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HomeMy WebLinkAbout#05 - Focus Facility Use AgreementSTAFF REPORT DATE: March 19, 2024 Consent AGENDA ITEM: Focus Engineering Facility Use Agreement TO: Mayor and City Council SUBMITTED BY: Julie Johnson, City Clerk REVIEWED BY: Clark Schroeder, Sarah Sonsalla BACKGROUND: The old city hall building at 3800 Laverne Avenue North has been sitting empty for almost a year. It is uncertain at this time what the future use of the building will be. For the foreseeable future, it functions as a polling location and the old council chambers is used by the public for meetings such as HOA meetings, neighborhood meetings and other groups of residents for prayer groups and hobby related groups. Although the building is used 1-2 times per month, staff feel it would be beneficial for the building to be occupied on a more regular basis. Focus Engineering was recently notified that the space they were renting would no longer be available. In the past, Focus was located in the Brookfield Building, next to the city offices. Staff found it invaluable to have the Focus staff in close proximity for impromptu meetings, questions and also for questions from residents. ISSUE BEFORE COUNCIL: Should Council approve the Facility Use Agreement with Focus Engineering? PROPOSAL: City Attorney Sonsalla has prepared a Facility Use Agreement with Focus Engineering (see attached). There are limitations for the city to act as a landlord which is the reason for the use agreement versus a lease. Staff feel that there is a benefit to the city in having the building occupied and monitored on a regular basis, as well as the benefit to staff and residents with easy access to the Focus Engineering team. As noted in the use agreement, Focus will reimburse the city for the monthly energy costs and will allow continued use of the council chambers for residents and elections. The term of the agreement runs concurrent with the city’s engineering services agreement with Focus. FISCAL IMPACT: Reduction in energy bills for the building at 3800 Laverne and reduced risk of repairs for damage and system malfunctions that could occur and go unnoticed if the building is vacant. OPTIONS: 1) Approve Agreement 2) Amend and then approve Agreement 3) Do not approve Agreement RECOMMENDATION: Motion to approve Facility Use Agreement with Focus Engineering. ATTACHMENTS: • Facility Use Agreement 1 LA515\1\936732.v3 FACILITY USE AGREEMENT THIS AGREEMENT is made and entered into as of this 23rd______ day of May________, 2024, by and between the CITY OF LAKE ELMO, a municipal corporation and political subdivision of the State of Minnesota, (the “City”) and FOCUS ENGINEERING, INC., a corporation in the State of Minnesota (“Focus”). Recitals A. The City is the owner of property located at 3800 Laverne Avenue North that contains offices and a city council chambers (the “City Property”); and B. The City Property “Office Space” consists of three offices, a small kitchenette, and a large open office/conference area (“Office Space”). The City Property “Common Space” consists of the city council chambers, front entrance area, and two restrooms (“Common Space”). C. Focus provides engineering services to the City; and D. Focus has requested that it be able to use the Office Space and the restrooms in the Common Space, hereinafter referred to “Use Area”, so that it may meet with City staff and officials in a location near City Hall which is located on the adjacent property (3880 Laverne Avenue N.); and E. The City has agreed to allow Focus to use the Use Area for these purposes on a short-term basis, provided that Focus reimburse the City for the building’s electric costs; and F. The City and Focus desire to enter into this Agreement setting for the terms by which Focus will use the Use Area. NOW THEREFORE, in consideration of the Use Area and in further consideration of the mutual agreements contained in this Agreement, the City and Focus agree as follows: 1. Term and Termination. This Agreement is valid on May 23________, 2024. This Agreement shall terminate 60 days after December 31, 2028[insert date of Focus services agreement]. Focus may terminate this Agreement at any time and for any reason by providing 30 days’ written notice to the City. The City may terminate this Agreement for any reason by providing 30 days’ written notice to Focus. 2. Payment. Focus shall pay $1.00 monthly to the City for Focus’s use of the Use Area as described in this Agreement. The parties agree that Focus’s use of the Use Area is not a “business subsidy” within the meaning of Minnesota Statutes Section 116J.993, subdivision 3 because Focus is responsible for reimbursing the City for its electricity costs associated with the City Property which would otherwise be paid by the City. 3. Use. Focus is granted exclusive use of the Use Area during the term of this Agreement, with the exception of the restrooms, which use shall be non-exclusive. Focus agrees that its use 2 LA515\1\936732.v3 of the Use Area is with the City’s permission and is not open, continuous, notorious, or in any other manner supportive of a claim of adverse possession, prescriptive easement, or other entitlement to the Use Area. The parties acknowledge that this Agreement is permission to use the Use Area for the purposes described herein and does not confer any estate or interest in the Use Area to Focus. 4. Focus’s Use of the City Property. Focus shall use the Use Area only for the activities described in this Agreement. Focus shall not create a nuisance or use the Use Area for any illegal or immoral purposes. 5. Compliance With Laws. The City does not warrant that the physical condition of the Use Area complies with all applicable laws, ordinances, rules and governmental regulations (“Applicable Laws”). The City will not be maintaining or repairing the City Property. Focus acknowledges that it accepts the Use Area and agrees to use the Use Area “AS IS” and “WHERE IS” and with all defects whether known or unknown. Focus shall not be responsible for repairs or corrections to restore any noncompliant issue with the Use Area. Focus shall use the Use Area in compliance with all Applicable Laws regarding the Use Area to the extent the Applicable Laws pertain to the particular manner in which Focus uses the Use Area or to its lawful use of the Use Area, such as laws governing maximum occupancy and illegal business operations. The City and Focus shall not use the City Property for the storage, handling, or disposal of any Hazardous Substance, Hazardous Waste, pollutant, or contaminant as those terms are defined in 42 U.S.C. § 9601 et. seq. (“CERCLA”) or Minnesota Statutes Chapter 115B (“MERLA”). 