HomeMy WebLinkAboutIX-01 Authorize Signature - Minnesota Pollution Control Agency Grant Agreement – Central Water Treatment PlantCity Council Memorandum
To: Mayor Fasbender & City Council Members
From: Ryan Stempski – Public Works Director
Date: August 8, 2025
Item: Authorize Signature of the Minnesota Pollution Contral Agency Grant Agreement for the Central Water
Treatment Plant (1290 North Frontage Road)
COUNCIL ACTION REQUESTED
Enclosed for City Council consideration is the MPCA Grant Agreement for the Central Water Treatment Plant
(Water Treatment Plant #2 Project).
BACKGROUND INFORMATION
The Central Water Treatment Plant (WTP) is designed to remove PFAS from Well 3, 5, and 7. The City qualifies
for funding from the East Metro 3M Settlement Funds to remove PFAS from Well 5. To obtain funds from the
settlement, the MPCA administers Grant Agreements for eligible expenses. This Grant Agreement secures funds
eligible for the removal of PFAS from Well 5. If Well 3 and 7 become Settlement-eligible, the Grant Agreement
may be amended to account for those costs deemed eligible.
FINANCIAL IMPACTS
The MPCA will reimburse 59% of each construction invoice for the Central WTP Project. It also includes
approximately 90% reimbursement of the construction services to support the project. The total obligation of the
Grant Agreement will not exceed $13,686,726.26, unless amended. Eligible expenses have been determined by
cost estimates that were based on constructing a WTP to strictly address removal of PFAS from Well 5 and
applying the percentage to the cost of the WTP that includes Well 3 and 7. The area of the WTP built out to
address Nitrate removal in the future was also excluded from eligibility.
STAFF RECOMMENDATION
Staff recommends the City Council approve the MPCA Grant Agreement for the Central Water Treatment Plant
located at 1290 North Frontage Road.
ATTACHMENTS
·MPCA Grant Agreement for the Central Water Treatment Plant
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Grant Agreement
State of Minnesota
Doc Type: Contract/Grant
SWIFT Contract Number:
Agency Interest ID:190096
Activity ID:PRO20250001
This Grant Agreement is between the state of Minnesota, acting through its Commissioner of the Minnesota Pollution
Control Agency, 520 Lafayette Road North, St. Paul, MN 55155-4194 (“MPCA” or “State”), and City of Hastings, 101 4th
Street East, Hastings, MN 55033 ("Grantee" or “City”).
Recitals
1.Under Minn. Stat. § 116.03, subd. 2, the State is empowered to enter into this grant.
2.The City is authorized to enter into this grant under Minn. Stat. § 412.211.
3.The State and City are in need of the Water Treatment Plant #2 Project (“Project”) to be located at 1290 N.
Frontage Road, Hastings, Minnesota.
4.Hastings’ municipal wells are impacted by Poly- and Perfluoroalkyl Substances (PFAS). The 3M Settlement
(Settlement) Co-Trustees determined that treatment for Hastings’ municipal well number 5 (Well # 5) is a
Settlement-eligible expense. Treatment for the other municipal wells are not Settlement-eligible at this time but
may become Settlement-eligible in the future.
5.Grantee will comply with required grants management policies and procedures set forth through Minn. Stat. §
16B.97, subd. 4(a)(1).
6.The Grantee represents that it is duly qualified and agrees to perform all services described in this grant agreement
to the satisfaction of the State. Pursuant to Minn. Stat. § 16B.98, subd. 1, the Grantee agrees to minimize
administrative costs as a condition of this grant.
Grant Agreement
1.Term of Grant Agreement
1.1 Effective date: July 28, 2025, Per Minn. Stat. § 16B.98, subd. 5, the Grantee must not begin work until this
Grant Agreement is fully executed and the State's Authorized Representative has notified the Grantee that
work may commence. Per Minn. Stat. § 16B.98 subd. 7, no payments will be made to the Grantee until this
Grant Agreement is fully executed.
1.2 Expiration date: June 30, 2030, or until all obligations under this Grant Agreement have been satisfactorily
fulfilled as agreed upon by the State and Grantee, whichever occurs first.
