MONTROSE URBAN RENEWAL AUTHORITY BOARD of COMMISSIONERS MEETING

THURSDAY, MAY 11, 2017, 5:00 p.m. City Council Chambers, 107 S. Cascade Avenue

AGENDA 1. Welcome & Introductions

- William Bell, Executive Director 2. Selection of URA Board Chairperson

Consideration of nominees for URA Board Chairperson. Action: Consider making a motion to nominate a URA Board Chairperson

3. Consent Agenda - Ratification of Taxing Entity Agreements

Consideration of ratification of Taxing Entity Agreements with: - Bostwick Park Water Conservancy District - City of Montrose - Colorado River Water Conservation District - Montrose County, Colorado - Montrose County School District - Montrose Fire Protection District - Montrose Library District - Montrose Recreation District - Tri-County Water Conservancy District - West Montrose Sanitation District Action: Consider making a motion to approve the Taxing Entity Agreements as listed above.

4. Pre-URA Planning Costs - reimbursement agreement with City of Montrose

Consideration of approval of Promissory Agreement with City of Montrose for reimbursement of pre-URA planning costs. Action: Consider making a motion to approve a Promissory Agreement with City of Montrose for reimbursement of pre-URA planning costs.

5. Project Refresher and Organizational Structure Review

- Paul Benedetti, Attorney, and Mike Andersen, Anderson Analytics 6. Infrastructure Improvements and Capital Plan

- Scott Murphy, City Engineer, and David Dragoo, President, Mayfly Outdoors 7. Discussion Related to Long Term Financing Options 8. Future Meeting Dates and Topics 9. Adjournment

PROPERTY TAX INCREMENT REVENUE AGREEMENT (Bostwick Park Water Conservancy District)

1.0 AGREEMENT. This Agreement (the "Agreement") is made and executed effective as of :--:--__ -',20 17, by and between the MONTROSE URBAN RENEWAL AUTHORITY, a body corporate and politic of the State of Colorado (the "Authority") and the BOSTWICK P ARK WATER CONSERVANCY DISTRICT, a political subdivision of the State of Colorado (the "District") (the Authority and the District are referred to herein individually as a "Patty" and collectively as the "Parties").

2.0 RECITALS. The following recitals are incorporated III and made a pm of this Agreement. Capitalized terms are defined in Section 4.0.

2.1 Proposed Redevelopment. The Patties have been advised that the real property described in Exhibit A (the "Property") lying within the corporate limits of the City of Montrose (the "City") is being considered by the City Council of the City as an urban renewal area to be redeveloped by the current owner ("Owner") as an outdoor business park that will eliminate existing barriers to development and result in the creation of significant new jobs all of which will benefit the region, including the City and the District.

2.2 Urban Renewal and Tax Increment Financing. To accomplish the proposed redevelopment and to provide certain required public improvements it is necessary to include the Property in an urban renewal plan, entitled as tile "Urban Renewal Plan for the Colorado Outdoors Urban Renewal Project" (the "Plan" or "Urban Renewal Plan") authorizing and utilizing tax increment financing in accordance with the Colorado Urban Renewal Law, Patt I of Article 25 of Title 31, C.R.S. (the "Act"), to pay Eligible Costs of the Public Improvements. The proposed Plan that includes the Property is attached to this Agreement as Exhibit A.

2.3 Nature of Urban Renewal Project and Purpose of Agreement. The proposed Urban Renewal Project consists of designing, developing and constructing the Improvements (which includes paying the Eligible Costs of Public Improvements) necessary to serve the proposed Urban Renewal Area and to comply with §31-25-107(4)(g) of the Act that requires the Plan to afford maxinlUm opportunity, consistent with the sound needs of the municipality as a whole, for the rehabilitation or redevelopment of the Urban Renewal Area by private enterprise. The Urban Renewal Area contains Agricultural Land that requires compliance with the amendments to the Act contained in HB 10-I 107 and is subject to the requirements imposed by HB 15-1348 for new urban renewal plans adopted after January I, 2016. The Authority has submitted to the District the Impact Report required by §31-25-107(3 .5) of the Act, which includes information necessary to comply with HB 10-1107 and HB 15-1348.

2.3.1 The Urbatl Renewal Project is projected to create significant new employment opportunities and other benefits as specified in the Impact Report that will benefit the Parties, the region, and the State of Colorado.

2.3.2 The Duration of tinle estimated to complete the Urban Renewal Project is the 25-year period the period of time specified in §31-25-109(a) of the Act.

2.3.3 The estimated annual Propelty Tax Increment Revenue to be generated by the Urban Renewal Project for the Duration of the Urban Renewal Project and the pOltion of such Property Tax Increment Revenue to be allocated to fund the Urban Renewal Project are set forth in Sections 5.0 and the Impact Report.

