E4. Memorandum and MOU with FCEDA. . ........ ....-City of Ka
Post office Box 1997 - Kalispell, Montana 59903
Telephone: (406) 75 8-7701 Fax: (406) 75 8-7758
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To: Mayor Johnson and City Council
From: Doug Russell, City Manager
Re: Memorandum of Understanding with Flathead County Economic
Development Authority - Engineering Costs for Rail Park Development
Meeting Date: January 2.0, 2015
BACKGROUND: The City of Kalispell and Flathead County Economic Development
Authority (FCEDA) have been working on a project that would include relocating the railroad
tracks from our "Core Area" and developing a new rail -served industrial park. This effort has
included two unsuccessful attempts at TIGER funding. Since the announcement of the TIGER
awards this past fall, we have been working together to develop financing plans that would allow
this partnership to successfully initiate the rail relocation and park development with or without
TIGER funding.
At a previous joint work session, we discussed moving forward with FCEDA to split the costs of
final engineering for the first phase of the rail park development. This agreement is being
presented to council tonight in the form of a Memorandum of Understanding (MOU). This
MOU not only identifies the responsibilities for the engineering development, but also acts as an
aid in approaching other partners of the project, as it documents the commitment from both
parties to move forward on this project.
The FCEDA board approved the MOU with the City of Kalispell at their January 7, 2015,
meeting. The signed copy is attached to this memorandum. It outlines FCEDA's responsibility
to manage the engineering for the project and our cost share responsibilities. It is estimated that
engineering for the project will be approximately $700,000, though that number could change
with the involvement of additional partners.
FISCAL IMPCAT: The MOU identifies that FCEDA and the City of Kalispell will split the
costs for engineering for the first phase of the rail park development. It is estimated that 50% of
these costs will be approximately $350,000. Funding will come from the redevelopment line
item in the west Side Tax Increment Finance District as part of the rail track relocation effort.
ALTERNATIVES: Council may reject the MOU with FCEDA or request different parameters
than those that have been previously discussed and incorporated into the MOU.
RECOMMENDATION: It is recommended that the City Council move to approve the
attached Memorandum of Understanding between the City of Kalispell and Flathead County
Economic Development Authority.
ATTACHMENTS: MOU with FCEDA
MEMORANDUM OF UNDERSTANDING
THE CITY OF KALISPELL
between
THE FLATHEAD COUNTY ECONOMIC DEVELOPMENT AUTHORITY
The CITY OF KALISPELL, hereinafter referred to as "the City", a municipal
corporation duly formed and authorized pursuant to Montana state law and with business offices
located at 201 First Avenue East, Kalispell, Montana, and the FLATHEAD COUNTY
ECONOMIC DEVELOPMENT AUTHORITY, hereinafter referred to as "FCEDA" a
corporate public body established pursuant to Montana state law and with business offices
located at 44 Second Avenue West, Kalispell, Montana hereby enter into agreement as set forth
below.
WHEREAS, the City is a municipal corporation of the State of Montana located within
Flathead County, Montana and is duly organized and in existence pursuant to the
terms of MCA Title 7 Chapter 3 Part 43; and
WHEREAS, FCEDA is a corporate public body duly organized and in existence pursuant to
the terms of MCA Title 7, Chapter 14, Part 11 enabling the creation of a Port
Authority and by Resolution No. 1346 of the Flathead County Commissioners for
the stated purposes of stimulating commerce, maximizing employment
opportunities and expanding the tax base; and
WHEREAS, in 2011 the City utilized its Brownfields Program, funded by an EPA Assessment
grant, to conduct Phase I and Phase II environmental site assessments at the
McElroy and Wilken gravel pit site, [hereinafter referred to as "the Property"],
located adjacent to what would become the Kalispell Core Area, for the purposes
of mitigation and preparation of the property for development; and
WHEREAS, on December 17, 2012 the Kalispell City Council, through Resolution No. 5601,
adopted an amendment to its Growth Policy referred to as the "Kalispell Core
Area Plan" based upon the findings of fact it accepted and approved in Kalispell
Planning Department staff report #KGPA- 12-01; and
WHEREAS, on February 4, 2013 the Kalispell City Council, through Resolution No. 5605,
adopted the Kalispell Core Area Plan as an amendment to the Kalispell West Side
Urban Renewal District Plan, making elements of the plan eligible for Tax
Increment Fund financing; and
Memorandum of Understanding — Page 1
WHEREAS, essential elements of the Kalispell Core Area Plan are the removal of the railroad
tracks traversing it, as well as removing the industries served by rail to a location
outside of the Core Area; and
WHEREAS, in February, 2012, for the purpose of developing a rail park, FCEDA purchased
