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Home My WebLink AboutBoard of Commissioners - Minutes - 03/28/2006MINUTES OF THE OTTER TAIL COUNTY BOARD OF COMMISSIONERS Government Services Center, Commissioners' Room 500 Fir Avenue W., Fergus Falls, MN Tuesday, March 28, 2006 9:30 a.m. Call to Order The Otter Tail County Human Services Board convened Tuesday, March 28, 2006, at 9:31 a.m. at the Otter Tail County Government Services Center with Commissioners Roger Froemming, Chair; Malcolm Lee, Syd Nelson, and Bob Block present. Vice-Chair, Dennis Mosher, was present at 9:35 a.m. Approval of Agenda Motion by Block, second by Lee, and unanimously carried to approve the Human Services Board agenda of March 28, 2006, with the following addition: Request for Approval of Public Health Contracts Approval of Minutes Motion by Froemming, second by Lee, and unanimously carried to approve the Human Services Board minutes of March 14, 2006, as mailed. Court Services Department Court Services Director, Chuck Kitzman, presented information that his office will provide at the town hall meeting in Fergus Falls that will address the problem of underage drinking. Public Health Contracts Motion by Nelson, second by Block, and unanimously carried to authorize the appropriate County Officials' signatures to execute a contract between the County of Otter Tail and the State of Minnesota Department of Health which provides $1,546.00 to Otter Tail County for Refugee health care, based on a population of 2,933 foreign borne people in Otter Tail County that have a higher risk for needing INH therapy for tuberculosis. Ms. Thorson reported that refugee care in 2005 cost Otter Tail County $17,757.00 and the State reimbursed only 8. 7% of the total cost. Motion by Nelson, second by Block, and unanimously carried to authorize the appropriate County Officials' signatures to execute a contract between the County of Otter Tail and Otter Tail-Wadena Community Action Council for the period of January, 1, 2006 to June 30, 2007. The funding from the State of Minnesota, in the amount of $105,795.00, for family planning services is passed through Otter Tail County to the Community Action Council. Draft Smoke-Free Ordinance Ms. Thorson presented a draft Smoke-Free Ordinance for discussion purposes. She talked about the reason why the ordinance is proposed, the authority the County Board has to enact an ordinance, and input from the Public Health Advisory Committee. The Advisory Committee is recommending the strongest smoke-free ordinance. All public businesses and work places would be smoke-free in addition to several outdoor areas. After public informational meetings that will be held the first part of April, the Advisory Committee will evaluate the information received at the meetings and then, a final draft ordinance would be presented. The Advisory Committee is recommending an effective date of July 1, 2006, for OTC Board of Commissioners' Minutes March 28, 2006 Page 2 the ordinance to protect the most people in the shortest amount of time. Commissioners asked questions about the proposed ordinance in relation to other factors that cause health problems and expressed concerns that some businesses could feel a negative economic impact, which could translate into people losing their jobs. Commissioner Nelson stated that the State of Minnesota should address the issue so it is the same for everyone throughout the State rather than having each local government unit regulating smoking differently. Human Services Contract Motion by Nelson, second by Mosher, and unanimously carried to authorize the Chairman's signature to execute a Purchase of Service Agreement between Otter Tail County and Otter Tail-Wadena Community Action Council for the period of April 1, 2006 through March 31, 2007. The contract is for the Fathers Resource Program and funding, in the amount of $105,882.00, is provided through grant dollars and federal IVD Child Support Program Services. 2006 Legislative Session Human Services Director, John Dinsmore, provided copies of a handout entitled "Fast Facts: 2006 Legislative Session". He reviewed legislative proposals and issues with the proposals. The largest concern is complying with the federal Deficit Reduction Act of 2005 (DEFRA), which could result in elimination of up to 94 million dollars statewide for child welfare targeted case management. This would impact the Otter Tail County Human Services Agency budget at the rate of $250,000.00, as well as an additional $150,000.00 that was going to the Family Services Collaborative. The Governor is proposing improving care for children and adults with mental illness. This could result in a change in the delivery of health services, whereby, OHS would contract directly with health plans, not necessarily with the Human Services agencies. Mr. Dinsmore discussed other proposals for the uninsured and addressing the growth in civil commitments of sex offenders. Bills & Claims Motion by Lee, second by Nelson, and unanimously carried to approve the Human Services bills and claims as presented. Adjournment At 10:30 a.m., Chairman Froemming declared the meeting of the Otter Tail County Human Services Board adjourned until 9:30 a.m. on Tuesday, April 11, 2006. Dated: _ __,'fc..._-...._l.._l-_.2"""""oa<>-<-"lz"---OTTER TAIL COUNTY HUMAN SERVICES BOARD / ------------- Call to Order OTC Board of Commissioners' Minutes March 28, 2006 Page 3 The Otter Tail County Board of Commissioners convened Tuesday, March 28, 2006, at 10:47 a.m. at the Otter Tail County Government Services Center with Commissioners Roger Froemming, Chair; Dennis Mosher, Vice-Chair; Malcolm Lee, Syd Nelson, and Bob Block present. Approval of Agenda Motion by Mosher, second by Lee, and unanimously carried to approve the County Board agenda of March 28, 2006, as mailed. Approval of Minutes Motion by Lee, second by Block, and unanimously carried to approve the County Board minutes of March 21, 2006, as mailed. Approval to Pay Bills Motion by Block, second by Nelson, and unanimously carried to approve payment of the County Board bills per Attachment A of these minutes. Sheriff Patrol Station Sheriff, Brian Schlueter, requested approval to purchase a 9.6 (approximate) acre parcel located south and east of the intersection of County Highway 55 and State Highway 108 for use in construction of a new Sheriff Patrol Station. The Sheriff explained that dispatching patrols from a central point in the County will reduce response and travel times and provide critical emergency backup in a separate location. Lengthy discussion followed. Motion by Lee, second by Block, and unanimously carried to enter into a Purchase Agreement with RDO, for a parcel of land, approximately 9.6 acres in size, at a cost of $5,000.00 per acre and authorization to complete Phase 2 of the Site Survey, providing a Certified Property Survey and accurate determination of acreage. Motion by Mosher, second by Lee, and unanimously carried to authorize the Chairman's signature to execute an agreement between Otter Tail County and Shultz & Associates, Ltd. to complete Space Programming and Schematic Design Services to develop the project scope and budget for the proposed Sheriff Patrol Station near Ottertail City, with compensation for Professional Services in the amount of $26,000.00. Compensation will be credited toward total project fee at which time the project proceeds to complete design and construction. RESOLUTION SUPPORTING LANGUAGE CHANGE TO MOTOR VEHICLE SALES TAX CONSTITUTIONAL AMENDMENT Otter Tail County Resolution No. 2006 -22 WHEREAS, the proposed constitutional amendment reads, "Shall the Minnesota Constitution be amended to dedicate revenue from a tax on the sale of new and used motor vehicles over a five-year period, so that after June 30, 2011, all of the revenue is dedicated at least 40 percent for public transit assistance and not more than 60 percent for highway purposed?" and, WHEREAS, the proposed constitutional amendment language is misleading and needs to be changed, and, OTC Board of Commissioners' Minutes March 28, 2006 Page 4 WHEREAS, current language guarantees 40% of MVST revenue for transit but does not guarantee any funding for roads through the Highway User Tax Distribution Fund, and, WHEREAS, current language could allow all 60% of non-guaranteed highway funding to fund large metro projects such as the Light Rail between Minneapolis