American Tank and Fabrication Development AgreementTHE CITY OF DUBUQUE
Masterpiece on the Mississippi
Dubuque
All-American City
2007
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Development Agreement with American Tank and Fabrication
DATE: August 28, 2008
Based on a request from Mark Klausner, General Manager of American Tank and
Fabrication, Economic Development Director Dave Heiar is recommending that a new
Development Agreement be approved.
The original Vessel Systems Development Agreement was approved in 2003. The
company was owned by Mark Klausner and Ken Heitreitter, and committed to the
retention of 24 jobs and the creation of 25 new positions. In 2005, when the company
was heading toward bankruptcy, the City approved an amendment to the development
agreement to allow the sale of the business to Art's Way Manufacturing. Klausner and
Heitreitter retained ownership of the land and building and leased the property to Art's
Way. The partnership of Klausner/Heitreitter was known as Marke, LLC.
After approximately one year, Art's Way -Vessel System decided not to renew the
lease. Art's Way negotiated a separate development agreement with the City of
Dubuque to acquire five acres of property in the DICW. Art's Way-Vessel agreed to
retain 25 positions and create 10 new positions in return for TIF rebates and a land
discount.
During this same time, Klausner purchased Heitreitter's interest in Marke, LLC, and
formed a new company known as American Tank and Fabrication. The new company
manufactures the same product line as Art's Way-Vessel.
Based on the "split" of the company, Klausner has requested that the City amend the
development agreement to acknowledge that some of the employees and product line
would be part of the Art's Way-Vessel's project.
Based on the circumstances and the unique situation created by the development of a
new, competing business, Dave Heiar recommends that the City approve the attached
development agreement which would reduce the job creation from 25 positions to 10
positions. The agreement would still require the retention of 24 employees. The
proposed development agreement would also modify the pay back provision for jobs not
created from $3,908 to $5,632 per job. Dave Heiar also recommends that the City
release Kenneth Heitreitter from his personal guaranty, and approve the updated
personal guaranty of Mark Klausner.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Michael C. Van Milligen
MCVM/jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
David J. Heiar, Economic Development Director
THE CITY OF DUBUQUE
Masterpiece on the Mississippi
Dubuque
All-American City
2007
August 26, 2008
TO: Michael C. Van Milligen, City Manger
FROM: David J. Heiar, Economic Development Director
RE: Development Agreement with American Tank and Fabrication
INTRODUCTION
Due to the many organizational changes associated with American Tank and
Fabrication, Mark Klausner, the company's general manager, has requested an
amendment to the original development agreement. City Attorney, Lindahl, has
recommended that a new development agreement be prepared to replace the original
agreement and amendments to simplify and clarify the terms of the agreement.
BACKGROUND
The original Vessel Systems Development Agreement was approved in 2003. The
company was owned by Mark Klausner and Ken Heitreitter, and committed to the
retention of 24 jobs and the creation of 25 new positions. In 2005, when the company
was heading toward bankruptcy, the City approved an amendment to the development
agreement to allow the sale of the business to Art's Way Manufacturing. Klausner and
Heitreitter retained ownership of the land and building and leased the property to Art's
Way. The partnership of Klausner/Heitritter was known as Marke, LLC.
After approximately one year, Art's Way -Vessel System decided not to renew the
lease. Art's Way negotiated a separate development agreement with the City of
Dubuque to acquire five acres of property in the DICW. Art's Way-Vessel agreed to
retain 25 positions and create 10 new positions in return for TIF rebates and a land
discount.
During this same time, Klausner purchased Heitreitter's interest in Marke, LLC, and
formed a new company known as American Tank and Fabrication. The new company
manufactures the same product line as Art's Way-Vessel.
DISCUSSION
Based on the "split" of the company, Klausner has requested that the City amend the
development agreement to acknowledge that some of the employees and product line
would be part of the Art's Way-Vessel's project. Attached is a January 8, 2008 letter
providing Mr. Klausner's rationale for this request. He also asks that the City release Mr.
Heitreitter from the personal guaranty that was required at the time the Council
amended the development agreement to allow for the sale of the business. Mr.
Klausner has provided an updated personal guaranty to secure any default in the
proposed development agreement.
In addition, Mr. Klausner requested that the City rebate a portion of the property tax
increment not needed to repay the TIF bond indebtedness that was an original part of
the first development agreement. When the City enters into a development agreement,
the business is always given the opportunity to choose between an upfront TIF Bond or
a TIF rebate. Vessel Systems chose a TIF Bond which the City is currently repaying. If
the City were to now allow the company to change or blend these options it would set
precedence for any other projects where a TIF bond was used as an incentive for
development. Therefore, this request was not included in this development agreement.
RECOMMENDATION/ACTION STEP
Based on the circumstances and the unique situation created by the development of a
new, competing business, I recommend that the City approve the attached development
agreement which would reduce the job creation from 25 positions to 10 positions. The
agreement would still require the retention of 24 employees. The proposed
development agreement would also modify the pay back provision for jobs not created
from $3,908 to $5,632 per job. I also recommend that the City release Kenneth
Heitreitter from his personal guaranty, and approve the updated personal guaranty of
Mark Klausner.
F:\USERS\DHeiarWmerican TankWmerican Tank DA Council Memo.doc
AMERICAN
TANK FABRICATION
www.AmericanTankFab.com 8025 Chavenelle Rd
Dubuque, IA. 52002 USA
January 8, 2008
Mr. Dave Heiar
Economic Development Director
50 West 13th Street
Dubuque, IA 52001-4864
Dear Dave,
Thank you for our meeting Friday, December 28. It was time well spent. To bring
everyone up to date, I would like to tell of our progress. Our new Company, American
Tank and Fabrication, took possession of the building on October 5, and immediately
began to rebuild from the damage that was incurred from Art's Ways exit. I will not
hesitate to say that the damage was intentional, deliberate, and substantial. Be that as it
may, our progress far and away exceeds our plans and expectations. The plant was
essentially rebuilt, new equipment was moved in, inventory purchased, and employees
hired all within the business plan perimeters and budget. At this point in time, we have
24 employees and shipments began 4 weeks after taking possession. To say I'm proud of
our team, their efforts, and what they have overcome, would be an understatement. Our
employees' dedication and commitment is exemplary for all of Dubuque to witness.
The history is well documented and I would prefer to consider it just that -the past.
These employees have overcome a considerable amount of turmoil and I believe that it is
testimony to the character of all those who have decided to stay, help, and persevere.
Over $1,000,000 has been invested in capital equipment. It is our intention to be the
most modern tank manufacturing facility in the country. February '08 shipments appear
to be an all-time~record for this facility. We have garnered several world-class
companies that any company would consider it a lirivilege to do business with. Our
future looks very bright.
For me to personally undertake this endeavor, it was necessary for me to severe any and
all ties with my former partner, Ken Heitritter. I have signed agreements/contracts
stating that I take full and total responsibility for any and all debts in relation to this
business and building for certain transactions directly or indirectly affiliated with this
endeavor. That includes the TIF, Premier Bank mortgage, and Land Development
Agreement with the City of Dubuque. I am requesting that the City formally recognize
these agreements and release Heitritter from any and all obligations. I will stand in his
place and assume all the responsibilities contracts/agreements with the City that
accompany these obligations. My personal financial statement is attached for your
review.
American Tank and Fabrication Co.
563-556-5889 phone / 563-556-5870 fax
AMERICAN
TANK & FABRICATION
www.AmericanTankFab.com 8025 Chavenelle Rd
Dubuque, IA. 52002 USA
In 2003-04, when Heitritter and I put together the original plan to build the building in
the new Dubuque Industrial Park, it was believed that the move would provide for an
additiona125 employees. Coupled with the origina124, the total would therefore be 49 or
50 employees. Circumstances both within and not within our control prohibited the
company from realizing its employment goals and commitments as the former company,
Vessel Systems Inc., fell on hard times and was foreclosed upon in Oct of ' O5.
Recognizing the commitment that was made, I am endeavoring to resurrect the program
as American Tanlc Tnnd would aslc the City to reconsider this commitment and reduce the
obligation to the hiring goal of 10 people along with an extension to December of 2009.
The hiring of 10 people would be more realistic as an attainable goal and assist in
lightening the burden of the former obligation and would be more in line with some of
the newer transactions that have recently been approved by the City and added programs.
In addition, as part of the economic incentive program, Vessels Systems Co choose and
received $190,000 cash, versus 10 years of real estate tax abatement. In previous
discussions, a conversion to the remainder of the 10 year abatement would be a request
that; requires extra consideration. American Tank is not requesting any more funds, just a
revision or conversion to whatever would remain of the 10 year abatement offer, after the
balance of $190,000 is "netted out".
These are important issues to American Tank. It is our group that has fought through
some very difficult circumstances. We are not quitters. It is our goal and desire to make
the city of Dubuque proud of our record. We look forward to the future with much
enthusiasm and consider it a privilege to apart of this community.
