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Full Agenda Packet CITY OF JANESVILLE CITY COUNCIL MEETING AGENDA MONDAY, February 13, 2012 7:00 P.M. 1. Call to Order and Pledge of Allegiance. 2. Roll Call. 3. Regular City Council meeting minutes of January 23, 2012. “C” 4. Licenses; and Recommendations of the Alcohol License Advisory Committee. (Refer to separate agenda.) “C” OLD BUSINESS 1.Requests and comments from the public regarding items on the Agenda not requiring a public hearing. 2.Second reading, public hearing and action on a proposed ordinance annexing property located at 4021 U.S. Highway 51 South. (File Ord. No. 2012-506) 3.Second reading, public hearing and action on a proposed ordinance zoning property located at 4021 U.S. Highway 51 South to M1 upon annexation. (File Ord. No. 2012-507) 4.Second reading, public hearing and action on a proposed ordinance amending City of Janesville alcohol regulations to allow Class A liquor and beer sales starting at 8:00 o’clock a.m. (Revised File Ord. No. 2012-508) 5.Action on a proposed resolution amending the Project Plan and boundaries for Tax Increment Finance District No. 35. (File Res. No. 2012-875) NEW BUSINESS 1.Action on a proposed resolution authorizing the City Manager to enter into a TIF development agreement with SHINE Medical Technologies. (File Res. No. 2012-882) ----------------------- “C” – This designation indicates an item that the City Council will take up under a Consent Agenda. City Council Agenda – February 13, 2012 Page 2 NEW BUSINESS (CONTINUED) 2.Action on a proposed resolution extending health care and related benefits to domestic partners of qualifying City and Library employees. (File Res. No. 2012-863) 3.Presentation on elections. 4.Award of Contracts 2012-1 (ice arena addition & renovation), 2012-2 (landfill closure – phase 1), and 2012-3 (new sidewalk) for Public Works Bid Schedule A – 2012. 5.Action on a proposed preliminary resolution for assessable sewer and water laterals and schedule a public hearing for the final resolution. (File Res. No. 2012-881) 6.Action on a proposed resolution authorizing the City Administration to expend funds to replace turf Maintenance equipment at Riverside and Blackhawk Golf Courses. (File Res. No. 2012-885) 7.Review and approval of an economic development grant to Decisions LLC, DBA as Lyfe Lounge and Banquets (Lyfe) located at 18-24 River Street. 8.Action on a proposed resolution supporting an amendment to the US Constitution regarding corporate personhood. (File Res. No. 2012-880) 9.Action on a proposed Council policy establishing term limits for City Councilmembers serving on Boards, Commissions and Committees (Council Policy No. 90). 10.Action on dissolution of the Ice Skating Center Advisory Committee and the Cable Advisory Committee. 11.Introduce and schedule a public hearing on a proposed a public hearing on a proposed ordinance amending Janesville’s parking penalties. (File Ord. No. 2012-509) 12.Requests and comments from the public on matters which can be affected by Council action. 13.Matters not on the Agenda. 14.Motion to adjourn. The use of audible cell phone ringers and active use and response to cellular phone technology by the governing body, staff and members of the public is discouraged in the Council Chambers while the Council is in session. PROCEEDINGS OF THE CITY COUNCIL CITY OF JANESVILLE, WISCONSIN REGULAR MEETING JANUARY 23, 2012 VOL. 62 NO. 30 Regular meeting of the City Council of the City of Janesville held in the Municipal Building on January 23, 2012. The meeting was called to order by Council Vice President Rashkin at 7:00 PM. Boy Scout Troop #516 led the Council in the Pledge of Allegiance. Present: Councilmembers Dongarra-Adams, Liebert, McDonald, Rashkin, and Voskuil. Absent: Council President Steeber. CONSENT AGENDA Closed session minutes of April 12, 2010. Closed session minutes of February 28, 2011. Closed session minutes of March 14, 2011. Closed session minutes of June 13, 2011. Closed session minutes of July 11, 2011. Closed session minutes of August 8, 2011. Closed session minutes of November 14, 2011. Regular meeting minutes of January 9, 2012. Licenses; and Recommendations of the Alcohol License Advisory Committee. (Refer to separate agenda.) Action on a financial gain request by Habitat for Humanity for a run/walk to be held on May 19, 2012. Authorization for the Administration to approve a liability claim from Randy DeGarmo in the amount of $12,000.00. Council Vice-President Rashkin stated that all items on the consent agenda would be approved if there were no objections. There were none. OLD BUSINESS 1. Requests and comments from the public regarding items on the Agenda not requiring a public hearing. No one spoke. 2. A proposed ordinance amending the zoning conditions of approval for property located on the southwest corner of Jerome Ave. and Delavan Dr. received its second reading and public hearing. John Grimmer, owner of ANGI Energy Systems spoke in favor of the ordinance. Robert Sage, 1051 Jerome Ave., Ray Hume, 1039 Jerome Ave., Billy McCoy, 1326 Putnam Ave., and Andreah Briarmoon, 339 S. Locust St., spoke against the ordinance. The public hearing was closed. Councilmember McDonald moved to adopt said ordinance with the hours of operation for truck traffic from 7 a.m. to 7 p.m., seconded by Councilmember Liebert and passed unanimously. (Revised File Ord. No. 2011-504) NEW BUSINESS 1. A proposed ordinance amending City of Janesville alcohol regulations to allow Class A liquor and beer sales starting at 6:00 o’clock a.m. was introduced and scheduled for a public hearing on February 13, 2012. Councilmember Rashkin moved to change the start time of alcohol sales from 6:00 a.m. to 8:00 a.m., seconded by Councilmember Liebert and passed by the following vote: Aye: Dongarra-Adams, Liebert and Rashkin. Nay: McDonald and Voskuil. (File Ord. No. 2012-508) 2. Requests and comments from the public on matters which can be affected by Council action. No one spoke. 3. Matters not on the Agenda. Councilmember Rashkin stated the Sustainability Committee requested: 1. the Council to initiate the Recycle Away from Home plan for businesses and 2. City staff scan documents with OCR coding. He also encouraged everyone to attend JPAC awards on February 11, 2012. 4. Councilmember Voskuil moved to convene into closed session, pursuant to Wisconsin Statute Section 19.85(1)(e), for the purpose of deliberating and setting the negotiation and bargaining strategies, terms, and conditions for a potential TIF manufacturing development agreement concerning Pres-On Corp., Addison, IL, 71 potential new jobs, since competitive and/or bargaining reasons require a closed session. The motion was seconded by Councilmember McDonald and passed unanimously. There being no further business, Council convened into closed session at 7:44 p.m. These minutes are not official until approved by the City Council. David T. Godek Deputy Clerk-Treasurer JANESVILLE CITY COUNCIL LICENSE AGENDA 2/13/2012 RECOMMENDED A. ELECTRICIANS–ORIGINAL John C. Madigan W7435 Hickory Ln., Pardeeville, WI Raymond J. Mielke 2222 Minnesota St., Oshkosh, WI B. SECONDHAND ARTICLE DEALER–ORIGINAL Mike’s Best Deals, LLC 2919 N Lexington Dr. C. ORIGINAL CLASS B BEER ONLY AND CLASS C WINE ONLY LICENSES Romanos Pizza Inc. d/b/a Romanos Pizzeria & Restaurant Francesco Romano 1009 North Washington St. D. ORIGINAL CLASS B INTOXICATING LIQUOR AND FERMENTED MALT BEVERAGE LICENSE Column 411, LLC d/b/a Down the Street Andrew R. Sigwell 965 South Jackson St. Community Development Department Memorandum February 13, 2012 TO: Janesville City Council FROM: Duane Cherek, Planning Services Manager SUBJECT: Second reading, public hearing and action on a proposed ordinance annexing property located at 4021 U.S. Highway 51 South (File Ordinance No. 2012-506). Second reading, public hearing and action on a proposed ordinance zoning property located at 4021 U.S. Highway 51 South to M1 upon annexation (File Ordinance No. 2012-507). SUMMARY The City has received a petition to annex approximately 81 acres of land from Art Donaldson, property owner, at 4021 U.S. Highway 51 South. The annexation area is located east of US Highway 51 and the Southern Wisconsin Regional Airport, south of the State Highway 11 Bypass. The property is currently undeveloped and in farmland use. The City has an accepted offer to purchase the subject property from Mr. Donaldson. The adjoining land to the north, already within the City limits, is included within TIF District 35. It is the City’s intention to amend the TIF District 35 boundary to include the annexation area and allow for industrial expansion and development opportunities on the site. In conjunction with the annexation ordinance, the Community Development Department has prepared an ordinance to zone the property M1, Light Industrial District. Approval of the annexation requires a 2/3 vote of the Council, therefore four favorable votes are necessary. DEPARTMENT RECOMMENDATION The Plan Commission and the Community Development Department recommend that, following a public hearing, the City Council support a motion to adopt Ordinance Nos. 2012-506 and 2012-507 annexing and zoning to M1 property located at 4021 U.S. Highway 51 South. CITY MANAGER RECOMMENDATION The City Manager recommends approval. SUGGESTED MOTION A motion to adopt Ordinance Nos. 2012-506 and 2012-507 annexing and zoning to M1 property located at 4021 U.S. Highway 51 South. ANALYSIS A. The annexation area is located on the City’s far south side along U.S. Highway 51east of the Southern Wisconsin Regional Airport. The area proposed for annexation contains approximately 81 acres of undeveloped land used for agricultural crop production. The property is currently zoned A1, Agricultural District and B2, Large Scale Commercial District in the Town of Rock. The subject property is contiguous with the City Limits along the north line of the annexation area where it adjoins a large industrial site included in TIF 35. B. The area proposed for M1 zoning is situated immediately south of Janesville’s “shovel ready” certified industrial park located at the southwest corner of the intersection of Beloit Avenue and STH 11. This area has been targeted for industrial growth due to its flat topography and is ideally located in proximity to major regional transportation corridors and facilities including USH 51, STH 11, CTH G (Beloit Avenue), I-39/90 and the Southern Wisconsin Regional Airport. The subject property is adjacent to the City limits and existing M1, Light Industrial, zoned property. The annexation area is also located within the City’s Urban Service Limits which delineate those areas around the City where sanitary sewer is expected to accommodate urban development and sanitary facilities can be provided in a cost- effective manner. Sewer and water mains already exist along the property’s U.S. Highway 51 frontage and can be easily extended to accommodate projected development within the annexation area. These characteristics make it very appropriate for industrial development and targeted industries. C. Since 2009, the City has had an option to purchase the subject site from Art Donaldson, property owner and annexation petitioner. In late 2011, the City Council approved Resolution No. 2011-865 which authorized the acquisition and purchase of the property to create an industrial development site and allow for other development-related improvements. Earlier in 2011, the City Council approved the creation of TIF No. 35, located directly north of the annexation area. The City intends to amend the Project Plan and boundary for TIF No. 35 to include all property within the annexation area. As a result, annexation of the subject area and the proposed expansion of TIF No. 35 will serve to advance the City’s economic development efforts in this location. D. The subject property has been identified as a site that could potentially accommodate a new manufacturing facility in Janesville. A Middleton-based company, SHINE Medical Technologies, Inc., desires to build a new manufacturing plant to produce medical isotopes used in diagnostic imaging procedures (i.e. cancer and heart disease scans). The area proposed for annexation and inclusion in the TIF District is well-positioned to accommodate an advanced manufacturing facility of this type or a wide variety of other industrial land use activities based on the property’s geographical attributes, surrounding transportation facilities, utility services and other forms of public infrastructure. E. The entire 81-acre site is proposed to be zoned M1, Light Industrial District, upon annexation. This district is consistent with the recommendations of the Comprehensive Plan, Industrial Development Plan and the proposed amendment to the TIF No. 35 Project Plan. The Comprehensive Plan specifically identifies this area as appropriate for Light Industrial as shown on the Future Land Use Map and also recommends future industrial expansion to the south of the City. The site is located within the City’s Urban Service Limits where municipal utility services may be extended to the property. Further, as an economic development strategy, the Plan encourages that the City capitalize on opportunities to promote research and development industries within Janesville and enhance the City’s role as a regional economic center. F. The annexation area is located within the Airport Overlay Zoning District for the Southern Wisconsin Regional Airport. This designation restricts, or limits the overall height of structural improvements within the overlay zone district and includes design-related standards to minimize potential hazardous impacts to the airport that may result from proposed land use in the vicinity of the airport. Since industrial uses as are generally more compatible land use activities as compared to other development scenarios such as residential near the airport, application of the M1 zoning designation upon annexation is appropriate. PLAN COMMISSION ACTION – 6 FEBRUARY 2012 Duane Cherek, Manager of Planning Services, presented the written staff report. There was no discussion. The public hearing was opened and no one appeared to speak regarding this item. The public hearing was closed. There was a motion by Commissioner Consigny with a second by Commissioner Siker to forward the proposed zoning upon annexation of property located at 4021 U.S. Highway 51 South to M1 to the City Council with a favorable recommendation. The motion carried on a 6-0-0 vote. FISCAL IMPACT The City has exercised an option to purchase approximately 84 acres of land south of State Highway 11 in order to promote future industrial growth in this area. Zoning of the property to M1, Light Industrial District, is proposed upon annexation. The property is also intended to be included within TIF No. 35 which is an industrial TIF District located adjoining and north of the annexation area. The purchase will allow the City to expand upon the planned industrial park in this area (Certified “Shovel-Ready” Industrial Site) and provide financial incentives to encourage continued industrial growth – a primary goal of the City’s Economic Development Strategy. Expansion of new industry in this area as part of the Amended TIF No. 35 will promote orderly industrial development and add to the City’s tax and employment base. The spin-off effect of new employment opportunities would generate increased local disposable incomes within the community, thus providing a long-term positive impact on the City. Sewer and water facilities adjoin the annexation area and can easily be extended. City staff believes that this rezoning and annexation will facilitate industrial development within this transportation corridor and capitalize on proximity to the airport, highway accessibility and improvements and utility extensions. In instances where annexation of land is proposed for inclusion within a TIF District, the economic feasibility of the Project Plan details the perspective costs for land acquisition and “up front” public improvements needed to stimulate and support new development. Projected revenues to be generated by new development and corresponding real estate values are also included in the analysis. The City will not proceed with any public improvements until a developer or business commits to construct a new facility with a value sufficient to generate property tax increments needed to cover the improvement costs, according to the City’s TIF Policy. Based upon those assumptions, a positive fiscal impact should be anticipated. State law regarding annexation requires that the City pay the Town for the loss in property tax which occurs when annexation takes place. The City is required to pay the Town annually for five years an amount equivalent to property taxes that would have otherwise been collected by the Town. In this case, the cost to reimburse the Town of Rock for the loss of property tax is included as a TIF expenditure. Based on the use- value assessment of agricultural land, the value per acre established by the State Department of Revenue is very low. Staff estimates the annual reimbursement cost to the Town to be approximately $60 per year. In addition, a penalty will be imposed by the State at the time land within the annexation area is removed from agricultural production and converted to another use. Under current assessment law, the total estimated penalty cost of removing the land from a cropland use would be approximately $20,000. This cost would also be applied as a TIF expenditure for the annexation area. cc: Eric Levitt Jay Winzenz ORDINANCE NO. 2012-506 An ordinance annexing territory in Section 24 in T.2N., R.12E. of the 4th P.M., Town of Rock, Rock County, Wisconsin. WHEREAS , a petition signed by the owner of the land within such territory proposed to be annexed has been filed with the City Clerk; and WHEREAS , there are no electors residing in the territory; and WHEREAS , the necessary notices have been duly prepared, provided and served as required by law to all persons affected; and WHEREAS , this ordinance does not contain temporary zoning; and WHEREAS , the Department of Administration has not found the proposed annexation to be against the public interest; and WHEREAS , the Common Council has determined that this annexation is in the public interest. NOW THEREFORE THE COMMON COUNCIL OF THE CITY OF JANESVILLE DO ORDAIN AS FOLLOWS: SECTION I. The territory described as follows is hereby attached to the City of Janesville. TH PART OF THE NW 1/4 OF SECTION 24, T.2N., R.12E. OF THE 4 P.M., TOWN OF ROCK, ROCK COUNTY, WISCONSIN. DESCRIBED AS FOLLOWS: Commencing at an aluminum monument at the North 1/4 Corner of said Section; thence S.0°43’12”E. along the North-South Centerline of said Section, 400.30 feet to an iron pin monument on the South Line of a Parcel described in Document No. 1690897, also being at the place of beginning for the land to be herein described; thence S.0°43’12”E. continuing along said North-South Centerline, 1692.15 feet to an iron pin on the Easterly extension of the North Line of a tract described in Document No. 1401544; thence N.89°04’46”W. along said North Line and its extension, 2477.53 feet; thence N.6°58’46”E. 2.22 feet; thence N.15°55’12”E. 542.01 feet; thence N.21°33’01”E. 230.09 feet; thence N.18°14’52”E. 233.64 feet; thence N.47°44’21”E. 625.53 feet; thence N.44°27’40”E. 432.15 feet to said South Line of said Parcel (Document No. 1690897); thence S.88°30’01”E. along said South Line, 1384.17 feet to the place of beginning. SECTION II. After this annexation becomes effective, the above described property shall be exempt from and not subject to further taxation and assessments in the Town of Rock and thence forth shall be subject to taxation and assessment as part of the City of Janesville for any and all purpose provided by law. ORDINANCE NO. 2012-506 PAGE 2 SECTION III. All the territory attached by this ordinance is hereby made part of Ward 30 of the City of Janesville. SECTION IV. There are no residents in the area proposed for annexation. SECTION V. The annexation is within the Janesville School District. SECTION VI. This ordinance shall take effect immediately upon adoption by the Common Council, the public health, welfare, peace, tranquility, good order, public benefit, and police power so requiring. ADOPTED: Motion by: Second by: APPROVED: Councilmember Aye Nay Pass Absent Dongarra-Adams Eric J. Levitt, City Manager Liebert McDonald ATTEST: Rashkin Steeber Voskuil Jean Ann Wulf, City Clerk-Treasurer APPROVED AS TO FORM: Wald Klimczyk, City Attorney Proposed by: Applicant Prepared by: Community Development Department ORDINANCE NO. 2012-507 An ordinance changing and establishing the zoning classification of property located south of Avalon Road and east of Highway 51 to M1. THE COMMON COUNCIL OF THE CITY OF JANESVILLE DO ORDAIN AS FOLLOWS: SECTION I. The zoning classification of the following described property is established as M1, Light Industrial District: TH PART OF THE NW 1/4 OF SECTION 24, T.2N., R.12E. OF THE 4 P.M., TOWN OF ROCK, ROCK COUNTY, WISCONSIN. DESCRIBED AS FOLLOWS: Commencing at an aluminum monument at the North 1/4 Corner of said Section; thence S.0°43’12”E. along the North-South Centerline of said Section, 400.30 feet to an iron pin monument on the South Line of a Parcel described in Document No. 1690897, also being at the place of beginning for the land to be herein described; thence S.0°43’12”E. continuing along said North-South Centerline, 1692.15 feet to an iron pin on the Easterly extension of the North Line of a tract described in Document No. 1401544; thence N.89°04’46”W. along said North Line and its extension, 2477.53 feet; thence N.6°58’46”E. 2.22 feet; thence N.15°55’12”E. 542.01 feet; thence N.21°33’01”E. 230.09 feet; thence N.18°14’52”E. 233.64 feet; thence N.47°44’21”E. 625.53 feet; thence N.44°27’40”E. 432.15 feet to said South Line of said Parcel (Document No. 1690897); thence S.88°30’01”E. along said South Line, 1384.17 feet to the place of beginning. SECTION II. This ordinance shall take effect immediately upon adoption by the Common Council, the public health, welfare, peace, tranquility, good order, public benefit, and police power so requiring. ADOPTED: Motion by: Second by: APPROVED: Councilmember Aye Nay Pass Absent Eric J. Levitt, City Manager Dongarra-Adams Liebert ATTEST: McDonald Rashkin Jean Ann Wulf, City Clerk-Treasurer Steeber Voskuil APPROVED AS TO FORM: Wald Klimczyk, City Attorney Proposed by: Community Development Department Prepared by: Community Development Department Ý·¬§ ±º Ö¿²»ª·´´» Ý·¬§ ±º Ö¿²»ª·´´» Í«¾¶»½¬ Ð®±°»®¬§ q Ô»¹»²¼ ÍËÞÖÛÝÌ Í×ÌÛÝ×ÌÇ ÑÚ ÖßÒÛÍÊ×ÔÔÛ Ü¿¬»æ ïïñîçñïï Í½¿´»æ ïþã ëððù Ó¿° Ý±±®¼·²¿¬»æ Ôóé ÔÑÝßÌ×ÑÒ ÓßÐ Ý×ÌÇ ÑÚ ÖßÒÛÍÊ×ÔÔÛ ÓßÐ ï ßÒÒÛÈßÌ×ÑÒ ÑÒ ÍÑËÌØ ËÍØ ëï ÐÔßÒÒ×ÒÙ ÍÛÎÊ×ÝÛÍ ÍæÐ®±¶»½¬ÄÐ´¿²²·²¹Ä½¿»ÄîðïïÄÔóéÁß²²»¨¿¬·±² Í±«¬¸ ËÍØ ëï ÞîÓî Ý·¬§ ±º Ö¿²»ª·´´» Óï Îï ÍÌØ ïï Þì Þí Îí Óï Í«¾¶»½¬ Ð®±°»®¬§ Óï Ý·¬§ ±º Ö¿²»ª·´´» ß Ý q Ô»¹»²¼ ÍËÞÖÛÝÌ Í×ÌÛÝ×ÌÇ ÑÚ ÖßÒÛÍÊ×ÔÔÛ Ü¿¬»æ îñîñïî Ó¿° Ý±±®¼·²¿¬»æ Ôóé ÔÑÝßÌ×ÑÒ ÓßÐ Ý×ÌÇ ÑÚ ÖßÒÛÍÊ×ÔÔÛ ÓßÐ ï ßÒÒÛÈßÌ×ÑÒ ÑÒ ÍÑËÌØ ËÍØ ëï ÐÔßÒÒ×ÒÙ ÍÛÎÊ×ÝÛÍ ÍæÐ®±¶»½¬ÄÐ´¿²²·²¹Ä½¿»ÄîðïïÄÔóéÁß²²»¨¿¬·±² Í±«¬¸ ËÍØ ëï Æ±²·²¹ éçúò÷ùè ûê÷û POLICE DEPARTMENT MEMORANDUM February 7, 2012 TO: City Council FROM: Police Chief Dave Moore SUBJECT: Second Reading, Public Hearing and Action on a Proposed Ordinance Amending City of Janesville Alcohol Regulations to Allow Class A liquor and Beer Sales Starting at 8:00 o’clock a.m. (Revised File Ord. 2012-508) BACKGROUND Governor Scott Walker recently signed into state law 2011 Wisconsin Act 97 adopted by the Wisconsin Legislature. That new law allows the sale of beer (fermented malt beverages) and alcohol (intoxicating liquor) by liquor stores (Class A alcohol licensed establishments) after 6:00 o’clock a.m. each day, two (2) hours earlier than the 8:00 o’clock a.m. later opening time previously mandated. 2011 Act 97 applies only to Class A off-premises consumption sales – meaning “liquor stores” that sell beer and liquor for consumption off of the premises. It does not apply to bars or taverns licensed Class B for on-premises consumption. City of Janesville ordinances (5.06.240) currently only allow the sale of fermented malt beverages after 8:00 o’clock a.m., but are silent regarding the sale of intoxicating liquor. Therefore, with the change in State law, intoxicating liquor may be sold after 6:00 o’clock a.m. whereas, fermented malt beverages may not be sold until 8:00 o’clock a.m. This matter was brought before the Alcohol License and Advisory Committee - ALAC on January 3, 2012. The ALAC recommended to the City Council that the sales of fermented malt beverages should be allowed at 6:00 o’clock a.m. At the January 23, 2012 City Council meeting, Council moved and passed to amend the first reading so that the public notice upon the introduction was that the sale of both fermented malt beverages and intoxicating liquors would commence at 8:00 o’clock a.m. each day at Class A alcohol licensed establishments in the City of Janesville. As a result of this motion to amend the introduction of proposed Council File Ordinance No. 2012-508, the Common Council changed the language in the ordinance that is being forwarded for the second reading, public hearing, and Council action, on Monday, February 13, 2012, with the change from 6:00 o’clock a.m. sales of both beer and intoxicating liquor to 8:00 o’clock a.m. Police Department Recommendation The police department recommends that the sales of fermented malt beverage and intoxicating liquors occur at the same time whether it is at 6:00 o’clock a.m. or 8:00 o’clock a.m. The department takes an impartial position on the time of day that the sales should occur. The Police Department recommends adoption of ordinance 2012-508 City Manager Recommendation The City Manager supports the position of the police department REVISED ORDINANCE NO. 2012 - 508 An ordinance permitting Class A alcohol licensed stores to sell beer and intoxicating liquor starting at 8:00 o’clock a.m. until 9:00 p.m. daily, with penalties for violations thereof as set forth in JGO 5.06.470. THE COMMON COUNCIL OF THE CITY OF JANESVILLE DO ORDAIN AS FOLLOWS: SECTION I. Section 5.06.242 A. of the Code of General Ordinances of the City of Janesville is hereby created to read as follows: “5.06.242 Sale of Intoxicating Liquor in Class A Stores After 9:00 p.m. A. The sale of intoxicating liquor upon the premises of a Class “A” (liquor store) intoxicating liquor alcohol beverage licensed premises shall cease daily at nine o’clock (9:00) p.m. and shall not resume until eight o’clock (8:00) a.m. the following morning. No intoxicating liquor may be sold between the hours of 9:00 p.m. and 8:00 a.m. upon any “Class A” intoxicating liquor alcohol beverage licensed premises. This restriction by ordinance is authorized by Sections 125.68(4)(b) and (d) of the Wisconsin Statutes, as from time to time amended, and is hereby enacted in conformity therewith.” ADOPTED: Motion by: Second by: APPROVED: Councilmember Aye Nay Pass Absent Dongarra-Adams Eric J. Levitt, City Manager Liebert McDonald ATTEST: Rashkin Steeber Voskuil Jean Ann Wulf, City Clerk-Treasurer APPROVED AS TO FORM: Wald Klimczyk, City Attorney Proposed by: City Clerk-Treasurer Prepared by: City Attorney Economic Development Department Memorandum February 13, 2012 TO: Janesville City Council FROM: Vic Grassman, Economic Development Director SUBJECT: Action on a proposed resolution amending the Project Plan and boundaries for Tax Increment Finance District No. 35 (File Resolution No. 2012-875). ____________________________________________________________________________ SUMMARY Staff is proposing to amend the boundary of TIF No. 35 to include an 81-acre parcel of land acquired by the City located east and adjoining State Highway 51. The proposed amendment is being created to accommodate potential industrial development in the amended boundary. The Plan Commission held a public hearing on the amendment for TIF No. 35 at their February 6, 2012 meeting and recommended its adoption. The Administration recommends that the Council adopt Resolution No. 2012-875 approving the amendment of and setting the boundaries for TIF No. 35. If the Resolution is approved, TIF No. 35 will go to a Joint Review Board for review and approval on February 14, 2012. DEPARTMENT RECOMMENDATION The City of Janesville has successfully used tax increment financing as an economic development tool. With the poor state of the national economy, Janesville needs to remain aggressive in pursuing all development opportunities. Staff recommends that the Council adopt Resolution No. 2012-875 approving the amendment to the Project Plan and boundaries of Tax Increment Finance District No. 35. CITY MANAGER RECOMMENDATION The City Manager recommends approval. The estimated project costs reflect the best estimates the City has of anticipated costs and supporting revenues for the future of TIF 35. These costs include the Shine Project, if it is approved and Shine moves forward as well as future unknown costs for the approximately 200 undeveloped acres adjacent to Highway 11. SUGGESTED MOTION A motion to approve Resolution No. 2012-875 approving the amendment of the TIF 35 Project Plan and setting the boundaries for TIF No. 35. ANALYSIS In 2011, TIF No. 35 was created to attract potential industrial developments. TIF 35 contains a 226-acre parcel of land, at the southwest corner of STH 11 and Beloit Avenue which is a certified “shovel ready” industrial development site. Proposed Amendment No. 1 will modify the TIF No. 35 boundary to add approximately 81 acres of undeveloped land adjoining the southwest portion of the existing TIF boundary. Since February 2011, the City has had an option to purchase an additional 84 acres of land to the south of the existing TIF 35 to accommodate future industrial development. With the option set to expire on December 31, 2011, the City Council executed the option to purchase the land at their December 22 Meeting. Upon annexation, this land will be zoned M-1 Light Industrial and included within the boundaries of TIF No. 35 by approval of Amendment No. 1 to the TIF No. 35 Project Plan. In addition, total TIF incremental revenues over the maximum 20-year life of TIF No. 35 are projected to exceed TIF costs and the TIF district is expected to be economically viable. The expenditure of any TIF funds would be linked to a specific development agreement which assures that property values and corresponding tax increments will be satisfied in order to fully recover TIF improvement costs. City Staff and Plan Commission find the proposed Amendment No. 1 to TIF District No. 35 to be consistent with