Appendix 2: Annexation Agreement

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Airdrie / Rocky View Annexation Application September 2011

APPENDIX2:

ANNEXATION AGREEMENT


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Airdrie / Rocky View Annexation Agreement Page 1 of 28

September 2011

ANNEXATION AGREEMENT

This Agreement made as of the 9th day of September, A.D. 2011

BETWEEN:

ROCKY VIEW COUNTY

A Municipal Corporation in the Province of Alberta

(Referred to as Rocky View)

And OF THE FIRST PART

CITY OF AIRDRIE

A Municipal Corporation in the Province of Alberta

(Referred to as Airdrie)

OF THE SECOND PART

WHEREAS Airdrie intends to apply to the Municipal Government Board for Annexation to Airdrieof the lands located in Rocky View, described in Schedule A and depicted in Schedule B (theAnnexation Territory);

AND WHEREASAirdries position is the Annexation is necessary and appropriate for an estimated50 year land supply for residential, recreational, public utility, industrial, commercial andinstitutional uses to enable Airdrie to properly regulate and control its future growth anddevelopment on a comprehensive and long term basis;

AND WHEREAS Airdrie and Rocky View entered into a negotiation process with regard toAnnexation to ensure that the interests of both municipalities and the public are addressed;

AND WHEREASRocky View and Airdrie have jointly reviewed and discussed Airdries Annexationproposal and jointly agreed to the proposal and other related matters in accordance with thatauthority vested in them, pursuant to the provisions of the Municipal Government Act, R.S.A. 2000Chapter M-26, as amended;

AND WHEREAS Rocky View and Airdrie engaged in a substantive public consultation process,including a number of open houses and a public hearing held by Airdrie Council on May 2, 2011 andby Rocky View Council on May 10 and 17, 2011;

AND WHEREAS the product of this negotiation process is this comprehensive Agreement thataddresses the interests of both municipalities and the public;

NOW THEREFORE in consideration of the mutual covenants and promises contained herein andfor other good and valuable consideration, the sufficiency and receipt of which are herebyacknowledged, Airdrie and Rocky View agree as follows:


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PART 1 - DEFINITIONS

1.1 Act means the Municipal Government Act, R.S.A, 2000, Chapter M-26, and amendmentsthereto;

1.2 Annexation means the incorporation of the Annexation Territory within the boundaries ofAirdrie;

1.3 Annexation Order means the Order in Council issued by the Lieutenant Governor-in-Council authorizing the Annexation pursuant to Section 125 of the Act;

1.4 Annexation Territory means the lands legally described in Schedule A and shown in themap attached as Schedule B to this Agreement;

1.5 Application means Airdries application for annexation of the Annexation Territory, inaccordance with the Act;

1.6 Effective Date of Annexation means December 31, 2011 or such other date, with apreference for December 31st of any given year, as may ultimately by determined by order

of the Lieutenant Governor-in-Council.;

1.7 Farmstead means a habitable residence located on a parcel of land that is the equivalent ofa quarter-section in area that contains a farming operation for the raising or production ofcrops or livestock, and other improvements used in connection therewith, where thehabitable residence has existed on the parcel for a minimum of ten (10) years;

1.8 Farm Property Means:(a) a Farmstead;(b) the parcels of land following the separation of a Farmstead to create a Farmstead

title;

(c) a parcel of land used for the raising or production of crops or livestock subject tothe restriction of the Rocky View Land Use Bylaw and Provincial Regulations.

1.9 Municipal Government Board or Board means the Municipal Government Boardestablished under Part 12 of the Act, and includes any panel of the Board;

1.10 Reserve lands means those lands within the Annexation Territory which are designatedenvironmental reserve, municipal reserve, school reserve or municipal and school reserve,and public utility lots, as defined and referred to in the Act, all as described and depicted onSchedule C;

1.11 Triggering Event means the occurrence of any of the following on or after the EffectiveDate of Annexation either at the request of or on behalf of the landowner:(a) A re-designation application is approved by Airdrie Council pursuant to Airdries

Land Use Bylaw in effect at the time for re-designation of the parcel to a land usedistrict other than agricultural or urban reserve (or its equivalent), or other than aspermitted by a land use designation in effect at the time of annexation pursuant toAirdries Land Use Bylaw in effect at the time;


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(b) When any parcel of land and improvements is subject to a local improvement bylawfor a local improvement project which results in the connection of the parcel of landand improvement to Airdrie water or sanitary sewer servicing;

(c) Any parcel of land and improvements is otherwise directly connected to Airdriessewer or water services; or

(d) The parcel of land is the subject of a subdivision or separation of title (whether byregistered plan of subdivision, by instrument or any other method), whereby a newparcel of land (including the residual parcel) is created.

1.12 Airdrie Airpark means the lands contained within the W 36-26-29 W4M and E 35-26-29 W4M and currently being used as a private Airport facility.

PART 2 - MUTUAL COOPERATION

2.1 Airdrie and Rocky View agree to use all reasonable efforts to fully cooperate with oneanother to ensure that the terms and conditions of the Agreement are fulfilled including,without limitation, the Annexation Territory boundaries established in this Agreement.

