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HomeMy WebLinkAbout06-14-22 City Commission Meeting Agenda & Packet MaterialsA.Call to Order - 6:00 PM - Commission Room, City Hall, 121 North Rouse B.Pledge of Allegiance and a Moment of Silence C.Changes to the Agenda D.Authorize Absence D.1 Authorize the Absence of Commissioner Christopher Coburn (Maas) E.Public Service Announcements E.1 City of Bozeman offices will be closed Monday, June 20 in observance of the Juneteenth Holiday. There will be no City Commission meeting on Tuesday, June 21. This is not a garbage holiday and pick up will be on the regularly scheduled day.(Maas) F.FYI THE CITY COMMISSION OF BOZEMAN, MONTANA REGULAR MEETING AGENDA Tuesday, June 14, 2022 This meeting will be held both in-person and also using Webex, an online videoconferencing system. You can join this meeting: Via Webex: Click the Register link, enter the required information, and click submit. Click Join Now to enter the meeting. Via Phone: This is for listening only if you cannot watch the stream, channel 190, or attend in-person United States Toll +1-650-479-3208 Access code: 2554 524 0133 If you are interested in commenting in writing on items on the agenda please send an email to agenda@bozeman.net prior to 12:00pm on the day of the meeting. Public comments will be accepted in-person during the appropriate agenda items. You may also comment by visiting the Commission's comment page. You can also comment by joining the Webex meeting. If you do join the Webex meeting, we ask you please be patient in helping us work through this hybrid meeting. As always, the meeting will be streamed through the Commission's video page and available in the City on cable channel 190. 1 G.Commission Disclosures H.Approval of Minutes H.1 Approve the regular meeting minutes from: April 26, 2022 May 3, 2022 May 10, 2022 May 17, 2022(Maas) I.Consent I.1 Accounts Payable Claims Review and Approval (Waters) I.2 Authorize the City Manager to Sign a Construction Agreement with Pace Painting LLC for Story Mansion Exterior Painting(Ziegler) I.3 Authorize City Manager to Sign a Professional Services Agreement with Ingram-Clevenger Inc for Story Mansion Exterior Repairs(Ziegler) I.4 Authorize City Manager to Sign a Professional Services Agreement with Jackson Contractor Group Inc for Facilities Projects(Ziegler) I.5 Authorize the Signature of the City Manager for a Schedule A Contract Revision with Vector Solutions for Learning Management Software Billing Cycle(Tozer) I.6 Authorize the City Manager to Sign a Change Order to the Task Order with Tetra Tech, Inc for Groundwater and Perimeter Methane Monitoring and Assessment of System Performance and Effectiveness at the Bozeman Story Mill Landfill for Fiscal Year 2022(Flammond) I.7 Ordinance 2108 Final Adoption Amending Well Use Requirement Update the City of Bozeman (City) Regulations to Conform to Revised Regulations of Montana Department of Natural Resources and Conservation, Application 22137(Rogers) J.Public Comment This is the time to comment on any matter falling within the scope of the Bozeman City Commission. There will also be time in conjunction with each agenda item for public comment relating to that item but you may only speak once. Please note, the City Commission cannot take action on any item which does not appear on the agenda. All persons addressing the City Commission shall speak in a civil and courteous manner and members of the audience shall be respectful of others. Please state your name and address in an audible tone of voice for the record and limit your comments to three minutes. K.Action Items K.1 Resolution 5420 Approving Certain Projects in the South Bozeman Technology Tax Increment Financing District as Technology Infrastructure Development Projects and Using Tax Increment Revenues or Tax Increment Revenue Bonds to Reimburse Eligible Costs of Such Projects; Approving a Related Development Agreement; and Making a Reimbursement Declaration(Fine) K.2 Ordinance 2118 Provisional Adoption Authorizing City Commission to Establish by 2 Resolution Criteria and Procedures for Remote Participation by Commissioners and Board Members and Resolution 5421 Establishing Criteria and Procedures for Remote Participation(Sullivan) K.3 Downtown Business Improvement District Fiscal Year 2023 Budget and Work Plan (Cope) K.4 Downtown Urban Renewal District Fiscal Year 2023 Budget and Work Plan (Staley) K.5 Midtown Urban Renewal District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report(Fine) K.6 Northeast Urban Renewal District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report(Fine) K.7 North Park Renewal District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report(Fine) K.8 Pole Yard Urban Renewal District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report(Fine) K.9 South Bozeman Technology District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report(Fine) K.10 FY2022-2023 City Manager Recommended Budget Highlights: Internal Service and Special Revenue Funds(Mihelich) L.FYI / Discussion M.Adjournment City Commission meetings are open to all members of the public. If you have a disability that requires assistance, please contact our ADA Coordinator, Mike Gray, at 582-3232 (TDD 582-2301). Commission meetings are televised live on cable channel 190 and streamed live at www.bozeman.net. City Commission meetings are re-aired on cable Channel 190 Wednesday night at 4 p.m., Thursday at noon, Friday at 10 a.m. and Sunday at 2 p.m. In order for the City Commission to receive all relevant public comment in time for this City Commission meeting, please submit via www.bozeman.net or by emailing agenda@bozeman.net no later than 12:00 PM on the day of the meeting. Public comment may be made in person at the meeting as well. 3 Memorandum REPORT TO:City Commission FROM:Taylor Chambers, Deputy City Clerk Mike Maas, City Clerk Jeff Mihelich, City Manager SUBJECT:Authorize the Absence of Commissioner Christopher Coburn MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Administration RECOMMENDATION:I move to authorize the absence of Commissioner Christopher Coburn. STRATEGIC PLAN:1.1 Outreach: Continue to strengthen and innovate in how we deliver information to the community and our partners. BACKGROUND:Commissioner Christopher Coburn informed City Manager Mihelich that he would not be in attendance. UNRESOLVED ISSUES:None ALTERNATIVES:None FISCAL EFFECTS:None Report compiled on: May 6, 2022 4 Memorandum REPORT TO:City Commission FROM:Mike Maas, City Clerk SUBJECT:City of Bozeman offices will be closed Monday, June 20 in observance of the Juneteenth Holiday. There will be no City Commission meeting on Tuesday, June 21. This is not a garbage holiday and pick up will be on the regularly scheduled day. MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Administration RECOMMENDATION:Inform holiday hours STRATEGIC PLAN:1.1 Outreach: Continue to strengthen and innovate in how we deliver information to the community and our partners. BACKGROUND:n/a UNRESOLVED ISSUES:n/a ALTERNATIVES:none FISCAL EFFECTS:none Report compiled on: June 8, 2022 5 Memorandum REPORT TO:City Commission FROM:Taylor Chambers, Deputy City Clerk Mike Maas, City Clerk Jeff Mihelich, City Manager SUBJECT:Approve the regular meeting minutes from: April 26, 2022 May 3, 2022 May 10, 2022 May 17, 2022 MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Minutes RECOMMENDATION:I move to approve the combined City Commission minutes as submitted. STRATEGIC PLAN:1.1 Outreach: Continue to strengthen and innovate in how we deliver information to the community and our partners. BACKGROUND:In 2013, The Clerk’s Office identified goals related to the Commission’s priority of Improving Technology Utilization and Proficiency. Improvements included: • Live streaming broadcast of the City Commission Meeting • Meeting efficiency • Better access of meeting information for staff and the public • Time savings • Streamlined approach to citizen involvement and public comment From August of 2013 through December 2020, the City Commission Minutes have been linked with audio and video using AV Capture. In addition to the City Commission, many Citizen Advisory Boards utilize the system as well. Beginning December 14, 2020 the City Commission and many Citizen Advisory Boards moved to our new Granicus Streaming Platform. Beginning January 5, 2021 meetings in the Granicus platform have been closed captioned. Those captions are searchable using the advanced search option on our video view page. Users are always welcome to contact the City Clerk’s Office at 582-2320 or email agenda@bozeman.net for assistance. 6 UNRESOLVED ISSUES:None ALTERNATIVES:As suggested by the City Commission. FISCAL EFFECTS:None Attachments: 05-17-22 City Commission Meeting Minutes.pdf 05-10-22 City Commission Meeting Minutes.pdf 05-03-22 City Commission Meeting Minutes.pdf 04-26-22 City Commission Meeting Minutes.pdf Report compiled on: May 17, 2022 7 Bozeman City Commission Meeting Minutes, May 17, 2022 Page 1 of 6 THE CITY COMMMISSION MEETING OF BOZEMAN, MONTANA MINUTES Tuesday, May 17, 2022 Present: Cyndy Andrus, Terry Cunningham, I-Ho Pomeroy, Jennifer Madgic, Christopher Coburn Absent: None Staff Present at the Dais: City Manager (CM) Jeff Mihelich, City Attorney (CA) Greg Sullivan, City Clerk (CC) Mike Maas A) 00:02:36 Call to Order - 6:00 PM - Commission Room, City Hall, 121 North Rouse B) 00:04:57 Pledge of Allegiance and a Moment of Silence C) 00:05:35 Changes to the Agenda There were no changes to the agenda. D) 00:05:45 FYI • DM Cunningham noted the DEI training today and recommended it to all that are offered. • CM Mihelich highlighted the downtown parking survey on Engage Bozeman and introduced our new Transportation & Engineering Director, Nicholas Ross. • Director Ross provided a brief introduction of himself. E) 00:08:21 Commission Disclosures There were no disclosures. F) 00:08:27 Consent F.1 Accounts Payable Claims Review and Approval F.2 Authorize the City Manager to Sign Temporary Construction Permits and Right-of-Way Documents with DDS Investments, LLC for the Griffin Drive and Manley Road Street and Stormwater Improvements Project 20220517_DDS_ROW agreements for city signature.pdf 8 Bozeman City Commission Meeting Minutes, May 17, 2022 Page 2 of 6 F.3 Authorize the City Manager to Sign Temporary Construction Permits and Right-of-Way Documents with Glen Lake Holdings, LLC for the Griffin Drive and Manley Road Street and Stormwater Improvements Project 20220517_Glen Lake Holdings_ROW agreements for city signature.pdf F.4 Authorize the City Manager to Sign a Professional Services Agreement with Corrpro (Aegion) for Annual Inspection of the Hilltop Tank Cathodic Protection System PSA with Corrpro 2022 and exhibit final.pdf F.5 Authorize the City Manager to Sign an Addendum to the Professional Services Agreement with Clean Slate Group, LLC for Graffiti Removal Services First Addendum for Clean Slate Group 21- Professional Services Agreement - Clean Slate Group, LLC - Grafiti Abatement Services F.6 Ordinance 2107 Final Adoption Authorizing Fire Chief to Issue Burn Ban When Necessary ORDINANCE 2107 Burn Ban.pdf 00:08:28 City Manager Introduction CM Mihelich presented the highlights of the Consent Agenda. 00:09:15 Public Comment There were no public comments on the Consent Agenda 00:09:41 Motion Consent Items 1 - 6 as submitted. Christopher Coburn: Motion Terry Cunningham: 2nd 00:09:48 Vote on the Motion to approve Consent Items 1 - 6 as submitted. The Motion carried 5 – 0. Approve: Cyndy Andrus Terry Cunningham I-Ho Pomeroy Jennifer Madgic Christopher Coburn Disapprove: None G) 00:10:00 Public Comment Mayor Andrus opened general public comments. 00:10:48 Chris Brizzolara, Public Comment 9 Bozeman City Commission Meeting Minutes, May 17, 2022 Page 3 of 6 Chris Brizzolara commented on updating Division 10 to codify minimum wages of City of Bozeman employees. He commented to tax short term rentals to pay for the increases. 00:14:01 Marcia Kaveney, Public Comment Marcia Kaveney commented on the Community Development Board (CDB) meeting discussions from last night related to the Ordinance on departures for housing. 00:17:58 Mary Wictor, Public Comment Mary Wictor commented in agreement with Marcia Kaveney and provided additional comments related to the CDB meeting review of Ordinances at last night's meeting. 00:21:51 Rick Rollins, Public Comment Rick Rollins commented in agreement with previous comments related to wages, in favor of wars, that Bozeman is a great place for people that already have, in support of the victims in New York, and in opposition to the Democratic Party. H) 00:24:46 Special Presentation H.1 00:25:08 One Valley Community Foundation's A Seat at the Table Tanya Andreasen presented the results of the Seat at the Table efforts for housing solutions in Gallatin County. I) 00:46:17 Action Items I.1 00:49:18 Resolution 5381 Creation of Special Improvement Lighting District 771, Bozeman CoHousing Resolution 5381-Creation of SILD 771.doc 00:46:33 Staff Presentation Interim Finance Director Rachel Harlow-Schalk presented the lighting district. 00:48:45 Questions of Staff 00:48:58 Public Comment There were no public comments. 00:49:22 Motion to Adopt Commission Resolution No. 5381 / Creation of Special Improvement Lighting District #771, Bozeman CoHousing Terry Cunningham: Motion I-Ho Pomeroy: 2nd 00:49:41 Discussion 10 Bozeman City Commission Meeting Minutes, May 17, 2022 Page 4 of 6 00:51:08 Vote on the Motion to approve Adopt Commission Resolution No. 5381 / Creation of Special Improvement Lighting District #771, Bozeman CoHousing. The Motion carried 5 – 0. Approve: Cyndy Andrus Terry Cunningham I-Ho Pomeroy Jennifer Madgic Christopher Coburn Disapprove: None I.2 00:51:21 Ordinance 2110 Final Adoption Amending the City's Outdoor Water Use Restrictions by Establishing Permanent Restrictions on Time of Day and Day of the Week and Creating Exemptions from Said Restrictions, Establishing the City's Drought Contingency Response, Including Authorizing the City Manager to Declare a Drought, Providing for Drought Surcharge Rates During a Drought, and Establishing Standards for Use of City Utility Water During a Declared Drought Ordinance 2110_FINAL.pdf 00:51:36 Questions of Staff 00:55:28 Public Comment There were no public comments. 00:55:50 Motion adopt Ordinance 2110. I-Ho Pomeroy: Motion Jennifer Madgic: 2nd 00:55:56 Discussion 00:58:28 Motion to amend Section 40.02.190.B.2, the time of day watering prohibition, to state the outdoor watering of landscapes with the use of spray irrigation is prohibited seven days a week between the hours of 10 am and 8 pm. Christopher Coburn: Motion Terry Cunningham: 2nd 00:58:51 Discussion 11 Bozeman City Commission Meeting Minutes, May 17, 2022 Page 5 of 6 00:59:39 Vote on the Motion to amend Section 40.02.190.B.2, the time of day watering prohibition, to state the outdoor watering of landscapes with the use of spray irrigation is prohibited seven days a week between the hours of 10 am and 8 pm. The Motion carried 5 – 0. Approve: Cyndy Andrus Terry Cunningham I-Ho Pomeroy Jennifer Madgic Christopher Coburn Disapprove: None 01:00:27 Motion to amend Section 40.02.190.B.2 to identify the allowable watering window. Christopher Coburn: Motion Terry Cunningham: 2nd 01:01:00 Discussion 01:02:33 Vote on the Motion to amend Section 40.02.190.B.2 to identify the allowable watering window. The Motion carried 5 – 0. Approve: Cyndy Andrus Terry Cunningham I-Ho Pomeroy Jennifer Madgic Christopher Coburn Disapprove: None 01:02:43 Discussion on the Main Motion continued 01:11:29 Vote on the Motion to adopt Ordinance 2110. The Motion carried 5 – 0. Approve: Cyndy Andrus Terry Cunningham I-Ho Pomeroy 12 Bozeman City Commission Meeting Minutes, May 17, 2022 Page 6 of 6 Jennifer Madgic Christopher Coburn Disapprove: None J) 01:11:42 FYI / Discussion K) 01:11:47 Adjournment ___________________________________ Cynthia L. Andrus Mayor ATTEST: ___________________________________ Mike Maas City Clerk PREPARED BY: ___________________________________ Mike Maas City Clerk Approved on: June 14, 2022 13 Bozeman City Commission Meeting Minutes, May 10, 2022 Page 1 of 9 THE CITY COMMMISSION MEETING OF BOZEMAN, MONTANA MINUTES Tuesday, May 10, 2022 Present: Cyndy Andrus, Terry Cunningham, Jennifer Madgic, Christopher Coburn Absent: I-Ho Pomeroy Staff Present at the Dais: City Manager (CM) Jeff Mihelich, City Attorney (CA) Greg Sullivan, Deputy City Clerk (DCC) Taylor Chambers, Community Development Technician Jonathan Fuller A) 00:00:08 Call to Order - 6:00 PM - Commission Room, City Hall, 121 North Rouse B) 00:02:35 Pledge of Allegiance and a Moment of Silence C) 00:03:23 Changes to the Agenda • City Manager Mihelich informed the Commission that they will have to authorize the absence of Commissioner Pomeroy. 00:03:39 Authorize Absence 00:03:45 Motion the absence of Commissioner Pomeroy. Terry Cunningham: Motion Jennifer Madgic: 2nd 00:03:52 Vote on the Motion to approve the absence of Commissioner Pomeroy. The Motion carried 4 – 0. Approve: Cyndy Andrus Terry Cunningham Jennifer Madgic 14 Bozeman City Commission Meeting Minutes, May 10, 2022 Page 2 of 9 Christopher Coburn Disapprove: None D) 00:04:03 FYI • Deputy Mayor Cunningham informed the Commission that the Sustainability Board will be meeting tomorrow. He then applauded to the City for the work they did to clear the road after the most recent snow storm. • CM Mihelich informed the Commission that Frank Greenhill, Storm Water Specialist, received an award from the Montana Department of Environmental Quality for Excellence at the Montana Storm Water Conference in Missoula. He also informed the Commission that there was a ribbon cutting for a Hyundai Research and Development facility this week and commended Economic Development Director Brit Fontenot for his hard work on the project, noting that the project likely would not have come to fruition without him. E) 00:06:40 Commission Disclosures There were no disclosures. F) 00:06:35 Consent F.1 Accounts Payable Claims Review and Approval F.2 Bozeman Gateway Phase 4 Final Plat, Application 22002 Final Plat Commission Memo.pdf 002 Findings of Fact - Bozeman Gateway Phase 4, App 19436.pdf Bozeman Gateway Ph 4 FP.pdf Improvements Agreement F.3 Authorize the City Manager to Sign a Professional Services Agreement with Route 1 Professional Services Agreement with Route 1-May 2022.docx F.4 Authorize the City Manager to Enter into a Professional Services Agreement with D.A. Davidson & Co. for Underwriting Services to Issue Bonds for the Relocation of Fire Station Number 2 and Improvements at Bogert Pool, the Swim Center, and Lindley Recreation Center MEMORANDUM - AUTHORIZE THE CITY MANAGER TO SIGN A PROFESSIONAL SERVICES AGREEMENT WITH D.A. DAVIDSON & CO. TO UNDERWRITE 2022 SERIES G.O. BONDS.pdf CONTRACT -PROFESSIONAL SERVICES AGREEMENT WITH D.A. DAVIDSON & CO TO UNDERWRITE G.O. BONDS SERIES 2022.pdf CONTRACT Exhibit A - D A Davidson Response to RFP - City of Bozeman (Final).pdf F.5 Authorize the City Manager to Sign a First Amendment to the Professional Services Agreement with the Downtown Business Improvement District First PSA Amendment for Garage Cleaning Services with the Downtown Business Improvement District.docx 15 Bozeman City Commission Meeting Minutes, May 10, 2022 Page 3 of 9 F.6 Resolution 5382 Adopting the Billings Clinic Bozeman Campus Annexation Adjacent to Davis Lane and South of Westlake Road, and Authorize the City Manager to Sign the Annexation Agreement, Application 20132 Bozeman Campus Annexation Agreement SIgned 04.21.22.pdf Resolution 5382 Billings Clinic ANNX.pdf 15063_01_ANNEX_MAP_032222.pdf F.7 Resolution 5405 Relating to $9,010,000 in General Obligation Bonds, Series 2022; Authorizing the Issuance and Private Sale Thereof as Approved by Voters in November 2021 MEMORANDUM - RESOLUTION NO 5405 RELATING TO $9,010,000 IN GENERAL OBLIGATION BONDS, SERIES 2022.pdf RESOLUTION NO 5405 Calling for Neg Sale Bonds Relating to $9,010,000 in G.O. Bond Series 2022.pdf F.8 Ordinance 2102 Provisional Adoption of Billings Clinic Annexation Zone Map Amendment Establishing B-2 Community Business District on 4.7346 Acres Adjacent to Davis Lane and South of Westlake Road in Conjunction with Annexation, Application 20132 Ordinance 2102 Billings Clinic ZMA.pdf 15063_01_ZONE_MAP_AMENDMENT_032222.pdf 00:06:48 City Manager Introduction CM Mihelich provided the highlights of the Consent Agenda. 00:07:27 Public Comment There were no public comments on the Consent Agenda. 00:07:54 Motion to approve consent items 1-8 as submitted. Jennifer Madgic: Motion Christopher Coburn: 2nd 00:08:05 Vote on the Motion to approve consent items 1-8 as submitted. The Motion carried 4 – 0. Approve: Cyndy Andrus Terry Cunningham Jennifer Madgic Christopher Coburn Disapprove: None 16 Bozeman City Commission Meeting Minutes, May 10, 2022 Page 4 of 9 G) 00:08:15 Public Comment Mayor Andrus opened general public comments. 00:09:10 Zach Brown, Public Comment Zach Brown provided both verbal and written comments on the Board of Health Inter-Local agreement. 00:13:10 Riley Rivers, Public Comment Riley Rivers commented in opposition of Ordinance 2110. H) 00:17:07 Special Presentation H.1 Seventh Quarterly Report on Bozeman as an Inclusive City 5-4-22 FINAL Inclusive City Report May 2022.pdf 00:17:14 Staff Presentation City Manager Mihelich presented the Inclusive City Quarterly report to the Commission. I) 00:24:18 Action Items I.1 00:24:22 Consolidated Citizen Advisory Board Work Plans for 2022-2023 Sustainability Approved Work Plan.pdf Community Development Approved Work Plan.pdf Economic Vitality Approved Work Plan.pdf Transportation Advisory Board Work Plan 2022-2023.pdf Urban Parks & Forestry Advisory Board Work Plan 22-23 Final.pdf 00:24:47 Staff Presentation City Manager Mihelich presented the Transportation Advisory Board Work Plan to the Commission. 00:27:47 Questions of Staff 00:30:08 Staff Presentation Planning Manager Chris Saunders presented the Community Development Board Work Plan to the Commission. 00:32:59 Questions of Staff 00:36:31 Staff Presentation Strategic Services Director Jon Henderson presented the Sustainability Work Plan to the Commission. 00:40:35 Questions of Staff 00:42:23 Staff Presentation 17 Bozeman City Commission Meeting Minutes, May 10, 2022 Page 5 of 9 Parks and Recreation Director Mitch Overton presented the Urban Parks and Forestry Board Work Plan to the Commission. 00:46:36 Questions of Staff 00:52:24 Staff Presentation Economic Development Specialist Jesse DiTommaso presented the Economic Vitality Board Work Plan to the Commission. 00:53:55 Questions of Staff 00:56:27 Public Comment 00:56:55 Rick Gayle, Public Comment Rick Gayle commended the City on their efforts and dedication to veterans in the City. 00:58:45 Motion accept the Citizen Advisory Board Work Plans for 2022-2023 as submitted. Christopher Coburn: Motion Terry Cunningham: 2nd 00:58:56 Discussion 01:07:04 Vote on the Motion to accept the Citizen Advisory Board Work Plans for 2022-2023 as submitted. The Motion carried 4 – 0. Approve: Cyndy Andrus Terry Cunningham Jennifer Madgic Christopher Coburn Disapprove: None I.2 01:07:17 Resolution 5389 Creation of Special Improvement Lighting District 772, Blackwood Groves Resolution 5389-Creation of SILD 772 .doc 01:07:35 Staff Presentation Interim Finance Director Rachel Harlow-Schalk presented Resolution 5389 to the Commission. 18 Bozeman City Commission Meeting Minutes, May 10, 2022 Page 6 of 9 01:10:42 Questions of Staff 01:11:45 Public Comment There were no requests for public comment. 01:12:19 Motion to Adopt Commission Resolution No. 5389 / Creation of Special Improvement Lighting District #772, Blackwood Groves Terry Cunningham: Motion Jennifer Madgic: 2nd 01:12:43 Vote on the Motion to Adopt Commission Resolution No. 5389 / Creation of Special Improvement Lighting District #772, Blackwood Groves. The Motion carried 4 – 0. Approve: Cyndy Andrus Terry Cunningham Jennifer Madgic Christopher Coburn Disapprove: None I.3 01:12:56 Resolution 5383 Extension of Services Plan and Report for City-Initiated Annexations Resolution 5383 Adopting Extension of Services Plan 4 20 22.pdf Extension of Servcies Plan FINAL 5 10 22 gs.pdf Map of Wholly Surrounded Areas of the City.pdf Letter from Matt Kelley 2 28 20 Re Public Health Impact of Potential Annexation.pdf 01:13:17 Staff Presentation City Attorney Greg Sullivan presented Resolution 5383 to the Commission. 01:38:36 Questions of Staff 02:36:41 Public Comment There were no requests for public comment 02:37:37 Motion adopt Resolution 5383 - adopting the City of Bozeman Extension of Services Plan and Report for City-Initiated Annexations Jennifer Madgic: Motion 19 Bozeman City Commission Meeting Minutes, May 10, 2022 Page 7 of 9 Christopher Coburn: 2nd 02:38:06 Discussion 02:43:00 Motion Policy 34 that the sentence be amended to state "the city's affordable housing plans and policies will be considered in making annexation decisions, and the City's affordable housing program..." Terry Cunningham: Motion Jennifer Madgic: 2nd 02:43:13 Discussion on the Amendment 02:44:40 Vote on the Motion to amend Policy 34 that the sentence be amended to state "the city's affordable housing plans and policies will be considered in making annexation decisions, and the City's affordable housing program..." The Motion carried 4 – 0. Approve: Cyndy Andrus Terry Cunningham Jennifer Madgic Christopher Coburn Disapprove: None 02:44:53 Discussion on the Main Motion continued 02:49:23 Vote on the Motion to adopt Resolution 5383 - adopting the City of Bozeman Extension of Services Plan and Report for City-Initiated Annexations. The Motion carried 4 – 0. Approve: Cyndy Andrus Terry Cunningham Jennifer Madgic Christopher Coburn Disapprove: None J) 02:49:45 Appointments J.1 Appointment to the Police Commission 20 Bozeman City Commission Meeting Minutes, May 10, 2022 Page 8 of 9 02:49:46 Public Comment There were no requests for public comment. 02:50:09 City Manager Appointment 02:50:38 Motion to appoint Rick Gayle to the Police Commission with a term expiring 2025. Christopher Coburn: Motion Terry Cunningham: 2nd 02:51:03 Vote on the Motion to appoint Rick Gayle to the Police Commission with a term expiring 2025. The Motion carried 4 – 0. Approve: Cyndy Andrus Terry Cunningham Jennifer Madgic Christopher Coburn Disapprove: None K) 02:51:12 FYI / Discussion Cr. Coburn acknowledged Rick Gayle and voiced his appreciation. L) 02:51:47 Adjournment ___________________________________ Cynthia L. Andrus Mayor ATTEST: ___________________________________ Mike Maas City Clerk 21 Bozeman City Commission Meeting Minutes, May 10, 2022 Page 9 of 9 PREPARED BY: ___________________________________ Taylor Chambers Deputy City Clerk Approved on: June 14, 2022 22 Bozeman City Commission Meeting Minutes, May 3, 2022 Page 1 of 10 THE CITY COMMMISSION MEETING OF BOZEMAN, MONTANA MINUTES Tuesday, May 3, 2022 DUE TO TECHNICAL DIFFICULTIES THERE IS NO AUDIO FOR THE BEGINNING PORTIONS OF THE MEETING. AUDIO RESUMES FOR AGENDA ITEM K.3 Present: Cyndy Andrus, Jennifer Madgic, Christopher Coburn Absent: Terry Cunningham, I-Ho Pomeroy Staff Present at the Dais: City Manager (CM) Jeff Mihelich, City Attorney (CA) Greg Sullivan, and City Clerk (CC) Mike Maas A) 00:01:16 Call to Order - 6:00 PM - Commission Room, City Hall, 121 North Rouse B) 00:03:16 Pledge of Allegiance and a Moment of Silence C) 00:03:50 Changes to the Agenda • CM Mihelich noted two changes: adding the absence of DM Cunningham and the removal of K.5 due to changes in the drought score. • Mayor Andrus requested moving K.3 to before K.2. D) 00:06:14 Authorize Absence D.1 00:06:16 Authorize the Absence of Commissioner I-Ho Pomeroy 00:06:36 Motion I move to authorize the absence of Commissioner I-Ho Pomeroy and Deputy Mayor Terry Cunningham. Christopher Coburn: Motion Jennifer Madgic: 2nd 23 Bozeman City Commission Meeting Minutes, May 3, 2022 Page 2 of 10 00:06:36 Vote on the Motion I move to authorize the absence of Commissioner I-Ho Pomeroy and Deputy Mayor Terry Cunningham. The Motion carried 3 – 0. Approve: Cyndy Andrus Jennifer Madgic Christopher Coburn Disapprove: None E) 00:06:39 Public Service Announcements E.1 00:06:42 Recently Approved Citizen Advisory Board Minutes F) 00:06:52 FYI • Mayor Andrus acknowledged that Communications Manager Melody Mileur has moved on from the City and spoke highly of her time at the City. She reminded the public that this is Historic Preservation Month and Bike to Work Week. • CM Mihelich highlighted that the Climate Action Plan Dashboard is live on the website; the City won "Best Tasting" water in the state of Montana and is moving on to the national competition; the Public Library and Food Bank are partnering to provide a food pantry in the atrium of the Library; noted the street closures and work map on the website; and lastly, provided recognition of the County Commission. G) 00:10:08 Commission Disclosures There were no disclosures. H) 00:10:12 Consent H.1 Accounts Payable Claims Review and Approval H.2 Authorize the Destruction of Municipal Records in accordance with MCA, 7-5-4124 as approved by the Local Records Committee per MCA 2-6-1202 Bozeman-City-MikeM-092121-JK-092121-MR-092121 MR signed.pdf Bozeman 2021-4-02232022080120.pdf Bozeman-City-MikeM-083121-JK-090121-MR-090121 signed.pdf H.3 Authorize the City Manager to Sign a Conditional Irrevocable Offer of Dedication with Swissdetail, Inc. for the Swiss detail Site Plan and Master Site Plan (20371 and 20372) Conditional Irrevocable Offer of Dedication H.4 Authorize the City Manager to Sign Temporary Construction Permits and Right-of-Way Documents with HRDC for the Griffin Drive and Manley Road Street and Stormwater Improvements Project 20220503_HRDC ROW Agreements for City signature.pdf 24 Bozeman City Commission Meeting Minutes, May 3, 2022 Page 3 of 10 H.5 Authorize City Manager to Sign Payment Agreement with Bozeman Fiber, Inc. (dba Yellowstone Fiber) for City Costs for Engineering Services for the Yellowstone Fiber for the Fiber-to-the-Premises Broadband Project 220412_Payment Agreement_City of Bozeman_Yellowstone Fiber.pdf PSA_Engineering_Fiber_Buildout_March_11_2022_V2.pdf H.6 Authorize the City Manager to Sign a Professional Services Agreement with FOS of CannonDesign for Facilities Condition Assessment Services Professional Services Agreement - FOS of CannonDesign - Facilities Condition Assessment.pdf H.7 Authorize the City Manager to Sign a Task Order 3 with Baker Tilly Municipal Advisors for Financial Feasibility and Needs Analysis on Tax Increment Financing Assistance Request from Charter Realty and Development Task Order 3.pdf Bozeman Proposed MSUIC TIF Project Financial Needs Analysis Scope of Work 041922.pdf H.8 Authorize the City Manager to Sign a Fourth Amendment to the Granicus Service Agreement for Upgrades to High Definition Streaming 4th Amendment to Granicus Service Agreement.pdf H.9 Authorize the City Manager to Sign a Task Order EDD22-001 with Sanderson Stewart for On-Call Engineering Services URD Task Order Form EDD22-001.docx Charge_Out_Rates_Combined_2022.pdf 00:10:18 City Manager Introduction CM Mihelich provided the highlights of the Consent Agenda. 00:10:46 Public Comment There were no comments on the Consent Agenda. 00:11:40 Motion Consent Items 1 - 9 as submitted. Jennifer Madgic: Motion Christopher Coburn: 2nd 00:11:40 Vote on the Motion to approve Consent Items 1 - 9 as submitted. The Motion carried 3 – 0. Approve: Cyndy Andrus Jennifer Madgic Christopher Coburn Disapprove: None 25 Bozeman City Commission Meeting Minutes, May 3, 2022 Page 4 of 10 I) 00:11:43 Public Comment There were no general public comments. J) 00:13:08 Mayoral Proclamation J.1 00:13:09 Proclaiming National Small Business Week Mayor Andrus provided the Small Business Week Proclamation. Small Business Week.docx K) 00:16:03 Action Items K.1 00:16:04 Cable and Facilities Easement and Agreement with Yellowstone Fiber (formerly Bozeman Fiber) cc memo 5.3.22 Cable and Facilities Easement YF FINAL 4.20.22.doc.pdf 220418_Cable and Facilities Easement _Exhibits A-O.pdf YellowstoneFiberHutLocations.pdf 00:16:17 Staff Presentation CA Sullivan presented the agreement and easements for the fiber huts, primarily located in City parks. 00:20:26 Questions 00:37:17 Public Comment There were no public comments on this item. 00:38:01 Motion Authorize the Mayor, or their designee, to sign the Cable and Facilities Easement and Agreement with Yellowstone Fiber (formerly Bozeman Fiber). Christopher Coburn: Motion Jennifer Madgic: 2nd 00:38:03 Discussion 00:40:43 Vote on the Motion Authorize the Mayor, or their designee, to sign the Cable and Facilities Easement and Agreement with Yellowstone Fiber (formerly Bozeman Fiber). The Motion carried 3 – 0. Approve: Cyndy Andrus Jennifer Madgic Christopher Coburn Disapprove: None 26 Bozeman City Commission Meeting Minutes, May 3, 2022 Page 5 of 10 00:40:56 Mayor Andrus called the meeting into recess to address the technical issues. 00:46:15 Mayor Andrus called the meeting back to order. K.3 00:46:22 Ordinance 2110 Provisional Adoption Amending the City’s Outdoor Water Use Restrictions by Establishing Permanent Restrictions on Time of Day and Day of the Week and Creating Exemptions from Said Restrictions, Establishing the City’s Drought Contingency Response, Including Authorizing the City Manager to Declare a Drought, Providing for Drought Surcharge Rates During a Drought, and Establishing Standards for Use of City Utility Water During a Declared Drought Ord. 2110_Permanent Watering Restrictions and Drought Contingency Response.pdf 00:46:43 Staff Presentation Water Conservation Program Manager Jessica Ahlstrom presented the Ordinance. She presented the staff recommendations, the findings leading to those recommendations, the purpose of the Ordinance, new permanent watering restrictions, the drought contingency response. 01:00:47 Questions of Staff 01:24:41 Public Comment 01:25:22 Patti Steinmuller, Public Comment Patti Steinmuller commented in favor of the Ordinance. 01:27:37 Motion I move to provisionally adopt Ordinance 2110. Jennifer Madgic: Motion Christopher Coburn: 2nd 01:27:46 Discussion 01:32:00 Motion Ordinance 2110 to change time of day prohibitions (page six item two) to read "seven days a week between the hours of 10 am until midnight." Christopher Coburn: Motion Jennifer Madgic: 2nd 01:34:35 Discussion on the Amendment 01:40:30 Vote on the Motion to amend Ordinance 2110 to change time of day prohibitions (page six item two) to read "seven days a week between the hours of 10 am until midnight." The Motion carried 3 – 0. 27 Bozeman City Commission Meeting Minutes, May 3, 2022 Page 6 of 10 Approve: Cyndy Andrus Jennifer Madgic Christopher Coburn Disapprove: None 01:40:44 Motion to amend Ordinance 2110 in subsection three on page seven to reflect the change to prohibited hours in the previous amendment. Christopher Coburn: Motion Jennifer Madgic: 2nd 01:41:30 Vote on the Motion to amend Ordinance 2110 in subsection three on page seven to reflect the change to prohibited hours in the previous amendment. The Motion carried 3 – 0. Approve: Cyndy Andrus Jennifer Madgic Christopher Coburn Disapprove: None 01:41:38 Discussion on Main Motion 01:45:24 Vote on the Motion to provisionally adopt Ordinance 2110. The Motion carried 3 – 0. Approve: Cyndy Andrus Jennifer Madgic Christopher Coburn Disapprove: None 01:45:33 Recess Mayor Andrus called the meeting into a brief recess. 01:51:09 Call to Order 28 Bozeman City Commission Meeting Minutes, May 3, 2022 Page 7 of 10 Mayor Andrus called the meeting back to order. K.2 01:51:17 Resolution 5398 Adopting the City of Bozeman 2022 Drought Management Plan Resol. 5398_2022 Drought Management Plan.pdf 2022 Drought Management Plan FINAL.pdf 01:51:58 Staff Presentation Program Manager Ahlstrom presented the Resolution to adopt the 2022 Drought Management Plan, the plan's goal and objectives, the severity indicators, mitigation & response efforts, the guiding principles, the declaration authority, the drought monitoring tool, the drought management team, the drought surcharge & reserve rates for water usage, and the drought response program enforcement. 02:10:04 Questions of Staff 02:25:24 Public Comment Mayor Andrus opened this item for public comments. 02:25:58 Patti Steinmuller, Public Comment Pattie Steinmuller commented in favor of this plan. 02:27:02 Motion I hereby move that the City Commission pass, adopt and approve Resolution 5398, approving the adoption of the 2022 Drought Management Plan with the appendix to be amended to reflect the changes from the previous action item. Christopher Coburn: Motion Jennifer Madgic: 2nd 02:27:23 Discussion 02:28:03 Motion move to include the new objective to be inserted to subsection 1.1 as read by staff. Christopher Coburn: Motion Jennifer Madgic: 2nd 02:28:24 Discussion on the Amendment 02:29:17 Vote on the Motion to amend move to include the new objective to be inserted to subsection 1.1 as read by staff. The Motion carried 3 – 0. Approve: Cyndy Andrus 29 Bozeman City Commission Meeting Minutes, May 3, 2022 Page 8 of 10 Jennifer Madgic Christopher Coburn Disapprove: None 02:29:23 Discussion on the Original Motion continued 02:32:24 Vote on the Motion I hereby move that the City Commission pass, adopt and approve Resolution 5398, approving the adoption of the 2022 Drought Management Plan with the appendix to be amended to reflect the changes from the previous action item. The Motion carried 3 – 0. Approve: Cyndy Andrus Jennifer Madgic Christopher Coburn Disapprove: None K.4 02:32:31 Ordinance 2107 Provisional Adoption of Ordinance Authorizing Fire Chief to Issue Burn Ban When Necessary ORDINANCE 2107 Burn Ban.pdf 02:32:44 Staff Presentation Fire Chief Josh Waldo presented the Ordinance, the need for the Ordinance, an explanation of open burning & a burn ban, and the current process compared to the proposed process. 02:36:59 Questions of Staff 02:39:08 Public Comment There were no comments on this item. 02:39:33 Motion I move to provisionally adopt Ordinance 2107, granting authority to the Bozeman Fire Chief to issue burn bans as needed Jennifer Madgic: Motion Christopher Coburn: 2nd 02:39:37 Discussion 30 Bozeman City Commission Meeting Minutes, May 3, 2022 Page 9 of 10 02:40:42 Vote on the Motion to provisionally adopt Ordinance 2107, granting authority to the Bozeman Fire Chief to issue burn bans as needed. The Motion carried 3 – 0. Approve: Cyndy Andrus Jennifer Madgic Christopher Coburn Disapprove: None K.5 Resolution 5400 Declaring a Stage One Drought, Implementing Stage One Drought Response Measures and Stage One Drought Surcharges, and Authorizing the Bozeman City Manager to Issue or Rescind Additional Drought Stage Declarations and Drought Surcharges and Implement Additional Drought Response Measures through Administrative Orders Resol. 5400_May 2022 Stage One Drought Declaration.pdf L) 02:40:47 Appointments L.1 02:40:49 Appoint One Member to the City of Bozeman's Community Development Block Grant Revolving Loan Fund with a Term Ending in 2024 02:41:19 Public Comment There were no comments on this item. 02:41:38 Motion Appoint the Economic Development Specialist, Jesse DiTommaso, to the City of Bozeman's Community Development Block Grant Revolving Loan Fund with a term ending in 2024. Christopher Coburn: Motion Jennifer Madgic: 2nd 02:42:00 Vote on the Motion to Appoint the Economic Development Specialist, Jesse DiTommaso, to the City of Bozeman's Community Development Block Grant Revolving Loan Fund with a term ending in 2024. The Motion carried 3 – 0. Approve: Cyndy Andrus Jennifer Madgic Christopher Coburn Disapprove: None 31 Bozeman City Commission Meeting Minutes, May 3, 2022 Page 10 of 10 M) 02:42:07 FYI / Discussion CM Mihelich commented on the extraordinary work done by Jessica Ahlstrom. N) 02:42:53 Adjournment ___________________________________ Cynthia L. Andrus Mayor ATTEST: ___________________________________ Mike Maas City Clerk PREPARED BY: ___________________________________ Mike Maas City Clerk Approved on: June 14, 2022 32 Bozeman City Commission Meeting Minutes, Tuesday, April 26, 2022 Page 1 of 5 THE CITY COMMMISSION MEETING OF BOZEMAN, MONTANA MINUTES Tuesday, April 26, 2022 Due to technical issues with the meeting there is no audio or video recording available. Staff Present at the Dias: City Manager Jeff Mihelich, Assistant City Attorney Anna Saverud, Deputy City Clerk Taylor Chambers. A) 00:00:13 Call to Order - 6:00 PM - Commission Room, City Hall, 121 North Rouse Present: I-Ho Pomeroy, Jennifer Madgic, Christopher Coburn Absent: Cyndy Andrus, Terry Cunningham 00:00:52 Motion I nominate Commissioner Coburn to preside over the Commission Meeting. Jennifer Madgic: Motion I-Ho Pomeroy: 2nd 00:01:10 Vote on the Motion I nominate Commissioner Coburn to preside over the Commission Meeting. The Motion carried 3 - 0 Approve: I-Ho Pomeroy Jennifer Madgic Christopher Coburn Disapprove: None B) 00:03:26 Pledge of Allegiance and a Moment of Silence C) 00:04:05 Changes to the Agenda 33 Bozeman City Commission Meeting Minutes, Tuesday, April 26, 2022 Page 2 of 5 City Manager Mihelich informed the Commission that section D would have to be edited to include authorizing the absence of Mayor Andrus. D) 00:04:25 Authorize Absence D.1 Authorize the Absence of Deputy Mayor Terry Cunningham 00:04:37 Motion I move to authorize the absence of Mayor Andrus and Deputy Mayor Cunningham. Jennifer Madgic: Motion I-Ho Pomeroy: 2nd 00:04:57 Vote on the Motion to approve I move to authorize the absence of Mayor Andrus and Deputy Mayor Cunningham. The Motion carried 3 - 0 Approve: I-Ho Pomeroy Jennifer Madgic Christopher Coburn Disapprove: None E) 00:05:00 FYI City Manager Mihelich informed the Commission that the City recently hosted a job fair and were able to offer on the spot interviews and offers for short term workers. He also informed the Commission and the public that there will be several other career fairs put on by the City in the near future. F) 00:07:53 Commission Disclosures G) 00:07:59 Approval of Minutes G.1 Approve the regular meeting minutes from: March 1, 2022 March 22, 2022 April 5, 2022 April 12, 2022 April 19, 2022 03-01-22 City Commission Meeting Minutes.pdf 03-22-22 City Commission Meeting Minutes.pdf 04-05-22 City Commission Meeting Minutes.pdf 04-12-22 City Commission Meeting Minutes.pdf 04-19-22 City Commission Meeting Minutes.pdf 00:08:20 Motion G) Approval of Minutes I-Ho Pomeroy: Motion Jennifer Madgic: 2nd 34 Bozeman City Commission Meeting Minutes, Tuesday, April 26, 2022 Page 3 of 5 00:08:29 Vote on the Motion to approve G) Approval of Minutes. The Motion carried 3 - 0 Approve: I-Ho Pomeroy Jennifer Madgic Christopher Coburn Disapprove: None H) 00:08:32 Consent City Manager Mihelich highlighted item H.14 H.1 Accounts Payable Claims Review and Approval H.2 Authorize the City Manager to Sign a Release and Reconveyance of Easements with Eastlake Professional Center, LLC for the Subdivision Preliminary Plat Eastlake Professional Center (21447) Release and Reconveyance H.3 Authorize the City Manager to Sign Drainage Easements and a Sewer and Water Pipeline and Access Easement and Agreement with Rosa Johnson Development for the Boulder Creek Site Plan (19021) Drainage Easement 1 Drainage Easement 2 Sewer and Water Pipeline and Access Easement and Agreeement H.4 Authorize the City Manager to Sign a Conditional Irrevocable Offer of Dedication with Ives Property Owner, LLC for the Block 4 North Central Master Plan Conditional Irrevocable Offer of Dedication H.5 Authorize the City Manager to Sign a Conditional Irrevocable Offer of Dedication with VC Development, LLC for the Vance Thompson Vision Site Plan (21242) Conditional Irrevocable Offer of Dedication H.6 Authorize the City Manager to Sign Temporary Construction Permits with Edgerley Revocable Trust for the Griffin Drive and Manley Road Street and Stormwater Improvements Project 20220426_Edgerly Trust_Construction permits for city signature.pdf H.7 Authorize the City Manager to Sign a Fiscal Year 2023 Montana State University (MSU) Fire Service Agreement City of Bozeman FY 23 Interlocal Agreement - Montana State University (MSU) - Fire Safety Services.pdf H.8 Authorize the City Manager to Sign a Professional Services Agreement with Desman Engineering for a Maintenance Manual to support maintenance needs in the Bridger Parking Garage PSA_with_Desman_Design_Management_for_Parking_Garage_Maintenance_Manual.p df H.9 Authorize the City Manager to Sign a Professional Services Agreement with Morrison- Maierle, Inc. for Engineering Services to Design and Permit the Relocation of an Existing Ice Control Well Located Within the Basement of Fire Station 1 35 Bozeman City Commission Meeting Minutes, Tuesday, April 26, 2022 Page 4 of 5 Professional Service Agreement H.10 Authorize the City Manager to Sign a Professional Service Agreement with Constructive Solutions Inc. for Pre-construction Consulting and Design Services for the Renovation of the Lindley Center Professional Service Agreement - Constructive Solutions Inc. - Lindley Recreation Center Renovation Pre-Construction Consulting and Design.pdf H.11 Authorize the City Manager to Sign a Task Order 1 of the Professional Services Master Task Order Agreement with HDR Engineering, Inc. for Engineering Services to Design and Permit the East Gallatin River Streambank Erosion Protection Project, CIP WW111 Professional Service Agreement 22- Professional Services Master Agreement - HDR Engineering - On-call Engineering Services H.12 Authorize the City Manager to Sign a Task Order 2 with Baker Tilly Municipal Advisors for Financial Feasibility and Needs Analysis on Tax Increment Financing Assistance Request from Bozeman Lodging Group, LLC Bozeman Hotel Dev TIF Project Financial Needs Analysis Scope of Work Final.pdf H.13 Authorize the City Manager to Sign a Third Amendment to the Professional Services Agreement for Lobbying Services Third PSA Amendment for lobbying services with Central House Strategies.docx H.14 Ordinance 2100 Final Adoption Recognizing and Designating June 19th as Juneteenth National Freedom Day and Designating June 19th as the Local Juneteenth Holiday Ord. 2100 amended final.pdf 00:09:07 Public Comment Opportunity No requests were made for public comment. 00:09:41 Motion I move to approve consent items 1-14 as submitted. Jennifer Madgic: Motion I-Ho Pomeroy: 2nd 00:09:54 Vote on the Motion I move to approve consent items 1-14 as submitted. The Motion carried 3 - 0 Approve: I-Ho Pomeroy Jennifer Madgic Christopher Coburn Disapprove: None I) 00:10:01 Public Comment No requests were made for public comment. J) 00:12:05 Mayoral Proclamation Commissioner Coburn read the Arbor Day Proclamation. 36 Bozeman City Commission Meeting Minutes, Tuesday, April 26, 2022 Page 5 of 5 J.1 Mayoral Proclamation Proclaiming Arbor Day Bozeman Arbor Day Proclamation.docx K) 00:13:58 Special Presentation Natalie Meyer presented the second triannual report to the Commission. K.1 Triannual Climate Plan Report L) 00:31:11 FYI / Discussion M) 00:31:50 Adjournment City Commission meetings are open to all members of the public. If you have a disability that requires assistance, please contact our ADA Coordinator, Mike Gray, at 582-3232 (TDD 582-2301).Commission meetings are televised live on cable channel 190 and streamed live at www.bozeman.net. City Commission meetings are re-aired on cable Channel 190 Wednesday night at 4 p.m., Thursday at noon, Friday at 10 a.m. and Sunday at 2 p.m. ___________________________________ Cynthia L. Andrus Mayor ATTEST: ___________________________________ Mike Maas City Clerk PREPARED BY: ___________________________________ Taylor Chambers Deputy City Clerk Approved on: June 14, 2022 37 Memorandum REPORT TO:City Commission FROM:Nadine Waters, Accounts Payable Clerk Levi Stewart, Assistant City Controller Aaron Funk, City Controller Rachel Harlow-Schalk, Interim Finance Director SUBJECT:Accounts Payable Claims Review and Approval MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Finance RECOMMENDATION:City Commission approval is recommended for claims as presented. STRATEGIC PLAN:7.5. Funding and Delivery of City Services: Use equitable and sustainable sources of funding for appropriate City services, and deliver them in a lean and efficient manner. BACKGROUND:Montana Code Annotated, Section 7-6-4301 requires the City Commission to review claims prior to payment. Claims presented to the City Commission under this item have been reviewed and validated by the Finance Department. The Department has ensured that all goods and services have been received along with necessary authorizations and supporting documentation. Additionally, the Department confirmed all expenditures were appropriately coded and within the current fiscal year allocated budget. UNRESOLVED ISSUES:None ALTERNATIVES:The City Commission could decide not to approve these claims or a portion of the claims presented. This alternative is not recommended as it may result in unbudgeted late fees assessed against the City. FISCAL EFFECTS:The total amount of the claims to be paid is presented at the bottom of the Expenditure Approval List posted on the City’s website at https://www.bozeman.net/departments/finance/purchasing. Report compiled on: June 9, 2022 38 Memorandum REPORT TO:City Commission FROM:Max Ziegler, Facilities Project Coordinator Mike Gray, Facilities Superintendent Jon Henderson, Strategic Services Director SUBJECT:Authorize the City Manager to Sign a Construction Agreement with Pace Painting LLC for Story Mansion Exterior Painting MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Agreement - Vendor/Contract RECOMMENDATION:Authorize the City Manager to Sign a Construction Agreement with Pace Painting LLC for Story Mansion Exterior Painting. STRATEGIC PLAN:4.3 Strategic Infrastructure Choices: Prioritize long-term investment and maintenance for existing and new infrastructure. BACKGROUND:Story Mansion, acquired by the City in 2003, features extensive exterior painted wood surfaces and has not been fully repainted since last done in 2007. Current paint condition has degraded, with extensive peeling and cracking of exterior paint on siding and trim. The need for repainting this building has been identified in the City's Capital Improvement Program and provisions were designated to project GF301. A Request for Bids was published publicly, and the project has been awarded to the apparent low bidder. UNRESOLVED ISSUES:None. ALTERNATIVES:As suggested by City Commission. FISCAL EFFECTS:The total cost of this project is to be a fixed cost of $169,000, to be funded from the Recreation Department's capital improvement budget reserved for GF301. Attachments: Construction Agreement - Story Mansion Exterior Painting - Pace Painting LLC.pdf Report compiled on: June 2, 2022 39 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 1 of 16 CONSTRUCTION AGREEMENT This Construction Agreement is made and entered into this _____ day of ____________, 202__ (“Effective Date”), by and between the CITY OF BOZEMAN, MONTANA, a self- governing municipal corporation organized and existing under its Charter and the laws of the State of Montana, 121 North Rouse Street, Bozeman, Montana, with a mailing address of PO Box 1230, Bozeman, MT 59771, hereinafter referred to as “City,” and, Pace Painting LLC, 300 2nd Ave NE, East Grand Forks, MN 56271, hereinafter referred to as “Contractor.” The City and Contractor may be referred to individually as “Party” and collectively as “Parties.” In consideration of the covenants, agreements, representations, and warranties contained herein, the parties agree as follows: 1. Work to be Performed: a. A description of the work to be performed to repaint the exterior of Story Mansion, 811 S Willson Ave, Bozeman, MT 59715 (the “Construction Project”) and Contractor’s duties is set forth in the Scope of Services attached hereto as Exhibit A and by this reference made a part hereof, and in the drawings, plans, and specifications provided by the City, which are included in the Scope of Services attached hereto as Exhibit A. b. Prior to the commencement of any work on the Construction Project, Contractor’s representatives and City’s representatives shall hold a meeting to establish a working understanding among the parties as to the scope of the Construction Project and duties of the Contractor. At this meeting, Contractor and City shall resolve any outstanding issues related to the plans, designs, drawings, and specifications. If the parties are unable to resolve these issues and the City fails, refuses, or is unable to approve the same, no work shall commence on the Construction Project until such issues are resolved and the City approves the related plans, designs, drawings, and specifications. c. Except as provided elsewhere in this Agreement, Contractor shall furnish all the labor, materials, equipment, tools, and services necessary to perform and complete the Construction Project. d. During work on the Construction Project, and as part of the final completion of the Construction Project, Contractor shall clean up the Project site, including the removal and satisfactory disposal of all waste, garbage, excess materials, and equipment, and the performance of any other work necessary to restore the site to at least as good order and condition as at the commencement of the Construction Project. 40 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 2 of 16 2. City-Supplied Materials: The City may supply materials from time to time in furtherance of the Construction Project. Such materials will be noted as an addendum to this Agreement. 3. Time of Performance: Contractor shall begin the Construction Project after receiving a Notice to Proceed from City and shall complete the Construction Project no later than 12/30/2022. Time is of the essence of completion of all work and each phase of the Construction Project. 