Posted: September 09, 2016
Rapid City
Agenda Item Summary

Agenda Item Ref. #: LF091416-09

Agenda Item Title:

Direction to staff regarding Master Development Agreement and all addendums thereto, including the Contract for Private Development for TID #73 with President’s Plaza L.L.C.

Origination Group:
Legal & Finance Committee
Origination Meeting Date:
09/14/2016
City Council Hearing Date:
09/19/2016
Staff Contact:
Joel Landeen, City Attorney
Agenda Item Summary:
On September 21, 2009, the City entered into a Master Development Agreement with St. Joe Investments to facilitate construction of a mixed use development and parking ramp on City owned land at the corner of St. Joseph and 5th Streets. This agreement has been amended several times. In 2011 the agreement and all amendments approved up to that point are assigned to President’s Plaza L.L.C (the “Developer”). In December of 2016 the City and Developer entered into a Fourth Addendum to the Master Development Agreement. Per the terms of this agreement, the Developer had until the end of June to initiate actual construction of the project. It is now September and no actual construction activities on the project have commenced. Per the agreement, the City has the right to terminate the Master Development Agreement and all addendums thereto if the Developer fails to meet any of the deadlines. Since the deadline for the Developer to initiate actual construction of the project has passed with no construction activity occurring, staff is seeking direction on how to proceed.

Funding Source & Fiscal Impact (if applicable):

Funding Cost Center
If the City decides to exercise its right to terminate the agreements it will potentially free up the Vision Funds dedicated to this project for other uses. The termination of these agreements could result in litigation by the Developer.

Recommendations:

Origination Recommendation Notes:
Action: Direct staff to send written notice of termination, or take no action. Notes: Staff is not making a recommendation. Whether or not to continue this project is a policy decision that needs to be made by the City’s elected officials.
City Council Options:
You can direct the City provide the Developer with written notice that the agreements are being terminated. You can take no action and the agreements will remain in full force and effect until either the project is commenced or you decide to terminate the agreements in the future. If you choose to not terminate the agreements at this time, it would be best if you provided staff with some direction on how to proceed.

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