ARLINGTON COUNTY, VIRGINIA. County Board Agenda Item Meeting of November 18, 2017

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1 ARLINGTON COUNTY, VIRGINIA County Board Agenda Item Meeting of November 18, 2017 DATE: November 9, 2017 SUBJECT: Allocation of $200,000 from the Rosslyn Fund to be transferred in the form of an economic development incentive ( EDI ) grant to the Industrial Development Authority of Arlington County, Virginia (the Authority ) and then to Central Place Office, L.L.C. ( CPO ) (an entity created by JBG Smith), subject to the terms and conditions of the agreement among Arlington County, the Authority and CPO. C. M. RECOMMENDATIONS: 1. Authorize the County Manager to sign on behalf of the Arlington County Board the attached agreement among Arlington County, the Authority and CPO, which outlines the terms of the grant. 2. Allocate $200,000 from the Rosslyn Fund ( ) for payment to the Authority. ISSUES: As of the date of this report, there were no unresolved issues. SUMMARY: Previous County Board action allowed JBG Companies (now JBG Smith) to construct an on-site public art element as part of the development at Central Place. The County and JBG, together with the selected artist, determined that funding beyond what JBG was obligated to invest in the public art would be necessary to realize the vision for Central Place plaza and the larger concept of the Rosslyn Corridor of Light. The parties therefore agreed that in order to augment the project, the County would contribute $200,000, allocated from the Rosslyn Fund, and JBG would fund an additional $300,000. BACKGROUND: In May 2015, the County Board approved a site plan amendment allowing JBG to fulfill the public art condition of Central Place by directly commissioning an on-site public art project ( Project ). Since that time, JBG has worked with AED to develop a proposal that will complement the County's Corridor of Light project, a significant place-making initiative for Rosslyn, as addressed in the recently adopted sector plan. County Manager: ##### County Attorney: ***** 24. Staff: Angela Adams, AED, Public Art Director

2 The current cost of the Project is estimated to be $1,288,028. This amount is $500,000 more than the approved Central Place site plan obligates CPO to spend towards public art on the site, which is $750,000 plus CPI-U escalation since the site plan was originally approved in JBG is willing to invest an additional $300,000 in the project if the County will invest $200,000. This agreement enables the County to accomplish a key urban design goal for Rosslyn and to obtain more than five times the value of the County s contribution. The County s $200,000 contribution for this agreement will be allocated from the Rosslyn Fund, a Trust and Agency (T&A) account that has been set aside from previous developer community benefits contributions and is to be used for public improvements in Rosslyn. The vision of the Central Place plaza as gathering place for all of Rosslyn makes this public investment in enhanced public art in the plaza an eligible use of this fund balance. The Rosslyn Fund has a current balance of $346,522 and has not been used since FY DISCUSSION: The attached agreement details the specific terms of the EDI grant. The general disbursement installment schedule and conditions are as follows: 1. $100,000 payable upon the County s transfer of the funds to the Authority; and 2. $100,000 payable after the County s satisfactory acceptance of the completed project, as determined by the County Manager or his designee. If CPO receives the first $100,000 installment of the EDI Grant but then does not complete the Project to the County s satisfaction, then CPO will be required to repay the $100,000. PUBLIC ENGAGEMENT: This grant has been endorsed by the Rosslyn BID and the Public Art Committee (PAC) of the Arts Commission. (See attached letter from the RBID and PAC meeting notes.) FISCAL IMPACT: The Rosslyn Fund has a current balance of $346,522, of which $200,000 would be allocated for the project as described, leaving a remaining balance of $146,522. There is no net tax support impact

