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HomeMy WebLinkAbout2014 09-22 EDAPEDA MEETING City of Brooklyn Center September 22, 2014 AGENDA Call to Order—The EDA requests that attendees turn off cell phones and pagers during the meeting. A copy of the full City Council packet, including EDA (Economic Development Authority), is available to the public. The packet ring binder is located at the front of the Council Chambers by the Secretary. 2.Roll Call 3.Approval of Agenda and Consent Agenda—The following items are considered to be routine by the Economic Development Authority (EDA) and will be enacted by one motion. There will be no separate discussion of these items unless a Commissioner so requests, in which event the item will be removed from the consent agenda and considered at the end of Commission Consideration Items. a. Approval of Minutes 1. September 8, 2014 4.Commission Consideration Items a. Resolution Approving and Authorizing the Execution of Grant and Sub-Grant Agreements for Environmental Cleanup (Howe Fertilizer Site) Requested Commission Action: —Motion to adopt resolution. 5.Adjournment EDA Agenda Item No. 3a MINUTES OF THE PROCEEDINGS OF THE ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA REGULAR SESSION SEPTEMBER 8, 2014 CITY HALL - COUNCIL CHAMBERS 1.CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in Regular Session called to order by President Tim Willson at 8:41 p.m. 2.ROLL CALL President Tim Willson and Commissioners Kris Lawrence-Anderson, Lin Myszkowski, and Dan Ryan. Commissioner Carol Kleven was absent and excused. Also present were Executive Director Curt Boganey, Director of Business and Development Gary Eitel, Assistant City Manager/Director of Building and Community Standards Vickie Schleuning, City Attorney Charlie LeFevere, and Mary Mullen, TimeSaver Off Site Secretarial, Inc. 3.APPROVAL OF AGENDA AND CONSENT AGENDA Commissioner Myszkowski moved and Commissioner Lawrence-Anderson seconded approval of the Agenda and Consent Agenda, and the following item was approved: 3a. APPROVAL OF MINUTES 1.August ll,2014 Motion passed unanimously. 4.COMMISSION CONSIDERATION ITEMS 4a. RESOLUTION NO. 2014-16 APPROVING A DEVELOPMENT AGREEMENT (LUTHER HONDA AND TOYOTA DEALERSHIP FENCE PROJECT) Director of Business and Development Gary Eitel introduced the item, discussed the history, and stated the purpose of the proposed resolution. He stated the development agreement is possible as 2014 TIP revenue will allow the EDA to reimburse the developer. He added City staff recommends approval of the proposed development agreement with Luther Company LLLP. 09/08/14 -1- DRAFT Commissioner Ryan thanked Mr. Bitel for his review. He asked for clarification regarding the term "pooling". Mr. Eitel stated the City Council has the authority to "pool" the TIF funding in areas that are not TIF districts. Commissioner Lawrence-Anderson stated for the record that the Luther organization has been, and continues to be, committed to investing in the community. Mr. Eitel agreed, adding the Luther organization's financial investments in the community help to ensure the compatibility of commercial areas with residential use. Commissioner Myszkowski stated the September 8, 2014, staff memo indicates that a response has not been obtained from the owner of the Victoria Townhomes regarding the proposed masonry wall. Mr. Boganey stated the use of housing funds requires the establishment of benefit to property owners. Commissioner Ryan moved and Commissioner Myszkowski seconded to adopt RESOLUTION NO. 2014-16 Approving a Development Agreement (Luther Honda and Toyota Dealership Fence Project). Motion passed unanimously. 4b.RESOLUTION NO. 2014-17 CALLING FOR A PUBLIC HEARING REGARDING THE SALE OF LAND LOCATED AT 5331 MORGAN AVENUE NORTH Mr. Eitel introduced the item, discussed the history, and stated the purpose of the proposed resolution. He added City staff recommends the adoption of the resolution to schedule a public hearing for October 13, 2014. Commissioner Ryan moved and Commissioner Myszkowski seconded to adopt RESOLUTION NO, 2014-17 Calling for a Public Hearing Regarding the Sale of Land Located at 5331 Morgan Avenue North. Motion passed unanimously. 4c.RESOLUTION NO. 2014-18 CALLING FOR A PUBLIC HEARING REGARDING THE SALE OF LAND LOCATED AT 5800 BRYANT AVENUE NORTH Mr. Eitel introduced the item, discussed the history, and stated the purpose of the proposed resolution. He added City staff recommends the adoption of the resolution to schedule a public hearing for October 13, 2014. Commissioner Myszkowski moved and Commissioner Ryan seconded to adopt RESOLUTION NO. 2014-18 Calling for a Public Hearing Regarding the Sale of Land Located at 5800 Bryant Avenue North. 09/08/14 -2- DRAFT Motion passed unanimously. 4d.RESOLUTION NO. 2014-19 CALLING FOR A PUBLIC HEARING REGARDING THE SALE OF LAND LOCATED AT 5338 LOGAN AVENUE NORTH Mr. Eitel introduced the item, discussed the history, and stated the purpose of the proposed resolution. He added City staff recommends the adoption of the resolution to schedule a public hearing for October 13, 2014. Commissioner Ryan moved and Commissioner Lawrence-Anderson seconded to adopt RESOLUTION NO. 2014-19 Calling for a Public Hearing Regarding the Sale of Land Located at 5338 Logan Avenue North. Motion passed unanimously. 4e.RESOLUTION NO. 2014-20 CALLING FOR A PUBLIC HEARING REGARDING THE SALE OF LAND LOCATED AT 5400 BRYANT AVENUE NORTH Mr. Eitel introduced the item, discussed the history, and stated the purpose of the proposed resolution. He added City staff recommends the adoption of the resolution to schedule a public hearing for October 13, 2014. Commissioner Myszkowski moved and Commissioner Lawrence-Anderson seconded to adopt RESOLUTION NO. 2014-20 Calling for a Public Hearing Regarding the Sale of Land Located at 5400 Bryant Avenue North. Motion passed unanimously. 5. ADJOURNMENT Commissioner Lawrence-Anderson moved and Commissioner Myszkowski seconded adjournment of the Economic Development Authority meeting at 9:12 p.m. Motion passed unanimously. 