Loading...
HomeMy WebLinkAbout03/25/2002AGENDA CITY OF WHEAT RIDGE URBAN RENEWAL AUTHORITY Monday, March 25, 2002 5:30 p.m. Notice is hereby given of a Public Meeting to be held by the City of Wheat Ridge Urban Renewal Authority on March 25, 2002, at 5:30 p.m., in the Police Training Room of the Municipal Building at 7500 West 29`h Avenue, Wheat Ridge, Colorado. 1. Call the Meeting to Order 2. Roll Call of Members 3. Approval of Minutes - March 11, 2002 4. Public Forum (This is the time for any person to speak on any subject not appearing on the agenda. Public comments may be limited to 3 minutes.) 5. Joint informational session with City Council - Attorneys for the Urban Renewal Authority and the City will present an overview of forming urban renewal authorities, powers of an authority, adopting urban renewal plans, and taa increment financing. 6. Old Business 7. Other Matters 8. Adjournment ` NIINUTES OF WfIEAT RIDGE URBAN RENEWAL AUTHORI'TY March 11, 2002 5:30 p.m. 1. CALL THE MEETING TO ORDER The Wheat Ridge Urban Renewal Authority meeting was called to order by Chair Dick Matthews at 530 p.m. The meeting was held in the second floor conference room of the Municipal Building, 7500 West 29th Avenue, Wheat Ridge, Colorada 2. ROLL CALL OF MEMBERS Commissioners present: Norm Burkpile Sandra Coilins Vance Edwards (Arrived at 6:10 p.m.) Jun Goddard Elwyn Kiplinger Janet Leo (Arrived at 5:52 p.m.) Dick Matthews Kandi McKay Mazgy Platter (Arrived at 5:36 p.m.) Commissioners absent: John Hall Aiso attending: Jim Windholz, Urban Renewal Attorney Alan White, Planning Director Amie Ray, Szymanski/Ray 3. APPROVAL OF MINUTES The minutes of the regulaz meetings of February 11 and February 25, 2002 were presented for consideration. It was moved by Elwyn Kiplinger and seconded by Sandra Collins to approve the minutes as presented. The motion passed unanimously. 4. PUBLIC FORUM Larry Ackerman - Commercial West Realty - Mr. Ackerman represents the owner of the Perkins Restaurant on 44t Adenue and inquired about the status of urban renewal plans for that azea. A meeting will be ananged with Mr. Ackerxnan, Jun Windholz, Arnie Ray and Alan White to discuss the urban renewai status of the area. WRURAMinutes Page 1 03/11/02 5. NEW BUSINESS A. Confirmation of the I-70 Corridor Studv Area Alan White presented a map showing the proposed boundaries of the study area. There were some questions about whether certain azeas should be included. It was moved by Sandra Collins and seconded by Norm Burkpile to table this matter until more study can be given to the boundaries along 38th Avenue west of Kipling. The motion passed unanimously. B. Extension of contract with Szymanski/Ray Alan White presented a letter of agreement with Szymanski/Ray which would extend the scope of services by a total of up to $10,000 and would involve about two mare months of work. This would bring the total fee to $38,000. He reminded the Authority that the original'fee of $18,000 was basically for the Times Squaze area and a lot has been added to their scope of work since that time. It was moved by Sandra C-0llins and sAacoaded by Tsiwyn Kiplinger to extend the contract with Szymanski/Ray to continue to work on the redevelopment proposal up to the point of determining development feasibility and not to exceed $10,000. The motion passed unanimously. C. Joint Meeting with City Council- Urban Renewal 101- Participation of WRURA Board Alan White announced that a joint meeting with City Council and WRiJRA to explain the urban renewal process is scheduled for March 25, 2002. Jim Windholz will prepare an outline for the meeting. 6. OLD BUSINESS There was no old business to come before the Authority. 7. OTHER MATTERS There were no other matters to come before the Authority. 8. EXECUTIVE 5ESSION It was moved by Sandra Collins and seconded by Norm Burkpile to enter into executive session under CRS 24-6-402(4)(a) and (e) for the purpose of developing negotiating strategies for the potential redevelopment and/or acquisition of properties in the 38th Avenue Corridor, Wadsworth Boulevard Corridor, and 44tb Avenue/Ward Road Redevelopment Areas and instructing negotiators, consultants and attorneys. The motion passed unanimously. ~ WRiJRA Minutes Page 2 03/11/02 Those present during the executive session were the same as those listed as present at the beginning of the minutes. The executive session was concluded at 6:54 p.m. The regular meeting was reconvened. It was moved by Sandra Collins and seconded by Elwyn Kilinger to approve an allocation of $10,000 to initiate appraisals at 38~ and Sheridan subject to approval by Dick Matthews. The motion passed unanimously. 