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Posted: May 24, 2019
Rapid City
Agenda Item Summary

Agenda Item Ref. #: LF052919 08

Agenda Item Title:

Approve Resolution No. 2019-044 a Resolution Authorizing the City to Purchase Certain Real Property and Upon Completion of the Property Acquisition Execute a Lease with OneHeart to Operate a Transformation Campus with Transitional Housing and Other Support Services on the Property.

Origination Group:
Legal & Finance Committee
Origination Meeting Date:
05/29/2019
City Council Hearing Date:
06/03/2019
Petitioner:
OneHeart
Staff Contact:
Joel Landeen, City Attorney
Location:
Old NAU Campus
Agenda Item Summary:
The City and OneHeart are ready to move forward with the purchase of a portion of the former NAU campus with the Vision funds previously authorized by the City Council. Approving this resolution will authorize the Finance Office to issue a check we can use to close on the property and allow the City to accept the deeds. Since the total purchase price of $5 million was spread over 2019 and 2020, OneHeart has received authorization to use a portion of the money it has raised for renovation of the property to cover the balance of the purchase price with the agreement that the portion of the City’s share they are paying will be reimbursed to them in 2020. Since the property currently has tenants and the City does not have the ability to manage the property, the resolution also authorizes the Mayor to execute the attached lease immediately upon the City taking ownership of the property. OneHeart will manage the property and collect the income generated in order to facilitate the property’s transition from its current uses to its intended use as a transformational campus and transitional housing. The parties hope to finalize the purchase prior to the end of June.

Funding Source & Fiscal Impact (if applicable):

Funding Cost Center
The funding source is the Vision Account. The City will expend the $3,857,628 authorized from the Vision Account in 2019 at the time of purchase and OneHeart will pay the balance of the purchase price out of its own funds. The City will expend the remaining $1,142,372 from the Vision Account authorized in 2020 to reimburse OneHeart for the remainder of the City’s share of the purchase price that OneHeart covers at closing.

Recommendations:

Origination Recommendation Action:
Approve
Origination Recommendation Notes:
This project was recommended by the Vision Citizen Committee and the City Council approved expending the funds from the Vision Account on March 18, 2019.
City Council Options:
Approve as presented or deny. If you approve we will proceed to closing to finalize the purchase of the property and execute the lease agreement immediately following the purchase. It is anticipated that we will complete the purchase of the property by the end of June. If you deny, the property will not be purchased and the future of the entire project will be in jeopardy.
Published in 2019 - LF Agenda Items
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