St. Joseph County Brownfield Redevelopment Authority ...This Brownfield Plan Amendment (“Plan Amendment”) serves as an amendment to St. Joseph County ’s existing Brownfield Plan,

St. Joseph County Brownfield Redevelopment Authority Brownfield Plan Amendment Prepared for Midwest V, LLC

Approved by the St. Joseph County Brownfield Redevelopment Authority 9/24/2020

Approved by the St. Joseph County Board of Commissioners

Prepared with the assistance of: Fishbeck 1515 Arboretum Drive SE Grand Rapids, Michigan 49546 616-464-3876

Table of Contents Fishbeck | Page i

1.0 Introduction ...................................................................................................................................................1

1.1 Proposed Redevelopment and Future Use for Each Eligible Property ..............................................1

1.2 Eligible Property Information ............................................................................................................1

2.0 Information Required by Section 13(2) of the Statute ...................................................................................1

2.1 Description of Costs to Be Paid for With Tax Increment Revenues ..................................................1

2.2 Summary of Eligible Activities ...........................................................................................................2

2.3 Estimate of Captured Taxable Value and Tax Increment Revenues ..................................................3

2.4 Method of Financing and Description of Advances Made by the Municipality ................................3

2.5 Maximum Amount of Note or Bonded Indebtedness .......................................................................3

2.6 Duration of Brownfield Plan Amendment .........................................................................................3

2.7 Estimated Impact of Tax Increment Financing on Revenues of Taxing Jurisdictions ........................3

2.8 Legal Description, Property Map, Statement of Qualifying Characteristics and Personal Property ..3

2.9 Estimates of Residents and Displacement of Individuals/Families ....................................................4

2.10 Plan for Relocation of Displaced Persons ..........................................................................................4

2.11 Provisions for Relocation Costs .........................................................................................................4

2.12 Strategy for Compliance with Michigan’s Relocation Assistance Law ...............................................4

2.13 Other Material that the Authority or Governing Body Considers Pertinent .....................................4

List of Figures

Figure 1 – Location Map

Figure 2 – Site Layout Map

List of Tables

Table 1 – Summary of Eligible Activities Costs and Schedule

Table 2 – Tax Increment Revenue Capture

Table 3 – Tax Increment Revenue Reimbursement Allocation

List of Attachments

Attachment A Conceptual Renderings

Attachment B Environmental Data Tables and Map

Attachment C Resolution’s Approving the Brownfield Plan Amendment (Burr Oak Township, St. Joseph County

BRA, St. Joseph County Board of Commissioners)

Attachment D Reimbursement Agreement

August 26, 2020 Fishbeck | Page 1

1.0 Introduction

The St. Joseph County Brownfield Redevelopment Authority (the “Authority” or SJCBRA) was established by St.

Joseph County pursuant to the Brownfield Redevelopment Financing Act, Michigan Public Act 381 of 1996, as

amended (“Act 381”). The primary purpose of Act 381 is to encourage the redevelopment of eligible property by

providing economic incentives through tax increment financing for certain eligible properties.

This Brownfield Plan Amendment (“Plan Amendment”) serves as an amendment to St. Joseph County ’s existing

Brownfield Plan, allowing inclusion of eligible property, as described in Sections 1.1 and 1.2 below. Incorporation

of eligible property into the County’s Brownfield Plan permits the use of tax increment financing to reimburse

Midwest V, LLC (“Developer”) for the cost of eligible activities required to redevelop the eligible property. Refer to

Attachment C for copies of the resolutions from the required municipal entities approving the Plan Amendment.

1.1 Proposed Redevelopment and Future Use for Each Eligible Property

The Developer proposes to redevelop a former commercial building located at 32469 US 12 and an adjacent

vacant parcel, Burr Oak Township, Michigan, parcels 75-001-035-005-02 and 75-001-035-005-03) (the

“Property”). Currently the property consists as two contiguous which will be combined into one parcel for the

purposes of the redevelopment. Redevelopment plans include demolition of an existing structure followed by

the construction of a new approximately 9,100 square foot commercial building (the “Project”). The building will

be used as a Dollar General store. Private investment into the Project is projected to be $1,200,000.

Approximately 7-10 new full-time equivalent jobs will be created, some part time seasonal jobs are anticipated.

Asbestos abatement, due care, and demolition activities are expected to commence in late summer 2020. Project

construction is anticipated to be complete by winter 2020.

1.2 Eligible Property Information

The Property consists of two parcels totaling approximately 3.27 acres at the southwest corner of US-12 (Chicago

Road) and Halfway Road in Burr Oak Township, St. Joseph County, Michigan. A vacant, blighted one story 3,600

sq. ft. former restaurant building constructed in the 1960s remains on the Property. The Property was used as

agricultural land prior to the 1960s. The business closed in 2014-2015 and has been used for storage since then.

Fishbeck conducted a Phase I Environmental Site Assessment (ESA) in June 2020. As part of the Phase I ESA, St.

