98-089
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CITY OF SHOREWOOD
RESOLUTION NO. 98- 089
A RESOLUTION AUTHORIZING EXECUTION OF AN AGREEMENT FOR
USE OF THE PUBLIC RIGHT OF WAY BY KMC TELECOM TI, INC.
WHEREAS, KMC Telecom II, Inc. (KMC) is a private utility company located in
the State of Delaware and is licensed to do business within the State of Minnesota, for
providing telecommunications services; and
WHEREAS, KMC has requested from the City Council of the City of Shorewood
use of the public right of ways for the installation of fiber optic facilities; and
WHEREAS, Other utility companies have located their utilities within the public
right of ways under the jurisdiction of the City of Shorewood;
NOW, THEREFORE BE IT RESOLVED by the City Council of the City of
Shorewood, Minnesota:
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That the Mayor and City Administrator are authorized to enter into an
agreement with KMC Telecom II, Inc. for installation and maintenance by
KMC of fiber optic facilities within public right of way, contingent upon
the City Attorney approving the final form of agreement attached hereto as
"Exhibit A."
ADOPTED BY THE CITY COUNCIL OF THE OTY OF SHOREWOOD
this 28th day of September, 1998.
ATTEST:
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J
S C. HuRM, CITY ADMINISTRATOR
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ENCROAC~lliNTAGREENffiNT
THIS AGREENllil'li is made as of the day of , 1998, by and
between the City of Shorewood, a Minnesota municipal corporation ("City") and KJ.vIC
Telecom II, Inc. a corporation authorized to do business within the State of Minnesota, and
having its principal office at 1545 Rt. #206, Suite #300, Bedminster, New Jersey 07921-2567
("KMC").
RECITALS
WHEREAS, KMC is a corporation duly organized, and existing under the laws of the
S tate of Delaware and is requesting approval to use the City public rights-of-way to provide
telecommunications services ("Telecommunications Services");
WHEREAS, KMC has voluntarily chosen to enter into this Encroachment Agreement
with the City and comply with the provisions contained herein with full knowledge of Laws of
Minnesota 1997, Chapter 123; and
WHEREAS, the City has authority to grant encroachment to its rights-of-way only as
expressly specified in applicable law, however, the City makes no representation, guaranty, or
warranty with respect to its title or interest in said rights-of-way.
NOW, THEREFORE, 1L,,{ CONSIDERATION OF THE REOTALS AND THE MUTUAL
CONSIDERATION CONTAINED HEREL.,,{, THE CITY Ai'ID KlVIC AGREE AS
FOLLOWS:
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DEFINITIONS
City means the City of Shorewood, located within the County of Hennepin, Minnesota.
Devices means Fiber Optic Network Facility or Facilities, fiber optic cables, conduits, converters,
splice boxes, cabinets, handholes, manholes, vaults, equipment, drains, surface location markers,
appurtenances and related facilities located by KMC or to be located by K1\11C in the Public
Rights-of- Way of the City and used or useful for the transmission of Telecommunications
Services. Devices shall not include any buildings or poles.
Law means any local, state, or federal statute, ordinance, rule, regulation, code, license, certificate,
franchise, permit, writ, ruling, award, executive order, directive, requirement, injunction,
judgment, decree, or other order issued, executed, entered, or deemed applicable by any
governmental authority.
Public Right-of-Way means the area on, below, or above a public roadway, highway, street,
cartway, bicycle lane, and public sidewalk in which the City has interest, including other
dedicated rights-of-way for travel purposes of the City. A public right-of-way does not include
the airwaves above a public rights-of-way with regard to cellular or other non-wire
telecommunications or broadcast service, nor does it include land owned by the City for other
public purposes, or utility easements.
CONSTRUCTION,NUUNTENAi~CE
Al'ID OPERATION OF THE SYSTElVI
1. LICENSE Al'ID ENCROACHlVlliNT AUTHORIZATION. Subject to the provisions
of this Agreement and all applicable Law, the City hereby authorizes the non-excIusive
encroachment by Ki'v1C to construct, install, maintain, locate, move, operate, place, protect,
reconstruct, reinstall, relocate, remove, and replace the Devices over and along the Public
Rights-of-Way for the purpose of providing Telecommunications Services. Said encroachment
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authorization is not assignable without the express writ permission of the City, which
permission shall not be unreasonably withheld.
