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14-161 Resolution No. 14-161 RESOLUTION AUTHORIZING EXECUTION OF AN ECONOMIC INCENTIVE AGREEMENT WITH HANSEN PLASTICS CORPORATION (2750 Alft Lane) BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS, that David J. Kaptain, Mayor, and Kimberly A. Dewis, City Clerk, be and are hereby authorized and directed to execute an Economic Incentive Agreement with Hansen Plastics Corporation on behalf of the City of Elgin for economic development assistance in connection with the development of 2750 Alft Lane, a copy of which is attached hereto and made a part hereof by reference. s/David J. Kaptain David J. Kaptain, Mayor Presented: November 5, 2014 Adopted: November 5, 2014 Omnibus Vote: Yeas: 9 Nays: 0 Attest: s/ Kimberly Dewis Kimberly Dewis, City Clerk ECONOMIC INCENTIVE AGREEMENT This Economic Incentive Agreement (the "Agreement") is made and entered into as of this 5th day of November 2014, by and between the City of Elgin, an Illinois municipal corporation (hereinafter referred to as the "City"), and Hansen Plastics Corporation, a Del- aware corporation ("Hansen Plastics"). WHEREAS, Hansen Plastics) has been manufacturing small, precision injection molded parts in Elgin since 1971; and WHEREAS, Hansen Plastics fabricates products for diverse industries—medical, life safety, building and construction, consumer products, transportation and agriculture; and WHEREAS, Hansen Plastics at any given time is manufacturing a plethora of plas- tics products in each of its more than thirty injection molding machines, including nail gun casings, sprinkler spigots and fire detector and water softener parts; and WHEREAS, Hansen Plastics' founder, Elmer Hansen, established the company's credo "do it right the first time," and this has meant reinvesting in employees and state-of- the-art technology to grow the business; and WHEREAS, Hansen Plastics established an employee stock ownership plan (ESOP) to enable the employees to buy the company, with the employees buying the first third of the company in 1991 and by 1998 assuming full ownership of the business; and WHEREAS, Hansen Plastics' 114 employee-owners average ten years of working with the company; and WHEREAS, Hansen Plastics is seeking to invest approximately $3.1 million to es- tablish a new manufacturing facility in Elgin at merge the operations of its existing facilities at 1270 Abbott Drive and Sundown Road in South Elgin in a new facility at 2750 Alft Lane which will bring 60 new manufacturing jobs to Elgin ("Subject Project"); and WHEREAS, to induce Hansen Plastics into proceeding with the Subject Project, the City will waive the building permit fees associated with the construction of the Subject Pro- ject, and; WHEREAS, Hansen Plastics would not have been inclined to proceed with the Sub- ject Project in Elgin without certain economic development assistance from the City; and WHEREAS, section 8-11-20 of the Illinois Municipal Code (65 ILCS 518-11-20) au- thorizes municipalities including the City to enter into economic incentive agreements relat- 6_�17 ing to the development or redevelopment of lands within the corporate limits of a munici- pality; and WHEREAS, the City is a home rule unit authorized to exercise any power and per- form any function relating to its government and affairs; WHEREAS, economic incentive agreements including the economic incentive agreement as provided for in this agreement pertain to the government and affairs of the City; and WHEREAS, the Subject Project is expected to create job opportunities within the City; and WHEREAS, the Subject Project will serve to further the development of adjacent ar- eas; and WHEREAS, Hansen Plastics meets high standards of credit worthiness and finan- cial strength; and WHEREAS, the Subject Project will strengthen the commercial and industrial sector of the City; and WHEREAS, the Subject Project will enhance the tax base of the City; and WHEREAS, this agreement is made in the best interests of the City. NOW, THEREFORE, for and in consideration of the mutual promises and undertak- ings contained herein, and other good and valuable consideration, the receipt and suffi- ciency of which are hereby acknowledged, the parties hereto agree as follows: 1. Recitals. The foregoing recitals are incorporated into this Agreement in their en- tirety. 2. Subject Project. Hansen Plastics, at its cost, shall develop the Subject Project. The development of the Subject Project shall conform in all respects with all applicable legal requirements, including, but not limited to, city ordinances and codes, the terms of this Agreement, or as otherwise directed by the City as is necessary to comply with ordi- nances, building codes or other requirements of law. Except as otherwise provided in this Agreement, all costs and expenses relating to the Subject Project shall be the responsibil- ity of and shall be paid for by Hansen Plastics. 