DOWNTOWN DEVELOPMENT AUTHORITY (DDA) July 2, 2018 MT. CRESTED BUTTE, CO AGENDA
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3 DOWNTOWN DEVELOPMENT AUTHORITY (DDA) July 2, 2018 MT. CRESTED BUTTE, CO 4:00 PM REGULAR MEETING Council Chambers Call To Order AGENDA Roll Call Approval of the May 7, 2018 Downtown Development Authority Meeting Minutes Reports Correspondence UNFINISHED BUSINESS- Crested Butte Way Update Skier Drop Off Update Nordic Inn Property PUD Update NI-2, ROS-1 Land Purchase Option Agreement NEW BUSINESS Discussion and Possible Consideration of TC-1 Recreation Path Stair Access OTHER BUSINESS ADJOURN If you require any special accommodations in order to attend this meeting, please call the Town Hall at at least 48 hours in advance of the meeting. This preliminary agenda is placed in the paper to notify the public of tentative agenda items for the meeting date above. The official posting place for the agenda is the bulletin board in the Mt. Crested Butte Town Hall entry. Please refer to that official agenda for actual agenda items for the meeting date noted above.
4 DOWNTOWN DEVELOPMENT AUTHORITY (DDA) May 7, 2018 MT. CRESTED BUTTE, CO 4:00 PM REGULAR MEETING Council Chambers Call To Order 4:05pm Roll Call Present Jamie Watt Gary Keiser David Clayton Todd Barnes Janet Farmer Allen Cox Absent Michael Kraatz Others present Aaron Huckstep, Chris Hensley, Allison Butcher, Ken Lodovico, Joe Fitzpatrick and Tiffany O Connell. Approval of the March 5, 2018 Downtown Development Authority Meeting Minutes Motion: David Clayton made a motion to approve the March 5, 2018 DDA Meeting Minutes. Todd Barnes seconded the motion. Janet Farmer and Allen Cox abstained as they were not at the meeting. With no further discussion the motion passed unanimously. Reports Adaptive Sports Center Update Chris Hensley began with discussion with a short video of the old building coming down. He said they started the demo work on April 25 th. They are now working on the utilities. They hope to have the hole dug in mid to late June. They also hope to not run into any unexpected issues and to stay on budget for the excavation. If they do stay on budget they will have a better idea as to the final cost of the building. They are planning on 13 months of construction. Allison Butcher said that they have raised $12.4 million. Once they raise a bit more they are planning on reaching out to a few donors to help them with a $500,000 matching challenge. They are also applying for a grant in the amount of $150,000. They will hear about the grant at the end of the summer. Chris Hensley and Allison Butcher mentioned two possible naming opportunities for the DDA and their contribution. They would love to have a plaque by the two-story rock climbing wall as this will be a huge focal point. But another option is the roof top event space. Chris Hensley is also asking donors to accelerate their pledges in order to help reduce the cost of financing a bridge loan. They will be apply for a loan with Community Banks of Colorado. Chris Hensley said that the first DDA payment is due within the next month. Gary Keiser said it is actually due 90 days from ground breaking, so at the end of July. Chris asked if the DDA could accelerate that payment. Janet Farmer said that the DDA will have to speak with Karl Trujillo. Crested Butte Way Update Joe Fitzpatrick began this update by saying that the demo work is complete on Crested Butte Way ( CB Way ) and the retaining wall by the Avalanche is complete. We are waiting on an easement from the Emmons Homeowners Association as part of CB Way is on their property. We are also waiting on the final drawings from SGM. They had to wait on the final grades before they could finish their drawings. This project is expected to be
5 DOWNTOWN DEVELOPMENT AUTHORITY (DDA) May 7, 2018 MT. CRESTED BUTTE, CO 4:00 PM REGULAR MEETING Council Chambers completed in early June. CBMR is expecting record number guests in June with a large convention coming in on June 2 nd. Joe Fitzpatrick is pretty sure the final cost will be close to $400,000. We added in an additional boiler just in case the other boiler breaks down. We will also need an agreement with the Town Center Association regarding using this boiler. Skier Drop Off Joe Fitzpatrick began this discussion by saying that so far, we have made no progress. SGM is swamped with the Nordic Inn drawings, Maintenance Building, Roads, Wedding Garden Update, etc. It is on the list and they will get to it as soon as possible. Emmons Traffic Discussion Joe Fitzpatrick said that this summer we are going to have delivery trucks using the transit loop for deliveries. It will cause issues with Mountain Express but we want to try this in the summer when there