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Old Mill Rd Lease Agreement_David HartigMEMORANDUM Januaw 29,2004 TO: FROM: SUBJECT: The Honorable Mayor and City Council Members Michael C. Van Milligen, City Manager Lease of Old Mill Road Properties to David S. Hartig, Jr. Assistant City Engineer Gus Psihoyos is recommending City Council approval of a 99-year lease agreement with David S. Hartig, Jr. for throe rosidential properties at 1620, 1695 and 1699 Old Mill Road, and upon City acquisition, the commemial property at 1650 Old Mill Road. The lease roquires that the property be maintained as green space and a naturo proserve. Mr. Hartig will contribute the amount of the City's match, $16,850, for the acquisition of the flood-damaged property at 1650 Old Mill Road. I concur with the recommendation and respectfully request Mayor and City Council approval. Mi~ha~elC.~a/n Milligen ' -~ MCVM/jh Attachment cc: Barry Lindahl, Corporation Counsel Cindy Steinhauser, Assistant City Manager Gus Psihoyos, Assistant City Engineer Mike Koch, Public Works Director MEMORANDUM January28, 2004 TO: FROM: Michael C. Van Milligen, City Manager Gus Psihoyos, Assistant City Engineer SUBJECT: Lease of Old Mill Road Properties to David S. Hartig, Jr. BACKGROUND On September 16, 2002, by resolution, the City Council authorized the City Manager to submit an application for financial assistance under the Hazard Mitigation Grant Program (HMGP) to purchase six (6) properties, five residential and one commercial, on Old Mill Road. Flooding substantially damaged the commercial property and three of the residential properties. Due to the state's priority to acquire substantially damaged residential properties, one of the properties, 1650 Old Mill Road, a commercial property, was considered a Iow priority. In December of 2003, the City Council endorsed letters to Senator Tom Harkin, Representative Jim Nussle, and Senator Chuck Grassley requesting $46,000 in FEMA funds specifically for the acquisition of 1650 Old Mill Road. On March 10, 2003, the Iowa Emergency Management Division (IEMD) notified the City that the Federal Emergency Management Agency (FEMA) approved $201,596 in federal funding for the City's project application. The budget was established based on the cost to purchase and demolish the three substantially damaged residential properties: 1695 Old Mill Road, 1699 Old Mill Road, and 1620 Old Mill Road. However, due to the state's priority to acquire substantially damaged residential properties and the lack of funds for all project requests, funding for the substantially damaged commercial property, 1650 Old Mill Road, was not specifically provided. In March of 2003, the City Council approved a Contract for Services with East Central Intergovernmental Association (ECIA) for the administrative services associated with the Grant Agreement between the City of Dubuque and IEMD. Because the projected balance of state and federal funds after the acquisition of the three residential properties was $32,264.67, Mark Schneider proposed that ECIA draft an amendment request, on behalf of the City and the property owner of 1650 Old Mill Road, to increase the project scope to include the acquisition of 1650 Old Mill Road. In September, the City Council authorized ECIA to make the amendment request. In addition, the City Council authorized the City Manager to negotiate a lease agreement with David S. Hartig, Jr. to lease 1695 Old Mill Road, 1699 Old Mill Road, 1620 Old Mill Road, and 1650 Old Mill Road should IEMD approve funding for acquisition of the properties. DISCUSSION On October 8, 2003, staff received notice from IEMD that the City's amendment request was eligible for funding under the Hazard Mitigation Grant Program. IEMD concurred with the City's request and submitted it to FEMA for final approval. Following FEMA's approval, the acquisition process has proceeded for the commercial property at 1650 Old Mill Road. The closing is scheduled for February 17th. At the time of closing, Mr. Hartig will contribute to the City approximately $16,850 to be used for the purchase of 1650 Old Mill Road. In consideration for that contribution, Mr. Hartig desires a long term (99 year) lease for all of the Old Mill Road properties. The lease requires that the property be maintained as green space and a nature preserve. RECOMMENDATION