HomeMy WebLinkAboutCedar Valley Restoration and Development, LLC - Development Agreement - 10/23/2006 5'33
DEVELOPMENT AGREEMENT
This Agreement is made and entered into this23`d day ofbc7�0 f-f , 2006, by
and between Cedar Valley Restoration and Development, L.L.C. (the "Developer"), and
City of Waterloo (the "City").
WHEREAS, City considers economic development and the creation of affordable
housing redevelopment of the Rath Urban Renewal and Redevelopment Plan Area
within the City a benefit to the community and is willing for the overall good and welfare
of the community to provide vacant land so as to encourage that goal, and
WHEREAS, Developer is willing and able to purchase real property and to
develop housing on property (the Property ) located in the Rath Urban Renewal and
Redevelopment Plan, generally located at the northeast corner of the East 8th and
Sycamore Street intersection, and legally described on attached Exhibit "A'.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
contained, Developer and City agree as follows:
1. Sale of Property. The City shall convey or cause to be conveyed the
Property to Developer for the sum of $20,200.00. This sum will be paid to the City of
Waterloo on a pro-rated basis (i.e., $5,050.00 per unit) at the time that Developer sells
or leases a unit to a third party. Developer shall construct four (4) multi-story housing
units consisting of approximately 1 ,200 square feet each, and related improvements
(collectively, the "Improvements") on the Property. The Improvements are to be
constructed in accordance with all applicable City, State, and Federal building codes
and be in compliance with all applicable City ordinances and other applicable law. It is
contemplated that the Improvements should have an estimated total project cost of
$500,000 and be built as shown on the attached site plan labeled as Exhibit "B". The
Property, the Improvements, and all site preparation and development-related work to
make the Property usable for Developer's purposes as contemplated by this Agreement
are collectively referred to as the "Project". Each separate housing unit and the
corresponding subdivided portion of the Property on which the unit is constructed is a
"Project Phase" and such subdivided portion of the Property is a "Project Phase Parcel."
2. Construction; Reversion. The parties agree that Developer's commitment
to undertake the Project and to construct the Improvements in timely fashion constitutes
a material inducement for the City to convey the Property to Developer and that without
said commitment City would not have conveyed the Property. As marked from the date
that the Property is deeded to Developer, Developer must obtain a building permit and
begin construction on the first home within twelve (12) months, the second home within
twenty-four (24) months, the third home within thirty-six (36) months, and the fourth
home within forty-eight (48) months. All construction must be completed within fifty-four
(54) months of such date. If Developer has not begun in good faith the construction of
the building described above upon a Project Phase Parcel in accordance with the
schedule just stated, then title to such Project Phase Parcel will revert to City. If
construction has not begun at the end of any such prescribed period, but the
development of the Project Phase 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
for such Project Phase. If, during the term of this Agreement, Developer determines
the Project or any Project Phase to not be economically feasible, Developer may, after
giving thirty (30) days written notice to City, deed the Property or any Project Phase
Parcel(s) back to the City with no further obligation to either party. If development has
commenced within the prescribed 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 Developer, the requirement that construction is to be
completed within twenty-four (24) months 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 or Project Phase Parcel(s) shall
revert to the City. In the event that title to the Property or any Project Phase Parcel
shall revert to the City pursuant to the provisions of this Section 2, Developer agrees
that it shall, at its own expense, promptly execute all documents or take such other
actions as the City may reasonably request to effectuate said reversion, and Developer
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 Developer's failure to carry on or complete
same and said Property or Project Phase Parcel shall be returned with no liens or
encumbrances caused by the Developer.
2.1 Platting and Release. In connection with the Project, Developer shall
plat the Property as required by City's subdivision ordinance into no less than four lots,
one for each building to be constructed. In connection with Developer's sale of any lot,
City shall release such lot from the conditions and restrictions of this Agreement. The
release of any given lot shall not affect the applicability or operation of this Agreement
as to any lot that has not already been specifically released.
2.2 Subordination of City's Rights. If requested by Developer's
construction lender (a "Lender"), City agrees to execute any document reasonably
necessary to subordinate its rights under this Agreement to the Lender. Any document
of subordination shall, at minimum, include the following provisions:
A. Subordination of rights with respect to a given lot shall be
conditioned upon Developer's actual commencement of
construction of Improvements on such lot.
B. City shall be permitted to assert, enforce, or exercise any
subordinated rights following 30-days' prior written notice to the
Lender, unless within such 30-day period Lender delivers written
objection to City, which objection shall not be unreasonably made.
