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Home My WebLink AboutStudy Session Packet 09-10-12SPECIAL STUDY SESSION AGENDA CITY COUNCIL MEETING CITY OF WHEAT RIDGE, COLORADO 7500 W. 29th Ave. Wheat Ridge CO September 10, 2012 Upon adjournment from City Council Meeting Individuals with disabilities are encouraged to participate in all public meetings sponsored by the City of Wheat Ridge. Call Heather Geyer, Public Information Officer at 303-235-2826 at least one week in advance of a meeting if you are interested in participating and need inclusion assistance. PUBLIC COMMENT ON AGENDA ITEMS APPROVAL OF AGENDA .L Martensen Elementary School Acquisition 2. Resolution 42-2012-Authorizing the execution of an agreement allowing Walrus 5560 LLC. To participate in the Wheat Ridge Business Development Zone Program for the rebate of eligible city fees, charges and taxes in an amount not to exceed $25,500 in association with the demolition and remodel of a facility at 5560 W. 291h Ave. ~\.·~ .... r City of .. ~Wheat&_dge ~ARKS AND RECREATION Memorandum TO: Mayor and City Council Patrick Goff, City Manage~ THROUGH: FROM: Joyce Manwaring, Parks and Recreation Director DATE: September 1 0, 2012 SUBJECT: Martensen Elementary School Acquisition BACKGROUND: Jeffco School District closed Martensen Elementary School at the end of the school year in May 2011. Investigation of the acquisition ofthis site to replace the future park site located at 44th and Kendall was added to the City Council Strategic Plan as a High Priority. Since the initial concept for acquiring this site for development of a neighborhood park was proposed, additional uses for the building and site have developed. These uses include a satellite recreation center and a Boys and Girls Club. PRIOR ACTION: 1) Staff met with the school district to determine a contract price for the site. The negotiated purchase price for the site is $1 ,400 ,000 over a 1 0-year period with 2.5% interest. The total purchase price including interest is $1 ,583 ,734. The annual payment total is $158 ,373. 2) A local grant through Jefferson County Open Space has been awarded for acquisition in the amount of$256,000 as well as a grant of$150,000 from Jefferson County Conservation Trust Funds for a total of $406 ,000. 3) Staff received direction at the June 4 , 2012 , study session to contract with an architect to develop a concept plan, program plan, and estimated costs for renovation of the building for use as a satellite recreation center to replace the Anderson Building. The information presented below is based on the following assumptions: • Facility operating costs listed reflect the savings that will occur with the closure of the Anderson Building and net revenue gain from programs and rentals. • Additional grants to offset the cost of acquisition , facility renovation , and park site development are not included in the costs. There is an opportunity to apply for additional grants to support the project. • The potential proceeds from the sale of 44 111 and Kendall are not included in the costs. City purchased the total site property in 1998 for approximately $400,000. Martensen Elementary School Acquisition September I 0, 2012 Page2 SITE PLAN CONCEPT OPTIONS: Option #1 Satellite Recreation Center and Neighborhood Park only, no Boys and Girls Club A . All programs move from Anderson Building to Martensen . B. Anderson Building is closed and demolished or sold to be moved offsite or recycled. C. 44th and Kendall site is sold and proceeds from sale are used at the Martensen site. Development Costs Acquisition Facility Renovation -Satellite Recreation Center Park Site Development Total Onetime Expenses Demolition of Anderson Building Site Rehabilitation -irrigation and sod Total Annual Operating Costs Pros Annual Facility Operating Costs with Revenue Offset Annual Park Maintenance Costs Total $1 ,600 ,000 3,847 ,877 175,000 $5 ,622 ,877 $50 ,000 20,000 $70,000 $65 ,000 35.000 $100,000 • Opportunity to revitali ze an east Wheat Ridge neighborhood per Neighborhood Revitalization Strategy adopted by City Council • Meets recommendations of Master Plan Cons o Replacement of Anderson Building o Neighborhood park in an underserved area o Uses infrastructure and facility already in place o Allows 44th and Kendall to be sold for possible commercial development ; parcel has 44th frontage and commercial zoning • Increased expense to general fund budget over current operation of Anderson Building • Acquisition costs • Construction phasing required due to funding limitations o Phasing construction will impact programming and successful usage of building • Does not provide for a Boys & Girls Club at this site Martensen Elementary School Acquisition September 1 0, 2012 Page 3 Option #2 Satellite Recreation Center with Boys and Girls Club and Neighborhood Park A. All programs move from Anderson Building to Martensen B. Anderson Building is closed and demolished or sold C. 44th and Kendall site is sold and proceeds from sale are used at the Martensen site D. City subsidizes renovation, maintenance and operating costs (utilities) to house a Boys and Girls Club; or E. City requests reimbursement from Boys and Girls Club operating budget for maintenance and operating costs for that section of center Development Costs Acquisition Facility Renovation -Satellite Recreation Center With Boys and Girls Club Park Site Development Total Onetime Expenses Demolition of Anderson Building Site Rehabilitation-irrigation and sod Total Annual Operating Costs Pros Annual Facility Operating Costs with Revenue Offset Annual Park Maintenance Costs Total • Includes those listed in Option #1 $1,600,000 4,669,368 175,000 $6,444,368 $50,000 20.000 $70,000 $ 65,000 35,000 $100,000 • Provides location for Boys and Girls Club which offers a service to the community not current} y offered Cons • Includes those listed in Option #1 • Community fund raising required to open Boys and Girls Club • Additional renovation cost to include Club in facility Martensen Elementary School Acquisition September 1 0, 2012 Page4 Option #3 Neighborhood Park only, no satellite Recreation Center or Boys and Girls Club A. Anderson Building remains open and operating as it is currently. B. 44th and Kendall site is sold and proceeds from sale are used at the Martensen site. Development Costs Acquisition Building Demolition Park Site bnprovements Total Annual Operating Costs Pros Annual Park Maintenance Costs Total $1,600,000 83,950 700,000 $2 ,383 ,950 $40,000 $40 ,000 • Meets Master Plan recommendation to provide a neighborhood park in underserved area • Provides approximately 2 acre larger site for park amenities when compared to 44th and Kendall • Provides better access to a neighborhood park in comparison to the 44th and Kendall location Cons • Negotiated acquisition cost too high if the building is not going to be used • Increased cost of developing a park at the site may outweigh the benefits of using the existing site • Does not take advantage of the opportunity to replace the Anderson Building • Does not provide for a Boys & Girls Club at this site Option #4 Development of the 44 111 and Kendall site as a neighborhood park A. Do not acquire Martensen B. Anderson Building remains open and operating as it is currently Development Costs Park Site Improvements Total Annual Operating Costs Annual Park Maintenance Costs Total $700,000 $700,000 $35,000 $35 ,000 Martensen Elementary School Acquisition September 10 ,2012 Page 5 Pros • Meets Master Plan recommendation to provide a neighborhood park in underserved area • Least expensive option for park development, although smaller in size Cons • Site has commercial property frontage • Smaller in size for a neighborhood park • Does not take advantage of the opportunity to replace the Anderson Building • Does not provide the opportunity for a Boys & Girls Club at the Martensen site Other Options Other possible options include: A. Replacing the Anderson Building (8 ,000 sq ft) at the current location with a similar size building at an approximate cost of $2 million; or B. Constructing an addition to the Recreation Center to replace the program spaces currently at the Anderson Building. A concept plan and budget were developed for the Recreation Center addition in 2008 for information related to possible placement on the ballot. The estimated budget for this addition was approximately $8 million. ASSUMPTIONS: • All recreation programming is fee based. All fees reflect the direct cost of the program plus an overhead percentage to support cost recovery for supervision, building and advertising. • Park maintenance costs will be required at both the Martensen site and the current site at 441h and Kendall at a cost of $35 ,000 to $40,000 annually. • The proceeds from the sale of 44th and Kendall are not included in the costs; however, the funds can be transferred to support this acquisition. The City purchased the site with Open Space funds for approximately $400,000. • All acquisition, facility renovation and park site development costs are funded from the Open Space Fund and Conservation Trust Fund over a period of several years. • All annual operating costs are funded through the general fund . FINANCIAL IMPACT: Fund 32 Open Space and Conservation Trust Funds: • $160,000 annually is available for acquisition over a 1 0-year period • $1 ,450 ,000 is available for site development through 2018 without impacting other planned projects Martensen Elementary School Acquisition September l 0, 2012 Page6 CITY COUNCIL DIRECTIO N RE Q UESTED: Preferred Option: If Option #1 - • Additional resources in the amount of $2 ,236 ,877 required to fund project • Approval to contract with school district to purchase Martensen • Approval to contract with architectural firm to complete design development If Option #2 - • What level of subsidy or support for Boys and Girls Club: A. Renovation, maintenance and operating costs ; or B. Combination of each item ; or C. No financial support other than providing the building space • Additional resources in the amount of $2 ,652 ,368 required to fund project with 100% support for Boys and Girls Club section of facility renovation • Approval to contract with school district to purchase Martensen • Approval to contract with architectural firm to complete design development If Option #3 - • No additional financial resources required • Approval to contract with school district to purchase Martensen • Approval to contract with architectural firm to complete design development If Option #4 - • No additional direction needed at this time • No additional financial resources required • Approval to contract with architectural finn to complete design development ATTACHMENTS: 1. Martensen Conceptual Plans and Budget JM/dr • j ~ =ryjr ~tyof \VlieatR!