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2021-05-17 City Council Agenda Packet A,lbertville City of Albertville Council Agenda Small Wing.Big City We. Monday, May 17, 2021 City Council Chambers 7pm Due to COVID-19, the City Council will meet using a hybrid system of in-person and virtual electronic format. Those who wish to join the meeting via Zoom,please use the link below: Zoom Link: htWs://zoom.us/j/92176133419?pwd=dGFpU2EyYTE5YjdIcnpPZGpwVGcOUT09 Zoom Meeting ID: 9217613 3419 Passcode: 522606 Zoom Audio Number: 1-301-715-8592 PUBLIC COMMENTS-The City of Albertville welcomes and encourages public input on issues listed on the agenda or of general community interest.Citizens wishing to address the Council regarding specific agenda items,other than public hearings,are invited to do so under Public Forum and are asked to fill out a"Request to Speak Card". Presentations are limited to five(5)minutes. 1. Call to Order 2. Pledge of Allegiance-Roll Call Pages 3. Recognitions—Presentations -Introductions 1. Wright County Commissioner Wetter 4. Public Forum—(time reserved 5 minutes) 5. Amendments to the Agenda 6. Consent Agenda All items under the Consent Agenda are considered to be routine by the City staff and will be enacted by one motion. In the event an item is pulled,it will be discussed in the order it is listed on the Consent Agenda following the approval of the remaining Consent items. Items pulled will be approved by a separate motion. A. Approve the May 3, 2021, regular City Council Meeting minutes as presented. 4-7 B. Authorize the Monday, May 17, 2021,payment of claims as presented, except bills 8 specifically pulled which are passed by separate motion. The claims listing has been provided to City Council as a separate document and is available for public view at City Hall upon request. C. Approve street closures as indicated for Albertville Friendly City Days and approve 9-11 Central Park hours to 11 pm on June 9-10, 2021 and to 1:30 pm on June 11-12, 2021. D. Approve a Major Temporary Outdoor Music Permit for the 152 Club, Inc. for June 19 12-15 and September 25, 2021 located at 5794 Main Avenue NE. E. Approve a Major Temporary Outdoor Music Permit for The Hen and The Hog for June 16-18 11 and June 12, 2021 located at 5262 Kyler Ave NE Suite 9111. City of Albertville City Council Agenda Monday, May 17, 2021 Page 2 of 3 7. Public Hearing A. Public Hearing on Proposed Fehn Tax Increment Financing District Request— 19-122 continued from May 3,2021, City Council meeting • Mayor to reopen the public hearing • Motion to close the public hearing (Motion to adopt Resolution No. 2021-024 approving the Establishment of Tax Increment Financing (Redevelopment)District No. 19 (Fehn)within Municipal Development District No. 1; and the Adoption of a Tax Increment Financing Plan relating thereto.) (Motion to adopt Resolution No. 2021-025 authorizing an Interfund Loan for Advance of Certain Costs in connection with Tax Increment Financing(Redevelopment)District No. 19 (Fehn).) (Motion to adopt Resolution No. 2021-027 approving Contract for Private Development with Hunter Land Company, LLC and Fehn Companies Incorporated and Awarding the Sale of, and Providing the Form, Terms, Covenants and Directions for the Issuance of its Tax Increment Revenue Note (Fehn Project) in the Maximum Principal Amount of $1,377,817.) 8. Wright County Sheriff's Office— Updates, reports, etc. 9. Department Business A. City Council 1. Committee Updates (STMA Arena, Planning, JPWB, Parks, Fire Board, FYCC etc.) 2. Planning Commission Appointment—tabled from May 3 City Council meeting 123 (Motion to adopt Resolution No. 2021-026 Appointing Planning Commission Member.) B. Building -None C. City Clerk 1. Dog License Discussion 124-128 D. Finance 1. Approve Driveway Improvement Assessment 129-135 (Motion to approve Driveway Replacement Contract for property owner Jarrod& Stephanie Deehr located at 6473 East Laketowne Drive NE, Albertville, AN 55301) E. Fire -None F. Planning and Zoning -None G. Public Works/Engineering-None H. Legal -None City of Albertville City Council Agenda Monday, May 17, 2021 Page 3 of 3 I. Administration 1. Approve Participation in the Wright County Economic Development Authority 136-146 —tabled from the May 3,2021, City Council Meeting (Motion to adopt Resolution No. 2021-022 opting the City ofAlbertville to participate in the Wright County Economic Development Authority) 2. City Survey Discussion 3. Albertville Friendly City Days Social Discussion 4. City Administrator's Update 147-148 10. Announcements and/or Upcoming Meetings May 26 Joint Powers Water Board, 6 pm Parks Committee, 7 pm May 31 City Offices will be closed in observance of Memorial Day June 7 City Council, 7 pm June 8 Planning Commission, 7 pm June 9-13 Albertville Friendly City Days June 14 STMA Arena Board, 6 pm June 21 City Council, 7 pm 11. Adjournment Nbertville Smell Y-.'gin W.B.Big CIc4 Uft. ALBERTVILLE CITY COUNCIL DRAFT REGULAR MEETING MINUTES May 3, 2021 — 7 pm Council Chambers Albertville City Hall 1. Call to Order Mayor Hendrickson called the meeting to order at 7:02 pm. 2. Pledge of Allegiance— Roll Call Present: Mayor Hendrickson, Councilmembers Cocking and Zagorski Present remotely: Councilmember Hudson Absentee: Councilmember Olson Staff Present: City Administrator-PWD Nafstad, City Attorney Couri, City Planner Brixius, Fire Chief Bullen and City Clerk Luedke. 3. Recognitions—Presentations—Introductions A. Fire Department Recognition of Bill Valerius Fire Chief Bullen recognized Fire Fighter Valerius for his dedicated service of 31 years on the Albertville Fire Department and presented him with a Fire Chief helmet. Chief Bullen stated that it was customary to receive a helmet of the highest office held in the department upon retirement. Caption Eull presented Fire Fighter Valerius with a Certificate of Appreciation and stated that he would be missed on the Albertville Fire department. Fire Fighter Valerius thanked Fire Chief Bullen, the City Council,the other fire fighters and his family for their support over the years. 4. Public Forum There was no one present for the public forum. 5. Amendments to the Agenda There were no amendments to the agenda. MOTION made by Councilmember Cocking, seconded by Councilmember Zagorski to approve the May 3, 2021, agenda as submitted. Ayes: Cocking, Hendrickson, Hudson and Zagorski. Nays: None. Absentee: Olson. The motion carried. 6. Consent Agenda All items under the Consent Agenda are considered to be routine by the City staff and will be enacted by one motion. In the event an item is pulled, it will be discussed in the order it is listed on the Consent Agenda following the approval of the remaining Consent items. Items pulled will be approved by a separate motion. A. Approve the April 19, 2021, Council Workshop Meeting minutes as presented. B. Approve the April 19, 2021,regular City Council Meeting minutes as presented. AGENDA PAGE 4 City Council Meeting Draft Minutes Page 2 Regular Meeting of May 3,2021 6. Consent Agenda C. Authorize the Monday, May 3, 2021,payment of claims as presented, except bills specifically pulled which are passed by separate motion. The claims listing has been provided to City Council as a separate document and is available for public view at City Hall upon request. D. Approve an Intoxicating Temporary On-Sale Liquor License for the Albertville Lions, Knights of Columbus 94174,Albertville Fire Relief Association and the Foxtails Snowmobile Club for June 10 through June 13, 2021 for the 2021 Friendly City Days Festival for a flat fee of$100 for the event. MOTION made by Councilmember Cocking, seconded by Councilmember Zagorski to approve the May 3, 2021, Consent Agenda as presented. Ayes: Cocking, Hendrickson, Hudson and Zagorski. Nays: None. Absentee: Olson. The motion carried. 7. Planning and Zoning A. Fehn Companies Industrial Development PUD and Final Plat City Planner Brixius presented the staff report and background information regarding the proposed zoning map amendments and the revised final plat. He answered questions from Council. MOTION made by Councilmember Zagorski, seconded by Councilmember Cocking to adopt Resolution No. 2021-023 and Ordinance No. 2021-07 addressing the following development applications for Hunter Land Company/Fehn Companies to allow for the construction of a corporate headquarters for Fehn Companies in the City of Albertville. • Zoning Map amendment to change the zoning from I-2 General Industrial to PUD/I-2 Planned Unit Development/General Industrial District. • Revised Final Plat for Fehn Industrial Park. Ayes: Cocking,Hendrickson, Hudson and Zagorski. Nays: None. Absentee: Olson. The motion carried. B. Planned Unit Development Agreement for Fehn Industrial Park City Attorney Couri provided background information on the development agreement along with the details outlined in the agreement regarding the outdoor storage, on-site crushing process and the proposed fees. He answered questions from Council. Mr. Fehn, applicant, answered questions from Council regarding the on-site crushing process. MOTION made by Councilmember Cocking, seconded by Councilmember Zagorski to approve the Planned Unit Development Agreement for Fehn Industrial Park subject to City Attorney edits. Ayes: Cocking, Hendrickson, Hudson and Zagorski.Nays: None. Absentee: Olson. The motion carried. C. Public Hearing for Proposed Fehn Tax Increment Financing District Request Mayor Hendrickson opened the public hearing. MOTION made by Councilmember Cocking, seconded by Councilmember Zagorski to continue the public hearing to the May 17 City Council Meeting at 7 pm to allow for final review by all parties. Ayes: Cocking, Hendrickson, Hudson and Zagorski. Nays: None. Absentee: Olson. The motion carried. AGENDA PAGE 5 City Council Meeting Draft Minutes Page 3 Regular Meeting of May 3,2021 8. Wright County Sheriff's Office—Updates,reports, etc. There were no updates from the Wright County Sheriff's Office. 9. Department Business A. City Council 1. Committee Updates (VTMA Ice Arena, Planning, JPRB, Parks, Fire Board, FYCC) Mayor Hendrickson provided an update on the FYCC's Bike Rodeo event and said it was a very successful event. City Administrator Nafstad provided an update from the STMA School District's Referendum Steering Committee meeting and said that another meeting had been schedule for this week to further discuss the potential referendum. Nafstad noted the information regarding a possible referendum are on the District's website. 2. Appointment of Planning Commission Member Mayor Hendrickson proposed Council move this item to the May 17, 2021, City Council meeting because Councilmember Olson was absent and Councilmember Hudson was attending remotely. The Council agreed to move the Planning Commission appointment to the May 17 Council meeting. B. Building—None C. City Clerk—None D. Finance 1. Approve Driveway Improvement Assessment City Administrator Nafstad presented the staff report and provided information on the City's Driveway Replacement program. He answered questions from Council. There was Council discussion regarding the background of the Driveway Replacement Program. MOTION made by Councilmember Cocking, seconded by Councilmember Zagorski to approve a Driveway Replacement Contract for property owner Kenneth Schmidt located at 11415-54th Street NE, Albertville, MN 55301. Ayes: Cocking, Hendrickson, Hudson and Zagorski. Nays: None. Absentee: Olson. The motion carried. E. Fire—None F. Public Works/Engineering 1. Approve Purchase of Utility Vehicle Public Work employee Minette presented the staff report along with information regarding the intended use of the proposed utility vehicle. He answered questions from Council. City Administrator Nafstad answered questions from Council regarding the purchase of the vehicle. MOTION made by Councilmember Cocking, seconded by Councilmember Zagorski to approve the purchase of a new Kubota RTV-X900L Utility Vehicle for$13,607.12. Ayes: Cocking, Hendrickson, Hudson and Zagorski. Nays: None. Absentee: Olson. The motion carried. AGENDA PAGE 6 City Council Meeting Draft Minutes Page 4 Regular Meeting of May 3,2021 G. Legal—None H. Administration 1. Approve Participation in Wright County Economic Development Authority (EDA) —tabled from the April 19,2021, City Council Meeting City Administrator Nafstad stated Wright Commissioner Wetter would be attending the May 17, 2021, Council meeting and said she could answer questions regarding the Wright County EDA. He asked if Council would like to table the item until the May 17 meeting and answered questions from Council. City Attorney Couri and City Planner Brixius answered questions from Council regarding the City's potential participation in the Wright County EDA. There was Council discussion regarding the Wright County Economic Development Authority and the consensus was to bring the item back to the May 17, 2021, City Council meeting when the Wright County Commissioner will be in attendance. 2. City Administrator's Update City Administrator Nafstad provided an update from the Parks Commission meeting concerning recent requests received regarding the possibility of reserving the Lion's shelter in Central Park and various usage requests including cricket and lacrosse for the Albertville ball fields. He said more information would be brought back to a future City Council meeting. City Planner Brixius provided information on the different field usages and possible wear on the fields. The Council discussed the different usages and requests for the Albertville ball fields. City Administrator Nafstad also provided an update on the Creamery Site and said that MnDOT had again reviewed the site and it is unlikely MnDOT will work with the city to preserve the site. City Administrator Nafstad and City Attorney Couri answered questions from Council regarding the 2021 Street Improvement project and whether additional street segments could be added to the project. Announcements and/or Upcoming Meetings May 10 STMA Arena Board, 6 pm May 11 Planning Commission, 7 pm May 19 City Council, 7 pm May 26 Joint Powers Water Board, 6 pm Parks Committee, 7 pm May 31 City Offices closed in observance of Memorial Day June 7 City Council, 7 pm 10. Adjournment MOTION made by Councilmember Zagorski, second by Councilmember Cocking to adjourn the meeting at 8:32 pm. Ayes: Cocking, Hendrickson, Hudson and Zagorski. Nays: None. Absentee: Olson. The motion carried. Respectfully submitted, Kristine A. Luedke, City Clerk AGENDA PAGE 7 �lbcrtviljc Mayor and Council Request for Action I f May 17, 2021 SUBJECT: CONSENT-FINANCE-PAYMENT OF BILLS RECOMMENDATION: It is respectfully requested that the Mayor and Council consider the following: MOTION TO: Authorize the Monday,May 17, 2021,payment of the claims as presented except the bills specifically pulled, which are passed by separate motion. The claims listing has been provided to Council as a separate document. The claims listing is available for public viewing at City Hall upon request. BACKGROUND: The City processes claims on a semi-monthly basis. The bills are approved through their respective departments and administration and passed onto the City Council for approval. KEY ISSUES: • Account codes starting with 810 are STMA Arena ExpensesNendors (bolded) and key issues will be presented in the claims listing document. POLICY/PRACTICES CONSIDERATIONS: It is the City's policy to review and approve payables on a semi-monthly basis. FINANCIAL CONSIDERATIONS: City staff has reviewed and recommends approval of payments presented. LEGAL CONSIDERATIONS: The Mayor and Council have the authority to approve all bills pursuant to Minnesota State Law, which requires all bills to be paid in a timely manner, generally within 30 days unless one party determines to dispute the billing. Responsible Person: Tina Lannes, Finance Director Submitted through: Adam Nafstad, City Administrator-PWD Attachment: List of Claims (under separate cover) AGENDA PAGE 8 A,lbertville Mayor and Council Request for Action Small Town LIWng.Big Ufs. May 17, 2021 SUBJECT: CITY CLERK-ALBERTVILLE FRIENDLY CITY DAYS COMMITTEE STREET CLOSING AND PARK HOURS REQUEST RECOMMENDATION: It is respectfully requested that the Mayor and City Council consider passing the following: MOTION TO: Approve the Albertville Friendly City Days Committee request for street closings and modified Central Park hours identified below: Street Closure Requested Dates Time Activity 58'h St NE(Main to Lander) June 9-13 All day Carnival Lander Ave NE(58'h to Gordy Berning's June 9-13 All day Carnival driveway) Main Ave NE(57'to 59') Fri.,June 11 6 pm -2:30 am Friday activities Lachman Ave NE(57'h to 60'h) Sat.,June 12 8 am - 3:00 pm Car/Truck Show Main Ave NE 57'h to 59t1i Sat.,June 12 8 am -2:30 am Saturday Activities Main Ave NE(50'h to 60'h), Sun.,June 13 12 pm-4 pm Parade 59'h St NE(Barthel Ind. Dr to Main) Barthel Ind. Dr. (51st to 59'h) 51st St NE(Barthel Ind. Dr to Main) 60th St NE(CSAH 37 to Main) Extended Central Park Hours Wednesday and Thursday,June 9-10,until 11:00 p.m. Requested Friday and Saturday,June 11-12,until 1:30 a.m. BACKGROUND: Friendly City Days will be held Wednesday, June 9 through Sunday, June 13, 2021. The Friendly City Days Committee is requesting the closure of the following streets for the community festival during the dates and times listed above. City Code Section 8-3-2 designates that City parks close at 10 pm unless special permission is given. The Committee is requesting an extension of park hours in Central Park for Friday, June 11 and Saturday, June 12 until 1:30 am. However, in Section 5-5-1,Noise Control, a civic celebration recognized by the City Council is except from the noise provisions. KEY ISSUES: • The Committee has requested the same road closures in previous years. • The Committee has notified to the Wright County Highway Department for closure of CSAH 18 (50th Street NE) on June 13. • The Committee has also submitted a request for assistance from the Wright County Sheriff's Office for security and traffic control for the event. • The bands scheduled for the Friday and Saturday performances are already under contract to perform until 1:00 am. AGENDA PAGE 9 Mayor and Council Request for Action— May 17,2021 City Clerk-AFCD Committee Request Page 2 of 2 POLICY/PRACTICES CONSIDERATIONS: The Mayor and City Council have the authority to approve or deny requests for street closures and the extension of City park hours. The City Council has approved the request as presented in the past. Responsible Person/Department: Kris Luedke, City Clerk Submitted through: Adam Nafstad, City Administrator-PWD Attachments: • Albertville Friendly City Days Committee request letter AGENDA PAGE 10 Albertville Friendly City Days P.O.Box 162 Albertville,MN 55301 April 15,2021 City of Albertville P.O.Box 9 Albertville,MN 55301 City Council, The Albertville Friendly City Days committee is requesting permission to close down the following list of streets on the days listed during Friendly City Days. Street Date Time Activity 58th Street(Main Avenue to Lander Avenue) June 9-13 All Day Carnival Lander Avenue(58th Street to Gordy Berning's Driveway) June 9-13 All Day Carnival Main Avenue(57th Street to 59th Street) June 11 6:00 pm-2:30 am Friday Activities Lachman Avenue(57'Street to 60'Street) June 12 8:00 am-3:00 pm Car and Truck Show Main Avenue(57th Street to 59th Street) June 12 8:00 am-2:30 am Saturday Activities Main Avenue(50th Street to 60th Street) June 13 12:00-4:00 pm Parade 59th Street (Barthel Industrial Drive to Main Street) June 13 12:00-4:00 pm Parade Barthel Industrial Drive(51st Street to 59th Street) June 13 12:00-4:00 pm Parade 51 st Street (Barthel Industrial Drive to Main Street) June 13 12:00-4:00 pm Parade 60th Street (CSAH 37 to Main Avenue) June 13 12:00-4:00 pm Parade For your information the committee has submitted applications to Wright County Highway Department for closing CSAH18(50th Street)on June 13. We have also requested assistance from the Wright County Sheriff's office for security and traffic disbursement for the entire weekend. Again,this year,The carnival will open on Wednesday from 3:00 p.m.to 10:00 p.m. The Firemen's Relief Association will again be sponsoring Craft Beer Tasting event during the garage band performances on Thursday evening from 6:00 p.m.to 10:00 p.m.The Lions,Foxtailers,and Firemen Relief Association will apply for a Strong Intoxicating Liquor License for the weekend. The events in the Park on Wednesday and Thursday evenings would end at 10:00 p.m. We are requesting permission to extend the hours in the city park for Wednesday and Thursday,June 9t'and 10t'until 11:00 p.m., Friday and Saturday,June 1 Ith and 12th to 1:30 am the next morning for the Carnival, Softball tournament,and Live Bands. Sincerely, LeRoy Berning Albertville Friendly City Days Committee AGENDA PAGE 11 �lbcrtvillc Mayor and Council Request for Action May 17, 2021 SUBJECT: CONSENT-CITY CLERK-TEMPORARY OUTDOOR MUSIC PERMIT RECOMMENDATION: It is respectfully requested that the Mayor and Council consider the following: MOTION TO: Approve a Major Temporary Outdoor Music Permit for the 152 Club, Inc. for June 19 and September 25, 2021 located at 5794 Main Avenue NE. BACKGROUND: The City Council revised its Temporary Outdoor Music ordinance in 2013. The revision more clearly defined the definitions of both a Major and Minor Temporary Outdoor Music Permit and the requirements that must be met for each type of permit. The June 19 music permit is for the Chad Smith Ride for Life event and the September 25 permit is for the 152 Club's annual Oktoberfest. The applicant, Trish Stevens of 152 Club, Inc.,has applied for a Major Temporary Outdoor Music Permit for both June 19 and September 25, 2021. A Major Temporary Outdoor Music Permit must meet the following requirements: 1. Any person, organization, and/or entity shall be limited to a maximum of two major permits per year. No commercial property shall host more than three major events in a calendar year. 2. The permit applicant must pay a permit fee as set by the City Council by ordinance and provide information and/or a plan(s)that demonstrates that the site event will comply with the performance standards of this code. 3. The permit applicant must demonstrate that there will be adequate sanitary facilities for the event. 4. The permit applicant must demonstrate that there will be adequate security and fencing to control access to the event at the location of the outdoor musical performance. 5. The permit applicant must have sufficient off-street parking. The music event shall not occupy required parking for the principal use of the site. 6. The major outdoor musical performance must not interfere with other commercial and governmental activities or with the quiet enjoyment of residential property. 7. The stage,performers, speakers and amplifiers are located three hundred feet from any residence located in a residential zoning district. 8. The stage, speakers, and amplifiers are arranged in a design and manner that does not directly broadcast music at or toward a residence within three hundred feet of the stage. 9. Major outdoor music events shall be allowed between May 15th and October 15th and the live outdoor musical performance shall only occur on the dates and during the hours designated by the City Council. 10. Major outdoor music events shall not perform beyond 12 midnight. 11. The volume of the outdoor musical performance must be reasonable. The permit holder shall comply with all requests of the Sheriff's Department to reduce volumes to mitigate nuisance complaints. AGENDA PAGE 12 Mayor and Council Request for Action—May 17, 2021 152 Club,Inc. Outdoor Music Event Page 2 of 2 12. Failure to abide by these standards or the receipt of nuisance complaints may be grounds for denial of future major outdoor music permits for the property. The applicant has previously held both Major and Minor Temporary Outdoor Music Permits and is familiar with the requirements that must be met. KEY ISSUES: • The applicant has submitted a site plan showing the location of speakers, fencing and security, and has indicated adequate sanitary facilities as well as parking. • For the event on June 19, the music will be played from 7 pm to 11:59 pm and on September 25, the music will be played from 3 pm to 11:59 pm. • The applicant has indicated they will abide by the noise requirements. • The applicant has submitted the fee. POLICY/PRACTICES CONSIDERATIONS: The Mayor and City Council have the authority to approve or deny any Temporary Outdoor Music Permit. FINANCIAL CONSIDERATIONS: There is minimal financial revenue collected from the applicant for the music permit. Responsible Person/Department: Kris Luedke, City Clerk Submitted Through: Adam Nafstad, City Administrator-PWD Attachments: • Temporary Outdoor Music Application on file in the City Clerk's office. • Music Site Plan AGENDA PAGE 13 a Page I of I Aw�MIMM1aMrMgM�M�Ns MMq/MM'MM'Mtu1.lMtrlry. 1 , � '&��,e yr+ . ��;5<;.L� c ` 1 Lo �'r��ve res)� r- �?z ��ki� �LLI �CX.•r+'lr � a'�.��•" CC1. ,ate ••fi �, j�c ��1 C�Cf�•. M . te i � -t:.e.•� °I eakV It'd -k,,v _*u Cti_I I' � (��f c.t tt , { - Tr Iti-f https:/imaps.google.cflm/maps?hl—en&q=5794XU'ii+Aventte+Nortltesst,OA lbenville,+M... 9/1 V2012 AGENDA PAGE 14 Beacon Wright County, MN Overview ti .�x -e► 1 1� Legend ,y� Roads — CSAHCL 1 1 41OD1020 — CTYCL — MUNKL t r>�srt- rI - PRIVATECL ! ! - — TWPCL `U�14?ClQ-1030 � Highways — Interstate - 1 State Hwy US Hwy 1 1000K]4 City/Township Limits Q c UJI [3t ua p , , • � ' 1—' Parcels -��; U1• 1 9 1 1. qii 1 Parcel ID 101141001020 Alternate ID n/a Owner Address n/a Sec/Twp/Rng 01-120-024 Class 233-COMM LAND&BLDGS Property Address 5794 MAIN AVE NE Acreage n/a ALBERTVILLE District 0102 CITY OF ALBERTVILLE 885 Brief Tax Description Sect-01 Twp-120 Range-024 ALBERTVILLE RAILWAY EXCHANGE Lot-002Block-001 (Note:Not to be used on legal documents) Date created:7/10/2019 Last Data Uploaded:7/30/2019 3.33:56 AM Developed by" 4[O�s F% L. AGENDA PAGE 15 �lbcrtvillc Mayor and Council Request for Action May 17, 2021 SUBJECT: CONSENT-CITY CLERK-TEMPORARY OUTDOOR MUSIC PERMIT RECOMMENDATION: It is respectfully requested that the Mayor and Council consider the following: MOTION TO: Approve a Major Temporary Outdoor Music Permit for the Hen and The Hog for June 11 and June 12, 2021 located at 5262 Kyler Ave NE Suite 9111. BACKGROUND: The City Council revised its Temporary Outdoor Music ordinance in 2013. The revision more clearly defined the definitions of both a Major and Minor Temporary Outdoor Music Permit and the requirements that must be met for each type of permit. The applicant, Matt Taus of The Hen and The Hog has applied for a Major Temporary Outdoor Music Permit for both June 11 and June 12, 2021. A Major Temporary Outdoor Music Permit must meet the following requirements: 1. Any person, organization, and/or entity shall be limited to a maximum of two major permits per year. No commercial property shall host more than three major events in a calendar year. 2. The permit applicant must pay a permit fee as set by the City Council by ordinance and provide information and/or a plan(s)that demonstrates that the site event will comply with the performance standards of this code. 3. The permit applicant must demonstrate that there will be adequate sanitary facilities for the event. 4. The permit applicant must demonstrate that there will be adequate security and fencing to control access to the event at the location of the outdoor musical performance. 5. The permit applicant must have sufficient off-street parking. The music event shall not occupy required parking for the principal use of the site. 6. The major outdoor musical performance must not interfere with other commercial and governmental activities or with the quiet enjoyment of residential property. 7. The stage, performers, speakers and amplifiers are located three hundred feet from any residence located in a residential zoning district. 8. The stage, speakers, and amplifiers are arranged in a design and manner that does not directly broadcast music at or toward a residence within three hundred feet of the stage. 9. Major outdoor music events shall be allowed between May 15th and October 15th and the live outdoor musical performance shall only occur on the dates and during the hours designated by the City Council. 10. Major outdoor music events shall not perform beyond 12 midnight. 11. The volume of the outdoor musical performance must be reasonable. The permit holder shall comply with all requests of the Sheriff's Department to reduce volumes to mitigate nuisance complaints. 12. Failure to abide by these standards or the receipt of nuisance complaints may be grounds for denial of future major outdoor music permits for the property. AGENDA PAGE 16 Mayor and Council Request for Action—May 17, 2021 The Hen and The Hog Outdoor Music Event Page 2 of 2 KEY ISSUES: • The applicant has submitted a site plan showing the location of speakers, fencing and security, and has indicated adequate sanitary facilities as well as parking. • The applicant has indicated they will abide by the noise requirements. POLICY/PRACTICES CONSIDERATIONS: The Mayor and City Council have the authority to approve or deny any Temporary Outdoor Music Permit. FINANCIAL CONSIDERATIONS: There is minimal financial revenue collected from the applicant for the music permit. Responsible Person/Department: Kris Luedke, City Clerk Submitted Through: Adam Nafstad, City Administrator-PWD Attachments: • Temporary Outdoor Music Application on file in the City Clerk's office. • Music Site Plan AGENDA PAGE 17 i C o I l 6 P o d Z W OE o p �- 0 j TTTTL—j o a tic 2't— nd � Q 5Ua p � ► � jAL i f �lbcrtvillc Mayor and Council Request for Action May 17, 2021 SUBJECT: ALBERTVILLE TIF NO. 19 (FEHN INDUSTRIAL PARK) TIF PLAN AND CONTRACT FOR PRIVATE DEVELOPMENT RECOMMENDATION: It is respectfully requested that the Mayor and Council consider the following: MOTION TO: Adopt Resolution No. 2021-024 approving the Establishment of Tax Increment Financing (Redevelopment) District No. 19 (Fehn)within Municipal Development District No. 1; and the Adoption of a Tax Increment Financing Plan Relating Thereto; AND MOTION TO: Adopt Resolution No. 2021-025 authorizing an Interfund Loan for Advance of Certain Costs in Connection with Tax Increment Financing (Redevelopment) District No. 19 (Fehn); AND MOTION TO: Adopt Resolution No. 2021-027 approving Contract For Private Development With Hunter Land Company, LLC And Fehn Companies Incorporated And Awarding The Sale Of, And Providing The Form, Terms, Covenants And Directions For The Issuance Of Its Tax Increment Revenue Note (Fehn Project) hi The Maximum Principal Amount Of$1,377,817. BACKGROUND: Fehn Companies, Inc. is proposing to redevelop Lot 1, Block 1 in the plat approved as Fehn Industrial Park by constructing approximately 49,200 square feet of storage, office and shop space on a lot that currently contains a blighted residential home. Because the home is blighted, this property qualifies for a redevelopment Tax Increment Financing District (TIF), which can span up to 26 years if the Council so desires. Staff is recommending that the TIF District be established for 26 years to assist with the redevelopment costs that will be incurred by Fehn in constructing the proposed development. Fehn is proposing to construct approximately 8,468 square feet of office by December 31, 2022, 33,000 square feet of shop/storage space by December 31, 2023, an additional 1,763 square feet of office space by December 31, 2027 and an additional 6,000 square feet of shop/storage space by December 31, 2028. Fehn has indicated that Fehn will incur in excess of$1,377,000 in development costs to develop the Fehn Industrial Park property, which would include demolition costs, land acquisition and site preparation costs, including a significant amount of soils correction work. Fehn has indicated that this project is not feasible without the assistance of$1,377,000 in TIF assistance. The attached TIF plan indicates that the proposed development will generate tax increment in the amount of$2,592,000 over the 26-year life of the TIF. After deducting administrative costs and interest financing costs,that leaves a present value of$1,377,000 available to provide to Fehn to P:ACity CounciWouncil Packet Information\2021\051721\RCA TIF,5-12-21,revised.docx AGENDA PAGE 19 Mayor and Council Request for Action -May 17,2021 Fehn Industrial Park TIF Plan & Contract for Private Development Page 2 of 3 assist with the financing of this development.Note that the City can establish the TIF for a time period less than 26 years, but that will reduce the amount of TIF assistance available to Fehn and may jeopardize the viability of the project. The TIF is proposed to be set up as a"pay-as-you-go" TIF, meaning that Fehn pays for all of the necessary improvements up front(usually by borrowing money from a bank)while the City issues a Note Payable to Fehn in the amount of$1,377,000 with interest at the lesser of 4%per annum or Fehn's mortgage interest rate. The Note is payable solely from TIF funds generated by the TIF District and is not a general obligation of the City. If the TIF generates sufficient funds, the entire $1,377,000 plus interest will be paid to Fehn over the life of the TIF. If the TIF does not generate sufficient funds, Fehn takes the risk that all of the Note principal and interest may not be paid back. Upon the expiration of the TIF, the property will return to the tax rolls and all taxes paid will be split between the City, School District, County and the State according to State law. The City is proposing to keep 5% of the TIF generated ($129,000)for administrative costs to fund the establishment of the TIF and its administration over the next 26 years. The Contract for Private Development is an agreement between Fehn and the City that requires: 1. Fehn to redevelop the property by building the office building and shop space detailed above by the dates detailed above. 