HomeMy WebLinkAboutRes1985-092
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CITY OF SEWARD, ALASKA
RESOLUTION NO. 85- 92
A RESOLUTION OF THE CITY COUNCIL OEP~HE CITY
OF SEWARD, ALASKA, AUTHORIZING THE EXECUTION
OF A TRANSFER OF RESPONSIBILITIES AGREEMENT
AND A PROJECT MANAGEMENT SERVICES AGREEMENT
BY AND BETWEEN THE CITY AND THE STATE OF
ALASKA; AND RELATED MATTERS.
WHEREAS, the City of Seward, Alaska (the "City") is a
home rule city and under Section 11 of Article of the Alaska
Constitution may exercise all legislative power not prohibited by
law or by the Charter of the City, and it has been determined
that the matters set forth in this Resolution are not prohibited
by law or the Charter; and
WHEREAS, the City is the owner of certain premises
described herein, known as the Spring Creek Correctional Facility
Site which it desires to lease to the State of Alaska so that the
State can use, operate and maintain a correctional facility on
said premises;
WHEREAS, the State is legally authorized to enter the
lease of said premises, and the Alaska Legislature has stated its
intention to appropriate lease payments for the lease of the
facility, when constructed by the City, to the State of Alaska
under various enactments of the First Session of the Fourteenth
Alaska Legislature; and
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CITY OF SEWARD, ALASKA
RESOLUTION NO. 85- 92
Page 2.
WHEREAS, the City considers that the construction,
equipping and leasing to the state of said correctional facility
and the financing of the same will promote the public purposes of
the City; and
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WHEREAS, there have been presented to the City the form
of the following documents which the City proposes to enter into
in connection with the construction and financing of the proposed
facility:
1. The Form of the Transfer of Responsibilities
Agreement ("TORA") between the City and the State of Alaska;
and
2. The Form of the Project Management Services
Agreement (the "Managment Agreement") between the City and
the State of Alaska.
WHEREAS, it appears that each of the instruments above
referred to, which are now before the City, is in appropriate
form and is an appropriate instrument for the purposes intended;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY, AS FOLLOWS:
Section 1. That the form and content of the TORA and
the Management Agreement be and the same hereby are in all
respects authorized, approved and confirmed, and the Mayor,
Manager or Assistant City Manager be and each hereby is
authorized, empowered and directed to execute and deliver the
TORA and the Management Agreement to the State for and on behalf
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CITY OF SEWARD, ALASKA
RESOLUTION NO. 85-~2
Page 3.
of the City including necessary counterparts, in substantially
the form and content now before this meeting but with such
changes, modifications, additions and deletions therein as shall
to them seem necessary, desireable or approp~ate, the execution
thereof to constitute conclusive evidence of the approval of any
and all changes, modifications, additions or deletions thereon
from the form and content of the TORA and Management Agreement
now before this meeting, and that, from and after the execution
and delivery of the TORA and Management Agreement, the Mayor,
Manager, Assistant City Manager and the Clerk of the City are
hereby authorized, empowered and directed to do all such acts and
things and to execute all documents as may be necessary to carry
out and comply with the provisions of the TORA and Ma~agement
Agreement as executed.
Section 2. That the Mayor, Manager, Assistant City
Manager and the Clerk of the City or any other person authorized
by the City be and each hereby is authorized to execute and
deliver for and on behalf of the City any and all additional
certificates, documents, opinions or other papers and perform all
other acts as they may deem necessary or appropriate in order to
implement and carry out the intent and purposes of this
Resolution.
Section 3. That the provisions of this Resolution are
hereby declared to be separable and if any section, phrase or
provision shall for any reason be declared to be invalid such
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CITY OF SEWARD, ALASKA
RESOLUTION NO. 85-~2
Page 4.
declaration shall not affect the validity of the remainder of the
sections, phrases or provisions.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
SEWARD, ALASKA, this 19th day of August, 198~~
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
(City Seal)
THE CITY OF SEWARD, ALASKA
Gillespie, Meehan,
None
Cripps, Hi! ton
None
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Michael J. Meehan, Vice-Mayor
Scholl, Simutis, Williams
APPROVED AS TO FORM:
HUGHES, THORSNESS, GANTZ, POWELL
AND BRUNDIN, Attorneys for the
City of Seward, Alaska
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Fred B. Arvidson
City Attorney
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Project Name Spring Creek
Correctional Center
Project No. RI0294
T~~SFER OF RESPONSIBILITIES AGREEMENT
BETWEEN
THE STATE OF ALASKA DEPARTMENT OF
TRANSPORTATION AND PUBLIC FACILITIES
AND
CITY OF SEWARD
. This Agreement, effective upon execution by the State
of Alaska, Department of Transportation and Public Facilities
(hereinafter called the State) and the City of Seward (herein-
after called the Municipality). The State and the Municipality
are entering into this Agreement pursuant to AS 35.15.080 et.
seg. and any regulations promulgated thereunder.
