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RFD- 3746 Business Items   Item #   10. a.    
Regular Council Meeting Agenda
Meeting Date: 11/12/2019  
Title:    Sale of Land - Surplus Road Right-of-Way - Walker
Department: Economic & Business Development  
Strategic Vision Element: Where People Choose to Grow a Business - A strong, diversified regional business centre Related Goal: The City maintains a constant inventory of available land, both developed and developable, to ensure businesses can find properties that meet their needs.

Request for Decision Summary
Council is being asked to approve the sale of 4.32 acres of surplus road right of way along the north side of Highway 16A and west of Jennifer Heil Way to the quarter section line.  This is a remnant strip which is surplus to the City's requirements and a utility right-of-way easement extends the full length of the property to accommodate overhead power lines.  The subject area will be consolidated with the adjoining lands. 

Proposed Motion
That the sale of 4.32 acres of surplus road right-of-way land on the north side of Highway 16A and within the S.E. 1/4 of Section 5, Township 53, Range 27, West of the 4th Meridian and part of Road Plan 802 2789 to Wind Dancer Properties Ltd be approved for a total price of $505,000. 
The City has determined there is road right-of-way surplus to the City's long-term requirements along the north side of Highway 16A and west of Jennifer Heil Way to the quarter section line.  This is approximately 4.32 acres (1.75 ha) - approximately 22.8 m (75 feet) in width and 768 m (2,500 feet) long.  The City became the road authority for this portion of Highway 16A when Spruce Grove transitioned to city status.  The surplus land is essentially a remnant parcel with an overhead power line extending the full length to be protected by a utility right-of-way easement in favor of Fortis Alberta.  Council gave Third Reading to a Road Closure Bylaw for a portion of Road Plan 802 2789 on September 25, 2017.  

As the surplus parcel has no development potential without being consolidated with the lands to the north, the City approached Wind Dancer Properties Ltd. - as owners of the adjacent lands - about acquiring the subject area.  Wind Dancer has subsequently come forward with a subdivision application which includes consolidation of the surplus ROW with the adjacent quarter section and the subdivision of 20 acres south of Legacy Park to create a new commercial parcel.  Third Reading for redistricting Legacy Park Stage 4 is scheduled for November 12, 2019 with subdivision approval and endorsement including consolidation of the surplus ROW following thereafter.  A Development Agreement will be a condition of subdivision approval.  

For purposes of setting a price, the City commissioned Altus Group to undertake an appraisal of the subject ROW parcel.  The appraised value was determined to be $505,000 or approximately $117,000 per acre. Wind Dancer has agreed to the price and an Agreement for the sale has been prepared.  The Agreement also provides for the dedication of an easement for construction of the eventual Boundary sanitary sewer trunk line.  As a condition of the dedication, the City agrees not to start construction of the line for at least two years.  A map showing the sale lands and sanitary line easement is attached.  

The closing date for the transaction is 30 days from endorsement of the Plan of Subdivision which would likely place the date in March 2020.  
Retain the subject parcel.  However, it would continue as a net cost to the City and has little value without consolidation with the adjoining lands.  Once the 20-acre subdivision application has been approved for commercial development, the opportunity to sell the subject parcel is likely lost.    
The City retained Altus Group Inc. to provide a valuation of the subject land and provide a recommended sale price.  Negotiations have been ongoing with Wind Dancer Properties Ltd. for the sale of the parcel, consolidation with the adjacent lands, dedication of the Boundary sanitary sewer line easement and a subdivision application for a 20-acre commercial parcel.  
An agreement has been prepared for the sale of the remnant parcel and dedication of the Boundary sanitary sewer line easement. The closing of the sale will not happen until subdivision endorsement and registration has occurred.  

This Agreement allows the City to sell a remnant parcel that will be consolidated with the future adjacent commercial lands.  The City will no longer have to maintain the subject parcel and is not required to fund any future initiative to bury the power line.  At the same time, the City will benefit from a higher assessed value for the land.  As well, the dedication of the Boundary sewer line easement will facilitate future planning for development of lands south of Highway 16A.
Map Showing Highway 16A Surplus ROW Land Sale

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