I recommend that the City Council approve the lease of the three residential properties, 1620,1695, and 1699 Old Mill Road, and, upon acquisition, the commercial property at 1650 Old Mill Road to Mr. Hartig for a period of 99 years. ACTION REQUESTED I respectfully request that the City Council adopt the attached resolution setting the lease agreement for public headng. attachments CC: Michael Koch, Public Works Director Cindy Steinhauser, Assistant City Manager Ken TeKippe, Finance Director Deron Muehdng, Civil Engineer II Mark Schnieder, ECIA David Hartig Prepared by: Barry A. Lindah1300 Main Street Suite 330 Dubuque IA 52001 563 583-4113 RESOLUTION NO. 51 -04 INTENT TO DISPOSE OF AN INTEREST IN REAL PROPERTY BY LEASE WITH DAVID S. HARTIG, JR. WHEREAS, the City of Dubuque, Iowa (City) is the owner of the following properties: Lot 1-1-2-1 Mineral Lot 507 Lot 1-1-2-1-2-1-4 Mineral Lot 501 Lot 2-1-2-1-1-2-1-4 Mineral Lot 501 Lot 2 Papke Place Lot 1-1-2-1-1-2-1-4 Mineral Lot 501 Lot 2-1-1-1-1-2-1-4 Mineral Lot 501 Lot 2-1-2-1-2-1-4 Mineral Lot 501; and City intends to purchase Lot 1 Old Mill Place, all of which properties are referred to herein as the City Property; and WHEREAS, David S. Hartig, Jr. (Hartig) proposes to lease the City Property on the terms set forth in the attached Lease Agreement; and WHEREAS, the City Council of the City of Dubuque, Iowa, has determined that it is in the best interests of the City to lease the City Property to Hartig. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: Section 1. The City of Dubuque, Iowa, intends to dispose of its interest in the foregoing- described City Property by Lease Agreement between City and David S. Hartig, Jr., a copy of which is attached hereto. Section 2. The City Clerk is hereby authorized and directed to cause this Resolution and a notice to be published as prescribed by Iowa Code Section 364.7 of a public hearing on the City's intent to dispose of the foregoing-described City Property, to be held on the 16th day of February, 2004, at 7:00 o'clock p.m. at lhe public library auditorium, 11th & Locust, Dubuque, Iowa. Attest: Jeanne Schneider, City Clerk Passed, approved and adopted this 2nd day of February, 2004. Terrance M. Duggan, Mayor Preparer Information Barry A. Lindah1300 Main Street Suite 330 Dubuque IA 52001 563 583-4113 Individual's Name Street Address City Phone Barry A, Lindahl ISBA # 6899 SPACE ABOVE THIS LINE FOR RECORDER LEASE AGREEMENT BETWEEN THE CITY OF DUBUQUE, IOWA AND DAVID S. HARTIG, JR. THIS AGREEMENT, made and entered into this __ day of ,2004, by and between the City of Dubuque (City), whose address, for the purpose of this Lease, is 50 W. 13th Street, Dubuque, IA, 52001 and David S. Hartig, Jr. (Hartig), whose address for the purpose of this Lease is 1495 Southern Avenue, Dubuque, IA, 52003. The parties agree as follows: 1. PREMISES AND TERM. situated in Dubuque County, Iowa: City leases to Hartig the following real estate, Lot 1-1-2-1 Mineral Lot 507 Lot 1-1-2-1-2-1-4 Mineral Lot 501 Lot 2-1-2-1-1-2-1-4 Mineral Lot 501 Lot 1 Old Mill Place Lot 2 Papke Place Lot 1-1-2-1-1-2-1-4 Mineral Lot 501 Lot 2-1-1-1-1-2-1-4 Mineral Lot 501 Lot 2-1-2-1-2-1-4 Mineral Lot 501 together with all improvements thereon, and all rights, easements and appurtenances th thereto belonging, for a term beginning on the 7 day of August, 2004, and ending on the 6th day of August, 2103, upon the condition that Hartig performs as provided in this Lease. 2. RENT. Hartig agrees to pay City as rent $1.00 for the term of the Lease. The parties acknowledge that Hartig has previously paid to City the sum of $16,800.00 for City's use in the purchase of the premises. For purposes of this Lease Agreement, such amount shall also be considered rent. 3. POSSESSION. Hartig shall be entitled to possession on the first day of the Lease term, or such earlier date as the parties may agree, and shall yield possession to City at the termination of this Lease. SHOULD CITY BE UNABLE TO GIVE POSSESSION ON SAID DATE, HARTIG'S ONLY DAMAGES SHALL BE A PRO RATA ABATEMENT OF RENT. 4. USE. Hartig shall use and maintain the premises only for green space and a nature preserve. No parking of vehicles or storage of vehicles or other materials of any kind shall per permitted on the premises. 