Title
Authorization to Amend Development Agreement with Grand Canyon University (City Contract 142412) (Ordinance S-52622) - District 5
Description
Request to authorize the City Manager, or his designee, to amend City Contract 142412 with Grand Canyon University, or its City-approved designee, to extend the term, add additional items to the eligible infrastructure list and make other modifications. Further recommend approval for the City Controller to disburse funds related to this item.
Report
Summary
The City and Grand Canyon University (GCU) entered into a development agreement (Agreement) in 2016 to facilitate the continued growth of the university. The Agreement allowed for reimbursement by the City for public infrastructure improvements constructed by GCU utilizing eligible transaction privilege tax (TPT) generated from certain construction or campus activities. The initial term of the Agreement required GCU to complete all improvements by June 30, 2025, but allowed GCU to request reimbursement from revenue generated through April 30, 2028, up to a maximum of $19 million. The initial term of the Agreement has resulted in GCU building a total of $16,423,954.15 in public infrastructure ranging from new streets, traffic signals and upgraded public safety cameras, and new sewer infrastructure to serve the entire area.
The parties would like to amend the Agreement to extend the term for an additional ten years, requiring GCU to begin the process for any new eligible public infrastructure by June 30, 2035, and allow GCU to request reimbursement from revenue generated by April 30, 2038. GCU would have 180 days following the City’s written acceptance or final approval of any completed, specific agreed-upon infrastructure to provide the City a written request for reimbursement. A maximum of $38 million, including revenue generated during the initial term of the Agreement, would be eligible for reimbursement from four sources:
- A maximum of 50% of the City’s eligible General Fund portion of Construction Sales Tax, collected by GCU and its subsidiaries.
- A maximum of 100% of the City’s eligible dedicated T2050 portion of Construction Sales Tax, collected by GCU and its subsidiaries.
- A maximum of 50% of the City’s eligible General Fund portion of Operations Sales Taxes collected over and above levels from operations in 2014 by GCU and its subsidiaries.
- A maximum of 100% of the City’s eligible dedicated T2050 portion of Operations Sales Taxes collected over and above levels from operations in 2014 by GCU and its subsidiaries.
The parties have also agreed to expand the area of applicability to include the area generally bounded by Bethany Home Road on the north, the eastern edge of the Interstate 17 (I-17) right-of-way on the east, Campbell Avenue on the south, and 39th Avenue on the west; the City-owned golf course located on the northwest corner of 59th Avenue and Indian School Road that is managed by GCU; and the area within 200 feet of the boundary of the GCU Golf Course. GCU also agreed to provide notice of any rezoning or building application for new property acquired and allow any resident families with K-12 school aged children to remain until the end of the then-current academic school year.
Under the terms of the Agreement, GCU will be responsible for the design, engineering, construction, acquisition and dedication of public improvements potentially including traffic signals, ADA compliant ramps, water or sewer improvements, traffic calming and street lighting improvements.
Financial Impact
Project-generated TPT is only available for actual public infrastructure completed by GCU and accepted by the City during the term of the Agreement.
Concurrence/Previous Council Action
On July 1, 2015, City Council approved Ordinance S-41921 that authorized City Contract 142412.
Location
Generally, Bethany Home Road on the north, the eastern edge of the I-17 right-of-way on the east, Campbell Avenue on the south, and 39th Avenue on the west, as well as the area within 200 feet of the GCU Golf Course.
Council District: 5
Department
Responsible Department
This item is submitted by Assistant City Manager Ginger Spencer and the Community and Economic Development Department.