established City plans and policies. The proposed amendment to TIF District No. 35 represents an opportunity for the City to attract a new industrial project or future projects. The area is appropriate for industrial use due to its proximity to USH 51, STH 11, I-39/90, and the Southern Wisconsin Regional Airport. In addition, the amended area is contiguous to the existing certified site with municipal utilities readily available making the property ideal for industrial development. PLAN COMMISSION ACTION – 6 FEBRUARY 2012 Brad Schmidt, Associate Planner, presented the written staff report. There was no discussion. The public hearing was opened and no one appeared to speak regarding this item. The public hearing was closed. Commissioner Consigny asked if the City was in favor of the proposed development. Cherek indicated that staff supports the proposed amendment to TIF 35 and zoning of property within the boundary area to allow for future industrial development. Commissioner Marklein referred to Map 4 of the Project Plan showing future improvements and asked if the road configuration had changed from the original TIF 35 approval. Schmidt answered no. Commissioner Marklein asked if Street A would be connected through the subject property to USH 51. Cherek stated that the likely thru-connection would be along Knilans Road as it would tie into an existing street intersection at USH 51 west of the site. Cherek added that individual driveway access to the TIF amendment area from USH 51 may also be pursued. Commissioner Siker asked if M1 was a satisfactory zone district for the proposed use and Schmidt answered that it was. Commissioner Voskuil asked for an explanation of the increased 2014 expenditures listed on Page 12 in the Project Plan. Hulick indicated that the increase in 2014 is based on a perspective manufacturer’s (SHINE Medical) development plans. Hulick noted that SHINE does not intend to begin construction until 2014 at the earliest. Therefore, there will be a delay in the installation of certain public improvements thus deferring the costs for those facilities later than anticipated from the original adoption of the TIF 35 Project Plan. The Administration believes that these are the best cost estimates that can be provided based on information available at this time. Commissioner Werner questioned the difference between incentives referred to on Page 11 of the Project Plan as opposed to the incentives shown on Page 12. Hulick indicated that the total amount of incentives is equal from both pages, but the difference between the two pages is a result of additional development costs that will be incurred for site improvements. There was a motion by Commissioner Consigny with a second by Commissioner Madere to approve Resolution No. 2012-01, approving Amendment No. 1 to the Project Plan and boundary for Tax Increment Finance District No. 35, and to forward this item to the City Council with a favorable recommendation. The motion carried on a 6-0-0 vote. Resolution No. 2012-875 RESOLUTION APPROVING AMENDMENT NO. 1 TO THE PROJECT PLAN FOR TAX INCREMENT FINANCE DISTRICT NO. 35 WITHIN THE CITY OF JANESVILLE, ROCK COUNTY, WISCONSIN WHEREAS, the Common Council of the City of Janesville adopted Resolution No. 2011-816 on August 22, 2011, creating the City of Janesville Tax Increment Finance District No. 35 in accordance with the provisions of Wisconsin Statutes Section 66.1105; and WHEREAS, the City of Janesville Administration is now proposing Amendment No. 1 to the Project Plan for TIF No. 35 revising the project budget and amending the TIF No. 35 boundary to include an additional 84 acres of industrial land; and WHEREAS, the Janesville Plan Commission has held a public hearing on proposed Amendment No. 1 to the Project Plan of Tax Increment District No. 35 and the proposed new boundaries of the Amended TIF district on the 6 day of February, 2012, and found both proposed amendments to be acceptable and consistent with the long range plans of the City and its best interests; and WHEREAS, the Chief Executive Office of the Janesville School District, Rock County Board, Blackhawk Technical College, and other entities having the power to levy taxes upon the property located within the proposed Tax Increment District No. 35 have been notified of the proposed Amendment to the Project Plan for TIF No. 35, pursuant to Section 66.1105 (4)(a) and (e), Wisconsin State Statutes; and WHEREAS, Tax Increment Finance District No. 35, as amended, is declared to be an “industrial TIF district”, where more than 51% of the land is currently zoned M-1 Industrial and has been found suitable for industrial development within the meaning of Section 66.1101, Wisconsin State Statutes, and will remain zoned for industrial purposes for the life of the TIF District; and WHEREAS, the project costs directly serve to promote industrial development, consistent with the purpose for which the TIF District was created, and the improvement of the proposed additional areas for industrial projects will significantly enhance the value of all property within the City of Janesville; and WHEREAS, the equalized value of taxable property within the amended boundaries of TIF No. 35 plus the value increment of all existing Janesville TIF Districts does not exceed twelve percent (12%) of the total equalized value of property within the City of Janesville; and WHEREAS, the amended Project Plan for Tax Increment District No. 35 is economically feasible and in conformity and has been found to be in accordance with the City’s Resolution No. 2012-875 TIF 35 Amendment No. 1 Page 2 General Development Plans, Zoning Ordinance, and other relevant policies; and that implementation of the improvements as set forth in the Amended TIF No. 35 Project Plan is in the best interest of the City of Janesville and for the benefit of its residents and taxpayers. NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of Janesville that they hereby approve Amendment No. 1 to the Project Plan for City of Janesville Tax Increment Finance District No. 35, and refer Amendment No. 1 to a Joint Review Board for review and approval according to Wisconsin Statutes. ADOPTED: Motion by: Second by: APPROVED: Councilmember Aye Nay Pass Absent Dongarra-Adams Liebert Eric J. Levitt, City Manager McDonald Rashkin ATTEST: Steeber Voskuil Jean Ann Wulf, City Clerk-Treasurer APPROVED AS TO FORM: Wald Klimczyk, City Attorney Proposed by: City Manager Prepared by: Community Development TAX INCREMENT FINANCE DISTRICT No. 35 PROJECT PLAN Adopted August 22, 2011 AMENDMENT No. 1 February 13, 2012 Prepared By: Economic Development Agency Accounting Division City Manager’s Office City of Janesville, Wisconsin 18 N. Jackson St. Janesville, WI 53545 CITY OF JANESVILLE TAX INCREMENT FINANCE DISTRICT No. 35 TABLE OF CONTENTS I. WISCONSIN TAX INCREMENT LAW AND PROCESS .......................... 1 II. TIF No. 35 PLAN OBJECTIVES ............................................................ 2 III. BOUNDARIES OF TIF No. 35 ............................................................ 3 IV. EXISTING ZONING AND PROPOSED LAND USES ............................... 5 V. PROPOSED TIF PUBLIC WORKS PROJECTS AND ................................ 9 IMPROVEMENTS VI. DETAILED LIST OF ESTIMATED PROJECT COSTS .............................11 VII. ECONOMIC FEASIBILITY AND METHODS OF FINANCING ..............15 VIII. PROPOSED CHANGES IN ORDINANCES, CODES, & PLANS .............19 IX. LIST OF ESTIMATED NON-PROJECT COSTS ........................................20 X. METHODS FOR RELOCATION OF DISPLACED PERSONS .................20 XI. PROMOTION OF THE ORDERLY DEVELOPMENT .............................20 MAPS 1. Map 1 TIF No. 35 Boundary Map ……………. ........................................... 4 2. Map 2 TIF No. 35 Zoning ............................................................ 7 3. Map 3 TIF No. 35 Existing Conditions and Land Use ................................. 8 4. Map 4 TIF No. 35 Proposed Improvements ..................................................13 5. Map 5 TIF No. 35 Property Within ½ Mile of Boundary ..............................14 LEGAL AND PROCEDURAL 1. Legal Opinion From City Attorney on Project Plan 2. TIF No. 35 Plan Adoption and Creation Resolutions 3. Joint Review Board Resolution City of Janesville Tax Increment Finance District No. 35 Project Plan WISCONSIN TAX INCREMENT LAW AND PROCESS I. Under Wisconsin Statutes Section 66.1101 (1), the State declared that the policy of the State is "to encourage and promote the development of industry to provide greater employment opportunities and to broaden the State's tax base to reduce the tax burden of residents and homeowners." Locally, the City of Janesville has adopted an Economic Development Policy designed to "diversify the economic base of the City through the retention and expansion of existing businesses ...” In addition, the City seeks to attract new industries through the creation of fully improved industrial parks. One tool designed to help stimulate new development is "Tax Increment Financing (TIF)". When the State Legislature enacted the Tax Increment Law (ss 66.1105) in 1975, they found, "that the accomplishment of the vital and beneficial purposes of the Promotion of Industry Statute (ss 66.1101) is being frustrated by the lack of incentives and financial resources." One stated purpose of the Tax Increment Law, "is to create a viable procedure by which a city or village, through its own initiative and efforts, may finance projects which will tend to accomplish," the promotion of industry. The Tax Increment Law allows a community to recapture the costs of public expenditures made to stimulate new development, from the property taxes generated by the new development. Fundamental to the TIF law is the concept that new development will benefit an area broader than the municipality in which the development occurs. However, an inequity occurs because the community is left to finance the entire cost of public expenditures needed to facilitate the development. The TIF law recognizes that without the TIF expenditures, the development could not have occurred. Thus, the TIF law provides that all property taxes levied on increased property value within a TIF district are retained by the community to finance the public expenditures made within the TIF district. The base value (the value that existed at the time the TIF district is created), however, continues to provide same level of revenues to other taxing jurisdictions. Once all of the public expenditures have been repaid, all taxing jurisdictions can collect taxes levied on the new property value. State statutes are very specific as to how a TIF district is created. First, a TIF project plan is developed and presented to the Plan Commission for a formal public hearing. The Commission makes a recommendation on the TIF project plan to the City Council. The Council then must pass a resolution adopting the TIF project plan and establishing the TIF boundaries. Finally, a Joint Review Board is created with members from the City, school district, county, vo-tech district, and one member at large. The Joint Review Board reviews the TIF plan and public hearing comments and approves the creation of the TIF district. Amendments to a TIF Project Plan may be made by following the same procedures. TIF project plan amendments may be necessary to revise projected budgets and/or to amend the boundaries of the original TIF district. This document will meet the statutory requirements for a Project Plan for Tax Increment Finance District No. 35. TIF No. 35 PLAN OBJECTIVES II. Industrial development activities in the City of Janesville are guided by the City's Economic Development Strategy and implemented in accordance with an Economic Development Policy. The overall goal for the City's industrial development effort is to diversify the City's economic base through the retention and expansion of existing businesses, and through the attraction of growing industrial and large regional service sector employers that will create new employment opportunities and expand the local property tax base. TIF No. 35 will advance the City of Janesville's industrial development objectives and specifically will: A. Promote industry retention, expansion, and attraction through the development of a new fully improved certified industrial park, thereby creating new jobs and increased tax base. B. Provide appropriate financial incentives to encourage industrial expansion. C. Reduce the financial risk to the taxpayer by timing the implementation of the Project Plan with the creation of additional property value through industry expansions. D. Generate sufficient new property tax increments within eight (8) to ten (10) years from each specific development project within the TIF District to fully repay the City's TIF project expenditures associated with the development project. BOUNDARIES OF TIF No. 35 III. Described as follows: Pt SE. ¼ and Pt SW. ¼ Sec 13-2-12 and also Pt NE. ¼ and NW. ¼ Sec 24-2-12, 4TH PM, City of Janesville, Rock Co, WI DAF: Com NE cor sd Sec 24; th S0°18'59"E alg E L NE ¼ sd Sec 24, 400.21'; th N88°27'04"W 33.02' to W L CTH G and POB; th N88°27'04"W 3826.97' m/l; th N0°02'51"W 1704.64' to N L SE ¼ SW ¼ sd Sec 13; th S89°02'36"E alg sd N L 1291.03' to NE cor sd SE ¼ SW ¼ sd Sec 13; th N0°00'24"E alg N-S CL sd Sec 13, 1283.03' to S L STH 11; th S88°41'40"E alg sd S L 1757.16' to W L Lot 1 CSM rec in Vol 8 Pgs 114-115; th S1°18'01"W alg sd W L 217.05' to SW cor sd CSM; th S88°42'05"E alg S L sd CSM 110.0' to SE cor sd CSM; th N1°18'01"E alg E L sd CSM 200.0'; th S88°41'40"E 70.0' to NW cor Lot 1 CSM rec in Vol 9 Pgs 132-133; th S1°18'01"W alg W L sd Lot 200.0' to SW cor sd Lot; th S88°42'05"E alg S L sd Lot 115.05' to SE cor sd Lot; th N1°18'01"E alg E L sd Lot 200.0' to S L STH 11; th S.88°41'40"E 163.80' alg sd S L STH 11; th S71°01'05"E alg sd SL 293.11' to W L CTH G; th S05°31'29"E 429.43' alg sd W L; th cont S alg sd W L 187.2' m/l to pt on N L CSM rec in Vol 15 Pgs 135-136; th N88°34'17"W 7.0' m/l to NE cor Lot 1 sd CSM; th S alg E L sd Lot 1 570.00' to SE cor sd Lot; th S88°34'17"E 7.0' m/l to W L sd CTH G; th S alg sd W L 1722.62' m/l to POB. 6-17-126, 6-17-126.4, 6-17-126.6,pt 6-17-125, pt 6-17-212, & pt 6-17-214 Also containing the following described property: PART OF THE NW 1/4 OF SECTION 24, TH T.2N., R.12E. OF THE 4 P.M., TOWN OF ROCK, ROCK COUNTY, WISCONSIN. DESCRIBED AS FOLLOWS: Commencing at an aluminum monument at the North 1/4 Corner of said Section; thence S.0°43’12”E. along the North-South Centerline of said Section, 400.30 feet to an iron pin monument on the South Line of a Parcel described in Document No. 1690897, also being at the place of beginning for the land to be herein described; thence S.0°43’12”E. continuing along said North-South Centerline, 1692.15 feet to an iron pin on the Easterly extension of the North Line of a tract described in Document No. 1401544; thence N.89°04’46”W. along said North Line and its extension, 2477.53 feet; thence N.6°58’46”E. 2.22 feet; thence N.15°55’12”E. 542.01 feet; thence N.21°33’01”E. 230.09 feet; thence N.18°14’52”E. 233.64 feet; thence N.47°44’21”E. 625.53 feet; thence N.44°27’40”E. 432.15 feet to said South Line of said Parcel (Document No. 1690897); thence S.88°30’01”E. along said South Line, 1384.17 feet to the place of beginning. 6-17-214 & 6-17-215 MAP 1 EXISTING ZONING AND PROPOSED LAND USES IV. The City of Janesville is proposing to createcreated TIF No. 35 to expand an existing industrial park on the City’s south side. At the time of its creation, TIF District No. 35 contains one, 226 acre parcel of vacant industrial land in agricultural use in an industrially zoned area on the City's south east side. The parcel is unimproved and has been used for agricultural crop production for decades. In 2004, the City negotiated to purchase an additional 226 acres of land located south of STH 11 and west of County Trunk Highway G. Upon annexation, this land was zoned M-1 Light Industrial. Since that time, The City went through a lengthy site certification process in 2010 to have the 226 acre site deemed as a “shovel ready” certified industrial site. TIF No. 22 has seen tremendous expansion and growth, and is set to be retired within the next 3-5 years. Therefore, the creation of TIF No. 35 would allow allowed the 226 acre certified site to continue to be marketed and incentivized with tax increment financing to make the site more appealing for industrial development and expansion. Amendment No. 1 to TIF 35 will amend the original boundary to add an additional 84 acres of vacant land adjoining the southwest portion of the existing TIF boundary. Since 2009 the City has had an option to purchase an additional 84 acres of land to the south of the existing TIF 35 to accommodate future industrial development. With the option set to expire on December 31, 2011, the City executed the option to purchase the additional 84 acres of land. Upon annexation, this land will be zoned M-1 Light Industrial and included within the boundaries of TIF No. 35 by approval of Amendment No. 1 to the TIF No. 35 Project Plan. The City’s long term growth plans in this part of the city calls for continued expansion of industrial development along CTH G and State Trunk Highway 11. Therefore, TIF No. 35 could be amended to include additional industrial development sites as they become available and are annexed into the City of Janesville State law requires that not less than 50% of the land within a TIF district be “suitable for ‘industrial sites’ within the meaning of (Wisconsin Statutes) s. 66.1101 and zoned for industrial use”. Within TIF No. 35 70% of the land is proposed for industrial uses and 30% is proposed for green space and storm water uses, thus meeting the required standard. All lands within TIF No. 35 zoned for industrial uses will remain zoned for industrial uses for the life of the TIF district. In addition, the Wisconsin TIF Law prohibits “newly platted residential areas” from being considered as TIF project costs. No residential development is planned for TIF No. 35. The TIF District Project Plan proposes to improve these properties with streets and utilities to create additional industrial sites. The timing of the street and utility improvements will be phased to meet the needs of specific development projects thereby minimizing the risk of incurring development costs in advance of tax-producing development projects. MAP 2 MAP 3 PROPOSED TIF PROJECTS AND IMPROVEMENTS V. The public expenditures proposed in TIF No. 35 will be linked to the expansion of the industry within the district. The expansion of the industry will increase property values and will generate new tax increments that will allow the City to recover its TIF costs. To allow this expansion to occur, the City will need to extend utilities to the property and construct an extension of Progress Drive. As the demand for industrial sites increases, the City will construct new streets and utilities to those sites as necessary to facilitate development and expansion. Finally, the Project Plan provides funds for marketing the new industrial sites and for providing incentive financing to companies locating new facilities within the TIF district. The kind, number, and location of all proposed improvements proposed for TIF No. 35 are shown on Map 4 - Improvement Plan. A. Transportation Improvements Transportation improvements may include the construction of the southerly extension of Progress Drive South of State Trunk Highway 11 and easterly extensions of a street network from the newly extended portion of Progress Drive to County Trunk Highway G. County Trunk Highway G may be widened to a 4-lane cross section as the traffic to TIF No. 35 increases with development. In addition, the TIF Project Plan allows for the construction of approximately 10,500 feet of new streets to serve the new industrial sites. Map No. 4 shows the planned location of these road improvements, however, the actual location of the roads may change depending on the needs of specific development projects. Wherever new street construction occurs, sidewalks or recreational trails, street trees, and landscaping may be installed along the new frontage road. B.Utility Costs As new streets are constructed to provide access to industrial sites, sewer, water, gas and electric utilities will be installed within the rights-of-way. In addition, a storm sewer collection system including underground piping, surface detention ponds and safety fencing may be installed. These utility improvements will be phased along with the street construction to meet the needs of specific development projects. The utility costs will be included as TIF expenditures. C. Street Lighting and Landscaping As new streets are developed within TIF No. 35, street lights and street trees may be installed. In addition, a landscaping buffer between the industrial uses and the open space/residential uses to the west is planned as a TIF cost. D. Marketing and Incentive Financing In order to attract new development to the TIF No. 35 industrial park, it may be necessary to implement a marketing program. Marketing activities may include the development of brochures, photographs, topography and maps for use with industry prospects. Once the marketing materials are available, a direct mail program may be implemented to attract new development. Marketing activities may also include the payment of real estate commissions where a private “buyer’s broker” facilitates the sale of a new development site in TIF No. 35. Where a specific industry has been identified, incentive financing may be necessary to ‘close the deal’. Incentive financing may include below interest loans, funding for relocation, worker training, and unique start-up costs, and/or similar financing programs. Financing may go directly to a development project or to capitalize a revolving loan fund to provide financing assistance for industrial expansion projects throughout the TIF District. Additionally, changes to State Law also allow the expenditure of TIF funds within ½ mile of an existing TIF boundary. While much of the land within ½ mile of TIF No. 35 is currently located outside the City of Janesville corporate limits, the City does have a boundary agreement with the Town of Rock, and land surrounding the airport will be annexed to the City of Janesville as development occurs. Where industrial development projects occur on land annexed to the City within this ½ mile boundary, funding from TIF No. 35 may be used to support the development project. If the development project is contiguous to TIF No. 35, the City may propose a boundary amendment to the TIF No. 35 Project Plan. The development projects located within ½ mile of proposed TIF No. 35 may need project financing and/or development incentives to maintain employment levels or to undertake future expansion projects. E. Administrative Costs The TIF No. 35 project plan includes the cost incurred for administrative, professional, organizational, and legal services related to the creation and administration of the TIF district. Direct engineering costs shall be charged to the specific construction projects within the TIF District. Direct legal and planning costs will be charged as administrative costs. The cost of the three TIF audits required under Wisconsin Statutes ss 66.1105 will be included as TIF project costs. In addition, administrative costs will include any TIF Plan review fees charged by the Department of Revenue. F. Land Acquisition In order to create a new industrial park, the City has acquired a 226 acre parcel on the west side of County Trunk Highway G and south of State Trunk Highway 11 and an additional 84 acres to the south of the existing TIF 35 boundary along the east side of State Highway 51. This Project Plan does not provide for any future land acquisitions. However, in the event of future land acquisitions, payments to neighboring townships to compensate them for lost tax revenues where TIF districts include newly annexed property will also be considered a TIF land acquisition expense. Land acquisition, surveying, soil testing, environmental engineering, and title policy expenses may be considered TIF project costs. Additionally, any relocation expenses incurred by future land acquisitions including crop damages would be considered a TIF land acquisition expense. Payment of any land conversion penalty under the provisions of Wisconsin Statutes section 74.485 would also be considered a land acquisition cost. DETAILED LIST OF ESTIMATED PROJECT COSTS VI. In order to determine the economic feasibility of the proposed TIF District No. 35, total project costs must be estimated and compared to the projected tax increments that will be generated by the new development in the TIF district. Based on 2011 construction costs, TIF No. 35 improvement costs are estimated as follows: A. Transportation Improvements $4,155,500 B. Water and Sanitary Sewer Costs $2,823,200 B. Stormwater Improvements $2,011,300 $2,589,300 C. Project Incentive Financing $4,950,000 $6,450,000 D/E. Marketing & Administration $61,500 F. Land Acquisition $1,531,824 Total Cost of Improvements $14,001,500 $17,611,324 The estimated cost of TIF expenditures is $14,001,500 $17,611,324. Under the revised TIF law, project costs may be incurred over the first fifteen (15) years of the TIF district, while TIF revenues will be collected over a maximum of twenty (20) years. The City will have to finance any negative TIF fund balance through interfund borrowing. Based on conservative projections, including the debt service and interfund borrowing costs of $5,445,818 $6,978,425 . the total estimated TIF No. 35 project costs to $19,447,318 $24,589,749 All project costs and interfund borrowing estimates are based on the most current cost data available in July, 2011 and may be adjusted within the total amount shown without modification or amendment of this TIF No. 35 Project Plan. Under the changes to the TIF law enacted in 2004, all of the TIF No. 35 project costs except debt service and interfund borrowing will be incurred during the first fifteen (15) years of the TIF District. Table No. 1 shows the schedule and timing of the proposed expenditures. The actual timing of expenditures will be contingent on the commitments from industries locating facilities and guaranteeing a minimum property value that will generate sufficient tax increments over the life of the TIF district to cover the TIF project costs. This Project Plan includes funds to market the vacant industrial land within the TIF District for industrial and development. Table No. 1 Tax Increment District No. 35 Summary of TIF Costs By Year Year Type of Cost Cost 2011 Marketing and Administration, Engineering Services $362,500 2012 Land, Streets, Utilities, Incentives, and Admin $6,533,250$7,258,574 2013 Incentives, Streets, Utilities, Marketing $5,328,750$5,617,750 2014 Incentives, Streets, Utilities, Marketing $508,780$3,104,250 2015 Incentives, Marketing and Administration $507,250 2016 Incentives, Marketing and Administration $503,750 2017 Incentives, Marketing and Administration $251,875 2018 Administration $5,375 Total Cost of Improvements $14,001,500$17,611,324 Debt Service and Interfund Borrowing $5,445,818$6,978,425 Total Estimated TIF No. 35 Costs $19,447,318$24,589,749 -------------------------------------------------------------------------------------------------------- Prepared By: City Manager’s Office and Accounting MAP 4 MAP 5 ECONOMIC FEASIBILITY AND METHODS OF FINANCING VII. A. Economic Feasibility Analysis Under Wisconsin's Tax Increment District Law (ss. 66.1105), 100% of the property taxes levied against new property value created within a TIF district is retained by the City to pay for improvement costs that were incurred to attract the new development. Implicit in the law is the concept that without the improvements, the attraction of new development, the creation of new jobs, and the expansion of the tax base would not occur. The Wisconsin TIF law as revised by the Legislature, allows the City fifteen (15) years in which to make the improvements needed to stimulate and support development. The property tax increments generated by the new development are retained by the City until all TIF costs are paid. In no case shall the TIF district have a life longer than twenty (20) years. The City of Janesville's Tax Increment District No. 35 will be was created by Council action in July, 2011. The original TIF No. 35 Project Plan will be amended by the City Council in January, 2012 to revise the budget and to amend the boundary to include an additional 84 acre parcel of land. Therefore, all TIF project improvements must be completed by September, 2026. The taxes on any increased property value in the district between 2013 and 2031 will be retained by the City to repay the TIF project costs. TIF No. 35 will be dissolved when all TIF project costs are repaid, or in July 2031, whichever comes first. In order to determine the economic feasibility of the proposed TIF district, estimated TIF costs must be compared to projected TIF property tax increments. Where tax increments exceed TIF costs over the twenty (20) year life of the TIF district, the TIF district is considered economically feasible. The City of Janesville has made conservative assumptions about the future to determine the economic feasibility of TIF No. 35. All TIF costs related to industrial expansion projects are incurred according to the schedule shown in Table No. 1. TIF property value increases for are shown for the installation of streets and utilities, as well as potential new land acquisitions for future industrial projects to be developed. Where possible, the construction of new streets and utilities will be phased and linked to known development projects. The City will enter into binding contracts with the industries locating within TIF No. 35 that will guarantee the minimum amount of investment needed to fully amortize all TIF costs associated with each project within 8 to 10 years. The overall TIF District should be able to recover all costs by the year 2030. The equalized value property tax mill rate levy is projected to increase 0% per year. This assumption is also conservative. In recent years, the equalized value property tax mill rate in Janesville increased slightly. Based on these assumptions, the $51,500,000 $62,000,000 in new property value generated between 2013 and 2019 will create sufficient new property tax increments to repay all planned TIF project costs. The City will limit the implementation of all TIF expenditures until the actual levels of new property value are known. TIF project costs of $14,001,500$17,611,324 plus financing costs of $5,445,818 $6,978,425 equate to a total TIF Cost investment of $19,447,318 $24,589,749. These monies will only be expended if the property value of the industrial construction is adequate to ensure a sufficient tax increment to recover the cost within the life of the TIF district. If a total of $51,500,000 $62,000,000 of new property value is created as projected, the TIF district will generate a total of $30,423,005 $24,589,749 in property tax increments over the 20 year life of the district. Since property tax increments are projected to exceed TIF costs including debt service by $390,294in 2030 $464,558 in 2029 TIF No. 35 is found to be economically feasible. Projected TIF revenues will cover TIF costs within 19 18 years and the City projects that TIF No. 35 will be dissolved by 2031. Since there is no guarantee that new development projects will be found to construct new property value within TIF No. 35, the City will only implement additional street and utility construction project when they are needed to prepare new industrial sites for specific projects. The TIF plan includes $4,155,500 in transportation improvements including improvements to CTH G and HWY 51 as well as street extensions through the industrial site. Additional, the Project Plan includes $$2,823,200 in utility improvements including extensions of water mains and sanitary sewer to serve the site, as well as $2,011,300 $2,589,300 in stormwater improvements. B. Methods of Financing Wisconsin Statutes provide several methods of financing the cost of improve- ments in tax increment districts. For smaller amounts, financing through the general fund may be feasible. Transfers can be made from the municipal general fund account into the TIF expenditure account to cover the cost of TIF improvements. This method of financing avoids the interest cost associated with municipal borrowing. However, since the General Fund balance is reduced, the General Fund loses interest income, so an interfund borrowing cost is charged to the TIF account. State law also provides for municipal borrowing. Community borrowing is divided into two forms -- that subject to a statutory limitation and borrowing not subject to limitation. Possible funding sources include: 1. General Obligation Borrowing - Is sometimes referred to as a local promissory note from a bank, State Trust Fund, or other lending institution. This form of borrowing requires little effort or legal costs and works well for smaller sums. This sort of borrowing is included in the municipal borrowing limitation. 