Flexsteel Industries, Inc._Redevelopment Agreement, DA, Offer to Buy, Setting Hearings Copyrighted
May 15, 2017
City of Dubuque Action Items # 1.
ITEM TITLE: Flexsteel Industries, Inc.
SUMMARY: City Manager recommending Council approval of the
Redevelopment Project Agreement between Flexsteel
Industries, Inc., Dubuque Initiatives and the City of
Dubuque; and approval of resolutions setting a public
hearing for June 5, 2017, to consider the Development
Agreement between Flexsteel Industries, Inc. and the City
of Dubuque, and the Offer to Buy and Acceptance between
Dubuque County and the City of Dubuque.
Press Release from Greater Dubuque Development
Corporation
Redevelopment Project Agreement
RESOLUTION Approving a Redevelopment Project
Agreement by and among the City of Dubuque, Iowa,
Dubuque Initiatives, and Flexsteel Industries, Inc.
Suggested Disposition: Receive and File; Adopt
Resolution(s)
Development Agreement
RESOLUTION of Intent to approve a Development
Agreement between the City of Dubuque and Flexsteel
Industries, Inc. and fixing the date for a public hearing of
the City Council of the City Of Dubuque, Iowa on the
proposed issuance of Urban Renewal Tax Increment
Revenue Grant Obligations and providing for the publication
of notice thereof
Offer to Buy and Acceptance
RESOLUTION of Intent to dispose of an interest in City of
Dubuque real estate pursuant to an offer to buy and
acceptance between the City of Dubuque and Dubuque
County, Iowa and fixing the date for a public hearing and
providing for the publication of notice thereof
Suggested Disposition: Receive and File; Adopt
Resolution(s), Set Public Hearing for June 5, 2017
SUGGESTED DISPOSITION:
ATTACHMENTS:
Description Type
Flexsteel - MVM Memo City Manager Memo
Redevelopment Project Agreement City-Dl-Flexsteel Supporting Documentation
Resolution - Redevelopment Project Agreement Resolutions
DevelopmentAgrement Supporting Documentation
Resolution - Development Agreement Resolutions
Offer to Purchase- City-County Supporting Documentation
Resolution - Offer to Purchase Resolutions
GDDC Press Release Supporting Documentation
Citizen Petition Supporting Documentation
THE CM OF Dub
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TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Flexsteel Industries, Inc.
DATE: May 12, 2017
In September 2016, representatives of Flexsteel Industries, Inc. announced their intent
to close their facility at 3400 Jackson Street in Dubuque, much of which was built in
1897, because it was inefficient and costly to maintain. At that time, Flexsteel
expressed a desire to stay in Dubuque. Flexsteel has called Dubuque home since
1936.
The City of Dubuque, Dubuque County, Dubuque Initiatives, Northeast Iowa Community
College, Iowa Economic Development Authority and Greater Dubuque Development
Corporation have been working with Flexsteel in an effort to develop a financing
package that allows the company to operate competitively in Dubuque Industrial Center
South on Seippel Road and to achieve the eventual redevelopment of the company's
existing site at 3400 Jackson Street.
I am pleased to say that after nine months of concerted effort by all parties involved, a
successful conclusion has been reached. A major reason this was possible was the
successful collective bargaining agreement negotiation Flexsteel conducted with the
company's three unions, including United Steelworkers Local 1861, Teamsters Local
120 and Operating Engineers Local 234. Once that was accomplished, Flexsteel
entered intense negotiations with the City of Dubuque, Dubuque County and Dubuque
Initiatives, with participation by Greater Dubuque Development Corporation. On
December 2, 2016 correspondence from the United Steelworkers Local 1861, the union
representing most of the workers at Flexsteel, advised that union membership had
ratified an agreement on November 30, 2016. In that letter union representatives
stated, "We are now asking you as the Leaders of Dubuque to work with Flexsteel in
any manner possible within your control to help or aid Flexsteel so they will build the
new facility here to preserve our jobs so we can continue to support our families and the
Dubuque community." The City received a petition with over 300 signatures with a
similar request, which was placed on the March 6, 2017 City Council Agenda.
In my discussions with union representatives, they have always been aware that this
would be a job retention project and not a job creation project. In fact, all parties have
been aware that the goal of Flexsteel was to become more efficient and, therefore,
more competitive in the marketplace, and that these efficiencies would actually lead to
some near-term job reductions. The commitment is to retain a minimum of 200
positions at the Dubuque Industrial Center South facility for the term of the Development
Agreement between the City of Dubuque and Flexsteel.
In the Development Agreement with the City of Dubuque and the Redevelopment
Project Agreement with the City and Dubuque Initiatives, Flexsteel is committing to:
1 . Retaining a minimum of 200 positions.
2. Purchasing 22 useable acres in Dubuque Industrial Center South.
3. Constructing a facility of not less than 250,000 sq. ft. at an estimated cost of$25
million, including machinery and equipment.
4. Construction is anticipated to commence on or before August 1 , 2017.
5. Construction will be substantially completed by September 1 , 2018.
6. Donating the former company facility and the approximate 43 acres at 3400
Jackson Street to Dubuque Initiatives.
7. Funding an escrow account with not less than $2,660,000, which will be used by
Dubuque Initiatives for demolition costs and environmental remediation costs,
related to the structures at the Jackson Street site.
8. Agreeing to hold harmless and indemnify Dubuque Initiatives and the City of
Dubuque from any environmental remediation costs, such as soil and water.
9. Dubuque County is not a party to the Development Agreement or the Jackson
Street Redevelopment Project Agreement.
In the Redevelopment Project Agreement, Dubuque Initiatives is committing to:
1 . Accepting ownership of the 43-acre site at 3400 Jackson Street.
2. Demolishing all structures and conducting remediation of the structures, for
instance, asbestos removal. It is the intent of the parties that demolition of
structures by Dubuque Initiatives will begin as soon as possible after the transfer
of title to the property from Flexsteel to Dubuque Initiatives.
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3. Capping Flexsteel's liability for demolition and environmental remediation for the
structures on the Jackson Street site at $2,660,000. Environmental remediation,
if required for soil and water, will be conducted by Flexsteel to conform the site to
current light industrial use standards.
4. Applying for federal and state grants to assist with the funding of environmental
remediation of the Jackson Street site in an effort to minimize the exposure to
Flexsteel, Dubuque Initiatives, Dubuque County and the City of Dubuque.
5. Marketing the site for light industrial redevelopment, with the net proceeds from
any sale going 50% to Dubuque County, 17% to the City of Dubuque and the
remainder to Dubuque Initiatives.
Dubuque County is committing to:
1 . Purchasing the following two parcels from the City of Dubuque:
a. 22 useable acres in Dubuque Industrial Center South
b. 3.8 useable acres in Dubuque Industrial Center West
for the purchase price of$3,320,000 as follows:
$1 ,320,000 at the time of closing
$300,000 on July 1 , 2018
$300,000 on July 1 , 2019
$300,000 on July 1 , 2020
$300,000 on July 1 , 2021
$300,000 on July 1 , 2022
$300,000 on July 1 , 2023
$200,000 on July 1 , 2024
2. The 22-acre parcel will be sold by Dubuque County to a Flexsteel-affiliated
organization facilitating 1031 Like-Kind exchange with a subsequent sale to
Flexsteel, so Flexsteel can build its facility and perform its requirements under
the Development Agreement with the City of Dubuque.
3. The 3.8-acre parcel will be retained by Dubuque County for use as a site for
future Dubuque County facilities or as an economic development parcel.
The Iowa Economic Development Authority will consider at the May 19, 2017 Iowa
Economic Development Authority Board Meeting:
1 . Providing a $1 million forgivable loan for the demolition and environmental
remediation of 3400 Jackson Street.
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2. Providing an Investment Tax Credit estimated at $293,200.
3. Providing a Sales, Services and Use Tax Refund estimated at $750,000.
Northeast Iowa Community College is committing to:
• Workforce Training and Economic Development funding for training existing
employees, valued at $100,000.
The City of Dubuque is committing to:
1 . Selling two parcels of property totaling 25.8 acres to Dubuque County for a total
purchase price of$3,320,000.
• One parcel is 22 useable acres in Dubuque Industrial Center South valued at
$2,640,000 for Dubuque County to resell the property to Flexsteel for
$1 ,320,000.
• The other parcel is 3.8 useable acres in Dubuque Industrial Center West
valued at $456,000 that Dubuque County can use for future Dubuque County
facilities or as a future economic development parcel.
2. While the City will retain $660,000 of the $3,320,000 sale price, $660,000 will be
deposited into an Escrow Fund for use by Dubuque Initiatives in demolition of the
buildings at the current Flexsteel site, 3400 Jackson Street. The additional
$2,000,000 of the sales price will be paid by Dubuque County to the City over a
seven-year period and deposited by the City into the Escrow Fund.
3. Foregoing any return above $660,000 (and the 17% the City receives of the
eventual sale by Dubuque Initiatives of the 3400 Jackson Street site) for the
actual $120,000 an acre value of the 25.88 acres valued at $3,096,000.
4. Providing Flexsteel 10 years of Tax Increment Financing rebates for property
taxes paid on the new facilities in Dubuque Industrial Center South, with an
estimated value of$4.1 million in rebates.
5. Providing 10 years of Tax Increment Financing rebates for property taxes paid on
any new development on the 3400 Jackson Street site to help Dubuque
Initiatives market the site and to ensure Dubuque Initiatives gets full
reimbursement for any unreimbursed costs Dubuque Initiatives incurs
redeveloping the site.
The value of the incentive package put together for Flexsteel is as follows:
• Dubuque Initiatives — All expenses incurred would be reimbursed through the two
Escrow Accounts established with funding from Flexsteel, Dubuque County, Iowa
Economic Development Authority and the City of Dubuque.
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Dubuque Initiatives will take ownership of the existing Flexsteel site at 3400
Jackson Street to:
a. Manage the demolition, environmental clean-up and marketing of the site
for redevelopment.
b. Apply for some environmental clean-up grant programs that are not
available to a private business like Flexsteel.
c. Insulate Dubuque County and the City of Dubuque from potential
environmental liability.
• Northeast Iowa Community College - $100,000
• Iowa Economic Development Authority - $2,043,200
• Dubuque County - Maximum financial contribution of$1 ,534,400 over seven
years is set forth as follows
a. Dubuque County will pay $3,320,000 for the City property, $1 ,320,000
reimbursed by Flexsteel from the sale of the property to Flexsteel.
b. Dubuque County will receive 3.88 acres of property in Dubuque Industrial
Center West for possible future Dubuque County facilities or a future
economic development project, valued at $465,600.
c. Dubuque County's contribution will be reduced if demolition costs at 3400
Jackson Street are less than anticipated, if federal or state grants are
received for demolition, and 50% of the net proceeds of the sale of the
3400 Jackson Street site sale.
• City of Dubuque - $6,545,600
a. $660,000 from the sale of 25.88 acres of industrial park property to
Dubuque County valued at $3,105,600 (the remainder of the sale
proceeds from Dubuque County will be dedicated to demolition and
environmental remediation related to the buildings on Jackson Street), and
16% of the ultimate sale of the Jackson Street property - $2,445,600.
b. Ten years of Tax Increment Financing Rebates to Flexsteel estimated at
$4.1 million.
Total Incentive Package - $10,223,200
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Possible sources of funding that will be pursued for demolition and environmental
remediation, other than the $6,320,000 identified in the agreements, includes (and
others will most certainly be identified as the process progresses):
1 . U.S. Environmental Protection Agency (EPA) Competitive Brownfields Revolving
Loan Fund - $800,000;
2. U.S. EPA Competitive Brownfields Clean-Up Grants - $200,000 (there is the
possibility of multiple grants over the years); and
3. Iowa Economic Development Authority Competitive Brownfield/Grayfield Tax
Credit - $1 ,000,000.
Current estimates for the demolition ($4,750,000) and environmental remediation
($670,000) related to the buildings and parking lot surfaces at the Jackson Street
property is $5,420,000. The agreements provide $5,820,000 for that purpose, plus an
IEDA loan of$500,000 to assist Flexsteel with environmental remediation. The intent is
to apply for other federal and state grant programs to minimize the amount of local
contribution required.
I want to thank everyone who worked so hard to keep Flexsteel Industries, Inc.'s
manufacturing operation in Dubuque and to save these 200 jobs.
I respectfully recommend Mayor and City Council approval of the Redevelopment
Project Agreement between Flexsteel Industries, Inc., Dubuque Initiatives and the City
of Dubuque, and approval of resolutions setting a public hearing for June 5, 2017, to
consider the Development Agreement between Flexsteel Industries, Inc. and the City of
Dubuque, and the Offer to Buy and Acceptance between Dubuque County and the City
of Dubuque.
Mic ael C. Van Milligen
MCVM:jh
Attachment
cc: Tim Hall, Flexsteel SVP Finance, CFO & Secretary
Hilary Stubben, Flexsteel In-House Corporate Counsel
Jay Wickham, Chair, Dubuque County Board of Supervisors
Ralph Potter, Dubuque County Attorney
Doug Horstmann, Chair, Dubuque Initiatives Board of Directors
Flint Drake, Attorney, Drake Law Firm — Representing Dubuque Initiatives
Rick Dickinson, Greater Dubuque Development Corp. President & CEO
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Dan McDonald, Greater Dubuque Development Corp.
Vice President of Existing Business
David Lyons, LDDC, Sustainable Innovation Consultant
Crenna Brumwell, City Attorney
Barry Lindahl, Senior Counsel
Cindy Steinhauser, Assistant City Manager
Teri Goodmann, Assistant City Manager
Maurice Jones, Economic Development Director
Jill Connors, Economic Development Project Coordinator
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Prepared by: Barry A. Lindahl, Esq. 300 Main Street Suite 330 Dubuque IA 52001 (563) 583-4113
Return to: Barry A. Lindahl, Esq. 300 Main Street Suite 330 Dubuque IA 52001
RESOLUTION NO. 180-17
APPROVING A REDEVELOPMENT PROJECT AGREEMENT BY AND AMONG THE
CITY OF DUBUQUE, IOWA, DUBUQUE INITIATIVES, AND FLEXSTEEL
INDUSTRIES, INC.
WHEREAS, City of Dubuque, Iowa, a municipality (City), established pursuant to
the Iowa Code and acting under authorization of Iowa Code Chapter 403, as amended
(Urban Renewal Act), Dubuque Initiatives, an Iowa not for profit corporation (Initiatives),
and Flexsteel Industries, Inc., a Minnesota corporation, with its principal place of business
in Dubuque, Iowa (Flexsteel), have tentatively entered into a Redevelopment Project
Agreement regarding the redevelopment of a certain tract of land located in the City and
County of Dubuque, a copy of which Redevelopment Project Agreement is on file at the
Office of the City Clerk; and
WHEREAS, the tract of land is more particularly described as follows (hereinafter
"the Property"): Tax Parcel Numbers:
• 1011426003 (30.00 acres);
• 1011426004 (8.36 acres);
n4o4r14(1/14 in'lc �.
• 1 V 1 J 1 V 1 V V 1 `V.40 alar eS�,
• 1011427004 (0.83 acres); and
• 1014230001 (3.73 acres) excluding a parcel of real estate at the Southwest
corner of Flexsteel's parking lot located at the Northeast corner of 32nd and
Jackson Streets, Dubuque, Iowa, consisting of approximately 35,680
square feet and having a street address of 3250 Jackson Street (American
Trust branch);
; and
WHEREAS, Property was most recently used as an industrial facility by Flexsteel
which has entered into a Development Agreement with City to build a new industrial
facility and retain employment in the City and County of Dubuque;
050917ba1
WHEREAS, Flexsteel desires to donate the Property to Initiatives, a not for profit
community development organization; and
WHEREAS, the parties believe that the redevelopment and utilization of the
Property pursuant to the Redevelopment Project Agreement, and the fulfillment generally
of the Redevelopment Project Agreement, are in the vital and best interests of the citizens
of the City and County of Dubuque and in accord with the public purposes and provisions
of the applicable federal, state and local laws and the requirements under which the
Redevelopment Project Agreement is undertaken and is being assisted; and
WHEREAS, the parties have determined that the Redevelopment Project
Agreement will remove a potential source of brownfield and blight concerns on the
community's north -side and be transformational in scope by providing for the expansion
of desirable uses both within the urban core of the community and into the surrounding
county; and
WHEREAS, the City Council believes that the development of the Property
pursuant to the Redevelopment Project Agreement, and the fulfillment generally of the
Redevelopment Project 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
WHEREAS, it is the determination of the City Council that approval of the
Redevelopment Project Agreement according to the terms and conditions set out in the
Redevelopment Project Agreement is in the public interest of the City of Dubuque.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF DUBUQUE, IOWA:
Section 1. That the Redevelopment Project Agreement by and among the City
of Dubuque, Dubuque Initiatives, and Flexsteel Industries, Inc. is hereby approved.
Section 2. That the Mayor is hereby authorized and directed to execute the
Redevelopment Project Agreement on behalf of the City of Dubuque and the City Clerk
is a:.,°thori`ed and directed to attest to his signature.
Section 3. That the City Manager is authorized to take such actions as are
necessary to comply with the terms of the Redevelopment Project Agreement as herein
approved.
Attest:
Passed, approved and adopted this 15th day of May, 2017.
