HomeMy WebLinkAboutOrdinance No. 4566 - Ordinance: Gas Franchise Amendment 92A
ORDINANCE NO. ____
AN ORDINANCE AMENDING AND REENACTING CHAPTER 92A
OF THE ROCHESTER CODE OF ORDINANCES RELATING TO A
GAS FRANCHISE.
THE COMMON COUNCIL OF THE CITY OF ROCHESTER DO ORDAIN:
Section 1. Chapter 92A of the Rochester Code of Ordinances is hereby
amended and reenacted to read as follows:
92A. GAS FRANCHISE
92A.10. Definitions. The following words used in this chapter will have the
meanings ascribed to them in this section except when the content clearly indicates a
different meaning.
Subd. 1. “City” means the City of Rochester, County of Olmsted, State of
Minnesota.
Subd. 2. “Company” means Minnesota Energy Resources, a subsidiary of
WPS Resources, a Delaware Corporation.
Subd. 3. “Effective Date” means the effective date of this Ordinance, that is,
upon adoption and publication, as provided by law.
Subd. 4. “Franchise” means the grant of rights made by City to Company in
this Ordinance, subject to its terms and conditions.
Subd. 5. “Gas” means natural gas, manufactured gas, a mixture thereof or
other form of gaseous energy.
Subd. 6. “MPUC” refers to the Minnesota Public Utilities Commission or any
successor regulatory agency.
Subd. 7. “Notice” means a writing served personally or by certified mail by any
party or parties on any other party or parties. Notice to Company shall be served upon
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Minnesota Energy Resources, 2665 145 Street West, Rosemount, Minnesota 55068.
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Notice to the City shall be served upon the City Administrator, City Hall , 201 4 Street
SE, Rochester, Minnesota 55904.
Subd. 8. “Public Grounds” means all real property owned by or dedicated to
the City, other than public ways, with respect to which City holds the legal right or title to
grant or withhold easement, leasehold or occupancy rights or servitudes to Company.
Subd. 9. “Public Rights-of-Way” means, streets, avenues, alleys, parkways,
and other public rights-of-way within the City.
92A.20 - The Franchise
92A.21. Franchise. Subdivision 1. City hereby grants and conveys to
Company the following non-exclusive rights and privileges within the City as its
boundaries presently exist and as they may be extended in the future:
A. The right and privilege to operate, construct and maintain a public
gas utility;
B. The right to occupy and utilize the City’s public rights-of-ways of City
for the purpose of enlarging, extending, operating, repairing and
maintaining, in, over, under and across the same, all gas pipes,
mains, and appurtenances which are necessary or customary in
accordance with sound utility practices for the purpose of the
transmission of gas, or the distribution of gas, for public and private
use; is granted provided that utilities first make use of existing utility
easements, where such easements are available, before occupying
and utilizing the City’s public rights of ways; and
C. The right to occupy and utilize the public grounds of City for the
purpose of enlarging, extending, operating, repairing and
maintaining, in, over, under and across the same, all gas pipes,
mains, and appurtenances which are necessary or customary in
accordance with sound utility practices for the purpose of the
transmission of gas, or the distribution of gas, for public and private
use. The right to occupy and utilize public grounds is subject to the
City’s approval of a revocable permit, which will contain conditions
including the Company’s responsibility for payment of removal or
relocation costs in a circumstance where a public project is proposed
for the public grounds.
Subd. 2. The franchise granted in subdivision 1 is subject to (A) this chapter;
(B) any applicable City of Rochester ordinance or permit procedure; (C) any applicable
City of Rochester customary and necessary practice; and (D) the City’s exercise of its
police power to adopt and enforce resolutions and ordinances necessary to the public’s
health, safety and welfare.
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92A.22. Franchise Term. The rights and privileges granted by the Franchise
shall remain in effect for a period of ten (10) years from the effective date. However, on
the tenth anniversary of the effective date, the City may, at its option, extend the Franchise
for an additional ten-year period subject to the provisions of this Chapter. Upon the
expiration of the initial term, the Franchise shall automatically renew for successive one-
year periods unless either party provides written notice of its intent not to renew at least
ninety (90) days prior to the expiration of the then-current term. At any time during a
renewal period, either party may propose modifications to the Franchise terms. If the
parties fail to reach an agreement on the revised terms, the Franchise shall continue
under existing terms until terminated in accordance with this ordinance.