To further understand and appreciate-our position, I am requesting that each and every
council member visit our facility. I would appreciate an opportunity to meet them
personally and would welcome their time to demonstrate our level of commitment.
Thank you again for your time and consideration to these matters and I look forward to
our next communication.
Sincerely,
Mark Klausner
cc: Dan McDonald
Aaron DeJong
American Tank and Fabrication Co.
563-556-5889 phone / 563-556-5870 fax
AMERICAN
TANK & FABRICATION
www.AmericanTankFab.com $025 Chavenelle Rd
Dubuque, IA. 52002 USA
Request Summary
• Remove Heitritter from obligations.
• Reduce new hiring employee requirement to 10.
• Convert TIF funds to real estate tax abatement for remainder of term.
• Meet and tour council members.
American Tank and Fabrication Co.
563-556-5889 phone / 563-556-5870 fax
PERSONAL GUARANTY
City of Dubuque, Iowa
GUARANTY given by the undersigned, Mark W. Klausner, to the CITY OF
DUBUQUE, IOWA ("City").
Whereas, the City and Marke, LLC (the "Developer") are parties to a
Development Agreement dated as of June 2, 2003, as amended by an Amendment to
Development Agreement dated as of September 28, 2005 (together, the "Development
Agreement"), pursuant to which the Developer agreed to construct certain Minimum
Improvements (as defined in the Development Agreement) in the City and to maintain
and create a certain number of jobs at the Developer's facilities; and
Whereas, the City provided certain financial assistance to the Developer in
connection with the foregoing project activities, as described in the Development
Agreement, including the making of an Acquisition Grant and an Economic
Development Grant (each as defined in the Development Agreement) to the Developer
as a means of assisting the project; and
WHEREAS, in consideration for the significant financial assistance provided by
the City under the Development Agreement, the Developer's principals, namely Mark W.
Klausner and Kenneth D. Heitritter, have heretofore delivered their personal guaranties
to the City, each dated as of September 28, 2005, for the purpose of guaranteeing one-
half of the Developer's obligations under the Development Agreement; and
WHEREAS, the undersigned Mark W. Klausner now has requested the City to
release Kenneth E. Heitritter from his guaranty in consideration for the tender of this
Personal Guaranty, which the City is willing to accept.
NOW THEREFORE, as an inducement to the City and in consideration of the
Acquisition Grant and Economic Development Grant made to the Developer under the
Development Agreement, and the release of Kenneth E. Heitritter from his Personal
Guaranty dated September 28, 2005, which is hereby acknowledged, the undersigned
Mark W. Klausner for himself, and for his respective legal representatives, guarantees
to the City, its successors and assigns, the payment of all obligations due and payable
by the Developer to the City as the result of an Event of Default under the Development
Agreement, and in case of default on the part of the Developer in the payment of any
such obligations, or in the payment of any claims made by the City against the
Developer as a result of an Event of Default under the Development Agreement, the
undersigned agrees to pay all such obligations and claims to the City, or its successors
and assigns under the Development Agreement, promptly upon written demand
therefore by the City. This guaranty shall apply to any indebtedness or liability of any
kind owing by the Developer to the City under the Development Agreement and shall be
valid and continuous without further notice to the undersigned.
Guarantor further agrees that if an Event of Default arises under the
Development Agreement, the City has the right to proceed against the undersigned
guarantor without proceeding against or exhausting any other remedies which it may
have under the Development Agreement or otherwise and without resorting to any other
security held by the City.
Guarantor expressly waives notice from the City of its acceptance and reliance
on this Personal Guaranty. The undersigned Guarantor agrees to pay all costs,
expenses and fees, including all reasonable attorneys fees, which may be incurred by
City in enforcing or attempting to enforce this Personal Guaranty following any default
on the part of the Guarantor hereunder, whether the same shall be enforced by suit or
otherwise.
This Personal Guaranty supersedes all prior agreements between the parties
with respect to the subject matter hereof, and shall be governed by and construed in
accordance with the laws of the State of Iowa.
IN WITNESS WHEREOF, the undersigned has executed this Personal Guaranty
on the 25 day of July, 2008.
Mark W. Klau ner
DCORNELL/ 582423.1 /MSWord\10422.000
RELEASE AND DISCHARGE OF PERSONAL GUARANTY
FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
the City of Dubuque, Iowa does hereby finally and fully release and discharge Kenneth
E. Heitritter from any further obligations under that certain Personal Guaranty dated on
or about , 20_, executed by Kenneth E. Heitritter as Guarantor
for Marke, LLC thereunder.
Dated and effective this Sc day of , 20_
CITY OF DUBUQUE, IOWA
By
Roy D. Buol, Mayor
Attest:
Jeanne F. Schneider, City Clerk
DEVELOPMENT AGREEMENT
BETWEEN
THE CITY OF DUBUQUE, IOWA,
AND
AMERICAN TANK 8~ FABRICATION, CO.
This Agreement, dated for reference purposes the day of ,
2008, between the City of Dubuque, Iowa, a municipality (City), established
pursuant to the Iowa Code and acting under authorization of Iowa Code Chapter
403, as amended (the Urban Renewal Act), and American Tank & Fabrication, Co.,
an Iowa business corporation with its principal place of business in Dubuque, Iowa
(Developer).
WITNESSETH:
WHEREAS, in furtherance of the objectives of the Urban Renewal Act, City
has undertaken an Urban Renewal project (the Project) to advance the
community's ongoing economic development efforts; and
WHEREAS, the Project is located within the Dubuque Industrial Center
Economic Development District (the Project Area); and
WHEREAS, as of the date of this Agreement there has been prepared and
approved by City an Urban Renewal Plan for the Project Area consisting of the
Urban Renewal Plan for the Dubuque Industrial Center Economic Development
District, approved by the City Council of City on May 2, 1988, and as subsequently
amended through and including the date hereof, as amended, attached hereto as
Exhibit A (the Urban Renewal Plan); and
WHEREAS, a copy of the Urban Renewal Plan, as constituted on the date of
this Agreement and in the form attached hereto, has been recorded among the land
records in the office of the Recorder of Dubuque County, Iowa; and
WHEREAS, Developer has acquired approximately 5 acres of land all of
which are usable, legally described as Lots 7 and 8 Dubuque Industrial Center
West 2"d Addition identified on Exhibit B, attached hereto, in the City of Dubuque,
Dubuque County, Iowa, together with all easements, tenements, hereditaments,
and appurtenances belonging thereto (the Property) so that Developer may use
and occupy with appurtenant uses which City has determined and represented to
Developer is in accordance with the uses specified in the Urban Renewal Plan and
in accordance with this Agreement; and
WHEREAS, the Property was purchased from City by a predecessor in title
to Developer and City and Developer agree that for all purposes herein, Developer
shall be considered to have purchased the Property from City;
081408ba1
WHEREAS, Developer has renovated a facility on the Property in the Project
Area; and
WHEREAS, City believes that the renovation of the Property pursuant to this
Agreement, and the fulfillment generally of this Agreement, are in the vital and best
interests of City and in accord with the public purposes and provisions of the
applicable federal, state and local laws and the requirements under which the
Project has been undertaken and is being assisted.
NOW THEREFORE, in consideration of the premises and the mutual
obligations of the parties hereto, each of them does hereby covenant and agree
with the other as follows:
SECTION 1. TERMINATION OF PREVIOUS DEVELOPMENT AGREEENT;
CLOSING.
1.1 Upon approval and execution of this Agreement by both parties, the
Development Agreement between the City of Dubuque, Iowa and Vessel Systems,
Inc., dated June 2, 2003, shall be terminated.
1.2 Conditions to Closing. The closing of the transaction contemplated by this
Agreement and all the obligations of Developer under this Agreement are subject to
fulfillment, on or before the Closing Date, of the following conditions:
(1) Developer and City shall be in material compliance with all the terms
and provisions of this Agreement.
(2) Developer shall have furnished City with evidence in a form as
required by Section 4.2 and satisfactory to City of Developer's full-time jobs
in Dubuque, Iowa, as of
(3) Receipt of an opinion of counsel to Developer in the form attached
hereto as Exhibit C.
(4) Developer, at its sole cost and expense, shall have delivered to City
an abstract of title to the Property continued through the date of this
Agreement reflecting merchantable title in Developer in conformity with this
Agreement and applicable state law. The abstract shall be delivered
together with full copies of any and all encumbrances and matters of record
applicable to the Property.
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(5) Developer shall have executed and delivered to City the Minimum
Assessment Agreement consented to be all mortgagees, lienholders, and
encumbrances.
1.3 Closin The closing shall take place on the Closing Date which shall be on
the day of 2008, or such other date as the parties may agree.
