HomeMy WebLinkAbout13- Subrecipient Agreement between City of Bozmen, Gallatin Development Corp,, SUB-RECIPIENT AGREEMENT FOR
COMMUNITYDEVELOPMENTBLOCK GRANTEVOLVING LOANFUND
July= 2013 --_July 2015
J61
TIES AGREEMENT is entered into this ,� day of July, 2013 by the CITY OF BOZEM_AN,
MONTANA,whose address is 121 N Rouse, Bozeman MT 59715, herein'referred to as the "City", and the
GALIATIN DEVELOPMENT CORPORATION, doing business as PROSPERA BUSINESS
NETWORK, whose address is 222 East Maim Street, Suite 102, Bozeman MT 59715, a nonprofit economic
development corporation,herein referred to as the "Sub-Recipient."
WITNESSETH THAT:
WHEREAS, the City has applied to and has been approved by the Montana Department of Commerce
(MTDOC) for the receipt of grant funds under the Montana' Community Development Block Grant
Economic Development (CDBG) Program; and
WHEREAS, the City wishes to use present and future CDBG grants and loan fund revenue to further
develop the "CDBG Revolving Loan Fund" (RLF� which is designed to leverage private investment in new
business for the purpose of generating new jobs within the City of Bozeman;and
WHEREAS, the City, has previously entered into on Agreement with the Sub-Recipient to sub-grant the
CDBG funds to the Sub-Recipient and engage the Sub-Recipient to administer the City, of Bozeman (RLJ-�
jointly on their behalf for a period of twenty four months; and
WHEREAS, to maintain accountability, professional management and program performance, it is deemed
to be in the best interests of the City to extend the Agreement with the Sub-Recipient for nvo additional
years, as hereinafter provided; and
WHEREAS, the City desires to continue to sub grant the CDBG funds to the Sub-Recipient and engage
the Sub-Recipient to administer the RLF on the Cin,'s behalf, and
WHEREAS, there exists City of Bozeman Economic Development Revolving Loan Fund Guidelines,
established pursuant to Commission Resolution 3488 which are hereby,included in this agreement; and
WHEREAS, pursuant to Resolution 3488 there exists a City, of Bozeman Revolving Loan Fund Committee
(the "RLF Committee"); to evaluate the feasibility, and investment potential of proposed economic
development projects; and
WHEREAS, the parties to this Agreement understand that neither of them has in any, way, expressly, or
impliedly, abrogated any of its individual powers, and further agree that this Agreement does not create any
new organization or legal entity.
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NOW, THEREFORE, in consideration I OF the mutual covenants and conditions set out in tl is
folio ernent, the parties agree that the fo a ws: �D foregoing statements of fact are true and correct and further agree as
A, SPECIAL PROVISIONS. The City agrees, under the terms and conditions of this Agreement, to sub-
grant to the Sub-Recipient the CDBG loan funds as a grant for gap financing and technical assistance to
eligible borrowers and does hereby transfer, assign and convey to Sub-Recipient all of the City's interest in
and to its existing RLF loan portfolio.
B. INDJ"TJ"_7,NDE NT CONTRACTOR.
It is understood by the pal-ties hereto that the Sub-Recipient is an independent contractor and that neither
its principals nor its employees, if any, are employees of the City for purposes of tax, retirement systern, or
social security (FICA) withholding, It is further understood that pursuant to section 39-71-401, MCA, the
Sub-Recipient has obtained, and will maintain at its expense for the duration of this Contract, coverage in a
workers' compensation plan for its principals and employees for the services to be performed hereunder.
C. SCOPE I SERVICES. The Sub-Recipient-will perform the Following sel-NI ces:
1 The Sub-Recipient \vil.1 be responsible for 211 facets of the CDBG financing program as described in the
Managernent Plan for the CDBG project, a cop), of which the City has delivered or will deliver to Sub-
Recipient prior to execution of this Agreement. The Sub-Recipient will also be responsible for all
aspects of the Revolving Loan Fund program, including the f6floNving:
(a) Develop, apply and enforce written Policies and Procedures as they relate to the City of
Bozeman RLF program and/or administering the RLF program under the local C6BG, grant
program,including the creation and operation of an RLF Loan Committee to review and act
upon loan requests.
