Title
A resolution authorizing the City Manager to finalize and execute a Master Developer Agreement regarding the development of approximately 60.31 acres of land generally located south of Gross Road, east of North Peachtree Road, north of the Union Pacific Railroad and west of Interstate Highway 635 in the City of Mesquite, Texas, and being commonly referred to the “Verde Center” or the “Verde Center at Peachtree” and authorizing the City Manager to administer the agreement on behalf of the City and specifically repealing Ordinance No. 79-2017.
Body
In 2008, the City of Mesquite entered into an agreement with Lang and Company for the development of property on the east side of Peachtree Road near the Skyline intersection. The property was acquired by the City following a failed development through the Resolution Trust Corporation in the early 1990s.
The initial agreement envisioned a commercial restaurant and hotel development on the property. The developer was responsible for placing the infrastructure on the property which would included a bridge over South Mesquite Creek which runs through the property. The roadway would connect Peachtree to a future frontage road along IH 635. The City participated in the project by funding trail improvements at a cost of $600,000 and essentially donating the property.
Following the downturn in the economy, the developer evaluated multiple options to encourage development on the property. In 2013, the developer focused efforts on a medical complex consisting of a wellness center and medical office facilities along with restaurant and commercial development. The State Legislature created a Medical Management District (MMD) in 2013 to support this concept. The project is now referred to as The Verde Center at Peachtree.
The MMD is a special district that is self-governed and is a political subdivision of the State of Texas. The MMD may levy taxes or assessments on property within the district, but does not replace the services provided by the City. The District may issue bonds that are supported by assessments from within the district. The bond debt does not impact the City’s bond rating.
In 2015, the City Council appointed members to the MMD and since that time, staff has been working to finalize a Master Development Agreement (MDA) with the developer to outline the financial structure of reimbursements provided to the district for economic development purposes. The developer is proposing $15 million in public infrastructure to facilitate improvements. The MDA is necessary for the project due to the large number of developers, contractors and lenders that will be required to design, construct and complete various improvements. The MDA also outlines the structure of reimbursements made to the MMD through the Skyline Tax Increment Finance Reinvestment Zone No. 7.
In December 2017, the City Council authorized the City Manager to finalize and execute the MDA. Since that time, revisions to the structure of the agreement have been made that significantly alter many of the terms of the agreement presented to the City Council. The City will continue to reimburse the developer for infrastructure related to this development, but the manner in which the funds will be handled are more clearly outlined in the new revision. The revision also includes a more detailed structure for operation of the MMD. Staff will provide a briefing on the MDA and the developer will be on hand to address any questions about the MDA and the project.
Recommended/Desired Action
Staff recommends approval of the resolution.
Attachment(s)
Resolution
Drafter
Cliff Keheley
Head of Department
Cliff Keheley