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c4 1 954`14 ceememax <br />515 Little Canada Road, Little Canada, MN 55117 -1600 <br />(612) 484 -2177 / FAX: (612) 484 -4538 <br />MEMORANDUM <br />TO: Mayor Fahey & Members of the City Council <br />FROM: Joel Hanson, City Administrator <br />DATE: September 8, 1995 <br />MAYOR <br />Michael I. Fahey <br />COUNCIL <br />Beverly Scalze <br />Jim LaValle <br />Steve Morelan <br />Bob Pedersen <br />ADMINISTRATOR <br />Joel R. Hanson <br />RE: Resolution Establishing Trust /Escrow Account for Fire <br />Explosion Loss Proceeds <br />Council Member Morelan pointed out a new law passed this past <br />legislative session which authorizes municipalities to elect a <br />procedure to ensure that insured real property which has been <br />damaged or destroyed by fire explosion would be repaired or <br />removed by establishing a trust or escrow account for a portion <br />of the insurance settlement. This amount is determined to be the <br />lesser of 15% of the actual cash value of the property at the <br />time of loss or 15% of the settlement. <br />To participate in this program, the City must pass a resolution <br />that indicates its election to participate pursuant to Chapter <br />170 of Minnesota Statutes. This resolution is forwarded to the <br />Department of Commerce for future administration. By electing to <br />participate, we are indicating that the trust account will be <br />established and uniformally applied consistent with the law with <br />respect to all properties within our jurisdiction. <br />This appears to be a good option to help ensure minimal use of <br />City dollars to correct problems associated with damaged or <br />destroyed properties. One does not need to look too far into the <br />past to know that the City has expended monies to resolve these <br />types of issues. Therefore, I would recommend adoption of the <br />resolution as presented. <br />JRH:kpv <br />Enclosure <br />PAGE 122 <br />