13. Use of RALPH funds to acquire parcel at Bluff Cr Drive & Pioneer Trail I . 13
CITYOF ...............
1 _
vi CHANHASSEN
1
0 if-
690 COULTER DRIVE • P.O. BOX 147• CHANHASSEN, MINNESOTA 55317
(612) 937-1900 • FAX(612) 937-5739 Action by City M fnistrator
I Endorsed ✓. 0t
Modined
1 MEMORANDUM Rejected._.____
Date
TO: Don Ashworth, City Manager Date Submitted to Commission
IFROM: Paul Krauss, Planning Director ')/q.k- Date Submitted to Couttcfl
DATE: March 22, 1990
1 SUBJ: Use of RALF Funds to Acquire Portions of a 109.74 Acre
Site Which Are Required for the Future Right-of-way of
1 Highway 212
PROPOSAL
II Since last fall, staff has occasionally discussed with the City
Council the State-financed funding program that could be used to
assist in the early acquisition and protection of right-of-way that
1 would be required for the construction of Hwy. 212. The program is
called the Right-of-way Acquisition',Loan Fund known by the acronym
RALF. Under the program, funds could be appropriated to the City
II through the Metropolitan Council, if the project is approved, to
allow the city to acquire future 'right-of-way from a willing
seller. The program allows the price',for the site to be dictated
by two independent appraisals conducted by MnDOT approved
1 appraisers. The City would acquire and hold the land for ultimate
resale to MnDOT at such time as construction is imminent. The land
would then be sold to MnDOT at the price the City acquired it. The
I goal of the program is to allow for right-of-way to be preserved at
lower cost than might have otherwise been the case and to assist
property owners whose ability to develop their land or to sell
their property has been hampered .by .future .highway _plans.
Staff is seeking City Council approval of a resolution in support
of the application for .RALF funding to acquire;:impacted portions of
I this site. The 110 acre site isilocated at the intersection of
Bluff Creek and Pioneer Trail between 50 and 60 acres of the site
is directly impacted by future,"tright-of-way needs. Staff has
1 spoken with the owners on several occasions regarding potential
platting of the site. While no application for subdivision has
been processed, it is clear to staff from the data that has been
I prepared that a rural subdivision is a legitimate possibility on
this property. Staff has asked the applicants not to proceed with
this proposal as a subdivision but rather to consider use of the
RALF program.
II
I
II
Mr. Don Ashworth
March 22, 1990
Page 2
We wish to make it clear that the RALF program is not a panacea for
all the problems associated with highway construction. There are
costs that will be incurred by the City in preparing the
application and in managing the property during the time before
which MnDOT acquires it. We will do our best to attempt to
document these staff expenses and any actual outlays that may be
required. Since it is our understanding that, for the most part,
we should be able to gain compensation under the RALF program to
allow the City to break even when the land is reacquired by MnDOT.
The RALF program also has limitations in that the property owners
do not have an ability to dispute the value of the property as they
would during normal condemnation or acquisition program. However,
' even with its failings, the RALF program is an innovative one for
the State and to the extent that it can be used to protect needed
right-of-way, we believe it is in the public and City's best
interests to go through the program. We also want to protect the
' City from incurring costs that might not be compensated. The two
appraisals that are required will require an outlay of funds.
Staff is proposing to require that the property owners escrow the
' appraisal fees with the city. This will insure that these fees
will be paid even if, after receiving the appraisals, the owners
determine that they do not wish to proceed with the RALF
' application. The City will select the appraisers and they will be
under contract with us.
RECOMMENDATION
' Staff recommends that the City Council approve the attached
resolution.
' ATTACHMENT
1. RALF Resolution.
2. Request from property owners.
3. Copies of proposed subdivision.
4. Background materials previously sent to the City Council.
I
II
CITY OF CHANHASSEN -
CARVER AND HENNEPIN COUNTIES, MINNESOTA
DATE: RESOLUTION NO. : '
MOTION BY: SECONDED BY:
A RESOLUTION AUTHORIZING THE USE OF I
RIGHT-OF-WAY ACQUISITION LOAN FUNDS (RALF)
WHEREAS, with the adoption of the Official Map for the Trunk I
Highway 212 Corridor, the City is responsible for the preservation
of the future right-of-way; and
WHEREAS, the City may request the use of funds from the 1
Metropolitan Council to help secure and preserve the future right-
of-way of the T.H. 212 corridor through the Right-of-way
Acquisition Loan Fund (RALF) program; and
WHEREAS, the site being considered for acquisition is owned by
the Bluff Creek Investment Company and the RALF Funding request is
being made at their request. The 110 acre site is located at the
intersection of Pioneer Trail and Bluff Creek Drive.
