CR 96-157 Approve Purchase Agreement - 130 19th Ave S•
September 25, 1996
Proposed Action.
Staff recommends adoption of the following motion: Move that Council adopt Resolution 96 -80,
Resolution approving purchase of property at 130 19'" Avenue South.
Overview.
APPROVE PURCHASE AGREEMENT
130 19 AVENUE SOUTH - GRANDNER PROPERTY
Council previously authorized construction of cul -de -sacs at the intersections of 18" and 19'"
Avenues South and County State Aid Highway (CSAH) 3. Further, Council approved moving
the house at 130 19`" Avenue South to provide for proper setbacks from the cul -de -sac. Staff
reported at the July 9 Council worksession that the house moving costs were nearly the same as
purchasing the home, demolishing the 50+ year old home and reselling the property on the open
market. Staff reported an estimated purchase and relocation cost of $85,000 (see attached
worksession report). Council was not opposed to purchase but requested that staff get a firm
cost for purchase and relocation prior to further action. Staff hired Wilson Development
Services, a relocation consultant, and has negotiated a purchase agreement with the property
owners, Mr. and Mrs. Grandner.
Primary Issues to Consider,
o What are the purchase and relocation costs?
o Are the terms and conditions of the purchase and relocation agreeable to the Grandners?
o Purchase/relocation Funding
o Schedule
Supporting Information
o Analysis of Issues
o Proposed Purchase Agreement
o Wilson Development letter, Sept 17, 1996
o Council Worksession emo dated July 5, 1996
o Resolution 96 -80
cr Inv
Steven J. Stadler, Public Works Director
Council Report 96-157
Analysis of Issues
o What are the purchase and relocation costs?
The total purchase and relocation costs are $87,634.00 This includes relocation costs of
$3,484.00 to Mr. and Mrs. Grandners' son Gary who has resided at 130 19 Avenue
South for several years.
Are the terms and conditions of the purchase and relocation agreeable to the Grandners?
Wilson Development Services followed procedures required by law to protect property
owners and renters facing government relocation. The Grandners agreed to the purchase
amount based on the closest match of three comparable homes currently being sold in the
area. A slight upward adjustment was made to compensate the Grandners for central air
conditioning. The purchase agreement calls for a dosing date on or before October 31,
1996. This date was requested by the Grandners who intend to move to an apartment in
the area within 45 - 60 days of closing. The agreement allows the Grandners to lease the
home from the City for $478.00 per month.
o Purchase/relocation Funding
Funding will be included as part of a General Obligation Tax Increment Bond to fund the
first phase of CSAH 3 Improvements. Staff is working up the final amounts necessary on
this proposed $1.6 - 2.0 million bond issue and will request approval for the bond issue at
the November 5 Council Meeting.
o Schedule
If purchase is approved, house demolition would occur shortly after the Grandners move
out. The property would be advertised for sale as soon as possible but not later than next
spring.
•
WILSON
4t V4 UC10.:a
Rvir
WILSON DEVELOPMENT SERVICES
"HELPING CITIES AND BUSINESSES GROW"
September 18, 1996
Steve,
Here is the signed purchase agreement and lease agreement for the Grandners.
Jerre Miller reviewed them prior to the Grandner's signature.
Please have the City sign both agreements and issue a $100.00 earnest money check, made
payable to the Grandners.
Also enclosed is the advance claim form on Gary's rental assistance, to secure a rental unit
he has found to move to. The landlord is holding it, but will need the deposit and rent as
soon as possible.
510 Chestnut Si, Suite 200, Chaska, MN 55318
Office: (612) 448 -4630 FAX: (612) 445 -4676
•
•
Date:
PURCHASE AGREEMENT
RECEIVED OF City of H Akins, the sum of $100 DOLLARS ($100) by check, to be deposited
upon acceptance of Purchase Agreement. Said earnest money is part payment for the purchase of
property located at: 130 19` Avenue South, Hopkins, State of Minnesota.