2. Create at least two full-time permanent jobs and two full-time seasonal jobs within two years at an hourly rate of at least$20.00 per hour plus benefits. 3. Operate the facility as an office/shop/storage for the 26-year term of the TIF. hi exchange, the City will issue a Note Payable to Fehn in an amount up to $1,377,000 (provided Fehn has that amount of qualifying TIF costs)that will be payable solely from TIF proceeds that will be generated from the property taxes that Fehn pays and the City captures under the TIF district. The Developer will receive up to a maximum amount of$2,462,183 (both principal and interest) in TIF revenues if the TIF follows current projections. The amounts projected to be generated by the TIF are shown on the attached TIF Plan prepared by Northland Securities. KEY ISSUES: • The City will use TIF proceeds to pay Developer up to a maximum of$2,462,183 in both principal and interest and will memorialize this obligation by issuing a Note Payable to Fehn in an amount up to $1,377,000 that will be payable only from TIF proceeds. • Fehn will construct approximately 49,200 square feet of storage, office and shop space over the next seven years on a lot that currently contains a blighted residential home. • Fehn will operate the facility as an office/shop/storage facility for the 26-year life of the TIF. • Fehn will create two full-time permanent jobs and two full-time seasonal jobs within two years at an hourly rate of at least$20.00 per hour plus benefits. • If Fehn does not meet these obligations, the City can halt payments to Fehn, reduce payments to Fehn, or ultimately,terminate the Agreement. AGENDA PAGE 20 Mayor and Council Request for Action -May 17,2021 Fehn Industrial Park TIF Plan & Contract for Private Development Page 3 of 3 • This TIF will be a"pay-as-you-go" TIF in which the City would only provide Fehn with TIF revenues on a semi-annual basis after the City receives the TIF monies from the County. • Upon the earlier of the full payment of the Note or after twenty-six years of increment are collected, the TIF District will be decertified and the City, County and School District will be able to collect the tax revenues from this development in the same way they do for all other non-TIF properties in the City. • The interfund loan resolution is necessary to allow the City to advance funds for the payment of the establishment of the TIF that will eventually be paid back from TIF revenues generated by the project. POLICY/PRACTICES CONSIDERATIONS: The City has established only one other redevelopment TIF in the City(on the old Eull Concrete site) and that TIF was projected to last only 10 years. Ultimately, that TIF was decertified when the project did not materialize within five years of the establishment of the as required by law. All other TIFs established by the City have been economic development TIFs which are limited to 9 years of tax increment, except for the Guardian Angels TIF which is a 26-year housing TIF District. The City has the authority to establish this redevelopment TIF for any period up to 26 years. FINANCIAL CONSIDERATIONS: The City would provide approximately up to a maximum of$2,462,183 in tax increment to Fehn over the life of the TIF if established over a 26-year period. The City would retain approximately 5% of the TIF revenue for administrative costs. During the life of the TIF the City, School District and County would still collect the same amount of taxes from the property that they currently are collecting. Upon expiration of the TIF in approximately 2049, the City, County and School District will collect the additional revenue generated by the proposed development in the same manner as they do for other properties. LEGAL CONSIDERATIONS: This Agreement is the City's standard TIF Agreement, other than the proposed 26-year duration, and will be binding upon both parties once it is approved and signed. Department/Responsible Person: Tina Lannes, Finance Director; Mike Couri, City Attorney. Submitted Through: Adam Nafstad, City Administrator/Public Works Director Attachments: 1. Tax Increment Financing Plan 2. Contract for Private Development 3. Resolution No. 2021-024 approving Tax Increment Financing Plan 4. Resolution No. 2021-025 Authorizing Interfund Loan 5. Resolution No. 2021-027 approving Contract for Private Development and Authorizing Issuance of Note Payable AGENDA PAGE 21 DRAFT CITY OF ALBERTVILLE, MINNESOTA TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 (FEHN) WITHIN MUNICIPAL DEVELOPMENT DISTRICT NO. 1 PUBLIC HEARING DATE: , 2021 PLAN APPROVED DATE: , 2021 PLAN CERTIFICATION REQUEST DATE: , 2021 PLAN CERTIFIED DATE: 12021 I Northland Securities,Inc. 150 South Fifth Street, Suite 3300 Minneapolis, 0 55402 NORTHLAND �� 4r PUBLIC FINANCE Member NASD and SIPC I Registered with SEC and MSRB AGENDA PAGE 22 TABLE OF CONTENTS ARTICLE I - INTRODUCTION AND DEFINITIONS.........................................................I Section 1.01 Introduction ......................................................................................1 Section1.02 Definitions.........................................................................................1 Section 1.03 Plan Preparation...............................................................................1 ARTICLE II -TAX INCREMENT FINANCING PLAN.........................................................2 Section 2.01 Statutory Authority..........................................................................2 Section 2.02 Planned Development.....................................................................2 2.02.1 Development Description..........................................................................2 2.02.2 City Plans and Development Program....................................................2 2.02.3 Land Acquisition.........................................................................................2 2.02.4 Development Activities..............................................................................2 2.02.5 Need for Tax Increment Financing...........................................................2 Section 2.03 Tax Increment Financing District...................................................3 2.03.1 Designation..................................................................................................3 2.03.2 Boundaries of TIF District..........................................................................3 2.03.3 Type of District............................................................................................3 Section 2.04 Plan for Use of Tax Increment........................................................4 2.04.1 Estimated Tax Increment............................................................................4 2.04.2 Public Development Costs.........................................................................4 2.04.3 Estimated Sources and Uses of Funds.....................................................4 Figure2-1......................................................................................................5 2.04.4 Administrative Costs..................................................................................5 2.04.5 County Road Costs.....................................................................................5 2.04.6 Bonded Indebtedness.................................................................................5 2.04.7 Election of First Year of Tax Increment and Duration of TIF District..6 2.04.8 Estimated Impact on Other Taxing Jurisdictions...................................6 2.04.9 Prior Planned Improvements....................................................................6 ARTICLE III -ADMINISTERING THE TIF DISTRICT ......................................................7 Section 3.01 Filing and Certification....................................................................7 Section 3.02 Modifications of the Tax Increment Financing Plan....................7 Section 3.03 Correcting Redevelopment Conditions........................................7 Section 3.04 Four-Year Knockdown Rule...........................................................8 Section 3.05 Pooling and Five-Year Rule.............................................................8 Section 3.06 Financial Reporting and Disclosure Requirements.....................9 Section 3.07 Business Subsidy Compliance........................................................9 EXHIBITS..........................................................................................................................10 Exhibit I Present Value Analysis..................................................................10 Exhibit II Projected Tax Increment................................................................11 Exhibit III Impact on Other Taxing Jurisdictions..........................................12 Exhibit IV Estimated Tax Increment Over Life of District ..........................13 Exhibit V Map of TIF District and Development District..........................14 Exhibit VI Inspection Report of Property......................................................15 AGENDA PAGE 23 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 ARTICLE I — INTRODUCTION AND DEFINITIONS SECTION 1.01 INTRODUCTION The City of Albertville proposes to provide tax increment financing assistance through the establishment of Tax Increment Financing(Redevelopment) District No. 19 (Fehn) (the "TIF District")within Municipal Development District No. 1 to assist with the phased construction of approximately 49,200 square feet of storage, office, and shop space for a private business to operate its earthwork and demolition services. This document contains the plan for the TIF District which is consistent with the objectives of the Development Program for Municipal Development District No. 1, as most recently amended pursuant to City Resolution No. 2015-025 adopted June 15, 2015. SECTION 1.02 DEFINITIONS For the purposes of this document, the terms below have the meanings given in this section, unless the context in which they are used indicates a different meaning: 1. "City" means the City of Albertville,Minnesota. 2. "City Council" means the City Council of the City. 3. "County" means Wright County,Minnesota. 4. "County Auditor" means the County Auditor/Treasurer of the County. 5. "Developer" means the party undertaking construction of the Development in the TIF District,which is anticipated to be Hunter Land Company, LLC, its successors or assigns. 6. "Development" means the construction and development of approximately 49,200 square feet of storage, office, and shop space. 7. "Development District" means Municipal Development District No. 1 within the City, which was established pursuant to the Development District Act. 8. "Development District Act" means Minnesota Statutes, Sections 469.124 through 469.134, as amended and supplemented from time to time. 9. "Development Program" means the Development Program for the Development District, as amended and supplemented from time to time. 10. "Project Area" means the geographic area of the Development District. 11. "Public Development Costs" means the cost of the development activities that will or are expected to occur within the Project Area or TIF District. 12. "School District" means Independent School District No. 728. 13. "State" means the State of Minnesota. 14. "TIF Act" means Minnesota Statutes,Sections 469.174 through 469.1794, as amended,both inclusive. 15. "TIF District" means Tax Increment Financing (Redevelopment)District No. 19 (Fehn). 16. "TIF Plan'means the tax increment financing plan for the TIF District (this document). SECTION 1.03 PLAN PREPARATION This document was prepared for the City by Northland Securities, Inc. DRAFT FOR MAY 3, 2021 PUBLIC HEARING 1 AGENDA PAGE 24 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 ARTICLE II - TAX INCREMENT FINANCING PLAN SECTION 2.01 STATUTORY AUTHORITY The TIF District and this TIF Plan are established under the authority of the TIF Act. SECTION 2.02 PLANNED DEVELOPMENT 2.02.1 Development Description The Developer proposes to undertake the phased construction of approximately 49,200 square feet of storage, office, and shop space. The Development will occur in phases. For purposes of the TIF Plan, the timing for project commencement and completion and estimated first year of increment from each phase of development is as follows: Building Project Year of Project Year of First Year of Phase Development Square Feet Commencement Completion Tax Increment 1 Shop Space,Heated 13,000 2022 2023 2024 1 Shop Space,Non-Heated 20,000 2022 2023 2024 1 Office Space 8,468 2021 2022 2024 2 Office Space 1,763 2027 2027 2029 2 Shop Space 6,000 2027 2028 2030 Total 49,231 2.02.2 City Plans and Development Program In addition to achieving the objectives of the Development Program, the Development is consistent with and works to achieve the development objectives of the City. The TIF Plan for the TIF District conforms to the general plan for development or redevelopment of the City as a whole. The City has adopted land use controls to guide the use of property. The development plans for the Development in the TIF District have been reviewed by the Planning Commission and the City Council, and conform to current land use controls. 2.02.3 Land Acquisition The Developer will acquire the property within the TIF District. 2.02.4 Development Activities As of the date of approval of the TIF Plan, the City anticipates that activities proposed in the TIF Plan will be subject to contracts. The City anticipates entering into a contract with the Developer to construct the Development and provide tax increment financing assistance to the Developer to reimburse Public Development Costs incurred by the Developer. 2.02.5 Need for Tax Increment Financing In the opinion of the City, the Development would not reasonably be expected to occur solely through private investment within the foreseeable future and the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the Development after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the TIF Plan. The reasons and facts supporting this finding include the following: • The Development requires public financial assistance to offset land and building acquisition and site improvement and preparation costs to allow for the Developer to proceed with DRAFT FOR MAY 3, 2021 PUBLIC HEARING 2 AGENDA PAGE 25 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 construction of the Development. • A comparative analysis of estimated market values both with and without establishment of the TIF District and the use of tax increments has been performed as described above and is shown in Exhibit I. This analysis indicates that the increase in estimated market value of the Development(less the present value of the projected tax increments for the maximum duration permitted by the TIF Plan) exceeds the estimated market value of the site prior to the establishment of the TIF District. SECTION 2.03 TAX INCREMENT FINANCING DISTRICT 2.03.1 Designation This TIF District is designated as Tax Increment Financing (Redevelopment)District No. 19 (Fenn). 2.03.2 Boundaries of TIF District The boundaries of the TIF District are depicted in Exhibit V. The TIF District includes parcel 101-800-063301 and the immediate adjacent roads and right-of-way to this property. Parcel 101-800-063301 is described as follows: • Lot 1, Block 1, Fenn Industrial Park according to the plat of record in the Wright County Recorder's Office, Wright County, Minnesota. 2.03.3 Type of District The TIF District is established as a "redevelopment district" pursuant to Section 469.174, subdivision 10 of the TIF Act. The City has determined that the property in the TIF District meets the statutory criteria for a redevelopment district. Section 469.174, subdivision 10 (a) (1) of the TIF Act requires two tests for occupied parcels be met to qualify as a"redevelopment district": a conditions test and coverage test. For a "redevelopment district" more than 50%of the buildings,not including outbuildings,must be found to be structurally substandard to a degree requiring substantial renovation or clearance. The conditions test for structurally substandard is defined under Section 469.174, subdivision 10(b) of the TIF Act. For purposes of that subdivision, "structurally substandard" means 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." Buildings are not eligible to be considered structurally substandard unless they meet certain additional criteria, as set forth in Section 469.174, subdivision 10(c) of the TIF Act.A 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% 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 structural repairs, or other similar reliable evidence. Items 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 of deterioration, or other similar reliable evidence. Furthermore, parcels consisting of 70%of the area of the district must be occupied by buildings, streets,utilities, or paved or gravel parking lots to meet the required coverage test. The coverage required by the parcel to be considered occupied is defined under Section 469.174, subdivision 10(e) of the TIF Act. For purposes of such subdivision, a parcel is not occupied by buildings, DRAFT FOR MAY 3, 2021 PUBLIC HEARING 3 AGENDA PAGE 26 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 streets,utilities, or paved or gravel parking lots unless 15%of the area of the parcel contains building, streets,utilities, or paved or gravel parking lots. As summarized in the table below, 100%of the area of the TIF District is occupied by improved parcels, and 100%of the buildings within the TIF District are found to be substandard. The substandard buildings are reasonably distributed. The detailed results of the building inspection and analysis performed by LHB, Inc. is contained in the report from LHB, Inc. dated March 30, 2021 and included in Exhibit V of the TIF Plan. Iri summary the findings are as follows: Numberof Parcels.............................................................................................................1 Site Area Included (square feet without roads)...................................................48,426 Area of Improved Parcels (square feet)................................................................48,426 Percent of Area Improved........................................................................................100% Number of Parcels with Buildings.................................................................................1 Number of Buildings found Substandard.....................................................................1 Percent of Buildings found Substandard............................................................... 1000 SECTION 2.04 PLAN FOR USE OF TAX INCREMENT 2.04.1 Estimated Tax Increment The original net tax capacity of value of the TIF District will be set by the County upon request for certification. For the purposes of the TIF Plan,the estimated original net tax capacity is $3,642. This amount is estimated based on the most recent published estimated market value of $219,600 for Parcel 101-800-063301 with tax capacity value calculated for commercial property. The total tax capacity value of the property after Development completion(for taxes payable in 2024)is estimated to be$64,750. This amount is based on a total estimated taxable market value of$3,350,0000 with property classified as commercial. The estimated difference between the total tax capacity value after Development completion and the original net tax capacity value is the captured tax capacity value in the amount of$61,108 for the creation of tax increment. The total local tax rate is estimated at 134.723%based on the tax rates for taxes payable in 2021. The TIF Plan assumes that this rate will be set as the original local tax rate for the TIF District. At the time of the certification of the original net tax capacity for the TIF District, the County Auditor shall certify the original local tax rate that applies to the TIF District. The original local tax rate is the sum of all the local tax rates, excluding that portion of the school rate attributable to the general education levy under Minnesota Statutes Section 126C.13, that apply to a property in the TIF District. The local tax rate to be certified is the rate in effect for the same taxes payable year applicable to the tax capacity values certified as the TIF District's original tax capacity. The resulting tax capacity rate is the original local tax rate for the life of the TIF District. Under these assumptions, the estimated annual tax increment will be$82,031 after Development completion and after deducting for the State Auditor's fee(0.36%of the captured tax increments). The actual tax increment will vary according to the certified original tax capacity value and original tax rate,the actual property value produced by the Development and the changes in property value and State tax policy over the life of the TIF District. It is the intent of the City to retain 100%of the captured tax capacity value for the duration of the TIF district. Exhibit II contains the projected tax increment over the life of the TIF District. DRAFT FOR MAY 3, 2021 PUBLIC HEARING 4 AGENDA PAGE 27 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 2.04.2 Public Development Costs The City will use tax increment to pay Public Development Costs. A contract between the City and the Developer will define the means for verifying Public Development Costs incurred by the Developer that will be eligible for reimbursement and the means of disbursing tax increments collected by the City. The City will use tax increment to pay financing costs. The interest rate payable on bonds issued, will be set pursuant to approving resolutions. The definition of"bonds' includes interfund loans and tax increment financing revenue notes. 2.04.3 Estimated Sources and Uses of Funds The estimated sources of revenue, along with the estimated Public Development Costs of the TIF District, are itemized in Figure 2-1 that follows. Such costs are eligible for reimbursement from tax increments, and other listed sources of revenue from the TIF District. The City reserves the right to administratively adjust the amount of any of the Public Development Cost items listed in Figure 2-1, so long as the total estimated tax increment project costs amount,not including financing costs, is not increased. FIGURE 2-1 ESTIMATED SOURCES AND USES OF FUNDS Total Estimated Tax Increment Revenues(from tax increment generated by the district) Tax increment revenues distributed from the County $2,582,000 Interest and investment earnings $10,000 Sales/lease proceeds $0 Market value homestead credit $0 Total Estimated Tax Increment Revenues $2,592,000 Estimated Project/Financing Costs(to be paid or financed with tax increment) Project costs Land/building acquisition $422,000 Site improvements/preparation costs $955,817 Utilities $0 Other qualifying improvements $0 Administrative costs $129,000 Estimated Tax Increment Project Costs $1,506,817 Estimated financing costs Interest expense $1,085,183 Total Estimated Project/Financing Costs to be Paid from Tax Increment $2,592,000 Estimated Financing Total amount of bonds to be issued $1,506,817 2.04.4 Administrative Costs The City plans to use tax increment revenues to pay for administrative expenses for the TIF District. The use of tax increment revenues to pay administrative expenses will not exceed the maximum amount of 10%of tax increment revenues pursuant to the TIF Act. The City will use these monies to pay for and reimburse itself for costs of administering the TIF District as allowed by the TIF Act. The estimated amount of tax increment revenue planned to pay administrative expense is shown in Figure 2-1. Anticipated administrative expenses of the TIF DRAFT FOR MAY 3, 2021 PUBLIC HEARING 5 AGENDA PAGE 28 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 District include annual audit of the fund for the TIF District, preparation of annual reporting, legal publication of annual report, and administration of the development agreement. 2.04.5 County Road Costs The Development will not substantially increase the use of county roads and necessitate the need to use tax increments to pay for county road improvements. 2.04.6 Bonded Indebtedness The total amount of bonds estimated to be issued is shown in Figure 2-1. The City will not issue any general obligation bonded indebtedness as a result of the TIF Plan. Pursuant to Section 469.178, subdivision 7 of the TIF Act, the City may advance or loan money to finance expenditures under Section 469.176, subdivision 4 of the TIF Act, from the general fund of the City or any other legally authorized fund under which it has legal authority to do so, subject to the following provisions: (a) Not later than 60 days after money is transferred, advanced, or spent,whichever is earliest, the loan or advance must be authorized by resolution of the City. (b)The resolution may generally grant to the City the power to make interfund loans under one or more tax increment financing plans or for one or more districts. The resolution may be adopted before or after the adoption of the tax increment financing plan or the creation of the tax increment financing district from which the advance or loan is to be repaid. (c)The terms and conditions for repayment of the loan must be provided in writing. The written terms and conditions may be in any form,but must include, at a minimum, the principal amount,the interest rate, and maximum term. Written terms may be modified or amended in writing by the City before the latest decertification of any tax increment financing district from which the interfund loan is to be repaid. The maximum rate of interest permitted to be charged is limited to the greater of the rates specified under Minnesota Statutes, Section 270C.40 or 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 549.09 are from time to time adjusted. Loans or advances may be structured as draw- down or line-of-credit obligations of the lending fund. (d)The City shall report in the annual report submitted under Section 469.175, subdivision 6 of the TIF Act: (1) the amount of any interfund loan or advance made in a calendar year; and (2) any amendment of an interfund loan or advance made in a calendar year. 2.04.7 Election of First Year of Tax Increment and Duration of TIF District Pursuant to Section 469.175, subdivision 1 of the TIF Act, the City elects year 2024 to be the first year to receive increment. The duration to collect and spend tax increments on eligible purposes is set at the maximum duration of twenty-five (25)years after the date of receipt of the first tax increment or twenty-six (26)years of tax increment collection. The estimated date for receipt of the first tax increment is July 1, 2024, and the decertification date is December 31, 2049. 2.04.8 Estimated Impact on Other Taxing Jurisdictions Exhibits III and IV show the estimated impact on other taxing jurisdictions if the maximum projected retained captured net tax capacity of the TIF District was hypothetically available to the other taxing jurisdictions. The City believes that there will be no adverse impact on other taxing jurisdictions during the life of the TIF District,since the Development would not have occurred without the establishment of the TIF District and the provision of public assistance.A positive impact on other taxing jurisdictions will occur when the TIF District is decertified and DRAFT FOR MAY 3, 2021 PUBLIC HEARING 6 AGENDA PAGE 29 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 the Development therein becomes part of the general tax base. The City anticipates minimal impact of the Development on City-provided services. There may be minimal borrowing costs to the City for the Development.A manageable increase in water and sewer usage is expected. It is anticipated that there may be a slight but manageable increase in police and fire protection duties due to the Development. 2.04.9 Prior Planned Improvements There have been no building permits issued in the last 18 months in conjunction with any of the properties within the TIF District.The City will include this statement with the request for certification to the County Auditor. ARTICLE III — ADMINISTERING THE TIF DISTRICT SECTION 3.01 FILING AND CERTIFICATION The filing and certification of the TIF Plan consists of the following steps: 1. Upon adoption of the TIF Plan, the City shall submit a copy of the TIF Plan to the Minnesota Department of Revenue and the Office of the State Auditor. 2. The City shall request that the County Auditor certify the original net tax capacity and net tax capacity rate of the TIF District. To assist the County Auditor in this process, the City shall submit copies of the TIF Plan, the resolution establishing the TIF District and adopting the TIF Plan, and a listing of any prior planned improvements. 