Discussion reveals conflicts in Butler Farms agreement



A special called meeting prior to the Council’s regular meeting to discuss the Butler Farms development warranted a lengthy exchange between the Council, staff and developers of the subdivision.

The Butler Farms development agreement was signed in 2018, but Wyatt Henderson of MA Partners, the developer on the project, said it was just noticed in the last 60 days that the Tax Increment Reinvestment Zone (TIRZ) created for the subdivision is in direct conflict with what the development agreement says.

“When the TIRZ was formed, at that time the city tax was 50 cents and we got 25 cents, or 50 percent,” he said. “But instead of it being 50 percent it was somehow changed to 30 percent, which we believe is an error that needs to be fixed because the development agreement says 50 percent. The TIRZ has to be amended for us to move forward.”

Henderson asked Council to direct staff and the city attorney to amend the TIRZ ordinance to reflect 50 percent instead of 30 percent. He added that in addition to this amendment, Butler Farms would also waive its ability to ever de-annex from the City and would reinstitute a $1,000 public improvement district (PID) fee to be paid to the City that expired 18 months after the development agreement was signed.

City Attorney Dottie Palumbo said ultimately, it’s better for the City to stick with the 30 percent monetarily, but that the Council should use discretion to stick with whatever ordinance is in the best interest of the City.

“We need to look out for the City’s money,” said Council member Chris Pezold. “If there is an item such as this that is in contest and it’s not clear, then we’ve got to look out for the City. If it was something that was cut and dry I’d say we need to honor it, but it’s not clearly defined in the development agreement, and my attorneys and my team are saying there is an argument against this.”

Henderson said his attorney would say the exact opposite, because he’s not asking for anything that the development agreement doesn’t already state.

“I sold lots to builders based on receiving that value,” he said. “I’m not taking any money out of the City’s pocket.”

Henderson’s attorney, Kevin Pierce of Metcalfe Wolff Stuart & Williams, said the question is not necessarily what the most powerful document says, but it is “what was the original intent of the parties at that time?”

“If you balance all the evidence, most of it says 50 percent and one document says 30 percent, so the strong argument is that it’s not representative of the intent,” he said.

Pezold stated again that if it was truly a clerical error, he would have no issue with it, but he is not convinced.

“If you can bring something and show me this was truly a mistake, I’m on board with honoring [the 50 percent],” he said.

Henderson said he will work on getting a sworn statement from former City Administrator Greg Boatright, who worked on the agreement, and would also see what other information he could gather.