2. General Obligation Bonding – Is an irrepealable property tax obligation of the community. General obligation bonds can often be sold at lower interest rates than other forms of borrowing. However, there are additional regulations and requirements that make G.O. Bonds suitable for larger projects. G.O. Bonds are included in the municipal borrowing limitation. 3. Mortgage Revenue Bonds - Are repaid through the revenue generated by a public utility like a water or sewer utility. Revenue bonds also have regulatory and legal requirements that make them suitable for larger project costs. Since revenue bonds do not pledge the community's taxing capacity, they are not subject to a municipal borrowing limitation. 4. Federal and State Grant or Loan Programs - Like Community Development Block Grants or State Transportation aids are sometimes available to supplement local funding sources. However, the amount of grant dollars available is limited and state and federal funding is uncertain given the need to balance budgets. The actual method of financing specific TIF projects will be determined by the City based on the current fiscal condition of the City, anticipated non-TIF capital needs, municipal borrowing rates and terms, and the amount of financing needed. Where general obligation borrowing is used, TIF financing costs have been calculated assuming financing over ten (10) years, with equal principal payments. The City will not proceed with any phase of the planned public improvements until a developer or business is committed to construct a new building or renovate an existing building with a value sufficient to generate the property tax increments needed to cover the cost of the improvements. Therefore, the actual City expenditures in TIF No. 35 may be substantially different that those shown in the project plan. C. Additional Economic Benefits The economic feasibility analysis has shown that the property tax increments will be sufficient to cover all TIF project costs over the twenty (20) year life of the TIF district. The development of TIF No. 35 will facilitate an industrial expansion, increase property values, and create new jobs in the City of Janesville. These jobs will help diversify the local economy and the increased manufacturing and warehousing/distribution payrolls will have a positive multiplier effect in the trade and service sectors. PROPOSED CHANGES IN ORDINANCES, CODES, & PLANS VIII. The proposed TIF No. 35 project plan is in conformance with the City of Janesville's present zoning ordinance, with the City's Industrial Development Plan and the General Development Plan. All of the properties within TIF No. 35 have been found to be suitable for industrial development in accordance with Wisconsin's Promotion of Industry Statute ss 66.1101, and will remained zoned for industrial purposes for the life of the TIF district. All development in TIF No. 35 will have to conform with the State Building Codes and will be subject to the City's permitting and inspection procedures. The TIF No. 35 project plan conforms with all relevant State and local ordinances, plans, and codes, thus, no changes to the existing regulations are proposed or needed. The City has requested that the Wisconsin Department of Commerce amend the Janesville Community Development Zone boundary to include the land within TIF No. 35. This allows companies that locate within the amended TIF No. 35 boundary to apply for State of Wisconsin income tax credits under the Development Zone Program. LIST OF ESTIMATED NON-PROJECT COSTS IX. All of the public improvements and other project costs included in this project plan are TIF eligible costs as defined in Wisconsin Statutes ss. 66.1105, the Tax Increment District Law. Where an improvement can serve an area larger than the TIF district, the cost of the improvement will be prorated so that only the proportion of the costs to serve TIF No. 35 will be included as a project cost. That portion of the total costs which serves areas outside the TIF district will be considered 'non-project' costs and charged to funding sources other than TIF No. 35. METHODS FOR RELOCATION OF DISPLACED PERSONS X. The TIF No. 35 Project Plan does plan land acquisition, thus, there may be displacement of persons or business needing relocation assistance. For any reason, should relocation be necessitated by the City's involvement in the implementation of this Project Plan, it will be undertaken pursuant to Wisconsin Statutes Section 32.19 and 33.195, and according to a Relocation Plan, as approved by the Wisconsin Department of Commerce. PROMOTION OF THE ORDERLY DEVELOPMENT OF THE CITY XI. The creation of TIF No. 35 and the implementation of the projects in the TIF Project Plan will promote the orderly development of the City of Janesville by encouraging that new industrial development occurs in areas of the City planned for industrial growth. By creating well designed and strategically located industrial parks, land use conflicts and infrastructure deficiencies can be avoided. By providing financial incentives to stimulate private development projects, the City is able to ensure that economic growth continues to occur, thus offsetting the inevitable loss of jobs and incomes when economic conditions force the closure of other employers in the community. By utilizing the provisions of the Tax Increment Finance Law, the City can increase property values through development projects that result in increased tax base. TIF No. 35 continues the industrial development on the City’s southeast side that began with the creation of TIF No. 5 in 1988 and TIF No. 16 in 1996 and TIF No. 22 in 1999. TIF No. 35 will add to the tax and employment base of the community, and will generate positive secondary impacts in the community through increased local disposable incomes. Resolution No. 2012-875 RESOLUTION APPROVING AMENDMENT NO. 1 TO THE PROJECT PLAN FOR TAX INCREMENT FINANCE DISTRICT NO. 35 WITHIN THE CITY OF JANESVILLE, ROCK COUNTY, WISCONSIN WHEREAS, the Common Council of the City of Janesville adopted Resolution No. 2011-816 on August 22, 2011, creating the City of Janesville Tax Increment Finance District No. 35 in accordance with the provisions of Wisconsin Statutes Section 66.1105; and WHEREAS, the City of Janesville Administration is now proposing Amendment No. 1 to the Project Plan for TIF No. 35 revising the project budget and amending the TIF No. 35 boundary to include an additional 84 acres of industrial land; and WHEREAS, the Janesville Plan Commission has held a public hearing on proposed Amendment No. 1 to the Project Plan of Tax Increment District No. 35 and the proposed new boundaries of the Amended TIF district on the 6 day of February, 2012, and found both proposed amendments to be acceptable and consistent with the long range plans of the City and its best interests; and WHEREAS, the Chief Executive Office of the Janesville School District, Rock County Board, Blackhawk Technical College, and other entities having the power to levy taxes upon the property located within the proposed Tax Increment District No. 35 have been notified of the proposed Amendment to the Project Plan for TIF No. 35, pursuant to Section 66.1105 (4)(a) and (e), Wisconsin State Statutes; and WHEREAS, Tax Increment Finance District No. 35, as amended, is declared to be an “industrial TIF district”, where more than 51% of the land is currently zoned M-1 Industrial and has been found suitable for industrial development within the meaning of Section 66.1101, Wisconsin State Statutes, and will remain zoned for industrial purposes for the life of the TIF District; and WHEREAS, the project costs directly serve to promote industrial development, consistent with the purpose for which the TIF District was created, and the improvement of the proposed additional areas for industrial projects will significantly enhance the value of all property within the City of Janesville; and WHEREAS, the equalized value of taxable property within the amended boundaries of TIF No. 35 plus the value increment of all existing Janesville TIF Districts does not exceed twelve percent (12%) of the total equalized value of property within the City of Janesville; and WHEREAS, the amended Project Plan for Tax Increment District No. 35 is economically feasible and in conformity and has been found to be in accordance with the City’s Resolution No. 2012-875 TIF 35 Amendment No. 1 Page 2 General Development Plans, Zoning Ordinance, and other relevant policies; and that implementation of the improvements as set forth in the Amended TIF No. 35 Project Plan is in the best interest of the City of Janesville and for the benefit of its residents and taxpayers. NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of Janesville that they hereby approve Amendment No. 1 to the Project Plan for City of Janesville Tax Increment Finance District No. 35, and refer Amendment No. 1 to a Joint Review Board for review and approval according to Wisconsin Statutes. ADOPTED: Motion by: Second by: APPROVED: Councilmember Aye Nay Pass Absent Dongarra-Adams Liebert Eric J. Levitt, City Manager McDonald Rashkin ATTEST: Steeber Voskuil Jean Ann Wulf, City Clerk-Treasurer APPROVED AS TO FORM: Wald Klimczyk, City Attorney Proposed by: City Manager Prepared by: Community Development ùóèãûèèíêî÷ãªéíööóù÷ï÷ïíêûîøçï òÛÎÇÛÊÃ ï÷ïíêûîøçï èíæÓÙõÊÛÉÉÏÛÎ÷ÙÍÎÍÏÓÙø×Æ×ÐÍÌÏ×ÎÈøÓÊ×ÙÈÍÊ öêíïåÛÐØñÐÓÏÙÂÃÑùÓÈÃûÈÈÍÊÎ×Ã ê÷ð×ÕÛÐíÌÓÎÓÍÎ¦ûÏ×ÎØÏ×ÎÈîÍÈÍèóöîÍ ìÊÍÒ×ÙÈ ìÐÛÎ é×Ù ÖåÓÉéÈÛÈÉÍÖÈÔ×èÛÄóÎÙÊ×Ï×ÎÈ öÓÎÛÎÙÓÎÕðÛÅÏÛÎØÛÈ×ÉÈÔÛÈÈÔ×ÌÊÍÒ×ÙÈÌÐÛÎÖÍÊÛÌÊÍÌÍÉ×ØÈÛÄ ÓÎÙÊ×Ï×ÎÈÖÓÎÛÎÙÓÎÕØÓÉÈÊÓÙÈÓÎÙÐÇØ×ÛÎÍÌÓÎÓÍÎÍÖÈÔ×ÙÓÈÃ ÛÈÈÍÊÎ×ÃÍÊÛÎÛÈÈÍÊÎ×ÃÊ×ÈÛÓÎ×ØÚÃÈÔ×ÙÓÈÃÛØÆÓÉÓÎÕÅÔ×ÈÔ×ÊÈÔ× ÌÐÛÎÓÉÙÍÏÌÐ×È×ÛÎØÙÍÏÌÐÓ×ÉÅÓÈÔÈÔÓÉÉ×ÙÈÓÍÎ¨ãÍÇÔÛÆ×ÛÉÑ×Ø Ï×ÈÍÊ×ÆÓ×ÅÛÙ×ÊÈÛÓÎÌÊÍÌÍÉ×Ø©ûÏ×ÎØÏ×ÎÈîÍÈÍÈÔ×èÛÄ óÎÙÊ×Ï×ÎÈÛÐöÓÎÛÎÙ×øÓÉÈÊÓÙÈîÍ ìÊÍÒ×ÙÈìÐÛÎ¨ØÛÈ×Øö×ÚÊÇÛÊÃ ÛÎØØ×È×ÊÏÓÎ×ÓÖÓÎÏÃÍÌÓÎÓÍÎÓÈÓÉÙÍÏÌÐ×È×ÛÎØ ÙÍÏÌÐÓ×ÉÅÓÈÔÈÔ×Ê×ËÇÓÊ×Ï×ÎÈÉÍÖåÓÉÙÍÎÉÓÎÉèóöðÛÅèÔÓÉ Ï×ÏÍÊÛÎØÇÏÙÍÎÉÈÓÈÇÈ×ÉÏÃÐ×ÕÛÐÍÌÓÎÓÍÎ é×Ù ÖåÓÉéÈÛÈÉÉ×ÈÉÖÍÊÈÔÈÔÍÉ×ÙÍÏÌÍÎ×ÎÈÉ ÍÖÛèóöÌÊÍÒ×ÙÈÌÐÛÎÅÔÓÙÔÛÊ×Ê×ËÇÓÊ×ØÚÃÉÈÛÈ×ÐÛÅèÔ×ÃÛÊ× ÛÉÖÍÐÐÍÅÉ ûÉÈÛÈ×Ï×ÎÈÐÓÉÈÓÎÕÈÔ×ÑÓÎØÎÇÏÚ×ÊÛÎØÐÍÙÛÈÓÍÎÍÖÛÐÐ ÌÊÍÌÍÉ×ØÌÇÚÐÓÙÅÍÊÑÉÍÊÓÏÌÊÍÆ×Ï×ÎÈÉÅÓÈÔÓÎÈÔ×ØÓÉÈÊÓÙÈÍÊÈÍ ÈÔ××ÄÈ×ÎÈÌÊÍÆÓØ×ØÓÎé×ÙÈÓÍÎ ÖÑåÓÉéÈÛÈÉ ÍÇÈÉÓØ×ÈÔ×ØÓÉÈÊÓÙÈ ûÎ×ÙÍÎÍÏÓÙÖ×ÛÉÓÚÓÐÓÈÃÉÈÇØÃ ûØ×ÈÛÓÐ×ØÐÓÉÈÍÖ×ÉÈÓÏÛÈ×ØÌÊÍÒ×ÙÈÙÍÉÈÉ ûØ×ÉÙÊÓÌÈÓÍÎÍÖÈÔ×Ï×ÈÔÍØÉÍÖÖÓÎÛÎÙÓÎÕÛÐÐÍÖÈÔ× ×ÉÈÓÏÛÈ×ØÌÊÍÒ×ÙÈ×ØÙÍÉÈÉ èÔ×ÈÓÏ×ÅÔ×ÎÈÔ×ÙÍÉÈÉÍÊÏÍÎ×ÈÛÊÃÍÚÐÓÕÛÈÓÍÎÉÊ×ÐÛÈ×Ø ÈÔ×Ê×ÈÍÛÊ×ÈÍÚ×ÓÎÙÇÊÊ×Ø ûÏÛÌÉÔÍÅÓÎÕÈÔ××ÄÓÉÈÓÎÕÇÉ×ÉÛÎØÙÍÎØÓÈÓÍÎÉÍÖÈÔ× Ê×ÛÐÌÊÍÌ×ÊÈÃÓÎÈÔ×ØÓÉÈÊÓÙÈ ûÏÛÌÉÔÍÅÓÎÕÈÔ×ÌÊÍÌÍÉ×ØÓÏÌÊÍÆ×Ï×ÎÈÉÛÎØÇÉ×ÉÓÎÈÔ× ØÓÉÈÊÓÙÈ ìÊÍÌÍÉ×ØÙÔÛÎÕ×ÉÍÖ ÛâÍÎÓÎÕÍÊØÓÎÛÎÙ×É ÚèÔ×ÏÛÉÈ×ÊÌÐÛÎÓÖÛÎÃ ÙèÔ×ÏÛÉÈ×ÊÏÛÌÓÖÛÎÃ ØúÇÓÐØÓÎÕÙÍØ×É ×ùÓÈÃÍÊØÓÎÛÎÙ×É ûÐÓÉÈÍÖ×ÉÈÓÏÛÈ×ØÎÍÎÌÊÍÒ×ÙÈÙÍÉÈÉ ûÉÈÛÈ×Ï×ÎÈÍÖÌÊÍÌÍÉ×ØÏ×ÈÔÍØÉÖÍÊÈÔ×Ê×ÐÍÙÛÈÓÍÎÍÖÛÎÃ Ì×ÊÉÍÎÉÈÍÚ×ØÓÉÌÐÛÙ×ØÛÎØ ôÍÅÈÔ×èÛÄóÎÙÊ×Ï×ÎÈöÓÎÛÎÙÓÎÕøÓÉÈÊÓÙÈÌÊÍÏÍÈ×ÉÈÔ× ÍÊØ×ÊÐÃØ×Æ×ÐÍÌÏ×ÎÈÍÖÈÔ×ùÓÈÃ óÔÛÆ×Ê×ÆÓ×Å×ØÌÊÍÌÍÉ×Ø©ûÏ×ÎØÏ×ÎÈîÍÈÍèÛÄóÎÙÊ×Ï×ÎÈÛÐ öÓÎÛÎÙ×øÓÉÈÊÓÙÈîÍ ìÊÍÒ×ÙÈìÐÛÎ¨ØÛÈ×Øö×ÚÊÇÛÊÃ ÖÍÊ èÛÄóÎÙÊ×Ï×ÎÈöÓÎÛÎÙ×èóöøÓÉÈÊÓÙÈîÇÏÚ×Ê ÌÊ×ÌÛÊ×ØÚÃÈÔ× ùÓÈÃÍÖòÛÎ×ÉÆÓÐÐ×÷ÙÍÎÍÏÓÙø×Æ×ÐÍÌÏ×ÎÈûÕ×ÎÙÃöÓÎÛÎÙ×øÓÆÓÉÓÍÎ ÛÎØùÓÈÃïÛÎÛÕ×ÊªÉíÖÖÓÙ×óÈÓÉÏÃÐ×ÕÛÐÍÌÓÎÓÍÎÈÔÛÈÉÛÓØ ÌÊÍÒ×ÙÈÌÐÛÎÛÉÌÊ×ÌÛÊ×ØÚÃÈÔ×÷ÙÍÎÍÏÓÙø×Æ×ÐÍÌÏ×ÎÈûÕ×ÎÙÃÓÉ ÙÍÏÌÐ×È×ÛÎØØÍ×ÉÙÍÏÌÐÃÅÓÈÔé×ÙÈÓÍÎ ÖåÓÉéÈÛÈÉ ûÙÙÍÊØÓÎÕÈÍÈÔ×È×ÊÏÉÍÖÈÔ×ÛÚÍÆ×ÙÓÈ×ØÉÈÛÈÇÈ×ÈÔÓÉÐ×ÕÛÐ ÍÌÓÎÓÍÎÉÔÍÇÐØÎÍÅÚ×ÙÍÏ×ÈÔ×ÖÓÎÛÐÙÍÏÌÍÎ×ÎÈÍÖÈÔÛÈÌÊÍÒ×ÙÈÌÐÛÎ ÛÏ×ÎØÏ×ÎÈ åÛÐØñÐÓÏÙÂÃÑ ùÓÈÃûÈÈÍÊÎ×Ã ÅÑ ÙÙò×ÛÎûÎÎåÇÐÖùÓÈÃùÐ×ÊÑèÊ×ÛÉÇÊ×Ê òàûÈÈÍÊÎ×ÃàåÍÊØàéÔÛÊ×Øàèóö ûÏ×ÎØð×ÕÛÐíÌÓÎÓÍÎØÍÙÄ Economic Development Department Memorandum February 13, 2012 TO: City Council FROM: Vic Grassman, Economic Development Director SUBJECT: Action on a Proposed Resolution Authorizing the City Manager to enter into a T.I.F. Development Agreement with SHINE Medical Technologies (File Res 2012-882) Executive Summary SHINE Medical Technologies, located at 2555 Industrial Drive, Monona, WI 53713, has committed to the relocation of its headquarters and the development of a production facility at 4021 US Highway 51 S. located in Rock Township, Rock County. This is contingent on the successful completion of the land purchase, annexation, amendment of TIF 35 to include the new site, and approval of the Developers Agreement between the City and SHINE. This proposed project is in response to a worldwide shortage of Moly-99 which has and will continue to impact diagnostic testing in the United States. Moly-99 has a half-life of 66 hours. Right now there are no producers of this isotope in the United States, thus doses need to be flown in from Canada, Europe and South Africa. The additional travel time further degrades the quality as well as increases the cost. This growing shortage is why the U.S. Dept. of Energy has awarded the company one of four $25.0 million matching grants. The SHINE team includes partnerships with Los Alamos, Argonne Labs, UW-Madison, the Morgridge Institute, the State of Wisconsin and Alliant Energies. SHINE Medical Technologies plans on producing the isotope most commonly known as Moly-99, which is the precursor of technetium-99. This isotope is widely used in over 30 of the most common medical diagnostic procedures proscribed throughout the United States and the world. The most commonly known diagnostic test is a “stress test” to determine possible cardiac ailments. It is estimated that over 40,000 diagnostic procedures are performed daily in the United States and over 40 million worldwide annually. The world market is estimated at over $1.0 billion annually. SHINE is obtaining matching funds, and after meeting the prerequisite technology and environmental requirements, expects to begin construction in 2013-2014 with production projected to begin in 2015. However, based on the uncertainty of the regulatory review process it would be reasonable to see delays in the projected start date for production.. The City’s tax estimates are based on receiving a tax payment of $614,655 beginning in 2017. The company will construct a production facility with a projected assessed value of $25.0 million for the term of the incentive agreement. This project will create a minimum of 125 jobs at an estimated average salary of $60,000/yr within five (5) years of the completion of the facility.. City Manager’s Recommendation The City Administration has negotiated the Development Agreement with SHINE Medical Technologies consistent with the parameters established by the City Council. The intent of my recommendation since the Council established the parameters will be first to outline key components contained within the development agreement followed by a summary of the City Manager office’s risk assessment of the project. Key Elements of the Development Agreement  SHINE Medical Technologies will build a facility with an assessed value of $25 million and, once the building is constructed, they will guarantee an annual payment of approximately $583,000 for the term of the agreement.  SHINE Medical Technologies will build an approximately 35,000 square foot building  SHINE Medical Technologies will guarantee 125 jobs within 5 years of initiating production.  The City’s incentive package includes the following: The City will convey 84 acres of land valued at approximately $1.53 o million. The City will extend utilities valued at approximately $345,000 for o the proportional value to SHINE Medical Technologies. TIF 35 will pay the $578,000 stormwater assessment as a o forgivable loan. This can be accessed as cash, but SHINE Medical would be then be required to pay the stormwater assessment. The City will make a forgivable loan of $1.5 million to SHINE for site o development and/or equipment. This would be forgiven if certain employment and tax payment conditions are met. The City would guarantee a private loan to SHINE of up to $4 o million.  The City’s incentive package will be conditioned upon certain benchmarks being met for various incentives. The benchmarks include: The Morgridge Institute for Research (MIR) receiving notice of o phase 1B award from the NNSA. The accelerator reliability test being successful. o MIR’s notice of a phase II award from the NNSA o The NRC issuing a construction permit. o Issuance of a building permit by the City of Janesville. o SHINE Medical Technologies providing a plan for removal of the o by-product material as defined by the NRC within a 5 year period or shorter and an approved storage plan. These plans must be approved by a third party. In addition, to the benchmarks, the City will require certain o mortgages and/or liens on equipment as security.  This agreement has associated positive outcomes and risks associated with the agreement:  Expected positive outcomes include: Creation of 125 jobs o Increase in real property tax assessed value of approximately $25 o million. (This will depreciate over time) This creates over $550,000 annually in tax increment. Potential for expansion by SHINE into other areas. o Taking advantage of the area’s advanced manufacturing talent. o Has potential to attract interest from other high-tech medical o industries.  Risks associated with the development agreement SHINE Medical Technologies will have to meet certain Federal o regulatory requirements prior to initiating construction. These timelines are undetermined and could delay the realization of the above benefits. (The majority of the City’s direct financial incentives will not be expended until these are met) There are environmental concerns with the process. The company o is in the early stages of the NEPA process and therefore SHINE has not yet developed a plan to address these concerns. (This will occur, but has not occurred yet.) (The City Manager anticipates hiring an outside consultant to advise the City through the process although the agreement only provides narrow discretion for the City in the future.) The four companies that have received DOE funding, including o SHINE Medical Technologies, have not proven that their processes can work on a large scale. Our benchmarks do not (in the opinion of the City Manager) provide the City protection that the technology will be proven on a production scale prior to distribution of our funds or prior to the facility being completed. The loan guarantee provides an added risk to the City. o The challenges facing the company that could put a portion of the o City’s funding at risk include economics of the project; Federal regulatory process; competition, including subsidies, from other countries which are part of economics; and providing a plan to manage any environmental issues. Economic Development Director’s Recommendation: The Economic Development Director recommends Council adopt Resolution No. 2012-882 approving the Developers Agreement with SHINE Medical Technologies. The Director recognizes that due to the potential technical and environmental risks inherent in this business start-up, this is a non-traditional TIF project but this also a unique economic development opportunity for the City. Recognizing the above, my responsibility is to evaluate this project from an economic development perspective and seek answers to the following questions.  Will the project increase the wealth in our area?  Are the wage levels above average for the community?  Will it raise the “development bar” for the community?  Have the financial risks been reduced to an appropriate level relative to the City’s involvement in the types of incentives offered and timing of these incentives? In my opinion, the answer to these questions is “yes”. This recommendation is based on the following: Direct Economic Benefits:  SHINE has committed to guarantee a tax equivalent payment based on a minimum of a $25.0 million assessed value on the production facility for the term of the Developers Agreement. The minimum tax payment will be $583,282. Assuming construction is completed and the full value of the facility hits the 2017 tax roll the City’s investment (using TIF dollars) of $4,974,286 will be recovered in year 14 of the project. This is based on the first year of the initial investment. Note: This break-even projection does not include recovery of the $4.0 million private sector TIF loan guarantee in the event this project is not successful.  Once the project is in production, people have been hired etc.; there will be an economic multiplier relative to the purchase of goods and services within the Janesville economy. A reasonable but conservative multiplier would be 2.0 to 2.5 times for new dollars coming from outside Janesville which are then spent locally.  Specific benchmarks must be achieved before funds are expended thus significantly reducing both technological as well as environmental risk of the project not moving forward. This will include approval by the federal Nuclear Regulatory Commission that the company has demonstrated that it has met all requirements including plans for technical contingencies, waste storage and transportation. It is also important to note that a significant portion of the incentive (excluding the $4.0 million loan guarantee) will be used for traditional TIF investment purposes i.e. infrastructure extensions, site development costs and land purchase. Excluding the land purchase, these funds will not be distributed until actual construction of the production facility is authorized (permitted) at the federal and local levels and the start of construction is imminent. Thus technological and environmental risks will have been significantly reduced. The Council voted to move forward with the land purchase in December 2011 to be closed by the end of February 2012. This purchase is not contingent upon SHINE locating on the site. Should this project not move forward, the site will be zoned M1 and used for future industrial development opportunities. Indirect Economic Benefits:  Due to the national and worldwide medical benefits resulting from the production of these isotopes extensive media coverage of this is expected. From a business attraction perspective, positive media coverage will potentially influence site selectors and other business decision makers. In my experience, the outside business world views Janesville as either the community that lost GM or not at all. Recognizing that the Dept. of Energy has only given out four of these $25 million grants to U.S. companies and two are located in Rock County, I would expect significant coverage from business papers and periodicals as well as science publications. Since reading third-party accounts is a major influence for many business location decision makers, this would certainly improve Janesville’s perception in the economic development/site location world. Along with our certified “shovel ready” site, (1 of 2 in Wisconsin) expedited permitting and incentive programs, Janesville would be well positioned for future growth  The positive impact on our local citizens. Janesville is known for its advance manufacturing capabilities and this project would take us to the top of that curve. Local residents can be trained and have access to these jobs with the corresponding salaries. The vast majority of the jobs created will only require technical training. Conversations have already started between SHINE and Blackhawk Technical College on developing a specific training program to meet the company’s future needs. Background Of all the isotopes used in medical diagnostics, none plays a more pivotal role than technetium – 99. Each day, hospitals and clinics around the world perform over 60,000 of diagnostic procedures which can illuminate tumors and heart problems, 80% of which use this isotope. Trouble is Technetium – 99 has a very short half life of 6 hours. Moly-99 which has a half life of 66 hours is used as feedstock to allow this isotope to extend its half life, thus improving the quality of the diagnostic images etc. People’s lives depend on the quality of this isotope during the imaging process. Currently there are no commercial producers of these isotopes in the United States and those producers in Canada, Europe and South Africa have aging nuclear reactors that are subject to breakdowns and repairs. The average age of these facilities is 46 years. This creates, now and in the future, a world health problem. Due to the current state of the industry many hospitals have a difficult time in obtaining the isotope for diagnostic tests and if available, due to the half- life issue, the quality can potentially decline. The magnitude of this issue has prompted the U.S. Department of Energy (DOE) to award four $25 million grants to encourage the development of U.S. based, commercially viable, production processes of moly-99. SHINE Medical Technologies was selected as one of these recipients in September 2010. NorthStar located in Beloit was also a successful recipient of this type of grant. SHINE expects to be in production by 2015 with its goal to produce 50% of the U.S. supply. With such collaboration partners as UW-Madison, the Morgridge Institute for Research, Los Alamos and Argonne Labs, SHINE has raised a significant level of venture capital as well as financial support from the Wisconsin Economic Development Corp., Alliant Energies and others. cc: Eric Levitt Jacob Winzenz Resolution No. 2012 - 882 A Resolution Approving a TIF District 35 Development, Land Sale, and Loan Agreement With SHINE MEDICAL TECHNOLOGIES, INC. WHEREAS, the Common Council of the City of Janesville shall create Tax Incremental Finance District No. 35 in accord with Wisconsin’s Tax Increment Financing Laws, Wis. Stats. Sec. 66.1105 and other applicable statutes, as from time to time amended or renumbered, in order to stimulate the development and redevelopment of industrially zoned properties; retain and increase employment; construct, renovate and expand industrial facilities; and otherwise provide for the overall economic health, welfare, vitality, and good of the community; and WHEREAS, the Project Plan for Janesville TIF District No. 35 includes industrial and manufacturing development and redevelopment, improvements, facility construction, expansion, and renovation, job retention and creation, and related financing, incentives, payments, loans, and actions that effectuate and/or facilitate these legitimate and pressing public purposes and goals; and WHEREAS, Shine Medical Technologies, Inc. (SHINE”) is a Wisconsin domestic corporation currently conducting its principal business at 2555 Industrial Drive., City of Monona, County of Dane, State of Wisconsin 53713, and shall be the OWNER and DEVELOPER of a manufacturing center (“FACILITY”) to be constructed by SHINE upon an approximately Eighty Four (84) acre parcel of real property to be located at 4021 U.S. Highway 51 S., City of Janesville, County of Rock, State of Wisconsin 53546 (“PROPERTY”); and WHEREAS, SHINE shall conduct its principal business at the FACILITY upon the PROPERTY; and the City shall attach and incorporate the entire site into its municipal corporate boundaries and jurisdiction, amend the boundaries of an existing Tax Incremental Financial District (T.I.F. District No. 35) to include the PROPERTY, amend the TIF District No. 35 Project Plan if necessary, and then eventually sell and convey the PROPERTY to SHINE for the construction and operation of the FACILITY, assessed value addition, new job creation and maintenance, and related economic and industrial development purposes as set forth in a certain executed and binding T.I.F. DEVELOPMENT AGREEMENT FOR NEW INDUSTRIAL BUILDING CONSTRUCTION LOCATED PRIMARILY IN JANESVILLE PROPOSED T.I.F. DISTRICT NO. 35 FOR DEVELOPMENT PURPOSES BY AND BETWEEN THE CITY OF JANESVILLE ("THE CITY") AND SHINE MEDICAL TECHNOLOGIES, INC. (“SHINE”) (the "AGREEMENT"), the terms, provisions, and promises of which AGREEMENT are reiterated and incorporated herein by reference as if fully set forth verbatim; and WHEREAS, SHINE intends, promises to, and shall construct and operate an approximately Thirty Five Thousand square foot (35,000 sq. ft.) high technology manufacturing and production FACILITY upon this PROPERTY, which PROPERTY and FACILITY at all times during this AGREEMENT shall have a combined real and personal property tax assessed value in an amount of not less than Twenty Five Million and 00/100 Dollars ($25,000,000); and create and maintain the new full-time employment equivalent