HomeMy WebLinkAboutJohn & Dan Properties, LLC - Dev Agmnt(RECORDED) 111111111 II 111111111111111111111
Doc ID: 011967370013 Type: GEN
Recorded: 06/29/2023 at 11:16:25 AM
Fee Amt: $67.00 Page 1 of 13
Black Hawk County Iowa
SANDIE L. SMITH RECORDER
File2023-00017581
,tio, c
Prepared by Christopher S.Wendland,P.O. Box 596.Waterloo, IA 50704 Phone(319)234-5701
DEVELOPMENT AGREEMENT
This Development Agreement (the "Agreement") is entered into as of
May 15 , 2023 by and between John & Dan Properties, LLC (the "Company")
and the City of Waterloo, Iowa (the "City").
RECITALS
A. City considers economic development within the City to be 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, and the City
further believes that the project is in the vital and best interests of the City
and that the project and such incentives are in accordance with the public
purposes and provisions of applicable State and local laws and
requirements under which the project has been undertaken and is being
assisted.
B. Company is the owner of real property as described and set forth on
Exhibit "A" attached hereto, located within the corporate limits of the City
of Waterloo, Iowa (the "Property").
C. Company is willing and able to finance and construct the installation of
roads, related infrastructure, and other improvements and to plat and
subdivide the Property (collectively, the "Project") on the Property, which is
located in the San Marnan Development Plan urban renewal area.
D. In view of the Company's investment in assembling the Project and its
commitment to develop the Property, the City desires to provide certain
incentives to encourage the Company to facilitate timely development of
the Property.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants set forth herein,
the parties agree as follows:
1. Improvements by Company. Company shall construct, or cause to be
constructed, all streets, sewers, utilities, and water lines on the Property as generally
depicted on Exhibit "B" attached hereto (all such street and infrastructure improvements
and related site preparation, including, but not limited to, necessary grading, fill, and
earth work for such street improvements, are referred to as the "Street Improvements").
Company shall provide all information requested by City that is reasonably necessary to
verify that the Street Improvements were properly constructed and are eligible for
acceptance. In addition to construction of the Street Improvements, Company shall plat
and subdivide the Property into multiple lots for development by Company or by third
parties and shall act with diligence to market said lots for sale and development.
Company agrees that the Improvements shall be constructed in accordance with the
terms of this Agreement, the San Marnan Development Plan, and all applicable City,
state, and federal building codes and shall comply with all applicable City ordinances
and other applicable law. City may require that Company submit specific designs and
site plans for City review and approval. Company 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 before the Improvements
may be lawfully constructed. The Property, the Street Improvements, and all site
preparation and development-related work to make any of the Property usable for
Company's purposes as contemplated by this Agreement are collectively referred to as
the "Project".
2. Construction Plans. Company agrees that it will cause the Street
Improvements to be constructed on the Property in conformance with construction plans
(the "Plans") that have been submitted to the City. Company agrees that the scope and
scale of the Street Improvements to be constructed shall not be significantly less than
the scope and scale of such improvements as detailed and outlined in the Plans.
If any material modification in the scope, scale or nature of the Plans is
proposed, Company shall submit Modified Plans (the "Modified Plans") to the City for
review. Modified Plans shall be subject to approval by the City as provided in this
Section. City shall approve the Modified Plans in writing if: (a) the Modified Plans
conform to the terms and conditions of this Agreement; (b) the Modified Plans conform
to the terms and conditions of the urban renewal plan; (c) the Modified Plans conform to
all applicable federal, state and local laws, ordinances, rules and regulations and City
permit and design review requirements; (d) the Modified Plans are adequate for
purposes of this Agreement to provide for the construction of the Street Improvements,
and (e) no Event of Default under the terms of this Agreement has occurred; provided,
however, that any such approval of the Plans or Modified Plans pursuant to this Section
shall constitute approval for the purposes of this Agreement only and shall not be
deemed to constitute approval or waiver by the City with respect to any building, fire,
zoning or other ordinances or regulations of the City.
The Modified Plans must be rejected in writing by City within thirty (30)
days of submission or shall be deemed to have been approved by the City. If City
2
rejects the Modified Plans in whole or in part, Company shall submit new or corrected
Modified Plans within thirty (30) days after receipt by Company of written notification of
the rejection, accomplished by a written statement of the City specifying the respects in
which Company's Modified Plans fail to conform to the requirements of this Section.
The provisions of this Section relating to approval, rejection and resubmission of
corrected Modified Plans shall continue to apply until the Modified Plans have been
approved by the City; provided, however, that in any event Company shall submit
Modified Plans which are approved by City prior to commencement of construction of
the additional or modified Street Improvements.
