Agenda - Public Works Committee - 06/16/2015

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Mr. Diers stated he did not want to hang onto this for the next few years, either. He noted the market is strengthening. He also pointed out this is not a development that would interest many developers as it is only seven homes. Chairperson Riley asked where in the agreement it states the City would be paid as lots are sold. He said he only noted where it said the City would be paid twice a year; in October and May. He asked if the language could be added relating to payment as the lots are sold. City Administrator Ulrich answered that language could be added. He explained the agreement is that the percentage that each lot is assessed would define the amount that is paid when the lot is sold. Chairperson Riley questioned whether the City was the Bank's only viable source of financing. Mr. Diers responded that is was. He said they cannot take out a loan from another bank and they cannot self -loan. He added that the assessments must be clear to deliver the title. Councilmember Shryock asked if there are any repairs that need to be done in the adjacent existing neighborhood and if they would be done as this development is in progress. Public Works Superintendent Reimer explained this development should not have much of an affect on the existing neighborhood. The roads in that neighborhood have recently been sealcoated, and the drainage is good. Chairperson Riley noted the assessments will average to $85,000 per lot. The allocation varies. He inquired if the amounts made sense with the anticipated selling price. Mr. Diers responded the higher value is placed on Lot 1, which has better access and view of the river. He stated he would like to see someone take interest in lot 7, so they could put up a model. The property would show better. He explained they are planning to add berming, and trees to create a buffer from the industrial area. This will add to the value of the homes, and ultimately to the tax base. City Administrator Ulrich commented this has been a patient developer. He said this may not have been developed if were in the private sector. He noted there have been many issues with this property over the years. There have been several potential uses for it. This plan capitalizes on the river, as well as the trail. The development will hopefully raise the level of the homes in the area. This unique project with the bank backing it makes it less of a precedent -setting development for the City. This project is relatively small, which means the bank can do it as a project and get it done in 3 years. The Finance Director approves of the financial situation. The City will get its return back, with 3.5% interest, which is more than with other investments. He noted the language to clarify the timing of paying assessments will be added to the agreement. Motion by Councilmember Johns, seconded by Councilmember Shryock to recommend that the City Council approve the draft Assessment Agreement for Ridgepoint residential development Public Works Committee / May 19, 2015 Page 4of8