positions of employment at the FACILITY in the manner, time, kind, and number set forth in, and during the entire term of, the AGREEMENT; and WHEREAS, there are currently sufficient positive fund balances in the TIF District No. 35 improvement and overall project accounts, and these expenditures fall within the allowable time and scope for said Development Agreement and expenditures; and WHEREAS, the Common Council hereby find that the City Administration has negotiated the AGREEMENT with SHINE upon terms, conditions, promises, obligations, provisions, and purposes, consistent with the best interest of and benefit to the City, all applicable laws, and Common Council industrial and economic development policies, goals, objectives, and directives. NOW, THEREFORE, BE IT RESOLVED, by the Common Council of the City of Janesville that: 1. Each and every of the above recitals are reiterated and incorporated herein by reference as if fully set forth verbatim; and 2. The above described AGREEMENT and proposed City land transactions, incentives, loans, guarantees, purposes, industrial development, and promises are each hereby authorized, ratified, and approved; and 3. All expenditures, terms, conditions, promises, obligations, and provisions set forth in the AGREEMENT are hereby found to be in the best interest of, and for the benefit of, the CITY, its residents, businesses, and taxpayers; and 4. The City Manager and/or his designee(s) is/are hereby authorized to execute, enter into, and effectuate the terms, provisions, and promises set forth in the AGREEMENT on behalf of the City of Janesville; and BE IT FURTHER RESOLVED, that the City Manager and/or his designee(s), on behalf of the City of Janesville, is/are hereby authorized to further administratively negotiate, draft, execute, review, enter in, modify, amend, record, file, and otherwise effectuate the above described AGREEMENT and to take, make, and/or enter into any and all actions, and related amendments, agreements, promissory notes, contracts, documents, papers, obligations, and promises that the City Manager and/or his designee(s) may, from time to time and at any time, determine necessary and/or desirable to effectuate the AGREEMENT and/or the intent and purposes of this Resolution. ADOPTED: Motion by: Second by: APPROVED: Councilmember Aye Nay Pass Absent Dongarra-Adams Liebert Eric J. Levitt, City Manager McDonald Rashkin ATTEST: Steeber Voskuil Jean Ann Wulf, City Clerk-Treasurer APPROVED AS TO FORM: Wald Klimczyk, City Attorney Proposed by: Economic Development Director Prepared by: City Attorney T.I.F. DEVELOPMENT AGREEMENT FOR NEW INDUSTRIAL BUILDING CONSTRUCTION LOCATED PRIMARILY IN JANESVILLE PROPOSED T.I.F. DISTRICT NO. 35 FOR DEVELOPMENT PURPOSES BY AND BETWEEN CITY OF JANESVILLE "THE CITY" AND SHINE MEDICAL TECHNOLOGIES, INC. (The "AGREEMENT") DRAFT 06 February 2012 ÜÎßÚÌ TIF DEVELOPMENT AGREEMENT I. PARTIES CITY OF JANESVILLE A.The is a Wisconsin Municipal Corporation located in the County of Rock, conducting its principal business at 18 North Jackson Street, Janesville, WI 53547- CITYSELLER 5005 (hereinafter the ""), and is the of certain real property and maker of certain loans and incentives described below; SHINE MEDICAL TECHNOLOGIES, INC.,(SHINE, B. is a Wisconsin domestic corporation currently located and conducting its principal business at 2555 Industrial Drive, City of Monona, County of Dane, State of Wisconsin 53713, and shall be the ownerand developerof a manufacturing center and related infrastructure and property FACILITY 4021 U.S. Highway 51 S., City of Janesville, County of Rock, State of Wisconsin 53546 PROPERTY. SHINE shall conduct its principal business pertaining to this AGREEMENTPROPERTYPROPERTY at the . The is currently located in the Town of Rock CITY but theintends to annex this approximately Eighty Four (84) acre parcel of land, attach and incorporate the entire site into its Municipal corporate boundaries and jurisdiction, amend the PROPERTYPROPERTYSHINE , and then sell and convey the to for the construction and FACILITY operation of the and related economic and industrial development purposes more fully . described and discussed below SHINE FACILITYPROPERTY C.intends to develop and operate the upon the and construct an approximately Thirty Five Thousand square foot (35,000 sq. ft.) production FACILITYPROPERTY, PROPERTY FACILITY upon this whichandat all times during this AGREEMENT shall have a combined real and personal property tax assessed value in an amount FACILITY of Twenty Five Million and 00/100 Dollars ($25,000,000). The actual size of the is SHINE subject to final approved building plans. promises to and shall create, achieve, and FACILITY successfully provide and maintain not less than the minimum employment levels at the AGREEMENT as set forth and promised below inthis . CITY D.To these legitimate and beneficial purposes and uses,theshall make and/or SHINE, SHINE CITY loan to , as applicableandshall receive and/or borrow from the , as SHINE applicable, loans and incentives in the various ways set forth herein shall repay in full to the CITY four (4) of a five (5) part incentive package: ÜÎßÚÌ ðê Ú»¾ îðïî Page 2 of 32 1.Part One shall be in the amount of Five Hundred Seventy Eight Thousand and 00/100 Dollars ($578,000) and shall be a stand-alone forgivable direct loan CITY SHINE to that shall be SHINE CITY repayable by to the over a period of ten (10) years commencing CITYSHINE one (1) year after the issues a final certificate of occupancy to for FACILITY the . This shall be a zero percent (0%) loan. For each year that SHINECITY creates and maintains in the the minimum new full-time th employment described more fully below, one tenth (1/10) of the Storm Water CITY Forgivable Loan shall be forgiven by the . See Exhibit C. At the option of SHINE, this Storm Water Forgivable Loan may either be used to pay the land division assessment for storm water purposes, currently estimated at $578,000, OR FACILITY it may be used for construction of the and/or acquisition of SHINE machinery, fixtures or equipment.If elects to use the Storm Water FACILITY Forgivable Loan for construction of the and/or acquisition of , SHINE CITY equipmentthen will be required to and shall pay to the in a lump sum the entire amount of the land division assessment for storm water purposes FACILITY at the time land division occurs or when construction of the SHINECITY commences, whichever occurs first. Furthermore, shall grant the a security interest in such equipment until the City has received the Property Break-Even Amount as provided in Section IV. O.7 of the Agreement and all CITY guarantees of the Guaranteed Loans have been repaid in full and have terminated. 2.Part Two shall be a One Million Five Hundred Thousand and 00/100 Dollar CITY SHINE ($1,500,000) stand-alone forgivable direct loan from the to SHINE CITY to the over a period of ten (10) years commencing one (1) year CITYSHINE after the issues a final certificate of occupancy to for the FACILITY SHINE . This shall be a zero percent (0%) loan.may use proceeds FACILITY of this loan only for construction of the and/or acquisition of FACILITY Equipment.If any portion of the loan is usedfor construction of the , PROPERTY and FACILITYCITY described in Section IV. C., and will enter such agreements SHINE with as may be ÜÎßÚÌ ðê Ú»¾ îðïî Page 3 of 32 CITY necessary to subordinate the Lender(s). If any portion of the Property Site Development Forgivable Loan is FACILITY used to purchase machinery, fixtures or equipment to be used in the SHINECITY , shall grant the a first priority security interest in the Equipment, which security interest shall terminate when the City has received the Property Break-Even Amount as provided in Section IV. O.7 of the CITY Agreement and all guarantees of the Guaranteed Loans have expired. The parties will enter a security agreement providing that such Equipment must SHINE remain in the sole ownership ofor its permitted successors and assigns, FACILITY and shall remain in the for ten years or the useful life of the Equipment, whichever occurs first. If the Equipment has a useful life of less than CITY ten years, the security agreement will provide the with additional CITY collateral to serve as security until the has received the Property Break- CITY Even Amount under this Agreement and any guarantees of Guaranteed SHINE Loans have been repaid in full or terminated. For each year that creates CITY and maintains in the the minimum new full-time employment described th more fully below, one tenth (1/10) of the Property Site Development Forgivable CITY Loan shall be forgiven by the . See Exhibit D. SHINE 3.Part Three shall be the sale and conveyance in fee simple to of PROPERTY an approximately eighty four (84) aggregate acre parcel of the valued at One Million Five Hundred Thirty One Thousand Eight Hundred Twenty Four and 00/100 Dollars ($1,531,824), repayable over a ten (10) year SHINECITY term, at 0% interest, to be repaid by to the under the tax, tax increment, and/or tax equivalent payment methods more fully described below, CITY commencing one (1) year after the issues a final certificate of occupancy SHINEFACILITY to for the . CITY 4.Part Four shall consist of the extending water and sanitary sewer PROPERTY at a current cost estimated at One Million Two Hundred Sixty Thousand and 00/100 Dollars ($1,260,000). Since these Water and Wastewater Utilities will be able to service the entirety of T.I.F. District No. 35 to be comprised of 308 acres, the cost attributable to the aggregate eighty four (84) acres that ultimately will be SHINE occupied by is Three Hundred Forty Three Thousand Six Hundred ÜÎßÚÌ ðê Ú»¾ îðïî Page 4 of 32 Thirty Six and 00/100 Dollars ($343,636). This amount shall be repaid by SHINECITY to the under the tax, tax increment, and/or tax equivalent payment CITY methodology set forth below, commencing one (1) year after the issues a SHINEFACILITY final certificate of occupancy to for the . CITY 5.Part Five of this incentive shall be a guarantee of private sector loan(s) to SHINE SHINE solely for construction of FACILITYCITY the and/or acquisition of Equipment. The providing this guarantee is to provide a credit enhancement for construction of FACILITYFACILITY the and/or acquisition of equipment to be used in the . CITY The guarantee shall be for an aggregate amount of principal and interest that is less than or equal to Four Million and 00/100 Dollars ($4,000,000) and shall expire no later than ten (10) years after the date that the guarantee is SHINE provided to SHINE As makes principal payments on the Guaranteed Loans, the amount of CITY the based on the amount of principal payments made compared to the total amount borrowed. It shall be the SHINE SHINE responsibility ofto secure the Guaranteed Loan(s). If obtains one or more Guaranteed Loan(s) and the aggregate amount of principal, interest SHINE and any other payments owed by for Guaranteed Loans exceeds CITY $4,000,000, the Guaranteed Loans that exceeds $4,000,000, and the amounts of the guarantees provided to the lenders must be alloca the guarantees does not exceed $4,000,000. Additionally, any lender providing CITY Guaranteed Loans must agree to notify the in the event of a default by SHINECITY and provide at least 30 days for the to cure such default. If a lender making a Guaranteed Loan declares such loan to be in default, such default is not cured, the lender requires that the Guaranteed Loan be paid in full, CITY and the is required to satisfy its obligations on its guarantee, the lender SHINE will assign any collateral rights it has to the assets of under the CITY Guaranteed Loan to the up to the amount of thesatisfaction of SHINECITY such obligations. must also agree to reimburse for any amounts CITYSHINE advanced by to below). ÜÎßÚÌ ðê Ú»¾ îðïî Page 5 of 32 CITYSHINE E.The overall Development Incentive Package to , not including the Four Million and 00/100 Dollars ($4,000,000) private loan guarantees, is intended to be in the amount of Four Million Nine Hundred Seventy Four Thousand Two Hundred Eighty Six and 00/100 Dollars ($4,974,286) comprised of and to be used solely for the land acquisition purchase price ($1,531,824), public utility costs ($343,636), storm water assessments or other purposes related to the Facility ($578,000), site development and equipment acquisition costs ($1,500,000), plus all Debt Service, Project, and Project Plan-related costs, fees, expenses, and disbursements by CITYAGREEMENT the provided in this (approximately $1,020,826). These amounts and SHINECITY incentives shall each be repaid by to the in the manner, amounts, and time(s) set SHINE forth herein. The incentives and loans shall act as the consideration. shall use the FACILITYPROPERTY loans, incentives, , and solely for these industrial site development . purposes II. DESCRIPTION OF THE PROPERTY PROPERTY CITY The shall be located at 4021 US Highway 51 S. in the , currently in the Town of Rock, County of Rock, State of Wisconsin, in major part previously owned by one Arthur SHINE T. Donaldson, but at the time of annexation and subsequent conveyance to shall be owned CITY in fee simple by the which currently holds and has recently exercised a certain Option to PROPERTYCITY Purchase to acquire the from the owner. The plans to and shall annex the CITY Eighty Four (84) acre parcel of real property currently located in the Town of Rock into the PROPERTY and amend the boundaries of existing T.I.F. District No. 35 to include the within SHINE . See Exhibit A,which is incorporated PROPERTY herein by reference as if fully set forth verbatim. This parcel constitutes the . The CITY will use reasonable efforts to work with the State of Wisconsin Department of Transportation PROPERTY to obtain the rights to appropriate direct access from the to a main road prior to PROPERTYSHINE SHINE conveyance of the to (with any construction costs to be borne by ), and to provide that such access will run with the land. III. PURPOSE OF AGREEMENT PROPERTY A.The described shall be located within City of Janesville T.I.F. District ÜÎßÚÌ ðê Ú»¾ îðïî Page 6 of 32 SHINE No. 35, and is intended to be used by solely as part of an overall economic and industrial CITY development project in the for the construction of an approximately Thirty Five Thousand FACILITY square foot (35,000 sq. ft.) with taxable assessed value for all times pertinent during AGREEMENT the term of this in an amount of at least Twenty Five Million and 00/100 Dollars FACILITY. ($25,000,000) which shall be attributed to and flow from the (See also Section IV. O. 12. below). This project will provide, foster, and encourage economic development; industrial development; additional employment opportunity; enhance the health, welfare, good, and benefit of CITYCITY and to the ; and add significantly to the best interests of the , its residents, taxpayers, and other businesses. SHINE B.To these legitimate ends and public purposes, hereby enters into this AGREEMENT CITY with the in order to construct for itself an estimated Thirty Five Thousand FACILITY CITY square feet (35,000 sq. ft.) consistent with such overall and particular plans and AGREEMENT requirements set forth in this , and in such manner as shall produce revenues to the CITYCITY through repayment of certain loans, loan incentives, other incentives, Debt Service, and related Project and Project Plan costs, fees, expenses from the improvements, increased equalized value of real and personal property, real and personal property tax payments, increased tax increment payments, and/or tax equivalency payments sufficient and required under this AGREEMENTCITY to repay those certain T.I.F. expenditures and related costs, fees, and AGREEMENT expenses within T.I.F. District No. 35 addressed in this . Said arrangement is to SHINE'sAGREEMENT benefit, as the T.I.F. taxation mechanism, terms of this , and related SHINE business factors and promises set forth herein evince. Both parties acknowledge that and CITYFACILITY the have agreed that the must and shall fully and timely meet the design CITYAGREEMENT standards of the in effect at the time that this is executed, which are attached and incorporated by reference hereto as Exhibit B. AGREEMENT C.By approving and entering into this , the governing body of the CITYAGREEMENT finds that the and project are each in the best interest of and benefit to the CITY . AGREEMENT D.The further purpose of this is to facilitate the construction and FACILITY PROPERTY operation of the upon the in the manner, time, nature, and kind set forth AGREEMENT in this and which shall create, retain, and maintain not less than the additional full- CITYSHINEAGREEMENT time and part-time jobs in the as set forth and promised by in this CITYSHINE (and any permitted successors or assigns of ) during the entire Term (as defined AGREEMENT, below) of this and any renewals and/or extensions hereof. This purpose shall ÜÎßÚÌ ðê Ú»¾ îðïî Page 7 of 32 CITY more than adequately meet and greatly facilitate the intent and goals of the and its land use, industrial development, economic development, Project Plan (as amended), and development plans for T.I.F. District No. 35, and related public benefit and welfare purposes. SHINECITY E. acknowledges that the is only able to reimburse certain development PROPERTY costs and/or to make certain incentives upon and/or for the benefit of the through the T.I.F. District No. 35 Project Plan and expenditures, as amended, pursuant to applicable Wisconsin CITY laws and statutes that enable the to receive and utilize specially designated and directed future real and personal property tax revenues, tax increments, and/or tax equivalency payments PROPERTY from the owner of the as generated by the taxable assessed real and personal property PROPERTY FACILITY value of and upon theand thereon, which increase the overall equalized CITY value of T.I.F. District No. 35. Further, by law, the must use such increased incremental tax revenues generated by such development project(s) located within T.I.F. District No. 35 to repay its T.I.F. District development costs, incentives, borrowings, debt service, and related Project and representations, and promised performance in the manner set forth herein, neither party would enter AGREEMENT into this . Each party relied and relies upon such representations, promises, and agreements of theother party. IV. THE AGREEMENT CITYSHINE A.Part One: Storm Water Forgivable Loan. The shall loan to , and SHINECITY, shall repay to the the amount of Five Hundred Seventy Eight Thousand and 00/100 CITYSHINE Dollars ($578,000) which shall be a stand-alone forgivable direct loan from the to SHINECITY that shall be repayable by to the over a period of ten (10) years commencing one (1) CITYSHINEFACILITY year after the issues a final certificate of occupancy to for the and shall carry an interest rate of zero percent (0%) per annum, the terms of which are set forth in attached SHINECITY Exhibit C. For each year that creates and maintains in the the minimum new full- th time employment described more fully below and in Exhibit C, one tenth (1/10) of the Storm CITY Water Forgivable Loan shall be forgiven by the . This loan is part of the incentive SHINESHINE package to and shall be outside of and in addition to, but may be repaid by to the CITY as part of, the below described tax, tax increment, tax equivalency, and/or other payment(s) SHINECITY. SHINE, from to the At the option of this Storm Water Forgivable Loan may either ÜÎßÚÌ ðê Ú»¾ îðïî Page 8 of 32 be used to pay the land division assessment for storm water purposes, currently estimated at OR FACILITY. $578,000, it may be used for construction of the and/or acquisition of equipment SHINE FACILITY If elects to use the Storm Water Forgivable Loan for construction of the and/or , SHINE acquisition of equipmentthen will be required to pay the land division assessment for FACILITY storm water purposes at the time land division occurs or when construction of the SHINE CITY commences, whichever occurs first. shall also be required to grant the a security interest on any equipment purchased with the monies until such time as the land division assessment CITYSHINE is fully paid or forgiven by the . The release and distribution to of the SHINECITY $578,000 loan proceeds shall occur within thirty (30) days after provides to the reasonable evidence of: (a) the Morgridge Institute for Research (MIR) notice of phase IB award accelerator reliability testing at Phoenix Nuclear Labs, LLC. CITY B. Part Two: Property Site Development Forgivable Loan. The shall loan to SHINESHINE CITY , and shall repay to the, the amount of One Million Five Hundred Thousand CITYSHINE and 00/100 Dollars ($1,500,000) as a stand-alone forgivable direct loan from the to SHINECITY that also shall be repaid by to the over a period of ten (10) years with 0% interest CITYSHINE commencing one (1) year after the issues a final certificate of occupancy to for the FACILITY. See attached Exhibit D, which is incorporated herein. If any portion of the Property Site Development Forgivable Loan is used to purchase Equipment, then the Equipment shall be SHINECITY used as security for that Loan until the Loan is fully paid by or forgiven by , whichever occurs earlier. While the Equipment is used as security for the Loan, it shall remain in SHINE the sole ownership ofor its permitted successors and assigns, and shall remain in the FACILITY for ten years or the useful life of the Equipment, whichever occurs first. If the Equipment has a useful life of less than ten years, the parties shall agree on alternate security for the SHINE remaining payments due on the Loan. For each year that creates and maintains in the th CITY the minimum new full-time employment described more fully below, one tenth (1/10) of CITY the Property Site Development Forgivable Loan shall be forgiven by the . This loan is part SHINE of the incentive package to and shall be outside of and in addition to, but may be SHINECITY repaid by to the as part of, the below described combined tax, tax increment, tax SHINECITY. equivalency, and/or other payment(s) from to the C. Part Three: This incentive is the sale and conveyance in fee simple to SHINE of the approximately Eighty Four (84) acres of industrial land (currently used for certain agricultural purposes) valued at One Million Five Hundred Thirty One Thousand Eight Hundred ÜÎßÚÌ ðê Ú»¾ îðïî Page 9 of 32 SHINECITY Twenty Four and 00/100 Dollars ($1,531,824) to be repaid by to the over a ten (10) year period, at 0% interest, under the tax, tax increment, and/or tax equivalent payment methods more fully described below. The conveyance document will include deed covenants providing SHINEPROPERTYCITY notice that must reconvey the to the if it does not begin construction SHINE on or before the Required Start Date (as defined below) or should abandon its efforts to construct the Facility prior to the Required Start Date, such reconveyance to be free and clear of any CITY liens other than the mortgage granted to the described below. These rights and obligations of SHINESHINE under this Agreement will run with the land. further agrees that it will grant to CITYPROPERTYCITY a mortgage on the , which the agrees will be subordinate only to any FACILITY, CITY for the and will enter such agreements with the Construction Lender(s) as may CITY CITY be necessary to subordinate the The mortgage granted to the at closing SHINESHINE will secure all of obligations to pay or repay the Tax Equivalency Payment, the Storm Water Forgiveable Loan, the CITY Property Site Development Loan and any monies advanced on guarantees of Guaranteed Loans. CITY D. Part Four shall consist of the incentive arising from the extending Water and PROPERTY Wastewater Utilities to the at a cost estimated at Three Hundred Forty Three Thousand Six Hundred Thirty Six and 00/100 Dollars ($343,636). This amount shall be repaid by SHINECITY to the under the tax, tax increment, and/or tax equivalent payment methodology set CITY forth below commencing one (1) year after the issues a final certificate of occupancy to SHINEFACILITY for the . CITY E. Part Five: This incentive shall be a guarantee of Guaranteed Loan(s) to be SHINESOLELY FACILITY spent and used by for construction of the and/or acquisition of SHINE). CITY Equipment. It shall be the responsibility of to secure the Guaranteed Loan(sThe guarantee or guarantees of Guaranteed Loans shall be limited to the lesser of (i) an aggregate amount of principal, interest and any other amounts due the lender that is less than or equal to Four CITY Million and 00/100 Dollars ($4,000,000) (in no event shall the be liable to pay more than $4,000,000 on such guarantee(s)) or (ii) a percentage of the amount due to a lender on the Guaranteed Loan(s), the numerator being $4 million, the denominator being the amount loaned to SHINESHINE pursuant to such Guaranteed Loan(s). If obtains Guaranteed Loans from more CITY than one lender, the CITYCITY the in no event exceed $4,000,000. The ÜÎßÚÌ ðê Ú»¾ îðïî Page 10 of 32 years after the closing of the Guaranteed Loan or December 31, 2024, whichever occurs earlier. The CITY lender of Guaranteed Loans must also agree with to (i) obtain a first priority collateral interest in the Facility or Equipment acquired with the proceeds of the Guaranteed Loans CITY requiring the to satisfy its obligations on the guarantee, or to assign all of its rights to that portion of the Collateral equaling the amount of the outstanding guarantee obligations at the time of CITYCITY the default to the upon the antee. SHINECITY hereby agrees to repay any amounts advanced on the guarantees of Guaranteed SHINE Loans. shall require that the lender(s) of each of these Guaranteed Loans shall, in the event SHINE CITY of default by on the loan(s): (a) provide the with written notice of default at the same SHINESHINE time as it provides such notice to ; and (b) provide with an opportunity to cure such default of not less than thirty (30) days, to the extent such default is curable. Such notice and cure SHINE provisions shall be in addition to all other default remedy options available to under the Guaranteed Loans. SHINE,CITY F. In conjunction with providing the above incentives to the will incur various borrowing costs, interest costs, interfund borrowing costs, debt service, and related SHINECITY Eight Hundred Twenty Six and 00/100 Dollars ($1,020,826) to be repaid by to the over a ten (10) year period, at 0% interest, under the tax, tax increment, and/or tax equivalent payment methods more fully described below. SHINE, G. The Property Site Development Forgivable Loan distributions to and the $4,000,000 aggregate principal and interest private loan guarantees are each further SHINE contingent and conditioned upon CITY issued a construction permit, (3) providing FACILITY with a plan for off-site storage of all - Section 11 the Atomic Energy Act, as revised, and as further defined by regulations issued by the FACILITYSHINE NRC) at a place so that on-site storage of such byproduct material by never exceeds the shorter of five (5) years OR such lesser time as is consistent with (a) reasonable cost of SHINE removal and (b) regulatory requirements, and has agreed to follow such plan; and (4) Issuance of a building permit by the City of Janesville, Department of Community and Economic FACILITY Development. The byproduct material. produced at and/or by the and/or upon the PROPERTYSHINE shall be permanently removed and stored off-site under the plan. This plan ÜÎßÚÌ ðê Ú»¾ îðïî Page 11 of 32 will be independently reviewed and approved as to feasibility, reasonableness, and removal from site by a qualified consultant mutually agreed to by the parties, with costs of such consultant shared equally by the parties . CITY H. Within thirty days after satisfaction of the Benchmarks, the will disburse the Property Site Development Forgivable Loan and provide the guarantee(s) of Guaranteed Loan(s). I. Depending upon the currently projected Federal environmental review timeline, SHINE these Benchmarks set forth in Subsection G above are expected to be achieved by between July 2012 and October 2014. CITY J. The Common Council of the , on December 22, 2011, in open session during a C Special Meeting, lawfully authorized the exercise of the Option to Purchase the PROPERTYCITY from the current owner. The , therefore, may now close upon its purchase of PROPERTYSHINECITYSHINE, the . At such time as may determine, the shall convey to in PROPERTY fee simple, the approximately Eighty Four (84) acre valued at approximately Eighteen Thousand Two Hundred Thirty Six and 00/100 Dollars ($18,236) per acre (land purchase price calculated as Eighteen Thousand and 00/100 Dollars ($18,000) per acre plus agricultural transfer fee in the amount of Two Hundred Thirty Six and 00/100 Dollars ($236) per acre, adjusted SHINE for 2010 (latest rate) for One Dollar ($1.00) plus the other good and valuable consideration, SHINECITY tax increment and tax increment equivalent payments to the as promised in this AGREEMENT , no warranties and subject to all of the Design Standards, Deed Covenants and AGREEMENT Restrictions, and other encumbrances and restrictions set forth in this and any attachments hereto; customary restrictions for utilities serving the property; recorded easements; land use and zoning laws and ordinances; and other matters of record. K. The closing upon the purchase of the site is expected to occur in February SHINE, SHINE 2012 and will be sold and conveyed to on the condition that must commence FACILITY substantial and meaningful construction of the towards full completion within either PROPERTYSHINE (i) five (5) years of the closing of the conveyance of the to , if SHINE is not actively pursuing obtaining all regulatory approvals necessary to construct the FACILITY at the conclusion of such five-year period, or (ii) up to seven (7) years after the closing CITYPROPERTYSHINESHINE of the to , as long as continues to actively FACILITY pursue obtaining all regulatory approvals necessary to construct the CITY reasonably determines that substantial construction by the Required CITYAGREEMENT Start Date, the may terminate the as set forth in V.E.2., and fee simple title PROPERTYCITY to the shall be returned to the . ÜÎßÚÌ ðê Ú»¾ îðïî Page 12 of 32 CITY L. Total out-of-pocket purchase and development cost incentives equals Four Million Nine Hundred Seventy Four Thousand Two Hundred Eighty Six and 00/100 Dollars CITY M. Costs associated with the guarantee of up to $4,000,000 of Guaranteed Loans SHINE are estimated at Fifteen Thousand and 00/100 Dollars ($15,000) for legal services. shall promptly provide such proof of compliance with any use requirements related to the Guaranteed Loan(s) guarantee(s), Storm Water Forgivable Loan, and Property Site Development Forgivable CITY Loan as the and/or City Administration may, from time to time, reasonably request and/or require. CITY N. The will complete the following by February 28, 2012: PROPERTY 1.Purchase of the from the current owner. CITY 2.Annexation of the 84 acres into the . 