NOW, THEREFORE, BE IT RESOLVED, that the Chanhassen City I
Council hereby authorizes and directs staff to use the RALF program
funding from the Metropolitan Council to secure and preserve future
right-of-way of the T.H. 212 corridor. ,
Passed and adopted by the Chanhassen City Council this
day of , 1990. ,
ATTEST
1
Don Ashworth, City Manager Donald J. Chmiel, Mayor I
11
1
I
II
BLUFF CREEK INVESTMENT COMPANY
RESOLVED, that Bluff Creek Investment Company
request that the City Council of the City of Chanhassen,
Minnesota, direct the city staff to proceed with a request to
11 the Metropolitan Council of the Twin Cities Area for funding
from the Right-of-Way Acquisition Loan Fund, and to take
other such steps as required to permit the City of Chanhassen
' to purchase the portion of the land owned by Bluff Creek
Investment Company that is designated for future acquisition
by the Minnesota Department of Transportation; and
RESOLVED further, that the partners of Bluff Creek
Investment Company authorize Richard J. Olson and Charles
Hann to represent the interest of all Partners in the
procedures or negotiations that may be required to obtain a
valid purchase offer from the City of Chanhassen.
Approved as of February 19, 1990, by the partners of
Bluff Creek Investment Company.
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C 1 TY OF
CHANHASSEN
QL7e" f 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317
' (612) 937-1900
MEMORANDUM
1 TO: Don Ashworth, City Manager
FROM: Paul Krauss, Director of Planning Ct..-
DATE: October 4, 1989 .
' SUBJ: Right-of-way Acquisition for the Hwy. 212 Corridor
With the imminent adoption of the Official Map for Hwy. 212,
staff has been receiving a number of requests for early acquisi-
tion of right-of-way. Most of the property owners who have con-
tacted us are aware that the Metropolitan Council is administering
Right-of-Way Acquisition Loan Fund, known by the acronym RALF.
The RALF program is designed to assist in minimizing the
hardships of property owners that are normally experienced when
highway construction is imminent but official acquistion of
right-of-way by MnDOT is still some years in the future.
The RALF program is essentially designed to allow cities utilize
a revolving loan program to acquire rights-of-way on properties
' where development is imminent or where the existence of the high-
way corridor is causing a hardship for the homeowner. Under the
program, the City Council would have to authorize application to
1 the Metropolitan Council for the loan. A price for the property
is established by MnDOT appraisers and if agreeable to all par-
ties, the City buys the right-of-way and holds onto it until
' MnDOT is prepared to acquire it. During the time that the prop-
erty is owned by the City, we would be responsible for its main-
tenance and leasing if we choose to do so. There is no financial
• benefit to the City as the property is resold to MnDOT for the
price at which we acquired it. The money is then placed back
into the revolving loan fund. The advantage of the program is
that it provides ability to work with property owners in the City
' to adjust to a difficult situation and to lock up the right-of-
way for a project that is in the public interest. Staff antici-
pates the need to bring RALF funding requests before the City
' Council shortly after the adoption of the Official Map. A copy
of the RALF program guidelines issued by the Metropolitan Council
are attached to this memo.
' Staff has been in contact with several property owners concerning
a proposed subdivision known as Bluff Creek. It is a large lot
rural subdivision that would create 11 home sites on a 110 acre
I
1
Mr. Don Ashworth - II
October 4, 1989 '
Page 2
parcel. The site is bisected by Hwy. 212 right-of-way and it
appears to be the applicant' s intent to use the application for
subdivision as documentation to obtain funding under the RALF
program. Staff believes that there may be some rationale to sup-
port the RALF application but that there may well be other issues
that the City Council would need to consider. These concerns are
outlined in a letter from staff to the applicants, which is also
attached to this memo.
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CITY OF
AINAssEN
' 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317
(612) 937-1900
October 2, 1989
I
Bluff Creek Investment Co.
Attn: Mr. Richard J. Olson, Partner
4015 West 65th Street
Edina, MN 55435
Dear Mr. Olson:
I received your letter of September 22, 1989, regarding the pro-
posed Bluff Creek Subdivision for which an application for review
by the Planning Commission is pending. You requested that I pre-
pare a letter outlining ways in which the submittal fails to con- - -
' form to City Ordinances and regarding the City' s position with
respect to the application and future disposition.