are less buses running. We are also creating a skier drop off where 1½ parking currently is. 1½ hour parking will lose a few spots. Finally, we will be placing a control shack and gate on Emmons Road by the entrance to CBMR s parking lot. You will only be allowed to go down Emmons Road if you have a reason. Nordic Property PUD Update Gary Keiser started this discussion with a quick history of the project. Summer 2016 Mt. Crested Butte Performing Arts Center needed to find about 150 parking spaces. Around that time the Nordic Inn was under contract with Pearls Management, LLC. The Pearls met with the Town regarding what is now NI2 for parking. On April 3, 2017 the DDA approved the contract to purchase NI2 to be used for a parking lot and the Town Council approved that contract as well. The Town Council tabled the Nordic Inn PUD discussion until May 15 th due to the neighborhood objections. The Town Council has talked about purchasing the property and using it for something else. Gary spoke with the DDA members about whether they would like to still purchase the land but use it for something else. Todd Barnes asked do we want to purchase the property and use it for something else landbank it for now. He also said that the Council wants to let this issue settle down for now and then start over later with the Town as the only applicant. The people do not want this and the Council is listening to them. Todd Barnes said that they public is good with the Pearls expanding their property but they do not want a parking lot, do not want a change in traffic, do not want the additional lighting. David Clayton commented that we could put in affordable housing instead but the neighbors will not like that either. Todd Barnes also said that public does not like the buyback option. Joe Fitzpatrick reminded the DDA that for the land to be included in the DDA the owner has to request it but the owner has stated that if the PUD is not approved they will not be requesting that. Todd Barnes said that the Council would like to purchase the property, eliminate the purchase agreement and then decide what to do with the lot.
6 DOWNTOWN DEVELOPMENT AUTHORITY (DDA) May 7, 2018 MT. CRESTED BUTTE, CO 4:00 PM REGULAR MEETING Council Chambers Joe Fitzpatrick said that he did reach out to the owners of Lot Site 17 (Snowmass Lot) to see if they would be willing to sell the lot. They said that they are not interested in selling the lot and they are also looking at increase the lease payment a substantial amount. The lease is currently costing us $1,000 per month. Aaron Huckstep said that the owners are not interested in starting over with a brand-new PUD at this point. Aaron Huckstep said that they are willing to make changes or amend the PUD. If the parking lot is not going to work they will install a five-story building on that lot and that will not make the neighbors happy ether. No matter if you say yes or no to this PUD you will not be making everyone happy. Gary Keiser said another option would be that the Town Council could approve the PUD as is but delay construction until approved by the Town Council. Janet Farmer said she would like to take the buyback option piece out. Joe Fitzpatrick said that if you took this out then you would have to go back to the Planning Commission and the Town Council with public hearings. This will delay everything at least two months. Gary Keiser asked why does the DDA want to buy a piece of land and not do anything with it? David Clayton asked why would the DDA want to pay for 5 townhomes? He is against land banking the property. Gary Keiser said that there is no money from the DDA to build affordable housing. Todd Barnes said the Town Council was trying to figure out what the neighbors want. We need to find a solution and move forward. Maybe in the future a small parking lot might work. Gary Keiser asked if the DDA would be willing to fund the purchase for anything other than a parking lot. David Keiser stated that the DDA must fund projects that are an economic benefit to the Town and land banking does not meet this category. Allen Cox asked about the unfinished parking structure. Gary Keiser said that at completion the parking structure would add an additional 200 spots but at a cost of 6 to 8 million, which the DDA does not have. Plus, the current parking structure was not built to have additional stories and more structural work will need to be done. Todd Barnes said that benefits CBMR not so much the Town. It is hard to fund a project that will benefit a private entity. Aaron Huckstep said that a middle ground might be able to finalize the purchase but not build the parking lot until x date in the future. This buys the Town Council time to consider any other options.
