HomeMy WebLinkAbout9.b. Letter of Intent for Dakota Fieldhouse
EXECUTIVE SUMMARY
City Council Regular Meeting: November 17, 2015
AGENDA ITEM: Letter of Intent for Dakota Fieldhouse
L.L.C.
AGENDA SECTION:
New Business
PREPARED BY: Dwight Johnson, City Administrator AGENDA NO. 9.b.
ATTACHMENTS: Proposed Letter of Intent APPROVED BY: ddj
RECOMMENDED ACTION: Motion to approve the attached letter of intent with Dakota
Fieldhouse L.L.C. and authorizing the Mayor and City Clerk to sign it.
BACKGROUND
Earlier this year, the Council held a recreational summit with our leading athletic associations serving
Rosemount. RAAA indicated that indoor court/gym space is the top priority and need for them. In
addition, the City has previously identified the need for a public swimming pool facility.
Mr. Dan Corley, dba Dakota Fieldhouse L.L.C., has been developing plans for a large private indoor
athletic facility which would include both substantial court space and a swimming pool. Based on
discussions with staff, Mr. Corley is willing to provide public access to Rosemount residents for the pool
and facilities through daily fees and also provide 5000 hours of court time to RAAA, all at rates to be
negotiated. In return, Mr. Corley requests development assistance primarily for land acquisition and/or
site development. An overall amount of City assistance of $1 million has been discussed, and staff has
preliminarily determined that the majority of the assistance could come from implementation of a
common economic development tool known as tax abatement for the facility. If the project proceeds and
is completed, residents would gain access to significant new tax-paying recreational facilities at a capital
cost that would be a fraction of the cost of an equivalent publicly constructed facility.
DISCUSSION
The Council reviewed the concept of a Letter of Intent on October 12th and November 9th. The draft
letter was developed based upon previous discussions about reviewing economic assistance that could be
provided to a private developer providing proposing to provide a needed or desired service to the
community. The City Attorney has taken the concept outline and developed the attached Letter of Intent.
The letter of intent is not binding on either side, but is meant to be a good faith framework for a
subsequent development contract. In general, the agreement provides significant public access to new
recreational and athletic facilities in the community in return for development assistance from the City for
site acquisition and/or site development for the project.
RECOMMENDATION
Staff recommends approval of the Letter of Intent and work cooperatively with the project under the
general terms of the letter.
469981v3 MDT RS215-1
LETTER OF INTENT
BETWEEN THE CITY OF ROSEMOUNT
AND DAKOTA FIELDHOUSE L.L.C.
The City of Rosemount, Minnesota is a municipal corporation with offices at 2875 – 145th Street
W., Rosemount, Minnesota 55068 (the “City”), and Dakota Fieldhouse LLC, a Minnesota limited
liability corporation, with offices at 16963 Evening Terrace, Lakeville MN 55044 (the
“Developer”).
Developer has requested that the City provide certain assistance in connection with the
development of property located at a site to be determined (“Property”) in the City. The
proposed development would consist of an approximately 60,000 square foot field house facility
that includes swimming facilities, court spaces and a walking track (the “Project”). In order to
make the Project financially feasible, Developer has proposed that the City provide the
Developer with financial assistance for site acquisition and site development costs. In order to
make the Project financially feasible, the parties have determined to negotiate in good faith
toward a more definite development contract regarding the Project.
The parties desire to enter into this Letter of Intent setting forth their respective responsibilities
during the period while the City considers Developer’s request.
NOW, THEREFORE, the City and Developer hereby mutually agree as follows:
1. The City will direct its staff and legal and financial consultants to review and analyze the
Project and potential financing assistance, including for example tax abatement, park
dedication credit, or use of Capital Improvement Funds.
2. The City and Developer will negotiate towards a more definitive development agreement
providing generally for: (a) financial assistance from the City in an amount up to $1 million,
or in an amount determined by the City, relating to site acquisition, site development and
construction of any public improvements for the Project area in order to make the Project
feasible; (b) timely construction of the Project by the Developer with an anticipated
completion date of December 31, 2018; (c) standards for repair, maintenance and operation
of the facilities on the Property; (d) use of the facilities by the City and its residents; (e)
handling of legal disputes; (f) terms for daily rates for use of the facilities by Rosemount
residents and persons who work in the City; (g) 5,000 hours of court time for the Rosemount
Area Athletic Association at a rate to be determined; (h) payment by Developer of certain
fees and costs incurred by the City, as negotiated by the parties; and (i) other matters as
determined necessary by the parties.
3. The Developer will cooperate with the City’s review and analysis, and provide to the City
all documents and information requested by the City in connection with that effort.
4. The parties agree and understand that the City’s agreement to provide financial assistance
for the Project is subject to: (a) the City’s ability to meet all the requirements of Minnesota
Statutes and other applicable laws relating to such assistance; (b) City approval of all
469981v3 MDT RS215-1
necessary land use applications; and (c) negotiation and execution of a definitive
Development Agreement regarding the Project which, when executed, will supersede all
obligations of the parties hereunder. Nothing in this Letter of Intent obligates the City to
approve the Project or any Developer request for assistance, and any Development
Agreement is subject to approval by the Rosemount City Council.
5. Either party may at any time terminate this Letter of Intent with 10 days’ written notice to
the other. Upon such termination, neither party shall have any further obligations to the
other under this Letter of Intent.
6. This Letter of Intent automatically terminates if the City has not approved a Development
Agreement for the Project by December 31, 2016.
7. This Letter of Intent does not constitute or create any binding or enforceable obligation
on the part of either party. No such obligation shall be created except by the execution of
a Development Agreement containing the terms and conditions of the proposed Project as
shall be mutually agreed upon by the parties.
By the signatures below the Developer and the City mutually accept the terms and conditions
identified herein this ______ day of __________, 2015.
DAKOTA FIELDHOUSE L.L.C. CITY OF ROSEMOUNT
By:
Its Mayor
Its _______________________________
By: __________________________________
Its City Clerk
Its __________________________________