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02. Resolution 5425 - Creating a Tourism Business Improvement DistrictTel 406.758.7708 Fax 406.758.777 charbal l @ kallspel1.com Iu1�li5C�T#: TO: Mayor 'T`amm]. Fisher and Kalispell City Council FROM* Charles Harball, City Attorney Jane Howzngton, City Manager SUBJECT: Resolution No. 5425 — Creation of the Kalispell Tourism Business Improvement District and ordinance No. 1675 -- Regulations for the Tourism Business Improvement District MEETING DATE: May 3, 2010 — Regular Council Meeting BACKGROUND: A group of hoteliers, working with the Chamber of Commerce, have petitioned to form. a Business Improvement District. Under the terms of MCA 7-12-111(4) a district without contiguous boundaries may be formed from properties in a district that have a common purpose of providing overnight stags at lodging facilities and which encompasses all properties in the district with the same identified purpose. The petition contains signatures exceeding the 60% statutory threshold and no protests have been received for Council to consider. EC o A.'TIO: After considering the evidence received at the public hearing the City Council should consider making the finding that such BID meets the purposes of the statute and passing resolution. No. 5425 thereby creating the business improvement district and appointing the board of trustees from the slate provided by the working committee. ordinance No. 1675 creating the regulation for the BID sets forth the statutory framework and should be adopted by Council.. FISCAL A.CTs: The board of trustees representing the sixteen property owners shall recommend a work plan., budget and assessment recommendation to the Council. only these property owners shall be liable for the assessments and they shall be the most directly benefited by undertakings of the district. Respectfully submitted, Charles Harball, City Attorney 41ne Howington, City Manager RESOLUTION / DISTRICT PURSUANT TO THE TERMS OF TITLE 7 CHAPTER 12 PART 11 OF MONTANA CODE ANNOT-ITED. WHEREAS, pursuant to Title 7 Chapter 12 Part 11 of Montana Code Annotated, the City of Kalispell is authorized to create business improvement districts; and WHEREAS, the City of Kalispell was presented with petitions signed by the owners of more than 60% of the area of the property to be included in the district composed of noncontiguous areas that have the common purpose of providing overnight stays at lodging facilities which properties are shown on the attached Exhibit "A" and which by this reference is made a part hereof; and WHEREAS, the aforementioned petition requests that the City of Kalispell create a business improvement district for up to ten (10) years, pursuant to Section 7-12-1141 MCA; and WHEREAS, the purpose of said business improvement district appears to promote the health, safety, prosperity, security and general welfare of the inhabitants of the City of Kalispell and the proposed district, and appears to be of special benefit to the property within the boundaries of said proposed district; and WHEREAS, AS, on March 22, 2010 the Kalispell City Council issued Resolution 5419 declaring its intent to create a business improvement district for the City of Kalispell, Montana, to fix a date of a public hearing for May 3, 2010, and to provide for publication of notice of said hearing; and WHEREAS, the City Clerk caused proper notice of passage of the resolution to be published as provided in MICA 7--1--2 1 2 1 and by mailing a copy of the notice to every owner of real property within the proposed district listed on the last completed assessment roll for state, county, and school district taxes, at the owner's last -known address, on the same day the notice was first published or posted; and WHEREAS, upon proper notice having been given and upon the expiration of 15 days as required by FICA. 7-12-1113, the office of City Clerk received no written protests, and there is therefore insufficient protest to bar proceedings as allowed by FICA 7-12-1114. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF KALIS PELL AS FOLLOWS: SECTION I. That the Kalispell City Council shall and does hereby create a business improvement district pursuant to Title 7 Chapter 12 Part 11, Montana Code .Annotated the term of which shall be ten (10) years and which shall be known as the "Kalispell Tourism Business Improvement District." SECTION II. Said business improvement district shall be those properties identified on the attached Exhibit "A" which by this reference is made a part hereof as well as any future lodging facility located within the corporate limits of the City of Kalispell with five or more rooms providing overnight stays for transient patrons as its business. PASSED AND APPROVED BY THE CITY COUNCIL AND SIGNED BY THE MAYOR OF THE CITY OF KALISPELL, THIS 3rd DAY OF MAY, 2010. Tamm i Fisher Mayor ATTEST: Theresa white City Clerk EXHIBIT 44A9' Legal Description Kalispell Tourism Business Improvement District The boundaries of the District shall be all parcels, tracts, lots and blocks within the corporate limits of the City of Kalispell where a five or more room hotel is located and providing overnight stays as a lodging facility for transient patrons as its business. This description currently identifies all of the following lodging businesses located at the respective described street addresses and within the respective described legal parcel. Aero Inn, 1 30 Highway 93 South. (Bissell Revocable Trust) Assessor No. 0112600 Lot 1.A. of the R.esubdivision of Lot 1 of Block 1 of Airport Addition to Kalispell, Subdivision 73, in Section 20, Township 28 North., Range 21 west, P.M.M., Flathead County, Montana Blue & white Motel, 640 East Idaho (Blue & white Motel, Inc.) .Assessor No. 0084500 Tracts 30-1. 