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HomeMy WebLinkAbout2010-12-15 PACKET 04.K.COUNCIL ACTION REQUEST: Consider ratifying a purchase agreement between the EDA and the South Washington Watershed District. STAFF RECOMMENDATION: Ratify the purchase agreement. SUPPORTING DOCUMENTS: M MEMO/LETTER: Memo from Ryan Schroeder. ❑ RESOLUTION: ❑ ORDINANCE: ❑ ENGINEERING RECOMMENDATION: ❑ LEGAL RECOMMENDATION: OTHER: Attachments. ny /Aaministrator /Aok) Date COUNCIL ACTION TAKEN: MI / APPROVED ❑ DENIED [I OTHER I City of , Cottage Grovs I= i Minnesota I To: Honorable Mayor and City Council Members From: Ryan R. Schroeder, City Administrator Date: December 9, 2010 Subject: Approval of EDA Purchase Agreement with SWWD Enclosed, please find an agenda item for EDA consideration at their meeting of December 14, 2010. The requested action of the EDA, and therefore requested ratification of Council, is to approve an agreement to sell the property at 6043 East Point Douglas (Wheels for Travel) to the South Washington Watershed District. The sales price is at the cost of acquiring the property by the EDA. Council Action: By motion ratify a purchase agreement between the EDA and the South Washington Watershed District. h _ 12"N . ..... Minnesota To: Economic Development Authority From: Ryan R. Schroeder, City Administrator Date: December 9, 2010 Subject: Wheels For Travel The EDA previously approved a purchase agreement in the amount of $420,000 for the Wheels for Travel property at 6043 E. Point Douglas Road. The Board will recall that the purchase price is in the amount of the appraisal conducted by Evergreen Land Company. Evergreen will also be conducting the relocation analysis at an estimated cost of $3,000 (see enclosed). One of the contingencies added to the purchase agreement by the EDA was a purchase agreement between the EDA and the South Washington Watershed District (SWWD) which results in the transfer of the property to the SWWD for their use as a storm water facility. Enclosed is the purchase agreement that will be presented to the SWWD Board for approval during their meeting on December 14, 2010. We are requesting EDA approval of this agreement. The EDA will close on this property prior to year end. The agreement with the SWWD is for a closing on or before May 1, 2011. The reason for the delay is two-fold. First, the SWWD will not have sufficient funds in the appropriate account until that time. Second, under our agreement with the fee owners they are allowed to continue to occupy the property post closing and upon notice to vacate by the EDA which is anticipated around April 1. The agreement with the SWWD provides that the EDA will recover our costs of acquisition to include purchase price, relocation consultant and relocation expenses. The SWWD is acquiring the property "as is" and will be responsible for removal of any structures or appurtences (such as well and septic) that exists on the property at closing. EDA Action: By motion authorize a purchase agreement between the SWWD and ED or 6043 East Point Douglas Road as described above Evergreen Land Services Company 4131 Old Sibley Memorial Highway, Suite 201 Eagan, MN 55122 TeL (651) 882 -0200 Fax: (651) 882 -6564 LAND SERVICES GOMPANY Aatuisition and Rd.ca ti( n specialist, August 11, 2010 Ryan Schroeder City Manger City of Cottage Grove 7516 80 Street South Cottage Grove, MN 55016 SUBJECT:. Proposal for the relocation of one residential property at 6043 E. Point Douglas Road South, Cottage Grove, MN. Evergreen Land Services Co. (ELS) is pleased to present the following proposal to assist the City of Cottage Grove in the relocation of the property at 6043 E. Point Douglas Road South. ELS has been serving municipal and private clients with these types of projects for over 30 years. ELS is sufficiently staffed to handle this project and complete the relocation within the time frame necessary. All relocation services will be performed under the guidelines set by the Uniform Relocation Assistance and Real Property Acquisition Act of 1970 as amended. I'm submitting a bid for our services necessary to assist and relocate the four residential properties. This amount is based on the amount of time I feel our relocation staff would need to provide relocation services. Relocation The project objective will be to assist the impacted single - family residence, which is eligible for assistance under the federal guidelines in relocating to adequate replacement accommodations as quickly as possible. In addition, ELS can assure that this project will be operated in accordance with the "Uniform Act" to maximize federal participation. The