7. ADJOiTRNMENT It was moved by Janet Leo and seconded by Sandra Collins to adjourn the meeting at 7:00 p.m. The motion passed unanimously. Dick Matthews, Chair Ann Lazaeri, Secretary WRURA Minutes 03/11/02 Page 3 WINDHOLZ & ASSOCIATES ATTORNEYS AT LAW - 1650 38TH STREET SUITE 103 WEST BOULDER,COLORAD080301 JAMES A. WINDHOLZ, P.C. Telephone: (303) 443- 3100 DAVID S. WILLiAMSON Fax: (303) 443- 7835 WILLIAM P. HAYASHI - - MEMORANDUM TO: Mayor, City Council and Urban Renewal Authority Board of Commissioners, City of Wheat Ridge FROM: Jim Windholz DATE: March 18, 2002 RE: GENERAL PROCEDURES FOR ESTABLISHING AN URBAN RENEWAL AUTHORITY, ADOPTING AN URBAN RENEWAL PLAN AND IMPLEMENTING A REDEVELOPMENT PROJECT (LTRBAN RENEWAL 101) A. LB IGHT The prerequisite to the establishment of an authority is sufficient evidence to support the city council's fmding of the existence of blighted area(s) within the city. Legally, "blighted area" means an area which in its present condition and use, and by reason of the presence of at least four of the following factors of blight, has substantially and adversely affected or slowed the reasonable growth of the city, hindered the provisions of decent housing, or constitutes an economic or social liability to the city, and thereFore presents a detriment to the well-being of the community. At least four (or more) of the following factors shall constitute blight: 1. Slum, deteriorated, or deteriorating structures. Itis the process of deterioration or the existence of ouhnoded structures, which constitutes blight, not the total deterioration itself. The emphasis is upon the area as a whole and not individual structures; 2. Predominance of'def'ective or inadeauate street lavout. This factor includes such conditions as inadequate widths, dead ends, conditions of eatisting streets, poor provisions or unsafe conditions for the flow of traffic, including pedestrians and bicycles, traffic congestion, obsolete and impractical street layout, or inadequate facilities for traffic flow through the area; 3. Fault Iv ot lavout in relation to size: adeguacv, accessibili . or usefulness. Such problems as long and narrow ar irregulazly sized properties, obsolete and impractical lot layout and configurations resulting in stagnant and unproductive conditions of the land by the misuse or nonuse of same, are some of the elements of this factor; 4. Unsanitarv or unsaf'e conditions. The area does not have to contain slums to qualify as blighted and require redevelopment. Elements of this factor may include the existence of a floodplain, inadequate storm drainage systems, poor fire protection facilities, high or unusual crime statistics, inadequate or lack of water or sanitary sewer systems, or existence of hazardous materials or conditions; 5. Deterioration of site or olher improvements on the site. Elements of this factor may include matters such as inadequate open space, lack of public utiliries and public or private services, the incompatible mixture of residential, industrial, and commercial activities, improper and unproductive use of the land, failure to use land, leaving it unproductive or for no public purpose, unwise planning and zoning, and poor regulatory code provisions or enforcement; 6. Unusual toDOgvanhv. Severe and significant slopes making use of properiy difficult, very expensive or impractical may be included in this factor; 7. D~e ective or unusual conditions of title rendering the title unmarketable. The considerations of this factor of blight include diversity and multiplicity of ownership making assemblage of land or accumulation of a single, large tract of land very difficult, and title problems such as the interruption of the chain of ownership or tracing of the ownership of the property; 8. The existence of'conditions that endanger Zife or,oropertv bv- fire or other causes. Factors such as buildings or property not in compliance with fire codes, building codes or environxnental regulations (asbestos or soil cont2mination) may be applicable here; 9. Buildings that are unsafe or unhealthY for persons to live or work in because of'building code violations, dilapidation, deterioration. defective design, phvsical construction, orfauZty or inade(juate f'acilities; 10. Environmental contamination of buildings orpropertX; 11. Inadeguate public improvements or utilities. 2 If there is no obj ection by the properiy owner(s) and tenants of such owner(s), if any, to the inclusion of such property in an urban renewal area, "blighted area" also means an area that, in its present condition and use, and by reason of the presence of any of the factors in 1 through 11 above, substantially impairs ar arrests the sound growth of the city, retards the provision of housing accommodations, or constitutes an economic or social liability, and is a menace to the public health, safety, marals or welfare. An azea may be eligible as an urban renewal area if it meets the legal criteria as a slum or blighted area. It is not individual or sepazate conditions, facilities, structures, properties or improvements which are the determinant of such designation, but rather the area taken as whole. An entire designated urban renewal area does not have to be blighted; the existence of at least four blight factors within an area is all that is required to substantiate a designation as an urban renewal area. The boundaries of an urban renewal area may be expanded at any time by city council pursuant to the presentation of evidence and findings of the existence of blight within the additional area. It is not required that urban renewal areas be conriguous. Rather, a number of separate urban ren€wal areas may exist within the commuxiity. However, all urban renewal areas must be within the city boundaries. B. PROCESS OF ESTABLISHING AN URBAN RENEWAL AUTHORITY The general process of establishing an urban renewal authority is as follows: 1. Twenty-five (25) registered electors of the city .petition the city council that there is a need for an urban renewal authority to function within the community. 2. A blight study/analysis should be authorized by city council. 