DEVELOPMENT AGREEMENT AMENDMENT MODIFYING THE CITY PAVING INCENTIVE FROM CEDAR LANE TO AURORA AVENUE
At the May 12, 2026, City Council meeting the Council reviewed a request from the Burgasons related to incentives for the Ansley development (Attachment A). At that meeting, the City Council directed staff to prepare an agreement for the City's paving of approximately 650 feet of Aurora Avenue in lieu of paving Cedar Lane. The request came in response to a request by the developers (Attachment A).
The Council had previously approved an agreement with the Ansley developers for paving of 1/2 of 700 feet of Cedar Lane (Attachment B), which would be altered with this proposal. The original zoning agreement for the development of Ansley is also attached (Attachment C).
The Ansley development is located in south Ames, east of Cedar Lane. Two subdivision additions in the northwest of the site have been platted with accompanying infrastructure installed. Cedar Lane is required to be paved before development at the southerly end of the site can occur. Additionally, the paving of Aurora Avenue within the development is needed for additional development to occur to the northeast and center of the site.
The developer has indicated that paving the Aurora in lieu of Cedar Lane would facilitate near term development in FY 2027/28 with townhomes and detached housing lots within the project. If the new request is approved, the developer would commit to extending two other street segments in conjunction with the City extension of Aurora Avenue to plat additional lots for development. The Aurora paving by the City would be contingent on the developer platting these additional areas for development.
The developer believes this request for supporting near term development is in line with other development incentive requests reviewed by City Council in December 2025 focused on near term development incentives.
The Public Works Department estimates that 650 feet of Aurora paving, sidewalks, and storm sewer would total approximately $371,000 in cost to the City. This approximates the value of the incentive provided to the nearby Domani I developer, but is estimated to be higher than the assumed future cost of paving Cedar Lane.
The new development agreement (Attachment D) states that:
- The City will no longer have any obligation for constructing Cedar Lane
- Paving of Aurora Avenue shall be part of the first final plat that includes the extension of Aurora Avenue
- The developer will be responsible for the short extension of Aurora Avenue in conjunction with Swan Lane (approximately 52 feet from the current end of Aurora Avenue at the edge of Ansley)
- The City shall determine the appropriate timing of its paving responsibility. The parties agree that the City's paving work is projected to occur after July 1, 2027, in FY 2027/28. It is anticipated that the City will add this project as part of the capital improvement plan in the FY 2027/28 budget process.
- The City's financial responsibility shall be limited to paving costs only, including curb, gutter, pavement section, storm sewer, and intersection sidewalk ramps. No water, sanitary sewer, sidewalks, or other improvements shall be included as part of the City's covered paving costs.
- The sidewalks will be the responsibility of the developer.
- The developer shall provide the City with approved, completed improvements plans.
- The developer shall complete the extension of Aurora from the end of the City paving to connect to the west to Ansley Avenue.
FUNDING:
It would be the goal of the City to follow through with the extension of Aurora Avenue in FY 2027/28 as originally planned. Staff believes General Obligation Bonds would be the funding source for this improvement.
- Approve the development agreement amendment related to paving of Aurora Avenue in lieu of Cedar Lane, as early as FY 2027/28.
- Direct staff to modify the proposed development agreement amendment.
- Take no action to approve the amendment.
The proposed agreement is consistent with City Council's direction from May. The obligations are clearly defined within the agreement. The City's timing of completing the work is discretionary and contingent upon the developer completing final subdivision plats and partially construction the Aurora Extension. Therefore, it is the recommendation of the City Manager that the City Council approve Alternative No. 1.