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Home My WebLink About10763RESOLUTION NO. 10763 A RESOLUTION APPROVING AN AMENDMENT TO THE INTERGOVERNMENTAL PUBLIC FACILITIES AGREEMENT RELATING TO THE PUEBLO CROSSINGS DEVELOPMENT BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The Amendment to Intergovernmental Public Facilities Agreement between the City of Pueblo, North Gateway Number 1 Public Improvement Corporation, North Gateway Number 1 Business Improvement District and Orix Pueblo, LLC dated as of June 12, 2006, a copy of which is attached hereto, is hereby approved. The President of the City Council is authorized to execute the Amendment in the name of the City. SECTION 2. This Resolution shall become effective upon final passage and approval. NTRODUCED June 26, 2006 BY Randy Thurston Councilperson APPROVED: President of City Council ATTESTED BY: CITY CLERK Oki ELI ff- M I Background Paper for Proposed RESOLUTION AGENDA ITEM # 18 DATE: June 26, 2006 DEPARTMENT: Law Department TITLE A RESOLUTION APPROVING AN AMENDMENT TO THE INTERGOVERN- MENTAL PUBLIC FACILITIES AGREEMENT RELATING TO THE PUEBLO CROSSINGS DEVELOPMENT ISSUE Should City Council approve substantial adjustment in reimbursement to Orix Pueblo, LLC relating to the development of Phase 1 and 2 of the Pueblo Crossings Project? RECOMMENDATION None BACKGROUND Orix Pueblo, LLC ( "Orix") is developing the project commonly referred to as the Pueblo Crossings Project ( "Development "). The City, Orix, North Gateway Number 1 Public Improvement Corporation ( "Corporation ") and North Gateway Number 1 Business Improvement district ( "BID ") entered into an Intergovernmental Public Facilities Agreement ( "IGA ") with respect to the Development. Pursuant to the IGA, Orix is to be reimbursed for certain costs associated with the Development. These costs are identified as those for the BID Project (development of the Platteville 1 -25 interchange, particularly as it relates to the Dillon Flyover, including roads, utilities, structures and related public facilities in connection with the Development) and those for the Corporation Project (certain extraordinary public improvements). Orix's reimbursable costs were identified by separate exhibits to the IGA, Exhibit F- PIF qualified Costs with respect to the Corporation Project and Exhibit G -BID Qualified costs with respect to the BID Project. Orix has submitted invoices for reimbursement of costs for Phase 1 of the Development, requests to modify both the BID Qualified costs and PIF Qualified Costs for Phase 1 and that portion of Phase 2 of the Development shown on Exhibit A to the IGA included within Pueblo Crossings, Filing No. 2 Subdivision (herein "Phase 2 of the Developments) and claims that if the modifications are not approved it will not be economically feasible for Orix to proceed with the Phase 2 of the Development. Orb's requested reimbursement for Phase 1 PIF Qualified Costs is $1,476,440 more than the original amount of Phase 1 PIF Qualified Costs and the requested PIF Qualified Costs for Phase 2 of the Development is $390,903, or an increase of $1,867,347 to a total of $7,063,685.47. Reimbursements for PIF Qualified Costs are paid from the 0.05% public improvement fee added to items sold by retailers within the Development. The requested reimbursement for Phase 1 BID Qualified Costs is $1,353,055 and requested reimbursement for Phase 2 of the Development is $2,147,487, or a total of $3,500,542. Reimbursements for BID Qualified Costs are paid out of revenues from one -half (' /2) cent of City's three and one -half (3.5) cent tax received by City from sales within the Development. The Amendment adjusts Orix's reimbursement in accordance with the above computations. FINANCIAL IMPACT See Background OA, AMENDMENT TO INTERGOVERNMENTAL PUBLIC FACILITIES AGREEMENT THIS Amendment to Intergovernmental Public Facilities Agreement ( "the Amendment') is entered into as of June 26, 2006 among the City of Pueblo, Colorado (the "City "), North Gateway Number 1 Public Improvement Corporation (the "Corporation "), North Gateway Number 1 Business Improvement District (the "BID ") and Orix Pueblo, LLC (the "Developer "). The City, BID, Corporation and Developer are sometimes referred to as the "Parties." Recitals A. The Parties entered into an Intergovernmental Public Facilities Agreement dated as of November 24, 2003 (the "IGA "). B. All capitalized terms used in the Amendment shall have the meanings ascribed to them in the IGA, except that for the purposes of this Amendment, Phase 2 of the Development means that portion of Phase 2 shown on Exhibit A to the IGA included within Pueblo Crossings, Filing No. 2 Subdivision. C. Developer claims it has incurred or will incur costs associated with the BID Project and Corporation Project for Phase 1 and Phase 2 of the Development, which are in excess of the PIF Qualified Costs and the BID Qualified Costs set forth in Exhibits F and G attached to the IGA. D. . Developer has submitted invoices for payment of Phase 1 Bid Qualified Costs in the amount of $1,353,054.88, plus interest, and has proposed that Phase 2 Bid Qualified Costs be established at $2,147,487.36, plus interest. E. Developer claims that if the BID Qualified Costs and PIF Qualified Costs are not increased, it would not be financially feasible for Developer to develop