/KevCh Firnstahl,Uity Clerk
2
Roy D. Biot, Mayor
Prepared by: Barry A. Lindahl, Esq. 300 Main Street Suite 330 Dubuque IA 52001 (563) 583-4113
Return to: Barry A. Lindahl, Esq. 300 Main Street Suite 330 Dubuque IA 52001
RESOLUTION NO. 181-17
INTENT TO APPROVE A DEVELOPMENT AGREEMENT BETWEEN THE CITY OF
DUBUQUE AND FLEXSTEEL INDUSTRIES, INC. AND FIXING THE DATE FOR A
PUBLIC HEARING OF THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA ON
THE PROPOSED ISSUANCE OF URBAN RENEWAL TAX INCREMENT REVENUE
GRANT OBLIGATIONS AND PROVIDING FOR THE PUBLICATION OF NOTICE
THEREOF
Whereas, the City of Dubuque, Iowa (City) is the owner of the following real
property (the Property);
Lot 4 of Dubuque Industrial Center South First Addition in the City of
Dubuque, Iowa
; and
Whereas, City and Flexsteel Industries, Inc. (Flexsteel) have entered into a
Development Agreement, subject to the approval of the City Council, pursuant to which
Flexsteel will construct on the Property certain Improvements described in the Development
Agreement; and
Whereas, the City Council has tentatively determined that it would be in the best
interests of City to approve the Development Agreement; and
Whereas, the Development Agreement provides for the issuance by City of
economic development grants to Flexsteel, referred to therein as the Economic
Development Grants, payable from the tax increment revenues collected in respect of the
Improvements to be constructed by Flexsteel in accordance with the Development
Agreement, for the purpose of carrying out the objectives of an Urban Renewal Plan as
hereinafter described; and
Whereas, before said obligations may be approved, Chapter 403 of the Code of
051117ba1
Iowa requires that the City Clerk publish a notice of the proposal and of the time and place
of the meeting at which the City Council proposes to take action thereon and at which
meeting the City Council shall receive oral and/or written objections from any resident or
property owner of said City to such proposed action.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF DUBUQUE, IOWA:
Section 1. The City of Dubuque intends to approve the proposed Development
Agreement with Flexsteel.
Section 2. The City Clerk is hereby authorized and directed to cause a notice to
be published as prescribed by Iowa Code Section 403.9 of a public hearing to be held on
the 5th day of June, 2017 at 6:00 p.m. in the City Council Chambers at the Historic Federal
Building, 350 W. 6th Street, Dubuque, Iowa.
Section 3. The City Council will meet at said time and place for the purpose of
taking action on the matter of authorizing the execution of the Development Agreement with
Flexsteel, pursuant to and in accordance with the Urban Renewal Ran for the Dubuque
Industrial Center Economic Development District, including but not limited to the funding of
Economic Development Grants to Flexsteel under the terms and conditions of the
Development Agreement and said Urban Renewal Plan. It is expected that the aggregate
amount of the Economic Development Grants will not exceed $4,100,000.
Section 4. The City Clerk is hereby directed to cause at least one publication to
be made of a notice of said meeting, in a newspaper, printed wholly in the English
language, published at least once weekly, and having general circulation in said City, said
publication to be not less than four days nor more than twenty days before the date of
said meeting on the issuance of said obligations.
Section 5. That the notice of the proposed action shall be in substantially the
form attached hereto.
Passed, approved and adopted this 15th day of Il4ay, 2017.
Attest:
Keen FirnstaFil, City Clerk
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I�oy�1BuoI, Mayor
Prepared by: Barry A. Lindahl, Esq. 300 Main Street Suite 330 Dubuque IA 52001 (563) 583-4113
Return to: Barry A. Lindahl, Esq. 300 Main Street Suite 330 Dubuque IA 52001
RESOLUTION NO. 182-17
INTENT TO DISPOSE OF AN INTEREST IN CITY OF DUBUQUE REAL ESTATE
PURSUANT TO AN OFFER TO BUY AND ACCEPTANCE BETWEEN THE CITY OF
DUBUQUE AND DUBUQUE COUNTY, IOWA AND FIXING THE DATE FOR A PUBLIC
HEARING AND PROVIDING FOR THE PUBLICATION OF NOTICE THEREOF
Whereas, the City of Dubuque, Iowa (City) is the owner of the following real
property (the Property);
Lot 4 of Dubuque Industrial Center South First Addition in the City of
Dubuque, Iowa
and
A parcel of land of 3.88 acres more or less on Seippel Road in the Dubuque
Industrial Center West Urban Renewal District of the City of Dubuque, as
shown on Exhibit A attached hereto, subject to survey and platting the cost
of which will be paid by Buyer
; and
Whereas, City and Dubuque County, Iowa (County) have entered into an Offer to
Buy and Acceptance (the Agreement), subject to the approval of the City Council,
pursuant to which City will convey the Property to County; County will convey Lot 4 of
Dubuque Industrial Center South First Addition in the City of Dubuque, Iowa to Flexsteel
Industries, Inc. or an affiliate of Flexsteel Industries, Inc. (Flexsteel), and Flexsteel will
construct on Lot 4 of Dubuque Industrial Center South First Addition in the City of Dubuque,
Iowa certain Improvements for a manufacturing facility described in a Development
Agreement between the City of Dubuque, Iowa and Flexsteel; and
Whereas, the City Council has tentatively determined that it would be in the best
interests of City to approve the Agreement for sale of the Property to County; and
051017baI
Whereas, the Code of Iowa requires that the City Clerk publish a notice of the
proposal and of the time and place of the meeting at which the City Council proposes to
take action thereon and at which meeting the City Council shall receive oral and/or written
objections from any resident or property owner of said City to such proposed action.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF DUBUQUE, IOWA:
Section 1. The City of Dubuque intends to dispose of its interest in the
foregoing -described Property by Deed to Dubuque County, Iowa pursuant to the
proposed Agreement.
Section 2. The City Clerk is hereby authorized and directed to cause a notice to
be published as prescribed by Iowa Code Section 3641 of a public hearing on the City's
intent to dispose of the foregoing -described Property, to be held on the 5th day of June,
2017, at 6:00 p.m. in the City Council Chambers at the Historic Federal Building, 350 W. 6th
Street, Dubuque, Iowa.
Section 3. The City Clerk is hereby directed to cause at least one publication to
be made of a notice of said meeting, in a newspaper, printed wholly in the English
language, published at least once weekly, and having general circulation in said City, said
publication to be not Tess than four days nor more than twenty days before the date of
said meeting on the disposal of the City's interest in the Property.
Section 4. That the notice of the proposed action shall be in substantially the
form attached hereto.
Passed, approved and adopted this 15th day of May, 2017.
Attest:
K n S. irnstafil, City Clerk
2
i9
Roy Duol, Mayor
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1
CITY OF DUBUQUE, IOWA
OFFICIAL NOTICE
NOTICE OF A PUBLIC HEARING OF THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA, ON THE INTENT TO DISPOSE OF AN INTEREST IN CITY OF
DUBUQUE REAL ESTATE PURSUANT TO AN OFFER TO BUY AND ACCEPTANCE
BETWEEN THE CITY OF DUBUQUE AND DUBUQUE COUNTY, IOWA
PUBLIC NOTICE is hereby given that the City Council of the City of Dubuque, Iowa, will
hold a public hearing on the 5th day of June, 2017, at 6:00 p.m. in the City Council
Chambers at the Historic Federal Building, 350 W. 6th St., Dubuque, Iowa, at which
meeting the City Council proposes to take action on the intent to dispose of an interest in
City of Dubuque real estate, described as
Lot 4 of Dubuque Industrial Center South First Addition in the City of Dubuque, Iowa
;and
A parcel of land of 3.88 acres more or less on Seippel Road in the Dubuque Industrial Center
West Urban Renewal District of the City of Dubuque, as shown on Exhibit A attached hereto,
subject to survey and platting the cost of which will be paid by Buyer pursuant to an Offer to
Buy and Acceptance (the Agreement) between the City of Dubuque and Dubuque County,
Iowa.
Under the Agreement, Dubuque County will convey Lot 4 of Dubuque Industrial Center
South First Addition in the City of Dubuque, Iowa to Flexsteel Industries, Inc. or an affiliate
of Flexsteel Industries, Inc. (Flexsteel) and Flexsteel will construct on Lot 4 of Dubuque
Industrial Center South First Addition in the City of Dubuque, Iowa certain Improvements
for a manufacturing facility described in a Development Agreement between the City of
Dubuque, Iowa and Flexsteel Industries, Inc.
At the meeting, the City Council will receive oral and written objections from any resident
or property owner of said City to the above action. After all objections have been received
and considered, the City Council may at this meeting or at any adjournment thereof,
approve the sale of the above-described Property to Dubuque County.
Any visual or hearing impaired persons needing special assistance or persons with
special accessibility needs should contact the City Clerk’s Office at (563) 589-4100 or
TTY (563) 690-6678 at least 48 hours prior to the meeting.
Dated this 24th day of May, 2017.
Kevin S. Firnstahl
City Clerk of Dubuque, Iowa
RESOLUTION NO. 182-17
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INTENT TO DISPOSE OF AN INTEREST IN CITY OF DUBUQUE REAL ESTATE
PURSUANT TO AN OFFER TO BUY AND ACCEPTANCE BETWEEN THE CITY OF
DUBUQUE AND DUBUQUE COUNTY, IOWA AND FIXING THE DATE FOR A PUBLIC
HEARING AND PROVIDING FOR THE PUBLICATION OF NOTICE THEREOF
Whereas, the City of Dubuque, Iowa (City) is the owner of the following real property (the
Property);
Lot 4 of Dubuque Industrial Center South First Addition in the City of Dubuque,
Iowa
and
A parcel of land of 3.88 acres more or less on Seippel Road in the Dubuque
Industrial Center West Urban Renewal District of the City of Dubuque, as shown
on Exhibit A attached hereto, subject to survey and platting the cost of which will
be paid by Buyer
; and
Whereas, City and Dubuque County, Iowa (County) have entered into an Offer to Buy
and Acceptance (the Agreement), subject to the approval of the City Council, pursuant to
which City will convey the Property to County; County will convey Lot 4 of Dubuque
Industrial Center South First Addition in the City of Dubuque, Iowa to Flexsteel Industries,
Inc. or an affiliate of Flexsteel Industries, Inc. (Flexsteel), and Flexsteel will construct on Lot
4 of Dubuque Industrial Center South First Addition in the City of Dubuque, Iowa certain
Improvements for a manufacturing facility described in a Development Agreement between
the City of Dubuque, Iowa and Flexsteel; and
Whereas, the City Council has tentatively determined that it would be in the best interests
of City to approve the Agreement for sale of the Property to County; and
Whereas, the Code of Iowa requires that the City Clerk publish a notice of the proposal
and of the time and place of the meeting at which the City Council proposes to take action
thereon and at which meeting the City Council shall receive oral and/or written objections
from any resident or property owner of said City to such proposed action.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. The City of Dubuque intends to dispose of its interest in the foregoing-
described Property by Deed to Dubuque County, Iowa pursuant to the proposed
Agreement.
Section 2. The City Clerk is hereby authorized and directed to cause a notice to be published
as prescribed by Iowa Code Section 364.7 of a public hearing on the City’s intent to dispose
3
of the foregoing-described Property, to be held on the 5th day of June, 2017, at 6:00 p.m. in
the City Council Chambers at the Historic Federal Building, 350 W. 6th Street, Dubuque,
Iowa.
Section 3. The City Clerk is hereby directed to cause at least one publication to be made
of a notice of said meeting, in a newspaper, printed wholly in the English language,
published at least once weekly, and having general circulation in said City, said
publication to be not less than four days nor more than twenty days before the date of
said meeting on the disposal of the City’s interest in the Property.
Section 4. That the notice of the proposed action shall be in substantially the form
attached hereto.
Passed, approved and adopted this 15th day of May, 2017.
Roy D. Buol, Mayor
Attest: Kevin S. Firnstahl, City Clerk
1t 5/19
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1
1
REDEVELOPMENT PROJECT AGREEMENT
BY AND AMONG
THE CITY OF DUBUQUE, IOWA,
DUBUQUE INITIATIVES,
AND
FLEXSTEEL INDUSTRIES, INC.
THIS REDEVELOPMEI T PROJECT AGREEMENT ("this Agreement"), dated
for reference purposes the/ /day of j ' , 2017, by and among the City
of Dubuque, Iowa, a municipality (City), est, •fished pursuant to the Iowa Code and
acting under authorization of Iowa Code Chapter 403, as amended (Urban Renewal
Act), Dubuque Initiatives, an Iowa not for profit corporation (Initiatives), and Flexsteel
Industries, Inc., a Minnesota corporation, with its principal place of business in
Dubuque, Iowa (Flexsteel).
WITNESSETH:
WHEREAS, the parties desire to formalize their understanding regarding the
redevelopment of a certain tract of land located in the City and County of Dubuque;
WHEREAS, the tract of land is more particularly described as follows (hereinafter
"the Property"): Tax Parcel Numbers:
• 1011426003 (30.00 acres);
• 1011426004 (8.36 acres);
• 1013101001 (0.26 acres);
• 1011427004 (0.83 acres); and
• 1014230001 (3/3 acres) excluding a parcel of real estate at the
Southwest corner of Flexsteel's parking lot located at the Northeast corner
of 32nd and Jackson Streets, Dubuque, Iowa, consisting of approximately
35,680 square feet and having a street address of 3250 Jackson Street
(American Trust branch).
(Complete legal description to be provided pursuant to abstract of title)
WHEREAS, Property was most recently used as an industrial facility by Flexsteel
who has entered into a Development Agreement to build a new industrial facility and
retain employment in the City and County of Dubuque;
WHEREAS, Flexsteel desires to donate the Property to Initiatives, a not for profit
community development organization;
WHEREAS, the parties believe that the redevelopment and utilization of the
Property pursuant to this Agreement, and the fulfillment generally of this Agreement, are
in the vital and best interests of the citizens of the City and County of Dubuque and in
accord with the public purposes and provisions of the applicable federal, state and local
laws and the requirements under which this Agreement is undertaken and is being
Redevelopment Agreement CityDlFlexsteel 051117bal
assisted;
WHEREAS, the parties have determined that this Agreement will remove a
potential source of brownfield and blight concerns on the community's north -side and be
transformational in scope by providing for the expansion of desirable uses both within
the urban core of the community and into the surrounding county;
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. POSSESSION OF THE PROPERTY.
1.1 Flexsteel shall promptly provide Initiatives with a copy of all environmental
consulting or engineering reports, separate laboratory analysis reports, and other
material information and data received by Flexsteel regarding the environmental
condition of the Property, or which are otherwise received or generated pursuant to this
Agreement.
1.2 It is agreed that Flexsteel will donate the Property to Initiatives. It is agreed that
upon completion of all appropriate inquiry and a mutually agreed upon Property
transition plan, and upon vacation of the Property by Flexsteel, Initiatives will accept title
to and possession of the Property and will be the owner of the Property. In no event,
shall the period of time between Flexsteel's total' vacation from the Property and
acceptance of title and possession of the Property by Initiatives exceed forty-five (45)
days. Provided, however, the transfer shall not occur earlier than six (6) months from
the date hereof to allow Initiatives to review the environmental aspects of the property
and obtain bids or proposals for the work required to be completed hereunder. Nothing
in this Agreement creates any ownership right or responsibility for the other parties, nor
do such parties accept any ownership right or responsibility. Initiatives shall control the
daily management and decisions regarding the redevelopment of the Property, but the
final sale or disposition of all or any portion of the Property shall require consent of all
parties.
1.3 Upon receipt of written notice from Initiatives accepting the donation, Flexsteel, at
its expense, shall promptly obtain an abstract of title to the Property continued through the
date of notice of acceptance which shall show merchantable title held by Flexsteel in
conformity with Iowa law and Title Standards of the Iowa State Bar Association. Flexsteel
shall make every reasonable effort to promptly perfect title. If closing is delayed due to
Flexsteel's inability to provide marketable title, this Agreement shall continue in force and
effect until either party rescinds this Agreement after giving ten (10) days written notice to
the other party. At the closing, the abstract shall become the property of Initiatives.
Flexsteel shall pay the costs of any additional abstracting and title work due to any act or
omission of Flexsteel, including transfers by Flexsteel or its assignees. At the closing,
Flexsteel shall convey the Property to Initiatives by Warranty Deed, free and clear of all
liens, restrictions, and encumbrances. General warranties of the title shall extend to the
2
time of delivery of the deed excepting liens and encumbrances suffered or permitted by
Initiatives. The warranty deed shall contain a covenant providing that the Property may
not be used for any use less intense than the Light Industrial zoning designation under
City's applicable zoning ordinances unless the proposed owner or user of the Property
agrees to pay any and all costs incurred due to the less intense use, including but not
limited to, any additional Environmental Remediation Costs.
1.4 City will not, and Flexsteel will not after conveyance of the Property to Initiatives,
under any circumstances accept ownership of the Property.
SECTION 2. FUNDING OF DEMOLITION AND REMEDIATION OF THE
PROPERTY.
2.1 From funds received by City from Dubuque County, Iowa (the "County") from the
sale of property in Dubuque Industrial Center South First Addition (the "Development
Property"), upon receipt of $1,320,000 City shall contribute $660,000 to an escrow
agent mutually agreed to by the parties (the "City Escrow Agent"), to be held in escrow
(the "City Escrow") for a period of 10 years or until the City Escrow funds are fully
expended pursuant to the terms of this Agreement.
2.2 From additional funds received by City from the County from the sale of the
Development Property in the amount of and upon receipt of $300,000 per year from the
County, City shall contribute $300,000 a year for a period of six (6) years to the City
Escrow and a final payment in the seventh year of $200,000. The City payment shall
commence on or before July 1, 2018, and shall continue on the 1st day of July of each
year thereafter until the total of such payments is $2,000,000; provided, however, as
follows:
A. In the event that the Property is sold prior to the payment by City of all
such funds to the City Escrow, after payment by and reimbursement of Initiatives
from the City Escrow of all Reimbursable Expenses and Costs and Recurring
Expenses, City may discontinue such payments to the City Escrow.
B. In the event that all structures are properly demolished, as determined by
agreement of Initiatives and City, and prior to the payment by City of all such
funds to the City Escrow, City shall be required to pay to the City Escrow only
such funds as are necessary for payment by and reimbursement of Initiatives
from the City Escrow of all Reimbursable Expenses and Costs and Recurring
Expenses, pursuant to statements provided by Initiatives to City.
C. In the event prior to the payment by City of all such funds to the City
Escrow, sufficient funds are received from grants or funds from sources other
than the parties to this Agreement or Dubuque County for Demolition Costs, City
shall be required to pay to the City Escrow only such funds as are necessary for
payment by and reimbursement of Initiatives from the City Escrow of all
Reimbursable Expenses and Costs and Recurring Expenses, pursuant to
3
statements provided by Initiatives to City.
