Loading...
HomeMy WebLinkAbout6.t. Pre-Application Escrow Agreement to allow initiation of preliminary design for CSAH 42 & Blaine Avenue Trunk Watermain & Pressure Reduction Valve Relocation\\Rsm-file\Common\City Clerk\Agenda Items\Approved Items\6.t. Pre-Application Escrow Agreement to allow initiation of preliminary design for CSAH 42 & Blaine Avenue Trunk Watermain & Pressure Reduction Valve Relocation.docx EXECUTIVE SUMMARY City Council Regular Meeting: September 20, 2022 AGENDA ITEM: Approve Pre-Application Escrow Agreement to allow initiation of preliminary design for CSAH 42 & Blaine Avenue Trunk Watermain & Pressure Reduction Valve Relocation AGENDA SECTION: Consent PREPARED BY: Nick Egger, PE – Public Works Director AGENDA NO. 6.t. ATTACHMENTS: Pre-Application Escrow Agreement APPROVED BY: LJM RECOMMENDED ACTION: Motion to Approve City Entry into Pre-Application Escrow Agreement BACKGROUND The City has been in discussion with several prospective development entities for large-scale light industrial/business park projects along the section of County State Aid Highway 42 (CSAH 42) between Akron Avenue and US Highway 52 over the last year. It is evident from discussing with these parties that water demand for the types of projects they would be proposing will require the City to evaluate, design, and possibly to construct watermain system improvements on an accelerated timeline compared to when the City otherwise would have advanced such infrastructure improvements to the area. One of the parties considering locating on the corridor desires the City to commence the evaluation and design stage components at this time such that construction of the infrastructure could precede their own project and service could be available at the time their project comes online. However, this party is not yet certain they will locate in Rosemount and to date they have not turned in a development application. To advance the work, the City and the prospective developer would enter into the attached agreement which would require the prospective developer to provide an escrow deposit with the City strictly set aside for covering third-party consultant engineering costs associated with performing preliminary and final design for extending watermain facilities in the CSAH 42 corridor. The deposit amount would be $180,000, and the account would be drawn upon as the preliminary and final design work progresses. Any funds spent at this time would ultimately be credited back to the prospective developer’s trunk watermain fee charge at such time that they decide to locate in Rosemount and sign a subdivision agreement with the City. If the prospective developer were to walk away from the project, the City would not be required to refund any funds spent. Both staff and the City Attorney have reviewed the agreement and are comfortable with the language. RECOMMENDATION Staff recommends City Council approve the attached Pre-Application Escrow Agreement and authorize the Mayor and City Clerk to enter into this agreement. 74147207v6 1 CITY OF ROSEMOUNT PRE-APPLICATION ESCROW AGREEMENT This City of Rosemount Pre-Application Escrow Agreement (“Agreement”) is entered into as of the date indicated below by and between the City of Rosemount, a Minnesota municipal corporation (the “City”), and Jimnist LLC, a Delaware limited liability company (the “Company”). The parties hereto have entered into this Agreement effective as of the date of the last signature set forth below (“Effective Date”). Recitals A. The Company is considering a project (the “Project”) that will require the submission of one or more applications to the City pursuant to the Rosemount City Code, including, without limitation, applications for site plan, rezoning, and preliminary and final plat (subdivision) (collectively, the “Applications”). B. To prepare the City for the review and evaluation of such Applications, the City desires to undertake certain watermain design work and in the future may want to do additional work approved by the Company pursuant to Section 4 (collectively, the “City Work”) for which the City will incur costs (“City Work Costs”). C. In order to facilitate the expediency of the City Work and rather than requiring the Company to submit Applications and associated escrows immediately, the parties desire to enter into this Agreement to provide for a pre-application process whereby the City and the Company agree on: (1) the City Work; (2) the Company’s maximum contribution towards the City Work Costs and deposit of such contribution in an account, and (3) a process for the City to draw from such account, all in accordance with the terms of this Agreement. Agreement The parties to this Agreement hereby agree as follows: 1. Approved City Work. The Company hereby approves the work identified as “Task 1” in the proposal for Professional Design Services for CSAH 42 Trunk Watermain Extension from Short Elliott Hendrickson (SEH), Inc. to the City dated May 26, 2022 attached hereto as Exhibit A (“Approved City Work”). 