dedication Section 5.1. No Business Subsidy..............................................................................................10 Section 5.2. Park Dedication Fee ...............................................................................................10 ARTICLE VI Payment of Taxes; Use of Tax Increment Section 6.1. Taxes ......................................................................................................................11 Section 6.2. Right to Collect Delinquent Taxes .........................................................................11 Section 6.3. Reduction of Taxes ................................................................................................11 EDA Special Meeting Packet Page Number 10 of 103 G1, Attachment 2 Section 6.4. Use of Tax Increment.............................................................................................11 ARTICLE VII Restrictions on Sale of Minimum Improvements Section 7.1. Prohibition Against Sale of Minimum Improvements ...........................................12 ARTICLE VIII Events of Default Section 8.1. Events of Default Defined .....................................................................................12 Section 8.2. Remedies on Default ..............................................................................................13 Section 8.3. No Remedy Exclusive............................................................................................13 Section 8.4. No Additional Waiver Implied by One Waiver .....................................................13 ARTICLE IX Additional Provisions Section 9.1. Conflict of Interests; Representatives Not Individually Liable .............................14 Section 9.2. Restriction of Use .................................................................................................14 Section 9.3. Notices and Demands ............................................................................................14 Section 9.4. Counterparts ...........................................................................................................14 Section 9.5. Disclaimer of Relationships ...................................................................................15 Section 9.6. Amendment; Assignment.......................................................................................15 Section 9.7. Recording ...............................................................................................................15 Section 9.8. Release and Indemnification Covenants ................................................................15 Section 9.9. Titles of Articles and Sections ...............................................................................15 Section 9.10. Governing Law; Venue ..........................................................................................15 Section 9.11. Agreement Runs with the Land .............................................................................15 Section 9.12. Fees and Charges ...................................................................................................16 TESTIMONIUM............................................................................................................................17 SIGNATURES ......................................................................................................................... 17-18 EXHIBIT A LEGAL DESCRIPTION OF THE REDEVELOPMENT PROPERTY EXHIBIT BDEPICTION OF THE REDEVELOPMENT PROPERTY AND MINIMUM IMPROVEMENTS EXHIBIT C FORM OF CERTIFICATE OF COMPLETION EXHIBIT D FORM OF NOTE EXHIBIT E FORM OF INVESTMENT LETTER EXHIBIT F ESTIMATED TOTAL REDEVELOPMENT COSTS EXHIBIT GLIST OF QUALIFIED COSTS EDA Special Meeting Packet Page Number 11 of 103 G1, Attachment 2 CONTRACT FOR PRIVATE REDEVELOPMENT This Contract for Private Redevelopment (the “Agreement”) is made this _____ day of ___________, 2023, by and between the Maplewood Economic Development Authority, a public body corporate and politic under the laws of Minnesota, having its principal office at 1830 County Road B E, Maplewood, Minnesota 55109-2702 (“Maplewood Economic Development Authority” or “MEDA”), and Frost Avenue Group, LLC, a Delaware limited liability company having its principal office at 4450 Excelsior Boulevard, Suite 400, St. Louis Park, Minnesota 55416, (the “Redeveloper”). WITNESSETH: WHEREAS, MEDA finds there to exist within residential areas of the community properties that have a blighting influence on surrounding properties and are structurally substandard due to their poor physical condition or functional obsolescence and others with remnants of previous developments which have not been completely removed and which, because of those conditions, threaten the health, safety and welfare of the community; and WHEREAS, MEDA finds that it is in the public interest, helpful for the tax base and beneficial for the health, safety and welfare of the community as a whole to remove structurally substandard buildings and to redevelop those properties and adjacent parcels in ways which will expand the housing options available in the community; and WHEREAS, MEDAfinds that, due to market conditions which exist today and are likely to persist for the foreseeable future, the private sector alone is at times not able to accomplish redevelopment of the type needed and, therefore, such will not occur without public intervention; and WHEREAS, in order to foster the type of redevelopment described above, the city of Maplewood established Development District No. 1 and adopted a Development District Program to implement the goals and objectives thereof,all pursuant to Minnesota Statutes, sections 469.124 through 469.133; and WHEREAS, to implement the goals of the Development District Program, MEDA established Tax Increment Financing District No. 1-17 and adopted a tax increment financing plan related thereto, all pursuant to Minnesota Statutes, sections 469.174 through 469.1794; and WHEREAS, the Redeveloper has proposed to redevelop the properties located at 1136 and 1160 Frost Avenue E., 0 Phalen Place, and intervening rights-of-way in Maplewood, Minnesota through a project which MEDA believes is in the vital and best interests of Maplewood and the health, safety and welfare of its residents, and in accord with the public purposes and provisions of the applicable state and local laws and requirements for which Development District No. 1 and Tax Increment Financing District No. 1-17 were established. EDA Special Meeting Packet Page Number 12 of 103 G1, Attachment 2 NOW, THEREFORE, in consideration of the covenants and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: ARTICLE I Definitions Section 1.1. Definitions. In this Agreement the following terms shall have the meanings given unless a different meaning clearly appears from the context: “Administrative Costs” means the administrative expenses incurred by MEDA as defined in section 469.174, subd. 14 of the TIF Act; “Agreement” means this Agreement, as the same may be from time to time modified, amended, or supplemented. “Available Tax Increment” means 95 percent of the Tax Increment paid to MEDA by the County with respect to the Redevelopment Property and the Minimum Improvements. “Certificate of Completion” means the certificate, in substantially the form attached hereto as Exhibit D, which will be provided to the Redeveloper pursuant to Article IV of this Agreement. “City” means the city of Maplewood, a municipal corporation under the laws of Minnesota. “City Approvals” means, collectively, the comprehensive plan amendment, conditional use permit, design review and right-of-way vacation granted by the City on December 12, 2022 to facilitate construction of the Minimum Improvements. “City Development Districts Act” means Minnesota Statutes, sections 469.124 through 469.133, as amended. “County” means Ramsey County, Minnesota. “Development District” means the City’s Development District No. 1. “Development District Program” or “Program” means the plan for development and redevelopment of Development District No. 1, which was most recently modified by the City on June 26, 2023. “Economic Development Authorities Act” or “EDA Act” means Minnesota Statutes, sections 469.090 through 469.108, as amended. “Event of Default” means an action by the Redeveloper or MEDA listed in Article VIII of this Agreement. EDA Special Meeting Packet Page Number 13 of 103 G1, Attachment 2 “Housing and Redevelopment Authorities Act” or “HRA Act” means Minnesota Statutes, sections 469.001 through 469.047, as amended. “Maplewood Economic Development Authority” or “MEDA” has the meaning set forth in the preamble of this Agreement. “Mat urity Date” means the date the Note has been paid in full or terminated, whichever is earlier. “Minimum Improvements” means demolition of the current improvements and construction of a market rate apartment building containing approximately 150 units on the Redevelopment Property. After completion of the Minimum Improvements, the term shall mean the Redevelopment Property as improved by the Minimum Improvements. The Minimum Improvements are generally depicted on Exhibit B attached hereto. “Note” means the taxable Tax Increment Revenue Note, in substantially the form attached hereto as Exhibit D, to be delivered by MEDA to the Redeveloper pursuant to Article III of this Agreement. “Payment Date” means, with respect to the Note, August 1, 2025 and each February 1 and August 1 thereafter through the final payment on February 1, 2039. “Qualifying Costs” means the cost, in an estimated amount of $4,500,000, incurred by the Redeveloper related to completion of the Minimum Improvements which MEDA intends to partially reimburse through issuance of the Noteand which are listed on Exhibit G attached hereto. “Red eveloper” has the meaning set forth in the preamble of this Agreement. “Redevelopment Assistance” means the financial assistance to be offered by MEDA to the Redeveloper through issuance of the Note. “Redevelopment Property” means the properties located at 1136 and 1160 Frost Avenue E., 0 Phalen Place, and intervening rights-of-way upon which the Minimum Improvements will be constructed. The property is legally described in Exhibit A. “Sale” means any conveyance or transfer of fee simple title to the Minimum Improvements or the Redevelopment Property, as more fully defined in Article VII of this Agreement. “St ate” means the state of Minnesota. “S ubstantial Completion”or “Substantially Completed” means completion of the Minimum Improvements to a degree allowing the issuance of a certificate of occupancy or temporary certificate of occupancy by the City’s building official. EDA Special Meeting Packet Page Number 14 of 103 G1, Attachment 2 “Tax Appeal” means any petition or other action seeking a reduction to less than $34,500,000 in the market value of the Redevelopment Property or Minimum Improvements under any State law. “Tax Increment” means the tax increment, as that term is defined in Minnesota Statutes, section 469.174, subd. 25, which is paid to MEDA by the County with respect to the Redevelopment Property and the Minimum Improvements. “Tax Increment Financing Act” or “TIF Act” means Minnesota Statutes, se ctions 469.174 through 469.1794, as amended. “Tax Increment Financing District” or “TIF District” means MEDA’s Tax Increment Financing District No. 1-17, a redevelopment district. “Tax Increment Financing Plan” or “TIF Plan” means the tax increment plan for Tax Increment Financing District No. 1-17 which was approved by MEDA and the City on June 26, 2023. “Tax Official” means the County assessor, County auditor, County or state board of equalization, the commissioners of revenue of the State, or any State or federal district court, the tax court of the State, or the State Supreme Court. “Termination Date” means the date Tax Increment Financing District No. 1-17 terminates, which is estimated to be after 25 years after the date of receipt of the first increment, or the date the Note has been paid through Available Tax Increment or terminated and all other obligations of the TIF District have been paid or satisfied, whichever occurs first. “Unavoidable Delays” means delays which are the direct result of unanticipated adverse weather conditions; strikes or other labor troubles; pandemic, epidemic; government mandated quarantine or travel bans; government mandated closures, declared state of emergency or public health emergency; fire or other casualty to the Minimum Improvements; litigation commenced by third parties which, by injunction or other similar judicial action, directly results in delays; or, except those of MEDA or the City reasonably contemplated by this Agreement, any acts or omissions of any federal, State or local governmental unit which directly result in delays in construction of the Minimum Improvements. Section 1.2. Exhibits. The following exhibits are attached to and by reference made a part of this Agreement: Exhibit A. Legal description of the Redevelopment Property Exhibit B. Depiction of the Redevelopment Property and Minimum Improvements Exhibit C. Form of Certificate of Completion Exhibit D. Form of Note Exhibit E. Form of Investment Letter Exhibit F. Estimated Total Redevelopment Costs Exhibit G. List of Qualifying Costs EDA Special Meeting Packet Page Number 15 of 103 G1, Attachment 2 Section 1.3. Rules of Interpretation. (a) This Agreement shall be interpreted in accordance with and governed by the laws of Minnesota. (b) The words “herein” and “hereof” and words of similar import, without reference to any particular section or subdivision, refer to this Agreement as a whole rather than any particular section or subdivision hereof. (c) References herein to any particular section or subdivision hereof are to the section or subdivision of this Agreement as originally executed. (d) Any titles of the several parts, articles and sections of this Agreement are inserted for convenience and reference only and shall be disregarded in construing or interpreting any of its provisions. ARTICLE II Representations and Warranties Section 2.1. Representations by MEDA. MEDA makes the following representations as the basis for the undertaking on its part herein contained: (a) MEDA is an economic development authority duly organized and existing under the EDA Act and also having the powers of a housing and redevelopment authority under the HRA Act and of a city under the City Development Districts Act. MEDA has the authority to enter into this Agreement and carry out its obligations hereunder. (b) The individuals executing this Agreement and related agreements and documents on behalf of MEDA have the authority to do so and to bind MEDA by their actions. (c) TIF District No. 1-17 is a redevelopment tax increment financing district within the meaning of the TIF Act and was created, adopted and approved in accordance with the TIF Act. The Redevelopment Property is within TIF District No. 1-17. (d) There are no previous agreements to which MEDA is a party pertaining to the Redevelopment Property which would preclude the parties from entering into this Agreement or which would impede the fulfillment of the terms and conditions of this Agreement. (e) The activities of MEDA pursuant to this Agreement are undertaken pursuant to the Program and TIF Plan and are for the purpose of assisting the redevelopment of the Redevelopment Property. (f) MEDA will act in a timely manner to consider all approvals required under this Agreement and will cooperate with the Redeveloper in seeking consideration by the City of any