HomeMy WebLinkAbout2015-03-23 ResolutionPrepared by: Marian K. Karr, 410 E. Washington St., Iowa City, IA 52240 (319) 356-5043
RESOLUTION NO. 15-79
RESOLUTION TO ISSUE DANCING PERMIT
BE IT RESOLVED BY THE CITY COUNCIL OF IOWA CITY, IOWA, that a Dancing
Permit as provided by law is hereby granted to the following named person and at the
following described locations upon his/her filing an application, having endorsed thereon
the certificates of the proper city officials as to having complied with all regulations and
ordinances, having a valid beer, liquor, or wine license/permit, to wit:
Caliente Night Club, Inc. — 171 Hwy 1 West
Passed and approved this 23rd day of March
ATTEST: Aait-- '
CITY CLERK
MAYOR
Approved by
20 15
City Attorney's Office
It was moved by Dickens and seconded by Payne the
Resolution be adopted, and upon roll call there were:
AYES: NAYS: ABSENT:
x Botchway
x Dickens
x Dobyns
x Hayek
x Mims
x Payne
x Throgmorton
3723
3d(1)
Prepared by: Dave Panos, 410 E. Washington St., Iowa City, IA 52240 (319)356-5145
RESOLUTION NO. 15-80
RESOLUTION AWARDING CONTRACT AND AUTHORIZING THE MAYOR TO
SIGN AND THE CITY CLERK TO ATTEST A CONTRACT FOR
CONSTRUCTION OF THE SYCAMORE STREET - CITY LIMITS TO SOUTH
GILBERT STREET, PHASE 1 PROJECT.
WHEREAS, Metro Pavers, Inc. of Iowa City, Iowa has submitted the lowest responsible bid of
$2,471,978.89 for construction of the above-named project; and
WHEREAS, the bid includes the Base bid and Alternate B; and
WHEREAS, funds for this project are available in the Sycamore Street- City Limits to S. Gilbert St
account # S3931.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA
CITY, IOWA, THAT:
The contract for the construction of the above-named project is hereby awarded to Metro
Pavers, Inc. subject to the condition that awardee secure adequate performance and
payment bond, insurance certificates, and contract compliance program statements.
2. The Mayor is hereby authorized to sign and the City Clerk to attest the contract for
construction of the above-named project, subject to the condition that awardee secure
adequate performance and payment bond, insurance certificates, and contract compliance
program statements.
3. The City Engineer is authorized to execute change orders as they may become necessary
in the construction of the above-named project.
Passed and approved this 23rd day of March , 20 15
MAYOR
ATTEST:
CITY CLERK
Appro by
City A orney's Office_ - 1
It was moved by Dickens and seconded by Payne the Resolution be
adopted, and upon roll call there were:
AYES: NAYS:
X
X
X
X
X
X
X
ABSENT:
Champion
Dickens
Dobyns
Hayek
Mims
Payne
Throgmorton
NOTICE TO BIDDERS
SYCAMORE STREET IMPROVEMENTS,
CITY LIMITS TO SOUTH GILBERT STREET,
PHASE I,
Sealed proposals will be received by the City
Clerk of the City of Iowa City, Iowa, until 11 A.M.
on the 13th day of February, 2015. Sealed
proposals will be opened immediately thereafter
by the City Engineer or designee. Bids submitted
by fax machine shall not be deemed a "sealed
bid" for purposes of this Project. Proposals
received after this deadline will be returned to the
bidder unopened. Proposals will be acted upon
by the City Council at a meeting to be held in the
Emma J. Harvat Hall at 7:00 P.M. on the 23rd day
of February, 2015, or at special meeting called for
that purpose.
The Project will involve the following:
Excavation of 25,400 cubic yards of Class 10
fill; installation of 3700 feet of storm sewer and
associated structures; installation of 460 feet
of water main with associated valves, fittings
and fire hydrants; paving 15,000 square yards
of either PCC or HMA pavement, 400 tons of
HMA, and 4,500 square yards of sidewalk; as
well as associated clearing and grubbing, site
work, grading, and associated construction
activities.
All work is to be done in strict compliance with
the plans and specifications prepared by McClure
Engineering Company, of North Liberty, Iowa,
which have heretofore been approved by the City
Council, and are on file for public examination in
the Office of the City Clerk.
Each proposal shall be completed on a form
furnished by the City and must be accompanied
by two sealed envelopes, separate from the one
containing the proposal: one including a bid bond
executed by a corporation authorized to contract
as a surety in the State of Iowa, in the sum of 10%
of the bid, and another envelope including a
completed Resident Bidder Form. The bid security
shall be made payable to the TREASURER OF
THE CITY OF IOWA CITY, IOWA, and shall be
forfeited to the City of Iowa City in the event the
successful bidder fails to enter into a contract
within ten (10) calendar days of the City Council's
award of the contract and post bond satisfactory
to the City ensuring the faithful performance of the
contract and maintenance of said Project, if
required, pursuant to the provisions of this notice
and the other contract documents. Bid bonds of
the lowest two or more bidders may be retained
for a period of not to exceed fifteen (15) calendar
days following award of the contract, or until rejec-
tion is made. Other bid bonds will be returned
AF -1
3 I g-3
after the canvass and tabulation of bids is
completed and reported to the City Council.
The successful bidder will be required to furnish
a bond in an amount equal to one hundred
percent (100%) of the contract price, said bond to
be issued by a responsible surety approved by the
City, and shall guarantee the prompt payment of
all materials and labor, and also protect and save
harmless the City from all claims and damages of
any kind caused directly or indirectly by the
operation of the contract, and shall also guarantee
the maintenance of the improvement for a period
of five (5) year(s) from and after its completion
and formal acceptance by the City Council.
The following limitations shall apply to this
Project:
Specified Completion Dates:
Stage 1 - July 24, 2015
Incentive/Disincentive: $1,200 per calendar day
Stages 2 & 3 - November 30, 2015
Incentive/Disincentive: $750 per calendar day
The plans, specifications and proposed contract
documents may be examined at the office of the
City Clerk. Copies of said plans and specifications
and form of proposal blanks may be secured at
the Office of McClure Engineering Company,
1740 Lininger Lane, North Liberty, Iowa, 52317 by
bona fide bidders. The request shall be
accompanied by a certified check (made payable
to McClure Engineering Company) in the amount
of One Hundred and Fifty Dollars ($150.00) for 11
by 17 -inch Drawings. Payment will be refunded if
the Drawings and Documents are 1) returned
within fourteen (14) days after the Award of the
Project and 2) the Drawings and Documents are
in a reusable condition. If they are not returned, or
returned past the deadline, or are not in a
reusable condition as judged by the Engineer, the
deposit shall be forfeited.
Prospective bidders are advised that the City of
Iowa City desires to employ minority contractors
and subcontractors on City projects. A listing of
minority contractors can be obtained from the
Iowa Department of Inspections and Appeals at
(515) 281-5796 and the Iowa Department of
Transportation Contracts Office at (515) 239-
1422.
Bidders shall list on the Form of Proposal the
names of persons, firms, companies or other
parties with whom the bidder intends to subcon-
tract. This list shall include the type of work and
approximate subcontract amount(s).
The Contractor awarded the contract shall
submit a list on the Form of Agreement of the
proposed subcontractors, together with quantities,
AF -2
unit prices and extended dollar amounts.
By virtue of statutory authority, preference must
be given to products and provisions grown and
coal produced within the State of Iowa, and to
Iowa domestic labor, to the extent lawfully re-
quired under Iowa Statutes. The Iowa reciprocal
resident bidder preference law applies to this
Project.
The City reserves the right to reject any or all
proposals, and also reserves the right to waive
technicalities and irregularities.
Published upon order of the City Council of Iowa
City, Iowa.
MARIAN K. KARR, CITY CLERK
AF -3
Prepared by: Kent Ralston, Transportation Planner, 410 E. Washington St., Iowa City, IA 52240; (319) 356-5253
RESOLUTION NO. 15-81
RESOLUTION ADOPTING A COMPLETE STREETS POLICY FOR THE CITY
OF IOWA CITY AND RESCINDING RESOLUTION NO. 07-199.
WHEREAS, the City of Iowa City is committed to creating street corridors that accommodate all
users and modes of transportation; and
WHEREAS, adequate pedestrian, bicycle, public transit, and motorized vehicle facilities will be
implemented through subdivision design standards and public road construction and major
reconstruction projects; and
WHEREAS, the City expects to realize long-term benefits through implementation of this policy
including improved public health and environmental stewardship, reduced fuel consumption, and
reduced demand for motor vehicle infrastructure; and
WHEREAS, the City desires to become a Blue Zone and recognizes that adopting a revised
Complete Streets Policy aid in achieving this goal; and
WHEREAS, the City Manager may grant exemptions from this Policy only in limited
circumstances for reasons enumerated in the Policy and only when requested by the City
Engineer.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA CITY,
IOWA, THAT:
1. The attached Complete Streets Policy is hereby adopted.
2. Resolution No. 07-199 is hereby rescinded.
Passed and approved this 23rd day of March , 20 15
Appr ved by
ATTEST: 11414,`�C�u✓-ti:vvzr� �e�
CITY RK City Attorney's Office 31-1&15'
Resolution No. 15-81
Page 2
It was moved by Dickens and seconded by Payne the
Resolution be adopted, and upon roll call there were:
AYES: NAYS: ABSENT:
x Botchway
x Dickens
x Dobyns
x Hayek
x Mims
x Payne
x Throgmorton
City of Iowa City, Iowa
Complete Streets Policy
The Vision
The City of Iowa City intends and expects to realize long-term cost savings in improved public
health, reduced fuel consumption, better environmental stewardship, and reduced demand for
motor vehicle infrastructure through the implementation of this Complete Streets Policy.
Complete Streets also contribute to walkable neighborhoods, make the community attractive
to new business and employment, create a sense of community pride, and improve quality -of -
life.
Users and Modes
This policy defines Complete Streets by this outcome: all current and projected users of the
public right-of-way are intended to conveniently reach their destinations via public rights-of-
way, regardless of their chosen mode of transportation for that street or road to be considered
"complete." The design, operation, and maintenance of the City of Iowa City's street network
will create a connected grid of streets accommodating a safe, easily accessible, convenient,
comfortable, and visually appealing manner for all users of all ages and abilities, including
motorists, pedestrians, bicyclists, transit riders, children, senior citizens, persons with
disabilities, freight carriers, emergency responders, and adjacent land users.
Implementation
The City of Iowa City will provide for the needs of all users and abilities in all planning, design,
construction, reconstruction, retrofit, operations, and maintenance activities and products
within the public right-of-way. Each City Department that performs physical improvements in
the right-of-way (streets, sidewalks, landscaping, public utilities, etc.), and private developers
that build infrastructure (streets, public utilities, etc.) for dedication to the City will perform
such work in compliance with this policy. While some streets and roads may require changes to
the right-of-way to better accommodate non -motorized users, many low volume streets and
roads will require only minor changes, such as signage or restriping, or no changes at all (see
Context Sensitive Design, below).
Complete Streets are generally accomplished through adding the following to the public right-
of-way: sidewalks, bike lanes, shared use lanes (sharrows), bus stops, public spaces, improved
way -finding signage, utility corridors, etc. Projects in the right-of-way will incorporate
sidewalks, ADA -compliant curb ramps, ADA -compliant bus stops, bicycle facilities, and any
other reasonably applicable facilities. In particular, capital projects will incorporate complete
street facilities found in City Council adopted plans, including (but not limited to) the
Comprehensive Plan, bicycle and pedestrian plans, ADA Accessibility Transition Plan, and district
plans.
This Complete Streets Policy and associated project documentation applies to any NEW STREET,
RECONSTRUCTED STREET, or STREET MAINTENANCE Within the public right -of -Way (see Definitions
section for CAPITALIZED items) With the following clarifications:
A. NEW STREETS and RECONSTRUCTED STREETS either built by the City or by a developer for City
ownership will implement complete streets — applies in all zoning designations and land
uses.
B. STREET MAINTENANCE projects — whereas all NEW STREET and RECONSTRUCTED STREETS Will
implement multi -modal transportation elements, it is not expected for maintenance and
rehabilitation projects to change geometric features and functional elements to upgrade
to multi -modal transportation elements, although items that fit within the existing
geometrics should be implemented (e.g. re -striping, signage upgrades, sidewalks, etc.).
C. PRIVATE STREETS —sidewalks and ADA -compliant curb ramps are required; otherwise
PRIVATE STREETS are exempt from this policy.
D. Co -Jurisdictional streets —Complete Streets will be considered in conjunction with other
jurisdictions' policies or practices.
E. Existing and new bus stops within a project corridor will be ADA compliant.
Design Criteria and Context Sensitive Design
Each street and right-of-way design should be practically undertaken to complement the
neighborhood in which it exists, while complying with accepted or adopted design standards
and other guidelines based upon resources identifying best practices in urban design and street
design, construction, operations and maintenance when implementing improvements intended
to fulfill this Complete Streets policy. The City will consider all available design options in the
following manuals to ensure access for all modes:
• AASHTO Green Book: A Policy on Geometric Design of Highways and Streets, by the
American Association of State Highway and Transportation Officials
• AASHTO Guide for the Development of Bicycle Facilities, by the American Association of
State Highway and Transportation Officials
• Urban Street Design Guide, by the National Association of City Transportation Officials
• Urban Bikeway Design Guide, by the National Association of City Transportation Officials
• Iowa Statewide Urban Design Standards, by the Institute for Transportation at Iowa
State University
• Iowa City, Iowa City Code, Title 15 —Land Subdivision, by the City of Iowa City
Connectivity and All Agencies
The City of Iowa City will design, operate, and maintain a transportation network that provides
a connected network of facilities accommodating all modes of travel. To achieve a connected
network, the City will foster partnerships with the State of Iowa, the Federal Highway
Administration, the Metropolitan Planning Organization of Johnson County, school district,
Johnson County, surrounding cities, citizens, businesses, interest groups and neighborhoods to
implement the Complete Streets policy throughout Iowa City.
Exceptions
Exceptions to the Complete Streets policy must be documented in writing by the City Engineer
with supporting data that indicates the reason for the decision. The documented decision(s)
will be reviewed by the City Manager or designee. Exceptions are limited to the following:
Where there are relatively high safety risks. There are times bicycle and pedestrian
facility standards cannot be met due to roadway topographic constraints or it is
impractical to make the street safe for shared use. Roads with a combination of traffic
volumes exceeding 18,000 vehicles per day, constrained and fixed rights-of-way, or
posted speeds of 45+ mph may need special consideration. This type of exception is
highly problematic because high traffic volume is often an indication that a road is the
most direct connection between multiple origins and destinations, and pedestrians,
cyclists and transit users should not be denied access to those destinations. For this
exception to be granted, the City will enhance alternate routes (e.g. signage, bike
boulevard treatments, shared -use trail spurs, bike lanes, shared -lane markings, etc.).
• Where bicyclists and pedestrians are prohibited by law from using the roadway.
Where a main road has multi -modal facilities for all users of the right-of-way, the
PUBLIC FRONTAGE ROAD may be exempt from this policy.
Where the project consists primarily of the installation of traffic control, including pre -
timed traffic signals, or safety devices and little or no additional right-of-way is to be
acquired. However whenever new traffic control detection devices are installed they
must be capable of detecting bicycles. All new pedestrian crossing devices must also
meet the most current accessibility standards for controls, signals, and placement.
• Where a project involves emergency maintenance activities designed to keep assets in
serviceable condition or when interim measures are implemented on temporary
detour routes.
• Where the Director of Public Works and the Director of Neighborhood & Development
Services jointly determine the construction is not practically feasible due to significant
or adverse environmental impacts to waterways, floodplains, significant street trees,
remnants of native vegetation, wetlands, or other critical areas.
• Where the cost of establishing bikeways or walkways would be excessively
disproportionate to the cost of project. In accordance with federal guidelines,
excessively disproportionate is defined as exceeding twenty percent of the cost of the
total transportation project (including right of way acquisition costs). This exception
must consider probable use through the life of the project, a minimum of 20 years.
• Where scarcity of population or other factors indicate an absence of need for current
and future conditions. This exception must take the long view and consider probable
use through the life of the project, a minimum of 20 years.
• Where the Average Daily Traffic count (ADT) is projected to be less than 1,000 vehicles
per day over the life of the project.
Performance Measures
The City will measure the success of Complete Streets policy by using the following measures:
• Miles of bike lanes, trails, shared lane arrows striped or built
• Linear feet of pedestrian accommodations built
• Number of ADA accessibility accommodations built
• Number of exemptions from this policy approved
• Number of projects in which street trees were planted
Definitions
A. COMPLETE STREET: a street that accommodates convenient and safe use by everyone,
regardless of age, ability, or mode of travel.
B. CONTEXT SENSITIVE DESIGN SOLUTION: a design which balances safety, mobility and
transportation needs, while preserving scenic, aesthetic, historical, environmental,
neighborhood and community values and characteristics.
C. STREET: The STREET is considered to be the subgrade, base, pavement, grading, storm
sewer, and sub -drains. (i.e., all of the elements required to build, operate, and maintain
the street.)
D. NEW STREET: a street constructed where one has not previously existed.
E. RECONSTRUCTED STREET: an existing street that has rehabilitation done to it, which is
estimated at 50% or higher of the cost of NEW STREET (excluding utilities except storm
sewer or sub -drains), will also be considered a RECONSTRUCTED STREET for the
purposes of this policy.
F. PUBLIC STREET: a roadway owned and maintained by the City of Iowa City, providing
frontage for (a) parcel(s) of property as set forth in the City Code of Iowa City, Title 14
Zoning Code.
G. PRIVATE STREET: a privately owned and maintained roadway established by final
platting or otherwise established as approved by the City of Iowa City, providing
frontage for (a) parcel(s) of property as set forth in the City Zoning regulations.
H. PUBLIC FRONTAGE ROAD: a roadway located with portions of PUBLIC STREET right-of-
way, frontage road reservation easement or adjoining other streets, which have access
control.
STREET MAINTENANCE: rehabilitation of a street, which generally restores the
functionality of the existing street components (either primarily as a street project or in
conjunction with underground public utility construction), without significantly altering
or adding to those components, and which is estimated at less than 50% of the cost of a
NEW STREET with those same components. Utility construction (except storm sewer or
sub -drains) is excluded from this cost calculation.
J. PARKWAY: The non -driveway area of public right-of-way between the back of curb or
edge of roadway and the right-of-way line.
CITY OF IOWA CITY
MEMORANDUM
Date: March 8, 2015
To: Tom Markus; City Manager
Geoff Fruin; Assistant City Manager
From: Kent Ralston; Transportation Planner
Jason Havel; City Engineer
Re: Revised Complete Streets Policy
Introduction: As part of the City's efforts to achieve a Blue Zones designation, staff has drafted
a revised Complete Streets Policy (attached). The revised Complete Streets Policy is intended
to ensure that roadways and public right-of-way are designed to accommodate all users and
modes of transportation including: pedestrians, bicyclists, transit riders, and motorists. Through
the use of the Policy, the City expects to realize long-term benefits including, but not limited to,
improved public health, reduced fuel consumption, improved environmental stewardship, and
reduced demand for motor vehicle infrastructure.
History/Background: In 2007, Iowa City was one of the first communities in the state to adopt
a complete streets policy. Since that time, City projects have included complete streets
elements in an effort to meet the intent of the policy. However, through the City's recent efforts
to become a Blue Zone, it became apparent that the existing policy lacks specificity and detail
typical of newer complete streets policies — a drawback of being one of the first to implement
such a policy.
Discussion of Solutions: Staff has drafted a revised Complete Streets Policy that will
address/accommodate all users and modes of transportation within a road corridor. The Policy
will be utilized for all new road projects and major reconstruction projects; exemptions from the
policy are enumerated in the document and will be documented in writing by the City Engineer.
Exemptions will ultimately be granted by the City Manager or designee.
Financial Impact: Staff does not anticipate that the adoption of the revised Complete Streets
Policy will result in an increased financial impact for City capital improvement projects. This is
demonstrated by the fact that the City has an existing Complete Streets Policy and has been
implementing the policy in City construction projects since 2007. In practice, while the revised
policy provides detail on tracking performance measures and more specificity on potential
exemptions from the policy, the general intent of the policy remains unchanged.
Recommendation: Staff recommends City Council approval of the Resolution adopting a
revised Complete Streets Policy for Iowa City.
Prepared by: Jason Havel, City Engineer, 410 E. Washington St., Iowa City, IA 52240 (319)356-5410
RESOLUTION NO. 15-82
RESOLUTION AWARDING CONTRACT AND AUTHORIZING THE MAYOR TO
SIGN AND THE CITY CLERK TO ATTEST A CONTRACT FOR
CONSTRUCTION OF THE FIRST AVENUE GRADE SEPARATION PROJECT
[STP -U-3715(636)--70-52].
WHEREAS, Peterson Contractors Inc. of Reinbeck, Iowa has submitted the lowest responsible
bid of $7,860,886.75 for construction of the above-named project; and
WHEREAS, funds for this project are available in the 1st Ave/IAIS RR Crossing Improvements
account # S3871.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA
CITY, IOWA, THAT:
1. The contract for the construction of the above-named project is hereby awarded to
Peterson Contractors Inc., subject to the condition that awardee secure adequate bond
and insurance certificates.
2. The Mayor is hereby authorized to sign the contract for construction of the above-named
project and the Contractor's Bond, subject to the condition that awardee secure adequate
bond and insurance certificates.
3. The City Engineer is authorized to execute change orders as they may become necessary
in the construction of the above-named project.
Passed and approved this 23rd day of March 120 15
ATTEST:
CITY CLERK
s
MAYOR
Ap roved by
City Attorney's Office �S-
It was moved by Dickens and seconded by Payne the Resolution be
adopted, and upon roll call there were:
AYES:
NAYS: ABSENT:
X
Botchway
X
Dickens
X
Dobyns
X
Hayek
X
Mims
X
Payne
X
Throgmorton
Prepared by: Jason Havel, City Engineer, 410 E. Washington St., Iowa City, IA ,'240 (319)356-5410
RESOLUTION NO.
RESOLUTION AWARDING CONTRACT AND AUTHO ING THE MAYOR TO
SIGN AND THE CITY CLERK TO ATTES A CONTRACT FOR
CONSTRUCTION OF THE FIRST AVENUE GRA SEPARATION PROJECT
[STP -U-3715(636)--70-52].
WHEREAS, _
responsible bid
WHEREAS, funds
account # S3871.
of
for construction of
03-23-15
3d(3)
monowilm
has submitted the lowest
ed project; and
this project are available in 1sta Ave/IAIS RR Crossing Improvements
NOW, THEREFORE, B�IT RESOLVED
CITY, IOWA, THAT:
1. The contract for thonstruction,
adequate bond and insure (
2. The Mayor is hereby author
project and the Contractor's
bond and insurance certifica
CITY COUNCIL OF THE CITY OF IOWA
�6f the above-named project is hereby awarded to
, subject to the condition that awardee secure
cates.
to sign the contract for construction of the above-named
td, subject to the condition that awardee secure adequate
3. The City Engineer is auth,6rized to ex6�
in the construction of the,/`above-named
Passed and approved this T day of _
change orders as they may become necessary
ect.
MAYOR
ATTEST:
CITY CLERK
It was moved by and seconded by
adopted, and upone oll call there were:
AYES: NAYS:
pweng\masters\awrdcon.doc
3/15
20
Ml
City AlorneyIs Office
the Resolution be
ABSENT:
Dickens
Dobyns
Hayek
Mims
Payne
Throgmorton
NOTICE TO BIDDERS
STATE OF IOWA — Sealed bids will be received by the Iowa Department of Transportation (DOT),
Office of Contracts, 800 Lincoln Way, Ames, Iowa 50010 on March 17, 2015 at 10:00 A.M. for various
items of construction and/or maintenance work.
Plans, specifications and proposal forms for the work may be seen at the Office of Contracts until noon
on the day previous to the letting.
Proposal guaranties are to be sent to the Office of Contracts at the address above. Iowa DOT
personnel will be available to accept proposal guaranties during regular business hours of 8:00 a.m. to
4:30 p.m.
The Iowa DOT uses the Bid Express website (www.bidx.com) as an official depository for bid submittal.
The Iowa DOT will ensure this depository is available for a two-hour period prior to the deadline for
submission of bids. If there is an interruption of communications or loss of service by Bid Express
during this two-hour period, the Iowa DOT will delay the deadline for bid submissions to allow potential
bidders to submit bids. Instructions will be communicated to potential bidders.
Opening and reading of the bids will be performed at the Office of Contracts after 10:30 A.M. on the day
bids are to be received, unless otherwise specified by the Iowa DOT.
All proposals must be filed on the forms furnished by the Office of Contracts, sealed and plainly
marked. Proposals containing any reservations not provided for in the forms furnished will be rejected.
The Iowa DOT reserves the right to waive technicalities and to reject any or all bids.
A proposal guarantee, not less than the amount as set forth in the proposal form, shall be filed with
each proposal. The proposal guarantee shall be in the form of a certified check or credit union certified
share draft, cashier's check, money order or bank draft drawn on a solvent bank or credit union.
Certified checks or credit union certified share drafts shall bear an endorsement signed by a
responsible official of such bank or credit union as to the amount certified. Cashier's checks, money
orders or bank drafts shall be made payable either to the contracting authority or to the bidder; and,
where made payable to the bidder, shall contain an unqualified endorsement to the contracting
authority signed by the bidder or the bidder's authorized agent. A properly completed Proposal
Guaranty/Bid Bond (form 131084) or a properly completed Contractor's Annual Bid Bond (form 650043)
may be used in lieu of the monetary options specified above. Both forms are available from the Office
of Contracts.
Per Iowa Code section 423.3 (80), the contracting authority will issue an exemption certificate for the
purchase or use of building materials, supplies and equipment used in the performance of the
construction contract.
Failure to execute a contract and file an acceptable performance bond and certificate of insurance
within 30 days of the approval date for awarding the contract will be just and sufficient cause for the
denial of the award and the forfeiture of the proposal guarantee.
The Iowa DOT (or other approved contracting authority) hereby notifies all bidders that it will
affirmatively ensure that in any contract entered into pursuant to this advertisement, disadvantaged
business enterprises will be afforded full opportunity to submit bids in response to this invitation and will
not be discriminated against on the grounds of race, color, or national origin in consideration for an
award.
