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Home My WebLink About3G - Prj. 87-18 Fisher Ave & Library Parking Lot .. ... l "CELEBRATE PRIOR LAKE'S CENTENNIAL - 1991" DATE: 3 (g) BRUCE LONEY, ASSISTANT CITY ENGINEER CONSIDER APPROVAL FOR FINAL PAYMENT ON PROJECT 87-18, FISHER AVENUE AND LIBRARY PARKING LOT IMPROVEMENTS MARCH 18, 1991 CONSENT AGENDA: PREPARED BY: SUBJECT: INTRODUCTION The City of Prior Lake contracted with Albrecht Excavating, Inc. of Roseville, Minnesota for the construction of sanitary sewer, watermain, storm sewer and street improvements for Fisher Avenue from Carriage Hill Road to Hampton Street and for the construction of the Library Parking Lot from Erie Avenue to Main Avenue. The project work has been completed and during the course of processing the final payment, the contractor filed a Chapter 11 bankruptcy proceeding. The purpose of this Agenda item is to receive council approval of an Indemnification and Hold Harmless Agreement between the the contractor's bonding company, Transamerica Insurance Group and the city of Prior Lake in order to execute the final payment on this project. BACKGROUND: Albrecht Excavating, Inc. entered into a contract with the city on May 31, 1988. The city of Prior Lake's Engineering Department prepared the plans and specifications, and performed the contract administration on the project and has certified that the work has been completed according to the specifications. The contractor filed a Chapter 11 bankruptcy proceeding during the course of the project and the contractor's bonding company, Transamerica Premier, is executing the contract for the Contractor. Enclosed in the Agenda packet is an Indemnification and Hold Harmless Agreement signed by Transamerica Premier. This agreement is between the city of Prior Lake and Transamerica Premier Insurance Group hereinafter called Transamerica. The basis of 4629 Dakota St. S.E., Prior Lake. Minnesota 55372 I Ph. (612) 447-4230 I Fax (612) 447-4245 An Equal Opportunity/Affirmative Action Employer ALTERNATIVES: this agreement is for the City to release the final contract amount to Transamerica and in exchange Transamerica agrees to indemnify, defend and hold harmless the City against any losses, damages, liabilities, obligations, claims, actions, suits, proceedings, demands, judgments, assessments, fines, interest, penalties, costs and expenses arising out of the City's issuance of the final check in the amount of $12,330.38. The Indemnification and Agreement has been negotiated Glenn Kessel, City Attorney. Agenda Packet is a letter approving the agreement recommending this matter be Council for their approval. Hold Harmless and agreed to by Enclosed in the from Mr. Kessel to form and taken to the City The contract bid amount for the project was $303,785.65 with the final contract amount to complete the project is $246,607.66. The final project cost was $57,177.99 under the contract bid amount as the actual quantities used in constructing the sanitary sewer, watermain, storm sewer, and street improvements were less than the contract bid amounts. The main reduction of cost was in the granular borrow and rock foundation items which were not needed to correct unsuitable soils to properly construct the improvements as initially estimated. The final payment amount due the contractor is $12,330.38. The invoice for final payment has been included with the invoices of this month for Council approval. The alternatives are as follows: 1. Approve a motion authorizing the Mayor and city Manager to sign the the Indemnification and Hold Harmless Agreement between the City and Transamerica Insurance Group and approving final contract payment for Project No. 87-18, in the amount of $12,330.38 to Transamerica Insurance Group. 2. Disapprove the motion for a specific reason. 3. Table this item for specific reason. RECOMMENDATION: BUDGET IMPACT: ACTION REQUIRED: Alternate number one is recommended as the Contractor has completed the work and the Indemnification and Hold Harmless Agreement has been reviewed and approved by the City Attorney, Glenn Kessel, which protects the Cit~ a~ainst losses, damages, liabilities, ob11gat1ons, claims, actions, suits, proceedings, demands, judgments, assessments fines, interest, penalties, costs and expenses arising out of the City's issuance of the final payment check. Project expenditures have been bonded previously with recovery to be by assessments, ad valorem taxes, and trunk reserve fund. As part of the Consent Agenda, make a motion to authorize final payment to Transamerica Insurance Group in the amount of $12,330.38 for Project No. 87-18. /...... Lommen, Nelson, Cole & Stageberg, P.A. ATTORNEYS AT LAW . T. LEONARD T. JUSTER' HENRY H. FEIKEMA V. OWEN NELSON AI..VIN S. MAI..MON RONALD L. HASKVITZ PHILLIP A. COLE I STEPHEN A. KRUPP MARK N. STAGEBERG I ROGER V. STAGEBERG GLENN R. KESSEL THOMAS R. JACOBSON I RICHARD A. LIND I JOHN M. GIBLIN J. CHRISTOPHER CUNEO THOMAS D. JENSEN I TED E. SU LLIV AN t THOMAS F. DOUGHERTY STACEY A. OeKALB KAY NORD HUNT RICHARD L. PLAGENS PAUl.. C. PETERSON MICHAEL P. SHROYER t THOMAS J. NIEMIEC 336-9338 STEPHEN C. RATHI\!: JOEL W. LAVIST~MS R,\ UI.. A. G,\STEA ZOllO. .111 EHRICH L. KOCH DANI M. SHIMON TODD J. THUN JA~ES R. ANf)REE~ SHERRID. ULLAND MARGIE R. BODAS JAMES M. LOCKHART REID R. LINDQUIST KATHRYN H. DAVIS JAMES C. SEARLS JA~ES R. JOHSSO~ GAR Y D. PONTIUS TERRANCE W. MOORE SUSAN A. YAGER LINDA G. AXEl.ROD CRAIG D. KLAUSIN(i PATRICK R. McDEll."10'JT ADAM LEVITSKY STEVEN A. THEESFEl.D 1800 IDS CENTER 110 SOUTH EIGIITII STREET. MINNF.AI'OLlS, MINNESOTA SS~()2 TELEPHONE (612) 339.8131 ~lIl1n~sola WATS I.In~ 1.80().7S2.