Legally described as: -
P10 SE / of SE Yee of Sec. 23 Twp 117; Range 22, PID = 23- 117 -22- 440010
Hennepin County
Including the following property, if any, owned by Seller and used and located on said property: all
garden bulbs, shrubs, and trees, all storm sash, storm doors, detachable vestibules, screens,
awnings, window shades, blinds (including venetian blinds), curtain rods, traverse rods, drapery
rods, lighting fixtures and bulbs, plumbing fixtures, hot water tanks and heating plant (with any
burners, tanks, stokers and other equipment used in connection therewith), water softener and
liquid gas tank. BUILT -INS• dishwasher, garbage disposal, ovens, cook top stoves, ceiling fans,
garage door opener and all controls; if any (see Exhibit #1 attached hereto),
all of which property the undersigned has this day sold to the Buyers for the sum of: Eighty -three
thousand ($83,000) Dollars, which the buyer agrees to pay in the following manner:
Earnest money herein paid ($100) and 582.900 cash, on or before October 31. 1996, the date of
closing.
This purchase price includes any and all relocation benefits that are eligible under the Uniform
Real Property Acquisition and Relocation Act of 1970, (49CFR Parts 24) as amended, and
Minnesota Statutes 117.52. Except as follows:
1. Incidental Closing Expenses. The seller has one year from the date of displacement to purchase
a replacement dwelling for which eligible incidental costs will be reimbursed to the Seller by the
Buyer.
2. Moving Expenses. The Buyer will reimburse the Seller for actual moving costs or a self -move
of the Seller's personal property per applicable relocations.
The Se,,ller acknowledges that they met with the Buyer's relocation consultant on
, 1996, at which time the Sellers rights and benefits, under the
Uif tour elocation Act and Minnesota Statutes 117.52 re explained to them. The Seller further
,
acknowledges that the negotiated purchase price of $ � 0-.10 , includes
compensation for the acquisition of the subject property and relocation benefits under the Uniform
Relocation Act.
• This Purchase Agreement is not contingent upon the sale of another property.
•
•
DEED /MARKETABLE TITLE: Subject to performance by the Buyer, the Seller agrees to
execute and deliver a Warranty Deed conveying marketable title to said premised subject only to
the following exceptions:
(a) Building and zoning laws, ordinances, State and Federal regulations
(b) Restrictions relating to use or improvement of premises without effective forfeiture
provision.
(c) Reservation of any minerals or mineral rights to the State of Minnesota.
(d) Utility and drainage easements which do not interfere with present improvements.
(e) Rights of tenants as follows: (unless specified, not subject to tenancies)
REAL ESTATE TAXES: Real estate taxes due and payable in and for the year of closing shall
be prorated between Seller and Buyer on a calendar basis to the actual date of closing.
POSSESSION: The Seller further agrees to deliver possession not later than (See Exhibit #2)
after closing provided that all conditions of this agreement have been complied with. All charges
for city water, city sewer, electricity, and natural gas shall be prorated between the parties as of
date of possession. Buyer agrees to remove ALL DEBRIS AND ALL PERSONAL PROPERTY
NOT INCLUDED HEREIN from the property by possession date as per attached Exhibit #1. The
Buyer agrees to lease the premises to the Sellers from day of closing pursuant to the Lease
Agreement attached hereto as Exhibit #2.
TITLE: The Seller shall, within a reasonable time after approval of this agreement, furnish an
abstract of title, or a Registered Property Abstract certified to date to include proper searches .
covering bankruptcies, and State and Federal judgments and liens. The Buyer shall be allowed 20
days after receipt thereof for examination of said title and the making of any objections thereto,
said objections to be made in writing or deemed to be waived. If any objections are so made the
Seller shall be allowed 60 days to make such title marketable Pending correction of title the
payments hereunder required shall be postponed, but upon correction of title and within 10 days
after written notice to the Buyer, the parties shall perform this agreement according to its terms.
SPECIAL ASSESSMENTS: Seller shall pay on date of closing all installments of special
assessments. Seller shall pay on date of closing all other special assessments levied as of the date
of closing. Seller shall provide for payment of all special assessments pending as of the date of
closing for improvements that have been ordered by the city or other assessing authorities. Seller
shall pay on the date of closing, any deferred taxes.