The Municipality's coordinator for this Agreement is
Everett P. Diener. The State's coordinator for this Agreement is
Margaret E. Holland. Each party agrees to notify the other party
of any change in the coordinator.
Whereas funds have been appropriated by the Legis-
lature, under Chapter 107/SLA 83, Page 81, Line 9, and Chapter
171/SLA 84, Page 59, Line 19, for the project described in
Appendix A of this Agreement and whereas the Municipality has
submitted a resolution to the State requesting that the MUni-
cipality be allowed to assume all responsibility for the con-
struction of the project described in Appendix A (hereinafter
alsol~ferred to as "the Project"), the parties mutually agree as
follows:
1. Except as provided in the Project
Management Services Agreement between the Municipality
and the State. the Municipality agrees to assume all
responsibilities heretofore held by the State relating
to the planning and construetion of the project des-
cribed in Appendix A which is hereby incorporated and
made a part of this Agreement.
2. The Municipality agrees to comply with
all applicable codes, statutes, and regulations of the
State of Alaska.
Project Name Spring Creek
Cerrce:1:iol.a.ca.l Ce::uLe-r
Project No. R10294
3. The State agrees to transfer a portion
of the funds appropriated by the Legislature for the
project to a special account in the State Treasury and
shall immediately retransfer said funds to the Con-
struction Fund held by the Trustee under the Trust
Indenture and Assignment of Lease dated as of September
1, 1~8!2__!2E!t~e~.ILtheMunicipali tY_~I1-d,R~~n_i~r National
Bank, as Trustee (hereinafter referred to as the
"Indenture"). The funds transferred to the Construc-
tion Fund for the Municipality shall not exceed a total
of fifteen million three hundred seven thousand three
hundred forty-nine dollars ($15,307,349.00).
4. Funds shall be drawn from the Construc-
tion Fund described in Paragraph 3 only in accordance
with the Indenture.
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5. Prior to the advertisement for bids, the
Municipality must obtain the State's approval of the
land interest in the project site pursuant to AS
35.15.110. The Municipality agrees not to advertise
for bids for the project or enter into contract nego-
tiations concerning the project until such approval by
the State is forthcoming.
6. Except as provided in the Project
Management Agreement between the Municipality and the
State, the Municipality agrees to indemnify and hold
harmless the State of Alaska and its agents and em-
ployees from and against any and all claims, damages,
losses, and expenses arising out of the Municipality's
assumption of the responsibilities for the planning and
construction of the project set forth and described in
Appendix A.
7. The Municipality shall coordinate all
regulatory agency reviews and obtain all necessary
written approvals from all regulatory agencies.
8. The Municipality has the duty of provid-
ing for and overseeing all safety orders, precautions,
and programs necessary to ensure the reasonable safety
for the planning and construction of the project. In
this connection, the Municipality shall take reasonable
precautions for the safety of all project employees and
all other persons whom the project might affect, and
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TRANSFER OF RESPONSIBILITIES
AGREEMENT
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Project Name Spring Creek
Correctional Center
Project No. R10294
shall inspect all work and materials incorporated into
the project, and all property and improvements on the
construction site and adjacent thereto.
9. The Municipality shall submit a quar-
terly status and expenditure report to the State. The
first report shall be due three months after receipt by
the Municipality of the fully executed Agreement, and
subsequent reports shall be due every three months
thereafter until Project completion.
10. The Municipality, upon completion of the
project, shall provide the State with a final expendi-
ture report, certified by the Municipality, of all
costs incurred in the accomplishment of the Project.
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11. The Municipality, upon completion of the
Project, shall have performed an independent audit
according to Appendix B. The audit shall be performed
and delivered to the State within 120 days of the end
of the calendar year in which the Project was com-
pleted. The State retains the right to audit the
Project any time within three (3) years upon written
notice to the Municipality. All Project records shall
be maintained by the Municipality for three (3) years
after the date of Project acceptance.
12. Subject to Section 4.03 of the Inden-
ture, within sixty (60) days of the issuance of a final
Gudit report by the State or sixty (60) days after
~cceptance by the State that the Municipality has met
the requirements of this Agreement, the Municipality
will return the full amount of the grant, less
legitimate Project expenses, to the State of Alaska.
13. Responsibility for the maintenance and
operation of the Project shall be governed by the
Agreement of Lea.se between the Municipality and the
State of Alaska, Department of Corrections dated as of
October 1. 1985 (hereinafter referred to as the
"Lease")..
14. If the Municipality cannot perform its
obligations under this ~greement because of any cause
beyond its control, including, without limitation, any
cause set forth in Section 2.01 of the Lease, or the
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TRANSFER OF RESPONSIBILITIES
AGREEMENT
Page 3.
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Project Name Spring Creek
Correctional Center
Project No, R10294
23. This Agreement may be modified or
amended by a written Agreement signed by both parties.