D. If any funds remain in the City Escrow upon the occurrence and
satisfaction of the conditions in (A), (B), or (C), such remaining funds shall be
distributed as follows:
(1) To the City that percentage of the remaining funds equal to
$660,000, divided by the sum of $660,000 plus the total payments made
by City to the City Escrow under section 2.2 and
(2) The balance to Dubuque County. For example, if the County
contributes $2,000,000, the formula would be $660,000/$2,660,000 equals
24.8% which is the City share of such remaining funds and Dubuque
County gets the remainder of the funds.
2.3 The total of all City payments to the City Escrow shall be $2,660,000 ("City
Escrow Funds").
2.4 Non -Appropriation.
A. Notwithstanding anything in this Agreement to the contrary, the obligation
of City to pay any installment to the City Escrow shall be an obligation limited to
currently budgeted funds, and not a general obligation or other indebtedness of
City or a pledge of its full faith and credit within the meaning of any constitutional
or statutory debt limitation, and shall be subject in all respects to the right of non -
appropriation by the City Council of City as provided in this Section. City may
exercise its right of non -appropriation as to the amount of the installments to be
paid during any fiscal year during the term of this Agreement without causing a
termination of this Agreement. The right of non -appropriation shall be exercised
only by resolution affirmatively declaring City's election to non -appropriate funds
otherwise required to be paid in the next fiscal year under this Agreement.
B. In the event the City Council of City elects to not appropriate sufficient
funds in the budget for any future fiscal year for the payment in full of the
installment due and payable in that future fiscal year, then City shall have no
further obligation for the payment of any installments due in that future fiscal year
which cannot be paid with the funds then appropriated for that purpose.
C. The right of non -appropriation reserved to City in this Section is intended
by the parties, and shall be construed at all times, so as to ensure that City's
obligation to pay future installments to the City Escrow shall not constitute a legal
indebtedness of City within the meaning of any applicable constitutional or
statutory debt limitation prior to the adoption of a budget which appropriates
funds for the payment of that installment or amount. In the event that any of the
provisions of this Agreement are determined by a court of competent jurisdiction
to create, or result in the creation of, such a legal indebtedness of City, the
4
enforcement of the said provision shall be suspended, and the Agreement shall
at all times be construed and applied in such a manner as will preserve the
foregoing intent of the parties, and no event of default shall be deemed to have
occurred as a result thereof. If any provision of this Agreement or the application
thereof to any circumstance is so suspended, the suspension shall not affect
other provisions of this Agreement which can be given effect without the
suspended provision, and to this end the provisions of this Agreement are
severable.
D. If City's non -appropriation is exercised any funds received by City from
Dubuque County and not contributed to the City. Escrow must be returned to
Dubuque County.
2.5 The cost of demolition of structures on the Property, including the cost to survey,
remove, and dispose of any asbestos or other hazardous building materials that are part
of the structure, (the "Demolition Costs") shall be shared by City and Initiatives as
follows:
A. City's Share: Up to a maximum of $2,660,000 to be paid only out of the
City Escrow Funds and only after depletion of the Initiatives Escrow Funds of
$2,660,000 which shall be provided by Flexsteel, as set forth below in Section
2.6. Funds from the City Escrow may be used only for Demolition Costs and to
pay Reimbursable Costs and Expenses and Recurring Costs of Initiatives.
B. In no event shall City's Share of the Demolition Costs exceed $2,660,000.
C. Any Demolition Costs in excess of the funds in the Initiatives Escrow and
the City Escrow (and any additional funds the parties may obtain for such
purposes) shall be paid by Initiatives.
D. Flexsteel's share of the Demolition Costs shall be limited to the amount of
the Initiatives Escrow. Flexsteel shall be responsible for any costs associated
with the review, removal or remediation of Hazardous Substances from the
Property as required by any Environmental Law, except for costs related to
asbestos removal from any structures on the Property (the "Environmental
Remediation Costs"). It is the parties' intent that Flexsteel shall be responsible for
any and all subsurface Environmental Remediation Costs and shall hold
harmless and indemnify City and Initiatives from and against any such costs.
E. Contingent upon the successful application and receipt of funding of up to
$1,000,000 from the Iowa Economic Development Agency ("IEDA"), the parties
agree that up to $500,000.00 shall be available for use in any legally required
subsurface remediation of the Property.
F. Initiatives shall pay to the City Escrow Agent that Agent's proper and
reasonable fees and expenses, which fees and expenses may be paid from the
5
City Escrow as a Recurring Expense.
2.6 Flexsteel shall fully fund an escrow account (the "Initiatives Escrow") with not
less than Two Million Six hundred and Sixty Thousand Dollars ($2,660,000) which shall
be available to reimburse Initiatives for all Reimbursable Costs and Expenses, including
Demolition Costs and Environmental Remediation Costs, and all Recurring Costs.
Flexsteel shall fund $50,000.00 of such escrow upon execution of this Agreement (for
use by Initiatives to pay costs and expenses associated with Initiatives' obligations
hereunder) and shall fund the balance of the Initiatives escrow at the closing on the
Property. The terms of the Initiatives Escrow and the identity of the Escrow Agent shall
be mutually agreed by Initiatives and Flexsteel. Initiatives shall provide Flexsteel with
estimated budgets and proposed contracts related to the above -ground demolition and
remediation which, if approved in writing by Flexsteel, may be used by the Escrow
Agent for disbursements to Initiatives. Escrow Agent may require such reasonable
information and documentation as required to verify expenditures. In the event
Flexsteel and Initiatives elect to proceed with Early Demolition Work, pursuant to
paragraph 3.6 below, prior to initiation of such work Flexsteel shall fund the Initiatives
Escrow with funds equal to one and one-half times the amount of any bid or estimate for
the Early Demolition Work. Any such funds paid shall be a portion of the $2,660,000.00
required to be paid hereunder.
2.7 In the event Initiatives applies for any funding sources for the environmental
review and environmental remediation of the Property, City and Flexsteel agree to
provide reasonable cooperation in the application process. Any agreement to accept
funding for environmental review or remediation of the Property shall be subject to the
approval of City and Flexsteel, both in their sole discretion. In no event, however, will
City or Flexsteel agree to any funding which requires that City or Flexsteel accept or
assume ownership of the Property. In no event will City agree to funding which requires
City to accept any environmental liability for the Property.
SECTION 3. FUNDING THE ESCROW ACCOUNTS AND ADMINISTRATION OF
THE ESCROW ACCOUNTS.
3.1 The City Escrow Agent shall hold, in accordance with the terms and conditions
set forth in this Agreement, the City Escrow Funds for the purposes of (a) funding City's
contribution, as set forth in Sections 2.1 and 2.2, of Demolition Cost incurred by
Initiatives after May 1, 2017; and (b) paying to City that portion of the City Escrow
Funds, including all interest and earnings thereon, not used by Initiatives to pay City's
contribution to the Demolition Costs. Upon written notification of authorization to
disburse funds executed by City and Initiatives, the City Escrow Agent shall pay City
Escrow Funds directly to the party or parties in such amounts as are directed. On the
date ten (10) years following the date of initial contribution by City of $660,000 to the
City Escrow Fund, unless earlier released due to sale of the Property, the Escrow Agent
shall pay to City the remaining City Escrow Funds, and all interest or other earnings on
the City Escrow Funds.
6
3.2 The City Escrow Funds are deemed public funds of the City until disbursed to
Initiatives or other parties in accordance herewith. Accordingly said funds must only be
invested by the Escrow Agent in accordance with City policy for investment of public
funds. City guidance on approved investment parameters for the Escrow Agent to
follow are attached hereto as Exhibit A. Deviation from said guidance without prior
written approval of the City shall not be permitted.
3.3 Demolition Costs are only eligible for reimbursement from the City Escrow Funds
within 10 years of the date of initial contribution by City of $660,000 to the City Escrow.
3.4 Any costs incurred by Initiatives or its successors that are reimbursed from any
federal or state programs, insurance, or any other third parties, are not eligible for
reimbursement from the City Escrowed Funds.
3.5 Initiatives shall demolish all structures and conduct above -ground remediation
on the Property with the costs thereof paid first from the Initiatives Escrow and then,
after the Initiatives Escrow Fund has been exhausted, from the City Escrow Fund. Any
Demolition Costs in excess of the aggregate funds in the Initiatives Escrow and the City
Escrow (and any additional funds obtained by the parties for such expenses) shall be
paid by Initiatives. Flexsteel shall then complete any under -ground environmental
removal and/or remediation required by law or any governmental agency. Flexsteel
shall not be required to remediate the Property for any use other than light industrial
use. The warranty deed conveying the Property to Initiatives shall contain a covenant
providing that the Property may not be used for any use less intense than the Light
Industrial zoning designation under City's applicable zoning ordinances unless the
proposed owner or user of the Property agrees to pay any and all costs incurred due to
the less intense use, including but not limited to, any additional Environmental
Remediation Costs.
3.6 It is the intent of the parties that demolition of structures by Initiatives shall begin
as soon as possible after the transfer of title to the Property to Initiatives, and that all
above -ground and under -ground remediation shall be completed within ten (10) years
from the date of transfer of title. Initiatives shall hold Flexsteel harmless for any
Demolition Costs which exceed the investment made by Flexsteel. Flexsteel shall hold
harmless and indemnify Initiatives from any Environmental Remediation Costs,
including any expenses associated with migration of pollutants on to or from the
Property or any other required subsurface remediation work. Upon mutual agreement
by Flexsteel and Initiatives, Initiatives may access the Property after the execution
hereof and prior to vacation of the entirety of the Property and begin demolition of
certain agreed upon structures on the Property ("Early Demolition Work"). Any contracts
or other agreements related to Early Demolition Work shall be approved by Flexsteel
prior to commencement of work. In the event the parties mutually agree to proceed with
Early Demolition Work, Flexsteel agrees to indemnify Initiatives from and against any
damages, claims or causes of action that arise from or are in any way related to the
Early Demolition work, with the exception of any negligent, misrepresentation,
misconduct, or unlawful act of Initiatives.
37 To the extent that the demolition and above -ground remediation is completed
and funds remain in the Initiatives Escrow Fund, those funds may be used for any
under -ground remediation required by law or any governmental agency. To the extent
that the demolition and above -ground remediation is completed and no under -ground
remediation is required by law or any governmental agency, any remaining funds in the
Initiatives Escrow Fund shall be returned by the Escrow Agent to Flexsteel.
3.8 Dubuque County shall have the right to review and/or audit upon reasonable
notice and at its expense the City Escrow Fund, including Dubuque Initiative claims or
expenditures, with regard to the Property.
SECTION 4. SALE OF THE PROPERTY AFTER DEMOLITION AND
REMEDIATION.
4.1 Initiatives shall market the Property for sale. City and Dubuque County must
consent to any proposed sale of the Property, which consent shall not be unreasonably
withheld.
4.2 The net proceeds of the sale of the Property shall be distributed as follows:
A. City and the Dubuque County have entered into an Offer to Buy and
Acceptance (the Purchase Agreement) dated the.day o 2017 for the
purchase of certain property described in that Purchase Agr' ement. Fifty percent
(50%) of the net proceeds of the sale of the Property shall be distributed to City
to be distributed by City to County but not to exceed the Purchase Price paid by
County to City under the Purchase Agreement;
B. Seventeen percent (17%) to City but not to exceed City's share of the
Demolition Costs paid out of the City Escrow Fund; and
C. The balance, if any, to Initiatives.
4.3 If the net proceeds from the sale of the Property are insufficient to pay all
Reimbursable Expenses and Costs and Recurring Expenses incurred by Initiatives after
the exhaustion of the Initiatives Escrow Funds and the City Escrow Funds, and any
other funds available for such costs, any development agreement between City and a
developer of the Property may include a provision that City has agreed to share the tax
increment revenue generated from the Property with Initiatives to the extent needed to
extinguish any remaining expenses or debts so long as those expenses relate to
environmental response activities, demolition, asbestos remediation, site preparation,
infrastructure improvements including water, sewer, roads, excavation of soils,
administrative, marketing and professional fees or other contemplated or eligible
expenses under one or more approved tax increment plans, and so long as the Property
is actually generating tax revenues. However, any environmental liability for
environmental contamination which is the liability of Flexsteel shall not receive
8
reimbursement through tax increment.
SECTION 5. RELEASE AND INDEMNIFICATION.
5.1 Except for any negligence, misrepresentation, misconduct, or any unlawful act
of City or Initiatives, Flexsteel releases and shall indemnify, defend, and hold City and
Initiatives, their officers, agents, and employees, harmless from any claim, demand,
suit, action, administrative action, cost, expense, or other proceedings - whatsoever
arising from or related to the condition of the Property or any Hazardous Substance in
or on the Property that existed at the time Initiatives acquires the Property.
5.2 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.
5.3 The provisions of this Section shall survive the termination of this Agreement.
SECTION 6. DEFINITIONS. For the purposes of this Agreement, the following
definitions shall apply:
6.1 "Environmental Law" shall mean any and all federal, state and/or local laws,
regulations and legal requirements pertaining to (i) the protection of health, safety and
the indoor and outdoor environment, (ii) the conservation, management or use of
natural resources and wildlife, (iii) the protection, access to or use of surface water and
groundwater, (iv) the management, manufacture, possession, presence, use,
generation, transportation, treatment) storage, disposal, Release, threatened Release,
abatement, removal, remediation or handling of, or exposure to, any Hazardous
Substance or (v) pollution (including, without limitation, any Release to air, land, surface
water and groundwater), and includes, without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended by the
Superfund Amendment and Reauthorization Act of 1986, 42 U.S.C. 9601 et seq.; the
Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery
Act of 1976 and the Hazardous and Solid Waste Amendments of 1984, 42 U.S.C. 6901
et seq.; the Federal Water Pollution Control Act, as amended by the Clean Water Act of
1977, 33 U.S.C. 1251 et seq.; the Clean Air Act of 1966, as amended, 41 U.S.C. 7401
et seq.; the Toxic Substances Control Act of 1976, 15 U.S.C. 2601 et seq.; the
Hazardous Substances Transportation Act, 49 U.S.C. App. 1801 et seq.; the
Occupational Safety and Health Act of 1970, as amended, 29 U.S.C. 651 et seq.; the
Oil Pollution Act of 1990, 33 U.S.C. 2701 et sea.; the Emergency Planning and
Community Right -to -Know Act of 1986, 42 U.S.C. 11001 et seq.; the National
Environmental Policy Act of 1969, 42 U.S.C. 4321 et sea.; the Safe Drinking Water Act
of 1974, as amended, 42 U.S.C. 300(f) et seq.; Chapter 455B of the Iowa Code; any
similar, implementing or successor law to any of the foregoing and any amendment,
rule, regulation, order or directive issued thereunder.
9
6.2 "Hazardous Substance" or "Hazardous Substances" shall mean any hazardous
or toxic substance, material or waste, which is or becomes regulated by any local
government, the State of Iowa or the United States Government. It includes, without
limitation, any material or substance that is (i) defined as a "hazardous substance" or
"hazardous waste" under Chapter 455B, Iowa Code, (ii) petroleum and petroleum
products, (iii) asbestos containing materials in any form or condition, (iv) designated as
a "hazardous substance" pursuant to Section 311 of the Federal Water Pollution Control
Act (33 U.S.C. § 1321), (v) defined as a "hazardous waste pursuant to § 1004 of the
Federal Resource Conservation and Recovery Act, 42 U.S.C. §6901 et seq., (vi)
defined as a "hazardous substance" pursuant to § 101 of the Comprehensive
Environmental Response, Compensation and Liability Act, U.S.0 § 9601 et seq., or (vii)
defined as a "regulated substance" pursuant to Subchapter IX, Solid Waste Disposal
Act (Regulation of Underground Storage Tanks), 42 U.S.C. § 6991 et seq.] The term
"Hazardous Substance" shall not include any air emissions discharged into the
atmosphere as allowed by a duly issued permit from the applicable governmental
agency.
6.3 "Release" shall mean any spilling, migrating, seeping, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping or disposing of
any Hazardous Substance into the indoor or outdoor environment, including, without
limitation, the abandonment or discarding of barrels, drums, containers, tanks and other
receptacles containing or previously containing any Hazardous Substance and including
without limitation the migration of any Hazardous Substance onto the Property from an
adjacent property.
6.4 "Reimbursable Expenses and Costs" shall mean any and all costs incurred by
Initiatives in any way related to ownership, maintenance or improvement of the
Property, including, but not limited to, Demolition Costs and Environmental Remediation
Costs, any claims or causes of action related to the Property, and costs for removal of
buildings, foundations or other structures, costs of retained experts and attorneys' fees.
Reimbursable Expenses and Costs shall be paid by the respective Escrow Agent first
from the Initiatives Escrow Funds, and after the Initiatives Funds have been exhausted,
from the City Escrow Funds, within thirty (30) days of receipt by the Escrow Agent of an
invoice (and any supporting documentation) from Initiatives and a copy of Flexsteel's
written consent, and, if the funds are to be paid from the City Escrow Funds, City's
written consent to the expense and payment thereof.
6.5 "Recurring Expenses" shall mean those reasonable expenses incurred by
Initiatives that are incurred in holding the Property and that do not relate to taking
physical actions, improvements or changes to the Property. Recurring Expenses shall
expressly include any insurance premium or deductible costs, real estate taxes or
assessments of any kind, security for the Property and attorneys' fees incurred related
to the Property or this Agreement. Recurring Expenses shall be paid to Initiatives from
the Initiatives' Escrow Funds or, if the Initiatives Escrow Funds have been exhausted,
the City Escrow Funds, by the respective Escrow Agent within thirty (30) days of
submission by Initiatives of an invoice, and any reasonable documentation of the
10
expense requested by the Escrow Agent, related to such expense.
SECTION 7. EVENTS OF DEFAULT AND REMEDIES.
7.1 Events of Default Defined. "Events of Default" under this Agreement and the term
"Event of Default", whenever it is used in this Agreement, shall mean:
A Failure by Flexsteel to substantially observe or perform any material
covenant, condition, obligation or agreement on its part to be observed or
performed under this Agreement; or
B Failure by Flexsteel tq substantially observe or perform any material
covenant, condition, obligation or agreement on its part to be observed or
performed under the Development Agreement.
