I support councilors Stewarts ordinance.

Last nights city council meeting had a lot of hot topics. I will get into those shortly but the first one I want to talk about is the ordinance by councilor Stewart.

I have to say that I am impressed with this. Yes it makes it harder for devolpers in some sence however at with the times that Duluth is facing we need to start getting harder on everything that we do with our money. This does not make it tarrible for and developer at all.

Below is the full

The city of Duluth does ordain:
Section 1. That the Duluth City Code, 1959, as amended, be amended by adding a new Article XXXIV to read as follows:
Article XXXIV. Regulation of Development Agreements and Business Subsidies.
Sec. 2-179. Policy.
It is the policy of the city of Duluth to engage in appropriate business development and physical development activities, but only in compliance with law, this ordinance, and reasonable standards for the honest disclosure of costs and revenue sources to the public. The city should not agree to pay for activities or structures unless the maximum cost thereof is set out in the agreement.
Sec. 2-180. Definitions.
(a) Development agreement means any promise between the city, DEDA, a city department, city agent or city official acting in his or her official capacity and at least one other party which agreement at least one of the parties intends to be legally enforceable, and which agreement has, as one of its purposes, the encouragement, assisting, subsidization, financial support or development of commercial, investment, land development, employment or business activity within the city of Duluth. It includes an agreement with a not for profit corporation, a government agency, or any other party. It includes an agreement by which any other party will, for the purpose of making a profit, use or manage real estate owned in whole or part by the city. It includes an agreement whereby the city agrees to alter or build public facilities, streets, sewers, or other improvements as a part of an economic development project, including a tourist attraction. It includes an agreement for a business subsidy. It includes a change to, amendment of, or a part of, a development agreement;
(b) Physical development means construction or alteration of real estate, including buildings, structures and infrastructure, whether or not for public use;
(c) Public activity summary means a document, on a form approved by the finance director, which contains the following information about the development agreement:
(1) A brief statement that describes the project;
(2) The public purpose of the agreement;
(3) Identity of each party to the agreement;
(4) The total cost of completing the project, including interest, professional fees, financial fees, bonding costs, the value of donated land or property;
(5) The greatest possible total cost (expenditure by) to the city, including the value of land or property donated by the city, under the proposed development agreement;
(6) Any contingent costs, such as environmental response or regulatory penalties, that could not be estimated for inclusion in (4) or (5) above;
(7) The estimated actual total cost (expenditure by) to the city or DEDA under the proposed agreement, including business subsidies, pass through money, grants, loans, tax increment financing, value of land or property donated to the project, etc.;
(8) The estimated total net cost to (expenditure by) the city at the time of completion of construction of the project (7) above less money or property received by the city under the agreement);
(9) The amount and source, by fund if applicable, of each revenue to the city that will be used to pay each expenditure that makes up the total cost (expenditure by) shown in (7) above;
(10) The certification by the city finance director or city auditor that each amount and source identified in (9) above is available for use at the time needed under the proposed contract, and has been secured and encumbered for the proposed use or, if not, or if the money is to be received as reimbursement for costs actually, an explanation of the extent to which the city can be sure that it will receive the money;
(11) Tax base impact information required for a proposal under Article XXXI of this Chapter, or its successor and a statement of amount of annual ad valorem tax that will not be available for general use, which otherwise would be, as a result of tax increment financing of the project under the agreement;
(12) The party responsible for paying any costs of the project which are not paid by the city or DEDA;
(13) The certificate of the director of planning that the proposed agreement is for the entire project and that costs in excess of those reported are not expected or foreseeable.
Sec. 2-181. Public activity summary required.
Whenever a development agreement that has an estimated actual total cost (as defined in Section 2-180(c)(7)) in excess of $55,000 is presented for review or approval to any government agency, elected official, city board or commission or city council, it shall have attached to it a public activity summary. The public activity summary shall also be filed with the clerk as a public document. The city council shall not vote on any development agreement, or part or amendment of one, unless the public activity summary has been on file with the clerk as a public document for at least five days before the date of the vote.
Sec. 2-182. Requirements for a development agreement.
Any development agreement entered into by the city shall:
(a) Contain a clear statement of the maximum total expenditures (cost to), including all costs, fees, business subsidies, pass through money, grants, tax increment financing, value of land or property donated to the project, etc., by the city or DEDA under the agreement;
(b) Identify each funding source for the city or DEDA’s expenditures under the agreement;
(c) Not obligate the city or DEDA to do an act or construct a structure the total cost of which is not included in the total expenditure described in (a) above;
(d) Shall not obligate the city or DEDA to furnish a service, structure, value or thing to another party to the contract which is not limited by an enforceable and stated cost maximum as set out under Section 2-182(a), above.
Sec. 2-183. Remedies.
If any development agreement is entered into in violation of this article, or does not conform to the requirements of this article, then it is voidable. Such a contract can be cancelled and rescinded by written notice to the other parties from the mayor, or by written notice approved by the council by resolution, or by ruling of a court of competent jurisdiction. If an agreement is cancelled and rescinded, the city or DEDA will be responsible for performance of the agreement up to the date of cancellation, but may seek contribution or set off from any liable party. An intentional violation of this article is punishable as set out in D.C.C. Section 1-7, or its successor, together with any civil liability or criminal liability under any applicable law.
Section 2. That this ordinance shall take effect 30 days after its passage and publication.
STATEMENT OF PURPOSE: This ordinance regulates the use of development agreements. It creates two basic requirements:

1. Every development project must have a known maximum amount the city can be forced to pay.

2. Every development project must have a known cost to the city and a known source for funds to pay that cost before the council votes on the matter.