Loading...
HomeMy WebLinkAbout54-00 RESOLUTIONi RESOLUTION NO. 54-00 MICR OFTLMED A RESOLUTION APPROVING REQUEST AD99-30.00 SUBMITTED BY DAVID BERCAW ON BEHALF OF LENK DEVELOPMENT, FOR PROPERTY LOCATED SOUTH OF ZION ROAD, ZONED R-2 MEDIUM DENSITY RESIDENTIAL, CONTAINING APPROXIMATELY 5 ACRES TO ACCEPT A LETTER OF CREDIT GUARANTEEING FUTURE CONSTRUCTION OF STEARNS STREET. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That the City Council hereby approves request AD99-30.00 submitted by David Bercaw on behalf of Lenk Development, for property located south of Zion Road, zoned R-2 medium density residential, containing approximately 5 acres accepting a Letter of Credit guaranteeing future construction of Stearns Street. A copy of the letter is attached hereto marked Exhibit "A" and made a part hereof. PASSED AND APPROVED this 18th day of April , 2000. APPROVED: By: ATTEST: By: ( Heather Woodruff, City Cle /14 eii-fr, Fred Hanna, Mayor NAME OF FILE: CROSS REFERENCE: • lafiditecipt D Date Contents of File Initials 4/8-60 SidztiA-;( Sti- a o Exitr,g7-7-4" UErrae ot- CRSAT7) FM -00 /41.4y % ALAI:liz9-yt 1 /0.1 1 - oece I-10 - to o , , .4...A.: 5 4.--,z4istyjaa-x. ,46 . .75---) 7.21/4 .3-.0/- ao 41 ) z x_ di/11A r di,il- ea 41 o_.* 7.46.V /611,-7 i • • UNIQUE HOMES, INC. 860W 18TH STREET COSTA MESA, CA. 92627 949 645-4579 FAX 949 645-8539 April 19, 2000 Mayor Fred Hanna City of Fayetteville, Arkansas 113 West Mountain Fayetteville, Arkansas 72701 RE • Letter of Credit from Mcfiroy Bank & Trust for Unique Homes, Inc. Regarding Zion Valley Estates Dear Mayor Hanna: This letter agreement is to confirm the understanding of Unique Homes, Inc.("Unique Homes"), and the City of Fayetteville, Arkansas, regarding the irrevocable letter of credit issued by McIlroy Bank & Trust to the City of Fayetteville on behalf of Unique Homes. At its meeting on January 10, 2000, the Planning and Zoning Commission approved recommending to the City Council acceptance of an irrevocable letter of credit in the amount of Seventy-four Thousand Three hundred sixty-four Dollars ($74,364.00) to be issued by McIlroy Bank & Trust on behalf of Unique Hnmes in lieu of a cash escrow deposit of the same amount for the cost of construction of a possible future extension of Stearns Street within Zion Valley Estates and in fulfillment of such requirement for approval of the final plat. As a condition of acceptance by the City Council, the letter of credit is to be renewed each year. At renewal, the amount of the letter of credit is to be increased in the same percentage amount as the percentage increase of the Engineering News Record Construction Cost Index. On January 26, 2000, McIlroy Bank & Trust issued an irrevocable letter of credit in the amount of Seventy-four Thousand Three Hundred Sixty-four Dollars ($74,364.00) on behalf of Unique Homes naming the City of Fayetteville as EXN ierre °Re Mayor Fred Hanna City of Fayetteville, Arkansas April 19, 2000 Page 2 • beneficiary of the letter of credit. The expiration date of the letter of credit is January 26, 2001. The letter of credit provides that the City of Fayetteville may draw upon the letter of credit if Unique Homes fails to honor its contractual obligations with the City of Fayetteville. By execution of this letter agreement, Unique Homes agrees, represents, and covenants that each year, at least thirty (30) days prior to the expiration of the letter of credit then on deposit with the City of Fayetteville, Unique Homes shall submit to the City of Fayetteville a new letter of credit with an expiration date one year beyond the expiration date of the letter of credit then on deposit, and that the amount of the new letter of credit shall be increased in the same percentage amount as the percentage increase of the Engineering News Record Construction Cost Index. Unique Homes further agrees, represents, and covenants that should it not present such new letter of credit at least thirty (30) days prior to the expiration of the letter of credit then on deposit with the City of Fayetteville, that such failure to present a new letter of credit shall be considered a failure