7 DOWNTOWN DEVELOPMENT AUTHORITY (DDA) May 7, 2018 MT. CRESTED BUTTE, CO 4:00 PM REGULAR MEETING Council Chambers Jamie Watt made a comment that this is very frustrating. The neighbors are so concerned about the huge traffic increase because of the parking lot. Jamie Watt has been living in Ponderosa for a year now and there is no issue with traffic. The neighbors will always be not in my back yard. The Council needs to look at is this better for the Town or not. David Clayton like the idea of approving the PUD and slow down the parking lot. The neighbors have their input to the process but they are not allowed to control it. Jamie Watt said that these owners are controlling it. David Clayton agreed. Aaron Huckstep said that the DDA could consider putting a moratorium on the parking lot, or do it in phases. Some now and some later. Joe Fitzpatrick said that the lot is small enough that if you break it into phases you will be spending more money overall. The retaining wall is a major expense. Gary Keiser asked where we are on costs for this project. Joe Fitzpatrick said that the land is costing $1,050,000 and then $809,000 for infrastructure. About $14,000 per space. Gary Keiser said that if we expanded the Rasta Lot and put a two-story parking structure there it will cost about $45,000 per space and to finish the existing parking structure is will cost about $60,000 per space. Janet Farmer said that she is not convinced that we need any parking right now. Jamie Watt likes the idea of keeping the option open for three years or even five years. Do not build the parking lot yet. Gary Keiser said that the DDA cannot make this decision but they can write a letter to the Town Council with what they would like to see done. Janet Farmer again said that she does not see the need for a parking lot. tax. David Clayton said that a new hotel bring money to the Town in property taxes and sales Motion: David Clayton a motion to write a letter to the Town Council from the Downtown Development Authority Board and Gary Keiser will sign it as Chairman. The letter will state the following: 1. The DDA supports a140 space parking lot on NI2. The DDA will not support any other uses of this lot, except Phase III of the Nordic Inn PUD. 2. The DDA is acceptable to delay the construction of a parking lot until the Town Council determines that it is needed. 3. The DDA recommends that the option agreement needs to be modified to address the following possibilities: a. Town builds a parking lot; b. Town does not build a parking lot; and
8 DOWNTOWN DEVELOPMENT AUTHORITY (DDA) May 7, 2018 MT. CRESTED BUTTE, CO 4:00 PM REGULAR MEETING Council Chambers c. Town buys out the option agreement. Jamie Watt seconded the motion. Janet Farmer and Todd Barnes abstained from voting. The balance of the DDA approved the motion. It passed unanimously. ADJOURN David Clayton made a motion to adjourn the meeting. Janet Farmer seconded the motion. The motion passed unanimously. The meeting was adjourned at 6:14pm. Gary Keiser, Chair Tiffany O Connell, Recording Secretary
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12 EXHIBIT A OPTION AGREEMENT THIS Option Agreement is entered into effective the day of June, 2018, by and between the Town of Mt. Crested Butte, Colorado, a Colorado home-rule municipality ("Town") and The Pearls Management, LLC, a limited liability company ( Pearls"). RECITALS: I. The Town is the purchaser of the following real property located in the Town of Mt. Crested Butte, County of Gunnison, Colorado, described below, prior to PUD approval and subdivision: LOT 3 & ADJ VAC CUL-DE-SAC BLK D REPLAT BLK D CHALET VILLAGE ADDN PLAT #620880, and LOTS 1,2 & ADJ VAC CUL-DE-SAC BLK D REPLAT BLK D CHALET VILLAGE ADDN PLAT #620880, and LOT 1 BLK C CHALET VILLAGE 1 # known as No. 18, 22, 24 Treasury Road, Mt. Crested Butte, CO 81225, including all improvements and any fixtures located on the Property now or in the future ("Property") Which is now described as Lots NI-2 and ROS-1 following PUD and lot line vacation and boundary line adjustment approval by the Town of Mt. Crested Butte Town Council. 2. In connection with its sale of the Property to Town, Pearls desires to maintain an option to repurchase the Property upon such terms and conditions as agreed between the parties, to allow for further development of the Property and adjoining real property owned by Pearls. 3. The parties have entered into this Option Agreement to meet condition 3. of Paragraph 30 of the Contract to Buy and Sell Real Estate dated April 21, 2017 ("Contract") as well as the directives of the Town Council of the Town of Mt. Crested Butte as stated in its May 15, 2018, Meeting Minutes. NOW, THEREFORE, for good and valuable consideration herein expressed, the parties agree as follows: 4. For a period of 60 months from the date of Closing of the Contract, the Town grants Pearls the right to purchase the Property from Town ("Option Term") upon the terms and conditions set forth herein. 5. Pearls shall exercise the Option by delivering written notice thereof to Town at the address stated below: Town of Mt. Crested Butte 911 Gothic Road Page 1 of 5