Consummation of the closing shall be deemed an agreement of the parties to this
Agreement that the conditions of closing have been satisfied or waived.
1.4 Developer's Obligations at Closing. At or prior to the Closing Date,
Developer shall deliver to City all documents as may be required by this
Agreement, all in a form satisfactory to City.
SECTION 2. DEVELOPMENT ACTIVITIES
2.1 Required Minimum Improvements. City acknowledges that a predecessor in
title to Developer has built an industrial manufacturing facility on the Property with
certain internal systems thereto, and with all interior improvements ("the Minimum
Improvements"); all as more particularly depicted and described on the plans and
specifications delivered to and approved by the City. The predecessor in title to
Developer constructed on the Property an industrial manufacturing facility of thirty-
one thousand (31,000) square feet of floor space along with necessary site work as
contemplated in this Agreement at a cost of not less than $1,000,000.
SECTION 3. CITY PARTICIPATION
3.1 Acquisition Grant to Developer. For and in consideration of the obligations
of the predecessor in title to Developer to construct the Minimum Improvements,
City agreed to make and did make an Acquisition Grant to the predecessor in title
to Developer in the amount of One Hundred Ninety One Thousand Four Hundred
Ninety Dollars ($191,490). The parties agreed that the Acquisition Grant would be
payable in the form of a credit favoring Developer at time of Closing with the effect
of directly offsetting a portion of the purchase price obligation of Developer. City
and Developer agree that for purposes of this Agreement, the Acquisition Grant
shall be deemed to have been made by City to Developer.
3.2 Economic Development Grant to Developer. For and in consideration of the
obligations of the predecessor in title to Developer to undertake the employment
commitments as provided herein, City agreed (subject to the conditions set forth in
this Section) to make and did make an Economic Development Grant to the
predecessor in title to Developer. The Economic Development was in the total
amount of One Hundred Forty Thousand Dollars ($140,000.00) and payable solely
and only from the proceeds of the sale of urban renewal tax increment revenue
bonds or notes by City as described in Section 3.3 hereof, and not from any other
source. City and Developer agree that for purposes of this Agreement, the
3
Economic Development Grant shall be deemed to have been made by City to
Developer.
3.3 Issuance of Notes. Developer acknowledges and agrees that City financed
all of its costs associated with Project (including the funding of the Economic
Development Grant to Developer) through the issuance of urban renewal tax
increment revenue bonds or notes to be issued by City under the provisions of
Section 403.9 of the Iowa Code, the Urban Renewal Act and this Section (such
obligation being referred to herein as Notes).
3.4 Use of Tax Increments. Developer recognizes that City intends to utilize the
tax increment revenues collected in respect of Minimum Improvements to pay debt
service including without limitations the principal and accrued interest on the Notes.
After the payment of required debt service, City shall be free to use all tax
increment revenues collected in respect of Minimum Improvements or other
properties within Project Area for any purpose for which the tax increment revenues
may lawfully be used pursuant to the provisions of the Urban Renewal Act, and City
shall have no obligation to Developer with respect to use thereof.
SECTION 4. COVENANTS OF DEVELOPER
4.1 Job Creation. Developer shall maintain its existing twenty-four (24)
employees in Dubuque, Iowa, and shall create or cause to be created not less than
ten (10) new full time equivalent (2080 hours per year) employees within three (3)
years from the date of this Agreement, and shall maintain those jobs for two (2)
years thereafter. In the event that the certificate provided to City under Section 4.2
hereof on January 1, 2016 discloses that Developer does not as of that date have
at least 34 employees as provided hereinabove, then Developer shall pay to City,
promptly upon written demand therefore, an amount equal to $ 5632.00 per job not
created or maintained ($191,490.00 divided by 34 jobs = $ 5632.00). All employees
shall be paid starting wages of not less than $10.41 per hour. The average wages
for the twenty-four employees retained and the ten new employees shall be not less
than $13.10 per hour. Developer shall provide City with a personal guarantee in a
form acceptable to City to secure the requirements of this Section 4.1. The
payments provided for herein shall be the City's sole remedy for the failure of
Developer to meet the job creation requirements of this subsection 4.1.
4.2 Certification. To assist City in monitoring the performance of Developer
hereunder, not later than January 10, 2011, and not later than January 10 of each
year thereafter during the Term of this Agreement, a duly authorized officer of
Developer shall certify to City in a form acceptable to City (a) the number of full time
jobs employed by Developer in Dubuque, Iowa, and (b) to the effect that such
officer has re-examined the terms and provisions of this Agreement and that at the
date of such certificate, and during the preceding twelve (12) months, Developer is
not or was not in default in the fulfillment of any of the terms and conditions of this
4
Agreement and that no Event of Default (or event which, with the lapse of time or
the giving of notice, or both, would become an Event of Default) is occurring or has
occurred as of the date of such certificate or during such period, or if the signer is
aware of any such default, event or Event of Default, said officer shall disclose in
such statement the nature thereof, its period of existence and what action, if any,
has been taken or is proposed to be taken with respect thereto.
4.3 Books and Records. During the term of this Agreement, Developer shall
keep at all times and make available to City upon reasonable request proper books
of record and account in which full, true and correct entries will be made of all
dealings and transactions of or in relation to the business and affairs of Developer
in accordance with generally accepted accounting principles consistently applied
throughout the period involved, and Developer shall provide reasonable protection
against loss or damage to such books of record and account.
4.4 Execution of Assessment Agreement. Developer shall agree to, and with
City shall execute an Assessment Agreement substantially in the form attached
hereto as Exhibit D (Assessment Agreement) pursuant to the provisions of Section
403.6(19) of the Code of Iowa specifying the Assessor's Minimum Actual Value for
Property and Minimum Improvements for calculation of real property taxes.
Specifically, Developer shall agree to a minimum actual value for Property and
Minimum Improvements that will result in a minimum actual value as of January 1,
2009 of not less than One Million Dollars ($1,000,000.00) (such minimum actual
value at the time applicable is herein referred to as the Assessor's Minimum Actual
Value). Nothing in the Assessment Agreement shall limit the discretion of the
Assessor to assign an actual value to Property in excess of such Assessor's
Minimum Actual Value nor prohibit Developer from seeking through the exercise of
legal or administrative remedies a reduction in such actual value for property tax
purposes; provided, however, that Developer shall not seek a reduction of such
actual value below Assessor's Minimum Actual Value in any year so long as
Assessment Agreement shall remain in effect. Assessment Agreement shall
remain in effect until July 1, 2016 (the Termination Date). Assessment Agreement
shall be certified by the Assessor for City as provided in Iowa Code Section
403.6(19) and shall be filed for record in the office of the County Recorder of
Dubuque County, and such filing shall constitute notice to any subsequent
encumbrancer or purchaser of Property (or part thereof), whether voluntary or
involuntary, and such Assessment Agreement shall be binding and enforceable in
its entirety against any such subsequent purchaser or encumbrancer.
4.5 Real Property Taxes. From and after the Closing Date, Developer shall pay
or cause to be paid, when due, all real property taxes and assessments payable
with respect to all and any parts of the Property unless Developer's obligations have
been assumed by Developer or another person pursuant to the provisions of this
Agreement.
4.6 No Exemptions. During the term of this Agreement, Developer agrees not to
apply for any other state or local property tax exemptions which are available with
respect to the Development Property or the Minimum Improvements located
thereon that may now be, or hereafter become, available under state law or city
ordinance during the term of this Agreement, including those that arise under Iowa
Code Chapters 404 and 427, as amended.
4.7 Insurance Requirements.
(1) Developer shall maintain, or cause to be maintained, at its cost and
expense (and from time to time at the request of City shall furnish proof of
insurance in the form of a certificate of insurance) insurance as follows:
(a) All risk property insurance against loss and/or damage to
Minimum Improvements under an insurance policy written in an
amount not less than the full insurable replacement value of
Minimum Improvements. The term "replacement value" shall
mean the actual replacement cost of the Minimum
Improvements (excluding foundation and excavation costs and
costs of underground flues, pipes, drains and other uninsurable
items) and equipment, and shall be reasonably determined
from time to time at the request of City, but not more frequently
than once every three (3) years.
(2) Developer shall notify City immediately in the case of damage
exceeding $500,000.00 in amount to, or destruction of, the Minimum
Improvements or any portion thereof resulting from fire or other casualty. Net
proceeds of any such insurance (Net Proceeds), shall be paid directly to
Developer as its interests may appear, and Developer shall forthwith repair,
reconstruct and restore the Minimum Improvements to substantially the
same or an improved condition or value as they existed prior to the event
causing such damage and, to the extent necessary to accomplish such
repair, reconstruction and restoration, Developer shall apply the Net
Proceeds of any insurance relating to such damage received by Developer
to the payment or reimbursement of the costs thereof, subject, however, to
the terms of any mortgage encumbering title to the Property (as its interests
may appear). Developer shall complete the repair, reconstruction and
restoration of Minimum Improvements whether or not the Net Proceeds of
insurance received by Developer for such Purposes are sufficient.
