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HomeMy WebLinkAbout2015-05-28 ResolutionRESOLUTION NO. 15-170 RESOLUTION OF INTENT TO CONSIDER A PROPOSED DEVELOPMENT AGREEMENT WITH THE CHAUNCEY, L.L.C., WHICH INCLUDES DESCRIBED THEREIN, AND AND PROVIDING FOR THEREOF THE TRANSFER OF LAND SETTING A PUBLIC HEARING PUBLICATION OF NOTICE WHEREAS, on October 2, 1969, the Iowa City City Council adopted Resolution No. 2157 approving the City -University Project I Urban Renewal Plan (Project No. IA R-14), which plan has been modified and amended from time to time (said plan, as amended, is hereinafter referred to as the "Plan") for the City -University Urban Renewal Area (the "Urban Renewal Area" or "Area") described therein, which is on file in the office of the Recorder of Johnson County; and, WHEREAS, among the Plan objectives for the Area are objectives to create residential living spaces for young professionals and other members of the "creative class" by offering a variety of housing options, including high-density, affordable urban apartments; to create a more livable community by supporting affordable, energy-efficient housing and the suitable reuse of idle or underutilized land; to create a vibrant, mixed-use, pedestrian -oriented neighborhood; and to increase the amount of office space available in the Area by promoting mixed-use developments that contain quality office space; and WHEREAS, following a competitive request for proposal process, the City received a proposal from The Chauncey, L.L.C. (the "Developer"), in the form of a proposed Development Agreement (the "Agreement") by and between the City and the Developer, pursuant to which, among other things, the Developer would agree to invest $49,000,000 in development costs to construct certain Minimum Improvements, as defined in the Agreement, on certain real property located within the City -University Urban Renewal Area, located at the northeast intersection of College and Gilbert Streets, as legally described in the Agreement, an area that is currently underutilized as an electrical substation, surface parking, and police storage; and WHEREAS, the Developer proposes to construct a 15 -story mixed use building with Class A office space, a hotel, a bowling alley, two movie theatres, residential condominiums, and upgrades to the Chauncey Swan Park, together with related site improvements, all designed and constructed to at least LEED Silver standards, as detailed in the proposed Agreement; and WHEREAS, the City Council has adopted certain Economic Development Policies intended to a) attract new residential and commercial development, b) retain the City's existing businesses, and c) encourage business expansion, in order to a) increase economic activity, b) create jobs; c) lower unemployment, d) increase wages; e) increase property values, f) increase tax revenues, g) increase ownership and entrepreneurial opportunities, and h) revitalize underutilized or blighted areas; and WHEREAS, pursuant to said Policies, the City's consultant made a financial analysis of the proposed Development Agreement, which analysis included an examination of all financing sources for the project, the project costs, with scrutiny of the Developer's return based largely on Developer equity and the maximization of project debt; and WHEREAS, the Developer equity in the project, not including debt, is equal to or greater than the public financing requested; and WHEREAS, in exchange for construction of the Minimum Improvements and the creation of a $30,128,234 minimum assessment value on the project once complete, the City proposes to convey land to the Developer for the appraised value of $1,870,000, to convey certain easement rights to the Developer for the appraised value of $10 per square foot, and to make certain contributions to the project, including the acquisition of five one -bedroom condominium units from the Developer for $1,000,000 once the project is complete, which the City will own and maintain for affordable housing, and to make a $14,187,250 economic development construction grant, paid through the use of tax increment financing and reinvestment of the proceeds from the Property; and WHEREAS, the City is willing to convey to the Developer that portion of the Property it currently owns and grant additional easement rights described therein at fair market value as determined by City's appraisal without consideration of the use restrictions, subject to the use limitations provided