APPROVALS:
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TRANSFER OF RESPONSIBILITIES
AGREEMENT
Page 6.
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Authorized Signat for
MU"f/i,'ty
Titlio ~
Date
Authorize Si nature
Director, Design &
Central Region
IIJ. II, B~-
Date
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A, Scope of Work:
Project Name Spring Creek
Correctional Center
Project No. RI0294
APPENDIX A
(1) Partial funds for construction of 320 bed maximum
security correctional facility located at Fourth of
July Creek, Seward. Project name shall be "Spring
Creek Correctional Center."
(2) Administration of construction to be provided by the
Department of Transportation and Public Facilities.
B. Estimated Cost by Phase:
Design and Administration
Right-of-Way, Land
Acquisition
Utili ties
Construction
Equipment
Subtotals
TOTAL SUPPORTED BY APPRO-
PRIATIONS
TOTAL SUPPORTED BY
MUNICIPALITY FUNDING
TOTAL
Incurred By
State
Municipali ty
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1,412,075
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15,307,349
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1,870,000
26,728,790
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15,307,349
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30,010,865
$30,010,865
$ 15,307,349
C. Estimated Project Schedule:
Advertisement
Bid Award
Start of Construction
Constructon Completion
Date
July 1985
September 1985
October 1985
July 1987
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Project Name Spring Creek
Correctional Center
Project No. RI0294
APPENDIX B
Department of Transportation and Public Facilities
General Audit Steps
to be performed on
Transfer of Responsibility Agreements (TORA)
to meet the Audit requirements placed on the Municipality
Auditor will perform the following audit tests on
TORA's over $25,000.
1. Review TORA grant to determine any special require-
ments or stipulations related to the grant.
2. Review legislation to determine legislative intent
of the grant and the amount of the grant.
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3. Verify that final inspection and acceptance has
taken place by the State and project is complete,
4. Test a representative sample of expenses as
recorded on the Grantee's accounting system for accuracy. If
material errors are found, the sample should be expanded.
Minimum Tests as Applicable:
a. Adequate Supporting Documentation.
b. Proper Approving Authority.
c. Accurately Recorded on Municipality Record Books.
d, Eligibility (scope related).
e. Allocation (where applicable).
f. Reasonableness.
For equipment TORA's, verification of payment for
equipment and existence of equipment specified in the grant will
suffice.
5. Draw conclusions as to the project meeting original
intent and scope and whether reported expenses accurately reflect
the actual project cost/equipment cost/plan development cost.
6. Provide an audit report to Municipality with a copy
for State DOT & PF. The report should state that the audit was
performed in accordance with generally accepted auditing stand-
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ards and included such tests as were considered necessary in the
circumstances and state the auditors opinion that product
obtained (project/equipment/plan) meets the original intent and
stipulations of the grant. The report should state the total
dollars accepted by the auditor. The report should also include
any material except~ons noted, i.e" differences between actual
and reported expenses,
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Note: An overall organization wide audit will meet the
above requirements for TORA's under $25,000 if the overall
accounting system has adequate internal controls.
Issued February 4, 1983
By: Internal Review Section
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APPENDIX B
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Project Name Spring Creek
Correctional Center
Project No, R10294
APPENDIX C
02 AAC 45.010. AUDIT REQUIREMENTS. (a) As part of the
financial information required under AS 37.05.030, a state agency
that enters into a financial assistance agreement to provide
financial assistance to an entity shall, in coordination with any
other state agencies providing financial assistance to that
entity, submit to the Department of Administration through the
state coordinating agency an audit of the recipient entity if
that entity is subject to audit under (b) of this section. The
audit must be conducted and submitted as described in this
section. In order to ensure compliance with this subsection, the
audit requirements of this section must be contained in any
financial assistance agreement entered into by a state agency.
(b) An entity that enters into a financial assistance
agreement, or agreements, with a cumulative total of
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(1) $300,000 or more during a state fiscal year
shall submit to the state coordinating agency, within one
year after the end of the audit period, an annual audit
report covering the audit period; or
(2) at least $100,000 but less than $300,000
during each of two consecutive state fiscal years shall
submit to the state coordinating agency
(A) a biennial audit report covering the
audit period, due within one year after the end of
the audit period; or
(B) if the recipient entity chooses, or the
state requests, an annual audit report covering
the audit period, due within one year after the
end of the audit period.
(c) An audit required by this section must be conducted
by an independent auditor, according to the following audit
standards:
(1) Standards for Audit of Governmental
Organizations, Programs, Activities and Functions, 1981
revision adopted by the comptroller general of the United
States; or
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(2) generally accepted auditing standards, as
accepted by the American Institute of Certified Public
Accountants on July 1, 1985, for the entity being audited,
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(d) The audit report required under (b) of this section
must address the following:
(1) the systems of internal control, and whether
the recipient entity has effective control over, and proper
accounting for, revenues, expenditures, assets and liabili-
ties;
(2) the systems established to ensure compliance
with state statutes and regulations, and applicable finan-
cial assistance agreements, affecting the expenditure of
state money, and whether the recipient entity has complied
with those statutes, regulations and agreements;
(3) the recipient entity's financial transactions,
financial statements, ana accounts; whether those financial
statements are presented fairly in accordance with generally
accepted accounting priniples; and whether the financial
statements contain reliable financial data presented in
accordance with appliable financial assistance agreements.
