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03-1114�� `/�� / �� Council File # D✓ y ( 1 � ! I 1J Green Sheet # J�41�� RESOLUTION CITY OF SA1N�, PAUL, MINNESOTA 31 Referred To Presented By Committee: Date 1 WHEREAS, Citizen Service Office, Division of Code Enforcement has requested the City Council 2 to hold public hearings to consider the advisability and necessity of ordering the repair or wrecking and 3 removal of a three-story, wood frame, duplex with a small, wood frame utility shed located on property 4 hereinafter referred to as the "Subj ect Property" and commonly known as 1863 Ighlehart Avenue. This 5 properiy is legally described as follows, to wit: 7 Lot 24, Block 22, Memam Park, Ramsey Co., Minn. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 WHEREAS, based upon the recards in the Ramsey County Recorder's Office and information obtained by Division of Code Enforcement on or before July 16, 2003, the following are the now known interested or responsible parties for the Subject Property: Rae O. Bauer, fka Rae O. Hegdahl, 1863 Iglehart Avenue, St. Paul, MN 55104; Rae O. Bauer, fka Rae O. Hegdahl, 5882 Oxboro Avenue N, Oak Park Heights, MN 55082; Bank of America, 475 Cross Point Parking, Getzville, NY 14068, Attn: Bax�lauptcy Dept., Ronnanisha Lumpkin; First Bank, N.A.,2383 University Avenue, St. Paul, MN 55114; First Bank of South Dakota (NA), 141 North Main Avenue, Sioux Falls, SD 57117; United Mortgage Corporation, 8300 Norman Center Drive, Suite 1000, Bloomington, MN 55437; Michael Iannacone, Trustee, 8687 Eagle Pointe Blvd, Lake Elmo, MN 55042 WHEREAS, Division of Code Enforcement has served in accordance with the provisions of Chapter 45 of the Saint Paul Legislative Code an order identified as an"Order to Abate Nuisance Building(s)" dated October 9, 2003; and WHEREAS, this order informed the then known interested or responsible parties that the shucture located on the Subject Property is a nuisance building(s) pursuant to Chapter 45; and WHEREAS, this order informed the interested or responsible parties that they must repair ar demolish the structure located on the Subject Property by November 10, 2003; and WHEREAS, the enforcement officer has posted a placard on the Subject Property declaring this building(s) to constitute a nuisance condition; subject to demolition; and WHEREAS, this nuisance condition has not been corrected and Division of Code Enforcement requested that the City Clerk schedule public hearings before the Legislative Hearing Officer of the City Council and the Saint Paul City Council; and WHEREAS, the interested and responsible parties have been served notice in accordance with the provisions of Chapter 45 of the Saint Paul Legislative Code, of the time, date, place and purpose of the public hearings; and AA-ADA-EEO Employer �� 0 3�<<<�f 1 WHEREAS, a hearing was held before the Legislarive Hearing Officer of the Saint Paul City 2 Council on Tuesday, December 9, 2003 to hear testimony and evidence, and after receiving testimony and 3 evidence, made the recommendation to approve the request to order the interested or responsibie parties to 4 make the Subject Property safe and not detrimental to the public peace, health, safety and welfare and 5 remove its blighting influence on the community by rehabilitating this structure in accordance with all 6 applicable codes and ordinances, or in the alternarive by demolishing and removing the structure in 7 accordance with all applicable codes and ordinances. The rehabilitation or demolition of the shucture to be 8 completed within �� days after the date of the Council Hearing; and q /PD 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 WHEREAS, a hearing was held before the Saint Paul City Council on Wednesday, December 17, 2003 and the testimony and evidence including the acrion taken by the Legislative Hearing Officer was considered by the Council; now therefore BE I'I' RESOLVED, that based upon the testimony and evidence presented at the above referenced public hearings, the Saint Paul City Council hereby adopts the following Findings and Order concerning the Subject Property at 1863 Iglehart Avenue: That the Subject Property comprises a nuisance condition as defined in Saint Paul Legislative Code, Chapter 45. 2. 3. 4. 5. 