4.5. SR 03-18-2019 Eclty1� ,.,�� Request for Action
River
To Item Number
Mayor And Council 4.5
Agenda Section Meeting Date Prepared by
Consent March 18, 2019 Michael Hecker, Parks and Recreation Director
Item Description Reviewed by
Pinewood Management Agreement Cal Portner, City Administrator
Reviewed by
Lori Ziemer, Finance Director
Action Requested
Approve,by motion, the Pinewood Management Agreement
Background/Discussion
City Council reviewed the Pinewood Management Agreement at a work session on February 4, 2019, and
provided direction to staff. As requested by City Council, staff met with Chris Singer to review draft
language for a new three year agreement. Chris shared this draft agreement with his Board
The Agreement was reviewed by Attorney Roger Knutson. Some of the highlights in the new agreement
include the following:
■ Pay the city$1 each year to operate Pinewood for three years through 2022.
■ The city shall provide the operator a onetime sum of$10,000 for startup costs for only the first
year of operations. The $10,000 will be paid back to the city by December 1, 2019.
■ While the city is not requesting operating statements to be regularly furnished, the operator shall
make a presentation to City Council on an annual review by February of every year.
■ The operator shall be financially responsible for all equipment maintenance and repairs. If the
Operator decides to use the city for any repairs, they will be charged for such services.
■ Any capital improvements and equipment replacement will be agreed upon by the city and the
operator and shall be the responsibility of the city.
■ The operator shall set the fees for use of Pinewood.
Financial Impact
N/A
Attachments
■ Pinewood Golf Management Agreement
The Elk River Vision
A PehoMing community 2a itb revolutionary and spirited resourcefulness, exceptional POWERED By
service, and community engagement that encourages and inspires prosperity INAWRE1
PINEWOOD GOLF MANAGEMENT AGREEMENT
THIS AGREEMENT effective January 1, 2019 by and between the City of Elk River, a
Minnesota municipal corporation, at 13065 Orono Parkway, Elle River, Minnesota 55330 (hereinafter
"City") and Elk River Country Club, Inc. a Minnesota corporation d/b/a Elk River Golf Club at
20015 Elk Lake Road, Elk River, Minnesota 55330 (hereinafter "Operator").
WHEREAS, the City has owned and operated Pinewood Golf Course at 18150 Waco Street
NW, Elk River, Minnesota 55330 ("Golf Course" or"Pinewood"). Pinewood is a 9-hole executive
course with a 1,700 square foot clubhouse and a pole barn maintenance building; and
WHEREAS, the City has determined that the continued operation of the golf course would
serve a public purpose and provide a benefit to the residents of the City; and
WHEREAS, the Operator is engaged to manage the Golf Course; and
WHEREAS, the Operator will retain all revenues from the Golf Course and pay all expenses
relating to the operation of the Golf Course.
NOW, THEREFORE, the City and the Operator, for the consideration of$1 per year payable
April 1 each year do hereby mutually agree as follows:
1. Management. The City appoints the Operator as the manager of the Pinewood Golf
Course (hereinafter "Golf Course") in accordance with the terms of this Agreement. This appointment
is for the purpose of operating, managing and maintaining the Golf Course. The Golf Course shall be
deemed to include the equipment listed on Exhibit A, which shall be maintained by the Operator in as
good working condition as of the commencement date of this agreement, reasonable wear and tear
excepted. The equipment may only be used by the Operator for use on the Pinewood Golf Course.
2. Standards of Operation. Operator represents and warrants to City that it shall maintain
an efficient and high quality operation at the golf course comparable to other similar golf courses.