3. The City shall send the County Assessor any assessment agreement establishing the minimum market value of land and improvements within the TIF District and shall request that the County Assessor review and certify the assessment agreement as reasonable. The City does not expect to enter into an assessment agreement in connection with the Development. SECTION 3.02 MODIFICATIONS OF THE TAX INCREMENT FINANCING PLAN The City reserves the right to modify the TIF District and the TIF Plan. Under current State law, the following actions can only be approved after satisfying all the necessary requirements for approval of the original TIF Plan(including notifications and public hearing): ■ Reduction or enlargement in the geographic area of the Development District or the TIF District. ■ Increase in the amount of bonded indebtedness to be incurred. ■ Increase in the amount of capitalized interest. ■ Increase in that portion of the captured net tax capacity to be retained by the City. ■ Increase in the total estimated Public Development Costs, including administrative costs of the City. ■ Designation of additional property to be acquired by the City. Other modifications can be made by resolution of the City. In addition, the original approval process does not apply if(A) (1) the only modification is elimination of parcels from the TIF District and (2)the current net tax capacity of the parcels eliminated equals or exceeds the net tax capacity of those parcels in the TIF District's original net tax capacity, or(B) the City agrees that the TIF District's original net tax capacity will be reduced by no more than the current net tax capacity of the parcels eliminated. DRAFT FOR MAY 3, 2021 PUBLIC HEARING 7 AGENDA PAGE 30 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 The City must notify the County Auditor of any modification that reduces or enlarges the geographic area of the TIF District. The geographic area of the TIF District may be reduced but not enlarged after five years following the date of certification. SECTION 3.03 CORRECTING REDEVELOPMENT CONDITIONS Section 469.176, subdivision 4j of the TIF Act requires that at least 90%of the revenues derived from tax increments from the TIF District be used to finance the cost of correcting conditions that allow designation of the TIF District as a redevelopment district. These costs include, but are not limited to, acquiring properties containing structurally substandard buildings or improvements or hazardous substances, pollution, or contaminants, acquiring adjacent parcels necessary to provide a site of sufficient size to permit development, demolition and rehabilitation of structures, clearing of the land, the removal of hazardous substances or remediation necessary for the development of the land, and installation of utilities, roads, sidewalks, and parking facilities for the site. The allocated administrative expenses of the City, including the cost of preparation of the development action response plan, may be included in the qualifying costs. SECTION 3.04 FOUR-YEAR KNOCKDOWN RULE The provision of the TIF Act referred to as the Four-Year Knockdown Rule requires development activity to take place on each parcel within a tax increment financing district within four years from the date of certification of the original net tax capacity of such tax increment financing district. If development activity on a parcel has not begun within the required time frame,no additional tax increment may be collected from that parcel and its value must be excluded from the district's original net tax capacity. Development activity includes demolition, rehabilitation, renovation or site improvement, including a qualified improvement of an adjacent street, on a parcel located within the TIF District. If no development activity has occurred within four years from the date of certification then that parcel shall be excluded from the TIF District and the original net tax capacity shall be adjusted accordingly. The City must submit to the County Auditor,by February 1 of the fifth year, evidence that the required activity has taken place for each parcel in the TIF District. If a parcel is excluded from the TIF District and the City or owner of the parcel subsequently commences any of the above activities, the City shall recertify to the County Auditor that such activity has commenced and the parcel shall once again be included in the TIF District. The County Auditor shall certify the net tax capacity of the parcel, as most recently certified by the Commissioner of Revenue, and add such amount to the original net tax capacity of the TIF District. SECTION 3.05 POOLING AND FIVE-YEAR RULE An amount equal to at least 75%of the total revenue derived from tax increments paid by properties in the TIF District must be expended on activities in the TIF District or to pay bonds, to the extent that the proceeds of the bonds were used to finance activities in the TIF District or to pay, or secure payment of, debt service on credit enhanced bonds. Not more than 25% of the total revenue derived from tax increments paid by properties in the TIF District may be expended, through a development fund or otherwise, on activities outside of the TIF District but within the defined geographic area of the Project Area except to pay, or secure payment of, debt service on credit enhanced bonds. Revenue derived from tax increments paid by properties in the TIF District are considered to have been "spent" within the TIF District if such amounts are: DRAFT FOR MAY 3, 2021 PUBLIC HEARING 8 AGENDA PAGE 31 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 • actually paid to a third party for activities performed within the TIF District within five years after certification of the district; • used to pay bonds that were issued and sold to a third party, the proceeds of which are reasonably expected on the date of issuance to be spent within the later of the five-year period or a reasonable temporary period or are deposited in a reasonably required reserve or replacement fund. • used to make payments or reimbursements to a third party under binding contracts for activities performed within the TIF District, which were entered into within five years after certification of the district; or • used to reimburse a party for payment of eligible costs (including interest)incurred within five years from certification of the district. It is anticipated that all revenue derived from tax increments paid by properties in the TIF District will be spent or obligated within the first five years after certification of the TIF District and spent on Public Development Costs within the boundaries of the TIF District. SECTION 3.06 FINANCIAL REPORTING AND DISCLOSURE REQUIREMENTS The City will comply with the annual reporting requirements of the TIF Act pursuant to the guidelines of the Office of the State Auditor. Under current law, the City must prepare and submit a report on the TIF District on or before August 1 of each year. The City must also annually publish in a newspaper of general circulation in the City an annual statement for the TIF District, in the format as prescribed by the Office of the State Auditor. The reporting and disclosure requirements outlined in this section begin with the year a tax increment financing district is certified, and shall end in the year in which both the district has been decertified and all tax increments have been spent or returned to the County for redistribution. Failure to meet these requirements, as determined by the State Auditors Office, may result in suspension of distribution of tax increments. SECTION 3.07 BUSINESS SUBSIDY COMPLIANCE The City will comply with the business subsidy requirements specified in Minnesota Statutes, Sections 116J.993 to 116J.995, as amended. DRAFT FOR MAY 3, 2021 PUBLIC HEARING 9 AGENDA PAGE 32 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Exhibit I City of Albertville Tax Increment Financing District No. 19 Present Value Analysis As Required By Minnesota Statutes, Section 469.175, subdivision (3)(b)(2) Fehn Company Development 1 Estimated Future Market Value w/Tax Increment Financing 4,785,825 7 2 Payable 2021 Market Value 219,600 3 Market Value Increase (1-2) 4,566,225 4 Present Value of Future Tax Increments 1,450,334 5 Market Value Increase Less PV of Tax Increments 3,115,891 6 Estimated Future Market Value w/o Tax Increment Financing 281,622 7 7 Payable 2021 Market Value 219,600 8 Market Value Increase (6-7) 62,022 9 Increase in MV From TIF 3,053,869 2 1 Assume 7.00% annual appreciation over 26 year life of district. 2 Statutory compliance achieved if increase in market value from TIF(Line 9) is greater than or equal to zero. DRAFT FOR MAY 3, 2021 PUBLIC HEARING 10 AGENDA PAGE 33 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Exhibit II City of Albertville Tax Increment Financing District No.19(Redevelopment) Fehn Company Development Projected Tax Increment Cash Flow Taxable Less Base AvailableTIF for TIF Taxes Captured Tax Net Market Tax Tax z City Present Value(TMV) Capacity Capacity District Payable Tax Tax Rate Increment Admin Available 6 Year Year 16 4 Capacity a Financing 7 TIF Value (TIF)$ Costs 1 2024 187,761 3,005 (3,642) 134.723% 2 2025 3,391,338 65,577 (3,642) 61,935 134.723% 83,140 4,157 78,983 70,602 3 2026 3,425,252 66,255 (3,642) 62,613 134.723% 84,050 4,203 79,848 139,206 4 2027 3,459,504 66,940 (3,642) 63,298 134.723% 84,970 4,249 80,722 205,868 5 2028 3,494,099 67,632 (3,642) 63,990 134.723% 85,899 4,295 81,604 270,641 6 2029 3,575,363 69,026 (3,642) 65,384 134.723% 87,770 4,388 83,381 334,255 7 2030 3,961,419 75,994 (3,642) 72,352 134.723% 97,124 4,856 92,268 401,916 8 2031 4,001,033 76,784 (3,642) 73,142 134.723% 98,185 4,909 93,276 467,660 9 2032 4,041,043 77,582 (3,642) 73,940 134.723% 99,255 4,963 94,293 531,539 10 2033 4,081,454 78,388 (3,642) 74,746 134.723% 100,337 5,017 95,321 593,608 11 2034 4,122,268 79,202 (3,642) 75,560 134.723% 101,431 5,072 96,359 653,916 12 2035 4,163,491 80,024 (3,642) 76,382 134.723% 102,534 5,127 97,407 712,513 13 2036 4,205,126 80,854 (3,642) 77,212 134.723% 103,649 5,182 98,466 769,447 14 2037 4,247,177 81,693 (3,642) 78,051 134.723% 104,773 5,239 99,535 824,763 15 2038 4,289,649 82,540 (3,642) 78,898 134.723% 105,910 5,296 100,615 878,509 16 2039 4,332,545 83,395 (3,642) 79,753 134.723% 107,059 5,353 101,706 930,728 17 2040 4,375,871 84,259 (3,642) 80,617 134.723% 108,219 5,411 102,808 981,464 18 2041 4,419,629 85,132 (3,642) 81,490 134.723% 109,390 5,469 103,920 1,030,756 19 2042 4,463,826 86,013 (3,642) 82,371 134.723% 110,573 5,529 105,045 1,078,647 20 2043 4,508,464 86,903 (3,642) 83,261 134.723% 111,768 5,588 106,180 1,125,176 21 2044 4,553,549 87,802 (3,642) 84,160 134.723% 112,975 5,649 107,326 1,170,381 22 2045 4,599,084 88,710 (3,642) 85,068 134.723% 114,193 5,710 108,484 1,214,299 23 2046 4,645,075 89,627 (3,642) 85,985 134.723% 115,425 5,771 109,654 1,256,967 24 2047 4,691,526 90,553 (3,642) 86,911 134.723% 116,668 5,833 110,835 1,298,421 25 2048 4,738,441 91,489 (3,642) 87,847 134.723% 117,924 5,896 112,028 1,338,693 26 2049 4,785,825 92,434 (3,642) 88,792 134.723% 119,192 5,960 113,233 1,377,817 TOTAL= 2,582,415 129,121 2,453,294 1,377,817 Assumptions: 1 Taxable market value(TMV)annual growth assumption=1.00% 2 Original Tax Capacity Rate estimated based on Taxes Payable Year 2021. 3 Election for captured tax capacity is 100.00% 4 Base Tax Capacity calculated based on a TMV=$219,600.The TIF District will include 5.45 acres classified as Residential Full Homestead for Pay 2021. 5 Present value is calculated based on semi-annual payments,4.0%rate,and date of 1/1/2023. 6 TMV is based on preliminary estimated valuation,based on phasing,informed by input from the County Assessor. Assumes City elects year 2024 as first year for tax increment. 7 City retains 5%of the TIF for City administration costs. 8 Available TIF after State Fee is calculated based captured tax increments less State Auditor Fee of 0.36%. DRAFT FOR MAY 3, 2021 PUBLIC HEARING 11 AGENDA PAGE 34 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Exhibit III City of Albertville Tax Increment Financing District No. 19 Impact on Other Taxing Jurisdictions (Taxes Payable 2021) Fehn Company Development Annual Tax Increment Estimated Annual Captured Tax Capacity(Full Development) $92,434 Payable 2021 Local Tax Rate 134.723% Estimated Annual Tax Increment $124,S30 Percent of Tax Base Net Tax Captured Percent of Capacity Tax Total NTC (NTC) a Capacity City of Albertville 9,224,487 92,434 1.00% Wright County 188,43S,241 92,434 0.05% ISD 88S 26,S92,918 92,434 0.35% Dollar Impact of Affected Taxing Jurisdictions Net Tax Tax Capacity %of Total Increment Added Local Tax Rate (NTC) Share City of Albertville 46.801% 34.739% 43,260 0.469% Wright County 43.717% 32AS0% 40,409 0.021% ISD 88S 44.20S% 32.812% 40,860 0.1 S4% Other 0.000% 0.000% 0 Totals 134.723% 100.000% 124,S29 NOTE NO. 7: Assuming that ALL of the captured tax capacity would be available to all taxing jurisdictions even if the City does not create the Tax Increment District the creation of the District will reduce tax capacities and increase the focal tax rate as illustrated in the above tables. NOTE NO. 2: Assuming that NONE of the captured tax capacity would be available to the taxing jurisdiction if the City did not create the Tax Increment District then the plan has virtually no initial effect on the tax capacities of the taxing jurisdictions. However, once the TIF District is established, allowable costs paid from the increments, and the TIF District is terminated, all taxing jurisdictions will experience an increase in their tax base. DRAFT FOR MAY 3, 2021 PUBLIC HEARING 12 AGENDA PAGE 35 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Exhibit IV City of Albertville Tax Increment Financing (Redevelopment) District No. 19 Fehn Company Development Estimated Tax Increments Over Maximum Life of District Based on Pay 2027 Tax Rate= 734.723% 46.807% 43.717916 44.205% 0.000% School New Estimated City County District Other TIF Taxes Taxable New Base Captured Total Tax TIF TIF TIF TIF District Payable Market Tax Tax Tax Increment Related Related Related Related Year Year Value Capacity Capacity Capacity (TIF) Share Share Share Share 1 2024 187,761 3,005 3,642 - - - - - 2 2025 3,391,338 65,577 3,642 61,935 83,440 28,986 27,076 27,378 3 2026 3,425,252 66,255 3,642 62,613 84,354 29,304 27,373 27,678 - 4 2027 3,459,504 66,940 3,642 63,298 85,277 29,624 27,672 27,981 - 5 2028 3,494,099 67,632 3,642 63,990 86,209 29,948 27,975 28,287 - 6 2029 3,575,363 69,026 3,642 65,384 88,087 30,600 28,584 28,903 - 7 2030 3,961,419 75,994 3,642 72,352 97,475 33,862 31,630 31,983 - 8 2031 4,001,033 76,784 3,642 73,142 98,540 34,231 31,976 32,333 - 9 2032 4,041,043 77,582 3,642 73,940 99,614 34,605 32,324 32,685 - 10 2033 4,081,454 78,388 3,642 74,746 100,700 34,982 32,677 33,041 - 11 2034 4,122,268 79,202 3,642 75,560 101,797 35,363 33,033 33,401 - 12 2035 4,163,491 80,024 3,642 76,382 102,904 35,748 33,392 33,765 - 13 2036 4,205,126 80,854 3,642 77,212 104,023 36,136 33,755 34,132 - 14 2037 4,247,177 81,693 3,642 78,051 105,152 36,529 34,121 34,502 - 15 2038 4,289,649 82,540 3,642 78,898 106,293 36,925 34,492 34,877 - 16 2039 4,332,545 83,395 3,642 79,753 107,446 37,325 34,866 35,255 - 17 2040 4,375,871 84,259 3,642 80,617 108,610 37,730 35,243 35,637 - 18 2041 4,419,629 85,132 3,642 81,490 109,785 38,138 35,625 36,022 - 19 2042 4,463,826 86,013 3,642 82,371 110,973 38,550 36,010 36,412 - 20 2043 4,508,464 86,903 3,642 83,261 112,172 38,967 36,399 36,806 - 21 2044 4,553,549 87,802 3,642 84,160 113,383 39,388 36,792 37,203 - 22 2045 4,599,084 88,710 3,642 85,068 114,606 39,813 37,189 37,604 - 23 2046 4,645,075 89,627 3,642 85,985 115,842 40,242 37,590 38,010 - 24 2047 4,691,526 90,553 3,642 86,911 117,090 40,675 37,995 38,419 - 25 2048 4,738,441 91,489 3,642 87,847 118,350 41,113 38,404 38,833 - 26 2049 4,785,825 92,434 3,642 88,792 119,623 41,555 38,817 39,250 - Total 2,591,745 900,339 841,010 850,397 - Note: The Estimated Total Tax Increment shown above is before deducting the State Auditor's fee,which is payable at a rate of 0.36%of the Total Tax Increment collected. Exhibit II provides Estimated Total Tax Increment after deducting for the State Auditor's fee. DRAFT FOR MAY 3, 2021 PUBLIC HEARING 13 AGENDA PAGE 36 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Exhibit V Map of Boundaries of Tax Increment Financing District No. 19 and Municipal Development District No. 1 (Boundaries of Municipal District No. 1 are coterminous with the municipal boundaries of the City of Albertville) $�\ KAHL KACAN s �KARN •` iyVOCD — KAHLER � n ANT, 2 o a b'N� 64T H m�J x x I �y /�O�'yAQO KAHL L,K9Mq v,,..� yp.W-E R, A � 3✓ _� � m KAHLER I I /fq��Y � KALENoq= ,y �� ja351tlN �' I q L�LLI � ��FNp9 2 C1 ' IA KALL�AND (A Kg4L4 �� ; ONV"I"ItM � PRIVATE KVLER 4 Ggyp o 0 ,�NATE Y LAC ENTj�F o m m yPKE704y,YF I 4 LNWOOD 3 Ig N LACHMAN 9 A e �BIEIRT yT �y0 L:P,I(E � � N N p. L�ANDJER Z 2 0 m � m IµII}I}T}�{IF� O LANDER ;c� 3a�4�sr Y N � J L_NI��III� �11U �\ 7 y1� �Y'M'� 0 39ad�• Rv ssi LARGE: RGEto [ 1 N LAKE LARGE 2 ;$ � D NON I(h() Y ggRh1EL WDUgj� Ym -d� O n row 'N ,�I LVMON •.�..�.. ..�..�..�.. OT MACKENZIE �N O MAR OWE n. fo II 1 t� ! t2 1 C a� 1 1 O •>•j m X - M 0 O n m ' � � N TN - • o N _ N D rt M �• z C W 0 m z (D N O C N 0 'z z M o � rt DRAFT FOR MAY 3, 2021 PUBLIC HEARING 14 AGENDA PAGE 37 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Exhibit VI Inspection Report of Property DRAFT FOR MAY 3, 2021 PUBLIC HEARING 15 AGENDA PAGE 38 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 REPORT OF INSPECTION PROCEDURES AND RESULTS FOR DETERMINING QUALIFICATIONS OF A TAX INCREMENT FINANCING DISTRICT AS A REDEVELOPMENT DISTRICT ALBERTVILLE 50TH STREET NORTHEAST TIF DISTRICT ALBERTVILLE, MINNESOTA ,r 1 March 30,2021 Prepared by: LHB,Inc. 701 Washington Avenue North,Suite 200 It Prepared for the Minneapolis,Minnesota 55401 CITY OF ALBERTVILLE LHB Project No.210197 DRAFT FOR MAY 3, 2021 PUBLIC HEARING 16 AGENDA PAGE 39 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Table of Contents Part1: Executive Summary......................................................................................................................................2 Purposeof the Evaluation........................................................................................................................................................2 Scopeof Work.........................................................................................................................................................................2 Conclusion...............................................................................................................................................................................3 Part 2: Minnesota Statute 469.174, Subdivision 10 Requirements.......................................................................3 InteriorInspection....................................................................................................................................................................3 Exterior Inspection and Other Means......................................................................................................................................3 Documentation.........................................................................................................................................................................3 QualificationRequirements......................................................................................................................................................3 1.Coverage Test....................................................................................................................................................................3 2.Condition of Buildings Test.................................................................................................................................................4 3. Distribution of Substandard Buildings.................................................................................................................................4 Part 3: Procedures Followed....................................................................................................................................5 Part4: Findings.........................................................................................................................................................5 1.Coverage Test.....................................................................................................................................................................5 2.Condition of Building Test....................................................................................................................................................6 3. Distribution of Substandard Structures................................................................................................................................8 Part5: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 Albertville 501h Street Northeast TIF District LHB Project No.210197 Page 1 of 9 Final Report DRAFT FOR MAY 3, 2021 PUBLIC HEARING 17 AGENDA PAGE 40 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Part 1 : Executive Summary Purpose of the Evaluation LHB was hired by the City of Albertville to inspect and evaluate the properties within a Tax Increment Financing Redevelopment District("TIF District")proposed to be established by the City. The proposed TIF District is located near the northeast corner of 50th Street Northeast and Barthel Industrial Drive Northeast(Diagram 1). The purpose of LHB's work is to determine whether the proposed TIF District meets the statutory requirements for coverage,and whether one(1)building on one(1)parcel,located within the proposed TIF District, meet the qualifications required for a Redevelopment District. UM .-50th Street Northeast I i Diagram 1:Proposed TIF District Scope of Work The proposed TIF District consists of one(1)parcel with one(1)building. One(1)building was inspected on March 5,2021. A Building Code and Condition Deficiency Report for the building that was inspected and found substandard is located in Appendix B. Albertville 501h Street Northeast TIF District LHB Project No.210197 Page 2 of 9 Final Report DRAFT FOR MAY 3, 2021 PUBLIC HEARING 18 AGENDA PAGE 41 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Conclusion After inspecting and evaluating the property 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 "The municipality may not make such determination[that the building is structurally substandard]without an interior inspection of the property..." Exterior Inspection and Other Means "An 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." Documentation "Written 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)." 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: "parcels consisting of 70 percent of the area of the district are occupied by buildings,streets, utilities,or paved or gravel parking lots..." b. The coverage required by the parcel to be considered occupied is defined under Minnesota Statutes,Section 469.174, Subdivision 10(e),which states: "For 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." Albertville 50th Street Northeast TIF District LHB Project No.210197 Page 3 of 9 Final Report DRAFT FOR MAY 3, 2021 PUBLIC HEARING 19 AGENDA PAGE 42 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 2.CONDITION OF BUILDINGS TEST a. Minnesota Statutes,Section 469.174, Subdivision 10(a)states: "...and more than 50 percent of the buildings,not including outbuildings,are structurally substandard to a degree requiring substantial renovation or clearance;' b. Structurally substandard is defined under Minnesota Statutes,Section 469.174, Subdivision 10(b),which states: "For purposes of this subdivision, `structurally substandard'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." i. We do not count energy code deficiencies toward the thresholds required by Minnesota Statutes, Section 469.174,Subdivision 10(b)defined as"structurally substandard",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: "A 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 structural repairs,or other similar reliable evidence." "Items 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 of deterioration,or other similar reliable evidence." 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 of ten building code areas highlighted by the Minnesota Department of Labor and Industry website where minimum construction standards are required by law. 2) Chapter 11 of the 2015 Minnesota Residential Code incorporates Minnesota Rules, Chapters, 1322 and 1323 Minnesota Energy Code. 3) 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. 4) 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. 5) 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. In order for an 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. 3. DISTRIBUTION OF SUBSTANDARD BUILDINGS a. Minnesota Statutes,Section 469.174, Subdivision 10,defines a Redevelopment District and requires one or more of the following conditions"reasonably distributed throughout the district.": 110) 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; Albertville 501h Street Northeast TIF District LHB Project No.210197 Page 4 of 9 Final Report DRAFT FOR MAY 3, 2021 PUBLIC HEARING 20 AGENDA PAGE 43 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 (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 was for tank facilities..." 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 all of the 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)building during the day of March 5,2021. Part 4: Findings 1. Coverage Test a. The total square foot area of the 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. FINDING The proposed TI F 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 TI F District under Minnesota Statutes,Section 469.174, Subdivision(a)(1). Albertville 501h Street Northeast TIF District LHB Project No.210197 Page 5 of 9 Final Report DRAFT FOR MAY 3, 2021 PUBLIC HEARING 21 AGENDA PAGE 44 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 ' J 1 i r r " Diagram 2—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 whether or not a building"appears"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 2021. Albertville 501h Street Northeast TIF District LHB Project No.210197 Page 6 of 9 Final Report DRAFT FOR MAY 3, 2021 PUBLIC HEARING 22 AGENDA PAGE 45 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 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 Albertville, Minnesota. iii. Replacement cost includes labor, materials,and the contractor's overhead and profit. Replacement costs do not include architectural fees,legal fees or other"soft"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 actually 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 2021; 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)building(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"structurally substandard"under Minnesota Statutes, Section 469.174,Subdivision 10(b),the building's defects or deficiencies should be of sufficient total significance to justify"substantial renovation or clearance." Based on this definition, LHB re-evaluated each of the buildings that met the code deficiency threshold under Minnesota Statutes, Section 469.174, Subdivision 10(c),to determine if the total deficiencies warranted"substantial renovation or clearance"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"service life"used up for a particular component unless it was an obvious part of that component's deficiencies. iv. After identifying the system condition deficiencies in each building,we used our professional judgment to determine if the list of defects or deficiencies is of sufficient total significance to justify"substantial renovation or clearance." FINDING In our professional opinion,one(1)out of one(1)building(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 Albertville 50th Street Northeast TIF District LHB Project No.210197 Page 7 of 9 Final Report DRAFT FOR MAY 3, 2021 PUBLIC HEARING 23 AGENDA PAGE 46 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 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 look at 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. r� eaSt >r 1treet 0 Diagram 3—Substandard Buildings Shaded green area depicts parcels with buildings. Shaded orange area depicts substandard buildings. Albertville 50th Street Northeast TIF District LHB Project No.210197 Page 8 of 9 Final Report DRAFT FOR MAY 3, 2021 PUBLIC HEARING 24 AGENDA PAGE 47 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Part 5: Team Credentials Michael A. Fischer, AIA, LEED AP- Project Principal/TIF Analyst Michael has 33 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 master's 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 council and Secretary of the Edina HRA. Michael has also managed and designed several award-winning architectural projects and was one of four architects in the Country to receive the AIA Young Architects Citation in 1997. Philip Waugh — Project Manager/TIF Analyst Philip is a project manager with 13 years of experience in historic preservation,building investigations, material research,and construction methods. He previously worked as a historic preservationist and also served as the preservation specialist at the St. Paul Heritage Preservation Commission. Currently, Phil sits on the Board of Directors for the Preservation Alliance of Minnesota. His current responsibilities include project management of historic preservation projects, performing building condition surveys and analysis,TIF analysis,writing preservation specifications, historic design reviews,writing Historic Preservation Tax Credit applications,preservation planning,and grant writing. Phil Fisher—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 Albertville 501h Street Northeast TIF District LHB Project No.210197 Page 9 of 9 Final Report DRAFT FOR MAY 3, 2021 PUBLIC HEARING 25 AGENDA PAGE 48 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 APPENDIX A Property Condition Assessment Summary Sheet DRAFT FOR MAY 3, 2021 PUBLIC HEARING 26 AGENDA PAGE 49 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 � D O o n > ( a cu � O Q — o COD+ o N s m co c v Z - � O CD _ v rt m � 0 m c� 0 m m - m - m - Z3 m a - m m 0 c c m' m x m _ n m - a m 0 m a � m o n - m _ o cm 52' c 52. n m m c � _ m - m � o = n - c _ m c - D_ m � G 3 _(D 3 � 3 (D y ' O v DRAFT FOR MAY 3, 2021 PUBLIC HEARING 27 AGENDA PAGE 50 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 APPENDIX B Building Code,Condition Deficiency and Context Analysis Reports DRAFT FOR MAY 3, 2021 PUBLIC HEARING 28 AGENDA PAGE 51 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Albertville 50th Street Northeast TIF District Building Code, Condition Deficiency and Context Analysis Report Parcel A Residential Dwelling Address: 12074 50th Street NE,Albertville, MN 55301 Parcel ID: 101800063301 Inspection Date(s)&Time(s): March 5,2021 3:00 PM 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: $211,961 Estimated Cost to Correct Building Code Deficiencies: $42,758 Percentage of Replacement Cost for Building Code Deficiencies: 20.2% DEFECTS IN STRUCTURAL ELEMENTS 1. There is significant cracking in the concrete slab. 2. Foundation block is separating,allowing for water intrusion,contrary to code. COMBINATION OF DEFICIENCIES 1. Essential Utilities and Facilities a. None observed. 2. Light and Ventilation a. The domestic cooking exhaust does not comply with code. b. The electrical wiring system is not fully code compliant. c. The HVAC system does not comply with code. 3. Fire Protection/Adequate Egress a. The basement stairway is not code compliant. b. Smoke detectors are not code compliant. c. There are no code required Ground Fault Circuit Interrupters in the building. d. There are no code required Arc Fault Circuit Interrupters in the building. e. There are no code required carbon monoxide detectors in the building. Albertville 50th Street Northeast TIF District Page 1 of 3 Building Report LHB Project No.210197 Parcel A-12074 50th Street NE DRAFT FOR MAY 3, 2021 PUBLIC HEARING 29 AGENDA PAGE 52 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 4. Layout and Condition of Interior Partitions/Materials a. Carpeting should be replaced. b. Interior walls should be patched and repainted. c. Ceilings should be repainted. d. There are water stains in the bathroom ceiling from roof leaks. e. Basement ceiling panels should be reattached. f. There are no code required hold down fasteners between top plate and roof trusses. g. Transition from main house to addition is not code compliant. 5. Exterior Construction a. Exterior landscaping allows for water intrusion into basement,which is contrary to code. b. Exterior foundation walls are not waterproofed per code. c. Exterior siding is damaged,allowing for water intrusion,contrary to code. d. Exterior windows do not have top flashing per code. e. Exterior window trim is rotting,allowing for water intrusion,contrary to code. f. The roofing material is failing,allowing for water intrusion,contrary to code. g. Exterior wood surfaces should be repainted. h. Caulking is failing,allowing for water intrusion,contrary to code. DESCRIPTION OF CODE DEFICIENCIES 1. Foundation block should be repaired to prevent water intrusion per code. 2. The domestic cooking exhaust should be installed per code. 3. The electrical wiring system is not fully code compliant. 4. The HVAC system does not comply with code. 5. The basement stairway is not code compliant. 6. There are no code compliant smoke detectors. 7. There are no code required Ground Fault Circuit Interrupters. 8. There are no code required Arc Fault Circuit Interrupters. 9. There are no code required carbon monoxide detectors. 10. Code required hold down fasteners should be installed between top plate and roof trusses. 11. The transition from the main house to the addition is not code compliant. 12. Exterior landscaping should be modified to move water away from the foundation per code. 13. Code required water proofing should be applied. 14. Repair exterior siding to prevent water intrusion per code. 15. Install code required drip flashing over windows. 