II - The Bluff Creek submittal calls for the platting of 11 large lot
single family lots on a 110 acre site located near the intersec-
tion of Pioneer Trail and Bluff Creek Drive. I reviewed the
plans and find it is deficient in the following areas:
1. It is not clear as to whether or not the proposed Wood Bluff
Circle is to be a private or public street. Construction
details should be provided for review and approval.
2. Detailed information regarding the proposed on-site sewer
' systems has 'not been provided as required by the City
Subdivision Ordinance.
'3. The site is bi-sected by the Highway 212 corridor. Staff
' would recommend the City seek to obtain, through dedication, -
as much of the right-of-way as is considered legally viable
by the City Attorney. In initial discussions, it appears as
though we would have grounds to require a 60 foot wide corri-
dor along the alignment.
•
The presence of the Hwy. 212 corridor warrants further
' discussion. In your letter you indicated some degree of uncer-
tainty regarding the alignment of the highway. While the road. -
has been the subject of a good deal of planning, the alignment is
11 now firm and the City will shortly be adopting the Official MnDOT
Map. To the best of my knowledge, Brian Olson, your represen-
tative, has been staying informed about the highway for the past
year.
II
Mr. Richard J. Olson
October 2, 1989 _ 11
Page 2
Given the location of the highway, I feel I would be irrespon- I
sible if I did not ask you to consider redesigning the plat. I
believe it is possible to locate most or all of the 11 homesites
you would potentially be eligible for, outside the Hwy. 212 ,
corridor. If you plat the site as proposed, you would probably
have difficulty selling the lots and the City would not be in a
position to issue building permits unless the variance procedure
outlined in the Official Mapping ordinance has been approved.
As we indicated in our meeting, if you desire to have City action
on the current proposal, it would be our recommendation that it
be approved contingent upon the three items outlined above.
As you are aware, staff has a concern regarding your ultimate ,
intent for this plat. It has been indicated by Brian Olson that
the primary reason for platting at this time is to position the
property for partial acquisition using the RALF funding program
administered by the Metropolitan Council for early acquisition of
rights-of-way threatened by development. I have indicated that
I am not highly receptive to the idea of your presenting a plat,
which you do not apparently have an intention of carrying through . II
to the final plat stage simply to position your request for the
RALF funds. However, should you wish to proceed, we will handle
your plat in the usual manner conditioned on those items outlined
above. It was further indicated that City Staff is willing to
work with you and your partners to process an application for the
RALF funding should you in fact be eligible for it. We believe -
that the plat as proposed generally represents a viable use of
the property consistent with City Ordinances and could be used to
justify utilization of this funding program. Our willingness to
work with you on the RALF funding program, however, is con-
ditioned on several things. These include:
1. Your working with the City to demonstrate compliance with
program guidelines. Brian Olson, who is working with you on
this matter, has the program and should be in a position to
assist you in developing this information.
2. The City's application for these funds will be conditioned
upon the City Council's willingness to direct staff to under-
- take the program. City Council support is mandatory in this
program and it is the City that would be acquiring the
funds and would be holding the property until final acquisi-
tion
by MnDOT. 1
3. Upon review of the program, the City Council may wish to . -
provide requests for RALF funding. If this is the case, your
application would have to be reviewed under any criteria that
are developed.
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Mr. Richard J. Olson
' October 2, 1989
Page 3
' 4. RALF funding program is administered by the Metropolitan
Council and ultimately the decision as to whether or not the
application is a viable one is up to them.
I hope this letter adequately responds to your need for infor-
mation. I look forward to hearing from you as to how you wish us
' to proceedon this matter. I expect that the City Council will
adopt the "Official Map" of the Hwy. 212 corridor at their
meeting of October 25, 1989, after which time we would be eli-
gible to begin application for RALF funding.
' Should you have any additional information, please feel free to
contact me.
' Sincere)y,
IIPaul Krauss, AICP
Director of Planning
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cc: Mr. Brian Olson, Richter Land Development
' Mr. Roger Knutson, City Attorney
Mr. Don Ashworth, City Manager
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Bluff Creek Investment Co.
4015 West 65th Street I
Edina, MN 55435
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September 22, 1989 •-
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. Mr. Paul Krauss I
City of Chanhassen
Planning Director II P.O. Box 147
Chanhassen, MN 55317 _ _
Dear Mr. Krauss: - ' I
I am writing as the partner authorized to represent Bluff Creek : • -
Investment Company in connection with the . Company's proposed II
development plan filed with the City.
As a follow-up to our meeting yesterday, I want to first thank you
and your associates for the patient and informative manner in which '
you helped me understand the factors relevant to the City's
consideration of our application.
