RES 2022-76 Approving a Site Improvement Performance Agreement for Lot 3, Block 1 Autumn Woods Commercial AdditionCITY OF OTSEGO
COUNTY OF WRIGHT
STATE OF MINNESOTA
RESOLUTION NO: 2022-76
APPROVING A SITE IMPROVEMENT PERFORMANCE AGREEMENT
FOR LOT 3, BLOCK 1 AUTUMN WOODS COMMERCIAL ADDITION
WHEREAS, GAGCO Properties, LLC (the "developer") is proposing development of Lot 3, Blocl< 1, Autumn
Woods Commercial Addition; and
WHEREAS, a Planned Unit Development -Conditional Use Permit and site and building plans for the
development were approved on 10 October 2022 by the City Council; and
WHEREAS, Section 11-9-7 of the Zoning Ordinance requires the developer to enter into a Site
Improvement Performance Agreement to provide the City construction and warranty securities for the
public and private improvements and to provide the City various remedies in the event that the developer
breaches the terms and conditions of said agreement; and
WHEREAS, those obligations are outlined and memorialized in the attached Site Improvement Performance
Agreement.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF OTSEGO, MINNESOTA:
1. The Site Improvement Performance Agreement attached hereto between the City of Otsego and
GAGCO Properties, LLC is hereby approved in form subject to modification of fees, charges, and
securities as approved by City staff.
2. The Mayor and City Clerlc are hereby authorized to execute the Site Improvement Performance
Agreement on behalf of the City of Otsego.
ADOPTED by the City Council of the City of Otsego this 10th day of October, 2022.
MOTION BY: Moores
SECONDED BY: Dahl
IN FAVOR: Stockamp, Dahl, Darkenwald, Goede, and Moores
OPPOSED: none
CITY OF OTSEGO
Ii ► f 1t,i
ATTEST:
Audra Etze`, City Clerk
2
(reserved foa° recordia7g information)
SITE IMPROVEMENT PERFORMANCE
AGREEMENT
(NEW CENTUR YSYSTEMS, INC.)
THIS SITE IMPROVEMENT PERFORMANCE AGREEMENT ("Agreement") dated
2022) by and between the CITY OF OTSEGO, a Minnesota municipal corporation
("City") and GAGCO PROPERTIES, LLC, a Minnesota limited liability company (the "Developer").
1. BACKGROUND.
A. The Developer has submitted to the City a site plan application and conditional use
permit on property in the City of Otsego, Minnesota, located at the east side of Queens Avenue north of
CSAH No. 36, legally described on Exhibit "A" attached hereto and made a part hereof (hereinafter referred
to as the "Subject Property").
B. The development of the above described property includes the construction two
industrial office and warehouse buildings having a total area of 24,900 square feet. Access to the property
shall be from Queens Avenue ("Improvements").
2. CONDITIONS OF APPROVAL. This Agreement is a condition of City site plan approval and
will be recorded against the Subject Property.
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3. PLANS. The Subject Property shall be developed in accordance with the following plans
which are on file with the City. The plans shall not be attached to this Agreement. If the plans vary from the
written terms of this Agreement, the written terms shall control. The plans are:
Plan A —Site Plan
Plan B —Grading and Drainage and Erosion Control Plan
Plan C —Utility Plan
Plan D —Landscape Plan '�
Plan E — New Building Floor Plan
Plan F —New Building Elevations Plan
Plan G —Lighting Photometric Plan
Plan H —Traffic Control Plan
No work can occur outside of the areas indicated on the plans without modifying this
Agreement or obtaining a separate grading permit.
4. EROSION CONTROL. The Developer is responsible for obtaining an MPCA Construction
Permit for the site as well as developing a SWPPP for the site prior to issuance of a building permit. The
permit requires that all erosion and sediment BMPs be clearly outlined in a SWPPP, Changes made
throughout construction must be documented in the SWPPP. All basin slopes and slopes adjacent to
wetlands must have erosion control blanket installed.
Additional erosion control measures may be required during construction as deemed necessary by
City staff. Any additional measures required shall be installed and maintained by the Developer.
5. LICENSE. Developer hereby grants the City, its agents, employees, officers and contractors
a license to enter the Subject Property to perform all work and inspections deemed appropriate by the City
in conjunction with site development.
6. CONSTRUCTION ACCESS. Construction traffic access and egress for grading, public utility
construction, and public street construction is restricted to access the Subject Property as approved by the
City Engineer.