4.8 Preservation of Property. During the term of this Agreement, Developer shall
maintain, preserve and keep, or cause others to maintain, preserve and keep, the
Minimum Improvements in good repair and working order, ordinary wear and tear
excepted, and from time to time shall make all necessary repairs, replacements,
6
renewals and additions. Nothing in this Agreement, however, shall be deemed to
alter any agreements between Developer or any other party including, without
limitation, any agreements between the parties regarding the care and maintenance
of the Property.
4.9 Non-Discrimination. In carrying out the project, Developer shall not
discriminate against any employee or applicant for employment because of race,
religion, color, sex, sexual orientation, national origin, age or disability.
4.10 Conflict of Interest. Developer agrees that no member, officer or employee
of City, or its designees or agents, nor any consultant or member of the governing
body of City, and no other public official of City who exercises or has exercised any
functions or responsibilities with respect to the project during his or her tenure, or
who is in a position to participate in adecision-making process or gain insider
information with regard to the project, shall have any interest, direct or indirect, in
any contract or subcontract, or the proceeds thereof, for work to be performed in
connection with the project, or in any activity, or benefit therefrom, which is part of
this project at any time during or after such person's tenure. In connection with this
obligation, Developer shall have the right to rely upon the representations of any
party with whom it does business and shall not be obligated to perform any further
examination into such party's background.
4.11 Restrictions on Use. Developer agrees for itself, and its successors and
assigns, and every successor in interest to the Property or any part thereof that
they, and their respective successors and assigns, shall:
(1) Devote the Property to, and only to and in accordance with, the uses
specified in the Urban Renewal Plan (and City represents and agrees that
use of the Property as an industrial manufacturing facility is in full
compliance with the Urban Renewal Plan) (however, Developer shall not
have any liability to City to the extent that a successor in interest shall breach
this covenant and City shall seek enforcement of this covenant directly
against the party in breach of same); and
(2) Not discriminate upon the basis of race, religion, color, sex, sexual
orientation, national origin, age or disability in the sale, lease, rental, use or
occupancy of the Property or any improvements erected or to be erected
thereon, or any part thereof (however, Developer shall not have any liability
to City to the extent that a successor in interest shall breach this covenant
and City shall seek enforcement of this covenant directly against the party in
breach of same).
4.12 Release and Indemnification Covenants.
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(1) Developer releases City and the governing body members, officers,
agents, servants and employees thereof (hereinafter, for purposes of this
Section, the Indemnified Parties) from, covenants and agrees that the
Indemnified Parties shall not be liable for, and agree to indemnify, defend
and hold harmless the Indemnified Parties against, any loss or damage to
property or any injury to or death of any person occurring at or about or
resulting from any defect in the Minimum Improvements.
(2) Except for any gross negligence, willful misrepresentation or any
willful or wanton misconduct or any unlawful act of the Indemnified Parties,
Developer agrees to protect and defend the Indemnified Parties, now or
forever, and further agrees to hold the Indemnified Parties harmless, from
any claim, demand, suit, action or other proceedings whatsoever by any
person or entity whatsoever arising or purportedly arising from (1) any
violation of any agreement or condition of this Agreement (except with
respect to any suit, action, demand or other proceeding brought by
Developer against City based on an alleged breach of any representation,
warranty or covenant of City under this Agreement and/or to enforce its
rights under this Agreement); or (2) the acquisition, construction, installation,
ownership, and operation of the Minimum Improvements; or (3) the condition
of the Property and any hazardous substance or environmental
contamination located in or on the Property, caused and occurring after
Developer takes possession of the Property.
(3) The Indemnified Parties shall not be liable to Developer for any
damage or injury to the persons or property of Developer or its officers,
agents, servants or employees or any other person who may be on, in or
about the Minimum Improvements due to any act of negligence of any
person, other than any act of negligence on the part of any such Indemnified
Party or its officers, agents, servants or employees.
(4) All covenants, stipulations, promises, agreements and obligations of
City contained herein shall be deemed to be the covenants, stipulations,
promises, agreements and obligations of City, and not of any governing body
member, officer, agent, servant or employee of City in their individual
capacity thereof.
(5) The provisions of this Section shall survive the termination of this
Agreement.
4.13 Compliance with Laws. Developer shall comply with all laws, rules and
regulations relating to its businesses, other than laws, rules and regulations for
which the failure to comply with or the sanctions and penalties resulting therefrom,
would not have a material adverse effect on the business, property, operations,
financial or otherwise, of Developer.
8
4.14 Opinion of Developer's Counsel. At the time of execution of this Agreement
by Developer, Developer shall provide City with an Opinion of Developer's Counsel
in the form of Exhibit C attached hereto.
SECTION 5. EVENTS OF DEFAULT AND REMEDIES
5.1 Events of Default Defined. The following shall be Events of Default under
this Agreement and the term Event of Default shall mean, whenever it is used in
this Agreement, any one or more of the following events:
(1) Failure by Developer to pay or cause to be paid, before delinquency,
all real property taxes assessed with respect to the Minimum Improvements
and the Property. After the issuance of the Certificate of Completion,
however, such event shall not entitle City to the remedy provided in Section
5.3.
(2) Failure by Developer to maintain the Minimum Improvements
pursuant to the terms, conditions and limitations of this Agreement.
(3) Failure by Developer or City to substantially observe or perform any
other material covenant, condition, obligation or agreement on its part to be
observed or performed under this Agreement.
5.2 Remedies on Default by Developer. Whenever any Event of Default referred
to in Section 5.1 of this Agreement occurs and is continuing, City, as specified
below, may take any one or more of the following actions after the giving of written
notice by City to Developer (and the holder of any mortgage encumbering any
interest in the Property of which City has been notified of in writing) of the Event of
Default, but only if the Event of Default has not been cured within sixty (60) days
following such notice, or if the Event of Default cannot be cured within sixty (60)
days and Developer does not provide assurances to City that the Event of Default
will be cured as soon as reasonably possible thereafter:
(1) City may suspend its performance under this Agreement until it
receives assurances from the defaulting party, deemed adequate by City,
that the defaulting party will cure its default and continue its performance
under this Agreement;
(2) City shall be entitled to recover from Developer the sum of all
amounts expended by City in connection with the funding of the Acquisition
Grant and Economic Development Grant to Developer, and City may take
any action, including any legal action it deems necessary, to recover such
amounts from Developer; or
9
(3) City may take any action, including legal, equitable or administrative
action, which may appear necessary or desirable to collect any payments
due under this Agreement or to enforce performance and observance of any
obligation, agreement, or covenant under this Agreement.
5.3 No Remedy Exclusive. Except as otherwise provided in this Agreement, no
remedy herein conferred upon or reserved to City is intended to be exclusive of any
other available remedy or remedies, but each and every such remedy shall be
cumulative and shall be in addition to every other remedy given under this
Agreement or now or hereafter existing at law or in equity or by statute. No delay or
omission to exercise any right or power accruing upon any default shall impair any
such right or power or shall be construed to be a waiver thereof, but any such right
and power may be exercised from time to time and as often as may be deemed
expedient.
5.4 No Implied Waiver. In the event any agreement contained in this Agreement
should be breached by any party and thereafter waived by any other party, such
waiver shall be limited to the particular breach so waived and shall not be deemed
to waive any other concurrent, previous or subsequent breach hereunder.
5.5 A_ greement to Pay Attorneys' Fees and Expenses. If any action at law or in
equity, including an action for declaratory relief or arbitration, is brought to enforce
or interpret the provisions of this Agreement, the prevailing party shall be entitled to
recover reasonable attorneys' fees and costs of litigation from the other party. Such
fees and costs of litigation may be set by the court in the trial of such action or by
the arbitrator, as the case may be, or may be enforced in a separate action brought
for that purpose. Such fees and costs of litigation shall be in addition to any other
relief that may be awarded.
5.6 Remedies on Default by City. If City defaults in the performance of this
Agreement, Developer may take any action, including legal, equitable or
administrative action that may appear necessary or desirable to collect any
payments due under this Agreement, to recover expenses of Developer, or to
enforce performance and observance of any obligation, agreement, or covenant of
City under this Agreement. Developer may suspend its performance under this
Agreement until they receive .assurances from City, deemed adequate by
Developer, that City will cure its default and continue its performance under this
Agreement.
SECTION 6. GENERAL TERMS AND PROVISIONS
6.1 Notices and Demands. Whenever this Agreement requires or permits any
notice or written request by one party to another, it shall be deemed to have been
properly given if and when delivered in person or three (3) business days after
10
having been deposited in any U.S. Postal Service and sent by registered or certified
mail, postage prepaid, addressed as follows:
If to Developer: Mark Klausner
General Manager
American Tank & Fabrication, Co.