With respect to your suggestion that the Company withdraw its
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application and examine alternative approaches relative to our
property, we have given the suggestion careful consideration. As you •
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know, we have owned the land for more than fifteen years and our
investment objective has been to participate in the development of
the property for higher use, either by means of a joint development
venture or by sale of the land to a developer. We have pursued this .
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objective diligently during the past five to six years as development
by others progressed in the area.
We have been aware for a number of years that the Department of II
Transportation was examining alternatives for rerouting Highway 212
- and that our property could be affected by the proposed route. We
recognized this uncertainty as a significant factor in our inability II
to make progress in the development of the property. When we saw
last year that the City was proceeding to make a permanent
improvement in Bluff Creek Drive, it seemed evident that the City, at _ '
least, was not expecting the Highway 212 routing to affect Bluff'
Creek Drive and that we ought not assume that the highway routing,
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' when finally approved, would affect development plans for our
property.
We learned of the City's plans to upgrade Bluff Creek Drive about two
years ago and received notice of the easement requirements in early
1988. On May 5, 1988 Bluff Creek Investment Company fully cooperated
' with the City by granting both temporary and permanent easements to
allow the upgrading of Bluff Creek Drive. In return for granting
these easements, we received one dollar as compensation. Discussions
relative to the development plan for the property have been underway
with the staff for more than a year and we made formal application on
July 20, 1989.
In view of this background and the fact that there is no certainty as
to the exact location of Highway 212 and Bluff Creek Investment
Company has not received written communication relating to our
I - application, we have decided at this time that we cannot withdraw .the
application.
Questions with respect to which we would appreciate receiving
' comments from you by letter are the following:
1. Does the plan we have submitted fail in any material way to
' conform to City ordinances?
2•. What is the City's position with respect to our application and
' what are its recommendations relative to how the application
should be handled at this point?
Thank you for your consideration of the matter. If you have comments
' about the questions that should be discussed separately from a
letter, please phone me anytime at 927-1117.
' Yours very truly,
Richard J. Olson
' Partner
' RJO:bl
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GUIDELINES TO ALLOCATE FUNDS
FOR METROPOLITAN HIGHWAY RIGHTS OF WAY
June 1986
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Metropolitan Council of the Twin Cities Area I
300 netro Square Building, 7th and Robert Streets
St. Paul, Minnesota 55101
Telephone: (612) 291-6359
Publication No. 561-86-041
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GUIDELINES TO ALLOCATE FUNDS
' FOR METROPOLITAN HIGHWAY RIGHTS OF WAY
Revised And Amended: June, 1986
' INTRODUCTION
The Metropolitan Council is charged with planning for the orderly and economic
' development of the Twin Cities Metropolitan Area. As part of that work, the
Council plans for the direction transportation investments should take through
the year 2000. The Council 's Transportation Policy Plan outlines a
metropolitan highway system consisting of interstate highways and other major
' arterials. The interstate system is almost completed. Several other parts of
the metropolitan highway system, especially in the developing areas, will not
be built for several years. Many highways are not far enough in the planning
process to enable the constructing agency to purchase right of way. in some
' instances, counties or municipalities have attempted to protect a proposed
highway right of way from development by adopting an official map. However,
these local governments have not always had sufficient funds to acquire small
I -- parcels of land, which has sometimes forced them to grant building permits--
within a highway right of way.
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' in 1982 the Minnesota_ Legislature acted to help counties and muncipalities
acquire these parcels by adopting the Metropolitan Right-of-Way Reservation
Act (Minn. Stat. Sec. 473.167, Subd. 2) . The law authorized the Metropolitan
Council to levy a regional property tax of up to 5/100ths of a mill to
' establish a revolving fund for advance acquisition of metropolitan highway
rights of way threatened by imminent development. The funds are used by the
Council to make loans to counties, towns and cities, to be repaid at a 'later
' date to purchase property within rights of way of sta _ trunk highways or
highways on the metropolitan system. Such loans accordingly are made without
reference to the actual acquisition and construction schedules to be developed
' by the constructing agency.
The first proceeds of the tax (about $1 million annually) were available in
July 1983. Since then several cities have received loans to purchase land
' within the rights-of-way of two planned highways. An annual status report on
the revolving fund is prepared for the Council by staff to assist the Council
in determining a levy amount by October.
In 1985 the Minnesota Legislature amended the Metropolitan Right-of-Way
Reservation Act to allow the Council to use the revolving fund for loans to
purchase "hardship" properties in a proposed State Highway project. These
' loans also can be used to pay for relocation costs.