additional approvals which must be granted by the City. EDA Special Meeting Packet Page Number 16 of 103 G1, Attachment 2 Section 2.2. Representations and Warranties by the Redeveloper. The Redeveloper makes the following representations and warranties as the basis for the undertaking on its part herein contained: (a)The Redeveloper is a limited liability company validly existing under the laws of Delaware. The Redeveloper has the authority to enter into this Agreement and carry out its obligations hereunder. (b)The persons executing this Agreement and related agreements and documents on behalf of the Redeveloper have the authority to do so and to bind the Redeveloper by their actions. (c)The Redeveloper has analyzed the economics of the cost of the Minimum Improvements and concluded that, absent the Redevelopment Assistance to be offered under this Agreement, it would not undertake this project. (d)Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement is prevented, limited by or conflicts with or results in a breach of, the terms, conditions or provisions of any limited liability company organizational documents or any evidence of indebtedness, agreement or instrument of whatever nature to which the Redeveloper is now a party or by which it is bound, or constitutes a default under any of the foregoing. ARTICLE III Redevelopment Assistance Section 3.1. Issuance of Pay-As-You-Go Note. (a) In consideration of the Redeveloper constructing the Minimum Improvements and to finance the reimbursement of the Qualifying Costs, MEDAwill issue and the Redeveloper will purchase the Note in a principal amount not to exceed $4,500,000 and in substantially the form set forth in Exhibit D attached hereto. The Note will bear simple, non-compounding interest at the lesser of 5.25 percent per annum or the rate of the Redeveloper’s first mortgage. MEDA and the Redeveloper agree that the consideration from the Redeveloper for the purchase of the Note will consist of the Redeveloper’s payment of the Qualifying Costs, and other expenditures which are eligible for reimbursement with Tax Increment and which are incurred by the Redeveloper in at least the principal amount of the Note. MEDA will deliver the Note upon satisfaction by the Redeveloper of all the conditions precedent specified in section 3.2 of this Agreement. (b)The Redeveloper understands and acknowledges that MEDAmakes no representations or warranties regarding the amount of Available Tax Increment, or that revenues pledged to the Note will be sufficient to pay the principal of and interest on the Note. Any estimates of Tax Increment prepared by MEDAor its financial advisors in connection with the TIF District or this Agreement are for the benefit of MEDAand are not intended as representations on which the Redeveloper may rely. EDA Special Meeting Packet Page Number 17 of 103 G1, Attachment 2 Section 3.2. Conditions Precedent to Issuance of Note. Notwithstanding anything in this Agreement to the contrary, MEDA shall not be obligated to issue the Note until all of the following conditions precedent have been satisfied: (a)MEDA and the Redeveloper have executed this Agreement and it has been recorded in the County land records; (b)The Redeveloper hasacquired the Redevelopment Property in fee and Substantially Completed the Minimum Improvements; (c)T he Redeveloper has submitted evidence it has paid for the Qualifying Costs in an aggregate amount at least equal to the principal amount of the Note, it being agreed that paid receipts and lien waiversare sufficient evidence; (d)The Redeveloper has submitted evidence of its actual total redevelopment costs for each line item in Exhibit F; (e)MEDA has issued the Certificate of Completion; (f)The Redeveloper has submitted the Investment Letter; (g)The Redeveloper has paid all fees required under section 9.12 of this Agreement and all other fees due to the City associated with the Redevelopment Property or the Minimum Improvements; and (h)There has been no Event of Default on the part of the Redeveloper which is continuing or has not been cured. Section 3.3. Records. MEDA and its representatives will have the right at all reasonable times after reasonable notice to inspect, examine and copy invoices paid by Redeveloper and/or its general contractorrelating to the Qualifying Costs for which the Redeveloper will be reimbursed under the Note. Section 3.4. Terms, Execution and Delivery of Note. (a)The Note will be issued as a single typewritten note numbered R-1. The Note will be issuable only in fully registered form. Principal of and interest on the Note will be payable by check or draft issued by the Registrar described herein. (b)Principal of and interest on the Note will be payable by mail to the owner of record th thereof as of the close of business on the 15 day of the month preceding the Payment Date, whether or not the day is a business day. (c)MEDA hereby appoints MEDA’s Executive Director to perform the functions of registrar, transfer agent and paying agent (the “Registrar”). The effect of registration and the rights and duties of MEDA and the Registrar with respect thereto will be as follows: EDA Special Meeting Packet Page Number 18 of 103 G1, Attachment 2 (i) The Registrar will keep at her office a bond register in which the Registrar will provide for the registration of ownership of the Note and the registration of transfers and exchanges of the Note. (ii) Upon surrender for transfer of the Note duly endorsed by the registered owner thereof or accompanied by a written instrument of transfer, in form reasonably satisfactory to the Registrar, duly executed by the registered owner thereof or by an attorney duly authorized by the registered owner in writing, the Registrar will authenticate and deliver, in the name of the designated transferee or transferees, a new Note of a like aggregate principal amount and maturity, as requested by the transferor. Notwithstanding the foregoing, the Note will not be transferred to any person other than an affiliate, or other related entity, of the owner unless MEDA has been provided with an investment letter in a form substantially similar to the investment letter submitted by the owner or a certificate of the transferor, in a form satisfactory to MEDA, that the transfer is exempt from registration and prospectus delivery requirements of federal and applicable state securities laws. The Registrar may close the books for registration of any transfer after the fifteenth day of the month preceding each Payment Date and until the final Payment Date. (iii) The Note surrendered upon any transfer will be promptly cancelled by the Registrar and thereafter disposed of as directed by MEDA. (iv) When the Note is presented to the Registrar for transfer, the Registrar may refuse to transfer the same until she is satisfied that the endorsement on the Note or separate instrument of transfer is legally authorized. The Registrar will incur no liability for her refusal, in good faith, to make transfers which she, in her judgment, deems improper or unauthorized. (v) MEDA and the Registrar may treat the person in whose name the Note is at any time registered in the bond register as the absolute owner of the Note, whether the Note is overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on the Note and for all other purposes, and all the payments so made to any registered owner or upon the owner’s order will be valid and effectual to satisfy and discharge the liability of MEDA upon the Note to the extent of the sum or sums so paid. (vi) For every transfer or exchange of the Note, the Registrar may impose a charge upon the owner thereof sufficient to reimburse the Registrar for any tax, fee, or other governmental charge required to be paid with respect to the transfer or exchange. (vii) In case the Note becomes mutilated or is lost, stolen, or destroyed, the Registrar will deliver a new Note of like amount, maturity dates and tenor in exchange and substitution for and upon cancellation of the mutilated Note or in lieu of and in substitution for the Note which is lost, stolen, or destroyed, upon the payment of the reasonable expenses and charges of the Registrar in connection therewith; and, in the case the Note which is lost, stolen, or destroyed, upon filing with the Registrar of evidence satisfactory which is it that the Note which is lost, stolen, or destroyed, and of the ownership thereof, EDA Special Meeting Packet Page Number 19 of 103 G1, Attachment 2 and upon furnishing to the Registrar of an appropriate bond or indemnity in form, substance, and amount satisfactory to it, in which both MEDA and the Registrar will be named as obligees. The Note so surrendered to the Registrar will be cancelled by her and evidence of the cancellation will be given to MEDA. If the mutilated, lost, stolen, or destroyed Note has already matured or been called for redemption in accordance with its terms, it will not be necessary to issue a new Note prior to payment. Section 3.5. Preparation and Delivery. The Note will be prepared under the direction of the Executive Director and will be executed on behalf of MEDA by the signatures of its President and Executive Director. In case any officer whose signature appears on the Note ceases to be the officer before the delivery of the Note, the signature will nevertheless be valid and sufficient for all purposes, the same as if the officer had remained in office until delivery. When the Note has been so executed, it will be delivered by MEDA to the owner following satisfaction of the conditions precedent. Section 3.6. Security Provisions. (a)MEDA hereby pledges to the payment of the principal of and interest on the Note all Available Tax Increment as defined in this Agreement. Available Tax Increment will be applied to payment of the principal of and interest on the Note in accordance with the terms of the Note. (b)Until the date the Note is no longer outstanding and no principal thereof or interest thereon remains unpaid, MEDA will maintain a separate and special “Bond Fund” to be used for no purpose other than the payment of the principal of and interest on the Note. MEDA irrevocably agrees to appropriate to the Bond Fund in each year Available Tax Increment. Any Available Tax Increment remaining in the Bond Fund will be transferred to MEDA’s account for the TIF District upon the payment of all principal and interest to be paid with respect to the Note. Section 3.7. Lookback Provisions and Reduction of Note.The amount of the Redevelopment Assistance has been established based on an estimate of the Redeveloper’s total redevelopment costs for the Minimum Improvements. After completion of the Minimum Improvements but prior to issuance of the Note,the Redeveloper agrees to submit evidence of its actual costs to MEDA for comparison with the estimated costs listed on Exhibit F. If the actual total redevelopment costs are more than $50,000 lower than the estimated total redevelopment costs listed in Exhibit F, the principal amount of the Note will be reduced by one-half of the amount by which the estimated costs exceed the actual costs. The Note will not be issued until MEDA has compared actual with estimated total redevelopment costs as described herein and adjusted the principal amount of the Note, if necessary. ARTICLE IV Construction of Minimum Improvements, Infrastructure Improvements and Site Improvements Section 4.1. Construction of Minimum Improvements. (a) The Redeveloper agrees that it will construct the Minimum Improvements on the Redevelopment Property. In addition to the EDA Special Meeting Packet Page Number 20 of 103 G1, Attachment 2 requirements of this Agreement, construction of the Minimum Improvements will necessitate compliance with the City Approvals and possibly approval of other governmental agencies. To the extent such approvals have not already been obtained, the Redeveloper agrees to submit all applications for and pursue to their conclusion all other approvals needed prior to constructing the Minimum Improvements. (b) The Developer agrees to pay the City all fees required to construct the Minimum Improvements, including plan review fee, building permit fee and state surcharges, in the amounts provided under the City’s then-current fee schedule. The Minimum Improvements and Redevelopment Property must meet the requirements of the Maplewood Green Building Program. A de-construction permit is required for removal of the existing building, which will require that 75 percent of the materials removed must be diverted from landfills. A full report detailing the de-construction procedure must be submitted with the permit. The County Department of Health must be notified at least 10 days prior to issuance of the de-construction permit. Section 4.2. Commencement and Completion of Construction. The Redeveloper agrees to acquire all of the Redevelopment Property in fee by June 30, 2023. Subject to Unavoidable Delays, the Redeveloper shall commence construction of the Minimum Improvements by no later than December 31, 2023 which shall mean beginning of physical improvement to the Redevelopment Property by demolition, grading, excavation or other physical preparation work. The Minimum Improvements shall be Substantially Complete by no later than December 31, 2025. Section 4.3. Certificate of Completion. After Substantial Completion of the Minimum Improvements in accordance with all terms of this Agreement and at the written request of the Redeveloper, MEDA will, within 20 days thereafter, furnish a Certificate of Completion in the form of Exhibit D attached hereto. Section 4.4. Reconstruction of Minimum Improvements. If the Minimum Improvements on the Redevelopment Property are damaged or destroyed before issuance of a Certificate of Completion, the Redeveloper agrees, for itself and its successorsand assigns, to reconstruct or cause the reconstruction of the Minimum Improvements on the Redevelopment Property within two years of the date of the damage or destruction. The Minimum Improvements shall be reconstructed in accordance with the original construction plans, or such modifications thereto as may be agreed to by the City and MEDA. ARTICLE V Business Subsidy; Park Dedication Fee Section 5.1. No Business Subsidy. Because the Redevelopment Assistance offered by MEDA to the Redeveloper is related to housing, the Business Subsidy Act, Minnesota Statutes, sections 116J.193 through 116J.195, does not apply. Section 5.2. Park Dedication Fee. The Developer agrees to pay the City a park dedication fee in the amount of $54,684 prior to issuance of the building permit for the Minimum Improvements. EDA Special Meeting Packet Page Number 21 of 103 G1, Attachment 2 ARTICLE VI yment of Taxes; Use of Tax I Pancrement Section 6.1. Taxes. The Redeveloper agrees to pay before delinquency directly to the taxing authority, all taxes, general and special assessments, and other public charges levied upon or assessed against the Redevelopment Property and any buildings, structures, fixtures, or improvements thereon which first become due during the term of this Agreement. Section 6.2. Right to Collect Delinquent Taxes. The Redeveloper acknowledges that at all times prior to the Termination Date, MEDA shall have the right to sue the Redeveloper or its successors and assigns to collect delinquent real estate taxes and any penalty or interest thereon and to pay over the same as a tax payment to the County auditor. In any such suit in which MEDA prevails, MEDA shall also be entitled to recover its reasonable out-of-pocket costs, expenses and attorney fees. Section 6.3. Reduction of Taxes.