_dge Existing Site Plan ensen Ee 0 ~ 60' 120' <J [) BARKER RINKER SEACAT ARCHITECTURE September 10, 2012 .. . .; :,-q ~tyof Wlieat.Ri_dge Demolition Plan Option 1 -Satellite Recreation Center 0 ~ 40 ' 80 ' <J [) BARKER RINKER SEACAT ARCHITECTURE September 10, 2012 ~ \V"J5ityof .c1.eat~e Floor Plan Option 1 -Satellite Recreation Center ensen Ele 0 ~ 40 ' 80' (] [) BARKER RINKER SEACAT ARCHITECTURE September 10, 2012 It X X X X X X X X X Martensen Elementary Remodel -Satellite Recreation Center FACIUTY PROGRAM Date : 9//512012 Revised : Net Progrwn Space Area Ext Facility Adminis tration Spac e s 1,033 Reception 555 Office 256 Office 115 Office -Pre School 107 Require d Building Support Spac es 4,453 Pre-Control Lobby I C irculati on 2,710 M en's Restroo m 200 Wo me n's Restroom 200 Men's Outdoor Toilets 200 Women 's Outdoor Toilets 200 Building Mechanical Room 943 General Bu ild ing Storage 0 Pre-School Room 1.105 Classroom 1,025 Toilet 80 Child Watch 990 Child Watch 910 Toilet 80 Multi Purpose Room 880 Computer Classroom 880 Storage 0 Auxiliary Gym 2.704 Reuse Existing Gym 2.350 Storage 354 New Gymnasium 6,791 Gymnasium 6,070 Storage 721 Aerobics/ Dance Studio 3,095 Aerobics/ Dance Studio 2,525 Storage 570 Aerobics/ Dance Studio (Second Floor) 2,500 Aerobics/ Dance Studio 2,300 Storage 200 Grossing Facmr 1-:Ga lndexllntlation Modfier II% ~c;;OSt+ Grossing Indexed Net Gross Area Factor $/SF 1,033 $80,000 $ 77 $ $ 77 s $ 77 $ $ 77 $ $ 77 $ 4,453 s 386 ,000 s 86.50 $ $ 70.47 $ $ 228 .19 $ $ 228.19 s s 257 .27 $ $ 257 .27 $ $ -s $ 56 .49 s 1,105 $ 124,000 s 111.98 s $ 102 .91 $ $ 228 .19 $ 990 $ 112,000 $ 113.03 s $ 102 .91 $ s 228.19 $ 880 s 81,000 $ 91.16 $ $ 91 .16 $ $ 57 .05 s 2,704 s 71,000 $ 26.07 s $ 30 .00 $ $ -$ 6,791 s 1,257,000 $ 1114.97 s $ 200 .23 $ $ 56 .49 $ 3,095 s 277,000 s 89.34 s $ 96 .76 $ $ 56 .49 $ 2,500 $ 234,000 s 93.54 s $ 96 .76 $ $ 56 .49 $ Program Summary -Satellite Recreation Center i ~ ~of \VlieatRi_dge Coat 79,72U9 42,836.27 19,75&.7 1 8,175.98 8,258.52 385 ,162.17 190 ,97&.26 45,631.33 45,638.33 51,454.98 51,454.98 . . 123,738.03 105,482.70 18,255.33 111,903.39 93 ,648 .06 18,255 .33 80,225.02 80,225 .02 70,500.00 70,500 .00 - 1,256.106.01 1,215.377.72 40,728 .29 276,511 .77 244 ,313 .26 32 ,198.51 233,840.49 222,542 .77 11 ,297.72 S1111SF T oal flnltrlll'l Alii 23,551 SF Tcltll Progrlm Colt $2,122,0110 llllctedProgriM Sllactld GraaAIM ....,_c• Notes t.aa• -- ..... ..... =---r-... ~ -~ -.=.....;;j· t.•• ~ .. ,,.. -· .... J,JM. "~ ..,... $1 ~- .... pr7,11D ,.... S23UIO 23,551 SF S 2,122.000 BARKER RINKER SEACAT ARCHITECTURE September 10, 2012 Martensen Elementary Remodel -Satellite Recreation Center Additfon and Renovation Conceptual Budget 8/512012 U Site Costs Deecrllltian Qua__ll!lly_ Unitl Unit Price Toal 1.1 Remow elCistlng P8Ying lor new 8ddlion 8,300 sf $ 2 $ 18,100 1.2 Demobh Existing Building -Wist Side 7,000 sf $ 8 $ 42,000 1.3 Oemobh Existing Building -Eas1 Side 8,.200 sr $ 8 $ 55,200 1.o4 Add 13 p..ting SIAIIIS 1,700 Sial $ 13 $ 22,100 1.5 Landsc:llping Ill bulding 1 ellow $ 4 ' 20,000 1.8 Belie Lendsceping on Eas1 Side 11,1100 sf $ 8 $ 111 ,1100 1.7 Belie Lendsceping on Wtst Side 7,300 sf $ 8 ' 43,100 1.8 Sidewds 3,000 sf $ 5 • 13,500 u Mile. 1 IS ' 15,000 • 15,000 Sub Total Sle 33t.IIOo I z.o Building 2.11 Add Gym. Remodel Rec:rellllon Center ~ces ~ Minor Enlly Renowtion end SQnege-Rec Center I 1j_ eltow l $ 10,000 Js to,OOO I Sub TOial Building 2.102.ooo I Sub TOial SMe +Building 3,041 ,1100 I 2.101 Conllngency -1011. 304,1to 1 Slbotel ,, 3,345,tll01 lt....U Assumes slvub& end irriplion Ill ntnoveliollereas Assumn aras end nlglllion Assumes aras end inlglllion J J J 3.Dj_ Soft Colts -15% 501 ,at7l Design, Engineering, ReviewS , Printing, Testing , FF&E I Toe.! ProjKt Coat Notea: ln11eted to assume e ,.point of conscruclion or Jenuery 2014 Nurmers coukl be +/-1011. I' U47,177l 1 or1 Conceptual Budget -Satellite Recreation Center Martensen Ele BARKER RINKER SEACAT ARCHITECTURE September 10, 2012 Floor Plan Option 2 -Satellite Recreation Center with Boys and Girls Club 0 ~ 40' so · (] [) BARKER RINKER SEACAT ARCHITECTURE September 10, 2012 ~ ~ A~ ~of \V'heat.Ri_dge Floor Plan Option 2 -Satellite Recreation Center with Boys and Girls Club ensen le 0 ~ 40' 80' (] [) BARKER RINKER SEACAT ARCHITECTURE September 10, 2012 .. X X X X X Martensen Elementary Remodel -Boys and Girls Club FACIUTY PROGRAM Date : 9//5/2012 Revised: Net Program Space Area Fa cility Adm i nistration Spaces 400 Rece pt ion Office Req uired Building Support Spaces 5,021 Pre-Control Lobby I Circulation Men's Restroom W>men's Restro om Building Mecha nical Room General Build ing Storage Kitchen ·Residential 100 Kitchen Teen Room/Tech/Education 2,424 Classrooms (3 «!l 808 SF) Art and Crafts 1,038 Classroom Grossing Facta- lndeJAnflation t.blier Net Cost+ Grossing Ext Gross Area Factor .&00 $31 ,000 300 100 5,021 $ 314,000 4,2 46 204 204 107 260 180 $ 38 ,000 100 2,424 $ 221 ,000 2,424 1,038 s 107 ,000 1,038 Ave.COitiSF 1.00 Totll Protlr• ANI 1 ,113 NET SF 0% T oCII Program Colt 1711,100 Indexed Net lellctld Progrant ....... $/SF Cost OroaAIH ......... Coet Notes s n $ 30,872.99 •• $31,100 s n $ 23,154.74 $ 77 $ 7,71 l25 $ 62.52 $ 31 3,906.67 Ult. m(ioc s 70 .4 7 $ 299,219.63 s $ . $ . $ . <1: $ $ . $ 56 .4 9 $ 14,687.04 $ 205.82 s 37,047.58 •• •• s 2ai.82 $ 37 ,047.58 $ 91.16 $ 220 ,983.~ J..tM• $221 .... $ 91 .16 $ 220,963 .46 s 102.91 s 106,&20.53 .... 00,"" $ 102.91 $ 106,820 .53 t,OI3Sf $ 711,001 ~ Program Summary -Satellite Recreation Center with Boys and Girls Club ~ityof \VlieatRi_.dge ensen Ele BARKER RINKER SEACAT ARCHITECTURE September 10, 2012 "'' " f/ Martensen Elementary Remodel -Satellite Recreation Center with Boys and Girls Club Addition and Renovation Conceptual Budget 1.0 Site Costs DescrfptiOn 1.1 Remow existing Pilling for new eddilion 1.2 Demolish Existing Building -Wtst Side 1.3 Demolish Existing Building -East Side 1.4 Add 13 parting stills 1.5 LlndSCiping 81 building Ul Blsk: Llndscaptng on West Side 1.7 Sidewlllks 1.11 Misc. 2.0 Building Desc-n 2 .1 Add Gym. Remodel Recreation Center Spaces 2 .2 ..,or Entry Renovation lnd Slgnsge -Rec Center 2.2 Minor Entry Reno\lllllon 1nd Slgnsge -Boys lnd Girls Club 2 .10 Contingency -10% 3.of_ Sol Costs -15% Total Project CMt Notas : lnlllted to assume a mid-point of construction of Janusry 2014 Numbers could be +/-10% Quanllty Unlb 11.300 sf 7 .000 sf 9,200 sf 1,700 IIIII 1 a low 7.300 sf 3 ,000 sf 1 Is Sub TOilll Sle Cuanlltv Unlb 32.800 sf 1 a low 1 I low Sub Tollll Building Sub Total Site + Building Subtotal 81512012 Un•Prtc. Total R-'ll s 2 s 18.1100 s II s 42.000 s II s 55.200 s 13 s 22.100 s 4 s 20.000 Assumes shrubs 1nd ln1g8lion 81 renovatiOn 1rus s e s 43 .1100 Assumes grass 1nd ~ion s 5 s 13.500 s 15.000 s 15,000 Is 2211 .200 I Un. Pike Total Remarb s 102 s 3.333.000 See Program Summary s 80,000 $ 80,000 $ 50,000 s 50,000 Is 3 .443.0001 Is 3.1111.2001 $ 3111 ,120 Is 4 .0110.3201 Is 1101 ,0411 Design. Englneemg, Reviews , Prlnllng. Testing , FF&E " 1 of 1 Conceptual Budget -Satellite Recreation Center with Boys and Girls Club ~of W'lieatRL_dge ensen Elem BARKER RINKER SEACAT ARCHITECTURE September 10, 2012 'A~ ...... ~ City of .. ~WheatN._,dge ~OFFICE OF THE 01Y MANAGER Memorandum TO: Mayor and City Council Patrick Goff, City Manager~ THROUGH: FROM: Steve Art, Economic Development Manager DATE: September 10,2012 SUBJECT: Business Development Zone and Enhanced Sales Tax Incentive Programs ISSUES: New and existing businesses are opening or expanding in the City of Wheat Ridge and inquiring into the use of two existing economic development incentive programs-the Business Development Zone (BDZ) Program and Enhanced Sales Tax Incentive Program (ESTIP). Staff is seeking guidance from Council on the following: 1. Approval ofthe BDZ request from Walrus 5560 LLC and direction on the amount and type(s) of incentives to be offered. 2. Direction on future use of the ESTIP and the BDZ Program. 