and St. Paul or the 35 Crosstown project, and, WHEREAS, County Engineer, Rick West, supports language that would seek to change the language of the Motor Vehicle Sales Tax (MVST) proposed constitutional amendment to a straight 60% of revenue to highways through the Distribution Fund and 40% to transit. NOW, THEREFORE, BE IT RESOLVED, that the Otter Tail County Board of Commissioners of Otter Tail County hereby supports S.F. 2446 (Skoe, Langseth, Senjem, Sams and Vickerman) and H.F. 3048 (Lanning, Sviggum, Holberg, Hosch, Demmer) that would seek to change the language of the Motor Vehicle Sales Tax proposed constitutional amendment to a straight 60% of revenue to highways through the Highway User Tax Distribution Fund and 40% to transit, and, BE IT FURTHER RESOLVED, that the Otter Tail County board of Commissioners also supports S.F. 2444 (Skoe) and H.F. 2915 (Gunther) that would seek to change the proposed constitutional amendment to a straight 60% highways/40% transit split. The above and foregoing resolution was offered at a regular meeting of the Otter Tail County Board of Commissioners held on March 28, 2006, by Commissioner Lee, who moved its adoption, was seconded by Commissioner Block and duly adopted by a unanimous vote. Dated: 04/t,y/o(,, --=--4-, -"-''--11'-=------OTTER TAIL COUNTY BOARD OF COMMISSIONERS Attest:_kut_~L_ ommissioners Chair Larry Krohn, Clerk Final Plat -"Bev's Acres" Motion by Nelson, second by Mosher, and unanimously carried to approve the Final Plat of Gary Bergum known as "Bev's Acres" in Section 1 of Dead Lake Township, Marion Lake (56-243). Final Plat Extension Request Land & Resource Director, Bill Kalar, provided background regarding the Preliminary Plat of The Palms of Lida. Developer, Bruce Qvammen, requested an extension for the filing of the Final Plat. Lengthy discussion took place regarding the plat and road servicing the plat. Motion by Lee, second by Block, and unanimously carried to authorize a six-month extension for filing the Final Plat known as "The Palms of Lida". Commissioner Block absent at 11 :30 a.m. OTC Board of Comm1ss1oners' Minutes March 28, 2006 Page 5 City of Underwood Bike Path Discussion Highway Engineer, Rick West, provided copies of a letter he received from the Mayor of the City of Underwood; wherein the City is requesting that Otter Tail County pave the bike path on the North side of Highway 35 from Main Street to Highway 210. Motion by Froemming, second by Lee, and unanimously carried to deny the request of the City of Underwood to pave the bike path at an estimated cost of $13,600.00. Reduction in Retainage, Henning Highway Garage Motion by Nelson, second by Lee, and unanimously carried to reduce the retainage for the Henning Highway Garage project to $5,000.00. Bid Award -2006 Seasonal Supplies After previously advertising for bids, the following bids for 2006 Seasonal Highway Supplies were opened at 1 :00 p.m. on March 15, 2006: Bituminous Material Bituminous Material (East Otter Tail County) Bituminous Material (West Otter Tail County) Bituminous Material (North Otter Tail County) Crack Filling Material (Deery 101) Signing Materials Murphy Oil USA, Inc. Superior, WI Flint Resources, LP Savage, MN $1.6313 per gallon $1.6360 per gallon Central Specialties, Inc. Alexandria, MN Mark Sand & Gravel Co. Fergus Falls, MN Quality Asphalt Co., Inc. Deer Creek, MN Wadena Asphalt, Inc. Wadena, MN Central Specialties, Inc. Alexandria, MN Mark Sand & Gravel Co. Fergus Falls, MN $35.68 per ton $34.00 per ton $29.82 per ton $26.62 per ton $35.68 per ton $34.00 per ton Central Specialties, Inc. $35.68 per ton Alexandria, MN Lakes Paving, Inc. $35.50 per ton Oba Sherbrooke Asphalt Detroit Lakes, MN Mark Sand & Gravel Co. $34.00 per ton Fergus Falls, MN Midstates Equip & Supply $0.392 per pound Mountain Lake, MN Swanston Equip Corp $0.405 per pound Fargo, ND Newman Signs, Inc. Jamestown, ND M-R Sign Company Fergus Falls. MN Lyle Signs Eden Prairie, MN $71,360.00 $68,000.00 $59,640.00 $53,240.00 $71,360.00 $68,000.00 $71,360.00 $71,000.00 $68,000.00 $103,372.93 $109,624.39 $110,726.99 OTC Board of Commissioners' Minutes March 28, 2006 Page 6 s easona IS UDDIY 0 In er an fW t S d Alexandria Concrete Alexandria, MN 3,500 ton or 2,500 CY $14.23/ton FF Mn/DOT Facility $19.92/cv 2,100 ton or 1,500 CY $17.77/ton PR Mn/DOT FacIlIty $24.88/cy 1, 120 ton or 800 CY $16. 77/ton Erhard County Garaoe $23.48/cy 2,100 ton or 1,500 cy $8.76/ton Perham Mn/DOT Facility $12.28/cy 2,100 ton or 1,500 cy $6.87/ton NYM County Garaoe $9.62/cy 1,120 ton or 800 cy $5.46/ton Hennina Mn/DOT FacIlIty $7.64/cy 2,100 ton or 1,500 cy $6.92/ton BL County Garage $9 68/cy Aggregate Krause Bros. Mark Sand & Industries-NCR Construction Gravel Moorhead, MN Wahoeton, ND Ferous Falls, MN $6 65/ton $8 47/ton $8 20/ton $11 86/cv $11.50/cy $5.50/ton $8.98/ton $15.00/ton $12.57/vy $21.00/cy $6.05/ton $8.47/ton $12.00/ton $11.86/cy $16.80/cy $6.65/ton $14.09/ton $18.00/ton $19.73/cy $25.20/cy $6.65/ton $15.79/ton $16.00/ton $22.11/cy $22.40/cv $6.65/ton $13.07/ton $12.00/lon $18.30/cy $16.80/cy $6.65/ton $11.87/ton $8.20/ton $16 62/cy $11.50/cy Motion by Nelson, second by Mosher, and unanimously carried to award the following Otter Tail County 2006 Seasonal Supplies for the Highway Department: Seasonal Supply Bid Amount Bituminous Material Murphy Oil USA, Inc. $1.6313/gal. Superior, WI Hot Mix Bituminous (East) Central Specialties, Inc. Alexandria, MN Mark Sand & Gravel Co. Fergus Falls, MN Quality Asphalt Co., Inc. Deer Creek, MN Wadena Asphalt, Inc. Wadena, MN Hot Mix Bituminous {West) Central Specialties, Inc. Alexandria, MN Mark Sand & Gravel Co. Fergus Falls, MN Hot Mix Bituminous {North) Central Specialties, Inc. Alexandria, MN Lakes Paving, Inc. Detroit Lakes, MN Mark Sand & Gravel Co. Fergus Falls, MN $71,360.00 $68,000.00 $59,640.00 $53,240.00 $71,360.00 $68,000.00 $71,360.00 $71,000.00 $68,000.00 OTC Board of Commissioners' Minutes March 28, 2006 Page 7 Crack Filling Material -Deery 101 Midstates Equipment & Supply Mountain Lake, MN $0.392/pound Signing Materials Neuman Signs, Inc. Jamestown, ND Winter Sand Aggregate Industries-NCR Moorhead, MN Alexandria Concrete Alexandria, MN Culverts $103,372.93 Fergus Falls Pelican Rapids Erhard Perham NYM Battle Lake Henning $6.65/ton $5.50/ton $6.05/ton $6.65/ton $6.65/ton $6.65/ton $5.46/ton Johnston Fargo Culvert, Inc. State Bid -Contract #434075 St. Paul, MN March 1, 2005 -February 28, 2007 Herbicides State Bid -Contract Pending Recommend Purchase from State Bid Commissioner Block was present at 11 :45 a.m. Pump System for Johnson Lake Motion by Mosher, second by Froemming, and unanimously carried to authorize the Chairman's signature to execute a contract between the County of Otter Tail and Feldt Plumbing, LP of Detroit Lakes, MN, for C.P. 05:12 Outlet, Johnson Lake Temporary Outlet North of Johnson Lake in Section 5 of St. Olaf Township. Right of Way Agreement -S.A.P. 56-686-01 Motion by Lee, second by Nelson, and unanimously carried to authorize the Highway Engineer to enter into an agreement between the County of Otter Tail and the U.S. Fish & Wildlife Service to obtain a right of way permit for the CSAH 86 project, in the amount of $300.00. Quit Claim Deed Motion by Nelson, second by Lee, and unanimously carried to authorize the Chair and Clerk's signature on the Quit Claim deed conveying the following legally described property to Thomas J. and Nancy Schmitz: Legal Description That part of Lot A of Rothpletz's Addition to the Village of Perham, said plat is on file and of record in the office of the Recorder in Otter Tail County, Minnesota, described as follows: Beginning at an iron monument which designates the most easterly corner of said Lot A; thence North 50 degrees 15 minutes 37 seconds West 6.16 feet on an assumed bearing along the northeasterly line of said Lot A to an iron monument; thence South 39 degrees 51 minutes 41 seconds West 75.38 feet to an iron monument on the northeasterly right of way line of OTC Board of Commissioners' Minutes March 28, 2006 Page 8 County State Aid Highway No. 80; thence South 44 degrees 32 minutes 55 seconds East 6.18 feet along the northeasterly right of way line of said County State Aid Highway No. 80 to an iron monument on the southeasterly line of said Lot A; thence North 39 degrees 51 minutes 41 seconds East 76.00 feet along the southeasterly line of said Lot A to the point of beginning. The