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HomeMy WebLinkAbout6.a. SKB Environmental - Host Community AgreementCity of Rosemount Executive Summary for Action City Council Meeting Date: August 6, 1996 Agenda Item: SKB Environmental - Host Community Agenda Section: Agreement New Business Prepared By: Andrew Mack Agenda TTEM #6- A Senior Planner Attachments: Resolution, Host Community Agreement Approved By: FA As part of the proposed expansion of the SKB Landfill expansion project, the property owner (PAB) and the landfill operator (SKB Environmental) have proposed agreement language to the City for "hosting" the proposed facility in Rosemount. This agreement is not something that is being conditioned as part of the Interim Use Permit, but is rather a good faith effort on the part of the owner/operator to negotiate a direct payment to the City in lieu of a landfill abatement fee as provided for under State Statute. From the City's perspective, the host agreement provides much greater flexibility for use of the funds and does not restrict the method of assessing the fees or limit the percentage of the maximum charge per cubic yard with credits for the facility design. The City also benefits through the ability to negotiate for additional incentives in the agreement. The two primary features providing direct benefit to the City in the agreement are as follows: SKB and PAB agree to pay the City a total of $100,000 within approximately 1 year from the date they begin to bring C&D waste into Rosemount. One half due on December 1, 1996 and the remaining payment due on December 1, 1997. These funds are essentially unrestricted and can be used for whatever purpose the City deems to be most appropriate. 2. The City Departments receive free use of the facility for up to 500 cubic yards annually during the entire operating life of the landfill. At the current rate of $7.35 per cubic yard, the City would gain the potential savings of up to $36,750 over the ten year remaining expected life of the landfill. Due to the complexity and near impossibility of trying to monitor waste volumes broken out by city, it was agreed that it would be most effective to base the fee upon the total design volume of the facility, rather than having to rely upon a reporting of dumping activity. The design volume or "compacted volume" of waste is at a ratio ranging between 40-50% of "loose volume." Therefore, by doubling the design volume of 112,000 c.y. and multiplying by the maximum of .50 cents per c.y. authorized by statute, we arrived at a total host community fee of $112,000 to be paid. Staff's position was that the City of Rosemount would prefer not to receive this payment on a monthly basis similar to that of Inver Grove Heights (over a 60 month period); but would rather receive the payment in a lump sum initially with approval of the project. SKB initially proposed the amount over a 36 month period, but agreed to complete the full payment of the fee two years earlier as requested by Staff, provided a slightly reduced amount (the $100,000 figure) would be agreed to for offsetting the time value of money for early payment. Upon review of the City's position for interest revenue, it was determined that the proposed amount would be fair to both the City and SKB/PAB. The City Attorney was present for discussions concerning the language of the agreement and the subsequent wording changes that were agreed to from an initial draft. Charlie will be reviewing the revised agreement prior to Tuesday night's meeting for any other technical/legal issues which may otherwise still need to be addressed. Staff is comfortable with current form of the agreement and recommends approval subject to final review and incorporation of all comments by the City Attorney. Recommended Action: MOTION to adopt a Resolution Approving A Host Community Agreement between SKB Environmental, Inc., PAB Enterprises of Minnesota, Inc. and The City of Rosemount, subject to final review and incorporation of all comments by the City �Ltto�m--g City Council Action: CITY OF ROSEMOUNT DAKOTA COUNTY, MINNESOTA RESOLUTION 1996- A RESOLUTION APPROVING A HOST CommuNITY AGREEMENT BETWEEN SKB ENviRoNmENTAL, INC.,, PAB ENTERPRisEs OF MINNESOTA, INC. AND THE CITY OF Rosmouw WHEREAS, the City of Rosemount has received a proposed Host Community Agreement from SKB Environmental, Inc. and PAB Enterprises of Minnesota, Inc. providing for payment of a