4.3. SR 02-18-2020
Request for Action
To Item Number
Mayor and City Council 4.3
Agenda Section Meeting Date Prepared by
Consent February 18, 2020 Brandon Wisner, Stormwater Coordinator
Item Description Reviewed by
Certification – Minnesota Department of Natural Peter Beck, City Attorney
Resources General Obligation Bond Financed
Reviewed by
Property for the Lake Orono Restoration and
Cal Portner, City Administrator
Enhancement Project
Action Requested
Approve, by motion, the Certification between the Minnesota Department of Natural Resources and the City
of Elk River for General Obligation Bond Financed Property for the Lake Orono Restoration and
Enhancement Project
Background/Discussion
The grant between the Minnesota Department of Natural Resources, Minnesota Management and Budget
(MMB) and the City of Elk River was executed on August 23, 2019. The office of MMB requires the attached
certification. This is the final procedural step for the $1.5 million dollar grant that was approved by the state
legislature in bill HF 80.
Financial Impact
N/A
Attachments
Certification – General Obligation Bond Financed Property
State of Minnesota General Obligation Bond Grant Contract with the City of Elk River for
Reclamation and Enhancement of Lake Orono 9/23/2019
The Elk River Vision
A welcoming community with revolutionary and spirited resourcefulness, exceptional
service, and community engagement that encourages and inspires prosperity
CERTIFICATION
State of Minnesota
General Obligation Bond Financed Property
The undersigned has a fee simple, leasehold and/or easement interest in the real property
located in the County of Sherburne, State of Minnesota that is generally described or illustrated
graphically in Exhibit A attached and all facilities situated thereon (the “Restricted Property”)
and acknowledges that the Restricted Property is or may become State bond-financed property.
To the extent that the Restricted Property is or becomes State bond-financed property, the
undersigned acknowledges that:
A. The Restricted Property is state bond financed property within the meaning of
Minn. Stat. Sec. 16A.695, is subject to the encumbrance created and
requirements imposed by such statute, and cannot be sold, mortgaged,
encumbered or otherwise disposed of without the approval of the
Commissioner of Minnesota Management and Budget;
B. The Restricted Property is subject to the provisions of the State of Minnesota
General Obligation Bond Grant Contract with the City of Elk River for
Reclamation and Enhancement of Lake Orono (158848 / 3000151955)
between the Minnesota Department of Natural Resources and the City of Elk
River, dated ________________, 20___; and
C. The Restricted Property shall continue to be deemed state bond financed
property for 125% of the useful life of the Restricted Property or until the
Restricted Property is sold with the written approval of the Commissioner of
Minnesota Management and Budget.
Date: __________________, 20____
_____________________________________
City of Elk River, a political subdivision of the
State of Minnesota
By: ________________________________
Name: John J. Dietz
Title: Mayor, City of Elk River
By: ________________________________
Name: Tina Allard
Title: City Clerk, City of Elk River
Exhibit A
GENERAL DESCRIPTION OF RESTRICTED PROPERTY
158848/3000151955
STATE OF MINNESOTA GENERAL OBLIGATION BOND GRANT CONTRACT
WITH THE CITY OF ELK RIVER FOR RECLAMATION AND ENHANCEMENT OF LAKE ORONO
This grant contract is between the State of Minnesota, acting through its Commissioner of Natural Resources,
("State") and the City of Elk River, 13065 Orono Parkway, Elk River, Minnesota, 55330 ("Grantee").
Recitals
1. Under Minnesota. Statutes, Section 84.026, Subdivision 2, the State is empowered to enter into this grant
contract with the Grantee for a natural resources improvement project.
2. Minnesota Session Laws 2019, Chapter 2, Article 1, Section 2, subdivision 3 appropriates funds for a grant to
the Grantee for reclamation of Lake Orono.