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7. CITY ENGINEERING ADMINISTRATION AND CONSTRUCTION OBSERVATION. The
Developer shall pay for construction observation performed by the City's in-house engineering staff or
consulting engineer. Construction observation shall include part a full time inspection of proposed public
utilities and will be billed on hourly rates estimated to be five percent (5%) of the estimated construction
cost.
8. DRAINAGE AND GRADING. All grading, drainage, erosion control, and wetland impacts
are subject to review and approval of the City Engineer, which shall not be unreasonably denied, withheld,
or delayed. The plat shall be graded in accordance with the approved grading development and erosion
control plan, Plan "B". The plan shall conform to City of Otsegoispecifications. Within thirty (30) days
after completion of the grading and final establishment of ground cover or temporary stabilization
reasonably approved by the City, which shall not be unreasonably denied, withheld, or delayed, the
Developer shall provide the City with an "as constructed" grading plan certified by a registered land
surveyor or engineer that all storm water treatment/infiltration basins and swales, have been constructed
on public easements or land owned by the City. The "as constructed" plan shall include field verified
elevations of the following: a) cross sections of storm water treatment/infiltration basins; b) location and
elevations along all swales, wetlands, wetland mitigation areas if any, locations and dimensions of borrow
areas/stockpiles, and installed "conservation area" posts; and c) lot corner elevations and building pads.
The City will withhold issuance of a Certificate of Occupancy until the approved certified grading plan is
on file with the City and all erosion control measures are in place as reasonably determined by the City
Engineer. The soils observation and testing report, including referenced development phases and lot
descriptions, shall be submitted to the Building Official for review prior to the issuance of the Certificate of
Occupancy.
Retaining walls over four feet in height shall be constructed in accordance with plans and
specifications prepared by a structural or geotechnical engineer licensed by the State of Minnesota.
Following construction, a certification signed by the design engineer shall be filed with the Building Official
evidencing that the retaining wall was constructed in accordance with the approved plans and
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specifications. All retaining walls identified on the development plans and by special conditions referred
to in this Agreement shall be constructed before any other building permit is issued for a lot on which a
retaining wall is required to be built. All retaining walls must comply with the City's engineering manual
and the City's zoning ordinance.
9. STREETS. The Developer agrees to maintain the area of Queens Avenue under construction
for access to utilities and curb cuts until the base course bituminous surfacing has been accepted by the City.
Should the City be required to grade the street prior to paving, the cost of such grading shall be paid by the
Developer and drawn from the Developer's letter of credit. Should the City determine that snowplowing is
necessary prior to street paving, the City will plow the streets) prior to acceptance of the streets. The
Developer shall hold harmless and indemnify the City from any and all liability related to this snow plowing
and shall pay all costs associated with this snow plowing. Any plowing undertaken by the City shall constitute
no acceptance or evidence of acceptance of the streets) in question.
The Developer shall complete all necessary street repaving and replacement by November 11, 2022.
If the street repaving is not completed by November 11, 2022, the City shall have the ability to draw on the
security provided by the Developer and complete the work.
10. ON SITE SEWAGE TREATMENT SYSTEMS. The Developer shall install and maintain
septic holding tanks in accordance with Section 9-5-4.D.3 of the Otsego City Code. The Developer
must install a level alarm within the tanks that includes an audible horn and strobe light visible from a
public street. The alarm must include a feature that will notify the property owner and a licensed
maintenance contractor by text message when the tank is full and the property owner and contractor
must respond to this alarm within reasonable time. The Developer shall maintain a contract on file with
the Building Official for pumping of the septic holding tanks with a licensed maintenance contractor and
shall submit records of required pumping and other maintenance to the Building Official.
11. CLEAN UP. The Developer shall clean dirt and debris from streets that has resulted from
construction work by the Developer, subcontractors, their agents or assigns. Prior to any construction on the
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Subject Property, the Developer shall identify in writing a responsible party and schedule for erosion control,
street cleaning, and street sweeping.
An LANDSCAPING. Landscaping shall be installed in accordance with the approved landscape
plan. The Developer shall post a $25,365,00 landscaping security upon issuance of a building permit to
ensure that the landscaping is installed in accordance with the approved plan. All new plants shall be
guaranteed for one year from the time planting has been completed. All plants shall be alive and
in satisfactory growth at the end of the guarantee period or be replaced by the property owner.
