HomeMy WebLinkAboutCardinal Construction - Dev Agmnt - 8/7/2017Prepared by: Noel Anderson,
Please return this copy to:
City Clerk & Finance Dept.
715 Mulberry St.
Waterloo, IA 50703
DEVELOPMENT AGREEMENT
715 Mulberry Street, Waterloo, Iowa 50703 319.291.4366
This Development Agreement is entered into as of
between Cardinal Construction, Inc. (an Iowa Corporation), (the Company"), and the
City of Waterloo, Iowa (the "City").
qI , 2017, by and
RECITALS
A. City considers economic development within the City a benefit to the
community and is willing for the overall good and welfare of the
community to provide financial incentives so as to encourage that goal.
B. Company is willing and able to finance and construct a building and
related improvements on property located in the Martin Road
Development Area.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants set forth herein,
the parties agree as follows:
1. Sale of Property. On or before August 30, 2017, City shall convey, or
cause to be conveyed, to Company the real property described in Exhibit "A" hereto
(the "Property") for the sum of $1.00 (the "Purchase Price"). Conveyance shall be by
special warranty deed, free and clear of all encumbrances arising by or through City
except: (a) easements, conditions and restrictions of record; (b) current and future real
estate real property taxes and assessments subject to the agreements made herein; (c)
general utility and right-of-way easements serving the Property; and (d) restrictions
imposed by the City zoning ordinances, or other applicable law. It is acknowledged that
neither the City nor the Company has conducted a Phase 1 or other environmental
study of the Property, which was formerly an acreage and cropland which are believed
to have caused minimal environmental impact. Therefore it is agreed that if, within
twelve (12) months of conveyance, it is determined that there was a violation of
environmental law or regulation at the time of conveyance which is not of the making of
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the Company, its successors, contractors or agents, then the City will bear the costs of
remediation or cleanup and indemnify and hold the Company harmless from such
costs, within a scope of remediation consistent with hazards reasonably possible in light
of the Property's former use as an acreage and cropland. If remediation is necessary
for conditions outside such scope, the parties agree to negotiate in good faith regarding
allocation of costs.
2. Improvements by Company.
A. New Construction. Company shall construct a building consisting
of approximately 5,000 square feet of office and 15,000 sq. ft. of industrial
building, and related landscaping, sidewalks, signage and parking improvements
(collectively, the "Improvements"). The Improvements shall be constructed in
accordance with all applicable City, state, and federal building codes, and shall
comply with all applicable City ordinances and other applicable law. It is
contemplated that the value added by the Improvements will, upon completion,
result in an assessed value of no less than $1,100,000.00. The Property, the
Improvements, and all site preparation and development -related work to make
the Property usable for Company's purposes as contemplated by this Agreement
are collectively referred to as the "Project".
B. Floodway Alterations. A portion of the Property lies within the
floodway. Company will remove fill from the floodway area and deposit it on
buildable areas of the Property, to raise the elevation of such area. Company
may also choose to construct, before the Project Completion Date defined
below, a detention pond of a size greater than is necessary to handle storm
water runoff from the Project site, to receive surface water flows from other
properties in the vicinity. If such a detention pond or system is capable of use by
developments other than the Project, then City will negotiate with Company in
good faith to compensate Company for its investment in excess capacity of the
detention pond.
C. Wetland Development. Company may choose to develop, before
the Project Completion Date defined below, a wetland area within the floodway
area on the Property, and in that event City will work with Company in good faith
to identify other current wetland areas along West Ridgeway Avenue that may be
suitable for transfer to Company for development purposes. Terms of any
transfer may be set forth in a separate development agreement.
3. Timeliness of Construction; Possibility of Reverter. The parties agree
that Company's commitment to undertake the Project and to construct the
Improvements in a timely manner constitutes a material inducement for the City to
extend the development incentives provided for in this Agreement, including but not
limited to its commitment to convey the Property to Company, and that without said
commitment City would not have done so. Company must obtain a building permit and
begin construction no later than twenty-two (22) months after the date of this
Agreement (the "Project Start Date"), and construction of Improvements on the Property
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shall be completed within twelve (12) months of that Project Start Date (the "Project
Completion Date"). If. by the Project Start Date, Company has not begun in good faith
to begin construction of the Improvements upon the Property, then title to the Property
shall revert to the City. If construction has not begun by the Project Start Date, but the
development of the Project is still imminent, the City Council may, but shall not be
required to, consent to an extension of time for the construction of the Improvements,
and if an extension is granted but construction of the Improvements has not begun
within such extended period, then the title to the Property shall revert to the City after
the end of said extended period. If development has commenced by the Project Start
Date or within any extended period and is stopped and/or delayed as a result of an act
of God, war, civil disturbance, court order, labor dispute, fire, or other cause beyond the
reasonable control of Company, the requirement that construction is to be completed by
the Project Completion Date shall be tolled for a period of time equal to the period of
such stoppage or delay, and thereafter if construction is not completed within the
allowed period of extension the title to the Property shall revert to the City after the end
of said period.