On Federal Aid projects, where disadvantaged business enterprise (DBE) goals have been established,
the bidder is required to complete and submit form 102115 with the bid documents. On all projects
without DBE goals, the contractor must show that affirmative action has been made to seek out and
consider DBEs as potential subcontractors.
Some projects may be listed in multiple proposals (as an individual project or as part of a combined
package of projects). The Contracting Authority will determine which combination of proposals produce
the lowest bid for these projects.
The listing of projects open for bids and details for each project will be available to potential bidders and
suppliers three (3) weeks prior to the letting date at: www.bidx.com/ia/main or
www.iowadot.gov/contracts/index/htm or by calling the Office of Contracts at 515-239-1414.
Minimum wage rates for all federal-aid projects have been predetermined by the U.S. Secretary of
Labor and are set forth in the specifications. However, this does not apply to projects off the federal-aid
highway system. All federal-aid projects are subject to the Contract Work Hours Standards Act, as
amended (title I of Pub. L. 87-581, Aug. 13, 1962, 75 Stat.357) and implementing regulations.
By virtue of statutory authority, a preference will be given to products and provisions grown and coal
produced within Iowa, and also, a resident bidder shall be allowed a preference against a nonresident
bidder from a state or foreign country which gives or requires a preference to bidders from that state or
foreign country both on projects in which there are no federal funds involved.
IOWA DEPARTMENT OF TRANSPORTATION
OFFICE OF CONTRACTS
TELEPHONE: 515-239-1414
Bid Order:
015
County:
JOHNSON
Proposal ID:
52-3715-636
Work Type:
BRIDGE NEW — STEEL GIRDER
DBE Goal:
4.0%
Working Days:
170
Late Start Date: 04/20/2015
Guarantee:
$500,000.00
Project:
STP -U-3715(636)--70-52
Route:
FIRST AVE
Location:
IN THE CITY OF IOWA CITY, FIRST AVE.: OVER FIRST AVE.
Prepared by: Susan Dulek, Asst. City Attorney, 410 E. Washington Street, Iowa City, IA 52240 (319) 356-5030
RESOLUTION NO. 15-83
RESOLUTION AUTHORIZING THE MAYOR TO SIGN AND THE CITY
CLERK TO ATTEST AN AMENDMENT TO THE LISTING AGREEMENT
WITH LEPIC-KROEGER REALTORS FOR THE NORTH AIRPORT
SUBDIVISION TO EXTEND THE TERM FOR TEN MONTHS.
WHEREAS, in Resolution No. 12-15, the City Council approved a listing agreement
("Listing Agreement") among the Airport Commission, the City Council, and Lepic-
Kroeger Realtors to sell and lease the property known as the North Airport Subdivision,
aka Aviation Commerce Park, which has been amended twice to extend the term;
WHEREAS, the Listing Agreement will terminate on March 1, 2015;
WHEREAS, there remains 1 lot that has not been sold or is not subject to a purchase
agreement; and
WHEREAS, it is in the best interest of the City of Iowa City to amend to the Listing
Agreement to extend the term until December 31, 2015.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
IOWA CITY, IOWA, THAT the Mayor is authorized to sign and the City Clerk to attest to
the attached Third Amendment to Listing Agreement.
Passed and approved this 23rd day of March, 2015.
Vfa
ATTEST: - �(12�
CITY CLERK
Approved b
3 e)
City Attorney's Office
_03-2315
3d(4)
Resolution No. 15-83
]Page 2
It was moved by Dickens . and seconded by Payne the
Resolution be adopted, and upon roll call there were:
AYES: NAYS: ABSENT:
x Botchway
x Dickens
x Dobyns
x Hayek
x Mims
x Payne
x Throgmorton
AMENDMENT TO LISTING AGREEMENT
The is an amendment to the Listing Agreement made and entered into among Lepic-Kroeger, Realtors
("Agent"), the City of Iowa City, a municipal corporation, ("Owner"), and the Iowa City Airport
Commission ("Commission") on November 28, 2013 ("Listing Agreement") in Iowa City, Iowa
thereof:
WHEREAS, the parties wish to amend the Listing Agreement to extend the term by one year to
end on 3-1-2016.
THEREFORE, the parties agree to amend the Listing Agreement as follows:
Paragraph 5 is deleted in its entirety and the following new Paragraph 5 is substituted in lieu
S. TERM. The term of this Agreement and the Agent's employment, righ and authority shall be
from the date of execution through f"-•..� 1, 2916. 1-1131 I (� C
All other terms of the Listing Agreement, not inconsistent with this amendment, remain in full force and
effect.
CITY OF IOWA CITY
agc &.a4
Mathew J. Hayek, Mayor
Attest:
Marian K. Karr, City Clerk
THE IOWA CITY AIRPORT COMMISSION
LEPIC-KROEGER, REALTORS
Christirrr gen, Chairperson
h��airpersson
THIRD
AMENDMENT TO LISTING AGREEMENT
The is an amendment to thA Listing Agreement made and entered into among Lepic-Kroeger, Realtors
("Agent"), the City of Iowaty, a municipal corporation, ("Owner"), and the Iowa City Airport
Commission ("Commission") n November 28, 2013 ("Listing Agreement") in Iowa ity, Iowa
WHEREAS, the parties ish to amend the Listing Agreement to extend t e term by one year to
end on 3-1-2016.
THEREFORE, the parties\Areement
amend the Listing Agreement as f lows:
Paragraph 5 is deleted iety and the following new Para raph 5 is substituted in lieu
thereof:
S. TERM. The term of tand the Agent's a loyment, right and authority shall be
from the date of execuugh March 1, 2016.All other terms of the Listing Agnot inconsistent wid this amendment, remain in full force and
effect. r
CITY OF IOWA CITY
Mathew J. Hayek, Mayor
Attest:
Marian K. Karr, City
THE IOWA CITY/AIRPORT COMMISSION
Christine Orgen, Chairperson
LEPIC-KROEGER, REALTORS
CITY ACKNOWLEGEMENT
STATE OF IOWA
)SS
JOHNSON COUNTY
On this 23 day of n` 1aCr-,A -- 2015, before me, the undersigned, a notary public
in and for the State of Iowa, personally appeared Mathew J. Hayek and Marian K. Karr, to me personally
known, who being by me duly sworn, did say that they are the Mayor and City Clerk, respectively, of said
municipal corporation executing the within and forgoing instrument, that the seal affixed thereto Is the
seal of said municipal corporation; that said instrument was signed and sealed on behalf of said
municipal corporation by authority of its City Council; and that the said Mayor and City Clerk as such
officers acknowledged and the execution of said instrument to be the voluntary act and deed of said
corporation, by it and by them voluntarily executed.
iPoc t�ELLIE K. TUTTLE
.� Commis K:nilumber22'r
p.,y Co mis 'on Exp
I"1u, !
Approved by
City Attorney's Office
Notary Public in and for the State of Iowa
03-23-15
Prepared by: Dave Panos, Civil Engineer, 410 E. Washington St., Iowa City, IA 52240 (319) 356-5145
RESOLUTION NO. 15-84
RESOLUTION APPROVING PLANS, SPECIFICATIONS, FORM OF CONTRACT
AND ESTIMATE OF COST FOR THE CONSTRUCTION OF THE ASPHALT
RESURFACING PROJECT 2015, ESTABLISHING AMOUNT OF BID SECURITY
TO ACCOMPANY EACH BID, DIRECTING CITY CLERK TO PUBLISH NOTICE
TO BIDDERS, AND FIXING TIME AND PLACE FOR RECEIPT OF BIDS.
WHEREAS, notice of public hearing on the plans, specifications, form of contract and estimate
of cost for the above-named project was published as required by law, and the hearing thereon
held.
WHEREAS, funds for this project are available in the Pavement Rehabilitation account # S3824.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF IOWA CITY,
IOWA THAT:
1. The plans, specifications, form of contract, and estimate of cost for the above-named
project are hereby approved.
2. The amount of bid security to accompany each bid for the construction of the above-
named project shall be in the amount of 10% (ten percent) of bid payable to Treasurer,
City of Iowa City, Iowa.
3. The City Clerk is hereby authorized and directed to publish notice, not less than 4 and
not more than 45 days before the date for filing the bids, for the receipt of bids for the
construction of the above-named project in a newspaper published at least once weekly
and having a general circulation in the city.
4. Sealed bids for the above-named project are to be received by the City of Iowa City,
Iowa, at the office of the City Clerk at the City Hall, before 2:30 pm on the 10th day of
April, 2015. At that time, the bids will be opened by the City Engineer or his designee,
and thereupon referred to the City Council of the City of Iowa City, Iowa, for action upon
said bids at its next meeting, to be held at the Emma J. Harvat Hall, City Hall, Iowa City,
Iowa, at 7:00 p.m. on the 21st day of April, 2014, or at a later date and/or time as
determined by the Director of Public Works or designee.
Passed and approved this 23rd day of March _,2015.
Mayor
Approved by:
ATTEST: L"
City Crerk City Attorneys Office�r� �/S
Resolution No. 15-84
Page 2
It was moved by Payne and seconded by Botchway the
Resolution be adopted, and upon roll call there were:
AYES: NAYS: ABSENT:
x Botchway
x Dickens
x Dobyns
x Hayek
x Mims
x Payne
x Throgmorton
Prepared by: Kumi Morris, Public Works, 410 E. Washington St., Iowa City, IA 52240 (319) 356-5044
RESOLUTION NO. 15-85
RESOLUTION APPROVING PLANS, SPECIFICATIONS, FORM OF CON-
TRACT, AND ESTIMATE OF COST FOR THE CONSTRUCTION OF THE CITY
HALL LOBBY, REVENUE, HARVAT HALL & NDS 2015 RENOVATION
PROJECT, ESTABLISHING AMOUNT OF BID SECURITY TO ACCOMPANY
EACH BID, DIRECTING CITY CLERK TO PUBLISH NOTICE TO BIDDERS, AND
FIXING TIME AND PLACE FOR RECEIPT OF BIDS.
WHEREAS, notice of public hearing on the plans, specifications, form of contract and estimate of
cost for the above-named project was published as required by law, and the hearing thereon held;
and
WHEREAS, funds for this project are available in the following accounts: G4721 City Hall
Remodel for NDS Integration and G4714 Remodel City Hall and Revenue.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA
CITY, IOWA THAT:
The plans, specifications, form of contract and estimate of cost for the above-named
project are hereby approved.
2. The amount of bid security to accompany each bid for the construction of the above-
named project shall be in the amount of 10% (ten percent) of bid payable to Treasurer,
City of Iowa City, Iowa.
3. The City Clerk is hereby authorized and directed to publish notice, not less than 4 and not
more than 45 days before the date for filing the bids, for the receipt of bids for the
construction of the above-named project in a newspaper published at least once weekly
and having a general circulation in the city.
4. Sealed bids for the above-named project are to be received by the City of Iowa City, Iowa,
at the Office of the City Clerk, at the City Hall, before 2:30 p.m. on the 16th day of April,
2015. At that time, the bids will be opened by the City Engineer or his designee, and
thereupon referred to the City Council of the City of Iowa City, Iowa, for action upon said
bids at its next regular meeting, to be held at the Emma J. Harvat Hall, City Hall, Iowa City,
Iowa, at 7:00 p.m. on the 21s' day of April, 2015, or at a special meeting called for that
purpose.
Passed and approved this 23rd day of March 20 15
ATTEST:-
CITY CLERK
A rovedf�by
u
City Attorney's Office rco (I S
S:\ENG\PW\Resolutions\Project ResolutionsWccept Plans & Specs\Resolution to Approve Plans & Specs for City Hall Lobby Revenue Harvat Hall & NDS
2015 Renovation.doc 3/15
Resolution No. 15-85
Page 2
It was moved by Dobyns and seconded by Botchway the
Resolution be adopted, and upon roll call there were:
AYES: NAYS: ABSENT:
x Botchway
x Dickens
x Dobyns
x Hayek
x Mims
x Payne
x Throgmorton
Prepared by: Wendy Ford, 410 E. Washington St., Iowa City, IA 52240 (319) 356-5248
RESOLUTION NO
15-86
RESOLUTION APPROVING AMENDMENT NO. 13 TO THE CITY -UNIVERSITY
PROJECT 1 URBAN RENEWAL PLAN TO MODIFY PROPOSED URBAN
RENEWAL PROJECT.
WHEREAS, on February 9, 2015, City Council adopted a resolution of
necessity (Reso. No. 15-33) contemplating an amendment to the City -University
Project 1 Urban Renewal Plan to facilitate consideration of a new urban renewal
project, said amendment being the 13th amendment thereto, and
WHEREAS, in addition to the projects in the City -University Project I Urban
Renewal Area Urban Renewal Plan, as previously amended, proposed Urban
Renewal Projects under this amendment include a private development agreement for
a hotel project on South Clinton Street across from the new University of Iowa School
of Music; and
WHEREAS, pursuant to Reso. No. 15-33, consultation with affected taxing
entities was duly held and all required responses to the recommendations made by the
affected taxing entities, have been timely made as set forth in the report of the
Economic Development Coordinator filed herewith and incorporated herein by the
reference, which report is in all respects approved; and
WHEREAS, pursuant to said Reso. No. 15-33, a public hearing was held after
due and proper notice of said public hearing was given, as provided by law, by timely
publication in the Press Citizen.
NOW, THEREFORE, BE IT RESOLVED, BY THE CITY COUNCIL OF THE
CITY OF IOWA CITY, IOWA:
Section 1. This Council finds that the Amendment No. 13 to the City -University
Project 1 Urban Renewal Plan conforms to the general plan for the development of the
City as a whole; and.
Section 2. That the Amendment No. 13 is hereby approved and adopted as the
"Amendment No. 13 to the City -University Project 1 Urban Renewal Plan for the City -
University Project 1 Urban Renewal Area"; and the City Clerk is hereby directed to file
a certified copy of said Amendment No. 13 with the proceedings of this meeting.
Section 3. That the City -University Project 1 Urban Renewal Plan for the City -
University Project 1 Urban Renewal Plan Area, as amended herein, shall be in full
force and effect from the date of this resolution until the later of the date of termination
set forth in the Plan, as amended, or the date on which payment of all obligations
issued or advances made to carry out the purposes thereof shall be fully provided for.
Said Amendment No. 13 shall be forthwith certified by the City Clerk, along with a copy
of this Resolution, to the Recorder for Johnson County, Iowa, to be filed and recorded
in the manner provided by law.
PASSED AND APPROVED this 23rd day of March , 2015.
-1-
ATTEST:
City C e k
ApprMd By
City Attorney's Office -'/13
-2-
Mayor
ResolutionNo. 15-8
)Page 3
It was moved by Payne and seconded by Dickens the
Resolution be adopted, and upon roll call there were:
AYES:
NAYS: ABSENT:
x
Botchway
x
Dickens
x
Dobyns
x
Hayek
x
Mims
x
Payne
x
Throgmorton
Amendment No. 13
City -University Project 1
Urban Renewal Plan
City of Iowa City, IA
Original Area Adopted 1969
Amendment No. 1 —1972
Amendment No. 2 —1973
Amendment No. 3 —1973
Amendment No. 4 —1976
Amendment No. 5 —1977
Amendment No. 6 —1979
Amendment No. 7 —1984
Amendment No. 8 —1987
Amendment No. 9 — 2001
Amendment No. 10 — 2012
Amendment No. 11 — 2013
Amendment No. 12 — 2014
Table of Contents
Section 1 — Introduction
Section 2 — History and Background
Section 3 - Proposed Urban Renewal Projects
Section 4 — Proposed Urban Renewal Activities
Section 5 - Debt
Section 6 - Effective Period
Section 7 - Repealer
Section 8 - Severability Clause
Attachment No. 1 - City University Project 1 Urban Renewal Area as amended
Attachment No. 2 - Legal Description
-2-
SECTION 1- INTRODUCTION
The City -University Project I Urban Renewal Plan ("Plan") for the City -University
Project I Urban Renewal Area ("Area"), as amended, is being further amended herein to
modify the estimated cost of a development agreement, and to add another project.
Originally adopted in 1969, the Plan has been previously amended twelve times.
Of those previous amendments, land was added to the Area pursuant to the 2001 and
the 2012 Amendment No. 10. The Original Area, the 2001 Amended Area, and the 2012
Amendment No. 10 Amended Area, comprise the Area. The Area is depicted on
Attachment No. 1 and legally described on Attachment No. 2, attached hereto.
No land is being added to the Area by this Amendment. This amendment does
not change the Plan's previously approved project area objectives or urban renewal
activities. Except as modified by this Amendment, the provisions of the original City -
University Project I Urban Renewal Plan, as previously amended, are hereby ratified,
confirmed, and approved and shall remain in full force and effect. In case of any conflict
or uncertainty, the terms of this Amendment shall control.
SECTION 2 - PROPOSED URBAN RENEWAL PROJECTS
Although certain project activities may occur over a period of years, in addition to
the projects previously proposed in the Plan, as amended, the development agreement
for the Hotel Development at 328 S. Clinton Street is amended as follows and an
additional development agreement for a proposed urban renewal project is hereby
added to the Plan:
1. Development Agreements:
Hotel Development at
2015-2016
Not to exceed
Economic Development and blight
328 S. Clinton Street:
$8,900,000
remediation; in -fill development of
Development
land vacant as a result of tornado
Agreement to support
damage; provision of additional
construction of a new
downtown guest rooms to serve
hotel.
demand demonstrated in multiple
market studies.
SECTION 3 — PROPOSED URBAN RENEWAL ACTIVITIES
All activities or actions from previous Plan amendments continue, namely;
clearance and development of buildings; incentivizing improvements to historic and non -
historic structures; making certain public improvements to roadways and facilities, all as
detailed in previous Plan amendments. Financial incentives may be offered for
proposed urban renewal activities, actions and projects, in the form of tax increment
financing, exclusion from property taxation during construction, both as detailed in
previous Plan amendments. In addition to these sources, the City may provide financial
-3-
incentives through utilization of revenues received pursuant to the Local Transient
Guest Tax Fund (known as the "hotel and motel tax"), to the extent allowable under
Iowa Code Section 423A.7 and Iowa Code Chapter 403. Pursuant to resolution
approved by the City Council, the utilization of this revenue source for this purpose will
not exceed 50% of those revenues collected from the hotel to be constructed pursuant
to the Developer's Agreement described in Section 2 above, subject to the terms of said
agreement.
SECTION 4 - DEBT
1. FY 2014 constitutional debt limit:
$233,415,950
2. Outstanding general obligation debt:
$67,075,000
3. Proposed amount of loans, advances, indebtedness or bonds to
be incurred: The specific amount of debt to be incurred for the
Proposed Urban Renewal Projects has not yet been
determined. The Projects authorized in this Amendment are
only proposed projects at this time. The City Council will
consider each proposed project on a case-by-case basis to
determine if it is consistent with the Plan and in the public's best
interest. These proposed Projects, if approved, will commence
and be concluded over a number of years. In no event will debt
be incurred that would exceed the City's debt capacity. It is
expected that such indebtedness, including interest thereon,
may be financed in whole or in part with tax increment revenues
from the Urban Renewal Area. Subject to the foregoing, it is
estimated that the cost of the Proposed Urban Renewal
Projects described above will be approximately as follows:
Not to exceed
$8,900,000
SECTION 5 — URBAN RENEWAL PLAN AMENDMENTS
If the City of Iowa City desires to amend this Plan, it may do so in conformance with
applicable state and local laws.
SECTION 6 - EFFECTIVE PERIOD
This Urban Renewal Plan Amendment #13 will become effective upon its
adoption by the City Council. Notwithstanding anything to the contrary in the Urban
Renewal Plan, any prior amendment, resolution, or document, the Urban Renewal Plan
shall remain in effect until terminated by the City Council, and the use of incremental
property tax revenues, or the "division of revenue," as those words are used in Chapter
403 of the Code of Iowa, will be consistent with Chapter 403 of the Iowa Code.
SECTION 7 - REPEALER
-4-
Any parts of the previous Plan, as previously amended, in conflict with this
Amendment are hereby repealed.
SECTION 8 - SEVERABILITY CLAUSE
If any part of the Amendment is determined to be invalid or unconstitutional, such
invalidity or unconstitutionality shall not affect the validity of the previously adopted Plan
as a whole or the previous amendments to the Plan, or any part of the Plan not
determined to be invalid or unconstitutional.
-5-
Attachment No. 1
City -University Project 1 Urban Renewal Area
As Amended
Urban renewal area boundary
1969 Original Area
2001 Amended Area
2012 Amended Area qNV
M
Attachment No. 2
1969 Original Area
Beginning at a point on the north R.O.W. line of Burlington Street where it meets the east bank
of the Iowa River,
Thence easterly to the east R.O.W. line of vacated Front Street,
Thence north to the north R.O.W. line of vacated College Street.
Thence east along said R.O.W. line to the west R.O.W. line of Capitol Street.
Thence north along said R.O.W. line to the centerline of Washington Street.
Thence east along said centerline to the centerline of Linn Street.
Thence south along said centerline to the south R.O.W. line of Court Street.
Thence west along said R.O.W. line to the east bank of the Iowa River.
Thence northerly along the east bank to the point of beginning.
2001 Amended Area
Beginning at the northwest corner of Lot 1 Lyman Cooks Subdivision of Outlot 25,
Thence south along the east R.O.W. line of Gilbert Street to the south R.O.W. line of Prentiss
Street.
Thence west along said south R.O.W. line to its intersection with Linn Street.
Thence northeasterly along Ralston Creek to the west R.O.W. line of Maiden Lane.
Thence north to the south R.O.W. line of Court Street.
Thence west along said south R.O.W. line to the centerline of Linn Street.
Thence north along said centerline to the centerline of Washington Street.
Thence west along said centerline to the west R.O.W. line of Clinton Street.
Thence north along said west R.O.W. line to the north R.O.W. line of Iowa Avenue.
Thence east along said north R.O.W. line to the east R.O.W. line of Gilbert Street.
Thence south along said east R.O.W. line to the point of beginning..
2012 Amended Area
Beginning at the NW corner of Outlot 26, Original Town Subdivision; Thence south along the
eastern R.O.W. line of Van Buren Street to where said R.O.W. ends at a point along the
western boundary of Block 8, Lyon's 2nd Addition; Thence northwesterly along R.O.W. line to a
point on the north R.O.W. line of the Iowa Interstate Railroad south of block 1, Lyon's 1st
Addition; Thence southwesterly to the south R.O.W. line of the Iowa Interstate Railroad north of
block 3, Lyon's 1st Addition; Thence southeasterly along the south Railroad R.O.W. to the
eastern boundary of Van Buren Street south of the Railroad; Thence along said eastern
boundary of Van Buren Street to the north right-of-way line of Kirkwood Avenue; Thence east to
a point 11' west of the extended NE corner of lot 3, block 6, F.S. & E.W. Lucas Addition;
Continuing south to a point 126', more or less, south of the R.O.W. line of the E -W alley west of
Diana Street and south of lots 1, 2, and 3, block 6, R.S. Lucas Addition; Thence westerly to a
point on the east R.O.W. line of the N -S alley west of lots 4 & 5, block 6, R.S. Lucas Addition;
Crossing the alley to the west R.O.W. line of said alley, continue south 7.5', more or less, to the
NE corner of lot 30, Highland Park Addition; Thence westerly to the NW corner of lot 31,
Highland Park Addition; Thence southerly to the SW corner of said Lot 31; Crossing Highland
Ct. to the NE corner of Lot 15 Highland Park Addition; Thence southerly to the SE corner of Lot
9 Highland Park Addition; Crossing Highland Ave. to the south R.O.W. line; Thence westerly
along said south R.O.W. line to where it meets the Crandic Railroad; Thence south along the
Crandic Railroad to the south R.O.W. line of Highway 6; Thence west along the south R.O.W.
line of Highway 6 to the eastern bank of the Iowa River; Thence southerly following said eastern
-7-
bank of the river to a point where the river bank meets the extended southern line of Sturgis
Ferry Park; Thence westerly to the SW corner of Sturgis Ferry Park; Thence continuing westerly
to the west R.O.W. line of Riverside Drive; Thence northerly along said west R.O.W. line to the
centerline of Highway 6; Thence easterly along said centerline to the western bank of the Iowa
River; Thence following the western bank of the Iowa River to the centerline of Myrtle Street
extended to the Iowa River; Thence west to the west R.O.W. line of Riverside Drive/State
Highway 1; Thence northerly along said highway R.O.W. to the north R.O.W. line of Burlington
Street; Thence east to the east bank of the Iowa River; Thence south to the south R.O.W. line of
Court Street; Thence easterly along the south R.O.W. line of Court Street to the west R.O.W.
line of Maiden Lane; Thence south along said west R.O.W. line to Ralston Creek; Thence
southwesterly along the creek to the south R.O.W. line of Prentiss Street; Thence east along
said south R.O.W. line to the west R.O.W. line of Gilbert Street; Thence south along said west
R.O.W. line to a point where it meets the extended centerline of Bowery Street; Thence easterly
to a point where the centerline of Bowery Street meets the extended east R.O.W. line of Gilbert
Street; Thence north along said east R.O.W. line to the northwest corner of Lot 1 Lyman Cooks
Subdivision of Outlot 25; Thence east along the south R.O.W. line of Burlington Street to the
point of beginning. Also including Lots 5 and 6 in Block 43, Original Town, and the alley and full
width of the College Street right-of-way adjacent thereto.
H I LTO N
VOORLMIDE
"t 20t 21I5
I ..
5WM9KMW
Sr.,, O"emomew
I= w kN27"N K
IOAM
"*A* wo"Oft
M, crawavauro
=W"k TH 3BII?
ft 901-"+$M
m 9ft-31+ww
•t
71=9; 7 1
• E12k4Z TT
0*01 a
VK
Hilton CUIUO
1*I CITY OF IOWA CITY
�_WIRN q�
�O
M E M 0 R A N D U M
%dub..
To: Tom Markus, City Manager
From: Jeff Davidson, Economic Development Administrator
Wendy Ford, Economic Development Coordinator
Date: March 16, 2015
Re: Request for financial assistance from Kinseth Hospitality Company
At the January 12, 2015 meeting of the City Council Economic Development Committee, the
committee unanimously recommended approval of a request for financial assistance from
Kinseth Hospitality Company. The request was for $8.8 million to assist in the construction of a
Hilton Garden Inn Hotel at 328 S. Clinton Street in Riverfront Crossings. The estimated
construction cost of the new hotel is $33.2 million. As summarized in the following staff report,
the financial assistance package approved is a combination of tax increment rebates from the
site, tax increment rebates from the adjacent Art Museum site, and half of the hotel -motel tax
revenues produced by the new hotel.