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C. Subordination shall automatically terminate, without further notice
or action, immediately upon Lender's release or assignment of its
mortgage on the Property and Improvements.
3. Deed; Title. The City shall convey or cause to be conveyed fee simple
title to the Property by quit claim deed, free and clear of all encumbrances except: (a)
easements, conditions, and restrictions of record which do not, in Developer's opinion,
interfere with Developer's proposed use; (b) current and future 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 and other applicable law. City shall not be obligated to deliver a deed or
other conveyance documents to Developer until Developer delivers to City reasonable
and satisfactory proof of financial ability to undertake and carry on the Project, which
proof may take the form of a lending commitment letter. Developer shall, at its own
expense, prepare an updated abstract of title, or in lieu thereof Developer may, at its
own expense, obtain whatever form of title evidence it desires. If title is unmarketable
or subject to matters not acceptable to Developer, and if City does not remedy or
remove such objectionable matters in timely fashion following written notice of such
objections from Developer, Developer may terminate this Agreement. City shall provide
any title documents it has in its possession, including any abstracts, to assist in title
preparation.
4. Tax Exemptions and Development Grants.
A. In lieu of certain tax rebates, Developer agrees to apply to have the added
taxable value of the Improvements for each Project Phase receive an exemption from
taxation as provided in Iowa Code Chapter 404. City represents that the Property is
located in an urban revitalization area that has been designated as such by the City in
the exercise of its authority pursuant to Iowa Code Chapter 404.
B. Provided that Developer has completed the Improvements for a Project
Phase as set forth in Section 2, has executed a minimum assessment agreement with
respect to such Project Phase as set forth in Section 5 below, and has met the
conditions stated in Section 4.0 below, the City agrees to use fifty percent (50%) of the
tax increment financing revenues in respect of the Project Phase Parcel for streetscape
improvements to East 8th Street and fifty percent (50%) for additional grants to
Developer to facilitate improvements to the Project site. The funding program
described in this Section 4.B shall commence with the first full fiscal year for which the
assessment in respect of a Project Phase 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 Project Phase Parcel or upon the value of the Project Phase Parcel and a
partial value of the Improvements due to partial completion of the Improvements or a
partial tax year. City's obligations under this Section 4.13 shall continue for a period of
ten (10) fiscal years. Tax increment financing revenues do not include 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.
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C. 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
$500.00 over the January 1, 2006 taxable value of the land of $10,730.
5. Minimum Assessment Agreement. Developer acknowledges and
agrees that it will pay when due all taxes and assessments, general or special, and all
other charges whatsoever levied upon or assessed or placed against the Property or a
Project Phase Parcel, and further agrees that prior to the date set forth in Section 2 of
Exhibit C, it will not seek or cause a reduction in the taxable valuation for the Property
or a Project Phase Parcel, which shall be fixed for assessment purposes, below the
aggregate amount of $320,000.00, or $80,000.00 per Project Phase Parcel, ("Minimum
Actual Value"), through:
(i) willful destruction of the Property, the improvements thereon, 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.
Developer agrees to sign said attached Exhibit "C" for each separate Project Phase
before completion of Improvements for such Project Phase.
6. 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.
7. Representations and Warranties of Developer. Developer hereby
represents and warrants as follows:
A. Developer is not prohibited from consummating the transaction
contemplated in this Agreement by any law, regulation, agreement, instrument,
restriction, order or judgment.
B. Developer is duly organized, validly existing, and in good standing
under the laws of the State of Iowa.
C. Developer 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
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to be delivered to City hereunder is and shall be authorized to do so on behalf of
Developer.
8. 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 Developer nor to create
any liability for one party with respect to the liabilities or obligations of the other party or
any other person.
9. Notices. Any notice under this Agreement shall be in writing and shall be
delivered in person, by overnight delivery 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, to City Hall 715 Mulberry Street, Waterloo, Iowa 50703,
facsimile number 291-4262, Attention: Mayor, with copies to the City Attorney
and City Planner.
(b) if to Developer, to David Deeds, 922 Mulberry St, Waterloo, Iowa
50703, facsimile number 319-433-0210, email david.deeds@collegestreet.info.
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
delivery service which guarantees next day delivery, (iii) three (3) business days
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 trans-
mission was successful.
10. 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 its duly
authorized representative, 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.
11 . 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.
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12. 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.
13. Binding Effect. This Agreement shall be binding and shall inure to the
benefit of the parties and their respective successors, assigns, and legal
representatives.