09/08/14 -3- DRAFT EDA Agenda Item No. 4a EDA TITEM MEMORANDUM DATE: September 22, 2014 TO: Curt Boganey, City Manager FROM: Gary Eitel, Director of Business & Development SUBJECT: Resolution Approving and Authorizing the Execution of Grant and Sub Grant Agreements for Environmental Cleanup (Howe Fertilizer Site) Recommendation: It is recommended that the Economic Development Authority consider approval/adoption of the Resolution Approving and Authorizing the Execution of Grant and Sub Grant Agreements for Environmental Cleanup (Howe Fertilizer Site) Background: On April 28, 2014, the Economic Development Authority adopted the following resolutions associated with grant applications for the proposed environmental remediation (soils cleanup) of the industrial property located at 4821 Xerxes Avenue North (former Howe Fertilizer Site): o Resolution No.2014-05, A Resolution Authorizing the Economic Development Authority of Brooklyn Center, Minnesota to Apply for a Contamination Cleanup Grant from the Minnesota Department of Employment and Economic Development. o Resolution No. 2014-06, A Resolution Authorizing the Submission of a Grant Application to the Metropolitan Council for the Tax Base Revitalization Account. o Resolution No. 2014-07, A Resolution Approving an Application for a Hennepin County Environmental Financial Grant. On June 24, 2014, the Hennepin County Board approved the Environmental Financial Grant (ERF) application in the amount of $440,000 with conditions that included the necessary approval letters from the Minnesota Department of Agriculture (MDA) and the Minnesota Pollution Control Agency (MPCA. The grant applications submitted for DEED's Contamination Cleanup Grant ($610,000) and the Metropolitan Council's Tax Base Revitalization Account (400.000) were deemed premature and/or incomplete for their consideration until the necessary MDA and MPCA approval letters were available. The City and the developer were advised to resubmit an application for the next round of grant funding (November 1st application deadline). On August 28, 2014, the Minnesota Department of Agriculture (MDA) sent a notice of their approval of the Remedial Investigation Report/Corrective Action Plan for the Howe Agricultural Chemical Incident Investigation to the ConAgra, Syngenta, and their environmental consultants. Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust On September 4, 2014, the Minnesota Pollution Control Agency (MPCA) provided a letter to Paul Hyde, President of MBC II LLC, confirming their approval of modifications to its 2010 conditional approval of a Response Action Plan for Non-Ag Substances, as specified in Braun Intertec's report entitled "Response Action Plan Modification Former Howe Chemical/Fertilizer Site", dated April 3, 2014.. The modifications were generally referenced as the approach to soil cleanup being changed from excavating and re-compacting the Non Ag Substances and placing a building on top of them, to excavations and removal of the Non Ag Substances incidental to the implementation of the MDA approved RAP. On September 10, 2014, the developer and his environmental consultant, Braun Intertec, met with representatives from Hennepin County, Metropolitan Council and City Staff to discuss the following: • options on moving forward with the Cleanup Action Plan to complete the approved field work by October 27, 2014 as specified in the Ag. Departments approval letter; • submittal of new applications for DEED' s and Metro Council's fall grant programs (November 1St deadline); and • strategies on the use of Hennepin County's ERE grant funds and work activities that would either be eligible for reimbursement through DEED's grant program or deferred until January 2015 to be eligible for Metro Council's grant program. At this meeting, the developer indicated that he has a prospective tenant for 40.000 sq.fl. of this future 60,000 sq.ft. industrial building that requires a 2nd quarter 2015 occupancy date. The developer will be preparing new grant applications for the EDA' s consideration in October and staff is investigating the possible options on the use of TIF 4, a soils correction district, for possible gap financing to expedite the cleanup actions. Attached for your reference is a copy of the April 14, 2014 EDA memorandum which identified the previous grant applications and cleanup plan involving the removal of an estimated 15,000 cu.yds. of contaminated soils (10,000 cu.yds. on the Howe Site and 5,000 cu.yds. on the adjacent railroad property. Hennepin County's Environmental Response Fund Grant Agreement with the EPA of Brooklyn Center and Sub Grant Agreement between the EPA of Brooklyn Center and MBC II, LLC. The City Attorney has reviewed Hennepin County's Grant Agreement which establishes the terms and conditions for the distribution of a sum not to exceed $440,000 for expenses incurred in performing eligible work activities associated with the Corrective Action Plan and Response Action Plan as described in the grant application and identified in this agreement. The City Attorney has also prepared the attached Sub Grant Agreement between the Brooklyn Center Economic Development Authority and MBC II, LLC which contractually provides for the Sub-grantee to take on certain duties and responsibilities of the EDA within the County's Grant Agreement in consideration of receiving funds provided in the Grant Agreement. I','Jissio,i: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public (rust 11 , 151k'1 10-3 Oki The attached resolution approves and authorizes the execution of the Grant Agreement with Hennepin County and the Sub Grant Agreement with MBC II, LLC/ Budget Issues: The EDA's budget impact associated with Environmental Cleanup Grants has been limited to the staff time necessary to monitor the grant programs; process payment requests to MBC II, LLC's for performing grant related work; and maintaining the required financial records for the grant programs!. Strategic Priorities: e Focused Redevelopment Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION APPROVING AND AUTHORIZING THE EXECUTION OF GRANT AND SUB-GRANT AGREEMENTS FOR ENVIRONMENTAL CLEANUP (HOWE FERTILIZER SITE) WHEREAS, Hennepin County (the "County") has approved the application of the EDA for a grant to be used for the implementation of a Corrective Action Plan and Response Action Plan, associated consulting activities and agency fees at the former Howe Fertilizer plant at 4821 Xerxes and 4823-1/2 Osseo Road in Brooklyn Center (the "Howe Fertilizer Site"); and WHEREAS, the County has submitted for approval and execution a proposed agreement for such grant entitled "Environmental Response Fund Grant Agreement Between the City of Brooklyn Center Economic Development Authority and Hennepin County Department of Environmental Services - Contract No. Al 40836 (the "Grant Contract"); and WHEREAS, MBC II LLC, the owner of the Howe Fertilizer Site has proposed to enter into a sub-grant agreement for the Grant Contract under which MBC II LLC, as sub- grantee, will assume the responsibilities of the EDA under the Grant Contract (the "Sub-Grant Agreement"); and WHEREAS, the EDA has determined that it is reasonable and appropriate and in the best interests of the public that the EDA enter into such Grant Contract with Hennepin County and such Sub-Grant Agreement with MBC II LLC. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center: That the Grant Contract and the Sub-Grant Agreement are approved. 