above described tract contains 465 square feet. All mineral rights to the property shall be reserved to the County of Otter Tail, Minnesota. Payment Approved Motion by Nelson, second by Lee, and unanimously carried to approve payment to DHW Consulting, in the amount of $607.04, for services/expenditures related to the March 16, 2006 Gravel Tax Hearing. Premise Permit Otter Tail County Resolution No. 2006 -23 Commissioner Nelson offered the following and moved its adoption: WHEREAS, the responsibility for the regulation of lawful gambling and the issuance of licenses and permits for the conduct of lawful gambling lies with the Minnesota Gambling Control Board; and WHEREAS, the Perham Lions, Perham, MN, has made an application to the Gambling Control Board for the purpose of conducting lawful gambling at The Cactus, located at 43521 425th Street (Fort Thunder Rd) in Perham Township of Otter Tail County; and WHEREAS, Minnesota Statute 349.213 provides that the Gambling Control Board may not issue a premise permit unless they receive a resolution from the Otter Tail County Board of Commissioners approving the application for a permit; and WHEREAS, the Otter Tail County Board of Commissioners is aware of no reason to oppose the conduct of lawful gambling by the Perham Lions, Perham, MN, at The Cactus, located at 43521 425th Street (Fort Thunder Rd) in Perham Township of Otter Tail County. NOW, THEREFORE, BE IT RESOLVED, that the Otter Tail County Board of Commissioners hereby approves the conduct of lawful gambling by the Perham Lions, Perham, MN, at The Cactus, located at 43521 425th Street (Fort Thunder Rd) in Perham Township of Otter Tail County, provided the applicant meets all the necessary criteria for the licenses and permits as required by the Gambling Control Board. IT IS FURTHER RESOLVED, that notice of this application and approval shall be provided to the Township of Perham by sending them a copy of this resolution. Commissioner Mosher seconded the motion, and upon being put to a vote, was unanimously carried. OTC Board of Commissioners' Minutes March 28, 2006 Page 9 Adopted and bned this 28th day of March 2006. Dated: ~ ~/4t,, OTTER TAIL COUNTY BOARD OF COMMISSIONERS .·, ~-I/} Attest:__,.'¥'-/ /""/~>q---'-,,,~~~-- l~hn, Clerk By: I Roger g, Board of Commissioners Chair Premise Permit Otter Tail County Resolution No. 2006 -24 Commissioner Nelson offered the following and moved its adoption: WHEREAS, the responsibility for the regulation of lawful gambling and the issuance of licenses and permits for the conduct of lawful gambling lies with the Minnesota Gambling Control Board; and WHEREAS, the Perham Lions, Perham, MN, has made an application to the Gambling Control Board for the purpose of conducting lawful gambling at Zorbaz, located at 45738 County Road 51 in Perham Township of Otter Tail County; and WHEREAS, Minnesota Statute 349.213 provides that the Gambling Control Board may not issue a premise permit unless they receive a resolution from the Otter Tail County Board of Commissioners approving the application for a permit; and WHEREAS, the Otter Tail County Board of Commissioners is aware of no reason to oppose the conduct of lawful gambling by the Perham Lions, Perham, MN, at Zorbaz, located at 45738 County Road 51 in Perham Township of Otter Tail County. NOW, THEREFORE, BE IT RESOLVED, that the Otter Tail County Board of Commissioners hereby approves the conduct of lawful gambling by the Perham Lions, Perham, MN, at Zorbaz located at 45738 County Road 51 in Perham Township of Otter Tail County, provided the applicant meets all the necessary criteria for the licenses and permits as required by the Gambling Control Board. IT IS FURTHER RESOLVED, that notice of this application and approval shall be provided to the Township of Perham by sending them a copy of this resolution. Commissioner Mosher seconded the motion, and upon being put to a vote, was unanimously carried. Adopted and signed this 28th day of March 2006. Dated: __ 3_k=-~,-.c./4~?-__ _ OTTER TAIL COUNTY BOARD OF COMMISSIONERS r ommissioners Chair OTC Board of Commissioners' Minutes March 28, 2006 Page 10 Premise Permit Otter Tail County Resolution No. 2006 -25 Commissioner Nelson offered the following and moved its adoption: WHEREAS, the responsibility for the regulation of lawful gambling and the issuance of licenses and permits for the conduct of lawful gambling lies with the Minnesota Gambling Control Board; and WHEREAS, the Ottertail Lions, Ottertail, MN, has made an application to the Gambling Control Board for the purpose of conducting lawful gambling at Amor Rumors, located at 30932 Larson Rd in Amor Township of Otter Tail County; and WHEREAS, Minnesota Statute 349.213 provides that the Gambling Control Board may not issue a premise permit unless they receive a resolution from the Otter Tail County Board of Commissioners approving the application for a permit; and WHEREAS, the Otter Tail County Board of Commissioners is aware of no reason to oppose the conduct of lawful gambling by the Ottertail Lions, Ottertail, MN, at Amor Rumors, located at 30932 Larson Rd in Amor Township of Otter Tail County. NOW, THEREFORE, BE IT RESOLVED, that the Otter Tail County Board of Commissioners hereby approves the conduct of lawful gambling by the Ottertail Lions, Ottertail, MN, at Amor Rumors, located at 30932 Larson Road in Amor Township of Otter Tail County, provided the applicant meets all the necessary criteria for the licenses and permits as required by the Gambling Control Board. IT IS FURTHER RESOLVED, that notice of this application and approval shall be provided to the Township of Amor by sending them a copy of this resolution. Commissioner Mosher seconded the motion, and upon being put to a vote, was unanimously carried. Adopted and signed this 28th day of March 2006. Dated: 3&1h(,, OTTER TAIL COUNTY BOARD OF COMMISSIONERS ' ng, Board of Commissioners Chair Attest:_...L::.~~LLd,~?h...- Lar Premise Permit OTC Board of Comm1ss1oners' Minutes March 28, 2006 Page 11 Otter Tail County Resolution No. 2006 -26 Commissioner Nelson offered the following and moved its adoption: WHEREAS, the responsibility for the regulation of lawful gambling and the issuance of licenses and permits for the conduct of lawful gambling lies with the Minnesota Gambling Control Board; and WHEREAS, the Ottertail Lions, Ottertail, MN, has made an application to the Gambling Control Board for the purpose of conducting lawful gambling at Lenny's Dining and Dancing, located at 30255 Phelps Rd in Maine Township of Otter Tail County; and WHEREAS, Minnesota Statute 349.213 provides that the Gambling Control Board may not issue a premise permit unless they receive a resolution from the Otter Tail County Board of Commissioners approving the application for a permit; and WHEREAS, the Otter Tail County Board of Commissioners is aware of no reason to oppose the conduct of lawful gambling by the Ottertail Lions, Ottertail, MN, at Lenny's Dining and Dancing, located at 30255 Phelps Rd in Maine Township of Otter Tail County. NOW, THEREFORE, BE IT RESOLVED, that the Otter Tail County Board of Commissioners hereby approves the conduct of lawful gambling by the Ottertail Lions, Ottertail, MN, at Lenny's Dining and Dancing, located at 30255 Phelps Road in Maine Township of Otter Tail County, provided the applicant meets all the necessary criteria for the licenses and permits as required by the Gambling Control Board. IT IS FURTHER RESOLVED, that notice of this application and approval shall be provided to the Township of Maine by sending them a copy of this resolution. Commissioner Mosher seconded the motion, and upon being put to a vote, was unanimously carried. Adopted and signed this 28th day of March 2006. Dated: __ :3..J..1/c;"'-~-"-&>.