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Home My WebLink AboutA001 - Council Action Form dated November 12, 2024ITEM #:33 DATE:11-12-24 DEPT:P&H SUBJECT:AMEND ISURP DEVELOPMENT AGREEMENT TO ALLOW RESIDENTIAL USE TAX CLASSIFICATION COUNCIL ACTION FORM BACKGROUND: At the time of development of Phase III of the Iowa State University Research Park (ISURP) in 2024 (See attachment for boundary), the City entered into a development agreement with ISURP to share in certain infrastructure costs, primarily through the use of Tax Increment Financing (TIF). One of the benefits of the agreement for the City was the assurance that the land within Phase III would only be used for development with a commercial or industrial tax classification to ensure property taxes would be generated as a result of the City's support. The Development Agreement limits use of individual properties to one of these two property tax classifications. Subsequent to the agreement, the City now allows through zoning for residential uses within certain areas of Phase III. Additionally, tax codes have changed as apartment uses are now classified as residential and not commercial. However, the Agreement still requires a commercial tax classification, which would result in a higher taxable value than apartments in other parts of the c i t y. To address this issue, an amendment to the Development Agreement has been prepared that acknowledges a residential classification is also an option in addition to commercial and industrial. The changes only apply to certain properties with residential use potential. (see Location Map). There are no other proposed changes to the agreement. ALTERNATIVES: 1. Approve the proposed amendment to the Development Agreement to add a residential use tax classification for specified properties. 2. Deny the amendment and continue to require commercial and industrial tax classifications. CITY MANAGER'S RECOMMENDED ACTION: Approving the change would align with Council's recent decision to allow residential uses on certain properties in this area of the Research Park. Allowing for the use and tax classification has no impact on the Urban Renewal Area and prior TIF collections. Therefore, it is the recommendation of the City Manager that the Council approve Alternative #1. ATTACHMENT(S): Location Map.pdf Amendment Development Agreement.PDF ISURP Phase III area boundary.jpg 1 WESSEX DR UNIVERSITY BLVD PLAZA LOOP COLLABORATION PL COLLABORATION PL UNIVERSITY BLVD COLLABORATION PL Ü Location Map Affected properties 2 AMENDMENT TO AGREEMENT FOR PUBLIC IMPROVEMENTS AND OTHER WORK PERTAINING TO THE IOWA STATE UNIVERSITY RESEARCH PARK PHASE III THIS IS AN AMENDMENT to an Agreement made by and between the City of Ames, Iowa, an Iowa Municipal Corporation, and Iowa State University Research Park, an Iowa non- profit corporation, upon the following terms and conditions: 1 DEFINITIONS. When used in this Amendment, unless otherwise required by the context: 1.1 “City” means the City of Ames, Iowa, an Iowa Municipal Corporation. 1.2 “Developer” means Iowa State University Research Park, an Iowa non-profit corporation, and Hunziker Construction Services, Inc., as owners of: 3200 University Boulevard – Lot 1 of the ISURP Phase III 2nd addition, 3300 University Boulevard – Lot 1 of the ISURP Phase III 1st Addition, and 1726 Collaboration Place – Parcel C of Lot 6 of the ISURP Phase III 1st Addition. 1.3 “Development Agreement” means the recorded Agreement, and any existing amendments thereto, presently in force between the City and Developer, its successors and assigns, filed in the office of the Recorder of Story County, Iowa, on November 18, 2014, as Instrument No. 2014-00010311, as approved by City Resolution No. 14-517 governing certain improvements upon the Real Property by Developer and certain tax increment financing rebates granted by the City. 1.4 “Amendment” means this instrument as signed by the parties hereto. 1.5 “Site” means the real property (together with all easements and serviant estates appurtenant thereto) legally described as Exhibit A attached hereto. 2 AMENDMENT.The Development Agreement, in the first paragraph of IX Property Taxes, is hereby amended by adding the word “residential” as follows: “It is expressly understood, covenanted, and agreed by the parties hereto that all of the land encompassed by the aforesaid Phase III Conceptual Development Plan and any and all improvements now or hereafter pertaining to said land, shall be subject to any and all taxes on real estate that normally would be generated as a commercial, industrial or residential classified parcel, regardless of each parcel’s actual classification or exempt status; and that S P A C E A B O V E R E S E R V E D F O R O F F I C I A L U S E Return document to:City Clerk, 515 Clark Avenue, Ames IA 50010 Document prepared by:Mark O. Lambert,City of Ames Legal Department, 515 Clark Ave., Ames, IA 50010 –515-239-5146 3 2 the Research Park shall not claim or apply for any exemption from or abatement of property taxes for said land or improvements.” . . . 3 CONTINUED FULL FORCE. The Development Agreement shall continue to have full force and effect in accordance with the terms thereof, subject, however, to this Amendment. IN WITNESS WHEREOF, the City and Developer, and Developer’s successor and assigns, have executed this Amendment on the dates shown below. [Signature pages to follow] 4 3 ISU RESEARCH PARK Dated ______________________, 2024.By: Rick Sanders, President Iowa State University Research Park STATE OF IOWA, COUNTY OF STORY, SS.:This instrument was acknowledged before me on ___________________________, 2024, by Rick Sanders, as President of the Iowa State University Research Park. NOTARY PUBLIC 5 4 HUNZIKER CONSTRUCTION SERVICES, INC. Dated ______________________, 2024.By: Charles E. Winkleblack, President Hunziker Construction Services, Inc. STATE OF IOWA, COUNTY OF STORY, SS.:This instrument was acknowledged before me on ___________________________, 2024, by Charles E. Winkleblack, as President of Hunziker Construction Services Inc. NOTARY PUBLIC 6 5 Passed and approved on ______________________, 2024, by Resolution No. 24-______________, adopted by the City Council of Ames, Iowa. CITY OF AMES, IOWA Attest:By: Renee Hall, City Clerk John A. Haila, Mayor STATE OF IOWA, COUNTY OF STORY, SS.: This instrument was acknowledged before me on ____________________________, 2024, by Renee Hall and John A. Haila, as City Clerk and Mayor, respectively, of the City of Ames, Iowa. NOTARY PUBLIC 7 8 9