3.Amendment of the boundaries of existing T.I.F. District No. 35 to include the entire 84 acre parcel. CITY SHINE The agrees to provide reasonable pre-conveyance site access tofor the purposes of CITY additional survey work or environmental investigations as may be required, after the acquires PROPERTY the . SHINE O. hereby agrees that it shall: 1.Prior to the start of any construction, foundation work, or installation of any PROPERTY structure or other improvement upon the , seek and obtain approval fromthe City Site Plan Review Coordinator of the Site Plan and exterior appearance of every structure, improvement, and implementation proposed by SHINE PROPERTY. upon and/or for the FACILITY 2.Begin construction of the on or before the Required Start Date and use its best efforts to fully complete or cause to be fully completed construction FACILITYPROPERTY, of the upon the and obtain or cause to be obtained a FACILITY PROPERTY Final Certificate of Occupancy for the upon the from the City of Janesville Building Services Division within the Community Development Department reasonably promptly after beginning construction AGREEMENT 3.Create and maintain during all times pertinent to this the below ÜÎßÚÌ ðê Ú»¾ îðïî Page 13 of 32 specified and described full time equivalent positions (2,080 hours) employed at FACILITYPROPERTY the located upon the and/or other location(s) within CITY, . the as describedfurther in Exhibits C and DFor the purposes of this sub- SHINE section, the employment level shall be as reported by to the Wisconsin Department of Workforce Development for unemployment compensation st purposes on December 31. FACILITY a.Within one (1) year from the construction completion date, the equivalent of fifty (50) full time positions. FACILITY b.Within two (2) years from the construction completion date, the equivalent of one hundred (100) full time positions. FACILITY c.Within five (5) years from the construction completion date, the equivalent of one hundred twenty-five (125) full time positions. FACILITY 4.Construct any and all buildings, structures, , and other PROPERTY improvement(s) of whatsoever kind or nature upon the fully and SHINE,CITY solely at the expense of at no cost or expense whatsoever to the AGREEMENT except as set forth in this , and in compliance and in conformity with: CITY a. relevant approvals and permits granted and/or issued by the under the zoning, building, and architectural review ordinances pertaining thereto; and CITY b. each and every applicable , Federal, state, county and other ordinance, directive, statute, code, regulation and law in effect at the time applicable under law. SHINE's 5. Arrange, solely at cost, for the installation, connection, and lateral extension of water, sewer, storm drainage, natural gas, and underground FACILITY, electrical utilities from thestreet right-of-way to theof any costs that would exceed the Property Site Development Forgivable Loan incentive of One Million Five Hundred Thousand and 00/100 Dollars ($1,500,000), as described above. FACILITY PROPERTY, 6. Fully complete construction of the upon the which shall increase and maintain a real and personal property equalized assessed PROPERTY valuation of the of at least Twenty Five Million and 00/100 Dollars ($25,000,000). ÜÎßÚÌ ðê Ú»¾ îðïî Page 14 of 32 CITY a. The intends to incur direct and indirect T.I.F. District No. 35 costs CITY and related expenditures plus interest thereon which the expects to be repaid from tax payments, tax increment payments, tax equivalency SHINE payments, and/or other payments by from construction FACILITY and operation of the located within T.I.F. District No. 35. AGREEMENT b. For purposes of this , the parties agree that the share of PROPERTY such costs and related expenditures applicable to the shall CITY include incentive package Parts One, Two, Three, and Four, CITY described above.Total incentive package is valued at: Four Million Nine Hundred Seventy Four Thousand Two Hundred Eighty Six and 00/100 Dollars ($4,974,286). CITY 7. Guarantee that the - Four Million Nine Hundred Seventy Four Thousand Two Hundred Eighty Six and 00/100 Dollars ($4,974,286). Beginning with the tax year following full completion of the construction and issuance of the final occupancy CITYeach year certificate therefore by the and for thereafter until the SHINE Property Break-Even Amount is satisfied in full, , its successors and CITY assigns shall annually pay to the the higher of: a.the actual real and personal property taxes and/or tax increments but both SHINEPROPERTY FACILITY solely under the TIF paid by for the and net of any State of Wisconsin property tax credits that are actually realized, CITY obtained, paid to, and kept by the , if such amount equals or exceeds $583,282; or b.the total of: (1) that portion of real and personal property taxes levied upon PROPERTY FACILITY SHINE, the andand paid by net of any State of Wisconsin property tax credits, that are actually realized, obtained, paid to CITYandSHINE and kept by the , (2) an additional payment from to the CITY CITY receives a total of not less than Five Hundred Eighty Three Thousand SHINE Two Hundred Eighty Two and 00/100 ($583,282) annually from an assessed value of Twenty Five Million Dollars ($25,000,000) for the PROPERTYFACILITY, and to be created and maintained during the life ÜÎßÚÌ ðê Ú»¾ îðïî Page 15 of 32 AGREEMENT of this , multiplied by the average equalized tax mill rate for the previous ten (10) years of January 1, 2002, through and including January NOTWITHSTANDING 1, 2012. any actual equalized or other mill rate, tax SHINE levy, or equalized or other assessed value(s) in the future, (and its authorized successors and assigns) agrees that it shall pay the Tax CITY Equivalency Payment to the each year that the amount received by the CITY under section IV.O.7.(a) does not equal or exceed $583,282, until the CITY recoups the Property Break-Even Amount. SHINE 8. If is required to make a Tax Equivalency Payment in addition to the real CITY and personal property taxes and/or tax increments received by the for the PROPERTY, said additional Tax Equivalency Payment shall be due and CITYSHINE ( payable directly to the , and and its permitted successors and CITY assigns) agrees to and shall make such payment(s) directly to the , at the same time each year that the real and personal property taxes for the PROPERTY become due and payable without penalty. Time is of the essence in this regard as it is for all other payments, repayments, and performance by SHINE. SHINE's 9. The purpose for such tax, tax increment, and/or Tax Equivalency Payments, and the primary purpose, intent, and goal of Section IV.O. 7 and 8., is CITY to guarantee that the fully recovers all of its incentives, incentive payments, related loans, and Project and Project Plan, as amended, costs, fees, expenses, Debt Service, and other payments, and its proportionate share of T.I.F. SHINE District No. 35 expenditures from within the recovery time period AGREEMENT, provided by this but never to exceed the time permitted by law, PROPERTY, regardless of the actual market or assessed value of the the real and personal property tax mill rate, or the tax or tax increment payments for any FACILITYPROPERTY or all years after the construction of the upon the by SHINESHINE's . The further intent and goal hereof is and each of its CITY additional Tax Equivalency Payments and other payments to the in the SHINE event that , for whatsoever reason(s) without limitation, fails to provide PROPERTY improvements to the that result in an assessed value for the PROPERTY of $25,000,000 or more, which improvements in and of themselves ÜÎßÚÌ ðê Ú»¾ îðïî Page 16 of 32 jointly or severally would be expected to generate sufficient actual and/or SHINE's assessed value so as to enable fulfillment of the stand-alone and CITY separate minimum agreed payments to the required by Sections IV.O. 7 SHINEAGREEMENT. and 8. and other related promises set forth in the AGREEMENT 10. Notwithstanding anything set forth in this to the contrary, AGREEMENT the express intent of the parties to this is that tax, tax increment, and Tax Equivalency Payment and other repayments promised by SHINE herein for the Property Site Development Forgivable Loan and the Storm CITYSHINE Water Forgivable Loan from the to stand alone, are not interdependent, and are not conditioned upon the real and personal property PROPERTYFACILITY assessed value for the and being at least $25,000,000. PROPERTYFACILITY a. Assessment of the value of the , , and EQUIPMENT, for tax purposes as manufacturing real and personal property, under current Wisconsin law and practice, is performed by the State of Wisconsin Department of Revenue (WDOR) and, therefore, outside the SHINECITY. management or control of both and the ing manufacturing AGREEMENT property, in the event that for any year during the term of this PROPERTY the combined real and personal property tax assessments for the , FACILITY , and Equipment is less than the $25,000,000 aggregate value, SHINE has agreed to annually make a combined tax, tax increment, Tax Equivalency Payments and other payments in an amount of not less than CITY, $583,282 to the as set forth in Section IV. O. 7. c. In essence, therefore, the parties acknowledge and intend that the tax, tax CITY increment, and Tax Equivalency Payments to the under Section IV.O.7. CITYSHINE constitute a separate and distinct promise to the by . 11. In addition to the tax, tax increment and tax equivalency payments, on an annual basis, SHINEshall pay annual debt service payments for the following loans: a.Storm Water Forgivable Loan = Five Hundred Seventy Eight Thousand and 00/100 Dollars ($578,000), for a ten (10) year term at 0 % interest = Fifty Seven Thousand Eight Hundred and 00/100 Dollars ($57,800) per year until th SHINECITY paid in full by to the or is otherwise forgiven in 1/10 ÜÎßÚÌ ðê Ú»¾ îðïî Page 17 of 32 increments as discussed more fully above and in Exhibit C. Unless forgiven, each $57,800 annual installment payment for this purpose is due and payable SHINECITY by to the annually. b.Property Site Development Forgivable Loan of One Million Five Hundred Thousand and 00/100 Dollars ($1,500,000) for a ten (10) year term at 0 % interest = One Hundred Fifty Thousand and 00/100 Dollars ($150,000) per SHINECITY year until paid in full by to the or is otherwise forgiven in th 1/10 increments as discussed more fully above and in Exhibit D. Unless forgiven, each $150,000 annual installment payment for this purpose is due SHINECITY and payable by to the annually. PROPERTYFACILITY P. For this , and project, and for all future real estate and project expansions that either stand alone or are part of an existing project or facility, and/or the CITYSHINE expansion of an existing facility within the , agrees to and shall fully, timely, and CITY successfully satisfy and meet all Industrial Park Deed Restrictions, a copy of which is AGREEMENT included in this as Exhibit B. This includes, but is not limited to, fully, timely, and successfully satisfying the non-metallic materials on the exterior side of the building facing a street or Interstate Highway requirements as set forth in the Industrial Park Deed Restrictions. AGREEMENTSHINE Q. During the Term of this , may not sell or conveyed any part, PROPERTY portion or whole of the to any person, firm, corporation, partnership, association, joint or other venture, or other entity of whatsoever kind or nature ("Person"), who/which would not be legally or otherwise required to pay tax, tax increment or tax equivalency payments agreed to be SHINECITY paid pursuant to Section IV.O.7.; except that if (i) pays the the Property Break Even Amount less the aggregate actual property tax and Tax Equivalency Payments previously paid by SHINECITYPROPERTY to the for the in T.I.F. No. 35., and less all unearned interest or CITY unexpended financing charges included in the Property Break-Even Amount for the PROPERTYSHINE CITY as of the date of such payment by to the , (ii) reimburses the City for any payments made by the City pursuant to any City guarantee of Guaranteed Loan(s); and (iii) SHINE obtains a release of all future obligations under the City guarantee(s) of Guaranteed Loans, PROPERTY may sell and convey the without the prior approval. Any other sale or PROPERTYSHINE conveyance of the is permitted only if complies with the assignment SHINE provisions set forth in Section V.I below. Notwithstanding the foregoing provisions, shall PROPERTY have the right to mortgage the with a first priority lien to the lender(s) of its choice, to secure one or more construction loans for the project provided for herein as well as any subsequent ÜÎßÚÌ ðê Ú»¾ îðïî Page 18 of 32 refinancing thereof. SHINE'sAGREEMENT R. obligation to perform under this is subject to and SHINE contingent upon obtaining, prior to initiating construction: 1. All required approvals, including signage and exterior appearance, by all governmental agencies necessary for the design and construction of the FACILITYSHINEPROPERTY by on the on terms and conditions satisfactory SHINE. to 2. Commitments for construction financing and permanent project financing for the FACILITYSHINE PROPERTY to be constructed by on the on terms and SHINE. conditions satisfactory to PROPERTYCITY 3. Ownership of the in fee simple from the with access requirements and acceptable easements and restrictions, including rights to obtain access to a major road or highway. 4. Determining, in s sole discretion, that the project is still a viable business. SHINECITY S. shall provide to the such written notice of the termination of this AGREEMENT or waiver(s) and/or proofs of satisfaction of the above contingencies acceptable to the CITYFACILITYPROPERTY. one week prior to the issuance of a building permit for the on the Such proofs of satisfaction may be redacted to delete sensitive information. CITY'sAGREEMENT T. The obligation to perform under this is further contingent upon each and every of the following: CITY's 1.Thetimelyreceipt of any and all waivers and satisfactions of contingencies SHINEAGREEMENT SHINE required of under this (including but limited to contingencies under Section IV. R. above); and CITY 2.Approval by the Common Council of the of an amendment to the boundary of PROPERTY. existing T.I.F. District No. 35 to include the Such amendment to the boundary of T.I.F District No. 35 is expected to occur by the end of February, 2012. SHINEAGREEMENTCITY U. shall have the right from the date of this to pay to the (i) the sum of Four Million Nine Hundred Seventy Four Thousand Two Hundred Eighty Six and 00/100 Dollars ($4,974,286) less the aggregate actual property tax and tax equivalent payments previously paid SHINECITYPROPERTY by to the for the in T.I.F. No. 35., and less all unearned interest or CITY unexpended financing charges included in the Property Break-Even Amount for the PROPERTYSHINE CITY; as of the date of such payment by to the plus (ii) any sums paid by the ÜÎßÚÌ ðê Ú»¾ îðïî Page 19 of 32 SHINE City pursuant to guarantees of Guaranteed Loans. In the event that exercises this alternative CITY, and pays such sums to the and obtains a release of any City guarantees of Guaranteed Loans, SHINE then and only then shall no longer be required to make Tax Equivalency Payments as set forth AGREEMENT in Section IV.O. 7. of this . This payment, however, would not waive or modify any SHINECITY annual or other loan and/or debt service payments by to the that remain outstanding for the Property Site Development Forgivable Loan or Storm Water Forgivable Loan. Further, upon the making of such alternative payment, the covenants and restrictions as contained in Section IV. Q. shall be deemed null and void and of no further force or effect. V. OTHER PROVISIONS AGREEMENT A. Time is of the essence as to the performance of this and each obligation herein. In the event that either Party is delayed for any reason in performing any of its AGREEMENT promises as set forth in this , all dates shall be extended for a reasonable period not to exceed thirty (30) days. CITY B. The warrants and represents that the Common Council for the City of Janesville has lawfully authorized this transaction and has otherwise authorized the City Manager and/or the City Administration to take such steps, enter into negotiations, and draft, prepare, execute, file and/or record this and related agreements, documents, forms and other papers as the City Manager may, from time to time, determine necessary and/or desirable to consummate and/or AGREEMENT effectuate the transaction(s) set forth in, and intent and purposes of, this . SHINECITYSHINE C. acknowledges that has informed of Wisconsin Statutes ss. 66.1105(6c), which requires any for-profit entity that operates within a T.I.F. district for which the CITY has incurred T.I.F. district costs, to notify the Department of Workforce Development and the local private industry council of any position to be filled for a period of one year from the payment of such project costs. CITY D. 1. The shall provide to SHINE at or before closing certified photocopies of all necessary Common Council resolution(s) and/or minutes evincing said authorizations in a form suitable for filing with the Rock County Register of Deeds. obtainAGREEMENT 2. The word "" as it appears throughout this as it pertains to required performances by SHINE means that SHINE shall: a. Seek to acquire such approval or permission as is required in this ÜÎßÚÌ ðê Ú»¾ îðïî Page 20 of 32 AGREEMENT and that granting such authority or permission is CITY discretionary and not mandatory on the part of the or any of its boards, commissions, bodies, or officials; b. Receive such discretionary authority or permission as necessary prior to any CITY further obligation on the part of the . E. 1. The term of this Agreement commences as of the date set forth below and SHINE continues until the last repayment by or its permitted successors or CITY assigns has been made for any loan, guarantee or incentive from the with the terms of this Agreement, or amended in writing signed by both Parties. FACILITYAGREEMENT 2. Prior to the start of construction of the , this may CITY be terminated by the if one or more of the contingencies set forth in IV.K. AGREEMENT or IV. U. have not occurred or been met. This may be SHINEFACILITY terminated by prior to the start of construction of the if one or more of the contingencies or factors set forth in IV. R. have not occurred or been met. The party exercising such right of early termination shall provide prompt written notice to the other party. Upon early termination pursuant to this subsection E.2., neither party shall have any further rights against the other SHINECITY hereunder, except for prompt conveyance in fee simple by to the PROPERTYSHINE of the from and repayment within thirty (30) days of CITY outstanding amounts owed on any funds loaned or granted by the under AGREEMENT the terms of this . Each party shall bear all other costs or expenses incurred by it as a result of entering into or terminating this AGREEMENT . AGREEMENT 3. Either party may terminate this immediately if the other party: (a) commits a curable material breach or default of an obligation under this AGREEMENT that is not remedied within thirty days after the nonbreaching party provides written notice thereof; (b) commits a noncurable material breach AGREEMENT or default of an obligation under this ; or (c) files for bankruptcy, becomes insolvent, or becomes an involuntary participant in a bankruptcy proceeding, if such involuntary proceedings are not dismissed within 60 days after commencement. SHINE 4. Notwithstanding the foregoing, the parties agree that, should fail to ÜÎßÚÌ ðê Ú»¾ îðïî Page 21 of 32 maintain the minimum employment levels specified in Section IV.O.3 and Exhibits C and D in any given year, the s sole remedy for such failure shall be the right to withhold forgiveness of payments due under the Property Site Development Forgivable Loan and/or the Storm Water Forgivable Loan for that year in which the minimum employment levels were not maintained by SHINE . SHINE 5. The parties further agree that failure of at any time pertinent to this AGREEMENTFACILITY to construct a that realizes a taxable assessed value of any amount less than Twenty-Five Million and 00/100 Dollars ($25,000,000) AGREEMENT shall not be considered a breach of this . Notwithstanding the SHINE foregoing, failure by to pay the Tax Equivalency Payment to the City AGREEMENT required by Section IV.O.7 shall constitute a breach of the . F. Neither party makes any warranty or representation except as expressly set forth herein. SHINE G. The parties agree to execute and deliver such other documents as counsel for AGREEMENT may reasonably request to consummate the transaction contemplated herein. This and all exhibits attached hereto (which the parties agree shall also act as the promissory note) constitutes the entire agreement between the parties and no modification shall be binding unless amended and agreed to in writing and signed by the affected parties. In the event of a conflict AGREEMENT between the language contained in this and the language contained in any other AGREEMENT document, this shall control. SHINE H. , by signing below, acknowledges having read, fully understanding, and AGREEMENT having personally received a copy of this . AGREEMENTSHINE I. This cannot be assigned by , its permitted successors and assigns to any person or entity that would be exempt from property taxes under section 70.11 of the Wisconsin Statutes (2009-- which would otherwise have no legal obligation to pay real or personal property taxes or the Tax SHINE Equivalency Payment. This Agreement may not be assigned by to other persons or entities CITY without the prior written consent of the which consent shall not be unreasonably withheld, SHINE except that may assign the Agreement to a third collateral assignment or pursuant to a bona fide plan of merger or a sale of substantially all of the SHINESHINE assets of , and (ii) the Assignee assumes all of the obligations of under this ÜÎßÚÌ ðê Ú»¾ îðïî Page 22 of 32 SHINE Agreement and has net assets equal to at least twice the Guaranteed Total Payment. agrees that it, its permitted successors and assigns will not merge with a Tax-Exempt Entity during the term of this Agreement. AGREEMENT J. This is binding upon the parties hereto and each and every of their respective successors and assigns. AGREEMENTCITY K. This creates no duty, obligation or responsibility in the or any member of the City Class and extends no rights, privileges, causes of action or claims in any AGREEMENT third persons not a part to this . AGREEMENT L. This shall be interpreted and construed in accordance with the laws of Wisconsin in which the Premises are located. M. No modification, amendment, waiver, or release of any provisions of this AGREEMENT or of any right, obligation, claim or cause of action arising hereunder shall be valid or binding for any purpose unless in writing and duly executed by both parties. N. No part, portion, provision, promise, paragraph, obligation, term, or section of this Agreement shall be deemed waived by reason of one party failing to enforce such breach at any time or from time to time. Any such waiver must be in writing. AGREEMENT O. Any notice which is required in connection with this shall be mailed, certified mail with return receipt requested, or delivered by nationally recognized overnight CITY carrier, or hand delivered, if to the : Eric Levitt, City Manager Municipal Building 18 North Jackson Street Janesville, WI 53545 If to SHINE: Dr. Gregory Piefer Shine Medical Technologies, Inc. 2555 Industrial Drive Monona, WI 53713 Person or place of notice may be changed from time to time by any party notifying the other in writing duly served of the change. ÜÎßÚÌ ðê Ú»¾ îðïî Page 23 of 32 This offer and AGREEMENT are hereby accepted. The warranties and representations made herein survive the closing of this transaction. The undersigned hereby agrees to the terms, contingencies, conditions and obligations set forth above, and acknowledges receipt of a copy of this AGREEMENT. Offered, agreed to, and entered into this _________ day of _________, 2012. SHINE MEDICAL TECHNOLOGIES By: Dr. Gregory Piefer, CEO State of Wisconsin ) ) ss ________ County) Subscribed to before me personally by ______________________ to me known to be the person who signed above this ____ day of ____________ , 2012 _____________________________________________________ Notary Public _______________ County,__________ _____________________ My commission: __________________ _____________________. ÜÎßÚÌ ðê Ú»¾ îðïî Page 24 of 32 This offer and AGREEMENT are hereby accepted. The warranties and representations made herein survive the closing of this transaction. The undersigned hereby agree to the terms, contingencies, conditions, and obligations set forth, supra, and acknowledge receipt of a copy of this AGREEMENT. This _______day of __________________, 2012. CITY OF JANESVILLE By: _________________________________ Eric J. Levitt City Manager By: _________________________________ Jean A. Wulf City Clerk-Treasurer State of Wisconsin ) ) ss Rock County ) Subscribed to before me personally by Eric J. Levitt, City Manager, and Jean Ann Wulf, City Clerk-Treasurer, to me known to be the same who signed above this ______ day of __________________, 2012. ____________________________________________ Notary Public Rock County, Wisconsin My commission ______________________ ÜÎßÚÌ ðê Ú»¾ îðïî Page 25 of 32 EXHIBIT A Map of the PROPERTY ÜÎßÚÌ ðê Ú»¾ îðïî Page 26 of 32 Exhibit B DESIGN STANDARDS/ DEED RESTRICTIONS CITY OF JANESVILLE INDUSTRIAL PARKS KNOW ALL PERSONS BY THESE PRESENTS: Whereas the City of Janesville, a Wisconsin Municipal Corporation, is the Owner of record title to a certain lot in the County of Rock, State of Wisconsin described in this Agreement and incorporated herein as if fully set forth, WHEREAS, the City of Janesville has undertaken to purchase a certain tract of land and cause the same to be improved as an industrial park for the benefit of all subsequent Owners of lots in said subdivision, and WHEREAS, the above-described parcel lies within that tract of land which the City of Janesville intends to improve as an industrial park; NOW, THEREFORE, in consideration of the aforesaid, the undersigned, the City of Janesville, as Owner of the previously-described land, does hereby declare that said parcel shall be subject to, and the same parcel shall be conveyed to, the specific conditions and restrictions contained herein: 1. Landscaping Plan Each Owner shall submit a landscaping plan to the City of Janesville Site Plan Review Coordinator. Before any landscaping is implemented and before any building upon or use of the previously-described land is made, said landscaping plan must be approved by the Site Plan Review Coordinator. However, if the Owner does not agree with the decision of the Site Plan Review Coordinator, the Owner shall have the right to appeal the decision to the Plan Commission of the City of Janesville. The Site Plan Review Coordinator and Plan Commission shall review said plan with the consideration that the proposed landscaping should: (a) Assist in controlling noise; (b) Provide adequate visibility for traffic; (c) Provide proper shielding of parking lots or storage yards; and (d) Be designed to make the area visually compatible with the surrounding neighborhoods and to esthetically minimize any adverse impact of the industry upon the neighboring community. ÜÎßÚÌ ðê Ú»¾ îðïî Page 27 of 32 2. Architectural Review Before any Owner is allowed to build upon the previously-described land, the architectural plans for any and all such buildings must be reviewed and approved by the Site Plan Review Coordinator. However, if the Owner does not agree with the decision of the Site Plan Review Coordinator, the Owner shall have the right to appeal the decision to the Plan Commission of the City of Janesville, whose decision shall be final. In reviewing such architectural plans, the Site Plan Review Coordinator and the Plan Commission shall follow the same design standards set forth in Paragraph 1 (d) and the following facade material standards. The Site Plan Review Coordinator may modify the following standards to recognize the creative and effective use of other design elements including but not limited to the use of line and form, materials texture, color, roof pitch, detailing on the windows and other features, and building placement on the site. The exterior building facade fronting any street or Interstate Highway right-of-way shall consist of, at a minimum, fifty (50%) percent non-metallic materials which could include but not be limited to brick, stone, stone aggregates, wood, and glass. Of the required fifty percent (50%) non-metallic materials, one-fifth (1/5th) may be satisfied with natural screening materials including berming and living plant materials. Any side yard facades which do not front on a public street shall consist of, at a minimum, twenty (20%) percent non-metallic materials. The twenty percent (20%) non-metallic materials requirement may be satisfied with natural screening materials including berming and living plant materials. Any side yard facades which front on a public street shall consist of, at a minimum, twenty five percent (25%) non-metallic materials. The twenty five percent (25%) non-metallic materials requirement may be satisfied with natural screening materials including berming and living plant materials. Expandable end walls designed to allow for future building expansion shall be exempted from this requirement, until the permanent end-wall is constructed. If a building is to be constructed in phases, the front facade of each building phase shall comply with this standard. For multi-story buildings, the facade area will be determined by the following formula: Facade Area =Number of floors X Height per floor X Length Note: Height per floor shall be calculated at a maximum of 12' For the purposes of this section, the area of natural screening materials shall be calculated based on the profile area of the berm or living plant materials at the time of planting. Berming shall not constitute more than one half of the natural screening unless approved by the Site Plan Review Coordinator. ÜÎßÚÌ ðê Ú»¾ îðïî Page 28 of 32 3. Front Setback The required front setback area of the previously-described parcel shall not be used for the parking of any automobiles, trucks, equipment, or for the storage of any materials whatsoever. The required front setback area shall be devoted to planting and other landscaping, with the sole exception of driveways and sidewalks that are necessary for ingress and egress. If any Owner does not landscape, beautify, and maintain the front setback area, the installation and maintenance of such landscaping may be undertaken by the City, and any and all reasonable costs thereof shall be charged against the real estate, shall be a lien upon the real estate, and shall be assessed and collected as a special tax. 4. Outside Storage Outside storage is prohibited in the front yard setback areas of the previously-described land. All outside storage areas must be screened from view from any public street. The type, density, height, and width of screening to be used must first be approved by the Site Plan Review Coordinator, unless appealed by the Owner to the Plan Commission. The decision of the Plan Commission is final. If any Owner fails to so screen any outside storage on the parcel, the planting, installation, and maintenance of such screening may be undertaken by the City, and any and all reasonable costs thereof shall be charged against the real estate, shall be a lien upon the real estate, and shall be assessed and collected as a special tax. 5. Parking Parking is prohibited on all public streets within the industrial park area. Each Owner is required to provide off-street parking for employees, clients, and visitors in accordance with the zoning regulations. The surface(s) of all parking areas, driveways, and sidewalks for ingress and egress shall be constructed with concrete or asphalt. All parking and storage areas must be graded and drained to collect storm water on the site, and to convey the storm water to a municipal storm sewer, if available. Parking of any automobiles, trucks, or equipment is prohibited in any required setback area which adjoins a public street. Parking is encouraged in the rear yard, but may be permitted in the front or side yard area, if it is screened from view from any public street. When the lot adjoins a secondary public street(s), the Site Plan Review Coordinator may allow parking within the required setback area of that secondary street(s), however, in no case shall the parking be allowed to encroach more than 50% into the required setback area. The type, density, height, and width of screening to be used must first be approved by the Site Plan Review Coordinator. The Owner may appeal the decision of the Site Plan Review Coordinator to the Plan Commission whose decision shall be final. If any Owner fails to so screen such parking, the planting, installation, and maintenance of such screening may be undertaken by the City, and any and all costs thereof shall be charged against the real estate, shall be a lien upon the real estate, and shall be assessed and collected as a special tax. ÜÎßÚÌ ðê Ú»¾ îðïî Page 29 of 32 6. Signs Any and all signs to be placed on the building or premises of the previously-described land are prohibited unless such sign(s) has been reviewed and approved by the Site Plan Review Coordinator and comply with the City's Sign Ordinance. In no case shall an off-premises sign be permitted. However, if any Owner does not agree with the decision of the Site Plan Review Coordinator, the Owner shall have the right to appeal the decision to the Zoning Board of Appeals. The determination of the Zoning Board of Appeals shall be final. The decision on signs shall be based on the design, location, size, and appropriateness to the area of the proposed sign(s). 