4. Liquidated Damages: If the Construction Project is not completed within the time provided by this Agreement, the City may deduct for each day the Construction Project remains uncompleted the sum of Five Hundred Dollars ($500.00) from the compensation hereinafter specified and retain that sum as payment for liquidated damages sustained by reason of the Contractor’s failure to complete the Construction Project on time. 5. Compensation: a. City shall pay to Contractor, and Contractor shall accept as full payment for the performance of this Agreement and the Construction Project, the amount of One Hundred and Sixty Nine Thousand Dollars ($169,000). b. If work not included within the original Construction Documents is requested by City, such additional work and the related compensation shall be agreed to in writing by both parties prior to commencement of the additional work (“Change Order”). c. City shall retain five percent (5%) of the total amount of compensation to be paid to the Contractor to ensure compliance with the terms and conditions of this Agreement and the timely completion of the Construction Project and any and all “punch list” items (“Retainage Amount”). The Retainage Amount shall be paid to Contractor thirty (30) days after the City’s final acceptance of the portion of work for which a separate price is stated in the specifications for the Construction Project. e. Upon acceptance of final payment and for other good and valuable consideration, Contractor shall and hereby does release and forever discharge City, its officers, agents, and employees of and from any and all claims, demands, actions, causes of action, obligations, and liabilities of every kind and character whatsoever, in law and in equity, whether now known or in the future discovered, arising from or related to this Agreement or the Construction Project that Contractor may have or assert against City, its officers, agents, and employees. 6. Inspection and Testing: a. City has the right to inspect and test any and all work performed by Contractor on the Construction Project. Contractor shall allow City and its agents access to the Construction Project at all times and shall provide every reasonable facility for the purpose of such inspection and testing, including temporarily discontinuing portions of the 41 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 3 of 16 work or uncovering or taking down portions of the finished work. Any inspection and testing performed by the City and its agents is for the sole benefit of the City and shall not relieve the Contractor of its duty, responsibility, and obligation to ensure that the work strictly complies with the Agreement terms and conditions and all applicable laws and building and safety codes. City’s inspection and testing shall not be deemed or considered acceptance by the City of any portion of the Construction Project. City’s inspection and testing shall not serve to nullify, amend, or waive any warranties provided by the Contractor under this Agreement. b. Contractor shall, without charge, replace any material or correct any work found by the City or its agents to be defective or otherwise not in compliance with the terms and conditions of this Agreement. In the event Contractor fails to replace or correct any defective work or materials after reasonable written notice by the City to do so, the City may take such corrective action, either with its own materials and employees or by retaining any third party to do so, and deduct the cost and expense of such corrective action from the Contractor’s compensation. 7. Partial Utilization of Construction Project: City shall have the right to use or occupy any portion of the Construction Project that City and Contractor mutually agree is substantially completed and constitutes a separately functioning and usable part of the Construction Project for its intended purpose without significant interference with Contractor’s performance of the remaining portions of the Construction Project. In the event City takes possession of any portion of the Construction Project, such possession shall not be deemed an acceptance of the Construction Project, in whole or in part. City’s use of any portion of the Construction Project shall not be grounds for extensions of any construction deadlines or a change in the Contractor’s compensation. Contractor’s warranties shall run from the completion of the total Construction Project and not from the date the City may take possession of selected portions of the Construction Project. 8. Related Work at the Site: Nothing in this Agreement shall prevent or preclude City, through its own employees or by contract with any third party, from performing other work related to the Construction Project at the construction site; provided such related work is not otherwise addressed in this Agreement and provided such related work does not otherwise interfere with Contractor’s performance of this Agreement or the completion of the Construction Project. Contractor shall afford any City employee, agent or representative, or any third party under contract with the City to perform the related work, proper and safe access to the construction site, a reasonable opportunity for the introduction and storage of materials and equipment, the opportunity to perform the related work, and shall properly coordinate the Contractor’s work on the Construction Project with the related work. 9. Contractor’s Warranties: Contractor represents and warrants as follows: a. Unless otherwise specified by the terms of this Agreement, all materials and equipment used by Contractor on the Construction Project shall be new and where not otherwise specified, of the most suitable grade for their intended uses. 42 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 4 of 16 b. All workmanship and materials shall be of a kind and nature acceptable to the City. c. All equipment, materials, and labor provided to, on, or for the Construction Project must be free of defects and nonconformities in design, materials, and workmanship for a minimum period beginning with the commencement of the work on the Construction Project and ending one (1) year from the final completion and acceptance by the City of the Construction Project, regardless of whether such equipment, materials, or labor were supplied directly by Contractor or indirectly by Contractor’s subcontractors or suppliers. Other express warranties on materials that provide for a warranty period longer than one year apply for the period of that express warranty and are not reduced by this provision. Upon receipt of City’s written notice of a defective or nonconforming condition during the warranty period, Contractor shall take all actions, including redesign and replacement, to correct the defective or nonconforming condition within a time frame acceptable to the City and at no additional cost to the City. Contractor shall also, at its sole cost, perform any tests required by City to verify that such defective or nonconforming condition has been corrected. Contractor warrants the corrective action taken against defective and nonconforming conditions for a period of an additional one (1) year from the date of City’s acceptance of the corrective action. d. Contractor and its sureties are liable for the satisfaction and full performance of all warranties. e. Contractor shall give its personal attention to the faithful prosecution of the completion of the Construction Project and Contractor, or its duly authorized representative assigned to serve as the Construction Project Manager, shall be personally present at the site of the Construction Project during working hours for the term of this Agreement until the completion of the Construction Project. f. Contractor shall have a complete, accurate, and up-to-date set of construction plans, drawings, and specifications on site at all times. g. Contractor has examined all available records and made field examinations of the site of the Construction Project. Contractor has knowledge of the field conditions to be encountered during the Construction Project. Contractor has knowledge of the types and character of equipment necessary for the work, the types of materials needed and the sources of such materials, and the condition of the local labor market. h. Contractor is responsible for the safety of the work and shall maintain all lights, guards, signs, temporary passages, or other protections necessary for that purpose at all times. i. All work must be performed at Contractor’s risk, and Contractor shall promptly repair or replace all damage and loss at its sole cost and expense regardless of the reason or cause of the damage or loss; provided, however, should the damage or loss be 43 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 5 of 16 caused by an intentional or negligent act of the City, the risk of such loss shall be placed on the City. j. Contractor is responsible for any loss or damage to materials, tools, or other articles used or held for use in the completion of performance of the Construction Project. k. Contractor’s performance must be without damage or disruption to any other work or property of the City or of others and without interference with the operation of existing machinery or equipment. l. Title to all work, materials, and equipment covered by any payment of Contractor’s compensation by City, whether directly incorporated into the Construction Project or not, passes to City at the time of payment, free and clear of all liens and encumbrances. 10. Delays and Extensions of Time: If Contractor’s performance of this Agreement is prevented or delayed by any unforeseen cause beyond the control of the Contractor, including acts or omissions of the City, Contractor shall, within ten (10) days of the commencement of any such delay, give the City written notice thereof. Further, Contractor shall, within ten (10) days of the termination of such delay, give the City written notice of the total actual duration of the delay. If the City is provided with these required notices and if the City determines that the cause of the delay was not foreseeable, was beyond the control of the Contractor, and was not a result of the fault or negligence of the Contractor, then the City will determine the total duration of the delay and extend the time for performance of the Agreement accordingly. Unless the delay is caused by the intentional interference of the City with the Contractor’s performance, Contractor shall make no claim for damages or any other claim other than for an extension of time as herein provided by reason of any delays. 11. Suspension: a. The City may, by written notice to the Contractor and at its convenience for any reason, suspend the performance of all or any portion of the work to be performed on the Construction Project (“Notice of Suspension”). The Notice of Suspension shall set forth the time of suspension, if then known to the City. During the period of suspension, Contractor shall use its best efforts to minimize costs associated with the suspension. b. Upon Contractor’s receipt of any Notice of Suspension, unless the notice requires otherwise, Contractor shall: (1) immediately discontinue work on the date and to the extent specified in the Notice of Suspension; (2) place no further orders or subcontracts for materials, services, or equipment; (3) promptly make every reasonable effort to obtain suspension upon terms satisfactory to City of all orders, subcontracts, and rental agreements to the extent that they relate to the performance of the work suspended; and (4) continue to protect and maintain the Project, including those portions on which work has been suspended. 44 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 6 of 16 c. As compensation for the suspended work, Contractor will be reimbursed for the following costs, reasonably incurred, without duplication of any item, and to the extent that such costs directly resulted from the suspension: (1) a standby charge paid during the period of suspension which will be sufficient to compensate Contractor for keeping, to the extent required in the Notice of Suspension, Contractor’s organization and equipment committed to the Project in standby status; (2) all reasonably incurred costs for the demobilization of Contractor’s and subcontractor’s crews and equipment; (3) an equitable amount to reimburse Contractor for the cost to protect and maintain the Project during the period of suspension; and (4) an equitable adjustment in the cost of performing the remaining portion of the work post-suspension if, as a direct result of the suspension, the cost to Contractor of subsequently performing the remaining work on the Construction Project has increased or decreased. d. Upon receipt of written notice by the City to resume the suspended work (“Notice to Resume Work”), Contractor shall immediately resume performance of the suspended work as to the extent required in the Notice to Resume Work. Any claim by Contractor for time or compensation described in Section 11(c) shall be made within fifteen (15) days after receipt of the Notice to Resume Work and Contractor shall submit a revised Construction Schedule for the City’s review and approval. Contractor’s failure to timely make such a claim shall result in a waiver of the claim. e. No compensation described in Section 11(c) shall be paid and no extension of time to complete the Construction Project shall be granted if the suspension results from Contractor’s non-compliance with or breach of the terms or requirements of this Agreement. 12. Termination for Contractor’s Fault: a. If Contractor refuses or fails to timely do the work, or any part thereof, or fails to perform any of its obligations under this Agreement, or otherwise breaches any terms or conditions of this Agreement, the City may, by written notice, terminate this Agreement and the Contractor’s right to proceed with all or any part of the Construction Project (“Termination Notice Due to Contractor’s Fault”). The City may then take over the Construction Project and complete it, either with its own resources or by re-letting the contract to any other third party, and may immediately take possession of and use such materials, appliances, tools, and equipment as may be on the site and which may be necessary for the completion of the Construction Project. b. In the event of a termination pursuant to this Section 12, Contractor shall be entitled to payment only for those services Contractor actually rendered. In the case of a lump sum or unit price contract, Contractor shall not be entitled to any further payment until the Construction Project has been completed. Upon completion of the Construction Project, if the unpaid balance of the Contractor’s compensation exceeds the cost to the City of completing the work, including all costs paid to any subcontractors or third parties retained by the City to complete the Construction Project and all administrative costs resulting from the termination (“City’s Cost for Completion”), such excess shall be paid to 45 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 7 of 16 the Contractor. If the City’s Cost for Completion exceeds the unpaid balance of the Contractor’s compensation, then Contractor and its sureties shall be liable for and shall pay the difference, plus interest at the rate applicable to court judgments, to the City. c. Any termination provided for by this Section 12 shall be in addition to any other remedies to which the City may be entitled under the law or at equity. d. In the event of termination under this Section 12, Contractor shall, under no circumstances, be entitled to claim or recover consequential, special, punitive, lost business opportunity, lost productivity, field office overhead, general conditions costs, or lost profits damages of any nature arising, or claimed to have arisen, as a result of the termination. 13. Termination for City’s Convenience: a. Should conditions arise which, in the sole opinion and discretion of the City, make it advisable to the City to cease work on the Construction Project, the City may terminate this Agreement by written notice to Contractor (“Notice of Termination for City’s Convenience”). The termination shall be effective in the manner specified in the Notice of Termination for City’s Convenience and shall be without prejudice to any claims that the City may otherwise have against Contractor. b. Upon receipt of the Notice of Termination for City’s Convenience, unless otherwise directed in the Notice, the Contractor shall immediately cease work on the Construction Project, discontinue placing orders for materials, supplies, and equipment for the Construction Project, and make every reasonable effort to cancel all existing orders or contracts upon terms satisfactory to the City. Contractor shall do only such work as may be necessary to preserve, protect, and maintain work already completed, in progress, or in transit to the construction site. c. In the event of a termination pursuant to this Section 13, Contractor is entitled to payment only for those services Contractor actually rendered and materials actually purchased or which Contractor has made obligations to purchase on or before the receipt of the Notice of Termination for City’s Convenience, and reasonably incurred costs for demobilization of Contractor’s and any subcontractor’s crews. It is agreed that any materials that City is obligated to purchase from Contractor will remain the City’s sole property. d. The compensation described in Section 13(c) is the sole compensation due to Contractor for its performance of this Agreement. Contractor shall, under no circumstances, be entitled to claim or recover consequential, special, punitive, lost business opportunity, lost productivity, field office overhead, general conditions costs, or lost profits damages of any nature arising, or claimed to have arisen, as a result of the termination. 46 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 8 of 16 14. Limitation on Contractor’s Damages; Time for Asserting Claim: a. In the event of a claim for damages by Contractor under this Agreement, Contractor’s damages shall be limited to contract damages and Contractor hereby expressly waives any right to claim or recover consequential, special, punitive, lost business opportunity, lost productivity, field office overhead, general conditions costs, or lost profits damages of any nature or kind. b. In the event Contractor wants to assert a claim for damages of any kind or nature, Contractor shall provide City with written notice of its claim, the facts and circumstances surrounding and giving rise to the claim, and the total amount of damages sought by the claim, within ten (10) days of the facts and circumstances giving rise to the claim. In the event Contractor fails to provide such notice, Contractor shall waive all rights to assert such claim. 15. Representatives and Notices: a. City’s Representative: The City’s Representative for the purpose of this Agreement shall be Max Ziegler, Facilities Project Coordinator, or such other individual as City shall designate in writing. Whenever approval or authorization from or communication or submission to City is required by this Agreement, such communication or submission shall be directed to the City’s Representative and approvals or authorizations shall be issued only by such Representative; provided, however, that in exigent circumstances when City’s Representative is not available, Contractor may direct its communication or submission to other designated City personnel or agents and may receive approvals or authorization from such persons. b. Contractor’s Representative: The Contractor’s Representative for the purpose of this Agreement shall be Gunnar Welsh, or such other individual as Contractor shall designate in writing. Whenever direction to or communication with Contractor is required by this Agreement, such direction or communication shall be directed to Contractor’s Representative; provided, however, that in exigent circumstances when Contractor’s Representative is not available, City may direct its direction or communication to other designated Contractor personnel or agents. c. Notices: All notices required by this Agreement shall be in writing and shall be provided to the Representatives named in this Section. Notices shall be deemed given when delivered, if delivered by courier to Party’s address shown above during normal business hours of the recipient; or when sent, if sent by email or fax (with a successful transmission report) to the email address or fax number provided by the Party’s Representative; or on the fifth business day following mailing, if mailed by ordinary mail to the address shown above, postage prepaid. 47 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 9 of 16 16. Locating Underground Facilities: Contractor shall be responsible for obtaining and determining the location of any underground facilities, including but not limited to, the location of any pipelines or utility supply, delivery, or service lines in accordance with the provisions of §69-4-501, et seq., Montana Code Annotated (MCA). Contractor shall make every effort to avoid damage to underground facilities and shall be solely responsible for any damage that may occur. If City personnel assume responsibility for locating any underground facilities, this fact shall be noted in writing prior to commencement of such location work. 17. Permits: Contractor shall provide all notices, comply with all applicable laws, ordinances, rules, and regulations, obtain all necessary permits, licenses, including a City of Bozeman business license, and inspections from applicable governmental authorities, pay all fees and charges in connection therewith, and perform all surveys and locations necessary for the timely completion of the Construction Project. 18. Ownership of Documents; Indemnification: All plans, designs, drawings, specifications, documents, sample results and data, in whatever medium or format, originated or prepared by or for Contractor in contemplation of, or in the course of, or as a result of this Agreement or work on the Construction Project, shall be promptly furnished to the City (“City Documents and Information”). All City Documents and Information shall be the exclusive property of the City and shall be deemed to be works-for-hire. Contractor hereby assigns all right, title, and interest in and to the City Documents and Information, including but not limited to, all copyright and patent rights in and to the City Documents and Information. Neither party grants to the other any express or implied licenses under any patents, copyrights, trademarks, or other intellectual property rights, except to the extent necessary to complete its obligations to the other under this Agreement. 19. Laws and Regulations: Contractor shall comply fully with all applicable state and federal laws, regulations, and municipal ordinances including, but not limited to, all workers’ compensation laws, all environmental laws including, but not limited to, the generation and disposal of hazardous waste, the Occupational Safety and Health Act (OSHA), the safety rules, codes, and provisions of the Montana Safety Act in Title 50, Chapter 71, MCA, all applicable City, County, and State building and electrical codes, the Americans with Disabilities Act, and all non- discrimination, affirmative action, and utilization of minority and small business statutes and regulations. 20. Nondiscrimination and Equal Pay: The Contractor agrees that all hiring by Contractor of persons performing this Agreement shall be on the basis of merit and qualifications. The Contractor will have a policy to provide equal employment opportunity in accordance with all applicable state and federal anti-discrimination laws, regulations, and contracts. The Contractor will not refuse employment to a person, bar a person from employment, or discriminate against a person in compensation or in a term, condition, or privilege of employment because of race, color, religion, creed, political ideas, sex, age, marital status, national origin, actual or perceived sexual orientation, gender identity, physical or mental disability, except when the reasonable demands of the position require an age, physical or mental disability, marital status or sex distinction. The 48 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 10 of 16 Contractor shall be subject to and comply with Title VI of the Civil Rights Act of 1964; Section 140, Title 2, United States Code, and all regulations promulgated thereunder. Contractor represents it is, and for the term of this Agreement will be, in compliance with the requirements of the Equal Pay Act of 1963 and Section 39-3-104, MCA (the Montana Equal Pay Act). Contractor must report to the City any violations of the Montana Equal Pay Act that Contractor has been found guilty of within 60 days of such finding for violations occurring during the term of this Agreement. Contractor shall require these nondiscrimination terms of its subcontractors providing services under this Agreement. 21. Intoxicants; DOT Drug and Alcohol Regulations: Contractor shall not permit or suffer the introduction or use of any intoxicants, including alcohol or illegal drugs, upon the site of the Construction Project. Contractor acknowledges it is aware of and shall comply with its responsibilities and obligations under the U.S. Department of Transportation (DOT) regulations governing anti-drug and alcohol misuse prevention plans and related testing. City shall have the right to request proof of such compliance and Contractor shall be obligated to furnish such proof. The Contractor shall be responsible for instructing and training the Contractor's employees and agents in proper and specified work methods and procedures. The Contractor shall provide continuous inspection and supervision of the work performed. The Contractor is responsible for instructing its employees and agents in safe work practices. 22. Labor Relations: a. In the event that, during the term of this Agreement and throughout the course of Contractor’s performance of the Construction Project, any labor problems or disputes of any type arise or materialize which in turn cause any work on the Construction Project to cease for any period of time, Contractor specifically agrees to take immediate steps, at its own expense and without expectation of reimbursement from City, to alleviate or resolve all such labor problems or disputes. The specific steps Contractor shall take to resume work on the Construction Project shall be left to the discretion of Contractor; provided, however, that Contractor shall bear all costs of any related legal action. Contractor shall provide immediate relief to the City so as to permit the work on the Construction Project to resume and be completed within the time frames set forth in the Construction Schedule at no additional cost to City. b. Contractor shall indemnify, defend, and hold the City harmless from any and all claims, demands, costs, expenses, damages, and liabilities arising out of, resulting from, or occurring in connection with any labor problems or disputes or any delays or stoppages of work associated with such problems or disputes. 49 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 11 of 16 23. Subcontractors: a. Contractor may employ subcontractors for any work on the Construction Project. Contractor shall provide City with a list of all subcontractors employed. b. Contractor remains fully responsible for the acts and omissions of any subcontractor, just as Contractor is for its own acts and omissions, and Contractor shall remain fully responsible and liable for the timely completion of the Construction Project. c. Contractor is solely liable for any and all payments to subcontractors. Contractor shall hold all payments received from the City in trust for the benefit of subcontractors, and all such payments shall be used to satisfy obligations of the Construction Project before being used for any other purpose. Contractor shall make any payments due to any subcontractor within seven (7) days of Contractor’s receipt of payment, including a proportional part of the retainage Contractor has received from the City. In the event of a dispute regarding any subcontractor’s invoice, Contractor shall promptly pay the undisputed amount to the subcontractor and notify the subcontractor in writing of the amount in dispute and the reasons for the dispute. Any withholding of payment must comply with the requirements of §28-2-2103, MCA. In the event Contractor is unwilling or unable to make timely and proper payment to any subcontractor, City may elect to withhold any payment otherwise due to Contractor and upon seven (7) days’ written notice to Contractor, may pay subcontractor by direct or joint payment. 24. Indebtedness and Liens: Before City may make any final payment to Contractor, Contractor shall furnish City with satisfactory proof that there are no outstanding debts or liens in connection with the Construction Project. If the Contractor allows any indebtedness to accrue to subcontractors or others during the progress of the work, and fails to pay or discharge the same within five (5) days after demand, then City may either withhold any money due to Contractor until such indebtedness is paid or apply the same towards the discharge of the indebtedness. If any lien or claim is filed or made by any subcontractor, material supplier, or any other person, the Contractor shall immediately notify the City and shall cause the same to be discharged of record within thirty (30) days after its filing. 25. Hazard Communication: Contractor shall comply with all hazard communication requirements dictated by the Environmental Protection Agency, the Montana Department of Agriculture, OSHA, Hazard Communications Standard, 29 CFR 1910.1200, and applicable City ordinances. Contractor shall supply a chemical list, the associated material safety data sheets (MSDS), and other pertinent health exposure data for chemicals that the Contractor’s, subcontractor’s or the City’s employees may be exposed to while working on City property during the course of the Construction Project. One copy of this documentation must be delivered to City to the attention of the City’s Representative. This documentation must be delivered before work involving these chemicals may commence. 26. Accounts and Records: During the term of this Agreement and for two (2) years following the City’s final acceptance of the Construction Project, Contractor shall maintain accounts and records related to the Construction Project. Upon reasonable notice, City shall have 50 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 12 of 16 the right to inspect all such accounts and records, including but not limited to, Contractor’s records, books, correspondence, instructions, drawings, specifications, field and site notes, receipts, invoices, bills, contracts, or other documents relating to the Construction Project. 27. Indemnification; Insurance; Bonds: a. Contractor agrees to release, defend, indemnify, and hold harmless the City, its agents, representatives, employees, and officers (collectively referred to for purposes of this Section as the City) from and against any and all claims, demands, actions, fees and costs (including attorney’s fees and the costs and fees of and expert witness and consultants), losses, expenses, liabilities (including liability where activity is inherently or intrinsically dangerous) or damages of whatever kind or nature connected therewith and without limit and without regard to the cause or causes thereof or the negligence of any party or parties that may be asserted against, recovered from or suffered by the City occasioned by, growing or arising out of or resulting from or in any way related to: (i) the negligent, reckless, or intentional misconduct of the Contractor; or (ii) any negligent, reckless, or intentional misconduct of any of the Contractor’s agents. b. Such obligations shall not be construed to negate, abridge, or reduce other rights or obligations of indemnity that would otherwise exist. The indemnification obligations of this Section must not be construed to negate, abridge, or reduce any common-law or statutory rights of the indemnitee(s) which would otherwise exist as to such indemnitee(s). c. Contractor’s indemnity under this Section shall be without regard to and without any right to contribution from any insurance maintained by City. d. Should the City be required to bring an action against the Contractor to assert its right to defense or indemnification under this Agreement or under the Contractor’s applicable insurance policies required below the City shall be entitled to recover reasonable costs and attorney fees incurred in asserting its right to indemnification or defense but only if a court of competent jurisdiction determines the Contractor was obligated to defend the claim(s) or was obligated to indemnify the City for a claim(s) or any portion(s) thereof. e. In the event of an action filed against the City resulting from the City’s performance under this Agreement, the City may elect to represent itself and incur all costs and expenses of suit. f. Contractor also waives any and all claims and recourse against the City, including the right of contribution for loss or damage to person or property arising from, growing out of, or in any way connected with or incident to the performance of this Agreement except “responsibility for [City’s] own fraud, for willful injury to the person or property of another, or for violation of law, whether willful or negligent” as per 28-2-702, MCA. 51 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 13 of 16 g. These obligations shall survive termination of this Agreement and the services performed hereunder. h. In addition to and independent from the above, Contractor shall at Contractor’s expense secure insurance coverage through an insurance company or companies duly licensed and authorized to conduct insurance business in Montana which insures the liabilities and obligations specifically assumed by the Contractor in this Section. The insurance coverage shall not contain any exclusion for liabilities specifically assumed by the Contractor in subsection (a) of this Section. The insurance shall cover and apply to all claims, demands, suits, damages, losses, and expenses that may be asserted or claimed against, recovered from, or suffered by the City without limit and without regard to the cause therefore and which is acceptable to the City. Contractor shall furnish to the City an accompanying certificate of insurance and accompanying endorsements in amounts not less than as shown below:  Workers’ Compensation – not less than statutory limits;  Employers’ Liability - $1,000,000 per occurrence; $2,000,000 annual aggregate;  Commercial General Liability - $1,000,000 per occurrence; $2,000,000 annual aggregate;  Products and Completed Operations – $1,000,000;  Automobile Liability - $1,000,000 property damage/bodily injury; $2,000,000 annual aggregate (all owned, hired, non-owned vehicles);  Builder’s Risk/Property Insurance at least as broad as that provided by the ISO special causes of loss form (CP10 30) naming at a minimum the City in an amount equal to greater of Contractor’s compensation or full replacement value of the work (covering at a minimum all work, buildings, materials and equipment, whether on site or in transit, loss due to fire, lightening, theft, vandalism, malicious mischief, earthquake, collapse, debris removal, demolition occasioned by enforcement of laws, water damage, flood if site within a flood plain, repair or replacement costs, testing and start-up costs) on an all risk coverage basis. This insurance must include waivers of subrogation between the City and Contractor to the extent that damage to the Construction Project or City Hall is covered by other insurance;  Owner’s and Contractor’s Protective Liability: one policy designating the City (including its agents, representatives, employees, and officers) as the insured and another independent policy designated the City’s Representative (including its consultants, consultants, agents and employees) as the insured on the declarations with both policies covering: (i) operations performed by the Contractor under this Agreement for the City; and (ii) the City’s and City’s Representatives acts or omissions, including negligent acts, in connection with its general supervision of the work of the Contractor’s and its subcontractors - $1,000,000 per occurrence; $2,000,000 aggregate;  Contractual Liability Insurance (covering the Contractor’s indemnity obligations described in this Agreement) - $1,000,000 per occurrence $2,000,000 aggregate 52 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 14 of 16 The amounts of insurance provided shall be exclusive of defense costs. The City of Bozeman shall be endorsed as an additional or named insured on a primary non- contributory basis on both the Commercial General and Automobile Liability policies. The insurance and required endorsements must be in a form suitable to City and shall include no less than a thirty (30) day notice of cancellation or non-renewal. Contractor shall notify City within two (2) business days of Contractor’s receipt of notice that any required insurance coverage will be terminated or Contractor’s decision to terminate any required insurance coverage for any reason. The City must approve all insurance coverage and endorsements prior to the Contractor commencing work. i. Pursuant to the City’s authority provided for in 18-2-201(4), the Contractor shall not be required to provide bonds as required by 18-2-201(1) under this Agreement. 28. Taxes: Contractor is obligated to pay all taxes of any kind or nature and make all appropriate employee withholdings. Contractor understands that all contractors or subcontractors working on a publicly funded project are required to pay or have withheld from earnings a license fee of one percent (1%) of the gross contract price if the gross contract price is Five Thousand Dollars ($5,000) or more. This license fee is paid to the Montana Department of Revenue. 29. Dispute Resolution: a. Any claim, controversy, or dispute between the parties, their agents, employees, or representatives shall be resolved first by negotiation between senior-level personnel from each party duly authorized to execute settlement agreements. Upon mutual agreement of the parties, the parties may invite an independent, disinterested mediator to assist in the negotiated settlement discussions. b. If the parties are unable to resolve the dispute within thirty (30) days from the date the dispute was first raised, then such dispute shall be resolved in a court of competent jurisdiction in compliance with the Applicable Law provisions of this Agreement. 30. Survival: Contractor’s indemnification and warranty obligations shall survive the termination or expiration of this Agreement for the maximum period allowed under applicable law. 31. Headings: The headings used in this Agreement are for convenience only and are not be construed as a part of the Agreement or as a limitation on the scope of the particular paragraphs to which they refer. 32. Waiver: A waiver by City of any default or breach by Contractor of any covenants, terms, or conditions of this Agreement does not limit City’s right to enforce such covenants, terms, or conditions or to pursue City’s rights in the event of any subsequent default or breach. 53 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 15 of 16 33. Attorney’s Fees and Costs: In the event it becomes necessary for either Party to retain an attorney to enforce any of the terms or conditions of this Agreement or to give any notice required herein, then the prevailing Party or the Party giving notice shall be entitled to reasonable attorney's fees and costs, including fees, salary, and costs of in-house counsel including the City Attorney’s Office staff. 34. Severability: If any portion of this Agreement is held to be void or unenforceable, the balance thereof shall continue in effect. 35. Applicable Law: The parties agree that this Agreement is governed in all respects by the laws of the State of Montana. 36. Binding Effect: This Agreement is binding upon and inures to the benefit of the heirs, legal representatives, successors, and assigns of the parties. 37. Amendments: This Agreement may not be modified, amended, or changed in any respect except by a written document signed by all parties. 38. No Third-Party Beneficiary: This Agreement is for the exclusive benefit of the parties, does not constitute a third-party beneficiary agreement, and may not be relied upon or enforced by a third party. 38. Counterparts: This Agreement may be executed in counterparts, which together constitute one instrument. 39. Assignment: Contractor may not assign this Agreement in whole or in part without the prior written consent of the City. No assignment will relieve Contractor of its responsibility for the performance of the Agreement and the completion of the Construction Project. Contractor may not assign to any third party other than Contractor’s subcontractors on the Construction Project, the right to receive monies due from City without the prior written consent of City. 40. Authority: Each party represents that it has full power and authority to enter into and perform this Agreement and the person signing this Agreement on behalf of each party has been properly authorized and empowered to sign this Agreement. 41. Independent Contractor: The parties agree and acknowledge that in the performance of this Agreement and the completion of the Construction Project, Contractor shall render services as an independent contractor and not as the agent, representative, subcontractor, or employee of the City. The parties further agree that all individuals and companies retained by Contractor at all times will be considered the agents, employees, or independent contractors of Contractor and at no time will they be the employees, agents, or representatives of the City. 42. Integration: This Agreement and all Exhibits attached hereto constitute the entire agreement of the parties. Covenants or representations not contained therein or made a part thereof by reference, are not binding upon the parties. There are no understandings between the parties 54 Construction Agreement for Story Mansion Exterior Painting FY2020-2021 Page 16 of 16 other than as set forth in this Agreement. All communications, either verbal or written, made prior to the date of this Agreement are hereby abrogated and withdrawn unless specifically made a part of this Agreement by reference. 43. Consent to Electronic Signatures: The Parties have consented to execute this Agreement electronically in conformance with the Montana Uniform Electronic Transactions Act, Title 30, Chapter 18, Part 1, MCA. **** END OF AGREEMENT EXCEPT FOR SIGNATURES **** IN WITNESS WHEREOF, Contractor and City have caused this Agreement to be executed, effective on the date written above, and intend to be legally bound thereby. CITY OF BOZEMAN, MONTANA CONTRACTOR By: _______________________________ By: Jeff Mihelich, City Manager Print Name: Title: APPROVED AS TO FORM: By: _______________________________ Greg Sullivan, City Attorney 55 EXHIBIT A 56 57 Revised 9/2/11 1 EXHIBIT G Scope of Work & Drawings, Plans and Specifications The Drawings, Plans and Specifications provided by the City or its architect or engineer as described below: This project is to include repainting the exterior finished surfaces of the Story Mansion. The Carriage House which is also on the property is not to be included in this project. The Story Mansion, built in 1910, is a contributing structure to the Bon Ton Historic District listed in the National Register of Historic Places. Work done on exterior wood surfaces shall follow the best practices recommended by the Secretary of the Interior’s Standards for Rehabilitation. In summary, these sources state: 1. Removing paint from historic buildings—except for cleaning, light scraping of loose layers, and light hand sanding to feather between layers of old paint or between old paint and exposed wood should be avoided unless absolutely essential. 2. If conditions warranting old paint removal are identified the approach should be to remove paint to the next sound layer using the gentlest means possible, then to repaint. 3. Power tools, heat tools, highly abrasive chemicals are inconsistent with best practices for historic preservation and must be specifically approved prior to use on this project. 4. Paint and wood conditions vary at different points on the building requiring a careful inspection before work commences. Each compass face of painted exterior woodwork (conditions vary based on sun and weather exposure) should be examined early in the planning phase and surface conditions noted. 5. If repair of rotted wood is impossible, replacement pieces should be in accordance with best practices for Historic Preservation. Damaged or rotted wood should be replaced “in kind” with rot-resistant wood. Preparation of Painted Surfaces 1. Wash all exterior wood and metal surfaces with TSP or other appropriate cleaning compound prior to scraping, sanding, or priming. If pressure washers are to be used, contractor is responsible for ensuring that their use does not result in damage to any surfaces. 2. Repairs to degraded exterior wood surfaces will be made by the City prior to the start of the painting project, however it is foreseeable that painters will encounter pieces of trim or siding that are poorly secured. It is expected that the painting contractor will re-secure any loose wood encountered with nails, screws or glue as needed for the proper application of paint. 3. If substantial damage to siding or trim is found while preparing for painting, requiring fabrication and replacement, the contractor is to inform the City promptly so that it may be addressed without delaying the project. 4. On all wood and metal surfaces, remove all peeling, scaling and old failing paint layers and caulking. 5. “Feather” sand all remaining paint surfaces to minimize edges of existing painting layers and create a smooth surface transition. 6. Remove old caulking in joints between wood and masonry or metal. Clean substrates prior to application of new caulking. 58 Revised 9/2/11 2 7. Fill any nail or other holes, cracks, joints or other penetrations on exterior surfaces. Achieve a “caulk to finish” surface in wood to masonry joints. 8. Use rust-resistant nails/screws when refastening existing loose wood or installing replacement wood items. 9. Any metal surface is to be prepared and painted within the same day 10. Bare wood surfaces should not be left exposed longer than 96 hours before receiving a prime coat. Any bare wood surfaces exposed longer than 96 hours will need to be lightly re-sanded to remove any decomposed wood fiber from UV radiation. 11. Use appropriate measures to contain and collect all paint and caulking debris and appropriately dispose of such debris at the end of each workday. Any debris containing lead paint shall be appropriately controlled and managed by the painting contractor. Application 1. Prime all bare wood and paint all exterior surfaces to include, but not limited to, siding, fascia, shadow and trim boards, eaves, door frames and trim, window frames and trim, railings, steps, ramps, shutters, etc. 2. Primer shall be a minimum of one (1) coat on all bare wood 3. Topcoats shall be applied with a minimum of two (2) coats. 4. Follow manufacturers recommended procedures for producing best results, including testing of substrates, moisture in substrates, and humidity and temperature limitations. 5. Do not apply materials when surface and ambient temperatures are outside the temperature ranges required by the paint product manufacturer. 6. Do not apply exterior coatings during rain or snow, or when relative humidity is outside the humidity ranges required by the paint product manufacturer. 7. Each coat of paint must be uniform in color, gloss, thickness, and texture and free of runs, sags, blisters, or other discontinuities. 8. If paint is applied with a sprayer, paint shall be back-brushed to ensure uniform coverage and penetration, and to leave a brushed finish. Materials 1. Paint used on this project shall be Sherwin Williams products as follows: a. Body i. Spot Prime: B51T00600 – Prime Rx Peel Bonding Primer Clear ii. 2 Coats: K32W00251 – Duration Exterior Latex Flat b. Trim i. Spot Prime: B51T00600 – Prime Rx Peel Bonding Primer Clear ii. 2 Coats: K30W00251 – Duration Exterior Latex Low Luster 2. Color codes will be provided by the City prior to start of project. General Provisions 1. All materials, equipment, supplies and labor required for this project will be supplied by the contractor. 2. Contractor shall use ladders, scaffolding or lift devices in a reasonable and prudent manner that will not damage the roof or other components of the structure. 3. All existing landscaping will be covered/protected during the project. If any landscaping is significantly damaged during the project, the contractor will be responsible for repairing or 59 Revised 9/2/11 3 replacing the landscaping. The contractor should include an explicit plan in their bid addressing this requirement. 4. There is likely lead paint present given the age of the building. While extensive abatement is not required for this project, the selected contractor will be responsible for managing the disturbance and disposal of lead containing paint debris in accordance with applicable regulations. 5. Operating equipment or performing any construction or repair work will be authorized between the hours defined in The City of Bozeman Code of Ordinances Section 16.06.070. 60 Memorandum REPORT TO:City Commission FROM:Max Ziegler, Facilities Project Coordinator Mike Gray, Facilities Superintendent Jon Henderson, Strategic Services Director SUBJECT:Authorize City Manager to Sign a Professional Services Agreement with Ingram-Clevenger Inc for Story Mansion Exterior Repairs MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Agreement - Vendor/Contract RECOMMENDATION:Authorize City Manager to sign professional services agreement with Ingram- Clevenger Inc for Story Mansion exterior repairs. STRATEGIC PLAN:4.3 Strategic Infrastructure Choices: Prioritize long-term investment and maintenance for existing and new infrastructure. BACKGROUND:Story Mansion, purchased by the City of Bozeman in 2003, was last painted in 2007. The building is scheduled to be painted this summer, and a bid has been received to complete the painting work. Before the painting work may begin, there are a number of minor repairs which must be completed to address deterioration of exterior siding and trim. Repair work will include securing loose trim, replacing missing or damaged siding, replacing rotten wood, and repairing gutters. Ingram-Clevenger was selected for this project after soliciting bids from the Facilities Dept.'s list of qualified contractors who all declined to submit a bid due to limited availability. This repair work will ensure that the new exterior paint is installed on sound substrate and will extend the service life of the paint job. UNRESOLVED ISSUES:None. ALTERNATIVES:As suggested by City Commission FISCAL EFFECTS:The expense for this project will be a fixed fee of $9,800 to be funded by the Recreation Depts. operating budget for Story Mansion. Attachments: Professional Services Agreement - Ingram-Clevenger - Story Mansion Exterior Repairs.pdf Report compiled on: May 27, 2022 61 Version 8 30 21 Professional Services Agreement for Story Mansion Exterior Repairs Page 1 of 11 PROFESSIONAL SERVICES AGREEMENT THIS AGREEMENT is made and entered into this _____ day of ____________, 202__ (“Effective Date”), by and between the CITY OF BOZEMAN, MONTANA, a self-governing municipal corporation organized and existing under its Charter and the laws of the State of Montana, 121 North Rouse Street, Bozeman, Montana, with a mailing address of PO Box 1230, Bozeman, MT 59771, hereinafter referred to as “City,” and, Ingram-Clevenger Inc, PO Box 5387, Helena, MT 59604, hereinafter referred to as “Contractor.” The City and Contractor may be referred to individually as “Party” and collectively as “Parties.” In consideration of the mutual covenants and agreements herein contained, the receipt and sufficiency whereof being hereby acknowledged, the parties hereto agree as follows: 1. Purpose: City agrees to enter this Agreement with Contractor to perform for City services described in the Scope of Services attached hereto as Exhibit A and by this reference made a part hereof. 2. Term/Effective Date: This Agreement is effective upon the Effective Date and will expire on the 30th day of December, 2022, unless earlier terminated in accordance with this Agreement. 3. Scope of Services: Contractor will perform the work and provide the services in accordance with the requirements of the Scope of Services. For conflicts between this Agreement and the Scope of Services, unless specifically provided otherwise, the Agreement governs. 4. Payment: City agrees to pay Contractor the amount specified in the Scope of Services. Any alteration or deviation from the described services that involves additional costs above the Agreement amount will be performed by Contractor after written request by the City, and will become an additional charge over and above the amount listed in the Scope of Services. The City must agree in writing upon any additional charges. 