8, 30-20B and 30-27 in. the Northwest (quarter of the Southwest Quarter of Section 8, Township 28 North, Range 21 west, P.M.M., Flathead County, Montana Comfort Inn,1330 Highway 2 west (BRIG Kalispell LLC) Assessor No. 0428680 A. portion of Tract I in 4B's Addition Number 45 in Section 12, Township 28 North, Range 22 West, P.M.M., Flathead County, Montana Econo Lodge Inn & Suites,1680 Highway 93 South (Bullette Company of Michigan LLC) Assessor No. 0703050 Unit 1 of Diamond Lil's Condominiums in Section 17, Township 28 North, Range 22 west, P.M.M., Flathead County, Montana Assessor No. 0971720 Unit 3 of Diamond Lil's Condominiums in Section 17, Township 28 Forth, Range 22 west, P.M.M., Flathead County, Montana (Johnson Properties LLC) Assessor No. 0277026 Unit 2 of Diamond Lil's Condominiums in Section 17, 'Township 28 North, Range 22 west, P.M.M., Flathead County, Montana Glacier Peaks Inn,1550 Highway 93 North. (Northwest Hospitality Inc.) Assessor No. 0976349 Resubdivision of Lot 1 of Hall .addition in Section 6, Township 28 North, Range 21 west, P.M.M., Flathead County, Montana Glacier Ridge Suites, 281 1st avenue WN (Camren Center LLC) Assessor No. 0946500 Lots 19 and 20 in Block 6, Kalispell original Townsite, in Section 18, Township 28 North, Range 21 Vest, P.M.I., Flathead County, Montana Hampton Inn Kalispell,1140 Highway 2 west (Spring Creek Development, LLC) Assessor No. 0981479 Tract 1 of Certificate of Survey 15567 located in the Southeast Quarter of the Southeast Quarter of Section 12, 'Township 28 North, Range 22 Nest, P.M.M., Flathead County, Montana Hilltop Inn, 801 L Idaho Street (Kalispell Hilltop LLC) Assessor No. 0586900 Tract 2 of Certificate of Survey 8076 located in the Southeast Quarter of the Northwest Quarter and the Northeast Quarter of the Southwest Quarter of Section 8, Township 28 North, Range 21 west, P.M.M., Flathead County, Montana Hilton Garden Inn, 1845 Highway 93 South (Kalispell Motel, LLC) Assessor No. 0586900 Tract 1 of Certificate of Survey No. 17045, a tract of land situated, lying, and being the forth half of the Northwest Quarter of Section 20, Township 28 North, Range 21 west, P.M.M., Flathead County, Montana Holiday Inn Express, 275 Treeline Road (Big Slay HIE, LLC) Assessor No. 0012481 Imp 1906 on Lot 1 of the Holiday Inn Express Subdivision in Section 36, Township 29 North, Range 22 west, P.M.M., Flathead County, Montana Kalispell Grand. Hotel,100 Main Street (CM Clark) Assessor No. 0020900 Lots 1 and 2 of Kalispell Original °T`ownsite in Section 18, Township 28 North, Range 21 west, P.M.M., Flathead County, Montana Motel 6,1540 Highway 93 South (M-Six Penvest 1 Business Trust) .Assessor No. 0599250 A portion of Lot 7 and a portion of the Northerly 50 feet of Lot 8, Bloch 1 of the Plat of Poston Addition in Section 17, Township 28 North., Range 2lwest, P.M.M., Flathead County, Montana Outlaw Inns 1701 Highway 93 South (Kalispell Hospitality Company, Inc.) Assessor No. 0877530 Lots l , 2 and 3 of Ryker Addition to Kalispell Amended Lots 1-10 in Block 2 in Section 17, Township 28 North, Range 21 west, P.M.M., Flathead County, Montana Red Lion Hotel, 20 North Main (Red Dion Hotel Limited Partnership) Assessor No. 0974450 Tracts 8BA and 2AB in Southeast Quarter of the Southwest Quarter of the South. Half of the Southeast Quarter in Section 7, Township 28 North., Range 21 West, P.M.M., Flathead County, Montana Super 8,1341 1st Avenue East (D & D Inc. Hospitality Associates) Assessor No. 0036470 Tracts 5XB, 5-23A, 5-23.A.A and 5FA in the Southwest Quarter of the Southwest Quarter of Section 17, Township 28 North, Range 21 west, P.M.M., Flathead County, Montana Travelodge, 350 forth Main (Montana Hospitality) Assessor No. 0263865 Lots 1 through 6 and 9 through 12 of Bloch 241, Kalispell Addition 6, in Section 7, Township 28 North, Range 21 west, P.M.M., Flathead County, Montana Kalispell Tourism Business Improvement District 2010 Adopted by the Board of Trustees January ,2010 KALISPELL TOURISM BUSINESS IMPROVEMENT DISTRICT BYLAWS Article I Organization Section 1.1 Name. The name of the organization shall be the Kalispell Tourism Business Improvement Districts hereafter referred to as the "TBID," Section 1.2 Mission. The mission of the TBID is to generate room nights for lodging facilities in the city of Kalispell, Montana by effectively marketing our region as a preferred travel destination. Section 1.3 Powers. The TBID may engage in any activity consistent with the City of Kalispell law, Montana law, and these Bylaws, provided that the Board of Trustees determines that the activity is in furtherance of the purposes for which the TIBD was formed. Section 1.4 Definitions. The following terms used herein shall have the following definitions: fif (a) "Act means the Montana Business Improvement District Act. (b) "Appointing Authority" means the City Council of the City of Kalispell, Montana. (c) "Board" means the board of trustees of the TBID. (d) "Governing Body" means the City Council of the City of Kalispell, Montana. Article 1I Board of Trustees