3. Notice must be provided of the time, date, place and purpose of a public hearing on the petition for the council to deterxnine if there aze sluxn or blighted areas within the city based upon the blight study, and, if so, if there is a need for an authority. Such notice is at the city's expense and must be given at least 10 days before the hearing in a newspaper of general circulation within the city, or, if no newspaper, by posting in three public places in the city at least 10 days prior to the hearing. 4. All residents, taacpayers and interested persons are afforded an opportunity to be heard on the issues of whether slum or blighted areas, or both, elcist within the city. 5. If council finds from the facts that: (a) one or more sluxn or blighted areas or both exist within the city; and (b) that acquisition cleazance, rehabilitation, conserva6on, development, or redevelopment of the azea(s) is necessary for the public health, safety and welfare of the residents of the city; and (c) declares it in the public interest that an authority be created, an urban renewal authority may be created by resolution. The resolution must contain detailed findings of blight and the afore described purposes of creating an authority. The resolution should also direct the mayor to appoint commissioners to an urban renewal authority; however, city council may serve as the authority. If so, the mayor shall serve as the chair. Certificates of appointrnent must be filed with the state division of local government. Of course, council may find that no slum or blighted areas exist, and dismiss the petition. Thereafter, the petirioners must wait at least six months to again petition the council for tfie formation of an urban renewal authority. C. URBAN RENEWAL AUTHORITY COMPOSITION The city council may appoint itself as the authority or appoint a separate board of commissioners. If a separate board is appointed, not less than five nor more than 11 members shall be appointed by the mayor, with the approval of council. There is no requirement in the Urban Renewal Law that the coxnmissioners be residents of the city. Only one of the commissioners may be an official of the city. The commissioners who aze first appointed shall be designated by the mayor to serve for staggered terms so that the term of at least one comxnissioner shall expire each year. Thereafter, the term of office shall be for fiue years. The mayor also designates the chair of the authority for the first year. Members of the authority shall receive no compensation but aze entitled to expenses. To be constituted as an urban renewal authority, a certificate signed by all of the commissioners of the authority must be filed with the division of local government in the department of local affairs. An authority shall elecUselect its own vice-chairman, secretary, staff, legal counsel, and after the first year, its chair. The mayor, with council consent, may remove a commissioner for inefficiency or neglect of duty or misconduct in office. The removal procedures require written chazges and a formal hearing befare council. D. URBAN RENEWAL PLAN An authority cannot acquire or transfer real property or undertake an urban renewal project until an urban renewal plan has been adopted by the city council. The proposed plan may be prepared by the urban renewal authority, its staff, city staff or consultants for consideration by council. The plan must include the following: l. Plans to elnninate and prevent the development or spread of slum or blighted areas and redevelopment of such areas with appropriate public and private resources. 2. Outline of preliininary plans for urban renewal activities. 4 3. Plans for relocation of individuals, families and business that will be displaced by the urban renewal project. If any federal funds are used in the project, the relocation plans must follow federal requirements. 4. Plans for programs of voluntary repair and rehabilitation of buildings and improvements. 5. Plans for enforcement of state and local laws, codes and regulations governing land use and use of buildings and improvements. 6. Authorization to use.the powers of eminent domain, if so detemiined by city council. 7. Documents necessary to carry out any of the above including financing plans, maps, appraisals, surveys and studies. The plan may address several other matters, such as phasing and types of development, limitations on types or amounts of financing, authorization of the use of tax increment financing; interim uses of tlie property, and zoning and land use matters. ta plan should be as flexible as possible to allow for market, financial, economic and other conditions, which exist at the time redevelopment actually occurs. After an urban renewal plan is adopted, it controls the land azea, land use, design, building requirements, timing and procedures applicable to property within the urban renewal area. Therefore, while existing city zoning, design and building requirements may control the property, the urban renewal plan is an additional layer of control over the use of the property. To substantially amend an urban renewal plan, the same procedures as required for initial adoption must be followed. If amendment of the plan occurs after sale or lease of property within the urban renewal area, such amendment is subject to equitable or legal rights of lessees or purchasers and successors of properties within the azea. E. PROCEDURES FOR ADOPTION OR SUBSTANTIAL MODIFICATION OF