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06/04/2002 - City Council SpecialAGENDA SPECIAL EAGAN CITY COUNCIL MEETING TUESDAY, JUNE 4, 2002 4:30 P.M. CITY COUNCIL CHAMBERS I. ROLL CALL AND AGENDA ADOPTION II. VISITORS TO BE HEARD III. DISCUSSION REGARDING PRELIMINARY REDEVELOPMENT AGREEMENTS FOR: • Amcon Construction • Interstate Partners • United Properties IV. DISCUSSION REGARDING COMMUNITY CENTER OPERATIONS V. 2001 COMPREHENSIVE ANNUAL FINANCIAL REPORT VI. OTHER BUSINESS VII. ADJOURNMENT VIII. ECONOMIC DEVELOPMENT AUTHORITY A. Approve Agenda B. Approve Minutes C. Consider Preliminary Redevelopment Agreement -Amcon Construction D. Consider Preliminary Redevelopment Agreement -Interstate Partners E. Consider Preliminary Redevelopment Agreement -United Properties IX. ADJOURNMENT .~. t~ ~ 3.a ' _ city of eagan MEMO TO: HONORABLE MAYOR AND CITY COUNCILMEMBERS FROM: CITY ADMINISTRATOR HEDGES DATE: MAY 31, 2002 SUBJECT: SPECIAL CITY COUNCIL MEETING /TUESDAY, JUNE 4 A Special City Council meeting was scheduled for the main purpose of reviewing preliminary development agreements for Amcon Construction, Interstate Construction and United Properties. There are two (2) additional items scheduled for the Special City Council meeting; 1.) discussion regarding Community Center operations which will be deferred to the Community Center Operations Committee and, therefore, there will be no discussion on this item at the Special City Council meeting and 2.) the Comprehensive Annual Financial Report, which will receive a brief presentation by the auditors, with the ratification scheduled at the regular meeting on June 4. The only other business is to adjourn as a Special City Council and reconvene as Economic Development Authority to act on the same agreements discussed at the Special City Council meeting. The City Administrator and Mayor have discussed the agenda and feel there should be time to adjourn by approximately 5:30 to 5:40 p.m., enjoy a sandwich in the Municipal Center lunchroom before the Listening Session begins at 6:00 p.m. in the Community Room. DISCUSSION REGARDING PRELIMINARY REDEVELOPMENT AGREEMENTS At its meeting on May 14, the City Council directed staff and consultants to prepare several preliminary redevelopment agreements for consideration. Three agreements have been drafted; two within the Cedar Grove Redevelopment Area and one in the Highway 55 TIF District (TIF District No. 2-4). AMCON Construction is proposing to construct approximately 25,000 square feet of retail at the east gateway intersection of Silver Bell Road and Cedar Grove Parkway (formerly Beau D' Rue Drive) in the Cedar Grove Redevelopment Area (CGRA). The parcels under consideration include those commercial properties previously acquired for Project 800 and that currently occupied by All-America Recreation (formerly Splatball and Country Club). Project management consultant Jim Prosser of Ehlers & Associates eviewed this proposal with the Council on May 14. The subject area is shown in the map on page ~. Interstate Partners is proposing to construct two 40,000 square foot office buildings and three retail pads at the northwest corner of Highway 149 and Highway 55. The properties included in the proposal are within TIF District No. 2-4. Interstate Partners is in the process of completing the Grand Oaks Business Park in this area. The proposal is viewed as an extension of that business park development, both in terms of the character of the development and in its intention to provide service retail for the business park and commercial area in the vicinity. This pro sal was also previewed at the May 14 meeting. The subject area is shown in the map on page ~. United Properties is proposing to construct up to 255,000 square feet of Class A office in the CGRA North District, in the northeast quadrant of the Highway 77 and Highway 13 interchange. The original target for this area was up to 400,000 square feet, however subsequent traffic analysis has identified limitations that require less density in development. United Properties has expressed interest in the subject azea, shown in the map attached on page ~, since the initial round of developer solicitations. Staff and consultants have been working with United over the past months and although the proposal has not been before the Council recently, it does not materially differ from that originally reviewed. The preliminary development agreements do not commit the City financially to the proposals. The agreements essentially grant a period of exclusivity for the staff and consultants to work with the respective developers for further financial and market analysis, and to negotiate details for a final development agreement. The agreements will be considered by the Economic Development Authority. Drafts of the agreements aze attached to the EDA information in the June 4 EDA agenda packet, scheduled to immediately follow this City Council meeting. As a final note, the City Council had directed that final agreements be prepazed for consideration on June 4 between the City and Ryan Companies in the Cedar Grove Redevelopment Area, and between the City and McGough Development in TIF 2-4. Ryan is still reviewing its pro forma and evaluating its project financing. Final details of the McGough agreement aze being drafted. DIRECTION TO BE CONSIDERED: This item is information only. DISCUSSION REGARDING COMMUNITY CENTER OPERATIONS There aze a number of issues concerning the Community Center operations that will require public policy direction by the City Council. In keeping with the format to utilize a City Council appointed committee, the Community Center(Central Park Operations Committee consisting of Councilmembers Bakken and Carlson will schedule a meeting for the purpose of reviewing the Community Center operations and prepaze findings for consideration by the City Council. To proceed ahead with staffing the General Manager position for the Community Center will be on the agenda for consideration on Tuesday, which is a similar action to staffmg considerations the City made in advance of both the Civic Arena and Cascade Bay openings. It was necessary to hire the managers for both of those facilities well in advance of the opening to help with operations, final construction details and staffing. This is very much the case with the Community Center General Manager position, which is listed as a Consent item under Personnel for action at the June 4 meeting. Originally this item was scheduled for the Special City Council meeting and published in the newspaper, however, since the publication, it was determined that the Community Center operations issues should first be reviewed by the Committee and then presented to the City Council for consideration. a DIRECTION TO BE CONSIDERED: To continue any discussion regazding Community Center operations until the Conununity Center Operations Committee presents their findings to the City Council. 