In the event of any reverter of title, Company agrees that it shall, at its
own expense, promptly execute all documents, including but not limited to a special
warranty deed, or take such other actions as the City may reasonably request to
effectuate said reverter of title. Company shall pay in full, so as to discharge or satisfy,
all liens, claims, charges, and encumbrances on or against the Property. Company
further agrees that it shall indemnify and hold harmless the City with respect to any
demand, claim, cause of action, damage, or injury made, suffered, or incurred as a
result of or in connection with the Project, or Company's failure to carry on or complete
same, or Company's ownership of the Property. If the City files suit to enforce the
terms of this Section 3 and prevails in such suit, then the Company shall be liable for all
of the City's legal expenses, including but not limited to reasonable attorneys' fees.
4. Water and Sewer. City will provide water main and sewer main
infrastructure to the Property line, and Company will be responsible for extending water
and sewer service to any location on the Property that it desires and for payment of any
associated connection fees.
5. Property Tax Rebates. Provided that Company has completed the
Improvements as set forth herein and has executed the Minimum Assessment
Agreement as set forth in Section 6, the City agrees to rebate property taxes (with the
exceptions noted below) as follows:
a. Year One - 50% rebate
b. Year Two - 50% rebate
c. Year Three - 50% rebate
d. Year Four - 50% rebate
e. Year Five - 50% rebate
for any taxable value over the January 1, 2017 value of $21,764 (calculated as 5.5
acres from parcel number 8913-32-426-003 which is valued at $2,098.75 per acre for a
total of $11,544; and for the entire parcel of 8913-32-426-002 valued at a total of
$10,220). Rebates are payable in respect of a given year only to the extent that
Company has actually paid general property taxes due and owing for such year. To
receive rebates for a given year, Company must, within twelve (12) months after the tax
payment due date, submit a completed rebate request to City on the form provided by
or otherwise satisfactory to City, otherwise Company will forfeit its right to a rebate for
that year.
The taxable value of the Property as a result of the Improvements must
be increased by a minimum of 10% and must increase the annual tax by a minimum of
$500. This rebate program is not applicable to any special assessment levy, debt
service levy, or any other levy that is exempted from treatment as tax increment
financing under the provisions of applicable law. The first year in which a rebate may
be given ("Year One") shall be the first full year for which the assessment is based upon
the completed value of the Improvements and not a prior year for which the
assessment is based solely upon the value of the land or upon the value of the land
and a partial value of the Improvements, due to partial completion of the Improvements
or a partial tax year.
6. Minimum Assessment Agreement. Company acknowledges and
agrees that it will pay when due all taxes and assessments, general or special, and all
other lawful charges whatsoever levied upon or assessed or placed against the
Property. Company further agrees that, prior to the date set forth in Section 2 of
Exhibit "B", it will not seek or cause a reduction in the taxable valuation for the Property,
which shall be fixed for assessment purposes, below the aggregate amount of
$1,100,000.00 ("Minimum Actual Value"), through:
(i) willful destruction of the Property, Improvements, or any part of
either;
(ii) a request to the assessor of Black Hawk County; or
(iii) any proceedings, whether administrative, legal, or equitable, with
any administrative body or court within the City, Black Hawk
County, the State of Iowa, or the federal government.
Company agrees to sign the agreement attached as Exhibit "B" at closing.
7. Representations and Warranties of City. City hereby represents and
warrants as follows:
A. City is not prohibited from consummating the transaction
contemplated in this Agreement by any law, regulation, agreement, instrument,
restriction, order or judgment.
B. Each person who executes and delivers this Agreement and all
documents to be delivered hereunder is and shall be authorized to do so on
behalf of City.
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8. Representations and Warranties of Company. Company hereby
represents and warrants as follows:
A. Company is not prohibited from consummating the transaction
contemplated in this Agreement by any law, regulation, agreement, instrument,
restriction, order or judgment.
B. Company is duly organized, validly existing, and in good standing
under the laws of the state of its organization and is duly qualified and in good
standing under the laws of the State of Iowa.
C. Company has full right, title, and authority to execute and perform
this Agreement and to consummate all of the transactions contemplated herein,
and each person who executes and delivers this Agreement and all documents
to be delivered to City hereunder is and shall be authorized to do so on behalf of
Company.
