Title
Development Agreement with Legacy Sports Arena, LLC for Public Infrastructure Reimbursements (Ordinance S-46109)
Description
Request to authorize the City Manager, or his designee, to enter into a development agreement, and to execute any other instruments or documents as necessary, with Legacy Sports Arena, LLC (Developer), or its City-approved designee, to reimburse certain public infrastructure improvements related to the development of a privately-funded amateur sports arena and hotel. Also request authorization for the City Controller to disburse up to $800,000 as reimbursement to the Developer for public infrastructure improvements. Funding is available in the Strategic Economic Development Fund.
Report
Summary
Legacy Sports Arena, LLC (Developer) proposes to develop an approximately 171,000-square-foot amateur sports arena and 58,700-square-foot hotel on a vacant 20-acre parcel where Bronco Butte Trail presently ends, just west of North Valley Parkway. The arena will accommodate approximately 1,500 spectators (but in no event more than 6,000 spectators sitting/standing combined) with two regulation-sized ice rinks, five each volleyball and basketball courts, as well as retail and restaurant amenities. The hotel is expected to have 88 rooms.
The arena is planned to accommodate other activities as well, from soccer to pickleball, and will provide a variety of amenities to both athletes and spectators. The hotel is planned to cater to local visitors, business travelers, and athletes and their families participating in tournaments, sports camps and other special events at the arena.
This project will create hundreds of jobs and attract thousands of visitors while generating new public revenues and providing amenities for Phoenicians. To accommodate these new jobs and visitors, new public infrastructure improvements will be required, including extending Bronco Butte Trail through the site.
Under the proposed development agreement, the Developer will be required to design and construct the arena, hotel and public infrastructure improvements to the City’s standards and in compliance with all applicable laws, including Arizona Revised Statutes Title 34 for the public infrastructure improvements. After the public infrastructure improvements are completed by the Developer, and the City approves and accepts such improvements, then the City would reimburse the developer up to $80,000 annually for up to 10 years. The total reimbursement will not exceed the actual costs of the public infrastructure improvements or $800,000, whichever is less. The development agreement shall contain other terms and conditions as determined by City staff.
Public infrastructure improvements eligible for reimbursement include street and roundabout improvements along Bronco Butte Trail in existing or future rights-of-way granted to, and owned by the City relating to the project, which may include street lighting, landscaping, sidewalks and similar improvements. These public improvements will not only serve the project, but will also benefit the surrounding area, including both existing development and developable land, resulting in enhanced opportunities for economic development and efficient traffic flow meeting current City standards.
The project will have a significant economic impact including an estimated direct tax revenue to the City of approximately $5.2 million over the first 10 years, and $20.5 million for all taxing jurisdictions.
Contract Term
The term of the agreement will be for up to 10 years, with no extension options.
Financial Impact
The City will reimburse the Developer for the construction of eligible public infrastructure improvements in an amount not to exceed $80,000 annually for up to 10 years, not to exceed $800,000 total. City reimbursements would only occur after the City approves and accepts such public infrastructure improvements. Funding is available in the Strategic Economic Development Fund.
Concurrence/Previous Council Action
This item was recommended for approval by the Workforce and Economic Development Subcommittee at the Sept. 25, 2019 meeting by a vote of 4-0.
Location
Bronco Butte Trail from North Valley Parkway west to and through the project site at 2727 W. Bronco Butte Trail.
Council District: 2
Department
Responsible Department
This item is submitted by Assistant City Manager Deanna Jonovich, Deputy City Manager Mario Paniagua, and the Street Transportation and Community and Economic Development departments.