Section 2.1 Board of Trustees. All corporate powers shall be exercised by or under authority of, and the business and affairs of the TBID shall be managed under the direction of, the Board of Trustees of the TBID except as may be otherwise provided in these Bylaws or by law. Section 2.2 Number. The Board of Trustees shall consist of not less than five or more than seven owners of hotel property within the TBID or their designees. The number of trustees of the board, once established, may be changed within these limits from time to time by resolution of the Governing Body. A resolution to reduce board membership may not require resignation of any member prior to completion of the member's appointed tern. Section 2.Qualifications of 3 Trustees. Candidates for trustee should meet the following general criteria: (1) owners of land within the geographic area of the TBID or their designee, (2) committed to the well-being of the TBID, (3) respected citizen or leader, (4) able to work effectively as part of a group, (5) competent in some area of value in achieving objectives of the TBID, (6) able to maintain a commitment for the tern of appointment, and (7) balances board in terms of representation of large, medium and small hotel properties. Section 2.4 Nominations. Nominations for the Board of the TBID shall be made according to the guidelines established by the City of Kalispell. Section 2.5 Appointment. Seven initial trustees have been appointed by the Governing Body in City of Kalispell Resolution xx-xxxx, and future trustees shall be appointed by the Appointing Authority and approved by the Governing Body. Section 2.6 Tenn. Three of the trustees who are first appointed must be designated to serve for terms of 11, 2, and 3 years, respectively, from the date of their appointments, and two must be designated to serve for terms of 4 years from the date of their appointments. For a seven--mernber board, there must be two additional appointments for terms of 2 years and 3 years, respectively. After initial appointment, trustees must be appointed for a term of office of 4 years, except that a vacancy occurring during a term must be filled for the unexpired term. A trustee shall hold office until the trustee's successor has been appointed and qualified, Section 2.7 Absences. If, within a period of twelve (12) consecutive months, any trustee is absent from three (3) or more regular Board meetings, notice of which has been given to the trustee at the trustee's usual place of work or residence, or by announcement at a meeting attended by the trustee, the Chairman may call such absences to the attention of the Board which may then recommend to the Appointing Authority that such trustee be removed and that another person be appointed to serve for the unexpired tenor. Section 2.8 Resignation, Removal and vacancies . A trustee may resign at any time by delivering written notice to the Board. A. trustees resignation is effective upon delivery of the notice of resignation unless the Board authorizes other -vise. A member of the Board may be removed by the Appointing Authority, with the consent of the Governing Body. A vacancy on the Board shall be filled by the Appointing Authority, with the approval of the Governing Body. Section 2.9 Powers and Duties. The Board shall have those powers set forth in the Act, The Board's responsibilities shall include, without limitation, (1) administration of the TBID, including oversight of expenditure of its funds; (2) the establishment of goals and policies for the TBID, (3) providing annual budgets and work plans to the Governing Body for approval each fiscal year; (4) nomination of trustees for the TBID to the Appointing Authority and Governing Body; (5) recommending to the Governing Body for approval each fiscal year a method of levying an assessment on the property within the TBID that will best ensure that the assessment on each lot or parcel is equitable in proportion to the benefits to be received; (6) appointment of a director of the TBID; (7) approval and implementation of projects and programs to be undertaken or administered in furtherance of the objectives of the TBID and the purposes of the Act, (8) compliance with the requirements of the Act, and (9) long range and strategic planning. Section 2.1 o No Compensation. Members of the Board may receive no compensation. Article III Meetings of the Board Section 3.1 Regular Board Meetings. The regular monthly meetings of the Board shall be held at a time and location determined by the Board. Notice of such meetings shall be provided by telephone, telefax, U.S. mail, email, or other communication, at least seventy-two hours before the regular meeting is to occur. Public notice of regular Board meetings shall be provided via news release, web site, newspaper advertisement or other method determined by the Board to inform the community. Section 3.2 Special Board Meetings. The Chair or any officer and two members of the Board may call a special meeting of the Board upon at least forty-eight hours notice as provided in Section 3.1 to each member of the Board. Such notice shall state the purpose for which such special meeting is called. Section 3.3 Quorum. A quorum of the Board consists of a majority of the number of trustees in office immediately before the meeting begins. Trustees may be in attendance at any meeting in person or by telephone connection, but any such connection shall permit any trustee not attending in person to hear all discussion concerning any item upon which action is to be taken, and shall permit all persons in attendance to hear the trustee attending by telephone. Section 3.4 Board Action. 