City offers extensions for development deal
Progress on a major new retail and commercial development is a lot slower than New Richmond officials had hoped.
So on Monday night the City Council turned up the heat on CCS, LLC, a local developer with plans for a complex of buildings along Richmond Way north of Wal-Mart.
When the City chose Scott Counter's organization to develop the 18.8 acres of prime real estate a year and a half ago, the hope was that things would move quickly.
Alderman Jim Zajkowski said Counter had worked to create design standards for the future development and knew what the City was looking for. They chose him over two other prospective developers who indicated it would be a year or more to get things started.
At the time, Counter had indicated that he hoped to start constructing buildings in the spring of 2008.
"Initially, we thought he could get it off the ground fairly quickly," Zajkowski said.
But according to CCS's attorney, Thomas Schumacher, several troubling issues have stalled progress on the project.
Problems with the certified survey map and storm water management have forced CCS officials to take advantage of two three-month extensions on the city-established deadline to buy the commercial land.
To extend the purchase agreement deadline, CCS has paid $20,000 on two occasions to retain their rights for buying the land. The $40,000 is non-refundable if the potential developer backs out of the deal.
The current extension expires on Oct. 27, according to Schumacher, and the business is still unsure if it will be able to resolve the issues that have so far stopped the plans.
Under the present agreement with the City, Schumacher said, CCS no longer has extensions available to them. He requested that the City provide two more potential extension periods so that details can be worked out.
But Zajkowski said he was reluctant to keep the land tied up without significant assurances that CCS will be able to get the deal accomplished.
"Now, the way it looks, nothing will happen until next year," he said. "That's two years with no results."
If the City grants two additional extensions and the project falls apart, Zajkowski said the land would have sat empty for three years.
That's frustrating, he said, because the 18.8 acre plot is viewed as a key to future development along Richmond Way, Zajkowski said. Once buildings appear on that particular property, lots to the west will more likely begin to be developed.
Eventually Zajkowski said he would support additional extensions if the price tag on each extension was raised to $40,000 of non-refundable payments.
If CCS eventually follows through and buys the property, Zajkowski explained, the entire $140,000 in extension payments would be applied to the purchase price.
If the project fails to materialize, Zajkowski said, the City would at least retain a significant chunk of change.
"I think we could probably live with that," Schumacher said.
The Council voted 5-0 to offer two more three-month extensions to CCS at a cost of $40,000 per extension.