2.3.4 The nature and relative size of the revenue and other benefits expected to accrue to the City, the District, and other taxing entities that levy propelty taxes in the Urban Renewal Area are set fOlth in the lmpact RepOlt and include, without limitation:

2.3.4.1 The step up in value of the Agricultural Land for the purpose of establishing the initial base value of the Urban Renewal Area and calculating the subsequent TlF value in accordance with the requirements ofHB 10-Ll07 and §31-25-107(9)(g) of the Act;

2.3.4.2 The increase in base value resulting from biennial general reassessments for the Duration in accordance with §31-25-1 07(9)(e) of the Act;

2.3.4.3 The benefit of improvements in the Urban Renewal Area to existing taxing entity infrastructure in accordance with §31-25-107(3.5) of the Act;

2.3.4.4 The estimate of the impact of the Urban Renewal Project on District and taxing entity revenues in accordance with §31-25-1 07(3.5) of the Act;

2.3.4.5 The cost of additional District and taxing body infrastructure and services required to serve development in the Urban Renewal Area in accordance with §31-25-107(3.5) of the Act;

2.3.4.6 The capital or operating costs of the Parties, the City, and other taxing bodies that are expected to result from the Urban Renewal Project in accordance with HB 15-1348.

2.3.4.7 The legal limitations on the use of revenues belonging to the Parties, the City, and any taxing entity in accordance with HB 15-1348;

2.3.4.8 The other estimated impacts of the Urban Renewal Project on District and other taxing body services or revenues in accordance with §31-25-1 07(3.5) of the Act.

2.4 Colorado Urban Renewal Law. In accordance with the Act as amended to the date of this Agreement (including the requirements of HB 10-1107 and HB 15-1348), the Patties desire to enter into this Agreement to facilitate adoption of the Plan and redevelopment of the proposed Urban Renewal Area described therein.

3.0 AGREEMENT, in consideration of the covenants, promises and agreements of each of the Patties hereto, to be kept and perfOlmed by each of them, it is agreed by and between the Parties hereto as set forth herein .

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4.0 DEFINITIONS. In this Agreement, unless a different meaning clearly appears from the context:

4.1 C.R.S.

"Act" means the Colorado Urban Renewal Law, Part 1 of Atticle 25 of Title 31,

4.2 "Agreement" means this Agreement, as it may be amended or supplemented in writing. References to sections or exhibits are to this Agreement unless otherwise qualified.

4.3 "Agricultural Land" shall have the same meaning as defined in §31-25-1 03 of the Act.

4.4 "Authority" means the Patty described in Section 1.0, the Montrose Urban Renewal Authority, a body corporate and politic of the State of Colorado.

4.5 "Bonds" shall have the same meaning as defined in §31-25-103 of the Act.

4.6 "City" means the City of Montrose Colorado.

4.7 "District" means the Party described in Section 1.0, the Bostwick Park Water Conservancy District, a political subdivision of the State of Colorado.

4.8 "District Tax Levy Allocation Revenues" means the portion of Property Tax Increment Revenues to be paid to the District fi'om the Special Fund as specified in Section 5.1.

4.9 "Duration" means the twenty-five year period that the tax increment or tax allocation provisions will be in effect as specified in §31-25-109(a) of the Act, the Plan, and the Impact Report.

4.10 "Eligible Costs" means those costs eligible to be paid or reimbursed from Property Tax Increment Revenues pursuant to the Act.

4.11 "[mpact RepOit" means the impact report setting forth the burdens and benefits of the Urban Renewal Project previously submitted to the District.

4.12 "Improvements" means the Public Improvements and Private Improvements.

4.13 "Party" or "Parties" means the Authority or the District or both and their lawful successors and assigns.

4.14 "Plan" means the urban renewal plan defined in Section 2.2.

4.15 "Project" shall have the same meaning as Urban Renewal Project.

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4.16 "Property Tax Increment Revenues" means all of the TIF revenues described in §31-25-107(9)(a)(II) of the Act allocated to the Special Fund for the Duration of the Urban Renewal Project.

4.17 "Remainder of tbe Property Tax Increment Revenues" means all of the Propelty Tax Increment Revenues remaining after payment of the District Tax Levy Allocation Revenues pursuant to tbis Agreement.

4.18 "Special Fund" means tbe fund described in tbe Plan and §31-25-1 07(9)(a)(II) of the Act into which the Propelty Tax Increment Revenues will be deposited.

4.19 "TlF" means the propelty tax increment pOition of tbe propeliy tax assessment roll described in §31-25-1 07(9)(a)(1I) of the Act.

4.20 "Urban Renewal Area" means the area included in the boundaries of the Plan.

4.21 "Urban Renewal Plan" means the Urban Renewal Plan for tbe Colorado Outdoors Urban Renewal Plan attached to this Agreement as Exhibit A.

4.22 "Urban Renewal Project" means all of the undertakings and activities, or any combination tbereof, required to carry out the Urban Renewal Plan pursuant to the Act.

