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