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City of Mounds View Housing Replacement Program S4. Development Agreement: The applicant must enter into a Demolition and Redevelopment Agreement with the EDA which will stipulate housing design and site development features consistent with the guidelines attached in Exhibit A (Housing Design and Site Criteria) and identify the time frame for completion. The development agreement will include an estimate of the minimum value of the home to be constructed. 5. Demolition Contract: The applicant must obtain three estimates for demolition from qualified demolition contractors which will assist in determining the amount of demolition funds to award for the project. The total amount of assistance provided shall not exceed the lowest responsible estimate received not to exceed $10,000. The selected demolition contractor must be able to meet project deadlines as outlined by City Staff. The demolition contractor will be required to obtain all necessary City permits, pay applicable fees and provide for appropriate handling and abatement of any hazardous materials encountered. Overall demolition supervision will be provided by a designated Program Staff in conjunction with the interested participant. 6. Funding Mechanism: The assistance will be provided to the applicant upon conclusion of the demolition activity and satisfactory final inspection of the demolition permit, in the form of a ten year forgivable interest-free loan, with a 10% incremental reduction in principal upon each successive year the participant lives in the new home, with complete forgiveness after the tenth year in the home. The annual reduction in principal is tied to the date of completion/owner- • occupancy of the new home and not to the loan closing. If the participant sells or rents the home to a third party prior to the tenth year, the following loan repayment schedule shall apply: If the home is sold before The amount to be repaid upon closing shall be End of the first year, 100% of the loan amount End of the second year, 90% of the loan amount End of the third year, 80% of the loan amount End of the fourth year, 70% of the loan amount End of the fifth year, 60% of the loan amount End of the sixth year, 50% of the loan amount End of the seventh year, 40% of the loan amount End of the eighth year, 30% of the loan amount End of the ninth year, 20% of the loan amount End of the tenth year, 10% of the loan amount After the end of the tenth year, the applicant will be provided with a lien release and the necessary paperwork to record at Ramsey County. The loan shall be administered by the Housing Resource Center, NorthMetro Office, a division of the Greater Metropolitan Housing Corporation (GMHC). The Housing Resource Center or GMHC shall prepare lien release and satisfaction documents as needed. • Page 4