(b) Application process through approval.-
Assist prospective borrowers in completing loan application materials;
b. Conduct UCC ben searches,if applicable and pertinent to the proposed loan collateral
c. Provide a project analyses to the RLF Loan Committee;
cl. Coordinate monthly RLF Loan Committee meetings; and
e. Present proposed projects to RLF Loan Committee for loan approval or denial.
Decision, as to loan approval or denial are the sole responsibility of the RLF Loan
Committee, and the Cit), shall have no authority or ability to intervene in the loan
approval or denial process,
(c) Loan Closing and Documentation:
a
a. Completion of loan documentation using loan documentation software;
b, Loan closing, to be conducted by a title company or by Sub-Recipient;
c, Funds disbursement and payment processing, utilizing the GYMS Loan Accounting
soffivare; and
d. Collection and retention, for Sub-Recipient's use, of loan fees and charges, as provided
in Sub-Recipient's Policies and Procedures.
(d) Loan Servicing Oversight:
a, Gather and analyze month]), or quarterly financial reports from borrowers as required by
the applicable loan agreement;
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h, Track and monitor status of borrower insurance policies;
c. Track and monitor UCC financing statement filings and renewals; and
d. Provide monthly loan updates to RLF Loan Committee.
(e) Process monthly loan payments
a. Track, receive, process and account for all monthly loan payments
b. Track late payments—mailing late notices and calling delinquent borrowers, as needed
c, Work with delinquent borrowers to cure defaults and, where appropriate, develop a
work-out plan, subject to approval of the RIX Loan Committee,
Monitor and process all forfeitures of loan collateral And use commercially reasonable efforts to
collect delinquent and defaulted loans,including the filing of creditor's claims in bankruptcy,,
where applicable, subject to the approval of the RLF Loan Committee,
2. The Sub-Recipient shall maintain eligibility as a Community-biased Development Organization cm pursuant
to-Title 24, Part 504, CFR, and shall ensure all activities conducted pursuant to this Agreement comply
Nvqth all federal and state regulations regarding community development block grants.
3. During the term of this Agreement, the Sub-Recipient will maintain reasonable records of its
performance under this Agreement in a manner consistent with generally accepted accounting
principles. The Sub-Recipient ,vill provide the City (or its authorized representatives) access to these
records at any time during normal business hours. Upon written request of the City, the Sub-Recipient
will submit to the Ci�,, in the format prescribed by the City, semi-annual status reports on its
performance under this Agreement.
4. Except as set forth in Section (4) below, the Sub--Recipient will retain, administer, manage, record, and
account to the City for all RLF loan fund revenue received subsequent to the date of this Agreement,
including principal and interest received from borrowers. Sub-Recipient will use such revenue to
enhance the RLF program for the benefit of all eligible borrowers located within the City of Bozeman.
5. As payment for the services tendered by Sub-Recipient, the Sub-Recipient shall retain either S32,000.00
or eighteen percent (18`"/o) of the total of payments On interest and principal from loan repayments and
interest earned on the principal balance, whichever is greater, The Sub-Recipient may retain and pqN
such compensation to itself in installments, not more frequently than monthly. In no case, except for
the Sub-Recipient's expenses for attorney fees and attorney costs related to collection efforts as
described in subsection 6 of this section, shall the payment fol' services to the Sub-Recipient result in a
decrease in the base princil-.),ii amount of the fund as determined on a yearly basis.