1f a quorum is present at a meeting of the Board, then the affin-native majority vote of the trustees present at the meeting shall constitute the act of the Board. The Board may not tape any action unless a quorum of the Board is present, except a majority of less than a quorum may adjourn the meeting from time to time without further notice. Each trustee shall have one (1) vote. Section 3.5 Proxy Prohibition. No proxy voting shall be permitted. Section .6 Actions b written Consent. Any action of the Board may be taken without a meeting and may be in the form of fax or email. A 2/3 majority of the voting members of the Board are required to pass a written motion. Section 3.7 Committees. The Board may designate and establish such committees and task forces as it considers appropriate to carry into effect the objectives and purposes of the TBID. Committee chairs will be appointed by the Chair of the Board. Committee meetings or task force meetings may be called at any time by the chairperson of the committee or task force or by the Chair of the Board. At any duly called meeting of a committee or task force, those present shall constitute a quorum. Each committee and bask force shall study, investigate and make recommendations to the Board on subjects within the general scope of activity assigned it by the Chair of the Board or which subsequently may be referred to it by the Chair of the Board or by the Board. .Article IV Officers Section 4.1 officers, There shall be a Chairs a Vice Chair, a Secretary/Treasurer and TBID Executive Director of the Board who shall be the officers of TBID. In the absence of the Chair the Vice Chair shall act as chairman. The Executive Director is a non --- voting member of the Board. Section 4.2 Election of officers. officers shall be elected annually by the Board at the last regular meeting of the fiscal year. Any officer may sign all official documents on behalf of the organization upon approval by the Board, and shall have such other duties as the Board may direct. Section 4.3 Chair. The Chair shall preside at all meetings of the Board and at any other meetings of the TBID. The Chair shall appoint members to such committees and task forces as are created by the Board of Directors. The initial chair shall be appointed by the Mayor of the City of Kalispell, pursuant to §7-12-1122 M.C.A. The teen of office of the Chair shall be for one year or until his/her successor is elected. Section 4.4 Vice Chair. The Vice Chair shall perfon-n the duties and exercise the powers of the Chair in the absence or disability of the Chair and shall perform any other duties as prescribed by the Board of Directors. Section 4.5 Secretary/Treasurer, The secretary/treasurer shall beep a record of all proceedings, minutes of meetings, certificates, contracts and corporate acts of the Board and shall be responsible for oversight of the financial records of the organization. The Board may appoint an assistant secretary/treasurer who need not be a member of the Board. Section 4.6 Executive Director. An Executive Director of the TBID shall be appointed by the Board. The Executive Director must be the executive director of a nonprofit convention and visitor bureau, as defined in 15- 65--101, M.C.A., if a nonprofit convention and visitor bureau is operating within the Governing Body's jurisdiction. The Executive Director shall be charged with the general supervision and management of the business affairs of the TBID. The Executive Director shall be the chief executive officer and shall be charged with initiating and implementing the marketing plan, budget and related projects, the general supervision over employees, including their duties and compensation in conformity with the policies approved by the Board. The Executive Director shall Deep the minutes of the Board meetings, keep other records as the Board may direct, and perform such other duties as may be prescribed by the Board, these Bylaws, or by law. The Executive Director shall so manage the affairs of the TBID as to promote the objectives for which the TBID is organized. Section 4.7 other officer Duties. The Board may provide such additional duties for any officer, as it deems necessary. Section 4.8 officer Vacanc . A vacancy in any office shall be filled by the Board at its next regular meeting for the remainder of the unexpired ten-n. Article V Confl*ct of Interest Section 5.1 Conflict of Interest. A conflict of interest transaction is a transaction with the TBID in which a trustee of the TBID has a direct or indirect interest. A conflict of interest transaction is not voidable or the basis for imposing liability on the interested trustee if the transaction was fair at the time it was entered into or is approved pursuant to Mont. Code Ann. §35-2-418. However, in no event shall the interested trustee vote on the decision to enter into such transaction. Any trustee having an interest or conflict in a transaction presented to the Board for authorization, approval, or ratification shall make a prompt, full and frank disclosure of his or her interest to the Board prior to its acting on such transaction. Such disclosure shall include any relevant and material facts, Known