1.3 Survival of terms. The following clauses survive the expiration or cancellation of this Grant Agreement:
Indemnification; State Audits; Government Data Practices and Intellectual Property; Publicity and
Endorsement; Governing Law, Jurisdiction, and Venue; and Data Disclosure.
2.Grantee’s Duties
This Project includes construction of City of Hastings Water Treatment Plant Number 2 (WTP #2) with PFAS
treatment for Hastings municipal wells 3, 5, and 7. At this time, the State has determined that treatment for Well #5
is Settlement-eligible and 3M Settlement Co-Trustees determined that 59% of the WTP #2 construction costs are
Settlement-eligible. The City will construct the WTP #2’s capacity and features in a way that is consistent with
documented attributes agreed upon by City and State.
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CONTROL AGENCY
3.Time
The Grantee must comply with all the time requirements described in this Grant Agreement. In the performance of
this Grant Agreement, time is of the essence.
4.Consideration and Payment
4.1 Consideration. The State will pay for all services performed by the Grantee under this Grant Agreement as
follows:
(a)Compensation. The MPCA will reimburse the Grantee according to approved invoices relating to the
duties listed in Clause 2. The MPCA will reimburse 59% (Fifty-Nine Percent) of each invoice, which is the
average of the percentages of detailed line-item costs that are attributed to Well 5. Eligible expenses have
been determined by cost estimates that were based on constructing a water treatment plant to strictly
address removal of PFAS from Well #5 and applying the percentage to the cost of the WTP #2 that
includes Wells 3 and 7. The remaining cost for the WTP #2 that includes Wells 3 and 7 is not currently
Settlement-eligible, though may become Settlement-eligible at a later time as determined by the Co-
Trustees. The MPCA will review the expense documentation submitted by the Grantee for the costs and
will reimburse the Grantee for reasonable and necessary expenditures, as determined by the MPCA. Items
that are determined ineligible will not be reimbursed. Other than as may be agreed upon for treatment of
wells 3 and 7, currently only costs associated with Well #5 are eligible for reimbursement; if other
municipal wells are determined to be eligible by the 3M Settlement Co-Trustees, this Grant Agreement
may be amended to account for those costs deemed eligible for reimbursement under the Settlement.
(b)Travel expenses. Reimbursement for travel and subsistence expenses actually and necessarily incurred by
the Grantee as a result of this Grant Agreement will be provided to meet the duties listed in Clause 2.
Grantee will be reimbursed for travel and subsistence expenses in the same manner and in no greater
amount than provided in the current "Commissioner’s Plan” promulgated by the Commissioner of
Minnesota Management and Budget (“MMB”). The Grantee will not be reimbursed for travel and
subsistence expenses incurred outside Minnesota unless it has received the State’s prior written approval
for out of state travel. For the purposes of this subdivision, Minnesota will be considered the home state
for determining whether travel is out of state.
(c)Total obligation. The total obligation of the State for all compensation and reimbursements to the
Grantee under this grant agreement will not exceed $13,686,726.26 (Thirteen Million Six Hundred Eighty-
Six Thousand Seven Hundred Twenty-Six Dollars and Twenty-Six Cents) unless amended pursuant to
Section 7.2 of this Agreement. The total obligation includes $1,611,494.00 (One Million Six Hundred
Eleven Thousand Four Hundred Ninety-Four Dollars and Zero Cents) for contingency costs. The Grantee
must submit a request in writing to the MPCA for approval prior to using the contingency funds.
4.2 Payment
(a)Invoices. The State will promptly pay the Grantee after the Grantee presents an itemized invoice and
other documentation, including closing statements, for the services actually performed and the State’s
Authorized Representative accepts the services. Invoices must be submitted timely and according to the
following schedule: monthly or at least quarterly.
Invoices must be emailed to mpca.ap@state.mn.us, and contain the following information:
·Name of Grantee
·Grantee project manager
·Grant amount
·Invoice number
·Invoice date
·MPCA project manager
·SWIFT Contract No.
·Invoicing period (actual working period)
·Copies of paid in full receipts
·Prevailing Wage documentation (if applicable)
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·Other items as requested
If there is a problem with submitting an invoice electronically, please contact the Accounts Payable Unit at
651-757-2491.