Joseph County Health Department records were reviewed and identified the presence of nitrates in the site’s

drinking water well. The nitrate concentrations exceed Generic Residential Cleanup Criteria (GRCC) developed

pursuant to Part 201 of Public Act 451, 1994, as amended (“Part 201”). Based on the documented presence of

contaminants at concentrations exceeding EGLE Part 201 GRCC, the Property is a “facility” pursuant to Part 201.

As the Property is identified as a “facility”, the Property is considered an “eligible property” as defined by Act 381,

Section 2.

Maps depicting the location and layout of the Property are attached as Figures 1 and 2. Environmental data

tables and information related to the water well are provided in Attachment B.

2.0 Information Required by Section 13(2) of the Statute

2.1 Description of Costs to Be Paid for With Tax Increment Revenues

The Developer will seek tax increment financing from available local taxes for eligible activities at the Property

including Baseline Environmental Assessment (BEA) preparation (including a Phase I ESA), an asbestos survey,

Documentation of Due Care Compliance, asbestos abatement, demolition, additional due care requirements


(related to the water well), contingency, Plan Amendment preparation totaling $74,575. The table below

provides an eligible activity cost summary. Refer to the attached Table 1 for a detailed list of eligible activities and

associated costs.

Eligible Activity Estimated Cost

Pre-Approved Activities (Phase I ESA, Asbestos Survey,

Baseline Environmental Assessment (BEA), and Documentation

of Due Care Compliance) $7,450

Additional Due Care Activities (related to the water well) * $2,000

Asbestos Abatement* $2,000

Demolition* $50,000

Contingency (no more than 15%) * $8,625

Eligible Activities Sub-Total $70,075

Brownfield Plan Amendment Preparation $4,500

SJBRA Administrative Fees ($2,500 for the first 2 years then

$500 per year for the remainder of the Plan duration) $11,500

SJBRA LBRF $39,347

LOCAL ONLY ELIGIBLE ACTIVITIES TOTAL COST $125,422

*Eligible activities utilized for contingency calculation

2.2 Summary of Eligible Activities

Eligible activities included in this Plan Amendment as defined in MCL 125.2652 of Act 381 consist of the following:

Pre-Approved Activities: These activities are permitted to occur prior to Plan Amendment approval (MCL

125.2663b, Sec. 13b.). Preparation of a Baseline Environmental Assessment (BEA) and Documentation of Due Care

Compliance Report (DDCCR), including a Phase I ESA, is necessary to protect the new Property owner/Developer

from liability for environmental contamination. The BEA and DDCCR will be completed in accordance with Part 201.

An asbestos survey will be conducted prior to demolition, as required by applicable regulatory agencies.

Additional Due Care Activities (related to the water well): These activities represent the extra requirements and

incremental cost needed to install a new drinking water well on contaminated property.

Plan Amendment Preparation: To implement tax increment financing for this Project under Public Act 381 of 1996,

as amended, the preparation and development of this Plan Amendment is required.

Asbestos Abatement: Prior to building demolition, asbestos must be abated in accordance with applicable

regulatory guidelines.

Demolition: The Property contains a 3,600 sq. ft. dilapidated and blighted commercial structure. Demolition of the

structure will remove a potential safety hazard and facilitate Property redevelopment.

SJCBRA Administration: The SJCBRA will be responsible for the administration of this Plan Amendment.

Administrative fees have been included in this Plan Amendment to reimburse the SJCBRA for costs incurred.


2.3 Estimate of Captured Taxable Value and Tax Increment Revenues

For the purposes of this Plan Amendment, the base year is 2020. The 2020 taxable value of the eligible property

is $29,188. After completion of the development, the taxable value is estimated at $400,000. This Plan

Amendment assumes a 1% annual increase in the taxable value of the eligible property. Initial capture is

anticipated to begin in 2021.

The estimated captured taxable value for the redevelopment by year and in aggregate for each taxing jurisdiction

is depicted in tabular form (Table 2: Tax Increment Revenue Capture). Actual taxable values and tax increment

revenues may vary year to year based on economic and market conditions, tax incentives, building additions, and

property improvements, among other factors.

A summary of the estimated reimbursement schedule by year and in aggregate is presented as Table 3: Tax

Increment Revenue Reimbursement Allocation. This plan allows the BRA to capture up to 5-years of tax capture

beyond developer reimbursement for deposit into a Local Brownfield Revolving Fund (LBRF) once established.

2.4 Method of Financing and Description of Advances Made by the Municipality

The cost of the eligible activities included in this Plan Amendment will initially be paid for by the Developer. The

Developer will seek reimbursement for eligible activity costs through capture of available local tax increment

revenues as permitted under MCL 125.2663b of Act 381. Refer to Attachment for a copy of the Reimbursement

Agreement.

2.5 Maximum Amount of Note or Bonded Indebtedness

Bonds will not be issued for this Project.

2.6 Duration of Brownfield Plan

The duration of the Plan Amendment is estimated at a total of 15 years (including the LBRF capture), with

anticipated capture of tax increment revenues commencing in 2021 and ending in 2035.

2.7 Estimated Impact of Tax Increment Financing on Revenues of Taxing

Jurisdiction

The estimated amount of tax increment revenues to be captured for this redevelopment from each taxing

jurisdiction by year and in aggregate is presented in Tables 2 and 3.