5. Contractor’s Representations: To induce City to enter into this Agreement, 62 Version 8 30 21 Professional Services Agreement for Story Mansion Exterior Repairs Page 2 of 11 Contractor makes the following representations: a. Contractor has familiarized itself with the nature and extent of this Agreement, the Scope of Services, and with all local conditions and federal, state and local laws, ordinances, rules, and regulations that in any manner may affect cost, progress or performance of the Scope of Services. b. Contractor represents and warrants to City that it has the experience and ability to perform the services required by this Agreement; that it will perform the services in a professional, competent and timely manner and with diligence and skill; that it has the power to enter into and perform this Agreement and grant the rights granted in it; and that its performance of this Agreement shall not infringe upon or violate the rights of any third party, whether rights of copyright, trademark, privacy, publicity, libel, slander or any other rights of any nature whatsoever, or violate any federal, state and municipal laws. The City will not determine or exercise control as to general procedures or formats necessary to have these services meet this warranty. 6. Independent Contractor Status/Labor Relations: The parties agree that Contractor is an independent contractor for purposes of this Agreement and is not to be considered an employee of the City for any purpose. Contractor is not subject to the terms and provisions of the City’s personnel policies handbook and may not be considered a City employee for workers’ compensation or any other purpose. Contractor is not authorized to represent the City or otherwise bind the City in any dealings between Contractor and any third parties. Contractor shall comply with the applicable requirements of the Workers’ Compensation Act, Title 39, Chapter 71, Montana Code Annotated (MCA), and the Occupational Disease Act of Montana, Title 39, Chapter 71, MCA. Contractor shall maintain workers’ compensation coverage for all members and employees of Contractor’s business, except for those members who are exempted by law. Contractor shall furnish the City with copies showing one of the following: (1) a binder for workers’ compensation coverage by an insurer licensed and authorized to provide workers’ compensation insurance in the State of Montana; or (2) proof of exemption from workers’ compensation granted by law for independent contractors. In the event that, during the term of this Agreement, any labor problems or disputes of any type arise or materialize which in turn cause any services to cease for any period of time, Contractor specifically agrees to take immediate steps, at its own expense and without expectation of reimbursement from City, to alleviate or resolve all such labor problems or disputes. The specific steps Contractor shall take shall be left to the discretion of Contractor; provided, however, that 63 Version 8 30 21 Professional Services Agreement for Story Mansion Exterior Repairs Page 3 of 11 Contractor shall bear all costs of any related legal action. Contractor shall provide immediate relief to the City so as to permit the services to continue at no additional cost to City. Contractor shall indemnify, defend, and hold the City harmless from any and all claims, demands, costs, expenses, damages, and liabilities arising out of, resulting from, or occurring in connection with any labor problems or disputes or any delays or stoppages of work associated with such problems or disputes. 7. Indemnity/Waiver of Claims/Insurance: For other than professional services rendered, to the fullest extent permitted by law, Contractor agrees to release, defend, indemnify, and hold harmless the City, its agents, representatives, employees, and officers (collectively referred to for purposes of this Section as the City) from and against any and all claims, demands, actions, fees and costs (including attorney’s fees and the costs and fees of expert witness and consultants), losses, expenses, liabilities (including liability where activity is inherently or intrinsically dangerous) or damages of whatever kind or nature connected therewith and without limit and without regard to the cause or causes thereof or the negligence of any party or parties that may be asserted against, recovered from or suffered by the City occasioned by, growing or arising out of or resulting from or in any way related to: (i) the negligent, reckless, or intentional misconduct of the Contractor; or (ii) any negligent, reckless, or intentional misconduct of any of the Contractor’s agents. For the professional services rendered, to the fullest extent permitted by law, Contractor agrees to indemnify and hold the City harmless against claims, demands, suits, damages, losses, and expenses, including reasonable defense attorney fees, to the extent caused by the negligence or intentional misconduct of the Contractor or Contractor’s agents or employees. Such obligations shall not be construed to negate, abridge, or reduce other rights or obligations of indemnity that would otherwise exist. The indemnification obligations of this Section must not be construed to negate, abridge, or reduce any common-law or statutory rights of the City as indemnitee(s) which would otherwise exist as to such indemnitee(s). Contractor’s indemnity under this Section shall be without regard to and without any right to contribution from any insurance maintained by City. Should the City be required to bring an action against the Contractor to assert its right to defense or indemnification under this Agreement or under the Contractor’s applicable insurance policies required below, the City shall be entitled to recover reasonable costs and attorney fees incurred in asserting its right to indemnification or defense but only if a court of competent 64 Version 8 30 21 Professional Services Agreement for Story Mansion Exterior Repairs Page 4 of 11 jurisdiction determines the Contractor was obligated to defend the claim(s) or was obligated to indemnify the City for a claim(s) or any portion(s) thereof. In the event of an action filed against the City resulting from the City’s performance under this Agreement, the City may elect to represent itself and incur all costs and expenses of suit. Contractor also waives any and all claims and recourse against the City, including the right of contribution for loss or damage to person or property arising from, growing out of, or in any way connected with or incident to the performance of this Agreement except “responsibility for [City’s] own fraud, for willful injury to the person or property of another, or for violation of law, whether willful or negligent” as per 28-2-702, MCA. These obligations shall survive termination of this Agreement and the services performed hereunder. In addition to and independent from the above, Contractor shall at Contractor’s expense secure insurance coverage through an insurance company or companies duly licensed and authorized to conduct insurance business in Montana which insures the liabilities and obligations specifically assumed by the Contractor in this Section. The insurance coverage shall not contain any exclusion for liabilities specifically assumed by the Contractor in this Section. The insurance shall cover and apply to all claims, demands, suits, damages, losses, and expenses that may be asserted or claimed against, recovered from, or suffered by the City without limit and without regard to the cause therefore and which is acceptable to the City. Contractor shall furnish to the City an accompanying certificate of insurance and accompanying endorsements in amounts not less than as follows:  Workers’ Compensation – statutory;  Employers’ Liability - $1,000,000 per occurrence; $2,000,000 annual aggregate;  Commercial General Liability - $1,000,000 per occurrence; $2,000,000 annual aggregate;  Automobile Liability - $1,000,000 property damage/bodily injury per accident; and  Professional Liability - $1,000,000 per claim; $2,000,000 annual aggregate. The above amounts shall be exclusive of defense costs. The City shall be endorsed as an additional or named insured on a primary non-contributory basis on the Commercial General, Employer’s Liability, and Automobile Liability policies. The insurance and required endorsements 65 Version 8 30 21 Professional Services Agreement for Story Mansion Exterior Repairs Page 5 of 11 must be in a form suitable to City and shall include no less than a thirty (30) day notice of cancellation or non-renewal. Contractor shall notify City within two (2) business days of Contractor’s receipt of notice that any required insurance coverage will be terminated or Contractor’s decision to terminate any required insurance coverage for any reason. The City must approve all insurance coverage and endorsements prior to the Contractor commencing work. 8. Termination for Contractor’s Fault: a. If Contractor refuses or fails to timely do the work, or any part thereof, or fails to perform any of its obligations under this Agreement, or otherwise breaches any terms or conditions of this Agreement, the City may, by written notice, terminate this Agreement and the Contractor’s right to proceed with all or any part of the work (“Termination Notice Due to Contractor’s Fault”). The City may then take over the work and complete it, either with its own resources or by re-letting the contract to any other third party. b. In the event of a termination pursuant to this Section 8, Contractor shall be entitled to payment only for those services Contractor actually rendered. c. Any termination provided for by this Section 8 shall be in addition to any other remedies to which the City may be entitled under the law or at equity. d. In the event of termination under this Section 8, Contractor shall, under no circumstances, be entitled to claim or recover consequential, special, punitive, lost business opportunity, lost productivity, field office overhead, general conditions costs, or lost profits damages of any nature arising, or claimed to have arisen, as a result of the termination. 9. Termination for City’s Convenience: a. Should conditions arise which, in the sole opinion and discretion of the City, make it advisable to the City to cease performance under this Agreement, the City may terminate this Agreement by written notice to Contractor (“Notice of Termination for City’s Convenience”). The termination shall be effective in the manner specified in the Notice of Termination for City’s Convenience and shall be without prejudice to any claims that the City may otherwise have against Contractor. 66 Version 8 30 21 Professional Services Agreement for Story Mansion Exterior Repairs Page 6 of 11 b. Upon receipt of the Notice of Termination for City’s Convenience, unless otherwise directed in the Notice, the Contractor shall immediately cease performance under this Agreement and make every reasonable effort to refrain from continuing work, incurring additional expenses or costs under this Agreement and shall immediately cancel all existing orders or contracts upon terms satisfactory to the City. Contractor shall do only such work as may be necessary to preserve, protect, and maintain work already completed or immediately in progress. c. In the event of a termination pursuant to this Section 9, Contractor is entitled to payment only for those services Contractor actually rendered on or before the receipt of the Notice of Termination for City’s Convenience. d. The compensation described in Section 9(c) is the sole compensation due to Contractor for its performance of this Agreement. Contractor shall, under no circumstances, be entitled to claim or recover consequential, special, punitive, lost business opportunity, lost productivity, field office overhead, general conditions costs, or lost profits damages of any nature arising, or claimed to have arisen, as a result of the termination. 10. Limitation on Contractor’s Damages; Time for Asserting Claim: a. In the event of a claim for damages by Contractor under this Agreement, Contractor’s damages shall be limited to contract damages and Contractor hereby expressly waives any right to claim or recover consequential, special, punitive, lost business opportunity, lost productivity, field office overhead, general conditions costs, or lost profits damages of any nature or kind. b. In the event Contractor wants to assert a claim for damages of any kind or nature, Contractor shall provide City with written notice of its claim, the facts and circumstances surrounding and giving rise to the claim, and the total amount of damages sought by the claim, within thirty (30) days of the facts and circumstances giving rise to the claim. In the event Contractor fails to provide such notice, Contractor shall waive all rights to assert such claim. 11. Representatives and Notices: a. City’s Representative: The City’s Representative for the purpose of this Agreement shall be Max Ziegler, Facilities Project Coordinator, or such other individual as 67 Version 8 30 21 Professional Services Agreement for Story Mansion Exterior Repairs Page 7 of 11 City shall designate in writing. Whenever approval or authorization from or communication or submission to City is required by this Agreement, such communication or submission shall be directed to the City’s Representative and approvals or authorizations shall be issued only by such Representative; provided, however, that in exigent circumstances when City’s Representative is not available, Contractor may direct its communication or submission to other designated City personnel or agents as designated by the City in writing and may receive approvals or authorization from such persons. b. Contractor’s Representative: The Contractor’s Representative for the purpose of this Agreement shall be Randy Berndt or such other individual as Contractor shall designate in writing. Whenever direction to or communication with Contractor is required by this Agreement, such direction or communication shall be directed to Contractor’s Representative; provided, however, that in exigent circumstances when Contractor’s Representative is not available, City may direct its direction or communication to other designated Contractor personnel or agents. c. Notices: All notices required by this Agreement shall be in writing and shall be provided to the Representatives named in this Section. Notices shall be deemed given when delivered, if delivered by courier to Party’s address shown above during normal business hours of the recipient; or when sent, if sent by email or fax (with a successful transmission report) to the email address or fax number provided by the Party’s Representative; or on the fifth business day following mailing, if mailed by ordinary mail to the address shown above, postage prepaid. 12. Permits: Contractor shall provide all notices, comply with all applicable laws, ordinances, rules, and regulations, obtain all necessary permits, licenses, including a City of Bozeman business license, and inspections from applicable governmental authorities, and pay all fees and charges in connection therewith. 13 Laws and Regulations: Contractor shall comply fully with all applicable state and federal laws, regulations, and municipal ordinances including, but not limited to, all workers’ compensation laws, all environmental laws including, but not limited to, the generation and disposal of hazardous waste, the Occupational Safety and Health Act (OSHA), the safety rules, codes, and provisions of the Montana Safety Act in Title 50, Chapter 71, MCA, all applicable City, County, and State building and electrical codes, the Americans with Disabilities Act, and all non-discrimination, affirmative action, and utilization of minority and small business statutes and regulations. 68 Version 8 30 21 Professional Services Agreement for Story Mansion Exterior Repairs Page 8 of 11 14. Nondiscrimination and Equal Pay: The Contractor agrees that all hiring by Contractor of persons performing this Agreement shall be on the basis of merit and qualifications. The Contractor will have a policy to provide equal employment opportunity in accordance with all applicable state and federal anti-discrimination laws, regulations, and contracts. The Contractor will not refuse employment to a person, bar a person from employment, or discriminate against a person in compensation or in a term, condition, or privilege of employment because of race, color, religion, creed, political ideas, sex, age, marital status, national origin, actual or perceived sexual orientation, gender identity, physical or mental disability, except when the reasonable demands of the position require an age, physical or mental disability, marital status or sex distinction. The Contractor shall be subject to and comply with Title VI of the Civil Rights Act of 1964; Section 140, Title 2, United States Code, and all regulations promulgated thereunder. Contractor represents it is, and for the term of this Agreement will be, in compliance with the requirements of the Equal Pay Act of 1963 and Section 39-3-104, MCA (the Montana Equal Pay Act). Contractor must report to the City any violations of the Montana Equal Pay Act that Contractor has been found guilty of within 60 days of such finding for violations occurring during the term of this Agreement. Contractor shall require these nondiscrimination terms of its subcontractors providing services under this Agreement. 15. Intoxicants; DOT Drug and Alcohol Regulations/Safety and Training: Contractor shall not permit or suffer the introduction or use of any intoxicants, including alcohol or illegal drugs, by any employee or agent engaged in services to the City under this Agreement while on City property or in the performance of any activities under this Agreement. Contractor acknowledges it is aware of and shall comply with its responsibilities and obligations under the U.S. Department of Transportation (DOT) regulations governing anti-drug and alcohol misuse prevention plans and related testing. City shall have the right to request proof of such compliance and Contractor shall be obligated to furnish such proof. The Contractor shall be responsible for instructing and training the Contractor's employees and agents in proper and specified work methods and procedures. The Contractor shall provide continuous inspection and supervision of the work performed. The Contractor is responsible for instructing its employees and agents in safe work practices. 16. Modification and Assignability: This Agreement may not be enlarged, modified or altered except by written agreement signed by both parties hereto. The Contractor may not 69 Version 8 30 21 Professional Services Agreement for Story Mansion Exterior Repairs Page 9 of 11 subcontract or assign Contractor’s rights, including the right to compensation or duties arising hereunder, without the prior written consent of the City. Any subcontractor or assignee will be bound by all of the terms and conditions of this Agreement. 17. Reports/Accountability/Public Information: Contractor agrees to develop and/or provide documentation as requested by the City demonstrating Contractor’s compliance with the requirements of this Agreement. Contractor shall allow the City, its auditors, and other persons authorized by the City to inspect and copy its books and records for the purpose of verifying that the reimbursement of monies distributed to Contractor pursuant to this Agreement was used in compliance with this Agreement and all applicable provisions of federal, state, and local law. The Contractor shall not issue any statements, releases or information for public dissemination without prior approval of the City. 18. Non-Waiver: A waiver by either party of any default or breach by the other party of any terms or conditions of this Agreement does not limit the other party’s right to enforce such term or conditions or to pursue any available legal or equitable rights in the event of any subsequent default or breach. 19. Attorney’s Fees and Costs: In the event it becomes necessary for either Party to retain an attorney to enforce any of the terms or conditions of this Agreement or to give any notice required herein, then the prevailing Party or the Party giving notice shall be entitled to reasonable attorney's fees and costs, including fees, salary, and costs of in-house counsel including the City Attorney’s Office staff. 20. Taxes: Contractor is obligated to pay all taxes of any kind or nature and make all appropriate employee withholdings. 21. Dispute Resolution: a. Any claim, controversy, or dispute between the parties, their agents, employees, or representatives shall be resolved first by negotiation between senior-level personnel from each party duly authorized to execute settlement agreements. Upon mutual agreement of the parties, the parties may invite an independent, disinterested mediator to assist in the negotiated settlement discussions. b. If the parties are unable to resolve the dispute within thirty (30) days from the date the dispute was first raised, then such dispute may only be resolved in a court of 70 Version 8 30 21 Professional Services Agreement for Story Mansion Exterior Repairs Page 10 of 11 competent jurisdiction in compliance with the Applicable Law provisions of this Agreement. 22. Survival: Contractor’s indemnification shall survive the termination or expiration of this Agreement for the maximum period allowed under applicable law. 23. Headings: The headings used in this Agreement are for convenience only and are not be construed as a part of the Agreement or as a limitation on the scope of the particular paragraphs to which they refer. 24. Severability: If any portion of this Agreement is held to be void or unenforceable, the balance thereof shall continue in effect. 25. Applicable Law: The parties agree that this Agreement is governed in all respects by the laws of the State of Montana. 26. Binding Effect: This Agreement is binding upon and inures to the benefit of the heirs, legal representatives, successors, and assigns of the parties. 27. No Third-Party Beneficiary: This Agreement is for the exclusive benefit of the parties, does not constitute a third-party beneficiary agreement, and may not be relied upon or enforced by a third party. 28. Counterparts: This Agreement may be executed in counterparts, which together constitute one instrument. 29. Integration: This Agreement and all Exhibits attached hereto constitute the entire agreement of the parties. Covenants or representations not contained herein or made a part thereof by reference, are not binding upon the parties. There are no understandings between the parties other than as set forth in this Agreement. All communications, either verbal or written, made prior to the date of this Agreement are hereby abrogated and withdrawn unless specifically made a part of this Agreement by reference. 30. Consent to Electronic Signatures: The Parties have consented to execute this Agreement electronically in conformance with the Montana Uniform Electronic Transactions Act, Title 30, Chapter 18, Part 1, MCA. **** END OF AGREEMENT EXCEPT FOR SIGNATURES **** 71 Version 8 30 21 Professional Services Agreement for Story Mansion Exterior Repairs Page 11 of 11 IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and year first above written or as recorded in an electronic signature. CITY OF BOZEMAN, MONTANA ____________________________________ CONTRACTOR (Type Name Above) By________________________________ By__________________________________ Jeff Mihelich, City Manager Print Name: ___________________________ Print Title: ____________________________ APPROVED AS TO FORM: By_______________________________ Greg Sullivan, Bozeman City Attorney 72 EXHIBIT A 73 74 Story Mansion Pre- Paint Repairs 3/1/2022 In preparation for the upcoming repaint of Story Mansion’s exterior there are several repairs needed to the exterior siding and trim, as well as the gutters which have some drainage issues. Carpentry Repairs: 1. Replace decorative railing on balcony above front door. 2. Replace missing siding shingle at balcony above kitchen (nw corner). 3. Secure loose quarter round trim at balcony above kitchen (nw corner). 75 4. Repair buckled bead board soffit on north side of building (west end). 5. Repair rotten fascia trim corners at either end of north side gable. 76 6. Replace several missing siding shingles on 2nd floor of turret. 7. Replace section of rotten siding shingles below window on 3rd floor of turret. 8. Replace missing siding shingle above front steps. 77 9. Replace missing piece of fascia trim on 3rd floor south facing dormer. 10. Replace missing siding shingle near southwest corner flat roof. 78 11. Assess column bases at front porch for repair. Gutter Repairs 1. Adjust gutter at 2nd floor balcony (above front door) – bent brackets causing water to leak from end cap on south side. 79 2. Carport gutter on north edge of roof – water is going behind gutter and down fascia. 80 3. Inspect northwest corner gutter section – damage to soffit may be from gutter leakage. 81 Memorandum REPORT TO:City Commission FROM:Max Ziegler, Facilities Project Coordinator Mike Gray, Facilities Superintendent Jon Henderson, Strategic Services Director SUBJECT:Authorize City Manager to Sign a Professional Services Agreement with Jackson Contractor Group Inc for Facilities Projects MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Agreement - Vendor/Contract RECOMMENDATION:Authorize City Manager to sign professional services agreement with Jackson Contractor Group Inc for Facilities Projects. STRATEGIC PLAN:4.3 Strategic Infrastructure Choices: Prioritize long-term investment and maintenance for existing and new infrastructure. BACKGROUND:The Facilities Dept. often uses general contractors for projects related to facilities management and maintenance. To attract a wider pool of contractors the Facilities Dept. published an RFQ for general contractors on April 10, 2022, with the intention of placing qualified respondents on a preferred contractor list and establishing agreements to provide general contractor services at pre-negotiated rates. This will help minimize procurement delays in responding to future facilities projects as they arise. Jackson Contractor Group responded to the RFQ, was evaluated to be qualified, and has provided a schedule of rates for services and materials to be applied to future projects. UNRESOLVED ISSUES:None. ALTERNATIVES:As suggested by City Commission FISCAL EFFECTS:Expenses for work performed under this agreement will be charged at rates stated in Attachment A. Total expenses and funding sources for future facilities projects will vary by project. Attachments: Professional Services Agreement - Facilities Contractors - Jackson Contractor Group Inc.pdf Report compiled on: June 1, 2022 82 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 1 of 12 PROFESSIONAL SERVICES AGREEMENT THIS AGREEMENT is made and entered into this _____ day of ____________, 202__ (“Effective Date”), by and between the CITY OF BOZEMAN, MONTANA, a self-governing municipal corporation organized and existing under its Charter and the laws of the State of Montana, 121 North Rouse Street, Bozeman, Montana, with a mailing address of PO Box 1230, Bozeman, MT 59771, hereinafter referred to as “City,” and, Jackson Contractor Group, Inc, 146 Laura Louise Lane, Bozeman, MT 59718, hereinafter referred to as “Contractor.” The City and Contractor may be referred to individually as “Party” and collectively as “Parties.” In consideration of the mutual covenants and agreements herein contained, the receipt and sufficiency whereof being hereby acknowledged, the parties hereto agree as follows: 1. Purpose: City agrees to enter this Agreement with Contractor to perform for City services described in the Scope of Services attached hereto as Exhibit A and by this reference made a part hereof. 2. Term/Effective Date: This Agreement is effective upon the Effective Date and will expire on the 1st day of June, 2024, unless earlier terminated in accordance with this Agreement. 3. Scope of Services: Contractor will perform the work and provide the services in accordance with the requirements of the Scope of Services. For conflicts between this Agreement and the Scope of Services, unless specifically provided otherwise, the Agreement governs. 4. Payment: City agrees to pay Contractor the amount specified in the Scope of Services. Any alteration or deviation from the described services that involves additional costs above the Agreement amount will be performed by Contractor after written request by the City, and will become an additional charge over and above the amount listed in the Scope of Services. The City must agree in writing upon any additional charges. 5. Contractor’s Representations: To induce City to enter into this Agreement, Contractor makes the following representations: 83 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 2 of 12 a. Contractor has familiarized itself with the nature and extent of this Agreement, the Scope of Services, and with all local conditions and federal, state and local laws, ordinances, rules, and regulations that in any manner may affect cost, progress or performance of the Scope of Services. b. Contractor represents and warrants to City that it has the experience and ability to perform the services required by this Agreement; that it will perform the services in a professional, competent and timely manner and with diligence and skill; that it has the power to enter into and perform this Agreement and grant the rights granted in it; and that its performance of this Agreement shall not infringe upon or violate the rights of any third party, whether rights of copyright, trademark, privacy, publicity, libel, slander or any other rights of any nature whatsoever, or violate any federal, state and municipal laws. The City will not determine or exercise control as to general procedures or formats necessary to have these services meet this warranty. 6. Independent Contractor Status/Labor Relations: The parties agree that Contractor is an independent contractor for purposes of this Agreement and is not to be considered an employee of the City for any purpose. Contractor is not subject to the terms and provisions of the City’s personnel policies handbook and may not be considered a City employee for workers’ compensation or any other purpose. Contractor is not authorized to represent the City or otherwise bind the City in any dealings between Contractor and any third parties. Contractor shall comply with the applicable requirements of the Workers’ Compensation Act, Title 39, Chapter 71, Montana Code Annotated (MCA), and the Occupational Disease Act of Montana, Title 39, Chapter 71, MCA. Contractor shall maintain workers’ compensation coverage for all members and employees of Contractor’s business, except for those members who are exempted by law. Contractor shall furnish the City with copies showing one of the following: (1) a binder for workers’ compensation coverage by an insurer licensed and authorized to provide workers’ compensation insurance in the State of Montana; or (2) proof of exemption from workers’ compensation granted by law for independent contractors. Contractor shall post a legible statement of all wages and fringe benefits to be paid to the Contractor’s employees and the frequency of such payments (i.e., hourly wage employees shall be paid weekly). Such posting shall be made in a prominent and accessible location at the Contractor’s normal place of business and shall be made no later than the first day of services provided under this Agreement. Such posting shall be removed only upon expiration or termination of this Agreement. 84 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 3 of 12 In performing the services under this Agreement, Contractor shall give preference to the employment of bona fide residents of Montana, as required by §18-2-403, MCA, as such term is defined by §18-2-401(1), MCA. When making assignments of work, Contractor shall use workers both skilled in their trade and specialized in their field of work for all work to which they are assigned. Pursuant to §§18-2-403 and 18-2-422, MCA, Contractor shall pay wages, fringe benefits, and expenses, including travel allowances as set forth in the current Montana Prevailing Wage Rate for Non Construction Services in effect and applicable to Gallatin County, Montana, which schedule is incorporated herein. Contractor shall pay all hourly wage employees on a weekly basis. Violation of the requirements set forth in the above State of Montana schedule of prevailing wage rates may subject the Contractor to the penalties set forth in §18-2-407, MCA. Contractor shall maintain payroll records during the term of this Agreement and for a period of three (3) years following termination of this Agreement. The Contractor shall ensure that any person, firm or entity performing any portion of the services under this Agreement for which the contractor, subcontractor or employer is responsible, is paid the applicable standard prevailing rate of wages. In the event that, during the term of this Agreement, any labor problems or disputes of any type arise or materialize which in turn cause any services to cease for any period of time, Contractor specifically agrees to take immediate steps, at its own expense and without expectation of reimbursement from City, to alleviate or resolve all such labor problems or disputes. The specific steps Contractor shall take shall be left to the discretion of Contractor; provided, however, that Contractor shall bear all costs of any related legal action. Contractor shall provide immediate relief to the City so as to permit the services to continue at no additional cost to City. Contractor shall indemnify, defend, and hold the City harmless from any and all claims, demands, costs, expenses, damages, and liabilities arising out of, resulting from, or occurring in connection with any labor problems or disputes or any delays or stoppages of work associated with such problems or disputes and for any claims regarding underpaid prevailing wages. 7. Indemnity/Waiver of Claims/Insurance: For other than professional services rendered, to the fullest extent permitted by law, Contractor agrees to release, defend, indemnify, and hold harmless the City, its agents, representatives, employees, and officers (collectively referred to for purposes of this Section as the City) from and against any and all claims, demands, actions, fees and costs (including attorney’s fees and the costs and fees of expert witness and consultants), losses, expenses, liabilities (including liability where activity is inherently or intrinsically dangerous) or 85 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 4 of 12 damages of whatever kind or nature connected therewith and without limit and without regard to the cause or causes thereof or the negligence of any party or parties that may be asserted against, recovered from or suffered by the City occasioned by, growing or arising out of or resulting from or in any way related to: (i) the negligent, reckless, or intentional misconduct of the Contractor; or (ii) any negligent, reckless, or intentional misconduct of any of the Contractor’s agents. For the professional services rendered, to the fullest extent permitted by law, Contractor agrees to indemnify and hold the City harmless against claims, demands, suits, damages, losses, and expenses, including reasonable defense attorney fees, to the extent caused by the negligence or intentional misconduct of the Contractor or Contractor’s agents or employees. Such obligations shall not be construed to negate, abridge, or reduce other rights or obligations of indemnity that would otherwise exist. The indemnification obligations of this Section must not be construed to negate, abridge, or reduce any common-law or statutory rights of the City as indemnitee(s) which would otherwise exist as to such indemnitee(s). Contractor’s indemnity under this Section shall be without regard to and without any right to contribution from any insurance maintained by City. Should the City be required to bring an action against the Contractor to assert its right to defense or indemnification under this Agreement or under the Contractor’s applicable insurance policies required below, the City shall be entitled to recover reasonable costs and attorney fees incurred in asserting its right to indemnification or defense but only if a court of competent jurisdiction determines the Contractor was obligated to defend the claim(s) or was obligated to indemnify the City for a claim(s) or any portion(s) thereof. In the event of an action filed against the City resulting from the City’s performance under this Agreement, the City may elect to represent itself and incur all costs and expenses of suit. Contractor also waives any and all claims and recourse against the City, including the right of contribution for loss or damage to person or property arising from, growing out of, or in any way connected with or incident to the performance of this Agreement except “responsibility for [City’s] own fraud, for willful injury to the person or property of another, or for violation of law, whether willful or negligent” as per 28-2-702, MCA. These obligations shall survive termination of this Agreement and the services performed hereunder. 86 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 5 of 12 In addition to and independent from the above, Contractor shall at Contractor’s expense secure insurance coverage through an insurance company or companies duly licensed and authorized to conduct insurance business in Montana which insures the liabilities and obligations specifically assumed by the Contractor in this Section. The insurance coverage shall not contain any exclusion for liabilities specifically assumed by the Contractor in this Section. The insurance shall cover and apply to all claims, demands, suits, damages, losses, and expenses that may be asserted or claimed against, recovered from, or suffered by the City without limit and without regard to the cause therefore and which is acceptable to the City. Contractor shall furnish to the City an accompanying certificate of insurance and accompanying endorsements in amounts not less than as follows:  Workers’ Compensation – statutory;  Employers’ Liability - $1,000,000 per occurrence; $2,000,000 annual aggregate;  Commercial General Liability - $1,000,000 per occurrence; $2,000,000 annual aggregate;  Automobile Liability - $1,000,000 property damage/bodily injury per accident; and  Professional Liability - $1,000,000 per claim; $2,000,000 annual aggregate. The above amounts shall be exclusive of defense costs. The City shall be endorsed as an additional or named insured on a primary non-contributory basis on the Commercial General, Employer’s Liability, and Automobile Liability policies. The insurance and required endorsements must be in a form suitable to City and shall include no less than a thirty (30) day notice of cancellation or non-renewal. Contractor shall notify City within two (2) business days of Contractor’s receipt of notice that any required insurance coverage will be terminated or Contractor’s decision to terminate any required insurance coverage for any reason. The City must approve all insurance coverage and endorsements prior to the Contractor commencing work. 8. Termination for Contractor’s Fault: a. If Contractor refuses or fails to timely do the work, or any part thereof, or fails to perform any of its obligations under this Agreement, or otherwise breaches any terms or conditions of this Agreement, the City may, by written notice, terminate this Agreement and the Contractor’s right to proceed with all or any part of the work (“Termination Notice Due 87 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 6 of 12 to Contractor’s Fault”). The City may then take over the work and complete it, either with its own resources or by re-letting the contract to any other third party. b. In the event of a termination pursuant to this Section 8, Contractor shall be entitled to payment only for those services Contractor actually rendered. c. Any termination provided for by this Section 8 shall be in addition to any other remedies to which the City may be entitled under the law or at equity. d. In the event of termination under this Section 8, Contractor shall, under no circumstances, be entitled to claim or recover consequential, special, punitive, lost business opportunity, lost productivity, field office overhead, general conditions costs, or lost profits damages of any nature arising, or claimed to have arisen, as a result of the termination. 9. Termination for City’s Convenience: a. Should conditions arise which, in the sole opinion and discretion of the City, make it advisable to the City to cease performance under this Agreement, the City may terminate this Agreement by written notice to Contractor (“Notice of Termination for City’s Convenience”). The termination shall be effective in the manner specified in the Notice of Termination for City’s Convenience and shall be without prejudice to any claims that the City may otherwise have against Contractor. b. Upon receipt of the Notice of Termination for City’s Convenience, unless otherwise directed in the Notice, the Contractor shall immediately cease performance under this Agreement and make every reasonable effort to refrain from continuing work, incurring additional expenses or costs under this Agreement and shall immediately cancel all existing orders or contracts upon terms satisfactory to the City. Contractor shall do only such work as may be necessary to preserve, protect, and maintain work already completed or immediately in progress. c. In the event of a termination pursuant to this Section 9, Contractor is entitled to payment only for those services Contractor actually rendered on or before the receipt of the Notice of Termination for City’s Convenience. d. The compensation described in Section 9(c) is the sole compensation due to Contractor for its performance of this Agreement. Contractor shall, under no circumstances, 88 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 7 of 12 be entitled to claim or recover consequential, special, punitive, lost business opportunity, lost productivity, field office overhead, general conditions costs, or lost profits damages of any nature arising, or claimed to have arisen, as a result of the termination. 10. Limitation on Contractor’s Damages; Time for Asserting Claim: a. In the event of a claim for damages by Contractor under this Agreement, Contractor’s damages shall be limited to contract damages and Contractor hereby expressly waives any right to claim or recover consequential, special, punitive, lost business opportunity, lost productivity, field office overhead, general conditions costs, or lost profits damages of any nature or kind. b. In the event Contractor wants to assert a claim for damages of any kind or nature, Contractor shall provide City with written notice of its claim, the facts and circumstances surrounding and giving rise to the claim, and the total amount of damages sought by the claim, within thirty (30) days of the facts and circumstances giving rise to the claim. In the event Contractor fails to provide such notice, Contractor shall waive all rights to assert such claim. 11. Representatives and Notices: a. City’s Representative: The City’s Representative for the purpose of this Agreement shall be Max Ziegler, Facilities Project Coordinator, or such other individual as City shall designate in writing. Whenever approval or authorization from or communication or submission to City is required by this Agreement, such communication or submission shall be directed to the City’s Representative and approvals or authorizations shall be issued only by such Representative; provided, however, that in exigent circumstances when City’s Representative is not available, Contractor may direct its communication or submission to other designated City personnel or agents as designated by the City in writing and may receive approvals or authorization from such persons. b. Contractor’s Representative: The Contractor’s Representative for the purpose of this Agreement shall be Nick Van Tighem, Project Development Director, or such other individual as Contractor shall designate in writing. Whenever direction to or communication with Contractor is required by this Agreement, such direction or communication shall be directed to Contractor’s Representative; provided, however, that in exigent circumstances when Contractor’s Representative is not available, City may direct its 89 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 8 of 12 direction or communication to other designated Contractor personnel or agents. c. Notices: All notices required by this Agreement shall be in writing and shall be provided to the Representatives named in this Section. Notices shall be deemed given when delivered, if delivered by courier to Party’s address shown above during normal business hours of the recipient; or when sent, if sent by email or fax (with a successful transmission report) to the email address or fax number provided by the Party’s Representative; or on the fifth business day following mailing, if mailed by ordinary mail to the address shown above, postage prepaid. 12. Permits: Contractor shall provide all notices, comply with all applicable laws, ordinances, rules, and regulations, obtain all necessary permits, licenses, including a City of Bozeman business license, and inspections from applicable governmental authorities, and pay all fees and charges in connection therewith. 13 Laws and Regulations: Contractor shall comply fully with all applicable state and federal laws, regulations, and municipal ordinances including, but not limited to, all workers’ compensation laws, all environmental laws including, but not limited to, the generation and disposal of hazardous waste, the Occupational Safety and Health Act (OSHA), the safety rules, codes, and provisions of the Montana Safety Act in Title 50, Chapter 71, MCA, all applicable City, County, and State building and electrical codes, the Americans with Disabilities Act, and all non-discrimination, affirmative action, and utilization of minority and small business statutes and regulations. 14. Nondiscrimination and Equal Pay: The Contractor agrees that all hiring by Contractor of persons performing this Agreement shall be on the basis of merit and qualifications. The Contractor will have a policy to provide equal employment opportunity in accordance with all applicable state and federal anti-discrimination laws, regulations, and contracts. The Contractor will not refuse employment to a person, bar a person from employment, or discriminate against a person in compensation or in a term, condition, or privilege of employment because of race, color, religion, creed, political ideas, sex, age, marital status, national origin, actual or perceived sexual orientation, gender identity, physical or mental disability, except when the reasonable demands of the position require an age, physical or mental disability, marital status or sex distinction. The Contractor shall be subject to and comply with Title VI of the Civil Rights Act of 1964; Section 140, Title 2, United States Code, and all regulations promulgated thereunder. Contractor represents it is, and for the term of this Agreement will be, in compliance with the requirements of the Equal Pay Act of 1963 and Section 39-3-104, MCA (the Montana Equal Pay Act). 90 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 9 of 12 Contractor must report to the City any violations of the Montana Equal Pay Act that Contractor has been found guilty of within 60 days of such finding for violations occurring during the term of this Agreement. Contractor shall require these nondiscrimination terms of its subcontractors providing services under this Agreement. 15. Intoxicants; DOT Drug and Alcohol Regulations/Safety and Training: Contractor shall not permit or suffer the introduction or use of any intoxicants, including alcohol or illegal drugs, by any employee or agent engaged in services to the City under this Agreement while on City property or in the performance of any activities under this Agreement. Contractor acknowledges it is aware of and shall comply with its responsibilities and obligations under the U.S. Department of Transportation (DOT) regulations governing anti-drug and alcohol misuse prevention plans and related testing. City shall have the right to request proof of such compliance and Contractor shall be obligated to furnish such proof. The Contractor shall be responsible for instructing and training the Contractor's employees and agents in proper and specified work methods and procedures. The Contractor shall provide continuous inspection and supervision of the work performed. The Contractor is responsible for instructing its employees and agents in safe work practices. 16. Modification and Assignability: This Agreement may not be enlarged, modified or altered except by written agreement signed by both parties hereto. The Contractor may not subcontract or assign Contractor’s rights, including the right to compensation or duties arising hereunder, without the prior written consent of the City. Any subcontractor or assignee will be bound by all of the terms and conditions of this Agreement. 17. Reports/Accountability/Public Information: Contractor agrees to develop and/or provide documentation as requested by the City demonstrating Contractor’s compliance with the requirements of this Agreement. Contractor shall allow the City, its auditors, and other persons authorized by the City to inspect and copy its books and records for the purpose of verifying that the reimbursement of monies distributed to Contractor pursuant to this Agreement was used in compliance with this Agreement and all applicable provisions of federal, state, and local law. The Contractor shall not issue any statements, releases or information for public dissemination without prior approval of the City. 91 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 10 of 12 18. Non-Waiver: A waiver by either party of any default or breach by the other party of any terms or conditions of this Agreement does not limit the other party’s right to enforce such term or conditions or to pursue any available legal or equitable rights in the event of any subsequent default or breach. 19. Attorney’s Fees and Costs: In the event it becomes necessary for either Party to retain an attorney to enforce any of the terms or conditions of this Agreement or to give any notice required herein, then the prevailing Party or the Party giving notice shall be entitled to reasonable attorney's fees and costs, including fees, salary, and costs of in-house counsel including the City Attorney’s Office staff. 20. Taxes: Contractor is obligated to pay all taxes of any kind or nature and make all appropriate employee withholdings. 21. Dispute Resolution: a. Any claim, controversy, or dispute between the parties, their agents, employees, or representatives shall be resolved first by negotiation between senior-level personnel from each party duly authorized to execute settlement agreements. Upon mutual agreement of the parties, the parties may invite an independent, disinterested mediator to assist in the negotiated settlement discussions. b. If the parties are unable to resolve the dispute within thirty (30) days from the date the dispute was first raised, then such dispute may only be resolved in a court of competent jurisdiction in compliance with the Applicable Law provisions of this Agreement. 22. Survival: Contractor’s indemnification shall survive the termination or expiration of this Agreement for the maximum period allowed under applicable law. 23. Headings: The headings used in this Agreement are for convenience only and are not be construed as a part of the Agreement or as a limitation on the scope of the particular paragraphs to which they refer. 24. Severability: If any portion of this Agreement is held to be void or unenforceable, the balance thereof shall continue in effect. 25. Applicable Law: The parties agree that this Agreement is governed in all respects by 92 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 11 of 12 the laws of the State of Montana. 26. Binding Effect: This Agreement is binding upon and inures to the benefit of the heirs, legal representatives, successors, and assigns of the parties. 27. No Third-Party Beneficiary: This Agreement is for the exclusive benefit of the parties, does not constitute a third-party beneficiary agreement, and may not be relied upon or enforced by a third party. 28. Counterparts: This Agreement may be executed in counterparts, which together constitute one instrument. 29. Integration: This Agreement and all Exhibits attached hereto constitute the entire agreement of the parties. Covenants or representations not contained herein or made a part thereof by reference, are not binding upon the parties. There are no understandings between the parties other than as set forth in this Agreement. All communications, either verbal or written, made prior to the date of this Agreement are hereby abrogated and withdrawn unless specifically made a part of this Agreement by reference. 