2.2 Rocky View shall provide to Airdrie without cost or charge to Airdrie:(a) all information required by Airdrie with respect to the Annexation Territory for

submission to the Board or to other government department, as required under theAct;

(b) written confirmation to the Board that Rocky View is not opposing the annexation;and

(c) any further assistance that Airdrie may reasonably request in order to supportapproval of the Annexation by the Lieutenant Governor-in-Council.

2.3 Rocky View shall provide, without cost or charge, all information requested by Airdrie withrespect to the Annexation Territory to facilitate the orderly and efficient transfer ofjurisdiction and administration of the Annexation Territory within thirty (30) daysfollowing the Effective Date of Annexation.

2.4 The information referred to in sub-section 2.3 is detailed in Schedule D and includes, butis not limited to all information relating to assessment and taxation bylaws, policies,procedures and valuations in effect from time to time in Rocky View before and afterAnnexation, in the event that all or part of the Annexation Territory is subject to conditionsgoverning assessment and taxation.

2.5 Airdrie specifically acknowledges and agrees that any information provided to it by RockyView pursuant to the terms of this Agreement will be used solely for the purpose set out inthis Agreementand the proper administration of Airdries bylaws, statutory plans andpolicies.

2.6 Airdrie shall provide, without cost or charge, all information requested by Rocky View withrespect to the Annexation of the Annexation Territory for submission to the Board or othergovernment departments.


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2.7 The parties shall provide each other, without cost or charge, any further assistance that maybe reasonably requested, including an appearance before the Board for the purposes ofconfirming the terms, covenants and conditions contained within this Agreement to ensurea recommendation of full approval of the Annexation by the Board and full approval of theAnnexation by the Lieutenant Governor in Council.

2.8 Rocky View and Airdrie acknowledge and agree that in the event that Lieutenant Governorin Council affects, alters, amends or in any way impacts the terms of this Agreement, thisAgreement will continue to govern, however, both parties shall, in good faith, enter intorenewed negotiations with respect to the implementation of the Agreement to the extentthat it is impacted by and implementation is not addressed by the Order of the LieutenantGovernor in Council.

PART 3 - TAXATION AND ASSESSMENT

3.1 As of the Effective Date, Airdrie shall assume responsibility for the assessment and taxationof all lands and improvements within the Annexation Territory and shall assess and taxsuch lands and improvements in accordance with the provisions of the Act and the

regulations passed thereunder.

3.2 Farm Property within the Annexation Territory will continue to be exempt from taxation tothe extent that and for so long as such exemption is prescribed under the MunicipalGovernment Act. At such time that such exemption is not provided under the MunicipalGovernment Act, Farm Property will be subject to the same rate as other land andimprovements within Airdrie.

3.3 In the event that a parcel of land or improvement within the Annexation Territory besubject to tax recovery proceedings with respect to any arrears of taxes or utilities, or besubject to any encumbrances for unpaid taxes or utilities or other municipal liens orcharges, Airdrie and Rocky View shall do all such further acts and execute and deliver allsuch further deeds and documents as shall be required to effect the collection, recovery andpayments of such taxes and utilities to the party entitled to same.

3.4 Any arrears in taxes or utilities owing to Rocky View as at the Effective Date with respect toany parcels of land or improvements within the Annexation Territory shall transfer to andbecome payable to Airdrie together with any lawful penalties or costs levied in respect ofsuch arrears. Upon Airdrie collecting such arrears, the recoveries shall, at the end of eachtaxation year, be paid to Rocky View.

3.5 Rocky View shall provide Airdrie with a list of all parcels of land and improvements withinthe Annexation Territory which have outstanding tax or utility arrears at the Effective Date.

3.6 To minimize the taxation impacts on existing Rocky View residents located within theAnnexation Territory, Rocky View and Airdrie have agreed to a number of assessment andtaxation conditions as follows:

(a) Lands and improvements within the Annexation Territory, excluding FarmProperty, will be assessed by Airdrie on a market value basis but will be taxed for aperiod of twenty (20) years at the Rocky View mill rate for a given year until theearlier of

(i) the occurrence of a Triggering Event; or


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(ii) December 31 of the calendar year following twenty (20) full years from theearliest date specified in the Annexation Order on which the Annexation is tobe effective for assessment and taxation purposes, when such date is afterDecember 31, 2011;

at which time the lands and improvements in question will be subject to taxation

at the same rate as other land and improvements within Airdrie.

(b) Farm Property within the Annexation Territory will continue to be assessed basedon regulated rates established by the Province of Alberta at the Rocky View mill ratefor a period of thirty (30) years from the Effective Date of Annexation to the extentthat and for so long as such regulations are prescribed for Countys under the Act. Atthe expiry of the thirty (30) year period or at such time that such exemption is notprovided under the Act, or in the event of a Triggering Event, the Farm Property willbe subject to taxation at the same rate as other land and improvements withinAirdrie.

3.7 Subject to sub-section 3.8 the education taxes attributed to lands within the AnnexationTerritory will be paid in full by Airdrie for a period of one (1) year from the Effective Date ofAnnexation.