3. Direction on amendments to portions of Chapter 22, Divisions 4 and 5 of the Wheat Ridge Code of Laws relating to the ESTIP and BDZ Program. BACKGROUND: Chapter 22 of the Wheat Ridge Code of Laws established the ESTIP and the BDZ Program. The primary purpose of the ESTIP is to encourage the establishment and/or substantial expansion of retail sales tax generating businesses within the city. While the primary purpose of the BDZ Program is to provide incentives for new development or revitalization to overcome conditions ofunemployment, underemployment, net outmigration of the population, diminution oftax revenues, chronic economic distress and deterioration ofbusiness districts and public infrastructure. The ESTIP provides incentives through the rebate of future sales tax increment while the BDZ provides incentives through the rebate of use tax on furniture and fixtures associated with the initial development or redevelopment project, use tax on building materials, building permit fees and zoning fees. In the past the Council has approved several ESTIP and BDZ agreements with existing Wheat Ridge businesses and non-profits as well as an existing business in a neighboring community looking for an incentive to relocate to Wheat Ridge. Every project was unique but each was evaluated for incentives against a set of criteria outlined in the Code of Laws. Study Session Memo September 10,2012 Page2 The criteria for approval of both an ESTIP and a BDZ agreement are as follows: 1. The amount of enhanced sales tax (and use tax for a BDZ agreement) which can reasonably be anticipated to be derived by the city through the expanded or new tax generating business; 2. The public benefits which are provided by the applicant through public works, public improvements, additional employment for city residents; 3. The amount of city expenditures which may be deferred by the city based upon public improvements to be completed by the applicant; and 4. The conformance of the applicant's property or project with the comprehensive plan and zoning ordinances of the city. On May 14,2012 , City Council adopted Resolution 24-2012 which established the entire incorporated City of Wheat Ridge as a Business Development Zone. The Resolution also stipulated that the BDZ Program would be used as an economic development incentive to target businesses that will enhance the City's sales and use tax base and create jobs to include, but not limited to , the following: a. Niche and Specialty retail -gardening, landscaping, and produce retailers ; outdoor lifestyle and recreation retailers; full service, sit-down restaurants ; furniture, hardware and clothing stores b. Primary employers -medical-related facilities and supporting services to complement Exempla Lutheran hospital , and clean energy and biotechnology companies to locate in the Clear Creek Crossing or TOD area . Most recently, staff received a BDZ request from Walrus 5560 LLC, a development company renovating a parcel at 5560 West 29th A venue for a new restaurant. This development is new to the City and is anticipated to generate fees and taxes associated with the redevelopment and new annual incremental property, sales and use tax. When Walrus purchased the 29th Avenue site, it included two older structures zoned for commercial use that had been leased as residential units for a number of years. Recently, one of the structures was left vacant, leading to a blighting factor in the neighborhood . The other structure was in need of major repairs and was showing its age. Earlier this year Walrus demolished one of the structures to make room for a parking lot and patio seating area . Walrus also began renovations on the remaining structure by adding additional square footage . Upon completion the site will accommodate a full-service, sit-down restaurant and bar with interior seating for about 1 00. The project will include exterior patio seating. The project will have an on-site parking lot for 16 vehicles and provide required accessible spaces . After construction the facility will be leased to an un -named restaurant that exp ects to have an initial staff of approximately 2 5 p ersons. New public improvements being constructed at the expense of Walrus include two new curb cuts, curb and gutter, and sidewalks adjacent to the property. Study Session Memo September 1 0, 2012 Page 3 Earlier this year Walrus approached staff with a desire to enter into a BDZ Agreement wherein Walrus would receive a 100% rebate of their use tax, building permit and zoning fees in an amount not to exceed $25,500. Staff drafted an agreement that was presented at a regularly scheduled City Council meeting on August 25, 2012. At that time Council reviewed the request and opted to continue the item to a future study session to further review the request and examine other options for the request by Walrus. Walrus estimates that total building construction improvements, furniture, fixtures and equipment will total $850,000. To date, Walrus has paid to the City $6,314.23 in use taxes and $6,079.15 in permit and zoning fees. Annual new sales tax to the City is estimated at $45,000. At that August 25,2012 meeting, some members of Council questioned if it was in the best interest to provide a 100% BDZ incentive to an unproven new business. Council recognized this was the first BDZ Agreement it has received of this type and wished to discuss this item and provide direction to staff for future applications of the programs. Additionally, while reviewing the City's BDZ and ESTIP programs in the Code of Laws, staff has recognized some discrepancies in both sections and is requesting that they work with the City's legal counsel to amend both sections. These identified changes include: • Removing Sections 22-81 and 22-92 regarding the availability of a 1% Capital Improvement Fund. This fund no longer exists and thereby is unavailable for these programs; and • Removing Section 22-96 which limits the use of both BDZ and ESTIP under certain conditions ; and COUNCIL CONSIDERATIONS: Staff would like direction on the following: 1. The proposed BDZ Agreement with Walrus 5560. Following are options to consider: a. Moving forward with the BDZ agreement as presented on August 25, 2012 with the original request of a 100% rebate ofuse-tax and permit and zoning fees for an amount not to exceed $25 ,500; or b. Providing for a new BDZ Agreement with a __ % rebate of use-tax and permit and zoning fees for an amount not to exceed $ ; or c. Creating an ESTIP Agreement which would rebate future incremental sales tax at 50% per year for 3 years for a not-to-exceed amount of $25 ,500 or whichever occurs first. The base year for sales tax generation would be based upon the previous 12-months of sales tax generation on the site, which would be zero dollars. d. Creating an ESTIP Agreement which would rebate future incremental sales tax at __ %per year for __ years for a not-to-exceed amount of$ or whichever occurs first. The base year for sales tax generation would be based upon the previous 12-months of sales tax generation on the site, which would be zero dollars. e. Create an agreement using both the BDZ Program and the ESTIP. Study Session Memo September 10, 2012 Page4 f. Directing staff to inform Walrus 5560 that it believes Council will not support any type of agreement at this time. 2. The future use of the BDZ Program and the ESTIP. a. Should there be a percentage or dollar cap on the amount of rebates provided? b. Should new start-up businesses be treated differently than established businesses? c. Should every project be judged on its own merits against the criteria established in the current code? d. Should additional criteria be added to the Code of Laws? e. Does City Council want to study session every application before approval? 3. Authorization to proceed forward with amending the Code of Laws as they pertain to the BDZ Program and ESTIP for future Council consideration. Attachments: 1. BDZ request letter from Walrus 5560 LLC , dated July 17, 2012 2. Original proposed BDZ Agreement with Walrus 5560 LLC 3. Chapter 22, Division 4 -Enhanced Sales Tax Incentive Program 4. Chapter 22, Division 5 -Business Development Zone Mr. Steve Art WALRUS 5560 LLC 730 Kalamath Street Denver, CO 80204 (303) 595-8900 wstarker@starker.net July 17, 2012 Economic Development & Urban Renewal Manager City of Wheat Ridge 7500 West 29th Avenue Wheat Ridge, CO 80033 Re: a Restaurant 5560 West 29th Avenue Wheat Ridge, CO 80214 Dear Steve, We greatly appreciate the interest the City of Wheat Ridge has shown in our plan to develop a restaurant property at 29th & Depew Streets. To recap the project: a full-service sit-down restaurant and bar with interior seating for about 100 as well as exterior patio seating. We will have an on-site parking lot for 16 cars. We expect to have an initial staff of approximately 25 persons, hopefully filled with many Wheat Ridge residents. New public improvements being constructed at our expense include two new curb cuts, curb and gutter and sidewalks adjacent to the property. As we are included in the new city-wide business development zone, we are requesting the abatement of use taxes, permit and zoning fees, and any other assistance available from the city based on the following criteria: • The incremental future sales and use tax revenue expected from the development of this property is significant; • The project will generate many permanent good paying job opportunities for our citizens, as well as good construction-related