This Agreement shall not be sold, transferred, leased, assigned, or disposed of, including but not
limited to, by force or voluntary sale, merger, voluntary or involuntary bankruptcy,
consolidation, receivership, or other means without the prior written consent of the City, which
consent shall not be unreasonably withheld. Notwithstanding any other provision in this
Agreement, no consent from the City shall be required for a transfer in trust, mortgage, collateral
assignment, or other instrument of hypothecation, in whole or in part, to secure an indebtedness
or for a pro forma transfer to a corporation, partnership, or other entity controlling, controlled
by, or under common control with KMC.
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2. TERIVl. The term of said encroachment authorization shall be for an initial period of five
(5) years commencing on the date of the signing of this Agreement. The parties agree that the
encroachment authority shall automatically renew for additional five (5) year periods, unless
either party gives a minimum of ninety (90) days advance written notice to the other of intent to
terminate prior to the end of said five (5) year period.
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NO INTERFERENCE. Except as permitted by applicable Law and this Agreement, in the
performance and exercise of its rights and obligations under this Agreement, Kl'vlC shall not
interfere in any manner with the existence and operation of any and all private and Public Right-
of Ways, sanitary sewers, watermains, storm drains, gas mains, poles, overhead and underground
electric and telephone wires, electoIlers, cable television wires, and other telecommunications,
utility, municipal and other public property without the approval of the owner(s) of the affected
property or properties. Except where engineering or telecommunication factors dictate otherwise,
Ki'v1C shall co-locate its facilities and Devices with other users of the Public Rights-of-Way. The
City may condition approval of any permit upon the production of studies or other evidence
which indicates to the City's satisfaction that all reasonable efforts have been made to co-locare
facilities or Devices.
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4. NO PROPERTY INTEREST. This Agreement is not a grant by the City of any fee
simple property interest and is made subject and subordinate to the prior and continuing right of
the City to use the Public Right-of-Ways as a street and any other public use and for the purpose
of laying, installing, maintaining, repainting, protecting, replacing, and removing sanitary sewers,
watermains, storm drains, gas mains, poles, and for other municipal uses and with right of ingress
and egress, along, over, across, and in said Public Rights- of-Way.
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5. APPLICATION FOR PE&.\UTS. KJ.YfC shall apply to the City Engineer for a permit
for all work and each job within the Public Rights-of-Way. KivlC shall furnish detailed plans of
the work and other such information as required by the City and by Law, and shall pay all
review, processing, field marking, engineering, inspection, security, and any other fees prior to
issuance of required permits in accordance with the rates in effect at the time of payment subject
to Section 15 hereof. KivlC shall also indicate in its application the existence and location of other
facilities in the Public Rights-of-Way, and the extent of its efforts to co-locate its Devices on or
with existing users of the Public Rights-of-Way. Permit applications shall be submitted as
scaled drawings indicating the location of public streets, sidewalks, and facilities that are to be
disrupted, impacted or adjacent to the installation. Permit applications shall also include an
adequate description as to the means and methods of the installation. IfKi\llC proposes to co-
locate its Devices on or with existing uses of the Public Rights-of-Way, KivlC shall in its
application provide sufficient information to establish that it has the permission of the existing
users to use or co-locate its facilities and Devices.
6. ISSUAL~CE OF PERlVllTS. Upon execution of this Agreement and performance of the
obligations contained in the Agreement by KiYfC, the City will issue all permits necessary to the
installation ofKiYfC's Devices, in accordance with the City's permitting procedures as may from
time-to-time be amended in accordance with applicable law.
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7. MAL~"NER OF CONSTRUCTION. The construction, installation, operation,
maintenance, and removal of said Devices shall be accomplished without cost or expense to the
City and in such a manner so as not to endanger persons or property, or unreasonab[y obstruct
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travel on any road, walk. or other access thereon within the Public Rights-of-Way. I(;,,,tc shall
complete installation of its Devices in a reasonably timely manner. KMC shall use re3SQnable
efforts to avoid disturbing public streets, roads, or sidewalks that have been constructed by the
City within five (5) years of application by K.,'vlC for Public Rights-of-Way permits. K.,'lilC shall
also use reasonable efforts to coordinate its construction schedule with the City's schedule of
public improvements.
