HomeMy WebLinkAboutCardinal Construction, Inc.-Development Agreement-08.11.2008 DEVELOPMENT AGREEMENT
This Development Agreement (the "Agreement") is entered into as of
gccI�j us i // , 2008, by and between Cardinal Construction Inc. ("Company"), and
the`City of Waterloo, Iowa ("City").
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 San Marnan urban
renewal area.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants set forth herein,
the parties agree as follows:
1. Purchase of Property. Company is purchasing the real property
described on Exhibit "A" attached hereto (the "Property"). The purchase price for the
Property is $918,244.00 (the "Purchase Price"). Company shall take all steps
necessary or advisable to complete the purchase of the Property and to obtain
marketable title thereto as promptly as possible.
2. Improvements by Company. Company shall construct on the Property a
building consisting of approximately 14,400 square feet, and related landscape and
parking (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. It is contemplated that the taxable value of the land and
building upon completion will be approximately $3,200,000.
3. Timeliness of Construction. Company must substantially complete
construction of the Improvements by January 1, 2010. If Company has not obtained a
building permit and begun in good faith the construction of the Improvements upon the
Property by December 1, 2008, this Agreement may be cancelled at the sole option of
City. If construction has not begun by December 1, 2008, but the development of the
project is still imminent, the City Council may, but shall not be required to, grant an
extension of time for the construction of the Improvements. If construction has
commenced by December 1, 2008 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 substantially
completed by January 1, 2010 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 this Agreement shall be cancelled at the sole option of City.
If construction is not substantially completed by January 1, 2010, then the parties
agree to execute an amendment to this Agreement and to the Minimum Assessment
Agreement to extend the date specified in Section 4 below and the dates specified in
corresponding provisions of the Minimum Assessment Agreement.
4. 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 January 1, 2025, 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 $3,202,656.08 ("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.
5. Property Tax Rebates. Provided that Company has completed
the Improvements as set forth in paragraphs 1, 2 and 3 and has executed the Minimum
Assessment Agreement as set forth in paragraph 4, the City agrees to rebate property
taxes (with the exceptions noted below) as follows:
a. Year One - 100% rebate
b. Year Two - 100% rebate
c. Year Three - 100% rebate
d. Year Four - 100% rebate
e. Year Five - 100% rebate
f. Year Six - 100% rebate
g. Year Seven - 100% rebate
h. Year Eight - 36% rebate
for any taxable value over the January 1, 2008 value (calculated by a breakdown in
total 2008 value of $6,410 and set at $2,656.08). 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.
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. This
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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. 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.
7. 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.
8. 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.
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(b) if to Company, to Cardinal Construction Inc. ,
531 ` jMMev-C►AL facsimile$/y,' ,z -3/ / ,
attention:—cam � �
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.
9. 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.
10. 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.
11. 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.
12. Binding Effect. This Agreement shall be binding and shall inure to the
benefit of the parties and their respective successors, assigns, legal representatives,
and future owners of the Property.
13. 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.
14. Entire Agreement. This Agreement, together with the Minimum
Assessment Agreement attached hereto as Exhibit "B", constitutes the entire
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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.
15. 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 first set forth above.
CITY OF WAT LO , IOWA CARDINAL CONSTRUCTION INC.
By: otjt.
By: �rr
Trm 4ey, Mayor Pro e y:
Title:
Attest:
Nancy Ecke City Clerk
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EXHIBIT "A"
Legal Description of Property to be Improved
EXHIBIT "B"
MINIMUM ASSESSMENT AGREEMENT
This Minimum Assessment Agreement (the "Agreement") is entered into as of
this day of , 2008, by and among the CITY OF
WATERLOO, IOWA ("City"), CARDINAL CONSTRUCTION INC. ("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 San Marnan urban renewal 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 improvemerts (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 $3,202,656.08 ("Minimum Actual Value") until
termination of this Agreement. The parties hereto agree that construction of the
Improvements will be substantially completed on or before January 1, 2010. If it is not,
then the parties agree to execute an amendment to this Agreement that will extend the
dates specified in Section 2 below.
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,
2024. 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
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, 2025.
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, including but not limited to future owners of the
Project property.
CITY OF ATE LOO, IOWA
By:
Ti e fey-±-Httrley, Mayor ro Ye,►,-.
ATTEST:
By. c�
Nanc Ec e , City Clerk
CARDINAL CONSTRUCTION INC.
B : //
y: G�axi ��
Title:
STATE OF IOWA ) �
ss.
COUNTY OF BLACK HAWK )
On this I I day of , 2008, before me, a Notary Public in
and for the State of Iowa, personal! appeared Timothy J. Hurley and Nancy Eckert, to
me personally known, who being duly sworn, did say that they are the Mayor and City
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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 corporation b it and by them voluntarily executed.
i '
Nota Public
3/9001i
STATE OF IOWA )
) ss.
COUNTY OF BLACK HAWK )
Subscribed and sworn to before me on , 2008 by
as of Cardinal
Construction Inc.
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 Three Million Two Hundred Two Thousand Six Hundred Fifty Six Dollars and
Eight Cents ($3,202,656.08) in the aggregate, until termination of this Minimum
Assessment Agreement pursuant to the terms hereof.
Assessor for Black Hawk County, Iowa
Date
STATE OF IOWA )
) ss.
COUNTY OF BLACK HAWK )
Subscribed and sworn to before me on , 2008 by
, Assessor for Black Hawk County, Iowa.
Notary Public