16. Replace rotting wood trim around windows to prevent water intrusion per code. 17. Replace failing roofing material to prevent water intrusion per code. 18. Replace failed caulking to prevent water intrusion per code. Albertville 50th Street Northeast TIF District Page 2 of 3 Building Report LHB Project No.210197 Parcel A-12074 50th Street NE DRAFT FOR MAY 3, 2021 PUBLIC HEARING 30 AGENDA PAGE 53 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 OVERVIEW OF DEFICIENCIES This residential dwelling was built in 1973. The interior walls and ceilings should be repaired and repainted. Carpeting in the basement should be replaced. Electrical wiring is not fully code compliant. There are no code required GFCI's or AFCI's in the house. The kitchen exhaust is not code compliant. Code compliant smoke and carbon monoxide detectors should be installed. The basement stairway is not code compliant. The HVAC system is not code compliant. Exterior landscaping should be modified to direct water away from foundation to prevent water intrusion per code. Damaged foundation wall should be repaired to prevent water intrusion per code. Code required waterproofing should be installed around foundation wall. Exterior siding should be repaired,code required flashing should be installed on top of windows,failed roofing material should be replaced,and failed caulking should be replaced to prevent water intrusion per code. Code required metal fasteners should be installed connecting top plate to roof trusses. KO Proj\210197\300 Design\Reports\Building Reports\12074 50th Street NE Building Report.docx Albertville 50th Street Northeast TIF District Page 3 of 3 Building Report LHB Project No.210197 Parcel A-12074 50th Street NE DRAFT FOR MAY 3, 2021 PUBLIC HEARING 31 AGENDA PAGE 54 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 APPENDIX C Building Replacement Cost Reports Code Deficiency Cost Reports Photographs DRAFT FOR MAY 3, 2021 PUBLIC HEARING 32 AGENDA PAGE 55 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Albertville 50th Street Northeast TIF District Replacement Cost Report FtSrM„ans data Square Foot Cost Estimate Report Date: 3/5/2021 12074 50th Street NE Building Type: Economy 1 Story with Wood Siding-Wood Frame Location: MINNEAPOLIS,MN � Story Count: 1 '' Story Height(L.F.): 8.00 Floor Area(S.F.): 1440 Labor Type: RES - Basement: Finished Data Release: Year 2021 Quarter 1 Costs are derived from building model with basic components. Cost Per Square Foot: $147.20 Scope differences and market conditions can cause costs to vary signi5cantly. Building Cost: $211,961.55 %of Total Cost Per S.F. Cost 0104034 Footing excavation,building,26'x 46',4'deep $2.35 $3,385.75 iFoundation 0204030 Footing systems, 10"thick by 20"wide footing $2.70 $3,881.96 0208034 Block wall systems,8"wall,grouted,full height $8.97 $12,916.19 0208034 Block wall systems,8"wall,grouted,full height $7.85 $11,301.67 0220034 Floor slab systems,4"thick slab $4.80 $6,913.50 0302106 Floor framing,wood joists,#2 or better,pine,2"x 8", 16" $2.83 $4,080.51 0302112 Floor framing,bridging,wood 1"x 3",joists 16"OC $0.44 $633.20 0302119 Box sills,#2 or better pine,2"x 8" $0.43 $615.54 0302123 Girders,including lally columns,3 pieces spiked together, $2.15 $3,094.76 0308026 Exterior wall framing systems,2"x 4", 16"OC $0.47 $683.56 0308026 Exterior wall framing systems,2"x 4", 16"OC $5.01 $7,214.76 0316042 Truss roof framing systems,24"OC,4/12 pitch, 1' $8.99 $12,942.65 0348026 Partition framing systems,2"x 4", 16"OC $2.91 $4,194.36 Exterior Walls 0402152 Painting,2 coats $1.06 $1,529.02 0416042 Metal&plastic siding systems,vinyl clapboard siding,8" $7.28 $10,483.20 0420043 Non-rigid insul, batts,fbgls,kraft faced,3-1/2"thick,R13, $0.70 $1,010.69 0420051 Non-rigid insul, batts,fbgls,kraft faced, 12"thick,R38,23" $1.67 $2,398.28 0440026 Sliding window systems,builder's quality wood window,3' $5.89 $8,484.38 0452046 Door systems,solid core birch,flush,3'x 6'-8" $2.05 $2,957.27 0460025 Storm door,al,combination,storm&screen,anodized,3'- $0.61 $882.53 0504034 Gable end roofing,asphalt,roof shingles,class A $5.67 $8,166.05 Albertville 50th Street Northeast TIF District Replacement Cost Report LHB Project No.210197 Page 1 of 2 Parcel A-12074 50th Street NE DRAFT FOR MAY 3, 2021 PUBLIC HEARING 33 AGENDA PAGE 56 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 iInteriors 0604026 Wall system, 1/2"drywall,taped&finished $7.12 $10,256.52 0604026 Wall system, 1/2"drywall,taped&finished $2.79 $4,011.44 0608026 1/2"gypsum wallboard,taped&finished ceilings $2.86 $4,122.85 0618034 Suspended ceiling 2'x 4'grid,film faced fiberglass,5/8" $7.11 $10,242.36 0620026 Lauan,flush door,hollow core,interior $7.36 $10,605.34 0660038 Underlayment plywood, 1/2"thick $2.82 $4,062.76 0664029 Resilient flooring,vinyl sheet goods,backed,.070"thick, $1.46 $2,100.79 0664048 Resilient flooring,sleepers,treated, 16"OC,1"x 3" $1.39 $2,002.80 0690046 Stairways 14 risers,pine treads,box stairs $1.92 $2,761.64 iSpecialtiesii 0708026 Kitchen,economy grade $1.98 $2,848.34 0712035 Sinks,stainless steel,single bowl 16"x 20" $1.28 $1,837.38 0712039 Water heater,electric,30 gallon $1.15 $1,649.28 isMechanical 0812046 Three fixture bathroom with wall hung lavatory $3.06 $4,401.39 0860101 Furnace,gas heating only,100 MBH,area to 1200 SF $0.89 $1,284.46 0860109 Intermittent pilot,100 MBH furnace $0.32 $466.40 0860111 Supply duct,rectangular,area to 1200 SF,rigid fiberglass $0.88 $1,273.45 0860121 Return duct,sheet metal galvanized,to 1500 SF $1.08 $1,555.51 0860123 Lateral ducts,flexible round 6"insulated,to 1200 SF $1.03 $1,487.33 0860135 Register elbows,to 1500 SF $0.54 $784.18 0860137 Floor registers,enameled steel w/damper,to 1500 SF $0.41 $588.17 0860139 Return air grille,area to 1500 SF 12"x 12" $0.11 $162.09 0860143 Thermostat,manual, 1 set back $0.09 $134.10 0860147 Plenum,heating only, 100 MBH $0.13 $185.44 Electrical 0910036 100 amp electric service $0.98 $1,417.91 0930018 Duplex receptacles using non-metallic sheathed cable $1.78 $2,562.20 0935112 Wiring device systems,economy to 1200 S.F. $2.03 $2,927.35 0945112 Light fixture systems,economy to 1200 S.F. $0.56 $813.08 SubTotal 100% $128.00 $184,314.39 Contractor Fees(General Conditions,Ove rhead,Profit) 15.0% $19.20 $27,647.16 Architectural Fees 0.0% $0.00 $0.00 User Fees 0.0% $0.00 $0.00 Albertville 50th Street Northeast TIF District Replacement Cost Report LHB Project No.210197 Page 2 of 2 Parcel A-12074 50th Street NE DRAFT FOR MAY 3, 2021 PUBLIC HEARING 34 AGENDA PAGE 57 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Albertville 50th Street Northeast TIF District Code Deficiency Cost Report Parcel A-12074 50th Street NE,Albertville, MN 55301 Residential Dwelling Parcel ID 101800063301 Code Related Cost Items r Unit Cost Unit U Accessibility Items Structural Elements Foundation Block Repair cracked foundation block to prevent water intrusion per code $ 1,000.00 Lump 1 $ 1,000.00 Exiting Stairway Modify basement stairway to comply with code $ 1.92 SF 1,440 $ 2,764.80 Transition From Main House to Addition Modify transition from main house to addition to comply with code $ 1,000.00 Lump 1 $ 1,000.00 Fire Protection Smoke Detectors Install code compliant smoke detectors $ 125.00 EA 4 $ 500.00 Carbon Monoxide Detectors Install code required carbon monoxide detectors $ 125.00 EA 3 $ 375.00 Ground Fault Circuit Interrupters Install code required GFCI's $ 125.00 EA 4 $ 500.00 Arc Fault Circuit Interrupters Install code required AFCI's $ 125.00 EA 5 $ 625.00 Exterior Construction Exterior Landscaping Modify exterior landscaping to prevent water intrusion per code $2,500.00 Lump 1 $ 2,500.00 Water Proofing Install code required water proofing on foundation $ 5.00 SF 900 $ 4,500.00 Exterior Siding Repair exterior siding to prevent water intrusion per code $ 1,000.00 Lump 1 $ 1,000.00 Flashing Install code required drip tlasning over exterior windows to prevent water intrusion $ 0.55 SF 1,440 $ 792.00 Window Trim Keplace rotting wood trim around windows to prevent water intrusion percode $ 0.35 SF 1,440 $ 504.00 Caulking Replace failed caulking to prevent water intrusion per code $ 0.25 Lump 1,440 $ 360.00 Albertville 50th Street Northeast TIF District Code Deficiency Cost Report LHB Project No.210197 Page 1 of 2 Parcel A-12074 50th Street NE DRAFT FOR MAY 3, 2021 PUBLIC HEARING 35 AGENDA PAGE 58 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Code Related Cost Items 91 r Unit Cost Unit Units Roof Construction Roof Trusses Install code required metal fasteners between top plate and trusses $ 1.00 SF 1,440 $ 1,440.00 Roofing Material Remove failed roofing material $ 0.45 SF 1,440 $ 648.00 Install roofing material to prevent water intrusion per code $ 5.67 SF 1,440 $ 8,164.80 Mechanical- Electrical Mechanical Install code compliant kitchen exhaust $ 0.90 SF 1,440 $ 1,296.00 Install code compliant HVAC system $ 5.48 SF 1,440 $ 7,891.20 Electrical Install code compliant electrical wiring $ 4.79 SF 1,440 $ 6,897.60 Total Code Improvements $ 42,758 Albertville 50th Street Northeast TIF District Code Deficiency Cost Report LHB Project No.210197 Page 2 of 2 Parcel A-12074 50th Street NE DRAFT FOR MAY 3, 2021 PUBLIC HEARING 36 AGENDA PAGE 59 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Albertville 5Oth Street Northeast TIF District - Parcel A Photos r� ;Los- ii,i& 'm 12083 50th St NE-Google Maps 20210305_144820 20210305_ 20210305_144839 20210305_144854 20210305_ 20210305_144921 20210305_144930 20210305_ DRAFT FOR MAY 3, 2021 PUBLIC HEARING 37 AGENDA PAGE 60 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Albertville 50th Street Northeast TIF District - Parcel A Photos 20210305_145001 20210305_145004 20210305_145018 20210305_145043 20210305_145051 20210305_145107 20210305_145117 20210305_145132 20210305_145139 20210305_145142 20210305_145144 20210305_145148 2 DRAFT FOR MAY 3, 2021 PUBLIC HEARING 38 AGENDA PAGE 61 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Albertville 50th Street Northeast TIF District - Parcel A Photos t 20210305_145151 20210305_145209 20210305_145218 i s 20210305_145224 20210305_145248 20210305_145250 20210305_145306 20210305_145308 20210305_145320 � s PU 20210305_145339 20210305_145343 20210305_145355 3 DRAFT FOR MAY 3, 2021 PUBLIC HEARING 39 AGENDA PAGE 62 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Albertville 50th Street Northeast TIF District - Parcel A Photos PU 20210305_145358 20210305_145412 20210305_145446 R i 'i 20210305_145449 20210305_145454 20210305_145506 20210305_145559 20210305_150015 20210305_150145 t^ r m 20210305_150152 20210305_150229 20210305_150239 4 DRAFT FOR MAY 3, 2021 PUBLIC HEARING 40 AGENDA PAGE 63 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Albertville 50th Street Northeast TIF District - Parcel A Photos 20210305_150254 20210305_150307 20210305_150333 20210305_150413 20210305_150456 20210305_150458 i h 20210305_150524 20210305_150528 20210305_150530 T` �} 20210305_150542 20210305_150548 20210305_150554 5 DRAFT FOR MAY 3, 2021 PUBLIC HEARING 41 AGENDA PAGE 64 TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 Albertville 50th Street Northeast TIF District - Parcel A Photos 20210305_150601 20210305_150625 20210305_150723 - Ito 20210305_150729 20210305_151103 20210305_151122 6 DRAFT FOR MAY 3, 2021 PUBLIC HEARING 42 AGENDA PAGE 65 Fourth draft, May 12, 2021 CONTRACT FOR PRIVATE REDEVELOPMENT By and Between CITY OF ALBERTVILLE, MINNESOTA and HUNTER LAND COMPANY,LLC And FEHN COMPANIES,INCORPORATED Dated as of: , 2021 This document was drafted by: KENNEDY& GRAVEN, Chartered (MNI) 150 South 5th Street, Suite 700 Minneapolis, Minnesota 55402 Telephone: 337-9300 AGENDA PAGE 66 AL 141\71\711642.v4 TABLE OF CONTENTS Page PREAMBLE ............................................................................................................................. 1 ARTICLE I Definitions Section1.1. Definitions...........................................................................................................2 ARTICLE II Representations and Warranties Section 2.1. Representations by the City................................................................................5 Section 2.2. Representations and Warranties by the Redeveloper..........................................5 Section 2.3. Representations and Warranties by the Tenant...................................................6 ARTICLE III Public Redevelopment Costs; Issuance of Note Section 3.1. Status of Redevelopment Property......................................................................7 Section 3.2. Environmental Conditions..................................................................................7 Section 3.2. Public Redevelopment Costs ..............................................................................7 Section 3.2. Issuance of Note..................................................................................................8 Section 3.5. Payment of Administrative Costs .......................................................................8 Section3.6. Records ...............................................................................................................9 Section 3.7. Business Subsidy Agreement..............................................................................9 ARTICLE IV Construction of Minimum Improvements Section 4.1. Construction of Minimum Improvements ........................................................ 12 Section 4.2. Construction Plans............................................................................................ 12 Section 4.3. Commencement and Completion of Construction............................................ 13 Section 4.4. Certificate of Completion ................................................................................. 13 ARTICLE V Insurance Section5.1. Insurance........................................................................................................... 15 Section5.2. Subordination.................................................................................................... 16 AGENDA1PAGE 67 AL 141\71\711642.v4 ARTICLE VI Delinquent Taxes and Review of Taxes Section 6.1. Right to Collect Delinquent Taxes.................................................................... 17 Section 6.2. Review of Taxes ............................................................................................... 17 ARTICLE VII Financing Section7.1. Financing........................................................................................................... 18 Section 7.2. City's Option to Cure Default on Mortgage..................................................... 18 Section 7.3. Subordination and Modification for the Benefit of Mortgagee........................ 18 ARTICLE VIII Prohibitions Against Assignment and Transfer; Indemnification Section 8.1. Representation as to Development.................................................................... 19 Section 8.2. Prohibition Against Redeveloper's Transfer of Property and Assignment of Agreement................................................................................ 19 Section 8.3. Release and Indemnification Covenants...........................................................20 ARTICLE IX Events of Default Section 9.1. Events of Default Defined ................................................................................22 Section 9.2. Remedies on Default.........................................................................................22 Section 9.3. No Remedy Exclusive.......................................................................................22 Section 9.4. No Additional Waiver Implied by One Waiver................................................23 ARTICLE X Additional Provisions Section 10.1. Conflict of Interests; City Representatives Not Individually Liable ................24 Section 10.2. Equal Employment Opportunity.......................................................................24 Section 10.3. Restrictions on Use...........................................................................................24 Section 10.4. Provisions Not Merged With Deed...................................................................24 Section 10.5. Titles of Articles and Sections..........................................................................24 Section 10.6. Notices and Demands .......................................................................................24 Section10.7. Counterparts......................................................................................................25 Section10.8. Recording..........................................................................................................25 Section10.9. Amendment.......................................................................................................25 Section10.10. City Approvals..................................................................................................25 Section 10.11. Termination.......................................................................................................25 Section 10.12. Choice of Law and Venue.................................................................................25 TESTIMONIUM ....................................................................................................................... S-1 AGENDAIPAGE 68 AL 141\71\711642.v4 SIGNATURES ......................................................................................................................... S-1 SCHEDULE A Description of Redevelopment Property SCHEDULE B Form of Authorizing Resolution SCHEDULE C Certificate of Completion (The remainder of this page is intentionally left blank.) AGENDkP'AGE 69 AL 141\71\711642.v4 CONTRACT FOR PRIVATE REDEVELOPMENT This Contract for Private Redevelopment is made as of the_day of , 2021, by and between THE CITY OF ALBERTVILLE, a Minnesota municipal corporation (the "City"), HUNTER LAND COMPANY, LLC, a Minnesota limited liability company (the "Redeveloper"), and FERN COMPANIES, INCORPORATED, a Minnesota corporation (the "Tenant"). WITNESSETH: WHEREAS, the City has undertaken a program to promote economic development and job opportunities and to promote the redevelopment of land which is underutilized within the City of Albertville (the "City"), and in this connection created Municipal Project No. 1 (the "Project") pursuant to Minnesota Statutes, Sections 469.124 to 469.134, as amended (the "Municipal Development Act") and approved a Development Program for the Project; and WHEREAS, pursuant to the Municipal Development Act, the City is authorized to undertake certain activities to facilitate the development or redevelopment of real property by private enterprise; and WHEREAS, the Developer proposes to acquire certain property in the Project (the "Redevelopment Property") and proposes to construct and develop approximately 49,200 square feet of storage, office, and shop space for the Tenant's operation of its earthwork and demolition services (the"Minimum Improvements") on the Redevelopment Property; and WHEREAS, the City has approved a Tax Increment Financing Plan for Tax Increment Financing (Redevelopment) District No. 19 (Fehn) (the "TIF District") pursuant to Minnesota Statutes, Sections 469.174 to 469.1794, as amended (the "Tax Increment Act"), made up of the Redevelopment Property; and WHEREAS, in order to achieve the objectives of the Development Program for the Project, the City is prepared to reimburse the Developer for certain site improvement and utility costs related to the Minimum Improvements in order to bring about development in accordance with the Development Program and this Agreement; and WHEREAS, the City believes that the development of the Redevelopment Property pursuant to this Agreement, and fulfillment generally of this Agreement, are in the vital and best interests of the City and the health, safety, morals, and welfare of its residents, and in accord with the public purposes and provisions of the applicable State and local laws and requirements under which the Project has been undertaken and is being assisted. NOW, THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows: AGENDAIPAGE 70 AL 141\71\711642.v4 ARTICLE I Definitions Section I.I. Definitions. In this Agreement, unless a different meaning clearly appears from the context: "Affiliate" means with respect to the Redeveloper (a) any corporation, partnership, limited liability company or other business entity or person controlling, controlled by or under common control with the Redeveloper; and (b) any successor to such party by merger, acquisition, reorganization or similar transaction involving all or substantially all of the assets of such party (or such Affiliate). For the purpose hereof, the words "controlling," "controlled by" and "under common control with" mean, with respect to any corporation, partnership, limited liability company or other business entity, the ownership of fifty percent (50%) or more of the voting interests in such entity possession, directly or indirectly, of the power to direct or cause the direction of management policies of such entity, whether ownership of voting securities or by contract or otherwise. "Agreement" means this Contract for Private Redevelopment, as the same may be from time to time modified, amended, or supplemented. "Authorizing Resolution" means the resolution of the City, substantially in the form set forth in Schedule B attached hereto, approving this Agreement and authorizing the issuance of the Note. "Business Subsidy Act" means Minnesota Statutes, Section 116J.993 to 116J.995, as amended. "Certificate of Completion" means the certification substantially in the form attached hereto as Schedule C and made a part hereof, provided to the Redeveloper, pursuant to Section 4.4 of this Agreement. "City" means the City of Albertville, Minnesota. "City Representative" means the City Administrator, or any person designated by the City Administrator to act as the City Representative for the purposes of this Agreement. "Construction Plans" means the plans, specifications, drawings and related documents on the construction work to be performed by the Redeveloper on the Redevelopment Property which (a) shall be as detailed as the plans, specifications, drawings and related documents which are submitted to the appropriate building officials of the City, and (b) shall include at least the following for each building: (1) site plan; (2) foundation plan; (3) floor plan for each floor; (4) elevations (all sides); (5) landscape plan; and (6) such other plans or supplements to the foregoing plans as the City may reasonably request to allow it to ascertain the nature and quality of the proposed construction work to the extent agreed by the Redeveloper. AGENDA-PAGE 71 AL 141\71\711642.v4 "County" means the County of Wright, Minnesota. "Development Plan" means the City's Development Plan for the Project, as amended, as made known to the Redeveloper. "Event of Default"has the meaning provided in Section 9.1 hereof. "Holder"means the owner of a Mortgage. "Maturity Date"means the date that the Note has been paid in full or terminated pursuant to its terms,whichever is earlier. "Minimum Improvements" means the construction by Redeveloper of approximately 49,200 square feet of storage, office, and shop space, comprising approximately 8,468 square feet of office space ("Office Phase I"), 33,000 square feet of unheated shop and storage space ("Shop Phase I"), 1,763 square feet of office expansion ("Office Phase II"), and 6,000 square feet of heated shop expansion ("Shop Phase II"), to be leased and used by Tenant to operate its earthwork and demolition services. "Mortgage" means any mortgage made by the Redeveloper or Tenant which is secured, in whole or in part, with the Redevelopment Property and which is a permitted encumbrance pursuant to the provisions of Article VIII of this Agreement. "Note" means a pay-as-you-go tax increment revenue note, substantially in the form set forth in EXHIBIT A of the Authorizing Resolution, to be delivered by the City to the Redeveloper in consideration for the Redeveloper's payment of Public Redevelopment Costs related to the Minimum Improvements. "Project"means the City's Municipal Development District No. 1. "Public Redevelopment Costs"has the meaning provided in Section 3.3 hereof. "Qualified Facility"has the meaning provided in Section 3.7(a)(6). "Redeveloper" means Hunter Land Company, LLC, a Minnesota limited liability company or its permitted successors and assigns. "Redevelopment Property" means the real property described in Schedule A of this Agreement. "State" means the State of Minnesota. "Tax Increment" means that portion of the real property taxes which is paid with respect to the Redevelopment Property and which is remitted to the City as tax increment pursuant to the Tax Increment Act. AGENDA3PAGE 72 AL 141\71\711642.v4 "Tax Increment Act" means the Tax Increment Financing Act, Minnesota Statutes, Sections 469.174 to 469.1794, as amended. "Tax Increment District" or "TIF District" means the City's Tax Increment Financing District No. 19 (Fehn). "Tax Increment Plan" or "TIF Plan" means the City's Tax Increment Financing Plan for Tax Increment Financing District No. 19 (Fehn), as approved by the City on May 3, 2021, and as it may be amended from time to time. "Tax Official" means any County assessor; County auditor; County or State board of equalization, the commissioner of revenue of the State, or any State or federal district court, the tax court of the State, or the State Supreme Court. "Tenant"means Fehn Companies, Incorporated, a Minnesota corporation, or its permitted successors and assigns, which will operate the Minimum Improvements following the construction of the Minimum Improvements by the Redeveloper. "Unavoidable Delays" means delays beyond the reasonable control of the party seeking to be excused as a result thereof which are the direct result of war, terrorism, strikes, other labor troubles, inclement weather, earthquakes, tornados, flooding, acts of God, 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 acts of any federal, state or local governmental unit (other than the City in exercising its rights under this Agreement) which directly result in delays. Unavoidable Delays shall not include delays caused by the Redeveloper's failure to exercise reasonable efforts to obtain permits or governmental approvals necessary to enable construction of the Minimum Improvements by the dates such approval and construction is required under Sections 4.2 and 4.3 of this Agreement. (The remainder of this page is intentionally left blank.) AGENDA4PAGE 73 AL 141\71\711642.v4 ARTICLE II Representations and Warranties Section 2.1. Representations by the City. The City makes the following representations as the basis for the undertaking on its part herein contained: (a) The City is a statutory city duly organized and existing under the laws of the State. Under the provisions of the Municipal Development Act, the City has the power to enter into this Agreement and carry out its obligations hereunder. (b) The activities of the City are undertaken to foster the development of certain real property which for a variety of reasons is presently underutilized, to prevent the emergence of blight, to create increased tax base and employment in the City, and to stimulate further development of the Project as a whole. (c) The Minimum Improvements conform with the permitted land uses allowed within the zoning classification of the Redevelopment Property. (d) The City will use its best efforts to facilitate development of the Minimum Improvements, including but not limited to cooperating with the Redeveloper in obtaining necessary administrative and land use approvals. Section 2.2. Representations and Warranties by the Redeveloper. The Redeveloper represents and warrants that: (a) The Redeveloper is a limited liability company duly organized and in good standing under the laws of the State, is not in violation of any provisions of its organizational documents or bylaws or, to the best of its knowledge, the laws of the State, is duly authorized to transact business within the State, has power to enter into this Agreement and has duly authorized the execution, delivery and performance of this Agreement by proper action of its members. (b) The Redeveloper will construct the Minimum Improvements in accordance with the terms of this Agreement, the Development Plan and all applicable local, state and federal laws, ordinances, and regulations (including, but not limited to, environmental, zoning, building code and public health laws and regulations). (c) The Redeveloper has received no actual notice or communication from any local, state or federal official that the activities of the Redeveloper on the Redevelopment Property may be or will be in violation of any environmental law or regulation (other than those notices or communications of which the City is aware). The Developer is aware of no facts the existence of which would cause the Development Property to be in violation of or give any person a valid claim under any local, state or federal environmental law, regulation or review procedure. AGENDA5PAGE 74 AL 141\71\711642.v4 (d) The Redeveloper will construct, or cause to be constructed, the Minimum Improvements in accordance with all applicable local, state or federal laws or regulations. (e) The Redeveloper will obtain or cause to be obtained, in a timely manner, all required permits, licenses and approvals, and will meet or cause to be satisfied, in a timely manner, all requirements of all applicable local, state and federal laws and regulations which must be obtained or met before the Minimum Improvements may be lawfully constructed. (f) 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 company restriction or any evidences 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. (g) The proposed development by the Redeveloper hereunder would not occur but for the tax increment financing assistance being provided by the City hereunder. (h) The Redeveloper is not currently in default under any business subsidy agreement with any grantor, as such terms are defined in the Business Subsidy Act. Section 2.3. Representations and Warranties by the Tenant. (a) The Tenant is a corporation, duly organized and in good standing under the laws of the State, is not in violation of any provisions of its articles of incorporation and bylaws, is duly authorized to transact business within the State, has power to enter into this Agreement and has duly authorized the execution, delivery and performance of this Agreement by proper action of its officers. (b) The Tenant will operate and maintain the Minimum Improvements in accordance with the terms of this Agreement and all applicable local, state and federal laws, ordinances, and regulations (including, but not limited to, environmental, zoning, building code, and public health laws and regulations). (c) 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 corporate restriction or any evidences of indebtedness, agreement or instrument of whatever nature to which the Tenant is now a party or by which it is bound, or constitutes a default under any of the foregoing, which default or breach might prevent the Tenant from performing its obligations under this Agreement. AGENDA6PAGE 75 AL 141\71\711642.v4 ARTICLE III Public Redevelopment Costs; Issuance of Note Section 3.1. Status of Redevelopment Property. (a) As of the date of this Agreement, the Redeveloper has entered into a purchase agreement to acquire the Redevelopment Property from third party. The City has no obligation to acquire the Redevelopment Property or any portion thereof. (b) The Redeveloper shall obtain all planning approvals necessary to construct the Minimum Improvements. In addition, and as provided in Section 4.2 hereof, the Redeveloper shall prepare its Construction Plans to meet the standards as required by the City. (c) The Redeveloper and the City shall enter into a Planned Unit Development Agreement, Fehn Industrial Park (the "PUD Agreement") for the Redevelopment Property concurrently with this Agreement. The Redeveloper and Tenant shall construct, operate, and maintain the Minimum Improvements on the Redevelopment Property in compliance with the terms and conditions of the PUD Agreement,which is incorporated herein by reference. Section 3.2. Environmental Conditions. (a) The Redeveloper acknowledges that the City makes no representations or warranties as to the condition of the soils on the Redevelopment Property or the fitness of the Redevelopment Property for construction of the Minimum Improvements or any other purpose for which the Redeveloper may make use of such property, and that the assistance provided to the Redeveloper under this Agreement neither implies any responsibility by the City for any contamination of the Redevelopment Property nor imposes any obligation on the City to participate in any cleanup of the Redevelopment Property. (b) Without limiting its obligations under Section 8.3 hereof, the Redeveloper further agrees that it will indemnify, defend, and hold harmless the City and its governing body members, officers, and employees, from any claims or actions arising out of the presence, if any, of hazardous wastes or pollutants existing on or in the Redevelopment Property (including without limitation any asbestos in any existing building), unless and to the extent that such hazardous wastes or pollutants are present as a result of the actions or omissions of the indemnitees.Nothing in this Section will be construed to limit or affect any limitations on liability of the City under State or federal law, including without limitation Minnesota Statutes, Sections 466.04 and 604.02. Section 3.3. Public Redevelopment Costs. In order to make development of the Minimum Improvements economically feasible, the City will reimburse the Redeveloper for a portion of the actual costs of acquisition of the Redevelopment Property and of site improvements necessary for construction of the Minimum Improvements, including, without limitation, grading, footings and foundations, extension of utilities, and construction of a surface parking lot (the "Public Redevelopment Costs"). The total principal amount of Public Redevelopment Costs subject to AGENDA7PAGE 76 AL 141\71\711642.v4 reimbursement will not exceed $1,377,817. Public Redevelopment Costs in excess of$1,377,817 are the sole responsibility of the Redeveloper. Section 3.4. Issuance of Note. (a) Terms. To finance a portion of the Public Redevelopment Costs paid by the Redeveloper, the City shall issue and the Redeveloper shall purchase the Note in the maximum principal amount of$1,377,817. The City shall issue and deliver the Note upon the Redeveloper having: (i) delivered to the City written evidence satisfactory to the City that the Redeveloper has incurred Public Redevelopment Costs for the Minimum Improvements in an amount at least equal to the principal amount of the Note, which evidence must include copies of the paid invoices or other comparable evidence for costs of allowable Public Redevelopment Costs, and a statement that no part of such cost has been included in any previous certification under this Section; (ii) submitted and obtained City approval of financing in accordance with Section 7.1 hereof, and (iii) delivered to the City an investment letter in a form reasonably satisfactory to the City. The terms of the Note will be substantially those set forth in the form of the note set forth in EXHIBIT A of the Authorizing Resolution, and the Note will be subject to all terms of the Authorizing Resolution,which are incorporated herein by reference. (b) Termination of Right to Note. In accordance with Section 469.1763, subdivision 3 of the TIF Act, conditions for delivery of the Note must be met within five (5)years after the date of certification of the TIF District by the County. If the conditions are not satisfied by such date, the City has no