(a) The Redeveloper agrees that prior to the Termination Date it will not cause a reduction in the real property taxes paid in respect of the Redevelopment Property through:(i) willful destruction of the Minimum Improvements or Redevelopment Property or any part thereof; or (ii) willful refusal to reconstruct damaged or destroyed property. The Redeveloper also agrees that it will not, prior to the Termination Date, apply for an exemption from or a deferral of property tax on the Minimum Improvements or Redevelopment Property pursuant to any law, or transfer or permit transfer of the Minimum Improvements or Redevelopment Property to any entity whose ownership or operation of the property would result in the Minimum Improvements or Redevelopment Property being exempt from real property taxes under State law. (b)The Redeveloper agrees to notify MEDA within 10 days of filing any Tax Appeal. If as of any Payment Date, any Tax Appeal is then pending, MEDA will continue to make payments on the TIF Note but only to the extent that the Available Tax Increment relates to property taxes paid with respect to the market value not being challenged as part of the Tax Appeal, as determined by MEDA in its sole discretion. MEDA will withhold the Available Tax Increment related to property taxes paid with respect to the market value being challenged as part of the Tax Appeal, as determined by MEDA in its sole discretion. MEDA will apply any withheld amount to the extent not reduced as a result of the Tax Appeal promptly after the Tax Appeal is fully resolved and the amount of Available Tax Increment, as applicable, attributable to the disputed tax payments is finalized. (c)Notwithstanding anything herein to the contrary, the Redeveloper may not file any tax appeal regarding the market value of the Redevelopment Property or the Minimum Improvements, regardless of the then-current market value, during the final three years prior to the final payment under the Note. Section 6.4. Use of Tax Increment. Except as provided for in this Agreement, MEDA shall be free to use any Tax Increment it receives from the County with respect to TIF District No. EDA Special Meeting Packet Page Number 22 of 103 G1, Attachment 2 1-17 for any purpose for which such increment may lawfully be used under the TIF Act and MEDA shall have no obligations to the Redeveloper with respect to the use of such Tax Increment. ARTICLE VII Restrictions on Sale of Minimum Improvements Section 7.1. Prohibition Against Sale of Minimum Improvements. The Redeveloper represents and agrees that its use of the Redevelopment Property and its other undertakings pursuant to the Agreement, are, and will be, used for the purpose of construction of the Minimum Improvements and not for speculation in land holding. The Redeveloper represents and agrees that, prior to the issuance of a Certificate of Completion regarding the Minimum Improvements, there shall be no Sale of the Redevelopment Property or the Minimum Improvements constructed thereon nor shall the Redeveloper suffer any such Sale to be made, without the prior written approval of MEDA, which approval shall not be unreasonably withheld, conditioned or delayed; provided however, notwithstanding the foregoing, the Redeveloper shall be entitled to lease units in the apartment building to third parties without the prior written approval of MEDA. As a condition of approval of any such sale in cases where such approval is required, MEDA shall require, at a minimum, that the proposed transferee shall have entered into an agreement whereby the transferee expressly assumes all of the Redeveloper’s obligations under this Agreement. Any such agreement shall include MEDA as a party and otherwise be in form and substance reasonably acceptable to MEDA. Notwithstanding anything herein to the contrary, the Redeveloper shall not be required to obtain approval from MEDA for any such Sale after issuance of the Certificate of Completion. ARTICLE VIII Events of Default Section 8.1. Events of Default Defined. Each and every one of the following shall be an Event of Default under this Agreement: (a) Failure of the Redeveloper to pay real estate taxes or special assessments on the Redevelopment Property or Minimum Improvements as they become due; (b) Failure by the Redeveloper to commence and Substantially Complete construction of the Minimum Improvements pursuant to the terms, conditions and limitations of Article IV of this Agreement, including the timing thereof, unless such failure is caused by an Unavoidable Delay or waived by MEDA; (c) If the Redeveloper shall file a petition in bankruptcy, or shall make an assignment for the benefit of its creditors or shall consent to the appointment of a receiverand such petition is not vacated within sixty (60) days of filing; (d) Sale of the Redevelopment Property or the Minimum Improvements, or any portion thereof, by the Redeveloper in violation of Article VII of this Agreement; or EDA Special Meeting Packet Page Number 23 of 103 G1, Attachment 2 (e)Failure by either party to observe or perform any material covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement, including but not limited to any action necessary for the establishment of the TIF District or any action prohibited by section 6.3 of this Agreement. Section 8.2. Remedies on Default. Whenever any Event of Default referred to in section8.1 of this Agreement occurs, the non-defaulting party may take any one or more of the following actions after providing 30 days written notice to the defaulting party of the Event of Default, but only if the Event of Default has not been cured within said 30 days from the receipt of Notice or, if the Event of Default is by its nature incurable within 30 days, the defaulting party does not provide assurances to the non-defaulting party reasonably satisfactory to the non- defaulting party that the Event of Default will be cured and will be cured as soon as reasonably possible: (a)Suspend its performance under this Agreement until it receives assurances from the defaulting party, deemed adequate by the non-defaulting party, that the defaulting party will cure its default and continue its performance under this Agreement; (b)If the default occurs prior to completion of the Minimum Improvements, MEDA may withhold any undelivered Certificate of Completion until such default is cured; (c)If the default occurs after issuance of the Certificate of Completion, MEDA may suspend payments under the Note or terminate the Note; and (d)Take whateverreasonable action, including legal or administrative action, which may appear necessary or desirable to the non-defaulting party to collect any payments due under this Agreement or to enforce performance and observance of any obligation, agreement, or covenant of the defaulting party under this Agreement. ction 8.3. No Remedy Exclusive. No remedy conferred herein or reserved to the parties Se is intended to be exclusive of any other available remedy or remedies, but each and every remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle MEDA or the Redeveloper to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such notice as may be required in Article IX of this Agreement. Section 8.4. No Additional Waiver Implied by One Waiver. In the event any covenant or agreement contained in this Agreement should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. EDA Special Meeting Packet Page Number 24 of 103 G1, Attachment 2 ARTICLE IX ditional Provisions Ad Section 9.1. Conflict of Interests; Representatives Not Individually Liable. No member, official, or employee of MEDA shall have any personal financial interest, direct or indirect, in the Agreement, nor shall any such member, official, or employee participate in any decision relating to the Agreement which affects his or her personal financial interests or the interests of any corporation, partnership, or association in which he or she is, directly or indirectly, interested. No member, official, or employee of MEDA shall be personally liable to the Redeveloper, or any successor in interest, in the event of any default or breach or for any amount which may become due or on any obligations under the terms of this Agreement. Section 9.2. Restrictions of Use. The Redeveloper agrees that through the Termination Date it will use or allow the use of the Minimum Improvements only for such uses as permitted under the City’s land use regulations. Section 9.3. Notices and Demands. Except as otherwise expressly provided in this Agreement, any notice, demand, or other communication under the Agreement or any related document by either party to the other shall be sufficiently given or delivered if it is dispatched by registered or certified United States mail, postage prepaid, return receipt requested, or delivered personally to: (a)in the case of the Redeveloper:Frost Avenue Group, LLC 4450 Excelsior Boulevard, Suite 400 St. Louis Park, MN 55416 Attn: (b)in the case of MEDA:Maplewood Economic Development Authority 1830 County Road B East Maplewood, MN 55109-2702 Attn: Executive Director and with a copy to: Kennedy & Graven, Chartered 150 South Fifth Street, Suite 700 Minneapolis, MN 55402 Attn: Ronald H. Batty or at such other address with respect to either such party as that party may, from time to time, designate in writing and forward to the other as provided in this section 9.3. Section 9.4. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute one and the same instrument. EDA Special Meeting Packet Page Number 25 of 103 G1, Attachment 2 Section 9.5. Disclaimer of Relationships. The Redeveloper acknowledges that nothing contained in this Agreement nor any act by MEDA or the Redeveloper shall be deemed or construed by the Redeveloper or by any third person to create any relationship of third-party beneficiary, principal and agent, limited or general partner, or joint venture between MEDA and the Redeveloper. Section 9.6. Amendment; Assignment. This Agreement may be amended only by the written agreement of the parties. Section 9.7. Recording. MEDA intends to record this Agreement among the County land records and the Redeveloper agrees to pay for the cost of recording same. Section 9.8. Releas e and Indemnification Covenants. a) Except for any negligent act of the following named parties, the Redeveloper hereby releases from and covenants and agrees that MEDA, and its governing body members, officers, agents, servants, and employees (the “Indemnified Parties”) shall not be liable for, and hereby agrees to indemnify and hold harmless the Indemnified Parties against any loss or damage to property or any injury to or death of any person occurring at or about or resulting from any defect in the Minimum Improvements. b) Except for any willful misrepresentation or any willful or wanton misconduct or negligence of the Indemnified Parties, the Redeveloper hereby agrees to protect and defend the Indemnified Parties, now or forever, and hereby further agrees to hold the aforesaid harmless from any claim, demand, suit, action or other proceeding whatsoever by any person or entity whatsoever arising or purportedly arising from this Agreement, or the transactions contemplated hereby or the construction, installation, ownership, and operation of the Redevelopment Property or the Minimum Improvements. c) Except for any negligent act of the Indemnified Parties, the Indemnified Parties shall not be liable for any damage or injury to the persons or property of the Redeveloper or its partners, officers, agents, servants or employees or any other person who may be about the Redevelopment Propertyor the Minimum Improvements due to any act of negligence of any person. Section 9.9. Titles of Articles and Sections. Any titles of the several parts, articles, and sections of this Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 9.10. Governing Law; Venue. This Agreement shall be construed in accordance with the laws of Minnesota. Any dispute arising from this Agreement shall be heard in the State or federal courts of Minnesota, and all parties waive any objection to the jurisdiction thereof, whether based on convenience or otherwise. Section 9.11. Agreement Runs with the Land. This Agreement runs with the Redevelopment Property and shall be binding on and inure to the benefit of the parties and their respective heirs, successors and assigns. EDA Special Meeting Packet Page Number 26 of 103 G1, Attachment 2 Section 9.12. Fees and Charges. The Redeveloper agrees to reimburse MEDA for all reasonable fees or costs for legal, financial advisory, engineering, planning or other staff time for preparation of the modification to the Program, preparation of the TIF Plan and related documents; the analysis, drafting or negotiating this Agreement and related documents and the recording thereof; and for reviewing any plans regarding the Minimum Improvements submitted in satisfaction of this Agreement. The Redeveloper has made a deposit of $6,700 regarding such costsand agrees to make an additional deposit of $10,000 at the time of execution of this Agreement. MEDA will notify the Redeveloper at such time as the deposit is near depletion and request an additional deposit if necessary. Upon request by the Redeveloper, MEDA will attempt to estimate the additional costs and expenses likely to be incurred by the Redeveloper but the Redeveloper’s financial obligations to MEDA in this regard are not limited by that estimate. The Redeveloper agrees to pay such additional amounts as may be billed by MEDA within 30 days of receipt of an invoice from MEDA. ******************* EDA Special Meeting Packet Page Number 27 of 103 G1, Attachment 2 IN WITNESS WHEREOF, MEDA and the Redeveloper have caused this Agreement to be duly executed in their names and behalves on or as of the date first above written. MEDA: THE MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY By: Marylee Abrams, President ATE OF MINNESOTA ) ST ) ss. COUNTY OF RAMSEY ) The foregoing instrument as acknowledged before me this _____ day of ____________, 2023, by Marylee Abrams, the President of the Maplewood Economic Development Authority, a public body corporate and politic under the laws of Minnesota, on behalf of the Economic Development Authority. Notary Public By: Melinda Coleman, Executive Director ATE OF MINNESOTA ) ST ) ss. COUNTY OF RAMSEY ) The foregoing instrument as acknowledged before me this _____ day of ____________, 2023, by Melinda Coleman, the Executive Director of the Maplewood Economic Development Authority, a public body corporate and politic under the laws of Minnesota, on behalf of the Economic Development Authority. Notary Public EDA Special Meeting Packet Page Number 28 of 103 G1, Attachment 2 FROST AVENUE GROUP, LLC By: _________________________ ________________ STATE OF _________ ) ) ss. COUNTY OF ________ ) The foregoing instrument was executed before me this _____ day of _______________, 2023, by _______________, the ____________ of Frost Avenue Group, LLC, a limited liability company under the laws of Delaware, on behalf of the company. ____________________________________ Notary Public EDA Special Meeting Packet Page Number 29 of 103 G1, Attachment 2 EXHIBIT A TO REDEVELOPMENT AGREEMENT LEGAL DESCRIPTION OF REDEVELOPMENT PROPERTY The Redevelopment Property consists of the following parcels in Ramsey County, Minnesota: Lots 1 through 20, inclusive, Block 1, Kavanaugh and Dawson’s Addition to Gladstone, together with the vacated alley in said Block 1; and D# 16-29-22-42-0003 PI (add legal of Maplewood Marine) EDA Special Meeting Packet Page Number 30 of 103 G1, Attachment 2 EXHIBIT B TO