The Grantee shall submit an invoice for the final payment upon submittal of the final progress and
financial report within fifteen (15) days of the original or amended end date of this Grant Agreement. The
State reserves the right to review submitted invoices after fifteen (15) days and make a determination as
to payment.
(b)Unexpended Funds. The Grantee must promptly return to the State any unexpended funds that have not
been accounted for annually in a financial report to the State due at grant closeout.
4.3 Contracting and Bidding Requirements
Per Minn. Stat. § 471.345, grantees that are municipalities as defined in Minn. Stat. § 471.345, subd. 1, must
follow the Uniform Municipal Contracting Law.
(a)For projects that include construction work and have a total project cost of $25,000 or more, prevailing
wage rules apply per Minn. Stat. § 177.41 through 177.44. These rules require that the wages of laborers
and workers on projects financed in whole or in part by state funds should be comparable to wages paid
for similar work in the community as a whole.
(b)Grantee must not contract with vendors who are suspended or debarred in Minnesota according to the
Office of State Procurement’s master list: https://mn.gov/admin/osp/government/suspended-
debarred/index2.jsp
4.4 Prevailing Wage
Pursuant to Minn. Stat. § 177.41 through 177.44 and the corresponding Minnesota Administrative Rules, Part
5200.1000 through 5200.1120, this Grant Agreement is subject to the prevailing wages as established by the
Minnesota Department of Labor and Industry. Specifically, all contractors and subcontractors must pay all
laborers and mechanics the established prevailing wages for work performed under this Grant Agreement.
Failure to comply with the prevailing wage requirements as established by this Grant Agreement may result in
civil or criminal penalties. Rates are listed in Attachment A.
In compliance with Minn. Stat. § 177.43, subd. 3 and § 177.44, subd. 5, the wages of laborers, workers, and
the mechanics on projects financed in whole or part by state funds should be comparable to wages paid for
similar work in the community as a whole. Project includes erection, construction, remodeling, or repairing of
a public building or other public work financed in whole or part by state funds.
Any work on real property which uses the skill sets of any trades covered by Labor Code and Class under
prevailing wages is construction and requires prevailing wages. See
http://www.dli.mn.gov/business/employment-practices/prevailing-wage-information for a list of affected
trades.
The contractor shall pay prevailing wages to its employees when conducting construction activities under this
agreement.
Applicability. In accordance with Minn. Stat. § 177.43, subd. 7, the prevailing wage requirements do not apply
to an agreement or work under an agreement, under which:
A. the estimated total cost of completing the project is less than $2,500 and only one trade or occupation
is required to complete the work; or
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B. the estimated total cost of completing the project is less than $25,000 and more than one trade or
occupation is required to complete it.
Choose from Commercial, Highway/Heavy, or Residential Wage Rates:
The prevailing wage rate requirements are attached as Attachment A.
Prevailing Wage Payroll Information:
In accordance with Minn. Stat. § 177.30, subd. 4 and § 177.43, subd. 3, Contractor and/or subcontractor shall
furnish to the Contracting Authority and the Project Owner:
• All payrolls, of all workers on the project, a certified payroll report via e-mail as attachments, a State of
Minnesota Prevailing Wage Payroll Report as a Microsoft Excel file and Statement of Compliance Form
as a PDF file to the appropriate e-mail addresses: prevailingwage.pca@state.mn.us and the MPCA
Authorized Representative.
• The subject line on the Contractor’s or Subcontractor’s e-mail must give their firm’s name and the
Contract or Purchase Order Number.
• These completed forms must be furnished not more than fourteen (14) days after the end of each pay
period.
• The State of Minnesota Prevailing Wage Payroll Report and Statement of Compliance Form are available
on the MMD website at https://www.dli.mn.gov/sites/default/files/pdf/pw_certified_payroll_form.pdf.
Submit the completed and signed State of Minnesota Prevailing Wage Payroll Report as a Microsoft
Excel file and the Statement of Compliance Form as a PDF file, no other payroll forms will be accepted to
meet this requirement.
