Klauer Mfg Ofr to buy 4th St prMEMORANDUM
January 13, 2003
TO:The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Offer to Buy Real Estate and Acceptance - Klauer Manufacturing
Company
Economic Development Director Bill Baum is recommending City Council approval of
the Offer to Buy Real Estate and Acceptance for the property on the 4th Street peninsula
owned by Klauer Manufacturing Company. The Klauer property is a 0.529 acre parcel
in the middle of the previously acquired Dubuque Hardwoods property.
The purchase price of $27,000 will be paid at closing. The City will acknowledge a
charitable contribution of $200,000.
The Company's terms and conditions include the Company providing a $200,000
charitable contribution to the City in lieu of cash, and in return, the City Council acting
favorably on the Company's request to name the riveffront Plaza, directly adjacent and
east of the Grand River Center, as the W. J. Klauer Plaza.
This land donation and previous cash donation of the Klauer family is $250,000, which
provides the Klauers with a naming opportunity. Economic Development Director Bill
Baum is recommending that the plaza directly adjacent and east of the Grand River
Center be named the W.J. Klauer Plaza, per their request.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Michael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
William Baum, Economic Development Director
CITY OF DUBUQUE, IOWA
MEMORANDUM
Januaw 9,2003
TO:Michael Van Milligen, City Manager
FROM:William Baum, Economic Development Director
SUBJECT:Offer to Buy Real Estate and Acceptance - Klauer Manufacturing
Company
Introduction
This memorandum presents for City Council consideration a Resolution approving an
Offer to Buy Real Estate and Acceptance for the sale of land owned by Klauer
Manufacturing Company on the 4th Street Peninsula to the City.
Background
The Klauer property is a 0.529 acre parcel in the middle of the previously acquired
Dubuque Hardwoods property. Klauer Manufacturing has offered to sell the property,
appraised at $227,000, for $27,000 and make a donation of the remaining value. The
acquisition will, when combined with the former Hardwoods property and other City-
owned property, create a large redevelopment site in the Port of Dubuque.
The sale of the Dubuque Hardwoods property to Dubuque Initiatives included a
stipulation that the City attempt to acquire the Klauer property, and, if acquired, transfer
the property and adjoining right of way to Dubuque Initiatives to consolidate the parcel.
Discussion
The negotiated purchase of this property includes the following significant terms:
1. The purchase price of $27,000 will be paid at closing. The City will acknowledge
a charitable contribution of $200,000.
2. The property will be conveyed by Corporate Warranty Deed on or before
February 5, 2003, the closing and possession date.
3. As a condition of the purchase, the City will purchase the property "as is" and
agrees to release, indemnity and hold harmless the seller. (A Phase II
Environmental Assessment has already been completed as part of the
Hardwoods purchase.)
4. A plaque will be placed at a mutually agreeable location in the Port of Dubuque
acknowledging the contribution of Klauer Manufacturing Company and/or W. J.
Klauer and C. R. Klauer to the community.
The property purchase will allow the City to transfer the property to Dubuque Initiatives
as envisioned in the prior sale of the Dubuque Hardwoods property.
The purchase of this property is being accomplished through the splendid cooperation
of the Klauer family, particularly William R. and James F. Klauer, President and
Secretary of the Company. The generosity of the family and the Company is a great
example of good corporate citizenship, and their commitment to the future of Dubuque
is evident to all of us that have worked with them and their legal counsel.
The Company's terms and conditions include the Company providing a $200,000
charitable contribution to the City in lieu of cash, and in return, the City Council acting
favorably on the Company's request to name the Riverfront Plaza, directly adjacent and
east of the Grand River Center, as the W. J. Klauer Plaza.
Recommendation
I would recommend that the City Council approve the Offer to Buy Real Estate and
Acceptance for the property on the 4th Street Peninsula owned by Klauer Manufacturing
Company and the naming of the plaza. This action consolidates a large parcel of land
for redevelopment in the Port of Dubuque,
Action Step
The action step for the City Council is to adopt the attached Resolution.