5.0 PROPERTY TAX INCREMENT REVENUES. Tn compliance with the requirements of HB 15-1348 and to obtain the agreement of the District to the inclusion of Agricultural Land in the Urban Renewal Area as required by HE 10-1107, the Patties have negotiated and agreed to the sharing of Property Tax Increment Revenues as set forth herein.

5.1 The District Tax Levy Allocation Revenues. After deducting Three Percent (3.0%) for administration of this Agreement, the Authority agrees to calculate and pay to the District all of the net revenue it receives from the Montrose County Treasurer each year from the property tax levy of District against the TIF portion of the assessment roll (the "District Tax Levy Allocation Revenues"). The District Tax Levy Allocation Revenues to be paid to the District shall be placed in a separate account created for such purpose. Commencing on the date of this Agreement and for a period of twenty-five (25) years that the Authority is authorized to receive Property Tax Increment Revenues pursuant to the Act (the "Duration"), the Authority, on or before the 20th day of each month, shall pay to the District all such District Tax Levy Allocation Revenues received into such account through the preceding month.

5.2 Use and Purpose of District Tax Levy Allocation Revenues. The Dish·ict agrees that the purpose and use of the District Tax Levy Allocation Revenues paid by the Authority pursuant to this Agreement are to comply with the requirements ofHB 10-1107; §31-25-1 07(3.5) of the Act; and HB 15-1348 to address and compensate the District for the impacts of the Plan, including any subsequent modification thereto, on the District's revenues, infrastructure and services for the Duration of the Urban Renewal Project.

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5.3 Subordination Consent Required. With the prior written consent of the District, as evidenced by a resolution approved by the governing body of the District, the obligation of Authority to pay all or part of the District Tax Levy Allocation Revenues to the District may be made subordinate to any payment of the principal of, the interest on, and any premiums due in connection with Bonds, including loans or advances to, or indebtedness incurred by Authority for financing or refinancing, in whole or in part, the Urban Renewal Project.

6.0 CONSENTS AND WAIVERS. In consideration of the creation of the account and the transfer of the District Tax Levy Allocation Revenues to or on behalf of the District as described in Section 5.1, this Agreement shall constitute the agreement in writing by the District to the following provisions.

6.1 Inclusion of Agricultural Land in Urban Renewal Area. This Agreement constitutes agreement by the District to inclusion of the Agricultural Land in the Urban Renewal Area as required by HB 10-1107 and §3 1-25-1 07( 1)(c)(TI)(D) of the Act.

6.2 Pledge of Remainder of the Property Tax Increment Revenues. The District recognizes and agrees that the adoption and approval of the Plan includes an irrevocab le pledge of the Remainder of the Property Tax Increment Revenues to pay the Authority's Bonds and other financial obligations in connection with the Urban Renewal Project. The Authority has elected to apply the provisions of § 11-57-208, C.R.S., to this Agreement. The Remainder of the Propelty Tax Increment Revenues when and as received by the Authority are and shall be subject to the lien of such pledge for the Duration of the Project without any physical delivery, filing, or further act and is and shall be an obligation of the Patties pursuant to §3 1-25-1 07(9) of the Act. The Parties agree that the creation, perfection, enforcement and priority of the pledge of the Remainder of the Property Tax Increment Revenues shall be governed by § 11-57-208, C.R.S. The lien of such pledge on the Remainder of the Property Tax Increment Revenues shall have priority over any of all other obligations and liabilities of the Parties with respect to the Remainder of the Property Tax Increment Revenues.

7.0 NOTIFICATION OF SUBSTANTIAL MODIFICATIONS OF THE PLAN; AGREEMENT NOT PART OF PLAN. The Authority agrees to notify the District of any intended substantial modification of the Plan as required by §31-25-107(3.5)(a) of the Act. This Agreement is not patt of the Plan.

8.0 WAIVER. Except for the notices required by this Agreement, the District, as authorized by §3 1-25-107(9.5)(b) and §3 1-25-107(11) of the Act, the District hereby waives any provision of the Act that provides for notice to the District, requires any filing with or by the District, requires or permits consent from the District, and provides any enforcement right to the District for the Duration.

9.0 AGREEMENT CONFINED TO DISTRICT PROPERTY TAX INCREMENT REVENUES. This Agreement applies only to the Propelty Tax Increment Revenues described in Section 5.0, as calculated, produced, collected and paid to the Authority from the Urban Renewal Area by the Montrose County Treasurer in accordance with §31 -25-107(9)(a)(1l) of the Act and the rules and regulations of the Property Tax Administrator of the State of Colorado, and

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does not include any other revenues of the Pal1ies or the City.

10.0 MISCELLANEOUS .

10.1 Delays. Any delays in or failure of performance by any Pm1y of its obligations under this Agreement shall be excused if such delays or failure are a result of acts of God; fires; floods; earthquake; abnormal weather; strikes; labor disputes; accidents; regulation or order of civi l or military authoriti es; shortages of labor or materials; or other causes, similar or dissimilar, including economic downturns, which are beyond the control of such Party.

