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Res 2017-09 Reimbursement of Water & Sanitary Utiliy Chrgs RESOLUTION NO. 2017 - 09 RESOLUTION APPROVING AGREEMENT RELATING TO THE REIMBURSEMENT OF WATER AND SANITARY UTILITY SERVICE OVERCHARGES OCCURRING FROM 2008 THROUGH MID-2015 IN THE AMOUNT OF $556,067.68 RELATING TO ANOKA COUNTY TAX PARCEL ID NO. 03-30-24-13-0015 WHEREAS, the Metropolitan Council (the “Landowner”) owns the real and improved property located at 8296 Hickory St NE in Fridley (the “Property”); and WHEREAS, theLandowner made payments for water and sanitary utility services; and WHEREAS, theCity discovered the billing error during conversion of utility billing software; and WHEREAS, the City and the Landowner have engaged in discussions regarding the water and sanitary utility services fees and their calculation, as well the Landowner’s liability for the same; and WHEREAS, the City and the Landowner have negotiated a repayment of the overcharges through issuance of quarterly credits to avoid a financial strain upon the City’s utility funds and uncertainty of litigation over the same; and WHEREAS, the City will execute and record the Agreement Relating to the Reimbursement of Water and Sanitary Utility Service Overcharges Occurring from 2008 through Mid-2015 in the Amount of $556,067.68 Relating to Anoka County Tax Parcel ID No. 03-30-24-13-0015 (the “Agreement”) against the Property and, upon repayment of the overcharges as set forth in the Agreement, the City agrees to record a Satisfaction of Reimbursement against the Property. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Fridley: 1. The City Council hereby approves and authorizes the Mayor and City Manager to execute the Agreement Relating to the Reimbursement of Water and Sanitary Utility Service Overcharges Occurring from 2008 through Mid-2015 in the Amount of $556,067.68 Relating to Anoka County Tax Parcel ID No. 03-30-24-13-0015; and 2. The City Council hereby directs the Finance Director to record the Agreement Relating to the Reimbursement of Water and Sanitary Utility Service Overcharges Occurring from 2008 through Mid-2015 in the Amount of $556,067.68 Relating to Anoka County Tax Parcel ID No. 03-30-24-13-0015 against the Property. TH PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 13 DAY OF MARCH, 2017. ____________________________________ SCOTT J. LUND - MAYOR ATTEST: _________________________________ DEBRA A. SKOGEN – CITY CLERK CITY OF FRIDLEY ANOKACOUNTY, MINNESOTA AGREEMENT RELATING TO THE REIMBURSEMENT OF WATER AND SANITARY UTILITYSERVICE OVERCHARGESOCCURRING FROM 2008 THROUGH MID-2015 INTHE AMOUNT OF$556,067.68RELATING TO ANOKACOUNTY TAX PARCEL IDNO. 03-30-24-13-0015 THIS AGREEMENT RELATING TO UTILITY CHARGES (hereinafter referred to as the “Agreement”) is made, entered into and effective this _____day of _________,2017, by and between the City of Fridley, a Minnesota municipal corporation (hereafter referred to as the “City”) and the Metropolitan Council, a public corporation and political subdivision of the State of Minnesota(hereafter referred to asthe“Landowner”). Subject to the terms and conditions hereafter stated and based on the representations, warranties, covenants, agreements and recitals of the parties herein contained, the parties do hereby agree as follows: WHEREAS, Landowner owns fee title in real property in the City of Fridley,Anoka County, Minnesota, legally described on the attached Exhibit A and having the tax parcel identification number shown on Exhibit A (hereafter referred to as the “Property”),with an address of 8296 Hickory St NE, Fridley, MN, 55432; WHEREAS, Landowner warrants and represents that, as of the date of this Agreement, the undersigned Landowner is the fee title owner of the Property and has sufficient right, title and interest in the Property to make this Agreement and cause the same tobe binding upon the Property; WHEREAS ,theProperty is subject to the City’s water, sewer and storm water utility charges; WHEREAS, during the City’sutility billing software conversion, City staff became aware of an overbillingissue, asthe water meter that was initially installed during the construction of the Landowner’sbuilding in 