7.2 Remedies on Default by Flexsteel. Whenever any Event of Default referred to in
Section 7.1 of this Agreement occurs and is continuing, City or Initiatives, as specified
below, may take any one or more of the following actions after the giving of written
notice by City or Initiatives to Flexsteel and all other parties to this Agreement 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 Flexsteel does not provide assurances to City or Initiatives that the Event of
Default will be cured as soon as reasonably possible thereafter:
A City or Initiatives may suspend its performance under this Agreement until
it receives assurances from Flexsteel, deemed adequate by City or Initiatives,
that Flexsteel will cure its default and continue its performance under this
Agreement;
B City or Initiatives 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 or to recover
any damages incurred due to such breach.
C City shall be entitled to recover from Flexsteel all amounts expended by
City in connection with the funding of the City Escrow Account, and City may take
any action, including any legal action it deems necessary, to recover such
amounts from Flexsteel. Initiatives shall be entitled to recover from Flexsteel all
amounts expended by Initiatives related to any default of Flexsteel hereunder,
and may take any action, including any legal action it deems necessary, to
recover such amounts from Flexsteel.
7.3 No Remedy Exclusive. No remedy herein conferred upon or reserved to City or
Initiatives 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
11
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.
7.4 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 breach so waived and shall not be deemed to waive any other
concurrent, previous or subsequent breach hereunder.
7.5 Agreement to Pav 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.
7.6 Remedies on Default bv City. If City defaults in the performance of this
Agreement, Flexsteel or Initiatives 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 Flexsteel or Initiatives, or to enforce
performance and observance of any obligation, agreement, or covenant of City under
this Agreement. Flexsteel or Initiatives may suspend performance under this
Agreement until it receives assurances from City, deemed adequate by Flexsteel or
Initiatives, that City will cure its default and continue its performance under this
Agreement.
7.7 Remedies on Default bv Initiatives. If Initiatives defaults in the performance of
this Agreement, Flexsteel or City 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 Flexsteel or City, or to enforce
performance and observance of any obligation, agreement, or covenant of Initiatives
under this Agreement. Flexsteel or City may suspend performance under this
Agreement until it receives assurances from Initiatives, deemed adequate by Flexsteel
or City, that Initiatives will cure its default and continue its performance under this
Agreement.
SECTION 8 GENERAL TERMS AND PROVISIONS.
8.1 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 having been
deposited in any U.S. Postal Service and sent by registered or certified mail, postage
prepaid, addressed as follows:
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If to Flexsteel:
If to City:
If to Initiatives:
Flexsteel Industries, Inc.
Attn: Chief Financial Officer
385 Bell Street
Dubuque, Iowa 52001
Phone: (563) 556-7730
With copy to:
Flexsteel Industries, Inc.
In -House Corporate Counsel
385 Bell Street
Dubuque, Iowa 52001
Phone: (563) 557-7730
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, Iowa 52001
Douglas J. Horstmann, President
c/o Jill Connors
50 W. 13th Street
Dubuque, Iowa 52001
With copy to:
Flint Drake
Drake Law Firm, PC
300 Main St., Suite 323
Dubuque, Iowa 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.
8.2 Binding Effect. This Agreement shall be binding upon and shall inure to the
benefit of City, Initiatives, and Flexsteel and their respective successors and assigns.
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8.3 The Parties agree that Dubuque County, Iowa is an intended Third Party
Beneficiary to Sections 2.2, 3.8, 4.1, and 4.2.
8.4 Subject to Execution of Development Agreement. This Agreement is subject to
the execution of (1) the Development Agreement by City and Flexsteel for the
development of Lot 4 of Dubuque Industrial Center South First Addition in the City of
Dubuque, Iowa by not later than July 1, 2017, (2) an Offer to Buy and Acceptance
Between the City of Dubuque and Dubuque County, Iowa, (3) a purchase agreement
between Dubuque County, Iowa and Flexsteel Industries, Inc. or a wholly-owned
subsidiary of Flexsteel Industries, Inc. and in the event that all such agreements are not
executed by such date, this Agreement shall be null and void without further action of
the parties.
8.5 Insurance. Flexsteel shall maintain at all times during the term of this Agreement
all insurance on the Property in effect as of the date of this Agreement unless and until
Initiatives takes possession and title of the Property as provided in Section 1.
IN WITNESS WHEREOF, City has caused this Agreement to be duly executed in
its name and behalf by its Mayor and attested to by its City Clerk and Flexsteel and
Initiatives have caused this Agreement to be duly executed.
CITY OF DUBUQUE, IOWA
By:
By:
Kevi . Firr stahf
City Jerk
L,
Roy D. B •I, Mayor
DUBUQUE INITIATIVES
By:
Douglas;,i.LHorstmann, President
14
FLEXSTEEL INDUSTRIES, INC.
By: i.'
Timothy all, SVP Finance
CFO and ecretary
EXHIBIT A
CITY INVESTMENT POLICY
15
CITY OF DUBUQUE, IOWA
INVESTMENT POLICY
REVISED JUNE 16, 2016
JEAN NACHTMAN
Table of Contents
1.0 PURPOSE 19
2_0 INVESTMENT POLICY 19
3_0 SCOPE 19
3.1 Pooling of Funds 19
4.0 GENERAL OBJECTIVES 19
4.1 Prescribed Level of Credit Risk 19
4_2 Safety 19
4_3 Liquidity 20
4.4 Yield 20
5M STANDARDS OF CARE 20
5.1 Prudence 21
5.2 Ethics and Conflicts of Interest 21
5.3 Delegation of Authority 21
6M LEGAL AUTHORITY 21
7M INVESTMENT AUTHORITY AND RESPONSIBILITY 24
7.1 Legal Background 24
7.2 Authority and Responsibility Assigned 24
8.0 AUTHORIZED INVESTMENT INSTRUMENTS (Section 12B.10(5)) 24
8.1 Permitted Investments 24
8.2 Prohibited Investments 26
9_0 INVESTMENT OPTIONS 26
10.0 PROFESSIONAL INVESTMENT ASSISTANCE 26
10.1 Investment Advisor Defined 26
10.2 City - Investment Advisor Relationship 26
10.3 Selection of Investment Advisor 27
10.4 Investment Consultant Defined 27
10.5 Selection of Investment Consultant 27
11.0 AUTHORIZED FINANCIAL DEALERS AND INSTITUTIONS 28
11.1 Selection Process .. 28
17
11.2 Financial Institutions and Brokers/Dealers 28
11.3 Financial Advisors and Custodians 28
11.4 Independent Auditor's Verification ')8
12.0 COLLATERALIZATION 29
13.0 MAXIMUM MATURITIES 29
13.1 Operating Funds - Available for Short -Term Investment 29
13.2 Reserve and Construction Funds - Available for Lone -Term Investment 29
14.0 SAFEKEEPING AND CUSTODY 29
14.1 Delivery Versus Payment 29
14.2 Investment Securities 29
14.3 Bonding 29
15.0 DIVERSIFICATION 30
16.0 INTERNAL CONTROLS 30
17.0 REPORTING 30
18.0 ETHICS AND CONFLICT OF INTEREST 30
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CITY OF DUBUQUE, IOWA
INVESTMENT POLICY
1.0 PURPOSE
The purpose of this investment statement is to establish the policy that the City shall follow to promote the
responsible use of public funds as income -earning resources. The statement will outline the methods,
procedures and practices that the City shall follow in carrying out its investment activities.
2.0 INVESTMENT POLICY
It is the policy of the City of Dubuque to invest public funds in a manner which will provide the maximum
security, maintain necessary liquidity and obtain a reasonable investment return, all in accordance with
Iowa statutes governing the investment of public funds.
3.0 SCOPE
This Investment Policy applies to all funds under the management of the City of Dubuque. The funds are
accounted for in the City's Comprehensive Annual Financial Report.
3.1 Pooling of Funds
Except for cash in certain restricted and special funds, the City of Dubuque will consolidate cash
balances from all funds to maximize investment earnings. Investment income will be allocated to
various funds based on their respective participation and in accordance with generally accepted
accounting principles.
4.0 GENERAL OBJECTIVES
The primary objectives, in priority order, of the City's investment activities shall be safety, liquidity and
yield.
4.1 Prescribed Level of Credit Risk
According to General Accounting Standards Board Statement Number 40, paragraphs 68 and 69, the
categories of credit risk for investments, dependent on the nature of the investment and the custodial
provisions are:
• Deposits that are not covered by depository insurance and are (a) uncollateralized, (b)
collateralized with securities held by the pledging financial institution, or (c) collateralized with
securities held by the pledging financial institution's trust department or agent but not in the
depositor -government's name
• Investment securities that are uninsured, are not registered in the name of the government, and
are held by either (a) the counterparty or (b) the counterparty's trust department or agent but not
in the government's name.
The City Treasurer/Finance Director shall arrange safekeeping procedures so that investments are insured
or registered, or are held by the City or its agent in the City's name.
4.2 Safety
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Safety of principal is the foremost objective of the investment program. Investments shall be
undertaken in such a manner that seeks to ensure the preservation of capital in the overall portfolio.
The objective will be to mitigate credit risk and interest rate risk.
a. Credit Risk
The City will minimize the risk of loss due to the failure of the security issuer or backer, by:
• Limiting investments to the safest types of securities
• Pre -qualifying the financial institutions, broker/dealers, intermediaries, and advisors with
which the City will do business
• Diversifying the investment portfolio so that potential losses on individual securities will
be minimized.
• An investment shall be rated within the two highest classifications as established by at
least one of the rating review services approved by the Superintendent of Banking by Rule
adopted pursuant to Chapter 17A.
b. Interest Rate Risk
The City will minimize the risk that the market value of securities in the portfolio will fall due
to changes in general interest rates, by:
• Structuring the investment portfolio so that securities mature to meet cash requirements
for ongoing operations, thereby avoiding the need to sell securities on the open market
prior to maturity.
• Investing operating funds primarily in shorter -term securities, money market mutual
funds, or similar investment pools.
• Investing in securities with adjustable coupons.
c. Duration Risk
• Less than or equal to six years
• Manager should disclose duration of portfolio on monthly reports
• Prepayment risk for mortgaged back securities needs to be disclosed
4.3 Liquidity
The investment portfolio shall remain sufficiently liquid to meet all operating and capital
requirements that may be reasonably anticipated by structuring the portfolio so that securities
mature concurrent with cash needs to meet anticipated demands. Furthermore, since all possible
cash demands cannot be anticipated, the portfolio will consist largely of securities with active
secondary or resale markets. A portion of the portfolio also may be placed in money market
mutual funds or investment pools that provide same-day liquidity for short-term funds.
4.4 Yield
The investment portfolio shall be constituted with the objective of attaining a market rate of return
throughout budgetary and economic cycles, taking into account the investment risk constraints and
liquidity needs. The return on investments is to be accorded secondary importance compared to the
safety and liquidity objectives described above. The core of investments will focus on relatively low
risk securities with an expectation of earning a fair return relative to the risk being assumed.
Securities shall not be sold prior to maturity, with the following exceptions:
a. A security with declining value may be sold early to minimize loss of principal.
b. A security may be exchanged to improve the quality, yield or target duration in the portfolio
c. A security may be sold in order to satisfy liquidity requirements.
5.0 STANDARDS OF CARE
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5.1 Prudence
The criterion for the management decisions to be exercised by the investment officials shall be the
"prudent person" standard, and shall be applied in the context of managing an overall portfolio.
Investment officers acting in accordance with written procedures and this investment policy and
exercising due diligence shall be relieved of personal responsibility for an individual security's
credit risk or market price changes, provided deviations from expectations are reported in a timely
manner and the liquidity and the sale of securities are administered in accordance with the terms of
this policy. Investments shall be made with judgment and care, under circumstances then prevailing,
which persons of prudence, discretion and intelligence exercise in the management of their own
affairs, not for speculation, but for investment, considering the probable safety of their capital as
well as the probable income to be derived.
5.2 Ethics and Conflicts of Interest
Officers and employees involved in the investment processes shall refrain from personal business
activity that could conflict with the proper execution and management of the investment program, or
could impair their ability to make impartial decisions. Employees and investment officials shall
disclose any material interests in financial institutions with which business is conducted. They shall
further disclose any personal financial or investment positions that could be related to the
performance of the investment portfolio. Also, these same individuals shall refrain from undertaking
personal investment transactions with the same individual with whom investment business is
conducted on behalf of the City.
5.3 Delegation of Authority
The authority for management of the investment program is vested in the City Treasurer/Finance
Director and is derived from Section 12B.10, Subsection 1, of the Code of Iowa. In the absence of
the City Treasurer/Finance Director, the authorization is delegated first to the Assistant Finance
Director and then to the Budget Director. Responsibility for the operation of the investment program
is hereby delegated to the appropriate investment officer, who shall act in accordance with
established written procedures and internal controls for the operation of the investment program
consistent with this investment policy.
6.0 LEGAL AUTHORITY
Code of Iowa
The following is a summary of sections of the Code of Iowa applicable to City investments administration. •
• Section 372.8. Council - Manacer Form of Government - Supervision
(1) The City Manager is the chief administrative officer of the City and shall:..
(2)(n) Appoint a treasurer subject to the approval of the Council .. .
• Section 12B.10. Public Funds Investment Standards
The City Treasurer/Finance Director shall at all times keep funds coming into the City's
possession as public money in a vault or safe to be provided for that purpose or in one or more
depositories approved pursuant to Chapter 12C. However, the City Treasurer/Finance Director
shall invest, unless otherwise provided, any public funds not currently needed in investments
authorized by this section.
2. The City Treasurer/Finance Director and other investment officials of the City, when investing,
depositing, or acting as custodian of public funds are acting in a fiduciary capacity for the
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citizens of Dubuque and shall exercise the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent person acting in a like capacity and familiar with
such matters would use to attain the goal of this subsection. This standard requires that when
making investment decisions, a public entity shall consider the role the investment or deposit
plays within the portfolio of assets of the public entity and the goals of this subsection.
The primary goals of investment prudence shall be based in the following order of priority:
a. Safety of principal is the first priority.
b. Maintaining the necessary liquidity to match expected liabilities is the second priority.
c. Obtaining a reasonable return is the third priority.
3. Investments of public funds shall be made in accordance with written policies. A written
investment policy shall address the goals set out in Iowa Code Section 12B.10(2) and shall also
address, but is not limited to, compliance with Iowa law, diversification, maturity, quality and
capability of investment management.
The trading of securities in which any public funds are invested for the purpose of speculation
and the realization of short-term trading profits is prohibited.
City investments must have maturities that are consistent with the needs and use of the City.
4. Subsection 5 of Section 12B.10 identifies permitted investments and is included in Section 8.0
of this Investment Policy.
• 12B.10A. Public Investment Maturity and Procedural Limitations
1. "Operating fiends" means those funds which are reasonably expected to be expended during a
current budget year or within fifteen months of receipt. Operating funds are subject to the
following limitations:
a. Operating funds must be identified and distinguished from all other funds available for
investment.
b. Operating funds may only be invested in investments which mature within 397 days or
less and which are authorized by law and as limited by this written investment policy of
the City.
2. All investments of public funds by the City shall be subject to the following:
a. Each investment must be authorized by applicable law and as limited by the written
investment policy of the City.
b. All custodial agreements shall comply with rules adopted by the Treasurer of State
pursuant to Iowa Code Section 12B.10C.
c. All contracts providing for the investment of public funds shall be in writing and shall
contain a provision requiring that all investments shall be in accordance with the laws of
the State and as limited by the written investment policy of the City.
d. A contract for the investment or deposit of public funds shall not provide for
compensation of an agent or fiduciary based upon investment performance.
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3. A City Treasurer/Finance Director may invest funds that are not operating funds in investments
having maturities longer than 397 days to provide funding for pay-as-you-go financing of
utility construction and required bond and insurance reserves.
• Section 12B.10B. Written Investment Policy
1. Political subdivisions shall approve written investment policies which incorporate the
guidelines specified in Section 12B.10, Sections 12B.10A through 12B.10C, and any other
provisions deemed necessary to adequately safeguard public funds.
2. The written investment policy must be delivered to all of the following:
a. City Council.
b. All depository institutions or fiduciaries for public funds of the City.
c. The auditor of the City.
• Section 12B.10C. Reeulation of Public Funds Custodial Aereements
"Public Funds Custodial Agreement" means any contractual arrangement pursuant to which one or
more persons (including but not limited to, investment advisors, investment companies, trustees,
agents, the federal reserve and custodians) are authorized to act as a custodian of or to designate
another person to act as a custodian of public funds or any security or document of ownership or title
evidencing public funds investments. This does not include custodial agreements between an open-end
management investment company registered with the Federal Securities and Exchange Commission
and a custodian bank.
The City of Dubuque shall comply with any rules adopted by the Treasurer of the State of Iowa
requiring the inclusion in public fund custodial agreements any provision necessary to prevent loss of
public funds.
However, this section does not apply to public funds that are invested under the provisions of a
resolution or indenture for the issuance of bonds, notes, certificates, warrants, or other evidences of
indebtedness.
• Section 12C.1. Deposits in General - Definitions
The City Treasurer/Finance Director shall invest all funds not needed for current operating expenses in
time certificates of deposit in approved depositories pursuant to this chapter, or in investments
permitted in Section 12B.10.
Current operating funds are retained in interest bearing checking and savings accounts with local
financial institutions.
• Section 12C.9. Investment of Sinkine Funds - Bond Proceeds
The City Treasurer/Finance Director may invest the proceeds of public bonds or obligations and funds
being accumulated for the payment of principal and interest or reserves in investments set out in
Section 12B.10, Subsection 4, paragraphs "a" through "g", an investment contract or tax exempt bonds.
The investment shall be as defined and permitted by Section 148 of the Internal Revenue Code and
applicable regulations under this section. An investment contract or tax exempt bonds shall be rated
within the two highest classifications as established by at least one of the standard rating services
approved by the Superintendent of Banking by rule adopted pursuant to Chapter 17A.
