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Litt1e uanada 515 Little Canada Road, Little Canada, MN 55117-1600 (651) 766-4029 / FAX: (651) 766-4048 www.ci.little-canada.mn.us MEMORANDUM TO: Mayor Keis & Members of the City Council FROM: Joel Hanson, City Administrator DATE: October 9, 2015 RE: Revised Development Agreement — 2955 & 2957 Arcade Street — Roger Berres MAYOR John Keis COUNCIL Rick Montour Michael McGraw Tom Fischer Christian Torkelson ADMINISTRATOR Joel R. Hanson Staff met with Mr. Berres to see if we could resolve the concerns he expressed at the Council Meeting of August 26th. Based on that discussion the attached development agreement was prepared. The changes from the earlier draft are noted in red with the major modifications as follows: • The initial work scope prepared by Housing Resource Center is being termed "preliminary". Upon execution of this agreement, staff and Mr. Berres will meet with HRC to prepare a final work scope to govern the project. • The City will pay 50% of the cost of the HRC contract (estimated at $3,175). Paying this amount meets the public purpose test by avoid legal expenses should Mr. Berres sue the City over not being able to rent the property or if the City sues Mr. Berres for illegal rental or construction activity. Plus, we improve the property to ensure it is not a blighting influence on the neighborhood given past comments by neighbors. We are also eliminating potential safety and health issues associated with the property given past code enforcement actions. Finally, we should also be minimizing staff time associated in . resolving this issue. Taking this action is non -precedent given the unique circumstances of this situation. • Mr. Berres will not be allowed to interfere with contractors on the job or retain his own contractors without the coordinating with HRC. Interference by Owner will be grounds for cancelling the agreement and loss of two-family home status. • An escrow deposit will be made based on the format presented in Exhibit D. Numbers will be revised based on the approved work scope. • Two family home status will not be granted until the completion of the rehab work and Mr. Berres must obtain a rental license for the one unit after completion but before rental. Staff is attempting to conduct a final review of this document with Mr. Berres prior to Wednesday's meeting. Ideally, he will have executed a copy of this document by that time. The City Attorney has also reviewed the revised document and approved it as to form. As a result, staff recommends approval of the revised development agreement as proposed. cc: Roger Berres