2001 COMPREHENSIVE ANNUAL FINANCIAL REPORT The certified public accounting firm of Kern, DeWenter and Viere, Ltd. has completed the auditing of the City's financial records and the prepazation of the 2001 Comprehensive Annual Financial Report. Staff has met with representatives of the accounting firm to review the report as well as the management letter related to the audit. Representatives of the accounting firm will make a presentation to the City Council at the Special City Council Work Session. The auditors and staff will be available to answer any questions that the City Council may have regazding the financial transactions or financial position of the City. Formal acceptance of the report is scheduled for the regular City Council meeting of June 4, 2002. Upon City Council action accepting the report it will be distributed as required bylaw as well as made available for public review. The report and management letter aze being distributed with the regular City Council Agenda packet. DIRECTION TO BE CONSIDERED: The report and management letter are being presented at the Special City Council Work Session for review and discussion. Formal action accepting the report is scheduled for the regular City Council meeting. OTHER BUSINESS ADJOURNMENT The City Council will adjourn the Special City Council meeting and convene as Economic Development Authority to ratify their own recommendations for preliminary redevelopment agreements for Amcon, Interstate Partners and United Properties. /s/ Thomas L. Hedges City Administrator 3 -~a e ~L- ~~ `~ ~, I ~~ ~~ p'~;:~\ ~ V ~y F~ a '~ ~~~~ ~t _ v. ,~ . ~ e e ~• .. ~~ f, . ~~~ .:~= ~ ~ / n a Z~ :~ .- `F f ® /~ ~ ~ ~ ~ ~: W ~-. ~~ y~, V R ~? ~ '~ ~" ~ G ~ ~' e t ~' ~ G4 ~` e ~ ~ ~~ > ~~ , ~ ~ ~m~~ . ~~ ®.~ ~ m~ ®~ ~ CYyyJ ~ ~ O '\t ~m'ina .\ ~ _. ~~ ~~` C~\\~41h ®s a~ .. t" ~ ~ ~0• V E a E ~- ~ Q ~, c m E a ~~~ o ~' m ~~~ ~ _~ \~ E a °~ , ~~ .., i ~ ® iT I~ I~~I°~I ®1 ~`^ ~~ a a~ a . ° a~i Q z --~~ ~-+ _ ._ t - .~ - ~ s /`^'j/ LL _, ~ ~ _- -- ~ ~ ~~ ~ q o 4 m ~ ~ a m~ ~ U _ L.. ® LL ~~ ~. l0 (Q Fmu>a r- ~ E. ~~ ~ .~' i~ ~ ~~ ~ E= ~ ~ a d ;- ~ ~ `_' - ~ ~'~. :~ ~ a ~~ ~r~ r~ ~ ~.~' +~+ ,..- . ~.~\ ~~ d j/ ~ 'j' S _ C >,4 ~ ~ 4, Y~ ~1 Q .. ~ r.. ,_ "~ 'hd • G. o ~~.~ d • ~ ~ e ~' ~ ~ 4S Q ^ ~ ~ ~ - ~ ~ ~ 7 ~ ~ ~ ~ ~ o 'C p ~ u6 B ~' ~ ~` ~ ~ ~ d ~ ~ ~ ~ _ ® ~ e ! ~ ~ .~ d L ~: a ~~ _ 5 Q Z-~~ ~., _ ._ ~ ~ ~~ ~ r O rs s ~ ,r ~~ ~„ ,- r QQ ~V/ ~ - ,~~ ~ ,. ~ N r Q ~ ~ '~ f ~.1 ~ "l `ls ef"' O ® ~ :, ` /~ ~ '~',~ tee ~ ~ m . f ~~1 ~ ~ ~ o ©~€ ~ ~ ~ • ~~ ~ pp g -r-i ~ ~ ~ '~ ~' ~ EG °' `~ ss ` 9 11~~ t. C _ 3 (11( •; ~~ t3Q ~ \ ~ m' in a ~ Y~ ~~..,. (Vi ~,~ ~ o r, b ~ ~~ ~ ~~` ~ "~" ~ d ° '~~ ~ m` ~ ~ ~ ® ~ ~ ~ .~ ® ~ ~ O ~ ,~ ~ 'C . ~ ~ ~ M ~' s C . ~ ~ ~ ~ ~ ~ ' +~ • c • N L ~ ~ Q a~ ~' ~ L \~ a a r ~-~, o ±3 ,~, ~ ~ ~~ ._ L a m AGENDA CITY OF EAGAN ECONOMIC DEVELOPMENT AUTHORITY EAGAN MUNICIPAL CENTER June 4, 2002 Immediately following the City Council Special Meeting scheduled to begin at 4:30 p.m. A. CALL TO ORDER B. ADOPT AGENDA C. APPROVAL OF MINUTES 1. May 7, 2002 D. NEW BUSINESS 1. Consider Preliminary Redevelopment Agreement - AMCON Construction 2. Consider Preliminary Redevelopment Agreement -Interstate Partners 3. Consider Preliminary Redevelopment Agreement -United Properties E. ADJOURNMENT Agenda Information Memo June 4, 2002 Eagan Economic Development Authority Meeting C. APPROVE MINUTES OF MAY 7, 2002 EAGAN ECONOMIC DEVELOPMENT AUTHORITY ACTION TO BE CONSIDERED: To adopt a resolution approving minutes of the May 7, 2002 EDA meeting. ATTACHMENTS: • Minutes are attached on page • Resolution is attached on pag MINUTES OF. A REGULAR MEETING OF THE EAGAN ECONOMIC DEVELOPMENT AUTHORITY Eagan, Minnesota May 7, 2001 A meeting of the Eagan Economic Development Authority was held on Tuesday, May 7, 2002 at 9:50 p.m. at the Eagan Municipal Center. Present were President Awada and Commissioners Carlson, Fields, Tilley and Bakken. Also present were Executive Director Tom Hedges, Senior Planner Mike Ridley, Director of Public Works Tom Colbert, City Attorney Mike Dougherty and Administrative Secretary/Deputy Clerk Mira McGarvey. ADOPT AGENDA Commissioner Carlson moved, Commissioner Tilley seconded a motion to approve the agenda as presented. Aye: 4 Nay: 0 APPROVAL OF MINUTES Commissioner Carlson moved, Commissioner Tilley seconded a motion to approve the minutes of the March 4, 2002 Economic Development Authority meeting. Aye: 4 Nay: 0 ADJOURNMENT The meeting was adjourned at 9:52. p.m. Date Executive Director If you need these minutes in an alternative form such as large print, Braille, audio tape, etc., please contact the City of Eagan, 3830 Pilot Knob Road, Eagan, MN 55122, (651) 681-4600, (TDD phone: (651) 454- 8535). The City of Eagan is corrunitted to the policy that all persons have equal access to its programs, services, activities, facilities and employment without regard to race, color, creed, religion, national origin, sex, disability, age, sexual orientation, marital status or status with regard to public assistance. a EAGAN ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION APPROVING MINUTES OF May 7, 2002 BE IT RESOLVED by the Board of Commissioners of the Eagan Economic Development Authority to approve the minutes of the May 7, 2002 meeting of the Eagan Economic Development Authority. Motion by: Seconded by: Those in Favor: Those Against: Dated: CERTIFICATION I, James Verbrugge, Secretary/Assistant Executive Director of the Economic Development Authority of the City of Eagan, Dakota County, Minnesota, do hereby certify that the foregoing resolution was duly passed and adopted by the Authority in a regular meeting thereof assembled this 4`h day of June, 2002. James Verbrugge, Secretary 3 Agenda Information Memo June 4, 2002 Eagan Economic Development