SELLER WARRANTIES: SELLER WARRANTS THAT BUILDINGS, ARE OR WILL
BE, CONSTRUCTED ENTIRELY WITHIN THE BOUNDARY LINES OF THE
PROPERTY. SELLER WARRANTS THAT THERE IS A RIGHT OF ACCESS TO THE
PROPERTY FROM A PUBLIC RIGHT OF WAY. THESE WARRANTIES SHALL
SURVIVE THE DELIVERY OF THE DEED OR CONTRACT FOR DEED.
•
RISK OF LOSS: If There is any loss or damage to the property between the date hereof and the
date of closing, for any reason including fire, vandalism, flood, earthquake, or act of God, the risk
of loss shall be on Seller. If property is destroyed or substantially damaged before the closing date,
this Purchase Agreement shall become null and void, at Buyer's option, and earnest money shall be
refunded to Buyer; Buyer and Seller agree to sign cancellation of Purchase Agreement.
TIME OF ESSENCE: Time is of the essence in this Purchase Agreement.
ENTIRE AGREEMENT: This Purchase Agreement, any attached exhibits and any addenda or
amendments signed by the parties, shall constitute the entire agreement between Seller and Buyer,
and supersedes any other written or oral agreements between Seller and Buyer. This Purchase
Agreement can be modified only in writing signed by Seller and Buyer.
If said title is not marketable and it not made so within 60 days from the date of written objections
thereto as above provided, this agreement shall be null and void, at option of the Buyer, and neither
principal shall be liable for damages hereunder to the other principal. All money theretofore paid
by the Buyer shall be refunded.
DEFAULT: If the title to said property shall be found marketable or be so made within said time,
and said Buyer shall default in any of the agreements and continue in default for a period of 10
days, then and in that case the Seller may terminate this contract and on such termination all the
payments made upon this contract shall be retained by said Seller, as liquidated damages, time
being of the essence hereof. This provision shall not deprive either party of the right of enforcing
the specific performance of this contract provided such contract shall not be terminated as
aforesaid, and provided action to enforce such specific performance shall be commenced within six
months after such right of action shall arise.
Seller warrants that the property is directly connected to City Sewer and City Water. Seller
warrants that all appliances, heating, air conditioning, wiring and plumbing systems used and
located on said property will be in working order on the date of closing. Buyer has the right to
inspect the property prior to closing.
The undersigned, owner of the above land, does hereby approve the above agreement and the sale
thereby made.
SELLER:
4 ka3-a e 2 fl .. -/? 96
Kenneth Grandner (date)
J� �J,a ?,// z/F '
Marian Grandner (date)
I hereby agree to purchase the said property for the price and upon the terms above mentioned, and
subject to all conditions herein expressed.
•
•
BUYERS:
By:
Its:
1
•
EXIIIBIT # 1
SALVAGE BY SELLER AT NO COST
*Central Air Unit
*Water Softener
*Medicine Cabinet in Main -Floor Bathroom
*Kitchen Cabinets
*Refrigerator
*Dishwasher
*Washer/Dryer
1
•
•
EXHIBIT # 2
RESIDENTAL PROPERTY LEASE
The State of Minnesota, County of HENNEPIN
This lease is made between City of Hopkins, (hereinafter Lessor), and Kenneth &
Marian Grandner , (hereinafter Lessee).
Lessor hereby leases to Lessee and Lessee hereby hires the space presently known
as: 130 19'" Avenue South, Hopkins, MN
The residence is leased for a term to commence on October 31, 1996, and to
continue until March 1, 1997.
The Lessee agrees to pay as rent on the first day of each month $478.00 per
month. The Lessee also agrees to pay all utility bills, maintenance, service and repair bills
for the premises. If Lessee vacates premises prior to end of lease, Lessor will reimburse
Lessee amount of $15.42 per day of prepaid rent, if any.
Lessee shall use and occupy the premises as a residence, with all possessory rights.
Lessor represents that the premises may be lawfully used for such purpose.