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(e) An audit report required under (b) of this section
need not evaluate the effectiveness of a program funded by state
financial assistance. However, a program evaluation may be con-
ducted or requested by the state agency which entered into the
financial assistance agreement.
(f) An audit required by this section must cover either
the entire operations of the recipient entity, or at the option
of that entity, only the departments, agencies, or establishments
of that entity which received, expended, or otherwise adminis-
tered state financial assistance during the audit period. The
state coordinating agency may consider a series of audits of a
recipient entity's individual departments, agencies, or estalish-
ments for the same fiscal year as a single audit.
(g) A recipient entity shall provide the state coordi-
nating agency with sufficient copies of each audit report to
allow submission of a copy of each state agency providing finan-
cial assistance to the entity. The state coordinating agency
shall determine if auditing standards have been met and will
forward a copy of the audit to the Department of Administration
and other appropriate state agencies. The state coordinating
agency shall coordinate resolution of audit exceptions and
further audit work in accordance with (h) of this section.
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APPENDIX C
Page 2.
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(h) Unless additional audit requirements are imposed by
state or federal law, a state agency that provides financial
assistance to an entity shall accept the audit required by this
section in satisfaction of any other audit requirement. If addi-
tional audit work is necessary to meet the needs of a state
agency, the audit work must be based on the audit required by
this section and be paid for by the state agency. Audit excep-
tions noted during an audit required by this section must be
resolved by agreement between the recipient entity and the state
agency responsible for the financial assistance award agreement
involved.
(i) A third party that recieves financial assistance
through a recipient entity, in an amount described in (b) of this
section, is subject to the applicable requirements of the
section. A recipient entity that disburses $100,000 or more in
state financial assistance to a third party shall ensure that the
third party complies with the requirements of this section. That
recipient entity shall also ensure that appropriate corrective
action is taken within six months after a third party's
noncompliance with an applicable state statute or regulation, or
financial assistance agreement, is disclosed.
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(j) This section takes effect on August 1, 1985 for an
entity subject to audit under (b)(1) of this section and whose
fiscal year ends on or after June 30, 1986.
(k) This section takes effect on July 1, 1986 for an
entity subject to audit under (b)(2) of this section and whose
fiscal year ends on or after June 30, 1987.
(1) For purposes of this section, if an entity has not
identified its fiscal year, that entity's fiscal year is July 1
through June 30.
(m) For purposes of this section,
(1) "audit period" means
(A) for an annual audit under (b)(1) of this
section, the recipient entity's fiscal year in which
the entity entered into the financial assistance agree-
ment or agreements;
(B) for a biennial audit under (b)(2)(A) of
this section, the recipient entity's two consecutive
fiscal years in which the entity entered into the fin-
ancial assistance agreement or agreements;
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APPENDIX C
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(C) for an annual audit under (b)(2)(B) of
this section, the recipient entity's fiscal year in
which the entity entered into the financial assitance
agreement of agreements;
(2) "entity" does not include the University of
Alaska or any other state agency;
(3) "financial assistance" means state grants,
contracts, provider agreements, cooperative agreements, and
all forms of state financial assistance provided through an
entity to a third party; "financial assistance" does not
include public assistance provided under AS 47; nor does
"financial assistance" include goods or services purchased
for the direct administration or operation of state govern-
ment; for a third party, "financial assistance" does not
include goods purchased from the third party by a recipient
entity for the direct administration or operation of the
recipient entity;
(4) "state coordinating agency" means the Office
of Management and Budget (OMB), Office of the Governor, or
OMB's designee.
APPENDIX C
Page 4.
