HomeMy WebLinkAbout#09 - Water Tower Option AgreementSTAFF REPORT
DATE: July 20, 2021
CONSENT
AGENDA ITEM: Water Tower Option Agreement
SUBMITTED BY: Kristina Handt, City Administrator
BACKGROUND: A water tower is needed in the area south of 10th Street and as close to Lake Elmo Ave as possible
in order to provide adequate water service for growth in the eastern area of Lake Elmo. Staff has been reaching out to multiple property owners in the area for a couple years trying to secure a location to build the water tower. A right of entry was granted in April while the seller’s attorney reviewed the agreement. Soil borings are underway and should be available by the end of July.
ISSUE BEFORE COUNCIL: Does Council approve the water tower option agreement with the Peltiers? PROPOSAL: Included in your packet is an option agreement drafted by the city attorney and signed by the
Peltier trust representative. This agreement gives the city the option to purchase .82 acres for a water tower facility and obtain the necessary easements. The stormwater easement may be abandoned in the future if the seller develops the rest of the parcel and meets the watershed requirements.
The option price is $1,000. If the city moves forward with the purchase this applies to the purchase price. If the city does not, the seller keeps the $1,000. The option period expires on March 1, 2022.
In addition to the $50,000 purchase price the city at its expense, will extend trunk watermain pipe along Lake Elmo Avenue to the location on the Option Property where the city will be constructing a water tower. As part of this project, lateral watermain stubs for connection for future development will be placed by the city, at the expense of the city to serve the property both north and south of Hudson Boulevard and west of Lake Elmo Avenue.
Section 9.3 details the allocation of various closing costs amongst the city and the seller which are typical. Real estate taxes will be prorated at closing. Sellers pay broker fees. FISCAL IMPACT: $50,000 purchase price plus cost of extending water mains (estimated at $385,000). Closing costs
as discussed above. All funds would come from the water fund.
OPTIONS: 1) Approve the Option Agreement for Water Tower Site
2) Amend and then Approve the Option Agreement for the Water Tower Site 3) Do not approve the Option Agreement for the Water Tower Site RECOMMENDATION: If removed from the consent agenda:
“Motion to approve the Option Agreement for the Water Tower Site with Peltiers.”
ATTACHMENTS:
• Option Agreement