13 P.O. Box 5800 Mt. Crested Butte, CO PARKING LOT CONSTRUCTION. In the event that the Town has constructed a public surface parking lot on the Property at the time Pearls exercises this Option, the terms of the Option shall be as follows: a. The Option Purchase Price under this paragraph 6 shall be $50,000 in good funds payable at closing. b. Upon exercise of the Option, Pearls agrees to replace an equal amount of parking spaces on the Property as exist at the time Pearls exercises the Option (the Replacement Spaces ). The Replacement Spaces shall be solely for the Town s benefit. The Replacement Spaces shall be in addition to any parking spaces Pearls is required to provide for any development activity on the Property. c. The Replacement Spaces shall be maintained in accordance with the landscaping and lighting design requirements established by the Town of Mt. Crested Butte during its design review process associated with the initial construction of the parking spaces. The Replacement Spaces shall be governed by rules and regulations adopted by the Town of Mt. Crested Butte during its design review process associated with the initial construction of the parking spaces. d. Pearls shall provide maintenance services and cooperate with the Town to minimize disruption during construction of any new parking structure or parking facilities after the Option Closing. The parties shall enter into a Parking Facility Agreement addressing the issues contained in this paragraph prior to the Option Closing. The Parking Facility Agreement shall not require Pearls to provide the parking spaces set forth herein during the time of construction of any new improvements on the Property. The Parking Facility Agreement shall allow Pearls a commercially reasonable timeframe following the completion of construction of any new improvements on the Property to provide a parking garage or surface parking to meet Pearls obligation hereunder. 7. NO CONSTRUCTION. In the event that the Town has not constructed any improvements on the Property at the time Pearls exercises this Option, the terms of the Option shall be as follows: a. The Option Purchase Price under this paragraph 7 shall be $1,050,000 in good funds payable at closing. b. In the event Pearls exercises the Option under this paragraph 7, Pearls development of the Property shall not require providing any parking spaces to the Town, or for the Town s benefit, except those which are associated with development activity on the Property. If Page 2 of 5
14 Pearls has provided all required parking spaces for the development activity on the neighboring lot NI-1, no additional parking spaces will be required on NI OPTION TERMINATION. In the event that the Town determines that it is no longer interested in using the Property for the purpose of a surface parking lot, or that it wishes to terminate this Option for any reason or no reason at all, the Town may terminate this Option pursuant to this paragraph 8. a) The Town shall deliver to Pearls written notice of the Town s election to terminate (the Termination Notice ). The Town s actual termination shall not be effective until the passage of ninety (90) days following the date of delivery of the Termination Notice (the Effective Termination Date ). On or before the Effective Termination Date, the Town shall deliver to Pearls the sum of Two Hundred Thousand Dollars ($200,000) (the Termination Fee ). The Effective Termination Date shall be automatically extended beyond ninety (90) days from the Termination Notice date until Pearls has received the Termination Fee. If the Termination Fee has not been received within one hundred (100) days of the Termination Notice date, the Termination Notice shall be deemed defective and void ab initio. b) In an effort to mitigate any damages associated with the Town s potential termination, Pearls shall notify the Town in writing at least ninety (90) days prior to taking any material steps (including the expenditure of monies) towards the development of Phase III of the Nordic Inn PUD (the Development Notice ). No Development Notice shall be effective if the Town has already delivered a Termination Notice to Pearls, unless and until the Termination Notice has been deemed defective and void ab initio pursuant to paragraph 8.a. above. c) If no Termination Notice has been received by Pearls from the Town within thirty (30) days from the date of the Development Notice, the Town s right to terminate this Option pursuant to this paragraph 8 shall become null, void, and of no further force or effect. 