HomeMy WebLinkAbout5.c. MnDot Agency Agreement/J
FU
DATE: FEBRUARY 26, 1987
• � r rr � •- r
I have received a written response from our City Attorney,
Dave Grannis, which I have attached. As you can see from
Dawes' response, the agreement is as we suspected, that being
very one sided towards MnDot.
I would still recommend that Council enter into the Agency
Agreement because I do not feel the four points that Dave
sent us in his letter are that critical. For example, it
would be extremely difficult for either the City or the
Comatissicner of Transportation to reject bids if the bid was
submitted by the lowest responsible bidder. As for item #2,
FAU funds do not provide for engineering services. The only
cost FAU covers are for construction only. As for item #3,
any plans and specifications the City would have to prepare
for an FAU job would have to be in accordance with the FAU
guidelines and undoubtedly MnDot guidelines. Also finally,
for the City to find unsatisfactory work, we would have to
have sufficient documentation of defective work or materials.
FAU projects require an inordinate amount of documentation.
Therefore I do not feel this would be a problem either.
If the City should ever wish to use FAU funds on any project
eligible for those funds, then we must have entered into this
agreement to obtain the FAU funds. Although we technically
would not have to enter into this agreement until we have a
FAU project, I would not want to jeopardize future funding
for such a project by waiting.
I will be available at the March 3, 1987 Council meeting to
answer any questions which may arise regarding this
agreement.
1987 05
Mr. Richard M. Hefti, P.E.
City Engineer/Public Works Director
City of Rosemount
2875 - 145th St. W.
Rosemount, MN 55068
Re
Dear Rich:
At your request I have reviewed the proposed Minnesota Depart-
ment of Transportation Agency Agreement and make the following
comments:
The Agreement is in my opinion defective for a number of
reasons, some of which are as follows:
1. The Commissioner can accept or reject bids despite
what the City Council wants. (Pages 2 and 7)
2. The City has to furnish such personnel as the Commis-
sioner wants without charge. (Page 3)
3. The Commissioner can change plans and specifications
without City Council approval. (Page 3)
4. If the City finds the completed work unsatisfactory,
the Commissioner can reject that determination. (Page 8)
As drafted the Agreement is heavy-handed and totally one-
sided. If such an agreement is necessary, I recommend that it
be redrafted. -
Very truly yours,
GRANNIS, GRANNIS, FARRELL
& KNUTSON
By: �\
David L. Grannis, III
DLGIII/kd
�s
19 8 7 0 5
LAW OFFICES
GRANNIS, GRANNIS, FARRELL & KNUTSON
DAVID L. GRANNIS - 1874-1961
PROFESSIONAL ASSOCIATION
TELECOPIER:
DAVID L. GRANNIS, JR. - 1910-1980
POST OFFICE BOX 57
(612) 455-2359
DAVID L. HARMEYER
VANCE B. GRANNIS
403 NORWEST BANK BUILDING
M. CECILIA RAY
VANCE B. GRANNIS, JR.
161 NORTH CONCORD EXCHANGE
ELLIOTT B. KNETSCH
PATRICK A. FARRELL
DAVID L. GRANNIS, III
SOUTH ST. PAUL, MINNESOTA 55075
MICHAEL J. MAYER
ROGER N. KNUTSON
TELEPHONE: (612) 455-1661
February 12, 1987
Mr. Richard M. Hefti, P.E.
City Engineer/Public Works Director
City of Rosemount
2875 - 145th St. W.
Rosemount, MN 55068
Re
Dear Rich:
At your request I have reviewed the proposed Minnesota Depart-
ment of Transportation Agency Agreement and make the following
comments:
The Agreement is in my opinion defective for a number of
reasons, some of which are as follows:
1. The Commissioner can accept or reject bids despite
what the City Council wants. (Pages 2 and 7)
2. The City has to furnish such personnel as the Commis-
sioner wants without charge. (Page 3)
3. The Commissioner can change plans and specifications
without City Council approval. (Page 3)
4. If the City finds the completed work unsatisfactory,
the Commissioner can reject that determination. (Page 8)
As drafted the Agreement is heavy-handed and totally one-
sided. If such an agreement is necessary, I recommend that it
be redrafted. -
Very truly yours,
GRANNIS, GRANNIS, FARRELL
& KNUTSON
By: �\
David L. Grannis, III
DLGIII/kd
FILExs 198 0 5
Revised 11/1986
Office of State Aid
MINNESOTA DEPARTMENT OF TRANSPORTATION
AGENCY AGREEMENT
This Agreement made and entered into by and between the
City of Rosemount herein after referred to as
the "City" and the Commissioner of Transportation of the State of
Minnesota hereinafter referred to as the "Commissioner",
WITNESSETH:
WHEREAS, pursuant to M.S. 161.36 the City of
Rosemount desires the Commissioner to act as its agent
in accepting federal aid on the City's behalf, for road and bridge
construction and in contracting for the construction, improvement
or maintenance of roads or bridges financed either in whole or
part with federal moneys: and
WHEREAS, M.S. 161.36, Subdivision 2, requires that the
terms and condition of the agency be set forth in an agreement:
NOW, THEN, IT IS AGREED:
- 1 -
That pursuant to M.S. 161.36, the City does hereby
appoint the Commissioner its agent with respect to all federally
funded projects, to accept and receive all federal funds made
available for said projects and to let contracts pursuant to law
for the construction and improvement of local roads and bridges.