URBAN RENEWAL PLAN As described above, the draft plan may be prepazed by the authority or any other person or entity designated by the city. Prior to approval of an urban renewal plan, city council must submit the draft plan to the planning commission. The plamling commission must review the draft plan and give written recommendations to the city council within 30 days after receipt of the proposed redevelopment plan, specifically and solely as to whether or not the urban renewal plan complies with the comprehensive (master) plan of the city. The city council may proceed with the hearing on the plan upon receipt of the written recommendations of the planning commission or 30 days after subxnission of the draft plan to the plauiiiug commission, whichever is sooner. If the proposed plan includes residential azeas or ueas proposed for residential uses and also contains provisions for the use of property tax increment fmancing, the school district, which is included in the urban renewal area, must be allowed to participate in an advisory capacity with respect to the use of property tax increment financing. Norice of a public hearing is to be published in a newspaper of general circulation within the city. Thirty (30) days written notice of the public hearing is also to be provided to all property owners, residents and business owners, at their last known addresses, in the urban renewal area. The notice must include the tnne, date (not less than 30 days from the notice), place and purpose of the hearing before council, and generally to identify the area covered by the plan and outline the general scope of the proposed urban renewal proj ect. Council must hold a public hearing on the plan. At the hearing, evidence must be presented of blight and the details of the plan. As a courtesy and not a legal right, I recommend that county and school district representatives also be provided notice. Following the public hearing, and subject to notice to the county as described below, the council may approve the plan by resolution if it finds that: 1. Blight exists in the urban renewal area and designate the area as appropriate for an urban renewal project(s); and 2. A relocation plan exists or shall be provided before relocation takes place (if the plan anticipates the necessity of relocating businesses or residents in the urban renewal area); and 3. The redevelopment plan conforms with the city's comprehensive plan; and 4. Private enterprise has been afforded an opportunity to redevelop/develop the urban renewal area; and 5. If the azea consists of open land, a finding must be made that nonresidential redevelopment is necessary to accoxnmodate proper growth and development in accordance with sound planning standards and: objectives of the City; and 6. Property and/or sales tas increment provisions for payxnent of debts and financial obligations incurred in relation to the redevelopment project(s) may be included;and 7. Prior to approval of the plan (easly within the 30 day notice period described above), the council must provide an impact statement to the 7efferson County Commissioners, including, at a ininiinum, the following: a. The estimated time to complete the redevelopment project(s); and b. the estimated annual property tas increment (if property tax increment will be utilized) to be generated by the project and the portion of such property tax income to be allocated during this time period to fund the redevelopment project; and c. any other estimated unpacts of the project on county services or revenues. 8. Other findings must be made upon adoption of the plan by the council, including, that not more than 120 days have passed from the initial public hearing to the approval of the plan, and, if this is a second attempt to amend the plan for this azea, at least a two-yeaz "waiting period" has taken place, unless "circumstances" have changed. 9. At least four of the statutory blight conditions must exist to approve the plan. There are some legal opnuons that one may find four factors of blight within one of the blight categories alone, such as four unsanitary conditions, or four unsafe conditions, or four deterioration factors of the site, or four factars of deterioration of unprovements, or four unusual conditions of title rending it norunarketable, etc. Boundaries of a blighted/urban renewal area aze to be drawn as narrowly as council determines feasible to accomplish the planning and development obj ectives/purposes of the redevelopment proj ect(s). F. POWERS OF AN iJRBAN RENEWAL AUTHORITY An urban renewal authority has the following powers: The powers necessary to carry out the purpose of the urban renewal law. 2. Sue and be sued, adopt and have a seal, perpetual existence, and adopt bylaws, orders, rules and regulations. 3. To undertake urban renewal projects, execute contracts and other documents, including advances, loans, grants and contributions from the federal govemment or other sources. 4. Provide for public facilities and 'unprovements; dedicate properiy for public facilities, improvements and purposes; and agree to contract conditions related to such powers, including those attached to federal financial assistance. 5. Arrange for plauning and zoning of an urban renewal area with the city. 6. Enter private property with the consent of the owner to make surveys and appraisals and to obtain a court arder to do so if the owner refuses pernussion. 