Approval of the Plans or Modified Plans by the City shall not relieve
Company of any obligation to comply with the terms and provisions of this Agreement,
or the provision of applicable federal, state and local laws, ordinances and regulations,
nor shall approval of the Plans or Modified Plans by City be deemed to constitute a
waiver of any Event of Default. Approval of Plans or Modified Plans hereunder is solely
for purposes of this Agreement and shall not constitute approval for any other City
purpose nor subject the City to any liability for the Street Improvements as constructed.
3. Timeliness. To be eligible for the incentives provided by this Agreement,
Company must complete construction of all of the Street Improvements and must plat
and subdivide the Property within twelve (12) months from the date of this Agreement.
If all Street Improvements are not accepted by City within eighteen (18) months from the
date of this Agreement, then the grant payments provided for in Section 4 shall be
suspended until acceptance of the Street Improvements. City will accept the Street
Improvements only if(a) Company has posted a two-year maintenance bond with
respect to the Street Improvements or (b) Company has already entered into an
agreement for completion of improvements that provides for such a bond.
4. Grants to Company. As an inducement for Company to undertake the
Project, the City agrees to make development grant payments (each a "Grant") to
Company as follows, subject to the other terms of this Agreement:
A. A semi-annual Grant in an amount equal to 100% of the property
taxes collected by City (excluding Non-TIF Collections as defined in paragraph
4.0 below) from land valuations on the subject properties and minimum
assessment agreements for land valuation with a party making improvements on
the Property (a "Developer") pursuant to a separate development agreement with
City, reduced by any and all tax rebates that City is required to pay to the
Developer pursuant to the terms of any development agreement with such
Developer. For purposes of illustration only, if an agreement between City and a
Developer provides for rebatement of 50% of qualifying property taxes for a
period of five years, then Company would receive a Grant equal to the remaining
50% of qualifying property taxes in each year of such period. No Grant with
respect to such Developer's improvements to a parcel of land for a project shall
be made to Company before a property tax rebate is first paid to the Developer.
At the end of the Developer's tax rebatement period, City will make a semi-
annual Grant to Company in an amount equal to 100% of qualifying property
3
taxes until Company has been paid pursuant to paragraph 4.F below. For
purposes of this paragraph, the term "Developer" may include Company with
respect to improvements made on the Property other than the improvements that
are the subject of this Agreement.
B. With respect to any taxable improvements constructed on the
Property that are not subject to a separate development agreement between City
and the owner-builder thereof (referred to as "Non-Qualifying Improvements",
which are further explained below), a semi-annual Grant in an amount equal to
100% of the property taxes collected by City (excluding Non-TIF Collections), if
not for the non-qualifying character of the improvements, starting in "Year One"
and continuing thereafter until Company has been paid pursuant to paragraph
4.F below. The Grant shall be determined with reference to taxes paid on the
increased valuation of the subject property over the base valuation as of January
1, 2022. For purposes of illustration, a "Non-Qualifying Improvement" means,
generally, an improvement of a type that is not eligible for property tax rebates or
similar incentives, such as property that is or becomes exempt from taxation, or
other classifications of property determined from time to time as ineligible by City
policy. "Year One" shall be the first year for which the assessment is based upon
the partial or completed value of the Non-Qualifying Improvements, but not a
prior year for which the assessment is based solely upon the value of the land.
C. Expressly excluded from the above-described grant and rebate
program is 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 (collectively, "Non-TIF Collections").
D. Grants to Company are payable in respect of a given year only to
the extent that general property taxes that are due and owing for such year have
actually been paid. The City will pay Grants semi-annually. The Company
reserves the right to assign the semi-annual payments to a lender as an
assignment of Grant payments.
E. In respect of any Grant amount that is determined from time to
time, payment shall be made within a reasonable time following the tax
installment payment due date, provided that the tax installment was actually paid
and Company has submitted proof of payment to City or has otherwise notified
City of completed payment in a manner that is satisfactory to City.
F. Notwithstanding anything to the contrary in this Section 4, City will
pay to Company a minimum annual Grant amount of$40,000.00, but in no event
will the cumulative amount of Grants payable by City to Company under this
Agreement exceed $2,020,040.00 (the "Grant Maximum"), nor shall Grants be
paid for a period longer than fifteen (15) years starting from the earlier of(i) "Year
One" as defined in any development agreement described in paragraph A above
or (ii) "Year One" as defined in paragraph B above. Said 15-year period shall
commence only once with respect to all Grants that may be paid hereunder and
4
shall not commence anew or separately with each development event that could
provide funds for Grant payments. If the Grant Maximum has not been fully paid
before the end of said 15-year period, then City will take necessary actions to
extend or renew the tax increment financing district for an additional period
sufficient to provide for such payment.
