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CR 2000-034 Encroachment Agreement Johnson Matthey Advanced Circuits . . . CITY OF ~ February 29, 2000 HOPKINS Council Report 2000-34 ENCROACHMENT AGREEMENT JOHNSON MATTHEY ADVANCED CIRCUITS Proposed Action Staff recommends adoption of the following motion: Move that Council authorize the mayor and city manager, on behalf of the City, to enter into an encroachment aqreement with Johnson Matthey Advanced Circuits, Inc. Overview As a private business providing its own fiber optic telecommunications, Johnson Matthey elected to install its own facilities in part within City right-of-way. Under the federal Telecommunications Deregulations Act of 1996 and recent state legislation, Minnesota cities are entitled to manage their public rights-of-way and to be reimbursed. The City discovered a Johnson Matthey installation in 16th Avenue South after the fact and now seeks to officially sanction that installation and to place controls on it. The City can use its standard approach of an encroachment agreement to meet regulation needs. Primary Issues to Consider · Johnson Matthey installation · Terms of the agreement · Recommendation Supporting Information . Encroachment agreement ~~ James Gessele Engineering Superintendent Financial Impact: $ None Budgeted: Y/N No Source: Related Documents (CIP, ERP, etc.): N/A Notes: N/A N/A . . . Council Report 2000-34 February 29, 2000 Page 2 Analysis . Johnson Matthey installation In 1998 Johnson Matthey Advanced Circuits installed a fiber optic cable in 16th Avenue South for purposes of communication between two of its facilities. Installation was done by directional bore methods (underground trenchless) and therefore no street excavations were done. City inspectors discovered this in a chance meeting with a Johnson Matthey official a year later. The company was informed of the requirement for a permit to operate within City right-pf-way_ It was also informed that permitting would help protect the installation once it was officially recognized by the City. . Terms of the agreement Johnson Matthey recognizes that its installation is subject to more formal regulations yet to be developed in the City's quest for a new right-of-way management ordinance. The company agrees to provide an engineer's location drawing of the facility and to engage in a location service to accommodate future underground work in the street. Johnson Matthey agrees to post a bond and to maintain Worker's Compensation Insurance and general liability insurance for the duration of the agreement. The agreement grants an initial eight-year term to operate in Hopkins with automatic renewal for additional five-year periods. No penalty payments will be applied to this agreement. . Recommendation Staff recommends approval of the encroachment agreement. . . . ENCROACHMENT AGREEMENT This Encroachment Agreement (this "Agreement") is made as of the day of __, 2000, by and between the City of Hopkins, a municipal corporation under the laws of Mim1esota ("City") and JOHNSON MATTHEY ADVANCED CIRCUITS, INC. a Minnesota corporation ("Johnson Matthey"), and having its principal office at 6442 City West Parkway, Suite 400, Eden Prairie, MN 55344. RECITALS ^. JO]1Oson Matthey represents that it is a corporation duly organized, and existing under the lmvs of the State of Minnesota and authorized by applicable state or federal law to maintain Telecommunications Services as described in this Agreement. B. Johnson Matthey has installed installed within Public Right-of- Way (as hereinafter defined) certain Facilities (as hereinafter defined) and has agreed to enter into this Agreement with the City and comply with the provisions contained herein and with the provisions of Millli. Stat. Chapter 237. C. The City has authority to grant the right to maintain encroachments within its rights-of-way only as expressly specified in applicable law, however, the City makes no representation, guaranty or warranty with respect to its title or interest in said rights-of-way. The City! and Johnson Matthey are entering into this Agreement for the purpose of stating the rights and llbligations of Johnson Matthey regarding the installation and maintenance of the Facilities \vithin Public Right-of-Way. c. Iii Ic\hnpciv illencroach.j11l . NOW, THEREFORE, in consideration of the foregoing Recitals A-C, other valuable consideration and the mutual undertakings and agreements contained herein, the City and Jolmson Matthey agree as follows: 1. Incorporation of Recitals. Recital Paragraphs A-C, above, arc incorporated in and made a part ofthi5 Agreement in their entirety. 