2. Approved City Work Costs. The Company agrees to reimburse the City for actual costs incurred by the City for the Approved City Work up to a maximum of $180,000 (“Approved City Work Costs”), subject to the terms of this Agreement. The Company shall not be liable for the cost of any City Work that is not Approved City Work or that exceeds the Approved City Work Costs. 3. Approved City Work Costs Escrow. To secure the payment of the Approved City Work Costs, the Company shall, within ten Business Days after the Effective Date, remit payment to the City in the amount of $180,000. The funds are to be held by the City in escrow in a separate interest-bearing account with Merchants Bank, 15055 Chippendale Avenue W, Rosemount, 74147207v6 2 MN 55068 (together with the interest accrued thereon, the “Escrow”). Any cost for the interest bearing account shall be at the City’s cost. Within three Business Days after receipt thereof, the City will deposit such $180,000 in the Escrow and shall withdraw funds from it as needed to reimburse itself for actual Approved City Work Costs. Once a month, not later than the 5th of each month, the City shall provide the Company with a current accounting of the Escrow as of the last day of the prior month showing all draws, and including copies of all invoices, proof of payments, work task summaries pursuant to said draws, and any other reasonable information regarding the Escrow requested by Company. In no event shall the Company’s liability for Approved City Work exceed the amount in Escrow. 4. Additional Approved City Work and Approved City Work Costs. The City and the Company may agree on additional Approved City Work and Approved City Work Costs. To do so, the City shall provide the Company with the documentation Company deems necessary to determine whether to approve the additional City Work and City Work Costs (“Additional City Work Proposal”), which shall include, at a minimum, a description of the company, proposed services, the project team, project schedule, total costs, how such costs were calculated, how much of such costs the City is requesting to add to the Approved City Work Costs, and the City fees that such costs will offset. The Company shall have fifteen (15) days following the Company’s receipt of all required supporting documentation to either approve, reject, or provide comments on the Additional City Work Proposal. If the Company does not timely respond to the request for approval, the Company will be deemed to have rejected the Additional City Work Proposal. If the Company provides comments, the City shall incorporate the comments into the documents within ten (10) days of receiving the comments and then present the revised Additional City Work Proposal to the Company and the process for approval set forth above shall continue until the Company has accepted or rejected the Additional City Work Proposal in writing via e-mail or deemed rejected by failure to timely respond. If the Company accepts the Additional City Work Proposal, every reference in this Agreement to “Approved City Work” and “Approved City Work Costs” shall be amended to include the additional City Work and the increase in Approved City Work Costs approved in the Additional City Work Proposal, provided, however, such amendment shall only be effective when the Company deposits the increased Approved City Work Costs into Escrow. Each item of Approved City Work shall have a maximum Approved City Work Cost associated with it. The City may not use amounts approved by the Company for one item of Approved City Work on a different item of Approved City Work. 5. Schedule. The City shall, and shall cause the City’s consultants and contractors to, proceed with the City Work (i) in accordance with the schedules in the approved City Work documents; (ii) in such a manner as to maintain harmonious labor relations and as not to interfere with or delay any work on the Project to be performed by the Company or the Company’s consultants or contractors; (iii) in such a manner that the Company and the Company’s consultants and contractors shall have reasonable vehicular and pedestrian access to the property where the Project will be located (the “Property”) via public rights of way or any easements of record at all times; (iv) in accordance with this Agreement; and (v) in accordance with all applicable existing laws, rules, regulations, ordinances and orders (collectively, “Applicable Laws”). The City shall, and shall cause the City’s consultants and contractors to, act in a commercially reasonable manner and endeavor in good faith to ensure the timely progression of the City Work. The City shall deliver to the Company regular updates (not less than monthly or more 74147207v6 3 often upon request of the Company) regarding the progress of and schedule for completion of the City Work. 6. Return of Escrow. At any time and for any reason, the Company may notify the City by written notice that the Company no longer wants the City to