Loading...
HomeMy WebLinkAbout05-268 Resolution No. 05-268 RESOLUTION AUTHORIZING EXECUTION OF A DEVELOPMENT AGREEMENT WITH E-FOODS USA FOR THE DEVELOPMENT OF 107 EAST HIGHLAND AVENUE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN,ILLINOIS,that Ed Schock,Mayor, and Dolonna Mecum, City Clerk,be and are hereby authorized and directed to execute a Development Agreement on behalf of the City of Elgin with E-Foods, USA for the development of corporate offices at the property located at 107 East Highland Avenue, Elgin, Illinois, a copy of which is attached hereto and made a part hereof by reference. s/Ed Schock Ed Schock, Mayor Presented: September 14, 2005 Adopted: September 14, 2005 Omnibus Vote: Yeas: 6 Nays: 0 Attest: s/Dolonna Mecum Dolonna Mecum, City Clerk DRAFT 3/31/05 DEVELOPMENT AGREEMENT This Development Agreement is made and entered into this 7'54 day of l , 2005, by and between the CITY OF ELGIN, an Illinois municipal corporation (hereinafter referred to as the "City" ) and E-FOODS USA, an Illinois Corporation (hereinafter referred to as "Developer" ) . WITNESSETH WHEREAS, Developer' s corporate offices have been located at the property commonly known as 245 Fulton Street, Elgin, Illinois; and WHEREAS, the City has acquired such property at 245 Fulton Street with the intention of demolishing such structure in order to construct a new City of Elgin parking structure; and WHEREAS, as a result of the acquisition of such property by the City the Developer must relocate its corporate offices; and WHEREAS, Developer, after consultations and negotiation with the City concerning certain development assistance, has determined to relocate its corporate offices in the City at 107 E . Highland Avenue, Elgin, Illinois (such property is hereinafter referred to as the "Subject Property" ) and the relocation of Developer' s corporate offices to the Subject Property is hereinafter referred to as the "Subject Relocation" ) ; and WHEREAS, the City providing business retention development assistance to Developer for the Subject Relocation will result in maintaining the City' s tax base and retain employment opportunities in the City of Elgin; and WHEREAS, in order to provide for the continued development of the City including the Subject Relocation by the Developer to the Subject Property the City has agreed to provide certain development assistance as hereinafter described; and WHEREAS, the City of Elgin is a home rule unit authorized to exercise or perform any function relating to its government and affairs; and WHEREAS, economic development initiatives as provided herein and maintaining the City of Elgin' s tax base and employment opportunities within the City of Elgin are matters within the government and affairs of the City of Elgin. NOW, THEREFORE, for and in consideration of the mutual promises and undertakings contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows : 1 . That the foregoing recitals are incorporated into this agreement in their entirety. 2 . That as of the entry into this agreement Developer has completed the Subject Relocation of its corporate offices to the Subject Property. 3 . That for a period of five (5) years from the date of this agreement the Developer shall maintain its corporate offices in the City of Elgin and shall retain not less than five (5) full time jobs in conjunction with its corporate offices in the City of Elgin. 4 . That in consideration of Developer providing for the Subject Relocation of its corporate offices to the Subject Property -2- as described herein the City agrees to provide the economic development assistance to Developer as set forth in this paragraph to be used by the Developer solely and only for costs associated with the Subject Redevelopment of Developer' s corporate offices to the Subject Property. Such economic development assistance from the City to the Developer shall be in the amount of a cash payment from the City to the Developer of Eight Thousand Five Hundred Twenty-One Dollars and 74/100 ($8, 521 . 74) . The City shall make such cash payment to the Developer within thirty (30) days from the date of this agreement . In addition thereto, as further economic development assistance to the Developer for the Subject Relocation by the Developer of its corporate offices to the Subject Property the City hereby forgives and waives the sum of Six Thousand Five Hundred Dollars ($6, 500 . 00) of rent due from the Developer to the City for the property at 245 Fulton Street for the months of March 2004 through July 2004 . 