9. Abstracting. No less than ten (10) days prior to the anticipated date of
conveyance, City shall, at its own expense, deliver to Company an updated abstract of
title, or in lieu thereof Company may, at its own expense, obtain whatever form of title
evidence it desires. If title is unmarketable or subject to matters not acceptable to
Company, and if City does not remedy or remove such objectionable matters in timely
fashion following written notice of such objections from Company, Company may
terminate this Agreement.
10. Obligations Contingent. Each and every obligation of City under this
Agreement is expressly made subject to and contingent upon City's completion of all
procedures, hearings and approvals deemed necessary by City or its legal counsel for
amendment of the urban renewal plan applicable to the Property and/or project area, all
of which must be completed within 180 days from the date this Agreement is approved
by the City council. If such completion does not occur, then this Agreement shall be
deemed canceled and shall be null and void.
11. Notices. Any notice under this Agreement shall be in writing and shall be
delivered in person, by overnight air courier service, by United States registered or
certified mail, postage prepaid, or by facsimile (with an additional copy delivered by one
of the foregoing means), and addressed:
(a) if to City, at 715 Mulberry Street, Waterloo, Iowa 50703, facsimile
number 319-291-4571, Attention: Mayor, with copies to the City Attorney and
the Community Planning and Development Director.
(b) if to Company, to Cardinal Construction, Inc., 531 Commercial
Street, Suite 700, Waterloo, Iowa 50701, Attention: Gene Leonhart.
Delivery of notice shall be deemed to occur (i) on the date of delivery when delivered in
person, (ii) one (1) business day following deposit for overnight delivery to an overnight
air courier service which guarantees next day delivery, (iii) three (3) business days
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following the date of deposit if mailed by United States registered or certified mail,
postage prepaid, or (iv) when transmitted by facsimile so long as the sender obtains
written electronic confirmation from the sending facsimile machine that such
transmission was successful.
12. No Joint Venture. Nothing in this Agreement shall, or shall be deemed
or construed to, create or constitute any joint venture, partnership, agency,
employment, or any other relationship between the City and Company nor to create any
liability for one party with respect to the liabilities or obligations of the other party or any
other person.
13. Amendment, Modification, and Waiver. No amendment, modification,
or waiver of any condition, provision, or term of this Agreement shall be valid or of any
effect unless made in writing, signed by the party or parties to be bound or by the duly
authorized representative of same, and specifying with particularity the extent and
nature of the amendment, modification, or waiver. Any waiver by any party of any
default by another party shall not affect or impair any rights arising from any subsequent
default.
14. Severability. Each provision, section, sentence, clause, phrase, and
word of this Agreement is intended to be severable. If any portion of this Agreement
shall be deemed invalid or unenforceable, whether in whole or in part, the offending
provision or part thereof shall be deemed severed from this Agreement and the
remaining provisions of this Agreement shall not be affected thereby and shall continue
in full force and effect. If, for any reason, a court finds that any portion of this
Agreement is invalid or unenforceable as written, but that by limiting such provision or
portion thereof it would become valid and enforceable, then such provision or portion
thereof shall be deemed to be written, and shall be construed and enforced, as so
limited.
15. Captions. All captions, headings, or titles in the paragraphs or sections
of this Agreement are inserted only as a matter of convenience and/or reference, and
they shall in no way be construed as limiting, extending, or describing either the scope
or intent of this Agreement or of any provisions hereof.
16. Binding Effect. This Agreement shall be binding and shall inure to the
benefit of the parties and their respective successors, assigns, and legal
representatives.
17. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which, taken
together, shall constitute one and the same instrument.
18. Entire Agreement. This Agreement, together with the Minimum
Assessment Agreement attached hereto as Exhibit '`B", constitutes the entire
agreement of the parties and supersedes all prior or contemporaneous negotiations,
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discussions, understandings, or agreements, whether oral or written, with respect to the
subject matter hereof.
19. Time of Essence. Time is of the essence of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Development
Agreement by their duly authorized officers as of the date first set forth above.
CITY OF WATERLOO, IOWA CARDINAL CONSTRUCTION, INC.
By:
Quentin Hart, Mayor
Attest:
7
By
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Title: (`J,2ir.5trJ,'-c.,,c,c
Exhibit "A"
Legal Description of Property:
All that portion of the property described in a Warranty Deed recorded as File Number 2009 00024074
in the Black Hawk County Recorder's Office lying within the Northeast Quarter (NE 1/4) of the Southeast
Quarter (SE 1/4) of Section 32, Township 89 North, Range 13 West of the 5th P.M., in the City of
Waterloo, Black Hawk County.
EXHIBIT "B"
MINIMUM ASSESSMENT AGREEMENT
This Minimum Assessment Agreement (the "Agreement") is entered into as of
this "1 day of (>5 vC �:,S,'"-' , 2017, by and among the CITY OF
WATERLOO, IOWA ("City''', Cardinal Construction, Inc. (an Iowa Corporation
("Developer"), and the COUNTY ASSESSOR of the City of Waterloo, Iowa
("Assessor").