Although the law is fairly specific regarding eligibility and procedures,
' certain aspects require clarification. The Council proposes the guidelines
below for distribution of these funds.
' Part A describes the procedures for advance acquisition loans to purchase land'
when development is imminent. These procedures have been modified slightly
since the original guidelines were adopted in December 1983.
' Part B reflects the amended legislation and describes the procedures to use for
hardship loans to purchase homestead properties.
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PART A: Advance Acquisition Loans
I. Eligibility Guidelines
1. Any county, town or statutory or home rule city within (or partially
within) the Seven-County Metropolitan Area is eligible to apply for a
loan. The Minnesota Department of Transportation is not eligible. .
2. Loans are for the purchase of property within a proposed right-of-way 1
of a state trunk highway shown on an official map adopted pursuant to
Minn. Stat. 394.361 or 462.359. Loans are also for the purchase of
property within a proposed right-of-way of an interstate freeway or
major arterial highway designated by the Metropolitan Council as a part
of the metropolitan highway system plan and approved by the Council
pursuant to Minn. Stat. Sec. 473.167, Subd. 1. _ I
3. The Council shall make loans only to avert the imminent conversion or
the granting of approvals that would allow the conversion of property •
to uses jeopardizing its availability for highway construction. -
4. Loans will be made only for the purchase of property from a willing -
seller, not by condemnation.
5. Property to be acquired must have a marketable title and may not be
park land or land which is either on or eligible for inclusion on a ' II historic register.
6. " Applications will be considered as they are received, not on a periodic
funding cycle.
7.II . Advance Acquisition Loan Application Procedures
A. Preliminary Approval ,
1. The applicant submits, for preliminary Council approval , an application
including, as a minimum: ,
a. Resolution of local jurisdiction authorizing loan application and .
purchase of property. '
b. Statement of need to acquire property, including evidence regarding
• imminent conversion.
requested.
Amount of loan re
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d. A legal description of the property to be acquired, its acreage,
and a map showing the property in relation to the highway right-of-
way. -
e. A statement of the applicant's eligibility to incur this debt. ,
(Form available from the Council .) v.
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2. For land within state trunk highways, Council staff will forward the
application to Mn/DOT for advisory comments within 45 days. At this
' time, Mn/DOT will have the option to acquire the land itself.
3. The Council, as part of /2, will request that Mn/DOT determine whether
' or to what extent the land lies within a proposed right-of-way. If
MnDOT determines that any part lies outside the proposed right-of-way,
MnDOT shall be requested to determine whether such•part has economic'
' value. If MnDOT determines such part to be an uneconomic remnant, the
entire parcel shall be eligible for purchase with a right-of-way
acquisition loan. If MnDOT determines such part to be an economic
remnant, only such part as lies within the proposed right-of-way shall
be eligible for purchase with a right-of-way acquisition loan. The
Council shall accept Mn/DOT's determination regarding the economic
value of excess property.
I4. Within 75 days from original receipt of preliminary application, the
Council must consider the application, including any Mn/DOT comments,
and will either disapprove or give preliminary approval and authorize
Ithe applicant to proceed with the application process.
B. Final Approval
' 1. After receiving preliminary approval, the applicant must obtain and
submit to Mn/DOT an appraisal (two appraisals if purchase price is over •
$100,000) made by an appraisor on the list of Qualified Appraisors
' Available for State Contracts. Mn/DOT will have 30 days to certify the
. appraisal . No offer can be made to the property owner until Mn/DOT
certifies the appraisal .
' 2. After Mn/DOT certifies the appraisal , the applicant may begin
negotiations with the property owner. If the negotiated sale price is
' above the appraised value of the property (i .e., an administrative
settlement) Mn/DOT must approve it. In cases where the property to be
acquired is not within a state highway right-of-way, the appraisal
review would be performed by the constructing agency.
' 3. The applicant submits the appraisal certification, purchase agreement,
(administrative settlement, if required) , statement of cost, and draft
loan agreement to the Council as a final application.
4. The Council finally approves or disapproves the loan. If the loan is
approved, a loan agreement for the purchase price of the property and
' the costs incurred by the applicant may be executed.
III. Loan Agreement
' After the Council approves a loan application, Council legal staff will prepare
a final loan agreement that will include at least the following points and any -
others the Council might specify as a condition of approval .
1. Loans bear no interest. %.
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2. A private property owner may elect to receive the purchase price either in
a lump sum or in not more than four annual installments without interest on
the deferred installments. If the purchase agreement provides for
installment payments, the Council shall make the loan in installments
corresponding to those in the purchase agreement.