host community fee to the City of Rosemount for hosting expansion of the landfill known as the Rich Valley Demolition Disposal Facility in the Rosemount Corporate Limits on property legally described as follows: Those parts of the South Half of the Southwest Quarter of Section 33, Township 27, Range 22, and Government Lot 1, Section 11, Township 115, Range 19 Dakota County, Mnnesota, which lie easterly of the Mdwestern Railroad Properties, Incorporated right-of-way (formerly the Chicago, Rock Island and Pacific Railway Company right-of-way); and That part of Governmental Lot 2, Section 12, Township 115, Range 19, lying westerly of the westerly right- of-way of the Chicago and North Western Transportation Company, formerly known as Chicago and North Western Railway Company; and WHEREAS, SKB Environmental, Inc., PAB Enterprises of Minnesota, Inc. and the City of Rosemount have mutually agreed to enter into a Host Community Agreement, in lieu of collecting a landfill abatement fee as authorized by State Law, which addresses operations and consultations, host community fee and other aspects of the ongoing relationship between the City of Rosemount, SKB Environmental, Inc. and PAB Enterprises of Minnesota, Inc.; and WHEREAS, the City of Rosemount has the authority to enter into this agreement pursuant to powers granted to it by Minnesota Statutes Chapters 412, 429, 444, 462, 465, 471, and by authorization of the City Council. NOW, THEREFORE, BE IT RESOLVED, the City Council of the City of Rosemount hereby approves the Host Community Agreement between SKB Environmental, Inc., PAB Enterprises of Minnesota, Inc. and the City of Rosemount subject to final review and incorporation of all comments by the City Attorney. ADOPTED this 6th day of August, 1996. Cathy Busho, Mayor ATTEST: Susan M. Walsh, City Clerk Motion by: Seconded by: Voted in favor: Voted against: 2 HOST COMMUNITY AGREEMENT AMONG SKB ENVIRONMENTAL, INC., PAB ENTERPRISES OF MINNESOTA, INC., THE CITY OF ROSEMOUNT, MINNESOTA HOST COMMUNITY AGREEMENT AMONG SKB ENVIRONMENTAL, INC., PAB ENTERPRISES OF MINNESOTA, INC., AND THE CITY OF ROSEMOUNT, MINNESOTA TABLE OF CONTENTS Section Page SECTION 1. RECITALS I 1.01 Parties 1 1.02 The Landfill 1 1.03 Landfill Regulation 1 1.04 City Authority 1 1.05 Landfill Status 1 1.06 Reissuance of SW -3 )43 ) 2 1.07 Potential Integrated Waste Management Facility 2 1.08 Purpose 2 SECTION 2. AUTHORITY 3 2.01 Authority SKB and PAB 3 2.02 city 3 SECTION 3. ADMINISTRATION 3 3.01 Primary Responsibility 3 3.02 Points of Contact 3 3.03 Notices 3 SECTION 4. OPERATIONS AND CONSULTATIONS 4 4.01 Operational Compliance 4 4.02 Dispute Resolution 4 SECTION 5. INSURANCE, CONTINGENCY PLAN 5 5.1 Insurance 5 5.2 Contingency Action Plan 5 5.3 Hazard Identification; Planning 5 5.4 Off -Site Notice and Evacuation 5 SECTION 6. ASSURANCES 5 6.01 Indemnification and Release 5 6.02 Financial Assurances 6 SECTION 7. HOST COMMUNITY FEE 7 7.01 Host Community Fee 7 7.02 Use of Fee 8 7.03 Fee to Continue for Term of Agreement 8 7.04 No Escalator 8 7.05 City's Wastes 8 SECTION 8. FUTURE APPLICATIONS 9 8.01 Future Applications 9 SECTION 9. GENERAL PROVISIONS 9 9.01 Agreement Not to Alter or Amend Other PAB or SKB Legal Responsibilities 9 9.02 Governing Law 10 9.03 Entire Agreement 10 9.04 Successors and Assigns 10 9.05 Authorization 10 9.06 PAB's and SKBs Obligations 10 9.07 Tenn/Termination 10 9.08 Recording 10 SECTION 10. SIGNATURES I I HOST COMMUNITY AGREEMENT AMONG SKB ENVIRONMENTAL, INC., PAB ENTERPRISES OF MINNESOTA, INC., AND THE CITY OF ROSEMOUNT, MINNESOTA SECTION 1. RECITALS. 1.01 Parties. This HOST COMMUNITY AGREEMENT (Agreement), dated as of 1996, is entered into by and among the city of Rosemount (City), a Minnesota municipal corporation, SKB Environmental, Inc. (SKB), a Minnesota corporation, and PAB Enterprises of Minnesota, Inc. (PAB), a Minnesota corporation (each referred to singly as Party or together as Parties). 1.02 The Landfill. PAB owns and SKB operates a demolition landfill known as the Rich Valley Demolition Disposal Facility (Rich Valley or Landfill) and perforins certain materials recovery activities as part of that operation. SKB also operates a solid waste transfer station on the site. The Landfill is located partially within the city of Rosemount, Dakota County, Minnesota. 