The installation of any underground facilities under paved or concrete surfaces shall be
completed by directional boring methods of construction, or other means approved by the City
Engineer. Open trenching of paved surfaces or installation of facilities under any paved surface
or concrete surface by pneumatic devices shall not be permitted.
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8. ~lAPS. Within Sixty (60) days of completion of construction, KMC shall provide the
City with an accurate map drawn to scale or maps certifying the location of all Devices within
the Public Right of Ways as built in a format consistent with the City's electronic mapping
system.
9. CO~l>ITION OF FACILITIES. KMC agrees to beep said Devices in good and safe
condition and free from any nuisance.
10. REQUIRED AUTHORIZATION. Ki'-ifC shan provide the City with sufficient
information to establish that it has obtained all required government approvals and permits to
construct and operate the Devices and to offer and provide Telecommunications Services
including any certification or other documentation required by the Public Utilities Commission of
the State 0 f Minnesota or any other regulatory entity.
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LOCATION OF FACILITIES AJ,'fD EQl.JIPtvIENT. The Engineer may assign specific
corridors wi thin the right of way, or particular segment thereof as may be necessary, for each
. type of equipment that is or, pursuant to current teclmology, the Engineer expects will someday
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be located within the right of way. All pennits issued by the Engineer involving the installation
or replacement of equipment shall designate the proper corridor for the equipment at issue.
To protect health and safety, the Engineer shall have the power to prohibit or limit the
placement of new or additional equipment within the right of way of there is insufficient space to
accommodate all of the requests ofregistrams or persons to occupy the use of the right of way.
In making such decisions, the Engineer shall strive, to the extent possible, to accommodate all
existing and potential users of the right of way, but shall be guided by considerations of the
public interest, the public's need for a particular utility service, the condition of the right of
way, the protection of existing equipment in the right of way, and future plans for public
improvements which have been detennined to be in the publics interest.
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11. RELOCATION FOR CITY PURPOSES. KlvlC shall relocate, in cooperation with, and
at no charge to the City, any Devices installed, used, and maintained under this Agreement if and
when made necessary by any change of grade, alignment, or width of any Public Right-of- Ways,
the construction, maintenance, or operation of any underground subway, viaduct, watermain,
sanitary sewer by the City and/or the construction, maintenance, or operation of any other City
underground or above-ground facilities.
12. REMOVAL A1.'ID ABA1.'IDONMENT. If any of the Devices covered under this
Agreement are no longer used by KivfC, or are abandoned for a period in excess of twelve; (12)
months, KJ.\tIC shall notify the City and the City shall detennine whether KlV!C shall either
promptly vacate and remove the Devices at KlV!C's expense or abandon some or all of the
Devices in place to the extent permitted by Law.
13. RESTORATION Of PUBLIC RlGHTS-Of-WAY. When removal or relocation of the
Devices are required under this Agreement, K.1V!C shall, after the removal or relocation of the
Devices, at its own cost, repair and return the Public Rights-of-Way on which the Devices were
located to the same or better condition exuding before such removal or relocation. The work must
. be completed as promptly as the weather permits. If KLyIC does not properly perform and
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complete the work, remove all dirt, rubbish, equipment and material, and restore the Public
Rights-of-Way to the same or better condition, the City may restore the Public Rights-ot:Way to
the sane condition at the expense of K\1C. KMC must, upon demand, pay to the City the direct
and indirect cost of the work done for or performed by the City, including but not limited to the
City's administrative costs.
14. DAMAGE. Klv!C shall be responsible for damages to City street pavements, existing
utilities, curbs, gutters, and sidewalks due to KMC's installation, maintenance, repair, or removal
of its Devices in Public Rights-of-Ways, and shall repair, replace, and restore the damaged Public
Rights-of-Way at its sole expense and subject to approval by the City, which approval shall not
be unreasonably withheld.
