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HomeMy WebLinkAboutRevised Special Rate Agreement - I-N Tek and I-N Kote1316 COUNTY -CITY BUILDING 227 W. JEFFERsoN BOULEVARD SOUTH BEND. INDIANA 46601-1830 CITY OF SOUTH BEND PETE BUTTIGIEG, MAYOR BOARD OF PUBLIC WORKS February 23, 2017 Thomas Cayia UN Tek and IIN Kote L.P. 30755 Edison Road New Carlisle, IN 46552 PHONE 574/235-9251 FAX 574/235-9171 RE: Revised Special Rate Agreement Dear Mr. Cayia: The Board of Public Works, at its meeting held on February 23, 2017, approved the above referenced no cost revision to page one (1) of the Special Rate Agreement. Enclosed please find a copy of the agreement for your records. If you have any further questions regarding this matter, please call this office at (574) 235- 9251. Sincerely, Linda) M. Martin, Clerk l Enclosure c: Michael Schmidt, Legal GARY A. GILOT SUZANNA M. FRITZBERG ELIZABETH A. MARADIK JAMES A. MUELLER Tf ERESE J. DORAU SPECIAL RATE AGREEMENT Between THE CITY OF SOUTH BEND INDIANA And I/N TEK L.P., a Delaware Limited Partnership 0 I/N KOTE L.P., a Delaware Limited Partnership Regarding WASTE WATER FEES This Special Rate Agreement ("Agreement") is entered effective the 151 day of January, 2017, by and between the City of South Bend, Indiana ("City") acting by and through its Board of Public Works ("Board") and I/N Tek L.P., a Delaware Limited Partnership & I/N Kote L.P., a Delaware Limited Partnership (collectively "I/N Tek") for the treatment of waste water. WHEREAS, I/N Tek L.P. is currently a wastewater customer of the City and desires to remain a wastewater customer of the City for the duration of this Agreement; and WHEREAS I/N Kote, L.P. is a party to this Agreement as it is a joint operator with I/N Tek L.P. who shares costs for the treatment of waste water provided by City and therefore has third party rights under this Agreement; and WHEREAS, the City desires to keep I/N Tek as a wastewater customer; and WHEREAS, pursuant to Section 17-29 of the City's Code, the City's Common Council ("Common Council") must approve this Agreement prior to it becoming effective; and WHEREAS, in recognition of factors solely unique to I/N Tek, the City hereby acknowledges the following comprehensive list of factors, when taken in aggregate, support the justification of a special rate for wastewater services due to the public benefit received by the City: a. I/N Tek has been a wastewater customer since May 30, 1989, b. at an approximate cost of $8,700,000, which was funded through St. Joseph County TIF, I/N Tek constructed two (2) dedicated wastewater sewer lines between 1989-1991 from its facility to the City's treatment center; c. I/N Tek, at the City's request, constructed these two (2) wastewater sewer lines at a location, depth and size which accommodated the City's interest in future City development in the vicinity of the wastewater sewer lines, d. upon completion of the dedicated wastewater sewer lines, I/N Tek transferred ownership of the dedicated wastewater sewer lines to the City, e. the approximate cost, in 2017 dollars, for the City to construct (2) wastewater sewer lines of similar size and location to the two (2) lines constructed by I/N Tek is $16,000,000, f. the wastewater sewer lines led to the development of the real property more commonly known as the Blackthorn district, g. I/N Tek manages its own storm water issues, thus mitigating any potential capital investments from the City as it relates to the City's combined sewer overflow issue, and other waste treatment issues. h. I/N Tek's construction and subsequent dedication of the two (2) wastewater sewer lines created public benefits to the City that justify the approximate $3,200,000 rate credit offered herein pursuant to the calculations found in paragraph 2 of the Agreement. NOW, THEREFORE, in consideration of the obligations, terms and conditions contained herein, the adequacy of which the parties expressly acknowledge, the City and I/N Tek agree as follows: 1. INCORPORATION OF RECITALS The Recitals are incorporated into the operative provisions of this Agreement as if fully set out herein. 2. RATE In recognition of the unique facts set forth above surrounding I/N Tek's customer relationship with the City and I/N Tek's capital contribution to the City's wastewater infrastructure, the City hereby grants a special rate to I/N Tek in the amount as set forth below: January 1, 2017 through December 31, 2017 — 5% reduction in the rate determined by Section 17-21 of the City Code ("Base Rate"). Section 17-21 of the City Code is incorporated herein by reference as if fully set out in this Agreement. January 1, 2018 through December 31, 2018 — 10% reduction in Base Rate. January 1, 2019 through December 31, 2026 — 14% reduction in Base Rate. I/N Tek shall also pay the surcharge under Section 17-81 of the City Code as well as any other surcharge applicable under the City Code, including but not limited to, Section 17-23 of the City Code which addresses heavy demand. I/N Tek shall promptly pay the City in a manner consistent with the City's routine billing services the net amount due under the special rate (Base Rate, less credit, plus applicable surcharges). 