one residential property owner will be treated in a just maimer and receive adequate compensation under the applicable guidelines. residence. ELS will operate a cost effective and efficient program and will address all the special needs of the ! to find workable all problems relocation related to the would needs of the city Cottage Grove and displacees involved. We anticipate the usual range of diffliculties and probably some new challenges. We have the capabilities to address all of these issues. it Mr. Schroeder August 11, 2010 Page 2 Relocation assistance services include the following: • Initial meeting with the Cottage Grove staff to discuss project coordination and procedures; meetings with the public and occupants to discuss and provide written general information on relocation benefits, documentation requirements, and the process applicable to each of their situations. • Determine needs and preferences for the move and replacement location for the owners and occupants. Explain relocation benefits, the process involved with relocation, and the payment documentation requirements. • Offer advisory services regarding the move, explanations of relocation benefits and procedures, and other assistance as necessary. • Preparing the required General Information Notice, Notices of Eligibility for Relocation Assistance, and 90 -day and 30 day Notices to Vacate per the relocation regulations, for the staff s review and signature. • Assisting the displaced occupants in identifying and documenting eligible, reimbursable relocation costs and confirming the submitted costs are reasonable and necessary per the regulations. Coordinate and secure competitive moving bids. • Conduct research for comparable properties, inspect comparable properties and provide referrals to available replacement properties, as requested. Once a property is found by displaced occupant conduct an inspection to make sure that it meets (DSS) Decent Safe and Sanitary requirements under the federal guidelines. • Preparing claims for relocation payment and making recommendations to the City of Cottage Grove regarding the eligibility of relocation benefits requested by the displaced occupants. • Throughout the project, addressing questions and concerns of the displaced occupants, and advising the occupants of their rights and obligations in the relocation process. • Throughout the project, reviewing the project /relocation status and reviewing any questions and concerns. • Document and close out file once all relocation benefits are given. Mr. Schroeder August 11, 2010 Page 3 This list of tasks is not all - inclusive but our activities will comply with Minnesota Statute and Uniform Act regulations and will include all steps required in the process and additional steps as may be helpful. All written and oral communication will be documented in each file and a bi- weekly status report will be updated and presented to the client. Normally relocation of a residential property takes between 35 and 45 hours. Evergreen Land Services estimates the cost for our relocation services to assist the City of Cottage Grove in the relocation of the one residential property to be approximated $3,000.00. If you have any questions, please give me a call at (651) 882 -0200. We look forward to working with the City of Cottage Grove. Sincerely, Steven Carlson Relocation Manager 1. PARTIES. This Purchase Agreement is made on this day of December 2010, by and between Cottage Grove Economic Development Authority, a body politic under the laws of Minnesota, 7516 80 Street South, Cottage Grove Minnesota 55016, ( "Seller ") and South Washington Watershed District, a body politic and corporate under the laws of Minnesota, 2302 Tower Drive Woodbury, Minnesota 55125, ( "Buyer "). 2. OFFER/ACCEPTANCE. Buyer offers to purchase and Seller agrees to sell real property legally described as follows, to -wit: Exhibit "A" which is attached hereto and made a part hereof by reference located in the City of Cottage Grove, County of Washington, State of Minnesota. 3. ACCEPTANCE DEADLINE. The acceptance date of this Agreement is the date it is delivered by the last party signing to the other party. This offer to purchase, unless accepted sooner shall be void at 11:59 P.M. on January 19, 2011, and in such event, all earnest money shall be refunded to Buyer. 4. PRICE AND TERMS. The price for the real and personal property included in the sale is Four Hundred Twenty Thousand and 00 /100ths Dollars ($420,000.00), plus reimbursement of amount paid by the Seller for a relocation consultant and relocation costs of the prior owner, which Buyer shall pay as follows: cash, on or before May 1, 2011, the DATE OF CLOSING. Closing shall be at the office of the City of Cottage Grove or other location agreed to by Seller and Buyer. 