Each contract will be in accordance with plans and
special provisions for said projects on file in the Department of
Transportation, State Transportation Building, St. Paul, Minnesota
Page No. 1
55155, and the latest edition of "Standard Specifications for
Highway Construction" and all amendments thereof, which said
plans, special provisions and specifications are made a part of
this agreement by reference as though fully set forth herein.
In the letting of said contract, it is hereby agreed
that the following procedures shall be followed, to -wit:
(a) The Commissioner shall cause the advertisements
calling for bids on said work to be published in the Construction
Bulletin. He shall also cause advertisements for bids to be
published in the officially designated newspaper of the City.
Said advertisement or call for bids shall specify that sealed
proposals or bids will be received by the City Purchasing Agent on
behalf of the Commissioner as agent of said City. Proposals,
plans and specifications shall be available for the inspection of
prospective bidders at the Department of Transportation, St. Paul,
Minnesota 55155, and at the office of said City Purchasing Agent
and the advertisement shall so state. The bids received in
response to said advertisements for bids shall ,be opened for and
on behalf of the Commissioner by a District Director of the
Department of Transportation or such other engineer of the
Department of Transportation as may be from time to time selected
by the Commissioner. After said bids shallhavebeen opened, the
City Council shall first consider the same and thereupon transmit
to the Commissioner all bids received together with its
recommendation that the lowest bid submitted by a.responsible
bidder be accepted or that all bids be rejected. Upon receipt of
Page No. 2
1987
`�� 05
all said bids, the Commissioner shall duly cause all of said bids
to be tabulated and shall thereupon determine who is the lowest
responsible bidder and shall award the contract to the lowest
responsible bidder or shall reject all bids.
(b) The Commissioner shall supervise and have charge of
the construction of said projects after the same has been let.
The City agrees to furnish its City Engineer or other registered
engineer and.assign him to the active supervision and direction of
the work to be performed under any contract let for the aforesaid
projects. Said engineer so assigned shall act under the
supervision and direction of the Commissioner. The City further
agrees to furnish such other personnel, services, supplies and
equipment as shall be necessary in order to properly supervise and
carry on said work.
(c) The Commissioner may make changes in the plans or
the character of the work as shall be recommended by the engineer
in charge of the work. If he concurs in such recommendations, the
Commissioner may enter into, for and on behalf of the City,
supplemental agreements with the contractor for the performance of
any extra work or work occasioned by any necessary, advantageous,
or desirable change in plans or construction.
It is understood by the City that the Commissioner
cannot personally investigate and pass judgment on the various
items of extra work and plan changes necessary and desirable
during the construction of the projects but that he must delegate
such duties to engineers under his supervision and control that
Page No. 3
• r .
are employed by the Minnesota Department of Transportation. The
City does hereby authorize these engineers, so delegated by the
Commissioner, to enter into, for and on behalf of the City, the
supplemental agreements specified in the preceding paragraph
hereof,
(d) The City hereby authorizes its City Engineer, for
and on behalf of the City, from time to time, during the progress
of the work on said projects, to request the Commissioner to
furnish for use on said projects specific engineering services to
be performed by skilled employees of the Minnesota Department of
Transportation. The Commissioner may but is not obligated to
furnish the services so requested. If the Commissioner in
compliance with such request shall furnish for the use of the City
on said project the services of any Minnesota Department of
Transportation employee, then and in that event, the City agrees
to reimburse the Trunk Highway Fund for the full cost and expense
of the furnishing of such services including all costs and
expenses of any kind or nature whatsoever arising out of,
connected with, or incidental to the furnishing of such services.