pursue the City Work for the Project. Any costs incurred by the City after receipt of such notice shall be at the City’s sole cost, except to the extent that the contract for the City Approved Work does not allow the City to stop incurring costs for the City Approved Work and in such event, the Company will be liable for the amounts the City has a continuing obligation to pay, up to the Approved City Work Costs amount. Once the Company submits an application to the City for the Project or indicates in writing that it will not be pursuing the Project and requests a return of the remaining Escrow, the City shall return any remaining portion of the Escrow to the Company, without interest, within 30 days after the date that the Company submits such application or indicates in writing that it will not pursue the Project, as applicable. The Company understands that the consultants’ billing cycle may result in a bill not being received, processed, and paid by the City for up to two months or more after the work was performed. 7. Term. The term of this Agreement (the “Term”) shall commence on the Effective Date and continue until terminated in accordance herewith. Company may at any time and for any reason terminate this Agreement automatically upon 30 days advanced written notice thereof to the City. 8. Offset of Future Escrow Obligations and City Fees. The remaining amount of the Escrow shall be applied to any escrow or deposit the Company may be required to provide at the time of submitting an application. The amount the Company pays for the Approved City Work Costs shall be a credit to the Company against the City Trunk Water Area fee for the development of the Project. 9. No Right to Access. City acknowledges that, as of the Effective Date, Company does not own the Property. Company does not have the authority to, and is not, granting the City access to the Property through this Agreement. To the extent the City needs access to the Property, the City will need to obtain consent from the owner of the Property. 10. Default. a. Generally. In the event of a default of this Agreement, the non-defaulting Party shall provide written notice of the default to the defaulting Party and shall specify a period of not less than fifteen (15) days during which the defaulting Party shall have the right to cure such default; provided, however, that such cure period may be extended if (i) the default cannot reasonably be cured within the cure period provided in such notice, (ii) the curing Party notifies the non-defaulting Party of such fact by no later than the end of the cure period provided in the notice, (iii) the curing Party has theretofore been diligent in pursuing the cure and (iv) the curing Party in such extension notice covenants to (and thereafter actually does) diligently pursue the cure to completion. If the defaulting Party fails to cure the default, the non-defaulting Party may either (a) terminate this Agreement and seek damages from the defaulting Party or (b) enforce this Agreement by the remedy of damages or specific performance or both. The Company may immediately terminate 74147207v6 4 this Agreement if the City is in breach of its undertakings under Section 11(r) (Anti- Corruption Compliance) and will have no obligation to allow further draws with respect to any transaction associated with the breach of the Agreement by the City. b. Waiver of Assessments. The City shall not assess all or any portion of the Property or any other Property owned by the Company in the State (defined below) for the City Work Costs. This waiver applies only to the work governed by this Agreement and does not negate the City’s ability to assess benefitting properties for future infrastructure and improvements nor does this Agreement negate the Company’s ability to challenge such future assessments in accordance with Applicable Laws. c. Mutual Waiver of Consequential Damages. Except in the case of gross negligence, bad faith or willful misconduct, for which claims for consequential damages are expressly reserved by the Parties, each Party hereby waives all claims against the other Party for any consequential or indirect damages that may arise out of or relate to this Agreement. 11. Miscellaneous. a. Recitals. The recitals of this Agreement are material terms hereof and shall be binding upon the Parties. b. No Obligation. The City desires to promote and facilitate projects that are proposed in a way consistent with its City Code and associated land use controls; however, the City entering into this Agreement does not obligate it to agree to any proposals or land use requests which the Company may submit to the City, whether related to the Project or otherwise. Any such proposals and requests will need to be processed and acted on in accordance with the City’s established procedures. c. No Joint Venture. Nothing herein constitutes the creation of a joint venture or joint undertaking between the City and the Company. This Agreement is simply providing a means for reimbursing