5. CARE AND MAINTENANCE. (a) Hartig takes the premises as is. (b) Hartig shall maintain the premises in a reasonable safe, clean and presentable condition, including the mowing of grass. Hartig shall not erect any structure of any kind on the premises without the prior written consent of City. City agrees to remove all snow and ice from the sidewalk on or abutting the premises. (c) Hartig shall upon possession of the premises seed or sod the premises at his expense. Hartig may also at his expense plant such trees of such kind and at such locations as he deems appropriate on the premises. 6. UTILITIES AND SERVICES. which may be used on the premises. Hartig shall pay for all utilities and services 7. SURRENDER. Upon the termination of this Lease, Hartig will surrender the premises to City in good and clean condition. Continued possession, beyond the term of this Lease and the acceptance of rent by City shall constitute a month-to-month extension of this Lease. 8. ASSIGNMENT AND SUBLETTING. Hartig shall not assign, sublet or otherwise transfer the premises or any part thereof, and any attempted assignment, subletting or transfer shall work an automatic forfeiture and termination of this Lease. 9. INSURANCE. Hartig shall obtain general liability insurance as set forth in the City's Insurance Schedule for Lessee's of City Property as such schedule may from time to time be amended. A copy of the current schedule is attached here to. 11. INDEMNITY Hartig will protect, defend, and indemnify City from and against any and all loss, costs, damage and expenses occasioned by, or arising out of, any accident or other occurrence causing or inflicting injury or damage to any person or property, happening or done in, upon or about the premises, or due directly or indirectly to the tenancy, use or occupancy thereof, or any part thereof by Hartig or any person claiming through or under Hartig. 12. MECHANICS' LIENS. Neither Hartig, nor anyone claiming by, through, or under Hartig, shall have the right to file any mechanic's lien against the premises. 13. DEFAULT, NOTICE OF DEFAULT AND REMEDIES. A. The following shall constitute an event of default by Hartig: Failure to observe or perform any duties, obligations, agreements, or conditions imposed on Hartig pursuant to the terms of the Lease. B. City shall give Hartig a written notice specifying the default and giving Hartig ten (10) days in which to correct the default. If there is a default that cannot be remedied in ten (10) days by diligent efforts of Hartig, Hartig shall propose an additional period of time in which to remedy the default. Consent to additional time shall not be unreasonably withheld by City. City shall not be required to give Hartig any more than three notices for the same default within any 365 day period. C. In the event Hartig has not remedied a default in a timely manner following a Notice of Default, City may declare this Lease to be terminated and shall give Hartig a written notice of such termination. In the event of termination of this Lease, City shall be entitled to prove claim for and obtain judgment against Hartig for the reasonable expenses of the City in regaining possession of the premises, including attorney's fees and court costs. D. In the event of termination of this Lease by City other than for Hartig's default, Hartig shall be entitled to a pro rata abatement of rent. 14. NOTICES AND DEMANDS. All notices shall be given to the parties hereto at the addresses designated unless either party notifies the other, in writing, of a different address. Without prejudice to any other method of notifying a party in writing or making a demand or other communication, such notice shall be considered given under the terms of this Lease when it is deposited in the U.S. Mail, registered or certified, properly addressed, return receipt requested, and postage prepaid. 