8025 Chavenelle Rd.
Dubuque, IA 52002
Phone:563-556-5889
Fax: 563-556-5870
With copy to:
If to City: City Manager
50 W. 13th Street
Dubuque, Iowa 52001
Phone: (563) 589-4110
Fax: (563) 589-4149
With copy to: City Attorney
City Hall
50 W. 13th Street
Dubuque, IA 52001
Or at such other address with respect to any party as that party may, from time to
time designate in writing and forward to the other as provided in this Section.
6.2 Binding Effect. This Agreement shall be binding upon and shall inure to the
benefit of City, Developer and their respective successors and assigns.
6.3 Termination Date. This Agreement and the rights and obligations of the
parties hereunder shall terminate on May 1, 2018 (the Termination Date).
6.4. Execution By Facsimile. The parties agree that this Agreement may be
transmitted among them by facsimile machine. The parties intend that the
faxed signatures constitute original signatures and that a faxed Agreement
containing the signatures (original or faxed) of all the parties is binding on the
parties.
6.5 Memorandum of Development Agreement. City shall promptly record a
Memorandum of Development Agreement in the form attached hereto as
11
Exhibit E in the office of the Recorder of Dubuque County, Iowa. Developer
shall pay the costs for so recording.
CITY OF DUBUQUE, IOWA
By:
By:
Roy D. Buol, Mayor
Jeanne F. Schneider, City Clerk
AMERICAN TANK & FABRICATION,
CO.
f
By:
Mark Klausner, General Manager
12
List of Exhibits
Exhibit A Urban Renewal Plan
Exhibit B Legal Description
Exhibit C Opinion of Counsel to Developer
Exhibit D Minimum Assessment Agreement
Exhibit E Memorandum of Development Agreement
13
EXHIBIT A
URBAN RENEWAL PLAN
14
AMENDED and RESTATED
URBAN RENEWAL PLAN
Dubuque Industrial Center Economic Development District
City of Dubuque, Iowa
This Amended and Restated Urban Renewal Plan provides for the
continued development of the Dubuque Industrial Center Economic
Development District, originally established by Resolution 130-88 of
the City Council of the City of Dubuque, Iowa on May 2, 1988 and
thereafter amended and restated by Resolution 484-90 on
December 17, 1990, Resolution 142-97 on April 7, 1997, Resolution
478-97 on November 17, 1997, Resolution 15-08 on January 7,
2008, Resolution 101-08 on March 17, 2008, and Resolution
on April 7, 2008.
Prepared by the Economic Development Department.
Version 2008.3
15
TABLE OF CONTENTS
A.
B.
C.
D.
E.
F.
G.
H.
I.
J.
K.
L.
INTRODUCTION ................................................................................................ 17
OBJECTIVES ..................................................................................................... 17
DISTRICT BOUNDARIES .................................................................................. 18
PUBLIC PURPOSE ACTIVITIES ....................................................................... 19
DEVELOPMENT 8~ REDEVELOPMENT REQUIREMENTS .............................. 20
LAND ACQUISITION AND DISPOSITION ......................................................... 20
FINANCING ACTIVITIES ................................................................................... 21
STATE AND LOCAL REQUIREMENTS ............................................................ 22
DURATION OF APPROVED URBAN RENEWAL PLAN ................................... 22
SEVERABILITY .................................................................................................. 23
AMENDMENT OF APPROVED URBAN RENEWAL PLAN .............................. 23
ATTACHMENTS ................................................................................................. 2 3
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AMENDED and RESTATED
DUBUQUE INDUSTRIAL CENTER ECONOMIC DEVELOPMENT DISTRICT
URBAN RENEWAL PLAN
City of Dubuque, Iowa
A. INTRODUCTION
This AMENDED and RESTATED URBAN RENEWAL PLAN (the "Plan") has been prepared to
provide for the further development and redevelopment of the DUBUQUE INDUSTRIAL CENTER
ECONOMIC DEVELOPMENT DISTRICT (the "District") first established by the City of Dubuque on
May 2, 1988. Its intent is to stimulate economic development activities within the expanded District
through the commitment of public actions as specified herein.
To achieve this objective, the City of Dubuque shall undertake the urban renewal actions specified in
this Plan, pursuant to the powers granted to it under Chapter 403 of the Iowa Code, Urban Renewal
Law.
This Plan is an amendment and restatement of the Dubuque Industrial Center Economic
Development District Urban Renewal Plan adopted by Resolution 130-88 of the City Council of the
City of Dubuque, Iowa on May 2, 1988 and subsequently amended by Resolution 484-90 on
December 17, 1990, Resolution 142-97 on April 7, 1997, Resolution 478-97 on November 17, 1997,
Resolution 15-08 on January 7, 2008, Resolution 101-08 on March 17, 2008, and Resolution on
April 7, 2008. This Plan shall serve as a new urban renewal plan for the District described herein.
The division of taxation authorized by Section 403.19 and the separation of incremental taxes as
defined in Section 403.19(2) have been implemented in the existing area of the District (the different
areas of the district hereinafter referred to as Subareas). Under the terms of this Amended and
Restated Plan, the tax increment mechanism shall be continued and implemented within the revised
area of the District as well. The revised District shall be subject to the provisions of a revised
ordinance of the City of Dubuque with respect to the division of taxes levied and collected within each
of Subareas A, B, C, and D of the District. Incremental taxes shall continue to be determined
separately with respect to each of the Subareas comprising the District, and when collected shall be
applied, subject to such liens and priorities as may exist or be from time to time provided, with
respect to the Amended and Restated Dubuque Industrial Center Economic Development District, as
so amended.
B. OBJECTIVES
The primary objectives of the Plan are the development and redevelopment of the District for
economic development activities, primarily industrial park development, through:
Provision of marketable industrial development sites for the purpose of job-creating
economic development activities;
2. Provision of public infrastructure improvements, including sanitary sewer, water and
stormwater detention, supportive of full development of the District;
3. Provision of a safe, efficient and attractive circulation system;
4. Establishment of design standards which will assure cohesive and compatible
development and redevelopment of the District;
17
5. Provision of public amenities that provide an aesthetically appealing environment,
including open space, buffering, landscaping, water features, signage and lighting to
create a distinctive and attractive setting;
6. Creation of financial incentives necessary to encourage new and existing businesses
to invest in the District; and
7. Expansion of the property tax base of the District.
C. DISTRICT BOUNDARIES
The District is located within the City of Dubuque, County of Dubuque, State of Iowa. The City of
Dubuque believes that the objectives of the Plan can best be accomplished by defining the real
property included within the District as four separate areas so as to distinguish the original District
(Subarea A) from the subsequent expansion areas (Subareas B, C, and D).
Subarea A of the District shall consist of the real property legally described as follows:
All of the Dubuque Industrial Center First, Second, Third, Fourth, Fifth, Sixth, Seventh,
Eighth, Ninth, Tenth and Eleventh Additions and the adjoining public right-of-way, all in the
City of Dubuque, Dubuque County, Iowa.
Subarea B of the District shall consist of the real property legally described as follows:
• Lots 1, 3, 4, 1 of 5, 6 and H of Dubuque Industrial Center West; and
• Lots 1, 2, 3, 4, 5, 6, 7, 8, and C of Dubuque Industrial Center West 2"d Addition; and
• Lots 1, 2, 3, 4, B, and C of Dubuque Industrial Center West 4th Addition; and
• Lots 1 of 1, 1 of 2, 2 of 2, 1 of 3, 2 of 3, 1 of 5, A, C, and D of Dubuque Industrial Center
West 5th Addition; and
• Lots 1, 2, and A of Dubuque Industrial Center West 6th Addition; and
• Lots 1, 1 of 2, and 2 of 2 of Dubuque Industrial Center West 7th Addition; and
• Lot 2 of 1 of the Southwest Quarter of the Southwest Quarter and Lot 2 of 1 of the Southeast
Quarter of the Southwest Quarter all in Section 30, Township 89 North, Range 2 East, 5th
Principal Meridian;
• and all that part of a 100-foot-wide strip of the Chicago Central Pacific Railroad right-of-way
lying in the SE 1!4 of Section 30, the SE 1/4 of the SW 1/4 of Section 30, the NW 1/4 of
Section 31, and the NE 1/4 of Section 31 all in T89N, R2E, of the 5th P.M. Dubuque County,
Iowa, the centerline of which is more particularly described as follows: beginning at a poirit of
intersection with the easterly line of the SE 1/4 of Section 30, T89N, R2E, of the 5th P.M.,
thence southwesterly along the centerline of said railroad 2,700 feet, more or less a point of
intersection with the westerly line of the SE 1/4 of said Section 30; thence southwesterly
continuing along said centerline 845 feet, more or less, to a point where the railroad right-of-
waywidens to 200 feet, said point being the terminus of this description; and
• all that part of a 100-foot-wide strip of the Chicago Central Pacific Railroad right-of-way lying
in the Balance of Lot 1 of 1 of the Southwest Quarter of the Southwest Quarter in Section 29,
Township 89 North, Range 2 East, 5th Principal Meridian; and
• any adjoining public street right-of-way all in the City of Dubuque, Dubuque County, Iowa.