3 ARLINGTON ECONOMIC DEVELOPMENT Cultural Affairs - Arlington Public Art 1100 N. Glebe Road, Suite 1500, Arlington, Virginia TEL FAX TO: Taylor Lawch, The JBG Companies FROM: Angela Adams, AED DATE: March 9, 2016 SUBJECT: Cliff Garten Revised Concept Design for Central Place Public Art Committee Meeting Vote Public Art Committee Members (present): Courtney Murphy, Chair Kameron Aroom Sunny Carroll Gordon Fraley Betsy Johnson Takis Karantonis Tom Korns (Ex Officio) JBG Representatives and Arlington County Staff: Taylor Lawch, The JBG Companies Cliff Garten, Artist Michelle Isabelle-Stark, AED, Cultural Affairs Angela Adams, AED, Public Art Deirdre Ehlen, AED, Public Art Elizabeth Carriger, AED, Public Art Taylor Lawch of JBG Companies and artist Cliff Garten presented a revised concept plan for Central Place, a mixed use development located directly above the Rosslyn Metro Station to the Public Art Committee on March 2, Garten s concept activates the facades of the podiums of the parking garage with grids of color-changing, programmable LED lights. Two options were presented: A) 112 panels activated with diodes B) 175 panels activated with diodes allowing for the illuminated panels to wrap around the sides of the podiums. Option B would require a $400,000 increase in the project budget, which would be split between JBG and Arlington County. The PAC was asked to approve the concept as well as additional public art funding for an enhanced proposal. The Public Art Committee members present at the meeting were all in favor of the revised concept to move forward for further analysis and consideration for additional funding. The PAC requested to be notified when the mock up takes place. Comments for consideration from the PAC can be found below. PAC Comments: Evaluate how the lights of the cars in the parking garage will impact the light panels, specifically their opacity and the visibility of the electrical components. It was suggested that when a mock up for the project occurs, assess real conditions with cars. Consider how lights from surrounding buildings will impact the art. Take into consideration how the panels will be cleaned especially given the tendency for heat/leds to attract dirt particles.

4 ARLINGTON ECONOMIC DEVELOPMENT Cultural Affairs - Arlington Public Art 1100 N. Glebe Road, Suite 1500, Arlington, Virginia TEL FAX Be mindful of balancing live programming with aesthetics and have defined periods of interactivity. It was suggested that costs be carefully studied and the possibility to cut costs to get closer to the expected minimum site plan determined contribution without sacrificing the full impact of the concept.

5 August 15, 2017 Angela Adams Arlington Arts 1100 North Glebe Road., Suite 1500 Arlington, VA Re: Letter of Support for Central Place Public Art Appropriation Dear Ms. Adams: On behalf of the Rosslyn Business Improvement District, I would like to express our support and appreciation for the appropriation of funds on behalf of Arlington Arts and Arlington County towards the implementation of public art at Central Place, specifically the installation of Cliff Garten s design. Public art is an important community benefit achieved through the development process, and this public-private partnership will provide a legacy project that will help to activate the center of Rosslyn for years to come. The plans were presented to the Rosslyn BID s Urban Design Committee in February of 2016, where the group had detailed discussion about the project, including specific questions regarding the level and timing of lighting and dimming mechanisms. All questions were answered to the satisfaction of the Committee, and although no formal vote was taken, there was enthusiastic support for the design and the use of public art funds for the project. The BID is also very familiar and comfortable with this project, and has provided input at multiple times during the design process. Thank you for considering RBIC's input toward dynamic public art installations which help to create a vibrant public realm. If we can assist in any other way, please don t hesitate to reach out. Sincerely, Mary-Claire Burick, President, Rosslyn Business Improvement Corporation

6 ARLINGTON COUNTY ECONOMIC DEVELOPMENT INCENTIVE GRANT AGREEMENT CENTRAL PLACE PUBLIC ART This ARLINGTON COUNTY ECONOMIC DEVELOPMENT INCENTIVE GRANT AGREEMENT ( Agreement ) is made and entered on the date of full execution ( Effective Date ), by and among the COUNTY BOARD OF ARLINGTON COUNTY, VIRGINIA (the County Board ), a body corporate and politic of the Commonwealth of Virginia; the INDUSTRIAL DEVELOPMENT AUTHORITY OF ARLINGTON COUNTY ( IDA ), a political subdivision of the Commonwealth of Virginia; and CENTRAL PLACE OFFICE, L.L.C., a Delaware limited liability company ( CPO ) (collectively the Parties ). RECITALS WHEREAS, CPO is the developer of the commercial phase of Central Place (the Site ), a mixed-use project located in the Rosslyn area of Arlington County, Virginia, for which the Arlington County Board approved an amendment to Site Plan No. 335 on May 5, 2007 (as amended, Site Plan ); and WHEREAS, Condition No. 65 of the Site Plan required that CPO contribute $750,000, plus CPI-U escalation since 2007, to Arlington County s Public Art Fund; and WHEREAS, on September 16, 2017, the County Board approved an amendment to Condition No. 65 of the Site Plan to allow CPO instead to commission an on-site public art project at Central Place (attached as Exhibit A); and WHEREAS, CPO has worked with the Arlington Economic Development office to develop a public art project ( Project ) (proposed scope drawing attached as Exhibit B), that will complement Arlington County s Corridor of Light concept, a significant County initiative for Rosslyn in the recently adopted Rosslyn Sector Plan; and WHEREAS, the purpose of the Project, consistent with Virginia Code , is to promote industry and develop trade by inducing manufacturing, industrial, governmental, nonprofit and commercial enterprises and institutions of higher education to locate or remain in Arlington County, and particularly in the Rosslyn submarket, and by doing so to benefit the citizens of the County; and WHEREAS, the cost of the Project is estimated to be approximately $1,288,028, which is approximately $500,000 more than the approved Site Plan obligates CPO to spend towards public art on the site; and