2. The President and Executive Director are authorized and directed to execute the Grant Contract and Sub-Grant Agreement. The Executive Director is authorized and directed to take any and all additional steps necessary or convenient to effect the terms of the Grant Contract and the Sub-Grant Agreement. September 22. 2014 PresidentDate The motion for the adoption of the foregoing resolution was duly seconded by Commissioner and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. II11 Contract No. A140836 ENVIRONMENTAL RESPONSE FUND GRANT AGREEMENT BETWEEN THE CITY OF BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY AND HENNEPIN COUNTY DEPARTMENT OF ENVIRONMENTAL SERVICES This Agreement is between the County of Hennepin, State of Minnesota ("County") at A2300 Government Center, Minneapolis, MN 55487 by its Department of Environmental Services ("Department") and the City of Brooklyn Center Economic Development Authority ("Grantee") with offices located at 6301 Shingle Creek Parkway, Brooklyn Center, Minnesota, 55430. Grantee has submitted an application to the County for a grant to be used for implementation of the Corrective Action Plan and Response Action Plan, associated consulting activities and agency fees at the Former Howe Fertilizer project site located at 4821 Xerxes and 4823-1/2 Osseo Road in Brooklyn Center. The application is incorporated into this Agreement by reference. The parties agree as follows: 1.GRANT AMOUNT AND COMPLETION The County shall grant to Grantee a sum not to exceed Four Hundred Forty Thousand and Four Hundred dollars ($440,400.00) ("ERF Grant")which funds shall be only for expenses incurred in performing activities specified in the Application and as may be further described in Exhibit A to this Agreement or as approved by the County. Approved activities as may be described in Exhibit A and in the application, attached as Exhibit B, are referred as the "Project". Administrative costs incurred by Grantee are not eligible for reimbursement. Exhibits A and B are attached and incorporated by this reference. Grantee shall complete the Project within two (2) years of execution of this Agreement and within the terms stated herein. Any material change in the scope of the Project, including time schedule and budget, must be approved in writing by the County. Upon approval by the County Administrator, the duration of this Agreement may be extended for up to twelve (12) months. Funds made available pursuant to this Agreement shall be used only for expenses incurred in performing such purposes and activities described in the Application and this Agreement. 2.ACCOUNTING AND RECORD KEEPING For all expenditures of funds made pursuant to this Agreement, Grantee shall keep financial records including properly executed contracts, invoices, and other documents sufficient to evidence in proper detail the nature and propriety of the expenditures. Accounting methods shall be in accordance with generally accepted accounting principles. The County, 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 Grantee and involve transactions relating to this Agreement. Such materials shall be maintained and such access and rights shall be in force and effect during the period of the Agreement and for six (6) years after its termination or cancellation. 3. PAYMENT/DISBURSEMENT SCHEDULE County will disburse funds to Grantee pursuant to this Agreement, based on a payment request form provided by the County, submitted by Grantee and approved by the County. Payment requests can be submitted once per month and must be accompanied by supporting invoices that relate to activities in the approved Project budget. Subject to verification of adequacy of a written disbursement request and approval of consistency with this Agreement, the County will disburse the requested amount to Grantee within six (6) weeks after receipt of a written disbursement request. The final request for disbursement must be submitted within six (6) months of the expiration date of this Agreement. 4.REPORTING Grantee shall submit to the County a report on the distribution of funds and the progress of the Project covered from the date of the grant award through June 30 of each year. The reports must be received by the County no later than July 25 of each year. The report shall identify specific goals listed in the application and quantitatively measure the progress of such goals. Reporting forms will be provided by the County. In addition, the required documentation listed in Exhibit A should be supplied as it becomes available. 5.CONTRACTS Grantee shall include in any contract, provisions that require contractors to comply with all applicable State and Federal laws and regulations regarding employment and workplace safety. In accordance with Hennepin County's policies against discrimination, Grantee shall not exclude any person from full employment rights or participation in or the benefits of any program, service, or activity on the grounds of race, color, creed, religion, age, sex, disability, marital status, sexual orientation, public assistance status, or national origin; and no person who is protected by applicable Federal or State laws, rules, or regulations against discrimination shall be otherwise subjected to discrimination. Public Grantees and any contractors or subcontractors performing services as part of this Agreement shall follow that public Grantee's Affirmative Action policy against discrimination. 6.TERMINATION, CANCELLATION AND ASSIGNMENT This Agreement may be canceled by the County upon sixty (60) days written notice to Grantee without cause. In the event of such cancellation, Grantee shall be entitled to payment, determined on a pro rata basis, for work or services satisfactorily performed up to the effective date of such cancellation. If the County finds that there has been a failure to comply with the provisions of this Agreement, that reasonable progress has not been made toward commencement or completion of the assessment and/or clean-up activities specified in the Application and this Agreement, notwithstanding any other provisions of this Agreement to the contrary and after written notice and reasonable opportunity to cure, the County may refuse to disburse additional funds and/or require the return of all or part of the funds already disbursed, to the extent such funds were used for purposes other than activities contemplated by this Agreement. If the County finds that there has been a violation of any state, federal or local law, the County may upon written notice immediately cancel this Agreement in its entirety and may withhold or delay payment. In the event of a decision to withhold or delay payment, the County shall furnish prior written notice to Grantee specifically identifying the reason for withholding or delaying such payment. This Agreement may not be assigned without the prior written consent of the County. 