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15. SECURITY. For companies not operating under a franchise with the City, a surety
bond, letter of credit or cash deposit on the amount determined by the City Engineer but not less
than five thousand dollars ($3,000) shall be required from each applicant. The Security shall
remain with the City until such time as the work has been inspected and approved by the City.
At such time, the City Engineer will provide the applicant and financial institution with a letter
releasing the Security.
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16. OTHER CITY REQUIREMENTS. KJ.\tlC shall pay all permit fees or any other fees to
the City in accordance with applicable law. Such fees shall not exceed the City's management
costs as defmed in laws of Minnesota 1997, Chapter 123, Section 3, Subdivision 9. K:.\t!C
expressly acknowledges and agrees that the City shall have the tight to impose upon Kl\t!C
additional fees and/or damages for Ki\t1C's occupation of the Public Right-of-Way to the extent
not inconsistent with applicable law. It is anticipated that, sometime after the execution of this
Agreement, the City will adopt an ordinance imposing comprehensive requirements on
telecommunication rights-of-way users pursuant to recently enacted state legislation (Laws of
Minnesota 1997, Chapter 123). KMC further acknowledges and agrees to be bound by any
subsequent ordinance or regulation adopted by the City with respect to the City's lawful control
outer its Public Rights-of-Way and hereby agrees and acknowledges that such ordinance or
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regulation. including any permit and fee requirements, will be retroactively applied, provided that
such ordinance or regulation is also retroactively applied to all Telecommunications Service
providers who are granted permits from the City to install new Devices on Public Rights-of-Way
after the effective date of this Agreement. Any permit or other fees paid by K.v{C prior to the
adoption of a subsequent ordinance shall be credited against those fees require by a subsequent
ordinance. If there are any inconsistencies between the terms of this Agreement and those of any
subsequent ordinance or regulation, the terms of any subsequent ordinance or regulation shall take
precedence.
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K1\tlC voluntarily agrees to reimburse the City in an amount not to exceed $500 for the Cities
out-of-pocket legal and other consultant costs and expenses incurred to process KiV1C'request.
The City shall provide K.i\1C with copies of all invoices relating to said costs and expenses and
K1\t1C shall only provide reimbursement for costs and expenses actually incurred by the City.
Any amount paid by K.:.YfC to reimburse the City hereunder shall not be credited against other
amounts payable to the City by KMC hereunder.
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17. NONDISCRliVlINATORY FEES. With respect to the City's imposition of any fees or
charges not specifically required in this Agreement, K.:.YfC shall only be required to pay any fee
or charge to the extent permitted by law and which is imposed in a competitively neutral and
nondiscriminatory manner with respect to other similarly situated Telecommunications Service
providers.
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18. INDEMNIFICATION. K.iYfC, By acceptance of this Agreement, or by acceptance of a
permit, K.iYfC is required to defend, indemnify, and hold the City whole and harmless from all
costs, liabilities, and claims for damages of any kind arising out of the construction, presence,
installation, maintenance, repair or operation of it's equipment, or out of any activity undertaken
in or near a right of way, whether or not any act or omission complained of is authorized,
allowed, or prohibited by a right of way permit. KvlC further agrees that it will not bring, not
cause to be brought, any action, suit or other proceeding claiming damages, or seeking any other
relief against the City for any claim nor for any award arising out of the presence, installation,
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maintenance or operation of it's equipment. or any activity undertaken in or near a right of way,
whether or not the act or omission complained of is authorized, allowed, prohibited by a right of
way pennit.
19. INSURAL'fCE. K.LYIC and/or any of its subcontractors or agents under the Agreement
shall maintain throughout the term of this Agreement, worker's compensation insurance and
liability insurance with regard to all damages in the maximum amounts of:
A. General Liability - public liability, including premises, products and complete operations.
(1) Bodily injury liability $1.000,000 each person
$2,000,000 general aggregate
(2) Property damage liability $1,000,000 each occurrence
or
. (3) Bodily injury and by $2,000,000 general aggregate
: damage combined
B. Comprehensive - Automobile Liability Insurance, including owned, non-owned, and hired
vehicles.