1.03 Landfill Regulation. SKB operates the Landfill pursuant to Solid Waste Permit No. 343 as amended or reissued from time to time (SW -3 )4-3 )), issued by the Minnesota Pollution Control Agency (MPCA), various licenses issued by Dakota County, and other applicable laws and regulations. 1.04 City Authority. The City possesses certain regulatory authority over Rich Valley, including, but not limited to, zoning authority and surface water drainage authority. 1.05 Landfill Status. The Landfill includes a lined landfill area which has a leachate collection system. It is not on the National Priority List (NPL) or the Minnesota Permanent List of Priorities, and is not subject to any remedial action requirements, nor is it under investigation by any federal or state agency or authority. I 1.06 Reissuance of SW -343. SW -343 was issued in August of 1989 with a five year term expiring in 1994. In 1994, SKB and PAB submitted an application for reissuance of SW -343 to the UTCA, which was granted. 1.07 Potential Integrated Waste Management Facility. The Landfill has a permitted airspace capacity of approximately -3 ).4 million cubic yards of which approximately 112,000 cubic yards are located within Rosemount City boundaries. SKB intends to continue operating the Landfill until the remaining unused airspace capacity has been filled and SKB has complied with all conditions of the City's Interim Use Permit (IUP and the Landfill is closed). The potential exists at the current facility for an integrated waste management facility that may consist of, among others, the following elements: 1.07.01 Continuation of the Construction and Demolition (C & D) debris (including acceptance of all waste materials which were acceptable at a C & D landfill at the time the original Interim Use Permit was approved) Disposal and Recycling Unit on the Landfill; 1.07.02 Solid Waste Transfer Unit; and 1.07.03 Construction and demolition debris materials separation, recovery and recycling facility; Nothing herein should be interpreted to imply an approval of items 1.07.02 or 1.07.03. 1.08 Purpose. This Agreement is entered into for the purposes of- (1) establishing the principles of association between the City as the host community to the Landfill and PAB and SKB as the owner and operator, respectively, of the Landfill; and (2) providing compensation to the City for the anticipated direct and indirect costs associated with the presence and operation of the Landfill 2 and its related solid waste management units and activities. SECTION 2. AUTHORITY. 2.01 Authority. SKB and PAB enter into this Agreement pursuant to powers granted to them by Minn. Stat. Chapter -302A and by authorization of their respective Board of Directors. 2.02 City. The City enters into this Agreement pursuant to powers granted to it by Minn. Stats. Chapters 412, 429, 444, 462, 465 and 471 and by authorization of the City Council. SECTION 3. ADMINISTRATION. 3.01 Primary Responsibility. This Agreement shall be administered by the Parties' Points of Contact. 3.02 Points of Contact. 3.02.01 The City's Point of Contact. The City's Point of Contact shall be its City Administrator, 2875 - 145th Street West, Rosemount, Minnesota 55068, Telephone: (612) 423-4411, Fax (612) 42-3 )-5203. 3.02.02 SKB/PAB's Point of Contact. SKB's Point of Contact shall be SK -B's President, at 251 Starkey Street, St. Paul, Minnesota 55107, Telephone (612) 224- 6329, Fax (612) 223-5053. PAB's point of contact shall be President, PAB Enterprises of Minnesota, Inc., 9050 Jefferson Trail West, Inver Grove Heights, Minnesota 55077, Telephone (612) 686-7001 , Fax (612) 687-9857. 3.03 Notices. Any notice, demand, direction, request, or other instrument authorized or required by this Agreement to be given to or filed with any Party or any agency, shall be deemed sufficiently given or filed if and when sent by United States certified or registered mail, return 4 receipt requested, postage prepaid, addressed to the Party to receive the same, to the attention of that Party's Point of Contact. SECTION 4. OPERATIONS AND CONSULTATIONS. 4.01 Operational Compliance. The Landfill shall be operated in accordance with SW- 343, applicable Dakota County licenses, as amended and reissued from time to time, any permit issued by the City, as it may be amended from time to time, and all other applicable laws and regulations. 4.02 Dispute Resolution. 