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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.
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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,
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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
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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
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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.
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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
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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
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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
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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
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otherwise participate in any procurement process of the City or to undertake any other
obligations required by procurement laws and regulations of the City.
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COMPANY:
JIMNIST LLC
By: _____________________________
Name: _____________________________
Its: _____________________________
Dated: _____________________________
CITY:
By: _____________________________ By: _____________________________
Name: _____________________________ Name: _____________________________
Its: _____________________________ Its: _____________________________
Dated: _____________________________ Dated: _____________________________
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Approved City Work – “Task 1” only
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