(e) The Commissioner shall receive the funds to be paid
by the City and the funds to be paid by the United States as
federal aid funds, for said projects and to pay therefrom when due
any and all sums that may become due the contractor to whom the
contract is awarded, and upon final completion and acceptance of
the work, to pay from said funds the final estimate to said
contractor for said work.
Page No. 4
CUR 'S 1987 05
HLE
(f) The Commissioner shall perform on behalf of the
City all other acts and things necessary to cause said projects to
be completed in a satisfactory manner.
(g) The Commissioner may enter into any agreement for
and on behalf of the City with the United States or any officer or
agent thereof that may be required or necessary for the purpose of
procuring and actually causing to be paid the federal aid funds
available for said projects and to that end to bind and commit the
City in such agreement to the performance of any and all things
required by any law of the United States or of any rule and
regulation issued by federal authority pertaining thereto
necessary for the purpose of procuring and having paid the federal
aid available for said projects.
(h) It is the policy of the United States Department of
Transportation and the Minnesota Department of Transportation that
Disadvantaged Business Enterprises and Women Business Enterprises
as defined in 49 CFR, Part 23, shall have the maximum opportunity
to participate in the performance of contracts financed in whole
or in part with federal funds. Consequently, the requirements of
49 CFR, Part 23, apply to this agreement. In this regard, the
Commissioner and the City shall take all necessary and reasonable
steps in accordance with 49 CFR, Part 23, to insure that
Disadvantaged Business Enterprises and Women Enterprises have the
maximum opportunity to compete for and perform on contracts and
subcontracts. The Commissioner and the City shall not
discriminate on the basis of race, color, national origin, or sex
Page No. 5
in the award and performance of federally funded contracts.
Failure to carry out the above requirements shall constitute a
breach of this agreement andmay result in termination of the
agreement or other such remedy that the Commissioner deems
appropriate.
(i) The Commissioner may perform on behalf of the City
any other and further acts as may be necessary or required under
any law of the United States or of any rule or regulation issued
by proper federal authority in order to cause said projects to be
completed and to obtain and receive the federal aid made available
therefor.
2 -
The City agrees that it will from time to time, after
the execution of this agreement, make such reports, keep such
records and perform such work in such manner and time as the
Commissioner shall from time to time request and direct so as to
enable the Commissioner as its agent to collect for it the federal
aid sought. Said records and reports shall be retained by the
City in accordance with the Commissioner's record_ retention
schedule for federal aid projects.
- 3
It is anticipated that the United States will pay to the
Commissioner as the agent of the City, the federal aid funds
available to said City toward the construction of said projects.
It is further anticipated that the contracts to be let by the
Commissioner as the agent of the City, for the construction of
Page No. 6
tU 1987 05
said projects shall provide that the contractor, as the work ,
progresses, shall, from time to time, be paid partial payments
designated in said contract as partial estimates and on the
completion and acceptance of said work to be paid a final payment
designated in said contract as a final estimate for all work
performed.
The City further agrees that any City funds and/or
Municipal State Aid funds to be applied to any contract covered by
this agreement shall be deposited with the Commissioner in
accordance with Minnesota Rules Chapter 8820.1500 Subp. 3.
At regular monthly intervals after contractors shall
have started work under contracts let by the Commissioner as agent
for the City for the construction of said projects, the engineer
assigned to and in charge of said work shall prepare partial
estimates in accordance with the terms of said contracts let for
said projects and the procedures established by the Office of
Contract Administration and Maintenance, Minnesota Department of
Transportation. The said engineer in charge of said work shall
immediately after preparing each partial estimate, transmit the
same to the Commissioner in duplicate. Each such partial
estimate, shall be certified by the engineer in charge and by the
contractor performing such work. The said engineer assigned to
and in charge of said work',shall also prepare and submit to the
Commissioner the final estimate data, together with the required
project records in accordance with the terms of said contracts let
for said projects. Quantities listed on said partial and final
Page No. 7
estimates shall be documented in accordance with the guidelines
set forth in the applicable documentation manual. After the
approved final estimate has been submitted to the Commissioner,
the City will pay to the Commissioner any additional amount which
together with the federal funds received for that project will be
sufficient to pay all the contract costs of the project
- 4
When the contractor shall have completed the work on
said projects, the City agrees to inspect the same and forthwith
upon the completion of said inspection advise the Commissioner
whether or not the work performed should be, by the Commissioner
as its agent, accepted as being performed in a satisfactory
manner. In the event the City should, after said inspection,
recommend to the Commissioner that he should not accept said work,
then the City shall at the time such recommendation is made
specify in particularity the defects in said work and the reasons
why the work should not be accepted. It is further agreed that
any recommendations made by the City, are not binding on the
Commissioner but that he shall have the right to determine whether
or not the work has been acceptably performed and to accept or
reject the work performed under any said contract.