7. Underground Utility Services All electrical, telephone, and similar utility service(s) to and across the previously-described land shall be placed underground. If any Owner fails to so place the utility service(s), the placement of said service(s) underground may be undertaken by the City, and any and all reasonable costs thereof shall be charged against the real estate, shall be a lien upon the real estate, and shall be assessed and collected as a special tax. 8. Sale or Subdivision of Property The Owner of this property shall not subdivide this property for the purpose of selling, conveying, or leasing any part thereof, without following all of the regulations and procedures of the City of Janesville Subdivision Ordinance. In no case shall the subdivision of this property result in an unimproved vacant lot that is less than three (3.0) acres in size. 9. Number of Buildings Per Lot The Owner of the Property or any subsequent lots comprising the Property, shall not construct more than one principal building per lot, unless the Property is developed in accordance with the Planned Unit Development regulations of the City of Janesville Zoning Ordinance. AIRPORT OVERLAY DISTRICT A.As an aside to the typical TIF Design Standards/Restrictions, it is also important to note that SHINE Facility will be located within the Airport Overlay Zoning District for the Southern WI Regional Airport. This means that the proposed development must be issued a separate Zoning/Building Site Permit under as required under the Ordinance. Various design-related standards are identified in the Overlay District to minimize potential hazardous impacts to the airport, aircraft and surrounding development that may result from proposed land use in the vicinity of the Airport. Those impacts generally include visual obstructions (glare/reflection, potential for noise sensitivity, creation of wildlife attractants (from storm water ponds, vegetation), height of structures, etc. B.Mitigation techniques are advocated in the Ordinance to achieve compliance with these ÜÎßÚÌ ðê Ú»¾ îðïî Page 30 of 32 standards. Those may include use of non-reflective building materials to minimize glare, proper orientation of buildings or other improvements, insulation techniques to reduce noise impacts, alternative storm water management designs or other suggested site plan modifications. C.This project will likely be the first of its kind to be reviewed and evaluated under the overlay district standards since the December 2009 adoption of the ordinance. Ensuring compliance with these regulatory provisions will occur at an administrative level through the Site Plan Review Process. In other words, no public review or approval process is required to approve the building- review will be to ensure that any proposed project in the overlay district satisfies the mitigation factors addressed in the code. The CITY will work with SHINE to address these aspects whenever or however we can. ÜÎßÚÌ ðê Ú»¾ îðïî Page 31 of 32 IN WITNESS WHEREOF, the officers of the City of Janesville, Wisconsin, Owner of said land, has hereunto set their hands and seals this ______ day of ___________________, 2012. CITY OF JANESVILLE _________________________________ By: Eric J. Levitt, Janesville City Manager ___________________________________ By: Jean Ann Wulf, City Clerk-Treasurer State of Wisconsin ) ) ss Rock County ) Subscribed to before me personally by Eric J. Levitt, City Manager, and Jean Ann Wulf, City Clerk-Treasurer, to me known to be the same who signed above this ______ day of __________________, 2012. ____________________________________________ Notary Public Rock County, Wisconsin My commission ______________________ ÜÎßÚÌ ðê Ú»¾ îðïî Page 32 of 32 HUMAN RESOURCES DIVISION MEMORANDUM February 13, 2012 TO: City Council FROM: Susan A. Musick, Human Resources Director SUBJECT: Action on a Proposed Resolution Extending Health Care & Related Benefits to Domestic Partners of Qualifying City & Library Employees (File Resolution No. 2012-863) Executive Summary Council Members Liebert and Rashkin requested that the City consider granting health plan benefits to the domestic partners of eligible City employees, and funeral leave to employees with domestic partners. As a result of this inquiry, the Human Resources Division: 1. Conducted a survey of Wisconsin Public Employers Labor Relations Association (WPELRA) to see if member cities, counties, or technical colleges provide benefits to domestic partners, and if so, what are the benefits, and eligibility criteria. 2. Reviewed the matter with our health plan third party administrator to obtain their thoughts and advice. It is difficult to estimate the number of City and Library employees who have a domestic partner. Currently, there are 70 unmarried employees with single medical plan coverage. However, we don’t track the number of single parents with family medical plan coverage, and who live with a domestic partner. There are unknowns in adding this benefit, making the City’s cost impact difficult to predict. Based on the experience of other employers with this coverage, the estimated cost could range from less than 1% to 5% of medical claims per year. Recommendation Staff recommends approval of extending the funeral leave benefit to Administrative and General Municipal employees with domestic partners. There is no staff recommendation on extending health plan benefits to the domestic partners of employees. City Manager Recommendation The City Manager recommends extending the funeral leave benefit to domestic partners and that any other administrative policy leave changes in the future that do not have a direct financial impact be extended to domestic partners. 1 I cannot recommend extending health insurance benefits currently based on the fact that we are reviewing health insurance benefits and other benefits may be impacted in 2013. Suggested Motion If Council decides to approve these benefits, then the proposed motion would be “I move to approve File Resolution Number 2012-863.” Key Points to Consider 1. The experience of other public sector employers indicates that the additional cost for domestic partner benefits is approximately 1% of their health plan costs. 2. At the same time, there is an unknown and potentially high risk to extend health care benefits to the domestic partners of employees. 3. The City is not aware of any difficulties in recruiting because of the lack of domestic partner benefits. 4. Most Wisconsin counties and municipalities do not offer domestic partner benefits unless they are part of the State Health Plan. 5. Adding domestic partner health plan benefits would result in added administrative work. 6. Implementing benefit changes vary by employee group: A. Benefit changes may be implemented for Administrative (non-represented) employees, and General Municipal (DPW) employees under the new collective bargaining law. B. The City would have a duty to bargain this health plan eligibility change with Transit Union employees. C. Based upon a pending lawsuit, the City’s obligation in the case of Police and Fire Unions is unclear. An Eau Claire County ruling is expected in the next couple of weeks that should clarify if the City may unilaterally offer domestic partner benefits to these two Unions, or has a duty to bargain the change. Current Benefits for City Employees with Domestic Partners Under the Wisconsin Family and Medical Leave (FMLA), the City allows employees to take state FMLA for the serious health condition of his or her domestic partner and for the parent of the domestic partner. Under the Wisconsin Retirement System (WRS), employees may purchase life insurance coverage for his or her domestic partner, the same as an employee would make this purchase for his or her spouse. Survey Results A survey was distributed by email to approximately 107 employer members of the th WPELRA on 8 September 2011, with a requested return date of September 16. In response, 38 completed surveys were returned. 2 1. Of those responding to the question regarding their definition of domestic partner (same gender, opposite gender, or both), four respondents indicated they follow the Wisconsin Statute definition (40.02.(21d)), which is copied and pasted below. "Domestic partnership" means a relationship between 2 individuals that satisfies all of the following: (a) Each individual is at least 18 years old and otherwise competent to enter into a contract. (b) Neither individual is married to, or in a domestic partnership with, another individual. (c) The 2 individuals are not related by blood in any way that would prohibit marriage under s. 765.03. (d) The 2 individuals consider themselves to be members of each other's immediate family. (e) The 2 individuals agree to be responsible for each other's basic living expenses. (f) The 2 individuals share a common residence. Two individuals may share a common residence even if any of the following applies: 1. Only one of the individuals has legal ownership of the residence. 2. One or both of the individuals have one or more additional residences not shared with the other individual. 3. One of the individuals leaves the common residence with the intent to return. 2. All employers are responsible to grant Wisconsin FMLA for the serious health condition of a domestic partner and the domestic partner’s parent, as State law provides. 3. All employers with WRS are responsible to offer spouse and dependent life insurance to employees’ domestic partners, at the employee’s expense. 4. Two employers allow employees to have paid time off for bereavement or funeral leave for the domestic partner (City of Appleton and Rock County). 5. Two employers allow employees to use sick leave for the illness of a domestic partner (City of Appleton and Price County). 1 6. Two employers with the State Health Plan offer health insurance to employees’ domestic partners (City of Fitchburg, Western Wisconsin Cares). 7. One employer with their own Health Plan offers health coverage to employees’ domestic partners (City of Appleton for same gender domestic partners). 8. Most employers do not require same gender relationship to be registered with their home County. 9. The WRS requires employees and their domestic partners complete an affidavit so that the employee’s domestic partner may receive WRS related benefits, e.g., life insurance, health insurance. Although the City of Madison did not respond to the survey, a review of their website indicates that the City participates in the State Health Plan and WRS, and therefore offers health and life insurance to the domestic partners of their employees. 1 The State Health Plan provides domestic partners coverage. 3 Although the City of Milwaukee did not respond to the survey, a review of their website indicates that the City offers health and dental benefits to the domestic partners of their employees for 18 of the City’s 25 Unions. The children of domestic partners are not covered by the City’s health and dental plans. Third Party Administrator For health plan purposes, our third party claims administrator can implement any decision the City should make in this matter. Points that our third party administrator brought up include: 1. Our stop loss insurer needs to be notified of, and approve, an eligibility change. 2. Domestic partner must be clearly defined. 3. If the City is going to make this change, then an open enrollment must be scheduled to allow employees to enroll their domestic partner. 4. An effective date must be identified for when the domestic partners would have coverage. 5. Dean’s insured business offers health plan benefits to domestic partners. Dean requires that the employee and his or her domestic partner complete an affidavit, and provide proof of their common residence. Cost Impact An employer takes on risk whenever it enrolls an employee and/or dependent onto the health plan. The experience of some other municipalities indicates that adding domestic partners has a cost of less than 1% per year. This would equal to approximately $70,000 per year for the City (based upon estimated 2012 medical claims). However, other studies urge caution that adverse selection of high-risk enrollees could result in cost increases of 3% to 5% if only 1% or 2% of the employees choose domestic partner benefits. For the City, this level of cost increase equates to $210,000 to $350,000 per year. The difficulty of adverse selection is that the City won’t know the cost impact until it occurs. Funeral Leave Currently, the City does not have this benefit for employees with domestic partners. However, the Human Resources Department recommends extending the funeral leave benefit (up to three days) for the death of a domestic partner of an Administrative employee or General Municipal (DPW) Employee. The police, fire, and transit unions would need to bargain for this benefit improvement. C: Eric J. Levitt, City Manager Jacob J. Winzenz, Director of Administrative Services & Assistant City Manager 4 RESOLUTION NO. 2012-863 A RESOLUTION TO EXTEND HEALTH CARE AND RELATED PACKAGE BENEFTS TO ALL OTHERWISE QUALIFYING CITY AND LIBRARY DOMESTIC PARTNER EMPLOYEES AND THEIR FAMILIES WHEREAS the City and Library have a non-discrimination policy which states all persons are given equal consideration without regard to race, creed (religion), color, sex, national origin, handicap as defined in the Americans with Disability Act, ancestry, arrest or conviction record, marital status, membership in Military Reserve, sexual orientation, or age..."; and WHEREAS the City and Library are committed to being a leader within the community with regard to diversity..."; and WHEREAS, the City and Library are committed to equal treatment of all employee families and couples; an inequity currently exists concerning certain employee benefits for same gender and opposite gender employees that is contrary to a fundamental sense of human fairness; and WHEREAS, employers compensate employees through more than just wages and salary by providing benefits such as health plan coverage, with the traditional benefits structure including an employee's opposite-sex spouse and children; WHEREAS, extension of all benefits not currently required by law to be extended to same gender and opposite gender employees and their families would satisfy this fundamental fairness inequity and be in the best interest of and benefit to the City and the Library, its employees, taxpayers, and community; and WHEREAS, such extension of benefits including, but not limited to, health care, prescription drug, dental, and vision care benefit packages and funeral leave to same gender and opposite gender domestic partners who otherwise would qualify (e.g. vesting requirements, hours per week, etc.) would increase the attractiveness of the City and the Library’s employment benefit package, thus, significantly facilitating successful employee recruitment and retention; and WHEREAS, current societal standards as annunciated by the State of Wisconsin, Milwaukee County, the Cities of Madison, Milwaukee, Fitchburg, Appleton, other Wisconsin communities, many institutions of higher education, and private sector employers is to extend health care and related benefit packages to all qualifying same gender and opposite gender domestic partners and their families; and WHEREAS, Wis. Stats. Sec. 40.02(21d) provides some by limited guidance as to the definition of “domestic partners” for Wisconsin Retirement System and certain State health insurance benefit purposes; and WHEREAS, although it is difficult to estimate the number of City and Library employees who have domestic partners, a health plan cost impact range is estimated from 1% ($70,000) to 5% ($350,000) of health costs per year. NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of Janesville that this Council stands for the proposition that same gender and opposite gender domestic partners be allowed access to and provided all of the same health care, prescription drug, dental, vision care, and other benefits, rights, and privileges, which are extended to opposite gender spouse relationships to which the latter are currently and, from time to time, may be entitled, and as are allowed by the IRS, commencing January 1, 2013, to the extent allowed by law; and BE IT FURTHER RESOLVED that this Council requests and directs that the City Administration: (a) Study and consult with the City’s health care advisors and others to determine appropriate definitions, standards, and related administrative procedures and processes for such extension; and (b) Extend health care, prescription drug, dental, and vision care to all qualifying opposite gender and same gender domestic partners of Administrative, General Municipal, and Library employees, and their children commencing January 1, 2013, to the extent allowed by law; and (c) Negotiate as appropriate, the extension of health care, prescription drug, dental, and vision care to all qualifying opposite gender and same gender domestic partners of Union employees and their children during collective bargaining negotiations for 2013, to the extent allowed by law; and (d) Extend the City’s funeral leave benefit to Administrative, General Municipal, and Library employees with qualifying opposite gender and same gender domestic partners, commencing January 2013; and (e) Negotiate as appropriate, the extension of the applicable contractual funeral leave to Union employees with qualifying opposite gender and same gender domestic partners during collective bargaining negotiations for 2013, to the extent allowed by law. BE IT FURTHER RESOLVED, that the City Administration include the costs arising from such extension in the proposed budget for fiscal/calendar year 2013. ADOPTED: Motion by: Second by: APPROVED: Councilmember Aye Nay Pass Absent Dongarra-Adams Liebert McDonald Eric J. Levitt, City Manager Rashkin Steeber ATTEST: Voskuil Jean Ann Wulf, City Clerk-Treasurer APPROVED AS TO FORM: City Attorney Wald Klimczyk Proposed by: Council Members Liebert and Dongarra-Adams Prepared by: City Attorney and Human Resources Director èÔ×úÇÉÓÎ×ÉÉùÛÉ×ÖÍÊøÍÏ×ÉÈÓÙìÛÊÈÎ×Êú×Î×ÖÓÈÉ úÇÉÓÎ×ÉÉ×ÉÈÔÛÈÍÖÖ×ÊØÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉ×ÎÒÍÃÛÙÍÏÌ×ÈÓÈÓÆ××ØÕ×ÛÎØÊ×ÓÎÖÍÊÙ×ØÓÆ×ÊÉÓÈÃÛÎØÎÍÎ ØÓÉÙÊÓÏÓÎÛÈÓÍÎÌÍÐÓÙÓ×ÉÛÎØÓÎÓÈÓÛÈÓÆ×É øÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉÛÊ×ÕÍÍØÖÍÊÚÇÉÓÎ×ÉÉ øÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉÌÊÍÆÓØ×ÛÎÓÎ×ÄÌ×ÎÉÓÆ× Ì×ÊÙ×ÎÈÓÎÙÊ×ÛÉ×ÓÎÚ×Î×ÖÓÈÉÙÍÉÈ×ÎÔÛÎÙ×Ï×ÎÈ ÈÍÈÔ×ÍÆ×ÊÛÐÐ×ÏÌÐÍÃ××ÙÍÏÌ×ÎÉÛÈÓÍÎÌÛÙÑÛÕ×ÛÎØÔÛÆ×Ú×ÙÍÏ×ÍÎ×ÍÖÈÔ×ÔÛÐÐÏÛÊÑÉÍÖÌÊÍÕÊ×ÉÉÓÆ× ÙÍÏÌÛÎÓ×ÉÈÔÛÈÆÛÐÇ×ØÓÆ×ÊÉÓÈÃ øÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉÛÊ×ÛÎÓÏÌÍÊÈÛÎÈÉÈ×ÌÈÍÅÛÊØ×ËÇÛÐÌÛÃÖÍÊ×ËÇÛÐÅÍÊÑ ú×Î×ÖÓÈÉÙÍÏÌÊÓÉ×Î×ÛÊÐÃ åÓÈÔÍÇÈØÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉÛÉÓÕÎÓÖÓÙÛÎÈÌÍÊÈÓÍÎÍÖÍÆ×ÊÛÐÐÙÍÏÌ×ÎÉÛÈÓÍÎÓÎÈÔ×ÖÍÊÏÍÖ ÉÌÍÇÉÛÐÚ×Î×ÖÓÈÉÓÉÇÎÛÆÛÓÐÛÚÐ×ÈÍÕÛÃÐ×ÉÚÓÛÎÚÓÉ×ÄÇÛÐÛÎØÈÊÛÎÉÕ×ÎØ×ÊÅÍÊÑ×ÊÉ øÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉÛÊ×ÛÎ×ÛÉÃÅÛÃÈÍÍÚÈÛÓÎÛÙÍÏÌ×ÈÓÈÓÆ×ÛØÆÛÎÈÛÕ×ÖÍÊÈÛÐ×ÎÈÛÎØÈÍØÊÓÆ× Ê×ÙÊÇÓÈÏ×ÎÈÛÎØÊ×È×ÎÈÓÍÎÍÖØ×ØÓÙÛÈ×Ø×ÏÌÐÍÃ××ÉóÖÍÎ×ÌÇÊÌÍÉ×ÍÖÛÚ×Î×ÖÓÈÉÌÊÍÕÊÛÏÓÉÈÍÌÊÍÆÓØ×Û ÉÛÖ×ÈÃÎ×ÈÖÍÊ×ÏÌÐÍÃ××ÉÛÎØÈÔ×ÓÊÖÛÏÓÐÓ×ÉÈÔ×Ê×ÚÃ×ÎÛÚÐÓÎÕ×ÏÌÐÍÃ××ÉÈÍÖÍÙÇÉÏÍÊ×ÍÎÈÔ×ÓÊÅÍÊÑ ÈÔ×ÎÛÌÐÛÎÈÔÛÈØÍ×ÉÎÍÈÓÎÙÐÇØ×ØÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉÓÕÎÍÊ×ÉÛÉÓÕÎÓÖÓÙÛÎÈÌÍÊÈÓÍÎÍÖÈÔ×ÅÍÊÑÖÍÊÙ× íÖÖ×ÊÓÎÕØÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉ×ÎÉÇÊ×ÉÛÎ×ÏÌÐÍÃ×ÊÓÉÌÊ×ÌÛÊ×ØÖÍÊÙÔÛÎÕÓÎÕÊ×ÐÛÈÓÍÎÉÔÓÌ Ê×ÙÍÕÎÓÈÓÍÎÐÛÅÉÖÍÊÉÛÏ×É×ÄÙÍÇÌÐ×ÉÛÙÊÍÉÉÈÔ×çÎÓÈ×ØéÈÛÈ×É èÔ×èÊÇ×ùÍÉÈÍÖìÊÍÆÓØÓÎÕô×ÛÐÈÔùÛÊ×ú×Î×ÖÓÈÉ ûÙÙÍÊØÓÎÕÈÍÈÔ×÷ÏÌÐÍÃ××ú×Î×ÖÓÈê×É×ÛÊÙÔóÎÉÈÓÈÇÈ×Û wÖÍÇÎØÈÔÛÈÓÎÌ×ÊÙ×ÎÈÍÖÈÔ×ÍÊÕÛÎÓÂÛÈÓÍÎÉÈÔÛÈÍÖÖ×ÊØÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉÈÔ×ÃÙÍÏÌÊÓÉ×Ð×ÉÉÈÔÛÎ Ì×ÊÙ×ÎÈÍÖÈÍÈÛÐÚ×Î×ÖÓÈÙÍÉÈÉvèÔ×É×ÖÓÎØÓÎÕÉÛÊ×ÙÍÎÉÓÉÈ×ÎÈÅÓÈÔÈÔ××ÄÈ×ÎÉÓÍÎÍÖØÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉÚÃ ÐÍÙÛÐÌÇÚÐÓÙÛÎØÌÊÓÆÛÈ××ÏÌÐÍÃ×ÊÉÓÎåÓÉÙÍÎÉÓÎ èÔ×ùÓÈÃÍÖïÛØÓÉÍÎÅÔÓÙÔÔÛÉÍÖÖ×Ê×ØØÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÔ×ÛÐÈÔÚ×Î×ÖÓÈÉÖÍÊÙÓÈÃ×ÏÌÐÍÃ××ÉÉÓÎÙ× ÖÍÇÎØÈÔÛÈÈÔ×ÓÎÙÊ×ÛÉ×ÓÎÙÍÉÈÓÎÌÊÍÆÓØÓÎÕÊ×ÓÏÚÇÊÉ×Ï×ÎÈÖÍÊÔ×ÛÐÈÔÓÎÉÇÊÛÎÙ×ÖÍÊØÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÉ ÅÛÉÎ×ÕÐÓÕÓÚÐ×yÛÐ×ÉÉÈÔÛÎÍÎ×Ì×ÊÙ×ÎÈÓÎÙÊ×ÛÉ×ÓÎÈÔ×ùÓÈÃÉÔ×ÛÐÈÔÙÛÊ×ÚÇØÕ×È åÔ×ÎÈÔ×ùÓÈÃÍÖïÓÐÅÛÇÑ××ÍÖÖ×Ê×ØÈÔ×Ú×Î×ÖÓÈÉÓÎ ÖÛÊÖ×Å×ÊÈÔÛÎÍÎ×Ì×ÊÙ×ÎÈÍÖ×ÏÌÐÍÃ××É Ê×ÕÓÉÈ×Ê×ØÖÍÊÈÔ×Ú×Î×ÖÓÈÉé××wöÍÇÊÈ××ÎïÓÐÅÛÇÑ××åÍÊÑ×ÊÉé××ÑìÛÊÈÎ×Êô×ÛÐÈÔùÍÆ×ÊÛÕ×v ïÓÐÅÛÇÑ××òÍÇÊÎÛÐé×ÎÈÓÎ×Ðø×Ù óÎûÌÊÓÐ ÚÛÉ×ØûÏ×ÊÓÙÛÎöÛÏÓÐÃóÎÉÇÊÛÎÙ×ùÍÏÌÛÎÃÊ×ÌÍÊÈ×Ø ÈÔÛÈÈÔ×ÓÊÔ×ÛÐÈÔÙÛÊ×ÙÍÉÈÉÓÎÙÊ×ÛÉ×ØÐ×ÉÉÈÔÛÎÍÎ×Ì×ÊÙ×ÎÈÉÓÎÙ×ÈÔ×ÃÚ×ÕÛÎÍÖÖ×ÊÓÎÕØÍÏ×ÉÈÓÙÌÛÊÈÎ×Ê Ô×ÛÐÈÔÚ×Î×ÖÓÈÉÓÎ øÍÏ×ÉÈÓÙìÛÊÈÎ×Êú×Î×ÖÓÈÉíÖÖ×Ê×ØèÔÊÍÇÕÔÍÇÈåÓÉÙÍÎÉÓÎ ïÛÎÃåÓÉÙÍÎÉÓÎÌÇÚÐÓÙÛÎØÌÊÓÆÛÈ××ÏÌÐÍÃ×ÊÉÛÊ×ÛÐÊ×ÛØÃÌÊÍÆÓØÓÎÕØÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÔ×ÛÐÈÔÙÛÊ×ÙÍÆ×ÊÛÕ×ÈÍ ÈÔ×ÓÊ×ÏÌÐÍÃ××É÷ÄÛÏÌÐ×ÉÓÎÙÐÇØ× éÈÛÈ×ÍÖåÓÉÙÍÎÉÓÎíÉÔÑÍÉÔéÙÔÍÍÐøÓÉÈÊÓÙÈ ùÓÈÃÍÖûÌÌÐ×ÈÍÎïÛÊËÇ×ÈÈ×çÎÓÆ×ÊÉÓÈÃ ùÓÈÃÍÖïÛØÓÉÍÎûÐÐÓÛÎÈìÊ×ÙÓÉÓÍÎöÇÂ× ùÓÈÃÍÖïÓÐÅÛÇÑ××ùÍÏÌÛÎÃòÛÎ×ÉÆÓÐÐ× ïÓÐÅÛÇÑ××ùÍÇÎÈÃïÓÐÐ×ÊùÍÍÊÉ ø×ì×Ê×éÙÔÍÍÐøÓÉÈÊÓÙÈñÓÏÚ×ÊÐÃùÐÛÊÑ ðÛùÊÍÉÉ×ùÍÇÎÈÃûÏ×ÊÓÙÛÎöÛÏÓÐÃ öÍÊÛÖÇÐÐÐÓÉÈÍÖåÓÉÙÍÎÉÓÎ×ÏÌÐÍÃ×ÊÉÍÖÖ×ÊÓÎÕØÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉÆÓÉÓÈÔÈÈÌ ÖÛÓÊÅÓÉÙÍÎÉÓÎÙÍÏ ÙÍÇÌÐ×É ÅÓ×ÏÌÐÍÃ×ÊÉ ûÆÛÓÐÛÚÐ×ÖÊÍÏÈÔ×ôÇÏÛÎêÓÕÔÈÉùÛÏÌÛÓÕÎÛÈÔÈÈÌ ÅÅÅÔÊÙÍÊÕ Ê×ÉÍÇÊÙ×É ×ÎÈÊÃ ×ÉÈÛÚÐÓÉÔÓÎÕØÍÏ×ÉÈÓÙÌÛÊÈÎ×ÊÚ×Î×ÖÓÈÉ wøÍÏ×ÉÈÓÙìÛÊÈÎ×Êú×Î×ÖÓÈÉöÛÙÈÉÛÎØúÛÙÑÕÊÍÇÎØv÷ÏÌÐÍÃ××ú×Î×ÖÓÈê×É×ÛÊÙÔóÎÉÈÓÈÇÈ×ìÇÚÐÓÙÛÈÓÍÎö×ÚÊÇÛÊÃ ÅÅÅ×ÚÊÓÍÊÕ ÌØÖ ÌÇÚÐÓÙÛÈÓÍÎÉ ÖÛÙÈÉ DEPARTMENT OF PUBLIC WORKS MEMORANDUM 3 February 2012 TO: City Council FROM: Mike Payne, Engineering Manager SUBJECT: AWARD OF CONTRACTS - BID SCHEDULE “A” – 2012 CONTRACT 2012-1, ICE ARENA ADDITION & RENOVATION CONTRACT 2012-2, LANDFILL CLOSURE – PHASE 1 CONTRACT 2012-3, NEW SIDEWALK Summary Bids for Public Works Bid Schedule “A” – 2012, Contracts 2012-1, -2, and -3, were opened on Wednesday, January 25, 2012. Each of the low bids was found to be responsive and acceptable. Recommendation Following review by the Council, the Engineering Division recommends award of base bids for Contracts 2012-1, -2, and -3 to the low bidders and that the City Council express their intent to include necessary funding in the note issue. City Manager Recommendation The City Manager recommends that the City Council award all three bids to the low bidders and add alternate number 5 for the ice rink bid. Alternate number 3 would be the other alternate that the Council may want to consider. Alternate number 5 would replace the current lighting and alternate number 3 would add a canopy at the main entrance of the building. Suggested Motion I move to award contracts 2012-1 and include alternate number 5, 2012-2, and 2012-3 to the low bidders and express the intent to include in the 2012 Note Issue $675,000 for the Ice Arena project, $1,430,000 for the Landfill project, and $318,310 for new Sidewalks. Background Contract 2012-1, Ice Arena Addition & Renovation This project replaces the original 1974 ice making system equipment, adds a building addition for the zamboni and relocated mechanical room, and converts the former mechanical room to additional locker rooms. The Council approved the purchase of ice making system equipment by purchase order at the December 12, 2011 meeting. AWARD OF PUBLIC WORKS BID SCHEDULE “A” – 2012 3 FEBRUARY 2012 – PAGE 2. We received nine (9) bids for this project, with Scherrer Construction Co., Inc. providing the low bid. The Engineering Division is recommending award of the base bid to Scherrer Construction Co., Inc. of Burlington, Wisconsin, in the amount of $1,716,000. The bids received are shown below: Scherrer Construction Co., Inc. Base Bid: $1,716,000.00 601 Blackhawk Drive, P.O. Box 740 Alternate No. 1: $213,000.00 Burlington, WI 53105 Alternate No. 1A: $122,000.00 Alternate No. 2: $1,388,000.00 Alternate No. 3: $46,000.00 Alternate No. 4: $85,000.00 Alternate No. 5: $27,000.00 Alternate No. 6: $41,000.00 Vogel Bros. Building Co. Base Bid: $1,743,057.00 2701 Packers Avenue Alternate No. 1: $187,998.00 Madison, WI 53704-7541 Alternate No. 1A: $122,800.00 Alternate No. 2: $1,589,435.00 Alternate No. 3: $38,257.00 Alternate No. 4: $83,914.00 Alternate No. 5: $27,013.00 Alternate No. 6: $30,308.00 Magill Construction Company, Inc. Base Bid: $1,744,000.00 977 Koopman Lane Alternate No. 1: $192,000.00 Elkhorn, WI 53121 Alternate No. 1A: $148,000.00 Alternate No. 2: $1,385,000.00 Alternate No. 3: $43,900.00 Alternate No. 4: $86,156.00 Alternate No. 5: $27,735.00 Alternate No. 6: $29,336.00 Joe Daniels Construction Co., Inc. Base Bid: $1,768,000.00 919 Applegate Road Alternate No. 1: $235,941.00 Madison, WI 53713 Alternate No. 1A: $124,822.00 Alternate No. 2: $1,350,829.00 Alternate No. 3: $47,707.00 Alternate No. 4: $132,500.00 Alternate No. 5: $28,620.00 Alternate No. 6: $33,898.00 Gilbank Construction, Inc. Base Bid: $1,782,000.00 301 Scot Drive, P.O. Box 718 Alternate No. 1: $220,000.00 Clinton, WI 53525 Alternate No. 1A: $121,000.00 Alternate No. 2: $1,650,000.00 AWARD OF PUBLIC WORKS BID SCHEDULE “A” – 2012 3 FEBRUARY 2012 – PAGE 3. Alternate No. 3: $45,000.00 Alternate No. 4: $86,000.00 Alternate No. 5: $28,000.00 Alternate No. 6: $34,000.00 Klobucar Construction Co., Inc. Base Bid: $1,874,000.00 3140 E. County Road S Alternate No. 1: $211,700.00 Beloit, WI 53511 Alternate No. 1A: $133,890.00 Alternate No. 2: $1,413,000.00 Alternate No. 3: $44,850.00 Alternate No. 4: $87,700.00 Alternate No. 5: $29,940.00 Alternate No. 6: $41,300.00 Tri-North Builders, Inc. Base Bid: $1,958,000.00 2625 Research Park Drive Alternate No. 1: $216,000.00 Fitchburg, WI 53711 Alternate No. 1A: $136,000.00 Alternate No. 2: $1,410,000.00 Alternate No. 3: $46,500.00 Alternate No. 4: $88,000.00 Alternate No. 5: $28,000.00 Alternate No. 6: $40,000.00 Miron Construction Co., Inc. Base Bid: $1,961,400.00 1471 McMahon Drive Alternate No. 1: $184,970.00 Neenah, WI 54956 Alternate No. 1A: $120,000.00 Alternate No. 2: $1,545,500.00 Alternate No. 3: $47,400.00 Alternate No. 4: $85,300.00 Alternate No. 5: $27,430.00 Alternate No. 6: $32,020.00 Corporate Contractors, Inc. Base Bid: $2,781,233.00 655 Third Street, Ste. 300 Alternate No. 1: $209,840.00 Beloit, WI 53511 Alternate No. 1A: $126,609.00 Alternate No. 2: $1,543,647.00 Alternate No. 3: $35,336.00 Alternate No. 4: $85,259.00 Alternate No. 5: $24,706.00 Alternate No. 6: $28,184.00 Alternate No. 1 includes a 1,443 sf new building addition of unfinished program space. Alternate No. 1A includes finishing the 1,443 sf new addition as a locker room with restrooms and a shower area. Alternate No. 2 includes a 7,121 sf new addition for AWARD OF PUBLIC WORKS BID SCHEDULE “A” – 2012 3 FEBRUARY 2012 – PAGE 4. additional seating at the east end of the ice sheet, a small concession area, and new public restrooms. Alternate No. 3 includes a new canopy at the main entrance of the building. Alternate No. 4 includes new dasher boards and glass around the ice sheet. Alternate No. 5 includes new lighting over the ice sheet. Alternate No. 6 includes installing