6. F� That the costs of demolition and removal of this building(s) is estimated to exceed three thousand dollars ($3,000.00). That there now exists and has existed multiple Housing or Building code violations at the Subject Property. That an Order to Abate Nuisance Building(s) was sent to the then known responsible parties to correct the deficiencies or to demolish and remove the building(s). That the deficiencies causing this nuisance condition have not been corrected. That Division of Code Enforcement has posted a placard on the Subject Property which declues it to be a nuisance condition subj ect to demolition. That this building has been routinely monitared by the Citizen Service Offices, Division of Code Enforcement, Vacant/Nuisance Buildings. That the known interested parties and owners are as previously stated in this resolution and that the notification requirements of Chapter 45 have been fulfilled. ORDER The Saint Paul City Council hereby makes the following order: The above referenced interested or responsible parties shall make the Subject Properiy safe and not detrimental to the public peace, health, safety and welfare and remove its blighting influence on the community by rehabilitating this structure and correcting all deficiencies as prescribed in the above referenced Order to Abate Nuisance Building(s) in accordance with all applicable codes and ordinances, or in the alternative by demolishing and removing the structure in accordance with all applicable codes and ordinances. The rehabilitation or demolition and removal of the structure must be completed within.fi&ee".�}days after the date of the Council Hearing. /�D AA-ADA-EEO Employer _ �/} 1„Ar� D3—lit� 1 2 3 4 5 6 7 8 9 10 11 12 2. If the above corrective action is not completed within this period of time the Citizen Service Office, Division of Code Enforcement is hereby authorized to take whatever steps are necessary to demolish and remove this structure, fill the site and chazge the costs incurred against the Subject Property pursuant to the provisions of Chapter 45 of the Saint Paul Legislative Code. 3. In the event the building is to be demolished and removed by the City of Saint Paul, all personal property or fixtures of any kind which interfere with the demolition and removal shall be removed from the property by the responsible parties by the end of this time period. If all personal property is not removed, it shall be considered to be abandoned and the City of Saint Paul shall remove and dispose of such properiy as provided by law. 4. It is further ordered, that a copy of this resolution be mailed to the owners and interested parties in accordance with Chapter 45 of the Saint Paul Legislative Code. Requested by Department of: Benanav Blakev Bostrom Coleman Harris Lantrv Yeas I Navs IAbsent � Citizen Service Office; Code Enforcement ✓ � ✓ By: � � ) ✓ ✓ ✓ I �° �'�e^I ✓ I I I � O � Adopted by Council: Date a Qp3 Adoption Certified by Council Secretary By: Appr By Form Approved by City Attorney B �fn�� , Approv�c�y Mayor for Submission to� �1.��.�� AA-ADA-EEO Employer � b3-iir � Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet � C�J Departmentlo�ce/council: Date Initiated: cs ��5�� 14NOV-03 Green Sheet NO: 3007796 ConWct Person & Phone: Andy Dawkins 266-1927 Must Be on Council Agenda by (Date): � 17-DEC-03 A � r � Deoartment Sent To Person InitiallDate 0 ilizen Services - Assign 1 itizenServices 'N De arLmentDirector � Number Z ; Attorne �� For ROUti�g 3 or's Office Ma ar/Assistant Order 4 uncil 5 i Clerk Ci Clerk Total # of Signature Pages �(Clip NI Locations for Signature) Action Requested: City Council to pass tlris resolurion wlrich will order the owner(s) to remove or repair the referenced building(s). If the owner fails to comply with the resolurion, The Citizen Service Office, Division of Code Enforcement is ordered to remove the building. The subject property is located at 1863 Iglehart Avenue. Recommendations: Approve (A) or Rejed (R): Planning Commission CIB Committee Civil Service Commission 1. Has this person/firm ever worked under a contract for this department? Yes No 2. Has this person/firtn ever been a city employee? Yes No 3. Does this personffirm possess a skill not normally possessed by any current city employee? Yes No Ezplain all yes answers on separate sheet and attach to green sheet Initiating Problem, Issues, Opportunity (Who, What, When, Where, Why): , Tlus building(s) is a nuisance building(s) as defined in Chapter 45 and a vacant building as defined in Chapter 43 of the Saint Paul Legislarive Code. The owners, interested parties and responsible parties lmown to the Enforcement Officer were given an order to repau or remove the building at 1863 Iglehart Avenue by November 10, 2003, and have failed to comply with those orders. Advantages If Approved: The City will eliminate a nuisance. Disadvantages If Approved; The City will spend funds to wreck and remove this building(s). These costs will be assessed to the property, collected as a special assessment against the properry taaces. Disadvantages If Not Approved: A nuisance condition will rexnain unabated in the City. This building(s) will continue to blight the community. ��t"�°°s� °�?+�n.�:?,r�.h s°Oe!