7.INDEPENDENT CONTRACTOR Grantee shall select the means, method, and manner of performing the Project. Nothing is intended or should be construed in any manner as creating or establishing the relationship of co-partners between the parties or as constituting Grantee as the agent, representative, or employee of the County for any purpose. Grantee shall remain an independent contractor with respect to all services and activities performed under this Agreement. Any personnel of Grantee or other persons while engaged in the performance of any work or services required by Grantee under this Agreement will have no contractual relationship with the County, and will not be considered employees of the County. The County shall not be responsible for any claims that arise out of employment or alleged employment under the Minnesota Economic Security Law or the Workers' Compensation Act of the State of Minnesota on behalf of any personnel, including, without limitation, claims of discrimination against Grantee, its officers, agents, contractors, or employees. Grantee shall defend, indemnify and hold harmless the County, its officials, officers, agents, and employees from all such claims irrespective of any determination of any pertinent tribunal, agency, board, commission, or court. Such personnel or other persons shall neither require nor be entitled to any compensation, rights, or benefits of any kind whatsoever from the County, including, without limitation, tenure rights, medical and hospital care, sick leave, Workers' Compensation, Re-employment Compensation, disability, severance pay, and retirement benefits. 8.INDEMNIFICATION Grantee agrees to defend, indemnify and hold harmless, the County, its officials, officers, agents, volunteers and employees from any liability, claims, causes of action, judgments, damages, losses, costs, or expenses, including reasonable attorney's fees, resulting directly or indirectly from any act or omission of Grantee, its contractors or subcontractors or anyone directly or indirectly employed by them, and/or any party that directly or indirectly benefits from the activities specified in this Agreement, and/or anyone for whose acts and/or omissions they may be liable in the performance of the activities specified in this Agreement and against all loss by reason of the failure of Grantee to perform any obligation under this Agreement. 9.INSURANCE In order to protect the County and those listed above under the indemnification provision, Grantee agrees at all times during the term of this Agreement and beyond such term when so required, to have and keep or cause to have and be kept in force, and to cause all contractors to do likewise, the following insurance coverages under either a purchased insurance or self-insurance program: Commercial General Liability on an occurrence basis with Contractual Liability Coverage: Limits General Aggregate $2,000,000 Products-Completed Operations Aggregate 2,000,000 Personal and Advertising Injury 1,500,000 Each Occurrence - Combined Bodily Injury and Property Damage 1,500,000 2. Automobile Liability - Combined single limit each occurrence for 1,500,000 bodily injury and property damage covering owned, non-owned, and hired automobiles. Workers' Compensation and Employer's Liability: a.Workers' Compensation Statutory If the contractor is based outside the State of Minnesota, coverage must apply to Minnesota laws. b.Employer's Liability. Bodily Injury by: Accident— Each accident 500,000 Disease - Policy Limit 500,000 Disease - Each Employee 500,000 Professional Liability - Per Claim 1,500,000 2Aggregate ,000,000 The insurance must be maintained continuously for a period of two years after the termination of this Agreement. Grantee shall require that any independent contractors rendering assessment and/or clean-up activities under this Agreement furnish certificates of insurance to Grantee of the insurance coverages listed above, and provide updated certificates as coverages expire. An umbrella or excess policy over primary liability coverages is an acceptable method to provide the required insurance limits. The above establishes minimum insurance requirements. It is the sole responsibility of Grantee to determine the need for and to procure additional insurance which may be needed in connection with this Agreement. Grantee and their contractors shall not commence work until they have obtained required insurance and filed with the Grantee properly executed Certificates of Insurance establishing compliance. The certificate(s) must name the Grantee as the certificate holder and Hennepin County as an additional insured for the commercial general liability coverage(s) for all operations covered under the Agreement. Grantee shall immediately notify County of any cancellations or reduction of insurance coverage. Grantee shall provide copies of insurance certificates to County upon request. If Grantee fails to furnish proof coverages, if requested by the County, the County may withhold payments and/or pursue any other rights or remedy allowed under the contract, law, equity, and/or statute. 10.MERGER AND MODIFICATION It is understood and agreed that the entire Agreement between the parties is contained herein and that this Agreement supersedes all oral agreements and negotiations between the parties relating to the subject matter hereof. All items referred to in this Agreement are incorporated or attached and are deemed to be part of this Agreement. Any alterations, variations, modifications or waivers of provisions of this Agreement shall only be valid when they have been reduced to writing as an amendment to this Agreement signed by the parties. 11.MINNESOTA LAWS GOVERN The Laws of the State of Minnesota shall govern all questions and interpretations concerning the validity and construction of this Agreement and the legal relations between the parties and performance under it. The appropriate venue and jurisdiction for any litigation will be those courts located within the County of Hennepin, State of Minnesota. Litigation, however, in the federal courts involving the parties will be in the appropriate federal court within the State of Minnesota. If any provision of this Agreement is held invalid, illegal or unenforceable, the remaining provisions will not be affected. 