10.2 Termination and Subsequent Legislation or Litigation. 10 the event of termination of the Plan, including its TTF financing component, the Authority may terminate this Agreement by delivering written notice to the District. The Pal1ies further agree that in the event legislation is adopted or a decision by a court of competent jurisdiction after the effective date of this Agreement that invalidates or materially effects any provisions hereof, the Parties will in good faith negotiate for an amendment to this Agreement that most fully implements the original intent, purpose and provisions of th is Agreement, but does not impair any otherwise valid contracts in effect at such time.

10.3 Entire Agreement. This instrument embodies the entire agreement of the Pm1ies with respect to the subject matter hereof. There are no promises, terms, conditions, or obligations other than those contained herein; and this Agreement shall supersede all previous communications, representations, or agreements, either verbal or written, between the Parties hereto. No modification to this Agreement shall be valid unless agreed to in writing by the Parties.

10.4 Binding Effect. This Agreement shall inure to the benefit of and be binding upon the Parties and their successors in interest.

10.5 No Third-Party Enforcement. It is expressly understood and agreed that the enforcement of the terms and conditions of this Agreement, and all rights of action relating to such enforcement, shall be strictly reserved to the undersigned Parties and nothing in this agreement shall give or allow any claim or right of action whatsoever by any other person not included in this Agreement. 11 is the express intention of the undersigned Parties that any person or entity other than the undersigned Parties receiving services or benefits under this Agreement shall be an incidental beneficiary only.

10.6 No Waiver of Immunities. No portion of this Agreement shall be deemed to constitute a waiver of sovereign or governmental immunity that the Parties or their officers or employees may possess, nor shall any pOltion of this Agreement be deemed to have created a duty of care which did not previously exist with respect to any person not a party to this agreement.

10.7 Amendment. This Agreement may be amended only by an instrument in writing signed by the Parties.

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10.8 Parties not Partners. Notwithstanding any language in this Agreement or any other agreement, representation, or warranty to the contrary, the Patties shall not be deemed to be partners or joint venturers, and no Party shall be responsible for any debt 01' liability of any other Party.

10.9 Interpretation. All references herein to Bonds shall be interpreted to include the incurrence of debt by the Authority in any form consistent with the definition of "Bonds" in the Act, including payment of Eligible Costs or any other lawful financing obligation.

10.10 Incorporation of Recitals and Exhibits. The provisions of the Recitals and the Exhibits attached to this Agreement are incorporated in and made a part of this Agreement.

10.11 No Assignment. No Party may assign any of its rights or obligations under this Agreement.

10.12 Section Captions. The captions of the sections are set forth only for the convenience and reference of the Parties and are not intended in any way to define, limit, or describe the scope or intent of this Agreement.

10.13 Execution in Counterparts. This Agreement may be executed in several counterpatts, each of which shall be deemed an original and all of which shall constitute but one and the same instrument.

10.14 Governing Law. This Agreement and the provisions hereof shall be governed by and construed in accordance with the laws of the State of Colorado.

10.15 No Presumption. The Parties to this Agreement and their attorneys have had a full opportunity to review and participate in the drafting of the final form of this Agreement. Accordingly, this Agreement shall be construed without regard to any presumption or other rule of construction against the Party causing the Agreement to be drafted.

10.17 Days. Tf the day for any performance or event provided for herein is a Saturday, a Sunday, a day on which national banks are not open for the regular transactions of business, or a legal holiday pursuant to C.R.S. § 24-11-101(1), such day shall be extended until the next day on which such banks and state offices are open for the transaction of business.

[Signature page follows]

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IN WITNESS WHEREOF, the Parties hereto have caused their duly authorized officials to execute this Agreement effective as of the day and year first above written.

ATTEST:

By:

ATTEST:

By: ______ ____ _ SecretarylExecutive Director

DISTRICT:

BOSTWICK PARK WATER CONSERVANCY DISTRICT, a political subdivision of the State of Colorado:

By: --=---{lLL~=---..el/1~rL=-l1;~Q_ President

AUTHORITY:

MONTROSE URBAN RENEWAL AUTHORITY

By: _____________ _ Chair

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RESOLUTION # 2017.04.05 Bostwick Park Water Conservancy District

At a special meeting of the Board of Directors of Bostwick Park Water Conservancy District ("District") duly posted and held on April 5, 2017 at the District's office, 400 S. 3rd St., Montrose, CO at 5:00 p.m. at which time all six directors were present, whether in person or by telephone, constituting a quorum, after discussions, and

UPON A MOTION duly made and seconded, by a unanimous vote,

IT IS HEREBY RESOLVED THAT:

1. On January 4,2017, the District declined to enter into an agreement regarding the proposed Urban Renewal Plan for the Colorado Outdoors Urban Renewal Project.