the City the Approved City Work Costs incurred related to Project just as if the Company had formally submitted an application to the City. Furthermore, nothing herein shall constitute, or be construed as constituting, a waiver of any limitation on, or exemption from, liability available to the City under Minn. Stat. Chap. 466 or other law. d. Notice. All notices and other communications given pursuant to this Agreement shall be in writing and shall be (a) mailed by first class, United States mail, postage prepaid, certified, with return receipt requested, and addressed to the parties hereto at the address listed below, (b) hand delivered to the intended addressee, (c) sent by nationally recognized overnight courier, or (d) or by electronic mail. If notice is given by U.S. Certified Mail, then the notice shall be deemed to have been given on the second Business Day after the date the envelope containing the notice is deposited in the U.S. Mail, properly addressed to the party to whom it is directed, postage prepaid. Notice made by personal delivery, overnight delivery or electronic mail shall be deemed given when received. The parties hereto may change their addresses by giving notice thereof to the other in conformity with this provision. 74147207v6 5 City: City of Rosemount Attn: Logan Martin 2875 145th Street W Rosemount, MN 55068 Email: logan.martin@rosemountmn.gov nick.egger@rosemountmn.gov mtietjen@kennedy-graven.com Company: Taft Stettinius & Hollister LLP Attn: Thomas Bray 2200 IDS Center 80 South 8th Street Minneapolis, MN 55402-2157 Email: tbray@taftlaw.com bmaershbecker@taftlaw.com Ken@bigfootdevelopmentservices.com e. Assignment. The Company may assign its rights and obligations under this Agreement to any (i) affiliate controlling, controlled by or under common control with the Company (and upon such assignment the assigning entity shall be relieved of its covenants, commitments and obligations hereunder) or (ii) owner of all or any portion of the Property. If the Company sells the Property in its entirety and assigns its rights and obligations hereunder to its successor in title to the Property, then the Company shall be relieved of all of its covenants, commitments and obligations hereunder. The City shall not have the right to assign its rights and obligations under this Agreement to any party. f. Entire Agreement. This Agreement contains the entire agreement between the Parties regarding the subject matter hereof, and all prior or contemporaneous communications or agreements between the Parties or their respective representatives with respect to the subject matter herein, whether oral or written, are merged into this Agreement and extinguished. No agreement, representation or inducement shall be effective to change, modify or terminate this Agreement, in whole or in part, unless in writing and signed by the Party or Parties to be bound by such change, modification or termination except as set forth in Section 4. g. Severability. If any term or provision of this Agreement or any application thereof shall be unenforceable, the remainder of this Agreement and any other application of any such term or provision shall not be affected thereby, and each provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law. h. Document Mutually Negotiated. The Parties acknowledge and agree that this Agreement represents a negotiated agreement, having been drafted, negotiated, and agreed upon by the Parties and their respective legal counsel. Therefore, the Parties agree that the fact that one Party or the other Party may have been primarily responsible for drafting or editing this Agreement shall not, in any dispute over the terms of this Agreement, cause this Agreement to be interpreted against such Party. It is the Parties’ collective intention to 74147207v6 6 encourage, promote and aid the Project so that the opportunities and positive community impacts of the Project are fully realized by the City, its citizens and the Company. i. Waivers. Neither Party may waive any condition or breach of any representation, term, covenant or condition of this Agreement, except in a writing signed by the waiving Party and specifically describing the condition or breach waived. The waiver by either Party of any condition or breach of any representation, term, condition or covenant contained in this Agreement shall not be deemed to be a waiver of any other representation, term, condition or covenant or of any subsequent breach of the same or of any other representation, term, condition or covenant of this Agreement. j. Governing Law. This Agreement is governed by and shall be construed in accordance with the laws of the State of Minnesota (“State”). k. Interpretation. The section headings of this Agreement are for convenience of reference only and shall not be deemed to modify, explain, restrict, alter or affect the meaning or interpretation of any provision hereof. Whenever the singular number is used, and when required by the context, the same includes