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November 12, 2019 — Meeting Minutes
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11-12-19 BOA Minutes November 12, 2019 Page 1 of 5
THE CITY OF CLAYTON
Board of Aldermen City Hall – 10 N. Bemiston Avenue November 12, 2019 7:00 p.m. Minutes
Mayor Harris called the meeting to order and requested a roll call. The following individuals were in attendance:
Aldermen: Joanne Boulton, Richard Lintz, Ira Berkowitz, Bridget McAndrew, and Susan Buse. Mayor Harris Interim City Manager Watson City Attorney O’Keefe
Absent: Mark Winings
Motion made by Alderman Lintz to approve the October 22, 2019 minutes. Alderman Boulton seconded. Motion to approve the minutes passed unanimously on a voice vote. PUBLIC REQUESTS AND PETITIONS
None
AN ORDINANCE TO CONSIDER APPROVING THE CLOSING OF SALE OF 8049 FORSYTH BOULEVARD AND RELATED ANCILLARY DOCUMENTS
Interim City Manager Watson reported that on September 5, 2019, 8049 Forsyth Acquisitions, LLC (“Forsyth”) and the City entered into an Agreement of Purchase and Sale (“Purchase Agreement”) concerning the sale of the City-owned property located at 8049 Forsyth Boulevard. The agreed upon price for the property under the Purchase Agreement is $2,625,000. The Purchase Agreement allows Forsyth until December 4, 2019 to obtain all necessary governmental approvals for its proposed project. In addition, the Purchase Agreement gives the City the right to terminate the Agreement if, in the exercise of a broad, discretionary standard of approval (the “City’s Approval Right”), the City does not approve the developer’s proposed project. Forsyth has not obtained its governmental approvals for its proposed project, and the City has not approved Forsyth’s proposed project pursuant to the City’s Approval Right.
In addition, the Purchase Agreement gives the City the right to terminate the Agreement if, in the exercise of a broad, discretionary standard of approval (the “City’s Approval Right”), the City does not approve the developer’s proposed project. Forsyth has not obtained its governmental approvals for its proposed project, and the City has not approved Forsyth’s proposed project pursuant to the City’s Approval Right. Nevertheless, Forsyth would like to close the sale of the Property, prior to obtaining such approvals and at their own risk, to permit Forsyth to complete a Section 1031 exchange prior to expiration of its six month replacement period due to expire on or about December 6, 2019 and to fulfil certain obligations to potential tenants. Section 1031 is a reference to Internal Revenue Code that allows the reinvestment of property sale proceeds into another with a lesser tax obligation. Interim City Manager pointed out revisions on the agreements provided to the Board.
11-12-19 BOA Minutes November 12, 2019 Page 2 of 5
Franz vonKaenel, Armstrong Teasdale, addressed the Board with concerns on the specific language in the Arts and Entertainment Agreement (page 2, Section 4.1). He requested to add the following: “The A&E venue may be temporarily closed for reasonable periods of time not to exceed six months in any consecutive three-year period, except with the City’s approval. Which approval shall not be unreasonably conditioned, delayed, or withheld as necessary for repurposing, renovations, repairs, condemnation, or events of Force Majeure” which will provide additional flexibility for the operation of the venue. City Attorney O’Keefe noted that the provision does not allow to put the space for other use. Alderman Buse suggested that if in fact there are a series of closures that hit a certain number within the 20-year period, the 20-year period could be extended which may benefit both the City and the developer. Jim Koman, US Capital, addressed the Board stating that the intent is to never close the space, but if that happens, he urges the Board to amend the current language in order to provide opportunity to be more flexible in order to find a successful use for the venue. Alderman Boulton stating that the current language states “four permitted closures...and any additional temporary closures…; as things change the current Board at that time can make decisions as reasonable. Mayor Harris stated that a three-year window is an improvement to the current language.