2.8 Legal Description, Property Map, Statement of Qualifying Characteristics and

Personal Property

The Property in this Plan Amendment consists of two parcels described below and depicted on Figure 2.

The subject property is located in the Northeast ¼ of the Southwest ¼ of Section 35, Town 7 South, Range 9 West,

Burr Oak Township, St. Joseph County, Michigan. The larger of the two parcels is addressed as 32469 US-12. The

current parcel identification numbers are 75-001-035-005-02 (32469 US-12) and 75-001-035-005-03

(unaddressed parcel). These parcels will likely be combined into one parcel number once the redevelopment is

completed.

The legal descriptions are as follows:

Parcel # 001-035-005-02 COM CEN SEC 35 T7S R9W TH S 0D 41M W 303.75 FT TH N 89D 19M W 222.39 FT TH N

29D 17M 30S W 222.39 FT TO C/L US-12 TH N 60D 42M 30S E 99.02 FT ALG C/L TH NELY ALG CRV R 285.50 FT TO

N & S 1/4 LN TH S 0D 41M W 80.29 FT TO POB.


Parcel 001-035-005-03 COM CEN SEC 35 T7S R9W TH S 303.75 FT TO POB TH S 55.96 FT TH N 89D 19M W 400 FT

TH N 210.24 FT TO C/L US-12 TH N 60D 42 30 E ALG C/L 76.77 FT TH S 29D 17M 30S E 222.39 FT TH S 89D 19M E

222.39 FT TO POB. SUBJ TO HWY R/W.

The Property is considered an “eligible property” as defined by Act 381 because the Property is a facility pursuant

to Part 201.

2.9 Estimates of Residents and Displacement of Individuals/Families

No residents or families will be displaced because of the Project.

2.10 Plan for Relocation of Displaced Persons

Not applicable.

2.11 Provisions for Relocation Costs

Not applicable.

2.12 Strategy for Compliance with Michigan’s Relocation Assistance Law

Not applicable.

2.13 Other Material that the Authority or Governing Body Considers Pertinent

The Project will significantly improve the overall use of the Property by removing a vacant blighted structure,

mitigating environmental exposure risks, and improve the Property with a new commercial retail business.

Developer investment will result in significant economic benefit to the community, including a substantial

increase in tax base and the creation of new jobs.

Figure 1 Location Map

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Table 1 Summary of Eligible Activities Costs and Schedule

Table 1 - Summary of Eligibile Activities Costs

Midwest V, Redevelopment

32469 US-12, Burr Oak, St. Joseph County, Michigan

Total Reimbursable Tax

Capture

EGLE Act 381 Eligible

Activities

Pre-Approved Activities

Phase I ESA $2,100 $2,100 $2,100

Pre-Demolition Asbestos Survery $1,850 $1,850 $1,850

Baseline Environmental Assessment* $1,500 $1,500 $1,500

Documentation of Due Care Compliance* $2,000 $2,000 $2,000

Environmental Activities

Additional Due Care Activities (related to water well)* $2,000 $2,000 $2,000

Non-Environmental Activities

Asbestos Abatement* $2,000 $2,000 $2,000

Building Demoliton* $50,000 $50,000 $50,000

Brownfield Plan Preparation

Brownfield Plan Preparation $4,500 $4,500 $4,500

Eligible Activities Sub-Total $65,950 $65,950 $65,950

Contingency (15%)* $8,625 $8,625 $8,625

St. Joseph County BRA Administration $11,500

St. Joseph County LBRF $39,347

Total $74,575 $74,575 $125,422

* Eligible Activities for contingency calculation

Eligible Activities Total TIF CaptureDeveloper Incurred Costs

Table 2 Tax Increment Revenue Capture

Table 2 - Estimate of Total Incremental Taxes Available for Capture

Midwest V, LLC Redevelopment


1 of 2

Estimated Taxable Value (TV) Increase Rate: 1%

Plan Year 1 2 3 4 5 6 7 8 9

Calendar Year 2020 2021 2022 2023 2024 2025 2026 2027 2028

Base Taxable Value 29,188$ 29,188$ 29,188$ 29,188$ 29,188$ 29,188$ 29,188$ 29,188$ 29,188$

Estimated New TV -$ -$ 400,000$ 404,000$ 412,080$ 420,322$ 428,728$ 437,303$ 446,049$ 454,970$