The inclusion of new tax increment produced by the Art Museum site is intended to reduce the
length of the tax rebate period for the project. As outlined in the staff report, hotels have
increased risk associated with them which introduce a set of financial expectations that are
different from more conventional development projects. There is no guarantee from the City in
terms of taxable value produced by the Art Museum site. If it fails to create increased taxable
value, the tax increment rebate period to the developer will be lengthened.
The development agreement is one of three items on the March 23, 2015 City Council meeting
agenda pertaining to the proposed Hilton Garden Inn Hotel. The City Council should bring any
questions to the March 23 meeting.
cc: Wendy Ford
03-23-15
10
r
CITY OF IOWA CITY
CITY OF IOWA CITY
M E M 0 RA N D U M
UNESCO CITY OF LITERATURE
Date: January 6, 2015
To: City Council Economic Development Committee
From: Jeff Davidson, Economic Development Administrator
Wendy Ford, Economic Development Coordinator
Re: Agenda Item #3: Consider a request for financial assistance from Kinseth Hospitality
Company
Introduction
Kinseth Hospitality Company is proposing a Hilton Garden Inn Hotel to be constructed at 328 S.
Clinton Street in the City -University Urban Renewal Area, across from the new University of
Iowa School of Music currently under construction. The proposed 12 story hotel would be 144
rooms, and feature a meeting/event center, a roof top food and beverage venue, a restaurant,
and a pool/spa/fitness area. The total project cost is estimated at $33,205,936. Kinseth has
identified an $8.8 million gap in its available financing, and thus has requested $8.8 million in
assistance from the City. Staff proposes to fund this gap through $$4.8 million in tax increment
rebates from this site,, $2.5 million in tax increment grants from an adjacent property located
within the Urban Renewal Area, and a maximum of $1.5 million in a refund of the hotel -motel
tax revenues collected from guests at this planned hotel.
The proposed hotel site is currently vacant. It is next door to the recently -selected preferred
location for the new University of Iowa Museum of Art. The Art Museum building will include not
only an art museum, but also other taxable uses that could generate an anticipated $5 million in
increased tax revenue by 2028. The University of Iowa has reacted favorably to a H ilton
Garden Inn at this location, believing it could create positive synergies with the School of Music
and Art Museum projects.
Similar to all hotels in downtown Iowa City, parking for the proposed hotel would be provided
under contract in a City parking facility, in this case the Court Street Transportation Center
which is located directly east. There would be a s kywalk pedestrian connection between the
parking facility and the second level of the hotel. The Court Street Transportation Center was
constructed to accommodate parking demand from redevelopment on the adjacent block.
The current total annual property tax bill on the property is approximately $11,000. The
projected annual property taxes with the new hotel are estimated at $582;500 starting in 2017,
thus making approximately $400,000 annually available from this site alone for the City to utilize
for TIF financing pursuant to Iowa Code Chapter 403 and the City -University Urban Renewal
Plan
Background
The Hilton Garden Inn brand is part of the Hilton Hotels Corporation which consists of 3900
hotels with 350,000 rooms in all 50 states and 90 foreign countries. The Hilton Garden Inn
brand specifically is considered to be in the upper tier of the mid -priced market. Hilton Garden
Inns have restaurant, bar, and room service features, with typically fewer square feet devoted to
these functions than a full service hotel. More details on the Hilton Garden Inn brand are
included in the developer's application materials which are attached.
January 6, 2015
Page 2
Kinseth Hospitality Companies is a hotel development and management company located in
North Liberty, Iowa. Their portfolio of 75 hotels includes properties throughout the Midwest
including Coralville, Dubuque and the Des Moines area. They have developed Fulton Garden
Inns in Bettendorf, Council Bluffs, Omaha, and Manhattan, Kansas.
The economic impacts of the proposed hotel are estimated by the developer to include 36,000
rooms rented annually; 54,000 guests annually; and $6 million in downtown spending annually.
The hotel will employ 150 persons including 12 salaried managers. Hotel -Motel Tax is
estimated at $286,000 in year one, increasing to $494,000 by year 20.
This project is included as a "proposed project" in the City -University Urban Renewal Plan by
virtue of the 12th amendment to the Plan, approved July 31, 2014 (Resolution 14-253). The
stated rationale for including this project as an urban renewal project is "economic development
and blight remediation; in -fill development of land vacant as a result of tomado damage;
provision of additional downtown guest rooms to serve demand demonstrated in multiple market
studies." The Plan, however, estimated the cost of- the developer's agreement to not exceed
$7,100,000. Because this request exceeds that authority, the Plan must be amended to
increase this amount.
Financial Analysis
The National Development Council has conducted financial analysis of the project and
confirmed an $8.8 million financing gap. This analysis included review of a Market Feasibility
Study for the project prepared by an independent hospitality consultant. The NDC report
attached hereto takes into consideration the higher financial risk factors associated with hotel
projects. Hotels have to deal with the probability that on any given night, an unknown square
footage of their property will not be producing revenue. Investors, therefore, require a higher
Internal Rate of Return for hotels than for projects that are primarily residential.
The NDC report summarizes the project financing that is proposed: 47% bank debt, and 26.5%
each from developer equity and TIF. The City's financial assistance would be structured, in
part, as a rebate of 100% of the estimated $400,000 TIF increment annually from the hotel. The
TIF increment does not include the protect debt levy which will continue to flow to the taxing
entities.
Using only the hotel TIF increment results in a 23 year TIF rebate beginning in 2017 to achieve
the full $8.8 million. In order to reduce the amount of time that this increment is captured and
used to finance this project, Staff proposes to capture $250,000 of the annual tax increment
from the adjacent UI Art Museum site once that project is complete, and allocate it toward this
project. The developer of the Art Museum site has estimated the $250,000 annually to
represent approximately 50% of the potential taxable value to be generated from the site. This
TIF generation would begin in Year 5 of the hotel project based on projected timing of the two
projects and reduce the payment period by approximately 4 years.
Staff also proposes return to the Developer up to 50% of the hotel and motel tax revenues
collected from its guests, for a maximum of $120,000 annually. This will be conditioned upon
the continued imposition of the hotel and motel tax and the Iowa City/Coralville CVB agreeing to
forfeit its share of these tax collections. With use of these funding sources, Staff anticipates that
the $8.8M financial assistance will be paid out over the course of 13 years, from 2017 to 2029.
January 6, 2015
Page 3
The City Council Adopted Strategic Plan
The proposed Hilton Garden Inn meets three of the City Council's Strategic Planning Priorities:
a) creating a strong urban core, b) strategic economic development activity, and c) establishing
a solid financial foundation for the City.
Create a Strong Urban Core
As indicated by the current keen interest by many hotel flags, downtown Iowa City is perceived
to be an underserved hotel market. The full service Sheraton Hotel was built in 1984 with 240
rooms, and the Hotel Vetro was added in 2004 with 50 rooms. This modest room inventory has
constrained activities that can be held in downtown Iowa City which require hotel stays. The
addition of 144 rooms with the Hilton Garden Inn flag will strengthen this market significantly.
Strategic Economic Development Activities
In addition to increasing the number of downtown hotel rooms from 290 to 434, the proposed
Hilton Garden Inn will create a strategic alliance between the hotel and Ul School of Music and
proposed UI Art Museum. The hotel is perceived by the University as offering the opportunity
for conference facilities, meeting rooms, and food services that will complement the Music
School and Art Museum.
Establish a Solid Financial Foundation
The hotel developer has estimated annual downtown spending that can be associated with this
new hotel at $6 million. The taxable value of the property will increase from the existing
$315,000 to $13.6 million after the 10% commercial property tax rollback. Annual hotel and
motel tax revenues are projected at $286,000 in year one, increasing to $494,000 by year 20.
Economic Development Policy
The 2014 Economic Development Policies begin with "it shall be the policy of the City of Iowa
City to use the City Council Strategic Plan as the basis for its economic development activities.
Inherent in the plan is to attract new development including residential, commercial and
industrial uses to grow the tax base.
Minimum standards
The 2014 Economic Development policies establish minimum standards required of developers
to be eligible for public financing. Developers must achieve at least some of the standards. The
elements of this project meeting those standards include:
• The project must have high quality architectural and site design.
The proposed hotel is. shown, in the attached materials provided by Kinseth
Hospitality. It is designed by Cities Edge Architects, a firm specializing in hotel
architecture. The building design has undergone many revisions and the
concept in your materials meets the general provisions of the Form Based Code
for Riverfront Crossings.
• Projects must be energy efficient and offer sustainability features above and beyond the
required building code.
January 6, 2015
Page 4
LightStay is a proprietary sustainability performance system used at Hilton hotel
properties. It requires a third party to verify performance benchmarks related to:
■ Energy consumption
■ CO2 emissions
■ Waste output
■ Water consumption
The Hilton Garden Inn proposed on Clinton Street will include specific strategies
for managing rainwater, light pollution, energy metering, refrigerant management,
and lighting efficiency
• Redevelop an underutilized or blighted property.
This property is currently being used as surface parking, and is thus
underutilized, particularly given its proximity to the heart of downtown Iowa City.
This property has been rezoned to a Riverfront Crossings zoning designation. It
is appropriate for higher density development under the provisions of the
Riverfront Crossings Form Based Code.
• Create high quality jobs.
The hotel intends to have 12 full-time managers. Kinseth Hospitality represents
that it has a strong culture of employee benefits and opportunities. They promote
from within whenever possible, and provide advancement opportunities. Kinseth
Hospitality benefits program opportunities include:
■ Health Insurance Plan
■ Dental Insurance Plan
■ 401 K Plan
■ Voluntary Life insurance
■ Disability Insurance
■ PTO (Paid Time Off) benefit — increases with years of employment
■ Bonus plans and employee engagement achievement bonus and awards
■ Career Development — Options for transfer or promotion within Kinseth's
70+ Midwest properties and Corporate operations team
■ Travel discounts
■ Educational opportunities and Training Programs
■ Management Training Program
• Achieve public purposes as detailed in the Comprehensive Plan, Urban Renewal Area
Plan, and City Council Strategic Plan.
The proposed hotel is consistent with all of these planning documents.
• Developer equity must meet or exceed the financial request from the City.
This is accomplished, and detailed in the attached financial report from the
National Development Council.
January 6, 2015
Page 5
TIF Rebates Preferred
The 2014 Economic Development Policy states that for developers seeking financial assistance,
rebates, as opposed to cash up -front, shall be highly preferable. This developer has secured
the additional financing required to do the project without up -front cash.
TIF rebates ensure the City bears no risk because the project will be completed and have paid
100% of its full property tax bill before a portion of that amount is rebated the following year.
The portion of new property taxes not rebated to the developer continues to flow as new tax
revenue to the City, County, and School District.
This proposed financial incentive package, however, includes not only a rebate of 100% of the
tax increment generated from this site, but also 50% of the estimated tax increment captured
from the University of Art Museum mixed-use development, and a payment of a portion of the
hotel and motel tax revenues collected by the City from guests at this hotel.
Summary
Kinseth Hospitality Company has requested City financial assistance to build a Hilton Garden
Inn Hotel at 328 S. Clinton Street in Riverfront Crossings. This is a strategic location adjacent to
the new Ul School of Music, and the selected site for the new Ul Museum of Art. It is a $33
million project with a demonstrated $8.8 million financial gap. Property taxes paid on the site
will increase from approximately $11,000 to $582,500 per year.
In exchange for the recommended $8.8 assistance, the owner has indicated they will:
1. Construct the improvements with a cost of at least $33.2M and a taxable value of $15.1
million as of January 1, 2017, which will result in a final developer investment of 73.5%
of the total project cost after the City's assistance has been paid.
2. Bring the Hilton Garden Inn franchise to the site
3. Construct a 144 -room hotel building which meets the design standards of the Riverfront
Crossings Form Based Code, that includes a meeting/event center, a roof top food and
beverage venue, a restaurant, and a pool /spa/ fitness area, and that is constructed to
comply with the LightStay energy efficlency and sustainability program.
4. Create an estimated 150 jobs, of which 81 will be full-time and 69 will be part-time.
Recommendation
This project will provide a significant addition to the hotel room inventory in downtown Iowa City,
with a prominent, high quality hotel franchise. It will create an important synergy with the
University of Iowa projects, and continue the momentum created by the Riverfront Crossings
Master Plan and Form Based Code.
Staff recommend approval of the City's financial participation as outlined in this memo not to
exceed $8.8 million.
Li
KINSETH
HOSPITALITY COMPANIES
Project Overview:
The following information centers on the development of a twelve -story, steel -framed building featuring
a Hilton Garden Inn hotel, conference/event center and roof top food and beverage venue.
The hotel will have 144 hotel rooms targeting leisure and business travelers.
The hotel complex will be located at 328 S. Clinton Street in downtown Iowa City, Iowa adjacent to the
site of the to be developed U of I art museum and directly across from the University of Iowa's new
School of Music. The project is under development by Kinseth Hospitality Companies (KHC), an Iowa
based hotel development and hospitality management company.
KHC believes this hotel project will be highly successful due to a number of key factors. The project has
one of the best locations in the market with the hotel site located in the heart of downtown Iowa City
adjacent to University buildings and amenities. Additionally with the strength of the local hospitality
market, Iowa City's limited current supply of hotel rooms downtown and a strong brand affiliation will
make the project the market leading hospitality facility.
1
"6
I ®� KINSETH
HOSPITALITY COMPANIES
Building Program:
Floor
Sq ft
# Rooms
Roof top venue
Indoor/outdoor
5,000
12
7,800
8
Hotel Rooms
11
7,800
8
Hotel Rooms
10
7,800
16
Hotel Rooms
9
7,800
16
Hotel Rooms
8
7,800
16
Hotel Rooms
7
7,800
16
Hotel Rooms
6
7,800
16
Hotel Rooms
5
8 400
16
Hotel Rooms
4
8,400
16
Hotel Rooms
3
8,400
16
Hotel Rooms
2
8,400
Amenities & Entrance from
parkiLig deck
1
8,400
-
Lobby & Amenities
Totals:
Hotel Sq. Ft.
96,600
144
Roof Sq. Ft.
5,000
Total Sq. Ft.
101,600
F/ KINSETH
HOSPITALITY COMPANIES
First Floor:
®' KINSETH
HOSPITALITY COMPANIES
Second Floor:
KINSETH
F' omTALITY COMPANIES
Typical Floors:
I F�KINSETH
HOSPITALITY COMPANIES
Rooftop Plaza
KINSETH
HOSPITALITY COMPANIES
Site/Location:
The site for the project is an exceptional location in the heart of downtown Iowa City directly adjacent to
the University of Iowa campus. Dining, entertainment and culture are only steps away with the
downtown district next door featuring a diverse group of restaurants, bars and retail shops. The hotel
facility tower will be a highly visible fixture in the Iowa City skyline. The site is immediate to the
recently announced U of I art Museum site and cross the street is the location for the University of
Iowa's new $152 million School of Music that is currently under construction.
Just recently in October 2014 the U of I announced its selection and intention to have the new Museum
of art built immediately adjacent to the hotel site. As both buildings go through design the clear goal will
be to have the hotel compliment the museum as much as possible.
The new School of Music building, at the southwest corner of Burlington and Clinton streets in
downtown Iowa City, will house a 700 -seat concert hall, a 200 -seat recital hall, an organ performance
hall, a music library, rehearsal and practice rooms, classrooms, a faculty studio and administrative
offices. Construction is scheduled to complete in August 2016. —
bM://music.uiowa edu/bi ildin uilding-construction#overlay-context=Building/.
Both of these high profile cultural hubs will have significant synergies with the hotel. They will help
uniquely define the hotel facility as a destination and provide an awesome blend of culture and
experience.
, KINSETH
HOSPITALITY COMPANIES
Hilton Garden Inn Brand Information and Facilities:
The Hilton Garden Inn brand is one of the ten hospitality brands of Hilton Hotels Corporation. Other
Hilton brands include Waldorf Astoria, Hilton Hotels, Doubletree, Hampton Inn, Embassy Suites,
Homewood Suites, Home2Suites, Conrad International Hotels, and Hilton Grand Vacations. Hilton
Hotels Corporation headquartered in suburban Washington DC, accounts for more than 3,900 franchised
and owned hotels with approximately 350,000 guestrooms in all 50 of the United States, and 90 foreign
countries, per the Hilton Corporation website.
The Hilton Garden Inn brand is supported by the Hilton infrastructure and distribution systems, which
includes the Hilton Worldwide Reservation System and the Hilton `Hhonors' Rewards Program designed
for frequent business travelers who stay at any of the Hilton brand hotels. Members receive free
privileges including both Hilton `Hhonors' points and airline miles, and Hilton has more travel partners
than any other hotel frequency program. Hilton Hotels Corporation also has a marketing and distribution
alliance with Hilton International that allows both companies to work together coordinating and
developing marketing programs to further strengthen the Hilton family of brands on a worldwide basis.
Hilton Garden Inn is designed to appeal to the individual business traveler, small group meetings, and
the weekend family segment of demand in the upper tier of the mid -priced market. It is the fastest
growing brand in the Hilton family and has grown to 540 properties with over 74,000 rooms (per the
Hilton website) open as of December 31, 2013, since the brand launch in 1997. Hilton Garden Inn
hotels range in size from 90 to 250 guest rooms and are generally new construction, although
conversions are considered on a case-by-case basis. Hilton Garden Inn hotels offer a limited menu and
service options for the restaurant, bar and room service. There are fewer square feet of food and
beverage facilities than in a typical full-service hotel such as a Hilton or Doubletree Hotel, although a
full cooked -to -order breakfast is available at all Hilton Garden Inn properties.
As indicated earlier the first Hilton Garden Inn opened in 1977; the most recent hotel operating
information indicates that as a brand, Hilton Garden Inns were operating at a 70.2% occupancy level
achieving an average daily rate of $115.18. Hilton Garden Inn outperforms it competitive set with a
RevPAR index of 119.0%.
The above impressive brand operating statistics continue to support a strong following from hotel
developers and operators, fueling additional construction in suburban and urban destinations across the
United States. Very few markets are currently available to develop a Hilton Garden Inn, as most areas
have been taken for franchise development.
The Hilton Garden Inn brand benefits from a strong affiliation from the Hilton Worldwide Reservation
System. According to the Uniform Franchise Offering Circular for Hilton Garden Inn, the average
percentage of contribution of the Hilton `Hhonors' Guest Rewards Program to occupancy is 53.3
percent. The reservation system and the `Hhonors' programs are key attributes of the brand. Other key
components of the brand include the following:
I ►, KI NSETH
HOSPITALITY COMPANIES
*The Pavilion — Acts as the principal reception/lobby area that includes the restaurant, lounge, guest
check-in, fireplace, soft seating area and cocktail table and chairs. The Pavilion is Hilton Garden Inn's
architectural signature item. With its landmark roofline and expansive walls of glass, the Pavilion
reflects the overall appearance of Hilton Garden Inn in the marketplace. Thirty-foot vaulted ceilings,
signature cupola, chandelier and central fireplace, invite guests to relax and unwind.
*The Pavilion Pantry — A quick stop market is located in the lobby where an assortment of snacks,
beverages, sundries and an assortment of meals and beverages may be taken to the refrigerator,
microwave and coffee maker, located in each guest room.
*24 -Hour Business Center — Office equipment including fax, copier, desktop computer with Internet
connection as well as office supplies are available to guests without a charge.
*Fitness Center and Indoor Pool — Each Hilton Garden Inn is equipped with state-of-the-art aerobic
exercise equipment available to guests 24 -hours a day. The indoor pool and whirlpool, located adjacent to
the exercise facility, are considered an important amenity, which is projected to support superior
penetration of the weekend and leisure markets, such as sports teams, wedding parties, and reunions.
The Hilton Garden Inn guest rooms are furnished as either king or double -double bedded rooms. The
night -stand, armoire, and hospitality center provide a more distinct residential feel while the matching
work desk adds an element of business functionality. The desk features a built-in computer tray, an
adjustable desk lamp and an upholstered chair ergonomically designed for office work. Each room
contains two telephones with two lines, data ports and voice mail. The hotel will also feature wireless
high-speed Internet access.
The Garden Grille and Bar, a signature item of Hilton Garden Inn, will serve breakfast every day, but
lunch and dinner service may be optional during slower periods of occupancy at the hotel to meet the
needs of the marketplace. A plentiful array of entrees and side dishes are presented in either an attractive
buffet line or served tableside from the menu. A staffed bar/lounge will be available, and a full selection
of soft drinks and beer and wine will be available from the Pavilion Pantry.
The Hilton Garden Inn will feature two meeting rooms of approximately 1,250 square feet each (the
rooms have a common moveable partition in order to join the rooms into a 2,500 square foot meeting
room). This small amount of meeting space will allow the hotel to attract guestroom sales from small
groups, both weekday commercial business, and weekend SMERF (Social, Military, Educational,
Religious, Fraternal) business.
In conclusion, given the wide acceptance of the brand nationally, the proposed Hilton Garden Inn is
projected to be a market leader among many different hotel demand segments in the Iowa City/
Coralville marketplace. We anticipate the hotel to be a clear first choice for quality sensitive customers
who prefer the look, ambiance, amenities, size and quality of current prototype Hilton Garden Inn
construction and finnishings standards. The well-established `Hilton' name, its worldwide reservation
system, the full scope of including food and beverage and small meeting facilities are key features and
amenities that support a premium penetration in commercial and leisure demand segments.
I ►, KINSETH
Hosprmrry COMPANIES
Kinseth Hospitality Background
Kinseth Hospitality Companies is a leading Midwest hospitality development & management company
headquartered locally in North Liberty, Iowa. With a large and diverse portfolio of over 75 hotels,
Kinseth offers an approachable, hands-on style of management. As preferred hospitality company by
guests, franchises, hotel owners and lenders, Kinseth is committed to providing clients with many
proven operational systems in all facets of the hospitality business, from hotel development to daily
hotel management systems and services.
Staffed in all areas of hotel management and development, Kinseth has an assembled an experienced
team of hospitality professionals who continually support property level managers in order to
benchmark performance against major competitors, maximize quality, market share and profitability.
Kinsethls extensive background, coupled with a seasoned executive team fosters a culture that is
oriented toward success!
Kinseth Hospitality Companies Hotel Development Services
Kinseth Hospitality Companies is a leader in hotel development with a detailed understanding and
successful track record for developing award-winning, premium branded and independent hospitality
assets. From the construction of new hotels and restaurants, to the re -conception and renovation of
existing properties, Kinscth is determined to maximize return and enhance the value of your hospitality
asset. We offer a thorough blend of hotel development services including customize programs based on
your specific needs. Our services include:
Turnkey Hotel Development Project Management
• Hotel Brand Selection, Plan Review & Concept Development
• Purchasing Furniture, Fixtures & Equipment
• Installing FF&E
• Hotel Property Acquisition
• Coordination of Licenses, Permits & Code Compliance
• In-house Development
• Hotel Construction Services
• Hotel Renovation Services
Similar projects completed:
• Hilton Garden Inn Bettendorf, IA (opening Jan 2015)
• Hilton Garden Inn Council Bluffs, IA
• Hilton Garden Inn Manhattan, KS
• Hilton Garden Inn West Omaha, NE
• Courtyard by Marriott Ankeny, IA
• Courtyard by Marriott Columbia, MO
KINSETH
,. HOSPITALITY COMPANIES
Full List of Hotel's Kinseth Has Developed:
Under Construction or Development
22
Hotel
City, State
Rooms
Year
1
Marriott Courtyard
Ankeny, IA
118
2007
2
Marriott Residence Inn
Lincoln, NE
93
2008
3
Hampton Inn & Suites
Lincoln, NE
83
2008
4
Hilton Garden Inn
Council Bluffs, IA
153
2009
5
Home2 Suites
Omaha, NE
105
2013
6
Holiday Inn
Council Bluffs
187
1996
7
Holiday Inn Express
Coralville, IA
84
1998
8
Hampton Inn
Council, IA
98
2001
9
Country Inn & Suites
Middleton, WI
84
2004
10
Marriott Courtyard
Columbia, MO
134
2005
11
Hilton Garden Inn
Omaha, NE
118
2006
12
Candlewood Suites
Kenosha, WI
91
2006
13
Hampton Inn & Suites
West Bend, WI
83
2007
14
Marriott Spring Hill Suites
Cheyenne, WY
92
2007
15
Hampton Inn & Suites
Grafton, WI
83
2008
16
Country Inn & Suites
St Charles, MO
86
2008
17
Hampton Inn
Dubuque, IA
97
2008
18
Sleep Inn
Milwaukee, WI
80
2009
19
Candlewood Suites
Lacrosse, WI
92
2009
20
Hilton Garden Inn
Manhattan, KS
135
2010
21
Hampton Inn & Suites
Kenosha, WI
93
2015
Under Construction or Development
22
Homewood Suites
Ankeny, IA
92
23
Hilton Garden Inn
Bettendorf, IA
116
West Des Moines,
24
Homewood Suites
IA
105
West Des Moines,
25
Hampton Inn & Suites
IA
100
26
Hampton Inn & Suites
Minooka, IL
93
27
Courtyard by Marriott & Conference Center
Bellevue, NE
120
' I KINSETH
HOSPITALITY COMPANIES
Benefits of This Project to Iowa City:
Increase tax base to Iowa City
The project will allow a portion of the vacant ground at the comer of Burlington and Clinton to be
developed with a significant high-rise use that will produce significant taxable value. We expect the
facility to generate taxable value in excess of $13,500,000.
Significant hotel/motel tax generated
The proposed project is a rare sizeable full service hotel project for the area. With 144 rooms and
planned amenities the project will generate significant hotel/motel taxes. The hotel is expected to
generate hotel/motel tax in excess of $7,800,000 over the course of 20 years.
Creation of jobs in downtown area
In addition to significant construction jobs the project will generate in excess of 150 new long -tern jobs
in downtown area. Many of these employees will also choose to live in or around downtown.
Hotel
Conference
Rooftop & Restaurant
Total
Positive Economic Impact
Non Exempt Employees Salaried Managers
50
4
18
2
70
5
138
12
The hotel will generate significant traffic and spending in downtown Iowa City. The facility will attract
approximately 36,000 rooms rented, 54,000 guests annually who in tum will have a significant positive
economic impact on downtown spending over $6,000,000 incrementally annually.