3. The State agrees that reclamation and enhancement of Lake Orono is in the interest of the State.
4. The Grantee represents that it is duly qualified and agrees to perform all services described in this grant
contract to the satisfaction of the State. Pursuant to Minnesota Statutes § 16B.98 Subdivision 1, the Grantee
agrees to minimize administrative costs as a condition of this grant contract
5. The Grantee attests it has the financial capacity to provide any required local match for the project or phase
funded under the terms of this grant contract, and agrees to complete the project or phase if the cost of the
project or phase exceeds the amount of state funding and required local match.
6. The monies allocated to fund the grant to the Grantee are proceeds of state general obligation (G.O.) bonds
authorized to be issued under Article XI, § 5(a) of the Minnesota Constitution; and
7. The Grantee's receipt and use of the G.O. Grant to acquire an ownership interest in and/or improve real
property (the "Real Property") and, if applicable, structures situated thereon (the "Facility") will cause the
Public Entity's ownership interest in all of such real property and structures to become "state bond financed
property", as such term is used in Minn. Stat. § 16A.695 (the "G.O. Compliance Legislation") and in that
certain "Fourth Order Amending Order of the Commissioner of Finance Relating to Use and Sale of State
Bond Financed Property" executed by the Commissioner of Minnesota Management and Budget and dated
July 30, 2012, as amended (the "Commissioner's Order"), even though such funds may only be a portion of the
funds being used to acquire such ownership interest and/or improve such real property and structures and that
such funds may be used to only acquire such ownership interest and/or improve a part of such real property and
structures.
Grant Contract
Term of Grant Contract
1.1 Effective date: June 15, 2019, or the date the State obtains all required signatures under Minnesota
Statutes §16C.05, subdivision 2, whichever is later. Per Minn. Stat.\1166B.98 Subd. 7, no payments will be
made to the Grantee until this grant contract is fully executed. The Grantee must not begin work under
this grant contract until this contract is fully executed and the Grantee has been notified by the
State's Authorized Representative to begin the work.
1.2 Expiration date: June 30, 2021, or until all obligations have been satisfactorily fulfilled, whichever occurs
first.
1.3 Survival of Terms. The following clauses survive the expiration or cancellation of this grant contract:
8. Liability; 9. State Audits; 10. Government Data Practices and Intellectual Property; 13. Publicity and
Endorsement; 14. Governing Law, Jurisdiction, and Venue; and 16. Data Disclosure.
2 Grantee's Duties
The Grantee, who is not a state employee, will be responsible for:
Engineering, design, and construction of a reclamation and enhancement project at Lake Orono, including
the removal of as much sediment from the upper basin to an average depth of five feet as funding allows to
improve navigation, recreation, and wildlife habitat.
Grant (Rev 08/18)
158848 / 3000151955
All project expenses not identified as being related to work outlined above, or as subsequently amended in this
agreement, must be approved by the State in writing prior to the Grantee incurring said expense.
3 Time
The Grantee must comply with all the time requirements described in this grant contract. In the performance
of this grant contract, time is of the essence.
Consideration and Payment
4.1 Consideration. The State will reimburse for all eligible services performed by the Grantee under this grant
contract as follows:
(a) Compensation. The Grantee will be reimbursed 100% for eligible bondable project expenses, not to
exceed $1,500,000.00. This award does not require a local match from Grantee.
(b) Travel Expenses. Reimbursement for eligible project -related travel and subsistence expenses actually
and necessarily incurred by the Grantee as a result of this grant contract will be reimbursed in the same
manner and in no greater amount than provided in the current "Commissioner's Plan" promulgated by
the Commissioner of Minnesota Management and Budget (MMB). The Grantee will not be
reimbursed for travel and subsistence expenses incurred outside Minnesota unless it has received the
State's prior written approval for out of state travel. Minnesota will be considered the home state for
determining whether travel is out of state.
(c) Eligible Expenses. Eligible expenses are those costs directly incurred by the Grantee that are solely
related to and necessary for producing the work products described in Provision 2 of this Agreement.