~/o:'...l!t;ec._ __ _ • OTTER TAIL COUNTY BOARD OF COMMISSIONERS g, Board of Commissioners Chair OTC Board of Commissioners' Minutes March 28, 2006 Page 12 Barlow Project Lawsuit Settlement Otter Tail County Resolution No. 2006 -27 Commissioner Froemming offered the following and moved its adoption: WHEREAS, Otter Tail County was engaged in a lawsuit with Todd and Wadena counties and the City of Perham vs. Barlow Projects Inc.; and, WHEREAS, Barlow Projects asserted counter claims against the counties and City of Perham; and, WHEREAS, mediation took place and a mediated Settlement Agreement and Release (Exhibit A) was agreed upon; and, WHEREAS, to implement the Settlement Agreement and as part of further negotiations with the defendant, Barlow Projects Inc., a Miller-Shugart Stiplulation (Exhibit B) was agreed upon; and, WHEREAS, a Miller-Shugart Assignment (Exhibit C) of any claims or rights Otter Tail County has with Minnesota Counties Insurance Trust to the defendant, counter claimant, Barlow Projects Inc., was agreed upon; and, NOW, THEREFORE, BE IT RESOLVED, that because the settlement is reasonable, the Otter Tail County Board of Commissioners approves the settlement agreement as set forth in the aforementioned documents. BE IT FURTHER RESOVLED, that there are no further written settlement documents, because the documents are thorough and cover all grounds and contingencies. BE IT FURTHER RESOLVED, that the Otter Tail County Board of Commissioners authorizes the appropriate County Officials signatures to execute the aforementioned documents. Commissioner Mosher seconded the motion, and upon being put to a vote, was unanimously carried. OTTER TAIL COUNTY BOARD OF COMMISSIONERS roemming, Board of Commissioners Chair County Attorney's Office Promotion Motion by Mosher, second by Block, and unanimously carried to approve moving the Assistant County Attorney II position of Nicole Hanson to an Assistant County Attorney I position effective March 1, 2006, as recommended by the County Attorney. OTC Board of Comm1ss1oners' Minutes March 28, 2006 Page 13 Reappointment -West Central MN Housing Partnership Motion by Nelson, second by Froemming, and unanimously carried reappoint Wendy Merrick to the Board of Directors for the West Central MN Housing Partnership effective March 1, 2006 through February, 2009. Adjournment At 12:48 p.m., Chairman Froemming declared the meeting of the Otter Tail County Board of Commissioners adjourned until 9:30 a.m. on Tuesday, April 4, 2006. Dated: 3Pt'fay OTTER TAIL COUNTY BOARD OF COMMISSIONERS ;,) Attest b';f a LarryKr hn, Clerk g, Board of Commissioners Chair CB/kd 3/28/2006 12,00,25 OTC Board of Commissioners Minutes March 28, 2006 Attachment A, Page 1 OITER TAIL COUNTY AUDITOR PANELSON RECEIPTS AND DISBURSEMENTS SYSTEM WARRANTS FOR PUBLICATION IFD66 COUNTY 56 PAGE 1 WARRANTS APPROVED ON 3/28/2006 FOR PAYMENT 3/28/2006 VENDOR NAME ACS ART N SIGN INC BAKKE ACOUSTICAL BEAR GRAPHICS INC BIOCONTROL NETWORK BRANDT & MAGNUS P.A. TIM BRENNAN BRETZ HARDWARE MARLENE CARLSON CARQUEST AUTO PARTS CONVERGENT STORAGE SOLUTIONS COOPERS TECHNOLOGY GROUP CORPORATE TECHNOLOGIES CUTLER MAGNER COMPANY DACOTAH PAPER COMPANY DENZEL'$ REGION WASTE JNC ECONO SALES AND SERVICE SCOTT ERDMAN MAYNARD FALK FERGUS FALLS MEDICAL GROUP FERGUS FALLS NEWSPAPERS INC FERGUS FALLS SMALL ENGINE & TR CITY FERGUS FALLS FERRELLGAS FINNEY CO BOOK DIVISION FORCE AMERICA FORKLIFTS OF MINNESOTA INC fi"OTH & VAN DYKE FRESHWATER SOCIETY GALL'S INC GOODIN COMPAllY HALIFAX CORPORATION HALL GMC INC MIKE HANAN HEDAHLS HEADQUARTERS HIGH PLAINS TECHNOLOGY TERRY HOFF HOLIDAY INN ST CLOUD SHELDON HOLM INNOVATIVE OFFICE SOLtrrIONS LL UJTERSTATE ENGINEERING INC J CRAFT DIV OF CRYSTEEL MFG IN KELLY SERVICES INC ,JILL KLUCK KIM KNUTSON KRIDER EQUIPMENT DARREN KUNZ LAB SAFETY SUPPLY INC AMOUNT 1,013.00 279. 03 210. 00 3,513.51 387.12 1,944.83 3 82. 94 28.38 9.00 74.05 23,161.38 172.49 20.00 31,447.97 107.09 1,015.41 693.50 9.00 160.00 2,548.00 156.00 39.93 1,162.87 113.20 2!?9. 25 874.45 9.68 21,540.56 550.00 64. 51 81.41 74.97 104.34 206.69 48.66 57.51 42.07 268.80 121.93 358.52 LAP.RY OTT 1NC TRUCK SERVICE 23,260.52 169.77 2,069.05 36.91 9.00 3,261.56 9.43 60.18 515.00 OTC Board of Commissioners' Minutes March 28. 2006 Attachment A. Page 2 3/28/2006 12:00:25 OTTEP. TAIL COUNTY AUDITOR PANELSON RECEIPTS AND DISBURSEMENTS SYSTEM WARRANTS FOR PUBLICATION TFD66 COUNTY 56 PAGE 2 WARRANTS APPROVED ON 3/28/2006 FOR PAYMENT 3/28/2006 VENDOR NAME LITTLE FALLS MACHINE INC LOCATORS & SUPPLIES INC LARRY MARTINSON MCKINLEY ELEMENTARY SCHOOL MILLER'S PRECISION ENTERPRISES MINN KOTA COMMUNICATIONS INC MN CO INSURANCE TRUST MN MOTOR COMPANY MN OFFICE OF ENTERPRISE TECHNO MN PESTICIDE INFO & EDUCATION MONITOR TIRE DISPOSAL INC NELSON FORD LINCOLN MERCURY IN NORTHERN SAFETY TECHNOLOGY INC NUMARA SOFTWARE INC OLSON OIL CO INC OTIS ELEVATOR CO OTTER TAIL CO PUBLIC HEALTH OTTER TAIL CO TREASURER OTTERTAIL AGGREGATE OTTERTAIL TRUCKING INC OVERLAND MECHANICAL SERVICES PBCC PERSONNEL RESEARCH SERVICES PITNEY BOWES POSTMASTER PRODUCTIVE ALTERNATIVES INC QUILL CORPORATION REED BUSINESS INFORMATION RINGDAHL AMBULANCE SERVICE P.OYAL TIRE INC SEWER SERVICE SIGELMAN STEEL & RECYCLING INC SIMPLEXGRINNELL LP SIRCHIE STEINS INC STEVE'S SANITATION INC STRAND ACE HARDWARE STRATEGIC EQUIPMENT SYNERGY GRAPHICS INC TRANQUILITY BUILDING SERVICES UNIVERSITY OF MN VICTOR Ll.Jl'IDEEN COMPANY VIKING OFFICE PRODUCTS WADENA CO SOCIAL SEP.VICES WALLWORK TRUCK CENTER WALTERS PHOTOGRAPHY RANDY WASVJCK WEST OTTER TAIL TOWNSHIP ASSOC WOESSNER COUSTRUCTION INC AMOUNT 1,710.66 169.95 8.28 60.44 55.61 2,188.58 543.00 329.88 1,200.00 125.00 1,962.40 382.50 106.23 975.01 49.78 90.48 227.50 470.91 7,392.50 9,105.20 21.09 1,584.72 6.00 1,462.25 70.00 96.65 70.23 1,291.08 1,225.00 1,089.09 65.00 103.13 2,869.12 510.73 1.538.63 548.76 5.85 146.92 242.84 452.63 870.00 7.24 116.29 100.00 651.01 21.81 10.00 210.06 64.00 3/2B/2006 12,00,25 **** OTC Board of Commissioners' Minutes March 28, 2006 Attachment A, Page 3 OTTER TAIL COUNTY AUDITOR PANELSON RECEIPTS AND DISBURSEMENTS SYSTEM WARRANTS FOR PUBLICATION IFD66 COUNTY 56 PAGE 3 WARRANTS APPROVED ON 3/2B/2006 FOR PAYMENT 3/26/2006 VENDOR NAME AMOUNT FINAL TOTAL ...... . $165,347.51 •••• SETTLEMENT AGREEIHENT AND RELEASE OTC Board of Commissioners Minutes March 28, 2006 Exhibit A, Page 1 This Mediated Senlement Agreement and Release (Agreement) is fully effective as of March 8, 200, and is entered into by Todd Coumy, Wadena County and Oni:r Tail County (collecuvely referred to as '"Counties"), the City of Perham, M1nn.:sot::i (City), and Barlow Projects. Inc., on behalf of its orficers. employees, direclors, shareholders, successors, insurers, assigns and subrogees (hereinafter sometimes ref~rred to as ''Barlow"). The Agreemenl adJresses and resolves c1aims arising from or relatmg to the dc:sign, construction. operation and maintenance of the Perham Resource Recovery Facility (the Project). RECITALS A. The City and Cuu.nties asserted breach of contract, professional negligence, negligence, Misrepresentation and related claims against Barlow seeking damages in connection with the design, cons1ruc1ion, maintenance and operation of the Project. Barlow asserted counterclaims against the City and Counties seeking damages including but not limited to claims for lortious interference of contractual rela1ions and prospective economic :idvantage, claims for p:iyment or past due accounts, bre:ich of contract and rel:ited claims, all as sel out in its counterclaim. These claims as and between the Counties, City and Barlow are currently pending in the United States District Court, for the District of Minnesota. All cl.iims as and between Ba.r]ow and the City or Counties tbat arise from or relate to the Project sh:ill be referred to as the Actions 8. The City, County and Barlow each deny lrab11.i1y for the claims arising from the design, construction, maintenance, operation. repairs or any related services or materials provided for the Project. OTC Board of Commissioners' Minutes March 28, 2006 Exhibit A, Page 2 C. The: Counties, City and B:irlow now desire to settle all claims wh..ich have been asserted or which could have been asserted in thi: Actions with regard to the Project a.s more fully set forth below: FOR GOOD AND VALUABLE CONS[DER.;\ TION, the parties agree as follows: 1. RELEASE OF CLAIMS. A. ln consideration of the sums described in Paragraph 2 below, the sufficiency of which is hereby acknowledged, the Counties, City and B:i.rlow hereby unconditionally mutually release and forever discharge each oth~r, and each other's respective insurers (except for the MiMesota Counties Insurance Trust and other insurers of the Counl1cs), successors. parents, affiliates, agents, employees, dealers and distributors, and the officers, directors and assigns of each from any and all claims that were made, or could have been m:::ide in the= Actions of whatever kind or nature that is in any way connecled with the errors or omissions in development, design. consrru~tion, m:::iterials, equipment, advertising, m:u-keting, operation, maintenance or repair of the Project, including all claims past present or furore, known or unknown as between the Parties to this Agreement. It is the intention of the pnnies that this is a full and final mutual release of claims subject only to exceptions and tem1s as further set out in this Agreement. 