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HomeMy WebLinkAboutMarch 01, 2022 - EDA Packet Shakopee Economic Development Authority "Dile*AI March 1, 2022 SHAKOPEE, 7:00 PM City Hall, 485 Gorman St. 1. Roll Call 2. Approval of Agenda 3. Consent Business 3.A. EDA Minutes 3.B. Tax Increment Spending Plan 4. General Business 4.A. Amendment to Contract with Shakopee Chamber 5. Reports 5.A. EDA Bill List 6. Adjourn to Tuesday, April 5, 2022 at 7:00 pm Note to EDA Members: If you have any questions or need additional information on any of the above items,please call Michael Kerski,prior to the meeting at(952)233-9346. Page 1 of 41 3.A. WILLA' SHAKOPEE Shakopee Economic Development Authority March 1, 2022 FROM: Lori J. Hensen, City Clerk TO: EDA Board Subject: EDA minutes of February 2, 2022. Policy/Action Requested: Approve the minutes from February 2, 2022. Recommendation: Approve the minutes from February 2, 2022. Discussion: Budget Impact: ATTACHMENTS: ❑ February 2, 2022 Page 2 of 41 Shakopee Economic Development Authority llliktilifrAl MINUTES February 2, 2022 SHAKOPEE 7:00 PM City Hall, 485 Gorman St. 1. Roll Call Present: President Jody Brennan, Commissioners Bill Mars, Matt Lehman, Jay Whiting, Angelica Contreras Staff Present: City Administrator Bill Reynolds, Assistant City Administrator Chelsea Petersen, City Attorney Jim Thomson, Finance Director Nate Reinhardt, City Engineer/Public Works Director Steve Lillehaug, Planning/Development Director Michael Kerski, Parks/Recreation Director Jay Tobin, Police Chief Jeff Tate, Recreation Facilities Manager Troy Ciernia, Community Engagement Coordinator Carla Kress 2. Approval of Agenda Commissioner Matt Lehman made a motion to approve the agenda as modified, seconded by Commissioner William Mars and the motion passed. 5 - 0 3. Consent Business Commissioner Angelica Contreras made a motion to approve the Consent Agenda, seconded by Commissioner Jay Whiting and the motion passed. 5 - 0 3.A. Tax Increment Spending Plan This item was removed from the agenda. 3.B. EDA Minutes Motion to approve the meeting minutes of January 4, 2022 (motion carried under the Consent Agenda) 4. General Business 4.A. Entrepreneurship Report to Date Commissioner William Mars made a motion to accept report and continue contract with Momentum through the end of 2022 for an amount of$65,000 and not to exceed Page 3 of Ill $12,000 in expenses to be paid out of Coronavirus Local Fiscal Recovery Funds, seconded by Commissioner Angelica Contreras and the motion passed. 5 - 0 5. Reports 5.A. EDA Bill List Informational item only. 6. Adjourn to Tuesday, March 1, 2022 at 7:00 pm Commissioner William Mars made a motion to adjourn to Tuesday, March 1, 2022 at 7:00 p.m., seconded by Commissioner Angelica Contreras and the motion passed5 - 0 Page 2 of 31 3.B. WILLA! SHAKOPE E Shakopee Economic Development Authority March 1, 2022 FROM: Nate Reinhardt, Finance Director TO: President and Commission Members Subject: Tax increment spending plan Policy/Action Requested: Adopt Resolution E2022-004 approving a spending plan for certain tax increment financing districts located in the City of Shakopee. Recommendation: Approval Discussion: The State Legislature amended the TIF law in 2021 to provide flexibility to cities to utilize unobligated TIF balances in existing districts in order to promote construction and job creation in their communities. The law allows cities to provide assistance for private development that creates or retains jobs, without counting against the pooling limitations of the districts. The EDA has until December 31, 2022 to transfer the funds to another designated City/EDA fund and the dollars must be spent by December 31, 2025. In order to preserve the ability to use this tool, the City and EDA are required to develop a spending plan that identifies the TIF districts that will fund defined projects, hold a public hearing, adopt the plan and submit it to the State Auditor. Budget Impact: If the spending plan is approved, the City/EDA does not commit assistance to a development project, but rather reserves the right to do so in the future. Staff estimates the current available unobligated increment is approximately $500,000. Preference for financing assistance will be for private development that provides for high wage job creation or development of housing, including but not limited to, market rate and affordable multi-family, Page 5 of 41 town homes and single-family units. ATTACHMENTS: o E2022-004 - Tax Increment Spending Plan o Proposed Tax Increment Spending Plan o OSA Statement of Position (2021 TIF Law) o TIF Spending Plan (Presentation) Page 6 of 41 ECONOMIC DEVELOPMENT AUTHORITY FOR THE CITY OF SHAKOPEE, MINNESOTA RESOLUTION NO. E2022-004 RESOLUTION APPROVING A SPENDING PLAN FOR CERTAIN TAX INCREMENT FINANCING DISTRICTS LOCATED IN THE CITY OF SHAKOPEE WHEREAS, the Economic Development Authority for the City of Shakopee, Minnesota (the"Authority") and the City of Shakopee (the"City") have previously established the following tax increment financing districts located in the City (collectively, the "TIF Districts"), and adopted tax increment financing plans therefor, pursuant to Minnesota Statutes, Sections 469.001 through 469.047, as amended, and Minnesota Statutes, Sections 469.174 through 469.1794, as amended (the "TIF Act"): Tax Increment Financing District No. 10 (River City Center), Tax Increment Financing District No. 14 (SanMar), Tax Increment Financing District No. 15 (All Saints), Tax Increment Financing District No. 16 (Rahr), Tax Increment Financing District No. 17 (Amazon), Tax Increment Financing District No. 18 (Canterbury), Tax Increment Financing District No. 19 (Riverfront), Tax Increment Financing District No. 20 (Enclave), and Tax Increment Financing District No. 21 (Southbridge Soils); and WHEREAS, Section 469.176, subdivision 4n of the TIF Act (the "Temporary TIF Authority Act") authorizes the Authority to spend available tax increment from any existing tax increment financing district, notwithstanding any other law to the contrary, to provide improvements, loans, interest rate subsidies, or assistance in any form to private development consisting of construction or substantial rehabilitation of buildings and ancillary facilities, if the following conditions exist: (1) Such assistance will create or retain jobs in the State of Minnesota, including construction jobs; (2) Construction commences before December 31, 2025; (3) The construction would not have commenced before the dates specified above without the assistance; (4) Tax increments under the spending plan are spent by December 31, 2025; and (5) The City Council of the City (the "City Council") approves a written spending plan (after a duly noticed public hearing) that specifically authorizes the Authority to take such actions; and WHEREAS, the Authority proposes to adopt a spending plan for the