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• Sections 12C.15 through 12C.23 pertain to collateralization requirements. They are not repeated here
because of the length of these sections. Those sections are hereby incorporated by reference.
• Section 384.21. Joint Investment of Funds
A city or a city utility board shall keep all funds invested to the extent practicable, and may invest the
funds jointly with one or more cities, utility boards, judicial district departments of correctional
services, or counties pursuant to a joint investment agreement. All investment of finds shall be subject
to Sections 12B.10 and 12B.10A and other applicable laws.
7.0 INVESTMENT AUTHORITY AND RESPONSIBILITY
7.1 Legal Background
The City Council is charged, under Iowa Code Section 12B.10B, with approving a written investment
policy which incorporates the guidelines specified in Section 12B.10 entitled "Public Funds
Investment Standards"; Section 12B.10A entitled "Public Investment Maturity and Procedural
Limitations"; Section 12B.10B entitled "Written Investment Policies"; and Section 12B.10C entitled
"Regulation of Public Funds Custodial Agreements" and which are described in Section 6.0 of this
Investment Policy entitled "Legal Authority".
Authority to invest City funds is designated in the City Treasurer/Finance Director by Iowa statute as
designated above. (Iowa Code Section 12B.10, Subsection 1)
The City Manager, as chief administrative officer for the City, is responsible by statute for budget
preparation, overall business affairs of the City and appointment, with City Council approval, of the
City Treasurer/Finance Director.
7.2 Authority and Responsibility Assigned
The City Treasurer/Finance Director shall establish written procedures for the operation of the
investment programs consistent with this Investment Policy. Procedures should include references to
safekeeping, repurchase agreements, money managers, wire transfer agreements,
collateral/depository agreements and banking service contracts.
The City Treasurer/Finance Director shall invest all funds in accordance with this policy. In the
absence of the City Treasurer/Finance Director, the Assistant Finance Director shall be responsible
and in the absence of the Assistant Finance Director, the responsibility shall be assumed by the
Budget Director. No person shall engage in an investment transaction except as provided under the
terms of this investment policy and the procedures established by the City Treasurer/Finance
Director. The City Treasurer/Finance Director shall be responsible for all transactions undertaken
and shall establish a system of controls and reports to inform the City Manager of the details of
investment transactions. At least quarterly the City Manager shall meet with the City
Treasurer/Finance Director to discuss the status of current investments, strategies for future
investments and other investment matters deemed necessary. Quarterly and fiscal year-to-date
reports shall be provided by the City Manager to the City Council so they can review performance of
the investments.
In carrying out prescribed responsibilities the City Manager may establish an internal City Investment
Committee. The City has established an Investment Oversight Advisory Commission. Bylaws of the
Commission are attached.
8.0 AUTHORIZED INVESTMENT INSTRUMENTS (Section 12B.10(5))
8.1 Permitted Investments
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Investment instruments authorized for purchase by the City Treasurer/Finance Director shall be
limited to:
1. United States Government, Agency and Instrumentality Obligations.
2. Certificates of Deposit (time, demand and/or negotiable) and other evidences of deposit such
as time deposits, savings accounts at federally insured depository institutions approved
pursuant to Chapter 12C, Code of Iowa.
3. Prime bankers' acceptances that mature within 270 days and that are eligible for purchase by
a federal reserve member bank provided that at the time of purchase no more than ten percent
of the investment portfolio shall be in investments authorized by this paragraph and that at the
time of purchase no more than five percent of the investment portfolio shall be invested in the
securities of a single issuer.
4. Repurchase agreements. A master repurchase agreement between the City and bank or dealer
must be in place prior to entering into any repurchase transaction. The master repurchase
agreement must include the following provisions:
a. The underlying collateral shall be limited to United States Government, Agency and
Instrumentality Obligations;
b. Collateral shall be marked -to -market daily by the custodian and shall be maintained at
value equal to or greater than the cash investment;
c. At the time of purchase, the market value of the collateral shall represent 102 percent
of the cash investment;
d. An authorized third party custodian or safekeeping agent shall hold all securities
purchased under a repurchase agreement;
e. A seller of repurchase securities shall not be entitled or authorized to substitute
collateral, except as authorized by the City Treasurer/Finance Director; and
f. Retail repurchase agreements and reverse repurchase agreements shall not be
authorized for purchase.
5. Management investment company including open ended, exchanged or closed end registered
with the Federal Securities and Exchange Commission under the Federal Investment
Company Act of 1940, 15 U.S.C. §80(a), and operating in accordance with 17 C.F.R.
§270.2a-7, provided such entity limits its investments to those allowed by this policy.
6. A joint investment trust organized pursuant to Chapter 28E of the Iowa Code prior to and
existing in good standing on the effective date of this Act or a joint investment trust organized
pursuant to Chapter 28E after April 28, 1992, provided that the joint investment trust shall
either be rated within the two highest classifications by at least one of the standard rating
services approved by the Superintendent of Banking by rule adopted pursuant to Chapter 17A
and operated in accordance with 17 C.F.R. §270.2a-7, or be registered with the Federal
Securities and Exchange Commission under the Federal Investment Company Act of 1940, 15
U.S.C. §80(a) and operated in accordance with 17 C.F.R. §270.2a-7. The manager or
investment advisor of the joint investment trust shall be registered with the Federal Securities
and Exchange Commission under the Investment Advisor Act of 1940 15 U.S.C., § 80(b), as
amended, provided such entity limits its investments to those allowed by this policy.
7. Participation in investment pools is authorized by Section 384.21. The City may participate
in investment pools after approved by the City Council as an action item on the City Council
25
agenda. Recommendations from the City Manager for participation in a pool or trust shall
include in the background portion of the cover memo a discussion of research findings on the
reliability and experience of the firm and its top executive officer(s). Participation is limited
to pools that invest only in authorized instruments identified above and whose investment
strategy is consistent with the City's Investment Policy.
8. Agency issued Collateralized Mortgage Obligations (CMO's), which are securities
underwritten and guaranteed by Ginnie Mae, Fannie Mae or Freddie Mac.
8.2 Prohibited Investments
1. Futures and options contracts are not permissible investments. Iowa Code Section
12B.10(5)(h).
2. Whole loan CMO's or privately labeled CMO's, which are typically issued by private entities
including subsidiaries of investment banks, financial institutions and home builder's or
mutual funds that hold whole loan CMO.
3. The trading of securities in which any public funds are invested for the purpose of speculation
and the realization of short-term trading profits is prohibited. (Iowa Code Section 12B.10(3)).
4. International bonds are not permissible investments.
5. Corporate bonds are not permissible investments.
6. Municipal securities approved by Municipal Security Rulemaking Board (MSRB).
9.0 INVESTMENT OPTIONS
The City Treasurer/Finance Director is not required to use all the investment options authorized by this
Investment Policy. The selection of investment options shall be determined by the legal requirements or
other limitations on investment opportunities, cash flow characteristics, the acceptability of exposure to
market risks, the rate of return, the technical ability of the staff responsible for administering the investment
program, and the availability of time and tools for City staff to engage in conservative but active
management.
10.0 PROFESSIONAL INVESTMENT ASSISTANCE
This investment policy authorizes the use of investment advisors (money managers) and investment
consultants to assist the City in the management of its invested funds.
10.1 Investment Advisor Defined
An "investment Advisor" (money manager) is a person or firm with investment expertise paid a
fee to manage funds to enhance the rate of return. The investment advisor shall be selected
because of the advisor's investment expertise, experience, strategy and fund management aids.
The investment advisor shall determine the actual investments to be made of funds under
management according to this Investment Policy. This Investment Policy shall apply in all aspects
to the investment activities of the City's investment advisor.
10.2 City - investment Advisor Relationship
The investment advisor's plan shall be explicit, in writing, personally presented to the City at least
annually and mutually agreed upon. Any meaningful change to the plan should be communicated
in writing to the City in the interim. It shall also be within the competence of the investment
advisor; be realistic and reasonable relative to the market; and satisfy the legitimate and informed
expectations of the City.
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Investment advisor compensation shall not be based upon performance. (Section 12B.10A(2)(c))
10.3 Selection of Investment Advisor
Prospective investment advisors shall be examined in three major areas: professional investment
competence, commitment to City service, and soundness of business strategy.
A prospective investment advisor must have a clear concept of how to add value to the City's
portfolio. Such a concept can be based upon the advisor's perception of an opportunity in the
market that presents opportunities for it to increase the portfolio's rate of return. In addition to a
sound concept of how to add value, the advisor must have developed a sensible process for
making decisions to execute the concept, and must have a convincing record of achievement of the
results intended.
The advisor will be reasonably accessible for the convenience of personal meetings and will be a
fixed -fee-based provider of services and not a performance -based -fee provider. Monthly, calendar
year-to-date, one year, three year, five year and from inception returns need to be reported by each
investment advisor monthly in order to capture a full market cycle. Returns should be reported
gross and net of fees. The investment advisors should include the following benchmarks* for
comparison in the reporting:
• 90 Day T -Bills
• Lehman Brothers Aggregate U.S. Bonds
• Lehman Brothers Short Term 1-3 year U.S. Bonds
• Lehman Brothers Government Intermediate U.S. Bonds
*Specific benchmark requirements are subject to change.
10.4 Investment Consultant Defined
An "Investment Consultant" is a person or firm with investment expertise used by the City to
assist in the development of investment plans and strategies that are consistent with the Investment
Policy, to identify investment advisors whose investment management style and strategy are
consistent with the objectives, intent and limitations of the Investment Policy and to monitor the
performance of the investment advisors selected by the City. The investment consultant shall not
be an investment advisor (money manager) or custodian and may not benefit in any manner from
making investments in behalf of the City.
10.5 Selection of Investment Consultant
The Investment Consultant may be an individual or firm. Said consultant will be thoroughly
familiar with all investment instruments authorized for use in the City of Dubuque Investment
Policy. The consultant will be or will become knowledgeable as to the intent of the City of
Dubuque Investment Policy. The consultant will convey this intent to prospective investment
advisors to guarantee the suitability of investment instruments to be selected by said advisor(s).
The individual consultant or the individual representing the consultant firm will have had at least
five years of hands on experience in the selection process and in monitoring of investment
advisors or closely related experience, such as, having worked in an advisory capacity for at least
five years.
The consultant will be reasonably accessible for the convenience of personal meetings and will be
a fee based provider of services and may not benefit in any manner from making investments in
behalf of the City. The consultant will have an orientation toward the needs and requirements
pertaining to the investment of public funds.
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11.0 AUTHORIZED FINANCIAL DEALERS AND INSTITUTIONS
11.1 Selection Process
A set, formal process shall be used to select financial advisors, third party custodians, and
brokers/dealers in money market instruments. Authorized dealers and Institutions must be
approved by the City Investment Committee and City Treasurer/Finance Director. This policy is
intended to screen out institutions that lack economic viability or whose past practices suggests
that the safety of public capital would be impaired if transactions were directed to or through such
firms. As required by Chapter 23A.3, Code of Iowa, it shall be City policy to consider purchasing
services from locally owned businesses if the cost and other considerations are relatively equal.
The City Treasurer/Finance Director shall maintain a list of investment advisors and financial
institutions authorized to provide investment advisor and custodian services. In addition, a list
shall also be maintained of approved security broker/dealers selected by credit worthiness. These
may include "primary" dealers or regional dealers that qualify under Securities & Exchange
Commission Rule 15C3-1 (uniform net capital rule). Investment Advisory Firms registered with
the SEC under the Investment Advisors Act of 1940. No public deposit shall be made except in a
qualified public depository as established by the Treasurer of the state of Iowa. The City may also
maintain an account with the federal reserve for custodial services and investment transactions.
11.2 Financial Institutions and Brokers/Dealers
All financial institutions and broker/dealers who desire to become qualified bidders for investment
transactions of the City of Dubuque or its investment advisors shall supply the City
Treasurer/Finance Director with the following: annual audited financial statements or Uniform
Application for Investment Advisor Registration (ADV) report, proof of state registration if
applicable, or Federal Depository Bank registration and certification of having read the City of
Dubuque's Investment Policy. An annual review of the financial condition and registrations of
qualified bidders shall be conducted by the City Treasurer/Finance Director or his/her designee.
Each financial institution and broker/dealer that bids on City of Dubuque (or City of Dubuque
investment advisors) investment transactions shall file a current audited financial statement.
11.3 Financial Advisors and Custodians
All financial institutions who desire to become qualified to bid on investment custodial services
shall execute the City of Dubuque's Investment Custodial Agreement and supply the City
Treasurer/Finance Director with the following: audited financial statements and certification of
having read the City of Dubuque's Investment Policy and Custodial Agreement. Before funds are
placed with a financial institution acting as custodian of City funds for the City of Dubuque, an
executed Custodial Agreement shall be on file with the City Treasurer/Finance Director.
All qualified investment advisors shall execute the City of Dubuque's Investment Advisor
Agreement and shall supply the City Treasurer/Finance Director with one of the following:
audited financial statements, Uniform Application for Investment Advisor Registration (ADV),
proof of SEC registration or federal depository bank registration. Monthly detailed transaction
accounting will be required.
11.4 Independent Auditor's Verification
The City's independent auditor verifies account balances for securities/instruments being held by
the custodian annually.
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12.0 COLLATERALIZATION
Collateralization shall be required on two types of investments: Certificates of Deposit, and other evidence
of deposit at City Council approved insured depository institutions; and repurchase agreements. In order to
anticipate market changes and provide a level of security for all funds, the collateralization level shall be
that as is required by Iowa law for Certificates of Deposit and other evidence of deposit and 102 percent of
market value of principal and accrued interest for repurchase agreements.
The City chooses to limit collateral to those investment instruments authorized by this Investment Policy.
Collateral shall always be held by an independent third party bailee who holds the collateral for the benefit
of the City and where the City is a party to the bailee agreement. A clearly marked evidence of ownership
(safekeeping receipt) shall be supplied to the City and retained by the City Treasurer/Finance Director.
Collateral substitution is not authorized, except as approved in writing by the City Treasurer/Finance
Director.
13.0 MAXIMUM MATURITIES
The City of Dubuque will attempt to match its investments with anticipated cash flow requirements.
13.1 Operating Funds - Available for Short -Term Investment
Operating funds represent fund balances, current revenues and other moneys anticipated to be
expended during a current fiscal year or within 15 months of receipt. Operating funds may only
be invested in instruments that mature within 397 days or less. Operating funds must be identified
and distinguished from all other funds available for investment. (Section 12B.10A(1)
13.2 Reserve and Construction Funds - Available for Long -Term Investment
Reserve and construction funds available for long-term investment represent debt service and self-
insurance and operating reserve funds; funds being accumulated for capital improvements on a
pay-as-you-go basis; and construction funds for future projects. These funds may be invested in
investments having maturities longer than 397 days. (Section 12B.10A(3) The maturities for
long-term investments shall coincide as nearly as practicable with expected use of the funds. For
securities with maturity longer than one year, duration will be used as the primary measure of
maturity rather than final maturity of the financial instrument. The City Treasurer/Finance
Director will provide written notice of anticipated withdrawals.
14.0 SAFEKEEPING AND CUSTODY
14.1 Delivery Versus Payment
All security transactions, including collateral for repurchase agreements, entered into by the City
of Dubuque shall be conducted on a delivery -versus -payment (DVP) basis. Securities will be held
by a third party custodian designated by the Treasurer and evidenced by safekeeping receipts.
14.2 Investment Securities
Investment securities shall be held by the City Treasurer/Finance Director or by a custodian who:
(a) is not also the Investment Manager for the funds; (b) is designated in writing by the City
Treasurer/Finance Director; and (c) will issue safekeeping receipts to the City Treasurer/Finance
Director for securities held for the City.
14.3 Bonding
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City investment officials shall be bonded to protect the public against possible embezzlement
and/or malfeasance.
15.0 DIVERSIFICATION
The City shall diversify its investments by security type, maturity, specific issue and financial institution.
With the exception of U.S. Government Treasury Securities, federal agencies and instrumentality's, and
deposits in approved depositories, no more than twenty-five (25) percent of the City's remaining investment
portfolio shall be invested in a single authorized pool.
16.0 INTERNAL CONTROLS
The City Treasurer/Finance Director shall be responsible for establishing a system of internal controls that
will provide reasonable assurance that the City investments comply with the objectives of the Investment
Policy. The system shall include but not be Limited to the following:
1. All investment transactions shall be reported to the Assistant Finance Director and the results
recorded in the general ledger.
2. Verification of the securities held by the Assistant Finance Director shall be conducted internally,
at least semiannually.
3. Review of compliance with the internal policy and related procedures shall be part of the annual
audit process conducted by the City's independent auditors. This shall include a confirmation
letter from each financial institution, money manager and third party custodian verifying the
principal amount and the market value of all obligations secured by the City of Dubuque's deposits
and investments. Managers should disclose pricing service used for MBS.
17.0 REPORTING
The City Treasurer/Finance Director is charged with the responsibility of including a market report on
investment activities and returns in the City's comprehensive annual fiscal report. In addition, the City
Manager shall be responsible for providing quarterly and fiscal year-to-date reports to the City Council,
covering the City's investment activities. The reports shall include the earnings for the period and overall
portfolio statistics, such as types of investment holdings and location of all invested funds.
18.0 ETHICS AND CONFLICT OF INTEREST
City officers and employees involved in the investment process shall refrain from personal business activity
that could conflict with the proper execution of the investment program, or which could impair the ability
to make impartial investment decisions. Such officers and employees shall disclose to the City Council any
material financial interests in financial institutions that conduct business with the City and they shall further
disclose any large personal financial/investment positions that could be related to the City's portfolio. City
officers and employees shall subordinate their personal investment transactions to those of the City
particularly with regard to the time of purchases and sales.
The appearance of a conflict of interest shall also be avoided by those investing City funds.
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1
1
DEVELOPMENT AGREEMENT
BETWEEN
THE CITY OF DUBUQUE, IOWA
AND
FLEXSTEEL INDUSTRIES, INC.