12.ACKNOWLEDGMENTS The Grantee shall acknowledge the financial assistance provided by the County in promotional materials, press releases, reports and publications relating to the Project activities described in Exhibit A which are funded in whole or in part with the grant funds. The acknowledgment should contain the following language: Financing for this project was provided in part by the Hennepin County Environmental Response Fund. Until the Project activities funded by this Agreement are completed, the Grantee shall ensure the above acknowledgment language, or alterative language approved the County, is included on all signs located at the Project or construction sites that identify Project funding partners or entities providing financial support for the project. Until the Project activities funded by this Agreement are completed and for one year after that date, the Grantee shall provide advance notice to the County, including an invitation to the appropriate County Commissioner's office, of any public events related to the Project. 13.USE OF ERF GRANT AS A LOAN [include only for municipal grants An ERF Grant from County to Grantee may not be disbursed by Grantee to any entity as a loan. 4 COUNTY BOARD AUTHORIZATION GRANTEE, having signed this agreement, and the Hennepin County Board of Commissioners having duly authorized this agreement on the24'1' of June, 2014, and pursuant to such approval, the proper County officials having signed this agreement, the parties hereto agree to be bound by the provisions herein set forth. Reviewed by the County Attorney's COUNTY OF HENNEPIN Office STATE OF MINNESOTA By: Assistant County Attorney Chair of Its County Board Date: ATTEST: Deputy/Clerk of County Board Date: By: David Hough, County Administrator Date: By: Assistant County Administrator, Public Works Recommended for Approval Date: By: Director, Department of Environmental Services Date: GRANTEE Grantee warrants that the person who executed this Agreement is authorized to do so on behalf of GRANTEE as required by applicable articles, bylaws, resolutions or or di nances .* Name: CITY OF BROOKLYN CENTER EDA By: Tim Willson, President Date: *GRANTEE shall submit applicable documentation (articles, bylaws, resolutions or ordinances) that confirms the signatory's delegation of authority. This documentation shall be submitted at the time Grantee returns the Agreement to the County. Documentation is not required for a sole proprietorship. Exhibit A Former Howe Fertilizer Project Summary: The project site is a 5.1-acre property that was formerly occupied by the Howe Fertilizer company. The property is owned by the developer, MBC II LLC, who plans to construct a 60,000 square foot office building. The site is currently occupied by three buildings in various stages of disrepair that have been vacant for a decade. The site buildings were constructed in the 1950s. Historical uses included manufacturing, bulk petroleum storage, and most notably the production, storage, and distribution of agricultural chemicals from the 1940s until 2006. A 1979 fire resulted in the release of various agricultural chemicals. Several investigations have been conducted at the site since 2006. The site's contaminants of concern are polynuclear aromatic hydrocarbons (PAH5), volatile organic compounds (VOCs), metals (mercury, arsenic, chromium, and silver), diesel range organics (DRO), various pesticides and herbicides, and dioxins. The Corrective Action Plan (CAP) and Response Action Plan (RAP) include excavation and onsite soil reuse under a parking lot and a building cap. The applicant requests ERF assistance for soil remediation including contaminated soil excavation, transportation, and disposal; onsite soil reuse; clean fill placement, vapor mitigation design and installation; well abandonment; groundwater monitoring costs, associated consulting activities and agency fees. The applicant requested a modification to include demolition and abatement costs. The following costs are based on a budget submitted by Grantee. Modifications must be approved in writing by the County. Approved Budget for the Former Howe Fertilizer Project Site: Activities relating to soil demolition and abatement, remediation including contaminated soil excavation, transportation, and disposal; onsite soil reuse; clean fill placement; vapor mitigation design and installation; well abandonment; groundwater monitoring costs; associated consulting activities; and agency fees. 44Q,40O.00 Total: $440,400.00 Required Documentation to be Submitted to Hennepin County: Corrective Action Plan (CAP) and Response Action Plan (RAP) Implementation Reports Demolition notification documentation Building demolition disposal documentation Asbestos abatement disposal documentation and clearance reports if required, (Include a spread sheet matching manifest, load tickets, unit rates, and final weights, if applicable) Vapor Mitigation Design and Specifications, and installation documentation (installation documentation can be included in the CAP/RAP Implementation report) Contaminated Fill/Soil disposal documentation (unit rates, one manifest per truck per load, and weight/load tickets). Include a spread sheet matching manifest, load tickets, and final weights Clean fill documentation MDA and MPCA Approval Letters Consultant/Contractor Invoices (include time period covered by invoice and documentation supporting expenses, including subcontractor and analytical invoices - include unit rates and quantities, subcontractor markup limited to 10% or less) Agency Invoices Annual Project Progress/Summary Report(s) A-I Exhibit B ERF Application Former Howe Fertilizer B-i SUB-GRANT AGREEMENT THIS AGREEMENT is made as of this day of , 2014, by and between the Brooklyn Center Economic Development Authority, a public body corporate and politic under the laws of Minnesota (the "Grantee"), and MBC II, LLC, a Minnesota limited liability company ("Sub-grantee"): WHEREAS, Grantee has entered into a grant contract with the County of Hennepin by its Department of Environmental Services ("County"), entitled "Environmental Response Fund Grant Agreement between the City of Brooklyn Center Economic Development Authority and Hennepin County Department of Environmental Services" Contract No. A140836 (the "Grant Contract"), a copy of which is attached hereto as Exhibit One, and hereby made a part hereof; and WHEREAS, the Grant Contract provides that the County shall grant to Grantee a sum not to exceed Four Hundred Forty Thousand Four Hundred and No/100 Dollars ($440,400.00), which funds shall be used to perform the duties and tasks specified in the Grant Contract; and WHEREAS, the Grantee will be passing the funds provided pursuant to the Grant Contract through to Sub-grantee; and WHEREAS, the Grantee and Sub-grantee have agreed for Sub-grantee to assume certain of the duties and responsibilities of Grantee under the Grant Contract in consideration of receiving funds provided for in the Grant Contract and subject to the terms, conditions, and limitations set forth therein. NOW, THEREFORE, in consideration of the premises and the mutual promises set forth herein, the parties hereto covenant and agree as follows: Grantee will forward to Sub-grantee funds received under the Grant Contract upon receipt and upon the continuing compliance by Sub-grantee with its obligations hereunder and under the Grant Contract. Grantee shall not be obligated to reimburse Sub-grantee for any amounts in excess of funds received by Grantee under the Grant Contract. If the County requires reimbursement of funds advanced under the Grant Contract, Sub-grantee will promptly reimburse such funds to Grantee upon demand. 