I:essee shall commit no act of waste and shall take good care of the premises and
the fixtures and appurtenances therein, and shall, in the use and occupancy of the
premises, conform to all laws. All improvements made by Lessee to the premises which
are so attached to the premises that they cannot be removed without material injury to the
premises, shall become the property of Lessor upon installation.
Not later than the last day of the term Lessee shall, at Lessee's expense, remove all
of Lessee's personal property and those improvement made be Lessee which have not
become the property of the Lessor; surrender the premises in as good condition as they
were at the beginning of the term, reasonable wear and damage by fire, the elements,
casualty, or other cause not due to the misuse or neglect by Lessee or Lessee's agents,
servants, visitors, servants or licensees, excepted.
Lessee shall not, without first obtaining the written consent of the Lessor, make
any alterations, additions or improvements in, to or about the premises.
Lessee is responsible to insure all personal property and contents in said premises,
in case of loss or damage.
Lessee shall not, without obtaining the written consent of the Lessor, assign,
mortgage, pledge, or encumber this lease, in whole or in part, or sublet the premises or
any part of the premises.
If the premises or any part of the premises, or any part of the building materially
affecting Lessee's use of the premises, be taken by eminent domain, this lease shall
terminate on the date when title vest pursuant to such taking. The rent shall be
apportioned as of the termination date and any rent paid for any period beyond such date
shall be repaid of Lessee.
This lease shall be subject and subordinate to all underlying leases and to mortgage
which may now or hereafter affect such leases or the real property of which the premises
form a part, and also all renewals, modifications, consolidations, and replacements of the
underlying leases and mortgages. Lessee agrees to execute such estoppel letters or other
documents required to confine the same.
Lessor shall make all necessary repairs to the premises, except where the repair has
been made necessary by misuse or neglect by Lessee or Lessee's agents, servants, visitors,
or licensor.
Dated:
Residential Property Lease
Lessor:
Lessee:
BY:
ITS:
' atieb.„:— ..Weidecit P iny
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WILSON DEVELOPMENT SERVICES
"HELPING CITIES AND BUSINESSES GROW"
September 17, 1996
Steve Stadler
Public Works Director
City of Hopkins
1010 1' St.
Hopkins, MN 55343
RE: Grandner Relocation
FOR: 130 -19 Ave. South
Dear Mr. Stadler;
Enclosed are the acquisition- relocation and moving estimates for Marian and Kenneth Grandner
and Gary Grandner on 19 Ave. South.
The agreed purchase price, including relocation differential amount is $83,000. If the Grandners
choose to do a fixed move, the City would be responsible for $1,150, based on 9 rooms. If they
choose to do an actual cost move, it will be based on the lower of two moving estimates.
Gary Grandner is also eligible as a displaced person. Based on the difference of his imputed
economic rent and comparable, he is eligible for $3,234, for rental assistance and $250 for a fixed
move. (1 room)
*Amount subject to change if Grandner's decide to choose the actual cost move.
(lower of 2 estimates)
Please call if you have questions. 448 -4630
Sincerel
Ka
Re
eg
Consultant
Acquisition and Relocation
Rental Assistance (Gary)
Fixed move for 9 rooms (Grandness)
