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HomeMy WebLinkAboutCCMinutes_2006_03_28 93 Brookings City Council March 28, 2006 The Brookings Ciry Council held meeting on Tuesday,March 28, 2006 at 5:00 p.m., at City Hall with the following members present: Mayor Scott Munsterman, Council Members Tom Bezdichek, Michael Bartley,Julie Whaley, Ginger Thomson,Tim Reed,and Michael Reitz. City Manager Alan Lanning, City Attorney Steve Britzman, and Ciry Clerk Shari Thornes were also present. 5:00 p.m. Work Session March 28`h A�enda. The City Manager responded to questions pertaining to the action items on the agenda. City staff introduces u�coming topics for future agendas. A. Agenda Briefing. Shari Thornes,Brookings City Clerk,provided a briefing on the future agenda items. B. Discussion on Resolution 01-03: Resolution Setring Policy on City Participation on Construction of Arterial and Collector Streets. Jackie Lanning, Ciry Engineer,provided the following background information to the Council. Lanning said prior to 2003, each developer/owner paid for City stteets at the cost of a xesidential street. The City paid for the"extra width and thickness" as stated in Resolution 97-99. In this� . scenario,each developer would essentially pay fot the same street costs. If the City would designate a collector or arterial street, then the City would pay for the extra costs. Resolution No. 01-03 is included fox your reference. In 2002, the City Council discussed creating a new policy fox the construction of arterial and collector streets. One dYaft included a statement"Utilities such as water and sewer axe not included in this policy". However,the final draft that was adopted included a statement"Utilities such as water and sewet are included under this policy when they are determined by the City to be necessary for the construction of the street". The results have been since 2003, this policy has caused the City to pay for cosdy work that has been drawing down the balance of the assessment fund. In 2003, 20�' Street South Paving Project cost $268,400 and in 2004, 34�'Avenue utility woxk cost appro�mately$270,000. The assessment fund has been quickly depleting due to this policy because there is no recovery mechanism for these payments. The assessment fund would be projected to go to zero if required to pay for more utility projects. Lanning recommended the following changes. DOT Urban funds are eligible for consttuction of collector and axterial streets. However,utility work is not eligible. Several options to be discussed a.re listed as follows: 1) Keep policy as is;2) Revoke the portion of the policy where the City pays for arterial streets and utilities. This would cause streets to be petitioned and assessed by the abutting landowners; 3) Revoke the portion of the policy where the City pays for utilities. The street work would be paid for with SDDOT Urban Funds, Ciry or grant funding, and there would be no cost to the abutting landowners, or 4)Add a statement indicating the City would pay for arterial streets when di�ected by City Council,or similar language. This would allow for streets such as 34`� Avenue to be constructed with SDDOT Urban Funds,City or grant funding. T'hese could be determuied on a case-by-case basis by the City Council. Lanning clarified that the SDDOT Urban Funds can be used for paving, curb and gutter, and storm sewer,but they can not be used for water and sewer work. The City receives approxitnately $400,000 in urban funds annually that remain in an account until needed. Funds have been used for collector and arterial streets on urban systems map. The map is approved by the Council on an annual basis. Bardey asked if changing the policy would affect the ability to build out 34`"Avenue. Lanning said the updated urban map xesolution moved 34`� out one year. The next piece of arterial road slated fox construction is 34�'to Prince Drive to 6�' Stteet. If policy reverts to old Res. 97-99,petitions would be needed fxom landowners to pay for their residential street costs which may affect the timetable. 94 Bardey asked if a change at this time would affect that project. No. Alan Lanning,City Manager, said there is a difference between street and alley assessments. Alley projects are done by those who want them paved. The policy for stxeets was changed which is a similar application. It is not a fairness,but a consistency issue. If the uxban fund can't sustain itself, there is a problem. The City would have to eliminate, supplement or develop a mechanism to add xevenue to the fund. This fund is not sustainuzg itself under this policy. Regardless if there is a road now or 15 years from now,we need a mechanism to replenish the funds so projects can proceed when needed. Urban and assessment funds are the only sources. The City will reduce its ability to keep pace with other needs if it has to budget for streets and placing water and sewer. He hopes Brookings Municipal Utilities would be able to address those needs. He noted that once water and sewer is installed,the City's general fund doesn't receive revenue from those funds. The financial installation burden should be on the entity that gains revenue from those funds. The urban fund had positive revenue and but now has no revenue genexation. Jim Flippin commented that 20`�Street South was developed early for the soccer fields and already had sewer and water in the road. The xecreational activities got ahead of development and the City used those funds to pave the road. Home owners along that road will pay for sewer and water as needed at today's prices. Mike McClemans questioned why watex and sewer couldn't come from the fund. In the case of 20'" Stteet South, all water and sewex had been put in and the owners had a choice to pay up front in 1996 or at today's price. With this fund arterial streets axe 80'wide rather than the standard 66' width. The City will need 7' of right-of-way from each property owner. He commented that the policy was mirroxed after Sioux Falls. By making a street a major arterial,it gives the Ciry control over driveways. T'he reason this made sense is that it allows the Ciry to acquixe the correct amount of right-of-way for axterial streets and control the dxiveways. He cited the example of 22°d Avenue as something to avoid with all the driveways entering into the arterial street. In following this policy the property owner agrees to a specified number of driveways. This policy enables the City to get the appropriate type of street construction,water and sewer is already there,and transportation funds are utilized. With 34�'Avenue east of Swiftel Center,the City got ahead of itself. Instead of doing water and sewer as needed,they did the entire mile at one time. Some developers still aren't ready to develop that atea. He could have xequested paving his 1300 feet of his development. Other developers could have not paved in their sections. A piecemeal approach makes no sense and the costs go up. Bezdichek asked if thexe was a difference between arterial streets and others. Arterial streets are developed based on traffic and safety needs for specific developments. Alleys are handled differendy. Alan Lanning said prior to the policy,the City had developed arterial streets for many years and everything was getting done. After the policy change,the fund depleted. Whethex we have an ordinance that controls driveways is not a relative argument. A motion�a.r made by,Beed,seconded by Whaley, to place thi.r i.r.rue on a 6:00 p.m. agenda for further di.ccus.rion. Adl pre.cent votedyes;motion carried Council Invitations. Thornes reviewed the City Council's upcoming invitations and obligarions. City Council Member introduction of to�ics for future discussion. � Munstexman asked the Council to consider a review of the resolution pxocess and how more communication can occur between the public and the City Council. He noted that resolutions carry the same weight as ordinances and are often referable,but they are not a two step process like ordinances. A motion was made by Bartky, seconded by Keed, to reuiezv the re.rolution pmce.r.c at a future�neeting. All�iresent votedyes; motion carried. 6:00 P.M. CITY COUNCIL MEETING Consent Ag.enda: The Mayor added a proclamation to the agenda. A motion was made by Thomson, seconded by Reed,to approve the consent agenda which included: A. Council Agenda. B. Action to approve Resolution No. 27-06, appointing election workers for the Apri111, 2006 municipal/school election. 95 Resolution No.27-06 Appointrnent of Election Judges WHEREAS,a City of Brookings Municipal Election will be held on April 11,2006 for the positions of the Mayor and two Council members;and WHEREAS,as required by SDCL 9-13-16.1,the City Council must appoint Election Superintendents and Deputies and set their rate of compensation;and WHEREAS,the following superintendents and deputies are hereby appointed at a rate of$8.50 per hour fox superintendents,$8.00 per hour for deputies,and a flat fee of�15.00 for the April 10,2006 Election School: RESOLUTION BOARD PRECINCT 4-Ascension Lutheran Church David Peterson&Larry Hult Sue Knutzen,Superintendent Maxlys Schutt PRECINCT 1-Tompldn's Alumni Center Shaxon Anderegg Bobbe Bartley,Superintendent Karen VandexWal-alternate LaRayne Wahlstrom Patrick Query PRECINCT 5—Bethel Baptist Chutch Richard Wahlstrom-alternate Carolyn Hieb,Superintendent Ramona Helwig PRECINCT 2-15�Lutheran Church Carleen Dixon Hazel Hauff,Superintendent Maxy Fiedler—altemate Neva Jean Corlett Norma Linn PRECINCT 6—United Church of Christ Pending-alternate Connie Burdick,Superintendent Barb Erickson PRECINCT 3-City Hall Candy Osvog Verle Barg,Superintendent Saila Gandhi—Altemate Barb Woolworth Linda Santema Russell Lokken-alternate C. Action on lease agreement with Verizon Wireless to locate a tower on Bob Sheldon Field. D. Action to approve Resolution No. 28-06, for STB-Urban System Priority List. RESOLUTION NO.28-06 STP-URBAN SYSTEM PRIORITY LIST WHEREAS,the City of Brookings has designated certain streets to be included in the STP-Urban System of Streets as defined by the SDDOT;and WHEREAS,the SDDOT has designated cextain funds,Federal and State to be used for construction, reconstruction and major repair of the STP-Urban System Streets;and WHEREAS,the City of Bxookings has been iequested to establish a priority list of projects to be considered for funding by the SDDOT; NOW,THEREFORE,the City of Brookings hexeby resolves that the following projects be considered in the order listed: Priority Bid No. Project Location Year TXpe of Work I�ng#h(mi.) �� 1. 