the former McElroy and Wilken gravel pit site (the Property) for the sum of
$890,000,, funded partially by a grant from the US Department of Commerce
Economic Development Administration; and
WHEREAS, on April 21, 2014 the Kalispell City Council, by Resolution No. 5669 and upon
request of FCEDA, annexed the Property into the City for the provision of City
services and at the same time provided a zoning designation compatible for its use
as a rail park; and
WHEREAS, on May 5, 2014 the Kalispell City Council, by Resolution No. 5673 and upo 11
request of FCEDA, conditionally approved a preliminary plat of the Propertt
setting forth a plan for developing the property as a rail park; and
WHEREAS, the City and FCEDA collaborated in the years 2013 and 2014 in applications to
the US Department of Transportation for Transportation Investment Generating
Economic Recovery (TIGER) grants for the purposes of funding the development
of the Property as a rail park; and
WHEREAS, based upon the actions taken by the parties recited herein, there is clear evidence
of the desire and commitment of the parties to obtain the mutual benefits of a rail
park developed and operative upon the Property; and
WHEREAS, the City and FCEDA therefore seek to continue to cooperate in the search for
grant funding to develop the property and to that end recognize the need to obtain
the final engineering for a rail park on the Property; and
WHEREAS, FCEDA, as a governmental entity, utilizes the same statutorily requisite
procurement processes as the City in obtaining and contracting with professional
services and the City may therefore legally contribute to the costs of such services
contracted through FCEDA; and
WHEREAS, it is to the mutual advantage of the pal -ties that they share equally in the costs of
the final engineering for Phase I of the rail park on the Property.
Memorandum of Understanding — Page 2
N -0 W THEREFORE, THIS MEMORANDUM OF UNDERSTANDING IS
EXPRESSED AND AGREED UPON by and between the City and FCEDA each a loc
government agency of the State of Montana, that it is to their mutual benefit to adopt thi
Agreement as follows:
PURPOSE: The purpose of this Memorandum of Understanding is to set forth the intent and
agreement of the parties to share in the costs of engineering of Phase I of the development of the
rail park and, in particular, the costs of the final engineering to establish, in part, a basis of cost
analysis of the Project and further funding strategies.
1). FCEDA shall remain primarily liable in any contract for professional engineering and
remain the sole administrator of the contract.
2.) FCEDA shall promptly provide the City with a copy of the contract and all invoices
from its contracted professional engineers on the project.
3.) FCEDA shall promptly invoice the City for 50% of the invoice received from its
contracted professional engineers, which the City shall promptly pay to FCEDA.
EFFECTIVE DATE: The effective date of this agreement shall be upon the execution of this
document as authorized by the governing bodies of each party.
APPLICABLE LA W.- The parties agree that this Agreement is governed in all respects by the
laws of the State of Montana and the parties expressly agree that venue will be in Flathead
County, Montana, and no other venue.
NO THIRD -PARTY BENEFICIARY: This Memorandum of Understanding is for the exclusive
benefit of the parties, does not constitute a third -party beneficiary agreement, and may not be
relied upon or enforced by a third party.
COUNTERPARTS: This Agreement may be executed in counterparts, which together constitute
one instrument.
AUTHORITY: Each party represents that it has full power and authority to enter into and
perform this Agreement and the person signing this Agreement on behalf of each party has been
properly authorized and empowered to sign this Agreement.
Memorandum of Understanding — Page 3
Dated this day of January, 2015.
CITY OF KALISPELL
Mark Johnson, Mayor
FLATHEAD COUNTY ECONOMIC
DEVELOPMENT AUTHORITY
By:
Turner Askew, Chairman
Memorandum of Understanding — Page 4
STATE OF MONTANA
: ss.
County of Flathead
On this day of January, 2015, before me the undersigned, a Notary Public for the State of
Montana, personally appeared MARK JOHNSON, 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
her authorized capacity as Mayor of the CITY OF KALISPELL.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the date and
year first above written.
STATE OF MONTANA
: ss.
County of Flathead
Printed Name:
Notary Public for the State of Montana
Residing at
My Commission expires:
On this jtj7 day of January, 2015, before me the undersigned, a Notary Public for the State of
Montana, personally appeared TURNER ASKEW, 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 his
authorized capacity as Chairman of the FLATHEAD COUNTY ECONOMIC
DEVELOPMENT AUTHORITY.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the date and
year first above written.
8 -
;Printed Name: �e t
a3
Notary Public for the State of Montana
Residing at V-spe LA ,
My Commission expires:
Memorandum of Understanding — Page 5