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Missouri Valley council votes to advance funding and remove successor clause to finish 500 East project
Summary
After extended debate, the council agreed to proceed with finishing the 500 East lease-assignment project, approving payment of a recent invoice and authorizing up to $153,817 in additional city funds (with a possible additional $50,000 contingency) and removing a successor clause in the personal-guarantee language so work can resume immediately.
The Missouri Valley City Council on Feb. 24 voted to proceed with completing the 500 East lease-assignment project and to make immediate payments so the contractor can return to the site.
Council members discussed a tight timeline tied to an external grant and agreed to pay the most recent invoice and to authorize a city contribution "not to exceed" $153,817 to close a funding gap. The council also directed staff and counsel to remove or reword a successor clause in the developer’s proposed personal guarantee so the developer would sign and work could begin. The motion passed on a roll call vote.
Council members described the financing as a layered package: the grant has about $64,318 remaining, there is an outstanding $29,731 balance tied to a prior $270,000 loan, and the council was told the immediate shortfall for work completion is roughly $103,817. Council members discussed a possible split of $103,817 with the Missouri Valley Development Board (the development group) contributing up to $50,000 and the city making up the remainder.
Developer Wayne, who addressed the council about progress and plans, told members he would prioritize finishing the work if funds were made available. "I promise you he's working as hard as he can to get that project done," Wayne said in reference to a crew foreman, adding that weekly invoicing and updates would help the council track progress.
Council members also discussed the risk that taxpayers’ money could be spent on interest and insurance rather than construction materials. One councilor said finishing construction would be the fastest path to getting revenue flowing back to the city and to preserve eligibility for a large grant tied to occupancy milestones.
The council asked for weekly status reports from the developer and staff and indicated they expected the contractor to be back on site within days if the personal guarantee language is adjusted and the payment is made. The council directed staff to document the agreement with language guaranteeing the city’s commitment "not to exceed" the approved amount and to prepare the paperwork for the personal guarantee and contract amendment.
Next steps: staff will work with counsel to remove or clarify the successor clause in the personal guarantee and process the invoice so construction can resume. Council members said they expect weekly updates until the project reaches the critical May 31 milestone.