Eligible costs may include the following:
advertising costs for bids and proposals; capital expenditures for facilities, equipment and other capital
assets as expressly approved by the State; materials and supplies; architectural and engineering services;
construction management and inspection services; surveys and soil borings; attorney fees solely related and
necessary to accomplish the Project, as determined by the State and actual construction of the Project.
Certain other types of costs may be eligible provided that they are (1) directly incurred by the Grantee; (2)
are solely related to, and necessary for, producing the workproducts described in Provision 2; and (3) have
prior written approval of the State. Any cost not defined as an eligible cost or not included in the Project
Plan shall not be paid from State funds committed to the Project,
(d) Ineligible Expenses. Non -eligible costs for reimbursement means all costs not defined as eligible
costs, including but not limited to the following:
Any costs incurred before the effective date of this Grant; fund raising; taxes, except sales tax on goods
and services; insurance, except title insurance; attorney fees not necessaryto accomplish the project; loans,
grants, or subsidies to persons or entities for development; financing; bad debts or contingency funds;
interest; operation and maintenance costs; options for acquisition of real estate; lobbyists; and political
contributions.
4.2. Payment
Invoices. To obtain reimbursement for eligible costs under this Grant, the Grantee shall provide the State
with invoices and evidence that the portion of the Project for which payment is requested has been
satisfactorily completed. All invoices shall be sent to the person designated in Section 6. Grantee shall
submit invoices and evidence that the required contribution toward any required local match are being met.
Invoices will be submitted for the amount and should differentiate, when applicable, between the Federal
and Non -Federal Project costs, as well as the State and local share of the Project costs. Invoices must be
received by the State within thirty (30) days after the completion of the Project or the expiration of this
Grant as set forth in Section 1.2, whichever occurs first. Invoices received after that date may not be
eligible for reimbursement, at the State's discretion. The State's authorized agent has final authority for
acceptance of Grantee's services, determination as to whether the expenditures are eligible for
Grant (Rev 08/18)
158848 / 3000151955
reimbursement under this Grant, and verification of the total amount requested. The Grantee shall not
receive payment for work found by the State to be unsatisfactory, or performed in violation of federal, state
or local law, ordinance, rule or regulation. At its discretion, the State may retain 10% of the total grant
award until the State has determined that the Grantee has satisfactorily fulfilled all of the terms of this
Grant. If requested by the State, the Grantee shall arrange for a tour of the Project area prior to release of
the final ten (10) percent of the funds. Invoices must be submitted timely and according to the following
schedule:
It is required that invoices be submitted, at a minimum, at the close of each state fiscal yearwhich is July 1
— June 30. If expenses are extensive, reimbursement requests may be submitted monthly or quarterly.
Please itemize the eligible expenses by the month of occurrence, not liquidation. if invoices are not
received in this format, it could delay receipt of payment.
5 Conditions of Payment
All services provided by the Grantee under this grant contract must be performed to the State's satisfaction, as
determined at the sole discretion of the State's Authorized Representative and in accordance with all applicable
federal, state, and local laws, ordinances, rules, and regulations. The Grantee will not receive payment for work
found by the State to be unsatisfactory or performed in violation of federal, state, or local law.
Authorized Representative
The State's Authorized Representative is Patrick Lynch, Floodplain Hydrologist, Department of Natural Resources,
500 Lafayette Road, St. Paul, Minnesota, 55155, 651-259-5691, pat_ ,• nch ,� state.111n.us , or his/her successor, and
has the responsibility to monitor the Grantee's performance and the authority to accept or reject the services
provided under this grant contract. If the services are satisfactory, the State's Authorized Representative will certify
acceptance on each invoice submitted for payment.
The Grantee's Authorized Representative is Brandon Wisner, Stormwater Coordinator, City of Elk River, 13065
Orono Parkway, Elk River, Minnesota 55330, 763-635-1000, hwisner a ell criverrnn.�ay .If the Grantee's
Authorized Representative changes at any time during this grant contract, the Grantee must immediately notify the
State.