5 . That the parties understand and agree that the economic development assistance being provided by the City to the Developer as set forth in the preceding Paragraph 4 hereof is expressly contingent upon Developer' s Subject Relocation to the Subject Property as set forth herein. In the event the Developer fails to maintain its corporate offices in the City of Elgin for a period of five (5) years from the entry into this agreement, and/or in the event Developer fails to retain five (5) full time jobs at such corporate offices as required in the preceding Paragraph 3 hereof, the parties understand and agree that the City will not be providing any economic development assistance to the Developer for -3- the Subject Relocation to the Subject Property pursuant to this agreement or otherwise, and the Developer shall reimburse the City in full the total sum of Fifteen Thousand Twenty-One Dollars and 74/100 ($15, 021 . 74) . 6 . That this agreement shall not be deemed or construed to create an employment, joint venture, partnership, or other agency relationship between the parties hereto. 7 . That all notices or other communications hereunder shall be made in writing and shall be deemed given if personally delivered, sent by overnight courier or mailed by registered or certified mail, return receipt requested, to the parties at the following addresses, or at such other addresses for a party as shall be specified by a like notice and shall be deemed received on the date which said notice is hand delivered or the second business day following the date on which so mailed: TO THE CITY: TO THE DEVELOPER: City of Elgin E-Foods USA 150 Dexter Court Attention: Mr. Jim Wetstone Elgin, Illinois 60120-5555 107 E . Highland Avenue Elgin, Illinois 60120 Attention: City Manager 8 . That the failure by a party to enforce any provision of this agreement against the other party shall not be deemed a waiver of the right to do so thereafter. 9 . That this agreement may be modified or amended only in writing signed by both parties hereto, or their permitted successors or assigns, as the case may be . -4- • , 10 . That this agreement contains the entire agreement and understanding of the parties hereto with respect to the subject matter as set forth herein, all prior agreements and understandings having been merged herein and extinguished hereby. 11 . That this agreement is and shall be deemed and construed to be a joint and collective work product of the City and Developer and, as such, this agreement shall not be construed against the other party, as the otherwise purported drafter of same, by any court of competent jurisdiction and in order to resolve any inconsistency, ambiguity, vagueness or conflict, if any, in the terms or provisions contained herein. 12 . That this agreement is subject to and shall be governed by the laws of the State of Illinois . Venue for the resolution of any disputes or the enforcement of any rights pursuant to this agreement shall be in the Circuit Court of Kane County, Illinois . With the sole exception of an action to recover the monies the City has agreed to pay pursuant to preceding paragraph 4 hereof, and notwithstanding anything else to the contrary in this agreement, no action shall be commenced by the Developer against the City for monetary damages . In the event legal action is brought by the City for the enforcement of any of the obligations of Developer in this agreement and the City is the prevailing party in such action, the City shall also be entitled to recover from Developer reasonable interest and reasonable attorney' s fees . -5- 13 . That this agreement shall be binding on the parties hereto and their respective successors and permitted assigns. This agreement and the obligations herein may not be assigned without the express written consent of each of the parties hereto which consent may be withheld at the sole discretion of either of the parties hereto. 14 . That upon Developer' s compliance with the requirements of the preceding Paragraphs 2 and 3 hereof, Developer shall provide the City reasonable data and records of Developer which documents Developer' s compliance with the requirements of the preceding Paragraphs 2 and 3 hereof . 15 . That time is of the essence of this agreement . 