92A.30 - Extension of Service
92A. 31. Extension of Service. Upon receipt and acceptance of a valid
application for service, Company shall, subject to its reasonable economic feasibility
criteria, provide such reasonable extensions of its mains and pipes from time to time as
are required to serve City and customers within the current and future limits of the City.
If such extensions are governed by any Company tariff on file with the MPUC, Company
shall provide City with a copy of the tariff and notice of any Company proposal to change
any tariff provision related to the extensions. Company shall apply any tariff in a
reasonable and liberal fashion so as to promote and maximize commerce and
development within the City and to the full extent permitted by law. In the event Company
proposes any charge for such extensions (sometimes referred to as aids to construction)
or in the event Company proposes to refuse to provide such extension, Company must
give notice of such action to the City.
92A.40 - Construction Restrictions
92A.41. Construction Restriction. Subdivision 1. Whenever the Company desires
to open or disturb any public right-of-way or public ground for the purpose of maintenance,
repair or laying of gas mains or pipes, it must give the City reasonable advance notice,
but not less than two business days, by filing a written notice with the Public Works
Director. In any case, Company cannot commence such work before obtaining from the
City an appropriate permit or other written consent. During the progress of the work, the
Company cannot endanger or unnecessarily obstruct the passage of traffic or the normal
and customary use of the public right-of-way or public ground.
Subd. 2. Company need not obtain any required permit or other written consent in
order to perform (A) routine maintenance or repairs where excavation is not required; or
(B) in an emergency situation when it is necessary for Company to act immediately to
remedy a situation that jeopardizes the public health or safety. However, in an emergency
situation, Company must as soon as practicable notify the City of the emergency situation
and its efforts to remedy the situation. In addition, in an emergency situation, the
Company must file its request for a permit no later than the second business day following
the occurrence.
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Subd. 3. Company must promptly and diligently restore public right-of-way and
public ground to as good condition as it was before the excavations were made. However,
the Company cannot interfere with any improvements being made by the City without the
City’s consent. The City shall not impose permit requirements upon the Company that is
different from the requirements imposed on other private small diameter utility providers
for similar restoration work.
Subd. 4. If Company fails to promptly restore the disturbed public right-of-way or
public ground within 30 days of notice by the City, City may do so at the Company’s
expense. Upon City's demand, Company must pay to the City it’s reasonable cost of
repair together with its administrative expense and overhead associated with the repair.
Subd. 5. During the progress of its work, Company must keep the public right-of-
way or public ground guarded in order to prevent accidents to persons or property.
92A.42. Upon the City’s request and within a reasonable time, Company must
provide field locations for all its underground facilities. The period of time will be
considered reasonable if it compares favorably with the average time required by the City
to locate municipal underground facilities for the Company.
92A.44. Before Company constructs any new structure or converts any existing
structure for the manufacture or storage of gas within the City, Company must first obtain
City approval of the structure and its location. City’s approval must not be unreasonably
withheld provided applicable zoning and other requirements are satisfied.
92A.50 - Relocation of Facilities
92A.51. Subdivision 1. Relocation of Gas Facilities in Public ways shall be subject
to Minnesota Rules, part 7819-3100 and any applicable City right-of-way ordinances
consistent with law.
Subd. 2. The City may require the Company at Company’s expense to relocate
or remove its gas Facilities from Public Grounds upon a finding that the Gas Facilities
have become or will become a substantial impairment to the existing or imminent public
use of the Grounds.
A. The City will issue a written Notice to the Company not less than 180
days in advance of a City project that may require the relocation of
Company’s gas Facilities.
B. Not more than 90 days from the date of the City’s Notice of a Project
requiring the relocation of Company’s gas Facilities, Company shall
provide to the City engineering plans, specifications and a schedule
for relocating the gas Facilities.
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C. Company’s engineering plans, specifications and a schedule will be
include in the City’s Project Plans and Specification Bid Documents
such that contractors bidding the City’s Project can base their bid on
Company’s representations as set forth in the Company’s plans,
specifications and schedule.