�§,,.�' r ToWI Amount of ' #m $r �. ,�"„�' - Transaction: 9000 Cost/Revenue Budgeted: y Funding Source: 001-00258 Financial I nformation: (Explain) nct�vny Number: Summary Nuisance Abatement � . �: r ._ . f ��. . --' , . ,_.,.._�-� u�� k .' , ., . , , . . _ . � 63 �r1r� REPORT Date: December 9, 2003 Time: 10:00 a.m. Place: Room 330 City Hall 15 West Kellogg Boulevazd LEGISLATIVE HEARING FOR ORDERS TO REMOVE/REPAIR, CONDEMNATIONS, AND ABATEMENT ASSESSMENTS Marcia Moermond Legislative Hearing Officer Resolution ordering the owner to remove or repair the building(s) at 1863 Iglehart Avenue. If the owner fails to comply with the resolution, Code Enforcement is ordered to remove the building(s). Legislative Hearing Officer recommends granring the owner 180 days to complete the rehabilitation of the property provided that the following is done by noon of December 17, 2003: 1) the real estate transaction is completed, 2) the code compliance inspection has been scheduled, and 3) the $2,000 bond is posted. !� CITIZEV SERVICE OFFICE p 3 �' l I T Donald !. Luna, Ciry Cferk DNISION OF PROPERTY CODE ENFORCEMEM Andy Dawkint, Program hfanager �.1� ��' .S�r PL1�.. Nuisance Bu(ldirsg Code Enforcement RandyC.Ke11y,May�or 1600NorthWhiteBearAvenue Te[. 65l-166-l900 SairttPaul, bf.V 55106 Faz: 651-266-t926 November 14, 2003 , 1V'OTICE OF PUBLIC HEARINGS Council President and `__ Members of the City Council � Citizen Service Office, Vacant/Nuisance Buildin�s Enforcement Division has requested the City Council schedule public hearin�s to consider a resolution ordering the repair or removal of the nuisance buildin�(s) located at: 1863 Iglehart Avenue The City Council has scheduled the date o£these hearin�s as follows: Legislative Hearing - Tuesday, December 9, 2003 City Council Hearing - Wednesday, December 17, 2003 The owners and responsible parties of record are: Name and Last Known Address Rae O. Bauer, fka Rae O. Hegdahl 1863 I�lehart Avenue St. Paul, MN 55104 Rae O. Bauer, flca Rae O. Hegdahl 5882 Oxboro Avenue N Oak Park Hei�hts, IvLN 55082 47� Cross Point Parkin� Getz�'iiie.\�� i'.06� �t*�: Bani�*�tc�� D�+_.. Rou�isna iumnicir Bank of America 2383 tiniversin�A� St. Paul, NL�' S5114 _*_�. ss2ny \-_- Interest Fee Owner Fee Owner Ivlortga�e Company \ion��e �arLn�c ,4.4-ADA-EEO Emptoyer 1863I�lehart Avenue November 14, 2003 Page 2 Name and Last Known Address First Bank of South Dakota (NA) 141 North Main Avenue Sious Falls, SD 57117 United Mortga��,Corporation 8300 Norman Center Drive, Suite 1000 Bloomin�ton, MN55437 Michael Iannacone, Trustee 8687 Ea�le Point Blvd Lake Elmo, MN 55042 The IegaI description of this property is: Lot 24, Block 22, Merriam Pazk, Ramsey Co., Minn. 03 Interest Mort�a�e Company Mortgage Company Bankruptcy Trustee Division of Code Enforcement has declared this building(s) to constitute a"nuisance" as defined by Lea slative Code, Chapter 45. Division of Code EnforcemenY has issued an order to the then known responsible parties to eliminate this nuisance condition by correctin� the deficiencies or by razing and removin� this buildin�(s). Inasmuch as this Order to Abate has not been complied �vith the nuisance condition remains unabated, the community continues to suffer the blightin� influence of this property. It is the recommendation of the Division of Code Enforcement that the City Council pass a resolution ordering the responsible parties to either repair, or demolish and remove this building in a timely manner, and failin; that, authorize the Division of Code Enforcement to proceed to demolition and remocal, and io assess the costs incurred a�ainst the real estate as a special assessment to be collected in the same manner as taxes. Sincerely, �� Steve Ma�er VacantBuildinas Supervisor Division of Code Enforcement �.:'.z�� Se:,ic� O�c� ,1�__ ... rr��: Bertr. Buiidino inspection aad 17esi� MeLhan Riley, City Attomeys Office MaryErickson, Assistant Secretary to the Council Laurie Kaplan, PED-Housino Division rU1-ADA-EEO Employer �� o�-�� MINUTES OF THE LEGISLATIVE HEARING ORDERS TO REMOVE/REPAIR, CONDEMNATIONS, AND ABATBMENT ASSESSMENTS Tuesday, December 9, 2003 Room 330 City Hall, 15 Kellogg Boulevazd West Mazcia Moermond, Legislative Hearing Officer The hearing was called to order at 10:02 a.m. Resolution ordering the owner to remove or repair the building(s) at 1863 Iglehart Avenue. If the owner fails to comply with the resolution, Code Enforcement is ordered to remove the building(s). (Steve Magner submitted photographs.) Mazcia Moermond explained that there wiil be a resolution in front of the City Council to remove or repair the building. Normally, she looks for the properiy taxes to be paid in full, for the eode compliance inspection to be conducted, and the vacant