jobs during construction and the economic activity they bring to the surrounding neighborhood; • The project will construct improvements in the public right-of-way which will defer improvements being made by the city; and • The project is in conformance with the best aspects of the comprehensive plan. I currently estimate that we will invest about $850,000 in building construction improvements, furniture, fixtures and equipment. We have paid to date $6,314.23 in use taxes and $6,079.15 in permit and zoning fees. Attachment 1 Once again, thank you for your help with this project. We are very excited to bring this restaurant to Wheat Ridge and hope this project becomes a catalyst for development on the eastern edge of the city. Please feel free to contact me if you have any questions. Sincerely yours, William J. (Bud) Starker AGREEMENT TO PARTICIPATE IN THE CITY OF WHEAT RIDGE BUSINESS DEVELOPMENT ZONE PROGRAM This Agreement to Participate in the City of Wheat Ridge Business Development Zone Program (this "Agreement") is made and entered into as of the 27th day of August, 2012, by and between WALRUS 5560 LLC located at 730 Kalamath Street, Denver, CO 80204hereinafter referred to as the "Owner" and the CITY OF WHEAT RIDGE, COLORADO , 7500 W. 29th Avenue, Wheat Ridge, Colorado 80033 hereinafter referred to as the "City," collectively the "Parties," and each individually, as a "Party." WHEREAS, the City has adopted as a portion of the Wheat Ridge Code of Laws ("Code") Chapter 22, Article I, Division 5, "Business Development Zone" (the "Program"), to encourage, in part, continued development and expansion of opportunities for employment in the private sector in the City; and WHEREAS, Owner has applied to participate in the Program and a public hearing was posted and conducted; and WHEREAS, Owner is the owner and operator of leasable space and improvements thereon within the City and known as the "Owner," and is the operator of a commercial development serving residents of Wheat Ridge and surrounding communities; and WHEREAS, pursuant to Code Sec. 22-86 (b), the City Council has designated the real property leased by Owner as a "Wheat Ridge Business Development Zone"; and WHEREAS, Owner plans to construct tenant improvements totaling approximately $850,000; and WHEREAS, the project creates neighborhood services and brings revenue to the City from surrounding communities -a true definition of economic development; and WHEREAS; the project will create up to 25 jobs and construction related jobs prior to the opening of the facility, and WHEREAS; the project creates new revenue through permit fees, and use tax on furniture, fixtures and equipment; WHEREAS; the project spurs reinvestment and remodeling of a blighted facility, thus enhancing and preserving its economic viability in the City; and WHEREAS; the project should lead to the revitalization of the 29 111 A venue conunercial corridor and aid the existing commercial establishments; WHEREAS, the Program allows the City to provide for the sharing of certain categories of fees, taxes and other business development-related charges for new development within the business development district ("Eligible City Fees, Charges and Taxes" as defined in Code Sec. 22-87 (1)) to the extent allowed by an agreement with a business owner; and 1 Attachment 2 WHEREAS, cost-sharing at the rate prescribed herein will serve to aid the expansion of Owner in that it will alleviate a portion of the costs associated with the expansion . NOW , THEREFORE, in consideration ofthe foregoing , and the covenants, promises, and agreements of each of the Parties hereto , to be kept and performed by each of them , the Parties agree as follows: 1. Recitals. The Recitals set forth above are incorporated in this Agreement by reference. 2. Term. The tenn of this Agreement shall commence on August 27, 2012 and shall terminate upon full refund by the City to Owner of eligible City fees , charges and taxes as set forth in Paragraph 7 (the "Term"). Notwithstanding the foregoing , it is an express provision of this Agreement that this Agreement shall expire and be of no further force and effect upon the occurrence of the earlier to occur of: (1) expiration of the Term or (2) payment of the maximum amount to be shared as set forth in Paragraph 7 (whether or not the Tenn has expired), or (3) detennination by the City of Owner's default, as provided in Paragraphs 13 or 15. 3. The Project. The project proposed by the Owner through which it desires to participate in the Program consists of the following , generally: lease space property upon which to demolish a blighted structure and construct tenant improvements in the amount of approximately $850 ,000 that include interior and exterior improvements to the Owner site, the addition of a paved 16 stall parking lot , the creation of an outdoor patio area , and development of a restaurant with a full licensed commercial kitchen. The foregoing shall be collectively referred to herein as the "Project," and is more fully described below at Paragraphs 4 and 8. 4 . Representations of Owner. Pursuant to Code Sec. 22-94 , Owner hereby represents to the City the following: a. Improvements justifying Project approval. 1. Revitalization of land. The project will invest an estimated $850 ,000 into an interior and exterior remodel of the building with plans subject to approval by the City of Wheat Ridge Community Development Department and attached as Scope of Development and attached as Exhibit A which shall also be used as the application for inclusion in the program. Estimated cost. The cost for the initial phase of the Project including the improvements described above is estimated to be approximately EIGHT HUNDRED AND FIFTY THOUSAND DOLLARS ($850 ,000) b. Expected future tax revenue. Owner operates a Limited Liability Corporation. Any future sales and use tax revenue will be directly generated by this Project. Benefits to the 2 community which may generate future sales and use tax indirectly have been identified by the Owner as follows : 1. Short-term positive impact during construction: Prior to the completion of the Project, the tenant improvement phase will employ additional personnel in the construction phase. 11. Upon completion of the improvements, the project will provide new sales tax production. m. This project should lead to improving the neighborhood and providing more dining options in the community. IV. Creates new revenue through permit fees , use tax on furniture , fixtures and equipment and sales tax ; 5. Personal agreement; non-transferable; no third party beneficiaries The cost-sharing of Eligible City Fees, Charges and Taxes as approved herein shall constitute a personal agreement between the City and Owner. The terms of this Agreement do not run with the land. The obligations, benefits and/or provisions of this Agreement may not be assigned in whole or in any part without the express authorization of the City Council. No third party shall be entitled to rely upon or enforce any provision hereof. 6. Agreement not to constitute debt or obligation of the Citv Nothing herein shall be construed to constitute a debt or obligation of the City. Notwithstand ing any other provision of this Agreement to the contrary, tl1e Parties understand and acknowledge that the City is subject to Article X , § 20 of the Colorado Constitution ("TABOR"). This Agreement does not create a multi-fiscal year direct or indirect debt or obligation within the meaning of TABOR and , therefore, notwithstanding anything in this Agreement to the contrary, all payment obligations of the City are expressly depend ent and conditioned upon the continuing availability of funds beyond the term of the City's current fiscal period ending upon the next succeeding December 31. Financial obligations of the City payable after the current fiscal year are contingent upon funds for that purpose being appropriated , budgeted , and otherwise made available in accordance with ordinances and resolutions of the City and other applicable law. 7. Cost-sharing a. Estimated Eligible City Fees, Charges and Taxes . The following are estimates of the Eligible City Taxes which are the subject of the cost-sharing herein. 1. Use Tax: The project will invest approximately $850,000 in new construction improvements, furniture and fixtures. b. Cost-sharing. Pursuant to Code Sec. 22-88 , cost-sharing of the Eligible City Fees, Charges and Taxes may be granted up to the Expected Use Tax Revenue. It is 3 anticipated that the Use Tax Revenue received from the Project is currently projected to be $25,500 of Use-tax. Notwithstanding the foregoing, and in reliance upon the representation of Owner of the benefits to the City of the Project, the City and Owner agree to the cost-sharing for the Eligible City Fees, Charges and Taxes as follows: 1. 100% of the Eligible City Fees, Charges and Taxes shall be due and paid to the City by Owner for tenant improvements in an amount not to exceed $25,500 based upon review and approval by the City of properly documented requests for the same. Upon receipt thereof, the City shall refund 100% of such Eligible City Fee, Charges and Taxes back to the Owner in 1 equal payment to their overall Tax charge described in Paragraph 2 herein. In no event shall the City be obligated to refund more than $25,500 of use tax on eligible City Use Tax, Charges and Fees received by it. 8. Legalchallenge In the event of legal challenge to the Program as applied to Owner, any costs scheduled to be shared-back to Owner shall be escrowed until resolution of the dispute. 