TIF Districts (the "Spending Plan") in accordance with the Temporary TIF Authority Act in substantially the form submitted to the Board of Commissioners of the Authority (the "Board") to utilize existing tax Page 7 of 41 increment revenues from the TIF Districts in order to stimulate construction or rehabilitation of private development in a way that will also create or retain jobs; and WHEREAS, the assistance authorized under the Spending Plan expressly includes but is not limited to assistance for private development that provides for high-wage job creation or development of housing, including but not limited to market rate and affordable multifamily, townhomes, and single-family units; and WHEREAS, assistance authorized and provided under the Spending Plan may constitute a business subsidy as described in Minnesota Statutes, Sections 116J.993 to 116J.995, as amended (the "Business Subsidy Act"), which will require that the Board conduct a public hearing prior to providing such financial assistance to a developer; and WHEREAS, on the date hereof, the City Council of the City will conduct a public hearing regarding the Spending Plan, for which notice was published in a newspaper of general circulation in the City and on the City's public website at least ten (10) days but not more than thirty (30) days prior to the date of the public hearing, and consider a resolution approving the Spending Plan; and NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Economic Development Authority for the City of Shakopee, Minnesota that: 1. The Spending Plan is hereby approved in substantially the form on file in City Hall. 2. The Authority makes all the findings set forth in the Spending Plan, which are incorporated herein by reference. 3. Authority staff and consultants are hereby authorized to take actions necessary to carry out the terms of the Spending Plan. 4. The Board shall conduct a public hearing prior to providing financial assistance to a developer under the Spending Plan if in the opinion of counsel to the Authority such assistance constitutes a business subsidy under the Business Subsidy Act. Sworn and Executed Under My Hand this 1st day of March, 2022. President Executive Director 2 Error!Unknown document property name. Page 8 of 41 EDA Adoption Date: , 2022 CITY Adoption Date: , 2022 l°11L1 SFIAIKOPEE Shakopee Economic Development Authority City of Shakopee, Scott County, Minnesota SPENDING PLAN TIF District 10 (River City Center) TIF District 14 (San Mar) TIF District 15 (All Saints) TIF District 16 (RAH R) TIF District 17 (Amazon) TIF District 18 (Canterbury) TIF District 19 (Riverfront) TIF District 20 (Enclave) TIF District 21 (Southbridge Soils) EHLERS Prepared by: Ehlers 3060 Centre Pointe Drive Roseville, Minnesota 55113 BUILDING COMMUNITIES. IT'S WHAT WE DO. Page 9 of 41 SPENDING PLAN FOR TIF DISTRICTS 10 (RIVER CITY CENTER), 14 (SANMAR), 15 (ALL SAINTS), 16 (RAHR), 17 (AMAZON), 18 (CANTEBURY), 19 (RIVERFRONT), 20 (ENCLAVE), AND 21 (SOUTHBRIDGE SOILS) I. PURPOSE The Shakopee Economic Development Authority (the "Authority") administers the Tax Increment Financing Districts listed above (the "TIF Districts") in the City of Shakopee, Minnesota (the "City"), and proposes to adopt a Spending Plan for the TIF Districts in accordance with Minnesota Statutes, Section 469.176 Subd. 4n (the "Act"). The purpose of the Spending Plan is to develop or redevelop sites, lands or areas within the City in conformity with the City's Comprehensive Plan or other City plans or objectives by using available tax increments from the TIF Districts to provide improvements, loans, interest rate subsidies, or assistance in any form to private development consisting of the construction or substantial rehabilitation of buildings and ancillary facilities, which will create or retain jobs in this state, including construction jobs. II. PLAN The Authority is authorized as follows: (a) To use available tax increments from the TIF Districts to provide improvements, loans, interest rate subsidies, or assistance in any form to private development consisting of the construction or substantial rehabilitation of buildings and ancillary facilities (the "Projects") in financing assistance to further the goals in the City's Comprehensive Plan or other City plans or objectives, if doing so will create or retain jobs in the state, including construction jobs. Preference for financing assistance will be for private development that provides for high wage job creation or development of housing, including but not limited to, market rate and affordable multi-family, town homes and single-family units. The Projects shall commence before December 31, 2025 (unless a later commencement date is authorized by law) and shall constitute Projects that would not commence by such date without the assistance provided pursuant to this Spending Plan. (b) To amend the budget set forth in the Tax Increment Financing Plans for the TIF Districts if necessary, to provide for the assistance authorized by this Spending Plan. (c) To take any other action necessary and authorized under the Act in connection with the construction or substantial rehabilitation of facilities of the type described in clause (a) above. The assistance provided pursuant to this Plan shall be subject to Minnesota Statutes, Sections 116J.993 to 116J.995 (the "Business Subsidy Law"), if applicable, and shall be subject to the City's Business Subsidy Policy. Page 10 of 41 STATE OF MINNESOTA tSA Julie Blaha Suite 500 525 Park Street State Auditor Office of the State Auditor Saint Paul, MN 55103 Statement of Position Temporary Transfer Authority(2021 Law) Tax increment revenue may be spent only as permitted by the Tax Increment Financing Act (TIF Act). In 2021,the Legislature enacted expanded,temporary authority to transfer unobligated tax increments for purposes of assisting private development consisting of the construction or substantial rehabilitation of buildings and ancillary facilities, if doing so will create or retain jobs in the state.' Proposed amidst the COVID-19 pandemic,the enacted law is narrower than initially proposed and is similar to 2010 legislation that temporarily expanded the use of TIF with the aim of stimulating economic recovery after the Great Recession.' Authority,Purposes The new law temporarily permits a development authority to elect, by resolution,to transfer unobligated increment for certain specified purposes.The new law does not, however, override requirements to pay bonds to which increments are pledged. Any transfer under this provision must be for the purpose of assisting private development that meets all of the following criteria: (1) it consists of the construction or substantial rehabilitation of buildings and ancillary facilities; (2) it creates or retains jobs in the state, including construction jobs;and (3) construction commences before December 31, 2025, and would not have commenced before that date without the assistance.' Developments that would already commence construction prior to December 31, 2025,or those that do not add or retain jobs in the state,would not be permitted beneficiaries of the transfer. Transfers must provide the assistance in one or both of the following ways: (1) by providing improvements, loans, interest rate subsidies, or assistance in any form to the private development; or 1 The TIF Act is found at Minn.Stat.