2. Definitions. When lIsed in this Agreement, unless the context clearly indicates a contrary intent the following words and phrases shall have the meanings stated below: "City" means the City of Hopkins. Minnesota. "Johnson Matthey" shall mean and refer to Johnson Matthey, Advanced Circuits, Inc., a Minnesota corporation. "Fiber Optic Network Facilities" or ''racilities'' means telecommunications lines or cables, . fiber optic cables, conduits, converters, splice boxes, cabinets, handholds, manholes, vaults, equipment, drains, surface location markers, appurtenances and related facilities located or installed by Johnson Matthey in Public Right-of-Way and used or useful for the transmission of Telecommunications Services_ "Lav/' means any local, state or federal acL statute, ordinance. rule, regulation. code, license, certificate, II-anchise, permit, writ. ruling, award, executive order, directive, requirement injunction, judgment decree or other order issued, executed, entered or deemed applicable by any governmental authority. "License" means the License granted to Johnson Matthey under Paragraph 3 of this Agreement. "Management Costs" shall have the meaning stated in Minn. Stat. 237. I 62, Subcl. 9. . '" \lik\hopcivlikncroach.J1ll ., . e . "Public Right-of-Way" shall have the meaning stated in Mim1. Stat. 237.162, Subd. 3, but shall be limited to public rights-of-way within the City. "Telecommunications Services" shall be defined consistently with the de finition found in the Communications Act of 1934, as amended. CONSTRUCTION, MAINTENANCE AND OPERATION OF THE SYSTEM 3. License. Subject to the provisions of this Agreement, and all applicable Law, the City hereby grants a nonexclusive license (the "License") to Johnson Matthey to construct, maintain and operate Facilities for the purpose of providing Telecommunications Services, in, under, over and across the following Public Right-of-Way, and no other Public Right-of-Way: a. The Public Right-of-Way in which Johnson Matthey has installed new Facilities pursuant to the License granted by this Agreement is shown on the final permit drawings for such new Facilities approved by the City at the time of permit issuance. This Agreement. the License and Johnson Matthey's rights hereunder shall not be sold, transfened, leased, assigned or disposed of, in whole or in part, including but not limited to,by force or voluntary sale, merger, voluntary or involuntary bankruptcy. consolidation. receivership or other means without the prior written consent of the City, which consent shall not be umcasonahly withheld but may be conditioned upon the Assignee consenting, in writing, to be bound by the terms and condi tions of this Agreement. 4. Term. The term of this Agreement and the License shall be eight (8) years commencing on the date stated in the first paragraph of this Agreement and ending on the eighth anniversary date of said commencement date. The parties agree that this Agreement and the License shall automatically renew for additional consecutive five (5) year periods, unless either party gives c. \!ilc\hopc ivi I\cncroach.j III ., .J . a minimum of ninety (90) days advance written notice to the other of intent to tenninate prior to the end or the initial eight (8) year term of this Agreement or any renewal term. 5. No Interference. Except as permitted by applicable Law and this Agreement, in the performance and exercise of its rights and obligations under this Agreement, Johnson Matthey shall not damage or interfere in any manner with the existence, condition or operation of any Public Right-of- Way or any public or private roads, streets, curbs, sidewalks, sanitary sewers, water mains, storm drains. gas mains, poles, overheau and underground electric and telephone wires, facilities, electrollers, cable television wires and other telecommunications, utility, municipal or other public or private property without the prior written approval of the City and the owner(s) of the affected property or facilities. 6. No Property Interest. This Agreement is not intended to grant to Johnson Matthey . any property interest in any Public Right-of-Way and is made subject and subordinate to the prior. superior and continuing right ofthe City to use any Public Right-of-Way as a street and for any other public use and for the purpose onaying, installing, maintaining, repairing, protecting, replacing and removing sanitary sewers, water mains. storm drains, gas mains, poles and utility improvements, and for other municipal uses and with right of ingress and egress, along. over. across, under and in said Public Right-of-Way. 7. Application for Permits. Johnson Matthey shall apply for a permit for all work performed and all facilities installed within any Public Right-or- Way. Jolmson Matthey shall11rn furnish detailed plans of tbe work prepared by a registered professional engineer, and other such information as required by the City and by Law. and shall pay all Management Costs incuned by the City including, but not limited to. processing. field marking. engineering, inspection, security and . any other fees in accordance with the rates in effect at the time of payment subj ed to Section 18 of c:\li Ic\hllpC1V i I\enclnach.jm 