9. Waiver of Code requirements To the extent any requirements of Code Sees. 22-85 through 22-96 have been waived , such waiver has occurred pursuant to Code Sec. 22-93 (c) whereby the City Council has found by a ~ majority vote that such waiver is in the public's interest and will provide a substantial benefit to the City. 10. No joint venture Pursuant to Code Sec. 22-95, nothing herein shall be construed to create a joint venture between the City and Owner. Notwithstanding any provision hereof, the City shall never be a joint venture in any private entity or activity which pmiicipates in the Progran1, and the City shall never be liable or responsible for any debt or obligation of any participant, including the Owner, in the Program. 11. Use of funds Pursuant to Code Sec. 22-89, Owner expressly acknowledges and agrees that any Eligible Use Tax, Fees, and Charges refunded to the Owner under this Agreement, up to the amount agreed upon by the City Council pursuant to this Agreement may only be used for the purpose of the Project, as described in Paragraph 12, on Owner's Property within the underlying Business Development Zone. 12. Uses enumerated Pursuant to Code Sec. 22-90, the uses to which the Eligibl e Use Tax, Fees, and Charges may be put by the Owner shall be strictly limited to those which are approved by the City Council and which relate directly to the Project within the City, which Project is anticipated to 4 indirectly generate more municipal sales and use tax revenues for the City in the future. Uses hereby expressly approved by City Council are as follows : -Demolition of one structure and the interior and exterior improvements to the site at 5560 W. 29 th Avenue located at the southeast comer of 29 1h Avenue and Depew Streets in Wheat Ridge; 13. No covenant to construct or to operate. The intent of this Agreement is to provide for Owner's participation in the Program, in the event that Owner completes the Project. Notwithstanding any provision in this Agreement to the contrary, Owner shall have no obligation under this Agreement to complete the Project. In the event Owner fails to complete the Project, this Agreement may be tenninated at the option of the City. 14. Remedies The Owner waives any constitutional claims against the City arising out of a breach of this Agreement. The Owner's remedies against the City under this Agreement are limited to breach of contract claims . In no event shall the City be liable for any form of damages , including without limitation: exemplary, punitive or consequential damages , including economic damages and lost profits. 15. Termination In the event Owner fails to comply with one or more of the tenns of this Agreement, City may, in its sole discretion , tenninate this Agreement. 16. Indemnification To the fullest extent pennitted by law , Owner agrees to indemnify and hold the City hannless from any damage , liability or cost (including reasonable attorneys ' fees and cost of defense) to the extent caused by the Owner's negligent acts , errors or omissions in the perfonnance this Agreement and those of its sub-contractors, sub-consultants or anyone for whom the Owner is legally liable. To the extent permitted by the Colorado Constitution and statutes, the City agrees to indemnify and hold the Owner harmless from any damage, liability or cost (including reasonable attorneys ' fees and costs of defense) to the extent caused by the City's negligent acts , errors or omissions arising from this Agreement. These defense and indemnification obligations shall survi ve the expiration or termination of this Agreement. The Parties acknowledge that the pro v isions of this Paragraph are not intended to waive or alter any of the rights and defenses afforded to the City under the common law , the Colorado Governmental Immunity Act, C.R.S. §§ 24-10-101 , et. seq. oranyotherlaw. 17. Severability If any part, term or provision of this Agreement or the Program is held by a court of competent jurisdiction to be illegal or in conflict with any law of the State of Colorado , the 5 validity of the remaining portions or provisions shall not be affected, the rights and obligations of the Parties shall be construed and enforced as if the Agreement did not contain the particular part, term or provision held to be invalid, and the Parties shall cooperate to cure any legal defects in the Agreement or the Program. Should the sharing of Eligible City Fees, Charges and Taxes pursuant to this Agreement be judicially adjudged illegal, invalid or unenforceable under the present or future laws effective during the Term of this Agreement by a court of competent jurisdiction in a final, non-appealable judgment, the Parties shall utilize their best, good faith efforts to restructure this Agreement or enter into a new agreement consistent with the purposes of this Agreement. Should the Parties be unsuccessful in their efforts, the Agreement shall tenninate without penalty or recourse to either Party. 18. G o vernine law ; ven ue The laws of the State of Colorado shall govern the validity, perfonnance and enforcement of this Agreement. Should either Party institute legal suit or action for enforcement of any obligation contained herein, it is agreed that venue of such suit or action shall be proper and exclusive in the district court for Jefferson County Colorado. 19. Notices All notices required or permitted under this Agreement shall be in writing and shall be hand delivered or sent by certified mail , return receipt requested, postage prepaid , to be addressed to the Parties set forth below. All notices so given shall be considered effective upon the earlier of the actual receipt or seventy-two (72) hours after deposit in the United States Mail with the proper address . Either Patiy by notice so given may change the address to which future notices shall be sent: Notice to the City: Copy to: Notice to the Owner: Copy to: 20. City Manager City of Wheat Ridge 7500 W. 291h Ave. Wheat Ridge, CO 8003 3 City Attorney City of Wheat Ridge 7500 W. 29th Ave. Wheat Ridge, CO 80033 Bud Starker Walrus 5560 LLC 730 Kalamath Street Denver, CO 80204 Entire agreement -amendments This Agreement embodies the whole agreement of the Parties. There are no promises, terms, conditions, or obligations other than those contained herein, and this Agreement shall 6 supersede all previous communications, representations or agreements , either verbal or written , between the Parties hereto. This Agreement may be amended only by written agreement between the Owner and the City acting pursuant to City Council authorization . 21. Effective date This Agreement shall be effective and binding upon the Parties upon the date first set forth above. IN WITNESS WHEREOF , Owner and City have each caused this Agreement to be executed by their authorized representatives. State of Colorado County of Jefferson ) ) ) OWNER OWNER,LLC By: ____________________________ __ Name: Bud Starker Title: Owner -Walrus 5560 LLC ss . The foregoing Agreement was acknowledged before me this _ day of ______ , 2010, by ___________________ :,Starker Construction Company. WITNESS MY HAND AND OFFICIAL SEAL. My Commission expires: ______________ _ NOTARY PUBLIC 7 CITY OF WHEAT RIDGE ATTEST: Name: Janelle Shaver Title: City Clerk By: --------------------Name: Jerry DiTullio Title: Mayor Approved as to Form Gerald E . Dahl, City Attorney 8 EXHIBIT A SCOPE OF DEVELOPMENT The project is a full-service sit-down restaurant and bar with interior seating for about 100 as well as exterior patio seating. They will have an on-site parking lot for 16 cars. They expect to have an initial staff of approximately 25 persons. New improvements being constructed include: • two new curb cuts, curb and gutter and sidewalks adjacent to the property. • A 16-stall parking lot with accessible spaces • Demolition of a blighted structure on the site for patio and parking areas • Remodel and addition to remaining commercial structure that will provide for a commercial kitchen, accessible restroom facilities, new fa9ade and general improvements to the facility • Outdoor seating patio After construction the project will provide: • The incremental future sales and use tax revenue expected from the development of this property is significant; • The project will generate many permanent good paying job opportunities, as well as good construction-related jobs during construction and the economic activity they bring to the surrounding neighborhood; • The project will construct improvements in the public right-of-way which will defer improvements being made by the city; and • The project is in conformance with the best aspects of the comprehensive plan. 9 Municode Page 1 of5 Wheat Ridge , Colorado, Code of Ordinances » PART II-CODE OF LAWS » Chapter 22-TAXATION >>ARTICLE I.-SALES AND USE TAX » DIVISION 4. -ENHANCED SALES TAX INCENTIVE PROGRAM >> DIVISION 4. -ENHANCED SALES TAX INCENTIVE PROGRAM Sec. 22-73 . -Program established . Sec. 22 -74.-Puroose . Sec. 22 -75.-Defin itions . Sec. 22-76 .-Participation . Sec. 22-77 .-Approval of agreement: use of funds generally . Sec . 22-78 .-Uses enumerated . Sec . 22-79. -Increments. sharing of funds . Sec. 22-80. -Revenues restricted . Sec . 22-81 .-Capital improvement fund . Sec . 22-82 .