HomeMy WebLinkAboutVIII-9 Utility Disconnection Agreement (Sanitary Sewer Service) - 119 W 2nd Street (Parking Ramp) City Council Memorandum
To: Mayor Fasbender & City Council Members
From: Nick Egger – Public Works Director
Date: May 15, 2019
Item: Parking Ramp at 119 W 2nd Street – Utility Disconnection Agreement
COUNCIL ACTION REQUESTED
Council is requested to approve the attached agreement and authorize the signatures of the Mayor and Clerk for the
property owner to forego ordinance required disconnection and abandonment of a sanitary sewer service to the property
on which the new parking ramp will be located.
BACKGROUND
With the construction of the new parking ramp on the former First National Bank property located at 119 W 2nd Street,
use of the sanitary sewer service line into the property will no longer be needed. The water service will remain connected
and may be utilized in the future for maintenance purposes at the ramp.
Generally, City Ordinances require the owner to disconnect any unused service lines all the way to the main line that is
located underneath W 2nd Street. However, in order to do that, the surface, base material, and perhaps other
underground infrastructure would need to be significantly disturbed, which could result in loss of integrity to these
elements. To avoid this impact, the City, with this Agreement, would waive the requirement that the sanitary sewer
service line be disconnected all the way to the mainline and instead that line would be capped near the curb line in the
boulevard. With this waiver, however, the owner would agree to repair any future problems that may result from the line
not being removed to the main and if the owner would fail to make necessary repairs upon the request of the City, the
City could undertake the repairs and assess the property for the cost of the repairs.
This Agreement, prepared by the City Attorney’s office and in consultation with pertinent City staff, has been forwarded to
the property owner and we anticipate the owner will sign the document in the very near future. Signatures of the Mayor
and Clerk would be affixed upon receipt of the original bearing the signatures of the property owner.
FINANCIAL IMPACT
There should be no financial impact to the City unless there would be a problem with the capped sanitary sewer service
line and in that case, the City may incur costs for repairs but would assess those costs against the property and recoup
those expenses with the payment of real estate taxes.
FINANCIAL IMPACT
Utility Disconnection Agreement
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AGREEMENT REGARDING DISCONNECTION OF SEWER SERVICE LINE AND WAIVER OF PROCEDURAL IRREGULARITY AND ASSESSMENT APPEAL
THIS AGREEMENT, is made this day of May, 2019, between the City of Hastings,
a Minnesota municipal corporation (hereinafter referred to as "City") having a principle address
of 101 East 4th Street, Hastings, Minnesota, 55033, and Confluence Development LLC, a
Minnesota limited liability company (hereinafter referred to as “Owner”) having a principle
address of 101-10th Street East, Suite #300, Hastings, Minnesota, 55033.
RECITALS
WHEREAS, Owner is the owner of real property located generally at 119-2nd Street
West, Hastings, Minnesota 55033 and legally described on the attached Exhibit A (hereinafter
referred to as the “Property”);
WHEREAS, a bank building structure previously existed on the Property and was
connected to municipal sanitary sewer mains beneath 2nd Street West;
WHEREAS, the bank building structure on the Property has been removed in
anticipation of redevelopment in the form of a parking lot structure;
WHEREAS, the original sewer utility service line which previously serviced the former
bank building structure on the Property (hereinafter referred to as the “Original Utility Line”)
runs beneath 2nd Street West and connects to a sewer main under 2nd Street West, as more fully
identified on the attached Exhibit B;
WHEREAS, the Owner does not intend to utilize the Original Utility Line on the
Property;
WHEREAS, as a result of the foregoing, the Original Utility Line will be abandoned and
will not be utilized for future improvements on the Property;
WHEREAS, municipal regulations require Owner to disconnect, at its expense, the
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abandoned Original Utility Line from the sewer main beneath 2nd Street West;
WHEREAS, disconnection of the Original Utility Line from the sewer main beneath 2nd
Street West may result in minor damage and loss of integrity to the surface and base of 2nd Street
West and may also result in unwanted traffic interruptions;
WHEREAS, failure to disconnect the Original Utility Line from the sewer main beneath
2nd Street West may lead to conditions requiring corrective action in the future which may
include, but are not limited to, leaking pipes, surface settlement resulting from broken pipes, or
interference with other construction projects;
WHEREAS, City is willing to waive the current requirement that Owner disconnect and
remove the Original Utility Line completely to the sewer main beneath 2nd Street West, on the
conditions that Owner, its successors and assigns agree: (1) to remove at its cost the Original
Utility Line if reasonably deemed necessary by City; (2) to repair and remedy at its cost any
unwanted conditions caused by the Original Utility Line remaining connected and in place, and
to indemnify and hold harmless City for any resulting damage or claims; (3) that if Owner fails
to perform removal or repair work in a timely manner, City may complete the needed work; and
(4) that City may assess the cost of any such work against the Property as provided in this
agreement; and
WHEREAS, Owner understands that the conditions and potential problems which may
result from the Original Utility Line remaining connected and in place are not certain and cannot
be fully identified or described with certainty but Owner desires to assume all future
responsibility and costs of correcting such conditions and damage.