further obligations under this Section 3.4. (c) Assignment of Note. The City acknowledges that the Redeveloper may assign the Note to a third parry. The City consents to such an assignment, conditioned upon receipt of an investment letter from such third parry in a form reasonably acceptable to the City. (d) Qualifications. The Redeveloper understands and acknowledges that the City makes no representations or warranties regarding the amount of 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 the City or its municipal advisors in connection with the TIF District or this Agreement are for the benefit of the City, and are not intended as representations on which the Redeveloper may rely. Public Redevelopment Costs exceeding the principal amount of the Note are the sole responsibility of the Redeveloper. Section 3.5. Payment of Administrative Costs. The Redeveloper agrees that it will pay, within 30 days after written notice from the City, the out-of-pocket costs incurred by the City AGENDASPAGE 77 AL 141\71\711642.v4 attributable to or incurred in connection with the establishment of the TIF District, the negotiation and preparation of this Agreement and other documents and agreements in connection with the development contemplated hereunder (the "Administrative Costs"). Administrative Costs shall be evidenced by invoices, statements or other reasonable written evidence of the costs incurred by the City and provided to the Redeveloper. The City acknowledges that the Redeveloper has deposited $25,000 with the City, which deposit shall be credited toward the Redeveloper's obligations under this Section. Upon termination of this Agreement in accordance with its terms, the Redeveloper remains obligated under this Section for Administrative Costs incurred through the effective date of termination. Section 3.6. Records. The City and its representatives shall have the right at all reasonable times after reasonable notice to inspect, examine and copy all books and records of the Redeveloper relating to the Minimum Improvements and the Public Redevelopment Costs. Section 3.7. Business Subsidy Agreement. The provisions of this Section constitute the "business subsidy agreement"for the purposes of the Business Subsidy Act. (a) General Terms. The parties agree and represent to each other as follows: (1) The subsidy provided to the Redeveloper and the Tenant consists of principal amount of the Note described in Section 3.4 hereof. Although the subsidy will be provided directly to the Redeveloper, the subsidy will be passed to the Tenant in the form of lower rents. (2) The public purposes of the subsidy are to increase net jobs in the City and the State and increase the tax base of the City and the State. (3) The goals for the subsidy are: to secure development of the Minimum Improvements on the Redevelopment Property; to maintain such improvements as an office and shop facility for the time period described in clause (6)below; and to create the jobs and wage levels in accordance with Section 3.7(b)hereof. (4) If the goals described in clause (3) are not met, the Redeveloper and the Tenant, jointly and severally, must make the payments to the City described in Section 3.7(c). (5) The subsidy is needed to induce the Redeveloper to construct the Minimum Improvements and the Tenant to locate its business at this site, thus redeveloping substandard property and preserving and enhancing job and tax base growth for the City, all as determined by the City upon approval of the TIF Plan. (6) The Redeveloper or the Tenant must continue operation of the Minimum Improvements as a"Qualified Facility" for at least five years after the Benefit Date (defined hereinafter), subject to the continuing obligation described in Section 10.3 of this Agreement. The term Qualified Facility means a shop and storage facility and associated office space. The improvements will be a Qualified Facility as long as the Minimum Improvements are operated by Redeveloper or the Tenant for the aforementioned qualified AGENDA9PAGE 78 AL 141\71\711642.v4 uses. During any period when the Minimum Improvements are vacant and not operated for the aforementioned qualified uses, the Minimum Improvements will not constitute a Qualified Facility. (7) Neither the Redeveloper nor the Tenant have a parent corporation. (8) Neither the Redeveloper nor the Tenant has received, nor do they expect to receive, financial assistance from any other "grantor" as defined in the Business Subsidy Act, in connection with the Redevelopment Property or the Minimum Improvements. (b) Job and Wage Goals. The `Benefit Date" of the assistance provided in this Agreement is the earlier of the date of issuance of the Certificate of Completion for the Minimum Improvements or the date the Minimum Improvements are occupied by the Redeveloper or the Tenant. Within two years after the Benefit Date (the"Compliance Date"),the Tenant shall (i)create at least two permanent full-time equivalent jobs and an additional two seasonal full-time equivalent jobs on the Redevelopment Property, and (ii) cause the average hourly wage of each of the two permanent and two seasonal jobs to be at least $20.00 per hour, exclusive of benefits. Notwithstanding anything to the contrary herein, if the wage and job goals described in this paragraph are met by the Compliance Date, those goals are deemed satisfied despite the Tenant's continuing obligations under Sections 3.7(a)(6) and 3.7(d). The City may, after a public hearing, extend the Compliance Date by up to one year, provided that nothing in this section will be construed to limit the City's legislative discretion regarding this matter. (c) Remedies. If the Tenant fails to meet the goals described in Section 3.7(a)(3), the Tenant and the Redeveloper j ointly and severally, shall repay to the City upon written demand from the City a"pro rata share" of the principal amount of the Business Subsidy together with interest on that amount at the implicit price deflator as referenced in Minnesota Statutes, Section 116J.994, subdivision 6, as amended, accrued from the date of substantial completion of the Minimum Improvements to the date of payment. The term "pro rata share" means percentages calculated as follows: (i) if the failure relates to the number of jobs, the jobs required less the jobs created, divided by the jobs required; (ii) if the failure relates to wages, the number of jobs required less the number of jobs that meet the required wages, divided by the number of jobs required; (iii) if the failure relates to maintenance of the facility as a Qualified Facility in accordance with Section 3.7(a)(6), 60 less the number of months of operation as a Qualified Facility(where any month in which the Qualified Facility is in operation for at least 15 days constitutes a month of operation), commencing on the Benefit Date and ending with the date the Qualified Facility ceases operation as determined by the City Representative, divided by 60; and (iv) if more than one of clauses (i) through (iii) apply, the average of the applicable percentages,not to exceed 100%. AGENDA�AGE 79 AL 141\71\711642.v4 Nothing in this Section shall be construed to limit the City's remedies under Article IX hereof. In addition to the remedy described in this Section and any other remedy available to the City for failure to meet the goals stated in Section 3.7(a)(3), the Tenant and the Redeveloper agree and understand that it may not a receive a business subsidy from the City or any grantor(as defined in the Business Subsidy Act) for a period of five years from the date of the failure or until the Redeveloper and/or the Tenant satisfy their repayment obligation under this Section, whichever occurs first. (d) Reports. The Tenant must submit to the City a written report regarding business subsidy goals and results by no later than February 1 of each year, commencing February 1, 2022 and continuing until the later of(i) the date the goals stated Section 3.7(a)(3) are met; (ii) 30 days after expiration of the period described in Section 3.7(a)(6); or(iii)if the goals are not met, the date the subsidy is repaid in accordance with Section 3.7(c). The report must comply with Section 116J.994, subdivision 7 of the Business Subsidy Act. The City will provide information to the Tenant regarding the required forms. If the Tenant fails to timely file any report required under this Section, the City will mail the Tenant a warning within one week after the required filing date. If, after 14 days of the postmarked date of the warning, the Tenant fails to provide a report, the Tenant and the Redeveloper, jointly and severally, must pay to the City a penalty of $100 for each subsequent day until the report is filed. The maximum aggregate penalty payable under this Section is $1,000. (The remainder of this page is intentionally left blank.) AGENDA�AGE 80 AL 141\71\711642.v4 ARTICLE IV Construction of Minimum Improvements Section 4.L Construction of Minimum Improvements. The Redeveloper agrees that it will construct the Minimum Improvements on the Redevelopment Property in substantial compliance with the approved Construction Plans and the Tenant agrees that it will operate and maintain, preserve and keep the Minimum Improvements or cause the Minimum Improvements to be maintained, preserved and kept with the appurtenances and every part and parcel thereof,in good repair and condition. Section 4.2. Construction Plans. (a) Before commencement of construction of the Minimum Improvements, the Redeveloper shall submit to the City completed Construction Plans. The Construction Plans shall provide for the construction of the Minimum Improvements and shall be in conformity with the Development Plan, the TIF Plan, this Agreement, and all applicable State and local laws and regulations. The City will approve the Construction Plans in writing if: (i) the Construction Plans conform to the terms and conditions of this Agreement; (ii) the Construction Plans conform to the goals and objectives of the Development Plan; (iii) the Construction Plans conform to all applicable federal, state and local laws, ordinances, rules and regulations; (iv) the Construction Plans are adequate to provide for construction of the Minimum Improvements; and (v) no Event of Default has occurred. No approval by the City shall relieve the Redeveloper of the obligation to comply with the terms of this Agreement or of the Development Plan, applicable federal, state and local laws, ordinances, rules and regulations, or to construct the Minimum Improvements in accordance therewith. No approval by the City shall constitute a waiver of an Event of Default. If approval of the Construction Plans is requested by the Redeveloper in writing at the time of submission, such Construction Plans shall be deemed approved unless rejected in writing by the City, in whole or in part. Such rejections shall set forth in detail the reasons therefor, and shall be made within thirty (30) days (except for any permits or approval required by the State) after the date of their receipt by the City. If the City rejects any Construction Plans in whole or in part, the Redeveloper may submit new or corrected Construction Plans within thirty (30) days after written notification to the Redeveloper of the rejection. The provisions of this Section relating to approval, rejection and resubmission of corrected Construction Plans shall continue to apply until the Construction Plans have been approved by the City. The City's approval shall not be unreasonably withheld. Said approval shall constitute a conclusive determination that the Construction Plans (and the Minimum Improvements, constructed in accordance with said plans) comply to the City's satisfaction with the provisions of this Agreement relating thereto. The Redeveloper hereby waives any and all claims and causes of action whatsoever resulting from the review of the Construction Plans by the City and/or any changes in the Construction Plans requested by the City. Neither the City, nor any employee or official of the City shall be responsible in any manner whatsoever for any defect in the Construction Plans or in any work done pursuant to the Construction Plans, including changes requested by the City. AGENDA�AGE 81 AL 141\71\711642.v4 (b) If the Redeveloper or Tenant, as the case may be, desires to make any material change in the Construction Plans after their approval by the City, the Redeveloper shall submit the proposed change to the City for its approval. If the Construction Plans, as modified by the proposed change, conform to the requirements of this Section 4.2 of this Agreement with respect to such previously approved Construction Plans, the City shall approve the proposed change and notify the Redeveloper in writing of its approval. Such change in the Construction Plans shall,in any event, be deemed approved by the City unless rejected, in whole or in part, by written notice by the City to the Redeveloper, setting forth in detail the reasons therefor. Such rejection shall be made within thirty (30) days after receipt of the notice of such change. The City's approval of any such change in the Construction Plans will not be unreasonably withheld. Section 4.3. Commencement and Completion of Construction. Subject to Unavoidable Delays, the Redeveloper must construct the Minimum Improvements in accordance with the following table: Phase Date of Commencement Date of Completion Office Phase I July 1, 2021 December 31, 2022 Shop Phase I July 1,2022 December 31, 2023 Office Phase 11 April 1, 2027 December 31, 2027 Shop Phase 11 April 1, 2027 December 31, 2028 All work with respect to each phase of the Minimum Improvements to be constructed or provided by the Redeveloper on the Redevelopment Property shall be in substantial compliance with the Construction Plans in all material respects as submitted by the Redeveloper and approved by the City. Upon approval of the Construction Plans, the Redeveloper agrees for itself, its successors and assigns, and every successor in interest to the Redevelopment Property, or any part thereof, that the Redeveloper, and such successors and assigns, shall promptly begin and diligently prosecute to completion the Development of the Redevelopment Property through the construction of the Minimum Improvements thereon, and that such construction shall in any event be commenced and completed within the periods specified in this Section 4.3 of this Agreement. Subsequent to conveyance of the Redevelopment Property, or any part thereof, to the Redeveloper, and until construction of the Minimum Improvements has been completed, the Redeveloper shall make reports, in such detail and at such times as may reasonably be requested by the City, as to the actual progress of the Redeveloper with respect to such construction. Section 4.4. Certificate of Completion. (a) Promptly after substantial completion of each phase of the Minimum Improvements in accordance with those provisions of the Agreement relating solely to the obligations of the Redeveloper to construct such phase (including the dates for beginning and completion thereof), the City will furnish the Redeveloper with a Certificate of Completion in substantially the form provided in Schedule D and a certificate of occupancy for such phase of the Minimum Improvements. Such certification by the City shall be a conclusive determination AGENDA�AGE 82 AL 141\71\711642.v4 of satisfaction and termination of the agreements and covenants in this Agreement and in the deed with respect to the obligations of the Redeveloper, and its successors and assigns, to construct such phase of the Minimum Improvements and the dates for the beginning and completion thereof. (b) Each certificate provided for in this Section 4.4 of this Agreement shall be in such form as will enable it to be recorded in the proper office for the recordation of deeds and other instruments pertaining to the Redevelopment Property. If the City shall refuse or fail to provide any certification in accordance with the provisions of this Section 4.4 of this Agreement, the City shall, within thirty (30) days after written request by the Redeveloper, provide the Redeveloper with a written statement, indicating in adequate detail in what respects the Redeveloper has failed to complete the Minimum Improvements in accordance with the provisions of the Agreement, or is otherwise in default, and what measures or acts it will be necessary, in the opinion of the City, for the Redeveloper to take or perform in order to obtain such certification. (c) The construction of each phase of the Minimum Improvements shall be deemed to be commenced upon beginning of excavation for the applicable building, and shall be deemed to be substantially completed when the Redeveloper has received a certificate of occupancy issued by the City for such phase of the Minimum Improvements. (The remainder of this page is intentionally left blank.) AGENDA-'PAGE 83 AL 141\71\711642.v4 ARTICLE V Insurance Section 5.1. Insurance. The Redeveloper or Tenant will provide and maintain (or cause to be provided and maintained) at all times during the process of constructing the Minimum Improvements an All Risk Broad Form Basis Insurance Policy and, from time to time during that period, at the request of the City, furnish the City with proof of payment of premiums on policies covering the following: (i) Builder's risk insurance, written on the so-called "Builder's Risk -- Completed Value Basis," in an amount equal to one hundred percent (100%) of the insurable value of the Minimum Improvements at the date of completion, and with coverage available in nonreporting form on the so-called "all risk" form of policy. The interest of the City shall be protected in accordance with a clause in form and content satisfactory to the City; (ii) Comprehensive general liability insurance (including operations, contingent liability, operations of subcontractors, completed operations and contractual liability insurance) together with an Owner's Policy with limits against bodily injury and property damage of not less than $1,000,000 for each occurrence (to accomplish the above-required limits, an umbrella excess liability policy may be used); and (iii) Workers' compensation insurance, with statutory coverage. (b) Upon completion of construction of the Minimum Improvements and prior to the Maturity Date, the Redeveloper or Tenant shall maintain, or cause to be maintained, at their own cost and expense, and from time to time at the request of the City shall furnish proof of the payment of premiums on, insurance as follows: (i) Insurance against loss and/or damage to the Minimum Improvements under a policy or policies covering such risks as are ordinarily insured against by similar businesses. (ii) Comprehensive general public liability insurance, including personal injury liability (with employee exclusion deleted), against liability for injuries to persons and/or property, in the minimum amount for each occurrence and for each year of$1,000,000, and shall be endorsed to show the City as an additional insured. (iii) Such other insurance, including workers' compensation insurance respecting all employees of the Tenant, in such amount as is customarily carried by like organizations engaged in like activities of comparable size and liability exposure; provided that the Tenant may be self-insured with respect to all or any part of its liability for workers'compensation. AGENDA�AGE 84 AL 141\71\711642.v4 (c) All insurance required in Article V of this Agreement shall be taken out and maintained in responsible insurance companies selected by the Redeveloper or the Tenant that are authorized under the laws of the State to assume the risks covered thereby. Upon request, the Redeveloper or Tenant will deposit annually with the City a certificate or certificates of the respective insurers stating that such insurance is in force and effect. Unless otherwise provided in this Article V of this Agreement each policy shall contain a provision that the insurer shall not cancel nor modify it in such a way as to reduce the coverage provided below the amounts required herein without giving written notice to the Redeveloper or the Tenant and the City at least 30 days before the cancellation or modification becomes effective. In lieu of separate policies, the Redeveloper or the Tenant may maintain a single policy, blanket or umbrella policies, or a combination thereof, having the coverage required herein, in which event the Redeveloper or the Tenant shall deposit with the City a certificate or certificates of the respective insurers as to the amount of coverage in force upon the Minimum Improvements. (d) The Redeveloper or the Tenant agree to notify the City immediately in the case of damage exceeding $250,000 in amount to, or destruction of, the Minimum Improvements or any portion thereof resulting from fire or other casualty. In such event, the Redeveloper or the Tenant will forthwith repair, reconstruct, and restore the Minimum Improvements to substantially the same or an improved condition or value as it existed prior to the event causing such damage and, to the extent necessary to accomplish such repair, reconstruction, and restoration, the Redeveloper or the Tenant will apply the net proceeds of any insurance relating to such damage received by the Redeveloper or the Tenant to the payment or reimbursement of the costs thereof. The Redeveloper or the Tenant shall complete the repair, reconstruction and restoration of the Minimum Improvements, regardless of whether the net proceeds of insurance received by the Redeveloper or the Tenant for such purposes are sufficient to pay for the same. Any net proceeds remaining after completion of such repairs, construction, and restoration shall be the property of the Redeveloper or the Tenant. (e) In lieu of its obligation to reconstruct the Minimum Improvements as set forth in this Section, the Redeveloper shall have the option of. (i) if Redeveloper has assigned the Note to a third parry, paying to the City an amount that, in the opinion of the City and its fiscal consultant, is sufficient to pay or redeem the outstanding principal and accrued interest on the Note, or(ii) so long as the Redeveloper is the owner of the Note,waiving its right to receive subsequent payments under the Note. (f) The Redeveloper., the Tenant and the City agree that all of the insurance provisions set forth in this Article V shall terminate upon the termination of this Agreement. Section 5.2. Subordination. Notwithstanding anything to the contrary contained in this Article V, the rights of the City with respect to the receipt and application of any proceeds of insurance shall, in all respects, be subject and subordinate to the rights of any lender under a Mortgage approved pursuant to Article VII of this Agreement. AGENDA�AGE 85 AL 141\71\711642.v4 ARTICLE VI Delinquent Taxes and Review of Taxes Section 6.1. Right to Collect Delinquent Taxes. Redeveloper agrees for itself, its successors and assigns, in addition to the obligation pursuant to statute to pay real estate taxes, that it is also obligated by reason of this Agreement to pay before delinquency, or cause Tenant to pay before delinquency, all real estate taxes assessed against the Redevelopment Property and the Minimum Improvements. The Redeveloper acknowledges that this obligation creates a contractual right on behalf of the City through the Maturity Date 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 the City is the prevailing parry, the City shall also be entitled to recover its costs, expenses and reasonable attorney fees. Section 6.2. Reduction of Taxes. Each of the Redeveloper and Tenant agrees that prior to the Maturity Date: (1) it will not seek through petition or other means to have the estimated market value for the Development Property reduced; (2) it will not seek administrative review or judicial review of the applicability of any real property tax statute determined by any Tax Official to be applicable to the Minimum Improvements or the Developer or raise the inapplicability of any such tax statute as a defense in any proceedings, including delinquent tax proceedings; (3) it will not seek administrative review or judicial review of the constitutionality of any real property tax statute determined by any Tax Official to be applicable to the Minimum Improvements or the Redeveloper or Tenant or raise the unconstitutionality of any such real property tax statute as a defense in any proceedings, including delinquent tax proceedings; and (4) it will not (A) cause willful destruction of the Minimum Improvements or any part thereof, (B) willfully refuse to reconstruct damaged or destroyed property pursuant to Section 5.1 hereof, (C) apply to the Commissioner of Revenue of the State requesting an abatement of real property taxes pursuant to Minnesota Statutes, Chapter 270; (D) transfer the Redevelopment Property or Minimum Improvements, or any part thereof, to an entity exempt from the payment of real property taxes under State law; or (E) engage in any other proceedings, whether administrative, legal or equitable, with any administrative body within the County or the State or with any court of the State or the federal government to reduce or defer the amount of real property taxes assessed against the Redevelopment Property and the Minimum Improvements, except that nothing in this Section shall prevent the Redeveloper from taking any action it may choose with respect to any income tax matters. (The remainder of this page is intentionally left blank.) AGENDA�AGE 86 AL 141\71\711642.v4 ARTICLE VII Financing Section 7.L Financing. (a) Before commencement of the Minimum Improvements, the Redeveloper shall submit to the City evidence of financing in the form of one or more loan commitments or Redeveloper's own funds for such construction, which is sufficient for the construction of the Minimum Improvements. Such evidence may be submitted as short term financing, long term mortgage financing, a bridge loan with a long-term take-out financing commitment, bank account statement, or any combination of the foregoing. Such commitment or commitments for short term or long term mortgage financing shall be subject only to such conditions as are normal and customary in the mortgage banking industry. (b) If the City finds that such financing is sufficiently committed and adequate in amount to provide for the construction of the Minimum Improvements, then the City shall notify the Redeveloper in writing of its approval. Such approval shall not be unreasonably withheld and either approval or rejection shall be given within thirty (30) days from the date when the City is provided the evidence of financing. A failure by the City to respond to such evidence of financing shall be deemed to constitute an approval hereunder. If the City rejects the evidence of financing as inadequate, it shall do so in writing specifying the basis for the rejection. In any event the Redeveloper shall submit adequate evidence of financing within thirty (30) days after such rejection. Approval of any subordination agreement under Section 7.3 hereof will constitute approval of financing for the purposes of this Section. (c) If the Redeveloper finances the construction of the Minimum Improvements internally, the Redeveloper shall provide the City with an instrument reasonably acceptable to the City, certifying as to the sufficiency of Redeveloper funds to construct the Minimum Improvements. Section 7.2. Cit.rOption to Cure Default on Mortgage. In the event that there occurs a default under any Mortgage authorized pursuant to this Article VII, the Redeveloper shall cause the City to receive copies of any notice of default received by the Redeveloper from the holder of such Mortgage. Thereafter, the City shall have the right, but not the obligation, to cure any such default on behalf of the Redeveloper within such cure periods as are available to the Redeveloper under the Mortgage documents. In the event there is an event of default under this Agreement, the City will transmit to the Holder of any Mortgage a copy of any notice of default given by the City pursuant to Article IX of this Agreement. Section 7.3. Subordination and Modification for the Benefit of Mortgagee. In order to facilitate the Redeveloper obtaining financing for purchase of the Redevelopment Property and for construction of the Minimum Improvements according to the Construction Plans, the City agrees to subordinate its rights under this Agreement, provided that such subordination shall be subject to such reasonable terms and conditions as the City and Holder mutually agree in writing. AGENDA�AGE 87 AL 141\71\711642.v4 ARTICLE VIII Prohibitions Against Assignment and Transfer; Indemnification Section 8.1. Representation as to Development. The Redeveloper represents and agrees that its purchase of the Redevelopment Property or portions thereof, and its other undertakings pursuant to the Agreement, are, and will be used, for the purpose of development of the Redevelopment Property and not for speculation in land holding. Section 8.2. Prohibition Against Redeveloper's Transfer of Property and Assignment of Agreement. The Redeveloper represents and agrees that prior to issuance of a Certificate of Completion for all phases of the Minimum Improvements: (a) The Redeveloper has not made or created and will not make or create or suffer to be made or created any total or partial sale, assignment, conveyance, or lease, or any trust or power, or transfer in any other mode or form of or with respect to this Agreement or the Redevelopment Property, or any contract or agreement to do any of the same,to any person or entity(collectively, a "Transfer"), without the prior written approval of the City. The term "Transfer" does not include (i) encumbrances made or granted by way of security for, and only for, the purpose of obtaining construction, interim or permanent financing necessary to enable the Redeveloper or any successor in interest to the Redevelopment Property or to construct the Minimum Improvements, (ii) any lease, license, easement or similar arrangement entered into in the ordinary course of business related to operation of the Minimum Improvements, including, but not limited to, leasing of the Minimum Improvements to the Tenant, or(iii) any sale, conveyance, or transfer in any form to any Affiliate. Any such Transfer is subject to the provisions of this Section. It is expressly understood that any lease between the Redeveloper and the Tenant does not constitute a transfer for purposes of this Agreement. (b) In the event the Redeveloper, upon Transfer of the Redevelopment Property or any portion thereof before issuance of the final Certificate of Completion, seeks to be released from its obligations under this Agreement as to the portion of the Redevelopment Property that is transferred, the City shall be entitled to require, except as otherwise provided in the Agreement, as conditions to any such release that: (i) Any proposed transferee shall have the qualifications and financial responsibility, in the reasonable judgment of the City, necessary and adequate to fulfill the obligations undertaken in this Agreement by the Redeveloper as to the portion of the Redevelopment Property to be transferred. (ii) Any proposed transferee, by instrument in writing satisfactory to the City and in form recordable in the public land records of Wright County, Minnesota, shall, for itself and its successors and assigns, and expressly for the benefit of the City, have expressly assumed all of the obligations of the Redeveloper under this Agreement as to the portion of the Redevelopment AGENDA�AGE 88 AL 141\71\711642.v4 Property to be transferred and agreed to be subject to all the conditions and restrictions to which the Redeveloper is subject as to such portion; provided, however, that the fact that any transferee of, or any other successor in interest whatsoever to,the Redevelopment Property, or any part thereof, shall not, for whatever reason,have assumed such obligations or so agreed, and shall not(unless and only to the extent otherwise specifically provided in this Agreement or agreed to in writing by the City) deprive the City of any rights or remedies or controls with respect to the Redevelopment Property, the Minimum Improvements or any part thereof or the construction of the Minimum Improvements; it being the intent of the parties as expressed in this Agreement that(to the fullest extent permitted at law and in equity and excepting only in the manner and to the extent specifically provided otherwise in this Agreement) no transfer of, or change with respect to, ownership in the Redevelopment Property or any part thereof, or any interest therein, however consummated or occurring, and whether voluntary or involuntary, shall operate, legally, or practically, to deprive or limit the City of or with respect to any rights or remedies on controls provided in or resulting from this Agreement with respect to the Redevelopment Property that the City would have had, had there been no such transfer or change. In the absence of specific written agreement by the City to the contrary,no such transfer or approval by the City thereof shall be deemed to relieve the Redeveloper or any other party bound in any way by this Agreement or otherwise with respect to the Redevelopment Property, from any of its obligations with respect thereto. (iii) Any and all instruments and other legal documents involved in effecting the Transfer of any interest in this Agreement or the Redevelopment Property governed by this Article VHI, shall be in a form reasonably satisfactory to the City. In the event the foregoing conditions are satisfied then the Redeveloper shall be released from its obligation under this Agreement, as to the portion of the Redevelopment Property that is transferred, assigned, or otherwise conveyed. Section 8.3. Release and Indemnification Covenants. (a) The Redeveloper and the Tenant release from and covenant and agree that the City and the governing body members, officers, agents, servants and employees thereof(collectively, the "Protected Persons") shall not be liable for and agree, jointly and severally, to indemnify and hold harmless the Protected Persons 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 breach of a term or provision under this Agreement, negligence, willful misrepresentation, or any willful or wanton misconduct of or by any of the Protected Persons, the Redeveloper and Tenant agree, jointly and severally, to protect and defend the Protected Persons, now or forever, and further agree 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 acquisition, construction, installation, ownership, and operation of the Minimum Improvements. (c) Except for any breach of a term or provision under this Agreement, negligence, willful misrepresentation, or any willful or wanton misconduct of or by any of the Protected Persons, the Protected Persons shall not be liable for any damage or injury to the persons or AGEND� AGE 89 AL 141\71\711642.v4 property of the Redeveloper, the Tenant, or their officers, agents, servants or employees or any other person who may be about the Redevelopment Property or Minimum Improvements due to any act of negligence of any person other than any of the Protected Persons. (d) All covenants, stipulations, promises, agreements and obligations of the City contained herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the City and not of any governing body member, officer, agent, servant or employee of the City in the individual capacity thereof. (The remainder of this page is intentionally left blank.) AGEND� AGE 90 AL 141\71\711642.v4 ARTICLE IX Events of Default; Termination Section 9.1. Events of Default Defined. The following shall be "Events of Default" under this Agreement and the term "Event of Default" shall mean, whenever it is used in this Agreement (unless the context otherwise provides) any of the following event that remains uncured by such party beyond any applicable notice, cure and/or graced period set forth in Section 9.2 hereof: (a) any failure by any party to observe or perform any covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement or under any other agreement entered into between the Redeveloper or the Tenant and the City in connection with development of the Redevelopment Property; and (b) any material default by Redeveloper or Tenant under a Mortgage, beyond any applicable notice, cure and/or grace period set forth therein. Section 9.2. Remedies on Default. Whenever any Event of Default referred to in Section 9.1 of this Agreement occurs, the non-defaulting party may exercise its rights under this Section 9.2 after providing thirty (30) days written notice to the defaulting party (and any other party to this Agreement) of the Event of Default, but only if the Event of Default has not been cured within said thirty (30) days or, if the Event of Default is by its nature incurable within thirty (30) days, the defaulting party does not provide assurances 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 the Agreement until it receives assurances that the defaulting party will cure its default and continue its performance under the Agreement. (b) Cancel and rescind or terminate the Agreement and/or the Note. (c) Take whatever action, including legal, equitable or administrative action, which may appear necessary or desirable to collect any payments due under this Agreement, or to enforce performance and observance of any obligation, agreement, or covenant under this Agreement. (d) Notwithstanding anything to the contrary herein, in the case of defaults by Redeveloper or the Tenant described in Section 3.7, the City has the additional remedies specified therein, subject to the qualification described in Section 10.3. Section 9.3. No Remedy Exclusive. No remedy herein conferred upon or reserved to the City, Redeveloper or Tenant is intended to be exclusive of any other available remedy or remedies, but each and every such 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 or by AGEND� AGE 91 AL 141\71\711642.v4 statute. 