22°a Ave. fxom G�St.to US14 By-Pass 2007 AC Overlay,Digouts, 1.0 $300,000 Pvmt.Markings 2, 22"a Ave.from 11�St.S.to 20t''St.S. 2007 Mill,AC Overlay,Pvmt. 1.0 $250,000 Mazkings 3. Bike Trail along I-29 to 34� Ave.,over I-29,parallel to 2008 _ Asphalt Bike Trail $608,950 22nd Ave.to SDSU 4. 34�'Ave fiom Grading,Curb&Gutter, US 14 to Prince Drive 2009 &Asphalt Suxfacing 0.7 $1,000,000 S. Medary Ave.S.from 20�''St.S.to 32°d St.S. 2011 Grading&Asphalt Suxfacing 0.7 �500,000 E. Action to approve Resolution No. 21-06, a Resolution Authorizing Change Order (CCO#2) for ARFF/SRE Building. RESOLUTION NO.21-06 A RESOLUTION AUTHORIZING CHANGE ORDER(CCO#2)FOR ARFF/SRE BUILDING i�lills Constnxction Inc.,Brookings,SD 96 BE IT RESOLVED by the City Council that the following change order be allowed for ARFF/SRE building: Change Otder Numbex 2-Mills Construction,Inc.will complete the plumbing woxk to lowex sewage pit for the ARFF/SRE Building,add coded locks and countertop,as an addirion to their contract.Adjust base bid for Aircraft Rescue and Fire Fighting Building to include plumbing woxk,locks and countertop for a total increase of $2063. F. Action on Authorizing the Mayor to Sign a Letter of Support for Cooperative Planning Grant Application for Pandemic Influenza. G. Action on Resolution No. 29-06,Authorizing the Ciry Manager to Sign Documents Related to Preparing a Grant Application for Pandemic Influenza. Resolution No.29—06 Authorization for the City Manager to Sign Documents For A Cooperative Planning Grant Application for Pandemic Influenza Whereas,the Brookings Area has a need to develop a zesponse plan for pandemic influenza and, Whereas,the City of Brookings will be a partnex in a cooperative grant application and subsequent planning activities and, Whexeas,the Bxookings Hospital also known as the Biookings Health System will be the lead agency for submitting and administering the gxant. Thexefore,Let It Be Resolved by the City of Brookings,South Dakota,that the City Manager be authorized to sign documents on behalf of the City of Brookings for the Coopexative Planning Grant Application foi Pandemic Influenza. H. Action to appoint Lynn Darnall to the CVB Board as a City representative. I. Action on Resolution No. 30-06, to authorization to sign the Contract for Federal-Aid Highway Improvement Project NH 0014(142)420-PCN 6462. RESOLUTION NO.30-06 FEDERAL AID CONSTRUCTION PROJECT NO.NH 0014(142)420-PCN 6462 6TH STREET CONSTRUCTION PROJECT WHEREAS,the DEPARTMENT OF TRANSPORTATION acting through the South Dakota Transportation Commission conaus in the proposal with the CITY and BMLJ fox the new construction or improvement of a street identified as South Dakota,Federal Aid Construction Project No.NH 0014(1421420-PCN G4G2,Brookings ount�,hereinafrer designated as the PROJECT, extending thxough poxtions of City of Brookings,South Dakota,located and further described as follows: US14 from Medary Avenue to Twenty Second Avenue in BrookingS Grading Storm Sewer, C&G PCC Paving Traffic Signals,J�g' hting,Pavement Maxking Pexmanent Sigr��and Purchase 2 Portable�ignal Tailors. WHEREAS,B'VIU desires the STATE to let in combination with PROJECT a water main and sanitary sewer project number WW0601-PCN X126,US14 from Medary Avenue to Twenty Second Avenue and, WHEREAS,the Statutes of the State of South Dakota give assent to the provisions of the Safe, Accountable,Flexible,Efficient Transportation Equity Act and acts amendatory thereof or supplementary thereto and regulations issued pursuant theieto by the Federal Highway Adminisuation,Department of Transportation,United States of America,which hereinafter collectively will be designated as the Act,and charge of the STATE,the CITY and BMU to do all things necessary to fully carry out the cooperation contemplated and provided for in the Act;and WHEREAS,the section of the PROJECT within the CITY will be subject to the provisions of the Act,and is within the legal jurisdiction of the CIT'Y for uaffic xegulations and the control of building setbacks,zoning,sidewalks,utilities,etc.;and WHEREAS,the construction of the PROJECT is conditioned upon the fulfillment of the obligation of the CITY and BMLI in a manner satisfactory to the STATE and the Fedexal Highway Administrator,or their authorized representatives: THEREFORE,BE IT RESOLVED that the City of Brooking duly authorizes the City Manager of the City of Brooking to sign the Contract and other telated documents Among the City of Bxookings, BMLJ, and the State of South Dakota for Federal-Aid Highway Improvement Project NH 0014(142)420-PCN 6462. 97 Annual State of the City Message from Mayor Scott D Munsterman The City of Brooking,c i.r committed to providing a high quality of life for it,r citi�ens, and fostering a diver.re economic ba.re, through innovative thinkin� .rtrategic planning, and proactive,fiscally re,rpon.rible municipal management "This mission emphasizes commitment to a common cause, a common goal, and a common purpose. Nothing worthwhile is evex accomplished without challenges and nothing worthwhile is ever accomplished without courage. This past year's accomplishments have exemplified both of these qualities. Recently I had the privilege and the honor to take part in providing Senator Johnson with a tour of Brookings. This tour, organized by A1 Heuton our BEDC director,provided an excellent snapshot of Brookings. I left the tour wishi.ng everyone in Brookings had been with us... because Brookings is growing, on the move and is at an exciting point in history. We certainly have unique challenges in our community;however, strong leadership and great teamwork will continue to address these challenges in a comprehensive manner. Here is an overview of the past year's accomplishments: Fiscal Management The 2005 fiscal year xecorded another surplus budget for the City of Brookings. Oux total revenues of$10,926,606 exceeded projections in our balanced budget of$10,217,734. Actual expenses were 3%lower than budgeted,leaving the City with a surplus of nearly$1.1 million. This is the result of our City's financial policy and the dedication of the City administration to hold the line on expenses and increase efficiencies within each depaxttnent. This enabled increased investment in capital improvements,nearly$500,000 over the last few years, helping to continue to address our need to replace equipment. Sales tax revenue increased 9.76% as compated to 4.96%in 2004. We instituted the 3�B tax in June of last year. This tazc should bring in around$300,000 and will be used to attract visitors to Brookings. Even in light of our continued utility transfer decline,our conservative fiscal management is paying dividends and we are continuing to show more strength. A recent independent review by Moody Investozs (a leading independent credit rating firm) in February of this year brings this to light. Our City's bond xating (indicating fmancial strength) rose from a Baa1 rating to an A3 rating. Why the reason for this improvement? Please allow me to read to you some of the comments of the independent evaluatox: "Over the past five years,the General Fund (balance) has increased from$2.52 million (28.1% of revenues), to a healthy$4.2 million (44.6%of xevenues) in fisca12004. During the same period of time,its liquidity notably increased;net cash as a pexcenta.ge of revenues rose from 18.3%to a solid 33.4%. Moody's additionally notes that through tight budget oversight, the City's 2004 e�cpenditure level is actually 3.7%less than that for fiscal 2000. Moody's however believes that, despite the risk associated with a dependence on sales tax (traditionally sensitive to broader economic conditions) and transfer payments (which are subject to reduction), the City's financial operations will remain consistent with it's A rating. In addition to strong and liquid reserve levels and tight fiscal management, future sales tax collections should benefit from an increasing retail footprint. Moody's believes that with expansion and continued diversity in retail,Brookings,over the next several years, should enjoy slow but steady growth in sales tax collections,helping to further increase coverage rates. Moody's believes that the City's expected steady economic development and large institutional presence (SDSL� should help keep the City's debt profile manageable and coverage ratios healthy." This is great news for Bxookings and makes it clear we are gaining in financial strength. Economic Development 'The City of Brookings experienced tremendous change this past year in the area of economic development. With the advent of developing a regional plan through a teamwork approach, expansion of economic development investment in our region will gxow exponentially for years to come. In years past, the Ciry of Brookings provided the primary financial support to the Brookings Economic Development Corpoxation, for a total budget of around$150,000. This qear—with