NOW THEREFORE, in consideration of the City's willingness to waive the current
requirement that Owner disconnect and remove the Original Utility Line completely to the sewer
main beneath 2nd Street West, the parties make the following agreement:
A. City waives the current requirement that Owner disconnect and remove the Original
Utility Line completely to the sewer main beneath 2nd Street West, subject to the
conditions and requirements set forth herein.
B. In the event there is leakage from the Original Utility Line or disturbance to the ground
above the Original Utility Line that the City reasonably determines has been caused by a
breakage or other issue with the Original Utility Line (a “Removal Event”), then, upon
written demand by City, Owner at its cost shall disconnect and remove the Original
Utility Line completely to the sewer main beneath 2nd Street West and reasonably restore
any disturbed areas to their original conditions. If Owner fails to perform the removal or
repair work as required herein within a reasonable time period after the occurrence of a
Removal Event and the City’s delivery of written notice as required hereunder, City may
undertake all work necessary to disconnect and remove the Original Utility Line, and
Owner shall immediately reimburse City for all costs actually incurred by the City in
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connection with removal of the Original Utility Line (the “Removal Expense”), which
costs shall be documented using invoices or other customary billing documentation.
C. If Owner fails to timely reimburse City for all of the Removal Expense, Owner, for itself,
its successors and assigns, agrees that the City may cause an assessment to be levied
against the Property in the amount of the Removal Expense plus a $25.00 fee (if the
Removal Expense is $10,000.00 or less) or a $50.00 fee (if the removal expense is greater
than $10,000.00).
D. If the Removal Expense is $10,000.00 or less, the resulting assessments shall be paid
over a period of five years, but if the Removal Expense is over $10,000.00, the
assessment shall be paid over a ten year period. In addition, interest shall accrue on the
unpaid assessment at a rate equal to the interest rate applied by the City of Hastings for
other assessments in the year the work is performed. If no such assessments are certified
for other properties in the City of Hastings during that year, the interest rate shall be
equal to the interest rate imposed on the most recent assessment certified by the City of
Hastings.
E. Owner, for itself, its successors and assigns, agrees that—upon the occurrence of a
Removal Event and Owner’s failure to fully address such Removal Event as required
under Paragraph B of this Agreement—City can certify an assessment to Dakota County
for collection with the real estate taxes in the amount of the Removal Expense plus the
fee identified in Paragraph C without the necessity of City complying with any of the
procedural or notice requirements outlined in Minnesota Statutes Chapter 429, or
amendments thereto.
F. In further consideration of City’s agreement to waive the current requirement that the
Original Utility Line be removed completely to the sewer main beneath 2nd Street West,
Owner, for itself, its successors and assigns, also agrees to waive any right to appeal the
amount assessed against the Property for these removal and repair costs, whether the
basis for the appeal is that the assessment exceeds the benefits to the Property or on any
other basis whatsoever, provided that Owner shall retain the right to enforce compliance
with the terms of this Agreement.
G. Where reference is made herein to Owner, reference shall be to Owner, its successors and
assigns as to the Property and the rights and obligations hereunder shall run with the land
and shall burden the Property and all subsequent Owners thereof and City shall record
this Agreement on the public property records to provide notice of this agreement and all
obligations hereunder to subsequent Owners of the Property.
H. Owner shall indemnify and hold harmless City for any damages or claims resulting from
the Original Utility Line remaining connected and in place pursuant to this Agreement
except to the extent such damages or claims result from the gross negligence or willful
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misconduct of the City or its employees, agents, officers, officials, or contractors.
I. This Agreement shall be construed and enforced in accordance with the laws of the State
of Minnesota and any dispute shall be venued in the Dakota County District Court.
Owner consents to the jurisdiction of the Minnesota state courts.
The City and Owner enter and sign this agreement with full understanding of their legal rights
and acknowledge they have had sufficient opportunity to discuss this matter with an attorney of
their choosing.
Dated: , 2019. CITY OF HASTINGS,
A Minnesota Municipal Corporation
By:____________________________________
Mary Fasbender, Its Mayor
(SEAL)
By: ____________________________________
Julie Flaten,
City Clerk
ACKNOWLEDGMENT
STATE OF MINNESOTA )
) ss.
COUNTY OF DAKOTA )
The foregoing instrument was acknowledged before me this day of _________, 2019,
by Mary Fasbender and Julie Flaten, the Mayor and City Clerk of the City of Hastings, a
Minnesota municipal corporation.
______________________________
Notary Public
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Dated: , 2019. OWNER:
Confluence Development LLC
A Minnesota limited liability company
By: __________________________________
Patrick Regan, Vice President
ACKNOWLEDGMENT
STATE OF ____________ )
) ss.
COUNTY OF __________)
The foregoing instrument was acknowledged before me this day of _________, 2019,
by Patrick Regan as Vice President of Confluence Development LLC, a Minnesota limited
liability company.
______________________________
Notary Public
THIS INSTRUMENT DRAFTED BY:
FLUEGEL LAW FIRM P.A.
999 Westview Drive, Suite #1
Hastings MN 55033
651-438-9777
(DAN/has)
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EXHIBIT A
LEGAL DESCRIPTION PARKING LOT PARCEL
Lots 2, 3 and 4, Block 12, Town of Hastings, Dakota County, Minnesota.
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