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PROJECT MANAGEMENT SERVICES AGREEMENT
THIS AGREEMENT MADE THIS 1"7 day O~'(L'riiJ~1985 is between
the CITY OF SEWARD, ALASKA (the "City"), and the STATE OF
ALASKA, acting through the Department of Transportation and
Public Facilities (the "State");
WHEREAS, funds have been appropriated by the Alaska
Legislature, under Chapter 107/SLA 83, Page 81, Line 9, and
Chapter 171/SLA 84, Page 59, Line 19, for the construction of a
prison and related facilities as described in Exhibit A attached
hereto and made a part hereof (the "Project");
WHEREAS, the State and the City have entered into a
Transfer of Responsibilities Agreement dated0<"T<,)t>to)L fI.,9Y:i,-
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WHEREAS, the City has agreed to lease the Project to the
State of Alaska acting through the Department of Administration;
WHEREAS, the City has undertaken to obtain additional funds
for the construction of the Project in accordance with a Trust
Indenture and Assignment of Lease between the City and Rainier
National Bank, as Trustee; and
WHEREAS the parties agree that the Project is now ready for
construction to commence and have determined that in order to
construct the Project in accordance with the plans and
specifications and within the constraints of the financing
arrangements set forth above it is in the public interest that
such construction be managed by the State,
WIT N E SSE T H
In consideration of the premises and of the mutual
covenants herein set forth, the parties hereto agree and
covenant as follows:
ARTICLE I
Definitions and General Provisions
1.01 Definitions. The following terms shall, for all
purposes of this Agreement, have the following meanings,
unless the context shall clearly indicate or require some
other meanings:
"Agreement" shall mean this Project Management Services
Agreement.
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"Certificate of Participation" and "Additional Certificate
of Participation" shall mean an evidence of interest in the
right to receive Rental issued pursuant to the Indenture to
provide funds to pay costs of the Project.
"Contract Documents" shall mean all plans and
specifications, drawings and other documents reflecting
agreements between the City or State and third parties
relating to any aspect of the Project.
"Costs" shall have the same meaning as set forth in
Paragraph 2.02 of the Lease Agreement.
"Indenture" shall meaO;cth,e.. .~ust Indenture and Assignment
of Lease dated as of ~~pte~er --L-, 1985, between the City
and Rainier National Bank as Trustee.
"Lease Agreement" shall mean the Agreement of Lease between
the City and the State of Alaska through the Department of
Administration dated ex 'jT..'p'c""1l / , 1985,
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"Project" shall mean the Spring Creek Correctional Facility
described in Exhibit A and supporting utilities which may
include, but not be limited to buildings, electrical
transmission lines, water and sewage systems, green belt or
recreation facilities, security systems and access roads.
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"Project Manager" shall mean that person designated by the
State with primary responsibility and authority for the
State's performance under this Agreement.
"Trustee" shall mean Rainier National Bank with its
principal office in Seattle, Washington.
1.02. Duration of Agreement. This Agreement shall take
effect upon execution. The parties recognize that the
State has already expended funds and rendered services in
connection with the design engineering and bidding of the
Project and those prior services rendered shall be subject
to the terms of this agreement. This agreement shall
remain in full force and effect until the Project shall
have been completed as that term is defined in the Contract
Documents, and further until all claims and disputes shall
have been concluded, This agreement may be amended only in
writing and after compliance with all applicable statutes,
ordinances and regulations.
1.03 Obligations of City limited to certain resources.
The liability of the City for payment of Costs shall be
limited to the proceeds from the sale of Certificates of
Participation or Additional Certificates of Participation
and in accordance with the terms of the Indenture.
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ARTICLE II
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Scope of Services General Provisions
2.01 General. The State agrees to provide all required
services to manage the construction to successful
completion of the Project in accordance with the Plans and
Specifications set forth in the Contract Documents and any
additions or changes thereto. In so acting the State shall
be the agent of the City subject to the limitations set
forth herein.
2.02 Quality of Services, The State accepts the
relationship of trust and confidence established between it
and the City by this Agreement. The State covenants with
the City to furnish its best skill and judgment and to
further the interest of the City at all times through
efficient business administration and management, The
State shall provide all services in a competent manner. It
is understood that some of the services to be rendered
hereunder require professional judgment and skill. In
those cases the State agrees to adhere to the highest
standards of the applicable profession.
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2.03 Timeliness of Services. The State recognizes the
need for and agrees to make best efforts to assure
compliance with the construction deadlines and dates set
forth in the Indenture and the Lease Agreement. The
parties recognize that time is of the essence in this
Agreement.
ARTICLE III
Personnel
3.01 Project Manager. The services to be performed by the
State will be under the supervision of a Project Manager.
The Project Manager shall be based in Seward for the
duration of this Agreement.
3.02 Resident Team. The State shall maintain in Seward a
Resident Team supervised by the Project Manager. The
Resident Team shall be supported by the State's Anchorage
offices and support staff.
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3,03 Additional Personnel. The State agrees to provide, in
addition to the Project Manager, the Resident Team and the
support staff, such additional personnel and services
reasonably required to assure construction of the Project,
Such services shall include, but shall not be limited to,
experts in various professional disciplines necessary for
review of the Contract Documents, changes thereto or claims
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from contractors; additional engineering and other
professional services required to review the work of
professionals on the project; and claims consultants or
experts as required to assess and resolve construction
claims or disputes.
ARTICLE IV
Particular Services
4.01 Inspection.
inspection of the
quanti ty.
The State will provide for continuous
Work on the Project to check quality and
4.02 Schedule Work. The State will schedule and coordinate
all work on the Project of all contractors including their
use of the Project site. The State shall prepare a master
construction schedule indicating milestone dates for the
project and constraints such as weather, materials, and
funding. The State shall also prepare master budget
statements and review schedule and costs with the City and
adjust as necessary to comply with funding and completion
date requirements.