for in the proposed Development Agreement, and certain restrictions, covenants, conditions and obligations assumed by the Redeveloper pursuant to this Agreement, all of which limit the fair market value of the Property; and WHEREAS, the Project will generate, when complete, a minimum of $30,128,234 of new tax base upon which taxes will be paid pursuant to the protected school debt service levy, school physical plant and equipment levy, county debt service levy, city debt service levy, community college debt service levy and school instructional support levy, and upon which the self -supported municipal improvement district taxes will be levied. WHEREAS, Iowa Code Chapters 15A and 403 (the "Urban Renewal Law") authorize cities to make grants for economic development in furtherance of the objectives of an urban renewal project and to appropriate such funds and make such expenditures as may be necessary to carry out the purposes of said Chapter, and to levy taxes and assessments for such purposes; and WHEREAS, the Council has determined that the Agreement is in the best interests of the City and the residents thereof and that the performance by the City of its obligations thereunder is a public undertaking and purpose and in furtherance of the Plan and the Urban Renewal Law and, further, that the Agreement and the City's performance thereunder is in furtherance of appropriate economic development and blight remediation activities and objectives of the City within the meaning of Chapters 15A and 403 of the Iowa Code, taking into account the factors set forth therein; and 2 WHEREAS, neither the Urban Renewal Law nor any other Code provision sets forth any procedural action required to be taken before said economic development activities can occur under the Agreement, and pursuant to Section 364.6 of the City Code of Iowa, it is deemed sufficient if the action hereinafter described be taken and the City Clerk publish notice of the proposal and of the time and place of the meeting at which the Council proposes to take action thereon and to receive oral and/or written objections from any resident or property owner of said City to such action. NOW THEREFORE, BE IT RESOLVED, BY THE CITY COUNCIL OF THE CITY OF IOWA CITY, IN THE STATE OF IOWA: Section 1. The City Council does hereby declare its intent to consider the proposed Development Agreement with the Chauncey, L.L.C., which agreement includes the conveyance of Lot 5, the west 30' of Lot 6, and the west 160' of the alley, all in Block 43, Original Town, Iowa City, Iowa, to The Chauncey, L.L.C. Section 2. A public hearing on said proposal should be and is hereby set for June 8, 2015 at 7:00 P.M. in Emma J. Harvat Hall at City Hall, 410 E. Washington Street, Iowa City, Iowa, or, if said meeting is cancelled, at the next meeting of the City Council thereafter as posted by the City Clerk. Section 3. That the City Clerk is hereby directed to cause at least one publication to be made of a notice of said meeting, in a legal newspaper, printed wholly in the English language, published at least once weekly, and having general circulation in said City, said publication to be not less than four (4) clear days nor more than twenty (20) days before the date of said public meeting. Section 4. The notice of the proposed action shall be in substantially the following form: NOTICE OF PUBLIC HEARING OF THE IOWA CITY CITY COUNCIL ON THE MATTER OF THE PROPOSAL TO ENTER INTO A DEVELOPMENT AGREEMENT, WHICH INCLUDES THE CONVEYANCE OF LAND, WITH THE CHAUNCEY, L.L.C., AND THE HEARING THEREON PUBLIC NOTICE is hereby given that the Iowa City City Council will hold a public hearing on June 8, 2015, at 7:00 p.m. in Emma Harvat Hall, at City Hall, 410 E. Washington Street, Iowa City, Iowa, or, if said meeting is cancelled, at the next meeting of the City Council thereafter as posted by the City Clerk, at which meeting the Council proposes to take action on the proposal to enter into a Development Agreement (the "Agreement") with The Chauncey, L.L.C. (the "Developer"). The Agreement would obligate the Developer to invest $49,000,000 in development costs toward the construction of certain Minimum Improvements as defined in the Agreement on certain real property located within the City -University Urban Renewal Area as defined and legally described in the Development Agreement. Said land is currently owned, in part, by the City of Iowa City and would be conveyed to The Chauncey, L.L.C. pursuant to said