2. CONSIDERATION. A Consideration for Barlow. Barlow's insurer agrees to make payment to Counties and City of the remaining limit of Barlow's Professional li::ibility insurance coverage under Gulf Underwriters Insurance policy 712-09-39, not to exceed OTC Board of Commissioners' Minutes March 28, 2006 Exhibit A, Page 3 SSOS,881.89. The amount of ilvail:ib!e insurance proceeds per Gulf Underwriters Insurance pohcy 712-09-39 (Proceeds) shall not be less than $800.000. Counties and City, co11ecti\rcly, shall pay Barlow $220,000. The City and Counties agree th.i.t such pa)ment shall be made by release of funds currently held in escrow for Barlm.,-for work provided at the Project In adJi1ion, Barlow further agrees to accept the Counties· stipulation to enrry of Judgmenl against Counues, jointly :md severally, and in favor of Barlow in the amount of One Million. five Hundred Thousand and no dollars ($1,500,000 00) in full settlement of their claims and as consideration for the other tem1s and conditions of this Agreement. Barlow agrees that it shall collect Uus $1,500,000 exclusively from the Counties' insurers pursuant to any apphc:i.ble policies The Counties and Barlow agree that this ''Miller v Shugart"' type settlement resolves all tort coun1erclaims asserted against the Counties. In the event that the insurance Proceeds provided to Counties a.re less than $800,000, the $220,000 due Barlow shall be reduced on a dollar for doll:i.r basis to lhe same extent :is the Proceeds arc under the SS00,000 level. B. Consideration extended by Counties . The Counties agree to accept p:i.yment of the Proceeds. The Counties agree to make payment of $70,000 of the Proceeds to City. The Counties further agree to stipulJ.te to entry of Judgment against Counties and in favor of Barlow in the amount of One Million, Five Hundred Thousand and no dollars (1,500,000.00) m full settlement of the 8.1Tlow tort Counterclaims and as consideration for the other tenns and conditions of this Agreement. County agrees that s:i.id Judgment will be collected exclusively from the Minnesota Counties Insurance Trust and/ or other insurers of the Counties. Counties further agree to assign to Barlow any 3 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit A, Page 4 and all claims they may have as against their insurers, including but not limited lo claims for defense, indemnity or otherwise consistent with a Miller,. Shugart t}pc senlement. C. Consideralion E).tended by The City. The City agrees to, in cooperation with County, make payment to Barlow of $220,000 subject to the tem1s of this Agreement. The City and Counties agree that such payment shall be made by release of funds currently held in escrow for Barlow for work provided at tlle ProJect. The city furtller agrees to make payment of $ I 0,000 to County toward payment of amounts due Barlow. Finally, City agrees to accept payment of$70,000 from Counties as City's share of Proceeds provided by Barlow. All payments made shall be made within I 5 days Ii-om tlle date this Agreement is approved by City and Counties. D. Miller v. Shugart type settlement. The Counties and Barlow agree that based upon the merits of Barlow's Tort Counterclaims, its alleged damages and evidence thereof, 1he risks of the Counties going to trial on said counterclaims and other relevant factors, that the Miller Shugart type settlement is reasonable. The amount of said Miller Shugart agreement was the result of extensive negotiations between Barlow and Counties. The Counties and their counsel will provide cooperation as is reasonably requested in connection with seeking court approval and entry of judgment per the Miller v. Shugart settlement. The Counties and their counsel shall also cooperale with any efforts by Barlow to recover from the Counties' insurer. 4 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit A, Page 5 E. Exceplions. Notwithstanding anything to the contrary in this agreement. the P::Irties are not releasing any claims 1hat may arise in the future regarding the alleged infringement or any patent or violation or terms of the License granted by Barlow to Counlies and City regarding the Proj1::ct. The Counties and City shall continue to utilize the said license or inrellet:tual property licensed by Barlow for lhe Project during the remaining tenn of the hcense, but shall owe no fee therefore. Barlow agrees to sell replacement parts :ind provide technical support services to City and Counties per its usual and customary rates. Counties and City further agree tlus Agreement releases claims ber.-.·een them for Merchant Tipping dispute and other Disputed Items through December 31, 2004, but that this Agreement does not apply to such disputes subsequent to that date. 3. NO ADMISSION OF LIABILITY. The parties recognize and agree 1hat this settlement is the compromise of disputed claims and that the considc:ration accepted and paid hereunder 1s not iotended nor shall it be construed by anyone to be an admission of liability by or on behalf or any of the parties, by whom all such liability is e.~pressly denied, said panics intending by this settlement merely to avoid litigarion and buy their peace. 4. LIABILITY OF SETTI.ING PARTIES EXTINGUISHF.D It is understood and agreed 1hat thi: pwpose, intent and legal eITect of this Agreement 1s to extinguish the entire li::ib1hty or lhe City, Cow1t1es and Barlow arising out of or in any way connected with the Project, the Actions and the claims released in this Agreement. The City stipulates nnd agrees that 1t shall defend and indemnify Barlow 5 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit A, Page 6 and Counties from any claims asserted by Tri-County with respect ro the $220,000 payment to Barlow or the Disputed Items resolved by this Agreement. 5. BINDING EFFECT. The lenns of this Settlement Agreement and Release shall be binding upon and be enforceable against and shall inure to the benefit of the parties hereto jointly and severally and the heirs, successors, personal representatives, and assigns of each. The parties hereto acknowledge that th.is Agreement w:is the result of a mediation conducted by Mark J. Heley (the ··Mediator'") and that they each received in writing the statutory mediation disclosures including the following: • the MediJtor has no duty to protect their interests or provide the parties with infonnation about their legal rights; • signing a medi:ited settlement agreement may adversely affect the parties' legal rights; and • parties should consult an attorney before signing a mediated settlement agreement 1fthey are uncertain about their nghts. 1n entering this Settlement Agreement the Counties, City and Barlow represent that they have relied upon the advice of their allomcy, who is the attorney of their own choice. concerning the legal consequences or this Medi:i.ted Settlement Agreement and Release; that the tenns of the Mediated Senlement Agreement and Release have been completely read and explained to the Counties, City and Barlow by their attorneys; and that the terms of this Mediated Release and Settlement Agreement arc fully understood and voluntarily accepted by the Counties, City and Barlow. 8. ENTIRE AGREEMlsNT 6 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit A, Page 7 Counties, City and Barlow further understand and agree that Ibis documenl contains the entire :;igreement between Counties, City and Barlow with respect to the Claims, and that the terms or th.is Mediated Settlement Agreement and Release are contractual and not a mere recital. By their signatures below Counties, City and Barlow each represent that they have carefully read this document, know and understand the tenns 3!1d effect hereof, have fully discussed the terms and eITect or this document with their attorneys, and have signed this Seulement Agreement and Release as 1beir free and considered act. 9. ENFORCEMENT Releases do not apply to claims regarding enforcement of this Mediated Settlement Agreement, and each Party shall be entitled to recover attorneys fet:s and costs incurred to enforce this Mediated Settlement Agreement. 