View the PDF version Google Docs PDF Viewer
4oas-412CP) CITY OF =~”@ MUSKEGON Agenda Item Review Form Muskegon City Commission Commission Meeting Date: May 27, 2025 Title: Municipal Services Agreement for Village at Park Terrace Acquisition Submitted by: Jake Eckhoim, Development Department: Economic Development Services Director Brief Summary: The existing ownership of Park Terrace Apartments and Village at Park Terrace Senior Apartments is seeking to sell the portfolio to new ownership. In order to preserve and lengthen the affordability period, a new Municipal Services Agreement is required for both projects. Detailed Summary & Background: Staff and the City Attorney's office have been working to finalize the draft agreements before you related to this project with the new owner. They hope to put significant capital investment into the facilities in the coming years, and in order to finance the project and make that possible they are requesting an updated and restated Municipal Services Agreement on both Park Terrace as well as the senior living component Village at Park Terrace. The agreement establishes a new Municipal Services Agreement of 2% of the annual shelter rent. This is to our advantage because the total MSA revenue stays with the City, rather than being split between the taxing jurisdictions like the PILOT payment. This document is the contract for housing exemption for up to 25 years, which will require adherence to MSHDA regulated rents per requirements in our local ordinance. Goal/Focus Area/Action Item Addressed: Key Focus Areas: Diverse housing types Goal/Action Item: 2027 Goal 2: Economic Development Housing and Business Amount Requested: Budgeted Item: NA Yes No N/A po Fund(s) or Accouni(s): Budget Amendment Needed: NA Yes No N/A a Recommended Motion: Motion to accept the Municipal Services Agreement for Village at Park Terrace Apartments as presented, and to authorize the Mayor and Clerk to sign. Approvals: Guest(s) Invited / Presenting: MUNICIPAL SERVICES AGREEMENT THIS MUNICIPAL SERVICES AGREEMENT (“Agreement”) is entered into on this day of May 27, 2025 (the “Effective Date”) between Village at Park Terrace Limited Dividend Housing Association, LLC, a Michigan limited liability company, its successors and/or assigns, whose address is 7451 N 63% St., Longmont, Colorado 80503 (the “Owner”) and the CITY OF MUSKEGON, 933 Terrace Street, Muskegon, MI 49440 (the “City”) is made pursuant to the following terms: RECITALS A. Owner will acquire property in the City of Muskegon more particularly described on Exhibit A attached hereto and intends to continue operating the project thereon (the “Project”) as a low-income housing project. B. The parties recognize that due to the high concentration of persons residing at the Project that the City will be providing a higher level and greater amount of Municipal Services (as defined in this Agreement) to the Project. C. The City, through its Police and Fire Departments and otherwise, provides Municipal Services within the City. The Project will have special needs for these types of Municipal Services and Owner acknowledges that such needs may be greater than typically situated residential developments. | D. The Owner desires to guarantee that certain Municipal Services will be provided to the Project until the term of the Amended and Restated Contract for Housing Exemption (hereinafter referred to as the “Contract for Housing Exemption”) for this Project expires, such Municipal Services to include, but not be limited to: 1. Emergency services, including police and fire services specifically administered through the City, and, on public streets and sidewalks, maintenance, repair, snow removal, and street lighting; also to include other matters as the City deems necessary; 2. Other miscellaneous services as may, from time to time, be mutually agreed to for the benefit of the Project; 3. Said municipal services shall be provided in the customary way and in accordance with all laws, rules and regulations of the United States of America, State of Michigan, County of Muskegon and City of Muskegon or other applicable jurisdictions or bodies. (All of the above collectively referred to as “Municipal Services”) 4. Nothing in this Agreement shall be deemed to waive any defense to claims based on sovereign or governmental immunity. AGREEMENT The parties agree as follows: 1. Provision of Services. The City will provide the Municipal Services to the Project. 2. Payment, The Owner shall pay a service charge on or before July 1, of each year following the Effective Date, during the time the Contract for Housing Exemption is in effect (the “Municipal Service Fee”). The Municipal Service Fee shall be two (2%) percent of the net rent adjusted for vacancies received annually, excluding project paid utilities, starting during the calendar year of the Effective Date. For the initial year and final years of the Term (hereinafter defined), the Municipal Service Fee shall be pro-rated based on the portion of the City’s fiscal year (July 1 — June 30) that falls on or after the Effective Date or on or before the Termination Date (hereinafter defined), as applicable. Term. The obligation for payment for Municipal Services shall commence as of the Effective Date and continue until the date that the Contract for Housing Exemption terminates (the “Termination Date”), not to exceed 25 years. The period from the Effective Date until Termination Date shall be referred to as the “Term.” This Agreement is contingent upon Owner acquiring the real property described in Exhibit A by September 1, 2025. If Owner fails to acquire the real property by this date, this Agreement will become null and void and have no further effect. Audit, Owner shall submit, upon request by the City, a copy of the annual audit of the Project prepared by an independent CPA along with the payment of the Municipal Service Fee, Exclusive Benefit. The obligations of the Owner hereunder are imposed solely and exclusively for the benefit of the City and no other person or entity shall have the standing to