HomeMy WebLinkAbout08-81MARCH 11, 2008
08 -81 RESOLUTION
(CARRIED 5 -2 LOST LAID OVER WITHDRAWN )
PURPOSE: APPROVE MASTER DEVELOPER AGREEMENT TERMS —
MK -1 LLC AND MK -2 LLC (BURNS DEVELOPMENT)
INITIATED BY: DEPARTMENT OF COMMUNITY DEVELOPMENT
REDEVELOPMENT AUTHORITY ACTION: Approved
BE IT RESOLVED by the Common Council of the City of Oshkosh that the
proper city officials are hereby authorized and directed to enter into a Developer
Agreement with MK -1 LLC and MK -2 LLC (Burns Development) for construction of
multi - family townhouse buildings and the renovation of an existing 4 -story building on
the former Miles Kimball property fronting on S. Main Street, Nebraska Street, W. 8th
Avenue and W. 9th Avenue, within the South Shore Redevelopment Project Area, with
substantially the same terms as attached hereto, and to carry out all actions necessary
to implement the City's obligations under the Developer Agreement.
TERM SHEET FOR BURNS SOUTH SHORE DEVELOPMENT PROJECT
BY AND AMONG
CITY OF OSHKOSH REDEVELOPMENT AUTHORITY,
CITY OF OSHKOSH, WISCONSIN AND
MK -1, LLC and MK -2, LLC
SOUTH SHORE REDEVELOPMENT AREA
February 18, 2008
I. Project
A. Development Sites/Parcels — The Project covers two development sites /parcels to
be created on the former Miles Kimball Company block bounded by South Main
Street, Nebraska Street, W. Ninth Avenue, and W. Eighth Avenue. See attached
Exhibit A identifying Phase I Development Site /Parcel and Phase II Development
Site/Parcel.
B. Development Approach/Projects-
1. MK -1, LLC and MK -2, LLC Proposal. As generally set forth in the
proposal submitted by Burns Development, dated September 7, 2007.
2. Refined Project Proposal: MK -1, LLC and MK -2, LLC proposes to
undertake a mixed use project in two phases. The Phase I Development
Project will entail construction of four 8 -unit multiple family townhouse
buildings on the Phase I Development Site/Parcel (the westerly portion of
the block). The Phase II Development Project will entail the renovation of
an existing four story building on the Phase II Development Parcel
(eastern portion of the block), with commercial uses proposed on the
ground floor and residential apartments in the upper three floors. See
attached Exhibit B which shows the Phase I and Phase II site plans.
C. Public Improvements and Activities
1. Sidewalk/Street Improvements. The City will reconstruct the sidewalks
on all street frontages, and reconstruct portions of W. Ninth Avenue and
W. Eighth Avenue adjacent to the block.
2. Undergrounding of Utilities. The City will work with Wisconsin Public
Service Corporation to determine the extent to which the undergrounding
of utilities can be implemented.
D. Schedule of Development
1. Phase I Area: MK -1, LLC will begin construction of two of the four
townhouse apartment buildings in Summer, 2008, with completion of the
first two buildings scheduled for December, 2008. Initiation of
2/18/08
construction of the two remaining townhouse buildings will occur by no
later than Fall, 2008, with completion of these buildings scheduled for
Summer, 2009.
2. Phase II Area: MK -2, LLC proposes to begin the renovation of the four
story building on the block by no later than 12 months from the date of
execution of the Development Agreement. If MK -2, LLC does not initiate
construction within the 12 month time frame, the RDA may grant an
extension to MK -2, LLC or solicit proposals for the disposition of the
Phase II Area to another developer.
E. Estimated Project Values. Based on a review of the project proposal by the City
Assessor, it is estimated that the value of the Phase I Area will be approximately
$1,760,000, while the estimated value of the Phase II Area will be approximately
$850,000.