-Criteria for approval of application . Sec. 22-83.-Agreement required . Sec. 22-84. -Joint venture: liability _ Sec. 22-73.-Program established. There is hereby established within the city an enhanced sales tax incentive program . (Ord. No . 1988-758 , § 1(24 -1), 5-23-88; Ord. No . 1272, § 1, 12-9-02) Sec. 22-74.-Purpose. The purpose of the enhanced sales tax incentive program created by this division is to encourage the establishment and/or substantial expansion of retail sales tax generating businesses within the city , thereby stimulating the economy of and within the city , thereby providing employment for residents of the city and others, thereby further expanding the goods available for purchase and consumption by residents of the city , and further increasing the sales taxes collected by the city, which increased sales tax collections will enable the city to provide expanded and improved municipal services to and for the benefit of the residents of the city, while at the same time providing public or public-related improvements at no cost, or at deferred cost, to the city and its taxpayers and residents. (Ord. No. 1988-758, § 1(24-2), 5-23-88; Ord. No . 1272, § 1, 12-9-02) Sec. 22-75. -Definitions. The following words, terms and phrases, when used in this division, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning : Enhanced sales tax shall mean the amount of sales tax collected by the city over and above a base amount negotiated by, and agreed upon by , the applicant and the city , and which amount is approved by the city council , which base amount shall never be lower than the amount of sales Attachment 3 http:/ /1 ibrary .municode.com/print.aspx?h=&clientlD= 11707 &HTMRequest=http%3a%2fl>/o... 9/5/2 012 Municode Page 2 of5 taxes collected by the city at the property in question in the previous twelve (12) months plus a reasonable and agreed upon percentage of anticipated increase in sales taxes, or, in the case of a newly established business, an amount which represents the good faith determination by the applicant and the city as to the amount of sales taxes which could be generated from the new business without the participation by applicant in the ESTIP created under this division . ESTIP means the enhanced sales tax incentive program created under this division . Owner or proprietor shall mean the record owner or operator of an individual business, or, in the case of a shopping center, the owner of the real property upon which more than one (1) business is operated , provided that the owner (whether an individual , corporation, partnership or other entity) is the owner or less or of the individual businesses operated thereon . (Ord. No. 1988-758, § 1(24-3), 5-23-88; Ord. No. 1272, § 1, 12-9-02) Sec. 22-76. -Participation. Participation in ESTIP shall be based upon approval by the city council exercising its legislative discretion in good faith . Any owner or proprietor of a newly established or proposed retail sales tax generating business or location, or the owner or proprietor of an existing retail sales tax generating business or location which wishes to expand substantially , may apply to the city for inclusion within the ESTIP provided that the new or expanded business is reasonably likely to generate enhanced sales taxes of at least five thousand dollars ($5,000.00) in the first year of operation . (Ord. No. 1988-758, § 1(24-4), 5-23-88; Ord. No. 1990-854, § 1, 11-26-90; Ord. No. 1272, § 1, 12-9-02) Sec. 22-77.-Approval of agreement; use of funds generally. Approval by the city council of an agreement implementing this ESTIP shall entitle the successful applicant to share in enhanced sales taxes derived from applicant's property or business in an amount which shall not in any event exceed the enhanced sales taxes ; provided, however, that applicant may use such amounts only for public and/or public-related purposes such as those specified herein and which are expressly approved by the city council at the time of consideration of the application. The time period in which the enhanced sales taxes may be shared shall not commence until all public or public-related improvements are completed , and shall be limited by the city council , in its discretion, to a specified time, or until a specified amount is reached . (Ord. No. 1988-758, § 1(24-5), 5-23-88; Ord. No. 2002-1240, § 1, 1-28-02; Ord. No. 1272, § 1, 12-9-02) Sec. 22-78.-Uses enumerated. The uses to which the shared enhanced sales taxes may be put by an applicant shall be strictly limited to those which are public or public-related in nature. For the purposes of this division, public or public-related purposes shall mean public improvements, including but not limited to streets, sidewalks , curbs, gutters, pedestrian malls , street lights , drainage facilities , landscaping , decorative structures, statuaries, fountains , identification signs , traffic safety devices, bicycle paths , off-street parking facilities , benches , restrooms , information booths, public meeting facilities , and all necessary , incidental , and appurtenant structures and improvements, together with the relocation and improvement of existing utility lines, and any other improvements of a similar nature which are specifically approved by the city council upon the city council's finding that said improvement are http :/ /library .munj code.com/print.asp x?h=&cli e ntiD= 11 7 0 7 &HT MRequ est=http%3a%2fO/o... 9/5/201 2 Municode Page 3 of 5 public or public-related improvements , and that such improvements shall enhance the competitive position of the applicant within the Denver metropolitan area marketplace. (Ord. No. 1988-758, § 1(24-6), 5-23-88; Ord. No. 1272, § 1, 12-9-02) Sec. 22-79. -Increments, sharing of funds. The base figure for sales taxes shall be divided into twelve (12) monthly increments, which increments are subject to agreement between the parties , and approval by the city council, and which increments shall be reasonably related to the average monthly performance of the business or property in question , or similar businesses in the area (i.e. adjust for seasonal variations). If in any month the agreed upon figure is not meet by applicant so as to create enhanced sales tax for that month , no funds shall be shared with applicant for that month, and no increment shall be shared until that deficit, and any other cumulative deficit, has been met, so that at the end of any twelve-month cycle, funds in excess of those enhanced sales taxes agreed to be shared shall not have been shared with any applicant. (Ord. No . 1988-758, § 1(24-7), 5-23-88; Ord. No. 1272, § 1, 12-9-02) Sec. 22-80.-Revenues restricted. It is an overriding consideration and determination of the city council that existing sources of city sales tax revenues shall not be used , impaired , or otherwise affected by this enhanced sales tax incentive program . Therefore, it is hereby conclusively determined that only enhanced sales taxes generated by the properties described in an application shall be subject to division under this ESTIP . It shall be the affirmative duty of the treasurer to collect and hold all such enhanced sales taxes in a separate account apart from the sales taxes generated by and collected from the other sales tax generating uses and businesses within the city and to provide an accounting system which accomplishes the overriding purpose of this section . It is conclusively stated by the city council that this division would not be adopted or implemented but for the provisions of this section. (Ord. No . 1988-758, § 1(24-8), 5-23-88; Ord. No . 1272, § 1, 12-9-02) Sec. 22-81. -Capital improvement fund. The one (1) percent of sales and use taxes earmarked for the capital improvement fund may be utilized in this ESTI P for public improvements so long as the same are within the meaning of the phrase capital improvements as defined in the voter approved sales tax referendum previously held within the city, and provided that the same are found and determined by the city council to be capital improvements which could be provided by the city from the capital improvement fund but for the provision of such improvements by the applicant; provided , however, that such use of capital improvement funds as part of this ESTIP shall be limited to the amount agreed pursuant to section 22-83 hereof; provided further, however, that nothing contained herein shall limit the city council in the determination to appropriate additional capital improvement funds for capital improvements affecting the property in question as a part of the city's regular appropriation and budget process. (Ord. No . 1988-758, § 1(24-9), 5-23-88; Ord. No . 1272, § 1, 12-9-02) Sec. 22-82. -Criteria for approval of application. http:/ /library .municode.com/print.aspx?h=&clientiD= 11707 &HTMRequest=http%3a%2fO/o... 9/5/2012 Mw1icode Page 4 of5 Approval of an application for inclusion in this ESTIP shall be given by the city council, at a public hearing held as a portion of a regularly scheduled city council meeting, based upon the following criteria: (1) The amount of enhanced sales taxes which are reasonably to be anticipated to be derived by the city through the expanded or new retail sales tax generating business ; (2) The public benefits which are provided by the applicant through public works, public improvements, additional employment for city residents , etc .; (3) The amount of expenditures which may be deferred by the city based upon public improvements to be completed by the applicant; (4) The conformance of the applicant's property or project with the comprehensive plan and zoning ordinances of the city; (5) The agreement required by section 22-83 having been reached, which agreement shall contain and conform to all requirements of section 22-83 (6) Approval shall be by motion adopted by a majority of the entire city council. (Ord. No . 