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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 �r 2' 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 a J t0 N 0 Z rn 01 ? O N O • r; n --i > CD X1 o n a C �^ 3 ti A Co `'' m -m-I. rte.. v ° D v 'S r Z A r r ✓ t (a O A O ▪ Y 0 o A n ID m O N m ' M r m m r O v. b.% _. M v 3 ._. m z 3 . O D n m .... -4 m ¢ . m 0 m m z .1 ( A O ▪ • 17 ▪ 2 " ▪ " 0 �l�p m 4.4 O Z A m 'S `T J' ro 3 Z N 2 N N Z fZ N Z. b - O O O -1 ▪ 0 V Q CA .--• y `o. m d CO o o 01 c, A 6-•1 A Z 3 m Nyv STATE 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 SOUTH CAROLINA SOUTH DAKOTA TENNESSEE 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. !TOMC OL s�: lit ill *- lilt , .. :tit at i 3 at I am ' gilt tat l • ..„ _..,a• mall esti 1 • t mu i II!! alt lb. asi m altf sill i El a alt l . an. Po* = 00 al 1 - - 5 , MI - nu II Mil ° Mil Ili null In) Me 1 - r. ruN tit Mil Olt/ In NI nut su mg , t - t . . 4111t9.2,11 , lam/ gair as 'war la _.‘• am. 2...w p ab, 1 sub as ell • 11111 is' till • ... •iii, sii_rii000.0... :La re,if Ac a t. ,,5 . ti'. ti Mill all a alt 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