II. City/RDA Undertakings Prior to Closing of Development Sites/Parcels (Apply
Separately to each Development Site/Parcel)
A. Review and, if acceptable, approve all private development plans, related zoning
and approvals necessary for undertaking the Phase I and Phase II projects.
Rezoning by City of block from M -2 Central Industrial to C -3 Central
Commercial with a Planned Development Overlay District.
2. RDA review and approval of Development Plan by Development Site/
Parcel.
3. Plan Commission and Common Council to provide Zoning Ordinance
approval by review and action on Conditional Use Permit/Development
Review request for Phase I and Phase II areas.
B. Approve all documents of conveyance by deed of Development Site/Parcel to
Developer.
C. Pay /Go Commitment by City for Phase I Project in the form of a taxable tax
increment revenue bond (the "TIF Bond ") in the amount of not to exceed
$375,316 to reimburse the owner of the Phase I Development Site/Parcel for
construction of the townhouse buildings on the Phase I Development Site/Parcel.
The TIF Bond will be issued and delivered to MK -1, LLC only upon
completion of the construction and site improvement work and submission
of documentation satisfactory to the City reflecting actual costs expended
on such work. MK -1, LLC understands that all of the costs associated
with that work must be paid for by MK -1, LLC up front and that MK -1,
LLC, if it owns the Phase I Development Site/Parcel, will be reimbursed
for those costs only if the development on the Phase I Development Site/
Parcel creates Available Tax Increment and such Available Tax Increment
2 2/18/08
is appropriated by the City Council to payment of the Bond. Interest and
principal will be paid each year by the City to MK -1, LLC, if it owns the
Phase I Development Site/Parcel, on the TIF Bond from Available Tax
Increment from the Phase I Development Site/Parcel pursuant to the
schedule set forth on Exhibit C attached hereto, but only to the extent such
Available Tax Increment exists and only if appropriated by the City
Council. If there is no Available Tax Increment from the Phase I
Development Site/Parcel, then the City is not required to pay MK -1, LLC
on the TIF Bond.
2. Payment on the TIF Bond shall be subject to the following conditions:
a. the existence of Available Tax Increment from the Phase I
Development Site/Parcel.
b. future annual appropriation of the payment by the City Council,
and
C. MK -1, LLC, if it is the owner of the Phase I Development Site/
Parcel, not being in default under the Development Agreement
governing the development by MK -1, LLC, if it is the owner of the
Phase I Development Site/Parcel.
3. "Available Tax Increment" means an amount equal to the annual gross tax
increment revenues actually received and retained by the City which is
generated in the immediately preceding calendar year by improvements
made after January 1, 2008 to the Phase I Development Site/Parcel.
4. "Annual Gross Tax Increment Revenues" equals the full equalized value
(real estate and personal property) of the Phase I Development Site/Parcel
minus the full equalized base value of the Phase I Development Site/
Parcel ($408,800 is the agreed upon amount of the full equalized base
value of the Phase I Development Site/Parcel) multiplied by the equalized
tax rate for that calendar year. This formula reflects the current
methodology for calculation of tax increment revenues, and the parties
recognize and agree that future statutory changes or changes in
Department of Revenue practice for calculation of tax increment revenues
may result in changes to the formula.
5. A more detailed description of the provisions of the TIF Bond is attached
hereto as Exhibit D.
III. Developer Undertakings Prior to Closing on Development Sites/Parcels (Apply
separately to each Development Site/Parcel)
A. Prepare Development Plan and submit for City/RDA review and approval,
including all required zoning.
2/18/08
B. Prepare Development budget and schedule for construction for RDA approval.
Development budget to show that Estimated Project Values will be achieved for
Development Sites/Parcels.
C. Prepare and provide evidence of plans and specifications for Development Site/
Parcel.
D. Prepare and provide evidence of construction related contract(s) for Development
Site/Parcel.
E. Secure and provide evidence of construction and permanent financing and equity
necessary to complete project on approved Development Site/Parcel.