to such person, about the transaction which might reasonably be construed to be adverse to the TB ID's interest. The Board shall thereupon determine, by majority vote, whether the disclosure shows that a conflict of interest exists or can reasonably be construed to exist. If a conflict is deemed to exist, such trustee shall not vote on, nor use his or her personal influence on, nor participate (other than to present factual infon-nation or to respond to questions) in the discussions or deliberations with respect to such contract or transaction, nor shall the trustee be counted in detennining the quorum for the meeting. The minutes of the meeting will, upon request, reflect that a disclosure was made, the action taken with respect to such disclosure, and, if applicable, the abstention from voting and the presence of a quorum. Article vI Administrative and Financial Provisions Section 6.1 Fiscal Year. The fiscal year of TBID shall be July I - June 30. Section 6.2 Check Wr ting,,Authority. The Board shall establish limits on the check writing authority of trustees, officers, employees, and agents of TBID. Section 6.3 Budget.. and Marketing..Plan. Expenditure of all income shall be allocated to meet the operating needs of the TBID under a budget and marketing plan prepared by the Executive Director and adopted by the Board and the Governing Authority. The Executive Director shall make a cumulative report each month to the Board on income and expenditures. The approved budget and marketing plan shall be reviewed as requested by the Board to assure that funds are being expended as allocated and to deters -nine if any reallocation of resources is needed. Section 6.4 Disbursements. Upon approval of the Fiscal Year Budget by the Board and the Governing Body, the Executive Director is authorized to make such disbursements as necessary on accounts and expenses provided for in that budget, without additional approval from the Board. Such disbursements may be made by check and require any one (1) of the following signatures: Executive Director or Chair or any designated trustee(s). Checks shall be supported by proper requisitions, vouchers, statements, or other evidence showing the expenditure to be appropriate and authorized under the budget. Section 6.5 Indebtedness. No loan or advance shall be made or contracted on behalf of the TBID, and no note, bond, or other evidence of indebtcdness shall be executed or delivered in its name except in the manner provided by law and as authorized by the Board. Section 6.6 Public Records. All financial records of the TBID related to assessments are public documents and shall be made available to any member of the public who wishes to see them, provided arrangements are made in advance to review said records in the office of the TBID during regular office hours. Approval of a majority of the Board shall be required to remove any financial record of the TBID from the public file. Section 6.7 Audit. The Board shall engage an independent certified public accounting fir -n to audit, annually, all general and special accounts of the TBID in accordance to the standards established by the City of Kalispell. The firm may be instructed to perform unannounced audits at any given period of the year for verification of accounts, in addition to the annual audit. The Board may from time to time audit hotel reports of occupancy to assure proper collections of assessments. All audit results should be distributed in writing on a timely basis to the Board. Section 6.8 'Use of Assessments. Assessments collected by the TIBD shall be used for the following purposes: (a) The funding of all uses and projects for tourism promotion within Kalispell as specified in the Kalispell TBID budget; and (b) The marketing of convention and trade shows that benefit local tourism and lodging businesses in Kalispell; and (C) The marketing of Kalispell to the travel industry in order to benefit local tourism and the lodging businesses located within the Kalispell TBID; and (d) The marketing of Kalispell to recruit major sporting events in order to promote local tourism and to benefit the lodging businesses within the Billings IBID. Section 6.9 Spokesperson. only the Chair of the Board, the Executive Director, or their designee shall have authority to speak on behalf of, or to issue press releases for, the Board or the TBID Article vII Amendments Section 7.1 These Bylaws may be amended or repealed and new Bylaws adopted by the Board any regular or special meeting of the Board by the affirmative vote of at least two-thirds (2/3) of the trustees. CERTIFICATE OF ADOPTION OF BYLAWS The undersigned hereby certifies that the above Bylaws of the Kalispell Tourism Business Improvement District were duly adopted by majority vote of the Board of Directors at a duly held meeting on January 1 2010, and now constitute the Bylaws of the Kalispell Tourism Business Improvement District. DATED: January , 2010. , Secretary Kalispell Tourism Business Improvement District Board of Directors and Kalispell Chamber of Commerce Operating Agreement THIS AGREEMENT ("Agreement") is made this xx day January, 20101 by and between the Kalispell Chamber of Commerce, a 501 (c)(6) non-profit corporation, with its principal place of business at 15 Depot Park, Kalispell, Montana, ("Chamber/CVB"), and the Kalispell Tourism Business improvement District Board of Directors, a division of the