Discussion and possible action to approve a budget amendment in the amount of $41 million from the City's contingency appropriation to fully purchase (patent) the remaining state land in the Peoria Innovation Core 2. 

In August of 2025, the City of Peoria successfully bid to purchase 834 acres of land from Arizona State Land Trust (ASLD).  In order to minimize costs associated with the development of the Peoria Innovation Core 2 (PIC 2), staff seeks to refinance its purchase of this land.  The purchase arrangement with ASLD required a down payment of 10% of the bid amount. This was paid at the time of the transaction.  Further, the City immediately patented another 144 acres for Amkor and associated undevelopable land and roads.  The balance of the bid, plus interest, is due upon the patent of any portion of the land acquired.  That interest rate is prime plus 250 basis points.  When the City patented 144 acres for Amkor in August 2025, that interest rate equated to 8.86%.  As a government entity, the City can acquire much more favorable interest rates.  This requires completing the purchase, or full patent, of the remaining land.  

As the full patent of the land was not a budgeted expenditure when the Fiscal Year 2026 Budget was adopted in May of 2025, it is necessary to make a budget amendment.  

The full patent of the ASLD land in PIC 2 requires an expenditure of approximately $41 million.  This expenditure will be financed through a future debt instrument.  The expenditure will be reimbursed through the sale of the same land to private entities.  Staff has assumed a six (6) year period to sell the parcels of PIC 2.  All costs, including land and infrastructure, are expected to be recovered with these sales.