7. Acquire property by purchase, lease, option, gift, grant, bequest, devise or otherwise or by condemnation. Hawever, the authority must haue the consent of the owner of public property to condemn properiy devoted to a public use (such as a post office). Hold, nnprove, clear or prepare for redevelopment any property 9. Mortgage, pledge or otherwise encuxnber ar dispose of property in accardance with the urban renewal pian. 10. Insure property and operations of the authority. 11. Invest funds. 12. Borrow money and apply for loans, grants and contributions and give security therefore. 13. Appropriate and spend funds and establish separate accounts. 14. Prepare and submit proposed plans, including urban renewal plans to city council. 15. Make relocation plans/arrangements/payments to residents, individuals and businesses displaced by urban renewal projects. For businesses, relocation payments are to include goodwill and lost profits reasonably related to relocation of the business. 16. Rent or use equipment and office facilities for the authority. 17. Prepare plans for a prograsn of voluntary repair and rehabilitation of buildings and improvements and enforcement of applicable codes and regulations. 18. Create and report methods and techniques for the prevention and elimination of blight within the city. 19. Issue bonds for debt. 20. An authority does not have the power to levy or assess taxes of any nature, including special assessments. These power are not limited by any other law with respect to the planning or undertaking of projects or the acquisition, clearance or disposition of property unless the statute specifically so provides. Other significant limitations on an authority's powers with regard to redevelopment activities, other than those which may be imposed by city council in a plan, are the federal tasc code and regulations related to the tas exempt statutes of financing of the authority's activities/projects. 8 G. SALE OF PROPERTY OWNED BY THE AUTHORITY An authority may sell, lease or otherwise transfer its real property in accordance with the urban renewal plan subj ect to such covenants and conditions as deternuned solely by the authority. The purchasers, lessees and transferees must use the property only as allowed by the urban renewal plan. Property may be transferred for its fair value (not fair mazket value), as determined by the authority. The authority must iransfer properry it acquires for purposes of conveyance as soon as reasonably feasible, which may be detexmined by such factors as market and economic conditions. In the interim, the authority may operate and maintain its property even if such use is not in accordance with the urban renewal plan (i.e. lease it for office space). Property of the authority sold to private persons may only be sold under reasonabie competitive bidding procedures as described by the authority or by the Urban Renewal Law, which requires notice for requests for proposals to redevelop the property to be transferred. The authority shall consider the financial and legal ability of the applicants/respondents to fulfill theu proposals. At least 15 days prior to executing a contract of conveyance of property, the authority must give notice of its intent to the city council. The notice is for information only; council cannot veto oF impose requirements on the transfer. The authority may transfer, dedicate, or devote its property for public uses in accordance with the urban renewal plan with or without compensation, subj ect to such terms, conditions and covenants as the authority determines to be in the best interest of the community and in compliance with the plan. H. NEGOTIATE/AGREEMENT FOR REDEVELOPMENT Along with staff and consultants to assist the Authority to carry out the Council's urban renewal plan, the management team should consist of real estate/development advisors and negotiators to coordinate and effect contracts with developers, property owners, the authority and the City to realize redevelopment proj ects. It is important in the negotiation process that developers (retailers) understand they may negotiate terms of contracts only with the authority's consultants/experts and not be able to end run them through policy makers and public officials when negotiations aze inevitably difficult. Proposed proj ects must, at the very least, eliminate blight, comply with the plan, fif in the commercial market and be fmancially (public and private) feasible. Typically, a redevelopment proj ect involves the following: identifying the market, thereby affecting the land uses (i.e. types of retail, commercial uses); size of the project; control and conditions of the land; infrastructure required (utilities, roads, parking, access); timing (including time requirements for the authority to deliver a clean site and time requirements for the developer to begin and complete project improvements); land use restrictions and covenants, such as types of retail uses and, perhaps, operating requirements (i.e. must operate a certain use, such as a grocery store, for 10 consecutive yeazs); consequences and penalties for not meeting requirements and deadlines, such as financial penalties or right of the authority to take or buy the land back; fmancing, including public and private requirements of funds (this is the greatest risk to the authority in that it must anticipate costs in advance of laiowing fmal costs). Financing