4.1 Contingency. This Agreement is subject to the following contingency: Issuance of bonds by the South Washington Watershed District on or before the closing date, in an amount sufficient to pay the purchase price. The Buyer shall promptly under take steps to issue bonds and shall do so with due diligence to have the bonds issued in a timely manner. In the event the bonds are not issued before May 1, 2011, the closing date shall be extended for sixty (60) days to allow the Buyer is issue the bonds. 5. DEED/MARKETABLE TITLE. Upon performance by Buyer, Seller shall execute and deliver a Warranty Deed, conveying marketable title, subject to: B. Restrictions relating to use or improvement of the property without effective forfeiture provisions; D. Utility and drainage easements which do not interfere with existing improvements; 6. REAL ESTATE TAXES AND SPECIAL ASSESSMENTS. Real estate taxes due and payable in and for the year of closing shall be prorated between Seller and Buyer on a calendar year basis to the actual date of closing. Seller represents that the taxes due and payable in the year(s) 2011 are FULL homestead classification SELLER SHALL PAY ON THE DATE OF CLOSING all installments of special assessments certified for payment with the real estate taxes due and payable in the year of closing. SELLER SHALL PAY ON THE DATE OF CLOSING all other special assessments levied as of the date of this agreement. As of the date of this Agreement, Seller represents that Seller has not received a Notice of Hearing of a new public improvement project from any governmental assessing authority, the costs of which project may be assessed against the property. If a special assessment becomes pending after the date of this agreement and before the date of closing, Buyer may, at Buyer's option: A. Assume payment of the pending special assessment without adjustment to the purchase agreement price of the property; or B. Require Seller to pay the pending special assessment (or escrow for payment of the same as provided above) and Buyer shall pay a commensurate increase in the purchase price of the property, which increase shall be the same as the estimated amount of the assessment; or C. Declare this Agreement void by notice to Seller, and earnest money shall be refunded to Buyer. SELLER SHALL PAY ON DATE OF CLOSING any deferred real estate taxes or special assessments payment of which is required as a result of the closing of this sale. BUYER SHALL PAY REAL ESTATE TAXES due and payable in the year following closing and thereafter any unpaid special assessments payable therewith and thereafter, the payment of which is not otherwise provided for herein. Seller makes no representation concerning the amount of future real estate taxes or of future special assessments. T CLOSING COSTS. The costs of closing, if not determined by other provisions of this Agreement, shall be paid as follows: Agreement, 1. Document preparation costs, recording fees, and deed taxes for documents necessary to establish good and marketable title in Seller. 2. Document preparation costs, certified copy fees, and recording fees to establish the authority of the person acting on behalf of Seller. 3. Document preparation costs for Seller's deed or contract-for-deed, Certificate of Real Estate Value, Seller's Affidavit, Well Disclosure Certificate (if required), and any other documents necessary to transfer good and marketable title by Seller's deed or contract-for-deed. 4. Deed tax on Seller's deed and the Agricultural Conservation deed tax charged under Minnesota Statutes Section 40A.152. 5. Fees payable to Seller's lawyer or to a closer ["title closer"] for conducting the title-transfer portion of the closing. . B. BUYER'S COSTS. Buyer shall pay the following at closing: Document preparation costs, recording fees, and mortgage registry taxes for documents necessary for buyer's mortgage financing. 2. Document filing fee for a Well Disclosure Certificate, if applicable. 3. The Agricultural Conservation deed tax on Buyer's mortgage deed charge under Minnesota Statutes Section 40A.152. 4. Recording fee for Deed, or other instrument of conveyance where Buyer is the grantee. 