Attachment
F:\USERS~Pmyh re\WPDOCS~OAN DOO\DBQHARDWOODS\Klaueroffer[obuy. mem.doc
Prepared by Barry A. Lindah1300 Main Street Suite 330 Dubuque IA 52001 563 583-41 i 3
RESOLUTION NO. 29-03
APPROVING AN OFFER TO BUY AND ACCEPTANCE FOR THE
PURCHASE OF CERTAIN REAL ESTATE IN DUBUQUE
COUNTY, IOWA FROM KLAUER MANUFACTURING COMPANY
WHEREAS, the City Manager has negotiated an Offer to Buy Real
Estate and Acceptance with Klauer Manufacturing Company for the
purchase of the following described real property in Dubuque County,
Iowa:
Lots numbered 20 to 30, both inclusive, in Block 21, Dubuque Harbor
Improvement Company's Addition, in the City of Dubuque, Iowa,
according to the recorded Plat thereof.
AND WHEREAS, the City Council has determined that the purchase of the
property is in the best interests of the City of Dubuque.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF
THE CITY OF DUBUQUE, IOWA, AS FOLLOWS:
The City of Dubuque hereby approves the Offer to Buy Real Estate and
Acceptance, a copy of which is attached hereto.
....
Passed, approved and adopted this 20th day of January, 2003.
Terrance M. Duggan, Mayor
Attest: . -..
Jeanne F. Schneider, City Clerk
Prepared by: John C. O'Connor, O'Connor & Thomas, P.C., Dubuque Building, 700 Locust St., Suite 200, P.O. Box 599,
Dubuque, IA 52004-0599 (563) 557-8400
OFFER TO BUY REAL ESTATE
AND ACCEPTANCE
TO: KLAUER MANUFACTURING COMPANY, an Iowa corporation ("Seller")
The tmdersigned Buyer hereby offers to purchase certain real estate located in Dubuque Connty,
Iowa, from the Seller, upon the following terms and conditions:
Real Estate Description: Buyer offers to buy real estate in Dubuque County, Iowa,
described as follows:
Lots numbered 20 to 30, both inclusive, in Block 21, Dubuque Harbor Improvement
Company's Addition, in the City of Dubuque, Iowa, according to the recorded Plat
thereof, attached hereto as Exhibit "A" and by this reference made a part thereof.
With any easement and appurtenant servient estates, but subject to any zoning and other
ordinances, any covenants of record, any easements of record for public utilities, road and
highways, and any other easements of record, hereafter designated the "Real Estate."
2. 'Bargain Sale/Purchase Price. The parties acknowledge that:
(a) The Buyer, is a municipal corporation in the State of Iowa; and,
Co)
The parties acknowledge that the value of the Real Estate, shown by the appraisal
obtained by Seller, is $227,000.00. Attached hereto as Exhibit "B" and by this
reference made apart hereof is the December 6, 2002, cover letter to the appraisal
performed for Seller by Thomas P. Kane of Kane Appraisal and Real Estate, Inc.,
of Dubuque, Iowa, which the parties acknowledge to be the value of the Real
Estate shown by the appraisal; and,
(c)
The Seller, as a long term corporate citizen of the City of Dubuque, Iowa, and
with the intent to make a gift, is willing to sell the Real Estate to Buyer for:
(i) $27,000.00, to be paid pursuant to Section 2(d)(i) below, and,
(ii)
Seller, with donative intent, gives the balance of the value of the Real
Estate, or $200,000.00, to Buyer. Buyer acknowledges that Buyer is a
political subdivision within the meantng of Section 170(c)(1) of the
Internal Revenue Code of 1986, as amended. Buyer agrees to execute at
the Closing (defined below) the Form 8283, Non-Trust Charitable
Contribution, recognizing the receipt of, and the value (pursuant to the
appraisal) of the charitable contribution made by Seller to Buyer as
referred to herein; and,
(d) The bargain sale aspect of this transaction shall be paid as follows:
(i)
$27,000.00 to be paid at the Closing by certified check, cashier's check,
electronic funds transfer or other means which provides immediately
available cash to the Seller; and,
(ii)
The purchase and bargain sale of this Real Estate, and the acceptance of
the charitable contribution made herein, is subject only to the conditions
and contingencies described in this Offer to Buy Real Estate and
Acceptance. Buyer represents to Seller that Buyer has sufficient funds to
close this transaction in a timely fashion.