variables are influenced by final costs of acquisition of land, relocation of businesses or people and remediation of hazardous conditions or materials. Following negotiations, a redevelopment agreement or disposition and development agreement (DDA) is prepared memorializing the contract between the developer, authority and/or city. With the agreement, the Authority may fmance its obligations under the DDA and undertake other requirements such as acquisition ofproperty, relocation ofbusinesses or persons and remediation of hazardous conditions of the site, if necessary. Again, the financial risk to the Authority is that if assemblage of a redevelopment site requires use of eminent domain, the final fair market value for land and improvements may not be determined until after construction of the redevelopment project has begun or has been completed by the developer. Attached is an outline of a DDA, wtiich will be used as a guide for DDAs in Wheat Ridge. 1. FINANCING URBAN RENEWAL PROJECTS An urban renewal authority may fmance its projects by special or general obligarion bonds, secured by property, loans, grants or other assets of the authority. If authorized by the urban renewal plan, the authority may receive property and/ar sales tax increments. The city may establish improvement districts, special assessments or other funding sources available to it for the authority. The authority may issue tax-exempt bonds; however, because of the Tax Reform Act of 1986, many activities that had theretofore been "common" for urban renewal projects may not be financed by tax-exempt funds. Therefore, the authority may have to issue a combination of tax exempt and tasable bonds or taxable bonds. The manner in which property conveyance docuxnents are structured and the uses of property may also determine whether tax-exempt funds be used. Therefore, an investment banker and bond counsel must be retained at the commencement of the redevelopment process to render advice regarding the financial structuring of urban renewal projects, as well as advice regarding the application of TABOR to financing proposals. Such advice should be utilized and included in the urban renewal plan. J. TAX INCRENiENT FINANCING (TIF) The urban renewal plan may provide far property and/or sales taac increment financing for the authority. If the plan includes provisions for property tax increment fmancing and if the renewal area contains existing or proposed residential uses, the school district within the urban renewal area must be allowed to participate in an advisory capacity with respect to the inclusion of this financing mechanism in the plan. It is recommended that the city 10 provide notices and information to the school district and the county regarding proposed redevelopment programs early in the process. The property tax increment is deterxnined by establishing the assessed valuation of the taacable property last certified prior to adoption of the plan within the urban renewal area as the base amount. The existing ad valorem property taxing entities (school district, county, fire district, water and sanitation district, etc.) continue to receive the taaces generated by their respective levies applied to that base assessed valuation. The tases generated by the levy set by each taxing entity applied to any assessed valuation in excess of the base assessment is paid to the authority as increment. By this method, every other taacing entity can adjust the revenue it receives, and consequently the amount received by the authority, by varying its mill levy. The incremental revenues received by the authority are to be used for debt service and financial obligations of the authority. Upon payment of all financial obligations of the authority or 25 years from the effective date of the utilization of property tax increment in the plan, whichever is earlier, all property tax revenues (base and increment) are to be paid to the respective property tasing entities (county, school district, etc). The sales tax increment is deterxnined by establishing the municipal sales tax revenues collected within the urban renewal area during the 12 months preceding the month the plan is adopted as the base amount. For each plan year thereafter, the city receives all sales tax revenue generated within the urban renewal area until it has received the base amount. Thereafter, for the remainder of the plan year, the authority receives the city's portion of the sales tax generated within the urban renewal area as the increment. If property tax increment financing is used, all (100%) of the increment must be paid to the authority. If sales tax increment financing is used, the plan may provide that a11 or any portion of the municipal sales tax increment be paid to the authority. If there is a general reassessment of properiy or an increase in the sales tax rate, the base amounts must be proportionately adjusted. The county assessor must be notified in writing of the utilization of property tax increment immediately following the approval of the plan by council. K. TIF AND TABOR On February 14, 2002 the Colorado Court of Appeals ruled in Olson v. Golden that the Golden Urban Renewal Authority "is not a local government and therefore not a district under TABOR". The court reasoned that urban renewal authoriries do not shaze some of the characteristics of a"districY' under TABOR, in that they haue no power of taacation nor does the Urban Renewal Law, or any other state statute, provide any authority or means far elections by an authority or related to an authority, which are necessary under certain provisions of TABOR. 