HomeMy WebLinkAbout#09 - Royal Golf 3rd Addition Development Agreement AmendmentLA515-57-755589.v1
DATE: October 19, 2021
CONSENT
TO: Mayor and City Council
FROM: Molly Just, Planning Director
AGENDA ITEM: The Royal Golf Club at Lake Elmo 3rd Addition - Development Agreement Amendment
REVIEWED BY: Sarah Sonsalla, City Attorney
INTRODUCTION: Lennar, the developer of The Royal Golf Club at Lake Elmo 3rd Addition is proposing an Amendment to the Development Agreement for The Royal Golf Club at Lake Elmo 3rd Addition.
BACKGROUND: On June 6, 2017, the Lake Elmo City Council adopted Resolution 2017-47 approving the Preliminary Plat and PUD Plans for The Royal Golf Club at Lake Elmo. On December 4, 2018, the City Council approved the Final Plat and Final PUD plans for The Royal Golf Club at Lake Elmo 3rd Addition.
On July 6, 2021, the Lake Elmo City Council adopted Resolution No. 2021-076 approving the Development Agreement for The Royal Golf Club at Lake Elmo 3rd Addition. ISSUE BEFORE THE CITY COUNCIL:
The City Council is being asked to adopt Resolution 2021 – 110 A Resolution Approving the First Amendment to the Development Agreement for The Royal Golf Club at Lake Elmo 3rd Addition.
REVIEW/ANALYSIS: Since the Development Agreement was approved and executed by the City and Lennar on July 6, 2021,
the cost estimates for the amount of security required have changed. Due to these changes, Exhibit C of
the Development Agreement needed to replaced with a new exhibit which is attached to the First
Amendment. In addition, the Development Agreement needed to be amended concerning the reduction of
security to reflect the new security amounts. The new cost estimates and security reduction provisions
have been reviewed and approved by the City Engineer.
Also, the plans have been revised and therefore, Exhibit B of the Development Agreement needed to be
replaced with a new exhibit. The revised plans have been reviewed and approved by the City Engineer.
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Finally, it was determined by the City and the Developer that a stormwater maintenance and easement
agreement was not required due to there not being any stormwater facilities in this particular addition.
The amendment to the Development Agreement removes references to the stormwater maintenance and
easement agreement from the Development Agreement.
OPTIONS: The City Council has the following options:
1) Adopt Resolution 2021-110 Approving the First Amendment to the Development Agreement for The Royal Golf Club at Lake Elmo 3rd Addition; or
2) Direct Staff to revise the First Amendment to bring back to a future City Council meeting. RECOMMENDATION:
Staff recommends the City Council adopt Resolution 2021-110 Approving the First Amendment to the
Development Agreement for The Royal Golf Club at Lake Elmo 3rd Addition.
“Move to adopt Resolution 2021-110 Approving the First Amendment to the Development Agreement
for The Royal Golf Club at Lake Elmo 3rd Addition.”
ATTACHMENTS:
• First Amendment to the Development Agreement
• Resolution 2021 - 110
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FIRST AMENDMENT TO DEVELOPMENT AGREEMENT This First Amendment to Development Agreement (“First Amendment”) is made and entered into this _____ day of September, 2021, by and between the City of Lake Elmo, a municipal corporation under the laws of Minnesota (the “City”) and U.S. Home Corporation, a Delaware corporation d/b/a Lennar (the “Developer”).
RECITALS: A. The City and the Developer have entered into a Development Agreement dated _______________, 2021 and recorded with Washington County on _____________, 2021 as
Document No. _________ (the “Development Agreement”); and
B. The Development Agreement relates to that subdivision located in Lake Elmo, Minnesota known as Royal Golf Club at Lake Elmo 3rd Addition and the property is legally described on Exhibit A attached hereto; and
NOW, THEREFORE, in consideration of the above recitals, which are expressly incorporated herein, and for other good and valuable consideration, the receipt and sufficiency which is hereby acknowledged, the City and the Developer agree to amend the Development Agreement as follows:
1. Paragraph 3(B) of the Development Agreement is hereby removed in its entirety and the subsequent paragraphs of Paragraph are hereby renumbered accordingly. 2. Paragraph 34 of the Development Agreement is replaced in its entirety with the
following new Paragraph 34.
34. SUMMARY OF SECURITY REQUIREMENTS. To guarantee
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compliance with the terms of this Agreement, payment of special assessments,
payment of the costs of all public Subdivision Improvements, and construction of
all public Subdivision Improvements, the Developer shall furnish the City with an
irrevocable letter of credit or a cash escrow or a combination of a cash escrow and
letter of credit (the “Security") in the amount of $5,044,448. The bank originating
the letter of credit shall be determined by the City to be solvent and creditworthy.