10 APPROVAL Th.is Agreement is contingent only upou its formal approval by the City and Counties by the applicable governing body. The undersigned representatives of the City and Counties agree they bave negotiated the terms of this Agreement in good faith, believe the terms to be a reasonable and fair settlement and resolution of claims, and further agree to recommend approval of the senlement to the City Council or County Board, and have a good faith belief th.is Agreement will be approved. City and Counties agree lo advise other parties within 3 days of appro\·al, and payment shall be due within 15 days of approval. Upon approval by City and Counties, th.is shall become a binding and enforceable agreement. The P:irties to th.is Agreement agree to cooperate in the creation of a formal 7 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit A, Page 8 Senlement Agreement and Release, creation or implementation of a Miller Shugart type agreement, preparation of a Stipulation of dismissal with Prejudice or entry of judgment consistent with the terms of this Agreement. In the e-·ent of any disputes regarding final language required to implement the terms of this Agreement, the Parties stipulate the Mediator shall have final authority to resolve disputes consistent with Mediator's understanding of the Parties' intentions. [BALANCE OF PAGE NOT USED] 8 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit A, Page 9 TODD COUNTY, WADENA COUNTY, OTTERTAIL COUNlY Dated: -'1_}'-'f'-------· 2006 9 Dated: _1~/~~----· 2006 Knsti Hastings Pemberton, Sorlie, Ru Fer & Kershner 110 Mill Street N. Fergus falls, MN 56537 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit A, Page 10 CITY OF PERHAJ\I Dated: _______ , 2006 Dated: _3--+{_i~--· 2006 Dated: __ a=+l~Er~---' 2006 I 10 Dated ------~ 2006 ~ Its Cd,v jiff' ,q.-o4zP& By Its A ttomeys Dennis Happel Perham City Attorney 125 2nd Ave. NE Perham, MN 5657) ~~el.fl r. e~e" f>"""I ~u.ver.s Jeff Egge Iverson Reuvers, LLC 9321 Ensign Ave. S. Bloomington. MN 55438 OTC Board of Commiss,oners' Minutes March 28, 2006 Exhibit A, Page 11 BARLOW PROJECTS, INC. Dated: _______ . 2006 9fa Dated· _'J~/)-f ____ . 2006 Dated: MA.,,-, ~ , 2006 BY its Insurer Gulf Underwriters Insurance 11 Dated: _______ • 2006 B_,,_ ----------- Its ___________ _ By !rs A uomeys RM<lyullickson Joe Anthony Anthony Ostlund and Baer 90 South Seventh Street Minneapolis, MN 55402 W. Todd Hagg:irt Vogel Law Firm 218 Np Ave. Fargo, ND 58102 OTC Board of Commissioners Minutes March 28, 2006 Exhibit B, Page 1 UNITED ST" TES DISTRICT COURT DISTRICT OF MINN ESOT.s Todd Counry. WaJen:i Coumy and Oller Tail Coumy, Mumc1pal subd1\1sions of !ht: Sme of t-.:lmneso1a, Pl:unr1ffs!Counrercla1m Dcti:nd:m1s, VS Barlow Projec1s, Inc., a Colorado corporat1011, Dt: fendanrtC ounterc \a1mam A. Recital of S1ipulatcd Faris Ci\JI i\c11on No 0-4-CV-4~ 18 . ..\Di\.URLE MILLER-SHUG\RT STIPULATION Plaimiffs.'Coumerdaim Defrm.la1us Todd Counry, W::i.dena Cou111y, u11d Oner Tail County (collcc11vc\y, tbc ··counries") are niunicip:i.l subd1V1s11.lns of 1he State of M1nnes01a 1 Defond:int/Coumcrck11man1 B.:irlow ProJt:CIS, Inc CBarlov. ") 1s a Colorado corpor:iuon. It 1s an energy services compan)' invol••ed in the dcvclopmem and opcnmons of wasle-to-em:rgy facililies 3. Bailow, 1hc Counlres. and the City of Perham. Mumesorn l'"C11y'') have l;i..:-en mvolved i11 the rc1rofit and opi:rat1ons ofl municipal sohd w:.1ste combus11on facility located Ill Perham, Minnesota tthe "Fal·ilny··). 4. The background fac1s and alkgations g1vmg nse to the parties' dispute arc m forth m more de1::irl III lhe Complaints and Amended Complaints and 1hc Answer and Countercl.:ii1ns and Amt•ndl!d A11s,.,, l!r and Counterclaims filed m 1his ::iction and ma re laced action, C1tv of Perham v 8ar)ow Pro1ec1~ In.:., Court File No. 04-CV-4220 (ADJ\t/RLE) Barlow has asserted coun1erclaims against rhe Coun11es. spec1iical\y mdudmg ton d:ums for OTC Board of Commissioners' Minutes March 28, 2006 Exhibit B, Page 2 1ort1ous interference with contr.ict and 1.:irtious m1erfcrence with prospecnve economil'. advantage. 5. Bario'-'' Jnd rhe City wer~ p.irt1l!S lO sevl!ral c.:>ntraccs pursuant to which Barlow retrofitted lhc Facilnv. served as the Operator of the Fac1\ity, and provided cons1ruction services to fac1htate steam supply ro a sceo.m customer of tl1e F.ic1h!y. 6. Each of the Counties J.!so entered into co111racts \'f1lh the City. These Agreements es1ab!Jshcd the rinanc1al mechanisms to pay for 1he retrofit of the Fac1lily and established the rights :ind obhga1ions between the City and the Coun11es with respect ro the revenues from and cos1s of operating and m.1in1aming 1he Facility Under the agreements, the Counties agreed to deli,er and lhe Ci1y agreed to accept for processing al 1he Facility acceptable waste al on t:Sllblished 1ippi.ng kt:. The Counues contracted for a ccnai11 percenragl~ c:i.p:icity of the Fac1li1y with the Cil}' responsible for contracting enough wJsle to satisfy the rem:iinmg: cap!l.city. The City pledged the net rt'venucs or the Facility ror plyment of the bonds, which the Counties took thr: gener!l.l oblig3.11on to pay for tbeir allocable shares of the debt service paymenr on the bond. 7. Under the April .'.!001 Operations and Managemeo1 Agreement ("O&M Agreement'') between the City and Barlow, B::1rlow served 3$ the Operator offacility for an initial term often ~-ears. subJecr to automatic rcnewJI for two addic1onal ti\'e year periods. Under tbe O&M Agreemem, Barlow was to be paid a momhly Operiltor ft'e beginning at $78,000 per month, subJecl 10 mnauonary increases, as wdl as an Energy Re\cnue Bonus, based upon the generation and sale ofstc.am and/or electrirny such Illar combined energy revenues exceeded proJected revenue's. 8. Pursu!l.nt to .1 January 2004 Construl·llon Services Agreement between th.: City ilnd B.1rlllw, Barlow completed tl1e consrruction of a s1e:im lme improvement 1.11 2004 Barlow OTC Board of Commissioners' Minutes March 28, 2006 Exhibit B, Page 3 invoiced tht" C11y for i1s services. but the City did nol pay appro:-.1mately S.222.000 of lhe invoiced amount 9. In Sep1ember ~004, the C11y rennm3ted 8::irlow as the Opera1or of the Facili1y and, :1s a result. B.irhJw's rok as Operator ended on O('lober 15. 2004 As J. re~uh of said ternnn::ll1on, Barlow was not paid beyond Ocrober 15. 2004 for either !he monthly Opera1or Fe~ or the Eni:rgy Revenue Bonus 10 which 83rlow WllUld have 01herw1sc beC'n c-nrnled dunng rhc term of the O&M Agreement In J.dd11ion, the City failed ro pay 10 Barlow approximaiely .$212.000 billed in C01U1ec1ion wi1h the-constrncuon work performed on the stcJm lme improvement. 10. ln 1ls counterd:11ms agemst (he Counties. Barlow ass!!ned. among ocher 1hrngs. lhat the Counties tort10usly inlertCrcd wi1h Barlow's contra~t~ w11h 1he City and us ~rsp<~nve econonuc advantage from its anticipated long-term role as lhe Operator of the Facili1y II Liabilin· Insurant't'. During rhe rdevant rime pii!nod, th< Minnesola Counties Insurance Trust ("MCIT .. ) provided hab1h1y mswlm:e coverage to each of the Counties, Among 01her coverage. t.he Pohcy !or each County provides C0\·e1age for public official liability coverage, wnh hmns of$300,0tJ0 per claimant and $1,000,000 per wrongful ac1. The Counties tendered the ~ountcrclaims Jg:iinst them 10 MCIT for ilab1llty cm·crag.e and'or defense pursuJnc to the above-referenced msur:rnce policies. MCIT un multiple occasions d~n1cd any cover:i._ge and dechned h) pronde any defense 10 any of1he Counties In shon. ~!CIT refused to pby any rok in this lawsuit or tlie resolu[!On thereof 12 Liabilitv for Claims. Barlow mtends to imroduce at trial evidence rha1 each of lhe C0un11es improperly imerfl:'red wnh B:ulow·s comracts aod future busmes~ e.,pec1:mc~' and economu: ad\·anlage from its rclat1onsh1p w11h th~ C11y by, among other things, mducing the City J OTC Board of Commissioners' Minutes March 28, 2006 Exhibit B, Page 4 to ternunate Barlow a:; th!!' Opcralor of the Fac1hty and to withhold payment of the appro.