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MEMORANDUM OF UNDERSTANDING FOR JOINT DEVELOPMENT, USE, MAINTENANCE AND ADMINISTRATION OF MOSCOW SCHOOL DISTRICT PROPERTY AT JOSEPH STREET This Memorandum of Understanding for Joint Development, Use, Maintenance and Administration of Moscow School District Property at Joseph Street (hereinafter "Memorandum of Understanding") is entered into this day of Apr i. ( , 2013 by and between Moscow School District No. 281, a body corporate and politic of the State ofldaho (hereinafter "District") and City of Moscow, a municipal corporation of the State of Idaho (hereinafter "City"). WITNESSETH: WHEREAS, District has outdoor playfield facilities needs and a desire to develop playfield opportunities for District students, and the City has recreational facilities needs and a desire to develop recreational opportunities for citizens and young people in and around the City of Moscow and for the public at large; and WHEREAS, District owns a parcel of real property comprised of approximately 22 acres located northerly of Joseph Street and easterly of Mountain View Road in Moscow, Idaho, more particularly described in Exhibit A attached hereto, and commonly referred to as the Moscow School District Property at Joseph Street ("Joseph Street Fields"); and WHEREAS, District and City have previously cooperated and jointly developed, used and maintained a portion of the Joseph Street Fields for mutual benefit and desire to further cooperate and jointly develop, use and maintain more Joseph Street ,Fields area for recreational purposes, including, but not limited to, for soccer, baseball, softball, basketball, general recreation and the like (the "Project"); and WHEREAS, the District and City intend by this Memorandum of Understanding to set forth certain non-binding understandings and commitments with respect to their mutual intentions to jointly develop, use, maintain and administer the Joseph Street Fields; and WHEREAS, it is the intent of District and City to enter into this Memorandum of Understanding as a joint and cooperative undertaking by which decision-making affecting the development, use, maintenance and administration of the Joseph Street Fields will result from discussion, collaboration and agreement between District and City; and, WHEREAS, both parties are vested with full authority under Idaho law to enter into and perform this Memorandum of Understanding, it not being the intent of either party nor the purpose of this Agreement to create a Joint Powers Agreement pursuant to Idaho Code§ 67- 2326 through§ 67-2333; and MEMORANDUM OF UNDERSTANDING FOR JOINT DEVELOPMENT, USE, MAINTENANCE AND ADMINISTRATION OF MOSCOW SCHOOL DISTRICT PROPERTY AT JOSEPH STREET- 1 2.DI3-J2 ---PAGE BREAK--- WHEREAS, each party to this Memorandum of Understanding wishes to retain its separate identity, authority and jurisdiction to the full extent of the law while cooperating with the other party pursuant to this Agreement, NOW THEREFORE, District and City mutually intend as follows: ARTICLE I PROPOSED PROJECT Section 1.1 Non-Binding Intentions. The matters set forth in Article 1 of this Memorandum of Understanding constitute an expression of the parties' present mutual intentions in connection with the proposed Project and do not constitute a binding agreement among the District and City with respect to the proposed Project described herein or otherwise. It is anticipated that the Joseph Street Fields will be developed with the essential elements contained in the 1999 "Master Plan for the Joseph Street Recreational Playfields" document that is in the possession of the parties. Any elements of the proposed Project described herein are subject to modification by either party at their discretion and the other party is under no obligation to agree to any such modification. Any binding agreement(s) between the parties in connection with the Project may be reached only as a result of the negotiation, execution and delivery of such written agreements as to which the parties may mutually agree (collectively the "Definitive Agreements") and (ii) the satisfaction, in each party's sole discretion, of those condition(s) precedent referenced in this Memorandum of Understanding or in any Definitive Agreement. Section 1.2 Project Description and General Terms. Subject to modification(s) to which the parties may agree in Definitive Agreements and as may be further modified through any public review and approval processes, it is the parties' intent that the Project scope, process, terms and conditions, without limitation, be described as follows: Section 1.2.1 Project Location and Improvements. The Project is to be located and developed within the area of the Joseph Street Fields, which real property is now and will continue to be solely owned by the District. The parcel is presently improved with a softball/baseball field, the outfield portion of which is also used as a playfield for other sports, and parking area. The Project is presently intended to improve the unimproved portion of the Joseph Street Fields with a