the 98 addition of public partners consisting of the City of Brookings, the regional comtnunities of Axlington,Elkton,Estelline,Volga,Sinai and Bushnell;and pattnerships with SDSU,the Bxookings Hospital and the Brookings Municipal Utilities—the public sector investment has incxeased to $300,000 per year fox the next five years. In addition,the private sectox, through the leadership of the Bxookings Vision Coalition,has undexgone a$3.5 million fundraising effoxt for the next five years—and has already successfully raised$2.2 million. With both public and private funds (totaling approximately$1 million per year for the next five years) economic development in Brookings will reach a new level. The Innovation Campus at SDSU has already received a benefit from the fundraising attempt—$1.5 million raised fxom the fundraising efforts is being used as part of a match to qualify for a$2.5 million EDA grant from the federal government. These funds will be used this yeax to begin building in the new research park. Challenges do exist for our economy. A xecent housing study commissioned by the Ciry Council last September reported a lack of affoxdable housing in the $90,000 - $150,000 range. Over the next several months, the BEDC will organize a regional plan of action to address this problem. A look at history bears this to mind... since 1970, our employment numbers have gained nearly a 160% increase as opposed to a modest population gain of nearly 30%. As a result,people from pxedominately a ten county area drive to Brookings for work. Brookings has outpaced Codington and Minnehaha County in non-farm employment with a 120% change since 1970, compared to a 105% change for Codington and almost a 60% change for Minnehaha County respectively. However, the population change is reversed: Minnehaha led the increase in population at 55%, Codington County at 35%and Brookings experienced about a 25%increase since 1970. These facts emphasize Brookings is good,if not great, at producing jobs as a matter of fact there were between 300-400 jobs available at any one time last year with a total of 700 new jobs created last year alone. But we are not getting these same people who work here, to live hexe. Worker recruitment is difficult. According to our large local employers, this is due to the lack of affordable homes and the lack of retail and entertainment opportunities. Brookings has taken a bold step to address this age-old problem of retail development for oux community,by attracting more xetail options. With the addition of Lowe's opening this Novembex, the City recently purchased 26 acxes of prime retail/commercial property fxom the State Department of Transportation. The DOT needed to upgrade its facilities and discussions between the City and the DOT for the last three years has resulted in the final agxeement to relocate the DOT facility to a location of their choice. The City was able to negotia.te and purchase the pxoperty for the relocation. This created the option to buy more land for the expansion of industrial development, due to the near full capaCity of our current industrial park. This land, along with 35 acres to the north of the DOT propexry (currendy the Wiese Business Park) will be developed into a 66 acre tetail development with nearly 600,000 square feet of space once it is built out. At the end of the day,the total project should be revenue neutral to the City - the 66 acres of land eventually being sold will pay not only for the purchased DOT properry but also the land purchased for industrial expansion. This retail footprint will bring increased sales tax revenue for the City for decades to come and prevent retail losses,like the recent loss of Seaxs. Quality of Life Several quality of life issues were addxessed this past year... �ort The Bxookings Ciry Council has spent an extensive amount of time learning and understanding our unique issues with our airport. Due to our non-compliance with the runway protection zone (RPZ) we have had to work with the FA.A on a plan acceptable to them to not only coYrect the RPZ issue, but also create a master plan supporting our airpoxt needs for the future. This is accomplished with lengthening our runway to accommodate laxger business and commercial aircraft,hangar space and support facilities. The City Council has approved a FAA required feasibility study to be completed within the next 18 months which will provide the Ciry with the xest of the information it needs to make this long term decision. Federal and State financial commitments are dependent upon the study results and could reach$10 million or more. DM&E Pxoject T'he DM&E project has been a longstanding issue for the la.st 8 years and appears to be coming to a final stop.T'he Surface Transportation Board has issued its final ruling and DM&E now awaits approval for a federalloan to fund its expansion project. The time has come for Brookings to establish a positive, cooperative relationship with DM&E in providing maximum safety and qualiry 99 of life for the established in-City route.The City Council is focused on this safety issue and will have further discussion on a proposal this evening. Downtown Pxoject The Downtown Project is awaiting further information on the possibiliry of funding for the infrastructure needs made apparent through our analysis in 2005. 80 to 90 year old clay sewex tiles have xeached their life expectancy and prior to the City contemplating a downtown renovation,it will be very unportant to fully assess this issue. Draina-� Preliminary work has begun in establishing a comprehensive drainage plan for the City. This will need to involve a public and private paxtnership to ensure the best case scenario exists for the future development of property. Several quality of Life impxovements have been made this past year to our community. Fire Denarttnent �— Oux new fire truck fleet has nearly all arrived.This improvement will not only bring sta.te-of-the-art in emergency response to the Brookings area,but will also provide the very best in protection for our dedicated volunteer firefighters. Bovs and Girls Club The Boys and Girls Club is currendy engaged in a fundraising campaign. The City transferred property to the Club and has committed$100,000 pex year for the next 5 years to the building campaign. In addirion, the City Council provides operational funding for this important service to our youth in our community. SDSU Wellness Center 'I'he SDSU Wellness Center will be getting off the ground due to the exemplary efforts of the SDSU student senate and student body. The Ciry will contribute the$500,000 that was earmarked for this project in 1997. Swiftel Center The recendy installed air cond.itioning in the Swiftel Center will enable more events year round, incxeasing the capacity of the center. Last year over 100,000 people attended events. With its continued successful programming, the Center will reach its maximum capaciry in the neat future. Communit�Wellness Council The Brookings City Council,in partnexship with the Department of Health and the Governor's Commission on Health Caxe,piloted a Community Wellness project involving 75 participants of the Brookings communiry. The results were impressive in terms of improvement of health outcomes and could cause our City to take a fresh look at how we can build the promotion of health and welIness into our paxk and recreation system. Ac�uatic Park And last,but certainly not least, the new Aquatic Park is nearing completion thanks to the generous contributions from the Don Endres and Dale Larson families. Because of these contributions and the City's 2nd penny investrnent, the citizens of Brookings will enjoy some great summer recreation for yeaxs to come. Conclusion Much has been accomplished in a short time. I owe a debt of gratitude and special thanks to my elected colleagues. They have sacrificed their time at work and time with familp to serve you,the people of this community. A special thanks to our volunteers who serve selflessly on oux City boards, theiY effoxts are titeless. A thank you to the Ciry staff and management team for the relentless push to serve our people well and make this a great City. And finally a big thank you to the people of the City of Brookings for showing everyone in the nation why Brookings is a great place to live,work and play. We axe famous because we caxe about people–let us never lose that passion." Ordinance No. 03-06–Budget Amendment. Second reading and action was held on Ordinance No. 03-06,Budget Amendment#1,An Oxdinance Entitled"An Ordinance Authorizing a Supplemental Appxopriation To The 2006 Budget For The Purpose Of Providing For Additional Funds For The Operation Of'I'he City. Motion was made by Bartley, seconded by Whaley,to 100 approve Ordinance No. 03-06. All present were given an opportunity to be heard. All present voted yes;motion carried. . Ordinance No. 04-06—Fowl. Second reading and action was held ori Ordinance No. 04-06,An Ordinance Amending Article III and Article V of Chapter 14 of the Code of Ordinances of the City of Brookings,South Dakota and Pertaining to Proxixnity of Fowl to Dwellings,Fowl At Laxge and Prohibited Animals in the City of Brookings, South Dakota. Motion was made by Whaley seconded by Reed, to approve Ordinance No. 04-06. All present were given an opportunity to be heaxd. All present voted yes;motion carried. Ordinance No. 05-06—Alcohol. Second teading and action was held on Ordinance No. 05-06, amending Chapter 6 of the City Code of Ordinances pertauung to Alcoholic Beverages (Section 6-4 —Sunday Sales). Motion was made by Thomson, seconded by Whaley, to approve Oxdinance No. 05-06. Discu.csion: Munsterman said he would vote against the ordinance stating he felt Sunday sales