the real estate while the tentative developer diligently pursues the completion of all conditions attached by the HRA Board in the award of the designation. Typical conditions may include the following: completion of design and architectural drawings of the project, market study, utility plans, environmental investigations, and preparation of remediation plans, securing of financing, and negotiation of development agreement with staff, which agreement is subject to HRA Board approval. The HRA reserves the right to reject any and all proposals to purchase.
The proposer will be notified that as a condition of being awarded tentative developer status it will be required to provide to the HRA a non refundable ‘Application Fee’ based on the size of the project as follows:
| Estimated total development costs | Application Fee |
|---|
| Under $250,000 | $500 |
|---|
| $250,000 to $1 million | $1,500 |
|---|
| Over $1 million and up to $5 million | $2,500 |
|---|
| Over $5 million and up to $10 million | $5,000 |
|---|
| Over $10 million | $25,000 |
|---|
The HRA will retain the Application Fee whether the project is or is not built, and the proposer will not receive any credit for the Application Fee in the sale price of the land. In addition, the proposer may also be required to provide an 'Expense Deposit' that be used as a deposit to pay for the cost of outside financial, appraisal and legal advisors employed by the HRA and the actual amount will be determined on a project-by-project basis.
Along with tentative developer status or contract rights, the HRA will establish a time limit for (a) tentative status – which can vary, depending on the nature of the proposed project, or (b) completion of the project.
If the project proceeds as proposed, the development will ultimately result in closing on a contract for sale, lease or conveyance of the HRA land. All conveyances will be made by Quit Claim Deed, the property will be conveyed in its AS IS condition and buyers may be required to provide an environmental indemnity to the HRA. With respect to the construction of the project, the developer will be required to comply with all laws and regulations and the City of Saint Paul's affirmative action ordinance (Ch 183 of City's Legislative Code) and vendor's outreach program (Ch 84 of City's Administrative Code). The land reverts back to the HRA if developer fails to timely construct the project. In the HRA Board's discretion, the land may be sold at its market value or the land value may be written down to an amount needed to fill a financing gap for the project. Staff will obtain an appraisal of the land in any event and the appraisal may be made by two outside appraisers or by staff, depending on the circumstances.
If the project does not result in a closing and the tentative developer designation is not extended by the HRA Board, the developer will lose its tentative developer status and HRA's costs will be paid from the developer's Expense Deposit and if costs exceed the Expense Deposit the developer will be obligated to pay the difference, and any unspent Expense Deposit will be returned to the developer.