The prevailing wage payroll information forms that are submitted shall be maintained by the contracting
agency for a minimum of three (3) years after final payment has been made on the Project. All of the data
provided on the Prevailing Wage Payroll Information Form will be public data, which is available to anyone
upon request.
Refer vendor questions regarding the Prevailing Wage Laws to the Department of Labor and Industry at 651-
284-5091 or visit the website for Labor Standards Section, Prevailing Wage
http://www.dli.mn.gov/business/employment-practices/prevailing-wage-information.
All construction work needs an IC-134 form submitted by the contractor before payment can be made. The
contractor can find a copy of the IC-134 online at the Minnesota Department of Revenue website at
https://www.revenue.state.mn.us/construction-contracts-state-or-local-government-agencies.
4.5 Reporting Requirements
The Grantee shall submit to the State quarterly status reports, based on the effective date of this Grant
Agreement.
5.Conditions of Payment
All services provided by the Grantee under this Grant Agreement must be performed to the State’s satisfaction, as
determined at the sole discretion of the State’s Authorized Representative/MPCA’s Project Manager and in
accordance with all applicable federal, state, and local laws, ordinances, rules, and regulations. The Grantee will not
receive payment for work found by the State to be unsatisfactory or performed in violation of federal, state, or local
law.
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6.Authorized Representative
The State's Authorized Representative/Project Manager is Andri Dahlmeier, 520 Lafayette Road, St. Paul, MN 55155,
651-757-2718, andri.dahlmeier@state.mn.us, or their successor, has the authority to monitor the Grantee’s
performance and accept the services provided under this Grant Agreement. If the services are satisfactory, the
MPCA’s Project Manager will certify acceptance of each invoice submitted for payment. If the State’s Authorized
Representative changes at any time during this Grant Agreement, the State must immediately notify the Grantee.
The Grantee’s Authorized Representative is Ryan Stempski, 101 4th Street East, Hastings, MN 55033, 651-480-2368,
rstempski@hastingsmn.gov, or their successor. If the Grantee’s Authorized Representative changes at any time
during this Grant Agreement, the Grantee must immediately notify the State.
7.Assignment, Amendments, Change Orders, Waiver, and Grant Agreement Complete
7.1 Assignment. The Grantee shall neither assign nor transfer any rights or obligations under this Grant
Agreement without the prior written consent of the State, approved by the same parties who executed and
approved this Grant Agreement, or their successors in office.
7.2 Amendments. Any amendments to this Grant Agreement must be in writing and will not be effective until it
has been executed and approved by the same parties who executed and approved the original Grant
Agreement, or their successors in office.
7.3 Change orders. If the State's Project Manager or the Grantee’s Authorized Representative identifies a change
needed in the workplan and/or budget, either party may initiate a Change Order using the Change Order Form
provided by the MPCA. Change Orders may not delay or jeopardize the success of the Project, alter the overall
scope of the Project, increase or decrease the overall amount of the Contract/Agreement, or cause an
extension of the term of this Agreement.
The Change Order Form must be approved and signed by the State's Project Manager and the Grantee’s
Authorized Representative in advance of doing the work. Documented changes will then become an integral
and enforceable part of the Agreement. The MPCA has the sole discretion on the determination of whether a
requested change is a Change Order or an Amendment. The State reserves the right to refuse any Change
Order requests.
7.4 Waiver. If the State fails to enforce any provision of this Grant Agreement, that failure does not waive the
provision or the State’s right to enforce it.
7.5 Grant Agreement complete.This Grant Agreement contains all negotiations and agreements between the
State and the Grantee. No other understanding regarding this Grant Agreement, whether written or oral, may
be used to bind either party.
8.Indemnification
The Grantee must indemnify, save, and hold the State, its agents, and employees harmless from any claims or
causes of action, including attorney’s fees incurred by the State, arising from the performance of this Grant
Agreement by the Grantee or the Grantee’s agents or employees. This clause will not be construed to bar any legal
remedies the Grantee may have for the State's failure to fulfill its obligations under this Grant Agreement.
9.State Audits
Under Minn. Stat. § 16B.98, subd. 8, the Grantee’s books, records, documents, and accounting procedures and
practices of the Grantee or other party relevant to this Grant Agreement or transaction are subject to examination
by the State and/or the State Auditor or Legislative Auditor, as appropriate, for a minimum of six (6) years from the
end of this Grant Agreement, receipt and approval of all final reports, or the required period of time to satisfy all
state and program retention requirements, whichever is later.