G. Each Grant payment is subject to annual appropriation by the city
council each fiscal year. City has no obligation to make any payments to
Company as contemplated under this Agreement until the city council annually
appropriates the funds necessary to make such payments. The right of non-
appropriation reserved to City in this paragraph is intended by the parties, and
shall be construed at all times, so as to ensure that City's obligation to make
future Grant payments shall not constitute a legal indebtedness of City within the
meaning of any applicable constitutional or statutory debt limitation prior to the
adoption of a budget which appropriates funds for the payment of that installment
or amount. In the event that any of the provisions of this Agreement are
determined by a court of competent jurisdiction or by City's bond counsel to
create, or result in the creation of, such a legal indebtedness of City, the
enforcement of the said provision shall be suspended, and the Agreement shall
at all times be construed and applied in such a manner as will preserve the
foregoing intent of the parties, and no event of default by City shall be deemed to
have occurred as a result thereof. If any provision of this Agreement or the
application thereof to any circumstance is so suspended, the parties will
negotiate in good faith how to continue development of the property.
H. Notwithstanding the provisions set forth above, City shall have no
obligation to make a payment of a Grant to Company if(i) at any time during the
term hereof City fails to appropriate funds for payment; (ii) City receives an
opinion from its legal counsel to the effect that the use of Tax Increments to fund
a Grant payment to Company is not, based on a change in applicable law or its
interpretation since the date of this Agreement, authorized or otherwise an
appropriate urban renewal activity permitted to be undertaken by City under the
Iowa Urban Renewal Act or other applicable provisions of state law, as then
constituted or under controlling decision of any Iowa court having jurisdiction over
the subject matter hereof; or (iii) City's ability to collect Tax Increment is
precluded or terminated by legislative changes to Iowa Code Chapter 403. Upon
occurrence of any of the foregoing circumstances, City shall promptly forward
notice of the same to Company. If the circumstances continue for a period
during which two (2) annual Grant payments would otherwise have been paid to
Company under the terms above, then City may terminate this Agreement,
without penalty or other liability to City, by written notice to Company. For
purposes of this Agreement, "Tax Increments" shall mean the property tax
revenues on the improvements and property in the San Marnan Development
Plan area that are received by and made available to City for deposit in an
account maintained under this Agreement, the provisions of Iowa Code § 403.19
and the ordinance governing the San Marnan Development Plan.
5
5. 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.
6. Covenants of Company. In addition to the other promises, covenants
and agreements of Company as provided elsewhere in this Agreement, Company
agrees as follows with respect to each phase of Improvements:
A. Until the Street Improvements are substantially completed,
Company shall make such reports to City, in such detail and at such times as
may be reasonably requested by City, as to the actual progress of Company with
respect to construction of the Street Improvements.
B. Company will cooperate fully with City in resolution of any traffic,
parking, trash removal or public safety problems which may arise in connection
with the construction and operation of the Improvements.
7. Indemnification and Releases.
A. Company hereby releases City, its elected officials, officers,
employees, and agents (collectively, 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
the Property and arising from construction activities or any defect in the design or
construction of the Street Improvements. The indemnified parties shall not be
liable for any damage or injury to the persons or property of Company or its
directors, officers, employees, contractors or agents, or any other person who
may be about the Property or the Street Improvements, due to any act of
negligence or willful misconduct of any person, other than any act of negligence
or willful misconduct on the part of any such indemnified party or its officers,
employees or agents.
Except for any willful misrepresentation, any willful misconduct, or any unlawful
act of the indemnified parties, Company 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 or
any type or nature whatsoever by any person or entity whatsoever that arises or
purportedly arises from (1) any violation by Company of any agreement or
condition of this Agreement (except with respect to any suit, action, demand or
other proceeding brought by Company against the City to enforce its rights under
this Agreement), or (2) the construction or installation of the Street Improvements
by Company.
6
B. The provisions of this Section shall survive the expiration or
termination of this Agreement.
8. 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.
9. 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.
10. Default. The following shall be "Events of Default" under this Agreement,
and the term "Event of Default" shall mean any one or more of the following events that
continues beyond any applicable cure periods:
A. Failure by Company to cause the construction of the Street
Improvements to be commenced and completed pursuant to the terms,
conditions and limitations of this Agreement;
B. Failure by any party hereto to substantially observe or perform any
covenant, condition, obligation or agreement on its part to be observed or
performed under this Agreement;
C. Company (1) files any petition in bankruptcy or for any
reorganization, arrangement, composition, readjustment, liquidation, dissolution,
or similar relief under the federal bankruptcy law or any similar state law; (2)
makes an assignment for the benefit of its creditors; (3) admits in writing its
7
inability to pay its debts generally as they become due; (4) is adjudicated a
bankrupt or insolvent; or if a petition or answer proposing the adjudication of
Company 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 Company, or part
thereof, shall be appointed in any proceedings brought against Company and
shall not be discharged within ninety (90) days after such appointment, or if
Company shall consent to or acquiesce in such appointment; or (5) defaults
under any mortgage applicable to any of Property.