15. PROVISIONS BINDING. Each and every covenant and agreement herein contained shall extend to and be binding upon the respective successors, heirs, administrators, executors and assigns of the parties hereto. ClTYOF DUBUQUE, IOWA By Terrance M. Duggan, Mayor Attest: Jeanne F. Schneider, City Clerk David S. Hartig, Jr. STATE OF IOWA DUBUQUE COUNTY : SS: On this day of ,2004, before me, a Notary Public in and for the State of iowa, in and for said county, personally appeared David S. Hartig, Jr., to me personally known, who acknowledged the execution of this instrument to be his voluntary act and deed. Notary Public, State of Iowa STATE OF IOWA DUBUQUE COUNTY : SS: On this day of ,2004,, before me, a Notary Public in and for the State of Iowa, in and for said county, personally appeared Terrance 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, respectively of the City of Dubuque, a Municipal Corporation, created and existing under the laws of the State of Iowa, and that the seal affixed to said instrument is the seal of said Municipal Corporation and that said instrument was signed and sealed on behalf of said Municipal corporation by authority and resolution of its City Council and said Mayor and City Clerk acknowledged said instrument to be the free act and deed of said Municipal Corporation by it voluntarily executed. Notary Public, State of Iowa INSURANCE SCHEDULE A INSURANCE REQUIREMENTS FOR TENANTS AND LESSEES OF CITY PROPERTY OR VENDORS (SUPPLIERS, SERVICE PROVIDERS) TO THE CITY OF DUBUQUE 1. Ail policies of insurance required hereunder shall be with an insurer authorized to do business in Iowa. All insurers shall have a rating of A of better in the current A.M. Best Rating Guide. Ali policies of insurance shall be endorsed to provide a thirty (30) day advance notice of cancellation to the City of Dubuque if cancellation is prior to the expiration date. This endorsement supersedes the standard cancellation statement on the Certificate of Insurance. Hartig shall furnish a Certificate of Insurance to the City of Dubuque, Iowa for the coverage required in Paragraph 6 below. Such certificates shall include copies of the following policy endorsements: a) Thirty day notice of cancellation to the City of Dubuque. b) Commercial General Liability policy is primary and non-contributing. c) Commercial General Liability additional insured endorsement. d) GovemmentalImmunity Endorsements. e) Waiver of recovery under workers cempensation. 4. Each certificate shall be submitted to the contracting department of the City of Dubuque. Failure to provide minimum coverage shall not be deemed a waiver of these requirements by the City of Dubuque. Failure to obtain or maintain the required insurance shall be considered a material breach of this agreement. 6. Hartig shall be required to carry the following minimum coverage/limits or greater if required by law or other legal agreement: a) COMMERCIAL GENERAL LIABILITY General Aggregate Limit Products-Completed Operations Aggregate Limit Personal and Advertising Injury Limit Each Occurrence Limit Fire Damage Limit (any one occurrence) Medical Payments $2,000,000 $1,000,000 $1,000,000 $1,000,000 $ 50,000 $ 5,000 This coverage shall be written on an occurrence, not claims made, form per location. All deviations or exclusions from the standard ISO commercial general liability form CG 0001 or Business owners form BP 0002 shall be clearly identified. Governmental Immunity Endorsement identical or equivalent to form attached. An additional insured endorsement identical or equivalent to ISO Form CG 2026 or CG 2011 and include as additional insureds: "The City of Dubuque, including all its elected and appointed officials, all its employees and volunteers, all its boards, commissions and/or authorities and their board members, employees, and volunteers." POLICY NUMBER COMMERCIAL GENERAL LIABILITY THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED - DESIGNATED PERSON OR ORGANIZATION This endorsement modifies insurance provided under the follow'rog: COMMERCIAL GENERAL LIABILITY COVERAGE PART. SCHEDULE Name of Person Or Organization: The City of Dubuque, including all its elected and appointed officials, all its employees and volunteers, all its boards, commissions and/or authorities and their board members, employees, and volunteers. (If no entry appears above, information required to complete this endorsement will be shown in the Declarations as applicable to this endorsement.) WHO IS AN INSURED (Section II) is amended to include as an insured the person or organization shown in the Schedule as an insured but only with respect to liability arising out of your operations or premises owned by or rented to you. Copydqht. Insurance Services Office. Inc. 1994 CG 20 26 11 85 CITY OF DUBUQUE, IOWA GOVERNMENTAL IMMUNITIES ENDORSEMENT 1. Nonwaiver of Governmental Immunity. The insurance carrier expressly