7 WHEREAS, the Project is eligible for use of funds from the Rosslyn Fund account, which is designated for public improvements in Rosslyn; and WHEREAS, the County Board has agreed, subject to appropriation and pursuant to the Industrial Development and Revenue Bond Act of the Code of Virginia of 1950, as amended, to provide $200,000 in economic development incentive general funds to the IDA for the benefit of CPO (the EDI Grant ), subject to the terms and conditions of this Agreement; and WHEREAS, CPO has agreed to accept the EDI Grant from the IDA subject to the terms and conditions of this Agreement, including CPO s funding of an additional $300,000 towards the Project, in addition to the public art obligation that is set forth in Condition No. 65 of Site Plan No. 335; and WHEREAS, the County Board, the IDA and CPO desire to set forth their understanding and agreement as to the conditions, payout and use of the EDI Grant proceeds and the obligations of each of the Parties. NOW, THEREFORE, in consideration of the foregoing and the agreements of the Parties, as are hereinafter set forth, and for other good and valuable considerations, mutual benefits, promises and undertakings, the receipt and adequacy of which are hereby acknowledged, the Parties covenant and agree as follows: 1. Incorporation of Recitals. The foregoing recitals are an integral part of this Agreement and set forth the intentions of the Parties and the premises on which the Parties have entered into this Agreement. Accordingly, the foregoing recitals are fully incorporated into this Agreement by this reference as if fully set forth herein. 2. Term. The term of this Agreement shall commence on the Effective Date and continue until the disbursement of the total amount of the EDI Grant, unless terminated earlier as provided herein. 3. Economic Development Incentive Grant. In order to incentivize and induce CPO to make an additional $300,000 capital investment in the Project, the County Board, subject to appropriation and the terms of this Agreement, will provide the EDI Grant in the amount of $200,000 to the IDA for the benefit of CPO. 4. IDA Covenants and Obligations. Upon receipt of the requisite moneys from the County Board to fund the EDI Grant to CPO, the IDA shall, subject to the Disbursement Conditions in Section 6 below, disburse the EDI Grant to CPO pursuant to Section 6. In the event that the County Board fails to appropriate moneys sufficient for the EDI Grant or to transfer the requisite moneys to the IDA to fund the EDI Grant payments to CPO, the IDA shall not be responsible for disbursing to CPO any more moneys than it actually receives from the County for that purpose.

8 5. CPO Obligations. In the event that the full EDI Grant (i.e. $200,000) is not disbursed to and received by CPO for any reason, CPO will have no obligation related to public art on the Site beyond $750,000 plus CPI-U escalation since EDI Grant Disbursement and Conditions. The IDA s obligation to disburse all or a portion of the EDI Grant to CPO is subject to and conditioned on the fulfillment of the following Disbursement Conditions by CPO, the first of which (the County s Acceptance of CPO s Concept Plan and Maintenance, Conservation and Technical Information Form) CPO satisfied prior to execution of this Agreement: (i) Disbursement Condition 1 the County s Acceptance of CPO s Concept Plan and Maintenance, Conservation and Technical Information Form. The IDA shall disburse the first installment of $100,000 of the EDI Grant funds to CPO upon the County s acceptance of (1) CPO s conceptual plan for the public art and (2) the County s Maintenance, Conservation and Technical Information Form ( Form ), provided that CPO submits the conceptual plan and the Form to the County before CPO requests the certificate of occupancy for the buildings to be located at 2101 and 1213 Wilson Boulevard, 1730 Lynn Street, 1811, 1812 and 1881 North Moore Street (RPC# , -002, -003, - 004, -014, -015 and -016). If these benchmarks are not achieved, this Agreement terminates. (ii) Disbursement Condition 2 the County s Acceptance of Completed Project. The IDA shall disburse the second installment of $100,000 of the EDI Grant to CPO upon the County s acceptance of the completed Project. The County Manager or his designee will make a reasonable determination as to whether the Project is completed within ten business days of a request by CPO. If the County Manager or his designee fails to respond during this ten business-day period, the Project will be deemed completed to the satisfaction of the County. 7. Repayment of EDI Grant. If the condition set forth in Section 6(i) above occurs, and the IDA disburses the first $100,000 installment of the EDI Grant to CPO, but then CPO does not complete the Project in accordance with the approved Concept Plan within 24 months, or such longer term that the County Manager might in his discretion allow, then CPO shall within 30 days of a request by the County Board repay to the IDA the full $100,000 that CPO received from the IDA. 8. Future Phase of the Project. CPO will not deny unreasonably a future request by County to install an additional phase of the Project at the location depicted in Exhibit C provided that such installation will be subject to a commercially reasonable access agreement and in keeping with an art installation typical of a trophy-quality office building.