1988-758, § 1(24-10), 5-23-88; Ord. No . 1272, § 1, 12-9-02) Sec. 22-83. -Agreement required. Each application for approval submitted to the city council shall be subject to approval by the council solely on its own merits. Approval of an application shall require that an agreement be executed by the owner and the city, which agreement shall, at a minimum , contain : (1) A list of those public or public-related improvements which justify applicant's approval , and the amount which shall be spent on such improvements ; (2) The maximum amount of enhanced sales taxes to be shared , and the maximum time during which the agreement shall continue , it being expressly understood that any such agreement shall expire and be of no further force and effect upon the occurrence of the earlier to be reached of the maximum time of the agreement (whether or not the maximum amount to be shared has been reached) or the maximum amount to be shared (whether or not the maximum time set forth has expired); (3) A statement that this is a personal agreement which is not transferable and which does not run with the land ; (4) That this agreement shall never constitute a debt or obligation of the city within any constitutional or statutory provision ; (5) The base amount which is agreed upon by month , and the fact that if, in any month as specified , sales taxes received from the property do not at least equal such amount, that there shall be no sharing of funds for such month ; (6) The base amount shall be agreed upon which shall consider the historic level of sales at the property in question , or a similar property within the area in the event of a new business , and a reasonable allowance for increased sales due to the improvements and upgrades completed as a result of inclusion within this program ; (7) A provision that any enhanced sales taxes subject to sharing shall be escrowed in the event there is a legal challenge to this enhanced sales tax incentive program or the approval of any application therefor; (8) An affirmative statement that the obligations , benefits , and/or provisions of this agreement may not be assigned in whole or in any part without the expressed http ://l ibrary .m uni c ode.com/p ri n t.as px?h=&clientiD=ll707 &HTMRequest=http%3a%2fO/o . .. 9/5/2 01 2 Municode (9) Page 5 of 5 authorization of the city council , and further that no third party shall be entitled to rely upon or enforce any provision hereof; Any other provisions agreed upon by the parties and approved by the city council. (Ord . No . 1988-758, § 1(24-11), 5-23-88; Ord. No . 1272, § 1, 12-9-02) Sec. 22-84.-Joint venture; liability. The city council has enacted this ESTIP as a joint benefit to the public at large and to private owners for the purposes of providing the city with increased sales tax revenues generated upon and by properties improved as a result of this program ; public improvements being completed by private owners through no debt obligation being incurred on the part of the city , and allowing applicants an opportunity to improve properties which generate sales activities , which improvements make those properties more competitive in the marketplace and further provide to the applicant additional contingent sources of revenues for upgrading such properties . The city council specifically finds and determines that creation of this ESTIP is consistent with the city's powers as a home rule municipal corporation , and that exercise of such powers in the manner set forth herein is in furtherance of the public health, safety and welfare . Notwithstanding any provision hereof, the city shall never be a joint venture in any private entity or activity which participates in this ESTIP, and the city shall never be liable or responsible for any debt or obligation of any participant in ESTIP. (Ord. No . 1988-758, § 1(24-12), 5-23-88; Ord. No . 1272, § 1, 12-9-02) http :/ /library .municode.com/print.aspx ?h=&clientiD= 11707 &HTMRequest=http%3a%2fO/o ... 9/5/2 012 Municode Page 1 of 5 Wheat Ridge, Colorado, Code of Ordinances » PART II· CODE OF LAWS » Chapter 22-TAXATION >>ARTICLE I. -SALES AND USE TAX » DIVISION 5. -BUSINESS DEVELOPMENT ZONE » DIVISION 5. -BUSINESS DEVELOPMENT ZONE Sec. 22-85 . -Program estab lish ed . Sec . 22-86. -Legislative declarations. Sec. 22-87 . -Definitions . Sec. 22-88. -Participation . Sec. 22-89. -Approval of agreement: use of funds generally . Sec. 22-90 . -Uses enumerated . Sec . 22-91 . -Increments. sharing of funds . Sec . 22-92 . -Capital improvement fund . Sec . 22-93. -Criteria for approval of application . Sec . 22-94.-Agreement required . Sec. 22-95 . -Joint venture liability. Sec . 22-96 .-ESTIP and TIF . Sees . 22-97-22-99 .-Reserved . Sec. 22-85. -Program established. There is hereby established within the city the "Wheat Ridge Business Development Zone" program . (Ord. No . 888, § 1, 1-13-92; Ord. No . 1272, § 1, 12-9-02) Sec. 22-86.-Legislative declarations. (a) The city council of the city hereby finds and declares : (1) That the health , safety and welfare of the people of this city are in large part dependent upon the continued encouragement, development and expansion of opportunities for employment in the private sector in this city ; (2) That there currently exists in this city businesses or vacant land which require new development or revitalization opportunities to overcome conditions of unemployment, underemployment , net out-migration of the population, diminution of tax revenues, chronic economic distress and blighting influences such as , but not limited to , deterioration of business districts, deterioration of public infrastructures, traffic and drainage problems or sudden severe economic dislocations; (3) That by creating new development , redevelopment or expansion opportunities for businesses within the city the city council will increase the likelihood that new and improved businesses will generate more municipal sales and use tax revenues for the city in the future. (b) It is therefore declared to be the policy of the city, in order to provide incentives for private enterprises to expand or for new businesses to locate in the city , to develop a program which empowers the city council to designate portions of the city as a "business development zone" Attachment 4 http:/ /library .municode.com/print.aspx?h=&clientiD= 11707 &HTMRequest=http %3a%2f>/o... 9/5/201 2 Municode Page 2 of 5 and to provide for the abatement of certain categories of fees, taxes and other business development-related charges for new development or redevelopment within such districts . (c) The city council has enacted this division 5 of article I of chapter 22 of the Code of Laws as a joint benefit to the public at large and to private owners for the purposes of reducing blight in our business districts and of providing the city with increased sales and use tax revenues generated upon and by properties improved as a result of this program and allowing owners and proprietors opportunities to improve properties which generate sales activities, which improvements make those properties more competitive in the marketplace and further provide to owners and proprietors additional contingent sources of revenues for ungrading such properties . (d) The city council specifically finds and determines that creation of this "business development zone" division and the exercise of the powers enumerated herein are consistent with and promotes the public health , safety and general welfare of the citizens of Wheat Ridge. (Ord. No. 888, § 1, 1-1 3-92; Ord. No . 1993-947, § 1, 12-13-93; Ord. No. 1272, § 1, 12-9-02) Sec. 22-87.-Definitions. As used in this division , the following phrases shall have the following meanings unless the context clearly indicates another meaning: (1) The phrase eligible city fees, charges and taxes shall mean and shall be limited to use tax on furniture and fixtures associated with the initial development or redevelopment "project ," use tax on building materials, building permit fees and zoning fees. (2) The phrase expected incremental future sales and use tax revenue shall mean the amount of the additional sales and use tax revenue , as projected by the city, expected to be generated during the council-designated time period from the time of completion of the "project" over and above the sales and use tax fees generated on the premises in the twelve (12) months preceding the application described in section 22 -88 (3) The phrase owner or proprietor shall mean the record owner, tenant or operator of an individual business or, in the case of a shopping center , the owner of the real property upon wh ich more than one business is operated . (4) Project shall mean the specific development or redevelopment expend itures which relate both to the abatement of "eligible city fees , charges , and taxes" and "expected incremental future sales and use tax revenues ." (Ord. No . 888, § 1, 1-13-92; Ord. No . 