enforce such obligations or be deemed to be beneficiaries of such obligations. Remedies. The Owner agrees that if it does not perform its obligations under this Agreement the City is entitled to pursue any and all remedies legal or equitable that it is entitled to under Michigan law. The Owner agrees to be liable for all costs of collection including reasonable attorney's fees and costs incurred by the City in the enforcement of the terms of this Agreement, if Owner is found to be in default of this Agreement by a court of competent jurisdiction. Assignment. Upon the written consent of the City, the Owner may transfer or assign its rights and obligations under this Agreement to a buyer (“Transferee”) of the Project. The Transferee must agree to assume the Owner’s obligations under this Agreement. Upon assignment and assumption of this Agreement by the Transferee (or an affiliate, as provided below), the Owner shall be relieved of any further liabilities or obligations accruing under this Agreement. Notwithstanding the foregoing, the Owner may assign this Agreement, without the written consent of the City, to an affiliate of Owner (provided that such affiliate agrees to assume the Owner’s obligations hereunder and provided that the Owner and assignee give prior notice of the assignment to the City with evidence that the assignee has agreed to assume the obligations of the Owner). 8. Severability. If any term or condition of this Agreement is found to be void, invalid, or unenforceable, the validity or enforceability of the remaining terms and conditions shall not be affected or impaired and will continue in full force and effect. 9. Notices. All notices under this Agreement must be in writing and sent to the respective parties as follows: If to Owner: Liam Moor LLC Attention: Michael Dalen 7451 N 63rd St. Longmont, CO 80503 If to the City: City of Muskegon ‘Attn: City Manager 933 Terrace Street Muskegon, MI 49440 With copy to: Parmenter Law Attn: City Attorney 601 Terrace St. Muskegon, MI 49440 Every notice must be in writing and sent by one of the following methods: a. Personal delivery, in which case delivery shall be deemed to occur the day of the delivery. b. Certified or registered mail, postage prepaid, return receipt requested, in which case delivery shall be deemed to occur the day it is officially recorded by the U.S. Postal Service that is has delivered it to the intended recipient; or c. Next day delivery by a recognized private delivery service such as Federal Express, providing proof of mailing and delivery comparable to certified or registered mail, return receipt requested, in which case delivery shall be deemed to occur upon delivery as recorded by the delivery service. Either party may change the address provided in this paragraph for itself or its attorney by providing notice of such change to the other party as required in this paragraph. 10. No Waiver. No delay, omission, or failure of the City to act under this Agreement or to insist upon strict compliance with any term and condition of this Agreement, and no custom or practice of the parties at variance with the terms and conditions of this Agreement shall constitute a waiver of City’s right to demand exact compliance with this Agreement. No waiver of any right or remedy of City shall be construed as a bar to or a waiver of any such right or remedy on any future occasion. 11. Headings. The headings in this Agreement have only been inserted for convenience and shall not affect the meaning or interpretation of this Agreement. No heading shall have any legal significance of any nature whatsoever. 12. Binding Effect. This Agreement shall be binding on the parties, their heirs, successors, and assigns. 13. Amendments. There shall be no modification or amendments to this Agreement, including this section, unless they are in writing and signed by all the parties to this Agreement. 14, Governing Law. This Agreement has been executed in the State of Michigan, and shall be governed by Michigan law. 15. Complete Agreement. This Agreement contains the entire agreement between the parties and supersedes all prior oral or written representations, negotiations and agreement on the subject matter stated herein. {Signatures on next page} Municipal Services Agreement Signature Page IN WITNESS WHEREOF, this Municipal Services Agreement is executed as of the day and year first written above. CITY: CITY OF MUSKEGON Dated: Hos x , 2025 By: V_— Sie "Ken Johngon, Mayor Dated: S78, , 2025 iY Ad 23‘Ann Meisch, City Clerk OWNER: Village at Park Terrace Limited Dividend Housing Association, LLC a Michigan limited liability company By Liam Fund wy epee By: ty a Name: Adam Stein Its: Manager EXHIBIT A LEGAL DESCRIPTION [See Attached| That part of RUDDIMAN TERRACE, Section 36, Town 10 North, Range 17 West, as recorded in Liber 12 of Plats on Pages 33 and 34, described as beginning at a point on the North line of Hackley Avenue which is North 00 degrees 00 minutes 00 seconds East 33.00 feet along the North- South 1/4 line of said Section 36 and South 89 degrees 58 minutes 00 seconds West 383.75 feet from the Central 1/4 corner of said Section 36; thence South 89 degrees 58 minutes 00 seconds West 60.67 feet; thence Southwesterly 506.96 feet along the arc of a 510.50 foot radius curve to the left said curve having a central angle of 56 degrees 53 minutes 54 seconds, and the chord of which bears South 61 degrees 31 minutes 01 seconds West 486.38 feet; thence North 56 degrees 20 minutes 00 seconds West 392.08 feet; thence North 33 degrees 40 minutes 00 seconds East 15.07 feet; thence Northeasterly 844.98 feet along the arc of a 890.90 foot radius curve to the right, said curve having a central angle of 54 degrees 20 minutes 33 seconds, and the chord of which bears North 60 degrees 50 minutes 17 seconds East 813.66 feet; thence South 09 degrees 34 minutes 32 seconds East 186.05 feet; thence North 90 degrees 00 minutes 00 seconds East 64.57 feet; thence South 00 degrees 00 minutes 00 seconds East 210.93 feet to the Point of Beginning.
Sign up for City of Muskegon Emails