3.8 If the Effective Date of Annexation is not December 31 of a given year Airdrie will pay 100percent of the education taxes attributed to lands within the Annexation Territory for aperiod of two (2) years.

3.9 Airdrie and Rocky View will coordinate the payment of education taxes to the Province ofAlberta through the use of over/under levies, which will result in a reduction in payment ofeducation taxes from Rocky View and an equal increase in payment of education taxes fromAirdrie for the affected period prescribed in sub-section 3.7 and 3.8.

PART 4 - PLANNING AND DEVELOPMENT TRANSITION

4.1 As of the Effective Date, Airdrie will be the Development Authority and SubdivisionAuthority, as contemplated by the Act, for the Annexation Territory.

4.2 Land uses, including Direct Control Bylaws, within the Annexation Territory will continue tobe governed by Rocky Views Land Use Bylaw in place as at the Effective Date of Annexationuntil such time as Airdrie Council re-designates the land use of such lands.

4.3 In the event that Airdrie Council re-designates lands within the Annexation Territory, anyland uses which were existing and legal under Rocky Views Land use Bylaw as of the

Effective Date of Annexation will be considered as a lawful non-conforming use pursuantto Section 643 of the Act and will be subject to the restrictions set forth in Section 643 of the

Act, unless the Lands are re-designated under Airdries Land Use Bylaw to provide for theuse as a permitted or discretionary use.

4.4 Any approved Rocky View Area Structure Plans and Conceptual Schemes within theAnnexation Territory will no longer apply within the Annexation Territory as of theEffective Date of Annexation.


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4.5 Upon the Effective Date of Annexation, Rocky View will transfer all subdivision, planningand development applications in process for the Annexation Territory to Airdrie with 50%of the fees collected for all such applications.

4.6 Upon issuance of the Annexation Order, all businesses operating in the AnnexationTerritory will be required to obtain an Airdrie Business License by January 30 following the

Effective Date of Annexation or within ninety (90) days of the Effective Date of Annexationor the release of the Annexation Order, whichever is longer.

4.7 Existing legal home-based businesses in the Annexation Territory will be required to obtaina Home Based Business Permit from Airdrie immediately upon the expiration of the existingRocky View development permit.

4.8 As of the Effective Date, Airdrie shall assume the rights and obligations of Rocky Viewpursuant to any agreement entered into between Rocky View and land owners ordevelopers with respect to lands located within the Annexation Territory and will inter alia,subject to compliance with all conditions of subdivision approval required to be met priorto registration of the plan of subdivision, consent to the registration of plans of subdivision

and other similar instruments at the Land Titles Office with respect to subdivisionsapproved by Rocky View prior to the Effective Date.

4.9 As of the Effective Date, Airdrie shall assume the rights and obligations of Rocky View withrespect to development approvals and permits and building permits issued by Rocky Viewwith respect to lands located in the Annexation Territory. With respect to developmentapprovals given by Rocky View prior to the Effective Date, Airdrie will, subject tocompliance with all conditions of the development approval, inter alia, consent to theissuance of development permits.

4.10 Any development or subdivision applications which are pending as at the Effective Date ofAnnexation will be managed as follows:

(a) on the Effective Date of Annexation, all existing development and subdivision filesrespecting lands located within the Annexation Territory shall be transferred toAirdrie for administration,

(b) development and subdivision applications will be evaluated by Airdrie on the basisof the existing Rocky View Land Use Bylaw until such time as Airdrie adoptscomparable regulations in the Airdrie Land Use Bylaw. However, Airdrie willadminister circulations, timing and approval process pursuant to Airdries

established administrative process subject to the following:

(i) if Rocky View has accepted an application as complete (including requiredsupport studies) as at the Effective Date of Annexation, Airdrie will

complete the file on the basis of the Rocky View process without adding toor lengthening the approval process, or

(ii) If the file is at the pre-circulation stage, the full Airdrie circulation processwill apply.


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PART 5 - ROADWAYS

5.1 As depicted in Schedule G, all boundary roads within the Annexation Territory that areowned and maintained by Rocky View County will transferred to the City of Airdrie uponthe effective date of annexation.

5.2 As at the Effective Date of Annexation, Airdrie shall maintain all public roadways containedwithin the Annexation Territory to conditions comparable or better than the current roadconditions, as such roads are depicted in Schedule G, and maintenance standards definedin Schedule I.

5.3 Airdrie and Rocky View may enter into a road maintenance agreement whereby Rocky Viewcontinues to maintain such roadways for a prescribed period of time.

5.4 Airdrie and Rocky View may enter into a shared maintenance agreement for themaintenance of a one mile portion of Range Road 292 as depicted in Schedule H for 2011.

5.5 The costs associated with a maintenance agreement referenced in Section 5.4 will bedetermined by a competitive tender process that is jointly administered by Rocky View and

Airdrie and all related tender process costs shall be shared evenly between Rocky View andAirdrie.

5.6 In 2012, regardless of the Effective date of Annexation, Airdrie and Rocky View may enterinto a shared agreement for the upgrade of Range Road 292 to a Rocky View pavedstandard as Range Road 292 is depicted in Schedule H. With respect to the upgrade ofRange Road 292, Rocky View will be responsible for the costs of the upgrade for three (3)miles from Highway 566 north to Township Road 265 and Airdrie will be responsible forthe costs of the upgrade for one (1) mile from Township Road 265 north to Yankee ValleyBoulevard.