D. Upon completion of a City project, or as often as deemed necessary,
the City and Company shall meet to discuss project construction
related issues pertaining to the relocation of facilities in furtherance
of the goal of minimizing City project construction delays.
Subd. 3. If the City requests the Company to relocate its facilities or equipment
primarily for a non-public purpose or for the primary benefit of a commercial or private
project and such removal is necessary to prevent interference rather than merely for the
convenience of the City or other right-of-way user, the Company shall receive payment
from the commercial or private developer or other non-public entity for the cost of such
relocation as a precondition to relocating its facilities or equipment.
Subd. 4. City shall consider reasonable alternatives in designing its public works
projects so as not to arbitrarily cause the Company unreasonable additional expense in
exercising its authority under this Section.
Subd. 5. This Section does not compel a waiver by the Company, nor constitute a
taking by the City, of any written grant of easement to Company or any prescriptive rights
the Company has acquired by way of adverse possession independent of and without
reliance by the Company on this Franchise or any prior franchise adopted by City.
92A.52. Any relocation, removal or rearrangement of any Company facilities made
necessary because of the extension into or through City of a MnDOT federally aided state
trunk highway project shall be governed by the provisions of Minnesota Statutes Section
161.46.
92A.53. If a public right-of-way is vacated, improved or realigned because of a
renewal or redevelopment plan which is financially subsidized in whole or in part by the
Federal government, the reasonable nonbetterment costs of Company's relocation or
removal of its facilities shall not be the obligation of Company if such costs under then
prevailing law are the obligation of the Federal government or any agency thereof.
92A.54. This Chapter does not relieve any third party from liability arising out of
their failure to exercise reasonable care to avoid injuring Company's facilities while
performing any work connected with grading or changing of any public way or with any
construction on or adjacent to any public way. However, this section does not limit the
City’s right to indemnification under Section 92A.61.
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Article 92A.60 - Indemnification and Insurance
92A.61. Subdivision 1. Company must indemnify and hold the City harmless from
any and all claims, including reasonable attorneys’ fees, arising out of the Company’s
negligence, wrongful acts or omissions in connection with the Company’s operation under
this Franchise. The term “Company” includes the Company, its agents, servants,
independent contractors or employees. When a claim is made against the City, the City
shall promptly notify the Company of such suit so as to give the Company sufficient time
to appear on behalf of and defend the City.
Subd. 2. If Company elects to defend City, it will thereafter have complete control
of such litigation. However, the Company may not settle such litigation without the City’s
consent, which will not be unreasonably withheld.
Subd. 3. Company's obligation to indemnify the City shall not extend to any injury
to persons or property caused by the City’s negligence, wrongful acts or omissions.
Subd. 4. This section is not, as to third parties, a waiver of any defense or immunity
otherwise available to City. Company, in defending any action on behalf of City, is entitled
to assert in any action every defense or immunity that City could assert in its own behalf.
Subd. 5. Company's indemnification obligations shall survive the expiration,
amendment or termination of this Franchise.
92A.62. Upon request, Company must furnish City with a summary of insurance
coverage designed to fulfill the Company’s indemnification and hold harmless obligations
provided in Section 92A.61.
92A.63. Subdivision 1. In operating a public gas utility, the Company shall observe
all federal, state and local laws, rules, regulations and orders with respect to the
discharge, generation, removal, transportation, storage and handling of all materials,
substances and wastes deemed toxic or hazardous to health, natural resources or the
environment pursuant thereto ("Hazardous Substances").
Subd. 2. Company shall remove or remediate any Hazardous Substances (A)
located on, in or surrounding its gas distribution facilities; or (B) located on, in or
surrounding the public ways, public grounds or elsewhere within the City. Such removal
or remediation must comply with all applicable laws, regulations and lawful governmental
orders. Company must pay all costs associated the removal or remediation of Hazardous
Substances.
Subd. 3. Section 92A.61 applies to all claims made against City by any person
including any governmental agency and contractors hired by the City which asserts any
right to costs, damages or other relief based upon the terms and conditions imposed upon
Company under this Section or which arise from or are related to Company's negligence,
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wrongful acts or omissions in complying with any law, rule, regulation or lawful order
governing Hazardous Substances.
