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HomeMy WebLinkAboutA020 - Letter from City Clerk dated August 18, 1988 I I AMES CITY OF AMES , iowA 50010 01 1 -q� „gWY City Administration Building 621 Main 1982-1983 Ames, IA 50010 (515)239-5105 CITY CLERK'S OFFICE August 18, 1988 Merchants Mutual Bonding Company 2100 Grand Avenue Des Moines, IA 50312 Dear Sirs: The City of Ames is no longer in need of the $281,270 Performance Bond dated July 1987 from Merchants Mutual Bonding Company. This Performance Bond was issued for work done for the Green Hills Road for the Green Hills Company of Ames, Inc. It is the City' s understanding that this Performance Bond is null and void. I am sending this letter because the original Performance Bond cannot be located. If you should have any questions regarding this matter, please contact our office. Sincerely, �__7Nancy Dionigi�_ Acting City Clerk jlr Enclosures AMES — THE CENTER OF IT ALL a . SURETY BOND BOND NO. IA 509075 KNOW ALL MEN BY THESE PRESENTS, that we, Green Hills Company of Ames, Inc. and the Iowa State University Achievement Fund, jointly as princi- pal , of the County of Story and State of Iowa, and Merchants Bonding Company (Mutual) of the County of Polk and State of Iowa, as Surety are held and firmly bound unto the City of Ames, Iowa in the sum of Two Hundred Eighty-One Thousand Two Hundred Seventy Dollars ($281,270.00, good and lawful money of the United States of America, to be paid to the said City of Ames for the payment whereof said principal and Surety bind themselves firmly by these presents. WHEREAS, Green Hills Company of Ames, Inc. and the City of Ames has entered into an agreement dated April 24, 1984 entitled "Agreement for L Construction of the Green Hills Road, Gateway Center Subdivision, Ames, Iowa." Paragraph 7 of the Agreement calls for the granting to the city a first mortgage lien on Lot 6 of the subdivision to secure repayment of the City of Ames for certain street improvements.. As such a lien would seriously disrupt the ability of Green Hills to construct subsequent phases in the Health Center, the substitution of this performance bond for the first lien mortgage is acceptable. NOW THEREFORE, the conditions of this obligation is such, that in the event that the increased property taxes paid as a result of construction of the improvements on Lot 1 of Gateway Center Subdivision, pay back in full the cost of the construction of Green Hills Drive, then this obligation to be void; otherwise to remain in full force and effect until 5:00 p.m. December 31, 1993. Demand must be made by the City of Ames, by certified mail , upon both the principal and surety within 90 days of the expiration date of this bond. Signed this loth— day of y,nP 19 R7 GREEN HILLS COMPANY OF AMES, INC. MERCH BOND G 0 ANY (MUTUAL) Principal uret John Bedn rz, As i_stant Vice Pres. IOWA STATE UNIVERSITY ACHIEVEMENT FUND Principal t RESOLUTION NO. 88-253 RESOLUTION APPROVING UNSECURED BOND FROM IOWA STATE UNIVERSITY (ISU) ACHIEVEMENT FOUNDATION FOR TAX PAYMENTS AND PAYMENTS IN LIEU OF TAXES -- GREEN HILLS ROAD AGREEMENT WHEREAS, the City of Ames previously entered into an agreement with the developers of Green Hills whereby $281,370 worth of General Obligation bonds were issued to finance the construction of the Green Hills road, and included in this contract was an agreement by the developers that the City would receive additional taxes in the amount stated above within seven years from o the completion of the road; and WHEREAS, if the City did not receive such amount as above stated, the developer would pay the difference to the City at the conclusion of this term, and in order to secure this agreement, the developers granted to the City a first mortgage lien on a lot in Phase I of the Green Hills retirement development; and WHEREAS, at a later date, the developers contacted the City and explained that this lien seriously hampered their ability to secure additional financing for expanding their health care facility and, therefore, asked the City to substitute this first mortgage lien for a performance bond; and WHEREAS, the City has now been contacted by the administrator for Green Hills and the attorney for the ISU Achievement Foundation requesting that the City relieve them of the obligation to provide the performance bond; and WHEREAS, the Green Hills retirement project has generated incremental tax receipts in the amount of $104,446, thereby leaving a balance of $176,924; based on this information, this obligation should be satisfied by tax year 1990-91, assuming all taxes are paid. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Ames, Iowa, that the request from the Green Hills representatives is hereby approved and adopted as attached hereto and made a part hereof by this reference and the performance bond security requirement in the City's current agreement is waived subject to the ISU Achievement Foundation executing an agreement and guaranteeing the payback provision of the City's existing Green Hills road contract. ADOPTED THIS 2nd day of August, 1988. Nancy i nig1, c ng ,ty er 4Paul an , May Introduced by: Curtis Seconded by: Thurston Voting aye: Brown, Curtis, Hoffman, Thurston Voting nay: None Absent: Campbell , Parks Resolution declared adopted and signed by the Mayor this 2nd day of August, 1988.