1272, § 1, 12-9-02) Sec. 22-88. -Participation. Participation in the business development zone program shall be based upon approval by the c ity council , exercising its legislative discretion in good faith . Any owner or proprietor of an established , proposed or newly purchased business , or the owner or proprietor of an existing business which wishes to expand , may apply to the city for inclusion within the program. Abatement or sharing of eligible city fees , charges , and taxes shall , upon approval of the application by the city council , be granted up to the amount of expected incremental future sales and use tax revenue to be generated by the project during the agreed to time period. (Ord. No . 888, § 1, 1-13-92; Ord. No . 1272, § 1, 12-9-02) Sec. 22-89. -Approval of agreement; use of funds generally. http :/ /lib rary .muni c ode .com/print.as px?h=&cli e ntiD= 1170 7 &HTMRe qu est=http%3a%2fO/o ... 9/5/2 0 12 Municode Page 3 of 5 Approval by the city council of an agreement implementing the provisions of this division shall entitle the applicant to share in the eligible city fees , charges and taxes up to the amount agreed by the city council ; provided , however, that applicant may use such amounts only for the purpose of developing or redeveloping the business within the approved business development zone , which purposes shall be specifically enumerated in the agreement provided for in section 22 - 94 hereof. (Ord. No . 888, § 1, 1-13-92; Ord. No . 1272, § 1, 12-9-02) Sec. 22-90. -Uses enumerated. The uses to which the eligible city fees , charges and taxes may be put by an applicant shall be strictly limited to those which are approved by the city council and relate directly to the development or redevelopment of businesses within the city , which developed or redeveloped businesses will generate more municipal sales and use tax revenues for the city in the future . Priority shall be given to all businesses which make application for inclusion within this program and who agree to utilize the eligible city fees , charges and taxes for the public or public-related purposes identified section 22 -78 of this Code of Laws . (Ord. No . 888, § 1, 1-13-92; Ord. No . 1272, § 1, 12-9-02) Sec. 22-91. -Increments, sharing of funds. The base figure for eligible city fees , charges and taxes shall be divided into twelve (12) monthly increments , which increments are subject to agreement between the parties and approved by the city council , and which increments shall be reasonably related to the amount of sales and use taxes generated on the premises in the twelve (12) months preceding the application received by the city for participation in this program . The accounting and payment provisions of sections 22 - 79 and 22-80 hereof are hereby declared to be applicable to any application approved hereunder. (Ord. No . 888, § 1, 1-13-92; Ord. No . 1272, § 1, 12-9-02) Sec. 22-92. -Capital improvement fund. The one (1) percent of use taxes earmarked for the capital improvement fund may be utilized in this business development zone program for public improvements so long as the same are within the meaning of the phrase capital improvements as defined in the voter-approved sales tax referendum previously held within the city , and provided the public improvements are found and determined by the c ity council to be capital improvements which could be provided by the city from the capital improvement fund but for the provision of such improvements by the applicant. (Ord. No . 888, § 1, 1-13-92; Ord. No . 1272, § 1, 12-9-02) Sec. 22-93. -Criteria for approval of application. (a) Approval of an application for inclusion in this business development zone program shall be given by the city council at a public hearing held as a portion of a regularly scheduled city council meeting based upon the following criteria : (1) The amount of expected incremental future sales and use tax revenue which [can] reasonably be anticipated to be derived by the city through the expanded or new tax generating business ; (2) http:/ /library .muni code.com/pr int.as px?h=&c li e ntiD= 11707 &HTMRequ es t=http %3a%2fU/o ... 9/5/20 12 Municode (3) Page 4 of 5 The public benefits which are provided by the applicant through public works, public improvements , additional employment for city residents, etc.; The amount, if any , of city expenditures which may be deferred based upon public improvements to be completed by the applicant; (4) The conformance of the applicant's property or project with the comprehensive plan and zoning ordinances of the city ; (5) The agreement required by section 22-94 hereof having been reached, which agreement shall contain and conform to all of the requirements of such section. (b) Approval of any application shall be made by motion adopted by a majority of the entire city council. (c) The city council may by three-fourths (o/.) majority vote approve exceptions to the provisions of this division when such exceptions are found to be in the public's interest and such exceptions provide substantial benefit to the city . (Ord. No . 888, § 1, 1-13-92; Ord. No . 1993-947, § 2, 12-13-93; Ord. No . 1272, § 1, 12-9-02) Sec. 22-94. -Agreement required. Each application for approval to the city council shall be subject to approval by the council solely on its own merits . Approval of one application shall not require, or be deemed precedent for, approval of any other application. Approval of an application shall require that an agreement be executed by the owner and the city , which agreement shall, at a minimum contain : (1) A list of those public or public-related improvements which justify applicant's approval , and the amount which shall be spend on such improvements ; (2) The maximum amount of expected incremental future sales and use tax revenue and the maximum time during which the agreement shall continue, it being expressly understood that any such agreement shall expire and be of no further force and effect upon the occurrence of the earlier to be reached of the maximum time of the agreement (whether or not the maximum amount to be shared has been reached) or the maximum amount to be shared (whether or not the maximum time set forth has expired); (3) A statement that this is a personal agreement which is not transferable and which does not run with the land ; (4) That this agreement shall never constitute a debt or obligation of the city within any constitutional or statutory provision ; (5) The base amount which is agreed upon by month , and the fact that if, in any month as specified , expected incremental future sales and use tax revenue received from the property does not at least equal such amount, that there shall be no sharing of funds for such month ; (6) The base amount shall be agreed upon, which shall consider the use taxes generated by the property in question , or a similar property within the city in the event of a new business; (7) A provision that any expected incremental future sales and use tax revenue shall be escrowed in the event there is a legal challenge to this business development zone program ; (8) An affirmative statement that the obligations , benefits and/or provisions of this agreement may not be assigned in whole or in any part without the expressed http:/ /library .municode.com/print.aspx?h=&clientiD= 11707 &HTMRequest=http%3a%2fU/o ... 9/5/2012 Municode Page 5 of5 authorization of the city council, and further that no third party shall be entitled to rely upon or enforce any provision hereof; (9) Any other provisions agreed upon by the parties and approved by the city council. (Ord. No . 888, § 1, 1-13-92; Ord. No . 1272, § 1, 12-9-02) Sec. 22-95. -Joint venture liability . The city council has enacted this business development zone as a joint benefit to the public at large and to private owners for the purposes of providing the city with increased tax revenues generated upon and by properties improved as a result of this program; public improvements being completed by private owners through no debt obligation being incurred on the part of the city , and allowing applicants an opportunity to improve properties which generate sales and other business activities . The city council specifically finds and determines that creation of this business development zone is consistent with the city's powers as a home rule municipal corporation , and that exercise of such powers in the manner set forth herein is in furtherance of the public health , safety and welfare. Notwithstanding any provision hereof, the city shall never be a joint venture in any private entity or activity which participates in this business development zone program , and the city shall never be liable or responsible for any debt or obligation of any participant in this business development zone. (Ord. No . 888, § 1, 1-13-92; Ord. No . 1272, § 1, 12-9-02) Sec. 22-96 . -ESTIP and TIF. If the applicant, owner or proprietor participates in the city 's Enhanced Sales Tax Incentive Program ("ESTIP") or if the owner's or proprietor's business is located in an urban renewal area in which all or a portion of sales tax revenues have been pledged as part of a tax increment financing program , he or she shall be ineligible for participation in this business development zone program . (Ord. No . 888, § 1, 1-13-92; Ord. No . 1272, § 1, 12-9-02) Sees. 22-97-22-99. -Reserved. http ://library .municode .com/print.as px?h=&clientiD= 11707 &HTMReque st=http %3 a %2f%... 9/5/2 01 2