14. 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.
15. Entire Agreement. This Agreement, together with the Minimum
Assessment Agreement attached hereto as Exhibit "C", constitutes the entire
agreement of the parties and supersedes all prior or contemporaneous negotiations,
discussions, understandings, or agreements, whether oral or written, with respect to the
subject matter hereof.
16. Time of Essence. Time is of the essence of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Development
Agreement as of the date written above.
Cedar Valley Restoration & Development
By:
/0/yoo
David Deeds Date
City of Waterloo, Iowa
By: 1012 3 /o6
imothy J. H rl , Mayor Date
Attest � h)/a3 A6
Nancy eke ity Clerk Date
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EXHIBIT "A"
Lots 6, 7 and 10, Block 18, Original Plat of East Waterloo, City of Waterloo, Black
Hawk County, Iowa.
EXHIBIT "B"
Proposed Development Site Plan
Note: Site plan as proposed is subject to CVRD receiving all necessary approvals from
the City of Waterloo and making a final determination of economic feasibility.
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EXHIBIT "C"
MINIMUM ASSESSMENT AGREEMENT
THIS MINIMUM ASSESSMENT AGREEMENT, dated as of this day of
, 2006, by and among the CITY OF WATERLOO, IOWA, ("City"), Cedar
Valley Restoration and Development, L.L.C., ("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 "Agreement") regarding certain real property
located in the City; and
WHEREAS, it is contemplated that pursuant to said Agreement, the Developer
will undertake the development of an area ("Project") in phases (each a "Project
Phase") within the City and within the "Rath Urban Renewal and Redevelopment Plan."
WHEREAS, pursuant to Iowa Code section 403.6, as amended, the City and the
Developer desire to establish a minimum actual value for the land and building thereon
pursuant to the Agreement and applicable only to the Project Phase, which shall be
effective upon substantial completion of the Project Phase 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 building as to the Project Phase only; and
WHEREAS, the City and the Assessor have reviewed the preliminary plans and
specifications for the improvements contemplated to be erected as a part of the Project.
NOW, THEREFORE, the parties to this Minimum Assessment Agreement, 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 Project Phase on the
property described in Exhibit "A" attached hereto, 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
$320,000.00 aggregate, or $80,000.00 per Project Phase, ("Minimum Actual Value")
until termination of this Minimum Assessment Agreement. The parties hereto agree the
construction of the Project Phase will be substantially completed on or before
January 1,
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,
[insert date that is end of 5th year after phase completion date].
Nothing herein shall be deemed to waive the rights or the Developer under Iowa
Code section 403.6(19), as amended, to contest that portion of any actual value
assignment 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. The City shall not unreasonably withhold its consent to permit
the Developer to contest its taxable valuations in full, commencing with the assessment
of January 1, [insert date that is January 1 of the next year after the date in
the preceding paragraph of this Section]
3. This Minimum Assessment Agreement shall be promptly recorded by the
City with the Recorder of Black Hawk County, Iowa, the City paying all costs of
recording.
4. Neither the recitals nor provisions of this Minimum Assessment
Agreement are intended to, or shall be construed as, modifying the terms of the
Agreement between the City and the Developer.
5. This Minimum Assessment Agreement shall inure to the benefit of and be
binding upon the successors and assigns of the parties.
CITY OF WATERLOO, IOWA
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By:
Timothy J. Hurle or
ATTEST:
Nancy Eckert ity Clerk
Cedar Valley Restoration and
Development,, L.L.C.
David Deeds, Managing Member
STATE OF IOWA )
COUNTY OF BLACK HAWK
On this � day of C 'w before me a Notary Public
in and for the State of Iowa, personally appeared Timothy J. Hurley and Nancy Eckert
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 its City Council and said Mayor and City Clerk acknowledged said instrument to be
the free act and deed of said Municipal Corpora ion by it and by them voluntarily
executed.
Notary'Public, State of Iowa
STATE OF IOWA, BLACK HAWK COUNTY, ss:
Signed before me on OU 3 , aom- , by David Deeds as Managing
Member of Cedar Valley Restoration and Development, L.L.C.
&-k-166
Notary Public, State 6f Iowa
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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 Eighty Thousand Dollars ($80,000.00).
Assessor for Black Hawk County, Iowa
Date
STATE OF IOWA )
COUNTY OF BLACK HAWK )
Subscribed and sworn to before me by
Assessor for Black Hawk County, Iowa.
Notary Public, State of Iowa
Date
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