(1)
Bodily injury liability
$1,000,000 each person
$1,000,000 each occurrence
$1,000,000 each occurrence
$1,000,000
Property damage liability
In lieu of (1) and (2),
Bodily injury and property
single limit damage combined
Backed up by umbrella coverage in excess of$3,000,OOO.
(2)
(3)
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C. !G.v{C agrees that with respect to the above required insurances, contracts will contain the
following required provisions:
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( 1) The City and its officers, agents, employees, board members and elected officials shall be
named as additional insured (as the interests of each may appear) as to all applicable coverage;
and
(2) Contracts shall provide for third (30) days notice to the City prior to cancellation,
revocation, non-renewal, or material change.
D. The amount and conditions of liability and comprehensive insurance may be increased
upon sixty (60) days' written notice by the City should the protection afforded by this insUrance
be reasonably deemed by the City to be Insufficient for the risk created by this Agreement. At no
time, however, will the amount of required liability and comprehensive insurance exceed that
which is customarily required of others for similar situations of risk.
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E. KJ.\lfC shall furnish a certificate of insurance to the City confirming the above-noted
coverage and naming the City as an additional insured.
20. DEFAULT. IfKMC is in default of any obligations contained in this Agreement or in the
performance of the work or occupancy authorized by this Agreement or any permit granted
pursuant to this Agreement, including but not limited to restoration requirements or fee
payments, for more than thirty (30) days after receiving written notice from the City of the
default, the City may the rights ofKi\lfC under this Agreement and any permit granted
hereunder, subject to the City's absolute right to revoke at any time in the exercise of the City's
police powers. The notice of default must be in writing and specify the provisions of this
Agreement or any permit under which the default is claimed and state the grounds of the claim.
Any notice must be served on KivlC by certified mail, return receipt requested, at its principal
place of business.
IfKJ.v[C is in default in the performance of the work or occupancy authorized by this Agreement
. or any permit granted hereunder, the City may, after the above notice to KMC and failure of
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KJ.'vfC to cure the default, take such action as may be reasonably necessary to abate the condition
caused by the default. KJ.'vfC must reimburse the City for the City's reasonable costs, including
costs of collection and attorney's fees, incurred as a result ofKJ.\1C's default.
21. EMERGENCY 'WORK. In the event of any emergency in which any ofK..vlC's Devices
located in, above, or under any rights-of-way are damaged, or ifKJ.\1C's installation area is
otherwise in such a condition as to immediately endanger the property, life, health, or safety of
any individual, K.MC shall immediately take the proper emergency measures to repair its
Devices, to cure or remedy the dangerous conditions for the protection of property, life, health,
or safety of individuals, without first applying for and obtaining a permit as required by this
Agreement or a subsequent ordinance. However, this shall not relieve KJ.\1C from the requirement
of notifying the City of the emergency work and obtaining any permits necessary for this
purpose upon completion of the repairs.
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22. LA W. The terms and conditions of this Agreement shall be subject to any and all
applicable Law and shall be governed by the laws of Minnesota. Should any term of this
Agreement be determined by a court or other entity with competent jurisdiction to be
unenforceable, aU other terms of this Agreement shall remain in full force and effect.
lL'l' WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first
above written.
Dated: (~p~'lbLy d2( ,1998.
CITY OF SHOREWOOD
(SEAL)
"JA;V\
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Dated:
,1998.
KivIC TELECOM II, INC.
BY:
Michael Steinberg, PresidenrJCEO
STATE OF MINNESOTA )
) ss
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this~day of~J.tt)ln-b-V;-1998, by
Tom Dahlberg and James C. Hurm, respectively the Mayor and City AdmiD:istrator of the City
of Shorewood, a Minnesota municipal corporation, on behalf of the corporation and pursuant to
the authority granted by its City Council.
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NOTARY PUBLIC
STATE OF MINNESOTA )
) 55
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this day of , 1998, by
Michael Steinberg the President/CEO ofKJ.vlC Telecom II, Inc. a corporation duly organized, and
authorized to do business in the State of Minnesota, on behalf of the corporation.
NOTARY PUBLIC