30. Consent to Electronic Signatures: The Parties have consented to execute this Agreement electronically in conformance with the Montana Uniform Electronic Transactions Act, Title 30, Chapter 18, Part 1, MCA. 31. Extensions: this Agreement may, upon mutual agreement, be extended for a period of one year by written agreement of the Parties. In no case, however, may this Agreement run longer than five years. **** END OF AGREEMENT EXCEPT FOR SIGNATURES **** IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and year first above written or as recorded in an electronic signature. CITY OF BOZEMAN, MONTANA ____________________________________ CONTRACTOR (Type Name Above) 93 Version 8 30 21 Professional Services Agreement for Facilities Contractors – Jackson Contractor Group Page 12 of 12 By________________________________ By__________________________________ Jeff Mihelich, City Manager Print Name: ___________________________ Print Title: ____________________________ APPROVED AS TO FORM: By_______________________________ Greg Sullivan, Bozeman City Attorney 94 EXHIBIT A 95 Phone: 406-577-2772 146 Laura Louise Lane Bozeman, MT 59718 Fax: 406-587-4282 Equal Opportunity Employer May 31, 2022 Max Ziegler Facilities Project Coordinator City of Bozeman 20 East Olive Street Bozeman, Montana 59715 Dear Max, In response to the City of Bozeman Construction Services Contracts follow up request for proposal, Jackson Contractor Group offers the following: Please provide a full cost structure for the proposing firm to provide construction and contracting services covered under the scope of services, including labor rates for all staff, and materials markup. Senior Project Manager $126.00 per hour Project Manager $96.14 per hour Assistant Project Manager $88.10 per hour Senior Superintendent $133.00 per hour Project Superintendent $126.80 per hour Assistant Superintendent $99.84 per hour Senior Project Engineer $66.91 per hour Project Engineer $65.78 per hour Project Engineer IT $59.63 per hour Apprentice Carpenter $47.87 per hour Journeyman Carpenter $57.12 per hour Carpenter Foreman $64.47 per hour Laborer $45.55 per hour Operator Foreman $63.88 per hour Operator Journeyman $49.60 per hour All rates listed above are all-in rates inclusive of salary/wages, taxes, benefits, consumables, vehicles where applicable, safety, etc. For projects between $0.00 and $80,000.00 total contract value, 10% markup will apply. In your proposal please include a full scope of services you are able to provide, followed by your proposed cost structure. 96 Phone: 406-577-2772 146 Laura Louise Lane Bozeman, MT 59718 Fax: 406-587-4282 Equal Opportunity Employer Jackson Contractor Group can provide full service general contracting services and has the ability to self-perform the following scopes of work: Civil and Site work, Selective Demolition, Limited Steel Erection and Welding, Rough Carpentry activities, Finish Carpentry activities, Siding and Exterior Building Envelope, Installation of Doors, Windows and Openings, Installation of Division 10 Building Specialties, Limited Installation of Equipment, Installation of Owner Supplied Furniture, Fixtures and Equipment. The balance of scopes of work as detailed by the CSI standard divisions or as defined as a licensed trade, will be subcontracted under Jackson Contractor Group. Thank you and please let me know if there are any questions regarding this proposal. Nick Van Tighem Project Development Director 97 Memorandum REPORT TO:City Commission FROM:Cassandra Tozer, Human Resources Director SUBJECT:Authorize the Signature of the City Manager for a Schedule A Contract Revision with Vector Solutions for Learning Management Software Billing Cycle MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Agreement - Vendor/Contract RECOMMENDATION:Authorize signature of City Manager of schedule A contract revision with Vector Solutions. STRATEGIC PLAN:7.2 Employee Excellence: Recruit, retain and value a diverse, well-trained, qualified and motivated team capable of delivering superior performance. Be accountable and expect accountability from others. Make demonstrated use of good judgement a part of the evaluation process for promotions. BACKGROUND:In April 2020 the City entered into an agreement with Vector Solutions (then Target Solutions) to fulfill the mandate in section 7 of our Strategic Plan (High performing Organization). Vector Solutions provides a Learning Management System (LMS) that will allow Human Resources to assign, track, and create training for the City’s employees. This Schedule A Revision will put the Vector Solutions invoice on a Fiscal Year schedule for payment and budgeting. UNRESOLVED ISSUES:None. ALTERNATIVES: As suggested by the City Commission. FISCAL EFFECTS:None. Attachments: City of Bozeman (MT) Vector Solutions Renewal Date Change 5_17_2022.pdf Report compiled on: May 31, 2022 98 Quote ID Q-178309 Valid Until Thursday, June 30, 2022 Contact Name Kennith Ainsworth Schedule A – Revision This Contract Revision Form replaces and supersedes Schedule A to the Client Agreement signed on April 30, 2020 between the Vector Solutions entity and the Client named below as of the Effective Date (Contract Revision Order No. 1 Effective Date). Date: Tuesday, May 17, 2022 Client Information Client Name: City of Bozeman (MT) Address: 121 North Rouse Avenue Bozeman, MT 59715 Primary Contact Name: Eilis Gehle Primary Contact Phone: (406) 582-2275 Agreement Term Effective Date: 07/01/2022 Initial Term: 12 months Invoicing Contact Information (Please fill in missing information) Billing Contact Name: Human Resources Billing Address: 121 N. Rouse Ave Bozeman, Montana 59715 Billing Phone: (406) 582-2275 Billing Email: humanresources@bozeman.net PO#: Billing Frequency: Annual Payment Terms: Net 30 Fees Product Code Product Name Description Qty Price Sub Total TSPREMIER Vector LMS, TargetSolutions Edition Premier Membership Training management for public entities and professionals 442 $51.98 $22,975.16 TSENT Enterprise Solution Enterprise Solutions for Vector LMS, TargetSolutions Edition 1 $500.00 $500.00 TSMAINTFEES Vector LMS, TargetSolutions Edition - Maintenance Fee Annual maintenance of Vector LMS, TargetSolutions Edition 3 $195.00 $585.00 TSELECTRICLIB FM&M Electrical Maintenance Catalog FM&M Electrical Maintenance Catalog for Vector LMS, TargetSolutions Edition 6 $112.27 $673.62 99 2 of 2 NRO Non-Recurring Overage Overage for: Vector LMS, TargetSolutions Edition Premier Membership: Prorated Fee to cover gap in service from old renewal date to new. 4/30/2022 – 07/01/2022 1 $3,829.20 $3,829.20 Grand Total: $28,562.98 Please note that this is not an invoice. An invoice will be sent within fourteen (14) business days. The Parties have executed this Agreement by their authorized representatives as of the last date set forth below. Target Solutions Learning, LLC d/b/a Vector Solutions City of Bozeman (MT) 4890 W. Kennedy Blvd., Suite 300 Tampa, FL 33609 121 North Rouse Avenue Bozeman, MT 59715 By: \ \s2\ By: \ \s1\ Printed Name: Jackelin Maguire Printed Name: Title: Senior Renewal Manager - Team Lead Title: Date: \ \d2\ Date: \ \d1\ 100 Memorandum REPORT TO:City Commission FROM:Cody Flammond, Engineer II Lance Lehigh, Interim City Engineer Nicholas Ross, Transportation and Engineering Director SUBJECT:Authorize the City Manager to Sign a Change Order to the Task Order with Tetra Tech, Inc for Groundwater and Perimeter Methane Monitoring and Assessment of System Performance and Effectiveness at the Bozeman Story Mill Landfill for Fiscal Year 2022 MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Agreement - Vendor/Contract RECOMMENDATION:Authorize the City Manager to Sign a Change Order to the Task Order with Tetra Tech, Inc for Groundwater and Perimeter Methane Monitoring and Assessment of System Performance and Effectiveness at the Bozeman Story Mill Landfill for Fiscal Year 2022. STRATEGIC PLAN:4.3 Strategic Infrastructure Choices: Prioritize long-term investment and maintenance for existing and new infrastructure. BACKGROUND:The purpose of this change order is to fund the remaining work scheduled under the current task order. Unanticipated operational issues with the Story Mill landfill gas extraction system were encountered that required extended troubleshooting and equipment component replacement. This change order will replace the funds used to address these issues and allow the necessary work at the landfill to continue. This change order will be implemented under the professional services agreement referenced here: http://weblink.bozeman.net/WebLink8/0/doc/63070/Electronic.aspx. UNRESOLVED ISSUES:None ALTERNATIVES:As suggested by the City Commission. FISCAL EFFECTS:The cost of this work will be $14,485.00. This work will be paid for with solid waste funds dedicated to this purpose. Attachments: Exhibit A 101 Report compiled on: June 1, 2022 102 103 Memorandum REPORT TO:City Commission FROM:Tom Rogers, Senior Planner Brian Heaston, Engineer III Chris Saunders, Community Development Manager Anna Bentley, Community Development Interim Director SUBJECT:Ordinance 2108 Final Adoption Amending Well Use Requirement Update the City of Bozeman (City) Regulations to Conform to Revised Regulations of Montana Department of Natural Resources and Conservation, Application 22137 MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Ordinance RECOMMENDATION:Having reviewed and considered the staff report, draft ordinance, public comment, and all information presented, I hereby adopt the findings presented in the staff report for application 22137, and move to finally adopt Ordinance 2108. STRATEGIC PLAN:4.1 Informed Conversation on Growth: Continue developing an in-depth understanding of how Bozeman is growing and changing and proactively address change in a balanced and coordinated manner. BACKGROUND:The City Commission preliminarily adopted this application on May 24, 2022. This text amendment is a generally applicable code change. Application materials and staff report are available with the initial packet as item I.3 the City Commission packet. The video recording of the City Commission is also available. Provisional adoption of Ordinance 2112 occurred on May 24, 2022. UNRESOLVED ISSUES:None ALTERNATIVES:As identified by the City Commission. FISCAL EFFECTS:No budgeted finds are used by this action. Attachments: Ordinance 2108_Irrigation Water Supply 5-13-22 w strike through and underline.pdf Report compiled on: May 31, 2022 104 Ordinance 2108, Amending Well Irrigation Requirements of the Bozeman Municipal Code Page 1 of 8 ORDINANCE 2108 AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA AMENDING BOZEMAN MUNICIPAL CODE SECTION 38.550.070 – LANDSCAPING OF PUBLIC LANDS AND SECTION 38.420.080 – PARK DEVELOPMENT AND PROVIDING AN EFFECTIVE DATE WHEREAS, the City of Bozeman (the “City”) has adopted land development and use standards to protect public health, safety and welfare and otherwise execute the purposes of Montana Code Annotated §§ 76-1-102, 76-2-304, 76-3-102, and 76-3-501; and WHEREAS, after proper notice, the Community Development Board in their capacity as Bozeman Zoning Commission and Planning Board held a public hearing on May 16, 2022 to receive and review all written and oral testimony on the proposed amendments; and WHEREAS, the Community Development Board acting in their capacity as the Bozeman Zoning Commission and Planning Board recommended to the Bozeman City Commission that Ordinance 2108, be approved as proposed; and WHEREAS, after proper notice, the City Commission held its public hearing on June 7, 2022, to receive and review all written and oral testimony on the proposed amendment to the subdivision regulations; and WHEREAS, the City Commission has reviewed and considered the applicable amendment criteria established in Montana Code Annotated § 76-2-304, and found that the proposed amendments are in compliance with the criteria; and NOW, THEREFORE, BE IT ORDAINED by the City Commission of the City of Bozeman, Montana that: SECTION 1 Legislative Findings The City Commission hereby makes the following findings in support of adoption of this Ordinance: 105 Ordinance 2108, Amending Well Irrigation Requirements of the Bozeman Municipal Code Page 2 of 8 1. The City has adopted land development and use standards to protect public health, safety and welfare and otherwise execute the purposes of Montana Code Annotated §§ 76-1-102, 76-2-304, 76-3-102, and 76-3-501. 2. The City adopted a growth policy, the Bozeman Community Plan 2020 (BCP 2020), by Resolution 5133 to establish policies for development of the community. 3. The existing municipal water supply of the City of Bozeman is an essential resource that sustains public health, safety and welfare and is highly susceptible to the impacts of drought therefore necessitating wise use and conservation of the limited water resource. 4. The City of Bozeman has enacted development regulations within its unified development code to conserve the existing municipal water supply by requiring the use of groundwater wells for irrigation of parks, open spaces and certain rights-of-way areas in new developments. 5. That landscapes in parks, open spaces and rights-of-way demand irrigation water supplies that are physically and legally adequate to maintain healthy and viable landscape areas for the public’s use and enjoyment. 6. All waters within the State of Montana are owned by the state and the legal use of water requires a water right. 7. The Montana Department of Natural Resources and Conservation (MT DNRC) is the agency of the State of Montana that is authorized under the laws of the state to issue new water rights or changes to existing water rights and water right permits. 8. On March 23, 2022 the MT DNRC revised its ‘Combined Appropriation Guidance’ (attached to this Ordinance 2108 as Exhibit A) to clarify that any subdivision of land, as defined under Montana Code Annotated §76-4-102, created after October 17, 2014 that uses groundwater, must receive a pre-determination from MT DNRC that all exempt wells proposed for the subdivision will stay at or under a combined appropriation of 10 acre-feet per year regardless of the distance between proposed wells. 9. A combined appropriation of groundwater for a project or development exceeding 35 gallons per minute and 10 acre-feet per year requires a water right permit (“permitted wells”) and a combined appropriation under 10 acre-feet per year using wells pumping no more than 35 gallons per minute is exempt from permitting (“exempt wells”). 10. With limited exception, exempt wells serve as the physical and legal irrigation water source for existing parks, open spaces and certain rights-of-way areas in the City of Bozeman. 11. The current MT DNRC process to obtain a permitted irrigation well in a closed basin is protracted, cumbersome, technically complex and, unlike an exempt irrigation well, is without a reasonably certain or guaranteed outcome that a water right will be obtained. 12. It is unlikely that all new development applicants will be able to comply with the existing City of Bozeman requirement that, without exception, all parks, open spaces, and certain rights-of-way areas use a well for irrigation considering the March 23, 2022 Combined Appropriation Guidance because, unlike an exempt irrigation well, there is no guaranteed outcome that an applicant can obtain a permit for an irrigation permitted well from MT DNRC. 106 Ordinance 2108, Amending Well Irrigation Requirements of the Bozeman Municipal Code Page 3 of 8 13. Amendments of certain municipal code sections enacted by this Ordinance 2108 are necessary to remove the mandatory requirement that wells be used for irrigation of parks, open space and certain rights-of-way areas in new developments in order to avoid undue hardship created by the March 23, 2022 Combined Appropriation Guidance and to provide necessary flexibility to allow for other sources of irrigation water supply for these landscaped areas. 14. A staff report analyzing the required criteria for an amendment to the City’s regulations for zoning review, including the amendment’s accordance with the BCP 2020, and has found that the required criteria of Montana Code Annotated § 76-1-304 are satisfied. 15. The necessary public hearings were advertised as required in state law and municipal code and all persons have had opportunity to review the applicable materials and provide comment. 16. The City Commission considered the application materials, staff analysis and report, recommendation of the Community Development Board acting in their capacity as the municipal Zoning Commission and Planning Board, all submitted public comment, and all other relevant information. 17. The Community Development Board acting in its capacity as the municipal Zoning Commission and Planning Board considered the application materials, staff analysis and report, all submitted public comment, and all other relevant information. 18. The City Commission determines that, as set forth in the staff report and incorporating the staff findings as part of the decision, the required criteria for approval of this ordinance are satisfied. 19. The City Commission determines that the ordinance provides a proper balance of interests, rights, and responsibilities of all parties affected by the ordinance. SECTION 2 Section 38.550.070. - Landscaping of public lands of the Bozeman Municipal Code be amended as follows: Sec. 38.550.070. - Landscaping of public lands. A. City rights-of-way, open space and parks. 1. General. a. Tree planting permits must be obtained from the forestry department prior to installation of trees in city rights-of-way or parks. b. Drought tolerant landscaping grass seed must be planted in these areas open space, parks and city rights-of-way, unless otherwise approved by the City. 2. External Sstreets, open space, and parks. The developer must at the time of initial development for installing vegetative ground cover drought tolerant landscaping, boulevard trees and an irrigation system when required in the public city rights-of-way 107 Ordinance 2108, Amending Well Irrigation Requirements of the Bozeman Municipal Code Page 4 of 8 boulevard strips and medians along all external perimeter development collector or arterial streets and all streets adjacent to public parks or other open space areas. a. Prior to installing landscaping in these areas, city rights-of-way or parks, the developer must submit a landscaping plan to the facilities manager city for review and approval. The landscaping plan must be prepared by a qualified landscaping professional meeting the requirements of this division 38.550. Tree planting permits must be obtained before any tree is placed on public land. b. The developer must specify its irrigation water supply source(s). bc. Wells must may be used to irrigate landscaping in these areas subject to applicable state law governing the appropriation of groundwater. i. The appropriation and use of groundwater for irrigation of parks and city rights-of-way takes priority over irrigation of open space and individual lots. d. The developer must transfer to the city legal ownership of any water rights used for the irrigation these areas. 3. Adjacent to individual lots. When individual parcels are developed, the individual property owners' must install landscaping and street trees within the public city rights- of-way boulevard strips adjacent to their property, and providing for provide irrigation, in compliance with section 38.550.050.E.1. B. Maintenance. 1. Maintenance of landscaping installed within the boulevard portion of the public right- of-way, with the exception of tree trimming and tree removal, is the responsibility of adjacent property owners'. 2. A developer must irrigate and maintain landscaping along external streets and landscaping adjacent to parks or other open space areas until 50 percent of the lots are sold. Thereafter, the property owners’ association is responsible for maintaining and irrigating these landscaped areas. The property owners’ association may, with the city’s approval, establish an improvement district to collect assessments to pay for the irrigation and maintenance. 3. The City is responsible for the maintenance of all other required landscaping installed in accordance with approved site plans within the public right-of-way or on public lands. 2. The developer must maintain landscaping and irrigation systems for open space until the open space is transferred to a property owners’ association. After a property owners’ association assumes responsibility for the maintenance of landscaping and irrigation systems for open space areas, it may establish an improvement district to collect assessments to pay for the irrigation and maintenance with the city’s approval. 3. The developer must maintain landscaping and irrigation systems for parklands until the parkland is accepted by the City. After the City accepts parkland, the City is responsible for maintaining the landscaping and irrigation systems for the parkland. C. State rights-of-way. Landscaping must be installed along state rights-of-way, in the same manner described in this section, provided that the state department of transportation has 108 Ordinance 2108, Amending Well Irrigation Requirements of the Bozeman Municipal Code Page 5 of 8 reviewed and approved the proposed landscaping plan. Maintenance of landscaping installed within the boulevard portion of the public state right-of-way is the responsibility of adjacent property owners' unless a different responsibility is established by the encroachment permit. SECTION 3 Section 38.420.080. – Park development of the Bozeman Municipal Code be amended as follows: Sec. 38.420.080. Park development. A. General. Developers must consult any adopted citywide park plan, and with the parks department which implements the plan, to determine the types of parks needed for the proposed development and surrounding area. Parks must be developed in accordance with the citywide park plan and any approved park master plan. At a minimum, all parks must be improved to the following standards by the developer, prior to final plat or final occupancy approval as appropriate: 1. Minimum required improvements to land dedications. The subdivider developer must level any park area, amend the soil, seed disturbed areas to allow mowing with turf type mowers, and install an underground irrigation system in compliance with city standards and specifications, unless otherwise provided in an approved Park Master Plan. a. Parks must contain be seeded with drought tolerant landscaping grass seed unless approved otherwise provided in an approved park master plan. writing by the park superintendent. 2. Irrigation. The developer must irrigate the park area until 50 percent of the subdivision lots or condominium units are sold. Thereafter, the property owners’ association must be responsible for park irrigation. The property owners’ association may establish an improvement district to collect assessments to pay for irrigation. Parks must have an irrigation water supply that is legally and physically adequate to meet the irrigation water demands of the park landscape. The developer must ensure the city obtains legal ownership of any irrigation water rights used to irrigate parks. a. Wells may must be used to irrigate parkland subject to Sec. 38.550.070 BMC. b. Existing irrigation water rights appurtenant to parkland may be used for irrigation subject to city review and approval. c. The city’s municipal water supply may be used for irrigation of parkland, but only if wells and existing irrigation water rights are inadequate to meet the water demands of the parkland. B. Boundaries. The park boundary bordering all private lots must be delineated at the common private/public corner pins, with flat, flexible fiberglass posts, a minimum of six feet in length with no less than two feet driven into the ground. Each post must be labeled with a permanent glued on sign stating "Park Boundary" or "Property Boundary." Other forms of boundary marking may be approved by the planning or other appropriate department. 109 Ordinance 2108, Amending Well Irrigation Requirements of the Bozeman Municipal Code Page 6 of 8 C. Sidewalks. Sidewalks, when required within the development, must be installed by the developer at points where the park borders or crosses public or private streets. D. Stormwater detention/retention ponds. Stormwater retention or detention ponds may be located within public parkland, but such areas do not count towards the parkland dedication requirement. Any stormwater ponds located on parkland must be designed, constructed and/or added to so as to be conducive to the normal use and maintenance of the park. Stormwater ponds may not be located on private lots. Stormwater retention or detention ponds must be maintained by the property owners' association. E. Clean up required. All fencing material, construction debris and other trash must be removed from the park area. SECTION 4 Repealer. All provisions of the ordinances of the City of Bozeman in conflict with the provisions of this ordinance are, and the same are hereby, repealed and all other provisions of the ordinances of the City of Bozeman not in conflict with the provisions of this ordinance shall remain in full force and effect. SECTION 5 Savings Provision. This ordinance does not affect the rights and duties that matured, penalties that were incurred or proceedings that were begun before the effective date of this ordinance. All other provision of the Bozeman Municipal Code not amended by this Ordinance shall remain in full force and effect. SECTION 6 Severability. That should any sentence, paragraph, subdivision, clause, phrase or section of this ordinance be adjudged or held to be unconstitutional, illegal, or invalid, the same shall not affect the validity of this ordinance as a whole, or any part or provision thereof, other than the part so decided to be invalid, illegal or unconstitutional, and shall not affect the validity of the Bozeman Municipal Code as a whole. SECTION 7 Codification. The provisions of Section 2 and Section 3 shall be codified as appropriate in the Bozeman Municipal Code. All references within the Bozeman Municipal Code shall be revised to reflect the changes in this ordinance. SECTION 8 110 Ordinance 2108, Amending Well Irrigation Requirements of the Bozeman Municipal Code Page 7 of 8 Effective Date. This ordinance shall be in full force and effect on July 7, 2022. PROVISIONALLY ADOPTED by the City Commission of the City of Bozeman, Montana, on first reading at a regular session held on the 24th day of May, 2022. ____________________________________ Cynthia L. Andrus Mayor ATTEST: _________________________________ Mike Maas City Clerk FINALLY PASSED, ADOPTED, AND APPROVED by the City Commission of the City of Bozeman, Montana on second reading at a regular session thereof held on the 7th day of June, 2022. ____________________________________ Cynthia L. Andrus Mayor ATTEST: _______________________________ Mike Maas City Clerk APPROVED AS TO FORM: 111 Ordinance 2108, Amending Well Irrigation Requirements of the Bozeman Municipal Code Page 8 of 8 ____________________________________ Greg Sullivan City Attorney 112 Memorandum REPORT TO:City Commission FROM:David Fine, Economic Development Program Manager Brit Fontenot, Economic Development Director SUBJECT:Resolution 5420 Approving Certain Projects in the South Bozeman Technology Tax Increment Financing District as Technology Infrastructure Development Projects and Using Tax Increment Revenues or Tax Increment Revenue Bonds to Reimburse Eligible Costs of Such Projects; Approving a Related Development Agreement; and Making a Reimbursement Declaration MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Resolution RECOMMENDATION:Having considered public comment and all information presented, I move to adopt Staff findings in the Commission Memorandum and approve Resolution 5420. STRATEGIC PLAN:2.2 Infrastructure Investments: Strategically invest in infrastructure as a mechanism to encourage economic development. BACKGROUND:Please see the attached Commission Memorandum. UNRESOLVED ISSUES:None at this time. ALTERNATIVES:At the suggestion of the City Commission. FISCAL EFFECTS:Please see the attached Commission Memorandum. Attachments: CC Memo Resolution 5420 SBTD 20220614.pdf Resolution approving MSUIC projects.v2.pdf City of Bozeman MSUIC Financial Review Summary Memo Update 060222.pdf BZN Development Agreement -- MSUIC.v4.docx MSUIC TIF Application Package.pdf Report compiled on: May 31, 2022 113 Commission Memorandum REPORT TO: Honorable Mayor and City Commission FROM: David Fine, Economic Development Program Manager Brit Fontenot, Economic Development Director SUBJECT: Public Hearing for Resolution 5420 - A Resolution Approving Certain Projects in the South Bozeman Technology Tax Increment Financing District as Technology Infrastructure Development Projects and Using Tax Increment Revenues or Tax Increment Revenue Bonds to Reimburse Eligible Costs of Such Projects; Approving a Related Development Agreement; and Making a Reimbursement Declaration MEETING DATE: June 14, 2022 AGENDA ITEM TYPE: Action RECOMMENDED MOTION: I move to adopt Staff's findings in the Commission Memorandum and approve Resolution 5420. Background: The Bozeman City Commission created the South Bozeman Technology District (the "District") in December, 2012 and authorized the District's use of tax increment financing to support a wide array of statutorily defined activities within the District, including the development of public infrastructure. Click here to review the District’s comprehensive development plan. A primary purpose of creating the South Bozeman Technology District (the "District") was to address existing public infrastructure deficiencies on property envisioned for use by the Montana State University Innovation Campus ("MSUIC") as a location to create a campus of innovation excellence. Currently, the Advanced Research Laboratory (“ARL”) is complete in the south east corner of the site. Additional site development, via infrastructure and new building construction, is planned for the property over the next few years continuing to deploy the necessary infrastructure to facilitate the aforementioned development. In the effort to create and sustain the MSUIC as an innovation leader and economic driver in this region, the City continues to support MSU, the MSU Foundation, the MSUIC and other community partners to carry out the vision of the Innovation Campus. The MSUIC Board 114 was very active and much has been accomplished to get the first facility, the Advanced Research Laboratory (“ARL”), completed and set the stage for the development of the balance of the property within the District and on the MSUIC site. The efficient future development of the site requires the installation of basic public infrastructure upfront, which creates a significant cost burden for any one development project. The Projects As the Developer of the MSUIC, Charter Realty and Development has attracted two new exciting tenants to the campus.  Aurora acquired Blackmore, a Bozeman company developing lidar based technologies to facilitate autonomous vehicles. Aurora recently announced their intent to build a 78,000 square foot facility to “grow our team and produce future generations of Aurora’s FirstLight Lidar to support our expanding fleet of commercial autonomous vehicles. This modern two-story facility will feature research and development labs, a world-class manufacturing space and clean room facility, a garage, and office and collaboration space for our Bozeman team. We are also collaborating with Montana State University (MSU) to open a new, state-of-the-art lidar test range.”  INDUSTRY is an 86,000 square foot flexible office building with 61,000 SF of offices and 25,000 SF of shared common spaces. The INDUSTRY project addresses the lack of available office space for growing firms in the technology industry, which is an identified issue in the City’s economic development strategy. INDUSTRY allows growing firms flexible lease terms and the ability to scale their operation under one roof, with access to common amenities. Resolution 5420 designates the Aurora Project and the INDUSTRY Project (the “Projects”) and the public infrastructure required to complete these projects as Technology Infrastructure Development Projects, as defined by the Technology District Act. The Resolution authorizes the City Manager to sign the proposed Development Agreement. The Resolution approves using tax increment revenues or proceeds of tax increment revenue bonds to pay or reimburse Big Sky ICINF, LLC, as the developer of the project for up to $3,599,178 in certain eligible costs of associated Infrastructure Improvements. These costs are detailed in Exhibit “C” of the Development Agreement. Required Findings The Technology District Act (of Montana Code Annotated, Title 7, Chapter 15, Parts 42 and 43, as in effect on December 31, 2012) requires, as a criterion for approval of a technology infrastructure development project, that the City Commission make the following findings. 115 These findings are included in Resolution 5420 in Section 2. Staff makes the following conclusions regarding these findings: a. the Projects are technology infrastructure development projects, and the Projects and the Infrastructure Improvements will encourage the location and retention of technology infrastructure development projects within the District and the State of Montana;  The proposed public infrastructure improvements including public street, water, sewer and sidewalk infrastructure is basic infrastructure for the development of the Montana State University Innovation Campus within the South Bozeman Technology District. This infrastructure will allow the campus to be developed with tenants that advance technology-based economic development on the campus. b. the Projects will encourage the location of tenants in the District that are businesses or organizations engaged in technology-based operations within Montana that, through employment of knowledge or labor, add value to a product, process or export service that results in the creation of new wealth and for which at least 50% of the sales of the business or organization occur outside of Montana or businesses or organizations that are manufacturing companies with at least 50% of their sales to other Montana companies that have 50% of their sales occurring outside of Montana; and  Aurora is a technology company using LIDAR technology that is largely developed in Bozeman, which is “On a mission to deliver the benefits of self- driving – safely, quickly, and broadly.” Aurora’s client base is global in scale and its inclusion in the Projects assures that at least 50% of sales will occur outside of Montana. c. the costs of the Infrastructure Improvements are costs permitted to be paid from tax increment revenues or proceeds of tax increment bonds under Section 7-15- 4288 of the Technology District Act.  The proposed public infrastructure improvements are eligible costs under the Technology District Act. Staff Recommendation Staff Recommends providing TIF Assistance to the Project. The South Bozeman Technology District was created to advance the goals of creating an innovation campus for Montana State University and to attract precisely the kinds of tenants like Aurora and INDUSTRY that are now proposed for the site. The infrastructure deficiencies of the site have constrained development of the campus for years and represent a significant cost for any one commercial development. TIF incentives allow infrastructure construction that 116 would likely not be financially feasible, “but for” TIF incentives. Incentives may create the potential for higher returns to mitigate higher risk, which will likely attract investment that would not occur without these incentives. The proposed incentive request of $3,599,178 is consistent with the goals of the South Bozeman Technology District Comprehensive Development Plan. With an aggregate cost of for the Projects of $85M this represents a ratio of private to public investment of 23.62:1. This produces an outstanding ROI for the District. In order to ensure that the level of assistance makes the project feasible, but does not provide unreasonable returns to the developer, staff hired Baker Tilly (BT) to provide a third party assessment of the development pro forma. Staff contracts for this component of the review process to assess the reasonableness of each Applicant’s incentive request. BT concluded their analysis and found that the Applicant did demonstrate a need for TIF Assistance for the project. Baker Tilly’s analysis of the project is attached for Commission review. The Projects create significant new taxable value. A primary goal of districts which employ a tax increment financing provision is to facilitate new investment and the creation of new taxable value for the long-term benefit of the broader community. The Applicant projects that the project will create $800,000 in net new taxable value each year. An independent analysis by Baker Tilly projected a range of expected tax generation between $504,949 and $726,786. Even with Baker Tilly’s conservative approach, the Project is expected to generate significant new taxes. Finally, the Aurora and INDUSTRY projects support long standing planning and programmatic objectives of the City’s Economic Development Department. Aurora’s expansion in Bozeman is a testament to the City’s longstanding support of the photonics sector and growing local businesses (Aurora acquired the Bozeman-based Blackmore in 2019). INDUSTRY addresses the goal of increasing the availability of flexible office space to support fast growing technology companies. These companies are not well suited to Bozeman’s traditional office space market with long lease terms and limited tenant improvement allowances. A company that starts with 5 employees and plans to grow to 50 in 3 years needs more flexibility in their space planning. INDUSTRY provides this flexibility as well as a dynamic and collaborative working environment. Given the satisfaction of these public policy goals, Staff recommends approval of the full funding request. Fiscal Effects: The Development Agreement stipulates that the City will reimburse Developer for the Reimbursable Amount not-to-exceed $3,599,178. Pursuant to the proposed Development Agreement, the City would agree to reimburse the Developer only after the project has paid taxes for one full fiscal year, and then, would only reimburse Big Sky ICINF, LLC if for an amount 117 for which there is sufficient tax increment to provide a Coverage Ratio of 1.7 for any bonds issued to provide reimbursement. 118 RESOLUTION NO. 5420 RESOLUTION APPROVING CERTAIN PROJECTS IN THE SOUTH BOZEMAN TECHNOLOGY TAX INCREMENT FINANCING DISTRICT AS TECHNOLOGY INFRASTRUCTURE DEVELOPMENT PROJECTS AND USING TAX INCREMENT REVENUES OR TAX INCREMENT REVENUE BONDS TO REIMBURSE ELIGIBLE COSTS ASSOCIATED WITH SUCH PROJECTS; APPROVING A RELATED DEVELOPMENT AGREEMENT; AND MAKING A REIMBURSEMENT DECLARATION BE IT RESOLVED by the City Commission (the “Commission”) of the City of Bozeman, Montana (the “City”), as follows: Section 1 Recitals. 1.01. Under the provisions of Montana Code Annotated, Title 7, Chapter 15, Parts 42 and 43, as in effect on December 31, 2012 (the “Act”), the City was authorized to create technology districts for the purpose of encouraging the location and development of technology infrastructure development projects in the State of Montana, to provide for the segregation and collection of tax increment with respect to property taxes collected in such technology districts, and to apply tax increment revenues derived from projects undertaken within the technology districts to pay eligible costs. 1.02. Pursuant to the Technology District Act and Ordinance No. 1844 adopted by the City Commission of the City (the “City Commission”) on December 19, 2012 (the “Ordinance”), the City has created the South Bozeman Technology Tax Increment Financing District (the “District”) as a technology district. By Resolution No. 4414, adopted by the City Commission 119 Resolution 5420, Approving Projects in the South Bozeman Technology Tax Increment Financing District 2 on November 5, 2012, the City Commission has adopted the South Bozeman Technology District Comprehensive Development Plan (the “Plan”) as a comprehensive development plan that ensures that the District can host a diversified tenant base of multiple independent tenants, in accordance with the Technology District Act. The Plan provides for the segregation and collection of tax increment revenues with respect to the District. 1.03. Big Sky QF, LLC, a Delaware limited liability company (“BSQ”), has leased approximately 4.87 acres of land located in the District from Montana State University Innovation Campus, a Montana non-profit corporation (“MSUIC”), and has subleased such land (the “Industry Land”) to Industry Bozeman Property, LLC, a Montana limited liability company (“IBP”) on May 26, 2022. IBP proposes to undertake the construction on the Industry Land of an approximately 86,000 square foot building to be used as flexible commercial workspace, to include 61,000 square feet of offices and 25,000 square feet of indoor common space, as well as related site improvements and related improvements (the “INDUSTRY Project”). In addition, BIG SKY AURORA, LLC, a Delaware limited liability company (“BSA”) has leased approximately 4.80 acres of land located in the District from MSUIC and has subleased such land (the “Aurora Land”) to Aurora Operations, Inc., a Delaware corporation (“AOI”) on February 17, 2022. BSA proposes to undertake the construction on the Aurora Land of an approximately 78,000 square foot building to be leased to AOI for use as office space, research and design activities and potentially manufacturing, as well as related site improvements (the “Aurora Project” and, together with the INDUSTRY Project, the “Projects”). In furtherance of the Projects, BSQ and BSA propose to undertake the construction of certain infrastructure improvements, including construction of street, curb, gutter and sidewalk improvements, street lighting improvements, water and sewer line extensions, storm sewer infrastructure, utilities, related landscaping and related improvements (collectively, the “Infrastructure Improvements”). Big Sky ICINF, LLC, a Delaware limited liability company (the “Developer”), is an affiliate of BSQ and BSA, and has requested that the City approve using tax increment revenues or proceeds of tax increment revenue bonds to reimburse the Developer for the costs of the Infrastructure Improvements. 120 Resolution 5420, Approving Projects in the South Bozeman Technology Tax Increment Financing District 3 1.04. On June 14, 2022, a duly noticed public hearing was held on the question of approving the Projects as technology infrastructure development projects, and the use of tax increment revenues or proceeds of tax increment bonds to reimburse the Developer for costs of the Infrastructure Improvements and all persons appearing were given an opportunity to speak at the public hearing. Section 2 Findings. The Commission hereby finds with respect to the Projects as follows: a. the Projects are technology infrastructure development projects, and the Projects and the Infrastructure Improvements will encourage the location and retention of technology infrastructure development projects within the District and the State of Montana; b. the Projects will encourage the location of tenants in the District that are businesses or organizations engaged in technology-based operations within Montana that, through employment of knowledge or labor, add value to a product, process or export service that results in the creation of new wealth and for which at least 50% of the sales of the business or organization occur outside of Montana or businesses or organizations that are manufacturing companies with at least 50% of their sales to other Montana companies that have 50% of their sales occurring outside of Montana; and c. the costs of the Infrastructure Improvements are costs permitted to be paid from tax increment revenues or proceeds of tax increment bonds under Section 7- 15-4288 of the Technology District Act. Section 3 Approval of the Projects as Technology Infrastructure Development Projects. 121 Resolution 5420, Approving Projects in the South Bozeman Technology Tax Increment Financing District 4 The Commission hereby approves the Projects as technology infrastructure development projects under the Technology District Act and the Plan. The Projects and the Infrastructure Improvements are contemplated by and within the scope of the Plan, and the Infrastructure Improvements are eligible for tax increment financing under the Technology District Act. Section 4 Development Agreement; Use of Tax Increment. 4.01. The City’s Director of Economic Development and the Developer have negotiated a Development Agreement, the form of which is attached hereto as Exhibit A. The Development Agreement is hereby approved in substantially the form attached. The City Manager, or in the event of his absence or disability, his designee, is hereby authorized and directed to finalize, approve, execute and deliver to the Developer the Development Agreement, substantially in the form attached as Exhibit A, with such changes as such officer shall deem necessary or appropriate. The execution and delivery by an appropriate officer of the City of the Development Agreement shall be conclusive as to the approval of such officer of the terms of the Development Agreement. 4.02. The Commission hereby approves the use of tax increment revenues or proceeds of tax increment bonds to reimburse the Developer for the Infrastructure Improvements, subject to the terms and conditions of the Development Agreement. No further Commission action shall be required if the City’s obligations under the Development Agreement are to be paid or satisfied with tax increment revenues then on hand and available therefor. If the City’s obligations under the Development Agreement are to be financed with proceeds of tax increment revenue bonds, the forms of such bonds and the terms and conditions thereof shall be prescribed by a subsequent resolution or resolutions to be adopted by this Commission. 122 Resolution 5420, Approving Projects in the South Bozeman Technology Tax Increment Financing District 5 Section 5 Reimbursement. 5.01. The City may issue tax-exempt bonds in one or more series (the “Bonds”) to finance all or a portion of the Infrastructure Improvements and pay costs associated with the financing. The United States Department of Treasury has promulgated regulations governing the use of proceeds of tax-exempt bonds, all or a portion of which are to be used to reimburse the City for project expenditures paid by the City prior to the date of issuance of such bonds. Those regulations (Treasury Regulations, Section 1.150-2) (the “Regulations”) require that the City adopt a statement of official intent to reimburse an original expenditure not later than 60 days after payment of the original expenditure. The Regulations also generally require that the bonds be issued and the reimbursement allocation made from the proceeds of the bonds within 18 months (or three years, if the reimbursement bond issue qualifies for the “small issuer” exception from the arbitrage rebate requirement) after the later of (i) the date the expenditure is paid or (ii) the date the project is placed in service or abandoned, but (unless the issue qualifies for the “small issuer” exception from the arbitrage rebate requirement) in no event more than three years after the date the expenditure is paid. The Regulations generally permit reimbursement of capital expenditures and costs of issuance of the bonds. 5.02. Other than (i) expenditures to be paid or reimbursed from sources other than the Bonds, (ii) expenditures constituting preliminary expenditures within the meaning of Section 1.150-2(f)(2) of the Regulations, or (iii) expenditures in a “de minimus” amount (as defined in Section 1.150-2(f)(1) of the Regulations), no expenditures for the Infrastructure Improvements have been paid by the City before the date 60 days before the date of adoption of this Resolution. 5.03. The City reasonably expects that it may reimburse the expenditures made for Infrastructure Improvements out of the proceeds of Bonds in an estimated maximum aggregate principal amount of $3,599,178 after the date of payment of all or a portion of the costs of the Infrastructure Improvements. All reimbursed expenditures shall be capital expenditures, a cost of issuance of the bonds or other expenditures eligible for reimbursement under Section 1.150- 2(d)(3) of the Regulations. 123 Resolution 5420, Approving Projects in the South Bozeman Technology Tax Increment Financing District 6 5.04. As of the date hereof, there are no City funds reserved, allocated on a long-term basis or otherwise set aside (or reasonably expected to be reserved, allocated on a long-term basis or otherwise set aside) to provide permanent financing for the expenditures related to the Infrastructure Improvements, other than pursuant to the issuance of the Bonds. The statement of intent contained in this Resolution, therefore, is determined to be consistent with the City’s budgetary and financial circumstances as they exist or are reasonably foreseeable on the date hereof. 5.05. The City’s Finance Director shall be responsible for making the “reimbursement allocations” described in the Regulations, being generally the transfer of the appropriate amount of proceeds of the bonds to reimburse the source of temporary financing used by the City to make prior payment of the costs of the Infrastructure Improvements. Each allocation shall be evidenced by an entry on the official books and records of the City maintained for the Bonds or the Infrastructure Improvements and shall specifically identify the actual original expenditure being reimbursed. 124 Resolution 5420, Approving Projects in the South Bozeman Technology Tax Increment Financing District 7 PASSED, ADOPTED, AND APPROVED by the City Commission of the City of Bozeman, Montana, at a regular session thereof held on the 14th day of June, 2022. ___________________________________ CYNTHIA ANDRUS Mayor ATTEST: ___________________________________ MIKE MAAS City Clerk APPROVED AS TO FORM: ___________________________________ GREG SULLIVAN City Attorney 125 CERTIFICATE AS TO RESOLUTION AND ADOPTING VOTE I, the undersigned, being the duly qualified and acting recording officer of the City of Bozeman, Montana (the “City”), hereby certify that the attached resolution is a true copy of Resolution No. 5420 entitled: “RESOLUTION APPROVING CERTAIN PROJECTS IN THE SOUTH BOZEMAN TECHNOLOGY TAX INCREMENT FINANCING DISTRICT AS TECHNOLOGY INFRASTRUCTURE DEVELOPMENT PROJECTS AND USING TAX INCREMENT REVENUES OR TAX INCREMENT REVENUE BONDS TO REIMBURSE ELIGIBLE COSTS ASSOCIATED WITH SUCH PROJECTS; APPROVING A RELATED DEVELOPMENT AGREEMENT; AND MAKING A REIMBURSEMENT DECLARATION” (the “Resolution”), on file in the original records of the City in my legal custody; that the Resolution was duly adopted by the City Commission of the City at a regular meeting on June 14, 2022, and that the meeting was duly held by the City Commission and was attended throughout by a quorum, pursuant to call and notice of such meeting given as required by law; and that the Resolution has not as of the date hereof been amended or repealed. I further certify that, upon vote being taken on the Resolution at said meeting, the following Commission members voted in favor thereof: ; voted against the same: ; abstained from voting thereon: ; or were absent: . WITNESS my hand and seal officially this 14th day of June, 2022. (SEAL) __________________________________ MIKE MAAS City Clerk 126 Resolution 5420, Approving Projects in the South Bozeman Technology Tax Increment Financing District A-1 EXHIBIT A [Form of Development Agreement] 127 Memo To: David Fine, City of Bozeman From: Mikaela Huot, Director Date: June 1, 2022 Subject: Review of Request for Financial Assistance through Tax Increment Financing (TIF) District for MSUIC – Aurora and Industry Buildings Background The City of Bozeman received an application from Charter Realty and Development, the developer, for financial assistance through Tax Increment Financing (TIF) to assist with financing a portion of the extraordinary development costs related to the construction of two office buildings. One will be approximately 88,000 square foot industry building to support start-up companies and new ideas and the other will be approximately 87,000 square foot Aurora Technologies building that will follow Industry. The purpose of this memorandum is to provide a summary of Baker Tilly’s review of the development project costs and operating pro forma as provided by the developer to assist the City with making a determination if the project as proposed would be unlikely to proceed “but-for” the requested Tax Increment Financing (TIF) assistance, and to determine the appropriate amount, if any, of public assistance. Prior to providing financial assistance, there are findings that need to be made by the City that include: 1) determination that the project qualifies and 2) determination that the project as proposed would not proceed without public assistance (meeting the “but-for” test). It can also be beneficial to make a determination that the estimated market value created on the site with tax increment financing assistance is greater than what would be created without assistance. When reviewing requests for financial assistance it is important to understand how the level of financial assistance would impact the ability of the project to proceed as proposed and maximize new value created on the current project site. The developer provided an initial application for financial assistance and after a follow up conversation with the developer, provided additional details including financial projections for future cash flow performance to assist in the financial review. Developer Request for Assistance The developer’s application included an approximate $85 million project that will be funded through a combination of private debt and equity with requested TIF assistance of $4.0M to finance extraordinary costs of the project. Financial assistance through tax increment financing from the City of Bozeman has been requested to offset a portion of the eligible and extraordinary site development costs that are deemed necessary for the project to meet minimum equity and debt coverage requirements upon project stabilization. The developer’s request for assistance would be through City bonding for financing of the extraordinary redevelopment costs. There are generally significant costs associated with new office development projects and this project includes additional site preparation and improvements. Those extraordinary development costs that cannot be supported solely by the project alone typically may justify the need for some type of public financial assistance that would allow the project to proceed as proposed and meet debt coverage and value assumptions. The developer has indicated the receipt of City financial assistance is necessary for the project to proceed and the request for assistance ($4,000,000) is equal to approximately 4.7% of total project costs. The sources and uses from the developer’s application are illustrated below. 