HomeMy WebLinkAbout#22 - Four Corners 1st Addn DA AmendmentSTAFF REPORT
DATE: October 6, 2020
REGULAR
TO: Mayor and City Council
FROM: Kristina Handt, City Administrator
AGENDA ITEM: Four Corners 1st Addition Development Agreement Amendment 1
BACKGROUND:
At the August 18, 2020 city council meeting, council directed the city attorney (Jared Shepard) to draft
notice of default to Developer with opportunity to cure through all of following actions: 1) commencing
project within the same week that utility relocation work is complete; 2) Execution of Amendment to DA
by no later than October 5, 2020; 3) Provision of New LOC in amount of $1,766,526.00 by no later than
October 5, 2020. If the Developer does not cure the default through all of the above actions, City staff
may enforce the agreement by drawing on the Letter of Credit, and utilizing any all other default remedies
provided under the Agreement, and the City may perform the work. That letter was sent to the developer
on August 20, 2020.
Since that time the developer has signed an amendment to the development agreement, is working on
getting the LOC updated (most recent update will be provided at council meeting) and commenced the
project on October 1, 2020.
ISSUE BEFORE COUNCIL:
Should the city council approve the amendment to the Four Corners 1st Addition Development
Agreement?
PROPOSAL DETAILS/ANALYSIS:
Included in your packet is a copy of the amendment to the development agreement (DA) for Four Corners
1st Addition. The amendment amends Section 11 of the DA to change the time of performance for
completing the public improvements to July 31, 2021. A number of project milestones are also added to
help ensure things continue to progress. The first three milestones have been attained. The developer may
request an extension of time on any of the items but the city is not required to grant an extension.
The amendment also amends section 28 of the DA by adding paragraph 3 as shown on the underline. If
the developer fails to perform as required and if 45 days after notice of default from the city the default is
not corrected, the city may terminate the agreement.
The amendment also provides for a new letter of credit (LOC). Since the project costs were first
estimated over 2 years ago, construction costs have gone up. Amendments to section 32 update how the
new LOC amount is distributed by categories.
FISCAL IMPACT:
The total LOCs would be increased to $1,766,526 to cover the increased costs of the project due to the
delay in starting.
OPTIONS:
1) Approve the First Amendment to the Development Agreement for Four Corners 1st Addition
dated October 22, 2018.
2) Amend and then Approve the First Amendment to the Development Agreement for Four
Corners 1st Addition dated October 22, 2018.
3) Do not approve an amendment to the Four Corners 1st Addition Development Agreement.
RECOMMENDATION:
Motion to Approve the First Amendment to the Development Agreement for Four Corners 1st
Addition dated October 22, 2018.
ATTACHMENTS:
• Four Corners 1st Add DA Amendment
• Copy of LOC