Taken from Pinnacle Advisors Categorizing Hotel Impact on Communities:
*Direct Impact - Direct impact includes all projected revenues that will be generated from consumers at
the new hotel. This will include all room's revenues, food and beverage revenues from restaurants and
banqueting, as well as other potential revenue sources such as spa or parking. Direct impact also
includes total payroll paid out to employees hired at the hotel as well as all payroll paid out to temporary
construction workers who construct the hotel.
*Fiscal Impact - Fiscal impact refers to all federal, state, and local taxes that will be collected from the
development and operations of the new hotel. Taxes include all sales taxes collected in association with
the hotel -generated revenues, as well as all payroll related taxes collected from full-time hotel
employees and temporary construction workers. Local governments will also collect new property taxes
from the operation of the hotel. Many local governments will also collect revenues through lodging
taxes.
*Indirect Impact - In addition to local governments and hotel owners/employees, contractors and
suppliers to a newly developed hotel will also benefit. Indirect impact includes all jobs and income
KINSETH
HOSPITALITY COMPANIES
generated by businesses that supply goods and services to the hotel. Examples of businesses that will
indirectly benefit from the development of a hotel include suppliers of rooms related goods
(housekeeping supplies, room amenities, etc), telecommunication vendors (internet, cable, etc.), utility
companies, food and beverage suppliers, and other hotel related vendors.
*Induced Impact - Induced impact refers to economic effects generated when employees (full-time and
temporary) and suppliers re -spend their wages on local consumer purchases. For example, an employee
may purchase gas for their car on their way home from work.
I ®� KI NSETH
HOSPITALITY COMPANIES
Synergies with adjacent buildings new and planned
The hotel facility will have many synergies with the surrounding area including the new University of
Iowa School of Music for the many activities, events and shows that will regularly be held. From
symposiums and conferences to and pre and post show events to sleeping rooms for performers and
attendees make this structure a great co -development project to what is already under way at Burlington
and Clinton Streets.
Fair share - Lodging market and Upscale Premium lodging brands
There are various high quality branded hotels in the Iowa City/Coralville region but there are not many
in downtown Iowa City. This project will provide a great added option while also providing Iowa City
a big step in gaining its fair share of premium lodging product. The Sheraton opened building in 1984
and there hasn't been a significant large branded hotel built downtown since.
of Rooms in Downtown Iowa City Vs.
Rest of Area
rs All other Rooms in the area
11%
Downtown Iowa City Rooms
KINSETH
HosPRALIIY COMPANIES
New Experience - High Rise Roof top Venue
*Pictures of a similar rooftop project In downtown Chicago — The Wbit a Doubletree by Hilton
The roof of the high-rise structure is slated to have a unique roof top food and beverage venue that will
feature both indoor and outdoor seating. The pictures above depict the outdoor area of a similar project
in downtown Chicago at The Whit hotel. This highly dynamic roof outlet will offer sweeping indoor and
outdoor views of Iowa City as well the outdoor section will feature lounge seating, fire features
providing a new and unique experience in Iowa City. We expect this space will not only host hotel
guests but also many small to medium sized events as well as the general public.
I ►, KINSETH
HOSPITALITY COMPANIES
Necessary Financial Assistance:
All costs, projected revenues and expenses have been provided to the National Development Council for
review and analysis on this $33,206,000 project. It has been concluded that the financing gap for the
project is $8,800,000. It is requested that TIF financing of $8,800,000 be provided by the City.
The following table lists the sources and uses of funds for this project based on the independent gap
analysis:
Sources and Uses of Funds
Sources
Bank Loan $15,601,000
Equity $8,805,000
City Gap Financing $8,800,000
Total $33,206,000
Uses
Building Construction, Design
$23,440,000
Land
$1,600,000
Furniture, Fixture, and Equip
$3,100,000
Contingency
$500,000
Opening Costs; working capital, training,
$895,000
marketing
Construction interest, Loan Fees, Reserve
$1,256,000
Developer Overhead
2,000,000
Professional Services & Closing Costs
$415,000
Total $33,206,000
MEMORANDUM
Date: December 22, 2014
To: Jeff Davidson, Economic Development Administrator, City of Iowa City
From: Tom Jackson, Director, National Development Council
CC: Wendy Ford, Economic Development Coordinator, City of Iowa City
RE: New Hotel Development at East Burlington and South Clinton Streets
At your request, the National Development Council (NDC) has met with and reviewed materials
submitted by the development team led by Kinseth Hospitality (hereinafter, "the Developer") in
support of a request for City gap financing for the development of a project site at the
southeast corner of East Burlington and South Clinton streets. The Developer proposes to
construct a twelve story tower on the site that would include a 144 -room hotel branded as a
Hilton Garden Inn and Suites. In addition to rooms and suites, the hotel would offer a full-
service restaurant and meeting/banquet rooms.
NDC has requested updated project cost estimates and projected operating revenue and
expenses during meetings, phone conversations and through email correspondence with the
Developer and City staff since the project was first proposed in June 2013. The project has
evolved over the past year from a larger, 182 -room, dual -branded hotel, to a proposal for a
single hotel and residential units, and, in late summer 2014, to the current mix. Its projected
financials have also been adjusted as the project has evolved and in response to City
requirements and recommendations for building setbacks and exterior design improvements.
Consistent with the City's gap financing policies, documentation provided by the Developer to
support their request for gap financing includes:
• A Market Feasibility Study, prepared by Patek Hospitality Consultants, Inc. of Sussex,
Wisconsin and dated June 10, 2013.
• A Development Budget based on:
o Preliminary designs by Cities Edge Architects/Ramaker of Willmar, Minnesota; and,
o Construction cost estimates provided by McComas-Lacina Construction, Iowa
City;
Hotel Project — E. Burlington & S. Clinton
December 22, 2014
Page 2
Operating Revenue and Expense Proformas (revised pursuant to the completion of the
market analysis);
A Term Sheet for permanent financing from Great Western Bank, including maximum
permanent financing and the lender's underwriting criteria; and,
The Development Team's project narrative and statement of experience;
An appraisal providing an opinion as to the project's as -complete fair market value (FMV) has
not been completed. As such, the capitalization rate and estimated debt capacity based in part
on the FMV have been projected given the Developer's financials and the experience of City
staff and NDC with other projects under development in the Downtown Iowa City market. An
appraisal will be completed prior to the project's closing into any private debt or City gap
financing.
NDC's analysis of the projected financials for the project suggest that City gap financing with a
present value of $8,800,000 is reasonable to balance financing sources with projected uses, as
follows:
Total Project Costs $33,205,936
Permanent Financing Sources
Projected Bank Loan
$15,600,968
46.98%
City Gap Funding—TIF
$ 8,800,000
26.50%
Required from Developer
$ 8,804,936
26.52%
Total Permanent Sources
$33,205,936
100.00%
The projected project costs, operating revenues and expenses supplied by the Developer, as
modified over the past year and verified by the independent market feasibility study, support a
recommendation for gap financing for the following reasons:
1) The amount of bank debt attracted to the deal has been maximized given the projected
operating proforma and anticipated underwriting criteria (1.30 debt coverage ratio, 75%
loan to value). These underwriting criteria are more favorable than are typically seen
for hotel financing and exceed the terms provided in the preliminary term sheet
submitted by the Developer. The Developer believes the prime location of the proposed
hotel, the strength of Downtown Iowa City's real estate market and the experience and
financial strength of the development team will secure terms that match those used in
this analysis. The loan amount is also influenced by an assumed capitalization rate of
7.50% which is reasonable for rental and condominium units in the Downtown market,
but very strong for the hotel component and will need to be verified by an as -completed
appraisal prior to the closing of the project's financing.
Hotel Project — E. Burlington & S. Clinton
December 22, 2014
Page 3
2) At $8.804,968 in developer equity:
a. The Developer will earn a projected Internal Rate of Return of 6.89% which,
given risks associated with hotel development and operations (e.g., greater
volatility in demand given economic conditions, weather, competition, etc.), is
reasonable. Cash -ort -cash returns are not projected to exceed 10% until after
Year 10 following an initial three year stabilization period for the hotel to
become established in the market.
b. The project costs include a Developer Fee of $2,000,000, which is 7.1% of hard
costs. The fee will be at risk if cost overruns during predevelopment and
construction exceed current projections.
Conclusion: the project as presented demonstrates that TIF -supported gap financing with a
present value of $8,800,000 is reasonable. If the terms of the selected senior debt and updated
project costs are substantially different from what the Developer has projected, NDC will
review this evaluation as requested by the City.
THIS AGREEMENT FOR PRIVATE REDEVELOPMENT
"Agreement"), is n,qde on or as of the day of
the CITY OF IOWA ITY, IOWA, a municipality (hereinafter called "C
the Code of Iowa of the tate of Iowa and acting under the authorization
403 of the Code of Iowa, 015, as amended (hereinafter called "Urban R
Hotel Associates, L.L.C. ving an office for the transaction of busin4
North Liberty, Iowa, 52317`(the "Developer").
WITNESSETH:
(hereinafter called
2015, by and among
,tablished pursuant to
Chapter 15A and Chapter
;wal Act") and Iowa City
at 2 Quail Creek Circle,
WHEREAS, in furtheran e ofthe objectives of the rban Renewal Act, the City has
undertaken a program for the clear ce and reconstruction or ehabilitation of certain areas in the
City and has undertaken an economi development area in City; and
WHEREAS, on October 2, 1969, the Iowa City Cit Council adopted Resolution No. 2157
approving the City -University Project I U an Renewal Pin (Project No. IA R-14), which plan has
been modified and amended from time to ti e (said pl, as amended, is hereinafter referred to as
the "Urban Renewal Plan" or "Plan"); and
WHEREAS, a copy of the foregoing Ur an Renewal Plan, as amended, has been recorded
among the land records in the office of the Reco eX of Johnson County, Iowa; and
WHEREAS, the Developer owns or has the 'ght to occupy certain real property located in
the foregoing Urban Renewal Area at 328 S. Clinton treet, Iowa City, Iowa, as more particularly
described in Exhibit A annexed hereto and made a par hereof (hereinafter "the Property"); and
WHEREAS, the Developer desires construct\wh
-story, 144 -room hotel, as further
described in Exhibit D "Minimum Improvements and U(hereinafter, "the Project") on the
Property, and cause the same to be operatedfin accordancthis Agreement; and
WHEREAS, by Resolution No. 15- , datedNInclude
05, the Urban Renewal Plan for
the City -University Project I Urban Renevyal Area was amended a developer's agreement
for this Project as an Urban Renewal Projkct in furtherance of the go is and objectives of the Urban
Renewal Plan and the City's Comprehensive Plan
r
WHEREAS, the City has determined the Project is consistent 'th and authorized by the
Urban Renewal Plan and all applicable State and federal laws, including ut not limited to Iowa
Code Chapters 15A, 423A, and 403, a� well as the goals of the Downtown an Riverfront Crossings
Master Plan; and
WHEREAS, the City believesIthat the development and continued operation of the Property
pursuant to this Agreement and the fulfillment generally of this Agreement, are in the vital and best
2
interests of the City and in accord with the Urban Renewal Plan and the public purposes and
provisions of the applicable State and local laws and requirements under which the foregoing project
has been undertaken and is being assisted.
NOW, THEREFORE, in consideration of the premises and the mutual obligations of the
parties hereto, each of them does hereby covenant and agree with the other as follows:
ARTICLE I. DEFINITIONS
Section I.I. Definitions. In addtion to other definitions set forth in this greement, all
capitalized terms used and not otherwise efined herein shall have the followin eanings unless a
different meaning clearly appears from th context:
Agreement means this Agreement ,
from time to time modified, amended or
Certificate of Completion means a
Exhibit C and hereby made a part of this
3.2 of this Agreement.
all exhibits and appendicesyereto, as the same may be
City means the City of Iowa City, Iowa, 0,any
Code means the Code of Iowa, 2015, as
in the forin/f the certificate attached hereto as
)rovided,t6 the Developer pursuant to Section
to its functions.
Construction Plans means the plans, speofica ions, drawings and related documents reflecting
the construction work to be performed by the�Develo er on the Development Property and the other
properties upon which the Public Improvements will be located; the Construction Plans shall be as
detailed as the plans, specifications, dr4wings and r ated documents which are submitted to the
building inspector of the City as required by applicab City codes.
County means the County of -Johnson, Iowa.
Developer means Iowa City Hotel Associates, L.
r'
Development Propere means that portion of the Ci
of the City described in Exhibit A hereto.
Economic Development Grants mean the payments
under Article VIII of this Agreement.
Event of Default means any of the events described in
3
versity Project I Urban Renewal Area
be made by the City to the Developer
10.1 of this Agreement.
First Mortgage means any Mortgage granted to secure any loan made pursuant t either a
mortgage commitment obtained by the Developer from a commercial lender or other nancial
institution to fund any portion of the consx tion costs and initial operating capital requir ments of
the Minimum Improvements, or all sucfi Mortgages as appropriate.
328 CLINTON TIF Account me s a separate account within the City -Univ sity Project I
Urban Renewal Tax Increment Revenu Fund of the City, in which there shall be posited all Tax
Increments received by the City with re ect to the Minimum Improvements o the Development
Property described in Exhibit A, as well a 50% of any tax revenues collected suant to Iowa Code
Section 423A.7 solely from operation of e hotel constructed pursuant to is Agreement.
Minimum Improvements shall 0
approximately 144 -room Hilton Garden Im
amenities, as described in Exhibit B hereto.
assessed or actual value due to market facto
Mortgage means any mortgage or
mortgage or other security interest in the
any improvements constructed thereon.
in the construction of a 12 -story, steel -framed,
hotel, together with all elated site improvements and
v4inimum Immovem is shall not include increases in
Net Proceeds means any proceeds paid
policies of insurance required to be provided ai
pursuant to Article V of this Agreement and r
and disbursements of counsel) incurred in th,
Ordinance means Ordinance No.
taxable property in the City -University
paid into the City -University Project I'l
-3991 of
roj ect I Urb
rban Renev
in which the Developer has granted a
rty, or any portion or parcel thereof, or
insurer to the Developer under a policy or
tained by the Developer, as the case may be,
after deducting all expenses (including fees
of such proceeds.
City, under which the taxes levied on the
Renewal Area shall be divided and a portion
Tax Increment Revenue Fund.
Project shall mean the con�ruction. and operatic
Development Property, as described in this Agreement.
State means the State
of the Minimum Improvements on the
City created under the authority of Section 403.19(2) of the o
created in order to pay the principal of and interest on loans,:
whether funded, refunded, assumed or otherwise, including b
the authority of Section 403.9 or 403.12 of the Code, incurred
whole or in part projects undertaken pursuant to the City -Unit
as amended.
I
4
'und means the special fund of the
and the Ordinance, which fund was
,nies advanced to or indebtedness,
.s or other obligations issued under
the City to finance or refinance in
3ity Project I Urban Renewal Plan,
Tax Increments means the property trerthe
nues with respect to the Minim 'Improvements
that are divided and made available to theor deposit in the City -University roject I Urban
Renewal Tax Increment Revenue Fund unprovisions ofSection 403.19 o e Code and the
Ordinance.
Termination Date means the date ofgermination of this Agreement,established in Section
12.8 of this Agreement. '71
Unavoidable Delays means delays re ulting from acts o/thlan
ces outside the reasonable
control of the party claiming the delay inclu ing but not limited floods, fires, explosions or
other casualty losses, unusual weather condi ions, strikes, boycuts or other labor disputes,
delays in transportation or delivery of materi1 or equipment, limmenced by third parties,
or the acts of any federal, State or local goy ental unit (ote City).
Urban Renewal Plan means the City -
approved in respect of the City -University P
hereof.
314 CLINTON TIF Account means a
Urban Renewal Tax Increment Revenue Fund
in tax increments received by the City with res
1, 2016 assessed value once and for so long as
in Exhibit F ("the 314 S. Clinton Street pr
$500,000 in tax increments are generated e
ARTICLE II.
Section 2.1. Representa
representations and warranties:
rsity Pro' ct I Urban Renewal Plan, as amended,
I UrbaryRenewal Area, described in the preambles
e account within the City -University Project I
e City, in which there shall be deposited $250,000
to the increase in assessed value from the January
and and improvements on the property described
) reaches an assessed value of $18,600,000 and
The City makes the following
(a) The City is a municipal corporation 4d political subdivision organized under the
provisions of the Constitution and the laws of the State and has the power to enter into this
Agreement and carry out its obligations hereunder.
(b) The exec#ion and delivery of this Agre ent, the consummation of the transactions
contemplated hereby and the fulfillment of orcompli ce with the terms and conditions of this
Agreement are not/Prevented by, limited by, in conflic with, or result in a breach of, the terms,
conditions or provisions of any contractual restriction, evidence of indebtedness, agreement or
instrument of whatever nature to which the City is now a arty or by which it is bound, nor do they
constitute a default under any of the foregoing.
Section 2.2. Covenants, Obligations, Repre,
Developer makes the following representations and
5
The
(a) Developer is a Iowa corporation ly organized and validly existing under the laws of
the State of Iowa and has all requisite power anp authority to own and operate its properti to carry
on its business as now conducted and as pres tly proposed to be conducted, and to a er into and
perform its obligations under the Agreement. If
(b) This Agreement has been duly d validly authorized, executed delivered by the
Developer and, assuming due authorization, c xecution and delivery by the Ci , is in full force and
effect and is a valid and legally binding instrui nent of the Developer enforce le in accordance with
its terms, except as the same may be limited b bankruptcy, insolvency, r ganization or other laws
relating to or affecting creditors' rights gener lly.
(c) The execution and delivery of tl
contemplated hereby, and the fulfillment of
Agreement are not prevented by, limited by, iY
terms, conditions or provisions of the certifi
parents or subsidiaries of any contractual i
instrument of whatever nature to which the Di
bound, nor do they constitute a default under
(d) There are no actions, suits or pros
Developer in any court or before any arbitrator
is a reasonable possibility of an adverse decis'
(present or prospective), financial position r
manner raises any questions affecting th val
perform its obligations under this Agre ent.
Agreement, the c summation of the transactions
compliance wit the terms and conditions of this
)nflict with, o esult in a violation or breach of, the
e of incorp ation and bylaws of Developer or its
riction, dence of indebtedness, agreement or
Doper i now a party or by which it or its property is
y of e foregoing.
flings pending or threatened against or affecting the
before or by any governmental body in which there
vhich could materially adversely affect the business
zlts of operations of the Developer or which in any
ty of the Agreement or the Developer's ability to
(e) Developer has not rec Ned any notil
activities of Developer with respeto the Develo
environmental law or regulation/(other than thos(
been notified in writing). Developer is not Curr(
planned to be filed by any pariy relating to any vio
law, regulation or review procedure applicable to
currently aware of any v'olation of any local, S
review procedure whi would give any per,
environmental statute/ivith respect thereto.
(f) Dev oper will cooperate with the
removal, excessi a noise or public safety prof
construction and operation of the Minimum Impi
C1
e from any local, State for federal official that the
iment Property may or will be in violation of any
notices, if any, of which the City has previously
fitly aware of any State or federal claim filed or
Ettion of any local, State or federal environmental
:he Development Property, and Developer is not
ito or federal environmental law, regulation or
n a valid claim under any State or federal
in resolution of any traffic, parking, trash
which may arise in connection with the
(g) Developer would not undertake its obligations under this Agreement without the
payment by the City of the Economic Development Grants being made to the Developer pursuant to
this Agreement.
1
(h) The Developer will causethe Minimum Improvements to be cons cted in accordance
with the terms of this Agreement and w en constructed will comply with therban Renewal Plan
and all local, State and federal laws and egulations, except for variances t t may be necessary to
construct the Minimum Improvements.
(i) The Developer will use its
manner, all required permits, licenses a
requirements of all applicable local, State,
or met in connection with the Project.
(j) The Developer shall not, prior
permit the Development Property and/or N
property by applying for or seeking any in(
utility or any other entity of a type where the
treated as located within the Development Pi
status or by applying for or seeking for a
pursuant to any present or future statute or c
ARTICLE III. D
Section 3.1.
efforts to obtain, or cau a to be obtained, in a timely
approvals, and will eet, in a timely manner, all
l federal laws and remUlations which must be obtained
he expiratio of this agreement, cause or voluntarily
Imum
Imp vements to become other than taxable
tax exemption, by being owned by a
alue of taxable property of such entity is not
being owned by any entity having tax exempt
abatement or exemption from property tax
The Developer agrees to cofiplete theMini um Improvements generally consisting of
construction of a 12 -story Hilton G;'rden Inn hotel wi 144 bedrooms, a meeting/event center, a roof
top food and beverage venue, a re.9taurant, and a pool/s a/fitness area, all as described more fully on
Exhibit B ("Minimum Improvements") attached heret and incorporated herein by this reference.
The Redeveloper hereby conminits to a Project that in udes a minimum total of $33,205,936 in
project costs. By January 1, 2018, the construction of the inimum Improvements must increase the
actual assessed value of the Development Property to at east $15,120,000.
Section 3.2. Certificate of Completion.
Upon written,,request of the Developer after issuance
Improvements, the City will furnish the Developer with a C
the form set forth in Exhibit C attached hereto. Such Certif
determinatio"f satisfactory termination of the covenants
with respect/to the obligations of the Developer to cc
Improvem�ts.
7
an occupancy permit for the Minimum
tificate of Completion in substantially
,te of Completion shall be a conclusive
d conditions of this Agreement solely
eruct such portion of the Minimum
A Certificate of Completi
and other instruments pertainin tc
City shall refuse or fail to provi
this Section 3.2, the City shall
provide the Developer with a wri
Developer has failed to complete t
this Agreement, or is otherwise in
acts will be necessary in the opini
Section 5.1.
may be recorded in the proper office for the recordation of deeds
the Development Property at the Develo er's sole expense. If the
a Certificate of Completion in accord ce with the provisions of
-ithin twenty (20) days afte/wn request by the Developer,
en statement indicating with detail, in what respects the
e Minimum Improvementsance with the provisions of
d fault under the terms of thent, and what measures or
on of the City, to obtain sucate of Completion.
WV
ARTICLE V.
(a) Upon completion of constr
to the Termination Date, the Developer
expense (and from time to time at the:
premiums on) insurance as follows:
rthe Minimum Improvements and at all times prior
Maintain, or cause to be maintained, at its cost and
of the City shall furnish proof of the payment of
(i) Insurance against ss d/o
policy or policies covering such risks are or in,
by similar businesses, including (wi out limi ti
coverage, vandalism and malicio mischief, i
removal, and collapse in an unt not less tl
Minimum Improvements, but y such policy .
$250,000. No policy of insurpfice shall be so wri
the minimum coverage required by the preceding
otherwise, without the p�or consent thereto in
replacement value" shall mean the actual rep
(excluding foundation,,and excavation costs and c
uninsurable items) aria equipment, and shall be d
City, but not more,,/frequently than once every tl
selected and paid,ior by the Developer and apprc
damage to the Minimum Improvements under a
ily insured through property policies against risk
n the generality of the foregoing) fire, extended
>losion, water damage, demolition cost, debris
in the full insurable replacement value of the
ay have a deductible amount of not more than
,n that the proceeds thereof will produce less than
entence, by reason of co-insurance provisions or
riting by the City. The term "full insurable
ement cost of the Minimum Improvements
s of underground flues, pipes, drains and other
t ined from time to time at the request of the
•e years, by an insurance consultant or insurer
ed y the City.
Vi) Comprehensive general public H
liability for i�juries to persons and/or property, includi
automobile,6 or other motorized vehicles on or about
amount f ' each occurrence and for each year of $1,0
(iii) Such other insurance, including we
employees of the Developer, in such amount as is custi
ility insurance, including personal injury
7 any injuries resulting from the operation of
Development Property, in the minimum
compensation insurance respecting all
y carried by like organizations engaged
in like activities of comparable size and I ability exposure; provided that the Developer ay be self-
insured with respect to all or any part o 'ts liability for worker's compensation.
(b) All insurance required by t 's Article V to be provided prior to the ination Date
shall be taken out and maintained in res onsible insurance companies selecte y the Developer
which are authorized under the laws of th State of Iowa to assume the risks vered thereby. The
Developer will deposit annually with the ity copies of policies evidencing 1 such insurance, or a
certificate or certificates or binders of the spective insurers stating that ch insurance is in force
and effect. Unless otherwise provided in th s Article V, each policy shall ntain a provision that the
insurer shall not cancel or modify it
twit
giving written notice to a Developer and the City at
least thirty (30) days before the cancellation r modification become effective. Not less than fifteen
(15) days prior to the expiration of any p licy, the Developer all furnish the City evidence
satisfactory to the City that the policy has be renewed or repla d by another policy conforming to
the provisions of this Article V, or that there no necessity th efor under the terms hereof. In lieu
of separate policies, the Developer may maint in a single po cy, or blanket or umbrella policies, or a
combination thereof, which provide the total c verage re fired herein, in which event the Developer
shall deposit with the City a certificate or cert cates o e respective insurers as to the amount of
coverage in force upon the Minimum Improv ents.
(c) The Developer agrees/loper
y th
damage exceeding $250,000 in amor
portion thereof resulting from fire .c u
paid directly to the Developer, and open
Minimum Improvements to substansame
prior to the event causing such dad, to
reconstruction and restoration, the Dr willsuch damage received by the Develhe pa
zity as soon as reasonably possible in the case of
itruction of, the Minimum Improvements or any
ty. Net Proceeds of any such insurance shall be
will forthwith repair, reconstruct and restore the
r an improved condition or value as they existed
te extent necessary to accomplish such repair,
3 ly the Net Proceeds of any insurance relating to
ent or reimbursement of the costs thereof.
(d) The Developer s1*11 complete the r air, reconstruction and restoration of the
Minimum Improvements, whe�fier the Net Proceeds o insurance received by the Developer for such
purposes are sufficient.
AR)ftCLE VI. COVENANTS O THE DEVELOPER
Section 6.1. D aintenance of Properties. The D eloper will maintain, preserve and keep
the Minimum ImprOements in good repair and working o der, ordinary wear and tear accepted, and
from time to time will make all necessary repairs, replac ents, renewals and additions.
Section 6X2. Maintenance of Records. The Develop r will keep at all times proper books of
record and a ount in which full, true and correct entriwill be made of all dealings and
transactions � or in relation to the business and affairs oV the Developer in accordance with
generally accepted accounting principles, consistently appliedthroughout the period involved, and
0
the Developer will provide reasonable
account.