Subarea C of the District shall consist of the real property legally described as follows:
• Lot 1-1 NW 1/4-NE 1/4; Lot 2 of E 10 acres NE 1/4-NW 1/4; Lot 2-1 NW 1/4-NE 1/4; Lot 2
NW 1/4-NE 1/4; Lot 1 E 1/4 NE 1/4-NW 1/4; W 3/4 NE 1/4-NW 1/4; Lot 2-1 SE 1/4-NW 1/4;
Lot 1-1 SE 1/4-NW 1/4; and the SW 1/4-NE 1/4 all in Section 30, Township 89 North, Range
18
2 East, 5th Principal Meridian; and any adjoining public street right-of-way in the City of
Dubuque, Dubuque County.
Subarea D of the District shall consist of the real property legally described as follows:
• Lot 4 of Dubuque Industrial Center West 5th Addition, and Lot B of Dubuque Industrial
Center West 5th Addition in the City of Dubuque, Iowa.
The boundaries of the District are delineated on the URBAN RENEWAL DISTRICT map (Attachment
A).
The City of Dubuque reserves the right to modify the boundaries of the District at some future date
Any amendments to the Plan will be completed in accordance with Chapter 403 of the Iowa Code
Urban Renewal Law.
D. PUBLIC PURPOSE ACTIVITIES
To meet the OBJECTIVES of this Plan, the City of Dubuque is prepared to initiate and support
development and redevelopment of the District through, among other things, the following PUBLIC
PURPOSE ACTIVITIES:
1. Acquisition of property for public improvements and private development;
2. Demolition and removal of buildings and improvements not compatible with or
necessary for industrial park development and all site preparation and grading
required in connection with such development;
3. Improvement, installation, construction and reconstruction of streets, utilities and
other improvements and rights-of-ways including but not limited to the relocation of
overhead utility lines, street lights, construction of railroad spur tracks, appropriate
landscaping and buffers, open space and signage;
4. Disposition of any property acquired in the District, including sale, initial leasing or
retention by the City itself, at its fair value;
5. Preparation of property for development and redevelopment purposes including but
not limited to activities such as appraisals and architectural and engineering studies;
6. Use of tax increment financing, loans, grants and other appropriate financial tools in
support of eligible public and private development and redevelopment efforts;
7. Enforcement of applicable local, state and federal laws, codes and regulations;
8. Enforcement of established design standards in furtherance of quality development;
9. Development and implementation of a marketing program for the purpose of
promoting the purchase and development of industrial sites by private developers;
10. Coordination and cooperation with the improvement of Seippel Road as it affects
Subarea B's accessibility to U.S. Highway 20.
Public purpose activities are limited to those areas delineated on the PUBLIC PURPOSE ACTIVITY
AREA map (Attachment B).
All public purpose activities shall be conditioned upon and shall meet the restrictions and limitations
19
placed upon the District by the Plan.
E. DEVELOPMENT & REDEVELOPMENT REQUIREMENTS
The LAND USE and PLANNING AND DESIGN CRITERIA set forth herein shall apply to any and all
District properties the development and/or the redevelopment of which is assisted by the City through
any of the PUBLIC PURPOSE ACTIVITIES listed above.
Land Use
Subareas A, B, C, and D shall continue to be developed under the regulations of the existing
Dubuque Industrial Center Planned Industrial District. The allowed uses provide for a mix of
commercial and industrial land use activities within a quality industrial park setting.
LAND USE maps (Attachments C1 and C2) identify the existing and the proposed
land uses within Subareas A, B, C, and D.
2. Planning and Design Criteria
The planning criteria to be used to guide the physical development of Subareas A, B, C, and
D are those standards and guidelines contained within the City of Dubuque's Zoning
Ordinance and other applicable local, state and federal codes and ordinances.
a. Subarea A development will continue to be additionally governed by the Conditions
of Development and Operation Documents of the Dubuque Industrial Center
Planned Industrial District as amended from time to time.
b. Subareas B, C, and D will develop under a PI Planned Industrial District ordinance as
required by Section 3-5.5 of the City of Dubuque Zoning Ordinance. Development
will follow the Planned Unit Development regulations which require a conceptual
development plan and specific design and performance standards to be approved by
ordinance.
F. LAND ACQUISITION AND DISPOSITION
The City of Dubuque is prepared to acquire and dispose of property in support of the development
and redevelopment of the District within the parameters set forth below.
Land Acauisition
All necessary land acquisitions have been completed in Subareas A and B of the District.
The City may acquire additional property in Subarea C in the future.
2. Land Disposition
Publicly held land will be sold for the development of viable uses consistent with this Plan and
not for purposes of speculation.
Land will be disposed of in accordance with the requirements set forth in Chapter 403 of the
Iowa Code, Urban Renewal Law. Developers will be selected on the basis of the quality of
their proposals and their ability to carry out such proposals while complying with the
requirements of this Plan.
Developers will be required by contractual agreement to observe the Land Use
Requirements and Planning and Design Criteria of this Plan. The contract and other
20
disposition documents will set forth the provisions, standards and criteria for achieving the
objectives and requirements outlined in this Plan.
Relocation Reauirements
No relocation is anticipated at this time.
G. FINANCING ACTIVITIES
To meet the OBJECTIVES of this Plan and to encourage the development of the District and private
investment therein, the City of Dubuque is prepared to provide financial assistance to qualified
industries and businesses through the making of loans or grants under Chapter 15A of the Iowa
Code and through the use of tax increment financing under Chapter 403 of the Iowa Code.
Chapter 15A Loan or Grant
The City of Dubuque has determined that the making of loans or grants of public funds to
qualified industries and businesses is necessary to aid in the planning, undertaking and
completion of urban renewal projects authorized under this Plan within the meaning of
Section 384.24(3)(q) of the Iowa Code. Accordingly, in furtherance of the objectives of this
Plan, the City of Dubuque may determine to issue bonds or loan agreements, in reliance
upon the authority of Section 384.24A, Section 384.24(3)(q), Section 403.12 (general
obligation bonds) or Section 403.9 (tax increment bonds), for the purpose of making loans or
grants of public funds to qualified businesses. Alternatively, the City may determine to use
available funds for the making of such loans or grants. In determining qualifications of
recipients and whether to make any such individual loans or grants, the City of Dubuque shall
consider one or more of the factors set forth in Section 15A.1 of the Iowa Code on a case-by-
case basis.
2. Tax Increment Financina
The City of Dubuque is prepared to utilize tax increment financing as a means of financing
eligible costs incurred to implement the Public Purpose Activities identified in Part D of this
Plan. Bonds, tax rebate agreements and\or loan agreements may be issued by the City
under the authority of Section 403.9 of the Iowa Code (tax increment bonds) or Section
384.24A, Section 384.24(3)(q) and Section 403.12 (general obligation bonds).
The City acknowledges that the use of tax increment revenues delays the ability of other local
taxing bodies to realize immediately the direct tax benefits of new development in the District.
The City believes, however, that the use of tax increment revenues to finance the
development of new industrial land and to promote private investment in the District is
necessary in the public interest to achieve the OBJECTIVES of this Plan. Without the use of
this special financing tool, new investment may not otherwise occur or may occur within
another jurisdiction. If new development does not take place in Dubuque, property values
could stagnate and the City, County and School District may receive less taxes during the
duration of this Plan than they would have if this Plan were not implemented.
Tax increment financing will provide along-term payback in overall increased tax base for
the City, County and School District. The initial public investment required to generate new
private investment will ultimately increase the taxable value of the District well beyond its
existing base value.
Tax increment reimbursement may be sought for, among other things, the following costs to
the extent they are incurred by the City:
21
a. Planning and administration of the Plan;
b. Construction of public infrastructure improvements and facilities within the District;
c. Acquisition, installation, maintenance and replacement of public investments
throughout the District including but not limited to street lights, landscaping and
buffers, signage and appropriate amenities;
d. Acquisition of land and/or buildings and preparation of same for sale or lease to
private developers, including any "write down" of the sale price of the land and/or
building;
e. Preservation, conservation, development or redevelopment of buildings or facilities
within the District to be sold or leased to qualified businesses;
f. Loans or grants to qualified businesses under Chapter 15A of the Iowa Code,
including tax rebate payments, debt service payments on any bonds issued to
finance such loans or grants, for purposes of expanding the business or activity, or
other qualifying loan programs established in support of the Plan; and
g. Providing the matching share for a variety of local, state and federal grants and
loans.