Gary's fixed move
Total
$83,000.00
$ 3,234.00
$ 1,150.00*
$ 250.00
$87,634.00
510 Chestnut St., Suite 200, Chaska, MN 55318
Office: (612) 448 -4630 FAX: (612) 448 -4676
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ALABAMA
ALASKA
ARIZONA
ARKANSAS
CALIFORNIA
COLORADO
CONNECTICUT
DELAWARE
D. C.
FLORIDA
GEORGIA
HAWAII
IDAHO
ILLINOIS
INDIANA
IOWA
KANSAS
KENTUCKY
LOUISIANA
MAINE
MARYLAND
MASSACHUSETTS
MICHIGAN
MINNESOTA
MISSISSIPPI
MISSOURI
MONTANA
NEBRASKA
NEVADA
NEW HAMPSHIRE
NEW JERSEY
NEW MEXICO
NEW YORK
NORTH CAROLINA
NORTH DAKOTA
OHIO
OKLAHOMA
OREGON
PENNSYLVANIA
PUERTO RICO
RHODE ISLAND
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TEXAS
UTAH
VERMONT
VIRGIN ISLANDS
VIRGINIA
WASHINGTON
WEST VIRGINIA
WISCONSIN
WYOMING
RESIDENTIAL MOVING EXPENSE AND DISLOCATION ALLOWANCE SCHEDULE
UNDER 49 CFR PART 24
NUMBER OF ROOMS OF FURNITURE
EACH
ADD,
1 1 2
250
350
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
//250)
x `"750
250
250
250
250
250
250
250
253_
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
250
OCCUPANT OWNS FURNITURE
3 1 4 1 5 1 6 7 1
350 450 550 625 700 775
500 650 800 925 1050 1175
400 550 650 750 850 950
350 450 550 625 700 775
400 550 650 750 850 950
400 550 650 750 850 950
400 550 650 750 850 950
350 450 550 625 700 775
400 550 650 750 850 950
350 450 550 625. 700 775
350 450 550 625 700 775
400 550 650 750 850 950
350 450 550 625 700 775
400 550 650 750 850 950
400 550 650 750 850 950
350 450 550 625 700 775
350 450 550 625 700 775
400 550 650 750 850 950
350 450 550 625 700 775
350 450 550 625 700 775
400 550 650. 750 850 950
400 550 650 750 850. 950
400 550. 650 750 850 950
400 550 650 750 850 950
350 450 550 625 700 775
350 450 550 625 700 775
350 450 550 625 700 775
350 450 550 625 700 775
400 550 6 750 850 950
350 450 550 625 700 775
400 550 650 750 850 950
400 550 650 750 850 950
400 550 650 ..750 850 950
350 450 550 625 700 775
350 450 550 625 700 775
400 550 650 750 850 950
350 450 550 625 700 775
400 550 650. 750 850 950
400 550 650 750 850 950
350 450 550 625 700 775
350 450 550 625 700 775
350 450 550 625 700 775
350 450 550 625 700 775
350 450 550 625 700 775
350 450 550 625 700 775
350 450 550 625 700 775
350 450 550 625 700 775
350 450 550 625 700. 775
400 550 650 750 850 950
400 550 650 750 850 950
400 550 650 750 850 950
400 550 650 750 850 950
350 450 550 625 700 775
FIRST EACH ADD.
8 ROOM ROOM ROOM
850
1300
1050
850
1050
1050
1050
850
1050
850
850
1050
850
1050
1050
850
850
1050
850
850
1050 100
1050 ppp ,,, / ,,, ... yyy ,,,,,, 100
(1as 0_ � D
05 100
850 75
850
850
850
1050
850
1050
1050
1050
850
850
1050
850
1050
1050
850
850
850
850
850
850
850
850
850
1050
1050
1050
1050
850
75
100
100
75
100
100
100
75
100
75
75
100
75
100
100
75
75
100
75
75
75
75
75
100
75
100
100
100
75
75
100
75
100
100
75
75
75
75
75
75
75
75
75
100
100
100
100
75
EFFECTIVE FOR HUD- ASSISTED PROGRAMS: 4/2/89
ATTACHMENT
OCCUPANT DOES NOT
OWN FURNITURE
200
225
225
200
225
225
225
200
225
200
200
225
200
225
225
200
200
225
200
200
225
225
225
225
200
200
200
200
225
200
225
225
225
200
200
225
200
225
225
200
200
200
200
200
200
200
200
200
225
225
225
225
200
25
35
35
25
35
35
35
25
35
25
25
35
25
35
35
25
25
35
25
25
35
35
35
35
25
25
25
25
35
25
35
35
35
25
25
35
25
35
35
25
25
25
25
25
25
25
25
25
35
35
35
35
25
DATE: July 5, 1996
TO: Honorable Mayor and City Council
FROM: Steven J. Stadler, Director of Public Works
SUBJECT: Cul -de -sac on 19 Avenue at County Road 3 and Disposition of
Property at 130 19t Avenue South
Council had previously given approval to include moving the house at 130
19 Ave South as a part of the Phase I County Road 3 reconstruction project.
Relocation was necessary to accommodate construction of a new cul -de -sac.