\imately $222,000 in co1111ect1on \\ itl1 construcnon Sl!n.ices c111 the steam lme Barlow intends 10 introduce evidence from which a reas .. :mable Jury could conclude 1ha1, but for tort1ous condui:t by c:ach of1hc Counucs. lhe C11y would not h:m: termi.rutcd Barlow as an Oper:Hor of the Facility and that Barlow would be entitled to payn1ent of the Operator Fee aud Enc:rgy Rev~nue Bonus for 1he anticipa1ed term of the O&M Agreement. Tbe Counties acknowledge that thcre woulJ be a substanlial risk that a jury would conclude: that the Counties are lt:g:ally liable LO Barlow as a resuh of Barlow· s tort counterdaims ag:unst them 13. E~tenl of Qam:1ges. Barlow's claims for dam1.ges on its coumerck11ms indude lost profits 10 which 1t would have earned as Operator of the-Facilir:,.,. including 00th tht: Operator Fee and the Energy Revenue Bonus under the an1ic1pated long-term relationship w11h lhc 1.:ity under 1he O&M Agreement. Barlow's e;,.pert wirnesse:i, two cen1fied public accountants from the nat!On:il accountmg firm oFRSM McGladrey, have cJlculJted these darroges to be m the amount ofappro:\.imately $5,700.000. In addition. Barlow has claimed and m1ends ro introduce al tnal cv1denct: 1hal either as an alternative or in addition to these lost profits, Barlow is entitled to recover the sum of$850.000 For technology licensmg fees based upon the manner m which the O&M Agr.:ement was purportedly terminated at the rnstiga1ion of the Counties, approximately $222.000 (plus mrcrcst) for amounts unpaid m conm:c11011 with 1he construction of rhe ste.:1m line improvement, and additional amow11s e:-::ceedmg SI 00,000 for tn\estments b)' 8.:1r!ow in tht: open11ons ::md efiiciency of the fac1l1ry upon the C'<pecta11on of its con1111ucd rolt: ns Op~rator of the Facility. 14. The par1ies agrel! 1h01 a res.sonable jury pr,:~ented with Barlow's e\'idencc could find each oftht: Coun1ies liable on Bailow's ton C"oumercla1ms and that it could find damages ut 4 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit B, Page 5 an ::rnh>Unr in e:-.ccss of:S6.000,000 (subji;:ct to reduction purs1..1a111 to the maximum liahility limns under Mmn Stat ~ 566 04) In Jdd1tion. smce MCIT has refused to provide the Countirs with J defense, there is a substantial nsk th:H Jn ultimate jt1dgm~nt would be entered against each of1he Courttil!s that. when combined with the addirional o.rcorneys· fees and lltigut1on e'\pcnses that would be incurred by the Coumies in de rend.mg B:ulow's coun1erda1m through mal and potential appeal, would be more than the amount ofinsur::mcc-coverage under [he MCIT's policies The parties agree thal a Judgmeal ITT favor of Barlow :md o.gainsr each Coucty severally, m the amount of$250,000 lDr a 101al of:$750,000), together with costs and disbursements, 1s a rC."Jsonable compromm· and Sl!ttlement ofB:1rlow's tort counterclaims ag:imst the Counties. in coruadcr:il1on of issues ofhnbihty and damages :md the nsk and expense of going to trial. A verd1c1 and JUdgmenl agai.nst the Coumies th:it 3111ount of the pohcy limits with their insurer would expose the Counties to a substantial judgment. which. when combined with HS Jllornl!)-S' fl!es and litigation cicpcnses. would be in c.\cess of insurance polic)" hm11s This cr~:::il~s a s1rong interest and present strong motivation for the Coun11cs lo settle the countercllims of Barlow. 15. Settlemenl/i\lediation The panies pamc1patcd in :i 15-hour mediation before Mediator Mark Healy on March 8. 2006. and engaged in :idd!Tlonal settlement discussions regarding the tenns or1h1s Miller-Shug:irt Stipula1io11 smce the mediation The amounts or the sC'nlement betwi.:en Barlow and the C oun11cs "i1\1 r!!spec\ 10 B:irlo\\·'s counterclaims were the subject ofeictcnsive negoti:it1ons anJ compromise. 16. Insurer's Failure to Offer Sellll'ment. MCJT has refused to partic1pa1e in lh1s l111ga11on. refusing to provide ~ith~r any coverage or de-f~nst: 10 the Counties, :ind :is a result has 5 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit B, Page 6 not made an}' offer to ~nle Barlow's counrercl:iims ag::unsl the Counties, thereby e-xposmg the Couot1es to liab1h1y 1f J judgment 1s ultimately rendered against 1hem, J.S well as further attornl!ys' fees and li11gation e:11.p~nses. 17 Jnsurer·s Breach o( Dut\', The failure of MCIT tci pr0\'1de any coveragl! and/or defense of B.irlow·s counterclaims against 1he Counties and/or to negoti3tl! a st:ul~ml!'llt or extend any offer ofsettlemenl to B.irlow 1s v1ewt:d as a breach by thi:-insurer of its duty lo prov1dt: coverage and a defense to the Counties a.nd tts du1y to altempt in good faith h> St:Ule the cl:iims of Barlow agamst 1hc Coumies Moreo\'er, s:iid failure constitu1es a failure by the insurer to discharge its duty to properly balance the interest of the CounLies against its awn. The Counties are, as a result, relieved of their duly and obliga1ion under lhe contracts ofmsur:mce \',•i1h the insura, including the duty ofcooper:it1on with the insurer. 18. Trial Date and Desire for Resolution. This case hJS been set 10 be trial re:i.dy by July 31, :!006. Counsel for Barlow and counsel for the Counties ha Ye thoroughly considered che [Jets and the !aw and have analyzed this li1ig:111on which is now pending: be1ween these parties and have concludt:d that it 1s in the respective best tnterests oft:ilch of these parties to resol\'e at this lime any uncertainty m the pending l11iga1ion 19. Stipulatjqn for Judgment. Each of the Cou1111es hereby stipulates and agrees to entry of Judgment in favor of Barlow .:,,nd agains1 each County, seYerally. in th.:: following amoums 6 Oner Tai! C0unty Wadena County Todd Coun1y $150.000 Q0 ScSIJ,000.0U Sc50,000.U0 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit B, Page 7 for a tulal of$750,000 00. 1agerher with costs and disbursements, which represent a frur and reasonable Judgmeni m 1,1,:w oflhe unccrrain11es of the ddc-nses to tht: counrercb1ms and I isks of llligaLio11 This Stipubuoa for Judgment is entered by e::i.c-h or'the Counties upon the condH1on that Barlow agrees that its Judgment may be sauslicd only from liab1\11y insurance policies u1 force Jt the rc-lev:rnt t11nc periodts) and thJI this Judgment is not satisfied from nor mav 11 b~ :.i lien upon any Other assels of the Counties B. ConnanlS of the Partiec;. ln consideriltion orthC' forC'going. stipu!::itions and of the following covenants, the panies hereto :igree and covenant as follows: "'ai\.·er of Jur.r Trial. The Counties hereby e.\pressly waive any ngbt 1ha1 they ha-..·e m this action to mal by jury regard1I1g Barlow's counterclaims or thc-ir defenses thcrl!'to 2 [n1n· of Judgment Each of the Countu:s :.1grees to entry of judgment in favor qf plaintiff and against each Count}', severally, in the fol!owmg amounts: O!li:r Ta,I County W:i.dena County Todd County $250,Q00.00 $251),000 uo $250,000 00 for a total ofS750,000.00. together with coses and d1sburscmen1s 3 N:lture-of Judgmenl. Each oflhc-Counties acknowledges, stipulates, :ind ::igrees thlt Judgm .. ·nt \\ 111 be enren:d hy th!! Coun ag::iins1 cacl1 of 1ht>m in che amount set forth in rhe previous paragraph, and Barlow agrl!t:S 10 enforce said Judgments only U1 the mlnner described m paragraph 8(6) of1h1s Agrei:mem and Supulauon 7 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit B, Page 8 4. Ad\·lcc ofCoun.sel. Barlow and eo.ch of the Counties affirm that each has h.1d mdependeni advice of legal l'Ounsel as ro all m:itters discussed and set fonh herein. and that b:,,!,ed on such advice, the parti~s agrc:e that 1his Agrec:mcnt :ind Sripu'311on is a reason;ible o.nd prudent resolUlion of the controversy and cl:ums tllat cxisr between them in light of all the facts and circumstances. including the Counties' e'l:posure to a potc:nual verdict and judgment m e...:cc:ss oftht! pohcy llm11s afforded by app\1cablc: in.sur:::mce policies. S Agr~cmcnl 10 1\ssign Claims. In further consideration for this Agreement and St1pula11on. and as an integral pan of this Miller-Shugart setllemenl, within ten ( 10) calendar d:.1ys of the date th:it the Coun enters judgm,:nt against lhl· Cououes, each Coumy will assign to Barlow, using tht' type of assignment attached hereto as Exhibit A, any and all claims or en.uses of action th;it :my of the Coum1es may hav..:: ag:iinst MCIT 1:md/or ::my other insurer ot the Counties) re being in any way to tbe countercla1m.s asserted in lhis action and/or said insurers' breach of any duti,:s O\\'ed to any of the Counties with respect thereto. 