REDEVELOPMENT AGREEMENT DEPICTION OF THE REDEVELOPMENT PROPERTY AND MINIMUM IMPROVEMENTS \[to be completed\] EDA Special Meeting Packet Page Number 31 of 103 G1, Attachment 2 EXHIBIT C TO REDEVELOPMENT AGREEMENT FORM OF CERTIFICATE OF COMPLETION WHEREAS, the Maplewood Economic Development Authority, a public body corporate and politic under the laws of Minnesota (“MEDA”), and _____________, a _____________ under the laws of ________ (the “Redeveloper”), have entered into a certain Contract for Private Redevelopment (the “Agreement”) dated the ____ day of ____________, 2023, and recorded in the office of the County Recorder in Ramsey County, Minnesota, as Document No. __________, which Agreement contained certain covenants and restrictions regarding completion of the Minimum Improvements, as defined in the Agreement; and WHEREAS, the Redeveloper has performed said covenants and conditions in a manner deemed sufficient by MEDA to permit the execution and recording of this certification. NOW, THEREFORE, this is to certify that all construction of the Minimum Improvements specified to be done and made by the Redeveloper or to be caused by the Redeveloper has been completed and the covenants and conditions in the Agreement have been performed by the Redeveloper, and the County Recorder in Ramsey County, Minnesota, is hereby authorized to accept for recording and to record the filing of this instrument, to be a conclusive determination of the satisfactory termination of the covenants and conditions relating to completion of the Minimum Improvements. Dated: _______________. MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY By ______________________________ ____________, Executive Director STATE OF MINNESOTA ) ) ss. COUNTY OF ________ ) The foregoing instrument as acknowledged before me this _____ day of _________, 20___, by ____________________, the executive director of the Maplewood Economic Development Authority, a public body corporate and politic under the laws of Minnesota, on behalf of the Economic Development Authority. ____________________________________ Notary Public EDA Special Meeting Packet Page Number 32 of 103 G1, Attachment 2 This Instrument Drafted By: DY & GRAVEN, CHARTERED (RHB) KENNE 150 South Fifth Street Suite 700 Minneapolis, MN 55402 (612)337-9300 EDA Special Meeting Packet Page Number 33 of 103 G1, Attachment 2 EXHIBIT D TO REDEVELOPMENT AGREEMENT FORM OF NOTE UNITED STATE OF AMERICA STATE OF MINNESOTA RAMSEY COUNTY MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY No. R-1 $4,500,000 TAXABLE TAX INCREMENT REVENUE NOTE SERIES ______ Date Rate of Original Issue \[lesser of 5.25% or rate of first mortgage\] __________ The Maplewood Economic Development Authority (“MEDA”), for value received, certifies that it is indebted and hereby promises to pay to Frost Avenue Group, LLC, or registered assigns (the “Owner”), the principal sum of $4,500,000 and to pay interest thereon at the rate of \[lesser of 5.25% or rate of first mortgage\] per annum, as and to the extent set forth herein. Interest shall be calculated on the basis of simple, non-compounding interest. 1. Payments. Principal and interest (“Payments”) will be paid on August 1, 2025, and each February 1 and August 1 thereafter to and including February 1, 2039 or until the Note is paid in full, whichever occurs first, (“Payment Dates”), in the amounts and from the sources set forth in Section 3 herein. Payments will be applied first to accrued interest, and then to unpaid principal. Payments are payable by mail to the address of the Owner or any other address as the Owner may designate upon 30 days written notice to MEDA. Payments on thisNote are payable in any coin or currency of the United States of America which, on the Payment Date, is legal tender for the payment of public and private debts. 2. Interest. Interest at the rate stated herein will accrue on the unpaid principal, commencing on the date of original issue. Interest will be computed on the basis of a year of 360 days and charged for actual days principal is unpaid. 3. Available Tax Increment. Payments on this Note are payable on each Payment Date in the amount of and solely payable from “Available Tax Increment,” which will mean, on each Payment Date, 95 percent of the Tax Increment attributable to the Redevelopment Property EDA Special Meeting Packet Page Number 34 of 103 G1, Attachment 2 (defined in the Agreement) and paid to MEDA by Ramsey County in the six months preceding the Payment Date, all as the terms are defined in the Contract for Private Development between MEDAand Owner dated as of ______________, 2023 (the “Agreement”). Available Tax Increment will not include any Tax Increment if, as of any Payment Date, there is an uncured Event of Default by the Owner under the Agreement. MEDAwill have no obligation to pay principal of and interest on this Note on each Payment Date from any source other than Available Tax Increment, and the failure of MEDA to pay the entire amount of principal or interest on this Note on any Payment Date will not constitute a default hereunder as long as MEDApays principal and interest hereon to the extent of Available Tax Increment. MEDA will have no obligation to pay unpaid balance of principal or accrued interest that may remain after the final Payment on February 1, 2039. 4.Optional Prepayment. The principal sum and all accrued interest payable under this Note is prepayable in whole or in part at any time by MEDAwithout premium or penalty. No partial prepayment will affect the amount or timing of any other regular payment otherwise required to be made under this Note. 5.Termination; Suspension. At MEDA’s option, this Note will terminate and MEDA’s obligation to make any payments under this Note will be discharged upon the occurrence and continuation of an Event of Default on the part of the Redeveloper as defined in Section 8.1 of the Agreement, but only if the Event of Default has not been cured in accordance with Section 8.2 of the Agreement. Payments under this Note may be suspended during any Tax Appeal in accordance with Section 6.3 of the Agreement. 6.Nature of Obligation. This Note is a single note in the total principal amount of $4,500,000 issued to aid in financing certain public redevelopment costs of Tax Increment Financing District No 1-17 undertaken by MEDA and is issued pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections 469.174 to 469.179, as amended. This Note is a limited obligation of MEDA which is payable solely from Available Tax Increment pledged to the payment hereof. This Note and the interest hereon will not be deemed to constitute a general obligation of the State of Minnesota or any political subdivision thereof, including, without limitation, MEDA or the city of Maplewood. Neither the State of Minnesota, nor any political subdivision thereof will be obligated to pay the principal of or interest on this Note or other costs incident hereto except out of Available Tax Increment, and neither the full faith and credit nor the taxing power of the State of Minnesota or any political subdivision thereof is pledged to the payment of the principal of or interest on this Note or other costs incident hereto. 7.Estimated Tax Increment Payments. Any estimates of Tax Increment prepared by MEDAor its financial advisors in connection with the TIF District or the Agreement are for the benefit of the MEDA, and are not intended as representations on which the Owner may rely. EDA Special Meeting Packet Page Number 35 of 103 G1, Attachment 2 MEDAMAKES NO REPRESENTATION OR WARRANTY THAT THE AVAILABLE TAX INCREMENT WILL BE SUFFICIENT TO PAY THE PRINCIPAL OF AND INTEREST ON THIS NOTE. 8. Registration and Transfer. This Note is issuable only as a fully registered note without coupons. Subject to certain limitations set forth therein, this Note is transferable upon the books of the MEDA kept for that purpose at the principal office of the Executive Director of MEDA as Registrar, by the Owner hereof in person or by the Owner’s attorney duly authorized in writing, upon surrender of this Note together with a written instrument of transfer satisfactory to MEDA, duly executed by the Owner. Upon the transfer or exchange and the payment by the Owner of any tax, fee, or governmental charge required to be paid by MEDA with respect to the transfer or exchange, there will be issued in the name of the transferee a new Note of the same aggregate principal amount, bearing interest at the same rate and maturing on the same dates. This Note will not be transferred to any person other than an affiliate, or other related entity, of the Owner unless MEDA has been provided with an investment letter in a form substantially similar to the investment letter submitted by the Owner or a certificate of the transferor, in a form satisfactory to MEDA, that the transfer is exempt from registration and prospectus delivery requirements of federal and applicable state securities laws. IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions, and things required by the Constitution and laws of the State of Minnesota to be done, to exist, to happen, and to be performed in order to make this Note a valid and binding limited obligation of MEDA according to its terms, have been done, do exist, have happened, and have been performed in due form, time and manner as so required. IN WITNESS WHEREOF, the board of commissioners of the Maplewood Economic Development Authority, has caused this Note to be executed with the manual signatures of its President and Executive Director, all as of the Date of Original Issue specified above. MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY President Executive Director REGISTRATION PROVISIONS The ownership of the unpaid balance of the within Note is registered in the bond register of the Executive Director of MEDA, in the name of the person last listed below. EDA Special Meeting Packet Page Number 36 of 103 G1, Attachment 2 Date of RegistrationRegistered Owner Signature of MEDA Executive Director Frost Avenue Group, LLC 4450 Excelsior Boulevard Suite 400 St. Louis Park, MN 55416 Federal Tax Id # __________ EDA Special Meeting Packet Page Number 37 of 103 G1, Attachment 2 EXHIBIT E TO REDEVELOPMENT AGREEMENT FOR M OF INVESTMENT LETTER To the Maplewood Economic Development Authority (“MEDA”) Attention: Executive Director Da ted: __________________, 20__ Re: $4,500,000 Tax Increment Revenue Note (Frost Avenue Group, LLC Project) The undersigned, as Purchaser of $4,500,000 in principal amount of the above-captioned Tax Increment Revenue Note (Frost Avenue Group, LLC Project)(the “Note”), hereby represents to you and to Kennedy & Graven, Chartered, Minneapolis, Minnesota, as legal counsel to MEDA, as follows: 1.We understand and acknowledge that the Note is delivered to the Purchaser on this date pursuant to the Contract for Private Development by and between MEDA and the Purchaser dated __________________, 2023 (the “Agreement”). 2.The Note is payable as to principal and interest solely from Available Tax Increment pledged to the Note, as defined therein. 3.We have sufficient knowledge and experience in financial and business matters, including purchase and ownership of municipal obligations, to be able to evaluate the risks and merits of the investment represented by the purchase of the above-stated principal amount of the Note. 4.We acknowledge that no offering statement, prospectus, offering circular or other comprehensive offering document or disclosure containing material information with respect to MEDAand the Note has been issued or prepared by MEDA, and that, in due diligence, we have made our own inquiry and analysis with respect to MEDA, the Note and the security therefor, and other material factors affecting the security and payment of the Note. 5.We acknowledge that we have either been supplied with or have access to information, including financial statements and other financial information, to which a reasonable investor would attach significance in making investment decisions, and we have had the opportunity to ask questions and receive answers from knowledgeable individuals concerning MEDA, the Note and the security therefor, and that as reasonable investors we have been able to make our decision to purchase the above-stated principal amount of the Note. EDA Special Meeting Packet Page Number 38 of 103 G1, Attachment 2 6.We have been informed that the Note (i) is not being registered or otherwise qualified for sale under the “Blue Sky” laws and regulations of any state, or under federal securities laws or regulations, (ii) will not be listed on any stock or other securities exchange, and (iii) will carry no rating from any rating service. 7.We acknowledge that MEDA and Kennedy & Graven, Chartered, as legal counsel to MEDA, have not made any representations or warranties as to the status of interest on the Note for the purpose of federal or state income taxation. 8.We represent to you that we are purchasing the Note for our own account and not for resale or other distribution thereof, except to the extent otherwise provided in the Note or as otherwise approved in writing by MEDA. 9.All capitalized terms used herein have the meaning provided in the Agreement unless the context clearly requires otherwise. 10.The Purchaser’s federal tax identification number is __________________. 11.We acknowledge receipt of the Note on the date hereof. IN WITNESS WHEREOF, the undersigned has executed this Investment Letter as of the date and year first written above. ____________________________ By: By: EDA Special Meeting Packet Page Number 39 of 103 G1, Attachment 2 EXHIBIT F TO REDEVELOPMENT AGREEMENT ESTIMATED TOTAL REDEVELOPMENT COSTS EDA Special Meeting Packet Page Number 40 of 103 G1, Attachment 2 EXHIBIT G TO REDEVELOPMENT AGREEMENT QUAL IFIED COSTS 1.Land Building Acquisition 2.Site Improvements/Preparation 3.Demolition of allExisting Improvementsand Site Cleanup 4.Underground Parking 5.Utilities 6.Other qualifying improvements EDA Special Meeting Packet Page Number 41 of 103 G1, Attachment 3 RESOLUTION _________ MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION AUTHORIZING INTERFUND LOAN FOR ADVANCE OF CERTAIN COSTS IN CONNECTION WITH TAX INCREMENT FINANCING DISTRICT NO. 1-17 BE IT RESOLVED by the Board of Commissioners of the Maplewood Economic Development Authority (“MEDA”) as follows: Section 1. Background. 1.01. MEDA has established Tax Increment Financing District No. 1-17 (the “TIF District”), pursuant to Minnesota Statutes, Sections 469.174 through 469.1794, as amended (the “TIF Act”). 1.02. MEDA has and will incur certain costs (the “Preliminary Costs”) related to the TIF District prior to such time as tax increment will be available to pay for such costs. 1.03. Pursuant to Section 469.178, subdivision 7 of the TIF Act, MEDA is authorized to advance or loan money from its general fund or any other fund from which such advances may be legally authorized in order to finance the Preliminary Costs. 1.04. MEDA will loan funds from its general fund (the “General Fund”), or any other fund designated by MEDA, to finance the Preliminary Costs in accordance with the terms of this resolution (the “Interfund Loan”). Section 2. Interfund Loan Authorized. 2.01. MEDA hereby authorizes the advance of up to $50,000 from the General Fund or other funds or so much thereof as may be required to pay the Preliminary Costs. MEDA shall reimburse itself for such advances together with interest at the rate stated below. Interest accrues on the principal amount from the date of each advance. The maximum rate of interest permitted to be charged is limited to the greater of the rates specified under Minnesota Statutes, Section 270C.40 and Section 549.09 as of the date the loan or advance is authorized, 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 5.0 percent and will not fluctuate. 