3. Economic Incentives. In consideration for Hansen Plastics' undertaking of the Subject Project, the City agrees to provide economic incentives to Hansen Plastics to be 2 used by Hansen Plastics solely and only for the Subject Project. Such economic incentives shall consist of and be distributed to Hansen Plastics as follows: "Fast-Track"Permitting Process and Waiver of Building Permit Fees for the Subject Project. The City agrees to conduct a "fast-track" permitting process for the Subject Project and agrees to waive and not require Hansen Plastics to incur the costs of any building permit fees which have been paid or would otherwise be due and pay- able to the City in connection with the establishment of the Subject Project. The provisions of this section are intended and shall be construed to apply only to the building permit fees. Any and all impact fees or other fees which may be due and owing to the City and/or any other governmental entity other than the City shall be paid by Hansen Plastics. The City's reimbursement of building permit fees paid by Hansen Plastics or any contractor for the Subject Project shall be paid to Hansen Plastics within thirty (30) days of Hansen Plastics obtaining a certificate of occupan- cy from the City for the Subject Project. Should Hansen Plastics expand the Subject Proiect into other areas of the building at 2750 Alft Lane, the "fast-track" permitting process and waiver of building permit fees described in this paragraph shall apply to any such expansion of the Subject Project. Hansen Plastics shall maintain the Subject Proiect for aperiod of ten (1 Q)years from the date of the issuance of a certificate of occupancy. In the event Hansen Plastics fails to maintain the Subject Proiect for said ten-year period, Hansen Plastic shall re- imburse to the City the cost of all building permit fee and development fees waived by the City under the terms of this paragraph and-Agreement. 4. Miscellaneous. A. That this Agreement shall not be deemed or construed to create an employment, joint venture, partnership, or other agency relationship between the parties hereto. B. That all notices or other communications hereunder shall be made in writing and shall be deemed given if personally delivered or mailed by registered or certified mail, re- turn receipt requested, to the parties at the following addresses, or at such other ad- dressed for a party as shall be specified by like notice, and shall be deemed received on the date on which said hand delivered or the second business day following the date on which so mailed: TO THE CITY: TO HANSEN PLASTICS: City of Elgin Mr. Roy Lilly 150 Dexter Court CEO and President Elgin, IL 60120-5555 Hansen Plastics Corporation 3 Attention: Richard G. Kozal 1270 Abbott Drive Assistant City Manager Elgin, IL 601 23-1 81 9 With a copy of any such notice to: City of Elgin 150 Dexter Court Elgin, IL 60120-5555 Attention: William A. Cogley, Corporation Counsel C. 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. D. 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. E. That this Agreement contains the entire agreement and understanding of the par- ties hereto with respect to the subject matter as set forth herein, all prior agreements and understandings having been merged herein and extinguished hereby. F. That this Agreement is and shall be deemed and construed to be a joint and col- lective work product of the City and Hansen Plastics and, as such, this Agreement shall not be construed against the other parry, as the otherwise purported drafter of same, by any court of competent jurisdiction in order to resolve any inconsistency, ambiguity, vagueness or conflict, if any, in the terms or provisions contained herein. G. That this Agreement is subject to and shall be governed by the laws of the State of Illinois. H. 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 the parties hereto. The City may record a Memorandum of Agreement placing of record the terms and provisions of this Agreement. I. The City and Hansen Plastics agree that, in the event of a default by the other party, the other party shall, prior to taking any such actions as may be available to it, pro- vide written notice to the defaulting party stating that they are giving the defaulting party thirty(30) days within which to cure such default. If the default shall not be cured within the thirty (30) days period aforesaid, then the party giving such notice shall be permitted to avail itself of remedies to which it may be entitled under this Agreement. 4 (A J. If either party fails or refuses to carry out any of the material covenants or obliga- tions hereunder, the other party shall be entitled to pursue any and all available remedies as specified herein or otherwise available at law, equity or otherwise. Notwithstanding the foregoing or anything else to the contrary in this Agreement, with the sole exception of an action to recover the monies the City has agreed to pay pursuant to the preceding para- graph 3 of this Agreement, no action shall be commenced by Hansen Plastics against the City for monetary damages. 