should be on an event basis only or as needed basis rather than blanket allowance. Bezdichek noted that state law allows sales to commence at 11:00 a.m. rather than the noon time cited in the ordinance. Britzman said that was correct and the times used for this ordinance wexe past of the easlier ordinance. Bezdichek said there a.te a number of food establishments downtown. However,under the ordinance as written ba.ts that don't serve food could be open before noon. He requested the Council look at the opening times for bars and restaurants. There axe currendy restauxants open right now that adults go to watch a game or race with drinks and young children are present. Some adults may want the option of a facility without food in where they won't mingle with minors. Those types of establishments open on Sundays would provide a separation from adults wanting to watch a game while drinking beex from those with small children. He is not proposing to open up downtown for more consumption,but rather more separation for activities on Sunday (i.e. Nascar races, football). An 11:00 a.m. opening rime would give food establishments an opportunity to prepaxe and deliver food to baxs. Often those sporting events have pregame that starts at 11:00 a.m. He'd rather have college kids and other adults separated from family xestaurants. This may result in more shops being open and spouses would have a place to watch a game while their spouses shop. A motion to amend iva.c made by BeZdichek, seconded by I�eit� to change the time to 11 a.m. to midnight for liquor and beer. It was noted that u.ine would r�main at noon per.rtate law. On the amendment, ald present votedyes; motion carried. Di.rcussion: Bardey asked if the changes would still require servixig of food. Britzman said on-sale (liquor) establishments would still require food in order to be open on Sundays;however,on-sale malt beverage establishments would not require food. On the main motion a.c amended, a1l pre.cent votedyes;motion carried Ordinance No. 06-06—Rezone. A motion was made by Whaley,seconded by Thomson,to approve first reading of Ordinance No. 06-06, a petition to rezone Lot 5 of VanDerVliet Addition from an Agricultural A District to a Business B-3 District (22nd Avenue South and 32nd Street South). All present voted yes;motion carried. Public hearing scheduled for April 18�'. Ordinance No. 07-06—Rezone. A motion was made by Thomson, seconded by Reed, to apprave first reading of Ordinance No. 07-06, a petition to rezone the west 60 £eet of Block 1,Avery's Addition from a Business B-2A District to a Residence R-2 District (1412 6th Street). All present voted yes;motion carried. Public hearing scheduled for Apri118�'. Ordinance No. 08-06—Rezone. A motion was made by Bartley, seconded by Reitz,to approve first xeading of Ordinance No. 08-06, a petition to rezone Lot 17, Block 9,McCleman's Addition from a Residence R-1B District to a Residence R-3A District (19th Street South and Ranger Drive). All present voted yes;motion carried. Public heaxing scheduled for April 18�'. Ordinance No. 09-06—Boardinghouse. A motion was made by Bartley, seconded by Reitz, to approve first reading of Ordinance No. 09-06, an application for a conditional use pern�it to establish a boardinghouse for six (6) persons on Lot 8,Block 8,Morehouse Addition (819 9th Avenue). All present voted yes;motion carried. Public hearing scheduled for April 18`''. 101 City Manager Contract & Performance Pa� A motion was made by Bardey, seconded by Reitz, to approve the City Manager 2006/2007 contract with a five percent (5%) base raise and five percent (5%) pexforxnance pay payable at the earliest possible date. All present voted yes;motion carried. Purchase Agreement. A motion was made by Thomson, seconded by Whaley, to approve an amendment to ihe Purchase Agreement for the SW1/4, SE1/4 of Section 19,Township 110 North, Range 49 West of the 5th P.M.,Brookings County, South Dakota, except Lot H-1 in the SE1/4 of said Section. Di.ccu,r,rion: The closing date for the.rale to the.ctate has changed from March 29'b to Apri128'b, avhich i.r better for the City. Be�dichek asked if there are any above or belo�v ground tank.c. L.anning,raid the environmental.rtatus ha,r been reviezved. Contaminated,roil zva,r removedyears ago and he ha.r that re1bort. All present voted yes;motion carried. Agreement with Prairie2and Partnership,LLP. A motion was made by Whaley, seconded by Thomson, to authorize the City Manager to enter into an Exclusive Agreement to Negotiate with Prairieland Parmership,LLP. Discus.rion: Baxdey provided a background summary on the pxoject. The Ciry has long tried to acquire the SD Depaxtment of Transportation property located on the northeast corner of Highway 14 and I-29. This staxted when the Planning Commission was working on the City's 2020 vision plan, the City worked on the issue to guarantee that it wouldn't be inappropriately zoned (i.e. cement plant) or the state buy it. The City rezoned the property,per the State's request, as a Planned Development District (PDD) for the most fle�cibility and the most control of that property. At that time, SDDOT looked at alternate sites for their highway shop and suggested they were going to move. They looked west and north of town, studying the City's proposal but decided at that time it wasn't appropriate for them. Things stalemated. There was no immediate need for the City to acquire the property but when would DOT move. Two yeaxs ago discussion resumed. The state was shown altexnate sites,the City identified a new site, an offer was made,but no response from the state. At that time the state did an appxaisal on the land. They offered to sell the City the back half for $226,000,but the City Commission at that time felt it didn't need the back half and wanted the entire parcel, still anticipating the City would get that property and move DOT. In November 2005 a developer from Minneapolis appYOached the City about that site with a large development proposal. The City Council was apprised of that and the decision was made that the City needed to talk to the state again about determining a price and purchasing the property. During that time another developer came in and offered to purchase the property for$4 million. The City appxoached state officials indicating that the City needed to buy the pxopexty and had a developer xeady to coinmit$4M. SDDOT officials countered with a$6M price and the two�asties were at an impasse. At that time the City Council decided it needed help and on December 215L a special subcommittee of the Mayor,Reed and himself inet with a group of concexned local legislators and local business leaders for input and advice. They were shown the developexs proposal,explained the difficulties in acquiring the propetty, and were asked foY their help. It was at their suggestion,that a meeting with the Governox was arranged. The Governox set the price at$4M. It has been done in a quick manner because the City was up against the wall on timing due to the sta.te's timetable. When the City was trying to buy the property the state had already decided they would build a new building at the same location and was already being designed with bids scheduled for summer 2006. The City didn't want that to happen because it would tie up that ixnportant corner for 30 to 50 yeaxs. It was paramount to secure that property. These things have to be done in executive session and no laws were violated. Part of the deal with the Governor was that the City had to piatchase replacement land. The City Council didn't want land prices to get inflated, so these negotiations had to be done in private. Once again the Council asked for advice fxom the focus group on how to proceed. Those recommendations were provided to the Ciry Council and the pxocess to proceed with the purchases. The agYeement on the replacement land was reached the T'hursday priox to this meeting. That is how quickly the Council has had to move on the issue. The DOT land deal and pricing was established by the Governor. The October 2007 closing will allow the City to not boxrow any money and close with the developex. Before the Council tonight is an Exclusive Agxeement to Negotiate with Prairieland,LLP,a developer from Minnesota with properties in South Dakota and Brookings. The proposal involves a concept site plan of 66 acres with an exclusive right to develop. Copies of the plan were provided to the audience. The City needs to look at the biggest developer. Their plan is comprehensive and they have the ability to make large box retail contacts that are needed to secure operating agreements that makes this project financially work for them. They also have the ability to provide incentives 102 for the project. A large scale development allows for them to do that. If the property is parceled into smaller areas,it doesn't allow for the xecnutment of large retail and doesn't provide a way to recoup on additional development. This helps because the City doesn't have to provide the incentives. This company has large names and large credentials. The Council felt it was the best option to pursue at this time. These people want an exclusive agxeement to do that. The worst case scenario is after the developer finishes their due diligence period and the numbers aren't working, the City would still own the land,would have to develop it in another manner. Prairieland's proposal is $80 to $100 million investtnent creating 650,000 square feet in large retail space, xestauxants, and hotels. It is a marvelous plan that compliments the Swiftel Center,Larson Ice Arena, and community as a whole. The City is purchasing the land no matter what. The DOT needed to be moved and that has been accomplished. The City Council operated