Authority Meeting D. NEW BUSINESS 1. CONSIDER PRELIMINARY REDEVELOPMENT AGREEMENT WITH AMCON CONSTRUCTION ACTION TO BE CONSIDERED: To adopt a resolution approving a Preliminary Redevelopment Agreement with AMCON Construction. FACTS: • The City of Eagan has been studying the possibility of redevelopment in the Cedar Grove Redevelopment Area since 1998. • AMCON Construction has submitted a development proposal for 25,000 square feet of retail development west of the intersection of Silver Bell Road and Cedar Grove Parkway (formerly Beau D' Rue Drive). • The City Council has reviewed the proposal and has requested that a preliminary redevelopment agreement be drafted for consideration by the Economic Development Authority. ATTACHMENT: • Resolution approving the agreement is attached on page. • The preliminary redevelopment agreement is attached on pages ~ through EAGAN ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION TO APPROVE PRELIMINARY REDEVELOPMENT AGREEMENT WITH AMCON CONSTRUCTION BE IT RESOLVED by the Board of Commissioners of the Eagan Economic Development Authority to approve a Preliminary Redevelopment Agreement with AMCON Construction for redevelopment within the Cedar Grove Redevelopment Area. Motion by: Seconded by: Those in Favor: Those Against: Dated: CERTIFICATION I, Jamie Verbrugge, Secretary/Assistant Executive Director of the Economic Development Authority of the City of Eagan, Dakota County, Minnesota, do hereby certify that the foregoing resolution was duly passed and adopted by the Authority in a regular meeting thereof assembled this 4th day of June, 2002. James D. Verbrugge, Secretary S Draft: 5/30/02 PRELIMINARY REDEVELOPMENT AGREEMENT THIS AGREEMENT, made and entered into as of the day of June, 2002, by and between THE EAGAN ECONOMIC DEVELOPMENT AUTHORITY, a Minnesota public body corporate and politic, ("EDA"), and AMCON DEVELOPMENT, ("Redeveloper") BACKGROUND The purpose of this Agreement is to set forth the understanding between the parties with respect to the proposed redevelopment of portions of the area generally described as Cedarvale North Sub Area 3-A("the Redevelopment Property") and shown in Exhibit A. BASIC TERMS AND CONDITIONS The following is a list of the terms and conditions under which the Redeveloper will proceed on an exclusive basis for the term of this agreement to structure and develop with the EDA a definitive Redevelopment Agreement for the Project and is intended to define the responsibilities and roles of the respective participants regarding the proposed redevelopment of the Project. 1. Redevelopment Property. The properties proposed to be redeveloped are the properties set forth in Exhibit A and more fully described in the legal descriptions set forth in Exhibit B hereto ("the Site"). The Site includes five parcels. The exact dimensions and square footage of the Site shall be determined by survey. The parties agree that the Site may be enlarged to include other lands at the mutual agreement of the parties. 2. Undertaking and Exclusive Rights. In consideration of the time, effort and expenses to be incurred by the Redeveloper in pursuing the undertakings set forth herein and in further consideration of the amount of $12,500.00 paid to the EDA, the receipt of which is hereby acknowledged, the EDA hereby agrees that for the term of this agreement it will not: (i) provide or enter into an agreement for provision of financial assistance to any third party in connection with any proposed development within the area covered by this agreement; or (ii) condemn or agree to proceed with the condemnation of any property within such area to assist or facilitate development within such area by a third party. During such period the Redeveloper shall have the exclusive right to make a specific proposal and negotiate the terms of a Redevelopment Agreement for the Redevelopment Property. Said exclusive rights shall continue, unless earlier terminated as provided herein, for a period of eighteen (18) months from the date hereof, or until such later date as the parties may mutually agree; provided, however, that the EDA may terminate this agreement within nine (9) months if the EDA determines that Redeveloper has not aggressively marketed the w property for development. Such determination shall be made at the sole discretion of the EDA and shall not be subject to challenge by the Redeveloper. The above described fee is to be applied to payment of the Redeveloper's obligation contained in Section 10; and any unused portion will be refunded to the Redeveloper upon temunation of this Agreement. The above amount represents the maximum expense that the Redeveloper shall be expected to reimburse the EDA for consultants and staff time under this agreement. The EDA has no obligation hereunder to enter into any Redevelopment Agreement in any form and the Redeveloper acknowledges that the EDA has not made any commitments in that regard. 3. The Project. The Project will consist of the redevelopment of the Site to include an approximately 25,000 square foot retail development. 4. Public Assistance. In order to achieve the foregoing redevelopment, it is anticipated that a definitive Redevelopment Agreement, if any, will contain provisions addressing a variety of forms of public assistance which may be necessary in order to accomplish the redevelopment. No commitment is presently being made to provide any form of public assistance and the Redeveloper acknowledges that the neither the EDA nor the City of Eagan has made any representations that assistance will be available. Examples of public assistance that may ultimately be agreed upon, include, but are not limited to, the following: a. Site Assembly. The EDA will consider acquisition of some or all of the Redevelopment Property based upon terms and conditions contained in the redevelopment contract. Acquisition may be through negotiated purchase, or condemnation or a combination. Acquisition by the EDA shall be considered only after the Redeveloper has demonstrated good faith efforts to purchase the property, and these efforts have been unsuccessful. b. Tax Increment Financing. The EDA has approved a tax increment financing district which includes the Redevelopment Property and agrees to give due consideration to any such request for tax increment assistance for the project. 