THIS DEVELOPMENT AGREEMENT (this Agreement), dated for reference
purposes the _ day of , 2017, 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 (Urban Renewal Act), and Flexsteel
Industries, Inc., an Iowa 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 (the Urban Renewal Plan) attached hereto as
Exhibit A; and
WHEREAS, a copy of the Urban Renewal Plan, as constituted on the date of this
Agreement, has been recorded among the land records in the office of the Recorder of
Dubuque County, Iowa and is on file with the City of Dubuque City Clerk; and
WHEREAS, Developer has determined that it requires a new industrial facility to
maintain its operations and employment in the Project Area (the Facility); and
WHEREAS, Developer will have acquired title as of the Closing herein to 26.79
acres of which 22.00 are usable, legally described as follows (the Property):
Lot 4 of Dubuque Industrial Center South First Addition in the City of
Dubuque, Iowa
with all easements, tenements, hereditaments, and appurtenances belonging thereto, as
shown as Exhibit B, so that Developer may develop the Property, located in the Project
Area, for the construction, use, and occupancy of an industrial building in accordance with
the uses specified in the Urban Renewal Plan and Developer agrees to comply with any
Development Agreement City and Flexsteel 051117bal
amendments to the Urban Renewal Plan, in accordance with this Agreement; and
WHEREAS, City, believes that the development 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. CLOSING.
1 .1 Representations and Warranties of City.
(1) City has duly obtained all necessary approvals and consents for its
execution, delivery and performance of this Agreement, and it has full power and
authority to execute, deliver and perform its obligations under this Agreement.
City's attorney shall issue a legal opinion to Developer at time of Closing confirming
the representation contained herein, in the form attached hereto as Exhibit C.
(2) City shall exercise its best efforts to resolve any disputes arising during the
development process in a reasonable and prompt fashion.
(3) The Property is presently zoned to accommodate Developer's intended
improvements and the manufacturing of upholstered furniture and steel products.
The representations and warranties contained in this Section shall be correct in all
respects on and as of the Closing with the same force and effect as if such
representations and warranties had been made on and as of the Closing Date.
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) The representations and warranties made by City in Section 1 .4 shall be
correct as of the Closing Date with the same force and effect as if such
representations were made at such time. At the Closing, City shall deliver a
certificate in the form of Exhibit F.
(2) Developer will have acquired title to the Property;
(3) Developer and City shall be in material compliance with all the terms and
provisions of this Agreement.
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(4) Developer shall have furnished City with evidence, in a form satisfactory to
City (such as audited financial statements in a Form 10-Q), that Developer has firm
financial commitments in an amount sufficient, together with equity commitments,
to complete the Minimum Improvements (as defined herein) in conformance with
the Construction Plans (as defined herein), or City shall have received such other
evidence of such party's financial ability as in the reasonable judgment of City is
required.
(5) Receipt of an opinion of counsel to Developer in the form attached hereto
as Exhibit D.
(6) Developer shall have the right to terminate this Agreement at any time prior
to the consummation of the closing on the Closing Date if Developer determines
in its sole discretion that conditions necessary for the successful completion of the
Project contemplated herein have not been satisfied to the full satisfaction of such
party in such party's sole and unfettered discretion. Upon the giving of notice of
termination by such terminating party to the other parties to this Agreement, this
Agreement shall be deemed null and void.
1 .3 Closing. The closing (the Closing) shall take place on the Closing Date. The
Closing Date is August 1 , 2017 at 10:00 o'clock a.m., at the City Attorney's office, or such
other date as the parties agree in writing. 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 City's Obligations at Closing. At or prior to Closing Date, City shall Deliver to
Developer such other documents as may be required by this Agreement, all in a form
satisfactory to Developer.
SECTION 2. DEVELOPMENT ACTIVITIES.
2.1 Required Minimum Improvements. City acknowledges that the Facility Developer
is building is an industrial facility. Specifically, Developer agrees to construct the building
and certain internal systems thereto, and with finishing the building including, without
limitation, all interior improvements (the Minimum Improvements); all as more particularly
depicted and described on the plans and specifications to be delivered to and approved
by City as contemplated in this Agreement. Developer hereby agrees the Facility will be
not less than two hundred fifty thousand (250,000) square feet of floor space along with
the necessary site work, machinery and equipment at an estimated cost of approximately
$25,000,000.
2.2 Plans for Construction of Minimum Improvements. Plans and specifications with
respect to the development of the Property and the construction of the Minimum
Improvements thereon (the Construction Plans) shall be in conformity with the Urban
Renewal Plan, this Agreement, and all applicable state and local laws and regulations,
including but not limited to the Amended and Restated Declaration of Covenants,
3
Conditions, Restrictions, Reservations, Easements, Liens and Charges, recorded as
Instrument No. 2014-00001147, records of Dubuque County, Iowa. Developer shall
submit to City, for approval by City, plans, drawings, specifications, and related
documents with respect to the improvements to be constructed by Developer on the
Property. All work with respect to the Minimum Improvements shall be in substantial
conformity with the Construction Plans approved by City.
2.3 Timing of Improvements.
(1) Developer hereby agrees that construction of the Minimum Improvements
shall be commenced on or before August 1 , 2017, and shall be substantially
completed by September 30, 2018. The time frames for the performance of these
obligations shall be suspended due to unavoidable delays, meaning delays outside
the control of the party claiming its occurrence in good faith, which are the direct
result of strikes, other labor troubles, unusual shortages of materials or labor,
unusually severe or prolonged bad weather, acts of God, fire or other casualty to
the Minimum Improvements, litigation commenced by third parties which, by
injunction or other similar judicial action or by the exercise of reasonable discretion
directly results in delays, or acts of any federal, state or local government which
directly result in extraordinary delays. The time for performance of such
obligations shall be extended only for the period of such delay.
2.4 Certificate of Completion. Promptly following the request of Developer upon
completion of the Minimum Improvements the City Manager shall furnish Developer with
an appropriate instrument so certifying. Such certification (the Certificate of Completion)
shall be in recordable form and shall be a conclusive determination of the satisfaction and
termination of the agreements and covenants in this Agreement and in the Deed with
respect to the obligations of Developer to construct the Minimum Improvements. The
Certificate of Completion, in the form attached hereto as Exhibit G, shall waive all rights
of re-vestment of title to the Property as provided in Section 7.3(1).
SECTION 3. CITY PARTICIPATION.
3.1 Economic Development Grants.
(1) For and in consideration of Developer's obligations hereunder, and in
furtherance of the goals and objectives of the Urban Renewal Plan for the Project
Area and the Urban Renewal Law, City agrees, subject to Developer being and
remaining in compliance with the terms of this Agreement, to make twenty (20)
consecutive semi-annual payments (such payments being referred to collectively
as the Economic Development Grants) to Developer, as follows:
November 1 , 2020 May 1 , 2021
November 1 , 2021 May 1 , 2022
November 1 , 2022 May 1 , 2023
November 1 , 2023 May 1 , 2024
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November 1 , 2024 May 1 , 2025
November 1 , 2025 May 1 , 2026
November 1 , 2026 May 1 , 2027
November 1 , 2027 May 1 , 2028
November 1 , 2028 May 1 , 2029
November 1 , 2029 May 1 , 2030
pursuant to Iowa Code Section 403.9 of the Urban Renewal Law, in amounts equal
to the actual amount of tax increment revenues collected by City under Iowa Code
Section 403.19 (without regard to any averaging that may otherwise be utilized
under Iowa Code Section 403.19 and excluding any interest that may accrue
thereon prior to payment to Developer) during the preceding six-month period in
respect of the Property and Minimum Improvements constructed by Developer
thereon (the collected tax increment revenue being referred to herein as the
Developer Tax Increments). Developer recognizes and agrees that the Economic
Development Grants shall be paid solely and only from the incremental taxes
collected by City in respect of the Property and Minimum Improvements, which
does not include property taxes collected for the payment of bonds and interest of
each taxing district, and taxes for the regular and voter-approved physical plant
and equipment levy, instructional support levy, and any other portion required to
be excluded by Iowa law, and thus such incremental taxes will not include all
amounts paid by Developer as regular property taxes.
(2) To fund the Economic Development Grants, City shall certify to the County
prior to December 1 of each year, commencing December 1 , 2019, its request for
the available Developer Tax Increments, resulting from the assessments imposed
by the County as of January 1 of that year, to be collected by City as taxes are
paid during the following fiscal year and which shall thereafter be disbursed to
Developer on November 1 and May 1 of that fiscal year. (Example: If City so
certifies by December 1 , 2019, the Economic Development Grants in respect
thereof would be paid to Developer on November 1 , 2020, and May 1 , 2021 .)
(3) The Economic Development Grants shall be payable from and secured
solely and only by the Developer Tax Increments paid to City that, upon receipt,
shall be deposited and held in a special account created for such purpose and
designated as the Flexsteel TIF Account of City. City hereby covenants and agrees
to maintain its TIF ordinance in force during the Term and to apply the incremental
taxes collected in respect of the Property and Minimum Improvements and
allocated to the Flexsteel TIF Account to pay the Economic Development Grants,
as and to the extent set forth in Section 3.1 (1) hereof. The Economic Development
Grants shall not be payable in any manner by other tax increments revenues or by
general taxation or from any other City funds. City makes no representation with
respect to the amounts that may be paid to Developer as the Economic
Development Grants in any one year and under no circumstances shall City in any
manner be liable to Developer so long as City timely applies the Developer Tax
Increments actually collected and held in the Flexsteel TIF Account (regardless of
5
the amounts thereof) to the payment of the Economic Development Grants to
Developer as and to the extent described in this Section.
(4) City shall be free to use any and all tax increment revenues collected in
respect of other properties within the Project Area, or any available Developer Tax
Increments resulting from the termination or reduction of the annual Economic
Development Grants under this Section 3.1 hereof, for any purpose for which such
tax increment revenues may lawfully be used pursuant to the provisions of the
Urban Renewal Law, and City shall have no obligations to Developer with respect
to the use thereof.
(5) All of City's obligations under this Agreement, including but not limited to
City's obligation to pay the Economic Development Grants to Developer, shall be
subject to City having completed all hearings and other procedures required to
amend the Urban Renewal Plan to describe the Urban Renewal Project being
undertaken in accordance with this Agreement.
3.2 Site Preparation. City reserves the right to approve the design and specifications
for any site preparation work. City shall not remove any dirt from the Property prior to
Closing, to the end that Developer may utilize dirt presently stored on the Property in
Developer's grading of the Property.
SECTION 4. [Intentionally deleted]
SECTION 5. NON-APPROPRIATION / LIMITED SOURCE OF FUNDING.
5.1 Non-Appropriation. Notwithstanding anything in this Agreement to the contrary,
the obligation of City to pay any installment of the Economic Development Grants from
the pledged tax increment revenues shall be an obligation limited to currently budgeted
funds, and not a general obligation or other indebtedness of City or a pledge of its full
faith and credit within the meaning of any constitutional or statutory debt limitation, and
shall be subject in all respects to the right of non-appropriation by the City Council of City
as provided in this Section. City may exercise its right of non-appropriation as to the
amount of the installments to be paid during any fiscal year during the Term of this
Agreement without causing a termination of this Agreement. The right of non-
appropriation shall be exercised only by resolution affirmatively declaring City's election
to non-appropriate funds otherwise required to be paid in the next fiscal year under this
Agreement.
In the event the City Council of City elects to not appropriate sufficient funds in the budget
for any future fiscal year for the payment in full of the installments on the Economic
Development Grants due and payable in that future fiscal year, then City shall have no
further obligation to Developer for the payment of any installments due in that future fiscal
year which cannot be paid with the funds then appropriated for that purpose.
6
5.2 The right of non-appropriation reserved to City in this Section is intended by the
parties, and shall be construed at all times, so as to ensure that City's obligation to pay
future installments on the Economic Development Grants shall not constitute a legal
indebtedness of City within the meaning of any applicable constitutional or statutory debt
limitation prior to the adoption of a budget which appropriates funds for the payment of
that installment or amount. In the event that any of the provisions of this Agreement are
determined by a court of competent jurisdiction to create, or result in the creation of, such
a legal indebtedness of City, the enforcement of the said provision shall be suspended,
and the Agreement shall at all times be construed and applied in such a manner as will
preserve the foregoing intent of the parties, and no event of default shall be deemed to
have occurred as a result thereof. If any provision of this Agreement or the application
thereof to any circumstance is so suspended, the suspension shall not affect other
provisions of this Agreement which can be given effect without the suspended provision,
and to this end the provisions of this Agreement are severable.
SECTION 6. COVENANTS OF DEVELOPER.
6.1 Job Retention. During the Term of this Agreement, Developer shall comply with
the following employment-related covenants:
Developer represents that the number of fulltime equivalent (FTE) employees
employed by Developer in Dubuque, Iowa, on the Closing Date is 218. Developer
shall maintain during the Term of this Agreement at the Dubuque Industrial Center
South facility 200 FTE employees. FTE employees shall be calculated by adding
fulltime and part-time employees together using 2080 hours per year as a FTE
employee. For the positions that Developer fails to maintain for any year during
the Term of this Agreement, the semi-annual Economic Development Grants for
such year under Section 3.2 shall be reduced by the percentage that the number
of such positions bears to the total number of positions required to be maintained
by this Section 6.1 . (For example, if the certification shows 184 FTE during any
year of the Term, the semi-annual Economic Development Grants would be 92.0%
(184/200) of the Developer Tax Increments received by City which would be paid
by City to Developer). The reduction of the semi-annual Economic Development
Grants shall be the City's sole remedy for the failure of Developer to meet the job
creation requirements of this subsection 6.1 .
6.2 Certification. To assist City in monitoring the performance of Developer hereunder,
on the Closing Date and again as of January 1 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 FTE positions employed by Developer at the
Dubuque Industrial Center South facility, 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 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. Such certificate shall be provided by March 1 of each year thereafter
during the Term of this Agreement.
6.3 Books and Records. During the Term of this Agreement, Developer shall keep at
all times 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.
6.4 Real Property Taxes. From and after the Closing Date, Developer shall pay or
cause to be paid, when due and before delinquency, 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 another person pursuant to the provisions of this
Agreement.
6.5 No Other Exemptions. During the Term of this Agreement, Developer agrees not
to apply for any state or local property tax exemptions which are available with respect to
the 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.
6.6 Insurance Requirements.
(1) Developer shall provide and maintain or cause to be maintained at all times
during the process of constructing the Minimum Improvements (and, from time to
time at the request of City, furnish City with proof of insurance in the form of a
certificate of insurance for each insurance policy):
All risk builder's risk insurance, written on a Completed Value Form in an
amount equal to one hundred percent (100%) of the replacement value
when construction is completed.
(2) Upon completion of construction of the Minimum Improvements and up to
the Termination Date, 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) all risk property insurance
against loss and/or damage to the 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 Minimum Improvements (excluding foundation and excavation
costs and costs of underground flues, pipes, drains and other uninsurable items)
8
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.
(3) Developer agrees to notify City immediately in the case of damage
exceeding $200,000.00 in amount to, or destruction of, the Minimum
Improvements or any portion thereof resulting from fire or other casualty. The net
proceeds of any such insurance (the 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.
6.7 Preservation of Property. During the Term of this Agreement, Developer shall
maintain, preserve and keep, or cause others to maintain, preserve and keep, Minimum
Improvements in good repair and working order, ordinary wear and tear excepted, and
from time to time shall make all necessary repairs, replacements, 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.
6.8 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, gender identity, national origin, age or disability.
6.9 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 a decision-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.
6.10 Transferability. During the Term of this Agreement, this Agreement may not be
assigned and the Property and any portion of the Property may not be sold or otherwise
transferred by Developer without the prior written consent of City in City's sole discretion.
City has no obligation to consent to any assignment or sale.
9
6.11 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 facility is in full compliance with the Urban Renewal
Plan and Developer agrees to comply with any amendments to 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, gender identity, 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).
6.12 Release and Indemnification Covenants.
(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 and covenants and agrees that the Indemnified Parties
shall not be liable for, and agrees 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.
10
(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.
6.13 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.
SECTION 7. EVENTS OF DEFAULT AND REMEDIES.
7.1 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.
(2) Failure by Developer to cause the construction of the Minimum
Improvements to be commenced and completed pursuant to the terms, conditions
and limitations of this Agreement.
(3) Transfer of any interest by Developer in any portion of the Property or the
Minimum Improvements in violation of the provisions of this Agreement.
(4) Failure by Developer to substantially observe or perform any other material
covenant, condition, obligation or agreement on its part to be observed or
performed under this Agreement.
7.2 Remedies on Default by Developer. Whenever any Event of Default referred to in
Section 7.1 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 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
ii
within sixty (60) days and the 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 Developer, deemed adequate by City, that the Developer will
cure its default and continue its performance under this Agreement;
(2) Until the Closing Date, City may cancel and rescind this Agreement;
(3) City may withhold the Certificate of Completion; or
(4) 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.
7.3 Revesting of Title.
(1) Re-vesting Title in City Upon Happening of Event Subsequent to
Conveyance to Developer and Prior to Issuance of Certificate of Completion. In
the event that, subsequent to Closing and prior to receipt by Developer of the
Certificate of Completion, an Event of Default under Section 7.1 (1) through (4) of
this Agreement occurs and is not cured within the times specified in Section 7.2,
then City shall have the right to re-enter and take possession of Property and any
portion of the Minimum Improvements thereon and to terminate Developer's
estate, it being the intent of this provision, together with other provisions of this
Agreement, that the conveyance of Property to Developer was made upon the
condition that, in the event of default under Section 7.1 (1) through (4) on the part
of Developer and failure on the part of Developer to cure such default within the
period and in the manner stated herein, City may declare a termination of this
Agreement in favor of City of the title and of all Developer's rights and interests in
and to the Property, and that such title and all rights and interests of Developer,
and any assigns or successors in interests of Developer, and any assigns or
successors in interest to and in Property, shall revert to City (subject to the
provisions of Section 7.3 of this Agreement), but only if the events stated in Section
7.1 of this Agreement have not been cured within the time period provided above,
or, if the events cannot be cured within such time periods, Developer does not
provide assurance to City, reasonably satisfactory to City, that the events will be
cured as soon as reasonably possible.
