HomeMy WebLinkAboutA067 - Council Action Form dated October 13, 2015 sy ti
ITEM # 22
Date 10-13-15
COUNCIL ACTION FORM
SUBJECT: REQUEST TO RELEASE ASSESSMENT AND UTILITY CONNECTION
FEE OBLIGATION FOR LOT 14 OF EASTGATE SUBDIVISION
BACKGROUND:
First National Bank recently sold Lot 14 of the Eastgate Subdivision to Friedrich/Iowa
Realty. In 1998, the original Eastgate developer signed a development agreement
promising payment for improvements to roads and utilities in the area. The development
was then the subject of a bankruptcy proceeding, and in 2001, the City entered into a
covenant that modified the owner's public infrastructure obligations. The property was
ultimately acquired by First National Bank through the bankruptcy proceeding.
The covenant requires payment to the City for the estimated costs of widening Dayton
Avenue for a turn lane and for connections to water and sewer service. This payment is
to be made upon the sale or transfer of each lot. The covenant pro-rates the amount
owed for each lot on the basis of each lot's land area. The road widening cost was
revised in 2004 to reflect increased construction costs. In 2005, First National Bank
paid the outstanding utility tapping fees owed on Lot 14 and the other 12 lots it
owned, leaving only the road widening assessment outstanding.
The City is owed $38,010 upon the sale of Lot 14 for the widening of Dayton Avenue.
Payment in that amount was received by the City on September 30. The 12 lots
remaining in the subdivision have been apportioned $94,710 in road widening costs,
which is due to be paid to the City as they are sold in the future.
ALTERNATIVES:
1. Accept payment in the amount of $38,010 and authorize the release of assessment
and utility connection fee obligation for Lot 14, Eastgate Subdivision.
2. Do not accept payment and do not authorize the release of the assessment and
utility connection fees for Lot 14, Eastgate Subdivision.
MANAGER'S RECOMMENDED ACTION:
The covenant on this property requires payment of $38,010 for road widening costs
upon the sale or transfer of this property from its current owner. The buyer of the
property has now remitted payment in that amount to the City.
1
Therefore, it is the recommendation of the City Manager that the City Council adopt
Alternative No. 1, thereby accepting payment in the amount of $38,010 and authorize
the release of assessment and utility connection fee obligation for Lot 14, Eastgate
Subdivision.
2