4.02.1 The Parties will use their best, good faith efforts to resolve informally any dispute arising under this Agreement. If a request for mediation is given by either the City or SKB and/or PAB, the Parties shall cooperate in good faith in the selection of a mediator and in the pursuit of mediation procedures. The City, SKB and/or PAB may each submit recommendations for a mediator and shall select the mediator by mutual agreement. After selection of a mediator, the Parties shall meet with the mediator within 3 )0 days or as soon as possible subject to the mediator's schedule. The mediation may be terminated only by execution of a settlement agreement by the Parties or by a written declaration by the mediator that further mediation proceedings would be unlikely to succeed. The cost of the mediator shall be shared equally by the Parties. Costs relative to producing documents, witnesses or other material relative to the presentation by each party to 4 the mediation shall be borne by the party producing such document, material or witness. The Parties shall carry on work and meet their respective obligations under the ternis of all applicable agreements, licenses and permits during all disputes, except as they may otherwise agree in writing. SECTION 5. INSURANCE, CONTINGENCY PLAN. 5.1 Insurance. SKB and PAB shall maintain at all times insurance covering liability, property, and casualty losses at the Landfill. Such insurance shall at least be in the amounts specified by Dakota County Ordinance No. 110. SKB and PAB shall provide the City with evidence that insurance coverage required by this Agreement is in force and effect. 5.2 Contingency Action Plan. SKB and PAB shall provide the City and its designees with copies of SKB's Contingency Action Plan that is required by the MPCA and Dakota County. SKB and PAB shall provide the City with copies of all amendments to the Contingency Action Plan in a timely manner. The Contingency Action Plan shall address and make provisions for controlling air emissions, leachate generation, and water runoff during the course of a fire at the Landfill 5.3 Hazard Identification; Planning. SKB and PAB shall identify any potential fire hazards at the Landfill and shall cooperate with the City in developing adequate fire and emergency procedures for fighting fires at the Landfill. 5.4 Off -Site Notice and Evacuation. Within 180 days from the date of this Agreement, SKB and PAB shall develop a mutually satisfactory evacuation plan that describes the geographical area to be notified, when and to whom notice will be given, how and under what circumstances persons will be evacuated during a Landfill fire, and how the evacuation costs will be handled. R SECTION 6. ASSURANCES. 6.01 Indemnification and Release. PAB and SKB shall release, defend, indemnify, and hold harmless the City, its officers, agents, employees, elected and appointed officials, boards, political bodies, and volunteers (Indemnified Parties) from and against any and all damages based upon or arising out of the following, whether or not PAB or SKB otherwise has any responsibility therefor and whether occurring in the past, present, or future: a. SKB's conduct of operations of the Landfill; b. waste or substances treated, stored, disposed, or contained in the Landfill; C. waste or substances emanating or released from the Landfill; and d. a failure of SKB or PAB to satisfy any legal requirements related to the foregoing and/or a failure of PAB or SKB to satisfy the duties and obligations under this Agreement. This section shall not be deemed to abrogate the sovereign immunity enjoyed by the City or the statutory liability limits provided by Minn. Stat. Chap. 466, as amended from time to time. PAB's and SKB's responsibility for indemnification under this section is limited to the City's liability limits set forth in Minn. Stat. Chap. 466, as amended from time to time. PAB and SKB shall not be responsible for the Indemnified Parties's negligence, gross or wilful negligence or breach of contract and shall not release, defend, indemnify, or hold harmless the Indemnified Parties for Damages based on or arising from negligence, gross or wilful negligence or breach of contract. 