9 9. Miscellaneous Provisions. (i) Notices, Demands, and Communications between the Parties. Formal notices, demands and communications between the Parties shall be given by (a) personal service; (b) reputable document delivery service, such as Federal Express, with a receipt showing date and time of delivery; or (c) certified or first-class United States mail, postage prepaid, with a receipt showing date and time of delivery. All notices, demands and communications shall be addressed to the following and to any other addresses that a Party designates in writing: To the County: With Copies to: Arlington County 2100 Clarendon Boulevard, Suite 302 Arlington, Virginia Attn: Mark Schwartz, County Manager mschwartz@arlingtonva.us Arlington County Office of the County Attorney 2100 Clarendon Blvd, Suite 403 Arlington, Virginia Attn: Stephen A. MacIsaac, County Attorney smacisaac@arlingtonva.us Arlington County Arlington Economic Development 1100 North Glebe Road, Suite 1500 Arlington, Virginia Attn: Victor L. Hoskins, Director vhoskins@arlingtonva.us To CPO: c/o JBG Smith 4445 Willard Avenue, Suite 400 Chevy Chase MD Attn: Taylor Lawch tlawch@jbgsmith.com c/o JBG Smith 4445 Willard Avenue, Suite 400 Chevy Chase MD Attn: Aaron Herman aherman@jbgsmith.com

10 Venable LLP 8010 Towers Crescent Drive, Suite 300 Tysons Corner, VA Attn: Kedrick N. Whitmore, Esq. To the IDA: Industrial Development Authority of Arlington County 2100 Clarendon Blvd, Suite 501 Arlington, Virginia Attn: Jason Friess, Secretary/Treasurer (ii) Entire Agreement; Amendments. This Agreement constitutes the entire agreement among the Parties as to the EDI Grant and may not be amended or modified, except in writing signed by each of the Parties. This Agreement shall run with the land and be binding upon and inure to the benefit of the Parties and their respective successors and assigns. CPO may not assign its rights and obligations under this Agreement without the prior written consent of the County Board and the IDA, which shall not be unreasonably withheld. (iii) Records Retention and Audit. CPO must retain all books, records and other documents related to this Agreement for at least five years after the final payment and must allow the County or its authorized agents to examine the documents upon request during the retention period and during the term of this Agreement. The County s right to examine does not extend to any contracts or other agreements with third parties. (iv) Governing Law; Venue. This Agreement is made and is intended to be performed in Arlington County, Virginia, and shall be construed and enforced by the laws of the Commonwealth of Virginia. Jurisdiction and venue for any litigation arising out of or involving this Agreement shall lie in the Circuit Court of the County of Arlington, and such litigation shall not be brought in any other court. (v) No Third-Party Beneficiaries. No provision of this Agreement shall be construed to confer any rights upon any person or entity who is not a Party, whether as a third-party beneficiary or otherwise. (vi) Relationship of Parties. The provisions of this Agreement are intended solely for the purpose of defining the relative rights of the Parties and do not create any partnership, joint venture or other joint enterprise among the Parties. (vii) Severability. If any term, provision, covenant, or condition of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions will remain in force, to the extent that they are not rendered impractical to perform, taking into consideration the purposes of this Agreement. The Parties further agree that in such event, and to the maximum extent permitted by law, they

11 shall take all steps necessary to make valid this Agreement or the portion that is found to be unenforceable. (viii) Interpretation. The terms of this Agreement shall be construed in accordance with the meaning of the language used and not for or against any Party by reason of the authorship or any other rule of construction that might otherwise apply. The Section headings are for purposes of convenience only and shall not be construed to limit or extend the meaning of this Agreement. (ix) Determinations; Disbursements. (a) Any determination by the County Manager of fulfillment or non-fulfillment of the terms of this Agreement by CPO shall be binding on the IDA. The IDA may request such determinations by the County Manager as necessary. (b) The IDA shall have no responsibility to disburse any funds to CPO beyond the amount that the IDA has received from or on behalf of the County Board for the purpose. (x) Non-Liability of Officials, Employees and Agents. No member, official, employee or agent of the County Board or the IDA shall be personally liable to CPO in the event of any default or breach by the County Board or the IDA or for any amount that may become due to CPO or its successors or assigns or on any obligation under the terms of this Agreement. (xi) Attorney s Fees. Each Party shall pay its own attorney s fees. (xii) Business Day Convention. If the date of any required action falls upon a weekend day or a holiday when the New York Stock Exchange is not open for business, the required action may be deferred to the next business day. (xiii) Force Majeure. No Party will be held responsible for failing to fulfill an obligation under this Agreement if such failure is a result of a fire, riot, rebellion, natural disaster, war, act of terrorism or act of God that is beyond the control of the Party and that makes performance impossible or illegal, unless otherwise specified in the Agreement (xiv) Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be an original and all of which together shall be one and the same instrument. [Signatures and acknowledgments appear on the following pages]