agrees and states that the purchase of this policy and the including of the City of Dubuque, Iowa as an Additional Insured does not waive any of the defenses of governmental immunity available to the City of Dubuque, Iowa under Code of Iowa Section 670.4 as it is now exists and as it may be amended from time to time. Claims Coveraqe. The insurance carrier further agrees that this policy of insurance shall cover only those claims not subject to the defense of governmental immunity under the Code of Iowa Section 670.4 as it now exists and as it may be amended from time to time. Those claims not subject to Code of Iowa Section 670.4 shall be covered by the terms and conditions of this insurance policy. Assertion of Government Immunity. The City of Dubuque, Iowa shall be responsible for assertir~g any defense of governmental immunity, and may do so at any time and shall do so upon the timely written request of the insurance carrier. Non-Denial of Coveraqe. The insurance carrier shall not deny coverage under this policy and the insurance carder shall not deny any of the rights and benefits accruing to the City of Dubuque, Iowa under this policy for reasons of governmental immunity unless and until a court of competent jurisdiction has ruled in favor of the defense(s) of governmental immunity asserted by the City of Dubuque, Iowa. No Other Chan~e in Policy. The above preservation of governmental immunities shall not otherwise change or alter the coverage available under the policy. MEMORANDUM September 11,2003 TO: FROM: SUBJECT: The Honorable Mayor and City Council Members Michael C. Van Milligen, City Manager Acquisition and Demolition of 1650 Old Mill Road Assistant City Engineer Gus Psihoyos is recommending that an amended request be made to the Iowa Emergency Management Division to acquire a non-residential flood prone property at 1650 Old Mill Road. There would be no cost to the City as the local match would be provided by Mr. David Hartig in return for a 99-year lease on the vacant property where the three previously acquired residential properties and this commercial property stood. This lease will be subject to a public headng. I concur with the recommendation and respectfully request Mayor and City Council approval. Miohael C. Van Milligen MCVM/jh Attachment cc: Barry Lindahl, Corporation Counsel Cindy Steinhauser, Assistant City Manager Gus Psihoyos, Assistant City Engineer Mike Koch, Public Works Director MEMORANDUM September 10, 2003 TO: FROM: Michael C. Van Milligen, City Manager Gus Psihoyos, Assistant City Engineer SUBJECT: Acquisition and demolition of 1650 Old Mill Road BACKGROUND On September 16, 2002, by resolution, the City Council authorized the City Manager to submit an application for financial assistance from the State of Iowa Emergency Management Division under the Hazard Mitigation Grant Program (HMGP) to purchase six (6) properties, five residential and one commercial, on Old Mill Road. Only the commemiat property and three of the residential properties were considered substantially damaged and thus eligible for assistance. Due to the state's pfiodty to acquire substantially damaged residential properties, 1650 Old Mill Road, which is commercial, (see figure 1 ) was considered a Iow priority. In December of 2003, the City Council endorsed letters to Senator Tom Harkin, Representative Jim Nussle, and Senator Chuck Grassley requesting $46,000 in FEMA funds specifically for the acquisition of 1650 Old Mill Road which is situated between two of the substantially damaged residential properties. On March 10, 2003, the Iowa Emergency Management Division (IEMD) notified the City that the FEMA approved $201,596 in federal funding for the City's project application. As a result, the project budget was established as follows: Federal Share $201,596 State share (10%) 26,880 City (15% local share) 40,319 TOTAL $268,795 The budget was established based on the cost to purchase and demolish the ~ree substantially damaged residential properties: 1695 Old Mill Road, 1699 Old Mill Road, and 1620 Old Mill Road. Again, due to the state's priodty to acquire substantially damaged residential properties and the general lack of funds for all project requests, funding for the substantially damaged commercial property, 1650 Old Mill Road, was not specifically provided. Figure 1. 