§§469.174 to 460.1794. 2 Minn.Stat.§469.176,subd.4n,as enacted by 2021 Minn.Laws,1St Spec.Sess.,ch.14,art.9 sec. 1. 3 The 2021 enacted provision does not include transfers to the general fund, nor more-generalized support for businesses impacted by the pandemic,as was initially entertained.While similar to the 2010 Jobs Stimulus provision,additional details are included. For information about the 2010 provision, see the separate TIF Jobs Stimulus Program statement of position on our website. 4 Minn.Stat.§469.176,subd.4n(a). New: August 2021 Main: (651) 296-2551 *Fax: (651) 296-4755 • TTY: (800) 627-3529• State.Auditor@osa.state.mn.us • www.osa.state.mn.us An equal opportunity employer Page 11 of 41 (2) by making an equity or similar investment in a corporation, partnership, or limited liability company that the authority determines is necessary to make construction of a development financially feasible.5 In order to demonstrate compliance with the new provision,an authority may wish to include affirmation of the qualifications in the written resolution electing to make the transfer.The authority also should keep documentation that demonstrates that the development created or retained jobs in the state and that commencement of construction by December 31, 2025, depended on the transfer. Approvals and Spending Plans Prior to approving the use of this temporary transfer authority by resolution, a development authority must also create a written spending plan that authorizes the development authority to provide the assistance or make the investment that makes the development qualify.6 The plan must detail the use of transferred increment.'The OSA recommends identifying planned expenditures using the same categories identified in TIF plans and TIF reporting(e.g., acquisition, site preparation, financing costs, etc.),except for a category for administrative expenses, because administrative expenses are not included in the permissible uses of the transferred increment in the new law. The municipality(which may or not be the same as the development authority) must also approve the authority's spending plan after holding a public hearing.'The municipality must publish notice of the hearing in a newspaper of general circulation in the municipality and on the municipality's public website at least ten days, but not more than 30 days, prior to the date of the hearing.' An authority making a transfer under this authority must provide a copy of the spending plan approved and signed by the municipality to the Office of the State Auditor.10 Plans should be emailed to TIF@osa.state.mn.us as soon as possible after their approval. Parameters and Limitations The authority to transfer increments under this provision expires on December 31, 2022.11 Amounts being transferred under this provision must be transferred from the fund or account in which tax increments are segregated and into a separate fund or account by December 31, 2022.Amounts must not be expended directly from the transferring TIF fund or account, and may not be spent after December 31, 2022, if they remain in the TIF district's fund or account at that time.12 All transfers must be spent by December 31, 2025.13 S Id. 6 Minn.Stat.§469.176,subd.4n(c). Id. 8 Id. A city's housing and redevelopment authority or economic development authority,for example, may be the development authority while the city itself is the municipality. 9 Id. 10 Minn.Stat.§469.176,subd.4n(e). 11 Minn.Stat.§469.176,subd.4n(f). 12 Minn.Stat.§469.177,subd.5,requires an authority to segregate tax increment received with respect to any district in a special account or accounts on its official books and records. This authority allows transfers out of such accounts as opposed to expenditures from within these accounts. 13 Minn.Stat.§469.176,subd.4n(f). New: August 2021 2 Page 12 of 41 Transfers from a TIF district in calendar years 2021 and 2022 are limited to a maximum transfer equal to the excess of the district's unobligated increment.14 Under the provision, unobligated increment includes any increment not required for payment of obligations due during the six months following the transfer on outstanding bonds, binding contracts, and other outstanding financial obligations of the district to which the district's increment is pledged."S Therefore,the transfer of increment for 2021 is limited to the eligible balance of tax increment at the end of 2020, less amounts needed to pay bonds, pay-as-you-go notes, and interfund loans due from January 1, 2021,to June 30, 2021. Similarly,the transfer of increment for 2022 is limited to the eligible balance of tax increment at the end of 2021, less amounts needed to pay bonds, pay-as-you-go notes, and interfund loans due from January 1, 2022, to June 30, 2022. Presumably, receipts of tax increment for the first half taxes in each year would be used to make payments on outstanding obligations due in the second half of each year, but note that this authority does not provide any exception to pay those obligations to which tax increment is pledged, and an authority should not transfer amounts that might impair their ability to make payments on those obligations. Increment that is improperly retained, received, spent, or transferred is not eligible for transfer under this authority.16 Therefore,the 2020 and 2021 balances of tax increment should be carefully evaluated prior to making transfers in 2021 and 2022, respectively. For example, excess increment calculated for 2019 that might remain in the TIF fund after it should have been returned by September 30, 2020, would not be eligible for transfer, nor would any subsequent excess increment be eligible for a transfer after it should have been returned. Likewise, if a district receives tax increment after it should have decertified under the Six-Year Rule, such amounts of increment would also not be eligible for transfer. Unspent Transfers Increment not spent by December 31, 2025, must be returned to the fund(s)of the contributing TIF district(s).17 The distribution of returned amounts need not be proportional to the amount contributed, but the amount returned to each TIF district must not exceed the amount transferred from the district. 14 Minn.Stat.§469.176,subd.4n(b). 151d. Interfund loans are included in the definition of"bonds"in the TIF Act(see Minn.Stat.§469.174,subd.3),so payments on interfund loans should not be foregone to increase a transfer under this authority. 