3. TERM OF AGREEMENT Throughout the term of thus Agreement, I/N Tek shall remain connected to and a customer of the City for all of its requirements for wastewater collection and treatment. The tern of this Agreement Page 2 of 6 shall be effective January 1, 2017 and remain in effect through December 31, 2026. There shall be no automatic renewal of this Agreement. If the parties hereto desire to renew this Agreement for an additional term of ten (10) years, I/N Tek must initiate such renewal and receive the approval from both the Board and Common Council. 4. MODIFICATION OF AGREEMENT This Agreement may only be modified by mutual written agreement of both parties with such modification requiring approval by Council. I/N Tek understands the requirements set forth under Section 17-29 of the City Code and shall present annually to Common Council to present relevant data on the following factors: a. review the terms of this Agreement, b. consider any reasonable modifications to the Agreement, c, review any other pertinent issues relative to wastewater treatment or to this Agreement. S. ADDITIONAL LEGAL TERMS a. Independent Contractor. Nothing herein contained shall be construed to place the parties in a relationship of partners, joint venturers or employet-employee, and neither party hereto shall have the right to obligate or bind the other party in any manner whatsoever. No employee, agent, servant or representative of the City shall be, or shall be deemed to be, an employee, agent, servant, or representative of I/N Tek. b. Responsibility for Acts of Agents. Each party shall at all times remain liable for the negligent, tortious or unlawful acts, omissions or misrepresentations of its employees, agents, servants, contractors and representatives in connection with the entry into and the performance of any of its obligations, duties or rights arising out of or related to thus Agreement. c. Nondisclosure of Trade Secrets or Statutorily Protected Information. Both parties acknowledge that each may, in the course of this Agreement, have access to trade secret(s) or confidential information of the other party that is protected from disclosure by a particular statute, rule or regulation. Both parties agree to protect such information to at least the same extent that they would safeguard similar information of their. own. However, no party shall be obligated to keep confidential any such information which was lawfully and independently obtained from a third party prior to the cormnencement date of this Agreement or without violating its terms. If information protected from disclosure under this paragraph is required to be disclosed pursuant to a valid court order or a valid subpoena issued under the authority of a court of competent jurisdiction, then the party of whom said request is made may disclose said information as required without violating this Agreement. d. Termination Upon Default. If there is a material default by either party in performing the terms and conditions of this Agreement, and such specified default shall continue for a period of thirty (30) days after Page 3 of 6 receipt of written notice thereof, then this Agreement shall terminate as of the thirty -fast day following receipt of such written notice. This Agreement may be immediately terminated by either party in the event that the other party hereto shall become insolvent or subject to voluntary or involuntary banluuptcy proceedings, receivership, conservatorship or similar proceedings under state or federal law. Notwithstanding, the City reserves the right to charge the full rate, rather than the discounted rate described in Paragraph 2 above, if I/N Tek falls to annually present relevant data related to this Agreement to Council. The full rate will be applied to IN Tek's monthly bill for each month until I/N Tek satisfies the requirements under Section 17-29 of the City Code. e. Governing Law. This Agreement is made under, and shall be governed by and construed in all respects in accordance with, the laces of the State of Indiana. Any claim or dispute arising out of or related to this Agreement in any manner, or to the performance or alleged non-performance hereof, shall be resolved exclusively via confidential, binding arbitration in St. Joseph County, Indiana. f. Headings for Convenience. The Words of this Agreement appearing as headings are for identification purposes only and are not a part of this Contract. g. Non -Assignment. This Agreement is personal to the parties. Neither party hereto shall have the right to assign or transfer any of its rights, duties, obligations or interests arising out of or relating to this Agreement to any thud party at any time without the prior written permission of the other parties to this Agreement. h. Authority to Enter Agreement. The undersigned parties each hereby represent and warrant that they have been duly authorized to enter into this Agreement on behalf of the respective