3. Term. This agreement shall be for a period commencing on the date first set forth above
and ending on the 31st day of December, 2021 provided however in addition to the termination
provisions in paragraph 26, that the City may terminate this Agreement at will, without cause, by
delivery (by mail or by personal service) to Operator(at its address stated hereinabove) of a notice of
the City's intention to terminate this agreement, one hundred and twenty (120) days after the delivery
of the notice. At the expiration of the one hundred and twenty (120) day period (a) this Agreement
shall terminate (b) the Operator shall, at its own cost and expense, immediately remove all of its
personal property from the Golf Course, and quit and surrender possession thereof to the City, in good
order and condition, subject to the terms and conditions herein. This agreement allows the City to
terminate the license at will. The Operator may request to extend this Agreement for an additional one
(1) year period, commencing on January 1, 2022 and ending on the 31st day of December, 2022, by
giving notice in writing to the City by delivering to the City Clerk by September 1, 2021 of its request.
The financial terms of such renewal shall be negotiated between the City and the Operator. Such
1
renewal is subject to City council approval. The City shall provide to the Operator a one-time sum of
$10,000 for startup costs with 0% interest for only the first year of operations. The $10,000 will be
paid back to the City by December 1, 2019.
4. Legal Compliance. The Golf Course shall be used, occupied, operated, maintained and
repaired so as to be in compliance with all statutes, ordinances, codes, rules and regulations. The
Operator shall maintain sole and complete discretion to determine and employ whatever methods,
practices and procedures it deems appropriate to assure the Golf Course remains in compliance with all
stated statutes, ordinances, local laws, codes, rules and regulations however, if such compliance
requires additional capital er-funding, the City will promptly provide such funding to allow the
Operator to ensure such compliance.
5. Indemnity. The Operator must defend, indemnify and hold harmless the City and its
officials, employees and agents and from any and all suits, claims, actions or causes of action of every
name and description brought against City for or on account of any death, injuries or damage received
or sustained by any party or parties from the negligence, gross negligence or willful misconduct of the
Operator arising from the Operators use of this agreement.
6. Insurance. The Operator shall take out and maintain during the term of this agreement
such commercial liability insurance as shall protect the Operator and the City from claims for damages
for personal and bodily injury including accidental death, as well as from claims for property damage,
which may arise from operations under this agreement. The City shall be named as an additional insured
on the commercial liability policy on a primary and non-contributory basis. Before commencing work,
the Operator shall provide the City a certificate of insurance evidencing the required insurance coverage in
a form acceptable to City. Such insurance shall be written for amounts not less than:
a) Commercial General Liability: A single limit policy in the amount of at least $2,000,000.00 per
occurrence for death or bodily injury and property damage liability claims, public liability
insurance, blanket contractual liability, broad form property damage liability and fire legal
liability.
b) Commercial Automobile Liability Insurance. The Operator is required to maintain insurance
protecting it from claims for damages for bodily injury and property damage resulting from the
ownership, operation, maintenance or use of automobiles which may arise from operations
under this agreement. Minimum limits are as follows:
$1,000,000 per occurrence Combined Single Limit for Bodily Injury and Property Damage.
In addition, the following coverages shall be included: Owned Hired, and Non-owned
Automobiles.
c) Workers Compensation Insurance: The Operator shall maintain Workers Compensation
insurance for its employees during the life of this agreement in accordance with the statutory
requirements of the State of Minnesota. In addition Employer's Liability Insurance shall be
provided with minimum limits are follows:
2
$500,000 —Bodily Injury by Disease per employee
$500,000 —Bodily Injury by Disease aggregate
$500,000 —Bodily Injury by Accident
d) The Operator shall maintain a blanket faithful performance bond of$250,000 that covers thefts
by the Operator and the Operator's employees.
The Operator shall furnish a copy of the above-described insurance policies (or a certificate showing
the issuance thereof) to the City and shall also name the City as the additional insured in
the Commercial General Liability and Commercial Automobile Liability policies on a primary and
non-contributory basis.
The Operator's policies and Certificate of Insurance shall contain a provision that coverage afforded
under the policies shall not be cancelled without at least thirty (30) days' advanced written notice to
the City, or ten (10) days' written notice for non-payment of premium.
