Consideration and Possible Adoption of Resolution No. 2021-44:  A resolution authorizing the execution of the First Amendment to the Mill Town Development Agreement between Vintage Partners, LLC and the City of Flagstaff related to the development of approximately 18.11 acres of real property generally located at 1801 South Milton Road.

State law allows the City to enter into development agreements by resolution of the City Council.  The First Amendment to the Mill Town Development Agreement will be between Vintage Partners, LLC and the City of Flagstaff.  The development agreement amendment governs the terms and conditions of the entitlements, transportation improvements, construction budget and payments, and requirements for on and off-site improvements.  The proposed Mill Town project consists of a total of 18.11 acres which includes future development parcels and the city right-of-way located generally at 1801 South Milton Road.

***The amendment to the Development Agreement will be provided with the final agenda***

The City has budgeted funds for the Combined Roadway project as defined in the Development Agreement in the Transportation tax 5-year capital improvement plan.  The project is currently still in design and final estimates have not yet been prepared.  Additionally, funds may be need to identified for this project.

There are no policy impacts affiliated with this development agreement.

Priority Based Budget Key Community Priorities and Objectives
Identify smart traffic management, multi-modal transportation, and alternative energy opportunities

Regional Plan
Goal T.1 Improve mobility and access throughout the region.
Goal T.2 Improve transportation safety and efficiency for all modes.

The City Council approved a Zoning Map Amendment, Preliminary Plat and Development Agreement for the Mill Town project, as part of a public-private-partnership (P3), on April 17, 2018.  The P3 project was formalized through a Pre-Development Agreement between Vintage, the City, and the Arizona Department of Transportation in March 2015.  

1. Approve the First Amendment of the Mill Town Development Agreement as presented.
2. Approve the First Amendment of the Mill Town Development Agreement with additional, modified, or deleted terms.
3. Remand the First Amendment of the Mill Town Development Agreement back to staff for additional negotiations with Vintage Partners.
4. Deny the First Amendment of the Mill Town Development Agreement.

On May 16, 2000, the voters of Flagstaff passed proposition 403 which established the local transportation tax 2000 to provide funding for a variety of transportation system improvements including the arterial and collector street system, and multi-modal elements.  The information pamphlet for this proposition specifically identified the Beulah Boulevard extension and the University Avenue realignment as “missing links” within the overall transportation network.   The exhibit for this proposition showed an alignment for these roadways similar to the current proposal. The transportation tax has been collected on a pay-as-you-go-basis with a total of $7.375 million allocated for these transportation improvements.  These funds became 100% available as of July 1, 2017; however, many years of work have been spent on moving this project forward.
 
In 2005, the City of Flagstaff acquired APN 103-21-002, a 9.58-acre site known as the “Fresquez Parcel” for approximately $2.7 million.  This purchase was the first step in moving this transportation project to fruition and provides the majority of right-of-way necessary to accomplish the Beulah Boulevard extension.  In order to accomplish the University Avenue/Drive realignment, the ADOT District Offices and Regional Laboratory needed to be relocated. 
 
The City and ADOT began to explore options for partnerships in order to relocate the ADOT facilities.  In July 2009, the Arizona P3 (Public-Private-Partnership) Legislation was passed, allowing for partnerships between a public agency (in this case two public agencies) and a private-sector entity to allow greater participation in the delivery of a transportation project.  Typically, the public agency assumes all the risks and responsibilities for a transportation project, but under the P3 the private partner takes on some of those risks and responsibilities.  The Flagstaff P3 is the first time this initiative has been used to acquire new facilities for ADOT, which freed up land for roadway improvements and redevelopment.  A Memorandum of Understanding was executed on March 28, 2012, and set out the parameters for how this P3 project would function.  The City and ADOT would combine the remainders of their parcels after right-of-way dedication to be used for redevelopment.  The redevelopment parcel would then be traded from ADOT to the developer for relocated ADOT facilities.  
 
ADOT issued a Request for Qualifications in March 2012 to solicit a private partner who could relocate the ADOT facilities allowing for the construction of the road improvement project.  The selected private sector partner was Vintage Partners, who proposed to relocate the ADOT facilities to the former Harkins Theater on Woodlands Village Boulevard.  The P3 project was formalized through a Pre-Development Agreement (PDA) between Vintage, the City, and ADOT in March 2015.  This PDA granted Vintage Partners the authority to apply for the required entitlements to pursue redevelopment of the remaining lands.  ADOT and the City agreed to cooperate in good faith with Vintage Partners in order to process these entitlements, recognizing that the Flagstaff City Council retains its full discretion to approve or deny the entitlement applications.  The PDA also committed a total of $7.375 million for the extension of Beulah Boulevard and the realignment of University Avenue, which was to be completed by Vintage Partners in conjunction with their redevelopment project.  

The primary purpose of the proposed amendment to the Mill Town development agreement is to reassign responsibility for the administration of the remaining design and construction of the Combined Roadway Project which is defined as the City's transportation improvements, the University Avenue sewer upgrade, and the Milton pedestrian and bicycle underpass.  The amendment further defines Vintage Partners' contribution to construct the Combined Roadway Project with financial responsibilities remaining the same.  Vintage Partners will pay the City $1.65 million as soon as the City has entered into a contract for construction of the Combined Roadway Improvements and the City will construct the underpass in conjunction with the City's transportation improvements.  Vintage Partners will reimburse the City for the remainder of its share within five years of the City's acceptance of final underpass improvements.  The City will lien a portion of the Mill Town property for the unpaid costs on the underpass in conjunction with the execution of the development agreement amendment.

Neighborhood meetings are not required for amendments to development agreements.  No public meetings have been held in regard to this proposed amendment.