The letter of credit shall substantially be in the form attached to this Agreement
and must be approved by the City. The amount of the Security was calculated as
itemized on Exhibit C. If at any time the City reasonably determines that the bank
issuing the letter of credit no longer satisfies the City’s requirements regarding
solvency and creditworthiness, the City shall notify the Developer and the
Developer shall provide to the City within forty-five (45) days a substitute for the
letter of credit from another bank meeting the City’s requirements. If the Developer
fails to provide the City within forty-five (45) days with a substitute letter of credit
from an issuing bank satisfactory to the City, the City may draw under the existing
letter of credit.
This breakdown is for historical reference; it is not a restriction on the use
of the Security. The City may draw down the Security, without notice, for any
violation of the terms of this Agreement or if the Security is allowed to lapse prior
to the end of the required term. If the required public Subdivision Improvements
are not completed at least thirty (30) days prior to the expiration of the Security,
the City may also draw it down. If the Security is drawn down, the proceeds shall
be used by the City to cure the default.
3. Paragraph 35 of the Development Agreement is replaced in its entirety with the following new Paragraph 35.
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35. REDUCTION OF SECURITY. Upon written request by the Developer and upon
receipt of proof satisfactory to the City Engineer that work has been completed in
accordance with the approved Plans and the terms of this Agreement and that all financial
obligations to the City have been satisfied, the City Engineer may approve reductions in
the Security in the following instances:
A. Up to 75 percent of the Security associated with the itemization on Exhibit C may
be released upon completion of the following key milestones of the project as
determined by the City Engineer:
1. Construction Categories 2 and 3: The amount of $1,002,248 may be released
when all sanitary sewer and watermain utilities have been installed, all testing
and televising has been successfully completed, sanitary sewer as-built inverts
have been verified, and the utilities are considered ready for use by the City
Engineer.
2. Construction Categories 4 and 5: The amount of $1,454,585 may be released
when all streets, sidewalks, and storm sewer have been installed and tested,
and have been found to be complete to the satisfaction of the City Engineer
including all corrective work for any identified punch list items and including
verification of storm sewer as-built inverts, but not including the final wear
course.
3. Construction Categories 6-10 and 14-17: The amount of $222,364 may be
released when all remaining Developer’s obligations under this Agreement
have been completed including: (1) bituminous wear course; (2) street lighting
and private utilities; (3) trails; (4) bio retention facilities; (5) iron monuments for
lot corners have been installed; (6) all financial obligations to the City satisfied;
(7) the required "record" plans in the form of the City standards have been
received and approved by the City; and (8) the public Subdivision
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Improvements are accepted by the City Engineer and the City Council.
4. Construction Categories 11, 12 and 13: The amount of $237,459 may be
released when landscaping Subdivision Improvements have been installed to
the satisfaction of the City including all corrective work for any identified punch
list items.
B. Twenty-five percent of the original Security amount, excluding grading and
landscaping improvements shall be retained until: (1) all Subdivision
Improvements have been fully completed and accepted by the City, including all
corrective work and warranty punch list items; (2) all financial obligations to the
City have been satisfied; and (3) the warranty period has expired.
C. Twenty-five percent of the original Security amount associated with landscaping
shall be retained by the City until: (1) all landscaping Subdivision Improvements
have been fully completed and accepted by the City, including all corrective work
and warranty punch list items being completed by the Developer; (2) all financial
obligations to the City have been satisfied; and (3) the warranty period has expired.
D. In addition to the above project milestone based Security reductions, the
Developer may submit a written request and upon receipt of proof satisfactory to
the City Engineer that work is progressing in accordance with the approved Plans
and the terms of this Agreement and that all financial obligations to the City have
been satisfied, the City Engineer may approve a one-time reduction in the Security
for Construction Categories 2-5 in an amount not to exceed 50 percent of the initial
Security amount. This one-time Security reduction does not apply to Categories 4-
5 if boulevard sidewalks or trails have not been installed.
E. It is the intent of the parties that the City at all times have available to it Security in
an amount adequate to ensure completion of all elements of the Subdivision
Improvements and other obligations of the Developer under this Agreement,
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including fees or costs due to the City by the Developer. To that end and
notwithstanding anything herein to the contrary, all requests by the Developer for
a reduction or release of the Security shall be evaluated by the City in light of that
principle.
4. Exhibit B of the Development Agreement shall be replaced with the attached
Exhibit B. 5. Exhibit C of the Development Agreement shall be replaced with the attached Exhibit C.
6. All other terms and conditions of the Development Agreement shall remain in full force and effect.
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IN WITNESS WHEREOF, the City and the Developer have executed this First
Amendment to the Development Agreement as of the date first written above.
CITY OF LAKE ELMO
By:_________________________________
Charles Cadenhead, Mayor By:_________________________________ Julie Johnson, City Clerk
STATE OF MINNESOTA ) ) ss. COUNTY OF WASHINGTON )
The foregoing instrument was acknowledged before me this ______ day of
___________________, 2021, by Charles Cadenhead and Julie Johnson, the Mayor and the City Clerk, respectively of the City of Lake Elmo, a Minnesota municipal corporation, on behalf of the City.