1650 Old Mill Road on June 4, 2002. In Mamh of 2003, the City Council approved a Contract for Services with East Central Intergovernmental Association (ECIA) for the administrative services associated with the Grant Agreement between the City of Dubuque and IEMD. DISCUSSION According to Mr. Mark Schneider of ECIA, the balance of state and federal funds after the acquisition of the three residential properties is $32,264.67. Mr. Schneider has suggested that ECIA could draft an amendment request, on behalf of the City and the property owner of 1650 Old Mill Road, to increase the project scope to include the acquisition of the 1650 Old Mill Road Property. Mr. David Hartig has committed, in writing, to the City that he will provide approximately $16,850 as a local match toward the purchase of the property in return for a long term (99 year) lease with the City for the commercial property and the three residential properties already acquired. BUDGETIMPACT Following the same guidelines used to establish the purchase price of the residential properties, the funding required to purchase and demolish 1650 Old Mill Road is as follows: Project Costs Purchase pdce Recording fee (estimate) Closing costs (estimate) Demolition (contractor's estimate) Legal Fees for lease agreement with Mr. Hartig TOTAL Project Funding Balance of State & Federal funds previously budgeted FEMA Public Assistance funds for demolition Funds provided by Mr. Hartig (includes required 15% local match) TOTAL $46,934.13 21.00 160.00 10,000.00 500.00 $57,615.13 $32,264.67 8,500.00 16,850.46 $57,615.13 This is a volunteer program. The City or the property owner of 1650 Old Mill Road can decide against the HGMP at any time during the process. There is no impact to the City budget. RECOMMENDATION I recommend that the City request ECIA to make an amendment request to IEMD, on behaff of the City and the property owner of 1650 Old Mill Road, to increase the project scope to include the acquisition of 1650 Old Mill Road. In addition, I recommend that the City lease the three residential properties, 1620,1695, and 1699 Old Mill Road and, upon acquisition funding approval from the EMD, 1650 Old Mill Road, to Mr. Hartig. Mr. Hartig has requested the following terms: 1) The lease would become effective as soon as the structures have been demolished and cleared from the properties; 2) The length of the lease would be 99 years; and 3) Mr. Hartig would be responsible for maintaining the property as open green space for the length of the lease. Due to Mr. Hartig's generous centdbution towards the purchase of 1650 Old Mill Road, the 99-year lease fee would be set at one dollar ($1.00). ACTION REQUESTED I respectfully request that the City Council authorize ECIA to make an amendment request to IEMD to increase the project scope to include the acquisition of 1650 Old Mill Road. In addition, I respectfully request that the City Council authorize the City Manager to negotiate a lease agreement with Mr. Hartig for 1695 Old Mill Road, 1699 Old Mill Road, 1620 Old Mill Road, and 1650 Old Mill, should IEMD approve funding for acquisition. Prepared by Deron Muehring, City of Dubuque Engineering CC: Michael Koch, Public Works Director Cindy Steinhauser, Assistant City Manager Ken TeKippe, Finance Director Deron Muehdng, Civil Engineer II Mark Schnieder, ECIA David Hartig EAST CENTRAL INTERGOVERNMENTAL ASSOCIATION A Re§ional Response to ca! Suite 200 3999 Pennsylvania Avenue Dubuque, IA 52002 July 9, 2003 City of Dubuque Attn.: Mike Van Milligen, City Manager 50 West 13th St. Dubuque, IA 52001 Dear Mike: This letter is a follow up to our past discussions regarding the City's acquisition of the Pancratz property located at 1650 Old Mill Road. Based on our last conversation I have completed the following. I obtained a quote for the demolition of the 1650 Old Mill Rd. structures including the buildings, parking lots, and the capping of all utilities with the exception of the abandoned well. In addition to the quote and well abandoment, we must complete an asbestos inspection prior to demolition. Based on that quote, I am confident that the $10,000 figure for demolition that I used for budget purposes should be very accurate. I then discussed the project budget and the City's position with Mr. David Hartig. Mr. Hartig understands that the City will not provide any funds on this