16 Minn.Stat.§469.176,subd.4n(d). 17 Minn.Stat.§469.176,subd.4n(f). 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Policy/Action Requested: Approve amended contract with the Shakopee Chamber of Commerce to now include event requirements and sponsorship and maintain financial support at $25,000 per city fiscal year.. Recommendation: Approve amended contract. Discussion: In the past five years there has been five Main Street directors. Staff has met with the Chamber management and we both agreed that most people downtown call the city with issues, concerns or ideas. The Chamber has agreed that the City/E DA will take on the communication responsibilities to the downtown building owners and business. This will include various committees to ensure that issues are heard. The city has been working to fill the vacant downtown storefronts and also works with outside agencies to help new businesses that may open downtown. This has included the new brewery in the Deco and a new store going into River City Center. City staff will manage the business side of downtown while the Chamber staff will handle events, their impacts and fund raising for events. Chamber staff will still attend meetings and will be kept abreast of issues by the city. The downtown flower baskets were something that Main Street has done in the past. Last year, Shakopee Public Utilities and the city did the baskets and city staff maintains them along with the various planters downtown. This collaboration will let the Chamber focus its funding more strategically on events, marketing and funding possible improvements like benches or public art. Page 21 of 41 The main changes to the current contract is the city will take on more interaction with the merchants and building owners and the city will become a sponsor while the Chamber will ensure that the three main events are held downtown including Rhythm on the Rails, a Fall event and the holiday event. Budget Impact: ATTACHMENTS: ❑ 2022 proposed contract ❑ 2021 proposed contract Page 22 of 41 Service Contract This Contract ("Contract"), made this 1St day of March 2022 by and between the City of Shakopee and the Economic Development Authority ("CITY") and the Shakopee Area Chamber of Commerce, a nonprofit corporation organized under the laws of the State of Minnesota ("CHAMBER"). WHEREAS, the CITY requires certain professional services to assist the CITY in completing its economic development initiatives in the CITY's Downtown Business District (the "Project"); and WHEREAS, the CHAMBER agrees to furnish the various professional services required by the CITY. NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, the Parties agree as follows: SECTION I - CHAMBER SERVICES AND RESPONSIBILITIES A. Scope of Services. CHAMBER agrees to perform various Project services as detailed in Exhibit 1, Scope of Services, attached hereto and incorporated herein by reference. 1. The CHAMBER agrees to maintain, at its expense, statutory worker's compensation coverage. 2. The CHAMBER agrees to maintain, at its expense, general liability insurance coverage insuring CHAMBER against claims for bodily injury, death or property damage arising out of its general business activities (including automobile use). The CITY shall be an additional named insured on the Consultant's CGL insurance policy. The liability insurance policy shall provide coverage for each occurrence in the minimum amount of $1,000,000.00. 3. True, accurate and current certificates of insurance, showing evidence of the required insurance coverage, are hereby provided to the CITY and are attached hereto as Exhibit 4. The Shakopee Area Chamber of Commerce will provide events as noted in exhibit and will be the member of the Main Street program. Page 23 of 41 SECTION II-THE CITY'S RESPONSIBILITIES A. The CITY shall compensate the CHAMBER for services rendered to CITY as part of the Project $25,000 in two payments of$12,500 each, one in January 2021 and one in August 2021. B. The CITY understands that the CHAMBER will seek an extension of this Contract for 2022 at the same amount as stated above, which will be subject to CITY approval. The CITY understands that without approval of the program by the CITY, the program will cease to operate. C. The CITY requests that any future requests for extension of this Contract for 2022 or beyond be made to CITY by June 15, 2021 to be reviewed for recommendation for inclusion into the CITY annual EDA budget. Requests should be directed in writing to the Director, Planning and Development Department; City Hall, 485 Gorman Street, Shakopee, Minnesota, 55379. SECTION III - TERMS AND CONDITIONS A. Term. This Contract shall commence January 1, 2021 and be in effect until December 31, 2021. B. Default. If CHAMBER fails to perform any of the provisions of this Contract or so fails to administer the services detailed in Exhibit 1, attached hereto, in such a manner as to endanger the performance of the Contract, this shall constitute default. Unless CHAMBER's default is excused by the CITY, the CITY may, upon written notice, immediately cancel this Contract or exercise any other rights or remedies available to the CITY under this Contract or law. C. Liability. The CITY shall have no duty or obligation hereunder other than to take such specific actions as are required of it from time to time by the provisions of this Contract and it shall incur no liability hereunder or in connection herewith for anything whatsoever other than any liability resulting from its own gross negligence or willful misconduct or unlawful acts or omissions. The only duties and responsibilities of the CITY shall be the duties and obligations specifically set forth in this Contract. D. Indemnification. CHAMBER shall indemnify, hold harmless and defend the CITY from and against any and all losses, claims, liabilities, and reasonable expenses, including the reasonable fees of its counsel, specifically including in-house counsel fees, which it may suffer or incur in connection with the performance of any duties and obligations under this Contract, except for those losses, claims, liabilities and expenses resulting solely and directly from the CITY'S own gross negligence, willful misconduct, or unlawful act or omission. All indemnification obligations shall survive termination, expiration or cancellation of this Contract. CITY shall indemnify, hold harmless and defend the CHAMBER from and against any and all losses, claims, liabilities, and reasonable expenses, including the reasonable fees of its counsel, specifically including in-house counsel fees, which it may suffer or incur in connection with the performance of any duties and obligations under this Contract, except for those losses, claims, liabilities and expenses resulting solely and directly from the CHAMBER'S own gross negligence, willful misconduct, or