5. Redeveloper's Proposed Use, Minimum Improvements. Any redevelopment contract will include a description of the minimum improvements to be made by the Redeveloper pursuant to plans which are acceptable to and approved by the EDA as part of the redevelopment contract. 6. Ownershiy. It is expected that any final redevelopment proposal will provide that the Project will be sold by the Redeveloper, or its assignee, to parties acceptable to the City. 7. Contin eg_ncies. It is expected that any redevelopment contract will address the following items, which the parties acknowledge may be material to the Project: 2 a. Determination of the portion of tax increment from the tax increment financing district, if any, which will be made available to the Redeveloper; b. The acquisition of all or part of the Redevelopment Property by direct purchase or condemnation, on such terms and conditions acceptable to the EDA and as determined by the EDA in its sole and absolute discretion. c. Acceptance by the Redeveloper of a Phase I and, if requested, Phase II environmental assessment and all other environmental and wetland reports and surveys certified to the Redeveloper and its lender, deemed necessary by the EDA and the Redeveloper for all of the property located within the Project, which reports and surveys must be satisfactory to the EDA and the Redeveloper; d. The EDA and the Redeveloper have obtained all necessary approvals for the Project from any participating governmental unit, including but not limited to any necessary watershed district; e. All zoning modifications, rezoning approvals and conditional use permits necessary to allow the Project to move forward have been granted; f. The title commitment for the Redevelopment Property shall have been found acceptable to the Redeveloper in its sole discretion; g. Testing results are satisfactory to the Redeveloper including, but not limited to, soils, well, engineering, hazardous waste, and environmental reviews; h. Financing acceptable to the Redeveloper; i. The EDA agreeing to cooperate with the Redeveloper's lender or lenders and agreeing to execute any and all reasonable documents including typical subordination documents with respect to said lenders or any replacement lenders, provided that the EDA may refuse to enter into any such documents if it, in its reasonable discretion determines that to do so would create an unreasonable risk to it, jeopardize any of its security, or make it less likely that the Project would be developed as contemplated. j. Agreement on the number of levels of retail space. 8. Termination. This agreement may be terminated prior to its expiration by the EDA as to all or a portion of the Redevelopment Property upon the giving of written notice to the Redeveloper that the Redeveloper is not diligently pursuing the redevelopment of the portions of the Redevelopment Property. The Redeveloper shall have a reasonable time, but in no event less than 30 days to affect a cure of such 3 default, or to demonstrate that it is diligently pursuing such cure. The EDA may also terminate this agreement for the failure of the Redeveloper to make any payment due in accordance with Paragraph 10 below. 9. Legislative Judg_ ent. The Redeveloper understands that many of the actions which may be necessary for the Project and may be contemplated by a Redevelopment agreement involves matters of the Board of Commissioners' discretion, and in some instances, its legislative judgment. Such actions may only be made following established procedures, and the EDA cannot and does not agree, in advance, to any specific decision in such matters. 10. Consultants to be retained. The EDA intends to retain the services of Faegre & Benson LLP, and Ehlers & Associates, Inc. upon the execution of this agreement. Faegre & Benson is being retained to assist with legal matters pertaining to redevelopment financing. Ehlers & Associates, Inc. is being retained to assist the EDA in the technical matters such as project management, financial feasibility, tax increment procedures and calculations, and other factors pertaining to any claim for economic assistance. The fees and expenses of such consultants will be paid by the EDA for the period up to the execution of a definitive Redevelopment Agreement, and the responsibility for additional costs of such consultants shall be as provided in the Redevelopment Agreement. 11. Notices. All communications shall be directed to the Redeveloper at: Amcon Development All communications shall be directed to the EDA at: Eagan Economic Development Authority City Hall 3830 Pilot Knob Road Eagan, MN 55122-1810 9 IN TESTIMONY WHEREOF, the parties hereto have set their hands as of the date and year first above written. AMCON DEVELOPMENT EAGAN ECONOMIC DEVELOPMENT AUTHORITY By: Its By: Its: Dated M 1:882389.01 5 Dated By: Its: Dated: /~ a E~, ~~ ~ ~~ ~ ~, ~ ~'~ . . ~, ~,, ~~ • ® ~ ~ .o ,, •~, '~ 't. .~~ ~ ~ l' I °I'°( J ~,. a ~~ ~~; ® ~ ~ ~ E 0 s • ~\ J ~~ ~ \\ t r i. n Q Z~-~ ~..~ ._ .s~ / ~ LL ® s © f ~~ ~q W ~ ~ ~ o ~ e o ~' ~ W ..~ ~ ~ ~® a ~. P ~ ® `~ ~ ~~~ ~~ i ^o Q ~~ ~ ~ ~ ~ ~ ~ ~~~ ®~' ~ ~ ` 3~( ~m~ !~. ~\ ~' D ~~ ,s~ ~ ~ 0 V ~ ~ Q C d Q C Q '~ fi •i a City of Eagan, MN Preliminary Redevelopment Agreement - Legat Descriptions AMCON Map tD 1 LotBlk: 000750 19 2 Plat: SECTION 19 TWN 27 RANGE 23 Legal Description: PT OF E 1685.3 FT OF NE 1/4 COM NE COR S 165 FT R 98D 48M 169.59 FT R 45D 10M 135.58 FT TO SE RNV SH #13 NE ON RNV 100 FT TO N LINE SEC E 191 FT TO BEG EX PARCEL 222 OF STATE R11N PLAT NO 19-8 CONT 031100 ACS Map ID 2 LotBlk: 001110 19 2 Plat: SECTION 19 TWN 27 RANGE 23 Legal Description: PT OF NE 114 OF NE 1/4 COM 165 FT S OF NE COR NE 1/4 R 90D 48M 169.59 FT R 45D 10M 95.58 FT TO PT 40 FT SE OF SE R1W SH #13 L 88D 56M PAR TO RNV 200 FT L 91D 04M 195 FT L 88D 56M 202.22 FT R 43D 45M 98.94 FT TO E LINE NE 1/4 N 69.06 FT TO BEG Map ID 4 LotBlk: 001000 19 2 Piat: SECTION 19 TWN 27 RANGE 23 Legal Description: PT OF NE 1/4 COM 609.74 FT S 8 S 38D 27M 22S W 11.31 FT OF NE COR N 44D 36M 10S W 249.80 FT TO PT OF BEGS 47D 52M 26S W 150 FT N 44D 36M 10S W 290.40 FT NE 8 PARR TO SE RNV SH #13150 FT S 44D 36M 10S E 290.40 FT TO PT OF BEG Map ID 3 LotBlk: 001260 19 2 Plat: SECTION 19 TWN 27 RANGE 23 Legal Description: PT OF E 1685.3 FT OF NE 1/4 COM 234.06 FT S OF NE COR R 90D 48M 98.94 FT L 43D 45M 177.22 FT S 47D 52M 26S W 25 FT S 44D 36M 10S E 