as much in public as possible. They appreciated the focus group; they got the City where it is today. This was an effort beyond the City Council and City Manager that got this accomplished. Dick Peterson said he seldom appears at a Council meeting unless it is an issue that he deeply believes in. He said Bxookings has developexs that can do development. He cited several examples of xetail businesses recruited by local developers. He agtees that the City needed to purchase the DOT land,but these developers haven't had the chance to participate. He recommended the Council take a deep breath and do this project as a community. Bartley said thexe haven't been any local developers coming forward or stepping up to the plate to make such a grand suggestion. He doesn't belitde the importance of the contributions made by our local developers. But this rype of development is completely different than anything ever done in Brookings. It is a very laxge deal with large commitments and someone with national conta.cts is needed to get this accomplished very quickly. The City had to get involved on the Lowe's project for the local developer because he was unable to make the deal. The Council would prefer not having to do another incentive project,but they will if this doesn't pencil out for the developer. This has the potential of succeeding. He believes it's the right thing to do for the City. Bezdichek said Bxookings is a great place to live. It has been developing since it was founded. The City started working to acquire the DOT property a number of years ago and that was the piece of puzzle that developers were looking at. Now that it has been obtained,he believes that the people in the community that built residential areas and industries should have an opportunity to look at it. He would like to see the BEDC involved.Whatever gets developed will be there a long time. He doesn't see why we're not letting individual developers have an opportunity to paxticipate. Jeff Rief,Larson Manufacturing General Manager,asked if the City had an agreement to purchase from the developer. Bardey said no,this is not a sale,but an exclusive right to negotiate. The Council will have final say on the sale and the development plan. They will have the ability to say no if all the requirements aren't met.T'his is not a putchase agreement and the City will benefit from any work that they do (i.e. engineering/surveying�. They have the ability and contacts to recruit latge xetail(i.e. Kohls,Taxget)with 60% being built out in 18-24 months. The remainder built out in 5 years. Peterson asked to give local developers a chance. Bartley said the Council could write an RFP on the project,but local developers couldn't meet the asset,development experience and built-out requirements. Jeff Rief said he was sympathetic to the comments. The key to this project being successful was securing the pxoperty. The City was in the position to make that decision quickly and to not let the DOT go forward with their building plans. He said all can agree in the long run the City needed to secure that property. As far as developing the property, a number of developers can do it. What is key is finding the right retailers and anchor store. The structure is secondary. Their success won't be on the brick&mortar,but the companies recnuted within. That is the difference and the teason to go with the larger developer who has expexience in that arena. He understands the concern regaxding making this decision with not as much public input as some would like. However, timelines for opportunities get crunched and that is the venue and axena the City is playing in. It is the right decision for the City of Brookings. It is a great direction to move in and he is interested in supporting. Brian Darnall asked if the $4M price was negotiated with the developers. Bartley said yes,it would be formalized in a purchase agreement after the due diligence period. There axe no market forces that determine that$4M? If a local wants to pay$6M are they shut out? Baxdey said it would be an 103 exclusive agreement. The additional land will be used for purchase of future industrial park land which the City is out of. Munsterman said the City would make a decision by December 2007 or earlier on the sale of land and purchase agreement with the developer. John Gustafson expxessed concern that this project was happening too quickly. Most citizens didn't know anything about this until a couple weeks ago. The City buying the DOT land was the right thing to do. He was concerned about the City entering into exclusive right to negotiate with this developer without a provision that forces them to mov�more forward. $4M was initially offered, but if the developer doesn't see those numbers working can they renegotiate price? He suggested they provide earnest money for tieing up the property for that long. He has no question about their clout. But if they change their minds,he doesn't want to see all that time lost. Baxdey said possession won't occur until October 2007. Due diligence by the developer will be completed by December 2007 or sooner. T'he decision to enter into an agreement will be done after that. Maybe a local developer could do this project. But time is of the essence fox the City to turn the pxoperty over. Gustafson said more retail space is needed for the City to grow and purchasing this land for development is the totally right move. It will help the City of Brookings and that growth will benefit him. But the City hasn't stopped and given local developexs an opportunity to paxticipate. He recommended giving 60 days for locals to try. Maybe nothing wiIl happen but they've been given the opportunity. There are locals that know contacts with the"Taxgets"and have the ability to negotiate and make deals. Bardey said delaying gives way to the risk of the developer walking away. Gustafson said in October 2007 they could walk away then too. Bartley said this developer would utilize local contractors and subcontractors and would be good for the community. This is a great proposal and shouldn't be taken lighdy just because it's not a local person doing it. Gustafson said he doubted if the firm would give up their rights to research. Bartley said it's in their contract. Gustafson saad the Minnesota firm would likely bring in their own contractoxs. Mike McClemans said he is pleased that the DOT land has been secured. As a realtor with limited experience in commercial,he met with Lewis Drug who wanted to build in Bxookings but couldn't find any land and opted to lease. Expanding the retail land is great but he is bothered by eliminating the local opportunity. This would tie up all land under one developer and squeeze out little businesses. The developer would set leases and land prices. Bartley said they will have to establish prices needed to make the project work. McClemans said the City has litde commercial property available. Now, finally another 66 acres is added but it is already tied up. There will be no more land available to purchase than there was last year. The developers have a super plan with big depaxtment stores with 3-5 yeax build-out. However,both malls went broke. K-Mart went broke. Drawings don't mean success. It could be great success,it could be medium success. He is not saying this development is wrong. It is not giving the rest of the community an opportunity to participate what is wrong. David Kneip said all would agree that the DOT land needed to be obtained. He recommended involving the BEDC and a task force to develop the land. A local restaurant owner has looked for years to purchase land near the interstate and could never fmd anything. Another local businessman can do theaters. He likes the idea of doing the entire development,but why give up all 66 cates. The City owns 30 acres with no debt load. There is no accountability for the developer and would lock it up foY years. He knows local development may be slower and understands why the City may want a bigger developer,but he worries about locals being lost. He xecommended the Council delay its decision. Ba.rdey said there are guarantees stipulated in the development agreement about build-out deadlines, the nuxnber of acxes per development and per unit purchased. Lanning said a development agreement would outline the format for development spelling out price and tenants on property, timeframe,etc. That is what the Council would approve when it's satisfied the developer can do the project. 