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4.03 Compliance with Statutes/Regulations. The State shall
review and comply with all City and State procedures for
procurement, accounting, contracting, and Code compliance,
4.04 Payment to Contractors. In accordance with the
Indenture the State will review all applications for payment
by Contractors including final payment. The City shall not
be responsible for payment of any funds that have not been
approved by the State as provided in the Indenture.
4,05 Interpretation of Contract Documents, The State will be
the interpreter of the requirements of the Contract Documents
and the judge of the performance thereunder. The State will
render interpretations necessary for the proper execution or
progress of the Project with reasonable promptness and in
accordance with time limits set forth in the Contract
Documents.
4.06 Claims. Claims, disputes and other matters in question
between any contractor and the City or the State, or other
contractors on the Project shall be referred initially to the
State for decision in accordance with the provisions of any
applicable contract.
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4,07 Changes to Project. The State shall have the authority
to make changes, resolve disputes or claims or other matters
relating to the Project provided the State certifies, in each
case, that the funds remaining available for construction
under the Indenture are sufficient to conclude construction
and that the Project will be completed within the time period
set forth in the Lease Agreement, The State shall have no
authority to bind the City to any change or the resolution of
any dispute that would expose the City to any liability for
the construction of the Project beyond that assumed by the
City in accordance with the Indenture and the Lease
Agreement. The State shall take appropriate action on Change
Orders or Requests and except as set forth herein shall have
authority to order changes in the Work.
4.08 Acceptance/Rejection of Work. The State will have the
responsibility and authority to reject work which does not
conform to the contract documents.
4.09 Drawings and Documents, The State shall receive and
review all Shop Drawings, samples, plans and specifications.
The State shall review and take any appropriate action with
respect to such documents in order to assure conformance with
the Project design concept,
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ARTICLE V
Additional Funding
5.01 The parties understand that it is difficult to predict
with certainty the actual final construction costs of the
Project, The State also desires to have the flexibility to
make changes to the Project where deemed advisable but only
in those circumstances where the City's obligation to
conclude the construction of the Project is not increased
beyond its ability to obtain funding by the issuance of
additional certificates in accordance with the Indenture.
The State agrees to make every reasonable effort to request
supplemental funding, should the Project Costs overrun for
any reason the budgeted and/or available funding or be
delayed in completion. Such reasons may include, but not be
limited to, overruns in unit price quantities, change orders,
errors or omissions, changes requested by the State in the
design, scope or materials, contractors' claims, litigation,
force majeure or other causes. The State will make every
reasonable effort to obtain additional funding from the State
of Alaska including, if necessary, presenting the funding
requirements to the legislature and requesting legislative
funding of the shortfall.
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ARTICLE VI
City Responsibilities
6.01 Access to Records. The City shall assist the State by
placing at its disposal all available information pertinent
to the status of the Project, including previous reports and
any other data relative to design and construction of the
proj ect.
6.02 Access to Lands. The City shall guarantee access to and
make all provisions for the State to enter upon City lands
and private lands over which the City has the control of
access as may be required for the State to perform this
agreement.
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6.03 Review of Requests. The City shall review any requests
for disbursement of funds in accordance with the Indenture.
In order to assure and provide security for the holders of
the Certificates of Participation under the terms of the
Indenture, the State may not, without prior written approval
of the City and the Trustee commit the City to any extension
of time for performance or increase in contract expenditures
beyond the budgeted amounts and times for the Project.
Unless funds are deposited in the Construction Fund from
additional appropriations or the proceeds of the sale of
additional Certificates of Participation sufficient to pay
any increased costs, including any additional payments due on
the Certificates prior to Substantial Completion or costs of
delay, the City may, in its absolute discretion and to
further protect the interests of the Certificates of
Participation holders, refuse any request for either
extension of time for performance or increased contract
expenditures regardless of whether any third party has relied
upon representations of the State to the effect that such
approvals have or will be obtained.
The City agrees that changes requested by the State that
affect either the time for completion or increased costs for
the Project may be approved by the City, in its discretion,
upon the written assurance from the State that the time for
completion of the Project will not be extended beyond Sept.
1, 1987 and that the State has obtained or will obtain any
necessary funding for increased costs. The parties
aCknowledge that the City may rely upon such representations
of the State and that the City may be unable, and in any
event is not required, to independently verify those
representations.
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ARTICLE VII
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Price
7.0l This agreement is a fixed price contract. The state
has withheld from deposit to the Trustee under the terms of
the Indenture the sum of $1,314,700,00. This sum
represents the agreed upon price for the services expected
to be performed by the State in accordance with this
Agreement for the contemplated Project. In any event the
City's obligations hereunder shall be limited to funds
available for payment of costs under the Indenture,
ARTICLE VIII
Termination
8.01 Termination. Neither party may terminate this
Agreement for convenience.