a fire sprinkler system in areas not included in the base bid which is essentially over the ice sheet, over the spectator area, and miscellaneous open spaces. Summary of Anticipated Project Costs: Consultant design fees $ 230,500 Geothermal ice making equipment $ 615,600 Stairs, lighting & misc to access Armory parking stalls $ 47,000 Asbestos removal $ 2,500 Base Bid $1,716,000 5% contingency (of $615,600 + $1,716,000) $ 116,600 Project Total = $2,728,200 Funding for Contract 2012-1 will come from various sources: prior Note Issue funding included $1,900,000 for the project with an additional $177,500 in Energy Efficiency Community Development Block Grant monies already designated for this project. An additional $650,700 will be included in the 2012 Note Issue. Contract 2012-2, Landfill Closure – Phase 1 This project caps phase 1 of the operating landfill which was constructed in 2005 and includes improvements to the leachate collection system, gas collection system, and perimeter access road in addition to constructing the 5 ft thick capping system. We received four (4) bids for this project, with Meise Construction, Inc. providing the low bid. The Engineering Division is recommending award to Meise Construction, Inc. of Plain, Wisconsin, in the amount of $1,428,857.01. The bids received are shown below: Meise Construction, Inc. Total Bid: $1,428,857.01 1290 Oak Street Plain, WI 53577 Veit & Company, Inc. Total Bid: $1,577,895.25 2445 S. 179th Street, Suite E New Berlin, WI 53146 Frank Silha & Sons Excavating Inc. Total Bid: $1,662,990.60 348 E. Highway 14 Janesville, WI 53546 Buteyn-Peterson Construction Co., Inc. Total Bid: $1,730,412.25 N7337 Dairyland Drive AWARD OF PUBLIC WORKS BID SCHEDULE “A” – 2012 3 FEBRUARY 2012 – PAGE 5. Sheboygan, WI 53083 Funding for this project will be the 2012 Note Issue. Contract 2012-3, New Sidewalk This contract includes 54,500 square feet of new sidewalk at locations included on Resolution No. 2011-834 as approved by City Council on October 24, 2011. This is the second year of a seven year program to eliminate gaps within the existing sidewalk network. We opened four (4) bids for this project, with J.B. Johnson Bros., LLC providing the low bid. The Engineering Division is recommending award of this contract to J. B. Johnson Bros., LLC, of Edgerton, Wisconsin, for a total amount bid of $327,680. The bids received are shown below: J. B. Johnson Bros., LLC Total Bid: $327,680.00 12 Maple Court Edgerton, WI 53534 Standard Sidewalk, Inc. Total Bid: $390,800.00 10841 Mankato Street NE P.O. Box 490504 Blaine, MN 55449 Concrete Idea, Inc. Total Bid: $417,672.50 13961 44th Lane Saint Michael, MN 55376 Yeske Construction Co., Inc. Total Bid: $495,685.00 P.O. Box 71 Edgerton, WI 53534 Engineering and Finance staff will calculate assessment rates using actual bid prices. Funding for this work will be provided by several sources including special assessments to the abutting property owners ($239,100), the City Funded Sidewalk account ($9,370), and 2012 Note Issue borrowing ($79,210). The Major Capital Projects budget included $200,000 in the 2012 Note Issue for sidewalk ramps / locations abutting public property and $335,000 for sidewalk assessable to property owners. cc: Eric Levitt Jay Winzenz Carl Weber DEPARTMENT OF PUBLIC WORKS MEMORANDUM 3 February 2012 TO: City Council FROM: Mike Payne, Engineering Manager SUBJECT: ACTION ON A PROPOSED PRELIMINARY RESOLUTION FOR ASSESSABLE SEWER AND WATER LATERALS AND SCHEDULE A PUBLIC HEARING FOR THE FINAL RESOLUTION ON FEBRUARY 26, 2012 (FILE RES. NO. 2012-881) Summary: The Resolution includes sewer and water laterals, affecting two properties on McCormick Drive, which is required prior to the Wisconsin Department of Transportation constructing roadway modifications in 2012. One property is in the City and the other property is outside the City. By adopting this Preliminary Resolution, the City is declaring its intent to assess the abutting properties benefited by these improvements. The City Council approved Final Assessment Resolution 2011-846 on October 24, 2011 for sewer and water lateral installations along McCormick Drive. The two properties affected by the attached Preliminary Resolution No. 2012-881 were not included on the previous resolution because it was anticipated the sewer and water mains could be accessed following the DOT improvements without impacting the new pavement. It was determined in the field while the contractor was working that the water and sewer mains were closer to the existing pavement than anticipated which required laterals to be installed. Category I includes water and sewer laterals (for assessment purposes only). City Manager’s Recommendation: th The City Manager recommends setting a public hearing for February 26. Engineering Division Recommendation: The Engineering Division recommends Preliminary Resolution No. 2012-881 be adopted and the Final Resolution and public hearing be set for Monday, February 26, 2012 Suggested Motion: I move to adopt Preliminary Resolution No. 2012-881 and set the Final Resolution and public hearing for Monday, February 26, 2012. Attachment - Resolution 2012-881 cc: Eric Levitt Jacob J Winzenz Carl Weber CITY OF JANESVILLE 13 FEBRUARY 2012 ASSESSABLE SEWER AND WATER LATERALS PAGE (1) OF (4) RESOLUTION NO. 2012-881 PRELIMINARY RESOLUTION PRELIMINARY RESOLUTION DECLARING INTENT TO EXERCISE SPECIAL ASSESSMENT POWERS UNDER SECTION 66.0703, WISCONSIN STATUTES AND REQUIRING INSTALLATION OF WATER, SEWER, AND GAS SERVICE PIPES AND PROVIDING FOR ASSESSMENT OF COSTS UNDER SECTION 66.0911, WISCONSIN STATUTES; RESOLVED, By the Common Council of the City of Janesville, Wisconsin. 1. The Common Council hereby declares its intention to exercise its power pursuant to S.66.0703 and S.66.0911, Laws of the State of Wisconsin, to levy special assessments on a reasonable basis upon property abutting the following described streets, pursuant to its police powers, by improvement of the said streets to further facilitate traffic flow and safety, and to assist in providing for the safety, health, and general welfare of the public, to-wit: I. SEWER AND WATER SERVICE LATERALS - FOR ASSESSMENT PURPOSES ONLY All Property Fronting Upon Each Side Of From To Mc Cormick Drive STH 26 (Milton Ave) CTH Y (John Paul Road) 2. Said public improvements shall include the above listed improvements on the various listed streets to the grades established therefore by the City Council of the City of Janesville, Wisconsin, and recorded in the Office of the City Clerk whether previously established or established in the future. 3. The property against which the assessments are proposed shall be benefited by the improvements and said assessments shall be made upon a reasonable basis. 4. That the actual levy of the special assessment shall take place at the time of the adoption of the final public works resolution by the Common Council of the City of Janesville concerning these improvements. The property owner(s), if any property abutting and/or benefitting from this project is located in Rock Township, against whose property such special assessment shall be levied under and by this Resolution, shall have their payment obligation deferred, without interest accruing thereon, until such time as their specific property is annexed or connects to such improvement(s), in which event the CITY OF JANESVILLE 13 FEBRUARY 2012 ASSESSABLE SEWER AND WATER LATERALS PAGE (2) OF (4) RESOLUTION NO. 2012-881 special assessment shall be due and payable either in full or in five (5) annual installment payments, the latter with interest accruing thereon from the date of annexation or connection. This method of payment shall be approved and ratified by the Board of the Town of Rock in accord with Section 66.0707 of the Wisconsin Statutes, and such other applicable provisions of law and intergovernmental agreement(s), and shall act, once so ratified by the Rock Town Board, as a levied special assessment against such abutting and/or benefiting properties in the Town of Rock. This levy and special assessment payment provisions are in accord with the City of Janesville/Town of Rock Cooperative Boundary Plan, City of Janesville Common Council Special Assessment Policy No. 63, related pertinent provisions, and the Town of Rock/Janesville Highway 11 Bypass Agreement. The special assessment levy and payments shall be made by the abutting, benefiting and affected property owners in accord with the LaPrairie and Rock Township City of Janesville Highway 11 Bypass Agreement, as well as the Rock/Janesville Cooperative Boundary Plan. This provision applies only to the properties located in the Town of Rock. 5. Excluding the assessment for the installation of sewer and water service pipes (lateral) and the assessment against any parcel owned by an individual property owner may be: (a) paid in cash upon completion of the work; or (b) paid with the taxes the first year following completion of the work; or (c) at the election of the property owner, spread over a period of five (5) years with interest at six percent (6%) per annum on the unpaid balance. The first installment on the five-year plan shall include one-fifth of the principal with the interest for November and December on the unpaid portion and shall be so entered in the Tax Roll. Each of the subsequent installments shall be entered in each of the annual tax rolls thereafter until all are collected. Deferred payment on the aforementioned installments shall bear interest at six (6%) per annum. The assessments against any parcel for sewer and water service pipes shall constitute a lien against such parcel and must be paid in cash or with the taxes in the year following the completion of the work. The assessments, as outlined above, pertain only to said individual property owners. The assessments against all parcels of land owned by others, which include subdividers, land developers, speculative builders, or owners of several or more lots on the same street or in the same area will be billed upon completion of the work after which interest at six percent (6%) per annum will be charged from the last day of the month of the billing. The assessments for said other owners may be: (a) paid in cash upon completion of the work in the month of billing without interest; or (b) paid with the taxes the first year following the completion of the work, the amount to be entered in the Tax Roll shall include the unpaid principal with interest through the end of December in the year so entered; or, (c) at the election of the property owner and with the approval of the Committee of Public Works, spread over a period of five (5) years with interest at six percent (6%) per annum on the unpaid balance. The first installment on the five-year plan shall include one-fifth of the principal with interest through the end of December in the year so entered. Each of the subsequent installments shall be entered on each of the annual tax rolls thereafter until all are collected. Deferred payment on the aforementioned installments shall bear interest at six percent (6%) per annum. \\Petey\COJHome\Agenda Review\Approved Agenda Items\2012\02-13-2012\McCormick Sewer - Res 2012-881.doc CITY OF JANESVILLE 13 FEBRUARY 2012 ASSESSABLE SEWER AND WATER LATERALS PAGE (3) OF (4) RESOLUTION NO. 2012-881 6. The City Engineer is directed to prepare a report consisting of: a. Final plans and specifications for said improvements, b. An estimate of the entire cost of the proposed improvements, c. A schedule of the proposed assessments, and d. A statement showing that the property against which the assessments are proposed is benefited, the improvement constituting an exercise of police powers. Upon completing such report, the City Engineer is directed to file a copy thereof in the City Clerk's Office for public inspection. The City Engineer is also directed to advertise for bids to carry out such work of such improvements in accordance with the report. 7. Upon receiving the report of the City Engineer, the Clerk is directed to give notice of a Public hearing on such report as specified in S.66.0703(7)(a), Wisconsin Statutes. The hearing shall be held at the Council Chambers in the Municipal Building at a time set by the Clerk, in accordance with S.66.0703(7)(a), Wisconsin Statutes. 8. The City has determined to undertake the capital improvements described in paragraph 1 above (the "Projects"). The City anticipates that moneys, other than the proceeds of any outstanding debt of the City, will be expended by the City with respect to such capital improvements. The City reasonably expects to be reimbursed for such expenditures with proceeds of its debt. The maximum principal amount of debt expected to be issued for the reimbursement of such expenditures is $5,000,000. No funds from sources other than the debt referred to above are, or are expected to be, reserved, allocated on a long-term basis, or otherwise set aside by the City or any entity controlled by the City pursuant to its budget or financial policies with respect to the Projects. This is consistent with the budgetary and financial circumstances of the City. Copies of this resolution shall be made available for public inspection in the manner required by law. This Resolution is a declaration of official intent under Treasury Regulation Section 1.150-2. \\Petey\COJHome\Agenda Review\Approved Agenda Items\2012\02-13-2012\McCormick Sewer - Res 2012-881.doc CITY OF JANESVILLE 13 FEBRUARY 2012 ASSESSABLE SEWER AND WATER LATERALS PAGE (4) OF (4) RESOLUTION NO. 2012-881 ADOPTED: MOTION BY: APPROVED: SECOND BY: COUNCILMEMBER AYE NAY PASS ABSENT Eric Levitt, City Manager ATTEST: DONGARRA-ADAMS LIEBERT Jean Ann Wulf, City Clerk-Treasurer McDONALD APPROVED AS TO FORM: RASHKIN STEEBER City Attorney, Wald Klimczyk VOSKUIL Proposed by: ENGINEERING DIVISION Prepared by: ENGINEERING DIVISION \\Petey\COJHome\Agenda Review\Approved Agenda Items\2012\02-13-2012\McCormick Sewer - Res 2012-881.doc ADMINISTRATIVE SERVICES MEMORANDUM February 3, 2012 TO: City Council FROM: Jacob J. Winzenz, Dir. of Admin. Services/Assistant City Manager SUBJECT: Action on a Proposed Resolution Authorizing the City Administration to Expend Funds to Replace Turf Maintenance Equipment at Riverside and Blackhawk Golf Courses (File Res 2012-885) Summary On December 31, 2010, the lease with Crown Golf for Riverside and Blackhawk golf courses expired and the City entered into a management contract with KemperSports. Under the terms of the lease with Crown, the lessee was responsible for providing all the equipment used to maintain the turf at both courses. Crown complied with that lease requirement, but at the end of the lease the equipment was at least ten (10) years old (see attached). The City purchased the maintenance equipment, along with other furnishings and fixtures, from Crown to get us through the 2011 golf season. The turf maintenance equipment is now eleven (11) years old, or older, and experiencing increased downtime and escalating maintenance costs. File Resolution 2012-885 authorizes the City Administration to begin replacing the maintenance equipment at the golf courses and commits the City Council to include $200,000 in the 2012 Note Issue. Recommendation City Staff and the Golf Course General Manager and Superintendent recommend that the City Council approve File Resolution 2012-885. City Manager Recommendation The City Manager recommends approval. Background On December 31, 2010, the lease with Crown Golf for Riverside and Blackhawk golf courses expired and the City entered into a management contract with KemperSports. Under the terms of the lease with Crown, the lessee was responsible for providing all the equipment used to maintain the turf at both courses. Crown complied with that lease requirement, but at the end of the lease the equipment was at least ten (10) years old (see attached). The lease with Crown included a provision that at the end of the lease term the City could purchase all equipment at the depreciated or fair market value. The City purchased the maintenance equipment, along with other furnishings and fixtures, from Crown to get us through the 2011 golf season. However, the turf maintenance equipment is now eleven (11) years old, or older, and experiencing increased downtime and escalating maintenance costs. A management contract is different than a lease. Under a management contract the City pays a management company a fee to manage the courses, but the City retains the responsibility to provide all the equipment necessary to operate and maintain the golf course. With an aging fleet of turf maintenance equipment staff has developed a multi-year plan to replace the critical pieces of equipment including such as greens mowers, fairway mowers, rough mowers, and trim mowers. The equipment listing attached to this memorandum indicates which equipment is scheduled for replacement from 2012 – 2016. At the time of replacement most of the mowers will range from 11 to 16 years in age. For comparison, mowers used for park maintenance are currently replaced at nine (9) years. This equipment is critical to maintain the course conditions that golfers expect at quality courses. Based upon the needs for replacement of maintenance equipment, and other anticipated capital needs, staff is projecting that we will need to borrow $200,000 each year for the next three (3) years (2012, 2013, and 2014). This will allow the replacement of the entire fleet of maintenance equipment and minimal amounts to meet other capital needs. Analysis The following table summarizes the debt service for the golf courses over the last seven (7) years: 2006200720082009201020112012Average $95,196$97,675$94,811$96,764$53,437$78,534$83,827$85,749 The average debt service over the last seven (7) years has been $85,749. It should be noted that prior to 2011 all debt service on debt issued for the golf courses was paid by the golf fund from lease payments made by Crown Golf. The following table summarizes the projected debt service if the proposed plan to borrow $200,000 in each of the next three (3) years is implemented: 2013201420152016201720182019Average $106,507$125,950$97,288$94,248$95,175$93,048$90,886$100,443 Implementation of this proposal is estimated to result in an increase in the average annual debt service payment for the golf courses by approximately $15,000 per year. When the debt is actually issue, staff may propose to structure the debt repayment slightly to avoid the debt service spike in 2014, by this should not significantly affect the average. 2 Golf Course Equipment List 1/12/2012 Purchase Replace Age @ Estimated ItemLocationHoursYearYearReplaceReplace Cost Buffalo BlowerRiverside2001201211$6,000.00 HR 5111Blackhawk66461998201214$50,458.70 HR 9016Riverside93241999201213$50,000.00 Lely SpreaderRiverside1980201232$4,575.00 $42,235.86 LF 3400Riverside2001201211 LF 3400Riverside37942001201211$42,235.86 Tri KingRiverside36741998201214$51,996.40 $247,501.82 Greens MowerRiverside37722001201312$26,666.67 Greens MowerRiverside28222001201312$26,666.67 Greens MowerBlackhawk21431998201315$26,666.67 LF 123Blackhawk42611995201318$43,000.00 New Holland TractorRiverside25912001201312$25,000.00 Sprayer TruckRiverside15412001201312$36,000.00 Toro RakeRiverside1989201324$16,000.00 $200,000.01 GA30 544885Riverside8651993201421$21,000.00 GA30 544885Riverside1994201420$21,000.00 Tee MowerRiverside44822001201413$26,666.67 Tee MowerRiverside2001201413$26,666.67 Tee MowerBlackhawk22151998201416$26,666.67 TurfcatRiverside2001201413$20,000.00 $142,000.01 Cushman TruckRiverside15012001201514$20,000.00 Toro 325 DBlackhawk19122000201616 Tri KingBlackhawk20692001201615$52,000.00 Agri Metal BlowerRiverside2002N/A Agri Metal BlowerBlackhawk1994N/A Carry All 1Riverside1997N/A Carry All 1Riverside1997N/A Carry All 1Riverside1997N/A Carry All 2Riverside2000N/A Carry All 2Riverside2001N/A Carry All 2Blackhawk2000N/A Core HarvesterRiverside1992N/A Cushman TruckBlackhawk8842000N/A EdgerRiverside2001N/A F12 Top DresserRiverside1992N/A Golf Course Equipment List (cont.) 1/12/2012 Purchase Replace Age @ Estimated ItemLocationHoursYearYearReplaceReplace Cost GeneratorRiverside1997N/A Jacobsen RakeBlackhawk1998N/A John Deere Reel MowerBlackhawk1998N/A John Deere Reel Mower-PushRiverside1999N/A John Deere TractorBlackhawk1987N/A National 68"Riverside1989N/A RollerRiverside1989N/A RollerRiverside1991N/A Seed-A-VatorRiverside2001N/A Sod CutterRiverside1995N/A SP1530 Top DresserRiverside2001N/A SpikerRiverside1983N/A SweeperRiverside6911996N/A Toro Push MowerRiverside2009N/A Toro RakeRiverside?N/A Tri KingRiverside37461998N/AEliminate VericutterRiverside1991N/A Walk Behind BlowerBlackhawk?N/A 4 RESOLUTION NO. 2012- 885 A Resolution authorizing the City Administration to expend funds to replace various pieces of turf maintenance equipment at Riverside and Blackhawk golf courses. WHEREAS, on December 31, 2010, the lease with Crown Golf for Riverside and Blackhawk golf courses expired and the City of Janesville assumed maintenance responsibilities; and WHEREAS, under the lease agreement with Crown Golf the Lessee (Crown Golf) owned all the turf maintenance equipment; and WHEREAS, in 2010 and 2011 the City Council approved note issues totaling $200,000 for golf course capital; and WHEREAS, in order to provide continuity of operations the City of Janesville purchased all assets at Riverside and Blackhawk golf courses from Crown Golf, including a fleet of aged turf maintenance equipment; and WHEREAS, the City’s experience over the last year indicates the current fleet of maintenance equipment is experiencing increasing maintenance costs and equipment downtime; and WHEREAS, in order to continue the high maintenance standards Janesville golfers have enjoyed and expect at the municipal courses the City needs to begin a program to replace the maintenance equipment and Riverside and Blackhawk golf courses; and WHEREAS, the 2012 Major Capital Projects Budget anticipated expending $200,000 for Golf Course Capital; and WHEREAS, in order to have replacement equipment available for the start of the mowing season certain capital costs estimated at $250,000 will need to be incurred prior to the 2012 Note Issue NOW, THEREFORE BE IT RESOLVED, by the Common Council of the City of Janesville that they hereby approve and authorize the City Administration to expend funds not to exceed $250,000 for the replacement of turf maintenance equipment at Riverside and Blackhawk golf courses; and BE IT FURTHER RESOLVED by the Common Council of the City of Janesville that is commits to include $200,000 in the 2012 tax exempt obligation promissory note issue for this purpose as permitted by the Internal Revenue Code of 1986. This declaration of official intent is consistent with the budgetary and financial circumstances of the City. The purpose of this Resolution is to satisfy the “official intent” requirement of the Treasury Regulation Section 1.150-2. ADOPTED: Motion by: Second by: APPROVED: Councilmember Aye Nay Pass Absent Dongarra-Adams Eric J. Levitt, City Manager Liebert McDonald ATTEST: Rashkin Steeber Voskuil Jean Ann Wulf, City Clerk-Treasurer APPROVED AS TO FORM: Wald Klimczyk, City Attorney Proposed by: Operations Division Prepared by: Operations Division COMMUNITY DEVELOPMENT DEPARTMENT MEMORANDUM February 13, 2012 TO: Janesville City Council FROM: Gale S. Price, AICP, Manager of Building and Development Services SUBJECT: Action on a Request from Decisions LLC, DBA as Lyfe Lounge and Banquets, (Lyfe) 18-24 River Street, for an Economic Development Grant. Executive Summary In 2002 the City Council adopted an ordinance to establish an Economic Development Grant program to permit the City Council to approve economic grants to those establishments that obtain a Reserve Class B liquor license. Based on specific criteria the City Council may approve such grants up to the one-time $10,000 Reserve Class B liquor license fee. Decisions LLC represented by Donta Evans has requested an Economic Development Grant for their Reserve Class B license which was issued in December, 2011. Committee and Staff Recommendation The Alcohol License Advisory Committee and the Community Development Department recommend that following the City Council review, a motion to approve an Econcomic Development grant in the amount of $10,000 for Decisions LLC, be confirmed. City Manager Recommendation The City Manager concurs with the ALAC and Community Development Department recommendation. Suggested Motion Motion to approve an Economic Devleopment Grant in the amount of $10,000 for Decisions LLC, DBA Lyfe Lounge and Banquets. Request The City Clerks Office has received a written request for a $10,000 Economic Development Grant from Donta Evans, owner of Lyfe which is a resturaunt and bar at 18-24 River Street. The use was issued a Reserve Class B license in December, 2011 and has paid their initial $10,000 Reserve Class B license fee with their application. Background Alcohol licenses are regulated by State Statute Chapter 125 and Janesville Code of General Ordinances Chapter 5. In 1997, the State reduced the number of Class B licenses that a municipality may issue and created a new Reserve Class B alcohol license. A Class B license and a Reserve Class B license are the same except for the cost. A Class B license costs $600 per year and a Reserve Class B license costs $600 per year plus a one-time fee of $10,000 when the license is initially issued. The fees are paid to and retained by the City. Since the enactment of this Reserve Class B license fee, several cities in Wisconsin have created an economic development grant program which in effect refunds all or part of the initial $10,000 fee. In 2002, the City Council adopted an ordinance to establish such an Economic Development Grant Program to allow the City Council to issue a one-time non-repayable grant to businesses who receive a 1 Reserve Class B License. According to the ordinance, after submission by the applicant of a written application to the City Clerk for a grant, the City Council may provide an Economic Development Grant to the licensee in an amount not to exceed $10,000 following a review and recommendation from the Alcohol Licensing Advisory Committee (ALAC). The ordinance further provides that the City Council may consider the following criteria when determining whether to grant all or part of the $10,000 grant to a particular applicant: 1. That the extent to which the license and/or the grant will promote a redevelopment or rehabilitation project in the downtown or other commercial areas including the amount of investment, the extent of rehabilitation, historic preservation and public improvement effectuated, and related revitalization, health, welfare, peace and public good order factors. 2. That the applicant demonstrates that their investment and the establishment issued the Class B reserve intoxicating liquor alcohol beverage license is equal to or greater than the dollar amount of the grant request. 3. That the Class B reserve establishment is located at least 300 feet from any residential-zoned area. Analysis The Community Development Department has evaluated this request based on the above criteria and believes that the entire $10,000 initial license fee should be refunded as a grant. Staff’s findings are based on the following: 1. The property is an existing downtown structure and constitutes a re-use of an existing historic structure as it is included within the West Milwaukee Street Historic District. Re-use of the building promotes preservation of this historic structure. 2. The owner was required to make extensive electrical upgrades to the building to meet current building codes and to facilitate the use. In addition other maintenance and painting was required to upgrade the interior environment and a new sound system for the facility has been implemented. The amount of investment exceeds the $10,000 initial license fee. 3. The establishment is located over 600 feet from property zoned exclusively residential. There is a residential apartment building to the north at approximately 350 feet, but is zoned B6, Central Service District which is a business district, but allows apartment structures in certain instances. The B6 District expects a mix of uses and activities. In Staff’s opinion the use meets the intent of the criteria. The Alcohol License Advisory Committee reviewed this request at their February 7, 2012 meeting and unanimously voted to forward the request to the City Council with a positive recommendation. cc: Eric Levitt Jacob J. Winzenz 2 CITY MANAGER’S OFFICE MEMORANDUM February 13, 2012 TO: Common Council FROM: Wald Klimczyk, City Attorney SUBJECT: Action on a Proposed Resolution Supporting an Amendment to the U.S. Constitution Regarding Corporate Personhood (File Resolution No. 2012 – 880) FACTS : Council Members Rashkin and Liebert requested that the City Administration draft a resolution supporting an amendment to the U.S. Constitution regarding corporate personhood and place it on the next Council agenda. EXECUTIVE SUMMARY : Proposed File Resolution No. 2012-880 calls upon the Congress of the United States to begin the process of amending the Constitution to provide that that corporations are not entitled to the entirety of protections or "rights" of natural persons, specifically so that the expenditure of corporate money to influence the electoral process is no longer a form of constitutionally protected speech, and puts the Common Council of Janesville on record as so supporting. City Manager Recommendation: The City Manager does not have a specific recommendation on this item. The item will not have a staff presentation. SUGGESTED MOTION: I hereby move to adopt Council File Resolution No. 2012-880. DISCUSSION : By adopting the attached Resolution, the Common Council of the City of Janesville would on the record oppose the U.S. Supreme Court’s interpretation of the Constitution in Citizens United v. Federal Election Commission, 130 S. Ct. 876 (2010) (“Citizens United”) where the United States Supreme Court on January 21, 2010,by a 5- 4 vote, issued its decision in Citizens holding that independent spending on elections by corporations and other groups could not be limited by government regulations, and puts the Janesville Common Council on record opposing the constitutional rights of corporations and supporting amending the Constitution accordingly. Council Members Yuri Rashkin and Samuel Liebert, sponsored this item and contend that the decision in Citizens United rolled back the legal restrictions on corporate spending in the electoral process, allowing for unlimited corporate spending to influence elections, candidate selection, and policy decisions. 