Incremental Difference (New TV - Base TV)1

-$ -$ 370,812$ 374,812$ 382,892$ 391,134$ 399,540$ 408,115$ 416,861$ 425,782$

School Capture Millage Rate

State Education Tax (SET) 6.00000 -$ -$ 2,225$ -$ -$ -$ -$ -$ -$ -$

School Operating Tax 18.00000 -$ -$ 6,675$ -$ -$ -$ -$ -$ -$ -$

School Total 24.0000 -$ -$ 8,899$ -$ -$ -$ -$ -$ -$ -$

Local Capture Millage Rate

Unit Operating 0.89550 -$ -$ 332$ 336$ 343$ 350$ 358$ 365$ 373$ 381$

County Council on Aging 0.75000 -$ -$ 278$ 281$ 287$ 293$ 300$ 306$ 313$ 319$

County 911 1.00000 -$ -$ 371$ 375$ 383$ 391$ 400$ 408$ 417$ 426$

County Road 1.00000 -$ -$ 371$ 375$ 383$ 391$ 400$ 408$ 417$ 426$

County Transportation 0.33000 -$ -$ 122$ 124$ 126$ 129$ 132$ 135$ 138$ 141$

County Parks 0.25000 -$ -$ 93$ 94$ 96$ 98$ 100$ 102$ 104$ 106$

St. Joseph ISD Operating 0.22830 -$ -$ 85$ 86$ 87$ 89$ 91$ 93$ 95$ 97$

St. Joseph ISD Special Education 2.45540 -$ -$ 910$ 920$ 940$ 960$ 981$ 1,002$ 1,024$ 1,045$

St. Joseph ISD Special Evaluation 0.29460 -$ -$ 109$ 110$ 113$ 115$ 118$ 120$ 123$ 125$

St. Joseph ISD CTE 1.00000 -$ -$ 371$ 375$ 383$ 391$ 400$ 408$ 417$ 426$

Glen Oaks Community College 2.72490 -$ -$ 1,010$ 1,021$ 1,043$ 1,066$ 1,089$ 1,112$ 1,136$ 1,160$

County Operating 4.54820 -$ -$ 1,687$ 1,705$ 1,741$ 1,779$ 1,817$ 1,856$ 1,896$ 1,937$

School Sinking Fund 1.75000 -$ -$ 649$ 656$ 670$ 684$ 699$ 714$ 730$ 745$

Local Total 17.2269 -$ -$ 6,388$ 6,457$ 6,596$ 6,738$ 6,883$ 7,031$ 7,181$ 7,335$

Non-Capturable Millages Millage Rate

Local School Debt 7.00000 -$ -$ 2,596$ 2,624$ 2,680$ 2,738$ 2,797$ 2,857$ 2,918$ 2,980$

Total Non-Capturable Taxes 7.0000 -$ 2,596$ 2,624$ 2,680$ 2,738$ 2,797$ 2,857$ 2,918$ 2,980$

1Assumes 1% annual increase for inflation

Total Tax Increment Revenue (TIR) Available for Capture -$ -$ 15,287$ 6,457$ 6,596$ 6,738$ 6,883$ 7,031$ 7,181$ 7,335$

Z:\2020\200805\WORK\Rept\Brownfield\TB 1 TBL02 and TBL03_TIF_Burr Oak DRAFT.xlsx

Table 2 - Estimate of Total Incremental Taxes Available for Capture

Midwest V, LLC Redevelopment


2 of 2

Estimated Taxable Value (TV) Increase Rate:

Plan Year

Calendar Year

Base Taxable Value

Estimated New TV

Incremental Difference (New TV - Base TV)1

School Capture Millage Rate

State Education Tax (SET) 6.00000

School Operating Tax 18.00000

School Total 24.0000

Local Capture Millage Rate

Unit Operating 0.89550

County Council on Aging 0.75000

County 911 1.00000

County Road 1.00000

County Transportation 0.33000

County Parks 0.25000

St. Joseph ISD Operating 0.22830

St. Joseph ISD Special Education 2.45540

St. Joseph ISD Special Evaluation 0.29460

St. Joseph ISD CTE 1.00000

Glen Oaks Community College 2.72490

County Operating 4.54820

School Sinking Fund 1.75000

Local Total 17.2269

Non-Capturable Millages Millage Rate

Local School Debt 7.00000

Total Non-Capturable Taxes 7.0000

1Assumes 1% annual increase for inflation

Total Tax Increment Revenue (TIR) Available for Capture

10 11 12 13 14 15 16 TOTAL

2029 2030 2031 2032 2033 2034 2035

29,188$ 29,188$ 29,188$ 29,188$ 29,188$ 29,188$ 29,188$ -$

464,069$ 473,350$ 482,817$ 492,474$ 502,323$ 512,370$ 522,617$ -$

434,881$ 444,162$ 453,629$ 463,286$ 473,135$ 483,182$ 493,429$ -$

-$ -$ 2,722$ -$ -$ -$ -$ 4,947$

-$ -$ 8,165$ -$ -$ -$ -$ 14,840$

-$ -$ 10,887$ -$ -$ -$ -$ 19,787$

389$ 398$ 406$ 415$ 424$ 433$ 442$ 5,745$

326$ 333$ 340$ 347$ 355$ 362$ 370$ 4,812$

435$ 444$ 454$ 463$ 473$ 483$ 493$ 6,416$

435$ 444$ 454$ 463$ 473$ 483$ 493$ 6,416$

144$ 147$ 150$ 153$ 156$ 159$ 163$ 2,117$

109$ 111$ 113$ 116$ 118$ 121$ 123$ 1,604$

99$ 101$ 104$ 106$ 108$ 110$ 113$ 1,465$

1,068$ 1,091$ 1,114$ 1,138$ 1,162$ 1,186$ 1,212$ 15,753$

128$ 131$ 134$ 136$ 139$ 142$ 145$ 1,890$

435$ 444$ 454$ 463$ 473$ 483$ 493$ 6,416$

1,185$ 1,210$ 1,236$ 1,262$ 1,289$ 1,317$ 1,345$ 17,482$

1,978$ 2,020$ 2,063$ 2,107$ 2,152$ 2,198$ 2,244$ 29,180$

761$ 777$ 794$ 811$ 828$ 846$ 864$ 11,227$

7,492$ 7,652$ 7,815$ 7,981$ 8,151$ 8,324$ 8,500$ 110,522$

3,044$ 3,109$ 3,175$ 3,243$ 3,312$ 3,382$ 3,454$ 44,910$

3,044$ 3,109$ 3,175$ 3,243$ 3,312$ 3,382$ 3,454$ 44,910$

7,492$ 7,652$ 18,702$ 7,981$ 8,151$ 8,324$ 8,500$ 130,308$


Table 3 Tax Increment Revenue Reimbursement Allocation

Table 3 - Estimate of Total Incremental Taxes Available for Reimbursement

Midwest V, LLC Redevelopment Project


1 of 1

Developer

Maximum

Reimbursement

School &

Local Taxes Estimated Developer Capture 74,575$

State 7,450$ BRA Administrative Fee 11,500$

Local 67,125$ State Brownfield Redevelopment Fund 2,473$

TOTAL 74,575$ Local Brownfield Revolving Fund 39,347$

EGLE N/AMSF N/A

2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 TOTAL

Total State Incremental Revenue -$ 8,899$ -$ -$ -$ -$ -$ -$ -$ -$ -$ 10,887$ -$ -$ -$ -$ 19,787$

State Brownfield Redevelopment Fund (50% of SET) -$ 1,112$ -$ -$ -$ -$ -$ -$ -$ -$ -$ 1,361$ -$ -$ -$ -$ 2,473$

State TIR Available for Reimbursement -$ 7,787$ -$ -$ -$ -$ -$ -$ -$ -$ -$ 9,526$ -$ -$ -$ -$ 17,313$

Total Local Incremental Revenue -$ 6,388$ 6,457$ 6,596$ 6,738$ 6,883$ 7,031$ 7,181$ 7,335$ 7,492$ 7,652$ 7,815$ 7,981$ 8,151$ 8,324$ 8,500$ 110,522$

BRA Administrative Fee -$ 2,500$ 2,500$ 500$ 500$ 500$ 500$ 500$ 500$ 500$ 500$ 500$ 500$ 500$ 500$ 500$ 11,500$

Local TIR Available for Reimbursement -$ 3,888$ 3,957$ 6,096$ 6,238$ 6,383$ 6,531$ 6,681$ 6,835$ 6,992$ 7,152$ 7,315$ 7,481$ 7,651$ 7,824$ 8,000$ 95,134$

Total State & Local TIR Available -$ 11,675$ 3,957$ 6,096$ 6,238$ 6,383$ 6,531$ 6,681$ 6,835$ 6,992$ 7,152$ 16,841$ 7,481$ 7,651$ 7,824$ 8,000$ 100,511$

Developer Reimbursement Balance 74,575$ -$ 74,575$ 63,237$ 59,280$ 53,184$ 46,946$ 40,563$ 34,033$ 27,352$ 20,517$ 13,525$ 6,373$

Pre-Approved Environmental Costs 7,450$ -$ 7,450$

State Tax Reimbursement -$ 7,450$ 7,450$

Total EGLE Reimbursement Balance -$ -$ -$

Local Only Costs 67,125$ -$ 67,125$ 63,237$ 59,280$ 53,184$ 46,946$ 40,563$ 34,033$ 27,352$ 20,517$ 13,525$ 6,373$

Local Tax Reimbursement -$ 3,888$ 3,957$ 6,096$ 6,238$ 6,383$ 6,531$ 6,681$ 6,835$ 6,992$ 7,152$ 6,373$ 67,125$

Total Local Only Reimbursement Balance -$ 63,237$ 59,280$ 53,184$ 46,946$ 40,563$ 34,033$ 27,352$ 20,517$ 13,525$ 6,373$ 0$ -$

Total Annual Developer Reimbursement -$ 11,338$ 3,957$ 6,096$ 6,238$ 6,383$ 6,531$ 6,681$ 6,835$ 6,992$ 7,152$ 6,373$ 74,575$

LBRF Deposits *

State Tax Capture 7,450$ 7,450$ 7,450$

Local Tax Capture 31,897$ 942$ 7,481$ 7,651$ 7,824$ 8,000$ 31,897$

Total LBRF Capture 39,347$ 8,392$ 7,481$ 7,651$ 7,824$ 8,000$ 39,347$

* Up to five years of capture for LBRF Deposits after eligible activities are reimbursed. May be taken from EGLE & Local TIR only.

