ITEM 3.5 KCS Assessment0
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Request for
City Council Action
ORIGINATING DEPARTMENT:
REQUESTOR:
MEETING DATE:
Planning
City Planner Licht
22 September 2014
PRESENTER(s):
REVIEWED BY:
ITEM #:
Consent Agenda
City Administrator Johnson
3.5 — KCS Assessment
AGENDA ITEM DETAILS
RECOMMENDATION:
City staff recommends approval of the request to assess the utility connection charges for the expansion
of Kaleidoscope Charter School.
ARE YOU SEEKING APPROVAL OF A CONTRACT? I IS A PUBLIC HEARING REQUIRED?
Yes. I No.
BAC KG RO U N D/J U ST I F I CATION:
Kaleidoscope Charter School has received City approval for a 29,598 square foot expansion of its existing
43,015 square foot building that will allow for the education program to serve Kindergarten through 12th
grade students. KCS Building Company, which owns the Kaleidoscope Charter School property and
building, has requested assessment of the sewer and water connection fees due with the expansion of
the building. City staff has calculated the utility connection charges due with the issuance of the
building permit in accordance with Chapter 6, Section 1 of the City Code as follows:
■ Sewer: 24.2 RECs x $6,598.00/REC = $159,671.00
■ Water: 24.2 RECs x $1,566.00/REC = -$ 37,897.00
■ SUBTOTAL= $197,568.00
■ Temp classrooms remaining credit: $ 29,529.00
■ TOTAL- $168,039.80
The City Attorney has drafted an agreement for assessment of the utility connection charges for five
years at 3.4 percent interest consistent with Section 6-4-5.D.2 of the City Code for special assessments
for public improvements.
SUPPORTING DOCUMENTS: ❑ ATTACHED ❑ NONE
A. KCS letter dated 8/21/14
B. Assessment agreement
C. Resolution 2014-61
POSSIBLE MOTION
Please word motion as you would like it to appear in the minutes.
Motion to adopt Resolution 2014-61 approving an agreement between the City of Otsego and KCS
Building Company regarding payment and assessment of City utility connection charges.
BUDGET INFORMATION
FUNDING: BUDGETED: ❑ YES
NA ❑ No
kCTION TAKEN
❑ APPROVED AS REQUESTED ❑ DENIED ❑ TABLED ❑ OTHER (List changes)
COMMENTS:
8/21/14
Otsego City Council
13400 - 90th Street NE
Otsego, MN 55330
Dear City Council Members,
For the expansion project at 7525 Kalland Avenue, the Kaleidoscope Building Company respectfully
requests the Otsego City Council to consider assessing the remaining WAC/SAC charges due. This
would free up dollars in the construction budget to help us build a high quality school for the students
in the community. We would appreciate the assessment be paid out over a seven year period or
greater.
Thank you for your consideration and for your efforts to date; working with the Kaleidoscope Charter
School and Building Company to complete this project.
Sincerely,
Greg Buhl
Kaleidoscope Building Company
Chairman of the Board
CITY OF OTSEGO
COUNTY OF WRIGHT
STATE OF MINNESOTA
AGREEMENT BETWEEN THE CITY OF OTSEGO AND KCS BUILDING
COMPANY REGARDING PAYMENT AND ASSESSMENT OF CITY SAC
AND WAC FEES
THIS AGREEMENT made this day of September, 2014 between the City of
Otsego, a Minnesota Municipal corporation ("CITY") and KCS Building
Company, a Minnesota corporation ("KCS").
WHEREAS, KCS owns certain property located within the CITY and legally
described as follows:
Lot 1, Block 1 and Outlot A, DARA GLEN ADDITION according to the Plat on
file and of record at the Office of the County Recorder, Wright County,
Minnesota.
WHEREAS, due to the need for the construction of classrooms and other
facilities to accommodate additional students, KCS is required to incur additional
charges for delivery of to municipal sanitary sewer and water facilities ;and
WHEREAS, the CITY Sewer Connection Charge and CITY Water Connection
Charge for the expanded facility, due immediately upon hookup, are (Sewer) 24.2
RECs x $6,598.00 per REC = $ 159,671.00; and (Water) 24.2 RECs x $1,566.00
per REC= 37,897.00. The total charges equal $197,568.80. KCS has a remaining
credit of $29,529.00. Therefore, subtracting the credit, the total for Sewer
connection charges and Water connection charges due is $168,039.80.
