05-268 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
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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
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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 .
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•
,
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 .
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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
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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 .
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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
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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