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Item No: EDA 7B Meeting Date: Feb 27, 2006 Type of Business: EDA-B Administrator Review : ____ City of Mounds View Staff Report To: Honorable Mayor and City Council From: James Ericson, Community Development Director Item Title/Subject: Consideration of Resolution 06-EDA-217, Authorization to Approve a Purchase Agreement and Conduct a Real Estate Appraisal of the Property Located at 2390 County Road 10. Introduction: Based upon the discussion and direction of the EDA at an executive session held on February 13, 2006, staff drafted a letter of intent to the agent representing the owners of 2390 County Road 10 regarding the potential acquisition of the property. The EDA suggested that the City conduct an appraisal of the property to verify that the asking price of the property is appropriate. The sellers have agreed to the terms and conditions articulated in the letter of intent, and request that a purchase agreement to that effect be drafted. Discussion: Appraisal. The EDA directed staff to bring back to the EDA for consideration a resolution to authorize the appraisal of the property. Staff has contacted numerous commercial real estate appraisers and has received proposals from three. The appraisal would be in summary format which would result in a lower cost to the City without any loss of pertinent or relevant data. The arrived property valuation is the same regardless. The following firms have responded with the following proposals: Firm Cost Timeframe R.A. Field & Associates $1,900 4 weeks Tisdell Appraisal Services, Inc. $1,900 2 weeks Orion Appraisals, Inc. $2,800 3-4 weeks ? ? Staff recommends awarding the appraisal contract to the low bidder having the ability to complete the work in the shortest period of time. Since other proposals could be received after this report is drafted, the resolution will not indicate the firm or price, that will be added the night of the meeting based upon all proposals received up to that point. Funding for the appraisal would be from Account 230-4650-3030 (the EDA fund.) Purchase Agreement. Staff has asked Kennedy & Graven to prepare a purchase agreement which formalizes the City’s intent to acquire the property at 2390 County Road 10 under the terms and conditions discussed on February 13, 2006. These conditions, generally, are that the seller arrange to remove the underground fuel tanks and arrange to conduct a Phase 1 and Phase 2 environmental analysis and conduct any necessary remediations as may be specified in said analyses. The City will have the right to terminate the agreement if the site is not “clean” or if the appraised value does not support the asking price of $625,000.