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1i. Trust for Public Lands Agreement.1 1 MEMORANDUM CITY OF I-XI CHANHASSEN 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 (612) 937 -1900 0 FAX (612) 937 -5739 ' TO: Mayor and City Council ' FROM: Alison Blackowiak and Nancy Mancino, Co- Chairs Park Referendum Task Force DATE: August 7, 1996 SUBJ: Seeking Approval to a Final Agreement with the Trust for Public Land; Park ' Referendum Task Force The Park Referendum Task Force was formed in June of 1995. The goal of the task force is to work with the Park & Recreation Commission and city council on forwarding a special referendum to the citizenry of Chanhassen. It is our hope to complete this task in June of 1997. ' Since the inception of the task force, we have considered working with the Trust for Public Land (TPL), a non - profit public benefit corporation, for several reasons. These include: • They are a non - profit organization whose single mission is to preserve land for public benefit. • The organization has been fulfilling this mission since 1972, and have gained considerable experience, which our task force could never duplicate. • To date they have put into public trust more than 1 million acres of land for public use, with an appraised value of over $1,000,000,000. • They have an established process, and are prepared to help the task force plan and coordinate our efforts. ' • Their organization is compensated only if they successfully negotiate a favorable transaction between select landowners and Chanhassen. • The task force believes that property owners may be more receptive to overtures from a ' respected non - profit organization than negotiating directly with the city. (This was reinforced when we spoke with other communities that have worked with TPL.) • As non - profit, the Trust for Public Land can offer tax benefits to landowners and can ' structure transactions that save money for government agencies. • They are prepared to contribute $5,000 towards a Public Opinion Survey. ' Finally, the Trust for Public Land comes highly recommended from the cities we contacted that have worked with them. Mayor and City Council August 7, 1996 Page 2 At this point you may want to know where we are in the "referendum process," and what are the implications of approving this agreement. • The task force has determined that there is sufficient interest in acquiring open space, constructing trails and developing existing parks to warrant conducting a formal survey of Chanhassen residents. The results of this survey will gauge the public's willingness to pass a bond referendum. • If the survey indicates that a bond referendum is likely to pass, Chanhassen will want this agreement in place so we can begin the process of negotiating options on select parcels prior to the actual referendum, so that these parcels can be purchased at the most reasonable price. • If the survey indicates that a bond referendum is certain to fail, the agreement contains a provision terminating Chanhassen's relationship with the Trust for Public Land. • Upon the council's approval of this agreement, the task force will begin to work with the Trust for Public Land to develop a survey instrument and a general program schedule. It is our intention to field the survey sometime after the general election. • If the survey indicates favorable public support, a special referendum is likely to be held next spring, so as not to coincide with this fall's general election. The representatives of the city who have worked on this agreement include Councilman Steve Berquist, City Attorney Roger Knutson, Park and Recreation Director Todd Hoffman, and ourselves. We have been working with Cynthia Whitesford, Regional Manager for TPL, and their attorney, Maggie Madden. The agreement we are presenting to you represents the culmination of 4 -5 draft documents. We feel the agreement is fair to the city and TPL, is written in language that can be defined, and opens the door to a valuable partner in our open space acquisition efforts. Please read the agreement in full. Some of the basic components of the agreement include: • Chanhassen has identified the need for open space acquisition. • The city does not have sufficient funds at this time to purchase the properties. • Chanhassen and TPL acknowledge that TPL has and will expend significant time, money and expertise in assisting Chanhassen except as set forth in Section 4 of the agreement, Chanhassen will not compensate TPL for its time and expense in acquiring the properties and conveying them to Chanhassen. Rather, TPL will earn support for itself from the land owners who sell the properties to TPL. u 1 I 0 C L r u C ' Mayor and City Council August 7, 1996 Page 3 • Chanhassen agrees that it