2. Upon further negotiation, the District shall now enter into a revised agreement with the Montrose Urban Renewal Authority (the "Authority") entitled PROPERTY TAX INCREMENT REVENUE AGREEMENT, a copy of which is attached hereto as Exhibit A.

3. Allen Distel, as President ofthe District, and Tom Wise, as Secretary of the District, are hereby authorized to execute the PROPERTY TAX INCREMENT REVENUE AGREEMENT, attached hereto as Exhibit A.

Dated effective the 5th day of April, 2017

Bostwick Park Water Conservancy District

By: a~L . L2uufJI Allen Distel, President

ATTEST: --r:...u.~,--",-=-<"",-"""",----To

I ce r tify that the foregoing is a true a nd accura t e copy of Resolution #2017.04.05 add.pted by the Boa rd of Director s on April 5 , 20 17 and filed in the official r ecords of the Bostwick Park \Vater Conservan cy District.

Allen Distel, P..resid'ent

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COOPERA TrON AGREEMENT (Colorado Outdoors Urban Renewal Project)

1.0 PARTIES. This Agreement (the "Cooperation Agreement") is made as of May I , 2017, by and between the CITY OF MONTROSE, a home rule city of the State of Colorado (the "City"), and the MONTROSE URBAN RENEWAL AUTHORITY, a body corporate and politic of the State of Colorado (the "Authority"). The City and the Authority are referred to herein individually as a "Patty" and collectively as the "Parties."

2.0 RECITALS . The following recitals are incorporated in and made a part of thi s Agreement. Capitalized terms are defined in Section 4.0.

2.1 The Plan. The City Council of the City approved an urban renewal plan entitled "The Urban Renewal Plan for the Colorado Outdoors Urban Renewal Project" (the "Plan") On Februat·y 7, 2017, by Resolution No. 2017-1. The Plan provides for the allocation of all Properly Tax Increment Revenues and all municipal Sales Tax Increment Revenues (except for the revenues from the 0.3% municipal sales tax for recreation district facilities approved by the voters of the City on April 1,2014, which revenues are excluded from such allocation) pursuant to §3 1-25-107(9)(a)(II) of the Colorado Urban Renewal Law (the "Act"). The City also desires to pledge that portion of the increment revenues produced by the Hotel Room Tax and Meal Tax in the area included in the Plan (the "Urban Renewal Area") to further the purposes of the Plan.

2.2 Redevelopment. PLu·suant to the directive in the Act that the Plan afford maximLul1 opportunity fo r the rehabilitation or redevelopment of the Area by private enterprise, the Authority anticipates entering into one or more Development Agreements with private owners for the rehabilitation or redevelopment of the Area to reimburse eligible costs ("Eligible Costs"), including, without limitation, reimbursement of costs authorized by §3 l-25-1 07(9)(i) of the Act, sh·eet and utility improvements, drainage improvements, landscaping, erosion control, recreational .facili ties, and other eligible items (collectively, the "Public Improvements") within the Area.

2.3 Purpose of Cooperation Agreement. In order to pay for the reasonable and necessary costs of the Public Improvements it is necessary and in the public interest that the Parties enter into this Cooperation Agreement to facilitate financing of the Public Improvements, whether through direct payment of Pledged Revenues by the City or Authority pursuant to reasonable loan terms, reimbursement payments to owners of Eligible Costs or the pledge of such Pledged Revenues to a metropolitan district or other entity for such purpose, or any combination thereof.

3.0 TERMS AND CONDITIONS. In consideration of the mutual covenants and promises of the Parties contained herein, and other valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Patties agree as set forth in this Cooperation Agreement.

4.0 DEFINITIONS. III tlus Agreement, unless a different meaning clea rly appears from the context:

4.1 c.R.S .

"Act" means the Colorado Urban Renewal Law, Part I of Article 25 of Title 31,

4.2 "Authority" means the Party described in Section I .0, the Montrose Urban Renewal Authority, a body corporate and politic of the State of Colorado.

4.3 "Bonds" shall have the same meaning as defined in §31-25-1 03 of the Act.

4.4 "City" means the Party described in Section 1.0, the City of Montrose Colorado, a home rule city of the State of Colorado.

4.5 "Cooperation Agreement" means this agreement as it may be amended or supplemented in writing. References to sections or exhibits are to this Agreement unless otherwise qualified.

4.6 "Development Agreement(s)" means one or more of the agreements described in Section 5.0.

4.7 "Duration" means the twenty-five year period that the tax increment or tax allocation provisions ofthe Plan will be in effect as specified in §31-25- 1 09(a) of the Act, the Plan, and the [mpact RepOlt.

4.8 "Eligible Costs" means those costs eligible to be paid or reimbursed from Pledged Revenues pursuant to the Act, the Plan, this Cooperation Agreement, or any other agreement, including one or more Development Agreements.