baseball field, soccer field and other field and play areas (collectively the "Improvements"), provided, however, that the development plan will identify an area of the Joseph Street Fields as a future site of a District facility, and the District will retain all rights to construct a District facility at any time within that area, (ii) utilize parking within the Joseph Street Fields area to serve any such District facility and (iii) post signage identifying that area as a future site of a District facility. Improvements are to be developed in phases as agreed upon between District and City. Section 1.2.2 Development Cost Sharing. The parties intend to construct all Improvements at a total cost for all planning, design, engineering and construction services and materials that does not exceed $3,000,000. Assuming Project costs do not exceed $3,000,000, the District intends to contribute one half (1/2) of the total Project costs but not to exceed $1,500,000 and the City intends to contribute one-half (l/2) of the total Project costs but not to exceed $1,500,000. MEMORANDUM OF UNDERSTANDING FOR JOINT DEVELOPMENT, USE, MAINTENANCE AND ADMINISTRATION OF MOSCOW SCHOOL DISTRICT PROPERTY AT JOSEPH STREET- 2 ---PAGE BREAK--- Section 1.2.3 Planning. In the event a facilities bond is passed by electors eligible to vote in a District bond election to be held in May, 2013 to provide funding for the Project, the District and City will collaborate and agree on a final site plan for the Project with six months of the passage of said bond election and (ii) on a joint model of participation in connection with the planning, design, scheduling, construction, construction management and inspection of Improvements. Section 1.2.4 Maintenance. City and District intend to agree annually on a maintenance budget for the Joseph Street Fields and to share equally in the cost of maintaining the Joseph Street Fields, with the City to perforn1 actual maintenance. Extraordinary, major and/or unexpected maintenance activities are to be agreed upon in advance by both parties. Any revenues generated from use of the Joseph Street Fields are to be applied to maintenance costs as will be more particularly described in the Definitive Agreement(s). Section 1.2.5 Joseph Street Fields Usage. District and City will share use of the Joseph Street Fields on a relatively equal basis but giving priority to District's use needs. District and City will collaborate and reasonably cooperate in developing and implementing use and scheduling policies to be mutually agreed upon by both parties. City will provide programming services and coordinate scheduling for Joseph Street Fields activities. Each party when using Joseph Street Fields shall provide, at its own expense, sufficient supervision to prevent careless or malicious injury to persons and/or property and (ii) shall be responsible for clean-up at the conclusion of each activity. Section 1.2.6 Term. District and City intend to agree to a 30 year commitment for shared use and maintenance of the Joseph Street Fields for recreational purposes. Such purposes include, but are not limited to, soccer, softball, baseball, basketball and other outdoor ball field and recreational uses. The parties agree that the City reserves the right to withdraw from and terminate the Definitive Agreement(s) upon one year, prior written notice to the District. Section 1.2.7 Indemnification by District. The District shall indemnify, defend, and hold the City harmless from and against any and all claims, losses, damages, injuries, liabilities and costs, including attorney fees, court costs and expenses and liabilities incurred in or from any such claim, arising from any breach or default in the performance of any obligation to be performed under the terms of any Definitive Agreement by the District, or arising from any act, negligence or omission by the District or any of its agents, employees and volunteers. The District's liability under this paragraph shall be limited by the terms of the Idaho Tort Claims Act and the limits of any insurance provided under the Act arid Idaho Code § 67-5776. Section 1.2.8 Indemnification by City. The City shall indemnify, defend and hold the District harmless from and against any and all claims, losses, damages, injuries, liabilities and costs, including attorney fees, court costs and expenses and liabilities incurred in or from any such claim, arising from any breach or default in the performance of any obligation to be performed under the terms of any Definitive Agreement by the City, or arising from any act, negligence, or omission by the City or any of its agents, employees and volunteers. The City's liability under this paragraph shall be limited by the terms of the Idaho Tort Claims Act and the limits of any insurance provided under the Act and Idaho Code§ 67-5776. MEMORANDUM OF UNDERSTANDING FOR JOINT DEVELOPMENT, USE, MAINTENANCE AND ADMINISTRATION OF MOSCOW SCHOOL DISTRICT PROPERTY AT JOSEPH STREET- 3 ---PAGE BREAK--- Section 1.2.9 Insurance by District. The District shall maintain comprehensive