Community Reinvestment Agency - Regular Meeting

That takes us to item 6 which is a need to recess to the community reinvestment agency meeting is their motion so moved All right motion by Brynn Okay, is there further discussion Brynn how do you vote? Yes, Tasha? Catherine?

Yes.

Fred? Yes. Right. We are now convened. I'll call to order the Community Reinvestment Agency meeting. First item on our agenda is item 2. Item 2A is the approval of the August 18th, 2026 Community Reinvestment Agency meeting minutes. And item 2B is... An action item is approval of Resolution CRA-2605. It's a resolution approving a participation agreement with Next Core Health Development LLC for the development of a medical office building in the Crescent Redevelopment District. I'm assuming we have some presentations for that. Go ahead, Mike.

Yeah, just really quick. So we're here asking for the City Council to approve a participation agreement with Nexcor Healthcare Development LLC. Ryan DeGear with Nexcor is present, as is Mr. Dobbins, who has acted as their consultant and helped... negotiate this participation agreement. So Nexcor Health really quickly is a national healthcare real estate company that partners with local healthcare systems and they build new developments in communities that align with the local healthcare system. They may be surgical centers, they may be imaging centers, office buildings, medical office buildings. They end up being the owner, developer, and manager of their projects and contribute their own capital to projects, meaning that they don't come in and just get an agreement done or get the entitlements done, but they are in it for the long haul. And so we've started establishing a good relationship with Next Corps and their representatives. So the project they're proposing would be a three-story, 80,000-square-foot medical office building adjacent to Lone Peak Hospital. They project that they'll employ approximately 150 medical professionals, and in that medical office building, provide specialized healthcare, including cancer treatment and orthopedic care. The benefits, excuse me. Actually, there's a typo there. It should be $3.3 million, but the Crescent Redevelopment District as part of the participation, would contribute $3.3 million towards the project, with the benefits to the city being spurring economic development in that area, providing high-quality health care options and creating high-wage medical jobs. Our financial consultants, LRB, did an analysis of the CRA's contribution to the project and the benefits that the city can anticipate receiving. And the benefits flowing back towards the city are many multiples, if you will, of the $3.3 million in investment or incentive. And that includes increased property tax, sales tax, tax on personal property, as well as the creation of the highway. high-paying jobs. And so there definitely is a good return on investment, as we found, quite frankly, in other CRA projects. Currently, the CRA, the Crescent Redevelopment District, has approximately $7.3 million available for qualifying projects. There are three different benchmarks that NextCorps has to meet in order to be eligible to receive payment. The first is $1.3 million payable upon the closing of the construction loan. I go back to the slide earlier that mentions it, that Next Core owns, operates, and is involved in the office building on a long-term basis. And I specifically asked about this particular provision. Upon closing the construction loan, there are obligations that they have both to their prospective tenants as well as their equity partners. And so they just can't walk away from this deal with $1.3 million. I feel comfortable with that provision. The next payment would be in the next fiscal year, which would be payable upon the issuance of a building permit. and a proof of $3 million in development expenditures. They provided information to me so far, and I think they're in more than $2 million so far on this project. So they're well invested to this point, even before we've got this participation agreement in place. And then the last payment of $700,000 would be payable upon the issuance There's three portions of this. The certificate of occupancy for the structure core and building shell. The first tenant receiving a certificate of occupancy and then proof of creation of 30 medical professional full-time employment or FTE equivalents earning at least $96,000 a year. So based on the analysis of LRB and these benchmarks, which I think Nexcor can achieve in the next two or three years. I think this will be a project that will benefit not only the Crescent District, but as well as the city by really bringing more services, specialized medical services to our residents without having to go all over the valley and other places. So I think there's a lot of upside to this project. So if you have any questions or if you have any questions for NEXT Core, I'm happy to entertain those.

I just have a question. If there's any infrastructure that might need to be improved or replaced because of this development, will that, this $3.3 million, will any of that go towards that?

I don't think, well, they may have infrastructure improvements on site. Ryan, I invite you up if you want to answer that question. Off-site, probably not, but I'll let him.

Hey, everyone. Thank you for having me. Yeah, off-site, there won't be any...

Step up to that mic if you would. Lift it up. Thank you. Give us your name and address.

Randy Deer from Nexcor Group, Assistant Vice President of Real Estate Development. There will be no improvements for off-site. On-site, we will have some limited improvements for not only landscaping, but as well as the drive lanes that connect to the existing campus.

I guess to follow up with that, is there any anticipated improvements that we might need to make to either Minuteman or the road with 125th?

We've talked about the possibility of using some of the CRA funds to... participate with UTA and UDOT in straightening out Kimball's Lane. We've talked with Jason Burningham about that and are looking at an analysis of whether or not that off-site improvement would be eligible for CRA participation. I don't know that there's any anticipated improvements along Minuteman, as you're aware. UDOT has a pretty significant project at this point, so I don't know that that road will be upgraded or any changes made until UDOT establishes their final plan for that freeway expansion.

Another question I just have. How many other projects are...

Potentially available within this district we don't have any that are proposed right now, but

Like how close is it to being billed out or whatever?

It's getting close on that property. There may be other investments we can make in upgrading maybe some of the existing infrastructure and facilities. That's something that I sent an email to the council that we were meeting with LRB to come up with a capital facility, a project plan that we can present to you that we'll outline some of the possibilities.

Because this would be about three-something million out of that seven million that's left for that district, right?

And there's still quite a bit of life left in that particular district, unlike we've got a couple that have come to the end of their life, and so we do have money that we need to spend on projects. This one we have a little bit more lead time. Okay.

Any other questions? Thank you, sir.

Appreciate it. Thank you.

All right. This is an item for action. Is there a motion? Mr. Mayor, I make a motion that we approve the August 18, 2026 Community Reinvestment Agency meeting minutes and also approve this action item, Resolution CRA 26-05.

Motion by Fred to approve. Is there a second?

I'll second.

Second by Brynn. Very good. All right. Any further discussion? Hearing none, Fred, how do you vote? Yes. Brynn?

Yes.

Tasha? Yes. Catherine?

Yes.

Items passed unanimously, four to zero. That requires item number three, which is a motion to adjourn ourselves back into our exciting city council meeting.

So moved.

Motion by Brynn. Second? Second. Second by Tasha. Brynn, how do you vote?

Yes. Tasha? Yes.

Catherine?

Yes. Fred? Yes.

All right. Unanimously, we are reconvened, and that puts us right at item number...