August 2008 Overall project summary update

On-site Cultural Resource Studies

May 31 Study Session Presentation

Review Letter from Applied Economics

Summary Letter from Applied Economics

Relocation of ball fields

Agreement to Purchase Real Property and Escrow Instructions

Development Agreement

Background

Documents:

• Notice of Intent
• Map of proposed location
• Discussion outline of project that will be finalized in a Development Agreement for Council
• Proposal presented to Council on Dec. 18, 2006

Waveyard is an adventure “super” park, which will be located at the southeast corner of the loops 101 & 202 interchange. Waveyard will be home to a 400 room, 4 star resort hotel, outdoor whitewater, scuba and surfing park, resort villas, a conference center, a spa and wellness center, an amphitheater, restaurants, entertainment retail, office space, and residential opportunities.

Answers to Frequently Asked Questions

• Mesa voters approved the Waveyard project and financial incentive at the Nov. 6, 2007 election.
   
• Waveyard paid for the City’s election costs (estimated at $250,000).
   
• When financial assurance requirements are met by Waveyard, the City will sell approximately 121 acres to Waveyard for development of project.
   
• The purchase price is $30 million.
   
• Waveyard will pay at least $10 million at close of escrow.  Waveyard has the option to secure the remaining $20 million with a $20 million promissory note at a 4.4% interest rate.
   
• Required Minimum Improvements:  Waveyard will only be entitled to incentives if the following Minimum Improvements are constructed and opened:

1. Surfing Wavepool
2. Whitewater, Paddle Sports and Training Facility
3. Scuba, Dive and Snorkeling Lagoon(s)
4. Resort Hotel-A minimum 400-room, AAA 4 Diamond and Mobile 4 Star resort.
5. Retail- A minimum of 200,000 sq. ft. of retail shops, exclusive of grocery, warehouse and similar stores.

• Protections for the City of Mesa (Prior to selling of land):

1. Waveyard must receive Site Plan approval for all Minimum Improvements
2. Waveyard must pay all Permit fees for the Waveyard & Resort
3. Provide evidence to City Manager that Waveyard has financial capacity to complete project

• Protections for the City of Mesa (After Title Transfers):

1. Unless Minimum Improvements are completed and open by date specific, Waveyard will not be entitled to economic incentives
2. Promissory Note for $20 million plus 4.4% interest
3. The City of Mesa is in the first position on the Promissory Note
4. Property reverter in place until construction of Waveyard begins

• If Waveyard completes and opens with Minimum Improvements, Mesa will rebate/credit Waveyard the following:

1. Sales Tax:  Of the 1.75% sales tax, the City will retain 1% and Waveyard will receive .75%
2. Bed Tax:  Of the 3% Bed Tax created by project, Waveyard will receive 1.5%
3. Public Improvements:  Mesa agrees to provide up to a maximum of $1.5 million for needed street improvements to Dobson and 8^th Street.

• Quality of Life and Street Tax Revenues are not part of incentives.
   
• State law required 3^rd Party economic analysis of project found that Waveyard will generate more revenue to the City than the tax incentive.
   
• 3^rd Party analysis estimates the following revenues will be created by Waveyard to the City:
  • General Fund:  $20,871,934
  • Quality Of Life & Street:  $21,028,471
  • Bed Tax: $8,311,050
     
• The City of Mesa is committed to relocating Riverview softball fields within west Mesa.
   
• The source of reclaimed water for Waveyard waterpark is a City well that is not hooked up to the City’s drinking water system).  Waveyard will operate and maintain the well and will install a treatment process specifically for the treatment of the water from this well so that it is suitable for use at the facility.
   
• Waveyard’s outdoor water use is expected to be less than that of an 18-hole golf course, and only slightly higher than the water use of the golf course and park that currently occupy the site.
   
• The land where Waveyard is located is entitled to extensive water rights from the Salt River Project system.  Mesa anticipates that it will have enough water to meet Waveyard’s needs, even in drought conditions.  Mesa does not expect that water use at Waveyard would ever impact or limit the water use of other customers. 
   
• As part of the City’s long-standing water conservation programs, Mesa continues to ask customers to use water wisely.