16 . That the City and Developer agree that, in the event of a default by the other party, the other party shall, prior to taking any such action as may be available to it, provide written notice to the defaulting party stating they are giving the defaulted party thirty (30) days within which to cure such default . If the default shall not be cured within the thirty (30) day period aforesaid, then the party giving such notice shall be permitted to avail of itself of remedies to which it may be entitled under this agreement . 17 . That notwithstanding any other provision of this agreement it is expressly agreed and understood by the Developer that the Subject Development of the Subject Property by the Developer and the use of the Subject Property shall be in -6- accordance and in compliance with all applicable federal, state, city and other requirements of law. The Developer shall also at its expense procure all permits and licenses, pay all charges and fees, and give all other notices necessary and incident to the due and lawful prosecution of the work necessary to provide for the Subject Development of the Subject Property as described in this Agreement . 18 . That to the fullest extent permitted by law, the Developer agrees to and shall indemnify, defend and hold harmless the City, its officials, officers, employees, attorneys, agents, boards and commissions from and against any and all claims, suits, judgments, costs, attorneys fees, damages or other relief, including but not limited to worker' s compensation claims, in any way resulting from or arising out of negligent actions or omissions of the Developer in connection herewith, including negligence or omissions of employees or agents of the Developer or arising out of the performance of this agreement, and/or arising from or arising out of an alleged breach of this agreement by the Developer or the Developer' s employees or agents . In the event of any action against the City, its officials, officers, employees, attorneys, agents, boards or commissions, covered by the foregoing duty to indemnify, defend and hold harmless, such action shall be defended by legal counsel of the City' s choosing. The provisions of this paragraph shall survive any termination and/or expiration of this agreement . -7- IN WITNESS WHEREOF, the parties have entered into and executed this agreement on the date and year first written above . CITY OF ELGIN, a municipal E-FOODS USA corporation an Illinois corporation By Ed Schock, Mayor Name Title �/2T/�✓.�wr Attest : '4' A -ccts-,--- Dolonna Mecum, City Clerk F:\Legal Dept\Agreement\Development Agr-E-Foods USA.doc -8- Committee of the Whole March 9, 2005 Page 2 Consideration of the Cultural Arts Commission Grant Award Recommendations Councilmember Rodgers made a motion, seconded by Councilmember Walters, to grant funding support for the arts programming listed below recommended by the Cultural Arts Commission in the total amount of$62,857. Upon a roll call vote: Yeas: Councilmembers Figueroa, Gilliam, Rodgers, Sandor, Walters, and Mayor Schock. Nays: None. ORGANIZATION PROJECT/OPT.SUPP. AWARD Art For All Operating Support $889 Ballet Folklorico Dance Performance $6,953 Elgin Children's Chorus Voices $6,320 Elgin Choral Union Brahms'A German Requiem $5,833 Elgin Community Theatre Pippin' $5,992 Elgin Youth Symphony Every Good Boy Deserves Favor $6,627 Heartland Voices Home is Where the Heart Is $6,640 Hispanic Heritage Coalition Fiesta Salsa Cultural Entertainment $6,080 Independent Players Operating Support $4,186 Janus Theatre Stage Traffic Theatre Fest III $3,680 OPERA Die Fledermaus $6,400 SPEBSQSA-Barbershop Qt Operating Support $3,257 The total of grant awards recommended is: $62,857 Consideration of a Request for Financial Assistance for E-Foods USA Councilmember Walters made a motion, seconded by Councilmember Figueroa, to authorize a development agreement for financial assistance with E-Foods USA in the amount of$8,521.74 to cover moving expenses from the City-owned property at 245 Fulton Street. Upon a roll call vote: Yeas: Councilmembers Figueroa, Gilliam, Rodgers, Sandor, Walters, and Mayor Schock. Nays: None. Consideration of Proposed Guidelines for the Property Improvement Grant Program Councilmember Sandor questioned why the standards regarding siding removal/replacement are more restrictive in this program than what is allowed in the Far West Area. After discussion, staff was directed to change the proposed guidelines to include the provision that if more than 51% of siding is replaced, any product that is permitted in the Far West Area plan is acceptable for this program. Councilmember Figueroa made a motion, seconded by Councilmember Rodgers, to approve the proposed guidelines for the Property