3. Advance acquisition loans may not include relocation costs of persons or ,
property. Relocation will be provided in accordance with Minnesota •
Statutes 117.50 to 117.56.
4. The recipient of a loan shall convey the property for the construction of
the highway to the constructing agency at the same price that the recipient
paid for the property. '
5. In the event the loan recipient is also the highway constructor (such as
for a county highway) the loan shall be repaid at a time prior to actual
construction.
6. Loan recipients shall submit an annual report by June 30 on the status of
the loan.
7. Upon notification by the Council that the plan to construct the highway has
been abandoned or the anticipated location of the highway changed, the
recipient shall sell the property at a market value in accordance with the
procedures required for disposition of property. -
8. All net rents and other money received because of the recipient's ,ownership '
_ of the property, and all net proceeds from the conveyance or sale of the
property, shall be paid to the Council .
9. Every consideration should be given to renting and maintaining acquired
improvements (including buildings) in a manner compatible with the
surrounding environment until full project acquisition. -
PART B: Hardship Loans
I . What is "Hardship"? • '
On occasion, a homeowner must sell his home but is unable to do so only •
because the property lies within the right-of-way of a planned road. This
is known as a hardship situation. If certain factors are satisfied the
Metropolitan Council may lend a community the funds to buy the homestead
property before the property is acquired for highway construction.
Hardship situations fall under one of the following two categories:
1. Health. •. • - • ,
a. Advanced age, debilitating illness or injury, or other long-term -
handicap where present housing facilities :are inappropriate or '
cannot be maintained by the owner.
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b. Other extraordinar y conditions which pose a significant ficant threat to
the health, safety, or welfare of the owner-occupants or
' household member for whom they are responsible.
2. Financial.
' a. Litigation (probate) .
' b. Loss of employment and the need for distant relocation for other
employment.
c. Retirement and financial inablility to maintain current
' residence.
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d. Pending mortgage foreclosure. _
II e. Job transfer to a distant site of employment.
f. Any documented circumstance similar in impact to those stated
Iabove.
11. Documenting Hardship
' Qualifications for hardship acquisitions must be fully documented.
Examples of acceptable documentation include, where appropriate:
Ii. A doctor's statement fully and clearly describing the medical reasons
for which the patient should relocate.
2. A certificate from a real estate agent indicating the price for which
the property was listed on the open market for at least 90 days. The •
agent must also certify that his good faith effort to sell the property
was unsuccessful .
3. A financial statement explaining how financial difficulties
constitute the basis for hardship.
4. A letter from employer affirming that the owner is to be transferred .
to a specified location, or similar documentation regarding loss of
' employment.
5. Court records and documents relating to any legal actions which
provide support for the hardship basis.
6. Those portions of an income tax return supporting the hardship
circumstance.
The above cannot be construed as being all inclusive for every situation.
Since it is conceivable that there will be times when the above documentation
would not constitute appropriate or sufficient documentation, it would be
acceptable to provide alternative data that will accomplish the required N.
verification.
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III. Eligibility Requirements
For a jurisdication (i .e., an "acquiring authority") to be eligible for a
hardship loan, the property to be acquired must meet all of the following
requirements:
1. Be an owner occupied single family dwelling which may include the '
surrounding land of 10 or fewer acres.
2. Be located in any county, town or statutory or home rule city within
the Seven-County Metropolitan area.
3. Be located within a proposed state trunk highway right-of-way. 1
4. The property may not include park land or land that is either on or
eligible for inclusion on a historic register.
5. In addition, the owner and/or applicant must document that a hardship
exists.
IV. Hardship Loan Application Procedures
A. Preliminary Approval
I. The Acquiring Authority submits to the Metropolitan Council for 11
preliminary approval:
a. A statement that the five eligibility requirements are met.
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b. A written request from the property owner asking for hardship
acquisition, setting forth the nature of the hardship.
c. Documentation of inability to sell property at the fair market
value as a result of highway project development. (Submit '
realtor's certification that property has been on the market and
unsold for 90 days) .
d. A statement that federal or state participation is not available. '
e. A statement from the authority that relocation will be provided in
accordance with Minn. Stat. 117.50 to 117.56. '
f. Mn/DOT statement that the acquisition will not influence the
environmental assessment of the project, including the "no build"
alternative.
g. An estimate of the loan amount based on estimate of the fair
market value of the homestead property plus relocation costs and
less salvage value.
h. A legal description of the property to be acquired, its acreage,
and a map showing the property in relation to the highway right-of-
way. °•
i. A statement of the applicant's ability to incur this debt. (Form I
available from the Metropolitan Council) .