the plural, and the masculine gender includes the feminine and neuter genders. All references herein to “Section” or “Exhibit” reference the applicable Section of this Agreement or Exhibit attached hereto; and all Exhibits attached hereto are incorporated herein and made a part hereof to the same extent as if they were included in the body of this Agreement. The use in this Agreement of the words “including”, “such as” or words of similar import when used with reference to any general term, statement or matter shall not be construed to limit such term, statement or matter to the specific terms, statements or matters, unless language of limitation, such as “and limited to” or words of similar import are used with reference thereto. Rather, such terms shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such term, statement or matter. l. Counterparts. This Agreement may be executed in as many counterparts as may be deemed necessary and convenient, and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same instrument. A scanned or photocopy signature on this Agreement, any amendment hereto, or any notice delivered hereunder will have the same legal effect as an original signature. The parties hereto consent and agree that this Agreement may be signed and/or transmitted by e-mail of a .pdf document or using electronic signature technology (e.g., via DocuSign or similar electronic signature technology), and that such signed electronic record shall be valid and as effective to bind the party so signing as a paper copy bearing such party’s hand-written signature. The parties further consent and agree that (a) to the extent a party signs this Agreement using electronic signature technology, by clicking “sign”, such party is signing this Agreement electronically and (b) the electronic signatures appearing on this Agreement shall be treated, for purposes of validity, enforceability, and admissibility, the same as hand- written signatures m. Business Days. As used herein, the term “Business Day” shall mean a day that is not a Saturday, Sunday or legal holiday in the State. In the event that the date for the 74147207v6 7 performance of any covenant or obligation under this Agreement shall fall on a Saturday, Sunday or legal holiday under the laws of the State, the date for performance thereof shall be extended to the next Business Day. n. Effect on Other Vested Rights. This Agreement does not abrogate any rights established or preserved by any Applicable Laws or by any other agreement or contract executed by the City and the Company in connection with the Project or that have vested or may vest pursuant to common law or otherwise. o. Confidential Information. The Company may designate any trade secrets or confidential business information included in any report or other writing delivered to the City pursuant to or in connection with this Agreement by any method intended to clearly set apart the specific material that the Company claims to be either its trade secrets or confidential business information that, if released, would give an advantage to competitors or result in unfair competitive injury to the Company (such information, collectively, “Confidential Business Information”). For the avoidance of doubt, all building plans shall be deemed Confidential Business Information. The City shall redact or delete any Confidential Business Information from any records it makes available for inspection or of which it provides copies. Within two (2) Business Days following the City’s receipt of any request to inspect or obtain copies of public records relating to this Agreement or the Project, the City shall provide written notice of the same to the Company, which notice shall include a copy of such request. The City shall not allow inspection or provide copies of any such records until the Company shall have had not less than ten (10) Business Days (following and excluding the day on which the Company receives such notice) to determine whether to contest the right of any party to inspect or receive copies of such records. Any such action to enjoin the release of Confidential Business Information may be brought in the name of the Company or the City. The costs, damages, if any, and attorneys’ fees in any proceeding commenced by the Company or at its request by the City to prevent or enjoin the release of Confidential Business Information in any public records relating to this Agreement or the Project shall be borne by the Company. Notwithstanding the above, Company acknowledges that the City is subject to the Minnesota Government Data Practices Act (the Act), Minnesota Statutes, Chapter 13 and must comply with the Act to the extent this Agreement is inconsistent with the Act. p. Attorneys’ Fees. If any action is brought by either Party against the other Party, relating to or arising out of this Agreement or the enforcement hereof, the prevailing Party shall be entitled to recover from the other Party the reasonable attorneys’ fees, costs and expenses incurred