LOCAL BROWNFIELD REVOLVING FUND

15 total years (including LBRF capture)

Estimated

Years of Capture:

DEVELOPER Beginning

Balance


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Attachment B Environmental Data Tables and Map

Attachment C Resolutions Approving the Brownfield Plan

Amendment -Burr Oak Township

-St. Joseph County BRA

-St. Joseph County Board of Commissioners

Attachment D Reimbursement Agreement

BROWNFIELD REIMBURSEMENT AGREEMENT

THIS AGREEMENT, made this ___ day of _____, 2020 (the “Agreement”), between the ST.

JOSEPH COUNTY BROWNFIELD REDEVELOPMENT AUTHORITY, an authority established pursuant

to Act 381 of the Public Acts of 1996, as amended (“Act 381”), with offices at 125 West Main

Street, Centreville, Michigan 49032 (the “Authority”) and Midwest V, LLC, a Michigan limited

liability company, with offices at 1435 Fulton Street, Grand Haven, Michigan 49417 (the

“Developer”).

RECITALS

A. Pursuant to Act 381, the Developer has prepared a Brownfield Plan Amendment

which was duly approved by the County (the “Brownfield Plan Amendment”).

B. The Developer intends to develop property located at 32469 US-12 and adjoining

vacant land in Burr Oak Township, which property is legally described on the attached Exhibit A

(“Property”). The Property is included in the Brownfield Plan Amendment as a “facility” and

“eligible property” due to the presence of certain hazardous substances as described in the

Brownfield Plan Amendment and is therefore commonly referred to as a “brownfield.”

C. The Developer plans to redevelop the contaminated commercial land, demolishing

the existing structure, and constructing a new 9,100 square foot commercial retail store

(Improvements). The estimated investment in the Improvements is expected to be approximately

$1,200,000. The Improvements are expected to improve the aesthetic conditions of the property,

create temporary construction jobs, add new jobs, and increase the tax base within the County

and Township. The Developer acknowledges that the County and the Authority have relied on the

2

investment of the Improvements as consideration for the benefits extended under this

Agreement.

D. Act 381 permits the use of the real tax revenues generated from the increase in

value to brownfield sites constituting “eligible property” under Act 381 resulting from their

redevelopment to pay or reimburse the payment of costs of conducting activities that meet the

requirements under Act 381 of “eligible activities”(hereinafter “Eligible Costs”) and permits the

reimbursement to the Property owner or Developer of such Eligible Costs incurred by the Property

owner or Developer. Act 381 also permits the reimbursement of the costs to prepare the

Brownfield Plan Amendment for “eligible property” (“Brownfield Plan Costs”).

E. In order to make the Improvements on the Property, the Developer will incur

Eligible Costs associated with eligible activities—including Michigan Department of Environment,

Great Lakes and Energy (EGLE) and Michigan Strategic Fund (MSF) eligible activities, all of which

will require the services of various contractors, engineers, environmental consultants, and other

professionals (the “Eligible Costs”). The estimated Developer Eligible Costs shall not exceed the

sum of $74,575. The Eligible Costs for the project are set forth on the attached Exhibit B.

F. The Authority has incurred and will incur certain expenses in the preparation and

administration of the Brownfield Plan Amendment (the “Administrative Costs”), for which it seeks

reimbursement from Tax Increment Revenues (as defined below). The Administrative Costs are

estimated to be approximately $11,500.

G. In accordance with Act 381 and the Brownfield Plan Amendment, the parties desire

to use the property tax revenues that are generated from an increase in the taxable value of the

3

Property resulting from its development (“Tax Increment Revenues”) to reimburse the Developer

for Eligible Costs, and the Authority for its Administrative Costs.

H. The parties are entering into this Agreement to establish the procedure for the

reimbursement from Tax Increment Revenues under Act 381.

NOW, THEREFORE, the parties agree with each other as follows:

1. Definitions

“Baseline Environmental Assessment Activities” is defined by Section 2(b) of Act 381;

“Brownfield Redevelopment Financing Act” means Act No. 381 of the Public Acts of 1996,

MCLA 125.2651 et seq.;

“Brownfield Plan or Plans” is defined by Section 2(e) of Act 381;

“Due Care Activities” is defined by Section 2(m) of Act 381;

“Eligible Activities” is defined by Section 2(o) of Act 381;

“Eligible Property or Property” is defined by Section 2(p) Act 381;

“Eligible Party” is defined by Section 2(l) of Act 381;

“Response Activities” are defined by Section 2(oo) of Act 381;

“Tax Increment Revenues” is defined by Section 2(ss) of Act 381.

2. The Plan

(a) Developer’s Brownfield Plan Amendment, which the Authority approved on

______, and the County Commission approved on ______, is attached hereto as Exhibit C and

incorporated herein. To the extent provisions of the Brownfield Plan Amendment conflict with

this Agreement, the terms and conditions of this Agreement control. To the extent provisions of

the Brownfield Plan Amendment or this Agreement conflicts with the Act, the Act controls.

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(b) Unless the parties agree otherwise, the Developer shall complete the

Improvements by March 2021.

3. Term of Agreement

Per the Brownfield Plan Amendment, the Authority shall capture the Tax Increment

Revenues generated from local taxes imposed on the Property until the date on which Developer

receives full payment of the Eligible Costs under paragraph 8 (estimated at 2035) or 30 years after

approval of the Brownfield Plan Amendment, whichever is sooner. If this Agreement ends before

the payment of all Eligible Costs, the last tax payment by the Authority shall be the summer and

winter taxes distributed during the final year of this Agreement.