by Unique Homes to honor its contractual obligations with the City of Fayetteville, Unique Homes, by such failure to present a new letter of credit, authorizes and directs the City of Fayetteville to present the letter of credit to McIlroy Bank & Trust for payment and to deposit such payment into a cash escrow account for the cost of any future construction of the extension of Stearns Street within Zion Valley Estates. Unique Homes further authorizes and directs McIlroy Bank & Trust to pay to the City of Fayetteville the amount of the letter of credit upon presentment of such letter of credit and under the condition set forth above. UNIQUE HOMES, INC. By: Name: Dale Lenk Title: President CITY OF FAYETTEVILLE, ARKANSAS By: Name: Fred Hanna Title: Mayor • • • • [Letterhead ofUnique Homes, Inc.] March 14, 2000 Mayor Fred Hanna City of Fayetteville, Arkansas 113 West Mountain Fayetteville, Arkansas 72701 RE: Letter of Credit from McIlroy Bank & Trust for Unique Homes, Inc. regarding Zion Valley Estates AD 99-30.00 C 3. Page 31 Dear Mayor Hanna: This letter agreement is to confirm the understanding o f Unique Homes, Inc. ("Unique Homes"), and the City of Fayetteville, Arkansas, regarding the irrevocable letter of credit issued by McIlroy Bank & Trust to the City of Fayetteville on behalf of Unique Homes. At its meeting on January 10,2000, the Planning and Zoning Commission approved recommending to the City Council acceptance of an irrevocable letter of credit in the amount of Seventy-four Thousand Three Hundred Sixty-four Dollars ($74,364.00) to be issued by McIlroy Bank & Trust on behalf of Unique Homes in lieu of a cash escrow deposit of the same amount for the cost of construction of a possible future extension of Stearns Street within Zion Valley Estates and in fulfillment of such requirement for approval of the final plat. As a condition of acceptance by the City Council, the letter of credit is to be renewed each year. At renewal, the amount of the letter of credit is to be increased in the same percentage amount as the percentage increase of the Engineering News Record Construction Cost Index. On January 26, 2000, McIlroy Bank & Trust issued an irrevocable letter of credit in the amount of S eventy-four Thousand Three Hundred Sixty-four Dollars ($74,364.00) on behalf of Unique Homes naming the City of Fayetteville as beneficiary of the letter of credit. The expiration date of the letter of credit is January 26, 2001. The letter of credit provides that the City of Fayetteville may draw upon the letter of credit if Unique Homes fails to honor its contractual obligations with the City of Fayetteville. By execution of this letter agreement, Unique Homes agrees, represents, and covenants that each year, at least thirty (30) days prior to the expiration of the letter of credit then on deposit with the City of Fayetteville, Unique Homes shall submit to the City of Fayetteville a new letter of credit with an expiration date one year beyond the expiration date of the letter of credit then on deposit, and that the amount of the new letter of credit shall be increased in the same percentage amount as the percentage increase of the Engineering News Record Construction Cost Index. Unique Homes Menk VIgb-fayette2.1tr Pocietlith; CoAn2 • • • • • • • AD 99-30.00 C. 3. Page 33 Mayor Fred Hanna City of Fayetteville, Arkansas March 14, 2000 Page 2 further agrees, represents, and covenants that should it not present such new letter of credit at least thirty (30) days prior to the expiration of the letter of credit then on deposit with the City of Fayetteville, that such failure to present a new letter of credit shall be considered a failure by Unique Homes to honor its contractual obligations with the City of Fayetteville. Unique Homes, by such failure to present a new letter of credit, authorizes and directs the City of Fayetteville to present the letter of credit to McIlroy Bank & Trust for payment and to deposit such payment into a cash escrow account for the cost of any future construction of the extension of Streams Street within Zion Valley Estates. Unique Homes further authorizes and