Title
An Ordinance approving the Road Relinquishment Agreement with the Missouri Highways and Transportation Commission, and a Road Maintenance Agreement with Oldham Investors, LLC, to facilitate the Oldham Village Redevelopment Project.
(Note: First read by Council on September 24, 2024. Passed by unanimous vote.)
Body
Issue/Request:
Approval of an ordinance to facilitate the relocation of Oldham Road in the proposed Oldham Village Project.
Key Issues:
In association with the Oldham Village Development, located at the former Adesa Auto Auction Site at the southwest corner of M291 Highway and US50 Highway South Junction and along Oldham Road, Oldham Road will be relocated between Jefferson Street and Allendale Blvd. Existing Oldham Road within the Oldham Village Development will be obliterated and excess MHTC (MoDOT) property conveyed to the Oldham Village Development owner/developer in agreements between MHTC and owner/developer.
As a condition of the property conveyance between MHTC and Oldham Village Development, the City must accept ownership of relocated Oldham Road and the part of Oldham Road between Allendale Blvd. and relocated Oldham Road. The Road Relinquishment Agreement relinquishes that part of Oldham Road between Allendale Blvd. and relocated Oldham Road from MHTC (MoDOT) to the City. The Road Maintenance Agreement provides security to the City for executing the Relinquishment Agreement prior to the time that the City Council has approved the other applications for the Project.
Proposed City Council Motion:
I move for second reading of An Ordinance Approving the Road Relinquishment Agreement with the Missouri Highways and Transportation Commission, and a Road Maintenance Agreement With Oldham Investors, LLC, to Facilitate the Oldham Village Redevelopment Project.
Background:
On May 14, 2024, the City Council heard a conceptual presentation from Oldham Investors, LLC, which is a single purpose entity created by Drake Development. Inc. (“Developer”) to pursue the Oldham Village project, consisting of numerous types of incentives for the redevelopment project, and thereafter the Council provide positive non-binding feedback to Developer regarding the incentive request.
On September 10, 2024, the City Council approved an ordinance which approved a Real Estate Sale Agreement between Oldham Investors, LLC, the subsidiary of Developer, and the City for the purchase of approximately 8.5 acres of property by the City for the placement of a fieldhouse to be constructed and operated by the Lee’s Summit Parks and Recreation Department, as a component of the Oldham Village Redevelopment Project (the “Project”).
Developer has requested that the City approve a Road Relinquishment Agreement with the Missouri Highways and Transportation Commission (“MHTC”) to facilitate the realignment of Oldham Road and other roads within the Project. The City Council has been requested by Developer to consider and act on the Road Relinquishment Agreement prior to the date that the Council considers the zoning and incentive applications for the Project in order to facilitate MHTC’s timely consideration of the same agreement at the MHTC November 2024 meeting.
City staff has negotiated a Road Maintenance Agreement with Developer to provide multiple forms of security to the City in exchange for executing the Road Relinquishment Agreement prior to the date that the City Council takes other potential actions for rezoning and incentives for the Project.
Impact/Analysis:
The Road Relinquishment Agreement will cause MoDOT to transfer approximately 0.226 acres of Oldham Road to the City, potentially before the requested rezoning and incentive applications for the Project are acted upon by the City Council. As an accommodation to Developer, the City is considering this agreement prior to other City Council approvals.
The Road Maintenance Agreement will provide the following forms of security to the City:
1. Initial Security. Developer will initially post security in an amount to cover the City’s anticipated cost associated with maintenance of the City Relinquished Roadway, which is estimated at $185,000. This security will be in the amount of $185,000, which has been calculated to cover one 20-year life-cycle of the City Relinquished Road. This security instrument will be provided to the City concurrently with the execution of the Maintenance Agreement. This security instrument or, any replacement security, shall be a letter of credit, performance bond, or other instrument acceptable to the City Attorney. Such security instrument shall specify the term and conditions under which the security may be drawn upon to complete the designated improvements.
2. Second Security. Developer will post the second security in an amount to cover the City’s anticipated cost associated with maintaining the Developer Relinquished Road pursuant to an agreement between Developer and MHTC. This security will be in the amount of $200,000, which has been calculated to cover one 20-year life-cycle of the Drake Relinquished Road. This security instrument shall be provided to the City in final binding form prior to the time that Developer takes title to the Drake Relinquished Road from MoDOT. The same terms and conditions specified above apply to this security instrument.
3. Security to record Final Plat. It is anticipated that, if the Project receives favorable approvals from the City and Developer elects to proceed with the Project, then security for the Oldham Road relocation project, which is anticipated to occur as part of the overall Project, shall be provided in accordance with the requirements of the City’s Unified Development Ordinance prior to recording the final plat for the Project, or prior to the recording of the first final plat.
The cost estimates used on the agreement by the City for the amount of the security is based on the Capital Cost Detail (for Commercial Collector) from the Fiscal Impact Model for New Construction and the O&M of Capital Growth Detail (for Collector for Street Maintenance & Snow Maintenance ONLY) from the Fiscal Impact Model.
Timeline:
The rezoning and incentive applications are expected to be before the City Council in November or December 2024. The project will be implemented starting in 2025, with possible demolition in later 2024.
Other Information/Unique Characteristics:
The Road Maintenance Agreement is a unique agreement to facilitate developer’s request.
Presenter
David Bushek, Chief Counsel of Economic Development & Planning
Michael Park, Director of Public Works
Recommendation
Recommendation: Staff recommends approval of the agreements.