PURPOSE

The purpose of this budget amendment is to add funds for legal services related to the preparation of a Development Agreement for the Downtown Economic Development Initiative.

BACKGROUND

On October 24, 2005, the Town Council authorized the Manager to sign a Memorandum of Understanding with Ram Development Company for the development of mixed use projects on Town-owned property in downtown Chapel Hill, and to negotiate a Development Agreement. At that time, we reported that we would be proposing a budget amendment to add funds for continuing legal services for the project.

DISCUSSION

On June 15, 2005, the Council authorized negotiating with the Ram Development Company, and on June 27, 2005, the Council authorized execution of an Exclusive Right to Negotiate with the selected developer. During that time, the Town entered into a contract for legal services with an attorney who is experienced in negotiating public-private development agreements, Glen Hardymon of Kennedy Covington Lobdell and Hickman, L.L.P. Funds for legal assistance ($60,000) were included in the Town Budget adopted on June 27, 2005. These funds have been spent in negotiating the Memorandum of Understanding authorized by the Council on October 24, 2005.

As we proceed to the next phase of negotiating a full Development Agreement, we estimate that an additional $30,000 is needed for legal services related to drafting and negotiating this Agreement. We would finance the additional work from fund balance in the General Fund.

RECOMMENDATION

We recommend the Council adopt the attached Ordinance amending the Budget to add $30,000 for legal services for the Downtown Economic Development Initiative.

AN ORDINANCE TO AMEND “THE ORDINANCE CONCERNING APPROPRIATIONS AND THE RAISING OF REVENUE FOR THE FISCAL YEAR BEGINNING JULY 1, 2005” (2005-11-09/O-1)

BE IT ORDAINED by the Council of the Town of Chapel Hill that the Budget Ordinance entitled “An Ordinance Concerning Appropriations and the Raising of Revenue for the Fiscal Year Beginning July 1, 2005” as duly adopted on June 27, 2005 and the same is hereby amended as follows:

This the 9th day of November, 2005.