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5. City Manager ContractEMPLOYMENT AGREEMENT THIS AGREEMENT, made and entered into this day of , 1996, by and between the City of Kalispell, State of Montana, a municipal corporation, hereinafter called "City", as party of the first part, and Clarence W. Krepps, hereinafter called "Employee", as party of the second part, both of whom understand as follows: WITNESSETH: WHEREAS, City desires to employ the services of said Clarence W. Krepps as City Manager of the City of Kalispell as provided by the City Code, City Ordinance, and applicable Montana Codes. WHEREAS, it is the desire of the City to provide certain benefits, establish certain conditions of employment, and to set working conditions of said Employee; and WHEREAS, it is the desire of the City to (1) secure and retain the services of "Employee" and to provide inducement for him to remain in such employment; (2) to make possible full work productivity by assuring Employee's morale and peace of mind with respect to future security; (3) to act as a deterrent against malfeasance or dishonesty on the part of the Employee; and (4) to provide a just means for terminating Employee's services at such time as he may be unable fully to discharge his duties due to disability or when the City may desire to otherwise terminate his employ; and WHEREAS, Employee desires to accept employment as the City Manager of said City; NOW THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto agree as follows: SECTION 1: DUTIES A. The City of Kalispell hereby agrees to employ said Clarence W. Krepps as City Manager of said City to perform the functions and duties specified in the City Code and to perform such other legally permissible and proper duties and functions as the City Council shall from time to time assign. SECTION 2: TERM A. Nothing in this Agreement shall prevent, limit or otherwise interfere with the right of the City to terminate the services of Employee at any time, subject only to the provisions of the City Code and as set forth in Section 3, Paragraphs A and B of this Agreement. Paragraphs A and B of Section 3 shall not be 1 applicable if the Employee is found to be unable to discharge his duties due to any type of disability or inability to perform up to normal standards of City Management as determined by the City Council. B. Nothing in this Agreement shall prevent, limit or otherwise interfere with the right of the Employee to resign at any time from his position with the City subject only to the provisions set forth in Section 3, paragraph B and Section 3, paragraph C of this Agreement. C. Employee's term of employment under this Agreement shall be from ,1996 to ,1998. Employee agrees to remain in the exclusive employ of the City, and neither to accept nor to become employed by any other employer until said termination date is effected as hereinafter provided. D. In the event written notice is not given by either party of this Agreement to the other 60 days prior to the termination date as hereinabove provided unless otherwise mutually agreed, this Agreement shall be extended on the same terms and conditions as herein provided, all for an additional period of two years thereafter. SECTION 3: TERMINATION AND SEVERANCE PAY A. In the event Employee is terminated for any reason, except conviction of a felony, by the City during the term of employment, and said Employee is willing and able to perform the duties of City Manager, then in that event the City agrees to pay Employee a lump sum cash payment equal to 6 months of the current annual base salary and 50% of the total of the City's share of the ICMA-RC compensation plan payments; provided. If the termination is within a one year period (from date of employment) the City shall pay Employee a lump sum cash payment equal to 8 months of the current annually base salary and 67% of the total of the City's share of the ICMA-RC Compensation plan payments. B. In the event the City, at any time during the employment term, reduces the salary or other financial benefits of Employee in a greater percentage than an applicable across-the-board reduction for all city employees, or in the event the City refuses, following written notice, to comply with any other provision benefiting Employee herein, or the Employee resigns following a suggestion by a majority of the City Council that he resign, then in that event, Employee may, at his option, be deemed to be "terminated" at the date of such reduction or such refusal to comply, within the meaning and context of the severance pay provision contained in Section 3, paragraph A of the Agreement. 2 C. In the event Employee the City after voluntarily resigns his position with give the City 60 days notice otherwise. Employee in the forfeits any claim to cash under Section 3 (A), above. 1996, then Employee shall in advance unless mutually agreed event of voluntary resignation payment or ICMA-RC contribution SECTION 4: BASE SALARY: COMPENSATION ADJUSTMENTS A. The City agrees to pay Employee for his services rendered pursuant hereto an annual base salary of $62,000.00 payable in installments at the same time as other employees of the City are paid. B. The City Council agrees to increase compensation to $63,860.00 after six (6) months of service, subject to satisfactory evaluation by the City Council. C. In addition, the City Council agrees to review compensation annually at the date of employment anniversary date during the employment of the Employee. SECTION 5: HOURS OF WORK A. It is recognized the Employee must devote a great deal of his time outside normal office hours to business of the City and to that end Employee will be allowed to take reasonable time off as he shall deem appropriate. B. Employee shall not spend more than ten (10) hours per week in teaching, or consulting on other non -city connected business. The express prior approval of the City Council shall be required prior to Employee's commitment for these activities. SECTION 6: AUTOMOBILE A. Employee is expected to utilize his persona•1 vehicle for all City business. All expenses involved in the operation of Employee's personal vehicle shall be Employee's only. City shall pay the Employee $400.00 per month for the use of his personal vehicle. No reimbursement for travel or mileage within the State of Montana shall be authorized. Said Employee will be compensated for all City driving on City business