The estimated house relocation cost was $35,000. Staff has now determined
that this contractor estimate was low. Staff believes that the actual cost to
move the home and make required building code modifications is $60- 70,000.
This revised estimate is based on the attached scope of work and Parkos
Construction Company, Inc. proposal of' $82,650. By paring down the scope
of work slightly and competitively bidding the project, costs should drop to
the $60,000 - $70,000 range. These costs do not include the expense of
temporarily relocating the homeowners or moving and temporary storage of
their household goods. In light of this new cost information, a fresh look at
the cost effectiveness of moving the home is warranted. The option of
purchasing the property, demolishing the home and reselling the property for
redevelopment with a new single family dwelling must now be considered.
This option is very near in cost to the costs of moving the existing house
Furth • ack on the property. The 1996 assessed market value of the property
The land is valued at $22,000 and the improvements at $56,700.
Acco r. gly, a City offer of $85,000 for purchase and relocation costs would
be reasonable. (This will be confirmed with a relocation consultant prior to
the worksession.) The City could reasonably expect to receive $20,000 for
sale of the land. The estimated cost to demolish the existing house and
garage is $5,000 - $10,000. (Demolition could possibly be done in -house in
DEPARTMENT OF PUBLIC WORKS
MEMORANDUM
the November/December time frame) Therefore, the total City cost, after
resale of the land, is $70,000 - $75,000. This is just slightly more than we'd,
expect to pay with the moving the house option. Further, we'd replace a 50
year old house with a new one. Mother very important factor is that the
property owners, Mr. and Mrs. Kenneth Grandner, are interested in selling
their property.
An original and revised cost estimate breakdown are shown below:
Moving the house
Item Original Costs Revised Costs
House relocation: $35,000 $65,000
Temporary relocation+ $5,000 $5,000
City share of cul -de -sac
construction: $7,750 $7,750
TOTAL:
$47,750 $77,750
Purchasing the property
Item: Estimated cost
Purchase and relocation
allowance: $85,000
House demolition: $7,500
City share of cul -de -sac
construction: $7,750
Resale of property: ($20,000)
TOTAL: $80,250
In either case the cost of the cul -de -sac is considerably more than originally
reported to Council. Another option is to simply close off the end of 19
Avenue with signage and/or guard rail. This would accomplish the objective
of separating County Road 3 from the neighborhood. However, the street is
relatively narrow at 26' and most assuredly many motorists would be forced
to turn around in the Grandner's driveway. Additionally, Public Works
maintenance vehicles would be required to also turn around in the driveway
or back the 500+ feet to 1s` Street South. Currently, the County will pay an
estimated $8,750 towards construction of a cul-de -sac on 19 Avenue. This
money, of course, would be lost if the cul -de -sac wasn't constructed.
County Road 3 reconstruction and cul-de -sac construction will likely occur in
June - August, 1997. If the City were to purchase the property, it would be
preferable to clear the lot prior to cul -de -sac construction.
Staff would like to discuss this issue, answer questions, and receive direction
on how to proceed.
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Attest:
CITY OF HOPKINS
Hennepin County, Minnesota
RESOLUTION NO. 96-80
RESOLUTION APPROVING PURCHASE OF PROPERTY AT
130 19TH AVENUE SOUTH AND ASSOCIATED RELOCATION PAYMENTS
WHEREAS, the City Council authorized construction of a cul -de -sac on 19th Avenue South
at the intersection of CSAH 3, and
WHEREAS, cul -de -sac construction requires purchase of property at 130 19th Avenue
South, and
WHEREAS, staff has presented a signed purchase agreement and property lease to Council
for approval,
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Hopkins,
Mnmesota:
1. That purchase of the property at 130 19th Avenue South in the amount of
$83,000 is approved and the Mayor and City Manager are hereby authorized
and directed to execute the purchase agreement and property lease for and on
behalf of the city.
Adopted by the City Council of the City of Hopkins, Minnesota, this 1st day of October 1996.
James A Genellie, City Clerk
That total purchase and relocation costs in the amount of $87,634 are hereby
approved.
Charles D. Redepenning, Mayor