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083-13 - The Sinclair, LLC - Contract Amendment 1February 3, 2015 FIRST AMENDMENT TO DEVELOPMENT AGREEMENT BY AND BETWEEN THE CITY OF PORT ORCHARD AND THE SINCLAIR, LLC FOR THE SOUTHWEST SIDNEY PLAZA DEVELOPMENT THIS FIRST AMENDMENT TO THE DEVELOPMENT AGREEMENT which was executed on October 22, 2013 (hereinafter the "Development Agreement"), is made on the It:) day of t ; 2015 by and between the City of Port Orchard, a Washington municipal corporate , hereinafter the "City," and The Sinclair, LLC, a limited liability corporation, organized under the laws of the State of Washington, hereinafter the "Developer." RECITALS WHEREAS, the "Development Agreement' relates to the mixed use development known as Southwest Sidney Plaza, which is to be constructed on property located at the southwest corner of the Sedgwick/Sidney Road intersection in Port Orchard (hereinafter the "Southwest Sidney Plaza Development' or "Development'); and WHEREAS, the Southwest Sidney Plaza Development includes 14,000 square feet of retail space, nine apartment buildings and a recreation center; and WHEREAS, in the Development Agreement, the Developer agreed to construct and after City inspection and approval, dedicate to the City without cost, for ownership and maintenance, a new sewer force main and Pottery Lift Station (all as set forth in sections 12.8 and 12.9 of the Development Agreement) to serve the Development; and WHEREAS, the City agreed to provide the Developer a credit per equivalent residential unit (ERU) as allowed under the current code against the sewer capital facilities charge for the cost of the design, engineering and construction costs of the sewer facilities that the Developer will construct and dedicate to the City, as limited by Section 12.9.5 of the Development Agreement; and WHEREAS, the parties agreed to this ERU credit against the sewer Capital Facilities Charge at a time when construction of the pump station and nine apartment buildings was taking place, and the total cost of the sanitary sewer pump station was not known; and FIRST AMENDMENT to the Development Agreement Re: Southwest Sidney Plaza Page 1 of 9 WHEREAS, if the City had known that the total cost of the sanitary sewer pump station would exceed the maximum sewer Capital Facilities Charge cost allowed, the City could have instead credited the Developer one hundred percent (100%) of the Capital Facilities Charge per building permit; and WHEREAS, the Developer has paid the applicable Capital Facilities Charge for the nine apartment buildings (changed to ten apartment buildings with no increase in the number of units), and the full amount was collected by the City at a rate of $6,359.18 ERU; and WHEREAS, the parties desire to enter into this First Amendment to the Development Agreement in order to address the actual costs and an accounting for the future credit for the Capital Facility Charge or reimbursement of this Charge, related to the 17,000 square feet of the retail space, which has not yet been fully constructed; and WHEREAS, the Port Orchard City Council provided public notice and held a public hearing on this First Amendment to the Development Agreement on February 10, 2015; Now, therefore, the parties hereto agree as follows: GENERAL PROVISIONS Section 1. Amendment to Section 12. Section 12 of the Development Agreement shall be amended to read as follows: 12. Financing and Construction of Sewer Improvements. 12.1 Certificates of occupancy for the Project will not be issued until additional sanitary sewer infrastructure, consisting of a new lift station and appurtenances (collectively, the "Pottery Lift Station Facility" and individually, the "Pottery Lift Station") and a connection to an existing force main and pump station have been constructed and inspected and accepted by the City. The City has determined that the appropriate location for the proposed Pottery Lift Station Facility is on property owned by South Kitsap School District No. 402 located at the Cedar Heights Junior High School (Cedar Heights School), 2220 Pottery Avenue, Port Orchard, as legally described and depicted in Exhibits A, B, and C to Attachment 2. 12.2 The School District has granted a sanitary sewer easement to the City, Kitsap County Auditor's No. 201307150243, for the purpose of constructing, reconstructing, installing, repairing, replacing, operating and maintaining a sewer pump station, gravity sewer lines, and associated appurtenances, together with right FIRST AMENDMENT to the Development Agreement Re: Southwest Sidney Plaza Page 2 of 9 of ingress and egress thereto. A copy of said easement is attached hereto as Attachment 2. 12.3 Developer agrees to finance and construct the sewer force main connection and the Pottery Lift Station in accordance with the terms and conditions set forth in this Section 12. 12.4 Developer agrees to pay all costs of design, engineering, and construction to extend the existing gravity sewer line at the Albertson's Pump Station westward beneath Sidney Road SW and across the Subject Property to the northwest corner of the Subject Property at Sedgwick Road SW for future use by Developer and/or others. 12.4.1 All construction shall be done to City standards and according to plans approved by the City's Public Works Department and City Engineer. Any and all costs incurred by the City in reviewing plans and inspecting construction shall be paid for by the Owner. 