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 the City to exercise any remedy reserved to it, it shall not be necessary to give notice, other than such notice as may be required in this Article IX. Section 9.4. No Additional Waiver Implied by One Waiver. In the event any agreement contained in this Agreement should be breached by any party and thereafter waived by the other parties, 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. (The remainder of this page is intentionally left blank.) AGEND� AGE 92 AL 141\71\711642.v4 ARTICLE X Additional Provisions Section 10.1. Conflict of Interests; City Representatives Not Individually Liable. The City, the Redeveloper, and the Tenant to the best of their respective knowledge, represent and agree that no member, official, or employee of the City shall have any personal 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 personal interests or the interests of any corporation, partnership, or association in which he is, directly or indirectly, interested. No member, official, or employee of the City shall be personally liable to the Redeveloper, Tenant or any successor in interest, in the event of any default or breach by the City or for any amount which may become due to the Redeveloper, Tenant or successor or on any obligations under the terms of the Agreement. Section 10.2. Equal Employment Opportunity. The Redeveloper, for itself and its successors and assigns, agrees that during the construction of the Minimum Improvements provided for in the Agreement it will comply with all applicable federal, state and local equal employment and non-discrimination laws and regulations. Section 10.3. Restrictions on Use. The Redeveloper and Tenant agree that until the Maturity Date, the Redeveloper, the Tenant and such successors and assigns, shall use the Redevelopment Property and the Minimum Improvements thereon only as a Qualified Facility, provided that after expiration of the five-year period described in Section 3.7(a)(6), the repayment remedy described in Section 3.7(c) may not be imposed on Redeveloper or Tenant for default under this Section, and City is limited to any other remedies available under Article IX hereof. Further, until the Maturity Date the Redeveloper and Tenant shall not discriminate upon the basis of race, color, creed, sex or national origin in the sale, lease, or rental or in the use or occupancy of the Redevelopment Property or any improvements erected or to be erected thereon, or any part thereof. Section 10.4. Provisions Not Merged With Deed. None of the provisions of this Agreement are intended to or shall be merged by reason of any deed transferring any interest in the Redevelopment Property and any such deed shall not be deemed to affect or impair the provisions and covenants of this Agreement. Section 10.5. Titles of Articles and Sections. Any titles of the several parts, Articles, and Sections of the Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 10.6. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand, or other communication under the Agreement by either party to the other shall be sufficiently given or delivered if it is dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally; and AGENDkPAGE 93 AL 141\71\711642.v4 (a) in the case of the Redeveloper, is addressed to or delivered personally to the Redeveloper at Hunter Land Company, LLC, 12301 50th Street NE, St. Michael, Minnesota 55376; (b) in the case of the Tenant, is addressed to or delivered personally to the Tenant at Fehn Companies, Incorporated, 5050 Barthel Industrial Drive, Albertville, Minnesota 55301; and (c) in the case of the City, is addressed to or delivered personally to the City at the City of Albertville, 5959 Main Avenue NE, P.O. Box 9, Albertville, Minnesota 55301, Attn: City Administrator; 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. Section 10.7. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute one and the same instrument. Section 10.8. Recording. The City may record this Agreement and any amendments thereto with the County recorder. The Redeveloper shall pay all costs for recording. Section 10.9. Amendment. This Agreement may be amended only by written agreement approved by the City,the Redeveloper, and the Tenant. Section 10.10. CityApprovals. Unless otherwise specified, any approval required by the City under this Agreement may be given by the City Representative. Section 10.11. Termination. This Agreement terminates on the Maturity Date. Within thirty (30) days after the Maturity Date, the City will deliver to Redeveloper a written release in recordable form satisfactory to Redeveloper, evidencing termination of this Agreement. Section 10.12. Choice of Law and Venue. This Agreement shall be governed by and construed in accordance with the laws of the state of Minnesota. Any disputes, controversies, or claims arising out of this Agreement shall be heard in the state or federal courts of Minnesota, and all parties to this Agreement waive any objection to the jurisdiction of these courts, whether based on convenience or otherwise. (The remainder of this page is intentionally left blank.) AGEND� AGE 94 AL 141\71\711642.v4 IN WITNESS WHEREOF, the City has caused this Agreement to be duly executed in its name and behalf and its seal to be hereunto duly affixed and the Redeveloper and Tenant has caused this Agreement to be duly executed in its name and behalf on or as of the date first above written. CITY OF ALBERTVILLE By Its Mayor By Its City Administrator STATE OF MINNESOTA ) SS. COUNTY OF WRIGHT ) The foregoing instrument was acknowledged before me this day of 2021, by Jillian Hendrickson, the Mayor of the City of Albertville, Minnesota, a Minnesota municipal corporation, on behalf of the City. Notary Public STATE OF MINNESOTA ) SS. COUNTY OF WRIGHT ) The foregoing instrument was acknowledged before me this day of 2021, by Adam Nafstad, the City Administrator of the City of Albertville, Minnesota, a Minnesota municipal corporation, on behalf of the City. Notary Public AGENA, AGE 95 AL 141\71\711642.v4 REDEVELOPER: HUNTER LAND COMPANY, LLC By Its STATE OF MINNESOTA ) SS. COUNTY OF ) The foregoing instrument was acknowledged before me this day of , 2021 by , the of Hunter Land Company, LLC, Minnesota limited liability company, on behalf of the company. Notary Public AGENA, AGE 96 AL 141\71\711642.v4 TENANT: FERN COMPANIES, INCORPORATED By Its STATE OF MINNESOTA ) SS. COUNTY OF ) The foregoing instrument was acknowledged before me this day of , 2021 by , the of Fehn Companies, Incorporated, a Minnesota corporation, on behalf of the corporation. Notary Public AGENA, AGE 97 AL 141\71\711642.v4 SCHEDULE A DESCRIPTION OF REDEVELOPMENT PROPERTY Lot 1, Block 1, Fehn Industrial Park according to the plat of record in the Wright County Recorder's Office, Wright County, Minnesota AGENC3`A-1AGE 98 AL 141\71\711642.v4 SCHEDULE B AUTHORIZING RESOLUTION CITY OF ALBERTVILLE,MINNESOTA RESOLUTION NO. RESOLUTION APPROVING CONTRACT FOR PRIVATE DEVELOPMENT WITH HUNTER LAND COMPANY,LLC AND FEHN COMPANIES INCORPORATED AND AWARDING THE SALE OF,AND PROVIDING THE FORM,TERMS, COVENANTS AND DIRECTIONS FOR THE ISSUANCE OF ITS TAX INCREMENT REVENUE NOTE (FEHN PROJECT) IN THE MAXIMUM PRINCIPAL AMOUNT OF $1,377,817 BE IT RESOLVED BY the City Council (the "Council") of the City of Albertville, Minnesota(the"City") as follows: Section 1. Authorization, Award of Sale. 1.01. Authorization. (a) The City has heretofore approved the establishment of Tax Increment Financing (Economic Development) District No. 19 (Fehn) (the "TIF District"), a redevelopment district, within Municipal Development District No. 1 (the "Project") in the City, and has adopted a tax increment financing plan for the purpose of financing certain improvements within the Project. (b) To facilitate the development of certain property within Project and the TIF District, the City, Hunter Land Company, LLC (the "Owner"), and Fehn Companies Incorporated (the "Tenant") have negotiated a Contract for Private Redevelopment (the "Agreement"), dated as of , 2021, which provides for the construction and development of approximately 49,200 square feet of storage, office, and shop space for the Tenant's operation of its earthwork and demolition services (the "Minimum Improvements") on the Development Property (as described in the Agreement), and the issuance by the City of its Tax Increment Revenue Note (Fehn Project) (the"Note")to the Owner. (c) Pursuant to Minnesota Statutes, Section 469.178, the City is authorized to issue and sell its bonds for the purpose of financing a portion of the public development costs of the Project. Such bonds are payable from all or any portion of revenues derived from the TIF District and pledged to the payment of the bonds. The City hereby finds and determines that it is in the best interests of the City that it issue and sell the Note in the maximum aggregate principal amount of $1,377,817, for the purpose of financing certain public costs of the Minimum Improvements. 1.02. Agreement Approved, Issuance, Sale, and Terms of the Note. (a) The City Council on this date has considered the Agreement, and hereby approves the Agreement and authorizes the Mayor and City Administrator to execute such Agreement in substantially the form on file with City, subject to modifications that do not alter the substance of AGENDIA-�AGE 99 AL 141\71\711642.v4 the transaction and are approved by such officials, provided that execution of the Agreement by such officials is conclusive evidence of their approval. (b) Pursuant to the Agreement, the Note shall be sold to the Owner. The Note shall be dated as of the date of delivery and shall bear interest at the rate that is the lesser of 4.00% or the Owner's actual mortgage financing rate. The City shall receive in exchange for the sale of the Note the payment by the Owner of the Public Redevelopment Costs as defined in the Agreement. The Note will be delivered in accordance with the terms of Section 3.4 of the Agreement. Section 2. Form of Note. The Note shall be in substantially the form set forth in EXHIBIT A attached hereto, with the blanks to be properly filled in and the principal amount adjusted as of the date of issue. Section 3. Terms, Execution and Delivery. 3.01. Denomination, Pam. The Note shall be issued as a single typewritten note numbered R-1. The Note shall be issuable only in fully registered form. Principal of and interest on the Note shall be payable by check or draft issued by the Registrar described herein. 3.02. Dates, Interest Payment Dates. Principal of and interest on the Note shall be payable by mail to the owner of record thereof as of the close of business on the fifteenth day of the month preceding the Payment Date, whether or not such day is a business day. 3.03. Registration. The City hereby appoints the City Administrator to perform the functions of registrar, transfer agent and paying agent (the "Registrar"). The effect of registration and the rights and duties of the City and the Registrar with respect thereto shall be as follows: (a) Register. The Registrar shall keep at its office a bond register in which the Registrar shall provide for the registration of ownership of the Note and the registration of transfers and exchanges of the Note. (b) Transfer of Note. 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 shall 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 shall not be transferred to any person other than an Affiliate, or other related entity, of the Owner unless the City has been provided with an opinion of counsel or a certificate of the transferor, in a form satisfactory to the City, that such 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 such Payment Date. (c) Cancellation. The Note surrendered upon any transfer shall be promptly AGENDP4GE 100 AL 141\71\711642.v4 cancelled by the Registrar and thereafter disposed of as directed by the City. (d) Improper or Unauthorized Transfer. When the Note is presented to the Registrar for transfer, the Registrar may refuse to transfer the same until it is satisfied that the endorsement on such Note or separate instrument of transfer is legally authorized. The Registrar shall incur no liability for its refusal, in good faith, to make transfers which it, in its judgment, deems improper or unauthorized. (e) Persons Deemed Owners. The City 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 shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on such Note and for all other purposes, and all such payments so made to any such registered owner or upon the owner's order shall be valid and effectual to satisfy and discharge the liability of the City upon such Note to the extent of the sum or sums so paid. (f) Taxes, Fees and Charges. 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 such transfer or exchange. (g) Mutilated, Lost, Stolen or Destroyed Note. In case the Note shall become mutilated or be lost, stolen, or destroyed, the Registrar shall deliver a new Note of like amount, maturity dates and tenor in exchange and substitution for and upon cancellation of such mutilated Note or in lieu of and in substitution for such Note 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 is lost, stolen, or destroyed, upon filing with the Registrar of evidence satisfactory to it that such Note was lost, stolen, or destroyed, and of the ownership thereof, and upon furnishing to the Registrar of an appropriate bond or indemnity in form, substance, and amount satisfactory to it, in which both the City and the Registrar shall be named as obliges. The Note so surrendered to the Registrar shall be cancelled by it and evidence of such cancellation shall be given to the City. If the mutilated, lost, stolen, or destroyed Note has already matured or been called for redemption in accordance with its terms, it shall not be necessary to issue a new Note prior to payment. 3.04. Preparation and Delivery. The Note shall be prepared under the direction of the City Administrator and shall be executed on behalf of the City by the signatures of its Mayor and City Administrator. In case any officer whose signature shall appear on the Note shall cease to be such officer before the delivery of the Note, such signature shall nevertheless be valid and sufficient for all purposes, the same as if such officer had remained in office until delivery. When the Note has been so executed, it shall be delivered by the City Administrator to the Owner thereof in accordance with the Agreement. Section 4. Security Provisions. 4.01. Pledge. The City hereby pledges to the payment of the principal of and interest on the Note all Available Tax Increment as defined in the Note. Available Tax Increment shall be applied to payment of the principal of and interest on the Note in accordance with the terms of the form of Note set forth in Exhibit A to this resolution. AGEND,PFR kGE 101 AL 141\71\711642.v4 4.02. TIF Fund. Until the date the Note is no longer outstanding and no principal thereof or interest thereon (to the extent required to be paid pursuant to this resolution) remains unpaid, the City shall maintain a separate and special "TIF Fund"to be used for no purpose other than the payment of the principal of and interest on the Note. The City irrevocably agrees to appropriate to the TIF Fund in each year Available Tax Increment. Any Available Tax Increment remaining in the TIF Fund shall be transferred to the City's account for TIF District No. 19 upon the payment of all principal and interest to be paid with respect to the Note. Section 5. Certification of Proceedings. The officers of the City are hereby authorized and directed to prepare and furnish to the Owner of the Note certified copies of all proceedings and records of the City, and such other affidavits, certificates, and information as may be required to show the facts relating to the legality and marketability of the Note as the same appear from the books and records under their custody and control or as otherwise known to them, and all such certified copies, certificates, and affidavits, including any heretofore furnished, shall be deemed representations of the City as to the facts recited therein. Section 6. Effective Date. This resolution shall be effective upon full execution of the Agreement. Adopted by the City Council of the City of Albertville, Minnesota, this day of , 2021. Mayor ATTEST: City Administrator AGENDPP�GE 102 AL 141\71\711642.v4 EXHIBIT A TO THE AUTHORIZING RESOLUTION UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF WRIGHT CITY OF ALBERTVILLE No. R-1 $ TAX INCREMENT REVENUE NOTE (FERN PROJECT) Rate Date of Original Issue % , 20 The City of Albertville, Minnesota (the "City"), for value received, certifies that it is indebted and hereby promises to pay to Hunter Land Company, LLC, a Minnesota limited liability company, or its registered assigns (the "Owner"), the principal sum of $ and to pay interest thereon at the annual rate set forth above, but solely from the sources and to the extent set forth herein. Capitalized terms shall have the meanings provided in the Contract for Private Redevelopment, dated as of , 2021 (the "Agreement"), between the City, the Owner, and Fehn Companies, Incorporated, unless the context requires otherwise. 1. Pam. Principal and interest (the "Payments") shall be paid on August 1, 2024 and each February 1 and August I thereafter (the "Payment Dates"), to and including the earliest of (i) February 1, 2050, (ii) such date (if any) as the City shall have terminated the Agreement pursuant to its terms, or (iii) such date the Developer has received the principal amount of the TIF Note plus accrued interest thereon (the"Final Payment Date"), in the amounts and from the sources set forth in Section 3 herein. Payments shall be applied first to accrued interest, and then to unpaid principal. Payments are payable by mail to the address of the Owner or such other address as the Owner may designate upon thirty (30) days' written notice to the City. Payments on this Note 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. Simple, non-compounding interest at the rate stated herein shall accrue on the unpaid principal, commencing as of the date of issue. Interest shall be computed on the basis of a year of three hundred sixty (360) days consisting of twelve (12) thirty- (30-) day months, and shall be 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 shall mean, on each Payment Date, ninety-five percent (95%) of the Tax Increment attributable to the Minimum Improvements on the Development Property and paid to the City by Wright County in the six (6) months preceding the Payment Date. Available Tax Increment shall not include any Tax Increment if, as of any Payment Date, there is an uncured Event of Default under the Agreement. AGENDPAGE 103 AL 141\71\711642.v4 The City shall 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 the City to pay the entire amount of principal of or interest on this Note on any Payment Date shall not constitute a default hereunder as long as the City pays principal of and interest hereon to the extent of Available Tax Increment. The City shall have no obligation to pay any unpaid balance of principal or accrued interest that may remain after the Final Payment Date. 4. Optional Prepayment. The principal sum and all accrued interest payable under this Note are prepayable in whole or in part at any time by the City without premium or penalty. No partial prepayment shall affect the amount or timing of any other regular payment otherwise required to be made under this Note. 5. Termination. At the City's option, this Note shall terminate and the City's obligation to make any payments under this Note shall be discharged upon the occurrence of an Event of Default on the part of the Developer as defined in Section 9.1 of the Agreement, but only if the Event of Default has not been cured in accordance with Section 9.2 of the Agreement. 6. Nature of Obligation. This Note is issued in the total principal amount of $ issued to aid in financing certain public development costs and administrative costs of a Project undertaken by the City pursuant to Minnesota Statutes, Sections 469.124 through 469.133, as amended, and is issued pursuant to an authorizing resolution (the "Resolution") duly adopted by the City on , 2021, and pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections 469.174 through 469.1794, as amended. This Note is a limited obligation of the City which is payable solely from Available Tax Increment pledged to the payment hereof under the Resolution. This Note 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, the City. Neither the City, the State of Minnesota, nor any political subdivision thereof shall be obligated to pay the principal of and 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 City, 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. Registration and Transfer. This Note is issuable only as a fully registered note without coupons. As provided in the Resolution, and subject to certain limitations set forth therein, this Note is transferable upon the books of the City kept for that purpose at the principal office of the City Administrator of the City, by the Owner hereof in person or by such Owner's attorney duly authorized in writing, upon surrender of this Note together with a written instrument of transfer satisfactory to the City, duly executed by the Owner. Upon such transfer or exchange and the payment by the Owner of any tax, fee, or governmental charge required to be paid by the City with respect to such 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 date. 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 the City AGENDM4GE 104 AL 141\71\711642.v4 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 City Council of the City of Albertville, Minnesota has caused this Note to be executed with the manual signatures of its Mayor and City Administrator, all as of the Date of Original Issue specified above. CITY OF ALBERTVILLE, MINNESOTA Mayor City Administrator REGISTRATION PROVISIONS The ownership of the unpaid balance of the Note herein is registered in the bond register of the City Administrator of the City of Albertville, Minnesota, in the name of the person last listed below. Signature of Date of Registration Registered Owner City Administrator Hunter Land Company, LLC Federal Tax ID: AGENDMP'�GE 105 AL 141\71\711642.v4 SCHEDULE C FORM OF CERTIFICATE OF COMPLETION WHEREAS, the City of Albertville (the "City"), Hunter Land Company, LLC, a Minnesota limited liability company (the "Redeveloper"), and Fehn Properties, Incorporated, a Minnesota corporation, entered into a certain Contract for Private Redevelopment, dated as of , 2021 (the "Contract"), and filed in the Office of the County Recorder of Wright County, Minnesota, on , 2021, as Document No. ; and WHEREAS, the Contract contains certain covenants and restrictions set forth in Articles III and IV thereof related to completing certain Minimum Improvements; and WHEREAS, the Redeveloper has performed said covenants and conditions insofar as it is able in a manner deemed sufficient by the Authority to permit the execution and recording of this certification; NOW, THEREFORE, this is to certify that all construction and other physical improvements related to the Minimum Improvements specified to be done and made by the Redeveloper have been completed and the agreements and covenants in Articles III and IV of the Contract have been performed by the Redeveloper, and this Certificate is intended to be a conclusive determination of the satisfactory termination of the covenants and conditions of Articles III and IV of the Contract related to completion of the Minimum Improvements, but any other covenants in the Contract shall remain in full force and effect. (The remainder of this page is intentionally blank; signature follows.) AGEND)�P�GE 106 AL 141\71\711642.v4 Dated: , 20 . CITY OF ALBERTVILLE By City Representative STATE OF MINNESOTA ) ) ss. COUNTY OF WRIGHT ) The foregoing instrument was acknowledged before me this day of , 20 by , the of the City of Albertville, Minnesota, a Minnesota municipal corporation, on behalf of the corporation. Notary Public This document drafted by: Kennedy & Graven, Chartered 150 South Fifth Street, Suite 700 Minneapolis, Minnesota 55402-1299 AGEND) 4GE 107 AL 141\71\711642.v4 CITY OF ALBERTVILLE COUNTY OF WRIGHT STATE OF MINNESOTA RESOLUTION NO.2021-024 A RESOLUTION APPROVING THE ESTABLISHMENT OF TAX INCREMENT FINANCING(REDEVELOPMENT) DISTRICT NO. 19 (FEHN)WITHIN MUNICIPAL DEVELOPMENT DISTRICT NO. 1; AND THE ADOPTION OF A TAX INCREMENT FINANCING PLAN RELATING THERETO WHEREAS,the City of Albertville, Minnesota (the"City")has previously established Municipal Development District No. 1 (the "Development District")located within the City and has caused to be created a development program therefor,pursuant to Minnesota Statutes, Sections 469.124 through 469.133, as amended; and WHEREAS,the City has proposed to approve a tax increment financing plan (the "TIF Plan")for Tax Increment Financing (Redevelopment) District No. 19 (Fehn) (the "TIF District") within the Development District,pursuant to Minnesota Statutes, Sections 469.174 through 469.1794, as amended (the "TIF Act"), all as described in a plan document presented to the City Council of the City (the"City Council") on the date hereof, and WHEREAS,pursuant to Section 469.175, subdivision 2a of the TIF Act, notice of the proposed TIF District was presented to the commissioner of Wright County, Minnesota(the "County")representing the area to be included in the TIF District at least thirty (30) days before the publication of the notice of public hearing; and WHEREAS,pursuant to Section 469.174, subdivision 2 of the TIF Act,the proposed TIF Plan and the estimates of the fiscal and economic implications of the TIF Plan were presented to the Board of Education of Independent School District No. 728 and to the Board of Commissioners of Wright County, Minnesota(the "County") at least thirty (30) days prior to the date hereof, and WHEREAS,the City Council has reviewed the contents of the TIF Plan and on this date conducted a duly noticed public hearing thereon, at which the views of all interested parties were heard. NOW,THEREFORE,BE IT RESOLVED by the City Council of the City of Albertville, Wright County, Minnesota as follows: Section 1. Findings for the Establishment of the TIF District. (a) It is found and determined that it is necessary and desirable for the sound and orderly development of the Development District, and for the protection and preservation of the public health, safety, and general welfare of the City, that the authority of the TIF Act be exercised by the City to provide financial assistance to the TIF District and the Development District. (b) It is further found and determined, and it is the reasoned opinion of the City,that the development proposed in the TIF Plan could not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and the increased market AGENDA PAGE 108 City of Albertville,MN Resolution No.2021-024 Meeting of May 17,2021 Page 2 value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value expected to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the district permitted by the TIF Plan. (c) The proposed development to be financed in part through tax increment financing is necessary to permit the City to realize the full potential of the TIF District and the Development District in terms of redevelopment of blighted property, development intensity, and tax base. (d) The TIF Plan conforms to the general plan for development of the City as a whole. (e) The TIF Plan will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development of the TIF District and the Development District by private enterprise. (f) The TIF District is a redevelopment district under Section 469.174, subdivision 10 of the TIF Act. (g) Reasons and facts supporting all the above findings are set forth in the TIF Plan and in Exhibit A attached hereto and are incorporated herein by reference. The City Council has also relied upon reports and recommendations of its staff and consultants, as well as the personal knowledge of members of the City Council, in reaching its conclusions regarding the TIF Plan. Section 2. Public Purpose. The adoption of the TIF Plan conforms in all respects to the requirements of the TIF Act. The TIF Plan will help fulfill a need to develop an area of the City which is already built up, provide employment opportunities, improve the tax base, and to improve the general economy