345.20 FT N 38D 27M 22S E 11.31 FT TO E LINE N 375.68 FT TO BEG Map ID 5 LotBlk: 19 2723 Plat: SECTION 19 TWN 27 RANGE 23 Legal Description: PT OF NE 1/4 COM 609.74 FT S 8 S 38D 27M 22 S W 11.31 FT OF NE COR S 38D 27M 22S W 150.98 FT N 44D 36M 105 W 274.60 FT N 47D 52M 26S E 150 FT S 44D 36M 10S E 249.80 FT TO BEG Noce. Lapel Dssnptkxis ware datainsd from Dakar CwMy Lspal Desaiptwn Dalebass and may na bs the fWl Isyal dss«ipGOn d Me poparty. Exhibit B !a Agenda Information Memo June 4, 2002 Eagan Economic Development Authority Meeting D. NEW BUSINESS 2. CONSIDER PRELIMINARY REDEVELOPMENT AGREEMENT WITH INTERSTATE PARTNERS ACTION TO BE CONSIDERED: To adopt a resolution approving a Preliminary Redevelopment Agreement with Interstate Partners. FACTS: The City of Eagan has pursued redevelopment in the Highway 55 corridor for a number of years. Interstate Partners has expressed interest in redeveloping the northwest corner of the Highway 55 and Highway 149 intersection, within the boundaries of Tax Increment Finance Redevelopment District No. 2-4. The City Council has reviewed the proposal and has requested that a preliminary redevelopment agreement be drafted for consideration by the Economic Development Authority. ATTACHMENT: • Resolution approving the agreement is attached on page. • The preliminary redevelopment agreement is attached on pages~~hrougl~. !3 EAGAN ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION TO APPROVE PRELIMINARY REDEVELOPMENT AGREEMENT WITH INTERSTATE PARTNERS BE IT RESOLVED by the Board of Commissioners of the Eagan Economic Development Authority to approve a Preliminary Redevelopment Agreement with Interstate Partners for redevelopment within TIF District No. 2-4. Motion by: Seconded by: Those in Favor: Those Against: Dated: CERTIFICATION I, Jamie Verbrugge, Secretary/Assistant Executive Director of the Economic Development Authority of the City of Eagan, Dakota County, Minnesota, do hereby certify that the foregoing resolution was duly passed and adopted by the Authority in a regular meeting thereof assembled this 4th day of June, 2002. James D. Verbrugge, Secretary 1~ Draft: 5/30/02 PRELIMINARY REDEVELOPMENT AGREEMENT THIS AGREEMENT, made and entered into as of the day of June, 2002, by and between THE EAGAN ECONOMIC DEVELOPMENT AUTHORITY, a Minnesota public body corporate and politic, ("EDA"), and INTERSTATE PARTNERS, ("Redeveloper") BACKGROUND The purpose of this Agreement is to set forth the understanding between the parties with respect to the proposed redevelopment of portions of the area generally described as the Northwest Corner of Highways 55 and 149 ("the Redevelopment Property") and shown in Exhibit A. BASIC TERMS AND CONDITIONS The following is a list of the terms and conditions under which the Redeveloper will proceed on an exclusive basis for the term of this agreement to structure and develop with the EDA a definitive Redevelopment Agreement for the Project and is intended to define the responsibilities and roles of the respective participants regarding the proposed redevelopment of the Project. 1. Redevelopment Property. The properties proposed to be redeveloped are the properties set forth in Exhibit A and more fully described in the Legal descriptions set forth in Exhibit B hereto ("the Site"). The Site includes five parcels. The exact dimensions and square footage of the Site shall be determined by survey. The parties agree that the Site may be enlarged to include other lands at the mutual agreement of the parties. 2. Undertaking and Exclusive Rights. In consideration of the time, effort and expenses to be incurred by the Redeveloper in pursuing the undertakings set forth herein and in further consideration of the amount of $12,500.00 paid to the EDA, the receipt of which is hereby acknowledged, the EDA hereby agrees that for the term of this agreement it will not: (i) provide or enter into an agreement for provision of financial assistance to any third party in connection with any proposed development within the area covered by this agreement; or (ii) condemn or agree to proceed with the condemnation of any property within such area to assist or facilitate development within such area by a third party. During such period the Redeveloper shall have the exclusive right to make a specific proposal and negotiate the terms of a Redevelopment Agreement for the Redevelopment Property. Said exclusive rights shall continue, unless earlier terminated as provided herein, for a period of eighteen (I 8) months from the date hereof, or until such later date as the parties may mutually agree; provided, however, that the EDA may terminate this agreement within nine (9) /~ months if the EDA determines that Redeveloper has not aggressively marketed the property for development. Such determination shall be made at the sole discretion of the EDA and shall not be subject to challenge by the Redeveloper. The above described fee is to be applied to payment of the Redeveloper's obligation contained in Section 10; and any unused portion will be refunded to the Redeveloper upon termination of this Agreement. The above amount represents the maximum expense that the Redeveloper shall be expected to reimburse the EDA for consultants and staff time under this agreement. The EDA has no obligation hereunder to enter into any Redevelopment Agreement in any form and the Redeveloper acknowledges that the EDA has not made any commitments in that regard. 3. The Proiect. The Project will consist of the redevelopment of the Site to include two approximately 40,000 square foot office buildings and three approximately 7,000 square foot retail/commercial facilities. 4. Public Assistance. In order to achieve the foregoing redevelopment, it is anticipated that a definitive Redevelopment Agreement, if any, will contain provisions addressing a variety of forms of public assistance which may be necessary in order to accomplish the redevelopment. No commitment is presently being made to provide any form of public assistance and the Redeveloper acknowledges that the neither the EDA nor the City of Eagan has made any representations that assistance will be available. Examples of public assistance that may ultimately be agreed upon, include, but are not limited to, the following: a. Site Assembly. The EDA will consider acquisition of some or all of the Redevelopment Property based upon terms and conditions contained in the redevelopment contract. Acquisition may be through negotiated purchase, or condemnation or a combination. Acquisition by the EDA shall be considered only after the Redeveloper has demonstrated good faith efforts to purchase the property, and these efforts have been unsuccessful. b. Tax Increment Financing. The EDA has approved a tax increment financing district which includes the Redevelopment Property and agrees to give due consideration to any such request for tax increment assistance for the project. 