128 Development Budgets Aurora Project Costs Construction Hard Costs Total Shell / Site Work $22,862,453 Offsite Improvements 2,008,093 Charter TIA Contribution 3,916,850 Additional Tenant Work 15,667,400 Construction Contingency 2,487,055 Soft Costs A&E Contract - Design 809,900 A&E Contract - CA 206,200 MMI Contract – Aurora Site Plan 74,553 Owner’s Rep – Predev 95,000 Owner’s Rep – CA 360,000 Permitting / Permitting Legal 100,000 Legal – Leasing 120,000 Utilities, Taxes, G&A 50,000 Leasing Commissions 1,574,355 Soft Cost Contingency 339,001 Development Fee (excludes TI) 1,367,890 Closing Costs Partnership Legal 300,000 Title Insurance 100,000 Professional Fees - Closing 100,000 Total 52,538,740 Industry Project Costs Construction Hard Costs Vertical Improvements 22,314,487 Offsite Improvements 2,008,093 Soft Costs Vertical Improvements 6,665,878 Leasing Commissions 267,666 Closing Costs Partnership Legal 150,000 MSU Ground Lease Legal 50,000 Title Insurance 50,000 Professional Fees - Closing 50,000 Total 31,556,124 Total Investment both Buildings 84,094,864 Project Financing There are different ways in which financial public assistance can be provided for development projects and historically the City has provided assistance through the issuance of tax increment revenue bonds upon some or all of project completion (take-out financing). This method can reduce the risk of debt issuance of the City as the development being completed is the source of revenue for which the tax increments are generated to repay the debt service. Alternate financing approaches to be considered (and as further described) may include upfront (prior to project completion) and/or on a pay-as-you-go basis (developer financed and reimbursed over time with future increments). With take-out financing, the developer is responsible for financing all costs upfront through private investment (or other funding sources) and the City would reimburse a portion of those costs through bond issuance upon 129 completion of the project (or determined level of private investment made or development completed) to generate sufficient revenues for debt repayment. With upfront financing, the City would finance a portion of the developer’s initial project costs through the issuance of bonds or as an internal loan. This is generally done prior to construction commencement and used as a funding source when the developer is unable to obtain sufficient upfront funds to pay all project costs. In certain cases, not all project costs generate revenues and a development may experience a value gap, in which upfront funding is necessary to support all project costs. In this scenario, future tax increments generated by the new development would be collected by the City and used to pay debt service on City-issued bonds or repayment of an internal loan (subject to actual financing terms). With pay-as-you-go financing, the developer would finance all project costs upfront and would be reimbursed over time for a portion of those costs as revenues are available. Pay-as-you-go-financing is generally more acceptable than upfront financing for the City because it shifts the risk for repayment to the developer. If tax increment revenues are less than originally projected, the developer receives less and therefore bears the risk of not being reimbursed the full amount of their financing. However, in some cases pay as you go financing may not be financially feasible. With bonds, the City would still need to make debt service payments and would have to use other sources to fill any shortfall of tax increment revenues. With internal financing, the City reimburses the loan with future revenue collections and may risk not repaying itself in full if tax increment revenues are not sufficient. The developer’s financial information includes City assistance through bond financing to pay for a portion of the identified extraordinary site development costs necessary for development of the project. the financing structure would include City debt issuance following construction of both buildings as a means of supporting debt service repayment. Financing Assumptions The financing scenarios include a debt capacity matrix with variations to both interest rate and debt coverage assumptions. The interest rate variables reflect interest rate adjustments in anticipation of future market conditions and the debt coverage reflect the projected availability of revenues to repay debt service. Borrowing rates would be reflective of current market in this matrix.  Non-Rated TIF Scale Plus 150 bps  Solution: Level w/ 2yr ramp up in debt service  Project Amount: $4 Million  Requires 1.40x and 1.70x coverage o Revenues Shown as Required amount to support the bond coverage  Debt Service Reserve Fund: 10% Par, 100% Max DS, 125% Avg DS  Dated: 11/1/2023  First Coupon: 7/1/2024  Final Maturity: 7/1/2048 o 25-year term from the dated date Debt Coverage Annual Debt Service Annual Revenues Par Interest Total DS TIC 1.40x $395,000 $550,000 $4,553,000 $5,173,949 $9,726,949 7.22% 1.70x $395,000 $692,000 $4,553,000 $5,173,949 $9,726,949 7.22% The supporting bond schedules are attached to the memorandum. The assumption is that future tax increment revenues generated from the new office buildings would be the source of repayment for the bond debt service. Certain assumptions were used to estimate the projected available tax increment revenues to assist with understanding feasibility of the project to support debt repayment up to the full requested assistance amount of $4.0M. The market value of office buildings is typically estimated using one of three ways: 1) Income based using the projected net operating income of the project upon stabilization, 2) cost based assuming a replacement cost of the improvement, minus depreciation, plus the land value or 3) sales comparison based on similar properties which have recently sold. Commercial property is 130 typically valued using the income or cost approach for valuation, with income approach as preferred if relevant data exists. The cost approach is used to value unique properties or when an income model does not exist for a property's use type. The sales comparison approach is not as commonly used to value commercial property as a result of generally lacking comparable sales data. Assumptions were made relative to the income (lease rate) assumptions and construction cost estimates for the proposed project. Using the available information that has been provided and making some additional projections and assumptions, the table below illustrates a potential range of estimated valuations and corresponding revenues. We anticipate there may be adjustments as additional project details become available and building construction commences. Aurora Industry Total Total Estimated Construction Cost $46,941,851 $24,322,580 $71,264,431 Estimated Market Value (Income $15/SF) $31,788,963 $15,247,794 $47,036,757 Estimated Revenues $341,261 $163,688 $504,949 Estimated Market Value (Income $20/SF) $31,788,963 $20,330,392 $52,119,355 Estimated Revenues $341,261 $218,251 $559,512 Estimated Market Value (Cost 85%) $39,900,573 $20,674,193 $60,574,766 Estimated Revenues $428,341 $221,942 $650,282 Estimated Market Value (Cost 95%) $44,594,758 $23,106,451 $67,701,209 Estimated Revenues $478,734 $248,052 $726,786 Estimated Debt Service $395,000 Estimated Revenues with 1.40x DCR $550,000 Estimated Revenues with 1.70x DCR $692,000 Developer Pro forma Analysis including But-For Upon approval of a TIF project, the City must make several findings, including the “but for” test: that the proposed development would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future. The developer has stated the assistance is necessary due to the high costs of developing the site, that includes site improvement and infrastructure costs, along with the inability of the project to support those costs upon completion. The current estimated total development costs for both buildings ($84,094,864) are expected to be in excess of the estimated future taxable value of the buildings upon development. Based on the developer’s stated position relative to the need for tax increment financing assistance, the City could make its “but for” finding and provide tax increment assistance. We recommend, however, that the City also consider an appropriate level and type of TIF assistance for the project based on the information submitted by the developer. The City’s position relative to the use of tax increment has typically been to finance extraordinary costs and the level of assistance is in part dictated by the ‘extraordinary’ costs of the project. It is generally recommended good practice to focus on maintaining a limit to the amount of public assistance to a certain percentage of total development costs (less than 10%) and for financing of certain extraordinary costs. It is also recommended that projects are financially feasible, and the level of assistance provided can be supported by the projected incremental revenues of the project. The current request of $4,000,000 is approximately 4.7% and we anticipate would be financed by a 25-year bond. We understand that due to the developer (and City)’s desire and vision for development of the project site that there are some significant extraordinary costs to be incurred for the project to proceed. Not all those costs will equate to increased value to the developer, as represented by the total estimated assessed value. Following thorough evaluation of the project as provided allows the City to be prepared to make an informed “but-for” decision based on the likelihood of the project needing assistance, as well as the appropriate level of assistance. To complete this analysis, we reviewed the developer’s provided operating proforma and constructed similar ten-year project proformas, showing a result if the developer received the assistance and showing a result if the developer did not receive assistance. Our analysis of the proformas included a review of the development budget, projected operating revenues and expenditures, and the project’s capacity to support annual debt service on outstanding debt. The purpose of evaluating the operating proformas is to understand the potential returns to the developer through the initial development of the project and the operation of the enterprise over a 10-year period. 131 Generally, should the rates of return lie below a reasonable range without assistance; we could assume the project as proposed would not move forward without assistance. Should the returns lie within a reasonable range with the assistance, we could assume the amount of assistance tested is appropriate for the project. All such estimates should be viewed as general indicators of performance and not exact forecasts. The number of current and future variables affecting these estimates and actual results are great. There are no set rate of return benchmarks that dictates whether a project needs TIF assistance or not; however, there are market/industry standards for certain types of projects, as well as more specific investor/developer thresholds that need to be achieved. An additional measure of project feasibility is the Debt Coverage Ratio (DCR), which is a calculation detailing the ratio by which operating income exceeds the debt-service payments for the project. If the DCR is greater than 1.0 it indicates the project has operating income that is greater than the debt-service payment by some margin; conversely if the DCR is less than 1.0 it indicates the project is incapable of meeting its debt-service payment and would need to seek additional revenue sources in order to pay its debt. Typical lending standards will require a DCR of significantly greater than 1.0 as a measure of cushion in the event actual revenues and expenses are different than projected. The developer has not provided details regarding the financing options and the ultimate level of debt and equity for the project will be in part based on current market conditions and expected project performance to support debt repayment and meet minimum return thresholds. The purpose of the City’s TIF assistance is to provide an additional funding source to support total project costs and allow for reasonable return metrics following completion. Projects are financed through a combination of debt and equity. The level of debt and equity is based on projected performance and valuations of the project. Traditional metrics for determining a maximum level of debt that could be obtained for a project include loan to value, loan to cost and debt coverage ratios. Traditional metrics for determining a maximum level of equity may include cash-on-cash return, internal rate of return, and yield on cost. The developer has not yet determined what levels of debt and equity will be used to finance the project costs due to continued unknowns in the market regarding interest rates, costs, and other future variables. We have analyzed the request and subsequent need for financial assistance based on the metrics the developer has provided utilizing the yield on cost metric. The developer has provided a minimum return on cost threshold of 5 and 6.5%, respectively for the two individual buildings. Based on market data, these estimates are on the low range of reasonable and could justify the need for financial assistance. It is important to note that certain assumptions were made based on the developer’s provided information including the debt and equity amounts (estimates as the actual amounts are undecided), annual revenues, vacancy rates and annual revenue and operating expense inflators in order to analyze the projected returns to the developer and overall project performance. Adjustments to those assumptions may have a potential impact on the project performance and needed level of public assistance. The scenarios above are based on information provided by the developer regarding the annual operating assumptions for revenues and expenditures and assumptions for debt service payments. Based on the original assumptions, public assistance is necessary to meet the developer’s minimum return threshold of 5 and 6.5% that would allow the project to proceed. Information provided by the developer indicates that financial assistance to the project is expected to increase the projected rate of return to a level that would be considered feasible as represented by the developer and would allow the project to proceed. Ultimately, actual revenues and expenditures will impact the ultimate performance of the project. To understand viability of the project and test the necessary level of assistance, we also provided a sensitivity analysis to the proformas with adjustments made to the upfront sources and uses of funds and annual operating revenues and expenses. Increases in the projected lease rates or decreases in operating expenses are projected to result in similar returns and DCR calculations as would be through providing tax increment assistance. We understand based on information provided by the applicant that the projected rates are constant for this project. Additional conversations with the City and developer have indicated that it is not feasible to expect that rates could increase, or operating expenses decrease to levels that would eliminate the need for financial assistance. In addition, any increases in total development costs or operating expenses or decrease in revenues would be expected to have a negative impact on the cash flow performance. Conclusion The developer has requested financial assistance of approximately $4.0 million as related to development of the project site. Through the submission of the tax increment financing application and supporting financial 132 information, the developer has indicated that the project would not occur without financial assistance from the City due to those extraordinary costs. The with-assistance scenario illustrates that City financial assistance will have a positive impact on the project performance and projected to increase the rate of return to a level that is consistent with industry standards for similar type projects and necessary to attract the equity investors. Without assistance, the project is expected to have lower returns to the developer and are not expected to be sufficient to meet equity investor requirements. Discussions with the developer have resulted in a better understanding of the project financing components. The developer has indicated the projected rates are within market standards and not expected to increase significantly enough to reduce the need for public participation. Additional due diligence and financial feasibility analysis results in support of the developer’s financial information and need for public financial assistance. We understand the developer would be financing all project costs upfront and upon completion of the project and creation of taxable value to generate the tax increment revenues to repay debt service. As a result, we recommend the level of financial assistance be based on actual performance (taxable value and tax increment revenues) of the project and the financial assistance would be provided up to $4.0M (based on actual incurred costs). With this structure, the developer will receive up to the full requested amount subject to ability of the project to generate revenues necessary to support debt repayment with debt coverage the City needs. Due to district size and availability of revenues within the district, we recommend the City consider incorporating what may be considered a higher debt coverage ratio than other districts and projects (in the range of 1.4x – 1.7x) when determining feasibility of revenues to support the full requested amount. We have provided a range of financial feasibility scenarios based on different coverage and revenue assumptions. We anticipate the City will be in a position to consider providing assistance up to $4.0M for eligible project costs and meet the developer’s request, subject to availability of revenues to repay City debt service. 133 Preliminary as of 5/19/22 $4,553,000 City of Bozeman, Montana Tax Increment Urban Renewal Revenue Bonds, Series 2023 (Bozeman Technology District) - Office Building Project Scenario NET DEBT SERVICE SCHEDULE Date Principal Coupon Interest Total P+I DSR Net New D/S Revenue Surpls(Deficit) 07/01/2024 61,000.00 4.900%208,091.13 269,091.13 -269,091.13 376,727.59 107,636.46 07/01/2025 56,000.00 5.170%309,147.70 365,147.70 -365,147.70 511,206.78 146,059.08 07/01/2026 89,000.00 5.300%306,252.50 395,252.50 -395,252.50 553,353.50 158,101.00 07/01/2027 94,000.00 5.560%301,535.50 395,535.50 -395,535.50 553,749.70 158,214.20 07/01/2028 99,000.00 5.730%296,309.10 395,309.10 -395,309.10 553,432.74 158,123.64 07/01/2029 105,000.00 5.950%290,636.40 395,636.40 -395,636.40 553,890.96 158,254.56 07/01/2030 111,000.00 6.110%284,388.90 395,388.90 -395,388.90 553,544.46 158,155.56 07/01/2031 118,000.00 6.270%277,606.80 395,606.80 -395,606.80 553,849.52 158,242.72 07/01/2032 125,000.00 6.410%270,208.20 395,208.20 -395,208.20 553,291.48 158,083.28 07/01/2033 133,000.00 6.600%262,195.70 395,195.70 -395,195.70 553,273.98 158,078.28 07/01/2034 142,000.00 6.720%253,417.70 395,417.70 -395,417.70 553,584.78 158,167.08 07/01/2035 151,000.00 6.790%243,875.30 394,875.30 -394,875.30 552,825.42 157,950.12 07/01/2036 162,000.00 6.860%233,622.40 395,622.40 -395,622.40 553,871.36 158,248.96 07/01/2037 173,000.00 6.930%222,509.20 395,509.20 -395,509.20 553,712.88 158,203.68 07/01/2038 185,000.00 7.000%210,520.30 395,520.30 -395,520.30 553,728.42 158,208.12 07/01/2039 198,000.00 7.070%197,570.30 395,570.30 -395,570.30 553,798.42 158,228.12 07/01/2040 212,000.00 7.080%183,571.70 395,571.70 -395,571.70 553,800.38 158,228.68 07/01/2041 227,000.00 7.090%168,562.10 395,562.10 -395,562.10 553,786.94 158,224.84 07/01/2042 243,000.00 7.110%152,467.80 395,467.80 -395,467.80 553,654.92 158,187.12 07/01/2043 260,000.00 7.130%135,190.50 395,190.50 -395,190.50 553,266.70 158,076.20 07/01/2044 278,000.00 7.250%116,652.50 394,652.50 -394,652.50 552,513.50 157,861.00 07/01/2045 299,000.00 7.250%96,497.50 395,497.50 -395,497.50 553,696.50 158,199.00 07/01/2046 320,000.00 7.250%74,820.00 394,820.00 -394,820.00 552,748.00 157,928.00 07/01/2047 344,000.00 7.250%51,620.00 395,620.00 -395,620.00 553,868.00 158,248.00 07/01/2048 368,000.00 7.250%26,680.00 394,680.00 (395,636.40)(956.40)552,552.00 553,508.40 Total $4,553,000.00 -$5,173,949.23 $9,726,949.23 (395,636.40)$9,331,312.83 $13,617,728.93 $4,286,416.10 SIGNIFICANT DATES Dated...................................................................................................................................................................................................11/01/2023 Delivery Date...........................................................................................................................................................................................11/01/2023 First Coupon Date.......................................................................................................................................................................................7/01/2024 Yield Statistics Bond Year Dollars.......................................................................................................................................................................................$73,183.33 Average Life............................................................................................................................................................................................16.074 Years Average Coupon..........................................................................................................................................................................................7.0698464% Net Interest Cost (NIC).................................................................................................................................................................................7.1818309% True Interest Cost (TIC)................................................................................................................................................................................7.2219629% Bond Yield for Arbitrage Purposes.......................................................................................................................................................................7.0199804% All Inclusive Cost (AIC)................................................................................................................................................................................7.4119594% Net Interest Cost in Dollars............................................................................................................................................................................5,173,949.23 Weighted Average Maturity...............................................................................................................................................................................16.074 Years 134 Preliminary as of 5/19/22 $4,553,000 City of Bozeman, Montana Tax Increment Urban Renewal Revenue Bonds, Series 2023 (Bozeman Technology District) - Office Building Project Scenario NET DEBT SERVICE SCHEDULE Date Principal Coupon Interest Total P+I DSR Net New D/S Revenue Surpls(Deficit) 07/01/2024 61,000.00 4.900%208,091.13 269,091.13 -269,091.13 470,909.49 201,818.36 07/01/2025 56,000.00 5.170%309,147.70 365,147.70 -365,147.70 639,008.48 273,860.78 07/01/2026 89,000.00 5.300%306,252.50 395,252.50 -395,252.50 691,691.88 296,439.38 07/01/2027 94,000.00 5.560%301,535.50 395,535.50 -395,535.50 692,187.13 296,651.63 07/01/2028 99,000.00 5.730%296,309.10 395,309.10 -395,309.10 691,790.93 296,481.83 07/01/2029 105,000.00 5.950%290,636.40 395,636.40 -395,636.40 692,363.70 296,727.30 07/01/2030 111,000.00 6.110%284,388.90 395,388.90 -395,388.90 691,930.58 296,541.68 07/01/2031 118,000.00 6.270%277,606.80 395,606.80 -395,606.80 692,311.90 296,705.10 07/01/2032 125,000.00 6.410%270,208.20 395,208.20 -395,208.20 691,614.35 296,406.15 07/01/2033 133,000.00 6.600%262,195.70 395,195.70 -395,195.70 691,592.48 296,396.78 07/01/2034 142,000.00 6.720%253,417.70 395,417.70 -395,417.70 691,980.98 296,563.28 07/01/2035 151,000.00 6.790%243,875.30 394,875.30 -394,875.30 691,031.78 296,156.48 07/01/2036 162,000.00 6.860%233,622.40 395,622.40 -395,622.40 692,339.20 296,716.80 07/01/2037 173,000.00 6.930%222,509.20 395,509.20 -395,509.20 692,141.10 296,631.90 07/01/2038 185,000.00 7.000%210,520.30 395,520.30 -395,520.30 692,160.53 296,640.23 07/01/2039 198,000.00 7.070%197,570.30 395,570.30 -395,570.30 692,248.03 296,677.73 07/01/2040 212,000.00 7.080%183,571.70 395,571.70 -395,571.70 692,250.48 296,678.78 07/01/2041 227,000.00 7.090%168,562.10 395,562.10 -395,562.10 692,233.68 296,671.58 07/01/2042 243,000.00 7.110%152,467.80 395,467.80 -395,467.80 692,068.65 296,600.85 07/01/2043 260,000.00 7.130%135,190.50 395,190.50 -395,190.50 691,583.38 296,392.88 07/01/2044 278,000.00 7.250%116,652.50 394,652.50 -394,652.50 690,641.88 295,989.38 07/01/2045 299,000.00 7.250%96,497.50 395,497.50 -395,497.50 692,120.63 296,623.13 07/01/2046 320,000.00 7.250%74,820.00 394,820.00 -394,820.00 690,935.00 296,115.00 07/01/2047 344,000.00 7.250%51,620.00 395,620.00 -395,620.00 692,335.00 296,715.00 07/01/2048 368,000.00 7.250%26,680.00 394,680.00 (395,636.40)(956.40)690,690.00 691,646.40 Total $4,553,000.00 -$5,173,949.23 $9,726,949.23 (395,636.40)$9,331,312.83 $17,022,161.24 $7,690,848.41 SIGNIFICANT DATES Dated...................................................................................................................................................................................................11/01/2023 Delivery Date...........................................................................................................................................................................................11/01/2023 First Coupon Date.......................................................................................................................................................................................7/01/2024 Yield Statistics Bond Year Dollars.......................................................................................................................................................................................$73,183.33 Average Life............................................................................................................................................................................................16.074 Years Average Coupon..........................................................................................................................................................................................7.0698464% Net Interest Cost (NIC).................................................................................................................................................................................7.1818309% True Interest Cost (TIC)................................................................................................................................................................................7.2219629% Bond Yield for Arbitrage Purposes.......................................................................................................................................................................7.0199804% All Inclusive Cost (AIC)................................................................................................................................................................................7.4119594% Net Interest Cost in Dollars............................................................................................................................................................................5,173,949.23 Weighted Average Maturity...............................................................................................................................................................................16.074 Years 135 Preliminary as of 5/19/22 $4,553,000 City of Bozeman, Montana Tax Increment Urban Renewal Revenue Bonds, Series 2023 (Bozeman Technology District) - Office Building Project Scenario New Money Sensitivity Date - 1.50 bps - 1.25 bps - 1.00 bps - 0.75 bps - 0.50 bps - 0.25 bps Net D/S + 0.25 bps + 0.50 bps + 0.75 bps + 1.00 bps + 1.25 bps + 1.50 bps 07/01/2024 219,263.07 227,328.93 235,420.40 243,537.80 251,674.73 260,889.73 269,091.13 277,370.07 286,659.73 295,016.87 304,348.73 312,760.73 322,177.40 07/01/2025 304,854.60 314,803.40 324,790.60 334,816.70 344,872.10 354,998.10 365,147.70 376,413.60 386,641.60 397,022.30 408,306.10 418,766.60 430,170.10 07/01/2026 340,359.00 349,216.20 358,121.80 367,076.30 377,070.10 386,144.50 395,252.50 404,432.60 414,636.50 424,003.10 434,221.10 444,685.00 454,035.20 07/01/2027 340,331.00 349,044.70 358,821.80 367,662.80 376,510.10 385,498.50 395,535.50 404,659.60 414,764.50 424,102.60 434,244.10 444,641.50 454,003.20 07/01/2028 340,865.00 349,433.00 358,033.80 367,756.60 376,500.70 386,400.90 395,309.10 405,372.50 414,371.10 424,676.00 434,733.70 444,057.30 454,425.80 07/01/2029 341,000.50 349,415.40 358,878.10 367,428.00 377,061.50 385,811.30 395,636.40 404,571.90 414,514.90 424,714.40 434,676.70 443,984.70 454,280.30 07/01/2030 340,660.50 349,916.40 358,185.60 367,604.00 377,066.50 385,712.30 395,388.90 405,247.90 414,064.90 424,148.40 434,004.70 444,288.70 454,500.80 07/01/2031 340,898.00 349,938.60 358,053.60 367,279.20 376,558.90 386,090.50 395,606.80 405,315.50 415,058.30 424,014.00 433,752.50 443,928.70 454,043.00 07/01/2032 340,649.30 349,462.80 358,413.40 367,434.40 376,519.50 385,866.50 395,208.20 404,752.30 414,340.50 424,221.80 433,828.20 443,882.30 454,884.50 07/01/2033 340,922.60 349,496.80 358,218.10 367,019.80 376,895.60 386,043.30 395,195.70 404,560.50 414,979.40 424,701.40 434,158.50 444,073.30 454,867.10 07/01/2034 340,578.60 349,899.80 358,378.10 367,946.80 376,538.60 385,470.80 395,417.70 404,587.00 414,749.40 424,293.40 434,582.50 444,339.30 453,904.1007/01/2035 340,696.40 349,694.80 358,912.50 367,170.90 376,519.60 386,218.70 394,875.30 404,829.00 414,713.60 424,059.50 434,083.30 444,659.50 454,053.70 07/01/2036 341,285.30 348,941.60 358,822.20 367,808.90 376,833.00 386,212.50 395,622.40 405,269.00 414,851.50 424,975.70 433,709.90 444,001.50 454,199.00 07/01/2037 340,280.50 349,629.00 358,094.60 367,727.40 376,402.60 386,438.20 395,509.20 404,821.90 414,075.50 424,875.80 434,369.70 444,349.90 454,241.00 07/01/2038 340,723.70 349,632.20 358,717.10 367,912.40 376,214.40 385,815.00 395,520.30 405,472.30 414,370.20 424,743.00 433,888.70 444,525.70 454,078.60 07/01/2039 340,493.70 349,937.20 358,557.10 367,287.40 376,189.40 386,327.50 395,570.30 405,059.80 414,570.20 424,483.00 434,248.70 444,428.20 454,608.60 07/01/2040 340,576.50 349,471.80 358,599.20 367,837.00 376,246.50 385,823.90 395,571.70 404,566.20 414,581.60 424,999.40 434,270.10 443,954.60 454,640.00 07/01/2041 341,025.90 349,345.40 358,892.00 367,544.00 376,428.50 386,412.60 395,562.10 405,026.60 414,436.20 424,243.20 433,978.90 444,128.40 454,193.00 07/01/2042 340,783.80 349,497.40 358,372.20 367,405.80 376,666.90 385,954.20 395,467.80 405,291.40 414,055.10 424,211.20 434,291.00 444,779.60 454,178.30 07/01/2043 340,824.70 349,843.60 358,013.70 367,332.60 376,869.00 385,421.60 395,190.50 405,259.40 414,334.50 424,718.40 434,016.00 444,712.40 454,395.00 07/01/2044 341,087.50 349,320.00 358,750.00 367,255.00 376,962.50 385,740.00 394,652.50 404,850.00 414,115.00 424,600.00 434,065.00 443,835.00 454,662.5007/01/2045 340,252.50 349,660.00 358,187.50 367,835.00 376,602.50 385,490.00 395,497.50 404,700.00 415,027.50 424,480.00 433,975.00 444,760.00 454,500.00 07/01/2046 340,612.50 349,040.00 358,625.00 367,245.00 377,027.50 385,910.00 394,820.00 404,975.00 414,157.50 424,520.00 433,905.00 444,475.00 454,062.50 07/01/2047 341,052.50 349,460.00 358,937.50 367,485.00 376,102.50 385,860.00 395,620.00 404,525.00 414,505.00 424,560.00 434,690.00 443,895.00 454,175.00 07/01/2048 (770.30)(138.60)(875.00)(521.80)(242.60)(168.20)(956.40)(197.30)(220.80)(559.40)(651.20)-(309.50) Total $8,019,307.37 $8,231,290.43 $8,445,920.90 $8,662,887.00 $8,882,090.63 $9,106,382.43 $9,331,312.83 $9,561,731.77 $9,792,353.43 $10,029,824.07 $10,263,696.93 $10,505,912.93 $10,746,969.20 Summary Statistics Deposit to Project Construction Fund....................................................................................................................................................................4,000,000.00 PAR - 1.50 bps..............................................................................................................................................................................................4,498,000.00 - 1.25 bps..............................................................................................................................................................................................4,507,000.00 - 1.00 bps..............................................................................................................................................................................................4,516,000.00 - 0.75 bps..............................................................................................................................................................................................4,525,000.00 - 0.50 bps..............................................................................................................................................................................................4,534,000.00- 0.25 bps..............................................................................................................................................................................................4,544,000.00 Base Case...............................................................................................................................................................................................4,553,000.00 + 0.25 bps..............................................................................................................................................................................................4,563,000.00 + 0.50 bps..............................................................................................................................................................................................4,573,000.00 + 0.75 bps..............................................................................................................................................................................................4,583,000.00 + 1.00 bps..............................................................................................................................................................................................4,593,000.00 + 1.25 bps..............................................................................................................................................................................................4,603,000.00 + 1.50 bps..............................................................................................................................................................................................4,613,000.00 TIC - 1.50 bps..............................................................................................................................................................................................5.6909029% - 1.25 bps..............................................................................................................................................................................................5.9460630% - 1.00 bps..............................................................................................................................................................................................6.2013024% - 0.75 bps..............................................................................................................................................................................................6.4564242% - 0.50 bps..............................................................................................................................................................................................6.7115186% - 0.25 bps..............................................................................................................................................................................................6.9668180% Base Case...............................................................................................................................................................................................7.2219629% + 0.25 bps..............................................................................................................................................................................................7.4772921% + 0.50 bps..............................................................................................................................................................................................7.7324533% + 0.75 bps..............................................................................................................................................................................................7.9878976% + 1.00 bps..............................................................................................................................................................................................8.2429262% + 1.25 bps..............................................................................................................................................................................................8.4983458% + 1.50 bps..............................................................................................................................................................................................8.7535463% 136 DEVELOPMENT AGREEMENT (MSU Innovation Campus Project) This DEVELOPMENT AGREEMENT (this “Agreement”) is dated as of [______________], 2022 by and between Big Sky ICINF, LLC (the “Developer”), and the CITY OF BOZEMAN, MONTANA (the “City”). The Developer and the City are each individually referred to herein as a “Party” and collectively as the “Parties.” RECITALS: WHEREAS, under the provisions of Montana Code Annotated, Title 7, Chapter 15, Parts 42 and 43, as in effect on December 31, 2012 (the “Technology District Act”), the City was authorized to create technology districts for the purpose of encouraging the location and development of technology infrastructure development projects in the State of Montana (the “State”), to provide for the segregation and collection of tax increment with respect to property taxes collected in such technology districts, and to apply tax increment revenues derived from projects undertaken within the technology district to pay eligible costs; WHEREAS, pursuant to the Technology District Act and Ordinance No. 1844 adopted by the City Commission of the City (the “City Commission”) on December 19, 2012 (the “Ordinance”), the City has created the South Bozeman Technology Tax Increment Financing District (the “District”) as a technology district under the Technology District Act. By Resolution No. 4414, adopted by the City Commission on November 5, 2012, the City Commission has adopted the South Bozeman Technology District Comprehensive Development Plan (the “Plan”) as a comprehensive development plan that ensures that the District can host a diversified tenant base of multiple independent tenants, in accordance with the Technology District Act. The Plan provides for the segregation and collection of tax increment revenues with respect to the District; WHEREAS, Big Sky QF, LLC, a Delaware limited liability company (“BSQ”), has leased approximately 4.87 acres of land located in the District from Montana State University Innovation Campus, a Montana non-profit corporation (“MSUIC”), pursuant to that certain Ground Lease dated May 26, 2022, and has subleased such land (the “Industry Land”) to Industry Bozeman Property, LLC, a Montana limited liability company (“IBP”) on May 26, 2022. IBP proposes to undertake the construction on the Industry Land of an approximately 86,000 square foot building to be used as flexible commercial workspace, to include 61,000 square feet of offices and 25,000 square feet of indoor common space, as well as related site improvements and related improvements (the “INDUSTRY Project”); and WHEREAS, BIG SKY AURORA, LLC, a Delaware limited liability company (“BSA”) has leased approximately 4.80 acres of land located in the District from MSUIC pursuant to that certain Ground Lease dated February 17, 2022, and has subleased such land (the “Aurora Land”) to Aurora Operations, Inc., a Delaware corporation (“AOI”) on February 17, 2022. BSA proposes to undertake the construction on the Aurora Land of an approximately 78,000 square foot building to be leased to AOI for use as office space, research and design activities and potentially manufacturing, as well as related site improvements (the “Aurora Project” and, together with the INDUSTRY Project, the “Projects”); 137 2 WHEREAS, in furtherance of the Projects, BSQ and BSA propose to undertake the construction of certain infrastructure improvements described on Exhibit C attached hereto (as further defined below, the “Infrastructure Improvements”); WHEREAS, the Developer, BSQ and BSA are affiliated entities; WHEREAS, the Industry Land and the Aurora Land are collectively legally described on Exhibit B hereto (collectively, the “Land”); WHEREAS, pursuant to Resolution No. 5420 adopted on June 14, 2022, after a duly called and noticed public hearing, the City Commission approved the Projects under the Plan and the Technology District Act and authorized the use of tax increment revenue of the District to reimburse the Developer for certain eligible costs of the Infrastructure Improvements in the maximum amount of the Reimbursable Amount (as hereinafter defined), subject to the terms and conditions of this Agreement; and WHEREAS, the City Commission may determine in its sole discretion to issue tax increment revenue bonds in one or more series (the “Bonds”) to finance all or a portion of the costs of the Infrastructure Improvements to be reimbursed to the Developer and pay associated costs of the financing and fund a deposit to a debt service reserve account, if desirable; and WHEREAS, the Parties desire to enter into this Agreement which sets forth the obligations and commitments of the Parties with respect to the Infrastructure Improvements. NOW, THEREFORE, the City and the Developer, pursuant to the Technology District Act, each in consideration of the representations, covenants and agreements of the other, as set forth herein, mutually represent, covenant and agree as follows: Section 1.Definitions; Rules of Interpretation; Exhibits. 1.1.Definitions. For all purposes of this Agreement, except as otherwise expressly provided or unless the context clearly requires otherwise, the following terms have the meanings assigned to them, respectively: “Affiliated Entities” means BSQ and BSA, as affiliates of the Developer. “Agreement” means this Development Agreement, dated as of _____________, 2022, by and between the City and the Developer, as it may be amended or supplemented from time to time in accordance with the terms hereof. “Aurora Land” has the meaning given in the Recitals above. “Aurora Project” has the meaning given in the Recitals above. “Bonds” has the meaning given in the Recitals above. “BSA” means BIG SKY AURORA, LLC, a Delaware limited liability company, and its successors and assigns. 138 3 “BSQ” means Big Sky QF, LLC, a Delaware limited liability company, and its successors and assigns. “City” means the City of Bozeman, Montana, or any successors to its functions under this Agreement. “City Commission” means the governing body of the City. “Costs of Issuance” means, if the City issues Bonds, the following costs but only to the extent incurred in connection with, and allocable to the Bonds: underwriter’s spread, counsel fees, financial advisor fees, rating agency fees, trustee fees, paying agent fees, bond registrar, certificate, and authentication fees, accounting fees, printing costs for bonds and offering documents, public approval process costs, feasibility study costs, guarantee fees, and similar costs. “Coverage Requirement” has the meaning given to it in Section 5.2(a)(ii). “Developer” means Big Sky ICINF, LLC, a Delaware limited liability company, and its successors and assigns in accordance with and as permitted under this Agreement. “District” means the South Bozeman Technology Tax Increment Financing District, a technology district created by the Ordinance pursuant to the Technology District Act. “DOR” means the State of Montana Department of Revenue. “Environmental Laws and Regulations” means and includes the Federal Comprehensive Environmental Compensation Response and Liability Act (“CERCLA” or the “Federal Superfund Act”) as amended by the Superfund Amendments and Reauthorization Act of 1986 (“SARA”), 42 U.S.C. §§ 9601 et seq.; the Federal Resource Conservation and Recovery Act of 1976 (“RCRA”), 42 U.S.C. §§ 6901 et seq.; the Clean Water Act, 33 U.S.C. § 1321 et seq.; and the Clean Air Act, 42 U.S.C. §§ 7401 et seq., all as the same may be from time to time amended, and any other federal, state, county, municipal, local or other statute, code, law, ordinance, regulation, requirement or rule which may relate to or deal with human health or the environment including without limitation all land use, zoning, and stormwater control regulations as well as all regulations promulgated by a regulatory body pursuant to any statute, code, law, ordinance, regulation, requirement or rule. “Fiscal Year” means the period commencing on the first day of July of any year and ending on the last day of June of the next calendar year, or any other twelve-month period authorized by law and specified by the Commission as the City’s fiscal year. “Indemnified Parties” has the meaning given to it in Section 7.1. “Industry Land” has the meaning given in the Recitals above. “INDUSTRY Project” has the meaning given in the Recitals above. 139 4 “Infrastructure Improvements” means the design, engineering, work, construction, materials, equipment, and the other improvements, the costs of which are described as such in Exhibit C hereto, as the same may be amended or supplemented from time to time, in accordance with the terms hereof. “Land” has the meaning given in the Recitals above. “Land Use Regulations” means all federal, state and local laws, rules, regulations, ordinances and plans relating to or governing the development or use of the Land or the Projects. “Milestone” of “Milestones” has the meaning given in Section 3.4 hereof. “Milestone Date” or “Milestone Dates” has the meaning given in Section 3.4 hereof. “Ordinance” has the meaning given in the Recitals above. “Person” means any individual, corporation, limited liability company, partnership, limited liability partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. “Prevailing Wage Rates” means the Montana Prevailing Wage Rate for public works projects as published from time to time by and available from the Montana Department of Labor and Industry, Research and Analysis Bureau, P.O. Box 1728, Helena, Montana 59624, telephone number (800) 541-3904. “Projects” has the meaning given in the Recitals above. “Reimbursable Amount” means the least of: (i) $3,599,178; (ii) the actual cost of the Infrastructure Improvements; or (iii) if the Bonds are issued, the proceeds of the Bonds, less proceeds of the Bonds used to pay Costs of Issuance and, if desirable, to fund a debt service reserve account; recognizing that the Bonds must meet the Coverage Ratio determined as described in Section 5.2(a)(ii). “State” means the State of Montana. “Tax Increment” means the amount received by the City pursuant to the Technology District Act from the extension of levies of Taxes (expressed in mills) against the incremental taxable value (as defined in the Technology District Act) of all Taxable Property, and shall include all payments in lieu of Taxes attributable to the incremental taxable value and all payments received by the City designated as replacement revenues for lost Tax Increment. “Taxable Property” means all real and personal property located in the District and subject to Taxes, including land, improvements and equipment. “Taxes” means all taxes levied on an ad valorem basis by any Taxing Body against the Taxable Property (exclusive of the six mill levy for university purposes levied by the State), and shall include all payments in lieu of taxes received by the City with respect to Taxable Property. 140 5 “Taxing Body” means the City; the County of Gallatin, Montana; High School District No. 7 (Bozeman), Gallatin County, Montana; Elementary School District No. 7 (Bozeman), Gallatin County, Montana; the State; and any other political subdivision or governmental unit that levies or may hereafter levy or cause to be levied Taxes against property within the District. “Technology District Act” means Montana Code Annotated, Title 7, Chapter 15, Parts 42 and 43, as in effect on December 31, 2012. “Unavoidable Delay” means a delay resulting from a cause over which the Party required to perform does not have control and which cannot or could not have been avoided by the exercise of reasonable care, including but not limited to, acts of God, accidents, war, civil unrest, embargoes, strikes, unavailability of raw materials or manufactured goods, litigation, pandemics, epidemics, labor shortages, unusually inclement weather and the delays of the other Party or its contractors, agents or employees in the performance of their duties under or incident to this Agreement. 1.2.Rules of Interpretation. (a) The words “herein,” “hereof” and words of similar import, without reference to any particular section or subdivision, refer to this Agreement as a whole rather than to any of its particular sections or subdivisions. (b) References to any particular section or subdivision hereof are to the section or subdivision of this Agreement in its original signed form, unless otherwise indicated. (c) The word “or” is not exclusive but is intended to contemplate or encompass one, more or all of the alternatives conjoined. 1.3.Exhibits. The following Exhibits are attached to and by reference made a part of this Agreement: Exhibit A: Project Costs Exhibit B: Description of the Land Exhibit C: Costs of the Infrastructure Improvements Exhibit D: Milestones Exhibit E: Form of Developer Certificate Regarding Costs of the Infrastructure Improvements Exhibit F: City’s Nondiscrimination and Equal Pay Affirmation Exhibit G: Form of Developer’s Annual Certification Section 2.Representations. 2.1.City Representations. The City hereby represents as follows: 141 6 (a)Pursuant to the Technology District Act, and after a public hearing duly called and held, the City by the Ordinance has duly created the District. (b)Pursuant to Resolution No. 5420 of the City Commission, the City approved the use of Tax Increment, if available, to reimburse the Costs of the Infrastructure Improvements in a total amount not to exceed the Reimbursable Amount. Subject to the terms and conditions of this Agreement, the City intends to reimburse the Developer for the Costs of the Infrastructure Improvements in an amount not to exceed the Reimbursable Amount. (c)The DOR has advised the City that the base taxable value (as defined in the Technology District Act) of the District is $417. (d)The City Commission has duly authorized the execution and delivery of this Agreement. (e)The City’s Director of Economic Development is authorized to act on behalf of the City with respect to implementation of this Agreement, recognizing that certain events or circumstances arising under this Agreement will require City Commission consideration and action, including, without limitation, issuance of the Bonds. (f)The tax increment financing provision of the District terminates upon the later of the 15th year following its adoption (December 12, 2012) or payment or provision for payment in full or discharge of all bonds to which the Tax Increment is pledged. There are currently no bonds outstanding to which the Tax Increment is pledged. 