12.4.2 The Albertson's Pump Station has sufficient pump capacity and force main capacity to receive Developer's effluent. However, minor modifications and/or repair may be required. Developer shall provide the City with a written assessment of the suitability of the Albertson's pump station to receive Developer's additional effluent and agrees to make, at its sole cost, such minor modifications or repairs as are necessary for full functionality. The City and it's consultants agree to provide to the Developer all available operation and maintenance records; operational data, pump station plans, flow modeling analysis reports completed to date; or other documentation that will allow for the written assessment of the Albertson's pump station. 12.5 Developer shall pay all costs of designing, engineering and constructing the Pottery Lift Station Facility. All construction shall be done to City standards and according to plans approved by the City's Public Works Department and City Engineer. Any and all costs incurred by the City in reviewing plans and inspecting construction shall be paid for by the Owner. 12.6 Developer shall prepare the design documents required for the Pottery Lift Station in accordance with the City's specifications and the following requirements: 12.6.1 The Pottery Lift Station and the improvements within the Easement shall be generally located as shown on Exhibits B and C to Attachment 2 and shall be: (1) located in the north section of the Easement approximately 40 feet x 120 feet) so as to maximize a parking layout (as set forth below FIRST AMENDMENT to the Development Agreement Re: Southwest Sidney Plaza Page 3 of 9 under Section 12.7) for the benefit of the School District and enclosed by a minimum 5 foot slatted chain link fence and landscaped around the perimeter of the fenced Lift Station as approved by the City in coordination with the School District; and (ii) designed with two gated entrances that are aligned with drive aisles in the parking lot to be constructed within the southern section of the Easement. 12.7 Developer shall prepare and submit to the City a Parking Lot Plan (which shall include the above -identified items under Section 12.6.1) to be approved by the City and the School District within a reasonable period of time following submittal of such Parking Lot Plan and which approval shall not be unreasonably withheld. The Parking Lot Plan shall include but not be limited to the following specifications: 12.7.1 The Parking Lot shall be located within the Easement and shall be approximately 120 feet x 120 feet in size as generally shown on Exhibit B to Attachment 2. 12.7.2 The Parking Lot shall be properly graded (for stormwater runoff) and a base course shall be placed thereon at such depth as is required by the City in consultation with the School District in the exercise of its reasonable discretion, inclusive of rip rap and 3/4" minus. 12.7.3 The Parking Lot will be paved with HMA pavement at such depth as is required by the City in consultation with the School District in the exercise of its reasonable discretion. Parking stalls shall be striped and wheel stops installed. 12.8 Construction of the Pottery Lift Station and Parking Lot (the Work) shall begin after the Developer receives the necessary approvals and permits from the City and after the School District has approved the Parking Lot Plan. The School District has requested that the Work be performed during those periods when students are not present at Cedar Heights School. However, if this is not feasible due to the Developer's development schedule, then the Work shall be performed at such other times as agreed upon between the School District and the Developer in the exercise of the School District's reasonable discretion. Prior to commencement of the Work, the Developer shall provide the District with not less than fourteen (14) days' advance notice in accordance with Section 24 below and the Developer shall make its bests efforts to coordinate a pre -construction meeting with the School District and the City. The Work, including the Parking Lot, shall be guaranteed by the Developer for the Maintenance Period required under the City's development regulations. FIRST AMENDMENT to the Development Agreement Re: Southwest Sidney Plaza Page 4 of 9 12.9 Developer agrees to turn over and dedicate the new sewer force main and Pottery Lift Station Facility to the City, at no cost, upon the completion of construction and approval and acceptance of the same by the City. As a prerequisite to such turn over and acceptance, Developer will furnish to the City the following: 12.9.1 As built plans or drawings in a form acceptable to the City Public Works Department and City Engineer. 12.9.2 Any necessary easements, permits or licenses for the continued operation, maintenance, repair or reconstruction of such facilities by the City, in a form approved by the City Attorney. 12.9.3 A bill of sale in a form approved by the City Attorney; and 12.9.4 A bond or other suitable surety in a form approved by the City Attorney and in an amount approved by the City Engineer, ensuring that the facilities will remain free from defects in workmanship and materials for a period of two (2) years. 