unlawful act or omission. All indemnification obligations shall survive termination, expiration or cancellation of this Contract. Page 24 of 41 E. Contingencies. This Contract is expressly contingent upon the CITY approving a budget allocating the funds specified herein for the purpose stated herein. In the event, for any reason, funds are not included in the approved CITY budget and available for expenditure for this Contract, then this Contract shall be null and void without any obligation by the CITY or CHAMBER. F. Termination. Either party may terminate this agreement upon providing 90 days written notice to the other party. Due to the fixed costs of starting and managing this program, regardless of the timing of termination by either party, any payments made to the CHAMBER by the CITY will not be refunded. G. Voluntary and Knowing Action. The PARTIES, by executing this Contract, state that they have carefully read this Contract and understand fully the contents thereof; that in executing this Contract they voluntarily accept all terms described in this Contract without duress, coercion, undue influence, or otherwise, and that they intend to be legally bound thereby. H. Authorized Signatories. The PARTIES each represent and warrant to the other that (1) the persons signing this Contract are authorized signatories for the entities represented, and (2) no further approvals, actions or ratifications are needed for the full enforceability of this Contract against it; each party indemnifies and holds the other harmless against any breach of the foregoing representation and warranty. I. Notices. The PARTIES' representatives for notification for all purposes are: THE CITY: Bill Reynolds, City Administrator 485 Gorman Street Shakopee, MN 55379 (952) 233-9311 breynolds@shakopeemn.gov Michael Kerski, Director, Planning & Development mkerski@shakopeemn.gov CHAMBER: Tim Zunker, President 1801 East County Road 101 Shakopee, MN 55379 (952)445-1660 tzunker@shakopee.org Any notice provided for or permitted under this Contract, unless otherwise provided herein, will be treated as having been received (a) when delivered personally, (b) when sent by confirmed facsimile or (c) three (3) days following when sent by certified mail, to the party to be notified, at the address set forth below, or at such other place of which the other party has been notified in accordance with the provisions of this paragraph. Such notice will be treated as having been Page 25 of 41 received upon actual receipt if actual receipt occurs earlier than as provided in clauses (a) through (c) hereof. J. Independent Contractor Status. CHAMBER at all times and for all purposes hereunder, shall be an independent contractor and is not an employee of the CITY or EDA for any purpose. The CITY acknowledges that no withholding or deduction for State or Federal income taxes, FICA, FUTA, or otherwise, will be made from the payments due CHAMBER, and that it is CHAMBER's sole obligation to comply with the applicable provisions of all Federal and State tax laws. CHAMBER shall at all times be free to exercise initiative, judgment and discretion as to how to best perform or provide services identified herein. CHAMBER is responsible for hiring sufficient workers to perform the services/duties required by this Contract, withholding their taxes and paying all other employment tax obligations on their behalf. H. Subcontracting. CHAMBER shall not enter into any subcontract for performance of any services contemplated under this Contract without the prior written approval of the CITY. CHAMBER shall be responsible for the performance of all subcontractors and/or sub- consultants. I. Assignment. This Contract may not be assigned by either Party without the written consent of the other Party. J. Modifications/Amendment. Any alterations, variations, modifications, amendments or waivers of the provisions of this Contract shall only be valid when they have been reduced to writing, and signed by authorized representative of the CITY and CHAMBER. K. Records-Availability and Retention. Pursuant to Minn. Stat.§ 16C.05, subd. 5, CHAMBER agrees that the CITY, the State Auditor, or any of their duly authorized representatives at any time during normal business hours and as often as they may reasonably deem necessary, shall have access to and the right to examine, audit, excerpt, and transcribe any books, documents, papers, records, etc., which are pertinent to the accounting practices and procedures of CHAMBER and involve transactions relating to this Contract. CHAMBER agrees to maintain these records for a period of six years from the date of termination of this Contract. L. Force Majeure. The PARTIES shall each be excused from performance under this Contract while and to the extent that either of them are unable to perform, for any cause beyond its reasonable control. Such causes shall include, but not be restricted to fire, storm, flood, earthquake, explosion, war, total or partial failure of transportation or delivery facilities, raw materials or supplies, interruption of utilities or power, and any act of government or military authority. In the event either party is rendered unable wholly or in part by force majeure to carry out its obligations under this Contract then the party affected by force majeure shall give written notice with explanation to the other party immediately. M. Compliance with Laws. CHAMBER shall abide by all Federal, State and local laws, statutes, ordinances, rules and regulations now in effect or hereinafter adopted pertaining to this Contract or to the facilities, programs and staff for which CHAMBER is responsible. N. Covenant against Contingent Fee. CHAMBER warrants that it has not employed or retained any company or person, other than a bona fide employee working solely for CHAMBER to solicit or secure this Contract, and that it has not paid or agreed to pay any company or person, other Page 26 of 41 than a bona fide employee, any fee, commission, percentage, brokerage fee, gift or any other consideration, contingent upon or resulting from award or making of this Contract. O. Covenant against Vendor Interest. CHAMBER warrants that it is not employed by any vendor of equipment or service provider that could result in a commission, percentage, brokerage, or contingent fee as a result of CHAMBER association with the CITY. P. Non-Discrimination. The provisions of any applicable law or ordinance relating to civil rights and discrimination shall be considered part of this Contract as if fully set forth herein. Q. Interest by EDA or City Officials. No elected official, officer, or employee of the CITY or EDA shall during his or her tenure or employment and for one year thereafter, have any interest, direct or indirect, in this Contract or the proceeds thereof. R. Governing Law. This Contract shall be deemed to have been made and accepted in Scott County, Minnesota, and