6. Agreement Nol lo Eu·cule Against Defend:rnl~. (a) Barlow will not e~ecure agamst the CoµpJies Barlow agrees thal ii will not exe-cute against the assets i;ir holdings of any of1he Counties with regard to the Judgment cn1cred by the Court berelll. (b) Reserv:111on o(Rjghl 19 Exe.;ute Agarnsr Insurer Barlow expressly reserves lhe 11ght to execute on the Judgment entered by the Court he-rein against MClT, or any other insur:incc company that has 1nsur:rnce coverag.: tha1 would rnd.:mn1fy any of the Coum1es for th,: counrcrcla1ms andi'or delC'nse ,..'f countcrcla1ms of Barlow herein. s OTC Board of Commissioners' Minutes March 28, 2006 Exhibit B, Page 9 7 Agn~·emenl Binding. 8Jrl0w and the Count1!!s agree that the prnv1s.11:,ns '-..,f1h1s AgreemenL ;:md S11pulat1on shJll be bmdmg upon 1;'.'3Ch of them, a'5 wcl! as thl!'ir respective 01licers, direclors, board members, admmi~lr:Hors. office holders, successors, assigns, ::i.gen1s. and anorneys. 8. Applic:iblc Law This Agre?mem and Stipulation shall bl!' i.mcrprctcd :lC\.·ordu1g to the law oftbl! State of Minnesota 9 Intent of lhe Parties It 1s 1he mtent of the parties hereto that this Agreeml!'nt and Stipula1ion has lhc effect of. and is irnended to protect their respl;'.'ctive intere"sts m the manner of, the case of Miller v Shugun. 316 N.W 2d 729 (Minn i 982) 10 E:ich of the Couories b~reby further agrees rh:u il will assign to Barlow any ng!Hs it has under 11s m~ur.:rncc polky(1es) with MCIT ~ind.tor any other msur~r with respect to 1he defense ofcounterc\a1ms m 1h1s matter, spec11ically mcludmg any claims for recovery of attorneys' fees 11. The parties herelo acknowled!!;e Lh:i.L 1he Assignment referenced in paragraph Bt5, 10) 1s be-mg made and delivered to Barluw m .:011s1dera111rn of1hc agreement and Sllpulation by Bario\~ that it ,.,,:ill not execute 011 the assets or holdings of the Counties 12. As p:irt of 1h1s Agreement, each of the Counnes hereby agrees co reasonably cooperate wirh Barlow and 11s attorneys in connect1on with any proceed mg undertaken by Barlow m pursuit CIT processing any claim sci fonh 1n the prec~ding paragraph by: (a) meeting wab B:ulow and/or irs anomeys 10 discuss the facts underlying each such 1.'.laim, bu1 re!-er,..es the right !C• assert the :i.norne)/d1ent pm·Llege, 1f applicabh:, and tt.l .:ommue co 3.55,=n all ocher applicable privllegcs: and (b) 1faskcJ by Barlo\v or 1cs attorneys. providing accurate cesumony as m::iy ~ rcqutred 111 any proceeding 9 OTC Board of Commissioners' Minutes March 28, 2006 Exhibit B, Page 10 13. ![ is understood by each of the Counties that rhe commitments and agreements undi:rtaken by them set forth in paragraphs B{l :!) above are a m.'.l.Terial part of the considernt1on for this Miller-Shugart Agr~cnlt'nt and Srtpula11on and that b1eo.ch of the provisions st't forth in paragraphs B( 12) sh:ill relieve Barlow from 1h,: Agreement regarding execution on the judgments d~scribed in paragraph 8(6} herein 14. Nntkr to Insure. Barlow will provide MCIT with written not1..:e of this Stipulatton Agreement and Stipulation within 10 days following C"Xecurion hereof. The parties acknowledge further Hun since the msurer h::is breached 11s duties to the Counties as described 1n paragraph A( I 7_J of this Agreement and Stipulation above, no duty lo prnvide such notic~ will be legJlly rtqutred, and further ch3.t the provision of such notice 1s not to be construe-d as an ildmissmn of any duty on the part of Barlow or any of the Counties. C. Exccurlon. This Mdler-Shugari Stipulation and Agreement m3.y be sigoed in one or more counterparts, each of which together shall constitute one original. Dated. March_, 2006 TODD COUNTY By: ________________ _ 11.;· _________________ _ Dated· March_, ~006 WADENA COUNTY By. _______________ _ hs. ________________ _ 10 Da1c:d M:i1ch . -2006 Dati:d: March , 2006 OTTERTAIL COUNTY OTC Board of Commissioners' Minutes March 28, 2006 Exhibit B, Page 11 By ______________ _ Its. ______________ _ BARLOW PROJECTS, INC. By ______________ _ Its.: _______________ _ I I OTC Board of Commissioners Minutes March 28, 2006 Exhibit C, Page 1 UNITED STATES DISTRICT COURT DISTRICT OF MfNNESOTA Todd County. Wadena County and Otter Tat! County, Municipal subdivisions of the S1a1e of Minnesow.. Plamt,ff, \'S. Barlow Proje1.:ts, Inc , a Colorado corporat1on, Defc:ndant. C1v1I Action No. 04-CV--12 IS A.DM1RLE MILLER-SHUGART ASSIGNMENT I. Esch of the Counties of Otter Tail. Wodena, and Todd /hereinafter the "Counties") for valuabh: t:onsideration, h~reby assigns to Barlow ProJects, lnc (hereinafter "Barlow·•), any claim which any of the Counties. individually or colk~tive\y, have or may have ago.inst M11rnesota Counlies Insurance Trust thereinafter "MCIT') and against any other insurance company which at any rime has wrirten insurance for any of the Counties that may provide protecuon for their ind1vidu:1I or collecti\·e obligations relaling to any of the counterclaims or allegations against the Countries in this action 2. It is the iment and purpo:;e ofth1s Assignment to penrnt B::i.rlow 10 prosecu1e in its n::i.me. and on its own behalf, any claims any of the Counties. individually or collectively. have or may have against MCIT or any other insurance company which provides insurance for claims th::11 might provide any of the Counties with prn1ec11on relating to any of the alleg::!tions or c!a1m.s m this action. The claims ass1gn~d 10 and which may be prosecuted by Barlow include bu1 arc not l11nited to: •I l 169$ OTC Board of Commissioners' Minutes March 28, 2006 Exhibit C, Page 2 ta) Cl3ims rhat t-.lCIT and'or other insurer anticipatvrily breached its duty to invc:stigate and evaluate the c0un1erclaims made by Barlow against the Counties; (bJ Cl::iims that MCIT or other insurer 3nticipatorily breached and/or actually breached its duty under applicable insurance policyr'iesJ to provide the Counties with coverage. indemnification and/or a defense with respect to Barlow's countc:rcli1ims herc:in; (c) Claims that MCIT and/or other insurc:r amicipatorily bre:iched and/or actually breached its duty to provide coverage with respect to Barlm1,.·s counterclaims ag.:imst the C1,unties herein and/or to offe1 scnlement or negotiate senlemenl of the counterclaims of Barlov, against the Counties. in good fauh. and {dJ Claims for bad faith against the fvlCrT and/or other insurer that may have had insurance coverage for the maNers herein. 3. As part of this Assignmenl, each of the Counties sh3ll reasonably cooperate \\."ilh Barlow and its attorneys, in connection with any proceeding undert3ken by Barlow in prCk:essmg any claims set forth m the preceding paragr3ph by: (a) meeting with Barlow and/or its 3tromeys to discuss the facts underlying any such claim, but resen·e 1he right to assert attomey/clienl privilege, 1f:1pphcable. and to continue to assert all other applic:ible privileges: and (b) if asked hy Barlow or its attorneys, providing true and accurate testimony as may be required in any proceeding. 4. The p:irties here10, each of which has been represented by counsel in connection wnh this Asstgnment. acknowledge thal this Assignment is made and is being executed and dc"livered to Barlow, in cons1dcrn.tion ofan agreement and Miller-Shuga.n Stipulation whereby Barlow agrees that 11s judgments may be Siltisfied only from liability insurance policies applicable 10 rhe counterclo.1ms asserte-d herem and rho.t sau.ljudgment OTC Board of Commissioners' Minutes March 28, 2006 Exhibit C, Page 3 will nol be sati!>fiable out of. n0r may be a lien upon, any other assets of any ,Jfthe Counties. and th:i.1 Barlow will nOl e.,t"1..·u1e against the assets or holdings of,:iny nfthe Coumies. on any judgment that may be or has been obtJinl"d in ccmnection \\.Ith the above action. 5. Each of the Counlies agrei;:::, and understands th,1t the commitments and agreements undertaken by th~m as set fonh in paragr:iph 3 above are a m;Heri:::11 part of the consideration for the Miller-Shwzan Agreement and stipulate that breach of dll)' of the provisions set forth in paragraph J shall relieve Barlow from the agrt:ement-s regarding execurion describl·d in paragraph 4 hereUl. 6 This Miller-Shugan Assignment may be s1~'lled in one or more counterp:ms, all of which logether shall constitute the-original Dated. Mar\.'11 . 2006 TODD COUNT\' Bv· ______________ _ !rs: ___________ _ Dated: ~larch_. :!006 WADENA COUNTY By. ____________ _ Its: ___________ _ ) OTC Board of Commissioners' Minutes March 28, 2006 Exhibit C, Page 4 Dated. ?,, larch_. 2006 Dal~d: M:uch . ::!006 4 ; OTTER TAIL COUNTY By. ___________ _ Its: _________ _ BARLOW PROJECTS, INC. 8)0 ___________ _ Its:. _________ _