__________________________________
Notary Public
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U.S. HOME CORPORATION
By:________________________________
Its: _______________________________ STATE OF _________ ) ) ss. COUNTY OF ________ )
The foregoing instrument was acknowledged before me this _____ day of _________, 2021, by ___________________, the _______________ of U.S. Home Corporation, a Delaware corporation, on behalf of the corporation.
___________________________________
Notary Public
This document was drafted by: Kennedy & Graven, Chartered (SJS)
Fifth Street Towers
150 South 5th Street, Suite 700 Minneapolis, MN 55402 (612) 337-9300
B-1
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EXHIBIT A
Legal Description of the Property
All lots and outlots located within the plat of The Royal Golf Club at Lake Elmo 3rd Addition, according to the recorded plat thereof, County of Washington, State of Minnesota.
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EXHIBIT B
EXHIBIT B TO DEVELOPMENT AGREEMENT List of Plan Documents The following documents prepared by Carlson McCain and Pioneer Engineering, collectively constitute the Plans:
THOSE DOCUMENTS BY AS FOLLOWS: SHEET TITLE REVISION DATE
1-66 Royal Golf Club at Lake Elmo Preliminary Plans
7/15/2021
1-22 Royal Golf Club at Lake Elmo Phase 2 Grading, Development & Erosion Control Plans
7/15/2021
1-24 Royal Golf Club at Lake Elmo 3rd Addition Sanitary Sewer, Water Main, Storm Sewer and Street Construction Plans
7/15/2021
Royal Golf Club at Lake Elmo 3rd, Project #6036-00 Specifications
6/10/2021
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EXHIBIT C
EXHIBIT C TO DEVELOPMENT AGREEMENT Subdivision Improvements Cost/Security Amount Estimate CONSTRUCTION CATEGORY COST 125 percent
1 Grading $924,460 $1,155,575
2 Sanitary Sewer $485,113 $606,391
3 Watermain $583,951 $729,939
4 Storm Sewer (includes pond structures
and outfall pipes)
$666,871 $833,589
5 Streets and Sidewalks $884,687 $1,105,858
6 Trails $44,125 $55,156
7 Surface Water Facilities (ponds,
infiltration basins, other BMPs)
$23,149 $28,936
8 Street Lighting $48,000 $60,000
9 Street and Traffic Signs
$5,779 $7,224
10 Private Utilities (electricity, natural gas, telephone, and cable)
$0 $0
11 Landscaping Improvements $253,289 $316,611
12 Tree Preservation and Restoration $0 $0
13 Wetland Mitigation and Buffers $0 $0
14 Monuments
$7,300 $9,125
15 Erosion and Sedimentation Control $103,835 $129,794
16 Miscellaneous Facilities $0 $0
17 Developer’s Record Drawings
$5,000 $6,250
TOTALS $4,035,559 $5,044,448
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CITY OF LAKE ELMO WASHINGTON COUNTY
STATE OF MINNESOTA RESOLUTION NO. 2021-110
A RESOLUTION APPROVING THE FIRST AMENDMENT TO THE DEVELOPMENT AGREEMENT FOR THE ROYAL GOLF CLUB AT LAKE ELMO 3RD ADDITION
WHEREAS, the City of Lake Elmo is a municipal corporation organized and existing under the laws of the State of Minnesota; and WHEREAS, H.C. Golf Land, LLC, 11074 Radisson Road NE, Blaine, MN 55449
previously submitted an application to the City of Lake Elmo (the “City”) for a final plat for The
Royal Golf Club at Lake Elmo 3rd Addition; and WHEREAS, the Lake Elmo City Council adopted Resolution No. 2019-008 on December 4, 2018 approving the final plat for The Royal Golf Club at Lake Elmo 3rd Addition; and
WHEREAS, U.S. Home Corporation, a Delaware corporation d/b/a Lennar (the “Applicant”) subsequently acquired The Royal Golf Club at Lake Elmo 3rd Addition; and WHEREAS, the Lake Elmo City Council adopted Resolution No. 2021-075 on July 6,
2021, approving the Development Agreement for The Royal Golf Club at Lake Elmo 3rd Addition;
and WHEREAS, the Applicant and City have agreed to make certain non-substantive amendments to the approved Development Agreement.
NOW, THEREFORE, based on the information received, the City Council of the City of Lake Elmo does hereby approve the First Amendment to Development Agreement for The Royal Golf Club at Lake Elmo 3rd Addition and authorizes the Mayor and City Clerk to execute the First Amendment.
Passed and duly adopted this 19th day of October 2021 by the City Council of the City of Lake Elmo, Minnesota.
__________________________________ Charles Cadenhead, Mayor ATTEST: ________________________________
Julie Johnson, City Clerk