9. In the event that the Town determines that it is no longer interested in using the Property for the purpose of a surface parking lot, any new development proposal for residential or commercial uses must proceed for approval as a major alteration to the Nordic Inn Planned Unit Development. In that event, the Town must either terminate this Option pursuant to paragraph 8 above, or negotiate an amendment to this Option agreement contingent upon approval of the newly-requested end uses. 10. Pearls may extend the Option Term for 24 months (the Option Term Extension ) at its sole discretion by providing written notice to the Town on or before the end of the Option Term. Page 3 of 5
15 11. A current commitment for a title insurance policy in an amount equal to the Option Purchase Price shall, at Town's expense, be furnished to Pearls upon exercise of the Option under paragraph 6 or 7 of this Option Agreement. Town will deliver the title insurance policy to Pearls after closing on the Option and pay the premium thereon. 12. The Option Closing shall be set at a mutually agreeable date and time between the parties. All Closing costs shall be allocated between the parties pursuant to local custom. 13. At the time of the Option Closing, title to the Property shall be merchantable in the Town. Subject to payment as provided above and compliance by Pearls with notice provisions herein, Town shall execute and deliver a good and sufficient general warranty deed to Pearls conveying the Property free and clear, subject to general taxes for the year of closing and encumbrances of record as shown on the commitment for title insurance and accepted by Pearls. 14. If title is not merchantable and written notice of defect is given by Pearls to Town on or before seven (7) days of the issuance of the commitment for title insurance, Town shall use reasonable effort to correct said defect prior to closing. If Town is unable to correct said defect prior to closing, at Town's option and upon written notice to Pearls on or before date of closing, the date of closing shall be extended thirty days for the purpose of correcting said defect. 15. Any encumbrance required to be paid by Town may be paid at the time of the Option Closing from the proceeds of this transaction or from any other source. 16. Possession of the Property shall be delivered to Pearls at the Option Closing. 17. In the event Pearls fails to timely exercise this Option, then and in such event, Pearls shall cooperate with Town's reasonable requests to acknowledge termination of the Option, including but not limited to execution and delivery of a bargain and sale deed concerning the Property. 18. Right of First Refusal. If, during the Option Term or Option Term Extension, Town receives a bona fide written offer from an unrelated third party for the purchase of the Property, which offer the Town desires to accept, the Town shall provide notice of such offer to Pearls in writing at the address stated below. Pearls shall have ten (10) business days from the date of receipt of such notice to exercise its Option to purchase the property under the terms of the offer submitted to the Town by the third party. 19. Any notice, consent, approval or request which is required to be given hereunder shall be given by hand delivery or mailing the same, certified mail, return receipt requested, property addressed and with postage fully prepaid, to the address provided herein or the address below: To Town: Town of Mt. Crested Butte Page 4 of 5
16 Attn: Town Manager P.O. Box 5800 Mt. Crested Butte, CO Tel Fax To Pearls: The Pearls Management, LLC 490 Sawgrass Corporate Parkway, Suite 310 Sunrise, FL Tel. Fax 20. This document contains the entire agreement of the parties. All prior discussions and negotiations pertaining to this Option Agreement are merged into this document. TOWN OF MT. CRESTED BUTTE, COLORADO, A Colorado home-rule municipality By: Joseph W. Fitzpatrick, Jr., Town Manager Attest: By: Tiffany O Connell, Town Clerk THE PEARLS MANAGEMENT, LLC By: Its: Page 5 of 5
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