.
8.02. Remedies on Termination. If this Agreement is
terminated the City may assume the work hereunder to be
performed by the State and prosecute the same to completion
by contract or otherwise and the State shall be liable to
the City for any costs incurred by the City which exceed
the costs the City would have incurred had this Agreement
not been terminated. Settlement of liability at the
completion of the work shall include any set-off available
to the City for delay in final completion of the Project
caused by the termination of this agreement.
8.03 Documents after Termination, Upon termination of
this Agreement for any reason and by either party, all data
reproduced, plans, specifications, reports, estimates,
summaries, completed work and work in progress, and other
such information and materials as may have been accumulated
by the State in performing this Agreement shall be
delivered to the City.
8.04. Other Remedies. The rights and remedies of the City
and the State provided herein shall not be exclusive and
are in addition t~ any other rights and remedies provided
by law or under this Agreement.
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ARTICLE IX
Insurance
9.0l The State shall secure and maintain such insurance as
will protect it from claims under the Workmen's
Compensation Acts and from claims for bodily injury, death,
or property damage which may arise from the performance of
its services under this Agreement. The minimum limits of
coverage shall be:
Alaska Worker's Compensation and
Employer's Liability Insurance
Statutory/$lOO,OOO
Comprehensive General-Auto
Liability, which includes Premises,
$100,000
Operations, Contractual Liability Combined Single Limit
and Owned, Hired and Non-Owned Vehicles
Professional Liability
$2,000,000
It is contemplated by the City and State that the State
has, or may enter into subcontracts with other professional
persons in connection with the Project. Any such
subcontracts shall not reduce or eliminate any obligations
of the State hereunder. The State shall not enter into or
continue any subcontract with any subcontractor unless such
subcontractor maintains professional liability coverage
providing for all errors or omissions which such
subcontractor or its employees may make which produce loss
or liability to the City and or protection against loss
which results from reliance by the City or State on
specifications, designs, reports or a combination thereof
produced by the subcontractor or its employees, which
professional liability coverage shall be in such reasonable
amounts agreed upon by the City and the State. All
professional liability policies shall remain in effect for
one year beyond completion of the Project.
9.02 The State shall not allow any subcontractor to
commence work on its subcontract until the insurance
required has been so obtained. The State shall furnish
certificate insurance showing the Clty and the Trustee
cO-lnsured, in evidence 0 the re u~rements of Sectlon
of the Agreeme~t. certificates must prOVl e a
30-day prior notlce to the City and the Trustee of
cancellation, non-renewal or material alteration of such
insurance. Failure to furnish satisfactory evidence of
insurance or lapse of coverage are grounds for termination
of this Agreement,
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CITY
TRUSTEE
ARTICLE X
Subcontracting and Assigns
10,Ol The City and the State each bind itself and its
partners, successors, executors, administrators and assigns
to the other party of this Agreement of such other party,
in respect to all covenants of this Agreement; except as
above, neither the City nor the State shall assign, sublet
or transfer its interest in this Agreement without the
written consent of the other, except the City may assign
its rights under this Agreement to the Trustee under the
Indenture, Nothing herein shall be construed as creating
any personal liability on the part of any officer or agent
of any public body which may be a party hereto, nor shall
it be construed as giving any rights or benefits hereunder
to anyone other than the City and the State.
10.02 The State shall perform all services required under
this Agreement and may not, except as may be approved in
writing by the City, assign the performance of any portion
of this Agreement to subcontractors. Any subcontractors
may be changed only upon written consent from the City.
All conditions of this Agreement are binding upon
subcontractors and shall be contained within any
subcontracts executed by the State to perform service under
this Agreement.
ARTICLE XI
Communications
ll.l All notices, demands and communications concerning
this Agreement shall be in writing and shall be directed to
the following persons unless otherwise directed by either
party:
STATE
Everett P. Diener
Engineering & Utilities Manger
P.O, Box 167
Seward, Alaska 99664
Phone: (907) 224-3331
Roger Head
Construction Engineer
5600 B. Street
Anchorage, Alaska 99518
Marty Grossman
Project Manager
Seward, Alaska 99664
Rainier National Bank
Corporate Trust Department
P.O. Box 3966
Seattle, Washington 98124
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ARTICLE XII
Equal Employment Opportunity
12.1 The State agrees during the performance of this
Agreement that it will not discriminate against any
employee or applicant because of race, color, religion,
sex, national origin, mental or physical handicap, and that
it will comply with the provisions of all applicable laws
concerning prohibition of discrimination,
12.2 The State will comply with provisions of all
applicable laws concerning local hire.
ARTICLE XIII
Audits and Records
13.1 The State shall maintain records of all performances,
communications, documents, correspondence and costs
pertinent to this Agreement, and the City, the Trustee or
either of their authorized representatives shall have the
right to examine such records and accounting procedures and
practices.