PART 6 - ROCKY VIEW OWNED LANDS

6.1 Subject to Section 6.3, Rocky View confirms that it has not sold nor shall it sell to any otherparty any Reserve lands contained within the Annexation Territory that are owned byRocky View as of the Effective Date of Annexation, as such lands are described in ScheduleC.

6.2 Subject to Section 6.3, within 90 days of the Effective Date of Annexation, Rocky View shalltransfer all Reserve Lands and all interests held by Rocky View in any lands located withinthe Annexation Territory that are held in lieu of Reserve Lands (including, but not limited todeferred reserve caveats) shall be transferred to Airdrie at no cost to Rocky View.

6.3 As at the anticipated Effective Date of Annexation, Rocky View will hold title to a lot locatedin the City of Airdrie identified as the easterly 240 feet of the northerly 544.5 feet of the NE of W4M-29-26-33, as described in Schedule F, which currently functions as the RockyView Public Works Shop. Rocky View will maintain title to this lot after the Effective Date ofAnnexation.

6.4 Upon transfer of the Reserve Lands to Airdrie, Airdrie shall ensure that any and all ReserveLands will be continued to be maintained at least to the Rocky View standards in place as atthe Effective Date of Annexation, as defined in Schedule J, until such Reserve lands areincorporated into an Area Structure Plan approved by Airdrie Council.


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PART 7 - WATER, WASTEWATER AND SOLID WASTE SERVICES

7.1 Following the Effective Date of Annexation, Airdrie solid waste collection, and municipalwater and wastewater utility services will not be immediately provided for properties in theAnnexation Territory.

7.2 Airdrie will determine the appropriate timing for the extension of services listed in Section7.1 through its long term planning processes and will engage affected residents andlandowners through these processes.

7.3 Existing private water and wastewater servicing systems on lands within the AnnexationTerritory shall be permitted to continue until such time as the lands are connected or arerequired to be connected to Airdrie water and/or wastewater utility services throughapprovals for urban use development or subdivision approvals.

7.4 Airdrie is under no obligation to provide and/or fund municipal water and/or wastewaterutility services to lands within the Annexation Territory. All construction, extension and/orupgrading of municipal infrastructure to lands within the Annexation Territory will beevaluated and prioritized by Airdrie within the context of the Airdrie MunicipalDevelopment Plan and/or Area Structure Plans in place at the time.

7.5 All costs associated with the provision of water and/or wastewater service infrastructurerequired to bring services to lands within the Annexation Territory may be recovered byAirdrie from the developers or owners of the subject lands by means including but notlimited to the imposition of off-site levies in accordance with the Act.

PART 8 - COMPENSATION

8.1 Within ninety (90) days of the Effective Date of Annexation, Airdrie shall pay to Rocky View$1,634,837.90 which is the estimated cost of improvements made by Rocky View to roads inthe Annexation Territory from June 1, 2006 to June 1, 2011, adjusted for the depreciation

based on the estimated life cycle of the improvement.

8.2 Within thirty (30) days of the Effective Date of Annexation, Rocky View shall transfer theobligations of the Rocky View Range Road 13 Debenture Borrowing Bylaw C-7049-2011 toAirdrie and Airdrie shall accept such transfer.

8.3 If any boundary adjustments are made to the Annexation Territory, or changes are made tothe Effective date of Annexation by the Order in Council by the Lieutenant Governor, theCompensation payable pursuant to Section 8.1 shall be recalculated based on the formulaset out in Schedule E.

PART 9 - AGRICULTURE

9.1 Airdrie shall use all reasonable efforts to ensure that lands within the Annexation Territorycontinue to be available for agricultural purposes until they are required for urbandevelopment.

9.2 Airdrie shall use all reasonable efforts to ensure that current agricultural operations andoperating methods are not unduly affected as a result of the Annexation.


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9.3 Airdrie may contract with the Rocky view Agricultural Services Board to perform servicesnormally provided by the Agricultural Services Board within Rocky View (e.g. weedmanagement, disease and pest control and consultation) for existing farming operationswithin the Annexation Territory.

PART 10 - FUTURE LONG RANGE PLANNING

(NOT TO BE INCLUDED IN THE ANNEXATION ORDER)

10.1 This Section is included for the purposes of background information only and is notintended to be included in the Annexation Order.

10.2 Subsequent to the release ofthe Provinces decision on the proposed Annexation, RockyView and Airdrie may commence the joint preparation of a new Airdrie/Rocky View Inter-municipal Development Plan (IDP), which will include lands in both jurisdictions.

10.3 Rocky View and Airdrie will use all reasonable efforts to finalize the Inter-municipalDevelopment Plan (IDP) preparation and present the proposed IDP to the respectivemunicipal Councils within two (2) years from date upon which the Provincial decision onthe Annexation is released. The parties may alter this time frame through mutualagreement.