directs McIlroy Bank & Trust to pay to the City of Fayetteville the amount of the letter of credit upon presentment of such letter of credit and under the condition set forth above. CITY OF FAYETTEVILLE, ARKANSAS By: Name: Fred Hanna Title: Mayor \lenk klgb-fayette2.1tr UNIQUE HOMES, INC. By: Name: Dale Lenk Title: President AD 99-30.00,it 4101 C 3. page 2 • FAYETTEVILLE THE CITY OF FAYETTEVILLE, ARKANSAS PLANNING DIVISION CORRESPONDENCE TO: Fayetteville Planning Commission Members FROM: Tim Conklin, City Planner DATE: January 10,2000 113 W. Mountain St. Fayetteville, AR 72701 Telephone: (501) 575-8264 AD 99-30.00: Administrative Item (Zion Valley, pp136) was submitted by David Bercaw of • Ball & Mourton, Ltd., PLLC on behalf of Lenk Development for property located south of Zion Road. The property is zoned R-2, Medium Density Residential and contains approximately 5 acres. The request is to guarantee future construction of Stearns Street with a letter of credit. BACKGROUND The applicant for Zion Valley Planned Unit Development has requested approval to submit a letter of credit in the amount of $74,364 dollars instead of depositing the same amount of money into an escrow account to guarantee delayed improvements to Steams Street. The original preliminary plat was approved on June 10, 1996 with the condition of approval to construct Stearns Street to Vantage. On January 27, 1997, the Planning Commission reconsidered this condition and approved delaying the construction of Stearns Street and placing money in escrow to pay for "the cost of the 31' City street for that part of Stearns entirely within the development of the SE comer and half of the cost of the standard 31' street for the remaining portion to the west. The ordinance allows either money in escrow or a bill of assurance/perforrnance bond. Both Planning and the City Attomey are in agreement that the letter of credit would be preferred to a bill of assurance/performance bond to guarantee the improvements. The City Council is required under Section 158.05B of the Unified Development Ordinance to approve this method of guaranteeing the improvements. Staff is recommending accepting the letter of credit instead of requiring the developer to place money into escrow if the letter of credit can be written in a form, approved by the City Attorney and City Council, that will cover anticipated future increased costs of the delayed improvements. Staff is concerned the letter of credit would not keep up with the annual increased costs of constructing the improvement and that the City would incur additional costs at the time of construction. Staff is opposed to allowing the developer to construct the improvements since it would result in the construction of only half of a portion of Stearns Street and would be very difficult to coordinate between two different developers. PLANNING COMMISSION ACTION: YES Required Approved Denied Date. 1/10/00 AD 99-30: Zion Valley . . . • • • Comments • fb AD 99-30.00 C. 3. Page 3 CITY COUNCIL ACTION: NO Required Approved Denied Date: §158.05 OFF-SITE IMPROVEMENTS/DELAYS A. Proportionate Share. lf the Planning Commission determines that a needed off-site improvement cannot be built until future development occurs, the subdivider shall pay to the City an amount determined by the Planning Commission, in accordance with the standards prescribed in §166.07, to be the developer's proportionate share of the cost of said off-site improvements as of the date of final plat approval. 1. The City shall deposit said money into an interest bearing escrow account until such time as the off-site improvement is constructed and shall provide for payment of interest on said amount at the rate of 10% per annum or the maximum rate allowable under Arkansas law, whichever is lower. 