13. SPECIAL PROVISIONS. The following special provisions shall apply to this Agreement:
A. Implementation of the conditions listed in the Findings of Fact and Decision
approved by the City Council on October 10, 2022.
B. The exterior finish of Building 1 and Building 2 shall comply with Section 11-17-4.E.3
of the Zoning Ordinance.
C. The minimum setback of off-street parking stalls or drive aisle from the right-of-way of
Queens Avenue shall be subject to review and approval by the City Engineer.
D. The Developer shall surface parking areas and drive aisles which shall be surrounded
by perimeter concrete curb as required by Section 11-21-7.0 and D of the Zoning
Ordinance, subject to review and approval of the City Engineer.
E. The Developer shall submit a landscape plan subject to review and approval of the
Zoning Administrator as required by Section 11-19-2.B addressing:
1. The Developer shall landscape all areas of the subject site not taken up by
buildings or drive aisles with turf or natural grass.
2. The Developer shall plant a mix of shade and evergreen trees east of the off-
street parking area and south of Building 2.
3. The Developer shall plant shade trees in the yard south of the off-street parking
area at 50 feet on center.
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4. The Developer shall plant evergreens or clumps of tall growing native grasses
on the no, side of Building 1.
F. The Developer shall irrigate landscaped areas in compliance with Section 5-2-8.c.2 of
the City Code.
G. All signs shall comply with Section 37 of the Zoning Ordinance, subject to review and
approval of the Zoning Administrator.
H. The Developer shall submit a photometric lighting plan and all exterior lighting shall
comply with Section 11-16-6 %J the Zoning Ordinance, subject to review and approval
of the Zoning Administrator.
Any exterior storage of waste and recycling containers shall comply with Section 11-
18.4.0 of the Zoning Ordinance, subject to review and approval of the Zoning
Administrator.
J. All utility issues shall be subject to review and approval of the Building Official.
K. All grading, drainage, wetland impacts, and erosion control issues shall be subject to
review and approval of the City Engineer.
14. SECURITY. To ensure compliance with the terms of this Agreement, and construction of all
public improvements, and satisfaction of all other obligations, the Developer shall furnish the City with a cash
escrow or Irrevocable Standby Letter of Credit with automatic renewal provisions in the amount as required
under this Agreement. The issuer and form of the security (other than cash escrow) shall be subject to City
approval in its reasonable discretion. The security shall be issued by a banking institution in good standing
as determined by the City and approved by the City Administrator. The City shall have the ability to draw on
the security at a bank or branch bank located within fifty (50) miles of the City Hall. The security shall contain
an automatic renewal provision and shall not expire until all the Development is complete and fully and finally
accepted by the City, and all terms of this Agreement are satisfied.
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The City may draw down the security, on five (5) business days written notice to the Developer, for
any violation of the terms of this Agreement or without notice if the security is allowed to lapse prior to the
end of the required term. If the required public improvements are not completed Clt least thirty (30) days prior
to the expiration of the security, the City may also draw it down without notice. If the security is drawn down,
the proceeds shall be used to cure the default.
Upon receipt of proof satisfactory to the City that work has been completed and financial obligations
to the City have been satisfied, with City approval not to be unreasonably withheld or delayed, the security
shall be reduced from time to time in proportion to the work completed, but not below ten (10) percent which
is the amount of the warranty security. For purposes of this Section, the warranty period shall be a twelve
(12) month period after the applicable work has been completed, except with respect to streets, for which the
warranty period shall be two years as addressed elsewhere in this Agreement.
This security amount shall be submitted to the City prior to execution of the Agreement. All
administrative and legal fees related to plan review, drafting of this Agreement and any other necessary items
shall be paid to the City prior to execution of the Agreement, which are in the aggregate amount of $28,268.75.
Upon completion of the work contemplated hereunder and expiration of the warranty period, the remaining
security shall be promptly released to Developer.
