| ITEM #: 12. DATE: 10/25/2021 AI #:502 |
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CITY COUNCIL ACTION REPORT
| SUBJECT: | THIRD AMENDMENT TO DEVELOPMENT AND FIRE SERVICES AGREEMENT |
| STAFF PRESENTER(S): | Philip Cochran, Development Agreement Coordinator |
SUMMARY
The Third Amendment to Development and Fire Services Agreement allows for the City to reimburse Impact Fees previously collected for the construction of Fire Station 186 as well as the ongoing reimbursement of impact fees until the contributions made by NNP III Estrella Mountain Ranch, LLC are completely reimbursed.
Recommendation
ADOPT RESOLUTION NO. 2021-2182, APPROVING THE THIRD AMENDMENT TO DEVELOPMENT AND FIRE SERVICES AGREEMENT; PROVIDING AUTHORIZATION AND DIRECTION TO TAKE ACTIONS AND EXECUTE DOCUMENTS NECESSARY TO CARRY OUT THE INTENT OF THE RESOLUTION AND DEVELOPMENT AGREEMENT AND PROVIDING FOR AN EFFECTIVE DATE. (Philip Cochran, Development Agreement Coordinator)
FISCAL IMPACT
The City will be responsible for reimbursing the south area fire impact fees collected to NNP III Estrella Mountain Ranch, LLC at the end of each quarter beginning 30 days following the approval of the Third Amendment to Development and Fire Services Agreement. Additionally within 30 days the City will pay to NNP III Estrella Mountain Ranch, LLC the south area fire impact fees collected prior to July 1, 2021 that were designated for, or otherwise required to be used for the design, construction, equipping, and installation of the fire station totaling $1,243,154.04. Approval of the attached resolution authorizes actions necessary to carry out the intent of the resolution which includes authorization to expend funds and any budget transfer that may be required.
BACKGROUND AND PREVIOUS ACTIONS
The City of Goodyear entered into a Development and Fire Services Agreement on May 22, 2006 and subsequently entered into the First Amendment to the Development and Fire Services Agreement on January 23, 2017 and the Second Amendment to the Development and Fire Services Agreement on May 23, 2018.
STAFF ANALYSIS
The City of Goodyear (City), NNP III-Estrella Mountain Ranch, LLC (NNP) and AV Homes of Arizona, LLC, (AV Homes), entered into a Development and Fire Services Agreement on May 22, 2006 to agree on the locations of two fire stations and funding for the construction and operation of one fire station in the master planned community of Estrella. This agreement obligated NNP and AV Homes to provide land for the first fire station that would be valued at $80,000.00 per acre and funding for the construction of the fire station that would be capped at $5,420,000.00. The value of the land conveyed to the City as well as the funding for the construction of the fire station would subsequently be reimbursed through giving NNP and AV Homes credits towards the payment of fire impact fees within Estrella.
The City, NNP and AV Homes subsequently entered into the First Amendment to the Development and Fire Services Agreement on January 23, 2017 to change the expected locations of the fire stations as well as the location of the first fire station that would be constructed. The City, NNP and AV Homes then entered into the Second Amendment to the Development and Fire Services Agreement on May 23, 2018, to modify again the locations of the fire stations as well as the location of the first station to be constructed. Per the Second Amendment to the Development and Fire Services Agreement the City, NNP and AV Homes agreed that the first fire station would be constructed on Willis Road east of Rainbow Valley Road, this station was named Fire Station 186. Construction of Fire Station 186 began in March 2020 with a budget of $9,093,000.00; the station was completed in December 2020.
NNP and AV Homes provided funding and land for the construction of Fire Station 186, totaling $5,985,026.11. However, $177,000 was used for design work that became unusable and the parties agreed that this portion of the funding would not be reimbursable to NNP and AV Homes. The City, NNP and AV homes agreed that $5,808,026.11 would be reimbursable.
The City, NNP and AV Homes now wish to modify the agreement to allow the City to reimburse NNP and AV Homes by paying NNP and AV Homes the fire impact fees collected by the City in the south area rather than the City issuing a credit towards the payment of fire impact fees. This reimbursement process is consistent with other agreements the City has entered into with NNP.
Prior to fiscal year 2022, the City had collected $1,243,154.04 in south area fire impact fees, upon approval of the agreement these previously collected fees would be immediately reimbursed to NNP and AV Homes. Beginning in fiscal year 2022, the City would reimburse 100% of the fire impact fees collected in the south area to NNP and AV Homes at the end of each calendar quarter until NNP and AV Homes is reimbursed a total of $5,808,026.11.
The City, NNP and AV Homes subsequently entered into the First Amendment to the Development and Fire Services Agreement on January 23, 2017 to change the expected locations of the fire stations as well as the location of the first fire station that would be constructed. The City, NNP and AV Homes then entered into the Second Amendment to the Development and Fire Services Agreement on May 23, 2018, to modify again the locations of the fire stations as well as the location of the first station to be constructed. Per the Second Amendment to the Development and Fire Services Agreement the City, NNP and AV Homes agreed that the first fire station would be constructed on Willis Road east of Rainbow Valley Road, this station was named Fire Station 186. Construction of Fire Station 186 began in March 2020 with a budget of $9,093,000.00; the station was completed in December 2020.
NNP and AV Homes provided funding and land for the construction of Fire Station 186, totaling $5,985,026.11. However, $177,000 was used for design work that became unusable and the parties agreed that this portion of the funding would not be reimbursable to NNP and AV Homes. The City, NNP and AV homes agreed that $5,808,026.11 would be reimbursable.
The City, NNP and AV Homes now wish to modify the agreement to allow the City to reimburse NNP and AV Homes by paying NNP and AV Homes the fire impact fees collected by the City in the south area rather than the City issuing a credit towards the payment of fire impact fees. This reimbursement process is consistent with other agreements the City has entered into with NNP.
Prior to fiscal year 2022, the City had collected $1,243,154.04 in south area fire impact fees, upon approval of the agreement these previously collected fees would be immediately reimbursed to NNP and AV Homes. Beginning in fiscal year 2022, the City would reimburse 100% of the fire impact fees collected in the south area to NNP and AV Homes at the end of each calendar quarter until NNP and AV Homes is reimbursed a total of $5,808,026.11.