5. Redeveloper's Proposed Use, Minimum Improvements. Any redevelopment contract will include a description of the minimum improvements to be made by the Redeveloper pursuant to plans which are acceptable to and approved by the EDA as part of the redevelopment contract. 6. Ownership. It is expected that any final redevelopment proposal will provide that the Project will be sold by the Redeveloper, or its assignee, to parties acceptable to the City. z ~~ 7. Contin eg ncies. It is expected that any redevelopment contract will address the following items, which the parties acknowledge may be material to the Project: a. Determination of the portion of tax increment from the tax increment financing district, if any, which will be made available to the Redeveloper; b. The acquisition of all or part of the Redevelopment Property by direct purchase or condemnation, on such terms and conditions acceptable to the EDA and as deternuned by the EDA in its sole and absolute discretion. c. Acceptance by the Redeveloper of a Phase I and, if requested, Phase II environmental assessment and all other environmental and wetland reports and surveys certified to the Redeveloper and its lender, deemed necessary by the EDA and the Redeveloper for all of the property located within the Project, which reports and surveys must be satisfactory to the EDA and the Redeveloper; d. The EDA and the Redeveloper have obtained all necessary approvals for the Project from any participating governmental unit, including but not limited to any necessary watershed district; e. All zoning modifications, rezoning approvals and conditional use permits necessary to allow the Project to move forward have been granted; f. The title commitment for the Redevelopment Property shall have been found acceptable to the Redeveloper in its sole discretion; g. Testing results are satisfactory to the Redeveloper including, but not limited to, soils, well, engineering, hazardous waste, and environmental reviews; h. Financing acceptable to the Redeveloper; i. The EDA agreeing to cooperate with the Redeveloper's lender or lenders and agreeing to execute any and all reasonable documents including typical subordination documents with respect to said lenders or any replacement lenders, provided that the EDA may refuse to enter into any such documents if it, in its reasonable discretion determines that to do so would create an unreasonable risk to it, jeopardize any of its security, or make it less likely that the Project would be developed as contemplated. 8. Termination. Phis agreement may be terminated prior to its expiration by the EDA as to all or a portion of the Redevelopment Property upon the giving of written notice to the Redeveloper that the Redeveloper is not diligently pursuing the redevelopment of the portions of the Redevelopment Property. The Redeveloper shall have a reasonable time, but in no event less than 30 days to affect a cure of such ' ~7 default, or to demonstrate that it is diligently pursuing such cure. The EDA may also terminate this agreement for the failure of the Redeveloper to make any payment due in accordance with Paragraph 10 below. 9. Legislative Judgment. The Redeveloper understands that many of the actions which may be necessary for the Project and may be contemplated by a Redevelopment agreement involves matters of the Board of Commissioners' discretion, and in some instances, its legislative judgment. Such actions may only be made following established procedures, and the EDA cannot and does not agree, in advance, to any specific decision in such matters. 10. Consultants to be retained. The EDA intends to retain the services of Faegre & Benson LLP, and Ehlers & Associates, Inc. upon the execution of this agreement. Faegre & Benson is being retained to assist with legal matters pertaining to redevelopment financing. Ehlers & Associates, Inc. is being retained to assist the EDA in the technical matters such as project management, financial feasibility, tax increment procedures and calculations, and other factors pertaining to any claim for economic assistance. The fees and expenses of such consultants will be paid by the EDA for the period up to the execution of a definitive Redevelopment Agreement, and the responsibility for additional costs of such consultants shall be as provided in the Redevelopment Agreement. 11. Notices. All communications shall be directed to the Redeveloper at: Interstate Partners All communications shall be directed to the EDA at: Eagan Economic Development Authority City Hal] 3830 Pilot Knob Road Eagan, MN 55122-1810 i~ IN TESTIMONY WHEREOF, the parties hereto have set their hands as of the date and year first above written. INTERSTATE PARTNERS EAGAN ECONOMIC DEVELOPMENT AUTHORITY By: By: Its Its: Dated Dated By: Its: Dated: M1:882392.0] 5 ~y Q Z~~ ._ ~S 3 I~,.yf" , I , 's. H' :Y ~ O .= _ ~~.. I /`~ ~ {V ,, ~ V• ~ mm 5 1 d N d ~ ~~ ~~U~ a ~ F m' v'~i a ~ \ ~ ~~.~ ~f'`f xS V/ ,w J I W ,~,. ~ ~ a `'~J '~ d ~~ ~~ C- ~ 4y 1 ~ ~ m ~, ~ ~ ~' ~ s.~> ~ n~~ ~ C ® ~ . ~ e • d . p ~ a o ^• ® ~ . ~ e ~ ~ ~ r- e d e ^ ~ s ^ ^ o • ® e cv ® ^ C .~ ~ s LiC m ~~o Q .