5 -
It is further agreed that the decision of the
Commissioner on the several matters herein set forth shall be
final, binding and conclusive on the parties hereto.
Page No. 8
aws
- 6 -
It is anticipated that the entire cost of said projects
is to be paid from funds made available by the United States, by
way of federal aid, and by the City. If for any reason the United
States fails to pay any part of the cost or expense of said
projects, then and in that event the City agrees to pay the same.
The City further agrees to 'pay any and all lawful claims or
demands of any kind or nature whatsoever arising out of or
incidental to the performance of the work under any contract let
for said projects in the event that the United States does not pay
the same, and in all events, agrees to save the State of Minnesota
and the Commissioner harmless from said claims and from any claims
arising out of this agreement and to pay any and all expenses and
costs connected with said projects or the construction thereof
which the United States does not pay.
- 7
The City further agrees that:
1) All right-of-way acquisition and relocation will be
conducted in accordance with 49 CFR Part 25. Procedures
implementing their regulation are contained in Mn/DOT State Aid
Manual, Chapter 5-892.310.(Additional guidance may be obtained
by referring to the FHWA's'Real Estate Acquisition Guide for Local
Public Agencies).
2) If the City receives total direct and indirect
federal assistance of:
Page No. 9
A. $100,000 or more per year, the City agrees to
obtain a financial and compliance audit made in accordance with
the Single Audit Act of 1984 (P.L. 98-502) and Office of
Management and Budget (OMB) Circular A-128. The law and circular
provide that the audit shall cover the entire operations of the
City government or, at the option of the City government, it may
cover departments, agencies or establishments that received,
expended, or otherwise administered federal financial assistance
during the year. However, if the City government receives $25,000
or more in General Revenue Sharing Funds in a fiscal year, it
shall have an audit of its entire operations.
B. Between $25,000 and $100,000 per year, the
City agrees to obtain either:
1. a financial and compliance audit made in
accordance with the Single Audit Act of 1984 and OMB Circular
A-128, or
2. a financial and compliance audit of all
federal funds. The audit must determine whether the subrecipient
spent federal assistance funds in accordance with applicable laws-
and regulations and the audit must be made, in accordance with any
federal laws and regulations governing the federal programs the
subrecipient participates in.
Audits shall be made annually unless the state or
local government has, by January 1,1987 a constitutional or
statutory requirement for less frequent audits." For those
governments, the cognizant agency shall permit biennial audits,
Page No. 10
FS 1987 0 5
covering both years, if the government so requests. It shall also
honor requests for biennial audits by governments that have an
administrative policy calling for audits less frequent than
annual, but only for fiscal years beginning before
January 1, 1987.
The audit shall be made by an independent auditor.
An independent auditor is a state or local government auditor or a
public accountant who meets the independence standards specified
in the General Accounting Office's Standards for Audit of
Governmental Organizations, Programs, Activities, and Functions.
The audit report shall state that the audit was
performed in accordance with the provisions of OMB Circular A-128
(or A-110 as applicable).
The audit report shall include:
A. The auditor's report on financial statements
and on a schedule of federal assistance; the financial statements;
and a schedule of federal assistance, showing the total
expenditures for each federal assistance program as identified in
the Catalog of Federal Domestic Assistance. Federal programs or
grants that have not been assigned a catalog number shall be
identified under the caption "other federal assistance".
B. The auditor's report on the study and.
evaluation of internal control systems must identify the
organization's significantinternal accounting controls, and those
controls designed to provide reasonable assurance that federal
programs are being managed in compliance with laws and
Page No. 11
regulations. It must also identify the controls that were
evaluated, the controls that were not evaluated, and the material
weaknesses identified as a result of the evaluation.
C. The auditor's report on compliance containing:
1. a statement of positive assurance with
respect to those items tested for compliance, including compliance
with law and regulations pertaining to financial reports and
claims for advances and reimbursements;
2. negative assurance on those items not
tested;
3. a summary of all instances of
noncompliance;
4. an identification of total amounts
questioned, if any, for each federal assistance awarded, as a
result of noncompliance; and
5. a statement on the status of corrective
action taken on prior findings.