Page 1 of 4
Real Estate Taxes. Real estate taxes for the first half of the July 1, 2002-June 30, 2003
fiscal year and for all prior years shall be paid by Seller. Buyer shall be responsible for
the real estate taxes accruing after December 31, 2002.
Special Assessments. Buyer shall pay all special assessments which are a lien on the Real
Estate as of the date of acceptance of this Offer. All other special assessments shall be
paid by Buyer. The parties acknowledge that there are no special assessments against the
Real Estate as of the date hereof.
Risk of Loss: All risk of loss shall be upon Buyer until possession of the Real Estate
shall be delivered to Seller on the Date of Possession.
Care and Maintenancei The Real Estate shall be preserved in its present condition and
delivered intact at the time possession is delivered to Buyer, ordinary and reasonable wear
and tear excepte& See Section 17 below.
Possession/Date of Closing. If Buyer timely performs all obligations, possession of the
Real Estate shall be delivered to Buyer on or before February 5, 2003 ("Date of Closing")
("Date of Possession") as the parties mutually agree.
Use of the Purchase Price. At time of settlement, funds of the purchase price may be used
to pay taxes and other liens and to acquire outstanding interest, if any, of others.
Abstract of Title. Seller, at Buyer's expense, shall promptly obtain an abstract of title to
the Real Estate continued through the date of this agreement which shall be examined by
Buyer's attorney. Such abstract shall show merchantable title in Seller to that portion of
the Real Estate to which title is not disputed in conformity with this Offer, Iowa law and
Title Standards of the Iowa State Bar Association. The Seller shall make every
reasonable effort to promptly perfect title. The abstract shall become the property of
Buyer when the purchase price is paid in full. Buyer shall pay the cost of any additional
abstracting and title work due to any act or omission of Buyer. The abstract shall be
obtained from an abstractor qualified by the Title Guaranty Division of the Iowa Housing
Finance Authority.
10.
Deed. On the Closing Date, Seller shall convey the Real Estate to Buyer by Corporate
Warranty Deed, free and clear of all liens and encumbrances but subject to easements and
restrictions of record. Any general warranties of title contained in the Warranty Deed
shall extend only to the time of acceptance of this Offer, with special warranties as to acts
of Seller continuing up to time of delivery of the Corporate Warranty Deed.
11. Time is of the Essence. Time is of the essence in this contract.
12. Remedies of the Parties.
(a)
If Buyer fails to timely perform this contract, or any of Seller's conditions herein
are not satisfied (or waived in writing) at or prior to Closing, Seller shall not be
required to close hereunder. Alternatively, Seller may, at or prior to Closing,
forfeit this contract as provided by Iowa Code Chapter 656 (2001).
(b)
If Seller fails to timely perform this contract, or if any of Buyer's conditions
herein are not satisfied (or waived in writing) at or prior to Closing, Buyer shall
not be required to close hereunder.
(c)
Buyer and Seller are also entitled to utilize any and all other remedies or actions at
law or in equity available to them and shall be entitled to obtain judgment for
costs and attorney's fees as permitted by law. The parties specifically agree that
each of them shall have the remedy of specific performance in equity
notwithstanding any other provision herein or by law to the contrary.
Page 2 of 4
13. Contract Bindin~ on Successors in Interest. This contract shall apply to and bind the
successors in interest of the parties.
14.
15.
16.
17.
18.
19.
20.
Construction. Words and phrases shall be construed as in the singular or plural number
and as masculine, feminine or neuter gender, according to the context.
Conditions Precedent to Buyer's Obligation to Purchase. Buyer's obligation to purchase
the Real Estate under the bargain purchase referred to herein and to accept the charitable
contribution from Seller as referred to herein is expressly conditioned upon the
satisfaction of the following condition prior to Closing:
(a)
The approval of this Offer to Buy Real Estate and Acceptance by the City Council
of the City of Dubuque, Iowa, on or before February 5, 2003.