City of Kalispell; with its principal place of business at 15 Depot Park, Kalispell, Montana ("TBID"). The Chamber and the TBID are collectively referred to as the "Parties" and individually at the "Party". WHEREAS, on January xx, 2010, the City of Kalispell, by Resolution xx-xxxx, created a Tourism Business Improvement District for a 10-year duration, effective January xx, 2010, and; WHEREAS, the mission of the TBID is to promote and market Kalispell, Montana and to promote tourism, conventions, trade shows, and generate room nights for lodging facilities in Kalispell by effectively marketing our region as a preferred travel destination, and; WHEREAS, the mission of the Chamber is to develop a strong business climate and vibrant economy by serving the community in a leadership role thereby enhancing the quality of life, and; WHEREAS, the Chamber and TBID have common goals and interests in the promotion, marketing, and selling of visitor overnights and such goals and interests are in furtherance of the purposes of both Parties, and; WHEREAS, the State of Montana has mandated that the director of a tourism business improvement district must be the executive director of the existing convention and visitor bureau, when one exists, and the Chamber has served as that designated entity by the City of Kalispell since 1987, and; WHEREAS, given their common interests and their mutual desire to maximize opportunities available to them and the minimize administrative expenses, the Parties wish to enter into this Agreement, by which the Chamber will provide the TBID with certain staffing, office space, office equipment, office furniture, office supplies, office services, and other administrative support, and by which the Chamber may license, and TBID may accept certain intellectual property; NOW THEREFORE, in consideration of the premises set forth above and the promises set forth below, the sufficiency and receipt of which are hereby acknowledged, the Parties hereby agrees as follows: 1. Term and Termination A. Term. This agreement shall be effective as of January xx, 2010 and shall remain in full force and effect until June 30, 2020, or as long as the tourism business improvement district created by the city of Kalispell pursuant to Resolution xx- xxxx is in effect, unless terminated earlier pursuant to this Agreement. B. Termination without cause. Either Party may terminate this Agreement, without cause, by giving written notice to the other Party stating when, but not less than ninety (90) days thereafter, such termination shall be effective. C. Termination for cause. Either Party may terminate this Agreement, for cause, if either Party notifies the other Party of a material breach of any provision of the Agreement. The breaching Party shall have thirty (30) days following notice to cure the breach. The notice shall specify the alleged breach and the date on which termination will be effective unless such breach is cured to the satisfaction of the non -breaching Party within the time period allowed. D. Termination for other Reasons. 1. Either Party may terminate this Agreement upon thirty (30) days notice to the other if at any time: a. The City of Kalispell does not approve an annual work plan or budget for the tourism business improvement district that permits continuation of this Agreement as determined in their reasonable discretion of the TBID. b. Either Party determines that its continued relationship with the other Party will threaten any relevant tax exemption that either Party now possesses ❑r shall possess in the future. 2. This Agreement shall terminate automatically upon termination of the tourism business improvement district created by the city of Kalispell pursuant to Resolution xx-xxxx. 3. This Agreement may be terminated at any time by mutual written agreement of the Parties. II. Board Res onsibilities and Relationshi The Board of Directors of each Party shall retain all governing authority of that respective Party placed in it by law and its bylaws. The Board of Directors of each Party shall represent that Party in matters relating to this Agreement and interpretation. Each Party shall appoint a non -voting member from its Board of ❑irectors to serve in an ex - off icio capacity on the other Party's Board to provide regular reports and communications. Ill. Services During the term of this Agreement, TBID engages Chamber/CVB to provide the services and functions described in this Agreement, and the Chamber/CVB agrees to provide such services and functions, under the terms set forth herein. The services and functions are as follows: A. offices Space,_ Furniture Su lies and Services 2 1. Office Space. ChamberlCVB shall provide TBID with office space, at the TB I D's cost, within the Chamber/CVB's premises, currently located at 15 Depot Park, Kalispell, Montana (see Addendum A). 2. Furniture Fixtures and E ui ment. ChamberlCVB shall provide TBID with the use of office equipment, office furniture, office supplies, office services, and other administrative support as is currently offered (see Addendum B). 