K, Development Agreement. The project is expected to consist of the construction of a 15 -story mixed use building with Class A office space, a hotel, a bowling alley, two movie theatres, caf6, gallery space, residential condominiums, and upgrades to the Chauncey Swan Park, together with related site improvements, all designed and constructed to at least LEED Silver standards, as detailed in the proposed Development Agreement. In exchange for construction of the Minimum Improvements and the creation of a $30,128,234 minimum assessment value on the project once complete, the City proposes to convey land to the Developer for the appraised value of $1,870,000, to convey certain easement rights to the Developer for the appraised value of $10 per square foot, and to make certain contributions to the project, including the acquisition of five one -bedroom condominium units from the Developer for $1,000,000, once the project is complete, which the City will own and maintain for affordable housing, and to make a $14,187,250 economic development construction grant, paid through the use of tax increment financing and reinvestment of the proceeds from the Property. A copy of the Agreement is on file for public inspection during regular business hours in the office of the City Clerk, City Hall, City of Iowa City, Iowa. At the above meeting the Council shall receive oral or written comments from any resident or property owner of said City, to the proposal to enter into the Agreement with the Developer. After all comments have been received and considered, the Council will at this meeting or at any adjournment thereof, take additional action on the proposal or will abandon the proposal to authorize said Agreement. This notice is given by order of the City Council of the City of Iowa City, Iowa, as provided by Section 364.6 of the City Code of Iowa. Dated this day of 92015. City Clerk, City of Iowa City, Iowa (End of Notice) PASSED AND APPROVED this 28th day of May , 2015. Mayor ATTEST: City Clerk Approved by: City Attorney's Office S/a 7b 4 Council Member Mims introduced the following Resolution entitled "RESOLUTION FIXING DATE FOR A MEETING ON THE PROPOSITION OF THE ISSUANCE OF NOT TO EXCEED $14,200,000 URBAN RENEWAL TAX INCREMENT REVENUE BONDS, SERIES 2015B, OF THE CITY OF IOWA CITY, STATE OF IOWA, AND PROVIDING FOR PUBLICATION OF NOTICE THEREOF," and moved that the same be adopted. Council Member Botchway seconded the motion to adopt. The roll was called and the vote was, AYES: Botchway, Dickens, Dobyns Hayek, Mims, Throgmorton NAYS: None ABSENT: Payne Whereupon, the Mayor declared the resolution duly adopted as follows: Resolution No 15-171 RESOLUTION FIXING DATE FOR A MEETING ON THE PROPOSITION OF THE ISSUANCE OF NOT TO EXCEED $14,200,000 URBAN RENEWAL TAX INCREMENT REVENUE BONDS, SERIES 2415B, OF THE CITY OF IOWA CITY, STATE OF IOWA AND PROVIDING FOR PUBLICATION OF NOTICE THEREOF WHEREAS, the City of Iowa City, State of Iowa, is in need of funds to carry out the purpose hereinafter described; and, it is deemed necessary and advisable that the City should issue Urban Renewal Tax Increment Revenue Bonds, Series 2015B, to the amount of not to exceed $14,200,000, as authorized by Sections 362.3 and 403.9, of the City Code of Iowa, for the purpose of providing funds to pay costs thereof; and WHEREAS, before the bonds may be issued, it is necessary to comply with the provisions of the Code, and to publish a notice of the proposal to issue such bonds and of the time and place of the meeting at which it is proposed to take action for the issuance of the bonds and to receive oral and/or written objections from any resident or property owner of the City to such action; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA CITY, STATE OF IOWA: Section 1. That this governing body meet in the Emma J. Harvat Hall, City Hall, 410 E. Washington, Iowa City, Iowa, at 7:00 o'clock P.M., on the 8th day of June, 2015, for the purpose of taking action on the matter of the issuance of not to exceed $14,200,000 Urban Renewal Tax Increment Revenue Bonds, Series 2015B, of the City, the proceeds of which bonds will be used -2- to provide funds to pay costs of aiding in the planning, undertaking, and carrying out of an urban renewal project for the redevelopment of real property, including one or more grants to a redeveloper, The Chauncey, L.L.C., in connection with the construction of Class A office space, workforce housing, a hotel, a bowling alley and movie theatre