7 Assignment, Amendments, Waiver, and Grant Contract Complete
7.1 Assignment The Grantee shall neither assign nor transfer any rights or obligations under this grant
contract without the prior written consent of the State, approved by the same parties who executed and
approved this grant contract, or their successors in office.
7.2 Amendments. Any amendments to this grant contract must be in writing and will not be effective until it
has been executed and approved by the same parties who executed and approved the original grant
contract, or their successors in office.
7.3 Waiver. If the State fails to enforce any provision of this grant contract, that failure does not waive the
provision or the State's right to enforce it.
7.4 Grant Contract Complete. This grant contract contains all negotiations and agreements between the State
and the Grantee. No other understanding regarding this grant contract, whether written or oral, may be
used to bind either party.
8 Liability
The Grantee must indemnify, save, and hold the State, its agents, and employees harmless from any claims or
causes of action, including attorney's fees incurred by the State, arising from the performance of this grant contract
by the Grantee or the Grantee's agents or employees. This clause will not be construed to bar any legal remedies
the Grantee may have for the State's failure to fulfill its obligations under this grant contract.
158848 / 3000151955
State Audits
Under Minn. Stat. § 1613.98, Subd.8, the Grantee's books, records, documents, and accounting procedures and
practices of the Grantee or other party relevant to this grant agreement or transaction are subject to examination by
the State and/or the State Auditor or Legislative Auditor, as appropriate, for a minimum of six years from the end
of this grant agreement, receipt and approval of all final reports, or the required period of time to satisfy all state
and program retention requirements, whichever is later.
10 Government Data Practices
The Grantee and State must comply with the Minnesota Government Data Practices Act, Minn. Stat. Ch. 13, as it
applies to all data provided by the State under this grant contract, and as it applies to all data created, collected,
received, stored, used, maintained, or disseminated by the Grantee under this grant contract. The civil remedies of
Minn. Stat. § 13.08 apply to the release of the data referred to in this clause by either the Grantee or the State.
If the Grantee receives a request to release the data referred to in this Clause, the Grantee must immediately notify
the State. The State will give the Grantee instructions concerning the release of the data to the requesting party
before the data is released. The Grantee's response to the request shall comply with applicable law.
11 Prevailing Wages
Grantee agrees to comply with all of the applicable provisions contained in Chapter 177 ofthe Minnesota Statutes,
and specifically those provisions contained in Minn. Stat. §§ 177,41 through 177,435, as they may be amended,
modified or replaced from time to time with respect to the Project.
12 Workers' Compensation
The Grantee certifies that it is in compliance with Minn. Stat. § 176.181, subd. 2, pertaining to workers'
compensation insurance coverage. The Grantee's employees and agents will not be considered State employees.
Any claims that may arise under the Minnesota Workers' Compensation Act on behalf of these employees and any
claims made by any third party as a consequence of any act or omission on the part of these employees are in no
way the State's obligation or responsibility.
13 Publicity and Endorsement
13.1 Acknowledgments. The Grantee agrees to acknowledge the State's financial support for the Project. Any
statement, press release, bid, solicitation, or other document issued describing the Project shall provide
information reflecting that State funds were used to support the Project and will contain the following
language:
This Project is made possible in part by a grant provided by the Minnesota Department of Natural
Resources, through an appropriation by the Minnesota State Legislature.
Any site developed or improved by the Project shall display a sign, in a form approved by the State,
stating the same information.
13.2 Endorsement. The Grantee must not claim that the State endorses its products or services.
14 Governing Law, Jurisdiction, and Venue
Minnesota law, without regard to its choice -of -law provisions, governs this grant contract. Venue for all legal
proceedings out of this grant contract, or its breach, must be in the appropriate state or federal court with competent
jurisdiction in Ramsey County, Minnesota.