10.4 The IDP process will include a public consultation process. The IDP will address but not belimited to the following issues and opportunities for inter-municipal cooperation:

(a) Compatible Development and Land Use Transition;(b) Agricultural Areas;(c) Residential Areas;(d) Airport and Vicinity Area (including Airdrie Airpark);(e) Commercial, Industrial and Institutional Uses;(f) Environment ally and Economically Sensitive Areas (including Nose Creek

Watershed Management);

(g) Transportation, Utilities, Servicing and Storm-water management;(h) Circulation and Referral Processes;(i) Administration and Repeal and Amendment Process;(j) Dispute Resolution;(k) Future Growth Management; and(l) Future Targeted and Strategic Annexation.

10.5 Subsequent to the Annexation Order being issued, Airdrie will commence the process toamend its Municipal Development Plan (MDP) to include the Annexation Territory.


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10.6 The Airdrie MDP amendment will be undertaken with public consultation of future Airdrieresidents and businesses, and will identify the boundaries and appropriate policies relatingto existing country residential communities of Hamilton Greens, Croxford Estates, BuffaloRub and Yankee Valley Estates in the Annexation Territory.

PART 11 - NOTICES

11.1 Any notice required to be given under this Agreement shall be given in writing anddelivered to:

(a) in the case of Airdrie, to its Chief Administrative Officer at:City of Airdrie400 Main Street SE Airdrie, AB T4B 3C3Fax: 403 948-6567

(b) in the case of Rocky View, to its County Manager at:Rocky View County

911 32 Avenue NE Calgary, AB T2E 6X6Fax: 403-230-0299

PART 12 - GENERAL PROVISIONS

12.1 All references to legislation contained herein, including without any limitation anyreferences to statutes, regulations or bylaws, shall include amendments thereto, and anylegislation inpari materia therewith, and any successor legislation enacted in replacementthereof.

12.2 Each of the parties hereto shall at all times undertake all such further acts and execute anddeliver all such further documents as shall be reasonably required to fully perform the

terms and conditions of this Agreement.12.3 The headings and paragraph numbers contained in the Agreement are for convenience and

reference only and in no way define or limit the scope or intent of this Agreement or anyprovision thereof.

12.4 This Agreement constitutes the entire Agreement of the parties hereto with respect to thesubject matter hereof, and this Agreement shall not be amended, modified or dischargedexcept by an instrument in writing executed under the authority of each of the partieshereto.

12.5 No waiver by or on behalf of either party hereto of any breach of the covenants orconditions herein contained shall take effect or be binding upon that party unless the same

be expressed in writing under the authority of that party and any waiver so given shallextend only to the particular breach so waived and shall not limit or affect any rights withrespect to any other breach.

12.6 The Recitals and Schedules attached hereto form part of this Agreement.12.7 Nothing in this Agreement shall be construed as fettering or restricting the lawful authority

of any board, tribunal, other quasi-judicial entity, or elected municipal Council (or memberthereof), in the exercise of jurisdiction vested in the by law.


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12.8 This Agreement is binding upon both Rocky View and Airdrie and their successors andassigns.

12.9 If any provision of this Agreement is found to be illegal or unenforceable by a court ofcompetent jurisdiction, the remainder of this Agreement shall remain in full force and effect.

PART 13 - DISPUTE RESOLUTION

13.1 This Part does not apply to Paragraph 2.8.13.2 Where Rocky View and Airdrie cannot agree on the interpretation, application or operation

of certain provisions of this Agreement, or cannot come to an agreement on matters set outin this Agreement requiring agreement, the parties agree to first engage in conciliatorydiscussions and negotiations (as outlined below) to resolve, failing which the parties agreeto submit such issues to mediation (as outlined below) before a single mediator agreed toby both parties, the cost of which shall be borne equally between the parties. If the partiescannot agree on a single mediator, then either party may upon 10 days notice to the otherapply to the Alberta Department of Municipal Affairs to appoint the mediator from its inter-municipal dispute resolution roster.

13.3 Once a disagreement has been identified, conciliatory discussions must commence withinthirty (30) calendar days of the identification of the issue.

13.4 In the event that the issue is not resolved within three (3) months of the commencement ofconciliatory discussions, the issue shall proceed to mediation for a maximum of three (3)months, unless a mutual agreement to extend such deadline is reached between the parties.

13.5 Notwithstanding Section 13.3, the parties may proceed to mediation for a maximum of six(6) months prior to the expiry of the thirty (30) calendar days referred to in Section 13.3following the completion of at least one (1) conciliatory meeting, unless a mutual agreementto extend such deadline is reached between the parties.

13.6 Where the parties are unable to resolve the disagreement through the dispute resolutionmechanisms and within the time periods specified in this Part, Rocky View and Airdrie shallsubmit such issues to binding arbitration with respect to matters arising from theimplementation of conditions of the Annexation Order as contemplated in Part 16 and tonon-binding arbitration with respect to all other matters pursuant to theArbitration Act,R.S.A 2000, Chapter A-43 as amended within thirty (30) days of the conclusion of themediation, which shall proceed as stipulated herein.