F. Secure all permits and approvals necessary for Development Site/Parcel.
G. All of the above in form and substance satisfactory to City.
IV. Closing Activities
A. At Closing Developer will:
1. Close financing for Development Site/Parcel.
2. Execute construction contract for Development Site/Parcel or provide
assurance to the satisfaction of City/RDA of the existence of a binding
contract for the construction of the Development.
3. Deliver appropriate representations and warranties.
B. At Closing RDA will:
1. Convey by deed the Development Site/Parcel.
2. Conveyance will be by payment of $1.
V. Environmental. Phase I and Phase II Environmental Assessments have been undertaken
for the block and no environmental issues were identified. Copies of these reports will be
provided to the developer.
VI. Phase II Area Development Assistance
A. City/RDA may consider issuance of a separate taxable tax increment revenue
bond ( "TIF Bond ") in support of the renovation project proposed in the Phase II
Area, based on a determination of need and an appropriate financial gap analysis.
B. City/RDA will also seek funding support through the State Division of Housing
for funds to assist with renovation of the upper floor space for residential
apartments in the four story building on the Phase II Development Site/Parcel.
4 2/18/08
VII. Limitation on Conveyance
A.
No tax exempt entities.
B.
Prior consent of City/RDA.
VIII. Miscellaneous Provisions
A.
Compliance with laws.
B.
Payment of all taxes and fees.
C.
Limitation on use.
D.
Insurance.
E.
Indemnification.
F.
Defaults.
G.
Remedies.
H.
Force majeur.
1.
Nondiscrimination.
J.
No personal liability of City officials.
K.
Right of inspection.
L.
Representations and warranties.
M.
Termination — survival of certain provisions.
N.
S everability.
O.
Additional miscellaneous provisions.
5 2 /18 /08
O
r
w
uj
90L UL w w
0 nAAIKI .qT
LOL I L U I .I
r
Few
o
0
Q Q Q
rn 0 a)
Imo- Q
r ti
r
u N
t
C
a
co
y
co
Q
d'
906
LU
Z -
1~ )
3
0
v
0
cn
U
L
^^
v,
a)
E
W
_0
Z
X >
wo
06
cn
co
U
0
� Q
C
co
> Z
V
L o
0
C
0 O 2
`
ca L L
0
0
0
Few
o
0
Q Q Q
rn 0 a)
Imo- Q
r ti
r
u N
t
C
a
co
y
co
Q
d'
906
LU
Z -
1~ )
3
0
v
0
cn
U
L
^^
v,
a)
E
W
_0
Z
X >
wo
06
cn
co
U
0
� Q
C
co
> Z
V
L o
0
C
0 O 2
`
ca L L
90L
LOL
N C° 00
I
W
W
LPL
Nt
r
�
W
� Fitly.
FF� :ill
�Li�
d
•� O
� 3
1
N
11•
rn
Q
rn rn rn
T
r
R-MMR
Ta
� C
.O
E
O
�/
U
N
F-
C C
U. LL
W
�d
c a
SMAINST0co
� Fitly.
FF� :ill
�Li�
d
•� O
� 3
1
N
11•
rn
Q
rn rn rn
T
r
R-MMR
. _
•
m
•E O
� 3
9
1S` NS "93N
LO a O
O V
T
LO
M
o
co ,
W
ZN co U-
Y �
0
o
P.
rot
m +
od
m
x
W N
N
cn
co
CL
U
a
Q �
� Q
®
Q) 0
W ca
> ^4,
y
co
®� .°
506 0 �
a�
® z O N
0) ca d
LL
u
H
C
a
a
a
v
a
0
O
O
L
.1 .
0
a
a,
C
O
00
O
a
E
O
C
1
0
0
R
w
U
EXHIBIT C
co co cn
CD o
•;.ec N N w 0 N N O N N N M
00 O N tD \ \ L11
Lo
� N i/F V1
tJ_
is
1J3.
k
sax.