public liability and property damage insurance with limits reasonably satisfactory to the City as will protect the District from .claims for damages because of bodily injury, including death, or damages because of injuri¶s or destruction or loss of use of property, which may arise from its operations under an applicable Definitive Agreement whether such operations be by it or its agents or anyone directly or indirectly employed by the District. In addition, the District is responsible for the following: the District shall notify the City in writing as soon as practicable after notice of an injury or a claim is received; the District shall cooperate completely with the City and/or the City's insurers in the defense of such injury or claim; and the District shall take no steps (such as admission of liability) which will prejudice the defense or otherwise prevent the City from protecting the City's interests. All insurance required under this paragraph shall be maintained in full force and effect in a company or entity or companies or entities reasonably satisfactory to City and shall be maintained at the District's expense until an applicable Definitive Agreement terminates. Certificates of such insurance shall be provided to the City contemporaneously with the execution and delivery of an applicable Definitive Agreement by the District and at any other time upon reasonable notice by the City to the District. Failure to maintain the insurance required by an applicable Definitive Agreement shall be grounds for its immediate termination notwithstanding any other provisions governing termination of an applicable Definitive Agreement. Section 1.2.10 Insurance by Citv. The City shall maintain comprehensive public liability and property damage insurance with limits reasonably satisfactory to the District as will protect the City from claims for damages because of bodily injury, including death, or damages because of injuries or destruction of loss of use of property, with may arise from its operations under an applicable Definitive Agreement whether such operations be by it or its agents or anyone directly or indirectly employed by the City. In addition, the City is responsible for the following: the City shall notify the District in writing as soon as practicable after notice of an injury or a claim is received; the City shall cooperate completely with the District and/or the District's insurers in the defense of such injury or claim; and the City shall take no steps (such as admission of liability) which will prejudice the defense or otherwise prevent the District from protecting the District's interests. All insurance required under this paragraph shall be maintained in full force and effect in a company or entity or companies or entities reasonably satisfactory to District and shall be maintained at the City's expense until an applicable Definitive Agreement terminates. Certificates of such insurance shall be provided to the District contemporaneously with the execution and delivery of an applicable Definitive Agreement by the City and at any other time upon reasonable notice by the District to the City. Failure to maintain the insurance required by an applicable Definitive Agreement shall be grounds for its immediate termination notwithstanding any other provisions governing termination of an applicable Definitive Agreement. Section 1.2.11 Rights Not Assignable. District and City shall not assign any rights under any Definitive Agreement to any other person or entity, governmental or otherwise, without the prior written approval of the other party. Nothing in this paragraph shall preclude utilizing volunteer or donated resources to assist in improving the Joseph Street Fields, as mutually agreed by the parties. MEMORANDUM OF UNDERSTANDING FOR JOINT DEVELOPMENT, USE, MAINTENANCE AND ADMINISTRATION OF MOSCOW SCHOOL DISTRICT PROPERTY AT JOSEPH STREET- 4 ---PAGE BREAK--- Section 1.2.12 Interpretation. As a further condition of any Definitive Agreement, District and City acknowledge that any Definitive Agreement shall be deemed and construed to have been prepared mutually by each party and it shall be expressly agreed that any uncertainty or ambiguity existing therein shall not be construed against any party. In the event any pruiy shall take an action, whether judicial or otherwise, to enforce or to interpret any of the terms of any Definitive Agreement, the prevailing party shall be entitled to recover from the other party all expenses which it may reasonably incur in taking such action, including attorney fees and costs, whether incurred in a court of law or otherwise. Section 1.2.13 No Joint Venture. Any Definitive Agreement is not intended to and does not create a new independent legal administrative entity. The property, monies, and/or personnel. provided by each party to this Agreement shall remain the property, monies, and/or personnel of the party providing such property, monies and/or personnel. Section 1.2.14 No Restriction of Authority. Nothing in any Definitive Agreement shall restrict, minimize or alter the constitutional