Oxbow Golf Course vs Fargo Flood Protection

$65-$90 Million Dollar OHB Project

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INTERIM AGREEMENT
Oxbow Golf and Country Club/Diversion Authority

THIS AGREEMENT is made and entered into this August of 2014 by and between the
METRO FLOOD DIVERSION BOARD OF AUTHORITY, a joint powers entity established
by the 2011 Limited Joint Powers Agreement, as amended, between Clay County, Minnesota,
Moorhead, Minnesota, Cass County, North Dakota, Fargo, North Dakota, Cass County Joint
Water Resource District and the Buffalo-Red River Watershed District [hereinafter referred to as
the “Diversion Authority”] and OXBOW GOLF AND COUNTRY CLUB, a North Dakota
nonprofit corporation, of Oxbow, North Dakota [hereinafter referred to as “Oxbow CC”].

WHEREAS, a flood risk reduction levee surrounding the communities of Oxbow,
Hickson and Bakke has been designed and is being constructed [the “OHB Levee Project”]; and,

WHEREAS, construction of the proposed levee will cross through the existing golf
course of the Oxbow CC which would:

require the destruction of golf holes;

require the destruction or removal of the clubhouse and related facilities, as well as
the loss of landscaping, mature trees, and certain views and vistas that are unique
features of the golf course;

leave certain holes (presumably the existing holes 1 through 6 and 18) on the existing
golf course unprotected by the O-H-B Levee;

cause other remaining golf holes to need some level of modification as a result of the
O-H-B Levee project;

require the replacement of the club house facility including the practice area, events
area, pool, parking lots, and other like kind amenities, which shall be built to all
applicable federal, state, and local building codes;

require funds to reimburse or compensate Oxbow G&CC for the losses recognized by
the federal business acquisition process for interruption of business such as
interruption during the construction phase of the project.

WHEREAS, the Diversion Authority has entered into a Memorandum of Understanding
with the City of Oxbow regarding the O-H-B Levee (Oxbow MOU), to which the Oxbow CC
was not a party, but which sets forth terms involving the Oxbow CC property, improvements,
and buildings.

WHEREAS, pursuant to the Oxbow MOU, and as part of the OHB Levee Project certain
acreage lying south of the city of Oxbow was acquired for the purpose of providing land for the
routing of the levee, itself, along with land to be used for replacement residential lots, for the
streets and other amenities that will serve said replacement lots, for replacement of portions of
the Oxbow CC golf course and land upon which a replacement clubhouse (and surrounding
facilities) will presumably be located; and,

WHEREAS, the Diversion Authority wishes to acquire portions of the real property and
improvements owned by Oxbow CC, including the club house and surrounding facilities as well
as a portion of the 18-hole Oxbow Golf Course—said acquisition due to the fact that the intended
route of the levee will lie on or near the site of the existing clubhouse and will sever the 18-hole
golf course into two portions with a number of holes lying on the easterly side of the levee and/or
negatively impacted by the levee; and

WHEREAS, as part of said acquisition, the Diversion Authority will also propose certain
relocation assistance including the replacement of the impacted holes to be acquired from
Oxbow CC along with the relocation of several additional holes, said replacement and relocated
holes to be located on the aforesaid replacement land lying south of the city of Oxbow; and

WHEREAS, construction on the replacement golf holes has already commenced with the
initial earth work necessary to bring the replacement golf holes at a rough grade; however,
additional earth work, fine grading and shaping is necessary to finish construction of said
replacement holes and to prepare said holes to receive grass seed and other improvements (i.e.
sand for bunkers, etc.) [hereinafter referred to as the “Finish Construction”]; and

WHEREAS, both Diversion Authority and Oxbow CC would like said golf course
Finish Construction to commence as soon as reasonably possible and it is the hope of the parties
hope that work can be completed to such stage that grass seed can be planted before the end of
the customary construction season in 2014;

NOW, THEREFORE, IT IS HEREBY AGREED:

1. The Diversion Authority agrees that it shall enter into good faith negotiations for
a comprehensive agreement providing funds for the following:

1.1 For acquisition funding to the Oxbow CC for such land, buildings
(clubhouse) and improvements (pool, parking lot, events area, and related
items) as is necessary for the O-H-B Levee to be constructed.

1.2 For acquisition funding to the Oxbow CC for any land and improvements
(including land used as golf holes) that would remain unprotected from
flooding induced by the Metro Flood Project.