building fees to be paid. She is concerned that the City has been to the property to do summaty abatements, which tells her the current owners have not been responsible in maintaining the building; therefore, they would be less responsible for completing a rehabilitation plan. Steve Magner reported this is a three story wood frame duplex with a small wood frame utility shed. According to their files, the building was condemned on May 17, 2002, by the Fire Department. It has been a vacant building since. The current properry owner is listed as a Ray O. Hegdahl per Ramsey County Records. There have been four siumnary abatements issued to remove improperly stored refuse including trailers, fire debris, steel poles, tall grass and weeds, etc. On September 30, 2003, an inspection of the building was conducted, a list of deficiencies which constitute a nuisance condition was developed, and photographs were taken. An order to abate a nuisance building was issued on October 9, 2003, with a compliance date of November 10, 2003. As of this date, the property remains in a condition which comprises a nuisance as defined by the legislative code. The City has had to board this building and secure it against trespass. The vacant building fees have been paid. The real estate taxes are paid in full. Ramsey County Taxarion has placed an estimated mazket value on the land prior to the fire of $28,400; estimated mazket value of $160,100 on the building prior to the fire. As of today, a code compliance inspection has not been applied for nor has a bond been posted with LIEP (License, Inspecfions, Environmental Protection). Code Enforcement estimates the cost to repair this structure is $80,000 to $9Q�00. Their estimated cost of demolition is $8,000 to $9,000. Code Enforcement is seeking a resolution to remove or repair in 15 days as there has been no action from the owner. Mr. Magner went on to say that Matt Kustritz is known to him as a rehabber. He recently rehabilitated a property at 790 Laurel Avenue that was before the Legislafive Hearing Officer less than a year ago in the same or similar condition as 1863 Iglehart. Mr. Kustriz called Mr. Magner to say he wanted to purchase 1863 Iglehart. Mr. Magner told him to show up at this forum, purchase the building, post a$2,000 bond, obtain a code compliance inspection, and present a plan to the Legislative Heazing Officer. This matter also went to bankruptcy court. C��--�� LEGISLATIVE HEARING MIlVUTES OF DECEMBER 9, 2003 Page 2 Mark and Bonnie Eldridge, 1869 Iglehart Avenue, appeared. Mr. Eldridge stated the former owners were misleading the City about the status of the property. The City did not know abouT the bankruptcy until this snmmer. The bankruptcy trustee made no effort to contact the City. The Eldridges are interested in seeing the house torn down or rebuilt as a singIe family home. If the latter is the case, they would like to see a performance bond posted for a substantial amount of money. They aze tired of living next to a wreck. Mrs. Eldridge stated that they were hopeful it would be torn down. Now that it has been sold, they aze hopeful that it will be fixed up. Also, she has seen a number of houses turned into illegal student housing. Mr. Eldridge added that 1863 Iglehart was previously student housing. The following appeazed: Michael Iannocone, Attorney at Law, 8687 Eagle Point Boulevazd. Lake Elmo; and Matt Kustritz, 500 Grand Hill, Saint Paul. (Michael Iannocone gaue Ms. Moermond a copy of bankruptcy documents. Mr. Kustritz gave Ms. Moermond a copy of the purchase agreement.) Ms. Moermond asked is the purchase agreement between the two of them. It is signed November 26. Mr. Iannocone responded that is right. The agreement is subject to bankruptcy court approval, which was obtained yesterday. There is an addendum that he attached. Normaily when a purchase agreement is signed, the properiy is sold, and it is off the market. That does not happen in a bankniptcy court sa1e. It is not sold until the judge says it is sold. The purchase agreement and the addendum are signed one day, but it is not a deal until the court approves it. The Bauers filed bankniptcy in Febniary 2002, said Mr. Iannocone. At that time, they listed the vatue of this property at $80,000 and mortgages against the building at $80,000. That meant there was no equity in the property. In that case, it originally closed in a"no asset estate" which means there are no assets that can be liquidated and paid over to creditors. The case was closed and Mr. Iannocone did not hear anything about the Bauers unYil about July 2002. He got a call from the insurance company that the house had burned down. The banla�uptcy court file was pulled, The house was assessed for real estate tax purposes at $203,000, not $80,000. They attempted to amend their valuations to show the new value and claim the property as exempt. Mr. Iannacone objected to that proceeding claiming the owners are not entitled to an exemption because they falsified the value. That case was heazd in January 2003, and a decision was rendered in March 2003. In Febniary 2003, the insurance company paid the Bauers almost $375,000 for the damage from the fire. The March decision was appealed to the baulnuptcy appellate panel for the 8t circuit. It was argued in Augezst. They rendered their decision in September, and the mandate went back to the banla�uptcy court in October. Mr. Iannacone then had control of the properry for about two months. VJhen the mandate come down, it was a fmal deal. Mr. Iannacone received inquiry from the neighbors to buy the properry. They went to banlauptcy court on five days notice. The motion was filed on Thursday and the order was entered yesterday. They haue obtained approval to sell it to Mr. Kustritz's company. o�-� �� LEGISLATIVE HEARING MINUTES OF DECEMBER 9, 2003 Page 3 Mr. Iannacone went on to say that if Mr. Kustritz is going to pay Mr. Iannacone $100,000, he must be serious about going forwazd with this. Mr. Iannacone requests the Council give 180 days for the property to be rehabilitated and put back on the taac rolls. This estate has virtually no money. In addition to the insurance money he is now suing to get back, the debtors also mischaracterized a retirement plan and have walked off with another $200,000. As an aside, Mr. Iannacone is aware that hazardous buildings aze a problem in the City. He is embarrassed that he is associaled with this, but he was associated by court appointment and not as a volunteer. Matt Kustritz stated his plans are to close with Mr. Iannacone on December 15. Upon closing, Mr. Kustritz will do the following: contact Jim Seeger (License, Inspections, Environmental Protection) who is in charge of code compliance inspections, post a$2,000 bond, and obtain permits to begin work. His plan is to rehabilitate the structure as a single family and sell it to an owner/occupant. With the money he is going to put into the house, the price would be so high that an investor would not buy it to use as student housing. Mr. Eldridge asked does he own rental units. Mr. Kustritz responded he does and he also rehabilitates structures like this one, He rehabilitated a structure at 790 Laurel that had an explosion. It was also a nuisance building that was severely damaged by fire. His company, EMK Development, purchased it for $80,000. It was sold recendy for $379,000. Mrs. Eldridge asked does he intend to change the zoning. Mr. Kustritz responded it was originally a single family dwelling and later converted to a duplex or triplex. He thinks that when Mr. Seeger does his code compliance inspection, he will determine that it is a single family dwelling. Mr. Magner responded if the zoning allows for a multi-family dwelling, once he obtains the code compliance as a single family, he has to rehabilitate the building as a single family, and he will be issued a code compliance certificate as a single family dwelling. It is unlikely a buyer would change the zoning after purchasing it. Mr. Kustritz stated he will contact Mr. Seeger who will bring out four inspectors from mechanical, plumbing, electrical, and general building. Ms. Moermond responded these are usually exhaustive lists that need to be done before the building is occupied. Ms. Moermond stated she would like to see the transaction completed, the code compliance inspection applied for, and the $2,000 bond posted. Ms. Moermond stated she is looking at four suminary abatement notices that haue been issued. Whether or not there was money in the estate to do rehabilitation, there is an expectation of the owners or trustees to take care of the yazd. Mr. Eldridge responded that he has done a lot of mowing. Ms. Moermond stated she would like this concluded by noon of December 17. Mr. Magner stated he would like to be updated for the closing. He will update the owner on December 17 a8er noon. o�-�� LEGISLATIVE HEARING MINiJTES OF DECEMBER 9, 2003 Page 4 Marcia Moermond recommends granting the owner 180 days to complete the rehabilitation of the property provided that the following is done by noon of December 17, 2003: 1) the real estate transaction is completed, 2) the code compliance inspection has been scheduled, and 3) the $2,000 bond is posted. The hearing was adjourned at 1039 a.m. rrn i� A �� . ': � � 1 f � � � � �� y : " " � � "�= �\ �• . ' � , ' . .� � � , � � , t . . � � . � �I . . �� i.y __ � s-:' — - ' L.'i-- ' " " _ . f . / ��`.+-,: e�r c � • f� y( ,. . � . . 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