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dentificaiton of any (such j. I y known or obvious cleanup problems (suc as
hazardous waste) on the property.
2. The Council staff will forward the application to Mn/DOT for advisory
comments within 45 days. At this time, Mn/DOT will have the option to
' acquire the property itself.
3. The Council, as part of 12, will request that MnDOT determine whether•
' or to what extent the land lies within a proposed right-of-way. If
Mn/DOT determines that any part lies outside the proposed right-of-way,
Mn/DOT shall be requested to determine whether such part has economic
value. If Mn/DOT determines such part to be an uneconomic remnant, the
' entire parcel shall be eligible for purchase with a right-of-way
acquisition loan. If Mn/DOT determines such part to be an economic
remnant, only such part as lies within the proposed right-of-way shall
. be eligible for purchase with a right-of-way acquisition loan. The
Council shall accept Mn/DOT's determination regarding the economic
value of excess property.
I .. 4. Within 75 days from original receipt of the preliminary application,
the Council will consider the application, including any Mn/DOT
-comments, and will either disapprove or give preliminary approval and
' authorize further negotiations by the applicant.
8. Final Approval
1. After receiving preliminary approval , the applicant will obtain and
submit to Mn/DOT an appraisal (two appraisals if purchase price is over
• $100,000) made by an appraisor on the list of Qualified Appraisors
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Available for State Contracts. Mn/DOT will have 30 days to certify
the appraisal . No offer can be made to the property owner until Mn/DOT
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certifies the appraisal .
2. After Mn/DOT certifies the appraisal , the applicant may begin
negotiations with the property owner. If the negotiated sale price is
above the appraised value of the property (i .e., an administrative
' settlement)' Mn/DOT must approve it.
3. The applicant submits the appraisal certification, purchase agreement,
(administrative settlement, if required) , statement of cost, and draft
loan agreement to the Council as a final application.
4. The Council finally approves or disapproves the loan. If the loan is
' approved, a loan agreement for the purchase price of the property and
the costs incurred by the applicant may be executed.
V. Loan Agreement
After the Council approves a loan application, Council legal staff will prepare
' a final loan agreement that will include at least the following points and any"
others the Council might specify as a condition of approval .
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1. Loans bear no interest.
2. A private property owner may elect to receive the purchase price either in
a lump sum or in not more than four annual installments without interest on
the deferred installments. If the purchase agreement provides for
installment payments, the Council shall make the loan in installments
correspondeing to those in the purchase agreement.
3. A real estate agent may not receive a commission or any other compensation 1
from a•property owner if the property is purchased with a hardship loan.
4. The recipient of a loan shall convey the property for the construction of
the highway to the constructing agency at the same price that the recipient
paid for the property.
5. Loan recipients shall submit an annual loan status report by June 30. 1
6. Upon notification by the Council that the plan to construct the highway has
been abandoned or the anticipated location of the highway changed, the-
recipient shall sell the property at a market value in accordance with the
procedures required for disposition of property.
7. All net rents and other money received because of the recipient's ownership 1
of the property and all net proceeds from the conveyance or sale of the
property, including relocation costs, shall be paid to the Council .
8. Every consideration should be given to renting and maintaining acquired
improvements (including buildings) in a manner compatible with the
surrounding environment until full project acquisition. 1
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II HIGHWAY RIGHT-OF-WAY REVOLVING FUND
MINN. STATUTES 473.167, SUB. 2
Subd. 2 (LOANS FOR ACQUISITION) The Council may make loans to counties,
towns, and statutory and home rule charter cities within the Metropolitan Area
for the purchase of property within the right-of-way of a state trunk highway
shown on an official map adopted pursuant to section 394.361 or 462.359 or for
' the purchase of property within the proposed right-of-way of a principal or
intermediate arterial highway designated by the Council as a part of the
metropolitan highway system plan and approved by the Council pursuant to
subdivision 1. The loans shall be made by the Council, from the fund
' established pursuant to this subdivision, for purchases approved by the
Council. The loans shall bear no interest. The Council shall make loans only
to avert the imminent conversion or the granting of approvals which would allow
' the conversion of property to uses which would jeopardize its availability for
highway construction. The Council shall not make loans for the purchase of
property at a price which exceeds the fair market value of the property or
which includes the costs of relocating or moving persons or property. A
II -- private property owner may elect to receive the purchase price either in'a -lump
sum or in not more than four annual installments without interest on the
deferred installments. If the purchase agreement provides for installment
' payments, the Council shall make the loan in installment corresponding to those -
in the purchase agreement. The recipients of an acquisition loan shall convey
the property for the construction of the highway at the same price which the
recipient paid for the property. Upon notification by the Council that the
' plan to construct the highway has been abandoned or the anticipate location of
the highway changed, the recipient shall sell the property at market value in
accordance with the procedures required for the disposition of the property.