6. Sub-Recipient is entitled to use RLF funds for any costs incurred by Sub-Recipient in connection with
the collection of delinquent or defaulted loans, including but not limited to any filing fees or legal fees
and costs, It is specifically agreed and understood that any such use of RLF funds in this manner by the
Sub-Recipient is separate and distinct from the payment Sub-Recipient will be receiving for its services;
that is to say, costs and fees incurred in connection with the collection of delinquent or defaulted loans
will be paid by RLF Funds and not by the Sub-Recipient,
D. EFFECTIVE DATE AND TIME OF PERFORMANCE This Agreement supersedes all prei,ious
agreements, whether written or oral, between the City and the Sub-Recipient dealing with the Cjq� of
Bozeman RLF program, The term of this Agreement shall be twenty four (24) months, commencing on the
date of execution by the parties, This Agreement will terminate upon expiration of its 'rfti2l term, unless
extended in writing by mutual agreement of the parties, or if either party fails to meet the conditions of this
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Agreement or if an Event of Default occurs, after notice and opporturriti, to cure as N
provided in Section
below. ect
E. CONFLICT OF' INTEREST, The Sub-Recipient covenants that it presentivl has no interest and
will riot acquire an), interest, direct or indirect, In the CDBG project that would conflict in any manner or
degree with the performance of its services hereunder, The Sub-Recipient further covenants that, in
performing this Agreement,it will employ no person who has any such interest.
F. CIVIL,RIGHTS ACT OF 1964, The Sub-Recipient will abide by the provisions of the Civil Rights
Act of 1964, which states that under Title V1, no person may, on the grounds of race, color, or national
origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under
any program or activity receiving federal financial assistance.
G.
S17CTION. 109 OFTHE 14OUSING AND (]OMMUNII)LDENTELOPM NT ACT OF 1974,
The Sub-Recipient vill comply with the following provision:
No person in the United States may on the grounds of race, color, national origin, or sex be excluded
from participation in, be denied the benefits of, or be subjected to discrimination under any program or
activity funded in whole or in part with the funds made available under this title. An)', prohibition
against discrimination on the basis of age under the Age Discrimination Act of 1975 or with respect to
an otherwise qualified handicapped individual as provided in Section 504 of the Rehabilitation Act of
1973 will also apply to an), such program or activity.
H. NONDISCRIMINATION. In addition to the requirements of subseciton G, above, the Sub-
Recipient will not discriminate against any employee or applicant for employment on the basis of race,
color,i religion, creed, political ideas, sex, age, marital status, or national origin, or because of actual or
perceived �Z sexual orientation or gender identity or disability., The Sub-Recipient agrees this provision
will apply to the hiring and treatirrent of the Sub-R'ecipient's employees and shall be included in all loan
agreements with borrowers and apply to the use and expenditure of RLF funds.
L RF,,PORTS AND INFORAJATION. The Sub-Recipient will maintain accounts and records,
including personnel, property and financial records, adequate to ldentify and account for all costs pertaining
to this Agreement and such other records as may be deemed necessary by the City to assure proper
accounting for all project funds. These record,- will be made available for audit purposes to the ' or its
authorized representative, and will be retained for three years after receipt of firra] payment for theservices
rendered under this Agreement unless permission to destroy them is granted by the City
.J. ADMINISTR-ATION,
I For purposes of implenienting this Agreement, the City will appoint a local government project
representative that will Nvork with the Sub-Recipient. The parties will meet as necessar), to provide
for the efficient and smooth implementation of this Agreement and the activities contained herein,
2. The parties agree the RLF Committee shall have final decision making authority regarding the
loaning of RLF funds and shall follow guidelines set, .forth in Commission Resolution No. 3488
except that this Agreement supersedes the requirements of Commission Resolution 3488 only in so
far as it relates to any provision in Resolution 3488 in conflict with this Agreement.
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To ensure tile compositior, of tile RLF Committee complies with applicable fecicn,11 regulations, tile
Committee shall consist of seven members, two of which shall be appointed by the
Commission,with the remaining five to be appointed by the Sub-Recipient.
4. The Sub-Recipient will comply with tile "Certifications for .Application" signed by the Cm, and
submitted with the application for economic development assistance to the Mont2nabepartinent of
Commerce.
5. The Sub-Recipient shall ensure that all borrowers, to whom Sub-Recipient lends RLF funds after the
effective date of this Agreement:, comply with the State of Montana Department of Commerce's
Community Development Block Chant Economic Development Program Application Guidelines
pertaining to low and moderate income persons,
6. The Sub-Recipient will comply with Procurement Standards as outlined in Chapter 3 and Chapter 8
of the CDBG, Administration INIanual before entering into j agreements to remodel, to purchase
equipment or material, or to retain the services of a consultant or Sub-Recipient,
7. The Sub-Recipient ,vill contract with an independent accounting firm to conduct an annual audit
sufficient to obtain an unqualified opinion of the RI-Floan fund and program as conducted by Sub-
Recipient under this Agreement.