An Umbrella or Excess Liability insurance policy may be used to supplement the Operator's policy
limits on a follow-form basis to satisfy the full policy limits required by this agreement.
If the Operator obtains a license to sell beer, wine or intoxicating liquor on the golf course premises,
the Operator, at its expense, shall be required to maintain liquor liability insurance in the minimum
amount of$1,000,000 for bodily injury, destruction of property of others, loss of means of support, and
other pecuniary loss in any one occurrence. The City shall be endorsed as an additional insured.
7. Damage/Injury. The Operator agrees to reimburse the City for any and all damages or
injury to any real property or personal property of the City that may arise, directly or indirectly, from
the intentional or negligence, acts or omissions of the Operator, its agents or employees. Any accident
involving significant property damage or bodily harm occurring at the Golf Course property shall be
reported to the Park and Recreation Director as soon as possible and not later than twenty-four (24)
hours from the time of such accident. A detailed, written report shall be submitted to the Park and
Recreation Director as soon as possible and not later than three (3) business days after the date of such
accident.
8. Independent Contractor. The City hereby retains Operator as an independent contractor
upon the terms and conditions set forth in this Agreement. Operator is not an employee of the City and
is free to contract with other entities as provided herein. Operator shall be responsible for selecting the
means and methods of performing the work. Operator shall furnish any and all supplies, equipment
(except as indicated on Exhibit A), and incidentals necessary for Operator's performance under this
Agreement. Operator agrees that Operator shall not at any time or in any manner represent that
Operator or any of Operator's agents or employees are in any manner agents or employees of the City.
Operator shall be exclusively responsible under this Agreement for Operator's and Operator's
employees FICA payments, workers compensation payments, unemployment compensation payments,
withholding amounts, and/or self-employment taxes if any such payments, amounts, or taxes are
required to be paid by law or regulation.
3
9. Employees. The Operator, in its sole and absolute discretion, shall hire its own staff to
operate, manage and maintain the Golf Course. The Operator shall be solely responsible for
determining staffing levels and qualifications and setting its employees' compensation, benefits, hours
and all other terms of employment.
10. Notices. Any and all notices and payments required hereunder shall be addressed to the
parties at their respective addresses listed on page 1 hereof, or to such other address as may hereafter
be designated in writing by either party hereto.
11. Maintenance. The Operator agrees to maintain the Golf Course and cause any required
repairs to be made at Operator's expense at the expiration of the term hereof, Operator shall deliver up
the Golf Course in good order and condition. Notwithstanding the foregoing, the City, at its sole cost
and expense, shall maintain, repair and replace, if necessary, the structural components of the
clubhouse. The Operator is required to keep the clubhouse in accordance with state health and local
building code requirements. The Operator will make repairs and prepare the clubhouse for each season,
which includes winterization of the clubhouse. The clubhouse shall be returned to the City in
substantially the same state that is was received by the Operator, reasonable wear and tear excepted.
The Operator shall maintain the Golf Course under the standards set forth in Exhibit B. The
Operator, however, in its sole discretion, shall determine what manners and procedures shall be
employed to meet those standards. The Operator, in its sole discretion, has the right to sell and place
signage on the Golf Course at each tee box, attached to the hole designation.
12. Accounting Standards. Operator shall maintain accounting records relating to the Golf
Course using accounting practices in accordance with generally accepted accounting principles
(GAAP). While the City is not requesting operating statements to be regularly furnished, the Operator
shall make a presentation to City Council on an annual review of Pinewood operations. The
presentation shall be made annually by the end of February of every year. The Operator shall keep
detailed records of all revenues and expenses as are necessary to reflect the results of the operation of
the Golf Course, including bills and invoices for supplies and services.
13. Revenue. All Revenues that the Operator receives from the management and operation
of the Golf Course shall accrue to the Operator..
14. Payment. All operating losses are the responsibility of the Operator except as
specifically provided herein, the City will not compensate the Operator for any expenses the Operator
incurs.