3. Pa ment for S ecific Items. If the Parties agree that specific additional equipment, furniture, supplies or services are needed solely for the use of the TBID, the cost of the same will be borne by the TBID. If the Parties determine that specific additional equipment, furniture, supplies or services are needed for the mutual shared use of the Parties, the Parties shall determine a reasonable basis to share the cost. B. Professional Services and Staffin 1. President/CEO. The President/CEO of the ChamberlCVB shall act as the Executive Director of the TBID without charge to the TBID. The President/CEO shall report to the TBID Board of Directors and shall serve as the Director of the TBID funds as required by state statute (Montana Code Annotated-2007, 7-12-1121). The President/CEO shall have supervisory authority and responsibility for all staff of the ChamberlCVB, and shall have sole discretion to hire, fire, evaluate and assign duties to employees. The President/CEO will be evaluated by the ChamberlCVB Board. The TBID may have a representative serve on the selection committee for TBID program manager positions. 2. Employee Services. ChamberlCVB shall employ professionals who shall provide services to the TBID. These employees shall report to the ChamberlCVB President/CEO. TBID shall reimburse ChamberlCVB for all costs and expenses related to recruiting, hiring, and training employees including all costs related to salary, benefits and other compensation as may be adjusted from time to time. These employees shall be subject to the employment policies of the ChamberlCVB and shall be subject to its oversight and supervision. The ChamberlCVB shall have the authority to hire, discipline and discharge its employees. 3. Financial Administration. The ChamberlCVB shall establish and administer accounting procedures, systems, and controls in accordance with generally accepted accounting principles in order to develop, prepare and safe keep the financial records and books of account for the business and financial affairs of the TBID. The ChamberlCVB shall prepare and provide regular financial statements for the review and use of the Board of Directors of the TBID at its regular Board meetings. a. Disbursements. TBID disbursements shall be made in accordance with the bylaws of the TBID. The President/CEO shall assist in development of its annual report and workplan to present for annual approval by the City of Kalispell. 3 b. Agency Fund. The ChamberlcVB is acting as an agent of the City of Kalispell for the administration of TBID funds. The City will collect assessed funds quarterly from hoteliers within the district. Disbursements will be made quarterly from the city into a restricted account of the ChamberlCVB. The charnberlCVB will provide accounting, tax, and audit services, and liability insurance according to the standards established by the city for Agency Funds. such costs will be paid from, or reimbursed by, TBID funds. IV. Intellectual and Physical Property A. _Name and Lobo. Each Party shall retain ownership and use of its own registered name, logo, and any trademarks or service marks. B. confidential Information and Intellectual Pro ert . During the term of this Agreement, the Parties anticipate that certain information and intellectual property will be developed for the purposes of the chamberlcVB and the TBI D's mission and activities. said confidential information and intellectual property includes, but is not limited to, databases, lists, customer lists, visitor guides and publications, financial and proprietary information, concepts, documents, materials, trade secrets, business contacts, and ideas about current and future projects which the chamberlcVB or TBID regards as confidential. All such confidential information developed pursuant to the services provided under this Agreement shall be owned jointly by the Chamber/CVB and the TBID. C. Physical Property. Physical property solely with TBID funds will be owned by the TBID. Property purchased jointly by the chamberlcVB and TBID will be owned jointly by the Chamber/CVB and the TBID and will be distributed equitably upon any separation of the Parties V. Insurance A. TBID Insurance. The chamberlcVB, as an agent of the City, shall maintain a policy or policies of comprehensive general liability insurance coverage which will include activities of the TBID and name the city as additionally insured in an amount sufficient for such purposes by the city of Kalispell, as required by 7-12- 143 MCA. B. Proof of Coverage. Proof of the foregoing insurance coverage, as applicable, shall be provided by the chamberlcVB to the city at the commencement of this Agreement, and annually upon renewal of coverage. VI. Indemnification Each Party hereby agrees to indemnify, save and hold harmless the other Party and the other Party Is subsidiaries, affiliates, related entities, partners, agents, directors, employees, attorneys, heirs, successors, and assigns, and each other from and against all claims, actions, demands, losses, damages, judgments, settlements, costs and 4 expenses (including reasonable attorney's fees and expenses), and liabilities of every kind and character whatsoever, which may arise by reason of: ) any act or omission constituting a breach or default under this Agreement by the party or any of its officers, directors, employees, or agents in their capacity as officers, directors, employees, or agents of the Party; and/or 2} the inaccuracy or breach of any of the representations or warranties made by the Party under this Agreement. The indemnity under this Section shall require the payment of costs and expenses by the liable Party as they are incurred. The Party seeking reimbursement or indemnity under this Section shall promptly notify