K. TERAIJNATION - DISPOSITION OF REAL PROPERTY OR E )UMNIENT AC UIRED.
Upon the expiration or termination of this Agreement, the Sub-Recipient will transfer to the City the then-
existing RLF loan portfolio and 211 related loan records, togethervv1th the then-existing balance in the Sub-
Recipient's RLF loan fund, less any unpaid portion of Sub-Recipient's compensation under this Agreernent
to the date of expiration or termiriatlion.
L. INDEMNIFICATION. The parties agree to waive an\, and all claims and recourse against one
another, including the right of contribution of loss or damage to 'person or property arising from, growvjjjg
out of, or in any way connected Nk7'th or incidental to the parties' performance of this Agreement, Each
part, shall indemnify,, defend and 7 hold harmless the other party (including such other party's 'affiliates,
partners, officers, directors, employees, agents and representatives} against any claims and/or liabilities of
any nature, including reasonable attomevs' fees, arising out of the performance of this Agreement. The City
specifically agrees that RLF loan decisions are the prerogative of the RLF Loan Committee, and that the'
Sub-Recipient has no h2bihty of any 1,irid for decisions and actions related thereto, including loan decisions
that were made prior to this Agreement.
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M. TERMINATJON OF_AGREj_:`,ME_Nj. If an), of the following events occur, the Cjt�, may, In its
sole discretion, declare such event a default under this Agreement ("Event of Default").
1 Any representation or warranty made by the Sub-Recipient in this Agreement, or in an), request or
certificate or other information furnished to the City under this Agreement, proves to have been
incorrect in an),material respect; or
2. The Sub-Recipient fails in any material respect to carry out its obligations under its proposal to the
City for the assistance provided under this Agreement.
If the Sub-Recipient falls to perform any of its duties under this Agreement or if any Event of Default
occurs, the City may declare the Sub-Recipient to be in default and thereafter i o give the Sub-Recipient written
notice setting forth the action or inaction that constitutes the default and giving the Sub-Recipient 45 days in
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which to correct the default. If the Sub-Rccipient fails to correct the default within 45 days of receipt of
such notice, the City may tcrininate this Agreement without further notice, subject to the terms of Section L
above,
The parties agree that this Agreement provides for reasonable and sufficient notice to be given en to the Sub-
Recipient in case of the Sub-i-ecipient's failure to corriply with any of its covenants and that this notice is
sufficient for the Sub-Recipient to rectify it', actions or inactions of default.
The waiver by- the City of ariv default by the Sub-Recipient does not constitute a waiver of a continuing
breach or a waiver of a subsequent breacii. Any agreement contrary to this Agreement is not binding upon
either part), unless it is in writing and signed by both parties.
N. CONSTRUCTION AND VENUE
This Agreement will be construed under and governed by the laws of the State of Montana. The City and
the Sub-Recipient agree that performance of this Agreement is in the County of Gallatin,State of Montana,
and that In the event of litigation concerning it,venue is in the District Court of the judicial District in and
for the City of Bozeman,Montana.
This Agreement has been approved by City Commission and by Sub-recipient's Board of Directors, e,,ich ofmrbich has Authorized
the undersigned persons to ewcute this Agreement on its behalf.