Phase 2 of the Development. F. In order to permit Developer to proceed with the development of Phase 2 of the Development, the Parties are entering into this Amendment. NOW, THEREFORE, for and in consideration of the foregoing recitals, the mutual covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows: 1. Exhibit F - PIF Qualified Costs and Exhibit G - BID Qualified Costs, attached to the IGA, shall be amended and Exhibit F - PIF Qualified Costs and Exhibit G - BID Qualified Costs attached to this Amendment shall be substituted therefor. Notwithstanding anything in the IGA to the contrary, (a) After closing of the purchase of Phase 2 of the Development by Developer, interest on outstanding and unpaid BID Qualified Costs shall accrue at the one month LIBOR interest rate, plus 250 basis points as indicated in Exhibit G to this Amendment. 3. The amounts set forth in Article III(2) of the IGA for Developer reimbursement for its costs are amended to read, for BID Qualified Costs - the maximum amount of $3,500,542.24, plus interest as indicated in Exhibit G attached to this Amendment, and for PIF Qualified Costs - the maximum amount of $7,063,685.47 plus interest, as indicated in Exhibit F to this Amendment. 4. Article I1I(4) of the IGA is modified by the addition of the following: ; provided, however, that the estimated Construction Schedule for Phase 2 of the Development is August 1, 2006 to completion on December 1, 2007. 5. For purposes of clarification, the invoices and supporting documents submitted for reimbursement pursuant to Article I(3) and Article II(5) of the IGA shall identify by line item the cost sought to be reimbursed. 6. Developer has submitted invoices and supporting documents for payment in the following aggregate amounts for Phase I of the Development: (a) BID Qualified Costs - $1,353,054.88, plus interest as indicated in Exhibit G attached to this Amendment. (b) PIF Qualified Coss - $6,672,782.21, plus interest as indicated in Exhibit F to this Amendment. Developer represents that (i) the invoices and supporting documents are true and accurate, (ii) the amounts included in the invoices have not been included in any prior invoice for payment, (iii) the BID Qualified Costs or PIF Qualified Costs, whichever is applicable, identified in the invoices constitute a part of the BID Project or Corporation Project, whichever is applicable, and are included within the BID Qualified Costs set forth in Exhibit G to this Amendment or are included within the PIF Qualified Costs set forth in Exhibit F to this Amendment, whichever is applicable, (iv) the BID Qualified Costs and PIF Qualified Costs identified in the invoices have been completed, and (v) Developer has paid the BID Qualified Costs and PIF Qualified Costs identified in the invoices. Therefore, based on such representations (a) the Board of Directors of the BID approves the payment of the invoices in the amount of $1,353,054.88, plus interest as indicated in Exhibit G to this Amendment, and (b) the Board of Directors of the Corporation approves the payment of the invoices in the amount of $6,672,782.71, plus interest as indicated in Exhibit F to this Amendment. 7. The IGA as amended by this Amendment shall remain in full force and effect, binding upon and inuring to the mutual benefit of the parties and their respective successors and assigns. Executed in Pueblo, Colorado, the day and year first above written. -2- ORIX PUEBLO, LLC By: Orix Real Estate Capital, Inc. Name: QkAQ (NZV 3f3 Title: CITY OF PUEBLO President of the City Council NORTH GATEWAY NUMBER 1 BUSINESS IMPROVEMENT DISTRICT By J -� Presidentofthe Board of Directors NORTH GATEWAY NUMBER 1 PUBLIC IMPROVEMENT CORPORATION By Presi ent of the Corporation W.L. Enterprises, Ltd., a New Mexico limited partnership ( "WL ") hereby consents to the foregoing Amendment. W. L. ENTERPRISE , LTD. By / �, , 'A� Wayne Lo elady, General Part -3- EXHIBIT F - PIF QUALIFIED COSTS (PHASE 1 AND PHASE 2) Item 1. Earthwork 2. Elizabeth Street 3. Wills Boulevard 4. Relocate Power Line 5. Monument Signage 6. Landscaping 7. Hard Cost Contingency 8. Engineering 9. Geotechnical 10. Legal Description/Survey 11. Legal 12. Deferred Cost Factor 13. Soft Cost Contingency 14. CM Fee (2% of Hard Costs) Total PIF Qualified Costs Interest (LIBOR + 3 %)* PIF Qualified Costs $1,390,106.52 2,723,069.59 363,771.40 200,639.49 204,429.86 1,011,069.01 142,410.04 344,113.94 79,236.91 257,364.10 40,000.00 178,007.19 8,757.50 120,709.92 $7,063,685.47 $304,349.79 *interest continues to accrue on (a) the balance of unpaid principal and (b) any unpaid accrued interest at LIBOR + 3% EXHIBIT G - BID QUALIFIED COSTS (PHASE 1 AND PHASE 2) Item 1. Earthwork Flyover (West) 2. Earthwork Flyover (East) 3. Earthwork 4. Public Improvements (Elizabeth Street) 5. Hard Cost Contingency 6. Legal Fees 7. Deferred Cost Factor 8. Plat 9. Geotech Testing 10. Soft Cost Contingency 11. CM Fee (2 %of Hard Costs) Total BID Qualified Costs Interest (LIBOR + 3 %)* BID Qualified Costs $ 483,996.74 483,996.74 268,350.00 1,558,000.00 91,318.00 279,480.16 115,273.37 103,000.00 45,448.00 13,966.00 57,713.23 $3,500,542.24 $57,638.55 *interest continues to accrue on (a) the balance of unpaid principal and (b) any unpaid accrued interest at LIBOR + 3 %, modified to LIBOR + 2.5% as provided in paragraph 2(a) of the Amendment