Approximately 350 new homes could be built in Aberdeen if the city and the developer can reach an agreement over possible construction of a water tower for the area, but the details are not so simple.
Developer Ed Gold told the city council at a July work session that he would be willing to fund a water tower he anticipated his potential $25 million project at the Presbyterian Home site near Long Drive would need.
The city and Gold are still working out the potential agreement as of Friday, Mayor Patrick McGrady said.
The point of financing the approximately $4 million water tower — interest free — is to guarantee the municipal water and sewer systems have enough capacity for construction of the homes. If the systems do not have sufficient capacity for them, they cannot legally be built. Gold worried that insufficient water capacity could hinder the building process if a water tower is not constructed.
“I do not want to build a water tower, but I am willing to finance a water tower," Gold said.
The agreement Gold is seeking with the city would lock in the water and sewer connection fees at the time of the agreement. Currently, those fees total $15,900 per equivalent dwelling unit — a measure of the average amount of capacity a home in the area uses.
Gold told the council that he had the money to finance the water tower, citing a wealthy investor at a publicly traded company who was willing to fund the project, even through the coronavirus pandemic.
“They guarantee that if something happens to Ed Gold, they’ll step into my shoes,” he said. “They share my view that the water tower is essential to put the other $25 million up.”
At the meeting, McGrady suggested that the city could find other ways to guarantee that Gold’s development would have water and sewer capacity so homes could be built.
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Eventually, the west side of the city will need a water tower for further development, he reasoned, so the city could wait to construct it without signing a legal document.
“Would it make you comfortable if we codify it as a city, when we see two years from now we need a tank, we build the tank?” McGrady asked. “We would love for your project to be successful here.”
To ensure the tower is built, Gold and his attorney Joseph Snee Jr. proposed a formal contract known as a DARA, or “Developmental Rights and Responsibilities Agreement,” that would lay out each party’s obligations, including committing the city to the tower’s construction and supplying water for Gold’s development.
Gold would also earn back his money in deferred water and sewer hookup charges from his development and another potential development at the Seibert-Adams property. The council annexed the 75 or so acres into city limits in August of 2019.
The city attorney worked over the draft of the agreement and returned it with changes that Gold couldn’t accept, he said at the meeting.
“They did not have any of my guarantees; they made me finish the water tower even if the project did not go forward,” Gold said. “It was not what I said I needed to go forward.”
The city attorney and Snee have decided to work on the document more in private before bringing up the issue again.