12 IN WITNESS WHEREOF, the County Board, the IDA, and CPO have each executed, or caused to be duly executed by an authorized representative, this Economic Development Incentive Grant Agreement under seal in duplicate, as of the day and year written above. Approved as to form: Stephen A. MacIsaac, County Attorney THE COUNTY BOARD OF ARLINGTON COUNTY, VIRGINIA, a body corporate and politic of the Commonwealth of Virginia By: Mark Schwartz, County Manager ACKNOWLEDGMENT COMMONWEALTH OF VIRGINIA COUNTY OF ARLINGTON On this the day of, 2017, before me, personally appeared Mark Schwartz, who acknowledged himself to be the County Manager of Arlington County in the above instrument, and that he, as Acting County Manager, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the County Board of Arlington County, Virginia, a body corporate and politic of the Commonwealth of Virginia by himself as Acting County Manager of Arlington County, Virginia IN WITNESS WHEREOF, I hereunto set my hand and official seal. Notary Public My Commission Expires:

13 INDUSTRIAL DEVELOPMENT AUTHORITY OF ARLINGTON COUNTY, VIRGINIA, a political subdivision of the Commonwealth of Virginia By: Name: Title: ACKNOWLEDGMENT COMMONWEALTH OF VIRGINIA COUNTY OF ARLINGTON On this the day of, 2017, before me, personally appeared, who acknowledged himself to be the Chairman of the Industrial Development Authority of Arlington County, Virginia in the above instrument, and that he, as Chairman, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of the Industrial Development Authority of Arlington County, Virginia, a political subdivision of the Commonwealth of Virginia by himself as Chairman of the Industrial Development Authority of Arlington County, Virginia. IN WITNESS WHEREOF, I hereunto set my hand and official seal. Notary Public My Commission Expires:

14 CENTRAL PLACE OFFICE, L.L.C., a Delaware limited liability Company By: JBG/Company Manager IV, L.L.C., its managing member By: Name: Title: ACKNOWLEDGMENT STATE OF COUNTY OF On this the day of, 2017, before me, personally appeared, who acknowledged himself to be the of in the above instrument, and that he, as, being authorized so to do, executed the foregoing instrument for the purposes therein contained, by signing the name of, a by himself as of. IN WITNESS WHEREOF, I hereunto set my hand and official seal. Notary Public My Commission Expires:

15 Exhibit A May 5, 2007 SP #335 SITE PLAN AMENDMENT: Central Place LLC, construct approx. 354 dwelling units, approx. 600,855 sq ft commercial/retail space, with modification of use regulations for density, storage, mechanical rooms, shafts, observation decks, coverage, parking, loading space and drive aisle requirements; 1213 Wilson Blvd., 1730, 1735 N. Lynn St., 1801 N. Lynn St., 1801, 1823 N. Moore St., Lots 1, 2, 3, 4, 5, and Outlots A-3, A-4 and A-5, Block 10, Rosslyn (RPC # , -002, -003, -004, -005, -006, -008, -009, -010, 011, -012, -013; , -018) Public art 65. The developer agrees to make a contribution to the Public Art Fund in the amount of $750,000 to support County public art initiatives described in the Public Art Master Plan (adopted December 2004) and the goals of the Public Art Policy (adopted September 2000). Such funds shall be used to commission public art within the Rosslyn metro area. Such contribution shall be made to the Public Art Fund prior to issuance of the first certificate of occupancy for Phase II, the residential building. If the contribution is made more than 36 months after site plan approval, the contribution amount will be adjusted based on the percentage change in the Consumer Price Index- Urban (CPI-U) between the date of site plan approval and the first day of the month in which the contribution is made.

16 Exhibit B Proposed scope of artwork Plaza facing podium of residential building (proposed current project site)

17 Exhibit C Plaza facing podium of commercial building (proposed future project site)