15. SUMMARY OF SECURITY REQUIREMENTS. The amount of the security described above
is calculated as follows:
CONSTRUCTION COSTS:
A. Streets $10,000.00
TOTAL SUBTOTAL: $10,000.00
OTHER COSTS:
A. Engineering &Surveying Construction Services (6.5%) $10,000.00
B. Landscaping $25,365.00
OTHER COSTS SUB -TOTAL $35,365.00
TOTAL . SUBTOTAL $45,365.00
TOTAL IRREVOCABLE LETTER OF CREDIT $56,706.25
FOR SECURITY (125% OF SUBTOTAL
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ESCROW
A. City Legal Expenses (Minimum Escrow)
B. City Construction Observation (Minimum Escrow)
C. GIS Data Entry Fee
ESCROW TOTAL
DEVELOPMENT WARRANTY LETTER OF CREDIT
A. Streets
B. Landscaping
TOTAL WARRANTY LETTER OF CREDIT
$1,500.00
$10,000.00
$11,750.00
$4,000.00
$2,536.50
$6,536.50
16. SUMMARY OF CASH REQUIREMENTS. The following is a summary of the cash
requirements under this Contract which must be furnished to the City prior to the City Council signing the
final plat:
A. City Administrative (Minimum Fee) $1,500.00
TOTAL CASH REQUIREMENTS $11500.00
17. ACKNOWLEDGEMENT. The Developer acknowledges that approval of installation of the
Improvements does not constitute a guarantee by the City of any future subdivision approvals and that the
Developer performs the work on the Subject Property at its own risk.
18. RESPONSIBILITY FOR COSTS.
A. The Developer shall pay all costs incurred by it or the City in conjunction with the
development of the Subject Property, including but not limited to legal, planning, engineering and inspection
expenses incurred in connection with approval of the site plan, the preparation of this Agreement, review of
any other plans and documents.
Be
The Developer shall hold the City and its officers, employees, and agents harmless
from claims made by itself and third parties for damages sustained or costs incurred resulting from site
approval and development. The Developer shall indemnify the City and its officers, employees, and agents
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for all costs, damages, or expenses which the City may pay or incur in consequence of such claims, including
attorneys' fees. Notwithstanding anything contained within this Section 21(B), Developer shall not be
obligated to indemnify or defend the City from and against claims based on any negligence or willful
misconduct by the City, its employees, agents or contractors, or the failure of the City to act in accordance
with City ordinances and other applicable laws.
C. The Developer shall reimburse the City for costs incurred in the enforcement of this
Agreement, including engineering and attorneys' fees.
D. The Developer shall pay in full all bills submitted to it by the City for obligations incurred
under this Agreement within thirty (30) days after receipt. Bills not paid within thirty (30) days shall accrue
interest at the rate of eight percent (8%) per year.
19. MISCELLANEOUS.
A. Third parties shall have no recourse against the City under this Agreement.
B. If any portion, section, subsection, sentence, clause, paragraph, or phrase of this
Agreement is for any reason held invalid, such decision shall not affect the validity of the remaining portion
of this Agreement.
C. The action or inaction of the City shall not constitute a waiver or amendment to the
provisions of this Agreement. To be binding, amendments or waivers shall be in writing, signed by the parties
and approved by written resolution of the City Council
enforce this Agreement shall not be a waiver or release.
The City's failure to promptly take legal action to
D. This Agreement shall run with the land and may be recorded against the title to the
Subject Property. The Developer covenants with the City, its successors and assigns, that the Developer
has fee title to the Subject Property and/or has obtained consents to this Agreement, in the form attached
hereto, from all parties who have an interest in the Subject Property; that there are no unrecorded interests
in the Subject Property; and that the Developer will indemnify and hold the City harmless for any breach of
the foregoing covenants.
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E. Each right, power or remedy herein conferred upon the City is cumulative and in
addition to every other right, power or remedy, express or implied, now or hereafter arising, available to City,
at law or in equity, or under any other agreement, and each and every right, power and remedy herein set
forth or otherwise so existing may be exercised from time to time as often and in such order as may be
deemed expedient by the City and shall not be a waiver of the right to exercise at any time thereafter any
other right, power or remedy.
F. Breach of the terms of this Agreement by the Developer, including nonpayment of
billings from the City, shall be grounds for denial of building permits and certificates of occupancy, and the
halting of all work on the Subject Property.
G. The Developer represents to the City that the development complies with all City,
county, metropolitan, state, and federal laws and regulations, including but not limited to: subdivision
ordinances, zoning ordinances, and environmental regulations. If the City determines that the development
does not comply, the City may, at its option, refuse to allow construction or development work in the
development until the Developer does comply. Upon the City's demand, the Developer shall cease work
until there is compliance.