11 This rule of law, presently applies to all urban renewal authorities in Colorado. However, there is reason to believe that Ms. Olson's attorney will petition the Colorado Supreme Court to review this decision. If he does so (the deadline for such petition is the end of Ivlazch 2002), the ability of urban renewal authorities to formally function without the requirements of TABOR will be delayed until the Supreme Court dexries the review of the Golden case or accepts review and upholds the rule of law or ovemtiles the Court of Appeals decision. It may take six months for such deterxnination; and if the Supreme Court accepts review of the case, it may, take 12 additional months for a final decision on this issue. Regardless of the time related to this issue, I have been advised by certain bond counsel, and I also subscribe to the legal opinion that the use of TIF in an urban renewal plan is not a tas policy change and not subject to TABOR. JAW/dr xc: Jerry Dahl Randy Young Alan White Rick Buddin Steve Bell Ame Ray Steve Symanski 12 tl~5/18/1bd2 11;24 3d:54431tl37 W1NllHULG NL NAGt 1411tl DTSPOSITION ANA DEVELOPMENT ACREEMENT Fr, pggA.L MIGHI'S REDEW7ELOPMENT AGENCX ANX1 THE CTTY OF FEDERAI. MIG]gTS, C0L012ADd . AND SAF7EWA2' AYC., a Delawaze corporation, and FEDERAI. HEXGHTS PAR7'L`TERS, LTD., a'Iexas limited partneasbip Dated Effective as of August 23,1999 D:%035SSdODA7-AGY.VPb b3lIGl1ML 11:L4 3bJ4431tlJ5 W1fJllHULL YL YAUt 15/ltl rABLE or corrTErrr.s fiF.C:T7niV' ~ PaQe 1. D£FiMTIONSANDPUIiPOSE . .........................................3 1.1 befinitions .....................................................3 1.2 Pu ose ...........1] 2. AESCRIi'TION OF X120.TECT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 - 3. PiJRCF3ri.SE OF "I'HE PROY]ERI'X/flMt)N TO PURC]HA.SE . . . . . . . . . . . . . . . 12 3:.1 Aereement to Purchase . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 32 Purchbse Price for the ProMM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . a. . . 12 33 Safeway FHP a!e Aareement-Purch2se rice £or the FHP Property, 12 115 TrefficSiQnal ----.........I3 3.6 CashPa,ment. ...13 4. INTENTIOPIALZ,X OMITTED............... . . . . . . . . . . . . . . . . . . . . . . . . . . 13 5. A,CCESS TO THE PROPERTI' ANI1tOR IMPItO'VEMEN'PS . . . . . . . . . . . . . . . . 13 5.1 Acoess bv the A¢enc~v or Citv . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . : . . . . 13 5.2 A,cess bv the Dev ~eloners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 6. CONDTi'IONS PT2ECEDEPI'I"Z'O CLOSING; CZOSXI+IG . : . . . . . . . . . . . . . . . . . . 14 6.1 Acgiiisition of the_SitQ . . . . . . . . . . . . . . . . . . . . . . . . . _ . _ . . . . . . . . . - - - . 14 6.2 Former Businesses and/or Tenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 63 ~ice Preparation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 6,4 DemolWon Asbestos Abafemeni and EnviL2nmen#al Remedi ta ion. 74 6.5 Completion Qf Roueh Crradin~ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 6.6 Approva3 ofPtM and Site Development Plan . . . . . . . . . . . . . . . . . . . . . . . . . . 15 6.7 RenlatofProje ea ......15 6.8 Fvidence ofLeases anci/qr Cocrtracts. . . . . . . . . . . . : . . . . . . . . . . . . . . . . . . . . 15 6_9 Decl ti n. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 6.10 Bvidence oPEiaancing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 6.11 FHP Sale Aueement . . . . . . . . . . . . . . . . . . . • - - • • • ' ' ' ' Safeway_ ' 6.12 , 3se Cove s Abreemen 16 6.13 ,4eency-FfiI'-SafewU Ontion A- eement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 6.14 TitfeandSurveV _..T6 6.15 t ino ......i6 7. QBI.,IGATiONS OF DEVJELdPERS AF'TER CT.OSTNG . . . . . . . . . . . . . . . . . . . . 16 7,1 Constructio ofTmnrovements'SaleorLeaseofPadSites ......16 11 D:\035501UJDA:.AG'4'.'a'PD b-J/ltl/LbbL 11:L4 3b349~J1835 WINUHULL YL YHUt lb/1G 8. AGENCY FINANCIPTG; FEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 8.1 Qgencv Financing . ............17 8.2 Taxesand Fees . .......---..18 9. CONVEYANCE TO DEVELOPER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 9.1. irV u . ............18 9.2. Form of Deeds' R cordinb . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 S 9_3 Title and Survey . 18 9.4 ConditionofTitie . .............19 - 9.5 TitleI su cePolicies . 39 9,6 S12ecial Assessments or Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 9.7 AdValaremTaxes 20 10. REPRESENx'A'X'XONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . - . 20 10.1 ReoTesentations and Wazranties of th'-~ afeway . . . . . . . . . . . . . . . . . . . . . . . . . 20 10.2 Representatimismd Warrantie ofFHP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 103 Revresentations a d Warranries ofthe A~rX . . . . . . . . . . . . . . . . . . . . . . . . . . 22 i l. CrEIYERr1L CC}lElYt1N"TS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 11.1 Financial InfotmatiQ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 112 Salss and Leasin2 RepoRs . . . . . . . . . . . . . : . . . . . . . . . . . . . . . . . . . . . . . . . . 23 11.3 Coopecation Regazding Lit~ an~, t~on . . . . . . . . . . . . . . . . . - . - - - . . . . . . . . . . . 