~ ~~~ ~ _ ~ ~. V~C~ City of Eagan, MN Preliminary Redevelopment Agreement -Legal f~esctiptions Interstate Partners Map ID 1 LotBlk: Legal Description: Map ID 2 LotBlk: Legal Description: Map ID 5 1 1 Plat: IMRE ADDITION LOT 1 BLK 1 EX PT HGWY 2 1 Plat: IMRE ADDITION LOT 2 BLK 1 EX PT HGWY LotBlk: 5 Plat: ROBERT O NEILL HOMESTEAD Legal Description: PT OF LOT 5 LYING N OF N R/W TH #55 Map ID 3 LotBlk: 000940 3 Plat: ROBERT O NEILL HOMESTEAD Legal Description: PT COM INT N LINE 8~ W RNV SH #49 S ON R/W 150 FT TO PT OF BEG S ON RNV 160 FT W 245 FT N 158.98 FT E 263.48 FT TO PT OF BEG OF Map ID 4 LotBlk: E Legal Description: OUTLOT Plat: ROBINS ADDITION tide: Lspel Desriptions were dNainsd from Dakota Courky Lspal Dssaiption Datatuiss and may not bathe full lapel dasaiption d t!w ProPMY. Exhibit B a~ Agenda Information Memo June 4, 2002 Eagan Economic Development Authority Meeting D. NEW BUSINESS 3. CONSIDER PRELIMINARY REDEVELOPMENT AGREEMENT WITH UNITED PROPERTIES ACTION TO BE CONSIDERED: To adopt a resolution approving a Preliminary Redevelopment Agreement with United Properties. FACTS: The City of Eagan has been studying the possibility of redevelopment in the Cedar Grove Redevelopment Area since 1998. United Properties submitted a development program during the 2001 developer solicitations for the northeast quadrant of the Highway 77 and Highway 13 interchange. The EDA reviewed that proposal in June 2001. It would be appropriate at this time for the EDA to consider a preliminary redevelopment agreement. ATTACHMENT: • Resolution approving the agreement is attached on pageQ~. • The preliminary redevelopment agreement is attached on pages through EAGAN ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION TO APPROVE PRELIMINARY REDEVELOPMENT AGREEMENT WITH UNITED PROPERTIES BE IT RESOLVED by the Board of Commissioners of the Eagan Economic Development Authority to approve a Preliminary Redevelopment Agreement with United Properties for redevelopment within the Cedar Grove Redevelopment Area. Motion by: Seconded by: Those in Favor: Those Against: Dated: CERTIFICATION I, Jamie Verbrugge, Secretary/Assistant Executive Director of the Economic Development Authority of the City of Eagan, Dakota County, Minnesota, do hereby certify that the foregoing resolution was duly passed and adopted by the Authority in a regular meeting thereof assembled this 4`h day of June, 2002. James D. Verbrugge, Secretary Draft: 5/30/02 PRELIMINARY REDEVELOPMENT AGREEMENT THIS AGREEMENT, made and entered into as of the day of June, 2002, by and between THE EAGAN ECONOMIC DEVELOPMENT AUTHORITY, a Minnesota public body corporate and politic, ("EDA"), and UNITED PROPERTIES, ("Redeveloper") BACKGROUND The purpose of this Agreement is to set forth the understanding between the parties with respect to the proposed redevelopment of portions of the area generally described as Cedar Grove North Sub Area 1-B ("the Redevelopment Property") and shown in Exhibit A. BASIC TERMS AND CONDITIONS The following is a list of the terms and conditions under which the Redeveloper will proceed on an exclusive basis for the term of this agreement to structure and develop with the EDA a definitive Redevelopment Agreement for the Project and is intended to define the responsibilities and roles of the respective participants regarding the proposed redevelopment of the Project. 1. Redevelopment Property. The properties proposed to be redeveloped are the properties set forth in Exhibit A and more fully described in the legal descriptions set forth in Exhibit B hereto ("the Site"). The Site includes three parcels, one of which is owned by the City of Eagan. The exact dimensions and square footage of the Site shall be determined by survey. The parties agree that the Site may be enlarged to include other lands at the mutual agreement of the parties. 2. Undertaking and Exclusive Rights. In consideration of the time, effort and expenses to be incurred by the Redeveloper in pursuing the undertakings set forth herein and in further consideration of the amount of $12,500.00 paid to the EDA, the receipt of which is hereby acknowledged, the EDA hereby agrees that for the term of this agreement it will not: (i) provide or enter into an agreement for provision of financial assistance to any third party in connection with any proposed development within the area covered by this agreement; or (ii) condemn or agree to proceed with the condemnation of any property within such area to assist or facilitate development within such area by a third party. During such period the Redeveloper shall have the exclusive right to make a specific proposal and negotiate the terms of a Redevelopment Agreement for the Redevelopment Property. Said exclusive rights shall continue, unless earlier terminated as provided herein, for a period of eighteen (18) months from the date hereof, or until such later date as the parties may mutually agree; provided, however, that the EDA may terminate this agreement within nine (9) months if the EDA determines that Redeveloper has not aggressively marketed the d'{ property for development. Such determination shall be made at the sole discretion of the EDA and shall not be subject to challenge by the Redeveloper. The above described fee is to be applied to payment of the Redeveloper's obligation contained in Section 10; and any unused portion will be refunded to the Redeveloper upon termination of this Agreement. The above amount represents the maximum expense that the Redeveloper shall be expected to reimburse the EDA for consultants and staff time under this agreement. The EDA has no obligation hereunder to enter into any Redevelopment Agreement in any form and the Redeveloper acknowledges that the EDA has not made any commitments in that regard. 3. The Project. The Project will consist of the redevelopment of the Site to include an approximately 255,000 square foot Class A office building or corporate campus. 4. Public Assistance. In order to achieve the foregoing redevelopment, it is anticipated that a definitive Redevelopment Agreement, if any, will contain provisions addressing a variety of forms of public assistance which may be necessary in order to accomplish the redevelopment. No commitment is presently being made to provide any form of public assistance and the Redeveloper acknowledges that the neither the EDA nor the City of Eagan has made any representations that assistance will be available. Examples of public assistance that may ultimately be agreed upon, include, but are not limited to, the following: a. Site Assembly. The EDA will consider acquisition of some or all of the Redevelopment Property based upon terms and conditions contained in the redevelopment contract, and shall consider terms for conveyance of the parcel presently owned by the City of Eagan. Acquisition may be through negotiated purchase, or condemnation or a combination. Acquisition by the EDA shall be considered only after the Redeveloper has demonstrated good faith efforts to purchase the property, and these efforts have been unsuccessful. b. Tax Increment Financing. The EDA has approved a tax increment financing district which includes the Redevelopment Property and agrees to give due consideration to any such request for tax increment assistance for the project. 