Section 6.3.
with
regulations relating to the Minimum Ir
to comply with which or the sanctions
adverse effect on the business, prope
Developer.
Section 6.4.
shall not discriminate against any applid
religion, sex, national origin, sexual orienti
Developer shall ensure that applicants, eml
regard to their race, creed, color, religion,
marital status or gender identity.
Section 6.5. RESERVED.
ection against loss or damage to such books of record and
vs. The Developer will comply w' h all laws, rules and
vements, other than laws, rules regulations the failure
penalties resulting therefrom, w uld not have a material
operations, or condition, fin cial or otherwise, of the
In operating theMinim Improvements, the Developer
int, employee or ten because of race, creed, color,
ion, age, disabilityr tal status or gender identity. The
oyees and tenantsnsidered and are treated without
x, national ori 'ual orientation, age, disability,
Section 6.6. Annual Certification. To a sisl
Developer hereunder, a duly authorized officer f
(a) proof that all ad valorem taxes on the Devel r.
year; and (b) certification that such officer has x
and that at the date of such certificate, and t e D
twelve (12) months, in default in the fulfill ent o
and that no Event of Default (or event w ich, with
would become an Event of Default) is ccurring or
during such period, or if the signer ' aware of an
officer shall disclose in such statem�nt the nature tl
any, has been taken or is pr
certificate shall be provided
2017, and ending on November 1, 2038, both dates ij
on or before November L, 2017, the City will cc
Development Propertyan the 314 S. Clinton Street
to be taken wi
later than
ie City in monitoring and performance of the
Developer shall annually provide to the City:
nt Property have been paid for the prior fiscal
ted the terms and provisions of this Agreement
oper is not, and was not during the preceding
V of the terms and conditions of this Agreement
lapse of time or the giving of notice, or both,
is occurred as of the date of such certificate or
such default, event or Event of Default, said
-eof, its period of existence and what action, if
respect thereto. Such statement, proof and
1 of each year, commencing November 1,
i usive. Upon certification by the Developer
t to establish a base value for both the
Section 6.7 Quarterly Certification. Prior to dis�
from the 328 CLI06N TIF Account deposited therein
Iowa Code Sectioi�423A.7 and this Agreement, Develol
proof that all ho el -motel taxes on the Development Pi
Section 423A.ave been paid for the prior quarter; aj
examined they erms and provisions of this Agreement and
Developer i not, and was not during the preceding twelve
of any oft a terms and conditions of this Agreement and 1
with the lkp§e of time or the giving of notice, or both,
10
as of January 1, 2016.
ation to the Developer of any amounts
a result to taxes collected pursuant to
shall quarterly provide to the City: (a)
erty collected pursuant to Iowa Code
(b) certification that such officer has
tt at the date of such certificate, and the
months, in default in the fulfillment
L no Event of Default (or event which,
o Id become an Event of Default) is
occurring or has occurred as of the date of such certificate or during such pe 'o , or if the signer is
aware of any such default, event or ent of Default, said officer shall disclose i such statement the
nature thereof, its period of exist ce and what action, if any, has /be
or is proposed to be
taken with respect thereto. Such tatement, proof and certificate vided not later than
January 31, April 30, July 31, and November 1 of each year, comuary 31, 2017, and
ending on November 1, 2038, both ates inclusive. This quarterly chall be in a form set
forth in Exhibit E hereto. The Partie acknowledge that the Annual n, the form of which
is set forth in Exhibit D hereto, ay be filed in satisfaction ember 1 Quarterly
Certification obligation.
Section 6.8 Taxation of Develdom
expiration of this agreement, cause or vol 1
Improvements to become other than taxa 1,
exemption, by being owned by a utility or
taxable property of such entity is not treated
owned by any entity having tax exempt statu
or exemption from property tax pursuant to
ARTICLE VII.
it Property. The eveloper shall not, prior to the
rily permit the D elopment Property and/or Minimum
property by a lying for or seeking any property tax
iy other ent' of a type where the assessed value of
is located ithin the Development Property, by being
r by ap ying for or seeking for a deferral, abatement
v vre ent or future statute or ordinance.
TRANSFER
Section 7.1. Status of the Developer; ans r of Substantially All Assets. As security for the
obligations of the Developer under this Agreement, the Developer represents and agrees that, prior to
the issuance of the Certificate of Complgtion and p 'or to the Termination Date, the Developer will
maintain existence as an adequately-Opitalized c oration and will not wind up or otherwise
dispose of all or substantially all of 'the Developme t Property and Minimum Improvements, or
assign its interest in this Agreement to any other arty unless (i) the transferee partnership,
corporation, limited liability company or individual as umes in writing all of the obligations of the
Developer under this Agreement' and (ii) the City cons is thereto in writing in advance thereof, in
which case the Developer may be released of its ob 'gations hereunder. Notwithstanding the
foregoing, however, or any other provisions of this A eement, (a) Developer may transfer its
interest in and to this Agreement to any affiliate which is ntrolled by, under common control with
or controls Developer or' to any entity that acquires al or substantially all of the assets of the
Developer or to any corporate successor to Developer by solidation, merger, or otherwise, and (b)
the Developer may (1),pledge any and/or all of its assets or s right to payment under this agreement
as security for any financing of the Minimum Improve ents; (2) assign its rights under this
f
Agreement to a third party, provided such assignment s all not release the Developer of its
obligations here er, and the City agrees in writing that De loper may assign its interest under this
Agreement for s ch purpose; and (3) the Developer may tr sfer its ownership interest to a third -
party under anarrangement whereby Developer will lease he Development Property back and
continue to sa4sfy the requirements of this Agreement.
ARTICLE VIII.
11
Section 8. 1. Economic Development Grants.
(a) For and in consideration the obligations being assumed by the D veloper hereunder,
and in furtherance of the goals and o jectives of the Urban Renewal Plan the Urban Renewal
Act, the City agrees to make up tot enty--one (21) annual Economic De v lopment Grants to the
Developer, subject to the Developer aving received a Certificate of C mpletion and being and
remaining in compliance with the tI;an
of this Agreement and subjec o the terms of this Article
VIII. The total, aggregate amount oconomicDevelopment Gr s under this Agreement shall
not exceed $8,800,000. The annuals shall commence on June , 2020 and end on June 1, 2040,
or when the total of all grants is equal to V8,800,000, whicheverfs earlier.
to:
Unless the total grant amount of $8 800,000 is reached first, all annual grants shall be equal
(i) one hundred percent (100%) per
with respect to the Minimum Impro
403.9 of the Urban Renewal Act ui
averaging that may otherwise be ut:
that may accrue thereon prior to pa
month period in respect of the Deve
subject to adjustment and conditio
being referred to collectively as tl
(ii) 50% per fiscal year of any/d all reve
the taxes collected by the Cify pursuant to
year/f the Tax Increments collected by the City
Its n Development Property pursuant to Section
erms of the Ordinance (without regard to any
under Section 403.19 and excluding any interest
to the Developer) during the preceding twelve-
nt Property and the Minimum Improvements, but
d nent as provided in this Article (such payments
ic Development Grants"); and
(iii) At such time as the roperty locally k
and legally described ii) xhibit F attached
said property reaches 18,600,000 and the
value, the City shall make an economic c
$250,000 per fi �rl year of the tax incri
Account.
generated solely by the Project arising from
i Code Section 423A.7 (2015), and
The final Granf shall be adjusted, if necessary, if
would result in total, aggregate Economic Development
as 314 S. Clinton Street, Iowa City, Iowa,
has been developed, the assessed value of
rty taxes are actually paid on this assessed
ment grant to Developer a maximum of
deposited into the 314 CLINTON TIF
of the above-described amounts
exceeding $8,800,000.
(b) Thi obligation of the City to make an EconomDevelopment Grant to the Developer
in any year asxpecified above shall be subject to and con itioned upon the timely filing by the
Developer of /all previous annual statements, proofs and ce'fications required under Section 6.6
hereof and t e City Manager's approval thereof, which will not a unreasonably withheld. Beginning
with the N ember 1, 2018 certification, if the Developer's al statement, proof and certification
is timely filed and contains the information required underection 6.6 and the City Manager
approves of the same, the City shall certify to the Johnson Coun Assessor (the "County") prior to
12
December 1 of that year its request for the available Tax Increments resulting from the assessments
imposed by the County as of January 1 of that year, to be collected by the City 's taxes are paid
during the following fiscal year and which shall thereafter be disbursed to the Dev Loper on June 1 of
the following fiscal year. (For exam , if the Developer and the City each so ify on November
and December 2018, respectively, t e first Economic Development Grant ould be paid to the
Developer on June 1, 2020). With re ect to any grant made from the 314 C INTON TIF Account,
once the 314 S. Clinton Street prop has an assessed value of at least $1 ,600,000, the City shall,
in its certification to the Johnson Co ty Assessor, request that the tax i rement resulting from the
assessments imposed by the County a of January 1 of that year, to be ollected by the City as taxes
are paid during the following fiscal ye and which shall thereafter b disbursed to the Developer on
June 1 of the following fiscal year. The obligation of the City to ake any grant from this funding
source is subject to and conditioned upo the generation of at le t $500,000 in tax increment from
that property.
(c) In the event that the annual s tement, proof r certificate required to be delivered by
the Developer under Section 6.7 is not d ivered to e City by November 1 of any year, the
Developer recognizes and agrees that the Ci may ha insufficient time to review and approve the
same and certify its request for Tax Increme is to e County and that, as a result, no Economic
Development Grant may be made to the Deve pe in respect thereof. The City covenants to actin
good faith to appropriately review and consid y late certification on the part of the Developer,
but the City shall not be obligated to make certification to the County for the available Tax
Increments or make any corresponding p nt of the Economic Development Grant to the
Developer if, in the reasonable judgment o the 'ty, it is not able to give appropriate consideration
mite
(which may include, but not be lid , speci discussion before the City Council at a regular
City Council meeting with respect they to) to the eveloper's certification due to its late filing. In
the event Developer fails to timel file an ann al statement, proof or certificate due to an
Unavoidable Delay and, as a resul an Economic velopment Grant cannot be made, Developer
may give written notice to the qty and, if the Ci finds that Developer's failure is due to an
Unavoidable Delay, the missed conomic Developme t Grant shall be made in the year succeeding
the last scheduled Economic evelopment Grant and Section 8. 1, subject to Developer's filing
under Section 6.6 and all o provisions of this Article VIII with respect to such grant, it being the
intention of the parties to allow up to 21 annual Econo is Development Grants in an aggregate
amount not to exceed $ ,800,000, if Developer is in com liance with this Agreement.
(d) Such Eco omic Development Grants shall at 1 times be subject to termination in
accordance with t terms of this Article VIII and Article . Thereafter, the taxes levied on the
Development Pr erty and Minimum Improvements shall be vided and applied in accordance with
the Urban Ren al Act and the Ordinance. It is recognized b all parties that the total aggregate
amount set fo h above is a maximum amount only and that th actual payment amounts will be
determined after the Minimum Improvements are complet and the valuations of said
Improvem is have been determined by the City Assessor.
13
(e) In the event that any
information available to the City dis
that was not cured or cannot reason
that, with the passage of time or giv
cannot reasonably be cured under th
thereafter to make any further paymi
Grants and may proceed to take one
✓ftificate filed by the Developer under c
loses the existence or prior occurrence of
ily be cured under the provisions of Sectio
ig of notice, or both, would become an
provisions of Section 10.2), the City s 1
is to the Developer in respect of the cor
more of the actions described in ctio
tion 6.6 or other
Event of Default
10.2 (or an event
-ent of Default that
have no obligation
)mic Development
10.2 hereof
Section 8.2. Source of Grant Fun4 s Limited. (a) The Economi evelopment Grants shall be
payable from and secured solely and onl by amounts deposited and,eld in the 328 CLINTON TIF
Account and the 314 CLINTON TIF Acc unt of the City. The Ci hereby covenants and agrees to
maintain the Ordinance in force during th term hereof and to a ly the incremental taxes collected
in respect of the Minimum Improvements d allocated to the 28 CLINTON TIF Account and the
314 CLINTON TIF Account to pay the Eco omic Develop t Grants, as and to the extent set forth
in Section 8.1 hereof. The Economic Devel pi
Grant hall be payable only from those sources
described in Section 8.1 hereof, and not in y manner b other tax increment revenues, by general
taxation, or from any other City funds.
(b) Notwithstanding the provisions df S,
to make an Economic Developme/eree
o th
City receives an opinion of its lsel r
jurisdiction over the subject matteo t e i
the Minimum Improvements to concontemplated under said Section authorpermitted to be undertaken by the er the Lof the Code, as then constitutedreceiptpromptly forward a copy of the se Dev
tion 8.1 hereof, the City shall have no obligation
,eveloper if at any time during the term hereof the
a controlling decision of an Iowa court having
fect that the use of Tax Increments resulting from
mic Development Grant to the Developer, as
zed or otherwise an appropriate project activity
ban Renewal Act or other applicable provisions
f such an opinion or decision, the City shall
;l er. If the circumstances or legal constraints
giving rise to the opinion or decion continue fo a period during which two (2) Economic
Development Grants would othe ise have been pai to the Developer under the terms of Section
8.1, the City may terminate this Agreement, without nalty or other liability to the Developer, by
written notice to the Developef.
(c) The City makes representation with respec to the amounts that may finally be paid to
the Developer as the Eco _in
Development Grants, an under no circumstances shall the City in
any manner be liable to a Developer so long as the City ti ely applies the Tax Increments actually
collected and held in the 328 CLINTON TIF Account (r ardless of the amounts thereof) to the
payment of the Eco mic Development Grants to the Devoper, as and to the extent described in
this Article.
Section 8.3. Use of Other Tax Increments. Subject to thiN Article VIII, the City shall be free to
use any and all ax Increments collected in respect of increas in valuation on the Development
Property unrel ted to construction of the Minimum Improvement (i.e. increases in assessed or actual
value due to arket factors), any other properties within the P .ect Area, or any available Tax
14
Increments resulting from the suspension or termination of the Economic Development Grants under
Section 8.1 hereof, for any purpose fo ' which the Tax Increments may lawfully be used pursuant to
the provisions of the Urban Renewa Act, and the City shall have no obligati onys to the Developer
with respect to the use thereof. /
ARTIC�E IX. INDEMNIFICATION
Section 9.1.
(a) The Developer releases the
servants and employees thereof (herein
parties") from, covenants and agrees that
indemnify, defend and hold harmless the
or any injury to or death of any person
Minimum Improvements.
City and the governing b9dy members, officers, agents,
.fter, for purposes of t10 Article IX, the "indemnified
e indemnified parties all not be liable for, and agrees to
1 emnified parties apfiinst, any loss or damage to property
c urring at or abo t or resulting from any defect in the
(b) Except for any willful misrepre e:
unlawful act of the indemnified parties, the De
and defend the indemnified parties, now or fore
harmless, from any claim, demand, suit, action
entity whatsoever arising or purportedly ansin
of this Agreement (except with respect to s
the Developer against the City to enforVd
ril
condition of the Development Propertye
of the Minimum Improvements or (iii any
located in or on the Development P operty
effective date of this Agreement.
:io r any willful or wanton misconduct or any
)et, or its successors or assigns, agrees to protect
d further agrees to hold the indemnified parties
other proceedings whatsoever by any person or
n (i) any violation of any agreement or condition
action, demand or other proceeding brought by
under this Agreement), (ii) the acquisition and
truction, installation, ownership, and operation
us substance or environmental contamination
i to conditions caused by Developer after the
(c) The indemnified arties shall not be liab for any damage or injury to the persons or
property of the Developer or i officers, agents, servant or employees or any other person who may
be on or about the Minimu Improvements due to any ct of negligence of any person, other than
any act of negligence on a part of any such indemnifi party or its officers, agents, servants or
employees.
(d) All co nants, stipulations, promises, agreem nts and obligations of the City contained
herein shall be de ed to be the covenants, stipulations, pro ises, agreements and obligations of the
City, and not of y governing body member, officer, agent servant or employee of the City in the
individual capa itv thereof.
(e) /The provisions of this Article IX shall survive
ARTICLE X. DEFAULT AND RENS
15
termination of this Agreement.
IES
Section 10. 1. Events of Default Defined. The following shall be "Events of Default" under
this Agreement and the term "Event of Default" shall mean, whenever it is used in this Agreement,
any one or more of the following events:
(a) Failure by the Developer , o cause the construction of the Minim Improvements to be
commenced and completed pursuant o the terms, eonditions and limitatio s of Article III of this
Agreement;
(b) Transfer of any interest in t 's Agreement or the assets of a Developer in violation of
the provisions of Article VII of this Agre ent;
(c) Failure by the Developer to su tantially observe o erform any covenant, condition,
obligation or agreement on its part to be obs ed or perform under this Agreement;
(d) If the holder of any Mortgage on he Deve pment Property, or any improvements
thereon, or any portion thereof, commences forec sure oceedings as a result of any default under
the applicable Mortgage documents;
(e) If the Developer shall:
(A) file any petition in
composition, readjustment, liquidation,
Bankruptcy Act of 1978, as amended, or t
(B)
(C)
make an
:ruptc or for any reorganization, arrangement,
lution, r similar relief under the United States
any sim lar federal or state law; or
for the benefitlpf its creditors; or
admit in writip'g its inability to pay its debts generally as they become due; or
(D) be adjudicafed a bankrupt or insolvent or if a petition or answer proposing the
adjudication of the Developer s a bankrupt or its reorganiza ion under any present or future federal
bankruptcy act or any simil federal or state law shall be led in any court and such petition or
answer shall not be dischar ed or denied within ninety (90) da after the filing thereof; or a receiver,
trustee or liquidator of t e Developer or the Minimum Imp ovements, or part thereof, shall be
appointed in any proce ings brought against the Developer, and shall not be discharged within
ninety (90) days after ch appointment, or if the Developer s all consent to or acquiesce in such
appointment; or
(f) 'fan representation or warranty made by the Develer in this Agreement, or made by
the Developer in y written statement or certificate furnished b the Developer pursuant to this
Agreement, sha prove to have been incorrect, incomplete or misl ding in any material respect on
or as of the da of the issuance or making thereof.
16
(g) Notwithstanding anything to the contrary, however, in the event of an Event of Default
pursuant to subparagraphs (d) or (e) above, a Mortgagee who has received an assignment of the
Developer's rights pursuant to this Agreement as security as contemplated by Section 7.1(b) above,
shall have the right, at its option and subject to written agreement with the Cii� to expressly assume
the Developer's obligations to the Ci "pursuant to this Agreement. In said *.ent, said Mortgagee
shall be substituted as the Developer for the remainder of the term of this greement, the default
shall be deemed cured, and the parties shall continue to be bound hereby.
Section 10.2.
Whenever any Event of Default referred to in Section
10.1 of this Agreement occurs and is co inuing, the City, as specifie below, may take any one or
more of the following actions after (exc t in the case of an Event o efault under subsections (d)
or (e) of said Section 10.1 in which case atior.
days' written notice by the City to the Devel pe
extent the City has been informed in writing f
with the address of the holder thereof) of the
not been cured within said thirty (30) days, o
within thirty (30) days and the Developer does
City that the Event of Default will be cured as
may be taken imm iately) the giving of thirty (30)
r and the holder o K First Mortgage (but only to the
the existencXbf
First Mortgage and been provided
vent of Defut only if the Event of Default has
if the Evenefault cannot reasonably be cured
kt providyassurances reasonably satisfactory to the
on as y6asonably possible:
(a) The City may suspend its perfoi
assurances from the Developer, deemed adequate
and continue its performance under this Agree
(b) The City may terminate this
(c) The City may withhold
face under this Agreement until it receives
the City, that the Developer will cure its default
Completion;
(d) The City may take any tion, including 1 gal, equitable or administrative action, which
may appear necessary or desirabl to enforce perfo ance and observance of any obligation,
agreement, or covenant of the D eloper, as the case ay be, under this Agreement; or
(e) The City shall b entitled to recover from th Developer, and the Developer shall re -pay
to the City, an amount equal o the most recent Economic evelopment Grant previously made to the
Developer under Article V II hereof, and the City may tak any action, including any legal action it
deems necessary, to rec er such amount from the Develo er.
Section 10.3. o RemedyExclusive. No remedyhere
is intended to be lusive of any other available remedy or
shall be cumulati a and shall be in addition to every other r
now or hereafte existing at law or in equity or by statute. No
or power acc ng upon any default shall impair any such right
waiver there f, but any such right and power maybe exercised
be deemed xnedient.
17
krred upon or reserved to the City
ies, but each and every remedy
given under this Agreement or
dor omission to exercise any right
wer or shall be construed to be a
time to time and as often as may
Section 10.4. No Implied Waiver. In the event any agreement contained in this Agreement
should be breached by any party and thereafter waived by any other party, such waiver shall be
limited to the particular breach so waived and shall not be deemed to waive a' other concurrent,
previous or subsequent breach )ereunder.
Section 10.5.
Default occurs and the party w
the collection of payments d
observance of any obligation o.
party in default agrees that it shy
fees of such attorneys and such
the party not in default in conn
is not in default shall employ at1
or to become due or for the
agreement on the part of the par
1, on demand therefor, pay tF
`ther expenses as may be re
Ilion therewith.
ARTICLE XI.
;es. Whenever any Event of
ter incur other expenses for
ment or performance or
. default herein contained, the
y not in default the reasonable
and appropriately incurred by
Section 11.1. Qption to Termin te. This Agroment may be terminated by the Developer if (i)
the Developer is in compliance wita a Tms of this Agreement and no Event of Default
has occurred which has not been cured i accord ce with the provisions of Section 10.2 hereof; and
(ii) the City fails to comply with any mat al t of this Agreement, and, after written notice by the
Developer of such failure, the City has fai a to cure such noncompliance within thirty (30) days of
receipt of such notice, or, if such noncom p ance cannot reasonably be cured by the City within thirty
(30) days of receipt of such notice, the as not provided assurances reasonably satisfactory to
the Developer that such noncomplian will be cured as soon as reasonably possible.
Section 11.2. Effect of Ter nation. If is Agreement is terminated pursuant to this Article
XI, this Agreem/shabell be fro uch date fo and null and void and of no further effect; provided,
however, that ths rights indemnificatio under Article IX hereof shall in all events survive
and provided fuat the rmination of this greement shall not affect the rights of any party to
institute any actaim r demand for damag s suffered as a result of breach or default of the
terms of this Agrt another party, or to rec ver amounts which had accrued and become due
and payable as to of such termination. any such action, the prevailing party shall be
entitled to recovasonable attorneys fees and r ated expenses incurred in connection therewith
(but only, in thef the City, to the extent perm ed by applicable law). Upon termination of
this Agreementant to this Article XI, the veloper shall be free to proceed with the
construction andtion of the Minimum Improve nts at its own expense and without regard to
the provisions y(f this Agreement.
1E
ARTICLE XII. MISCELLANEOUS
Section 12.1. Conflict of Interest. The Developer represents and warrants that, to its best
knowledge and belief after due inquiry, no officer or employee of the City, or its designees or agents,
nor any consultant or member of
City who exercises or has exerci
during his or her tenure, or who is
insider information with regard to
any contract or subcontract, or t]
connection with the Project, or in
any time during or after such persi
governing body of the City, and no other public official of the
any functions or responsibilities with respect to the Project
a position to participate in a decision-/tbe
ocess or gain
;Project, has had or shall have any interdior indirect, in
proceeds thereof, for work or servicperformed in
activity, or benefit therefrom, which the Project at
s tenure.
Section 12.2. Notices and Dem ds. A notice, demand or othe communication under this
Agreement by any party to the other sh 1 be sufficiently given or livered if it is dispatched by
registered or certified mail, postage prep 'd, return receipt reques d, or delivered personally, and
(a) In the case of the De eloper, to 2 Qua' Creek Circle, North Liberty, Iowa,
52317, Attn: Ben Kinseth;
(b) In the case of the City, to ity H , 410 E. Washington Street, Iowa City, Iowa,
52240, Attn: City Manager;
or to such other designated individual or to su51f ether address as any party shall have furnished to
the other in writing in accordance herewith. � \
Section 12.3. Titles of Articles a d Sections. Any titles of the several parts, Articles, and
Sections of this Agreement are inserte for convemen a of reference only and shall be disregarded in
construing or interpreting any of its rovisions.
Section 12.4. Counte . This Agreement may a executed in any number of counterparts,
each of which shall constitute one and the same instrum t.
Section 12.5. Gowgifing Law. This Agreement shall a governed and construed in accordance
with the laws of the St a of Iowa.
Section 12.6 Entire Agreement. This Agreement an the exhibits hereto reflect the entire
agreement betwe n the parties regarding the subject matter he eof, and supersedes and replaces all
prior agreeme s, negotiations or discussions, whether oral or tten. This Agreement may not be
amended ex t by a subsequent writing signed by all parties h reto.
Sec on 12.7. Successors and Assigns. This Agreement is ntended to and shall inure to the
benefit o and be binding upon the parties hereto and their respec 've successors and assigns.
19
Section 12.8. Termination Date. This Agreement shall terminate and be of no further force or
effect on and after June 1, 2040, or upon final payment of the Economic Development Grants,
whichever is sooner.
IN WITNESS WHEREOF, the City has caused this Agreement t be duly executed in its name
and behalf by its Mayor Ind its seal to be hereunto duly affixed and ttested by its City Clerk, the
Developer has caused tNs Agreement to be duly executed in ' s name and on its behalf by
(SEAL)
ATTEST:
By:
City Clerk
I HOT
By:
STATE OF IOWA
ASSOCIATES
COUNTY OF JOHNSON
On this _
for said County, p
known, who being
City of Iowa City, I
Iowa, and that the s
and that said instru
and resolution of it
the free act and d(
CITY OF IOWA/CITY, IOWA
by:
Attorney
OF IOWA CITY
Tay of , 20_, before me a Notary Public in and
rson7f ly appeared MattheMirily
e and Marian K. Karr, to me personally
luly sworn, did say that thyor and City Clerk, respectively of the
w , a Municipal Corporated a existing under the laws of the State of
affixed to the foregoingnt is t e seal of said Municipal Corporation,
lent was signed and sealedf of sai Municipal Corporation by authority
City Council and said Maity Clerk cknowledged said instrument to be
I of said Municipal Corpoit volunt rily executed.