WHEREAS, KCS has requested that said charges be assessed against the above
described property in equal annual installments over a period of seven (7) years;
and
WHEREAS, CITY agrees to the request as modified below, contingent upon KCS
executing this Agreement, which shall be recorded against the property.
NOW THEREFORE IT IS AGREED BETWEEN THE PARTIES AS
FOLLOWS;
1. CITY agrees to assess the principal amount of $ 168,039.80 against the
above described property for a period of five (5) years in equal annual
installments at an interest rate of 3.4% per annum.
2. KCS, on behalf of itself and its successors in title, hereby request the
assessment above and agree that the above described property benefits in at
least the amount of the assessment stated above, and that they waive any
hearings, any irregularities in procedure, and any and all right of appeal
under statute, Constitution, or case law, including the right of appeal under
Minnesota Statute 429.081 or any rights under Minnesota Statute 444.
3. This Agreement shall run with the land, shall be recorded against the title to
the property and shall be binding on all parties having any right, title or
interest in the property their heirs, successors and assigns.
4. In the event that KCS, or its successors, fails to timely pay the assessments
as they become due on the property the CITY, at its sole discretion, may
demand immediate payment of the entire principal and interest due at the
time and upon such demand KCS shall make such payment in full within
thirty (30) days of the demand.
5. In the event that CITY must take action to enforce the terms and conditions
of this Agreement related to prompt payment, KCS, or its successors, shall
reimburse CITY for all costs incurred by CITY in enforcement, including
reasonable attorney's fees.
2
CITY OF OTSEGO
Jessica Stockamp, Mayor
Tami Loff, City Clerk
KCS BUILDING COMPANY
By:
Its
STATE OF MINNESOTA)
) ss.
COUNTY OF WRIGHT )
The foregoing instrument was acknowledged before me this day of September,
2014, by Jessica Stockamp, Mayor and Tami Loff, City Clerk of the City of
Otsego, a Minnesota municipal corporation, on behalf of the City and pursuant to
the authority of the City Council.
NOTARY PUBLIC
STATE OF MINNESOTA)
3
) ss.
COUNTY OF WRIGHT )
The foregoing was acknowledged before me this day of September, 2012 by
the of KCS Building Company, a
Minnesota corporation, with authority and on behalf of the corporation.
NOTARY PUBLIC
DRAFTED BY:
MACARTHUR LAW OFFICE, LLC
3601 Thurston Avenue North
Suite 103
Anoka, MN 55303
(763) 231-5850
rd
CITY OF OTSEGO
COUNTY OF WRIGHT
STATE OF MINNESOTA
RESOLUTION NO. 2014-61
RESOLUTION APPROVING AGREEMENT BETWEEN THE CITY OF
OTSEGO AND KCS BUILDING COMPANY REGARDING ASSESSMENT
OF UTILITY CONNECTION CHARGES
WHEREAS, KCS Building Company has recently received City approval for an
expansion of Kaleidoscope Charter School; and
WHEREAS, the expansion requires the payment of $168,039.80 in sanitary sewer
and water utility connection charges which are due at the time a building permit is
issued; and
WHEREAS, KCS Building Company has, by letter, requested that the City
Council allow these utility connection charges to be assessed against the property;
and
WHEREAS, the City has presented to KCS the attached Agreement regarding
assessment of the above mentioned utility connection charges; and
WHEREAS, the Agreement sets forth the terms and conditions of the assessment
against the property and remedies available to City in the event of failure to make
payments as they become due, and other items.
NOW, THEREFORE BE IT RESOLVED by the City Council of the City of
Otsego, Wright County, Minnesota as follows;
1. The attached Agreement between the City of Otsego and KCS Building
Company Regarding Payment And Assessment Of City Utility Connection
Charges is hereby approved.
2. The Mayor and City Clerk are hereby authorized to execute the Agreement
on behalf of the City of Otsego.
ADOPTED this 22nd day of September, 2014 by the City Council of Otsego.
MOTION TO ADOPT the Resolution by Council Member
and seconded by Council Member
IN FAVOR:
OPPOSED:
CITY OF OTSEGO
Jessica Stockamp, Mayor
Tami Loff, City Clerk
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