6.02 Financial Assurances. SKB and PAB shall maintain in full force and in effect all insurance, bonds, letters of credit, or cash deposits required to be maintained by municipal, county, state, and federal law in order to assure completion, closure, and post -closure care and maintenance 31 of the Landfill and the requirements of the City's Interim Use Permit. SKB and PAB shall also provide the City with such copies as it may request of all insurance policies, bonds, letters of credit, and any other financial assurance instruments and documents on a timely basis. SECTION 7. HOST COMMUNITY FEE. 7.01 Host Community Fee. In consideration for the City's serving as the host community to the Landfill, in consideration for ongoing direct and indirect costs associated with the presence and operation of Rich Valley, its related solid waste management units and activities, and its emergency preparedness planning, and in consideration of all other matters as set forth in this Agreement, PAB or SKB shall pay the City a Host Community Fee (HCF) of $100,000, payable in two equal installments. Subje , ct to Section 7.03) the first payment shall be made on December 1, (J-" W�V� 1996,Rrovided all necessary state, county and local permits (including the City of Inver Grove Heights) have been obtained and construction of the proposed southerly modification of the plan by " 'a"� 0 9&7Vx-, - SKB and PAB is to the point where it is ready for acceptance of debris. The second payment shall be made on December 1, 1997, subject to Section 7.03 ). PAB and SKB are jointly and severally responsible for making said payments. As used in this Agreement, the term "proposed southerly modification" means that modification which is identified in SKB's application to the MPCA for permit modification. The Parties agree that the HCF shall be the only fee charged by the City for solid waste uses conducted by PAB and SKB, and their affiliates and subsidiaries, except for customary permit fees (e.g., building permits and zoning application fees), utility use fees (e.g., water bills), fees incident to platting and subdivision (e.g., park dedication fees), real estate taxes, and special assessments for public improvements. Such customary fees shall be nondiscriminatory comparable 7 to what is charged to others for similar permit, utility and incidental fees. If the City shall be required by law to collect from SKB or PAB an abatement fee or similar landfill fee in addition to the HCF, the HCF due and owning to the City shall be reduced by an amount equal to the amount pdw,_,,0 -F�-� L4 of such requir+batementfee-e�� the City. The Parties acknowledge that if an abatement fee is imposed after December 1, 1997, no offset will be available. The City agrees not to impose any abatement fee unless such fee is mandated by law. 7.02 Use of Fee. The HCF shall be used by the City for public purposes. Such purposes may include, among others: general fund purposes; the cost of hosting the Landfill; the cost of providing fire fighting services; environmental review and monitoring; and meeting and conferring with, among others, SKB, PAB, Dakota County, the MPCA, the United States Environmental Protection Agency, the Metropolitan Council, the Office of Environmental Assistance, and any other body having jurisdiction over the Landfill; or other legal public purposes. 7.03 Fee to Continue for Term of Agreement. PAB and SKB agree that the HCF described in Section 7.01, above, shall be paid regardless of future events, e.g., even if waste volumes drop to zero, or the Landfill ceases operation during the term of this Agreement except if, prior to December 1, 1997, federal, state, county or local laws, rules, regulations or ordinances are enacted, amended, repealed or changed in any way which prohibits operation of the Landfill, outside of the control of SKB and/or PAB, or prohibits acceptance of materials acceptable as of the date of this Host Agreement, which comprise more than 20% of existing landfill volumes, or make the cost of continued operation of the Landfill prohibitive. 7.04 No Escalator. The HCF described in Section 7.01, above, is an agreed-upon sum and shall not be subject to any adjustment for inflation or disinflation for the term of this Agreement 1.01 except as provided in Section 7.033. 7.05 City's Wastes. SKB and PAB will allow disposal of nonhazardous wastes acceptable at the Landfill from City Departments for the life of the Landfill at no charge to the City up to 500 cubic yards (truck volume) annually. City Departments will include City Hall, public works, fire, park and other similar City Departments. This Section 7.08 does not apply to residences, businesses, or other sources of solid waste not listed above as City Departments. SECTION 8. FUTURE APPLICATIONS. 