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HomeMy WebLinkAboutWalgreen Co.-Development Agreement-01.20.2009 6(1 /2eo - 36 DEVELOPMENT AGREEMENT This Development Agreement (the "Agreement") is entered into as of„a , 2009, by and between Walgreen Co., an Illinois corporation, its affiliates and wholly-controlled related entities ("Company"), and the City of Waterloo, Iowa ("City"). RECITALS A. WHEREAS, 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; and B. WHEREAS, Iowa Code Chapter 403_provides the authority and establishes procedures by which the City may undertake development projects within blighted areas of the city and finance such projects through the use of tax incremental financing; and C. WHEREAS, on February 18, 2008 the City Council adopted a resolution creating Tax Increment Financing District Amendment No. 1 (the "Logan Urban Renewal Area"), in the city of Waterloo; and D. WHEREAS, Iowa Code Chapter 403_authorizes the City to incur project costs in the discretion of its City Council, which are found to be necessary or convenient to the creation of tax incremental districts or the implementation of project plans; and E. WHEREAS, Company is willing and able to finance and construct a building and related improvements on property located in the Logan Urban Renewal Area; and F. WHEREAS, on , the city council approved a project plan for the site of construction of a building and related landscaping and parking within such Logan Urban Renewal Area, more fully described in the Agreement below, which site the City believes will promote the revitalization and economic stability of the City. AGREEMENT NOW, THEREFORE, in consideration of the mutual covenants set forth herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: 1. Purchase of Property. Company has purchased the real property described on Exhibit "A" attached hereto (the "Property") and has obtained marketable title thereto. 2. Improvements by Company. Company has constructed on the Property a building consisting of approximately 14,736 square feet, and related landscaping and parking (the "Improvements"). Company represents that the Improvements have been constructed in accordance with all applicable City, state, and federal building codes and have complied with all applicable City ordinances. Company completed the Improve- ments by December 31 , 2008, adding taxable value of approximately $1 ,419,610. The taxable value of the land and building upon completion of the Improvements will be approximately $1 .5 million. 3. 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, 2021 , 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 $1,500,000 ("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". 4. Property Tax Rebates. Provided that Company has executed the Assessment Agreement as set forth in Section 3, the City agrees to rebate property taxes (with the exceptions noted below) as follows: a. Year One - 100% rebate b. Year Two - 100% rebate 2 c. Year Three - 100% rebate d. Year Four - 100% rebate e. Year Five - 100% rebate f. Year Six - 100% rebate for any taxable value over the January 1, 2008 land value of $80,390. 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. 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") is 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. Rebates will be paid to Company by City within 60 days after all general property taxes due and owing for such year are remitted to City. 5. 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. 6. 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 3 to be delivered to City hereunder is and shall be authorized to do so on behalf of Company. 7. 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 Walgreen Co., 104 Wilmot Road, MS 1435, Deerfield, Illinois, 60015, Attention: Audrey Johnson, with copies to Margarita Kellen. 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. 8. Default. In the event that this Agreement is terminated by the City for default by Company, this Agreement shall be reinstated in the event and at the time that Company corrects any defaults that caused the termination and will continue thereafter for the remainder of the twelve (12) year tax roll period. 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 4 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 Assessment Agreement attached hereto as Exhibit "B", 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. 15. Conditional Approval. Company's approval of this Agreement shall be conditional upon approval of this Agreement by the Waterloo Iowa City Council. 16. Time of Essence. Time is of the essence of this Agreement. 5 IN WITNESS WHEREOF, the parties have executed this Development Agreement as of the date first set forth above. CITY OF WATERLOO, IOWA WALGREEN CO. By. By: Timothy J1..„.„,4 , Mayor Margarita e en NI2-12e4 Assistant Sec ry 104 Wilmot Road, MS 1435, Deerfield IL 60015 Attest� a Phone: (847)315-4226 Nancy Eckert, ity Clerk 6 • EXHIBIT "A" Legal Description of Property Improved NORTH WATERLOO PLACE LOTS 1,2,3,4,5,20,21,22,23 & 24 ALL IN BLOCK 1, CITY OF WATERLOO, BLACK HAWK COUNTY, STATE OF IOWA. EXHIBIT "B" ASSESSMENT AGREEMENT This Assessment Agreement (the "Agreement") is entered into as of this day of , 2009, by and among the CITY OF WATERLOO, IOWA ("City"), WALGREEN CO., an Illinois corporation, its affiliates and wholly-controlled related entities ("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, pursuant to the Development Agreement, the Developer has undertaken the development of an area ("Project") within the City and within the Logan Urban Renewal Area; and WHEREAS, pursuant to Iowa Code § 403.6, as amended, the City and the Developer desire to establish an actual value for the land and the building(s) pursuant to this Agreement and applicable only to the Project, to be effective as of January 1, 2008 and from then until this Agreement is terminated pursuant to the terms herein and which is intended to reflect the actual value of the land and buildings as to the Project only; and WHEREAS, the City and the Assessor have reviewed the completed improvements (the "Improvements") that were erected as a part of the Project before December 31 , 2007. NOW, THEREFORE, the parties hereto, in consideration of the promises, covenants, and agreements made by each other, do hereby agree as follows: 1 . Effective as of January 1, 2008, the actual taxable value which shall be fixed for assessment purposes for the land and Improvements constructed thereon by the Developer as a part of the Project shall not be less than $1 ,500,000.00 ("Actual Value") until termination of this Agreement. 2. The Actual Value herein established shall be of no further force and effect, and this Assessment Agreement shall terminate, on December 31, 2020. 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 Actual Value established herein. In no event, however, shall the Developer seek or cause the reduction of the actual value assigned below the 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, 2021. 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. 6. Approval by Company of this Agreement shall be conditional upon approval of the Agreement by the Waterloo City Council. CITY OF WATERLOO, IOWA By: ATTEST: Timothy J. I y, Mayor By: c. Nancy Eck ity Clerk WALGREEN CO. Margari ellen Assistant ecretary 2 STATE OF IOWA ) ) ss. COUNTY OF BLACK HAWK ) � On this day of , 2009, before me, a Notary Public in and for the State of Iowa, person Ily app ed 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 corporation by it and by them voluntarily executed. otary ublic I STATE OF IOWA ) ) ss. COUNTY OF BLACK HAWK ) Subscribed and sworn to before me on , 2009 by as for Walgreen Co. Notary Public 3 CERTIFICATION OF ASSESSOR The undersigned, having reviewed the completed improvements constructed and the market value assigned to the land upon which the improvements were constructed for the development, and being of the opinion that the market value contained in the foregoing 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 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 Five Hundred Thousand Dollars ($1,500,000.00) in the aggregate, until termination of this 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 , 2009 by , Assessor for Black Hawk County, Iowa. Notary Public s ill