7.4 Resale of Reacquired Property: Disposition of Proceeds. Upon the re-vesting in
City of title to the Property as provided in Section 7.3 of this Agreement, City shall,
pursuant to its responsibility under law, use its best efforts to resell the Property or part
thereof as soon and in such manner as City shall find feasible and consistent with the
objectives of such law and of the Urban Renewal Plan to a qualified and responsible party
or parties (as determined by City in its sole discretion) who will assume the obligation of
12
making or completing Minimum Improvements or such other improvements in their stead
as shall be satisfactory to City and in accordance with the uses specified for the Property
or part thereof in the Urban Renewal Plan. The proceeds thereof shall be applied:
(1) First to reimburse City and County for all allocable costs and expenses
incurred by City and County, including but not limited to salaries of personnel, in
connection with the recapture, management and resale of the Property or part
thereof (but less any income derived by City from the Property or part thereof in
connection with such management); any payments made or necessary to be made
to discharge any encumbrances or liens existing on the Property or part thereof at
the time of re-vesting of title thereto in City or to discharge or prevent from attaching
or being made any subsequent encumbrances or liens due to obligations, default
or acts of Developer, its successors or transferees any expenditures made or
obligations incurred with respect to the making or completion of the Minimum
Improvements or any part thereof on the Property or part thereof, and any amounts
otherwise owing to City (including water and sewer charges) by Developer and its
successors or transferees; and
(2) Second, to reimburse Dubuque County, Iowa up to the amount equal to the
sum of the Purchase Price paid by Developer to Dubuque County for the Property
less any funds recovered by Dubuque County under the terms of the
Redevelopment Project Agreement dated by and among the City of
Dubuque, Iowa, Dubuque Initiatives, and Flexsteel Industries, Inc.; and
(3) Third, to reimburse Developer up to an amount equal to the cash actually
invested by Developer in making any of the Minimum Improvements on the
Property.; and
(4) The balance, if any, to City.
7.5 No Remedy Exclusive. 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.
7.6 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.
7.7 Agreement 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
13
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.
7.8 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 performance under this Agreement until it receives assurances from City,
deemed adequate by Developer, that City will cure its default and continue its
performance under this Agreement.
SECTION 8. GENERAL TERMS AND PROVISIONS.
8.1 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 having been deposited in
any U.S. Postal Service and sent by registered or certified mail, postage prepaid,
addressed as follows:
(1) If to Developer:
Flexsteel Industries, Inc.
Attn: CFO and Secretary385 Bell Street
Dubuque, Iowa 52001
Phone: (563) 556-7730
With copy to:
Flexsteel Industries, Inc.
In-House Corporate Counsel
385 Bell Street
Dubuque, IA 52001
Phone: (563) 556-7730
(2) If to City:
City Manager
50 W. 13th Street
Dubuque, Iowa 52001
Phone: (563) 589-4110
Fax: (563) 589-4149
With copy to:
14
City Attorney
City Hall
50 W. 13th Street
Dubuque, Iowa 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.
8.2 Binding Effect. This Agreement shall be binding upon and shall inure to the benefit
of City and Developer and their respective successors and assigns.
8.3 The Parties agree that Dubuque County, Iowa is an intended Third Party
Beneficiary under Section 7.4.
8.4 Term; Termination Date. The Term of this Agreement and the rights and
obligations of the parties hereunder shall commence upon execution by both parties and
shall terminate at midnight on May 1 , 2030 (the Termination Date).
8.5 Execution By Facsimile. The parties agree that this Agreement may be transmitted
among them by facsimile machine or electronic transmission. The parties intend that the
faxed or electronic transmission signatures constitute original signatures and that a faxed
or electronically transmitted Agreement containing the signatures (original or faxed) of all
the parties is binding on the parties.
8.6 Memorandum of Development Agreement. City shall promptly record a
Memorandum of Development Agreement in the form attached hereto as Exhibit E in the
office of the Recorder of Dubuque County, Iowa. Developer shall pay the costs for so
recording.
8.7 Subject to Other Transactions. The closing of the transaction contemplated by this
Agreement is subject to the closing of all of the following transactions on or before the
Closing Date and in the event any of such transactions does not so close, then this
Agreement shall be null and void:
(1) That certain Offer to Buy and Acceptance dated the day of
2017, between the City of Dubuque and Dubuque County, Iowa
relating to Lot 4 of Dubuque Industrial Center South First Addition in the City of
Dubuque, Iowa;
(2) That certain Offer to Buy and Acceptance dated the day of
2017, between Dubuque County, Iowa and Blue Steel 1031 LLC
thereof relating to Lot 4 of Dubuque Industrial Center South First Addition in the City
of Dubuque, Iowa;
15
(3) That certain Redevelopment Agreement dated the day of
2017, between and among the City of Dubuque, Dubuque Initiatives,
and Flexsteel Industries, Inc.
IN WITNESS WHEREOF, City has caused this Agreement to be duly executed in
its name and behalf by its Mayor and attested to by its City Clerk and Developer has
caused this Agreement to be duly executed.
CITY OF DUBUQUE, IOWA FLEXSTEEL INDUSTRIES, INC.
By: By:
Roy D. Buol, Mayor Timothy E. Hall, SVP Finance,
CFO and Secretary
By:
Kevin S. Firnstahl
City Clerk
16
LIST OF EXHIBITS
Exhibit A Urban Renewal Plan
Exhibit B Plat
Exhibit C City Attorney Certificate
Exhibit D Opinion of Counsel to Developer
Exhibit E Memorandum of Development Agreement
Exhibit F City Certificate
Exhibit G Certificate of Completion
17
EXHIBIT A
URBAN RENEWAL PLAN
A copy of the Plan and amendments is on file in the Office of the City Clerk,
City Hall, 50 West 13th Street, Dubuque, Iowa
AMENDED and RESTATED
URBAN RENEWAL PLAN
Dubuque Industrial Center Economic Development District
City of Dubuque, Iowa
Trs Amermed and Round! Ul Reposed Plat pmnJg
W the conanntd demormntt a the oimuwe nominal
Cama Frames lleveY:gmntl real eylrcmM
rb,bcs i b3 Resmuon 13689 one sty canter more
cry of owwe. loan be May z man and nemal
amended ad passed b3 postpone aea99 of l3eavnber
17. 1998, Resmuant 14297 of Ppm 3, 1997, Resource
nasi on November n, 1907.Resonant 15 Son January
], 2008, Rewluam 18198 of Mach 17, Maur Scandal
18988 of Ppnl 7,2008.RzwLbon 8]-11 on Mame],2011,
Resmuao 171-13 on Jume 3, 2013, ResAre n 19]-15 of
Lre 1,2015,and Reams non 399-15 on September 8,2815
ohm 4 ue does ozvrm�as mremaa
Voam ZIM53
18
EXHIBIT B
PLAT
A copy of the Plat is on file in the Office of the County Recorder,
720 Central Avenue, Dubuque, Iowa 52001
Instrument No. 2014-00001397
19
FINAL PLAT
DUBUQUE INDUSTRIAL CENTER SOUTH FIRST ADDITION IN THE CITY OF DUBUQUE, IOWA
W1/4 CORNER LOT 1-1-2-
SEC. 31 NO CAP LOT 1 I 1-i-2 OF
COMMERCIAL PARK #4
SEIPPEL ROAD
-W1/4-NW1/4.
SEC. 31.
N87'58.56"E
7
NW COR. LOT 1-1
S8758'56'W 646.42'
NOT TO SCALE
C!
SOUTH
LOT 1-1-1-1-1-1-2
OF SW1 /4-NWI /4, SEC. 31
1274.12'
NOT TO SCALE,
NORTH
GRAPHIC SCALE
200 400
LOT 2
15.47 ACRES
MATCH
LOT 1
21.29 ACRES
0''
L01 8
K 1N0. '1•41ND D
1 "�20W
587'58'29"W
227.94'
NW CORNER NE1/4-SW1/4
CAP N0. 13146
47
Np'
see'
cook ��tpS;per
LOT 2
HILKIN ACRES
LOT 2-1
SOUTH FORK IND. SUB. N0. 1
NO CAP
B LOT B
7.37 ACRES
STORM WATER
IE MANAGEMENT
00 455.16
509. ?N 964.4 0,009 2 )55 0. `
79.::4.09:0.9.0.,87.
9'O1 .25E 1008• •
843.11' S61'33'04'E
- 124.10' r0
NO CAP
C
LOT 3
6.90 ACRES
lA1-
`�i SOV�I f0RK 11005
h rn
1,01 1'4 1�
UNE SEE SHEET 3 OF 10 SAME. 1•
1' 200'
DRAWING MAY HAW BEEN REDUCED
FFOOR AS -CONSTRUCTED
CONTOURS SEE SHEETS
8 THROUGH 10.
FORIEL
FOPROPOSED EASEMENTS
SEE SHEETS 5 THROUGH 7.
ROW NOT TO SCALE
PARTNERS
RD.
Cl 1590.49' 1050.00'
CIA 145.73' 1050.00'
C18 1444.76' 1050.00'
C2 204.07' 250.00'
C3 1398.97 1150.00'
C3A 858.46' 1150.00'
C38 434.57' 1150.00'
C3C 105.76' 1150.00'
DELLS. 1
86'47'20' N57'23'43'W
07'57'07 P417'58'3TW
78'50'13' P461'22'17W
46'46'09' N3910'32'1
69'41'59' S66'01'33'E
42'46'47 S52'33'58'E
21'39'03' S84'46'52"E
0516'09' N81'45'30'E
LOT 4
26.79 ACRES
g4DRD LPNGIM
1442.74'
145.61'
1333.46'
198.45'
1314.29'
838.84'
413.98'
105.72'
iii
5
r}ownu ornn.unn
SIC T w. 32-u-1
o1m
rz +o- a _ 7 w q
v�uA wk
CAC 110. 110113-01
FINAL PLAT
DUBUQUE INDUSTRIAL CENTER SOUTH FIRST ADDITION IN THE CITY OF DUBUQUE, IOWA
NW CORNER SW1/4-SW1/4 SEC. 31
NO CAP MATCH LINE SEE SHEET 2 OF 10
LOT 5
12.68 ACRES
4.20
1.19 1.18
Ses
SW COR. SEC. 31
SW COR. LOT 1-2
LOT 1
LANDFILL NORTH SUBDIVISION
ZONE A
SEE NOTE
(1114.9')
ZZONNEA�F1000 LIMITS PER NFIP FEMA FIRM NO.
19061C0332E EFFECTIVE DATE OF OCT. 18, 2011
C4
C5
LEtli
88.58'
62.72'
83.50'
58.50'
QELis fd14Sa
60'46'50' N28'56'54W
6125'41' N28'37'28'W
LOT 3
6.90 ACRES
N86'22'13'E
433.49'
S8413'561
2.33'
(
(S14'44'32'E)
(48.33')
S137:".5j8.1 "WI
QIORD LENGTH
84.48'
59.76'
[73
N
P
oN
N
Cr
STS+S? 2T
246.59• C
704.72
p6 �
^y ly `CP
1tis01'3.8° • VAS fig.
�Fd�K1"t LOT A
•" T ��p^ 5(y.1 80.84 ACRES
N O
STORM WATER MANAGEMENT
.%115 r\ AND OPEN RECREATION
LOT 4
26.79 ACRES
502-°2-
15
S89'01'02'W 420.28'
N88'061 9 -W 395.;
\
(N86'53'17'W 383.78')
EXISTNG 30' SANITARY
SEWER EASEMENT PER
RECORD DOC. /7084-00
e)Q
�S"qC g0, \ - \\
OOC SF�[.Uj/Vrp E �� G
N 1/4 CORNER
SEC. 6. T88N. R2E
0
1-
•(Sg4'13400 63
(398.73') g
7
IC
_ —/
587'41'33'W 743.66'
5.23' _ LOT 1-2-1 N1/2 OF SEC. 6, T88N. R2E
SWI/4 OF NWI/4 OF LOT 1 OF SWI/4
OF NW1/4 ALL IN SEC. 6, T88N. R2E
AND LOT 2 LANDFILL NORTH SUBDIVISION NORTH
FOR AS -CONSTRUCTED GRAPHIC SCALE
CONTOURS SEE SHEETS I 0 200 400
8 THROUGH 10.
FOR PROPOSED EASEMENTSI
SEE SHEETS 5 THROUGH 7.
i' - 200'
DRAWING MAY HAVE BEEN
REDUCED
1'w
a.rnun
•Ac
WM
Z.,"":717 T 1,0. 3}2�IA---o13
ay., "o. IY (!
. i' p•q� MT
FINAL PLAT
DUBUQUE INDUSTRIAL CENTER SOUTH FIRST ADDITION IN THE CITY OF DUBUQUE, IOWA
LINE. RFARING
11 S60'04'33 -E
L2 S45'04'01'E
L3 S61'56'34 -E
L4 S45'20'57 -E
15 S23 -53'09-W
L6 S50'34'17 -E
L7 527'38'04-E
L8 S7412'25 -E
L9 N15'47'26 -E
110 N6213'37'E
111 N79'3742 -E
L12 NO2'05'22-E
113 57018'49-E
114 N06'32'57E
115 N26'05'30 -E
116 S20'51'49'E
117 S58'41'07E
118 S78'05'54 -E
L19 582'22'48-E
L20 S65'03'08'E
121 S74'51'53 -E
122 N68'04'02 -W
DISTANCE
270.21'
170.10'
127.40'
256.54'
38.67 (39.41')
210.17
721.76'
34.22'
10.00'
2.15'
171.81'
132.95'
182.63'
237.51'
193.25'
137.24'
69.99'
50.58'
104.93'
144.13'
134.79'
224.59'
FOR AS -CONSTRUCTED
CONTOURS SEE SHEETS
8 THROUGH 10.
IEL
FFOOR PROPOSED EASEMENTSI
SEE SHEETS 5 THROUGH 7.
NORTH
GRAPHIC SCALE
0 200 400
1' - 200'
DRAWING NAY HAVE BEEN REDUCED
a:
i
LOT 2-2
SOUTH FORK IND. SUB. NO. 1
589'07'32-E
298.33'
Ij
n
•Q,
<y .
9� O� 0.
(0`
.S1
N3317'06'EJ / • . q; " I�
95.33'
/4061)
L5p6 c
(S82'0751'W 402.42') /2
ZONE A r
LOT A `SEE NOTE /
3/4-
80.84 ACRES
STORM WATER \y �
MANAGEMENT
Wl
(S1 ` X6'1 .
tri
/N87'22'34 -E
442.17 -�
367.17'
75.00
79.50
YELLOW CAP
NO. 13146
LOT 1-2 OF SW1/4
OF SE1 /4 SEC. 31.
189N, R2E
AND OPEN /
R�ON
EXISTING 50' UNDERGROUND
GAS EASEMENT PER RECORD
•
DOC / 7172-99
T
S1/4 CORNER -� x(178'36'56 )
SEC. 31, \ (175'07'59-)
89N R2E �-
T 52110'
9417,8'19-W
9.b6'
rr 1-2-1 N1/2
ROD
LOT 2-2 OF SW1/4
OF SE1/4 SEC. 31,
189N. R2E
�- 3/4' REBAR
LOT 3-2 OF SW1/4
++� OF 5E1/4 SEC. 31.
T89N. R2E
SE COR. LOT 1-2
OF SEC. 6, 188N, R2E
cr.
W
d
EC
YELLOW CAP
h 13146
1n 0
Z
N 2
O
U
WO WNW.
// “:
\vatw-e "v••• 13t
File Number 20
EXHIBIT C
CITY ATTORNEY'S CERTIFICATE
Development Agreement City and Flexsteel 051117bal
BARRY A. LINDAHL , ESQ. Tr C=OF
CITY ATTORNEY DUB E
(DATE)
RE:
Dear
I have acted as counsel for the City of Dubuque, Iowa, in connection with the execution
and delivery of a certain Development Agreement between
(Developer) and the City of Dubuque, Iowa (City) dated for reference purposes the
day of 20_
The City has duly obtained all necessary approvals and consents for its execution,
delivery and performance of this Agreement and has full power and authority to execute,
deliver and perform its obligations under this Agreement, and to the best of my
knowledge, the representations of the City Manager in his letter dated the _ day of
20_, are correct.
Very sincerely,
Barry A. Lindahl, Esq.
City Attorney
BAL:tIs
24
EXHIBIT D
OPINION OF DEVELOPER'S COUNSEL
25
Mayor and City Councilmembers
City Hall, 13th 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 corporation 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 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,
26
EXHIBIT E
MEMORANDUM OF DEVELOPMENT AGREEMENT
27
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 FLEXSTEEL INDUSTRIES, INC. was made
regarding the following described premises:
Lot 4 of Dubuque Industrial Center South First Addition in the City of
Dubuque, Iowa
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
By:
Kevin S. Firnstahl, City Clerk
28
STATE OF IOWA
ss:
DUBUQUE COUNTY
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 Kevin S. Firnstahl, 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
. ss:
DUBUQUE COUNTY
On this day of , 20before 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.
Notary Public, State of Iowa
29
EXHIBIT F
CITY CERTIFICATE
30
THEcr OF
DUB E
0 Manager's Office
5
50 West 13th Street �t6�✓r�(/y.vr+C,
Dubuque,Iowa 52001-4864
(563)589-4110 phone
(563)589-4149 fax
ctymgr@cityofdubuque.org
(DATE)
Dear
I am the City Manager of the City of Dubuque, Iowa and have acted in that capacity in
connection with the execution and delivery of a certain Development Agreement between
(Developer) and the City of Dubuque, Iowa (City) dated for reference
purposes the _ day of 20_.
On behalf of the City of Dubuque, I hereby represent and warrant to Developer that:
(1) City has duly obtained all necessary approvals and consents for its
execution, delivery and performance of this Agreement, and has full power and
authority to execute, deliver and perform its obligations under this Agreement.
City's attorney shall issue a legal opinion to Developer at time of closing confirming
the representation contained herein, in the form attached hereto as Exhibit C.
(2) City shall exercise its best efforts to resolve any disputes arising during the
development process in a reasonable and prompt fashion.