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. In the event any action is brought by the City against Hansen Plastics or its permitted as- signs with respect to this Agreement and the City is the prevailing party in such action, the City shall also be entitled to recover from Hansen Plastics reasonable interest and reason- able attorney's fees. Notwithstanding anything to the contrary stated herein or otherwise, HANSEN PLASTICS' AGGREGATE LIABILITY UNDER THIS AGREEMENT AND IN CON- NECTION WITH ITS RECEIPT OF THE ECONOMIC INCENTIVE DESCRIBED HEREIN SHALL BE EXPRESSLY LIMITED TO THE AMOUNTS RECEIVED BY HANSEN PLASTICS FROM THE CITY IN CONNECTION WITH THIS AGREEMENT AND SUCH ECONOMIC INCENTIVE. Hansen Plastics shall have no other liability whatsoever, whether based on breach of contract, negligence, strict liability or any other claim and under no circumstanc- es shall Hansen Plastics be liable for lost profits or revenues, special incidental, indirect, consequential or exemplary damages incurred by the City or any third party. K. Time is of the essence of this Agreement. L. This Agreement shall be construed, and the rights and obligations of the City and Hansen Plastics hereunder shall be determined in accordance with the laws of the State of Illinois without reference to its conflict of laws rules. M. No past, present or future elected or appointed official, officer, employee, attor- ney, agent or independent contractor of the City shall be charged personally or held con- tractually liable under any term or provision of this Agreement including, but not limited to, because of their negotiation, approval, execution or attempted execution of this Agree- ment. N. Notwithstanding any other provisions of this Agreement, it is expressly agreed and understood by Hansen Plastics and the City that in connection with the performance of this Agreement, that Hansen Plastics shall comply with all applicable federal, state, city and other requirements of law including, but not limited to, any applicable requirements regarding prevailing wages, minimum wage, workplace safety and legal status of employ- ees. Without limiting the foregoing, Hansen Plastics hereby certifies, represents and war- rants to the City that all of Hansen Plastics employees and/or agents who will be employed for the Subject Project shall be legal residents of the United States. Without limiting the foregoing, and notwithstanding anything to the contrary in this Agreement, Hansen Plas- tics and its contractors and subcontractors shall comply with the Prevailing Wage Act in all respects relating to the Subject Project. The City shall have the right to audit any records in 5 the possession or control of Hansen Plastics to determine Hansen Plastics compliance with the provisions of this section. In the event the City proceeds with such an audit, Han- sen Plastics shall make available to the City Hansen Plastics relevant records at no cost to the City. Hansen Plastics shall also pay any and all costs associated with any such audit. If so desired by Hansen Plastics, the audit shall, to the extent permitted by law, be subject to reasonable confidentiality restrictions set forth in a confidentiality agreement agreed to by the parties. The provisions of this section shall survive any termination, completion and/or expiration of this Agreement. O. Hansen Plastics, on behalf of itself and its respective successors, assigns and grantees hereby acknowledges the propriety, necessity and legality of all of the terms and provisions of this Agreement and does hereby further agree and does waive any and all rights to any and all legal or other challenges or defenses to any of the terms and provi- sions of this Agreement and hereby agrees and covenants on behalf of itself and its suc- cessors, assigns and grantees of the Subject Property, not to sue the City or maintain any legal action or other defenses against the City with respect to any challenges of the terms and provisions of this Agreement. The provisions of this section shall survive any termina- tion, completion and/or expiration of this Agreement. IN WITNESS WHEREOF, the City and Hansen Plastics have executed this Agree- ment on the date and year first written above. CITY OF ELGIN, HANSEN PLASTICS CORPORATION By4E6,did B . Kap ain, ayor �Its: 1,406 n:_:r Attest: imberiy"Dewis, City 6erk 6 ELGIN MEMORANDUM THE CITY IN THE SUBURBS- To: Mayor and City Council Members From: Richard G. Kozal, Assistant City Manager Date: 5 November 2014 Re: Hansen Plastics Corporation Economic Incentive Agreement The committee of the whole memorandum describing the economic incentive agreement with Hansen Plastics Corporation estimated the building permit fee waiver will total approximately $122,000 to complete the partially constructed building it will occupying at 2750 Alft Lane. When finalizing the terms of the economic incentive agreement, Hansen Plastics asked to receive credit for the building permit fees that have already been expended in constructing the building since those fees will be absorbed in the multi-year lease Hansen Plastics will be signing for a portion of the building. The building permit fees to date at 2750 Alft Lane total approximately $246,000 and Hansen Plastics will initially be occupying approximately sixty percent of the building. The prorated credit for the building permit fees for which Hansen Plastics would receive credit is $147,600. This credit is consistent with prior economic incentive agreements such as that with American NTN Bearing Manufacturing Corporation in which the city waived all building permit fees for the construction of a its new facility on Holmes Road. The agreement with Hansen Plastics requires the company to remain at 2750 Alft Lane for not less than ten years as a condition to the building permit fee waivers. Please contact me should you have questions or desire additional information. c. Sean R. Stegall