2. If the off-site improvement is not constructed within five years from the date of the first payment into the escrow account by a developer, the Planning Commission shall hold.a public hearing, after notification to all affected property owners, to determine the disposition of all money in the escrow account. Following the public hearing, the Planning Commission may: a. Determine that the off-site improvement is still necessary and feasible and can be built within a reasonable time, in which case the escrow account shall be continued for a period specified by the Planning Commission; or b. Determine that the off-site improvement is not necessary, or will not be feasible, or that insufficient development has occurred to render the improvement likely in the foreseeable future, in which case the Planning Commission shall either: (1). Refund the money in the escrow account, with accumulated interest, to the subdivider(s) who made the contribution; or (2). Distribute the money in the escrow account on a pro rata basis to the property owners who purchased lots in the subdivision(s) and the developer(s); or c. With the written consent of a majority of the property owners who have purchased lots in the subdivision(s) and the developer(s), direct that money in the escrow account be utilized for a different purpose which will specifically benefit the neighborhood. B Bill of Assurance/ Performance Bond. The developer mat with approval of the City Council. guarantee payment of said amount so determined by executing a bill of assurance. or erforrnance bond.jrjaJj2_ap_ roved in_ Ci Anornnn e v. Bills of Assurance and/or Performance Bonds shall meet the following requirements. 1. Bills of assurance shall be filed of record and shall be a covenant running with the land; 2. Bills of assurance, or performance bonds, shall obligate the landowner to pay the City the amount so determined by the Planning Commission within ten days from receipt of written notice from the City. HAUSERSCOMMOINDAWNAREPORTAPCV-10-00NAD99-30.wpd AD 99-30: Zion Valley Planning Commission - 1/10/99 Page 6.2 • AD 99-30.00 C 3. Page 4 E. J. Ball Kenneth R. Mourton Neal R Pendergrafta John T. 'Terry Lee—. Rayburn W. Green James L Moore, III a [MAO G. Bercave J. Michael Three'. Joseph D. Reece Shannon L Poore • • •Lsw Offices of BALL & MOURTONV I LTD PLLC A Professional Limited Liability Company EJ. BALL PLAZA - 112 W. CENTER, SUITE 700 POST OFFICE BOX 1948 FAYETTEVILLE, ARKANSAS 72702 TELEPHONE: 501/4424213- FACSIMILE: 501/4424233 December 29, 1999 • Est. 1950 • *Also Licensed In Oldahoma Also Licensed In Texas —Siloam Springs Office a 01 Counsel Tim Conlclin Planning Director 113 West Mountain Fayetteville, Arkansas 72701 RE: Final Plat of Zion Valley Estates Dear Mr. Conklin: We represent Unique Homes, Inc., which has submitted the Final Plat of Zion Valley Estates for approval by the City of Fayetteville. At its meeting on January 27, 1997, the Planning Commission of the City of Fayetteville voted to require Zion Valley, LLC, who was then the developer of Zion Valley Estates, to make a deposit into an escrow for "the cost of a thirty-one (31) foot city street for that part of Stearns Street within the development of the southeast corner and half of the cost of the standard thirty-one (31) foot street for the remaining portion to the west" as a requirement for approval of the final plat. At the time of the decision by the Planning Commission, the cost of the extension of the street was not determined. My understanding is that Stearns Street was considered a collector street when the Planning Commission made this decision It is also my understanding that Stearns Street is no longer considered a collector street and that the extension of Steams Street is not presently scheduled and it is not known when, or if, the extension will be constructed. Pursuant to the requirements of Section 158.05 of the Fayetteville Code of Ordinances, the Plarming Commission may require a developer to pay into an escrow, to be held by the City, the amount needed for an off-site improvement which cannot be built until future development occurs. The deposit may be held for a period of at least five (5) years if the improvements are not constructed. This section further provides that the developer may, with the approval of the City Council, guarantee paYment of the required amount by executing a bill of assurance or a performance bond. The bill of assurance or the performance bond obligates