6. refer to the use of the standards
required by the Minnesota Legal Compliance AuditGuidefor Local
Governments, prepared by the Office of the State Auditor. The
purpose of this guide is to establish compliance guidelines for
verification by auditors auditing political subdivisions of the
state.
In addition to the audit report, the recipient
shall provide comments on the findings and recommendations in the
report, including a plan for corrective action taken or planned
Page No. 12
' 1987 05
FILE
and comments on the status of corrective action taken on prior
findings. If corrective action is not necessary, a statement
describing the reason it is not should accompany the audit report.
The City agrees that the grantor, the Legislative
Auditor, and any independent auditor designated by the grantor
shall have such access to grantee's records and financial
statements as may be necessary for the grantor to comply with the
Single Audit Act and OMB Circular A-128.
Required audit reports must be filed with the
Office of the State Auditor, Single Audit Division and state
agencies providing federal assistance, within six months of the
City's fiscal year end. If a federal cognizant audit agency has
been assigned for the City, copies of required audit reports will
be filed with that agency also.
Recipients of more than $100,000 in federal
assistance must also submit one copy of the audit report within 30
days after issuance to the central clearinghouse. Audit reports
should be sent to:
Bureau of Census
Data Preparation Division
1201 East 10th Street
Jeffersonville, Indiana 47132
Attn: Single Audit Clearinghouse
Page No. 13
8 -
All references to statutes and rules ,shall be
construed to refer to the statutes and rules as they may be
amended from year to year.
- 9 -
The Commissioner accepts this said appointment as
agent of the City and agrees to act in accordance herewith.
Page No. 14
CE's 19 8 7FILp 5
CITY OF ROSEMOUNT RECOMMENDED FOR APPROVAL
BY„��
Mayor Director, Office of State Aid
Attest: (;// Date
City erk
611
Date March 3, 1987
APPROVED AS TO FORM AND EXECUTION: STATE OF MINNESOTA
BY
Commissioner of Transportation
DATE DATE
(Seal) (Submit in Duplicate)
Page No. 15
a flit 1987 05
DATE: FEBRUARY 26, 1987
TO: ADMINISTRATOR JILK
FROM: PUBLIC WORKS DIRECIOR H=
RE: MnDDT AGENCY AGREEMENT
I have received a written response from our City Attorney,
Dave Grannis, which I have attached. As you can see frau
Daves' response, the agreement is as we suspected, that being
very one sided towards MnDot.
I would still recommend that Council enter into the Agency
Agreement because I do not feel the four points that Dave
sent us in his letter are that critical. For example, it
would be extremely difficult for either the City or the
Commissioner of Transportation to reject bids if the bid was
submitted by the lowest responsible bidder. As for item #2,
FAU funds do not provide for engineering services. The only
cost FAU covers are for construction only. As for item #3,
any plans and specifications the City would have to prepare
for an FAU job would have to be in accordance with the FAU
guidelines and undoubtedly MnDot guidelines. Also finally,
for the City to find unsatisfactory work, we would have to
have sufficient documentation of defective work or materials.
FAU projects require an inordinate amount of documentation.
Therefore I do not feel this would be a problem either.
If the City should ever wish to use FAU funds on any project
eligible for those funds, then we must have entered into this
agreement to obtain the FAU funds. Although we technically
would not have to enter into this agreement until we have a
PAU project, I would not want to jeopardize future funding
for such a project by waiting.
I will be available at the March 3, 1987 Council meeting to
answer any questions which may arise regarding this
agreement.
MINNESOTA DEPARTMENT OF TRANSPORTATION
FEDERAL AID FORM NO. III
Be it resolved that pursuant to Section 161.36,
Subdivision 1 through 6, Minnesota Statutes, the Commissioner of
Transportation be appointed as agent of the City of Rosemount
to let as its agent, contracts for the construction of local roads
and bridges, and the Mayor and the clerk are hereby authorized and
directed for and on behalf of the City to execute and enter into a
contract with the Commisioner of Transportation prescribing the
terms and conditions of such contracts in the form as set forth
and contained in "Minnesota Department of Transportation Agency
Agreement" a copy of which said agreement was before the Council, -
assuming on behalf of the City all of the obligations therein
contained.
(SEAL)
(Submit in duplicate)
Note: Attach certification by City Clerk with each copy of resolution
Page No. 16