8. DAMAGES TO REAL PROPERTY. If the real property is substantially damaged prior to closing, this Agreement shall terminate and the earnest money shall be refunded to Buyer. If the real property is damaged materially but less than substantially prior to closing, Buyer may rescind this Agreement by notice to Seller within 21 days after Seller notifies Buyer of such damage, during which 21 -day period Buyer may inspect the real property, and in the event of such rescission, the earnest money shall be refunded to Buyer. I A. Seller knows of no hazardous substances or petroleum products having been placed, stored, or released from or on the property by any person in violation of any law, nor of any underground storage tanks having been located on the property at any time, except as follows: B. Seller's warranties and representations contained in this paragraph 10 shall survive the delivery of the Deed, provided that any notice of a defect or claim or breach of warranty must be in writing and any such notice with respect to matters referred to in A. above must be given by Buyer to Seller within one year of the date of closing or be deemed waived. C. Buyer shall have the right to have inspections of the property conducted prior to closing. Unless required by local ordinance or lending regulations, seller does not plan to have the property inspected. Other than the representations made in this paragraph 10, the property is being sold "AS IS" with no express or implied representation or warranties by seller as to physical conditions, quality of construction, workmanship, or fitness for any particular purpose. To the best of Seller's knowledge, no environmental inspections, tests or reports have been made or prepared in connection with the property. Seller's warranties and representations contained in this paragraph 9 shall survive the delivery of the deed, provided that any notice of a defect or claim of breach of warranty must be in writing and given by Buyer to Seller within one (1) year of the date of closing or be deemed waived. 11. DISCLOSURE OF NOTICES. Seller has not received any notice from any governmental authority as to violation of any law, ordinance or regulation affecting the property. If the property is subject to restrictive covenants, Seller has not received any notice from any person as to a breach of the covenants. 12. POSSESSION. Seller shall deliver possession of the property not later than closing. All interest, fuel oil, liquid petroleum gas, and all charges for city water, city sewer, electricity, and natural gas shall be prorated between the parties as of closing. M 13. EXAMINATION OF TITLE. Within a reasonable time after acceptance of this Agreement, Seller shall furnish Buyer with an Abstract of Title or a Registered Property Abstract certified to date including proper searches covering bankruptcies and State and Federal judgments, liens, and levied and pending special assessments. Buyer shall have ten (10) business days after receipt of the Abstract of Title or Registered Property Abstract either to have Buyer's attorney examine the title and provide Seller with written objections or, at Buyer's own expense, to make an application for a Title Insurance Policy and notify Seller of the application. Buyer shall have ten T(10) business days after receipt of the Commitment for Title Insurance to provide Seller with a copy of the Commitment and written objections. Buyer shall be deemed to have waived any title objection not made within the ten (10) day period, except that this shall not operate as a waiver of Seller's covenant to deliver a statutory Warranty Deed, unless a Warranty Deed is not specified above. 14. TITLE CORRECTIONS AND REMEDIES. Seller shall have 120 days from receipt of Buyer's written title objections to make title marketable. Upon receipt of Buyer's title objections, Seller shall, within ten (10) business days, notify Buyer of Seller's intention to make title marketable within the 120 day period. Liens or encumbrances for liquidated amounts which can be released by payment or escrow from proceeds of closing shall not delay the closing. Curer of the defects by Seller shall be reasonable, diligent, and prompt. Pending correction of title, all payments required herein and the closing shall be postponed. A. If notice is given and Seller snakes title marketable, then upon presentation to Buyer and proposed lender of documentation establishing that title has been marketable, and if not objected in the same time and manner as the original title objections, the closing shall take place within ten (10) business days or on the scheduled closing date, whichever is later. B. If notice is given and Seller proceeds in good faith to make title marketable but the 120 day period expires without title being made marketable, Buyer may declare this Agreement void by notice to Seller, neither party shall be liable for damages hereunder to the other, and