in connection with the prosecution or defense of such action, including the costs and fees incurred in connection with the enforcement or collection of any judgment obtained in any such proceeding. The provisions of this Section shall survive the termination of this Agreement and the entry of any judgment and shall not merge, or be deemed to have merged, into any judgment. q. Waiver of Jury Trial. EACH PARTY HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (I) ARISING UNDER THIS AGREEMENT OR (II) IN ANY WAY CONNECTED WITH OR RELATED OR 74147207v6 8 INCIDENTAL TO THIS AGREEMENT OR ANY OF THE TRANSACTIONS RELATED HERETO. EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY A COURT TRIAL WITHOUT A JURY AND THAT EITHER PARTY MAY FILE A COPY OF THIS AGREEMENT WITH ANY COURT AS EVIDENCE OF SUCH WAIVER. r. Anti-Corruption Compliance. In connection with the negotiation and performance of this Agreement, the City, on behalf of itself and its agents and representatives, represents, warrants, and covenants that it has complied with and that it has not engaged in and will refrain from offering, promising, paying, giving, authorizing the paying or giving of, soliciting, or accepting or agreeing to accept Anything of Value, directly or indirectly to or from (a) any Government Official to (i) influence any act or decision of a Government Official in their official capacity, (ii) induce a Government Official to use their influence with a Government Authority, or (iii) otherwise secure any improper advantage; or (b) any person or entity in any manner that would constitute bribery or an illegal kickback, or would otherwise violate any applicable anti-corruption law, rule, or regulation. “Anything of Value” includes, but is not limited to, money, cash or a cash equivalent (including “grease”, “expediting” or facilitation payments), discounts, rebates, gifts, meals, entertainment, hospitality, charitable contributions, sponsorships, use of materials, facilities or equipment, transportation, lodging, or promise of employment. “Government Authority” means any multinational, national, regional, or local government, governmental or public department, court, commission, board, bureau, agency, ministry, university, political party, or other governmental instrumentality, public international organization, or subdivision, agent, commission, board, or authority of any of the foregoing. “Government Official” means any official or employee (or relative or household member thereof), or agent of a Government Authority; members of royal families; or candidates for political office. If the City becomes aware of any violation or suspected violation of this Section 11(r) (Anti-Corruption Compliance), it must provide prompt written notice to the Company and set forth the relevant facts and circumstances. The City will, consistent with applicable laws, cooperate with the Company in good faith to review any suspected violations of this Section 11(r) (Anti-Corruption Compliance), including by providing reasonable access to relevant documentation. s. Books & Records. The City will keep and maintain complete and accurate records in connection with its performance under this Agreement and all fees and expenses charged to the Company and will retain these records for at least seven (7) years from their date of creation or for such period as may be required under applicable laws. For clarity, this provision survives the termination of the Agreement. t. Ethical Business Practices; No Procurement Process. In connection with the negotiation and performance of this Agreement, the City represents and warrants that it has complied and covenants that it shall comply with all rules, regulations, ordinances and official policies of the City in force and effect as of the Effective Date and Applicable Laws, including without limitation anti-corruption laws, rules, and regulations, and that it has used and shall use only legitimate and ethical business practices. The performance of any obligations under this Agreement does not require the Company to submit any bid or 74147207v6 9 otherwise participate in any procurement process of the City or to undertake any other obligations required by procurement laws and regulations of the City. 74147207v6 10 COMPANY: JIMNIST LLC By: _____________________________ Name: _____________________________ Its: _____________________________ Dated: _____________________________ CITY: By: _____________________________ By: _____________________________ Name: _____________________________ Name: _____________________________ Its: _____________________________ Its: _____________________________ Dated: _____________________________ Dated: _____________________________ 74147207v6 A-1 Exhibit A Approved City Work – “Task 1” only 74147207v6 A-2 74147207v6 A-3 74147207v6 A-4 74147207v6 A-5 74147207v6 A-6 74147207v6 A-7 74147207v6 A-8 74147207v6 A-9 74147207v6 A-10 74147207v6 A-11 74147207v6 A-12 74147207v6 A-13 74147207v6 A-14 74147207v6 A-15 74147207v6 A-16 74147207v6 A-17