Notary Public in and
20
the State of Iowa
STATE OF
COUNTY OF
This instrument
21
by
A
The Development Property is described s consisting of all tha 'certain parcel or parcels of
land located in the City of Iowa City, County f Johnson, Stat/ofI a, locally known as 328 S.
Clinton Street, and more particularly described s follows:
The South 36 feet of Lot 6 and the North 44 feet f Lot 5, in Bin the Original Town of
Iowa City, Iowa, according to the plat recorded t ereof.
22
0114011:188
The Developer agrees to co plete Minimum
$33,206,000 project costs in makin improvements t
Iowa City, Iowa, which improveme is shall include
building. This building shall be com rised of two (2)
square foot event and meeting r m space, a
pool/spa/fitness area; ten (10) stories fhotel roo ,
rooftop food and beverage venue.
The Developer shall enter into a 6.
if in the future a Hilton Garden Inn fran
approved by the City, which approval s
participate in Hilton's LightStay sustaina
designate an employee or committee dedica
projects to improve performance at their h
said programs. The Developer shall coor n
construction strategies and operational tra
output and water usage. The project sh The
standards for energy management, and
management and quality manageme t, and
Any site plan for the Project ust be a
Imp ovements generally consisting of at least
o e property located at 328 S. Clinton Street,
th construction of a 12 -story, steel -framed hotel
ories for a hotel lobby, an approximate 2,500
estaurant, 24-hour business center, and a
for a total of approximately 144 rooms; and a
greement with the Hilton Garden Inn franchise or,
no longer available, a comparable hotel franchise
.ot be unreasonably withheld. The Developer shall
y measurement program and Hilton's initiative to
to driving sustainability performance and identifying
or said programs' equivalents if Hilton discontinues
with the Hilton Garden Inn franchisor to implement
es to minimize energy usage, carbon output, waste
tructed and managed for compliance with ISO 5001
14,001 and 9001 standards for environmental
,as certifications of the same.
o by the Riverfront Crossings Form -Based Code
Committee prior to issuance of a uilding permit.
The Owner shall donate t the City any prop rt
public purpose of reconstructi of Clinton Street t
public improvement project. is may include the do
construction easements and all occur at the time th
parties acknowledge that th extent of this dedication ,
the City would have the p er to condemn through its
Code Chapter 6A.
23
y rights minimally necessary to carry out the
such time as the City may undertake such a
ation of additional right-of-way or temporary
City completes the design of its project. The
�all be limited to those property rights which
dixercise of eminent domain pursuant to Iowa
EXHIBIT C
CERTIFICATE OF COMPLETION
WHEREAS, the City of Iowa C' , Iowa (the "City") and Iowa Ci Hotel Associates, L.L.C.
having an office for the transaction of usiness at (the " eveloper"), did on or about
the day of 15,1 m e, execute and deliver, each to he other, an Agreement for
Private Redevelopment (the X'Agree, ent"), wherein and where y the Developer agreed, in
accordance with the terms of the greement, to develop and main in certain real property located
within the City and as more partic arly described as follows:
The South 36 feet of Lot 6 and the North 44 feet of Lot 5 in Block 102 in the Original
Town of Iowa City, Iowa, accor i g to the plat recor d thereof.
WHEREAS, the Agreement incorpo ted and conta' ed certain covenants and restrictions with
respect to the development of the Develop nt Propert , and obligated the Developer to construct
certain Minimum Improvements (as defined erein) i accordance with the Agreement; and
WHEREAS, the Developer has to the pi
insofar as they relate to the construction of said
City to be in conformance with the approved bi
this certification.
NOW, THEREFORE, pursuant to
covenants and conditions of the Agreeme
successors and assigns, to construct the N
late performed said covenants and conditions
tum Improvements in a manner deemed by the
plans to permit the execution and recording of
3.2 the Agreement, this is to certify that all
aspect o the obligations of the Developer, and its
been completed and performed by the),eveloper and are ei
terminated insofar as they apply to the land described here'
County is hereby authorized to accep for recording and to re
conclusive determination of the saf,sfactory termination of t]
Agreement with respect to the coAstruction of the Minimum
Property. ;
All other provisions of
termination as provided them
(SEAL)
on the Development Property have
>y released absolutely and forever
The County Recorder of Johnson
the filing of this instrument, to be a
covenants and conditions of said
kprovements on the Development
Agreement shall otherwise remaii
CITY OF IOWA CITY,
By:
Mayor
24
in full force and effect until
ATTEST:
By:
City Clerk
STATE OF IOWA
COUNTY OF JOHNSON
On this day of
OF IOWA CITY
for said County, personally appeared Matthe
known, who being duly sworn, did say that th
City of Iowa City, Iowa, a Municipal Corporati
Iowa, and that the seal affixed to the foregoing
and that said instrument was signed and sealed
and resolution of its City Council and said Ma
the free act and deed of said Municipal Corp
20_, before me a Notary Public in and
and Marian K. Karr, to me personally
�fie Mayor and City Clerk, respectively of the
sated and existing under the laws of the State of
nent is the seal of said Municipal Corporation,
calf of said Municipal Corporation by authority
City Clerk acknowledged said instrument to be
by it voluntarily executed.
Notary�ublic in and for the State of Iowa
25
EXHIBIT D
ANNUAL CERTIFICATION
Date:
(due annually no later than November 1)
I, , the undersigned, having
City of Iowa City and Iowa City Hotel )
operations of the Development Property, hE
1. All ad valorem taxes on the Developm
as evidenced by the attached documentation;
2. (A) I have re-examined the terms and p.
affirm that during the preceding twelve (12) moi
the fulfillment of any of the terms and conditions
occupancy requirements of Section 3.3 thereto)
the lapse of time or the giving of notice, or both,
has occurred as of the date of this certificate.
OR
(B) the undersigned has re-examined the to
and that at the date of this certificate, the undersil
Agreement for the following reasons:
that the default has existed since
take the following action with respect
sledge of the Developers Agreement between the
iates, L.L.C., dated , 2015, and the
certify the following/
Property have b9bn paid for the prior fiscal year,
,isions of th Development Agreement and can
3, the Dev oper is not, or was not, in default in
said Agr ent (including but not limited to the
I that nyEvent of Default (or event which, with
gild beAome an Event of Default) is occurring or
3 provisions of the Development Agreement
aware that the Developer is in default of the
3. The Development Property is bang managed ir
energy management, and ISO 14001 an0001 standards
management, and the Developer has q(nTent, valid certif
4. All hotel -motel taxes impo4d pursuant to Iowa
of the hotel at 328 S. Clinton Street, Iowa City, Iowa,
evidenced by the attached quarterly tax return and receil
therein.
By: _
Title:
OR
that the Developer is taking or proposes to
compliance with ISO 5001 standards for
)r environmental management and quality
ations of the same.
de Section 423A.7 collected by operation
ave been paid for the prior quarter, as
t of payment for the tax obligation stated
QUARTERLY CERTIFICATION
Date:
(due by January 31, April 30, July 31)
I, , the undersigned, having knowledge of the Developer's Agreement between the
City of Iowa City and Iowa City Hotel Associates, L.L.C., dated , 2015, and the
operations of the Development Property, hereby certify the following;
1. All hotel -motel taxes imposed purst to Iowa Code Section 3A.7 collected by operation
of the hotel at 328 S. Clinton Street, IowaCity, Iowa, have been aid for the prior quarter, as
evidenced by the attached quarterly tax retu . and receipt of pa nt for the tax obligation stated
therein; and
2. (A) I have re-examined the terms an 1
affirm that during the preceding twelve (12) in
the fulfillment of any of the terms and condition,
occupancy requirements of Section 3.3 thereto)
the lapse of time or the giving of notice, or both,
has occurred as of the date of this certificate.
OR
(B) the undersigned has re-examined the ti
and that at the date of this certificate, the undersi
Agreement for the following reasons:
that the default has existed since
take the following action with respect
3. The Development Property is
energy management, and ISO 14001
management, and the Developer hac�
By: _
Title:
of t Development Agreement and can
s, the Dev Loper is not, or was not, in default in
said A ement (including but not limited to the
I that 96 Event of Default (or event which, with
uld come an Event of Default) is occurring or
§s nd provisions of the Development Agreement
dNs aware that the Developer is in default of the
that the Developer is taking or proposes to
ging managed in compliance with ISO 5001 standards for
9001 standards f r envir:mental management and quality
rent, valid certifi tions the same.
27
EXHIBIT F
The property locally known as 314 S. Clinton Street, Iowa City, Iowa, is described as
consisting of all that certain parcel or parcels of land located in the City of Iowa City, County of
Johnson, State of Iowa, more particularly described as follows:
i'NS��'��r��rt r��ccRtnN
�. �aor��
CITY OF IOWA CITY
410 East Washington Strccl
Iowa city. Iowa 52240-1826
(319) 356-5000
(319) 356-5009 FAX
%v%vlv.1cgo Y.org
LATE HANDOUTS
Information submitted between distribution of packet on Thursday and close of business
on Friday.
Regular Agenda:
ITEM 10 HOTEL DEVELOPMENT— See additional correspondence
Info Packet of 3/19:
Memo from City Manager: Rezoning request for the College St./Gilbert St. property
KENNEDY, CRUISE, FREY & GELNER, L.L.P.
ATTORNEYS AT LAW
920 S. DUBUQUE STREET - P.O. BOX 2000
MICHAEL W. KENNEDY IOWA CITY, IOWA 52244 MARCUS M. MILLS
KIRSTEN H. FREY TELEPHONE (319) 351-8181 EMILY C. KA51K
KANDIE K. GELNER FAX (319) 351-0605
March 20, 2015
City Council
410 E. Washington Street
Iowa City, IA 52240
Re: Agreement for Private Redevelopment Matters
Dear Council Members:
I represent Iowa City Hotel Associates, LLC, an Iowa limited liability company, the
Developer under the proposed Agreement for Private Redevelopment with the City of Iowa
City for the development for the Hilton Garden Inn Hotel on the property located at 328 S.
Clinton Street in Iowa City, Iowa. The principal parties involved in Iowa City Hotel
Associates are Michael E. Hodge, John Hieronymus, Kevin Digmann, and Bruce Kinseth or an
investment entity controlled by him. It ismy understanding that because`ofMr. Kinseth's in-
volvernent, the IoWa: City City Council has been --contacted regarding Kinseth` Hospitality
Companies, .Inca's status as a defendant in a lawsuit brought by DWG Investrf ents, L.L.C. and
said lawsuit's potential impact, if any, on the proposed Agreement for Private Redevelopment.
At the outset, I think it is important to understand that this project is not being devel-
oped by Kinseth Hospitality Companies, Inc. Rather, one of the principals in Kinseth
Hospitality Companies is one of the minority partners is the owner of the proposed develop-
ment. Kinseth brings to the table a longstanding, successful history in the development and
operation of hotels and other hospitality properties. Other partners in the project include
Michael E. Hodge, John Hieronymus, and Kevin Digmann, all whom have significant exper-
tise and experience in the development of local commercial projects.
Furthermore, it is important to note that the principal defendant in the above -referenced
litigation is 25`h Avenue Hotel Associates. Although Kinseth Hospitality Companies is named
as a defendant, counsel for Kinseth believes that said inclusion of Kinseth Hospitality
Companies is inappropriate and that Kinseth Hospitality Companies is not a proper party to the
lawsuit. Even if it is not dismissed, Kinseth Hospitality Companies plans on vigorously de-
fending the lawsuit. Most importantly, even in the event of an adverse ruling in the pending
litigation; any potential judgment would not have an adverse financial impact on Kinseth
Hospitality Companies' financial capability or future solvency or Bruce Kinseth's ability to
coinply`with the Agreement for Private Redevelopment with the City of Iowa City or with his
obligations to his partners in Iowa City Hotel Associates, LLC. Iowa City Hotel Associates,"
- Page -2-
LLC affirmatively acknowledges and represents that it has the ability to perform under the
Agreement for Private Redevelopment for this project regardless of this lawsuit.
As I am sure you know, Kinseth Hospitality Companies has many hotel properties and
has an ownership interest in many investment entities that are not a part of or impacted by this
project. Kinseth Hospitality Companies has recently entered into development agreements in
Bettendorf, Iowa; Bellevue, Nebraska; and Mason City, Iowa. In addition, Kinseth manages
Kings Pointe Resort, a hotel and water park in Storm Lake, Iowa for the City of Storm Lake.
Any of these municipalities would provide a reference for Kinseth if desired.
Kinseth has been operating, owning, and developing hotels for over twenty-five years
and three generations. Kinseth Hospitality Companies is a local company and a leader in the
hospitality industry with a strong portfolio of operating hotels; over ten projects in develop-
ment; and six hotels currently under construction. Kinseth employs approximately three -thou-
sand people across the Midwest and is a preferred developer by several hotel brands including
Hilton, Marriott, and IHG. Kinseth has a strong company culture built on Midwest values and
its reputation and portfolio evidence a strong resume and its stability. There is no doubt that
having Kinseth Hospitality Companies as a partner benefits Iowa City Hotel Associates, LLC
and ultimately, the City of Iowa City.
My client strongly believes that the development of a Hilton Garden Inn to downtown
Iowa City is an exceptional opportunity for the community. This project will be a prominent
and powerful economic generator for the community for many years to come. If you have any
additional questions about the litigation or its impact on my client's ability to move forward
with the Agreement for Private Redevelopment, please do not hesitate to contact me.
KHF/hr
cc: Mike Hodge
Kevin Digmann
John Hieronymus
Bruce Kinseth
4098(58)/2015-03-17 Ltr to City Council
/r
Prepared by Wendy Ford, Econ. Dev. Coordinator, 410 E Washington St Iowa City IA 52240 356-5248
RESOLUTION NO. 15-87
RESOLUTION APPROVING AN AGREEMENT FOR PRIVATE
REDEVELOPMENT BY AND BETWEEN THE CITY OF IOWA CITY, IOWA,
AND IOWA CITY HOTEL ASSOCIATES, L.L.C.
WHEREAS, Iowa City Hotel Associates, L.L.C. ("Developer") submitted a private redevelopment
proposal for a Hilton Garden Inn Hotel Conference Center and Rooftop Venue to be developed
at 328 S. Clinton Street, Iowa City, which proposal consists a 12 story hotel with approximately
140 rooms, conference space and a rooftop patio (hereinafter the "Project"), and requested the
City's financial assistance for said Project; and
WHEREAS, this property is located within the City -University Project 11 Urban Renewal Area
Amendment#10, and subject to the City -University Project 1 Urban Renewal Plan approved by
City Council on October 23, 2012 (resolution 12-459) which plan has been modified and
amended from time to time ("Plan"); and
WHEREAS, the Economic Development Committee considered said application and voted to
recommend approval to the City Council at its meeting on January 12, 2015; and
WHEREAS, City Staff has reviewed the application and proposed Developer's Agreement and
recommends approval to the City Council; and
WHEREAS, in exchange for the grant funds, the property owner has agreed to complete
minimum improvements consisting of at least $33,200,000 in project costs, which is intended to
increase the actual assessed value to $15,120,000; and will operate the hotel in accordance
with certain environmental standards; and
WHEREAS, a member of the development team also owns the adjacent parcel upon which the
University of Iowa Museum of Art is proposed to be built, and that parcel may have taxable
value from which taxable increment may be available, a portion of which, if diverted to this
project, would reduce the time required to reach the total economic development grant; and
WHEREAS, it is the determination of this City Council that acceptance of the proposal of the
Developer and approval of the Agreement for Private Redevelopment is in the public interest of
the residents of the City and is consistent with the purposes and objectives of the Plan.
NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF IOWA
CITY IOWA THAT
1. That the attached Agreement for Private Redevelopment by and between the City of
Iowa City Iowa and Iowa City Hospitality Associates, L.L.C. is in the public interest of the
residents of Iowa City and is hereby approved.
2. That said Agreement is consistent with and authorized by the Urban Renewal Plan and
all applicable State and federal laws including but not limited to Iowa Code Chapters 15A
and 403; and
Page 2
3. That the Mayor is authorized and directed to execute the Agreement and the City Clerk
is authorized and directed to attest his signature and to affix the seal of the City Clerk.
4. That the Mayor and City Clerk be and they are hereby authorized and directed to take all
such actions and do all such things as they shall determine to be necessary or
appropriate to ensure the City's performance as provided therein.
5. That the City Manager is hereby authorized to administer the terms of the Agreement for
Private Redevelopment.
Passed and approved this 23rd day of March , 2015.
Approved by
ATTEST: % `, , —,,, L
CITY CLERK City Attorney's Office
Resolutions No.
Page 3
15-87
It was moved by Mims and seconded by Throgmorton the
Resolution be adopted, and upon roll call there were:
AYES: NAYS: ABSENT:
x B otchway
x Dickens
x Dobyns
x Hayek
x Mims
x Payne
x Tbrogmorton
AGREEMENT FOR PRIVATE REDEVELOPMENT
By and Among
THE CITY OF IOWA CITY, IOWA,
vagi
IOWA CITY HOTEL ASSOCIATES, L.L.C.
AGREEMENT FOR PRIVATE REDEVELOPMENT
By and Among
THE CITY OF IOWA CITY, IOWA,
&RED
IOWA CITY HOTEL ASSOCIATES, L.L.C.
THIS AGREEMENT FOR PRIVATE REDEVELOPMENT (hereinafter called
"Agreement"), is made on oras of the ?,;6: day of Mal -(k , 2015, by and among
the CITY OF IOWA CITY, IOWA, a municipality (hereinafter called "City"), established pursuant to
the Code of Iowa of the State of Iowa and acting under the authorization of Chapter 15A and Chapter
403 of the Code of Iowa, 2015, as amended (hereinafter called "Urban Renewal Act") and Iowa City
Hotel Associates, L.L.C. having an office for the transaction of business at 2 Quail Creek Circle,
North Liberty, Iowa, 52317 (the "Developer").
WITNESSETH:
WHEREAS, in furtherance of the objectives of the Urban Renewal Act, the City has
undertaken a program for the clearance and reconstruction or rehabilitation of certain areas in the
City and has undertaken an economic development area in the City; and
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 "Urban Renewal Plan" or "Plan"); and
WHEREAS, a copy of the foregoing Urban Renewal Plan, as amended, has been recorded
among the land records in the office of the Recorder of Johnson County, Iowa; and
WHEREAS, the Developer owns or has the right to occupy certain real property located in
the foregoing Urban Renewal Area at 328 S. Clinton Street, Iowa City, Iowa, as more particularly
described in Exhibit A annexed hereto and made a part hereof (hereinafter "the Property"); and
WHEREAS, the Developer desires to construct a 12 -story, 144 -room hotel, as further
described in Exhibit D "Minimum Improvements and Uses," (hereinafter, "the Project") on the
Property, and cause the same to be operated in accordance with this Agreement; and
WHEREAS, by Resolution No. 15- , dated , 2105, the Urban Renewal Plan for
the City -University Project I Urban Renewal Area was amended to include a developer's agreement
for this Project as an Urban Renewal Project in furtherance of the goals and objectives of the Urban
Renewal Plan and the City's Comprehensive Plan
WHEREAS, the City has determined the Project is consistent with and authorized by the
Urban Renewal Plan and all applicable State and federal laws, including but not limited to Iowa
Code Chapters 15A, 423A, and 403, as well as the goals of the Downtown and Riverfront Crossings
Master Plan; and
WHEREAS, the City believes that the development and continued operation of the Property
pursuant to this Agreement and the fulfillment generally of this Agreement, are in the vital and best
2
interests of the City and in accord with the Urban Renewal Plan and the public purposes and
provisions of the applicable State and local laws and requirements under which the foregoing project
has been undertaken and is being assisted.
NOW, THEREFORE, in consideration of the premises and the mutual obligations of the
parties hereto, each of them does hereby covenant and agree with the other as follows:
ARTICLE I. DEFINITIONS
Section I.I. Definitions. In addition to other definitions set forth in this Agreement, all
capitalized terms used and not otherwise defined herein shall have the following meanings unless a
different meaning clearly appears from the context:
Agreement means this Agreement and all exhibits and appendices hereto, as the same may be
from time to time modified, amended or supplemented.
Certificate of Completion means a certification in the form of the certificate attached hereto as
Exhibit C and hereby made a part of this Agreement, provided to the Developer pursuant to Section
3.2 of this Agreement.
City means the City of Iowa City, Iowa, or any successor to its functions.
Code means the Code of Iowa, 2015, as amended.
Construction Plans means the plans, specifications, drawings and related documents reflecting
the construction work to be performed by the Developer on the Development Property and the other
properties upon which the Public Improvements will be located; the Construction Plans shall be as
detailed as the plans, specifications, drawings and related documents which are submitted to the
building inspector of the City as required by applicable City codes.
Coun means the County of Johnson, Iowa.
Developer means Iowa City Hotel Associates, L.L.C.
Development Property means that portion of the City -University Project I Urban Renewal Area
of the City described in Exhibit A hereto.
Economic Development Grants mean the payments to be made by the City to the Developer
under Article VIII of this Agreement.
Event of Default means any of the events described in Section 10.1 of this Agreement.
First Mortgage means any Mortgage granted to secure any loan made pursuant to either a
mortgage commitment obtained by the Developer from a commercial lender or other financial
institution to fund any portion of the construction costs and initial operating capital requirements of
the Minimum Improvements, or all such Mortgages as appropriate.
328 CLINTON TIF Account means a separate account within the City -University Project I
Urban Renewal Tax Increment Revenue Fund of the City, in which there shall be deposited all Tax
Increments received by the City with respect to the Minimum Improvements on the Development
Property described in Exhibit A, as well as 50% of any tax revenues collected pursuant to Iowa Code
Section 423A.7 solely from operation of the hotel constructed pursuant to this Agreement.
Minimum Improvements shall mean the construction of a 12 -story, steel -framed,
approximately 144 -room Hilton Garden Inn hotel, together with all related site improvements and
amenities, as described in Exhibit B hereto. Minimum Improvements shall not include increases in
assessed or actual value due to market factors.
Mortgage means any mortgage or security agreement in which the Developer has granted a
mortgage or other security interest in the Development Property, or any portion or parcel thereof, or
any improvements constructed thereon.
Net Proceeds means any proceeds paid by an insurer to the Developer under a policy or
policies of insurance required to be provided and maintained by the Developer, as the case may be,
pursuant to Article V of this Agreement and remaining after deducting all expenses (including fees
and disbursements of counsel) incurred in the collection of such proceeds.
Ordinance means Ordinance No. 01-3991 of the City, under which the taxes levied on the
taxable property in the City -University Project I Urban Renewal Area shall be divided and a portion
paid into the City -University Project I Urban Renewal Tax Increment Revenue Fund.
Project shall mean the construction and operation of the Minimum Improvements on the
Development Property, as described in this Agreement.
State means the State of Iowa.
City -University Project I Urban Renewal Tax Increment Fund means the special fund of the
City created under the authority of Section 403.19(2) of the Code and the Ordinance, which fund was
created in order to pay the principal of and interest on loans, monies advanced to or indebtedness,
whether funded, refunded, assumed or otherwise, including bonds or other obligations issued under
the authority of Section 403.9 or 403.12 of the Code, incurred by the City to finance or refinance in
whole or in part projects undertaken pursuant to the City -University Project I Urban Renewal Plan,
as amended.
4
Tax Increments means the property tax revenues with respect to the Minimum Improvements
that are divided and made available to the City for deposit in the City -University Project I Urban
Renewal Tax Increment Revenue Fund under the provisions of Section 403.19 of the Code and the
Ordinance.
Termination Date means the date of termination of this Agreement, as established in Section
12.8 of this Agreement.
Unavoidable Delays means delays resulting from acts or occurrences outside the reasonable
control of the party claiming the delay including but not limited to storms, floods, fires, explosions or
other casualty losses, unusual weather conditions, strikes, boycotts, lockouts or other labor disputes,
delays in transportation or delivery of material or equipment, litigation commenced by third parties,
or the acts of any federal, State or local governmental unit (other than the City).
Urban Renewal Plan means the City -University Project I Urban Renewal Plan, as amended,
approved in respect of the City -University Project I Urban Renewal Area, described in the preambles
hereof.
314 CLINTON TIF Account means a separate account within the City -University Project I
Urban Renewal Tax Increment Revenue Fund of the City, in which there shall be deposited $250,000
in tax increments received by the City with respect to the increase in assessed value from the January
1, 2016 assessed value once and for so long as the land and improvements on the property described
in Exhibit F ("the 314 S. Clinton Street property") reaches an assessed value of $18,600,000 and
$500,000 in tax increments are generated therefrom.
ARTICLE II. REPRESENTATIONS AND WARRANTIES
Section 2.1. Representations and Warranties of the City. The City makes the following
representations and warranties:
(a) The City is a municipal corporation and political subdivision organized under the
provisions of the Constitution and the laws of the State and has the power to enter into this
Agreement and carry out its obligations hereunder.
(b) The execution and delivery of this Agreement, the consummation of the transactions
contemplated hereby, and the fulfillment of or compliance with the terms and conditions of this
Agreement are not prevented by, limited by, in conflict with, or result in a breach of, the terms,
conditions or provisions of any contractual restriction, evidence of indebtedness, agreement or
instrument of whatever nature to which the City is now a party or by which it is bound, nor do they
constitute a default under any of the foregoing.
Section 2.2. Covenants, Obligations, Representations and Warranties of Developer. The
Developer makes the following representations and warranties:
(a) Developer is a Iowa corporation duly organized and validly existing under the laws of
the State of Iowa and has all requisite power and authority to own and operate its properties, to carry
on its business as now conducted and as presently proposed to be conducted, and to enter into and
perform its obligations under the Agreement.
(b) This Agreement has been duly and validly authorized, executed and delivered by the
Developer and, assuming due authorization, execution and delivery by the City, is in full force and
effect and is a valid and legally binding instrument of the Developer enforceable in accordance with
its terms, except as the same may be limited by bankruptcy, insolvency, reorganization or other laws
relating to or affecting creditors' rights generally.
(c) The execution and delivery of this Agreement, the consummation of the transactions
contemplated hereby, and the fulfillment of or compliance with the terms and conditions of this
Agreement are not prevented by, limited by, in conflict with, or result in a violation or breach of, the
terms, conditions or provisions of the certificate of incorporation and bylaws of Developer or its
parents or subsidiaries of any contractual restriction, evidence of indebtedness, agreement or
instrument of whatever nature to which the Developer is now a party or by which it or its property is
bound, nor do they constitute a default under any of the foregoing.