the laws of the State of Minnesota shall govern any interpretations or constructions of the Contract without regard to its choice of law or conflict of laws principles. S. No Partnership, Joint Venture, or Fiduciary Relationship. Nothing contained in this Contract shall be interpreted as creating a partnership, joint venture, or relationship of principal and agent between the CITY and CHAMBER. T. Data Practices. The PARTIES acknowledge that this Contract is subject to the requirements of Minnesota's Government Data Practices Act, Minnesota Statutes, Section 13.01 et seq. U. No Waiver. Any Party's failure in any one or more instances to insist upon strict performance of any of the terms and conditions of this Contract or to exercise any right herein conferred shall not be construed as a waiver or relinquishment of that right or of that Party's right to assert or rely upon the terms and conditions of this Contract. Any express waiver of a term of this Contract shall not be binding and effective unless made in writing and properly executed by the waiving Party. V. Severability. The invalidity or unenforceability of any provision of this Contract shall not affect the validity or enforceability of any other provision. Any invalid or unenforceable provision shall be deemed severed from this Contract to the extent of its invalidity or unenforceability, and this Contract shall be construed and enforced as if the Contract did not contain that particular provision to the extent of its invalidity or unenforceability. W. Entire Contract. These terms and conditions constitute the entire Contract between the PARTIES regarding the subject matter hereof. All discussions and negotiations are deemed merged in this Contract. X. Headings and Captions. Headings and captions contained in this Contract are for convenience only and are not intended to alter any of the provisions of this Contract and shall not be used for the interpretation of the validity of the Contract or any provision hereof. Y. Survivability. All covenants, indemnities, guarantees, releases, representations and warranties by any Party or PARTIES, and any undischarged obligations of the CITY and CHAMBER arising prior to the expiration of this Contract (whether by completion or earlier termination), shall survive such expiration. Page 27 of 41 SECTION VII - SIGNATURES IN WITNESS WHEREOF, the PARTIES have hereunto executed this document the day and year first above written. Chamber of Commerce as provider of Services: By: Date: President, Chamber of Commerce City of Shakopee By: Date: William Mars, Mayor By: Date: Bill Reynolds, City Administrator By: Date: Jody Brennan, EDA President Page 28 of 41 EXHIBIT 1 SCOPE OF SERVICES Subject to the terms of this Contract, CHAMBER shall perform the following services as its contractual obligation to the CITY: 1. CHAMBER will put on the following events in downtown Shakopee under the Main Street umbrella and list the City of Shakopee as a sponsor: A. Rhythm on the Rails, a five-night concert series B. Fall holiday event C. Holiday Fest EXHIBIT 2 Page 29 of 41 CERTIFICATES OF REQUIRED INSURANCE COVERAGES [Certificates of Insurance attached hereto] Page 30 of 41 Service Contract This Contract ("Contract"), made this 6th day of April, 2021 by and between the City of Shakopee and the Economic Development Authority ("CITY") and the Shakopee Area Chamber of Commerce, a nonprofit corporation organized under the laws of the State of Minnesota ("CHAMBER"). WHEREAS, the CITY requires certain professional services to assist the CITY in completing its economic development initiatives in the CITY's Downtown Business District (the "Project"); and WHEREAS, the CHAMBER agrees to furnish the various professional services required by the CITY. NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein, the Parties agree as follows: SECTION I - CHAMBER SERVICES AND RESPONSIBILITIES A. Scope of Services. CHAMBER agrees to perform various Project services as detailed in Exhibit 1, Scope of Services, attached hereto and incorporated herein by reference. 1. The CHAMBER agrees to maintain, at its expense, statutory worker's compensation coverage. 2. The CHAMBER agrees to maintain, at its expense, general liability insurance coverage insuring CHAMBER against claims for bodily injury, death or property damage arising out of its general business activities (including automobile use). The CITY shall be an additional named insured on the Consultant's CGL insurance policy. The liability insurance policy shall provide coverage for each occurrence in the minimum amount of $1,000,000.00. 3. True, accurate and current certificates of insurance, showing evidence of the required insurance coverage, are hereby provided to the CITY and are attached hereto as Exhibit 4. The Shakopee Area Chamber of Commerce will manage a Shakopee Main Street Program for the benefit of Shakopee. The Chamber will hire a full time Main Street Director whose activities will be overseen by the Shakopee Chamber President. Page 31 of 41 SECTION II-THE CITY'S RESPONSIBILITIES A. The CITY shall compensate the CHAMBER for services rendered to CITY as part of the Project $25,000 in two payments of$12,500 each, one in January 2021 and one in August 2021. B. The CITY understands that the CHAMBER will seek an extension of this Contract for 2022 at the same amount as stated above, which will be subject to CITY approval. The CITY understands that without approval of the program by the CITY, the program will cease to operate. C. The CITY requests that any future requests for extension of this Contract for 2022 or beyond be made to CITY by June 15, 2021 to be reviewed for recommendation for inclusion into the CITY annual EDA budget. Requests should be directed in writing to the Director, Planning and Development Department; City Hall, 485 Gorman Street, Shakopee, Minnesota, 55379. SECTION III - TERMS AND CONDITIONS A. Term. This Contract shall commence January 1, 2021 and be in effect until December 31, 2021. B. Default. If CHAMBER fails to perform any of the provisions of this Contract or so fails to administer the services detailed in Exhibit 1, attached hereto, in such a manner as to endanger the performance of the Contract, this shall constitute default. Unless CHAMBER's default is excused by the CITY, the CITY may, upon written notice, immediately cancel this Contract or exercise any other rights or remedies available to the CITY under this Contract or law. C. Liability. The CITY shall have no duty or obligation hereunder other than to take such specific actions as are required of it from time to time by the provisions of this Contract and it shall incur no liability hereunder or in connection herewith for anything whatsoever other than any liability resulting from its own gross negligence or willful misconduct or unlawful acts or omissions. The only duties and responsibilities of