is a priority that public funds be made available for future acquisition of the properties. Chanhassen will conduct public opinion survey(s) to assess the likelihood of success of the citizens of Chanhassen passing a bond referendum. • TPL agrees to use all reasonable efforts as an independent non - profit organization to support and further public financing for such acquisitions including the provision of technical ' assistance and agrees to reimburse direct expenses incurred by Chanhassen in an amount not to exceed $5,000. ' • If the parties agree that the results of the public opinion survey(s) indicate that the bond referendum is likely to be passed by the voters of Chanhassen, TPL will attempt to negotiate for the acquisition and subsequent conveyance of one or more of the properties to Chanhassen. • TPL is acting as an independent contractor and not as an agent or employee of the city. ' • TPL at its own exp ense, will contract for an appraisal of a property if it has or if it is P � pP p P Y ' determined that it is likely to obtain site control of said property. • If Chanhassen approves of the appraisal and agrees to acquire a property at fair market value ' established by the appraisal, TPL and Chanhassen will enter into a purchase and sale agreement. • In the event that TPL determines it is unable to obtain an option on a property, as contemplated herein, TPL shall notify Chanhassen and the parties shall mutually agree either to 1) terminate any further obligations of TPL and Chanhassen hereunder with respect to such ' property, or 2) enter into a mutually agreed upon professional services contract with respect to such property. is • The term of this agreement shall be from the effective date to, through, and including December 31, 1997. RECOMMENDATION This agreement allows Chanhassen control of all foreseeable contingencies, with future decision points controlled by vote of the city council. It also employs the considerable experience of a skilled negotiating organization, and affords them economic opportunity with no premium cost to Chanhassen.. It is the recommendation of the Park Referendum Task Force that the city council approve the attached agreement with the Trust for Public Land. If you have any questions, please call either Alison Blackowiak at 949 -1183 or Nancy Mancino at 474 -3861 or 332 -5190. It would our pleasure to answer your questions. CAMPBELL, KNUTSON, SCOTT & FUCHS, P.A. Attorneys at Law Thunwa j. caml'I'di Ro, cr N. KnUCJUn Thomas M. Scutt G,uy G. Fuchs James K. Watstun Elliott R. Knctsch Sues,ul Pace (612) 452 -5000 Andrc,i Nlct),m I'uchlc, ti4��tthc%� K. t3rukt Fax (612) 452 -5550 john F. Kelk \L11(-'ucritc M. McQIiion Gcur(7c T. Stcphenson July 31, 1996 Mr. Todd Hoffman City of Chanhassen 690 Coulter Drive, Box 147 Chanhassen, Minnesota 55317 RE: Agreement with The Trust for Public Land Dear Todd: Enclosed please find two originals of the revised Agreement with The Trust for Public Land ( "TPL ") which incorporates the comments set forth in my correspondence of July 12, 1996. Very truly yours, KNUTSON, SCOTT Roger N. Knutson RNK: srn Enclosures RECEIVED AU 01 1996 r !TY OF CHANHASSEN Suite 317 • Eaoandale Office Center • 1380 Corporate Center Curve • Ewan, MN 55 1 -1 r L L L AGREEMENT THIS AGREEMENT entered into as of the Effective Date (as defined below) by and between the CITY OF CHANHASSEN, a Minnesota municipal corporation ( "Chanhassen "), and THE TRUST FOR PUBLIC LAND, a nonprofit California public benefit corporation authorized to do business in Minnesota as The Trust for Public Land, Inc. ( "TPL "). RECITALS A. Chanhassen has identified for acquisition for public, open space and recreational purposes certain real properties located in Chanhassen described on Exhibit A attached hereto and made a part hereof, (collectively, the "Properties" and singularly, "Property "). B. Chanhassen does not have sufficient funds at this time to purchase the Properties and seeks TPL's assistance in acquiring the Properties and in passing a bond referendum to raise the funds for its acquisition. C. TPL is a national nonprofit organization that works with citizen groups, communities and public agencies to help acquire lands of environmental, recreational, historic or cultural significance. TPL obtains the resources to carry out its mission from various sources, among which are foundation grants, government funds, contributions of land value by property owners, loans and professional services fees. D. Chanhassen and TPL acknowledge that TPL has and will expend significant time, money and expertise in assisting Chanhassen in (1) developing the funding sources for acquisition of the Properties and (2) attempting to negotiate for the acquisition and subsequent conveyance in a simultaneous