the developer to pay the City within ten (10) days from receipt of written notice by the City. The City of Fayetteville's Engineering Division has accepted the estimate of the cost of the extension of Steams Street made by Crafton, Tull & Associates, in the amount of Seventy-four \Lank dgb-conklinlift AD 99-30: _Zion _Valley • • • • • Tim Conklin - December 29, 1999 4, Page 2 AD 99-30.00 C. 3. Page 5 Thousand Three Hundred Sixty-four Dollars ($74,364.00). We believe that the requirement of placing this amount in escrow is unduly burdensome on Unique Homes, Inc., considering that the deposit would be held by the City of Fayetteville for at least five (5) years. By this letter Unique Homes, Inc., is requesting that the City Council of the City of Fayetteville accept an irrevocable letter of credit, to be issued by McIlroy Bank & Trust, in the amount of Seventy-four Thousand Three Hundred Sixty-four Dollars ($74,364.00) in lieu of a cash escrow deposit of the same amount for the cost of construction of the extension of Stearns Street within • Zion Valley Estates and in fulfillment of this requirement for approval of the final plat. Such irrevocable letter of credit would be in a form normally used by Mcfiroy Bank & Trust. We have proposed an irrevocable letter of credit as a means of guarantying payment which is more reliable than a bill of assurance or a performance bond since the City only needs to present the letter of credit to Mcfiroy Bank & Trust for collection of the guaranteed amount. We further request, in the event the City of Fayetteville decides to extend Stearns Street, that Unique Homes, Inc., be given notice of the decision to construct the extension and be given an opportunity to construct the extension before the City of Fayetteville presents the letter of credit to McIlroy Bank & Trust for payment. You have indicated that this matter is scheduled to be heard by the City Council on January 10,200 • at 5:30 P.M. If you have any questions or need additional information, please feel free to call me at any time. With highest personal regards. Very truly yours, <Z3..ot-ti-t:eSer'aat7 David G. Bercaw xc: Jerry E. Rose, City Attomey, 113 West Mountain Street, Fayetteville, Arkansas 72701 Dale Lenlc, Unique Homes, Inc., 860 West 18th Street, Costa Mesa, California 92627 Al Harris, Crafton, Tull & Associates, Inc., 2345 North Green Acres Road, Fayetteville, Arkansas 72703 \Lent \ dgb-cOnklinlitr 4413 99-30: Zion Valley Planning Commission -1/10/99 Page 6.4 • AD 99-30.00 C 3. Page 6 Principals anny L Brown, P.E. /Sob H. Cratton, P.E. Thomas E. Hopper, P.E. Cline L Mansur, P.E., R.L.S. R.E. (Gene) Reece, P.E. David Swearingen, A.I.A. James L Tull, C.D.A. Principal Emeritus Lemuel H. Tull P E December 10, 1999 Mr. Tim Beavers City Engineer City of Fayetteville 113 W. Mountain Street Fayetteville, AR • • Crofton, Tull & Associates, Inc. Architects, Engineers & Surveyors • • Re: Zion Valley Final Plat (CTA Project No. 99096.00) Associates Everett L Balk, P.E. James B. Geurin, P.E. Al Hants, R.LS. Kurtis J. Jones, P.E: James W. Kooistra, ASA. Jerry J. Kelso, P.E. Tom Mansur, P.E. Robert C. Reece, P.E. Rick G. Rose, P.LS. George G. Strella, P.E., D.E.E. James P. Swearingen, kl.A. Richard Wright, R.LS. Harry G. Gray, P.E. (1941-1997) Dear Jim: One of the requirements for the preliminary plat approval for Zion Valley was that the applicant would pay into escrow the cost of the 31' wide city street for that part of Stearns Road lying entirely within the development at the southeast comer of the site and half of the cost of the standard 31' street for the remaining portion to the west. The Planning Office has asked that our office prepare an estimate of these future construction costs for Stearns Street and submit to your office for review. Attached is a copy of a probable construction cost estimate for this future steams street construction. At this time it is hard to predict how the adjacent property will develop to the south and west, but tried to include enough construction items to cover the future work and used unit prices from similar projects in this area. As shown on the attached work sheet we have estimated a total construction cost for this future work to be approximately $74,364 00. Please contact our office if you have any questions on this estimate. Sincerely, CRAFTON, TULL & ASSOCIATES, INC. Al Harris, Project Manager attachment • AD 99-30:.Zion _Valley • • AD 99-30.00 C. 3. Page 7 Pagel Steams Road Assumptions: 31' back -back curb for approx. 