13,2 The materials described in this Section shall be made
available at all reasonable times for inspection, audit or
reproduction by the City, the Trustee or any funding agency
during the Agreement and at the State's office for a
minimum of three years from the date (a) of final
completion of the Project, (b) final payment upon
termination, or (c) conclusion of
litigation or settlement of any claims or disputes, and for
such longer period, if any, as may be required by
applicable statute or other provisions of this A~reement.
13.3 The City, the Trustee or any funding agency, has the
right to inspect, in the manner and at reasonable times it
considers appropriate during the period of this Agreement,
all facilities and activities of the State in the
performance of this Agreement.
ARTICLE XIV
Ownership of Work Products
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14.1 Work products produced under this Agreement, except
items which have pre-existing copyrights, are the property
of the City. Payments to the State for services hereunder
include full compensation for all work products, field
notes, interim design work, blueprints, surveys, and other
materials produced by the State and its subcontractors
pertaining to this Agreement.
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14.2 Should the City elect to reuse or rely on in the
original or in a redesigned manner, any work products
provided under this Agreement for other than the original,
specific and intended project and/or purpose, the City
shall indemnify the State and its subcontractors against
any responsibilities or liabilities arising from such reuse
or reliance. Reuse or reliance which requires a
professional signature and seal shall be signed, sealed and
dated by the professional in direct supervisory control and
who is responsible for the reuse, reliance or adaptation.
No royalty or other compensation for such reuse, reliance
or adaptation may be paid to the State or its
subcontractors. There are no limitations for the State of
Alaska to use any document, plans, specifications or other
work products for its purpose.
ARTICLE XV
Indemnity/Defense
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15.1 The State agrees to indemnify defend, and hold
harmless the City of Seward and its agents and officials
and employees from and against any and all claims, damages,
losses, and expenses arising out of the State's obligations
under this Agreement notwithstanding the City's agreement
to indemnify and hold harmless the State contained in
paragraph 6 of the TORA dated October 11, 1985 for this
Project.
15.2 Under this indemnity, the State is not liable for and
does not assume any liability or responsibility for the
acts, omissions or negligence of the City, its agents,
employees, or any of the City's third party contractors or
other persons working or involved in any stage of the
Project. In this respect the State shall review the work
of all third party contractors or other persons working or
involved in any stage of the Project and shall promptly
notify the City of, in the State's judgment, any failures
to act, omissions or negligence on the part of any such
persons or deficiencies that exist and are reasonably
discoverable by the State.
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15.3 The City shall cause all third party contractors to
the City and any other groups, organizations, or
individuals involved at any stage of the Project to agree
in such form as recommended by the State to indemnify
jointly the City and the State and hold them harmless from
all claims for bodily injury and property damage that may
arise from their activities,
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15.4 Prior to this agreement the State has been solely
responsible for all aspects of the Project The City
notwithstanding Paragraph 6 of the TORA does not assume any
responsibility or liability for any act, error or omission
of the State or its contractors prior to this agreement.
The State agrees to indemnify, defend, and hold the City
harmless from any claim, dispute, litigation or controversy
arising at any time and relating in any way to any act,
error or omission of the State or its contractors prior to
this Agreement. This indemnity includes errors or
omissions by the State or its contractors in the planning,
design and engineering of the Project.
XVI. MISCELLANEOUS
16.01 The parties agree that the laws of the State of
Alaska shall govern their rights and obligations under this
Agreement,
16.02 Any and all disputes shall first be addressed by the
Contracting Officer and the Deputy Commissioner of the
State for South Central Alaska, If they cannot resolve the
dispute it will be referred to the City Manager and
Commissioner of Transportation. If any other civil action
is brought by any party in connection with this Agreement
it shall be commenced and maintained in the Superior Court,
Third Judicial District, at Anchorage, Alaska, or the U.S,
District Court for the District of Alaska at Anchorage.
In witness thereof the parties hereto have caused this
agreement to be executed by their duly authorized officers as of
the date and year in above set forth.
City of Seward, Alaska
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ATTEST:
~j).~
Acting City Clerk
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State of Alaska
Department of Transportation &
Public Facilities
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"'I.J_.J.I __
APPROVED AS TO FORM:
Hughes, Thorsness, Gantz, Powell &
Brundin, Attorneys for the City of
Seward, Alaska
By: 7~ f2I L
Fred B. Arvidson
Harold M. Brown, Attorney General
State of l}laska
By: /d~~ (/~~.
A:ssistant Attorney General
0357S
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EXHIBIT A
(1) Construction
facility located
Project name shall
of
at
be
320 bed maximum security correctional
Fourth of July Creek, Seward, Alaska.
"Spring Creek Correctional Center".
(2) Administration of construction to be provided by the
Department of Transportation and Public Facilities (DOT&PF).
Project Name:
Proj ect No.:
Spring Creek Correctional Center
RI0294