' All rents and other money received because of the recipient's ownership of the
property and all proceeds from the conveyance or sale of the property shall be
paid to the Council . The proceeds of the tax authorized by subdivision 3, all
' money paid to the Zouncil by recipients of loans, and all interest on the
proceeds and payments shall be maintained as a separate fund. For
administration of the loan program, the Council may expend from the fund each
year an amount no greater than three percent of the amount that a metropolitan
area tax levy of five one-hundredths of a mill would raise in that year.
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
' Section 1. Minnesota Statutes b 1984, section 47 .167, is amended
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subdivision to read:
Subd. 2a. (HARDSHIP ACQUISITION AND RELOCATION) . (1) The council may make
hardship loans to acquiring authorities within the metropolitan area to-
' purchase homestead property located in a proposed state trunk highway right-of-
way or project, and to provide relocation assistance. Acquiring authorities
are authorized to accept the loans and to acquire the property. Except as
provided in this subdivision, the loans shall be made as provided in '
' subdivision 2. Loans shall be in the amount of the appraised fair market value
of the homestead property plus relocation costs and less salvage value. Before ,
construction of the highway begins, the acquiring authority shall convey the
property to the commissioner of transportation at the same price it paid, plus
relocation costs and less its salvage value. Acquisition and assistance under
this subdivision must conform to sections 117.50 to 117.56.
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Subdivision 3, is amended to read:
Subd. 3. (TAX.) The council may levy a tax on all taxable property in the
metropolitan area, as defined in section 473. 121, to provide funds for loans
made pursuant to subdivisions 2 and 2a. The tax shall be certified by the
council, levied, and collected in the manner provided by section 473.08, the
tax shall be' in addition to that authorized by section 473.249 and any other .
law and shall not affect the amount or rate of taxes which may be levied by the
council or any metropolitan agency or local governmental unit. The amount of
the levy shall be as determined and certified by the council, except as '.
otherwise provided in this subdivision. The tax shall not be levied at a rate
higher than five one-hundredths of one mill . The tax shall not be levied at a
rate higher than that determined by the council to be sufficient, considering
the other anticipated revenues of and disbursements from the loan fund, to
produce a balance in the loan fund at the end of the next calendar year equal
to twice the amount that a tax levy of five one-hundredths of a mill would
raise in that year. .
Sec. 3 (AFFECTED COUNTIES.)
Sections 1 and 2 are effective only in the counties of Anoka, Carver, Dakota
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(excluding the city of Northfield) , Hennepin (excluding the city of Hanover) ,
Ramsey, Scott (excluding the city of New Prague) , and Washington. I
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(b) The council may make hardship loans only when:
(1) The owner of affected homestead property requests acquisition and II
relocation assistance from an acquiring authority;
(2) federal or state financial participation is not available;-
CO the owner is unable to sell the homestead property at its
appraised market value because the property is located in a proposed
state trunk highway right-of-way or project as indicated on an official map
or plat adopted under sections 160.085, 394.361, or 462.359;.
(4) the appraisal of the fair market value of the homestead property_
has been approved by the council . The council 's approval shall not be •
unreasonably withheld; and
(5) the owner of the homestead property is burdened by circumstances•
that constitute a hardship, such as catastrophic medical expenses; a
transfer of the homestead owner by his or her employer to a distant site of
employment; or inability of the owner to maintain the property due to
physical or mental disability or the permanent departure of children from
the homestead. •
(c) For purposes of this subdivision, the following terms have the meaning
given them:
(1) "Acquiring authority" means counties, towns, and statutory and
home rule charter cities in the metropolitan area.
CO "Homestead property" means a single-family dwelling occupied by
the owner, and the surrounding land, not exceeding a total of ten acres.
(3) "Salvage value" means the probable sale price of the dwelling and
other property that is severable from the land if offered for sale on the
condition that it be removed from the land at the buyer's expense, allowing
a reasonable time to find a buyer with knowledge of the possible uses of the
property, including separate use of serviceable components and scrap when s•
there is no other reasonable prospect of sale. .
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