The River Heights City Council on Dec. 30 approved a property-management agreement with Catalyst that city leaders said clarifies liability, dispute resolution and compensation.

The agreement, which the council reviewed after edits from City Attorney John Jenkins and negotiations with Catalyst’s representative Dan, removes large portions of arbitration language, extends the owner’s notice-to-terminate period to 45 days and establishes compensation terms that the council described as a 5.5% fee on gross rents collected (the manager will not be paid on tenant 'can fees'). The contract also sets the lease-up fee at $0.

Mayor Jason Thompson introduced the contract and told the council the city negotiated changes to avoid placing inappropriate liability on the city and to limit early-year repair costs being automatically charged to the city. “There were a lot of things, dealing with arbitration and dealing with liability,” he said, adding the city attorney had approved the final revisions.

Council members asked how leases would be managed. The mayor said the city will provide a standard lease template prepared by the city attorney that Catalyst will use with tenants; any proposed deviations would be returned to the mayor’s office and the city attorney for review before execution. The property manager will sign leases with tenants, while the city retains control of the lease template.

Council members also discussed operational details: the management company will handle day-to-day tasks and janitorial services (the city will pay for janitorial services), and the parties agreed to hold a workshop to set up bank accounts, money flow and communication protocols before full handover.

After allowing time for council members to read the final version, a motion to approve the agreement was moved and seconded and passed by voice vote.

The council scheduled a workshop with Catalyst to walk through implementation details. The management agreement will remain in effect until either party terminates it per the contract’s notice provisions.