Conditions Precedent to Seller's Obligation to Make Bargain Sale and Make Contribution
and Give Charitable Contribution. Seller's obligation to make the bargain sale and give
to charitable contribution herein with respect to the Real Estate is expressly conditioned
upon the satisfaction of the following condition prior to closing:
(a)
Seller obtaining approval of this Offer to Buy Real Estate and Acceptance by the
Board of Directors of Seller.
Condition and Groundwater Hazards. As of the Closing Date, Buyer shall have inspected
the Real Estate and shall accept it in "AS IS" condition as of the Closing Date. Buyer
shall release, indemnify and hold harmless Seller with regard to any environmental claim,
clean-up or remediation imposed or threatened by the State of Iowa, the federal
government or any other governmental agency or entity, or any private person, arising out
of or related to the Real Estate, which indemnity and defense shall survive the closing
hereof.
Recording and Abstracting Costs. Notwithstanding any other provision herein, the Buyer
shall be responsible for all recording costs, transfer fees and abstracting costs in
cotmection with the transactions contemplated herein.
Miscellaneous Provisions. The parties agree that all understandings and agreements, if
any, previously made between the parties hereto are merged into this agreement, which
alone fully and completely expresses their understanding with respect to the purchase and
bargain sale of the Real Estate. This agreement may not be changed or terminated orally,
but only by an instrument in writing executed by all of the parties hereto. This agreement
shall not be transferred or assigned without the prior written consent of the other party
hereto, which consent shall not be unreasonably withheld. This agreement shall be
governed by and construed in accordance with the laws of the State of Iowa. This Offer
to Buy Real Estate and Acceptance may be signed in counterparts or by facsimile
signatures which, when taken together, shall constitute one original agreement. Each
party shall bear and be responsible for its own attorneys' fees.
Acknowledmnent. The parties agree that a plaque acceptable to all of the parties will be
placed at the River Front Development at a mutually agreeable site acknowledging the
contribution of the Seller and/or by W. J. Klaner and C.R. Klauer to the Community at
Buyer's expense.
Page 3 of 4
DATED: ,2003.
THE CITY OF DLrBUQUE, AN IOWA
MUNICIPAL CORPORATION, BUYER
By:.
Terrance M. Duggan, Mayor
By:.
Jeanne F. Schneider, City Clerk
STATE OF IOWA, COUNTY OF DUBUQUE ) ss.
On this day of ,2003, before me, the undersigned, a Notary Public
in and for the said State, personally appeared Ten'ance M. Duggan and Jeanne F. Schneider, to
me personally known, who, being by me duly sworn, did say that they are the Mayor and City
Clerk of the City of Dubuque, Iowa; (that the seal affixed to the foregoing instrument is the
corporate seal of the corporation), and that the instrument was signed (and sealed) on behalf of
the corporation, by authority of its City Council, as contained in Resolution No. passed
by the City Council on the day of ,2003, and that Terrance
M. Duggan and Jeanne F. Schneider acknowledged the execution of the instrument to be their
voluntary act and deed and the voluntary act and deed of the corporation, by it voluntarily
executed.
INSERT SEAL
THIS OFFER IS ACCEPTED
Notary Public in and for said State
My Commission Expires:
,2003.
KLAUER MANUFACTUR/NG COMPANY
William R. Klaner, President
flames F. Klauer, Secretary
STATE OF IOWA, COUNTY OF DUBUQUE ) ss.
On this lp~ day of J-.4 ~/ ,2003, before me, the undersigned, a Notary Public in
and for the said State, personally appeared William R. Klauer and James F. Klaner to me
personally known, who being duly sworn, did say that they are the President and Secretary,
respectively, of Klaner Manufacturing Company, the corporation executing the within and
foregoing instrument; that said instrument was signed (and sealed) on behalf of the corporation
by authority of its Board of Directors; and that William R. Klaner and James F. Klauer, as
officers acknowledged the execution of the foregoing ins~tm~.t~ent to be the voluntary act and deed
°f the c°rp°rati°n, bY it and bY them v°luntarily exeTte'~d'/~ /,/ff~~
z~tary Public in and for said State
~My Commission Expires:
INSERT SEAL
Page 4 of 4
EXHIBIT A
LEGAL DESCRIPTION
Lots numbered 20 to 30, both inclusive, in Block 21, Dubuque Harbor Improvement
Company's Addition, in the City of Dubuque, Iowa, according to the recorded Plat
thereof.