104 Dean Gulbranson said buying the DOT land was the best thing that could happen. The thing he doesn't understand is the lack of financial commitment by the developer during the due diligence period. The City should be compensated for tieing up the land for that long. He also doesn't agree with giving the entire parcel at one time without some commitments. He suggested selling them a smaller parcel and then,if they perform adequately, sell for phases 2, 3 &4. Until they axe proven, we need to have pxotection on our end. What if they walk away? T'he City will have lost 18 months and no income. Munsterman said he has struggled with this aspect and one thing that has pushed the thought of doing this arrangement is something that he learned from the National League of Cities convention. These developers attend annual retail conventions at which time the developer markets with vendors/clients. Reitz said he would be interested in looking at less land in a joint development with locals and Prairieland. Whaley said local developers have not come forward to do anything with that land. Bartley said a prime example was the 5 acres to the east. Local realtors and developers have had opportunity to purchase fxom John Mills for a long time,but it sat there and hasn't changed hands until this developer made a puxchase agreement. Gulbxanson said Mills didn't want to sell the land. Bardey counted that this developer has made an inroad that no one has been able to make by purchasing that prope�ty. Bezdichek asked if the state offered the properry for sale would it have to be declaxed surplus? It would be sold under a bidding process. Thomson asked if it would cause a"wretch in the plan" to hold back some acres for other developments. Lanning noted that in the meetings the Council held with the developer there were paxts left bla.nk on the map for other alternatives. However,he doesn't know the answer to that question without sitting down and talking with them. During the development agreement phase there isn't anything that isn't open to discussion and negotiation. A motion was made by Munsterman, seconded by T'homson,to table until the next public meeting on April 18, 2006. Bezdichek,Munsterman,Reitz and Thomson voted yes and Bartley,Reed and Whaley voted no;motion passed to TABLE. Discussion and possible action on the Research Park Funding Request. SDSU President Peggy Miller,Jay Bender,and Larry Tiedemann were present to provide additional information on the Gxowth Partnership Reseaxch Paxk funding request. Jay Bendex apologized stating he didn't do a good job at the previous meeting explauung how important it was to fully fund their request for $150,000. At a previous meeting the City Council voted to allocate$75,000 in 2006 for the Paxk. Bender requested$150,000 fox 2007 plus the$75,000 that wasn't funded in 2006 for a total of $225,000 in 2007 and additional$150,000 in 2008. They need the money in order to get a full-time director hired that knows this industry and can move forward. They haven't been able to move forward with the project since their request wasn't fully funded. Motion was made by Whaley, seconded by Reed,to allocate an additional$75,000 in 2006 fxom the economic development fund (i.e. 20%reserve -2°d penny money) providing that we have available funds and earmark an additional$150,000 in the 2007 budget cycle out of the same fund for the Gxowth Parmexship Research Park. All present voted yes;motion carried. Discussion and possible action on the Community Parmershi�Agreement with Dakota, Minnesota&Eastern Railroad. Di.ccu.crion: Munsterman said DM&E is cutrendy seeking federal loans for their project. Over a 90-day period while waiting for the loan application, the City Council held meetings with our Congxessional Delegation to discuss desired safety options and funding. After that a subcommittee of the Council met with DM&E officials to discuss a communiry partnership agreement that addressed safety and quality of life issues. They discussed how to establish a partnership to provide the maximum amount of safety and the value of peoples'lives and they did not address money. DM&E offered their full cooperation to support any safety item the City of Brookings feels it needs to provide maximum safety for an in-City route. At the end of the negotiations DM&E agreed to provide for 105 the ma.intenance and liability costs and would pay 100% of local cost share which was more than the prior agYeement provided. Munsterman clarified that the Council's primary goal is safery for an in- City route. Bob Burns said he and his wife shared their concerns with the Council in a recent email. He said at this meeting that your decision is a grave decision. If you agree to the terms of this proposed agreement, tlus decision will affect the safety and quality of life for the citizens of Brookings for as long as coal unit trains speed through town. Before making this decision,ask yourself if you are dealing with the best possible agreement in light of all circumstances. Are you convi.nced this is the best you can do? Are you fully informed? Have you completed an exhaustive fact finding? Sought expertise? Has DM&E accepted its full responsibility for the safety and quality of life for the citizens of this community? DM&E is only able to proceed dependent on public funding and therefore has a greater xesponsibility to address safety,welfare and quality of life for the citizens. Be sute DM&E understands that and its xesponsibilities. Ask for a provision that they support a bypass or overpasses if it becomes clear as impexarive they are necessary to provide safety for our citizens. Karen Cardenas was surprised to see this on the agenda and assumed there would be more discussion and public debate. She said this is an extremely important decision and when she looked at the agreement,wondeYed if it was the best thing we could do. If signed,how axe the citizens better off? What will this agreement pYevent? How much pYOpaganda value does this have for the railroad? She asked it be ta.bled. Munsterman resta.ted the question, "Is this the best possible agreement at this point in time?" Is it better than the 2000 agreement? He responded with no. Can we get it back to the 2000 agreement terms? No. That is why the Council took the approach of what will be the safest for citizens for in- Ciry route. As for a bypass,when the Council met with the SD Congressional Delegation they asked direcdy how they would react if the City Council felt a bypass was needed. It is difficult for them to represent a bypass for funding because it's a pxoject that is pending. It is also difficult because the City has not come together as a coxnmunity for that to be a possibility. The last obstacle is that the STB has formally said Brookings doesn't have to have one. It may be possible in the future aftex everything comes together and if it makes sense to do something different than the in-City xoute. Right now the City must focus on how to provide ma�citnum safety through quad gates,whisde free status, and have an option within the agreement for whatever else the Ciry deems appropriate for safety and quality of life. DM&E will give their cooperation. That is where we'te at today. In responding to questions,Munsterman noted that the City has used consultants,City staff and the City attorney throughout these eight years on the issue. Is there a provision for bypass or overpass? No, a bypass isn't remotely on the table but they axe open to an overpass. Reed said he understands and appreciates what Dt.Burns is saying agreeing that this is a grave decision. What has changed for him is the approval thxough the STB as the catalyst. Is this agreement the best we can get? Is this the best we could be doing? No,but it's what we can get right now. This instrument can't be used to pxotest tra.ins coming though. It's about safery and getting infrastructure. Getting the 10%DM&E participation is a bonus. It is important fox the City to have a partnership with DM&E to ensure all safery options are pursued. Bartley asked has the railroad stepped up to the plate and done the best they can do for safety. We'll nevex know because the EIS ruling told them what they have to do. It's now our responsibility as a Council to provide safery for the citizens. T'he Council has negotiated in good faith with DM&E and when we as a City decide that quad gates are needed,we have the ability to move forwaxd and do that. Without this agreement the City doesn't have that ability. Any over or underpasses are decision that the community will make as a whole. T'he community may decide that quad gates and whisde free status are not enough. At that point the City will decide how to pay for those safety improvements and apply to our Congressional Delegation to assist in securing funding. It is our job to accept responsibility foY citizens' safety. In order to do that,we need be sure to have a seat at the table with the railroad in the future. Thomson said the Council has given this issue serious thought and is convinced this is the best agreement possible. It is unfortunate that the trains will come through town,but they have every right to do so. The City is now at the point when it needs to establish a positive relationship with DM&E to ensuxe maxirnum safety. His agreement is a good starting point and maybe can be impxoved upon,but that will only happen if the City works with them. 106 Brian Darnall said he was shocked that there will be a vote tonight and didn't think many realized this was happening. He stated his objections to coal trains coming through town. He cited Pierre's bypass as the desired outcome. Bardey said City Council members recently met with the Pierre Mayor to better understand their agreement and how it transpired. How did they get a bypass? They didn't. The agreement sta.tes that if the City could ever fund a bypass,DM&E would contribute$10M. Howevex the difference is there is a benefit to DM&E to run around Pierre,but that isn't the case for Brookings. They would never agree to abandon line in Brookings. Motion was made by Bartley, seconded by'I'homson,to approve the Community Partnership Agreement with Dakota,Minnesota&Eastern Railtoad as presented. All present voted yes;except Bezdichek voted no;motion carried. COMMUNITY PARTNERSHIP AGREEMENT CITY of BROOKINGS,SD RAILROAD IMPROVEMENT,MITIGATION and PARTNERSHIP This Agreement is entered into by and between the City of Brookings, SD (hexeinafter "Ciry") and the Dakota,Minnesota and Eastern Railroad(hereinafter"DM&E"). RECITAIS Among the purposes of this Agreement are to recognize the historic and positive relationship between the parties,and to foster goodwill. NOW, THEREFORE, contingent upon the occutrence of (a) final regulatorp approval of DM&E's application in STB Finance Docket No. 33407 and any othex xegulatory approval necessary to construct and operate the DM&E railroad's New Construction and Rebuild Project contemplated thereby ("Projec��, and (b) an affitmative vote of