92A.70 - Vacation of Public Ways
92A.71. The City shall give the Company at least two weeks prior written notice of
a proposed vacation of a public right-of-way. Except where ordered pursuant to Section
92A.51, the vacation of any public right-of-way, after the installation of gas facilities, shall
not operate to deprive Company of its rights to operate and maintain such gas facilities,
until the reasonable cost of relocating the same and the loss and expense resulting from
such relocation are first paid to Company. In no case, however, shall City be liable to the
Company for failure to specifically preserve a right-of-way, in the exercise of its authority
under Minnesota Statutes, Section 160.29.
92A.80 - Reports and. Records
92A.81. Upon prior written request of the City, the Company shall file annually with
the City Administrator the Company’s certified annual financial statement showing the
Company’s capitalization, its profit and loss statements for the prior calendar year and its
balance sheet.
92A.90 - Rates and Service
92A.91. The MPUC regulates the Company’s provision of gas service and its rates
charged for gas service pursuant to Minnesota Statutes, Chapter 216B. City reserves the
right to regulate the rates and terms and conditions of Company's gas service within the
City to the full extent permitted by law if and to the extent that such regulation is not
preempted by the regulatory authority of the State of Minnesota or the Federal
government. The Company reserves the right to challenge any regulatory action
including the issue of the City’s authority to regulate rates and service. City and Company
reserve their respective rights generally and specifically granted pursuant to the laws of
Minnesota as adopted by the Legislature, the Constitution of the State of Minnesota, and
other law as interpreted by the Courts.
92A.92. In the event Company shall at any time after the Effective Date apply to
the MPUC to change its rates or terms and conditions of gas service, Company shall
provide reasonable advance notice of its application to the City. The notice must include
the Company's description of the proposal’s effect upon the City and the Company’s
customers located within the City. City may elect to intervene in Company's proceeding
before the MPUC or any other court or agency involving Company operations, for and on
behalf of City or customers located within City. City may petition the MPUC (or other state
agency) to order Company to reimburse City for its costs and fees incurred in said
proceedings. Company reserves the right to challenge such intervention or petition.
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92A.100 - Franchise Fee
92A.101. Subdivision 1. The laws of the State of Minnesota authorize a payment
of compensation to a city by the provider of natural gas services in the form of the
imposition of a city franchise fee to raise revenue or to defray costs accruing as a result
of such operations, or both. This payment is commonly referred to as a franchise fee.
Subd. 2. A franchise fee is not being imposed at this time as part of the adoption
of this ordinance. The Council, at its discretion, may at any time during the term of this
ordinance impose by resolution, after holding a public hearing, a franchise fee. The
franchise fee may be expressed (i) as a percentage of the Gross Revenue received by
the Company for its operations with the City, and/or (ii) as a volumetric price by therm,
and/or (iii) a flat fee, and/or (iv) in such other manner or fashion that is mutually acceptable
to both the City and Company and shall be applied in a manner that does not place the
Company at an economic disadvantage with another public utility as defined in Minnesota
Statutes, Chapter 216B.
Subd. 3. The Franchise Fee shall be adjusted for net write-off of uncollectible
accounts and corrections of bills theretofore rendered. The Company may list the local
franchise fee collected from customers as a separate item on bills for utility service issued
to customers.
Subd. 4. The franchise fee shall be effective upon adoption of the resolution
imposing the fee and shall continue until amended or repealed during the term of this
Ordinance. Initial and final payments shall be prorated for the portions of the periods at
the beginning and end of the term of this Ordinance.
92A.102. The Company must report and pay the franchise fee to the City on a
quarterly basis. Such payment shall be made not more than thirty days following the
close of the period for which payment is due. Company shall provide information by
customer class to City to show how fee was determined.
92A.103. The franchise fee rate shall be reviewed on January 1 of each year based
upon the Urban Consumer Price Index or any other relevant index. Any adjustment made
by the Council shall be reflected in a formal amendment to the Ordinance.