25511 on east side, 1/2 of 31' street, storm drain, and sidewalk for app(ox. 450 If for remaining length of street DATE: 12/10/99 CTA JOB NO: 99096.00 ESTIMATED NO CONSTRUCTION ITEMS 1 SITE PREPARATION 2 EARTHWORK 3 HILLSIDE PLACEMENT 4 ASPHALT PAVEMENT(Ft) 6ECA°143) kph 5 CURB & GUTTER 6 4' CONC SIDEWALK (255' + 1/2 of 450) 7 FUT. STORM DRAIN X-ING (1/2 of 31 If) 8 FUT. STORM DRAIN (1/2 of 3201f) •FUTURE FES (1/2 of 1 ea) FUT. STORM DRAIN X-ING (1/2 of 62 If) 11 CURB INLET (1/2 of 4 ea) 12 EROSION CONTROL 13 CL.7 BASE BACKFILL (1)2 of 100 tons) 14 FUTURE WINGWALLS (1/2 of 2 ea) UNIT OtJANT. LS LS CY SY LF LF LF LF EA LF EA LS TON EA 1 1 1,400 1,600 960 480 15.5 160 0.5 31 2 1• 50- 1 UNIT PRICE $3,000.00 $9,000.00 $8.85 $11.00 $8.00 $9.50 $28.00 $55.00 $600.00 $100.00 $1,700.00 $1,000.00 $12.00 $2,500.00 SUB -TOTAL: ESTIMATED CONSTRUCTION COST: COST $3,000.00 $9,000.00 $12,390.00 $17,600.00 $7,680.00 $4,560.00 $434.00 $8,800.00 $300.00 $3,100.00 $31400.00 $1,000.00• $600.00 $2,500.00 $74,364.00 vasaV • AD 99-30: Zion Valley Planning Commission - 1/10/99 Page 6.6 AD 99-30.00 C. 3. Page 8 Planning Conunission Meeting— January 27, 1997 Page 18 • APPEAL 97-1: ZION VALLEY ADDITION PUD REOUEST FOR RECONSIDERATION OF CONSTRUCTION OF STEARNS STREETt The next item on the agenda was submitted by Harry Gray for Zion Valley Addition PUD located south of Zion Road, east of Venetian Land and west of Stearns Street. The request is for reconsideration of the Planning Commission requirements to construct the portion of Stearns Street lying within the control of this developer At the Planning Commission meeting of June 10, 1996 the Planning Commission approved the development subject to the construction and connection of Stearns Street to Vantage. This requirement was different from what the staff had reconunended which was to "provide a 50' right-of-way at a designed radius at the southeast comer of the property and then provide a 25' right-of-way continuing to the west as generally shown of the concept plat, and provide to the City the funds representing the costs on the standard 31' City street for the segment of Stearns entirely within the development at the SE corner and then 'A of the cost of a standard 31' street for the remaining portion to the west." Mr. Grey, representative of the owner stated he had met with Mr. Beavers and understood he would be required to place the funds for this improvement in escrow or make other assurances to the City, rather than constructing the street at this time. STAFF RECOMMENDATION: Staffreiterated the original recommendation to accept money for improvements rather than construction of the street. Ms. Johnson asked the staff why they supported the appeal. Mr. Beavers stated they support the request for two reasons: it was physically impossible to construct half a street to City's standards. The property line would be in the middle of the street and would interfere with both the grading, as well as the preparation of the subgrade, and the actual placement of the final pavement. The drainage would also be impacted. The second• reason was three City Council members had promised the street would never be built. Mr. Odom asked when this promise had been made. He added the street was on the Master Street Plan. • Mr. Beavers replied the statement had been made August 15, 1995. Ms. Johnson did not believe the comments of three City Council members carried any weight unless the Council had voted on something. • Mr. Beavers stated the comment had been made in public. AD 99-30: Zion Val Planning Commission - I/10, Paget Mr. Grey stated it was impossible to build one-half of a street. • • • Planning Commission ALPO January 27, 1997 Page 19 • AD 99-30.00 C. 3. Page 9 Mr. Grey stated they were