O. ATTORNEY'S FEFS. In the event that either part),incurs legal expenses,including the costs,
expenses, salary and fees of the in-house counsel, to include City Attorney, to enforce the terms and
conditions of this Agreement, the prevailing party is entitled to recover reasonable attorney's fees and other
costs and expenses, whether the same are incurred with or without suit, including fees on appeal,
P. PUBLIC MEETINGS AND ACCES.S TO PUBLIC RECORDS. The Sub-Recipient's RLF Loan
Committee shall comply ,vith the open meeting requirements of Montana law, including those set forth in
Title 7, Chapter 1, Part 41, RICA and Title 2, Chapter 3, MCA, To help ensure compliance, the Sub-
Recipient shall provide RI-FCommittec meeting agendas to the City Clerk's office no later than 72 working
hours prior to meeting for notice on the City's official posting board and ally other sites deemed reasonable
by, the Clerk's office. In addition, meeting 'minutes -,wild be kept by the Sub-Recipient and provided to the
Cite Clerk's office no later than 45 days after the meeting. These minutes shall be posted and made available
to the public by the City ClerVs office except for those minutes taken during a closed meeting in accordance
with 7-1-4144, MCA. Minutes taken during a closed meeting shall also be provided to the Cin, Clerk's office
but shall be handled in accordance with the City, Clerk's regular executive session protocol a'
in a secured cabinet. and kept private
In accordance with 7-1-4144, MCA and subject to any applicable legal obligation to protect and preserve
individual conFidential or private information, upon reasonable request and at reasonable times during
normal business hours, Sub-Recipient shall make such RLF loan documents and records available for
inspection nspecti.on and copying by members of the public. Sub-Recipient may charge for such copying in accordance
with the policies of the cip,,which Sub-Recipient hereby adopts for such purposes.
To determine whether a meeting or part of a meeting may be closed to the public and to determine whether
information contained in RLF loan documents is protected by law from disclosure, the Sub-Recipient may
consult with and seek the advice of the City- Attorney at no cost to Sub-Recipient. The advice and
consultation shall be on behalf of the RLI, Committee and not Gallatin Development Corporation,
Q j_jjGjBjLITY. The Sub-Recipient certifies that the Sub-Recipient and the Sub-recipient's
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Principals are not debarred, suspended, Voluntarily excluded, or otherxkise ineligible for participation in
federally assistcd contracts under Executive Order 12549, "Debarment and Suspension". (24 CF'R 24,505)
INNII NESS W HEREOF, the parties hereto have executed this Sub-Recipient Agreernent on the
g dais of July, 2013.
SUB-RECIPIEN,r: C1,1y:
Kathleen n Date Chris Kukulskj
- -Jo1-111'
President,n Date
resident, Boar of irectors City Manager
�, lot)
Gallatin Develop. unt Corporation, City, of Bozen-ian
DBA "Prospera Business Network"
Attest:
Attest: 0 P
17-13
Toni Kelly Date St
Date
Secretary,Boar of Directors C t Cle' -
Gallatin Development Corporation,
C ty,o ozel
DBA "Prospera Business Network 0.
Approved as to Form:
I7 ullivan Date
Oz-man City Attorney
P,,cge 7 of 7
p
June 12,2013
Jane 12,2013
0
Mayor Prospera Business Network
Sean Becker Stuart R. Leidner
2015 Charlotte Street, Suite 1
Deputy Mayor Bozeman,MT 59718
Jeff='Krauss
Commissioners Dear Stuart:
Cyndy Andrus
Chris Mehl This letter serves as a temporary extension of the Sub Recipient Agreement for the
Carson Taylor administration of the Bozeman CDBG Revolving Loan Fund, dated June 11,2011
BOZEMAN
CITY OF between the City of Bozeman and Prospera Business Network.
Thi letter of extension is intended to serve in the interim until the new Sub-Recipient
121 N. Rouse Agreement can be approved by the City Commission at a date to be determined in the
P.O. Box 1230 � near future.
Bozeman, MT 59771
It is our intent to renew the agreement with Prospera Business Network for an
Phone: (406) 5822320 additional period of twenty-four(24)months. We will begin the process of obtaining
Fax: (406) 582-2344 City Commission approval this month.
TDD: (406)582-2301
c
Nvwtiv.bozentan.net Best Regards,
Core wlues IN
111tegrity ,
Be honest,hard-
working,reliable and
accountable to the
Chris Kukulski
public.
r
City Manager
i City of Bozeman,MT
Leadersl�i� ,,
Take initiative,lead by
example,and be open to The Most Livable Place"
innovative ideas.
service
Work unselfishly for
our community and its
citizens.
Teamwork
Respect others,
welcome citizen
involvement,and work f
together to achieve the
best result,
Ski