Fiscal Note
The proposed resolution authorizes an amendment to the development agreement with Starkweather, LLC to assist in the development and sale of 13 shovel-ready lots at the former Voit Farm property. The original agreement between Starkweather, LLC and the City, authorized by Common Council in May 2025 via RES-25-00299 (file # 87871), established Starkweather’s responsibilities in construction and delivery of saleable housing lots as well as the City’s level of TIF financial assistance to said housing developers. Additional grading costs and the need to construct a stormwater retention basin adjacent to one of the lots have increased the infrastructure costs. The amendment to this agreement modifies the previously established maximum sales prices and infrastructure cost framework to recognize increases in costs that the Developer has or will incur in the development of the Property to determine whether housing developers require TIF assistance, such that, but for TIF assistance, the project(s) would not occur. The attached Exhibit A reflects the amended maximum sales prices for the lots. Lots 6, 9-10, and 13 will be purchased by the City for landbanking purposes per the original agreement; the sales prices for those lots have not changed from the original agreement.
TID 55 is a mixed-use TID, which allows a maximum of 20 years to collect tax increments to pay for project costs. Future amendments may be required to authorize funding for subsequent projects proposed by developers, including the Community Development Authority or the City, to purchase shovel-ready lots in the Project, through land banking. Future amendments of the TID 55 Project Plan may occur over time, in the event that the TID performs beyond financial expectations and additional TIF assistance is required for future housing development or infrastructure improvements.
No additional appropriation is required with adoption of this resolution.
Title
Amending RES-25-00299 (Legistar #87871) authorizing the execution of a development agreement with Starkweather, LLC regarding the development of the former Voit Farm property in Tax Incremental District #55 (Voit). (District 15)
Body
WHEREAS, Starkweather Group LLC, (“Developer”) has proposed to develop 25 acres of the former Voit Farm property, located at the northeast quadrant of the intersection of Milwaukee Street and North Fair Oaks Avenue in the City of Madison (the “Property”) and within the boundary of TID #55 (Voit), for housing and mixed-use development, including implementing required public improvements to 13 platted lots (the “Project”); and
WHEREAS, the City and Developer have negotiated terms for a development agreement (the “Development Agreement”) that memorialized the City’s commitment to creating TID 55, commitments by the Developer regarding development of the Project, and how the City will allocate of land acquisition and infrastructure costs for purposes of future TIF applications for individual housing development projects located on the Property; and
WHEREAS, on May 6, 2025, the Common Council adopted a resolution authorizing the City’s execution of the Development Agreement consistent with the terms of a term sheet attached to resolution RES-25-00299 (the “Term Sheet”); and
WHEREAS the Developer has identified an additional $1,200,000 of additional grading costs associated with environmental cleanup (the “Additional Grading Costs”) and $1,000,000 of additional costs related to the construction of a stormwater retention basin adjacent to Lot 5 of the Project (the “Additional Stormwater Costs”) (collectively, the “Additional Costs”) which will increase the total cost of the Project to $22,200,000; and
WHEREAS based upon further negotiation, staff have been instructed to allocate the Additional Grading Costs in a proportionate manner across the remaining saleable lots and allocate the Additional Stormwater Costs to Lot 5 in the Development Agreement, consistent with the table attached as Exhibit A;
NOW, THEREFORE, BE IT RESOLVED that the City hereby finds and determines that the Project is consistent with the public purposes of Tax Increment Finance Law and the plans and objectives set forth in City of Madison TIF Policy, the amendment to the Development Agreement is hereby approved.
BE IT FURTHER RESOLVED that the Mayor and City Clerk are authorized to execute the Development Agreement with the Developer, or its assigns, on substantially, though not exclusively, the terms reflected in the Term Sheet approved by RES-25-00299, with the exception of replacing the “Maximum Sales Price” figures in Section 4 of the Term Sheet with figures reflected in the attached Exhibit A, and in a form approved by the City Attorney.