4 . this Agreement Johnson Matthey agrees to place its Facilities underground in all locations where the City requires other telecommunications providers to do the same. In those areas of the City where Johnson Matthey's Facilities arc located on above-ground transmission or distribution facilities of a public utility or telecommunications provider. Johnson Matthey agrees to relocate or install its Facilities underground at its own cost and within 120 days of the City's request when: a. The utility, on whose poles Johnson Matthey has attached its Facilities, is required to relocate its facilities underground; or b. The City requires all telecommunications providers to relocate their above-ground facilities underground within the Right-of-Way. subject to the permit Said improvements shall be constructed and installed in according with the Law and this Agreement. 8. Issuance of Permits. Upon execution of this Agreement and performance of the . obligations contained in this Agreement by Johnson Matthey and compliance by Johnson Matthey with all permitting requirements. the City will issue all permits necessary to the installation of Johnson Matthey's telecommunications system, in accordance with the City's permitting procedures as may from time-to-time be amended in accordance with applicable law. 9. Manner of Construction. The construction. installation. operation. maintenance and removal of all Facilities shall be accomplished without cost or expense to the City and in such manner so as not to endanger persons or property, or unreasonably obstruct travel on any street road. walk or uther access thereon within any Public Right-of-Way. Jolmson Matthey shall proceed with all due diligence to complete construction of its Facilities as promptly as possible, without undue interruption or delay. Johnson Matthey shall not excavate or disturb public streets, roads or sidewalks that have been constructed hy the City within . five (5) years prior to installation of the Facilities but shall, instead, use installation and construction c. \!ik\horciv 11\<'llcmnch-i1l1 5 . techniques, such as directional boring, that require the least possible excavation or disturbance of public streets, roads or sidewalks. In the event excavation or disturbance of public streets, roads or sidewalks is unavoidahle. Johnson Matthey shall notify the City Engineer or City Engineering Supervisor and shall not proceed with such excavation or disturbance until written approval therefore has been obtained from the City Engineer or City Engineering Supervisor, which approval may be conditioned upon employing construction techniques that will minimize excavation or disturbance of pub I ic streets, roads or sidewalks. Johnson Matthey shall also use reasonable efforts to coordinate its construction schedule with the City's schedule of public improvements to minimize disruption and damage to City streets and other public improvements. The City shall keep Johnson Matthey reasonably apprised of its schedule of public improvements at all times during the construction of the Facilities. . Prior to performing any construction. installation, maintenance, repair or relocation work, Johnson Matthey shall contact all utility companies to obtain the location of utility lines and improvements that may be affected by work performed by Johnson Matthey. 10. Maps. Within sixty (60) days of completion of construction or the receipt of a fully executed Agreement, whichever is later, Johnson Matthey shall provide the City with accurate as- built maps or drawings certifying the location of all Facilities within Public Right-of-Way in a paper {(mnat and in a format compatihle and consistent with the City's electronic mapping system and/or including all data reasonably necessary to allow the City to develop a Right-of- Way mapping system. All such maps or drawings shall be certified to the City by a registered professional engineer. Within sixty (60) days of the date of this Agreement Johnson Matthey shall also provide the City with accurate as-huilt maps or drawings conforming to the requirements of this Section 10 certifying the . c :\Jilc\hllpciv i l\cllcrnachJl1l 6 location of all Facilities previously installed by Johnson Matthey pursuant to the penuit issued therefor oy the City. dated October 16. 1981). 11. Condition of Facilities. Johnson Matthey agrees to keep and maintain said Fiber Optic Network Facilities in good and safe condition and free from any nuisance. 12. Bond. Prior to issuance of any permit by the City for installation of any F acilties, Johnson Matthey shall deliver to the City and maintain a perfOlmance bond, in favor of the City. in the amount 01'$50.000.00 or such other amount as shall be subsequently required by any ordinance or regulation adopted by the City. which shall remain in force until sixty (60) days after substantial completion of construction of any Facilities by J ohn50n Matthey, to assure the restoration of Public Right-of-Way and any other property affected by construction of the Facilities. The bond shall be issued in a form and by a bonding company approved by the City. which approval shall not be . unnecessary withheld. . . 