With any easement and appurtenant servient estates, but subject to any zoning and other
ordinances, any covenants of record, any easements of record for public utilities, road and
highways, and any other easements of record.
Buyer releases, indemnifies and holds harmless Seller with regard to any environmental
claim, clean-up or remediation imposed or threatened by the State of Iowa, the federal
government or any other governmental agency or entity, or any private person, arising out
of or related to the Real Estate.
Any general warranties of title contained in the Warranty Deed shall extend only to the
time of acceptance of this Offer, with special warranties as to acts of Seller continuing up
to time of delivery of the Corporate Warranty Deed.
EXHIBIT B
APPRAISAL OF THOMAS P. KANE
December 6, 2002
Mr. William J. Klauer Jr.
Klauer Manufacturing Company
1185 Roosevelt Street Extension
Dubuque, Iowa 52001
Dear Mr. Klauer,
As requested, I have personally inspected the Klauer Manufacturing Company land pamel in the Dubuque Ice
Harbor area. The purpose of the Appraisal is to estimate the Market Value of the Fee Simple Interest of the
subject property. The function of the Appraisal is for investment analysis purposes. The intended users of the
report are you and your designated property representatives.
I certify that, to the best of my knowledge and belief:
1) The statements of fact contained in this report are true and correct.
2) The reported analyses, opinions, and conclusions are limited only by the reported assumptions and
limiting conditions, and are my personal, unbiased, professional analyses, opinions and conclusions.
3) I have no present or prospective interest in the property that is the subject of this report, and I have no
personal interest or bias with respect to the parties involved.
4) My compensation is not contingent upon the reporting of a predetermined value or direction in value that
favors the cause of the client, the amount of the value estimate, the attainment of a stipulated result, or the
occurrence of a subsequent event.
5) My analyses, opinions, and conclusions were developed, and this report has been prepared in
accordance with the final rule by Office of the Comptroller of the Currency (12 CFR Part 34) dated August 24,
1990, as amended, the Uniform Standards of Professional Appraisal Practice and in conformity with the
requirements of the Code of Professional Ethics and the Standards of Professional Practice of the Appraisal,
Institute.
6) I have made a personal inspection of the property that is the subject of this report.
7) No one provided significant professional assistance to the person signing this report.
8) The value estimates in this report were not based on a requested minimum valuation, a specific
valuation, or for the approval of any loan.
9) The use of this repoFt is subject to the requirements of the Appraisal Institute relating to review by its
duly authorized representatives.
3
The prospective values estimated in this repod were based on market data and conditions as of
December 4, 2002, which were projected to remain stable. It is impossible to accurately anticipate the future
conditions that could influence the values. I project that market conditions should continue to improve at a
moderate rate. Any substantial changes in market conditions could have a favorable or unfavorable influence
on the values. I accept no responsibility regarding future changes in the market that could not be anticipated
as of the date of this report. I project the marketing period for a sale to be about 12 to 48 months.
This transmittal letter and certification precede the Appraisal report, further describing the subject properly
and continuing the reasoning and pertinent data leading to the estimated value. Your attention is directed to
the "General Underlying Assumptions" and "Limiting Conditions" which are considered usual for this type of
assignment and have been included at the end of this report.
As a result of my investigation, and based upon the analysis of the following data; it is my opinion that the
Market Value of the subject property, as of December 4, 2002 is as follows:
$227,000
TWO HUNDRED TWENTY-SEVEN THOUSAND DOLLARS
Thomas P. Kane
Kane Appraisal and Reel Estate, Inc.
Certified General Appraiser
Iowa fl483-72-5444