5. Redeveloper's Proposed Use, Minimum Improvements. Any redevelopment contract will include a description of the minimum improvements to be made by the Redeveloper pursuant to plans which are acceptable to and approved by the EDA as part of the redevelopment contract. 6. Ownership. It is expected that any final redevelopment proposal will provide that the Project will be sold by the Redeveloper, or its assignee, to parties acceptable to the City. 7. Contingencies. It is expected that any redevelopment contract will address the following items, which the parties acknowledge may be material to the Project: a. Determination of the portion of tax increment from the tax increment financing district, if any, which will be made available to the Redeveloper; b. The acquisition of all or part of the Redevelopment Property by direct purchase or condemnation, on such terms and conditions acceptable to the EDA and as determined by the EDA in its sole and absolute discretion. c. Acceptance by the Redeveloper of a Phase I and, if requested, Phase II environmental assessment and all other environmental and wetland reports and surveys certified to the Redeveloper and its lender, deemed necessary by the EDA and the Redeveloper for all of the property located within the Project, which reports and surveys must be satisfactory to the EDA and the Redeveloper; d. The EDA and the Redeveloper have obtained all necessary approvals for the Project from any participating governmental unit, including but not limited to any necessary watershed district; e. All zoning modifications, rezoning approvals and conditional use permits necessary to allow the Project to move forward have been granted; f. The title commitment for the Redevelopment Property shall have been found acceptable to the Redeveloper in its sole discretion; g. Testing results are satisfactory to the Redeveloper including, but not limited to, soils, well, engineering, hazardous waste, and environmental reviews; h. Financing acceptable to the Redeveloper; i. The EDA agreeing to cooperate with the Redeveloper's lender or lenders and agreeing to execute any and all reasonable documents including typical subordination documents with respect to said lenders or any replacement lenders, provided that the EDA may refuse to enter into any such documents if it, in its reasonable discretion determines that to do so would create an unreasonable risk to it, jeopardize any of its security, or make it less likely that the Project would be developed as contemplated. j. Agreement on maximum density of the Site and applicable setback requirements. 8. Termination. This agreement may be terminated prior to its expiration by the EDA as to all or a portion of the Redevelopment Property upon the giving of written 3 a~ notice to the Redeveloper that the Redeveloper is not diligently pursuing the redevelopment of the portions of the Redevelopment Property. The Redeveloper shall have a reasonable time, but, in no event less than 30 days to affect a cure of such default, or to demonstrate that it is diligently pursuing such cure. The EDA may also terminate this agreement for the failure of the Redeveloper to make any payment due in accordance with Paragraph 10 below. 9. Legislative Jud n~ent. The Redeveloper understands that many of the actions which may be necessary for the Project and may be contemplated by a Redevelopment agreement involves matters of the Board of Commissioners' discretion, and in some instances, its legislative judgment. Such actions may only be made following established procedures, and the EDA cannot and does not agree, in advance, to any specific decision in such matters. 10. Consultants to be retained. The EDA intends to retain the services of Faegre & Benson LLP, and Ehlers & Associates, Inc. upon the execution of this agreement. Faegre & Benson is being retained to assist with legal matters pertaining to redevelopment financing. Ehlers & Associates, Inc. is being retained to assist the EDA in the technical matters such as project management, financial feasibility, tax increment procedures and calculations, and other factors pertaining to any claim for economic assistance. The fees and expenses of such consultants will be paid by the EDA for the period up to the execution of a definitive Redevelopment Agreement, and the responsibility for additional costs of such consultants shall be as provided in the Redevelopment Agreement. 11. Notices. All communications shall be directed to the Redeveloper at: United Properties All communications shall be directed to the EDA at: Eagan Economic Development Authority City Hall 3830 Pilot Knob Road Eagan, MN 55122-1810 4 a~ IN TESTIMONY WHEREOF, the parties hereto have set their hands as of the date and year first above written. UNITED PROPERTIES EAGAN ECONOMIC DEVELOPMENT AUTHORITY By: By: Its Its: Dated Dated By: Its: Dated: M1:882187.01 5 ~~ ` r m®® i ~2 c`~-, ~ ~ ~ /, w ~ ~ E o •` ~''~_ i~ F o b `~ ~, ~ \ ~ ~ ~~ _ A / ~ ~ w ~~ ,/ ~~~ 0 . - T /~ ^~ T '~ ,,~ V a Z ~~ .i.r .~ ~ .~ LL s e ~ _ ~4 ~ W ~° ~ ~ ^ ~® ® a ~ ~ ~° ~3 0 0 m a~~. , ~~ i ~ ® ~~ ® m ® ~ ~ ` ~ ~V~ `\1 ~ m' in a ~ ~ ~ ~ <~~~~~ ~ ~ • ~ O ~ ~ ~ ~ ~o~ ~ ~' ~ a ~ a ~ ® ~~ ~ ~ ~ ~ ~ ~ .~ ~'~ c ., c m a~ a ~ w, W a 0 ~ w W ~i ~ . ~ a ay City of Eagan, MN Preliminary Redevelopment Agreement -Legal Descriptions United Properties Map ID 1 LotBlk: 19 2723 Plat: SECTION 19 TWN 27 RANGE 23 Legal Description: PT OF N 1/2 OF NW 1/4 COM 763.9 FT S OF NE CORN 250 FT L 89D 40M 491.5 FT R 44D 50M 215 FT NW 416.78 FT TO N LINE SEC W 563.9 FT SE 1083.46 FT TO PT N 89D 40M W 647 FT OF BEGS 89D 40M E 64T FT TO BEG EX PARCEL NO 3 OF STATE R/W PLAT 19-4 Map ID 2 LotBik: 19 2723 Piat: SECTION 19 TWN 27 RANGE 23 Legal Description: PT OF NW 1!4 COM 513.9 FT S OF NE COR R 90D 20M 491.5 FT R 44D 50M 215 FT NW TO PT ON N LINE 847 FT W OF NE COR E ON N LINE TO INT WITH CEDAR AVE SE ON CEDAR TO PT OF BEG EX 1A IN NE COR Map ID 3 LotBik: A Pfat: TESSERACT ADDITION Legal Description: OUTLOT Nde: Leal Dseriptiau wen obtained from Dakota CarMy Lapel Oesaiption Database and may rqt be the full IpN deeonption d the property. Exhibit B 3~