(d) There are no actions, suits or proceedings pending or threatened against or affecting the
Developer in any court or before any arbitrator or before or by any governmental body in which there
is a reasonable possibility of an adverse decision which could materially adversely affect the business
(present or prospective), financial position or results of operations of the Developer or which in any
manner raises any questions affecting the validity of the Agreement or the Developer's ability to
perform its obligations under this Agreement.
(e) Developer has not received any notice from any local, State for federal official that the
activities of Developer with respect to the Development Property may or will be in violation of any
environmental law or regulation (other than those notices, if any, of which the City has previously
been notified in writing). Developer is not currently aware of any State or federal claim filed or
planned to be filed by any party relating to any violation of any local, State or federal environmental
law, regulation or review procedure applicable to the Development Property, and Developer is not
currently aware of any violation of any local, State or federal environmental law, regulation or
review procedure which would give any person a valid claim under any State or federal
environmental statute with respect thereto.
(f) Developer will cooperate with the City in resolution of any traffic, parking, trash
removal, excessive noise or public safety problems which may arise in connection with the
construction and operation of the Minimum Improvements.
C�
(g) Developer would not undertake its obligations under this Agreement without the
payment by the City of the Economic Development Grants being made to the Developer pursuant to
this Agreement.
(h) The Developer will cause the Minimum Improvements to be constructed in accordance
with the terms of this Agreement and when constructed will comply with the Urban Renewal Plan
and all local, State and federal laws and regulations, except for variances that may be necessary to
construct the Minimum Improvements.
(i) The Developer will use its best efforts to obtain, or cause to be obtained, in a timely
manner, all required permits, licenses and approvals, and will meet, in a timely manner, all
requirements of all applicable local, State, and federal laws and regulations which must be obtained
or met in connection with the Project.
0) The Developer shall not, prior to the expiration of this agreement, cause or voluntarily
permit the Development Property and/or Minimum Improvements to become other than taxable
property by applying for or seeking any industrial property tax exemption, by being owned by a
utility or any other entity of a type where the assessed value of taxable property of such entity is not
treated as located within the Development Property, by being owned by any entity having tax exempt
status or by applying for or seeking for a deferral, abatement or exemption from property tax
pursuant to any present or future statute or ordinance.
ARTICLE III. DEVELOPMENT AND OCCUPANCY REQUIREMENT
Section 3.1. Minimum Improvements.
The Developer agrees to complete the Minimum Improvements generally consisting of
construction of a 12 -story Hilton Garden Inn hotel with 144 bedrooms, a meeting/event center, a roof
top food and beverage venue, a restaurant, and a pool/spa/fitness area, all as described more fully on
Exhibit B ("Minimum Improvements") attached hereto and incorporated herein by this reference.
The Redeveloper hereby commits to a Project that includes a minimum total of $33,205,936 in
project costs. By January 1, 2018, the construction of the Minimum Improvements must increase the
actual assessed value of the Development Property to at least $15,120,000.
Section 3.2. Certificate of Completion.
Upon written request of the Developer after issuance of an occupancy permit for the Minimum
Improvements, the City will furnish the Developer with a Certificate of Completion in substantially
the form set forth in Exhibit C attached hereto. Such Certificate of Completion shall be a conclusive
determination of satisfactory termination of the covenants and conditions of this Agreement solely
with respect to the obligations of the Developer to construct such portion of the Minimum
Improvements.
7
A Certificate of Completion may be recorded in the proper office for the recordation of deeds
and other instruments pertaining to the Development Property at the Developer's sole expense. If the
City shall refuse or fail to provide a Certificate of Completion in accordance with the provisions of
this Section 3.2, the City shall within twenty (20) days after written request by the Developer,
provide the Developer with a written statement indicating with adequate detail, in what respects the
Developer has failed to complete the Minimum Improvements in accordance with the provisions of
this Agreement, or is otherwise in default under the terms of this Agreement, and what measures or
acts will be necessary in the opinion of the City, to obtain such Certificate of Completion.
ARTICLE IV. RESERVED
ARTICLE V. INSURANCE
Section 5.1. Insurance Requirements.
(a) Upon completion of construction of the Minimum Improvements and at all times prior
to the Termination Date, the Developer shall maintain, or cause to be maintained, at its cost and
expense (and from time to time at the request of the City shall furnish proof of the payment of
premiums on) insurance as follows:
(i) Insurance against loss and/or damage to the Minimum Improvements under a
policy or policies covering such risks as are ordinarily insured through property policies against risk
by similar businesses, including (without limitation the generality of the foregoing) fire, extended
coverage, vandalism and malicious mischief, explosion, water damage, demolition cost, debris
removal, and collapse in an amount not less than the full insurable replacement value of the
Minimum Improvements, but any such policy may have a deductible amount of not more than
$250,000. No policy of insurance shall be so written that the proceeds thereof will produce less than
the minimum coverage required by the preceding sentence, by reason of co-insurance provisions or
otherwise, without the prior consent thereto in writing by the City. The term "full insurable
replacement value" shall mean the actual replacement cost of the Minimum Improvements
(excluding foundation and excavation costs and costs of underground flues, pipes, drains and other
uninsurable items) and equipment, and shall be determined from time to time at the request of the
City, but not more frequently than once every three years, by an insurance consultant or insurer
selected and paid for by the Developer and approved by the City.
(ii) Comprehensive general public liability insurance, including personal injury
liability for injuries to persons and/or property, including any injuries resulting from the operation of
automobiles or other motorized vehicles on or about the Development Property, in the minimum
amount for each occurrence and for each year of $1,000,000.
(iii) Such other insurance, including worker's compensation insurance respecting all
employees of the Developer, in such amount as is customarily carried by like organizations engaged
8
in like activities of comparable size and liability exposure; provided that the Developer may be self-
insured with respect to all or any part of its liability for worker's compensation.
(b) All insurance required by this Article V to be provided prior to the Termination Date
shall be taken out and maintained in responsible insurance companies selected by the Developer
which are authorized under the laws of the State of Iowa to assume the risks covered thereby. The
Developer will deposit annually with the City copies of policies evidencing all such insurance, or a
certificate or certificates or binders of the respective insurers stating that such insurance is in force
and effect. Unless otherwise provided in this Article V, each policy shall contain a provision that the
insurer shall not cancel or modify it without giving written notice to the Developer and the City at
least thirty (30) days before the cancellation or modification becomes effective. Not less than fifteen
(15) days prior to the expiration of any policy, the Developer shall furnish the City evidence
satisfactory to the City that the policy has been renewed or replaced by another policy conforming to
the provisions of this Article V, or that there is no necessity therefor under the terms hereof. In lieu
of separate policies, the Developer may maintain a single policy, or blanket or umbrella policies, or a
combination thereof, which provide the total coverage required herein, in which event the Developer
shall deposit with the City a certificate or certificates of the respective insurers as to the amount of
coverage in force upon the Minimum Improvements.
(c) The Developer agrees to notify the City as soon as reasonably possible in the case of
damage exceeding $250,000 in amount to, or destruction of, the Minimum Improvements or any
portion thereof resulting from fire or other casualty. Net Proceeds of any such insurance shall be
paid directly to the Developer, and the Developer will forthwith repair, reconstruct and restore the
Minimum Improvements to substantially the same or an improved condition or value as they existed
prior to the event causing such damage and, to the extent necessary to accomplish such repair,
reconstruction and restoration, the Developer will apply the Net Proceeds of any insurance relating to
such damage received by the Developer to the payment or reimbursement of the costs thereof.
(d) The Developer shall complete the repair, reconstruction and restoration of the
Minimum Improvements, whether the Net Proceeds of insurance received by the Developer for such
purposes are sufficient.
ARTICLE VI. COVENANTS OF THE DEVELOPER
Section 6.1. Maintenance of Properties. The Developer will maintain, preserve and keep
the Minimum Improvements in good repair and working order, ordinary wear and tear accepted, and
from time to time will make all necessary repairs, replacements, renewals and additions.
Section 6.2. Maintenance of Records. The Developer will keep at all times proper books of
record and account in which full, true and correct entries will be made of all dealings and
transactions of or in relation to the business and affairs of the Developer in accordance with
generally accepted accounting principles, consistently applied throughout the period involved, and
6
the Developer will provide reasonable protection against loss or damage to such books of record and
account.
Section 6.3. Compliance with Laws. The Developer will comply with all laws, rules and
regulations relating to the Minimum Improvements, other than laws, rules and regulations the failure
to comply with which or the sanctions and penalties resulting therefrom, would not have a material
adverse effect on the business, property, operations, or condition, financial or otherwise, of the
Developer.
Section 6.4. Non -Discrimination. In operating the Minimum Improvements, the Developer
shall not discriminate against any applicant, employee or tenant because of race, creed, color,
religion, sex, national origin, sexual orientation, age, disability, marital status or gender identity. The
Developer shall ensure that applicants, employees and tenants are considered and are treated without
regard to their race, creed, color, religion, sex, national origin, sexual orientation, age, disability,
marital status or gender identity.
Section 6.5. RESERVED.
Section 6.6. Annual Certification. To assist the City in monitoring and performance of the
Developer hereunder, a duly authorized officer of the Developer shall annually provide to the City:
(a) proof that all ad valorem taxes on the Development Property have been paid for the prior fiscal
year; and (b) certification that such officer has examined the terms and provisions of this Agreement
and that at the date of such certificate, and the Developer is not, and was not during the preceding
twelve (12) months, in default in the fulfillment of any of the terms and conditions of this Agreement
and that no Event of Default (or event which, with the lapse of time or the giving of notice, or both,
would become an Event of Default) is occurring or has occurred as of the date of such certificate or
during such period, or if the signer is aware of any such default, event or Event of Default, said
officer shall disclose in such statement the nature thereof, its period of existence and what action, if
any, has been taken or is proposed to be taken with respect thereto. Such statement, proof and
certificate shall be provided not later than November 1 of each year, commencing November 1,
2017, and ending on November 1, 2038, both dates inclusive. Upon certification by the Developer
on or before November 1, 2017, the City will certify to establish a base value for both the
Development Property and the 314 S. Clinton Street property as of January 1, 2016.
Section 6.7 Quarterly Certification. Prior to distribution to the Developer of any amounts
from the 328 CLINTON TIF Account deposited therein as a result of taxes collected pursuant to
Iowa Code Section 423A.7 and this Agreement, Developer shall quarterly provide to the City: (a)
proof that all hotel -motel taxes on the Development Property collected pursuant to Iowa Code
Section 423A.7 have been paid for the prior quarter; and (b) certification that such officer has
examined the terms and provisions of this Agreement and that at the date of such certificate, and the
Developer is not, and was not during the preceding twelve (12) months, in default in the fulfillment
of any of the terms and conditions of this Agreement and that no Event of Default (or event which,
with the lapse of time or the giving of notice, or both, would become an Event of Default) is
10
occurring or has occurred as of the date of such certificate or during such period, or if the signer is
aware of any such default, event or Event of Default, said officer shall disclose in such statement the
nature thereof, its period of existence and what action, if any, has been taken or is proposed to be
taken with respect thereto. Such statement, proof and certificate shall be provided not later than
January 31, April 30, July 31, and November 1 of each year, commencing January 31, 2017, and
ending on November 1, 203 8, both dates inclusive. This quarterly certification shall be in a form set
forth in Exhibit E hereto. The Parties acknowledge that the Annual Certification, the form of which
is set forth in Exhibit D hereto, may be filed in satisfaction of the November 1 Quarterly
Certification obligation.
Section 6.8 Taxation of Development Property. The Developer shall not, prior to the
expiration of this agreement, cause or voluntarily permit the Development Property and/or Minimum
Improvements to become other than taxable property by applying for or seeking any property tax
exemption, by being owned by a utility or any other entity of a type where the assessed value of
taxable property of such entity is not treated as located within the Development Property, by being
owned by any entity having tax exempt status or by applying for or seeking for a deferral, abatement
or exemption from property tax pursuant to any present or future statute or ordinance.
ARTICLE VII. ASSIGNMENT AND TRANSFER
Section 7.1. Status of the Developer; Transfer of Substantially All Assets. As security for the
obligations of the Developer under this Agreement, the Developer represents and agrees that, prior to
the issuance of the Certificate of Completion and prior to the Termination Date, the Developer will
maintain existence as an adequately -capitalized corporation and will not wind up or otherwise
dispose of all or substantially all of the Development Property and Minimum Improvements, or
assign its interest in this Agreement to any other party unless (i) the transferee partnership,
corporation, limited liability company or individual assumes in writing all of the obligations of the
Developer under this Agreement and (ii) the City consents thereto in writing in advance thereof, in
which case the Developer may be released of its obligations hereunder. Notwithstanding the
foregoing, however, or any other provisions of this Agreement, (a) Developer may transfer its
interest in and to this Agreement to any affiliate which is controlled by, under common control with
or controls Developer or to any entity that acquires all or substantially all of the assets of the
Developer or to any corporate successor to Developer by consolidation, merger, or otherwise, and (b)
the Developer may (1) pledge any and/or all of its assets or its right to payment under this agreement
as security for any financing of the Minimum Improvements; (2) assign its rights under this
Agreement to a third party, provided such assignment shall not release the Developer of its
obligations hereunder, and the City agrees in writing that Developer may assign its interest under this
Agreement for such purpose; and (3) the Developer may transfer its ownership interest to a third -
party under an arrangement whereby Developer will lease the Development Property back and
continue to satisfy the requirements of this Agreement.
ARTICLE VIII. ECONOMIC DEVELOPMENT GRANTS
11
Section 8. 1. Economic Development Grants.
(a) For and in consideration of the obligations being assumed by the Developer hereunder,
and in furtherance of the goals and objectives of the Urban Renewal Plan and the Urban Renewal
Act, the City agrees to make up to twenty-one (21) annual Economic Development Grants to the
Developer, subject to the Developer having received a Certificate of Completion and being and
remaining in compliance with the terms of this Agreement and subject to the terms of this Article
VIII. The total, aggregate amount of all Economic Development Grants under this Agreement shall
not exceed $8,800,000. The annual grants shall commence on June 1, 2020 and end on June 1, 2040,
or when the total of all grants is equal to $8,800,000, whichever is earlier.
to:
Unless the total grant amount of $8,800,000 is reached first, all annual grants shall be equal
(i) one hundred percent (1001/o) per fiscal year of the Tax Increments collected by the City
with respect to the Minimum Improvements on Development Property pursuant to Section
403.9 of the Urban Renewal Act under the terms of the Ordinance (without regard to any
averaging that may otherwise be utilized under Section 403.19 and excluding any interest
that may accrue thereon prior to payment to the Developer) during the preceding twelve-
month period in respect of the Development Properly and the Minimum Improvements, but
subject to adjustment and conditions precedent as provided in this Article (such payments
being referred to collectively as the "Economic Development Grants"); and
(ii) 50% per fiscal year of any and all revenues generated solely by the Project arising from
the taxes collected by the City pursuant to Iowa Code Section 423A.7 (2015), and
(iii) At such time as the property locally known as 314 S. Clinton Street, Iowa City, Iowa,
and legally described in Exhibit F attached hereto, has been developed, the assessed value of
said property reaches $18,600,000 and the property taxes are actually paid on this assessed
value, the City shall make an economic development grant to Developer a maximum of
$250,000 per fiscal year of the tax increments deposited into the 314 CLINTON TIF
Account.
The final Grant shall be adjusted, if necessary, if payment of the above-described amounts
would result in total, aggregate Economic Development Grants exceeding $8,800,000.
(b) The obligation of the City to make an Economic Development Grant to the Developer
in any year as specified above shall be subject to and conditioned upon the timely filing by the
Developer of all previous annual statements, proofs and certifications required under Section 6.6
hereof and the City Manager's approval thereof, which will not be unreasonably withheld. Beginning
with the November 1, 2018 certification, if the Developer's annual statement, proof and certification
is timely filed and contains the information required under Section 6.6 and the City Manager
approves of the same, the City shall certify to the Johnson County Assessor (the "County") prior to
12
December 1 of that year its request for the available Tax Increments resulting from the assessments
imposed by the County as of January 1 of that year, to be collected by the City as taxes are paid
during the following fiscal year and which shall thereafter be disbursed to the Developer on June 1 of
the following fiscal year. (For example, if the Developer and the City each so certify on November
and December 2018, respectively, the first Economic Development Grant would be paid to the
Developer on June 1, 2020). With respect to any grant made from the 314 CLINTON TIF Account,
once the 314 S. Clinton Street property has an assessed value of at least $18,600,000, the City shall,
in its certification to the Johnson County Assessor, request that the tax increment resulting from the
assessments imposed by the County as of January 1 of that year, to be collected by the City as taxes
are paid during the following fiscal year and which shall thereafter be disbursed to the Developer on
June 1 of the following fiscal year. The obligation of the City to make any grant from this funding
source is subject to and conditioned upon the generation of at least $500,000 in tax increment from
that property.
(c) In the event that the annual statement, proof or certificate required to be delivered by
the Developer under Section 6.7 is not delivered to the City by November 1 of any year, the
Developer recognizes and agrees that the City may have insufficient time to review and approve the
same and certify its request for Tax Increments to the County and that, as a result, no Economic
Development Grant may be made to the Developer in respect thereof. The City covenants to act in
good faith to appropriately review and consider any late certification on the part of the Developer,
but the City shall not be obligated to make any certification to the County for the available Tax
Increments or make any corresponding payment of the Economic Development Grant to the
Developer if, in the reasonable judgment of the City, it is not able to give appropriate consideration
(which may include, but not be limited to, specific discussion before the City Council at a regular
City Council meeting with respect thereto) to the Developer's certification due to its late filing. In
the event Developer fails to timely file an annual statement, proof or certificate due to an
Unavoidable Delay and, as a result, an Economic Development Grant cannot be made, Developer
may give written notice to the City and, if the City finds that Developer's failure is due to an
Unavoidable Delay, the missed Economic Development Grant shall be made in the year succeeding
the last scheduled Economic Development Grant under Section 8. 1, subject to Developer's filing
under Section 6.6 and all other provisions of this Article VIII with respect to such grant, it being the
intention of the parties to allow up to 21 annual Economic Development Grants in an aggregate
amount not to exceed $8,800,000, if Developer is in compliance with this Agreement.
(d) Such Economic Development Grants shall at all times be subject to termination in
accordance with the terms of this Article VIII and Article X. Thereafter, the taxes levied on the
Development Property and Minimum Improvements shall be divided and applied in accordance with
the Urban Renewal Act and the Ordinance. It is recognized by all parties that the total aggregate
amount set forth above is a maximum amount only and that the actual payment amounts will be
determined after the Minimum Improvements are completed and the valuations of said
Improvements have been determined by the City Assessor.
13
(e) In the event that any certificate filed by the Developer under Section 6.6 or other
information available to the City discloses the existence or prior occurrence of an Event of Default
that was not cured or cannot reasonably be cured under the provisions of Section 10.2 (or an event
that, with the passage of time or giving of notice, or both, would become an Event of Default that
cannot reasonably be cured under the provisions of Section 10.2), the City shall have no obligation
thereafter to make any further payments to the Developer in respect of the Economic Development
Grants and may proceed to take one or more of the actions described in Section 10.2 hereof.
Section 8.2. Source of Grant Funds Limited. (a) The Economic Development Grants shall be
payable from and secured solely and only by amounts deposited and held in the 328 CLINTON TIF
Account and the 314 CLINTON TIF Account of the City. The City hereby covenants and agrees to
maintain the Ordinance in force during the term hereof and to apply the incremental taxes collected
in respect of the Minimum Improvements and allocated to the 328 CLINTON TIF Account and the
314 CLINTON TIF Account to pay the Economic Development Grants, as and to the extent set forth
in Section 8.1 hereof. The Economic Development Grants shall be payable only from those sources
described in Section 8.1 hereof, and not in any manner by other tax increment revenues, by general
taxation, or from any other City funds.
(b) Notwithstanding the provisions of Section 8.1 hereof, the City shall have no obligation
to make an Economic Development Grant to the Developer if at any time during the term hereof the
City receives an opinion of its legal counsel or a controlling decision of an Iowa court having
jurisdiction over the subject matter hereof to the effect that the use of Tax Increments resulting from
the Minimum Improvements to fund an Economic Development Grant to the Developer, as
contemplated under said Section 8.1, is not authorized or otherwise an appropriate project activity
permitted to be undertaken by the City under the Urban Renewal Act or other applicable provisions
of the Code, as then constituted. Upon receipt of such an opinion or decision, the City shall
promptly forward a copy of the same to the Developer. If the circumstances or legal constraints
giving rise to the opinion or decision continue for a period during which two (2) Economic
Development Grants would otherwise have been paid to the Developer under the terms of Section
8. 1, the City may terminate this Agreement, without penalty or other liability to the Developer, by
written notice to the Developer.
(c) The City makes no representation with respect to the amounts that may finally be paid to
the Developer as the Economic Development Grants, and under no circumstances shall the City in
any manner be liable to the Developer so long as the City timely applies the Tax Increments actually
collected and held in the 328 CLINTON TIF Account (regardless of the amounts thereof) to the
payment of the Economic Development Grants to the Developer, as and to the extent described in
this Article.
Section 8.3. Use of Other Tax Increments. Subject to this Article VIII, the City shall be free to
use any and all Tax Increments collected in respect of increases in valuation on the Development
Property unrelated to construction of the Minimum Improvements (i.e. increases in assessed or actual
value due to market factors), any other properties within the Project Area, or any available Tax
14
Increments resulting from the suspension or termination of the Economic Development Grants under
Section 8.1 hereof, for any purpose for which the Tax Increments may lawfully be used pursuant to
the provisions of the Urban Renewal Act, and the City shall have no obligations to the Developer
with respect to the use thereof.
ARTICLE IX. INDEMNIFICATION
Section 9.1. Release and Indemnification Covenants.
(a) The Developer releases the City and the governing body members, officers, agents,
servants and employees thereof (hereinafter, for purposes of this Article IX, the "indemnified
parties") from, covenants and agrees that the indemnified parties shall not be liable for, and agrees to
indemnify, defend and hold harmless the indemnified parties against, any loss or damage to property
or any injury to or death of any person occurring at or about or resulting from any defect in the
Minimum Improvements.
(b) Except for any willful misrepresentation or any willful or wanton misconduct or any
unlawful act of the indemnified parties, the Developer, or its successors or assigns, agrees to protect
and defend the indemnified parties, now or forever, and further agrees to hold the indemnified parties
harmless, from any claim, demand, suit, action or other proceedings whatsoever by any person or
entity whatsoever arising or purportedly arising from (i) any violation of any agreement or condition
of this Agreement (except with respect to any suit, action, demand or other proceeding brought by
the Developer against the City to enforce his rights under this Agreement), (ii) the acquisition and
condition of the Development Property and the construction, installation, ownership, and operation
of the Minimum Improvements or (iii) any hazardous substance or environmental contamination
located in or on the Development Property relating to conditions caused by Developer after the
effective date of this Agreement.
(c) The indemnified parties shall not be liable for any damage or injury to the persons or
property of the Developer or its officers, agents, servants or employees or any other person who may
be on or about the Minimum Improvements due to any act of negligence of any person, other than
any act of negligence on the part of any such indemnified party or its officers, agents, servants or
employees.
(d) All covenants, stipulations, promises, agreements and obligations of the City contained
herein shall be deemed to be the covenants, stipulations, promises, agreements and obligations of the
City, and not of any governing body member, officer, agent, servant or employee of the City in the
individual capacity thereof.
(e) The provisions of this Article IX shall survive the termination of this Agreement.
ARTICLE X. DEFAULT AND REMEDIES
15
Section 10. 1. Events of Default Defined. The following shall be 'Events of Default" under
this Agreement and the term "Event of Default" shall mean, whenever it is used in this Agreement,
any one or more of the following events:
(a) Failure by the Developer to cause the construction of the Minimum Improvements to be
commenced and completed pursuant to the terms, conditions and limitations of Article III of this
Agreement;
(b) Transfer of any interest in this Agreement or the assets of the Developer in violation of
the provisions of Article VII of this Agreement;
(c) Failure by the Developer to substantially observe or perform any covenant, condition,
obligation or agreement on its part to be observed or performed under this Agreement;
(d) If the holder of any Mortgage on the Development Property, or any improvements
thereon, or any portion thereof, commences foreclosure proceedings as a result of any default under
the applicable Mortgage documents;
(e) If the Developer shall:
(A) file any petition in bankruptcy or for any reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief under the United States
Bankruptcy Act of 1978, as amended, or under any similar federal or state law; or
(B) make an assignment for the benefit of its creditors; or
(C) admit in writing its inability to pay its debts generally as they become due; or
(D) be adjudicated a bankrupt or insolvent; or if a petition or answer proposing the
adjudication of the Developer as a bankrupt or its reorganization under any present or future federal
bankruptcy act or any similar federal or state law shall be filed in any court and such petition or
answer shall not be discharged or denied within ninety (90) days after the filing thereof; or a receiver,
trustee or liquidator of the Developer or the Minimum Improvements, or part thereof, shall be
appointed in any proceedings brought against the Developer, and shall not be discharged within
ninety (90) days after such appointment, or if the Developer shall consent to or acquiesce in such
appointment; or
(f) If any representation or warranty made by the Developer in this Agreement, or made by
the Developer in any written statement or certificate furnished by the Developer pursuant to this
Agreement, shall prove to have been incorrect, incomplete or misleading in any material respect on
or as of the date of the issuance or making thereof.
16
(g) Notwithstanding anything to the contrary, however, in the event of an Event of Default
pursuant to subparagraphs (d) or (e) above, a Mortgagee who has received an assignment of the
Developer's rights pursuant to this Agreement as security as contemplated by Section 7.1(b) above,
shall have the right, at its option and subject to written agreement with the City, to expressly assume
the Developer's obligations to the City pursuant to this Agreement. In said event, said Mortgagee
shall be substituted as the Developer for the remainder of the term of this Agreement, the default
shall be deemed cured, and the parties shall continue to be bound hereby.