8.01 Future Applications. The City agrees that it will in good faith consider any future applications by SKB and PAB for permits, interim use permits, or zoning variances and act on such applications in a timely manner after public hearings, and after required applications and payment of appropriate fees and appropriate review and recommendations by the City's Planning Commission. The City agrees to make its staff and consultants available to suggest appropriate provisions for the applications. PAB and SKB acknowledge and agree that the City cannot and does not undertake in this Agreement to bind itself to grant any approvals, permits, zoning or rezoning applications, or other matters within the legislative or quasi-judicial discretion of the City Council. SKB and PAB may apply for permits or zoning variances at times of their own choosing. Nothing contained in this Agreement shall be deemed to require the City to issue permits or variances. The City reserves the right to impose reasonable terms and conditions on any permit that it may issue. SECTION 9. GENERAL PROVISIONS. Except as this Agreement may specifically provide to the contrary, the following Z, provisions shall apply to all parties to this Agreement: 9.01 Agreement Not to Alter or Amend Other PAB or SKB Legal Responsibilities. This Agreement does not shift, alter, amend or lessen SKB's or PAB's duties and responsibilities as set forth in Dakota County's solid waste license(s) or SW -343. 9.02 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the state of Minnesota. 9.03 Entire Agreement; Amendments. This Agreement may not be modified except by an instrument in writing and duly executed by the Parties. MPCA permit or Dakota County license modifications shall be deemed to automatically modify this Agreement accordingly and thus requires no further written change by the Parties. 9.04 Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors and assigns. PAB and SKB may assign this Agreement only with the express written consent of the City, which shall not be unreasonably withheld. In the event of any assignment, however, SKB and PAB shall remain fully responsible to assure that their respective duties and responsibilities as expressed in this Agreement are fully performed. 9.05 Authorization. The City, PAB and SKB warrant each to the other that each has taken all actions necessary to authorize it to execute, deliver, and carry out this Agreement. 9.06 PAB's and SKB's Obligations. The City shall have no obligation to pay any part of PAB's and SKB's expenses in carrying out their obligations under this Agreement. 9.07 Term/Termination. This Agreement may not be terminated before the end of its term by any Party without the express, written consent of the other Parties. 10 9.08 Recording. Within 30 days after execution of this Agreement by all Parties, SKB and PAB may record a summary memorialization of this Agreement with the Dakota County Recorder. 9 D 9 All,, al -fu VT(k�� 5AtJ +t, SECTION 10. SIGNATURES. By their signatures below, the undersigned represent that they have authority to bind the Parties that they represent, their agents, subsidiaries, successors, and assigns with respect to the performance of this Agreement. IT IS SO AGREED: Date: Date: I I CITY OF ROSEMOUNT: By Cathy Busho, Mayor By Thomas D. Burt, City Administrator APPROVED AS TO FORM: By Charles L. LeFevere Kennedy and Graven 470 Pillsbury Center Minneapolis, MN 55402 (612) 337-9300 (for the City of Rosemount) Date: Date: Date: STATE OF MINNESOTA) )ss. COUNTY OF 9-3 Dawn L. Gagne Corporate Counsel SKB Environmental, Inc. 251 Starkey Street St. Paul, MN 55107 (612) 224-6299 SKB ENVIRONMENTAL, INC. M Richard O'Gara, President PAB ENTERPRISES OF MINNESOTA, INC. M Palmer Peterson, President The foregoing instrument was acknowledged before me this. day of August, 1996, by Richard O'Gara, its President, and Dawn L. Gagne, its Corporate Counsel, on behalf of SKB Environmental, Inc., a Minnesota corporation. Notary Public I? STATE OF MINNESOTA) )ss. COUNTY OF The foregoing instrument was acknowledged before me this. day of August, 1996, by , its , and its on behalf of PAB Enterprises of Minnesota, Inc., a Minnesota corporation. Notary Public STATE OF MINNESOTA) )ss. COUNTY OF The foregoing instrument was acknowledged before me this. day of August, 1996, by Cathy Busho, Mayor, and Thomas D. Burt, City Administrator, on behalf of the City of Rosemount, a Minnesota municipal corporation. Notary Public