Improvement Grant Program including the change discussed above. Upon a roll call vote: Yeas: Councilmembers Figueroa, Gilliam, Rodgers, Sandor, Walters, and Mayor Schock. Nays: None. Consideration of the Removal of the Gate at the Eastern Boundary of Stockbridge Place L . G --!.. '-` t March 4, 2005 1 TO: Mayor and Members of the City Council --� ECONOMIC GROWTH FROM: Olufemi Folarin, City Manager Cherie Murphy, Economic Development Coordinator SUBJECT: Request for Financial Assistance for E-Foods USA PURPOSE The purpose of this memorandum is to provide the Mayor and members of the City Council with information to consider a request from E- Foods USA for financial assistance in relocating its business from City-owned property at 245 Fulton Street to 107 E Highland Avenue in Elgin. RECOMMENDATION It is recommended that the City Council authorize a development agreement with E-Foods USA in the amount of $8,521.74 to cover moving expenses from the City-owned property at 245 Fulton Street. BACKGROUND E-Foods USA moved to Elgin in 2002 from Des Plaines, Illinois, with financial assistance from the E-Elgin grant program. The business brought seven jobs to downtown Elgin, including five with salaries greater than $40,000. At the time, E-Foods USA signed a lease with Shales Partnership for space at 245 Fulton Street with the intent of staying at that location. In September 2003, E-Foods USA was notified by Shales Partnership of the termination of their lease as of November 30, 2003, due to the sale of the property to the City of Elgin for construction of a parking deck. A month-to-month lease extension was negotiated for E-Foods USA to stay until such time that the City of Elgin notified them of the need to vacate the property. In the spring of 2004, City staff began working with E-Foods USA to identify a suitable space within the downtown area. Space at 107 E. Highland was found to be the most suitable, available site for current and future needs of the company. The owner of the building worked with E-Foods and the City of Elgin to negotiate the lease. Where appropriate, E-Foods obtained three quotes for all move-related costs and chose the lowest bidder. Based on anticipated financial support from the city, E-Foods USA moved into the building on July 29`h E-Foods USA is requesting assistance with the expenses associated with this move and has provided the City with a listing of all relocation expenses. They are also requesting ' E-Foods USA Request March 4, 2005 Page 2 compensation for the increased rent at the new location for the remaining time of their original lease. The following is a detailed breakdown of their request: Berna Moving& Storage-office move $ 462.25 FRF Transport- Server Move $ 675.00 SBC- Moving phone service $ 209.70 MCI- Moving T-1 lines $ 186.57 New letterhead, checks etc. $1,138.22 Subtotal $2,671.74 Increase of rental costs $10,400.00 Security deposit return $ 1,950.00 Total Request $15,021.74 From this requested amount, the City would deduct $6,500 for unpaid rent for the months of March, 2004, through July, 2004, at which time they vacated the property. Deducting 5 months, at $1,300 per month, would bring the recommended compensation down to a total of$8,521.74. The development agreement will also require that the business stay at the new location a minimum of 5 years and maintain a minimum of 5 full-time employees. This development agreement enables the City to fulfill the wishes indicated by Council to assist this business in relocating in Elgin. Without such an agreement it would not be financially beneficial for E-Foods to remain in downtown Elgin, and could cause the City to lose not only the current 5 jobs at $40,000, but also future jobs that might be created as the business expands. COMMUNITY GROUPS/INTERESTED PERSONS CONTACTED None FINANCIAL IMPACT The total cost associated with the development agreement with E-Foods USA is $8,521.74. The total 2005 budget for the Economic Development Incentives Program in the Riverboat Lease Fund, account number 276-0000-791-80-27, is $300,000. Commitments have already been made to Rieke Office Supply ($20,000) and Elgin Toyota for site clean-up ($75,000) leaving $205,000 available for this initiative. . LEGAL IMPACT A development agreement would be required. .�°''� s E-Foods USA Request March 4, 2005 Page 3 ALTERNATIVES 1. Approve the request for$8,521.74 in assistance. 2. Choose not to approve the request for assistance from E-Foods USA. Respectfully submitted for Council consideration. Attachments