outside the State of Montana at the most current rate authorized by the State of Montana. (Driving outside the State of Montana shall have prior approval of the City Council.) SECTION 7: DUES AND SUBSCRIPTIONS A. The City agrees to budget and to pay the professional dues and 3 subscriptions of Employee necessary for his continuation and full participation in national, regional, state and local associations and organizations necessary and desirable for his continued professional participation, growth and advancement, and for the good of the City. SECTION 8: PROFESSIONAL DEVELOPMENT A. The City hereby agrees to budget and pay the travel and subsistence expenses of Employee for professional and official travel, meetings, and occasions adequate to continue the professional development of Employee and to adequately pursue necessary official and other functions for the City including, but not limited to the Annual Conference of the International City Management Association or the National League of Cities Conferences, Montana City Management Association, the League of Montana Municipalities, and such other committees which Employee serves as approved by the City Council. B. The City also agrees to budget and to pay for the travel and subsistence expenses of Employee for short courses, institutes and seminars that are necessary for his professional development and for the good of the City as approved by the City Council. SECTION 9: GENERAL EXPENSES A. The City recognizes that certain expenses of a non -personal and generally City related nature are incurred by Employee and hereby agrees to reimburse or to pay for said expenses as provided for in the budget. SECTION 10: HEALTH INSURANCE A. The City agrees to provide and to pay the total premium for medical insurance for the Employee and his dependents, as part of the City's group health insurance program. Upon termination the City agrees to provide and to pay for the total Health Insurance Premium for the Employee and his dependents for a period of 6 months from the effective date of termination. If Employee is re-employed with a city within the 6 months period, the City's obligation for the insurance premium immediately ceases on the date of employment. SECTION 11: TERM LIFE/DISABILITY INSURANCE A. The City also agrees to pay annually (Date of Employment Anniversary Date) the Employee a lump sum amount equivalent to 2% of the base salary in lieu of providing term life and/or disability insurance. The first payment shall be 2% of base from date of employment to December 31, 1996. 4 SECTION 12: RETIREMENT: ICMA-RC PLAN A. The City agrees to adopt the ICMA-RC deferred compensation program and to allow Employee to participate fully in same. Employee shall have sole authority to determine the amount of base salary to be deposited in said ICMA-RC. The City shall be required to contribute the equivalent of 10% of the Employee's base salary to said ICMA-RC. The payment shall be as follows: 1. 1996 - The 10% equivalent will be paid directly to the Employee. This sum shall be figured from Date of Employment through December 31, 1996 and paid to Employee as a lump sum payment on the first payroll after employment date. 2. January 1, 1997 (1st business day) - 50% of the annual total shall be paid to ICMA-RC. Thereafter annually on January 1 (1st business day) a 50% payment shall be made to ICMA-RC. 3. From January 1, 1997 and thereafter the 50% balance of the City's share of ICMA-RC payments shall be submitted as per payroll submission. 4. The City agrees to accept transfer of Employee's current ICMA-RC account assets and to guarantee these funds will be used solely for the purpose of the Employee for future retirement purposes. SECTION 13: OTHER TERMS AND CONDITIONS OF EMPLOYMENT A. Employee's moving expenses shall be reimbursed by the City at 100% of total costs. This will include all household items (furniture, car, golf cart) from Storm Lake to Kalispell, Montana. Employee will secure 3 estimates and use the lowest one. In addition to the moving expenses, City shall reimburse Employee for one air trip and associated expenses for the Employee and spouse to conduct a housing search. If necessary the City shall reimburse employee for 1 one-way trip from Kalispell to Storm Lake, Iowa to conduct the final move. Temporary housing for the Employee, if employee must move prior to spouse's moving, will be reimbursed for 3 months housing expenses not to exceed $2,000. 5 B. If any provisions or any portion thereof contained in this Agreement is held to be unconstitutional, invalid, or unenforceable, the remainder of this Agreement, or portion thereof, shall be deemed severable, shall not be affected, and shall remain in full force and effect. C. The City shall acquire and bear the full cost of any fidelity or other bonds required of the Employee under any law or ordinance. IN WITNESS WHEREOF, The City of Kalispell, on a vote of its City Council has caused this Agreement to be signed and executed in its behalf by its Mayor and duly attested by its City Clerk, on the day and year first above written. Mayor City of Kalispell State of Montana ATTEST: City Clerk of Council STATE OF MONTANA ) ss County of Flathead ) On this day of , 1996, before me, a Notary Public in and for the State of Montana, personally appeared Douglas D. Rauthe, and Debbie Gifford, known to me to be the Mayor and City Clerk of Council of the City of Kalispell, a municipality, that executed the within instrument, and acknowledged that such Mayor and City Clerk of Council subscribed, sealed and delivered said instrument as the free and voluntary act of said municipality, for the uses and purposes therein set forth, and that they were duly authorized to execute the same on behalf of said municipality. 0 IN WITNESS WHEREOF, I have hereunto set my hand and affixed my Notarial Seal, the day and year first above written. Notary Public, State of Montana Residing at Kalispell, Montana My Commission expires Clarence W. Krepps, Employee STATE OF IOWA ) :ss County of ) On this day of June, 1996, before me, a Notary Public in and for the State of Iowa, personally appeared Clarence W. Krepps, known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he executed the same. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my Notarial Seal, the day and year in the certificate last above written. Notary Public for the State of Iowa Residing at• My Commission Expires: