Financial Security Agreements - 504 Francis St - RempFINANCIAL SECURITY AGREEMENT
This Financial Security Agreement ("Agreement") is entered this Z9~day of July 2021
between DJR Investment Properties , LLC , a Kansas limited liability company (the "Applicant")
and the City of Salina, Kansas , a Kansas municipal corporation , (the "City").
Recitals
A. Applicant has applied for the City's issuance of an occupancy permit for a structure
located at 504 Francis St., Building E ("the "Structure") constructed as part of Applicant 's
development project located at 504 Francis St., Salina, Kansas , and legally described as follows:
Francis St. Multi-Purpose Buildings Condominiums Units A-F, according to
the Declaration of Condominium dated February 11, 2020 , recorded in
Book I 367 at Pages 1534-1561 of the Saline County Register of Deeds
office, and located on Lots 8 and 9, East Gardens Addition to the City of
Salina, Saline County , Kansas , a/k/a 504 Francis St., Units A-F (the
"Development Site")
which currently directs stormwater runoff onto adjoining property, necessitating a prompt
resolution prior to issuance of an occupancy permit for the Structure either by (I) construction of
an on-site detention basin with flow from the detention basin to be directed via ditch across
property owned by DJR Investment Properties , LLC ("DJR") and discharged into the City's storm
sewer system located within the North Street right-of-way or (2) construction of a drainage ditch
from the Development Site across property owned by DJR for discharge into the City's storm
sewer system located within the North Street right-of-way.
B. Applicant's interests are to obtain City approval of occupancy of the Structure as
soon as possible while ultimately providing the required code-compliant storm drainage runoff
solution at the least cost by constructing a drainage ditch from the Development Site across
property owned by DJR and Stanion Wholesale Electric Co., Inc. for discharge into the City's
storm sewer system located within the North Street right-of-way (the "Project") for which the
Applicant has provided the City with a conceptual drawing and a cost estimate of $10,000 obtained
by Applicant from Restore Construction, Inc. based upon the conceptual drawing only.
C. The City's interests are:
(I) To accommodate Applicant's interest in occupying the Structure as soon as
possible by allowing for the issuance of a certificate of occupancy for the Structure (the
"CO") in reliance upon Applicant providing assurances of (a) the availability of sufficient
financial resources in advance of issuance of the CO for the topographical survey, design ,
engineering, and construction of the Project and (b) timely completion of the Project in a
code-compliant manner, subject to inspection and approval by the City ;
(2) To assure that the viability of the proposed approach as well as the likely
cost of the Project can be fully determined based upon a topographical survey of the Project
site;
(3) To assure a detailed and engineered final design for the Project has been
prepared by a Kansas licensed civil engineer based upon a topographical survey of the
Project site for review and approval by the City;
(4) To assure the availability of funding for completion of the Project in the
event final design details and/or applicable unit rates reflected in response to a recent
competitively bid city drainage ditch project opened on Thursday, July 22 , 202 l, result in
project costs in excess of the $I 0,000 cost estimate provided by the Applicant; and,
(5) To assure (a) timely completion of the Project by the Applicant; (b) the
City 's ability to complete the Project if the Applicant fails to do so in accordance with this
Agreement; and (c) the City's ability to recover any city funds expended in accordance
with this Agreement to complete the Project.
THE PARTIES agree and covenant:
1. Financial Security . Applicant agrees to submit financial security in the total amount
of $50,000 to be to be held on account by the City ("Funds on Account") and either (a) reimbursed
to the Applicant upon Applicant's successful completion of the project in accordance with this
Agreement or (b) utilized and supplemented by Applicant, if necessary , in the event the City is
required to undertake any of Applicant's obligations under this Agreement upon default by the
Applicant in the timely design and construction of the Project.
2. Issuance of CO. Upon receipt of the financial security provided for in Section l,
the City will issue a CO for the Structure in reliance upon Applicant's commitment to complete
the Project in accordance with the tenns of this Agreement, subject to inspection and approval by
the City.
3. Applicant's Obligations. Applicant agrees to diligently pursue the following tasks
and complete each by the agreed upon deadline:
(a) Selection of a Kansas licensed civil engineer as the design professional and
submission of a service contract for the Project for city review & approval by
08/06/2021.
(b) Submission of an executed design contract by 08/13/2021 that includes, but is not
limited to the following services:
o Topographical survey
o Detailed design per city standards
o Submission of a proposed design engineered by a Kansas licensed civil
engineer for City review and approval
o Revisions in response to City review and approval
(c) Plan completion & submission by 09/10/2021
(d) Execution and recording of deeds for any real estate to be acquired or required
easements consistent with the approved design by l 0/15/202 l
( e) Project bidding by 10/29/2021
(f) Construction contract execution by 11 /05/2021
(g) Construction commencement by 11/19/2021
2
(h) Construction completion by 12 /03 /2021
4. Default. Applicant 's failure to complete any of its obligations within the timelines
set forth in Section 3 shall be an event of default. Upon the occurrence of an event of default the
City shall notify the Applicant, in writing, of such default and the Applicant shall have I 0 days to
cure such default, or a reasonable time designated by the City if the default is of a nature that it
cannot be cured within I 0 days. If the Applicant (a) fails to cure such default within the appointed
time, or (b) fails to cure such default after requesting and receiving a written extension of the
appointed time after taking sufficient steps to warrant an extension , in the reasonable discretion of
the City , then the Applicant agrees that City may use the Funds on Account to pay the cost of (a)
contracting with a Kansas licensed civil engineer or engineering firm to provide project
management services to manage and oversee the remainder of the Project through to completion,
including, but not limited to , project bidding , construction contract bid award, financial
administration and project oversight and closeout; and (b) the cost of constructing the Project.
5. Reimbursement, Supplementation, and Accounting for Funds on Account.
(a) Ifthe Project is completed by the Applicant in accordance with the Agreement, the
City will reimburse the Funds on Account to the Applicant, in full , within ten (10) business days
of the City 's written approval of the completed Project.
(b) If the City is required to complete the Project pursuant to Section 4 and the Funds
on Account are sufficient to complete the Project, the City will account for its use of the Funds on
Account and reimburse the Applicant for any remaining balance of the Funds on Account within
30 calendar days of completion of the Project.
(c) If the City is required to complete the Project and the Funds on Account are
insufficient to enter any to any contract necessary for the City to complete the Project, the City
may account to the Applicant for the use of the Funds on Account and provide written notice to
the Applicant of the requirement that the Applicant supplement the account within ten (10)
business days from the date written notice to the Applicant is delivered by the City to the extent
required to cover the estimated cost of completion of the Project. That process may be repeated
by the City to the extent necessary to complete the Project. If Applicant fails to timely supplement
the Funds on Account in the amount specified by the City , the City may advance payment of the
costs necessary to complete the Project.
(d) To the extent the Applicant 's failure to supplement the Funds on Account results in
the City 's expenditure of its funds to complete the Project, the Applicant agrees to fully reimburse
the City within 30 days of the City providing an accounting and invoice for city funds utilized in
completing the Project. The Applicant further agrees that if the Applicant fails to timely reimburse
the City for city funds utilized in completing the Project, the City shall have the folJowing
cumulative remedies to be exercised, or not , at the discretion of the City until the full amount of
the unreimbursed city funds have been paid in full:
(1) Pursuit and collection of a money judgment against the Applicant in the
Saline County District Court for the unreimbursed city funds and reasonable attorney fees
incurred in obtaining and enforcing the judgment; and/or
3
(2) Certification by the city clerk of such unreimbursed costs paid from city
funds to the Saline County clerk as an assessment for levy and charge against the
Development Site for collection by the county treasurer and payment to the City .
6. Non-assignable. Due to the unique circumstances of the Project and the
relationship of the parties under this Agreement, neither the rights nor the responsibilities provided
for under this Agreement shall be assignable by either party, either in whole or in part.
7. Notices. All notices required or permitted to be given pursuant this Agreement
shall be in writing and delivered personally or by certified mail, return receipt requested, at the
following addresses, or to such other address as either party may designate , in writing, to the other
party:
Applicant: 2504 Berwick Cr.
Salina, KS 67401
City: City-County Building
300 W. Ash St.
Room 202
Salina, KS 67401
8. Compliance with applicable law. The Applicant and the City shall comply with all
applicable federal, state, and local laws in the performance of this Agreement.
9. Time is of the essence. Time is of the essence of this Agreement. No extension of
any of the deadlines set forth in this Agreement will be granted unless in writing and signed by the
parties.
10. Waiver. No failure or delay by a party to insist on the strict performance of any
term of this Agreement, or the exercise any right or remedy consequent to an event of default shall
constitute a waiver of any rights or responsibilities of either party under this Agreement.
11. Amendment. Any amendment of this Agreement must be in writing and signed by
authorized representatives of both parties.
12. No third-oartv beneficiaries. Solely the parties to this Agreement shall have rights
and may make claims under this Agreement. There are no intended third-party beneficiaries under
this Agreement, and no third parties shall have any rights or make any claims under this
Agreement.
13. Binding effect. This Agreement shall be binding upon the parties and their
successors and may be executed in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument. A facsimile of an
original signature, or electronically signed version transmitted to the other party is effective as if the original
was sent to the other party.
14. Force Majeure. In the event that any aspect of the Project is delayed through no
fault of the Applicant, including but not limited to strikes, accidents, weather conditions, and other
4
delays beyond the conlrol of Lhc Applicant , then the various dates set forth in this Agreement shall
be extended by the same number of days that the Projecl is delayed.
EXECUTED by the duly authorized of'ficcrs of' Lhc parties effective the day and year first
stated above.
DJR I 'VESTMENT PROPERTIES, LLC
By: 9o~p~~
Managing Member
CITY OF SALINA , KAN AS
. Schrage
City Manager
.~~rl. ~lt-~.f.J __ ~j;~:filltL..Ql. c \~;~i?t:ro~~lLcJ.~·d i .. ~-:· _i t;,pec~ 1/ers~ on tr(~!1~1rllr£.Yf.!_!~:...J ~JC; _pt.;:;r;;1· .PiiJc ri~•. is ..,.;~.:f~G9!iv~; -fi~Li[J .. h.~~ ...
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14. Force Majeure. In the event that any aspect of the Project is delayed through no
fault of the Applicant, including but not limited to strikes, accidents, weather conditions, and
other delays beyond the control of the Applicant, then the various dates set forth in this
Agreement shall be extended by the same number of days that the Project is delayed.
EXECUTED by the duly authorized officers of the parties effective the day and year first
stated above.
DJR INVESTMENT PROPERTIES, LLC
5
CITY OF SALINA, KANSAS
By: _____________ _
Michael D. Schrage
City Manager
delays beyond the control of' the Applicant then the various dates set forth in this Agreement shall
be extended by the same ti umber of days that the Project is delayed.
EXECUTED by the duly authorized officers of' the parties effective the day and year first
stated above.
DJR INVEST 1!ENT PROPERTIES , LLC
Managing Member
5
CJTY OF ALINA KANSAS
. Schrage
City Manager
FINANCIAL SECURITY AGREEMENT
This Financial Security Agreement ('"Agreement") is entered this ~~ay of July 2021
between DJR Investment Properties, LLC , a Kansas limited liability company (the "Applicant")
and the City of Salina , Kansas , a Kansas municipal corporation , (the "City").
Recitals
A. Applicant has applied for the City's issuance of an occupancy permit for a structure
located at 504 Francis St., Building E ("the "Structure ") constructed as part of Applicant 's
development project located at 504 Francis St., Salina, Kansas , and legally described as follows:
Francis St. Multi-Purpose Buildings Condominiums Units A-F , according to
the Declaration of Condominium dated February 11 , 2020, recorded in
Book 1367 at Pages 1534-1561 of the Saline County Register of Deeds
office, and located on Lots 8 and 9, East Gardens Addition to the City of
Salina , Saline County , Kansas , a/k/a 504 Francis St., Units A-F (the
"Development Site")
which currently directs stormwater runoff onto adjoining property , necessitating a prompt
resolution prior to issuance of an occupancy permit for the Structure either by (I) construction of
an on-site detention basin with flow from the detention basin to be directed via ditch across
property owned by DJR Investment Properties, LLC ("DJR") and discharged into the City's storm
sewer system located within the North Street right-of-way or (2) construction of a drainage ditch
from the Development Site across property owned by DJR for discharge into the City's storm
sewer system located within the North Street right-of-way.
B. Applicant 's interests are to obtain City approval of occupancy of the Structure as
soon as possible while ultimately providing the required code-compliant storm drainage runoff
solution at the least cost by constructing a drainage ditch from the Development Site across
property owned by DJR and Stanion Wholesale Electric Co., Inc. for discharge into the City 's
storm sewer system located within the North Street right-of-way (the "Project") for which the
Applicant has provided the City with a conceptual drawing and a cost estimate of $10,000 obtained
by Applicant from Restore Construction , Inc. based upon the conceptual drawing only.
C. The City 's interests are:
(I) To accommodate Applicant 's interest in occupying the Structure as soon as
possible by allowing for the issuance of a certificate of occupancy for the Structure (the
"CO") in reliance upon Applicant providing assurances of (a) the availability of sufficient
financial resources in advance of issuance of the CO for the topographical survey , design,
engineering, and construction of the Project and (b) timely completion of the Project in a
code-compliant manner, subject to inspection and approval by the City;
(2) To assure that the viability of the proposed approach as well as the likely
cost of the Project can be fully determined based upon a topographical survey of the Project
site ;
(3) To assure a detailed and engineered final design for the Project has been
prepared by a Kansas licensed civil engineer based upon a topographical survey of the
Project site for review and approval by the City;
(4) To assure the availability of funding for completion of the Project in the
event final design details and/or applicable unit rates reflected in response to a recent
competitively bid city drainage ditch project opened on Thursday, July 22, 2021, result in
project costs in excess of the $10,000 cost estimate provided by the Applicant; and,
(5) To assure (a) timely completion of the Project by the Applicant; (b) the
City's ability to complete the Project if the Applicant fails to do so in accordance with this
Agreement; and (c) the City 's ability to recover any city funds expended in accordance
with this Agreement to complete the Project.
THE PAR TIES agree and covenant:
1. Financial Security. Applicant agrees to submit financial security in the total amount
of$50,000 to be to be held on account by the City ("Funds on Account") and either (a) reimbursed
to the Applicant upon Applicant's successful completion of the project in accordance with this
Agreement or (b) utilized and supplemented by Applicant, if necessary, in the event the City is
required to undertake any of Applicant's obligations under this Agreement upon default by the
Applicant in the timely design and construction of the Project.
2. Issuance of CO . Upon receipt of the financial security provided for in Section 1,
the City will issue a CO for the Structure in reliance upon Applicant's commitment to complete
the Project in accordance with the terms of this Agreement, subject to inspection and approval by
the City.
3. Applicant's Obligations. Applicant agrees to diligently pursue the following tasks
and complete each by the agreed upon deadline:
(a) Selection of a Kansas licensed civil engineer as the design professional and
submission of a service contract for the Project for city review & approval by
08/06/2021.
(b) Submission of an executed design contract by 08/13/2021 that includes, but is not
limited to the following services:
o Topographical survey
o Detailed design per city standards
o Submission of a proposed design engineered by a Kansas licensed civil
engineer for City review and approval
o Revisions in response to City review and approval
(c) Plan completion & submission by 09/10/2021
( d) Execution and recording of deeds for any real estate to be acquired or required
easements consistent with the approved design by l 0/15/2021
( e) Project bidding by 10/29/2021
(f) Construction contract execution by 11/05/2021
(g) Construction commencement by l l /19/2021
2
(h) Construction completion by 12103/2021
4. Default. Applicant's failure to complete any of its obligations within the timelines
set forth in Section 3 shall be an event of default. Upon the occurrence of an event of default the
City shall notify the Applicant, in writing, of such default and the Applicant shall have l O days to
cure such default, or a reasonable time designated by the City if the default is of a nature that it
cannot be cured within lO days. If the Applicant (a) fails to cure such default within the appointed
time, or (b) fails to cure such default after requesting and receiving a written extension of the
appointed time after taking sufficient steps to warrant an extension, in the reasonable discretion of
the City, then the Applicant agrees that City may use the Funds on Account to pay the cost of (a)
contracting with a Kansas licensed civil engineer or engineering firm to provide project
management services to manage and oversee the remainder of the Project through to completion,
including, but not limited to, project bidding, construction contract bid award, financial
administration and project oversight and closeout; and (b) the cost of constructing the Project.
5. Reimbursement, Supplementation, and Accounting for Funds on Account.
(a) If the Project is completed by the Applicant in accordance with the Agreement, the
City will reimburse the Funds on Account to the Applicant, in full, within ten (10) business days
of the City's written approval of the completed Project.
(b) If the City is required to complete the Project pursuant to Section 4 and the Funds
on Account are sufficient to complete the Project, the City will account for its use of the Funds on
Account and reimburse the Applicant for any remaining balance of the Funds on Account within
30 calendar days of completion of the Project.
(c) If the City is required to complete the Project and the Funds on Account are
insufficient to enter any to any contract necessary for the City to complete the Project, the City
may account to the Applicant for the use of the Funds on Account and provide written notice to
the Applicant of the requirement that the Applicant supplement the account within ten (10}
business days from the date written notice to the Applicant is delivered by the City to the extent
required to cover the estimated cost of completion of the Project. That process may be repeated
by the City to the extent necessary to complete the Project. If Applicant fails to timely supplement
the Funds on Account in the amount specified by the City, the City may advance payment of the
costs necessary to complete the Project.
(d) To the extent the Applicant's failure to supplement the Funds on Account results in
the City's expenditure of its funds to complete the Project, the Applicant agrees to fully reimburse
the City within 30 days of the City providing an accounting and invoice for city funds utilized in
completing the Project. The Applicant further agrees that if the Applicant fails to timely reimburse
the City for city funds utilized in completing the Project, the City shall have the following
cumulative remedies to be exercised, or not, at the discretion of the City until the full amount of
the unreimbursed city funds have been paid in full:
(l) Pursuit and collection of a money judgment against the Applicant in the
Saline County District Court for the unreimbursed city funds and reasonable attorney fees
incurred in obtaining and enforcing the judgment; and/or
3
(2) Certification by the city clerk of such unreimbursed costs paid from city
funds to the Saline County clerk as an assessment for levy and charge against the
Development Site for collection by the county treasurer and payment to the City.
6. Non-assignable. Due to the unique circumstances of the Project and the
relationship of the parties under this Agreement, neither the rights nor the responsibilities provided
for under this Agreement shall be assignable by either party, either in whole or in part.
7. Notices. All notices required or permitted to be given pursuant this Agreement
shall be in writing and delivered personally or by certified mail, return receipt requested, at the
following addresses, or to such other address as either party may designate, in writing, to the other
party:
Applicant: 2504 Berwick Cr.
Salina, KS 67401
City: City-County Building
300 W. Ash St.
Room 202
Salina, KS 67401
8. Compliance with applicable law. The Applicant and the City shall comply with all
applicable federal, state, and local laws in the performance of this Agreement.
9. Time is of the essence. Time is of the essence of this Agreement. No extension of
any of the deadlines set forth in this Agreement will be granted unless in writing and signed by the
parties.
10. Waiver. No failure or delay by a party to insist on the strict performance of any
term of this Agreement, or the exercise any right or remedy consequent to an event of default shall
constitute a waiver of any rights or responsibilities of either party under this Agreement.
11. Amendment. Any amendment of this Agreement must be in writing and signed by
authorized representatives of both parties.
12 . No third-partv beneficiaries. Solely the parties to this Agreement shall have rights
and may make claims under this Agreement. There are no intended third-party beneficiaries under
this Agreement, and no third parties shall have any rights or make any claims under this
Agreement.
13. Binding effect. This Agreement shall be binding upon the parties and their
successors and may be executed in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument. A facsimile of an
original signature, or electronically signed version transmitted to the other party is effective as if the original
was sent to the other party.
14. Force Majeure. In the event that any aspect of the Project is delayed through no
fault of the Applicant, including but not limited to strikes, accidents, weather conditions, and other
4
delays beyond the control or the Applicant. then the variou s dates set fonb in this Agreement shall
be extended by the same number of days that the Pr~jeet is delayed .
EXECUTED by the duly authorized olliccrs or the parties effective the day ;md year first
stated above.
DJR I ·vEST\.l~T PROPERTIF.S , LLC CITY OF SALINA. KANSAS
By: Q~~ Dougl~p
Managing rvtcmbcr
5
'Y KAW VALLEY ENGINEERING, INC. ---
July 29, 2021
E20D2487
Doug Rempp
14908 E. Crown Ct.
Fountain Hills, AZ 85268
RE: 504 Francis St. Drainage Improvements -Salina, Kansas
Dear Mr. Rempp:
Office: 785 .823 .3400
Fax : 785 .823 .3411
Web : www.kveng .com
Address: 742 Duvall Avenue
Salina, KS 67401
In response to your request, Kaw Valley Engineering, Inc. (KVE) is pleased to submit the following proposal
for DESIGN SERVICES for the above referenced project
Basic Scope of Services. Civil Desi gn for grading_illld drainage. The following services will include:
• Grading a ditch centered on the south property line of Mark Augustine's property.
• Filling of the existing ditch along the south edge of Mark Augustine's building.
• Grading a ditch to the south within the proposed drainage easement to act as an overflow ditch
durtng large rain events .
• Topographic Survey needed to accurately design proposed grading and confirm building floor
elevations.
• Submission of PE sealed grading plan for City review.
• Addressing minor comments from City review.
The estimated fee for providing the above scope of services will be Five Thousand Dollars ($5,000.00).
Invoices shall be submitted by KVE on a monthly basis, are due upon pre~entation, and shall be considered
past due if not paid within thirty (30) calendar days of the invoice date. If payment in full is not received by
KVE within thirty (30) calendar days of the invoice date, invoices shall be subject to a late charge of one-
and-one-half (1.5) percent of the past due amount per month, which shall be calculated from the invoice date .
Additional Services. In addition to the above services, Client may desire additional services as project
requirements develop.· Additional Seivices are not included as part of the Basic Scope of Services and shall
be paid for by the Client in addition to payment for Basic Services. If authorized by the Client, KVE shall
provide Additional Services which may include, but are not limited to the following:
1. Construction Staking
2. Material Testing
3. Inspection
4. Construction Adminsttation
Office Locations: Junction City, KS/ Kansas City, MO/ Lenexa, KS I Salina, KS/ Emporia, KS I Wichita, KS
If the above fees are acceptable, please return an executed copy of this letter to our office. If you have any
questions or require additional information, please do not hesitate to contact me at (785) 823-3400.
Respectfully submitted,
Kaw Valley Engineering, Inc.
Justin Owens, P .E.
Office Director
AUTHORIZATION AND NOTICE TO PROCEED
Client: Doug Rempp
Nameflltle: On.ff 01~ / l114n J, .. , "'"""t.I'
(please prim) ~ OJR r lf'I vi-.
signature: z W', ~ F!f7? f1' .. r
Date: ~~
Project Reference No.:
E20D2487
E-mail for Accounting:
ct r :::ft .1. •§:4' r/, c.o..,.,_
E-mail addre-ss -whereill(; ;es can be~ teiectronically