DM&E's Board of Directors to proceed with construction of the Project following such final regulatory approval -- and as a condition of construction of the Project--DM&E and the City agree as follows: 1. Grade Crossings. The City grade crossings within the City limits are as listed and at the locations specified in the map at Append'u� 1 to this Agreement Grade crossing protection is nortnally and primarily the responsibility of the governmental authorities responsible for the street/highway/xoad involved. Notwithstanding that fact, DM&E shall at a minim� furid a portion of the cost of installa.tion of crossing protection or traffic control devices at levels specified in Appendix 1. Said leveLs axe tied to annual net tonnage of coal. DM&E shall provide to City on or before March 31 of each full calendar year following completion of Project construction and operational commissioning a verified count of such coal tonnage to determine the grade crossing control funding commitments of DM&E pursuant to Appendi�c 1. The City shall be responsible for securing the balance of any unfunded crossing requirements via the federal crossings program or some othex source. Such crossing installation sha11 be implemented pursuant to and consistent with normal and customary state and federal approvals. Both parties shall exercise best efforts to ensure that the grade crossing devices required pursuant to Append� 1 shall be installed as soon as practicable. It is understood and agreed to by the paxties that grade crossing devices are pxovided for the purposes of safety,traffic control,and/or noise reduction. Any modifications made for traffic control, noise reduction or othex purposes a.re deemed reasonable and safe by the parties hereto. (a). Designation as "whistle free" or "WF" crossings means the installation of either (a) suffic,ient gates (fout quadrant) or median dividers (curbs, posts, barriers, etc.) or other devices which are reasonably expected to qualify for "whisde free" status at each crossing puxsuant to forthcoming federal regulations (which regulations axe not finalized but are expected to provide for the establishment of whistle free cxossings in the event additional protection such as that outlined above is installed) if such devices are installed priox to adoption of the zegula.tions, or (b) devices that do in fact qualify for some level of whistle free status if installed following adoption of the federal regulations. Such designation also means that,in the event the City enacts a whisde free ordinance and takes other action xeasonably required to provide a safe whisde free environment, DM&E shall undertake good faith efforts with the City and appropriate regulatory authorities to implement safe whisde free operations. (b). As a condition of DM&E funding installation and ongoing maintenance of whisde free status,both parties must have an ongoing commitment to maximize safety. The parties understand that the effective implementation of whistle free status will require an ongoing cooperative relationship 107 between the City and DM&E as envisioned in the partnership concept desc�ibed herein. The parties recognize that grade cxossing safety cannot be maXimized without coordinated efforts between the parties direcdy,and their best efforts to involve other responsible parties such as parents,the media,the motoring public, pedestrians, and others. The parties agree to cooperate in good faith to develop a reasonable and safe environment for whistle free development and maintenance. Examples include but are not limited to (a) an effective local law enforcement program for vehicular and pedestrian safety violations, (b) development of local regulations and/or ra.ilroad rules desi�med to provide a safer transportation environment, (3) coordinated joint public education programs, etc. Both the City and DM&E reserve the right to require that a whistle be blown at any crossing,regardless of its designation as whistle fxee, in the event eithex or both parties make a good faith detennination the whisde is necessary based on safety needs, provided, however, that in the event such determination is made by DM&E contraxy to the City's prefexence, then DM&E shall remain obligated to pay for its share of the whisde free upgrade. (c). The patties shall continue to make good faith efforts to encourage and secure funding for ongoing grade cxossing protection safety programs which may be funded in large part by long established government progxams. In the event any crossing covered by this Agreement could or does become eligible for normal government grade cxossing protection funding prior to construction of the Project, the parties shall cooperate to fully utilize those progxams in advance of such construction. In no event shall either party forgo opporhznities for immediate grade crossing enhancements in reliance on future funding via this Agreement, and each will act aggYessively to foster such grade crossing safety improvements prior to Pxoject construction. 2. Support. The City supports the Project, and recognizes the significant benefits it will bring to the community, sta.te and region. The Ciry will undertake good faith and pro-active efforts to promote and expedite Project construction and implementation wherever possible. This agreement is intended to put past controversies behind the parties so that they can move forward as true partners, dedicated to successful Pxoject development T'his agreement assumes and is based on building and maintaining a close working relationship between the paxties as rela.tes to Project. City shall not undertake actions that could reasonably be expected to jeopaxdize, delay or otherwise complicate xegulatory approval, political support, Project construction, other Project development and/or operations. 3. Regulatory Mitigation. This agxeement is intended to be and shall be in lieu of any STB- ordexed or other regulatory mirigation or conditions, to the extent pernutted by law. The Parties interpxet the STB mitigation conditions as being only for those communities without the type of Negotiated Agreement represented by this Agreement. The Parties hereby request the STB to waive and or rescind any such mitigation ox condition imposed on DM&E rela.tive to Brookings. 4. Obligation. The parties shall be bound by this Agreement immedia.tely upon its execution, which binding effect cannot be modified except by mutual written agreement In the event either party believes the other to be in violation of the terms of this agreement,it shall provide notice of the same to the party believed to be in violation hereof, which notice sha.11 specify the alleged violation and a reasonable means to cure said action or inaction,if any such cure is reasonably effective and available,in which case the noticed party shall be permitted at least 7 days from the date of notice to cure its action or inaction. 5. Amendments. By mutual written agreement signed bp duly authorized representatives of the paxties (in the case of DM&E its President and Chief Executive Officer), this Agreement ma.y be amended, which amendment(s) shall be sequentially numbered and shall specifically refer to this Agreement. Any such agxeements shall be enforceable as though part of this Agreement,whether or not they ase filed with the STB or any other agency. 6. Engineering&Design Modifications. It is undexstood and agreed by the parties that this Agxeement (in paxticular the Append� 1 design) is based on preliminary design and engineering analysis. As the design, engineering,operating plan and similar work product is further refined, such design features of this Agreement axe subject to reasonable changes resulting therefrom (e.g., placement of certain facilities, buildings, sidings, etc.), and subject further to City's rights undet section 1 of this Agreement. In the event the design changes, DM&E shall pxovide reasonable notice thereof to the City and coordinate any changes to Appendi�� 1 as it is xefined. 7. EXCLUSIVI'TY. THE PARTIES TO THIS AGREEMENT SPECIFICALLY OBJECT TO THE USE OF THIS AGREEMENT BY ANY PERSON OR ENTITY NOT A PART'Y HERETO IN ANY MATTER RELATED TO STB FINANCE DOCKET NO. 33407, 108 OR ANY OTHER ASPECT OF THE DM&E R.AIL CONSTRUCTION AND REBUILDING PROJECT. BOTH PARTIES TO THIS AGREEMENT HAVE NEGOTIATED IN GOOD FAITH, AND HAVE MADE CONCESSIONS IN THE SPIRIT OF A NEGOTIATED COMPROMISE. BOTH PARTIES HAVE GAINED BARGAINED FOR CONSIDERATION AS A RESULT OF THIS AGREEMENT. NO ONE PROVISION OF THIS AGREEMENT STANDS BY ITSELF. EACH IS INTERRELATED TO THE OTHER, AND ALL RELY HEAVILY ON AN OVERRIDING PARTNERSHIP RELATION. CITY HAS HELPED PAY FOR THE ENHANCED IMPROVEMENTS BY ITS ONGOING AND EARLY COOPERATNE PARTNERSHIP EFFORTS, ITS TIMELY SUPPORT, ITS CONSTRUCTNE EFFORTS TO PROVIDE INFORMATION AND ADVICE IN FOSTERING PROJECT DEVELOPMENT AND PARTICIPATING IN COOPERATIVE RAILROAD DESIGN EFFORTS THAT HAVE RESULTED IN SIGNIFICANT SAVINGS IN TERMS OF COSTS, FUTURE PLANNING AND DEVELOPMENT EFFORTS, CONSTRUCTION PROCESS IMPLEMENTATION, AND MANY OTHER ISSUES. DM&E HAS CONSCIOUSLY AGREED TO MITIGATION CONDITIONS FAR IN EXCESS OF THOSE SUPPORTED BY PAST PRECEDENT BECAUSE OF SIGNIFICANT VALUE PROVIDED BY CITY NOT ONLY WITH RESPECT TO THE DEVELOPMENT OF THE IMMEDIATE PROJECT, BUT ALSO FOR OTHER REASONS INCLUDING BUT NOT LIMITED TO PARTNERSHIP SUPPORT IN PROJECT CONSTRUCTION AND FUTURE OPERATIONS, AND OTHER 5UPPORT TO BE ACHIEVED THROUGH THE PARTNERSHIP PROCESS. AGREEMENTS AND CONCESSIONS PROVIDED HEREIN ARE BASED ON VALUE RECEIVED AND CONTRIBUTIONS MADE BY THE PARTIES HERETO. FOR THESE AND OTHER REASONS, THE PARTIES HERETO REQUEST THAT THIS AGREEMENT NOT BE CONSIDERED BY THE STB OR ANY OTHER PUBLIC BODY AS A BASIS FOR APPLYING THE CONDITIONS SET FORTH HEREIN OR ANY OTHER ASPECT OF THIS AGREEMENT TO THIRD PARTIES NOT A SIGNATORY TO THIS AGREEMENT, OR FOR ANY OTHER REASON WHATSOEVER UNLESS BY THE MUTUAL SPECIFIC WRITTEN CONSENT OF ALL SIGNATORIES HERETO. 