158848 / 3000151955
15 Termination
15.1 Termination by the State. The State may immediately terminate this grant contract with or without cause,
upon 30 days' written notice to the Grantee. Upon termination, the Grantee will be entitled to payment,
determined on a pro rata basis, for services satisfactorily performed.
15.2 Termination for Cause. The State may immediately terminate this grant contract if the State finds that
there has been a failure to comply with the provisions of this grant contract, that reasonable progress has
not been made or that the purposes for which the funds were granted have not been or will not be
fulfilled. The State may take action to protect the interests of the State of Minnesota, including the
refusal to disburse additional funds and requiring the return of all or part of the funds already disbursed.
16 Data Disclosure
Under Minn. Stat. § 270C.65, Subd. 3, and other applicable law, the Grantee consents to disclosure of its social
security number, federal employer tax identification number, and/or Minnesota tax identification number, already
provided to the State, to federal and state tax agencies and state personnel involved in the payment of state
obligations. These identification numbers may be used in the enforcement of federal and state tax laws which
could result in action requiring the Grantee to file state tax returns and pay delinquent state tax liabilities, if any.
17 Preservation of Tax Exempt Status
In order to preserve the tax-exempt status of the G.O. Bonds, the Grantee agrees as follows:
A. It will not use the Real Property or, if applicable, Facility, or use or invest the G.O. Grant or any
other sums treated as "bond proceeds" under Section 148 of the Code including "investment proceeds," "invested
sinking funds," and "replacement proceeds," in such a manner as to cause the G.O. Bonds to be classified as
"arbitrage bonds" under Section 148 of the Code.
B. It will, upon written request, provide the Commissioner of MMB all information required to satisfy
the informational requirements set forth in the Code including, but not limited to, Sections 103 and 148 thereof,
with respect to the G.O. Bonds.
C. It will, upon the occurrence of any act or omission by the Grantee or any Counterparty that could
cause the interest on the G.O. Bonds to no longer be tax exempt and upon direction from the Commissioner of
MMB, take such actions and furnish such documents as the Commissioner of MMB determines to be necessary
to ensure that the interest to be paid on the G.O. Bonds is exempt from federal taxation, which such action may
include either: (i) compliance with proceedings intended to classify the G.O. Bonds as a "qualified bond" within
the meaning of Section 141(e) of the Code, (ii) changing the nature or terms of the Use Contract so that it
complies with Revenue Procedure 97-13, 1997-1 CB 632, or (iii) changing the nature of the use of the Real
Property or, if applicable, Facility so that none of the net proceeds of the G.O. Bonds will be used, directly or
indirectly, in an "unrelated trade or business" or for any "private business use" (within the meaning of Sections
141(b) and 145(a) of the Code), or (iv) compliance with other Code provisions, regulations, or revenue
procedures which amend or supersede the foregoing.
D. It will not otherwise use any of the G.O. Grant, including earnings thereon, if any, or take or permit
to or cause to be taken any action that would adversely affect the exemption from federal income taxation of the
interest on the G.O. Bonds, nor omit to take any action necessary to maintain such tax exempt status, and if it
should take, permit, omit to take, or cause to be taken, as appropriate, any such action, it shall take all lawful
actions necessary to rescind or correct such actions or omissions promptly upon having knowledge thereof.
18 Use of State Bond- Financed Property, Deed Restrictions, and Real Estate Declarations
"Stale bond- financed property" means property acquired or bettered in whole or in part with the proceeds of state
general obligation bonds authorized to be issued under article Xl, section 5, clause (a), of the Minnesota
158848 / 3000151955
Constitution. Use of State bond- financed property must be operated in compliance with the provisions of
Minnesota Statutes chapter 16A.695, all state and federal laws, and in a manner that will not cause the interest on
the state general obligation bonds to be or become subject to federal income taxation for any reason.