3. Proposed Amount of Indebtedness
At this time, the extent of improvements and new development within the District is only
generally known. As such, the amount and duration for use of the tax increment revenues
for public improvements and/or private development can only be estimated; however, the
actual use and amount of tax increment revenues to be used by the City for District activities
will be determined at the time specific development is proposed.
It is anticipated that the maximum amount of indebtedness which will qualify for tax
increment revenue reimbursement during the duration of this Plan, including acquisition,
public improvements and private development assistance, will not exceed $70,000,000.
At the time of adoption of this Plan, the City of Dubuque's current general obligation debt is $
69,946,580 (a list of obligations is found as Attachment D) and the applicable constitutional
debt limit is $163,487,198.
H. STATE AND LOCAL REQUIREMENTS
All provisions necessary to conform with state and local laws have been complied with by the City of
Dubuque in the implementation of this Plan and its supporting documents.
I. DURATION OF APPROVED URBAN RENEWAL PLAN
1. Subarea A
This Plan shall continue in effect until terminated by action of the City Council, but in no event
before the City of Dubuque has received full reimbursement from all incremental taxes of its
advances and principal and interest payable on all Tax Increment Financing or general
obligations issued to carry out the OBJECTIVES of the Plan.
2. Subarea B
22
This Plan shall continue in effect until terminated by the City Council; provided, however, that
the collection of tax increment revenues from properties located in Subarea B shall be limited
to twenty (20) years from the calendar year following the calendar year in which the City first
certifies to the County Auditor the amount of any loans, advances, indebtedness or bonds
which qualify for payment from the division of tax increment revenue provided for in Section
403.19 (tax increment financing) of the Iowa Code.
3. Subarea C
This Plan shall continue in effect until terminated by the City Council; provided, however, that
the collection of tax increment revenues from properties located in Subarea C shall be limited
to twenty (20) years from the calendar year following the calendar year in which the City first
certifies to the County Auditor the amount of any loans, advances, indebtedness or bonds
which qualify for payment from the division of tax increment revenue provided for in Section
403.19 (tax increment financing) of the Iowa Code.
4. Subarea D
This Plan shall continue in effect until terminated by the City Council; provided, however, that
the collection of tax increment revenues from properties located in Subarea D shall be limited
to twenty (20) years from the calendar year following the calendar year in which the City first
certifies to the County Auditor the amount of any loans, advances, indebtedness or bonds
which qualify for payment from the division of tax increment revenue provided for in Section
403.19 (tax increment financing) of the Iowa Code.
The DEVELOPMENT AND REDEVELOPMENT REQUIREMENTS established, or as amended from
time to time by the City of Dubuque Zoning Ordinance, shall remain in effect in perpetuity.
J. SEVERABILITY
In the event one or more provisions contained in this Plan shall be held for any reason to be invalid,
illegal, unauthorized or unenforceable in any respect, such invalidity, illegality, unauthorization or
unenforceability shall not affect any other provision of this Plan and this Urban Renewal Plan shall be
construed and implemented as if such provision had never been contained herein.
K. AMENDMENT OF APPROVED URBAN RENEWAL PLAN
This Plan may be amended from time to time to respond to development opportunities. Any such
amendment shall conform to the requirements of Chapter 403 of the Iowa Code. Any change
effecting any property or contractual right can be effectuated only in accordance with applicable state
and local law.
L. ATTACHMENTS
A Urban Renewal District Map
B Public Purpose Activity Area Map
C Land Use Maps
C1 Existing Land Use
C2 Proposed Land Use
D List of General Obligations
23
EXHIBIT B
LEGAL DESCRIPTION
Lots 7 and 8 Dubuque Industrial Center West 2"d Addition
24
EXHIBIT C
OPINION OF DEVELOPER'S COUNSEL
25
Mayor and City Councilmembers
City Hall
13t and Central Avenue
Dubuque IA 52001
Re: Development Agreement Between the City of Dubuque, Iowa and
Dear Mayor and City Councilmembers:
We have acted as counsel for (Developer) in
connection with the execution and delivery of a certain Development Agreement
(Development Agreement) between Developer and the City of Dubuque, Iowa
("City") dated for reference purposes the day of , 20_.
We have examined the original certified copy, or copies otherwise identified
to our satisfaction as being true copies, of the Development Agreement and such
other documents and records as we have deemed relevant and necessary as a
basis for the opinions set forth herein.
Based on the pertinent law, the foregoing examination and such other
inquiries as we have deemed appropriate, we are of the opinion that:
1. Developer is a limited liability company organized and existing under
the laws of the State of and has full power and authority to execute,
deliver and perform in full Development Agreement. The Development Agreement
has been duly and validly authorized, executed and delivered by Developer and,
assuming due authorization, execution and delivery by City, is in full force and
effect and is valid and legally binding instrument of Developer enforceable in
accordance with its terms, except as the same may be limited by bankruptcy,
insolvency, reorganization or other laws relating to or affecting creditors' rights
generally.
2. The execution, delivery and performance by Developer of the
Development Agreement and the carrying out of the terms thereof, will not result in
violation of any provision of, or in default under, the articles of incorporation and
bylaws of Developer, any indenture, mortgage, deed of trust, indebtedness,
agreement, judgment, decree, order, statute, rule, regulation or restriction to which
Developer is a party or by which Developer's property is bound or subject.
3. There are no actions, suits or proceedings pending or threatened
against or affecting Developer in any court or before any arbitrator or before or by
any governmental body in which there is a reasonable possibility of an adverse
decision which could materially adversely affect the business (present or
26
prospective), financial position or results of operations of Developer or which in any
manner raises any questions affecting the validity of the Agreement or the
Developer's ability to perform Developer's obligations thereunder.
Very truly yours,
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EXHIBIT D
MINIMUM ASSESSMENT AGREEMENT
28
MINIMUM ASSESSMENT AGREEMENT
CITY OF DUBUQUE, IOWA
City of Dubuque, Iowa
THIS AGREEMENT, dated for reference purposes the day of
2008, by and among the City of Dubuque, Iowa (City),
(Developer), and the City Assessor of the City of Dubuque,
Iowa (the Assessor).
WHEREAS, on or before the date hereof City and Developer have entered
into a Development Agreement regarding certain real property (the Property)
described in Exhibit A attached hereto, located within the City of Dubuque; and
WHEREAS, it is contemplated that Developer will undertake the
development of an area (the Project) within the Dubuque Industrial Center
Economic Development District by the maintenance of the Minimum Improvements
on the Property as provided in the Development Agreement; and
WHEREAS, pursuant to Section 403.06 of the Iowa Code, as amended, City
and Developer desire to establish a minimum market value for the Minimum
Improvements and the Property, which shall be effective upon execution of this
Agreement and from then until this Agreement is terminated pursuant to the terms
herein and which is intended to reflect the minimum market value of the Minimum
Improvements and the Property; and
NOW, THEREFORE, the parties to this Agreement, in consideration of the
promises, covenants and agreements made by each other, do hereby agree as
follows:
1) The minimum market value which shall be fixed for assessment purposes
for the Property described as Lots 7 and 8 Dubuque Industrial Center West 2"d
Addition, together with the Minimum Improvements thereon ("the Minimum Actual
Value") shall be not less than One Million dollars ($1,000,000.00), until termination
of this Agreement. The Minimum Actual Value shall be maintained during such
period regardless of (a) any failure to complete the Minimum Improvements (b)
destruction of all or any portion of the Minimum Improvements (c) diminution in
value of the Property or the Minimum Improvements or (d) any other circumstance,
whether known or unknown and whether now existing or hereafter occurring.
2) The Minimum Market Value herein established shall be of no further force
and effect and this Agreement shall terminate on the 30~h day of June, 2016, the
final date of the City's obligation to pay interest or principal with respect to the
29
indebtedness incurred in support of the project, dated the day of ,
in the principal amount of $ .The final scheduled maturity date of
the said indebtedness is June 30, 2016. Provided, further, that in the event said
indebtedness had not been fully paid as to principal and interest as of January 1,
2016, this Agreement shall continue in effect for such additional time as shall be
required therefore, but not later than January 1, 2018.
3) Developer shall pay, when due, all real property taxes and
assessments payable with respect to all and, any parts of the Property and the
Minimum Improvements pursuant to the provisions of this Minimum Assessment
Agreement and the Development Agreement. Such tax payments shall be made
without regard to any loss, complete or partial, to the Property or the Minimum
Improvements, any interruption in, or discontinuance of, the use, occupancy,
ownership or operation of the Property or the Minimum Improvements by Developer
or any other matter or thing which for any reason interferes with, prevents or
renders burdensome the use or occupancy of the Property or the Minimum
Improvements.