of the State and thereby serves a public purpose. The City expressly finds that any private benefit to be received by a private redeveloper is incidental, as the tax increment assistance is provided solely to make the redevelopment financially feasible and thus produce the public benefits described. Therefore, the City finds that the public benefits of the TIF Plan exceed any private benefits. Section 3. Approvals, Further Proceedings. (a) The TIF Plan for the TIF District is hereby approved and adopted in substantially the form on file at City Hall. (b) The City staff are authorized and directed to file a request for certification of the TIF District with the County Auditor/Treasurer and to file a copy of the TIF Plan with the Minnesota Commissioner of Revenue and the Office of the State Auditor as required by the TIF Act. (c) The County Auditor/Treasurer is requested to certify the original net tax capacity of the TIF District, as described in the TIF Plan. AGENDA PAGE 109 City of Albertville,MN Resolution No.2021-024 Meeting of May 17,2021 Page 3 (d) City staff, advisors, and legal counsel are authorized and directed to proceed with the implementation of the TIF Plan and to negotiate, draft,prepare, and present to the City Council for its consideration all further plans, resolutions, documents, and contracts necessary for this purpose. Adopted by the City Council of the City of Albertville this 17th day of May,2021. Jillian Hendrickson,Mayor ATTEST: Kristine A. Luedke, City Clerk AGENDA PAGE 110 City of Albertville,MN Resolution No.2021-024 Meeting of May 17,2021 Page 4 EXHIBIT A The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for Tax Increment Financing (Redevelopment) District No. 19 (Fehn) (the"TIF District") as required pursuant to Minnesota Statutes, Section 469.175, Subd. 3 are as follows: 1. Finding that the TIF District is a redevelopment district as defined in Minnesota Statutes, Section 469.174, Subd. 10. The TIF District is a contiguous geographic area within the City's Municipal Development District No. 1, established for the purpose of financing redevelopment in the City through the use of tax increment, with plans for a private redeveloper to redevelop the area for the phased construction of approximately 48,881 square feet of storage, office, and shop space to be leased to a private business to operate its earthwork and demolition services. As provided in the Report of Inspection Procedures and Results,prepared for the City on March 30, 2021, by LHB, Inc., 100 percent of the area of the parcel in the TIF District is occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures and 100 percent of the buildings in the TIF District, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance. (See Exhibit V of the TIF Plan.) 2. Finding that the proposed redevelopment, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the TIF Plan. The proposed redevelopment, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future: This finding is supported by the fact that due to the high costs of redevelopment on the parcel comprising the TIF District, including costs associated with acquisition and site improvements, this project is feasible only through assistance, in part,from tax increment Financing. The redeveloper has stated that without assistance it would be impossible to construct the facility or for the lessee company to locate its business in this location. The City will use tax increment only to reimburse the redeveloper for land acquisition and site improvement costs,plus interest. The increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the TIF Plan: This finding is justified on the grounds that the costs of acquisition and site improvements add to the total redevelopment cost. The City reasonably determines that no other redevelopment of similar scope can be anticipated on this site without substantially similar assistance being provided to the development. a. The City's estimate of the amount by which the market value of the site will increase without the use of tax increment financing is $62,022, representing AGENDA PAGE 111 City of Albertville,MN Resolution No.2021-024 Meeting of May 17,2021 Page 5 nominal annual appreciation of 1% (for the reasons described above) over the life of the TIF District. b. If the proposed redevelopment to be assisted with tax increment occurs in the TIF District, the total increase in market value would be approximately $4,499,750. The increase in market value would be due primarily to new construction within the TIF District. (See Exhibit I of the TIF Plan.) C. The present value of tax increments from the District for the maximum duration of the district permitted by the TIF Plan is estimated to be no more than $1,518,301. (See Exhibit I of the TIF Plan.) d. Even if some redevelopment other than the proposed redevelopment were to occur, the City Council finds that no alternative would occur that would produce a market value increase greater than $2,981,449 (the amount in clause (b) less the amount in clause (c))without tax increment assistance. 3. Finding that the TIF Plan for The TIF District conforms to the general plan for the development or redevelopment of the municipality as a whole. The Planning Commission of the City has reviewed the preliminary plat and PUD for the proposed development as described in the TIF Plan. In addition,the City Council has determined that as proposed,the development is an industrial use permitted under the City's Comprehensive Plan and thus conforms to the general development plan of the City. 4. Finding that the Tax Increment Financing Plan for the TIF District will afford maximum opportunity, consistent with the sound needs of the City as a whole,for the development or redevelopment of Municipal Development District No. I by private enterprise. The project to be assisted by the TIF District will result in increased employment in the City and the State of Minnesota, the redevelopment of a substandard property, and increased tax base of the State, and will add a high-quality development to the City. AGENDA PAGE 112 CITY OF ALBERTVILLE COUNTY OF WRIGHT STATE OF MINNESOTA RESOLUTION NO.2021-025 A RESOLUTION AUTHORIZING AN INTERFUND LOAN FOR ADVANCE OF CERTAIN COSTS IN CONNECTION WITH TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 19 (FEHN) WHEREAS, on the date hereof,the City Council approved the establishment of Tax Increment Financing (Redevelopment) District No. 19 (Fehn) (the "TIF District")within Municipal Development District No. 1 (the"Development District"),pursuant to Minnesota Statutes, Sections 469.124 through 469.133, as amended, and Minnesota Statutes, Sections 469.174 through 469.1794, as amended (the"TIF Act"), and adopted a Tax Increment Financing Plan for the purpose of financing certain improvements within the Development District and the TIF District; and WHEREAS,the City may incur certain costs related to the TIF District, which costs may be financed on a temporary basis from legally available funds of the City; and WHEREAS,under Section 469.178, subdivision 7 of the TIF Act, the City is authorized to advance or loan money from any fund from which such advances may be legally made in order to finance expenditures that are eligible to be paid with tax increments under the TIF Act; and WHEREAS,the City expects to incur costs related to administrative costs of the TIF District(the"Qualified Costs")using City funds legally authorized for such purpose, and to reimburse such funds from tax increments from the TIF District when received; and WHEREAS,the City intends to designate such advances as an interfund loan in accordance with the terms of this resolution and the TIF Act. NOW,THEREFORE,BE IT RESOLVED by the City Council of the City of Albertville, Wright County, Minnesota as follows: 1. The City hereby authorizes the advance of up to $25,000 in legally available City funds to pay the Qualified Costs, together with interest at the rate of 4%per annum (the"Interfund Loan"). Interest shall accrue on the principal amount of each advance from the date of such advance. The interest rate is no more than the greatest of the rate specified under Minnesota Statutes, Section 270C.40 and Section 549.09, both in effect for calendar year 2021, and will not be adjusted. 2. Principal and interest(the "Payments") on the Interfund Loan shall be paid semiannually on each August 1 and February 1 (each a"Payment Date"), commencing on the first Payment Date on which the City receives Available Tax Increment(defined below), or on any other dates determined by the City Administrator,through the date of last receipt of tax increment from the TIF District. AGENDA PAGE 113 City of Albertville,MN Resolution No.2021-025 Meeting of May 17,2021 Page 2 3. Payments on the Interfund Loan are payable solely from Available Tax Increment, defined as 10% of the tax increment from the TIF District received by the City from Wright County, Minnesota in the six-month period before any Payment Date. 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, notes or contracts secured in whole or in part with Available Tax Increment, and are on a parity with any other outstanding or future interfund loans secured in whole or in part with Available Tax Increment. 4. The principal sum and all accrued interest payable under this Interfund Loan are prepayable in whole or in part at any time by the City without premium or penalty. No partial prepayment shall affect the amount or timing of any other regular payment otherwise required to be made under this Interfund Loan. 5. This resolution is evidence of an internal borrowing by the City 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. The Interfund Loan shall not be deemed to constitute a general obligation of the State of Minnesota or any political subdivision thereof, including, without limitation, the City. 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 this Interfund Loan or other costs incident thereto. The City 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. 6. The City may at any time make a determination to forgive the outstanding principal amount and accrued interest on the Interfund Loan to the extent permissible under law. 7. The City 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. 8. City staff and officials are hereby authorized and directed to execute any documents and take any other actions necessary to carry out the intent of this resolution. 9. This resolution shall be in full force and effect from and after its approval. AGENDA PAGE 114 City of Albertville,MN Resolution No.2021-025 Meeting of May 17,2021 Page 3 Adopted by the City Council of the City of Albertville this 17tb day of May,2021. Jillian Hendrickson,Mayor ATTEST: Kristine A. Luedke, City Clerk AGENDA PAGE 115 CITY OF ALBERTVILLE COUNTY OF WRIGHT STATE OF MINNESOTA RESOLUTION NO. 2021-027 RESOLUTION APPROVING CONTRACT FOR PRIVATE DEVELOPMENT WITH HUNTER LAND COMPANY,LLC AND FEHN COMPANIES,INCORPORATED AND AWARDING THE SALE OF,AND PROVIDING THE FORM,TERMS, COVENANTS AND DIRECTIONS FOR THE ISSUANCE OF ITS TAX INCREMENT REVENUE NOTE (FEHN PROJECT) IN THE MAXIMUM PRINCIPAL AMOUNT OF $1,377,817 BE IT RESOLVED BY the City Council (the"Council") of the City of Albertville, Minnesota(the"City") as follows: Section 1. Authorization, Award of Sale. 1.01. Authorization. (a) The City has heretofore approved the establishment of Tax Increment Financing (Economic Development) District No. 19 (Fehn) (the"TIF District"), a redevelopment district, within Municipal Development District No. 1 (the "Project") in the City, and has adopted a tax increment financing plan for the purpose of financing certain improvements within the Project. (b) To facilitate the development of certain property within Project and the TIF District, the City, Hunter Land Company, LLC (the"Owner"), and Fehn Companies, Incorporated(the "Tenant")have negotiated a Contract for Private Redevelopment(the "Agreement"), which provides for the construction and development of approximately 49,200 square feet of storage, office, and shop space for the Tenant's operation of its earthwork and demolition services (the "Minimum Improvements") on the Redevelopment Property (as described in the Agreement), and the issuance by the City of its Tax Increment Revenue Note(Fehn Project) (the"Note")to the Owner. (c) Pursuant to Minnesota Statutes, Section 469.178, the City is authorized to issue and sell its bonds for the purpose of financing a portion of the public development costs of the Project. Such bonds are payable from all or any portion of revenues derived from the TIF District and pledged to the payment of the bonds. The City hereby finds and determines that it is in the best interests of the City that it issue and sell the Note in the maximum aggregate principal amount of$1,377,817, for the purpose of financing certain public costs of the Minimum Improvements. 1.02. Agreement Approved, Issuance, Sale, and Terms of the Note. (a) The City Council on this date has considered the Agreement, and hereby approves the Agreement and authorizes the Mayor and City Administrator to execute such Agreement in substantially the form on file with City, subject to modifications that do not alter the substance of the transaction and are approved by such officials, provided that execution of the Agreement by such officials is conclusive evidence of their approval. AGENDA PAGE 116 City of Albertville,MN Resolution No.2021-027 Meeting of May 17,2021 Page 2 (b) Pursuant to the Agreement,the Note shall be sold to the Owner. The Note shall be dated as of the date of delivery and shall bear interest at the rate that is the lesser of 4.00% or the Owner's actual mortgage financing rate. The City shall receive in exchange for the sale of the Note the payment by the Owner of the Public Redevelopment Costs as defined in the Agreement. The Note will be delivered in accordance with the terms of Section 3.4 of the Agreement. Section 2. Form of Note. The Note shall be in substantially the form set forth in EXHIBIT A attached hereto, with the blanks to be properly filled in and the principal amount adjusted as of the date of issue. Section 3. Terms, Execution and Delivery. 3.01. Denomination, Pam. The Note shall be issued as a single typewritten note numbered R-1. The Note shall be issuable only in fully registered form. Principal of and interest on the Note shall be payable by check or draft issued by the Registrar described herein. 3.02. Dates, Interest Payment Dates. Principal of and interest on the Note shall be payable by mail to the owner of record thereof as of the close of business on the fifteenth day of the month preceding the Payment Date, whether or not such day is a business day. 3.03. Registration. The City hereby appoints the City Administrator to perform the functions of registrar,transfer agent and paying agent(the "Registrar"). The effect of registration and the rights and duties of the City and the Registrar with respect thereto shall be as follows: (a) Register. The Registrar shall keep at its office a bond register in which the Registrar shall provide for the registration of ownership of the Note and the registration of transfers and exchanges of the Note. (b) Transfer of Note. 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 shall 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 shall not be transferred to any person other than an Affiliate, or other related entity, of the Owner unless the City has been provided with an opinion of counsel or a certificate of the transferor, in a form satisfactory to the City, that such 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 such Payment Date. (c) Cancellation. The Note surrendered upon any transfer shall be promptly cancelled by the Registrar and thereafter disposed of as directed by the City. AGENDA PAGE 117 City of Albertville,MN Resolution No.2021-027 Meeting of May 17,2021 Page 3 (d) Improper or Unauthorized Transfer. When the Note is presented to the Registrar for transfer, the Registrar may refuse to transfer the same until it is satisfied that the endorsement on such Note or separate instrument of transfer is legally authorized. The Registrar shall incur no liability for its refusal, in good faith, to make transfers which it, in its judgment, deems improper or unauthorized. (e) Persons Deemed Owners. The City 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 shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on such Note and for all other purposes, and all such payments so made to any such registered owner or upon the owner's order shall be valid and effectual to satisfy and discharge the liability of the City upon such Note to the extent of the sum or sums so paid. (f) Taxes, Fees and Charges. 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 such transfer or exchange. (g) Mutilated, Lost, Stolen or Destroyed Note. In case the Note shall become mutilated or be lost, stolen, or destroyed, the Registrar shall deliver a new Note of like amount, maturity dates and tenor in exchange and substitution for and upon cancellation of such mutilated Note or in lieu of and in substitution for such Note 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 is lost, stolen, or destroyed, upon filing with the Registrar of evidence satisfactory to it that such Note was lost, stolen, or destroyed, and of the ownership thereof, and upon furnishing to the Registrar of an appropriate bond or indemnity in form, substance, and amount satisfactory to it, in which both the City and the Registrar shall be named as obliges. The Note so surrendered to the Registrar shall be cancelled by it and evidence of such cancellation shall be given to the City. If the mutilated, lost, stolen, or destroyed Note has already matured or been called for redemption in accordance with its terms, it shall not be necessary to issue a new Note prior to payment. 3.04. Preparation and Delivery. The Note shall be prepared under the direction of the City Administrator and shall be executed on behalf of the City by the signatures of its Mayor and City Administrator. In case any officer whose signature shall appear on the Note shall cease to be such officer before the delivery of the Note, such signature shall nevertheless be valid and sufficient for all purposes,the same as if such officer had remained in office until delivery. When the Note has been so executed,it shall be delivered by the City Administrator to the Owner thereof in accordance with the Agreement. Section 4. Security Provisions. 4.01. Pledge. The City hereby pledges to the payment of the principal of and interest on the Note all Available Tax Increment as defined in the Note. Available Tax Increment shall be applied to payment of the principal of and interest on the Note in accordance with the terms of the form of Note set forth in Exhibit A to this resolution. AGENDA PAGE 118 City of Albertville,MN Resolution No.2021-027 Meeting of May 17,2021 Page 4 4.02. TIF Fund. Until the date the Note is no longer outstanding and no principal thereof or interest thereon (to the extent required to be paid pursuant to this resolution)remains unpaid, the City shall maintain a separate and special "TIF Fund"to be used for no purpose other than the payment of the principal of and interest on the Note. The City irrevocably agrees to appropriate to the TIF Fund in each year Available Tax Increment. Any Available Tax Increment remaining in the TIF Fund shall be transferred to the City's account for TIF District No. 19 upon the payment of all principal and interest to be paid with respect to the Note. Section 5. Certification of Proceedings. The officers of the City are hereby authorized and directed to prepare and furnish to the Owner of the Note certified copies of all proceedings and records of the City, and such other affidavits, certificates, and information as may be required to show the facts relating to the legality and marketability of the Note as the same appear from the books and records under their custody and control or as otherwise known to them, and all such certified copies, certificates, and affidavits, including any heretofore furnished, shall be deemed representations of the City as to the facts recited therein. Section 6. Effective Date. This resolution shall be effective upon full execution of the Agreement. Adopted by the City Council of the City of Albertville this 17th day of May, 2021. Jillian Hendrickson, Mayor ATTEST: Adam Nafstad, City Administrator AGENDA PAGE 119 City of Albertville,MN Resolution No.2021-027 Meeting of May 17,2021 Page 5 EXHIBIT A TO THE AUTHORIZING RESOLUTION UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF WRIGHT CITY OF ALBERTVILLE No. R-1 $ TAX INCREMENT REVENUE NOTE (FERN PROJECT) Rate Date of Original Issue % , 20 The City of Albertville, Minnesota(the "City"), for value received, certifies that it is indebted and hereby promises to pay to Hunter Land Company, LLC, a Minnesota limited liability company, or its registered assigns (the "Owner"), the principal sum of$ and to pay interest thereon at the annual rate set forth above, but solely from the sources and to the extent set forth herein. Capitalized terms shall have the meanings provided in the Contract for Private Redevelopment, dated as of , 2021 (the "Agreement"),between the City, the Owner, and Fehn Companies, Incorporated, unless the context requires otherwise. 1. Payments. Principal and interest(the "Payments") shall be paid on August 1, 2024 and each February 1 and August 1 thereafter(the "Payment Dates"), to and including the earliest of(i) February 1, 2050, (ii) such date (if any) as the City shall have terminated the Agreement pursuant to its terms, or(iii) such date the Developer has received the principal amount of the TIF Note plus accrued interest thereon (the"Final Payment Date"), in the amounts and from the sources set forth in Section 3 herein. Payments shall be applied first to accrued interest, and then to unpaid principal. Payments are payable by mail to the address of the Owner or such other address as the Owner may designate upon thirty (30) days' written notice to the City. Payments on this Note 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. Simple, non-compounding interest at the rate stated herein shall accrue on the unpaid principal, commencing as of the date of issue. Interest shall be computed on the basis of a year of three hundred sixty (360) days consisting of twelve (12)thirty- (30-) day months, and shall be 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 shall mean, on each Payment Date, ninety-five percent(95%) of the Tax Increment attributable to the Minimum Improvements on the Development Property and paid to the City by Wright County in the six (6) AGENDA PAGE 120 City of Albertville,MN Resolution No.2021-027 Meeting of May 17,2021 Page 6 months preceding the Payment Date. Available Tax Increment shall not include any Tax Increment if, as of any Payment Date, there is an uncured Event of Default under the Agreement. The City shall 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 the City to pay the entire amount of principal of or interest on this Note on any Payment Date shall not constitute a default hereunder as long as the City pays principal of and interest hereon to the extent of Available Tax Increment. The City shall have no obligation to pay any unpaid balance of principal or accrued interest that may remain after the Final Payment Date. 4. Optional Prepayment. The principal sum and all accrued interest payable under this Note are prepayable in whole or in part at any time by the City without premium or penalty. No partial prepayment shall affect the amount or timing of any other regular payment otherwise required to be made under this Note. 5. Termination. At the City's option, this Note shall terminate and the City's obligation to make any payments under this Note shall be discharged upon the occurrence of an Event of Default on the part of the Developer as defined in Section 9.1 of the Agreement,but only if the Event of Default has not been cured in accordance with Section 9.2 of the Agreement. 6. Nature of Obligation. This Note is issued in the total principal amount of $ issued to aid in Financing certain public development costs and administrative costs of a Project undertaken by the City pursuant to Minnesota Statutes, Sections 469.124 through 469.133, as amended, and is issued pursuant to an authorizing resolution (the"Resolution") duly adopted by the City on , 2021, and pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections 469.174 through 469.1794, as amended. This Note is a limited obligation of the City which is payable solely from Available Tax Increment pledged to the payment hereof under the Resolution. This Note 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, the City. Neither the City, the State of Minnesota, nor any political subdivision thereof shall be obligated to pay the principal of and 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 City, 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. Registration and Transfer. This Note is issuable only as a fully registered note without coupons. As provided in the Resolution, and subject to certain limitations set forth therein, this Note is transferable upon the books of the City kept for that purpose at the principal office of the City Administrator of the City, by the Owner hereof in person or by such Owner's attorney duly authorized in writing, upon surrender of this Note together with a written instrument of transfer satisfactory to the City, duly executed by the Owner. Upon such transfer or exchange and the payment by the Owner of any tax, fee, or governmental charge required to be paid by the City with respect to such 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 date. AGENDA PAGE 121 City of Albertville,MN Resolution No.2021-027 Meeting of May 17,2021 Page 7 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 the City 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 City Council of the City of Albertville,Minnesota has caused this Note to be executed with the manual signatures of its Mayor and City Administrator, all as of the Date of Original Issue specified above. CITY OF ALBERTVILLE,NHNNESOTA Mayor City Administrator REGISTRATION PROVISIONS The ownership of the unpaid balance of the Note herein is registered in the bond register of the City Administrator of the City of Albertville,Minnesota,in the name of the person last listed below. Signature of Date of Registration Registered Owner City Administrator Hunter Land Company, LLC Federal Tax ID: AGENDA PAGE 122 CITY OF ALBERTVILLE COUNTY OF WRIGHT STATE OF MINNESOTA RESOLUTION NO. 2021-026 RESOLUTION APPOINTING PLANNING COMMISSIONER WHEREAS,in 2021, Planning Commissioner Bob Zagorski was appointed to a vacant seat on the City Council; and WHEREAS,Planning Commissioner Zagorski's term had 2 years remaining; and WHEREAS,the City Council advertised for the opening on the Planning Commission and received four letters of interest; and WHEREAS,the City Council held Planning Commission interviews on April 19, 2021. NOW,THEREFORE,BE IT RESOLVED,the City Council of the City of Albertville hereby makes the following appointment to the Planning Commission with a term of May 17, 2021 through December 31, 2022: Planning Commission: Adopted by the City Council of the City of Albertville this 17th day of May, 2021. Jillian Hendrickson, Mayor ATTEST: Kristine A. Luedke, City Clerk AGENDA PAGE 123 �lbcrtvillc Mayor and Council Communication May 17, 2021 SUBJECT: CITY CLERK—DOG LICENSE DISCUSSION RECOMMENDATION: It is respectfully requested that the Mayor and Council consider the following: Provide direction to City Staff as to whether they wish to make amendments to the dog licensing requirements in the City of Albertville. BACKGROUND: The Albertville City Code section 6-2-3 requires all dogs over the age of six months old must be licensed by the City. Proof of the dog's rabies vaccination must be submitted in order to obtain a license. The City offers dog licenses for one, two or three years to make it easier to coincide with the dog's rabies vaccination. Upon completion of the dog licensing application process,the City will issue a dog tag to the resident which must be attached to the dog's collar and is not transferable to any other dog or to a new owner of the dog. Below is the number of dog licenses issued per year as of May 2021. The license total does reflect if a residence has more than one dog in their household. Year 2018 2019 2020 2021 2022 2023 Licenses issued 45 59 54 47 29 26 KEY ISSUES: • Albertville's City Code requires all dogs over 6 months of age to be licensed by the City. • A copy of the dog's current rabies vaccination certificate must be received with the dog license application. • The City offers one, two or three year dog licenses. • The City allows up to two dogs per residence and an application must be submitted for each dog in a household separately. • It is believed only a small percentage of dog owners are licensing their dogs through the city. • City licensing has help owners find lost pets. POLICY/PRACTICES CONSIDERATIONS: Whether the Council would like to amend the City Code regarding the licensing of dogs in the City of Albertville. FINANCIAL CONSIDERATIONS: The fee schedule for dog licensing is as follows: S ra ed or Neutered 1 year- $10 2 years - $20 3 years - $30 Unaltered 1 year- $15 2 years - $30 3 years - $45 AGENDA PAGE 124 Mayor and Council Communication—May 17, 2021 Dog License Discussion Page 2 of 2 On average the City collects $1,420 a year in animal license fees. The fees collected annually do not cover the costs associated with the licensing (animal tags, staff time, etc.) or other costs associated with animal control. LEGAL CONSIDERATIONS: The City Council has the authority to consider and approve City licenses and amendments to the Albertville City Code. Department/Responsible Person: Kris Luedke, City Clerk Submitted Through: Adam Nafstad, City Administrator-PWD Attachments: • Albertville City Code Section 6-2-3: Dog Licensing Provisions • 2018 Star Tribune Article AGENDA PAGE 125 6-2-3: DOG LICENSING PROVISIONS: A. License Required: No person shall keep any dog within the City without securing a license therefor from the City Clerk, who shall keep a record of all licenses issued and shall issue a metal tag for each license. Proof of vaccinations shall be submitted in order to obtain a license. 