the CITY shall be the duties and obligations specifically set forth in this Contract. D. Indemnification. CHAMBER shall indemnify, hold harmless and defend the CITY from and against any and all losses, claims, liabilities, and reasonable expenses, including the reasonable fees of its counsel, specifically including in-house counsel fees, which it may suffer or incur in connection with the performance of any duties and obligations under this Contract, except for those losses, claims, liabilities and expenses resulting solely and directly from the CITY'S own gross negligence, willful misconduct, or unlawful act or omission. All indemnification obligations shall survive termination, expiration or cancellation of this Contract. CITY shall indemnify, hold harmless and defend the CHAMBER from and against any and all losses, claims, liabilities, and reasonable expenses, including the reasonable fees of its counsel, specifically including in-house counsel fees, which it may suffer or incur in connection with the performance of any duties and obligations under this Contract, except for those losses, claims, liabilities and expenses resulting solely and directly from the CHAMBER'S own gross Page 32 of 41 negligence, willful misconduct, or unlawful act or omission. All indemnification obligations shall survive termination, expiration or cancellation of this Contract. E. Contingencies. This Contract is expressly contingent upon the CITY approving a budget allocating the funds specified herein for the purpose stated herein. In the event, for any reason, funds are not included in the approved CITY budget and available for expenditure for this Contract, then this Contract shall be null and void without any obligation by the CITY or CHAMBER. F. Termination. Either party may terminate this agreement upon providing 90 days written notice to the other party. Due to the fixed costs of starting and managing this program, regardless of the timing of termination by either party, any payments made to the CHAMBER by the CITY will not be refunded. G. Voluntary and Knowing Action. The PARTIES, by executing this Contract, state that they have carefully read this Contract and understand fully the contents thereof; that in executing this Contract they voluntarily accept all terms described in this Contract without duress, coercion, undue influence, or otherwise, and that they intend to be legally bound thereby. H. Authorized Signatories. The PARTIES each represent and warrant to the other that (1) the persons signing this Contract are authorized signatories for the entities represented, and (2) no further approvals, actions or ratifications are needed for the full enforceability of this Contract against it; each party indemnifies and holds the other harmless against any breach of the foregoing representation and warranty. I. Notices. The PARTIES' representatives for notification for all purposes are: THE CITY: Bill Reynolds, City Administrator 485 Gorman StreetShakopee, MN 55379 (952) 233-9311 breynolds@shakopeemn.gov Michael Kerski, Director, Planning & Development mkerski@shakopeemn.gov CHAMBER: Tim Zunker, Interim President 1801 East County Road 101 Shakopee, MN 55379 (952)445-1660 tzunker@shakopee.org Any notice provided for or permitted under this Contract, unless otherwise provided herein, will be treated as having been received (a) when delivered personally, (b) when sent by confirmed facsimile or (c) three (3) days following when sent by certified mail, to the party to be notified, at the address set forth below, or at such other place of which the other party has been notified in Page 33 of 41 accordance with the provisions of this paragraph. Such notice will be treated as having been received upon actual receipt if actual receipt occurs earlier than as provided in clauses (a) through (c) hereof. J. Independent Contractor Status. CHAMBER at all times and for all purposes hereunder, shall be an independent contractor and is not an employee of the CITY or EDA for any purpose. The CITY acknowledges that no withholding or deduction for State or Federal income taxes, FICA, FUTA, or otherwise, will be made from the payments due CHAMBER, and that it is CHAMBER's sole obligation to comply with the applicable provisions of all Federal and State tax laws. CHAMBER shall at all times be free to exercise initiative, judgment and discretion as to how to best perform or provide services identified herein. CHAMBER is responsible for hiring sufficient workers to perform the services/duties required by this Contract, withholding their taxes and paying all other employment tax obligations on their behalf. H. Subcontracting. CHAMBER shall not enter into any subcontract for performance of any services contemplated under this Contract without the prior written approval of the CITY. CHAMBER shall be responsible for the performance of all subcontractors and/or sub- consultants. I. Assignment. This Contract may not be assigned by either Party without the written consent of the other Party. J. Modifications/Amendment. Any alterations, variations, modifications, amendments or waivers of the provisions of this Contract shall only be valid when they have been reduced to writing, and signed by authorized representative of the CITY and CHAMBER. K. Records-Availability and Retention. Pursuant to Minn. Stat.§ 16C.05, subd. 5, CHAMBER agrees that the CITY, the State Auditor, or any of their duly authorized representatives at any time during normal business hours and as often as they may reasonably deem necessary, shall have access to and the right to examine, audit, excerpt, and transcribe any books, documents, papers, records, etc., which are pertinent to the accounting practices and procedures of CHAMBER and involve transactions relating to this Contract. CHAMBER agrees to maintain these records for a period of six years from the date of termination of this Contract. L. Force Majeure. The PARTIES shall each be excused from performance under this Contract while and to the extent that either of them are unable to perform, for any cause beyond its reasonable control. Such causes shall include, but not be restricted to fire, storm, flood, earthquake, explosion, war, total or partial failure of transportation or delivery facilities, raw materials or supplies, interruption of utilities or power, and any act of government or military authority. In the event either party is rendered unable wholly or in part by force majeure to carry out its obligations under this Contract then the party affected by force majeure shall give written notice with explanation to the other party immediately. M. Compliance with Laws. CHAMBER shall abide by all Federal, State and local laws, statutes, ordinances, rules and regulations now in effect or hereinafter adopted pertaining to this Contract or to the facilities, programs and staff for which CHAMBER is responsible. N. Covenant against