13.7 Prior to referring a matter to arbitration:(a) the party intending to so refer shall notify the other in writing of the details, nature

and extent of the dispute; and

(b) within fourteen (14) days of receipt of such notice, the responding party shall advisethe first of the action it is prepared to take to resolve the dispute.


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13.8 If the first party does not accept the proposed resolution within fourteen (14) days ofreceipt of the proposal, then the parties shall refer the dispute to arbitration before a panelof 3 (three) arbitrators appointed in the following manner:

(a) each party shall appoint an arbitrator and upon doing so shall forthwith give noticein writing thereof to the other party;

(b) if each party fails to appoint an arbitrator within seven (7) days of receiving a noticeof appointment from the other party as required under Section 13.8(a), the otherparty may apply to a Justice of the Court of Queens Bench of Alberta to appoint anarbitrator on behalf of and at the expense of the party in default;

(c) the arbitrators appointed by or for the parties hereto shall appoint a third arbitratorand, if they fail to do so within fourteen (14) days after the last of them wasappointed, either party on notice to the other party may apply to a Justice of theCourt of Queens Bench of Alberta to appoint a third arbitrator;

(d) the appointment of all arbitrators, except those appointed by a Justice as hereinprovided, shall be in writing;

(e) the arbitrators shall have the power to obtain the assistance, advice or opinion ofsuch engineer, architect, surveyor, appraiser, values or other expert as they maythink fit and shall have the discretion to act upon any assistance, advise or opinionso obtained; and

(f) costs associated with an Arbitration will be determined at the discretion of theArbitrator based on the merits and issues associated with said Arbitration.

13.9 The decision of the majority of the Arbitration Committee shall be the decision of theArbitration Committee and shall be subject to the ratification and adoption by therespective Councils of Rocky View and Airdrie.

13.10 Each of the parties shall do all acts and things and execute all deeds and instrumentsnecessary to give effect to any resolution reached under this Part.

13.11 Except as modified herein, the provisions of theArbitration Act, R.S.A 2000, Chapter A-43as amended shall apply.

PART 14 - EFFECTIVE DATE OF ANNEXATION

14.1 Airdrie and Rocky View request that the Annexation shall be effective as of December 31,2011.

14.2 The reason for Section 14.1 is to minimize the impacts associated with education taxpayments to one year as opposed to two years for Airdrie and Rocky View.

14.3 Airdrie and Rocky View further request that in the event that the Board is consideringaltering the Effective Date of Annexation, that both parties be consulted as part of thisprocess.


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PART 15 - TERMINATION

15.1 This Agreement shall terminate and be of no force and effect upon the occurrence of any ofthe following events, whichever shall first occur:

(a) Airdries withdrawal of its application to the Board for Annexation of theAnnexation Territory; or

(b) Refusal of Airdries application to annex the Annexation Territory by the LieutenantGovernor in Council.

PART 16 - RECOMMENDATIONS TO THE MUNICIPAL GOVERNMENT BOARD

16.1 In furtherance of attaining the objectives contained within this Agreement, bothmunicipalities agree to request the Board to recommend and the Lieutenant Governor inCouncil to include all matters contained in this Agreement, with the exception of Part 10,within the Annexation Order, and specifically impose the following specific conditionswithin the Annexation Order:

(a) Upon the Effective Date of Annexation, Rocky View shall transfer those lands withinthe Annexation Territory to Airdrie as specified with this Agreement;

(b) Compensation shall be payable from Airdrie to Rocky View as specified in Part 8herein; and

(c) Lands within the Annexation Territory and improvements thereon shall be taxed byAirdrie on the same basis as if they had remained within Rocky View in accordancewith Part 3 herein.


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signed by:Wendy Kelly

signed by:Rolly Ashdown

signed by:Sharon Pollyck

signed by:Peter Brown


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SCHEDULE A

Legal Description of the Annexation Territory

1.1 The lands included within the Annexation Territory as shown in Schedule B, are describedAs follows:

(a) Township 26, Range 29, West of the 4th Meridian(i) All of Section 36;(ii) The West half of Section 35; and(iii) The East half of Section 34.

(b) Township 26, Range 1, West of the 5th Meridian(i) All of Sections 27 and 34; and(ii) The South half of Section 26.

(c) Township 27, Range 28, West of the 4th Meridian(i) The West half of Section 7; and(ii) The SW of Section 18.

(d) Township 27, Range 29, West of the 4th Meridian(i) All of Sections 1, 12 and 23;(ii) The East half of Section 2,11 and 22;(iii) The West half of Section 6 and 24;(iv) The North half of Section 14;(v) The South half of Section 13;(vi) The NE of Section 15;(vii) The NW of Section 13; and(viii) The SE of Section 14.

(e) Township 27, Range 1, West of the 5th Meridian(i) All of Sections 3, 10, 15, 22, 23 and 24;(ii) The North half of Section 13 and 14; and(iii) The NE of Section 9.


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SCHEDULE B

Annexation Territory


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SCHEDULE C

Reserve Lands


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SCHEDULE D

Assessment and Taxation Records

PART 1 - ASSESSMENT RECORDS

1.1

The assessment roll for the Annexation Territory showing all detail required pursuant toSections 303 and 304 of the Municipal Government Act.