proposing to place the money for the street in an escrow account. In response to a question from Mr. Allred, Mr. Grey stated they did not want to vacate the right- of-way. Mr. Harbison asked if they had a problem moving the road to the north. Mr. Grey replied, if they were to move the road, it would create a jog in the road. Mr. Reynolds thought they should keep the right-of-way and place the money in escrow. Mr. Tucker read the motion from June 10 that required the street to be constructed. Mr. Grey stated they did not own the all of the property required to construct a whole street. Ms. Little stated Mr. Grey was asking to give the money to the City to provide for the construction of everything he would have been required to construct. Mr. Forney asked how the City could be sure they were getting the full amount. Mr Beavers believed they would receive an accurate estimate from NW Engineers, which the Engineering staff would review. The money could potentially revert back to the developer after five years, but there would be a public hearing. Mr Odom stated he would support the staff's recommendation. He advised he supported building Stearn Street noting it was on the Master Street Plan. He thought Stearn Street needed to be built; and they needed to make sure they had the money to do it. MOTION • Mr. Odom moved to grant the appeal. The applicant would pay into escrow the cost of the 31' city street for that part of Stearns entirely within the development of the SE corner and half of the cost of the standard 31' street for the remaining portion to the west Mr. Allred seconded the motion. The motion carried by a vote of 8-1-0 with Mr. Tucker voting nay. The meeting adjourned at 8:15pm. AD 99-30: Von Valley Planning Commission • 1/10/99 Page 6.8 k099-30.00 Zion Valley One Mile Diameter AD 99-30: Zion Valley Planning Commission - 1/10/99 Page 6.10 • • • • Planning Commission Mmutes January 10, 2000 Page 8 AD99-30: ADMINISTRATIVE ITEM ZION VALLEY, PP136 • AD 99-30.00 C. 3. Page 13 This item was submitted by David Bercaw of Ball & Mourton, Ltd., PLLC on behalf of Lenk Development for property located south of Zion Road. The property is zoned R-2, Medium Density Residential and contains approximately 5 acres. David Bercaw was present on behalf of the request. Committee Discussion Johnson: Does staff have anything further? Conklin: I need to call your attention to page 6.2. This matter does need to be reviewed by the City Attorney and approved by the City Council. The letter of credit needs to be tied to the Engineering News Record, Construction Cost Index. Bercaw: I'm with Ball and Mourton. I did discuss with Mr. Conldin the indexing of the letter of credit. I do think it will have to be an annualized letter of credit and increased each year according to the cost of the construction index. My understanding is it would probably increase around 2 to 3 percent per year. We have no objection to it being a nondiscretionary letter of credit. Johnson: Give us the definition of what you are using as a nondiscretionary letter of credit. Estes: Simply stated, with a nondiscretionary letter of credit there can be no conditions based upon the exercise of the letter of credit. If the letter of credit is called, it is called. There are no conditions of any nature placed upon the call of the letter of credit When called, it is paid. Conldin: I would like to bring up an issue that was requested by Mr. Bercaw in his letter. They had requested they be given a certain amount of time to construct the improvement and I want to make sure it does not conflict I'm not sure if that is a condition They are asking for permission that when the letter of credit is called that they have a certain number of days where they can actually construct this improvement Johnson: What is the staff's position on that request? Conldm: Staff is not opposed to allowing them to construct the improvement as long as the construction meets the city street standards and meets the standards for development in the area. P/Mbt co",21::.