Section 10.2. Remedies on Default. Whenever any Event of Default referred to in Section
10.1 of this Agreement occurs and is continuing, the City, as specified below, may take any one or
more of the following actions after (except in the case of an Event of Default under subsections (d)
or (e) of said Section 10.1 in which case action may be taken immediately) the giving of thirty (3 0)
days' written notice by the City to the Developer and the holder of the First Mortgage (but only to the
extent the City has been informed in writing of the existence of a First Mortgage and been provided
with the address of the holder thereof) of the Event of Default, but only if the Event of Default has
not been cured within said thirty (30) days, or if the Event of Default cannot reasonably be cured
within thirty (30) days and the Developer does not provide assurances reasonably satisfactory to the
City that the Event of Default will be cured as soon as reasonably possible:
(a) The City may suspend its performance under this Agreement until it receives
assurances from the Developer, deemed adequate by the City, that the Developer will cure its default
and continue its performance under this Agreement;
(b) The City may terminate this Agreement;
(c) The City may withhold the Certificate of Completion;
(d) The City may take any action, including legal, equitable or administrative action, which
may appear necessary or desirable to enforce performance and observance of any obligation,
agreement, or covenant of the Developer, as the case may be, under this Agreement; or
(e) The City shall be entitled to recover from the Developer, and the Developer shall re -pay
to the City, an amount equal to the most recent Economic Development Grant previously made to the
Developer under Article VIII hereof, and the City may take any action, including any legal action it
deems necessary, to recover such amount from the Developer.
Section 10.3. No Remedy Exclusive. No remedy herein conferred upon or reserved to the City
is intended to be exclusive of any other available remedy or remedies, but each and every remedy
shall be cumulative and shall be in addition to every other remedy given under this Agreement or
now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right
or power accruing upon any default shall impair any such right or power or shall be construed to be a
waiver thereof, but any such right and power may be exercised from time to time and as often as may
be deemed expedient.
17
Section 10.4. No Implied Waiver. In the event any agreement contained in this Agreement
should be breached by any party and thereafter waived by any other party, such waiver shall be
limited to the particular breach so waived and shall not be deemed to waive any other concurrent,
previous or subsequent breach hereunder.
Section 10.5. Asreement to Pay Attorneys' Fees and Expenses. Whenever any Event of
Default occurs and the party who is not in default shall employ attorneys or incur other expenses for
the collection of payments due or to become due or for the enforcement or performance or
observance of any obligation or agreement on the part of the party in default herein contained, the
party in default agrees that it shall, on demand therefor, pay to the party not in default the reasonable
fees of such attorneys and such other expenses as may be reasonably and appropriately incurred by
the party not in default in connection therewith.
ARTICLE XI. OPTION TO TERMINATE AGREEMENT
Section 11.1. Option to Terminate. This Agreement may be terminated by the Developer if (i)
the Developer is in compliance with all material terms of this Agreement and no Event of Default
has occurred which has not been cured in accordance with the provisions of Section 10.2 hereof, and
(ii) the City fails to comply with any material term of this Agreement, and, after written notice by the
Developer of such failure, the City has failed to cure such noncompliance within thirty (30) days of
receipt of such notice, or, if such noncompliance cannot reasonably be cured by the City within thirty
(30) days of receipt of such notice, the City has not provided assurances reasonably satisfactory to
the Developer that such noncompliance will be cured as soon as reasonably possible.
Section 11.2. Effect of Termination. If this Agreement is terminated pursuant to this Article
XI, this Agreement shall be from such date forward null and void and of no further effect; provided,
however, that the City's rights to indemnification under Article IX hereof shall in all events survive
and provided further that the termination of this Agreement shall not affect the rights of any party to
institute any action, claim or demand for damages suffered as a result of breach or default of the
terms of this Agreement by another party, or to recover amounts which had accrued and become due
and payable as of the date of such termination. In any such action, the prevailing party shall be
entitled to recover its reasonable attorneys fees and related expenses incurred in connection therewith
(but only, in the case of the City, to the extent permitted by applicable law). Upon termination of
this Agreement pursuant to this Article XI, the Developer shall be free to proceed with the
construction and operation of the Minimum Improvements at its own expense and without regard to
the provisions of this Agreement.
18
ARTICLE XII. MISCELLANEOUS
Section 12.1. Conflict of Interest. The Developer represents and warrants that, to its best
knowledge and belief after due inquiry, no officer or employee of the City, or its designees or agents,
nor any consultant or member of the governing body of the City, and no other public official of the
City who exercises or has exercised any functions or responsibilities with respect to the Project
during his or her tenure, or who is in a position to participate in a decision-making process or gain
insider information with regard to the Project, has had or shall have any interest, direct or indirect, in
any contract or subcontract, or the proceeds thereof, for work or services to be performed in
connection with the Project, or in any activity, or benefit therefrom, which is part of the Project at
any time during or after such person's tenure.
Section 12.2. Notices and Demands. A notice, demand or other communication under this
Agreement by any party to the other shall be sufficiently given or delivered if it is dispatched by
registered or certified mail, postage prepaid, return receipt requested, or delivered personally, and
(a) In the case of the Developer, to 2 Quail Creek Circle, North Liberty, Iowa,
52317, Attn: Ben Kinseth;
(b) In the case of the City, to City Hall, 410 E. Washington Street, Iowa City, Iowa,
52240, Attn: City Manager;
or to such other designated individual or to such other address as any party shall have furnished to
the other in writing in accordance herewith.
Section 12.3. Titles of Articles and Sections. Any titles of the several parts, Articles, and
Sections of this Agreement are inserted for convenience of reference only and shall be disregarded in
construing or interpreting any of its provisions.
Section 12.4. Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall constitute one and the same instrument.
Section 12.5. Governing Law. This Agreement shall be governed and construed in accordance
with the laws of the State of Iowa.
Section 12.6. Entire Agreement. This Agreement and the exhibits hereto reflect the entire
agreement between the parties regarding the subject matter hereof, and supersedes and replaces all
prior agreements, negotiations or discussions, whether oral or written. This Agreement may not be
amended except by a subsequent writing signed by all parties hereto.
Section 12.7. Successors and Assigns. This Agreement is intended to and shall inure to the
benefit of and be binding upon the parties hereto and their respective successors and assigns.
19
Section 12.8. Termination Date. This Agreement shall terminate and be of no further force or
effect on and after June 1, 2040, or upon final payment of the Economic Development Grants,
whichever is sooner.
IN WITNESS WHEREOF, the Cityhas caused this Agreement to be duly executed in its name
and behalf by its Mayor and its seal to be hereunto duly affixed and attested by its City Clerk, the
Developer has caused this Agreement to be duly executed in its name and on its behalf by
(SEAL)
CITY OF IOWA CITY, IOWA
By:
Mayor
ATTEST: Approved by:
By: I �' �s-yam`' 7� ,�--1A a bU141 W-� 4y1h
City C erk City Attorney
3 2t��15
IOWA CITY HOTEL ASSOCIATES, L.L.C.
By:
CITY OF IOWA CITY
STATE OF IOWA
COUNTY OF JOHNSON
On this day of fY'V6?- r -C= .%- , 2015, before me a Notary Public in and
for said County, personally appeared Matthew J. Hayek and Marian K. Karr, to me personally
known, who being duly sworn, did say that they are the Mayor and City Clerk, respectively of the
City of Iowa City, Iowa, a Municipal Corporation, created and existing under the laws of the State of
Iowa, and that the seal affixed to the foregoing instrument is the seal of said Municipal Corporation,
and that said instrument was signed and sealed on behalf of said Municipal Corporation by authority
and resolution of its City Council and said Mayor and City Clerk acknowledged said instrument to be
the free act and deed of said Municipal Corporation by it voluntarily executed.
h� s !:ELLIE K. T— UTILE
f ". Cornmisrw?n Number221819
4 ;+•9y Co ss'on Expires Notary Public in and for the State of Iowa
L i6W + --
20
IOWA CITY HOTEL ASSOCIATES, L.L.C.
LON
Bv:
E.11od4e! Manager
Joho Hieronymus, Manager
Bruce Kinseth, Manager
ANN SEEGMILLER
STATE OF IOWA ) o ° Commission Number 780537
)SS Z My Commission Expires
COUNTY OF JOHNSON ) ftw September 27, 2016
This instrument was acknowledged before me on this 17" day of March, 2015, by Michael E. Hodge,
as manager of Iowa City Hotel Associates, L.L.C..
Notary Public in alld for the State of Iowa
STATE OF IOWA
)SS
COUNTY OF JOHNSON )
This instrument was acknowledged before me on this VVday of March, 2015, by John Hieronymus,
as manager of Iowa City Hotel Associates, L.L.C..
Notary PuWc in and for the Stdte of Iowa
o "'"<f HOLLY RICHARD
STA OWA ) > Commission Number 783170
My Commission Expires
)SS •www . March 17, 2017.
COUNTY OF JOHNS )
This instrument was acknowledged before 19 n this day of March, 2015, by Bruce Kinseth, as
manager of Iowa City Hotel Associates, L.L.C..
Notary Public in and for the State
IOWA CITY HOTEL ASSOCIATES, L.L.C.
By:
Michael E. Hodge, Manager
By:
John Hieronymus, Manager
By:. I_�-
Llv��
Bruce Kinseth, Manager
By:
Kevin Digmann, Manager
STATE OF IOWA
)SS
OUNTY OF JOHNSON )
This ins ent was acknowledged before me on this 17'' day of March, 2015, by Michael E. Hodge,
as manager o City Hotel Associates, L.L.C..
Notary Public in
STATE OF IOWA )
)SS
COUNTY OF JOHNSON )
This instrument was acknowledged before me on this _ day
as manager of Iowa City Hotel Associates, L.L.C..
STATE OF IOWA )
)SS
COUNTY OF JOHNSON )
for the State of Iowa
2015, by John Hieronymus,
Notary Public in and for the State of Iowa
0d
This instrument was acknowledged before me on this oB day of March, 2015, by Bruce Kinseth, as
manager of Iowa City Hotel Associates, L.L.C..
KATHI ELDER
T, ho
Notarial Seal - Iowa
Commission # 730271 I
My Commission Expires Q
I
Notary Public in and for the State of Iowa
IOWA CITY HOTEL ASSOCIATES, L.L.C.
By:
Michael E. Hodge, Manager
By:
John Hieronymus, Manager
By:
Brur 7nager
By:
Kei ann, kjknager
TE OF IOWA )
)SS
J Y OF JOHNSON )
This instrume was acknowledged before me on this 17"' day of March, 2015, by Michael E. Hodge,
as manager of Io a City Hotel Associates, L.L.C..
Notary Public in and for the State of Iowa
STATE OF IOWA
)S
COUNTY OF JOHNSON )
This instrument was acknowledged before on this day of March, 2015, by John Hieronymus,
as manager of Iowa City Hotel Associates, L.L. ..
Notary Publin and for the State of Iowa
STATE OF IOWA
)SS
COUNTY OF JOHNSON )
This instrument was acknowledged before me on this _ day of March, 201 , y Bruce Kinseth, as
manager of Iowa City Hotel Associates, L.L.C..
Notary Public in and for the State of Iowa
STATE OF IOWA
)SS
COUNTY OF JOHNSON )
41
This instrument was acknowledged before me on this day of March, 2015, by Kevin Digmann,
as manager of Iowa City Hotel Associates, L.L.C..
N tary Publi and for the State of owa
HOLLY RICHARD
_> Commission Number 783170
My Commission Expires
Maircl►17, 2017
EXHIBIT A
DEVELOPMENT PROPERTY
The. Development .Property is .described as consisting of all that certain parcel or parcels of
land located in the City of Iowa City, County of Johnson, State of Iowa, locally known as 328 S.
Clinton Street, and more particularly described as follows:
The South 36'feet of Lot 6 and the North 44 feet of Lot 5, in Block 102 in the Original Town of
Iowa City, Iowa, according to the plat recorded thereof.
22
EXHIBIT B
MINIMUM IMPROVEMENTS
The.Developer agrees to complete Minimum Improvements generally consisting of at least
$33,206,000 project costs in making improvements to the,property -located at 328 S. Clinton Street,
Iowa City, Iowa, which improvements shall include the construction of a 12 -story, steel -framed hotel
building. This building shall be comprised of two (2) stories for a hotel lobby, an approximate 2,500
square foot event and meeting room space, a restaurant, -:24-hour businesscenter, and a
pool/spa/fitness area; ten (10) stories of hotel rooms, for a total of approximately 144 rooms; and a
rooftop food and beverage venue.
The Developer shall enter into a franchise agreement with the Hilton Garden Inn franchise or,
if in the future a Hilton Garden Inn franchise is no longer available, a comparable hotel franchise
approved by the City, which approval shall not be unreasonably withheld. The Developer shall
participate in Hilton's LightStay sustainability measurement program and Hilton's initiative to
designate an employee or committee dedicated to driving sustainability performance and identifying
projects to improve performance at their hotels, or said programs' equivalents if Hilton discontinues
said programs. The Developer shall coordinate with the Hilton Garden Inn franchisor to implement
construction strategies and operational strategies to minimize energy usage, carbon output, waste
output and water usage. The project shall be constructed and managed for compliance with ISO 5001
standards for energy management, and ISO 14001 and 9001 standards for environmental
management and quality management, and obtain certifications of the same.
Any site plan for the Project must be approved by the Riverfront Crossings Form -Based Code
Committee prior to issuance of a building permit.
The Owner shall donate to the City any property rights minimally necessary to carry out the
public purpose of reconstruction of Clinton Street at such time as the City may undertake such a
public improvement project. This may include the donation of additional right-of-way or temporary
construction easements and shall occur at the time the City completes the design of its project. The
parties acknowledge that the extent of this dedication shall be limited to those property rights which
the City would have the power to condemn through its exercise of eminent domain pursuant to Iowa
Code Chapter 6A.
23
EXHIBIT C
CERTIFICATE OF COMPLETION
WHEREAS, the City of Iowa City, Iowa (the "City") and Iowa City Hotel Associates, L.L.C.
having an office for the transaction of business at (the "Developer"), did on or about
the day of , 2015, make, execute and deliver, each to the other, an Agreement for
Private Redevelopment (the "Agreement"), wherein and whereby the Developer agreed, in
accordance with the terms of the Agreement, to develop and maintain certain real property located
within the City and as more particularly described as follows:
The South 36 feet of Lot 6 and the North 44 feet of Lot 5, in Block 102 in the Original
Town of Iowa City, Iowa, according to the plat recorded thereof.
WHEREAS, the Agreement incorporated and contained certain covenants and restrictions with
respect to the development of the Development Property, and obligated the Developer to construct
certain Minimum Improvements (as defined therein) in accordance with the Agreement; and
WHEREAS, the Developer has to the present date performed said covenants and conditions
insofar as they relate to the construction of said Minimum Improvements in a manner deemed by the
City to be in conformance with the approved building plans to permit the execution and recording of
this certification.
NOW, THEREFORE, pursuant to Section 3.2 of the Agreement, this is to certify that all
covenants and conditions of the Agreement with respect to the obligations of the Developer, and its
successors and assigns, to construct the Minimum Improvements on the Development Property have
been completed and performed by the Developer and are hereby released absolutely and forever
terminated insofar as they apply to the land described herein. The County Recorder of Johnson
County is hereby authorized to accept for recording and to record the filing of this instrument, to be a
conclusive determination of the satisfactory termination of the covenants and conditions of said
Agreement with respect to the construction of the Minimum Improvements on the Development
Property.
All other provisions of the Agreement shall otherwise remain in full force and effect until
termination as provided therein.
(SEAL) CITY OF IOWA CITY, IOWA
Lb -a
24
Mayor
ATTEST:
By:
City Clerk
STATE OF IOWA
COUNTY OF JOHNSON
CITY OF IOWA CITY
On this day of , 20_, before me a Notary Public in and
for said County, personally appeared Matthew J. Hayek and Marian K. Karr, to me personally
known, who being duly sworn, did say that they are the Mayor and City Clerk, respectively of the
City of Iowa City, Iowa, a Municipal Corporation, created and existing under the laws of the State of
Iowa, and that the seal affixed to the foregoing instrument is the seal of said Municipal Corporation,
and that said instrument was signed and sealed on behalf of said Municipal Corporation by authority
and resolution of its City Council and said Mayor and City Clerk acknowledged said instrument to be
the free act and deed of said Municipal Corporation by it voluntarily executed.
Notary Public in and for the State of Iowa
O
EXHIBIT D
ANNUAL CERTIFICATION
Date:
(due annually no later than November 1)
. F I, ,;the undersigned, having knowledge of the Developer's Agreement between the
City 'of Iowa City and Iowa City Hotel Associates, L.L.C., dated , 2015, and the
operations of the Development Property, hereby certify the following;
1. All ad valorem. taxes on the Development Property have been paid for the prior fiscal year,
as evidenced by the attached documentation; and
2. (A) I have re-examined the terms and provisions of the Development Agreement and can
affirm. that during the preceding twelve (12) months, the Developer is not, or was not, in default in
the fulfillment of any of the terms and conditions of said Agreement (including but not limited to the
occupancy requirements of Section 3.3 thereto) and that no Event of Default (or event which, with
the lapse of time or the giving of notice, or both, would become an Event of Default) is occurring or
has occurred as of the date of this certificate.
OR
(B) the undersigned has re-examined the terms and provisions of the Development Agreement
and that at the date of this certificate, the undersigned is aware that the Developer is in default of the
Agreement for the following reasons:
that the default has existed since (date); and that the Developer is taking or proposes to
take the following action with respect thereto:
3. The Development Property is being managed in compliance with ISO 5001 standards for
energy management, and ISO 14001 and 9001 standards for environmental management and quality
management, and the Developer has current, valid certifications of the same.
4. All hotel -motel taxes imposed pursuant to Iowa Code Section 423A.7 collected by operation
of the hotel at 328 S. Clinton Street, Iowa City, Iowa, have been paid for the prior quarter, as
evidenced by the attached quarterly tax return and receipt of payment for the tax obligation stated
therein.
By: _
Title:
W,
EXHIBIT E
QUARTERLY CERTIFICATION
Date:
(due by January 31, April 30, July 31)
I, , the undersigned, having knowledge of the Developer's Agreement between the
City of Iowa City and Iowa City Hotel Associates, L.L.C., dated , 2015, and the
operations of the Development Property, hereby certify the. following;
1. All hotel -motel taxes imposed pursuant to Iowa Code, Section 423A.7 collected by operation
of the hotel at 328 S. Clinton Street, Iowa City, Iowa, have been paid for the prior quarter, as
evidenced by the attached quarterly tax return and receipt of payment.for the tax obligation stated
therein; and
2. (A) I have re-examined the terms and provisions of the Development Agreement and can
affirm that during the preceding twelve. (12) months, the Developer isnot, or was not, in default in
the fulfillment of any of the terms and conditions of said Agreement (including but not limited to the
occupancy requirements of Section 3.3 thereto) and that no Event of Default (or event which, with
thelapse of time or the giving of notice, or both, would become an•Event of Default) is: occurring or
has occurred as of the date of this certificate. ?
OR
(B) the undersigned has re-examined the terms and provisions: ofthe: Development Agreement
and that at the date of this certificate, the undersigned is aware.that the Developer is in default of the
Agreement for the following reasons:
that the default has existed since. (date); and that the Developer is taking or proposes to
take the following action with respect thereto:
3. The Development Property is being managed in compliance with ISO 500.1 standards for
energy management, and ISO 14001 and 9001 standards for environmental management and quality
management, and the Developer has current, valid certifications oof the same.
By:
Title:
27
EXHIBIT F
The property locally known as 314 S. Clinton Street, Iowa City, Iowa, is described as consisting of
all that certain parcel or parcels of land located in the City of Iowa City, County of Johnson, State of
Iowa, more particularly described as follows:
Lots 7 and 8 in Block 102, in Iowa City, Johnson County, Iowa, according to the recorded plat
thereof.
r 03-23-15_
N CITY OF IOWA CITY 11
CITYOFIOWA CITY MEMORANDUM
umsco aTy of uTtRATm
Date:
February 25, 2015
To:
Tom Markus, City Manager
From:
Wendy Ford, Economic Development Coordinator
Re:
Hotel/Motel Tax Resolution
Introduction:
The development agreement for the Hilton Garden Inn on Clinton Street contemplates public
financing by a combination of TIF and a portion of the new hotel/motel tax generated by the
property. The current Local Transient Guest Tax, also known as hotel/motel tax, is a 7% tax
levied on hotel, motel and other sleeping rooms for rent to transient guests. A 5% hotel/motel
tax was approved by voters in 1982, and ten years later another ballot approved an increase to
7%. The division of those revenues, to the extent allowable by Iowa law, are then approved by
City Council resolution.
History/Background:
The division of hotel/motel taxes has changed as follows since the 7% tax was approved in
1992.
Discussion of Solution:
This resolution would keep the division of taxes as they have been on all hotel properties in
Iowa City except for the new Hilton Garden Inn. Fifty percent (50%) of the hotel taxes generated
by the new hotel would be rebated back to the developer until a combination of TIF financing
and hotel/motel taxes reached the not -to -exceed development agreement amount of $8.8
million. The goal of this strategy is to reduce the TIF rebate period from 23 years to 12-15 years.
The developer's conventional financing institution has indicated the 23 year TIF rebate period is
not acceptable.
Effective upon the first quarter for which hotel taxes are collected from the Hilton Garden Inn
Hotel,,taxes collected from hotels in Iowa City shall be distributed as follows:
Taxes
Police Protection
Iowa City Area
Convention &
Visitors Bureau
Parkland
Acquisition and
development
Parks & Rec
Operations
1992
50%
25%
10%
15%
1998
50%
25%
0%
25%
2004
50%
22.5%
0%
27.5%
2005
47.5%
25%
0%
27.5%
Discussion of Solution:
This resolution would keep the division of taxes as they have been on all hotel properties in
Iowa City except for the new Hilton Garden Inn. Fifty percent (50%) of the hotel taxes generated
by the new hotel would be rebated back to the developer until a combination of TIF financing
and hotel/motel taxes reached the not -to -exceed development agreement amount of $8.8
million. The goal of this strategy is to reduce the TIF rebate period from 23 years to 12-15 years.
The developer's conventional financing institution has indicated the 23 year TIF rebate period is
not acceptable.
Effective upon the first quarter for which hotel taxes are collected from the Hilton Garden Inn
Hotel,,taxes collected from hotels in Iowa City shall be distributed as follows:
Taxes
Iowa City Area
Parkland
Hilton Garden
generated
Police
Convention &
Acquisition &
Parks & Rec
Inn
from:
Protection
Visitors Bureau
development
Operations
development
All Iowa City
hotels except
Hilton Garden Inn
47.5%
25%
0%
27.5%
0%
Hilton
Garden Inn
23.75%
12.5%
0%
13.75%
50%
March 17, 2015
Page 2
Financial Impact:
The developer estimates the new hotel motel taxes generated in year one by the Hilton Garden
Inn at $286,978. Using the formula above, $143,489 would be rebated to the developer,
$68,157 would go to Police protection, $35,872 would go to the CVB, and $39,459 would go to
Parks and Rec operations. All entities currently receiving a portion of hotel/motel taxes would
see an increase in their receipts due to the new hotel property. The use of hotel/motel taxes to
meet the public financing portion of the development agreement will shorten the timeframe
required to meet the $8.8 million public financing obligation.
This arrangement would continue until the combination of TIF and hotel/motel tax rebates
totaled $8.8 million, estimated to be 12 to 15 years.
Recommendation:
Staff and the City Council Economic Development Committee recommend approval of the
resolution approving the change in the division of hotel/motel tax revenues derived from the
proposed new hotel.
�j
Prepared by: Wendy Ford, 410 E. Washington St., Iowa City, IA 52240 (319) 356-5248
RESOLUTION NO. 15-88
RESOLUTION RESCINDING RESOLUTION 05-113 AND
ESTABLISHING A NEW POLICY FOR USE OF FUNDS DERIVED FROM
HOTEL -MOTEL TAX
WHEREAS, as authorized by Chapter 422A of the Code of Iowa, at an election on
November 3, 1992, the voters of Iowa City approved an increase from five percent (5%)
to seven percent (7%) for the tax upon gross receipts from rental of hotel and motel
rooms in the City (the "hotel -motel tax"); and
WHEREAS, Code Section 422A.2 places certain limitations on the use of fifty percent
(50%) of the funds derived from the hotel -motel tax; and
WHEREAS, the City Council adopted Resolutions 98-164, 04-180, and 05-113
establishing and revising a policy for use of funds derived from the hotel -motel tax based
on a seven percent tax rate; and
WHEREAS, the City Council has formally allocated the proceeds from the hotel -motel tax
revenues.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
IOWA CITY, IOWA, THAT:
Section 1. Resolution 05-113 is hereby rescinded.
Section 2. For the duration of the development agreement between the City and Iowa
City Hotel Associates, L.L.C., or their successor in interest, approved -
contemporaneously herewith, the hotel -motel tax revenues collected from the hotel to
be located at 328 S. Clinton Street, Iowa City, Iowa, shall be allocated as follows. Upon
the termination of the development agreement, the hotel -motel tax revenues collected
from said hotel shall be allocated according to Section 3 below.
a. Twenty-three and 3/4 percent (23.75%) shall be allocated to police protection.
b. Twelve and one-half percent (12.5%) shall be allocated to the Iowa City-
Coralville Area Convention and Visitors Bureau for the promotion and
encouragement of tourism and convention business in the City.
c. Thirteen and 3/4 percent (13.75%) shall be allocated for the constructing,
improving, enlarging, equipping or operation of parks and recreational
facilities.
d. Fifty percent (50%) shall be allocated to the developer for the development of
a hotel pursuant to an agreement between the developer and the City.
Section 3. The hotel -motel tax revenues collected from all sources within Iowa City,
except as described in Section 2 above, shall be allocated as follows:
a. Forty-seven and one-half percent (47.5%) shall be allocated to police
protection.
b. Twenty-five percent (25%) shall be allocated to the Iowa City-Coralville Area
Convention and Visitors Bureau for the promotion and encouragement of
tourism and convention business in the City.
c. Twenty-seven and one-half percent (27.5%) shall be allocated for the
constructing, improving, enlarging, equipping or operation of parks and
recreational facilities.
Passed and approved this 23rd day of March , 2015.
4145�
MAYOR
Approved by
ATTEST: «�.,�/ �� -% 10- L -Xxa
CITY -CLERK ' City Attorney's Office 3l�
3�s
Resolution No.
]Page 3
15-88
It was moved by Dickens and seconded by Botchway the
Resolution be adopted, and upon roll call there were:
AYES:
NAYS: ABSENT:
x
Botchway
x
Dickens
x
Dobyns
x
Hayek
x
Mims
x
Payne
x Throgmorton