13. Required Authorizations. Prior to issuance of any permit. Johnson Matthey shall provide the City with sufficient information to establish that it has obtained all required government approvals and permits to construct and operate the Facilities and to offer and provide Telecommuni- cations Services including any cet1ification or other documentation required by the Public Utilities Commission ofthe State of Minnesota or any other regulatory entity. At all times during the tenn of this Agreement, Jolmson Matthey or an agent or consultant employed by Johnson Matthey shall maintain membership in Gopher State One Call [U1d shall furnish the City annually, and more frequently upon request proof that it is maintaining such membership. 14. Relocation for City Purposes. Johnson Matthey shall relocate. in cooperation with, <mel at no charge to the City. any Faci I ity installed, used or maintained under this Agreement if and \vhen made necessary by any change of grade. alignment or width of any street or road within any c Itiklh(lpcivillcllcroachJ!11 7 . Public Right-of- Way or the construction, maintenance or operation of any underground subway or viaduct by the City and/or the construction, maintenance, repair. replacement or operation of any other City or public utility underground or above-ground facilities or utility improvements. Johnson Matthey agrees to relocate or install its Facilities underground at its own costs and within sixty (60) days of the City's request, if such request is made between April 1 and October 1, and within 120 days of the City's request, if such request is made between October 1 and April 1. 15. Removal and Abandonment. Ifany portion(s) of the Facilities covered under this Agreement are no longer used by Johnson Matthey, or are abandoned for a period in excess of twelve (12) months, Jolmson Matthey shall notify the City and the City shall determine, and shall notify Johnson Matthey, that Johnson Matthey shall either promptly vacate and remove the Facilities at Jolmson Matthey's expense or abandon some or all of the Facilities in place to the extent permitted . by Law, whereupon Johnson Matthey shall promptly vacate or remove such Facilities. 16. Restoration of Public Rili:ht-of-Way. Whenever construction, installation, maintenance, repair, removal or rclocation of Facilities occurs within any Public Right-of-Way, Johnson Matthey shall, after completion of the construction. installation, maintenance, removal or relocation of the Facilities, at its own cost repair, restore and return the Public Right-of-Way on which the Facilities are or were located and any highway, road, sidewalk, utility or other improvements to the same or better condition existing before such construction, installation, maintenance, repair, removal or relocation. All such repair and restoration shall be done in accordance with Law, now or hereafter in effect. and such work shall be completed as promptly as the weather permits. Any repair or restoration work performed by Johnson Matthey between November 15 and April 30 will incorporate such measures as are required. due to weather conditions . or unavailability of paving materials, to assure proper permanent restoration, including temporary c:\tIlelhopcivillcncroach im 8 . repair or restoration measures which Johnson Matthey shall replace by means of permanent restoration methods at such time as weather conditions and availability of materials permit. If Johnson Matthey does not properly perform and complete the work, remove all dirt, rubbish, equipment and materiaL and restore the Public Right-of-Way to the same or better condition, the City may restore the Public Right-of-Way and any highway, road, sidewalk, utility or other improvements to the same condition at the expense of Johnson Matthey. Johnson Matthey shall. upon dem:md, pay to the City the direct and indirect cost of the work done for or performed by the City, including but not limited to, the City's administrative costs. 17. Damage Jolmson Matthey shall be responsible for damage to city street pavements, existing utilities, curbs, gutters and sidewalks due to Johnson Matthey's installation, maintenance, repair or removal of its Facilities in Public Right-or-Way, and shall repair, replace and restore the . damaged Public Right-of...Way and such improvements at its sole expense and subject to approval by the City, which approval shall not be unreasonably witW1eld or delayed. 