Fiscal Note
The proposed resolution authorizes an amendment to the Economic Development Division's (EDD) 2026 Adopted Capital Budget for the Land Banking program (#12640). The amendment adds $4.0 million in TID 44-supported GO borrowing to the program. The proposed resolution further authorizes the execution of a Purchase & Sale Agreement for the City to acquire property for the purposes of land banking. The estimated acquisition, holding, demolition, environmental testing, and pre-development costs for the property is $6.2 million. Estimated costs include:
$5.2 million for acquisition
$40,000 for environmental site assessment, title work, and miscellaneous closing costs
$60,000 for property holding costs
$50,000 for demolition costs
$850,000 for pre-development costs
With approval of the amendment to the Economic Development Division's (EDD) 2026 Capital Budget, funds for the purchase, holding, demolition, and pre-development costs of the property will be available in the 2026 Capital Budgets of the Parks Division and EDD. The Land Acquisition capital program (#17128) within the Parks Division budget has $680,000 available for these costs. The Land Banking capital program (#12640) will contribute $5.52 million: $1.52 million from GO Borrowing already authorized within the program, and $4.0 million to be funded by TID 44-supported borrowing.
Title
Amending the 2026 EDD Land Banking program to add $4.0 million of GO Borrowing supported by TID 44 and authorizing the execution of a Purchase and Sale Agreement with RDC Development, LLC, or their successors and assigns, for the purchase of seventeen properties addressed as 404 Cottage Grove Road; 514, 526, 533 & 551 Pinney Street; 3752 Sargent Street; 3708 Olbrich Avenue; 702, 804, 808, 812, 816, 820, 824, 828 & 832 Royster Avenue, and 501 Grand Oak Trail, Madison, WI 53714 for land banking purposes, and authorizing the expenditure of funds for environmental assessment, title work, closing costs, holding costs, any necessary demolition work, and pre-development costs for the same property, all totaling $6.2 million (District 15).
Body
WHEREAS, RDC Development, LLC (the “Seller”) is the owner of properties located at 404 Cottage Grove Road; 514, 526, 533 & 551 Pinney Street; 3752 Sargent Street; 3708 Olbrich Avenue; 702, 804, 808, 812, 816, 820, 824, 828 & 832 Royster Avenue, and 501 Grand Oak Trail, Madison, WI 53714 containing 407,621 square feet or 9.36 acres of land, as legally described in Exhibit A of the Purchase and Sale Agreement attached hereto (the “Agreement”) and depicted on Exhibit B to the Agreement (the “Property”); and,
WHEREAS, the City of Madison (the “City”) desires to purchase the Property for land banking purposes that are contemplated in the proposed Southeast Area Plan; and,
WHEREAS, the City’s acquisition of the Property would provide expanded opportunities for the City to guide future housing and commercial development; and,
WHEREAS, the Seller agrees to sell the Property to the City in accordance with the terms of the Agreement, which has been executed by the Seller, for a purchase price of $5.2 million, which was negotiated based on an appraisal approved by the City’s Office of Real Estate Services; and,
WHEREAS, additional acquisition costs, including an environmental site assessment, title work, and miscellaneous closing costs are estimated to total $40,000; and,
WHEREAS, following the City’s acquisition of the Property, $110,000 of holding costs and demolition costs are anticipated; and,
WHEREAS, following the acquisition of the Property, $850,000 of pre-development costs are anticipated.
NOW, THEREFORE, BE IT RESOLVED that the City’s Common Council hereby authorizes the City’s execution of the Agreement, as Buyer, for the purchase of the Property on substantially the same terms and conditions contained in the Agreement attached hereto; and,
BE IT FURTHER RESOLVED that EDD's 2026 Adopted Capital Budget be amended to add $4.0 million to the Land Banking program (#12640) in the form of TID 44-supported GO Borrowing; and,
BE IT FURTHER RESOLVED that funding from TID 44 shall be spent on TID-eligible expenses: $3.5 million for the purchase of the Property, $40,000 for due diligence including environmental site assessment and closing expenses including title work to accomplish the purchase of the Property, $60,000 for holding costs, $50,000 for demolition costs and $350,000 for pre-development costs; and,
BE IT FURTHER RESOLVED that the remaining $2.2 million in estimated costs will be supported by funding available in the Parks Division's Land Acquisition capital program (#17128) and GO Borrowing authorized in EDD's Land Banking capital program (#12640); and,
BE IT FINALLY RESOLVED that the Mayor and City Clerk are authorized to sign, accept, and record any and all documents and legal instruments required to complete the transactions contemplated in this resolution, on a form and in a manner that has been approved by the City Attorney.