4.9 "Hotel Room Tax" means the 0.9% tax levied on hotel and other lodging rooms or accommodations pursuant to §5-2- 1 of the Montrose Municipal Code.

4.10 "Hotel Room Tax Revenues" means the revenues produced by the levy of the Hotel Room Tax in the Urban Renewal Area in excess of the base amount for such revenues, which base amOlU1t is zero.

4.11 "Impact Report" means the impact report setting fOlth the burdens and benefits of the Urban Renewal Project prepared by Anderson Analytics in cOlmection with preparation of the Plan.

4.12 "Improvements" means the Public Improvements and Private Improvements.

4.13 "Meals Tax" means the 0.8% tax levied on the amount charged by restaurants and like places of business for food and drink sales pursuant to §5-2-1 of the Montrose Municipal Code.

4.14 "Meals Tax Revenues" means the revenues produced by the levy of the Meals Tax in the Urban Renewal Area in excess of the base amOlU1t for such revenues, which base amount is zero.

4.15 "Party" or "Parties" means the City or the Authority or both and their lawful successors and assigns.

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4.16 "Phase One Private Improvements" means the Private Improvements described in Exhibit B, attached to and made a part hereof, that are proposed to be constructed in the Urban Renewal Area.

4.17 "Phase One Public Improvements" means the public improvements generally depicted in Exhibit A, attached to and made a part hereof, that must be financed, designed and constructed to serve the Phase One Private Improvements.

4.18 "Plan" has the same meaning as Urban Renewal Plan.

4.19 "Pledged Revenues" means the Property Tax Increment Revenues, the Sales Tax Increment Revenues, the Hotel Room Tax Revenues and the Meals Tax Revenues and the interest earned on the Pledged Revenues in the Special Fund.

4.20 "Private Improvements" means the buildings and other taxable improvements to be constructed in the Urban Renewal Area.

4.21 "Pro ject" shall have the same meaning as Urban Renewal Project.

4.22 "Property Tax Increment Revenues" means all of the propetiy tax revenues described in §3 1-25-107(9)(a)(Il) of the Act allocated to the Special Fund for the Duration in accordance with the Plan. The amounts remaining in the Special Fund after deducting the fees and payments required by any applicable TIF Sharing Agreement sha ll be used pay reasonable and necessary Eligible Costs.

4.23 "Public Improvements" means, without limitation, street and utility improvements, drainage improvements, landscaping, recreation facilities, erosion control, site grading, signage, flood control facilities , costs authorized by §3 l-25-l 07(9)(i) of the Act, and other improvements necessary to carry out the Urban Renewal Plan.

4.24 "Sales Tax Increment Revenues" means all of the revenues from the 3.0% municipal sales taxes imposed on transactions subject to such tax as allocated to the Special Fund pmsuant to the Plan and §3l-25-1D7(9)(a)(II) of the Act in excess of the base amount for such revenues which is zero; provided however, Sales Tax Increment Revenues shall not include the revenues ii'om the 0.3% municipal sales tax for recreation district facilities approved by the voters of the City on Aprill, 2014.

4.25 "Special Fund" means the fund described in the Plan and §3l-25-107(9)(a)(II) of the Act into which the Pledged Revenues will be deposited.

4.26 "TIF Sharing Agreements" means the revenue sharing agreements between the Authority and the taxing bodies that levy property taxes in the Urban Renewal Area not all of which share revenue.

4.27 "Urban Renewal Area" means the area included in the boundaries of the Plan.

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4.28 "Urban Renewal Plan" means the Urban Renewal Plan for the Colorado Outdoors Urban Renewal Plan described in Section 2. 1.

4.29 "Urban Renewal Project" means all of the undertakings and actIVItIes, or any combination thereof, required to carry out the Urban Renewal Plan pursuant to the Act.

5.0 COOPERATION REGARDING THE PROJECT, PLAN , AND AGREEMENTS. The Authority agrees to carry out the Urban Renewal Project in accordance with the Act and the Plan. The Pallies agree to cooperate to achieve the timely and successful construction of Improvements required to complete redevelopment of the Urban Renewal Area, including, without limitation, financing the Public Improvements and to carry out the duties and obligations required by the terms of Development Agreements that may from time to time be entel'ed into between the Authority and property owners and developers for redevelopment of the Area in accordance with the Plan.

6.0 ADDITIONAL PROJECT FINANCING. Pursuant to the Act, the Parties wi ll cooperate and work with owners and developers and , if applicable, metropolitan districts and other similar entities to issue financial instruments to finance necessary undellakings and activities to carry out the Plan and the Urban Renewal Project. The Parties will cooperate to timely collect and deposit the Pledged Revenues in the Special Fund. Pledged Revenues that are in control of the City shall be paid to the Authority or its designated depository as a11d when collected in accordance with the Act for deposit into the Special Fund.

7.0 SPECIAL FUND. The Authority (or the City on behalf of the Authority) agrees to establish a11d maintain the Special Fund for the Duration of time the tax increment provisions described in §31-25-107(9)(a)(II) of the Act and the Plan are in effect.