1.2 The property record for all properties taxable and exempt within the Annexation Territory.1.3 Assessment files relating the annexed parcels.1.4 Decisions of the assessment tribunals that specifically apply to annexed parcels.1.5 Farm income data for annexed parcels that qualify as farmland.1.6 Details of any exemptions granted under the Municipal Government Actand the former

Municipal Taxation Actto the annexed parcels.

1.7 Copes of any Bylaws, Order of Acts granting an exemption under the MunicipalGovernment Act, the former Municipal Taxation Exemption Actor private Acts thatspecifically apply to annexed parcels.

1.8 Explanation of any codes used in the assessment roll or on the property record cards andother similar information.

1.9 Maps of the annexed area showing legal and parcel plan boundaries used for assessmentpurposes.

1.10 All procedures and policies used for the current general assessment.1.11

Details of market data relied on for the current general assessment.

1.12 Details of any ongoing rebates of taxes under the Municipal Government Act.1.13 Details of any assessment performed by the Chief Provincial Assessor.1.14 Details of any machinery and equipment assessments.1.15 The most recent Supplementary Assessment bylaw.1.16 The current classification bylaw if not included in the property tax bylaw.1.17 Details of equalized assessments necessary for Airdrie to calculate school tax rates.1.18 Review of Rocky Views equalized assessment by Airdries assessment staff from time to

time, such review to include examination of the market data used and the methodology ofcalculation and an explanation of the same by Rocky View.


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September 2011

1.19 All the above records and information shall be supplied concurrent with the preparation ofthe 2011 assessment roll for the 2012 tax year, shall be updated as of the date ofAnnexation or the date of assumption of responsibility for assessment by Airdrie, and shallbe provided from time to time as necessary to permit Airdrie to comply with the terms andconditions of the Agreement, which this Schedule forms a part.

PART 2 - TAX AND LEVY RECORDS

2.1 The current tax roll as it relates to the Annexation Territory.2.2 Details of the tax levy and of arrears, if any, including any changes transferred to the tax roll

such as utility and weed bills for each annexed parcel.

2.3 Details of any local improvement levies affecting the Annexation Territory including a copyof the bylaw, a copy of the borrowing bylaw and details, and the terms of the levy on eachannexed parcel.

2.4 Tax recovery details for properties and arrears, properties with tax notifications, propertiesthat have been finally acquired under the Municipal Government Act, and properties

where the redemption period has not expired including expiry date, details of tax sale trustaccount dates, and details of any proceeds of sales that are covered by a tax sale trustaccount.

2.5 School support details on a parcel by parcel by parcel basis together with supportingrecords including, but not limited to, copies of any corporate school declarations.

2.6 The policy and bylaw for any tax discounts.2.7 The policy and bylaw for penalties.2.8 A list of properties owned by Rocky View.2.9 The boundaries of any tax zones that have been established for recreational, fire or other

districts.

2.10 A record of any tax certificates that have been issued within the proceeding two (2) years.2.11 A copy of the property tax bylaws (mill rate bylaws).2.12 A list of all properties subject to any grant, and copies of any agreements where a grant-in-

lieu of taxes is to be paid.

2.13 A list of annexed parcels and relevant details of taxation, including procedures for linearproperties.

2.14 A list of land owned by Rocky View and leased to third parties including copies of all leases.


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September 2011

SCHEDULE E

Compensation Formula

1.1 Airdrie will compensate Rocky View for improvements to existing roads within theAnnexation Territory from 2006 onwards to the Effective Date of Annexation.

1.2 The compensation will be based on the following factors:(a) All road improvement costs, excepting chip seal road improvements, will be based

on actual County project costs. Costs for chip seal road improvements will be basedon proportional costs associated with County budgets;

(b) June of the year of construction will be used for assumed construction date for thevaluation of project life cycle;

(c) The life cycle for:(i) chip seal road improvements will be established at 5 years;(ii) paved road improvements will be established at 25 years; and(iii) sub-surface road improvements will be established at 40 years; and

(d) The amount for compensation will be based on the costs associated with eachimprovement depreciated by the life cycle of this improvement to the Effective Dateof Annexation.


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September 2011

1.3 Based on these factors and an effective date of annexation of December 31, 2011, thefollowing amounts have been calculated:

Road From To Length

(meters)