and/or statutory authority pursuant to which each party provides services. Section 1.2.15 No Obligation Without Authorization. Nothing in any Definitive Agreement will obligate either party to provide property, monies, and/or personnel unless such provision is specifically authorized by the respective party. Section 1.2.16 Jurisdiction and Venue. It is agreed that any Definitive Agreement shall be construed under and governed by the laws of the State ofldaho. In event of litigation concerning it, it is agreed that property venue shall be the District Court of the Second Judicial District of the State ofldaho, in and for the County of Latah. Section 1.2.17 Binding Authority. Each Party represents and wru.Tants to the other that any Definitive Agreement has been validly executed and delivered, (ii) has been duly authorized and (iii) constitutes a valid binding agreement of such party enforceable in accordance with its terms. Section 1.2.18 Appropriation of Funds. Any Defmitive Agreement is contingent upon each governmental entity receiving the necessary funding to cover the obligations of the govenunental entity herein. In the event that such funding is not received or appropriated, then and in that event, the respective governmental entity's obligations under any Definitive Agreement shall cease and each party shall be released from further performance under any Definitive Agreement without any liability to the other party. ARTICLE II PLANNING, FINANCING AND NEGOTIATIONS Section 2.1 Planning. Immediately upon execution of this Memorandum of Understanding, the parties, in good faith, intend to engage in mutual planning efforts related to the Project, including discussing Project planning with each other, developing an overall site plan for the Project, determining Project cost estimates, evaluating and sharing anticipated usage, usage fees and MEMORANDUM OF UNDERSTANDING FOR JOINT DEVELOPMENT, USE, MAINTENANCE AND ADMINISTRATION OF MOSCOW SCHOOL DISTRICT PROPERTY AT JOSEPH STREET- 5 ---PAGE BREAK--- scheduling needs for the Joseph Street Fields, seeking planning input from constituents and developing a joint model of participating in connection with the planning, design, scheduling, construction, construction management and inspection of Improvements. Section 2.2 Financing. Immediately upon execution of this Memorandum of Understanding, the parties, in good faith, intend to secure adequate financing in order that each party will be able to contribute up to $1 ,500,000 total Project costs. The District intends to do so by presenting a facilities bond to electors eligible to vote in a District bond election to be held in May, 2013. Section 2.3 Negotiations. Immediately upon execution of this Memorandum of Understanding, the parties will begin to negotiate the terms and begin preparation of the Definitive Agreement(s) that will govern the parties' rights, duties and responsibilities in connection with the development, use, maintenance and administration of the Project and Improvements. The parties intend for the Defmitive Agreement(s) to incorporate the expression of the parties' mutual intentions in connection with the proposed Project as set forth in Article I above and also such conditions precedent as may be applicable from those set forth in Article III below. ARTICLE III CONDITIONS PRECEDENT Section 3.1 Applicable Conditions Precedent. This Memorandum of Understanding and the consummation of the transaction contemplated by this Memorandum ofUnderstanding are each subject to the satisfaction or waiver, as the case may be, of those conditions precedent applicable to the Project and Improvements, which include, without limitation: Section 3.1.1 Satisfactory Results of Due Diligence. The satisfactory completion of due diligence investigation showing that the Project and Improvements, from the District's perspective and the City's perspective, respectively, are viable and affordable and can be financed. Section 3.1.2 Compliance. The satisfactory determination that the Project and Improvements will comply with all applicable laws, statutes, ordinances, rules, codes and/or regulations. Section 3.1.3 Consents and Approvals. The approval and consent as to any Definitive Agreement(s) by the District Board of Trustees and City Council, respectively, and the receipt of consents and/or approvals from all governmental entities, utilities, lenders and/or other parties which are necessary or appropriate in connection with the Project and Improvements. Section 3.1.4 Absence of Material Litigation or Adverse Charges. There must be no pending or threatened material claims or litigation involving or related to the Project and Improvements and no material adverse charge in the desirability or viability or financing of the Project and Improvements. Section 3.1.5 Legal Opinions. Satisfactory opinion(s) as to legal matters pertinent to the Project and Improvements must be obtained by District and City. MEMORANDUM OF UNDERSTANDING FOR JOINT DEVELOPMENT, USE, MAINTENANCE AND ADMINISTRATION OF MOSCOW SCHOOL DISTRICT PROPERTY AT JOSEPH STREET-6 ---PAGE BREAK--- Section 3.1.6 Financing. District and City must possess or have obtained and/or secured financing necessary for completion of the Project and Improvements. Section 3.2 Failure to Satisfy. In the event any condition precedent set forth in this Article III is not satisfied as applied to a party, that party may elect to terminate this Memorandum of Understanding by written notice to the other party specifying the condition(s) precedent which have not been satisfied, and, thereafter, all rights and duties under this Memorandum of Understanding shall immediately be deemed null and void and of no further force and effect. ARTICLE IV AGREEMENTS Section 4.1 No Assignment. Neither party shall directly or indirectly assign or transfer, whether by operation of law or otherwise, all or any rights, interests and/or obligations of any kind arising under or in connection with this Memorandum of Understanding. Section 4.2 No Liability to Other Party. Neither pat1y shall have any liability to the other for any costs or expenses incurred in this process of negotiating and preparing the Definitive Agreement(s), and, except to the extent otherwise set forth in a written agreement entered into between the parties, each party shall be solely responsible for its own expenses, consulting fees, legal fees and other professional expenses related to the negotiations and preparation of this Memorandum of Understanding and any actions it has taken in furtherance of the transaction contemplated by this Memorandum of Understanding. Section 4.3 Termination Upon Execution of Definitive Agreements. This Memorandum of Understanding shall terminate in its entirety without further notice on the date on which Definitive Agreement(s) are executed by the District and City essential to the consummation of the transaction contemplated by this Memorandum of Understanding. Section 4.4 Representation and Warranties. The parties hereby represent and warrant to each other that this Memorandum of Understanding has been validly executed and delivered and has been duly authorized by the party executing and delivering the same. Section 4.5 Notice. All communication or notification to be given under this Memorandum of Understanding shall be given to the following: Notice to District Dale Kleinert, Superintendent 650 N. Cleveland Moscow, ID 83843 with copy to: Landeck & Forseth Attorneys at Law 693 Styner A venue, Suite 1 0 P.O. Box693 Moscow, ID 83843 Notice to City Gary Riedner P.O. Box 9203 Moscow, ID 83843-1703 with copy Moscow City Attorney P.O. Box 9203 Moscow, ID 83843-1703 MEMORANDUM OF UNO ERST ANDING FOR JOINT DEVELOPMENT, USE, MAINTENANCE AND ADMINISTRATION OF MOSCOW SCHOOL DISTRICT PROPERTY AT JOSEPH STREET - 7 ---PAGE BREAK--- Section 4.6 Complete Agreement. This Memorandum of Understanding constitutes the entire expression of intent and/or agreement of the parties in relation to the transaction contemplated by this Memorandum of Understanding and supersedes all prior agreements or understandings, written or oral, with respect thereto. Section 4.7 Non-Binding Obligation. Except as to the provisions of this Article IV, the parties understand and agree that this Memorandum of Understanding sets forth only the parties' expression of their current intentions which may, but need not, be set forth in binding, Definitive Agreement(s) executed at a later date and (ii) this Memorandum of Understanding does not create and is not intended to create a binding and enforceable contract between the parties and may not be relied upon by either party as the basis for a contract by estoppel or otherwise, but rather evidences a non-binding agreement to collaborate and cooperate without obligation, to negotiate mutually agreeable Definitive Agreement(s). This Memorandum of Understanding does create a duty on each party to negotiate in good faith with the intention, but not the obligation, of creating a binding contract. Negotiation of the Definitive Agreement(s) shall not be considered evidence of the formation of a binding contract by estoppel or otherwise, and no agreement shall be deemed to exist with respect to the transaction contemplated by this Memorandum of Understanding, other than those matters set forth in this Article IV hereof, unless and until the parties execute and deliver Definitive Agreement(s) consummating the transaction contemplated by this Memorandum of Understanding, and such Definitive Agreement(s) become effective in accordance with their terms. No party shall be entitled to bring any claim or action against any other party as a result of a failure to agree on or enter into any Definitive Agreement(s). IN WITNESS WHEREOF, District and City, by and through their respective officials designated below, have caused this Memorandum of Understanding to be executed on the date and year first above written. CITY OF MOSCOW _ _ Dale Kleinert, Superintendent By 9 Dawn Fazio, Chair, rd of Trustees ATTEST: MEMORANDUM OF UNDERSTANDING FOR JOINT DEVELOPMENT, USE, MAINTENANCE AND ADMINISTRATION OF MOSCOW SCHOOL DISTRICT PROPERTY AT JOSEPH STREET - 8