92A.104. If any person challenges the collection, any aspect of the franchise fee
or any other payment to be made to City pursuant to this Franchise, the Company must
promptly give notice to City and must, in any case, diligently and continuously exercise
its efforts to sustain said fee and payments and the time and manner of its collection. If
at any time the MPUC, or other authority having proper jurisdiction, prohibits such
recovery, then the Company will no longer be obligated to collect and pay the franchise
fee. The Company agrees to make its records related to the calculation and payment of
the franchise fee available for inspection by the City at reasonable times.
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92A.105. If for any reason the amount or rate of the franchise fee is determined to
be in excess of the amount or rate allowed by law, then the amount or rate shall
automatically, and without further action by City or Company, be reduced to the maximum
amount or rate permitted by law.
92A.106. At this time, the Company is subject to all applicable permit or licensing
fees. At such time that a franchise fee may be imposed by the Council, the franchise fee
will be in lieu of any other permit or licensing fee, charge or cost imposed on the Company
for providing gas service or performing work necessary to provide gas service. The City
cannot charge the Company any right-of-way fee imposed by a right-of-way ordinance
during this franchise term.
92A.110 - Successors and Assigns
92A.111. Company reserves the right to transfer or assign any interest in this
franchise, in accordance with the rules and regulations of the MPUC. All rights, privileges
and authority hereby granted to Company shall inure to the benefit of its successors and
assigns, subject to all the terms, provisions and conditions herein contained, and all
obligations hereby imposed upon Company shall be binding upon its successors and
assigns.
92A.120 - Confidential Information
92A.121 The Minnesota Government Data Practices Act (the Act) set forth in
Minnesota Statutes 13.01 et.seq., requires that the City provide public access to public
data as defined by the Act. The Company understands that public data may include
information relating to the Company and its operations that the Company would otherwise
prefer to keep confidential.
92A.122. The City will provide public access to public data relating to the Company
or its operations in compliance with and as provided by the Act, regulatory agency rule or
other law.
92A.123. At the time that it provides any data to the City, the Company will
specifically identify data that it claims to be private, protected, non-public, or confidential,
or that is otherwise precluded from public disclosure by the Act, regulatory agency rule,
or other law. At such time, the Company will also identify the provisions of the Act,
regulatory agency rule or other law that preclude public disclosure of such data.
92A.124. As provided by Minnesota Statutes, Section 13.072, the Company may
request an advisory opinion from the Commissioner of the Minnesota Department of
Administration regarding the classification of Government Data relating to the Company.
The City will abide by such an advisory opinion of the Commissioner, except as otherwise
required or provided by law, regulatory agency rule, or court decision or other advisory
opinion of the Commissioner.
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92A.130 - Effective Date and Acceptance
92A.131. The Franchise shall be effective as of April 1, 2015 May 1, 2025.
92A.140 - Disclosure
92A.141. Upon the City’s written request, Company shall file a report with the City
if Company makes contributions or expenditures, other than usual civic, charitable
contribution, and normal authorized business expenses in an aggregate amount in excess
of $10,000 in any calendar year as for the purpose of directly influencing any resident or
elected or appointed official of the city with respect to the Franchise or the subject matter
thereof. However, the Company shall not be required to disclose contributions or
expenditures related to actual or anticipated action of the City, its residents, elected or
appointed officials, or any other party promoting, encouraging, or advancing municipal
takeover (i.e. condemnation) of Company’s property located in and around the City. The
City may not limit or restrict Company’s contributions or expenditures in any manner not
permitted by state or federal law.