23 11.4 Relocxtion ofTenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 12_ LAABTT.i'T'Y; IlNDENZNUMS; IlNSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 12.1 Non=lSabilitY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . : . . . . . . . . . . . . . . . . . . . 23 afeway Indemnification- Insurance . . . . . . . . . . . . . • . • • • • . 12.2 • - - • • • • • • • . . 23 , 12.3 FIV Tndemnification_ I rance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 12_4 e airorReconstruction(SafewayTiuorovementsl . ...............25 12.5 Raaif or Reconstructon (FHP' Improve nt . . . . . . . . . . . . . . . . . . . : . . . . . 25 12.6 Envi onmental Indemnity.(SgfewaY) . . . . . . . . . . . . . . . . . . . . . . . . . • - - - - . . . 25 12.7 Environmental Tndemnity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 12.3 "As Is" N mre af7ransaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . : . . . . . . 27 13. AEFAULT; E'VENT OF DEFAULT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 131 Default hy Saf~wav . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 13.2 Default byFHP . . . . . . . . . . . . . . . . . . . . . . . : . . . . . . . . . . . . . . . . . . . . . . . . . 29 13.3 Default b th AQenc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . : . . . . . . . . . . . 30 E'l'ENTS OF AEFA'ULT; NOTLCES OF DEFAULT; QPPl7R'I'UNITY'IO CUTlE 14 . AEFAULTS; RENiEAIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 14,1 Notice ofDefaults 0122g;1anity to Ce efau]ts . . . . . . . . . . . . . . . . . . • . 30 111 D:16755154\DDA7.AGr-R'PD tlS/ltllZtltlZ 11:Y4 6bd4431d3' W1NUhUL4 rG rHVC 1f/l~ 14.2 Develctpgn' Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . _ _ . . 30 143 AtrencyRemedies . 31 14.5 Force Maieure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 15. TEZiD'IIPIA'Y'ION; EXPIRA'ZJQ1V OF AGMEMEN'X'. . . . . . . . . . . . . . . . . . . . . . . 32 15.1 Deveiop~rs' Qption t Terminate Pri o Closina . . . . . . . . . . . . . . . . . • • • . . . 32 I52 The Aiency's Oa~on to Terrninate Pnor co Closine. . . . . . . . . . . . . . . . . . . . . 32 153 rminatioa the - c After Clo " ~ . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 15.4 Term'nation bv tht~ Developers After Clos. . . . . . . . . . . . . . . . . . . . . . . . . . . 3; 15.5 fioeto Terminate _ 15.6 Effect of Te inatio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 15.7 Actians upon Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 15.8 Expiratio . ............33 16. AE'rENCl"S ANA FHP'S OPTION TO REPUtCHASE (SAFEWAY DLE'AULT)- ..........34 17. AGENCX' S AND SAFEWAY' S OPTTON TO REPi71tCHASE (FHP D7EFAULT). ........3G . 18. RESTRdCTIONS ON ASSIGNMENT AND TRANSFER . . . . . . . . . . . . . . . . . . . 36 18.1 Reoresentgjons as to RedevetoQment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 2 No Sale or Transfer WithQut Consent. 18 •••'6 . 18.3 Co 'ti ns to t A enc ' n ent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 18.8 No Sale or Transfer Wit out ConsenY. - - 37 18.5 Saie or Lease of Pad Sites. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . : . . . . . . 37 19 GEN'EIiAL PROVTSIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 . • • . . . . 19.1 Limitations ofRi2hts. . • • • • ~ - • • • • ' ' 37 192 IQo V tin . .............37 33 14.3 hlQtices - - . . . . . 38 19.4 Waivei . . . . . . . . . . . . . . 19.5 Attor eXs' Fees. . . . . . . . . . . . . . . . . . 3S et~. t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . • • - 6 (`onil'cts~ of irtte 19 - - . . . . . . . . 38 _ . 19.7 SurvivaLl. . ............38 19.3 Titles of ecti ns. .............38 9 Ag„nev Not a PartneL7Deveiapers Not A7gncv7s ent. . _ . . 19 . . . . . - - • • • . - - ~9 . 19.10 A li leLaw. . . . . . . . . . . . . . . . . . . .............39 19.11 Binding Eff~. . - - - - . . . . . . . . . - . . . 1.39 . 12 Funhe AsanM. . . . . . . . . . - - - • . 19 .............39 . 19.13 Time o 'Essence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 1914 .Seveiabi itv. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 19.15 C'ood raith- Consentor Approv . . . . . . : . . . . . . . . . . . . . . . . 39 l. V D10355\54k0L).17.AG1'.MD . b3/16!2bb2 11:24 ~b3943/tl35 W1NllHULC YU rHUt 1tli10 . . . . . 40 19.16 Q~Y Cogneratt~.. . . . . . . . . . . . . . . . . . . . . . . . . . • - - . . 40 19.17 Counterparts. - - . . . . . . . . . . . . . . . . . . . . . . 19 18 Non liability of Officials and Fmoloveei . - • ..............40 . 19 20 icorpora ion of ExlINts............................ ~ 40 . 21 19 , Mtmprandumnf A8jeeIISynt• . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 . .40 . 1922 . . . . . . ExUedltiousPmS.essin . . . . . . . . . . . . 40 23 19 - - - . . . . . . . - - . . . . ~ ~hts ofT enders and Interested Parti • • . - . • • . - - • • • • . 24 19 Entire A2r ent• mendments. • • ~ - - • ~ ~ ~ ~ ' ' ql . 19.25 _sto e ertific te. ..............41 19.26 gr~ent Aa~ement Prior Tmuravement and Develo . . . . . . . 41 . LIST OR EXAIF3115 Exhibit A: Legal Description ofthe Property Exhibit AI: Legal Descnption ofthe Safeway Property Exhibit A2: Legal bescription of the Hunt Property Extubit A3: I.egal Description of the Opfion Property Exhibit B: Redevelopment P1an/Site beveIopment Plan Exhihit C: Schedule of Performance Exhibit D: Form of Use Covenants Agreement Exiubit B: Porm of Agency-FTiP-Safeway Option Agreement Exhibit F: Form ofIri-Party Agreement v pA0355~54Mil:17.AGT.WPI)