C
�r
]C Of
O
40 aJ
n'. U m rra
"y. m u V
:C
Y m acr
IO c E M ' =' `!
M CL
c
CL
<:
a O to OL ` O a d s O 4
m 'p 7 N f- ` m ra O
O t+ 7 J
O/ N a.+ d N h +' c t0
m o ma Lj
m u m E a Y v rcO e0
LL LL LL D O cr �+ O L
�. H F- P U D. 7 w C J L.L O
V CY M l0 N N n M w t! 111 p o m g m 0 .-1 N r N .4 M V
M N ri N N N N M N n O N w O V Ol T M Ln N Ol w C'
w N w O 4 w N tD O [h 0i M r% N tD O 0 01 V at M w Cr
4 N N m M M v g 0 N l0 a t0 r r\ a OJ 01
ri
r1 N M m M M M M C n M M M M M M M M M M m M M M M
.4y 4D
3m
;n
M O M 01 w O1 m O Ln rt Ln im O M v 00 m M N ri .-L rl O
u1
0 00 N .-1 n M n M lD n w n W w w M rr M O M
.
r V N Ol w n tD tD n Ol v w M Ol b o M v tD 01 d' O
v Le Lc to L: a 0i o 4 N a vi a e Di r♦ M Lri Di
rO`.
.;OgM
ri N N rl rl N H ri N N N N N M M M
. •,�'c-t+
�} N M rL M n n N 00 O si tD O M w O N w N N ri O w C
M V w R m M w N w M n e N ri w tD e-L
N a n 00 00 00 t0 C O 10 O M 14 d' m
a O N
gi p;,
C`s,3L"
O V1 cI C M M N ri r1 O Q1 00 N lG M M" w 10 [f
ri N N N N N N N N N N rl ri rl rl .-1 ri rL rl r/
'C M 00 O N 00 N to ri O '7 �t
N m 'I M n n N w O ID O
N 01 0 Ln .ti N w 01 V w C M Ln N N w M n " N rf 'D lD ri
•
. 0
N .4 iL n v, o Ln o Ln o1 N Ln r OD woo �D a o ID o m a v m
14
r1 N" fy � N O� w tO �Y N
N N N N N N N N N N N N H N N W Ln
='a a
4 'p3
c1
W O w w M d' w Ol tD tD N 9 w n n a O N O Ln M N N O
rL M g r s w 0 m t0 n O n O N n M Ln Ol O n tD M m
InmmLnoo. -Lan n1D.�NwolNnaolm ao
c <mowo
D m O N M rt n
O t0 O a n M O ri O 00 0 ri tD M O O 1
w w frl O r M
n w O M M 00 n to w Ln V' N H O w w Ln M O
M m V' m M m m M M m M M m M N N N N N 14 H ei rl
-- "•`
a v m . lD N N n t uo1 w et Ln O Ol m rl M O ri n n N . 0 v
O M N r! ri .-1 .-1 N .m an n O N t0 O V Ol .S 01 N N 01 w Kr
vwry w0 - tDO 't -1 LDOLnrnvOlmwM
M*1mmL it mm
-lNrrnMM nmmmmmmm
k-
; e
t!