2.02. Principal and interest (the “Payments”) on the Interfund Loan shall be paid semiannually on each February 1 and August 1 (each a “Payment Date”), commencing on the first Payment Date on which MEDA has Available Tax Increment (defined below), or on any other dates determined by MEDA’s Executive Director, through the date of last receipt of tax increment from the TIF District. 2.03. Payments on the Interfund Loan are payable solely from Available Tax Increment, which shall mean, on each Payment Date, tax increment available after other obligations of the TIF District have been paid, or as determined by MEDA’s Executive Director, generated in the preceding six months with respect to the property within the TIF District and remitted to MEDA by Ramsey County, Minnesota, all in accordance with the TIF Act. Payments shall be applied first to accrued interest, and then to unpaid principal. Payments on the Interfund Loan may be subordinated to any outstanding or future bonds or notes issued by MEDA and secured in whole or in part with tax increment from the TIF District. MA745\\36\\849946.v2 EDA Special Meeting Packet Page Number 42 of 103 G1, Attachment 3 2.04. The principal sum and all accrued interest payable under the Interfund Loan are prepayable in whole or in part at any time by MEDA without premium or penalty. No partial prepayment shall affect the amount or timing of any other regular payment otherwise required to be made under the Interfund Loan. 2.05. The Interfund Loan is evidence of an internal borrowing by MEDA in accordance with Section 469.178, subdivision 7 of the TIF Act, and is a limited obligation payable solely from Available Tax Increment pledged to the payment hereof under this resolution. This Interfund Loan and the interest hereon shall not be deemed to constitute a general obligation of the State of Minnesota or any political subdivision thereof, including, without limitation, MEDA or the city of Maplewood. Neither the State of Minnesota nor any political subdivision thereof shall be obligated to pay the principal of or interest on the Interfund Loan or other costs incident hereto except out of Available Tax Increment, and neither the full faith and credit nor the taxing power of the State of Minnesota or any political subdivision thereof is pledged to the payment of the principal of or interest on the Interfund Loan or other costs incident hereto. MEDA shall have no obligation to pay any principal amount of the Interfund Loan or accrued interest thereon, which may remain unpaid after the final Payment Date. 2.06. MEDA may at any time determine to forgive the outstanding principal amount and accrued interest on the Interfund Loan to the extent permissible under law. 2.07. MEDA may from time to time amend the terms of this resolution to the extent permitted by law, including without limitation amendment to the payment schedule and the interest rate; provided, however, that the interest rate may not be increased above the maximum specified in Section 469.178, subdivision 7 of the TIF Act. 2.08. MEDA officials and consultants are hereby authorized and directed to execute any documents or take any actions necessary or convenient to carry out the intent of this resolution. Section 3. Effective Date. This resolution is effective upon approval. Adopted by the Board of Commissioners of the Maplewood Economic Development Authority this th 26 day of June, 2023. Marylee Abrams, President ATTEST: Melinda Coleman, Executive Director 2 MA745\\36\\849946.v2 EDA Special Meeting Packet Page Number 43 of 103 G1, Attachment 4 Bepqujpo!Ebuf;!Kv!37-!3134! Nbqmfxppe!Fdpopnjd! Efwfmpqnfou!Bvuipsjuz! Djuz!pg!Nbqmfxppe-!Sbntfz!Dpvouz-! Njooftpub! NPEJGJDBUJPO!UP!UIF!! EFWFMPQNFOU!EJTUSJDU!QSPHSBN!! Efwfmpqnfou!Ejtusjdu!Op/!2! '! Uby!Jodsfnfou!Gjobodjoh!)UJG*!Qmbo! Ftubcmjtinfou!pg!Uby!Jodsfnfou!Gjobodjoh!Ejtusjdu!Op/!2.28! )b!sfefwfmpqnfou!ejtusjdu*! Qsfqbsfe!cz;! Fimfst! 4171!Dfousf!Qpjouf!Esjwf! Sptfwjmmf-!Njooftpub!66224! CVJMEJOH!DPNNVOJUJFT/!JUT!XIBU!XF!EP/! EDA Special Meeting Packet Page Number 44 of 103 G1, Attachment 4 UBCMF!PG!DPOUFOUT! Npejgjdbujpo!up!uif!Efwfmpqnfou!Ejtusjdu!Qsphsbn!gps!Efwfmpqnfou!Ejtusjdu! 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EDA Special Meeting Packet Page Number 45 of 103 G1, Attachment 4 Npejgjdbujpo!up!uif!Efwfmpqnfou!Ejtusjdu!Qsphsbn!gps! Efwfmpqnfou!Ejtusjdu!Op/!2! GPSFXPSE! Uif!gpmmpxjoh!ufyu!sfqsftfout!b!Npejgjdbujpo!up!uif!Efwfmpqnfou!Ejtusjdu! Qsphsbn!gps!Efwfmpqnfou!Ejtusjdu!Op/!2/!Uijt!npejgjdbujpo!sfqsftfout!b! dpoujovbujpo!pg!uif!hpbmt!boe!pckfdujwft!tfu!gpsui!jo!uif!Efwfmpqnfou!Ejtusjdu! Qsphsbn!gps!Efwfmpqnfou!Ejtusjdu!Op/!2/!Hfofsbmmz-!uif!tvctuboujwf!dibohft! jodmvef!uif!ftubcmjtinfou!pg!Uby!Jodsfnfou!Gjobodjoh!Ejtusjdu!Op/!2.28/! Gps!gvsuifs!jogpsnbujpo-!b!sfwjfx!pg!uif!Efwfmpqnfou!Ejtusjdu!Qsphsbn!gps! Efwfmpqnfou!Ejtusjdu!Op/!2-!jt!sfdpnnfoefe/!!Ju!jt!bwbjmbcmf!gspn!uif! Dpnnvojuz!Efwfmpqnfou!Ejsfdups!bu!uif!Djuz!pg!Nbqmfxppe/!!Puifs!sfmfwbou! jogpsnbujpo!jt!dpoubjofe!jo!uif!uby!jodsfnfou!gjobodjoh!qmbot!gps!uif!uby! jodsfnfou!gjobodjoh!ejtusjdut!mpdbufe!xjuijo!Efwfmpqnfou!Ejtusjdu!Op/!2/! Nbqmfxppe!Fdpopnjd!Efwfmpqnfou!Bvuipsjuz! 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EDA Special Meeting Packet Page Number 50 of 103 G1, Attachment 4 Uif!Qspkfdu!Uby!Dbqbdjuz!)QUD*!mjtufe!jt!bo!ftujnbuf!pg!wbmvft!xifo!uif! qspkfdut!xjuijo!uif!Ejtusjdu!bsf!dpnqmfufe/! ! Qspkfdu!Uby!Dbqbdjuz! Qspkfdu!ftujnbufe!Uby!Dbqbdjuz!vqpo!dpnqmfujpo!851,109 Psjhjobm!ftujnbufe!Ofu!Uby!Dbqbdjuz 8,559 Gjtdbm!Ejtqbsjujft 0 Ftujnbufe!Dbquvsfe!Uby!Dbqbdjuz 842,550 Pay 2023 Psjhjobm!Mpdbm!Uby!Sbuf 125.0112% Ftujnbufe!Boovbm!Uby!Jodsfnfou!$1,053,282 Qfsdfou!Sfubjofe!cz!uif!Djuz 100% ! !!!Opuf;!Uby!dbqbdjuz!jodmveft!b!4/11&!jogmbujpo!gbdups!gps!uif!evsbujpo!pg!uif!Ejtusjdu/!Uif!uby! dbqbdjuz!jodmvefe!jo!uijt!dibsu!jt!uif!ftujnbufe!uby!dbqbdjuz!pg!uif!Ejtusjdu!jo!zfbs!37/!Uif!uby! dbqbdjuz!pg!uif!Ejtusjdu!jo!zfbs!pof!jt!ftujnbufe!up!cf!%218-924/! ! Qvstvbou!up!N/T/-!Tfdujpo!57:/288-!Tvce/!5-!uif!FEB!tibmm-!bgufs!b!evf!boe! ejmjhfou!tfbsdi-!bddpnqboz!jut!sfrvftu!gps!dfsujgjdbujpo!up!uif!Dpvouz!Bvejups! ps!jut!opujdf!pg!uif!Ejtusjdu!fombshfnfou!qvstvbou!up!N/T/-!Tfdujpo!57:/286-! 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EDA Special Meeting Packet Page Number 51 of 103 G1, Attachment 4 Uif!dptut!pvumjofe!jo!uif!Vtft!pg!Gvoet!xjmm!cf!gjobodfe!qsjnbsjmz!uispvhi!uif! boovbm!dpmmfdujpo!pg!uby!jodsfnfout/!Uif!FEB!ps!Djuz!sftfswft!uif!sjhiu!up! jttvf!cpoet!)bt!efgjofe!jo!uif!UJG!Bdu*!ps!jodvs!puifs!joefcufeoftt!bt!b!sftvmu! pg!uif!UJG!Qmbo/!Bt!qsftfoumz!qspqptfe-!uif!qspkfdut!xjuijo!uif!Ejtusjdu!xjmm!cf! gjobodfe!cz!qbz.bt.zpv.hp!opuft!boe!!joufsgvoe!mpbot/!Boz!sfgvoejoh!bnpvout! xjmm!cf!effnfe!b!cvehfufe!dptu!xjuipvu!b!gpsnbm!npejgjdbujpo!up!uijt!UJG! Qmbo/!Uijt!qspwjtjpo!epft!opu!pcmjhbuf!uif!FEB!ps!Djuz!up!jodvs!efcu/!Uif!FEB! ps!Djuz!xjmm!jttvf!cpoet!ps!jodvs!puifs!efcu!pomz!vqpo!uif!efufsnjobujpo!uibu! tvdi!bdujpo!jt!jo!uif!cftu!joufsftu!pg!uif!Djuz/!! Uif!FEB!ps!Djuz!nbz!jttvf!cpoet!tfdvsfe!jo!xipmf!ps!jo!qbsu!xjui!uby! jodsfnfout!gspn!uif!Ejtusjdu!jo!b!nbyjnvn!qsjodjqbm!bnpvou!pg!%24-267-:81/! 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VTFT Mboe0Cvjmejoh!Bdrvjtjujpo$ 1,800,000 Tjuf!Jnqspwfnfout0Qsfqbsbujpo 3,200,000 Vujmjujft 1,000,000 Puifs!Rvbmjgzjoh!Jnqspwfnfout 5,281,684 Benjojtusbujwf!Dptut!)vq!up!21&* 1,875,286 QSPKFDU!DPTUT!UPUBM$ 13,156,970 Joufsftu 7,471,171 QSPKFDU!BOE!JOUFSFTU!DPTUT!UPUBM$ 20,628,141 Uif!upubm!qspkfdu!dptu-!jodmvejoh!gjobodjoh!dptut!)joufsftu*!mjtufe!jo!uif!ubcmf! bcpwf!epft!opu!fydffe!uif!upubm!qspkfdufe!uby!jodsfnfout!gps!uif!Ejtusjdu!bt! tipxo!jo!uif!Tpvsdft!pg!Sfwfovf!tfdujpo/! Nbqmfxppe!Fdpopnjd!Efwfmpqnfou!Bvuipsjuz! Uby!Jodsfnfou!Gjobodjoh!Ejtusjdu!Op/!2.28 8! EDA Special Meeting Packet Page Number 52 of 103 G1, Attachment 4 Ftujnbufe!dptut!bttpdjbufe!xjui!uif!Ejtusjdu!bsf!tvckfdu!up!dibohf!bnpoh! dbufhpsjft!xjuipvu!b!npejgjdbujpo!up!uif!UJG!Qmbo/!Uif!dptu!pg!bmm!bdujwjujft!up! cf!dpotjefsfe!gps!uby!jodsfnfou!gjobodjoh!xjmm!opu!fydffe-!xjuipvu!gpsnbm! npejgjdbujpo-!uif!cvehfu!bcpwf!qvstvbou!up!uif!bqqmjdbcmf!tubuvupsz! sfrvjsfnfout/!!Qvstvbou!up!N/T/-!Tfdujpo!57:/2874-!Tvce/!3-!op!npsf!uibo!36&! pg!uif!uby!jodsfnfou!qbje!cz!qspqfsuz!xjuijo!uif!Ejtusjdu!xjmm!cf!tqfou!po! bdujwjujft!sfmbufe!up!efwfmpqnfou!ps!sfefwfmpqnfou!pvutjef!pg!uif!Ejtusjdu!cvu! xjuijo!uif!cpvoebsjft!pg!Efwfmpqnfou!Ejtusjdu!Op/!2-!)jodmvejoh!benjojtusbujwf! dptut-!xijdi!bsf!dpotjefsfe!up!cf!tqfou!pvutjef!pg!uif!Ejtusjdu*!tvckfdu!up!uif! mjnjubujpot!bt!eftdsjcfe!jo!uif!UJG!Qmbo/! GJTDBM!EJTQBSJUJFT!FMFDUJPO! Qvstvbou!up!N/T/-!Tfdujpo!57:/288-!Tvce/!4-!uif!FEB!ps!Djuz!nbz!fmfdu!pof!pg!uxp! nfuipet!up!dbmdvmbuf!gjtdbm!ejtqbsjujft/!! 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EDA Special Meeting Packet Page Number 53 of 103 G1, Attachment 4 Jnqbdu!po!Uby!Sbuft Qbz!3134!Qpufoujbm! Foujuz Fyufotjpo!SbufQfsdfou!pg!UpubmDUDUbyft 44.9009%35.92% 842,550 $ 378,313 Sbntfz!Dpvouz 341,637 40.5480%32.44% 842,550 Djuz!pg!Nbqmfxppe JTE!733!)Opsui!Tu/!Qbvm. 29.8253%23.86% 842,550 251,293 Nbqmfxppe.Pblebmf* 82,039 9.7370%7.79% 842,550 Puifs 125.0112%100.00% $ 1,053,282 ! ! Uif!ftujnbuft!mjtufe!bcpwf!ejtqmbz!uif!dbquvsfe!uby!dbqbdjuz!xifo!bmm! dpotusvdujpo!jt!dpnqmfufe/!Uif!uby!sbuf!vtfe!gps!dbmdvmbujpot!jt!uif!Qbz!3134! sbuf/!Uif!upubm!ofu!dbqbdjuz!gps!uif!foujujft!mjtufe!bcpwf!bsf!cbtfe!po!Qbz! 3134!gjhvsft/!Uif!Ejtusjdu!xjmm!cf!dfsujgjfe!voefs!uif!Qbz!3134!sbuft/! ! 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EDA Special Meeting Packet Page Number 54 of 103 G1, Attachment 4 Uif!jnqbdu!pg!uif!Ejtusjdu!po!qvcmjd!jogsbtusvduvsf!jt!fyqfdufe!up!cf! njojnbm/!Uif!efwfmpqnfou!jt!opu!fyqfdufe!up!tjhojgjdboumz!jnqbdu! boz!usbggjd!npwfnfout!jo!uif!bsfb/!Uif!dvssfou!jogsbtusvduvsf!gps! tbojubsz!tfxfs-!tupsn!tfxfs!boe!xbufs!xjmm!cf!bcmf!up!iboemf!uif! beejujpobm!wpmvnf!hfofsbufe!gspn!uif!qspqptfe!efwfmpqnfou/!Cbtfe! po!uif!efwfmpqnfou!qmbot-!uifsf!bsf!op!beejujpobm!dptut!bttpdjbufe! xjui!tusffu!nbjoufobodf-!txffqjoh-!qmpxjoh-!mjhiujoh!boe!tjefxbmlt/!! Uif!qspcbcmf!jnqbdu!pg!uif!jttvbodf!pg!boz!hfofsbm!pcmjhbujpo!uby! jodsfnfou!cpoet!qbzbcmf!gspn!uby!jodsfnfou!sfwfovft!gspn!uif! 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Uby!Jodsfnfou!Gjobodjoh!Ejtusjdu!Op/!2.28 21! EDA Special Meeting Packet Page Number 55 of 103 G1, Attachment 4 TVQQPSUJOH!EPDVNFOUBUJPO! 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Benjojtusbujpo!pg!uif!Ejtusjdu!xjmm!cf!iboemfe!cz!uif!Dpnnvojuz!Efwfmpqnfou! Ejsfdups/! Nbqmfxppe!Fdpopnjd!Efwfmpqnfou!Bvuipsjuz! Uby!Jodsfnfou!Gjobodjoh!Ejtusjdu!Op/!2.28 22! EDA Special Meeting Packet Page Number 56 of 103 G1, Attachment 4 Bqqfoejy!B;!Nbq!pg!Efwfmpqnfou!Ejtusjdu!Op/!2!boe!uif!UJG! Ejtusjdu! !! Nbqmfxppe!Fdpopnjd!Efwfmpqnfou!Bvuipsjuz!! Uby!Jodsfnfou!Gjobodjoh!Ejtusjdu!Op/!2.28! EDA Special Meeting Packet Page Number 57 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 58 of 103 G1, Attachment 4 Bqqfoejy!C;!Ftujnbufe!Dbti!Gmpx!gps!uif!Ejtusjdu! Nbqmfxppe!Fdpopnjd!Efwfmpqnfou!Bvuipsjuz! Uby!Jodsfnfou!Gjobodjoh!Ejtusjdu!Op/!2.28! EDA Special Meeting Packet Page Number 59 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 60 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 61 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 62 of 103 G1, Attachment 4 Bqqfoejy!D;!Gjoejoht!Jodmvejoh!Cvu0Gps!Rvbmjgjdbujpot! 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EDA Special Meeting Packet Page Number 65 of 103 G1, Attachment 4 REPORT OF INSPECTION PROCEDURES AND RESULTS FOR DETERMINING QUALIFICATIONS OF A TAX INCREMENT FINANCING DISTRICT AS A REDEVELOPMENT DISTRICT FROST AVENUE EASTTIF DISTRICT MAPLEWOOD, MINNESOTA March 11,2022Prepared by: LHB, Inc. 701 Washington Avenue North, Suite 200 Prepared for theMinneapolis, Minnesota 55401 CITY OF MAPLEWOOD LHB Project No. 220122 EDA Special Meeting Packet Page Number 66 of 103 G1, Attachment 4 Table of Contents Part 1: Executive Summary......................................................................................................................................2 Purpose of the Evaluation........................................................................................................................................................2 Scope of Work.........................................................................................................................................................................2 Conclusion...............................................................................................................................................................................3 Part 2: Minnesota Statute 469.174, Subdivision 10 Requirements.......................................................................3 Interior Inspection....................................................................................................................................................................3 Exterior Inspection and Other Means......................................................................................................................................3 Documentation.........................................................................................................................................................................3 Qualification Requirements......................................................................................................................................................3 1. Coverage Test....................................................................................................................................................................3 2. Condition of Buildings Test.................................................................................................................................................4 3. Distribution of Substandard Buildings................................................................................................................................. 