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HomeMy WebLinkAbout86-0325 Gifford Park g6-0 3aS GIFFORD PARK ACQUISITION AND REHABILITATION AGREEMENT WHEREAS, the City of Elgin (hereafter Elgin) is a municipal corporation and a home rule unit pursuant to the constitution and laws of the State of Illinois; and WHEREAS, the Gifford Park Association (hereafter GPA) is an Illinois not- for-profit corporation dedicated to improving housing and conditions in the Elgin Historic District of the City of Elgin; and WHEREAS, the GPA has submitted a proposal whereby the GPA would acquire residential property in the Elgin Historic District which would thereafter be rehabilitated with the assistance of and at the expense of Elgin; and WHEREAS, the City Council of the City of Elgin has determined that it is necessary and desirable to approve said project; and WHEREAS, the parties have agreed upon the terms and conditions governing said project. WITNESSETH NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions contained herein, the parties agree as follows: I. Project Established There is hereby established the Gifford Park Acquisition and Rehabilitation Project (Project) to be jointly funded and administered by the parties. This project shall consist of the acquisition, rehabilitation and resale of deteriorated residential property within the Elgin Historic District. The GPA shall be responsible for the costs of acquisition and resale and Elgin shall be responsible for the cost of reha- bilitation. The project is intended to be an ongoing program with resale proceeds being used to acquire and rehabilitate additional property. The rights, duties and obligations of the parties shall be as set forth herein. II. Funding Sources A. The GPA shall establish and fund a special financial account (known as the Wayne Landers Memorial Fund), for the purpose of providing acquisition and operating capital necessary to acquire deteriorated residential structures (hereafter property) located within the Elgin Historical District as provided in this agreement. This fund shall be restricted as follows: I. The account shall be deposited in the "Participating Lending Institution" (PLI) as determined by Section II(D) herein. 2. Interest earned on the account shall be reinvested in the account and used for current or future rehab properties. 3. Proceeds and/or recaptured profits, if any, earned from the sale of the property shall be returned to the account for future projects as provided in Section VII. 4. Disbursements must be approved by the GPA board in accordance with its By-laws and the President of GPA or an authorized representative. B. The GPA may elect to provide additional financing through first mortgage financing necessary to facilitate the acquisition of properties as provided herein. C. The City of Elgin shall establish and fund, as provided in Section I I(E) below, a special financial account (known as the Elgin Historic District Rehabilitation Fund) for the purpose of providing funds necessary for the rehabilitation of the rehab property. I. The account shall be deposited in the "Participating Lending Institution" as determined by Section I I(D) herein. 2. Interest earned on the account shall be retained in the account and used for current or future projects. 3. Proceeds and/or recaptured profits, if any, earned from the sale of the property shall be returned to the account for future projects as provided in Section VII. 4. Disbursements from the account shall require the prior written approval of Elgin and the GPA. D. The Participating Lending Institution (PLI) shall be as mutually agreed by the parties. The parties shall enter into an escrow or similar agreement with the PLI regarding the Wayne Landers Fund and the Elgin Historic District Reha- bilitation Fund governing their deposit, interest, administration, disbursement and such additional matters as may be deemed necessary and proper by either party hereto. E. Elgin's financial obligations under this agreement shall not exceed $35,000.00. Upon execution of the agreements provided for in Section II(D) above, Elgin shall deposit $35,000.00 in the Elgin Historic District Rehabilitation Fund. III. Payment Responsibilities A. GPA (Wayne Landers Fund) shall be responsible for payment of acquisition and resale costs which shall include but is not limited to the following: I. Down payment. 2. Principal, interest, taxes and insurance. 3. Title Insurance. 4. Legal fees. 5. Utilities. 6. Maintenance of grounds. 2 7. Incidental costs not considered rehabilitation costs including taxes and maintenance cost (ie., heat in winter). 8. All marketing and selling costs. B. Subject to the limitation contained in Section II(E) above, Elgin (Elgin Historic District Rehabilitation Fund) shall be responsible for payment of: I. Costs incurred in the preparation of bid specification package for the property rehabilitation including, but not limited to, preparation of pre- liminary specifications. 2. Cost incurred for the property rehabilitation work. 3. Costs incurred in overseeing of the general contractor to assure com- pliance with the bid packages and applicable codes and ordinances. IV. Acquisition A. GPA shall select potential acquisitionsites within the Elgin Historic District which sites will be rated according to the following criteria: I. Potential impact and visibility. 2. Degree of deterioration. 3. Potential for stimulation of private investment. 4. Historic/architectural significance. 5. Potential for stabilization of a localized area. 6. Potential for expedient turn-around (sale). 7. Economic feasibility. 8. Exterior rehabilitation emphasis. 