Approval of this action item will provide the authorization to proceed with negotiations and the sale of City-owned property to the State of Arizona.

 

ADOPT RESOLUTION NO. 2025-2474 APPROVING PURCHASE AGREEMENT WITH THE STATE OF ARIZONA RELATED TO THE EXTENSION OF STATE ROUTE LOOP 303, AUTHORIZING STAFF TO MAKE CHANGES, IMPOSING CONDITIONS FOR THE EXECUTION OF THE PURCHASE AGREEMENT AND AUTHORIZING EXECUTION OF DOCUMENTS. (Kimberly Romero, Real Estate Supervisor)

The State of Arizona Department of Transportation (ADOT) and the City must come to a mutually agreed-upon purchase agreement, conveying deed, temporary construction easement, and right of entry; the square footage of the City-owned property being acquired must be confirmed, including all minor terms related to the future easements required that are being finalized.

All costs associated with the extension of State Route Loop 303 will be borne by ADOT, except for items identified in a separate agreement that are included in the fiscal year 2026 budget. This agreement will result in the City receiving compensation for currently City-owned property based on ADOT's appraised value of $12.00 per square foot as well as $111,636 for a temporary construction easement. The estimated $32.6 million of revenue for the sale of property was not anticipated as a part of the budget.

ADOT is extending State Route Loop 303 (Loop 303) by designing and constructing the section of Loop 303 between Maricopa County Route 85 (MC 85) and Van Buren Street. Since the Loop 303 project runs through the City, ADOT must acquire portions of City right-of-way, City-owned property, and temporary construction easements. As part of the Loop 303 Project, various City-owned water and wastewater lines and appurtenances must be relocated. Frontage roads along the east and west sides of the Loop 303 Project need to be constructed, so that it may provide access to the adjacent properties. 

City and ADOT staff have been negotiating responsibility for the costs of relocating the City-owned water and wastewater lines, appurtenances, and the costs of constructing the frontage roads along the east and west sides of Loop 303 to provide access to the adjacent properties. In consideration of the State's agreement, pursuant to an intergovernmental agreement, to be responsible for these costs, City staff is supporting the acceptance of the State's offer, based on ADOT's appraisal, to acquire the City-owned property for $12.00 per square foot and to acquire the temporary construction easement ADOT is seeking for $111,636.00. 

Although the amount of compensation has been agreed upon, the purchase agreement has not yet been finalized. City staff are verifying the actual square footage being acquired. City and ADOT staff are working through minor terms related to the easements that the City requires. 

The offer presented by ADOT will impact seven City-owned parcels within the project corridor. Three of the impacted parcels will be partial acquisitions, and four of the impacted parcels will be full acquisitions. City staff has worked diligently to review all documentation provided in ADOT’s offer to purchase the land rights needed for ADOT’s project. All documentation and responses have been reviewed and provided to ADOT.

Accordingly, city staff recommends that the Mayor and Council adopt Resolution No. 2025-2474, included as Attachment A, which authorizes execution of a purchase agreement with the State of Arizona related to the extension of Loop 303. The draft purchase agreement is included for reference as Attachment B.