earnest money shall be refunded to Buyer. C. If Seller does not give notice of intention to make title marketable, or if notice is given but the 120 day period expires without title being made marketable due to Seller's failure to proceed in good faith, Buyer may seek, as permitted by law, one or more of the following: 0 2. Rescission of this Purchase Agreement by notice as provided herein, in which case the Purchase Agreement shall be void and all earnest money paid hereunder shall be refunded to Buyer. Specific performance within six months after such right of action arises. D. If title is marketable, or is made marketable as provided herein, and Buyer defaults in any of the agreements herein, Seller may elect either of the following options, as permitted by law: Cancel this contract as provided by statute and retain all payments made hereunder as liquidated damages. The parties acknowledge their intention that any note give pursuant to this contract is a down payment note, and may be presented for payment notwithstanding cancellation; 2. Seek specific perfonnance of this Agreement within six months after such right of action arises, including costs and reasonable attorneys' fees, as permitted by law. E. If title is marketable, or is made marketable as provided herein, and Seller defaults in any of the agreements herein, Buyer may, as permitted by law: Seek specific performance within six months after such right of action arises. 15. NOTICES. Any notice, demand, request or other communication which may or shall be given or served by the parties shall be deemed to have been given or served on the date the same is deposited in the United States Mail, registered or certified, postage prepaid and addressed as follows: If to Seller: Cottage Grove Economic Development Authority 7516 80' St. So. Cottage Grove, MN 55016 ATTN: Ryan Schroeder With copy to: Kennedy & Graven, Chartered 470 U S. Bank Building 200 South Sixth St. Minneapolis, MN 55402 1 If to Buyer: South Washington Watershed District 2302 Tower Drive Woodbury, Minnesota 55125 ATTN: Matt Moore With coy to : Jack W. Clinton, P.A. Suite 200 Tamarack Hills 539 Bielenberg Drive Woodbury Minnesota 55125 16. SUBDIVISION OF LAND. If this sale constitutes or requires a subdivision of land owned by Seller, Seller shall pay all subdivision expenses and obtain all necessary governmental approvals. Seller warrants that the legal description of the real property to be conveyed has been or will be approved for recording as of the date of closing. 17. MINNESOTA LAW. This contract shall be governed by the laws of the State of Minnesota. 18. WELL DISCLOSURE. Wells on the subject real property are disclosed by Seller on the attached Well Disclosure form. 19. INDIVIDUAL SEWAGE TREATMENT SYSTEM DISCLOSURE. Individual sewage treatment systems on or serving the property are disclosed by Seller on the attached disclosure statement. 20. LEAD PAINT DISCLOSURE. Buyer waives disclosure concerning any lead paint. 21. SELLER'S AFFIDAVIT. At closing, Seller shall supplement the warranties and representations in this Purchase Agreement by executing and delivering a Minnesota Uniform Conveyance Blank [fornz No. 116 -M, 117 -M, or 118 -M] Affidavit of Seller. 22.1 Except for the warranties in this agreement, the property is sold "AS IS ". 22.3 Seller has granted the prior owner the right to occupy the property until March 1, 2011, unless 60 days notice is given to vacate. Buyer and Seller shall co-operate to concerning the prior owner's occupancy and termination of the same prior to the closing. 23 22.4 Seller and Buyer waive the inspection requirements of Minn. Stat. 513.52 - 513.60. 22.5 The Seller and the Buyer represent and warrant to each other that they have not dealt with any brokers in connection with the transaction contemplated by this Agreement. Each party agrees to indemnify, defend and hold each other harmless from the claims of any broker or real estate agent. 22.6 Buyer shall be responsible for any costs to seal the well on the property and to close the septic system. ADDENDA. Attached are two (2) addenda which are made a part of this Agreement. 1. Well Disclosure form; and 2. Individual sewage treatment systems Disclosure IN WITNESS WHEREOF, the parties have executed this Purchase Agreement the date and year indicated above. I agree to sell the property for the price and terms and conditions set forth above By: Its: President I Executive Director I agree to purchase the property for the price and terms and conditions set forth above. SELLER: SOUTH WASHINGTON WATERSHED DISTRICT By: jack Lavold Its: President By: Donald Pereira Its: Secretary I