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CITY COMMISSION AGENDA ITEM |
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Department: |
City Manager’s Office |
Commission Meeting Date: June 5, 2018 |
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Staff Contact: |
Diane Stoddard, Assistant City Manager |
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Recommendations/Options/Action Requested: |
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Authorize the City Manager to enter into a reimbursement agreement with KCI Lawrence 153, LLC (VanTrust Real Estate) regarding the extension of a natural gas main in Lawrence VenturePark to serve the VanTrust project and future industrial development within Lawrence VenturePark. |
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Executive Summary: |
VanTrust Real Estate/KCI Lawrence 153, LLC is currently constructing the first phase of a planned three-phase development in Lawrence VenturePark. With the establishment of the industrial park, City infrastructure (streets, water, sewer, storm water) was provided within the Park. However, the VanTrust project has triggered the need for natural gas service within the Park. The nearest Atmos Energy gas main is located in East Hills Business Park, east of Lawrence VenturePark. VanTrust’s projects are located on the far west portion of Lawrence VenturePark. The gas main must be extended approximately 4,400 feet. The cost of the gas main is estimated to be between $75,000 and $100,000. It would not be fair to have the VanTrust project shoulder all of the burden for this extension that will serve all of the property between VanTrust’s project and East Hills Business Park.
Staff is proposing that the City participate in the cost of the natural gas main extension, and then spread the City’s share over the remaining real estate in VenturePark. Under the agreement, the City would share by being responsible for 2/3 of the actual cost of the main extension, to a maximum of $55,000. The $55,000 would be spread over the other real estate in VenturePark in the same method as the special assessments were spread for the City infrastructure. This would add to the future costs that the City would need to discuss with prospective future purchasers of that property. Like special assessments, these costs would be part of the overall negotiation on future projects and become the responsibility of future owners of the tracts, unless those costs are waived as part of an incentive agreement. VanTrust would be responsible for the remainder 1/3 of the costs, or any amount over the City’s $55,000 share. VanTrust’s participation would cover all three phases of their proposed development, whether or not the second or third phases proceed. VanTrust is currently constructing its first phase on Block B Lot 1, with the second and third phases planned for Block B Lot 2 and the grouping of Block A lots. VanTrust would still be responsible for bringing in the natural gas service from the main to the building for these phases.
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Strategic Plan Critical Success Factor |
Collaborative Solutions Economic Growth and Security |
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Fiscal Impact (Amount/Source): |
The fiscal impact to the City is a maximum of $55,000. This amount was not specifically budgeted. However, $60,000 is budgeted in 2018 in the Capital Reserve Fund for a facility master plan. Staff does not anticipate those funds being needed in the 2018 year and suggests those costs could be planned in the 2019 budget as the facility master plan is still a priority project and a strategic plan goal. |
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Attachments: |
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Reviewed By: (for CMO use only) |
☐TM ☒DS ☐CT ☐BM |