2.2.Developer Representations. The Developer hereby represents as follows: (a)Each of the Developer, BSQ and BSA is a Delaware limited liability company, duly formed, validly existing and in good standing under the laws of the State of Delaware and duly qualified to do business in the State of Montana. The Developer has the power to enter into this Agreement and by all necessary corporate action has duly authorized the execution and delivery of this Agreement. (b)BSQ has sufficient right, title and interest in the Industry Land to allow BSQ to construct the applicable Infrastructure Improvements on or adjacent to the Industry Land, and BSA has sufficient right, title and interest in the Aurora Land to allow BSA to construct the Aurora Project thereon and the applicable Infrastructure Improvements on or adjacent to the Aurora Land. (c)The Developer and/or BSQ and/or BSA collectively have the financial capability or commitments to complete the Infrastructure Improvements at an approximate cost of $3,599,178. BSA has the financial capability or commitments to complete the Aurora Project and, to the best of the Developer’s knowledge, IBP has the financial capability or commitments to complete the INDUSTRY Project. The Projects are estimated to cost an aggregate $85,000,000 to complete. (d)The Projects are suitable to host a diversified tenant base of multiple, independent tenants. The Developer acknowledges that the Technology District Act provides that tenants of 142 7 the District must be engaged in technology-based operations within Montana that, through the employment of knowledge or labor, add value to a product, process, or export service that results in the creation of new wealth and for which at least 50% of the sales of the business or organization occur outside of Montana or the business or organization is a manufacturing company with at least 50% of its sales to other Montana companies that have 50% of their sales occurring outside of Montana. As set forth in Section 3.13, to the best of its ability, the Developer will cause the Projects to be operated to meet these requirements. (e)The Developer is not aware of any facts the existence of which would cause the Developer or the Affiliated Entities to be in violation in any material respect of any Environmental Laws and Regulations applicable to the Projects or the Infrastructure Improvements. None of the Developer nor the Affiliated Entities has not received from any local, state or federal official any notice or communication indicating that the development activities of the Developer or the Affiliated Entities have been, may be or will be in violation of any Environmental Laws and Regulations applicable to the Projects or the Infrastructure Improvements. (f)Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions hereof is prohibited or limited by, conflicts with or results in a breach of the terms, conditions or provisions of the certificate of formation, partnership agreement or operating agreement of the Developer or the Affiliated or any evidence of indebtedness, agreement or instrument of whatever nature to which the Developer is now a party or by which it is bound, or constitutes a default under any of the foregoing. (g)There is no action, suit, investigation or proceeding now pending or, to the knowledge of the Developer, threatened against or affecting the Developer, the Affiliated Entities or their respective businesses, operations, properties or condition (financial or otherwise) before or by any governmental department, commission, board, authority or agency, or any court, arbitrator, mediator or grand jury, that could, individually or in the aggregate, materially and adversely affect the ability of the Developer or the Affiliated Entities to perform under this Agreement. (h)The Developer acknowledges and agrees that the sole source of funds for reimbursing the Developer under this Agreement is Tax Increment and/or proceeds of the Bonds, which would be paid from Tax Increment. The Developer further acknowledges and agrees the amount of Tax Increment is dependent upon a number of variables, including, without limitation, the taxable value of the Projects, the number of mills levied by Taxing Bodies, and then- prevailing state laws regarding computation of Tax Increment. The Developer agrees that if Tax Increment in the amount of $3,599,178 is not available to the City to reimburse the Developer and/or, if the City, in its sole discretion, determines that it cannot reasonably sell the Bonds, whether due to lack of Tax Increment, market conditions, or otherwise, the City shall have no obligation to pay to the Developer the Reimbursable Amount described in Section 4. The Developer agrees that such event shall not constitute a default by the City hereunder. (i)The Developer currently estimates that, beginning in tax year 2025 (fiscal year ending June 30, 2026), the completed Projects are expected to generate tax revenues in the 143 8 approximate amount of $800,000 annually. The Developer acknowledges and agrees that the estimates of assessed (market) and taxable values set forth in this Agreement (and any resulting estimates of Tax Increment) are estimates only and are based on information provided by the Developer to the City and various assumptions. Actual assessed (market) and taxable values of the Projects and actual Tax Increment generated by the Projects or in the District may vary significantly based on variables over which the City has no control. (j)The Developer acknowledges and agrees that the Bonds, if authorized and issued, are special, limited obligations of the City and shall not be paid from any funds of the City other than Tax Increment. The Developer understands and agrees the Bonds, if authorized and issued, will be subject to all the terms and conditions of the bond resolution authorizing their issuance (the “Bond Resolution”). The Developer acknowledges and agrees that an event of default or default under the Bonds or the Bond Resolution does not constitute a default under this Agreement, unless the event of default or default is a result of the failure by the Developer to perform an obligation of the Developer identified in the Bond Resolution. Section 3.Developer Undertakings. 3.1.Construction and Maintenance of Projects. The Developer hereby agrees and commits to the City that it will diligently prosecute or cause to be prosecuted to completion the construction of the Projects in accordance with this Agreement, the site plan submitted to the City and all applicable federal, State and local laws, rules, regulations, ordinances and plans relating to or governing the development or use of the Projects, including applicable Land Use Regulations and Environmental Laws and Regulations. The Developer agrees and commits to the City that construction of the Projects and Infrastructure Improvements shall be substantially complete by October 1, 2025, subject to Unavoidable Delays. The projected costs of the Projects and Infrastructure Improvements are shown on Exhibit A hereto. At all times during the term of this Agreement, the Developer will operate and maintain, preserve and keep the Projects or cause the Projects to be operated, maintained, preserved and kept for the purposes for which each was constructed, and with the appurtenances and every part and parcel thereof in good repair and condition. Upon twenty-four (24) hours prior written notice, the Developer agrees to permit the City and any of its officers, employees or agents access to the Land for the purpose of inspection of all work being performed in connection with the Projects and Infrastructure Improvements; provided, however, that the City shall have no obligation to inspect such work. 3.2.Preparation, Review and Approval of Construction Plans. In connection with the Projects and Infrastructure Improvements, the Developer shall prepare and submit or shall cause the Affiliated Entities to prepare and submit, in each case, at its sole expense, construction plans, drawings, and related documents for each portion of each of the Projects and the Infrastructure Improvements to the appropriate City officials for architectural, engineering or land use review and written approval or permits. The Developer acknowledges that no review or approval by City officials hereunder may be in any way construed by the Developer to replace, override or be in lieu of any required review, inspection, or approval by the City or any other building construction official review or approvals required by any State laws or local ordinances or regulations. Nothing contained in this Agreement indicates or evidences that the City has approved or will approve either of the Projects, the Infrastructure Improvements, or any portion thereof. This Agreement does not affect or limit the City’s regulatory powers with regard to the 144 9 Projects or the Infrastructure Improvements, including, without limitation, those relating to building permits or other permits or the payment of fees. As further described in Section 7.1, the City shall have no liability and the Developer shall hold the City harmless with respect to any increases in costs of the Projects or the Infrastructure Improvements related to or arising out of delays resulting from the City’s regulatory actions or approvals. 3.3.Construction of the Infrastructure Improvements. The Developer shall acquire, install, construct or otherwise provide the Infrastructure Improvements, or shall cause the Affiliated Entities to do so. The Developer acknowledges and agrees that the City is not responsible for acquiring, installing, constructing or otherwise providing the Infrastructure Improvements. The estimated costs of the Infrastructure Improvements are shown on Exhibit C hereto. 3.4.Milestones of the Projects and Infrastructure Improvements. Certain steps in the development of the Projects and Infrastructure Improvements are listed on Exhibit D attached hereto (collectively, the “Milestones”; each a “Milestone”), together with the dates by which the Developer is obligated to complete the Milestones (collectively, the “Milestone Dates”; each as it relates to a particular Milestone, the “Milestone Date”). The Developer acknowledges and agrees that the City in reserving or offering to make available Tax Increment to reimburse the Developer for the costs of the Infrastructure Improvements (up to the Reimbursable Amount) necessarily means that certain Tax Increment is not available reimburse other undertakings or costs for the benefit of the District and that the City reasonably expects additional Tax Increment as a result of completion of each of the Projects. The Developer acknowledges and agrees that conditioning the availability of Tax Increment or proceeds of Bonds to reimburse the Developer for the costs of the Infrastructure Improvements on completion or satisfaction of the Milestones by the corresponding Milestone Dates is reasonable. If a Milestone cannot be completed or satisfied by the corresponding Milestone Date, the Developer shall make a formal written request to the Director of Economic Development, with appropriate supporting material, to extend the Milestone Date and, as appropriate, subsequent Milestone Dates. The Director of Economic Development may, in his or her sole discretion, (i) determine whether such extension is appropriate and, if so, fix a new and superseding Milestone Date and also adjust other subsequent Milestone Dates, along with any other terms or conditions, or (ii) refer the request to the City Commission to either approve the extension and adjust other Milestone Dates, as appropriate, or, in its sole discretion, terminate this Agreement, in which case the City will have no obligation to reimburse the Developer hereunder. 3.5.Prevailing Wage Rates; Competitive Bidding. The Developer understands that the City is obligated to follow certain laws with respect to the expenditure of public funds, which includes Tax Increment. The Developer agrees to comply and to cause the Affiliated Entities to comply with laws that govern City contracting obligations, including public procurement laws relating to all of the Infrastructure Improvements, such as, without limitation, laws and rules regarding prevailing wage and solicitation of work on a competitive basis. Without limitation of the foregoing, the Developer agrees that in the awarding of contracts for the Infrastructure Improvements (i) it will cause the Affiliated Entities and their contractors to publicly bid competitively contracts for each component of the Infrastructure Improvements, and (ii) through the contract(s) with the applicable contractor(s), the Developer 145 10 and the Affiliated Entities will, in addition to the requirements of Sections 3.9 and 3.10, require such contractor to, pay the Prevailing Wage Rates on such contracts related to the Infrastructure Improvements. The Developer will provide to the City all documentation requested to verify the compliance of the Developer, the Affiliated Entities and the applicable contractor with the foregoing requirements. Failure of the Developer, the Affiliated Entities or the applicable contractor to bid competitively contracts for each component of the Infrastructure Improvements or to require contracts entered into directly with contractors or sub-contractors to include provisions requiring the contractor or sub-contractor to pay the Prevailing Wage Rates on the work related to the Infrastructure Improvements will be considered a breach of this Agreement and the City will be entitled, at its discretion and without obligation, to exercise any and all measures to assure compliance and retroactive compensation plus interest to workers not paid in accordance with this Agreement, and recovery of any penalty or fine assessed by the State attributed to any failure to pay the Prevailing Wage Rates. Additionally, the Developer acknowledges that a violation of these requirements may, in the City’s sole discretion, cause the Infrastructure Improvements to be ineligible for the application of Tax Increment, in which case the City will have no obligation to reimburse the Developer hereunder. 3.6.Utilities. The Developer shall not and shall ensure that the Affiliated Entities do not interfere with, or construct any improvements over, any public street or utility easement without the prior written approval of the City. All connections to public utility lines and facilities shall be subject to approval of the City and any private utility company involved. The Developer at its own expense shall replace any public facilities or utilities damaged during the Projects or the Infrastructure Improvements by the Developer, the Affiliated Entities, IBP, AOI, their respective agents or by others acting on behalf of or under their direction or control of the Developer or the Affiliated Entities, IBP or AOI. 3.7.Permits and Compliance With Laws. The Developer will obtain or will cause the Affiliated Entities to obtain, in a timely manner, all required permits, licenses and approvals, and will meet or will cause the Affiliated Entities to meet all requirements of all local, state and federal laws, rules and regulations which must be obtained or met in connection with the acquisition and construction of the Projects and the Infrastructure Improvements. Without limiting the foregoing, the Developer will request and seek (or will cause the Affiliated Entities to request and seek) to obtain from the City or other appropriate governmental authority all necessary land use, zoning, and building permits. The Developer will comply and will cause the Affiliated Entities to comply in all material respects with all Environmental Laws and Regulations applicable to the construction, acquisition, and operation of the Projects and the Infrastructure Improvements, will obtain any and all necessary environmental reviews, licenses or clearances under, and will comply in all material respects with, Environmental Laws and Regulations. In addition, the Developer shall comply and shall cause the Affiliated Entities to comply fully with all applicable state and federal laws, regulations, and municipal ordinances related to worker safety including but not limited to the Occupational Safety and Health Act (OSHA), the safety rules, codes, and provisions of the Montana Safety Act in Title 50, Chapter 71, MCA, all applicable City, County, and State building and electrical codes, and the Americans with Disabilities Act. 3.8.Easements. To the extent that the Infrastructure Improvements are to be located on the Land, the Developer hereby agrees to grant (or to cause the Affiliated Entities to grant) to 146 11 the City and applicable utility companies from time to time such easements, rights-of-way and similar licenses in a form required by the City and as are reasonably necessary to permit the City to own, operate and maintain the Infrastructure Improvements. 3.9.Nondiscrimination and Equal Pay Affirmation. The Developer agrees to require and to cause the Affiliated Entities to require their contractor(s) to be in compliance with the City’s Nondiscrimination and Equal Pay Affirmation attached hereto as Exhibit F, as well as Title 49, Montana Code Annotated, regarding activities related to the Projects and the Infrastructure Improvements. The Developer agrees that in all contracts that it or the Affiliated Entities enter into with contractors, such contractors will be required to require its subcontractors to comply with the City’s Nondiscrimination and Equal Pay Affirmation attached hereto as Exhibit F, as well as Title 49, Montana Code Annotated, regarding activities related to the Projects and the Infrastructure Improvements. The Developer agrees to provide copies of all such contracts upon request by the City. 3.10.Worker’s Compensation Insurance. The Developer shall provide and shall require the Affiliated Entities to provide in all construction contracts related to the Projects and the Infrastructure Improvements with all of their respective contractors that such contractors are to be covered by a Worker’s Compensation insurance program with the State, a private insurance carrier, or an approved self-insurance plan in accordance with State law. 3.11.Cooperation with City and DOR. The Developer agrees to provide to the City and, as requested, the DOR information that may be required by the City and/or the DOR to determine, or make reasonable projections regarding, the amount and timing of receipt of Tax Increment resulting from the Projects. Such information may include, but is not limited to timing of construction and estimated completion dates of all or portions of the Projects, costs of construction, materials used in construction, uses of the Projects or any portion thereof, allocations of uses to spaces and square feet of spaces included in each of the Projects, and any other information that may be relevant. The Developer understands and agrees that the City will rely on such information from the Developer in making determinations regarding the amount of Tax Increment resulting from the Projects that may be available and the timing of the availability of Tax Increment resulting from the Projects, and that such information may be a critical factor in the City’s determination regarding whether to issue and the sizing and other features of the Bonds. 3.12.Reserved. 3.13.Tenant Requirements; Reporting. Through the subleases with each of IBP and AOI, the Affiliated Entities have specified permissible uses of the Projects, including permissible tenants of each of the Projects. The Developer represents that, to its actual knowledge, the permissible uses and permitted tenants of the Projects, as set forth in the subleases, are in furtherance of the requirements of the Technology District Act that tenants of the District must be engaged in technology-based operations within Montana that, through the employment of knowledge or labor, add value to a product, process, or export service that results in the creation of new wealth and for which at least 50% of the sales of the business or organization occur outside of Montana or the business or organization is a manufacturing company with at least 50% of its sales to other Montana companies that have 50% of their sales occurring outside of 147 12 Montana. To the best of its ability, the Developer will cause the Projects to be operated to meet the requirements of the Technology District Act that tenants of the District must be engaged in technology-based operations within Montana that, through the employment of knowledge or labor, add value to a product, process, or export service that results in the creation of new wealth and for which at least 50% of the sales of the business or organization occur outside of Montana or the business or organization is a manufacturing company with at least 50% of its sales to other Montana companies that have 50% of their sales occurring outside of Montana. Not later than January 15 of each calendar year during the term of this Agreement after the Projects are placed in service, the Developer shall deliver to the City a certification to this effect, substantially in the form attached as Exhibit G. Section 4.City Undertakings. Subject to satisfaction of all conditions in Section 5 below, and solely from Tax Increment on hand or proceeds of the Bonds, the City agrees to reimburse the Developer for the costs of the Infrastructure Improvements in an amount not to exceed the Reimbursable Amount. The Parties acknowledge and agree that, subject to the terms and conditions of this Agreement, (i) the actual sum of all costs of the Infrastructure Improvements may exceed $3,599,178, but the Reimbursable Amount is the maximum amount that the City will reimburse the Developer for the Infrastructure Improvements; and (ii) if the actual sum of all costs of the Infrastructure Improvements exceeds the Reimbursable Amount, the City has discretion to allocate the Reimbursable Amount among the costs of the Infrastructure Improvements as it sees fit. Subject to the Coverage Ratio requirement described in Section 5.2(a)(ii), the City may issue the Bonds in its sole discretion to finance the Reimbursable Amount. The Bonds, if authorized and issued, will have such terms and conditions as are approved by the City Commission. This Agreement does not require or imply that the City has any obligation to issue the Bonds. Section 5.Payment of Reimbursement Amount for Costs of the Infrastructure Improvements. Payment of the Reimbursable Amount by the City to the Developer for costs of the Infrastructure Improvements shall be subject to the following conditions and in accordance with the following procedures: 5.1.Conditions to Payment or Reimbursement. (a)(i) The Developer must have completed or satisfied each of the Milestones by the applicable Milestone Date, as such date may have been extended by the Director of Economic Development or the City Commission pursuant to Section 3.4 hereof, (ii) the City must have issued a certificate of occupancy for each of the Projects, (iii) the Infrastructure Improvements must have been completed in their entirety and the City must have delivered written acceptance of the Infrastructure Improvements (which may be in the form of a Certificate of Completion or such other format as required by the City), and (iv) the Developer must demonstrate to the City’s satisfaction, by a title report or other means acceptable to the City, that the Infrastructure Improvements are free of financial liens and any encumbrances affecting the Infrastructure Improvements must be acceptable to the City. (b)Reimbursement by the City for costs of the Infrastructure Improvements must be based on paid invoices for costs incurred by the Developer, the Affiliated Entities, their contractors and subcontractors or utility companies, which the Developer must supply to the 148 13 City. The City may reject, in its sole discretion, any invoice related to the Infrastructure Improvements. The City will notify the Developer of any rejected invoice and the reason it was rejected. The Parties acknowledge that some combination of the Developer and the Affiliated Entities will incur and pay the costs of the Infrastructure Improvements, and the City will not reject any invoice solely because it was paid by one of the Affiliated Entities rather than the Developer. Regardless of which entity pays costs incurred with respect to the Projects and the Infrastructure Improvements, the Developer has the sole right to receive all reimbursements from City for costs of the Infrastructure Improvements as provided under the Agreement. (c)The Parties agree that the City will have no obligation to reimburse any of the costs of the Infrastructure Improvements unless at the time of such request (i) all of the Developer’s representations as set forth in Section 2.2 are true and correct, (ii) the Developer is not in breach of any covenant or undertaking as set forth in Section 3, and (iii) unless and to the extent the City issues the Bonds, there shall be adequate Tax Increment available to pay the Reimbursable Amount and satisfy all other financial obligations related to the District. (d)The Developer, or other Person(s) responsible for paying such Taxes, shall have paid Taxes with respect to the Projects for one full Fiscal Year after the assessed and taxable values of both of the Projects, as completed, are reflected in the certified taxable values of the City provided by the Department of Revenue. For example, if the Projects are completed in July 2024, the value of the Projects as completed will be assessed by the Department of Revenue in January 2025; included in certified values provided to the City in August 2025; and the Taxes due on November 30, 2025 and May 31, 2026 (Fiscal Year 2025/26) with respect to the Projects must be paid before the Developer is eligible for reimbursement. (e)If some or all of the Reimbursable Amount is to be paid with the proceeds of the Bonds, the City shall have determined, in its sole discretion, but with the cooperation of the Developer, that the Tax Increment is sufficient to pay the debt service on the Bonds as and when due, to produce a Coverage Ratio (as defined in Section 5.2(a)(ii)) with respect to the Bonds of not less than 1.7, and, as applicable, to satisfy other requirements under the Bond Resolution, such as funding an adequate reserve, meeting applicable debt service coverage requirements, and paying Costs of Issuance, and to satisfy all other financial obligations related to the District. The Developer understands and agrees the City shall have no obligation to and may not issue the Bonds if the City is unable to find and determine that the Tax Increment is sufficient to pay the Bonds timely, to produce a Coverage Ratio of not less than 1.7, to satisfy the requirements of the Bond Resolution, and to satisfy all other financial obligations related to the District. If any of the above conditions are not satisfied in the determination of the City, the City shall have no obligation to reimburse the Developer for any of the costs of the Infrastructure Improvements and the City’s determination to refrain from reimbursing, or its inability to reimburse, any of the costs of the Infrastructure Improvements shall not be or result in a default of this Agreement. 5.2.Process for Reimbursement; Determination of Reimbursable Amount; Developer Option to Terminate. Subject to the provisions of subsection (c) of this Section 5.2, the process for reimbursement of the Developer is as follows: 149 14 (a)The City will determine the Reimbursable Amount in the following manner: (i)Following the payment of Taxes relating to the Projects as completed for one full Fiscal Year, as described under Section 5.1(d) above, the Developer shall provide to the City a signed request for reimbursement substantially in the form attached as Exhibit E hereto and acceptable to the City, accompanied by the invoices paid by the Developer or the Affiliated Entities and lien waivers from the contractors or subcontractors performing or that have performed the work to be reimbursed. In addition, the Developer agrees to provide to the City any additional information requested by the City for the City to determine whether the Developer’s request for reimbursement complies with this Agreement. Based on this Developer certificate and the related information provided by the Developer, the City Manager or his or her designee shall determine the actual cost of the Infrastructure Improvements. (ii)Based on Tax Increment revenues received in the District in the first Fiscal Year that the assessed and taxable values of the Projects, as completed, are included in the certified taxable values provided to the City by the Department of Revenue, and using assumptions regarding interest rates and terms of proposed Bonds that the City finds reasonable in its sole discretion, the City will determine the maximum principal amount of the Bonds (including amounts to be used to pay Costs of Issuance and, if desirable, to fund a debt service reserve account) that can be issued that produces a Coverage Ratio on the Bonds of not less than 1.7. “Coverage Ratio” for this purpose means the quotient of (A) Tax Increment in the first Fiscal Year that assessed and taxable values of the Projects as completed are reflected in the certified taxable values of the City provided by the Department of Revenue, divided by (B) projected maximum annual debt service on the proposed Bonds. (iii)The Reimbursable Amount will be equal to the least of (A) $3,599,178; (B) the actual cost of the Infrastructure Improvements determined as described under Section 5.2(a)(i); and (C) if the Bonds are issued, the proceeds of the Bonds, less proceeds of the Bonds used to pay Costs of Issuance and, if desirable, to fund a debt service reserve account; recognizing that the Bonds must meet the Coverage Ratio determined as described in Section 5.2(a)(ii). (b)By the date that is five months after the submission by the Developer of a complete and acceptable request for reimbursement, as determined by the City, the City, subject to the terms and conditions of this Agreement, shall reimburse to the Developer such costs of the Infrastructure Improvements, in an amount not to exceed the Reimbursable Amount, either directly from Tax Increment or from proceeds of Bonds; provided, however, if the City shall earlier determine that the Tax Increment is not sufficient to reimburse the Developer for the costs of the Infrastructure Improvements, either because there is insufficient Tax Increment then available or the City determines there is insufficient Tax Increment to permit the issuance of Bonds, then the City shall so inform the Developer in writing and this Agreement shall thereupon terminate and neither Party will have any further rights or obligations hereunder, except as set forth in those provisions that expressly survive termination of this Agreement. 150 15 (c)Alternatively, the Developer may terminate this Agreement by written notice to the City at any time prior to providing the City with a signed request for reimbursement as described under Section 5.2(a)(i) above. Section 6.Sources of Repayment; Covenants to Pay Taxes. 6.1.Taxes. The Developer shall pay or cause to be paid when due and prior to the imposition of penalty all Taxes and all installments of any special assessments payable with respect to the Land and the Projects and any improvements thereto or extension thereof. 6.2.Maintenance of Land and Projects. The Developer agrees to use its commercially reasonable best efforts to maintain and operate the Land and the Projects (or to cause the Land and the Projects to be maintained and operated) so that the Developer or other Person responsible will be able at all times to pay promptly and when due all property taxes levied with respect to the Land and the Projects. 6.3.Injunction; Specific Performance. The Parties agree that, in the event of a breach of this Section 6 by the Developer or its successors or assigns, the City would suffer irreparable harm. Therefore, in the event the Developer or its successors or assigns fails to comply with the provisions of this Section 6, the Developer agrees that the City, subject to any notice and cure period in this Agreement, may pursue any remedy at law or in equity, including, without limitation, the remedies of injunction and specific performance. Section 7.Indemnification and Insurance. 7.1.Indemnification. The Developer releases the City and all City Commission members, board members, officers, agents, servants and employees of the City (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, damage, cost (including reasonable attorneys’ fees), claim, demand, suit, action or other proceeding whatsoever (i) arising or purportedly arising out of, or resulting or purportedly resulting from, the acquisition and construction of the Projects, including the Infrastructure Improvements, any violation by the Developer of any agreement, condition or covenant of this Agreement, the ownership, maintenance and operation of the Projects, or the presence on any portion of the Land, of any dangerous, toxic or hazardous pollutants, contaminants, chemicals, waste, materials or substances; or (ii) which is proximately caused by the Developer or its officers, agents, contractors, consultants or employees. 7.2.Insurance. Developer shall, or shall cause the Affiliated Entities to, keep and maintain the Projects at all times insured against such risks and in such amounts, with such deductible provisions, as are customary in connection with facilities of the type and size comparable to the Projects, and the Developer shall, or shall cause the Affiliated Entities to, carry and maintain, or cause to be carried and maintained, and pay or cause to be paid timely the premiums for direct damage insurance covering all risks of loss, including, but not limited to, the following: 1.fire 2.extended coverage perils 151 16 3.vandalism and malicious mischief 4.boiler explosion (but only if steam boilers are present) 5.collapse on a replacement cost basis in an amount equivalent to the Full Insurable Value thereof. “Full Insurable Value” shall include the actual replacement cost of the Projects, exclusive of foundations and footings, without deduction for architectural, engineering, legal or administrative fees or for depreciation. The policies required by this Section 7.2 shall be subject to a no coinsurance clause or contain an agreed amount clause, and must contain a deductibility provision not exceeding $100,000. Subject to the terms of any mortgage relating to the Projects, policies of insurance required by this Section 7.2 shall insure and be payable to Developer, and shall provide for release of insurance proceeds to Developer for restoration of loss. The City shall be furnished certificates showing the existence of such insurance. In case of loss, Developer is hereby authorized to adjust the loss and execute proof thereof in the name of all parties in interest. During construction of the Projects, any and all of the foregoing insurance policies may be maintained by the applicable contractor; provided that once the Projects are placed into service, Developer shall maintain or cause to be maintained all of the foregoing insurance policies. In addition, as a condition to placing the Projects in service, the City may require that the Developer or owner of the Projects obtain additional insurance that would protect the City or the City’s interest in the Infrastructure Improvements. In addition to and independent of the above, the Developer shall secure or cause the Affiliated Entities to secure liability insurance through an insurance company or companies duly licensed and authorized to conduct insurance business in Montana. The insurance shall not contain any exclusion for liabilities specifically assumed by the Developer in this Section. The insurance shall cover and apply to all claims, demands, suits, damages, losses, and expenses that may be asserted or claimed against, recovered from, or suffered by the City in relation to construction of the Projects and the Infrastructure Improvements without limit and without regard to the cause therefore. The Developer must furnish to the City an accompanying certificate of insurance and accompanying endorsements in amounts not less than as follows: Commercial General Liability - $1,000,000 per occurrence; $2,000,000 annual aggregate The above amounts shall be exclusive of defense costs. The City, its officers, agents, and employees, shall be endorsed as an additional or named insured on a primary non-contributory basis on the Commercial General Liability policy. The insurance and required endorsements must be in a form suitable to City and shall include no less than a thirty (30) day notice of cancellation or non-renewal. The City must approve all insurance coverage and endorsements prior to the Developer commencing work on Projects or Infrastructure Improvements. Developer must notify the City within two (2) business days of Developer’s receipt of notice that any required insurance coverage will be terminated or Developer’s decision to terminate any required insurance coverage for any reason. 152 17 Section 8.General Provisions. 8.1.Conflicts of Interest; City’s Representatives Not Individually Liable. The Developer represents that it does not employ, retain, or contract with an officer or employee of the City and that no member, officer or employee of the City has a personal or financial interest, direct or indirect, in this Agreement or in the Projects, or a financial interest in the Infrastructure Improvements. No member, officer or employee of the City shall be personally liable to Developer in the event of any default under or breach of this Agreement by the City, or for any amount that may become due to Developer for any obligation issued under or arising from the terms of this Agreement. 8.2.Rights Cumulative. The rights and remedies of the Parties of this Agreement, whether provided by law or by this Agreement, shall be cumulative, and the exercise by any Party hereto of any one or more of such remedies shall not preclude the exercise by such Party, at the same or different times, of any other remedy for the same default or breach or of any of its remedies for any other default or breach of the Party subject to the limitation of remedies provided herein. No waiver made by such Party with respect to the performance or the manner or time thereof, of any obligation under this Agreement, shall be considered a waiver with respect to the particular obligation of the other Party or a condition to its own obligation beyond those expressly waived in writing and to the extent thereof, or a waiver in any respect in regard to any other rights of the Party making the waiver of any obligations of the other Party. Delay by a Party hereto instituting or prosecuting any cause of action or claim hereunder shall not be deemed a waiver of any rights hereunder. 8.3.Term of Agreement. This Agreement shall remain in effect until the date that it terminates or is terminated, as follows: (a)If the Reimbursable Amount is paid directly from Tax Increment and not proceeds of Bonds, this Agreement will terminate on the date that is 10 days after the date the City makes the final payment of the Reimbursable Amount to the Developer hereunder. (b)If the City issues Bonds, this Agreement will remain in effect until the final maturity or payment date of the Bonds or such earlier date that the Bonds are prepaid in full, discharged, and no longer outstanding. (c)This Agreement may be terminated by the City in its sole discretion on a date earlier than described in (a) or (b) above at any time after failure by the Developer to complete or satisfy a Milestone by the applicable Milestone Payment Date (as such date may be extended as described in Section 3.4). (d)If the City has determined Tax Increment is insufficient under Section 5.2(b) above, this Agreement shall terminate in the manner and on the date described in Section 5.2(b) above. (e)Prior to submitting a request for reimbursement, the Developer may terminate this Agreement in the manner described in Section 5.2(c) above. 153 18 8.4.Limitation on City Liability. No agreements or provisions contained in this Agreement nor any agreement, covenant or undertaking by the City contained in any document in connection with the Projects or the Infrastructure Improvements shall give rise to any pecuniary liability of the City or a charge against its general credit or taxing powers, or shall obligate the City financially in any way except with respect to then-available Tax Increment. No failure of the City to comply with any term, condition, covenant or agreement herein shall subject the City to liability for any claim for damages, costs or other financial or pecuniary charge except to the extent that the same can be paid or recovered from then-available Tax Increment; and no execution on any claim, demand, cause of action or judgment shall be levied upon or collected from the general credit, general funds or taxing powers of the City (except as such constitute then-available Tax Increment). Nothing herein shall preclude a proper party in interest from seeking and obtaining specific performance against the City for any failure to comply with any term, condition, covenant or agreement herein; provided that no costs, expenses or other monetary relief shall be recoverable from the City except as may be payable from the Tax Increment. This Agreement shall not constitute or be construed to give rise to a debt of the City. 8.5.Assignment. This Agreement is unique between the City and Developer and no Party may assign any rights or privileges, or delegate any duties or obligations under this Agreement, without first obtaining the written consent of the other Party. Notwithstanding the foregoing, the Developer may assign this Agreement and its rights and responsibilities hereunder to a special purpose entity formed by the Developer to own the Projects. Developer shall provide notice of any assignment to the City. 8.6.Successors Bound By Agreement; No Third Party Beneficiary; No Property Interest. Subject to compliance with Section 8.5, this Agreement will inure to the benefit of and be binding upon the Parties to this Agreement and their respective successors in interest and permitted assignees. This Agreement is for the exclusive benefit of the Parties, does not constitute a third-party beneficiary agreement, and may not be relied upon or enforced by a third party. This Agreement, by itself, does not create or give rise to a property interest in the Land or the Projects. 8.7.Prior Agreements. This Agreement supersedes, merges and voids any and all prior discussions, negotiations, agreements and undertakings between the Parties with respect to the subject matter of this Agreement. The Parties waive and release each other from any claims, actions, or causes of action that relate in any manner to any prior discussions, negotiations, agreements and undertakings between the Parties with respect to the subject matter of this Agreement. 8.8.Entire Agreement. This Agreement, including any exhibits and attachments hereto, embodies the entire agreement and understanding of the Parties with respect to its subject matter. All Parties shall be prohibited from offering into evidence in any arbitration or civil action any terms, conditions, understandings, warranties, statements or representations, whether oral or written, with respect to the subject matter of this Agreement and that are not contained in this Agreement. 154 19 8.9.Amendments, Changes and Modifications. This Agreement may be amended and any of its terms may be modified only by written amendment authorized and signed by the Parties hereto. 8.10.Headings. The headings of articles and sections in this Agreement are inserted for convenience of reference only and do not limit or amplify the terms and provisions of the Agreement in any manner. The headings will be ignored and will not affect the construction of any provisions of this Agreement. 8.11.Notice. Any formal notice, demand or communication required or permitted by the terms of this Agreement to be given to the City or Developer will be in writing and will be delivered to such Party either: (i) by personal hand-delivery; or (ii) by depositing the same in the United States mail, certified mail with return receipt requested, addressed to such Party at the address named below, with postage prepaid thereon. Notice will be deemed complete upon receipt of the notice pursuant to any of the foregoing methods of notice. If to City: City of Bozeman Attention: Bozeman City Manager 121 N. Rouse Ave. P.O. Box 1230 Bozeman, MT 59771 If to Developer: Big Sky ICINF, LLC Attention: [_________] [_________] The City and the Developer, by notice given hereunder, may designate different addresses to which subsequent notices, certificates or other communications should be sent. 8.12. Severability. If any provision of this Agreement is declared void or held invalid, such provision will be deemed severed from this Agreement and the remaining provisions of this Agreement will otherwise remain in full force and effect. 8.13.Duplicate Originals or Counterparts. This Agreement may be executed in two or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement. 8.14.Place of Performance. The place of performance of this Agreement will be in the City of Bozeman, Gallatin County, Montana. 8.15.Governing Law. This agreement and the legal relations between the Parties hereto will be governed by and construed in accordance with the laws of the State of Montana, without giving effect to any choice of law statutes, rules, or principles. 155 20 8.16.Dispute Resolution. (a)Any claim, controversy, or dispute between the Parties, their agents, employees, or representatives shall be resolved first by negotiation between senior-level personnel from each Party duly authorized to execute settlement agreements. Upon mutual agreement of the Parties, the Parties may invite an independent, disinterested mediator acceptable to the Parties to assist in the negotiated settlement discussions. (b)If the Parties are unable to resolve the dispute within thirty (30) days from the date the dispute was first raised, then such dispute may only be resolved in a court of competent jurisdiction in compliance with the applicable law and the provisions of this Agreement. 8.17.Further Assurances and Corrective Instruments. The Parties agree that they will, from time to time, execute, acknowledge and deliver, or cause to be executed, acknowledged and delivered, such supplements hereto and such further instruments as may reasonably be required for correcting any inadequate or incorrect description of the Projects or the Infrastructure Improvements, or for carrying out the expressed intention of this Agreement. 8.18.Reports/Accountability/Public Information. Developer agrees to develop and/or provide documentation as requested by the City demonstrating the Developer’s compliance with the requirements of this Agreement. Developer shall allow the City, its auditors, and other persons authorized by the City to inspect and copy its books and records for the purpose of verifying that the monies distributed to the Developer pursuant to this Agreement were used in compliance with this Agreement and all applicable provisions of federal, state, and local law. The Developer shall not issue any statements, releases or information for public dissemination regarding this Agreement or the work contemplated hereunder without prior written approval of the City. 8.19.Consent to Electronic Signatures. The Parties have consented to execute this instrument electronically in conformance with the Montana Uniform Electronic Transactions Act, Title 30, Chapter 18, Part 1, MCA. [Balance of page intentionally left blank] 156 21 IN WITNESS WHEREOF, the Parties hereto have caused this Development Agreement to be executed as of the [_____] day of [___________], 2022. CITY OF BOZEMAN, MONTANA By:_______________________________________ Printed Name: Jeff Mihelich Title: City Manager [Signature Page to Development Agreement] 157 22 BIG SKY ICINF, LLC By:Innovation Campus Partners, LLC By: Bough Development, LLC By:______________________________________ Loren Bough, Manager Witness:_________________________________ By: Charter MSU, LLC By:_______________________________________ Paul S. Brandes, Member of Charter MSU, LLC Witness:___________________________________ By:______________________________________ Daniel Zelson, Member of Charter MSU, LLC Witness:________________________________ [Signature Page to Development Agreement] 158 ACKNOWLEDGEMENT This Acknowledgement is attached and hereby incorporated into to the Development Agreement (MSU Innovation Campus), dated as of [__________], 2022 (the “Agreement”), between Big Sky ICINF, LLC (the “Developer”) and the City of Bozeman, Montana (the “City”). Capitalized terms used and not defined herein have the meanings the Agreement gives them. Each of Big Sky QF, LLC, a Delaware limited liability company (“BSQ”), and BIG SKY AURORA, LLC, a Delaware limited liability company (“BSA”), acknowledge, agree, and represent as follows: (1)BSQ and BSA have reviewed the Agreement; (2)BSQ and BSA are affiliated with the Developer and are the “Affiliated Entities” described in the Agreement; (3)The Developer is authorized to cause the Affiliated Entities to do all of the things the Developer represents and covenants to cause them to do under the Agreement; (4)All statements about and references to the Affiliated Entities in the Agreement are accurate and acceptable to the Affiliated Entities; and (5)Regardless of which entity pays costs incurred with respect to the Projects and the Infrastructure Improvements, the Developer has the sole right to receive all reimbursements from City for costs of the Infrastructure Improvements as provided under the Agreement. BSQ and BSA each acknowledge that they benefit, directly or indirectly, from the arrangements set forth in the Agreement, and each of BSQ and BSA desire to sign this Acknowledgment to induce the City and the Developer to enter into the Agreement. 159 2 IN WITNESS WHEREOF, BSQ and BSA have caused this Acknowledgement to Development Agreement to be executed as of the [_____] day of [___________], 2022. BIG SKY AURORA LLC, a Delaware limited liability company By:Innovation Campus Partners, LLC By: Bough Development, LLC By:______________________________________ Loren Bough, Manager Witness:_________________________________ By: Charter MSU, LLC By:_______________________________________ Paul S. Brandes, Member of Charter MSU, LLC Witness:___________________________________ By:______________________________________ Daniel Zelson, Member of Charter MSU, LLC Witness:________________________________ [Signature page to Acknowledgment] 160 3 BIG SKY QF LLC, a Delaware limited liability company By:Innovation Campus Partners, LLC By: Bough Development, LLC By:______________________________________ Loren Bough, Manager Witness:_________________________________ By: Charter MSU, LLC By:_______________________________________ Paul S. Brandes, Member of Charter MSU, LLC Witness:___________________________________ By:______________________________________ Daniel Zelson, Member of Charter MSU, LLC Witness:________________________________ [Signature page to Acknowledgment] 161 A-1 EXHIBIT A PROJECT COSTS 162 2 163 B-1 EXHIBIT B LEGAL DESCRIPTION OF THE LAND 164 C-1 EXHIBIT C COSTS OF THE INFRASTRUCTURE IMPROVEMENTS Infrastructure Improvements: Site work—public infrastructure $2,726,980 Landscaping 295,000 Utilities 250,000 Contingency 327,198 Total:$3,599,178 The Parties acknowledge and agree that, subject to the terms and conditions of this Agreement, (i) the actual sum of all costs of the Infrastructure Improvements may exceed $3,599,178, but the Reimbursable Amount is the maximum amount that the City will reimburse the Developer for costs of the Infrastructure Improvements; and (ii) if the actual sum of all costs of the Infrastructure Improvements exceeds the Reimbursable Amount, the City has discretion to allocate the Reimbursable Amount among the costs of the Infrastructure Improvements. 165 D-1 EXHIBIT D MILESTONES INDUSTRY: MILESTONE MILESTONE DATE Site Plan Submittal to the City Submitted Development Building Permit Submittal Submitted Start of Development Construction 9/30/2022 Start of Infrastructure Construction 9/30/2022 Substantial Completion of Infrastructure Construction 9/30/2023 Completion of Development Construction (occupancy)2/15/2024 Aurora: MILESTONE MILESTONE DATE Site Plan Submittal to the City Submitted Development Building Permit Submittal 9/30/2022 Start of Development Construction 12/15/2022 Start of Infrastructure Construction 9/01/2022 Substantial Completion of Infrastructure Construction 9/01/2023 Completion of Development Construction (occupancy)10/01/2025 166 E-1 EXHIBIT E FORM OF DEVELOPER CERTIFICATE REGARDING COSTS OF INFRASTRUCTURE IMPROVEMENTS TO:City of Bozeman, Montana FROM:Big Sky ICINF, LLC (the “Developer”) SUBJECT:Reimbursement for costs of the Infrastructure Improvements This Developer certificate requests $_________ for reimbursement of costs of the Infrastructure Improvements, as defined in the Development Agreement between Big Sky ICINF, LLC and the City of Bozeman, Montana, dated as of _________, 2022 (the “Development Agreement”). Capitalized terms used but not otherwise defined herein shall have the respective meanings given such terms in the Development Agreement. Pursuant to Section 5.2(a) of the Development Agreement, the undersigned hereby certifies on behalf of the Developer that: (a)the expenditures for which reimbursement is requested are listed in summary form in the attached schedule headed “Project Expenditures;” (b)paid invoices corresponding to the expenditures set forth on the attached Project Expenditures Schedule are appended to the attached schedule headed “Project Invoices;” (c)the amounts for which reimbursement is requested have been paid by the Developer or the Affiliated Entities to the contractors, subcontractors, materialmen, engineers, architects or other persons who or that have performed necessary or appropriate services or supplied necessary or appropriate materials for the acquisition, construction, renovation, equipping, and installation of the Infrastructure Improvements; (d)the contractor and subcontractors were solicited and retained competitively and all persons performing work on the Infrastructure Improvements were paid the Montana prevailing wage for such work; (e)no part of the several amounts requested to be paid, as stated in such certificate, has been or is the basis for the payment of any money in any previous request; (f)the reimbursement of the amounts requested will not result in a breach of any of the covenants of the Developer contained in the Development Agreement; and (g)no litigation has been instituted or is threatened with regard to any amounts sought to be reimbursed, and binding and enforceable lien waivers have been obtained from all contractors, subcontractors, materialmen, and others with regard to all work related to any amounts for which reimbursement is requested. 