18. Other City Requirements. Johnson Matthey shall pay all permit and user fees or any other fees to the City in accordance with applicable law. Johnson Matthey expressly acknowledges and agrees that the City shall have the right to impose upon Johnson Matthey additional fees and/or damages for Johnson Matthey's occupation of the Public Right-of... Way to the extent not inconsistent with applicable law. It is intended that, subsequent to the execution of this Agreement, the City wi II adopt an ordinance imposing comprehensive requirements on teleeommuni- cation Right-of- Way users such as Johnson Matthey pursuant to Minn. Stat. Chapter 237. Johnson Matthey further acknowledges and agrees to be bound by any subsequent ordinance or regulation adopted by the City with respect to the City's lawful control over its Public Right-of. Way and hereby . agrees and acknowledges that su<:h ordinance or regulation, including any permit and fee C' Ifi klhopc IV i Ikncroach jlll 9 requirements, will be retroactively applied to Johnson Matthey. Any permit or user fees paid by Jolmson Matthey prior to the adoption of a subsequent ordinance shall be credited against those fees required by a subsequent ordinance. I f there are any inconsistencies between the terms of this Agreement and those of any subsequent ordinance or regulation, the terms of any subsequent ordinance or regulation shall take precedence. Johnson Matthey agrees to reimburse the City for the City's out-of-pocket consultant fees and expenses incurred to process Johnson Matthey's request for the License and installation of the Facilities in Public Right-of-Way. The City shall provide Johnson Matthey with copies of all invoices relating to said costs and expenses and Johnson Matthey shall only provide reimbursement for costs and expenses actually incuned by the City. Any amount paid by Johnson Matthey to reimburse the City hereunder shall not be credited against other amounts payable to the City by . Johnson Matthey hereunder. . . 19. Nondiscriminatory Fees. With respect to the City's imposition of any fees or charges not specifically required in this Agreement Johnson Matthey shall only be required to pay any fee or charge to the extent permitted by law and which is imposed in a competitively neutral and nondiscriminatory manner with respect to other similarly situated telecommunications providers. GENERAL TERMS 20. Indemnification. Johnson Matthey, jointly and severally, for itself: its successors, agents, contractors and employees, agrees to indemnify, defend (with counsel acceptable to City) and hold harmless City, its officials, representatives, employees and agents from and against any and all claims, demands, losses. damages. liabilities, fines and penalties and all costs and expenses incurred in connection therewith, including, without limitation. reasonable attomeys' fees and costs of defense arising directly or indirectly, in whole or in part out of the construction, installation, maintenance, c:111 k\hnpCl \' illencroach.J III 10 . repair, removal or relocation of Facilities within any Public Right-of- Way or any breach by Johnson Matthey of its obligations described in this Agreement except to the extent arising solely from the City's willful action or negligent acts or omissions. 21. Insurance. Johnson Matthey and/or any of its subcontractors or agents under the Agreement shall maintain throughout the term of this Agreement, Workers' Compensation Insurance complying with all statutory requirements and comprehensive general liability insurance, which latter insurance shall provide the following coverages and minimum limits: a. General Liability - public liability, including premises, products and complete operations. (i) Bodily injury liability: $1,000,000.00 each person $1,000,000.00 each occurrence $2,000,000.00 in the aggregate . (ii) Prope11y damage liability $1,000.000.00 each occurrence $2,000,000.00 in the aggregate or (iii) Bodily injury and property damage combined $1,000,000.00 each OCCL1lTence $2.000,000.00 in the aggregate b. Comprehensive - automobile liability insurance, including owned, non-owned and hired vehicles. (i) Bodily injury liability $1,000,000.00 each person $2,000,000.UO each OCCUlTencc (ii) Propc11y damage liability $2,000,0()().00 each occurrence c. Johnson Matthey agrees that with respect to the above-required insurance, contracts will contain the following required provisions: (i) The City and its officers. agents, employees, board members and elected officials shall he named as additional insured (as the interests of each may appear) as to all applicable coverage; and . c '\1,1 ~\h()p c i v i I\enc rnac h.1l11 11 . . . (ii) Contracts shall provide for thirty (30) days notices to the City prior to cancellation, revocation, nonrenewal or material change. d. The amount of liability and comprehensive insurance may he increased upon sixty (60) days' written notice by the City should the protection afforded by this insurance be reasonably deemed by the City to be insufficient for the risk created by this Agreement, provided the City may not require such increases more than one time every three years during the term of this Agreement At no time, however, vvill the amount of required liability and comprehensive insurance exceed that which is customarily required of others for similar situations of ri sk. c. Prior to issuance of any permit, Johnson Matthey shall furnish a Certificate of Insmance to the City confirming the above-noted coverages and naming the City as an additional insurance. 