~297 FAX (612) 339.806~ AlJIliORIZED TO PRACTICE LAW IN MI;I;NESOTA. IOWA. WISCONSIN and WASHINGTON WJUTER'S DIRECT DIAL NUMBER: February 18, 1991 JOHN P.l.OM~EN (19!J.I')~) WYMAN SMl11i (RETIRED) M,\RK SULLIVAN (RETIRED) Mr. Bruce Loney City of Prior Lake P. O. Box 359 Prior Lake, Minnesota 55372 t ~ilied Civil Tri.1 Spcci,liSl . CenHied Real EIl.3It SPCl'j;llill Dear Bruce: Enclosed please find an Indemnification and Hold Harmless Agreement between the City and Transamerica Insurance Group regarding the Albrecht Excavating, Inc. final contract payments. This Agreement is acceptable to Transamerica. I have reviewed and approved it as to form. Please place this matter on the consent agenda for approval by the City Council. If approved by the City Council, please have Dave sign it as well as Lee Andren and then forward to me the original and two copies of the executed Indemnification and Hold Harmless Agreement together with a check made payable to Transamerica Insurance Group in the amount of $12,330.38 marked "final payment for Project 87-18". I will then obtain an executed copy of the Agreement for your records. Please give me a call should you have any questions. Very truly yours, 'tOPMEN, NE~S~, COLE & STAGEBERG, P.A. ,) Lt."".. I \\. 'vt( \ Glenn R. Kessel GRK:sjf Ene. cc: David Unmacht Larry Anderson INDEMNIFICATION AND HOLD HARMLESS AGREEMENT This Agreement, dated as of the day of , 1991, hy and hetween the City of Prior Lake, a Minnesota municipal corporation (hereinafter the "City") and Transamerica Insurance Group doing business as Transamerica Premier Insurance Company (hereinafter "Transamerica"). RECITALS \VHEREAS, Albrecht Excavating, Inc. ("Contractor") entered into a construction contract with the City for the construction of certain street and utility work in the City, Project No. 87-18 (the "Project") and \VHEREAS, Transamerica issued certain performance and payment bonds to the City and Contractor for the Project as required by the contract documents, and \VHEREAS, the construction Project has been completed and the City represents that there remains $12,330.38 in contract funds currently held by the City as and for final payment for the Project pursuant to the contract, and \VHEREAS, Midway National Bank has requested that all monies due Contractor be made payable to Contractor and Midway National Bank, and \\'HEREAS, Contractor has filed a Chapter 11 bankruptcy proceeding in the Bankruptcy Court in S1. Paul, Minnesota s Bankruptcy Court File No. 3-90-2003, and "'HEREAS, the contract documents provide that the contract furnish the City with a Minnesota Department of Revenue Form IC-134 (a certificate showing that Contractor has complied with the provisions of Minnesota Statues Section 290.92 regarding withholding incoming tax wages at the source), a,nd ~~\~ 7:~. \VHEREAS, Minnesota State Curb-Gutter Division, A VR, Inc., has.~ a l\'otice of Claim for payment regarding the Project, and \\'HEREAS, Transamerica has requested payment of the contract balance in the amollnt of $12,330.38 on behalf of Contractor and itself in exchange for the indemnification and hold harmless agreements contained herein, NOW, THEREFORE, in consideration of the release of the final contract fund balances to Transamerica by the City in exchange for the promises, covenants and agreements contained herein, the parties agree as follows: . . 1. The City shall issue a City check in the amount of $12,330.38 to Transamerica as and for the full and final payments due Contractor under the terms of the Project. 2. Transamerica agrees to indemnify, defend and hold harmless City and its successors and assigns from and against all losses, damages, liabilities, obligations, claims, actions, suits, proceedings, demands, judgments, assessments, fines, interest, penalties, costs and expenses arising out of the City's issuance of its check in the amount of $12,330.38. Transamerica's liability for any and all such losses, damages, liabilities, obligations, claims, actions, suits, proceedings, demands, judgments, assessments, fines, interest, penalties, costs and/or expenses shall be limited to the amount of the City's $12,330.38 payment to Transamerica. In the event a claim is made against the City regarding the City's $12,330.38 payment to Transamerica, the City agrees to give Transamerica prompt notice of any such claim, action, suit, proceeding and/or demand such that Transamerica may conduct the defense of said claims, actions, suits, proceedings and/or demands. Failure to notify Transamerica of :my such claim, action, suit, proceeding, and/or demand within 30 days of the City's notification of said claim, action, suit, proceeding and/or demand shall relieve Transamerica of any liability and/or indemnification obligation to defend and/or indemnify such claim and/or action. IN "1TNESS "'HEREOF, the undersigned have executed this agreement as of the date first above written. CITY OF PRIOR Li\KE By: Mayor Approved as to form: By: City Manager TRANSAMERICA INSURANCE GROep d/b/a TRANSAMERICA PREMIER INS. CO. By~~ *!~~~ dL ~~/~~~ 2