project. Mr. Harfig understands the position as evidenced in his commitment letter fi:om him to provide the City's match for this pmjecL (See enclosed letter.) You will note that he desires a long term, 99-year lease for all four of the Old Mill Road properties and will maintain them for the length of the lease as open green space. If all of these items meet with your approval, I will prepare an amendment request to the Iowa Emergency Management Division to increase the project scope to include the acquisition of the 1650 Old Mill Road property. PHONE [563) 556-4166 10WA ONLY (800) 942-4648 F~ (563) 556-0348 [-~AAiL ecia@ecia.org W£g SITE www.ecia.org Dubuque Metropolitan Rrea Transportation Stud~' · Eastern Iowa Regional Housing Authorit~j. Region I Emplmjment and Training o ECIR Regional Planning Rffiliafion · EClR Business Growth, In~ · July 9, 2003 Mr. Mike Van Milligen Page 2 Thank you for the opporturfity to pursue this project and your review of this material. Please feel free to contact me if there is any question and/or to authorize ECIA to prepare the amendment request. Sincerely, Mark Schneider Community Development Director cc: David Hartig Tim Pancmtz Encl. July 9, 2003 DAVID S. HARTIG, JR. P.O. Box 604 Dubuque, IA 52004-0604 (563) 583-0408 City ofDubuque Att~:MikeVanMilligen, CityManager 50West 13mSt. Dubuque, IA52001 RE: Old Mill Road properties Dear Mike: This letter is to confirm my intention to pay the City's required match in the Hazard Mitigation Gram Program (HMGP) to acquire the Pancratz Construction property located at 1650 Old Mill Road. I spoke with Mark Schneider of ECIA who provided me with the project budget status and estimated additional costs. My understanding is that the estimated match is $16,850.46 based on the following information. The purchase price to Mr. Pancratz will be $46,934.13. In addition to the purchase price, recording fees and dosing costs are estimated at $181.00 and additional legal work related to a long term lease is estimated at $500.00. Further the demolition work is estimated at $10,000.00. I further understand that the City has $32~264.67 available in state and federal funds in the HMGP program and that FEMA Public Assistance program will reimburse the City for 85% of the demolition costs. Therefore, the estimated costs for the acquisition will be $47,615.13 including the purchase price and closing and all legal fees and the available HMGP funds of $32,264.67 will be used toward the purchase. In addition, the demolition is estimated at $I0,000.00 and that FEMA Public Assistance will provide $8,500.00 (85%) toward this expense. The estimated sum total required match for the acquisition and demolition is $16,850.46. I am committing to provide the City's estimated $16,850.46 match toward this project. I further understand that this is an estimate and the actual match may be something slightly more or less than this estimate and commit to provide the final required match funds above or below this amount based on the actual costs upon project completion. I understand that the acquisition and demolition oftlxis property mum not result in the City of Dubuque incurring any expense whatsoever. In return for this commitment I desire to obtain a long term (99 years) lease from the City forths property (1650 Old Mill Road) and the 1620, 1695 and 1699 Old Mill Road properties that the City July 9, 2003 Mr. Mike Van Milligen Page 2 has already purchased through the HMGP program. I do understand that the City will record deed restrictions on the property that it must be maintained as open green space forever. The proposed budget includes $500.00 for the lease preparation. The lease would become effective as soon as the stmctures have been demolished and cleared from the properties, including the removal of all utilities including the abandoned wells. The ground is to be bare ground at the time of lease sigmng. I agree to assume respons~ility for seeding or sodding of all prop~ies, the placement of trees as I deem appropriate and the general maintenance of the property for the term of the lease. Thank you for your consideration of my offer and the opportunity to assist the City with this project and furore maintenance of these properties. Please feel free to contact me if there is any question regarding my offer. David Hartig Mark Schneider, ECIA t'im Pancratz