Bettendorf sports complex building permits $8 million less than specified in development agreement

Building permits issued for the Bettendorf sports complex at Middle and Forest Grove Road total $38 million, some $8 million less than the $45 million value specified in the agreement with BettPlex developer Douglas Kratz.

Meanwhile, the cost of city infrastructure – sewer lines, stormwater facilities and street improvements to serve the 79-acre complex – is expected to be well above the $3.87 million specified in the same development agreement.

The sports complex builder, Build To Suit of Bettendorf, obtained the building permit August 28. The permits listed the building cost of $28.6 million, electrical work $4.11 million, heating/air conditioning $1.85 million and plumbing costs of $950,000, for a total value of $35.5 million. Two months ago, the developer obtained a permit for the sports complex foundation for more than $2 million.

Another provision in the agreement does obligate the developer to setting a minimum assessed value on the property to generate new incremental taxes sufficient to pay the principle and interest on $4.9 million in Tax Increment Financing bonds issued by the city.

A lower value of the property today, though, will translate into a lower value for the property when the Tax Increment Financing (TIF) deal expires in 20 years. That's when all taxing bodies (Pleasant Valley Schools, the county and the city) would begin receiving the full amount of property tax from the development.

Sewer and stormwater work for the sports complex came in well above $3.87 million in July, and nearly $300,000 of those contracts was shifted to "regional infrastructure" to avoid being counted toward sports complex improvement expenses.

Yet to be awarded is a contract for upgrading the Forest Grove and Middle Road intersection, one of the most expensive city commitments listed in the development agreement. The initial estimate for the roadway improvements was $1.15 million.

The city council approved shifting $288,000 of the sewer contract work to "regional infrastructure" after city officials said that portion of the contract was needed to serve land development west of the sports complex. Under normal developments, the cost of extending sewer lines is borne entirely by the developer.

According to the contract, signed by the city and developer, "the city's contribution toward the infrastructure improvements shall not exceed $3.87 million overall. . ."

Listed as improvements covered by that cap was $500,000 for four entry roads to the sports complex, $310,000 for asphalt access walks, $1.15 million for Middle Road and Forest Grove Drive improvements, $700,000 for off-site sewer main and manholes, $210,000 for on-site sanitary sewer mains and laterals, and $1 million for on-site storm water improvements.

The agreement states if the specified improvements "result in total expenses greater than or less than the estimated amounts, such estimates and work to be performed may be adjusted within the overall cap of $3.87 million."

Also under the development agreement, the city has provided Kratz with $1.9 million cash upfront, plus the $4.9-million to be repaid through incremental taxes on the property over the next 20 years. The city also agreed to and has purchased 10 acres of land from the developer for $600,000.

CLICK HERE to download a copy of the development agreement between the city and the sports complex owner.