5 Part 3: Procedures Followed....................................................................................................................................5 Part 4: Findings.........................................................................................................................................................5 1. Coverage Test.....................................................................................................................................................................5 2. Condition of Building Test....................................................................................................................................................6 3. Distribution of Substandard Structures................................................................................................................................8 Part 5: Team Credentials..........................................................................................................................................9 Appendices................................................................................................................................................................9 APPENDIX A Property Condition Assessment Summary Sheet APPENDIX B Building Code, Condition Deficiency and Context Analysis Reports APPENDIX C Building Replacement Cost Reports Code Deficiency Cost Reports Photographs Frost Avenue East TIF District LHB Project No. 220122 Page 1 of 9Final Report EDA Special Meeting Packet Page Number 67 of 103 G1, Attachment 4 Part 1: Executive Summary Purpose of the Evaluation LHB was hired by the City of Maplewood to inspect and evaluate the properties within a Tax Increment Financing Redevelopment District (ÐTIF DistrictÑ) proposed to be established by the City. The proposed TIF District is located at the corner of Frost Avenue East and Phalen Place North (Diagram 1). The purpose of LHBÓs work is to determine whether the proposed TIF District meets the statutory requirements for coverage, and whether one (1) buildingon three (3) parcels and one ROW area, located within the proposed TIF District, meetsthe qualifications required for a Redevelopment District. Diagram 1: Proposed TIF District Scope of Work The proposed TIF District consists of three (3) parcels and one ROW area with one (1) structure and one (1) outbuilding. One (1) building was inspected on February 15, 2022. Building Code and Condition Deficiency reports for the buildings that were inspectedand found substandardare inAppendix B. Frost Avenue East TIF District LHB Project No. 220122 Page 2 of 9Final Report EDA Special Meeting Packet Page Number 68 of 103 G1, Attachment 4 Conclusion After inspecting and evaluating the properties within the proposed TIF District and applying current statutory criteria for a Redevelopment District under Minnesota Statutes, Section 469.174, Subdivision 10, it is our professional opinion that the proposed TIF District qualifies as a Redevelopment District because: The proposed TIF District has a coverage calculation of 100 percent which is above the 70 percent requirement. 100 percent of the buildings are structurally substandard which is above the 50 percent requirement. The substandard buildings are reasonably distributed. The remainder of this report describes our process and findings in detail. Part 2: Minnesota Statute 469.174, Subdivision 10 Requirements The properties were inspected in accordance with the following requirements under Minnesota Statutes, Section 469.174, Subdivision 10(c), which states: Interior Inspection ÐThe municipality may not make such determination \[that the building is structurally substandard\] without an interior inspection of the property...Ñ Exterior Inspection and Other Means ÐAn interior inspection of the property is not required, if the municipality finds that (1)the municipality or authority is unable to gain access to the property after using its best efforts to obtain permission from the party that owns or controls the property; and (2)the evidence otherwise supports a reasonable conclusion that the building is structurally substandard.Ñ Documentation ÐWritten documentation of the findings and reasons why an interior inspection was not conducted must be made and retained under section 469.175, subdivision 3(1).Ñ Qualification Requirements Minnesota Statutes, Section 469.174, Subdivision 10 (a) (1)requires three tests for occupied parcels: 1.COVERAGE TEST a.Minnesota Statutes, Section 469.174, Subdivision 10(a)(1) states: Ðparcels consisting of 70 percent of the area of the district are occupied by buildings, streets, utilities, or paved or gravel parking lotsÈÑ b.The coverage required by the parcel to be considered occupied is defined under Minnesota Statutes, Section 469.174, Subdivision 10(e), which states: ÐFor purposes of this subdivision, a parcel is not occupied by buildings, streets, utilities, paved or gravel parking lots, or other similar structures unless 15 percent of the area of the parcel contains buildings, streets, utilities, paved or gravel parking lots, or other similar structures.Ñ Frost Avenue East TIF District LHB Project No. 220122 Page 3 of 9Final Report EDA Special Meeting Packet Page Number 69 of 103 G1, Attachment 4 2. CONDITION OF BUILDINGS TEST a.Minnesota Statutes, Section 469.174, Subdivision 10(a) states: ÐÈand more than 50 percent of the buildings, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance;Ñ b.Structurally substandard is defined under Minnesota Statutes, Section 469.174, Subdivision 10(b), which states: ÐFor purposes of this subdivision, Òstructurally substandardÓ shall mean containing defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance.Ñ i.We do not count energy code deficiencies toward the thresholds required by Minnesota Statutes, Section 469.174, Subdivision 10(b)defined as Ðstructurally substandardÑ, due to concerns expressed by the State of Minnesota Court of Appeals in the Walser Auto Sales, Inc. vs. City of Richfield case filed November 13, 2001. c.Buildings are not eligible to be considered structurally substandard unless they meet certain additional criteria, as set forth in Subdivision 10(c) which states: ÐA building is not structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the building code at a cost of less than 15 percent of the cost of constructing a new structure of the same square footage and type on the site. The municipality may find that a building is not disqualified as structurally substandard under the preceding sentence on the basis of reasonably available evidence, such as the size, type, and age of the building, the average cost of plumbing, electrical, or structuralrepairs, or other similar reliable evidence.Ñ ÐItems of evidence that support such a conclusion \[that the building is not disqualified\] include recent fire or police inspections, on-site property tax appraisals or housing inspections, exterior evidence ofdeterioration, or other similar reliable evidence.Ñ i.LHB counts energy code deficiencies toward the 15 percent code threshold required by Minnesota Statutes, Section 469.174, Subdivision 10(c)) for the following reasons: 1)The Minnesota energy code is one often building code areas highlighted by the Minnesota Department of Labor and Industry website where minimum construction standards are required by law. 2)Chapter 13 of the 2015 Minnesota Building Code states, ÐBuildings shall be designed and constructed in accordance with the International Energy Conservation Code.Ñ Furthermore, Minnesota Rules, Chapter 1305.0021 Subpart 9 states, ÐReferences to the International Energy Conservation Code in this code mean the Minnesota Energy Code ÈÑ 3)Chapter 11 of the 2015 Minnesota Residential Code incorporates Minnesota Rules, Chapters, 1322 and 1323 Minnesota Energy Code. 4)The Senior Building Code Representative for the Construction Codes and Licensing Division of the Minnesota Department of Labor and Industry confirmed that the Minnesota Energy Code is being enforced throughout the State of Minnesota. 5)In a January 2002 report to the Minnesota Legislature, the Management Analysis Division of the Minnesota Department of Administration confirmed that the construction cost of new buildings complying with the Minnesota Energy Code is higher than buildings built prior to the enactment of the code. 6)Proper TIF analysis requires a comparison between the replacement value of a new building built under current code standards with the repairs that would be necessary to bring the existing building up to current code standards. Foran equal comparison to be made, all applicable code chapters should be applied to both scenarios. Since current construction estimating software automatically applies the construction cost of complying with the Minnesota Energy Code, energy code deficiencies should also be identified in the existing structures. Frost Avenue East TIF District LHB Project No. 220122 Page 4 of 9Final Report EDA Special Meeting Packet Page Number 70 of 103 G1, Attachment 4 3.DISTRIBUTION OF SUBSTANDARD BUILDINGS a.MinnesotaStatutes, Section 469.174, Subdivision 10, defines a Redevelopment District and requires one or more of the following conditionsÐreasonably distributed throughout the district.Ñ: Ð(1) Parcels consisting of 70 percent of the area of the district are occupied by buildings, streets, utilities, paved or gravel parking lots, or other similar structures and more than 50 percent of the buildings, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance; (2)the property consists of vacant, unused, underused, inappropriately used, or infrequently used rail yards, rail storage facilities, or excessive or vacated railroad rights-of-way; (3)tank facilities, or property whose immediately previous use wasfor tank facilitiesÈÑ b.Our interpretation of the distribution requirement is that the substandard buildings must be reasonably distributed throughout the district as compared to the location of all buildings in the district. For example, if all of the buildings in a district are located on one half of the area of the district, with the other half occupied by parking lots (meeting the required 70 percent coverage for the district), we would evaluate the distribution of the substandard buildings compared with only the half of the district where the buildings are located. If allthe buildings in a district are located evenly throughout the entire area of the district, the substandard buildings must be reasonably distributed throughout the entire area of the district. We believe this is consistent with the opinion expressed by the State of Minnesota Court of Appeals in the Walser Auto Sales, Inc. vs. City of Richfield case filed November 13, 2001. Part 3: Procedures Followed LHB inspected one (1) buildingduring the day of February 15, 2022. Barns and outbuildings: For the purposes of our work, we are defining buildings as those structures inhabited by human beings. These structures would typically include water, sewer, and electricity. Barns and small storage facilities are considered ÐoutbuildingsÑ which are not typically considered in TIF analysis because they have very few code requirements and are not intended for human occupation. A small three-sided structure on Parcel D was identified as an ÐoutbuildingÑ and not inspected. Part 4: Findings 1.Coverage Test a.The total square foot area ofthe parcel in the proposed TIF District was obtained from City records, GIS mapping and site verification. b.The total square foot area of buildings and site improvements on the parcels in the proposed TIF District was obtained from City records, GIS mapping and site verification. c.The percentage of coverage for each parcel in the proposed TIF District was computed to determine if the 15 percent minimum requirement was met. The total square footage of parcels meeting the 15 percent requirement was divided into the total square footage of the entire district to determine if the 70 percent requirement was met. Frost Avenue East TIF District LHB Project No. 220122 Page 5 of 9Final Report EDA Special Meeting Packet Page Number 71 of 103 G1, Attachment 4 FINDING The proposed TIF District met the coverage test under Minnesota Statutes, Section 469.174, Subdivision 10(e), which resulted in parcels consisting of 100 percent of the area of the proposed TIF District being occupied by buildings, streets, utilities, paved or gravel parking lots, or other similar structures (Diagram 2). This exceeds the 70 percent area coverage requirement for the proposed TIF District under Minnesota Statutes, Section 469.174, Subdivision (a) (1). Diagram 2 Ï Coverage Diagram Shaded area depicts a parcel more than 15 percent occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures 2.Condition of Building Test a.BUILDING INSPECTION i.The first step in the evaluation process is the building inspection. After an initial walk-thru, the inspector makes a judgment whethera building ÐappearsÑ to have enough defects or deficiencies of sufficient total significance to justify substantial renovation or clearance. If it does, the inspector documents with notes and photographs code and non-code deficiencies in the building. b.REPLACEMENT COST i.The second step in evaluating a building to determine if it is substandard to a degree requiring substantial renovation or clearance is to determine its replacement cost. This is the cost of constructing a new structure of the same square footage and type on site. Replacement costs were researched using R.S. Means Cost Works square foot models for 2022. Frost Avenue East TIF District LHB Project No. 220122 Page 6 of 9Final Report EDA Special Meeting Packet Page Number 72 of 103 G1, Attachment 4 ii.A replacement cost was calculated by first establishing building use (office, retail, residential, etc.), building construction type (wood, concrete, masonry, etc.), and building size to obtain the appropriate median replacement cost, which factors in the costs of construction in Maplewood, Minnesota. iii.Replacement cost includes labor, materials, and the contractorÓs overhead and profit. Replacement costs do not include architectural fees, legal fees or other ÐsoftÑ costs not directly related to construction activities. Replacement cost for each building is tabulated in Appendix A. c.CODE DEFICIENCIES i.The next step in evaluating a building is to determine what code deficiencies exist with respect to such building. Code deficiencies are those conditions for a building which are not in compliance with current building codes applicable to new buildings in the State of Minnesota. ii.Minnesota Statutes, Section 469.174, Subdivision 10(c), specifically provides that a building cannot be considered structurally substandard if its code deficiencies are not at least 15 percent of the replacement cost of the building. As a result, it was necessary to determine the extent of code deficiencies for each building in the proposed TIF District. iii.The evaluation was made by reviewing all available information with respect to such buildings contained in City Building Inspection records and making interior and exterior inspections of the buildings. LHB utilizes the current Minnesota State Building Code as the official code for our evaluations. The Minnesota State Building Code is a series of provisional codes written specifically for Minnesota only requirements, adoption of several international codes, and amendments to the adopted international codes. iv.After identifying the code deficiencies in each building, we used R.S. Means Cost Works 2022; Unit and Assembly Costs to determine the cost of correcting the identified deficiencies. We were then able to compare the correction costs with the replacement cost of each building to determine if the costs for correcting code deficiencies meet the required 15 percent threshold. FINDING One (1) out of one (1) buildings (100 percent) in the proposed TIF District contained code deficiencies exceeding the 15 percent threshold required by Minnesota Statutes, Section 469.174, Subdivision 10(c). Building Code, Condition Deficiency and Context Analysis reports for the buildings in the proposed TIF District can be found in Appendix B of this report. d.SYSTEM CONDITION DEFICIENCIES i.If a building meets the minimum code deficiency threshold under Minnesota Statutes, Section 469.174, Subdivision 10(c), then in order for such building to be Ðstructurally substandardÑ under Minnesota Statutes, Section 469.174, Subdivision 10(b), the buildingÓs defects or deficiencies should be of sufficient total significance to justify Ðsubstantial renovation or clearance.