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Board affirms letters of intent are nonbinding; staff told to state that clearly to developers
Summary
Economic development staff asked for direction about how to handle developer letters of intent (LOIs) for district land. The board agreed LOIs are nonbinding and staff should inform applicants that nothing is final until a signed contract is approved by the board; staff will add standard language to LOI responses.
Matt Lund, director of business administration, told the board that developers increasingly want assurance that a parcel will be held while they spend on due diligence. He outlined the district’s present practice: inquiries and LOIs are presented to the board, but nothing is final until a contract is signed and approved.
Board members and legal counsel urged clear, consistent communication to developers. Legal counsel Carl recommended staff include an explicit statement in LOI correspondence: the LOI is nonbinding and does not limit the district from entering a contract with another party. “Any correspondence that we have with anybody who submits an LOI should include a sentence that says, thank you very much for your letter of intent. Please understand that it is not a binding document in any way and does not limit the district's ability to enter into a contract with anyone else,” Carl said.
Board members debated whether to offer any limited exclusivity at a later stage. Some suggested that, if the board chooses to, it could grant a short first‑refusal window only after the board acknowledges an LOI in a public action. The board did not adopt a new policy to award exclusivity automatically; rather, it directed staff to make the district’s standard practice explicit to prospective buyers and to continue bringing land transactions to the board for approval.
Ending: Staff will standardize LOI responses to state clearly that LOIs are nonbinding and that only an executed contract approved by the board secures a property transaction. The board said it will retain discretion to offer limited exclusivity on a case‑by‑case basis but will not change the default practice.