4) Developer agrees that its obligations to make the tax payments
required hereby, to pay the other sums provided for herein, and to perform and
observe its other agreements contained in this Minimum Assessment Agreement
and in the Development Agreement shall be absolute and unconditional general
obligations of Developer (not limited to the statutory remedies for unpaid taxes) and
that Developer shall not be entitled to any abatement or diminution thereof, or set
off therefrom, nor to any termination of this Minimum Assessment Agreement for
any reason whatsoever. Developer agrees not to request or accept any abatement,
settlement or other diminution of taxes resulting from the application of prevailing
tax rates to the Minimum Actual Value.
5) Developer agrees that prior to the Termination Date it will not:
(a) seek administrative review or judicial review of the applicability
or constitutionality of any tax statute relating to the taxation of property
contained as a part of the Property or the Minimum Improvements
determined by any tax official to be applicable to the Property, the Minimum
Improvements or Developer or raise the inapplicability or constitutionality of
any such tax statute as a defense in any proceedings, including delinquent
tax proceedings; or
(b) seek any tax deferral or abatement, either presently or
prospectively authorized under Iowa Code Chapter 403 or 404, or any other
State or federal law, of the taxation of real property including improvements
and fixtures thereon, contained in the Development Property or the Minimum
Improvements between the date of execution of this Agreement and the
Termination Date; or
30
(c) request the Assessor to reduce the Minimum Actual Value; or
(d) appeal to the board of review of the County, State or to the
Director of Revenue of the State to reduce the Minimum Actual Value; or
(e) cause a reduction in the actual value or the Minimum Actual
Value through any other proceedings.
6) This Minimum Assessment Agreement shall be promptly recorded by
City with the Recorder of Dubuque County, Iowa. Such filing shall constitute notice
to any subsequent encumbrancer or purchaser of the Property (or part thereof),
whether voluntary or involuntary, and this Minimum Assessment Agreement shall
be binding and enforceable in its entirety against any such subsequent purchaser
or encumbrancer, including the holder of any mortgage. Developer shall pay all
costs of recording.
7) Neither the preambles nor provisions of this Agreement are intended
to, nor shall be construed as, modifying the terms of this Agreement between City
and Developer.
8) This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of the parties.
9) This Minimum Assessment Agreement shall not be assignable by
Developer without the consent of City and shall not be assignable by City without
the consent of Developer.
10) Nothing herein shall be deemed to waive Developer's rights under
Iowa Code Section 403.6(19) to contest that portion of any actual value assignment
made by the Assessor in excess of the Minimum Actual Value established herein.
In no event, however, shall Developer seek to reduce the actual value to an amount
below the Minimum Actual Value established herein during the term of this
Agreement. This Minimum Assessment Agreement may be amended or modified
and any of its terms, covenants, representations, warranties or conditions waived,
only by a written instrument executed by the parties hereto, or in the case of a
waiver, by the party waiving compliance.
11) If any term, condition or provision of this Minimum Assessment
Agreement is for any reason held to be illegal, invalid or inoperable, such illegality,
invalidity or inoperability shall not affect the remainder hereof, which shall at the
time be construed and enforced as if such illegal or invalid or inoperable portion
were not contained herein.
12) The Minimum Actual Value herein established shall be of no further
force and effect and this Minimum Assessment Agreement shall terminate on the
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Termination Date.
THE CITY OF DUBUQUE, IOWA
By:
Roy Buol, Mayor
ATTEST:
By:
Jeanne Schneider, City Clerk
STATE OF IOWA )
SS
COUNTY OF DUBUQUE )
On this day of 2008, before me a Notary
Public in and for said County, personally appeared Roy Buol and Jeanne Schneider
to me personally known, who being duly sworn, did say that they are the Mayor and
City Clerk, respectively of the City of Dubuque, Iowa, a Municipal Corporation,
created and existing under the laws of the State of Iowa, and that the seal affixed to
the foregoing instrument is the seal of said Municipal Corporation, and that said
instrument was signed and sealed on behalf of said Municipal Corporation by
authority and resolution of its City Council and said Mayor and City Clerk
acknowledged said instrument to be the free act and deed of said Municipal
Corporation by it voluntarily executed.
Notary Public in and for the State of Iowa
32
AMERICAN TANK &
FABRICATION, CO.
By:
Title:
STATE OF IOWA )
SS
COUNTY OF DUBUQUE )
On this day of 2007, before
me a Notary Public in and for the State of Iowa, personally appeared
to me personally known, who being duly sworn, did
say that he is the of AMERICAN TANK & FABRICATION,
CO., an Iowa corporation, who executed the foregoing instrument; and that
acknowledged the execution of said
instrument to be his voluntary act and deed, voluntarily executed.
Notary Public in and for said County and
State
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CONSENT TO MINIMUM ASSESSMENT AGREEMENT
The undersigned, being the holder of one or more mortgages granted prior
to the date of the Minimum Assessment Agreement to which this Consent is
attached, said mortgage(s) encumbering a portion of the Property described
therein, hereby consents to the execution and recording of the foregoing Minimum
Assessment Agreement and agrees to be bound thereby.
By:
Name
Title
STATE OF
COUNTY OF
ss
On this day of 2008, before me, the
undersigned a Notary Public in and for said County and State, personally appeared
to me personally known, who being by me duly sworn,
did say that the person is the of
,executing the within and foregoing instrument; that
said instrument was signed on behalf of said corporation by authority of the
corporation; and that the said as such officer
acknowledged the execution of said instrument to be the voluntary act and deed of
said corporation by it voluntarily executed.
Notary Public
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CERTIFICATION OF ASSESSOR
The undersigned, having reviewed the plans and specifications for the
Minimum Improvements constructed and the market value assigned to the land
upon which the Minimum Improvements were constructed, and being of the opinion
that the minimum market value contained in the foregoing Minimum Assessment
Agreement appears reasonable, hereby certifies as follows: The undersigned
Assessor, being legally responsible for the assessment of the property described in
the foregoing Minimum Assessment Agreement, and in accordance with the
Minimum Assessment Agreement, certifies that the actual value assigned to such
land and improvements shall not be less than One Million and no/100 Dollars
($1,000,000.00) until termination of this Minimum Assessment Agreement pursuant
to the terms hereof.
City Assessor for the City of Dubuque, Iowa
Date
STATE OF IOWA )
SS
COUNTY OF DUBUQUE )
Subscribed and sworn to before me by Richard Engelken, City Assessor for
the City of Dubuque, Iowa.
Notary Public in and for the State of Iowa
Date
35
EXHIBIT E
MEMORANDUM OF DEVELOPMENT AGREEMENT
36
Prepared by: Barry A. Lindahl 300 Main Street Suite 330 Dubuque IA 52001 563 583-4113
Return to: Barry A. Lindahl 300 Main Street Suite 330 Dubuque IA 52001 563 583-4113
MEMORANDUM OF DEVELOPMENT AGREEMENT
A Development Agreement by and among the City of Dubuque, Iowa, an
Iowa municipal corporation, of Dubuque, Iowa, and
was made regarding the following described premises:
The Development Agreement is dated for reference purposes the day
of , 20_, and contains covenants, conditions, and restrictions
concerning the sale and use of said premises.
This Memorandum of Development Agreement is recorded for the purpose
of constructive notice. In the event of any conflict between the provisions of this
Memorandum and the Development Agreement itself, executed by the parties, the
terms and provisions of the Development Agreement shall prevail. A complete
counterpart of the Development Agreement, together with any amendments
thereto, is in the possession of the City of Dubuque and may be examined at its
offices as above provided.
Dated this day of , 20_
CITY OF DUBUQUE, IOWA
By:
Roy D. Buol, Mayor
37
By:
Jeanne F. Schneider, City Clerk
STATE OF IOWA
DUBUQUE COUNTY
ss:
On this day of , 20_, before me, a Notary Public in and for the
State of Iowa, in and for said county, personally appeared Roy D. Buol and Jeanne
F. Schneider, to me personally known, who being by me duly sworn did say that
they are the Mayor and City Clerk, respectively of the City of Dubuque, a Municipal
Corporation, created and existing under the laws of the State of Iowa, and that the
seal affixed to said instrument is the seal of said Municipal Corporation and that
said instrument was signed and sealed on behalf of said Municipal corporation by
authority and resolution of its City Council and said Mayor and City Clerk
acknowledged said instrument to be the free act and deed of said Municipal
Corporation by it voluntarily executed.
Notary Public, State of Iowa
STATE OF IOWA
DUBUQUE COUNTY
ss:
On this day of , 20)), before me, a Notary Public in and for
the State of Iowa, in and for said county, personally appeared
to me personally known, who being by me duly sworn did say that they are
the
and that said instrument was signed on behalf of said company by authority
of its members and that they acknowledged the execution of this instrument
to be the voluntary act and deed of said company by it voluntarily executed.
38
Notary Public, State of Iowa
39