9. Reduction of housing density. B. From their list of potential acquisition sites, the GPA shall designate preferred sites and shall prepare preliminary cost estimates for acquisition and rehabili- tation for such preferred sites. Elgin will assist GPA in preparing the rehabli- tation cost estimates. Preferred sites shall be subject to the approval of the City Council of the City of Elgin prior to contracting for acquisition. GPA shall review and approve selection of one or more of the preferred sites as permitted within the financial limits of the Wayne Landers Fund and the Elgin Historic District Rehabilitation Fund. C. The GPA shall take all steps necessary to acquire the selected preferred site including but not limited to negotiations, execution of all contracts, obtaining 3 the necessary funding from the Wayne Landers Fund or from other sources pursuant to Section II(B), attorney fees and closing costs. Elgin shall have no financial responsibility for the acquisition of selected preferred sites. V. Rehabilitation A. Rehabilitation plans and specifications along with cost estimates therefor shall be prepared by GPA with the assistance of Elgin. Such plans, specifications and cost estimates shall be submitted to the Elgin Heritage Commission which will review them and make a recommendation to the Elgin City Council. The Elgin City Council shall review the plans, specifications and cost estimate, consider the recommendation of the Elgin Heritage Commission and approve, modify, or reject same. B. When in the joint opinion of the parties due to the complexity of the rehabili- tation or other factors an architect, specification specialist or other profes- sional service is necessary, the GPA may, with the prior advice and consent of Elgin, retain the services of such person. C. GPA shall let all necessary contracts for completion of the rehabilitation consistent with the approved plans and specifications. The rehabilitation contracts, contractors and change orders shall be subject to the prior written consent of Elgin. D. Rehabilitation costs, including costs incurred pursuant to Section V(B) above, shall be paid from the Elgin Historic District Rehabilitation Fund. No con- tracts for rehabilitation shall be approved unless there are sufficient monies in said fund to pay all costs and expenses associated with said contract. All payouts from said fund shall be subject to the prior written approval of Elgin and GPA or their designated agents. VI. Disposal of Rehabilitated Property A. Upon completion of rehabilitation work, or as otherwise mutually agreed by the parties, the GPA shall endeavor to sell the property at its fair market value. Fair market value of the property shall be established by a qualified appraiser approved by the GPA. B. GPA shall take such steps as are necessary to solicit buyers for the property including listing the property in the Elgin Multiple Listing Service. GPA shall endeavor to solicit offers from the greatest number of buyers possible. In the event the property does not sell within nine months of active listing, the GPA may place the property for sale at auction, subject to the prior consent of Elgin as to the minimum acceptable bid. C. GPA shall take all steps necessary to sell the property including execution of all contracts and deeds. D. GPA may lease the property provided such lease shall not affect GPA efforts to sell and convey the property as soon as practical after rehabilitation. It is the expressed intent of the parties that the property is to be resold as soon as practical. Any lease of the property shall be for a term no longer than month to month without the prior consent of Elgin 4 VII. Disbursements of Proceeds A. GPA shall receive and distribute proceeds from the sale or rental of any reha- bilitated property in conformance with this agreement. It is intended that such proceeds wil be used to finance additional acquisitions and rehabilitations as provided herein. B. Proceeds from the sale of any proeprty shall be disbursed as provided below: I. Full payment of any mortgage or lien on the property necesasry to obtain clear title. 2. In the event there are proceeds remaining after payment provided in Subparagraph I above, payment shall be made to the GPA as reimburse- ment for, and in an amount equal to, costs and expenses incurred pursuant to Paragraph III(A) for the subject property. 3. In the event there are proceeds remaining after payment provided in Subparagraph (I) and (2) above, payment shall be made to the Elgin Historic District Rehabilitation Fund as reimbursement for, in an amount equal to, costs and expenses incurred pursuant to Paragraph III(B) for the subject property. 4. In the event there are proceeds remaining after disbursements as provided in Subparagraphs (I), (2) and (3) above, such proceeds shall be divided equally between the Wayne Landers Fund and the Elgin Historic Rehabili- tation Fund. C. Proceeds from the rental of the property shall be first applied to GPA's cost and expenses in maintaining the property. Any excess shall be disbursed in the manner provided for sales proceeds pursuant to Subsection (B) above. VIII. Records and Reports A. The GPA shall maintain complete and accurate records regarding the project which records shall include, but are not limited to, financial records and acquisition and sales documents. B. The GPA shall provide Elgin with monthly status reports regarding the project and shall furnish a complete report to Elgin upon the sale of any property. C. Elgin shall have the right to inspect the records of GPA regarding the project during normal business hours. IX. Miscellaneous A. Any approval or review required of Elgin under any section of this agreement may be requested and obtained simultaneous with any other approval or review required of Elgin provided such simultaneous review and approval is appro- priate and feasible, in the opinion of Elgin. B. Either party may terminate this agreement any time after April I, 1989 upon twelve months written notice to the other party. Such termination shall take 5 effect upon the date specified in the written notice, provided, such termina- tion shall not affect, nor shall the parties be released from any obligation herein provided, regarding any property then owned by GPA pursuant to this agreement. C. To the extent permitted by law and except where City Council action is expressly required any approval or action required of Elgin under this agreement may be given or performed by such agent or employee of Elgin to the extent and within such limitations as the City Council may so authorize and establish. IN WITNESS WHEREOF the parties have executed this agreement this day of I A a rt tiJ , 1986. CI F ELGIN By 014 ity Man er Attest: (a a City Clerk GIFFORD PARK ASSOCIATION By Q►'1 Ah Its President Att . 1 AdA Gam, U Secretary 6