0 tD W W 0 10 tD lD N W lD LD W tD tD tD w 0 0 lD tD tD tD tD tD
N N N N N N N N N N N N N N N N N N N N N N N N
L 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
O1 O1 Ol O1 O1 t01 O1 O1 O1 01 O1 6 e 01 01 01 M M 6 M 01 01 Ol 01
y:
_...<
O N O1 N w 01 M N d' N H tD tD 01 n Ol to n M
n M w v Q M m R Ln lD w O N N CO N tD N tD N w ri Ol r
'
;r w N tD O CF w N w O Ln 01 M F N tD rt to O d' D1 ; w M
° v M y
r m m m °v v a v a v v a v v v v v
9
w w w w w w w w w w w w w w w w w w w w w w w w w
�
�` N rV N N N N N fV N IV N N N N N N N N N N N N N N N
?j3u W'
r�:
F
2 08 w0Mw www 0 0 N 't in wtD -J-
O n M 0 n n 111 N w M n 4 A n O m n N n m O
N
N N w Ln N tD O1 ri O O M n N N t11 Ol L11 V' V n N Ol
':", ._• ���" N N 00 lO a N O Ol 00 n l0 V1 g C g d' et 111 tO 1� 00 O 10,
O n M LI1 n Dl - M tD w
y :0y
$
� ��
r to t0 w O N v in n O1 r M v1 n rl
v MmMavvcvaLnlnlnwvltDlDt0w tonnnr
ri ri ri ra ri ti ri r� ri ri ti ri ri ri ri ri ri .� ri ti ri ri ri
;g c
w O M 00 N w w tD Ln tD N tt N M w tD O N tt O O
O O O n M lD n n vl N w M n r1 t7 r O
:d
O O tD M M CI' n N Ol w w r♦ V1 N O O- n m N N N O r
O O^ M M M M M M M LA e h 01 O
Ln e-1 01 00 t0 Vl K
w O N d' ID w O N a tD w O N C tD Ol
;C;•
warn nwwww walmrnMMci o oor+. -Lr� rirl
OR
N N e ri ri r-4 rl '-I ri ra ri rl N N Cr N N N N N N N N
w F O N N m C Ln tD r' 00 O1 O r'1 N M C' ut w n w 01 O ri N
ri N N N N N N N N N N N m M M
} S o 0 0 0 0 0 0 0 0 0 0 0 o O o 0 0 0 0 0 o O o 0
N
X
N N N N N N N N N N N N N N N N N N N N N N N N
1 w 01 O .-t N M w n w M O 1-1 N M V' Ln t0 n w O1 O .-L
°• "� O O rl r1 ri ri ri ri ei rl H r/ N N N N N N N N N N M M
m o 0 0 0 0 0 0 0 0 o O O O o 0 0 O o 00 0 0 0
-`�' N N N N N N N N N N N N N N N N N N N N N N N N N
N
+`
44 `
ti J
co co cn
CD o
•;.ec N N w 0 N N O N N N M
00 O N tD \ \ L11
Lo
� N i/F V1
tJ_
is
1J3.
k
sax.
C
�r
]C Of
O
40 aJ
n'. U m rra
"y. m u V
:C
Y m acr
IO c E M ' =' `!
M CL
c
CL
<:
a O to OL ` O a d s O 4
m 'p 7 N f- ` m ra O
O t+ 7 J
O/ N a.+ d N h +' c t0
m o ma Lj
m u m E a Y v rcO e0
LL LL LL D O cr �+ O L
�. H F- P U D. 7 w C J L.L O
EXHIBIT D
Terms of TIF Bond
The TIF Bond shall bear interest at the rate of 6.25% per annum, which interest shall
begin to accrue on the date of issuance of the TIF Bond. The TIF Bond shall mature and the
City's obligation to repay all or any portion of the TIF Bond shall terminate on November 1,
2032. Principal and interest on the TIF Bond will be due and payable on November 1 of each
year during the term of the TIF Bond, commencing in the calendar year in which interest begins
to accrue on the TIF Bond. The amount of the annual payment of principal and interest due on
November 1 of each year shall be equal to the amount shown on the schedule attached hereto as
Exhibit C. Each payment of principal and interest shall be applied first to interest, then to
principal.