12.9.5 At the time the Development Agreement was executed, POMC 13.04.040, allowed the Developer a credit against the sewer capital facilities charge, which the Developer has now paid. The amount of the credit equals the design, engineering and construction cost of the sewer facilities, or, the regional pump station, that Developer has constructed and dedicated to the City; provided however, the amount of the credit shall not exceed the amount of the sewer capital facilities charge for the Project to which the credit is being applied. Notwithstanding the foregoing, Developer shall be responsible for payment of all applicable permit and inspection fees, as provided by Code. The Developer has identified, and the City has agreed, that the total allowable cost for the regional pump station is One Million, Fifty -Six Thousand and Ninety - Six Dollars and Ninety -Five Cents ($1,056,096.95). Therefore, the Developer is now entitled to a credit, in the form of reimbursement, up to the amount of sewer capital facilities charge paid by the Developer for the apartment phase of the project. The Developer is also entitled to a credit of the sewer capital facilities charge required for the future retail building phase of the project. However, the said credit for the retail building shall not exceed the difference between the amount paid by the Developer in sewer capital facilities charge for the apartment phase and the cost of the regional pump station. For the retail building phase of the project, the Developer may either choose to have a credit against the Capital Facilities Charge related to future construction of the retail space, according to the FIRST AMENDMENT to the Development Agreement Re: Southwest Sidney Plaza Page 5 of 9 terms of the Development Agreement, or be reimbursed for the sewer capital facilities charge it pays for a new retail building. 12.9.6 Should the costs of the improvements required under this agreement (Albertson's Pump Station upgrades, if required, and the design, engineering and construction of the Pottery Lift Station) be greater than the amount of credit against sewer capital facilities charge the Developer is entitled to under POMC 13.04.040, nothing in this Agreement shall preclude the Developer from setting up a latecomers agreement for the amount exceeding said credit. Provided, however, the property owned by South Kitsap School District No. 402 at 2220 Pottery Avenue, Port Orchard, Kitsap County parcel no. 032301-1-011-2000, and commonly referred to as Cedar Heights Junior High School, shall be exempt from any latecomer's agreement established by the Developer to recover costs incurred under this Development Agreement. Section 2. All Other Provisions of Development Agreement to Apply. This First Amendment only amends the portions of the Development Agreement identified in Section 1 herein, and the parties agree that all other provisions of the Development Agreement shall remain are in full effect and validity. This First Amendment does not extend the date for expiration of the Development Agreement (in Section 7 of the Development Agreement). Section 3. Covenants Running with the Land. The conditions and covenants set forth in this First Amendment to the Development Agreement are incorporated herein, and shall run with the land. The benefits and burdens of this First Amendment to the Development Agreement shall bind and inure to the benefit of the parties. The Developer, Landowner.and every purchaser, assignee or transferee of an interest in the Subject Property, or any portion thereof, shall be obligated and bound by the terms and conditions of this First Amendment to the Development Agreement and the Development Agreement, and shall be the beneficiary thereof and a party thereto, but only with respect to the Subject Property, or such portion thereof, sold, assigned or transferred to it. Any such purchaser, assignee or transferee shall observe and fully perform all of the duties and obligations of a Developer contained in this First Amendment and the Development Agreement, as such duties and obligations pertain to the portion of the Subject Property sold, assigned or transferred to it. FIRST AMENDMENT to the Development Agreement Re: Southwest Sidney Plaza Page 6 of 9 IN WITNESS WHEREOF, the parties hereto have caused this Development Agreement to be executed as of the dates set forth below: CITY OF PORT ORCHARD: By',-,/�.e� Z142&� Timothy C. Mat es Its: Mayor Date: 92 1 - 1-5 ATTEST: By: Brandy Rinearson, City Clerk APPROXSV S TO FORM: RIle BY:C> •° ORP 'T��'% CaVQI Morris,�nte•ricity A v' SOH I1N,G����� THE SINCLAIR, LLC BY: �� Print Name: Gordon Rush Its: Managing Me b7/. Date: FIRST AMENDMENT to the Development Agreement Re: Southwest Sidney Plaza Page 7 of 9 STATE OF WASHINGTON ) ) ss. COUNTY OF KITSAP On this day personally appeared before me Timothy C. Matthes to me known to be the Mayor of the City of Port Orchard, the municipal corporation described in and that executed the within and foregoing instrument, and acknowledged that he signed said instrument to be the free and voluntary act and deed of said municipal corporation, for the uses and purposes therein mentioned, and on oath stated that he was authorized to execute said instrument on behalf of said municipal corporation. GIVEN under my hand and official seal this 0 day of _ 2015. �O-TARY PUBLIC in and for the State of Washington, residing at Print NameaEn r nP 1-1Qya �---X- My appointment expires: 11�� • 1�- FIRST AMENDMENT to the Development Agreement Re: Southwest Sidney Plaza Page 8 of 9 STATE OF WASHINGTON ) ss. COUNTY OF PIERCE ) On this day personally appeared before me Gordon Rush to me known to be the Managing Member of The Sinclair, LLC , the corporation described in and that executed the within and foregoing instrument, and acknowledged that he signed said instrument to be the free and voluntary act and deed of said corporation, for the uses and purposes therein mentioned, and on oath stated that he was authorized to execute said instrument on behalf of said corporation. GIVEN under my hand and official seal this 3`d day of February , 2015. r 40TARy : p N-: 0*.410 PU B FIRST AMENDMENT to the Development Agreement Re: Southwest Sidney Plaza Page 9 of 9 NOTARY aLIC in and fo e State of Washington, residing at 0� a�w Print me: hR'j✓)W 4 My appointment expires: -7" M -13