1.3 To reimburse Oxbow CC for all reasonable costs incurred in modifying
existing golf holes that will remain within the protected area but which will
need to be modified to adapt said holes to the re-routed golf course layout
(re-routed because of the O-H-B Levee).

1.4 The funds provided by the Diversion Authority shall be adequate allow for
replacement of an equivalent (in terms of size, design, quality, and function)
clubhouse, events area, practice area, swimming pool, parking lot and
provide for the replacement of the loss of landscaping, mature trees, and
certain views and vistas that are unique features of the golf course. The
funds provided by the Diversion Authority shall be adequate to allow for
reasonable moving and business interruption costs incurred by Oxbow CC.

1.5 Golf Course Designer. The funding provided by the Diversion Authority
will include the cost of the engagement of Robert Trent Jones, Jr., and his
firm, for golf course design work to be done on the Oxbow CC, as well as
the cost of the engagement of a Country Club Architect for the replacement
clubhouse and related amenities. The Diversion Authority will fund the
construction of displaced golf holes within this design, subject to the terms
of a further agreement to be entered into with Oxbow CC.

1.6 Replacement Land. The Diversion Authority has or may obtain land from
the City of Oxbow, or make arrangements with the City of Oxbow to
provide land to Oxbow CC, to be used for replacement of existing golf holes
obtained by the Diversion Authority, taking into consideration the unique
nature of the existing holes, (including landscaping, mature trees, and
certain views and vistas) to be taken and the value of land used for
replacement.

1.7 Loss of Revenue. In the event that re-construction of the Oxbow CC does
not allow for the Oxbow CC to fully function as contemplated in paragraph
2, the Diversion Authority shall provide funds to reimburse Oxbow CC for
the loss of revenue occasioned by it not being able to fully function during
the construction phase of the project.

2. Golf Course Architect Services. Diversion Authority hereby agrees to advance
such funds as may be necessary for Oxbow CC to enter into a contract for the services of Robert
Trent Jones, Jr., Golf Course Architect firm for the further development of drawings and
construction bid specifications and for such other golf course architecture services as may be
necessary or appropriate to allow construction of the golf course replacement holes to progress.

3. Golf Course Construction Bidding and Entry into Construction Agreement.
Oxbow CC may move forward immediately to advertise for bids for the said Finish Construction
on any and all golf holes. Upon identification of the lowest and best bid for said construction,
subject to the approval of the project managing consultant for the Diversion Project [currently,
CH2M Hill engineering firm], Oxbow CC may enter into said construction contract and the
Diversion Authority will advance funds necessary to fulfill Oxbow CC’s payment obligations
under said construction contract. The Diversion Authority intends that the sequence of
construction will staged so that construction of the new golf course holes, modification of
existing golf holes that will remain within the protected area, and construction of the new
clubhouse, practice area, events area, swimming pool and parking lot shall be complete prior to
the removal of the existing Oxbow CC buildings and land for purposes of building the O-B-H
Levee.

4. The parties recognize and agree that this is to be an interim agreement—an
agreement that will be replaced or amended by a more comprehensive agreement, yet to be
negotiated, agreed and executed, that will address the acquisition of real property and
improvements from Oxbow CC and any relocation assistance as required by law as is set forth
under paragraph 1., above.

5. The Diversion Authority recognizes and agrees that it will advance the funds as
set forth under paragraphs 2 and 3 herein at its own risk and without prejudice to the interests of
Oxbow CC as a property owner. Should the parties be unable to enter into such agreement or
agreements for the acquisition of real property and improvements; the providing to Oxbow CC of
relocation assistance as may be required by law (such as assistance allowing Oxbow CC funds
for the relocation and reconstruction of a replacement clubhouse and related facilities); and any
other funds or benefits as may be required by law and in the event, therefore, that such matters,
or any of them, be decided by a court of law, then to the extent such court awards damages in
favor of Oxbow CC for the value of such items, then the funds advanced by the Diversion
Authority pursuant to this Interim Agreement shall not be offset against the damages awarded to
the Oxbow CC.

Dated effective the date and year last executed by the parties below.

METRO FLOOD DIVERSION BOARD
OF AUTHORITY

DATED: ________________ By: ________________________________________

Darrell Vanyo, Chairman

OXBOW GOLF AND COUNTRY CLUB, a
North Dakota nonprofit corporation

DATED: ________________ By: ________________________________________

Chris Holland, its President

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