(3) The Property is presently zoned to accommodate Developer's intended
improvements and the manufacturing of upholstered furniture and steel products.
Sincerely,
Michael C. Van Milligen
City Manager
MCVM:jh
31
EXHIBIT G
CERTIFICATE OF COMPLETION
32
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
CERTIFICATE OF COMPLETION
WHEREAS, the City of Dubuque, Iowa (City), and Flexsteel Industries, Inc.
(Developer) have entered into a Development Agreement dated as of[Date], with respect
to certain real property located within the Dubuque Industrial Center Economic
Development District and as more particularly described as follows:
Lot 4 of Dubuque Industrial Center South First Addition in the City of Dubuque,
Iowa
(the "Property"); and
WHEREAS, said Agreement contains certain covenants and conditions with
respect to the development of the Property, and obligates Developer to construct certain
Minimum Improvements in accordance with the Agreement; and
WHEREAS, Developer has performed said covenants and conditions insofar as
they relate to the construction of the Minimum Improvements in a manner deemed
sufficient by City to permit the execution and recording of this certification; and
NOW, THEREFORE, pursuant to Section 2.4 of the Agreement, this is to certify
that all covenants and conditions of the Agreement with respect to the obligations of
Developer, and its successors and assigns, to construct the Minimum Improvements on
the Property and pay for the same have been completed and performed by Developer to
the satisfaction of City and such covenants and conditions are hereby terminated.
The Recorder of Dubuque County is hereby authorized to accept for recording and to
record the filing of this instrument, to be a conclusive determination of the satisfaction of
the covenants and conditions of said Agreement which would have resulted in a forfeiture
by Developer and right of City to re-enter and take possession of the Property as set forth
in said Agreement if such covenants and conditions had not been satisfied, and that said
Agreement shall otherwise remain in full force and effect.
CITY OF DUBUQUE, IOWA
33
By:
Michael C. Van Milligen, City Manager
STATE OF IOWA )
SS
COUNTY OF DUBUQUE )
On this day of 120 , before me, the undersigned, a Notary
Public in and for the State of Iowa, personally appeared Michael C. Van Milligen, to me
personally known, who, being by me duly sworn, did say that he is the City Manager of
the City of Dubuque, Iowa, a municipal corporation, and that the instrument was signed
on behalf of the corporation, and Michael C. Van Milligen acknowledged the execution of
the instrument to be his voluntary act and deed.
Notary Public in and for said State
34
OFFER TO BUY REAL ESTATE AND ACCEPTANCE (THE AGREEMENT)
TO: City of Dubuque, Iowa, Seller
SECTION 1. REAL ESTATE DESCRIPTION. Dubuque County, Iowa (Buyer) offers to
buy all of Seller's right, title and interest in and to the real estate in Dubuque County,
Iowa, described as follows:
Lot 4 of Dubuque Industrial Center South First Addition in the City of
Dubuque, Iowa
and
A parcel of land of 3.88 acres more or less on Seippel Road in the Dubuque
Industrial Center West Urban Renewal District of the City of Dubuque, as
shown on Exhibit A attached hereto, subject to survey and platting the cost
of which will be paid by Buyer
(together, Real Estate)
together with any easements and appurtenant servient estates, but subject to the
following:
a. any zoning and other ordinances;
b. any covenants of record;
C. any easements of record for public utilities, roads and highways located
on the Real Estate.
SECTION 2. PURCHASE PRICE.
2.1 The Purchase Price for the Real Estate shall be $3,320,000 and shall be paid as
follows:
(1) $1 ,320,000 at the time of closing on the Closing date described in Section 5
hereof (of which $660,000 shall be retained by Seller), and the balance of
$2,000,000 as follows:
(2� $300,000 on or before the 15t day of July, 2018, $300,000 on or before the
15 day of July of each year thereafter for five (5) years, and the balance of
$200,0000 on or before July 1 , 2024.
2.2 The Purchase Price (less the $660,000 retained by Seller) shall be for Demolition
Costs for the Redevelopment Property as such terms are defined in the Redevelopment
Project Agreement by and among the City of Dubuque, Iowa, Dubuque Initiatives, and
Flexsteel Industries, Inc., dated the _ day of , 2017 (Redevelopment
Agreement).
051117bal
(1) In the event that the Redevelopment Property is sold prior to the payment
by County of all Purchase Price payments to City, after payment by and
reimbursement of Dubuque Initiatives (Initiatives) from the City Escrow as
provided in the Redevelopment Agreement of all Reimbursable Expenses and
Costs and Recurring Expenses (as such terms are defined in the Redevelopment
Agreement), County may discontinue such Purchase Price payments to City.
(2) In the event that all structures on the Redevelopment Property are
properly demolished, as determined by agreement of Initiatives and City, and
prior to the payment by County of all Purchase Price payments to City, County
shall be required to pay to City only such funds as are necessary for payment by
and reimbursement of Initiatives from the City Escrow as provided in the
Redevelopment Agreement of all Reimbursable Expenses and Costs and
Recurring Expenses, pursuant to statements provided by City to County.
(3) In the event prior to the payment by County of all Purchase Price
payments to City, sufficient funds are received from grants or funds from sources
other than the parties to the Redevelopment Agreement for Demolition Costs as
provided in the Redevelopment Agreement, County shall be required to pay to
City only such funds as are necessary for payment by and reimbursement of
Initiatives from the City Escrow as provided in the Redevelopment Agreement of
all Reimbursable Expenses and Costs and Recurring Expenses, pursuant to
statements provided by City to County.
2.3 Buyer may prepay all or part of the balance owed under this Agreement at any
time without penalty.
2.4 Non-Appropriation.
(1) Notwithstanding anything in this Agreement to the contrary, the obligation
of County to pay any installment of the Purchase Price to City shall be an
obligation limited to currently budgeted funds, and not a general obligation or
other indebtedness of County or a pledge of its full faith and credit within the
meaning of any constitutional or statutory debt limitation, and shall be subject in
all respects to the right of non-appropriation by the Board of Supervisors of
County as provided in this Section. County may exercise its right of non-
appropriation as to the amount of the installments to be paid during any fiscal
year during the term of this Agreement without causing a termination of this
Agreement. The right of non-appropriation shall be exercised only by resolution
affirmatively declaring County's election to non-appropriate funds otherwise
required to be paid in the next fiscal year under this Agreement.
(2) In the event the Board of Supervisors of County elects to not appropriate
sufficient funds in the budget for any future fiscal year for the payment in full of
the installment due and payable in that future fiscal year, then County shall have
2
no further obligation for the payment of any installments due in that future fiscal
year which cannot be paid with the funds then appropriated for that purpose.
(3) The right of non-appropriation reserved to County in this Section is
intended by the parties, and shall be construed at all times, so as to ensure that
County's obligation to pay future installments to City shall not constitute a legal
indebtedness of County within the meaning of any applicable constitutional or
statutory debt limitation prior to the adoption of a budget which appropriates
funds for the payment of that installment or amount. In the event that any of the
provisions of this Agreement are determined by a court of competent jurisdiction
to create, or result in the creation of, such a legal indebtedness of County, the
enforcement of the said provision shall be suspended, and the Agreement shall
at all times be construed and applied in such a manner as will preserve the
foregoing intent of the parties, and no event of default shall be deemed to have
occurred as a result thereof. If any provision of this Agreement or the application
thereof to any circumstance is so suspended, the suspension shall not affect
other provisions of this Agreement which can be given effect without the
suspended provision, and to this end the provisions of this Agreement are
severable.
2.5 Subject to all of the terms and conditions herein.
SECTION 3. REAL ESTATE TAXES. Taxes for the fiscal year in which the closing
takes place shall be paid by Seller prorated to the date of possession. Seller shall also
pay any unpaid real estate taxes for prior fiscal years.
SECTION 4. SPECIAL ASSESSMENTS. Seller shall pay all special assessments
which are a lien as of the date of closing.
SECTION 5. POSSESSION AND CLOSING. If Seller timely performs all obligations,
and all contingencies are met or waived, possession of the Real Estate shall be delivered
to Buyer on or before August 1 , 2017 (the Closing Date), or such other date as the parties
may agree in writing.
SECTION 6. ABSTRACT AND TITLE. Seller, at its expense, shall promptly obtain an
abstract of title to the Real Estate continued through the date of acceptance of this
Agreement which shall show merchantable title in Seller in conformity with this
agreement, Iowa law and Title Standards of the Iowa State Bar Association. At the
closing, the abstract shall become the property of the Buyer. Seller shall pay the costs of
any additional abstracting and title work due to any act or omission of Sellers.
SECTION 7. DEED. At the closing, Seller shall convey the Real Estate to Buyer, by
Warranty Deed.
SECTION 8. TIME IS OF THE ESSENCE. Time is of the essence in this contract.
3
SECTION 9. REMEDIES OF THE PARTIES. The sole remedy of both Buyer and
Seller in the event of default is for breach of contract. Judgment for costs and attorney
fees may be as permitted by law.
SECTION 10. TIME FOR ACCEPTANCE. If this Agreement is not accepted by Seller
on or before Noon on June 5, 2017, it shall be void.
SECTION 11. OTHER PROVISIONS.
11 .1 This Agreement is subject to final approval by the City Council in its sole
discretion.
11 .2 Buyer, its counsel, accountants, agents and other persons authorized by Buyer,
shall have full and continuing access to the Real Estate and all parts thereof, upon
reasonable notice to Seller for the purpose of inspecting, surveying, engineering, test
boring, performance of environmental tests and such other work as Buyer shall consider
appropriate, provided that Buyer shall hold Seller harmless and fully indemnify Seller
against any damage, claim, liability or cause of action arising from or caused by the
actions of Buyer, its agents, or representatives upon the Real Estate (except for any
damage, claim, liability or cause of action arising from conditions existing prior to any
such entry upon the Real Estate), and shall have the further right to make such inquiries
of governmental agencies and utility companies, etc. and to make such feasibility
studies and analyses as Buyer considers appropriate.
11 .3 Environmental Provisions.
(1) Seller warrants to the best of its knowledge and belief that there are no
abandoned wells, solid waste disposal sites, hazardous wastes or substances,
underground storage tanks, burial sites or private wastewater disposal systems
located on the Real Estate, the Real Estate does not contain radon gas,
asbestos or asbestos containing building materials, or urea-formaldehyde foam
insulation, and Sellers have done nothing to cause or allow contamination of the
Real Estate with hazardous wastes, substances, or pollutants. Seller warrants to
the best of its knowledge and belief that the Real Estate is not subject to any
local, state, or federal judicial or administrative action, investigation or order
regarding any environmental matter. Seller shall provide Buyer with a properly
executed Groundwater Hazard Statement showing no wells, solid waste disposal
sites, hazardous wastes, underground storage tanks, private burial sites or
private wastewater disposal systems on the Real Estate which shall be
considered a warranty and representation by Seller to Buyer.
(2) Following closing, should the Buyer learn that the environmental condition
of the Real Estate requires assessment and/or corrective action pursuant to
local, state or federal law, for matters first arising during the time period the Real
Estate was controlled by Seller, Seller shall take all action as may be required by
law to fully address the environmental condition and Seller shall indemnify and
4
hold harmless the Buyer from any claims and costs, including attorneys' fees and
consultants' fees, arising therefrom.
(3) The covenants and warranties in this Section shall survive closing.
11 .4 Until ten (10) days prior to closing, Buyer shall have the right to terminate this
agreement if environmental issues exist on the Real Estate that Buyer determines in its
sole discretion do not permit Buyer to use the Real Estate for its intended use. Prior to
terminating this Agreement pursuant to this Section, Buyer shall offer Seller the
opportunity to remediate the Real Estate to the satisfaction of Buyer in its sole discretion
and at Seller's sole cost.
11 .5 Buyer's purchase of Lot 4 of Dubuque Industrial Center South First Addition in the
City of Dubuque, Iowa is being undertaken pursuant to Iowa Code Section 403.12 in
order to facilitate a City urban renewal project. Buyer shall promptly transfer all right, title
and interest in and to such property to Flexsteel Industries, Inc. (or an affiliate thereof)
under the terms of the agreements described in Section 11 .6 hereof, after which such
property shall be used solely for the purpose of constructing an industrial manufacturing
facility of not less than 250,000 square feet of floor space along with the necessary site
work, machinery, and equipment at an estimated cost of approximately $25,000,000.
11 .6 The closing of the transaction contemplated by this agreement is subject to the
closing of all of the following transactions on or before the Closing Date and in the event
any of such transactions does not so close, then this agreement shall be null and void:
(1) That certain Offer to Buy and Acceptance dated the _ day of
2017, between Buyer and Flexsteel Industries, Inc. or an affiliate
thereof relating to Lot 4 of Dubuque Industrial Center South First Addition in the
City of Dubuque, Iowa;
(2) That certain Development Agreement Between the City of Dubuque, Iowa
and Flexsteel Industries, Inc. relating to the development of said Lot 4; and
(3) That certain Redevelopment Agreement as described in Section 2.2 hereof.
5
THIS AGREEMENT IS ACCEPTED
Dated: Dated:
BUYER SELLER
DUBUQUE COUNTY, IOWA CITY OF DUBUQUE, IOWA
By: By:
Jay Wickham, Chairperson Michael C. Van Milligen
City Manager
6
EXHIBIT A
25Mwa
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EXISTING LOT
L INE LOT C INDUSTRIAL
CENTER WEST T
2ND ADD. -1
LOT 1 INDUSTRiAL
-,M CENTER WEST _ —;CPOSED 3.88 i
SND =.DC 1ACRE LOT I
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Notice-These maps are compiled for assessment and tax information purposes from official county records. All map information shown is for the forgoing purpose and does not represent a survey of land.
7
1
1
Media Contact:
Greater
Rick Dickinson
Dubuque President&CEO
rickd@greaterdubuque.olg
DEVELOPMENT CORP. 563-557-9049
For Immediate Release May 12, 2017
Flexsteel Industries, Inc. Announces Expansion and Relocation Plans in Dubuque
Dubuque, Iowa, May 12, 2017— Flexsteel Industries, Inc. announced plans to relocate their manufacturing
operations to a new site in the Dubuque Industrial Center South. The company will invest over$28 Million to
construct and equip a new state-of-the-art, 250,000-square-foot facility. The current manufacturing plant is
located at 3400 Jackson Street.
This announcement comes as a welcome development after months of collaboration by private and public
entities. The hard work and partnership of Flexsteel management and employees, United Steelworkers Local
1861, Teamsters Local 120, Operating Engineers Local 234, the City of Dubuque, Dubuque County, Dubuque
Initiatives, and the Iowa Economic Development Authority once again demonstrates the power of
collaboration which is the secret sauce for a greater Dubuque.
Flexsteel Industries announced last September that they planned to close their 120-year-old manufacturing
plant in Dubuque. The furniture manufacturer cited the age of the facility, which dates back to 1897. As
Flexsteel began to review options for a new facility, the community also began its work on developing its case
for Dubuque as the best location for their new plant. Actions included:
• Providing a talented and stable workforce. All three unions negotiated and approved long-term
contracts should Dubuque be chosen for the new facility.
• Providing a world-class location. The City of Dubuque and Dubuque County entered into negotiations
to provide affordable space in the Dubuque Industrial Center South, ideal for Flexsteel's immediate
need for a 250,000-square-foot facility with room to grow in years to come.
• Providing financial support. Both the effort to build a new plant, retaining its existing workforce, and
the effort to return the old site in Dubuque's North End to a development-ready property is supported
by the City of Dubuque, Dubuque County, and the Iowa Economic Development Authority.
-MORE-
Schmid Innovation Center 900 Jackson Street Suite 109 Dubuque, Iowa 52001 563-557-9049 www.greaterdubuque.org
I
• Providing a dedicated non-profit to manage redevelopment efforts. Dubuque Initiatives, an
experienced non-profit dedicated to Downtown development, will hold, redevelop, and market the
Jackson Street property for projects in Dubuque's True North. This collaboration between public,
private, and non-profit partners is a considerable first step in efforts to revitalize the North End area
of the city. Greater Dubuque Development is committed to the economic development of this area
through the Dubuque's True North initiative.
Agreements are subject to final approval by the Dubuque County Board of Supervisors, Dubuque City Council,
and the Iowa Economic Development Authority Board of Directors.
Flexsteel Industries is America's finest designer, manufacturer, importer, and marketer of upholstered and
wood furniture for residential, office, hospitality, health care, and recreational vehicle markets. In FY 2016,
the company posted net income of$24.2 Million, on record net sales of$500 Million. Flexsteel Industries
corporate headquarters is located in the Port of Dubuque.
Greater Dubuque Development Corporation serves the Greater Dubuque region with focus on Business
Retention and Expansion, Workforce Solutions, National Marketing, Sustainable Innovations, StartUp
Dubuque, and Dubuque's True North. For more information on Greater Dubuque Development, please visit
www.greaterdubuque.org.
-END-
Schmid Innovation Center 900 Jackson Street Suite 109 Dubuque, Iowa 52001 563-557-9049 www.greaterdubuque.org
We the undersigned do hereby petition the Dubuque City Council to finalize an
agreement between Flexsteel Industries Incorporated and the City of Dubuque to allow
a new Flexsteel production facility to be built in the City of Dubuque.
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City Cierk's Office DUBUQUE
Dubuque,,A
INITIATIVES .
May 15, 2017
To the Honorable Mayor and City Council Members,
The Dubuque Initiatives Board of Directors (the "Board") held a meeting via
conference call at 3:30 p.m. this afternoon for the purpose of reviewing and approving
the Redevelopment Project Agreement by and among the City of Dubuque, Iowa,
Dubuque Initiatives, and Flexsteel Industries, Inc. (the "Agreement").
It is my pleasure to announce to you that after a verbal review of the Agreement and
its obligations for Dubuque Initiatives, the Board voted unanimously (with one
abstention) to approve said Agreement.
Dubuque Initiatives is pleased to be part of this important job retention effort and
north end redevelopment in our community and looks forward to its continued
involvement in the project.
Sincerely,
Douglas J. Horstmann, President
P.O. Box 1745
DUBUQUE, IA 520044745 1 (563) 5894393