D. Any representation or warranty made by Company or City in this
Agreement, or made by Company or City in any written statement or certificate
furnished by Company or City 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.
11. Remedies.
A. Default by Company. Whenever any Event of Default in respect of
Company occurs and is continuing, the City may terminate this Agreement.
Before exercising such remedy, City shall give 30 days' written notice to
Company of the Event of Default, provided that by the conclusion of such period
the Event of Default shall not have been cured, or if the Event of Default cannot
reasonably be cured within 30 days and Company shall not have provided
assurances reasonably satisfactory to the City that the Event of Default will be
cured as soon as reasonably possible. Upon termination, City may exercise any
and all remedies available at law, equity, contract or otherwise for recovery of
any sums paid by City to Company before the date of termination.
B. Default by City. Whenever any Event of Default in respect of City
occurs and is continuing, Company may take such action against City to require
it to specifically perform its obligations hereunder. Before exercising such
remedy, Company shall give 30 days' written notice to City of the Event of
Default, provided that by the conclusion of such period the Event of Default shall
not have been cured, or if the Event of Default cannot reasonably be cured within
30 days and City shall not have provided assurances reasonably satisfactory to
the Company that the Event of Default will be cured as soon as reasonably
possible.
C. Remedies under this Agreement shall be cumulative and in addition
to any other right or remedy given under this Agreement or existing at law or in
equity or by statute. Waiver as to any particular default, or delay or omission in
exercising any right or power accruing upon any default, shall not be construed
as a waiver of any other or any subsequent default and shall not impair any such
right or power.
8
12. Materiality of Parties' Promises, Covenants, Representations, and
Warranties. Each and every promise, covenant, representation, and warranty set forth
in this Agreement on the part of the parties to be performed is a material term of this
Agreement, and each and every such promise, covenant, representation, and warranty
constitutes a material inducement for the other party to enter this Agreement. The
parties acknowledge that without such promises, covenants, representations, and
warranties, the other party would not have entered this Agreement. Upon breach of any
promise or covenant, or in the event of the incorrectness or falsity of any representation
or warranty, the other party may, at its sole option and in addition to any other right or
remedy available to it, terminate this Agreement and declare it null and void.
13. Performance by City. Company acknowledges and agrees that all of the
obligations of City under this Agreement shall be subject to, and performed by City in
accordance with, all applicable statutory, common law or constitutional provisions and
procedures consistent with City's lawful authority. All covenants, stipulations, promises,
agreements and obligations of City contained in this Agreement shall be deemed to be
the covenants, stipulations, promises, agreements and obligations of City and not of any
governing body member, officer, employee or agent of City in the individual capacity of
such person.
14. No Third-Party Beneficiaries. No rights or privileges of any party hereto
shall inure to the benefit of any contractor, subcontractor, material supplier, or any other
person or entity, and no such contractor, subcontractor, material supplier, or other
person or entity shall be deemed to be a third-party beneficiary of any of the provisions
of this Agreement.
15. 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 Com any, at 7404 University Avenue, Cedar Falls, IA 50613,
facsimile number 1. , Attention:
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
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. A party may change the address for giving notice by any
method set forth in this section.
9
16. Relationship of Parties. 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.
17. 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.
18. Severability; Reformation. Except as otherwise specifically provided for
in this Agreement, 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.
19. 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.
20. Interpretation. This Agreement shall not be construed more strictly
against one party than against the other merely by virtue of the fact that it may have
been prepared by counsel for one of the parties, it being recognized that the parties
hereto and their respective attorneys have contributed substantially and materially to the
preparation of each and every provision of this Agreement.
21. Binding Effect. This Agreement shall be binding upon and shall inure to
the benefit of the parties and their respective successors, assigns, and legal
representatives.
22. 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.
23. Entire Agreement. This Agreement constitutes the entire agreement of
the parties and supersedes all prior or contemporaneous negotiations, discussions,
10
understandings, or agreements, whether oral or written, with respect to the subject
matter hereof.
24. 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 representatives as of the date first set forth above.
[signatures on next page]
11
CITY OF WATERLOO, IOWA JOHN & N PROPERTIES, LLC
By: Quer/iv/ r By:
Quentin Hart, Mayor Mg
Attest: Xely Ee(ch[e
Kelley Felchle, City Clerk
12
EXHIBIT "A"
Legal Description of Property
That part of the East One-half of the Northwest Quarter of Section 9, Township 88 North, Range 13 West
of the 5th P.M., Black Hawk County, Iowa, lying Southerly of the Southerly right-of-way line of San
Maman Drive and lying Northerly of the Northerly right-of-way line of U.S. Highway#20, except that
deeded in Doc. #2006-04226 and except that part of the Northeast Quarter of said Northwest Quarter
condemned in Doc. #2006-18278