2008 was set up to bill based on an incorrect number of digits causing the quarterly billings for water and sewerto be higher by the power of ten; WHEREAS, these higher water consumption calculationsalso directly affectedand resulted in overcharging the Landowner’s for sanitary sewer service; WHEREAS, the City has a legal obligation to correct overcharges to its customers; WHEREAS, theimmediate repayment of the Landowner’s overcharges, calculated to be a combined$556,067.68from 2008through mid-2015for water and sanitary sewer service (the “Overcharges”), would put excess burden on the financial position of the City’swater and sanitary sewer funds; WHEREAS, upon discussion withtheLandownerrepresentatives, the Landowner agreed theOverchargescould be applied as quarterly creditsover time onthe Landowner’s accountsandagreedthatit would waive any claim ofinterest on the Overcharges balance; WHEREAS, the City appreciates the Landowner’s willingness to minimize the financial strain the immediate repayment of the Overchargeswould causethe City; WHEREAS, the Landowner’s quarterly credit on its accountswill likely take many years to eliminate; WHEREAS, if at any point the Landowner sells the Property including the metered premises on the property the City will be required to reimburse the remainingcredit balancefor the Overchargesat the time of closing; and WHEREAS, in exchange for the mutual promises set forth above,Landownerand City agree to execute this Agreement. NOW, THEREFORE, the parties agree as follows: 1.The City and Landowner mutually agree that the amount of the Overcharges is $556,067.68; 2.The City agrees to repay and the Landowner agrees to accept the Overcharges through quarterly credits on the Landowner’s water and sanitary sewer accounts; 3.The Landowner agrees to waive interest on the unpaid balance of the Overcharges; 4.The City agrees to pay the remaining balance of the Overcharges at closing in the event the Landowner sells the Property;and 5.The parties mutually recognize and agree that the all terms and conditions of this recordable Agreement shall run with the Property and shall be bindinguponthe parties and successors until such time as the City haspaid the Overcharges. At such time of full repayment of the Overcharges, whether at closing or otherwise, the parties shall execute and record a Satisfaction of Reimbursement against the Property. IN WITNESS WHEREOF, the Landowner and the City have executed this Agreement effective on the latter date of approval by the two parties, and identified above. CITY OF FRIDLEY By: Scott Lund, Mayor By: Walter Wysopal, City Manager STATE OF MINNESOTA) )ss. COUNTY OF ANOKA) On this ______ day of _________________, 2017,before me a Notary Public within and for said County, personally appeared Scott Lund and Walter Wysopal, to me personally known, who being each by me duly sworn, each did say that they are respectively the Mayor and City Manager of the City of Fridley, themunicipality named in the foregoing instrument, and that the seal affixed to said instrument was signed and sealed on behalf of said municipality by authority of its City Council and said Mayor and City Manager acknowledged said instrument to be the free act and deed of said municipality. ________________________________________ Notary Public LANDOWNER By: Wes Kooistra, Regional Administrator STATE OF MINNESOTA) )ss. COUNTY OF __________) On this _____ day of _______________, 2017, before me, the undersigned, a Notary Public in and for the jurisdiction aforesaid, personally appeared Wes Kooistra, known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that the same was his/her act and deed for the purposes therein expressed for and on behalf of Metropolitan Council. Notary Public EXHIBIT A LEGAL DESCRIPTION OF THE PROPERTY The following real property located in the City of Fridley, County of Anoka, State of Minnesota: THAT PART OF THE SW¼ OF THE NE ¼OF SEC 3-30-24LYING EASTERLYOF THE EASTERLYRIGHT-OF-WAYLINE OF THE BNSF RAILROAD,SOUTHERLYOF THE NORTH135FEETOF SAIDSW¼ OF THE NE ¼&NORTHERLYOF THE SOUTH844FEETOF SAIDSW¼ OF THE NE ¼EXCEPTROAD RIGHT-OF-WAY;SUBJECTTO EASEMENTS OF RECORD AnokaCounty TaxParcel Identification No. 03-30-24-13-0015