167 E-2 The Developer represents that all of the representations of the Developer in Section 2.2 of the Development Agreement are true and correct as of the date hereof and the Developer is not in default of the performance of any of its undertakings or obligations under Section 3 of the Development Agreement as of the date hereof. Regardless of which entity paid the attached invoices relating to the Infrastructure Improvements, the Developer has the sole right to receive all reimbursements from City for costs of the Infrastructure Improvements as provided under the Development Agreement. Dated: _____________, 20__Big Sky ICINF, LLC By: Authorized Developer Representative 168 F-1 EXHIBIT F 169 F-1 EXHIBIT G FORM OF DEVELOPER’S ANNUAL CERTIFICATION TO:City of Bozeman, Montana FROM:Big Sky ICINF, LLC (the “Developer”) SUBJECT:Annual Certification for Calendar Year 20__ Pursuant to Section 3.13 of the Development Agreement between Big Sky ICINF, LLC and the City of Bozeman, Montana, dated as of _________, 2022 (the “Development Agreement”), the undersigned hereby certifies on behalf of the Developer that, to the best of the Developer’s knowledge, tenants of the Projects (as defined in the Development Agreement) are engaged in technology-based operations within Montana that, through the employment of knowledge or labor, add value to a product, process, or export service that results in the creation of new wealth and for which at least 50% of the sales of the business or organization occur outside of Montana or the business or organization is a manufacturing company with at least 50% of its sales to other Montana companies that have 50% of their sales occurring outside of Montana. Dated: _____________, 20__Big Sky ICINF, LLC By: Authorized Developer Representative 170 SOUTH BOZEMAN TECHNOLOGY DISTRICT TIF REQUEST MONTANA STATE UNIVERSITY INNOVATION CAMPUS DEVELOPMENT LEGAL DESCRIPTION: LEGAL DESCRIPTION TRACT C-1A OF THE AMENDED PLAT OF WEST COLLEGE MINOR SUBDIVISION NO. 195 IN THE NORTHWEST 1/4 & NORTHEAST 1/4, SECTION 14, T2S, R5E, P.M.M, CITY OF BOZEMAN, COUNTY OF GALLATIN, STATE OF MONTANA. MAY 2022 | CHARTER REALTY AND DEVELOPMENT 171 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District The founding intent and original adopting ordinance of the South Bozeman Technology District (SBTD) was to “provide(s) a place where people and ideas come together in an environment that assists and supports start-up companies and new ideas.” The approximately 88,000 square foot Industry building that we plan to break ground on this year does exactly that. In fact, “supporting start-up companies and new ideas” is at the heart of Industry’s mission. Additionally, the goal of the SBTD Comprehensive Development plan was that the Innovation Campus “provides state- of-the-art facilities for small, medium, large, and well-established companies to locate and prosper”. The 87,000 sq foot Aurora Technologies building that will follow Industry accomplishes this goal. Moreover, the objective of being “a place where students gain hands-on real-world learning experiences that result in employment opportunities upon graduation” will immediately come to fruition. Aurora is now in Bozeman because it acquired Blackmore Sensors, a company that was founded by Montana State graduates, has its employee ranks filled with MSU graduates, and is fully committed to working with Montana State University to continue hiring both interns and full-time employees directly out of the university. In addition, the original SBTD intent was “to provide for an appropriate mix of R&D activities, commercial, and light-manufacturing development”, all of which will occur within the Industry and Aurora buildings, and to “ensure efficiency in the use of land within the District, and the capacity of public infrastructure”, which is the genesis of our TIF request. Moreover, the SBTD Comprehensive Development Plan acknowledges that “It is important to note that virtually every Tech Park successful or not, has received significant investment of public funds.” Our TIF request fits into this acknowledgement, and with the cost of vertical construction rising at the most rapid pace in history, TIF funds for the public infrastructure are even more necessary now to realize the objectives/intent of the original SBTD plan. We are working to build upward of $85 million in vertical construction, all from private capital, and thus our TIF request of $4 million represents just 4.7% of the capital required to complete the project, but is essential in the overall project being completed. Lastly, the entirety of the work that results from the TIF grant– roads, infrastructure, landscaping-- will be dedicated back to the City of Bozeman. MSU Innovation Campus Infrastructure Development: The project will design, develop, install and build the necessary infrastructure to turn the Montana State University Innovation Campus into a full-fledged 42-acre development, capable of supporting close to 750,000 square feet of incubator, office, laboratory, R&D and light manufacturing-type space. This will be the first development of its kind within the South Bozeman Technology District and it will serve as a major catalyst to realize the founding goals of the District. Beyond the increase of large, taxable units on site, this project will bring density to a significant economic growth area, along with a new walkable sense of place to the local economy, where both local employers, employees, clients and visitors can congregate and enjoy the landscape of the multiple mountain ranges that surround the Campus, whether by foot or by bike. The best part of this potential TIF financing is that the businesses that will benefit from the TIF assistance will be some of the most significant employers in Bozeman, both now and in the future. Additionally, the TIF assistance will help grow the Innovation Campus beyond Industry and Aurora, thereby increasing the number of employers that help the local economy thrive through high-paying jobs and long-term opportunities for their workforce. PROJECT NARRATIVE 172 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Multimodal Transportation: As per the original SBTD Plan: “The Innovation Campus will have walkways, jogging, and biking trails. As the Innovation Campus develops, expansion will include open green spaces, water features, as well as a partnership to support further development of retail contiguous to the west side of the Innovation Campus.” The current project requesting TIF assistance incorporates roads, infrastructure and bike/walking/running paths that facilitates safe, efficient, and convenient access to the district for all modes of transportation. As part of this project and site development, the roads/infrastructure/landscaping and will develop, complete and improve conditions in the SBTD. Having already committed capital to tearing down and removing the old Dairy Barn structures, as well as remnants of the old ROTC structure, and crushing abandoned foundations and cement, the entire Innovation Campus will be completed and built to City Engineering Standards. This means pedestrian friendly routes, sidewalks and nature immersed engagements, combined with vibrant commercial development. Clearly defined ground level spaces will surround the new buildings, providing the look and feel of a true centralized economic growth area. The Campus will also include accessible facilities and open green space for passive recreation and enjoyment. Its proximity to other southwest amenities in the surrounding area and the urban sidewalk network we are creating will make it an easy destination to access. Site developments will also create a clean, safe and inviting location within the South Bozeman Technology District. Timeline: 1. Site Plan Final Review – May 2022 (Industry), June/July 2022 (Aurora) 2. Building Permitting - May 2022 (Industry), July/August (Aurora) 3. Mobilization/ Demolition/ Groundbreaking – Late Spring/Early Summer 2022 4. Construction Duration – 12-24 months (estimate) TIF Need/Impact: Because final budgets for the Aurora and Industry projects have already come back significantly higher than expected, if TIF Assistance is not granted, the project is at risk of being put on hold. With the construction of almost 180,000 square feet of Class A commercial space as part of the next phase of development, and the rapidly rising cost of construction (upward of 100% YoY price increases), the ability to deliver both the buildings and the road/ infrastructure/landscaping is severely at risk. If the TIF request is granted, however, we are absolutely confident that not only will the overall project take place, but it will also be delivered in a timely fashion. 173 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Original Intent of South Bozeman Technology District: According to the SBTD founding Plan: “Several factors were weighed in developing the MSU Innovation Campus: 1) Public/Private partnerships between business, industry, government and MSU 2) Internships, assistantships, part-time and full-time opportunities for MSU students 3) High-tech/high-paying jobs 4) Global competitiveness for Bozeman, Gallatin County, and the State of Montana 5) Economic benefits for the community The MSU Innovation Campus offers high-tech employment opportunities and provides a convergence for economic activity giving hope for an increased standard of living in Bozeman and the Gallatin County. The MSU Innovation Campus provides the physical location, buildings, services and amenities for people who build, operate, study, research, develop, produce, and enhance new discoveries.” Expected/Realized outcome: With the first three buildings being built on the Innovation Campus (ARL, Industry, Aurora), all of the above objectives and goals are being met. With the TIF assistance we are requesting, we will be able to bring all of this to fruition and truly realize the founding objectives of the South Bozeman Technology District, and meet the purpose behind the creation of the TIF when it was first created. Original Intent of South Bozeman Technology District: “Proximity to other tech companies and other labs offers potential opportunities for collaboration, commercialization, spin-offs and growth of new and existing technologies.” Expected/Realized outcome: We are achieving this very important objective on the Innovation Campus and delivering to the local economy the exact aspirations that were the original intent of the district. Original Intent of South Bozeman Technology District: “Expansion of the MSU Innovation Campus will be a long-term initiative (15+ years) a. It will likely take at least a decade or two to fully develop the property 174 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District b. The economics will be both challenging and fruitful, due to the cost of necessary infrastructure and investment made to construct state-of-the-art facilities c. The competition among cities and nations for companies and new technologies will continue to be fierce d. Though the vision will evolve over time, the past and current vision will sustain the development” Expected/Realized outcome: We have cut the above timeline down by 10 years as we have been at work on this for 4+ years now and are on the brink of establishing the MSU Innovation Campus as a regional/national economic hub. And while the economics of development have become “challenging” with the rising costs associated with it, the outcome will absolutely be “fruitful” for the local economy. The competition is as fierce as ever, but because we are successfully bringing the capital and the right partners to invest and build the aforementioned state of the art facilities, the TIF assistance for roads/infrastructure/ landscape will help us clear the final “challenging” hurdle to accomplish the overall “vision” and original goals. Conclusion: Per the Bozeman South Technology District original adopting ordinance: “Factors Critical To Success of the Montana State University Innovation Campus: 1. The first factor necessary for the successful development of the MSU Innovation Campus is capital. 2. It is important to note that virtually every Tech Park successful or not, has received significant investment of public funds. 3. We believe the MSU Innovation Campus not only has the potential to transform the city, but also the entire region, and the state of Montana.” We agree with all three key points above. As a result, we are bringing close to $85 million in private capital to this project. And that’s just today. As the project evolves, we will be bringing even more. Far in excess of $150 million after all is said in done. The tax increment that occurs on these 42 acres will be historic. It is out belief, based on conservative estimates of the TIF increment that is created by Industry and Aurora, that the TIF assistance we are requesting would be paid back within the first 5 years after each of the buildings officially open. In conclusion, and as stated by the adopting ordinance, every successful “Tech Park” has “received significant investment of public funds.” Our request for TIF assistance is directly inline with the original intent and plan. And if granted, we will realize the objective of the overall district, which is “to transform the city, but also the entire region, and the state of Montana.” 175 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District We will be building and constructing Technology Boulevard, Innovation Avenue and all of the associated infrastructure and landscaping necessary to develop the Campus in its entirety. MAPS, EXHIBITS,PLANS 176 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Aurora: RENDERINGS 177 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Aurora: RENDERINGS 178 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Industry: RENDERINGS 179 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Industry: RENDERINGS 180 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Industry: RENDERINGS 181 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Industry: RENDERINGS 182 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Industry: RENDERINGS 183 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Industry: RENDERINGS 184 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Industry: RENDERINGS 185 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District Industry: RENDERINGS 186 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District PROJECT FINANCIALS AND TIF REQUEST 187 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District PROJECT FINANCIALS AND TIF REQUEST 188 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District TIF ELIGIBLE EXPENSES AND PUBLIC BID INFO 189 MSU Innovation Campus Charter Realty and Development South Bozeman Technology District TIF ELIGIBLE EXPENSES AND PUBLIC BID INFO 190 Memorandum REPORT TO:City Commission FROM:Greg Sullivan, City Attorney SUBJECT:Ordinance 2118 Provisional Adoption Authorizing City Commission to Establish by Resolution Criteria and Procedures for Remote Participation by Commissioners and Board Members and Resolution 5421 Establishing Criteria and Procedures for Remote Participation MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Ordinance RECOMMENDATION:Provisionally Adopt Ordinance 2118 and Adopt Resolution 5421 STRATEGIC PLAN:7.3 Best Practices, Creativity & Foresight: Utilize best practices, innovative approaches, and constantly anticipate new directions and changes relevant to the governance of the City. Be also adaptable and flexible with an outward focus on the customer and an external understanding of the issues as others may see them. BACKGROUND:Throughout the COVID-19 Pandemic the City demonstrated it can conduct effective public meetings using remote video software applications. Commissioners have asked whether the City can conduct public meetings where a member of the Commission could attend the meeting using remote technology. This agenda item first proposes adoption of a Commission rule of procedure which will authorize the Commission to adopt standards for remote participation through Resolution. In turn, this agenda then item proposes a resolution that would establish the criteria and procedures that must be followed for a commissioner to attend a public meeting using remote methods. Proposed Ordinance amends 2.02.110, BMC to authorize the Commission to adopt, by Resolution, “procedures and criteria for when a commissioner may participate remotely and the manner in which the remote attendance must occur, including any technological requirements.” Resolution 5421 establishes the procedures and criteria. These include establishing the foundation that City Commissioner are expected to attend meetings in person. The Resolution then establishes the process for requesting and approving remote attendance, the circumstances under 191 which remote attendance may be authorized, and the manner in which the remote attendance must occur including items such as ensuring the remote commissioner can see and hear what is occurring in the meeting room and that other commissioners and members of the public can see and hear the remote commissioner. The Resolution as proposed recognizes a current Commission rule requires a quorum of three Commissioners and requires a quorum be present in the room. The Resolution also authorizes remote participation for members of city boards under the same standards with specific approval and noticing procedures. UNRESOLVED ISSUES:City staff is in the process of developing technological solutions to implement this policy. At this time, it is uncertain as to how much the solutions will cost or when they may be deployed. Until the solutions are deployed, remote participation is not possible. In addition, prior to authorizing a board, committee, or agency, to allow remote participation by a member, City staff must be trained on procedures and any new technology necessary to implement the policy. ALTERNATIVES:As determined by the Commission. FISCAL EFFECTS:City staff are working to determine whether new technology must be purchased. As of publication, City staff are not able to determine the costs associated with this policy. Attachments: Ordinance 2118 Remote Participation 6122 gs.pdf Resolution 5421 Remote Participation 6122 gs.pdf Report compiled on: June 2, 2022 192 Ord 2118 Page 1 of 4 ORDINANCE 2118 AN ORDINANCE OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA AMENDING SECTION 2.02.110, BOZEMAN MUNICIPAL CODE, TO AUTHORIZE THE CITY COMMISSION TO ADOPT PROCEDURES AUTHORIZING REMOTE ATTENDANCE BY MEMBERS OF THE COMMISSION AND CITY BOARDS AT PUBLIC MEETINGS. WHEREAS, pursuant to 2-3-103, MCA, and the Montana Constitution, the City of Bozeman must establish procedures for permitting and encouraging the public to participate in decisions of the City Commission and of the City’s boards, committees, or agencies that are of significant interest to the public; and WHEREAS, the City has adopted such procedures through Chapter 2, Article 2, Bozeman Municipal Code, among others; and WHEREAS, the Commission desires to adopt procedures to authorize members of the commission and the City’s boards, committees, and agencies to participate remotely under specific circumstances and conditions while ensuring such remote participation fulfills the City’s obligation to permit and encourage public participation. NOW THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA: Section 1 That section 2.02.110, BMC shall be amended to read as follows: Sec. 2.02.110. Open meetings, remote meetings, and email. A. Except for properly called executive sessions as permitted by state law, all meetings of the city commission must shall be open to the public and media, freely subject to recording 193 Ordinance No. 2118 (Authorizing the Establishment of Procedures for Remote Attendance) Page 2 of 4 by radio, television and photography at any time, provided that such arrangements do not interfere with the orderly conduct of the meetings. B. The city commission may by resolution adopt procedures authorizing remote attendance by commissioners at public meetings. Such rules must establish procedures and criteria for when a commissioner may participate remotely and the manner in which remote participation must occur, including any technological requirements. The commission may by resolution authorize remote attendance by members of city boards. C. A majority of the commission shall not conduct synchronized email discussions involving a matter over which the commission has supervision, control, jurisdiction, or advisory power. Synchronized email discussions are email exchanges among three or more commissioners within minutes of each other that create the quality of simultaneity similar to instant messaging or chat room discussions. Such discussions are characterized as an active exchange of information rather than the passive receipt of information. An example of synchronized email discussion would be three commissioners sitting at their computers and instantly exchanging emails concerning city business, whereas a passive receipt of information is where a commissioner receives an email and responds in the normal course of time similar to responding by letter received in the mail. The commission shall not view emails or other electronic communication mechanisms concerning any matter on the agenda during a city commission meeting unless the submission is part of a specifically approved and adopted electronic public testimony program. Electronic communication mechanisms include text messaging or any other emerging technology that violates the spirit of open meeting laws. This does not preclude viewing emails or electronic communication mechanisms that were received prior to the commission meeting. Emails received by commissioners concerning an agenda item shall be forwarded to the city clerk and retained in accordance with the city's retention policy. Section 2 Repealer. All provisions of the ordinances of the City of Bozeman in conflict with the provisions of this ordinance are, and the same are hereby, repealed and all other provisions of the ordinances of the City of Bozeman not in conflict with the provisions of this ordinance shall remain in full force and effect. 194 Ordinance No. 2118 (Authorizing the Establishment of Procedures for Remote Attendance) Page 3 of 4 Section 3 Savings Provision. This ordinance does not affect the rights and duties that matured, penalties that were incurred or proceedings that were begun before the effective date of this ordinance. All other provisions of the Bozeman Municipal Code not amended by this Ordinance shall remain in full force and effect. Section 4 Severability. That should any sentence, paragraph, subdivision, clause, phrase or section of this ordinance be adjudged or held to be unconstitutional, illegal, or invalid, the same shall not affect the validity of this ordinance as a whole, or any part or provision thereof, other than the part so decided to be invalid, illegal or unconstitutional, and shall not affect the validity of the Bozeman Municipal Code as a whole. Section 5 Codification. This Ordinance shall be codified as indicated in Section 1. Section 6 Effective Date. This ordinance shall be in full force and effect thirty (30) days after final adoption. 195 Ordinance No. 2118 (Authorizing the Establishment of Procedures for Remote Attendance) Page 4 of 4 PROVISIONALLY ADOPTED by the City Commission of the City of Bozeman, Montana, on first reading at a regular session held on the _____ day of ________________, 2022. ____________________________________ CYNTHIA L. ANDRUS Mayor ATTEST: ____________________________________ MIKE MAAS City Clerk FINALLY PASSED, ADOPTED AND APPROVED by the City Commission of the City of Bozeman, Montana on second reading at a regular session thereof held on the ___ of ____________________, 20__. The effective date of this ordinance is __________, __, 20__. _________________________________ CYNTHIA L. ANDRUS Mayor ATTEST: _______________________________ MIKE MAAS City Clerk APPROVED AS TO FORM: _________________________________ GREG SULLIVAN City Attorney 196 Version April 2020 Resolution 5421 Page 1 of 4 RESOLUTION 5421 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA, ESTABLISHING PROCEDURES AND CRITERIA FOR WHEN A CITY COMMISSIONER OR MEMBER OF A CITY BOARD, AGENCY, OR COMMITTEE MAY PARTICIPATE REMOTELY IN A PUBLIC MEETING. WHEREAS, pursuant to 2-3-103, MCA, and the Montana Constitution, the City of Bozeman must establish procedures for permitting and encouraging the public to participate in decisions of the City Commission and of the City’s boards, committees, or agencies that are of significant interest to the public; and WHEREAS, the City has adopted such procedures through Chapter 2, Article 2, Bozeman Municipal Code, among others; and WHEREAS, the Commission desires to adopt procedures to authorize members of the commission and the City’s boards, committees, and agencies to participate remotely under specific circumstances and conditions while ensuring such remote participation fulfills the City’s obligation to permit and encourage public participation. NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of Bozeman, Montana, to wit: Pursuant to 2.02.110, BMC, the City Commission hereby establishes the following criteria that must be met and procedures that must be followed to authorize a commissioner or a member of a City board, agency, or committee to attend a public meeting through remote participation. Whenever this policy refers to a city commissioner the same criteria and procedures apply to members of City boards, agencies and committees unless a specific standard applies. 1. Remote participation may be available only upon a determination by the City Manager that the City has the technological and administrative capacity to support remote participation. 2. City commissioners are expected to attend meetings in person. 197 Version April 2020 Resolution 5421 Page 2 of 4 3. Remote participation means attendance by a city commissioner at any meeting of the city commission through the use of technology such as a video meeting software application. 4. Remote participation may be authorized by the presiding officer or by three commissioners not including the commissioner requesting to participate remotely. 5. Pursuant to 2.02.090, BMC, a quorum of the commission consists of three commissioners. For a commissioner to participate remotely, a quorum of the commission must be physically present in the meeting room. 6. A commissioner seeking to participate in a meeting remotely must use best efforts to submit their request to the presiding officer, city manager, and city clerk at least 24 hours prior to the start of the meeting. 7. Remote participation may be authorized only under the following circumstances: a. A health condition applicable to the commissioner or a person in the commissioner’s care; b. A urgent community circumstance; or c. Business or other personal circumstances limiting the commissioner’s ability to participate in-person. 8. The Commissioner participating remotely must ensure the equipment and technology the commissioner uses meets the following: a. Each member of the commission and the public (including those in-person and attending remotely) must be able to adequately see and hear the commissioner participating remotely; b. The commissioner participating remotely must be able to adequately see and hear the other commissioners, City staff, and the public; c. The commissioner participating remotely must be able to reasonably observe all materials reviewed and discussed by the commission during the meeting; and d. The commissioner participating remotely must ensure they have a suitable location from which to participate and must ensure they do not communicate with others not in the meeting regarding matters on the agenda. 9. Telephonic participation is not authorized; however, a commissioner may be authorized to participate by telephone if during the meeting the video software application fails. 10. A commissioner may be authorized to participate remotely pursuant to any single request for no more than two consecutive meetings. A commissioner must submit a subsequent request to participate remotely for any additional meetings but in no case may a 198 Version April 2020 Resolution 5421 Page 3 of 4 commissioner be authorized to participate remotely for more than four (4) meetings in any calendar year. 11. This policy does not authorize the City to conduct public meetings of the city commission or of a city board, agency or committee wherein the public’s only means of participation in the meeting is through remote methods. If a meeting is to occur limiting the public to only remote participation, such a decision may be made only upon a determination that public health or safety necessitates a fully remote meeting. For the city commission such a decision may be made by the presiding officer. For boards such a decision may be made by the city manager. 12. The commission hereby authorizes remote participation by members of city boards and agencies where the majority of members are appointed by the City. Prior to a board member participating remotely the City Manager must approve the board having access to remote participation. In addition: a. A quorum of the board must be in person. b. Determinations of whether a board member can participate in a meeting remotely may be made only by the chair. c. The board member seeking to participate remotely must use best efforts to notify the city clerk, the chair, the commission liaison, and the staff liaison at least 24 hours prior to the start of the meeting. 199 Version April 2020 Resolution 5421 Page 4 of 4 PASSED, ADOPTED, AND APPROVED by the City Commission of the City of Bozeman, Montana, at a regular session thereof held on the _____ day of ________, 2022. ___________________________________ CYNTHIA L. ANDRUS Mayor ATTEST: ___________________________________ MIKE MAAS City Clerk APPROVED AS TO FORM: ___________________________________ GREG SULLIVAN City Attorney 200 Memorandum REPORT TO:City Commission FROM:Emily Cope, Economic Development Director- Downtown Bozeman Partnership SUBJECT:Downtown Business Improvement District Fiscal Year 2023 Budget and Work Plan MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Finance RECOMMENDATION:Approve Downtown Business Improvement District Fiscal Year 2023 Budget and Work Plan STRATEGIC PLAN:4.4 Vibrant Downtown, Districts & Centers: Promote a healthy, vibrant Downtown, Midtown, and other commercial districts and neighborhood centers – including higher densities and intensification of use in these key areas. BACKGROUND:The Downtown Bozeman Partnership administers the Downtown Business Improvement District (BID) on behalf of the City of Bozeman. The Downtown BID Board, as appointed by the City Commission, directs the programs, projects and initiatives of the Downtown BID. MCA 7-12-1131 guides the programs, projects and initiatives of the Downtown BID. The Downtown BID Board took formal action to approve the FY2023 work plan and budget at their monthly public board meeting on May 18, 2022. The Downtown BID proposes a work plan and budget for approval by the City Commission during public hearings on the proposed City budget on an annual basis as required by statute. UNRESOLVED ISSUES:None. ALTERNATIVES:None. FISCAL EFFECTS:The Downtown BID is funded by the special assessments collected from property owners within the district. The BID assessment for FY2023 will be $220,000 as approved by the board at the May 18, 2022 board meeting. The BID will also receive approximately $50,350 in additional revenue from sponsorships and contracts. Total FY23 revenues are budgeted as approximately $270,350. The FY23 budget expenses are estimated to be $268,750. Attachments: 201 FY2023 BID Work Plan and Budget.pdf Report compiled on: June 6, 2022 202 Downtown Business Improvement District FY2023 BID Work Plan and Budget BID Mission Statement The BID is an organization of downtown property owners who through thoughtful, pro-active collaboration and partnership with local government, business owners, residents and citizens strive to create a shared vision and voice for the community of downtown Bozeman. The BID will commit resources, identify, plan and act on short- term and long-term initiatives otherwise unavailable to individual owners. The BID has a goal of ensuring the long-term preservation and vitality of the city’s underlying economic, cultural, social and environmental assets and the BID will work together to keep our downtown a safe, beautiful and vibrant place. BID Assessment Programs The following programs are funded by the special assessments collected from property owners within the Business Improvement District. The BID assessment for FY2023 will be $220,000. The BID will also receive approximately $50,350 in additional revenue from sponsorships and maintenance contracts. Downtown Bozeman Partnership ($63,000) The BID is a member of the Downtown Bozeman Partnership. The BID contributes to the administration of the Downtown Partnership office located at 222 East Main Street. Downtown Bozeman Association ($27,000) The BID contributes to the DBA to support its events, staff and marketing efforts to promote downtown. The DBA hosts events downtown that include Art Walks, Christmas Stroll, Music on Main, Crazy Days, Cruisin’ on Main Car Show, Restaurant Week and more. New Program/Outreach Bozeman ($20,000) The new program could be sidewalk pressure washing, public art project or another as needs arise for the district. HRDC utilizes a street outreach team approach to reach individuals and families experiencing homelessness. Since the beginning of the DBP Street Outreach program, HRDC has increased staff, capacity, resources and trainings to better serve, not just the downtown business community, but the entirety of Bozeman. Summer Flowers ($30,000) The BID purchases, installs and maintains (which includes watering 7 days a week) 300+ hanging baskets of Super- Petunias. In summer of 2022, 40+ additional hanging baskets will be placed on Babcock and Mendenhall. These flower baskets are hung throughout downtown from June through September on the historic lamp posts. 203 Holiday Lighting ($5,500) The BID installs the following holiday lighting downtown: 1) lighted garland on each historic lamp post along Main Street; 2) lights on the large conifer trees in Soroptomist Park; 3) garland wreaths at the Rouse, Church, Wallace, and Grand intersections; and 4) the infamous holiday “spider” decoration above four downtown intersections. Maintenance Program ($92,575) The BID hires two full-time maintenance employees in addition to two part-time maintenance employees for the summer months. Primary tasks performed by the BID maintenance staff includes garbage collection, flower watering, tree watering, Soroptomist Park upkeep, installation of the light pole banners, maintenance of pedestrian benches, graffiti removal, and limited snow removal. The BID maintenance staff removed over 4,200 bags of garbage and recycling during the past year from over 100 receptacles. Graffiti Removal Program ($5,750) The BID comprehensive graffiti removal program is in its third year of operation. Since 2009, this program has removed 4,000 graffiti tags. The BID maintenance staff removes tags from public property and works with property owners to clean private buildings of graffiti. The BID will continue to actively remove new tags as quickly as possible considering immediate removal has proven to be the most effective deterrent. 204 Downtown Banners ($3,000) The BID purchases, installs and maintains the downtown light pole banners. Seasonally the BID installs banners for MSU, Bozeman Farmers Market, Bridger Bowl, Big Sky Resort, Sweet Pea, SLAM, BYEP, Bozeman Health, Bridgercare, Greater Yellowstone Coalition and more. Tree Replacement ($2,000) The BID replaces trees that have died in the downtown district. In coordination with the City Forestry Division, dead trees are removed and then replaced by a local nursery. Smaller newly planted trees are susceptible due to physical damage and insufficient water. The BID replaces between two and six trees a year. Downtown Marketing ($2,500) The BID contributes to the general marketing of downtown Bozeman. These funds are made available to the Downtown Partnership which places advertisements in ten to twelve local, regional and state-wide publications. Vehicle Maintenance ($9,750) The BID owns and maintains a maintenance truck and two mules/ATVs. Maintenance Supplies ($6,375) The BID purchases a wide variety of maintenance supplies for various programs, including trash bags. 205 FY23 BUDGET Income BID Assessment 220,000$ BID Assessment--residual Contract Income 24,000$ Interest Income 100$ Mobile Vending Fees 1,750$ Flower Sponsorships 9,000$ Christmas Light Sponsorships 3,500$ Streetlamp Banners 12,000$ Total Income 270,350$ Expenses Management Fee 63,000$ Total Expenses 63,000$ Payroll Expenses Maintenance Staff 60,000$ Taxes 4,825$ Work Comp 3,300$ Maintenance Staff--Garage 22,500$ Taxes 975$ Work Comp 975$ Total Payroll Expenses 92,575$ Programs Outreach Bozeman/New Program 20,000$ Downtown Bozeman Association (DBA) Support 27,000$ Christmas Lights 2,000$ Christmas Light Spider Repair 2,000$ Christmas Lights Storage 1,500$ New Banners 3,000$ Flower Expenses 30,000$ Flower Water 300$ Tree Purchases 2,000$ Marketing 2,500$ Maintenance Supplies 3,750$ Garbage Bags 2,625$ Graffiti Supplies 1,250$ Graffiti Contracted Removal 4,500$ Mule Service & Fuel 1,750$ Truck Service & Fuel 2,500$ Vehicle Insurance 5,500$ Program Contingency 1,000$ Total Program Expenses 113,175$ Total BID Expenses 268,750$ NET ASSESSMENT INCOME 1,600$ 206 Memorandum REPORT TO:City Commission FROM:Ellie Staley, Executive Director Downtown Bozeman Partnership SUBJECT:Downtown Urban Renewal District Fiscal Year 2023 Budget and Work Plan MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Finance RECOMMENDATION:Approve Downtown Urban Renewal District Fiscal Year 2023 Budget and Work Plan STRATEGIC PLAN:4.4 Vibrant Downtown, Districts & Centers: Promote a healthy, vibrant Downtown, Midtown, and other commercial districts and neighborhood centers – including higher densities and intensification of use in these key areas. BACKGROUND:The Downtown Bozeman Partnership administers the Downtown Urban Renewal District on behalf of the City of Bozeman. The Downtown Urban Renewal District Board, as appointed by the Mayor and City Commission, directs the programs, projects and initiatives of the Downtown URD. The 1995 Downtown Urban Renewal Plan and 2019 Downtown Bozeman Improvement Plan, as adopted by the City Commission, guides the programs, projects and initiatives of the Downtown URD. The Downtown URD Board took formal action to approve the FY2022 work plan and budget at their public board meeting on May 17, 2022. The Downtown URD presents an annual report for last year and proposes the next year’s work plan and budget for approval by the City Commission during public hearings as required by statute. UNRESOLVED ISSUES:None. ALTERNATIVES:None. FISCAL EFFECTS:The Downtown URD anticipates a FY22 year-end balance of $4.3 million and FY23 revenues are projected to be $1.9 million which totals just under $6.2 million of funding available for FY23. The proposed FY23 expenditures total $4.79 million with an estimated FY23 year-end balance of $1.37 million. Attachments: FY2023 URD Work Plan-Budget.pdf Report compiled on: June 6, 2022 207 208 Downtown Urban Renewal District FY2023 Work Plan and Budget Downtown URD Mission Statement The Downtown Bozeman Urban Renewal District board (URD) will foster an economically thriving district that: 1)attracts investment; 2) stabilizes and strengthens the tax base; and 3) supports the vitality and diversity of the Gallatin Valley as its social and cultural center. In 1995, the City Commission adopted the Urban Renewal Plan for downtown Bozeman which was subsequently amended in 2015. The intent and purpose of the Urban Renewal Plan emphasizes: 1.Bozeman’s historical character as a “working” downtown shall be maintained. 2.Traffic movement and access shall be designed with the emphasis on the downtown as a designation rather than improving the flow of through traffic. 3.The facilitation of private/public partnerships is encouraged in the implementation of the Plan. 4.Objectives shall be accomplished by incentives whenever possible. 5.Private property rights will be respected. 6.Administrative practices shall be conducted in a constructive manner which fosters cooperation. 7.This Plan is further detailed, refined, prioritized and implemented by the “Downtown Improvement Plan” which outlines specific programs and projects consistent with the Urban Renewal Plan. The Urban Renewal Plan established nine “Guiding Principles” to provide direction for improving Bozeman’s historic downtown. The Urban Renewal Study Committee considered the first three principles more important than the next three with the last three the least important. However, the Committee deemed all nine principles to be vital to achieving the vision for downtown. Key implementation actions were identified for each principle (may apply to multiple principles but are only listed once below). 1.Strengthen downtown’s economic vitality 2.Improve the safety, security and health of the district 3.The image of downtown shall be continuously improved 4.Downtown’s accessibility shall be improved 5.“Community Partnership” is fundamental to downtown’s success 6.Downtown’s diversity shall be facilitated 7.The cost of projects and programs shall be weighed against their benefits 8.Downtown shall become more user friendly 9.Cultural activities shall be nurtured and expanded downtown Downtown URD FY23 Programs, Projects and Initiatives The Downtown URD anticipates a FY22 year-end balance of $4.3 million and FY23 revenues are projected to be $1.9 million which totals just under $6.2 million of funding available for FY23. The proposed FY23 expenditures total $4.79 million with an estimated FY23 year-end balance of $1.37 million. The following work plan and budget outline these projects and projected expenses. 209 Downtown Bozeman Partnership Management Fee ($203,500) 7% estimated increase over FY22. The increase is to cover inflation, increase to DBP rent (27% annual increase) and added staffing and bookkeeping needs. Street Furniture/Streetscape-new purchases ($50,000) Several new trash and recycling bins were purchased and placed in along newly developed streetscapes in FY22. Soroptimist Park also underwent a minor facelift with new fencing, hardscape and replanting summer of 2022. The need in FY23 has shifted to tree and tree grate updates. There are currently 11 trees that need to be pulled, grinded and replanted. The stumps are currently presenting a safety hazard. Five of the trees that need to be replaced is to large of a job for the city to complete and we looking to sign a PSA with Greenspace Landscaping at the City Commission meeting on May 24 for the work to be completed through summer 2022. We are also looking to purchase new benches for redeveloped sites and move into a planning stage for the next for Soroptimist Park. North Willson Streetscape Project ($75,000) This project is intended to complete the needed streetscape along the North Willson parking lot once Armory project was completed. This project was put on hold due to covid and lack of resources. We would like to reserve funding to complete the work needed in FY23, just along the city-owned area and to work with other property owners to complete the remaining areas in collaboration. URD Grant Programs – The URD grants have been updated to reflect current code updates and can now be completed online. Although, a substantial audit needs to be made to these to make sure they are still relevant to the needs of downtown developments and infrastructure improvement needs. After going to digital forms in 2022, a full audit continues to be a priority in FY23. The estimated costs below are dependent on applications received. •Streetscape Assistance ($50,000) •Life-safety Grant ($30,000) •Fiber Infrastructure Grant ($10,000) •Technical Assistance Grant ($50,000) •Residential Incentive Program ($200,000) Alley Improvements & Planning ($250,000) We are underway with the North Black to Tracy Alley Improvement Project. We have hired a project manager and a landscape design team. We have a 6 to 9-month pre-construction timeline. Civil surveying and landscaping plans will be completed this summer and alley improvement construction to happen spring 2023. We have rough estimates on cost and will have a clearer picture once we complete the necessary survey and planning needed. The final design will include a combination of public art, seasonal planters, pavement treatments, lighting, seating, and landscaping. Bozeman Creek Improvements & Planning ($20,000) An educational and artistic project that started in 2021, is slated to be completed in summer 2022. The estimated $20,000 has been approved for this project and we look forward to the final piece to be installed at city hall along the bridge and creek access point. These encumbered expenses may be paid on FY22 or FY23, depending on construction timeline. Bozeman Creek improvements has been a URD priority and although we do not have an additional project in the works for FY23, we’d like to reserve some funds for future planning with our current partners and have some flexibly to support future projects that may arise. 210 Wayfinding and Parking Signage Project ($25,000) This ranked as a top project on the URD board prioritization exercise to expand and clarify what amenities and parking are available. This was not completed in FY22 but will become more crucial in FY23 as visitor numbers rise and if a parking management program is installed. The cost will be an estimated $15,000 for fabrication and installation of signage, $10,000 for design and planning for the project. Intersection Cable Anchor Repairs ($25,000) Small cable repairs were made in FY22 and more are planned for FY23. These are ongoing and necessary upgrades, specifically as buildings get redeveloped on those specific corners. Alternative Transportation Projects $50,000 Not completed in FY22 but continues to be a priority in FY23. It’s intended to alternative transportation projects including bike & transit connections between downtown and key destinations, a bike share program, enhance bike and pedestrian links, enhance Black Avenue as Bozeman’s downtown bike hub. Workforce Housing Project – Fire Station One ($1,600,000) This is an encumbered expense approved for a project with 50 units of work force housing to be sold at 120% AMI. The $1.6 million approved for this project will be reimbursed at the certificate of occupancy and when all of the project conditions have been met. This will likely be reimbursed after FY23 but will be encumbered until paid or approved project changes. City Economic Development Specialist ($35,500) An estimated 7% increase from FY22 to cover inflation. This cost helps fund a portion of payroll expenses for two City Economic Development Department Specialists. These employees will work on a variety of tasks directly related to the downtown URD including parking and tax increment financing. Transportation Planning ($50,000) We are moving into the next phase of transportation planning and potentially short-term transportation infrastructure improvements through FY23. This includes a focus on pedestrian safety and downtown access along Mendenhall and Babcock. We are currently developing a scope with short- and long-term attainable solutions. Field surveys are currently being performed and we hope to confirm a professional services agreement for this work in the coming weeks and will keep the URD board abreast of the process throughout. Soroptimist Park Planning ($25,000) During the fall 2020 semester, the URD partnered with the CATS Program to envision options for transforming the park and they presented an array of creative ideas. The next step is to hire a professional firm/team to further the design concepts developed. Code Amendments ($20,000) This would include planning to include more code flexibility Downtown for existing and new buildings (departures, deviations, relaxations, etc.). As the Unified Development Code is slated to do a full amendment process, it will be important for us to have some funding for specific downtown planning to assistance through the city process. Design Guidelines/Standards ($25,000) It has been increasingly apparent as larger development projects expand throughout our district, that we need to develop a set of downtown design guidelines, to create and support consistent streetscape 211 enhancement and provide developers with the information they need to properly expand the efforts we have made to beautify and improve our district. We hope to begin this planning process in FY23. Downtown Infrastructure & Public Realm Plan ($50,000) To develop plan to enhance Downtown’s identity and ensure public realm developments create a consistent and sustainable environment, establish framework for near term infrastructure investments that incrementally build to long term vision, provide path for private investment, while leveraging limited resources. We would like to head into Phase 1 of this plan in FY23. The scope is currently being reviewed. Employee Paid Parking Permit System ($20,000) Continues to be a priority as our parking needs change. This could be used to help advertise any changes to the employee parking system, potentially off-set costs to employees for permitting or for other general implementation costs with a focus on assisting the businesses with any changes or concerns. Utility Infrastructure Improvements ($100,000) For utility infrastructure improvements within the URD district. Funding could be used towards poles, pipes, cables, wires, conduits, etc. This could be part of our formalized grant program in FY23. Structured Parking Site Plan, Bids ($1,250,000) As plans for the County Courthouse site progress, we hope to move into the site plan process. We have a preliminary estimate of $1.25 million based on the cost analysis done on the projected top sites. Streetscape Preliminary Engineering ($50,000) To update and continue planning to extend the streetscape to side streets, Babcock, and Mendenhall. This could also assist in the development of the design guidelines and standards project for future downtown development assistance that will include streetscape updates. 