15. Concessions... The Operator shall provide the following concessions during the
operating season:
a. Golf balls, t-shirts, golf polos, sweatshirts and hats.
b. Soda, candy, chips and packed sandwiches and other products.
16. Advertising. The Operator-shall provide the following advertising and promotion:
4
a. Star News for league formation and membership.
b. Manage the current Pinewood Golf Course Facebook page but may not delete any old
posts, photos or videos.
17. Utilities and Operating Expenses. The Operator shall at its own expense be responsible
for the following payments and obligations:
a. All utilities, including gas, electric, water, cable, television, internet and telephone
service (internet/telephone provided and payable to the City).
b. Burglar alarm and monitoring system.
C. Irrigation and pump maintenance and the payment of contract fees for same, including
winterization and annual fall blow out.
18. Fees. The Operator, in its sole discretion, may set the fees for use of the Golf Course.
The Operator, in its sole discretion, shall set the fees for tournament play.
19. Log. The Operator shall create and maintain a general maintenance log of all equipment
listed in Exhibit A, attached hereto and made a part hereof. The City may request a copy of this log.
20. Repairs and Replacement. The Operator shall be financially responsible for all
equipment maintenance and repairs. If the Operator decides to use the City for any repairs or
maintenance, they will be charged and invoiced for such services. This is for City equipment listed in
Exhibit A and for any future purchases or replacement Capital improvements and equipment
replacement will be agreed upon by the City and the Operator and shall be the responsibility of the
City. The Operator shall, however, be responsible for any repairs or replacements due to any
negligence or willful misconduct.
21. Controlling LawNenue. This Agreement shall be governed by and construed in
accordance with the laws of the State of Minnesota. In the event of litigation, the exclusive venue shall
be in the District Court of the State of Minnesota for Sherburne County Minnesota.
22. Minnesota Government Data Practices Act. Operator must comply with the Minnesota
Government Data Practices Act, Minnesota Statutes Chapter 13, as it applies to (1) all data provided by
the City pursuant to this Agreement, and (2) all data, created, collected, received, stored, used,
maintained, or disseminated by Operator pursuant to this Agreement. Operator is subject to all the
provisions of the Minnesota Government Data Practices Act, including but not limited to the civil
remedies of Minnesota Statutes Section 13.08, as if it were a government entity. In the event Operator
receives a request to release data, Operator must immediately notify City. City will give Operator
instructions concerning the release of the data to the requesting party before the data is released.
Operator agrees to defend, indemnify, and hold City, its officials, officers, agents, employees, and
volunteers harmless from any claims resulting from Operator's officers', agents', city's, partners',
employees', volunteers', assignees' or subcontractors' unlawful disclosure and/or use of protected
data. The terms of this paragraph shall survive the cancellation or termination of this Agreement.
5
23. Assignment. The Operator shall not assign this agreement, or its rights, title or interest
herein without the express prior written consent of the City.
24. Termination. The City shall have the right to terminate this agreement if:
a. Operator is adjudged bankrupt or makes an assignment for the benefit of creditors; or
b. A receiver or liquidator is appointed for Operator or for any of its property and is not
dismissed within twenty (20) days after such appointment or the proceeding in
connection therewith are not stayed on appeal within twenty (20) days; or Operator is
guilty of a substantial violation of any provision in this contract.
[Remainder of Page Intentionally Left Blank.]
CITY OF ELK RIVER
By:
John J. Dietz, Mayor
By:
Tina Allard, City Clerk
STATE OF MINNESOTA )
)ss.
COUNTY OF SHERBURNE )
The foregoing instrument was acknowledged before me this day of
2019 by John J. Dietz and Tina Allard, respectively the Mayor and City Clerk of the City of Elle River, a
Minnesota municipal corporation, on behalf of the corporation and pursuant to the authority granted by
its City Council.
