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<br />CASE # <br /> <br />/-.., <br /> <br />APPROVE PURCHASE AGREEMENT AND LOAN AGREEMENT FOR THE <br />PURCHASE OF PROPERTY LOCATED IN THE HIGHWAY 10 CORRIDOR <br />By: William K. Goodrich, City Attorney <br /> <br />Background: <br /> <br />As the Council is aware, the City has been negotiating with Lora G. Hamilton and Edward <br />Hamilton and Winslow 1. Holasek and Corinne M. Holasek for the purchase of their parcel of land <br />lying within the Highway 10 corridor Official Map area. The parcel. is located at 6205 and 6165 <br />Highway 10 NW and is approximately 1.11 acres in size. The property is occupied by a single <br />family residence which is occupied by a tenant on a month to month basis rental agreement with the <br />HamiltonslHolaseks. The funds for the purchase are from a Metropolitan Council Revolving <br />Acquisition Loan Fund (RALF) program. The loan proceeds will be reimbursed to the Metropolitan <br />Council by MnDOT when MnDOT has need for the parcel. Jodi Ruehle of The Tinklenberg Group' <br />has negotiated the purchase agreement on behalf of the City. The negotiated amount and appraised <br />value is $480,000.00 or approximately $9.92/sq. ft. In addition, as additional compensation to the <br />parcel owners, the Metropolitan Council has approved and Administrative Settlement of <br />$15,000.00. <br /> <br />A Loan Agreement between the Metropolitan Council and the City must also be entered into. Staff <br />will review the terms and conditions of the Loan Agreement with the Council at the Council <br />meeting. While the actual appraised value plus the Administrative Settlement is $495,000.00, the <br />total loan from the Metropolitan Council will be in excess of that amount in order to reimburse the <br />City. for its administrative expenses incurred in acquiring the parcel. The Metropolitan Council's <br />attorneys will review the Loan Agreement for fmal approval. <br /> <br />It should be noted that the tenant in the residence is entitled to relocation expenses which could be <br />in the $18,000.00 range. The City is responsible for relocation expenses for a 42 month period. <br />The tenant is paying a low monthly rent and therefore the cost of finding comparable <br />accommodations is relatively high. The City will need to front this money pending reimbursement <br />by MnDOT when funds are available in MnDOT's budget. Staff does not have a prediction of <br />when these funds will be paid back. <br /> <br />Funding Source: <br /> <br />RALF Fund for costs pertaining to the purchase and demolition. The City General fund regarding <br />the relocation expenses. <br /> <br /> <br />Enclosure: <br />Proposed Purchase Agreement <br />Metropolitan Council Loan Agreement <br />Map showing the parcel location <br /> <br />-341- <br />