organization for which they sign. i. Entire Agreement/Waiver. This Agreement constitutes the entire agreement and understanding between the parties hereto with respect to the subject matter hereof and cancels, terminates and supersedes any prior agreement or understanding (written or verbal) relating to the subject matter hereof. None of the provisions of this Agreement can be waived or modified except expressly in a writing signed by the party or patties to be charged. There are no representations, promises, agreements, warranties, covenants or undertaldngs other than those contained herein. If any term hereof shall be, or deemed to be, void or unenforceable by a court or tribunal of competent jurisdiction, then the remaining terms hereof shall remain in full force and effect. The waiver by either party hereto of a breach by the other party hereto of any provision herein shall not in any way constitute a waiver of any succeeding breach of the same or any other provision. Page 4 of 6 j. Compliance with Laws. In carrying out their respective rights and obligations hereunder, the City and I/N Tek each agree to comply with applicable local, state and federal statutes, laws, regulations and ordinances. k. Third Party Beneficiaries. Nothing contained in the agreement shall create any relationship, contractual or otherwise, with, or any rights in favor of, any third party. I. Non -Waiver. The Parties acknowledge this Agreement is based upon the current form of Sections 17-21; 17-29; and 17-81 of the City Code. In the event the Corm -non Council should modify the terms of the Sections of the City Code as such sections relate to this Agreement, I/N 'Tek shall have all rights granted under Indiana Law to contest the validity of such modifications and their applicability, if any, to this Agreement. m. Withdrawal of Petition. I/N Tek, as a condition precedent of the effectiveness of this Agreement, agrees to withdraw its Petition Opposing Increase in Sewage Rates and Charges For the City of South Bend, Indiana — Ordinance No. 10461-16 filed on January 27, 2017. I/N Tek shall provide the City with separate written confirmation of said withdrawal, however, such withdrawal shall be without prejudice to I/N Tek to challenge any ordinance imposing increases to rates or surcharges. n. Material Change. This Agreement is based upon on the Petition submitted by Robert Miller, Sr. ("Miller Petition), which challenges the outside city surcharge in Section 17-81 of the City Code being withdrawn discussed or ultimately rejected by final judgment no longer subject to appeal (the "Miller Petition"). I/N Tek shall not support the petitioner(s) in the Miller Petition in any manner. Pending the outcome of the Miller Petition, I/N Tek shall pay the outside city surcharge as set forth in Section 17-81 of the City Code. Should the Miller Petition be granted, the Parties agree it will be a Material Change to thus Agreement, and as a result, this Agreement shall be void ab initio from that date forward. IN WITNESS WHEREOF, I/N Tek and the City, through their duly authorized representatives, have caused this Agreement to be executed as of the day and year first written above. The parties have read and understand the foregoing terms of this Agreement and do, by their respective signatures hereby agree to its terms. [SIGNATURES CONTAINED ON FOLLOWING PAGE] Page 5 of 6 IIN TEK L.P. Date Signed: F4, /y,�?417 By: � Thomas W. Cayia Its: President IIN KOTE L.P. By: -- Thomas W. Cayia Its: President P:\WP51\DOC\Arcelor\IN Tek Special Rite Agreement RAN5.docs CITY OF SOUTH BEND, INDIANA Date Signed: By: Gary Gilot, President Suzanna M. Fritzberg, Member Ja s A. Mueller, Member ,�P7- Therese J. Doran, Member Eliza eth A. Maradik, Member ATTEST: Cnda Martin Clerk of the Board of Public Works Page 6 of 6 Date Name BOARD OF PUBLIC WORKS AGENDA ITEM REVIEW REQUEST FORM 02/21 /2017 Michael Schmidt Department Legal BPW Date 02/23/2017 Phone Extension Required Prior to Submittal to Board Legal Attorney Name Controller review is required for all Contracts $5,000.00 or more Controller ❑ and greater than one year in length per the City Purchasing Policy Purchasing ❑ Check the Appropriate Item Type — Required for All Submissions ❑ Agreement ❑ Contract ❑ Proposal ❑ Addendum ❑ Professional Services ❑ Bid Opening ❑ Bid Award ❑ Req. to Advertise ❑ Title Sheet ❑ Quote Opening ❑ Quote Award ❑ Chg Order No. ❑ C/O & PCA No. ❑ PCA ❑ Ease./Encroach. ❑ Traffic Control ❑ Resolution ❑ Other: ❑ Claim Company or Vendor Name New Vendor MBEANBE Contractor Project Name Project Number Funding Source Account No. Amount Terms of Contract Purpose/Description Amount of Previous Amount rNi ❑ Yes ❑ If Yes, Approved by Purchasing ❑ No ❑❑ WBE Completed E-Verify Form Attached ❑❑ Nos Special Rate Agreement No cost revision to page 1 of agreement previously approved by Board of Works on 2/14/17 For Chanoe Orders O Increase Decrease $ ArrAUVED $ ""rd uf ipuNic Works Current Percent of Change: New Amount Total Percent of Change: Time Extension: Dispersal After Approval Copy Original ❑ ❑ ❑ ❑ ❑ 7