the liable (other) Party upon receipt of any claim or legal action referenced in this Section. The indemnified Party shall not at any time admit liability or otherwise attempt to settle or compromise said claim, action or demand, except upon the express prior written instruction or agreement of the indemnifying Party or upon the repudiation or denial of the indemnification by the indemnifying Party. For the purposes of this Section, a repudiation or denial of indemnification shall be deemed to occur if the Party seeking indemnification does not receive written confirmation of indemnification from the other Party from whom the indemnification is sought within thirty (30) calendar days of notice of the claim, action or demand by the Party seeking indemnification. The Party seeking indemnification shall make all reasonable efforts to provide the Party from whom reimbursement is sought with all information that may be useful in determining whether indemnification is proper. The provisions of this Section shall survive any termination or expiration of this Agreement. VII. Relationship of Parties In the performance of the services to be provided pursuant to this Agreement, the Parties understand and agree that the Chamber/CVB and any of its employees or agents shall be, and at all times are, acting as agents of the TBi D. No Party shall have the power to bind or obligate the other except as specifically provided in this Agreement. VIII. Notices Any notices required hereunder shall be in writing and shall be deemed to have been duly given when hand delivered or when deposited in the United State mail, if mailed by certified or registered mail, return receipt requested, postage prepaid, or sent by federal express or other courier service and addressed to the person(s) at the address set forth at the end of this Agreement or such other person and/or address of which the receiving party has given notice pursuant to this Section. All notices shall be considered given and received on the date appearing on the return receipt thereof, or on the delivery date appearing on the records of federal express or other courier service. ix. General Provisions A. Legal Capacity. The Parties each warrant to the other that it has the legal capacity to enter into this Agreement, that the execution has been duly approved by its Board of Directors and that its obligations under the Agreement do not violate its organizational documents, bylaws, or any agreement to which it is party. B. Non-Assum tion of Liabilit . Except as specifically set forth herein, chamber/CVB shall not, by entering into and performing this Agreement, become liable for any of the existing or future obligations, liabilities, or debts or TBID 5 under this Agreement. TBID shall not, by entering into and performing this Agreement, become liable for any of the future obligations, liabilities, or debts of Chamber/CVB. C. Amendments. No amendments or additions to this Agreement shall be binding unless executed in writing and signed by the Parties D. Governing Law. This Agreement shall be governed by and constructed according to the laws of and subject exclusively to the jurisdiction of the courts of the State of Montana. Venue for any action under this Agreement shall be in Flathead county, Montana. E. Waiver of Breach. No waiver of any breach of any provision ❑r condition of this Agreement, whether by course or dealing or otherwise, shall be effective unless evidenced by any instrument in writing duly executed by the party against whom such enforcement or waiver is sought. Waiver of breach of any term or provision of this Agreement shall not be deemed a waiver of any other breach of the same or a difference provision. F. Severability. In the event any term or provision of this Agreement is rendered invalid or unenforceable by any valid legislative or regulatory act or declared null and void by any court of competent jurisdiction, the remaining provisions of this Agreement shall remain in full force and effect. O. Headings. The paragraph headings contained in this Agreement are for reference purposes only and should not affect in any way the meaning or interpretation of this Agreement. H. Prior Agreements. This Agreement constitutes the complete Agreement of the Parties, and shall supersede and render null and void all prior and contemporaneous agreements between the Parties regarding the subject matter hereof. 1. Assignment. Neither Party may assign its rights duties or obligations under this Agreement without the prior written consent of the other Party, which consent may be withheld in the sole discretion of a Party. This Agreement shall be binding upon and inure to the benefit of permitted assignees. J. Attorne 's Fees. If any legal proceeding is commenced which is related to this Agreement, the losing Party shall pay the prevailing Parley's actual attorney's fees and expenses incurred in the preparation for, conduct of or appeal or enforcement of judgment from the proceeding. K. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original for all purposes and all of which taken together, shall constitute one and the same instrument. IN WITNESS HEREOF, the parties hereto have executed this Agreement on this xx day of January, 2010. G KALISPELL TOURISM BUSINESS IMPROVEMENT DISTRICT BOARD OF DIRECTORS By: Its: KALISPELL CHAMBER OF COMMERCE AND CONVENTION AND VISITOR BUREAU By: Its: CITY OF KALISPELL By: Its: 7