10.Government Data Practices
The Grantee and State must comply with the Minnesota Government Data Practices Act, Minn. Stat. Ch. 13, as it
applies to all data provided by the State under this grant agreement, and as it applies to all data created, collected,
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received, stored, used, maintained, or disseminated by the Grantee under this grant agreement. The civil remedies
of Minn. Stat. § 13.08 apply to the release of the data referred to in this clause by either the Grantee or the State. If
the Grantee receives a request to release the data referred to in this Clause, the Grantee must immediately notify
the State. The State will give the Grantee instructions concerning the release of the data to the requesting party
before the data is released. The Grantee’s response to the request shall comply with applicable law.
11.Workers’ Compensation
The Grantee certifies that it is in compliance with Minn. Stat. § 176.181, subd. 2, pertaining to workers’
compensation insurance coverage. The Grantee’s employees and agents will not be considered State employees.
Any claims that may arise under the Minnesota Workers’ Compensation Act on behalf of these employees and any
claims made by any third party as a consequence of any act or omission on the part of these employees are in no
way the State’s obligation or responsibility.
12.Governing Law, Jurisdiction, and Venue
Minnesota law, without regard to its choice-of-law provisions, governs this Grant Agreement. Venue for all legal
proceedings out of this Grant Agreement, or its breach, must be in the appropriate state or federal court with
competent jurisdiction in Ramsey County, Minnesota.
13 Termination Termination by the State.
(a)Without Cause. The State may immediately terminate this grant agreement without cause, upon 120-
days’ written notice to the Grantee. Upon termination, the Grantee will be entitled to payment,
determined on a pro rata basis, for services satisfactorily performed.
(b)With Cause. The State may immediately terminate this Grant Agreement if the State finds that there has
been a failure to comply with the provisions of this Grant Agreement, that reasonable progress has not
been made or that the purposes for which the funds were granted have not been or will not be fulfilled.
The State may take action to protect the interests of the state of Minnesota, including the refusal to
disburse additional funds and requiring the return of all or part of the funds already disbursed.
13.2 Termination by The Commissioner of Administration. The Commissioner of Administration may immediately
and unilaterally cancel this grant contract agreement if further performance under the agreement would not
serve agency purposes or performance under the grant agreement is not in the best interest of the State.
13.3 Termination for insufficient funding. The State may immediately terminate this Grant Agreement if:
(a)It does not obtain funding from the Minnesota Legislature.
(b)Or, if funding cannot be continued at a level sufficient to allow for the payment of the services covered by
this Grant Agreement. Termination must be by written notice to the Grantee. The State is not obligated to
pay for any services that are provided after notice and effective date of termination. However, the
Grantee will be entitled to payment, determined on a pro rata basis, for services satisfactorily performed
to the extent that funds are available. The State will not be assessed any penalty if the Grant Agreement is
terminated because of the decision of the Minnesota Legislature, or other funding source, not to
appropriate funds. The State must provide the Grantee notice of the lack of funding within a reasonable
time of the State’s receiving that notice.
14.Data Disclosure
Under Minn. Stat. § 270C.65, subd. 3, and other applicable law, the Grantee consents to disclosure of its federal
employer tax identification number, and/or Minnesota tax identification number, already provided to the State, to
federal and state tax agencies and state personnel involved in the payment of state obligations. These identification
numbers may be used in the enforcement of federal and state tax laws which could result in action requiring the
Grantee to file state tax returns and pay delinquent state tax liabilities, if any.
15.Payment to subcontractors (if applicable)
As required by Minn. Stat. § 16A.1245, the prime contractor must pay all subcontractors, less any retainage, within
ten (10) calendar days of the prime contractor's receipt of payment from the State for undisputed services provided
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by the subcontractor(s) and must pay interest at the rate of one and one-half percent (1 ½ %) per month or any part
of a month to the subcontractor(s) on any undisputed amount not paid on time to the subcontractor(s).
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Signatures
Title Name Signature Date
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