Upon acquisition or bettsrmen# of any land and/or structures using these grant funds, Grantee shall record
permanent deed restrictions requiring any new or future public improvements on the parcels to be in strict
conformance with adopted floodplain and shoreland standards.
Grantee shall record a declaration for real estate rights acquired or property bettered under this
Agreement. The declaration must acknowledge the property rights or betterments were acquired in whole
or in part with State general obligation bond funds and subject to the encumbrance created and
requirements imposed by Minnesota Stat. Sec. 16A. Grantee shall submit a copy of the recorded real estate
declaration for real estate acquired or bettered under this Grant to the State's Authorized Agent using the
form in Attachment A of this Grant or on an alternative form pre- approved by the State.
Proof of recordation of the deed restrictions and declaration for each property acquired or bettered under
the terms of this Agreement must be submitted to the State's authorized agent within 60 days of acquisition
or betterment, and before final payment is made by the State to the Grantee.
19 Invasive Species
The DNR requires active steps to prevent or limit the introduction, establishment, and spread of invasive species
during contracted work. The contractor shall take measures to prevent invasive species from entering into or
spreading within a project site by cleaning equipment prior to arriving at the project site. If the equipment,
vehicles, gear, or clothing arrives at the project site with soil, aggregate material, mulch, vegetation (including
seeds) or animals, it shall be cleaned by contractor furnished tool or equipment (brushibroom, compressed air or
pressure washer) at the staging area. The contractor shall dispose of material cleaned from equipment and clothing
at a location determined by the DNR Contract Administrator. If the material cannot be disposed of onsite, secure
material prior to transport (sealed container, covered truck, or wrap with tarp) and legally dispose of offsite.
20 Jobs Reporting
Pursuant to Minnesota Statutes 16A.633, subd. 4, the Grantee shall collect, maintain and, upon completion of
the project, provide the information to the State on forms provided by the State. The information must include
the number and types of jobs created by the project, whether the jobs are new or retained, where the jobs are
located, and pay ranges of the jobs.
21 E-Verification
The Grantee agrees and acknowledges that it is aware of Minn. Stat. § 16C.075 regarding e-verification of
employment of all newly hired employees to confirm that such employees are legally entitled to work in the
United States, and that it will, if and when applicable, fully comply with such statute.
22 Construction Contract Language on Jobs Reporting
The Contractor is hereby advised that this Project is funded all or in part by state bond funds and subject to the
reporting requirements of Minnesota Statute 16A.633, Subdivision 4 (MN Laws of 2012 Chapter 293, Section
28).
23 Permits, Approvals and Environmental Review
This grant does not constitute State approval of the project or phase funded under this agreement, and neither
negates nor precludes any mandatory environmental review or permitting requirements that may apply to the
project or phase. Grantee may not commence construction until all necessary permits and approvals have been
obtained and the requirements of Minnesota Rules, Chapter 4410 have been satisfied.
1. STATE ENCUMBRANCE VERIFICATION
Individual certifies drat funds have been encumbered as
required by Minn_Star §§I6A IS and 16C 05
Signed: 4 &A.,
Date: 6/4/2019
SWIFT Contract/P0 No(s),_ 15948/000151.955
2. GRANTEE
The Grantee certifies that the appropriate person(s)
have executed the gtanLipntraet on behalf of the Grantee as
required by applimsblsy atfkr , bylaws, resolutions, or ordinances
By: �421 1 —
Title: L: may`jl
Date: 8/19/2019
9
Title: City Clerk
Date: 8/19/2019
7
158848 / 3000151955
3. STATE AGENCY
Individual certifies the applicable provisions of Minn. Stat.
§16C.08. suhrltvi, uu 2 ar 3 are rearmed.
By
(with deQw :rlharityj Steve Calvin
Title Director, Ecol ticul & Water Re&ources
Date: V vl ' 9
Distribution:
Agency
Grantee
State's Authorized Representative - Photo Copy