Contingent Fee. CHAMBER warrants that it has not employed or retained any company or person, other than a bona fide employee working solely for CHAMBER to solicit or secure this Contract, and that it has not paid or agreed to pay any company or person, other Page 34 of 41 than a bona fide employee, any fee, commission, percentage, brokerage fee, gift or any other consideration, contingent upon or resulting from award or making of this Contract. O. Covenant against Vendor Interest. CHAMBER warrants that it is not employed by any vendor of equipment or service provider that could result in a commission, percentage, brokerage, or contingent fee as a result of CHAMBER association with the CITY. P. Non-Discrimination. The provisions of any applicable law or ordinance relating to civil rights and discrimination shall be considered part of this Contract as if fully set forth herein. Q. Interest by EDA or City Officials. No elected official, officer, or employee of the CITY or EDA shall during his or her tenure or employment and for one year thereafter, have any interest, direct or indirect, in this Contract or the proceeds thereof. R. Governing Law. This Contract shall be deemed to have been made and accepted in Scott County, Minnesota, and the laws of the State of Minnesota shall govern any interpretations or constructions of the Contract without regard to its choice of law or conflict of laws principles. S. No Partnership, Joint Venture, or Fiduciary Relationship. Nothing contained in this Contract shall be interpreted as creating a partnership, joint venture, or relationship of principal and agent between the CITY and CHAMBER. T. Data Practices. The PARTIES acknowledge that this Contract is subject to the requirements of Minnesota's Government Data Practices Act, Minnesota Statutes, Section 13.01 et seq. U. No Waiver. Any Party's failure in any one or more instances to insist upon strict performance of any of the terms and conditions of this Contract or to exercise any right herein conferred shall not be construed as a waiver or relinquishment of that right or of that Party's right to assert or rely upon the terms and conditions of this Contract. Any express waiver of a term of this Contract shall not be binding and effective unless made in writing and properly executed by the waiving Party. V. Severability. The invalidity or unenforceability of any provision of this Contract shall not affect the validity or enforceability of any other provision. Any invalid or unenforceable provision shall be deemed severed from this Contract to the extent of its invalidity or unenforceability, and this Contract shall be construed and enforced as if the Contract did not contain that particular provision to the extent of its invalidity or unenforceability. W. Entire Contract. These terms and conditions constitute the entire Contract between the PARTIES regarding the subject matter hereof. All discussions and negotiations are deemed merged in this Contract. X. Headings and Captions. Headings and captions contained in this Contract are for convenience only and are not intended to alter any of the provisions of this Contract and shall not be used for the interpretation of the validity of the Contract or any provision hereof. Y. Survivability. All covenants, indemnities, guarantees, releases, representations and warranties by any Party or PARTIES, and any undischarged obligations of the CITY and CHAMBER arising prior to the expiration of this Contract (whether by completion or earlier termination), shall survive such expiration. Page 35 of 41 SECTION VII - SIGNATURES IN WITNESS WHEREOF, the PARTIES have hereunto executed this document the day and year first above written. Chamber of Commerce as provider of Services: By: Date: President, Chamber of Commerce City of Shakopee By: Date: William Mars, Mayor By: Date: Bill Reynolds, City Administrator By: Date: Jody Brennan, EDA President Page 36 of 41 EXHIBIT 1 SCOPE OF SERVICES Subject to the terms of this Contract, CHAMBER shall perform the following services as its contractual obligation to the CITY: 1. CHAMBER will utilize the National Main Street Center's Transformational Strategies to focus on four Strategies for the betterment of the central business district that will include a focus on economic development and community engagement. a. Economic Vitality i. Build a diverse economic base ii. Catalyze smart new investment iii. Cultivate a strong entrepreneurship ecosystem b. Design i. Create an inviting, inclusive atmosphere ii. Celebrate historic character iii. Foster Accessible people-centered public space c. Promotion i. Market district's defining assets ii. Communicate unique features through storytelling iii. Support buy-local experience d. Organization i. Build leadership and strong organizational capacity ii. Ensure broad community engagement iii. Forge partnerships across sectors 2. CHAMBER will create a Steering Committee and additional committees as recommended by the National Main Street Center. The advisory Steering Committee will include two members from the City, including a City Staff member from the Economic Development Office and one City Council member. 3. CHAMBER will organizationally house and manage the Shakopee Main Street program. It will manage all personnel and financial activity of the program. 4. CHAMBER will publish an Annual Report in January of each year that will be distributed to the Shakopee Area Chamber of Commerce Board of Directors, the City of Shakopee, and the Main Street Steering Committee. 5. Shakopee Main Street annual program budget and scope of work will be submitted by the Main Street Director and Chamber President to the Chamber Board of Directors in accordance with all Chamber policies and procedures that govern the entire Chamber organization and also to the CITY. 6. The Main Street Director will present on an annual basis to the Shakopee City Council/EDA with scope of work and updates on the program. Page 37 of 41 EXHIBIT 2 CERTIFICATES OF REQUIRED INSURANCE COVERAGES [Certificates of Insurance attached hereto] Page 38 of 41 5.A. SHAKOPEE Shakopee Economic Development Authority March 1, 2022 FROM: Nate Reinhardt, Finance Director TO: EDA Commission Members Subject: EDA Bill List Policy/Action Requested: None Recommendation: Informational Only Discussion: Attached is a listing of bills for the EDA for the period 2/3/2022 to 3/1/2022. Payments are for general office supplies, attorney & professional service fees. Budget Impact: N/A ATTACHMENTS: o EDA Monthly Financial ❑ EDA Check Register Page 39 of 41 CO N N 9- vim, `p O N C Q u L CL g oc oc a> V O O O O Oci F" py �. 2 O H ao u cto N cocN u o C N CK N CC1M r..r oc 4.0 c W a� °° 0,0 co Q it> N 7 N ;D" Q C/) h�M 1I M � C _ IrSel Cl L 7 u — Nao Q o g N Q " "" � v rn CO CL a 0 z w c a c O .7) O �^ U 0_ o O `O z U W.4 Q ' Q O C LW N ... 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