1. The licensee shall at all times remain compliant with all applicable local, State and/or Federal laws, rules and/or regulations. Any violation of any applicable local, State and/or Federal laws, rules or regulations may result in the immediate revocation of the license. B. Fees And Application Requirements: It shall be required of each person owning, keeping, or harboring a dog to pay a license fee to the City Administrator or Finance Director as imposed by this section. The license fee for any dog shall be computed at the rate as established in section 3-1-3 of this Code. Each application for such license shall include a statement, signed by the person applying for the license, which certifies that the dog has been inoculated for rabies not more than twenty four (24) months preceding the date of application. Upon receipt of the license fee and the signed application, the City Administrator or Finance Director shall execute the receipt in duplicate, the original of which shall be given to the person who pays the fee. The duplicate shall be retained in the records of the City Administrator. This receipt shall describe the dog as to color, breed, age, sex, and weight. Any owner shall produce for inspection the license receipt upon the request of the animal control authority. C. Dog Tags: The City Administrator shall procure a sufficient number of metallic tags for delivery of one such tag to the person paying the license fee. It shall be the responsibility of the owner of the dog for which said tag was obtained to permanently attach the tag to the collar of the dog in such manner that the tag may be readily seen. The tag is not transferable to any other dog or to a new owner of the dog. If a tag is lost or stolen, the owner may obtain a new tag by surrendering the license receipt for the first tag and by paying an additional fee as established in section 3-1-3 of this Code. D. Unauthorized Use Of Dog License Receipts, Tags And Certificates: It shall be unlawful for any person to use for any dog a license receipt, license tag, or a rabies inoculation certificate issued to another person or dog. E. Commercial Kennel License: A commercial kennel license may be issued by the animal control authority. F. License Limit: Except for commercial kennels, no property shall contain more than two (2) dogs over the age of six (6) months at a time. A property may contain three (3) dogs if one or more are service animals as defined in this chapter. (Ord. 2018-07, 3-5-2018) AGENDA PAGE 126 LOCAL No license, no problem: More cities eliminating pet licenses Growing number of cities in the metro area are eliminating the requirement By Erin Adler(https://www.startribune.com/erin-adier/6370491n Star Tribune NOVEMBER 5,2018—12:12PM From Burnsville to Crystal,many cities in the metro area no longer require residents to obtain pet licenses,calling the practice out-of-touch in an age when rabid dogs rarely roam and people have other ways to find their missing pets. "What I've seen is some cities finding it is more of a headache...than it is a benefit,"said Graham Brayshaw,head veterinarian for the Animal Humane Society in Golden Valley. The latest municipalities to drop pet licenses include Mound,in 2016,and Orono,in 2017.The Crystal City Council in August informally decided to end licensing,and Burnsville officials agreed to do so at a work session last month(but likely won't vote on it until next year). The main reason,say city officials,is mass noncompliance.Few pet owners keep licenses up to date,if they get them at all. "We're only penalizing people who are rule followers,"said Jeff Kolb,a Crystal City GALLERY Council member,adding that those individuals probably already are responsible pet L owners. Pet licenses once purported to ensure that animals were vaccinated and could be easily reunited with their owners if lost.Yet,out of 8,000 households,only a few hundred Crystal residents have licenses.The fees probably don't even rover administration costs, Kolb said. "We're not out there enforcing,"said Catherine Pausche,Mound city finance director. Orono Police Chief Correy Farniok said that social media and microchips combine to make a highly effective way to locate lost pets,recalling a Facebook post by an officer on a missing dog that was shared 4,000 times in an hour. Ideas about pets have changed,said Burnsville City Council Member Cara Schulz. People used to keep them outside,let them run loose and brought them to the vet only rarely. "Now your pets sleep on the bed with you,"she said. Some cities say that licenses still serve a purpose.Minneapolis'website highlights the revenue they generate,which pays for the sheltering and feeding of lost pets. Changing practices The practice of licensing pets emerged in the 1950s in rural areas as a way to figure out who they belonged to,Schulz said.During a rabies scare in the 1970s,licenses were a means to show that the pets were up-to-date on vaccinations. Minnesota law doesn't require cities to license pets.That's up to municipalities,which can enact ordinances specifying who must get a license,for what period and for how much. Some cities require dogs,cats and other small pets to be licensed,while others license only dogs.Delano charges nothing for a license,while Minneapolis charges$75 to license an unsterilized pet. AGENDA PAGE 127 While some cities,like Bloomington,offer lifetime licenses with a one-time fee,others want residents to renew every year or two. But Kevin Toskey,a research attorney for the League of Minnesota Cities,said there was "definitely a trend happening with[cities]not enforcing or repealing pet licensing." There are a variety of reasons.Technology,including dog facial recognition software and microchips,is changing how we find lost animals,said Brayshaw.Microchips are now implanted between the shoulder blades of every dog at the Animal Humane Society and by many rescue organizations. About a third of the pets belonging to the 85 million U.S.pet-owning households are microchipped,said Kate Vossen,a spokeswoman for HomeAgain,a popular microchip company.HomeAgain has reunited more than 2 million pets with their owners,she said. City officials and experts said having pets wear a collar with identification and vaccination tags is still the most effective way to bring them home. As for vaccinations,rabies is far less common today than in the past,Schulz said. Owners already must present vet records to take out pet insurance or enroll in doggy day care.Farniok said that when a dog bite is reported,police go directly to the owner to ask about vaccinations rather than checking city records. Making a statement The Minneapolis city website says that if pets are licensed,they are three times more likely to be returned if missing.In some cities,licensing fees help offset the costs of dog parks,and a license is needed to visit them. Not every pet has a microchip,and microchips aren't infallible,Brayshaw said.He added that"dead-end"microchips,which lack current contact information for owners,are common. Brayshaw said there are more important animal issues to focus on than licensing, though he wondered if licensure and vaccination might be more effective if mandated by counties or states rather than cities. Few suburban pet owners recently interviewed said they had pet licenses.Some said they didn't know they existed,and others didn't see the point. Lisa Bernier-Perleberg said she's lived in Crystal for 16 years but never purchased a license for her pets."We always figured if we did get caught,it would be easier to just pay a fine,"she said. As her two Jack Russell terrier mixes,Fred and Wilma,frolicked at Burnsville's Alimagnet Dog Park,Mary Dean said she thought a dog license was"more paperwork than it's worth."Dean,of Apple Valley,said she might change her mind if license revenue went to animal shelters. A few pet enthusiasts said there might be value in licensing pets.Amanda Waltz said she went 13 years without getting a dog license,but she wondered if having one would have helped when her dog nipped a kid on a bike. "Perhaps if licensed,[the dog]wouldn't have been slapped with a potentially dangerous animal label,"said Waltz,of Crystal. Kurt Martinson of Burnsville has a license for his mini Labradoodle,Wilma. "I'm kind of civic-minded,"he said."If you're going to take on the responsibility of a dog, $10 isn't a big deal.It makes a statement." Erin Adler is a suburban reporter covering Dakota and Scott counties for the Star Tribune,working breaking news shifts on Sundays.She previously spent three years covering K-12 education in the south metro and five months covering Cancer County. AGENDA PAGE 128 �lbcrtvillc Mayor and Council Request for Action May 17, 2021 SUBJECT: FINANCE-DRIVEWAY IMPROVEMENT ASSESSMENT RECOMMENDATION: It is respectfully requested that the Mayor and Council consider the following: MOTION TO: Approve Driveway Replacement Contract for property owner Jarrod& Stephanie Deehr located at 6473 East Laketowne Drive NE Albertville, MN 55301 -PID 101-083-003050. BACKGROUND: In July of 2018,the City Council approved the driveway replacement program. According to the policy, the City would pay the contractor and the cost of the improvement would be assessed to the property. The terms of the special assessment option offered to the homeowners was that the special assessment would be payable over five years with a 5%interest rate. The first installment would be payable with the 2022 taxes payable. The City will designate funds for the Driveway Replacement Program up to $30,000 per year for the projects with a maximum principal loan balance, for the fund, of$150,000 at any point in time. The initial funding would be taken from the Capital Reserves. KEY ISSUES: • The City has the statutory right to special assess improvements. • Per policy, the program will finance up to $8,000; however,the Property Owner is requesting $7,795.00 to be paid to Omann Contracting Companies upon completion. • Shall include an upfront fee of$100 for costs paid by the property owner to the City. FINANCIAL CONSIDERATIONS: City staff has reviewed and recommends approval of the Driveway Replacement. Responsible Person/Department: Tina Lannes, Finance Director Submitted Through: Adam Nafstad, City Administrator-PWD Attachments: • Omann Contracting Companies Quote,Non-Executed Driveway Agreement AGENDA PAGE 129 Contract _ No. 75885 . ... ...-- . Anm Omann Contracting Companies Inc. P.O. Box 120 Albertville, Mn 55301 Contracting Companies, Inc. Residential/ Commercial ( Industrial Contract Date312612021 Providing over 40 years of Quality Service Contractor Submitted to:Jarrod Deehr Project Name: Jarrod Deehr Address: 6473 E. Laketown Drive Project Location 6473 E. Laketown Drive Albertville, MN 55301 Albertville, MN 55301 Phone#'s: 612-210-6979 Alt# NOTE: This Proposal may be withdrawn by us if not accepted within the stated time limit. 30 days from above date. I agree to pay the BALANCE DUE upon completion unless specified otherwise in terms below. Omann Contracting Companies Inc.reserves the right to charge 1.5%(annual 18%)finance charge on the unpaid balance per month. I also agree that if I have not paid the full BALANCE DUE upon completion, I will pay Omann contracting companies Inc.an additional amount of 10%of the remaining balance plus any and all legal or lien fee's that may incur. Terms of 113 Down Remaining Balance Upon Completion Payment Omann Contracting Companies Inc.will not guarantee drainage on surfaces with less then or equal to 1%slope.Minor puddling may occur ***Subsoil Disclaimer: Due to many variations of soil types and unknown subsoil conditions, extra soil correction work may be needed to complete the job properly at an additional cost to the owner. All additional work will be approved before commencement *** Underground Utilities: Omann Contracting will notify Gopher State One call to locate any public utilities. Omann Contracting will not be liable for any damages to any private underground pipes, lines,wires, etc. both known and unknown. *** Existing Site Surfaces: Due to the type of work being performed, it may be neccessary to cross or work from existing concrete, lawn, or asphait. Omann Contracting Companies Inc.will not be held responsible for ANY damage incurred to these existing surfaces from the work being performed Work To Be Done: Existing Driveway Remove and Replace; approx. 1,570 S.F. (175 S.Yds.) Remove all old asphalt and excavate to 8H' below finished grade; haul debris off site and dispose. Install 6"compacted average Class 5 Road Base. Pave with approx.3" Modified Super Pave driveway mix and roll to 2.5"compacted average. $7,795.00 3 Year Standard Warranty Materials and Workmanship *Garage slab block corefill if needed will be$350. *If extensive foundation wall repair is needed due to deterioration of block. Extra charges may apply. ($600.00-$800.00) *Additional base correction if needed will be extra. $500,00 per load. (12cy) To include export and disposal, import and placement. *Omann Contracting is not responsible for any post landscaping needs or damage to landscape during installation. *Omann Contracting is not responsible for any damage to trees or tree root systems where installation takes place. *Owner is responsible to have sprinkler heads flagged or moved. Please Sign Reverse side and Return this copy Pg 1 Of 2 Omann Contracting Companies Inc.P.d3, 42aW9�i LAeaux Ave.NE Albertville,MN. 65301 763-497-8259 bus. 763-497-8261 fax LIEN NOTICE: (A.) PERSONS OR COMPANIES FURNISHING LABOR OR MATERIALS FOR THE IMPROVEMENT OF REAL PROPERTY MAY ENFORCE A LIEN UPON THE IMPROVED LAND IF THEY ARE NOT PAID FOR THE THEIR CONTRIBUTIONS,EVEN IF THE PARTIES HAVE NO DIRECT CONTRACTUAL RELATIONSHIP WITH THE OWNER. (B.) MINNESOTA LAW PERMITS THE OWNER TO WITHHOLD FROM THE OWNERS CONTRACTOR AS MUCH OF THE CONTRACT PRICE AS MAY BE NECESSARY TO MEET THE DEMANDS OF ALL OTHER LIEN CLAIMANTS,PAY DIRECTLY THE LIENS AND DEDUCT THE COST OF THEM FROM THE CONTRACT PRICE,OR WITHHOLD AMOUNTS FROM THE OWNERS CONTRACTOR UNTIL EXPIRATION OF 120 DAYS FROM THE COMPLETION OF THE IMPROVEMENT UNLESS THE CONTRACTOR FURNISHES TO THE OWNER WAIVERS OF CLAIMS FOR MECHANICS LIENS SIGNED BY PERSONS WHO FURNISHED ANY LABOR OR MATERIALS FOR THE IMPROVEMENT AND WHO PROVIDED THE OWNER WITH TIMELY NOTICE. Removal: (C.) Asphalt is a recyclable material. If materials provided and installation costs are not paid in full,this material will be removed with a three day written notice to the property Owner and/or contract holder from Omann Contracting Companies Inc. All costs incurred during this removal will be charged to the contract holder,as the job is not complete until final payment is received. This cost will also include laborthat was incurred to install this base and asphalt. During removal of asphalt,any property damage will be the responsibility of the contract holder. The signature below will serve as acknowledgement of this statement and will grant Omann Contracting Companies Inc the right to access the property to perform the removal of the material.(Not applicable to seal coating projects.) ATTORNEY FEES:(D.) IF CONTRACT HOLDER FAILS TO PAY OMANN CONTRACTING COMPANIES INC.PURSUANT TO THIS CONTRACT AND ANY CHANGE ORDERS,IF ANY,CONTRACT HOLDER SHALL BE RESPONSIBLE FOR ALL OMANN CONTRACTING COMPANIES INC.'S COSTS OF COLLECTIONS INCLUDING,BUT NOT LIMITED TO,REASONABLE ATTORNEY FEES. SEAL COATING: Orrann Contracting Companies Inc.will not be responsible for tracking of oil or rock in grass,doorway,or building after installation of seal coating. HOLD-BACK: I agree that if I have a dispute about the work that has been completed,I will hold-back no more than an amount equal to(5%)percent of the BALANCE DUE until the work has been completed. I also agree that once the work has been reasonably completed. I will pay the amount that I held back within two(2)days after the work has been completed and that I if I do not, I will owe to Omann Contracting Companies Inc.an additional amount of 10%of the balance due. All material is guaranteed to be as specified. All work to be completed in a workmanlike manner according to standard practices. Fiber-mix asphalt retards cracking and does not guarantee against cracking. Due to the Variation of climate minor cracking may occur. Due to the nature of the freeze-thaw cycle, minor settling may occur over time.Omann Contracting is not responsible for any damage,cracking nor for any defects attributable 10 the failure to properly maintain the completed asphalt. Standard warrantee is to include;bituminous materials against break up,and labor against workmanship, unless otherwise specified.Omann Contracting is not responsible for the damage of,cracking or breakup of existing concrete and asphalt both during and after the work is performed. Any alteration or deviation from the specifications above involving extra costs will be executed only upon consent,and will become an extra charge over and above the estimate. All agreements contingent upon strikes,accidents or delays beyond our control including the weather. Owner to carry fire, tornado and other necessary insurance. Our workers are fully covered by Workman's Compensation Insurance. Contract Number 75885 Omann Contracting Companies Representative: Tom Cleveland ACCEPTANCE OF PROPOSAL: The above prices,specifications and conditions are satisfactory and are hereby accepted. I verify there are no current liens orjudgments on above said property. You are authorized to do the work as specified. Payment will be made as outlined. Authorized Signature Signature X Date (please print) PERSONAL GUARANTEE: I personally guarantee the payment of the amount owed to Omann Contracting Companies,Inc. Signature X Date (please print Credit Reference: (Bank,Credit Union, Etc.) Please Sian and Return this Copy Ill 2Of2 Omann Contracting Companies Inc.P.04§RJ1P2b,PMlf LAeaux Ave.NE Albertville,MN. 55301 763-497-8259 bus. 763-497-8261 fax ZU ;3D CS plo 1 a1 rLL r 04AI ��1 c-- t Z c� �' t;4jejC--&L,,3,,j,Zj?AGENDA PAGE 132 CITY OF ALBERTVILLE WRIGHT COUNTY STATE OF MINNESOTA DRIVEWAY REPLACEMENT AGREEMENT THIS AGREEMENT, made and entered into this day of , 2021, by and between Jarrod & Stephanie Deehr hereinafter called the "Landowner", and the City of Albertville, a municipal corporation, hereinafter called the "City". WITNESSETH WHEREAS, the City pursuant to its economic development authority has created a program for property owners within the City to apply to the City for financing to replace and/or improve the property owner's driveway at property owner's expense; and WHEREAS, the Landowner is the owner of certain real property located at 6473 East Laketowne Drive NE, Albertville, MN 55301, PID No. 101-083-003050 hereinafter called the "Property"; and WHEREAS, Landowner has requested to participate in the City's driveway replacement program and has requested that any and all fees and costs incurred by the City in connection with the repaving of the Driveway be adopted by the City as a special assessment against the benefited Landowner's Property; and WHEREAS, the Landowner has determined the scope and extents of the driveway improvements they wish to make, and has obtained quotes and/or negotiated a price and contract terms with a contractor of their choosing for such improvements, and has found the driveway improvements feasible; and WHEREAS, a $100 charge shall be paid to City for the costs of processing the special assessment for the repaving of the Driveway; and WHEREAS,the proposed assessment to the Subject Property is estimated to be $ , ("Assessment"). NOW, THEREFORE, in consideration of the foregoing premises, and the following terms and conditions, the parties agree as follows: 1. Upon completion of the work, the City agrees to pay , the Landowner's contractor,the amount of$ , for the driveway improvements. 1 AGENDA PAGE 133 2. Landowner agrees that the City may certify all costs incurred by the City in removing and replacing the driveway on to the real estate taxes of the Property. Landowner, it's successor or assigns, agrees not to contest or appeal such assessment/certification and waives all statutory rights of appeal under Minnesota Statutes, including Minnesota Statutes Chapter 429, Minnesota Statutes § 366.012 or any other applicable statute to the extent of the costs incurred by the City under the terms of this Agreement which are estimated to be approximately$ Landowner retains the right to appeal any certification above $ pursuant to Minnesota law. The certification levied shall be payable in equal annual principal installments extending over a period of five years, and shall bear interest at a rate of 5 % per annum. 3. The action or inaction of the City shall not constitute a waiver or amendment to the provisions of this Agreement. To be binding, amendments or waivers shall be in writing, signed by the parties and approved by written resolution of the City Council. The City's failure to promptly take legal action to enforce this Agreement shall not be a waiver or release. 4. Landowner agrees to waive any and all claims whatsoever against the City and its governing Council, agents, employees, contractors, and representatives as a result of the work performed under this Agreement including, but not limited to, any claims for poor materials or workmanship and any claims for a taking under either the state or federal constitutions, Section 1983 of Title 42 of the U.S. Code, or any other laws. Further, the Landowner shall hold the City, its governing Council, agents, employees, contractors, and representatives harmless from any and all claims made by Landowner or third parties for damages sustained or costs incurred as a result of the work performed by the City under the terms of this Agreement. The Landowner shall indemnify the City and its officers and employees for all costs, damages or expenses which the City may pay or incur in consequence of such claims, including attorney's fees. 5. In the event of poor materials or workmanship in performance of the work under this Agreement, the City shall not be responsible for any loss the owner may suffer, and the owner's remedy shall be against the contractor and not the City. The City shall pass through to the Landowner any warranty that the City obtains from the contractor who performed the work. 6. Third parties shall have no recourse against the City under this Agreement. 2 AGENDA PAGE 134 7. This Agreement represents the full and complete understanding of the parties and neither party is relying on any prior agreement or statement(s), whether oral or written. 8. Should Landowner violate any of the terms of this Agreement, the Landowner shall pay all professional fees incurred by the City as a result of City's efforts to enforce the terms of this Agreement. Said fees include attorney's fees and any other professional fees incurred by the City in attempting to enforce the terms of this Agreement. IN WITNESS WHEREOF, the City and the Landowner have caused this Agreement to be duly executed on the day and year first above written. CITY OF ALBERTVILLE LANDOWNER By Jillian Hendrickson, Mayor By Kristie Moseng, Deputy Clerk 3 AGENDA PAGE 135 �lbcrtvillc Mayor and Council Request for Action I f May 17,2021 SUBJECT: ADMINISTRATION-APPROVE PARTICIPATION IN THE WRIGHT COUNTY ECONOMIC DEVELOPMENT AUTHORITY RECOMMENDATION: It is respectfully requested that the Mayor and City Council consider the following motion: MOTION TO: adopt Resolution No. 2021-022 opting the City of Albertville to participate in the Wright County Economic Development Authority. BACKGROUND: The formation of the Wright County Economic Development Authority (EDA)was recommended by an Advisory Committee which included city and township representatives. The Advisory Committee met in August and October 2020 and provided a report in November of 2020 to the Wright County Board which passed a resolution establishing the Wright County EDA. Under state law, county EDAs may operate only in cities and townships that have adopted resolutions electing to participate in it. KEY ISSUES: • The Wright County Board established the Wright County Economic Development Authority to guide economic growth within Wright County. • The EDA operates under the authority of Minnesota Statutes, Section 469.090 through 469.1082 and has more legal authority to pursue the repurposing of public assets than do counties themselves.. • The EDA will partner with local cities and townships as well as the Wright County Economic Development Partnership and support their efforts to achieve specific projects and advance broader initiatives. • The EDA will seek to access state and federal resources that are mainly available to larger public development agencies. • No funding is necessary. While the EDA has taxation authority, the Wright County EDA has stated it will not levy taxes. If the EDA ever decides to levy an EDA tax, cities and townships will have the option to withdraw at that time. LEGAL ISSUES: The Mayor and City Council have the authority to approve the City of Albertville's participation in the Wright County Economic Development Authority. Submitted by: Adam Nafstad, City Administrator-PWD Attachments: • Wright County EDA FAX Sheet • Wright County EDA Presentation • Resolution No. 2021-022 AGENDA PAGE 136 04'a 'M I WRIGHT HT U T &Air ECONOMIC DEVELOPMENT AUTHORITY What is the Wright County Economic Development Authority? The Wright County Economic Development Authority(EDA) is a local authority, a subdivision of Wright County with the primary objective of shepherding economic growth within Wright County. The EDA operates under the authority of Minnesota Statutes, Sections 469.090 through 469.1082. How was the EDA established? The formation of the EDA was recommended by an Advisory Committee which included city and township representatives. The committee met in August and October 2020 and provided a report in November 2020. In November 2020, The Wright County Board passed a resolution establishing the Wright County EDA. What will the EDA do? Facilitate and guide redevelopment of county owned properties. County EDAs have much more legal authority to pursue the repurposing of public assets than do counties themselves. The EDA will facilitate and guide the redevelopment of the current Government Center and Health & Human Services Building located in Buffalo. These two properties are anticipated to be vacated by Wright County staff at the end of 2021. Partner with local communities. The EDA will partner with local cities and townships as well as the Wright County Economic Development Partnership (WCEDP) and support their efforts to achieve specific projects and advance broader initiatives. Access state and federal resources. The EDA will seek to access state and federal resources that are available mainly to larger public development agencies. EDA Board Members & Staff Darek Vetsch, President Christine Husom,Vice-President Mark Daleiden, Board Member Ph: (763) 682-7687 Ph: (763) 682-7697 Ph: (763) 682-7686 Darek.Vetsch@co.wright.mn.us Christine.Husom@co.wright.mn.us Mark.Daleiden@co.wright.mn.us Mary Wetter, Board Member Michael Kaczmarek, Board Member Teri Lacherrneler, Board Member Ph: (763) 682-7696 Ph: (763) 682-7685 Ph: (763) 464-4732 Mary.Wetter@co.wright.mn.us Mike.Kaczmarek@co.wright.mn.us teri.lachermeier@ci.buffalo.mn.us Phil Kern, Board Member Lee Kelly, Executive Director Elizabeth Karels, Project Administrator Ph: (763) 972-0565 Ph: (763) 682-7377 Ph: (763) 684-8604 pkern@delano.mn.us Lee.Kelly@co.wright.mn.us Elizabeth.karels@co.wright.mn.us What will the EDA NOT do? The EDA does not intend to enact its own levy. AGENDA PAGE 137 In establishing the EDA, the Wright County Board was clear that it has no intent for the EDA to levy its own dedicated property tax. EDA activities will be funded with Wright County resources. The EDA will be limited to economic development. Although some county EDAs also exercise powers available to housing and redevelopment authorities (HRAs), the Wright County EDA's powers are limited to economic development. The EDA does not intend to lead any development projects except for the development of county owned properties. With its focus on partnering with local communities and the WCEDP to achieve their objectives, the EDA does not expect to lead any projects other than the redevelopment of the Government Center and Health and Human Services Building. The EDA's role will be to augment the resources that other entities are bringing to advance projects throughout Wright County. What does local participation mean? Under state law, county EDAs may operate only in cities and townships that have adopted resolutions electing to participate in the EDA. Opting into the EDA If a city or township chooses to opt into the EDA's area of operation, the entity will be included in the EDA's area of operation. Opting in does not impose any obligation, financial or otherwise on the participating city or township. Opting in allows the participating city or township to take advantage of tools offered by the EDA, which may include tax increment financing (TIF), tax abatement, business loan programs and grant programs. Every five years, cities and townships having opted into the EDA may elect to withdraw, per Minnesota Statute, Section 469.1082 Subdivision 5. Opting out of the EDA If a city or township chooses to opt out of the EDA's area of operation, the EDA is not allowed to assist any development project in that community, even if requested by the city or township. Future EDA levies If the EDA ever decides to levy an EDA tax, all participating entities will have the option to withdraw from the EDA and not be subject to the EDA levy. Updated March 12,2021 AGENDA PAGE 138 w c� IL _ Q O N Ii z 0 z W Z O w c9 O Z W Q � } Z r z ~¢ O Z Z 0 oa W F a Q 0 Iw a.� w � - � O _ co a. j tj3 20 F- LU Q W ado N � 4-0 E Q E 0 O O W � U H Q O EC o cn O w _0 E o _ - H L OV 't CB }, N w � >% N N � m > L a Z Q (� g Z �"' Q w OZ � � � L o U W � E 0 o O E L cn I--' a N O N _0 .� •cn Jcn cn W cn cn o w > iz a� W � 0 Q 4 � O 72 > O W o L) U W � O � O = U w O O m 0 > — � � cn U F U O O 7 U CV O O Q Z O (B = " 0 O O W _0 O U N 0 cn Z o _ u_= vi g N 4-0 70 � CR o4-04-0 LU q3 o U T w - a)a ; a)0 co co CU � a� W o � o �, _ � co U Q o •� O J O N m m � � � _ � � � Q a) N U) m _ M O � ca o0 a) U 0- O U Q (6 O (6 U U U U- Q 0- W Q o0 � o 0 U o a) a) a) O E 0 �>'+ CDL o a > a 0 N T . o w > E a) w H m 0 Q o o a) o Z o N o > O 70 W W }, _ a E H }, — o 0 J J cn Q N N -0 x a Q Q Q °� a C) C) C) = W W W U a)a) a) a) •� 0 O p = N > Q ca (\■ O Z Q 0 0 N LU Q � N N O 0) p E Z � N Q N O ' > LU U (6 (6 ; Cl) Q N v a _ O Q U Q N C U a ,C ¢ U � °W a Q ui o o ¢ o 0 Q � •� � U X > (6 a Q J O O 0 Q LU �' W Q j LL U � 0) �_ ° C J QQ c6 0 N i � U w "�'' Cl) LUes• U � � U LU 7j-D QaiL7-- Q- U) o O o � -rQ0oom Q 0 a0 O "-' ° 0) � C:-0 � o � > � � (D L (D C:J) -0 C)) 70 « (6 LU > N Q C:70 N � N N (U O O O O W e - 4-- 0 O OU) -1--+ Q Q O p O W O N �--+ 70 Q T w (�• m O p CL N ap O o �' O w W }' W a) }' F- U 70 70 N N LU w m CDL CDL CD _ - H U to to LU a Q O O 0 a Q E Q U p mp c� a) = W a) U) cn Lu N N N .� p = Z V °' U E 2 p 'L O N � u < LO w Q Q 0 Z w Q CITY OF ALBERTVILLE COUNTY OF WRIGHT STATE OF MINNESOTA RESOLUTION NO. 2021-022 RESOLUTION OPTING THE CITY OF ALBERTVILE TO PARTICIPATE IN THE WRIGHT COUNTY ECONOMIC DEVELOPMENT AUTHORITY WHEREAS,The City of Albertville, Minnesota(the"Municipality") is located within Wright County, Minnesota(the"County"); and WHEREAS,pursuant to a resolution adopted by the Board of Commissioners of the County on November 24, 2020, the County established the Wright County Economic Development Authority (the "EDA") in accordance with Minnesota Statutes, Section 469.090 through 469.1082, as amended (the EDA Act"); and WHEREAS, Section 469.1082, subd. 5 of the EDA Act provides that the area of operation of the EDA shall include all cities and townships within the County that have adopted resolutions electing to participate in the EDA; and WHEREAS,the governing body of the Municipality has determined that it is in the best interests of the Municipality to elect to participate in the EDA; and WHEREAS,the Municipality may make an election to withdraw from participation in the EDA every fifth year following the adoption of the resolution electing to participate, all in accordance with the terms of Section 469.1082, subd. 5 of the EDA Act; and WHEREAS,notwithstanding Section 469.1082, subd. 5, if the EDA enacts an EDA levy, the EDA will notify the Municipality of the enactment of such levy and the Municipality shall have the opportunity to withdraw its participation in the EDA prior to the levy going into effect. NOW, THEREFORE,BE IT RESOLVED,by the City Council of the City Albertville, Minnesota as follows: 1. The Municipality hereby elects to participate in the EDA. 2. The election to participate in the EDA shall take effect on the date of adoption of this approval and may only be withdrawn in accordance with Section 469.1082, subdivision 5 of the EDA Act. Adopted by the City Council of the City of Albertville on this 17th day of May, 2021. Jillian Hendrickson, Mayor ATTEST: Kristine A. Luedke, City Clerk AGENDA PAGE 146 .A,lbcrtvi11- City Administrator's Update Small Town Living.Big CRy LIFe. May 13, 2021 GENERAL ADMINISTRATION City Website Rebuild: Staff is continuing to work with Granicus on the City's website rebuild. The tentative go live date is scheduled for June 1, 2021. Planning Commission Vacancy: Included as an agenda item is Planning Commission appointment that was moved from the May 3 City Council meeting. I will provide the candidate ranking to assist with Council's consideration. Parks Committee Vacancy: The Parks Committee will be reviewing letters of interest received at their next meeting. Fehn Companies TIF: The public hearing on the TIF will be continued at Monday's meeting. American Rescue Plan Act: The recently passed act includes $65 billion in recovery funds cities. Albertville's share is estimated to be $860,000. Albertville is expected to receive the first half distribution around June 9, 2021 and the second distribution a year later. The funds must be spent by December 31, 2024. Currently the use of funds is vague, but in the coming weeks we hope to receive more direction on the use of the funds (waiting on the U.S. Treasury) and reporting requirements. Central Park Plans: The Park Committee is reviewing options and costs for internal trails and parking improvements at Central Park. Advanced Volumetric Alliance: We have received notice that both JCF and MIF grants through DEED have been approved for AVA. Together the two grants will provide $625,000 toward the project. AVA has submitted for Building Permit and is working to finalize the development agreement. STMA Referendum Steering Committee: The Committee met again on May 4 and its next meeting will be May 18. Information regarding the District's finances and a potential referendum can be found at www.stma.kl2.mn.us/domain/4690 Arena Board: The Arena Board met this past Monday to review the 2020 audit. The Arena received an unqualified (highest) opinion for 2020. The Arena closed the year with revenues exceeding expenditures by $2,141, excluding depreciation. The Arena has a healthy capital reserve of$145,000. AGENDA PAGE 147 ENGINEERING/PUBLIC WORKS 2021 Street Project: The project has been awarded and the pre-construction meeting will be held in May. The first project newsletter was recently mailed. Construction will begin after Friendly City Days. Local Road Improvement Program: The grant application has been submitted and awards are expected in May. Skate Park/Basketball Court: The Skate Park contract has been finalized and we expect construction is scheduled to be May 24. We anticipate a 5 to 7 week build period and plan open the skate park mid-July. Construction of the basketball court will follow. BNSF Quiet Zone: I met with the County to review the current quiet zone requirements. BNSF informed the County they are moving forward with the gates and arms at the CSAH 19 and CSAH 37 crossings later this summer. I will get more information from FRA on the risk index and options for wayside horns and report back to the Council. City Administrator's Update Page 2 of 2 May 13, 2021 AGENDA PAGE 148