2. Sub-grantee will perform and satisfy all obligations of Grantee under the Grant Contract, except those that, by their nature, can only be performed by Grantee. Sub-grantee will provide any information or assistance requested by Grantee for the purpose of satisfying the obligations of the Grant Contract that, by their nature, can only be performed by Grantee. Specifically, but without limiting the foregoing, Sub-grantee will perform all of the following: 1 449963v1 BR305-1 (a)Sub-grantee shall keep and maintain all records required by section 2 of the Grant Contract. (b)Sub-grantee shall submit payment request forms in accordance with section 3 of the Grant Contract. (c)Sub-grantee shall submit the reports required by section 4 of the Grant Contract. (d)Sub-grantee shall comply, and shall require its contractors and subcontractors to comply, with all requirements of sections 5, 9 and 12 of the Grant Contract. 3.Sub-grantee may neither assign nor transfer any rights or obligations under this Agreement without the prior consent of the Grantee and an Assignment Agreement executed and approved by the parties. 4.Any amendment to this Agreement must be in writing and will not be effective until it has been executed and approved by the parties. 5.If Grantee fails to enforce any provisions of this Agreement, such failure does not waive the provision or Grantee's right to enforce it. 6.This Agreement contains all negotiations and agreements between Grantee and Sub-grantee. No other understanding, agreements or understandings regarding the Grant Contract, or this Agreement, may be used to bind either party. 7.Sub-grantee will defend, indemnify, save, and hold harmless the County and Grantee, their officers, agents, and employees, from any claims or causes of action, including attorney's fees incurred by Grantee, arising from the performance of this Agreement or failure to perform any obligation under this Agreement by Sub-grantee, or its officers, agents or employees. 8.Sub-grantee's books, records, documents and accounting procedures and practices relevant to this Agreement are subject to examination by the County, the State of Minnesota and/or the state auditor or legislative auditor, as appropriate, for a minimum of six (6) years from the end of this Agreement. 9.Sub-grantee shall comply with applicable provisions of the Minnesota Government Data Practices Act, Minnesota Statutes, Chapter 13. If Sub-grantee receives a request to release data referred to in this paragraph, Sub-grantee must immediately notify Grantee. Grantee will give Sub-grantee instructions concerning the release of the data to the requesting party, prior to such release. 10.Sub-grantee certifies that it is in compliance with Minnesota Statutes, Section 176.181, Subd, 2, pertaining to workers' compensation insurance coverage. 2 449963v1 BR305-1 11.Any publicity regarding the subject matter of this Grant Agreement must identify the County as the sponsoring agency and must not be released without prior written approval from the County's authorized representative as specified in the Grant Contract. Publicity shall include information identified in Paragraph 12 of the Grant Contract. Sub-grantee must not claim that the County or Grantee endorses its products or services. 12.Sub-grantee shall select the means, method, and manner of performing the Project as defined in the Grant Contract. Nothing is intended or should be construed in any manner as creating or establishing the relationship of co-partners between the parties or as constituting Sub-grantee as the agent, representative, or employee of the Grantee for any purpose. Sub-grantee shall remain an independent contractor with respect to all services and activities performed under this Agreement. Any personnel of Sub-grantee or other persons while engaged in the performance of any work or services required by Sub-grantee under this Agreement will have no contractual relationship with the Grantee and will not be considered employees of the Grantee. The Grantee shall not be responsible for any claims that arise out of employment or alleged employment under the Minnesota Economic Security Law or the Workers' Compensation Act of the State of Minnesota on behalf of any personnel, including, without limitation, claims of discrimination against Sub- grantee, its officers, agents, contractors or employees. Sub-grantee shall defend, indemnify and hold harmless the Grantee and the County, their officials, officers, agents, and employees from all such claims irrespective of any determination of any pertinent tribunal, agency, board, commission, or court. Such personnel or other persons shall neither require nor be entitled to any compensation, rights, or benefits of any kind whatsoever from the Grantee, including, without limitation, tenure rights, medical and hospital care, sick leave, Workers' Compensation, Re- employment Compensation, disability, severance pay, and retirement benefits. 13.The law governing the obligations of this Agreement and the venue for all legal proceedings associated therewith shall be in accordance with Paragraph 11 of the Grant Contract. 14.This Agreement is subject to termination in accordance with Paragraph 6 of the Grant Contract. 