4. Eligible Activities

The Authority recognizes that before the date of this Agreement, Developer may have

initiated activities which may be submitted with a Request for Cost Reimbursement for Eligible

Activities. The Developer shall diligently pursue completion of the Eligible Activities set forth in

the Plan. The Developer will be reimbursed for Eligible Costs incurred before this Agreement only

if permitted under Act 381.

5. Reimbursement Source

During the term of this Agreement (unless limited by paragraph 2(b) and except as set forth

in Paragraph 7 below), the Developer shall be reimbursed for Eligible Costs from the Tax Increment

Revenues collected from local taxes imposed on the Property after the Authority’s Administrative

Costs have been deducted.

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6. Excess Captured Taxes

The Authority may use any Tax Increment Revenues captured from the Property in excess

of the amount authorized for reimbursement under Paragraph 5 hereof for reimbursement of any

additional Eligible Activities included in the Brownfield Plan Amendment.

7. Transfer of Ownership

Notwithstanding the transfer of the Property, the Authority and the County will pay

reimbursements solely to the Developer unless (a) the Developer pledges or assigns the right to

reimbursement to a transferee and the County receives notice by or on behalf of the Developer

directing payment to a transferee prior to payment or (b) as otherwise required by law. All

administrative and out-of-pocket costs (including attorneys’ fees) incurred by the County in

connection with the sale or transfer of the Property during the term of the Agreement shall be

reimbursed to the County with Tax Increment Revenues as a condition of approval.

8. Reimbursement Process

(a) Subject to any limitation set forth in paragraph 2(b), within 1 calendar year of the

completion of the redevelopment, the Developer shall submit to the Authority Requests for Cost

Reimbursement for Eligible Activities paid by the Developer. This request shall be in the form

attached hereto as Exhibit D (“Petition”). The Petition shall identify whether the activities are

Eligible Activities permitted under Section 2(o) of the Act. The Petition shall describe each

individual activity claimed as an Eligible Activity and the associated costs of each individual activity.

Documentation of the costs incurred shall be included with the Petition including proof of payment

and detailed invoices for the costs incurred sufficient to determine whether the costs incurred

were for Eligible Activities. The Petition shall be signed by a duly authorized representative of

6

Developer and the representations, facts, and documentation included therein shall be sworn to

as accurate in the presence of a notary. In the event the Eligible Activities and Costs for which the

Developer seeks reimbursement have been rendered by a related party or entity, the Authority

and the County may request documentation to substantiate the reasonableness of such costs prior

to reimbursement.

(b) Petitions shall be reviewed by the Authority within 60 days after receipt of the

Petition by the County. The Developer shall cooperate in the review by the Authority by providing

information and documentation to supplement the Petition as deemed reasonable and necessary

by the Authority. The Authority shall identify in writing to Developer any costs deemed ineligible

for reimbursement and the basis for the determination. Developer shall be given 45 days in which

to provide supplemental information or documents in support of a request for cost

reimbursement deemed ineligible by the Authority. Thereafter, except as otherwise agreed to in

writing by Developer and Authority, the Authority shall make a final decision on the eligibility of

the disputed cost and inform the Developer of its determination, which decision shall be binding

upon Developer.

(c) Twice a year, after the summer and winter taxes are captured and collected on the

Property, the Authority shall pay approved costs for Eligible Activities to the Developer from the

taxes captured in accordance with the Plan and Paragraph 5 of this Agreement to the extent that

taxes have been captured and are available in that fiscal year (less Authority’s operating out-of-

pocket expenses to review the Petition) to reimburse approved costs of Eligible Activities. No

reimbursement shall be paid to Developer if the Developer is delinquent in the payment of real or

personal property taxes on the property. Payments to the Developer shall be suspended if

7

Developer files a property tax appeal with the Michigan Tax Tribunal regarding the valuation of

the real or personal property assessment on the Property during the term of the tax appeal.

Payments shall resume after a decision is issued by the Michigan Tax Tribunal. The Developer and

shall not be reimbursed for any Eligible Costs and Activities incurred after any deadline set forth

in paragraph 2(b) is missed.

(d) If there are no funds available from taxes captured from the sources identified in

Paragraph 5 herein for Developer, then there is no repayment obligation to Developer.

(e) Reimbursement of Costs of Eligible Activities shall be effectuated to Developer

with:

Checks shall be payable to: Midwest V, LLC

Delivered to the following address: 1435 Fulton Street, 2nd Floor

Grand Haven, MI 49417

By mail

9. Legislative Authorization

This Agreement is governed by and subject to the restrictions set forth in the Act. In the

event that there is legislation enacted in the future which alters or affects the amount of Tax

Increment Revenues subject to capture, Eligible Properties, or Eligible Activities, then the

Developer’s rights and the Authority’s obligations under this Agreement may be modified

accordingly by agreement of the parties.