212 Downtown Urban Renewal District FY2023 Budget Category FY23 Budget Income Starting Cash Balance $4,263,910 Income from TIF $335,000 COB Interlocal Share $1,504,048 Entitlement Share State of Montana $58,761 Interest Income Other Income Total Income $6,161,719 Expenses Operations DBP Management Fee $203,500 Total Operations $203,500 Infrastructure Improvements Street Furniture and Park Maintenance $25,000 Streetscape--new purchases $25,000 North Willson Streetscape Project $75,000 Streetscape Assistance Grant Program $50,000 Alley Improvements $200,000 DBIP: Bozeman Creek Improvements $10,000 DBIP: Wayfinding & Parking Signage $15,000 Life-Safety Grant Program $30,000 Fiber-Broadband Infrastructure--Grants $10,000 Intersection Cable Anchor Repairs $25,000 Parklet $50,000 Alternative Transportation Projects $50,000 Workforce Housing Project - Fire Station One $1,600,000 Total Improvements $2,165,000 Planning City Economic Development Specialist $35,500 Technical Assistance Grants $50,000 Residential Incentive Program $200,000 DBIP: Transportation Planning $50,000 DBIP: Alley Planning $50,000 DBIP: Bozeman Creek Planning $10,000 DBIP: Soroptimist Park Planning $25,000 DBIP: Code Amendments $20,000 DBIP: Design Standards $25,000 DBIP: Downtown Infrastructure & Public Realm Plan $50,000 DBIP: General Implementation $50,000 DBIP: Employee Paid Parking Permit System $20,000 DBIP: Wayfinding Plan & Parking Signage $25,000 Utility Infrastructure Improvements $100,000 Structured Parking Informal, Site Plan, Bids $1,250,000 Professional Services Term Contract $75,000 Streetscape Preliminary Engineering $50,000 Total Planning $2,085,500 Parking Structure Garage Bond Payment $335,000Total Parking Garage Payments $335,000 Total Expenses $4,789,000 Balance $1,372,719 DURD FY23 Budget 213 The FY2023 Downtown Urban Renewal District Work Plan and Budget was unanimously approved by the URD Board on May 17, 2022. Prepared and submitted by: Ellie Staley, Executive Director Downtown Bozeman Partnership 222 East Main Street #302 Bozeman MT 59715 ellie@downtownbozeman.org 406-586-4008 214 Memorandum REPORT TO:City Commission FROM:David Fine, Economic Development Program Manager Brit Fontenot, Economic Development Director SUBJECT:Midtown Urban Renewal District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Finance RECOMMENDATION:I move to approve the Midtown Urban Renewal District Fiscal Year 2023 Work Plan and Budget. STRATEGIC PLAN:2.2 Infrastructure Investments: Strategically invest in infrastructure as a mechanism to encourage economic development. BACKGROUND:The Midtown Urban Renewal Board unanimously voted to recommend the attached Work Plan and Budget for Fiscal Year 2023. The Board is recommending four infrastructure investments: Improvements to the Westlake Park that are continuing from FY22, codification of design standards for the N. 7th Ave. streetscape, the construction of a multi-use path along N. 5th Ave. between Oak St. and Tamarack St., and modifications to the festival street lighting on W. Aspen St. The Board is also recommending the appropriation of $3 million to be spent on workforce housing projects through future development agreements. Funding for standard programs and administration remains similar to last fiscal year. Please see the Midtown Urban Renewal District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report. UNRESOLVED ISSUES:None at this time. ALTERNATIVES:As recommended by the City Commission. FISCAL EFFECTS:The proposed Work Plan and Budget for Fiscal Year 2023 appropriates $4,489,541 from the Midtown Urban Renewal District Tax Increment Fund. Attachments: Midtown Budget FY 2023 FINAL.pdf Fiscal Year 2023 Midtown Work Plan and Budget and Annual Report Final.pdf 215 Report compiled on: June 3, 2022 216 Bozeman Midtown Urban Renewal Board Fiscal Year 2023 Work Plan and Budget Revenue and Reserves Undesignated Fund Balance $3,026,064 Estimated FY22 Ending Balance $448,000 Estimated FY23 Revenue $1,076,082 Total Cash and Reserves $4,550,146 Infrastructure Investments Westlake BMX Park Improvements $293,641 Codify Design Standards for N. 7th Avenue Streetscape $50,000 5th Ave Trail $191,000 Festival Street Lighting extensions, fabrication and installation $100,000 Bond Repayment Series 2020 $410,000 Professional Services and Outside Legal Counsel Outside Legal Counsel for Bonding and Redevelopment Agreements $60,000 Contracted Professional Services $60,000 Redevelopment Incentive Programs Technical Assistance Grants 1:1 match [2 grants]$15,000 Direct Incentives - Midtown TIF Assistance Program $100,000 City Fiber Conduit Connection Incentive Program $20,000 Outreach and Marketing Outreach Engagement and Mailing $10,000 Midtown Marketing and Recruitment $10,000 District Operations Payroll $97,900 Training $12,000 General Administrative Costs $20,000 Approved Grants and Direct Incentives Workforce Housing Project (9TEN)$3,000,000 El Mercadito $40,000 TOTAL EXPENDITURES $4,489,541 Year End Balance $60,605 217 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Midtown Urban Renewal Board Annual Work Plan and Budget FY2023 Page 1 of 9 MIDTOWN URBAN RENEWAL DISTRICT FY2022 ANNUAL REPORT and FY2023 WORK PLAN AND BUDGET The City Commission passed Ordinance No. 1685, “Adopting an Urban Renewal Plan for the North Seventh Avenue Corridor and Adjacent Properties”, on November 27, 2006. On December 16, 2015, the City Commission passed Ordinance No. 1925, which adopted a new urban renewal plan, expanded the boundaries of the original district, and renamed the North Seventh Urban Renewal District the Bozeman Midtown Urban Renewal District. The 2015 Midtown Urban Renewal Plan provides for the remediation of blighted conditions within the urban renewal area by advancing five broad goals through a series of implementing activities and strategies. The five goals include the following items: 1. Promote Economic Development  Rationale: Economic vitality strengthens the community, provides for physical needs of the citizens, opens reinvestment opportunities, and helps to eliminate the conditions that contribute to blight. 2. Improve Multimodal Transportation  Rationale: Increasing travel options supports public health, reduces resource demand, increases efficiency and reduces costs, improving the quality of life and making the community a better place to live and work, helping to eliminate conditions that contribute to blight. 3. Improve, Maintain and Support Innovation Infrastructure  Rationale: Infrastructure is the backbone of the community. Private development typically requires a corresponding public investment in infrastructure. Therefore, capital improvements in the district will help achieve economic vitality and address conditions that contribute to blight. 4. Promote Unified, Human Scale Urban Design  Rationale: Protecting and building upon existing physical assets increases vitality, desirability and leverages economic development, strengthening community values and mutual support helping to eliminate the conditions that contribute to blight. 5. Support Compatible Urban Density Mixed Land Uses  Rationale: A sense of place is strengthened by a strong core identity. Increasing live-work opportunities and community interaction, ensures that the North 7th Avenue area remains a great place to live, work, operate a business, and play, and helps to eliminate conditions that contribute to blight. 218 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Midtown Urban Renewal Board Annual Work Plan and Budget FY2023 Page 2 of 9 The City Commission approved the Midtown Action Plan in 2017, which charted a new direction in pairing infrastructure spending and blight remediation with proposed private investment. The intent of the Action Plan is to, “attract targeted private investment by leveraging the market potential of the Midtown District and removing barriers to redevelopment through strategic infrastructure investments and incentives.” The Annual Report and the recommended Work Plan and Budget reflect this specific strategy and approach to using private investment to propel blight remediation and urban renewal. The Midtown Action Plan proposes targeting future development that includes the following elements:  Infill. The intent of urban renewal is to remove blight to improve an area for the entire community benefit. Remodeling of existing structures or infill of underutilized lots is the priority of this Plan. As discussed, infill development is more challenging than vacant greenfield development and warrants focused investment of staff time and resources.  Increased building density. Increased building density increases the number of people in the District, which helps create the desired active pedestrian environment. More density of buildings grouped together in districts is especially desired to encourage pedestrians to explore adjacent buildings. Buildings that are separated by large parking area or vacant lots will impede pedestrian movement.  Encourages multimodal transportation. New projects should provide amenities such as adequate bike parking or bus schedule real time monitors in lobbies. At the same time, the Urban Renewal District should invest in infrastructure projects such as bike lanes and signals or covered bus stops to make alternative transportation options visible, safe, and desirable.  Retail that serves surrounding residents. To achieve a more vibrant pedestrian-oriented environment the District must consist of uses that are a frequent destination by residents. Retail amenities that are experience based such as restaurants or ice creams shops are desired because they generate activity and are more resilient to emerging ecommerce trends. Such amenities will also attract more housing investment.  Housing. Bozeman is in significant need of all types of housing, therefore it is called out as a specific use that is desired. The Midtown District zoning is intended to accommodate more dense housing projects with potential access to retail amenities nearby. The City Commission funded a package of several major infrastructure improvements in the District through the approval of $6,500,000 in bonds with a 25 year term on July 6, 2020. The infrastructure improvements include the streetscape infrastructure on N. 7th Ave. that enhances the walkability, aesthetics, and investment potential of the District as a whole, along with improvements to Aspen St. and N. 5th Ave. that will accelerate ongoing private investment in this emerging node of commercial activity. The District is also focused on investing in public infrastructure that removes barriers to specific private investments. These incentives primarily pay for the costs of public infrastructure associated with the private projects, as well as demolition costs and the cost of 219 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Midtown Urban Renewal Board Annual Work Plan and Budget FY2023 Page 3 of 9 various system development charges, such as impact fees. These early investments in projects will create new incremental taxable value that will allow for greater blight remediation throughout the District in the coming years. Over time, these increases in taxable value will benefit the broader community by increasing the overall tax base through productive infill development. The remediation of blighted conditions in the District and its ongoing redevelopment will take many years. Bozeman has 23 more years to focus on redevelopment of the Midtown area. As instructed by Commission adopted policy documents, the District will continue to focus on remediating blight, by attracting targeted private investment and growing the tax base. 220 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Midtown Urban Renewal Board Annual Work Plan and Budget FY2023 Page 4 of 9 Midtown Urban Renewal District (MURD) FY2022 Annual Report (July 1, 2021 to June 30, 2022) Highlights of investments over $15,000 are documented below. Series 2020 Bond Payment $410,000 The City Commission approved the first series of bonds for the district for $6,500,000. The proceeds of the bonds were to pay for the N. 7th Ave. Streetscape Project and the Aspen and 5th Improvements Project. The term of the bonds is 25 years. Midtown Infrastructure Improvements Urban Renewal Project $358,917 The Midtown Infrastructure Improvements Project includes several sets of public infrastructure improvements throughout the District. Expenditures on this project in Fiscal Year 2022 included completion of the N. 7th Streetscape Project between Durston Rd. and Mendenhall St. and the reconstruction of Short St., adjacent to the ELM event center to address stormwater, and ADA issues. In addition, this project included upgrades to the streetscape along N. 7th Ave., adjacent to the Ruh Building to ensure the streetscape matched the style of the recently installed elements. The Ruh Building (encumbered from FY21) $ 747,500 The Ruh Building is proposed as a 34,066 SF, 3-story, mixed-use building with restaurant/retail uses on the ground floor and 16 residential units on the upper floors. The project is located at the northwest corner of N. 7th Ave. and Durston Rd. The City Commission approved the project as an urban renewal project pursuant to Resolution 4991 following a public hearing at its February 11, 2019 meeting. The project represents a $6,676,667 investment in the District. The Ruh Building Streetscape $ 103,737 The Board recommends approval of a forthcoming amendment to the existing grant agreement for The Ruh Building. At staff’s urging, the Developer modified their site plan to make sure the streetscape elements matched those on the remainder of the corridor. In addition the Montana Department of Transportation (MDT) is widening the intersection of N. 7th Ave and Durston Rd. and the new design is configured to be able to remain in place with the widening project. Aspen Crossing (encumbered from FY21) $ 849,959 Aspen Crossing is a 65,000 square foot, 3-story, mixed-use building with restaurant/retail uses on the ground floor, second floor offices, and 25 residential units on the upper floor. The project represents at least a $13,029,045 in the District. Zambon Building (encumbered from FY21) $ 45,000 The project represents a $2,941,000 investment in the District and approximately 10,000 SF of commercial space. Staff expects this item will be requested for payment before the end of FY 2022, but may also occur in early 2023. 221 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Midtown Urban Renewal Board Annual Work Plan and Budget FY2023 Page 5 of 9 West Peach Condos (encumbered from FY21) $ 256,355 The West Peach Condos project is comprised of 17 two bedroom, one office, three bathroom, and two car garage, townhouse-style condominium units. The project is located at the northwest corner of N. 3rd Ave. and W. Peach St. The City Commission approved the project as an urban renewal project pursuant to Resolution 5046 following a public hearing at its May 20, 2019 meeting. The project represents a $7,656,246 investment in the District. El Mercadito $40,000 Through adaptive reuse of an existing vacant structure at 511 W. Mendenhall St., El Mercadito proposes renovations to the interior of the building, to the exterior façade, the addition of landscaping, outdoor seating, and electrical utility upgrades. The building will house a Hispanic food market and fast-casual dining space and second location for El Mercadito LLC., whose business in Four Corners has grown and is expected to continue to thrive in a more urban, pedestrian-oriented location. The grant funds three blocks of neighborhood electrical infrastructure upgrades that were necessary to allow for a commercial kitchen in this commercially-zoned location. Staff expects this project could receive reimbursement this fiscal year, but the project could extend into FY 2023. Westlake Park Improvements $39,359 The Parks Department oversaw completion of a new start gate and associated concrete work for the BMX track at the park. The new gate is expected to reduce noise and increase safety for races. Relocation and reconstruction of the mountain bike course is expected to be completed in FY 2023. Streetscape Operations and Maintenance Manual $8,000 The new streetscape will require regular maintenance. This item would allow the designer to create a manual to make sure long-term care and maintenance of the recently installed facilities is properly documented. Expenditures Compiled May 16, 2022 222 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Midtown Urban Renewal Board Annual Work Plan and Budget FY2023 Page 6 of 9 Midtown Urban Renewal District (MURD) FY2023 Work Plan (July 1, 2022 to June 30, 2023) Midtown Infrastructure Improvements Westlake Park Improvements $318,641 The District paid to add back-in angle parking to serve as parking for Westlake Park as part of last year’s improvements to N. 5th Ave. The project significantly impacted the mountain bike facilities manage by Southwest Montana Mountain Bike Association (SWMMBA). A recently update park master plan calls for relocating the mountain bike facilities and building an entrance plaza near the intersection of N. 5th Ave. and the recently complete Aspen Festival Street. The improvements would also include a new, quiet electric start gate for the BMX course, which will allow for much quieter operations and an improved racing experience. The District spent $39,359 on BMX track related elements of this project in FY 2022. Codify Design Standards for N. 7th Ave. Streetscape $50,000 Recent improvements to the N. 7th Ave. streetscape are not currently required for redevelopment projects on the corridor. In order to protect the public investments already made and to ensure design continuity for the corridor, codifying the streetscape design is necessary for the future development of the corridor. This project is continuing FY 2023. N. 5th Ave. Multi-Use Path $200,000 Staff obtained an easement to install a 10ft paved multi-use path along the N. 5th Ave. right-of-way to connect the path on Oak St. to Westlake Park and to provide bike and pedestrian connectivity where N. 5th Ave. does not currently exist. Festival Street Lighting extensions $ 100,000 This project adapts the recently installed light poles and string lights on W. Aspen St. to make them compliant with the National Electrical Code and “Night Skies” ordinance. Bond Repayment Series 2020 $ 410,000 The City Commission approved the Series 2020 bonds for a 25 year term that ends 2045. $410,000 is the annual payment on the $6,500,000 in debt issued to finance the cost of the N. 7th Ave. Streetscape Project, and the Aspen and N. 5th Ave. Improvements Project. Professional Services and Outside Legal Counsel Contracted Professional Services $ 60,000 223 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Midtown Urban Renewal Board Annual Work Plan and Budget FY2023 Page 7 of 9 To assist with district management and implementation of the work plan and budget, as well as responding to new opportunities, Staff will contract for services on an as-needed basis. Outside Legal Counsel $ 60,000 The Midtown Urban Renewal District continues to see strong interest in redevelopment. This interest will necessitate work on development agreements under the Midtown TIF Assistance Program, and depending on the scope of the projects, the need to issue additional bonds. Redevelopment Incentive Programs The Midtown Urban Renewal District’s redevelopment incentive programs are based on criteria included in the 2015 Midtown Urban Renewal District Plan and the 2017 Midtown Action Plan. Technical Assistance Grants (TAG) $ 15,000 This program is to provide technical assistance funding to encourage developers to build on parcels along the N. 7th Avenue corridor, or rehabilitate existing structures. It recognizes the complexities of redeveloping parcels which have existing substandard buildings and infrastructure; it was created to offset the costs of those complexities with grants for those proposing work which eliminates blight and advances the implementation of the District Plan. The program was approved by Resolution 4777 and is administered by the MURB. The maximum grant amount for the program is $7,500 and requires a 1:1 match. Midtown Tax Increment Finance Assistance Program – Direct Incentives $ 100,000 The City Commission approved an incentive program, the Midtown TIF Assistance Program pursuant to Resolution 4770 in 2017. Resolution 5087 reauthorized and updated the Program in 2019. Awards will be based on the quality of projects and their support of the Midtown Urban Renewal Plan. Projects of a larger magnitude may require the issuance of tax increment revenue bonds. Projects $50,000 and under may be awarded by the Board and sent to the City Commission as Consent Items. Projects over $50,000 require the approval of the City Commission. Fiber Conduit Connection Incentive Program $ 20,000 The District has made significant investments in facilitating competitive telecommunications options through the provision of public conduit. This program, modeled on a program created by the Downtown URD provides matching grants of up to $2,500 to connect buildings to the City conduit system. The program facilitates connections to infrastructure and the utilization of the existing conduit investment. 224 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Midtown Urban Renewal Board Annual Work Plan and Budget FY2023 Page 8 of 9 Outreach and Marketing Outreach and Mailing $ 10,000 The Board has requested money for public noticing and outreach activities in the District. The purpose of these outreach activities is to inform and engage property owners and the public in the implementation of the Midtown Urban Renewal Plan. Midtown Marketing and Recruitment $ 10,000 This item includes maintenance of the District website, midtownbozeman.org, as well as programs like the banner program to drive traffic to the website. The District uses the website to communicate effectively with property owners, developers, and the public and “to disseminate blight clearance and urban renewal information.” In addition, the board and staff continue to actively recruit development projects in the district that are in support of the urban renewal plan. District Operations Payroll $ 97,900 The City’s Economic Development Department manages the Bozeman Urban Renewal District in response to City Commission and the Midtown Urban Renewal Board work plans and policy guidance. 1.5 FTE are dedicated to staffing the Bozeman Urban Renewal Program as a whole, of which the Midtown URD contributes a proportionate share of funding. Training $ 12,000 Strong professional development drives the success of the urban renewal program. Staff plans to participate in the National Development Council’s Economic Development Finance Professional (EDFP) Certification Program and the International Economic Development Council’s (IEDC) certified economic developer course series over a number of years General Administrative Costs $ 20,000 This line item provides funding for the general and ordinary cost of running a successful program and allows the program to respond to opportunities and challenges during the year. 225 Bozeman Midtown Urban Renewal District An Urban Renewal District with a Tax Increment Financing (TIF) Program Midtown Urban Renewal Board Annual Work Plan and Budget FY2023 Page 9 of 9 Midtown Tax Increment Finance Assistance Program Approved Grants and Direct Incentives Workforce Housing (9TEN) $ 3,000,000 The project, as currently proposed, includes 100 units of housing. Forty units are deed restricted for at least 30 years and limited to prices that are affordable to households making 120% of the area median income (AMI). Forty units will be sold at prices that are affordable to households making 120% of the area median income (AMI), but will not be deed restricted beyond initial sale. The remaining 20 units will be offered at the market rate. The project also features 3000 SF of ground floor commercial space double fronting the corner of W. Aspen St. and N. 8th Ave. This project is currently on hold and the board would like to be able to use these funds on similar projects that would provide workforce housing within the District. 226 Memorandum REPORT TO:City Commission FROM:David Fine, Economic Development Program Manager Brit Fontenot, Economic Development Director SUBJECT:Northeast Urban Renewal District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Finance RECOMMENDATION:I move to approve the Northeast Urban Renewal District Fiscal Year 2023 Work Plan and Budget. STRATEGIC PLAN:2.2 Infrastructure Investments: Strategically invest in infrastructure as a mechanism to encourage economic development. BACKGROUND:The Northeast Urban Renewal Board unanimously approved the attached Fiscal Year 2023 Work Plan and Budget. Notable projects include the construction of a pedestrian bridge connecting E. Aspen St. to the trail, design of a pocket park in the N. Church right-of-way, and construction of a railroad quiet zone improvements on N. Wallace Ave. The budget also includes funding for design and due diligence related to a potential partnership for structured parking at the corner of Tamarack and Wallace as part of the Wallace Works project. Administrative costs remain similar to previous fiscal year with small increases to account for rising costs. Please see the attached Northeast Urban Renewal District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report. UNRESOLVED ISSUES:None at this time. ALTERNATIVES:At the suggestion of the City Commission. FISCAL EFFECTS:The proposed FY 2023 Work Plan and Budget includes $1,031,000 in requested appropriations from the Northeast Urban Renewal District tax increment fund. Attachments: 22-23 NURB Budget final.pdf FY23 NURB Work Plan FINAL.pdf Report compiled on: June 3, 2022 227 228 FY23 Budget Future Projects Revenues: Estimated Beginning Balance $750,000.00 FY21 Tax Increment $280,000.00 Delinquent Increment State Shared/Entitlement Interest $1,000.00 Total Estimated Revenues $1,031,000.00 Expenditures: Infrastructure Pedestrian Bridge/East Aspen Street Construction $170,000.00 Pocket park - North Church right-of-way design $25,000.00 Trails within district $200,000.00 Quiet Zone Construction $225,000.00 Connector trail - Depot trail to Audubon site $25,000.00 Public Art $10,000.00 Reimburse Wildlands public infrastructure $580,000.00 Parking Structure $50,000.00 Front Street - Ida to East Aspen Street Engineering $18,000.00 Front Street - Tamarack to Ida Construction $190,000.00 North Ida Avenue - Peach to Cottonwood Engineering $50,000.00 North Ida Avenue - Peach to Cottonwood Construction $280,000.00 Front Street - Ida to East Aspen Street Construction $100,000.00 Subtotal - Infrastructure $480,000.00 $1,443,000.00 Maintenance Trails/Boulevards/Alleyway Maintenance $12,000.00 Subtotal - Maintenance $12,000.00 Administration Staff Support $3,000.00 Administrative Services $19,800.00 Professional Services $10,000.00 Bond Repayment $93,000.00 Subtotal Administration $125,800.00 Reserves Designated Reserve - Bond $120,900.00 Designated Reserve - Projects $292,300.00 Subtotal Reserves $413,200.00 Total Expenditures $1,031,000.00 Northeast Urban Renewal District 2022-2023 Budget 229 Northeast Urban Renewal Board Annual Work Plan and Budget FY2023 1 NORTHEAST URBAN RENEWAL BOARD FY2022 ANNUAL REPORT and FY2023 WORK PLAN AND BUDGET On November 28, 2005, the Bozeman City Commission finally adopted Ordinance No. 1655 which formally enacted the Northeast Urban Renewal Plan and became effective December 28, 2005. The stated mission of the plan and general goals are as follows: DISTRICT PLAN MISSION/VISION “This Plan is the City’s response to remedy the conditions of blight found in the August 2005 [Blight] Report. The Plan also addresses other issues important to the District. The Plan’s purpose is to ensure the vitality of the Northeast Urban Renewal District (NURD) the vitality of the NURD for generations to come, and to make the NURD an area in which its citizens can take exceptional pride. The Plan envisions a mixed use neighborhood that is user friendly, safe, secure and healthy. While this Plan envisions a District with diversity of housing, businesses and amenities, it intends to maintain the unique ambiance and historic character of the District”. Nine principles were developed for the plan. Each of the principles has one or more goals associated with the plan, some of which specifically relate to this work plan while others represent general objectives and directives. The Northeast Urban Renewal Board (NURB) goals are as follows: GENERAL GOALS:  Outdated or insufficient infrastructure should be repaired, replaced, or otherwise improved.  Provide public utilities to the area efficiently in ways that are not visually or physically obtrusive.  Encourage a land use pattern that facilitates all modes of transportation – vehicular, bicycle, pedestrian, mass transit, and commercial – for safe, efficient and convenient access for residential, commercial, and industrial uses.  Harmonize commercial and industrial development with residential quality of life.  New structures should be designed and built keeping in mind the public values of durability, flexibility, and simplicity. Thoughtful consideration of design, materials, and massing in the construction of new private buildings will add strength and character to the built environment. To the degree that the private sector can be influenced by a public partner in development, the community ought to strongly encourage excellence in urban design as a basis of partnership.  Promote sustainable building practices and design within the district.  Procure new land for park and open space.  Improve landscaping in existing public spaces.  Neither the City of Bozeman nor any of its subdivisions shall use eminent domain to take private property for private use in the implementation of an urban renewal project or similar redevelopment plan.  Encourage the City to help ensure the success of the Northeast Urban Renewal Plan by giving a high priority to the Northeast District in its capital improvements plan.  Work with neighborhoods and businesses to ensure actions taken in the district are compatible with adjacent developed areas.  Work with the City to ensure actions taken outside of the District are compatible with projects inside of the District. 230 Northeast Urban Renewal Board Annual Work Plan and Budget FY2023 2 In 2010, the Northeast Urban Renewal Board began implementing plans and projects reflecting their three funding priorities: 1) Parks, Trails and Greenspace; 2) Infrastructure and 3) Neighborhood Development Plan. Northeast Urban Renewal District (NURB) FY2022 Annual Report (July 1, 2021 to June 30, 2022) Front Street – Ida to East Aspen Street Engineering $ 18,000 Due to the applicant’s decision to not proceed with the TinWorks Project, this engineering project was not pursued. Front Street – Tamarack to Ida Construction $ 190,000 Due to the applicant’s decision to not proceed with the TinWorks Project, this project was not pursued. Pedestrian Bridge/East Aspen Street $ 170,000 Due to the applicant’s decision not to proceed with the TinWorks Project, the Board agreed that this project should be moved forward from the future projects to this fiscal year. This project has been included in this district’s work plan and budget since Fiscal Year 2011. It was also the fifth project listed in the bond resolution adopted in 2017; however, those bond proceeds funded only the top two projects. The Board expressed its interest in construction of a bridge that is unique to the district rather than the typical bridge found in other locations. As a result, Ken VanDeWalle was retained to create an aesthetically pleasing design for the bridge which will be set on concrete abutments. Since engineering for this project was last completed in FY2017 and since the floodplain map has recently been updated, it was important to update the engineering to ensure the bridge has adequate length. Front Street connector trail $ 15,000 In Fiscal Year 2016, the Board donated $20,000 to the Gallatin Valley Land Trust for the Front Street connector trail, which extends from North Rouse Avenue to North Wallace Avenue. Due to a variety of issues, construction of the trail improvements was delayed. The monies were included in the FY2021 budget and work plan but were not expended and are, therefore, being carried forward in this budget. The connector trail was constructed during FY2022. Due to favorable bids and the lower costs, the Gallatin Valley Land Trust determined that these additional monies were not needed. Parking Structure due diligence $ 50,000 Even though the applicant for the TinWorks Planned Unit Development project has decided not to pursue the project, the Board recognizes the need for additional parking within the district and, as a result, has continued to monitor the progress of any potential proposal to construct a parking structure. Trails Maintenance $ 5,700 The Northeast Urban Renewal District completed improvements to the depot trail, depot park, Aspen Street trail and North Church Avenue trail several years ago and continues to pay annual costs for maintenance of those amenities. Also included is the weekly watering of seven newly 231 Northeast Urban Renewal Board Annual Work Plan and Budget FY2023 3 planted boulevard trees along East Tamarack Street to ensure their survival. Administrative Services $ 31,000 Costs covered under this item include staff support ($18,000), administrative services ($3,000) and professional services ($10,000). Bond Costs $ 213,900 Costs covered under this item include bond repayment ($93,000) and designated bond reserve ($120,900). These are static costs for the bonds that were issued in 2017 and must be budgeted through Fiscal Year 2042. Designated Reserve - Projects $ 117,400 At this time, it does not appear there will be adequate monies to fund construction of any additional large scale projects, so the monies were simply placed in reserve. Northeast Urban Renewal District (NURB) FY2023 Work Plan (July 1, 2022 to June 30, 2023) Pedestrian Bridge/East Aspen Street $ 170,000 This project will provide for pedestrian connectivity through a trail extension and a non-vehicular crossing of Bozeman Creek. The project also includes sidewalk along one side of East Aspen Street between the creek and North Rouse Avenue. This will result in the improvements along yet another street within the district and will tie into the new improvements to North Rouse Avenue. Pocket Park – North Church Avenue right-of-way design $ 25,000 Several years ago, a trail was constructed along the North Church Avenue right-of-way between East Cottonwood Street and East Tamarack Street. Under this project, that trail is to be extended north from East Tamarack Street, with a pocket park constructed along the stream. The first step in the process is to design the trail improvements and the pocket park enhancements. Quiet Zone Construction $ 225,000 The quiet zone study has identified the improvements required for quiet railroad crossings. It is anticipated that the improvements for the North Wallace Avenue/L Street crossing will include an arm for the pedestrian crossing as well as raised medians on both sides of the railroad tracks to preclude vehicles from driving around down arms. Improvements to Griffin Drive, including upgrades at the railroad crossing, are underway and should be completed in Fiscal Year 2022. Since improvements will be required for all three crossings before a quiet zone can be implemented, it is important to undertake crossing improvements as monies are available. Public Art $ 10,000 The Northeast Urban Renewal Board recognizes the artsy character of the area and, over the years, has identified the importance of acknowledging and promoting that character. The Board also has discussed various options to identify the entrances to the district, particularly at the bridges crossing Bozeman Creek on East Tamarack Street and East Peach Street. Since those bridges were installed as part of the Montana Department of Transportation’s improvement project on North Rouse Avenue and are utilitarian in nature, monies have been budgeted for 232 Northeast Urban Renewal Board Annual Work Plan and Budget FY2023 4 public art at those entrances. One possible option is chain link art in place of the chain link fences at the bridge abutments. Parking Structure $ 50,000 The Board recognizes the need for additional parking within the district and continues to monitor the progress of any potential proposal to construct a parking structure. These monies cover the costs of retaining consultants to do due diligence to determine that this proposal is in the District’s best interests. Trails/Boulevards/Alleyway Maintenance $ 12,000 The Northeast Urban Renewal District completed improvements to the depot trail, depot park, Aspen Street trail and North Church Avenue trail several years ago and continues to pay annual costs for maintenance of those amenities, including clean-up of litter along those trails and the newly constructed East Front Street trail extension. The budget also includes weekly watering of seven newly planted boulevard trees along East Tamarack Street to ensure their survival. This is the second year of a two-year commitment to provide that weekly watering. Also, weed abatement and enhancements in the alleyway public rights-of-way have been identified as important to the appearance and livability of the area. Administrative Services $ 32,800 Costs covered under this item include staff support ($3,000), administrative services ($19,800) and professional services ($10,000). Bond Costs $ 213,900 Costs covered under this item include bond repayment ($93,000) and the designated bond reserve ($120,900). Designated Reserve - Projects $ 292,300 At this time, it does not appear there will be adequate monies to fund construction of any additional large scale projects. If the opportunity arises, one of the projects listed below may be moved forward and funded through this designated reserve, particularly if such a move results in significant cost savings. Northeast Urban Renewal District (NURB) Future Projects Trails within the district $ 200,000 The Board has determined its top priority projects for the upcoming years revolve around trails within the district that enhance its livability and provide non-vehicular connectivity. It was noted these are projects not likely to be part of any development project but are desired improvements. At this time, there are no identified trail segments, but expenditure of these monies should be considered as opportunities arise. Also, a portion of these monies could be used to develop pocket parks, possibly in conjunction with the trail segments. 233 Northeast Urban Renewal Board Annual Work Plan and Budget FY2023 5 Connector trail – Depot trail to Audubon site $ 25,000 The Audubon Society has acquired 32 acres of wetlands and sensitive lands lying east of this district and is purchasing an additional 8 acres. The subject site lies outside the boundaries of the district; however, a portion of the trail extension lies within the district; and these monies are for that portion of the trail only. This trail extension would provide a safe access for pedestrians moving through the district to the enhanced wetlands area. Reimburse Wildlands public infrastructure $ 580,000 The Wildlands project includes expansion of the existing building at the northeast corner of the intersection of East Peach Street and North Wallace Avenue and demolition of improvements on the adjacent lot to provide adequate space for the expansion and relocation of the parking lot. The applicant has requested reimbursement for the public infrastructure improvements required in conjunction with the project. The City Commission concurred in the Board’s recommendation to approve that request once the applicant has completed the projects and paid at least two years of property taxes that equal the amount of the reimbursement. North Ida Avenue – Peach to Cottonwood $ 330,000 Due to the applicant’s decision to not proceed with the TinWorks Project, this project might not be pursued. However, if a development project is completed and the developer is required to construct a majority of the streets in the area, leaving this one-block segment unimproved, this Board believes it is important to connect it to the larger project, providing a more cohesive and cost-effective project. It is also needed to meet the district plan’s goal of improving connectivity and pedestrian safety within the District. Front Street – Ida to Aspen $ 118,000 The off-site street improvements required for the TinWorks Project include only one-half of the Front Street improvements from North Ida Avenue eastward to East Aspen Street. This project will provide completion of the full street improvements. It be most efficiently constructed in conjunction with the larger scale improvements that will come with the TinWorks Project improvements. Due to the applicant’s decision to not proceed with the TinWorks Project, this project might not be pursued. Front Street – Tamarack to Ida Construction $ 190,000 It would be financially beneficial to construct this improvement in conjunction with the improvements being made by the developer of the TinWorks Project. Also, it will result in more cohesive completion of infrastructure improvement within the district and will benefit the community as a whole. Included in the project will be extension of the fiber conduit installed with the East Tamarack Street improvements. Due to the applicant’s decision to not proceed with the TinWorks Project, this engineering project might not be pursued. 234 Memorandum REPORT TO:City Commission FROM:David Fine, Economic Development Program Manager Brit Fontenot, Economic Development Director SUBJECT:North Park Renewal District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Finance RECOMMENDATION:I move to approve the North Park Renewal District Fiscal Year 2023 Work Plan and Budget STRATEGIC PLAN:2.2 Infrastructure Investments: Strategically invest in infrastructure as a mechanism to encourage economic development. BACKGROUND:Due to the slow pace of development, the North Park Urban Renewal District has never had the tax increment to propose a Work Plan and Budget. Staff is requesting budget authority to spend up to $100,000 of existing cash-on-hand to move projects and development agreements forward in the District. These funds could also be devoted to the design or construction of public infrastructure that serves the District. UNRESOLVED ISSUES:None at this time. ALTERNATIVES:As suggested by the City Commission. FISCAL EFFECTS:Staff is requesting appropriations of $100,000 from the North Park Urban Renewal District tax increment fund. Attachments: NP URD Work Plan and Budget FY 23 FINAL.pdf Report compiled on: June 3, 2022 235 NORTH PARK URBAN RENEWAL DISTRICT FY2022 ANNUAL REPORT and FY2023 WORK PLAN AND BUDGET Goals of the North Park Urban Renewal District Plan GOAL 1: Promote Economic Development, with a Focus on Value-Adding Commerce Rationale: Value-adding commerce strengthens the community, opens reinvestment opportunities, supports livable wage jobs, and provides for economic needs of the citizens, helping to eliminate conditions that contribute to blight. GOAL 2: Invest in Efficient Delivery of Public Infrastructure Rationale: Infrastructure is the backbone of the community. Private development typically requires a corresponding public investment in infrastructure. Capital improvements in the district will help achieve economic vitality and address conditions that contribute to blight. GOAL 3: Support Planned Urban Density and Design Rationale: Higher density achieves greater efficiency in the delivery of public services. Live-work opportunities can reduce or eliminate commute times, lower transportation costs and create vitality and a sense of community. Design elements such as open space and pedestrian facilities promote recruitment of value-adding businesses interested in quality of life for their employees. North Park Urban Renewal District (NPURD) FY2022 Annual Report (July 1, 2021 to June 30, 2022) Highlights of investments over $15,000 are documented below. No funds were expended in the NPURD in FY 2022. 236 North Park Urban Renewal District (NPURD) FY2023 Work Plan (July 1, 2022 to June 30, 2023) Professional Services / Outside Counsel / Public Infrastructure $100,000 Staff is requesting budget authority to spend up to $100,000 of existing cash-on-hand to move projects and development agreements forward in the District. These funds could also be devoted to the design or construction of public infrastructure that serves the District. 237 Memorandum REPORT TO:City Commission FROM:David Fine, Economic Development Program Manager Brit Fontenot, Economic Development Director SUBJECT:Pole Yard Urban Renewal District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Finance RECOMMENDATION:I move to approve the Pole Yard Urban Renewal District Fiscal Year 2023 Work Plan and Budget. STRATEGIC PLAN:2.2 Infrastructure Investments: Strategically invest in infrastructure as a mechanism to encourage economic development. BACKGROUND:The Pole Yard Urban Renewal District was created in 2020 and has limited fiscal resources as a result its recent creation. This is the first proposed Work Plan and Budget for the District. Staff is requesting budget authority to spend up to $80,000 of existing cash- on-hand to move projects and development agreements forward in the District. These funds could also be devoted to the design or construction of public infrastructure that serves the District. Specifically, these funds could be allocated to the construction of quiet zone improvements at the Rouse Ave. crossing in the event the project moves forward within the Fiscal Year. UNRESOLVED ISSUES:None at this time. ALTERNATIVES:As suggested by the City Commission. FISCAL EFFECTS:Staff is requesting an appropriation of $80,000 from the Pole Yard Urban Renewal District tax increment fund. Attachments: Pole Yard URD FY 23 Work Plan and Budget FINAL.pdf Report compiled on: June 3, 2022 238 POLE YARD URBAN RENEWAL DISTRICT FY2022 ANNUAL REPORT and FY2023 WORK PLAN AND BUDGET The Purpose and Intent of the Pole Yard Urban Renewal District and Plan The creation of the URD in the Pole Yard enables the City of Bozeman to eliminate conditions that contribute to blight substantially impairing sound growth of the City through investments in public infrastructure and efficient delivery of public services. Goals of the Pole Yard Urban Renewal District Plan GOAL 1. Promote Innovative Economic Development Rationale: Commerce strengthens the community, opens reinvestment opportunities, enables livable wage jobs, and supports the sound growth of the community, helping to eliminate conditions that contribute to blight. GOAL 2. Enable Enhanced Connectivity and Mobility Rationale: Connecting neighborhoods through investments in multi-model transportation corridors strengthens the fiber of the community. GOAL 3. Invest in Efficient Delivery of Public Infrastructure Rationale: Infrastructure is the backbone of the community. Private development typically requires a corresponding public investment in infrastructure. Capital improvements will help achieve economic vitality and support the delivery of public services. GOAL 4. Foster Urban Neighborhood Coherency Rationale: Higher concentration of development achieves greater efficiency in the delivery of public services. Urban growth, oriented to centers of employment and activity, can reduce or eliminate commute times, lower transportation costs and create vitality and a sense of community. Integrated elements of growth, ensuring a cohesive neighborhood that in turn contributes to the well-being of the entire community, will reduce geographic, as well as economic and social isolation. GOAL 5. Protect Public Health Rationale: An area that includes a superfund site presents the need for increased diligence to comply with the obligation to not exacerbate the human health contact risk or environmental contamination. GOAL 6. Encourage the Retention of Existing Businesses 239 Rationale: Urban infill development can affect the community through such things as additional traffic and noise, particularly when the existing public systems do not meet current standards. GOAL 7. Respect Critical Environments Rationale: Riparian and wetland areas provide benefits to the community through such things as filtering urban runoff, providing habitat for wildlife and flood protection. Pole Yard Urban Renewal District (PYURD) FY2022 Annual Report (July 1, 2021 to June 30, 2022) Highlights of investments over $15,000 are documented below. No funds were expended in the PYURD in FY 2022. Pole Yard Urban Renewal District (PYURD) FY2023 Work Plan (July 1, 2022 to June 30, 2023) The Pole Yard Urban Renewal District was created in 2020 and has limited fiscal resources as a result its recent creation. Professional Services / Outside Counsel / Public Infrastructure $80,000 Staff is requesting budget authority to spend up to $80,000 of existing cash-on-hand to move projects and development agreements forward in the District. These funds could also be devoted to the design or construction of public infrastructure that serves the District. Specifically, these funds could be allocated to the construction of quiet zone improvements at the Rouse Ave. crossing in the event the project moves forward within the Fiscal Year. 240 Memorandum REPORT TO:City Commission FROM:David Fine, Economic Development Program Manager Brit Fontenot, Economic Development Director SUBJECT:South Bozeman Technology District Fiscal Year 2023 Work Plan and Budget and Fiscal Year 2022 Annual Report MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Finance RECOMMENDATION:I move to approve the South Bozeman Technology District Fiscal Year 2023 Work Plan and Budget. STRATEGIC PLAN:2.2 Infrastructure Investments: Strategically invest in infrastructure as a mechanism to encourage economic development. BACKGROUND:Due to the slow pace of development on the MSU Innovation Campus, there has never been enough tax increment value to spend money prior to this fiscal year. Staff is requesting budget authority to spend up to $10,000 of existing cash- on-hand to move projects and development agreements forward in the District. These funds could also be devoted to the design or construction of public infrastructure that serves the District. UNRESOLVED ISSUES:None at this time. ALTERNATIVES:As directed by the City Commission. FISCAL EFFECTS:Staff is requesting appropriations of $10,000 from the South Bozeman Technology District Tax Increment Fund. Attachments: SBTD Work Plan and Budget FY 2023 FINAL.pdf Report compiled on: June 3, 2022 241 SOUTH BOZEMAN TECHNOLOGY DISTRICT FY2022 ANNUAL REPORT and FY2023 WORK PLAN AND BUDGET New Mission and Vision for the Montana State University Innovation Campus The Mission of the Montana State University Innovation Campus is: • To promote economic development and support partnerships between regional, national, and international high tech-based businesses and the research community of Montana State, the region, and the State of Montana. • To create a world-class research park to promote academic and industry collaboration to advance research and scientific discoveries with Montana State University Faculty and Students that will maximize the academic talent and regional resources of Montana State University, the region, and the State of Montana. • To promote learning and collaboration in support of scientific research, new discoveries, and inventions to further the commercialization of Montana State University’s intellectual assets and technology transfer. • To provide state-of-the-art facilities, programs, services, and amenities to support the growth and success of technology-based businesses. • To provide ‘the place'' to link academic, private, and governmental researchers and scientists to advance new discoveries in support of the Citizens within the State of Montana, the nation, and the world. The Vision of the Montana State University Innovation Campus is: To be recognized as the 'the place' that provides a unique community to connect people and support public private partnerships to stimulate new ideas, push forward the advancement of research and science, and produce new discoveries and technologies that will transform the world. 242 South Bozeman Technology District (SBTD) FY2022 Annual Report (July 1, 2021 to June 30, 2022) Highlights of investments over $15,000 are documented below. No funds were expended in the SBTD in FY 2022. South Bozeman Technology District (SBTD) FY2023 Work Plan (July 1, 2022 to June 30, 2023) Professional Services / Outside Counsel / Public Infrastructure $10,000 Staff is requesting budget authority to spend up to $10,000 of existing cash-on-hand to move projects and development agreements forward in the District. These funds could also be devoted to the design or construction of public infrastructure that serves the District. 243 Memorandum REPORT TO:City Commission FROM:Kaitlin Johnson, Budget Analyst Rachel Harlow-Schalk, Interim Finance Director Jeff Mihelich, City Manager SUBJECT:FY2022-2023 City Manager Recommended Budget Highlights: Internal Service and Special Revenue Funds MEETING DATE:June 14, 2022 AGENDA ITEM TYPE:Finance RECOMMENDATION:Listen to staff presentations, ask questions, provide comments, and give direction. STRATEGIC PLAN:7.5. Funding and Delivery of City Services: Use equitable and sustainable sources of funding for appropriate City services, and deliver them in a lean and efficient manner. BACKGROUND: This presentation will provide highlights from the Internal and Special Revenue Funds as recommended in the FY2022-FY2023 (FY23) City Manager Recommended Budget. The presentation will highlight Internal Services and Special Revenue funds in the “Fund Summaries” section of the document. Operationally, there are three groups that provide services to every City department. These groups are “internal services” that charge each department for services. Internal Services includes are Public Works Administration (Engineering, Geographical Information Systems), Vehicle Maintenance, and the City’s Health-Medical Self-Insurance Fund. Special Revenue funds are expenditure specific funds created by the City Commission or established as the result of other state or local laws passed. Outside of property tax, Bozeman is limited in its ability to generate other revenues to support community. Special Revenue funds are used to help relieve the General Fund by generating revenue for limited expenses as outlined in Montana Code Annotated. 244 In addition to this presentation, the Commission was provided an introduction to the budget on May 24, 2022, and Highlights on the General and Enterprise funds on June 7, 2022. On June 28, 2022, the Final Budget Hearing for the Appropriation Resolution will take place. Once the Appropriation Resolution is passed, the budget becomes the City Commission’s adopted budget for the City of Bozeman beginning July 1, 2022. The entire “FY2022-2023 City Manager Recommended Budget” document is available online at: https://www.bozeman.net/departments/finance/budget-and-financial- reports. Copies are also be available to the public at the Bozeman Library and City Clerk’s office. UNRESOLVED ISSUES:The Commission is requested to provide any questions in advance of this meeting or for follow-up during a later budget work session specific to unresolved issues identified. ALTERNATIVES:If there are changes the City Commission would like to make to the schedule of Budget Work Sessions, please let us know during this presentation. FISCAL EFFECTS:This presentation has no immediate fiscal impacts, but it is the second working session as part of the budget adoption process for the FY23 fiscal year which begins on July 1, 2022. Once adopted, the budget will fund activities that support the Commission's priorities. Report compiled on: June 6, 2022 245