The TIF Bond shall be subject to the following provisions:
(a) The TIF Bond shall be a special and limited revenue obligation of the City
payable solely from Available Tax Increment generated from the MK -1, LLC Phase I
Development Site/Parcel which is appropriated by the City Council, and shall not be a general
obligation of the City or a charge against its general credit or taxing powers. Only funds
appropriated by the City Council from the special fund of Tax Incremental District No. 20 of the
City (the "TIF District ") shall be used to pay principal and interest on the TIF Bond. The City
Council shall, in a resolution, state that it fully expects and intends that, to the extent Available
Tax Increment generated from the MK -1, LLC Phase I Development Site/Parcel is available in
the special fund of the TIF District, it will appropriate such funds for the payment of the
principal of and interest on the TIF Bond; however, such payment shall be subject to future
annual appropriations.
(b) City staff shall include in each annual City budget submitted to the City
Council for consideration, the payment from the TIF District special fund of the principal and
interest on the TIF Bond, but only to the extent of Available Tax Increment generated from the
MK -1, LLC Phase I Development Site/Parcel. If the budget is approved by the City Council, the
City Council shall, at the time of and as part of the approval of the annual City budget, direct to
payment of the TIF Bond, such Available Tax Increment generated from the MK -1, LLC Phase I
Development Site/Parcel. All payments on the TIF Bond shall be applied first to interest, then to
principal.
(c) If the aggregate amount of Available Tax Increment generated from the
MK -1, LLC Phase I Development Site/Parcel that is available and appropriated to make
payments on the TIF Bond during any budget year is less than the aggregate principal and
interest payments payable on the TIF Bond during that budget year, the amount due but not paid
shall accumulate, and the City shall pay accumulated amounts from Available Tax Increment
generated from the MK -1, LLC Phase I Development Site/Parcel if, as and when it is available
and appropriated for that purpose during the term of the TIF Bond. If the amount available for
transfer from the TIF District special fund for any budget year exceeds the amount of the
2/18/08
principal and interest due and payable on the TIF Bond on the TIF Bond payment dates
occurring during said budget year, then the City shall be entitled to use such excess funds for any
other statutorily eligible TIF District project cost.
(d) On November 1, 2032, if there remain amounts outstanding and unpaid on
the TIF Bond, then all interest accrued but unpaid and the remaining balance of principal of the
TIF Bond shall be deemed paid in full, it being understood that upon November 1, 2032, the
liability of the City to make any payments on the TIF Bond shall also terminate. The City shall
have no obligation to pay any amount of principal or interest on the TIF Bond which remains
unpaid as of November 1, 2032, and the owner(s) of the TIF Bond shall have no right to receive
payment of such amounts. All increments received by the City generated from the MK -1, LLC
Phase I Development Site/Parcel from the TIF District following November 1, 2032 may be used
by the City in any manner the City, in its sole discretion, chooses.
If for any reason (other than by voluntary resolution of the City), the TIF District
terminates prior to November 1, 2032, and there remain amounts outstanding and unpaid on the
TIF Bond, then all interest accrued but unpaid and the remaining balance of principal of the TIF
Bond, shall be deemed paid in full, it being understood that upon such early termination of the
TIF District, the liability of the City to make any payments on the TIF Bond shall also terminate.
The City shall have no obligation to pay any amount of principal or interest on the TIF Bond
which remains unpaid upon such early termination of the TIF District and the owner(s) of the
TIF Bond shall have no right to receive payment of such amounts.
(e) The actual principal amount of the TIF Bond will be determined following
completion of construction of the redevelopment project based on the actual costs of the
redevelopment project. If the actual costs of the redevelopment project are less than the cost of
the redevelopment project as shown on the project cost breakdown specified in the Development
Agreement, then the amount of the TIF Bond shall be reduced by the difference between the
amount shown on the project cost breakdown and the actual costs of the redevelopment project.
The actual costs of the redevelopment project shall be reviewed and certified by the City's
financial advisors.
(f) The City shall have no obligation to make any payments on the TIF Bond
while MK -1, LLC, if it is owner of the Phase I Development Site/Parcel, is in default under the
Development Agreement.
2/18/08