10. Freedom of Information Act

Developer stipulates that all Petitions and documentation submitted by Developer shall be

open to the public under the Freedom of Information Act, Act No. 442 of the Public Acts of 1976,

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being Sections 15.23 to 15.24 of the Michigan Compiled Laws and no claim of trade secrets or

other privilege or exception to the Freedom of Information Act will be claimed by Petitioners as it

relates to this Agreement, Petitions for Reimbursement and supporting documentation.

11. Plan Modification.

The Brownfield Plan Amendment and this Agreement may be modified to the extent

allowed under the Act by mutual agreement of the Parties affected by the modification.

12. Notices

All notices shall be given by registered or certified mail addressed to the parties at their

respective addresses as shown below their respective signatures to this Agreement. Either party

may change the address by written notice sent by registered or certified mail to the other party.

13. Assignment

The interest of any party under this Agreement shall not be assignable without the other

parties’ written consent, which shall not be unreasonably withheld. If the Developer seeks to

assign this Agreement for purposes of securing financing for the Project, the assignment of this

Agreement shall be subject to the terms and conditions reasonably required by the County and

the County shall be reimbursed with Tax Increment Revenues for its administrative and out-of-

pocket costs (including attorneys fees) incurred to process and approve such assignment.

14. Entire Agreement

This Agreement supersedes all agreements previously made between the parties relating

to the subject matter. There are no other understandings or agreements between them.

15. Non-waiver

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No delay or failure by either party to exercise any right under this Agreement, and no

partial or single exercise of that right, shall constitute a waiver of that or any other right, unless

otherwise expressly provided herein.

16. Headings

Headings in this Agreement are for convenience only and shall not be used to interpret or

construe its provisions.

17. Governing Law

This Agreement shall be construed in accordance with and governed by the laws of the

State of Michigan.

18. Counterparts

This Agreement may be executed in two or more counterparts, each of which shall be

deemed an original but all of which together shall constitute one and the same instrument.

19. Binding Effect

The provisions of this Agreement shall be binding upon and inure to the benefit of each of

the parties and their respective heirs, legal representatives, successors, and assigns.

In witness whereof, the parties have executed this Agreement as of the day and date first

written above.

{Signatures on next page}

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Witnesses: St. Joseph County

________________________ By: __________________________________

________________________ By: __________________________________

Date: __________________________, 2020

APPROVED AS TO FORM:

St. Joseph County

By:

125 West Main Street

Centreville, MI 49032

Date: ________________, 2020

11

ST. JOSEPH COUNTY BROWNFIELD REDEVELOPMENT

AUTHORITY

Witnesses:

_____________________________ By:

Title

_____________________________

Address: 125 West Main Street

Centreville, MI 49032

Witnesses: Midwest V, LLC

______________________________ By:

______________________________ Title: ________________________________

Address: 1435 Fulton Street, 2nd Floor

Grand Haven, MI 49417

A-1

Exhibit A

Property Legal Description

Property Address: 32469 US-12, Burr Oak, St. Joseph County, Michigan 49030

Parcel:

001-035-005-02

Legal Description:

COM CEN SEC 35 T7S R9W TH S 0D 41M W 303.75 FT TH N 89D 19M W 222.39 FT TH N 29D 17M

30S W 222.39 FT TO C/L US-12 TH N 60D 42M 30S E 99.02 FT ALG

C/L TH NELY ALG CRV R 285.50 FT TO N & S 1/4 LN TH S 0D 41M W 80.29 FT TO POB.

Acreage:

2.17 acres

Property Address: US-12, Burr Oak, St. Joseph County, Michigan 49030

Parcel:

001-035-005-03

Legal Description:

COM CEN SEC 35 T7S R9W TH S 303.75 FT TO POB TH S 55.96 FT TH N 89D 19M W 400 FT TH N

210.24 FT TO C/L US-12 TH N 60D 42 30 E ALG C/L 76.77 FT TH S

29D 17M 30S E 222.39 FT TH S 89D 19M E 222.39 FT TO POB. SUBJ TO HWY R/W.

Acreage:

1.11 acres

B-1

Exhibit B

Eligible Costs

Department of Environment, Great Lakes, and Energy (EGLE) Eligible Activities

Eligible Activity Estimated Cost

Pre-Approved Activities (Phase I ESA, Asbestos Survey, Baseline

Environmental Assessment (BEA), and Documentation of Due

Care Compliance) $7,450

Additional Due Care Activities (related to the water well) * $2,000

Asbestos Abatement* $2,000

Demolition* $50,000

Contingency (no more than 15%) * $8,625

Eligible Activities Sub-Total $70,075

Brownfield Plan Amendment Preparation $4,500

SJBRA Administrative Fees ($2,500 for the first 2 years then

$500 per year for the remainder of the Plan duration) $11,500

SJBRA LBRF $39,347

LOCAL ONLY ELIGIBLE ACTIVITIES TOTAL COST $125,422

*Eligible activities utilized for contingency calculation

St. Joseph County Brownfield Redevelopment Authority ...This Brownfield Plan Amendment (“Plan Amendment”) serves as an amendment to St. Joseph County ’s existing Brownfield Plan,

Documents