closing to Chanhassen of one or more of the Properties. Except as set forth in Section 4, Chanhassen will not compensate TPL for its time and expense in acquiring the Properties and conveying them to Chanhassen. Rather, TPL will earn support for itself from the landowners who will sell the Properties to TPL. NOW, THEREFORE, THE PARTIES AGREE TO THE FOLLOWING: FUNDING a. Chanhassen Chanhassen agrees that it is a priority that public funds be made available for future acquisition of the Properties. Chanhassen will conduct public opinion survey(s) ( "Public Opinion Surveys ") to assess the likelihood of success of the citizens of 1 1 1 Chanhassen passing a bond referendum authorizing Chanhassen to sell its general obligation bonds to purchase open space (the "Bond Referendum"). b. TPL TPL agrees to use all reasonable efforts as an independent, nonprofit organization to support and further public financing for such acquisitions, including the provision of technical assistance and agrees to reimburse direct expenses incurred by Chanhassen in an amount not to exceed $5,000 in connection with the Public Opinion Surveys. TPL shall also assist Chanhassen in identifying private, foundation and other governmental funding sources for the acquisition by Chanhassen of the Properties. C. Acquisition Services Based on Results of Public Opinion Surveys If the parties agree that the results of the Public Opinion Surveys indicate that the Bond Referendum is likely to be passed by the voters of Chanhassen, TPL will attempt to negotiate for the acquisition and subsequent conveyance of one or more of the Properties to Chanhassen. Chanhassen understands that TPL is willing to provide the technical assistance and funding described in Section 1(b) in exchange for the opportunity to acquire the Properties in the manner described in this Agreement. 2. INDEPENDENT CONTRACTOR TPL is acting as an independent contractor and not as an agent or employee of Chanhassen. TPL shall pursue the acquisition of the Properties after consultation with Chanhassen as to Chanhassen's priority of acquisition of the Properties. TPL, as an independent entity, shall negotiate with the owners of the Properties (collectively, "Landowners" and singularly, "Landowner "), and in consultation with Chanhassen to the extent permitted in Section 6, to obtain an option to acquire the Properties through fee purchase (or exchange, if appropriate). TPL will use all reasonable efforts to negotiate an option term for each Property with rights to extend the option term which is sufficiently long so that the option will not expire prior to the availability of public funds from the Bond Referendum. Chanhassen understands and agrees that TPL at its sole discretion will attempt to negotiate a purchase price for each Property which will be a percentage of the fair market value of the Property as prescribed by an appraisal reviewed and approved by Chanhassen. PURCHASE BY CHANHASSEN a. Appraisal TPL, at its own expense, will contract for an appraisal of a Property if it has or if it determines that it is likely to obtain site control of said Property. The appraisal shall be prepared by an appraiser selected by TPL and mutually acceptable to Chanhassen. Chanhassen will review each appraisal within thirty (30) days of TPL delivering to Chanhassen an appraisal of a Property. Within said thirty (30) day period, Chanhassen will notify TPL if (I) it approves of the appraisal and (ii) it is willing to purchase the Property at the fair market value established by the appraisal. b. Purchase and Sale Agreement If Chanhassen approves of the appraisal and agrees to acquire a Property at the fair market value established by the appraisal, TPL and Chanhassen will enter into a purchase and sale agreement (or other similar agreement, including but not limited to assignment of option) the terms and conditions of which shall be mutually agreed upon 2 C L 7 J J by TPL and Chanhassen. TPL understands and agrees that a condition to Chanhassen's obligation to perform under any purchase and sale agreement will be the passage of the Bond Referendum and the sale of bonds and such contingency will be set forth in the purchase and sale agreement. It is TPL's intent to acquire each Property and simultaneously convey it to Chanhassen. Chanhassen agrees to cooperate in coordinating such a simultaneous closing. 