Notary Public
ELK RIVER COUNTRY CLUB, INC.
d/b/a Elk River Golf Club
By:
Name:
Title:
6
STATE OF MINNESOTA )
)ss.
COUNTY OF SHERBURNE )
The foregoing instrument was acknowledged before me this day of
2019 by , the of Elle River Country Club, Inc., a
Minnesota corporation, on behalf of the corporation.
Notary Public
7
Exhibit A
Equipment provided by City
Unit Make Model Hours Serial Number 2019
Number Estimated
Value
784P Toro Groundsmaster 3500-D 2526 308-260000452 $31,385
782P Toro Reelmaster 5200-D no-meter 03540- $35,200
260000253
783P Toro Greensmaster 3150-Q 1470 0357- $27,765
260000691
786P Toro Greensmaster 3150-Q 305 04358- $27,765
313000251
781P Toro Workman 247 07277- $9,975
260000717
785P Cushman Turf-Truckster 60 99006290 $13,000
Toro Greens Aerator no meter 09120-60403 $4,000
Lely Fertilizer Spreader no meter 2.32021E+13 $3,000
Club Car Utility Cart no meter No number $12,000
present
EZGO TXT Golf Cart no meter 2288571 $3,540
EZGO TXT Golf Cart no meter 2288547 $3,540
EZGO TXT Golf Cart no meter 2289143 $3,540
EZGO TXT Golf Cart no meter 2289178 $3,540
EZGO TXT Golf Cart no meter 2289146 $3,540
EZGO TXT Golf Cart no meter 2289893 $3,540
EZGO TXT Golf Cart no meter 2289174 $3,540
EZGO TXT Golf Cart no meter 2288522 $3,540
EZGO TXT Golf Cart no meter 2289553 $3,540
EZGO TXT Golf Cart no meter 2289131 $3,540
EZGO TXT Golf Cart no meter 2289130 $3,540
8
Exhibit B
Maintenance Standards
Maintenance
• Maintenance Equipment
o Operator may use the current equipment allocated at Pinewood by the City to up keep
the course to the standard listed below. Any additional equipment that is needed in the
joint determination of the City and Operator shall be provided by City
• Greens
o Mowed daily to keep constant speed and conditions.
o Topdressing and fertilizing will be scheduled by Jon Varty, depending upon the turf
condition starting the year coming out of the winter.
o Topdressing
• Aerification will take place in the late fall and be top dressed in the spring—Fairways, Rough,
Edging, and Tees
o Mowed 3 to 4 times a week.
o Fertilizing will be scheduled based on weather and turf conditions.
o Use of IPM (ingrate pest management). Pesticide and fertilizer may only be used by a
certified pesticide licensed company when needed, not a static plan.
• Weed control of all the grounds.
• Irrigation will be maintained with same parts as presently used, and blown out each fall during
late October.
• Equipment repairs and-maintenance will be performed by Operator.
• The parties understand that there may be additional capital improvements required to make the
facility fit for public use. Any capital improvements required will be paid by the City.
Operator can assist in bidding it out to make sure to keep cost down.
Clubhouse
• Clubhouse must be maintained in proper condition in accordance with the state health and
safety guidelines.
• Each day the closing worker will have a checklist to complete and make sure that the clubhouse
area is set for the next day.
o Wipe down all tables.
o Empty all garbage receptacles.
o Turn off coffee warmer and coffee machine.
o Clean coffee machine and coffee pots.
9
o Put hot dog condiments (onions, relish, etc.) in cooler.
o Fill pop cooler.
o Empty popcorn machine and clean out.
o Stock bar (napkins, straws, swords, chips, cups, lids, etc.)
o Take roller off on hot dog machine, wash it, and wash inside.
o Dishes are done and put away.
o Make sure all lights are turned off, upstairs and down.
o Make sure windows are shut.
o Make sure all doors are locked.
o Check patio for garbage and make sure patio is arranged for next day.
o Vacuum.
o Count cash box in office and deposit in safe.
o Close out credit card machine.
10