20. DEVELOPER'S DEFAULT. In the event of default by the Developer as to any of the work to
be performed by it hereunder, the City may, at its option, perform the work and the Developer shall promptly
reimburse the City for any expense incurred by the City, provided the Developer, except in an emergency as
determined by the City, is first given notice of the work in default, not less than ten (10) days in advance.
This Agreement is a license for the City to act, and it shall not be necessary for the City to seek a Court order
for permission to enter the Subject Property. When the City does any such work, the City may, in addition
to its other remedies, assess the cost in whole or in part.
21. NOTICES. Required notices to the Developer shall be in writing, and shall be either hand
delivered to the Developer, its employees or agents, or mailed to the Developer by certified mail at the
following address: 20150 75th Avenue North, Suite B, Corcoran, Minnesota 55340. Notices to the City
shall be in writing and shall be either hand delivered to the City Administrator, or mailed to the City by
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certified mail in care of the City Administrator at the following address: Otsego City Hall, 13400 90th
Street NE, Otsego, Minnesota 55330.
{Remainder of page is intentionally left blank.
Signature pages to follow.}
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CITY OF OTSEGO
BY:
(SEAL)
STATE OF MINNESOTA )
)ss.
COUNTY OF WRIGHT )
Jessica L. Stockamp, Mayor
Audra Etzel, City Clerk
The foregoing instrument was acknowledged before me this day of ,
2022) by Jessica L. Stockamp and by Audra Etzel, the Mayor and City Clerk of the City of Otsego, a
Minnesota municipal corporation, on behalf of the corporation and pursuant to the authority granted by its
City Council,
NOTARY PUBLIC
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2022, by
of GAGCO PROPERTIES, LLC
DEVELOPER:
GAGCO PROPERTIES, LLC
By:
STATE OF MINNESOTA
COUNTY OF
The foregoing instrument was acknowledged before me this day of ,
the
a Minnesota limited liability company, on behalf of said entity.
NOTARY PUBLIC
DRAFTED BY:
CAMPBELL,KNUTSON
Professional Association
860 Blue Gentian Road, Suite 290
Eagan, Minnesota 55121
Telephone: 651452-5000
AM P/smt
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EXHIBIT "A"
TO
SITE IMPROVEMENT PERFORMANCE AGREEMENT
Lot 3, Block 1, Autumn Woods Commercial, according to the plat thereof on file or of record
in the office of the County Recorder, Wright County, Minnesota. EXCEPT that part shown
as Parcel 302B on Minnesota Department of Transportation Right of Way Plat No. 8&107.
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[BANK LETTERHEAD]
IRREVOCABLE LETTER OF CREDIT
TO: City of Otsego
City Hall
13400 90th Street NE
Otsego, Minnesota 55330
Dear Sir or Madam:
No. _
Date:
We hereby issue, for the account of (Name of Developer) and in your favor, our Irrevocable
Letter of Credit in the amount of $ available to you by your draft drawn on sight on the undersigned
bank.
The draft must:
a) Bear the clause, "Drawn under Letter of Credit No. ,dated , 2 ,
of (Name of Bank) ";
b) Be signed by the City Administrator or Finance Director of the City of Otsego.
c) Be presented for payment at (Address of Bank) , on or before 4:00 p.m. on November 30,
2
This Letter of Credit shall automatically renew for successive one-year terms unless, at least forty-five (45)
days prior to the next annual renewal date (which shall be November 30 of each year), the Bank delivers written
notice to the Otsego Finance Director that it intends to modify the terms of, or cancel, this Letter of Credit. Written
notice is effective if sent by certified mail, postage prepaid, and deposited in the U.S. Mail, at least forty-five (45)
days prior to the next annual renewal date addressed as follows: Otsego Finance Director, Otsego City Hall,
13400 90th Street NE, Otsego, MN 55330, and is actually received by the Finance Director at least thirty (30) days
prior to the renewal date.
This Letter of Credit sets forth in full our understanding which shall not in any way be modified, amended,
amplified, or limited by reference to any document, instrument, or agreement, whether or not referred to herein.
This Letter of Credit is not assignable. This is not a Notation Letter of Credit. More than one draw may be
made under this Letter of Credit.
This Letter of Credit shall be governed by the most recent revision of the Uniform Customs and Practice
for Documentary Credits, International Chamber of Commerce Publication No. 600.
We hereby agree that a draft drawn under and incompliance with this Letter of Credit shall be duly honored
upon presentation.
[NAME OF BANK]
BY:
Its
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