Ñ Based on this definition, LHB re-evaluated each of the buildings that met the code deficiency threshold underMinnesota Statutes, Section 469.174, Subdivision 10(c), to determine if the total deficiencies warranted Ðsubstantial renovation or clearanceÑ based on the criteria we outlined above. ii.System condition deficiencies are a measurement of defects or substantial deterioration in site elements, structure, exterior envelope, mechanical and electrical components, fire protection and emergency systems, interior partitions, ceilings, floors, and doors. iii.The evaluation of system condition deficiencies was made by reviewing all available information contained in City records, and making interior and exterior inspections of the buildings. LHB only identified system condition deficiencies that were visible upon our inspection of the building or contained in City records. We did not consider the amount of Ðservice lifeÑ used up for a particular component unless it was an obvious part of that componentÓs deficiencies. iv.After identifying the system condition deficiencies in each building, we used our professional judgmentto determine if the list of defects or deficiencies is of sufficient total significance to justify Ðsubstantial renovation or clearance.Ñ Frost Avenue East TIF District LHB Project No. 220122 Page 7 of 9Final Report EDA Special Meeting Packet Page Number 73 of 103 G1, Attachment 4 FINDING In our professional opinion, one (1) out of one (1) buildings (100 percent) in the proposed TIF District are structurally substandard to a degree requiring substantial renovation or clearance, because of defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance. This exceeds the 50 percent requirement of Subdivision 10a(1). 3.Distribution of Substandard Structures e.Much of this report has focused on the condition of individual buildings as they relate to requirements identified by Minnesota Statutes, Section 469.174, Subdivision 10. It is also important to lookat the distribution of substandard buildings throughout the geographic area of the proposed TIF District (Diagram 3). FINDING The parcels with substandard buildings are reasonably distributed compared to all parcels that contain buildings. Diagram 3 Ï Substandard Buildings Shaded green area depicts parcels with buildings. Shaded orange area depicts substandard buildings. Frost Avenue East TIF District LHB Project No. 220122 Page 8 of 9Final Report EDA Special Meeting Packet Page Number 74 of 103 G1, Attachment 4 Part 5: Team Credentials Michael A. Fischer, AIA, LEED AP - Project Principal/TIF Analyst Michael has 34 years of experience as project principal, project manager, project designer and project architect on planning, urban design, educational, commercial, and governmental projects. He has become an expert on Tax Increment Finance District analysis assisting over 100 cities with strategic planning for TIF Districts. He is an Architectural Principal at LHB and currently leads the Minneapolis office. Michael completed a two-year Bush Fellowship, studying at MIT and Harvard in 1999, earning masterÓs degrees in City Planning and Real Estate Development from MIT. He has served on more than 50 committees, boards, and community task forces, including a term as a City Council President, Chair of a Metropolitan Planning Organization, and Chair of the Edina Planning Commission. Most recently, he served as a member of the Edina city counciland Secretary of the Edina HRA. Michael has also managed and designed several award-winning architectural projectsand was one of four architects in the Country to receive the AIA Young Architects Citation in 1997. Phil Fisher Ï Inspector For 35 years, Phil Fisher worked in the field of Building Operations in Minnesota including White Bear Lake Area Schools. At the University of Minnesota,he earned his Bachelor of Science in Industrial Technology. He is a Certified Playground Safety Inspector, Certified Plant Engineer, and is trained in Minnesota Enterprise Real Properties (MERP) Facility Condition Assessment (FCA). His FCA training was recently applied to the Minnesota Department of Natural Resources Facilities Condition Assessment project involving over 2,000 buildings. Appendices APPENDIX A Property Condition Assessment Summary Sheet APPENDIX B Building Code, Condition Deficiency and Context Analysis Reports APPENDIX C Building Replacement Cost Reports Code Deficiency Cost Reports Photographs Frost Avenue East TIF District LHB Project No. 220122 Page 9 of 9Final Report EDA Special Meeting Packet Page Number 75 of 103 G1, Attachment 4 APPENDIX A Property Condition Assessment Summary Sheet EDA Special Meeting Packet Page Number 76 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 77 of 103 G1, Attachment 4 APPENDIX B Building Code, Condition Deficiency and Context Analysis Reports EDA Special Meeting Packet Page Number 78 of 103 G1, Attachment 4 Frost Avenue EastRedevelopment TIF District Building Code, Condition Deficiency and Context Analysis Report Parcel B Retail Building Address: 1136 Frost Avenue East, Maplewood, Minnesota 55109 Parcel ID:162922420003 Inspection Date(s) & Time(s):February 15, 2022 Inspection Type:Interior and Exterior Summary of Deficiencies:It is our professional opinion that this building is Substandard because: -Substantial renovation is required to correct Conditions found. -Building Code deficiencies total more than 15% of replacement cost, NOT including energy code deficiencies. Estimated Replacement Cost:$1,738,602 Estimated Cost to Correct Building Code Deficiencies:$435,520 Percentage of Replacement Cost for Building Code Deficiencies:25.1% DEFECTS IN STRUCTURAL ELEMENTS 1.Concrete block and mortar are damaged/missing allowing for water intrusion which is contrary to code. 2.Foundation wall is failing allowing for water intrusion which is contrary to code. 3.Steel support columns are not properly connected to horizontal beams per code. COMBINATION OF DEFICIENCIES 1.Essential Utilities and Facilities a.There is no code required accessible parking. b.There is no code required accessible route into the building. c.There is no code required accessible route to all levels of the building. d.There is no code required accessible restroom. e.There is no code required water fountain. 2.Light and Ventilation a.The lighting system is not code compliant. b.The electrical wiring system is not code compliant. c.The HVAC system is not code compliant. d.Flammable material cabinet is not properly vented per code. 3.Fire Protection/Adequate Egress a.Thresholds do not comply with code for maximum height. b.There is no code required fire caulking in through wall, floor, and ceiling penetrations. Frost Avenue East TIF DistrictPage 1 of 3 Building Report LHB Project No.220122Parcel B Î 1136 Frost Ave E, Maplewood, MN 55109 EDA Special Meeting Packet Page Number 79 of 103 G1, Attachment 4 c.The stairs donot comply with code. d.The emergency exit signage does not comply with code. e.Smoke detectors are not code compliant. f.The emergency lighting system does not comply with code. g.There is no code required emergency notification system. h.There is no code required building sprinkler system. 4.Layout and Condition of Interior Partitions/Materials a.Interior walls and ceilings should be repaired/repainted. 5.Exterior Construction a.Windows are failing allowing for water intrusion which is contrary to code. b.Brick and mortar are failing allowing for water intrusion which is contrary to code. c.Expansion joint caulking is failing allowing for water intrusion which is contrary to code. d.Stucco is cracked/damaged allowing for water intrusion which is contrary to code. e.Roofing material has failed allowing for water intrusion which is contrary to code. DESCRIPTION OF CODE DEFICIENCIES 1.Damaged concrete block and mortar should be repaired/replaced to prevent water intrusion per code. 2.Failing foundation wall should be repaired to prevent water intrusion per code. 3.Steel support columns should be properly fastened to horizontal beams per code. 4.Accessible parking should be created per code. 5.An accessible route into the building should be created per code. 6.An accessible route to all levels should be created per code. 7.A code compliant restroom should be created. 8.Install code required drinking fountain. 9.Code compliant lighting should be installed. 10.Code compliant electrical wiring should be installed. 11.A code compliant HVAC system should be installed. 12.A code required exhaust system for the flammable storage cabinet should be installed. 13.Thresholds should be modified to comply with code for maximum height. 14.Code required firecaulking should be placed in all through wall, floor and ceiling penetrations. 15.The stairs should be modified to comply with code. 16.Code compliant emergency exit signs should be installed. 17.Code compliant smoke detectors should be installed. 18.A code required emergency notification system should be installed. 19.Code compliant emergency lighting should be installed. 20.A code required building sprinkler system should be installed. 21.Failed windows should be replaced to prevent water intrusion per code. 22.Failed brick andmortar should be repaired/replaced to prevent water intrusion per code. 23.Failed expansion joint caulking should be removed/replaced to prevent water intrusion per code. Frost Avenue East TIF DistrictPage 2 of 3 Building Report LHB Project No.220122Parcel B Î 1136 Frost Ave E, Maplewood, MN 55109 EDA Special Meeting Packet Page Number 80 of 103 G1, Attachment 4 24.Failed stucco should be repaired to prevent water intrusion per code. 25.Failed roofing material should be removed/replaced to prevent water intrusion per code. OVERVIEW OF DEFICIENCIES This building was originally a retail space but is now used as a specialty machine shop. There is no code required accessible parking or route into the building. There is no accessible route to all levels of the building. Exterior block and brick are failing allowing for water intrusion which is contrary to code. Windows are failing allowing for water intrusion which is contrary to code. The electrical wiring and lighting systems do not comply with code. The HVAC system does not comply with code. The restroom does not comply with accessibilitycode. Life safety systems are either not installed or do not comply with code. The flammable material cabinet is not vented per code. The roofing material has failed allowing for water intrusion which is contrary to code. The stairs do not comply with code. The foundation wall is failing allowing for water intrusion which is contrary to code. The steel support column is not properly fastened to the horizontal beam per code. ENERGY CODE DEFICIENCIES In addition to the building code deficiencies listed above, the existing building does not comply with the current energy code. These deficiencies are not included in the estimated costs to correct code deficiencies and are not considered in determining whetherthe building is substandard: M:\\22Proj\\220122\\300 Design\\Reports\\1136 Frost Ave Building Report Redevelopment District.docx Frost Avenue East TIF DistrictPage 3 of 3 Building Report LHB Project No.220122Parcel B Î 1136 Frost Ave E, Maplewood, MN 55109 EDA Special Meeting Packet Page Number 81 of 103 G1, Attachment 4 APPENDIX C Building Replacement Cost Reports Code Deficiency Cost Reports Photographs EDA Special Meeting Packet Page Number 82 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 83 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 84 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 85 of 103 G1, Attachment 4 FROST AVENUE EAST REDEVELOPMENT TIF DISTRICT Code Deficiency Cost Report Parcel B - 1136 Frost Avenue East, Maplewood, Minnesota 55109Building Name or Type Parcel ID 162922420003Retail Building Unit Code Related Cost ItemsUnit CostUnitsTotal Quantity Accessibility Items Parking Create code required accessible parking $ EA1100.00$100.00 Accessible Route Create code required accessible route into the building $ Lump1500.00$500.00 Create code required accessible route to all levels of the building $ SF8,00011.88$95,040.00 Restroom Modify restroom to comply with accessibility code $ SF8,0001.45$11,600.00 Drinking Fountain Install code required drinking fountain $ SF8,0000.53$4,240.00 Structural Elements Concrete Block and Mortar Repair/replace damagedexteriorconcrete blockandmortar toprevent water intrusion per code $ SF8,0004,000.000.50$ Repair foundation wall to prevent water intrusion per code $ Lump12,500.002,500.00$ Steel Support Column Properly attach steel column to horizontal beam per code $ Lump1250.00250.00$ Exiting Thresholds Modify thresholds to comply with code for maximum height $ EA4500.00$2,000.00 Stairs Modify stairs to comply with code $ SF8,0001.15$9,200.00 Exit Signs Install code compliant exit signs $ SF8,0000.22$1,760.00 Emergency Lighting Install code compliant emergency exit lighting system $ SF8,0000.35$2,800.00 Fire Protection Fire Caulking Installcoderequired firecaulkingatall through floor,wallandceiling penetrations $ SF8,0000.11$880.00 Smoke Detectors Install code compliant smoke detectors $ SF8,0001.12$8,960.00 Emergency Notification System Install code required emergency notification system $ SF8,0000.49$3,920.00 Building Sprinkler System Install a code required building sprinkler system $ SF8,0006.75$54,000.00 Frost Avenue East TIF DistrictCode Deficiency Cost Report Page 1 of 2 LHB Project No. 220122Parcel B - 1136 Frost Ave E, Maplewood, MN 55109 EDA Special Meeting Packet Page Number 86 of 103 G1, Attachment 4 Unit Code Related Cost ItemsUnit CostUnitsTotal Quantity Exterior Construction Windows Replace failed windows to prevent water intrusion per code $ SF8,0002.98$23,840.00 Brick and Mortar Replace failed face brick and mortar to prevent water intrusion per code $ Lump11,500.00$1,500.00 Expansion Joint Caulking Remove/replace failedexpansion jointcaulking topreventwater intrusion per code $ Lump1350.00$350.00 Stucco Repair damaged stucco to prevent water intrusion per code $ Lump1800.00$800.00 Roof Construction Roofing Material Remove failed roofing material $ SF8,0000.15$1,200.00 Install roofing material to prevent water intrusion per code $ SF8,0004.70$37,600.00 Mechanical- Electrical Mechanical Install code compliant HVAC sytem $ SF8,00010.01$80,080.00 Install code required ventilation system on flammable material cabinet800.00$ Lump1$800.00 Electrical Install code compliant lighting system $ SF8,0009.26$74,080.00 Install code compliant electrical wiring system $ SF8,0001.69$13,520.00 Total Code Improvements435,520$ Energy Code Frost Avenue East TIF DistrictCode Deficiency Cost Report Page 2 of 2 LHB Project No. 220122Parcel B - 1136 Frost Ave E, Maplewood, MN 55109 EDA Special Meeting Packet Page Number 87 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 88 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 89 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 90 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 91 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 92 of 103 G1, Attachment 4 EDA Special Meeting Packet Page Number 93 of 103 G2 MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITYSTAFF REPORT Meeting Date June 26, 2023 REPORT TO: Melinda Coleman, Executive Director REPORT FROM: Michael Martin, AICP, Assistant Community Development Director PRESENTER: Danette Parr, Community Development Director AGENDA ITEM: Support of Affordable Housing Project, JB Vang– Gladstone Village II, 1880 English Street North a.Resolution Supporting Use of Tax Increment Financing b.Letter of Support from EDA President c.Acknowledgment of Receptivity of a Metropolitan Council LCA Funding Award Action Requested: Motion Discussion Public Hearing Form of Action: Resolution OrdinanceContract/Agreement Proclamation Policy Issue: Earlier this spring, the city council approved JB Vang’s Gladstone Village, a 65-unit affordable multifamily apartment project located at 1310 Frost Avenue. JB Vang has started to work on a second phase of the project which would be a 56-unit new construction mixed-income affordable rental housing development targeting families, located at 1880 English Street North – directly to the south of the approved project. JB Vang is pursuing funding via Housing Tax Credits from the Minnesota Housing Finance Agency to support this second-phase project. As part of the Minnesota Housing Finance Agency’s application process, a resolution of support for the use of tax increment financing and a letter from the President of the Economic Development Authority (EDA) is required to be submitted. This funding source also includes dollars from the Metropolitan Council. The Metropolitan Council can only provide funding to other units of government. Because of this, the EDA is required to submit a form committing that any funding awarded to this project will be made available to the developer. The EDA is being asked to approve a resolution supporting the use of tax increment financing, a letter of support from the EDA President, and the Acknowledgment of Receptivity of a Metropolitan Council LCA Funding Award form. Recommended Action: a.Motion to approve the Resolution of Support for the JB Vang Partners project at 1880 English Street North. b.Motion to approve the EDA President’s Letter of Support for the JB Vang Partners project at 1880 English Street North. c.Motion to approve the Acknowledgement of Receptivity of the Metropolitan Council LCA Funding Award for the JB Vang Partners project at 1880 English Street North. EDA Special Meeting Packet Page Number 94 of 103 G2 Fiscal Impact: Is There a Fiscal Impact? No Yes, the true or estimated cost is $0 Financing source(s): Adopted Budget Budget Modification New Revenue Source Use of Reserves Other: This action is only signifying support of the potential project. The financial impacts of these projects will be analyzed and considered by the City Council at a later date. Strategic Plan Relevance: Community InclusivenessFinancial & Asset MgmtEnvironmental Stewardship Integrated CommunicationOperational EffectivenessTargeted Redevelopment The city’s 2040 Comprehensive Plan establishes the goal to “Improve the availability of affordable housing for both homeowners and renters” and identified an action item to “Partner with Metropolitan Council and other agencies and programs to provide funding assistance (to developers, and also to those in need of housing) to provide for affordable housing units in the community.” Background: JB Vang proposes Gladstone Village II, a 56-unit new construction mixed-income affordable rental housing development targeting families. This development will provide one-, two-, three-, and four- bedroom units at a range of incomes. Gladstone Village II would work to address the need for additional affordable housing in Maplewood directly. The addition of 56 new affordable housing units, all set at 30 percent, 50 percent, and 60 percent area median income, will increase the options for the residents of Maplewood. The development is proposed to start in 2024 and will cost approximately $21.9 million. This property is guided by the city’s 2040 Comprehensive Plan as Mixed Used Neighborhood High Density which encourages multi-family residential uses. JB Vang has identified a funding gap in their proposed projects – which is common for affordable housing developments – and is working to secure funding via Housing Tax Credits from the Minnesota Housing Finance Agency. They have also indicated that they would request tax increment financing from the city. See the attached memo from Ehler’s – the city’s financial consultant – on the requested tax increment financing amounts. Staff wants to emphasize that approval of the attached resolution, letter, and Metropolitan Council form does not bind the city or EDA to any financial agreement. All projects are mandated to submit the required financial and land use applications, which would then go through a full public review process. This will include negotiating the appropriate level of public funding if any, the EDA deems necessary to contribute to the project. Attachments: 1.Location Map 2.Ehlers Memo 3.Resolution Supporting Use of Tax Increment Financing 4.Letter of Support from EDA President 5.Acknowledgment of Receptivity of a Metropolitan Council LCA Funding Award EDA Special Meeting Packet Page Number 95 of 103 G2, Attachment 1 1880 English Street North June 20, 2023 City of Maplewood Legend ! I 0240 Feet Source: City of Maplewood, Ramsey County EDA Special Meeting Packet Page Number 96 of 103 G2, Attachment 2 NFNPSBOEVN! UP;!Ebofuuf!Qbss!!Dpnnvojuz!Efwfmpqnfou!Ejsfdups! 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Efwfmpqnfou!po!bo!boovbm!cbtjt/!!Uif!jodpnft!boe!sfout!mjtufe!cfmpx!bsf!gps!3134!xjui!sfou! sfqsftfoujoh!uif!nbyjnvn!hsptt!bnpvou!uibu!nbz!cf!dibshfe!jodmvejoh!vujmjujft/!!! Njooftpub!Ipvtjoh!boovbmmz!sfwjfxt!bqqmjdbujpot!uispvhi!b!dpnqfujujwf!tdpsjoh!qspdftt!boe! bqqmjdbout!nvtu!nffu!dfsubjo!qsjpsjujft!boe!sfrvjsfnfout!ftubcmjtife!gps!uif!MJIUD!qsphsbn/!!Jo! uif!dbqjubm!dpousjcvujpo!tfdujpo!pg!uif!bqqmjdbujpo-!qspkfdut!dbo!cfofgju!gspn!efnpotusbujoh!b! qbsuofstijq!xjui!b!mpdbm!voju!pg!hpwfsonfou/!!Cbtfe!po!dvssfou!qbsbnfufst-!uif!KC!Wboh!qspkfdu! EDA Special Meeting Packet Page Number 97 of 103 G2, Attachment 2 xjmm!tdpsf!npsf!qpjout!jo!uijt!tfdujpo!xjui!UJG!bttjtubodf!gspn!uif!Djuz!boe!jodsfbtf!uifjs!mjlfmjippe! pg!sfdfjwjoh!uby!dsfejut/!Jg!b!mpdbm!voju!pg!hpwfsonfou!fmfdut!up!tvqqpsu!b!qspkfdu!gjobodjbmmz-!b! sftpmvujpo!pg!gjobodjbm!tvqqpsu!jt!sfrvjsfe!gps!uiftf!qpjout!up!cf!dmbjnfe!jo!uif!tdpsjoh!qspdftt/!! Gjobodjbm!Bttjtubodf!Sfwjfx! 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Ofx!Uby!Sbuft!gps!5e)2*!)blb!bggpsebcmf!ipvtjoh*!Qspkfdut! tu Mfhjtmbujpo!tjhofe!joup!mbx!jo!3134!mpxfst!uif!qspqfsuz!uby!dmbtt!sbuf!gspn!1/86&!po!uif!2! %211-111!pg!qfs.voju!wbmvf!boe!1/36&!qfs.voju!wbmvf!bcpwf!%211-111!tqmju-!up!b!gmbu!1/36&!po!uif! pwfsbmm!qfs.voju!nbslfu!wbmvf!gps!bggpsebcmf!ipvtjoh!qspkfdut/!!Uif!sftvmu!pg!uijt!dibohf;!)b*! jodsfbtft!uif!ofu!pqfsbujoh!jodpnf!gps!uif!qspkfdu!xijdi!dbo!tvqqpsu!b!ijhifs!usbejujpobm! npsuhbhf!bnpvou<!boe!)c*!sfevdft!qspqfsuz!ubyft!boe!UJG!cz!bqqspyjnbufmz!61&/!!Voefs!uif!ofx! uby!sbuft-!uijt!qspkfdu!jt!ftujnbufe!up!hfofsbuf!%22-181!boovbmmz!jo!djuz!qspqfsuz!ubyft!)%49-347!jo! pwfsbmm!ubyft*-!ps!%2:9!qfs!voju!qfs!zfbs!gps!djuz!ubyft/!!!!!!! Sfdpnnfoebujpo;! Cbtfe!po!pvs!sfwjfx!pg!uif!jogpsnbujpo!dvssfoumz!bwbjmbcmf-!xfwf!dpodmvefe!uibu!uif!efwfmpqnfou! xpvme!opu!sfbtpobcmz!cf!fyqfdufe!up!qspdffe!xjuipvu!%438-976!pg!UJG!bttjtubodf/!!Uif!bttjtubodf! dpvme!cf!jo!uif!gpsn!pg!UJG!pwfs!37!zfbst-!ps!uispvhi!bo!vq.gspou!dbti!hsbou!ps!qppmfe!UJG!)jg! bwbjmbcmf*/!!! Qmfbtf!dpoubdu!Tdibof!Svemboh!ps!Kbtpo!Bbstwpme!bu!762.7:8.9611!xjui!boz!rvftujpot/! EDA Special Meeting Packet Page Number 98 of 103 G2, Attachment 3 THE MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF MAPLEWOOD RESOLUTION NO. SUPPORTING USE OF TAX INCREMENT FINANCING FOR A RENTAL HOUSING DEVELOPMENT PROJECT WHEREAS, the Maplewood Economic Development Authority (the “EDA”) was created pursuant to the Economic Development Authorities Act, Minnesota Statutes, Sections 469.090 to 469.1080 (the “EDA Act”), and is authorized pursuant to Minnesota Statutes §469.174 to §469.1794 (the “TIF Act”) to use Tax Increment Financing to carry out the public purposes described herein; WHEREAS, the EDA has received a request to provide tax increment financing assistance to JB Vang Partners (or an affiliated entity, the “Developer”) for construction of a 56-unit multifamily workforce rental housing apartment (the “Project”) to be located on approximately 1.16 acres of land at 1880 English Street in Maplewood, Minnesota; and WHEREAS, in connection with its application to Minnesota Housing for tax credits for the Project, the Developer has requested that the EDA indicate its support of the use of tax increment financing for the Project. NOW, THEREFORE, BE IT RESOLVED, by the Board of Commissioners of the Maplewood Economic Development Authority (the “Board”) as follows: The EDA supports the use of tax increment financing for the Project in an amount not to exceed $327,000 payable over approximately 26 years; provided, however, that authorization of tax increment financing for the Project is solely within the discretion of the City Council after satisfaction of all conditions required pursuant to the EDA Act and the TIF Act, including without limitation, (i) a public hearing; (ii) determining that tax increment financing assistance is necessary for the Project; and (iii) verification of development financing need that substantiates that “but for” the use of tax increment financing the Project would be unable to proceed. The foregoing resolution was introduced by Commissioner ____ and duly seconded by Commissioner ___ . The following Commissioners voted in favor of the resolution: _______. The following Commissioners voted against the resolution: _______. The following Commissioners were absent: _______. Whereupon the resolution was adopted. ADOPTED: June 26, 2023 President Executive Director EDA Special Meeting Packet Page Number 99 of 103 G2, Attachment 4 June 26, 2023 Minnesota Housing Finance Agency 400 Wabasha Street North, Suite 400 Saint Paul, MN 55102 RE: Letter of Support for JB Vang Partners The Maplewood Economic Development Authority supports JB Vang Partners’ application for Minnesota Housing Tax Credits to construct a 56-unit apartment building for affordable housing. The City intends to process an application for a Tax Increment Financing district supporting the Project, including a 26-year TIF Note of up to $327,000 in principal to address a funding gap. Housing is an integral component of our City’s landscape. It is important to the Maplewood Economic Development Authority that a range of housing options be available to meet the needs of individuals and families throughout their lives, such as single-family detached homes, townhomes, condominiums, apartments and senior housing. An important component in providing that cross- section of housing options is the availability of affordable housing. This includes consideration of the cost of housing relative to the wages of those working in and around Maplewood. The cost and availability of housing, specifically rental, is an increasing concern throughout the Metropolitan region, including here in Maplewood. The lack of and rising housing costs is negatively impacting our local businesses, both new and existing. Local business leaders have identified a lack of rental and affordable housing and indicate that such housing benefits the City, their ability to attract and retain employees, and those employees themselves. With the substantial employment increase, Maplewood has already experienced and will continue to experience, affordable housing for workers is an important priority for the City. As JB Vang Partners moves through the city’s formal TIF approval process and determines the final amount of assistance, the project will be required to complete the required public hearings and meet all state guidelines for TIF, including the “but for test”. The Maplewood Economic Development Authority believes JB Vang Partners’ project is an excellent opportunity to help meet some of the housing needs in our community that are currently underserved. In turn, we need development partners such as Minnesota Housing to assist us with our business and community housing needs. We encourage you to fund this needed project for our community. Sincerely, Marylee Abrams President of the Maplewood Economic Development Authority EDA Special Meeting Packet Page Number 100 of 103 G2, Attachment 5 ACKNOWLEDGEMENTOFRECEPTIVITY LCAFUNDINGAWARD The City of Maplewood(city/township,county,developmentauthorityactingas"Grantee”) certifies that the housing development(s), for which the application is submitted, is located in a municipality that participates in the Metropolitan Council’s Livable Communities Local Housing Incentives Account (LHIA) program. Additionally,LHIAawardsmustbematchedon a dollar-for-dollarbasiswith a sourceoffundingthatis either directly from, or is designated by, the participating city or development authority as required by state statute (MN Statutes section 473.254, subdivision 6); sources include (but are not limited to) Community Development Block Grants , HOME Investment Partnerships Program (HOME), Tax IncrementFinancing(TIF),HOMEAmericanRecuePlanProgram(ARP),HousingTrustFunddollars, tax abatements, local housing revenue bonds, and the appraised value of donated land. TheGranteeagreestoacceptandmakeavailablein a timelymanner,anyLCAawardtothecity, county, or development authority to assist the housing program or activity proposed in this application,if such anawardismade,andtoprovidematchingfundsasrequiredbystatestatute. Proposed Project Information Requiredforgrantcontractingpurposes ProjectName:Gladstone Village II ProjectAddressorLocation:1880 English Street, Maplewood, MN 55109 DeveloperName:JB Vang Partners Local MatchSource Pleasedescribetheproposedsourceofmatchingfundsbelow.If a source isnotyetidentified,please tell us the date, no later than December 1 of this year, by which this determination will be made. Gladstone Village II has committed HOME and ARPA sourcesfrom Ramsey County, as well as st an anticipated commitment of TIF, expected no later than December 1, 2023. These sources are eligible match sources for LHIA funds: Ramsey County ARPA Funding2023 Award: $2,748,031 City of Maplewood TIF: Exact determination will be made prior to st December 12023 Contact Information NameofApplicant(PrimaryProjectContact):Jackson Cruikshank Position Title: Development Manager Phone Number: 763-568-0593 EDA Special Meeting Packet Page Number 101 of 103 G2, Attachment 5 Address: 1335 Pierce Butler Route City: St. Paul Phone Number: 763-568-0593 Email: JCruikshank@JBVang.com Contact Information Name of Grantee (Legal name for contract): Primary Contact Name: Position Title: Phone Number: E-mail: Name of Authorized Official on behalf of Grantee: Position Title: Phone Number: E-mail: Authorized Official Signature: Date: EDA Special Meeting Packet Page Number 102 of 103 G3 MAPLEWOOD ECONOMIC DEVELOPMENT AUTHORITY STAFF REPORT Meeting Date June 26, 2023 REPORT TO: Melinda Coleman, City Manager REPORT FROM: Danette Parr, Assistant Executive Director PRESENTER:Danette Parr, Assistant Executive Director AGENDA ITEM: Cancellation of the July 10, 2023 EDA Meeting Action Requested: MotionDiscussion Public Hearing Form of Action: Resolution OrdinanceContract/Agreement Proclamation Policy Issue: At the end of 2022, the Economic Development Authority (EDA) established its regular meeting schedule for 2023, which generally meets quarterly. The EDA has the ability to cancel or add meetings as needed as agenda items arise. Recommended Action: Motion to cancel the July 10, 2023 EDA Meeting. Fiscal Impact: Is There a Fiscal Impact? No Yes, the true or estimated cost is $0.00 Financing source(s): Adopted Budget Budget Modification New Revenue Source Use of Reserves Other: N/A Strategic Plan Relevance: Community InclusivenessFinancial & Asset MgmtEnvironmental Stewardship Integrated CommunicationOperational EffectivenessTargeted Redevelopment N/A Background: Currently, staff does not have any time-sensitive matters that would call for the need for the EDA to meet on July 10, 2023. The next regularly scheduled EDA meeting is Monday, September 11, 2023. Attachments: None EDA Special Meeting Packet Page Number 103 of 103