at the northeast corner of College and Gilbert Streets. Section 2. That the Clerk is hereby directed to cause at least one publication to be made of a notice of such meeting, in a legal newspaper, printed wholly in the English language, published at least once weekly, and having general circulation in the City, such publication to be not less than four clear days nor more than twenty days before the date of the public meeting on the issuance of the bonds. Section 3. The notice of the proposed action to issue the bonds shall be in substantially the following form: -3- Publish 6/1 NOTICE OF MEETING OF THE CITY COUNCIL OF THE CITY OF IOWA CITY, STATE OF IOWA, ON THE MATTER OF THE PROPOSED ISSUANCE OF NOT TO EXCEED $14,200,000 URBAN RENEWAL TAX INCREMENT REVENUE BONDS, SERIES 2015B OF THE CITY OF IOWA CITY, AND THE HEARING ON THE ISSUANCE THEREOF PUBLIC NOTICE is hereby given that the City Council of the City of Iowa City, State of Iowa, will hold a public hearing on the 8th day of June, 2015, at 7:00 o'clock P.M., in the Emma J. Harvat Hall, City Hall, 410 E. Washington, Iowa City, Iowa, at which meeting the City Council proposes to take additional action for the issuance of not to exceed $14,200,000 Urban Renewal Tax Increment Revenue Bonds, Series 2015B, of the City. The bonds will not constitute general obligations or be payable in any manner by taxation, but will be payable from and secured by the net revenues of the City -University Project 1 Urban Renewal Area under Section 403.19(2) of the Code of Iowa. The bonds are proposed to be issued for the purpose of paying costs of aiding in the planning, undertaking, and carrying out of an urban renewal project for the redevelopment of real property, including one or more grants to a redeveloper, The Chauncey, L.L.C., in connection with the construction of Class A office space, workforce housing, a hotel, a bowling alley and movie theatre at the northeast corner of College and Gilbert Streets. At the above meeting oral or written objections from any resident or property owner of the City to the above action shall be received. After all objections have been received and considered, the Council will at the meeting or at any adjournment thereof, take additional action for the issuance of the bonds or will abandon the proposal to issue the bonds. This notice is given by order of the governing body as provided by Sections 362.3 and 403.9 of the City Code of Iowa. Dated this 1 st day of June, 2015. Marian K. Karr City Clerk, City of Iowa City, State of Iowa (End of Notice) NOTICE OF MEETING OF THE CITY CO CIL OF THE CITY OF IOWA CITY, STATE OF IOWA, JDN THE MATTER OF THE PROPOSED ISSUANCE OF/NOTO EXCEED $14,200,000 URBAN RENEWAL TAREMENT REVENUE BONDS, SERIES 2015B E CITY OF IOWA CITY, A14D THE HEARING ON THANCE THEREOF PUBLIC NOTIC is hereby given that the ity Council of the City of Iowa City, State of Iowa, will hold a public h ng on the 8th day of une, 2015, at 7:00 o'clock P.M., in the Emma J. Harvat Hall, City Hall, 4 0 E. Washington, Io a City, Iowa, at which meeting the City Council proposes to take ad itional action for t e issuance of not to exceed $14,200,000 Urban Renewal Tax Increment Revenue Bonds, Seri s 2015B, of the City. The bonds will not constitute general obligations kir be payable ' any manner by taxation, but will be payable from and secured by the net revenues of the City niversity Project 1 Urban Renewal Area under Section 403.19(2) of the Code of paying costs of aiding in the plar for the redevelopment of real prc Chauncey, L.L.C., in connection housing, a hotel, a bowling alley Streets. Ke bonds are proposed to be issued for the purpose of lertaking, and carrying out of an urban renewal project Auding one or more grants to a redeveloper, The construction of Class A office space, workforce ie theatre at the northeast corner of College and Gilbert At the above meeting ori or wri n objections from any resident or property owner of the City to the above action shall be rec I v d. After all objections have been received and considered, the Council will at the meeting at any adjournment thereof, take additional action for the issuance of the bonds or will abandon he proposal to issue the bonds. This notice is given by order of the gov ing body as provided by Sections 362.3 and 403.9 of the City Code Of Iowa. Dated this / day of City (End of Notice) -4- 2015. City of Iowa City, State of Iowa PASSED AND APPROVED this 28th day of May, 2015. ATTEST: City ttak Mayor WE