Background: The Hennepin Healthcare Whittier Clinic (“Clinic”) is located at 2810 Nicollet in Minneapolis. Hennepin Healthcare plans to apply for a federal grant from U.S. Department of Health and Human Services, Health Resources & Services Administration (HRSA) to create two new exam rooms at the Clinic.

The grant requires that the Landlord (Hennepin County) amend the Ground Lease and Sublease Agreement to include the following provisions:

1.Tenant agrees not to sublease, assign, or otherwise transfer the property, or use the property for a non-grant related purpose without the written approval from HRSA at any time during the term of the Lease, whether or not Grant support has ended.

2. Landlord will inform HRSA of any default by the Tenant under the Lease.

3. HRSA shall have sixty (60) days from the date of receipt of the Landlord’s notice of default in which to attempt to eliminate the default, and that the Landlord will delay exercising remedies until the end of the sixty (60) day period.

4. HRSA may intervene to ensure that the default is eliminated by the Tenant or another recipient named by HRSA.

5. The Landlord shall accept payment of money or performance of any other obligation by the HRSA’s designee, for the Tenant, as if such payment of money or performance had been made by the Tenant.

6. In the event that the Tenant defaults, the Grant is terminated, or the Tenant vacates the property before the end of the Lease term, HRSA shall have the right to designate a replacement for the Tenant for the balance of the Lease term, subject to approval by the Landlord, which will not be withheld except for good reason.

Additionally, the Landlord may be required to sign other documents related to the real estate to in order to protect the federal investment in the property. These documents include a Landlord Letter of Consent and, if the project costs exceed $500,000, a Notice of Federal Interest which would be recorded in the public land records.  At this point, the project is not expected to exceed the $500,000 threshold.

Current Request: Delegate authority to the County Administrator to amend the Ground Lease and Sublease Agreement between Hennepin County and Hennepin Healthcare System, Inc. and sign related documents, including, but not limited to, a Landlord Letter of Consent and a Notice of Federal Interest, required for the U.S. Department of Health and Human Services, Health Resources & Services Administration (HRSA) grant.

Impact Outcomes: The grant funds would allow Hennepin Healthcare to create two new exam rooms at the Whittier Clinic to increase the number of patients served at the facility.