6. Services and Utilities. Focus shall be responsible for reimbursing the City for its electric utility costs associated with the City Property. Focus shall be responsible for paying the costs of any Internet service required by Focus for the Use Area. The City shall be responsible for cleaning and maintaining the restrooms in the Use Area. To the extent that the main front entrance to the building is utilized by the City or the public to access the Common Space, the City shall clear ice and snow from the entrance, parking lot, and the walkway. 7. Focus’s Use and Care of the Use Area. Focus shall: a. Keep the Use Area in good order (with the exception of the restrooms which shall be cleaned and maintained by the City). b. Use the rear entrance of the building to access the Use Area. c. Make repairs needed to the Use Area if repairs are needed due to Focus’s sole misuse or negligence. d. Maintain and clean the Use Area with the exception of the restrooms. This includes cleaning and depositing trash into proper receptacles. e. The City shall maintain and clean the portions of the Common Space that are used by the City and open to the public, including the restrooms. 3 LA515\1\936732.v3 f. Cooperate with the City staff person that is assigned to oversee the City Property. g. Pay for and provide any security measures necessary to secure its personal property in the Use Area. h. Provide access to the Use Area by the City staff, including allowing City staff, residents, and developers to meet with Focus representatives on the City Property in order to conduct City business. i. Be responsible for any personal property losses due to theft or vandalism occurring in the Use Area. j. Not allow any smoking, cannabis, tobacco, or alcohol use in the Use Area when Focus staff is present, however, Focus will not be responsible for any smoking or cannabis, tobacco, or alcohol use by City staff or members of the public when using the City Property. k. Upon termination of this Agreement, remove from the City Property all of its personal property. 8. Entry by the City. The City and its authorized representatives may enter the City Property at all times to conduct any activities as may be desirable in the sole discretion of the City. The City may allow the public to use the Common Space from time-to-time. 9. Alterations. Focus shall not make alterations to the Use Area without the City’s advance written consent. “Alterations” means additions, substitutions, installations, improvements, repairs, and similar changes to the physical condition of the Use Area. 10. Entire Agreement. This Agreement is the complete and exclusive statement of the terms agreed upon and shall supersede all prior negotiations, understandings or agreements. Any alterations, variations, modifications or waivers of the Agreement shall only be valid when they are agreed to in writing and signed by authorized representatives of Focus and the City. 11. Applicable Law. Minnesota law shall be used to construe and interpret this Agreement, without giving effect to the principles of conflict of laws. All proceedings related to this Agreement shall be venued in the State of Minnesota. 12. Data Practices Act. All of the data created, collected, received, stored, used, maintained, or disseminated by the City in the performance of this Agreement is subject to the requirements of the Minnesota Government Data Practices Act, Minnesota Statutes Chapter 13. 13. Indemnity. Focus shall defend, indemnify, and hold harmless the City, its officials, agents, contractors, and employees, against all suits, demands, causes of action, liabilities, or claims for injury or damages of whatever nature, including personal injury, death or damage to the Use Area, arising out of or related to Focus’s negligent use of the Use Area and the negligent use of the Use Area by Focus’s officers, employees, agents, participants, guests, and invitees. 4 LA515\1\936732.v3 Nothing in this Agreement shall be deemed a waiver by the City of the limitations on liability set forth in Minnesota Statutes Chapter 466. 14. Insurance. Focus at its expense, during the term of this Agreement, shall keep in full force and effect a policy or policies of occurrence based commercial general liability insurance, providing coverage for personal property damage, personal injury, and contractual liability. Focus shall provide the City with a certificate of insurance effective immediately with a minimum coverage of the City’s minimum statutory tort liability and naming the City as an additional insured. The sufficiency of the certificate of insurance is subject to the review and approval of the City. 15. Assignment. Neither party shall assign this Agreement or any of the rights or duties arising under this Agreement to any third party without the written consent of the other. 16. Notices. All notices required under this Agreement must be in writing and provided to the designated contact person for the other party. The parties shall keep each other informed in writing of any change in the designated contact person. At the time of the execution of this Agreement, the following persons are the designated contacts: Focus Contact City Contact Jack Griffin City Administrator Focus Engineering City of Lake Elmo 3800 Laverne Avenue N. 3880 Laverne Avenue N. Lake Elmo, MN 55042 Lake Elmo, MN 55042 17. Severability. If any portion of this Agreement is declared by a court to be illegal or in conflict with any law, the validity of the remaining terms and conditions shall not be affected and the rights and obligations of the parties under this Agreement shall be construed and enforced as if the Agreement did not contain the particular provision held to be invalid. 18. No Joint Venture or Partnership. This Agreement does not create the relationship of principal and agent or of partnership or of joint venture or of any association between the City and Focus, the sole relationship of the parties being that of owner and user under this Agreement. 5 LA515\1\936732.v3 IN WITNESS WHEREOF, the undersigned parties acknowledge that they have read and understand this Agreement and have executed it on the dates recorded below. FOCUS ENGINEERING, INC. Date:___________________ By: ______________________________________ Its: ______________________________________ CITY OF LAKE ELMO Date: ___________________ By:____________________________________ Charles Cadenhead Its: Mayor By:___________________________________ Julie Johnson Its: City Clerk