4. ALTERNATIVES TO PURCHASE AND SALE AGREEMENT a. TPL is Unable to Obtain an Option In the event that TPL determines it is unable to obtain an option on a Property as contemplated herein, TPL shall notify Chanhassen and the parties shall mutually agree either to: (I) terminate any further obligations of TPL and Chanhassen hereunder with respect to such Property, or (ii) enter into a mutually agreed upon professional services contract with respect to such Property. b. TPL Does Not Exercise an Option In the event that TPL has an option on a Property and determines not to exercise it, TPL shall notify Chanhassen and except as set forth below, the obligations of TPL and Chanhassen hereunder with respect to that Property shall terminate. TPL, at the request of Chanhassen, will assign such option to Chanhassen for a fee equal to three percent (3 %) of the purchase price stated in TPL's option with the Landowner plus TPL's direct expenses incurred in connection with that Property, including but not limited to, option consideration, appraisal fees, environmental audit and inspection expenses, survey and abstracting and title commitment fees, but excluding TPL staff time and overhead. C. Right of First Refusal In the event that TPL obtains a right of first refusal for the purchase of a Property which has a term exceeding one year, TPL, at its sole discretion, shall notify Chanhassen, and at Chanhassen's request, shall assign such right of first refusal to Chanhassen under the same terms and conditions as provided herein for an assignment of an option. In any case, TPL will use good faith efforts to facilitate the acquisition of such Property by Chanhassen. 5. TIMING Chanhassen and TPL shall mutually establish clear and reasonable timelines for the completion of the acquisition for each Property, and Chanhassen and TPL shall diligently pursue the completion of their reviews and administrative functions necessary for each such acquisition within a mutually acceptable timeframe. 6. COMMUNICATION To facilitate consistent communications and allow effective negotiations, TPL shall maintain and direct all communications, written and oral, with the Landowners regarding the acquisition of their Properties until TPL notifies Chanhassen that it is no longer negotiating with a Landowner or that it does not intend to exercise an option or right of first refusal on a Property. TPL's negotiations and final terms of purchase shall be completely confidential to the extent requested by a Landowner. To the extent TPL is allowed hereunder, TPL shall provide status reports with respect to the progress of its negotiations on each Property 3 J in the time and manner requested by Chanhassen. Any information provided by TPL to Chanhassen shall be subject to the requirements of Minnesota Statutes Chapter 13. 7. NAME TPL shall use its full name "The Trust for Public Land" in all contacts and correspondence with Landowners and the public and shall identify itself as a nonprofit land conservation organization. 8. NOTICES The contact persons for the purposes of communication with respect to this Agreement shall be: TPL: Ms. Cynthia M. Whiteford The Trust for Public Land 420 North Fifth Street, Suite 865 Minneapolis, Minnesota 55401 Tel: (612) 338 -8494 Fax: (612) 338 -8467 Chanhassen: Mr. Todd Hoffman City of Chanhassen 690 Coulter Drive, Box 147 Chanhassen, Minnesota 55317 Tel: (612) 937 -1900 Fax: (612) 937 -5739 9. TERM The terms of this Agreement shall be from the Effective Date to, through and including December 31, 1997 (the "Termination Date "), except that Chanhassen may terminate this Agreement at anytime upon ten (10) days written notice to TPL. Subsequent to termination, Chanhassen and TPL shall be bound by the terms and conditions of any separate agreements, including but not limited to purchase and sale agreements, entered into prior to termination of this Agreement. In the event Chanhassen elects to terminate this Agreement prior to the Termination Date, upon such termination, Chanhassen will pay all of TPL's direct expenses incurred as of the date of such termination, including but not limited to, appraisal fees, environmental investigation and audit expenses, survey and abstracting and title commitment fees, but excluding TPL staff time and overhead and excluding option consideration payments made by TPL unless an option is assigned to Chanhassen pursuant to Section 4.b. of this Agreement. In the event this Agreement is terminated prior to the Termination Date, TPL shall be under no obligation to assign any option on the Properties it may hold at the time of such termination. 4 J r FI 1 IN WITNESS of the foregoing provisions, the parties have executed and delivered this Agreement as of the date set forth below. The effective date (the "Effective Date ") of this Agreement shall be the last date of execution by either of the parties to this Agreement. CITY OF CHANHASSEN, a THE TRUST FOR PUBLIC LAND, Minnesota municipal a nonprofit California public corporation benefit corporation By: Donald J. Chmiel, Mayor Don Ashworth, City Manager Date: F:\nlaggie\profserv\2chanhasn.mou By: Title: By:_ Title: Date: 5 EXHIBIT A 1 s �