RESOLUTION 1999-07
 
CITY OF GRANT,
WASHINGTON COUNTY, MINNESOTA
 
A RESOLUTION OF THE CITY OF GRANT, WASHINGTON COUNTY, MINNESOTA, AUTHORIZING THAT A "CERTIFICATE
OF DEFAULT" BE DELIVERED TO NORWEST BANK DRAWING ON LETTER OF CREDIT NO. S406084 REGARDING PUBLIC
IMPROVEMENTS ON INGBERG CIRCLE NORTH.
 
WHEREAS, the City of Grant entered into a "Road Construction Agreement" on October 13, 1998, with Neal Linnihan and Michelle
Linnihan, husband and wife; and,
 
WHEREAS, that Road Construction Agreement required the Linnihans to construct Ingberg Circle North, including all necessary
grading, road preparation and drainage work.  All work was to be done subject to the approval of the City in accordance with City
standards and requirements; and,
 
WHEREAS, the Road Construction Agreement also provided that the road would be completely finished no later than August 31, 1999;
and,
 
WHEREAS, as and for security to insure completion of the road in a timely manner, the Linnihans have posted a financial guarantee in
the form of a Letter of Credit with the City.  That Letter of Credit was drawn on Norwest Bank Minnesota, National Association,
Roanoke Building, Fifth Floor, 109 South Seventh Street, Minneapolis, Minnesota 55479-0093.  The Letter of Credit Number is
5406084; and,
 
WHEREAS, by Memorandum dated September 9, 1999, the City's Engineer has informed the Council that a variety of items still need
to be completed in order to have the road accepted by the City.  See the Engineer's Memorandum attached hereto as Exhibit "A"; and,
 
WHEREAS, the Engineer's Office has estimated that it will cost Five Thousand Dollars ($5,000.00) to complete the work specified on
his Memorandum; and,
 
WHEREAS, the City's Treasurer has informed the City that the Linnihans are also in default of paragraph one (1) of the Road
Construction Agreement.  Specifically, their escrow account has fallen below the required amount.  It will require approximately
$2,400.00 to bring it back up to its required amount; and,
 
WHEREAS, the Letter of Credit that the City is holding expires on October 1, 1999.
 
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Grant as follows:
 
1. That the City Staff is hereby directed to draw on the Letter of Credit in the amount of Seven Thousand Four Hundred Dollars
($7,400.00) to insure completion of the items listed on the Engineer's Memorandum and to restore the escrow account.
 
2. That the Letter of Credit itself requires a specific statement in order to draw the Letter of Credit and, accordingly, this Resolution
expressly states as follows:
 
             WE ARE DRAWING AGAINST STANDBY LETTER OF CREDIT NO. 5406084 AS NEAL LINNIHAN AND
             MICHELLE LINNIHAN (THE "LINNIHANS") HAVE FAILED TO COMPLETE THE CONSTRUCTION OF
             INGBERG CIRCLE NORTH PER THE APPROVED PLANS AND SPECIFICATIONS AND ARE IN DEFAULT
             UNDER THE TERMS AND CONDITIONS OF THE ROAD CONSTRUCTION AGREEMENT BETWEEN THE
             CITY OF GRANT AND THE LINNIHANS, AND THE CITY OF GRANT IS ENTITLED TO THE UNRELEASED
             PORTION OF THIS STANDBY LETTER OF CREDIT.
 
3. That City Staff is hereby directed to hand deliver an original copy of this Resolution to:
 
Norwest Bank Minnesota, National Association
Roanoke Building, Fifth Floor
109 South 7th Street
Minneapolis, Minnesota 55479-0093
 
Adopted by the City Council of the City of Grant this 22nd day of September, 1999.
 
Gary Erichson, Mayor
 
ATTEST:
Stephanie J. Marty, City Clerk