22. Default. IfJo}mson Matthey is in material default of any obligations contained in this Agreement or in the performance of the work or occupancy authorized by this Agreement or any permit granted pursuant to this Agreement, including. but not limited to, restoration requirements or fee payments for more than thirty (3D) days after receiving written notice from the City of the default, the City may after \vritten notice and the expiration of a reasonable opp0l1unity to cure period not exceeding sixty (60) days, terminate and revoke the License and the rights of Jolmson Matthey under this Agreement and any permit granted hereunder, provided Jolmson Matthey shall not be entitled to prior notice in emergencies or in circumstances in which the City has the absolute right to terminate or revoke this Agreement and any permits granted to Johnson Matthey in the exercise of the City's police powers. If Johnson Matthey is in default of any obligation contained in this Agreement, in the performance of the work or occupancy authorized by this Agreement or any permit granted hereunder. the City may. after the above notice to Johnson Matthey, if required. and failure of Johnson Matthey to cure the default, take such action as may be reasonably necessary to abate or remedy the condition caused by the default Johnson Matthey shall reimburse the City for the City's c .11i lelhopCLV il\cncl oachjlll 12 . . . reasonable costs, including (,;osts of collection and attorneys' fees, incurred as a result of Johnson Matth(,;y's default and the correction or abatement thereof. 23. Notices. All notices or other communications required or permitted to be given under this Agreement shall be in writing and shall be hand delivered or sent by certified mail, return receipt requested, to the following addresses: If to Johnson Matthey: Johnson Matthey Advanced Circuit, Inc. Attention: 6442 City West Parkway Suite 400 Eden Prairie. MN 55344 with a copy to: JM Electronics Attention: Legal Department 6442 City West Parkway Suite 400 Eden Prairie. MN 55344 If to City: City of Hopkins Attention: Engineering Supervisor 10 10 First Street South Hopkins, Minnesota 55343 If notice is given by certified mail, such notice shall be deemed to have been given on the next husiness day tlJllovving the date of mailing. 24. Emergency Work. In the event of any emergency in which any of JOMson Matthey's Facilities located in. above or under any Public Right-of-Way are or may be damaged. or if Johnson Matthey's construction area or Facilities are otherwise in such a condition as to immediately endanger the propelty, life, health or safety of any individual, Johnson Matthey shall immediately take the proper emngew.:y measures to repair its Facilities, to cure or remedy the dangerous conditions f<Jr the prott'ction of property, lite, health or safety of individuals, and the rC4uirements of this Agreement or any City ordinance for first obtaining a permit may be waived in appropriate c \lilc\hopcivil\encroachJI1\ 13 . . . emergency circumstances. However. this shall not relieve Johnson Matthey from the requirement of notifying the City of the emergency work and obtaining any pennit necessary for this purpose upon completion of the repairs. 25. Miscellaneous. a. This Agreement is made and executed in the State of Minnesota, and shall be construed and enforced according to the laws of Minnesota. b. The invalidity or unenforceability of any provision of this Agreement shall not affect or impair the validity of any other provisions, all of which shall remain in full force and etTect. c. The section titles and captions in this Agreement are for convenience of reference only and do not define, limit or construe the contents of the sections and paragraphs of this Agreement. d. This Agreement shall be binding upon and inure to the benefit of the parties hereto and, subject to the restrictions and limitations herein contained, their respective successors and assigns. e. Any modification to this Agreement shall only be effective if in writing and signed by all of the parties to this Agreement. IN WITNESS WHEREOF, the parties have duly executed this Agreement as ofthe date first above written. c 11I1e\hopcivll\cncroach jm 14 . . . Dated: Dated: .2000 ,2000 Reviewed and approved by the City Attorney. City Attorney Dated: February 1 c\1I1e\llDpcIVll\encroach 1m ,2000 City of Hopkins, MilU1esota By Eugene J. Maxwell, Its Mayor By_~ Steven C. Mielke, Its Manager Johnson Matthey Advanced Circuits, Inc. -7 /// ~/ .' .../"'I.~Jj -~ =:> ~y "--, Its 15