• • • Plannmg Commission Minutes January 10,2000 Page 9 • AD 99-30.00 C. 3. Page 15 Johnson: Did the previous Planrung Commission action preclude the developer from building the street? Conklin: The original Planning Commission action required the developer to actually construct the street. They came back a year later and requested to not construct the street and could monies be escrowed. That was approved by the Planning Commission. Now, they have come back and asked if they can use a letter of credit to guarantee the improvement instead of putting the money into escrow. Johnson: Or build the street themselves? Conklin: That is correct. Johnson: I would prefer that the annualization of the letter of credit be submitted to the staff for it's approval rather than to the Commission. Odom: The agreement allows it to go into escrow. I'm looking at the minutes of the meetmg where we agreed to do that on January 27, 1997. Has any money ever been placed in escrow? Conklin: No money has been placed in escrow. Odom: Is that unusual? Conklin: We normally get the money prior to our sign off on the mylar which is recorded at the county. Once that money is placed in escrow, the five year time period begins. If it is not expended within that penod, there is a public hearing of the Planning Commission to decide what to do with that money Typically, we get that after the development is built and prior to sign off of the mylar copy of the final plat. Odom: We have not signed off on it? Conklin: We have not done that yet. Public Comment None. MOTION • Commissioner Estes made a motion to approve administrative item 99-30 subject to the • • • AD 99-30.00 C. 3. Page 17 Planning Commission Minutes January 10,2000 Page 10 condition that the letter of credit be nondiscretionary, that the cost basis =tease be based upon the Engineering News Record, Construction Cost Index and that the letter of credit be annualized. By that, I mean, that it be brought back to the staff' on an annual basis for review and be increased in accordance with the Engineering News Record, Construction Cost Index. Commissioner Johnson seconded the motion. Johnson: The motion by Commissioner Estes is to grant the requested administrative item allowing a letter of credit to be posted by the applicant. It would be an annualized letter of credit. It would be nondiscretionary and it would be annualized to the extent that every year the cost would be adjusted by tying it to the Engineering News Record, Construction Cost Index. Shackelford: Clanfication, please. This motion states that the letter is nondiscretionary, therefore, we are taking away their ability to build the road themselves We're strictly saying when the road is going to be built, we'll draw on the letter of credit and do it ourselves. I think we need to resolve what Tim was saying and what Commissioner Estes was saying on the nondiscretionary matter. Estes: My thinking was that the applicant would have the opportunity to build or complete the construction of Sterns Streets and if they do not do so, then the City calls the letter of credit and the future construction of Sterns Street is paid for with the nondiscretionary letter of credit and is constructed by the city. Johnson: That was my assumption on the second as well. Hoffinan: I would like to offer a friendly amendment that the final condition be that this letter of credit be in a form finally approved by the City Attorney. I know it's going forward to the City Council but I would like it to be formalized or recorded according to Arkansas State Law. I think it is a little unusual to take so long in figuring out how to do the street. I would like to put in every precaution that we can. Estes: I accept the amendment. Johnson: We have five specific conditions. The letter of credit is nondiscretionary. The cost is to be tied to the Engineering News Record, Construction Cost Index The letter of credit amount will be annualized The applicant will have the opportunity first to construct the street itself before the letter of credit is called and the letter of credit must be approved by the City Attorney. Odom: Mr. Bercaw, you are a representative of Ball and Mourton and I guess you are here on behalf of the applicant.