8.0 PLEDGED REVENUES. The Pledged Revenues to be deposited in the Special Fund consist of the following revenues.

8.1 Property Tax Increment Revenues. Property Tax Increment Revenues shall be deposited in the Special Fund by or on behalf of the Authority when and as received from the Montrose County Treasmer. The Property Tax Increment Revenues shall be separated into such separate accounts as required by those TIF Sharing Agreements that requ ire establishment, maintenance, and payment of a portion of such Property Tax Increment Revenues to those taxing bodies that have such a payment right. Except for the fees and payments required to be made pursuant to such applicable TIF Sharing Agreements, the balance of Property Tax Increment Revenues shall be maintained in the Special Fund and used to finance activities and undertakings in furtherance ofthe Urban Renewal Plan and Urban Renewal Project.

8.2 Sales Tax Increment Revenues. The City agrees to collect the Sales Tax Increment Revenues in the same manner as it collects all other City general sales taxes, and deposit such revenues in the Special FIUld, after deducting from such revenues the proportionate share of collecting and enforcing collection of such Sales Tax Increment Revenues in the Urban Renewal

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Area. It is agreed by the Patties that the obligation of the City to pay the Sales Tax Increment Revenues to the Special Fund in accordance with the Act, the Plan, and this Cooperation Agreement is a multiple-fiscal year ob ligation of the City, which obligation shall remain in effect for the full 25-year Duration of the time that the tax allocation provisions of the Act and the Plan are in effect.

8.3 Hotel Room Tax Revenues and Meals Tax Revenues. The City agrees (0 collect the Hotel Room Tax Revenues and Meal Tax Revenues in the same manner that it collects such taxes pursuant to Chapter 5.2 of the Montrose Municipal Code and to deposit such revenues in the Special Fund, after deducting from such revenues the propOitionate share of co llecting and enforcing collection of such Hotel Room Tax Revenues and Meal Tax Revenues in the Urban Renewal Area.

8.3. 1 Use. The Hotel Room Tax Revenues and Meal Tax Revenues shall be used for and applied to payment of Eligible Costs related to attracting tourist and visitor business to the Urban Renewal Area and the City at large.

8.3.2 Annual Appropriation. Unless the City determines otherwise in its reasonable discretion, the obligations of the City under this Cooperation Agreement with respect to the Hotel Room Tax Revenues and Meal Tax Revenues shall be from year to year only and shall not constitute a mandatory payment obi igation of the City in any fiscal year beyond the present fiscal year. This Cooperation Agreement shall not directly or indirectly obligate the City to make any payments with respect to such Hotel Room Tax Revenues and Meal Tax Revenues beyond those appropriated for any fiscal year in which this Cooperation Agreement shall be in effect. The City Manager (or any other officer or employee at the time charged with the responsibility of formulating budget proposals) is hereby directed to include in the budget proposals submitted to the City Council, in each year prior to termination or expiration of tllis Cooperation Agreement, the Hote l Room Tax Revenues and Meal Tax Revenues necessary to meet its obligations hereunder, it being the intent, however, that the decision as to whether to appropriate such anlounts shall be at the discretion of the City Council.

8.4 Authority Pledge. In accordance with the terms and conditions as set forth in thi s Cooperation Agreement, the Authority has the unqualified right to pledge the Pledged Revenues, in whole or in patt, to the City, any Bond trustee, atly developer or owner or any metropolitan di strict or other entity that provides financing for the Urban Renewal Proj ect, as applicable. In accordance with the Act and the Supplemental Public Securities Act, such pledge by Authority shall create a lien on the Pledged Revenues which shall take effect immediately without any physical delivery, filing, or further act. The lien of such pledge has atld sha ll have priority over any or all other obligations and liabilities of the Authority and sha ll be valid, binding, atld enforceable as against all persons having claims of any kind in tOlt, contract, or otherwise against the Authority irrespective of whether such persons have notice of such liens.

8.5 Collection of Pledged Revenues; Continuing Cooperation. The City agrees to pursue all of the lawful procedures and remedies available to the City to collect the Sales Tax Increment Revenues, Hotel Room Tax Revenues and the Meals Tax Revenues and to cause such revenues to be applied in accordance with thi s Cooperation Agreement. If any further cooperation or other agreements or amendments shall be necessary or appropriate (a) in order to accomplish

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the collection of such revenues and the allocation and payment thereof to the Authority in accordance with this Cooperation Agreement or (b) to carry out the Project in accordance wi th the Plan and the Act, the City agrees to exercise its reasonable best efforts to secure the approval of such additional agreements; provided that such efforts do not require the incurring of any costs or expenses by City unless the same are advanced or paid by Authority.