1 City Comparisons Madison and Dane County voters approved resolutions via ballot initiative in support of a similar personhood resolution; however, staff is unaware of any Wisconsin municipal governing bodies that have approved a personhood resolution. The Cities of Duluth, MN; Buffalo, NY; Portland, OR; Los Angeles, CA; and New York City, NY governing bodies approved similar personhood resolutions to what is before the Council. (source: http://movetoamend.org/resolutions-map) Attachment (proposed File Resolution No. 2012-880). 2 CITY OF JANESVILLE RESOLUTION NO. 2012 - 880 A Resolution calling for a U.S. Constitutional amendment to abolish corporate personhood. Specifically: A Resolution opposing the United States Supreme Court's interpretation of the Constitution in Citizens United regarding the constitutional rights of corporations, supporting an amendment to the Constitution to provide that corporations are not entitled to the entirety of protections or "rights" of natural persons, specifically so that the expenditure of corporate money to influence the electoral process is no longer a form of constitutionally protected speech, and calling on Congress to begin the process of amending the Constitution. Whereas, This Common Council is the governing body of the City of Janesville, a Wisconsin municipal corporation, located in the County of Rock, conducting its principal business at 18 North Jackson Street, Janesville, WI 53545, and are in charge of the business of the City under the Home Rule provisions of the Wisconsin Constitution, Article XI Section 3, and pursuant to Sections 66.0101 and 62.11(5) of the Wisconsin Statutes; and Whereas, Article V of the Constitution of the United States of America prescribes how an amendment can become a part of the U.S. Constitution, reading as follows: “The Congress, whenever two thirds of both Houses shall deem it necessary, shall propose Amendments to this Constitution, or, on the Application of the Legislatures of two thirds of the several States, shall call a Convention for proposing Amendments, which, in either Case, shall be valid to all Intents and Purposes, as part of this Constitution, when ratified by the Legislatures of three fourths of the several States, or by Conventions in three fourths thereof, as the one or the other Mode of Ratification may be proposed by the Congress; Provided that no Amendment which may be made prior to the Year One thousand eight hundred and eight shall in any Manner affect the first and fourth Clauses in the Ninth Section of the first Article; and that no State, without its Consent, shall be deprived of its equal Suffrage in the Senate.”; and Whereas, While there are two ways, only one has ever been used. All twenty seven (27) Amendments have been ratified after two-thirds of the House and Senate approve of the proposal and send it to the states for a vote. Then, three-fourths of the states must affirm the proposed Amendment. The other method of passing an amendment requires a Constitutional Convention to be called by two-thirds of the legislatures of the States. That Convention can propose as many amendments as it deems necessary. Those amendments must be approved by three-fourths of the states; and Whereas, On January 21, 2010, the United States Supreme Court, by a 5-4 vote, issued its decision in Citizens United v. Federal Election Commission, 130 S. Ct. 876 (2010) (“Citizens United”), holding that independent spending on elections by corporations and other groups could not be limited by government regulations; and Whereas, The decision in Citizens United rolled back the legal restrictions on corporate spending in the electoral process, allowing for unlimited corporate spending to influence elections, candidate selection, and policy decisions; and Whereas, In reaching its decision, a majority of the Supreme Court, relying on prior decisions, interpreted the First Amendment of the Constitution to afford corporations the same free speech protections as natural persons; and Whereas, The Court's decision in Citizens United severely hampers the ability of federal, state, and local governments to enact reasonable campaign finance reforms and regulations regarding corporate political activity; and Whereas, Corporations should not be afforded the entirety of protections or "rights" of natural persons, such that the expenditure of corporate money to influence the electoral process is a form of constitutionally protected speech; and Whereas, Several proposed amendments to the Constitution have been introduced in Congress that would allow governments to regulate the raising and spending of money by corporations to influence elections; and Whereas, The only way to reverse these rulings is an amendment to the Constitution of the United States that: A. Ends the judicial fiction of corporate Constitutional rights. B. Requires Congress to regulate campaign finance. C. Mandates public financing of public elections.; and Whereas, Numerous other cities throughout the United States including, but not limited to, Los Angeles, CA, New York, NY, Duluth, MN, Portland, ME, Portland, OR, and Pueblo, CO, have each adopted similar resolutions NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of Janesville that: 1. Each and every of the above recitals is reiterated and incorporated by reference herein into these empowerment provisions; and 2. The Common Council of the City of Janesville oppose the U.S. Supreme Court’s interpretation of the Constitution in Citizens United regarding the constitutional rights of corporations, and supports amending the Constitution to provide that corporations are not entitled to the entirety of protections or "rights" of natural persons, specifically so that the expenditure of corporate money to influence the electoral process is no longer a form of constitutionally protected speech, and hereby specifically call on Congress to begin the process of amending the Constitution; and BE IT FURTHER RESOLVED , that the City Manager and his designee(s), on behalf of the City of Janesville, is/are hereby jointly and severally authorized and empowered to take whatever additional actions that the City Manager may determine in his sole discretion, from time to time and at any time, necessary and/or desirable in the public interest to effectuate the intent of this Resolution. ADOPTED: MOTION BY: APPROVED: SECOND BY: COUNCILMEMBER AYE NAY PASS ABSENT Eric Levitt, City Manager ATTEST: DONGARRA-ADAMS Jean Ann Wulf, City Clerk-Treasurer LIEBERT McDONALD APPROVED AS TO FORM: RASHKIN STEEBER Wald Klimczyk, City Attorney VOSKUIL Proposed by: Council Members Rashkin and Liebert Prepared by: City Attorney CITY MANAGER’S OFFICE MEMORANDUM January 30, 2012 TO: City Council FROM:Rebecca Smith, Management Assistant SUBJECT: Action on a Proposed Council Policy Establishing Term Limits for City Councilmembers serving on Boards, Commissions and Committees (Council Policy No. 90) Request Councilmember Rashkin requested staff bring forward a policy to implement term limits for Councilmember service on boards, commissions and committees. This item was brought forward in 2011and was scheduled to be discussed in 2012. Staff Recommendation Staff sees this decision as policy of the Council and has no recommendation. If the Council wishes to approve Council Policy No. 90, the Council should choose one of the two shaded sentences on page 2 of the policy for inclusion. City Manager Recommendation There is no recommendation on the item. The potential policy attempts to define the term limits as the time when a Council member is serving on the Council and does not include time served on a specific commission as a non-Council member. Suggested Motion Text I move to approve Council Policy No. 90 to implement term limits for Councilmember service on boards, commissions and committees. The Council may also wish to provide direction on whether a charter ordinance regarding term limits for citizen board, commission and committee members be brought forward for Council review. Background Information At the second meeting of April each year the Council President appoints Councilmembers to those boards, commissions and committees in which Councilmembers serve. The appointments are for one year in length (May 1-April 30). There is currently no limit as to the number of years a councilmember may serve on a board, commission or committee. Council Policy No. 90 Council Policy No. 90 outlines new regulations concerning term limits for Councilmembers to serve on boards, commissions and committees. Highlights include the following: 1. Councilmembers continue to be appointed annually by the Council President at the second meeting of April. Appointments continue to be for one year (May 1- April 30). 2. Term limits for Councilmembers to serve on Boards, Commissions and Committees shall be equal to the term limits for citizen members on each respective board, commission or committee. For example, if a citizen member may serve two, three-year terms, Councilmembers may also serve a total of six years. 3. For committees that are not organized by the City of Janesville, such as the Downtown Development Alliance, Councilmembers may serve following the policy of the organization. If no term limit is imposed by the organizing group, there shall be no term limit for service on that board, commission or committee. 4. The Janesville Metropolitan Planning Organization Policy Board is exempt from this policy statement because all Councilmembers serve on this Board. 5. Years of service on a board, commission or committee do not need to be consecutive to count toward the maximum number of years. 6. If a councilmember has a break in their service as a councilmember (resigns from council, chooses not to run for office, etc.), their number of years of committee service reverts to zero. This means that if the former Councilmember was re-elected to council, their years of service on boards, commissions and committee would be zero for the purpose of determining term limits. 7. Time served as a citizen member on a board, commission or committee is excluded when determining years of service. This means that if a Councilmember volunteered for a committee prior to being elected, those years of service are excluded from the term limit regulations. 8. If a Councilmember is appointed to a board, commission or committee outside of the normal April process, such as to fill a mid-year vacancy or to serve on a newly formed committee, that portion of a year’s service shall be excluded when determining years of service. 9. This policy is effective April 1, 2012. Council will need to determine whether to exclude or include current and past years of service. Proposed Regulations Table 1 depicts the committees in which Councilmembers serve, the number of Councilmembers that serve on each committee, the term length for citizen members, the number of terms citizen members may serve and the proposed number of years a Councilmember may serve under proposed Council Policy No. 90. There are eleven committees in which Councilmembers serve. Council Policy No. 90 proposes:  Six committees would allow Councilmembers to serve 6 years;  Two committees would allow Councilmembers to serve 4 years;  Two would not include term limits; and  One committee would allow for nine years of service. Table 1: Councilmember Term Limit Information COJ organized Committees How many terms Proposed Maximum # of years Committee in which # of How long is a can citizen a councilmember may serve Councilmembers Councilmembers citizen member members under proposed Council Servethat serveterm? (years)served?Policy No. 90 Alcohol Licensing Advisory1 3See note below6 Cable Advisory1 3See note below6 Comm Development Authority2 414 Ice Skating Center Advisory1 3See note below6 Leisure Advisory1 3See note below6 Plan Commission2 326 Sustainable Janesville1 2See note below4 Transportation Committee1 3See note below6 Appointed annually by Council President; No citizens serve; taxing entities TIF District select No term limit for representative1representativerepresentatives No term limit Non-COJ organized committees Proposed Maximum # of years Committee in which # of a councilmember may serve Councilmembers Councilmembers How long is a Councilmember under proposed Council Servethat serveterm?Policy No. 90 Appointed annually by Council President; Bylaws indicate Council Community Action representative serves at the pleasure Board representative1 of their appointing authorityNo term limit Appointed annually by Council Downtown President; Bylaws allow for 3, three Development Alliance2Per their bylaws, 9 years year terms, thus 9 years. Notes: Janesville MPO is not included because all councilmembers serve on this committee. The number of terms a citizen may serve on committees appointed by the city manager is determined by charter ordinance 2.04.160. There are no references to term limits for Council President appointments; therefore, there are no term limit requirements for those committees appointed by the Council President. Historically, Council President appointments have followed the guidelines set in Charter ordinance 2.04.160. Peer City Comparison Staff completed a peer city survey to understand the regulations concerning term limits in other communities, as outlined in Table 2. Table 2: Peer City Comparison Is there a maximum number Do Councilmembers of years/terms a serve on boards, How many years Councilmember may serve commissions and is an on a board, commission or Peer Citycommittees?appointment?committee? AppletonYes2 Years No BeloitYes1 Year No Eau ClaireYes1 Year No Fond du LacYes1 Year No Green BayYes2 Years No KenoshaYes2-5yrs No ManitowocYes2 Years No OshkoshYes1 Year No RacineYes 1,2, or 3 Years No SheboyganYes1 or 2 Years No WaukeshaYes1 Year No WausauYes2 Years No JANESVILLEYes1 yearNo Of the twelve cities surveyed, all 12 (100%) have Councilmembers serving on boards, commissions or committees; this is the same as Janesville. The number of years that a Councilmember is appointed to serve on a committee varies, with most ranging from 1-2 years; this is similar to Janesville’s approach of one year terms. All 12 (100%) do not regulate the maximum number of years that a Councilmember may serve on a board, commission or committee. Cities stated that once one appointment is completed, Councilmembers may be appointed again. The peer cities’ approach is the same as Janesville current approach; if the Council implements Council Policy No. 90, Janesville’s approach would be dissimilar to our peers. Pros & Cons to implementing term limits for Councilmembers on Boards, Commissions and Committees Pros 1. Allows different Councilmembers to serve, thus possibly leading to varied perspectives 2. Provides consistency in length of service between citizen members and Councilmembers Cons 1. Councilmembers may be appointed to a committee not in their field of interest or knowledge because there may not be many options for appointment, particularly if other Councilmembers personally exclude themselves from certain committees due to scheduling conflicts 2. Committees working on long term or complicated projects/topics may prefer the consistency of having a Councilmember serve for several years Analysis Limiting years of service of Councilmembers on boards, commissions and committees is a new topic for the Council and one that has not been implemented in peer cities. Should the Council wish to begin term limits for Councilmember committee service, Council Policy No. 90 outlines regulations to implement this change. As noted in Table 1, there is no official term limit for citizen members appointed by the Council President. Staff has historically used the regulations from charter ordinance 2.04.160 governing citizen members appointed by the City Manager. The Council may wish to have a charter ordinance brought forward to solidify the regulations concerning citizen members appointed by the Council President. Charter ordinance 2.04.160 Charter ordinance 2.04.160 (attached) details the limitation of terms for those citizens recommended by the City Manager. This ordinance states:  If a term length is 3 years or less, a volunteer may serve up to 2 consecutive terms;  If a term length is more than 3 years, a volunteer may serve 1 term. This ordinance also provides an exception that would allow the manager to appoint a volunteer to one additional term if the person was deemed to have unique knowledge or a critical capacity with an unfinished committee project. Historically, this exception has not been used. CITY OF JANESVILLE Policy No. 90_ CITY COUNCIL POLICY STATEMENT Date Issued General Subject: Administration Effective Date 4/1/2012 Special Subject: Councilmember Term Limits for Boards, Commissions and Committees Cancellation Date Supersedes No. PURPOSE The objective of this policy is to outline the term limit regulations concerning Councilmembers’ service on boards, commissions, committees. STATEMENT OF POLICY Appointment Councilmembers continue to be appointed annually by the Council President at the second meeting of April. Appointments continue to be for one year in length (May 1- April 30). Term Limit Regulations Term limits for Councilmembers to serve on Boards, Commissions and Committees shall be equal to the term limits for citizen members on each respective board, commission or committee. For example, if a citizen member may serve two, three-year terms, Councilmembers may also serve a total of six years. For committees that are not organized by the City of Janesville, such as the Downtown Development Alliance, Councilmembers may serve following the policy of the organization. If no term limit is imposed by the organizing group, there shall be no term limit for service on that board, commission or committee. If a councilmember has served the maximum amount of time on a board, commission or committee, he or she must wait two (2) years before being able to serve on that board, commission or committee again. The Janesville Metropolitan Planning Organization Policy Board is exempt from this policy statement because all Councilmembers serve on this Board. Years of Service Years of service on a board, commission or committee do not need to be consecutive to count toward the maximum number of years. If a councilmember has a break in their service as a councilmember (resigns from council, chooses not to run for office, etc.), their number of years of committee service reverts to zero. This means that if the former Councilmember was re-elected to council, CITY OF JANESVILLE Policy No. 90_ CITY COUNCIL POLICY STATEMENT Date Issued General Subject: Administration Effective Date 4/1/2012 Special Subject: Councilmember Term Limits for Boards, Commissions and Committees Cancellation Date Supersedes No. their years of service on boards, commissions and committee would be zero for the purpose of determining term limits. Time served as a citizen member on a board, commission or committee shall be excluded when determining years of service. This means that if a Councilmember volunteered for a committee prior to being elected, those years of service are excluded from these term limit regulations. If a Councilmember is appointed to a board, commission or committee outside of the normal April process, such as to fill a mid-year vacancy or to serve on a newly formed committee that portion of a year’s service shall be excluded when determining years of service. This policy is effective April 1, 2012. Councilmember service on boards, commissions and committees prior to April 1, 2012 are excluded from these term limit regulations. OR Councilmember service on boards, commissions and committees prior to April 1, 2012 are included in these term limit regulations. Comment [rs1]: Council should choose one of these sentences for inclusion in the policy. CITY MANAGER’S OFFICE MEMORANDUM January 13, 2012 TO: City Council FROM:Rebecca Smith, Management Assistant SUBJECT: Action on dissolution of the Ice Skating Center Advisory Committee and the Cable Advisory Committee Request The Acting Recreation Director requests the Council approve the dissolution of the Ice Skating Center Advisory Committee. The Library Director requests the Council approve the dissolution of the Cable Advisory Committee. Staff Recommendation Considering the difficulty in obtaining quorums for these committees and the other options available for garnering feedback, staff recommends the Council dissolve the Ice Skating Center Advisory Committee and the Cable Advisory Committee. City Manager Recommendation If the Council determines it best not to dissolve one or both committees, I recommend that we may want to look at the structure and mission of the committees and determine any necessary changes. Recreation Recommendation The Acting Recreation Director recommends the Council approve the dissolution of the Ice Skating Center Advisory Committee. Library Recommendation The Library Director recommends the Council approve the dissolution of the Cable Advisory Committee. Suggestion Motion I move to dissolve the Ice Skating Center Advisory Committee and the Cable Advisory Committee. Ice Skating Center Advisory Committee Background The Ice Skating Center Advisory Committee was established in 1979 and was modified in 1997. This committee was very helpful when the operations of the ice skating center were managed by an outside company; however, with city staff managing the center, the operations are stable. In April 2008 the committee was dissolved due to lack of attendance, thus leading to an inability to meet because there was not a quorum for meetings. When the committee was dissolved, the Council approved staff’s recommendation to add an additional member to the Leisure Services Advisory Committee (LSAC) to represent the ice skating community. 1 In August of 2009 the Council chose to reinstate the advisory committee; however, the ice skating community representative remained on the Leisure Services Advisory Committee. Since reinstating the committee, staff has experienced significant difficulties in obtaining a quorum for meetings of the Ice Skating Center Advisory Committee. In 2011, staff scheduled 6 meetings; 2 of those were held with a quorum of members present, while the remaining 4 were cancelled due to lack of attendees. Leisure Services sent a letter to committee members in December 2011 indicating staff’s intent to bring the dissolution forward and to date has received no comments. Should the council approve staff’s recommendation to dissolve the Ice Skating Center Committee, staff would take items requiring feedback to the Leisure Services Advisory Committee and in fact, has already done so in at least one occasion already. Cable Advisory Committee Background The Cable Advisory Committee was established in August 1993 and four years later public access television began broadcasting. While the Committee was very helpful during the infancy stages of the public access channel, the operations are now very stable. In addition, local franchises lost much of their control to the state when the Video Competition Act (known as Act #42) took effect in 2008. This diminished the role and responsibility of the Cable Advisory Committee. Since then it has been difficult to find dedicated members to serve on the committee, and the situation is not unique to Janesville as many cities throughout the state have disbanded their Cable Advisory Committees. In addition, those that are most interested in the station prefer to volunteer as a camera operator or as a Friends member, rather than serve on a committee. The Committee has met twice in the last year, in comparison to the typical six meetings per year, due to an inability to obtain interest and a quorum for meetings. The Library Director discussed this subject with the Hedberg Public Library Board of Trustees and they welcome the opportunity to serve as a policy making and oversight board for JATV. JATV and library staff can be assured that if a topic requires feedback, the Library Board would be meeting in a timely fashion to provide the necessary review. Pros & Cons to Dissolving these Committees Pros 1. Saves staff time in trying to administer committees where quorums are routinely difficult to obtain 2. There are other mechanisms in place that can be counted on for garnering feedback – Leisure Services Advisory Committee for the Ice Center and the Library Board for JATV 3. Being part of a committee that can’t be depended on to meet regularly may over time disenfranchise interested members from wishing to attend future meetings or to volunteer with the City in general 2 Cons 1. Any members that are willing to attend meetings would no longer be able to continue their service on the committee being dissolved Analysis These committees are not functioning properly due to a lack of interest/attendance and, thus, an inability to obtain a quorum. There are other mechanisms in place to obtain citizen feedback - Leisure Services Advisory Committee for the Ice Center and the Library Board for JATV thus, continuing to provide an outlet garner feedback when necessary. There are also ways for any existing committee members to be involved in the future if they so desire, such as volunteering with the Leisure Services Department, becoming a ‘Friend’ of JATV or completing a Volunteer Interest Form. Existing committee members would also be able to volunteer to serve on any other city boards, commissions or committees of interest to them. CC: Eric Levitt, City Manager Jacob J. Winzenz, Assistant City Manager Bryan McCormick, Library Director Shelley Slapak, Acting Recreation Director 3 POLICE DEPARTMENT MEMORANDUM 01/27/2012 TO: City Council FROM: Police Chief David J. Moore SUBJECT: Introduce and Schedule a Public Hearing on a proposed Ordinance Amending Janesville’s Parking Penalties (File Ord 2012-509) Background During the budget discussions for the 2012 city budget, staff recommended and the City Council discussed the increase of parking fines as a revenue source. The City Council discussed the following increases in the parking fines: Parking ticket fees are proposed to increase 50%, from $10 to $15, and from $20 to $30 except for:  A ticket for parking on the street during a snow emergency is proposed to increase from $20 to $50;  A ticket for parking within 10 feet of a fire hydrant is proposed to increase from $20 to $50; and  A ticket for parking in a handicapped parking stall is proposed to increase from $40 to $120. Executive Summary After the police department’s budget session on October 18, 2011, City Council requested that a survey be conducted to determine what our peer cities charge for parking violations. Twenty-one parking ticket violations were included in the survey. Eight out of thirteen agencies responded. The eight agencies that responded were; Eau Claire, Fond du Lac, Green Bay, Kenosha, Lacrosse, Oshkosh, Waukesha, and Wausau. Analysis It was determined that City of Janesville parking ticket fees are lower than our peer cities. Below is a chart showing the comparison taking an average of the eight agencies surveyed including Janesville. In addition, it was determined that four out of the nine agencies included in this survey currently have parking meters installed. 1 Staff Recommendation The police department recommends the city council approves Ordinance No. 2012-509. City Manager Recommendation Based on Council direction during the budget, the City is forwarding an Ordinance that will increase parking fines by 50% with the exception of handicap parking, snow emergency parking and fire hydrant parking. These fees will be increased by greater than 100% due to the public safety nature of these categories. cc: Eric Levitt, Jay Winzenz, Wald Klimczyk, David Moore 2 ORDINANCE NO. 2012 - 509 An ordinance amending Janesville parking penalties. THE COMMON COUNCIL OF THE CITY OF JANESVILLE DO ORDAIN AS FOLLOWS: SECTION I. Section 10.40.170 of the Code of General Ordinances of the City of Janesville is hereby renumbered, amended, and in part re-created to read as follows: “10.40.170 Violation—Penalty A. Any person who violates Section 10.40.020 G. 9 parking within ten (10) feet of a fire hydrant shall pay a forfeiture to the City of fifty dollars ($50). B.Any person who violates any provision of Section 10.40.040 A. or C. or Section 10.40.090, except Section 10.40.040 A.6, shall pay a forfeiture to the City of ten fifteen dollars ($15). C.Any person who violates Section 10.40.040 A.6. regarding parking in a leased stall shall pay a forfeiture to the City of twenty thirty dollars ($30). The police department shall accept ten dollars to satisfy such a violation if paid within five working days of issuance of the parking ticket. D.Any person who violates Section 10.40.040 B. regarding parking in handicap parking stalls and spaces shall pay a forfeiture to the City of one hundred twenty dollars ($120). E.Any person who violates Section 10.40.080 (parking during and after snowstorms) shall pay a forfeiture to the City of twenty fifty dollars ($50). F.Any person who violates any provision of this chapter and who fails to pay a twenty thirty dollar ($30) parking ticket to the City within five (5) working days of issuance of the ticket shall forfeit and pay to the City ten fifteen dollars ($15) in addition to the twenty thirty dollar ($30) parking ticket forfeiture.” G.Any person who violates any provision of this chapter for which a different penalty is not otherwise specified shall, upon conviction, be subject to a forfeiture of not less than twenty thirty dollars ($30) nor more than two three hundred dollars ($300), together with the costs of prosecution, and in default of payment thereof, shall be imprisoned in the Rock County Jail for a period of not more than sixty (60) days. (Ord. 84-417 s. 1--3, 1985; Ord. 83-335 s. 1(part), 1983).” SECTION II . Section 10.44.070 of the Code of General Ordinances of the City of Janesville is hereby amended to read as follows: “10.44.070 Violation—Penalty Any person who violates any provision of this chapter [general public parking lot regulations] shall upon conviction be subject to a forfeiture of not less than twenty thirty dollars ($30) nor more than one hundred fifty dollars ($150), together with the costs of prosecution, and in default of payment thereof, shall be imprisoned in the Rock County Jail for a period of not more than thirty (30) days. (Ord. 83-335 s. 1(part), 1983).” ADOPTED: Motion by: Second by: APPROVED: Councilmember Aye Nay Pass Absent Dongarra-Adams Liebert Eric J. Levitt, City Manager McDonald Rashkin ATTEST: Steeber Voskuil Jean Ann Wulf, City Clerk-Treasurer APPROVED AS TO FORM: Wald Klimczyk, City Attorney Proposed by: Common Council Budget Prepared by: City Attorney