8. Legally binding, successors in intexest. This Agreement shall be legally binding upon and shall inure to the benefits of the parties hereto, their licensees, successors and assigns. 9. Notice. Any written notice given under this Agreement shall be effective if delivered in person, sent by same day or overnight courier, or sent by mail on the date placed in the United States mail with proper postage and addtessed as follows: If to DM&E: President&Chief Executive Officer Dakota,Minnesota&Eastern Railroad Corporation 140 North Phillips Avenue P.O. Box 1260 Sioux Falls,South Dakota 57104 If to Ciry: Mayor City of Brookings . Ciry Hall 311 3rd Avenue Brookings,South Dakota 57006 10. Regulation. In the event that any portion of this Agreement is deemed to be inconsistent with or contrary to any controlling sta.tute, regulation, regulatory condition, or similax legal authority, such provision shall be null and void; but the remainder of the Agxeement shall remain in effect. In the event that any such inconsistent provision is deemed significant and material, the paxties (ot arbittation panel) shall replace it with a similar provision modified to comply with said controlling legal authority and to comply as closely as possible with the spirit and intent of this Agreement. 11. Arbitration. In the event City and DM&E cannot mutualty agree on the mea.ning, application, interpretation, objectives or compliance with respect to any of the terms, provisions or conditions of this Agreement, the patties shall submit to binding arbitration based on the rules of the American Arbitration Association (AAA). If the parties cannot agree upon an AAA qualified arbitrator, eithet party may petition the At3A to designate an arbitrator, and the arbitrator so designated shall decide the case. The axbitration panel shall have the right to fashion a remedy and award damages 109 consistent with the objecrives, rights and obligarions of this Agreement If the City violates this Agreement or otherwise fails to abide by its terms (e.g., not cooperate for the advancement of Project development or affirmative efforts to undermine commitment to the Project development), it will be subject to normal damages and it will automarically relieve DM&E of its obligations to the City hereunder (except that would not affect the STB imposed conditions). The rights and obligations of the parries will be enfoxceable through binding arbitration puYSUant to A�1t� rules. The decision of the Arbitrator shall be final, and shall not be subject to appeal. Agreed to this 28`'' day of March, 2006. DAKOTA,MINNESOTA &EASTERN CITY OF BROOKINGS RAILROAD CORPORATION by by its PRESIDENT&CEO its MAYOR APPENDIX 1 TO DM&E COMMUNITY PARTNERSHIP AGREEMENT WITH THE CITY OF BROOKINGS This Appendix 1 is incorporated into the Community Patmership Agreement (hereinafter "Partnership Agreement") between DM&E and the City of Brookings, SD (hexeinafter "City'7. This Append� 1 provides crossing-specific and othex details of DM&E's funding commitment for impxovements identified in this Appendix. Page references herein refex to pages in the attached aerial photo map book. T'his Append.i�c 1 provides additional detailed descriptions. In the event of an inconsistency between this detailed text and the brief text reference notes in the Community Plan presentation,this Append'u� 1 text shall control. 1. 22nd Avenue. Upon the achievement of 35 million net tons of coal txaffic (as per the procedure set forth in the PartneYShip Agreement), and upon (a) enactment of a City ordinance directing whisde free status consistent with the Par�ership Agreement and (b) demonstxation by the City that it has obtained federal or other commitments for the balance of funding, DM&E shall fund 100% of the normal and customary local cost share (up to a maximum of 10% of the total crossing device cost) fox the addition of gates or other requirements for whisde free status (as pex the pxocedure set forth in the Partnership Agteement), provided,however, that in the event that the City obtains the commitments set forth above at least six months prior to completion of Pxoject construction, DM&E shalt fund 100% of the nortnal and customary local cost share (up to a maximum of 10% of the total crossing device cost). In addition, DM&E shall be responsible for the ongoing maintenance of the gates and signal lights relating thereto. (page 7). 2. 17th Avenue. Upon the achievement of 35 million net tons of coal traffic (as per the procedure set forth in the Partnexship Agxeement), and upon (a) enactment of a City ordinance directing whisde free status consistent with the Parmership Agreement and (b) demonstration by the City that it has obtained federal ox other comxnitments for the balance of fianding, DM&E shall fund 100% of the normal and customary local cost share (up to a ina�mum of 10% of the total crossing device cost) for the addition of gates or other requirements for whisde fxee sta.tus (as per the procedure set forth in the Partnership Agreement), provided,howevex, that in the event that the City obtains the commitments set forth above at least six months prior to completion of Project construction, DM&E shall fund 100% of the normal and custoinary local cost shaxe (up to a ma�mum of 10% of the total crossing device cost). In addition, DM&E shall be responsible for the ongoing maintenance of the gates and signal lights relating thereto. (page 8). 3. Medary Avenue. Upon the achievement of 35 million net tons of coal traffic (as per the procedure set forth in the Partnership Agreement), and upon (a) enactment of a City ordinance directing whisde free sta.tus consistent with the Parmexship Agxeement and (b) demonstration by the City that it has obtained federal or other commitrnents for the balance of funding, DM&E shall fund 100% of the normal and customary local cost shaxe (up to a maximum of 10% of the total crossing device cost) for the addition of gates or other requirements for whisde free status (as per the pxocedute set forth in the Partnership Agxeement), pxovided,however, that in the event that the City obtains the commitments set forth above at least six months prior to complet'ton of Project construction, DM&E shall fund 100% of the normal and customary local cost shase (up to a ma�mum of 10% of the total crossing device cost). In addition, DM&E shall be responsible for the ongoing maintenance of the gates and signal lights relating thexeto. (page 11). 110 4. Main Avenue. Upon the achievement of 35 million net tons of coal traffic (as per the procedure set forth in the Partnership Agreement), and upon (a) enactment of a City ordinance directing whistle free status consistent with the Partnership Agreement and (b) demonstration by the Ciry that it has obtained federal or other commitments for the balance of funding, DM&E shall fund 100% of the normal and customary local cost share (up to a ina�xnum of 10% of the total crossing device cost) for the addition of gates or othex xequirements for whistle free status (as pex the procedure set forth in the Partnership Agreement), provided,however, that in the event that the City obtains the commitments set forth above at least six months prior to completion of Project construction, DM&E shall fund 100% of the normal and customary local cost share (up to a ma�xnum of 10% of the total crossing device cost). In addition, DM&E shall be responsible for the ongoing maintenance of the gates and signal lights relating thereto. (page 12). 5. Western Avenue. Upon the achievement of 35 million net tons of coal traffic (as per the pxocedure set forth in the Parmership Agreement), and upon (a) enactment of a Ciry ordinance ciixecting whistle free status consistent with the Partriership Agreement and (b) demonstration by the City that it has obtained federal or other commitments for the balance of funding, DM&E shall fund 100% of the normal and customary local cost share (up to a ma.�mum of 10% of the total crossing device cost) for the addition of gates or other requirements for whisde fxee status (as per the procedure set forth in the Partnership Agreement), provided,however, that in the event that the City obtains the commitments set forth above at least six months prior to completion of Project construction, DM&E shall fund 100% of the normal and customary local cost shate (up to a ma�mum of 10% of the total crossing device cost). In addition, DM&E shall be responsible for the ongoing maintenance of the gates and signal lights relating thereto. (page 13) 6. Ex�edited Whisde Free. In the event City desires to achieve whisde free status prior to the achievement of 35 million net tons of coal per year, DM&E will cooperate with City to achieve such status,with DM&E's portion of the funding being reimbursed to the City no later than the time when DM&E would be obligated to pay puxsuant to proceduxe set forth above. 7. Other issues. DM&E will cooperate in good faith with the City to facilitate any reasonable City effort to install and maintain fencing along the right of way, address safery and noise issues with respect to bike paths or walking trails, or any other safery related initiative the City determines to pursue. This Appendix 1 to the Parmership Agreement is verified by the parties on this _ day of March,2006. For DM&E For the Ciry Ad,journ. A motion was made by Whalep, seconded by Reed, to adjourn. All present voted yes;motion carried. Meeting adjourned at 9:31 p.m. - Ci of Br okings �Q aTr oFe unstemzan,Mayor ��T���o $.� �� ,��9y ^:z v+. 9 °:c� �O�t �y �� s o �/i Shari ornes,City Cle