449963v1 BR305-1 IN WITNESS WHEREOF, the parties hereto have hereunto set their hands as of 2014. BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY By: Its President And by: Its Executive Director 4 449963v1 BR305-1 MBC II, LLC By: Its 449963v1 BR305-1 EDA ]ITEM MEMORANDUM DATE: April 28, 2014 TO: Curt Boganey, City Manager FROM: Gary Eitel, Business and Development Director )- SUBJECT: Consideration of Approval of Grant Applications for Contamination Cleanup of the Former Howe Chemical Site Located at 4821 Xerxes Avenue North in Brooklyn Center Recommendation: It is recommended that the Economic Development Authority of Brooklyn Center, Minnesota (EDA) consider approval of the following resolutions: A.Resolution Authorizing the Economic Development Authority of Brooklyn Center, Minnesota to Apply for a Contamination Cleanup Grant from the Minnesota Department of Employment and Economic Development. B.Resolution Authorizing the Submission of a Grant Application to the Metropolitan Council for the Tax Base Revitalization Account. C. Resolution Approving an Application for a Hennepin County Environmental Financial Grant. Background: This memorandum addresses the proposed environmental remediation and redevelopment of the industrial property located at 4821 Xerxes Avenue North in Brooklyn Center (the Site) and known as the former Howe Chemical Site. With regard to environmental remediation of the Site, the EDA is being asked to apply for grant funding to assist with cleanup of the Site by the new owner, MBC II, LLC (d/bla Hyde Development). The grant funds are awarded on a competitive basis from the Minnesota Department of Employment and Economic Development (DEED), Metropolitan Council and Hennepin County Department of Environmental Services. The grant mechanisms require that the EDA apply for the grant and be accountable for expenditure of the funds, but MBC II will manage and conduct all the cleanup activities through private contractors and consultants. Essentially, the EDA serves as a pass through of grant funds to MBC II, LLC. The EDA has previously approved the submittal of these 3 grant resolution on three prior occasions April 21, 2010; October 20, 2010; and April 25, 2011. The prior grant applications were determined to be ineligible, pending the necessary approvals by the Minnesota Department of Agriculture. The Department of Agriculture is currently in the process of reviewing the Remedial Investigation Report and Corrective Action Plan which may be completed in time for this grant cycle. Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust I M I k"A U I MY4 (I] 1I WJi Available Contamination Clean Up Grants: The resolutions to be considered by the EDA address three contamination cleanup grant programs. The programs are as follows: •° Department of Employment and Economic Development (DEED) The Minnesota Contamination Cleanup Grant Program was established in 1993 to clean up contaminated sites and convert contaminated property into a marketable asset. The Department of Employment and Economic Development (DEED) is the administering state agency for the grant program. The DEED grant requires a 25% local match which will be provided by MBC II, LLC (Hyde Development). + Metropolitan Council Tax Base Revitalization Account (TBRA Enacted by the Legislature in 1995, the Metropolitan Livable Communities Act designated the Metropolitan Council as the administrator of the Tax Base Revitalization Program. This program makes grants to clean-up contaminated land for subsequent redevelopment, job retention and job growth in areas that have lost some of their commercial industrial base. No local match is required. + Hennepin County Environmental Response Fund (ERF) and Environment al Protection Agency (EPA) Brownfield's Revolving Loan Fund Grants. Hennepin County makes environmental cleanup grants available through its Environmental Response Fund (ERF) grant program. These ERF grants can be used for assessment and or cleanup of contaminated sites located within Hennepin County. In addition to the ERE program, Hennepin County also manages the EPA Brownfield Revolving Loan Fund Grant Program. This is funded by the Federal EPA for the redevelopment of Brownfield's. A "brownfield" is defined as real property, the expansion, redevelopment, or reuse of which may he complicated by the presence of potential hazardous substance, pollutant or contaminant. The program was created by the 2002 Federal Brownfield's Law. No local match is required. Site History The Site at 4821 Xerxes Avenue North was a manufacturer and distributor of custom formulated agricultural fertilizers, insecticides, fungicides, and herbicides going back to 1940. A retail petroleum station was also located at the Site from approximately 1945 to 1970. The Site was owned for many years by the Howe family and operated under the names Howe, Inc. and Howe Chemical Company. Around 1983, the facility was purchased by ConAgra Fertilizer Company, now known as United Agra Products (also known as UAP Distribution, Inc.). The Site operations that came after the Howe ownership included distribution of agricultural fertilizers. A major industrial incident occurred at the Site in 1979 when one of the buildings burned down. The building reportedly contained over 80 tons of 100 different types of pesticides and over 120 tons of bag and bulk fertilizers, all of which burned along with industrial equipment, electrical Iktissioi: Ensuring an attractive, clean, safe, inclusive community that enhances(inCes the quality of life for all people and preserves the public trust equipment, vehicles, maintenance chemicals, wood, metal, batteries, etc., stored within the building. The water used to fight the fire (estimated at 500,000 gallons) drained onto the Site's paved areas and soil where it pooled, as well as ran into storm water catch basins. Site soil and groundwater sampling and analysis subsequent to the fire were performed and elevated concentrations of agricultural chemicals were detected in both the Site soil and ground water. Following the fire, the State of Minnesota assumed control of the investigation and clean-up of the Howe site in Brooklyn Center and selected and implemented two cleanup steps. First, the removal of contaminated soil, ice and snow to agricultural land in Martin County, Minnesota; and second, the pumping of contaminated groundwater "down gradient" from the Howe facility. The second step also involved the State's decision not to further investigate or cleanup any soils on the Howe site itself. Soil excavation was ruled out since it was determined that the pesticides in the soil would eventually infiltrate into groundwater where they could be controlled or removed and because of the amounts present and hydro geological conditions, remedial action of the Howe site was not thought to be necessary. Current requirements for investigation and cleanup of contaminants on the Site suggest that the initial investigation and cleanup was not adequate. Subsequent to the 1979 fire and initial cleanup, the Site continued in operation as a fertilizer distribution operation. In 1986 the Crop Mate Company, which was a ConAgra affiliate, acquired the site. All Site operations were discontinued in 2006. In 2008, site and building plan approval was granted by the City to RER Acquisitions, LLC for a 50,000 sq. ft. office/warehouse facility. Over the past few years since 2008, RER has been working with the Department of Agriculture (DOA) and Minnesota Pollution Control Agency (MPCA) to establish which State agency had authority to provide