Year of

Improvement

Type of

Improvement

Improvement

Value

Depreciated

Value

Chip Seal Roads

CroxfordEstates

WestAnnexation

Boundary

RR 291 974.6 2009 Re-Chipping $ 29,239.20 $ 14,619.60

Range

Road 292

North

Annexation

Boundary

Existing

Airdrie

North

Boundary

719.7 2008 Re-Chipping $ 21,589.92 $6,476.98

Range

Road 291

Twp Rd 274 Hwy 567 3216.1 2007 Re-Chipping $ 96,482.25 $ 9,648.23

Range

Road 13

Hwy 567 Big Hill

Spring Road

3205.2 2007 Re-Chipping $ 96,155.58 $ 9,615.56

Subtotal $ 40,360.36

Paved RoadsDickson

Stevenso

n

Twp Rd 274 Existing

Airdrie

North

Boundary

2431.8 2007 Asphalt paving $ 152,347.12 $ 124,924.64

Range

Road 291

Hwy 567 Twp Rd 270 3216.1 2010 Asphalt paving $ 658,985.40 $ 619,446.28

Range

Road 291

Hwy 567 Twp Rd 270 3216.1 2007 Asphalt paving $ 99,133.82 $ 81,289.73

Range

Road 291

Hwy 567 Twp Rd 270 3216.1 2007 Re-Chipping $ 116,393.36 $ 95,442.56

Big Hill

Springs

Road

RR 13 Existing

Airdrie

WestBoundary

1628.7 2007 Asphalt paving $ 185,438.78 $ 152,059.80

Subtotal $ 1,073,163.00

Gravel Roads

Range

Road 292

Twp Rd 270 1 mile south

of Twp Rd

270

1606.2 2008

(completed in

2010)

Sub-grade

reconstruction

$ 541,625.50 $ 521,314.54

Subtotal $ 521,314.54

Total $ 1,634,837.90

If the effective date of annexation changes from December 31, 2011, the depreciated values

will be recalculated based on the factors identified in Section 1.2 of this Schedule.


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September 2011

SCHEDULE F

Title for Rocky View County Public Works Shop


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September 2011


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September 2011

SCHEDULE G

Roadways in Annexation Territory


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September 2011

SCHEDULE H

Range Road 292 Road Improvement Project


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September 2011

SCHEDULE I

Rocky View County Road Maintenance Service Levels

1.1 Snow Clearing and Winter Control (Rocky View County Policies 405 and 442)(a)

Installation of snow fence as required;

(b) Snow plowing and sanding performed on a priority basis as outlined in CountyPolicy 405 and Policy 442;

(c) Frozen culverts steamed out in Spring as required; and(d) Sweeping of winter sand from paved roadways is completed as soon as practicable

in the spring.

1.2 Asphalt Roads (Rocky View County Policy 426)(a) Smaller potholes repaired using hot mix material; and(b) Pavement preservation using a spray patching process on cracks is performed as

required.

1.3 Gravel Roads (Rocky View County Policy and Procedure 425)(a) Regular blading of gravel roads is performed by divisional graders on a 3 to 4 week

rotation. Inspection of routes is performed in service vehicles on rain and snowdays;

(b) Replenishment of surface gravel occurs on average every 3 years using 4-20 roadcrush applied at a rate of approximately 200 tonnes per km;

(c)

Spot repairs are performed during the summer months as required using 6-80, 2-40,4-20 or a combination thereof;

(d) Calcium chloride dust palliative applied once per year each spring as per CountyProcedure # 425.2 ; and

(e) Upgrades of gravel roads to a chip sealed surface are considered when trafficvolumes reach 200-400 vpd.

1.4 Oiled Roads(a) Small potholes repaired using cold mix material; and(b)

Oiled roads which experience severe alligatoring or breakup are ripped and re-laid(The County has discontinued the use of oil on roads as a dust suppressant).


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September 2011

1.5 Chip-Sealed Roads (Rocky View County Policy 426)(a) Small potholes repaired using hot mix material;(b) Re-chipping is scheduled approximately every 3-5 years, depending on condition

and change in traffic volumes; and

(c) Upgrade of chip sealed roads to a paved standard is considered once traffic volumesreach 600 vehicle trips per day.

1.6 Culverts (Rocky View County Policy 427)(a) Condition of culverts is checked regularly and repair, replacement or upsizing of

culverts is completed on a priority basis during the summer months.

1.7 Brushing, Mowing (Rocky View County Policies 409 and 428)(a) Clearing of brush from road allowances is performed regularly to maintain clear

sight lines and safe driving conditions. County standard is fence line to fence line at

intersections and down to ditch bottom elsewhere; and

(b) Road allowances are mowed once per year starting July 1st, with a 1.5 - 1.75 metercut.

1.8 Litter Cleanup(a) Cleanup of litter, dead appliances, dead animals is ongoing but on a low priority

basis (quite often performed on rainy days). Items in the road deemed to be a safetyhazard are removed on a high priority basis.

1.9 Guardrail, Guiderail(a) Guardrails, guiderails and posts are replaced on an as-needed basis.

1.10 Road Bans(a) Blanket spring road bans are initiated as follows: gravel and paved roads at 90%,

oiled and chip-sealed roads at 75%. Timing of implementation and removal isweather dependent but would typically be April 1st to May 30th.

1.11 All Rocky View County Policies and Procedures will be provided to the City of Airdrie uponrelease of the Annexation Order or Effective Date of Annexation.


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SCHEDULE J

Rocky View County Municipal Reserve Maintenance Levels

1.1 Municipal Reserve parcels in the Annexation Territory have been maintained by RockyView County to the following service levels:

(a) Grass is mowed 3 times per year;(b) Weed control including spraying for weeds is completed on a 3 year cycle. Checking

for types of weeds and amounts is completed every year;

(c) Garbage pickup is completed as required or at every site visit;(d) Signs must remain intact and legible; and(e) Perimeter fencing and posts should be inspected routinely to ensure they are intact.

Appendix 2: Annexation Agreement

Documents