92A.150 - Defaults
92A.151. If Company shall be in default in the performance of any of the material
terms and conditions of this Ordinance, and shall continue in default for more than 30
days (or fails to initiate the cure of the default within said period and diligently pursue said
cure, if the cure of the default cannot reasonably be accomplished within said 30 days
after receiving notice from the City of such default), the City may, following a public
hearing thereon, elect to either cure such default and charge Company for the costs
thereof, or seek equitable relief for the enforcement of this Ordinance. The notice of
default must be in writing, must specify the provisions of this Ordinance and the
performance of which it is claimed that Company is in default and the date of the public
hearing required to be held. The public hearing must not less than 30 days nor more than
60 days from the date of such notice. Such notice shall be served in the manner provided
by the laws of Minnesota for the service of original notices in civil actions. Company at
such hearing shall be afforded an opportunity to present whatever information it deems
appropriate. Nothing herein shall in any way be construed, to prevent a review of such
City action by the appropriate Minnesota Court and/or regulatory agency, nor limit the
right of City to enforce this Ordinance by such equitable or legal remedies as may be
provided by law. In the event of repeated or protracted violations of this Ordinance
involving payments due to City, City may require Company to file a bond or letter of credit
with the City Administrator, against which City may draw to assure prompt payment of
amounts due by Company to City under this Ordinance.
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92A.160 - Force Majeure
92A.161. It shall not be a breach or default under this franchise if either party fails
to perform its obligations hereunder due to Force Majeure. Force Majeure shall include,
but not be limited to, the following: A) physical events such as acts of God, landslides,
lightning, earthquakes, fires, freezing, storms, floods, washouts, explosions, breakage or
accident or necessity of repairs to machinery, equipment or distribution or transmission
lines; B) acts of others such as strikes, work-force stoppages, riots, sabotage,
insurrections or wars; or C) governmental actions such as necessity for compliance with
any court order, law, statute, ordinance, executive order, or regulation promulgated by a
governmental authority having jurisdiction; and any other causes, whether of the kind
herein enumerated or otherwise not reasonably within the control of the affected party to
prevent or overcome. Each party shall make reasonable efforts to avoid Force Majeure
and to resolve such event as promptly as reasonably possible once it occurs in order to
resume performance. However, this provision shall not obligate a party to settle a labor
strike.
92A.170 - Construction, Jurisdiction and Venue
92A.171. This Franchise is intended to be performed in the State of Minnesota and
shall be construed and enforced in accordance with the laws of Minnesota. Company
shall be subject to personal jurisdiction in the State of Minnesota. Any action related to
this Ordinance or its enforcement must be venued in Olmsted County or such other
judicial district as may include the City if the judicial districts of the State of Minnesota be
revised after the Effective Date. This Ordinance and its acceptance by Company shall be
construed as a contract between Company and City. The provisions of this Ordinance
shall be enforceable only by Company and City and not by any third party. A third party
does not have a claim to any cause of action against Company by reason of the adoption
of this Ordinance.
92A.180 – Miscellaneous Provisions
92A.181. If any clause, sentence or section of this Ordinance is deemed invalid,
the remaining provisions shall remain in effect.
92A.182. Any waiver of any obligation or default under this Ordinance shall not be
construed as a waiver of any future defaults, whether of like or different character.
92A.183. All ordinances or franchises or parts of ordinances or franchises in
conflict herewith are hereby repealed.
92A.184. The City and Company agree that this Franchise may be subject to
renegotiation under the following circumstances:
1. Upon mutual agreement of both parties.
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2. Upon the enactment of any state of federal law, regulation, or order materially
affecting the rights or obligations under this Franchise.
3. If a material change occurs in the economic, regulatory, or operational
conditions impacting the Company’s ability to provide services or the City’s
ability to enforce it’s rights under this Ordinance.
4. Either party may initiate renegotiation by providing written notice specifying the
provisions to be reviewed. The responding party shall acknowledge receipt of
the notice within 10 days. If an agreement is not reached within 90 days of the
acknowledgment, either party may seek mediation or other legal remedies
available under Minnesota law. If the parties cannot reach a mutually
agreeable modifications, the existing terms of the agreement shall remain in
effect unless otherwise stipulated.
Section 2. This ordinance shall be effective upon the date of its publication.
PASSED AND ADOPTED BY THE COMMON COUNCIL OF THE CITY OF
ROCHESTER, MINNESOTA, THIS _____ DAY OF _____________, 2025.
____________________________________
PRESIDENT OF SAID COMMON COUNCIL
ATTEST: __________________________
CITY CLERK
APPROVED THIS _____ DAY OF ______________________, 2025.
___________________________________
MAYOR OF SAID CITY
(Seal of the City of
Rochester, Minnesota)
Ord25/ 92A.update
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