ITEM 4.2B Waterfront East 6th AdditionOtkzoF
MINNESOTA V
DEPARTMENT INFORMATION
Request for
City Council Action
ORIGINATING DEPARTMENT:
REQUESTOR:
MEETING DATE:
Administration
Adam Flaherty, Finance Director
August 22, 2016
PRESENTER(s):
REVIEWED BY:
ITEM #:
Adam Flaherty, Finance Director
City Administrator Johnson
4.2 (B)
AGENDA ITEM DETAILS
RECOMMENDATION:
It is recommended by staff that the City Council approve a resolution authorizing the development
incentive for Waterfront East 6th Addition as established in a 2011 agreement with GCI Capital, Inc.
ARE YOU SEEKING APPROVAL OF A CONTRACT? IS A PUBLIC HEARING REQUIRED?
No No
BACKGROUND/JUSTIFICATION:
On June 29, 2011 the City entered into an agreement with GCI Capital, Inc., regarding parcels within the
Waterfront East Development. The agreement outlines that if improvements are made to the parcels
exceeding an established threshold, the developer would be entitled to established incentives. These
development incentives are payable for any respective improvements prior to December 21, 2021.
Nystrom & Associates, LTD has acquired Outlot B and is proposing to build a 27,892 square foot office
building. As outlined in the 2011 agreement, to be eligible for the development incentive, the land and
building improvements need to exceed $2,200,671. If the land and building improvements are certified
by the County Assessor to exceed the threshold, an incentive in the amount of $170,051.85 would be
payable to Nystrom & Associates, LTD.
Payment of the incentive for this parcel would come from the Capital Improvements Revolving Fund.
The City Council approved this as the funding source for the Waterfront East Incentives on November
23, 2015.
Not including the amount above, there is $573,716.85 of potential incentives remaining for parcels
within the Waterfront East Development. This amount has been informally reserved within the Capital
Improvements Revolving Fund to meet the potential payment of these incentives.
SUPPORTING DOCUMENTS: 39 ATTACHED NONE
0 Resolution 2016-72
POSSIBLE MOTION
Please word motion as you would like it to appear in the minutes.
-Motion to approve Resolution 2016-72 authorizing the development incentive for Waterfront East 6th
Addition.
BUDGET INFORMATION
FUNDING: BUDGETED:
Fund 414—Capital Improvements Revolving No
ACTION TAKEN
❑ APPROVED AS REQUESTED ❑ DENIED ❑ TABLED ❑ OTHER (List changes)
COMMENTS:
CITY OF OTSEGO
COUNTY OF WRIGHT
STATE OF MINNESOTA
RESOLUTION NO.2016-72
RESOLUTION REGARDING DEVELOPMENT INCENTIVE PAYMENT FOR
NYSTROM & ASSOCIATES, LTD- LOT 1, BLOCK 1 OTSEGO WATERFRONT
EAST SIXTH ADDITION
WHEREAS, Nystrom & Associates, Ltd. (OWNER) has been approved to construct an
office building upon LOT 1, BLOCK 1, OTSEGO WATERFRONT EAST SIXTH
ADDITION and has requested Council consideration of payment of certain Development
Incentives as originally set forth in that Agreement dated June 29, 2011 between the City
of Otsego (OTSEGO) and GCI Capital, Inc.; and which were subsequently assigned to
OWNER; and
WHEREAS, the Agreement provides for payment of Development Incentives in the total
amount of $170,051.85 upon completion of a building on the property valued at
$2,200,671.00 or above as per the terms and conditions of the above referenced June 29,
2011 Agreement; and
WHEREAS, the Development Incentive Payments are to be paid out of the Capital
Improvement Revolving Fund, as previously directed by the City Council.
NOW THEREFORE the CITY COUNCIL of the City of Otsego resolves as follows:
l . Upon, completion of the Nystrom & Associates, LTD office building on LOT 1,
BLOCK 1, OTSEGO WATERFRONT EAST SIXTH ADDITION and
verification of its value as meeting or exceeding $2,200,671.00 as required by the
Agreement between CITY and OWNER, CITY shall make payment of the
Development Incentive to OWNER in the amount of $170,051.85 as per the
Agreement.
2. The funds for the Development Incentive Payment shall come from the City's
Capital Improvement Revolving Fund.
3. City staff is hereby directed to undertake administrative procedures necessary to
effectuate this Resolution.
ADOPTED this 22nd day of August, 2016 by the City Council of the City of Otsego,
Wright County, Minnesota.
IN FAVOR:
OPPOSED:
CITYOF OTSEGO
Jessica Stockamp, Mayor
Tami Loff, City Clerk
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