oversight relative to the cleanup of The Site. The issue of agency oversight was resolved with the Department of Agriculture having the lead role in a coordinated cleanup program for the Howe Chemical Site Site Clean Up and Proposed Development RER (now known as MBC II, LLC) acquired the Howe site in April 2010 and has enrolled the property in the MPCA's Volunteer Investigation and Cleanup (VIC) program in order to proceed with required cleanup and redevelopment of the Site as per MPCA standards spelled out in work plans approved by the MPCA. RER had also been participating in the AG VIC program for cleanup of contaminants identified as agriculture related; however, RER!MBC II is no longer a participant in this voluntary program. Rather the Ag Department has been working with the Responsible Parties identified to have had agricultural products that stored on site. A mobile testing lab was set up at the site this winter and the Ag Department coordinated a thorough soils investigation of the Howe site and adjacent railroad property known to have been used in the former Howe Fertilizer operation. In addition to defining the volume of the contaminated soils on the Howe Site, the investigation found areas within the adjacent railroad property that had previously been used as disposal sites for the burying of agricultural products. Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust On March 7, 2014, Environmental Scientific, a consultant for the companies identified as the Responsible Parties, submitted a Remedial Investigation Report and Corrective Action Plan for the Howe Site and the adjacent railroad property to the MN Department of Agriculture. The plan specifically identified the perimeter and depth of several areas with levels of contaminated soils to be removed and properly disposed at an approved landfill. It is staff's understanding that approximately 15,000 cubic yards of contaminated soils, (10,000 cubic yards on the Howe site and 5,000 cubic yards on the railroad property) will need to be exported with clean soils imported to balance the grading plans for the planned industrial development of the site. On April 11, 2014, a meeting was held with the Paul Hyde and representatives of Hennepin County, Metropolitan Council, and DEED to review a proposed budget and potential funding sources to clean up the contaminated soils identified on the Howe Site. At this meeting Paul Hyde provided the following information relating to the Ag Department's determination of Responsible Parties and MBC II's relationship with these parties to achieve a coordinated clean up action plan for the Howe Site and adjacent railroad property: Several parties were identified as potentially responsible for contamination at the Site resulting from a fire in 1979 that destroyed a storage and maintenance building and released various pesticide or fertilizer products. After assuming responsibility for the investigation and cleanup of the fire releases, the state sued the Howe Chemical, Inc. and Howe Fertilizer, Inc. as well as Ciba Geigy Corporation, which stored products in the building. On March 6, 1986, the Hennepin County District Court, after settlement of the state's claims, dismissed all state claims against these parties, with prejudice. Subsequently, Howe Chemical Company, Inc. and Howe Fertilizer, Inc. were dissolved and no longer exist. The other parties operating at the former Howe property were the Sipe and Gray Oil Company, which ran a Texaco station and the Minneapolis Sewing Machine Company. These companies are no longer in existence. The Department of Agriculture made it clear in 2011 that it would not talk to MBC II with regards to its planned development or the cleanup of the Howe Site. Accordingly, in 2011 the successor to Howe Fertilizer (ConAgra) and Ciba Geigy (Syngenta) entered into an Environmental Remediation Agreement, whereby ConAgra and Syngenta would agree to serve as the liaison with the Department of Agriculture and MBC II, and would be responsible for paying for all costs of remediation on the Former Howe site. The dollar amounts identified from the various grant programs are as follows: • $580,000 from DEED contamination cleanup grant program. o $370,000 from Metropolitan Council Tax Base Revitalization Account (TBRA) program. • $407,734 from Hennepin County Environmental Response Fund and/or EPA Brownfield's Grant Program. $333,271 from Developer as a local match for investigation costs • $300,000 from the Developer to provide capping of The Site and also to meet the 25 percent local match funding required by the DEED grant program. o $50.000 from the 2010 DEED Investigation Grant • $50,000 from the 2011 Met Council Investigation Grant. Mission: Ensuring an attractive, clean, safe, inclusive community that enhances the quality of life for all people and preserves the public trust Attached for your reference are three exhibits illustrating the clean-up areas and the proposed budget prepared by MBC II for the Howe Site. At this time, the developer is pursuing the May l,'2014 Grant Applications with the expectations that Minnesota Agriculture Department will complete their review and provide their approval of the Remedial Investigation Report and Corrective Action Plan prior to the agencies finalizing their selection of candidates for this cycle of grant funds. The developer has indicated that a schedule similar to the 2012 soil correction and construction plans for their development of the former Lifetime Fitness Site would facilitate leasing plans to have the building ready for occupancy in December, 2014. Based on the preliminary leasing contacts, it is estimated that this project will result in the relocation of approximately 100 jobs to the City and the opportunity for the creation of an additional 20-30 new jobs. The City Council approved the initial industrial development plans in 2008 and in 2014, approved an amended to this Industrial PUD that enlarged the building from 51,000 square feet to 60,000 square feet. This office/warehouse building is planned to be identical in appearance to the building constructed by RER (Hyde) directly across Brooklyn Boulevard in Minneapolis. Budget Issues: There are no direct budget impacts to consider since Hyde Development will provide the local match for the DEED grant and the various grant agencies will provide all funding for contamination cleanup, including demolition of the buildings on the site. Presently, the EDA's budget impact will be the staff time necessary to monitor the grants, process payment requests to RER' s contractors performing grant related work and maintain the required financial records for the various funding agencies. Strategic Priorities: . 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