Agenda - Economic Development Authority - 06/08/2023

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Economic Development Authority (EDA) 4.1. Meeting Date: 06/08/2023 By: Sean Sullivan, Community Development Title: Consider Approval of Amended and Restated Right of Re -Entry Agreement: Stories Foundation Purpose/Background: Stories Foundation purchased Outlot B, COR Stone Brook Academy from the City of Ramsey on December 29, 2021. The cost for the land was $67,953.60. The closing required the filing of a Right of Re -Entry Agreement requiring a Certificate of Occupancy for a minimum 12,000 square foot retail building by December 31, 2023. The Site Plan Approval has expired and a new Site Plan and Plat Application are needed to be submitted and to be reviewed by the Planning Commission and ultimately approved by the City Council for the project to move forward. It would be near impossible for the Developer to be able to get through the site plan process and complete construction of the project by December 31, 2023. The Developer has communicated to the City that slower than anticipated fundraising and rising costs of construction for the proposed project have caused the project to be delayed. The developer has asked the City of Ramsey to consider one-year extension to the Right of Re -Entry Agreement that would change the required Certificate of Occupancy date to December 31, 2024. The purpose of the Right of Re -Entry Agreement is to prohibit land speculation and to guarantee a certain type of development to occur when the City sells City -owned property. The current Right of Re -Entry Agreement has two remedies that the City could exercise upon Stories Foundation in the event that a Certificate of Occupancy is not issued by December 31, 2023.. One option is to re-enter the property and take possession. The other option would be to impose a $50,000 penalty on the Developer and to let the Developer retain the property. In the event that an Amended and Restated Right of Re -Entry Agreement is not approved the EDA should be prepared make a recommendation on which remedy to exercise. To ensure the Buyer is making demonstrable progress, Staff recommends that approval of the Amended and Restated Right of Re -Entry Agreement be contingent on City Council approval of the new Site Plan, Development Agreement and Final Plat. Notification: Notification is not required. Observations/Alternatives: Observations: Stories Foundation is requesting the Certificate of Occupancy date in the recorded Right of Re -Entry Agreement be changed from December 31, 2023 to December 31, 2024. The EDA must determine if this request is reasonable and make a recommendation to the City Council. Staff has put together a number of alternatives to consider based on the consensus of the EDA. Alternatives: Option 1 - Approve Extension of Right of Re -Entry Agreement from 12/31/23 to 12/31/24 1. Motion to recommend to the City Council to approve the Amended and Restated Right of Re -Entry Agreement with contingencies (Site Plan Approval, Development Agreement Approval, Final Plat Approval) (as presented); subject to City Attorney review. 2. Motion to recommend to the City Council to approve the Amended and Restated Right of Re -Entry Agreement with contingencies (Site Plan Approval, Development Agreement Approval, Final Plat Approval) (with changes); subject to City Attorney review.