8.6 Duty to Maintain Records; Right to Audit. The Parties shall cooperate to maintain accurate records of all Pledged Revenues rece ived or allocated to Authority, and all amounts expended, assigned or paid therefi'om, and of all documentation supporting such expenditures, assignments and payments, in accordance with generally accepted accounting practices and in a format that will permit audit, for a period of not less than three (3) years after the Duration. Such records shall be made available for reasonable inspection, reproduction and audit by the City's authori zed aud itor and authorized representatives, during normal business hours.

9.0 AMENDMENT OF PLAN. The City covenants and agrees that it shall cooperate with the Authority in carrying out and diligently continuing to completion, the Project in accordance with the Plan and the Act. The Plan may be amended, but no amendment shall be approved by the City unless the Authority shall determine that such amendment will not substantially impair the security or tax exemption for any ontstanding Bond or other obligation of the Authority, any metropolitan district or other entity, or any owner or developer, or pledge of the Pledged Revenues or the ability of the Authority to perform its obligations with respect thereto .

10.0 PERMITS AND LICENSES. Consistent with all applicable laws, codes and ordinances, the City shall cooperate with the Authority and any designated owner or developer in the Urban Renewal Area by timely acting upon, from time to time, applications for City-required permits and li censes in accordance with City's Municipal Code.

11 .0 REVIEW OF PLANS. The City shall cooperate with the Authority and any designated owner or developer in the Urban Renewal Area by timely reviewing all plans, plats, agreements and other submissions required to be reviewed by the City in connection with the construction of the Public Improvements and Private Improvements contemplated by any applicable Development Agreement and the Plan. Where appropriate, the City agrees to implement any applicable procedures for expedited review and approval permitted by applicable law in f1ll1herance of the Plan.

12.0 VACATIONS; DEDICATIONS . The City, subject to applicable laws, will initiate and pursue appropriate action as may be required to vacate streets, alleys, and other ri ghts of way requested by the Authority to carry out the Plan; grant and alter easements or revocable permits in and tlu'ough public rights of way; and accept dedication of rights of way, and easements in connection with the Project; provided, however, that nothing in this section shall be construed as a limitation upon the exercise of legislative discretion by City or a delegation of legislative authority.

13.0 CITY, AUTHORITY, OR OTHER PUBLIC BODY NOT INDEBTED. In accordance with the provisions of §3 1-25-109(6) of the Act, any Bond, Development Agreement, indenture, loan agreement, or any other instrument or debt obligation issued by the Authority in connection

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with the Project shall not constitute an indebtedness of the State of Colorado or any county, municipality, or public body, but shall be payable solely from amounts pledged therefor, including the Pledged Revenues.

14.0 ENFORCED DELAY. Neither the City nor the Authority shall be considered in hreach of, or in default in, its obligations with respect to tlus Cooperation Agreement in the event of delay in the performance of such obligations due to causes beyond its control and without its fault or negligence, it being the purpose and intent of thi s provision that if such delay occurs, the time or times for performance by either Party affected by such delay shall be extended for the period of the delay. The Party seeking the benefit of this provision shall give written notice of any such delay to the other Party witlun thirty (30) days after such P31iy knows of such delay.

15.0 NO THIRD PARTY BENEFICIARI ES. Neitller the City nor the Autllority shall be obligated or li able under the terms of this Cooperation Agreement to any person or entity not a party hereto.

16.0 SEVERABILITY. Incase anyone or more of the provisions contained in thi s Cooperation Agreement or any application thereof, shall be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions of this Cooperation Agreement, or any other application thereof, shall not in any way be affected or impaired thereby.

17.0 GOVERNING LAW. This Cooperation Agreement shall be governed by, and constmed in accordance with, the laws ofthe State of Colorado.

18.0 HEADINGS . Section headings in this Cooperation Agreement are for convenience of reference on ly and shall not constitute a part of thi s Cooperation Agreement for any other purpose.

19.0 ADDITIONAL OR SUPPLEMENTAL AGREEMENTS. The PaIiies mutually covenant and agree that they will execute, deliver and furnish such other instmments, documents, materials, and information as may be reasonably required to carry out the Plan and agreements required to implement the Plan, including, without limitation, this Cooperation Agreement.

20.0 MINOR CHANGES. This Cooperation Agreement has been approved in substantially the fo rm submitted to the governing bodies of the Pmiies. The officers executing the Cooperation Agreement have been authorized to make, and may have made, minor changes in the Cooperation Agreement as they have considered necessary. So long as such changes were consistent with the intent and understanding of the Parties at the time of approval by the governing bodies, the execution of the Cooperation Agreement shall constitute conclusive evidence of the approval of such changes by the respective Pm·ties.

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IN WITNESS WHEREOF, the Parties have caused this Cooperation Agreement to be duly executed and delivered by their respective officers as of the date first above written.

CITY OF MONTROSE

ATTEST:

City Clerk

MONTROSE URBAN RENEWAL AUTHORITY

ATTEST:

By: ____ ~~-----------------------Chair

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