WITNESSETH:
WHEREAS, on or before the date hereof the City and Developer have entered
into a development agreement (the "Development Agreement") regarding certain real
property, described in Exhibit "A" thereto, located in the City; and
WHEREAS, it is contemplated that pursuant to the Development Agreement, the
Developer will undertake the development of an area ("Project") within the City and
within the "Martin Road Development Area"; and
WHEREAS, pursuant to Iowa Code § 403.6, as amended, the City and the
Developer desire to establish a minimum actual value for the land and the building(s)
pursuant to this Agreement and applicable only to the Project, which shall be effective
upon substantial completion of the Project and from then until this Agreement is
terminated pursuant to the terms herein and which is intended to reflect the minimum
actual value of the land and buildings as to the Project only; and
WHEREAS, the City and the Assessor have reviewed the preliminary plans and
specifications for the improvements (the "Improvements") which the parties contemplate
will be erected as a part of the Project.
NOW, THEREFORE. the parties hereto, in consideration of the promises,
covenants, and agreements made by each other, do hereby agree as follows:
1. Upon substantial completion of construction of the Improvements by the
Developer, the minimum actual taxable value which shall be fixed for assessment
purposes for the land and Improvements to be constructed thereon by the Developer as
a part of the Project shall not be less than $1,100,000.00 ("Minimum Actual Value") until
termination of this Agreement. The parties hereto agree that construction of the
Improvements will be substantially completed on or before December 31, 2020.
2. The Minimum Actual Value herein established shall be of no further force
and effect, and this Minimum Assessment Agreement shall terminate, on December 31,
2030. Nothing herein shall be deemed to waive the Developer's rights under Iowa
Code § 403.6, as amended, to contest that portion of any actual value assignment
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made by the Assessor in excess of the Minimum Actual Value established herein. In no
event, however, shall the Developer seek or cause the reduction of the actual value
assigned below the Minimum Actual Value established herein during the term of this
Agreement.
3. This Agreement shall be promptly recorded by the City with the Recorder
of Black Hawk County, Iowa. The City shall pay all costs of recording.
4. Neither the preambles nor provisions of this Agreement are intended to, or
shall be construed as, modifying the terms of the Development Agreement.
5. This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of the parties.
ATTEST:
By:
Kelley Fe le, City Clerk
STATE OF IOWA
) ss.
COUNTY OF BLACK HAWK
On this 1.D day of _ , 2017, before me, a Notary Public
in and for the State of Iowa, personally aHpeared Quentin Hart and Kelley Felchle, to
me personally known, who being duly sworn, did say that they are the Mayor and City
Clerk, respectively, of the City of Waterloo, 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
CITY OF WATERLOO, IOWA
By:
Quentin Hart, Mayor
Cardinal Construction, Inc. Corporation
By:
c---11c—e M. wiowe.a =
Title:r�sr,p,
2
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 and by them voluntarily executed.
NANCY HIGBY
COMMISSION NO.788229
MY COMMISSION EXPIRES
STATE OF IOWA
COUNTY OF BLACK HAWK
)
) ss.
Notary Public
Acknowledged before me on /5.147 /144.9aSiz- , 2017 by -.).;V7 ,, ; & ,,-/L'
as Rj-e.6iden-l-- of Cardinal Construction, Inc.
DEBRA MATTIX
COMMISSION NO. 770249
MY /OIMI$S5 EXPIRES
-71'Ia-if
Notary Public
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CERTIFICATION OF ASSESSOR
The undersigned, having reviewed the plans and specifications for the improvements to
be constructed and the market value assigned to the land upon which the
improvements are to be constructed for the development, and being of the opinion that
the minimum market value contained in the foregoing Minimum Assessment Agreement
appears reasonable, hereby certifies as follows: The undersigned Assessor, being
legally responsible for the assessment of the property subject to the development, upon
completion of improvements to be made on it and in accordance with the Minimum
Assessment Agreement, certifies that the actual value assigned to such land, building
and equipment upon completion of the development shall not be less than One Million
One Hundred Thousand Dollars ($1,100,000.00).
Ass` 'or for Black Hawk County, Iowa
Date
STATE OF IOWA
) ss.
COUNTY OF BLACK HAWK
Subscribed and sworn to before me on
1 b , 2017, by T.J.
Koenigsfeld as Assessor for Black Hawk County, Iowa.
ADRIENNE MILLER
COMMISSION NO. 809109
MY COMMISSION EXPIRES
FEBRUARY 23, 2021
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/t1,twti ria-avL.,
otary Public